Non-compensatory (and Compensatory) Models of Consideration-Set Decisions

If customers do not consider your product, they can’t choose it. There is evidence that 80 % of the uncertainty in choice models can be explained by simply knowing the consideration set (Hauser 1978). Many important managerial decisions rely on identifying how customers form consideration sets: Which features lead customers to eliminate certain products from further consideration? Which features lead customers to seek further information and thus open the op-portunity for a sale? How do technical specifications and quantifiable features of a product in-teract with more qualitative features such as service or reliability? Does “brand ” drive considera-tion? And what can a firm do about it? This problem is real. Even though a Buick was tied in 2008 with Lexus as the top-ranked automobile on a J. D. Power dependability study, was the top-ranked American car by Consumer Reports, and produced cars from the top-ranked US factory for quality, in 2008 few US consum-ers would even consider a Buick – in California almost two-thirds of consumers rejected GM cars without evaluating them; nationwide the percentage was closer to 50%. Investments in reli-ability, quality, safety, ride and handling, comfort, navigation, interiors, and Onstar become ir-relevant if consumers never get beyond the consideration stage. For this and other reasons, th