What is extended problem solving in marketing

An understanding of consumer behavior is necessary for the long-term success and survival of a firm. Consumer decision making is viewed as the edifice of the marketing concept, an important orientation in marketing management.

The marketer should be able to determine needs and wants of the target segment and provide product and service offerings more effectively and efficiently than competitors.

Types of Consumer Decision Making

The following are the types of decision making methods which can be used to analyze consumer behavior −

Extensive Problem Solving

In extensive decision making, the consumers have no established or set criteria for evaluating a product in a particular category. Here the consumers have not narrowed the number of brands from which they would like to consider and so their decision making efforts can be classified as extensive problem solving. In this particular set of problem solving phase, the consumer needs a lot of information to set a criteria on the basis of specific brands could be judged.

Limited Problem Solving

In limited problem solving, the consumers have already set the basic criteria or standard for evaluating the products. However, they have not fully set the established preferences and they search for additional information to discriminate among other products or brands.

Routinized Response Behavior

Here, in routinized response behavior, consumers have experience with the product and they have set the criteria for which they tend to evaluate the brands they are considering. In some situations, they may want to collect a small amount of additional information, while in others they may simply review what they are aware about. In extensive problem solving, consumer seeks for more information to make a choice, in limited problem solving consumers have the basic idea or the criteria set for evaluation, whereas in routinized response behavior consumers need only little additional information.

Views of Consumer Decision Making

An Economic View

Consumers have generally been assumed to make rational decisions. The economic view of consumer decision making is being criticized by researchers because a consumer is assumed to posses the following traits to behave rationally −

• Firstly, they need to be aware of all the alternatives present in the market

• Secondly, they must be able to efficiently rank the products as per their benefits.

• Lastly, they must also know the best alternative that suits them as per their requirements.

In the world of perfect competition, consumers rarely have all the information to make the so called ‘perfect decision.’

A Passive View

Passive view is totally opposite to the economic view. Here, it is assumed that consumers are impulsive and irrational while making a purchase. The main limitation of this view is that consumers also seek information about the alternatives available and make rational or wise decisions and purchase the products or services that provides the greatest satisfaction.

A Cognitive View

The cognitive model helps individuals to focus on the processes through which they can get information about selected brands. In the framework of cognitive view, the consumer very actively searches for such products or services that can fulfill all their requirements.

An Emotional View

Consumers are associated with deep feelings or emotions such as, fear, love, hope etc. These emotions are likely to be highly involving.

Consumer decisions can be categorized into three primary types: 

• Routinized Response - This is the kind of decision where you don't really have to think much about it. 
• Limited Problem Solving - This type of purchase decision involves a little more thinking or a little more consideration. 
• Extensive Problem Solving - This is when we're making a decision to purchase and we are really going to labor over that decision. 

Each of these is discussed further below. 

What is a Routinized Response?

This is the kind of decision where you don't really have to think much about it. That is, it's a routine. In the context of making a purchase, this is when we make the decision to purchase without going through the consumer decision-making process. Generally, it means we simply follow or repeat a previous course of action. Think of going to the store and buying the same type or brand of grocery item that you buy every week. You do this as a routine, rather than identifying alternatives and comparing them. 

What is Limited Problem Solving?

This type of purchase decision involves a little more thinking or a little more consideration. Maybe we consider different products in making our purchase. Maybe we consider how much to buy. Whatever our considerations, we're going to spend more time and effort making this decision or making this purchase. 

What is Extensive Problem Solving? 

This is when we're making a decision to purchase and we are really going to labor over that decision. That is, we are really going to consider it thoroughly. We may do a great deal of research. We may consult friends or look at customer reviews. We generally use this approach when it is something that we have never bought before, its very technical in nature,  or when it is a very expensive item (like a car). Generally, this type of decision involves the most time, information, and effort in the evaluation of alternatives.

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The study of decision  making models plays an integral role in analysing the level of rationality of customer decision making. Namely, the concept of four modes of consumer decision making  proposed by O’Guinn et al (2011). The concept divides consumer decision – making into four different modes according to the level of their involvement, as well as, the level of their personal experiences with the brand.

Extended problem solving

Extended problem solving customer decision – making mode relates to a situation where customers lack experience in a specific consumption setting, nevertheless, the setting is perceived by them as a highly involving. The products are usually of a high value and they also contribute to an individual’s social status, however, their purchase is often associated with significant amount of risk in terms of making improper purchase decision. Purchasing the first car or the first house can be mentioned as instances for extended problem solving.

Limited problem solving

Customer decision – making mode of limited problem solving, relates to a situation where both, customer experience, as well as, the level of their involvement are low. Considered to be the most common mode of decision – making, it lacks systematic approach in terms of decision – making. Examples for this mode of decision – making might include searching for and purchasing products and services associated with pest control within private properties.

In other words, as Perrey and Spillecke (2011) confirm, limited problem – solving customer decision – making mode relate to situations where customers are attempting to find appropriate solutions to their unpleasant issues. Retailers often attempt to attract such type of customers by employing a range of marketing techniques that include introducing discount vouchers, offering free samples etc.

Habit or variety seeking

Habit or variety seeking is the customer decision – making mode where a decision is not involving, however, there are high amount of repeated purchases from a specific brand. For example, the purchase of a specific brand of a dishwasher gel can be repeated over a long period of time in a habitual manner, without re-considering the value associated with the brand even when there are more valuable alternatives have emerged in the market.

Variety seeking relates to instances where customer moves to another brand within a given product category. At the same time, interestingly, “from one purchase occasion to the next, the individual  will switch brands from within this set, just for the sake of variety” (O’Guinn et al, 2011, p.175).

Brand loyalty

Customers with a decision – making mode of brand loyalty practice high level of involvement in decision – making and they also possess high level of experience with a particular brand. Instances of brand loyalty customer decision – making mode include using specific brand of cigarettes for a long period of time.

According to Cant et al (2009), factors effecting customer brand loyalty in retail setting include brand name, the quality of products and services, price and style of products, environment of the store, the level and nature of promotion offered, and the quality of customer services provided. Considerable amount of financial resources are usually invested by leading retailers in order to enhance their brand image and therefore increase their long-term growth prospects.

References

• Cant, M.C., Strydom, J.W. & Jooste, C.J. (2009) “Marketing Management” Juta Publications
• O’Guinn, T.C., Allen, C.T. & Semenik, R.J. (2011) “Advertising and Integrated Brand Promotion” Cengage Learning
• Perrey, J & Spillecke, D. (2011) “Retail Marketing and Branding: A Definitive Guide to Maximising ROI” John Wiley & Sons