14Actual or Perceived Risk Financial riskPerformance riskPsychological riskRisk and risk perceptions play crucial roles in determining the extent of consumer search.Ask students to compare the risk levels associated with the following purchase situations:A gift for the grab bag for the office holiday party.A gift for your mother’s birthday.A gift for your future mother-in-law’s birthday.Ask students: What type of risk is associated with each decision? All involve increasing degrees of psychological risk.
16Test Your KnowledgeConsumers can spend considerable time searching for both specialty and shopping goods or services; the difference lies in _______________.A) the amount of time they haveB) the amount of money they have budgetedC) the psychological riskD) the kind of searchAnswer: D
17Evaluation of Alternatives: Attribute Sets Universal SetRetrieval SetEvoked SetGroup activity: Walk students through the example of planning a vacation. Have students list all possible choices, and then organize them into categories (e.g., beach versus mountain, domestic versus international, inexpensive versus luxury).Choice
23Test Your KnowledgeDecision heuristics are ________ that help a consumer narrow down his or her choices.A) mental shortcutsB) breathing exercisesC) logical stepsD) compensatory decision rulesAnswer: A
30Factors Influencing the Consumer Decision Process After examining the five steps in the consumer decision process, students should begin to focus on the aspects that influence that process. Remind students that every unique person views a purchase situation differently.
36Psychological Factors: Learning Affects both attitudes and perceptionsAffected by social experiencesJust as your perception of the mechanic changed, societies perceptions can change. For example tattoos used to be only considered acceptable for unsavory individuals. There were clearly NOT mainstream, yet today people from a variety of demographic backgrounds get tattooed. Even some parents and children with matching tattoos.
39Test Your KnowledgeWhich of the following is a way in which reference groups might provide information to consumers?A) Leading by exampleB) Indirectly, through observationC) Contacting the sellerD) Web researchAnswer: B
43Chapter 5 GlossaryExtended problem solving: Occurs when a buyer devotes considerable time and effort to analyzing alternatives; common when the customer perceives that the purchase decision entails a lot of risk.External search for information: The buyer seeks information outside his or her personal knowledge base to help make the buying decision.Functional needs: Needs that pertain to the performance of a product or service.Habitual decision making: A purchase decision process in which consumers engage with little conscious effort.Impulse buying: A buying decision made by customers on the spot when they see the merchandise.Internal search for information: The buyer examines his or her own memory and knowledge about the product or service, gathered through past experiences.Limited problem solving: Occurs during a purchase decision that calls for, at most, a moderate amount of effort and time.Psychological needs: Needs that pertain to the personal gratification consumers associate with a product and/or service.Ritual consumption: Refers to a pattern of behaviors tied to life events that affect what and how we consume.