Retail management and consumer behavior, by thinker

thinker
Saturday 23 October 2010

SHOPPING PROCESS, 
DECISION MAKING 
PROCESS,
DIFFERENT TYPES OF 
DECISIONS.
- by RAVI PATEL
“thinker”

2
Welcome to the exciting
world of consumers!

Top 5 Factors in Apparel Retailing.
1. Latest Trends
2. High-Quality Products
3. Brand Names I want
4. Broad Selection
5. Full Range of Services
NOTE: Factors vary by category. Number 1 factor in home products
is broad selection.
Source: D. Warmath, “Get in the Game or Lose,” Advertising Age, August 25, 2008, p. 15.

Buying Behavior is the
decision processes (>>) and acts of people
involved in buying and using products.

Can you think of any moments
when you are NOT being a
Consumer ?

We Are Consumers 24*7! Why?
Consumer ?

Because:
Consumer ?

Because:
We are always consuming something.
Consumer ?

Because:
(like the clothes we are wearing or the bed we are sleeping on)
Consumer ?

Because:
We are sometimes planning future
consumption.
Consumer ?

Because:
We are sometimes planning future
consumption.
We are sometimes enjoying the memory of
past consumption.
Consumer ?

WHAT IS the PURPOSE OF
MARKETING?

MARKETING?
To Make Money

MARKETING?
To Make Money
or

MARKETING?
To Make Money
or
To Create a Satisfied Customer

MARKETING?
To Make Money
or
Focus on Consumers’ Needs Rather Than Products

MARKETING?
To Make Money
or
Identify Consumers’ Latent Needs

MARKETING?
To Make Money
or
Identify Consumers’ Latent Needs
Understand Consumer Behavior

Consumer Behavior means more than just
how a person buys products.
Some of the important issues that marketing
executives in business organizations face
include:
1. What do consumers think about our products
and those of our competitors?
2. What do they think of possible improvements in
our products?

3. How do they actually use our
products?
4. What are their attitudes toward our
products and our promotional efforts?
5. What they feel are their roles in the
family and society?
6. What are their hopes and dreams for
themselves and their families?

?
Psychological
  Memory
  Percep2on
  Mo2va2on
  Personality
Demographics
Environmental
•Family
•Culture
What is purchased?
When, Timing?
How much?
For what use?
Model of Consumer Behavior
Black box
Buyer’s
Responses

• why consumers make the purchases that
they make?
• what factors inﬂuence consumer
purchases?
• the changing factors in our society.
Need to understand:

• Buyers reactions to a firms marketing
strategy has a great impact on the firms
success.
• The marketing concept stresses that a firm
should create a Marketing Mix (MM) that
satisfies (gives utility to) customers, therefore
need to analyze the what, where, when and
how consumers buy.
• Marketers can better predict how consumers
will respond to marketing strategies.

Stages of the Consumer Buying
Process
Six Stages to the Consumer Buying Decision
Process (For complex decisions).Actual
purchasing is only one stage of the process.
Not all decision processes lead to a purchase.
All consumer decisions do not always include
all 6 stages, determined by the degree of
complexity...discussed next.

1of5
step
PROBLEM
RECOGNITION

2of5
stepINFORMATION
SEARCH

3of5
step
ALTERNATIVE
EVALUATION
&
SELECTION

4of5
step
OUTLET SELECTION
&
PURCHASE

5of5
stepPOST PURCHASE
PROCESS

over
allSaturday 23 October 2010

Types of Consumer Buying Behavior
Types of consumer buying behavior are determined by:
• Level of Involvement in purchase decision.
Importance and intensity of interest in a product in a
particular situation.
• Buyers level of involvement determines why he/she is
motivated to seek information about a certain
products and brands but virtually ignores others.

Low-purchase involvement High-purchase involvement
Nominal decision making Limited decision making Extended decision making
Problem recognition
Selective
Problem recognition
Generic
Problem recognition
Generic
Information search
Internal
Limited external
Information search
Limited internal
Information search
Internal
External
Alternative evaluation
Few attributes
Simple decision rules
Few alternatives
Alternative evaluation
Many attributes
Complex decision rules
Many alternatives
Purchase Purchase Purchase
Postpurchase
No dissonance
Limited evaluation
Postpurchase
No dissonance
Very limited evaluation
Postpurchase
Dissonance
Complex evaluation
Impulse buying- no conscious planning.

Outlet Image
Retailer Brands
Retail Advertising
Outlet Location and Size
Retail outlet selection involves a comparison of the
alternative outlets on consumer’s evaluative criteria:
Attributes Affecting Retail Outlet Selection

Categories that Effect the Consumer
Buying Decision Process
Personal
Psychological
Social

Personal
Psychological
Social
Unique to a particular
person. Demographic
Factors. Sex, Race, Age etc.
Who in the family is
responsible for the decision
making.
Young people purchase
things for different reasons
than older people.

Personal
Psychological
Social
Motives, Perception, Ability
and Knowledge, Ability and
Knowledge, Attitudes,
Personality, Lifestyles.

Personal
Psychological
Social
Opinion leaders, Roles and
Family Inﬂuences,
Reference Groups, Social
Class, Culture and Sub-
culture.

It can be regarded as
the mental processes
(cognitive process)
resulting in the selection
of a course of action
among several
alternatives. Every
decision making
process produces a ﬁnal
choice. The output can
be an action or an
opinion of choice.
Decision
making

Problem Analysis vs. Decision Making
It's important to differentiate between problem
analysis and decision making. The concepts
are completely separate from one another.
Problem analysis must be done ﬁrst, then the
information gathered in that process may be
used towards decision making.

Problem Analysis
• Analyze performance, what should the results be against
what they actually are?
• Problems are merely deviations from performance
standards.
• Problem must be precisely identiﬁed and described.
• Problems are caused by some change from a distinctive
feature.
• Something can always be used to distinguish between what
has and hasn't been effected by a cause.
• Causes to problems can be deducted from relevant
changes found in analyzing the problem.
• Most likely cause to a problem is the one that exactly
explains all the facts.

Decision Making
• Objectives must ﬁrst be established.
• Objectives must be classiﬁed and placed in order of
importance.
• Alternative actions must be developed.
• The alternative must be evaluated against all the
objectives.
• The alternative that is able to achieve all the objectives is
the tentative decision.
• The tentative decision is evaluated for more possible
consequences.
• The decisive actions are taken, and additional actions are
taken to prevent any adverse consequences from
becoming problems and starting both systems (problem
analysis and decision making) all over again.

Consumer behavior is inﬂuenced
by the circumstances surrounding
the purchase of a product.
Social surroundings
Physical surroundings
Temporal effects
Purchase task
Situational Inﬂuences

Consumer Behavior– you are
what you buy…

The only way to know How
customers see your business is
to look at through their eyes.
4
Marketing Psychology & C.B.
is

We perceive our environment
through our senses
We respond to stimuli
Those responses are our
behavior
Perception is everything
Half Empty
Half Filled

Consumers’ ﬁnal purchase activity is the
only aspect that is visible.

“The consumer has
become a totem pole
around which a
multitude of actions
and ideologies are
dancing”.

Retail management and consumer behavior, by thinker

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