27758691 Consumer Decision Making

7/30/2019 27758691 Consumer Decision Making

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ByRachita Jayswal,Lecturer.


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A decision is a choice between two or more

alternative actions or behaviors For Example: A housewife goes to purchase a

mid priced range of tea, than making aselection from the various brands of tea like

Taj Mahal, Tata Tea, Red label, Yellow label,etc. than she is making decision.


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ConsumerDecisions

Consumer decisions are decisionsconsumers make in the marketplace

involving:

whethertopurchase

whattopurchase

when topurchase

fromwhom topurchase

howtopayforthepurchase


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Routine Limited Extensive

Involvement Low Low to

moderate

High

Time Short Short to

moderate

Long

Costs Low Low tomoderate

High

Information

search

Internal only Mostly internal Internal and

external

Number of

alternatives

One Few Many


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Routinized Response Behavior:

Marketer must continue to provide satisfaction to theexisting customer

Marketer must attract new customer by using

promotional schemes and introduced new features tothe product. Limited Problem Solving: Marketer should design the communication

programme that will help The buyer to gather more information, Increase his brand comprehension and

Gain confidence in the brand.


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Extensive Problem Solving:

Marketer must educate the prospective buyers

About the attributes of the product,

Their relative importance and High standing of the marketers brand on brand

attributes.

So, the marketer should do marketingcommunication which help the consumer to

evaluate and feel good about his / her brand

choice.


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InputFactorsare:

Marketingmix

activities

of

organization

(Marketing

Inputs)

Socialcultural Influences

(Socialcultural Inputs)


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Marketingstimuliconsistof4Ps Marketer

are

interested

in

knowing

how

consumerwillrespondtovariousstimuli. Thesemaybeintheformof:

Productfeature

site

Packages

Suitableprices

Massmedia

advertising

Personalselling

Directmarketing

Selection

of

suitable

distribution

channel


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It nonmarketing influences the consumer

purchase decision. Social Cultural factors includes the family,

social class, culture and sub culture, informalsources and other non commercial sources.

For Example: the comment of a friend, an

editorial in the newspaper, usage by a family

member, an article in Consumer Reports or

the view of an experienced customer.


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Processcomponentofthemodelis

concernedwith

how

consumer

make

decisions. Thepsychologicalfieldrepresentinternal

influencesthat

affect

consumer

decision

makingprocesses. whattheyneedorwant

Theirawarenessofvariousproductchoices

Theirinformationgatheringactivities

Theirevaluation

of

alternatives


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Evaluation of Alternatives

Information Search

Need Recognition


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Consumer recognized

need when they faceproblem.

Among consumer thereare varied types of need

or problem recognition:

Actual state type of

problem

Desire state consumer


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Actual State consumer: This occur when

product is not performing satisfactorily. Ex.: The housewife may realize that the mixer

she was using doesnt grind properly. Desired state consumer: The consumer may

experience the desire for something new.

Ex.: A newly married man desire to possess a

motor cycle.


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Simple problem recognition: Need that occur

frequently and can be dealt with automatically. For Ex.: Feeling thirsty and not having Pepsi. Complex problem recognition: Need occur

over a period of time and the actual and desirestate gradually move apart.

For Ex.: a man who was driving a scooter formany years consider selling it and going fornew scooter so as to reduce the maintenance

charges.


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Internal Stimuliand

External Stimuli

Present Status

PreferredState

Marketinghelps

consumersrecognizeanimbalancebetweenpresentstatusandpreferredstate


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Chapter5Version6e 16

Anyunitofinputaffectingoneor

moreof

the

five

senses:

sight

smelltaste

touch

hearing


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Consumergathersinformationrelatedtotheirattainmentofthedesired

stateofaffairs

Internalsearch apassiveapproachtogathering

informationinwhichtheconsumersownmemory

isthemainsourceofinformationaboutaproduct

Externalsearch a

proactive

approach

to

gathering

information

in

which

theconsumercollectsnewinformationfromsourcesoutsidethe

consumersownexperience

MarketingcontrolledNonmarketingcontrolled


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Sources of InformationMarketerControlled

Advertising

Salespersons Brochures

Store

displays CompanyWebsites

Nonmarketer Controlled

Friendsandfamily

Pastexperience

Publicinformation

Experts

Internet


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Systematicsearch involvesacomprehensivesearch

and

evaluation

of

alternatives

Extended problemsolving

Limited problemsolving

Heuristicsearch involvestheuseofquickrulesofthumbandshortcuts Routine problemsolving


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The amount of search depends on:

Perceived risk Involvement

Familiarity and expertise

Time pressure Nature of the product

Amount of information overload

Ifperceived risk is high than complex informationsearch and when the perceived risk is low thanconsumer likely to use very simple and

evaluation techniques.


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Experience

SocialAcceptabilityoftheproduct

Value

related

consideration


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For evaluation consumer tend to use two

types of information:

List of brands that they plan to make their

selection (The Evoked Set) The criteria they will use to evaluate each

brand


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ALLBrands

UnknownKnownBrands

OverlookedBrands

IndifferentBrands

UnacceptableBrands

AcceptableBrands

NotpurchasedBrands

PurchasedBrands


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Unknown Brand: Consumer selective exposure

in to advertising media and selective perceptionof advertising stimuli.

Unacceptable Brands: Poor qualities or

inappropriate positioning in advertising orproduct characteristics.

Indifferent Brands: Perceived as not having

special benefit. Overlooked Brands: Not clearly positioned or

sharply targeted at the consumer marketsegment


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Promotional technique should be deigned to

impart favorable and relevant product imageto the target consumers.

Change in product features or attributes. Invite consumers in a particular target

segment and try to put in their evoked ser


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ConsumerDecisionRulereferredas:

Heuristicevaluation choosingamongalternatives

withoutformalized

steps

to

arrive

at

adecision

Suchastheuseofintuition

Simplychoosing

by

relying

on

agut

level

feeling

Systematicevaluation choosingamongalternatives

byusing

aset

of

formalized

steps

to

arrive

at

adecision

Multiattribute model:highestoveralljudgment

Linearcompensatory:globalscore

Lexicographicapproach:rankorderattributes


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ConsumerDecisionrulesarebroadlyclassified

intotwo

major

category:

Compensatorymodel

Noncompensatory models

Conjunctivemodel

Disjunctivemodel

Lexicographicmodel


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With the compensatory model the

consumer arrives at a choice by

considering all of the attributes and

benefits of a product or service andmentally trading off the alternatives

perceived weakness on one or moreattributes for its perceived strength on

other attributes


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Performance Levels on Evaluative

Criteria for Six Notebook ComputersEvaluative

Criteria

Alternatives

WinBook HP Compaq Dell IBM Toshiba

Price 5 3 3 4 2 1

Weight 3 4 5 4 3 4

Processor 5 5 5 2 5 5

Battery life 1 3 1 3 1 5

After-sale

support

3 3 4 3 5 3

Displayquality 3 3 3 5 3 3

E l i f Si N b k


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Evaluation of Six NotebookComputers

Using a Compensatory ModelEvaluative

Criteria

Importance

ScoreAlternatives


Price 30 5 3 3 4 2 1

Weight 25 3 4 5 4 3 4Processor 10 5 5 5 2 5 5

Battery life 05 1 3 1 3 1 5

After-saleSupport 10 3 3 4 3 5 3

Display

Quality

20 3 3 3 5 3 3

Total 100 370 345 370 385 300 295


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With Noncompensatory Models a

strength on one attribute cannot offset

a weakness on another attribute


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Evaluative

Criteria

Minimum

Standards

Alternatives


Price 3 5 3 3 4 2 1

Weight 4 3 4 5 4 3 4

Processor 3 5 5 5 2 5 5

Battery life 1 1 3 1 3 1 5After-sale

Support

2 3 3 4 3 5 3

DisplayQuality

3 3 3 3 5 3 3

Evaluation of Notebook Computers

Using the Conjunctive Model


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Using the Disjunctive ModelEvaluative

Criteria

Minimum

Standards

Alternatives


Price 5 5 3 3 4 2 1

Weight 5 3 4 5 4 3 4

Processor Not critical 5 5 5 2 5 5

Battery life Not critical 1 3 1 3 1 5

After-sale

Support

Not critical 3 3 4 3 5 3

Display

Quality

5 3 3 3 5 3 3


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Using the Lexicographic ModelEvaluative

Criteria

Rank Alternatives


Price 1 5 3 3 4 2 1

Weight 2 3 4 5 4 3 4

Processor 4 5 5 5 2 5 5

Battery life 6 1 3 1 3 1 5

After-sale

Support

5 3 3 4 3 5 3

DisplayQuality

3 3 3 3 5 3 3


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Decision Outcomes

Choice Model Brand ChoiceCompensatory Dell

Conjunctive HP, Compaq

Disjunctive Dell, Compaq,

WinBookEBA Dell

Lexicographic WinBook


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DecisionRule MentalStatement

Compensatory

Rule I

selected the

computer

that

came

outbestwhenIbalancedthegoodratingsagainstthebadratings

ConjunctiveRule I

selected

the

computer

that

had

nobadfeatures.

Disjunctive Rule I pickedthecomputerthatexcelled

inat

least

one

attribute

LexicographicRule Ilookedatthefeaturethatwasmost importanttomeandchose

thecomputer

that

ranked

highest

onthatattributes.


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An individuals familys decisions to be

committed to a particular lifestyle. For Example: Devoted follower of a particular

religion.


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Consumer decision process can also be

influenced by Incomplete information andNon Comparable alternatives.

There are strategies to cope up with missinginformation:

Consumer may delay decision

Consumer may ignore missing information and

decide to continue with current decision

Consumer may construct the missing information


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Threetypesofpurchases:

Firsttimeortrialpurchase(Ex.:Detregent)

Repeatpurchase

Longterm

commitment

purchases

Incaseofdurablegoodslikerefrigerators,

Washingmachines,Ovens,etc.consumerdirectlymovetolongtermcommitment


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When buying the product/service, the consumer may make choices

From whom to buy: determined by sellers terms of sales, past

purchase experience, return policy, etc store choice: deciding to purchase from a particular outlet

nonstore choice: deciding to purchase from a catalog, theInternet,

or variety of mailorder possibilities

When to buy: determined by whether product is on sale,manufacturer offers a coupon/rebate, stores atmosphere,

salesperson persuasiveness, etc.

Purchase decision can also be influenced by

Attitudes of others (e.g. friends, other customers) Unexpected situational factors (e.g. no cash or credit card for

payment)


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Choice

identification

Purchase

intent

Purchase

implementation

Purchasedecision


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Future responseExitVoice

Loyalty

Decision confirmation

Experience evaluation

Satisfaction/dissatisfaction

Postpurchaseevaluation


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Neutral feeling: Actual performance

matches expectation. Positive Disconfirmation of Expectation:

Performance of product exceeds expectation. Negative Disconfirmation of Expectation:

Performance of product falls below

expectation.


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Consumer may adopt the one of the

following strategy in order to reduce theircognitive dissonance:

Rationalize that decision is wise Look out for advertisement to support their

choice an avoid competitive brand.

Persuade friends or neighbors to buy samebrand and confirm their own choice. Turn to other satisfied owners for their

reassurance.


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RoleofExpectationsinSatisfaction/Dissatisfaction

ActualPerformance

Pre-purchaseExpectations

ActualPerformance

Pre-purchaseExpectations

Dissatisfaction Satisfaction

Postpurchaseevaluation


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If the product performs as per consumer

expectation than the consumer buy it again. If product performance is disappointing of

below expectation than consumers will lookout for alternative products or brand in

future.

27758691 Consumer Decision Making

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