2

Decision Making

CONSUMER
BEHAVIOR, 11e
Michael R. Solomon

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 Chapter Objectives
1. The three categories of consumer
decision-making are cognitive, habitual,
and affective.
2. A cognitive purchase decision is the
outcome of a series of stages that results
in the selection of one product over
competing options.

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 Learning Objective 1
• The three categories of consumer
decision-making are cognitive, habitual,
and affective.

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 Figure 2.1 Three Types of
Decision-Making

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 Conceptualizing Involvement
• Before we explore the three types of decision-
making, we need to first ask why different
consumers may approach the same choice
situation from very different perspectives.
• One reason is the consumer’s level of
involvement in the decision.
• Involvement is a person’s perceived relevance
of the object based on their inherent needs,
values, and interests.

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 Figure 2.2 Conceptualizing Involvement

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 Table 2.1 A Scale to
Measure Involvement

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 Types of Involvement

Product

Message

Situational

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 Types of Involvement
• Product involvement is a consumer’s level of interest in a
particular product. As a rule, product decisions are likely
to be highly involving if the consumer believes there is
perceived risk.
• Message involvement refers to the influence media
vehicles have on the consumers. Print is a high-
involvement medium while television tends to be
considered a low-involvement medium.
• Situational involvement takes place with a store, website,
or a location where people consume a product or
service. One way to increase this kind of involvement is
to personalize the messages shoppers receive at the
time of purchase.
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 Minolta Understands Perceived Risk

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 Five Types of Perceived Risk

Monetary risk

Functional risk

Physical risk

Social risk

Psychological risk

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 Five Types of Perceived Risk
• Monetary risk occurs when making a poor choice will
have a monetary consequence.
• Functional risk is the risk that the product may not
function as the consumer needs.
• Physical risk is the risk that the choice may physically
threaten the consumer.
• Social risk is the risk that the choice will reflect poorly
on the consumer and damage his or her self-esteem or
confidence.
• Psychological risk is the risk that one may lose self-
respect due to making a bad decision. Such as
consumer to feel extensive guilt.
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 Figure 2.4 Five Types of Perceived Risk

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 Learning Objective 2
• A cognitive purchase decision is the
outcome of a series of stages that results
in the selection of one product over
competing options.

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 Steps in the Decision-Making Process

Problem recognition

Information search

Evaluation of alternatives

Product choice

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• Problem recognition occurs when we experience
a significant difference between the current state
of affairs and some state we desire.
• Information search is the process by which we
survey the environment for data to make a
reasonable decision.
• In the third stage, the consumer evaluates the
alternatives.
• Then a choice is made. The choice may be from
among product choices as well as to buy or not.
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 Figure 2.5 Stages in
Consumer Decision Making

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 Stage 1: Problem Recognition
• Occurs when consumer sees difference
between current state and ideal state
• Need recognition: actual state declines
• Opportunity recognition: ideal state
moves upward

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 Stage 2: Information Search
• The process by which we survey the
environment for appropriate data to make
a reasonable decision
• Prepurchase or ongoing search
• Internal or external search
• Online search and cybermediaries

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 Stage 3 :Evaluation of Alternatives

Evoked Set - An evoked set is the set of product choices that you
believe are viable options for you to purchase based upon your
needs and desires relating to the product.

Consideration Set - Consideration set is the subset of brands that

consumers evaluate when making a purchase decision. A consumer
has a limited information processing abilities and limits the
comparison to a subset of brands that is termed as consideration
set.

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 Stage 3 :Evaluation of Alternatives
Figure 2.8 Levels of Abstraction

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 Stage 4 : Product choice

• Now that the consumer has evaluated the

different solutions and products available
for respond to his need, he will be able to
choose the product or brand that seems
most appropriate to his needs.
• Then proceed to the actual purchase itself.

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 For Review
1. The three categories of consumer
decision-making are cognitive, habitual,
and affective.
2. A cognitive purchase decision is the
outcome of a series of stages that results
in the selection of one product over
competing options.

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 Tutorial 2
1. Discuss the THREE (3) types of decision
making.
2. Briefly explain the factors and outcomes
of level of involvement in the decision.
3. Describe the FIVE (5) types of perceived
risk with relevant example.
4. Explain the FOUR (4) steps of decision
making process with examples.

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