Chapter 9 - Judgement & Decision Making

Question 1

What might a purchase be a response to?

Answer 1

A perceived problem

Question 2

What are the 4 rational steps of a consumer wanting to make a purchase?

Answer 2

1) Problem recognition
2) Information search
3) Evaluation of alternatives
4) Product choice

Question 2

What happens after the purchase is made?

Answer 2

We reflect on the quality of our decision and learn based on how the choice worked out
The learning process influences the likelihood that the same choice will be made in the future if a similar situation comes up

Question 3

What is a problem for modern consumers?

Answer 3

That they have too MANY choices, not too few

Question 4

What is consumer hyperchoice?

Answer 4

One of modern-day consumers’ biggest problems is that they have too many choices, not too few (as compared to how it used to be)

Having too many choices forces us to make repeated choices that can drain psychological energy, decreasing our ability to make smart decisions

Question 5

What is the rational view of decision-making?

Answer 5

People calmy and carefully integrate as much information as possible with what they already know, painstakingly weight the pluses and minuses of each alternative, and arrive at a satisfactory decision

It also assumes that we collect the most valuable units of information first

Question 6

What is wrong with the rational view of decision making?

Answer 6

There are a lot of instances where the decision making process is almost automatic, snap judgements

We cant always take the time to collect all of the information, evaluate the alternatives and make a satisfactory choice. If we are ordering fast food or coffee, not much thought goes into that

Question 7

How is the decision-making process different for high-involvement products vs low-involvement products?

Answer 7

High Involvement: For things like a car, house, or phone we will spend weeks agonizing over details, making sure our decisions are rational and thought out (weighing the pros and cons).

Low involvement: coffee, vending machine, which brand of pens to use. These things are often snap decisions where we don’t spend much time if at all evaluating the consequences.

Question 8

What is purchase momentum?

Answer 8

It occurs when initial impulses actually increase the likelihood that we will buy even more

Question 9

What is constructive processing?

Answer 9

evaluating the effort required to make a particular choice and choosing a strategy best suited to the level of effort required

Question 10

What is the process called that we use to evaluate whether to invest the brain power into evaluating a decision or to go without automatic choice?

Answer 10

Constructive processing

Question 11

What is the behavioral influence perspective?

Answer 11

When a customer’s decision is a learned response to environmental cues (low involvement)

Question 12

What must a manager concentrate on form behavioral influence perspective?

Answer 12

they must concentrate on assessing the characteristics of the environment
physical surroundings, product placement, things that influence the target market

Question 13

What is habitual decision-making?

Answer 13

decisions that are made with little or no conscious effort
routine, minimal effort, efficient way to operate, repetitive

Question 14

What is a bad thing about habitual decision-making? (for marketers)

Answer 14

When a marketer tries to introduce a new way of doing an old task, you must unfreeze their habits

This can be an uphill and challenging battle

Question 15

What is limited problem-solving?

Answer 15

decisions that are in the middle of automatic and in-depth processing/thinking.

they arent necessarily motivated to search for information or evaluate each alternative rigorously, but they aren’t simply acting out of habit either

Seeking for a ‘good enough’

System 1 - fast

Use of heuristics

Question 16

What assists limited problem-solving to make a decision?

Answer 16

Decision rules that are cognitive shortcuts act as general guidelines so we don’t have to start from scratch for every decision.

Question 17

What is extended problem solving?

Answer 17

Decisions that correspond to carry a fair degree of risk, and is closest to the traditional decision-making perspective.

System 2 - slow

Question 18

What is the process of extended problem-solving for the consumer?

Answer 18

the consumer tries to collect as much information as possible (from their memory and from outside sources),

each product is carefully evaluated

Question 19

What is problem recognition?

Answer 19

When we recognize a difference between our current state and where we want to be

Question 20

What is information search?

Answer 20

When the consumer surveys their environment for appropriate data to make a reasonable decision

Question 21

What is internal and external search in the information search step?

Answer 21

Internal search - scanning our memory banks / prior experience

Often this isn’t enough, so we rely on external search where information is obtained through advertisements, friends, or from people-watching

Question 22

What is directed learning?

Answer 22

on a previous occasion, we searched for relevant information or experienced some of the alternatives. Therefore we have a pretty good existing knowledge

Question 23

What is incidental learning?

Answer 23

Passive exposure to advertising, packaging, or sales promotion
Low dose exposure over time

Question 24

What is satisficing?

Answer 24

Since we do not have the resources or time to weigh every possible factor in a decision, we often settle for a solution that is just good enough

Question 25

What is variety seeking?

Answer 25

Where ones priority is to vary their experiences, they want to change things up to either reduce boredom or as a form of stimulation

Question 26

What are examples on when you would use extended problem solving?

Answer 26

expensive products, infrequently purchased, high involvement, unfamiliar

Question 27

What is habitual problem-solving?

Answer 27

Automatic
Cheaper products, frequently purchased, low involvement, familiar, little time spent

Question 28

What are nudges

Answer 28

strategies to influence people’s decision-making without significantly changing economic incentives or limiting options

Question 29

Should nudges be easy to avoid for customers?

Answer 29

Yes

Question 30

What are some examples of digital nudges?

Answer 30

Personalized recommendations
Social proofing (how many people have purchased the product)
Gamification

Question 31

What is the search aspect of the SEC classification of products/services?

Answer 31

Searching for info - before you buy you know what to expect

spec list for products

Question 32

What is the experience aspect of the SEC classification of products/services?

Answer 32

you buy, you see and experience, you know

Question 33

What is the credence aspect of the SEC classification of products/services?

Answer 33

I buy, I use, I still don’t know

The customer is looking for signals of product quality. They need reassurance

Question 34

What are examples of credence aspects of SEC classification?

Answer 34

Skincare, health / losing weight supplements, car maintenance

Question 35

What changed unboxing? What did it used to be and what is it now (search, experience, or credence)

Answer 35

Unboxings used to be experienced, now they are a search
This changed because of youtube, you can now research what the unboxing experience is going to look like

Question 36

What is an inept set?

Answer 36

the alternatives that you are aware of but wont consider buying because they arent what you are looking for

Question 37

What is an inert set?

Answer 37

The alternatives that aren’t coming to mind at all.

Question 38

What is the evoked set?

Answer 38

The alternatives actively considered during a customers choice process