BB Chapter Four : Information Search


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BB Chapter Four : Information Search

  1. 1. Chapter Four: Information Search 4-1
  2. 2. Information search An important stage of consumer decision making 4-2
  3. 3. Chapter 4: Information search 1. Nature of information search 2. Key types and sources of information 3. Difference between evoked, inept and inert sets of brands 4. Why consumers engage in information search? 5. Internet as an information source 6. Factors that affect the amount of external information search 7. Marketing strategies based on different patterns of search behavior 4-3
  4. 4. Nature of Information Search Consumers continually recognize problems and opportunities, so internal and external searches for information to solve these problems are ongoing processes. Internal Search External Search Search of long-term memory to If a resolution is not reached determine if a satisfactory through internal search, then solution is known. the search process is focused on relevant external information. 4-4
  5. 5. Information search Ongoing search or exploratory research • Search for information conducted to acquire information for later use • Because the process itself is pleasurable 4-5
  6. 6. Types of Information Sought Consumer decisions require information about: Appropriate evaluative criteria The existence of various alternatives Performance of each alternative on each evaluative criterion 4-6
  7. 7. Types of Information Sought Evaluative Criteria One potential objective of both internal and external search is the determination of appropriate evaluative criteria. criteria Government agencies and consumer organizations want consumers to use sound evaluative criteria. Marketers wanted consumer to use evaluative criteria that match their brand’s strengths. Both marketers and government agencies provide information designed to influence the evaluative criteria used. 4-7
  8. 8. Information search in consumer decisions 4-8
  9. 9. Suggesting evaluative criteria that match the brand’s strengths 4-9
  10. 10. Brands in initial awareness set 4-10
  11. 11. Types of Information Sought Appropriate Alternatives The Awareness set is composed of three subcategories of considerable importance to marketers: 1. The evoked set or consideration set contains brands or products one will evaluate. 2. The inept set consists of brands found to be completely unworthy of further consideration. 3. The inert set contains brands for which the consumer is aware of but basically indifferent toward. 4-11
  12. 12. Categories of decision alternatives 4-12
  13. 13. Types of Information Sought Alternative Characteristics To choose among the brands in the evoked set, the set consumer compares them on the relevant evaluative criteria. This process requires the consumer to gather information about each brand on each pertinent evaluative criterion. 4-13
  14. 14. Sources of Information Five primary sources of information available to consumers: Memory of past searches, personal experiences, and low- involvement learning Personal sources, such as friends, family, and others. Independent sources, such as magazines, consumer groups, and government agencies Marketing sources, such as sales personnel, websites, and advertising Experiential sources, such as inspection or product trial 4-14
  15. 15. Awareness and evoked sets for various products 4-15
  16. 16. Information sources Impersonal Personal advertising, Commercial salespeople information Non- general purpose social others commercial media 4-16
  17. 17. Information sources for a purchase decision 4-17
  18. 18. Sources of information for services 4-18
  19. 19. Sources of Information Information Search on the Internet The Internet influences search. Provides increased speed and efficiency to vast information. More efficient search and better decisions can result. However, information overload can also occur. 4-19
  20. 20. Sources of Information Information Search on the Internet Estimated Number of Internet Users by 2007 Central/South Region of the World America Asia Pacific Western Europe North America 0 100 200 300 400 500 600 Estimated Number of Users 4-20
  21. 21. Information search on the internet • 2006 survey – 64.5% of Australian population online • About 35-75% increase in online use • Internet is the most popular information source for students (2003 survey) • Over half of e-shoppers are women, taking over from males • 73% of those with Internet at work use it every morning 4-21
  22. 22. Sources of Information Top 10 Activities of Adult Internet Users E-Mail 91% Use search engine to find information 84 Search for a map or driving directions 84 Do an Internet search to answer a specific question 80 Research a product/service before buying it 78 Check the weather 78 Look for informtion on a habbyor interest 77 Get travel information 73 Get news 72 Buy a Product 67 Number represents percent who have ever engaged in the activity Source: Internet Activities (Washington, DC: Pew Internet & American Life Project, May 18, 2005. 4-22
  23. 23. Sources of Information The Nature of Search Using Online Search Engines 4-23
  24. 24. Sources of Information Information Search on the Internet There are numerous shopping services on the Internet that can: search out the lowest prices for specific items search out online retailers of specific merchandise suggest specific brands based on your prior purchases and pre-specified criteria These services use bots or shopping bots, which are bots software “robots” that do the shopping/searching for users. 4-24
  25. 25. Marketing strategy and information search on the internet Companies need to ask: – Should we have a website? – What is the purpose of the site? Information only Company and product/service information To actively attract customers A shopping site 4-25
  26. 26. Sources of Information Information Search on the Internet Three major strategic issues marketers face regarding the Internet’s role in information search and decision making: making 1. How can they drive their information to consumers? 2. How can they drive consumers to their information? 3. How (if at all) can online selling be utilized or integrated with existing channels (Chapter 17)? 4-26
  27. 27. Sources of Information Driving Consumers to a Firm’s Information Offline Media such as print and TV. Behavioral targeting involves tracking consumer click patterns on a website and using that information to decide on banner ad placement. Search engine optimization (SEO) - techniques to ensure that a company's web pages are accessible to search engines and improving the chances they are found. 4-27
  28. 28. Applications in Consumer Behavior The eBay ad shows how firms use traditional mass media advertising to drive website traffic. These materials have been reproduced with the permission of eBay Inc. COPYRIGHT ©EBAY INC. ALL RIGHTS RESERVED. 4-28
  29. 29. Sources of Information Driving Consumers to a Firm’s Information Website design is also critical. Ongoing and repeat traffic requires relevant and frequently updated content. Consumers need ongoing incentives to return such as: •product-related news features •user-related discussion forums •updates on new products Firms use various incentive techniques to encourage repeat traffic 4-29
  30. 30. Amount of External Information Search Marketers are particularly interested in external search, as this provides them with direct access to consumers. Most purchases involves limited external search immediately prior to purchase. However, this does not mean a bad judgment on part of consumers since they are balancing the costs and benefits of search. 4-30
  31. 31. Amount of external information search • Measures used: – No. of stores visited – No. of alternatives considered – No. of personal sources used – Overall or combination measures 4-31
  32. 32. Classification of searchers • Non-searchers • Limited information searchers • Extended information searchers 4-32
  33. 33. Amount of external search for appliances 4-33
  34. 34. Information sources used to select professional services 4-34
  35. 35. Costs vs. benefits of external search 4-35
  36. 36. Costs vs. Benefits of External Search Market Characteristics Product Characteristics Consumer Characteristics Situation Characteristics 4-36
  37. 37. Costs vs. Benefits of External Search Market Characteristics Market characteristics include the number of alternatives, price range, store distribution, and information availability. Consumer perceptions of the market characteristics, not the actual characteristics, influence shopping behavior. The greater the number of alternatives available to resolve a problem, the more external search there is likely to be. 4-37
  38. 38. Factors affecting external search Influencing factor Increasing the factor causes search to: 1. Market characteristics a) No. of alternatives Increase b) Price range Increase c) Store distribution Increase d) Information availability Increase i) Advertising ii) POP Displays iii) Sales personnel iv) Packaging v) Experienced consumers vi) Independent sources 4-38
  39. 39. Newspaper ads increase readers’ awareness of sales and in-store promotions 4-39
  40. 40. Costs vs. Benefits of External Search Product Characteristics Product differentiation is associated with greater external search. And, positive products tend to engender greater search than negative products. Shopping for a physician can be be unpleasant, and thus, seen as a negative product 4-40
  41. 41. Factors affecting external search (cont) Influencing factor Increasing the factor causes search to: 2. Product characteristics a) Price Increase b) Differentiation Increase c) Positive products Increase 4-41
  42. 42. Costs vs. Benefits of External Search Consumer Characteristics A variety of consumer characteristics affect perceptions of search costs and benefits. Confidence in one’s knowledge of existing solutions is an important determinant. However, consumers often do not know what they think they know! 4-42
  43. 43. Costs vs. Benefits of External Search Consumer Characteristics There are a variety of types of knowledge where a low level of calibration frequently occurs to the detriment of consumers and firms, including Memory of Facts Memory of Events Belief Polarization Belief Validity Personal Forecasts 4-43
  44. 44. Costs vs. Benefits of External Search Consumer Characteristics Consumer Perception of Risk associated with unsatisfactory product performance increases information search. Perceived risk is high for products whose failure to perform as expected would result in a high • Social cost • Financial cost • Time cost • Effort cost • Physical cost 4-44
  45. 45. Factors affecting external search (cont) Influencing factor Increasing the factor causes search to: 3. Consumer characteristics a) Learning and experience Decrease b) Shopping orientation Mixed c) Social status Increase d) Age, gender, household Mixed lifecycle e) Product involvement Mixed f) Perceived risk Increase 4-45
  46. 46. Costs vs. Benefits of External Search Situation Characteristics Situational variables can have a major impact on search behavior including the following: Temporal perspective Task definition Antecedent state Physical surroundings Social surroundings 4-46
  47. 47. Factors affecting external search (cont) Influencing factor Increasing the factor causes search to: 4. Situational characteristics a) Time availability Increase b) Purchase for self Decrease c) Pleasant surroundings Increase d) Social surroundings Mixed e) Physical / mental energy Decrease 4-47
  48. 48. Marketing Strategies Base on Information Search Patterns Sound marketing strategies take into account the nature of information search prior to purchase. Two dimensions of search are particularly appropriate: 1. The type of decision influences the level of search, and 2. The nature of the evoked set influences the direction of the search 4-48
  49. 49. Marketing strategies based on information-search patterns Target market decision making pattern Habitual decision Limited Habitual making decision decision Brand position (no search) making making (limited search) (extensive search) Maintenance Capture Preference Brand in strategy strategy strategy evoked set Disrupt strategy Intercept Acceptance Brand in not strategy strategy evoked set 4-49
  50. 50. Strategies (in evoked set) • Maintenance strategy – Defend against disruptive tactics – Constant activity + interest • Capture strategy – Constant supply + quality – Continue limited search • Preference strategy – Search locations must be anticipated, e.g. chemists – POP + sales assistance – Know where they search 4-50
  51. 51. Marketing Strategies Based on Information Search Patterns Maintenance Strategy If the brand is purchased habitually by the target market, the marketer’s strategy is to maintain that behavior This requires consistent attention to product quality, distribution, and a reinforcement advertising strategy. Del Monte has large repeat purchaser segments for their canned vegetables which they successfully maintain 4-51
  52. 52. Marketing Strategies Based on Information Search Patterns Capture Strategy Limited decision making generally involves a few brands evaluated on only a few criteria. Brand is in evoked set. Search occurs mainly at the point-of-purchase or in readily available media. Objective is to capture as large a share as practical. 4-52
  53. 53. Marketing Strategies Based on Information Search Patterns Capture Strategy The marketer will want to supply information, often on price and availability, on their website, in local media through cooperative advertising, and at the point-of-purchase through displays and adequate shelf space. Implementing a capture strategy also requires emphasis on maintaining consistent product quality and adequate distribution 4-53
  54. 54. Marketing Strategies Based on Information Search Patterns Preference Strategy Extended decision making with the brand in the evoked set requires a preference strategy. A simple capture strategy not likely adequate. Instead, marketer needs to structure information so brand becomes preferred by target market. 4-54
  55. 55. Firms use a capture strategy when the brand is within the market’s evoked set. 4-55
  56. 56. Strategies (not in evoked set) • Disrupt strategy – Attention-seeking ads – Free samples or bonus encouraging trial • Intercept strategy – Must attract attention – POP display – Product improvements, etc. • Acceptance strategy – Advertise but don’t ‘sell’ the brand – Encourage consumer to seek information 4-56
  57. 57. Marketing Strategies Based on Information Search Patterns Disrupt Strategy If the brand is not part of the evoked set and the target market engages in nominal decision making, the marketer’s first task is to disrupt the existing decision pattern. Soy products are a good example of how disrupt strategies have been used to induce trial adoption. 4-57
  58. 58. Marketing Strategies Based on Information Search Patterns Disrupt Strategy Long-Run Short-Run Major brand improvement Attention-attracting along with attention- advertising aimed attracting advertising specifically at breaking could shift consumer to habitual decision making more extensive decision can be successful. making. 4-58
  59. 59. Marketing Strategies Based on Information Search Patterns Disrupt Strategy Tactics include: Free samples, coupons, rebates, and tie-in sales. Striking package designs and point-of-purchase displays. Comparative advertising. 4-59
  60. 60. Firms engage in a disrupt strategy to disturb the habitual decision process of competitor’s customers 4-60
  61. 61. Marketing Strategies Based on Information Search Patterns Intercept Strategy If limited decision making and brand is not part of evoked set, objective will be to intercept the consumer during search. Emphasis will be on local media, point-of-purchase displays, shelf space, package design, etc. Coupons can also be effective. 4-61
  62. 62. Marketing Strategies Based on Information Search Patterns Acceptance Strategy Similar to preference strategy, but complicated by fact that target market is not seeking information about the brand. Beyond preference strategy, marketer must attract consumer attention or motivate brand learning. Incentives to try product, long-term advertising to enhance low-involvement learning and use of the Internet are useful for gaining acceptance. 4-62
  63. 63. Summary of topics in this chapter • What is the nature of information search? • Key types and sources of information? • Difference between evoked, inept and inert sets of brands • Why consumers engage in information search? • How is the internet used as an information source? • What factors affect the amount of external information search? • How can marketing strategies be based on different patterns of search behavior? 4-63