Consumer Behavior - Chapter 14 - Consumer Decision Process and Problem Recognition

Types of Consumer Problems:

1. Active Problem 2. Inactive Problem

Surveys and focus groups use one of the following approaches to problem identification:

1. Activity Analysis 2. Product Analysis 3. Problem Analysis

Nominal decisions have two categories:

1. Brand Loyal Decisions 2. Repeat Purchase Decisions

What are the four concerns related to problem recognition?

1. Discovering Consumer Problems 2. Responding to Consumer Problems 3. Helping Consumers Recognize Problems 4. Suppressing Problem Recognition

Types of Decision Making

1. Nominal Decision Making -Brand Loyal Purchases -Repeat Purchases 2. Limited Decision Making 3. Extended Decision Making

Types of Consumer Decisions (Chart)

1. Nominal Decision Making Problem Recognition: Low Information Search: Limited Internal Purchase Postpurchase: No dissonance, very limited evaluation 2. Limited Decision Making Problem Recognition: Generic Information Search: Internal + Limited External Purchase Postpurchase: No dissonance, limited Evaluation 3. Extended Decision Making Problem Recognition: Generic Information Search: Internal + External Purchase Postpurchase: Dissonance, complex evaluation

Active vs. Inactive Problem EX:

At one point in our life, we didn't know we needed a smartphone, aka minicomputer in our hands (inactive) and then someone convinced us to get a smartphone and we always purchase smartphones (active) most problems go from inactive to active

Brand Loyal Purchases EX:

Brand Loyal Purchases example is you buying Colgate toothpaste. You buy this brand each time because you think It meets all your oral hygiene needs

Brand Loyal Purchases

Commitment to the brand because the consumer has an affective (emotional) attachment.

Example of Nominal Decision Making

Consumer buys Campbell's without considering other brands, its price, etc.

Example of Limited Decision Making

Decision based only on buying the cheapest rolls

Discovering Consumer Problems

Intuition is the most common approach to discovering consumer problems Benefits are that it is inexpensive, fast, and easy Identifying consumer problems using online and social media Monitoring and tracking is NOT enough Problems need to be solved in a timely and appropriate manner

Suppressing Problem Recognition

Occasionally information is introduced in the market place that triggers problem recognition that some marketers prefer to avoid obviously marketers do not want their current customers to recognize problems with their brands effective quality control and distribution (limited out-of-stock situations) are important in this effort packages and package inserts that assure the consumers of the wisdom of their purchase are also common

(Discovering Consumer Problems) Responding to Consumer Problems

Once a consumer problem is identified, the manager may structure the marketing mix to solve the problem This can involve: -Developing a new product or altering an existing one -Modifying channels of distribution -Changing pricing policy, or -Revising advertising strategy

Repeat Purchases EX:

Repeat Purchases example is you may believe that all ketchup is about the same and you may not attach much importance to the product category or purchase

The Process of Problem Recognition (Chart)

The Nature of Problem Recognition: First stage in consumer decision process Problem recognition: the result of a discrepancy between a desired state and an actual state that is sufficient to arouse and activate the decision process Actual state is the way an individual perceives his or her feelings and situation to be at the present time Desired state is the way an individual wants to feel or be at the present time EX: you are bored on a Friday night. Your actual state is being bored, while your desired state is being pleasantly occupied

Active Problem

a problem where the consumer is aware of or will become aware of in normal course events Marketing Strategy: only require marketer to convince consumers that its brand is the superior solution

Nominal Decision Making

a.k.a habitual decision making, in effect involves no decision per se occur when there is very low involvement with the purchase a completely nominal decision does not even include consideration of the "do not purchase" alternative EX: you are out of toothpaste. You buy the same brand without considering alternatives

(Discovering Consumer Problems) Human Factors Research

attempts to determine human capabilities in areas such as vision, strength, response time, flexibility, and fatigue and the effect on these capabilities of lighting, temperature, and sound observational techniques such as slow-motion and time-lapse photography, video recording, and event recorders are particularly useful methods this type of research can sometimes identify functional problems that consumers are unaware of

Repeat Purchases

continue to buy the same brand though they do not have an emotional attachment to it

Product Analysis

examines the purchase or use of a particular product or brand. Consumers may be asked about problems associated with using a product or brand Ask about the product Dyson specifically and the issues with it. How can we improve our product that already exists for the future?

Activity Analysis

focuses on a particular activity to determine what problems consumers encounter during the performance of the activity consumer use the product and are asked what annoys them about the product. An example is the chord getting in the way

Selective Problem Recognition

involves a discrepancy only one brand can solve firms attempt to cause selective problem recognition to gain or maintain market share

(Helping Consumers Recognize Problems) Generic Problem Recognition

involves a discrepancy that a variety of brands within a product category can reduce increasing generic problem recognition generally results in an expansion of the total market Generic problem recognition exists when the problem is latent or of low importance and o It is early in the product life cycle o The firm has a high percentage of the market o External search after problem recognition is apt to be limited o It is an industry wide cooperation effort

Extended Decision Making

involves extensive internal and external search followed by a complex evaluation of multiple alternatives response to the high level of purchase involvement during postpurchase evaluation, doubts are likely and a thorough evaluation takes place occur when making big purchase decisions (house, cars, trips, etc.) emotional decisions may involve substantial cognitive effort

Limited Decision Making

involves internal and limited external search, few alternatives, simple decision rules on a few attributes, and little postpurchase evaluation middle ground between nominal and extended decision making involves recognizing a problem for which there are several possible solutions EX: you notice a display for Jell-o and pick up two boxes without seeking information beyond your memory of "Jell-o" is good; may have considered no other or limited alternatives except possibly a very limited examination of a do not buy option

(Discovering Consumer Problems) Emotion Research

marketers are increasingly conducting research on the role of emotions in problem recognition and resolution common approaches are surveys, focus group research and personal interviews that examine the emotions associate with certain problems critical in helping marketers anticipate consumer reaction to problems and train customer service personnel to respond appropriately

Inactive Problem

one of which the consumer is not aware Marketing Strategy: marketer must convince consumers that they have the problem AND that their brand is a superior solution

Problem Analysis

starts with a problem and asks which activities, products, or brand are associated with (or perhaps could eliminate) those problems look at a specific issue a customer has and see if your product can fix these issues

Purchase Involvement

the level of concern for, or interest in, the purchase process, triggered by the need to consider a particular purchase thus purchase involvement is a temporary state influenced by the interaction of individual, product, and situational characteristics

Problem Recognition

the result of a discrepancy between a desired state and an actual state that is sufficient to arouse and activate the decision process

Actual State

the way an individual perceives his or her feelings and situation to be at the present time

Desired State

the way an individual wants to feel or be at the present time