How Consumers Make Choices - Essay Example

? Businesses can analyze how consumers make choices and can use this to create successful marketing strategies for the goods they want to sell. [Author] [Institution] Introduction Businesses form marketing strategies in order to reach their targeted customers for the goods that they want to sell. Marketing strategies have the basic aim of reaching the customer and convincing him to buy the product. For many of the businesses, consumer behaviors and decisions are the sole factor on which successful marketing strategies are made (Lantos, 2010, p. 163); however this is not always true. At many times, it has been observed that businesses believe in many other important factors other than consumer behavior to create successful strategies, such as innovative products. Both the perspectives can be analyzed to conclude that whether consumer decisions and behaviors should influence the marketing strategies or not. Consumer buying decisions may be used by businesses to create successful marketing strategies, but at the same time these evaluations may result in risks and problems for the businesses. This report analyses the arguments provided by experts saying that consumer decisions and behaviors should be considered because they give an insight to the marketers about their potential buyers, while others argue it should not be considered as business marketing needs to be rather innovative; however there has not been any clear conclusion to the discussion as both aspects have their own positive and negative points. Many of the business analysts favorably suggest that consumer decisions should be evaluated, examined and analyzed to set successful marketing strategies. This is because the customers are the major assets of the business as they enhance the growth, sales and profits of the business (Cheverton, 2005, p. 125). When a product is made, the first focus of the marketing department is to examine the target customers, position the product in the market and then create the marketing mix for the product. For these steps, the main feature is to select the targeted customers and reach up to their demands and expectations. As the business industry is becoming more and more competitive by every passing day, it is becoming even important for the businesses to recognize the tastes and behaviors of their new and existing customers. The industry today is full of complex customers who are highly informed and have high expectations. If the business wants to have a successful future, it has to consider and analyze the consumer decision making behaviors and set their strategies according to that. Thus, it is the objective of the business’s marketing department to observe and understand the behavior of the consumers and design their product just as it attracts them (Zeithaml, 1988, p. 2). In order to keep track of the consumer demands and expectations, the business needs to allocate its resources in a way that they are able to spend a decent proportion of funds in evaluating the consumer tastes and decisions. Olson writes, for this, the business also needs highly technical tools through which they can research the market trends in lesser time and get efficient results. Business analysts suggest that it is vital for the business to spend its money, time, resources and efforts in focusing and fulfilling consumer demands because without that, the business cannot form successful marketing strategies (Olson, 2010, p. 135). On the other hand, arguments against this fact suggest that as the consumers have become more complex, their demands have increased. The businesses that evaluate and examine the consumer decisions must hire a separate team that will understand and analyze the psychological trends that move on in customers. The customers are now highly informed and thus the products that reach to them must be perfect according to what they expect. While this is an important aspect to consider, it is also undeniable that there are plenty of customers that are still unaware and simple. For these customers, high tech products or products with complex or new ingredients are not feasible as they are less likely to take risks with their choices (Sheth, 1995, p. 260). If this aspect is considered, analyzing the consumer decisions may put the businesses in trouble. The business marketing strategies will get more critical and complex for which employees with specialist knowledge must be hired. This would increase the budget for marketing of the business as well as increase the risk. The products that businesses sell are to a wide range of customers and so if one set of customers are analyzed, the others might be left out. Customer behaviors and decisions greatly vary due to their location and private characteristics; and this should not be forgotten. Business theorists favoring the claim suggest that even though the complexity of the consumer behaviors and decisions may cause trouble to the business, it is undoubtedly going to cause success in the long run. As they say ‘no pain no gain’; if the businesses want to reach out and fulfill the expectations of the consumers they must put in some extra efforts. Of the business marketing departments plan a higher budget for the marketing strategies, the businesses can increase their chances of reaching the customers and influencing their decisions by effective marketing (Reynolds, 2001, p. 5). Hiring experts to analyze customer behaviors and decision making trends, spending money over the enhanced marketing strategies such as product packaging, or giving more time to each product so that it can come out perfectly are ways in which the business can use the consumer decision making to create successful strategies. Consumer decisions should be analyzed as they show the businesses what the customers want expect and are looking for. Whether it will be the price that will influence their decision, the packaging or the brand name, and these will help the businesses to focus on the area which requires improvement or change. If the consumers feel that their expectations are being fulfilled time and time again, they will eventually feel satisfied and this would increase brand loyalty. Lantos writes that theorists that argue that consumer decisions should not be used to create marketing strategies say that the change in consumer tastes, behaviors and buying trends greatly impact the businesses negatively. This is because the human psychology says that tastes and behaviors change as time passes. As our society is rapidly developing and changing with newer enhancements and expectations, the consumer tastes also tend to change. If the business marketing strategies are set according to the buying decisions of the consumers, they will possibly be outdated or unsuccessful. New consumers evolve on regular basis and for them the existing marketing strategies may be unattractive. Moreover, for existing customers, they may become boring and repetitive for their changing tastes (Lantos, 2010, p. 66). This aspect will force the marketing department to be attentive towards special techniques for market research in order to aid the successful strategies. The business will need an ongoing source for examining and analyzing information on buying decisions for the success of the company. This process would increase the spending of the business as more research techniques would need to be applied on regular basis. These techniques include questionnaires, surveys, observations, interviews and feedback forms. Through these techniques the business can reach to the minds of their customers and ask them why they chose the product or why they didn’t (Olson, 2010, p. 76). These techniques require time and money, and yet accurate results are not expected. This is because no one can actually tell when a human mind is biased, attentive and loyal and when it is influenced. Moreover, as these trends tend to change on daily basis, the research methods will need to be carried out on regular basis increasing the time needed and money spent. The business will also need technological tools in order to reach to the customers through social and electronic media (Peter, 2007, p. 45). Many of those who favor the claim highlight that consumerism is an important aspect for any business and for that the business marketing strategies should be set according to the consumer buying decisions. When the business interacts with its customers and maintains a good customer service, the consumerism tends to increase as customers are encouraged to buy more of the business products. Theorists also argue that because of the vital advancements in technology, it has become easier to reach and interact with the customers (Shocker, 1991, p. 181). Marketers can now easily indulge with the consumers and find their preferences through the web communication medium. Also, many tools including visual and sound elements can be used in order to attract the target audience. With these mediums, the customers can be reached on an individual basis too which would give a better picture of what the consumer expects and considers before making his buying decision. In this way the marketers can enable a two way communication between them and their customers and make the most out of the information (Barone, 2000, p. 250). Technology has also enabled consumers to easily find out the best deals and compare the prices for extensive researching before they make their buying decision. Business can tend to ensure this and set their marketing strategies accordingly especially for online shopping. They could find out whether their target audience uses excessive online shopping or the traditional ways. Hence, technology has greatly enabled the marketers to know about their consumers and their buying decisions, according to which they can plan their strategies for a successful future growth (Ferrell, 2010, p. 154). In order to interact with the consumers, fulfill their demands, follow their buying decisions, and increasing consumerism for the business, marketers must utilize all techniques of communication to set the marketing strategies that suit the consumer behaviors (Mukherjee, 2002, p. 97). Hall says that theorists suggest that businesses should rather be innovative and creative than just fulfilling the existing demands of the consumers. Consumers demand what they have seen already and what they consider to be their need. However, innovation allows the businesses to innovate new technology products in the market which attract the consumers. An example is the touch screen phones released by Apple. These phones were not demanded or expected by the consumers but the company created a new product which caught the attention of the consumers as well as the competitors (Hall, 2007, p. 150). If businesses stick to the current behavior and demands of the consumers they will never be able to create new products. The businesses may need technological knowledge to think out of the box and create a new product. However, this involves a high risk factor too as there is no guarantee to how the consumers will respond to the new product. Many consumers do not like to try new products while many love trying new things, thus risk factor will be involved. But this shows that current consumer behavior should not be used to set marketing strategies (Cheverton, 2005, p. 36). However, it is true that the consumer buying decisions may be used by businesses to create successful marketing strategies. Even though it may consist of many risks and problems for the business, yet in reflection to the above discussion, it can be concluded that analyzing the consumer decisions, expectations and demands can help the business marketing department to develop strategies that are beneficial for the long term success of the business. Marketing strategies are useless if they are not made according to the expectations of the consumers, as they are the major assets of the business. The business thus needs to allocate its resources, increase consumerism, use technological advancements and take some risk in order to create successful marketing strategies. References Barone M. (2000). The Influence of Cause-Related Marketing on Consumer Choice: Does One Good Turn Deserve Another? Journal of the Academy of Marketing Science, 28(2), 248-262 Cheverton P. (2005). Key Marketing Skills: Strategies, Tools and Techniques for Marketing Success. USA: Kogan Page Publishers Ferrell O. (2010). Marketing Strategy. NY: Cengage Learning Hall D. (2007). Business Studies. India: Pearson Education India Lantos G. (2010). Consumer Behavior in Action: Real-Life Applications for Marketing Managers. NY: M.E. Sharpe Mukherjee S. (2002). Modern Economic Theory. India: New Age International Olson J. (2010). Consumer Behavior and Marketing Strategy. USA: McGraw-Hill Companies Peter J. (2007). Consumer Behavior. USA: McGraw-Hill Companies Reynolds T. (2001). Understanding Consumer Decision Making: The Means-End Approach to Marketing and Advertising Strategy. NY: Routledge Sheth J. (1995). Relationship Marketing in Consumer Markets: Antecedents and Consequences. Journal of the Academy of Marketing Science, 23(4), 255-271 Shocker A. (1991). Consideration Set Influences on Consumer Decision-Making and Choice: Issues, Models and Suggestions. Kluwer Academic Publishers, 181-197 Zeithaml V. (1988). Consumer Perceptions of Price, Quality, and Value: A means-end model and synthesis of evidence. 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