14-1 © 2007 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin

14-1© 2007 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin

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PART IV: CONSUMER DECISION PROCESSPART IV: CONSUMER DECISION PROCESS

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CHAPTERCHAPTER 1414

CONSUMER CONSUMER DECISION DECISION

PROCESS AND PROCESS AND PROBLEM PROBLEM

RECOGNITIONRECOGNITION© M. Hruby

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Consumer Behavior In The News…Consumer Behavior In The News…

One person’s problem is another person’s…One person’s problem is another person’s…

Many people would pay to Many people would pay to NOTNOT have snow. have snow.

Indeed snow Indeed snow REMOVALREMOVAL is a major industry in is a major industry in colder climates.colder climates.

But would people pay to But would people pay to HAVE snowHAVE snow??

Source: A. Warren, “Winter Wonderland at 72˚,” The Wall Street Journal, December 23, 2003, p. B1/4.

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Consumer Behavior In The News…Consumer Behavior In The News…

One person’s problem is another person’s…One person’s problem is another person’s…

Would people pay to Would people pay to HAVE snowHAVE snow??

Turns out – yes!Turns out – yes!

People in warmer climates such as Texas, People in warmer climates such as Texas, Arizona, Florida, Georgia.Arizona, Florida, Georgia.

Often want snow for Christmas season but Often want snow for Christmas season but rarely get it naturally.rarely get it naturally.

So, they buy it!So, they buy it!

Source: A. Warren, “Winter Wonderland at 72˚,” The Wall Street Journal, December 23, 2003, p. B1/4.

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Types of Consumer DecisionsTypes of Consumer Decisions

Purchase involvementPurchase involvement is the level of concern for, or interest in, the purchase process.

Triggered by need to consider a particular purchase.

A temporary state influenced by the interaction of individual, product, and situational characteristics.

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A consumer may be very involved with a brand (e.g., Starbucks) or a product category, BUT…

have low purchase involvement due to brand loyalty, time pressures, etc.

Product involvementProduct involvement or enduring involvementenduring involvement is very different from purchase involvement.

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Types of Decision MakingTypes of Decision Making

1.1. Nominal Decision MakingNominal Decision Making

• Brand Loyal Purchases

• Repeat Purchases

2.2. Limited Decision MakingLimited Decision Making

3.3. Extended Decision MakingExtended Decision Making

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Nominal decisions occur when there is very low involvement with the purchase.

A completely nominal decision does not even include consideration of the “do not purchase” alternative. Consumer buys Campbell’s Consumer buys Campbell’s

without considering other without considering other brands, its price, etc.brands, its price, etc.

Nominal decision makingNominal decision making, a.k.a., habitual decision makinghabitual decision making, in effect involves no decision per se.

Nominal Decision MakingNominal Decision Making

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Nominal Decision MakingNominal Decision Making

Nominal decision can be broken into two categories:Nominal decision can be broken into two categories:

1.1. Brand Loyal PurchasesBrand Loyal Purchases

High commitment to brandHigh commitment to brand

2.2. Repeat PurchasesRepeat Purchases

Low commitment to brandLow commitment to brand

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Middle ground between nominal and extended decision making.

Involves recognizing a problem for which there are several possible solutions.

Decision based only on Decision based only on buying the cheapest rolls.buying the cheapest rolls.

Limited decision making Limited decision making involves internal and limited external search, few alternatives, simple decision rules on a few attributes, and little postpurchase evaluation.

Limited Decision MakingLimited Decision Making

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It is a response to the high level of purchase involvement.

During post-purchase evaluation, doubts are likely and a thorough evaluation takes place.

Emotional decisions may involve Emotional decisions may involve substantial cognitive effort.substantial cognitive effort.

Extended decision makingExtended decision making involves extensive internal and external search followed by a complex evaluation of multiple alternatives.

Extended Decision MakingExtended Decision Making

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The Process of Problem RecognitionThe Process of Problem Recognition

Problem recognitionProblem recognition is the result of a gap between a desired state and an actual state sufficient to arouse and activate the decision process.

An actual stateactual state is the way an individual perceives his/her feelings and situation to be at the present time.

A desired statedesired state is the way an individual wants to feel or be at the present time.

The Nature of Problem RecognitionThe Nature of Problem Recognition

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1. The magnitude of the discrepancy between the desired and actual states, and

2. The relative importance of the problem

Desire to resolve a particular problem depends on:

The Nature of Problem RecognitionThe Nature of Problem Recognition

In general, importance is determined by how critical the problem is to maintenance of desired lifestyle.

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Types of Consumer ProblemsTypes of Consumer Problems

Active Problem Active Problem

An active problemactive problem is one the consumer is aware of or will become aware of in normal course of events.

Marketing strategyMarketing strategy:

Only require marketer to convince consumers that its brand is the superior solution.

Inactive Problem Inactive Problem

An inactive probleminactive problem is one of which the consumer is not aware.

Marketing strategyMarketing strategy:

Marketer must convince consumers that they have the problem AND that their brand is a superior solution.

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Uncontrollable Determinants of Problem Uncontrollable Determinants of Problem RecognitionRecognition

Nonmarketing Factors Affecting Problem RecognitionNonmarketing Factors Affecting Problem Recognition

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Uncontrollable Determinants of Problem Uncontrollable Determinants of Problem Recognition Recognition

Variety-seekingVariety-seeking is a challenge to marketers because it means that consumers switch brands for reasons beyond a company’s control.

Sensory-specific satietySensory-specific satiety – consumers get bored (satiated) with sensory attributes more than on non-sensory attributes.

Offering variety on key sensory attributes can increase loyalty to the brand even if consumers engage in variety seeking.

Variety WITHIN brand can Variety WITHIN brand can drive loyalty in the face of drive loyalty in the face of

variety seeking.variety seeking.

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Marketing Strategy and Problem Marketing Strategy and Problem RecognitionRecognition

1.1. Discovering Consumer ProblemsDiscovering Consumer Problems

2.2. Responding to Consumer ProblemsResponding to Consumer Problems

3.3. Helping Consumers Recognize ProblemsHelping Consumers Recognize Problems

4.4. Suppressing Problem RecognitionSuppressing Problem Recognition

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A wide variety of approaches are used to determine the problems consumers face.

Discovering Consumer ProblemsDiscovering Consumer Problems

1.1. IntuitionIntuition - the most common, however, the problem identified may be of low importance to most consumers

2.2. Survey Survey – asks relatively large numbers of individuals about the problems they are facing

3.3. Focus Groups Focus Groups – composed of 8 to 12 similar individuals brought together to discuss a particular topic; a moderator is present to keep the discussion moving and focused on the topic but otherwise free flowing

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Surveys and focus groups use one of the following approaches to problem identification:


1. Activity Analysis Focuses on a particular activity to determine what problems consumers encounter during the performance of the activity.

2. Product Analysis Examines the purchase or use of a particular product or brand. Consumers may be asked about problems associated with using a product or brand.

3. Problem Analysis Starts with a problem and asks which activities, products, or brand are associated with (or perhaps could eliminate) those problems

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Human Factors ResearchHuman Factors Research

Human factors research attempts to determine human capabilities in areas such as vision, strength, response time, flexibility, and fatigue and the effect on these capabilities of lighting, temperature, and sound.

Observational techniques such as slow-motion and time-lapse photography, video recording, and event recorders are particularly useful methods.

This type of research can sometimes identify functional problems that consumers are unaware of.


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Emotion ResearchEmotion Research

Marketers are increasingly conducting research on the role of emotions in problem recognition and resolution.

Common approaches are focus group researchfocus group research and personal personal interviewsinterviews that examine the emotions associate with certain problems.

Critical in helping marketers anticipate consumer reaction to problems and train customer service personnel to respond appropriately.


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Once a consumer problem is identified, the manager may structure the marketing mix to solve the problem.

This can involve:

Responding to Consumer ProblemsResponding to Consumer Problems

• Developing a new product or altering an existing one

• Modifying channels of distribution

• Changing pricing policy, or

• Revising advertising strategy

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Generic versus Selective Problem RecognitionGeneric versus Selective Problem Recognition

Helping Consumers Recognize ProblemsHelping Consumers Recognize Problems

Generic Problem RecognitionGeneric Problem Recognition

• Involves a discrepancy that a variety of brands within a product category can reduce

• Increasing generic problem recognition generally results in an expansion of the total market

Selective Problem RecognitionSelective Problem Recognition

• Involves a discrepancy only one brand can solve

• Firms attempt to cause selective problem recognition to gain or maintain market share

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Approaches to Activating Problem RecognitionApproaches to Activating Problem Recognition

How can a firm influence problem recognition?

Recall that problem recognitionproblem recognition is a function of

(1) the importance, and

(2) the magnitude

of a discrepancy between the desired statedesired state and an existing state


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Approaches to Activating Problem RecognitionApproaches to Activating Problem Recognition


Many marketing efforts attempt to influence the desired state, often advertising the benefits their products will provide and hoping that these benefits will become desired by consumers.

It is also possible to influence perceptions of the existing state through advertisements.

Critics frequently question the ethics of activating problem recognition, especially for problems related to status or social acceptance.

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Applications in Consumer BehaviorApplications in Consumer Behavior

With permission by GlaxoSmithKline.

The Nicoderm CQ ad shows how marketers often attempt to cause consumers to recognize potential problems for which the product provides a solution.

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The Timing of Problem RecognitionThe Timing of Problem Recognition


Consumers often recognize problems at times when purchasing a solution is difficult or impossible, such as

• deciding to purchase a generator during a hurricane

• becoming aware of the need for health insurance after being hospitalized

A common marketing strategy is to trigger problem recognition in advance of the actual problem

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Suppressing Problem RecognitionSuppressing Problem Recognition


Occasionally information is introduced in the market place that triggers problem recognition that some marketers prefer to avoid.

Obviously marketers do not want their current customers to recognize problems with their brands.

Effective quality control and distribution (limited out-of-stock situations) are important in this effort.

Packages and package inserts that assure the consumer of the wisdom of their purchase are also common.

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14-1 © 2007 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin