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Sinem's Notes-Session 17 - I!I M ICHIGAN r,cfw.I M KT 313...

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I!I MICHIGAN "r,{ ..I .... , MKT 313 CONSUMER BEHAVIOR Prof. Carolyn Yoon Session 17 March 17, 2011 Winter 2011 © Copyright 2011 by Carolyn Yoon. All rights reserved Heuristics in decision making • More formal models are based on two key assumptions: • People have well-defined preferences • People choose optimally relative to those preferences This should work for almost any choice problem Two problems with this formulation People do not have well-defined preferences that they can just "look up" - preferences are often constructed as needed • People have limited information processing capabilities
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"- .. - " --- ""- . ~-..".j Judgment : - :.;:=- and Decision Making ( J ' ~~(lI.;«'Ofo'I S . ~~ .. ----- ~~~ .... - ~ .. t~ f S sa ' ~"' ~ >I ~ttIic . A. ~J, .... ,,:),C Low-Effort Judgment Processes • Satisficing: Finding an option that is "good enough", not necessarily the best • Shortcuts in making Judgments • Availability heuristic • Representativeness heuristic • Base-rate information • Law of small numbers 4 2
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Availability • Frequency or probability estimated by the ease with which instances or associations can be brought to mind. • Items and events that are more easily imagined will be more available in memory than those that are bland, vague, or less easily imagined • Recency • Vividness • Retrievability • These items will often be judged and chosen in a biased manner Q: Which of the following causes more deaths in the US each year? a ~ O (A) Stomach cancer ") ; , . a c£ao.fYl 00 • (8) Motor vehicle accidents --? ~? 0 / ~ /'>-1 / -H 1J'If...~ AA,oJ/ - }Q{)fLt sat (J). ( Q cd~ 1,;11 ~ y T ~ ().> ('IlP/l /1 ! I.t:)"o {) 0 v5 . 6u+ D~ (I I? (/ e.a. c V\.. .?) I.) if ((U)() (-I-) {)IL ~tl 0 ~ ;U»Jspof -, ) .' A 3
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Q: Which of the following causes more deaths in the US each year? • (A) Falling airplane parts • (B) Shark attacks ~ fj k. u,s u cl ()J\~C2f ~ , J 0 --f. (V'J.. "> Q J Mil, / (lA) . A Gt-u(),V (}jL)W af · I U Marketing Implications of Availability? • Provide consumers with positive and vivid product experiences • Super Bowl ads • Stimulate positive WOM (sneak previews) • Others?
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