Systematic and Heuristic Approaches to Consumer Choice: a Contingent Processing Framework

ABSTRACT - This paper offers a framework for understanding contingent choice behavior in consumers. The model proposed here suggests that consumer choice is characterized by two basic types of processing: systematic and heuristic. The use of one approach over the other is viewed as being contingent on a variety of task factors and individual differences which affect consumers' motivation and ability to engage in choice processing.



Citation:

Deborah Roedder John and Siew Meng Leong (1985) ,"Systematic and Heuristic Approaches to Consumer Choice: a Contingent Processing Framework", in SV - Historical Perspective in Consumer Research: National and International Perspectives, eds. Jagdish N. Sheth and Chin Tiong Tan, Singapore : Association for Consumer Research, Pages: 244-250.

Historical Perspective in Consumer Research: National and International Perspectives, 1985     Pages 244-250

SYSTEMATIC AND HEURISTIC APPROACHES TO CONSUMER CHOICE: A CONTINGENT PROCESSING FRAMEWORK

Deborah Roedder John, University of Wisconsin-Madison

Siew Meng Leong, National University of Singapore

[Order of authorship is alphabetical as both authors contributed equally to the preparation of this paper.]

ABSTRACT -

This paper offers a framework for understanding contingent choice behavior in consumers. The model proposed here suggests that consumer choice is characterized by two basic types of processing: systematic and heuristic. The use of one approach over the other is viewed as being contingent on a variety of task factors and individual differences which affect consumers' motivation and ability to engage in choice processing.

INTRODUCTION

Choice behavior has long been of interest to consumer researchers and marketing practitioners. Investigators have attempted to predict and explain consumer choice from the earliest studies based on personality profiles to the most recent research based on information processing principles. As a result of this continuing focus, much has been learned about the amount and type of information that is processed during choice, the types of rules and strategies used to make choices, and the accuracy with which these choices are made.

One of the most important generalizations emerging from this literature is that choice behavior is highly contingent on the characteristics of the choice task and the characteristics of the individual making the choice (see Punj and Stewart 1983). Individuals vary in the way they approach decision-making and are highly sensitive to seemingly minor changes in decision tasks (Einhorn and Hogarth 1981). With respect to task characteristics, two major sets of factors have been identified as particularly influential in this regard: task effects and context effects. Task effects are those factors associated with the general structural characteristics of the decision problem, such as number of alternatives and number of attributes per alternative. Context effects describe those factors associated with the particular value,; of the objects in the choice set, such as the similarity of alternatives (Payne 1982). Added to these structural characteristics are individual factors which influence the way that consumers approach the decision process, such as the level Of involvement and expertise.

Although previous research has been instructive in identifying the factors listed above, less attention has been devoted to developing conceptual frameworks which account for the influence of these factors. Despite the recent interest in this topic among psychologists (see Payne 1982), consumer researchers have focused little effort toward understanding why and how task characteristics and individual factors should affect consumer choice processing. Needed is a general framework to specify how these factors might affect the approaches consumers use in making choices in the marketplace,

The purpose of this paper is to offer a preliminary framework for understanding contingent choice behavior in consumers. Consumers are viewed as approaching choice in one of two ways which differ in terms of the amount and type of processing effort expended. The type of approach followed in a particular situation is governed by two basic factors which summarize a number of individual and situational influences. This model is then used to interpret and explain the influence of task effects, context effects, and individual factors previously found in consumer choice.

The first section of the paper presents a detailed description of the conceptual framework for understanding contingent choice behavior. The next section briefly reviews the types of task factors and individual differences which have been found to affect consumer choice in the past and interprets these findings using the proposed conceptual model. The final section provides directions for future research and discusses the relationship of the proposed model to previous contingent choice models.

CONCEPTUALIZING CONTINGENT CHOICE BEHAVIOR

Modeling contingent choice behavior requires an examination of two basic issues. First, the basic ways in which consumers approach decision making must he specified. This characterization must be general enough to cover the wide array of processing situations involved in decision making and yet be specific enough to capture the essential character of different approaches. Second, a set of factors must be specified which determine the approach consumers will employ in a particular decision-making situation. These factors must be described in terms which are general enough to cover a wide variety of situational and individual influences likely to affect decision making.

The model proposed here addresses these issues by characterizing decision making in terms of two basic approaches used by consumers: systematic and heuristic approaches. The selection of one approach over the other is viewed as resulting from two major factors: the consumer's motivation and the consumer's ability to process information. Both components are described in detail below.

Systematic and Heuristic Approaches

The distinction between systematic and heuristic approaches, suggested by recent theorizing in social psychology (Chaiken 1980; Petty and Cacioppo 1981), is based upon the premise that much of the variance in decision making can be described by the amount and type of effort consumers devote to choice processing. Systematic approaches involve detailed processing of attribute-related information while heuristic approaches focus on the use of simple rules and cognitive heuristics. Thus, heuristic approaches to choice involve less effortful processing of attribute-related information, imply the use of simple situational cues, and suggest the employment of noncompensatory evaluative strategies.

Similar distinctions have been proposed for explaining processing differences in domains other than consumer decision making. In the area of attitude change, researchers have made distinctions between systematic and heuristic approaches to attitude change (Chaiken 1980) as well as central and peripheral routes to persuasion (Petty and Cacioppo 1981). Both characterizations are based on the notion that individuals make judgments in one of two ways: based upon a detailed and careful consideration of issue-relevant arguments or based upon simple inferences and readily-available cues. In the area of cognitive psychology, similar distinctions have been drawn to characterize the depth and effort devoted to processing information. Notable examples are the distinctions drawn between sensory and semantic levels of processing (Craik and Lockhart 1972), mindful and mindless behavior (Langer 1978), and automatic and effortful, conscious, or controlled processing (Bargh 1984; Hasher and Zacks 1979; Shiffrin and Schneider 1977). Thus, the distinction between systematic and heuristic approaches to consumer choice appears to be consistent with current theorizing in several areas of affect and cognition.

Selecting Between Approaches

The factors which guide the selection of decision-making approaches are viewed here as affecting consumer choice in one of two ways: by influencing the consumer's motivation to process or the consumer's ability to process . This characterization, based on one proposed by Petty and Cacioppo (1981) in the attitude Literature, suggests that the effects of most situational and individual influences can be accounted for by one of these two basic factors. For example, the motivation to process increases as the level of personal relevance increases or as the consequences of making a decision become more important. In a similar vein, the ability to process increases as the complexity of product information decreases, as the amount of product information decreases, and as the time available for making choices increases.

Both factors play an important role in determining which approach consumers will follow in a particular decision-making situation. In general. terms, we believe that the selection between systematic and heuristic approaches is governed by some type of cost-benefit analysis wherein the benefits of detailed cognitive processing are weighed against the "costs of thinking Beach and Mitchell 1978; Christensen-Szalanski 1980; Shugan 1980). These benefits ~Ind Costs, ill turn, -ire based upon the level of motivation and ability to process present in the decision-making situation. For example, perceived benefits would increase with increases in motivational factors whereas perceived costs would increase with increases in processing difficulties such as time pressure or information complexity.

In more specific terms, we propose that consumers will engage in systematic processing of attribute-related information during choice only if they are both willing and able to do so. Absent one or both these conditions, the model posits that consumer choice will follow a more heuristic approach (see Figure 1). The rationale for this is that cognitive heuristics are useful judgmental principles that reduce complex tasks to simpler operations and usually achieve reasonable approximations in real-life situations (Hogarth 1981). Heuristics, rather than more complete and formal analyses such as information integration (Anderson 1981; also Lynch 1985) or compensatory evaluation (Fishbein and Azjen 1975), are employed most in the presence of time pressure or when a consumer's cognitive processing system is taxed or overloaded (Sherman and Corty 1984). Due to the cost effectiveness of applying rules of thumb, heuristics such as representativeness or availability (Tversky and Kahneman 1974) and noncompensatory strategies such as elimination-by-aspects (Tversky 1972) will tend to be used for unimportant or uninvolving choices. Under these conditions, consumer choice will be more susceptible to simple situational cues. Absent such cues, consumers are posited to maintain their status quo if possible (i.e., not to choose), or, if compelled to do so, may make one randomly. if simple situational cues are present, choices may be based on peripheral information affecting a consumers' problem framing process (Tversky and Kahneman 1981). Strategies employed during evaluation will also tend to be noncompensatory in nature.

FIGURE 1

SYSTEMATIC AND HEURISTIC APPROACHES TO CONSUMER CHOICE

The selection of a decision-making approach has additional implications beyond those associated with the type of processing likely to occur. Choices made via the systematic path are thought to result in relatively more enduring preferences over those made under little or no deliberation via the heuristic approach. This prediction is consistent with empirical findings in attitude research where attitudes formed from effortful issue-relevant cognitive activity are less likely to change while those resulting from little or no cognitive elaboration seem to persist only as long as the persuasion cues on which they were formed remain salient (Petty 1977).

TABLE 1

CONTINGENCIES IN CONSUMER CHOICE

EXPLAINING CONTINGENCIES IN CONSUMER CHOICE

Previous findings in the consumer choice area have identified a number of factors which influence the decision-making process: task effects, context effects, and individual differences. The model described here provides a framework for understanding how. and why these factors should affect consumer choice. The following discussion provides a brief overview of past empirical findings and then interprets these findings in terms of the proposed model of contingent choice behavior.

Previous Findings

Among the factors investigated in previous examinations of consumer choice, task characteristics appear to be the most pervasive factors uncovered to date (see Table 1). Characteristics of the decision set (number of alternatives and number of attributes per alternative), characteristics of the decision context (time pressure, distraction), characteristics of decision-relevant information (information format), and characteristics of the decision itself (frequency of choice, decision uncertainty) have been studied in a wide variety of investigations. These factors have been found to affect the amount of information selected and processed, the processing strategies employed (compensatory versus noncompensatory strategies and processing by brand versus attribute), and the time and accuracy with which choices are made.

A related area of some interest has been context effects in consumer decision making. Most investigations have focused on the degree of similarity among choice alternatives and attribute ratings. Variations in this factor have been found to affect the weighting of attributes in the decision process and the type of processing employed (brand versus attribute processing).

Individual differences constitute the third and final area of interest in previous examinations. The importance of the decision, the level of involvement, and the degree of prior knowledge and experience have emerged as important factors in this regard. Factors such as these have been associated with several differences in decision making such as the amount of information search and acquisition, the amount of choice-relevant information processed, the type of processing employed (brand versus attribute processing), and the accuracy with which choice are made.

Interpretation

Findings regarding task effects, context effects, and individual differences can be readily understood with the aid of the consumer choice model described earlier. Each of these factors can be easily incorporated into the model by classifying their primary influence as one affecting either the consumer's motivation to process or ability to process. This class ification is illustrated in Table 2 and discussed in more detail below.

TABLE 2

INTERPRETING CONTINGENCIES IN CONSUMER CHOICE

Motivation to Process. Of the factors thought to influence motivation to process, individual influences play a particularly important role. Both decision importance and level of involvement are closely tied to the motivation construct. Decisions which are relatively unimportant or uninvolving are unlikely to motivate consumers to process information in a systematic and effortful manner. When the degree of involvement is high or the choice concerns something personally relevant to the consumer, however, more formal and complete analyses may be engaged. Findings from several areas other than consumer choice support this interpretation. With respect to involvement, both Chaiken (1980) and Petty, Cacioppo, and Schumann (1983) have found that individuals tend to consider issue-relevant arguments in a careful manner under high involvement. Under low involvement, simple peripheral cues such as the credibility or likeability of the message source tend to be used in rendering attitudinal judgments. Similar effects appear to be associated with differences in decision importance. For example, Gabrenya and Arkin (t979) have reported the use of nonvigilant low-level processing, including the use of heuristics and scripts, in situations involving few important consequences for subjects. As consequences become more important, Langer (1978) suggests that "mindless" processing will cease and more effortful processing will occur.

In addition to these individual factors, task effects can also contribute to differences in motivational levels found in various choice situations. Among these, frequency of choice and decision uncertainty appear to be the best candidates in terms of affecting the degree to which consumers are motivated to process information. Uith respect to frequency of choice, consumers are likely to be motivated to systematically process attribute information when confronted with one-time choice situations. When Multiple choices are made over a period of time, consumers are less likely to scrutinize attribute information every time and are more likely to base decisions on global brand evaluations. This interpretation is consistent with current models of affective judgments proposed by Fiske and her colleagues (Fiske 1982; Fiske and Pavelchak in press). According to this view, conscious, piecemeal processing of attribute information may be required for initial choices but becomes less evident over time. As judgments and choices are made over time, global evaluations would be formed for different brands as attribute information becomes better organized and integrated. Letter choices are made by referring to these global evaluations, thus bypassing systematic processing of attribute-related information.

Decision uncertainty appears to affect motivational levels in a slightly different way. The degree to which choices can be determined to be correct or optimal is likely to affect the perceived value of systematically processing attribute-related information. Perceived benefits are likely ~o be higher in cases where feedback is readily available regarding the appropriateness of the choices being made. These perceptions regarding the value of expending additional processing effort can then be expected to directly affect the motivation to process attribute-related information in a systematic manner. Although perfect feedback is seldom present in consumer choice situations, variations do occur in different settings and with different types of goods and services. Nelson's (1970) distinction between search and experience goods provides one such example. Nelson defines search goods as being those whose quality can be determined before purchase, while experience goods are those whose quality can only be discerned after experience. This distinction suggests that objective attribute comparison is both feasible and desirable for search goods (e.g. , the price of an airline ticket). However, such comparisons are less feasible and less likely to occur with experience goods (e.g., a physician's services). In this case, more heuristic forms of processing may be adopted using simple situational cues or random choice.

Ability to Process. Among the factors thought to influence ability to process, task effects seem to be particularly pervasive in number. Among these, characteristics of the choice set such as the number of alternatives and number of attributes per alternative play a most important role. Both dimensions contribute to greater information loads which tend to reduce the ability to process the full range of available information. As a result, systematic processing is less likely to occur with a larger number of alternatives or a larger number of attributes per alternative. Previous findings in the choice area are consistent with this interpretation. For example, with increases in the number of alternatives, consumers tend to shift from one-stage compensatory strategies to multistage strategies involving a noncompensatory screening-by-attribute stage. Similar simplifying strategies are evident with increases in the amount of attribute information available per alternative. With increases in the amount of attribute information, consumers tend to differentially weight attributes, ignoring some attributes and basing decisions on a subset of available attribute information. Both sets of findings suggest that systematic process i ng occurs under relatively low information loads whereas heuristic approaches are employed as information load increases and the need for simplification of the choice task arises.

Presentation factors also influence the level of processing difficulty found in decision-making situations. Simultaneous presentation, for example, reduces the need to process previously stored information by providing relevant information to the consumer at one point in time. Attribute information provided in numerical form may also facilitate processing by providing information in a format that is easily incorporated into choice rules and strategies. Verbally-presented information, in contrast, may need to be translated into numerical terms in order to be processed efficiently. Presentation of information by brand may also facilitate processing by presenting information in a format most consistent with typical consumer information environments. Although this line of reasoning suggests that presentation by brand should enhance systematic processing, the possibility also exists that this format may encourage more heuristic forms of processing based on global evaluations rather than detailed attribute processing. This second possibility seems quite plausible in light of past evidence of reduced attribute processing with brand-based information formats. In sum, it appears that systematic processing Would be most likely to occur in less difficult processing environments represented by simultaneous presentations of attribute information in numerical form.

Time pressure and distraction constitute the final set of task factors thought to influence processing ability. Both factors affect the degree to which consumers are able to process attribute information in a careful and systematic manner. Distraction interferes with in depth processing whereas time pressure limits the amount of time available to consumers to process information in an extensive mariner. As a result, consumers are less likely to follow systematic approaches in situations involving either distraction or time pressure. Consistent with this interpretation, researchers have found that consumers process less attribute information and use fewer attributes in the presence of distraction or time pressure.

Context factors produce similar effects in influencing the level of processing difficulty. The most important factor in this regard is the similarity among available alternatives. Similarity is thought to influence processing difficulty by reducing the number of distinct attributes that need to be considered (Payne 1982). As alternatives become more similar, fewer attributes have ratings that are substantially different from one another. As a result, similarity is likely to affect choice processing in the same manner as variations in the number of alternatives. Systematic processing will occur in situations involving similar choice alternatives with few distinct attributes to consider. Heuristic processing appears more likely with more dissimilar alternatives as consumers attempt to reduce task complexity by employing noncompensatory strategies.

Finally, individual differences can contribute to the degree of processing difficulty in consumer decision making. Differences in prior knowledge and experience appear to have the most influence in this area. In contrast to other factors, the influence of prior knowledge and experience seems to be much more complex in nature. Although the ability to process information should be greater for more knowledgeable and experienced consumers, this heightened ability does not appear to translate into the use of systematic processing approaches in all cases. Specifically, consumers with moderate levels of knowledge and experience appear to engage in more extensive processing than consumers with either low or high knowledge/ experience levels. Although this finding seems rather inconsistent, recent thinking in several areas of psychology provides a plausible explanation. Effects such as these are quite consistent with Sherman and Corty's (1984) position that heuristic processing represents major judgmental principles of both very primitive and very advanced levels of cognitive functioning. Novice consumers may rely on simplifying principles because the choice task may be too complex and confusing for them to deal with adequately. Heuristics are needed to allow the novice to make choices with minimal confusion and cognitive strain. Experts may also rely on heuristics because their knowledge and familiarity has allowed them to have well-organized and articulated schemata that can reduce complex choices to almost routine and automatic tasks (Hayes-Roth 1977; Showers and Cantor 1985).

SUMMARY AND CONCLUSIONS

This paper has provided a preliminary framework for understanding contingent choice behavior. Distinctions between two basic approaches to consumer choice, systematic and heuristic, were drawn to describe variations in choice processing which Occur under different situations. Two factors in the choice situation, motivation to process and ability to process, were described as affecting the type of processing approach selected by consumers. Both factors were viewed as influencing the perceived costs and benefits to the consumer of processing information in a thorough and systematic manner. This model was then used to interpret and explain previous findings reported in the consumer choice literature.

This framework has several features in common with theoretical frameworks of contingent decision behavior developed by psychologists working in areas other than consumer choice (for a review, see Payne 1982). In particular, the model described here is quite similar in nature to one proposed by Beach and Mitchell (1978). These researchers identify categories of decision-making strategies ranging from analytic to nonanalytic strategies. Points on this range are characterized mainly by differences in the amount of resources required to use a particular strategy and differences in the ability of a particular strategy to produce an "accurate" response. The type of strategy selected on this continuum is then described as proceeding on the basis of a cost-benefit analysis relating the costs of applying specific decision strategies with the value of a "correct" decision.

In comparison, the model proposed here also characterizes different decision-making approaches based upon processing effort and specifies a type of cost-benefit analysis involving motivational and ability factors. Unlike the Beach and Mitchell framework, however, the model we have described does not stress "accuracy" as a factor distinguishing different choice approaches. Although systematic approaches were described as being more detailed and thorough in nature than simple heuristic approaches, systematic approaches were not necessarily viewed as resulting in more accurate or optimal choices. The model proposed here is also more general in terms of describing processing approaches and specifying factors affecting the choice between these approaches. The distinction between systematic versus heuristic approaches can be a useful characterization at almost any stage in decision making from initial information search to final selection. The major contingencies described by our model are also capable of accounting for the wide variety of situational and individual factors which influence consumer decision making.

Contingency frameworks such as these should be the focus of future research in the area of consumer choice. More attention needs to be devoted to developing or modifying conceptual frameworks which explain the many contingencies affecting consumer decision making. Attention could also be directed towards empirically testing the propositions of existing frameworks such as the one proposed here. Much remains to be done in generating specific testable propositions and in specifying ways to define and measure various types of contingencies.

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Authors

Deborah Roedder John, University of Wisconsin-Madison
Siew Meng Leong, National University of Singapore



Volume

SV - Historical Perspective in Consumer Research: National and International Perspectives | 1985



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