assignment on buyers decision making process

8/6/2019 Assignment on Buyers Decision Making Process

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AN ASSIGNMENT ON:

Buyers Decision Making

ProcessSubmitted by-

Pooja Dubey

Roll No.-47

Session- 2009-2011

INSTITUTE OF MANAGEMENT STUDIES,

RANCHI UNIVERSITY


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Variables that shape the decision process:

VARIABLES THAT SHAPE THE DECISION PROCESS

Individual differences:

y demographics, psychographics, values, personality, lifestyley consumer resources (time, money attention * information reception and

processing capabilities)

y motivationy knowledge (information stored in memory)y attitudes (overall evaluation of an alternative)

E

nvironmental influences:

y culturey social classy family (the primary decision-making unit)y personal influencesy situation

Psychological processes

y information processingy learning (process whereby experience leads to changes in behaviour)y attitude and behaviour change


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Consumer Information Processing Model

Figure :- The Consumer Information Processing Model

In this model, the consumer passes through five stages: problem recognition, information

search, evaluation and selection of alternatives, decision implementation, and post-purchase

evaluation.

Problem Recognition

In this information processing model, the consumer buying process begins when the buyer

recognizes a problem or need. When we found out a difference between the actual state and a

desired state, a problem is recognized. When we find a problem, we usually try to solve the

problem. We, in other words, recognize the need to solve the problem.

Search for information:Types:

y Internal: retrieving knowledge from memory or genetic tendencies.

Problem Recognition

Information Search

Evaluation and Selection of Alternatives

Decision Implementation

Post-purchase Evaluation


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y External: collecting information from peers, family and the marketplace.Sources of information:

y Marketer dominated: anything the supplier does to inform and persuadey Non-marketed dominated: friends, family, opinion leaders, media, WOM.

Information processing:

y Exposure * Attention * Comprehension * Acceptance * RetentionEvaluation andSelection of Alternatives

Pre-purchase alternative evaluation:y Evaluative criteria: standards used to compare different products & brands.y Salient attributes: the most important.y Determinant attributes: details that determine which brand or store consumers choose .

Purchase to decide whether to purchase:

Choose one retailer (catalogues, ads on TV)

In-store choices (salespersons, product displays at POP)

There are 2 options to evaluate the different choice alternatives:

Rely on pre-existing evaluations: prior consumption of the product leads to the formation of

evaluation that is stored in memory. If the relevant evaluations are retrieved during internal

search, then each can be compared to determine which considered alternative is most liked

(eg: Coke or Pepsi, Mcdonald's or Burger King?).

Constructing new evaluations: in many circumstances consumers may be unable or unwilling

to rely on their pre-existing evaluations for making a choice (eg: NCUs). There are 2 basic

processes by which consumers can construct evaluations:

y Categorisation process: evaluation of a choice alternative depends on the particularcategory to which is assigned (general product category: motorised forms of

transportation; specific product category: Harley Davidson motorcycles). The

phenomenon of brand extensions occurs when a well-known and respected brand

from one product category is extended into other product categories.


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y Piecemeal process: an evaluation is derived from consideration of thealternative's advantages and disadvantages along important product dimensions.

Once the consumer has selected the different choice alternatives, he/she has to apply

a decision rule, or evaluation strategies:

Non-compensatory evaluation strategies: a product weakness on one attribute cannot be

offset by its strong performance on another attribute (eg: if you reduce the oil and salt in chipsto make them healthier, consumers won't buy them):

* Lexicographic strategy: brands are compared initially on the most important attribute. The

brand perceived as superior is bought.

* Elimination by aspects strategy: the consumer imposes cut-offs (eg: must be under 2) and if

only one brand passes it will be chosen, if more than one pass then the prior strategy will be

applied.

* Conjunctive strategy: the consumer establishes a set of cut-offs and the brand that meets all

the cut-offs will be chosen.

Compensatory evaluation strategies: a perceived weakness of one attribute may be offset by

the perceived strength of another attribute:

* Simple additive: the consumer simply counts or adds the number of times each alternative is

judged favourably in terms of the set of salient evaluative criteria

* Weighted additive: the consumer now engages in more refined judgements about the

alternative's performance than simply whether it is favourable or unfavourable. These

judgements are then weighted by the importance attached to the attributes.

Decision Implementation

To actually implement the purchase decision, however, a consumer needs to select both

specific items (brands) and specific outlets (where to buy) to resolve the problems. There are,

in fact, three ways these decisions can be made: 1) simultaneously; 2) item first, outlet second;

or 3) outlet first, item second. In many situations, consumers engage in a simultaneous

selection process of stores and brands.

Post-purchaseEv

aluation

Post-purchase evaluation processes are directly influenced by the type of preceding decision-

making process. Directly relevant here is the level ofpurchase involvementof the consumer.

Purchase involvement is often referred to as the level of concern for or interest in the

purchasesituation, and it determines how extensively the consumer searches information in

making a purchase decision. Suppose one buys a certain brand of product (e.g., Diet Pepsi) as a


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matter of habit (habitual purchase). For him/her, buying a cola drink is a very low purchase

involvement situation, and he/she is not likely to search and evaluate product information

extensively. In such a case, the consumer would simply purchase, consume and/or dispose of

the product with very limited post-purchase evaluation, and generally maintain a high level of

repeat purchase motivation (Figure).

Figure :- Low Involvement Purchase

However, if the purchase involvement is high and the consumer is involved in extensive

purchase decision making (e.g., personal computer), he/she is more likely to be involved in

more elaborate post-purchase evaluation often by questioning the rightness of the decision:

Did I make the right choice? Should I have gone with other brand? This is a common reaction

after making a difficult, complex, relatively permanent decision. This type of doubt and anxiety

is referred to aspost-purchase cognitive dissonance.

The idea of the information processing model seems reasonable. But, we know that we

as individuals are not living in a vacuum. That is, when we are making a purchase decision, we

are constantly influenced by other factors than just information, such as family, friends, cultural

values, social class, or subculture.

Purchase Product UseSimple

EvaluationDisposition

Repeat Purchase

Motivation

Purchase Product UseElaborate

EvaluationDisposition

Dissatisfaction

Repeat Purchase

Motivation

Post-purchase

Dissonance

assignment on buyers decision making process

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