Ch. 9 The Consumer Decision Making Process

aida model

awareness, interest, desire, action (and then ideally retention)

ideal decision making process

1. identify a problem or desire

2. search for relevant information

3. form a brand consideration set

4. information integration and evaluation (AIDA part)

5. choice

6. post choice evaluation

universal set

• all possible choices for a product category

• overwhelming

• consumers hace limited time, cognitive capacity, motivation, etc.

consideration set

the subset of brand from which a consumer will actually choose from

• derived from:

  • evoked set: internal search, the info stored in memory

  • external information search

  • point of purchase: situational, products and information available

usually 7+-2 brands

goal of marketers

• marketers want to make sure they are in the consideration set

• also need to make sure that they are evaluated favourable when compared to others in a set

part list cuing

marketers try to influence which and how many other brands are in the consideration set

• providing a partial list of brands makes it more difficult to recall all brands from memory

• people will focus their attention and choice on the brands presented while ignoring others

• marketers will choose other brands that they compare favourable with

  • comparative advertising

    • eg. burger king subtle hinting at Mcdonalds in their ad

  • retail environment

the attraction effect

• brand appears more attractive when compared to inferior brands and less attractive when compared to superior brands

• by managing comparisons, marketers can increase attraction

• more brands in a specific cluster often signals attribute importance

the compromise effect

• a target brand appears more attractive when it is viewed as a “good compromise”

• compromise brands are seen as average on all important attributes

  • eg. 10 and 15 dollar wines on the menu, add a 20 dollar bottle and more people choose the 15 as a compromise

constructing evaluation

information for evaluation comes from internal (memory) and external sources (stimulus)

• memory based choice: none of the considered brands are physically or directly observable (eg. choosing a restaurant)

• stimulus based choice: consumers directly and physically observe all relevant brands in the consideration set (eg. choosing a beverage at a grocery store)

• mixed choice: consumers can see some brands but must remember others

consumer choice - attitude based

choice can be made based on existing attitudes or by comparing attributes. attitude:

• all info about a brand is combined into an overall evaluation (attitude) and stored in memory

• the overall evaluation is used for choice

• can only occur if you have an overall evaluation

• commonly used for memory-based choice

• attitudes are more accessible than attributes

consumer choice - attribute based

• consumers compare the specific attributes or features of each brand

• select the brand that performs the best on the key attributes

• commonly used for stimulus based choice

• attributes are more diagnostic (relevant) than attitudes

choice deferral

decision to choose nothing

• too many options requiring too many trade offs

• missing information

• uncertainty encourages consumers to postpone decision making and search for additional information

heuristics

mental shortcuts that simplify decision making

• three general types are persuasion, prediction, and influence (choice)

persuasion heuristics

influence consumers beliefs and attitudes

• length implies strength

  • lots of info is more compelling

  • brands that list more favourable attributes are better than brands that list less (eg. theory of reasoned action - additive model(

• liking agreement heurisitc

  • consumers generally agree with people they like (eg. balance theory)

• consensus implies correctness (bandwagon effect)

  • if everyone is buying it, it must be good (social validation)

prediction heuristics

used to form likelihood judgements or predictions about future product performance

• representativeness

• availability

• simulation

• anchoring and adjustment

representative heuristics

• making predictions based on perceived similarities between a specific target and a general category

• different brands with similar names, packaging, appearance, etc.

  • eg. private label appearing to be representatice of national brands

• brand extensions (you like oreos, you assume you like oreo ice cream)

• brand associations

availability heuristic

makes predictions based on how easily information can be retrieved from memory (accessibility)

• memorable, frequent, recent exposure is more easily recalled

  • easy to recall events are overestimated

  • difficult to recall events are underestimated

    • eg. easier to recall words that start with T than words with T as the third letter, but that doesn’t mean there are less

  • ease of recall can suggest preference (eg. strong brands)

• can be influenced by media, TV, and advertising

simulation heuristic

• easy to imagine events are overestimated

• difficult to imagine events are underestimated

• eg. product performance (demonstrational ads), winning the lottery

anchor and adjustment heuristic

• makes predictions based on an initial judgement or reference

• starting point affects the final decision

  • suggesting a larger quantity can result in larger purchases even without a quantity discount

  • multi unit pricing (10 for $9.99)

  • price quantity limits (max 10 per customer)

  • now instead of starting your consideration at 1 product and going up, you start at 10 and go down, and you’re likely to end with a larger number

  • or show the more expensive price of a product, compared to sale price

influence (choice) heuristics

directly influence consumer choice

• lexicographic

• elimination by aspects

• additive difference

• conjunctive and disjunctive

• frequency of good and bad features

difference heuristics can result in different choices

lexicographic (single attribute) heuristic

• compare brands on one key attribute and choose the brand that performs best on this single attribute

• generally, a determinant attribute (matters a lot to consumer, eg. price, safety, flavour, etc.)

elimination by aspects heuristic

• choose an important feature and reject all brands that don’t have this feature

• choose the next most important feature and reject all brands that do not have that feature, and so on

• commonly used to reduce the choice set

additive difference heuristic

• compare brands two at a time (A and B)

• assign importance weight to all relevant attributes (w)

• compute a difference score for each attribute (Ai - Bi)

• sum them up, and a positive score means preference for A

conjunctive heuristic

• set a minimum value for all relevant attributes

• analyze one brand at a time

• select the first brand that meets the minimum on all attributes

disjunctive heuristic

• set an acceptable value (higher than minimum) for all relevant attributes

• chooses the first product that meets this value on one particular attribute

frequency of good and bad features

• count the number of good and bad product features

• choose the brand with the greatest positive difference

post purchase evaluation

• consumers continue to process information about attributes and brands after purchase and consumption to determine satisfaction

• expectancy disconfirmation model

  • compares perceptions of a brand’s performance with their expectations

• dissonance reduction

  • dissatisfaction results in dissonance

  • strategies for reducing dissonance

    • increasing the perceived attractiveness of chosen alternative

    • decreasing the perceived attractiveness of rejected alternative

    • increasing the perceived similarity between alternatives

    • revoking the decision