Lecture 14: Consumer decision making Flashcards
What is the Consumer Decision making Process (CDM)
- Need recognition
- Information Search
- Evaluation of alternatives
- Purchase decision
- Post Purchase behaviour
What are the Perspectives on decision making?
Rational:
People calmly and carefully integrated as much info as possible with what they already know, painstakingly weigh pluses and minuses of each before arriving at a satisfactory decision.
Behavioural:
Decisions are made as a result of a learned response to environmental cues, e.g., buying on impulse as a result of a ‘special offer’ in a shop.
Experiential:
Conditions of high involvement but where the selection made cannot be explained in an entirely rational manner.
Why should we understand Consumer Decision Making?
*Central part of consumer behaviour
*Important for marketers to understand how consumers evaluate and choose
*Why? So, we can try and influence and at what stage.
Examples of how every consumer decision we make is in response to a problem?
- “I’m thirsty! I need a drink.”
- What university should I study with?
- My watch is broken, I need a new one. Should I get the new Apple Watch?
What helps us with our consumer decision making?
Cognitive:
- Deliberate, rational, sequential
Habitual:
- Behavioural
- Unconscious
- Automatic
Affective:
- Emotional
- Instantaneous
What is the paradox of choice?
- Decreased satisfaction
Or…. - Decision paralysis
Characteristics of Need Recognition
What am I missing?
- Usually occurs when there is a discrepancy between:
- actual state
- desired state
Characteristics of Information search
Begins with internal search and then moves to external search.
There are many factors that increase the extent of search.
- Product factors
- Situational factors
- Social acceptability
- Consumer factors
Factors of information search
Product Factors:
- Long time since last purchase
- High price
- Lots of choices
Situational factors
- First-time purchase
- Product is a gift
- Product usage deviates from reference group
Personal factors
- Well educated.
- Low dogmatic
- Younger
Types of consumer decisions?
Extensive problem solving
* A lot of information needed
* Must establish a set of criteria for evaluation
Limited problem solving
* Criteria for evaluation established
* Fine tuning with additional information
Routinised response behaviour
* Usually review what they already know
Characteristics of Evaluation of alternatives?
- Much of the effort we put into a purchase decision occurs at the stage where we have to choose a product from several alternatives.
- How do we evaluate?
- Evoked set Vs Consideration set
- Criteria for evaluating brands
- Decision rules
- Cross national study found that people generally include just a few products in their consideration set*
What are the Consumer decision rules
➢Compensatory: Evaluates each brand in terms of each relevant attribute and then selects the brand with the highest weighted score.
➢Non compensatory: Positive evaluation of a brand attribute does not compensate for a negative evaluation of the same brand on some other attribute - Conjunctive, disjunctive and lexicographic rule
Example of Compensatory rule
I selected the brand that came out best when I balanced the good ratings against the bad ratings (overall scores)
Example of Conjunctive rule
I selected the brand that had no bad features
Example of Disjunctive rule
I selected the brand that excelled in at least one attribute.
