Consumer Behavior
Decision making
Types of Purchase
Behavior and the
Consumer Decision
Making Process
Consumer Behavior
Decision making
Outline
• Types of purchase decisions
• Need arousal
• Information acquisition
(types of search, determinants of search, and
sources of information)
• Evaluation of alternatives and choice
(choice sets, choice alternatives, choice criteria,
choice heuristics, context effects)
Consumer Behavior
Decision making
The purchase cube
Deliberate purchases
HI
Extended
purchase
decision
making
Symbolic
purchase
behavior
LI
Repetitive
purchase
behavior
Hedonic
purchase
behavior
Think
Feel
Spontaneous purchases
HI
Promotional
purchase
behavior
Exploratory
purchase
behavior
LI
Casual
purchase
behavior
Impulsive
purchase
behavior
Think
Feel
Consumer Behavior
Decision making
Types of purchase motives
Functional motives
Problem solving (problem
removal or avoidance)
Quality and performance
Price and value
Familiarity
Convenience
Normal depletion
Psycho-social motives
Social approval
Self-expression
Variety and change
Emotional stimulation
Intellectual stimulation
Sensory gratification
Consumer Behavior
Decision making
FCB grid for some common products
high involvement
life insurance
car battery
35 mm camera
washer/dryer
portable TV
suntan lotion
think
dry bleach
salad oil
sports car
stereo component
expensive watch
perfume
wine for dinner party
complexion/face soap
jeans
feel
toothpaste
greeting card
fast food restaurant
liquid bleach
disposable razor
paper towels
regular beer
liquid
hand soap salty snacks
low involvement
Consumer Behavior
Decision making
Need arousal
Current (initial)
state
Desired (end)
state
Discrepancy ?
Need arousal
• generic
• selective
Consumer Behavior
Decision making
Information acquisition
• ongoing search: motivated by intrinsic enjoyment
of the search process and the desire to build an
information bank;
• prepurchase search: motivated by the desire to
make better purchase decisions;
– internal:
– external:
Consumer Behavior
Decision making
Internal search
Experiences
0/+
++
Brand C
Brand A
Purchase
goal
Attribute
information
Brand B
+
Consumer Behavior
Decision making
Determinants of external search effort
Environmental and situational variables:
– number of alternatives
– product differences
– store distribution (distance)
– time pressure
Product characteristics:
– price
– social visibility (style and appearance)
– perceived risk
– number of crucial attributes
Consumer characteristics:
– prior knowledge and experience
– involvement
– positive attitude toward search
– education
– income
– age
+
+
–
–
+
+
+
+
–
+
+
+
–
–
Consumer Behavior
Decision making
Information sources
personal sources
commercial
sources
noncommercial
sources
nonpersonal sources
Consumer Behavior
Decision making
Alternative evaluation
• the following information is particularly relevant
to making a choice:
– choice alternatives (e.g., brands, stores);
– choice criteria (e.g., product or store
attributes);
• in order for a product or store to be chosen, it has
to be in the consumer’s consideration set and it
has to be perceived favorably on the choice
criteria that are important to the consumer;
Consumer Behavior
Decision making
A choice sets model of retail selection
(Spiggle and Sewall 1987)
unawareness
set
inert
set (0)
inaction
set (+/0)
quiet
set (+/0)
retailer not
chosen (+/0)
awareness
set
evoked
set (+)
action
set (+)
interaction
set (+)
retailer
chosen (+)
total set
inept
set (-)
reject set (-)
Consumer Behavior
Decision making
In-class exercise: Choice sets
Choose a product category in which three acquaintances who
are not in this class made a recent purchase (e.g., soft drinks,
fast food restaurants, energy bars, etc.). Ask your
respondents to list all the brands in the product category that
they were aware of prior to making the purchase (awareness
set), and then have them indicate which brands they
considered buying (consideration set), which brands they
were indifferent toward (inert set), and which brands they
knew they didn’t want to buy (inept set). Of course, you
should also keep track of which brand they actually
purchased. Try to find out from your respondents why
different brands belong to each of the different choice sets.
•
Consumer Behavior
Decision making
Purchasing a diamond engagement ring
Awareness Evoked
set
set
Action Interaction Choice
set
set
set
Fine Jewels
90
(10)
74
(12)
56
(15)
36
(23)
9
Hargrave
30
(13)
19
(21)
13
(30)
9
(44)
4
A.A. Gray
28
(2)
10
(6)
5
(13)
1
(40)
<1
Mass Mart
69
(0)
7
(0)
4
(0)
1
(0)
0
Consumer Behavior
Decision making
Choice heuristics
• if an overall evaluation for each brand is
available in memory, the decision can be
made based on affect referral;
• attribute-based choice heuristics differ
based on whether they are compensatory or
noncompensatory and whether processing
occurs by brand or by attribute;
• phased decision strategies are often used in
practice;
Consumer Behavior
Decision making
Attribute-based choice heuristics
Processing
by brand
Processing
by attribute
Compensatory
Noncompensatory
weighted additive rule
equal weight heuristic
conjunctive heuristic
additive difference rule
lexicographic heuristic
elimination by aspects
heuristic
Consumer Behavior
Decision making
In-class exercise: Decision rules
Use the data in the table below to decide which product a consumer
would choose if (s)he were to use the following decision rules or
heuristics: (a) weighted additive rule (according to this rule, the
overall score is the weighted sum of the subjective values, where the
weights are the attribute importances); (b) equal weight heuristic
(according to this rule, unit weights are used for all attributes); (c)
conjunctive heuristic; (d) lexicographic heuristic; and (e) elimination
by aspects heuristic (read Chapter 7 in Peter and Olson, esp. Exhibit
7.4, before doing this assignment). Note: Numbers in parentheses are
subjective ratings on a scale from 1 to 10, with 10 being the maximum
score. Use these ratings in your calculations. The cutoff levels refer to
the minimum or maximum acceptable standard on a given attribute
(e.g., >5 on image means that the rating on this attribute has to be
greater than 5 in order for the car to be considered).
Choosing a mid-size sedan
Price
Warranty
(years/
miles)
J.D.Power
mechanical
quality
Crash
test
rating
Horsepower
EPA mileage
(city/
highway)
(6)
$19,800
(7)
3/36K
(7)
3
(6)
Excellent
(10)
175
(8)
23/29
(8)
(8)
$17,095
(8)
3/36K
(7)
4
(8)
Excellent
(10)
160
(7)
24/34
(9)
(9)
$19,025
(7)
3/36K
(7)
3
(6)
Excellent
(10)
160
(7)
24/34
(9)
(6)
$21,200
(5)
3/36K
(7)
3
(6)
Good
(8)
153
(5)
20/27
(7)
(10)
$25,045
(4)
5/50K
(9)
4
(8)
Excellent
(10)
180
(9)
22/29
(8)
Attribute
importance
6
10
9
8
6
5
7
Cutoff level
>(5)
<$22,000
>2/30K
>2 (6)
at least
good
>170
>20/27
Brand
Image
Nissan Altima
Honda Accord
Toyota Camry
Ford Taurus
VW Jetta
Consumer Behavior
Decision making
The cost-benefit approach to
consumer choice
• question of how consumers decide which choice
heuristic to use in a given case;
• the cost/benefit framework suggests that rule
usage depends on the costs and benefits associated
with the application of a given heuristic;
• important components of costs and benefits are the
cognitive effort required by a choice heuristic and
the accuracy of the choice resulting from the use
of a heuristic;
Consumer Behavior
Decision making
Contextual influences on
consumer decision making
• because consumers’ preferences are often
not well-formed, seemingly minor
variations in the way the decision is framed
(either by the consumer or the marketer) can
have a profound effect on choice;
• marketers can influence consumer decision
making by manipulating various task and
context factors;
Consumer Behavior
Decision making
Effect of choice set composition on
consumers’ purchase decisions:
The attraction effect
Choice 1:
Cross pen
$6
Choice 2:
Cross pen
inferior, lesser-known pen
$6
Consumer Behavior
Decision making
Effect of choice set composition on
consumers’ purchase decisions:
The compromise effect
Brand B costs $350, w/ a picture quality of 85
Brand C costs $299, w/ a picture quality of 80
Same as above, except that there is also Brand A,
at a price of $503 and a picture quality of 100
Same as above, except that there is also Brand D,
at a price of $146 and a picture quality of 65
Consumer Behavior
Decision making
Methods for studying decision making
• input-output approaches: a decision process is
hypothesized and factors that affect this process are
identified; if manipulations of these factors (inputs) lead to
the predicted results (outputs), this is interpreted as
evidence in support of the underlying process;
• process tracing approaches: ongoing decision processes
are measured directly;
– verbal protocols: concurrent or retrospective thought
verbalizations;
– information acquisition approaches: information display boards,
eye movement recording, and computer-based information
displays;
– chronometric analysis: analysis of response times;
Consumer Behavior
Decision making
Brand personality
• idea that brands have “personalities” (sets of
human characteristics) and that consumers
may use brands for self-expressive purposes;
• recent research by Aaker (1997) suggests
that a brand’s personality can be described in
terms of five underlying dimensions;
• according to the image congruence
hypothesis, consumers prefer brands that
have images similar to their own self-image;
Consumer Behavior
Decision making
A brand personality framework
Brand
personality
Sincerity
Excitement
Competence
Sophistication
Ruggedness
• down-to-earth
• honest
• wholesome
• cheerful
• daring
• spirited
• imaginative
• up-to-date
• reliable
• intelligent
• successful
• upper class
• charming
• tough
• outdoorsy