The customer decision making process

After understanding the factors that affect the customer’s buying process, it is necessary for the retailer to understand the manner in which customer makes a decision. This requires understanding consumer behavior.

Typically the need for a product or a service starts at the time when the need for that particular product or service is recognized. A need may be psychological or functional. Psychological needs are associated with personal gratification that the customer may get from purchasing or owning the product. A functional need on the other hand, is directly related to the function of the product. The next stage is where the consumer seeks information about the product and the place where he can make the purchase. The source of this information may be a magazine, newspaper, family, friends the Internet or the television. Any earlier experience of buying the product or the service also affects the decision to purchase. The process that a customer goes through while making a purchase decision is illustrated below:

Need recognized >>

Search for information >> Internet> Media- Print &AV> Family & Friends> Stores

Store visits>>

Evaluation of options >>

Purchase decision:

Depending on the criteria important to him, the consumer evaluates the various options available and narrows down the choice to a few stores where he may make the purchase. He may also visit couple of stores before making a decision to buy. A buying decision is then made. Thus, the steps involved in the consumer decision making process are:

Stage1: Identification of a Need for the Product or Service

This arises when the consumer becomes aware of his need for a particular product or service. Typically, a consumer may realize that he needs a product when the current product he is using does not met his expectations, or he is about to exhaust the stock that he has of a particular product or when he sees a product or an advertisement for the same and feels the need to purchase the same.

Stage 2: Search for Information:

The second step involves gathering information on how to solve the problem. This search may be internal (from memory), or external (friends, family, published sources salespersons the internet, etc). The extent to which the consume needs to search for information depends on his current information levels and the perceived value of the additional information. If the consumer recalls past information from memory or past experiences, ten it is termed as internal information search. The process of seeking information from the external environment is termed as external search for information. This may be from a marketing source (advertisements, packaging, salesperson, sales promotions, POPs, etc) or a non marketing source (personal experience, experiences of friends, consumer reports etc). Based on the information gathered, the consumer arrives at an evoked set or a consideration set of products and services that he may choose from.

Stage 3: Evaluating Alternatives

These are the evaluative criteria consumers use to consider different options. This would vary from person to person and may be influenced by the situation. It also depends on the product to be purchased, the occasion for purchase and the buying environment

Stage 4: The purchase Decision:

At this stage, the decision is made first, whether to buy or not. It is possible to get close to a purchase, but abort the decision to buy for a number of reasons, such as being declined for financing getting cold feet a stock-out or other reasons. The next factor has to do with in store influences. Numerous displays in a store may cause a person to change his/her mind while in the store or perhaps a sales clerk may convince him to change brands or even the mount h planned to spend. Typically, consumers are influenced by various factors in determining the products or services that they finally select.

  • s.jeyalakshmi

    retail notes for shopping decision process