Consumer Behavior Chap 8

• 1) Problem Recognition
• 2) Information Search
• 3) Evaluation of Alternatives
• 4) Product Choice

• Having too many choices. This is called:
• Consumer hyperchoice

A condition where a large number of available options forces us to make repeated choices that may drain psychological energy while it saps our abilities to make smart decisions.

• Rational.
• This is where we calmly and carefully integrate as much information as possible with what we already know about the product, weigh the pros and cons of each alternative, and then make a satisfactory decision.

It assumes that we collect just as much data as we need to make an informed decision.

The rewards received after the additional information.

• That they should study the steps in decision making to understand how consumers
• Obtain information
• How they form beliefs
• What criteria they use to make product choices

No

This occurs when our initial impulse purchases actually increase the liklihood that we will buy even more. (Plunge into a spending spree)

• RSC-processes information analytically and sequentially using roles of logic.
• ESC-processes information more holistically and in parallel

We evaluate the effort we'll need to make a particular choice and then we tailor the amount of cognitive 'effort' we expend to get the job done.

when we decide to buy something on impulse because it just looks cool.

Decisions involving this correspond most closely to the traditional decision-making perspective.

Usually more straightforward and simple.

Low cost products, frequent purchasing, low involvement, little thought

• Motivation
• Information Search
• Alternative Evaluation
• Purchase

Can get frozen in one brand and then never try a new one.

• 1st
• Run out of product. Realize a need or want.
• Actual State need recognition
• Ideal State opportunity recognition

Trying to create demand for a general category

Trying to create demand for a specific brand

The process by which we survey the environment for appropriate data to make a reasonable decision.

Recognize a need and then search the marketplace for specific information.

Browsing just for the fun of it or because you like to stay up-to-date on what's going on in the marketplace.

you know this

• Analyses of people's responses to situations illustrate the principles of mental accounting.
• The problem we pose

This is the name given to the decision making bias caused by the fact that if you've paid for something you're more reluctant to waste it.

Describes people who are so obsessed with preparing for the future that they can't enjoy present.

Bias where we emphasize our losses more than our gains.

Describes how people make choices-it defines utility in terms of gains and losses.

The belief that there may be negative consequences if you use or don't use a product or service.

Monetary, functional, physical, social, psychological

The alternatives a consumer knows about

The ones from the evoked set that he actually considers.

This term refers to a set of beliefs and the way we organize these beliefs in our minds.

• Middle level. Typically the most useful to classify products.
• Broader category. More abstract.
• More specific. Often include individual brands.

• Positioning strategy-consider the product within a given category. eg-incredible edible egg, orange juice all day.
• Identify competitors
• Create an exemplar product-more easily recognize and recall. Brands we strongly associate with a category gets to call the shots.
• Locate products in a store-product categorization. fitting into categories.

The dimensions we use to judge the merits of competing options.

The features we actually use to differentiate among our choices.

• 1)point out there are significant differences
• 2)Supply the consumer with a decision making rule (if...then...)
• 3)Convey a rule that is consistant with how the person made the decision on prior occasions.

• Uses functional magnetic resonance imaging, which is:
• a brain scanning device that tracks blood flow as we perform mental tasks.

An intermediary that helps to filter and organize online market information so that customers can identify and evaluate alternatives more efficiently. eg Yahoo!, directories, forums, fan clubs

The idea is that we no longer need to rely on only big hits to find profits. Companies can make money if they sell small amounts of items that only a few people want, if they sell enough different items.

Sophisticated software programs that use collaborative filtering technologies to learn from past user behavior in order to recommend new purchases. eg Amazon's recommendations

A software tool that tries to understand a human decision maker's multiattribute preferences for a product category as it asks the user to communicate his preferences.

The people who supply the customer reviews that shoppers rely on to guide search.

Mental rules of thumb. What we fall back on when limited problem solving occurs prior to making a choice.

The visible element that communicates some underlying quality. Eg used car, outside shiney.

The associations we have among events that may or may not actually influence eachother.

• The assumptions we form about companies, products and stores.
• Brand, store, price/discount/sales, advertising and sales promotion, product/packaging.

The tendency to prefer products or people of one's own culture to those of other countries.

The tendency to prefer the number one brand over the competitor.

Buying the same brand everytime you go to the store. Buying the brand out of habit merely because it requires less effort. "Unfreeze"

Compensatory and noncompensatory.

• When we feel that a product with a low standing on one attribute can't compensate for its flaw even if it performs better on one attribute.
• Lexicographic-best on the most important attribute; elimination by aspect-same as lexicographic, except he imposes specific cut-offs; conjunctive-processing by brand, not attribute.

• Gives a product a chance to make up for its shortcomings. More involved with purchases.
• Simple additive-largest number of positive attributes; weighted additive-also takes into account the relative importance of positively rated attributes.