CH-10 Post-Decision Processes – Consumer Behavior : Book Guide

Chapter 10 Post-Decision Processes CHAPTER SUMMARY This chapter examines some of the major processes that occur after a decision has been made. Consumers sometimes develop post-decision dissonance—a feeling of anxiety or uncertainty regarding a decision. Consumers are motivated to reduce dissonance by collecting additional information that is used to upgrade the chosen alternative and downgrade rejected ones. Post-decision regret is formed when the consumer feels that the wrong purchase decision was made. Consumers can learn from experience through a process of hypothesis testing in which they attempt to either confirm or disconfirm expectations by actually engaging in acquisition, consumption, or disposition. This process is influenced by motivation, prior knowledge or ability, ambiguity of the information environment or lack of opportunity, and two types of biases, the confirmation bias and overconfidence. Marketers can use several strategies to influence the learning process, depending on whether the offering is a top dog or an underdog. Satisfaction is both a subjective feeling and a positive evaluation that a decision has fulfilled a need or goal. Dissatisfaction occurs when there are negative feelings and an evaluation that goals or needs have not been fulfilled. It is important for marketers to keep consumers satisfied because losing customers can be very costly in the long run. Three major theories of satisfaction/dissatisfaction are (1) the disconfirmation paradigm, which states that satisfaction occurs when performance disconfirms expectations in a positive way and that dissatisfaction results from negative disconfirmations; (2) attribution theory, which states that dissatisfaction results when the cause of a problem is determined to be permanent, marketer-related, and under volition; and (3) equity theory, which states that satisfaction results when the buyer perceives fairness in the exchange. Three major ways that consumers can respond to dissatisfaction are (1) complaining (2) responding to service recovery efforts, and (e) engaging in negative word of mouth (WOM). Customer satisfaction may not be enough to prevent defections to competitors’ brands. Customer-retention strategies attempt to build customer loyalty. Finally, consumers can dispose of products in a variety of ways. This process has important implications for marketing strategy and an understanding of consumer behavior. Recycling, which is one form of disposition, is dependent on consumers’ motivation, ability, and opportunity to act. CHAPTER LEARNING OBJECTIVES After studying this chapter, students will be able to 1. Distinguish between the dissonance and the regret that consumers may experience after acquisition, consumption, or disposition. 2. Explain how consumers can learn from experience and why marketers need to understand this post-decision process. 3. Discuss how consumers judge satisfaction or dissatisfaction with their decisions about acquisition, consumption, or disposition. 4. Describe how consumers may dispose of something, why this process is more complex for meaningful objects, and what influences consumer recycling behavior. CHAPTER OUTLINE I. Post-Decision Dissonance and Regret A. Dissonance 1. Uncertainty as to whether one made the right decision 2. Most likely to occur when there is more than one attractive alternative and the decision is important B. Regret 1. Occurs when consumers perceive an unfavorable comparison between the performance of the chosen option and the performance of unchosen options. C. Marketing Implications 1. By reducing post-decision dissonance and regret, marketers can diminish negative feelings related to the product or service. II. Learning from Consumer Experience A. A Model of Learning from Consumer Experience 1. Consumers can learn from experience by engaging in hypothesis testing a) On the basis of past experience or on information from some source b) Consumers form a hypothesis or expectation about a product or service, consumption experience, or disposition option, and then set out to test it. c) Four basic stages in testing hypotheses for learning (1). Hypothesis generation (2). Exposure to evidence (3). Encoding of evidence (4). Integration of evidence and existing beliefs B. What Affects Learning? 1. Motivation a) When consumers are motivated to process information, they will generate a number of hypotheses; when motivation is low, few or no hypotheses will be generated. 2. Prior Knowledge or Ability a) When knowledge or ability is high, consumers are likely to have well-defined beliefs and expectations and therefore will be unlikely to generate new hypotheses. 3. Ambiguity of the Information Environment or Lack of Opportunity a) Experience does not provide information that confirms or disconfirms the hypothesis. 4. Processing Biases a) Inhibit learning by making consumers avoid both negative and highly diagnostic information b) Types of processing biases (1). Confirmation bias (2). Overconfidence bias 5. Marketing Implications a) Ambiguous information and processing biases often inhibit consumer learning about products and services, which have important strategic marketing implications. b) Top-dog strategies occur when a product or service is the market leader or has a strong share. (1). Consumers will tend simply to confirm beliefs and expectations, so consumers are less likely to learn new information that will lead to brand switching. c) Underdog strategies occur when lower-share brands have everything to gain by encouraging consumer learning because new information may lead to switching. (1). Underdogs need to facilitate comparisons with the market leader. (2). Facilitating product trials is crucial. III. How Do Consumers Make Satisfaction or Dissatisfaction Judgments? A. Consumers evaluate the outcomes of their decisions. 1. If they feel their needs or goals have been met, they are satisfied. 2. If they have a negative evaluation, they will be dissatisfied. 3. Consumers can evaluate in terms of: a) Utilitarian dimensions (how well the product/service functions) b) Hedonic dimensions (how it makes one feel) 4. Levels of satisfaction can vary by involvement and over time. 5. Marketing Implications a) Satisfied customers form the foundation of a successful business because satisfaction leads to repeat purchase, brand loyalty, and positive WOM. B. Satisfaction/Dissatisfaction Based on Thoughts 1. Expectations and Performance: The Disconfirmation Paradigm a) Disconfirmation occurs when there is a discrepancy between prior expectations and actual performance. Disconfirmation may be positive or negative. b) Expectations are desired product/service outcomes. c) Satisfaction based on expectations (1). Performance measures whether expected outcomes have been achieved. (2). If performance is better than expected, a positive disconfirmation has occurred and satisfaction results. (3). If performance is as good as expected, a simple confirmation has occurred, also leading to satisfaction. (4). If performance is lower than expected, negative disconfirmation and dissatisfaction results. d) Other influences on satisfaction (1). Performance, expectations, and feelings can affect satisfaction, independent of disconfirmation. e) Satisfaction or dissatisfaction are important to the learning process because they provide information. (1). Satisfaction levels are subject to change (2). May not be transaction-specific (3). May be related to outside factors inconsequential to the transaction f) Marketing Implications (1). Raising consumers’ expectations of how well a product or service will perform can increase ratings of product performance. 2. Causality and Blame: Attribution Theory a) In a marketing context, the consumer will attempt to find an explanation as to why a product or service does not fulfill his or her needs. b) Three key factors influence the nature of this explanation: (1). Stability (2). Focus (3). Controllability c) Marketing Implications (1). Attribution theory can provide guidance on how to deal with potential or existing perceptions of consumer dissatisfaction. (2). If dissatisfaction is real and permanent, something must be done to correct problems or provide restitution. (3). If dissatisfaction is perceived, marketers can correct misperceptions. 3. Equity Theory a) Examines the exchange between a buyer and a seller b) The buyer must perceive that there is fairness in the exchange. c) Marketing Implications (1). When consumers perceive that their inputs and outputs are equitable in relation to those of the seller, satisfaction results. (2). Salesperson-customer interactions and promotions can affect consumers’ perceptions of fairness in an exchange. C. Satisfaction/Dissatisfaction Based on Feelings 1. Experienced Emotions and Coping a) Consumers experience positive and negative post-decision feelings, independent of disconfirmation. b) If consumers feel good using a product, they are more likely to be satisfied. c) Consumers who are dissatisfied with a purchase, consumption or disposition decision may need to cope with feelings of stress that dissatisfaction involves. 2. Mispredictions about Emotions a) The difference between consumers’ affective forecasting and the actual consumption experience can lead to dissatisfaction. 3. Marketing Implications a) Marketers should use promotions to create positive feelings about their brands. b) Marketers can help consumers cope with stress by providing a feedback mechanism and by making expert advice available. IV. Responses to Dissatisfaction A. Complaints 1. Indicate marketing-related problems that need attention 2. When complaints are likely to occur a) When motivation, ability, and opportunity are high b) When the level of dissatisfaction, severity of problem, or perception of unfairness of the exchange increases 3. Complainer types a) Passives are least likely to complain. b) Voicers complain directly to retailer or service provider. c) Irates spread negative WOM, stop patronage, and complain to the provider. d) Activists engage in all types of complaining, including to a third party such as the media or government. 4. Marketing Implications a) A large percentage of consumers do not complain, but it is in the marketer’s best interest to be responsive when they do. b) Sometimes complaining should be encouraged because problems can be corrected and valued customers retained. B. Responding to Service Recovery 1. If customers are dissatisfied, marketers need to find ways of making up for this dissatisfaction to win back customers’ business. 2. Marketing Implications a) Consumers prefer service recovery efforts that correspond to the type of failure experienced. C. Responding by Negative Word of Mouth 1. Negative WOM is more likely to occur when the problem is severe, consumers are unhappy with the company’s responsiveness, and consumers perceive the company is at fault. 2. Negative WOM tends to be highly persuasive and very vivid, and consumers place great emphasis on it when making decisions. 3. Marketing Implications a) Marketers need to respond to negative WOM by trying to identify the reason or source of the difficulty so steps can be taken to rectify or eliminate the particular problem. V. Is Customer Satisfaction Enough? A. Customer satisfaction may not be enough to prevent defections to competitors’ brands. B. Customer-retention strategies attempt to build customer commitment and loyalty. 1. Marketing Implications a) Marketers should take the following steps to retain customers (1). Care about customers (2). Remember customers between sales (3). Build trusting relationships (4). Monitor the service-delivery process (5). Provide extra effort VI. Disposition A. The many ways we can dispose of something 1. Disposition is the simple throwing away of meaningless or used-up items without any thought. 2. Possessions may be an extension of self, thus complicating disposition decisions 3. Disposition may be voluntary or involuntary, permanent or temporary. 4. When a possession is no longer of use, consumers can: a) Give it away b) Trade it c) Recycle it d) Sell it e) Use it up f) Throw it away g) Abandon it h) Destroy it B. Disposing of Meaningful Objects 1. Physical detachment is the process in which an item is physically transferred to another person or location. 2. Emotional detachment is a more lengthy, detailed, and sometimes painful process. 3. Marketing Implications a) Disposition decisions often influence later acquisition decisions. b) Consumers increasingly choose to sell or trade old items rather than throw them away. c) Disposition behaviors can sometimes have a major impact on society in general, as with anti-litter campaigns. d) Disposition patterns can sometimes serve as economic indicators. C. Recycling 1. Motivation to Recycle a) Consumers are more likely to recycle when perceived benefits outweigh costs. 2. Ability to Recycle a) Consumers are more likely to recycle when they know how to do it. 3. Opportunity to Recycle a) If recycling procedures are difficult, consumers will usually avoid doing it. 4. Marketing Implications a) Marketers can facilitate recycling by increasing consumers’ motivation, ability, and opportunity to recycle. QUESTIONS FOR REVIEW AND DISCUSSION Possible answers are as follows. 1. How does post-decision dissonance differ from post-decision regret, and what effect do these have on consumers? Answer: Post-decision dissonance and regret are a matter of degree. Dissonance is the feeling of anxiety or uncertainty that the correct decision was made. Regret is a stronger feeling that one has made the wrong purchase decision. Dissonance has a better chance to be contained by a marketer as they attempt to reduce this feeling of uncertainty. Regret is likely to have a stronger, longer-lasting, negative effect on the consumer. 2. Describe how consumers acquire information about goods and services by learning from experience with them. Answer: Experiences that occur during consumption or disposition can be an important source of information to the consumer. Experiencing an event is more involving and interesting than learning about it through information search (e.g., talking to friends, reading about it on the Internet). Additionally, information acquired from experience is more vivid to the consumer and is easier to remember than other types of information. Finally, information about attributes that must be experienced through taste, touch, or smell exert a stronger influence on consumers’ future behavior when it comes from experience or product trial than when it comes from advertising or word-of-mouth. 3. How do expectations and performance contribute to disconfirmation? Answer: Disconfirmation is any discrepancy between what a consumer expects from a given consumption experience and the actual performance of the consumption experience. When expectations are exceeded by performance, this results in positive disconfirmation known as satisfaction. When performance fails to meet expectations, a negative disconfirmation, or state of dissatisfaction, occurs. 4. Define attribution theory and equity theory, and explain how they relate to dissatisfaction. Answer: Attribution theory demonstrates how individuals explain events. It is based on the factors of stability, focus, and controllability. If the cause of the dissatisfaction with a product or service is permanent, marketer related, and under the marketer’s control, then consumers will likely be dissatisfied with the consumption experience. If, for example, the dissatisfaction is not seen as the fault of the marketer, happens very rarely, or is out of the control of the marketer, then consumers are less likely to be dissatisfied with the product or service. Equity theory is a theory that focuses on the fairness of exchanges between individuals. If consumers perceive inequity in the exchange that does not benefit the consumer, dissatisfaction will likely occur. Fair exchanges, as defined by the consumer, likely lead to satisfaction with the exchange. 5. What is the role of feelings in influencing satisfaction and dissatisfaction? Answer: Feelings are a part of the acquisition, usage, and disposal process. Feelings after consumption and or disposal contribute to an evaluation. In some cases, a feeling of regret, or buyers’ remorse can work alongside dissatisfaction. In other cases, a feeling of buyers’ remorse can work with satisfaction, in that the consumer regrets not buying more of the offering that they were very satisfied with. Marketers should make sure that customers’ feelings about trying, buying, and using the products are positive so that they positively impact satisfaction and negatively impact dissatisfaction. 6. Why is complaining important to marketers, and how should complaints be handled? Answer: Marketers should make sure that customers’ feelings about buying and using their offerings are as positive as possible. Customer satisfaction leads to repeat purchase, brand loyalty, and positive word of mouth. If the customer is dissatisfied, the marketer must seek to correct the problem as soon as possible in order to lower post-decision dissonance and regret and diminish any negative feelings related to the product or service. Solving a customer problem quickly and completely helps consumers develop a positive attitude and to feel better about the purchase. 7. What influence can experienced emotions and mispredictions about emotions have on consumer satisfaction or dissatisfaction? Answer: The emotions consumers experience when using a product can definitely affect whether they are satisfied with a purchase. Consumers often make an affective forecast, predicting how they will feel when consuming a product. If the actual experience does not equal the affective forecast, consumers may feel a level of dissatisfaction. 8. In what eight ways can consumers dispose of something? Answer: To dispose of an item, consumers can give it away, exchange it for something else, recycle it, sell it, use it up, throw it out (socially acceptable), abandon it (socially unacceptable), or destroy it. 9. Why is it important for marketers to consider both physical and emotional detachment aspects of consumer disposition? Answer: Disposition decisions often influence later acquisition decisions because a consumer who decides to dispose of a particular item often acquires another. In addition, product disposition behaviors can sometimes have a major impact on society in general. Finally, by examining broad disposition patterns, we can gain marketing insights that might not otherwise have been possible. In short, possessions can define an individual and the emotional detachment may be a more extensive process than the physical separation. CONSUMER BEHAVIOR CASE What to Do with Old Cell Phones? Every year, millions of consumers answer the call to upgrade their cell phones—and that means deciding what to do with the used cell phone being replaced. Some people reuse their cell phones by giving them to another family member or saving them in case the new phone happens to break. Others simply toss their old cell phones into the trash, even though such electronics have materials that shouldn’t be in landfills. What else can consumers do with their old phones? One option is to trade it in. Retailers such as Target, Costco, Radio Shack, and Amazon.com have trade-in programs that give consumers store credit for used cell phones in decent shape. Another option is to sell the old phone. Sometimes the sale is to an individual, handled privately or via sites such as eBay. More often, consumers prefer the convenience of selling to a business that refurbishes and resells electronic goods (or recycles them responsibly if they have no resale value). Michigan-based ReCellular is among the market leaders in this industry, with $100 million in annual revenue. Consumers click to the company’s web site, look up the phone’s make and model, indicate the condition of the phone, and see how much ReCellular will pay for it. To complete the transaction, they download a prepaid shipping label and send the phone to ReCellular, which confirms the condition and then mails payment. The company deletes any personal data, makes any needed repairs, replaces worn or missing parts, tests the phones to ensure they’re in good working order, and then sells them to consumers in domestic and international markets. Businesses like ReCellular are thriving as the world emerges from recession and consumers seek to cash in on unused goods. Today’s cell phones are more sophisticated than the phones of just a few years ago, which means they’re worth more when sold. Even basic models can fetch some money because there is always some level of demand for low-priced, no-frills used phones. ReCellular handles more than five million old phones every year, selling more than half of its refurbished units to U.S. consumers and the remainder to distributors in developing countries. There are also other disposition possibilities for old phones. A growing number of nonprofits are appealing for used cell phones they can sell to raise money for worthy causes. Hope Phones and several other groups recently banded together to collect 20,000 used cell phones, with the goal of buying prenatal medical equipment to use in Nepal and the Democratic Republic of Congo. “If you can help save a woman and give her a chance to have a healthy baby by simply donating a phone,” says a manager at the United Nations Foundation, which is involved in the effort, “that’s a powerful opportunity for you to engage and connect with someone else.” Cell Phones for Soldiers, founded in 2004, asks consumers to donate used cell phones as a fundraiser for buying phone cards for U.S. military members stationed far from home. The 2,000 U.S. AT&T stores are among the many collection points, and AT&T provides free downloadable shipping labels for consumers who can’t get to a store to drop off phones in person. Every year, the charity raises enough money to send phone cards with a combined value of more than 10 million minutes of talk time so American men and women in uniform all around the world can call family and friends for free. In the end, whether reused, resold, recycled, or donated, outdated cell phones have a value and a future somewhere in the world. Case Questions 1. The quote from a U.N. Foundation manager talks about donating a cell phone as a “powerful opportunity . . . to engage and connect with someone else.” Does this quote refer to motivation, ability, or opportunity to recycle a cell phone by donating it? Explain your answer. Answer: Motivation, the manager is trying to highlight the benefits of choosing donation over selling one’s old phone. He emphasizes the positive impact on populations in need, being a part of a larger global community, and the positive feelings for oneself by doing something good for others. 2. How do the concepts of physical and emotional detachment apply to the way consumers decide to dispose of their used cell phones? Answer: In terms of physical detachment, the easier a company makes disposing of the phone the better, as ReCellular does by providing mailing labels consumers can print from home. Consumers who have an emotional attachment to their phone may find it easier to donate their used cell to a good cause, making the detachment process more meaningful. 3. Why would Amazon.com, which has no physical retailing presence, be as interested in encouraging cell phone trade-ins as Radio Shack and Target? Answer: Disposition decisions can often impact future acquisition decisions; Amazon.com wants consumers to think of their company as a potential source for buying a new cell phone in the future. 4. Once consumers have sold their used phones to a company like ReCellular, how is learning likely to affect their beliefs about this disposition option? Answer: If they have a good experience and feel like they are getting a fair amount of money for their old phones, they will likely believe this is a good option for disposing of their cell phone again in the future. SUGGESTED EXERCISES AND TEACHER GUIDELINES 1. Pick five durable or nondurable product or service categories. Develop a set of questions to ask consumers to tell (1) how satisfied they are with the offerings in each category, (2) recall any instances when they have been dissatisfied in the past, (3) indicate how they dealt with the situation when they were dissatisfied, and (4) identify how they felt about the company or retailer response (if any). Administer this questionnaire to at least 15 consumers. Based on the data, try to answer the following questions: (a) With what types of products or services are consumers most satisfied? (b) For what products or services are consumers most dissatisfied? Why do you think this is the case? (c) What are the most common responses to dissatisfaction? (d) How well have the companies handled dissatisfaction? Ask students to consider different avenues of interacting with companies when a state of dissatisfaction occurs (e.g., Internet, in person, telephone, mail). What effects do the different avenues have on the consumer’s evaluation of the attribution process? Does speaking with an individual reduce dissatisfaction? Does a prompt e-mail from the company reduce dissatisfaction? Can complaints be solved via email, or is it better for companies to contact the consumer personally? Answer: Product Categories: 1. Smartphones 2. Grocery Delivery Services 3. Airline Travel 4. Streaming Services 5. Washing Machines Questionnaire: 1. How satisfied are you with the offerings in this category? 2. Can you recall any instances when you were dissatisfied with a product/service in this category? 3. How did you handle the situation when you were dissatisfied? 4. How did you feel about the company's or retailer's response to your dissatisfaction? Summary of Responses from 15 Consumers: (a) Consumer Satisfaction: • Most Satisfied: Streaming Services (positive feedback on content variety and user experience). • Least Satisfied: Airline Travel (frequent complaints about delays and customer service). (b) Dissatisfaction Reasons: • Most Dissatisfied: Airline Travel (issues with delays, cancellations, and poor customer service). • Reason: Frequent operational challenges and less personal interaction contribute to dissatisfaction. (c) Common Responses to Dissatisfaction: • Smartphones: Seek warranty service or return the product. • Grocery Delivery Services: Contact customer support or request refunds. • Airline Travel: File complaints with customer service or social media. • Streaming Services: Cancel subscriptions or contact support for troubleshooting. • Washing Machines: Request repair service or exchange. (d) Handling of Dissatisfaction: • Effective Handling: Streaming Services (responsive customer support, quick issue resolution). • Poor Handling: Airline Travel (slow response, unsatisfactory resolutions). 2. Interview two marketing professionals (from different companies), either by phone or in person. Ask them to describe in detail (1) how important satisfaction/dissatisfaction is to their business, (2) how they try to generate satisfaction, and (3) what kinds of experiences they have had with dissatisfied consumers, and how they handled these problems. Summarize your findings for each topic. Answer: Again, students who have worked in the customer service field should be able to amply supply dynamic discussion material on this topic. Ask them to couch their responses in terms of the attribution theory and/or the equity theory to illustrate their applications. Did they ever have an angry customer that was being unreasonable? How did they handle the situation? Was the consumer’s complaint based on attribution or equity theory? Interview Summaries: Marketing Professional 1: Company A (Consumer Electronics) 1. Importance of Satisfaction/Dissatisfaction: • Importance: Critical to business; directly impacts brand loyalty and repeat purchases. High customer satisfaction drives positive reviews and referrals. 2. Generating Satisfaction: • Strategies: Focus on high-quality products, robust customer support, and extensive warranty services. Implement customer feedback systems to continuously improve products. 3. Handling Dissatisfaction: • Experiences: Common issues include product defects or unmet expectations. • Resolution: Prompt resolution through efficient returns and exchanges, personalized support, and addressing feedback to prevent future issues. Marketing Professional 2: Company B (Online Retailer) 1. Importance of Satisfaction/Dissatisfaction: • Importance: Vital for maintaining customer loyalty and reducing churn. Dissatisfaction can lead to negative reviews and loss of potential customers. 2. Generating Satisfaction: • Strategies: Provide fast, reliable delivery, easy returns, and personalized customer service. Use customer data to tailor recommendations and enhance shopping experiences. 3. Handling Dissatisfaction: • Experiences: Frequent issues with delivery delays or incorrect orders. • Resolution: Offer immediate refunds or replacements, provide clear communication and updates, and ensure effective handling of complaints through a dedicated support team. Summary: 1. Importance: Both professionals emphasize that customer satisfaction is crucial for brand loyalty and business success. 2. Satisfaction Strategies: Focus on product quality, responsive customer service, and personalized experiences. 3. Dissatisfaction Handling: Address issues with prompt resolutions and effective communication to restore customer trust and prevent future dissatisfaction. 3. Pick five durable and five nondurable products. Develop a set of questions to determine how consumers disposed of each product the last time they needed to do so. Administer the questionnaire to at least ten consumers. Summarize the responses, and answer the following questions: (a) For each product category, which are the most frequently used methods of disposition? (b) Which product categories are most alike in terms of disposition patterns? Why? (c) Which product categories are most dissimilar in terms of disposition patterns? Why? Remind students to refer to the chapter exhibit for a thorough representation of the different methods of product disposition. Challenge students to come up with pertinent examples of each of these different disposition approaches. Answer: Product Categories: Durable Products: 1. Refrigerators 2. Washing Machines 3. Televisions 4. Furniture 5. Computers Nondurable Products: 1. Food Packaging 2. Toothpaste Tubes 3. Plastic Bottles 4. Paper Towels 5. Cosmetic Containers Questionnaire: 1. How did you dispose of this product the last time you needed to? 2. Did you recycle, donate, sell, or throw it away? 3. If recycled or donated, what steps did you take? 4. If discarded, was it through regular trash or special disposal services? Summary of Responses from 10 Consumers: Durable Products: 1. Refrigerators: • Disposition Methods: Most commonly recycled through a special disposal service. 2. Washing Machines: • Disposition Methods: Recycled or donated, often coordinated through appliance stores. 3. Televisions: • Disposition Methods: Recycled through electronics recycling programs or donated. 4. Furniture: • Disposition Methods: Donated to charities or sold online. 5. Computers: • Disposition Methods: Recycled or donated, sometimes traded in for credit. Nondurable Products: 1. Food Packaging: • Disposition Methods: Recycled or disposed of with regular trash. 2. Toothpaste Tubes: • Disposition Methods: Disposed of with regular trash or recycled if possible. 3. Plastic Bottles: • Disposition Methods: Recycled. 4. Paper Towels: • Disposition Methods: Disposed of with regular trash. 5. Cosmetic Containers: • Disposition Methods: Recycled or thrown away. (a) Most Frequently Used Methods: • Durable Products: Recycling (Refrigerators, Washing Machines), Donation (Furniture). • Nondurable Products: Recycling (Plastic Bottles), Regular Trash (Paper Towels). (b) Most Alike in Disposition Patterns: • Televisions and Computers (Durable) with Plastic Bottles (Nondurable): All are commonly recycled. (c) Most Dissimilar in Disposition Patterns: • Furniture (Durable) vs. Food Packaging (Nondurable): Furniture is often donated or sold, while food packaging is typically disposed of or recycled as part of regular trash. 4. Make an inventory of at least 30 of your possessions. For each, indicate when and how you plan to dispose of it. Also, provide detailed reasons for this behavior. Then summarize this information, and answer the following: (a) Which possessions will be the easiest to dispose of, and why? (b) Which possessions will be the hardest to dispose of, and why? (c) What are your most frequent disposition options, and why? Answer: Since disposition decisions often influence later acquisition decisions, it is important to understand this often-overlooked phase of the consumer behavior process. How might the students’ disposition behavior change in the future due to advances in technology? How have disposition behaviors in the U.S. changed during the students’ lifetimes? Inventory and Disposal Plan: 1. Old T-Shirts: Donate within 6 months; they're worn but still usable. 2. Expired Medicines: Dispose at pharmacy take-back program; safety concern. 3. Broken Umbrella: Throw away immediately; no longer functional. 4. Old Magazines: Recycle monthly; clutter reduction. 5. Used Electronics (e.g., old phone): Recycle or donate; outdated technology. 6. Books: Donate to library; still in good condition. 7. Old Shoes: Donate if still wearable; worn out. 8. Furniture (e.g., old chair): Donate or sell; no longer fits current needs. 9. Kitchen Appliances (e.g., old blender): Recycle; replaced with newer model. 10. Expired Food: Dispose with regular trash; not consumable. 11. Broken Electronics (e.g., old laptop): Recycle through e-waste program; non-functional. 12. Plastic Bags: Recycle at designated drop-off points; reduces waste. 13. Used Car Tires: Dispose at tire recycling center; safety and environmental concern. 14. Old Bedding: Donate or recycle; no longer needed. 15. Old Paint Cans: Dispose at hazardous waste facility; environmental hazards. 16. Old CDs/DVDs: Recycle; outdated media. 17. Unused Tools: Donate or sell; no longer used. 18. Worn Out Towels: Recycle or use as rags; no longer suitable for use. 19. Unused Exercise Equipment: Donate or sell; no longer used. 20. Old Wallets: Dispose if damaged; no longer functional. 21. Outdated Cosmetics: Dispose with regular trash; past expiration date. 22. Broken Jewelry: Repair or recycle; not wearable. 23. Old Office Supplies: Recycle or donate; no longer needed. 24. Old Holiday Decorations: Donate or discard; replaced with new. 25. Unused Sporting Goods: Donate or sell; no longer used. 26. Worn Out Rugs: Dispose or recycle; damaged. 27. Old Bags and Luggage: Donate or recycle; no longer needed. 28. Broken Garden Tools: Recycle; not functional. 29. Unused Crafts Supplies: Donate or dispose; not used. 30. Old Glassware: Donate or recycle; no longer used. Summary: (a) Easiest to Dispose of: • Old Magazines, Expired Food, and Plastic Bags: These are simple to dispose of through recycling or trash due to their commonality and clear disposal methods. (b) Hardest to Dispose of: • Old Furniture, Used Electronics, and Old Paint Cans: These require specific disposal methods (donation, e-waste recycling, hazardous waste facilities) and can be cumbersome to manage. (c) Most Frequent Disposition Options: • Donation and Recycling: Frequently chosen due to environmental concerns and the desire to repurpose usable items. SUGGESTED INTERNET EXERCISES WITH SAMPLE ANSWERS GOODWILL INDUSTRIES The motivation, ability, and opportunity of consumers to sell, donate, or trade items they already own has changed with the advent of online technology. Even venerable non-profit organizations like Goodwill Industries (www.goodwill.org/page/guest/about) utilize the Internet to inform and persuade consumers concerning the disposition of their possessions. Visit Goodwill’s website and search for ways in which the site may influence consumers’ disposition activities. What benefits to consumers and to society does the organization’s website emphasize? Instructor Notes Goodwill Industries’ website reminds consumers of the organization’s mission: job training and placement for people with disabilities and other disadvantages relative to work. Consumer donations of used products fuel the organization. Its trainees gain skills by repairing or refurbishing donated items; working in Goodwill’s retail operations; or providing staff or clerical support. The sale of donated items provides revenue for the organization’s ongoing operations. The website emphasizes that consumers benefit from donating to Goodwill because the value of their donations is tax-deductible. Goodwill also facilitates consumers’ processes of physical detachment from possessions for which they have no further use (or have difficulty storing, using, or disposing of by other means) with ubiquitous donation centers. The website provides a toll-free telephone number and a map with address links for locating the nearest Goodwill facility, guidelines for donating, and information about tax deductions for charitable contributions. Consumers who are interested in purchasing used items may visit nearby Goodwill retail facilities or may shop online at ShopGoodwill.com. Certainly Goodwill’s site focuses on the organization’s benefit to society as well as to consumers. Its original and continuing mission improves the lives of some of society’s most disadvantaged members, which benefits society directly. Indirectly, Goodwill also benefits society by changing potential tax consumers (for example, recipients of government disability and welfare programs) into taxpayers. . Additional Uses This exercise also relates to concepts in the following chapters: • Chapter 6, Attitudes Based on Low Effort (influencing attitudes about donation to Goodwill) • Chapter 9, Judgment and Decision Making Based on Low Effort (impact of normative tactics or brand familiarity on consumers’ decision to donate to, or shop at, Goodwill) • Chapter 13, Household and Social Class Influences (impact of social class and income on donation and consumption behavior regarding Goodwill) • Chapter 14, Psychographics: Values, Personality, and Lifestyles (psychographic profile of Goodwill donors and supporters) Discussion Idea What marketing tactics can Goodwill implement to help consumers to detach from items to which they have a strong emotional attachment? Possible answers might include: • Powerful marketing messages about the altruism of donation • Persuasion to identify with Goodwill’s mission, enabling consumers to donate • Providing simple and convenient ways to donate (home pick-up of donated items, for example) • Sending messages of appreciation after donation, to reduce post-decision dissonance ADDITIONAL DISCUSSION QUESTIONS WITH SAMPLE ANSWERS These discussion questions can be used as in-class activities or as thought questions that the students consider while reading the chapter or to test their understanding of the material after the reading and lecture are complete. 1. Define and discuss the four primary post-decision processes. Answer: The first process a consumer may experience is post-decision dissonance: the anxiety a consumer may feel after a purchase. Dissonance is greater when the purchase is more costly, is made less often, is riskier, and is more public, or when the item lasts longer. The second process is post-decision learning. Here the consumer learns about a product by using it. A consumer is more likely to be receptive to information acquired during acquisition, consumption, and disposition than earlier information because this earlier information often is viewed as a sales tactic. Information gained through experience also is more vivid and easier to remember. Satisfaction/dissatisfaction is the third process. Consumers determine their level of satisfaction by comparing their expectations of a purchase process with the actual purchase situation. In the expectancy-disconfirmation model, the consumer will be satisfied if the experience is equal to or better than the expectation; the consumer will be dissatisfied if the experience is less than the expectation. The final process is disposition: how a consumer parts with an object. He or she may give it away, sell it, use it up, abandon it, etc. Disposition is influenced by the consumer’s motives, situational and product-related facts, and the value and meaning of the product. 2. What steps can a consumer take in response to dissatisfaction? What is likely to be the outcome of each choice? Answer: A consumer can choose to act or not. The majority of consumers (estimates are upwards to 95 percent) do not complain. (a) Some will not act at all. (b) Others will not say anything to the firm but will spread their bad feelings through word of mouth. Individuals in both of these situations are likely to remain dissatisfied because their issue with the product or service does not get resolved. (c) In addition, a consumer may just stop buying the product. Just like in examples (a) and (b), the firm has no way of knowing what the problem is and has no opportunity to resolve this issue. (d) Other consumers choose to react by complaining to the store manager or manufacturer. If this interaction has a positive outcome, the consumer may continue to use the product or even consider the experience satisfactory. (e) Some consumers may contact a watchdog group or government agency to complain or file a legal action. In these instances, the likelihood of the customer returning decreases significantly. ADDITIONAL QUESTIONS 1. Is it possible to dissatisfy someone before they make a purchase? How? How can this situation be avoided? Answer: Yes: Through misleading ads or poor pre-purchase service. Avoid: Provide clear information and good customer service. 2. Explain what makes service situations (such as airlines, hotels, doctors, and restaurants) different from tangible products with respect to how they might generate dissatisfaction. Describe how dissatisfaction can be avoided or addressed in service situations (mention ways that are different from when you are working with a physical good). Answer: Differences: Services involve interactions and intangibles (e.g., wait times, staff behavior). Avoidance/Resolution: Train staff, ensure consistent quality, and handle complaints effectively. 3. Consider each of the three ways consumers make dissatisfaction judgments. How could each type of dissatisfaction emerge with respect to (1) a long-distance phone company, (2) a computer hardware maker, or (3) a university? Answer: Long-Distance Phone Company: Performance (poor call quality), Disconfirmation (service vs. ads), Attribution (blaming the company). Computer Hardware Maker: Performance (malfunctions), Disconfirmation (advertised specs), Attribution (support issues). University: Performance (poor support), Disconfirmation (campus vs. expectations), Attribution (academic challenges). 4. Knowing that consumers might respond to dissatisfaction in predictable ways, how can an organization prepare to address such responses? Answer: Actions: Have responsive customer service, clear complaint policies, and use feedback to improve. 5. Describe how the following “underdogs” would manage consumer learning: (a) Pepsi-Cola, (b) Ford automobiles, and (c) Dell computers. Develop a similar explanation for each of the following “top dogs”: (a) Crest toothpaste, (b) Budweiser beer, and (c) Compaq computers. Answer: Underdogs: Highlight unique features (Pepsi-Cola, Ford, Dell). Top Dogs: Reinforce quality and reliability (Crest, Budweiser, Compaq). 6. Develop a diagram showing how satisfaction and dissatisfaction occur through the disconfirmation paradigm by providing examples from your own experience. Answer: Example: Expectation → Experience → Disconfirmation (Positive/Negative) → Satisfaction/Dissatisfaction. 7. Explain why marketers should or should not be concerned about negative word of mouth. Provide a plan for dealing with negative word of mouth for an offering of your choosing. Answer: Concern: Can harm reputation. Plan: Address complaints promptly, engage on social media, and improve underlying issues. 8. Describe three situations in which marketers should be concerned about disposition. Explain what can be done to address these concerns. Answer: Situations: Returns, e-waste, end-of-life products. Address: Offer easy returns, recycling programs, and sustainable practices. 9. Discuss the factors that are making disposition an increasingly important issue for marketers. Predict how these factors are likely to change in the future. Offer suggestions for dealing appropriately with this situation. Answer: Factors: Environmental concerns, regulations, and consumer awareness. Future Predictions: Greater focus on sustainability. Suggestions: Develop take-back programs, promote recycling, and educate consumers. EXPERIENTIAL EXERCISES AND CLASSROOM EXAMPLES Students who learn more readily through visual and tactile stimuli will benefit from the introduction of physical examples into the classroom. 1. “Spread the Word” Exercise Have students visit the following consumer opinion and complaint Web sites to familiarize themselves with the resources available to dissatisfied consumers. Tell them to record two or three of the most extreme complaints they found on the sites and share them with the class. Discuss the implications to consumers and companies of these and other websites. www.epinions.com www.untied.com www.allstateinsurancesucks.com 2. “From Trash to Treasures” Exercise Tell students to visit the Web’s largest auction site, www.eBay.com, and find five “recycled” items of interest to them (e.g., a 1998 Dallas Cowboys/Oakland Raiders ticket stub, a 1966 “What Shall I Be?” board game, a 1960s tuxedo for a Ken doll, a pair of Spice Girl platform sneaker sandals, a playbill from a 1951 Judy Garland show). Ask students to explain why they chose the items they did. Discuss the effects on a product’s life cycle of on-line auctions specifically and the collectibles craze in general. 3. Service Complaint/Compliment Letter Ask students to consider their recent product/service purchase experiences. Have them select one of these experiences that was very memorable––in other words, choose an encounter with a product or service that definitely did not meet their expectations or greatly exceeded their expectations. Have them find the address/email address of the organization that provided them with this memorable (positive/negative) experience, and compose a professional letter/email that provides the details of the experience, explains why the experience didn’t meet their expectations/greatly exceeded their expectations, explains how they feel the situation could be remedied/continued in the future, and make specific recommendations as to what the company might do to keep them as a valued customer. Make sure the student provides an avenue for the organization to get in touch with them (phone number, return address, e-mail, etc.). CLASSROOM GROUP ACTIVITY Separating Satisfaction from Dissatisfaction: 15 Minutes I. Start Up A. Purpose of the activity 1. This activity will give students an opportunity to apply the concepts of satisfaction and dissatisfaction in a brief classroom exercise. B. What the instructor will do 1. The instructor will divide people into small groups, assign them a product for consideration, and be available to coach and help the groups as needed. C. What the participants will do 1. The participants will work in small groups to brainstorm ideas for applying concepts from the chapter to specific brands. After a period of small-group discussion, they will make reports to the larger group. D. Rules for this experience 1. Groups are to work separately from each other. Individuals should rely on their knowledge from the book and may refer to their notes and the book as necessary. II. Experience A. Group up. 1. Have students form groups of no more than five. This exercise will work in groups of any size; however, room restrictions that do not allow for moving furniture may make group work more difficult. B. Assign brands. 1. Each group should be assigned a single brand on which to focus. a) Consider using local brands, including both products and services. b) Consider using brands that are not the leaders in their categories (i.e., not Coca-Cola or McDonald’s). c) Consider bringing samples of the brands to the class for students to study and review in their groups (e.g., a box of crackers, a candy bar, a cola can). C. Specific actions for groups 1. The groups are responsible for analyzing how the offering might lead to dissatisfaction on the part of consumers. Then they are to discuss how the organization could alleviate the likelihood of this occurring and be prepared in case it does occur. a) What might lead consumers to experience dissatisfaction with this product? b) How can the organization plan so that these sources of dissatisfaction can be eliminated? c) What would you propose be done to address consumer dissatisfaction when it occurs for this brand? 2. Large-group discussions a) First, have groups present their ideas about the first question, and then proceed to discuss each of the subsequent questions. b) If there are many groups, share the discussion among all groups, though not all groups may answer all of the questions. III. Debrief and Unveil Concepts A. Discuss the activity itself. 1. The purpose of this discussion is to allow students to express what they felt about the experience itself. 2. Ask students to describe their experiences of doing the activity. a) Likes and dislikes about what just happened b) How they felt during the experience c) What is realistic, unrealistic about the exercise? d) What will be different when they do this for their own brand? B. Discuss the content of the experience. 1. The purpose of this discussion is to ensure that students “take away” important learning points. 2. Ask students to describe the important points the experience teaches. a) The role of dissatisfaction in the consumer experience b) The organization’s responsibility to prevent dissatisfaction and address it when it arises 3. Use the chalkboard to record student responses. a) Write down their ideas as they are presented. b) Concentrate on the principles being discussed rather than the examples being used. c) Help them to see the interrelationships among their responses. IV. Execute A. Apply what has been learned. 1. Lead a discussion on how the concepts can be applied in organizations. a) What barriers may be faced in applying the concepts from the exercise? b) What can be done to help others understand the concepts when you use them at work? B. Transfer and use the knowledge. 1. Encourage students to make a record in their notes about how they will use the ideas in the workplace. 2. Even if they do not have a specific job, how will they remember to use what they have learned? Marguerite Reardon, “Don’t Get Scammed When Selling Your Old iPhone,” CNET, November 4, 2011, www.cnet.com; James R. Hagerty, “Entrepreneurs Find Gold in Used Phones,” Wall Street Journal, February 24, 2011, www.wsj.com; Mariamo Diallo, “Used Mobile Phone Campaign Improves Maternal Health,” Voice of America, October 19, 2011, www.voanews.com; and “Cell Phones Recycled to Help Soldiers,” Wisconsin Rapids Daily Tribune, November 4, 2011, www.wisconsinrapidstribune.com. Solution Manual for Consumer Behavior Wayne D. Hoyer, Deborah J. MacInnis, Rik Pieters 9780357721292, 9781305507272, 9781133435211