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CONSUMER DECISION MAKING

CONSUMER DECISION MAKING. The decision process Effects of involvement Types of decision strategies. CONSUMER DECISIONS: Theory and Reality in Consumer Buying. Problem Recognition. Information Search. Evaluation of Alternatives. Purchase. Postpurchase Evaluation/ Behaviors. Theory

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CONSUMER DECISION MAKING

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  1. CONSUMER DECISION MAKING • The decision process • Effects of involvement • Types of decision strategies

  2. CONSUMER DECISIONS:Theory and Reality in Consumer Buying Problem Recognition Information Search Evaluation of Alternatives Purchase Postpurchase Evaluation/ Behaviors Theory Complications

  3. Types of Decisions and Involvement • Nominal • Brand loyal decisions • Repeat purchases • Limited decision making • Extended decision making

  4. Problem Types • Presence • Active • Inactive • Acceptance • Acknowledged • Unacknowledged/ denied • Specificity • Generic • Selective Me? Anger control problem? What do you mean?

  5. Categories of Alternatives • Awareness set • Consideration set (evoked set) • Inept set • Inert set All alternatives Inept set Evoked set Inert set Awareness set

  6. Discovering Consumer Problems • Activity analysis • Product analysis • Problem analysis • Human factors research • Emotion research

  7. Approaches to Search for Problem Solutions INTERNAL Memory Thinking EXTERNAL Word of mouth, media, store visits, trial CATALOG

  8. Issues in Decision Making • Compensatory vs. non-compensatory--can an exceptionally good rating on one attribute outweigh a bad one elsewhere? • Brand vs. attribute based processing

  9. Some Influences on Decisions • Temporal • Time pressure • Situation • Task definition and expectations • Mood

  10. Cost vs. Benefits of Search • Market Characteristics • Product Characteristics • Consumer Characteristics • Situation Characteristics

  11. Consumer Judgments • Heuristics • Availability • Representativeness • Simulation

  12. Economic Models • Expected utility • Utility functions • Prospect Theory • Asymmetry for gains and losses • Framing

  13. Other Models • Satisficing • Cognitive • Compensatory vs. non-compensatory • Affective • Simple strategies • Brand loyalty, brand familiarity • Country of origin • Price related • Minimizing regret

  14. Positioning Products as Problem Solutions • Category vs. brand promotion • Activating problems • Influencing desired state • Promotion of magnitude of discrepancy • Getting consumers to anticipate problems before need—e.g., • Insurance • Emergency supplies • Unexpected events

  15. Marketing Strategies Based on Decision Making • Maintenance • Disrupt • Capture • Intercept • Preference • Acceptance

  16. Variety Seeking and Impulse Buying • Variety seeking • need varies among consumers by optimal stimulation level (OSL) • Use innovativeness • Impulse purchases • Motivation • Consequences “Don’t give me that same old cola, that same old cola-- I want a rock’n’roller!”

  17. Roles/influence Information gatherers/holders Influencers Decision makers Purchasers Users Household Decision Making

  18. Roles/influence Information gatherers/holders Influencers Decision makers Purchasers Users Values--desired end states Strategies of Influence Constructive Bargaining Reasoning (sincere) Manipulative Impression management Authority Emotion Borderline Information gathering Household Decision Making

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