Worked example 1
After seeing a news report about a phone battery fire, Priya avoids that brand despite its high ratings. She buys a more expensive unbranded charger believing 'price means quality', and chooses a cereal because its mascot looks 'healthy and natural'. Identify the heuristics used and evaluate their usefulness for consumer decisions.
Show solution outline
Phone — availability heuristic: Vivid news report makes battery fires easily recalled → overestimated risk for that brand (Tversky & Kahneman). Ignores statistical base rate (millions of safe units).
Charger — price-quality heuristic: Higher price → assumed better quality without checking specifications or reviews. May pay premium for identical components.
Cereal — representativeness heuristic: Mascot appearance ('healthy, natural') judged as representative of product quality → stereotype replaces ingredient analysis.
Evaluate — advantages: Heuristics save time and cognitive effort — adaptive for low-involvement purchases (2.3.1) where full analysis is impractical. Brand heuristic often correlates with genuine quality.
Evaluate — disadvantages: Systematic errors — availability distorts risk perception; price-quality exploited by marketers (2.2.2 decoy pricing). Vulnerable consumers — elderly, rushed shoppers rely heavily on shortcuts. Marketing exploitation — packaging and mascots designed to trigger representativeness (2.4.1). Heuristics are efficient but not optimal.