Sinem's Notes-Session 17

Sinem's Notes-Session 17 - I!I M ICHIGAN " r,cfw_ . .I . ,...

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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'IS ~~ .. ----- ~~~ .... - ~ . t~fSsa ' ~"'~>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 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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This note was uploaded on 02/09/2012 for the course MKT 303 taught by Professor Rajeevbatra during the Fall '11 term at University of Michigan.

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Sinem's Notes-Session 17 - I!I M ICHIGAN " r,cfw_ . .I . ,...

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