Ch10: judgment and decision making low effort

Ch10: judgment and decision making low effort

1. judgment process

   • representative heuristic
     • eg. colgate & listerine, comparing prototype in the same product category, positive associatn
   • availability heauristic
     • ease of recall, vivid memories, emotions tied
     • WOM esp. fr. friends
     • bias judgment
       • tendency to ignore base-rate info.
       • law of small no. - expectn tt info, obtained fr. small pop - generalised/ representative of the large populatn

2. decision-making processes

   • unconscious
     • envr. stimuli eg. fragr. of perfume
       • might trigger choices and behaviour w/o being consciously aware of brand logos, certain placces, social situatn
         • eg. subway
   • conscious
     • traditional hierarchy - thinking-feelings-behaving
       • doesn't apply
     • hierarchy of effects for low-effort situations
       • thinking-behaving-feeling
     • basic awareness of its brand and brand claims
   • linked to motivatn, ability, opportunity (MAO)
     • low cognitive, low effort decisn making
       • eg. grocery shopping
         • made frequently and repeatedly, reliance on previous info. and judgment on satisfactn level frm. past consumptn.
       • choice tactics (simple rules of thumb, quick effortless DM)
         • habit
         • eg. laundry detergents
         • brand-loyalty
           • brand name - heuristic cue
           • brand familiarity
             • eg. beer drinkers w. well-established brand pref. couldn't distinguish their preferred brand fr. others in a blind taste test
           • co-branding
             • combined familiarity - jack daniel''s grill w. TGI friday's
         • variety-seeking
     • optimising
     • satisfice

3. learning choice tactics, simplifying strategy

   • reinforcement
     • feelings + needs have been adequately met
   • punishment
     • negative experience
   • performance
     • attribute
       • eg. starbucks closing 7000 of us stores, brushed up on pdt presentatn, customer-contact skills
     • benefit
       • eg. gillette's venus embrace 5-blade razor vs Schick Quattro 4-blade
   • brand loyalty
     • cognitive lock-in. v. postv. reinforcemt.
       • eg. Heinz ketchup -> more incline to try their new pdts
     • multi-brand loyal
       • eg. purchasing only coke and sprite
     • identify purchase patterns
     • pdt. quality
     • sales promotion
   • price
     • availability of info
       • little motivation to rmb
     • zone of acceptance
     • types of consumers
       • practical loyalists
       • bottom-line price shoppers
       • opportunistic switchers (eg. use coupons/ sales to decide among brands within consideration set)
     • price perceptions
       • comparison w. internal ref. pt.
       • typically a range of prices > 1 single price pt.
       • more responsive to price decrease than increase
       • deal-prone consumers
         • lower-income, older, less educated
       • importance on value
         • high-quality at gd. price
   • normative
     • direct influence
     • vicarious observation
     • indirect influence
   • habit
     • little/ no info. seeking, or evaluation of alternatives
     • shaping through operant conditioning, or build resistance
     • or break habit cycles by inducing brand switch
       • eg. apple - ipod vs discman
       • distribution policies
         • eg. amt. of shelf space
   • feelings
     • affect referral
       • we simply rmb our feelings for the pdt/service
       • eg. Barilla capture 25% of the pasta market in the US
       • positive affect for cooking helped barilla capture 25% of pasta market in US (esp. hedonic offerings - style/taste)
     • impulse buying
       • cultural context
         • asia - interdependence and emo control are emphasised, so less impulse purchasing
         • western - personal indp, hedonistic pleasures more emphasised
       • related to other character traits
         • general acquisitiveness, materialism, sensation seeking, liking for recreational shopping
       • eg. grocery check out - eye-level, eye-catching displays, impulse items like chocolates