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Consumer Decision-Making Process: Stages and Implications

   

Added on  2019-10-18

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Topic’s readingIf you have not already read Solomon et al. (4th, 5th, or 6th edition) chapters 3, 8, and 9, please do so after today’slecture.2Plan and learningobjectivesDiscuss consumer decision makingprocess3The Contemporary Consumer1

CONSUMER DECISION-MAKING(Chapters 9 and 3 from Solomon et al 4th and 5th and 6th editions)4Consumer Decision-Making(1)Consumer decision-making is a central part of consumer behaviour, but the way we evaluate and choose products varies widely (along with the amount of thought we put into these choices), depending on such dimensions as the degree of involvement (see topic 2), novelty, or risk related to thedecision.We make many decisions about consumption in our everyday life. Some of these decisions are very important and entail great effort (e.g. which college course to study), whereaswemakeothersonavirtuallyautomaticbasis(e.g. which chewing gum tobuy)5Consumer Decision-Making(2)The decision-making process is further complicatedbecauseofthesheernumberof decisionsweneedtomakeinamarketplace environment characterized by consumer hyperchoice.Hyperchoice is a condition where the large number of available options forces us to make repeated choices that may drain psychological energy while decreasing our ability to make smartdecisions.6

Types of consumer problem solving/decision makingExtended problem-solvingLimited problem-solvingHabitualdecision-making(orroutine responsebehaviour)9Stages in the buyer decision- making processA decision is actually composed of a series of stages that results in the selection of one product over another. These stagesare:Problemrecognition–whenwerealizewemusttakesomeaction (we have a need/want).Information search – consumers survey their environment for appropriatedatatomakeareasonabledecision.Evaluationofalternatives–wherethealternativeproductattributes are considered.Product choice – choosing a product because it appeals in someway.Outcomes–doestheproductsatisfytheconsumer’sneedsand wants?78

10Extended problem solvingManifests in:Extensive thought about the marketplace offering (product/service)Consumer tries to collect as much information as possible bothFrom memory (internalsearch)From outside sources (externalsearch)Takes place when:More expensive products (e.g. car/house)Infrequent purchasing (e.g. college course)High consumer involvement (e.g. wedding planning)Unfamiliar product class and brands (e.g. pensions)Important product purchase/consumption (e.g. car to travel to work)Often initiated by a motive that is fairly central to self-concept (e.g. where to live/buy ahouse)The final decision is perceived to carry a fair degree of risk (e.g. investment)11Limited problem-solvingConsumers are not motivated to evaluateeachalternativerigorouslyInstead, consumers usesimple decision rules orheuristicsThese rules serve as cognitive shortcutsandcutdownontheamount of thoughtrequired12

Habitualdecision-makingDecisions are made with little or no conscious effort. We usually just buy exactly the same product and brand without even considering alternatives (e.g. always buying the exact same milkbrand)Choices are madeautomaticallyRoutinepurchase/consumptionWhen?Lowcostproducts(e.g.food)Familiarclassorproduct(e.g.teabags)Frequent purchasing (e.g.milk)13MORE DETAIL ON THE CONSUMERDECISION-MAKING PROCESS14Stage 1: Problem recognition(1)Occurs whenever a consumer sees a significant difference/gap between our current state of affairs and some desiredoridealstate.Werealizethatto get from here to there we need to solve a problem (large orsmall).15

Problem recognitiondiagramFigure 9.4 Problem recognition: shifts in actual or ideal states17Stage 1: Problem recognition(2)Problem recognition can occur in two ways:(a) The quality of the consumer’s actual state can move downward (needrecognition).E.g. “my car needs to be repaired because the clutch is broken”;lightbulbblows;thinninghair(b)Theconsumer’sidealstatecanmoveupward(opportunity recognition).E.g. new season fashions advertisedlaptop runningslowly;desiring a newer flashy car after a salary increase,Smelling freshcoffeeSeeing someone wearing or using a product that we decide we want (e.g., a newphone)16Marketers’ role in problem/need/want creation(1)Marketers’ role in problemcreation:primary demand, encouraging consumers to use products regardless of the brand they choose.:https://X1QUhttps:// 5rOgAlso see nextslide18

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