1. Chapter Three:
Problem Recognition
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2. Problem recognition
An important stage of consumer decision making
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3. Problem recognition
• Nature of problem recognition
• Difference between habitual, limited and
extended decision making
• Methods for measuring problem recognition
• Uncontrollable factors that effect problem
recognition
• Marketing strategies based on problem
recognition
3-3

4. Need/problem recognition
• What happens during need/problem
recognition?
• Can they be activated?
• Are there non-marketing influences?
• What marketing influences are used?
• Does it vary from one person to the next?
• Implications for marketing strategy?
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5. Types of consumer decisions
• Problem recognition
• Purchase involvement
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6. Types of Consumer Decisions
Purchase involvement is the
level of concern for, or interest
in, the purchase process.
Triggered by need to consider a
particular purchase.
A temporary state influenced by
the interaction of individual,
product, and situational
characteristics.
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7. Types of Consumer Decisions
Product involvement or enduring involvement is very different
from purchase involvement.
A consumer may be very
involved with a brand (e.g.,
Starbucks) or a product
category, BUT…
have low purchase
involvement due to brand
loyalty, time pressures, etc.
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8. Types of consumer decisions (cont.)
• Purchase involvement
– influenced by the interaction of individual, product
and situational characteristics
• Forms of involvement and outcomes
– Habitual decision making—single brand
– Limited decision making
– Extended decision making
• Implications for strategy
3-8

9. Purchase involvement and types
of decision making
Low purchase High purchase
involvement involvement
Habitual Limited Extended
decision decision decision
making making making
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10. Types of Decision Making
Habitual Decision Making
Habitual decision making, in effect involves no decision per
making
se. Go back to buy the same brand.
Habitual decisions occur when
there is very low involvement
with the purchase.
A completely habitual decision
does not even include
consideration of the “do not
Consumer buys Campbell’s
purchase” alternative. without considering other brands,
its price, etc.
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11. Types of Decision Making
Limited Decision Making
Limited decision making involves internal and limited
external search, few alternatives, simple decision rules on
a few attributes, and little post-purchase evaluation.
Middle ground between
habitual and extended
decision making.
Involves recognizing a
problem for which there are
several possible solutions.
Decision based only on
buying the cheapest rolls. 3-11

12. Types of Decision Making
Extended Decision Making
Extended decision making involves extensive internal and
external search followed by a complex evaluation of multiple
alternatives.
It is a response to the high level
of purchase involvement.
During post-purchase evaluation,
doubts are likely and a thorough
evaluation takes place.
Emotional decisions may involve
substantial cognitive effort. 3-12

13. Purchase involvement and types
of decision making (cont.)
3-13

14. The Process of Problem Recognition
The Nature of Problem Recognition
Problem recognition is the result of a gap between a
desired state and an actual state sufficient to arouse and
activate the decision process.
An actual state is the way an individual perceives
his/her feelings and situation to be at the present
time.
A desired state is the way an individual wants to
feel or be at the present time.
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15. Process of problem recognition
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16. The Process of Problem Recognition
The Nature of Problem Recognition
Desire to resolve a particular problem depends on:
1. The magnitude of the discrepancy between
the desired and actual states, and
2. The relative importance of the problem
In general, importance is determined by how critical the
problem is to maintenance of desired lifestyle.
3-16

17. Products are positioned as providing a potential
solution eg. shampoo
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18. Products are positioned as providing a potential
solution eg. cough medicine
3-18

19. Types of consumer problems
• Active problem
– A problem the consumer is aware of, or will
become aware of, in the normal course of
events.
• Inactive problem
– A problem of which the consumer is not yet
aware.
3-19

20. The Process of Problem Recognition
Types of Consumer Problems
Active Problem Inactive Problem
An inactive problem is one of
An active problem is one the
which the consumer is not
consumer is aware of or will
aware.
become aware of in normal
course of events.
Marketing strategy:
strategy Marketing strategy:
strategy
Only require marketer to Marketer must convince
convince consumers that its consumers that they have the
brand is the superior solution. problem AND that their brand
is a superior solution.
3-20

21. Types of consumer problems
and action required
• Routine problems
– Expected, require immediate solution
• Emergency problems
– Not expected, require immediate solution
• Planning problems
– Expected, don’t require immediate solution
• Evolving problems
– Not expected, don’t require immediate solution
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22. Non-marketing factors affecting
problem recognition
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23. Factors that influence the desired state
• Culture/social class, e.g. importance of
cleanliness
• Reference groups, e.g. a change after
graduation
• Family/household, e.g. family brands
• Change in financial status, e.g. retrenchment
• Previous purchase decisions
• Individual development
• Motives: refer to Maslow’s needs
• Emotions: seek positive experiences?
• The situation
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24. Factors influencing the actual state
• Past decisions
• Normal depletion
• Product/brand performance
• Individual development
• Emotions
• The efforts of consumer groups
• The availability of products
• The current situation
3-24

25. Uncontrollable Determinants of Problem
Recognition
Variety-seeking is a challenge to marketers because it means
that consumers switch brands for reasons beyond a company’s
control.
Sensory-specific satiety –
consumers get bored (satiated)
with sensory attributes more than
on non-sensory attributes.
Offering variety on key sensory
attributes can increase loyalty to
the brand even if consumers
Variety WITHIN brand can drive
engage in variety seeking. loyalty in the face of variety
seeking.
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26. Marketing Strategy and Problem
Recognition
1. Discovering Consumer Problems
2. Responding to Consumer Problems
3. Helping Consumers Recognize Problems
4. Suppressing Problem Recognition
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27. Marketing Strategy and Problem
Recognition
Discovering Consumer Problems
A wide variety of approaches are used to determine the
problems consumers face.
1. Intuition - the most common, however, the problem identified
may be of low importance to most consumers
2. Survey – asks relatively large numbers of individuals about
the problems they are facing
3. Focus Groups – composed of 8 to 12 similar individuals
brought together to discuss a particular topic; a moderator is
present to keep the discussion moving and focused on the
topic but otherwise free flowing
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28. Product / brand performance
Many products need to perform on two levels:
• Instrumental performance
• Expressive performance
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29. Marketing strategy and
problem recognition (cont.)
• Measuring problem recognition (cont.)
– Problem analysis—product/brand
solutions?
– Human factors research—suit users
– Emotion research—how people feel
about it
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30. Marketing Strategy and Problem
Recognition
Discovering Consumer Problems
Human Factors Research
Human factors research attempts to determine human capabilities
in areas such as vision, strength, response time, flexibility, and
fatigue and the effect on these capabilities of lighting, temperature,
and sound.
Observational techniques such as slow-motion and time-
lapse photography, video recording, and event recorders are
particularly useful methods.
This type of research can sometimes identify functional
problems that consumers are unaware of.
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31. Marketing Strategy and Problem
Recognition
Discovering Consumer Problems
Emotion Research
Marketers are increasingly conducting research on the role of
emotions in problem recognition and resolution.
Common approaches are focus group research and personal
interviews that examine the emotions associate with certain
problems.
Critical in helping marketers anticipate consumer reaction to
problems and train customer service personnel to respond
appropriately.
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32. Marketing strategy and
problem recognition
• Measuring problem recognition
– Activity analysis—study of meal
preparation
– Product analysis—problems using it?
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33. Marketing Strategy and Problem
Recognition
Discovering Consumer Problems
Surveys and focus groups use one of the following approaches
to problem identification:
1. Activity Analysis Focuses on a particular activity to determine
what problems consumers encounter during the
performance of the activity.
2. Product Analysis Examines the purchase or use of a particular
product or brand. Consumers may be asked
about problems associated with using a product
or brand.
3. Problem Analysis Starts with a problem and asks which activities,
products, or brand are associated with (or
perhaps could eliminate) those problems
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34. Marketing Strategy and Problem
Recognition
Responding to Consumer Problems
Once a consumer problem is identified, the manager may
structure the marketing mix to solve the problem.
This can involve:
• Developing a new product or altering an existing one
• Modifying channels of distribution
• Changing pricing policy, or
• Revising advertising strategy
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35. Responding to consumer problems
• Activating problem recognition
– Generic problem e.g. dairy foods
when the problem is latent or of low
importance
– Selective problem recognition e.g. one
brand solution
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36. Marketing Strategy and Problem
Recognition
Helping Consumers Recognize Problems
Generic versus Selective Problem Recognition
Generic Problem Recognition Selective Problem Recognition
• Involves a discrepancy that • Involves a discrepancy only
a variety of brands within a one brand can solve
product category can
reduce • Firms attempt to cause
selective problem
• Increasing generic problem recognition to gain or
recognition generally maintain market share
results in an expansion of
the total market
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37. Responding to consumer problems
• Influencing the desired state
– Highlight unique features
• Influencing perceptions of the desired state
– Challenge customer to re-examine the existing
state (‘good enough?’
• Timing problem recognition,
e.g. winter colds

38. Marketing Strategy and Problem
Recognition
Helping Consumers Recognize Problems
Approaches to Activating Problem Recognition
How can a firm influence problem recognition?
Recall that problem recognition is a function of
(1) the importance, and
(2) the magnitude
of a discrepancy between the desired state and an existing state
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39. An active
attempt to
activate problem
recognition
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40. Marketing Strategy and Problem
Recognition
Helping Consumers Recognize Problems
Approaches to Activating Problem Recognition
Many marketing efforts attempt to influence the desired state,
often advertising the benefits their products will provide and
hoping that these benefits will become desired by consumers.
It is also possible to influence perceptions of the existing state
through advertisements.
Critics frequently question the ethics of activating problem
recognition, especially for problems related to status or social
acceptance.
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41. Marketing Strategy and Problem
Recognition
Helping Consumers Recognize Problems
The Timing of Problem Recognition
Consumers often recognize problems at times when purchasing
a solution is difficult or impossible, such as
• deciding to purchase a generator during a hurricane
• becoming aware of the need for health insurance after
being hospitalized
A common marketing strategy is to trigger problem recognition in
advance of the actual problem
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42. Responding to consumer problems
(cont.)
• Suppressing problem recognition
– Avoid upsetting habitual buyers
– Anticipate and counteract negatives
3-42

43. Marketing Strategy and Problem
Recognition
Helping Consumers Recognize Problems
Suppressing Problem Recognition
Occasionally information is introduced in the market place that
triggers problem recognition that some marketers prefer to avoid.
Obviously marketers do not want their current customers to
recognize problems with their brands.
Effective quality control and distribution (limited out-of-
stock situations) are important in this effort.
Packages and package inserts that assure the consumer of
the wisdom of their purchase are also common.
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44. Summary of topics in this chapter
• What is the nature of problem recognition?
• What is the difference between habitual,
limited and extended decision making?
• What are the key methods for measuring
problem recognition?
• What are the uncontrollable factors that
effect problem recognition?
• What marketing strategies can be used to
activate problem recognition?
3-44