The Way Businesses Analyze How Consumers Make Choices in Relation to Technology and Risk - Essay Example

Consumer and Choice

Introduction

To achieve success, businesses use various strategies. One such strategy involves analyzing the criteria followed by the customers in making their choices. Businesses use the analysis of the way consumers make choices in developing marketing strategies for the products in which they intend to sell to the consumers. This essay discusses the way businesses analyze how consumers make choices in relation to technology and risk, which can help a business in creating a successful strategy to market their product.

Technology

Technology is one of the factors that affect the choice made by a consumer in purchasing a product. Thus, it is essential to analyze the technology preference of the consumers so that they can be able to develop a successful strategy in marketing their product. Technology has affected the way advertisements of products are done. Most consumers will make a choice of buying a product if it is advertised using up-to-date technology such through the social media than when the advertisement is done using traditional methods. Technology such as the social media allows a business to know the preferences of the customer and hence enabling the business to produce a product that fits the taste of the consumer (Abidi, 2012). Eventually, producing a product that fits the taste of the consumer will lead to increased marketability of the product.

Technology has advanced to incorporate online buying of products. A consumer will prefer to buy a product that can be bought online than physically going to purchase the product. The preference of the consumer in purchasing products online is a key consideration in analyzing the consumer’s behavior. This will assist the business developing marketability strategies. Through technology, consumers can now purchase products through mobile phones application. After purchasing and delivery has been done, the consumer is provided with the chance of evaluating the product and letting the business or producers know how they feel about the product through commenting which is made possible by the advanced technology. Through the comments, the business will be able to produce a product in accordance with the comments made by the consumers, hence increasing the marketability of the product (Abidi, 2012, p.1).

Technology is constantly changing. Business needs to be equipped with the latest technology that will help it in fitting into the taste of the consumers. Businesses that are stuck in out-dated technology are likely to have poor marketability of their products unlike those that are using the latest technology (Abidi, 2012, p.1).Technology has allowed the personalization of products to a great extent. Through the technology, businesses can meet the expectations and demands of the consumer (Barkworth, 2014, p.1). It is thus paramount for any business to consider technology in the analysis of the choices made by the customers so as to ensure that they develop a successful marketing strategy.

Technology disrupts the established behavioral pattern of consumers and thus is an essential consideration for every business. Technology affects the extent to which a consumer will react to a product. Whereas some technology is likely to put off a consumer from purchasing a product, others will empower the consumer to purchase the product. Such technologies which are likely to empower the consumers include the use of smartphone technology which allows the interaction of the consumers and the business or producers (Szmigin and Piacentini, 2014, p.67). The business should carry out a comprehensive analysis of the right technology to use or employ in the business and marketing of the product, that is, a technology that will attract more consumers to it rather than put them off. Identification of the right technology that should be employed by a business will assist it in developing marketing strategies.

Technology is observed to disrupt the choices made by consumers due to the high pace at which it is changing. This makes the consumers to be skeptical in the choices they make. This is because, they are always expecting better and improved products every time they are buying a product as a result of the constantly advancing technology (Arthur, 2013, p.1).

Technology leads to increased competition and thus improved marketability. Through technology, new ideas are brought in the business. Technology leads to improved methods of production which increase the competitive power of business (Arthur, 2013, p.1).

Technology affects the consumption of products by the consumers. Technology affects the way consumers think about a product. It enhances on the general physicality of a product which is likely to attract the consumer into purchasing it. Technology inspires and motivates the consumer into trying a certain product. Additionally, technology allows the consumers to purchase products from any place and at any time (Yarrow, 2012, p.1). Therefore, a business that has a technology in which the consumers can buy a product at any time and any place will attract more consumers than that which does not use technology. Likewise, a company that uses technology will attract more consumers through inspiration unlike that which has no technology. Evidently, an analysis should be done by the business to help in the identification and application of technology that allows for buying and selling at any place and time and which inspires and motivate consumers so to assist in the development of marketing strategies.

Technology influences the choices made by a customer in purchasing a particular product. That is, technology will influence the product that the customer chooses. Technology has led to the development of new product that replaces those that were produced earlier. For instance, instead of buying an analog phone, the customer will choose to buy a digital phone (Wladawsky-Berger, 2012, p.1). Doing an analysis of the customers’ choice in relation to technology will be useful since it will help in pointing out to the company the type of products that they should produce. This will be useful since it will help them in avoiding any loss that may be encountered as a result of the production of out dated products whose marketability is low. The analysis will assist the company in developing marketing strategies which will lead to success.

Risk

Risk is a key factor considered by the consumers when making chooses about purchasing a certain product. The consumer may not have the ability or the voice to let the producer, or the business knows about the risk that is associated with a certain product. The consumer will thus respond to the risk by choosing not to purchase the product. One of the risks in which a product may exhibit risk is through quality. A consumer may choose not to buy a product because of the risk of uncertainty about the quality of the product. In such a case, businesses or the producers are required to guarantee the consumers of the quality of the product (McNally, 2015, p.1). The business should thus carry an analysis so as to determine the risk contained in a product which may affect the choice made by consumers.

There are six risks’ types which affect the choices that are made by a consumer and which the business should analyze to determine the consumer’s choice of products based on the risks. First, the functional risk is the uncertainty of the whether a product will work as was expected. The consumer will thus be skeptical in choosing a product in fear that it might not perform the expected function. Secondly, the physical risk involves an injury that may result from using a product. Physical risk can be illustrated by the reluctance in buying a car in consideration of accidents that result from purchasing such a product. Thirdly, financial risks encompass the loss of money or fear of not achieving a certain amount of profit from a product. A consumer is skeptical in purchasing a product since he or she may see it as a way in which money is lost. Fourth, social risk occurs when one fears that buying, using or storing a product may affect the social life of an individual. For example, a person may fear that using a certain product will create a bad perception in the society. That person will end up choosing a product in which he will be comfortable to buy, use or store in the eyes of the society. Fifth, the psychological risk will occur based on how a consumer feels about himself or herself when purchasing a product. A consumer may opt not to choose a product since he may fear the feelings that he will have if chooses the wrong product or if the product does not match his or her expectations. Finally, the time risk occurs when the consumer fears that time might be lost after choosing the products (McNally, 2015, p.1). Businesses are required to make determine how the choices of the consumers are affected by the six risks types. This will assist them in developing a marketing strategy that will be successful

As the consumers purchase products, they mentally categorize the product based on various factors (Webb, 2015, p.4). One of the factors that consumers use to categorize the product is by associating it with risk. The consumer will do the categorization based on the various levels or the extent of risk that a product possesses. He will, therefore, choose a product which is categorized under minimal risk and will reject products with high levels of risks. The consumer will also consider purchasing the products which are similar in terms of the level of risk which is associated with them. Consumers perceive the risk of products by feeling. This indicates that the risk of a product will be perceived differently by dissimilar people (Webb, 2015, p.50).Here, the different levels of risk categorization should be determined so as to establish the level at which a product appears to be risky thus preventing the risk associated with it.

Clearly, risk is a key determinant of the choices made by consumers. In realizing of how risk can affect the sale of their products, the business should consider strategies which will reduce the risk of the product. Reducing the risk will lead to increased profits due to increased marketability of the products. The product should be branded so as to ensure that the customers are ensured that the risk perceived by the customer about the product is minimal. Not only does a branded product have a reduced risk but also has a high market value associated with it. During the analysis of the choices made by the consumers, consideration has to be done based on the people’s avoidance of risk. First, the risk must be identified followed by the determination of the frequency of the risk and its size. The business should use various methods in reducing the product’s risks based on the consistency and size of the risk. To find out the risk of a product, it is advisable that interviews are done. The interviews should mainly involve consumers who have recently made a choice to buy or not to buy a certain product (McNally, 2015). Using this method, the business will be able to a good analysis of the choices made by their customers which will assist them in developing marketing strategies for the products in which they intended to sell.

Conclusion

Clearly, technology and risk are important aspects that should be considered in the analysis of how consumers make their choices which is important in businesses during the development of strategies that will market it. Advanced technology is more preferred by customers when they are choosing the product to invest in. On the other hand, consumers will choose a product that has little or no risks.