Consumer Behavior, Module 7

Problem recognition is defined as the

Perceived difference between an actual and an ideal state

Problem recognitions motivates the

Consumer to action

Problem recognition occurs if

Consumers become aware of a discrepancy between the actual state and the ideal state

Problem recognition relates to

Consumption and disposition as well as to acquisition

The actual state is the

Current state; the way things actually are

Ideal state is the

Way we want things to be

Where we get our notion of the ideal state:

• Simple expectations, usually based on past experiences

• Future goals or aspirations

• Cultural influences and reference groups

• Major changes in personal circumstances

What influences our perception of the actual state:

• Physical factor (such as a product malfunction)

• Needs (hunger, thirst)

• Creative mindset

• External stimuli

Marketers can help put consumers in a state of problem recognition and motivate them to

Start the decision process, leading them to acquire, consume, or dispose of a product or service

To put consumers in a state of problem recognition, marketers:

• Attempt to create a new ideal state

• Try to encourage our dissatisfaction with the actual state

Marketers can target the ideal state by

Showing consumers how the product is the solution to their problems

Internal search is defined as the

Process of recalling stored information from memory

The degree of internal search can

Vary widely

The effort consumers devote to internal search depends on their

MAO to process information

Consumers engage in active internal search only if

The information is stored in memory

Consumers can recall information from memory only if they have

The opportunity to do so

The kind of information retrieved from internal search:

• Recall of brands

• Recall of attributes

• Recall of evaluations

• Recall of experiences

Consideration (or evoked set) is defined as the

Subset of top-of-mind brands evaluated when making a choice

Consumers’ ability to recall brand information decreases as the

Size of the set increases

Consideration sets vary in terms of their

Size, stability, variety, and preference dispersion

Brand recall is impacted by the following factors:

• Prototypicality

• Brand familiarity

• Goals and usage situations

• Brand preference

• Retrieval cues

Consumers can often recall some details when they engage in internal search, and the recalled attributed information can strongly influence their brand choices influenced by the following variable factors:

• Accessibility or availability

• Diagnosticity

• Salience

• Vividness

• Goals

Diagnostic information is

Information that helps us discriminate among objects

Salient attribute is an

Attribute that is ‘top of mind’ or more important

Attribute determinance is an

Attribute that is both salient and diagnostic

Because our memory for specific details decay rapidly over time, we find

Overall evaluations or attitudes easier to remember than specific attribute information

Our evaluations tend to form

Strong associative links with the brand

Evaluations are more likely to be recalled by

Consumers who are actively evaluating the brand when they are exposed to relevant information

Online processing is when a

Consumer is actively evaluating a brand as they view an ad for it

Internal search can also involve the

Recall of experience from autobiographical memory in the form of specific images and the effect associated with them

Experiences that are more vivid, salient, or frequent are the

Most likely to be recalled

Processing biases alter the nature of internal search and can sometimes lead to

The recall of information that results in a less-than-optimal judgment or decision

Confirmation bias is the

Tendency to recall information that reinforces or confirms our overall beliefs rather than contradicting them, thereby making our judgment or decision more positive than it should be

Selective perception is when

We see what we want to see

Inhibition is the

Recall of one attribute inhibiting the recall of another

Consumers may remember but still ignore

Important and useful information

Consumers engaged in internal search are most likely to recall

Information, feelings, and experiences that match their mood

From a marketing perspective, confirmation bias presents a real problem when consumers search

Internally for only positive information about the competition

External search is defined as the

Process of collecting information from outside sources (Magazines, dealers, and ads)

Prepurchase search is a

Search for information that aids a specific acquisition decision

Ongoing search is a

Search that occurs regularly, regardless of whether the consumer is making a choice

Consumers can acquire information from several external sources:

• Retailer search

• Media and social media search

• Interpersonal search

• Independent search

• Experiential search

A retailer search includes:

• Visits or calls to stores or dealers

• Examination of package information or pamphlets

A media or social media search includes:

• Information from advertising, online ads, manufacturer-sponsored websites and forums, marketer-produced communications, and social media platforms

An interpersonal search includes:

• Advice from friends, relatives, neighbors, coworkers, and/or other consumers

An independent search includes:

• Consulting independent sources such as books, nonbrand-sponsored websites, government pamphlets, or magazines

An experiental search includes:

• Using product samples or product/service trials

• Experiencing the product online

Speed, user control, and two-way communication capability are key elements of

Website interactivity for conducting online searches

Consumers report higher satisfaction and stronger buying intentions when searching and shopping on sites that

Use an avatar

The number of exposures to online ads, the number of websites visited, and the number of pages viewed all have a

Positive effect on repeat purchasing

Online ads can speed up product search by

Suppressing interest in competing products

Consumers tend to employ social media sites when searching for

Hedonic products, while search engines and third-party reviews are more crucial for utilitarian products

Analyzing consumers’ buying pattern can improve

Shopping agents’ recommendations

Consumers have access to so much information that they can become

Overloaded

Overload can lead to a

Decline in decision quality

Choice overload can occur in situations where the

Problem is complex and the consumer has difficulty dealing with complexity

Other research suggests that increasing the number of options does not generally

Reduce choice quality

Creating a virtual product experience has a

Positive effect on consumer product knowledge and brand attitude, thereby reducing perceived risk and increasing purchase intention

Online community information is not controlled by marketers and is therefore seen as

More credible

80% of consumers changed their mind about

Buying a good or service after reading a negative review online

Positive reviews influenced the

Buying decisions of 87% of consumers surveyed

Marketers should encourage reviewers to describe their product experiences using

Vivid language that conveys their emotions and using words consistent with the product category

Average product ratings and number of reviews are also

Important pieces of information

Consumers’ internet search patterns can differ depending on

The type of product

When researching experience goods, consumers tend to

Dig into the details and spend some time on each web page

When researching search goods, consumers tend to

Cast the net wider, searching more sites but spending less time on each web page

Experience goods are

Products that cannot easily be evaluated until after purchase and use

Search goods are

Products that can be evaluated before purchase and use

Eight factors increase our motivation to conduct an external search:

• Involvement and perceived risk

• Perceived costs and benefits

• Consideration set

• Relative brand uncertainty

• Type of product

• Attitudes toward search

• Discrepancy of information

• Presence of others

External search is also strongly influenced by

The consumer’s ability to process information

The four variables that influence the consumer’s ability to process information:

• Consumer knowledge

• Cognitive abilities

• Consumer affect

• Demographics

Consumers knowledge is broken into two groups:

• Subjective

• Objective

Subjective knowledge is the

Consumer’s perception about what they know relative to what others know

Objective knowledge is the

Actual information stored in memory that can be measured with a formal knowledge test

Consumers who have the motivation and ability to search for information must

Still have the opportunity to process that information before an extensive search can take place

Situational factors that might affect the search process include the following:

• The amount of information

• The information format

• The time available

• The number of items being chosen

The extent to which consumers search for external information has

Important implications for marketing strategy

Marketers can make information readily

Available and easily accessible at the lowest cost and with the least consumer effort

Companies should also provide information about

Salient and diagnostic attributes, particularly if the brand has a differential advantage

Marketers can segment the market for a

Product or service according to search activity

Determining which search activities are commonly used for a particular product helps

Marketers plan to meet the information needs of their targeted consumers

Marketers can attempt to stimulate external search by

Providing information in a highly accessible manner

Researchers are interested in

The types of information that consumers acquire during an external search

Brand name is the most frequently accessed type of

Information because it is a central node around which other information can be organized in memory

Price is often the focus of consumer search because

It tends to be diagnostic and can be used to make inferences about other attributes such as quality and value

Even when consumers search on the basis of price, prior brand preference plays a

Role in how other information is processed

The importance of price depends on the

Culture

Attribute information for which consumers will search depends on

Which attributes are salient and diagnostic in the offering category

Consumers can be just as biased in their

Search for external information as they are during internal search

Consumers tend to search for external information that

Confirms rather than contradicts their overall beliefs

Confirmation bias can lead consumers to

Avoid important information, resulting in a less-than-optimal decision outcome

External search follows a series of

Sequential steps that can provide further insight into the consumer’s decision

An external search’s series of sequential steps include:

• Orientation

• Evaluation

• Verification

Consumers access different sources and use different decision criteria at

Different stages of the external search process

Consumers who are new to a product or service category will:

• Start by searching for information about low-risk, well-known brands

• Search lesser-known brands

• Consolidate the information leading to a preference for brands that provide the greatest utility

There are two major types of processes for external search:

• Searching by brand

• Searching by attribute

When consumers search by brand they

Acquire all the needed information on one brand before moving on to the next

When consumers search by attribute they

Compare brands in terms of one attribute at a time, such as by price

Different search strategies affect

Consumers’ decision processes differently

Consumers who process by brand remain

High in uncertainty until the very end of the search process