Monday 15 August 2011

5 Stage Model of Buying Decision Process

5.3.1 Problem Recognition
The buying process starts when the buyer recognises a problem or need. The need can be triggered by internal or external stimuli. Marketers need to identify the circumstances that trigger a particular need so that they can develop marketing strategies that trigger consumer interest.

After enrolling in the university, students require themselves to own a notebook to complete
assignment given by the lecturer. Those who yet to own one, will recognize this as their problem that is to find the right notebook at an affordable price with good features.

5.3.2 Information Search
An aroused consumer will be inclined to search for more information. Two types of arousal:

Milder state is called heightened attention where a person simply becomes more receptive to information about a product.

Active information search where a person looks for reading material, going online, etc. to learn about the product.

(a) Information Sources
Major information sources to which consumers will turn fall into four groups:

(i) Personal. Family, friends, neighbours, acquaintances.
(ii) Commercial. Advertising, Web sites, salespersons, dealers, packaging, displays.
(iii) Public. Mass media, consumer-rating organisations.
(iv) Experiential Handling, examining, using the product.

Consumer receives the most information a about a product from commercial sources (i.e. marketer-dominated-sources). The most effective information often comes from personal sources or public sources that are independent authorities.

Commercial sources normally perform an information function, whereas personal sources perform a legitimising or evaluation function.

(b) Search Dynamics
Through gathering information, the consumer learns about competing brands and their features. Marketer identify the other brands in the consumer's choice set so that it can plan the appropriate competitive appeals.

In addition, the company should identify the consumer's information sources and evaluate their relative importance. Asking consumers how they first heard about the brand, what information came later, and the relative importance of the different sources will help the company prepare effective communications for the target market. For example, before buying the notebook, students will browse through the Internet to search for information about the notebook that being sell at an affordable price with good features. They may also ask friends for
recommendations.

5.3.3 Evaluation of Alternatives
Consumer evaluation processes include:
Trying to satisfy a need.
Looking for certain benefits from the product solution.
Sees each product as a bundle of attributes with varying abilities for delivering the benefits sought to satisfy this need.

(a) Beliefs and Attitudes
Evaluations often reflect beliefs and attitudes. Through experience and learning, people acquire beliefs and attitudes. These in turn influence buying behaviour.

(i) Belief - a descriptive thought that a person holds about something.
(ii) Attitude - a personÊs enduring favourable or unfavourable evaluation, emotional feeling, and action tendencies toward some object or idea. Attitudes put people into a frame of mind. Attitudes lead people to behave in a fairly consistent way toward similar objects. Attitudes can be very difficult to change.

(b) Expectancy-Value Model
The expectancy-value model of attitude formation posits that consumers evaluate products and services by combining their brand beliefs·the positives and negatives - according to importance.
Marketers apply the following strategies to stimulate greater interest in alternative brand:

(i) Redesign the computer. This technique is called real repositioning.
(ii) Alter beliefs about the brand. Attempting to alter beliefs about the brand is called psychological repositioning.
(iii) Alter beliefs about competitors' brands. This strategy, called competitive depositioning, makes sense when buyers mistakenly believe a competitor's brand has more quality than it actually has.
(iv) Alter the importance weights. The marketer could try to persuade buyers to attach more importance to the attributes in which the brand excels.
(v) Call attention to neglected attributes. The marketer could draw buyers' attention/ neglected attributes, such as styling or processing
speed.
(vi) Shift the buyer's ideals. The marketer could try to persuade buyers to change their ideal levels for one or more attributes.
For example, after collecting information on the notebook, students will have several brand of notebook that suits their expectation, that is of their interest. At this phase, they will evaluate those brands of notebook based on the set criteria.

5.3.4 Purchase Decision
In the evaluation stage, the consumer forms preferences among the brands in the
choice set. The consumer may also form an intention to buy the most preferred brand. In executing a purchase intention, the consumer may make up to five subdecisions:
(i) Brand.
(ii) Dealer.
(iii) Quantity.
(iv) Timing.
(v) Payment-method.
For example, at this stage students have made up their decision to buy which notebook. They will purchase identified notebook according to their most preferred brand that they afford to buy and have good features.

(a) Non-Compensatory Models of Consumer Choice
Consumers may not always want to invest so much time and energy to evaluate brands. They often take „mental shortcuts‰ that involve various simplifying choice heuristics. With non-compensatory models of consumer choice, positive and negative attribute considerations do not necessarily net out.
(i) With conjunctive heuristic method, the consumer sets a minimum acceptable cut-off level for each attribute and chooses the first alternative that meets this minimum.
(ii) With the lexicographic heuristic method, the consumer chooses the best brand on the basis of its perceived most important attribute.
(iii) With the elimination-by-aspects heuristic method, the consumer compares brands on the attribute selected and brands not meeting this attribute are eliminated.
(iv) Consumers do not adopt only one type of choice rule and may combine two or more decision rules.
(b) Intervening Factors
Two general factors can intervene between the purchase intention and the purchase decision:

(i) Attitudes of others. The extent to which another person's attitude reduces the preference for an alternative depends on two things
The intensity of the other personÊs negative attitude toward the consumerÊs preferred alternative.

The consumer's motivation to comply with the other person's wishes.

(ii) Unanticipated situational factors that may erupt to change the purchase intention.

Preferences and even purchase intentions are not completely reliable predictors of purchase behaviour.

Consumers may perceive many types of risk in buying and consuming a product:

Functional risk - The product does not perform up to expectations.
Physical risk - The product poses a threat to the physical well being or health of the user or others.
Financial risk - The product is not worth the price paid.
Social risk - The product results in embarrassment from others.
Psychological risk - The product affects the mental well-being of the user.
Time risk - The failure of the product results in an opportunity cost of finding another satisfactory product.

Marketers must understand the factors that provoke a feeling of risk in consumers and provide information and support to reduce perceived risk.

5.3.5 Post-Purchase Behaviour
Marketers must monitor post-purchase satisfaction, post-purchase actions, and post-purchase uses as the consumer might experience dissonance about their purchase.

For example, students experience satisfaction or dissatisfaction after purchase the identified notebook. If they have positive experience with the notebook, they
experience satisfaction and vice versa.

(a) Post-purchase Satisfaction
Satisfaction is a function of the closeness between expectations and the product's perceived performance. If performance falls short of expectations, the consumer is disappointed; if it meets expectations, the consumer is satisfied; if it exceeds expectations, the consumer is delighted. These feelings make a difference in whether the customer buys the product again
and talks favourably or unfavourably about it to others.

(b) Post-purchase Actions
Satisfied consumers more likely to purchase the product again and tend to say good things about the brand to others. Dissatisfied consumers may abandon or return the product. They may seek information that confirms its high value. They may take public action by complaining to the company, going to a lawyer, or complaining to other groups (such as business, private,
or government agencies).

Private actions include deciding to stop buying the product (exit option) or warning friends (voice option).

(c) Post-purchase Use And Disposal
Marketers should also monitor how buyers use and dispose of the product. One opportunity to increase frequency of product use occurs when consumers' perceptions of their usage differ from reality. Marketer needs to know how the consumer disposes of the product once it is used.

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