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Chapter 14 
Consumer Decision Making I: 
The Process 
Consumer Behaviour 
Canadian Edition 
Schiffman/Kanuk/Das 
Copyright © 2006 
Pearson Education Canada Inc.
Levels of Consumer Decision 
Copyright © 2006 Pearson 
Education Canada Inc. 
14-2 
Making 
Extensive Problem 
Solving 
Limited Problem 
Solving 
Routine Response 
Behaviour
Factors That Affect the Type of 
Decision Making Process Used 
 Importance of the decision 
 Extent of previous experience 
 Existence of well-established decision 
criteria 
 Amount of information at hand about each 
alternative 
 The number of alternatives available 
 Model of consumption being followed 
Copyright © 2006 Pearson 
Education Canada Inc. 
14-3
Copyright © 2006 Pearson 
Education Canada Inc. 
14-4
Consumer Decision Making – The 
Copyright © 2006 Pearson 
Education Canada Inc. 
14-5 
Process 
 Need Recognition 
 Pre-purchase Search 
 Evaluation of Alternatives
Need or Problem Recognition 
 The realization that there is a difference 
between actual and desired states 
– The higher the gap, the stronger the need (or 
Copyright © 2006 Pearson 
Education Canada Inc. 
14-6 
bigger the problem)
Types of Problems 
 Active Versus Inactive problems 
– Active: those you are aware of 
– Inactive: those that you are not yet aware of 
Copyright © 2006 Pearson 
Education Canada Inc. 
14-7 
(but exist) 
 Those that require immediate solutions and 
those that do not require immediate 
solutions
Problem Recognition and 
Marketing Strategy 
 Identify existing consumer problems and find 
solutions for these 
 Lower the actual state 
 Increase the desired state 
 Increase the importance of the gap between actual 
and desired states 
 Convert inactive problems to active problems 
 Convert problems into ones requiring an 
immediate solution 
Copyright © 2006 Pearson 
Education Canada Inc. 
14-8
Pre-Purchase Search 
 Types of Information Sources 
 Types of Information Sought 
 Factors Affecting Extent of Information 
Search 
Copyright © 2006 Pearson 
Education Canada Inc. 
14-9
Figure 14-3: Types of 
Information Sources 
Copyright © 2006 Pearson 
Education Canada Inc. 
14-10 
PPEERRSSOONNAALL 
Friends 
Neighbors 
Relatives 
Co-workers 
Computer salespeople 
Calling the electronics 
store 
IIMMPPEERRSSOONNAALL 
Newspaper articles 
Magazine articles 
Consumer Reports 
Direct-mail brochures 
Information from product 
advertisements 
Internal web site
Types of Information Sought 
 Brands or alternatives available 
 Evaluative criteria to be used 
– Generally, product features 
 Ratings of brands on evaluative criteria 
Copyright © 2006 Pearson 
Education Canada Inc. 
14-11
Copyright © 2006 Pearson 
Education Canada Inc. 
14-12
Factors that Increase the Level of 
Pre-purchase Search 
 Product Factors: Higher search when 
– It is a long-lasting or infrequently used 
product 
– There are frequent changes in product styling 
– Large volume is purchased 
– The price is high 
– There are many alternative brands 
– There is much variation in features 
Copyright © 2006 Pearson 
Education Canada Inc. 
14-13 
» continued
Factors that Increase the Level of 
Pre-purchase Search 
 Situational Factors: Higher search when: 
– Experience is lower 
– Previous experience was unsatisfactory 
 Social Acceptability: Higher search when: 
– Purchase is a gift 
– Product is socially visible in use 
Copyright © 2006 Pearson 
Education Canada Inc. 
14-14 
» continued
Factors that Increase the Level of 
Pre-purchase Search 
 Value-Related Factors: Higher search 
when: 
– Purchase is discretionary 
– All alternatives have both positive and 
negative qualities 
– No agreement among users exists 
– Conflicting information is available 
– Other considerations exist 
Copyright © 2006 Pearson 
Education Canada Inc. 
14-15 
» continued
Factors that Increase the Level of 
Pre-purchase Search 
 Consumer Factors: Higher search when: 
– Consumers are well-educated, have higher 
income levels and are younger 
– Consumers are low in dogmatism and risk 
perception 
– Level of involvement is high 
– Shopping is seen as an enjoyable activity 
Copyright © 2006 Pearson 
Education Canada Inc. 
14-16 
» continued
Evaluation of Alternatives – Types 
of Consumer Choice Processes 
 Affective choices 
– More holistic; an overall evaluation 
– based on how one feels about a purchase 
 Attribute-based choices 
– Have pre-determined evaluative criteria 
– May require both external and internal search 
– Complicated decision rules may be used 
Copyright © 2006 Pearson 
Education Canada Inc. 
14-17
Nature of Evaluative Criteria 
 Can be tangible or intangible 
 Include surrogate indicators 
– Attributes that are used as indicators of another 
Copyright © 2006 Pearson 
Education Canada Inc. 
14-18 
attribute 
 Are often ranked in order of importance
Consumer Decision Rules 
 Procedures used by consumers to facilitate 
brand or other consumption-related choices 
Copyright © 2006 Pearson 
Education Canada Inc. 
14-19
Consumer Decision Rules 
 Compensatory 
– Brands evaluated in terms of each relevant 
criteria and the best brand (or one with the 
highest score) is chosen 
 Non-compensatory 
– Positive evaluations do not compensate for 
Copyright © 2006 Pearson 
Education Canada Inc. 
14-20 
negative evaluations
Non-Compensatory Consumer 
Decision Rules 
 CCoonnjjuunnccttiivvee DDeecciissiioonn RRuullee 
– Product attributes are identified 
– a minimally acceptable cutoff point is 
established for each attribute 
– brands that fall below the cutoff point on 
any one attribute are eliminated from 
further consideration. 
Copyright © 2006 Pearson 
Education Canada Inc. 
14-21 
» continued
Non-Compensatory Consumer 
Decision Rules 
 DDiissjjuunnccttiivvee DDeecciissiioonn RRuullee 
– consumers identify product attributes 
– establish a minimally acceptable cutoff 
point for each attribute 
– accept the brand that meets or exceeds 
the cutoff for any one attribute 
Copyright © 2006 Pearson 
Education Canada Inc. 
14-22 
» continued
Non-Compensatory Consumer 
Copyright © 2006 Pearson 
Education Canada Inc. 
14-23 
Decision Rules 
 Lexicographic Decision Rule 
– Product attributes are identified 
– Product attributes are ranked in terms of 
importance 
– brands are compared in terms of the attribute 
considered most important 
– Brand that scores highest on the first attribute is 
chosen 
– If there is a tie, the scores on the next attribute 
are considered
Copyright © 2006 Pearson 
Education Canada Inc. 
14-24
Issues in Alternative Evaluation 
 Lifestyles as a Consumer Decision Strategy 
 Incomplete Information 
 Non-comparable Alternatives 
 Series of Decisions 
 Consumption Vision 
– Mental picture of the consequences of using a 
Copyright © 2006 Pearson 
Education Canada Inc. 
14-25 
particular product
Coping with Missing Information 
 Delay decision until missing information is 
obtained 
 Ignore missing information and use 
available information 
 Change the decision strategy to one that 
better accommodates for the missing 
information 
 Infer the missing information 
Copyright © 2006 Pearson 
Education Canada Inc. 
14-26
Information Search and 
Marketing Strategy 
 Get products into consumers’ evoked set 
 Limit information search if your brand is 
the preferred brand 
 Increase information search if your 
alternative is not the preferred brand 
 Use point-of-purchase advertising 
effectively 
Copyright © 2006 Pearson 
Education Canada Inc. 
14-27
Alternative Evaluation and 
Marketing Strategy 
 Identify decision rule used by target market and 
use suitable promotional messages 
 Influence the choice of evaluative criteria 
 Influence the rating of your product on evaluative 
criteria used 
 Use surrogate indicators effectively 
 Use ‘consumption vision’ 
Copyright © 2006 Pearson 
Education Canada Inc. 
14-28

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Schiff ch14

  • 1. Chapter 14 Consumer Decision Making I: The Process Consumer Behaviour Canadian Edition Schiffman/Kanuk/Das Copyright © 2006 Pearson Education Canada Inc.
  • 2. Levels of Consumer Decision Copyright © 2006 Pearson Education Canada Inc. 14-2 Making Extensive Problem Solving Limited Problem Solving Routine Response Behaviour
  • 3. Factors That Affect the Type of Decision Making Process Used  Importance of the decision  Extent of previous experience  Existence of well-established decision criteria  Amount of information at hand about each alternative  The number of alternatives available  Model of consumption being followed Copyright © 2006 Pearson Education Canada Inc. 14-3
  • 4. Copyright © 2006 Pearson Education Canada Inc. 14-4
  • 5. Consumer Decision Making – The Copyright © 2006 Pearson Education Canada Inc. 14-5 Process  Need Recognition  Pre-purchase Search  Evaluation of Alternatives
  • 6. Need or Problem Recognition  The realization that there is a difference between actual and desired states – The higher the gap, the stronger the need (or Copyright © 2006 Pearson Education Canada Inc. 14-6 bigger the problem)
  • 7. Types of Problems  Active Versus Inactive problems – Active: those you are aware of – Inactive: those that you are not yet aware of Copyright © 2006 Pearson Education Canada Inc. 14-7 (but exist)  Those that require immediate solutions and those that do not require immediate solutions
  • 8. Problem Recognition and Marketing Strategy  Identify existing consumer problems and find solutions for these  Lower the actual state  Increase the desired state  Increase the importance of the gap between actual and desired states  Convert inactive problems to active problems  Convert problems into ones requiring an immediate solution Copyright © 2006 Pearson Education Canada Inc. 14-8
  • 9. Pre-Purchase Search  Types of Information Sources  Types of Information Sought  Factors Affecting Extent of Information Search Copyright © 2006 Pearson Education Canada Inc. 14-9
  • 10. Figure 14-3: Types of Information Sources Copyright © 2006 Pearson Education Canada Inc. 14-10 PPEERRSSOONNAALL Friends Neighbors Relatives Co-workers Computer salespeople Calling the electronics store IIMMPPEERRSSOONNAALL Newspaper articles Magazine articles Consumer Reports Direct-mail brochures Information from product advertisements Internal web site
  • 11. Types of Information Sought  Brands or alternatives available  Evaluative criteria to be used – Generally, product features  Ratings of brands on evaluative criteria Copyright © 2006 Pearson Education Canada Inc. 14-11
  • 12. Copyright © 2006 Pearson Education Canada Inc. 14-12
  • 13. Factors that Increase the Level of Pre-purchase Search  Product Factors: Higher search when – It is a long-lasting or infrequently used product – There are frequent changes in product styling – Large volume is purchased – The price is high – There are many alternative brands – There is much variation in features Copyright © 2006 Pearson Education Canada Inc. 14-13 » continued
  • 14. Factors that Increase the Level of Pre-purchase Search  Situational Factors: Higher search when: – Experience is lower – Previous experience was unsatisfactory  Social Acceptability: Higher search when: – Purchase is a gift – Product is socially visible in use Copyright © 2006 Pearson Education Canada Inc. 14-14 » continued
  • 15. Factors that Increase the Level of Pre-purchase Search  Value-Related Factors: Higher search when: – Purchase is discretionary – All alternatives have both positive and negative qualities – No agreement among users exists – Conflicting information is available – Other considerations exist Copyright © 2006 Pearson Education Canada Inc. 14-15 » continued
  • 16. Factors that Increase the Level of Pre-purchase Search  Consumer Factors: Higher search when: – Consumers are well-educated, have higher income levels and are younger – Consumers are low in dogmatism and risk perception – Level of involvement is high – Shopping is seen as an enjoyable activity Copyright © 2006 Pearson Education Canada Inc. 14-16 » continued
  • 17. Evaluation of Alternatives – Types of Consumer Choice Processes  Affective choices – More holistic; an overall evaluation – based on how one feels about a purchase  Attribute-based choices – Have pre-determined evaluative criteria – May require both external and internal search – Complicated decision rules may be used Copyright © 2006 Pearson Education Canada Inc. 14-17
  • 18. Nature of Evaluative Criteria  Can be tangible or intangible  Include surrogate indicators – Attributes that are used as indicators of another Copyright © 2006 Pearson Education Canada Inc. 14-18 attribute  Are often ranked in order of importance
  • 19. Consumer Decision Rules  Procedures used by consumers to facilitate brand or other consumption-related choices Copyright © 2006 Pearson Education Canada Inc. 14-19
  • 20. Consumer Decision Rules  Compensatory – Brands evaluated in terms of each relevant criteria and the best brand (or one with the highest score) is chosen  Non-compensatory – Positive evaluations do not compensate for Copyright © 2006 Pearson Education Canada Inc. 14-20 negative evaluations
  • 21. Non-Compensatory Consumer Decision Rules  CCoonnjjuunnccttiivvee DDeecciissiioonn RRuullee – Product attributes are identified – a minimally acceptable cutoff point is established for each attribute – brands that fall below the cutoff point on any one attribute are eliminated from further consideration. Copyright © 2006 Pearson Education Canada Inc. 14-21 » continued
  • 22. Non-Compensatory Consumer Decision Rules  DDiissjjuunnccttiivvee DDeecciissiioonn RRuullee – consumers identify product attributes – establish a minimally acceptable cutoff point for each attribute – accept the brand that meets or exceeds the cutoff for any one attribute Copyright © 2006 Pearson Education Canada Inc. 14-22 » continued
  • 23. Non-Compensatory Consumer Copyright © 2006 Pearson Education Canada Inc. 14-23 Decision Rules  Lexicographic Decision Rule – Product attributes are identified – Product attributes are ranked in terms of importance – brands are compared in terms of the attribute considered most important – Brand that scores highest on the first attribute is chosen – If there is a tie, the scores on the next attribute are considered
  • 24. Copyright © 2006 Pearson Education Canada Inc. 14-24
  • 25. Issues in Alternative Evaluation  Lifestyles as a Consumer Decision Strategy  Incomplete Information  Non-comparable Alternatives  Series of Decisions  Consumption Vision – Mental picture of the consequences of using a Copyright © 2006 Pearson Education Canada Inc. 14-25 particular product
  • 26. Coping with Missing Information  Delay decision until missing information is obtained  Ignore missing information and use available information  Change the decision strategy to one that better accommodates for the missing information  Infer the missing information Copyright © 2006 Pearson Education Canada Inc. 14-26
  • 27. Information Search and Marketing Strategy  Get products into consumers’ evoked set  Limit information search if your brand is the preferred brand  Increase information search if your alternative is not the preferred brand  Use point-of-purchase advertising effectively Copyright © 2006 Pearson Education Canada Inc. 14-27
  • 28. Alternative Evaluation and Marketing Strategy  Identify decision rule used by target market and use suitable promotional messages  Influence the choice of evaluative criteria  Influence the rating of your product on evaluative criteria used  Use surrogate indicators effectively  Use ‘consumption vision’ Copyright © 2006 Pearson Education Canada Inc. 14-28