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Chapter 10 JUDGMENT AND DECISION MAKING: HIGH CONSUMER EFFORT

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JUDGMENT AND DECISION MAKING: HIGH CONSUMER EFFORT Chapter Overview Judgment Thought-based (cognitive) decision making Four types of decision processes Feeling-based ... – PowerPoint PPT presentation

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Title: Chapter 10 JUDGMENT AND DECISION MAKING: HIGH CONSUMER EFFORT


1
Chapter 10JUDGMENT AND DECISION MAKING HIGH
CONSUMER EFFORT
2
A General Model of Consumer Problem Solving
Problem Recognition
Search for Information
Evaluation of Alternatives
Choice Decision
Purchase
Postpurchase Use and Reevaluation
3
Chapter Overview
  • Judgment
  • Thought-based (cognitive) decision making
  • Four types of decision processes
  • Feeling-based (affective) decision making
  • Decisions when comparison of alternatives is
    difficult
  • How context impacts decisions
  • Framing

4
Judgments vs. Decisions
Evaluations actual choice between alternatives
not made
Judgments
Choice between alternatives based in part on
judgments
Decisions
5
Decision-Making Issues
  • Rational decision criteria
  • decisions well thought out alternatives compared
  • cost vs. benefit
  • Emotional bases
  • how does each option make you feel?

One credit card offers a low interest rate, but
another has an extended warranty.
The American Express card make me feel
successful!
6
Cognitive Decision Making (High Effort)
  • Compensatory vs. non-compensatory models
  • Brand vs. attribute-based processing

I got an F in Calculus. Who cares--I got an A
in intro to golf!
7
Types of Decision Models
Compensatory Noncompensatory
Processing by Brand Processing by Attribute
Multi-attribute (e.g. TORA)
Conjunctive Disjunctive
Additive Difference
Lexicographic Elimination by aspects
8
Compensatory/Attribute Processing Models
  • Additive Difference Models
  • brands compared by attribute, two at a time
  • differences added up as decision maker proceeds
    by attribute e.g.
  • Brand A Brand B
    Difference
  • Attribute 1 3 4
    -1
  • Attribute 2 4 2
    2
  • Attribute 3 6 4
    2
  • ----------------------
    ------------------------------
  • TOTAL (A vs. B) 3

9
Noncompensatory Brand Processing Models
  • Conjunctive models
  • acceptability cutoffs (minimums) set for each
    attribute
  • AND rule
  • Disjunctive model
  • set high standards for attributes
  • OR rule

10
Noncompensatory Attribute Processing Models
  • Lexicographic Model
  • Attributes ordered by importance
  • Stop when one choice dominates
  • Elimination by aspects
  • Attributes ordered by importance
  • Stop when only one option remains

11
Reality of Consumer Decision Making
  • Consumers may use multiple decision-making
    strategies

12
Group Application Exercise Cognitive Decision
Making
  • Get into groups of 3-5. You will be assigned ONE
    of the 3 decision making approaches shown below.
  • (1)Noncompensatory/Processing by brand
  • (2)Noncompensatory/Processing by attribute
  • (3)Compensatory/Processing by attribute
  • Write a scenario showing how your cognitive
    decision making approach could be applied to
    deciding what college to attend.

13
Marketing Implications
  • Product D
  • Product P
  • Cut-off Levels for Product Design
  • Rank order of Attributes
  • Encourage Switching between decision models

14
High-Effort Feeling-Based Decisions
  • Common for offerings with hedonic, symbolic, or
    aesthetic attributes
  • Is frequently combined with cognitive processing

15
Deciding Between Non-Comparable Alternatives
  • Alternative- based strategy
  • overall evaluation of each option
  • Attribute-based strategy
  • abstract evaluation of alternatives for each
    option

16
Decision-Making Context
  • Consumer characteristics
  • motivation to process
  • ability to process
  • opportunity to process
  • Task characteristics
  • consideration set
  • availability of info
  • Framing
  • by the consumer
  • external framing

17
Chapter 10 Review
  • Judgement
  • Rational Decision Making
  • Compensatory vs. Noncompensatory
  • Processing by Brand vs. Processing by Attribute
  • Affective Decision Making
  • Deciding When Alternatives Cant Easily be
    Compared
  • Influence of Context on Decision Making
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