How consumers’ search strategies affect their purchases
Understanding how shoppers search for a product can help businesses more effectively promote their brands
- The search method consumers use to compare products—either “sequential” or “simultaneous”—affects which brands they consider and what they eventually buy, according to Chicago Booth’s Pradeep K. Chintagunta and the University of Texas at Dallas’s Elisabeth Honka.
- In a sequential search, consumers go through each brand one by one until they find one they like. In a simultaneous search, shoppers identify a group of products to compare and buy the best option from this set.
- When shopping for car insurance, drivers in a hurry to get insured and those prone to traffic accidents prefer the simultaneous-search method, say the researchers. Drivers who have more time are likely to conduct a sequential search.
- The researchers find that sequential searches favor the largest insurance companies, while smaller companies fare better when consumers examine more options at the same time (see chart). Bigger companies with brand recognition can entice consumers to find and choose them right away, but when consumers cast a wider net, smaller companies have a better chance of grabbing market share with competitive pricing.