Chapter 8
Judgment & Decision Making
Based on High Consumer Effort
Learning Objectives~ Ch. 8
1.
To understand why judgment & decision making is
important in consumer behavior
2.
To access types of cognitive models for high-effort
decision making & influencing
3.
To know the role of affective decisions in high-effort
situations
4.
To identify types of high-effort decisions made by
consumers & how marketers can influence them
Judgment & Decision Making:
High Consumer Effort
High-Effort Judgment Processes
Estimation of likelihood
Goodness/badness
– Anchoring/adjustment
– Imagery
Conjunctive probability assessment
Illusory correlation
Biases in Judgment Processes
Confirmation
Self-positivity—prime
Negativity
Mood
Prior brand evaluations
What past brand experiences have
biased your judgment about future
brand consumption?
High-Effort
Consumer Decisions~1
Deciding which brands to consider
– There is a vast menu of choices that you
must break down to possible choices
– Consideration set (evoke set)
Deciding what is important to the
choice
– Goals
– Time
– Framing
High-Effort
Consumer Decisions~2
Deciding what offerings to choose
– Thought-based decisions
• Brands
• Product attributes
• Gains & losses
– Feeling-based decisions
• Appraisals & feelings
• Affective forecasts
High-Effort
Consumer Decisions~3
Deciding whether to make a decision now
– Decision delay
Deciding when alternatives cannot be
compared
High-Effort
Decision Making Processes
Consideration set
Inept set
Inert set
What are the differences among these sets?
High-Effort
Thought-Based Decisions
Cognitive decision-making models
Types of decision processes
Compensatory vs. noncompensatory
Brand vs. attribute
Compensatory brand-processing models
Additive difference model
Cognitive Choice Models
Brand Processing Models
Compensatory Models
– Multiattribute models (Theory of Reasoned Action
[TORA])
Noncompensatory Models
– Conjunctive model
– Disjunctive model
– What is the main difference between
compensatory and noncompensatory models?
Brand vs. Attribute Models
Noncompensatory
Noncompensatory
brand-processing
attribute-processing
models
models
- Cutoff levels
- Models
•
Conjunctive
•
Disjunctive
- Lexicographic
- Elimination-byaspects
Multiple models
Noncompensatory Attribute
Processing Models
Elimination by Aspects
– Attributes ordered by importance; alternatives
acceptable on first attribute proceed to evaluation
on further attributes
– I will eliminate any brands with a value of 3 or
below, beginning with most important attribute
– Note the “most important” attribute is up to the
consumer (e.g., car safety, style, value/gas
mileage, etc.)
Decisions Based on
Gains & Losses
Prospect Theory
– Losses have more influence than gains
– Think-have you ever spent more on gas to “save” on
a price?
– Consumers have stronger reaction to price increases
than price decreases
Endowment effect
– Ownership increases value (& loss) associated with
an item
– This is why the 24 hour test drive of vehicles is often
a success
High-Effort
Feeling-Based Decisions
Affective decision making:
decisions are made in a more holistic manner on the
basis of feelings or emotions
What is an example of an affective-based purchase
that you have made?
Was it a good purchase in retrospect? Why/not?
Affective Decision-Making
Appraisal Theory: how your emotions are determined by
the way you appraise the situation; explains how & why
certain emotions can affect future judgments & choices
Affective Forecasting: you predict how you will feel in the
future
– Valence
– Intensity
– Duration
Imagery: you imagine yourself consuming a product or
service; a key role in emotional decision making
Additional
High-Effort Decisions
1. Decision delay
– Decision too risky
– Decision entails unpleasant task
2. Decision making when alternatives cannot be
compared (noncomparable decisions)
Noncomparable Decisions
Noncomparable Decisions: process of making
decisions about products or services from different
categories (e.g., weekend entertainment)
Consumers use an alternative-based strategy OR an
attribute-based strategy
2 Main Consumer Strategies:
– Alternative-Based (top-down processing): overall
evaluation, may use pros & cons
– Attribute-Based (bottom-up processing): consumers
form abstract representations to help them compare
options
Contextual Effects on
Consumer Decision Making
Consumer Characteristics
Task Characteristics
Task Definition/Framing
Presence of a Group
Consumer Characteristics
Affecting Decision Making
Expertise
Mood
Time pressure
Extremeness aversion
Metacognitive experiences
Task Characteristics
Affecting Decision Making
Information availability
Information format
Trivial attributes
Group Decision Making
How does your consumer behavior/decisions
change when you are alone vs. with: your
friends? parents?
Individual-alone goals
Individual-group goals
Group Context
& Decision Making
Self-Presentation
Minimizing Regret
Information Gathering
Goal Classes Affecting
Decision Making
© GEICO 2008
Geico gecko is an effective retrieval cue in insurance;
generally a high-effort decision. Geico has used repetition to
ensure that the gecko/Geico link is stored in consumers’
long-term memory.
Courtesy Daimler AG
Automobiles: high effort consumer decision
Smart car has been touted as being environmentally friendly.
This ad demonstrates another benefit of the Smart car: the
goal of parking in a city.
Questions?