Abstract
We propose a structural model to investigate the impact of forgetting on consumers' brand choice decisions in frequently purchased products. Forgetting results in consumers imperfectly recalling their prior brand evaluations when making a purchase decision in the category. We conceptualize the imperfect recall by positing that consumers recall their prior evaluations with noise. Based on prior research in the behavioral area, we characterize the extent of forgetting as an increasing and concave function of time. Our framework generates analytical results on the impact of forgetting on consumers' brand evaluations and their consequent purchase behavior. We calibrate our model using scanner panel data for liquid detergents. Furthermore, we obtain insights into the consumers' extent of forgetting in the category, extent of learning, predicted price elasticities and implications on state dependence and habit persistence. Our results underscore the importance of modeling consumers' ability to recall only imperfectly.
Similar content being viewed by others
References
Alba, J.W., J.W. Hutchinson, and J.G. Lynch Jr. (1991). “Memory and Decision Making.” In H.H. Kassarjian and T.S. Robertson (eds.), Handbook of Consumer Behavior. Prentice Hall Professional, pp. 1–48.
Anderson, J.R. (1999). Learning and Memory: An Integrated Approach. Wiley, John and Sons.
Beattie, A.E. and A.A. Mitchell. (1985). “Advertising Recall and Persuasion.” In L.F. Alwitt and A.A. Mitchell (eds.), Psychological Processes and Advertising Effects: Theory, Research and Applications. Hillslade, NJ: Lawrence Erlbaum Associates, pp. 129–155.
Beihal, G. and D. Chakravarti. (1983). “Information Accessibility as a Moderator of Consumer Choice,” Journal of Consumer Research 10(June), 1–14.
Blattberg, R.C. and C.J. Wisniewski. (1989). “Price Induced Patterns of Competition,” Marketing Science 8(4), 291–299.
Chintagunta, P., D. Jain and N. Vilcassim. (1991). “Investigating Heterogeneity in Brand Preference in Logit Models for Panel Data,” Journal of Marketing Research 28, 417–428.
Collins B.E. and M.F. Hoyt. (1972). “Personal Responsibility for Consequences. An Integration and Extension of Forced Compliance Literature,” Journal of Experimental and Social Psychology 8, 558–593.
Cook, T.D. and B.R Flay. (1978). “The Persistence of Experimentally Induced Attitude Change,” Advances in Experimental Social Psychology 11, 1–57.
Erdem, T. and M.P. Keane. (1996). “Decision-Making Under Uncertainty: Capturing Dynamic Brand Choice Processes in Turbulent Consumer Goods Markets,” Marketing Science 15(1), 1–20.
Fazio, R.H. and M.P. Zanna. (1981). “Direct Experience and Attitude Behavior Consistency.” In Leonard Berkowitz (ed.), Advances in Experimental Social Psychology, vol. 14, pp. 161–202.
Fazio, R.H. (1990). “Multiple Processes by Which Attitudes Guide Behavior: The MODE Model as an Integrative Framework.” In M.P. Zanna (ed.), Advances in Experimental Social Psychology. San Diego CA: Academic Press, vol. 23, pp. 75–109.
Gonul, F. and K. Srinivasan. (1993). “Modeling Unobserved Heterogeneity in Multinomial Logit Models: Methodological and Substantive Implications,” Marketing Science 12, 213–229.
Guadagni, P.M. and J.D.C. Little. (1983), “A Logit Model of Brand Choice Calibrated on Scanner Data,” Marketing Science 2(3), 203–238.
Hastie, R. and B. Park. (1986). “The Relationship between Memory and Judgment Depends on Whether the Judgment Task is Memory Based or On-line,” Psychological Review 93(July), 258–268.
Heckman, J.J. (1981). “Statistical Models for Discrete Panel Data.” In C. Manski and D. McFadden (eds.), Structural Analysis of Discrete Data. Cambridge: MIT Press.
Johnson, H.H. and T.A. Watkins. (1971). “The Effects of Message Repetition on Immediate and Delayed Attitude Change,” Psychonomic Science 22, 101–103.
Kim, J.G. (2002). “Three Essays on Bayesian Choice Models,” Unpublished Dissertation, Department of Marketing, Rotman School of Management, University of Toronto.
Lichtenstein, M. and T.K. Srull. (1985). “Conceptual and Methodological Issues in Examining the Relationship between Consumer Memory and Judgment.” In L.F. Alwitt and A.A. Mitchell (eds.), Psychological Processes and Advertising Effects: Theory, Research and Applications. Hillslade, NJ: Lawrence Erlbaum Associates, pp. 113–128.
Lynch, J.G. Jr., H. Marmonstein, and M.F. Weigold. (1988). “Choices from Sets Including Remembered Brands: Use of Recalled Attributes and Prior Overall Evaluations,” Journal of Consumer Research 15(Sept.), 225–233.
Mehta, N., S. Rajiv, and K. Srinivasan. (2003). “Price Uncertainty and Consumer Search: A Structural Model of Consideration Set Formation,” Marketing Science 22(1), 40–57.
Miller, R.A. (1984). “Job Matching and Occupation Choice,” Journal of Political Economy 92(6), 1086–1120.
Mitchell, A.A. (1993). “Attitude towards the Advertisement Effects Over Time and in Attitude Change Situations.” In A.A. Mitchell (ed.), Advertising Exposure, Memory and Choice. Lawrence Erlbaum Associates, Inc.
Mullainathan, Sendhil. (2002). “A Memory Based Model of Bounded Rationality,” Quarterly Journal of Economics CXVII(3), 735–774.
Nedungadi, P. (1990). “Recall and Consumer Consideration Sets: Influencing Choice without Altering Evaluation,” Journal of Consumer Research 17(December), 263–276.
Papageorgis, D. (1963), “Bartlett Effect and the Persistence of Induced Opinion Change,” Journal of Abnormal and Social Psychology 67, 61–67.
Park, C.W., E.S. Iyer, and D.C. Smith. (1989). “The Effects of Situational Factors on In-Store Grocery Shopping Behavior: The Role of Store Environment and Time Available for Shopping,” Journal of Consumer Research 15(March), 422–433.
Ronis D.L., M.H. Baumgardner, M.R. Leppe, J.T. Cacioppo, and A.G. Greenwald. (1977). “In Search of Reliable Persuasion Effects: I. A Computer Controlled Procedure for Studying Persuasion,” Journal of Personality and Social Psychology 35, 548–569.
Roy, R., P.K. Chintagunta, and S. Haldar. (1996). “A Framework for Analyzing Habits, “Hand-of-Past,” and Heterogeneity in Dynamic Brand Choice,” Marketing Science 15(3), 280–299.
Rubin, D.C. and A.E. Wenzel. (1996). “One Hundred Years of Forgetting: A Quantitative Description of Retention,” Psychological Review 103(4), 734–760.
Sanbonmatsu, D.M. and R.H. Fazio. (1990). “The Role of Attitudes in Memory Based Decision Making,” Journal of Personality and Social Psychology 59(4), 614–622.
Seetharaman, P.B., A. Ainslie, and P.K. Chintagunta. (1999). “Investigating Household State Dependence effects across Categories,” Journal of Marketing Research 36(4), 488–500.
Watts, W.A. and W.J McGuire. (1964). “Persistence of Induced Opinion Change and Retention of Inducing Message, Content,” Journal of Abnormal and Social Psychology 68, 233–241.
Wilson, W. and H. Miller. (1968). “Repetition, Order of Presentation and the Timing of Arguments and Measures as Determinants of Opinion Change,” Journal of Personality and Social Psychology 9, 184–188.
Author information
Authors and Affiliations
Corresponding author
Rights and permissions
About this article
Cite this article
Mehta, N., Rajiv, S. & Srinivasan, K. Role of Forgetting in Memory-Based Choice Decisions: A Structural Model. Quantitative Marketing and Economics 2, 107–140 (2004). https://doi.org/10.1023/B:QMEC.0000027775.65062.50
Issue Date:
DOI: https://doi.org/10.1023/B:QMEC.0000027775.65062.50