In what ways do consumers stray from a deliberative,rational decision process?

Elaboration Likelihood Model

Peripheral routeAttitude formation or change provokes much less thought and results from the consumer’s association of a brand with either positive or negative peripheral cues.

Central routeAttitude formation or change stimulates much thought and is based on consumer’s diligent,rational consideration of the most important product information

Variety-Seeking buying behaviour

Some buying situations are characterised by low involvement but significant brand difference,here consumer do a lot of brand switching.Brand switching occurs for the sake of variety,rather than dissatisfaction

Behaviour Decision Theory

Decision Heuristics

Availability Heuristics

Representativeness Heuristics

Anchoring and adjustment Heuristics

Availability Heuristics

Consumer base their prediction on the quickness and ease with which a particular example of an outcome comes to mind.for examplea recent product failure may lead a customer to inflate the likelihood of a future product failure

Representativeness Heuristics

Consumers base their prediction on how representative or similar the outcome is to other examples.

For exampleSimilar package appearance of different brands

Anchoring and adjustment Heuristics

Consumer arrives at an initial judgement and then adjust it based on additional information

Decision Farming

Decision farming is the manner in which choices are presented to and seen by a decision maker.

for exampleA Rs 20,000 cell phone may not seem expensive in the context of a set of Rs 40,000 phone but will seem expensive if those phone cost Rs 5000

Mental Accounting

It refers to the way consumers code,categorize and evaluate financial outcomes of choices.

Consumer tend to integrate losses

Consumer tend to segregate gains

Consumer tend to segregate small gains from large losses

Consumer tend to integrate smaller losses with larger gains

Mental accounting is based on a set of core principles

Thank You

Created by Rishabh Salgia,IIT Bombay,during an internship by Prof.Sameer Mathur,IIM Lucknow

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