The Availability Heuristic in Consumer and Financial Decisions: Evidence from Consumer Reviews and Investment Patterns

Zekai Fei

2025

Abstract

The availability heuristic is a cognitive shortcut when people rely on examples immediately coming to mind. It is influential in consumer and financial behaviors. The research employs both theoretical analysis and review on empirical studies. For consumer behavior, online reviews and visual cues are used in the experiment to see how they will affect consumers’ choices. One experiment by Nazlan, Tanford, and Montgomery, used manipulations of rating formats and visual cues in online reviews. Another experiment, by Thoma and Williams, examined additional information in consumers’ brand choice. Financial behavior was examined with individual and institutional investor data to identify how different types of investors trade in response to market events. Results indicate that positive reviews with pictures significantly increase the odds of choosing a product, while negative reviews disproportionately impact due to negativity bias. Additionally, brand effect is a strong starting factor, but negative consumer reviews of a particular product significantly decrease the odds of well-known brands being chosen. In finance, individual investors are more vulnerable to recent news, trading volumes and extreme returns which leads to irrational decisions. Additionally, institutional investors are more rational and data-driven in their approaches.

Paper Citation

in Harvard Style

Fei Z. (2025). The Availability Heuristic in Consumer and Financial Decisions: Evidence from Consumer Reviews and Investment Patterns. In Proceedings of the 2nd International Conference on Applied Psychology and Marketing Management - Volume 1: APMM; ISBN 978-989-758-791-7, SciTePress, pages 621-627. DOI: 10.5220/0014149500004942

in Bibtex Style

@conference{apmm25,
author={Zekai Fei},
title={The Availability Heuristic in Consumer and Financial Decisions: Evidence from Consumer Reviews and Investment Patterns},
booktitle={Proceedings of the 2nd International Conference on Applied Psychology and Marketing Management - Volume 1: APMM},
year={2025},
pages={621-627},
publisher={SciTePress},
organization={INSTICC},
doi={10.5220/0014149500004942},
isbn={978-989-758-791-7},
}

in EndNote Style

TY - CONF

JO - Proceedings of the 2nd International Conference on Applied Psychology and Marketing Management - Volume 1: APMM
TI - The Availability Heuristic in Consumer and Financial Decisions: Evidence from Consumer Reviews and Investment Patterns
SN - 978-989-758-791-7
AU - Fei Z.
PY - 2025
SP - 621
EP - 627
DO - 10.5220/0014149500004942
PB - SciTePress