Decision making part 2 (Decision models)
In order to choose a brand or product among several alternatives, consumers will apply decision rules (models) to evaluate brands and use (or not) very simple or more complex decision rules. In general, as decisions are usually very demanding in terms of cognitive work, consumers will have a tendency to simplify their decision process by using short cuts instead of processing all the available information. These decision rules (shortcuts) are called heuristic. They are a very important components of the decision making process in consumer behavior and each of these decision rules will be described hereafter.
We all use common heuristic without even ...view middle of the document...
To calculate the score of each brand, each attribute is evaluated (from 1: Poor to 4: excellent) and is attributed a weigh depending on its importance when making the decision. These features are taken into account by calculating a weighted sum for each alternative. For instance, Brand 1 has an average quality (2) but quality is a very important attribute (4) so its weighted score is 8 on quality (4 * 2). This calculation is done for each attribute for a given brand to reach a final weighted score (For Brand 1: 24). The brand with the highest score is chosen (Brand 2) and in this model bad features can be compensated by positive features, particularly if important for the consumers. The relative comparisons of brands help to make a choice even if it requires high cognitive work.
Discussion question: Describe the latest important purchase you have made using a compensatory approach.
Non Compensatory Model
Four (4) types of non compensatory models are detailed below. In all cases, the consumer considering making a purchase (a stereo) has collected information on the brands available on the market and the attributes he considers before buying the product. This table of information is presented below:
With the same information, this consumer may however make different choices depending on the decision rule he chooses to apply. Here are four non compensatory rules.
* Conjunctive Model (also called the AND model)
Using this heuristic, consumers set minimum standards (characteristic) that a brand should have on each attribute they consider when purchasing the product. The chosen brand should surpass this minimum standard on ALL attributes considered (AND rule). In the case below, the chosen brand should have:
Applying this rule, the only brand that fulfills all this criteria in the table of information is RCA and this brand will be chosen. If no brand had fulfilled ALL these criteria, no brand would have been chosen using this rule. If more than one brand would have satisfied all the criteria, consumers would have retained these brands and apply another rule to come up with only one choice.