BB Chapter Three: Problem Recognition

1. Chapter Three:
Problem Recognition
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2. Problem recognition
An important stage of consumer decision making
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3. Problem recognition
•
Nature of problem recognition
•
Difference between habitual, limited and
extended decision making
•
Methods for measuring problem recognition
•
Uncontrollable factors that effect problem
recognition
•
Marketing strategies based on problem
recognition
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4. Need/problem recognition
•
What happens during need/problem
recognition?
•
Can they be activated?
•
Are there non-marketing influences?
•
What marketing influences are used?
•
Does it vary from one person to the next?
•
Implications for marketing strategy?
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5. Types of consumer decisions
•
Problem
recognition
•
Purchase
involvement
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6. Types of Consumer Decisions Types of Consumer Decisions Purchase involvement Purchase involvement
is the
level of concern for, or interest
in, the purchase process.
Triggered by need to consider a
particular purchase.
A temporary state influenced by
the interaction of individual,
product, and situational
characteristics.
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7. Types of Consumer Decisions Types of Consumer Decisions
A consumer may be very
involved with a brand (e.g.,
Starbucks) or a product
category, BUT…
have low purchase
involvement due to brand
loyalty, time pressures, etc.
Product involvement Product involvementor
enduring involvement enduring involvementis very different
from purchase involvement.
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8. Types of consumer decisions (cont.)
•
Purchase involvement
–
influenced by the interaction of individual, produc t
and situational characteristics
•
Forms of involvement and outcomes
–
Habitual decision making—single brand
–
Limited decision making
–
Extended decision making
•
Implications for strategy
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9. Purchase involvement and types
of decision making
Low purchase
involvement
High purchase
involvement
Habitual
decision
making
Limited
decision
making
Extended
decision
making
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10. Types of Decision Making Types of Decision Making
Habitual decisions occur when
there is very low involvement
with the purchase.
A completely habitual decision
does not even include
consideration of the “do not
purchase”alternative.
Consumer buys Campbell Consumer buys Campbell
’’
s s
without considering other brands, without considering other brands, its price, etc. its price, etc.
Habitual decision making Habitual decision making, in effect involves no dec ision per
se. Go back to buy the same brand.
Habitual Decision Making Habitual Decision Making
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11. Types of Decision Making Types of Decision Making Middle ground
between
habitual and extended
decision making.
Involves recognizing a
problem for which there are
several possible solutions.
Decision based only on Decision based only on buying the cheapest rolls. buying the cheapest rolls.
Limited decision making Limited decision making involves internal and limit ed
external search, few alternatives, simple decision rules on
a few attributes, and little post-purchase evaluati on.
Limited Decision Making Limited Decision Making
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12. Types of Decision Making Types of Decision Making It is a response to the high level
of purchase involvement.
During post-purchase evaluation,
doubts are likely and a thorough
evaluation takes place.
Emotional decisions may involve Emotional decisions may involve substantial cognitive effort. substantial cognitive effort.
Extended decision making Extended decision makinginvolves extensive internal and
external search followed by a complex evaluation of multiple
alternatives.
Extended Decision Making Extended Decision Making
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13. Purchase involvementand types
of decision making(cont.)
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14. The Process of Problem Recognition The Process of Problem Recognition
Problem recognition Problem recognitionis the result of a gap between a
desired state and an actual state sufficient to aro use and
activate the decision process.

An
actual state actual state
is the way an individual perceives
his/her feelings and situation to be at the present
time.

A
desired state desired state
is the way an individual wants to
feel or be at the present time.
The Nature of Problem Recognition The Nature of Problem Recognition
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15. Process of problem recognition
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16. The Process of Problem Recognition The Process of Problem Recognition
1. The
magnitude of the discrepancy
between
the desired and actual states, and
2. The
relative importance
of the problem
Desire to resolve a particular problem depends on:
The Nature of Problem Recognition The Nature of Problem Recognition
In general, importance is determined by how critica l the
problem is to maintenance of desired lifestyle.
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17. Products are positioned as providing a potential
solution eg. shampoo
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18. Products are positioned as providing a potential
solution eg. cough medicine
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19. Types of consumer problems
•
Active problem
–
A problem the consumer is aware of, or will
become aware of, in the normal course of
events.
•
Inactive problem
–
A problem of which the consumer is not yet
aware.
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20. The Process of Problem Recognition The Process of Problem Recognition
Types of Consumer Problems Types of Consumer Problems
Active Problem Active Problem An
active problem active problem is one the
consumer is aware of or will
become aware of in normal
course of events.
Marketing strategy Marketing strategy:
Only require marketer to
convince consumers that its
brand is the superior solution.
Inactive Problem Inactive Problem An
inactive problem inactive problem is one of
which the consumer is not
aware.
Marketing strategy Marketing strategy:
Marketer must convince
consumers that they have the
problem AND
that their brand
is a superior solution.
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21. •
Routine
problems
–
Expected, require immediate solution
•
Emergency
problems
–
Not expected, require immediate solution
•
Planning
problems
–
Expected, don’t require immediate solution
•
Evolving
problems
–
Not expected, don’t require immediate solution
Types of consumer problems
and action required
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22. Non-marketing factors affecting
problem recognition
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23. Factors
that influence the
desired state
•
Culture/social class, e.g. importance of
cleanliness
•
Reference groups, e.g. a change after
graduation
•
Family/household, e.g. family brands
•
Change in financial status, e.g. retrenchment
•
Previous purchase decisions
•
Individual development
•
Motives: refer to Maslow’s needs
•
Emotions: seek positive experiences?
•
The situation
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24. Factors influencing the
actual state
•
Past decisions
•
Normal depletion
•
Product/brand performance
•
Individual development
•
Emotions
•
The efforts of consumer groups
•
The availability of products
•
The current situation
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25. Uncontrollable Determinants of Problem Uncontrollable Determinants of Problem Recognition Recognition
Variety Variety
--
seeking seeking
is a challenge to marketers because it means
that consumers switch brands for reasons beyond a company’s
control.
Sensory Sensory
--
specific satiety specific satiety
–
consumers get bored (satiated)
with sensory attributes more than
on non-sensory attributes.
Offering variety on key sensory
attributes can increase loyalty to
the brand even if consumers
engage in variety seeking.
Variety WITHIN brand can drive Variety WITHIN brand can drive loyalty in the face of variety loyalty in the face of variety seeking. seeking.
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26. Marketing Strategy and Problem Marketing Strategy and Problem Recognition Recognition 1.1.
Discovering Consumer Problems Discovering Consumer Problems
2.2.
Responding to Consumer Problems Responding to Consumer Problems
3.3.
Helping Consumers Recognize Problems Helping Consumers Recognize Problems
4.4.
Suppressing Problem Recognition Suppressing Problem Recognition
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27. Marketing Strategy and Problem Marketing Strategy and Problem Recognition Recognition
A wide variety of approaches are used to determine the
problems consumers face.
Discovering Consumer Problems Discovering Consumer Problems
1.1.
Intuition Intuition - the most common, however, the problem ide ntified
may be of low importance to most consumers
2.2.
Survey Survey – asks relatively large numbers of individual s about
the problems they are facing
3.3.
Focus Groups Focus Groups – composed of 8 to 12 similar individua ls
brought together to discuss a particular topic; a m oderator is
present to keep the discussion moving and focused on the
topic but otherwise free flowing
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28. Product / brand performance
Many products need to perform on two levels: •
Instrumental performance
•
Expressive performance
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29. Marketing strategy and
problem recognition (cont.)
•
Measuring problem recognition (cont.)
–
Problem analysis—product/brand
solutions?
–
Human factors research—suit users
–
Emotion research—how people feel
about it
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30. Marketing Strategy and Problem Marketing Strategy and Problem Recognition Recognition
Human Factors Research Human Factors Research Human factors research attempts to determine human capabilities
in areas such as vision, strength, response time, f lexibility, and
fatigue and the effect on these capabilities of lig hting, temperature,
and sound.
Observational techniques
such as slow-motion and time-
lapse photography, video recording, and event recor ders are
particularly useful methods.
This type of research can sometimes identify functi onal
problems that consumers are unaware of.
Discovering Consumer Problems Discovering Consumer Problems
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31. Marketing Strategy and Problem Marketing Strategy and Problem Recognition Recognition
Emotion Research Emotion Research Marketers are increasingly conducting research on t he role of
emotions in problem recognition and resolution.
Common approaches are
focus group research focus group research
and
personal personal
interviews interviews that examine the emotions associate with certain
problems.
Critical in helping marketers anticipate consumer r eaction to
problems and train customer service personnel to re spond
appropriately.
Discovering Consumer Problems Discovering Consumer Problems
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32. Marketing strategy and
problem recognition
•
Measuring problem recognition
–
Activity analysis
—study of meal
preparation
–
Product analysis
—problems using it?
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33. Marketing Strategy and Problem Marketing Strategy and Problem Recognition Recognition
Surveys and focus groups use one of the following a pproaches
to problem identification:
Discovering Consumer Problems Discovering Consumer Problems
1. Activity Analysis
Focuses on a particular activity to determine
what problems consumers encounter during the
performance of the activity.
2. Product Analysis
Examines the purchase or use of a particular
product or brand. Consumers may be asked
about problems associated with using a product
or brand.
3. Problem Analysis
Starts with a problem and asks which activities,
products, or brand are associated with (or
perhaps could eliminate) those problems
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34. Marketing Strategy and Problem Marketing Strategy and Problem Recognition Recognition
Once a consumer problem is identified, the manager may
structure the marketing mix to solve the problem.
This can involve:
Responding to Consumer Problems Responding to Consumer Problems
• Developing a new product or altering an existing o ne
• Modifying channels of distribution
• Changing pricing policy, or
• Revising advertising strategy
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35. Responding to consumer problems
•
Activating problem recognition
–
Generic problem e.g. dairy foods

when the problem is latent or of low
importance
–
Selective problem recognition e.g. one
brand solution
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36. Marketing Strategy and Problem Marketing Strategy and Problem Recognition Recognition
Generic versus Selective Problem Recognition Generic versus Selective Problem Recognition Helping Consumers Recognize Problems Helping Consumers Recognize Problems
Generic Problem Recognition Generic Problem Recognition • Involves a discrepancy that
a variety of brands within a
product category can
reduce
• Increasing generic problem
recognition generally
results in an expansion of
the total market
Selective Problem Recognition Selective Problem Recognition • Involves a discrepancy only
one brand can solve
• Firms attempt to cause
selective problem
recognition to gain or
maintain market share
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37. •
Influencing
the desired state
–
Highlight unique features
•
Influencing
perceptions
of the desired state
–
Challenge customer to re-examine the existing
state (‘good enough?’
•
Timing
problem recognition,
e.g. winter colds
Responding to consumer problems

38. Marketing Strategy and Problem Marketing Strategy and Problem Recognition Recognition Approaches to Activating Problem Recognition Approaches to Activating Problem Recognition
How can a firm
influence
problem recognition?
Recall that
problem recognition problem recognition is a function of
(1) the importance, and
(2) the magnitude
of a
discrepancy
between the
desired state desired state and an existing state
Helping Consumers Recognize Problems Helping Consumers Recognize Problems
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39. An active
attempt to
activate problem
recognition
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40. Marketing Strategy and Problem Marketing Strategy and Problem Recognition Recognition
Approaches to Activating Problem Recognition Approaches to Activating Problem Recognition Helping Consumers Recognize Problems Helping Consumers Recognize Problems
Many marketing efforts attempt to
influence the desired state
,
often advertising the benefits their products will provide and
hoping that these benefits will become desired by c onsumers.
It is also possible to influence perceptions of the existing state
through advertisements.
Critics frequently question the ethics of activatin g problem
recognition, especially for problems related to sta tus or social
acceptance.
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41. Marketing Strategy and Problem Marketing Strategy and Problem Recognition Recognition
The The
Timing Timing
of Problem Recognition of Problem Recognition
Helping Consumers Recognize Problems Helping Consumers Recognize Problems
Consumers often recognize problems at times when purchasing
a solution is difficult or impossible, such as
• deciding to purchase a generator during a hurrican e
• becoming aware of the need for health insurance af ter
being hospitalized
A common marketing strategy is to trigger problem r ecognition in
advance
of the actual problem
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42. Responding to consumer problems
(cont.) •
Suppressing
problem recognition
–
Avoid upsetting habitual buyers
–
Anticipate and counteract negatives
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43. Marketing Strategy and Problem Marketing Strategy and Problem Recognition Recognition
Suppressing Problem Recognition Suppressing Problem Recognition
Helping Consumers Recognize Problems Helping Consumers Recognize Problems
Occasionally information is introduced in the marke t place that
triggers problem recognition that some marketers pr efer to avoid.
Obviously marketers do not want their current custo mers to
recognize problems with their brands.
Effective quality control and distribution (limited out-of-
stock situations) are important in this effort.
Packages and package inserts that assure the consumer of
the wisdom of their purchase are also common.
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44. Summary of topics in this chapter
•
What is the nature of problem recognition?
•
What is the difference between habitual,
limited and extended decision making?
•
What are the key methods for measuring
problem recognition?
•
What are the uncontrollable factors that
effect problem recognition?
•
What marketing strategies can be used to
activate problem recognition?
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