Defining And Assessing The Effects Of Attribute Incoherence
Ujwal Kayandé, John Roberts, Gary L. Lilien
Abstract
Ujwal Kayandé, John Roberts, Gary L. Lilien
Abstract
Consumers are known to form expectations of typical configurations of attributes in a product, based on beliefs of inter-attribute covariation in the product category. Using their interattribute covariation beliefs, consumers may infer likely levels of one attribute based on the observed levels of other attributes. In this paper, we examine the case where the observed level of an attribute in a product is very different from what the consumer would infer, given the level of the other attributes. We are interested in the effect of such a combination of attributes on perceptions, uncertainty, preference, and purchase. We call such a combination or configuration of attributes in a product ‘incoherent’, where a consumer must integrate discrepant information from a number of sources. We develop a model of the effect of one particular form of incoherence, unusual attribute combinations, on the consumer’s perception of attribute levels, uncertainty, and preference. Our model implies that a product that combines positively valued attributes might increase some elements of preference for the product, but if those attributes occur in unexpected combinations, incoherence will also increase uncertainty, and potentially lower other elements of preference. The net risk-adjusted evaluation of a product in our model accommodates both the benefit from the expected attribute levels and the multi-dimensional uncertainty associated with incoherence. We derive implications of the model and provide an empirical test that supports those implications. We discuss how the model can be used for product repositioning and new product development.
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Consumers are known to form expectations of typical configurations of attributes in a product, based on beliefs of inter-attribute covariation in the product category. Using their interattribute covariation beliefs, consumers may infer likely levels of one attribute based on the observed levels of other attributes. In this paper, we examine the case where the observed level of an attribute in a product is very different from what the consumer would infer, given the level of the other attributes. We are interested in the effect of such a combination of attributes on perceptions, uncertainty, preference, and purchase. We call such a combination or configuration of attributes in a product ‘incoherent’, where a consumer must integrate discrepant information from a number of sources. We develop a model of the effect of one particular form of incoherence, unusual attribute combinations, on the consumer’s perception of attribute levels, uncertainty, and preference. Our model implies that a product that combines positively valued attributes might increase some elements of preference for the product, but if those attributes occur in unexpected combinations, incoherence will also increase uncertainty, and potentially lower other elements of preference. The net risk-adjusted evaluation of a product in our model accommodates both the benefit from the expected attribute levels and the multi-dimensional uncertainty associated with incoherence. We derive implications of the model and provide an empirical test that supports those implications. We discuss how the model can be used for product repositioning and new product development.
Key concepts: Preference, Product (mathematics), Perception, Product category, Econometrics, Computer science, Mathematics, Psychology