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CONSUMER DECISION MAKING
- By Vidushi Sharma
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quickly list 10 items you have purchased in the past
month
reexamine how long it took you to make a decisionon each
why did such a difference in decision occur?
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Types of Decision Making
1. Routinised response behavior/ Habitual buyingbehavior
Simple, low cost, frequent purchasing, not muchsearch for information, clear preference for brand.
2. Limited problem solving/ Dissonance reducingbuying behavior
New brand in known product class, moderateinformation search and time in choosing
3. Extensive problem solving/ Complex buying behavior Unfamiliar product class, criteria not known, need
for information search, longer time in decision.
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Routine Problem
Solving
Limited Problem
Solving
Extensive problem
Solving
Purchaseinvolvement level
Low Medium High
Problem
Recognition
Automatic Semiautomatic Complex
Information search
and evaluation
Minimal Limited Extensive
Purchasing
orientation
Convenience Mixed Shopping
Postpurchase
processes
Very Limited Limited Complex
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Buying Motives
Motive can be a strong desire, feeling, an urge from
within, a drive, stimulus or emotion which plays a
role in consumer decision to purchase a product.
Prof D. J. Duncan: those influences orconsiderations which provide the impulse to buy,
induce action or determine choicein purchase of
goods
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BUYING MOTIVES
Product motive Patronage motive
Emotional Emotional
Rational Rational
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INPUT
Need Recognition
Process Pre purchase Search
Evaluation Of Alternatives
Output Purchase
Post Purchase Evaluation
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Input:-
1. Firms Marketing Efforts
Product
Price
Place
Promotion
2. Socio-Cultural Environment
Family
Social classes
Culture and Sub-culture
Informal sources
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Need Recognition:-
Consumer recognizes a need when is faced with a
problem. Two types of problem recognition
Actual state type of problem
Desired state type of problem. Eg JAISALMER cigarette
Motivational Arousal :-
Satisfaction optimization: leisure and entertainment
Satisfaction maintenance: maintain status quo
Prevention of possible future problem
Problem avoidance
Conflict resolution: satisfying more than 1 need by 1
purchase
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Types of Problem Recognition :
Immediacy Of Solution
Expectancy
Of Problem
Routine Problem: Convenience goods, Grocery purchases
Emergency problem: ATM, credit cards Planning problem: Durable goods
Evolving problem: Fashion
Immediate solution
required
Immediate
solution not
required
Occurrence was
expected
Routine problem Planning problem
Occurrence
unexpected
Emergency
problem
Evolving problem
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Situations leading to problem recognition
Marketers understand such situations so that they
can remind the customers of such situations. Eg:
Dominos, Cadbury
1. Depleted or Inadequate stock of goods2. Discontentment with existing stock of goods
3. Changing financial circumstances
4. Marketing Efforts: try to create a gapbetween actual and
desired state
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Marketing helps consumers
recognize (or create) an
imbalance between present
status and preferred state
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Marketing Implications:
Marketer can segment customers on the basis oftheir motives. Eg TVS jive
Marketer can devise promotional campaignaccording to uniqueness of segment. Eg Dabur
Marketers can provide the consumer with the
opportunity to recognize their need for particulargoods and service. Eg Diamonds are ideal gift
Identify situations in which consumers are likely tomake purchases. De Beers- Wedding collection,
cadbury, Kurkure Marketers can manage marketing mix elements well
to take advantage of recognized problem situation.Eg Maruti Suzuki
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Information Search:
Once the need or problem is identified customer
starts seeking information.
Various sources of information are:
Own personal experience
Reading about product in mass media
A lecture on the product
Word of mouth Shop window display
Friends and relatives
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Type of Information sought by potential buyer
1. Evaluation Criteria: features to meet needs, price,
wash capacity, power
consumption, heater facility,
drying facility2. Appropriate alternatives : various brands available
to satisfy the criteria
3. Alternative characteristics: gather information on
each brand on eachpertinent evaluative
criteria.
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Information collection & processing
SET NAME EXPLANATION INFORMATION IMPLICATION
Awareness Set Consist of all the brands that
the customers knows of
Customer collects preliminary
information on these brandsand scrutinizes them in a
cursory fashion
Inept Set Customer definitely finds it
unworthy of consideration
Consumer is not interested in
any information on the
brand(s) in this set
Evoked Set Based on preliminary
investigation customer finds
them worthy of further
attention
customer is interested in
gathering as much information
as is needed for decision
making on these brands
Inert Set Consumer is indifferent
towards these choices
These brands are acceptable if
none of the brands from the
evoked set can be bought.
Thus, while consumer is not
actively seeking information
on these brands, he passively
accepts information on them.
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The information search
An internal search involves the scanning of one'smemory to recall previous experiences or knowledge
concerning solutions to the problem-- often
sufficient for frequently purchased products.
An external search may be necessary when pastexperience or knowledge is insufficient, the risk of
making a wrong purchase decision is high, and/or the
cost of gathering information is low.
Personal sources (friends
and family)
Public sources (rating
services like Consumer
Reports)
Marketer-dominated
sources (advertising orsales people)
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External Search:
Information in memory is missing, inadequate, or issuspect, then an external search is required.
Amount of external search activity depends upon:a. Perceived value vs perceived cost:
Financial cost
Time cost
Physical cost
Psychological cost
b. Individual factors:
Experience with a product
Open mindedness and self confidence of consumer
Educational level income status
Degree of involvement
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c. Situational Factors:
Urgency of need and availability of time
Special opportunities arise to purchase at anattractive prices.
d. Risk Factor:
Functional/ Performance risk
Financial risk Psychological risk
Social risk
Physiological risk
e. Types of product sought:
Shopping goods
Convenience goods
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Marketing Implications :
Marketer can make the task easy for customer like
finding the information, understanding it and using
it.
Marketer can minimize both risks and costs to theconsumer in making product selection.
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Evaluation of Alternatives
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Evaluation criteria are the various features that a
customer looks for in a response to a particular type of
problem.
Tangible criteria: price, color, size, shape etc
Intangible criteria: brand image, feeling associated with
ownership
Evaluation criteria differ in number, type and
importance.
It varies with customer, product, situation.
Eg purchasing a pair of jeans Number of evaluation criteria depends on importance
of purchase
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Non compensatory decision rules
The weakness of a possible alternative not
offset by its strength.
All the criteria should be satisfactory for
purchase.
Compensatory decision rules
Trade off while comparing alternatives
Weighted rating is used.
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Marketing Implications
Evaluation is comparative: ensure own brands are
rated superior
Educate the customers on criteria that should beused for evaluation.
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Purchase Behavior
Type of purchase
Trial purchase or
First timepurchase Repeat purchase
Long term
commitmentpurchase
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Post purchase evaluation
Experiences are judged against expectations
1. Neutral feelings
2. Satisfaction : Positive disconfirmation of
expectations
3. Dissatisfaction : negative disconfirmation of
expectations
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think of an important purchasing decision you
have made
what are some of the thoughts you have had
following your purchase? Any regrets?
what has influenced those thoughts?
how have you dealt with the discomfort?
how has the company anticipated or dealt with
your discomfort?
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Postpurchase Behavior
Can minimize through:Effective Communication
Follow-upGuaranteesWarranties
Underpromise & overdeliver
Cognitive Dissonance
?Did I make a good decision?Did I buy the right product?
Did I get a good value?
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Cognitive Dissonance
psychological discomfort caused byinconsistencies among a persons
beliefs, attitudes, and actions
varies in intensity based on importance
of issue and degree of inconsistency
induces a drive state to avoid or
reduce dissonance by changing beliefs,
attitudes, or behaviors and therebyrestore consistency
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Strategies to reduce dissonance
Rationalize the decision to be wise
Look for advertisements to support their choice
Persuade others to buy the same brand
Meeting satisfied owners for reassurance
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