7/15/2021

CHAPTER 14
CONSUMER DECISION
PROCESS AND PROBLEM
RECOGNITION
THU NGUYEN

LEARNING OBJECTIVES

1. Describe the impact of purchase involvement on the decision

process
2. Explain problem recognition and how it fits into the consumer
decision process
3. Summarize the uncontrollable determinants of problem
recognition
4. Discuss the role of consumer problems and problem recognition in
marketing strategy

1
 7/15/2021

TYPES OF CONSUMER DECISIONS

• The term consumer decision produces an image of an individual
carefully evaluating the attributes of a set of products, brands, or
services and rationally selecting the one that solves a clearly
recognized need for the least cost.
• Many consumer decisions focus not on brand attributes but rather
on the feelings or emotions associated with acquiring or using the
brand or with the situation in which the product is purchased or
used.
• The types of decision processes are not distinct but rather blend
into each other.

TYPES OF CONSUMER DECISIONS (CONT.)

• Purchase involvement is the level of concern for, or interest in, the
purchase process, triggered by need to consider a particular purchase,
and so it is a temporary state influenced by the interaction of individual,
product, and situational characteristics.

• Purchase involvement is not the same as product involvement or enduring

involvement. A consumer may be very involved with a brand (Starbucks or
Dodge) or a product category (coffee or cars) and yet have a very low
level of involvement with a particular purchase of that product because of
brand loyalty, time pressures, or other reasons.

2
 7/15/2021

TYPES OF
CONSUMER
DECISIONS
(CONT.)

TYPES OF CONSUMER DECISIONS (CONT.)

1. Nominal Decision Making: referred to as habitual decision making, in effect
involves no decision per se

• Nominal decisions occur when there is very low involvement with the
purchase.

• A completely nominal decision does not even include consideration of the “do
not purchase” alternative.
• Brand Loyal Purchases

• Repeat Purchases

3
 7/15/2021

TYPES OF CONSUMER DECISIONS (CONT.)

2. Limited Decision Making: involves internal and limited external search, few
alternatives, simple decision rules on a few attributes, and little postpurchase
evaluation
• It covers the middle ground between nominal decision making and extended
decision making.
• In its simplest form (lowest level of purchase involvement), limited decision
making is similar to nominal decision making.
• Limited decision making also occurs in response to some emotional or
situational needs.
• Limited decision making involves recognizing a problem for which there are
several possible solutions.
• A few alternatives are evaluated on a few dimensions using simple selection
rules. The purchase and use of the product are given very little evaluation
afterward, unless there is a service problem or product failure.

TYPES OF CONSUMER DECISIONS (CONT.)

3. Extended Decision Making: involves an extensive internal and external
information search followed by a complex evaluation of multiple alternatives
and significant postpurchase evaluation.

• It is the response to a high level of purchase involvement.

• Even decisions that are heavily emotional may involve substantial cognitive
effort.

4
 7/15/2021

THE PROCESS
OF PROBLEM
RECOGNITION

THE PROCESS OF PROBLEM RECOGNITION (CONT.)

1. Problem recognition is the first stage in the consumer decision process
• Problem recognition is the result of a discrepancy between a desired state and an
actual state that is sufficient to arouse and activate the decision process
o An actual state is the way an individual perceives his or her feelings and situation to
be at the present time.
o A desired state is the way an individual wants to feel or be at the present time.
• The kind of action taken by consumers in response to a recognized problem relates
directly to the problem’s importance to the consumer, the situation, and the
dissatisfaction or inconvenience created by the problem.
• Without recognition of a problem, there is no need for a decision
• When there is a discrepancy between a consumer desire and the perceived actual
state, recognition of a problem occurs.
• Perceptions of the actual state are also determined by a consumer’s lifestyle and
current situation.
• It is the consumer’s perception of the actual state that drives problem recognition, not
some objective reality

10

10

5
 7/15/2021

THE PROCESS OF PROBLEM RECOGNITION (CONT.)

1. Problem recognition (cont.):
o The Desire to Resolve Recognized Problems:
✓ The level of one’s desire to resolve a particular problem depends on two
factors: (1) the magnitude of the discrepancy between the desired and actual
states and (2) the relative importance of the problem
✓ A large discrepancy may exist and the consumer may not proceed to
information search because the relative importance of the problem is small

11

11

THE PROCESS OF PROBLEM RECOGNITION (CONT.)

2. Types of Consumer Problems:
o An active problem is one the consumer is aware of or will become aware of in the
normal course of events.
✓ Active problems require the marketer only to convince consumers that its brand
is the superior solution. Consumers are already aware of the problem.
o An inactive problem is one of which the consumer is not aware
✓ Inactive problems require the marketer to convince consumers that they have
the problem AND that the marketer’s brand is a superior solution to the
problem.

12

12

6
 7/15/2021

THE PROCESS OF PROBLEM RECOGNITION (CONT.)

3. Uncontrollable determinants of problem recognition

13

13

MARKETING STRATEGY AND PROBLEM RECOGNITION

• Marketing managers have four concerns related to problem recognition:
1. Discovering Consumer Problems:
• Identifying Consumer Problems Using Online and Social Media
• Monitoring and tracking is not enough
• Problems need to be solved in a timely and appropriate manner
• Surveys and focus groups use one of the following approaches to problem
identification:
1. Activity Analysis Focuses on a particular activity to determine what
problems consumers encounter during the
performance of the activity.
2. Product Analysis Examines the purchase or use of a particular
product or brand. Consumers may be asked about
problems associated with using a product or brand.
3. Problem Analysis Starts with a problem and asks which activities,
products, or brand are associated with (or perhaps
could eliminate) those problems.

14

14

7
 7/15/2021

MARKETING STRATEGY AND PROBLEM RECOGNITION

(CONT.)
1. Discovering Consumer Problems (cont.):
4. Human Factors Research
• Human factors research attempts to determine human capabilities in
areas such as vision, strength, response time, flexibility, and fatigue and
the effect on these capabilities of lighting, temperature, and sound.
o Observational techniques such as slow-motion and time-lapse
photography, video recording, and event recorders are particularly
useful methods.
o This type of research can sometimes identify functional problems that
consumers are unaware of.

15

15

MARKETING STRATEGY AND PROBLEM RECOGNITION

(CONT.)
1. Discovering Consumer Problems (cont.):
5. Emotion Research
• Marketers are increasingly conducting research on the role of emotions in
problem recognition and resolution.
o Common approaches are surveys, focus group research and
personal interviews that examine the emotions associate with certain
problems.
o Critical in helping marketers anticipate consumer reaction to
problems and train customer service personnel to respond
appropriately.

16

16

8
 7/15/2021

MARKETING STRATEGY AND PROBLEM RECOGNITION

2. Responding to Consumer Problems:

• Once a consumer problem is identified, the manager may structure the marketing
mix to solve the problem.
• This can involve developing a new product or altering an existing one, modifying
channels of distribution, changing pricing policy, or revising advertising strategy

17

17

MARKETING STRATEGY AND PROBLEM RECOGNITION

3. Helping Consumers Recognize Problems:

Generic problem recognition Selective problem recognition

• Involves a discrepancy that a
variety of brands within a product
category can reduce
• Increasing generic problem
recognition generally results in an
expansion of the total market
• Involves a discrepancy only one
brand can solve
• Firms attempt to cause selective
problem recognition to gain or
maintain market share

18

18

9
 7/15/2021

MARKETING STRATEGY AND PROBLEM RECOGNITION

(CONT.)
3. Helping Consumers Recognize Problems (cont.):
• Approaches to Activating Problem Recognition:
o Recall that problem recognition is a function of the (1) importance and (2)
magnitude of a discrepancy between the desired state and an existing state
→ a firm can attempt to influence the size of the discrepancy by altering
the desired state or perceptions of the existing state
→ the firm can attempt to influence perceptions of the importance of an
existing discrepancy.
o Many marketing efforts attempt to influence the desired state
• The Timing of Problem Recognition: consumers often recognize problems at
times when purchasing a solution is difficult or impossible

19

19

MARKETING STRATEGY AND PROBLEM RECOGNITION

(CONT.)
4. Suppressing Problem Recognition:
• Occasionally information is introduced in the market place that triggers problem
recognition that some marketers prefer to avoid.

➢ Obviously marketers do not want their current customers to recognize

problems with their brands.

➢ Effective quality control and distribution (limited out-of-stock situations) are

important in this effort.

➢ Packages and package inserts that assure the consumer of the wisdom of
their purchase are also common.

20

20

10
 7/15/2021

SUMMARY

• LO1: Describe the impact of purchase involvement

on the decision process
1. Nominal Decision Making: referred to as habitual
decision making, in effect involves no decision per se
2. Limited Decision Making: involves internal and
limited external search, few alternatives, simple
decision rules on a few attributes, and little
postpurchase evaluation
3. Extended Decision Making: involves an extensive
internal and external information search followed by
a complex evaluation of multiple alternatives and
significant postpurchase evaluation.

21

21

SUMMARY
• LO2: Explain problem recognition and how it fits into the consumer
decision process
o Problem recognition involves the existence of a discrepancy between the
consumer’s desired state (what the consumer would like) and the actual
state (what the consumer perceives as already existing).
o Both the desired state and the actual state are influenced by the
consumer’s lifestyle and current situation. If the discrepancy between
these two states is sufficiently large and important, the consumer will begin
to search for a solution to the problem.

22

22

11
 7/15/2021

SUMMARY
• LO3: Summarize the uncontrollable determinants of problem recognition

23

23

SUMMARY
• PROBLEM RECOGNITION: SHIFTS IN ACTUAL OR IDEAL STATES

Ideal state

Ideal state
Ideal state

Actual state Actual state

Actual state
OPPORTUNITY NEED
RECOGNITION RECOGNITION

Solomon (2020, p.326)

24

24

12
 7/15/2021

SUMMARY
• LO4: Discuss the role of consumer problems and problem recognition in marketing
strategy
o Before marketing managers can respond to problem recognition generated by outside
factors, they must be able to identify consumer problems
o Once managers are aware of problem recognition patterns among their target market, they
can react by designing the marketing mix to solve the recognized problem.
o Marketing managers often want to influence problem recognition rather than react to it. They
may desire to generate generic problem recognition, a discrepancy that a variety of brands
within a product category can reduce, or to induce selective problem recognition, a
discrepancy that only one brand in the product category can solve.
o Attempts to activate problem recognition generally do so by focusing on the desired state.
However, attempts to make consumers aware of negative aspects of the existing state are
also common. In addition, marketers attempt to influence the timing of problem recognition
by making consumers aware of potential problems before they arise.
o Finally, managers may attempt to minimize or suppress problem recognition by current
users of their brands.

25

25

DISCUSSION QUESTIONS
1. Interview 3 students and identify 3 consumer problems they have recognized
recently. For each problem, determine
a. The relative importance of the problem.
b. How the problem occurred.
c. What caused the problem (i.e., change in desired or actual states).
d. What action they have taken.
e. What action is planned to resolve each problem.
2. Describe a purchase you have made using nominal decision making, one using
limited decision making, and one using extended decision making. What
caused you to use each type of decision process?

26

26

13