Consumer Behavior 2nd Edition Kardes

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 Chapter 10

Product Consideration, Evaluation, and Choice

Outline

Chapter Objectives
Chapter Summary
Teaching Suggestions
Opening Vignette
The Consideration Set: Determining Choice Alternatives
Influencing the Consideration Set
Constructing Evaluations to Make Choices
Stimulus-Based, Memory-Based, and Mixed Choice
Attitude- Versus Attribute-Based Choice Strategies
Choice Based on Heuristic Processing
Prediction Heuristics
Choice Heuristics
Review and Discussion Questions

Chapter Objectives

After studying this chapter, you will be able to...

Objective 1—Explain the stages of consumer choice.

Objective 2—Describe several marketing techniques for influencing consumers’
consideration sets.
Objective 3—Define stimulus-based, memory-based, and mixed choice.
Objective 4—Explain the MODE model.
Objective 5—Explain how many different heuristics or shortcuts are used to simplify
prediction and choice.

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Chapter Summary

Consumer choice involves choosing one brand from a set of products. The set of
products that consumers think about and evaluate—the consideration set—usually consists of
fewer than seven brands, but the best brand is not always included in the consideration set.
The more consumers think about some brands, the more difficult it is to think about other
brands (the part-list cuing effect). Moreover, a given brand can seem attractive (the attraction
effect) or unattractive depending on what other brands are included in the consideration set.
Compromise brands, or brands that are average on multiple dimensions, often have an
advantage over brands that are good on some dimensions and bad on others (the compromise
effect). Attraction and compromise effects are often more pronounced when consumers feel
the need to justify or explain their decisions to themselves or others.

After the consideration set has been determined, consumers need to evaluate the
differences in features and attributes between the considered brands in order to make a
choice. When consumers can directly and physically observe all relevant brands in the
consideration set and the brand attributes, they make a stimulus-based choice. But when
brand alternatives are drawn from memory, choice is memory-based. Mixed choice combines
both stimulus-based and memory-based choices. In addition, choice often involves focusing
on differences among brands and using these differences as reasons or justifications for
making decisions. These differences may be general (attitude-based choice) or specific
(attribute-based choice), depending on the accessibility (salience in memory) and the
diagnosticity (relevance) of the information used as a basis for choice.

Choice heuristics are mental shortcuts that simplify difficult decisions. Consumers
use many different choice heuristics. Sometimes consumers focus on only one attribute (the
lexicographic heuristic), and sometimes consumers eliminate brands that do not have a
desired feature (the elimination-by-aspects heuristic). On other occasions, consumers
compare two brands at a time and subtract the difference in the values of the attributes (the
additive-difference heuristic). In other circumstances, consumers can focus on only one
brand and choose the brand if it is satisfactory on all attributes (the conjunctive heuristic) or
satisfactory on one attribute (the disjunctive heuristic). Finally, consumers may simply add
up a product’s good and bad features and choose the best overall brand (the frequency of
good and bad features heuristic). Choice heuristics can lead to poor decisions when
consumers overlook important information. Nevertheless, consumers are often forced to use
choice heuristics when information overload, time pressure, or other stresses increase the
difficulty of decision making.

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 TEACHING NOTES

Teaching Suggestions

1. Ask a student which pizza places he or she would recommend to friends visiting from
out of town. If the student recommends only one place, then brand loyalty may be evident.
However, the student will probably recommend more than one place but no more than nine
places. You can use this example to illustrate memory- vs. stimulus-based choices. Memory-
based consideration sets typically include fewer brands than stimulus-based consideration
sets. You can demonstrate this by bringing a copy of the Yellow Pages with you or
conducting a quick search on the Internet to show just how many different pizza places exist
in the area (many more than nine, most likely). Then, ask if there are additional restaurants
that the student might recommend.

2. Have students go to a grocery store and locate several products that come in three
different sizes. Ask them to observe if marketers are using a compromise effect as a strategy
with these brands.

3. This chapter provides an opportunity to demonstrate some of the choice heuristics:

lexicographic, elimination-by-aspects, conjunctive, additive-difference, and frequency of
good/bad features. Ask students to consider the three brands below, rated 1-7 on four key
attributes, where 1 is the worst rating and 7 is the best rating. Importance weights (weight)
for the four attributes are provided, as are the minimum requirements for each attribute
(minimum).

Ratings from 1-7

Attribute weight Brand A Brand B Brand C Minimum
style 0.30 4 1 7 4
color 0.20 4 5 2 4
comfort 0.25 4 5 2 4
durability 0.25 4 5 2 5
1.00

Next, demonstrate that Brand A would be chosen if a consumer used a multi-attribute model
(e.g., information integration) to compute overall ratings. Interestingly, Brand A has no real
competitive advantage because it is rated 4, or average, on each attribute, while Brand B is
above average on every attribute except style, and Brand C is the opposite.

Multi-attribute Model
Brand A Brand B Brand C
1.20 0.30 2.10
0.80 1.00 0.40
1.00 1.25 0.50
1.00 1.25 0.50
4.00 3.80 3.50

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The conclusion is similar using an additive difference heuristic. Comparing brands A, B, and
C, one at a time, by subtracting differences and multiplying the differences by importance
weights, Brand A is superior to both Brands B and C, and Brand C is dominated by A and B.

Additive-Difference
A vs. B B vs. C A vs. C
0.90 −1.80 −0.90
−0.20 0.60 0.40
−0.25 0.75 0.50
−0.25 0.75 0.50
0.20 0.30 0.50

Next, show that Brand C would be chosen if a consumer employed the lexicographic
heuristic. Although Brand C performs poorly in three of the four attributes, it is rated highest
(7) on the most important attribute (style), which comprises 30% of the overall weight.

Finally, demonstrate that no brand would be selected if a consumer used the conjunctive
heuristic, because none of the three brands meet the minimum requirement on all four
attributes. This may lead to an interesting discussion about how consumers’ respond when
the market doesn’t meet their needs. They can:

1. Postpone their purchase until a new product meets their requirements

2. Reduce their minimum requirements, i.e., compromise their standards
3. Reconsider their ratings and increase the scores until a brand meets the minimum criteria
4. Get out of the market altogether by changing product categories.

By comparing the outcomes of several heuristics, students will see different brands may be
chosen depending on which heuristic or decision model is used.

Opening Vignette
The opening vignette describes a typical situation where a consumer may be faced with a
plethora of choices in a given product category. Often when consumers are faced with too
many choices, they try to simplify by using shortcuts or “rules of thumb,” called heuristics.

The Consideration Set: Determining Choice Alternatives

It is important to note that consumers employ a variety of decision-making processes,
depending on the nature of the task, as well as motivation, ability, and opportunity to process
the information.

▪ A consideration set is the group of brands that consumers think about buying when
they need to make a purchase.

▪ The brands included the consideration set can come from:

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 1. An evoked set of brands
2. Brands discovered during external information search
3. Point-of-purchase information

Influencing the Consideration Set

As the number of brands in the consumer’s consideration set increases, the likelihood
of a brand being chosen decreases. Accordingly, marketers try to limit the number of
competitors’ brands in the consideration set.

1. Part-list cuing involves presenting the names of just some brands when
consumers are trying to recall as many brands as possible.

▪ As a partial list of brands becomes more strongly connected with the

product category, it becomes difficult for the consumer to think of other
brands.

2. The attraction effect occurs when a target brand appears more desirable because it
is compared to inferior brands within the same cluster, or subgroup.

3. The compromise effect occurs when a middle-of-the-road brand appears

acceptable on all features and is chosen over brands that offer good and bad
features.

▪ The compromise brand seems like a safe choice.

▪ The probability of buying a compromise brand increases when consumers
are concerned about making a bad decision.
▪ Figure 10.2 provides a graphical representation of the attraction and
compromise effects.

Constructing Evaluations to Make Choices

Consumer choice involves selecting one product or brand from a set of possibilities.
Marketers must understand three critical issues:

1. The brands in the consideration set

2. The types of information used to detect and evaluate the differences among the
considered alternatives
3. How this information is ultimately used in the choice process

▪ Stimulus-based choice involves consumers directly and physically observing all

relevant brands in the consideration set and their brand attributes.

▪ Memory-based choice is a situation where none of the relevant brands and attributes
is directly and physically observable.

▪ Mixed choice is a situation where consumers can see some brands but must remember

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 others.

▪ Attitude-based choice occurs when consumers form overall evaluations and general
impressions of brands.

o Consumers typically rely on attitudes when drawing information from

memory.
o Attitude-based choice can occur only if consumers have previously formed
attitudes toward a brand.

▪ Attribute-based choice occurs when consumers compare the specific attributes or

features of each brand.

o When brands are similar and information is diagnostic, attribute-based choice

is preferable.
o In general, attitudes are more accessible, and attributes are more diagnostic.

▪ The MODE model holds that motivation and opportunity will determine the processes
that influence consumer choice.

o When motivation and opportunity are high, consumers are likely to deliberate
and use attribute-based choice.
o Figure 10.3 provides a graphical representation of the MODE model.

Choice Based on Heuristic Processing

When consumers think carefully about decisions, using all relevant information and
considering all implications, they are engaging in systematic processing. In contrast, when
consumers are unwilling or unable to use careful and effortful decision-making strategies,
they are using heuristics that enable them to make decisions quickly and easily.

Persuasion Heuristics
1. The length-implies-strength heuristic suggests “size matters.”
2. The liking-agreement heuristic is based on the assumption that consumers usually
agree with people they like
3. The consensus-implies-correctness heuristic is synonymous with “the bandwagon
effect.”

Prediction Heuristics
Good consumer decision making often requires accurate probability or likelihood
judgments about events, such as accurate predictions about future product
performance.

1. The representativeness heuristic involves consumers making predictions based on

perceived similarities between a specific target and a general category.

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 ▪ Private store brands often package their products in boxes with graphics
similar to national brands, hoping that the similarities will lead consumers to
predict that the store brands will perform similarly to leading national brands.
2. The availability heuristic is used by consumers to make predictions based on how
easily they can retrieve information from memory.

▪ Events that are highly memorable because of media exposure, frequent

exposure, or recent exposure, are easily recalled.

3. The simulation heuristic is used by consumers to make predictions based on how

easily an event or a sequence of events can be imagined or visualized.

▪ If an event or sequence of events is easy to imagine, it tends to be

overestimated. If an event or sequence of events is difficult to imagine, it
tends to be underestimated.

4. The anchoring-and-adjustment heuristic involves consumers making predictions

based on a first impression or an initial judgment (or anchor) and then shifting
(adjusting or fine-tuning) this judgment upward or downward depending on the
implications of the imagined possibilities.

▪ Consumers rarely adjust enough, and as a result, final judgments tend to be

too close to initial judgments.

▪ Figure 10.4 provides examples of the prediction heuristics.

Choice Heuristics
1. The lexicographic heuristic (or single-attribute heuristic) involves comparing all
brands on one key attribute, such as price, size, weight, reliability, durability,
calories, sugar, etc., and choosing the brand that performs the best on that single
attribute, while generally ignoring the other attributes.

2. Consumers using the elimination-by-aspects heuristic reject all brands that do not
have a key feature they want.

3. The additive-difference heuristic compares two brands at a time, one attribute at a

time, and subtracts the evaluative differences. This heuristic requires more effort
because arithmetic is used. However, more effort can lead to better decisions.

4. The conjunctive heuristic involves setting minimum values for all relevant
attributes and selecting the first brand that meets this value for each attribute.

5. The disjunctive heuristic sets an acceptable value, rather than a minimum value,
for all relevant attributes. Consumers select the first brand that meets this value on
one particular attribute—which is not necessarily the most important attribute.

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 6. The frequency of good and bad features heuristic involves counting the number of
good and bad product features and choosing the brand with the greatest difference
between the two.

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Answers to Review and Discussion Questions

1. How can marketers increase the likelihood that their brands will be included in
consumers' consideration sets?
Salient and vivid promotional campaigns and wide distribution networks increase brand
awareness, which increases the likelihood that a brand will be included in consumers’
consideration sets.

2. How can marketers use the part-list cuing effect to decrease the likelihood that
competitors' brands will be included in consumers' consideration sets?
Mentioning some competing brands by name makes it difficult to think of other
unmentioned competing brands.

3. Why does the trade-off contrast effect occur?

Trade-offs are often difficult to make, so consumers often use trade-offs between
attributes on multiple brands to help them decide what trade-off level seems reasonable.

4. Describe a situation in which you purchased a compromise brand. Why does

compromise seem like such a compelling reason on which to base a choice?
Purchasing a brand that is average in price and quality is easy to justify to oneself and
others. If an average brand is adequate, why pay more for a fancier brand?

5. How does the availability heuristic influence how consumers make predictions about
products?
Easy-to-remember events seem likely, and difficult-to-remember events seem unlikely. If
it is easy to remember many successful prior experiences with a product, consumers
predict that future successful experiences are likely as well.

6. How might the law of large numbers be related to word-of-mouth marketing?

Word-of-mouth marketing is simply when marketing messages, product information,
and/or peoples’ opinions of the product are passed from person to person through
informal conversation. A large number of satisfied customers implies that a product must
be a good product.

7. When are consumers likely to use a choice heuristic? When are they unlikely to do so?
Consumers are likely to use choice heuristics when involvement is low, choice difficulty
is high, or risk is low. Consumers are unlikely to use choice heuristics when involvement
is high, choice difficulty is low, or risk is high.

8. Choice heuristics are often noncompensatory. Explain what this means and explain
how this can lead to bad choices.
A noncompensatory choice heuristic means that a good attribute cannot compensate or
make up for a bad attribute. Whenever consumers overlook some attributes, they may
make a bad decision that they might later regret.

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9. Some choice heuristics involve comparing several brands on the same attribute or set
of attributes. Describe a situation in which you used one of these choice heuristics.
Consumers often compare many brands on price before making a purchase decision.
Other important attributes could be used as well.

10. Some choice heuristics involve focusing on one brand at a time rather than making
comparisons across brands. Describe a situation in which you used one of these choice
heuristics.
Consumers often consider only one brand when making a purchase decision, even when
that decision is major. If the first brand considered seems adequate, consumers often
choose that brand rather than look further.

Answers to Short Application Exercises and Managerial Application Challenges

Student responses, answers, and examples will vary on these open-ended Short Application
Exercises and Managerial Application Challenges.

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