Internal and External Factors That Influence Consumers' Decisions - Coursework Example

Consumer Behavior Name Institution Abstract Consumers decision making is a complex discipline that has seen many scholars giving their views regarding what factors influence consumers to make decisions to purchase a product or not. Influences can originate from within the individual regarded as internal factors or outside the individual which are normally regarded as external factors. There is need for marketers to understand the behavioral patterns of consumers and their perceived future behavior together with the psychology surrounding their behaviors. This paper will focus on both internal and external factors that influence consumers' decisions. These factors will be discussed extensively in the context of Ford Ranger Pickup which is a new model in the market. Introduction The decision on whether to purchase or not is a crucial moment for marketers. Marketers have made the consumer decision process a point of interest in the recent past and it is because of this reason that numerous research studies on consumer decision making process have emerged. Various approaches have been adopted in the study of consumer decision making processes and each of these approaches has emerged from psychological customs (Bray, 2008). These approaches comprise of the Economic Man approach, Psychodynamic approach, Behaviorist approach, Cognitive approach and Humanistic approach. As earlier mentioned, each of these approaches traces its roots to the early psychology. In particular, the cognitive approach traces its origins to the early philosophers such as Aristotle, Descartes and Socrates who perceived human beings as processors of information. Scholars have given preference to cognitive approach over behavioral approach owing to its ability to represent knowledge mentally (Bray, 2008). According to Foxall (1990), cognitive approach has four main strengths in giving an explanation of consumer behavior and they include; 1. Cognitive approach gives sensible explanations using day to day actions of purchasing by the consumers. 2. Consumers are capable of describing their everyday purchasing behavior with regards to their wants, motives, needs and their attitudes. 3. It comes along with unity and accord in the inquiry field. 4. Other fields that have made use of cognitive approach such as social science have aided in the abstract development of consumer research. In this regard, the behavior of a consumer in choosing to buy a good is normally determined a range of factors that are believed to have tremendous effect on intrapersonal processes. They include; perception, learning, memory, thinking, emotion and motivation (Bray, 2008; Sternberg, 1996). These factors can be categorized into two major groups; internal factors and external factors. Internal factors comprise of perception, learning, motivation, personality and attitude. On the other hand, external factors comprise of group influence and culture. Internal Factors Perception What a consumer perceives of a product is critical in the entire process of bringing a good to the market. When a consumer is purchasing a new product that he or she is not familiar with and in addition to this, it is costly, the process is quite complex and the consumer normally engage in extended problem solving in a bid to seek more information about the product (Bray, 2008). Cognitive dissonance takes the centre stage when making such choices of purchasing. For a case of familiar product, consumer decision making process differs from that of unfamiliar product and the consumer engage in limited problem solving. The search for information involves looking at the visual attributes of the product and available information in the long term memory of a consumer. The image of the product matters to a great extent in this case. According to Sun et al., (2009) a product with strong image in the consumers' long term memory is more likely to be purchased when need arises. The visual outlook of a product is therefore crucial in this case. In this context, the introduction of Ford Ranger into the market upon careful design of visual appearance is more likely to catch a glimpse of the consumers even if its functionality might be defective. Consumers' judgments are made based on visually perceivable characteristics (Sun et al., 2009). Lewaski (1998) similarly highlights the fact that judgments are related to the comprehended attributes which circulate around the desires of the consumer rather than their needs. With regards to information search in the long term memory, the degree of information search is dependent on type of problem to be solved; whether it is extended problem solving or limited problem solving. Search for information on new products will involve extensive search of information while familiar products may involve a local search of information with regards to previous behavior (Bray, 2008; Lamb et al., 2012). An individual will develop an attitude towards a product from the information obtained. The theory of reasoned action which is revised form of Fishbein model proposes that the overall attitude of an individual will be determined by feelings about the attributes of a product and beliefs surrounding the product (Bray, 2008). Hence, it is quite clear that perception as a factor of consumer decision making process is grounded on two major theories; theory of reasoned action and theory of planned behavior. Learning Learning as a factor affecting consumer decision making is that process by which the behavior of consumers are altered as a result of use of product or information access. According to Bayton (1958) refers to any behavioral change that occurs as a result of exposure to external stimulus conditions. Much has been done with regards to the effect of learning on consumer behavior. There is substantial evidence to indicate how models of learning have a tremendous effect on how people shop (Hopkins, 2006). If an individual has little knowledge of a product, he or she tends to look for more information. Marketers need to have knowledge on how to pass this information to the consumers. In the context of Ford Ranger pickup which is a new product in the market, the manufacturer should provide this information by use of methods such as provision of test drive to consumers. As a result, consumers will get information about the new brand. Learning factor of consumer behavior has been linked to classical and operant conditioning. In particular, operant condition is known to be of great importance in shaping consumer behavior. This type of learning posits that learning will occur if a process is repeatedly done. Manufacturers use this type of learning through the use of rewards to their customers. Offering after sale service to a car is also another perfect example of how operant conditioning has been used severally by manufacturers. Such a service will make the consumer always wanting to repeat the purchase. Classical conditioning on the other hand occurs when a product is given an association. For example, a car manufacturer may decide to use celebrity in an advert which is a symbol of success. Motivation It is the inward drive, urge, wishes or desires which bring into being a sequence of events normally referred to as behavior (Bayton, 1958). Marketing aims at meeting and satisfying consumers' needs (Durmaz & Diyarbakirgoglu, 2011). Motivation is not a new concept and it was coined by the early philosophers such as Abraham Maslow who came up with Hierarchy of needs governing choices. Modern marketing is grounded on human needs. The ability of a company to survive amid stiff competition is dependent on how it has identified and fulfilled consumers' needs (Durmaz & Diyarbakirgoglu, 2011). The needs of human beings are numerous. According to Durmaz & Diyarbakirgoglu (2011) these needs can either be biogenic or psychogenic. Notably, a need changes to be a motive once it has attained a required intensity level upon arousal. Kotler (2002) highlights the fact that a motive is a need that compels an individual to act. Basic needs must be fulfilled first before the needs of self actualization. The type of product and the level at which it falls in the Maslow's Hierarchy of needs matters to a great extent. Marketers need to look at the individual needs when they are marketing their products. In the context of Ford ranger designed for extra comfort, it will be prudent enough to choose a developed nation than a third world country basically because the product falls in the level of self actualization in Maslow's Hierarchy of needs. Attitude Attitude is the overall evaluation of a product that can either be favorable or unfavorable (Carvalho, 2008). A set of beliefs makes up an attitude. Attitudes are normally hard to change because they are grounded on beliefs. Some products have been given negative connotations thus instilling a bad feeling amongst the consumers. For example, it is widely believed that fast foods are not healthy to individuals, hence giving an assurance to the consumers on the quality of a product will increase the chances of consumers liking the product. Similarly, if Ford Ranger has been a negative connotation of unsafe owing to brake failure, there are high chances that this product will fail in the market. Attitude is important in the design of a product to match consumers' beliefs. External Factors Group Influence Consumers’ buying decisions are determined by groups which they think are part of or anticipate being in. It is for this reason that some technology products marketers use celebrity endorsement to advertise their brands basically because everyone wants to be associated with them (Yang, He & Lee, 2007). Notably, there are also the dissociative groups of individuals for which everyone does not want to be associated with. At times, consumers may avoid buying certain car models basically because they think that it would put them into groups they do not want to be incorporated in (Bird, 2002). In addition to this, individuals may buy certain models just to express their self concept and their association with people of similar class. For instance, if in our context Ford Ranger is perceived by many to be for the rich, rich individuals are more likely to buy it. In this regard, marketers ought to know the point of focus when advertising their brands. Since wealthy people desire to be separated from the poor class individuals, car manufacturers will target them, but at the same time attracting the large audience who want to imitate wealthy. Another group is a society movement which may support or oppose certain car models. Such movements may fuel consumer activism in support or against particular car models depending on this model’s perceived information to them. For instance, if a car model is perceived to be unsafe or expensive than other models for no good reason, a society movement may campaign against it. Contrary to that, the society movement may support the same product if it is perceived beneficial to the community relative to other similar products (Murray, 2013). Culture Culture is the sum total of learned beliefs, values, and customs that serve to control consumer behavior of members of a given society; whereas cultural beliefs are oral or mental statements that indicate knowledge and assessment of given product (Levi, 2007). Culture dictates the manner in which a person should act in order to remain accepted in the society. For example, the values which determine Australian culture when deciding on buying include masculinity, power distance, uncertainty avoidance, and individualism. Individualism is degree to which people see themselves and create decisions based more on individual level than a group (Gaumer & Seif, 2007). In the context of Ford Ranger, perhaps this car model was designed for speed thus making it a fuel guzzler. Marketing this model in a country like China where there is a shared belief in efficiency and effectiveness, is more likely to fail. It is therefore crucial for manufacturers to understand the culture of its consumers (Lamb, 2012). It is quite crucial to note that culture is learned and dynamic. Dynamicity is attributed to the changing technology. Conclusion In conclusion customer decision making is affected by various factors both the originate from within an individual and outside. Consumer behavior constitutes variation of consumer thought during buying decision-making process. Consumer decision-making requires marketers to learn consumer behaviors in all dimensions so that they would be able to design appropriate marketing strategies. Consumer behavior varies from one culture to another and from one nation to another. This paper has covered external and internal factors influencing consumer decision-making References Bayton, J. A. 1958. Motivation, Cognition, Learning-Basic Factors in Consumer Behavior. Journal of Marketing, 22(3)> 282-289. Bird, A. 2002. Retail industry. London: Routledge. Bray, J. P. 2008. 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