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BABSONCOLLEGE

NoteonConsumerDecisionMakingProcesses

ByKenMatsuno

ConsumersAsProblemSolvers

Traditionally,consumerresearchershaveapproacheddecisionmakingprocessfromarationalperspective.Thisdominantschoolofthoughtviewsconsumersasbeingcognitive(i.e.,problem-solving)and,tosomebutalesserdegree,emotional」Suchaviewisreflectedinthestagemodelofatypicalbuyingprocess(oftencalledtheconsumerinformationprocessingmodel)depictedinFigure1.

Figure1TheConsumerInformationProcessingModel

Source:AdoptedfromKotler(1997),SchiffmanandKanuk(1997),andSolomon(1996)

Inthismodel,theconsumerpassesthroughfivestages:problemrecognition,informationsearch,evaluationandselectionofalternatives,decisionimplementation,andpostpurchaseevaluation.

ProblemRecognition

Inthisinformationprocessingmodel,theconsumerbuyingprocessbeginswhenthebuyerrecognizesaproblemorneed.Forexample,Dougmayrealizethathisbestsuitdoesn’tlookcontemporaryanymore.Or,Kathleenmayrecognizethatherpersonalcomputerisnotperformingaswellasshethoughtitshould.Thesearethekindsof

ThisnoteispreparedbyKenMatsuno,AssistantProfessorofMarketingasabasisforclassdiscussion.

Copyright©byKenMatsunoandBabsonCollege,1997

problemthatweasconsumersencounterallthetime.Whenwefoundoutadifferencebetweentheactualstateandadesiredstate,aproblemisrecognized.Whenwefindaproblem,weusuallytrytosolvetheproblem.We,inotherwords,recognizetheneedtosolvetheproblem.Buthow?

InformationSearch

Whenaconsumerdiscoversaproblem,he/sheislikelytosearchformoreinformation.Kathleenmaysimplypaymoreattentiontoproductinformationofapersonalcomputer.Shebecomesmoreattentivetocomputerads,computerspurchasedbyherfriends,andpeerconversationsaboutcomputers.Or,shemaymoreactivelyseekinformationbyvisitingstores,talkingtofriends,orreadingcomputermagazines,amongothers.Throughgatheringinformation,theconsumerlearnsmoreaboutsomebrandsthatcompeteinthemarketandtheirfeaturesandcharacteristics.Theoretically,thereisatotalsetofbrandsavailabletoKathleen,butshewillbecomeawareofonlyasubsetofthebrands(awarenessset)inthemarket.Someofthesebrandsmaysatisfyherinitialbuyingcriteria,suchaspriceandprocessingspeed(considerationset).AsKathleenproceedstomoreinformationsearch,onlyafewwillremainasstrongcandidates(choiceset).

EvaluationandSelectionofA^lte^na^ives

Howdoestheconsumerprocesscompetitivebrandinformationandevaluatethevalueofthebrands?Unfortunatelythereisnosingle,simpleevaluationprocessappliedbyallconsumersorbyoneconsumerinallbuyingsituations.

Onedominantview,however,istoseetheevaluationprocessasbeingcognitivelydrivenandrational.Underthisview,aconsumeristryingtosolvetheproblemandultimatelysatisfyinghis/herneed.Inotherwords,he/shewilllookforproblem-solvingbenefitsfromtheproduct.Theconsumer,then,looksforproductswithacertainsetofattributesthatdeliverthebenefits.Thus,theconsumerseeseachproductasabundleofattributeswithdifferentlevelsofabilityofdeliveringtheproblemsolvingbenefitstosatisfyhis/herneed.Thedistinctionsamongtheneed,benefits,andattributesareveryimportant.Oneusefulwaytoorganizetherelationshipsamongthethreeisahierarchicalone(Figure2).Althoughsimplified,Figure2isanexampleofhowabundleofattributes(i.e.,aproductor,morespecifically,personalcomputer)relatestothebenefitsandunderlyingneedsofKathleen.

Figure2HierarchicalViewofNeeds,Benefits,andAttributes

Fromthisfigureandtheprecedingdiscussion,youmightrecognizethattheproductattributesarerelevantandimportantonlytotheextentthattheyleadtoacertainsetofbenefits.Likewise,benefitsaremeaningfulonlyiftheycanaddresstheproblemandbeinstrumentaltosatisfytheunderlyingneed.Astheunderlyingneedisoftenpersonal,consumersdifferastotheirbeliefsaboutwhatproductbenefitsandattributesaremore(orless)importantandrelevantinsatisfyingtheirneeds.Basedontheirpersonaljudgmentonimportanceofbenefitsandattributes,consumersdevelopasetofattitudes(orpreferences)towardthevariousbrands.Onemayexpresshis/herpreferencesofthebrandsintermsofranking,probabilityofchoice,andsoforth.

DecisionImplementation

Toactuallyimplementthepurchasedecision,however,aconsumerneedstoselectbothspecificitems(brands)andspecificoutlets(wheretobuy)toresolvetheproblems.Thereare,infact,threewaysthesedecisionscanbemade:1)simultaneously;2)itemfirst,outletsecond;or3)outletfirst,itemsecond.2Inmanysituations,consumersengageinasimultaneousselectionprocessofstores3andbrands.Forexample,inourKathleen’spersonalcomputercase,shemayselectasetofbrandsbasedonboththeproducfstechnicalfeatures(attributes)andavailabilityofbrandsinthecomputerstoresandmailordercatalogssheknowswell.Itisalsopossible,thatshedecideswheretobuy(e.g.,CompUSAinherneighborhood)andthenchoosesoneortwobrandsthestorecarries.Oncethebrandandoutlethavebeendecided,theconsumermovesontothetransaction(“buying”).

Post-purchaseEvaluation

Post-purchaseevaluationprocessesaredirectlyinfluencedbythetypeofprecedingdecision-makingprocess.Directlyrelevanthereisthelevelofpurchaseinvolvementoftheconsumer.Purchaseinvolvementisoftenreferredtoas“thelevelofconcernfororinterestinthepurchase"4situation,anditdetermineshowextensivelytheconsumersearchesinformationinmakingapurchasedecision.5Althoughpurchaseinvolvementisviewedasacontinuum(fromlowtohigh),itisusefultoconsidertwoextremecaseshere.Supposeonebuysacertainbrandofproduct(e.g.,DietPepsi)asamatterofhabit(habitualpurchase).Forhim/her,buyingacoladrinkisaverylowpurchaseinvolvementsituation,andhe/sheisnotlikelytosearchandevaluateproductinformationextensively.Insuchacase,theconsumerwouldsimplypurchase,consumeand/ordisposeoftheproductwithverylimitedpost-purchaseevaluation,andgenerallymaintainahighlevelofrepeatpurchasemotivation(Figure3).

Figure3 LowInvolvementPurchase

Source:Hawkins,Best,andConey(1983)

However,ifthepurchaseinvolvementishighandtheconsumerisinvolvedinextensivepurchasedecisionmaking(e.g.,personalcomputer),he/sheismorelikelytobeinvolvedinmoreelaboratepost-purchaseevaluation—oftenbyquestioningtherightnessofthedecision:“DidImaketherightchoice?ShouldIhavegonewithotherbrand?"Thisisacommonreactionaftermakingadifficult,complex,relativelypermanentdecision.Thistypeofdoubtandanxietyisreferredtoaspost-purchasecognitivedissonance(Figure4).

Figure4ElaboratePost-purchaseEvaluation

Source:AdoptedfromHawkins,Best,andConey(1983)

Accordingtotheresearch,thelikelihoodofexperiencingthiskindofdissonanceandthemagnitudeofitisafunctionof:6

Thedegreeofcommitmentorirrevocabilityofthedecision,

Theimportanceofthedecisiontotheconsumer,

Thedifficultyofchoosingamongthealternatives,and

Theindividual'stendencytoexperienceanxiety.

Becausedissonanceisuncomfortable,theconsumermayuseoneormoreofthefollowingapproachestoreduceit:7

Increasethedesirabilityofthebrandpurchased.

Decreasethedesirabilityofrejectedalternatives.

Decreasetheimportanceofthepurchasedecision.

Rejectthenegativedataonthebrandpurchased.

Ifthedissonanceaboutthepurchaseisnotreduced,theanxietymaytransformintoadissatisfaction(generalorspecific).Certainly,thisnegativeexperienceleadstoanewproblemrecognition(Figure1),andtheconsumerwillengageinanotherproblemsolvingprocess.Thedifference,however,isthatinthenextroundofprocess,memoryofthepreviousnegativeexperienceanddissatisfactionwillbeusedaspartofinformation.Therefore,theprobabilityfortheunsatisfactorybrandtobere-selectedandrepurchasedwillbesignificantlylowerthanbefore.

TheHierarchyofEffects

Anotherwidely-usedmodelinmarketingthatattemptstoexplainconsumerdecisionmakingprocessiscalledthehierarchyofeffectsmoAehoughdifferentresearchersdevelopedslightlydifferentmodels,thebasicideaisthesame:peopleexperienceasequenceofpsychologicalstagesbeforepurchasingaproduct.SuchamodelisprovidedinFigure5.8

Figure5AGeneralModeloftheHierarchyofEffects

Source:AdoptedfromDelozier(1976)

Originallyconceivedtoexplainhowadvertisingaffectsconsumer’spurchasedecisions,thehierarchyofeffects(HOE)modelfocusesonconsumerlearningthattakesplaceashe/sheprocessesinformationfromtheexternalworld.TheHOEmodelbeginswiththestatewhereaconsumerhasnoawarenessaboutthebrand(unaware)thendevelopsawarenesstriggeredbyexternalstimuli,suchasadvertisingmessageor“wordofmouth.”Ashe/sheobtainsandprocessesmoreinformation,theconsumerdevelopsmorespecificknowledgeaboutthebrand.Theknowledge,then,isusedasbasistoformaliking(ordisliking),leadingtoapreferenceofbrand(s)relativetotheothers.However,peopleneedtobepushedbeyondthepreferencestagetoactuallybuythebrandofpreference.Thepreferencestage,afterall,simplymeansthattheconsumerhasformedapreferencepsychologically.Nowittakesconvictionforhim/herbeforeactuallybuyingthebrand.

Bynow,youmighthaverealizedatleasttwopoints.One,itseemsreasonablethatnotalltheconsumersareatthesamestage.Forexample,SusanmaybeintheunawarenessstagerelativetoSamuelAdamsbeer,butMelissamaybeinthepreferencestage.Two,italsoseemsreasonablethatnotallpeopleatonestagemoveontothenextstage.Forexample,someconsumerswhohaveformedpreferencetoContadinapastamaynotformanyconvictiontobuytheproduct.Furthermore,somepeoplemayneedmoretimebeforemovingontothenextstagethanothers.

TheHOEmodelisquitesimilartotheconsumerinformationprocessingmodelbecauseitalsoassumesthatpeoplearecognitivelydriven,thinkinginformationprocessors.Controversyexists,9ofcourse,astowhetherthatisnecessarilytrue.Somemayclaimthattheyoftenformlikingandpreference(emotionalresponseorfeeling)towardbrandsbeforedevelopingcognitivejudgment(knowledgeorthinking)onthem.Othersarguethatpeopleformpreferenceandknowledgesimultaneously.Althougheachargumenthasitsownsupport,thegeneralmodel(cognitionfirst,preferencesecond)seemstobevalidespeciallyinrelativelycomplex—orhigh-involvement—decisionmakingsituations(e.g.,cars,computers),providingaconceptualframeworkforthinkingaboutthesequenceofeventswhichbeginsfromtheinitialawarenesstothefinalaction(i.e.,purchasing).

Now,sowhat?

Wehavereviewedtwoofthemostwidelyacceptedmodelsofconsumerdecisionmakingprocess.Thesearebasedontheoriesandresearchofsocialpsychology,consumerbehavior,andmarketing.Asmanagersratherthanacademics,however,wehaveseveralmoretoughquestionstoask.Herearesomeofthem:

Theideaoftheinformationprocessingmodelseemsreasonable.But,weknowthatweasindividualsarenotlivinginavacuum.Thatis,whenwearemakingapurchasedecision,weareconstantlyinfluencedbyotherfactorsthanjustinformation,suchasfamily,friends,culturalvalues,socialclass,orsubculture.Oh,whataboutphysiologicalneeds,suchassex,hunger,safety?Mightthesealsoaffectwhichbrandwechooseandbuy?Howandwheredothesefactorsplayrolesintheinformationprocessingmodel?

Whatwouldbesomeofthepracticalimplicationsoftheinformationprocessingmodelforamarketingmanagerwhoistryingtomarket,say,mountainbikes?Ifhe/sheknowsabouttheinformationprocessingmodel,whatcouldhe/shedodifferentlyin,forexample,thenewproductintroduction?

WhatwouldbetheimplicationsoftheHOEmodelformarketingmanagers?Forexample,whatshouldanadvertisingmanagermeasuretoknowthe"effectiveness”ofhis/heradvertisingcampaign?Shouldhe/shemeasure"sales”?

Underwhatcircumstancesconsumersaremorelikelytodevelop"liking(feeling)”first,“knowing(thinking)”second?Whatwouldbesomeoftheproducts/servicesinthosesituations?Why?

NOTES

SeealsoSchiffman,LeonG.andLeslieLazarKanuk(1997),ConsumerBehavior,UpperSaddleRiver,NewJersey:PrenticeHall.andSolomon,MichaelR,(1996),ConsumerBehavior:Buying,Having,andBeing,EnglewoodCliffs,NewJersey:PrenticeHall.Formoredetaileddiscussionsandpapercitations,refertoEngel,JamesF.,RogerD.Blackwell,andPaulW.Minard(1993),ConsumerBehavior,7thed.,FortWorth,Texas:DrydenPress.andWilkie,WilliamL,(1990),ConsumerBehavior,2nded.,NewYork,NewYork:JohnWiley&Sons.

Hawkins,DelI.,R.J.Best,andK.A.Coney(1983),ConsumerBehavior:ImplicationsforMarketingStrategy,Plano,Texas:BusinessPublicationsInc.

Consumersmayalsoconsidernon-storeshopping(internetwebpages,catalogues,CUCInternational,etc.).

Hawkins,DelI.,R.J.Best,andK.A.Coney(1983),ConsumerBehavior:ImplicationsforMarketingStrategy,Plano,Texas:BusinessPublicationsInc.

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