Consumer Decision Making

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Consumer Decision Making
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Three Perspectives on Decision Making

• Decision making perspective
• High involvement decisions
• Low involvement decisions
• Experiential perspective
• Behavioral influence perspective

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Decision Making PerspectiveHigh Involvement
Decisions
Extended Alternative Evaluation
Problem Recognition
Extensive Search
Complex Choice
Acquisition Evaluation
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Decision Making PerspectiveLow Involvement
Decisions
Minimal Alternative Evaluation
Simple Choice Processes
Problem Recognition
Limited Search
Acquisition Evaluation
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Experiential Perspective
Alternative Evaluation (comparison of affect)
Choice (affect-based)
Problem Recognition (affect driven)
Search for Affect-based Solutions
Acquisition Evaluation
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Behavioral Influence Perspective
Choice (behavior results from reinforcers)
Search (learned Response)
Acquisition Evaluation (self-perception
process)
Problem Recognition (results from discriminative
stimulus)
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Initial vs. Repeat Purchases

• Initial purchases
• Tend to require more extensive problem solving
• Repeat purchases
• Tend to require limited problem solving,
  sometimes habitual decisions

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Basic Decision Making Process
Problem/Need Recognition
Information Search
Evaluation of Alternatives
Purchase
Post-Purchase Evaluation
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Problem/Need Recognition

• Consumer recognizes a gap or discrepancy between
  his/her current state and his/her desired state.

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Information Search

• Deliberate attempt to gain knowledge about a
  purchase decision goal is to reduce uncertainty.
• Internal search
• Retrieve information from long term memory
• External search
• Gather information from external sources, e.g.,
  ads, media, friends, stores

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Determinants of External Search
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Evaluation of Alternatives

• Occurs either separately or in conjunction with
  information search.
• We rely on internal processes to help us organize
  the evaluation process.
• Consideration (evoked set)
• Decision rules (heuristics)

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Consideration Set
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Decision Rules

• Strategies used by consumers to guide decision
  making.
• Some decision rules use product characteristics
  to guide decisions.
• Compensatory
• Noncompensatory
• Some decision rules rely on stored information in
  consumers memories to guide decisions.

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Compensatory Decision Rule

• Select the best overall brand
• Consumer evaluates brand options in terms of each
  relevant attribute and computes a weighted or
  summated score for each brand. The consumer
  chooses the brand with the highest score.
• A compensatory model because a positive score on
  one attribute can outweigh a negative score on
  another attribute.

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Noncompensatory Decision Rules

• Conjunctive Decision Rule
• Consumer sets a minimum standard for each
  attribute and if a brand fails to pass any
  standard, it is dropped from consideration.
• Reduces a large consideration set to a manageable
  size.
• Often used in conjunction with another decision
  rule.

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Noncompensatory Decision Rules

• Disjunctive Decision Rule
• Consumer sets a minimum acceptable standard as
  the cutoff point for each attribute--any brand
  that exceeds the cutoff point is accepted.
• Reduces large consideration set to a more
  manageable number of alternatives.
• Consumer may settle for the first satisfactory
  brand as final choice or may use another decision
  rule.

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Noncompensatory Decision Rules

• Lexicographic Decision Rule
• The consumer ranks the attributes according to
  importance and then selects the brand that is
  superior on the most important attribute.
• If one brand ranks sufficiently high on just one
  attribute, it will be selected regardless of how
  it scores on other attributes.

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Affect-Referral Rule

• Synthesized decision rule
• Consumers maintain overall evaluations of brands
  in their long term memories. Brands on not
  evaluated on individual attributes but on the
  highest perceived overall rating.

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Frame of Reference

• Another way in which consumers evaluate
  information is the frame of reference from which
  s/he subjectively evaluates messages related to a
  decision problem.
• Percent lean vs. Percent fat
• Sale vs. Clearance

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Purchase Decision
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Post-Purchase Evaluation

• Consumers evaluate purchases during consumption
  process.
• Three possible outcomes.
• Postpurchase cognitive dissonance.
• Complaining behavior.

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Outcomes

• Actual product performance matches prepurchase
  expectations
• Neutral Feeling

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Outcomes

• Actual product performance exceeds prepurchase
  expectations.
• Positive disconfirmation of expectations
• Satisfaction

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Outcomes

• Actual product performance is below prepurchase
  expectations.
• Negative disconfirmation of expectations
• Dissatisfaction

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A Continuum of Satisfaction
Dissatisfaction
Satisfaction
Delighted
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If dissatisfied.

• Alternative actions
• Do nothing
• Avoid seller/brand in the future
• Negative WOM to friends
• Seek redress of problem from seller
• Complain to outside agency

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Decision to complain...

• Is based on
• Level of dissatisfaction
• Importance of decision/purchase
• Costs/benefits of actions
• Personal characteristics
• Attribution of blame

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Managerial Implications Related to Consumer
Decision Making

• Understanding decision making process enables
  marketers to assist consumers along decision
  pathway.
• Offer products that meet needs/wants
• Advertising
• Making information available
• Making product available
• Follow-up sales calls, good service

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