decision making Flashcards
bus 347 final
name types of decisions
habitual: routine purchases
limited problem solving: some research involved
extended problem solving: high involvement, extensive search
mental shortcuts: higher price = higher quality
heuristics
play a significant role in shaping perceptions, attitudes, and decision-making, influence how consumers perceive stimuli
expectations
expectations influence how noticeable changes are; consumers need a sufficiently large contrast to perceive differences
Weber’s law
expectations influence how people assign meaning to stimuli
interpretation and biases
how can marketers use expectations in marketing
marketers can use sensory marketing to meet and exceed consumer expectations, reinforcing positive perceptions of brands
- failure to meet expectations creates perceptual dissonance
how does expectations influence attitudes and motivation
expectations affect how consumers evaluate a brand or product
how do expectations effect goal discrepancy in motivation
motivation arises when there is a gap between the current state and an ideal state
how do expectations effect memory and brand associations
expectations affect information when it is encoded and retrieved
e.g., a consumer who expects tide to be the “best stain remover” will store this information in memory
consumers expectations from one brand extension to another
analogical transfer
key idea of expectations in memory and learing
brands must manage consumer expectations by reinforcing consistent messages through advertising, product quality, and customer service
consumers rely on simplified expectations to make decisions under time constraints
bounded rationality
how do expectations affect decision making
- expectations serve as reference points
- consumers evaluate new options based on prior information
expectations act as a filter through which consumers interpret stimuli
perception in expectations
meeting or failing to meet expectations drives attitude formation and change
attitudes in expectations
expectations of achieving an “ideal state” motivate behaviour
motivation in expectations
expectatitions guide what consumers encode, store, and retrieve about brands
memory in expectations
consumers simply decisions using expectations as heuristics
decision making in memory
three types of rationality
- logical rationality
- material rationality
- ecological rationality
briefly describe logical rationality
people make decisions based on reference points
people tend to choose certainty in terms of gains
- usually the lower amount
when the problem is framed in terms of losses, people will gamble
- thus, people don’t know what their actual preference is
material rationality?
setting goals
briefly describe ecological rationality
- there is a fit between preference and options
- marketers have been shaping preferences for brands and benefits
- e.g., grocery stores selling produce and dairy next to one another bc they know they compliment one another
- long term companies may do this but a newer company might not
something you can decipher about a product or brand based on observations
search attributes
things you can only learn once you’ve purchased it or used it
experience attribute
