Philipp HackerIM 2nd Year

Consumer Decision Making

Source: Kotler, P. & Armstrong, G., Principles of Marketing, 13e., 2010, New Jersey, Pearson

Buyer decision processes models

Economic models largely quantitative based on assumptions of rationality

Psychological models concentrate on psychological and cognitive

processes qualitative rather than quantitative build on sociological factors (cultural and family

influences)

Consumer behavior models practical models used by marketers blend of both, economic and psychological models.

Types of Buying Decisions

Consumer Decision-Making Process

5-step process

Example: Phone

Consumer behavior model

Need Recognition

= imbalance between actual and desired states

External Stimulus Internal Stimulus

External Stimulus Internal Stimulus

NEED vs. WANT

Needs = status of deprivationMaslow’s pyramid

Wants = needs influenced by culture or individual personalityPhilipp needs food but wants to eat a Schnitzel (not

GoyDeep)

When human wants are encouraged by buying power, wants become demands.

Extra note: Sometimes are needs also divided into Functional and Psychological. Functional: focusing on the performance of a product or service (Example: 400฿ Phone)Psychological: focusing to the personal satisfaction (Example: Iphone)

Mama, Papa yak

gin kanom

WAAAAW

What humans need: Maslow’s pyramid

Image copied from: oaks.nvg.org

Information Search

There are two ways available to search for information:

Internal information search

External information search

Evaluation of Alternatives Determinant attributes = product/service features that are important to

buyer and other choices are perceived to differ Attribute sets = sets of alternative choices Universal sets = all possible choices for the product category Retrieval sets = brands/stores can be readily brought forth from

memory Evoked sets = alternative brands/stores consumers states

he/she would consider when making purchase decision

Consumer decision rules = set of criteria consumers use to quickly & efficiently select from among alternatives

Compensatory = good characteristics compensate for bad characteristics when consumer evaluating alternatives (based on overall features of concerns)

Noncompensatory = consumers choose product/service on basis of subset of its characteristics, regardless of values of other attributes (based on specific feature of concern)

Decision heuristics = consumers choose based on their self preferences e.g. price, brand, or product presentation

Purchase Decision The consumer buys a product/service that he

believes provide them with the best value

Post purchase Evaluation

The negative outcomes can result in no repeated purchase or recommend product to others and more serious can be negative word of mouth and rumors.

Positive outcomes can provide a repurchase and a recommendation of our product to other consumers.

SummaryConsumer Decision-Making

Process

Factors Influencing the Consumer Decision Process

Psychological Factors Motive (drive): a need or want that strong

enough to cause the person seek satisfaction

Attitude: a person’s consistently favorable or unfavorable evaluations, feelings, and tendencies toward an object or idea

Perception: the process by which we select, organize, and interpret info. to form a meaningful picture of the world.

Learning: changes in an individual’s behavior arising from experience

Social Factors

Family: family-members needs/wants

Reference Groups: one or more persons whom individual uses as a basis for comparison

Opinion leader = person within ref. group who exerts social influence

Culture: the shared meanings, beliefs and values of group of people influence consumer behavior

Subculture = a group of people with shared value systems based on common life experiences and situations

Social Class: relatively permanent and ordered divisions in a society whose members share similar values, interests, and behaviors.

Situational Factors

Purchase situation: the purpose of purchase (for what, whom)

Shopping situation: store atmosphere, salespeople, crowding, in-store demonstration, promotions, packaging

Temporal state: state of mind at any particular time or mood swing

Personal Factors

Occupation

Economic situation

Lifestyle

Personality & self conceptAge & life-cycle stage

Video:

This video goes a little bit further and focuses more on the influence of a marketer. But it shows greatly why a consumer decide to buy a product