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.c om Chapter ng th an co ng Individual Decision Making cu u du o CONSUMER BEHAVIOR, 8e Michael Solomon CuuDuongThanCong.com https://fb.com/tailieudientucntt Chapter Objectives c om When you finish this chapter you should understand why: ng • Consumer decision making is a central part of du o ng th an co consumer behavior, but the way we evaluate and choose products (and the amount of thought we put into these choices) varies widely, depending upon such dimensions as the degree of novelty or risk in the decision • A decision is actually composed of a series of cu u stages that results in the selection of one product over competing options • Our access to online sources is changing the way we decide what to buy Hoang Duc Binh, 2008 CuuDuongThanCong.com https://fb.com/tailieudientucntt Chapter Objectives (cont.) ng c om • Decision making is not always rational • Consumers rely upon different decision rules when co evaluating competing options th cu u du o ng to make decisions an • We often fall back on well learned “rules-of-thumb” Hoang Duc Binh, 2008 CuuDuongThanCong.com https://fb.com/tailieudientucntt Consumers as Problem Solvers c om • Consumer purchase = response to problem • After realization that we want to make a an th • • co ng purchase, we go through a series of steps in order to make it Can seem automatic or like a full-time job Complicated by consumer hyperchoice cu u du o ng • Decision-making process Click photo to view Quicktime video on General Electric and consumer shopping Hoang Duc Binh, 2008 CuuDuongThanCong.com https://fb.com/tailieudientucntt cu u du o ng th an co ng c om Decision-Making Process Hoang Duc Binh, 2008 Figure 9.1 CuuDuongThanCong.com https://fb.com/tailieudientucntt Decision-Making Perspectives c om • Rational perspective: consumers: • Integrate as much information as possible with cu u du o ng th an co ng what they already know about a product • Weigh pluses and minuses of each alternative • Arrive at a satisfactory decision Hoang Duc Binh, 2008 CuuDuongThanCong.com https://fb.com/tailieudientucntt Decision-Making Perspectives (cont.) c om • Other models of decision making: • Purchase momentum: occurs when consumers cu u du o ng th an co ng buy beyond needs satisfaction • Behavioral influence perspective: consumers buy based on environmental cues, such as a sale • Experiential perspective: consumers buy based on totality of product’s appeal Hoang Duc Binh, 2008 CuuDuongThanCong.com https://fb.com/tailieudientucntt cu u du o ng th an co ng c om Continuum of Buying Decision Behavior Hoang Duc Binh, 2008 Figure 9.2 CuuDuongThanCong.com https://fb.com/tailieudientucntt Types of Consumer Decisions co ng c om • Extended problem solving: • Initiated by a motive that is central to self-concept • Consumer feels that eventual decision carries a fair degree of risk ng th an • Limited problem solving: • Buyers not as motivated to search for information du o u • or to evaluate rigorously Buyers use simple decision rules to choose cu • Habitual decision making: • Choices made with little to no conscious effort Hoang Duc Binh, 2008 CuuDuongThanCong.com https://fb.com/tailieudientucntt Stage 1: Problem Recognition c om Occurs when consumer sees difference between current state and ideal state th Marketers can create: an co ng • Need recognition: actual state moves downward • Opportunity recognition: ideal state moves upward du o product category ng • Primary demand: encourage consumers to use cu u • Secondary demand: persuade consumers to use specific brand Hoang Duc Binh, 2008 CuuDuongThanCong.com https://fb.com/tailieudientucntt .c om Strategic Implications of Product Categorization (cont.) • Exemplar products • Brands strongly associated with a category “call ng th an co ng the shots” by defining evaluative criteria • But “moderately unusual” products stimulate more information processing and positive evaluations u du o • Locating products • Products that not fit clearly into categories cu confuse consumers (e.g., frozen dog food) Hoang Duc Binh, 2008 CuuDuongThanCong.com https://fb.com/tailieudientucntt Product Choice c om • Selecting among alternatives • Once we assemble and evaluate relevant options cu u du o ng th an co ng from a category, we must choose among them • Decision rules for product choice can be very simple or very complicated • Prior experience with (similar) product • Present information at time of purchase • Beliefs about brands (from advertising) Hoang Duc Binh, 2008 CuuDuongThanCong.com https://fb.com/tailieudientucntt Evaluative Criteria c om • Evaluative criteria: dimensions used to judge merits of competing options co ng • Determinant attributes: features we use to cu u du o ng th an differentiate among our choices • Criteria on which products differ carry more weight • Marketers educate consumers about (or even invent) determinant attributes • Pepsi’s freshness date stamps on cans Hoang Duc Binh, 2008 CuuDuongThanCong.com https://fb.com/tailieudientucntt Evaluative Criteria (cont.) c om • Procedural learning: cognitive steps before making cu u du o ng th an co ng choice • Marketers often point out significant differences among brands on relevant attribute… • Then supply consumers with decision-making rule (“if, then”) that has helped them make previous decisions Hoang Duc Binh, 2008 CuuDuongThanCong.com https://fb.com/tailieudientucntt Neuromarketing c om • Neuromarketing: uses functional magnetic ng resonance imaging, a brain-scanning device that tracks blood flow as we perform mental tasks co • Marketers measure consumers’ reactions to movie cu u du o ng th an trailers, choices about automobiles, the appeal of a pretty face, and loyalty to specific brands Hoang Duc Binh, 2008 CuuDuongThanCong.com https://fb.com/tailieudientucntt Cybermediaries c om • The Web delivers enormous ng amounts of product information in seconds co • Cybermediary: helps filter and du o ng th an organize online market information • Examples: Shopping.com BizRate.com MySimon.com NextTag.com PriceGrabber.com PriceSCAN.com cu u Click photo for Shopping.com Hoang Duc Binh, 2008 CuuDuongThanCong.com https://fb.com/tailieudientucntt Cybermediaries (cont.) c om • Intelligent agents and collaborative filtering • Learn from past user behavior to recommend ng co an • new purchases “Shopping robots” filtering cu u du o ng th • Electronic recommendation agents • Asks user to communicate preferences • Recommends list of sorted alternatives • Findings associated with such agents Hoang Duc Binh, 2008 CuuDuongThanCong.com https://fb.com/tailieudientucntt Heuristics: Mental Shortcuts c om • Heuristics: mental rules-of- cu u du o ng th an co ng thumb that lead to a speedy decision • Examples: higher price = higher quality, buying the same brand your mother bought Click photo for iparty.com • Can lead to bad decisions due to flawed assumptions (especially with unusually named brands) Hoang Duc Binh, 2008 CuuDuongThanCong.com https://fb.com/tailieudientucntt Relying on a Product Signal c om • Product signal: observable product attributes that ng communicate underlying qualities • Clean and shiny car = good mechanical condition th an co • Covariation: perceived associations among events • Product type/quality and country of origin • Consumers are poor estimators of covariation cu u du o ng (self-fulfilling prophecy: we see what we are looking for) Hoang Duc Binh, 2008 CuuDuongThanCong.com https://fb.com/tailieudientucntt Market Beliefs c om • Consumer assumptions about companies, products, and stores that become shortcuts for decisions co ng • Price-quality relationship: we tend to get what we pay for du o ng th an • Other common marketing beliefs • All brands are basically the same • Larger stores offer better prices than smaller u cu • stores Items tied to “giveaways” are not a good value Hoang Duc Binh, 2008 CuuDuongThanCong.com https://fb.com/tailieudientucntt • We rate our own country’s ng products more favorably than people who live elsewhere c om Country-of-Origin an th better products than developing countries co • Industrialized countries make du o ng • Attachment to own versus cu u other cultures • Nationalists • Internationalists • Disengaged Hoang Duc Binh, 2008 CuuDuongThanCong.com https://fb.com/tailieudientucntt Choosing Familiar Brand Names c om • Zipf’s Law: our tendency to prefer a number one an co ng brand to the competition • Brands that dominate the market are sometimes 50% more profitable than their nearest competitors ng th • Consumer inertia: the tendency to buy a brand out of du o habit merely because it requires less effort • Brand loyalty: repeat purchasing behavior that cu u reflects a conscious decision to continue buying the same brand Hoang Duc Binh, 2008 CuuDuongThanCong.com https://fb.com/tailieudientucntt .c om Hypothetical Alternatives for a TV Set ng Precision Kamashita Excellent Excellent Excellent Poor Excellent Excellent Excellent Poor Excellent Poor Poor Good Good Good Excellent Poor good Stereo broadcast capability Onscreen programming Sleep timer cu u Cable-ready capability du o Brand reputation th Size of screen Prime Wave co Importance Ranking an Attribute ng Brand Ratings Hoang Duc Binh, 2008 Table 9.4 CuuDuongThanCong.com https://fb.com/tailieudientucntt Decision Rules c om • Noncompensatory decision rules when we feel that a co ng product with a low standing on one attribute can’t compensate for this flaw by doing better on another attribute ng th an • Types of noncompensatory decision rules: • Lexicographic rule, consumers select the brand cu u du o that is the best on the most important attribute • Elimination-by-aspects rule: the buyer also evaluates brands on the most important attribute • Conjunctive rule: entails processing by brand Hoang Duc Binh, 2008 CuuDuongThanCong.com https://fb.com/tailieudientucntt Decision Rules (cont.) c om • Compensatory decision rules: give a product a chance to make up for its shortcomings an co ng • Types of compensatory decision rules: • Simple additive rule: the consumer merely du o cu u • ng th chooses the alternative that has the largest number of positive attributes Weighted additive rule: the consumer also takes into account the relative importance of positively rated attributes, essentially multiplying brand ratings by importance weights Hoang Duc Binh, 2008 CuuDuongThanCong.com https://fb.com/tailieudientucntt ... satisfaction • Behavioral influence perspective: consumers buy based on environmental cues, such as a sale • Experiential perspective: consumers buy based on totality of product’s appeal Hoang Duc... surveys the co ng environment for appropriate data to make reasonable decision an Prepurchase versus Ongoing Search ng th Prepurchase Search Ongoing Search Involvement with purchase Involvement with... magnetic ng resonance imaging, a brain-scanning device that tracks blood flow as we perform mental tasks co • Marketers measure consumers? ?? reactions to movie cu u du o ng th an trailers, choices about