Session 5

Alternative
Evaluation
& Selection
Consumer Decision Process
Evaluative criteria are the various features or benefits a consumer looks for in
response to a specific problem. They are the performance levels or characteristics
consumers use to compare different brands in view of their particular
consumption problem.
The measurement of the following is a critical first step to develop marketing strategy:

(1) which evaluative criteria are used by the consumer

(2) the relative importance of each criterion

(3) how the consumer perceives the various alternatives on each criterion (decision rules)
Techniques available to capture which Evaluative Criteria are used

1. Direct methods include asking consumers what criteria

they use in a particular purchase.
2. Indirect techniques assume consumers will not or cannot
state their evaluative criteria.
• Projective techniques - allow the respondent to indicate
the criteria someone else might use.
• Perceptual mapping - researcher uses judgment to
determine dimensions underlying consumer
evaluations.
 Projective Techniques

• Word Association Techniques

• Completion Techniques

• Construction Techniques

✓ By utilizing these projective techniques, brands can unearth nuanced consumer preferences and criteria
beyond explicit responses.

✓ Analyzing the associations, completions, and constructions provided by consumers helps brands uncover
hidden motivations and subconscious factors influencing their purchase decisions.
 Perceptual mapping

Perceptual mapping, helps you analyze visually how your target market perceives your
product or service.

Perceptual mapping is a visual representation technique used by brands to understand how consumers
perceive products or brands in relation to each other. It helps illustrate consumer perceptions and
preferences in a two-dimensional space, often based on specific attributes or criteria relevant to the product
category.

Objectives:

✓ To find out consumer evaluative criterions

✓ To understand the positioning of your product across given criterions

 Perceptual Map Techniques

Similarity Ranking Technique:

Brands could present consumers with pairs of brands (e.g., Walls ice cream compared to other ice
cream brands) and ask consumers to rank the similarity between these pairs.
Consumer is shown pairs like Quality Walls vs. Magnum, Quality Walls vs. Naturals, gyanis vs.
Naturals, etc.
They rank which brand within each pair is most similar and which is least similar, creating a ranking
order
Consumers simply rank the similarity between all pairs without specifying any evaluative criteria
or reasons , then a perceptual configuration is arrived in which these criterions are named using
judgement.

Likert Scale Responses:

Consumers could be asked to rate various ice cream brands using a Likert scale (e.g., rating from 1 to
5) based on attributes like taste, healthiness, variety, pricing, etc.
•Each brand is given scores for these attributes based on consumer responses.
•The scores are then plotted on a map, with each brand's position indicating how it's perceived
concerning these attributes. For instance, if Walls gets high ratings for taste and affordability but
lower for healthiness, its position on the map will reflect these scores.
Name the X and Y axis for the following perceptual map constructed through similarity ranking technique:

Customer
Experience

Price

What opportunities exist for new entrants?

 Creating perceptual map using Likert scale

You need to create and then interpret three perceptual maps for fast food chains. In order to create the perceptual maps, I
will provide you with an easy-to-use Excel perceptual mapping template.

Your three maps will be:

1. Healthy/Junk Food vs Wide/Limited Choice
2. Healthy/Junk Food vs For Adults/Kids
3. Wide/Limited Choice vs For Adults/Kids

Here is the data required to input into the template in order to create your three fast food perceptual maps.
Once you have created your three maps, address the discussion questions underneath.

Healthy Food (9) Junk Food (1) Wide Choice (9) Limited Choice (1) For Adults (9) For kids (1)
• McDonalds = 5.5 • McDonalds = 7 • McDonalds = 3
• Burger King = 4 • Burger King = 4.5 • Burger King= 6
• Wendy's = 7 • Wendy's = 3 • Wendy's = 7
• In & Out = 5 • In & Out = 1 • In & Out = 8
• KFC = 3 • KFC = 4 • KFC = 4
• Subway = 9 • Subway = 7 • Subway = 8
• Pizza Hut = 4 • Pizza Hut = 5 • Pizza Hut = 4
Evaluative criteria are the various features or benefits a consumer looks for in
response to a specific problem. They are the performance levels or characteristics
consumers use to compare different brands in view of their particular
consumption problem.
The measurement of the following is a critical first step to develop marketing strategy:

(1) which evaluative criteria are used by the consumer

(2) the relative importance of each criterion

(3) how the consumer perceives the various alternatives on each criterion (decision rules)
 Determination of the Relative
Importance of Evaluative Criteria

The importance assigned to evaluative criteria can be measured either by direct or

by indirect methods.

➢The constant sum scale is the most common direct method.

➢Conjoint Analysis is the most common indirect method.

➢ Constant Sum scale

[Link] Selection: Marketers select a set of evaluative criteria relevant to the product or service
being studied. These could include factors like price, quality, brand reputation, convenience,
customer service, etc.
[Link] Allocation: Respondents are given a total sum (for instance, 100 points) and asked to
distribute these points among the criteria according to their importance. They allocate more points to
the criteria they consider more critical and fewer points to less important criteria.
[Link]: After respondents allocate their points, the data is normalized to understand the
relative importance of each criterion across the entire sample
16-12
 ➢ Conjoint Analysis

Conjoint analysis is a powerful market research technique used to determine the relative
importance of different product or service attributes and to understand how consumers
make trade-offs when making decisions.

Scenario: Smartphone Conjoint Analysis

Attributes Considered:
[Link] Range: $500-$700, $700-$900, $900-$1100
[Link] Life: 1-day, 1.5-days, 2-days
[Link] Quality: 12 MP, 20 MP, 30 MP
[Link] Capacity: 64 GB, 128 GB, 256 GB

Each respondent is presented with certain prototypes and they rank them . For example, one such prototype :

Price Range: $500-$700

Battery Life: 2-days
Camera Quality: 30 MP
Storage Capacity: 128 GB
TYPES OF
DECISION
RULES
 CONSUMER DECISION MAKING RULES

➢ Compensatory Rule

➢ Conjunctive Rule

➢ Disjunctive Rule Non-compensatory

➢ Lexicographic Rule

➢ Heuristics
Higher the rating, better on that parameter
Decision Rules for Attribute-Based Choices
Compensatory Decision Rule

The compensatory decision rule states that the brand that rates highest on the
sum of the consumer’s judgments of the relevant evaluative criteria will be
chosen.

16-17
Higher the rating, better on that parameter
 Decision Rules for Attribute-Based Choices
Compensatory Decision Rule

Assume the following

importance weights:

The calculation for Dell is:

16-19
 Decision Rules for Attribute-Based Choices
Compensatory Decision Rule

Assume the following

importance weights:

Using this rule, Dell has the

highest preference and
would be chosen.

The calculation for Dell is:

16-20
 CONSUMER DECISION MAKING RULES

➢ Compensatory Rule

➢ Conjunctive Rule

➢ Disjunctive Rule Non-compensatory

➢ Lexicographic Rule

➢ Heuristics
 Decision Rules for Attribute-Based Choices

Conjunctive Rule:

Establishes minimum required performance for

each evaluative criterion.

Selects the first (or all) brand(s) that meet or

exceed these minimum standards. If minimum
performance was:

What is the choice of laptop according to this

rule?:
Hp and samsung
 CONSUMER DECISION MAKING RULES

➢ Compensatory Rule

➢ Conjunctive Rule

➢ Disjunctive Rule Non-compensatory

➢ Lexicographic Rule

➢ Heuristics
 Decision Rules for Attribute-Based Choices

Price 5
Disjunctive Rule: Weight 5

Establishes a minimum required Processor Not critical

performance for some imp attributes. If an
option meets their minimum requirements Battery life Not critical
for either of the important attributes or at
least one of the important attributes, it is After-sale support Not critical
selected.

All brands that meet or exceed the Display quality 5

performance level for any key attribute are
acceptable. If minimum performance was:
 Disjunctive Rule

Acer, Samsung, and Dell meet minimum for at least

one important criterion and thus are acceptable.

Minimum
5
5
-
-
-
5

1
 Disjunctive Rule

Acer, Samsung, and Dell meet minimum for at least

one important criterion and thus are acceptable.

Minimum
5
5
-
-
-
5

Acer, Samsung, dell

1
 CONSUMER DECISION MAKING RULES

➢ Compensatory Rule

➢ Conjunctive Rule

➢ Disjunctive Rule Non-compensatory

➢ Lexicographic Rule

➢ Heuristics
 Lexicographic Decision Rule

Consumer ranks the criteria in order of importance.

Then selects brand that performs best on the most important

attribute.

If two or more brands tie, they are evaluated on the second

most important attribute. This continues through the attributes
until one brand outperforms the others.

Acer would be chosen because it performs best on Price, our

consumer’s most important attribute.
Higher the rating, better on that parameter
 Heuristics

Heuristics are mental shortcuts or rules of thumb that people use to simplify decision-making
processes. They are cognitive strategies that help individuals quickly make judgments or decisions based
on limited information or prior experiences.

Heuristics are often efficient but can lead to biases or errors in decision-making- and that is what
sometimes the marketeers capitalise on.
 Some examples of Heuristics

Availability Heuristic: The availability heuristic is a mental shortcut in which consumers rely
on readily available information to make judgments or decisions. This information is often
recent, memorable, or easily accessible.

Anchoring Heuristic:
The anchoring heuristic is the tendency to rely heavily on the first piece of information
encountered when making decisions, even if that information is irrelevant.

Social Proof Heuristic:

The social proof heuristic involves consumers looking to the behavior or choices of others as
a guide for their own decisions. It's the idea that if others are doing it, it must be the right
choice

Scarcity Heuristic:
The scarcity heuristic is based on the idea that people tend to place higher value on items
that are perceived as rare, limited, or in high demand. Scarcity creates a perception of
exclusivity or higher quality.
 SURROGATE INDICATORS

These indicators are not direct measures of product attributes (eg, quality) but are
often relied upon as proxies for assessing product attributes that are not visible.

• Price & quality

• Product packaging & quality
• Online returns
• Length of warranty or guarantee & quality/durability

Packaging as a surrogate indicator in green marketing (perceived greenness)

Eco-friendly packaging Simple versus Elaborate packaging

CASE STUDY DISCUSSION

Formerly known as Himalaya Drug Company