Consumer Decision Making - Research Paper Example

Consumer Decision Making Abstract This paper conducts an exploratory study of reasons why consumers delay making decisions. A research proposal to survey on purchases costing more than £100 reveals five causes of delay. Three of these - task avoidance and unpleasantness, time pressure, and uncertainty have been identified in other decision contexts, while causes related to the difficulty of selecting the best brand and perceived risk of product performance are more specific to consumer decision making. We will discuss the difficulty of selection and time pressure are the most important causes of consumer delay and task avoidance the least important. Correlations between delay causes and time spent in each stage of the consumer decision making process provide tentative evidence that the different delay causes tend to prolong decision time in particular stages. Consumer Decision Making Purpose Rare is the individual who never delays making decisions and taking actions. Delay and procrastination can improve decision making (Janis and Mann, 1977, 17) and be an adaptive reaction to a decision (Taylor, 1979, 43), hut excessive delay can become maladaptive, prolonging a decision so long that it is finally made at the last minute in a slipshod fashion (Lay, 1986, 475, 1988, 203; Solomon and Rothblum, 1984, 505), perhaps so late that the situation requiring the decision becomes moot (Simmons, Klein, and Thornton, 1974, 89). The causes and effects of decision delay should be of interest whenever decision making and actions are studied. To quote Hogarth, Michaud, and Mery (1980): "whereas understanding how people make decisions is important, it is also necessary to understand why people delay making decisions . . . " (pg. 112). Research Question For this research study we have the following research question: What are the important causes that delay the consumer decision for major purchases? Literature Review Decision and task delay have been investigated in a number of contexts, including seeking help for a distressing personal problem (Amato and Bradshaw, 1985, 22), donating a kidney (Simmons, Klein, and Thornton, 1973, 111), urban development and business relocation (Hogarth, Michaud, and Mery, 1980, 97), writing undergraduate term papers (Lay, 1988; Solomon and Rothblum, 1984, 507), and completing personal projects (Lay, 1986) or small, everyday tasks (Milgram, Sroloff, and Rosenbaum, 1988, 201). More general typologies of "non-decisions" have also been proposed (Corbin, 1980, 55), including refusal, inattention, and delay. However, little attention has been given to delay in consumer decision making. Decision and reaction time have been studied in experimental contexts, but a general study of reasons why consumers delay decisions has not been attempted. The purpose of this paper is to investigate, in an exploratory fashion, the causes of consumer decision delay. Past research on delay has revealed that causes which may generalize to other contexts often exist alongside context-specific causes. We propose that this may apply to consumer decision making. This paper next discusses causes of delay which have been identified in other contexts and propose aspects of consumer decision making which may create context-specific causes. We then describe a study designed to identify the structure of these causes, examine their different importance in causing delay in consumer decision making, and investigate their relationship to elapsed decision times in different stages of the consumer decision making process. Causes of Decision Delay and Procrastination Causes from other contexts Several investigators have found that delay and procrastination can be caused by a person's tendency to avoid an unpleasant task or decision. Milgram, Sroloff, and Rosenbaum (1988, 210) find high correlations between procrastination in everyday tasks and dysphoric affect ("the negative emotional response associated with doing a particular task"), as well as covert negativism ("an avoidant reaction" towards "demands imposed on us by resented authority figures"). Amato and Bradshaw (1985, 28) identify "fear and stigma" and "problem avoidance and denial" as two reasons for procrastination in seeking help for a personal problem (derived with clustering procedures, these causes may not be orthogonal). Hogarth, Michaud, and Mery (1980, 99) find that decision makers may delay when psychological regret (the anticipation of adverse consequences from future decisions) causes them to fear "possible accusations of irresponsibility, from others or even themselves." Solomon and Rothblum (1984, p. 503) find that procrastination in writing term papers can be caused by two general factors relating to negative reactions to the task: (a) fear of failure, involving both one's own and other people's standards, as well as lack of self-confidence, and (b) aversion to the task and laziness. Lay (1988), alsoin the term paper context, finds that pessimistic procrastinators are likely to develop negative reactions by anticipating problems completing this task, such as suffering from writer's block, or misplacing notes, and may also develop these reactions from overestimating the amount of time necessary to complete the task. Janis and Mann (1977, 19) discuss how defensive procrastination is one form of defensive avoidance, used by the decision maker as "a means of coping with the painful stresses of decison making . . . "(pg. 6). They contrast this strategy with "vigilant information processing" which satisfies "ideal procedural criteria" for decision making (pgs. 11-12). Given the ubiquity of tliis cause across many different tasks, we would also expect it to emerge as a cause of delay in a consumer context. Hogarth, Michaud, and Mery (1980) find that decision delay also can be caused by three types of uncertainty: "(a) lack of knowledge about events that could affect outcomes, (b) ambiguity concerning the consequences of actions, . . . and (c) procedural uncertainty, concerning means to handle and process the decision, e.g. specifying relevant uncertainties, what information to seek and where, how to invent alternatives and assess consequences, etc." (pg. 110). This source of delay may also affect consumer decision making, since consumers must determine products' attributes as well as which attributes are important to them, and other people may need to approve the decision. Amato and Bradshaw (1985, 30) find that "negative helper evaluation" may prompt decision delay when seeking help for a distressing personal problem. This cause may be quite relevant to a consumer context, since consumers seeking help in decision making often turn to friends or salespeople. Amato and Bradshaw (1985, 31) find that lack of available time can cause decision delay, while Lay (1988) finds that perceptions of how much time a task will take can also lead to delay, and that procrastinators perceive that they spend less than adequate time on projects (Lay, 1986). Time pressure and availability should also cause delay in consumer decision making, since other tasks and decisions compete for time. Delay causes peculiar to consumer decision making. Some aspects of consumer decision making may create delay reasons not usually found in other contents. One reason which may arise in consumer contents is the difficulty of deciding which alternative to choose from among a set of brands or model:. Unlike many other types of decisions or tasks, which require either a yes/no decision or simply getting on with the matter (such as writing a term paper), consumer decisions require comparing a set of alternatives which may be quite similar. This comparison involves assembling the set of considered alternatives, identifying the relevant attributes, comparing the alternatives on these attributes, and determining which is most preferred; these tasks comprise the information search and evaluation stages of the consumer decision making process. Accordingly, we conjecture that difficulty in deciding which alternative to choose may be a delay cause peculiar to the consumer decision making context. Many aids in consumer decision making, such as consumer magazines and personal computer software which allows consumers to readily compare data on different alternatives in a product category, seem to be directed at aiding consumers in this stage of decision making. Delay and stages of the consumer decision making process. Four of the stages in the consumer decision making; process are relevant to the study of delay in these decisions: 1) identify the consumer need, 2) search for information, 3) evaluate alternatives, and 4) purchase. One purpose of the present study is to investigate how each reason for delay is related to the amount of time a consumer takes to complete each stage in the decision making process. Due to the exploratory nature of this research, we will not hypothesize specific relationships between causes of delay and decision time spent in each phase; significant relationships found in the present work will provide areas for future investigation. Research Methods Research Design To examine the causes of consumer decision delay, there will be a survey design in order to ask consumers why they delayed making a major purchase (a product costing at least £100) and how much time they took to complete various stages of the decision making process. Plan My research plan is divided into 3 months. During first month I will collect preliminary information, sample selection and I will prepare survey questions, in second month the survey will be conducted and the responses will collect from the participants, in last month there will be analysis and interpretation of the survey responses, and the report will be finalize. Sample Fifty students will draw from classes in two graduate schools of business in Edinburgh, who will complete the survey. This sample will not proposed to be representative of all consumers, but it will provide insights into consumer delay for a well-educated segment that makes a considerable number of high involvement purchases, as suggested by the variety of product categories mentioned in the surveys. Subjects will be asked to describe purchases which they were aware of delaying. Although this limits the scope of the study to conscious reasons for delay, it might be difficult to ask consumers to give delay reasons and delay times for purchases which they may feel has been made promptly. Delay reasons for such purchases may show a different structure than for the purchases reported here. Reasons which have already been identified will select from a review of the literature. Pilot Study Additional reasons will be selected using a small pilot study, where six consumers will be asked in a written survey to report reasons why they delay purchases. Respondents will be asked to indicate "how important each reason was in causing you to defer the [purchase] decision" by marking a Likert scale with the response intervals (1) no influence, (2) a minor influence, (3) a moderate influence, (4) an important influence, (5) a very important influence, and (6) an extremely important influence. Respondents will also indicate how much total time (not just time spent on the decision) elapse (1) after they recognize the consumer need but before they begin information search, (2) during information search and evaluation, and (3) after choosing which brand to purchase but before actual purchase (description of each phase on the survey is more extensive than the terms used here). Elapsed time between need identification and the onset of information search will be requested since this period, when the consumer wants the product but is distracted by other activities and has not yet acted to gather information, may form an important area of decision delay. Elapsed time for the information gathering and alternative evaluation phases were combined into a single question since the consumer specific delay cause, if found, was expected to affect elapsed time for both of these stages. Time between selecting an alternative and actual purchase again represents a period where the consumer is not active in decision making. Respondents will have the choice of providing elapsed time information in years, months, week?, days, hours, or minutes, and will be asked to indicate how many units of the most appropriate time had elapsed in each stage. This information will be subsequently re-expressed in weeks and used to create time variables for need recognition (abbreviated as NEED), search and evaluation (abbreviated as SEARCHEVAL), and purchase (abbreviated as PURCH). Since these elapsed times are based on retrospective reporting, they are subject to errors of memory that can affect such data. References Amato, Paul R. and Ruth Bradshaw (1985), " An Exploratory Study of People's Reasons for Delaying or Avoiding Helpseeking," AustralianPsychologist, 20 (March), 21-31. Corbin, Ruth M. "Decisions that Might Not Get Made," Cognitive Processes in Decision Making, Thomas Wallsten, ed., Lawrence Erlbaum. pgs. 47-67 Hogarth, Robin M., Claude Michaud, and Jean-Louis Mery (1980), "Decision Behavior in Urban Development: A Methodological Approach and Substantive Considerations," Acta Psychologica,45, 95-117. Janis, Irving L., and Leon Mami (1977), Decision Making: The Free Press, 17-20 Lay, Clarry H. (1986), "At Last, My Research Article on Procrastination," Journal of Research in Personality, 20, 474-95. Lay, Clarry H. (1988), "The Relationship of Procrastination and Optimism to Judgments of Time to Complete and Essay and Anticipation of Setbacks," Journal of Social Behavior and Personality, 3, 201-14. Milgram, Norman A., Barry Sroloff, and Michael Rosenbaum (1988), "The Procrastination of Everyday Life," Journal of Research in Personality, 11, 197-212. Simmons, Roberta G., Susan D. Klein, and Kermeth Thornton (1973), "The Family Member's Decision to be a Kidney Transplant Donor," Journal of Comparative Family Studies, A (Spring), 88-115. Solomon, Laura J., and Esther Rothblum (1984), "Academic Procrastination: Frequency and Cognitive-Behavioral Correlates," Journal of Counseling Psychology, 31, 503-9. Taylor, V/illiam L. (1979), "A Psychology of Decision Delay and Decision Avoidance," Psychology, 16 (Winter), 41-6. Read More