Rationality vs. Emotions: Insights into Consumer Decision Making Professor West.
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Transcript of Rationality vs. Emotions: Insights into Consumer Decision Making Professor West.
Means-End Chain Analysis:
Consumer behavior is both: Purposeful
We strive to achieve short-term, and long-term goals
Revealing Our behavior reflects our values Trade-offs
Understanding Consumer Motives Motivations are the underlying reasons for
behaviorPreservation Growth
Cognitive Consistency Attribution Categorize Objectification
Autonomy Stimulation Teleological needs Utilitarian needs
Affective Tension reduction Expression Ego defense Reinforcement
Assertion Affiliation Identification Modeling
Laddering Technique
Values
Attributes
Consequences
I: “Why is it important to you to use a camcorder that allows for five hours on one tape and one battery?”R: “Because I can take it to outside events, like baseball games.”I: “Why is that important to you?”R: “It assures me that I will capture important moments in my kids lives without worrying.”I: “Why is that important to you?”R: “Being a good parent requires that kids are left with visual images of their childhood to enjoy as adults..”
Motivational Conflict
Approach-Approach Choosing between two attractive alternatives (e.g.,
two great job offers) Approach-Avoidance
A choice situation that entails both positive and negative consequences (e.g., the desire to stay healthy but an aversion to exercise)
Avoidance-Avoidance A choice between undesirable outcomes (e.g.
breast self-exams, colonoscopy, seeing your dentist)
Understanding Motives
Effective communication requires understanding what consumers are looking for, and why.
Consumer Involvement
Involvement is the “perceived relevance” based on inherent needs, values, and interests
From “inertia to passion” Involvement determines the degree of effort or
energy expended toward the object or activity
Many faces Product, Message-related, Situational, Purchase
Consumer-side
Traditional Model of Decision Making
ChoiceAlternativeEvaluation
SearchNeed
RecognitionPost-Purchase
Evaluation
Consumer Decision Making
Consumer-side
Marketer-side
Action Desire Interest Awareness
ChoiceAlternativeEvaluation
SearchNeed
RecognitionPost-Purchase
Evaluation
Consumer Decision Making
Consumers make a wide variety of choices that range from life-altering (the decision to go to graduate school, getting married) to mundane (filling your car with gasoline).
Nature of Processing
Midrange Problem Solving
Habitual Problem Solving
Extended Problem Solving
PassionInertia
Limited Problem Solving
Simple Elaboration
From Inertia to Passion
Nature of the Decision:
First time vs Repeat purchase
Purchase for Self versus Another
Functional products (e.g. washing machine, car)
Experiential products (e.g. perfume, clothing)
Consumers are “cognitive misers” Heuristics are used as shortcuts to
decision making What might some of these be?
Ask a friend or family member By what my mother always buys Find the cheapest Pick the compromise alternative
…
ChoiceAlternativeEvaluation
SearchNeed
RecognitionPost-Purchase
Evaluation
Rational Decision Making:
Need Recognition
Ideal State
Ideal State Ideal State
Actual State Actual State
Actual State
Status Opportunity Problem Quo Recognition Recognition
How are Needs Activated?
Changed circumstances Graduation, new job, marriage, first baby …
Product acquisition DVD player, Xbox
Product consumption Toothpaste, milk, gasoline…
Product innovation Jump Drives
Marketing influence
The Role of Self-Concept
Alter the buyer’s perception of “ideal self”
IdealSelf
ActualSelf
ExtendedSelf
Products that enhance “self-concept” reduce the dissonance between the ideal and actual self.
Information Search
Types of Information Search Information -- observable prior to
purchase Credence Information – product claims that are
not readily observed even post purchase Experience Information -- can be obtained from
direct experience with the product or service
Information Search
Search is usually limited Surveys indicate that 50% of consumers shop at
a single store for a durable good, only 30% look at more than one brand of appliance
Highlights why top-of-mind awareness, and product differentiation are crucial
What Determines Extent of Search? Cost
Effort, time, delay, immediacy of need, money The internet can lower search costs
Benefits Savings, performance, satisfaction, avoidance of
regret, ease of justification
Evaluation & Choice
Determine criteria to be used for evaluation of products
Assess the relative importance of the each criteria
Evaluate each alternative based on the identified criteria
Criteria for the purchase of a car: Handling Longevity Reliability Safety Space Styling
Evaluating Alternatives
Assessing Importance: ei
Space 5 Reliability 4 Safety 4 Longevity 3 Handling 3
* Importance: 5=Most Important, 1=Least Important
Evaluating Alternatives
Beliefs Regarding Product Performance:bi’s
Importance
ei
Toyota
Sienna
Subaru
Outback
Volvo
Cross Country
Space 5 4 2 4
Reliability 4 3 4 3
Safety 4 3 3 4
Longevity 3 2 4 4
Handling 3 1 4 2
Evaluating Alternatives
Product Evaluation: 4=Excellent, 3=Very Good, 2=Good, 1=Fair
Decision Rules
Compensatory Rule: a perceived weakness of one attribute may be offset or compensated for by the perceived strength of another attribute Economic models of rational behavior whereby
consumers maximize utility
Noncompensatory Rule: a product’s weakness on one attribute cannot be offset by strong performance on another attribute. Descriptive models of behavior that capture how
consumers simplify their decision making
Simple additive (Equal Weight): bi
The consumer adds the product evaluations across the set of salient evaluative criteria. The product with the largest score is chosen.
Weighted additive: biei
Judgments of product evaluations are weighted according to importance
Compensatory Decision Rules
biToyota
Sienna
Subaru
Outback
Volvo
X-Country Space 4 2 4 Reliability 3 4 3 Safety 3 3 4 Longevity 2 4 4 Handling 1 4 2
13 17 17
Simple Additive (Equal Weight)
bieiImportance
Toyota
Sienna
Subaru
Outback
Volvo
X-Country Space 5 4 (20) 2 (10) 4 (20)
Reliability 4 3 (12) 4 (16) 3 (12)
Safety 4 3 (12) 3 (12) 4 (16)
Longevity 3 2 (6) 4 (12) 4 (12)
Handling 3 1 (3) 4 (12) 2 (6)
53 62 66
Weighted Additive
Noncompensatory Decision Rules Cutoffs/Thresholds: restriction or
requirements for acceptable performance
Signals (surrogate indicators) are product attributes used to infer other product attributes (e.g. high price often infers higher quality)
Noncompensatory Decision Rules Lexicographic strategy:
Brands are compared on their most important attribute, and the winner is chosen.
If there is a tie the second most-important is considered, and so on, until a choice is identified
Importance
Toyota
Sienna
Subaru
Outback
Volvo
X-Country
Space 5 4 2 4
Reliability 4 3 4 3
Safety 4 3 3 4
Longevity 3 2 4 4
Handling 3 1 4 2
Lexicographic Rule
Importance
Toyota
Sienna
Subaru
Outback
Volvo
X-Country
Space 5 4 2 4
Reliability 4 3 4 3
Safety 4 3 3 4
Longevity 3 2 4 4
Handling 3 1 4 2
Lexicographic Rule
Importance
Toyota
Sienna
Subaru
Outback
Volvo
X-Country
Space 5 4 2 4
Reliability 4 3 4 3
Safety 4 3 3 4
Longevity 3 2 4 4
Handling 3 1 4 2
Lexicographic Rule
Elimination by aspects (EBA): Brands are compared on an attribute by
attribute basis. Alternatives are eliminated that fall below the
consumer imposed cutoffs. Process continues until a single alternative
remains.
Noncompensatory Decision Rules
Cutoff = 3 Importance
Toyota
Sienna
Subaru
Outback
Volvo
X-Country
Space 5 4 2 4
Reliability 4 3 4 3
Safety 4 3 3 4
Longevity 3 2 4 4
Handling 3 1 4 2
Elimination by Aspects Rule
Conjunctive strategy (Satisficing): Brand are evaluated, one at a time, against a
set of thresholds established for each attribute.
The first brand that meets or exceeds the threshold for each attribute is chosen.
Noncompensatory Decision Rules
Cutoff = 2
Toyota
Sienna
Subaru
Outback
Volvo
Cross Country
Space 3 2 4
Reliability 3 4 3
Safety 3 3 4
Longevity 2 4 4
Handling 1 4 2
Conjunctive Rule
Marketing Insights
What can an auto manufacturer learn from this?
What can a dealer learn from this?
Marketing Insights
What can a marketing learn from this?
How is the process different than buying a car?
Marketer’s Job
To understand the process Anticipate where consumers will look for
information and make it easily accessible Be aware of what matters, (the head or the
heart) Search for opportunities to delight your
customers