The process of making decisions
Chapter 7 Problem Recognition and Information Search
Problem recognition is the perceived difference between and ideal state and an actual state,
which motivates the consumer to action. It only occurs when consumers become aware of a
discrepancy between these two states. The greater to discrepancy the higher the MOA, the more
likely consumers are to act. Problem recognition relates to consumption, disposition and
acquisition.
The ideal state can rely on simple expectations, usually based on past experiences. The ideal state
can also be a function of our future goals and aspirations. Both expectations and aspirations are
often stimulated by our own personal motivation. Social class and reference groups also shape
our ideal state. Major changes in personal circumstances can instigate new ideal states.
Factors influencing our actual state can be physical factors, malfunction, obsolesce, unexpectedly
needing a service, needs and external stimuli.
Marketing implications: marketing can help put consumers in the problem recognition mindset
and motivate them to start their decision-making process. 2 techniques used to stimulate
problem recognition: attempt to create a new ideal state and create dissatisfaction with the
actual state.
Types of Information search:
Internal
External
Internal Information Search:
Because consumers have limited capacity and ability to process information and because
memory traces can decay over time consumers are likely to recall only a subset of stored
information when engaging in internal search:
How much do we engage in internal search?
The extent to which consumers devote to internal search depends on their MOA to process
information. Thus, consumers will attempt to recall more information when felt involvement,
perceived risk, or the need for cognition is high. Time pressure or distractions will limit internal
search.
What kind of information is retrieved from internal search?
Much of the research on the role of internal search in consumer judgment and decision-making
has focused on what is recalled.
,Specifically, 4 major types of information:
1. Recall of brands
Rather than remembering all available brand, consumers tend to recall a subset, known
as a consideration or evoke set. A small consideration set is usually necessary because
consumers’ ability to recall brand information decreases as the size of the set increases.
However, if they do not recall the entire set from memory, stored information aids the
recognition process. Consideration sets vary in size, stability, variety, and preference
dispersion (the equality of preferences toward brands or products in the set).
Factors increasing the possibility of consumers’ recalling a particular brand during
internal; search, and including in their consideration set:
Protopicality
Brand familiarity
Goals and usage situations
Brand preference
Retrieval cues
2. Recall of attributes
The attribute information we recall tends to be in summary or simplified form rather
than in its original detail, and can strongly influence their brand choices.
Factors influencing attribute recall:
Accessibility or availability
Diagnosticity
Diagnostic information helps us distinguish objects from one another. If
information is both accessible and diagnostic, it has a very strong influence in the
decision-making process.
Salience
Salient attribute; attribute that is top of mind or more important. For
information to be recalled and entered into the decision, it must have attribute
determinance, which means the information is both salient and diagnostic.
Vividness
Vivid information is easier to recall than less dramatic information, but it only
tends to influence judgment and decision-making when consumers have not
formed a strong prior evaluation, especially one that is negative. Also, vividness
affects attitudes only when the effort required to process the information
matches the amount of effort the consumer is willing to put forth.
Goals
3. Recall of evaluations
Because our memory for specific details decays rapidly over time, we find overall
evaluations or attitudes easier to remember than specific attribute information. In
addition, our evaluations tend to form strong associative inks with the brand.
, This tendency is the reason that it is important for a marketer encourage positive
attitudes towards its brand or offering. Evaluations are also more likely to be recalled by
consumers who are actively evaluating the brand when they are exposed to relevant
information.
Online processing; when a consumer is actively evaluating a brand as he/she views an ad
for it.
4. Recall of experiences
Experiences that are more vivid, salient, or frequent are the most likely to be recalled.
Marketing implications:
Marketers should associate their products or services with positive experiences or images to
increase their recall from consumers’ memory. Marketers should monitor negative recall
experiences and address them accordingly.
Is internal search always accurate?
3 biases have important marketing implications:
Confirmation bias
Refers to our tendency to recall information that reinforces or confirms our overall
beliefs rather than contradicting them, thereby making our judgment or decision
more positive than it should be. Selective perception; we see what we want to see.
Inhibition
All variables influencing the recall of certain attributes can lead to inhibition or recall
for other diagnostic attributes. Inhibition can lead to a biased judgment or decision
because consumers may remember but still ignore important and useful information.
Mood
Consumers are more likely to recall information, feelings, and experiences that match
their mood.
Marketing implications:
Marketers try to attack the confirmation bias problem by drawing attention to the negative
aspects of competitive brands through comparative advertising.
Inhibition is an important aspect for two reasons. First, consumers may not always consider key
aspects of a brand when making a decision because they recall other, more accessible attributes
instead. Second, marketers can sometimes offset the effect of their brand’s disadvantages and/or
their competitors’ advantages by drawing attention to more vivid or accessible attributes.
, External Information Search:
Consumers use external search to collect additional information about which brands are available
as well as about the attributes and benefits associated with brands in the consideration set.
Two types:
Prepurchase search
Occurs in response to the activation of problem recognition; the goal is to make better
purchasing decisions. Outcomes; increased product knowledge, better purchase decision,
increased satisfaction with the purchase outcome.
Ongoing search
Occurs on a regular and continual basis, even when a problem recognition has not been
activated; the goal is to build a bank of information for future use, and experience fun
and pleasure. Outcomes; increased product and market knowledge leading to future
buying efficiencies and personal influence, increased impulse buying, increased
satisfaction from search and other outcomes.
5 key aspects of the external search process:
1. The source of the information:
Retailer search
Media and social media search
Interpersonal search
Independent search
Experiential search
o Internet and Social media sources
Speed, user control, and two-way communication capability are key elements of
website interactivity for conducting online searches.
o Information overload
Depending on the way the information is structured, an overload can lead to a
decline in decision quality.
o Simulations
o The online community
2. The extent of external research
When researching experience goods (products that cannot be easily evaluated until after
purchase and use), consumers tend to dig into the details and spend some time on each
webpage. When researching search goods (products that can be evaluated before
purchase and use), consumers tend to cast the net wider, searching more site but
spending less time on each site.
Chapter 7 Problem Recognition and Information Search
Problem recognition is the perceived difference between and ideal state and an actual state,
which motivates the consumer to action. It only occurs when consumers become aware of a
discrepancy between these two states. The greater to discrepancy the higher the MOA, the more
likely consumers are to act. Problem recognition relates to consumption, disposition and
acquisition.
The ideal state can rely on simple expectations, usually based on past experiences. The ideal state
can also be a function of our future goals and aspirations. Both expectations and aspirations are
often stimulated by our own personal motivation. Social class and reference groups also shape
our ideal state. Major changes in personal circumstances can instigate new ideal states.
Factors influencing our actual state can be physical factors, malfunction, obsolesce, unexpectedly
needing a service, needs and external stimuli.
Marketing implications: marketing can help put consumers in the problem recognition mindset
and motivate them to start their decision-making process. 2 techniques used to stimulate
problem recognition: attempt to create a new ideal state and create dissatisfaction with the
actual state.
Types of Information search:
Internal
External
Internal Information Search:
Because consumers have limited capacity and ability to process information and because
memory traces can decay over time consumers are likely to recall only a subset of stored
information when engaging in internal search:
How much do we engage in internal search?
The extent to which consumers devote to internal search depends on their MOA to process
information. Thus, consumers will attempt to recall more information when felt involvement,
perceived risk, or the need for cognition is high. Time pressure or distractions will limit internal
search.
What kind of information is retrieved from internal search?
Much of the research on the role of internal search in consumer judgment and decision-making
has focused on what is recalled.
,Specifically, 4 major types of information:
1. Recall of brands
Rather than remembering all available brand, consumers tend to recall a subset, known
as a consideration or evoke set. A small consideration set is usually necessary because
consumers’ ability to recall brand information decreases as the size of the set increases.
However, if they do not recall the entire set from memory, stored information aids the
recognition process. Consideration sets vary in size, stability, variety, and preference
dispersion (the equality of preferences toward brands or products in the set).
Factors increasing the possibility of consumers’ recalling a particular brand during
internal; search, and including in their consideration set:
Protopicality
Brand familiarity
Goals and usage situations
Brand preference
Retrieval cues
2. Recall of attributes
The attribute information we recall tends to be in summary or simplified form rather
than in its original detail, and can strongly influence their brand choices.
Factors influencing attribute recall:
Accessibility or availability
Diagnosticity
Diagnostic information helps us distinguish objects from one another. If
information is both accessible and diagnostic, it has a very strong influence in the
decision-making process.
Salience
Salient attribute; attribute that is top of mind or more important. For
information to be recalled and entered into the decision, it must have attribute
determinance, which means the information is both salient and diagnostic.
Vividness
Vivid information is easier to recall than less dramatic information, but it only
tends to influence judgment and decision-making when consumers have not
formed a strong prior evaluation, especially one that is negative. Also, vividness
affects attitudes only when the effort required to process the information
matches the amount of effort the consumer is willing to put forth.
Goals
3. Recall of evaluations
Because our memory for specific details decays rapidly over time, we find overall
evaluations or attitudes easier to remember than specific attribute information. In
addition, our evaluations tend to form strong associative inks with the brand.
, This tendency is the reason that it is important for a marketer encourage positive
attitudes towards its brand or offering. Evaluations are also more likely to be recalled by
consumers who are actively evaluating the brand when they are exposed to relevant
information.
Online processing; when a consumer is actively evaluating a brand as he/she views an ad
for it.
4. Recall of experiences
Experiences that are more vivid, salient, or frequent are the most likely to be recalled.
Marketing implications:
Marketers should associate their products or services with positive experiences or images to
increase their recall from consumers’ memory. Marketers should monitor negative recall
experiences and address them accordingly.
Is internal search always accurate?
3 biases have important marketing implications:
Confirmation bias
Refers to our tendency to recall information that reinforces or confirms our overall
beliefs rather than contradicting them, thereby making our judgment or decision
more positive than it should be. Selective perception; we see what we want to see.
Inhibition
All variables influencing the recall of certain attributes can lead to inhibition or recall
for other diagnostic attributes. Inhibition can lead to a biased judgment or decision
because consumers may remember but still ignore important and useful information.
Mood
Consumers are more likely to recall information, feelings, and experiences that match
their mood.
Marketing implications:
Marketers try to attack the confirmation bias problem by drawing attention to the negative
aspects of competitive brands through comparative advertising.
Inhibition is an important aspect for two reasons. First, consumers may not always consider key
aspects of a brand when making a decision because they recall other, more accessible attributes
instead. Second, marketers can sometimes offset the effect of their brand’s disadvantages and/or
their competitors’ advantages by drawing attention to more vivid or accessible attributes.
, External Information Search:
Consumers use external search to collect additional information about which brands are available
as well as about the attributes and benefits associated with brands in the consideration set.
Two types:
Prepurchase search
Occurs in response to the activation of problem recognition; the goal is to make better
purchasing decisions. Outcomes; increased product knowledge, better purchase decision,
increased satisfaction with the purchase outcome.
Ongoing search
Occurs on a regular and continual basis, even when a problem recognition has not been
activated; the goal is to build a bank of information for future use, and experience fun
and pleasure. Outcomes; increased product and market knowledge leading to future
buying efficiencies and personal influence, increased impulse buying, increased
satisfaction from search and other outcomes.
5 key aspects of the external search process:
1. The source of the information:
Retailer search
Media and social media search
Interpersonal search
Independent search
Experiential search
o Internet and Social media sources
Speed, user control, and two-way communication capability are key elements of
website interactivity for conducting online searches.
o Information overload
Depending on the way the information is structured, an overload can lead to a
decline in decision quality.
o Simulations
o The online community
2. The extent of external research
When researching experience goods (products that cannot be easily evaluated until after
purchase and use), consumers tend to dig into the details and spend some time on each
webpage. When researching search goods (products that can be evaluated before
purchase and use), consumers tend to cast the net wider, searching more site but
spending less time on each site.
