thi sppt describes consumer behaviour buying decisions

2. Consumer Decision
Making Process
By-
Vaishali Sehrawat

3. Consumer Decision Making
•Process by which consumer identify their
needs, collect information, evaluate
alternatives and make purchase decision.
•These actions are determined by psychological
and economical factors, and are influenced by
environmental factors such as culture, group,
and social values.

5. Chapter 4 Version 3e 5
Types of Consumer Buying
Decisions
More
Involvement
Less
Involvement
Routine
Response
Behavior
Limited
Decision
Making
Extensive
Decision
Making
4

6. Routine Response Behavior
• Little involvement in selection process.
• May stick with one brand .
• Quick Decision .
• Frequently purchase low cost goods.
• Examples are soap , shampoo etc.

7. Limited Decision Making
• Moderate involvement in selection process
• Purchasing process is shorter
• Evaluation of few alternative brands
• Examples are clothing, cosmetics

8. Extensive Decision Making
• High level of involvement
• High cost goods
• Long time to decide
• Evaluation of many brands
• Examples are buying a car or an AC.

9. A simple model of consumer decision-
making:

10. 1. Input
Firms’ marketing strategies

11. Socio cultural environment

12. 2.The Process
1. Need Recognition
• The recognition of a need is likely to occur when
a consumer is faced with a “Problem”.
• The realization that there is a difference
between actual and desired states
– The higher the gap, the stronger the need (or bigger
the problem)
Ex. – Harish

13. 13
Need Recognition
Internal Stimuli
and
External Stimuli
Present Status
Preferred State
Marketing helps
consumers recognize
an imbalance between
present status and
preferred state
2

14. Problem Recognition and Marketing
Strategy
Two different need recognition:-
• 1. Actual:- who perceives that they have a problem when
a product fails to perform satisfactorily.
• 2. Desired:- for whom the desired for something new
may trigger the decision process.
(Since Harish didn’t owns a laptop; he appears to be a
Desired consumer)
Strategy
• Identify existing consumer problems and find solutions
for these
• Lower the actual state
• Increase the desired state
• Increase the importance of the gap between actual and
desired states

15. Pre-Purchase Search
• Prepurchase search begins when a consumer
perceives a need that might be satisfied by the
purchases and consumption of a product.
• The recognition of past purchase or experiences
might provide the consumer with adequate
information to make the present choice.
Modes
• Types of Information Sources
• Types of Information Sought
• Factors Affecting Extent of Information Search

16. Types of Information Sources
•PERSONAL
•Friends
•Neighbors
•Relatives
•Co-workers
•Computer salespeople
•Calling the electronics
store
•IMPERSONAL
•Newspaper articles
•Magazine articles
•Consumer Reports
•Direct-mail brochures
•Information from
product advertisements
•Internal web site

17. Types of Information Sought
• Brands or alternatives
available
• Evaluative criteria to be
used
– Generally, product
features
• Ratings of brands on
evaluative criteria

18. Factors that Increase the Level of Pre-
purchase Search
• Product Factors: Higher search when
– It is a long-lasting or infrequently used product
– There are frequent changes in product styling
– Large volume is purchased
– The price is high
– There are many alternative brands
– There is much variation in features

19. • Situational Factors: Higher search when:
– Experience is lower
– Previous experience was unsatisfactory
• Social Acceptability: Higher search when:
– Purchase is a gift
– Product is socially visible in use

20. • Value-Related Factors: Higher search when:
– Purchase is discretionary
– All alternatives have both positive and negative
qualities
– No agreement among users exists
– Conflicting information is available
– Other considerations exist

21. • Consumer Factors: Higher search when:
– Consumers are well-educated, have higher
income levels and are younger
– Consumers are low in dogmatism and risk
perception
– Level of involvement is high
– Shopping is seen as an enjoyable activity

22. 3. Output
• The Purchase
Consumers will (obviously) eventually decide whether
or not to purchase a particular product. There are a
few behaviors that we can learn from their ultimate
decision:
– Trial purchases — some consumers purchase just to try a
product, usually to evaluate the product and brand
– Repeat purchases — other consumers will find that the
product is satisfactory and repurchases
– Long-term commitment purchases — some products
require commitment, where a trial purchase is not
possible; i.e. fridges, stoves, etc.

23. • Post-purchase evaluation
From prior expectations to the actual product
performance, consumers track their journey
and their perception is critical in evaluating
the product — whether they’re satisfied,
neutral, or dissatisfied.

24. Copyright © 2006 Pearson
Education Canada Inc.
14-24

25. MODELS OF CONSUMERS:
• Consumers approach the marketplaces
differently; they go though the buying
decision process differently as it gets impacted
by internal and external forces.
• Researchers have attempted to understand
the dynamics of consumer decision making
and they have classified four varying views.

26. 1. Economic view:
• According to this, the consumer is regarded as
being rational.
• The model assumes that there exists in the
market a state of perfect competition;
• The consumer is aware of the various
alternatives; he has the knowledge and ability
to rank all of these; and he finally takes a
rational decision.
• He takes a decision and makes a choice as after
taking into account the cost and benefit, and
the overall value in economic terms.

27. 2. Cognitive view
• The consumer is regarded as being a problem
solver, who searches for products to fulfill his
needs/wants.
• Consumer decisions are based on information
gathering and processing
• . The consumer is believed to take decisions
after a lot of thought and deliberation, so as to
get maximum benefit and value.

28. 3. Passive view
• Here, the consumer is regarded as irrational
and impulsive, who easily succumbs to the
selling and promotional efforts of the
marketer.
• It is assumed that the consumers are
submissive to the self-serving interests of the
marketer and the salespersons are powerful.

29. 4. Emotional view
• The consumer is regarded as being emotional
and impulsive, who takes decisions based on
moods and emotions.
• Marketers must put in efforts and create
positive mood and emotions.

30. Category based
Decision Making
FMCGs Durables

31. Segments , lifestyles and Consumer
Decision Making

32. • The figure shows four major groups or
classification :
• Need driven: (poor and uneducated).
• Outer directed: (middle or upper income
class consumer whose lifestyle is directed
by external criteria).
• Inner directed: (people motivated by inner
needs rather than by the expectation of
others).
• Integrated: (this group combines the best
of outer and inner directed. They are fully
matured).

33. • A further break-up of these groups is shown in the figure, and
their characteristics can be described as given below:
• Survivors: They are disadvantaged people, who are poor,
depressed and withdrawn. Their purchases are price
dominant, and they like to buy products which are economical
and suit their pocket. They are not very knowledgeable.
• Sustainers: They are motivated by brand names. They look for
guarantee and are impulse buyers. These people are
disadvantaged and want to get out of poverty.
• Belongers: They buy products which are popular. They are
careful and brand loyal shoppers. They are people who are
conventional, conservative, and unexperimental.

34. • Emulators: They are status conscious and upwardly mobile. They
emulate others, and buy products to impress other people. They
have high aspirations in life.
• Achievers: They buy top of the line products. They are brand
conscious and loyal. They are leaders and make things happen.
They want to enjoy a good life.
• I am me: These people are typically young, self engrossed and given
to whims. They go after fads and do not mind taking the lead.
• Experimentals: These people pursue a rich inner life and want to
directly experience what life has to offer.
• Societally conscious people: They are simple, frugal persons; who
read labels carefully and seek information. They are conscious of
society and social responsibility. They want to improve conditions in
society.
• Integrated: These are fully matured people and constitute the best
of outer and inner directed

37. fffddd5 Giver-Receiver Gifting
Subdivisons

38. Gifting Relationships

39. The Process of Gift- Giving

41. Reported Circumstances

42. Should I give
a gift to X?
What
shall I
give X?
Stop
Do I want to give X
something that X desires?
How do I learn
what X desires?
I’m not going to bother
learning recipient
preferences
Discern
preferences in any
unobtrusive way
Ask the
recipient
Identity
imposition
To you
for me
Outcome=Surprise
Outcome
= no
Surprise
Outcome=
Surprise
Outcome=
Surprise
Yes No

43. Beyond the Decision

45. A Simple model of Consumption

46. Relationship Marketing

47. • Relationship marketing has the aim
to building mutually satisfying long
term relationship with key parties in
order to earn and retain their
business.
• Relationship marketing builds
strong economic, technical and
social ties among the parties.

51. Consumers are less
loyal.. why???
• Availability of information
• Time Scarcity
• Availability of resources
• Entitlement

52. ACT OF PURCHASE
CUSTOMER SATISFACTION
CUSTOMER TRUST
CUSTOMER
COMMITMENT
CUSTOMER LOYALTY
A MODEL OF CUSTOMER LOYALTY