consumer decision making ii mkt 750 dr. west. agenda back to stages of decision making evaluation of...
TRANSCRIPT
Agenda
Back to Stages of Decision MakingEvaluation of Alternative, Decision Rules, Choice and Post-purchase Evaluation
A Model of Customer Satisfaction
3
Rational Decision Making:
ChoiceAlternativeEvaluation
SearchNeed
RecognitionPost-Purchase
Evaluation
Evaluating Alternatives
Determine criteria to be used for evaluation of products
Assess the relative importance of the each criteria
Evaluate each product based on the identified criteria
Evaluating Alternatives
Criteria for the purchase of a car: Space Reliability Safety Longevity Handling Styling
Evaluating Alternatives
Assessing Importance: ei
Space 5 Reliability 4 Safety 4 Longevity 3 Handling 3 Styling 2
* Importance: 5=Most Important, 1=Least Important
Evaluating Alternatives
Beliefs Regarding Product Performance:
Product Evaluation: 4=Excellent, 3=Very Good, 2=Good, 1=Fair
bi’s
Importance
ei
ToyotaSienna
SubaruOutback
Volvo Cross
Country
Space 5 4 2 4
Reliability
4 3 4 3
Safety 4 3 3 4
Longevity
3 2 4 4
Handling 3 1 4 2
Styling 2 2 4 3
Decision Rules
Cutoffs/Thresholds: restriction or requirements for acceptable performance
Signals are product attributes used to infer other product attributes (e.g. high price often infers higher quality)
Decision Rules
Compensatory Rule: a perceived weakness of one attribute may be offset or compensated for by the perceived strength of another attribute
Noncompensatory Rule: a product’s weakness on one attribute cannot be offset by strong performance on another attribute
Compensatory Decision Rules
Simple additive (Equal Weight): bi The consumer adds the product
evaluations across the set of salient evaluative criteria. The product with the largest score is chosen.
Weighted additive: biei
Judgments of product evaluations are weighted according to importance
Simple Additive (Equal Weight)
biToyotaSienna
SubaruOutback
Volvo Cross
Country
Space 4 2 4
Reliability
3 4 3
Safety 3 3 4
Longevity
2 4 4
Handling 1 4 2
Styling 2 4 3
15 21 20
Weighted Additive
biei Importance
ToyotaSienna
SubaruOutback
Volvo Cross
Country
Space 5 4 (20) 2 (10) 4 (20)
Reliability
4 3 (12) 4 (16) 3 (12)
Safety 4 3 (12) 3 (12) 4 (16)
Longevity
3 2 (6) 4 (12) 4 (12)
Handling 3 1 (3) 4 (12) 2 (6)
Styling 2 2 (4) 4 (8) 3 (6)
57 70 72
Noncompensatory Decision Rules:
Lexicographic strategy: Brands are compared on their most important attribute, and the winner is chosen.
If there is a tie the second most-important is considered, and so on, until a choice is identified
Lexicographic Rule
Importance
ToyotaSienna
SubaruOutback
Volvo Cross
Country
Space 5 4 2 4
Reliability
4 3 4 3
Safety 4 3 3 4
Longevity
3 2 4 4
Handling 3 1 4 2
Styling 2 2 4 3
Lexicographic Rule
Importance
ToyotaSienna
SubaruOutback
Volvo Cross
Country
Space 5 4 2 4
Reliability
4 3 4 3
Safety 4 3 3 4
Longevity
3 2 4 4
Handling 3 1 4 2
Styling 2 2 4 3
Lexicographic Rule
Importance
ToyotaSienna
SubaruOutback
Volvo Cross
Country
Space 5 4 2 4
Reliability
4 3 4 3
Safety 4 3 3 4
Longevity
3 2 4 4
Handling 3 1 4 2
Styling 2 2 4 3
Noncompensatory Decision Rules:
Elimination by aspects (EBA): Brands are compared on an attribute by attribute basis.
Alternatives are eliminated that fall below the consumer imposed cutoffs.
Process continues until a single alternative remains.
Elimination by Aspects Rule
Cutoff = 3
Importance
ToyotaSienna
SubaruOutback
Volvo Cross
Country
Space 5 4 2 4
Reliability
4 3 4 3
Safety 4 3 3 4
Longevity
3 2 4 4
Handling 3 1 4 2
Styling 2 2 4 3
Noncompensatory Decision Rules:
Conjunctive strategy (Satisficing): Brand are evaluated, one at a time, against a set of thresholds established for each attribute.
The first brand that meets or exceeds the threshold for each attribute is chosen.
Conjunctive Rule
Cutoff = 2
ToyotaSienna
SubaruOutback
Volvo Cross
Country
Space 3 2 4
Reliability
3 4 3
Safety 3 3 4
Longevity
2 4 4
Handling 1 4 2
Styling 2 4 3
Very sensitive to order
Determinants of Satisfaction:
What happens when product performance doesn’t meet expectations?
Assimilation – a reluctance to acknowledge discrepancies via rationalization and attribution Contrast – the tendency to exaggerate differences, a phenomenon known as reactance
Assimilation & Contrast
Zon
e o
f Tole
ran
ce
AssimilationContrast
10
Favorable 9Performance 8
7
6 ExpectationUnfavorable 5 Performance 4
3 2
1
10 High ExpectationsFavorable 9Performance 8
7 6
Unfavorable 5 Performance 4
3 2
1
Expectancy Disconfirmation
Dis
sati
sfa
cti
on
S
ati
sfa
cti
on
Z
on
e Z
on
e
Negative Disconfirmation “Disappointment”
10 High ExpectationsFavorable 9Performance 8
7 6
Unfavorable 5 Performance 4
3 2
1
Expectancy Disconfirmation
Dis
sati
sfa
cti
on
S
ati
sfa
cti
on
Z
on
e Z
on
e
Negative Disconfirmation “Betrayal”
Expectancy Disconfirmation
Dis
sati
sfa
cti
on
S
ati
sfa
cti
on
Z
on
e Z
on
e
10
Favorable 9Performance 8
7 6
Unfavorable 5 Performance 4
3 2 1 Low Expectations
Positive Disconfirmation “Ambivalence”
Expectancy Disconfirmation
Dis
sati
sfa
cti
on
S
ati
sfa
cti
on
Z
on
e Z
on
e
10
Favorable 9Performance 8
7 6
Unfavorable 5 Performance 4
3 2 1 Low Expectations
Positive Disconfirmation “Elation”
Customer Satisfaction
Satisfaction influences repeat buying
Positive post-consumption evaluations are essential for retaining customers
The likelihood that customers will remain loyal depends on their level of satisfaction
Customer Satisfaction
Consumers often talk about their consumption experiences
A firm’s ability to satisfy customers will affect its success in retaining current customers as well as recruiting new ones
It Shapes Word-of-Mouth
Customer Satisfaction
Monitor satisfaction levels
Encourage dissatisfied customers to voice their concerns
Have a recovery system in place to address customer concerns
Implications for Competitive Strategy