week 9 Flashcards
Judgement define
evaluation of an object regarding the likelihood that products and service possess certain features of will perform in a certain manner
anchoring and adjustment define
starting with first evaluation and adjusting it with additional info
imagery define
imagining an event when making judgements
mental accounting define
categorising spending and saving decisions into mental accounts
anchoring
People make estimates by starting from an initial value and adjust it to get a final answer.
how consumers use anchoring to buy
when making purchasing decisions, consumers adopt a low anchorage (deciding only to buy 1 or 2) and then adjust upward depending on price, budget etc.
how can retailers use anchoring to increase buying
can put deals on so that the adjustment of the anchor affects the buying decision and they buy more
underconsumption define
budgeting not enough money to something
overconsumption
budgeting too much money to something
how do you make budgeting an effective self-control mechanism?
make budgeting inflexible
what is self-positivity bias?
a persons belief that they probably wont experience a negative event.
this can lead to bad spending choices.
reducing their self-positivity bias is a preventive behavior
what is negativity bias?
bas stronger than good - negative events have greater weight than good.
positive info is valued less than negative
can mood affect negative or positive bias?
Yes. mood may attribute (or misattribute) this feeling to a target and theu may use it for eveluation
True or false. Mood will have minimal effect of the evaluation on latter options
True.
attraction effect define
addition of inferior brands to a consideration set increases the attractiveness of dominant brands
what are the two stage shopping process involving goals
- initial stages:
uncertain about what to buy/spend (have abstract goals) - second stage: determine goals and action tenacity (have concrete goals)
what affect does external factors have on the first and second stage of shopping process?
much effect on the first and little on the second. external factors can change goals in the frist but not in the second once they have been cemented.
what is the construal level theory (CLT)
Explains which product attributes are considered at each stage.
Theory says that individuals think about actions or events abstractly when theyre distant, and in more broader categories when they draw near.
which product attributes occur at each stage and how does CLT explain it
- formation of consideration set:
stage where the consumer is mentally distance from the purchase and abstract qualities (ie quality) are crucial - final purchase decision: low level, concrete or peripheral features (ie price) are important
what is reference dependence?
where the carriers of value are gains and losses defined by a reference point
what is loss aversion ?
losses are worse than gains
what is diminishing sensitivity?
the value of both gains and losses decreases with their size
what is the conjunctive model?
where consumers set up minimum cutoffs for each attribute that present the absolute lowerst value they are willing to accept
Disjunctive Model
where consumers set up acceptable levels for the cutoffs for each attribute to find options that are good
additive difference model
where consumers evaluate differences between the two brands on each attribute and then combine them into an overall preference (preference list/pros and cons)
Lexicographic model
where consumers order attributes in terms of importance to select an option
elimination by aspect model
similar to lexigraphic, but uses the notion of an acceptable cutoff
What is effective forecasting?
the preditcion of the emotional consequence of decisions. (ie anticipated emotions)
what are the two main things affecting high-effort decisions
- consumer characteristics
2. characteristics of the decision
