An Influence of Positive Effect on Decision Making in Complex Situations - Case Study Example

CONSUMER DECISION MAKING PROCESS By Students Name Course Professor University State Date Introduction A consumer refers to a person who buys goods and services from a market for personal use. Every marketer wishes to get into a consumer's mind and figure out how a customer makes his or her decisions before making a purchase. Markets always strive to understand how they can make consumer’s purchase their products or services. Buying a product is the only visible procedure of a complex decision-making process that is created by a consumer for every purchase decision he or she makes (Michel, 1998). The biggest question is based on what takes place before and after the acquisition or the kind of factors that influences the product purchased choice. During a buying decision-making process, a consumer undergoes numerous stages as shown below. Need ↓ Information Gathering/Search ↓ Evaluation of Alternatives ↓ Purchase of Product/Service ↓ Post Purchase Evaluation Consumers apply the steps shown above to help them purchase many products and make relevant decisions before acquiring the product. For instance, gold is an increasingly valued and cherished product. Gold has been a medium of exchange a feature that has made it be valued all through the history. Today the value of this commodity is carefully watched in the world market, and there is an active trade for its investment value. The aim of this paper is to focus on Consumer Buying Decision Process and the stages involved as far as buying gold is concerned. Need recognition Need acknowledgment is the first step and most essential stride in the purchasing procedure. This infers that in case the need is not present there is no purchase that can happen. This is a crucial step in the purchasing process because it gives a customer a chance to clearly review what he or she wants and which satisfies the recognized need in the best way possible. This type of acknowledgment happens when a slag exists between the shopper's genuine circumstance and the thought and sought one. For example, gold is taken as a materialistic symbol. Thus, one may choose to buy it as an image of riches, the wellspring of happiness and fortunes in a man's life. Additionally, gold is likewise considered as a decent venture. It increases in quality and is considered as protected and secure venture that has a capacity of diminishing portfolio risk. It is important to note that it is not all needs that end up being a buying behavior. It is required that the existing lag between the actual and ideal situation to be quite significant. However, the way of obtaining the ideal situation, needs must be perceived as acceptable by the consumer on the basis of the level of importance he or she attributes to the need (Jillian, and Geoffrey, 2001). The need recognition by a consumer can be instigated diverse ways. These can be classified as follows Internal stimuli; this alludes to mental needs or the individual observation that a shopper feels, for example, status. On the other hand, it opposes the external stimuli such as the sight of a Indian wedding gold as part of the dowry or the word of mouth regarding gold status uplift .These needs can be named: Functional needs; this sort of need is identified with a specific item usefulness. For example, quality and a lot of gold that reacts to the need of obtaining a wealth status in the public. Social needs; this need emanates from an integration need within the social environment or either for social recognition. For example, again buying gold in bulk for social status. Need for change; the need originates from a consumer desire to have a change. This may lead to buying gold as a new way of investment to have a change from the usual and ordinary investment ways. Information search Once the consumer identifies the need what follows is a consumer to seek information on possible solutions to the problem. Information search is all about getting all relevant information regarding a product. It is a crucial step n the decision making process because the customer enlighten himself or herself with the product functionality, quality among others. The complexity of choices, in this case, it acts as the guiding features on the amount of information a consumer should search for, but the level of involvement is a factor to put into consideration as well. Buying households goods requires little information, but a commodity like gold is highly involving (Dan Ariely, 2000). The consumer seeks to consult his or her opinion guidance towards the choice and decision-making procedure with the following aspects; Internal information; at this stage this information already existing in the consumers mind and result from past experiences he or she had a product (Gold) and the brand opinion. It is important to note that this kind of information is enough for the purchase of a daily product that a consumer is conversant with. However, in case of a critical purchase with an increased level of uncertainty, for instance, Gold where a consumer lacks enough information, he or she should turn to other sources. External information; this refers to a form information regarding a product that is obtained from friends relatives, as well as other consumers reviews. Some other credible sources are the official business sources. During this process, the buyer pays increased attention towards internal information and that from relatives, and other consumers compared to the official business information sources regarding Gold. Alternative evaluation In the market, there are so many products where some of these products have the capability to satisfy an identified need. As a result, there is increased need among customers to try to define ways that helps them come up with the best brand for the already identified need. This step involves evaluation different alternatives from the collected information to define the one is the most suitable to the consumer needs where he or she selects the best suit. The attribute evaluation is done on two aspects; the objective characteristics, for instance, product functionality and features. The other point is based on subjective faces such as perceived value, reputation and perception of a brand. It is clear that not every consumer attributes the same significance to every attribute for the buying decision and the buying decision process (Baba & Alexander, 1999). The consumer uses the information that was collected previously and consumer’s perception in order to define a set of evaluation criteria. They evaluate the alternative with the increased need to satisfy his or her need for a product. The procedure at this level leads to an “evoked set “this refers to a set of brands with increased probability of being purchased by the consumer may be due to availability of a good image regarding the brand which is positive (Alice, 2001). The most important thing to note at this stage is that the higher the involvement level of the consumer and the significance of the purchase are study, the greater the number of solutions that the customer will take into consideration will be significant. Similarly, the amount of considered solutions will be smaller for a regular purchase. In the case of gold, it is something that has great variations in its purest form. Gold from ancient ruins will have the same worth as a newly minted gold. Therefore, in a customer decision making alternative variation choosing between the various types of Gold alloys such as 9K, 10K, 12K, 14K, 18K, 22K, 24K Gold. The alternative variation choice would depend on the need on how much how much actual gold in the context of ‘gold’ jewelry. For instance, buying gold for investment purposes going out for something that is 24K gold would serve as the best alternative Purchase decision In this stage, the consumer is already through with the evaluation of the diverse solutions and brand available for responding to his or identified need. As a result, the consumer can choose the brand that appears most suitable to his or her needs. Then continue to the definite purchase of the brand. The customer's choice will exceptionally rely on upon the selection mode and data produced using the past steps on the premise of the perceived quality brand, capacities and components that are critical to the buyer. It is essential to note that the consumer buying decision process and decision procedure is also possible to depend on aspects such as the quality of shopping experience, promotion availability and sale conditions (Veld, and Yulia, 2008). A good example is a consumer who is committed to the purchase of a Gold brand for status needs. His or her decision is likely to change in case of unpleasant with the Gold seller in the store. A promotion of Gold can also change a consumer mind who may be hesitating to between numerous brands of precious metals. Post-purchase behavior This refers to the stage after the product has been purchased and used. The consumer evaluates his or her original needs adequacy (those needs that triggered the buying behavior).The reason for this evaluation will be to define whether the consumer made the right choice in purchasing the product or not. The consumer will experience a sense of satisfaction for the brand or disappointment in case the brand falls short of the prospects. This kind of opinion will influence the future decision as well as the buying behavior. Once the product brings in satisfaction to the consumer, he or she will minimize the information search stages and alternative evaluation during the next purchase to purchase the same brand, thus resulting in customer loyalty. In contrast, if the consumers experience with the product was disappointing or average the consumer will repeat all the 5 stages of the buying process in the course of his or her next purchase, however, by eliminating the brand from his “evoked set”. The post purchase evaluation stage in the consumer behavior contains crucial brand consequences (Harvir, and Peter, 2000). There is increased likelihood that a satisfied consumer becomes a regular and loyal consumer. A sign of loyalty is a primary source of revenue for the brand once all purchase made by a consumer are combined together throughout his entire life referred to as a customer lifetime value. Consumers with a positive and a negative experience of a certain brand will also share their personal opinion on the brand. This is can be done through the word of the mouth of in their families. The customers can currently share their ideas now on a broader scale through the social network or even through websites with the consumer products review. Marketers and the business as a whole should not overlook this tendency because now with the presence of the Internet, any customer who does not satisfaction from a product can easily and strongly harm a brand. Therefore, it is important for companies to be conversant with this matter. Additionally, perfecting the customer mental object a guaranteed an efficient customer service and a particular call center are few of the assets that can be formulated to improve post-purchase behavior in case of any trouble with the product. Once a customer buys gold, he or she saves it a safe and proper place. A substantial amount of this commodity is saved in banks. Many customers after buying gold they build an urge to buy more and more in the future. However, this buying loyalty will be contributed to by the level of satisfaction these customers gets from many uses of gold in the future. Loyalty in buying gold is determined by the level of satisfaction and a gain customer gets after indulging in gold buying business. For some customers, gold is obtainable in the form of gold bars. This assist in making any type of ornaments in the future. Therefore, many customers would gain satisfaction in the context of exchanging purposes. Reference List Alice N Isen, 2001. An Influence of Positive Affect on Decision Making in Complex Situations: Theoretical Issues With Practical Implications. Journal of Consumer Psychology. Vol.11, No.2, pp 75-85 Baba ShivAlexander Fedorikh, 1999. Heart and Mind in Conflict: the Interplay of Affect and Cognition in Consumer Decision Making. Journal of Consumer Research. Vol, 26, No, 3. pp. 278-292 Dan Ariely, 2000.Controlling the Information Flow: Effects on Consumers’ Decision Making and Preferences. Journal of Consumer Research. Vol.27,No.2, pp. 233-248 Harvir S. Bansal and Peter A Voyer,2000. Word-of-Mouth Processes within a Services Purchase Decision Context Journal of Service Research. vol. 3 no. 2, pp. 166-177 Jillian C Sweeney and Geoffrey N Soitar, 2001.Consumer perceived value: The development of a multiple item scale. Journal of retailing. Vol.77,No.2, pp. 203-220 Michel Tuan Pham, 1998. Representativeness, Relevance, and the Use of Feelings in Decision Making Journal of Consumer Research. Vol.25 No, 2, pp. 144-159 Veld, Chris and Yulia V. Veld-Merkoulova, 2008.“The risk perceptions of individual investors.”Journal of Economic Psychology. Vol 10, No 1, pp. 226-252. Read More