Page 126 - DMGT554_RETAIL_BUYING

Unit 9: Buying Decisions

In general, there are three ways of analysing consumer buying decisions. They are: Notes
 Economic models: These models are largely quantitative and are based on the assumptions
of rationality and near perfect knowledge. The consumer is seen to maximize their utility.

 Psychological models: These models concentrate on psychological and cognitive processes
such as motivation and need recognition. They are qualitative rather than quantitative
and build on sociological factors like cultural influences and family influences.
 Consumer behaviour models: These are practical models used by marketers. They typically
blend both economic and psychological models.

Did u know? Bernoulli developed the first formal explanation of consumer decision-
making. It was later extended by Von Neumann and Morgenstern and called the Utility
Theory.

!
Caution There are five stages which a consumer often goes through when he/she around
their Purchase. These stages also exist because of normal human psychology.

These five stages are:
1. Problem/Need Recognition: This is in general the first stage in which the consumer
recognizes that what essentially is the problem or need and, hence, accordingly a consumer
can identify the product or kind of product which would be required by the consumer.
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2. Information Search: In information search, the consumer searches about the product which
would satisfy the need which has been recognized by the consumer in the stage previous
to this one.
3. Evaluation of Alternatives: In this stage, the consumer evaluates the different alternatives
which the consumer comes across, when the consumer was searching for information.
Generally, in the information search the consumer comes across quite a few products and
thus now the consumer has to evaluate and understand which product would be properly
suited for the consumer.
4. Purchase: After the consumer has evaluated all the options and would be having the
intention to buy any product, there could be now only two things which might just change
the decision of the consumer of buying the product that is what the other peers of the
consumer think of the product and any unforeseen circumstances. Unforeseen circumstances
for example in this case could be financial losses which led to not buying of the product.
5. Post Purchase Behaviour: After the purchase the consumer might just go through post
purchase dissonance in which the consumer feels that buying the other product would be
better. But a company should really take care of it, taking care of post purchase dissonance
doesn’t only spread good words for the product but also increases the chance of frequent
repurchase.

Task Map the consumer buying process for a Car.

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