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Consumer Decision Making
and Beyond
Levels of Consumer Decision Making
Extensive Problem Solving
Limited Problem Solving
Routine Response
Behavior
Extensive
Problem
Solving
A search by the consumer to
establish the necessary
product criteria to evaluate
knowledgeably the most
suitable product to fulfill a
need.
Limited
Problem
Solving
A limited search by a
consumer for a product that
will satisfy his or her basic
criteria from among a
selected group of brands.
Models of Consumers: Four Views of
Consumer Decision Making
• An Economic View
• A Passive View
• A Cognitive View
• An Emotional View
The Economic view
Rational Customers Have To …
• Be aware of all available
product alternatives
• Be capable of correctly
ranking each alternative in
terms of its benefits and
disadvantages
Why is the Classical Economic Model
Considered Unrealistic?
• People are limited by
their existing skills,
habits, and reflexes
• People are limited by
their existing values and
goals
Models of Consumers: Four Views of
Consumer Decision Making
• A Passive View
• A Cognitive View
• An Emotional View - mood
Figure 16.2 A Simple Model of Consumer Decision Making
Firm’s Marketing Efforts
1. Product
2. Promotion
3. Price
4. Channels of distribution
Sociocultural Environment
1. Family
2. Informal sources
3. Other noncommercial sources
4. Social class
5. Subculture and culture
Need Recognition
Prepurchase Search
Evaluation of Alternatives
Psychological Field
1. Motivation
2. Perception
3. Learning
4. Personality
5. Attitudes
Experience
Purchase
1. Trial
2. Repeat purchase
Postpurchase Evaluation
Output
Process
Input
External Influences
Consumer Decision Making
Postdecision Behavior
Consumer Decision Rules
• Compensatory
• Noncompensatory
– Conjunctive Decision Rule
– Disjunctive Decision Rule
– Lexicographic Rule
Compensatory
Decision Rules
A type of decision
rule in which a
consumer evaluates
each brand in terms
of each relevant
attribute and then
selects the brand
with the highest
weighted score.
Non-
compensatory
Decision
Rules
A type of consumer
decision rule by which
positive evaluation of
a brand attribute
does not compensate
for a negative
evaluation of the
same brand on some
other attribute.
Conjunctive
Decision
Rule
A noncompensatory
decision rule in which
consumers establish a
minimally acceptable
cutoff point for each
attribute evaluated.
Brands that fall below
the cutoff point on any
one attribute are
eliminated from
further consideration.
Disjunctive
Rule
A noncompensatory
decision rule in which
consumers establish a
minimally acceptable
cutoff point for each
relevant product
attribute.
Lexicographic
Rule
A noncompensatory
decision rule -
consumers first rank
product attributes in
terms of importance,
then compare brands
in terms of the
attribute considered
most important.
Affect
Referral
Decision
Rule
A simplified decision rule
by which consumers
make a product choice
on the basis of their
previously established
overall ratings of the
brands considered,
rather than on specific
attributes.
Table : Hypothetical Use of Popular Decision Rules in
Making a Decision to Purchase a Laptop
DECISION RULE MENTAL STATEMENT
Compensatory rule “I selected the computer that came out best when I
balanced the good ratings against the bad ratings.”
Conjunctive rule “I selected the computer that had no bad features.”
Disjunctive rule “I picked the computer that excelled in at least one
attribute.”
Lexicographic rule “I looked at the feature that was most important to me
and chose the computer that ranked highest on that
attribute.”
Affect referral rule “I bought the brand with the highest overall rating.”
Consumer Motivation
Factors Affecting Consumer Behavior:
Psychological
Psychological
Factors
Motivation
Perception
Learning
Beliefs and
Attitudes
Copyright 2007 by Prentice
Hall
Maslow’s Hierarchy of Needs
Personality and
Consumer Behavior
What Is Personality ?
The inner psychological characteristics that
both determine and reflect how a person
responds to his or her environment
Copyright 2007 by Prentice Hall
The Nature of Personality
• Personality reflects individual
differences
• Personality is consistent and
enduring
• Personality can change
Copyright 2007 by Prentice Hall
Discussion Questions
• How would you describe your personality?
• How does it influence products that you
purchase?
Copyright 2007 by Prentice Hall
Theories of Personality
• Freudian theory
– Unconscious needs or drives are at the heart of
human motivation
• Neo-Freudian personality theory
– Social relationships are fundamental to the
formation and development of personality
• Trait theory
– Quantitative approach to personality as a set of
psychological traits
Copyright 2007 by Prentice Hall
Trait Theory
• Personality theory with a focus on
psychological characteristics
• Trait - any distinguishing, relatively enduring
way in which one individual differs from
another
• Personality is linked to how consumers make
their choices or to consumption of a broad
product category - not a specific brand
Copyright 2007 by Prentice Hall
Trait Theory
• Innovativeness
• Dogmatism
• Social character
• Need for uniqueness
• Variety-novelty seeking
• The degree to which
consumers are
receptive to new
products, new services,
or new practices
Consumer Innovators
And Noninnovators
Copyright 2007 by Prentice Hall
Trait Theory
• Innovativeness
• Dogmatism
• Social character
• Need for uniqueness
• Variety-novelty seeking
• A personality trait that
reflects the degree of
rigidity a person displays
toward the unfamiliar and
toward information that is
contrary to his or her own
established beliefs
Consumer Innovators
And Noninnovators
Copyright 2007 by Prentice Hall
Trait Theory
• Innovativeness
• Dogmatism
• Social character
• Need for uniqueness
• Variety-novelty seeking
• Ranges on a continuum for
inner-directedness to other-
directedness
• Inner-directedness
– rely on own values when
evaluating products
– Innovators
• Other-directedness
– look to others
– less likely to be innovators
Consumer Innovators
And Noninnovators
Copyright 2007 by Prentice Hall
Trait Theory
• Innovativeness
• Dogmatism
• Social character
• Need for uniqueness
• Variety-novelty seeking
• Consumers who avoid
appearing to conform to
expectations or
standards of others
Consumer Innovators
And Noninnovators
Copyright 2007 by Prentice Hall
Brand Personality
• Personality-like traits associated with brands
• Examples
– Nike and athlete
– BMW is performance driven
– Levi’s jeans are dependable and rugged
• Brand personality which is strong and favorable will
strengthen a brand but not necessarily demand a
price premium
Copyright 2007 by Prentice Hall
Discussion Questions
• Pick three of your favorite brands.
• Describe their personality. Do they have a
gender? What personality traits do they
have?
Commands respect, authority
Caution, novelty, temporary, warmth
Secure, natural, relaxed or easy- going,
living things
BLUE
YELLOW
GREEN
Table : The Personality-like Associations of Colors
Copyright 2007 by Prentice Hall
Human, exciting, hot, passionate, strong
Powerful, affordable, informal
Informal and relaxed, masculine, nature
Goodness, purity, chastity, cleanliness,
delicacy, refinement, formality
Sophistication, power, authority, mystery
Regal, wealthy, stately
RED
ORANGE
BROWN
WHITE
BLACK
SILVER, GOLD
Consumer Perception
Copyright 2007 by Prentice Hall
Perception
• The process by which an individual selects,
organizes, and interprets stimuli into a
meaningful and coherent picture of the world
• How we see the world around us
Sketchers
Copyright 2007 by Prentice Hall
Aspects of Perception
Selection
Organization
Interpretation
Copyright 2007 by Prentice Hall
Perceptual Selection
• Selective Exposure
• Selective Attention
• Perceptual Defense
• Perceptual Blocking
• Consumers seek out
messages which:
– Are pleasant
– They can sympathize
– Reassure them of good
purchases
Concepts
Copyright 2007 by Prentice Hall
Perceptual Selection
• Selective Exposure
• Selective Attention
• Perceptual Defense
• Perceptual Blocking
• Heightened awareness
when stimuli meet their
needs
• Consumers prefer
different messages and
medium
Concepts
Copyright 2007 by Prentice Hall
Perceptual Selection
• Selective Exposure
• Selective Attention
• Perceptual Defense
• Perceptual Blocking
• Screening out of stimuli
which are threatening
Concepts
Copyright 2007 by Prentice Hall
Perceptual Selection
• Selective Exposure
• Selective Attention
• Perceptual Defense
• Perceptual Blocking
• Consumers avoid being
bombarded by:
– Tuning out
Concepts
Copyright 2007 by Prentice Hall
Organization
• Grouping
• Closure
• People group stimuli to
form a unified
impression or concept.
• Grouping helps memory
and recall.
Principles
Copyright 2007 by Prentice Hall
Organization
• Grouping
• Closure
• People have a need for
closure and organize
perceptions to form a
complete picture.
• Will often fill in missing
pieces
• Incomplete messages
remembered more than
complete
Principles
Copyright 2007 by Prentice Hall
Interpretation
• Physical
Appearances
• First Impressions
• Jumping to
Conclusions
• Halo Effect
• Positive attributes of
people they know to
those who resemble
them
• Important for model
selection
• Attractive models are
more persuasive for
some products
Perceptual Distortion
Copyright 2007 by Prentice Hall
Interpretation
• Physical
Appearances
• First Impressions
• Jumping to
Conclusions
• Halo Effect
• First impressions are
lasting
• The perceiver is trying
to determine which
stimuli are relevant,
important, or predictive
Perceptual Distortion
Copyright 2007 by Prentice Hall
Interpretation
• Physical
Appearances
• First Impressions
• Jumping to
Conclusions
• Halo Effect
• People tend not to listen
to all the information
before making
conclusion
• Important to put
persuasive arguments
first in advertising
Perceptual Distortion
Copyright 2007 by Prentice Hall
Interpretation
• Physical
Appearances
• First Impressions
• Jumping to
Conclusions
• Halo Effect
• Consumers perceive and
evaluate multiple objects
based on just one
dimension
• Used in licensing of names
Perceptual Distortion
Copyright 2007 by Prentice Hall
The halo effect
helps Adidas
break into new
product
categories.

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Decision rule and motivation

  • 2. Levels of Consumer Decision Making Extensive Problem Solving Limited Problem Solving Routine Response Behavior
  • 3. Extensive Problem Solving A search by the consumer to establish the necessary product criteria to evaluate knowledgeably the most suitable product to fulfill a need.
  • 4. Limited Problem Solving A limited search by a consumer for a product that will satisfy his or her basic criteria from among a selected group of brands.
  • 5. Models of Consumers: Four Views of Consumer Decision Making • An Economic View • A Passive View • A Cognitive View • An Emotional View
  • 6. The Economic view Rational Customers Have To … • Be aware of all available product alternatives • Be capable of correctly ranking each alternative in terms of its benefits and disadvantages
  • 7. Why is the Classical Economic Model Considered Unrealistic? • People are limited by their existing skills, habits, and reflexes • People are limited by their existing values and goals
  • 8. Models of Consumers: Four Views of Consumer Decision Making • A Passive View • A Cognitive View • An Emotional View - mood
  • 9. Figure 16.2 A Simple Model of Consumer Decision Making Firm’s Marketing Efforts 1. Product 2. Promotion 3. Price 4. Channels of distribution Sociocultural Environment 1. Family 2. Informal sources 3. Other noncommercial sources 4. Social class 5. Subculture and culture Need Recognition Prepurchase Search Evaluation of Alternatives Psychological Field 1. Motivation 2. Perception 3. Learning 4. Personality 5. Attitudes Experience Purchase 1. Trial 2. Repeat purchase Postpurchase Evaluation Output Process Input External Influences Consumer Decision Making Postdecision Behavior
  • 10. Consumer Decision Rules • Compensatory • Noncompensatory – Conjunctive Decision Rule – Disjunctive Decision Rule – Lexicographic Rule
  • 11. Compensatory Decision Rules A type of decision rule in which a consumer evaluates each brand in terms of each relevant attribute and then selects the brand with the highest weighted score.
  • 12. Non- compensatory Decision Rules A type of consumer decision rule by which positive evaluation of a brand attribute does not compensate for a negative evaluation of the same brand on some other attribute.
  • 13. Conjunctive Decision Rule A noncompensatory decision rule in which consumers establish a minimally acceptable cutoff point for each attribute evaluated. Brands that fall below the cutoff point on any one attribute are eliminated from further consideration.
  • 14. Disjunctive Rule A noncompensatory decision rule in which consumers establish a minimally acceptable cutoff point for each relevant product attribute.
  • 15. Lexicographic Rule A noncompensatory decision rule - consumers first rank product attributes in terms of importance, then compare brands in terms of the attribute considered most important.
  • 16. Affect Referral Decision Rule A simplified decision rule by which consumers make a product choice on the basis of their previously established overall ratings of the brands considered, rather than on specific attributes.
  • 17. Table : Hypothetical Use of Popular Decision Rules in Making a Decision to Purchase a Laptop DECISION RULE MENTAL STATEMENT Compensatory rule “I selected the computer that came out best when I balanced the good ratings against the bad ratings.” Conjunctive rule “I selected the computer that had no bad features.” Disjunctive rule “I picked the computer that excelled in at least one attribute.” Lexicographic rule “I looked at the feature that was most important to me and chose the computer that ranked highest on that attribute.” Affect referral rule “I bought the brand with the highest overall rating.”
  • 19. Factors Affecting Consumer Behavior: Psychological Psychological Factors Motivation Perception Learning Beliefs and Attitudes
  • 20. Copyright 2007 by Prentice Hall Maslow’s Hierarchy of Needs
  • 22. What Is Personality ? The inner psychological characteristics that both determine and reflect how a person responds to his or her environment
  • 23. Copyright 2007 by Prentice Hall The Nature of Personality • Personality reflects individual differences • Personality is consistent and enduring • Personality can change
  • 24. Copyright 2007 by Prentice Hall Discussion Questions • How would you describe your personality? • How does it influence products that you purchase?
  • 25. Copyright 2007 by Prentice Hall Theories of Personality • Freudian theory – Unconscious needs or drives are at the heart of human motivation • Neo-Freudian personality theory – Social relationships are fundamental to the formation and development of personality • Trait theory – Quantitative approach to personality as a set of psychological traits
  • 26. Copyright 2007 by Prentice Hall Trait Theory • Personality theory with a focus on psychological characteristics • Trait - any distinguishing, relatively enduring way in which one individual differs from another • Personality is linked to how consumers make their choices or to consumption of a broad product category - not a specific brand
  • 27. Copyright 2007 by Prentice Hall Trait Theory • Innovativeness • Dogmatism • Social character • Need for uniqueness • Variety-novelty seeking • The degree to which consumers are receptive to new products, new services, or new practices Consumer Innovators And Noninnovators
  • 28. Copyright 2007 by Prentice Hall Trait Theory • Innovativeness • Dogmatism • Social character • Need for uniqueness • Variety-novelty seeking • A personality trait that reflects the degree of rigidity a person displays toward the unfamiliar and toward information that is contrary to his or her own established beliefs Consumer Innovators And Noninnovators
  • 29. Copyright 2007 by Prentice Hall Trait Theory • Innovativeness • Dogmatism • Social character • Need for uniqueness • Variety-novelty seeking • Ranges on a continuum for inner-directedness to other- directedness • Inner-directedness – rely on own values when evaluating products – Innovators • Other-directedness – look to others – less likely to be innovators Consumer Innovators And Noninnovators
  • 30. Copyright 2007 by Prentice Hall Trait Theory • Innovativeness • Dogmatism • Social character • Need for uniqueness • Variety-novelty seeking • Consumers who avoid appearing to conform to expectations or standards of others Consumer Innovators And Noninnovators
  • 31. Copyright 2007 by Prentice Hall Brand Personality • Personality-like traits associated with brands • Examples – Nike and athlete – BMW is performance driven – Levi’s jeans are dependable and rugged • Brand personality which is strong and favorable will strengthen a brand but not necessarily demand a price premium
  • 32. Copyright 2007 by Prentice Hall Discussion Questions • Pick three of your favorite brands. • Describe their personality. Do they have a gender? What personality traits do they have?
  • 33. Commands respect, authority Caution, novelty, temporary, warmth Secure, natural, relaxed or easy- going, living things BLUE YELLOW GREEN Table : The Personality-like Associations of Colors
  • 34. Copyright 2007 by Prentice Hall Human, exciting, hot, passionate, strong Powerful, affordable, informal Informal and relaxed, masculine, nature Goodness, purity, chastity, cleanliness, delicacy, refinement, formality Sophistication, power, authority, mystery Regal, wealthy, stately RED ORANGE BROWN WHITE BLACK SILVER, GOLD
  • 36. Copyright 2007 by Prentice Hall Perception • The process by which an individual selects, organizes, and interprets stimuli into a meaningful and coherent picture of the world • How we see the world around us Sketchers
  • 37. Copyright 2007 by Prentice Hall Aspects of Perception Selection Organization Interpretation
  • 38. Copyright 2007 by Prentice Hall Perceptual Selection • Selective Exposure • Selective Attention • Perceptual Defense • Perceptual Blocking • Consumers seek out messages which: – Are pleasant – They can sympathize – Reassure them of good purchases Concepts
  • 39. Copyright 2007 by Prentice Hall Perceptual Selection • Selective Exposure • Selective Attention • Perceptual Defense • Perceptual Blocking • Heightened awareness when stimuli meet their needs • Consumers prefer different messages and medium Concepts
  • 40. Copyright 2007 by Prentice Hall Perceptual Selection • Selective Exposure • Selective Attention • Perceptual Defense • Perceptual Blocking • Screening out of stimuli which are threatening Concepts
  • 41. Copyright 2007 by Prentice Hall Perceptual Selection • Selective Exposure • Selective Attention • Perceptual Defense • Perceptual Blocking • Consumers avoid being bombarded by: – Tuning out Concepts
  • 42. Copyright 2007 by Prentice Hall Organization • Grouping • Closure • People group stimuli to form a unified impression or concept. • Grouping helps memory and recall. Principles
  • 43. Copyright 2007 by Prentice Hall Organization • Grouping • Closure • People have a need for closure and organize perceptions to form a complete picture. • Will often fill in missing pieces • Incomplete messages remembered more than complete Principles
  • 44. Copyright 2007 by Prentice Hall Interpretation • Physical Appearances • First Impressions • Jumping to Conclusions • Halo Effect • Positive attributes of people they know to those who resemble them • Important for model selection • Attractive models are more persuasive for some products Perceptual Distortion
  • 45. Copyright 2007 by Prentice Hall Interpretation • Physical Appearances • First Impressions • Jumping to Conclusions • Halo Effect • First impressions are lasting • The perceiver is trying to determine which stimuli are relevant, important, or predictive Perceptual Distortion
  • 46. Copyright 2007 by Prentice Hall Interpretation • Physical Appearances • First Impressions • Jumping to Conclusions • Halo Effect • People tend not to listen to all the information before making conclusion • Important to put persuasive arguments first in advertising Perceptual Distortion
  • 47. Copyright 2007 by Prentice Hall Interpretation • Physical Appearances • First Impressions • Jumping to Conclusions • Halo Effect • Consumers perceive and evaluate multiple objects based on just one dimension • Used in licensing of names Perceptual Distortion
  • 48. Copyright 2007 by Prentice Hall The halo effect helps Adidas break into new product categories.