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Chapter 4: Consumer behavior - Coggle Diagram

- - - - The second step is to acknowledge that consumers do in fact face budget constraints that restrict the quantities or amounts of goods and services that can be consumed
      - The third step is to put consumer preferences and budget constraints together to determine choices. Economists do this by assuming that people maximize their satisfaction by combining a set of goods and Services
        
        Graphically they are able to represent this via the use of
        indifference curves and budget lines (the point of tangency) is where our theoretical consumer apportions his consumption of goods X and Y.
      - The first step is to examine consumer preferences this just means what a consumer would theoretically prefer, disregarding prices and income.
    - - individuals are able to make choices and rank their preferences for different goods and services
      - individuals are rational in the choices they make
      - more is preferred to less
      - consumer preferences can be considered in terms of whether a bundle of goods provides more utility (or satisfaction) than another ( ordinal utility)
    - - Preferences reflect what consumers like or value.
      - Constraints—such as budget limits, physical, geographic, or social factors—restrict what they can actually buy.
      - Economists find differences in constraints particularly important, since these are measurable and observable and help explain variations in consumption behavior.
    - - we observe stable behavior that we attribute to cultural factors. Stable consumer behavior often results from the cost of decision-making, not just cultural habits. Making a choice requires information gathering and analysis, which are costly in time and effort.
      - Because of these information (search) costs, consumers are less likely to change their behavior in response to temporary changes (like short-term price or income fluctuations). They will only switch products if:
        
        a) there’s a large increase in available information (e.g., a strong advertising campaign), or
        
        b) the product’s price drops enough to offset the cost of learning about it.
      - When permanent changes occur (like the shift to a market economy in the former Soviet Union), younger consumers tend to adapt more quickly than older ones. Economically, this is not because of cultural or personality differences but because older consumers have higher “disinvestment costs”—they have invested more time in learning old habits and have fewer years to benefit from learning new ones. Younger consumers, having less to unlearn and more to gain in the long run, have a stronger incentive to acquire new knowledge and adapt to new environments.
  - - - often emotional and biased, not purely logical. Specifically, people evaluate potential outcomes in terms of gains and losses relative to a reference point (such as the price they paid for their current product), rather than absolute value.
    - - Perceived value matters more than actual value — consumers judge worth subjectively.
      - Reference points influence perception — people compare new options to what they already own or recent prices they’ve seen.
      - Gains and losses are viewed differently — outcomes above the reference point feel like gains, while those below feel like losses.
      - Loss aversion dominates — losses feel stronger than equivalent gains. For example, losing $100 feels worse than gaining $100 feels good.
    - - In marketing, this insight can be used to encourage trials, ownership experiences, or product demonstrations so consumers feel a sense of possession, increasing their likelihood of purchase.
    - - Initial purchase decision – Consumers evaluate transaction costs (time, effort, hassle of returning the product).
        
        If these costs are perceived as low, they are more likely to buy.
      - Post-trial decision – After using the product (e.g., two weeks later), consumers decide whether to return it.
        
        If they have adapted to and used the product, the perceived cost of returning it becomes an opportunity cost, making them more likely to keep it.
  - - - Assumes fixed preferences and self-interest—consumers gain utility from consuming more goods.
        Firms satisfy consumers primarily by supplying desired goods or adjusting prices.
    - - Consumers are not solely self-interested; utility includes social factors and other influences.
      - Preferences can change over time, and firms can influence choices by socializing consumers or shaping attitudes.
      - Motivation comes from intrinsic factors like preferences, personality, and self-concept, not just price or cost.
    - - Economic view emphasizes extrinsic motives (price, cost).
        Social-psychological view emphasizes intrinsic motives (attitudes, self-creation, social influence).
    - - Some economists try to enhance utility-maximization models with social psychology, but social psychologists focus more on personality and the process of self-creation than on fixed preferences.
  - - - Actual self-congruence – the brand reflects the consumer’s current identity (“this brand is like me”).
        Ideal self-congruence – the brand reflects the consumer’s aspirational identity (“this brand is like who I want to be”).
      - Consumers choose brands that match either their actual or ideal self, reinforcing identity and self-expression.
    - - Internal (due to personal traits, e.g., “I failed because I’m not good at math”)
        External (due to external factors, e.g., “The test was unfair”).
      - These attributions form part of a feedback loop that shapes and reinforces a person’s self-concept.
        
        Both self-perception (how a person explains their own behavior) and external perception (how others explain it) influence how individuals view themselves and adjust future behavior.
    - - In this version of the feedback loop, actions come before reasons — people act first and justify later.
      - After taking an action (like making a high-involvement purchase), consumers may feel post-purchase dissonance and try to rationalize their decision to maintain internal consistency (e.g., “I bought this car—it must be the best choice”).
      - Over time, this rationalization reinforces their self-concept (e.g., “I’m the type of person who buys premium cars”).
    - - In this model, society and culture shape self-concept and, in turn, behavior.
      - Social pressures and norms act early in life, shaping preferences and identities (e.g., French people preferring wine, Germans preferring beer).
      - These cultural influences become deep-rooted personality traits that are difficult to change.
      - Hence, marketers focus heavily on younger audiences, whose self-concepts are still forming and can be more easily influenced.
  - - - Tie Strength
        
        Refers to how close or intense a relationship is.
        
        Strong ties: family, best friends → have the greatest influence because of trust and emotional connection.
        
        Weak ties: acquaintances or colleagues → less direct influence but can introduce new ideas or products.
      - Homophily (Social Similarity)
        
        People tend to associate with and trust others who are similar to them (in beliefs, education, lifestyle, etc.).
        
        We are more likely to believe product recommendations from people who share our preferences or backgrounds.
        
        Similarly, we tend to share product opinions with people who are like us.
        
        So, similarity increases influence.
      - Degree of Centrality
        
        Refers to how connected someone is within a social network — how many people they interact with directly.
        
        Highly connected individuals (influencers, community leaders, etc.) can affect many others’ choices.
        
        However, because they divide their attention among many people, the depth of influence on each individual might be weaker.
    - - What we own and how we behave can signal who we are and what social group we belong to.
        People use brands and products to express identity and group membership — for example, wearing designer clothes or driving a certain type of car (conspicuous consumption)
      - Two groups engage in this behavior:
        
        Actual members of a social group (e.g., athletes wearing Nike).
        Aspirational members — people who want to be seen as part of that group (e.g., someone wearing Nike to seem sporty).
    - - Explicit Signals
        
        Visible, ostentatious, easy to recognize
        
        Large brand logos, flashy designer bags
        
        Help communicate identity to others, but make it easy for outsiders to imitate the look
      - Subtle Signals
        
        Low-key, recognizable mainly by insiders
        
        Minimal logos, distinctive yet understated fashion
        
        Allow insiders to differentiate themselves from imitators and signal belonging discreetly
      - When outsiders start copying explicit signals (e.g., wearing fake designer items to appear rich or trendy), insiders move toward subtle signals to maintain exclusivity.
        Subtle markers require “insider knowledge” to interpret — they act as secret codes of belonging within the group.
  - - - Emphasises environmental factors that shape observable actions.
      - Humans are seen as responding to stimuli — such as pricing, promotions, or availability.
      - Closely parallels the traditional economic model, where decisions depend on constraints (income, prices, etc.).
      - This view implies “actions speak louder than words” — what people do matters more than what they say they think.
      - Example: A consumer repeatedly buying Coca-Cola because it’s conveniently available, not necessarily due to deep brand loyalty.
    - - Focuses on how consumers process, store, and use information to make decisions.
      - Consumers are autonomous decision-makers, guided by mental constructs like beliefs, memories, and evaluations.
      - Related to quasi-rational economics, where decision-making includes both rational calculation and psychological biases.
      - Cognitive models help explain brand loyalty, attitude formation, and information-driven choices.
      - Example: A consumer choosing a smartphone after comparing specifications, reviews, and brand reputation.
    - - People can hold two attitudes toward the same object — one explicit (conscious) and one implicit (unconscious).
        These can even contradict each other.
        
        This duality shows:
        
        Consumers don’t always act consistently with what they consciously believe.
        Marketing strategies must account for both conscious reasoning (through rational messaging) and unconscious desires (through sensory or emotional appeal).
    - - Behavioural insights help marketers design environments that trigger desired actions (e.g., placement, promotions).
      - Cognitive insights help marketers shape beliefs, preferences, and brand loyalty.
      - The dual attitude model suggests campaigns can succeed even when consumers say they disapprove of a product — emotional associations can still drive behaviour.
      - Effective marketing blends both approaches — influencing both what people think and how they behave.
  - - - Unconditioned stimulus (food) → automatically causes salivation.
      - Neutral stimulus (bell) → initially has no meaning.
      - Pavlov repeatedly paired bell + food.
      - This means the bell became a discriminative stimulus
      - Classical conditioning = learning through association.
        A neutral stimulus becomes capable of producing a response because it is repeatedly paired with something that naturally triggers that response.
      - Marketers pair brands with positive stimuli: Music, Emotional content, or attractive people
    - - Operant conditioning = behaviour changes because it is rewarded (reinforced) or punished.
      - Marketers use reward systems to reinforce repeat purchases.
        These are called fixed-ratio reinforcement schemes:
      - The reward encourages:
        repeat behaviour, Loyalty, habit formation
  - - - Level of involvement (high vs low)
        Perceived differences between brands
    - - Complex Buying Behaviour
        
        • High involvement + Significant differences
        
        • Cognitive, information-heavy evaluation
        
        • Marketers use detailed, information-rich promotion
      - Dissonance-Reducing Buying Behaviour
        
        • High involvement + Few brand differences
        
        Consumer may feel uncertain → risk-based buying
        
        Post-purchase dissonance likely
      - Habitual Buying Behaviour
        
        Low involvement + Few brand differences
        
        Automatic, routine purchasing
        
        Driven by familiarity and conditioning
        
        Advertising uses repetition and symbols
      - Variety-Seeking Buying Behaviour
        
        Low involvement + Significant differences
        
        Consumers switch brands often out of curiosity or dissatisfaction
        
        Consumers switch brands often out of curiosity or dissatisfaction
  - - - Focuses on information and rational evaluation
      - Used when involvement is high
      - Works in open settings where consumers control environment
    - - Focuses on emotional triggers, conditioning, associations
      - Works when involvement is low
      - More effective in closed settings (e.g., supermarkets)
- - - - The set of basic values, perceptions, wants, and behaviors learned by a member of society from family and other important institutions
      - An American child is exposed to values such as achievement and success, freedom, individualism, etc.
      - Marketers are always trying to spot cultural shifts in order to predict new products that may be wanted.
    - - Each culture contains a group of people with shared value systems based on common life experiences and situations
      - It includes nationalities, religions, racial groups, and geographic regions. They are often large groups that have marketers tailor products and marketing programs for them
      - Examples include:
        
        Hispanic American Consumers are a fast-growing, youthful market with strong buying power. They’re family-oriented, with older consumers showing brand loyalty and younger ones being more price-sensitive. They’re also highly active on social media, making digital marketing especially effective.
        
        African American Consumers are an affluent, growing market with strong brand awareness and nearly $1.3 trillion in buying power. They’re price-conscious yet value quality and selection and are highly active on digital and social media.
        
        Asian Americans Consumers are the most affluent and educated U.S. demographic, with strong brand loyalty and nearly $1 trillion in buying power. They’re highly diverse in nationality and language, shop frequently, and are very brand-conscious, making them a key target for marketers.
      - Total market strategy
        
        Integrating ethnic themes and cross cultural perspectives within a brand’s mainstream marketing, appealing to consumer similarities across subcultural segments rather than differences.
        
        Marketers increasingly use insights from ethnic groups to shape mainstream strategies. Influences from Hispanic and African American culture drive youth trends, and consumers now expect diversity in ads and products.
    - - Relatively permanent and ordered divisions in a society whose members share similar values, interests, and behaviors.
      - Social scientists have identified seven American social classes: upper upper class, lower upper class, upper middle class, middle class, working class, upper lower class, and lower lower class.
      - Social class is not determined by a single factor, such as income, but is measured as a combination of occupation, income, education, wealth, and other variables.
      - Marketers are interested in social class because people within a given social class tend to exhibit similar buying behavior. Social classes show distinct product and brand preferences in areas such as clothing, home furnishings, travel and leisure activity, financial ser vices, and automobiles
      - In some social systems members of different classes are reared for certain roles and cannot change their social position however, this line is blurred in countries such as the US
  - - - Groups are Two or more people who interact to accomplish individual or mutual goals.
        
        Groups that have a direct influence and to which a person belongs are called membership groups. In contrast, reference groups serve as direct (face-to-face interactions) or indirect points of comparison or reference in forming a person’s attitudes or behavior. People often are influenced by reference groups to which they do not belong. For example, an aspirational group is one to which the individual wishes to belong,
        
        Marketers study reference groups because they shape consumers’ attitudes, behaviors, and brand choices. Their influence is strongest for products that are visible to others and when buyers seek approval or respect from those groups.
      - Word-of-mouth strongly influences buying decisions, as people trust recommendations from friends and family more than ads or salespeople.
        
        Marketers target opinion leaders people with influence due to their skills, knowledge, or personality since they shape others’ buying decisions. Reaching these “influentials” helps spread brand messages effectively. Brand Ambassador & Evangelists
      - Online social networks: Online social communities blogs, online social media, brand communities, and other online forums where people socialize or exchange information and opinions. (from social media to communal shopping sites and blogs) word-of-web
    - - Family members can strongly influence buyer behavior. The family is the most important consumer buying organization in society
      - In a traditional family Husband–wife involvement varies widely by product category and by stage in the
        buying process. Buying roles change with evolving consumer lifestyles.
        
        In the US there has been a shift in roles of more husbands doing the grocery shopping then wives meaning that the marketers now should shift their target to the other gender
    - - A person belongs to many groups family, clubs, organizations, online communities. The person’s position in each group can be defined in terms of both role and status.
      - A role consists of the activities people are expected to perform according to the people around them. Each role carries a status reflecting the general esteem given to it by society.
  - - - A person’s occupation influences their purchasing choices. Blue-collar workers buy practical, durable clothing, while executives prefer business attire. Marketers identify and target occupational groups most interested in their products, with some companies specializing in items for specific professions.
      - Ex: CAT produces rugged mobile phones designed for harsh work environments where regular smartphones are unsuitable.
    - - People’s purchasing habits change throughout their lives as their age, tastes, and life circumstances evolve. Factors like marriage, having children, moving, or retirement influence what they buy.
      - Marketers often segment their target markets by life-cycle stage and create products and marketing strategies tailored to each stage’s needs and preferences.
    - - A person’s economic situation influences their choice of products and stores. Marketers track trends in income, spending, savings, and interest rates.
      - As consumers have become more value-conscious, companies respond by redesigning, repositioning, and repricing their products to offer greater value.
    - - Lifestyle refers to a person’s pattern of living, reflected in their activities, interests, and opinions (AIO). Even people from the same social class or occupation can have very different lifestyles.
      - It goes beyond personality or class by describing how individuals act and interact with the world. Marketers use lifestyle analysis to understand consumer values and behaviors, recognizing that people don’t just buy products they buy the lifestyles and values those products represent.
    - - Each person’s unique personality shapes their buying behavior. Personality includes traits like confidence, sociability, and adaptability, which can influence product and brand choices.
      - Similarly, brands have personalities—such as sincerity, excitement, competence, sophistication, or ruggedness—and consumers tend to prefer brands that match their own traits.
      - Related to this is the concept of self-image, which suggests that people’s possessions reflect and express their identities. Therefore, marketers aim to align brand personalities with the self-concept of their target consumers.
  - - - People have many needs—some biological (e.g., hunger, thirst, discomfort) and others psychological (e.g., recognition, esteem, belonging). A need becomes a motive when it is strong enough to drive action toward satisfaction.
      - Sigmund Freud’s theory suggests that many buying decisions are influenced by unconscious motives that consumers themselves may not fully understand. Example: An older person buying a sporty car may subconsciously want to feel young or display success, even if they justify it differently.
      - Because consumers often can’t explain their true motivations, companies use motivation research involving psychologists and social scientists to explore hidden drivers of behavior. (hypnosis, dream analysis, therapy-like interviews)
      - Though some see these methods as unscientific, many marketers use such interpretive consumer research to gain deeper psychological insights and design more effective marketing strategies.
      - Maslow’s theory explains why people prioritize different needs at different times. He proposed that human needs are arranged in a hierarchy, from the most basic to the most advanced. People typically focus on satisfying lower-level needs before moving to higher-level ones. But as each important need is satisfied, the next most important need
        will come into play.
        
        Physiological needs – basic survival needs like food and water.
        
        Safety needs – security and stability.
        
        Social needs – love, belonging, and relationships.
        
        Esteem needs – respect, recognition, and status.
        
        Self-actualization needs – personal growth and fulfillment.
    - - A motivated person is ready to act, but their actions depend on their perception of the situation. Perception is how people select, organize, and interpret sensory information (from sight, sound, smell, touch, and taste) to form a meaningful understanding of the world.
      - perceive the same information differently due to three key processes:
        
        Selective attention – people filter out most stimuli and only notice what seems relevant to them; marketers must work hard to capture attention.
        
        Selective distortion – people interpret information in a way that confirms their existing beliefs and attitudes.
        
        Selective retention – people remember information that supports their beliefs and forget information that contradicts them.
      - Because of these filters, marketers face challenges in ensuring their messages are noticed, understood, and remembered. Some consumers fear being influenced unconsciously through subliminal advertising, but experts generally agree it does not actually exist.
    - - Learning refers to changes in behavior that result from experience. Most human behavior is learned through interaction with the environment. Learning happens through the interaction of drives, stimuli, cues, responses, and reinforcement.
      - A drive is a strong internal urge that pushes a person to take action. When a drive is directed toward a specific stimulus or goal, it becomes a motive.
    - - Through experience, people develop beliefs and attitudes, which strongly influence their buying behavior. A belief is a descriptive thought someone holds about something, based on knowledge, opinion, or faith. Marketers study consumer beliefs since they shape brand and product images that affect purchasing decisions. If false beliefs prevent purchase, marketers may create campaigns to correct them
      - An attitude is a person’s consistent evaluation, feeling, or tendency toward an object or idea—whether they like, dislike, approach, or avoid it. Attitudes are hard to change because they form part of a broader, interconnected pattern.
      - Therefore, marketers usually aim to align products with existing attitudes rather than trying to change them.
        However, changing attitudes may be necessary when repositioning or extending a brand.
- - - - Complex buying behavior occurs when consumers are highly involved in a purchase and see major differences between brands.
        
        This usually happens with products that are expensive, risky, purchased infrequently, or express personal identity (e.g., buying a car).
      - Consumers go through a learning process:
        
        Develop beliefs about the product.
        
        Form attitudes toward different options.
        
        Make a careful, informed purchase decision.
      - Marketers of high-involvement products should:
        
        Understand how consumers gather and evaluate information.
        
        Educate buyers about key product features and their importance.
        
        Highlight brand differences through detailed materials, ads, or videos.
        
        Encourage salespeople and social influencers to guide the final brand choice.
    - - Dissonance-reducing buying behavior occurs when consumers are highly involved in a purchase (because it’s expensive, rare, or risky) but see little difference between brands.
      - Since brand differences appear small, buyers may compare options briefly and then make a quick purchase, often based on price or convenience.
        After buying, consumers may feel postpurchase dissonance (doubt or discomfort) if they notice downsides of their choice or hear good things about alternatives.
      - To reduce this dissonance, marketers should use after-sale communication to reassure customers, highlight product benefits, and reinforce that they made the right choice.
    - - Habitual buying behavior occurs when consumer involvement is low and there are few differences between brands.
        Consumers purchase out of habit, not strong brand loyalty, often for low-cost, frequently bought products.
      - The usual belief → attitude → behavior sequence is bypassed:
        
        Consumers do little information search or evaluation.
        Purchase decisions are quick and automatic, with minimal post-purchase evaluation.
      - Brand beliefs are formed through passive learning, leading directly to purchase behavior.
      - Marketers of low-involvement products often use:
        
        Price promotions or sales incentives to drive purchases.
        
        Product features or enhancements to differentiate the brand and increase consumer involvement.
    - - Variety-seeking buying behavior occurs when consumer involvement is low but there are significant perceived differences among brands.
        Consumers often switch brands out of boredom or curiosity, not dissatisfaction.
      - Marketing strategies differ for market leaders and challenger brands:
        
        Market leaders aim to encourage habitual buying by dominating shelf space, keeping products in stock, and running frequent reminder ads.
        
        Challenger brands stimulate variety-seeking through lower prices, special offers, coupons, free samples, and advertising that motivates trying something new.
  - - - Information Search
        
        Evaluation of alternatives
        
        Purchase Decision
        
        Post-purchase Behavior
    - - The process depends on the buyer, the product, and the buying situation.
    - - the buyer recognizes a problem or need. The need can be triggered by internal stimuli when one of the person’s normal needs
      - A need can also be triggered by external stimuli. For example, an advertisement or a discussion
      - At this stage, the marketer should research consumers to find out what kinds of needs or problems arise, what brought them about, and how they led the consumer to this particular product.
    - - Consumers may or may not search for information before buying.
        
        If the need is strong and a suitable product is nearby, they may buy immediately.
        Otherwise, they may store the need in memory or conduct an information search.
      - Sources of information include:
        
        Personal sources – family, friends, neighbors, acquaintances.
        
        Commercial sources – advertising, salespeople, websites, packaging, displays.
        
        Public sources – mass media, consumer ratings, social media, online reviews.
        
        Experiential sources – examining or using the product.
      - The influence of these sources depends on the product and the buyer.
        Traditionally, commercial sources provide most product information, but personal sources are often more persuasive, as they validate and evaluate products.
      - As consumers gather information, their awareness and knowledge of brands and features grow.
        
        Companies should design their marketing mix to increase awareness and knowledge, and identify which information sources are most important to their target consumers.
    - - Alternative evaluation refers to how consumers process information to choose among different brands.
      - Evaluation methods vary depending on the consumer and the buying situation:
        
        Some use careful calculations and logical analysis.
        
        Others rely on impulse, intuition, or minimal evaluation.
      - Consumers may make decisions independently or seek advice from friends, online reviews, or salespeople.
      - Marketers should study how buyers evaluate alternatives to understand decision-making processes.
        Understanding these processes allows marketers to influence the buyer’s choice effectively.
    - - The marketer’s role continues after the purchase, as consumers engage in postpurchase behavior.
        Satisfaction depends on the gap between expectations and perceived performance:
        
        Falls short → disappointment
        
        Meets → satisfaction
        
        Exceeds → delight
      - Sellers should promise only what they can deliver to avoid dissatisfaction.
        Cognitive dissonance often occurs after major purchases:
        
        Consumers feel uneasy about the drawbacks of the chosen brand and missing benefits of other brands.
      - Customer satisfaction is crucial for building profitable, long-term relationships:
        
        Satisfied customers repurchase, give positive word of mouth, ignore competitors, and buy other products.
        Marketers aim not just to meet expectations but to delight customers.
      - Dissatisfied customers can damage brand reputation through negative word of mouth.
      - Many unhappy customers don’t report problems, so companies should:
        
        Regularly measure satisfaction
        
        Set up systems to encourage complaints
        
        Use feedback to improve products and services.
    - - Typically, they plan to buy their most preferred brand, but two factors can alter this decision:
        
        Unexpected situational factors – changes in income, price, product availability, or other unforeseen events.
        
        Attitudes of others – opinions or influence from friends, family, or peers.
      - During the evaluation stage, consumers rank brands and form purchase intentions.
      - Even well-formed purchase intentions can be changed by unexpected circumstances.
    - - motivation behind information search
        
        When a purchase involves high perceived risk, the consumer experiences:
        
        Distress
        
        Anxiety
        
        Uncertainty
        
        This emotional state pushes the consumer to take action to regain a feeling of control.
      - Consumers Respond: Two Main Strategies
        
        Reduce Uncertainty by Increasing Information Search
        
        Information reduces ambiguity.
        
        Information makes the choice clearer.
        
        Information justifies the decision.
        
        Reduce Vulnerability by Lowering the Amount at Stake
        
        Choosing a cheaper model instead of the expensive one
        
        Buying less quantity
        
        Selecting a brand with a strong warranty
      - Search vs. Experience Attributes (Huang et al., 2009) — Explained
        
        Search Attributes
        
        Qualities that can be evaluated without physically interacting with the product.
        
        Price
        
        Colour
        
        Dimensions
        
        Technical specifications
        
        Online relevance:
        Websites easily provide search attribute information through: Specifications list, pics
        
        Consumer behaviour: Low effort to process
        Easy to compare across brands
        Higher tendency to free-ride: gather information on one retailer’s site, then buy elsewhere cheaper
        
        Experience Attributes
        
        Qualities that require interaction or product use to evaluate.
        
        Picture quality of a camera
        
        Comfort of wearing shoes
        
        Taste of food
        
        Online relevance: Surprisingly, the internet can still give experience-related information through: User reviews & Ratings
        
        Challenge: Experience information is subjective, varies between reviewers, and is harder to compare.
        
        The Problem: Inconsistent Experience Information
        Since experience-based reviews differ in detail, tone, and criteria, consumers face inconsistent information.
        
        Three Solutions Consumers Use to Interpret Mixed Experience Information:
        
        Synthesising across multiple sources
        
        Evaluating attributes at a higher, more abstract level
        
        Restructuring information
        
        Free-Rider Problem in Online Shopping
        Retailers spend money building high-quality websites to give rich information.
        but:
        Consumers may gather the information, then leave to buy cheaper elsewhere. This is free-riding, and the internet makes it easier.
        
        Experience Goods Are Less Vulnerable to Free-Riding
        
        Higher learning costs
        
        Experience information is presented through complex interfaces → users learn how to navigate a specific site.
        
        Cognitive lock-in
        
        Once consumers are used to one website’s layout, reviews, and style, they are less willing to switch to another.
        
        ✅ Trust Differences: Search vs. Experience
        
        Search attributes = factual → consumers assume information is accurate.
        Experience attributes = subjective → consumers rely more on trusted sellers.
      - Alternative-based and attribute-based search
        strategies
        
        Alternative-Based Search
        
        You take one laptop at a time and evaluate all its attributes together
        
        Associated with:
        ➡️ Compensatory decision rule (holistic evaluation.)
        
        Why: Because compensatory rules balance trade-offs. This requires viewing all attributes at once for each alternative.
        
        Attribute-Based Search
        
        You evaluate one attribute at a time across all products.
        Then move on to the next attribute.
        
        Associated with:
        ➡️ Non-compensatory decision rule (strict elimination rule.)
        Why: Because non-compensatory rules eliminate options based on thresholds. Here, you focus on attributes one by one and eliminate based on each attribute.
      - Information Control
        
        The degree to which consumers can choose what, when, and in what order they access information.
        
        Levels of Information Control
        
        High control → Pull model
        
        User requests information.
        
        User chooses content, display sequence, and reading time.
        
        Example: Searching online for reviews.
        
        Low control → Push model
        
        Information is sent without request.
        
        Example: Pop-up ads.
        
        Negative Effects
        
        Information control consumes cognitive resources.
        When consumers must both search and control the information flow, working memory is overloaded.
        
        Result: Lower processing performance.
        
        Positive Effects
        
        Enables personalized pacing and content selection
        
        Supports better information processing for people who need more time.
        
        Helps decision-making when matched with consumer ability and confidence.
- - - - Awareness – The consumer becomes aware of the product but lacks detailed information.
      - Interest – The consumer actively seeks information about the product.
      - Evaluation – The consumer considers whether trying the product is worthwhile.
      - Trial – The consumer tests the product on a small scale to assess its value.
      - Adoption – The consumer decides to use the product fully and regularly.
  - - - Innovators – venturesome, willing to try new ideas at some risk.
      - Early adopters – respected opinion leaders who adopt early but carefully.
      - Early mainstream adopters – deliberate, adopt before the average person but are not leaders.
      - Late mainstream adopters – skeptical, adopt only after a majority has tried the product.
      - Laggards – tradition-bound, suspicious of change, adopt only when the product is widely accepted.
  - - - Relative Advantage – How much better the innovation is than existing products.
      - Compatibility – How well the innovation fits consumers’ values and experiences.
      - Complexity – How difficult the innovation is to understand or use.
      - Communicability (Observability) – How easily results of using the innovation can be seen or shared.
      - Divisibility (Trialability) – The ease of trying the innovation on a limited basis.