Simplifying Decision Making: Low Consumer Effort Strategies
E N D
Presentation Transcript
Chapter 9 Judgment & Decision Making Based on Low Consumer Effort
Learning Objectives~ Ch. 9 To understand: • Heuristics & simple judgment • Conscious & unconscious decisions • Hierarchy of effects, decision heuristics, & operant conditioning • Thought-based strategies of performance tactics, habit, brand loyalty, price-related tactics, & normative influences • Feeling-based strategies of affective tactics, variety seeking, & impulse purchasing
Shortcuts in Making Low-Effort Judgments A heuristic is a “rule of thumb” to simplify things A. Representativeness Heuristic: Comparing a stimulus with the category prototype/exemplar B. Availability Heuristics: Basing judgments on events that are easier to recall Base-Rate Information Law of Small Numbers
Unconscious Low-Effort Decision Making • You may make a decision without being consciously aware of how or why you are doing so. Example? • Use of all senses • Environmental stimuli • Automatic goal-relevant behavior
Conscious Low-Effort Decision Making • Low-Effort vs. High-Effort Decision Making • Hierarchy of Effects • Thinking > Feeling > Behaving • Passive/Incidental Learning • Post-Purchase • Thinking > Behaving > Feeling • Simplifying Strategies • Optimizing • Satisfice
How Consumers Learn to Apply Choice Tactics • Choice tactic: simple rule of thumb consumers use to make low-effort decisions • Consumers may learn choice tactics via: Operant Conditioning:behavior is ƒ(previous actions & reinforcements or punishments obtained from these actions) • Reinforcement • Punishment • Repeat Purchase • Choice = Product Dependent
Simplifying Strategies in Low Elaboration Contexts Recall, in low effort contexts (e.g., beverage) consumers apply different choice tactics than in high effort contexts (e.g., new car) Simplifying Strategies: When MAO is low, consumers are motivated to simplify the cognitive process with heuristics How a message is framed influences how consumers react
Choice Tactics • 1. Performance-related • 2. Habit • 3. Brand Loyalty • 4. Price • 5. Normative influences • 6. Feelings/affect • 7. Variety Seeking (note, you may recognize these in the left box of the consumer-learning process figure shown prior)
1. Performance as a Simplifying Strategy Performance-Related Tactics: when the outcome of the consumption process is positive reinforcement Can be an overall evaluation of performance, or focused on a specific attribute or benefit Quality Important features/benefits Sales promotions
2. Habitas a Simplifying Strategy Having a habit (e.g., in the grocery store) is a simplifying strategy Habits can make life simpler & or more manageable Habit—Repeat Purchase, Shaping Little/no information sought Little/no evaluation of alternatives Promotion/distribution policies
3. Brand Loyalty as a Simplifying Strategy Brand/Multibrand Loyalty Purchase pattern + commitment to brand Cognitive lock-in Resistant to competitive efforts Quality/Satisfaction
4. Price as a Simplifying Strategy • Consumer Side • Price Considerations: • -Zone of Acceptance • -Price Perceptions • -Deal-Prone Consumers • -Price consciousness is not static Marketer Side Price Considerations: -Coupons -Price-offs -Rebates -Two-for-ones -Savings must be: at or above the just noticeable difference & within zone of acceptance -Special pricing must not be used too often or risk of dilution
5. Normative Influencesas a Simplifying Strategy Others can influence consumers’ low-elaboration decision making Normative Influences Direct Vicarious Indirect
6. Feelings/Affectas a Simplifying Strategy Affect: low level feelings Think of a brand you just like, & you don’t really know why. Affect does not necessarily result from a conscious recognition of need satisfaction Affect is weaker than attitude Affect referral: the “how do I feel about it heuristic” Affect is often generated from brand familiarity The mere exposure effect Visual Attributes Co-Branding
7. Decision Making Based on Variety-Seeking Needs Variety-Seeking Needs (e.g., in soft drinks) Satiation/Boredom Optimal Stimulation/Sensation Seekers Vicarious Exploration Buying on Impulse/Impulse Purchases Intense feeling Disregard negative consequences Euphoria/Excitement Conflict between control vs. Indulgence What impacted your last impulse purchase?
Under low-effort decision making, consumers often use performance tactics to choose a brand. This ad demonstrates that Tostitos Salsa Con Queso contains real cheese. The important feature of the brand is emphasized in the ad & packaging. Courtesy Frito-Lay, Inc.
