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 Spontaneous purchases
Extended
Symbolic Promotional Exploratory
HI purchase HI
purchase purchase purchase
decision
behavior behavior behavior
making
Repetitive Hedonic Casual Impulsive
LI purchase purchase LI purchase purchase
behavior behavior behavior behavior
Think Feel Think Feel
Consumer Behavior
Decision making
Types of purchase motives
Functional motives Psycho-social motives
Problem solving (problem Social approval
removal or avoidance) Self-expression
Quality and performance Variety and change
Price and value Emotional stimulation
Familiarity
Convenience Intellectual stimulation
Normal depletion Sensory gratification
Consumer Behavior
Decision making
FCB grid for some common products
high involvement
life insurance
sports car
35 mm camera stereo component
washer/dryer
expensive watch
car battery portable TV
perfume
wine for dinner party
complexion/face soap
think suntan lotion jeans
toothpaste
feel
dry bleach
salad oil greeting card
fast food restaurant
liquid bleach
disposable razor regular beer
liquid
hand soap salty snacks
paper towels
low involvement
Consumer Behavior
Decision making
Need arousal
Current (initial) Desired (end)
state state
Discrepancy ?
Need arousal
• generic
• selective
Consumer Behavior
Decision making
In-class exercise
• What triggered the process and what was the basic
motivation for the purchase?
• How long did it take for the consumer to
acknowledge the need for this product? Was the
need general at first, or was there a specific brand
preference right away?
• What were the major influences on problem
recognition? Were marketing influences involved
in generating the consumer's desire for this
product?
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: information is retrieved from
memory;
– external: information is obtained from the
environment; research has found that the
level of external search is relatively low;
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 nonpersonal sources
commercial
sources
noncommercial
sources
Consumer Behavior
Decision making
In-class exercise (cont’d)
• How much search was involved in the purchase?
• How was the search conducted? Was the search
memory-based or was external information
consulted?
• What information sources were used?
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 inert inaction quiet retailer not
set set (0) set (+/0) set (+/0) chosen (+/0)
total set
awareness evoked action interaction retailer
set set (+) set (+) set (+) chosen (+)
inept reject set (-)
set (-)
Consumer Behavior
Decision making
Purchasing a diamond
engagement ring
100 50
80 40
60 30
40 20
20 10
0 0
n
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n
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n
n
s
n
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io
tio
es
tio
ct
at
ct
oi
at
en
Ac
en
Ac
ra
Ch
ra
er
er
ar
ar
te
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id
id
Aw
Aw
In
ns
In
ns
Co
Co
Fine Jewels Hargrave Fine Jewels Hargrave
A.A. Gray Mass Mart A.A. Gray Mass Mart
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
Compensatory Noncompensatory
Processing weighted additive rule
by brand conjunctive heuristic
equal weight heuristic
lexicographic heuristic
Processing additive difference rule elimination by aspects
by attribute
heuristic
Choosing a mid-size sedan
Warranty J.D.Power Crash EPA mileage
Brand Horse-
Price (years/ mechanical test (city/
Image power
miles) quality rating highway)
Nissan Altima $19,800 3/36K 3 Excellent 175 23/29
(6) (7) (7) (6) (10) (8) (8)
Honda Accord $17,095 3/36K 4 Excellent 160 24/34
(8) (8) (7) (8) (10) (7) (9)
Toyota Camry $19,025 3/36K 3 Excellent 160 24/34
(9) (7) (7) (6) (10) (7) (9)
Ford Taurus $21,200 3/36K 3 Good 153 20/27
(6) (5) (7) (6) (8) (5) (7)
VW Jetta $25,045 5/50K 4 Excellent 180 22/29
(10) (4) (9) (8) (10) (9) (8)
Attribute 6 10 9 8 6 5 7
importance
Cutoff level >(5) 2/30K >2 (6) at least >170 >20/27
good
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
Cross pen
$6
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 • daring
• reliable
• honest • spirited • upper class • tough
• intelligent • outdoorsy
• wholesome • imaginative • charming
• successful
• cheerful • up-to-date