ISL460U-CONSUMER BEHAVIOR
Chapter 4: Consumer as a Learner and Decision Maker
Learning
How consumers learn and how they keep the things they have learned matters to discuss in terms of consumers’ information processing and experiences shape their purchasing behavior.
Consumer Learning
For learning to occur, a consumer may observe others’ behavior. This is called observational (social) learning. This may occur effortlessly or accidentally due to advertisements and marketing communication. This is called incidental learning. Learning creates a positive or negative change in behavior.
Learning Theories
Behavioral Learning
There are two important concepts central to behavioral learning which are classical conditioning and operant conditioning.
Classical Conditioning and Marketing Applications
Repetition: The process should be repeated in the long term to maintain the association between the unconditional stimulus and the conditional stimulus.
Stimulus Generalization: Stimulus generalization is defined as the response to a stimulus similar to the conditioned stimulus.
Stimulus Discrimination: Stimulus discrimination is the opposite of stimulus generalization. discrimination is the opposite of stimulus generalization.
Operant Conditioning and Marketing Applications
Operant conditioning has three principles.
Positive Reinforcement: It is the reward that consumers receive as a result of their behaviour and is an important factor in reinforcing the learned behavior.
Punishment: The difference between punishment and negative reinforcement is that for the former, the consumer must perform the behavior to learn.
Observational Learning
Observational learning regards consumers’ choosing or shaping a behavioral style by observing other people’s behavior. Moreover, while marketers prefer celebrities and respected people in advertisements, they try to ensure that consumers model them.
Cognitive Learning
Cognitive learning is a learning theory that encourages people to engage in mental activities to overcome problems. As cognitive learning involves information processing, the center of information processing is memory.
Memory
Memory is fundamentally important for cognitive learning and consists of the faculty of the brain where the information is coded, stored, and retrieved when needed.
Sensory Memory: It consists of information experienced by the senses. It is a temporary memory and lasts up to a few seconds.
Short-term memory also stores information for a limited time and has limited capacity and known as working memory, is the section that processes and makes sense of temporarily stored information.
Long-term memory: is a memory that allows the storage of information over an extended period. Information recall is the process of returning the stored information from long- term storage to short-term or working memory.
Consumer Decision Making
There are various factors that affect consumer buying decisions, and a five-stage buying decision process covers these factors within a framework of cognitive assessment.
Problem Recognition occurs whenever consumers see the difference between an actual state.
Need recognition occurs when consumers realize that a product they use and need is running out or decreasing, or the existing product is too old to meet their needs.
Opportunity recognition: When consumers recognize the existence of a product that will meet their buying need better and develop a desire to purchase that product, it causes problems.
Active and inactive problems: Problems that arise from consumers’ self-realization of the need are defined as active problems while the needs that consumers are not yet aware of are defined as inactive problems.
Internal and External Search: For internal search, consumers identify prior experience with a product from their memory. Internal search alone is more likely to be sufficient for routine purchases.
Information Sources: Consumers’ information sources for internal and external search before purchasing are:
1. Memories 2. Personal sources 3. Independent sources 4. Marketing sources. 5. Experiential sources
Factors Affecting Research Level: The factors affecting the research level of consumers are categorized under three main factors;
1. product-related factors, 2. consumer-related factors, and 3. situational factors.
Types of information to research:
1. Evaluative criteria: The information about product attributes will solve the consumers’ problems. 2. Evaluation of alternatives: Once consumers determine the evaluative criteria, they begin to seek information to identify and evaluate alternative products for the solution of their problems. 3. Alternative features: In this process, the consumer collects detailed information about each brand using the evaluative criteria to select one of the brands in the evoked set.
Types of evaluation: They generally follow one of the three selection processes. These are affective choice, attitude-based choice, and attribute-based choice
Noncompensatory Decision Rules: Consumers evaluate each option and choose a brand with the highest performance based on their criteria.
Online Retails vs. Store-Based Retails: The factors affecting consumers’ online retail preferences can be listed as follows:
• Usefulness • Enjoyment • Ease of use • Trustworthiness • Style • Familiarity • Fast and flexible delivery and transactions
Furthermore, for consumers who prefer to shop from store-based retail, the reasons are
1. Breaking the monotony and having fun, 2. Information seeking about new products and brands, and following the fashion trends, 3. Physical activity 4. Opportunity to experience and interact outside home 5. Being able to negotiate price.
Store Features: Store image consists of consumers’ perception of store features. Advertising, physical proximity to a store, the comfort of their experience, and the store size.
In-store experience: A store’s physical appearance, knowledge level of sales personnel, product variety, trendiness, quality, and price are also in-store factors that affect store preference.
Determinants of Satisfaction: Product performance is evaluated in two categories: instrumental and symbolic (expressive) performance.
Types of Consumer Decision Making
Individuals show differences in their decision-making processes based on their experiences and knowledge about the qualities of products and services they wish to purchase.
There are three types of cognitive purchase: Limited problem solving, Extensive problem solving, and Routinised choice.
Limited Problem Solving In this form of purchase, consumers do not need extensive research and evaluation before purchasing a product. It applies to frequent purchases.
Extensive Problem Solving This type of purchasing requires a conscious and systematic effort. Extensive problem solving is a purchasing behavior commonly observed with infrequently purchased items carrying higher risks to buyers (such as cars, computers, or houses).
Routinized Choice Behavior This is the type of purchasing decision where consumers do very limited internal research and the decision process involves little conscious effort.
Extensive Problem Solving is used generally for infrequent purchases.
Routinized Choice Behavior is a typical form of frequent purchases.
Impulse (Unplanned) Purchase is defined as an unplanned purchasing, often accompanied by intense feeling states such as pleasure and excitement with a sudden urge.