ECON344 Chapter Notes - Chapter 4: Cognitive Dissonance

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CHAPTER 4 Consumer Behaviour
BU 352 Spring 2016
NEED RECOGNITION: When consumers recognize that there is something they need. BALANCE:
Functional Need: pertaining to the performance of a product/service
Psychological Need: personal gratification associated with a product (Prada shoes vs. cheap shoes)
INFORMATION SEARCH: When consumers search for the various options they have to satisfy the need.
Internal search: examine your own personal memory and knowledge about the product/service
External search: look to the internet, friends, salespeople, etc. for more information
Perceived costs v. Perceived Benefits: Is it even worth putting in all that time searching for this product?
Internal locus v. External locus: Do I have any say in the outcome? Why bother.
RISKS:
Performance: poorly performing product
Financial: initial cost as well as cost of using the item
Social: worry how others will regard your purchase
Physiological: aka safety risk
Psychological: how people will feel if their purchase isn’t conveying the right image
ALTERNATIVE EVALUATION: Use evaluation criteria to compare the alternatives. Consumers focus on determinant
attributes, which are important to them and differ between alternatives (something special).
CONSUMER DECISION RULES:
1. Compensatory: trading off one characteristic for another, such as a weight matrix
2. Noncompensatory: choosing a product based only on a subset of its attributes
3. Heuristics: Mental shortcuts to narrow down decision (price, brand, presentation)
PURCHASE DECISION: The Consumer decides on which product they want, but the decision does not always convert into
sale. To increase this conversion rate, you can create urgency, make the sale easy, and have adequate quantity on hand.
Ritual consumption ties consumption to life events, such as chocolate on Valentine’s Day.
POSTPURCHASE: after the purchase there can be…
1. satisfaction: make sure you aren’t over exaggerating the product’s capabilities
2. cognitive dissonance: aka buyer’s remorse, usually happens if the consumer feels they didn’t have all
the possible information at hand
3. loyalty: build lasting relationship with customer with repeat sales
4. negative word-of-mouth
Psychological
Social
Situational
Motives (maslows)
Family (products for the whole family
are influenced by all)
Purchase (buying for a wedding might
change your normal habits)
Attitude (affective = feel, behavioural
= action)
Reference Groups (people/groups a
consumers uses as a comparison)
Shopping (store atmosphere,
salespeople, crowding, promotions
etc.)
Perception (select, organize, and
interpret information)
Culture (beliefs, morals, customs
effect your decision)
Temporal (morning v. night person)
Learning (change in thought process
due to an event)
Lifestyle (how consumer spends time
and money)
Consumer can either have high involvement (care about the product) or low involvement.
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