Consumer Decision Making Process
Consumer Decision making is a process through which the customer selects the most appropriate product out the several alternatives.
The Consumer decision making process consists of a series of steps that a buyer goes through in order to solve a problem or satisfy a need. They are as follows:
(1) Need/Problem Recognition – A purchase process starts with a need, a problem or a motive within a consumer`s mind. Any internal or external stimulus may drive a customer to believe that he lacks something and motivates him to look for something that will satisfy his need or solve his problem.
(2) Information Search – When a need/problem receives heightened attention from a buyer, he become more receptive about information that may solve his problem and starts gathering data about products/services that will satisfy this need. He uses his personal sources (friends, family, peers etc.) and commercial sources (radio, T.V., newspapers, internet etc.) to look for relevant information.
(3) Evaluation of Alternatives – After collecting information from various sources, the customer evaluates the benefits and disadvantages of various product alternatives and develops a set of choices regarding the product attributes, brand, store etc. that suit his/her needs, taste & preference, personality, lifestyle etc.
(4) Selection and Trial – After keeping a set of choices in mind the customer makes the first product trial. He may buy different products in small quantities (1 kg, 1 packet, 1 bottle) or actually use products individually for some time (tasting food, inspecting phones, taking a test drive) to form an opinion and develop an attitude towards the product.
(5) Purchase Decision – When the customer believes that a product or service offers the best solution to his need or problem, he makes the actual purchase. This includes making a product choice, choosing a brand, a dealer and deciding the amount and time of purchase.
(5) Post Purchase Dissonance/Behaviour – A person seeks reassurance after making a purchase. A purchase generally has the following three outcomes:
- Actual Performance is equal to expected performance – Customer`s behaviour is natural as the product performed according to his expectations. This leads to repeat purchases.
- Actual Performance is less than expected performance – The customer is dissatisfied as the product did not meet his expectations and hence he rejects the product.
- Actual Performance is more than expected performance – This leads to customer delight/satisfaction as the product performance is better than his expectations. This leads to customer loyalty.
Levels of Consumer Decision Making
Extensive Problem Solving – Consumers are highly involved in the product and critically evaluate the product on the basis of established product criteria that will fulfill his/her need.
Limited Problem Solving – Consumer conducts a general search for a product that will satisfy his/her basic product criteria from a selected group of brands.
Routine Response Behaviour – The consumer has very low involvement in the product and he selects any product or brand that fulfills the basic need.
Models/ Four Views of Consumer Decision Making
(A) Economic View or Model – This model assumes that a consumer is rational person and he takes rational decisions. He compares various products, evaluates its benefits and disadvantages, and then makes a purchase decision on the basis of information collected. He is aware of all product alternatives and is capable of ranking products in terms of benefits and disadvantages. However this model is considered unrealistic as people are limited by skills, habits, existing values and perceptions and they are not always rational when making a purchase decision.
(B) Passive View or Model – This model assumes that the consumers take decisions according to the promotional efforts of the marketers and respond directly to the sales and advertisement appeals offered by the marketers. It is opposite to the economic model, as it assumes people will evaluate a product depending upon how it is promoted and positioned in the market. However this model is also unrealistic as the consumers are capable of collecting and evaluating information about product alternatives and then making a purchase.
(C) Cognitive View or Model – The cognitive view is the best of the four models of consumer decision making. This model states that the consumers make decisions on the basis of their own interests and understanding of the market demand and not according to their rational needs or promotional efforts of the marketers. Every marketer must help consumers to develop a short-cut decision rules that shorten the decision making process and lead to instant purchases.
(D) Emotional View or Model – The Emotional model states that all consumers are emotional and act upon their emotions while making a purchase decision. Consumers make more impulsive purchases when they relate themselves with a product or service. They take less time to think whether the product is necessary for them or not, but develops negative or positive emotions related with the product. Hence products that bring negative emotions are avoided and products that bring positive emotions in a consumer are bought by him.
Consumer Decision Rules
(1) Compensatory Decision Rule – In such a decision rule the consumer evaluates each brand in terms of each relevant attribute and then selects the brand with the highest score.
Result: Consumer selects a product after carefully evaluating all product attributes and balancing the pros and cons of each attribute.
(2) Non-compensatory Decision Rule – According to this decision rule, a positive evaluation of a brand or product attribute does not compensate for negative evaluation of the same brand or product on some other attribute i.e. a positive attribute of the product does not make the consumer overlook the negative attributes of the product.
- Conjunctive Decision Rule – Consumers establish a minimum cut-off point for each product attribute and brands that fall below the cut-off point on any one attribute are not considered.
Result: Consumer selects a product which has no negative attributes or bad features.
- Disjunctive Decision Rule – Consumers establish minimum cut-off points for only those product attributes that are relevant to him.
Result: Consumer selects a product that excels in at least one attribute.
- Lexicographic Rule – Consumers first rank the product attributes in terms of importance and then compares the important attributes.
Result: Consumer selects the product that excels in the attribute that is important to the consumer.
(3) Affect Referral Decision Rule – A type of consumer decision rule in which a consumer makes a product choice on the basis of his previously established experience and rating of the product/brand rather than on specific attributes.
Result: Consumers buy a brand with the highest overall rating.