Judgment and Decision Making, Vol.X, No.X, May 2011, pp. XX–XX

A Marketing Science Perspective on Recognition-Based Heuristics (and the Fast and Frugal Paradigm)
John Hauser∗
Abstract Marketing science seeks to prescribe better marketing strategies (advertising, product development, pricing, etc.). To do so we rely on models of consumer decisions grounded in empirical observations. Field experience suggests that recognition-based heuristics help consumers to choose which brands to consider and purchase in frequently-purchased categories, but other heuristics are more relevant in durable-goods’ categories. Screening with recognition is a rational screening rule when advertising is a signal of product quality, when observing other consumers makes it easy to learn decision rules, and when firms react to engineering-design constraints by offering brands such that a high-level on one product feature means a low level on another product feature. Experience with applications and field experiments suggests four fruitful research topics: deciding how to decide (endogeneity), learning decision rules by self-reflection, risk reduction, and the difference between utility functions and decision rules. These challenges also pose methodological cautions. Keywords: Consideration Sets, Ecological Rationality, Evaluation Cost Model, Fast and Frugal Heuristics, Selfreflection Learning, Non-compensatory Decision Rules, Product Development, Recognition Heuristic.

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A Marketing Science Perspective

Marketing science provides a valuable perspective on whether and why consumers use recognition-based heuristics.1 This perspective is grounded by field experiments, the analysis of large data sets such as those obtained from supermarket-scanner panels, formal theory, prescriptive applications, and managerial experience. This perspective complements the theories and experiments in the