Lecture 2

Question 1

When does ‘problem recognition’ occurs?

Answer 1

When a consumer sees a significant difference between his or her current state and a desired/ideal state.

Question 2

Two types of problem recognition

Answer 2

– Opportunity recognition:
Ideal state moves upward (e.g. when you want a new car)

– Need recognition:
Actual state moves downward (e.g. when you run out of gas)

Question 3

Information search reduces risks of decision making. What kind of risks?

Answer 3

• Financial
• Psychological
• Social (friends making jokes)
• Time
• Etc.

Question 4

Consumers need information to solve problems

Answer 4

• 1. Prepurchase vs. Ongoing search
• 2. Internal vs. External search
• 3. Deliberate vs. ‘accidental’ search

Question 5

Prepurchase search

Answer 5

Consumers recognize a need and search the marketplace for specific information

Question 6

Ongoing search

Answer 6

• Browsing for fun (intrinsic enjoyment of search process)

- Staying up-to-date on what’s happening in the market

Question 7

Internal search

Answer 7

Scanning our own memory for information about product alternatives
 Past experience/knowledge

Question 8

External search

Answer 8

Obtaining product information from the environment
	Advertisements
	Friends
	Consumer reports
	Etc.

Question 9

Deliberate search

Answer 9

Our knowledge may be the result of direct learning

 When you bought a birthday cake last month, you will probably know where to buy the best one now

Question 10

‘Accidental’ search

Answer 10

When information is acquired in a more passive manner

 Mere exposure to advertisements, packaging, sales promotion (created associations with products)

Question 11

Brand switching

Answer 11

• Changing brands even if the current brand satisfied the consumer’s needs

Question 12

When does ‘brand switching’ often happens?

Answer 12

Often happens when you are in a good mood or have little stimulation elsewhere (sensory-specific satiety)

Question 13

Sensory-specific satiety

Answer 13

• A cause of variety seeking when there is relatively little stimulation in the environment of a consumer
• Desire to choose new alternatives over familiar ones

Question 14

How many information is searched for?

Answer 14

• When it involves an important purchase
• When there is a need to learn about the purchase
• When information is easily obtained
• Depends on prior knowledge

Question 15

When do we stop searching?

Answer 15

We continue to search until the costs exceed the utility of information search (as long as the process is not too time-consuming). We will continue when it’s still worth to search for.