Compare and contrast social, cultural and family influences on consumer behavior.

Or
„Consumer behaviour as a field of study examines external influences on consumption
decisions‟. Discuss. *

Explain – “The evaluation of

purchase decision is based on various criteria” *

Consumers are seen as rational decision-makers. So, they take a

decision when the need arises. There may be different kind of
needs; these needs can be functional or psychological.
Functional needs are directly related to the functionality of a
product and these functions are the features and benefits which
differentiate one product from the other.
Consumer decision is an equally important area. It is also a
difficult activity because a decision always means a surrender,
giving up of something, either money or personal opportunity as a
result of choice of one course of action. It also involves cost, thus
making the process even more complex.

Consumers make many buying decisions everyday. Most large

firm’s research consumer buying decisions in great detail to
answer questions about what consumer’s buy, where they buy,
how much they buy it for, when they buy and why they buy.
Marketers can study consumer purchases to find answers to
questions about what, where and how much.
There are different stages consumer pass through to reach a
buying decision making. Consumer decision making process
represents a problem-solving approach and involves the following
five stages – need recognition, information search, evaluation of
alternatives, purchase decision and post-purchase behaviour.
The consumer decision making process consists of the
following stages:-
1. Identification of the Need for the Product or Service 2. Problem
Recognition 3. Information Search 4. The Evoked Set 5. Evaluation
of Alternatives 6. Beliefs and Attitudes 7. Purchase Decision 8. Post-
Purchase Behaviour Evaluation.
Different Stages Involved in Consumer Decision
Making Process
Consumer Decision Making Process – Need
Recognition, Information Search, Evaluation of
Alternatives, Purchase Decision and Post Purchase
Behaviour
We create history by the choices we make. Consumer decision is an
equally important area. It is also a difficult activity because a
decision always means a surrender, giving up of something, either
money or personal opportunity as a result of choice of one course of
action. It also involves cost, thus making the process even more
complex.
1. Need Recognition:
The first stage of the consumer decision making process where the
consumer recognises a problem or need. The buyer senses a
difference between his actual state and some desired state.
The need can be triggered by internal stimuli i.e. hunger, thirst etc.
or it can be triggered by external stimuli.
2. Information Search:
The stage of the consumer decision making process where the
consumer is aroused to search for more information. The consumer
may simply have heightened attention or may go into active
information search.
The amount of information search depends on the strength of the
drive, the amount of information started with, the ease of obtaining
more information, the value placed on additional information and
the satisfaction obtained from such search.
Information can be obtained by:
a. Personal sources – Family, friends, neighbours etc.
b. Commercial sources – Advertisements, sales persons, dealers,
displays etc.
c. Published sources – Mass media, consumer rating organisations
etc.
d. Experiential sources – Handling, examining, using the product
etc.
3. Evaluation of Alternatives:
The stage of the consumer decision making where the consumer
uses information to evaluate alternative brands in the choice set.
Concepts that help examine consumer evaluation
processes:
a. Product attributes – Consumer sees each product as a bundle of
product attributes. Every consumer will have different rating for
different attributes and will attach different degree of importance to
them.

b. Brand beliefs – The set of beliefs consumers hold about a

particular brand based on the attributes.
c. Total product satisfaction – Consumer’s expectation of total
product satisfaction will vary with levels of different attributes.
d. Evaluation procedure – The consumer arrives at attitudes
towards the different brands through some evaluation procedure.
4. Purchase Decision:
The stage of consumer decision making process in which the
consumer actually buys the product. Generally the consumer’s
purchase decision will be to buy the most preferred brand but two
factors can come between the purchase intention and the purchase
decision

First factor is the attitude of others towards that particular product

and purchase decision.
Second factor is the unexpected situational factors
5. Post Purchase Behaviour:
The stage of the consumer decision making process in which
consumers take further action after purchase, based on their
satisfaction or dissatisfaction.
Satisfaction depends on the consumer’s expectation and the
product’s perceived performance.

Almost all major purchases result in cognitive dissonance or

discomfort caused by post purchase conflict.
Consumer Decision Making Process – Stages that a
Consumer Generally Goes Through while Making a
Purchase Decision Making
Customer are those people in a market who are already buying the
firms market offering. On contrary consumer are all people who
directly or indirectly have interest in market offering but they may
or may not have purchased it. Consumer is not necessarily a buyer
of the product, he may simply be its evaluator, user or disposer or
play any other role with respect to the product.
Following are the stages that a consumer generally goes
through while making a purchase decision making:
Stage # 1. Problem Identification/Recognition:
Consumer purchase decision making processes are triggered by
unsatisfied needs or wants. Individuals perceive differences
between ideal and actual states based on some physical or socio-
psychological dimension.
This motivates them to seek products or services which can bring
their current state into more balance with the ideal. It is impossible
for us to satisfy all our needs at once because we are limited by time
and financial resources. The size of the gap between our desired and
current state largely determines the strength of a particular need.
Sources of Problem Recognition:
(a) Out of Stock – This is one of the most simplest and most
common sources of problem recognition which occurs when
consumer are looking for product and that produce is unavailable.
This can be solved by choosing a familiar brand of different
company.
(b) Dissatisfaction – This is also one of the sources of problem
recognition, which is related by the consumer’s dissatisfaction with
the product/services being issued.
(c) New Needs/Wants – Changes in consumers life often result in
new needs which triggers problem recognition changes in consumer
lives can be due to change in financial situation, change in
employment status, changes in life style or change from graduate
level of postgraduate level etc.
(d) Related Products Purchases – Purchase of a product can also
stimulate problem recognition. Like when consumer purchase a
new home then they look for purchase of related products like
Furniture, Almirahs, Televisions or Refrigerators, which leads to
problem recognition.
(e) Marketers Action – Action of marketer where it encourages
consumers for not to be satisfied with their current state or
situation cause problem recognition. Marketers also take advantage
of consumer’s tendency towards novelty seeking behavior which
leads them to try new or different Brands. Consumer often tries new
products even though they are basically satisfied with their regular
brand.
Stage # 2. Information Search:
The second step in the consumer decision making process is
information search. Once consumer has a problem or need he
knows it can be satisfied by the purchase of a product/service then
they begin to search for information needed to make a purchase
decision. The searches can be – Internal Search and External
Search.
Internal Search is related with initial search effort which often
consists of an attempt to scan information stored in memory, this
means to recall past experiences and knowledge regarding various
purchase alternatives. If the internal search does not yield enough
information then consumer will seek additional information by
engaging in external search.
In external search consumer are moving away from their mind for
acquiring information.
External sources of information can be:
(a) Personal Sources like information from friends, relatives or co-
workers.
(b) Commercial / Marketer Controlled Sources like information
from advertising, point of purchase displays and material or sales
persons.
(c) Public sources like information from articles in newspapers or
magazines, reports or televisions.
Stage # 3. Evaluation of Alternatives:
After acquiring information during the information search stage,
the consumer moves to alternative evaluation. In this stage the
consumer compares the various brands/products and services,
which are identified as capable of solving the consumption problem
and satisfying the needs or motives that initiate the purchase
process.
There is formation of consumer’s arousal for purchase comprising
of evoked set, which consists of the various brands identified as
purchase option. The evoked set is a sub-set of all the brands of
which the consumer is aware. The consumer reduces the numbers
of brands to be viewed during this stage.
The exact size of evoked set varies from one consumer to another
and depends on factors such as importance of purchase and amount
of time and energy the consumer want to devote to comparing
alternatives.
Stage # 4. Purchase Decision:
At this point, the consumer stops searching of information and
evaluation of alternative but makes a purchase decision. Here
consumer develops purchase intentions, which leads to buy a
certain brand. Purchase intentions are generally brand matching
purchase motives with attributes or characteristics as desired by
buyer. This formation involves many of the personal sub-processes
like motivation, perception and attitude formation.
A purchase decision is not always the same as actual purchase. Once
a choice is made as to which brand to buy, the consumer waits for
making the actual purchase. Here additional decisions are made
such as when to buy, where to buy and how money to spend. So
there is usually time delay.
Stage # 5. Post Purchase Evaluation:
Whether a particular consumer feels adequately rewarded following
of purchase depends on two things – (i) the person’s aspiration or
expectation level – how well the product was expected to perform
and (ii) the consumer’s evaluation of how well the product actually
performs.
Consumer’s expectations about a product’s performance are
influenced by several factors. These include the strength and
important of each person’s need and the information collected
during the decisions- making process.

Consumer Decision Making Process – 5 Stages of

Consumer Decision Making in Retail Market
Consumers are seen as rational decision-makers. So, they take a
decision when the need arises. There may be different kind of
needs; these needs can be functional or psychological. Functional
needs are directly related to the functionality of a product and these
functions are the features and benefits which differentiate one
product from the other.
Therefore, on the basis of these functions customers make
purchasing decisions. Psychological needs are cognitive needs and
these needs speak in the form of experience of the consumer like
word of mouth or personal opinion about a product and after
evaluating both of these needs the customer makes a purchasing
decision.
P&G used consumer information regarding various decision process
stages to create and market the product Dryel.
Depending upon the product criteria a customer evaluates the most
possible alternatives and then narrows down his or her choices to a
few products. Then he or she may or may not visit some retail
outlets for the exact purchase as he or she can opt for the e-retailing
format too.
It has been observed that in retail this whole consumer
decision making process goes through five stages which
are as follows:
Stage I – Identification of the Need for the Product or
Service:
The stage starts with need identification. The buying process starts
with a need when a consumer feels like he or she is having an
unsatisfied need and therefore he or she starts looking for the
surroundings to get desired level of satisfaction. A consumer
through his or her previous experience knows how well he or she
can satisfy these unmet needs like hunger, thirst and shortage of
clothing.
Need recognition in most cases is straightforward when individuals
find a shortage of something or goods required are of daily use. For
example, there is no wheat/milk in the kitchen. A need may be
aroused by an external stimulus. A stimulus such as a desire to visit
a part of an outlet while purchasing other usual items.
Okay, so why do people want to buy things? It is because there is a
problem, and they are looking for the solution to their problem.
This is where the marketer can do several things to make his or her
product or service more enticing to the consumer. If the problem
persists, your job as a marketer is to present that problem with a
solution. Want an example of great marketing? Just look at how
Steve Jobs came along with the iPhone marketing. No one needed
it, but he made sure that the iPhone was something that everyone
needed to have.
Think of this simple equation here-
Problem = Desired State – Current State
Stage II – Information Search:
This part of the consumers’ decision-making process is where they
are looking for more information. They search for this either
internally or externally. What is the difference between the two?
Internal search is what someone already knows, such as pre-
existing knowledge of the product or from the consumer’s memory.
An external search is as simple as the consumer could use Google to
look for a product review or perhaps even video demonstrations on
YouTube.
The second stage is gathering information on how to solve the
problem and how the consumer looks for the possible options to
resolve the need in consideration. Information search is a process
where the prospective buyers examine their environment for
appropriate information to make a sound decision. This search may
be internal (from memory), or external (through friends, family,
published sources, salespersons, and the internet).
An individual usually drives or acquires information from the
sources namely internal and external. A person’s past experience
accompanied with shopping exposure might provide him or her
with substantial guidelines to make the correct decision with the
help of his or her internal memory. Consumers invest time in
information search in preparation to the perceived risk associated
with the particular purchase and the importance of purchase.
Stage III – Evaluation of Alternatives:
After an information search for the required product is completed, a
consumer is expected to take a final decision on one of the choices
available. The search also helps the consumer to acquire knowledge
about the criterion to be used to evaluate the various alternatives
involved at the information stage.
To justify this point in Gurgaon, some management
students in order to find out the best option enlisted the
following restaurants for consideration:
(a) Haldirams
(b) Nirulas
(c) McDonald’s
(d) Pizza hut
The alternatives are always considered by the consumer while
taking a purchase decision. And this process constitutes an evoked
set. The evoked set signifies all the outlets and product substitution
which the consumer can memorise, remember, and corroborate
with existing need.
What other opportunities does the consumer have with him or her?
Some things that they will analyse include cost and effectiveness.
When you are purchasing a new car, don’t you look into other
options? The consumer can choose a product based on features or
their attitudes. For example – “Oh wow, this new Ford has so many
great features! Hmm… but if I get this BMW, it will make me look
rich and important to all my friends.”
The retailers should make sure that their product should fall under
the consideration set of the customer; otherwise, the product and
the retail outlet will fail. For this purpose they need an effective
marketing programme which can effectively position the product in
such a way that for a particular need that product will automatically
fall in the consideration set of the consumer.
The communication strategy for the same purpose should be very
stronger followed by the promotional strategy. At the same time
retailers need to cope up with the dynamics of the environment and
should change the offerings according to the changing needs. From
the customer point of view, he or she will evaluate all the possible
alternatives available and can shortlist the best possible one (a
restaurant of choice for taking his or her friends out for a treat).
Stage IV – Purchase Decision:
The purchase decision can be considered as a final decision where
an individual tries to focus on the product category or brand
amongst a large pool of alternatives. As suggested in the consumer
buying behaviour Howard Seth model, a consumer goes through a
lot of stimulus display which may be significant, symbolic or social
in nature and chooses a brand out of the various alternatives that
are available.
In such a process, the final purchase decision is based on
the five-step approach:
1. Attention
2. Brand comprehension
3. Attitude building
4. Intention to buy
5. Final purchase
While making decisions regarding a purchase, an exchange of cash
or credit is involved. Today with the environment of large number
of players, the revenue process has gone through a transformation.
A consumer is able to pay for a product after the product reaches to
him or her (cash on delivery). There are some other methods which
have facilitated the process of payment organisation, such as Paytm,
Oxigen wallet, that have improved the overall business for retailers.
Consumer purchasing behaviours have also been strongly affected
with the arrival of online retail players which are using various
methods for attracting the consumers. Various methods such as the
Big Billion Day by Flipkart have changed the entire approach of the
purchasing behaviour. A lot of impulsive nature has got into the
purchase of the product during such events. India is moving slowly
into a consumer-driven society.
Stage V – Post-Purchase Behaviour:
With an increase in retail options, there are a lot of alternatives, The
Indian consumers have become literally kings who have got the
power to reject or accept the marketer. Post-purchase behaviour is
vital from the marketing point of view because a happy consumer
can easily positively affect the lifetime value of a product as he or
she can create positive word of mouth across social media
(Facebook, Twitter, and Linkedin) which can have a productive
effect on other consumers. It helps the company in finding new
customers without much spending. But the effect can also be
negative if the consumer is dissatisfied and hence spreads a
negative word of mouth. Therefore it has become a concern for the
marketers to manage the post-purchase behaviour.
After making a purchase a consumer compares it against the
products available in other retail formats especially with regard to
the price. For example, a mobile phone available on Flipkart or
Amazon is compared against each other and based on that the final
purchase decision is made. In case the consumer has already made
a purchase and he or she finds the products with similar features at
a lesser price in the competitors’ basket then it creates a negative
image in his or her mind.
The kind of evaluation a consumer normally does can be
considered in the following ways:
1. The performance of a product matches with the expectation. This
leads to satisfaction among the consumers.
2. The performance exceeds the level of expectations. It results in a
delightful situation. It automatically leads to the repeat purchase
and positive word of mouth publicity.
3. The performance falls below the expectation which then leads to
dissatisfaction and negative word of mouth.
Performances can be measured not only in terms of product quality
but also much more than that.
It can be measured in the following terms:
1. Time taken to deliver a product
2. The packaging and the condition of the product
3. The price of the product in the different retail formats
4. The brand image of the retailer
5. The offers it gives to the consumer
6. The handling of invoices and the other documents
7. The return policies of the company
8. The satisfaction with the logistics provider attached with the
companies
9. The ambience of the retail format.

Consumer Decision Making Process

Consumers make many buying decisions every day. Most large
firm’s research consumer buying decisions in great detail to answer
questions about what consumer’s buy, where they buy, how much
they buy it for, when they buy and why they buy. Marketers can
study consumer purchases to find answers to questions about what,
where and how much.
We shall now examine the stages consumer pass through to reach a
buying decision making. Consumer decision making process
represents a problem-solving approach and involves the following
five stages – need recognition, information search, evaluation of
alternatives, purchase decision and post-purchase behaviour.
The consumer decision making process starts long before actual
purchase and continues long after. This encourages the marketer to
focus on the entire buying process rather than just the purchase
decision.
1. Need Recognition:
The consumer decision making process starts with need
recognition. A buyer feels a certain need has arisen and has got to
be satisfied. Needs may be triggered by internal stimuli or by some
external stimuli. At this stage the marketer consumer need
recognition. The market should research consumers to find out
what kinds of needs arise, what brought them about and how they
led the consumer to this particular product.
2. Information Search:
An attentive consumer may or may not search for more
information. If the consumer’s drive is strong and a satisfying
product is at hand, the consumer is likely to buy it then. If not, the
consumer may under an information search for the product.
The customer can get information from the following
sources:
(a) Personal sources — family, friends, neighbours
(b) Commercial sources — sales people, ad, dealers
(c) Public sources — mass media
(d) Experiential sources — using the product, examining.
The relative influence of these information sources varies with the
product and the buyer. Once more information is obtained the
consumer’s awareness and knowledge of the available brands
increases. The marketer should carefully identify consumers’
sources of information and importance of each source. This
information is critical in preparing effective communication to
target markets.
3. Evaluation of Alternatives:
The consumer uses information to evaluate the alternative brands.
There are several elements in the process of evaluation.
First, we assume that each consumer is trying to satisfy some need
and is looking for certain benefits which can be acquired by buying
a product or service. Each consumer sees a product as a bundle of
product attributes, for delivering these benefits and satisfying the
need. Such as price, size, picture, etc. Consumers will vary as to
which of these attributes they consider relevant and will pay the
most attention to.
Second, the consumer is likely to develop a set of brand beliefs
about where each brand stands on each attribute. The set of beliefs
about a particular brand is known as the brand image. Brand
images can help in the evaluation of alternatives.
Third, in order to reduce the number of alternatives, some
consumers may consider only more critical attributes and mention
the level of these attributes. In auto purchase, a consumer first
specifies the price range to eliminate many alternatives and then
further eliminate many alternatives like diesel car or petrol car, size,
etc.
Fourth, the consumer may use an evaluation process involving trade
among different alternatives. Marketers should study buyers to find
out how consumers evaluate brand alternatives. If they know the
evaluation process marketers can take steps to influence the buyer’s
decisions.
4. Purchase Decision:
In the evaluation stage, the consumer ranks brands and forms
purchase intentions. Generally, the consumer’s purchase decisions
will be to buy the most preferred brand but two factors — attitudes
of others and unexpected situational factor—can influence the
purchase decision. The first factor is the attitude of others.
For instance, a boy wants to buy a camera but his father wants him
to buy the lowest priced camera, then the chances of the boy
purchasing an expensive camera will be reduced. Purchase
intention is also influenced by unexpected situational factors. The
consumer may form a purchase intention based on expected
income, expected price and expected benefits from the product.
When the consumer is about to act unexpected situations may arise
due to loss of employment or some other purchase may become
more urgent. Thus purchase intentions do not always result in
actual purchase choice.
5. Post-Purchase Behaviour:
The marketer’s job does not end with the purchase of the product.
After purchasing the product, the consumer will be satisfied or
dissatisfied and will engage in post-purchase behaviour. The
product use will provide feedback of information. If the product
falls short of expectations, the consumer is disappointed, if it meets
expectations, the consumer is satisfied; if it exceeds expectation the
consumer is delighted.
Consumers base their expectations on information they received
from sellers or other information sources. If the seller exaggerates
the product’s performance, consumer expectations will not be met
— this situation will lead to dissatisfaction. The larger the gap
between expectations and performance, the greater is the
consumer’s dissatisfaction. This fact suggests that seller should
faithfully state the product’s performance.
Some sellers also understate performance levels to boost consumer
satisfaction with the product. For example, Boeing sells expensive
aircraft and consumer satisfaction is important for repeat purchases
and the company’s reputation.
Almost all major purchases result in cognitive dissonance or
discomfort caused by post-purchase conflict. Consumers are
satisfied with the benefits of the purchased brand and glad to avoid
the drawbacks of the brands not purchased. On the other hand,
every purchase involves compromise.
Consumers feel uneasy about acquiring the drawback of the
purchased brand and about losing the benefits of the brands not
purchased. Thus consumers feel at least some post-purchase
dissonance for every purchase.
It is important to satisfy the customer because a company’s sales
come from two basic groups —new customers and repeat customers.
It usually costs more to attract new customers than to retain current
ones. The best way to retain current customers is to make them
happy. A satisfied customer buys a product again, talks favourably
to others about the product and buys other products of the
company. Many marketers go beyond merely meeting the
expectations of customers — they aim to delight the customers.
An unhappy consumer responds in a different way. Whereas a
satisfied customer, on an average, tells 3 people about a good
product experience, a dissatisfied customer tells 11 people. Clearly,
bad word of the mouth travels further and faster than good word of
the mouth and can quickly damage consumer attitudes about a
company and its product.
Therefore, it is wise for a company to measure consumer
satisfaction regularly. It cannot rely on dissatisfied customers to
ventilate their grievances when they are dissatisfied. A company
should set up a suggestion system to encourage customers to
complain. In this way the company can learn the drawback of its
product and how to improve it.
Moreover, marketers can take additional steps to reduce consumer
post-purchase dissatisfaction and to help customers feel good about
their purchases. For example, automobile companies can write to
new car owners with congratulations on having selected a fine car.
They can obtain customer suggestions for improvements and tell
the location of available services. Post-purchase communication to
buyers results in fewer returns and order cancellations.

Consumer Decision Making Process – 7 Stages

Involved in the Consumer Decision Making Process
The person who recognises a need effectively becomes a potential
customer. It is the recognition of a need that creates a want. A
person may be thirsty so be in need of a drink, but this may be
expressed as wanting a glass of champagne.
The creation of a want involves a decision process which
can involve some or all of the following seven stages:
Most day-to-day purchases involve little or no risk in terms of being
dissatisfied with the decision, so justify little time or effort. The
choice is made on the basis of the immediately available
information.
1. Complex Buying Behaviour:
For very high-risk purchases buyers are likely to go through each
stage of the decision-making process. This is termed ‘complex
buying behaviour’ and is seldom adopted because of the time and
trouble involved.
An example where this approach might be justified could be the
purchase of a wedding present for someone overseas – in the US
perhaps. Stage one comes with the engagement announcement.
Because it is so far away the need to take extra time and trouble
could well be accepted with little thought, whereas stage three
might involve finding out how long parcel post takes by sea and air
and the relative costs, whether the electrical supply is compatible,
and whether a gift list is being circulated around other friends and
family members.
Possible alternatives might then be chosen on the basis of the
amount of money available for the present. Stage five, the selection,
could be made on the basis of ease of shipment and availability.
Then, after the present has been purchased, stage seven might occur
when it is being packed since if this is difficult the choice made may
well seem less suitable than an alternative which could have been
packed and shipped by the supplier.
2. Information Search:
The third stage of the process – information search – may involve
starting from scratch, such as when the product is entirely new or is
totally unfamiliar to the buyer. Obvious examples might be skis
being purchased by the first-time skier or a hang glider by someone
who has only tried the sport. This is, however, relatively
uncommon.
Most products are by their nature in some way associated with
other products. Thus someone considering buying a new television
is likely to consider the brand of their existing television favourably
if it has been reliable – unfavourably otherwise. Perhaps the brand
of their radio, music centre, CD player or other similar product
would then be at least initially considered.
3. The Evoked Set:
Those brands which initially come to mind when considering a
purchase are referred to as the ‘evoked set’. Clearly any brands
which most people bring to mind in relation to certain types of
product have a distinct advantage compared with other brands. It is
the brands which are regularly within the evoked set of potential
purchasers which set the standard that alternative products have to
better if they are to be selected.
The concept of the evoked set was developed by Howard and Sheth
as a result of their work on the development of a comprehensive
buyer behaviour model.
4. Evaluation of Alternatives:
Stage four (evaluation of alternatives) is another important part of
the process since it will inevitably depend upon making a
comparison of only a few specific potential differences between the
products. These are known as the salient attributes. Other
differences are known as the non-salient attributes.
Examples relevant to the choice of a motor vehicle might be the
availability of fuel injection, a sun roof or electric windows. Other
factors, such as more secure door-locking systems or low-level
access to the boot, have until recently been considered non-salient
attributes by most buyers. This is in spite of these features having
significantly greater potential for saving inconvenience or injury
than any of the attributes usually considered salient.
Studies have shown that there are many different evaluation
procedures which are used when making buying decisions. This
work has also shown that these tend to be complex since they
involve comparing attributes within the context of brand beliefs and
attitudes.
5. Beliefs and Attitudes:
Other factors significant in the context of evaluating alternatives are
the beliefs or attitudes held about the brands. Beliefs are
perceptions of a brand which are based on explicit information.
Attitudes are firmly held ideas which are often neither confirmed
nor explicitly shown to be wrong by available information.
Returning to the personal computer example, users often take the
view that IBM products are expensive. This view could be as a result
of comparing the price of a range of similar machines. It could then
be classed as a belief since it would be a descriptive thought based
on the assessment of available data. Such beliefs may be modified
by new information.
It could, however, just as easily be based on prejudice rather than a
rational assessment of available data. It would then be classed as a
brand attitude. These tend to be enduring evaluations which are
resistant to new information. It is quite likely that brand selection
will also be significantly influenced by the buyer’s understanding of
the brand beliefs and attitudes of others, particularly close family.
6. The Purchase Decision:
Even when a decision to buy a particular product has been made,
the purchase decision can be affected by unanticipated situational
factors such as the cancellation of overtime working or because of
the numerous other decisions often directly associated with the
purchase – the vendor, the quantity, when and how to pay.
The quantity decision can often involve associated items such as
batteries, film for cameras, tape for recording machines, etc., rather
than the main item being purchased. Very often the supplier or the
vendor removes the need to make these decisions by either
including the essentials in the form of a prepackaged kit or by
providing these as a discount on the price. The provision of the
associated items as a kit can be considered a marketing strategy,
whereas if they are provided as a form of discount this would be a
selling strategy.
The timing decision is often linked to the payment decision, and the
acceptance of credit cards has to a large extent reduced the
importance of these decisions for many purchasers.
7. Post-Purchase Behaviour:
The final stage of the complex consumer decision making process is
post-purchase behaviour. Since it is seldom possible to make a fully
rational purchase decision, it is hardly surprising that purchasers
often doubt the wisdom of their choice when, finally, the purchase
has been made. This leads to minor faults being found with the
product itself or its features.
Recognising this, manufacturers have found it beneficial to aim
some of their advertising directly at new owners to reassure them
that they have made a wise decision. This approach is often used by
motor vehicle and copier manufacturers – they have appreciated
how important an influence existing users can be on potential
customers.
The provision of free telephone help-lines, call-out services and ‘no
quibble’ return policies, such as those adopted by Marks & Spencer,
are aimed specifically at overcoming this problem. It was also
within this context that an increasing number of suppliers have
recognised the importance of having good instruction manuals.

Consumer Decision Making Process – Separate

Stages and Sub-Stages Involved in the Process
While purchasing any goods or services, customers actually go
through a complex purchase process. Consumer decision making
has three major stages known as the pre-experience evaluation,
consumer experience and post-evaluation experience.
These separate stages are further divided into sub-stages
as below:
1. Pre-Experience Evaluation- Consumer Choice:
Marketers are usually concerned over the thought how customers
choose a certain product over others and what is their decision-
making process which leads to the final purchase of the product.
Customers go through various stages of this phase like need
recognition, information search, evaluation of alternatives, and
purchase.
Following is the explanation for each of the following
stages:
(A) Need Recognition:
The buying process actually begins with recognising the needs of the
customers. There are various ways of recognising a customer’s
needs. However, Maslow’s hierarchy specifies in the best possible
manner the five need categories which are arranged in a sequential
order right from basic-lower level needs to the higher-level needs.
There are various services which can fulfil all the types of needs and
these become increasingly important for higher-level, self-
actualisation and ego needs.
i. Psychological Needs- They are known as the basic or the survival
needs like food, clothing and shelter.
ii. Safety and Security Needs- This includes shelter, security and
protection from any dangers.
iii. Social Needs- These needs are for friendship, affection and
acceptance amongst others.
iv. Ego Needs- After fulfilling the basic needs, people look for more
satisfaction by fulfilling their ego needs. They would like to get
easily accepted in the society and hence purchase products which
will add to their image and status.
v. Self-actualisation Needs- This involves enriching and self-
fulfilment experiences wherein a customer believes in living their
life to the fullest.
(B) Information Search:
Once the customer recognises his needs, he then tries to gain
information of the same. They start looking for other people’s
feedback and opinions which they can study and decide whether
they can buy the product which they desire or can look for
alternatives. Information may be quick and relatively automatic for
small purchases and may extend to a formalised one in case of
costly and big purchases.
People make use of both personal sources and non-personal sources
for collecting information. Personal sources can be experts and
immediate friends and non-personal sources can be websites,
selective media and mass public. Seeking information actually
invokes confidence in buyers and also reduces the risk of wrong
purchases.
(C) Evaluation of Search Alternatives:
In today’s cut throat competition, there are a lot of options available
in the market to choose from. Customers have a wide variety of
alternatives and they have their own preferences of selecting one
product over the above. Many a times, customers do not want to go
through a daunting process of searching and evaluating the
products hence they usually go in for the first option that is easily
available to them.
If need be, they might look in for other alternatives which are
available locally so that they do not have much trouble evaluating
the alternative search. In order to purchase goods, customers visit
retail stores where they keep various alternatives of the same type of
products. In order to purchase services, customers visit
establishments like banks or salons where they just render one type
of service and do keep other options available. Customers are
heavily depending on the internet for their wide evaluation of
search alternatives.
(D) Service Purchase:
After following the above stages in a sequential manner, customers
finally make the decision of purchasing the goods or services. The
major difference between purchasing goods and purchasing services
is that goods can be felt before buying. For example, people will try
the product personally before buying a similar one for actual
consumption.
This gives them a fair idea of what they will be buying. Whereas in
services, due to its intangible characteristics people may not know
their exact product till they actually pay for it and consume it; or
make part payments to know better.
For example, eating a meal in a restaurant, a person has to consume
the service to know it. In case like vacation planning, customer will
have to make part payments to proceed with the plan and make full
payment before finally leaving for the same.
2. Consumer Experience:
Due to the various choices available in the market and the credence
qualities of goods, it is difficult to make out what decision-making
process does a customer go through. It is actually a customer’s
experience that influences his future purchasing needs and choices.
Experience plays an important role in defining the decision-making
process of the customers.
Experiences are of various types like funny, good, short, exciting,
memorable and less exciting. Depending upon these experiences,
people make their future purchase decisions. Thus organisations
have realised the importance of customer behaviour and making all
efforts to make their experiences happy and memorable.
(A) Services as Processes:
Services are actions also known as performances that are done for
the customers. Service is a process which involves various steps,
activities and actions. For example, in medical services, the first
step is a patient interacts with the physician. The second step is to
follow the doctor’s prescriptions and take the medications.
Other steps may involve third parties like going to a lab for blood
testing etc. Thus, this is known as a series of steps for one work
which actually form an experience to the patient. When a person
interacts with multiple people for one task and when this whole
process takes a long time then it becomes a memory for him related
to that particular task. This memory can be a good one, bad one or
simply remain as an experience!
(B) Service Provision as Drama:
Theatre works and dramas actually aim at giving a desirable
experience through performances. A lot of hard work is put in this
type by carefully managing the actors and physical setting of their
behaviour at the backstage so that they can perform their best on
the stage and leave a lasting impression on the viewer’s mind.
(C) Service Roles and Scripts:
Roles are actually a guiding list which orders a person to behave in a
particular manner. Like stage plays and dramas have roles, even
service delivery includes the same. For example, an air hostess or a
waiter is expected to behave in a certain way which their job
demands for.
It is the work of a hostess in a restaurant to greet the customers
warmly, help and guide them in selecting the food items from the
menu, reserve place for the bookings, see that everyone is
comfortably accommodated and that they are enjoying their dining
experience. Service employees need to behave according to the
customer’s expectations otherwise they get frustrated and
dissatisfied.
(D) The Compatibility of Service Customers:
It is a human tendency of a person to follow others. Thus the crowd
present at a location influences a customer’s expectations
immensely. The way others behave or react about a service affects
other people’s mentality too. Customers can get incompatible due to
many reasons like differences in age, values, beliefs, experiences,
appearance, health and ability to pay.
Companies can concentrate on such incompatible customers and
promote their individual decision-making process. However, they
should also put in efforts to bring together the other lot by fulfilling
their needs as desired.
(E) Customer Coproduction:
In many services, customer participation is equally important.
Without this, there will be no meaning to the customer service being
rendered. For example, in educational institutes, training and
counselling, a customer has to dedicatedly concentrate on the
sessions to bring out the best of the rendered services. Thus,
customer coproduction is equally important to make customer
service successful.
(F) Emotion and Mood:
Emotions and moods are the most important factors that play a
major role in influencing the purchase decision of the customer. It is
a person’s state of while purchasing and consumption that decide
the future decisions.
3. Post-Experience Evaluation:
Once the customer purchases and consumes a product, they form a
post experience evaluation whether they will come back to purchase
the same again or no.
It is only after they have experienced, they evaluate the quality of
the product. Generally a lot of attention is given to the pre-purchase
evaluations and consumer choice. However, post purchase
evaluations are equally important for organisations to understand
and accept. They are typically important to judge the customer’s
subsequent behaviour and repurchase of the product.
Post experience evaluation is basically captured in various measures
of service quality, satisfaction, emotional engagement and loyalty.
Following are the specifics of service quality and customer
satisfaction:
(A) Word-of-Mouth Communication:
This is the most preferred option for many customers. People go by
the word-of-mouth reference for any products or service. Thus, it is
important for organisations to create good experience so that
customers can talk positively and give a good reference to others.
However, if the service is bad then it is very difficult for the
company to curb the negative talking that goes around amongst
people.
(B) Attribution of Dissatisfaction:
When a customer is dissatisfied about a service, he may link the
attributes to various sources. For example, if a customer goes to a
salon for a specific haircut, but is not satisfied by the same then
he/she may link it to many various factors like lack of skill of the
hairstylist or inability to give clear instructions on her part as to
what style she wants. Most of the time, they feel responsible for
dissatisfactory services as they closely participate in almost all the
stages of services.
(C) Positive or Negative Biases:
Research says that it is a human tendency to remember or weigh
negative experiences more than the positive ones. Thus, if there is a
good experience people may not remember for a long time.
However if they have had a bad experience then they will never
forget the same. Similarly, negative rumours are spread and affect
more easily than the positive ones.
(D) Brand Loyalty:
It is the brand loyalty as well on the customer’s part which decides
his future buying decisions. If a customer is completely satisfied
with a particular brand then he will stick to it forever no matter its
price or availability. Companies also make extra efforts to retain
their loyal customers as they know the hard work involved in
making one.

Consumer Decision Making Process – 5

Important Stages Involved in the Consumer Decision
Making Process
The consumer decision making process or the stages
involved in the decision-making process are:
1. Problem recognition,
2. Information search,
3. Evaluation of alternatives,
4. Purchase decision and
5. Post-purchase behaviour.
Stage # 1. Problem Recognition Stage:
This is usually the first stage in the consumer’s decision making
process. During this stage, the consumer recognises a problem and
feels that he has to do something to reduce (or solve) the problem.
This problem recognition can be due to either an actual state of a
consumer or desired state of the consumer.
The actual state of problem may occur when the consumer feels the
product or service is not giving the satisfactory performance. For
instance, the consumer may feel that the music system he
purchased is not giving the desired stereo effect. The desired state
type of problem occurs when say a consumer who already owns a
motor cycle, now desires to purchase a Maruti Alto, due to a rise in
his purchasing power.
He also happens to read about the attractive offers for ‘Alto’
displayed outside the company showroom. This again stimulates in
him a desire to purchase the car. The marketer needs to understand
the circumstances or environmental cues which acts as a trigger to
arouse the needs and desires of consumers and then develop
attractive product displays and communication programmes.
Stage # 2. Information Search:
An aroused consumer may or may not be involved in information
search. If the consumer’s drive is strong and the required product is
easily available (say Pepsi to quench one’s thirst), then he or she
may not seek more information.
But if the consumer’s drive is strong, and yet he is in a
dilemma and seeking answers to questions such as:
i. Which product category or particular brand will best satisfy his or
her need?
ii. Where the product (or brand) will be easily available?
iii. What is the experience of the person(s) who has consumed the
product?
Ultimately, how much information search the person is
engaged in will depend upon:
a. The strength of his or her inner drive.
b. The amount of information originally available and the ability to
obtain additional information.
c. The importance attached to the obtainment of additional
information.
d. The satisfaction the consumer gets from gathering additional
information.
Usually, the extent of search activity will increase as the consumer
moves from a limited problem situation to one involving extensive
problem solving. There are broadly four categories of consumer
information sources – Personal sources, Commercial sources,
Public sources and Experiential. The relative influence of these
information sources will vary according to the product category and
buyers characteristics. Each category of information source will
influence the consumer differently.
Mass communication or information is received via commercial
sources, while, the consumer may verify (or evaluate) this
information through personal sources. So in this case, commercial
sources carry out the informing function and personal sources the
evaluating function.
After going through the information search stage, consumers will be
able to increase his or her awareness of the available brands and
their relevant features, in the particular product (or service)
category. Hence, the marketers are required to do research and
identify those information sources preferred by the target
consumers and work at a suitable marketing mix programme.
Past experience is also considered to be an internal source of
information. Most of the consumer decisions are taken on the basis
of past experience (internal source) the degree of perceived risk and
marketing and non-commercial information (external sources).
Stage # 3. Evaluation of Alternatives:
While making an evaluation of the alternatives,
consumers tend to use two types of information:
(a) A ‘probable list’ of brands from which they plan to make the
selection (the evoked set).
(b) Decide on the criteria to be used for evaluating each brand.
The probable list or evoked set refers to the specific brands, within a
particular product category which a consumer considers while
making the purchase decision. This set could include the small
number of brands the consumer is familiar with, and finds
acceptable. For instance, the evolved set for a DVD player by a
consumer could include — Sony, Philips, Sansui, L.G., Videocon,
Onida. It is to be remembered that the consumer will be considered
only if the product is a part of his or her evoked set brand.
The marketers at this stage, need to work on designing promotional
techniques which will communicate a favourable and relevant
product image to the target consumer. While deciding on the
criteria for evaluating brands, each consumer will have a set of
important product attributes.
This will be used as the basis for evaluating brands. For instance, a
consumer intending to purchase a personal computer may look out
for the following attributes — CPU speed, price, type of display,
Hard disk size, Amount of memory, CD/DVD, Read or Readwrite,
laptop or; desktop.
Another consumer may be planning to purchase a DVD player. The
product attributes he will be seeking in a DVD player will include —
CD format support, PMPO (peak music power output), Megabass,
Random play feature and FM tuning. Of course, the set of attributes
and their relative importance to the consumer will vary from person
to person.
Further, the consumer is also likely to have a predetermined notion
and brand beliefs about where each attribute stands in their rank of
importance to him or her. That is, the consumer will assign
weightage to each brand attribute considered in terms of their order
of importance to him or her. And in this way the consumer is most
likely to identify the product brand of his or her choice.
Marketers need to understand as to how and why consumers
evaluate brands. They must also try to influence buyer’s decision-
making process by designing and promoting products matching the
beliefs and choice of the target market. They should also constantly
try to communicate the prominent features or attributes of the
product or service to increase consumer awareness and interest in
their brand.
Jet Airways has been able to capture customers attention by their
constant communication (via the print media) of the benefits of e-
ticketing and motivate people to experience the joy of flying with Jet
Airways.
The success of ICICI Prudential, where the company was able to sell
the concept of Planning for retirement by customers in the age
group of 30-40 years, chief wage earner in the prime their working
life with high disposable income can be attributed to the multi-
dimensional communication strategy that went beyond traditional
mass media.
ICICI was able to change the consumer’s perceptions towards
retirement planning totally because of its aggressive advertising
campaigns ranging from — Television, Print, Radio, Point of
purchase displays, Out of Home, Public Relation to Consumer
Services
Stage # 4. Purchase Decision:
The above mentioned ‘Evaluation of Alternatives’ stage will help the
consumer to take a decision on his or her purchase intention. To a
certain extent, the consumers purchase decision may be influenced
by the attitude of others or the unanticipated situational factors. By
the attitude of others we mean person(s) who are close to the
consumer and their attitude or response towards the purchase
decision.
We presume that in the purchase of the personal computer decision,
the consumer may decide to purchase Dell’s Laptop Computer.
However, the consumer’s wife may suggest the purchase of a
desktop computer (HP’s) since she feels that a desktop computer
when installed at home can be used by the children also. So in this
case the consumer may either delay the purchase of the laptop
Personal Computer or if convinced, decide to purchase HP’s
desktop computer.
By unanticipated situational factors, we mean unforeseen
circumstances such as additional expenses due to a family member
falling sick or say one is required to go out of station for a long time
on official duty. These situations may result in a delay in the
purchase intention or decision.
Nevertheless, the consumer’s decision to change, postpone or avoid
an immediate purchase decision will be greatly influenced by the
perceived risk factor. This perceived risk concept can be associated
with the transaction money involved and the consumer’s self-
confidence to handle the risk factor. Of course, the consumer will
work out ways to reduce the perceived risk. He will try to gather
more information from reliable sources and seek those brands
which offer long-term warranty period.
The marketer, should try to help the consumer in his decision-
making process by providing all the necessary information, through
various reliable sources and thus reduce the consumers perception
of risk.
Stage # 5. Post-Purchase Behaviour:
There is a general tendency among consumers to judge their
experience against their expectations when being involved in a post
purchase evaluation process. The level of satisfaction experienced
by the consumer after his purchase will depend on the relationship
between the consumer’s expectations and the products or services
perceived performance. If the product or service matches
expectations, the consumer is satisfied, otherwise, not.
For the marketer, it will be of interest to know the post purchase
behaviour, undertaken by the consumer. For, the consumer’s post-
behaviour actions will give the feedback on whether he or she is
satisfied or dissatisfied with the product or service acquired.
There are three possible outcomes after the consumer
purchases the product or service:
i. He is satisfied since the actual performance matches expectations.
ii. The performance of the product surpasses expectations leading to
customer delight.
iii. The performance of the product or service falls below
expectations, leading to dissatisfaction.
In the first two instances, the consumer is very much satisfied with
the product or service performance and is likely to purchase the
same brand of product in the future too. Further, a satisfied
customer will also act as an informal opinion maker or provide a
positive word-of- mouth to others.
In the last outcome, the dissatisfied customer will try to
reduce the dissonance by:
i. Abandoning or returning the product or
ii. Seek information that will re-inforce its high value or
iii. Ignore information indicative of its low value.
In extreme cases, the consumer could also approach the Consumers
Forum for a redressal. Thus, the marketer must ensure that
consumers do not experience post-purchase dissatisfaction. And if
at all they do, the complaints must be attended to at earliest, so that
the customer dissatisfaction gets reduced considerably.