Perceived Risk Model - Harvard Bussiness School Mid 60's

"Behaviour is said to depend upom an individual subjective perception of the risk inherent in buying a product - peoples tolerance to risk varies" - Harvard Bussiness School Mid 60's.

Involvement
Laurent and Kapferer '85, argue that a consumers level of involvement will be affected by these componants:

Importance and Risk (FTPEPS)
FINANCE - whats the financial risk?
TIME - How much time does it take to make this purchase decision?
PERFORMANCE - What is the risk of this item not performing to standards?
EGO - What will this purchase do for your ego?
PHYSICAL - What is the risk involved in this item causing harm?
SOCIAL - What will this purchase do for your social status?

The reulsts of FTPEPS will differ from purchase to purchase and from person to person. Eg. An 18 yr old buying a new mobile phone will have a HIGH importance rate of the SOCIAL risk, but compared to a 50 yr old it could be considered a LOW importance rate of the SOCIAL risk as a mobile phone is not as socially important to this age group.

Attention
In any Advert/Product/Brand the following items are normally used to grab the attention and stimulate a consumer:

MOVEMENT
CONTRAST
REPETITION
PRETTY PEOPLE
SIZE

These seem to be the best items that trigger selective attention of a consumer.

Perceptual Set
This is a selector and interpretoe that prevents us from problem solving sometimes as it fixes the focus of the mind.

Vernon (1955) - Psychology. "Individuals develop a persistent and deep rooted way of perceiving, thinking and believing. In other words everyone gets stuck in their own ways of thinking.

Gestalt Psychology
(Not a person but a way of thinking - psychology of the form)

Is there a rule book for how we think? Everyone seems to be different but studying this and the reasons why is incredibkly hard to do since the majortiy of people themselves do not know why they think the way they do.

We tend to focus on:
Foreground (The most obvious)
Groouping (Proximity and Simularity)
Closure (our brains need to make sense of things, complete and understand them)
Stimulus Ambiguity (Making sense of things that aren't quite normal)