26: Consumer Decision Making As Heuristics
The term "heuristics" has become clouded by popular misuse, and is inherently vague as it refers to any technique used for analysis, evaluation, classification, and judgment. To clarify, the author uses the term to mean "simple decision rules."
An example to illustrate the concept is of a triage nurse diagnosing a patient and deciding on a course of treatment: there is a short list of questions that can be considered for a patient who is having abdominal pains: what has the patient eaten lately? Is there any visible swelling or distention? Is the pain localized to a specific area? Are there any contusions or external signs of injury? While the doctor may wish to do a more detailed diagnosis including x-rays and blood work, considering the answers to these questions will enable the triage staff to make a preliminary diagnosis, decide if further testing is necessary, and begin a course of treatment (or avoid things that might do harm) while waiting on the results of more time-consuming tests.
The benefit of heuristics is efficiency - to assess a probable cause and begin working quickly. The trade-off is that a superficial decision may not be accurate when additional information is discovered.
The consumer in the marketplace, like the doctor in the clinic, decides how serious the situation is and accords to it a corresponding amount of diagnostic effort. While the consequences of a buying decision are seldom as dramatic or dire as a triage, some are more important than others in terms of the impact to the customer, and the vast majority are trivial and don't merit much consideration beyond a basic rule-set.
Neuromarketing And Heuristics
The author returns to brain physiology - specifically, the way in which sensations and gestalts have associated levels of dopamine that can be triggered merely by considering how we would feel about taking an action. This is essential to heuristics.
When faced with a choice between products on a shelf, the immediate reaction is to select the one that the customer "feels best" about - which is to say, the one to which the prospect of selection, ownership, or utilization evokes the strongest dopamine reaction. The first and foremost questions we consider are thus:
- What do I expect based on past experiences with this brand?
- What do I expect based on immediate sense-data?
- What do I expect based on what others have told me?
Each of these is an assessment of the gestalt, where positive feelings (somatic markers, dopamine levels) are evoked by expectations of experience.
What constitutes a positive expectation depends on highly subjective factors. Will I save money? Will I enjoy using the product? Will others approve of the decision I have made?
(EN: All of this pertains to positive expectations, and I sense the author overlooks negative ones: will I regret doing this? Granted, you may consider it a comparison against the alternative - doing this will create less dopamine than not doing it, and therefore I should refrain - but my sense is that negative expectations, regret, is a thing unto itself rather than merely being "less positive" than its opposite.)
There will be occasions when the customer with "think really hard" about a purchase - when an item costs a lot of money, when he is unfamiliar with the product, when he expects the purchase to have a large or lengthy impact on his life - and apply a more extended set of heuristics. But for most purchases, it's short and simple.
There are instances in which a person will invest cognition in a seemingly simple purchase - though the truth is that "simple" is relative to the consumer. Decisions that seem simple, not meriting much effort, could become the subject of intense consideration depending on an individual's situation: a man who has just lost his job might be conflicted over the decision of what brand of soup to buy; a woman who is going on a job interview might fret over the choice of a shade of lipstick. To most people, and even to the same people under different circumstances, these would be minor purchases that require little thought.
While the process of a labored decision is more rational, pertaining to frontal-lobe activity, the emotional reactions we have to a stimulus (given the context of our situation, personality, mood, etc.) are what drive us to apply our rational faculty, and determine the degree to which active cognition is engaged - whether a decision is made based on short and simple heuristics or greater deliberation is undertaken.
Brand Dynamics
While customers in general refer to heuristics in making purchasing decisions, the precise heuristic model is largely individual to the consumer: each person considers different attributes, and fives them different degrees of importance. When we analyze data in the aggregate, the subtleties will be hidden.
The Brand Dynamics model (Hollis ad Farr) is based on the idea that, while the specific attributes are important to the purchasing customer, what is important to the marketer is whether there is "something" about the brand that appeals to a given customer, whatever that may be. If we ask "which of the available brands best satisfies your needs," this provides very good data without identifying what the specific need-attribute consideration is.
This model results in a simple heuristic that can be applied to every consumer and every brand as a measure of the extent to which the customer may be considered to be "bonded" to that brand. Specific components of this consideration are:
- Presence: The customer is aware of the brand (when told the product category), has familiarity with the brand promise, or has used the brand.
- Relevance: The customer believes the brand to be capable of delivering something of value that is worth the cost and effort to obtain it.
- Performance: The customer does not perceive any barriers to obtaining the value promised by the brand.
- Advantage: The customer believes the brand to be better than alternatives in one or more ways.
- Bonding: The customer believes the brand to be "the best" among its alternatives.
A common problem for researching brand preferences is that customers are vague about the reasons for choosing a given brand. "I like it" seems like a fairly useless piece of information, but it reflects reality and the simple heuristic the customer users. If the researcher then problems the customer to get at more specific reasons the consumer likes it, the probability of confabulation increases drastically.
Conversely, when researchers ask customers why they do not buy a given brand, the answers are along the lines of "I don't know it" (no presence); I wouldn't need it (no relevance); "It's not available in local stores (no performance), or "It's not as good as my usual brand" (no advantage, and certainly no bonding). This, too, seems simple, but their initial response indicates the level at which the brand has failed to connect to the customer.
The author concedes that the Brand Dynamics model was developed before the idea of soma became popular, but its outcome is to detect the customer's general impression of a brand and their feelings toward it.
Situational Heuristics
People do not purchase the same products and brands with perfect consistency, and this largely arises from the application of different heuristics in different situations.
Take the example of beverages: a person might purchase beer for a barbecue, wine for a dinner, or liquor for a cocktail party. Even within a more narrowly-defined category such as wine, the brand ordered at a restaurant will depend on whether they are having a glass with lunch, entertaining friends, or dining with clients.
Joel Dubow studied this phenomenon in 1992, and used the term "occasion segmentation" to describe the way in which the situation in which a product will be used influences product and brand choices.
In the author's own experience, he has attempted to consider occasion when asking about brand preference, but this often means that the questionnaire becomes "ridiculously long" and repetitive. It's often necessary to ask about a given occasion to discover brand, or ask which occasions a brand to which a given brand might be better suited.
(EN: And it's likely worth mentioning this could be the cause of much inaccuracy in research - that is, if you ask the question in general, the respondent will likely imagine the scenario. Such that if you ask a person outdoors, in summer, just before lunch, they will indicate a brand preference that is different to what they would choose indoors, in winder, just after consuming a heavy meal. To assume one answer is "right" for all occasions is to generalize.)
Heuristics And Questionnaire Design
While few people are eager to participate in research, it's fair to say that they are "not unhappy" to answer questions and can be counted upon to share an honest opinion. The chief problem is questionnaire design, which leads people to be reluctant to share information, or take greater interest in providing the answer that will bring the interrogation to the fastest possible conclusion.
Chief among these problems are that nearly all questionnaires are too long. The interviewer tricks subjects into participating by telling them it won't take very long, then the subject, then is trapped in an interminable queue of repetitive and obtuse questions. The frequency with which this occurs has made the general population reluctant to participate and even hostile to the prospect of being surveyed.
While it is generally known and accepted that this is a dishonest practice that provides unreliable results, there seems to be a belief on the part of researchers or research sponsors that they need to ask as much as possible, whether it's because every little question seems important, or because they want to get the most from their research dollar.
Surveys into brand heuristics are notoriously onerous. To ask about a dozen attributes for ten different brands results in a 120-question survey that is extremely repetitive (do you think if brand A as being affordable? Do you think of brand B as being affordable? Do you thin of brand C as being affordable? Do you think of brand D as being affordable? And so on.)
What's more, the situation seems stupid and absurd, which causes people to give stupid and absurd answers. The author speaks of his own exasperation at having to fill out a security questionnaire each time he enters a building - and so, for "the past few years," he as responded to the question about the purpose of his visit as "to plant a bomb." During that time, he has never been stopped.
Moreover, the findings of the research into consumer behavior suggests that most surveys are entirely wrong-headed: most purchasing decisions are made quickly, based on emotional reaction rather than reason, and so on. The process of answering a survey, delving into detail about the most minute qualities and giving each careful consideration, is completely unlike the decision-making process, meaning that the results of a survey that intends to consider consumer behavior and buying decisions, by design, is far removed from the actual behavior of consumers in actual buying situations.
Where Does This Lead Us (Marketers)?
Even knowing this, marketers and researchers cling to research methods they know are flawed for lack of anything better to substitute. (EN: Or more likely, because they are themselves meeting the expectations of a sponsor who is paying for research, and has certain expectations about the kind of information the researcher will provide. Having shelled out tens of thousand of dollars, what sponsor would be happy to hear "people like your product, in a general way.")
It's here that technology provide an advantage. Not only is it cheaper to conduct research, but there is a much larger audience of prospective respondents, such that an extensive research project that seeks answers to five hundred questions need not subject every respondent, but merely divide the questionnaire into fifty ten-question subsets and ask more people.
The intelligence of dynamic questionnaires is also mentioned, which enables us to change the questions asked based on responses previously given, such that a subject need no suffer through several questions that the researcher should know to be irrelevant based on their previous answers.
While the computer intelligence to do so has been around for decades, the design intelligence is sadly lacking. Even when surveys are conducted with paper forms, the interviewer seldom shows the sense to skip those that he knows are not pertinent, and instead marches an increasingly-annoyed subject through a long list of pointless questions.
Aside of the problem of annoying individual respondents and creating negative sentiment toward market research in general, poorly-designed surveys create bad and inaccurate results for the researcher and sponsor.
Ultimately, the solution to the problem is self-evident: use shorter and more thoughtfully designed surveys.