CONSUMER DECISION MAKING
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By: Vidushi sharma



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Types of Decision Making
1. Routinised response behavior/ Habitual buying behavior
Simple, low cost, frequent purchasing, not much search for information, clear preference for brand.
2. Limited problem solving/ Dissonance reducing buying behavior
New brand in known product class, moderate information search and time in choosing
3. Extensive problem solving/ Complex buying behavior
Unfamiliar product class, criteria not known, need for information search, longer time in decision.

Buying Motives
‘Motive’ can be a strong desire, feeling, an urge from within, a drive, stimulus or emotion which plays a role in consumer decision to purchase a product.

Prof D. J. Duncan: “ those influences or considerations which provide the impulse to buy, induce action or determine choicein purchase of goods”

Input:-
Firms Marketing Efforts
Product
Price
Place
Promotion

2. Socio-Cultural Environment
Family
Social classes
Culture and Sub-culture
Informal sources

Need Recognition:-
Consumer recognizes a need when is faced with a problem.

Two types of problem recognition
Actual state type of problem
Desired state type of problem. Eg JAISALMER cigarette

Situations leading to problem recognition
Marketers understand such situations so that they can remind the customers of such situations. Eg: Domino’s, Cadbury
Depleted or Inadequate stock of goods
Discontentment with existing stock of goods
Changing financial circumstances
Marketing Efforts: try to create a gap between actual and desired state

Marketing Implications:
Marketer can segment customers on the basis of their motives. Eg TVS jive
Marketer can devise promotional campaign according to uniqueness of segment. Eg Dabur
Marketers can provide the consumer with the opportunity to recognize their need for particular goods and service. Eg ‘Diamonds are ideal gift’
Identify situations in which consumers are likely to make purchases. De Beers- Wedding collection, cadbury, Kurkure
Marketers can manage marketing mix elements well to take advantage of recognized problem situation. Eg Maruti Suzuki


Information Search:
Once the need or problem is identified customer starts seeking information.
Various sources of information are:
Own personal experience
Reading about product in mass media
A lecture on the product
Word of mouth
Shop window display
Friends and relatives

Type of Information sought by potential buyer
Evaluation Criteria: features to meet needs, price, wash capacity, power consumption, heater facility, drying facility
Appropriate alternatives : various brands available to satisfy the criteria
Alternative characteristics: gather information on each brand on each pertinent evaluative criteria.

The information search
An internal search involves the scanning of one's memory to recall previous experiences or knowledge concerning solutions to the problem-- often sufficient for frequently purchased products.
An external search may be necessary when past experience or knowledge is insufficient, the risk of making a wrong purchase decision is high, and/or the cost of gathering information is low.
External Search:
Information in memory is missing, inadequate, or is suspect, then an external search is required.
Amount of external search activity depends upon:
a. Perceived value vs perceived cost:
Financial cost
Time cost
Physical cost
Psychological cost
b. Individual factors:
Experience with a product
Open mindedness and self confidence of consumer
Educational level income status
Degree of involvement

c. Situational Factors:
Urgency of need and availability of time
Special opportunities arise to purchase at an attractive prices.
d. Risk Factor:
Functional/ Performance risk
Financial risk
Psychological risk
Social risk
Physiological risk
e. Types of product sought:

Shopping goods
Convenience goods

Marketing Implications :
Marketer can make the task easy for customer like finding the information, understanding it and using it.
Marketer can minimize both risks and costs to the consumer in making product selection.

Evaluation of Alternatives
Evaluation criteria are the various features that a customer looks for in a response to a particular type of problem.
Tangible criteria: price, color, size, shape etc
Intangible criteria: brand image, feeling associated with ownership
Evaluation criteria differ in number, type and importance.
It varies with customer, product, situation.
Eg purchasing a pair of jeans
Number of evaluation criteria depends on importance of purchase

Non compensatory decision rules
The weakness of a possible alternative not offset by its strength.
All the criteria should be satisfactory for purchase.
Compensatory decision rules
Trade off while comparing alternatives
Weighted rating is used.

Non Compensatory Decision Rules :-
a) Disjunctive Rule:
Deciding first the most imp criteria for evaluation
Establishing a minimum score for it
Brand should meet this minimum score in it.
That brand will be selected which exceeds other by greater amount.

c) Lexicography Rule :-
This is extension of disjunctive rule
It allows additional evaluative criteria to be incorporated in decision.
Evaluative criteria are added in hierarchical order

d)Sequential Elimination Rule:-
Consumer establishes acceptable performance for each evaluative criteria.
Then each brand is evaluated and evaluation of brand not performing up to minimum criteria
No specific ordering of attributes.

Compensatory Decision Rule :-
Simple Additive Rule
Weighted Additive Rule

Marketing Implications
Evaluation is comparative: ensure own brands are rated superior

Educate the customers on criteria that should be used for evaluation.

Post purchase evaluation
Experiences are judged against expectations
Neutral feelings
Satisfaction : Positive disconfirmation of expectations
Dissatisfaction : negative disconfirmation of expectations

think of an important purchasing decision you have made
what are some of the thoughts you have had following your purchase? Any regrets?
what has influenced those thoughts?
how have you dealt with the discomfort?

Cognitive Dissonance
psychological discomfort caused by inconsistencies among a person’s beliefs, attitudes, and actions
varies in intensity based on importance of issue and degree of inconsistency
induces a “drive state” to avoid or reduce dissonance by changing beliefs, attitudes, or behaviors and thereby restore consistency

Strategies to reduce dissonance
Rationalize the decision to be wise
Look for advertisements to support their choice
Persuade others to buy the same brand
Meeting satisfied owners for reassurance







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