Consumer Decision Making

Three Perspectives on Decision Making

Decision making perspective

• High involvement decisions

• Low involvement decisions Experiential perspective Behavioral influence perspective

Decision Making PerspectiveHigh Involvement Decisions

ProblemRecognition

Extensive Search

ExtendedAlternative Evaluation

Complex Choice

AcquisitionEvaluation

Decision Making PerspectiveLow Involvement Decisions

ProblemRecognition

Limited Search

MinimalAlternative Evaluation

Simple ChoiceProcesses

AcquisitionEvaluation

Experiential Perspective

Problem Recognition(affect driven)

Search forAffect-based Solutions

Alternative Evaluation(comparison of affect)

Choice(affect-based)

Acquisition Evaluation

Behavioral Influence Perspective

Search (learned Response)

Choice (behaviorresults fromreinforcers)

Acquisition Evaluation(self-perception process)

ProblemRecognition(results fromdiscriminativestimulus)

Initial vs. Repeat Purchases Initial purchases

• Tend to require more extensive problem solving

Repeat purchases

• Tend to require limited problem solving, sometimes habitual decisions

Basic Decision Making ProcessProblem/Need Recognition

Information Search

Evaluation of Alternatives

Purchase

Post-Purchase Evaluation

Problem/Need Recognition Consumer recognizes a gap or discrepancy

between his/her current state and his/her desired state.

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

Determinants of External Search

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)

Consideration Set

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.

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.

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.

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.

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.

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.

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”

Purchase Decision

Post-Purchase Evaluation Consumers evaluate purchases during

consumption process.

Three possible outcomes.

Postpurchase cognitive dissonance.

Complaining behavior.

Outcomes Actual product performance matches

prepurchase expectations

• Neutral Feeling

Outcomes Actual product performance exceeds

prepurchase expectations.

• Positive disconfirmation of expectations

• Satisfaction

Outcomes Actual product performance is below

prepurchase expectations.

• Negative disconfirmation of expectations

• Dissatisfaction

A Continuum of Satisfaction

Dissatisfaction DelightedSatisfaction

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

Decision to complain... Is based on:

• Level of dissatisfaction

• Importance of decision/purchase

• Costs/benefits of actions

• Personal characteristics

• Attribution of blame

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