134A- Chapter 16 Alternative Evaluation and Selection

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rational choice theory

Consumer has sufficient skills to calculate which option will maximize their value, and will choose on this basis
Tries to identify or discover one optimal choice for the decision

bounded rationality

A limited capacity for processing information; goals often have different goals than that of selecting the optimal alternative

metagoal

refers to the general nature of the outcome being sought

four common metagoals for consumer decisions

o Maximize accuracy of decision
§ Only assumed goal
o Minimize cognitive effort
§ Goal in nominal and limited decision making, play role in extended decision making
o Minimize experience of negative emotion
§ Used to avoid or delay decision
o Maximize case with a decision that can be justified
§ Beings are compelled to justify a decision, particularly true for luxury items
§ Anticipating such need can affect initial decision

affective choice

tend to be more holistic in nature, the evaluation of product focused on the way it will make the user feel
· Occurs when the underlying motive is consummatory rather than instrumental

Consummatory motives

Underlie behaviors that are intrinsically rewarding to the individual

Instrumental motives

Activate behaviors designed to achieve a second goal

Attribute-based choice

o Requires the knowledge of specific attributes at the time choice is made, involves attribute-by-attribute comparison across brands
o Occurs when the importance of an optimal decision is high, buying running shoes for a marathon

Attitude-based choice

o Involves the use of general attitudes, summary impressions, intuitions, or heuristics; no attribute-by-attribute comparison is made at time of decision
o Occurs with less involved products, buying shoes to wear around campus

Evaluative criteria

are various dimensions, features, or benefits a consumer looks for in response to specific problem
· Typically product features or attributes associated with either benefits desired or costs they incur
· In some cases the evaluative criterion and desired benefit are not identical, in this case focus should be put on the benefit the feature will provide

How can you determine which evaluative criteria consumers use?

Marketers can either use direct or indirect methods

Direct methods

o Asking consumers what criteria they use in particular purchase, or noting what consumers say about products and attributes in focus groups

Indirect methods

o Assume consumers will not or cannot state their evaluative criteria
o Projective techniques
§ Allows respondent to indicate criteria someone might use
o Perceptual mapping
§ No criteria are specified, consumer ranks similarities between products, information is gathered and unnamed evaluative criteria dimensions are configured

What methods are available for measuring consumers' judgments of brand performance on specific attributes?

· Variety of methods... rank ordering scales, semantic differential scales, and Likert scales; semantic differential scale most widely used
· Non are very effective at measuring emotional response or products

How can the importance assigned to evaluative criteria be assessed?

Measured by direct or indirect methods, usage situation should be specified as attribute importance varies
· Constant sum scale most common direct method of measurement
· Conjoint analysis is most popular indirect method
o Consumer is presented with a set of products or product descriptions which evaluative criteria vary

Sensory Discrimination

is the ability of an individual to distinguish between similar stimuli
· Individuals typically do not notice relatively small difference between brands or changes in brand attributes
· Due to complexity of some products and services, performance can only be judged after extensive use
· The inability of consumers to accurately evaluate many products can result in inappropriate purchases (lower quality@ higher prices), this is a major concern for high-value brands

Surrogate indicators

are an attribute used to stand for or indicate another attribute
· Consumers often use such factors as price, advertising, intensity, warranties, brand, and country of origin as surrogate indicators
· Surrogate indicators are stronger when consumers lack expertise to make informed decisions
· Based on consumer belief that 2 features such as price level and quality level go together

What factors influence the importance of evaluative criteria?

Usage situation
o Situation which product or service is used and can have important influences the criteria used to make a choice ex. service/location in selecting restaurant
· Competitive context
o The lower the variance across competing brands on a given evaluative criterion, the less influence it is likely to have in the decision process
o When one criterion becomes unimportant, other become more important
· Advertising effects
o Can affect importance of evaluative criteria in number of ways
o An ad that increases attention and elaborate processing of an attribute which can increase its perceived importance/ influence in the decision

What types of decision rules exist for Decision Rules attribute-based choices? Non Compensatory

o Conjunctive decision rule
o Disjunctive decision rule
o Elimination-by-Aspect decision rule

Conjunctive decision rule

Establishes minimum required performance standards for each evaluative criterion and selects the first or all brands that meet or exceed these standards

Disjunctive decision rule

Establishes minimum level of performance for each important attribute
All brands that meet or exceed performance level for any key attribute is considered acceptable

Elimination-by-Aspect decision rule

§ Requires consumer to rank the evaluative criteria in terms of their importance and to establish a cutoff point for each criterion
§ Satisfactory performance at each stage

Lexicographic decision rule

§ Requires consumer to rank the criteria in order of importance
§ The consumer selects the brand that performs best on the most important attribute, if 2 or more brands tie on attribute, then they are evaluated on the second most important attribute
§ Seeks maximum performance at each stage

Compensatory Decision Rules

o The brand that rates highest on the sum of the consumers judgments of the relevant evaluative criteria will be chosen
o One very good performance on one evaluative criterion can compensate for poor performance on another evaluative criterion

How can knowledge of the decision rules assist a firm in developing marketing strategy?

Low-involvement generally involve relatively simple decision rules (conjunctive, disjunctive, elimination-by-aspects, or lexicographic
· Determining which rule or combination of rules the target consumers use in purchase situations is key when developing appropriate marketing strategy

Low-involvement

generally involve relatively simple decision rules (conjunctive, disjunctive, elimination-by-aspects, or lexicographic

High-involvement

decisions and purchases involving considerable perceived risk tend to increase evaluation efforts and often involve complex rules as well as stages of decision making with different attributes being evaluated using different rules at each stage

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