CONSUMER DECISION
MAKING
Consumer Decision making is a
central part of consumer behavior
but the way we evaluate and
choose products varies widely.
How do you choose the food that you
eat?
Stages in CDM
Decision making
perspectives
Rational
Carefully integrating
information about the
product e.g cooking oil
Behavior influence
Based upon
environmental cues e.g
attention grabbing
packages.
Experiential
Offerings that create a
positive emotional
response e.g. buying the
same chocolate again
A continuum of buying decision
behavior
Characteristics of limited vs. extended
problem solving
•
•
•
•
Motivation:
● Low risk vs. high risk
● Low involvement vs. high involvement
Information search
● Little search vs. extensive search
Alternative Evaluation
● Weakly held beliefs vs. strongly held beliefs
Purchase
● Limited time vs. ample time
● Influenced by store displays vs. communication
with store personnel
STAGE 1: PROBLEM RECOGNITION
K & Ns - Safe and
Healthy chicken
( Opportunity)
Home cooked
Chicken
( Actual State )
Chicken not available
Market closed/ Bird flu
( Need )
NO PROBLEM
Acceptable state
OPPORTUNITY
Ideal states goes up
NEED
Actual state
goes down
STAGE 2: INFORMATION SEARCH
•
Deliberate Search
● Directed learning
● Purchase based upon previous
knowledge
•
Accidental Search
● Incidental learning
● Purchase based upon mere exposure
DO WE ALWAYS SEARCH OR BUY
RATIONALLY?
MENTAL ACCOUNTING
•
This process demonstrates that the way we pose a
problem and whether it’s phrased in terms of gains
or losses influences our decisions.
Add picture
HOW MUCH DO WE SEARCH?
STAGE 3: EVALUATION OF ALTERNATIVES
Purchase decision at the stage where we have to
choose a product from several alternatives
●
E.g different types of burgers of the same brand
● Different franchises of burgers
•
Evoked Set:
•
Alternatives a consumer already knows about (knowledge of
the shampoo brands)
•
Consideration Set:
●
Alternatives that a consumer actually considers while
purchasing (based upon price range, availability, past
experience)
PRODUCT CATEGORIZATION
•
First: Superordinate level (general categorydessert)
•
Second: Basic level (sugar vs. sugar free)
•
Third: Subordinate level
● Sugar: brownies, donuts, bounty
● Sugar-free: wheatables, mithai, chamam ice
cream
STAGE 4: PRODUCT CHOICE
Once we assemble and evaluate the relative options
in a category, eventually we have to choose one.
•
Evaluative criteria
Dimensions we use to judge the merits of competing
options
●
Determinant attributes: Features we use to
differentiate among our choices (yoghurt: texture, taste,
nutritional value, price, freshness, size of packaging)
● Differences in products carry more weightage in the
decision process than do similarities
HEURISTICS (RULE OF THUMB):
•
If a salad is green, its fresh
•
Nutritional chart given, high quality product
•
Pioneer product (e.g national foods/ nestle)
What heuristic approach do you use while buying
foods?
MARKET BELIEFS
•
Brand
●
•
Store
●
•
Sales are typically run to get rid of slow moving
merchandise/ defected stuff
Advertising & sales promotion
●
•
Larger stores offer more variety (Alfatah/Hyperstar)
Price/discount/sale
●
•
The best brands are the ones purchased the most
Items tied to giveaways are not a good value (Vim +
maggie noodles) or (free product is of low quality)
Product/packaging
●
Large size containers are cheaper compared to
individual small size packing ( coke vs. coke carton)
DECISION RULES
•
Consumers rely on different decision rules when
they evaluate competing options
●
Non-compensatory decision rules: When we feel that
a product with a low standing of one attribute can’t
compensate for this flaw even if there is another better
attribute (e.g size of TV screen small, but good picture
quality)
●
Compensatory decision rules: When a product has a
chance to make up for its shortcoming (though the pizza
is small but good topping)
STAGE 5: OUTCOMES
This is the final stage of decision
making where you buy the product of
your choice and leave the rest
Happy decision making! :D
MARKETERS APPROACH