The recognition heuristic in advertising
Anton and Sarah were shopping for their weekly groceries in their local supermarket. They bought their regular fresh fruits, vegetables, meat and dairy. As they started down the cleaning aisle Anton and Sarah were trying to decide which furniture polish to buy. They looked at the choice of polishes that were stocked in the aisle. There was a supermarket own-brand choice, two little known choices and a well-known brand. Anton remembered the well-known brand of furniture polish from a television advertisement with a comical cartoon character. There was little difference between the prices so Anton and Sarah decided to opt for the well-known brand that they remembered from the television advertisement.
Like the furniture polish brand companies spend great fortunes on making their products well-known. Millions is spent on brand communication with the goal of achieving the aided and unaided awareness of products. In 2007 and 2008 two large brands, Proctor and Gamble and Unilever spent $5.2 billion and $7.8 billion respectively. The substantial resources that are committed to promoting brand awareness shows the importance of establishing and retaining the awareness of a brand.
Because of the importance of brand awareness many companies and academics have sought to understand the decision processes that are involved when a consumer chooses one brand over another. In industry, a major US automobile brand invested substantial resources to study how they might persuade customers to choose their brand over their competitors. They found that although their brand had excellent new vehicles as judged by independent raters two thirds of US consumers did not consider their brand (Hauser et al., 2011). The automobile company lacked a memorable advertising campaign.
In academia, researchers at the Max Planck Institute have suggested a rule-of-thumb (i.e., heuristic) that attempts to explain why consumers choose one brand over another (Gigerenzer & Goldstein, 1999, 2011). In a now famous experiment where participants were given the names of two cities (e.g., Oxford or Lannion), and then asked to judge which of the two cities had the largest population, participants reliably choose the city they knew (i.e. Oxford) over the city that they did not (i.e. Lannion). The researchers recorded this rule-of-thumb as… If one of two objects is recognized and the other is not, then infer that the recognized object had the higher values with respect to the criterion. The researchers called this rule-of-thumb the recognition heuristic. In consumer psychology, the recognition heuristic works equally well when consumers are asked to choose one brand over another (Thoma et al., 2013; Oeusanthornwattana & Shanks, 2010).
In purchases with higher stakes (compared to simply buying a product in a shop) such as stock market investments the recognition heuristic is also of use. Imagine that you wish to invest a particular amount of money in stocks. If one person recognises a stock name over another they are more likely to choose the known stock over the unknown stock. Having a recognised stock name can increase the number of investors in a certain stock (Erdfelder et al., 2011).
In the case of Anton and Sarah shopping for their furniture polish it is clear why they choose the well-known brand over the unknown polish. The advertising campaign of the branded furniture polish with the comical cartoon character aided in the recognition of this brand thereby resulting in one more sale. If you multiple Anton and Sarah’s purchase by thousands or millions then you can clearly see the huge amounts of money that are involved. Many of us, like Anton and Sarah stick to brands we know simply because we know them, we buy the same cleaning products and food stuffs because of successful brand awareness campaigns that act on the recognition heuristic. Perhaps if we wish to avoid making unconscious choices based on the recognition heuristic we could simply try a different product, afterall the new product is not as we expect we can change back to our regular shopping pattern next time.