Consumer Behavior 101: Consumer Decision Making Process - Problem Recognition Need vs. Opportunity Recognition

What It Is

Problem Recognition is the process by which consumers become aware of a need or opportunity in the market, leading to a desire to purchase a product or service. A classic example of problem recognition is the introduction of Tide laundry detergent by Procter & Gamble in the 1940s. Before Tide, consumers had to manually wash and rinse their clothes, a time-consuming and labor-intensive process. Tide's innovative formula and marketing campaign effectively communicated the benefits of using a detergent, creating a new need in the market and driving consumer adoption. Understanding problem recognition is crucial for marketers to develop effective strategies that resonate with consumers and drive sales.

Key Terms & Concepts

• Need Recognition: The process by which consumers become aware of a need or desire for a product or service. (Example: A consumer realizes they need a new phone after their old one breaks.)
• Opportunity Recognition: The process by which consumers become aware of a new or improved product or service that meets an existing need. (Example: A consumer discovers a new restaurant in their neighborhood that offers a unique dining experience.)
• Pavlov's Classical Conditioning (1927): A learning theory that explains how consumers associate stimuli with responses. (Example: A consumer learns to associate the sound of a coffee shop's espresso machine with the taste of freshly brewed coffee.)
• Fishbein's Multi-Attribute Model: A model that explains how consumers evaluate products based on multiple attributes. (Example: A consumer evaluates a new car based on its price, fuel efficiency, and safety features.)
• Weber's Law: A law that explains how consumers perceive differences in stimuli. (Example: A consumer can detect a difference in the taste of two similar coffee blends.)
• Actual Self vs. Ideal Self: A distinction between a consumer's current self and their desired self. (Example: A consumer's actual self is a busy professional, but their ideal self is a fitness enthusiast.)
• Self-Concept: A consumer's perception of themselves and their place in the world. (Example: A consumer's self-concept is influenced by their social media profiles and online interactions.)
• Need Hierarchy: A theory that explains how consumers prioritize their needs. (Example: A consumer's basic needs, such as food and shelter, take priority over their higher-level needs, such as entertainment.)
• Maslow's Hierarchy of Needs: A theory that explains how consumers prioritize their needs. (Example: A consumer's physiological needs, such as hunger and thirst, take priority over their safety needs.)
• Opportunity Cost: The cost of choosing one option over another. (Example: A consumer chooses to spend money on a new phone instead of saving it for a down payment on a house.)
• Scarcity Principle: A principle that explains how consumers respond to limited availability. (Example: A consumer is more likely to buy a product if it is scarce or hard to find.)

Common Misunderstandings

• Misunderstanding: Problem recognition is the same as need recognition.
• Correction: Problem recognition is a broader concept that includes both need recognition and opportunity recognition. (Source: Kotler & Keller, Marketing Management, 14th ed.)
• Misunderstanding: Fishbein's Multi-Attribute Model only applies to product evaluation.
• Correction: Fishbein's Multi-Attribute Model can be applied to any decision-making process, including service evaluation and personal relationships. (Source: Fishbein & Ajzen, Belief, Attitude, Intention, and Behavior, 1975)
• Misunderstanding: Weber's Law only applies to sensory perception.
• Correction: Weber's Law can be applied to any decision-making process that involves evaluating differences between stimuli. (Source: Weber, The Sense of Touch, 1834)

Quick Application / Identification

Scenario: A consumer is browsing through a clothing store and comes across a new brand of jeans that they have never seen before. The jeans are made from sustainable materials and have a unique design. The consumer is unsure if they want to try them on.

• Task: Identify the concept that is occurring in this scenario.
• Answer: Opportunity recognition.
• Explanation: The consumer is becoming aware of a new product that meets an existing need (comfortable and stylish jeans), which is an example of opportunity recognition.

Last-Minute Revision

• Pavlov's Classical Conditioning (1927)
• Fishbein's Multi-Attribute Model
• Weber's Law
• Need Hierarchy
• Maslow's Hierarchy of Needs
• Opportunity Cost
• Scarcity Principle
• Need Recognition
• Opportunity Recognition
• Actual Self vs. Ideal Self
• Self-Concept
• Kotler & Keller, Marketing Management, 14th ed.
• Fishbein & Ajzen, Belief, Attitude, Intention, and Behavior, 1975
• Weber, The Sense of Touch, 1834
  Don't confuse need recognition with opportunity recognition.
  Fishbein's Multi-Attribute Model is not limited to product evaluation.
  Weber's Law applies to any decision-making process involving differences between stimuli.