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MKT 310 Chapter 2

by: Marissa Sarlls

MKT 310 Chapter 2 MKT 310

Marissa Sarlls
GPA 3.75

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MKT 310 Consumer Behavior Chp 2 book notes
Consumer Behavior
Dr. Dan Sheehan
Class Notes
25 ?




Popular in Consumer Behavior

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This 4 page Class Notes was uploaded by Marissa Sarlls on Sunday May 8, 2016. The Class Notes belongs to MKT 310 at University of Kentucky taught by Dr. Dan Sheehan in Spring 2016. Since its upload, it has received 24 views. For similar materials see Consumer Behavior in Marketing at University of Kentucky.


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Date Created: 05/08/16
MKT 310 Chapter 2: Decision Making and Consumer Behavior What’s your problem?  Every consumer decision we make is a response to a problem  The three categories of consumer decision making are cognitive, habitual, and affective  Constructive processing—a thought process in which a person evaluates the effort he or she will need to make a particular choice, and then tailors the amount of cognitive “effort” expended to make this decision o Mental budget—helps us estimate what we will consume over time so that we can regulate what we do in the present  Consumer’s preset expectations of how much they intend to spend on a shopping trip  Self-regulation—a person’s deliberate efforts to change or maintain his actions over time. o Ex: Dietcognitive decision in selecting a diet and makes list of “banned” foods; behaviorally, knows he has a snacking problem in mid afternoon so he argues with himself about long-term vs. short-term benefits of giving it up; emotional issues of inferiority or low self-esteem may be primary motivator to lose weight  Counteractive construal—exaggerating the negative aspects of behaviors that will impede the attainment of a goal as a strategy to avoid them and reach the goal  Cognitive—deliberate, rational, sequential  Habitual—behavioral, unconscious, automatic  Affective—emotional, instantaneous Consumer Involvement  Involvement—a person’s perceived relevance of the object based on their inherent needs, values, and interests; reflects our level of motivation to find information to solve a problem o Influenced by person, situation, or object (Figure 2.2 p. 39) o Object refers to a product (or brand), and ad, or a purchase situation  Our motivation to attain a goal increases our desire to acquire the products/services to satisfy it  Inertia—consumption at the low end of involvement, where we make decisions out of habit because we lack the motivation to consider alternatives Types of Involvement  Product involvement—a consumer’s level of interest in a particular item o Perceived risk—belief that a product has potentially negative consequences so more involvement  Monetary risk  Functional risk  Physical risk  Social risk  Psychological risk o Brand loyalty—repeat purchasing behavior that reflects a conscious decision to continue buying the same brand; reflects positive attitudes toward brand  “True-blue” users react more vehemently when a company alters, redesigns, or eliminate a favorite brand  Message involvement—properties of the medium and message content that influences a person’s degree of engagement with the message o Print is a high-involvement medium but television is a low-involvement medium because little control over content that shows up on the screen o Narrative transportation—the result of a highly involving message where people become immersed in the storyline  Situational involvement—the extent to which a shopper is engaged with a store, Web site, or a location where people consume a product or service o Want to personalize message at time of purchase (e.g. Person buys coffee in the morning at Dunkin Donuts sees as ad at cash register for breakfast sandwiches) Cognitive Decision Making  Cognitive purchase decision is the outcome of a series of stages that results in the selection of one product over competing options  Information processing perspective—according to this view, people calmly and carefully integrate as much information as possible with what they already know about a product, painstakingly weigh the pluses and minuses of each alternative, and arrive at a satisfactory decision  We still do what we can do simplify our choices if possible  Economics of information—perspective in which advertising is an important source of consumer information emphasizing the economic cost of the time spent searching for products o We form expectations of value of additional info and continue to search to the extent that the rewards of doing so (utility) exceed the costs o Utilitarian approach: we collect most valuable units of info first Steps in the Cognitive Decision-Making Process  Step 1: Problem Recognition—the process that occurs whenever the consumer sees a significant difference between his or her current/actual state (need recognition) of affairs and some desired or ideal state (opportunity recognition/“the upper funnel”); this recognition initiates the decision-making process o Ex: Richard realizes he’s fed up with a black-and-white TV that has bad sound reproduction  Step 2: Information Search—the process by which the consumer surveys his or her environment for appropriate data to make a reasonable decision; prepurchase search o Shopaholics engage in ongoing search o Internal search involves scanning our own brain memory banks to assemble info about different product alternatives o Search is greatest among those consumers who are moderately knowledgeable about product  Inverted-U (upside down) relationship between knowledge and external search effort o Because experts have a better sense of what information is relevant to the decision, they engage in selective search, which means their efforts are more focused and efficient  Novices more likely to depend on others’ opinions & “nonfunctional” attributes (brand) and process in a top-down manner by focusing more on the big picture o Ex: Richard surfs the Web to learn about TVs o Cybermediary—intermediary that helps to filter and organize online market information so that consumers can identify and evaluate alternatives more efficiently  Directories and portals, such as Yahoo!, are general services that tie together a large variety of different sites  Forums, fan clubs, and user groups offer product-related discussions to help customers sift through options  Intelligent agents—software programs that learn from past user behavior in order to recommend new purchases (suggesting based on past purchases)  Step 3: Evaluate Alternatives o Evoked set—those products already in memory plus those prominent in the retail environment that are actively considered during a consumer’s choice process  We are more likely to add a new product to the evoked set o Consideration set—the products a consumer actually deliberates about choosing o Knowledge structure—organized system of concepts relating to brands, stores, and other concepts  We place products into categories so new products are placed into existing categories  We represent a product in a cognitive structure at one of three levels:  Basic level category—have a lot in common but still different enough to provide a range of alternatives; most useful; fattening dessert vs. nonfattening dessert  Superordinate category—more abstract; Ex: Dessert  Subordinate category—often includes individual brands; Ex: Fattening includes Ice Cream, Pie, and Cake o The success of a positioning strategy hinges on the marketer’s ability to convince the consumer to consider its product within a given category  Category exemplars—brands that are particularly relevant examples of a broader classification…how people see the category in general and define the criteria o Evaluative criteria—the dimensions used by consumers to compare competing product alternatives o Determinant attributes—the attributes actually used to differentiate among choices o When we make habitual or emotional decisions, we probably use noncompensatory rules  Noncompensatory decision rules—decision shortcuts a consumer makes when a product with a low standing on one attribute cannot make up for this position by being better on another attribute  If an option doesn’t suit us in one dimension, we reject it and move on instead of think about how it could suit us in other ways  Lexicographic rule—select the brand that is the best on the most important attribute  Elimination-by-Aspects rule—the buyer also evaluate brands on the most important attribute but imposes specific cutoffs  Conjunctive rule—processing by brand; establishes cutoffs with brands  Step 4: Product Choice o Feature creep—the tendency of manufacturers to add layers of complexity to products that make them harder to understand and use; people think more features is better but it’s more frustrating  Step 5: Postpurchase evaluation—the final stage of consumer decision-making when we experience the product or service we selected o Consumer satisfaction/dissatisfaction (CS/D)—the overall attitude a person has about a product after it has been purchased Habitual Decision Making  We often rely upon “rules-of-thumb” or cues in the environment to make routine decisions  Purchase momentum—initial impulses to buy in order to satisfy our needs increase the likelihood that we will buy even more…going on a spending spree  Habitual decision making—choices made with little or no conscious effort Priming and Nudging  Priming—properties of a stimulus that evoke a schema that leads us to compare the stimulus to other similar ones we encountered in the past o Cues in the environment that make us more likely to react in a certain way even though we’re unaware of these influences  Nudge—a subtle change in a person’s environment that results in a change in behavior o Ex: one “nudge” that changes how people act is to switch from asking from asking consumers to “opt in” to a program to asking them to “opt out” of a program if they don’t want to participate…like being an organ donor  Default bias—a tendency in decision making that makes it more likely for people to comply with a requirement than to make the effort not to comply (ex: save for retirement if automatic) Decision-Making Biases and Shortcuts  Maximizing solution—the extensive cognitive decision strategies we use when we want to identify the best possible choice  Satisficing solution—a decision strategy that aims to yield an adequate solution (rather than the best solution) in order to reduce the costs of the decision-making process o Bounded rationality—a concept in behavioral economics that states since we rarely have the resources (especially the time) to weigh every possible factor into a decision, we settle for a solution that is just good enough o Behavioral economics—the study of the behavioral determinants of economic decisions  Framing—a concept in behavioral economics that the way a problem is posed (especially in terms of gains or losses) influences the decision they make  Mental accounting—principle that states that decisions are influences by the way a problem is posed in terms of gains or losses  Loss aversion means that we emphasize our losses more than our gains  Prospect theory—a descriptive model of how people make choices; defines utility in terms of gains and losses Heuristics: Mental Shortcuts  Heuristics—the mental rules of thumb that lead to a speedy decision o Covariation—assumed associations among events that may or may not actually influence one another (ex: we judge cars mechanical condition based on appearance) o Country of origin: a products “address”  Ethnocentrism—the belief in the superiority of one’s own country’s practices and products o Familiar brand names o Higher prices: many people assume higher prices mean better quality Affective Decision Making  We make some decisions based on the basis of an emotional reaction rather than as the outcome of a rational thought process Emotions and Consumption  Affect—the way a consumer feels about an attitude objects o Positive affect—the product makes the person feel good  Lovemark—a passionate commitment to one brand o Negative affect How Social Media Tap into Our Emotions  Sentimental analysis—a process (sometimes also called opinion mining) that scours the social media universe to collect and analyze the words people use when they describe a specific product or company o Word-phrase dictionary—sometimes called a library; codes the data…the program scans the text to identify whether the words in the dictionary appear  Compensatory decision rules—a set of rules that allows information about attributes of competing products to be averaged in some way; poor standing on one attribute can potentially be offset by good standing on another o More likely to apply in high-involvement situations…allows us to consider each alternative’s good and bad points more carefully to arrive at the overall best choice


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