(16 minute read)

A BRIEF RECAP

I am exploring the various stages of the Consumer Decision Making Process. The early stages are moving the consumer from ‘intend to buy’ towards buying or decision making, turning the consumer from passive to active.

Decision Making is the process of attempting to respond to a problem and attempting to solve it. Buying is seen as the actual response enacted through purchase.

BUYING

Decision making process results in buying. Purchase is the tangible response to the problem. The act of purchase or buying connects pre- and post-purchase behaviours. It is dependent on context of time and space (to be explored in detail later).

IMPULSE BUYING

Not all buying is planned. A significant part of buying is Impulse Buying, also referred to as unplanned purchase. Impulse buying is to some extent dependent on prior understanding and involvement and can include different stages of involvement.

Types of Impulse Buying are:

  • Pure impulse – sudden buying because of novelty or escapism.
  • Reminder impulse – where an item is suddenly ‘remembered’ as being wanted.
  • Suggestion impulse buying – going through a very rapid spur of the moment evaluation without prior knowledge.
  • Planned impulse buying – where consumer intends to buy but has not decided what to buy.

A study of consumers in an airport shopping environment revealed the following types of ‘effects’ which resulted in a range of purchase behaviours.

NEW PRODUCT BUYING

It is critically important for marketers to introduce new products into the market. New product development and introduction is an integral part of the Product Life Cycle (PLC). A product goes through different life stages:

  • Introduction
  • Growth
  • Maturity
  • Decline / Rejuvenate

This can be mapped to different types of consumer behaviours in terms of how quickly or slowly consumers are willing to adapt innovation or alternatively how quickly any kind of innovation diffuses itself in the marketplace. It is often known as the Diffusion-Adoption of Innovation Model.

FOUNDATION THEORY

Foundation Theory is used to explain Diffusion-Adoption of Innovations – the processes of how innovation spreads through a society and how individuals ‘adopt’ to new innovations.

Diffusion refers to how the innovation is communicated and distributed through society over time. It is a ‘macro’ concept concerned with aggregated adopted behaviour.

An innovation’ is anything that is perceived as being new in the marketplace. Innovations can be continuous, dynamically continuous, and disruptive. The notion of innovation primarily relates to technology but can also include other types of products. It is reinforced through advertising and marketing communications.

The Ehrenberg ATR Model is often used in advertising to guide how the marketing of new products should be supported by advertising while being introduced into the marketplace.

ADOPTER CATEGORIES

People adopt innovations at different rates. Some of this is linked to their appetite for risk.

  • Innovators: eager to try new ideas
  • Early adopters: include opinion leaders, influencers
  • Early majority: those open to ideas in mass media
  • Late majority: subject to peer pressure
  • Laggards: bound by tradition, averse to change
  • Non-adopters: anti-adoptive mentality

INFLUENCERS

Influencers are Opinion Formers, Opinion Leaders, and Opinion Shapers.

  • Opinion Formers:
    • Real Opinion Formers: trusted intermediaries, celebrities, people with a common touch.
    • Simulated Opinion Formers: media, TV shows.
  • Opinion Leaders: product or category specific
    • Real Opinion Leaders: knowledgeable specialists.
    • Simulated Opinion Leaders: indirect methods.
  • Market Mavens: Gatekeepers and infomediaries

ADOPTION IN TECH MARKETS

Technology Acceptance Model (TAM): extends traditional adoption theory by linking it to attitude models such as Theory of Reasoned Action. Considers two key factors:

  • Perceived Usefulness – how users perceive the technology will improve their efficiency and performance.
  • Perceived Ease-of-Use – how users perceive the new technology will be easy to user and not require too much effort to learn and adopt.

PURCHASING

Purchasing is the enactment of a consumption situation which may or may not include a monetary or non-monetary transaction. It brings together a buyer, a seller, a product or service. It also includes many other tangible and intangible factors including motivations, reasons, social, cultural, and physical environment, and situational contexts and orientations. It involves the influence of decision making units and structures.

SITUATIONAL FACTORS

  • Dependent upon situations in which the product is used:
    • Utilitarian and functional needs
    • Rational
    • Emotional and psychological needs
  • Also includes social and physical and psychological surroundings
    • Crowds
  • Understanding the ‘problem solving’ context – the purpose and the buying situation.
  • Allows for market segmentation, targeting, and positioning.

USAGE FACTORS

  • Understanding how a product is used and consumed
  • Understanding who people are when they buy what they buy

DECISION MAKING ROLES AND DECISION MAKING UNIT

  • Initiator – person who instigates the buying decision process
  • Influencer – person who exercises the most influence – can change according to culture and family unit
  • Decider – final decision maker
  • Buyer – usually the person who pays for the purchase
  • User – person who uses and consumes the product
    • Roles can be interdependent and overlapping
    • Used for market segmentation and targeting

FAMILY AS DECISION-MAKING UNIT (DMU)

  • Family as “mini-company”
    • Extended family vs. nuclear family
  • Family household
    • Shared residence and common housekeeping arrangement (EU definition)
  • Family decision-making like business meeting
    • Different members, different priorities => lobbying
    • Power struggles that rival corporate intrigues
  • Consensual purchase decision
    • Desired purchase agreed, but differences in how to buy
  • Accommodative purchase decision
    • No agreement on purchase that satisfies minimum expectations

TIME PRESSURE

  • Economic Time: time as a resource – making time, spending time, wasting time, time pressures, time rich, time poor
    • Culture as a temporal dimension
  • Psychological Time: time as a flow, as a fluid resource or time as a material resource that needs to be planned and allocated
  • Social dimension: me-time, family time
  • Temporal dimension: past, present, future
  • Planning orientation: flow, continuous, discrete
  • Polychronic: single focus or multi-tasking

TIME MANAGEMENT

  • TIME:
  • Waiting times and queuing times
  • Consumer receptivity to ads – leisure time, ‘time to kill’
  • Store management techniques:
    • Queue management
    • Entertaining customers, capturing feedback
    • Till display
    • Location of mirrors, fitting rooms, aisle displays
    • Re-routing consumers
    • Self-scanning and bagging

SHOPPING ORIENTATION

  • SHOPPING MOTIVATIONS:
    • Utilitarian, functional, or hedonic, pleasurable
    • Tangible or intangible purchases
    • Hedonic shopping motivations:
      • Adventure
      • Social
      • Gratification
      • Therapeutic
      • Catharsis
      • Role playing
      • Ideas
      • Values

SHOPPER TYPES

  • Economic shopper
  • Personalised shopper
  • Ethical shopper
  • Recreational shopper
  • Social shopper
  • Apathetic shopper
  • Status-conscious shopper
  • Hate-to-shop shopper
  • Thrill seeking shopper

PURCHASING ENVIRONMENT

  • Growth of shopping as entertainment, recreation, and leisure activity.
  • Shopping environments as entertainment and leisure spaces – treated as visitor attractions.
  • Both physical and online shopping environments.
  • Draws from environmental and social psychology to investigate the effects of physical and online environments and design elements on consumer shopping behaviour.
  • Social and physical surroundings impact purchasing behaviours.

RETAILING

  • Positioning:
    • Store location
    • Operations
    • Product selection and range
    • Advertising and in-store promotions
  • Operations:
    • Layout, design, access, and flow
    • Lighting, heating, ventilation, ambient temperature
    • Music, sound, smells
    • Signage, amenities, facilities, uniform
    • Printed material
    • Staff, staffing, skills, services
    • Extra services
    • In-store promotions, special events
  • Point of Purchase Stimuli:
    • Aisle layout and shelf spacing
    • Product displays
    • In-store entertainment
    • Interactive shopping trolleys
    • Innovative promotions and packaging
    • Demos, sampling, tasting
  • Sales Interaction:
    • Upselling
    • Loyalty cards
    • Market research and feedback capture

ONLINE BUYING

The advancement in e-commerce technologies and the explosion in online shopping is changing the nature of purchasing-buying actions.

Online shopping environments disrupt many conventional thinking about buying decision making, new product adoption, impulse buying etc. They also disrupt conventional thinking about purchasing context factors such as time, retail environment etc. Websites and web portals are now the new shopping environment and the online shopping experiences collapses the many gaps in the decision making process and makes it one seamless activity.

PROS AND CONS OF E-COMMERCE

To summarise:

  • Buying or purchasing is the active, tangible response to the process of finding a solution to the problem.
  • Buying behaviours differ in impulse and new product buying.
  • The actual buying or purchasing context is influenced by the interplay of a number of factors including the buying situation, the usage context, time, decision making roles and structures, and the shopping orientation of the buyer-consumer.
  • The purchasing environment – physical and virtual – can be a significant factor in buying and draws from theoretical perspectives in environmental psychology and design.
  • Online shopping and e-commerce are radicalising the way people buy.

REFLECTIONS: CHALLENGING YOUR THINKING

  • Reflect on your own behaviours as consumers when you engage in impulse buying.
  • Examine your attitudes towards adopting a new product as a consumer.
  • Examine your everyday objects of consumption and analyse how different elements of purchasing context can influence buying behaviour.
  • Reflect upon your own orientations and motives as a shopper. Why exactly do you feel the need to engage in consumption?
  • Examine the impact of shopping environments both physical and virtual and how they influence your consumer behaviour.