331 consumer... · Web viewL01 Understand the activities involved in the consumer decision-making process. L02 Describe the three major decision-making research perspectives. L03

CHAPTER 12DECISION MAKING I: NEED RECOGNITION AND SEARCH

WHAT DO YOU THINK POLLING QUESTIONMost of the time I am a rational decision maker.Strongly disagree 1 2 3 4 5 6 7 Strongly agree

Have students access www.cengagebrain.com to answer the polling questions for each chapter of CB. Ask them to take the online poll to see how their answers compare with other students taking a consumer behavior course across the country. Then turn to the last page of the chapter to find the What Others Have Thought box feature. This graph is a snapshot of how other consumer behavior students have answered this polling question thus far.

LEARNING OUTCOMESAfter studying this chapter, the student should be able to:L01 Understand the activities involved in the consumer decision-making process.L02 Describe the three major decision-making research perspectives.L03 Explain the three major types of decision-making approaches.L04 Understand the importance of the consideration set in the decision-making process.L05 Understand the factors that influence the amount of search performed by consumers.

SUGGESTED LECTURE OPENERAnticipating and predicting how and why consumers make purchasing decisions is a vital part of marketing. The closer one’s product or service is to what a customer wants, the more likely a sale is to be made. Companies need not only to provide information, but the right kind of information. Sometimes what companies want to represent and what consumers want can differ. For example, demand for calorie labels has seen a recent spike, particularly in the fast-food industry, but some restauranteurs are reluctant to make this move. In a recent survey conducted by Aramark, a food services company, 83% of consumers want nutritional information available in restaurants. However, the question remains if providing this information will really affect food choices toward healthier options—some studies have shown that only 10-20% of diners make a lower-calorie choice based on nutritional information. [Source: Roni Caryn Rabin, “Calorie Labels May Clarify Options, Not Actions,” The New York Times, July 17, 2010, http://www.nytimes.com.]

LECTURE OUTLINE WITH POWERPOINT® SLIDES

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©2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 1

LO1. Understand the activities involved in the consumer decision-making process.

Consumer Decision MakingConsumers encounter problem situations each and every day. The basic consumer behavior consumption process is shown again in Exhibit 12.1 along with the decision-making process.

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To better visualize the decision-making process, review Exhibit 12.2. The decision-making process generally includes the following five activities:

1. Need recognition2. Search for information3. Evaluation of alternative4. Choice5. Postchoice evaluation

Note that consumers do not always move through the process in a sequential order nor do they always complete the process.

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Decision Making and ChoiceDecision-making processes frequently do not involve finding a tangible product. Rather, consumers make choices about behaviors that are not directly related to a purchase. The box feature discusses one of the biggest decisions that many consumers face—which college to attend. Students regularly start thinking about the choice of college during their early years in high school. Although students spend a handful of years on campus, this choice can have a profound impact on their lives.


Q: Ask students about their choice of college to attend. Did they follow the decision-making process? How did students search for information? What were their alternatives? How did they make their final decision?

A: Answers will vary. Some students might have used materials such as The Princeton Review, but this would be a good time to reinforce previous lecture examples of word-of-mouth marketing.

Decision Making and ValueBoth utilitarian value and hedonic value are associated with consumer decision making. As mentioned in the discussion about the concept of value, the car-buying experience involves both value types.

Decision Making and MotivationMotivations are the inner reasons or driving forces behind human actions as consumers are driven to address needs.

Decision Making and EmotionConsumer decision making is also closely related to emotion. The decision-making process can be very emotional depending on the type of product being considered or the need that has arisen. One example involves the difficult task of deciding which job offer to take when you graduate. Will the job offer be many miles away or closer to your family? Decisions like these can be quite emotional.

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LO2. Describe the three major decision-making research perspectives.

Decision-Making Perspectives

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Consumer researchers view the decision-making process from three perspectives. These perspectives are illustrated in Exhibit 12.3.

Rational Decision-Making PerspectiveThis perspective is considered by many to be the traditional approach to the decision-making process. The rational decision-making perspective assumes that consumers diligently gather information about purchases, carefully compare various brands of products on salient attributes, and make informed decisions regarding what brand to buy. The act of buying an appliance, such as a dishwasher, often follows a rational process.

Experiential Decision-Making PerspectiveThe experiential decision-making perspective assumes that consumers often make purchases and reach decisions based on the affect, or feeling, attached to the product or behavior under consideration. For example, a consumer may decide to spend time at a day spa as the result of an experiential decision-making process.

Behavioral Influence Decision-Making PerspectiveThe behavioral influence decision-making perspective assumes that many decisions are actually learned responses to environmental influences. From this perspective, behavior is influenced by environmental forces rather than by cognitive decision making.

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LO3. Explain the three major types of decision-making approaches.

Decision-Making Approaches

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Consumers reach decisions in a number of different ways. Generally speaking, as involvement and risk increase, consumers are motivated to move more carefully through the decision-making process. Consumers face several types of risk, including:1

Financial risk – This risk is associated with the cost of the product. Social risk – This risk is associated with how other consumers will view the purchase. Performance risk – This risk is associated with the likelihood of the product performing as expected. Physical risk – This risk is associated with the safety of the product and the likelihood that physical harm will result from its consumption. Time risk – This risk is associated with the time spent searching for the product and the time spent for the product to be serviced or maintained.

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Decision-making approaches can be classified into three categories. Exhibit 12.4 shows these categories in the form of a continuum based on involvement and risk.

1. Extended Decision Making When consumers engage in extended decision making, they tend to search diligently for information that will help them reach a satisfactory decision.

2. Limited Decision Making Consumers search very little for information and often reach decisions based on prior beliefs about products and their attributes.

3. Habitual (or “routine”) Decision Making Consumers generally do not seek information at all when a problem is recognized. Two topics are of special importance regarding habitual decision making: brand loyalty and brand inertia.

1 Prasad, V. Kanti (1975). “Socioeconomic Product Risk and Patronage Preferences of Retail Shoppers,” Journal of Marketing, 39 (July): 42-47; Dowling, Grahame R. and Richard Staelin (1994). “A Model of Perceived Risk and Intended Risk-Handling Activity,” Journal of Consumer Research, 21 (1): 119-134.


a. Brand loyalty may be defined as a deeply held commitment to rebuy a product or service regardless of situational influences that could lead to switching behavior.

b. Brand inertia is present when a consumer simply buys a product repeatedly without any real attachment.

Reward cards can be a successful method of rewarding loyalty if consumers value both the product and the incentives offered.

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Final Thought on Decision-Making ApproachesConsumers go through decision processes, but these decision processes do not guarantee maximum value from a consumption experience.

Q: Ask students for examples of brand products to which they are loyal and those to which they experience brand inertia.

A: Answers will vary. Students may have loyalty to Apple products, brands of cars, or clothing, such as Hollister or Bebe.

LO4. Understand the importance of the consideration set in the decision-making process.

Need Recognition, Internal Search, and the Consideration Set

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Need RecognitionThe decision-making process begins with the recognition of a need. Simply put, a need is recognized when a consumer perceives a difference between an actual state and a desired state.

An actual state is his or her perceived current state. A desired state is a perceived state for which a consumer strives. A desired state can be affected by many factors including reference group information, consumer novelty seeking, and cognitive thought processes. Consider how happy consumers once were with their cell phones—that is, before the iPhone was released. When the iPhone was introduced, the desired state for many consumers changed dramatically. Now that Apple has rolled out the iPad, consumers’ desired state for the PC has changed.

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Q: Ask students if their desired state for their computer choice changed when the iPad was introduced. Did anyone rush out to buy one?

A: Answers will vary. It would be interesting to poll the class (if there are several iPad users) to see how many will change from a laptop to the iPad.

Search BehaviorWhen consumers perceive a difference between an actual state (an empty bag of chips) and a desired state (a full bag of chips), the decision-making process is triggered. Consumers seek all types of information about potential solutions to needs, including the following:

Number of alternatives available Price of various alternatives Relevant attributes that should be considered and their importance Performance of each alternative on the attributes

Ongoing and Prepurchase SearchA consumer performs an ongoing search when he seeks information simply because he is interested in a particular topic, such as a product or organization. Consumers who perform ongoing searches are usually highly involved with the product category and seek information simply for enjoyment.

The concept of information search has changed dramatically in recent years due to the mass adoption of the Internet as well as the proliferation of mobile information technologies,


such as cell phones and personal data assistants. The problem is that there is simply too much information out there. Information overload refers to the situation in which consumers are presented with so much information they cannot assimilate it all.

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The Consideration SetA consideration set includes the brands, or alternatives, that are considered acceptable for further consideration in decision making.

An internal search includes the retrieval of knowledge about products, services, and experiences that is stored in memory. A universal set is the total collection of all possible solutions to a recognized need (e.g., the total number of brands of deodorant available on the market). An awareness set includes the set of brands or alternatives to which a consumer is aware. There are three categories of alternatives in an awareness set:

1. Consideration set (or “evoked set”) Includes the alternatives that are considered acceptable.

2. Inept set Includes those alternatives that are deemed to be unacceptable for further consideration.

3. Inert set Includes those alternatives to which consumers are indifferent or to which strong feelings are not held.

The conceptualization of a consideration set is presented in Exhibit 12.5. This demonstrates how the size of both the awareness and consideration sets is smaller than the universal set.

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LO5. Understand the factors that influence the amount of search performed by consumers.

External Search

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An external search includes the gathering of information from sources external to the consumer including friends, family, salespeople, advertising, independent research reports (such as Consumer Reports), or the Internet.

When selecting the best information sources, consumers consider the following factors: Ease of obtaining information from the source Objectivity of the source Trustworthiness of the source Speed with which the information can be obtained

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Q: Ask students about their sources of information. How many now use Facebook as a source of information? Do they consider the information on Facebook to be trustworthy?

A: Answers will vary.

The Role of Price and Quality in the Search ProcessTwo evaluative criteria are used across almost all consumer decisions: price and quality. Consumers tend to seek out information about these concepts early in the search process, and they play important roles in an external search.

Price represents an important type of information that consumers generally seek. But, what is a price? A price is really a piece of information that signals the amount of potential value contained in a product. Consumers also commonly search for information about a product’s quality and nearly always consider quality as an important evaluative criterion. Quality is the perceived overall goodness or badness of some product.

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Q: Ask students whether price or quality is more important to them when purchasing an item. Discuss when price might make more sense and when quality is a better indicator.

A: Answers will vary. Some students will not be convinced about the importance of price. A good discussion topic would be the purchase of their first suit. A suit of good quality will hold up over time and can be used for years to come.

External Search and the InternetIn today’s fast-paced information-rich environment, there is a tremendous amount of information available to us. The Internet improves consumer search activities in several ways:

Lower costs associated with the search and make the process more productive Make the search process itself enjoyable Control the information flow more efficiently than TV or radio ads

With the Internet at our fingertips, it has become a popular tool for many reasons: Search engines including Google and Bing allow you to solve problems Facebook provides the opportunity to connect with people and products worldwide


Consumers can buy from sponsored links on other sites Mobile technologies will continue to grow and consumers will be able to do even more

online

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Amount of SearchThe amount of search that a consumer performs relating to decision making can be measured in a number of ways including the number of stores visited, number of Internet sites visited, number of personal sources used (e.g., friends, family, salespeople), number of alternatives considered, and number of advertisements acknowledged. Factors influencing the amount of search performed by a consumer include the following:

Product Experience Evidence shows that moderately experienced consumers search for purchase-related information more than either experienced or inexperienced consumers. This finding is shown in Exhibit 12.6. Involvement Purchase involvement is positively associated with search activities, especially for ongoing searches. Perceived Risk As perceived risk increases, search effort increases. Value of Search Effort When the benefits received from searching exceed the associated costs, consumers derive value. Time Availability Having more time to spend on a search usually results in increased search activity. Attitude Toward Shopping Consumers who value shopping and who possess positive attitudes toward shopping generally spend more time searching for product information. Personal Factors Search tends to increase as a consumer’s level of education and income increases. Situational Influencers Situational factors also influence the amount of search that takes place. Perceived urgency, financial pressure, and mood can impact search behavior.

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Q: Which search factors are most important to students when purchasing a new laptop? Cell phone? Home?

A: Answers will vary. Because time is such a consideration for all consumers today, time availability will be on the top of the list for many students.

Search RegretThe term search regret refers to the negative emotions that come from failed search processes. Many times, consumers are simply not able to find an acceptable solution to their problem, and the decision-making process stops. In these situations, consumers may feel like the entire search process was a waste of time, and search regret will be felt.

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There are both pros and cons to the controversial method of slotting allowances. Marketers pay retailers a fee to place a new product in a specific location to draw attention to it.

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Have students discuss slotting allowances and debate the pros and cons of the use of them by marketers and retailers.

VIDEO CLIPPowerPoint Clip from Manifest DigitalRun time 1:49 minutes

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Manifest Digital is a marketing and design firm with a focus in website development. Manifest Digital focuses on making their client’s sites customer-oriented and easy to use. This company relies on user-centered principles to meet the needs of both their clients—those producing and marketing goods—as well as the website’s users—potential consumers. For Manifest Digital the end goal is providing users with a rewarding experience.

Ask your students:1. What does Manifest Digital mean when it says its philosophy is based on “user centered principles?”

Answer: User centered means making decisions focused on customers needs and providing a positive user experience. This company believes a good user experience occurs when users easily find what they are coming to the site to find, rather than focusing on high-end graphics and animation.

2. How has this philosophy contributed to the company’s success?

Answer: Manifest designs or re-designs websites around the user’s viewpoint, enabling users to experience the site at an enhanced level, while also meeting the needs of the client—to market a product, good, or service.

END OF CHAPTER MATERIAL

ONLINE CASE ANSWERS Visit www.login.cengage.com to access the online case studies for CB.


http://www.cengage.com/login

1. How does the need recognition portion of the consumer decision-making process apply to this case? What need is being addressed?

Answer: The issue in this case is “need.” Does the consumer truly “need” bottled water? Of course, consumers do need water to survive; however, many people would argue that public water systems do an adequate job of providing healthy water. As the case points out, other consumers would strongly disagree, and it is true that many older consumers do not perceive the need. The need arises largely because younger consumers are growing up in a time period that highlights healthy living. Everyone knows that life doesn’t exist without water. However, is bottled water really necessary? This is the real issue in the case.

2. What brands of bottled water are you familiar with? Do these brands easily come to mind when you think of bottled water? Explain this issue from the perspective of the consideration set. How would you describe your consideration set for bottled water?

Answer: Student responses to these questions will vary. Numerous brands of bottled water are available on the market. Some are national brands (e.g., Aquafina), while others are local (e.g., Ozarka). Many universities also market their own brands of water (e.g., Oklahoma State has H2OSU). The extent to which these brands easily come to mind measures the concept of the consideration set. Students should discuss issues related to the universal set, awareness set, and consideration set. There will likely be many brands found in student consideration sets.

3. The next time you are in the classroom, take note of how many students are drinking bottled water compared with soda. Does this surprise you? Ask a friend why he or she chooses bottled water over soda. Can you relate? Do you agree with his or her reasoning?

Answer: This is a great avenue for classroom discussion. It is quite common that college classrooms (that allow drinks) will be full of bottled water, and students should not be surprised by this fact. Students’ friends will have many opinions as to why bottled water should (or shouldn’t) be selected.

4. Go to a website that markets bottled water. Does it explain the health benefits of the product? If so, what does it claim? Why do you believe or disbelieve the information that you have found? Do you believe that the water is significantly better for you than tap water? Explain.

Answer: Students can visit numerous websites that discuss bottled water. An obvious choice would be www.cocacola.com. Another site is www.bottledwaterweb.com. Most students will likely believe in the health benefit claims of bottled water marketers and that bottled water is much better than tap water. Student responses to these questions will vary.

REVIEW QUESTIONS

(*) Indicates material on prep cards.

1. [LO1] What are the activities that comprise the consumer decision-making process?

Answer: Decision-making processes generally include five activities:


Need recognition Search for information Evaluation of alternatives Choice Postchoice evaluation

2. *[LO1] Describe how social networking sites relate to each of the steps in consumer decision making.

Answer: Student responses will vary. However, there are some general themes that should be included. Consumers realize the need for products and services by observing others. As such, they may learn about new products from social network sites. The sites obviously work very well with assisting consumers with information search. Fan pages on Facebook is a good example here. They also help give consumers input into which alternatives to choose. Group members may specifically give advice on which brands should, and shouldn’t be purchased. Group input can also directly influence the final choice. Consumers can also report back to the group his/her perceptions of the purchase after-the-fact. This information can be shared with others who may not yet have made a purchase.

3. [LO1] Why are these behaviors referred to as activities rather than steps?

Answer: The reason is that consumers do not always proceed through the activities in sequential fashion and don’t always complete the entire process.

4. [LO2] What are the three major decision-making perspectives?

Answer: The three major decision-making perspectives are the rational decision-making perspective, experiential decision-making perspective, and behavioral influence decision-making perspective.

5. [LO2] What are the differences between these perspectives?

Answer: The three perspectives differ in important ways and are similar to the attitude hierarchies discussed in Chapter 7. According to the rational decision-making perspective, consumers carefully consider their decisions and are rational in what they choose to do. According to the experiential decision-making perceptive, the decisions that are made are influenced most heavily by feelings associated with the consumption activity. From the behavioral influence decision-making perspective, decisions are really responses to environmental influences and pressures.

6. [LO3] How do extended, limited, and habitual decision making differ from each other?

Answer: When consumers engage in extended decision making, they search carefully for information that will help them reach a satisfactory decision. The process is generally rather lengthy. This process occurs most frequently when involvement is high and a significant amount of purchase risk is involved with the decision. When consumers engage in limited decision making, they usually search for very little information and often reach decisions based on prior beliefs about products and their attributes. Consumers usually make very few, if any, comparisons across brands. This type of decision making usually occurs when there are relatively low amounts of purchase risk and product involvement. With habitual


decision making, consumers often do not seek information at all, and the ultimate choice or decision is often based on habit.

7. *[LO3] What types of products are generally purchased after an extended decision-making process has occurred? What types of products are purchased after a habitual decision-making process?

Answer: There are many products that students may use as product examples. The focus is for students to realize that extended decision making is used when the product being considered includes some type of risk. Products purchased with habitual decision making are those that the consumer doesn’t generally think much about at all. Products that are usually purchased after extended decision making include big purchases such as vacation packages, appliances, or computer systems. Products that are usually purchased after habitual decision making include products such as soda, chewing gum, or breath mints.

8. [LO4] How does the consideration set influence decision making?

Answer: When consumers enter into a problem situation, they first consider those alternatives that are found in their internal memories. The consideration set plays an important role here because it includes all of those brands that are actually considered as possible solutions to problems. It is very important for marketers to ensure that their products are in the consideration set of their targeted consumers.

9. *[LO4] What are the differences between the awareness set, consideration set, inert set, and inept set?

Answer: The awareness set includes the set of brands or alternatives to which a consumer is aware. The other sets included in this question are found within the awareness set. The consideration set includes the brands or alternatives that are considered acceptable for further consideration in decision making. The inept set contains those alternatives that consumers find unacceptable as solutions. The inert set includes those alternatives to which consumers are indifferent or to which strong feelings are not held.

10. [LO5] What factors influence the amount of search a consumer performs?

Answer: Several factors influence the amount of search that a consumer performs including their experience with the product, their involvement, the perceived risk, the overall value of the search effort itself, their time availability, and their attitude toward shopping, personal factors, and situational influencers.

11. [LO5] What types of sources are generally viewed as being most valued by consumers?

Answer: Consumers usually value sources that are objective, trustworthy, and provide timely information. In addition, sources that provide information easily are generally valued more highly.

12. [LO5] How do consumers use social networking sites when searching?

Answer: Consumers frequently use social networking sites when searcing for product related information. Sites like Facebook are very useful for this purpose. By joining fan


pages, or groups, consumers are able to get the latest information available about all types of products and services.

INTERACTIVE/APPLICATION EXERCISES

13. Describe a recent consumption experience that you have had by using the concepts found in the basic consumption process framework. How did the decision-making model discussed in this chapter apply?Answer: Student responses to this question will vary greatly. The focus of the question is to prompt students to apply the decision-making concepts presented in the general framework to situations they have faced in their everyday lives. As students move through the consumption process, various decision-making activities take place. Students should discuss the problems that they’ve faced, how they searched for information, how they evaluated alternatives, and the final decision that they made. Furthermore, students should briefly discuss the way they felt after the decision (and consumption) had taken place.

14. *Visit a Facebook fan page, like Honda, for example. What types of information about the product can you find on the site? What types of topics are discussed on the site?Answer: Student responses will vary. Information obtained on these sites tend to be very useful for input into consumer decisions. Group members are usually able to help each other out with various comments and pieces of advice.

15. *Compare a number of automobile-buying websites, such as www.autobytel.com and www.carsdirect.com. What types of information are shown? What site features do you find to be most valuable?Answer: It is likely that students will be aware of more websites than the two mentioned here. The information contained on the websites is generally of the same type (makes, models, engines, warranties, serviceability); however, general website designs will likely vary greatly between the sites. Features that are valued across the websites will also vary by student. Chances are that students will value the overall information content of the websites and the ease with which they can find information.

16. Find a source of college ranking information, such as U.S. News and World Reports: America’s Best Colleges or Princeton Review’s Best 361 Colleges. What types of information is given about colleges? Which information do think is most valuable to a student who is trying to select a college?Answer: Most reports will contain some predictable information such as overall enrollment, entrance requirements, faculty-to-student ratios, demographic profiles of students, and year the school was founded. As for the most valuable type of information, these results will likely be interesting. Most students will have recently made a decision as to which college to choose, and there will likely be variance in the responses given for this part of the question.

17. Think of a recent purchase that you believe included a significant amount of risk for you. What type(s) of risk were involved? How did you attempt to minimize risk? (If you did not attempt to minimize your risk, explain your thinking.)


Answer: Many different examples may surface with this question. Students may discuss how they chose the college, how they recently purchased a car or computer, how they selected a computer, or how they chose a fraternity/sorority. Many types of risks will be involved, from monetary risks to social risks. Students may have sought to minimize these risks as much as possible by searching for external information, asking friends or family members what they should do, or taking considerable time in making the decision. Student responses are likely to vary.

18. Think of a few brands of products to which you consider yourself loyal. Why are you loyal to these brands?

Answer: This is always an interesting question for class discussion. Students may discuss brands of cereal, beer, and cigarettes or types of cars. There will be many reasons for the loyalty that they express. It is common that family influences play a big role in student loyalty toward products. For example, it’s not uncommon to hear students say that their entire family is made up of “Chevy people.”

GROUP ACTIVITY

Have groups of 23 students work together on this activity, or it can be completed on an individual basis. Instruct students to collect 10 magazine ads that represent products that they use on a regular basis (the instructor may choose to bring in a handful of magazines). Then have students divide into teams (number of students is not a critical factor) to complete a top-10 product list.

Once the list is complete, each student should select two items on the list and locate an advertisement or promotion for each of the selected products. The two advertisements or promotions then serve as the medium for a discussion. For the discussion, analysis of the each advertisement is broken down into three sections.

1. Students must identify 46 consumer behavior concepts used in the advertisements.2. Ask students to identify and explain the demographic and psychographic segments to

which the ad was designed to appeal.3. Students should explain whether they fit into the identified target market.

CHAPTER VIDEO CASE

To view the video case Consumer Behavior at Scholfield Honda, go to the CB companion website login.cengage.com to select this video.2

If you want to study consumer behavior, probably the best place to start would be a car dealership. Cars are a big investment. Most people spend upwards of $20,000 on a new car and $6,000 or more on a pre-owned vehicle. In the United States, where we drive pretty much everywhere, your car is your first contact with the world. One look at someone’s car and you might get an idea of their politics, bank account, occupation, education, musical tastes, and

2 From Boone & Kurtz. Consumer Behavior at Scholfield Honda from Contemporary Marketing 14e, pg. VC-6. Copyright (c) 2010 South-Western, a part of Cengage Learning, Inc. Reproduced by permission. www.cengage.com/permissions


favorite weekend activities. It’s the ultimate fashion accessory. Does it have a lot of cup holders and a DVD player in the headrest? Family car. Cute little convertible? Twenty-five-year old with her first real job. That Italian sports car? Retail therapy for the mid-life crisis. That person in the 2009 Honda Fit hybrid who just stole your parking space? Likely some smug, twentysomething activist.

But looks can be deceiving. When the Honda Insight, Honda’s first consumer hybrid car, hit the market in 2000, Roger Scholfield, owner of Scholfield Honda in Wichita, Kansas, thought he had it all figured out. For one thing, Wichita isn’t exactly known as the epicenter of eco-consumerism. He’d probably sell a handful of the hybrid cars to a couple of single, twentysomethings. The car only had two seats and seemed pretty flimsy with its lightweight aluminum body. And with a sticker price of $20,000, it was pretty pricey.

The first Insight he sold went to a 63-year-old.The second person to buy one was 65.As it turns out, Roger’s experience was consistent with Honda’s market research. They

determined that the typical Insight customer was older, highly educated, probably with an engineering or science background—a person who tended to be very research-driven.

Vinnie Koc, a sales consultant at Scholfield Honda, relies more on his experience than the data to sell cars. “The vehicle pretty much sells itself,” says Vinnie. “Most of my customers are previous owners or someone in their family owns a Honda that wants them to buy a Honda.” Vinnie’s customers don’t just show up and hop in the first car they see. Most of them have spent time on the Scholfield and Honda websites, researching and comparing models before they come in. They know what they want, are unlikely to be upsold on additional bells and whistles, and are clear on how much they are willing to pay. “Our job is to present the vehicle,” says Vinnie. It usually takes a few test drives to complete the sale, but he is patient. It is all part of Scholfield Honda’s low-pressure environment.

“I love my Scholfield Honda” is the tagline on many of the dealership’s television and radio ads. “The Scholfield reputation is 100 percent why the customers are here,” says Koc. In a market where the anonymous experience of shopping online is the norm for so many consumers, providing opportunities for customers to feel special and paid attention to can really make a difference, especially in car sales, an industry where trust so often is lacking. Owner and general manager Roger Scholfield takes the time to meet with customers, and consultants like Vinnie take the time to follow up on every meeting—from test drive to final sale. “If they see that you are able to provide the information they need, they feel comfortable with you and that makes them happy.” It is not unusual for Vinnie’s customers to drop by on their lunch hour just to say “thanks” and gush about how much they are enjoying their new Honda.

Ask your students:

1. Name the top influence(s) impacting a consumer’s decision to buy a car from Scholfield Honda.

Answer: According to the video, the following factors influence customer purchases at Scholfield Honda: positive recommendations from friends and family members, prior ownership of Honda vehicles, desire to drive more environmentally friendly cars, Honda’s reputation for quality and fuel efficiency, the dealership’s friendly sales associates and clean showroom environment.


2. Go to www.honda.com and view the different Hondas to select the car you would be most likely to purchase.

Answer: Students’ answers will vary. However, students should be able to assess their own needs and motives for selecting a vehicle. Additionally, they should be able to associate their buyer motives with various interpersonal determinants of consumer behavior (cultural, social, and family influences) and personal determinants of consumer behavior (needs and motives, perception, attitudes, learning, and self-concept) as discussed in the text.

3. Lee Lindquist says that customers evaluate certain trade-offs when they consider whether or not to buy a hybrid vehicle. What are those trade-offs, and what decision would you make in that situation? Explain.

Answer: Lee Lindquist says that consumers who shop for hybrid vehicles must weigh the high cost of hybrids against their unique features, such as superior gas mileage and intangible “green” benefits. Student answers will vary on what choice they would make in that situation and why.

4. Is buying a car a high-involvement purchase decision or a low-involvement purchase decision? Does car shopping typically require limited problem solving or extended problem solving? Explain.

Answer: Purchases decisions that have a high level of social or economic consequences are said to be high-involvement purchase decisions—buying a car qualifies as a high-involvement purchase decision. Car shopping also requires extended problem solving.


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331 consumer... · Web viewL01 Understand the activities involved in the consumer decision-making process. L02 Describe the three major decision-making research perspectives. L03