1. Problem Recognition & Information Search
Chapter 2
Problem Recognition & Information Search

2. Chapter Spotlights Consumer decision process action options
Problem recognition: actual state versus desired state and motivation arousal
Pre-purchase, post-purchase, and ongoing information search
Internal and external information search
Consideration sets
Sources of marketplace information

3. Consumer Decision Process Action Options
Start through steps and complete them in order
Start, stop, start, stop, etc. and complete steps in order
Start steps and “loop back” as needed based on what happens and complete process
Start into the process then stop somewhere along the way and never finish
Do not start the process

4. Problem Recognition When consumers realize that they need something!
It is the first step in the decision-making process:
Problem recognition
Information search
Alternative evaluation
Choice
Outcomes

5. Motivational Arousal
Different people have different benefit motivations for purchasing different products or services.
Types of benefit motives:
To optimize satisfaction
To prevent possible future problems
To escape from a problem
To resolve a conflict
To maintain the status quo or satisfaction

6. Problem Recognition: Actual State versus Desired State
It is the psychological process used to determine the difference between the consumer’s actual benefits state (where you are) and the desired benefits state (where you want to be).
Opportunity (vs. problem) recognition

7. Problem Recognition Influences
Situational influences
Consumer influences
Marketing influences

8. Situational Influences
Product consumption (e.g., running out of gas)
Product acquisition (e.g., purchasing a new home may stimulate other purchases)
Changed circumstances (e.g., moving away from home to college)

9. Consumer Influences
Actual state consumers: those who look to existing products to solve their problems.
Desired state consumers: those who shop for new products to address their problems.
They enjoy the shopping experience

10. Marketing Influences
Marketing mix changes and/or promotion actions may help stimulate problem recognition:
Advertising
Coupons
Free offers
sweepstakes

11. Information Search
Information collected by consumers is the basis for evaluation and choice behavior.
It is important for marketers to know:
Why consumers are searching for information
Where will they look
What information consumers seek
How extensively they are willing to search

12. Types of Information Search
Prepurchase search:
Directed searches: consumer searches for information that will help solve a specific problem.
Browsing: consumer is “just looking” with no immediate intent to buy.
Accidental search: consumer is not actively looking for information, but takes note of information that is formally presented or inadvertently encountered.
Post-purchase search: gathering information on choice made after the purchase.
Ongoing search: continuous information gathering to stay “marketplace-current.”

13. Internal and External Information Search
Internal search: search based on existing information in memory.
Information quantity, quality, relevance, currency
Experts vs. novices
External search: the search of information beyond one’s memory.
Personal sources: friends, experts, salespeople
Impersonal sources: advertising, in-store displays, trade reports, the Internet.

14. Why Do Consumers Engage in External Information Search?
High perceived value versus perceived cost of search
Need to acquire information
Ease of acquiring and using information
Confidence in decision-making ability
Locus of control (internals vs. externals)
Actual or perceived risk
Costs of external search
Types of products sought
Characteristics of the purchase decision

15. Types of Risk Functional or performance Financial Psychological Social
Physiological
Time
Linked-decision

16. Costs of External Search
Financial
Time
Decision delay (opportunity cost)
Physical cost
Psychological cost
Information overload

17. Type of Product Sought
Specialty goods: search willingness is high when consumer has developed strong preferences
Shopping goods: less search willingness for products that the consumer must devote time and effort to compare and contrast.
Convenience goods: consumer is reluctant to spend any time and effort in search and evaluation before purchase.

18. Characteristics of Purchase Decision
If number of possible solutions is limited – extensive search is acceptable
If need for trial is high – more likely to search
Difficulty of trial high – search is for quality supplier

19. External Search Strategy
Consideration set: those brands, outlets, etc. that have front-of-mind presence and from among which there is intention to choose.
Which brands of computers would you consider purchasing?
Also called “evoked set” or “relevant set”
Marketplace information sources:
General (face-to-face or mass media)
Marketer-controlled (face-to-face or mass media)