Copyright 2001 Houghton Mifflin Company. All rights reserved.Pre-Purchase EvaluationCopyright 2001 Houghton Mifflin Company. All rights reserved.OverviewlHigh effort evaluation processlLow effort evaluation processlContextual effect and decision makingCopyright 2001 Houghton Mifflin Company. All rights reserved.Making ChoicesAll brands in product classUnknown brandsKnown brandsBrands found accidentallyBrands found throughsearchBrandsrecalledfrom memoryUnrecalledbrandsInept set(unacceptable)Inert set(indifference)ConsiderationsetChoiceJUDGMENT AND DECISION MAKINGCopyright 2001 Houghton Mifflin Company. All rights reserved.High Effort Evaluation ProcessCopyright 2001 Houghton Mifflin Company. All rights reserved.Compensatory Brand Processing ModelslMultiattribute Models (or weighted additive rule)Copyright 2001 Houghton Mifflin Company. All rights reserved.Evaluative criteriaEpsonCanonCompaqSamsungIBMToshibaImportancePrice53342130Weight34543425Processor55525510Battery life13141505After-sale support33435310Display quality33353320* evaluations: 1 = very poor; 5 = very good, Evaluations of brands as good or bad based on information retrieved from memory or generated through external search. Importance weights based on needs, values, goals, problem recognitionScore for Samsung Score for Epson30 * 4 = 12030 * 5 = 15025 * 4 = 10025 * 3 = 75 10 * 2 = 2010 * 5 = 5005 * 4 = 2005 * 1 = 0510 * 3 = 3010 * 3 = 3020 * 5 = 10020 * 3 = 60 _ _ 390 370 Copyright 2001 Houghton Mifflin Company. All rights reserved.Compensatory Attribute Processing ModelslAdditive Difference ModellBrands Compared by Attribute, Two at a TimelDifferences Added Up as Decision Maker Proceeds by Attribute; e.g.: EpsonCanon DiffPrice 5 3 2Weight 3 4 -1Processor 5 5 0Battery Life 1 3 -2After Sale Support 3 3 0Display Quality 3 3 0 -TOTAL -1 (Canon is marginally better)Copyright 2001 Houghton Mifflin Company. All rights reserved.Noncompensatory Brand Processing ModelslConjunctive Models (Weight on Negative Info)lMinimum Cutoffs Set for Each Attribute (Reject if Below Cutoff)lNeed Additional Rule to Rule Out Remaining Alternatives (If More Than One)lDisjunctive Model (Weight on Positive Info)lAcceptable Levels for Attributes Decided (Reject if Below Cutoff) lDecision Based on Several, but Not All, Important AttributesCopyright 2001 Houghton Mifflin Company. All rights reserved.Noncompensatory Attribute Processing ModelslLexicographic ModellAttributes ordered by importancelIf one alternative dominates on that attribute, it is chosen; otherwise, proceed to next most important attributelI want to get the brand that does best on the attribute(s) most important to me.lElimination by Aspects (EBA)lAttributes ordered by importance; alternatives acceptable on first attribute proceed to evaluation on further attributeslI will eliminate any brands that have a value of 3 or below, beginning with the most important attribute.Copyright 2001 Houghton Mifflin Company. All rights reserved.Reality of Consumer Decision MakinglConsumers may use multiple decision-making strategieslEmotions and imagery often accompany rational, cognitive analysisALL ALTERNATIVESNON-COMPENSATORYEVALUATIONCOMPENSATORYEVALUATIONSURVIVINGALTERNATIVESCopyright 2001 Houghton Mifflin Company. All rights reserved.Low Effort Evaluation ProcesslConsumers tend to employ very simple heuristics or choice tactics in making decisions when motivation and ability are low, e.g.,ldecision is of limited importancelFew product differences perceivedlDistractions or time constraints Copyright 2001 Houghton Mifflin Company. All rights reserved.DefinitionlHeuristic: A simplified decision rule frequently employed by consumers to make a satisfactory decision of limited importance. In a heuristic, some available information is not processed.Copyright 2001 Houghton Mifflin Company. All rights reserved.Some Common HeuristicslRepresentativeness: Comparison to known alternativeslAvailability: More accessible or vivid impressions are more impactful Copyright 2001 Houghton Mifflin Company. All rights reserved.Choice HeuristicsChoice Heuristics Performance-related tactics Habit tactics Choose the product that you think works best - that provides the best level of performance. Select the one you typically buy as long as it is satisfactory.If choosing among familiar products.Choice HeuristicsChoice Heuristics Variety seeking tactics Normative tactics Price-tactics Choose something different. Live a little! Choose the one others recommend. Buy the least expensive (or the most expensive, depending on your beliefs about relationship between price and quality).If choosing among unfamiliar products.Type of Low-Effort Evaluation Process Copyright 2001 Houghton Mifflin Company. All rights reserved.Brand Loyalty vs. HabitlHabit: consumer picks product without much thought; may be due to conveniencelLoyalty: consumer actively seeks out productCopyright 2001 Houghton Mifflin Company. All rights reserved.Loyalty.lMultibrand loyaltylHow strong?.or the lack of itCopyright 2001 Houghton Mifflin Company. All rights reserved.Variety Seeking and Impulse BuyinglImpulse BuyinglUnplanned, spur-of-the-moment action triggered by in-store display or promotionlVariety SeekinglBrand shifts because bored with current brand or because of special offerlconsumers may still satisfied with their existing brands Copyright 2001 Houghton Mifflin Company. All rights reserved.Contextual Effect and Decision MakinglDecision-making context may influence the decision/evaluation processlContext factors include:ltask characteristicsldecision framing Copyright 2001 Houghton Mifflin Company. All rights reserved.How Task Characteristics Can Affect Decision MakinglThe Consideration SetlAttraction EffectlExtremeness AversionlAvailability of InformationlInformation OverloadCopyright 2001 Houghton Mifflin Company. All rights reserved.How Decision Framing Can Affect Decision MakingConsider the following two choice conditions:lCondition 1:lcoupon A: buy a jar of spaghetti sauce for $1.89 and get a can of soup FREE (a 49-cent value)lcoupon B: receive a 25 cents off a large jar of spaghetti sauceCopyright 2001 Houghton Mifflin Company. All rights reserved.How Decision Framing Can Affect Decision MakinglCondition 2:lcoupon A: buy a jar of spaghetti sauce and get a can of soup and get 49 cent off the totallcoupon B: receive a 25 cents off a large jar of spaghetti sauce