MKT 7001

Consumer decision making process

Lecture 4

LECTURER
Augustine Png
Copyright 2011 Singapore Cruise Centre Pte Ltd
 Learning outcomes

1. Critically evaluate customer groups and how

their buying habits match to organisational
goals.

2. Evaluate decision making-processes and

customer behaviour in both B2C and B2B
contexts.
Model of consumer decision making process
from
Kotler and others, Principles of Marketing

Copyright © 2017, 2014, 2009 Pearson Education, Inc. All Rights Reserved
Model of consumer behaviour

Copyright © 2017, 2014, 2009 Pearson Education, Inc. All Rights Reserved
Kotler’s Model of consumer behaviour

External Buy
stimulus
Decision making
processes
Internal Don’t Buy
stimulus

Copyright © 2017, 2014, 2009 Pearson Education, Inc. All Rights Reserved
Model of consumer decision-making
process
 Consumer decision process :
Need recognition

• Occurs when the buyer recognises a

problem or need triggered by:
 Consumer decision process :
Information search

• Personal sources—family and friends

• Commercial sources—advertising, Internet
• Public sources—mass media, consumer
organisations
• Experiential sources—handling, examining,
using the product.
 Consumer decision process :
Evaluation of alternatives

• How the consumer processes information

to arrive at brand choices.
 Consumer decision process :
Purchase decision

• The act by the consumer to buy the most

preferred brand.
• The purchase decision can be affected by:
– attitudes of others
– unexpected situational factors.
 Consumer decision process :
Post-purchase behaviour
• The satisfaction or dissatisfaction that the
consumer feels about the purchase.

• Relationship between:
– Consumer’s expectations
– Product’s perceived performance.

• The larger the gap between expectation and

performance, the greater the consumer’s
dissatisfaction.
 Consumer decision process :
Post-purchase decision

Customer satisfaction is a key to building

profitable relationships with consumers —to
keeping and growing consumers and reaping
their customer lifetime value.
 Consumer decision-making process

The processes through which the customer moves when

deciding to purchase a product are:

• Need recognition – I am thirsty and I need a drink

• Information search – Where can I get a drink?
• Evaluation of alternatives – I can have Coke or Green
tea drink
• Purchase decision – I want a healthy green tea drink
• Post purchase behaviour – Did it quench my thirst?
 Consumer decision process :
Need recognition

• Occurs when the buyer recognises a

problem or need triggered by:
– Internal stimuli
– External stimuli.
Information Search
 Cost versus Benefits

• Actual cost
• Subjective cost
– Time
– Anxiety
• Opportunity cost
 Level of Motivation

• Level of involvement
• Need for cognition
• Level of shopping enthusiasm
 Ability to Search

• Determines extent of search

• Education level
– Increases search
• Knowledge of product and brands
– Moderate level – most likely to search
 Evaluation of alternatives

• Our evaluation of alternatives is influenced by

three components:

a) Affective – feelings and emotions

b) Cognitive – knowledge and understanding
c) Conative – intentions and behaviour
 Attitude Sequence?

Cognitive  Affective  Conative

Affective  Conative  Cognitive
Conative  Cognitive  Affective
 Consumer decision process :
Post-purchase decision

Do all consumer evaluate all their purchases?

Even assuming that they do, when do they

evaluate their purchases? Immediately after
purchase, before the next purchase or in-
between?
Purchase decision
 Purchase decision

Does a change in thinking cause a change in

behaviour (cognitivism) ?

or

Does a change in behaviour cause a change in

thinking (behaviourism) ?
 Cognitivist approach

Cognitivist believed that thought and feeling can

produce change in action directly. The cognitivist
thinking lies behind rational accounts of
consumer decision-making. From a cognitivist
perspectives, people’s thoughts and feelings are
indicators of their potential behaviour. Hence
behavior may be modified by communications
that change attitudes and knowledge.
 Behaviourist approach

Behaviourist believed that thought and feeling are

effects and not causes; like ripples on the surface
of a pond, they indicate the fish’s movement but
do not move the fish. We can use people’s
thoughts and feelings as indicators of their
potential behavior but not as explanations for it.
 Behaviourist approach

Does our thoughts control our behaviour ?

If not, what then controls our behavior ?

• Habits
• Beliefs
• Values
• Social norms
• Etc.
Conscious and Sub-conscious mind
 Pros and Cons of Kotler’s model of
consumer decision making process
Pros:

1. Logical and rational model. It provides a straightforward

and easy to follow framework for understanding how
decisions are made.

2. Kotler’s model addresses all the key stages in the

consumer buyer decision making process, and allows
marketers to plan for activities to influence the decisions.
 Pros and Cons of Kotler’s model of
consumer decision making process
Cons:

1. Kotler’s model is not valid for all types of purchases e.g.

purchases of low value items

2. The model does not explain repeat purchases which could lead
to the skipping of some stages in the decision making process.

3. The model does not recognise that purchase decision could

result from learned behavior or reinforcement

4. The model assumed rationality in all decision making. In reality

some decision making could be based on emotion or habits.

5. The model assumed that decisions are made by people acting

on their own, but this may not be so.
 Variation in decision-making
Limited Decision-Making
Limited Decision-Making occurs when consumers
have some knowledge or partial knowledge about
what they want to purchase, or when the product
is inexpensive. In order to arrive at a decision,
some comparative product/brand information is
sought before a purchase
Habitual Buying Behaviour
At this level, the consumer knows very well about
the different brands and he can differentiate
between the different characteristics of each
product, and he already decides to purchase a
particular product. This is also the buying
behaviour of a satisfied consumer who is doing a
repeat buy.
Extended Decision-Making
Extended Decision-Making occurs when consumer
does not have any basic information or knowledge
about the product or does not have any
preferences for any product or when the product is
rather expensive. In this situation, the consumer
will seek information about all the different
products or brands in the market before a
purchase.
Variety-Seeking Buying Behaviour
At this level, the consumer knows very well about
the different brands and he can differentiate
between the different characteristics of each
product, but as there are visible differences
between products/brands, the consumer wants to
try out a different product/brands out of curiosity or
otherwise.
 Models of buyers’ behaviour
Cognitive analytic decision- Cognitive prescriptive decision-
making models making models

- Choice is controlled by factors in - Choice is controlled not by

the alternatives in decision comparing alternatives but by
making model i.e. decision rest factors such as beliefs,
on alternatives attitudes, intentions etc.

Cognitive model of buyer Cognitive prescriptive model of

behaviour buyer behaviour

- Choice is controlled by factors in - Choice is controlled by

the environment i.e. stimuli in managing stimuli (brand,
the environment facilitate some product, price, etc.) that have
alternatives more than others. become associated with a
product.
 Thank You

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