How Organizations Use the CDP Model

February 2, 2010

Variables Shaping the Decision Process

Environmental Differences:

Culture

Social Class

Family

Personal Influence

Situation behaviors

Social Influences

Culture

Subcultures

Social class

Reference groups

Families and Households

Culture

Subcultures

Social class

Reference groups

Families and Households

Variables Shaping the Decision Process

Environmental Differences:

Culture: values, ideas, artifacts, and symbols that help individuals interpret, communicate, and evaluate as members of society

Variables Shaping the Decision Process

Environmental Differences:

Social Class: division within society composed of individuals sharing similar values, interests, and behaviors

Variables Shaping the Decision Process

Environmental Differences:

Family: often the primary decision making unit with a complex and varying pattern or roles and functions

Variables Shaping the Decision Process

Environmental Differences:

Personal Influence: our behaviors are often affected by those with whom we closely associate

Variables Shaping the Decision Process

Individual Differences:

Demographics, psychographics, values, and personality

Consumer resources

Motivation

Knowledge

Attitudes

Consumer Demographics

AgeAge

FamilyLife CycleFamilyLife Cycle

Education,IncomeEducation,Income

Religion Religion

Family Life Cycle Stages

Full Nest IFull Nest I

Single ParentsSingle Parents

Divorced and AloneDivorced and Alone

Middle-aged MarriedMiddle-aged Married

Full Nest IIFull Nest II

Empty NestEmpty Nest

Older SingleOlder Single

BachelorBachelor

Nine stages with different buying behavior

Nine stages with different buying behavior

Young MarriedYoung Married

Social Factors

Membership Reference (opinion leaders) Aspirational

Groups

Family

Roles & Status

Most important consumer buying organization

Role =Expected activities Status = Esteem given to role by society

Psychological Influences

Motivation

Perception

Learning

Personality

Attitude

Motivation

Perception

Learning

Personality

Attitude

Maslow’s Hierarchy of Needs

Perception

Process of receiving, organizing, and assigningmeaning to information or stimuli detected by our five senses

Process of receiving, organizing, and assigningmeaning to information or stimuli detected by our five senses

Personality

PsychoanalyticTheory

Hidden buying motivesDreams, hopes, fantasies, fears

PsychoanalyticTheory

Hidden buying motivesDreams, hopes, fantasies, fears

An individual’s pattern of traits that influencebehavioral responsesAn individual’s pattern of traits that influencebehavioral responses

Self-concept

ActualIdeal

Self-concept

ActualIdeal

Lifestyle & Psychographics

• Activities

• Interests

• Opinions

AttitudesLearned predisposition to respond to an object in a consistently favorable or unfavorable way

Learned predisposition to respond to an object in a consistently favorable or unfavorable way

What Is An Attitude?

ObjectManifested dimensionsand attributes

Cognitive ComponentBeliefs aboutthe object

Affective ComponentEmotions or feelingsabout the object

Conative ComponentBehavioral intentiontoward the object

AttitudeOverall expressiveorientation towardthe object

Variables Shaping the Decision Process

Environmental Differences:

Situation behaviors: as situations change, so does the individual’s behavior

Situational Factors

When consumers buy

Where consumers buy

Why consumers buy

Conditions under whichconsumers buy

When consumers buy

Where consumers buy

Why consumers buy

Conditions under whichconsumers buy

Situational Influences

TimeTime

SurroundingsSurroundings

Consumer Moods and Motives

Consumer Moods and Motives

TermsTerms

Types of Decision Processes

Consumer Decision Process Continuum

Midrange Problem Solving

Limited Problem Solving (LPS)

Extended Problem Solving (EPS)

High Low

Degree of Complexity

Consumer Decision Process Continuum: Repeat Purchases

Midrange Problem Solving

Habitual Problem Solving

Extended Problem Solving

High Low

Degree of Complexity

Limited Problem Solving

Types of Decision Processes

Initial Purchase

Extended Problem Solving (EPS): Problem solving of a higher degree of complexity that influences consumers actions

Types of Decision Processes

Initial Purchase

Extended Problem Solving (EPS):Often occurs with expensive items or can be fueled by doubts and fears

Importance in making the “right choice”

All seven consumer decision making stages are often activated

Dissatisfaction is often vocal

Types of Decision Processes

Initial Purchase

Limited Problem Solving (LPS): Problem solving of a lower degree of complexity that influences consumers’ actions

Types of Decision Processes

Initial Purchase

Limited Problem Solving (LPS):Consumers don’t have motivation, time, or resources to engage in EPS

Little search and evaluation before purchase

Need recognition leads to buying action; extensive search and evaluation often avoided as the purchase is not of great importance

Types of Decision Processes

Initial Purchase

Midrange Problem Solving:Many decisions occur along the middle of the continuum

Decisions are made with a minimal amount of time and only moderate deliberation

Types of Decision Processes

Repeat Purchases

Repeated Problem Solving

Habitual Decision Making

Types of Decision Processes

Repeat Purchases

Impulse BuyingUnplanned, spur-of-the-moment action triggered by product display or point of sale promotion (least complex form of LPS)

Repeated Problem Solving

Habitual Decision Making

Types of Decision Processes

Impulse Buying

Variety SeekingConsumers may be satisfied with the present brand but still engage in brand switching

Can be triggered because bored with current brand or because of special offer

Factors Influencing Problem Solving Extent

Degree of Involvement (High-Low)Personal Factors (self-image, health, beauty, or physical condition)

Product Factors (is there perceived risk in purchasing and using a particular brand or product?)

Situational Factors (is the product purchased for personal use or as a gift?)

Factors Influencing Problem Solving Extent

Time Availability How much time is available to devote to solving the problem?

How quickly does the decision need to be made?

Factors Influencing Problem Solving Extent

Time Availability How much time is available to devote to solving the problem?

How quickly does the decision need to be made?

Consumers’ Mood StateHow people feel at a particular moment

Mood can reduce or increase length and complexity of decision process

Thank You