CHAPTER 3The consumer decision process

The consumer decision processHow do consumers make purchase decisions?

How do firms use this information to develop new products and marketing programs?

The CDP represents a road map of consumers minds that marketers and managers can use to help guide product mix, communications, and sales strategies

The consumer decision processP&G used consumer information regarding various decision process stages to create and market Dryel

Consumer decision process modelPurchaseNeed recognitionSearch for informationConsumptionPost-consumption evaluationDivestmentPre-purchase evaluation of alternatives

Need recognitionAn individual senses a difference between what he or she perceives to be the ideal versus the actual state of affairsConsumers recognise needs and seek to fulfill them, or seek a product to solve their problemsKnowing consumers needs helps firms develop products and marketing programs to reach them more effectively

Need recognitionIndividual differences- Consumer resources- Motivation- Knowledge- Attitudes- Personality, values and lifestyleEnvironmental Influences- Culture- Social class- Personal influence- Family - SituationMEMORYNeed recognition

SearchInternal search MEMORYIndividual differencesEnviron- mental influencesNeed recognitionAttentionComprehensionAcceptanceRetentionExposureStimuliConsumer decision process model

Search for informationInternal search: retrieving knowledge from memory or genetic tendencies

External search: collecting information from peers, family, and the marketplace

Search may be passive as consumers become more receptive to information around them, or active if they engage in search behaviour Search refers to a receptivity of information that solves problems or needs rather than a search for specific products

Search: Sources of information Marketer dominated- Advertising- Salespeople- Infomercials- Websites- Point-of-sales materials

Non-marketer dominated stimuli- Friends- Family - Opinion leaders- Media

Information processingM EMORYAttentionComprehensionAcceptanceRetentionExposureStimuli:- Marketer dominated- Non-marketer dominatedAs a consumer is exposed to information from external search, they begin to process the stimuli

Pre-purchase evaluation of alternativesSearchInternal search MEMORYIndividual differencesEnviron- mental influencesNeed recognitionAttentionComprehensionAcceptanceRetentionExposureStimuliConsumer decision process model

Pre-purchase evaluation of alternativesThe process of evaluating alternatives identified from search, which leads to a product or brand selection most likely to satisfy the consumerCan use new or preexisting evaluations stored in memory Evaluative criteria: standards and specifications used to compare different products and brands Alternative can be considered on attributes that are salient or determinant

Pre-purchase evaluation of alternativesSalient attributes such as price and reliability are important to the consumer

Determinant attributes such as a cars style and finish usually determine which brand or store consumers choose

Pre-purchase evaluation of alternativesSearchInternal search MEMORYIndividual differencesEnviron- mental influencesNeed recognitionAttentionComprehensionAcceptanceRetentionExposureStimuliPurchaseConsumer decision process model

Purchase Acquisition of the product that involves choosing a specific retailer, and in-store choices

Purchase intention can change during the purchase stage it can be influenced by factors such as in-store promotions, discounts, salespeople, failure to find the product, or lack of financial resources

Pre-purchase evaluation of alternativesSearchInternal search MEMORYIndividual differencesEnviron- mental influencesNeed recognitionAttentionComprehensionAcceptanceRetentionExposureStimuliPurchaseConsumptionConsumer decision process model

Consumption The process of using the product or service purchased

Consumption can either occur immediately or be delayed

How consumers use a product affects satisfaction with product

How carefully consumers use or maintain a product also determines how long it will last before another purchase is needed

An emotional appeal in product consumption

Pre-purchase evaluation of alternativesSearchInternal search MEMORYIndividual differencesEnviron- mental influencesNeed recognitionAttentionComprehensionAcceptanceRetentionExposureStimuliPurchaseConsumptionPost-consumption evaluationExternal searchSatisfactionDissatisfactionConsumer decision process model

Post-consumption evaluation Consumption is an important determinant of satisfaction

Satisfaction: when consumers expectations are matched by perceived performance

Dissatisfaction: when experiences and performance fall short of expectations

Cognitive dissonance: questioning the purchase decision (post-purchase regret)

Usually, the higher the price, the higher the level of cognitive dissonance

Emotion strongly affects the evaluation of a product or transaction

Pre-purchase Evaluation of AlternativesSearchInternal Search MEMORYIndividual DifferencesEnviron- mental InfluencesNeed RecognitionAttentionComprehensionAcceptanceRetentionExposureStimuliPurchaseConsumptionPost-consumption EvaluationExternal SearchSatisfactionDissatisfactionDivestmentConsumer decision process model

Divestment How consumers dispose of the packaging or product after use

Options include: Disposal Remarketing or reselling Recycling

Variables shaping the decision processIdentify relationships and variables that affect consumer decision making

Identify topics for additional research

Develop and implement marketing mix strategies

Variables shaping the decision processIndividual differences: Demographics, psychographics, values, and personality Consumer resources Motivation Knowledge Attitudes

Culture Social class Family Personal influence Situation behavioursEnvironmental differences:

Variables Shaping the Decision ProcessPsychological processes influencing consumer behaviour Information processing Learning Attitude and behavior change

Consumer decision process continuumMidrange Problem SolvingLimited Problem Solving (LPS)Extended Problem Solving (EPS)HighLowDegree of complexity

Consumer decision process continuum: Repeat purchasesMidrange Problem SolvingHabitual Problem SolvingExtended Problem SolvingHighLowDegree of complexityLimited Problem Solving

Types of decision processesInitial purchase

Extended Problem Solving (EPS): Problem solving of a higher degree of complexity that influences consumers actions

Often occurs with expensive items or can be fueled by doubts and fears

Importance in making the right choice

All seven consumer decision making stages are often activated

Dissatisfaction is often vocal

Types of decision processesInitial purchase

Limited Problem Solving (LPS): Problem solving of a lower degree of complexity that influences consumers actions

Consumers dont have motivation, time, or resources to engage in EPS

Little search and evaluation before purchase

Need recognition leads to buying action; extensive search and evaluation often avoided as the purchase is not of great importance

Types of decision processesInitial purchase

Midrange Problem Solving:

Many decisions occur along the middle of the continuum

Decisions are made with a minimal amount of time and only moderate deliberation

Repeated Problem Solving

Habitual Decision MakingRepeat purchases Unplanned, spur-of-the-moment action triggered by product display or point of sale promotion

Least complex form of LPS but differs in some important waysImpulse Buying

Types of decision processes Consumers may be satisfied with the present brand but still engage in brand switching

Can be triggered because bored with current brand or because of special offerVariety seeking

Factors influencing problem solving extentDegree of involvement: Level of perceived personal importance and interest evoked by a stimulus in a specific situation (High-Low)

Personal factors (self-image, health, beauty, or physical condition)

Product factors (is there perceived risk in purchasing and using a particular brand or product?)

Situational factors (is the product purchased for personal use or as a gift?)

Factors influencing problem solving extentDegree of Involvement (High-Low)

Perceptions of differences among alternatives

Time availability How much time is available to devote to solving the problem?How quickly does the decision need to be made?

Consumers mood state How people feel at a particular moment Mood can reduce or increase length and complexity of decision process