Consumer Decision Process and Problem Recognition
Four concerns related to problem recognition
1. Discovering Consumer Problems
2. Responding to Consumer Problems
3. Helping consumers recognize problems
4. Suppressing problem recognition
External Search Costs vs Benefits (and characteristics)
4 factors that influence the expected benefits and perceived costs of online and offline search
Characteristics: Market, Product, Consumer, Situation
Attributes used to indicate another attribute; high price could infer high quality
These operate more strongly when consumers lack the expertise to make informed judgements, motivation/interest is low, or when there is a lack of other info
Surrogate Indicators
Influences within a retailer induce additional information processing and affect the final purchase decision
Unplanned purchases
Reminder and Impulse Purchases
In-Store and Online Influences on Brand Choices
How do you attempt to develop an ongoing relationship with customers
-Develop core product to build relationship
-Customize the relationship to the customer
-Augment the core product with extra benefits
-Price to encourage loyalty
-Market to employees so they perform well
Loyalty programs
Types of Consumer Problems
Active: one the consumer is aware of or will become aware of in time
Inactive: one of the consumer is not aware exists
Each requires a different marketing strategy
Marketing Strategy and Online Information Search: three main problems to solve
Three major strategic issues to answer:
-How can we drive info to our customers?
-How can we drive consumers to our info?
-How can online selling be used with existing channels?
Importance varies among individuals and also within the same individual over time
Three factors: usage situation, competitive context, advertising effects
Relative Importance and Influence of Evaluative Criteria
what are Barriers to online shopping?
Offline stores are still the top ranked purchasing channel for most consumers
Many prefer to buy in-store to see the product in person; others don't want to pay shipping fees, among the other barriers
Most frequent in high involvement extended decision making where trade-offs among attributes create conflict, negative emotions, and decision delay
Consumption guilt
Dissonance Occurances
Consumer's Desire is determined by what?
Magnitude of the discrepancy between desired and actual states
- Relative importance of the problem
Name the five Sources of Information
Five Primary Sources of info available to consumers: memory, personal sources, independent sources, marketing sources, experiential sources
Measurement of Evaluative Criteria
To develop a sound marketing strategy, we must determine:
1. which evaluative criteria are used by the consumer
2. how the consumer perceives alternatives on each criterion
3. The relative importance of each criterion
Outlet Image, Retailer Brands, Retail Advertising, Outlet Location and Size
Attributes Affecting Retail Outlet Selection
-First touchpoint with brand/product
-Point of differentiation among competitors
-Opening/unboxing experience
-Personalized inserts/messages
Packaging Influence in Buying Decision
what are the Types of Decision Making?
-Nominal Decision Making: Brand Loyal or Repeat purchases
-Limited Decision Making
-Extended Decision Making
what is the awareness set made up of?
Awareness Set is made up of:
-Alternatives given consideration (specific alternative purchased and alternatives considered but not purchased)
-Inert set (backup alternatives)
-Inept set (avoided alternatives)
Nature of Evaluative Criteria
Usually associated with benefits; can differ in type, number, or importance
Type: tangible vs intangible
Number: Fewer for simple products
Importance: affects which brands are selected
Displaying product online or in store
Webrooming and Showrooming
-Consumer performance expectations and perceived performance for a product are not independent; performance needs to be in line with expectations
-Satisfaction with the purchase is a function of consumer perception of how the product performs compared to consumer expectations
Evaluation Process
name the Consumer Decision Process Order
This creates the decision process of: Situations, Problem Recognition, Information Search, Alternative Evaluation and Selection, Outlet Selection and Purchase, Postpurchase Process
Consumer Decisions require information on:
-Evaluative criteria for the solutions to the problem
-Existence of various alternative choices
-Performance level or characteristic of each alternative solution on each evaluative criterion
Types of Consumer Choice Processes
Not mutually exclusive, and combinations may be used in a single decision
-Affective choice
-Attitude based choice
-Attribute based choice
Channels: physical stores, internet and apps, catalogs
Example: look online for deals, product info then buy in-store; order online, pickup in-store
Omni-Channel Retailing
-Occurs before, during or after product use
-Packaging that uses a minimal amount of resources is crucial, both economic and social responsibility reasons
-Recycling
Disposition