Consumer Decision Process and Problem Recognition Notes

Consumer Behavior Building Marketing Strategy

Consumer Decision Process and Problem Recognition

• Purchase involvement: The level of concern for, or interest in, the purchase process.

• Triggered by the need to consider a particular purchase.

• A temporary state influenced by the interaction of individual, product, and situational characteristics.

Types of Consumer Decisions

• Low-involvement purchase

• High-involvement purchase

• Nominal decision making: Problem recognition is selective.

• Limited decision making: Problem recognition is generic; Includes limited internal purchase and information search, and limited external search.

• Extended decision making: Problem recognition is generic; Includes internal and external information search.

• Alternative evaluation:

  • Few attributes and simple decision rules with few alternatives in nominal decision making.

  • Many attributes and complex decision rules with many alternatives in extended decision making.

• Postpurchase:

  • No dissonance and very limited evaluation in nominal decision making.

  • Dissonance and complex evaluation in extended decision making.

Types of Decision Making

1. Nominal (Small) Decision Making

   • Brand loyal purchases.

   • Repeat purchases.

2. Limited Decision Making

3. Extended (Long) Decision Making

Nominal Decision Making

• Occurs when there is very low involvement with the purchase.

• A completely nominal decision does not even include consideration of the “do not purchase” alternative.

• Consumer buys Campbell’s without considering other brands or its price.

• Also known as habitual decision making, effectively involves no decision per se.

Limited Decision Making

• Middle ground between nominal and extended decision making.

• Involves recognizing a problem for which there are several possible solutions.

• Decision based only on buying the cheapest rolls.

• Involves internal and limited external search, few alternatives, simple decision rules on a few attributes, and little postpurchase evaluation.

Extended Decision Making

• Response to the high level of purchase involvement.

• During post-purchase evaluation, doubts are likely, and a thorough evaluation takes place.

• Emotional decisions may involve substantial cognitive effort.

• Involves extensive internal and external search followed by a complex evaluation of multiple alternatives.

The Process of Problem Recognition

• Active Problem: The consumer is aware of or will become aware of in the normal course of events.

  • Example: "I need this product…e.g., mobile."

  • Marketing strategy: Only require the marketer to convince consumers that its brand is the superior solution.

• Inactive Problem: The consumer is not aware of.

  • Example: "Consumer is unaware or doesn’t need the product… e.g., mobile."

  • Marketing strategy: Marketer must convince consumers that they have the problem AND that their brand is a superior solution.

Marketing Strategy and Problem Recognition

1. Discovering Consumer Problems

2. Responding to Consumer Problems

3. Helping Consumers Recognize Problems

4. Suppressing Problem Recognition

Discovering Consumer Problems

• Surveys and focus groups use one of the following approaches to problem identification:

  1. Activity Analysis: Focuses on a particular activity to determine what problems consumers encounter during the performance of the activity.

  2. Product Analysis: Examines the purchase or use of a particular product or brand. Consumers may be asked about problems associated with using a product or brand.

  3. Problem Analysis: Starts with a problem and asks which activities, products, or brands are associated with (or perhaps could eliminate) those problems.

Human Factors Research

• Attempts to determine human capabilities in areas such as vision, strength, response time, flexibility, and fatigue and the effect on these capabilities of lighting, temperature, and sound.

• Observational techniques such as slow-motion and time-lapse photography, video recording, and event recorders are particularly useful methods.

• This type of research can sometimes identify functional problems that consumers are unaware of.

Emotion Research

• Marketers are increasingly conducting research on the role of emotions in problem recognition and resolution.

• Common approaches are focus group research and personal interviews that examine the emotions associated with certain problems.

• Critical in helping marketers anticipate consumer reaction to problems and train customer service personnel to respond appropriately.

Responding to Consumer Problems

• Once a consumer problem is identified, the manager may structure the marketing mix to solve the problem. This can involve:

  • Developing a new product or altering an existing one

  • Modifying channels of distribution

  • Changing pricing policy

  • Revising advertising strategy

Helping Consumers Recognize Problems

• Generic Problem Recognition: Involves a difference that a variety of brands within a product category can reduce (e.g., Dairy food).

  • Increasing generic problem recognition generally results in an expansion of the total market.

• Selective Problem Recognition: Involves a discrepancy only one brand can solve (e.g., Rawabi milk, AlAin milk).

  • Firms attempt to cause selective problem recognition to gain or maintain market share.

Approaches to Activating Problem Recognition

• Problem recognition is a function of

  • (1) the importance, and

  • (2) the magnitude

• of a discrepancy between the desired state and an existing state

Suppressing Problem Recognition

• Occasionally, information is introduced in the marketplace that triggers problem recognition that some marketers prefer to avoid.

• Marketers do not want their current customers to recognize problems with their brands.

• Effective quality control and distribution (limited out-of-stock situations) are important in this effort.

• Packages and package inserts that assure the consumer of the wisdom of their purchase are also common.