Tuesday, November 04, 2014

beanz meanz recognition validity

While much of the debate around heuristics and biases tends to focus on how mental shortcuts can lead to less than optimal decision making, it's worth noting that this is not always the case - indeed fast, simplified decision rules often result in better choices.

Where less knowledge is actually better than more in order to make a particular inference.

According to Gigerenzer the recognition heuristic is one such shortcut that we consumers routinely apply without thinking and derive a kind of counterintuitive less-is-more effect. 

Think of this as ‘brand fame’, in it’s simplest sense.

A 'fame' in which recognised items or brands will be chosen over unrecognised ones, regardless of any other available relevant information. 

This is important because it gives us a better clue about how brands are selected in actual real buying situations versus hypothetical ones.

For instance, when asked to name as many brands in a specific category as possible, people can rarely name more than a few.

However when read a list of brands in a category, people are usually aware of much more than just a few. When prompted they can name loads more.

The problem is that in real-life buying situations the brands that come to mind automatically are the only ones that matter. 

So, unaided salience is a slightly better predictor of the brands that may come to mind in a real buying situation, though still not perfect.

So, onto Gigerenzer's model of recognition validity.

On the right-hand side of the diagram above we see partially ignorant consumers (that's you and me); we have limited brand name recognition, limited (if any) brand knowledge, but we are in a goal-oriented situation, getting the weekly shopping in.

On the left is what we are trying to infer (a quality), in order to determine which beans to buy.

On the top, there are the 'mediators' in the environment, such as news media, advertising (Beanz Meanz Heinz) , word of mouth, stuff we've 'heard about', what we did last time and what we've observed other people do.

The 'quality' (some sort of cue or whichever attribute we need in order to pick) of a brand can be inferred by how many associations that we can make, and the quality of those associations.

Over time, we implicitly learn that heavily advertised brands are of a high quality, and because advertising causes salience of the brand name, and salience we can infer high quality from recognition alone.

For the brand itself this is extremely significant as consumers unconsciously screen out competing brands – they don’t even get noticed.

But it gets even better when we can learn by observing what other consumers do (popularity), in turn this also reinforces recognition. 

Then the more times we use a particular brand the usage itself leads to further recognition.

We still have no more brand knowledge but don't need it, less knowledge is actually better than more.

In turn, the more often a brand name is mentioned by the mediator(s) , the more likely it is that a person will have heard of the name, regardless of its actual quality. 

The recognition heuristic is a probably a very close cousin of what Byron Sharp would call ‘mental availability’.

Buyers use different cues when retrieving brands as buying options.
They may be totally unaware of the cues they are utilising.
No consumer is wedded to one attribute all the time.
The typical buyer might be thinking healthy one time, convenient next time and a treat the time after. Buyers use different attributes at different points in time. ‘

How the recognition heuristic works in short:

- Impact of quality: high-quality objects are mentioned more often than low-quality objects. 

- Impact of publicity: those that are mentioned more often are recognised more often

Recognition validity: those that are recognised more get bought more.

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