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Chapter 10 JUDGMENT AND DECISION MAKING: HIGH CONSUMER EFFORT

Chapter 10 JUDGMENT AND DECISION MAKING: HIGH CONSUMER EFFORT. A General Model of Consumer Problem Solving. Problem Recognition. Search for Information. Evaluation of Alternatives. Choice Decision. Purchase. Postpurchase Use and Reevaluation. Chapter Overview. Judgment

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Chapter 10 JUDGMENT AND DECISION MAKING: HIGH CONSUMER EFFORT

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  1. Chapter 10JUDGMENT AND DECISION MAKING: HIGH CONSUMER EFFORT

  2. A General Model of Consumer Problem Solving Problem Recognition Search for Information Evaluation of Alternatives Choice Decision Purchase Postpurchase Use and Reevaluation

  3. Chapter Overview • Judgment • Thought-based (cognitive) decision making • Four types of decision processes • Feeling-based (affective) decision making • Decisions when comparison of alternatives is difficult • How context impacts decisions • Framing

  4. Judgments vs. Decisions Evaluations; actual choice between alternatives not made Judgments Choice between alternatives; based in part on judgments Decisions

  5. Decision-Making Issues • “Rational” decision criteria • decisions well thought out; alternatives compared • cost vs. benefit • Emotional bases • how does each option make you feel? One credit card offers a low interest rate, but another has an extended warranty. The American Express card make me feel successful!

  6. Cognitive Decision Making (High Effort) • Compensatory vs. non-compensatory models • Brand vs. attribute-based processing “I got an F in Calculus. Who cares--I got an A in intro to golf!”

  7. Types of Decision Models Compensatory Noncompensatory Processing by Brand Processing by Attribute Multi-attribute (e.g. TORA) Conjunctive Disjunctive Additive Difference Lexicographic Elimination by aspects

  8. Compensatory/Attribute Processing Models • Additive Difference Models • brands compared by attribute, two at a time • differences added up as decision maker proceeds by attribute; e.g.: Brand A Brand B Difference Attribute 1 3 4 -1 Attribute 2 4 2 2 Attribute 3 6 4 2 ---------------------------------------------------- TOTAL (A vs. B) +3

  9. Noncompensatory Brand Processing Models • Conjunctive models • acceptability cutoffs (minimums) set for each attribute • “AND” rule • Disjunctive model • set high standards for attributes • “OR” rule

  10. Noncompensatory Attribute Processing Models • Lexicographic Model • Attributes ordered by importance • Stop when one choice dominates • Elimination by aspects • Attributes ordered by importance • Stop when only one option remains

  11. ALL ALTERNATIVES SURVIVING ALTERNATIVES Reality of Consumer Decision Making • Consumers may use multiple decision-making strategies

  12. Group Application Exercise: Cognitive Decision Making • Get into groups of 3-5. You will be assigned ONE of the 3 decision making approaches shown below. (1)Noncompensatory/Processing by brand (2)Noncompensatory/Processing by attribute (3)Compensatory/Processing by attribute • Write a scenario showing how your cognitive decision making approach could be applied to deciding what college to attend.

  13. Marketing Implications • Product D • Product P • Cut-off Levels for Product Design • Rank order of Attributes • Encourage Switching between decision models

  14. High-Effort Feeling-Based Decisions • Common for offerings with hedonic, symbolic, or aesthetic attributes • Is frequently combined with cognitive processing

  15. Deciding Between Non-Comparable Alternatives • Alternative-based strategy • overall evaluation of each option • Attribute-based strategy • abstract evaluation of alternatives for each option

  16. Consumer characteristics motivation to process ability to process opportunity to process Task characteristics consideration set availability of info Framing by the consumer external framing Decision-Making Context

  17. Chapter 10 Review • Judgement • Rational Decision Making • Compensatory vs. Noncompensatory • Processing by Brand vs. Processing by Attribute • Affective Decision Making • Deciding When Alternatives Can’t Easily be Compared • Influence of Context on Decision Making

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