Dynamics of Decision Making - Essay Example

Consumer Behavior Table of Contents Consumer Behavior Table of Contents 2 Just Noticeable Difference 3 2. Reference Group 3 3. Online Shopping 4 4. Multi-Attribute Attitude Model 4 5. Family Life Cycle 5 6. Dynamics of Decision Making 6 8. Strategies to change attitudes 7 9. Opinion Leadership 7 10. Jump stating the Diffusion process 8 11. Projecting as Affluent Class Products 8 Reference 9 1. Just Noticeable Difference The sensory organs of a consumer are enthused by the stimulus. The minimum level of difference that would happen in the intensity of the two stimuli that a person can detect half of the time is known as ‘Just Noticeable Difference’. In simple terms this is the minimal perceptible difference between two situations or two products, as noticed by the customers. In the first instance there happened to be an increase in the diesel price. The bread manufacturer does not need to react to that situation as the consumers are not supposed to notice the difference in product or product pricing. This is consumers’ subliminal perception. In the second instance, the intensity of competition in the market has been changed. This can be noticeable but still it depends on the stimuli of the customers on how they would look at this. The loyal consumers of Tiptop may or may not notice the change but the other consumers are supposed to notice it more prominently. So Tiptop may have to introduce lesser price or product differentiation to survive the competition. In the third instance, consumers are more knowledgeable regarding the nutritious ingredients labeling. This demands a strong change in the product specifications as the stimulus is going to be stronger in this case. Tiptop have to go by the proper labeling procedure of nutritious value in their breads. Increase in such ingredients can be a good way to attract the well-informed consumers. 2. Reference Group A reference group is a group of people which can influence and motivate one individual in changing his or her attitude and behavior. The reference group can have two functions; normative and comparative. A normative function sets and imposes specific standards for an individual. A comparative function serves as a relative position against which an individual evaluates oneself and other people (Guzman, Montana & Sierra, n.d.). For an instance, a school boy would like to buy study books to prepare for an examination. His choice would be influenced by his elders at home, his seniors in school or a bunch of students who have topped in that examination. The first two reference groups are functioning based on normative function and the later one is based on the comparative function. 3. Online Shopping A consumer may think that while buying some products online, he has to pay less as there is no distribution cost attached to the pricing. This belief would surely have a positive attitude towards his intention to shop online. The belief can be changed after visiting an online shopping site and the person may think that direct traditional shopping can provide much more variety than the web shopping portals. In that case his belief would put a negative attitude towards his intention to web shopping. 4. Multi-Attribute Attitude Model The Fishbein multi attribute attitude model proposes that attitude towards a product or object is supported by a collective set of beliefs about the product’s features weighted by the assessment of the same. In Ideal point multi-attribute attitude model, consumers point out where they perceive the salient attributes of the products on an attribute scale. They have the rankings for ideal products and make choices based on that one. Less the difference between actual and ideal ranking, more favorable is the intention towards buying. Every attribute is of same importance in this model. Advantages: The product manufacturers get to know about the reasons why a specific product is liked or disliked by the consumers. The manufacturers have the idea about the preferable attributes, which are of more importance to the consumers. Three ways to change customer behaviors are as follows. Changing beliefs Changing the importance of the attributes Changing point for the attributes of an ideal product. 5. Family Life Cycle Families are the groups which provide emotional as well as social support to an individual. A child adopts certain characteristics by observing his own family. Some people become loyal to a particular product brand which his family has been using for long. The four stages of family life cycle are as follows. Young singles They have a good amount of disposable income to spend on cars, travel and entertainment. Young married They have high disposable income with moderate expenses. Parenthood They are quite family people now and have a good amount of family expenditure. Post parenthood Best possible financial stage and opportunity for travel is available. Changes within the family demographics are as follows. Today people are marrying at a later stage means that more people are in the young single stage. That means they have quite an amount of finance to buy cars and other entertainment stuffs. So the car and other entrainment product manufacturers can have a greater consumer base for their products. 6. Dynamics of Decision Making In today’s world, most wives are much educated and employed. So surely while deciding on the attributes of TV sets, the husband and wives would have more equal dominating power. The sex-role structure orientation would leave the women with more dominating power than the men in the family. The family life cycle would have an affect on the dynamics of decision making. In the young married stage the decision would be dominated equally by the wives and husbands. In the later stages husbands are supposed to be more dominated. A TV advertiser would could make an advertisement for a high end expensive TV to attract more men than women. 7. Advertisement a) If the consumers are predisposed, the one sided advertising message can be effective. While, in a market, where the people are well educated and critical and market is quite competitive, it is better to use two sided advertising message. b) Using humor can attract people more easily when the usage of the same has been appropriate. It can be effective while using for the advertisement of established as well as commonly purchased products. c) Sometimes people use reference groups in advertisement to let the consumers know what people are thinking about the product brand. This can influence people if used properly. 8. Strategies to change attitudes a) The council can make people change their beliefs by changing the outlook of public transportation. They may advertise using two sided message to let the people know advantage and disadvantages of public transportation. b) Bringing up certain examples where people have been benefited by using the public transportation can help an observer to relate oneself with the situation and learn from the experience. c) People may have cognitive dissonance for the transportation using their own private cars. Using those on TV may bring a positive attitude towards the public transportation. 9. Opinion Leadership As per the opinion leadership theory, an opinion leader is the person who is quite accustomed to media and advertisement. He tends to interpret the meaning of those advertisements to the lower end users of the same. An opinion leader, mostly, is an expertise in a particular field. Sometimes viewers are more inclined to get influenced by the opinion leaders as they believe that they know more than the consumers. In such a case companies use such leaders in the advertisements. 10. Jump stating the Diffusion process To jump start the diffusion process, it would be better to use mass media, sales people and opinion leaders. Almost everyone in the gaming industry has the access of the web world and they prefer to spend time with that. So internet marketing can be a good option. People would like to listen from the expert people in the respective field. So using them can be a good idea for marketing such technical products. 11. Projecting as Affluent Class Products Although the middle class has the larger contribution to the population, but still there are a good number of people who would like to buy the high end and high priced products. Surely selling products to the high niche means a good amount of profit by selling a small number of products. Apart from it, with the increase in credit facilities even the middle class people are now moved towards having a lifestyle which they used to dream of. Even people are now more inclined to float their status to the society and the easy way is to get access to those high end products. Marketers, so, prefer to project their products as part of the affluent class. Surely the online shopping has gained its pace in recent days. Some people would like to buy from the websites than going out for shopping. In future the market is going to get bigger as technology is going to improve day by day. Surely the companies must start tapping the market from the very beginning. Reference Guzman, F., Montana, J. & Sierra, V. Reference Group Influence. “Reference Group Influence”.7 February 2010. < http://marketing.byu.edu >. Read More