UNIT 4

BUYING DECISION
PROCESS
 TOPICS
• Buying roles
• Buying behaviour
• Levels of consumer decision making
• Models of consumers
• Consumer Adoption process
• The stages of buying – decision process.
 INTRODUCTION
• The Consumer Decision Processes (also known as Buyer Decision
Processes) refer to the decision-making stages that a consumer
undergoes before, during, and after they purchase a product or
service.

John Dewey introduced 5 stages which consumers go through when

they are considering a purchase:
• Problem or need recognition
• Information search
• Evaluation of alternatives
• Purchase
• Post-purchase behaviour
• Availability of alternatives
• Choice
• It is a process
• Simple to complex
• Different components/aspects of decision
making
• Bases for decision making – rational/irrational;
emotional; need/drive; information processing
LEVELS OF CONSUMER DECISION MAKING

EXTENSIVE PROBLEM SOLVING

LIMITED PROBLEM SOLVING

ROUTINIZED RESPONSE BEHAVIOUR

1. Extensive problem solving
• No established criteria for evaluation of
product
• Need more information for decision making
• Different variety of information and brands
• Situations – first time, expensive, important,
technically sophisticated etc.
• E.g Automobiles, machinery, electronic
appliances etc
2. Limited Problem solving
• Consumers have already established basic
criteria for evaluation and various brands
• Search for additional information; fine-tuning
• Discrimination can be employed
• Situation – to buy a new version or updated
version of a product or brand already in use.
• E.g. Replacement, exchange offers etc
3. Routinized response behaviour
• Presence of well established set of criteria for
product category
• Little information or just review the available
information

Routinized limited Extensive

Information continuum
 MODELS OF CONSUMERS

ECONOMIC PASSIVE
VIEW VIEW

COGNITIVE EMOTIONAL
VIEW VIEW
 Economic View
• School of economics – In a perfect competition market, consumers are rational
decision – makers.
• Situations under which it exits:
(i) consumers fully aware of all product alternatives
(ii) capable of correctly ranking each alternative in terms of its benefits and
disadvantages
(iii) able to identify best alternative

Economic consideration for purchase:

(i) Marginal utility is the added satisfaction a consumer gets from having one
more unit of a good or service. To determine how much of an item consumers are
willing to purchase.
(ii) Price-quantity relationship
(iii) Indifference curve - An indifference curve shows a combination of two goods
that give a consumer equal satisfaction and utility thereby making the consumer
indifferent.
• Criticism – idealistic and simplistic
• Consumers are not fully rationalistic for the
following reasons:
People are limited by their:
(i) existing skills, habits, and reflexes
(ii) values and goals
(iii) extent of their knowledge
The consumer will settle down for a
‘satisfactory’ decision and not necessarily the
best one though it will be a ‘good enough’
decision.
 Passive view
• Bases – consumers are impulsive and irrational
• Consumers are object of manipulation
• The responsibility of sales rests with the
marketers
• The consumers are disregarded for their needs
and preferences
• It is unrealistic view of humans and consumers
• Ethical issues are present
 Cognitive view
• Basic notion – consumers are thinking problem solvers
• Information processors – lead to preferences and
intentions to buy
• Receptive or actively search information
• Heuristics – short cut to decision rules ; to cope with
information overload
• In between economic and passive view
• Consumer behaviour is goal directed
 Emotional view
• Consumers have emotions and liking towards
products that make them choose.
• They are highly involving
• Superstitious beliefs – meaningful role in
purchasing related decision making; unconscious
• Emotional attachment to objects – sense of the
past; transitional objects
• Impulsive, emotional purchase decision
• Deserving the products; “treating yourself”
Consumers mood and emotions
• Moods is a feeling state/state of mind
• Unfocused and pre-existing state
• Lower in intensity and long lasting
• Mood impacts – when, where and whether
consumers shop
• Difference between mood and emotions –
emotions are a reaction to stimuli in environment
• Marketers attempt to induce a positive mood
• Aim: obtain insights that can be developed into
goals and articulated through advertisements.
 The Adoption Process
Acceptance of new products involves two major
processes: Diffusion and adoption.

Diffusion process: spread of new product in the

market and reaching the consumer (macro process)

Adoption process: the stages through which an

individual consumer passes when deciding to
accept or reject a new product.
 Stages in Adoption process
Name of the stage Process

Awareness Consumer is first exposed to the product

innovation

Interest Consumer is interested in the product and

searches for additional information

Evaluation Consumers decide to buy whether or not

to believe that like this product or service
will satisfy the need - like mental trial
Trial Consumers use the products on a limited
basis

Adoption (or rejection) If trial is favourable, consumer decides to

use the product completely., if
unfavourable then rejects.
Evaluation of Adoption process:
• Criticism that preceding stage of need
recognition to awareness stage is not discusses
in this model
• Adoption can have minimal or major
consequences in behavioural and lifestyle
changes – e.g. technology driven consumerism
• It gives a framework to decide which type of
information sources consumers find most
important in each decision stage
• Significance of interpersonal information source
and mass media
The buying decision – Five stage model

Post
purchase
Purchase behaviour
decision
Evaluation
of
Information alternatives
search
Problem
recognition
1. Problem Recognition
• Need is triggered by an internal or external stimuli
• Marketers identify the circumstances that trigger a
particular need by gathering information from consumers,
hence form marketing strategies that trigger interest.

2. Information search
• Levels of consumer involvement:
(i) Heightened attention – milder search state; more
receptive to information about the product
(ii) Active information search – looks for materials to
learn more about the product like manuals, online, visiting
stores etc
Information sources
1. Personal – family, friends, neighbours and
acquaintances
2. Commercial – advertising, websites, salesperson,
dealers, displays etc.
3. Public – mass media, consumer rating organizations
4. Experimental – handling, examining and using the
product

• Influence of source – depends on product category

and characteristics of buyers
• Marketer-dominated – for information value
• Personal sources – legitimizing evaluation function.
Search dynamics
Market partitioning: identifying the hierarchy of attributes
that guide consumer decision making to understand
different competitive forces and how these sets form

1. Brand- dominated hierarchy

2. Type dominated hierarchy
3. Nation- dominated hierarchy
4. Quality/service/price dominant

Companies have to strategies to bring their products into

different sets
Identify the information source and its importance
3. Evaluation of alternatives
• The consumers mostly decide consciously and
rationally
• Primary – consumers satisfy needs
• Secondary – search for benefits
• Tertiary – sees each product as bundle of
attributes with varying abilities for delivering
benefits sought to satisfy their needs
• Attributes vary – for e.g. hotels, mouth-wash,
tyres
• Consumers pay most attention to those attributes
that deliver the sought-after benefits.
Beliefs and attitudes
Belief – a descriptive thought about the product
Attitude – an enduring favourable or unfavourable
evaluation, feelings and action tendencies towards
some object or idea
Attitude is consistent and is difficult to change;
companies try to fit into well established attitude

Expectancy – Value model

The consumers form attitude by evaluating the products
and services by combining their brand beliefs – the
positive and negative according to the importance
Strategies to inculcate interest in the products over the
competitors:
1. Real repositioning – redesigning the product
2. Psychological repositioning – alter beliefs about the brand
3. Competitive depositioning – alter beliefs about the
competitors brand; when buyers perceive the competing
brand has more quality than it actually has
4. Alter the importance weights – markets persuade the
buyers to attach more importance to attributes in which the
brand excels
5. Call attention to neglected attributes
6. Shift the buyers ideal – persuade the buyers to change
their ideal levels for one or more attributes
4. Purchase Decision
• Consumers already have made the preferences and intention to buy
• Decisions are subdivided into:
1. Brand
2. Dealer
3. Quantity
4. Timing
5. Payment method
Noncompensatory model of consumer choice
• Consumers make mental shortcuts using simplifying choice heuristics
1. Conjunctive heuristic – consumers sets a minimum acceptable cut-off level for each
attribute and chooses the first alternative that meets the minimum standard of all
attributes.
2. Lexicographic heuristic – consumer chooses the best brand on the basis of the
perceived most important attribute
3. Elimination by aspect heuristic – consumer compares brands on an attribute
selected probabilistically – where the probability of choosing an attribute is positively
related to its importance and eliminates brands that do not meet minimum
acceptable cut-off.
• Use of heuristic depends upon product knowledge, similarity
of brand choice, time pressure involved, social context
• Adopt more than 1 heuristic
• Intervening factors between purchase intention and purchase
decision
1. Attitude of others
2. Unanticipated situational factors
Influence of attitude of others:
a. intensity of other person’s negative attitude towards our
preferred choices
b. our motivation to comply with the other person’s wishes

Infomediaries –disseminate their evaluations. Product testing

reports in magazines, websites, e-forums etc.
Perceived risk – influences the decision to modify, postpone or avoid
purchase decision. Types of risk:
1. Functional risk – product does not perform up to expectations
2. Physical risk – product poses a threat to physical well-being of the
user or others
3. Financial risk – product is not worth the price
4. Social risk – product results in embarrassment from others
5. Psychological risk – product affects mental well-being of the user
6. Time risk – failure of the product results in an opportunity cost of
finding another satisfactory product

• The amount of perceived risk varies with the amount of money at

stake, the amount of attribute uncertainty and the amount of
consumer self-confidence.
• Consumers tend to avoid risk by avoiding decision, gathering more
information from known source, go for brands and warranties etc
5. Post purchase behaviour
Marketers should communicate beliefs and
evaluations that reinforce the consumers choice
and help him feel good about the brand
(i) Post purchase satisfaction
Satisfaction is the function of closeness
between expectations and the product perceived
performance. It can be – satisfaction,
disappointed or delighted.
Consumers coping style – magnify the gap
between expectation and performance highly
dissatisfied; or minimize and less dissatisfied
(ii) Post purchase actions
• Satisfaction or dissatisfaction leads to repeat purchase or
complaints about the product.
• Take either public action or private action. E.g. file
grievance, lawsuit, negative ratings etc.
• Post purchase communication include – solicit customer
suggestions, keep giving titbits on usage, location for allied
services, satisfactory reviews etc.
(iii) Post purchase use and disposal
• Marketers should monitor consumption rate
• Speed up replacement rate
• Give information about correct usage and promote good
replacement rate
• Be aware of disposal methods also