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Decision Making
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Decision
A decision is the selection of an option from
two or more alternative choices.
Brand Decisions
Quantity Decisions
Purchase Channel
Payment Option
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Level of Consumer Decision Making Extensive Problem Solving
No established Criteria for evaluating product
No initial brand preference
Require great deal of Information to establish Judgment
Criteria.
Limited Problem Solving
Basic criteria for evaluation are already established
Search for additional information before making final decision
Routine Response Behavior
Routine Purchases
Criteria and Preferences are well set
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Views towards Consumer Decision
Making
How and why Individuals behave as they do.
1. Economic View
2. Passive View
3. Cognitive View
4. Emotional View
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Economic View
Rational Decisions
Awareness of all available alternatives
Ranking of each alternative
Identifying the Best Alternative
Passive View Impulsive or Irrational Consumers
Influenced by the Promotional efforts of theMarketers
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Cognitive View Focussed Evaluation of Information
High degree of Information Processing
Emotional View
Consumers decision is affected strongly by
emotions such as Joy, Fear, Love, Hope etc.
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Model of Consumer Decision Making
Input Process Output
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Firms Marketing EffortsProduct
Promotion
Price
Place
Socio-Cultural EnvironmentFamily
Informal Sources
Social Class
Culture & Subculture
Input
External
Influences
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Need Recognition
Information Search
Evaluation of Alternatives
Process
Motivation
PerceptionPersonality
Learning
Attitudes
Consumer Decision Making
Internal
Influences
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Information Search Market Source
Customer Source
Neutral Source
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Purchase Post Purchase Evaluation
Output
Post Decision Behavior
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Post Purchase
Cognitive dissonance, Attribution
Repeat Purchase
Dispose
Exchange, destroy, gift, donate, sell, recycle etc.
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Decision Rules Non Compensatory Decision Rules
Decision rule is said to be Non Compensatory whengood performance on one evaluative criterion does notcompensate for poor performance on another evaluativecriterion of the brand.
Disjunctive Rule:
Consumer selects the most important evaluativecriterion
Minimum acceptable performance standard isestablished for that criterion which that brand must meet
The brand that exceeds the minimum performancestandard on that criterion will be accepted
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Conjunctive Rule: Requires consumer to establish minimum levels of
acceptability on each brand attribute that is of relevant tothe consumer
The brand will be selected if all the selected attributemeets the minimum performance standard
Lexicographic RuleAn extension of disjunctive decision rule Ranking of attributes from most important to least
important If choice cant be made by the most important criterion
(in case of a tie between two brands), the next bestcriterion will be assessed
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Compensatory Decision Rule The brand strengths compensates for brand
weaknesses
The positive attributes are given more importance
Decision on overall rating