Consumer Decision Process

Consumer Decision-Making Process

Types of Consumer Decisions
• Problem recognition

• Purchase involvement
Contd….
• Purchase involvement
• influenced by the interaction of individual, product and situational
characteristics
• Forms of involvement and outcomes
• Habitual decision making—single brand
• Limited decision making
• Extended decision making
• Implications for strategy
Contd….
Habitual buying behavior occurs when consumers have low
involvement and there is little significant brand difference.
Low purchase High purchase
involvement involvement

Habitual Limited Extended

decision decision decision
making making making

Level of Involvement: An individual’s intensity of interest in a product

and the importance of the product for that person
Contd….
• Habitual decision making is in effect no decision at all: a single brand
choice can solve the problem and requires very little (internal)
searching for information. It occurs when occurs when consumers have
low involvement and there is little significant brand difference.
• Extended or Complex decision making is at the other end of the
continuum, where a number of brands within the product category can
reduce the discrepancy between the actual state and the desired state.
The consumer is compelled to search for information both internally
and externally in order to reach a purchase decision. Fortunately, few
purchases are in this area. However, some examples could be a car, a
house or a computer.
Extended or Complex Decision Making
When consumers are highly motivated in a purchase and perceive
significant differences among brands

Purchasers are highly motivated when:

• Product is expensive
• Product is risky
• Product is purchased infrequently
• Product is highly self-expressive
Contd…..
• A purchase in the habitual area often requires no or very little
decision making, while in contrast a purchase in the extended
decision making area requires complex decision making.
• There is seldom any post purchase dissonance with habitual decision
making and very little evaluation. In contrast, with extended decision
making there is quite often some form of post purchase dissonance
which can also involve complex evaluation as to whether or not the
correct decision was made.
• Internal Search: An information search in which buyers search their
memories for information about their products that might solve their
problem.
• External Search: An information search in which buyers seek
information from sources other than memory.
Problem/need Recognition by Consumers
• To understand how consumers behave during this early stage of
decision making it is necessary to pose a number of questions:
• Do consumers readily recognise that they have a need for the product
or service?
• If not, can this be activated?
• What are the major influences on consumers? And how does this vary
from one consumer to the next?
• How can this knowledge be used to devise a suitable marketing
strategy?
Contd….
The process of problem recognition

• The nature of problem recognition

• Desired state
• Actual state
• Problem recognition involves recognising the existence of a discrepancy
between the consumer’s desired state (what the consumer would like) and the
actual state (what the consumer perceives as already existing). Both the desired
state and the actual state are influenced by the consumer’s lifestyle and current
situation. If the difference between these two states is sufficiently large and
important, the consumer will begin to search for a solution to the problem.
Contd….
• The very first step in the process is when consumers realize that they have a need for something.
Marketers want to create an imbalance in consumers between their present status and their
preferred status. This imbalance will create a need and make a consumers search out and buy a
product or service.
• Need recognition occurs when a consumer is faced with a difference between an actual and a
desired state. A need can occur immediately and can be a very basic impulse that you experience,
such as when the ninja develops hunger pains. This is called an internal stimulus. Or it can be a
change in the ninja's lifestyle, such as when he finds out that he is going to be expecting a baby
ninja.
• An external stimulus is when you are affected by outside influences, such as when a friend tells you
about a fantastic movie, restaurant or an ad for a car. The key weapon of a marketer to create an
imbalance/consumer need is to use advertising and sales components. When consumers recognize
an unfulfilled need and that a product will satisfy it, they have created a want. The marketer can
then tailor new products and current products to reach the consumers and create a successful
purchase situation.
The Process of Problem Recognition
Contd…
Products are positioned as providing a potential solution eg. shampoo
Products are positioned as providing a
potential solution eg. cough medicine
Types of consumer problems
• Active problem
• A problem the consumer is aware of, or will become aware of, in the normal
course of events.
• Marketing Strategy: Only require marketer to convince consumer that
its brand is the superior solution.
• Inactive problem
• A problem of which the consumer is not yet aware.
• Marketing Strategy: Marketer must convince consumers that they
have the problem and that their brand is a superior solution.
Types of consumer problems
and action required

• Routine problems
• Expected, require immediate solution
• Emergency problems
• Not expected, require immediate solution
• Planning problems
• Expected, don’t require immediate solution
• Evolving problems
• Not expected, don’t require immediate solution
Non-marketing factors affecting
problem recognition
Marketing strategy and
problem recognition (Measuring problem recognition)
• Before marketing managers can affect problem recognition, they must
be able to measure it. This may involve qualitative market research
techniques. Some examples of problem recognition are found in the
activity analysis surrounding meal preparation: a desire for healthy,
tasty and quick-to-prepare meals has provided an opportunity to
market instant meals for busy people.
• Problems involving the product should be known: consumers are
asked about the purchase and/or the use of a particular product or
brand.
• Problems with using the product should be known: e.g. DVD
player/recorders that are difficult to tune or packages that are difficult to
open.
• Human factors research can involve observations, such as supermarket
shoppers queuing at the checkout. When queues get too long they become
very frustrated and may choose another store.
• Emotion research could involve focus groups to discover how consumers
feel about the brand or product.
• Some of the methods are Observation, Focus groups (10–12 people in a
group), Panels (can be contacted by mail and email), Indepth interviews, and
Means-end to find consumers’ deeper motivations
Marketing strategy and
problem recognition
• Measuring problem recognition

• Activity analysis—study of meal preparation

• Product analysis—problems using it?
• Problem analysis—product/brand solutions?
• Human factors research—suit users
• Emotion research—how people feel about it
Responding to consumer problems
• Activating problem recognition
• Promotion is an important vehicle used by the marketers to cause problem recognition to
occur potential customers. Activities may be focused on consumer’s desired state and/or
perceptions of the actual state, such that a difference of such sufficient magnitude occurs
between them.

• Now once a consumer problem is identified, the managers may structure the
marketing mix to solve the problem.
• This can involve:
• Developing a new product or altering the existing one.
• Modifying channels of distribution
• Changing pricing policy
• Revising advertising strategy
Contd….
• Activating problem recognition
• Generic problem e.g. dairy foods
• when the problem is latent or of low importance

• Selective e.g. one brand solution

Example:
• Marketers can instigate the problem recognition and guide consumers to their
products: for example, the dairy industry may want to raise the problem of
osteoporosis in women, and provide information about the high calcium content of
dairy foods. All (dairy) products will solve the generic problem.
• A selective approach refers to the recognition that only one brand in the category
will solve the problem, e.g. Nurofen for pain.
Contd….
An active attempt
to activate
problem
recognition
Responding to
a recognised
problem
Responding to consumer problems
Contd….
• Suppressing problem recognition

• Avoid upsetting habitual buyers

• Anticipate and counteract negatives

• Marketers may desire to suppress any problems, especially if habitual
buyers are likely to start searching for other brands or product
categories. Product attributes or quality, rather than prices, may need
to be brought to the attention of regular consumers.
Contd….