Why study Consumer Decision Making
What is consumer mind (Black Box)
Concepts - consumer decision, purchase involvement and
Types of consumer decisions
Roles of Consumer in C.D.M
Consumer Decision Making process
Need Recognition process
Information search process
Factors influencing C.D.M
Opening Case on Aarey Milk Diary.
So firms that choose not to understand their consumers
purchasing behaviour often lose out of the market.
An excellent engineered product may fail just because the
customer does not identify himself or herself with it.
The firm must understand the buyers purchasing
behaviour. Specially how the buyer decides, what
motivates him and who influences him.
The marketer needs to focus on “how and “why” of the
total experience consumers have with products and
service. (share examples)
Buyers continues to be an Enigma- sometimes responding the
why the marketer wants and on other hand occasions just
refusing to buy the product from the same marketer.- Black
The marketers provide stimuli but he is uncertain of the
buyers response. This stimuli is a combination of product
Company controlled Buy
Sales Promotion Response
Consumer mind(Black Box) No Buy
Word of mouth
A decision is a set of an options from two or more alternatives
So consumer decision produces an image of an individual
carefully evaluating the alternatives of a set of
products, brand or services and rationally selecting the one
that solves a clearly recognized need for the least cost.
Purchase involvement is the level of concern for, or interest
in the purchase process triggered by the need to consider a
Product involvement is the level of concern for a particular
brand or a product category.
Examples: Juice (purchase involvement ) Slice,
Mirinda, Thums up etc. (product involvement)
Nominal decision Limited decision Extended
making making decision making
Problem recognition Problem recognition
Information search Information search
Limited external External
Alternative evaluation Alternative evaluation
Information search Few attributes Many attributes
Limited internal Simple decision making Complex decision making
Few alternatives Many alternatives
Consumer decision processes are the decision making
processes undertaken by consumers in regard to a potential
market transaction before, during, and after the purchase of
a product or service.
The focus of this process, forms an integral part of consumer
behaviour on how consumers spend their available resources
(such as time and money) on personal and household products
and services so as to satisfy their needs.
The decision-making processes that consumers use when
making purchases vary, particularly with regard to the time
and effort that they take to reach a decision.
Problem recognition is the first stage in C.D.M process.
Problem recognition is the result of a discrepancy between a
desired state and a actual state that is sufficient to arouse
and activate the decision process.
Eg: Feeling Bored- actual state. Listening music/Call friend –
Types of Consumer Problem
Consumer problem may be either active problem or inactive
Active problems only require the marketers to convince
consumers that its brand is the superior solution.
Inactive problems require the marketer to convince
consumers that they have the problem and the marketers
brand is a superior solution to the problem which is more
Marketing Strategy used problem recognition
Discover Consumers problem
Responding to Consumer problem
Helping Consumer recognize problem
Suppressing problem recognition
Once problem is recognized relevant information from
long-term memory is used to determine if a satisfactory
solution is known, what are the characteristics of potential
solution are, what are appropriate ways to compare
solutions and so forth- This is called Internal search.
If a resolution is not reached through internal search, then
external search is focused.
It is important to note that even in extended decision
making with extensive external search, the initial internal
search generally produces a set of guides or decision
constraints that limit and guide external search.
Examples of External search: web, books, articles
newspaper, friends etc.
Types of Information
Evaluative Criteria: The desired characteristics are the
consumers evaluative criteria. Ex: Laptop or Computer
Appropriate Alternative: Here the consumer seeks for
different companies or brand Ex: Dell, HP Asus, Toshiba,
Evoked Set Inert Set Inept Set
These are the Which are Which are not
brands which known but not known
are know very the
When potential consumers have all the necessary internal
and external information on alternatives, they have to
evaluate the alternatives in order to make a purchase.
Information will lead to an evoked set(familiar brands) of
alternative products from which a choice will then have to
Theory of Evoked Set- By Howard and Sheth’s
Total Set Awareness Consideration
(all brands) Set Set
aware off) considered)
Consumers use several attributes when they are evaluating
alternative products and they are more interested in a
specific attribute that brings the sought benefits.
Example: Price, Quality, availability, service, performance
The number of criteria used in decision making are
relatively limited, usually less than six.
Also, not all criteria are equally important.
The criteria used to make a decision change depends on
the consumer, the product, and the situation.
Consumers generally make three types of purchase:
trial purchase, repeat purchase and long term
Trial purchase would be in smaller in quantity and it would
be also termed as Exploratory phase.
Repeat purchase is very closely related to brand
loyalty, which firms try to encourage because it
contributes to greater stability in the market share.
The purchasing process does not end when a consumer buys
a product . After the purchase consumers tend to evaluate
their experience to decide if they are satisfied or
The information will be used in future decision-making.
The performance of the product or service will be compared
with consumers expectations. There are three possible
outcomes of these evaluations:
Perceived performance meeting expectations
Perceived performance exceeding expectations
Perceived performance being lower than expectations
When a consumer thinks of the unique, positive qualities of
the brand not selected, it is known as cognitive dissonance.
When cognitive dissonance occurs Marketing can minimize through:
after a purchase, it is called Effective Communication
post purchase dissonance. Guarantees
Socio cultural Environment
Firms Marketing Efforts 1. Family I
1. Product 2. Informal sources N
2. Promotion 3. Other non commercial P
3. Price sources U
4. Channel of distribution 4. Social class T
5. Sub culture and culture
Consumer Decision Making
Need Psychological Field P
Recognition 1.Motivation R
Information 2.Perception O
Search 3.Learning C
Evaluation of 4. Personality E
Alternatives 5. Attitude S
2. Repeat purchase OUT PUT