Chapter-15: Problem Recognition
Types of
Consumer Decisions:
There are a
myriad of decision options possible for the consumer in today’s market economy.
These options, however, may be distilled into five main types of decisions:
(i) What
to buy: Deciding what to buy is one of the consumer’s most basic tasks.
No buying activity may take place unless this fundamental decision is made. A
consumer’s product or service decision may encompass not only the generic
category of products desired, such as appliances, but more specifically, the
narrower range of items, such as kitchen appliances. Consumer must even make
decision on brands, price, and product features.
(ii) How
much to buy: A second basic decision by the consumer relates to how
much of the item will be purchased. For example, when shopping for groceries
the consumer must determine whether three litters of coke will be purchased or
more.
(iii)
Where to buy: The consumer needs to decide where the selected product
or service will be purchased. This is very important decision, which interacts
thoroughly with the previous decision on what to buy. Two products, although
physically the same, are likely to perceived differently because of other facts
associated with them. For example, consider an air conditioner sold with
delivery, installation, and in-home servicing guaranteed by a full-service
department store compared with the same model priced lower.
(iv) When
to buy: The consumer must also determine when to buy. This decision is
influenced by such factors as urgency of the need and availability of the
chosen item. Other elements such as store opening times, periods of sales and
clearances, availability of transportation, and freedom of family members to
shop all the bearing on when one purchase.
(v) How to
buy: The decision of how to buy is another complex issue. Many factors
influence how the consumer buys. To indicate merely a few of the elements
involved, consider some alternative strategies consumers use: shop extensively
or buy for the first layout, pay cash or charge it, have it delivered or take
it home.
Numerous
purchasing patterns occur in the marketplace, with each consumer relying on
whatever strategy seems to work well for himself. The problems that consumers
must solve, however, could benefit from the cold logic of a computer rather
than the hit or miss decision approach taken by some consumers.
Introduction
to the Consumer Decision-Process Model:
Consumer
decision processes vary considerably in their complexity. Most of the decisions
consumers are required to make are probability rather simple ones such as the
purchase of staple foods. However, consumers also must make decisions that are
comparatively complicated, such as when buying durable goods. The range of
difficulty of consumer decision processed extends even further to problem
solving that may be characterized as being highly complex. The range of
consumer problem solving approaches can be placed on a spectrum from routine
problem solving, to limited problem solving, to extensive problem solving.
(i)
Routine Problem Solving (RPS): When consumers buy a brand they have
purchased before, it usually involves little or no information seeking and is
performed quickly. Consumers are brand loyal and tend to buy in a habitual,
automatic, and unthinking way.
(ii)
Limited Problem Solving (LPS): When consumers buy a new brand in a
familiar product category, it usually involves a moderate amount of information
seeking and time in choosing.
(iii)
Extensive Problem Solving (EPS): When consumers buy in an unfamiliar
product category, it usually involves the need to obtain substantial
information and a longer time to choose. They must form a concept of the new
product category and determine the criteria to be used in choosing a brand.
However, it has
been suggested from certain purchase situations some consumers do not engage in
a pre-purchase decision process. For example, they may not have stored
information, it may not be retrieved or retrievable, and they may not search
externally.
Problem
Recognition:
Problem recognition
results when a consumer recognizes a difference of sufficient magnitude between
what is perceived as the desired state of affairs and what is the actual state
of affairs, enough to arouse and activate the decision process. The actual
state refers to the way in which a need id already being met and the desired
state is the way a person like for the need to be satisfied.
Consumers must
become aware of the problem or need through processing of information arising
internally or externally. They then become motivated. The process of problem
recognition means that the consumer becomes aroused and activated to engage in
some purposeful purchase-decision activity.
Types of
Problem Recognition: Rather than viewing problem recognitions occurring
in only one way, it is useful to understand that there may be varying types of
problem–recognition processes. One approach has been to develop a
classification system of situations based on the factors of immediacy or
required solution and whether or not the problem was expected.
(i) Immediacy of
problem solution is a relevant factor in determining the decision time horizon;
that is, how soon a problem solution is needed, will affect the length of
decision process and intensity of decision effort.
(ii) Expectancy
of the problem can affect such facets as the sources of information used in the
decision process, for example, as well as the number of alternative considered.
(iii) Routine
problems are those in which the difference between actual and desired states is
expected to occur and an immediate solution is required. Typically, convenience
goods are associated with this type of problem-recognition, such as most
grocery purchases are made by consumers.
(iv) Emergency problems are those that are
unexpected in which immediate solutions are necessary. For instance, a consumer
who is involved in an automobile accident and totals his car may need a quick
solution to his transportation problem.
(v) Planning
problems occur when the problem occurrence is expected but an immediate
solution is not necessary. For instance, a consumer who expects that his car
will only last one additional year may begin to engage in window shopping for
autos, have discussed with friends about various brands, and pay closer
attention to automotive ads.
(vi) Evolving
situations occur when the problem is unexpected but no immediate solution is
required. The fashion-adoption ordinarily occurs over a lengthy period of time
for many consumers.
Situations
Leading to Problem Recognition: There are numerous situations that may
cause consumer problem recognition to occur. Although discussion of all the
potential sources is impossible, we can present the most significant reasons
and explain briefly how each one might arise.
(i)
Depleted or inadequate stock of goods: The consumer uses up the
assortment of goods she has and must repurchase in order to re-supply her
needs. As long as there still is a basic need for the item, problem recognition
should result from its consumption. Sometimes the consumer’s stock of goods is
inadequate for even her everyday needs and may require a purchase. For
instance, she may want to install a bracket for hanging planter but finds that
she doesn’t have t necessary tools such as ruler, a drill and screwdriver.
(ii)
Discontentment with the stock of goods: Frequently, consumers become
discontented with products they own, and this leads to problem recognition. For
example, men’s ties and jacket lapels narrow and widen as fashion cycle
progress. Consequently, men may feel their clothing is no longer stylish, and
they may desire to update their wardrobes. Even though the old clothes might be
perfectly serviceable, they may be an embarrassment to wear. As a result, this
problem is resolved by purchasing some of the latest fashion.
(iii) Changing
environmental circumstances: Consumers sometimes encounter changes in
their environmental circumstances, which lead to problem recognition. One of
the most significant of these situations in the family’s changing
characteristics. Different lifecycle stages produces need for different
products.
(iv)
Changing financial circumstances: The financial status of the consumer
has a very important relationship to problem recognition. The present or
anticipated financial picture may trigger problem recognition as the consumer
determines what purchases can be afforded.
(v)
Marketing activities: The marketer frequently attempts to precipitate
problem recognition thorough promotional efforts aimed at the consumer. With
such efforts, the marketer seeks to have the consumer perceive a difference of
sufficient magnitude between her desired state (ownership of the product) and
her actual state (not owing it) to engage in search, evaluation, and purchasing
activity for the marketer’s brand.
Results of
Problem Recognition: Once the consumer becomes aware of a problem, two
basic outcomes are possible. One result is for the consumer, in effect, not to
pursue any further problem-solving behavior, which might occur if the
difference between the consumer’s perceived desired and actual states is not
great enough to cause him to act to resolve the difference. Another situation
in which problem recognition may not lead to further stages of consumer
decision making occurs when certain environmental elements preclude it.
Marketing
Implications of Problem Recognition:
The significance
to marketers of the problem-recognition stage of consumer decision-making is
that the process can be effectively measured and can be used to develop and
evaluate marketing strategies.
(i)
Measuring problem recognition: Consumer researchers have found that the
best way to assess the problem-recognition process is through scaling
techniques, which measure purchase intentions. Purchase intentions incorporate
the consumer’s attitudes toward the product and may be viewed as the mental
forerunner of buying behavior.
(ii)
Activating problem recognition: Promotion is an important vehicle used
by marketers to cause problem recognition to occur among potential customers.
Marketers often seek to influence consumer’s desired states such as in much of
the advertising stressing benefits of product ownership. Consumer’s actual
states often develop into situations that are routine, habitual, or unnoticed
patterns of behavior. Many marketing activities, therefore, are designed based
on the assumptions that buying occurs shortly before actual consumption.
(iii)
Utilizing problem recognition information: The marketers need to
analyze the purchase intention categories. For example, measuring the speed,
direction, and size of shifts in buying. The market may also find significant
implications for his marketing strategy by investing the relationship between
purchasing intentions and buying behavior.