Leg 2 from Lisbon to Cape Town. Theme 1: Segmentation Consumer Markets. Part 4.
The theme of today is Understanding the Consumer Buying Process. As you can see, we have to sail fast in order to finish these topics which are particularly extensive. Again I have based my writings on this theme 1 in the book of Professor Kotler and Keller, Marketing Management 15th Edition.
Marketing scholars have developed a “stage model” of the process of the decision buying process. The consumer typically passes through five stages:
- Problem recognition,
- Information search,
- Evaluation of alternatives,
- Purchase decision, and
- Post-purchase behavior.
Clearly, the buying process starts long before the actual purchase and has consequences long afterward. Consumers don’t always pass through all five stages—they may skip or reverse some.
1. Problem Recognition
The buying process starts when the buyer recognizes a problem or need triggered by internal or external stimuli. With an internal stimulus, one of the person’s normal needs—hunger, thirst— rises to a threshold level and becomes a drive. A need can also be aroused by an external stimulus. A person may admire a friend’s new car or see a television ad for a Hawaiian vacation, which inspires thoughts about the possibility of making a purchase.
Marketers need to identify the circumstances that trigger a particular need by gathering information from a number of consumers. They can then develop marketing strategies that spark consumer interest. Particularly for discretionary purchases such as luxury goods, vacation packages, and entertainment options, marketers may need to increase consumer motivation so a potential purchase gets serious consideration.
2. Information Search
Surprisingly, consumers often search for limited amounts of information. We can distinguish between two levels of engagement in the search. The milder search state is called heightened attention. At this level, a person simply becomes more receptive to information about a product. At the next level, the person may enter an active information search: looking for reading the material, phoning friends, going online, and visiting stores to learn about the product.
Major information sources to which consumers will turn fall into four groups:
- Personal. Family, friends, neighbors, acquaintances
- Commercial. Advertising, Web sites, salespersons, dealers, packaging, displays
- Public. Mass media, consumer-rating organizations
- Experiential. Handling, examining, using the product
The relative amount and influence of these sources vary with the product category and the buyer’s characteristics. Each source performs a different function in influencing the buying decision. Commercial sources normally perform an information function, whereas personal sources perform a legitimizing or evaluation function. For example, physicians often learn of new drugs from commercial sources but turn to other doctors for evaluations. Sometimes you are biased by your friends or family advice, and other times you get information from Twitter.
3. Evaluation of Alternatives
How does the consumer process competitive brand information and make a final value judgment? No single process is used by all consumers, or by one consumer in all buying situations. There are several processes, and the most current models see the consumer forming judgments largely on a conscious and rational basis. Some basic concepts will help us understand consumer evaluation processes: First, the consumer is trying to satisfy a need. Second, the consumer is looking for certain benefits from the product solution. Third, the consumer sees each product as a bundle of attributes with varying abilities to deliver the benefits. The attributes of interest to buyers vary by product—for example:
- Hotels— Location, cleanliness, atmosphere, price
- Mouthwash— Color, effectiveness, germ-killing capacity, taste/flavor, price
- Tires— Safety, tread life, ride quality, price
- Coffee shop— Location, convenience, diversity of coffee options and flavors, price
Consumers will pay the most attention to attributes that deliver the sought-after benefits.We can often segment the market for a product according to attributes and benefits important to different consumer groups. The consumer arrives at attitudes toward various brands through an attribute evaluation procedure, developing a set of beliefs about where each brand stands on each attribute. The expectancy-value model of attitude formation helps consumers evaluate products and services by combining their brand beliefs—the positives and negatives—according to importance.
4. Purchase Decision
In the evaluation stage, the consumer forms preferences among the brands in the choice set and may also form an intention to buy the most preferred brand. In executing a purchase intention, the consumer may make up to five sub decisions: The brand, the dealer, the quantity, the timing, and payment method. Even if consumers form brand evaluations, two general factors can intervene between the purchase intention and the purchase decision. The first factor is the attitudes of others. The influence of another person’s attitude depends on two things: (1) the intensity of the other person’s negative attitude toward our preferred alternative and (2) our motivation to comply with the other person’s wishes. The more intense the other person’s negativism and the closer he or she is to us, the more we will adjust our purchase intention. Related to the attitudes of others is the role played by infomediaries’ evaluations: for example, Consumer Reports, which provides unbiased expert reviews of all types of products and services; the magazine Time Out which provides consumer-based ratings of restaurants, events and touristic spots in several cities all over the world. Zagat is another example of restaurant reviews, meanwhile the customer reviews of books and music on sites as Amazon.com; and the increasing number of chat rooms, bulletin boards, blogs, and so on where people discuss products, services, and companies.
The second factor is unanticipated situational factors that may erupt to change the purchase intention. Preferences and even purchase intentions are not completely reliable predictors of purchase behavior. A consumer’s decision to modify, postpone, or avoid a purchase decision is heavily influenced by one or more types of perceived risk:
- Functional risk—The product does not perform 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 in front of 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.
The degree of perceived risk varies with the amount of money at stake, the amount of attribute uncertainty, and the level of consumer self-confidence. Consumers develop routines for reducing the uncertainty and negative consequences of risk, such as avoiding decisions, gathering information from friends, and developing preferences for national brand names and warranties.
5. Postpurchase Behavior
After the purchase, the consumer might experience dissonance from noticing certain disquieting features or hearing favorable things about other brands and will be alert to information that supports his or her decision. Marketing communications should supply beliefs and evaluations that reinforce the consumer’s choice and help him or her, feel good about the brand. The marketer’s job, therefore, doesn’t end with the purchase. Marketers must monitor postpurchase satisfaction, postpurchase actions, and postpurchase product uses and disposal.
Note: All the pictures shown on this blog do not belong to me. I do not own any of the lovely photos posted unless otherwise stated.
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