The Buyer Decision Process

• Process
• Needs can be triggered by:
Stages – Internal stimuli
• Normal needs become
• Need recognition strong enough to drive
• Information search behavior
• Evaluation of – External stimuli
• Advertisements
alternatives • Friends of friends
• Purchase decision
• Post purchase
behavior
 Sources of Problem Recognition

•• New
New Needs
Needs
•• Out
Out of
of Stock
Stock •• Dissatisfaction
Dissatisfaction •• or
or Wants
Wants

•• Related
Related •• Market-
Market- •• New
New
Product
Product Induced
Induced •• Products
Products
•• Purchase
Purchase •• Recognition
Recognition
• © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
 The Buyer Decision Process

• Process • Information is done by two

ways
Stages 1. External Search
• Need recognition
2. Internal Search
• Information search
• Evaluation of
alternatives
• Purchase decision
• Post purchase
behavior
 Information Search

• Personal
• Sources
•M
arket
• So
urces
•P
• S ublic
our
ce s
•P
• E erso
xp n
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• © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin

 The Buyer Decision Process

• Process • Evaluation procedure

depends on the
•
Stages
Need recognition
consumer and the buying
situation.
• Information search • Most buyers evaluate
• Evaluation of multiple attributes, each
alternatives of which is weighted
• Purchase decision differently.
• Postpurchase behavior • At the end of the
evaluation stage,
purchase intentions are
formed.
 The Buyer Decision Process

• Process • Two factors intercede

between purchase
Stages intentions and the actual
• Need recognition
decision:
• Information search – Attitudes
• Evaluation of – Unexpected situational
alternatives factors
• Purchase decision
• Post purchase behavior
 The Buyer Decision Process

• Process • Satisfaction is important:

– Delighted consumers engage
Stages in positive word-of-mouth.
– Unhappy customers tell on
• Need recognition
average 11 other people.
• Information search – It costs more to attract a new
• Evaluation of customer than it does to
retain an existing customer.
alternatives
• Purchase decision
• Post purchase behavior
 Consumer Decision Making

• Decision Stage • Psychological Process

• Problem Recognition • Motivation

• Information Search • Perception

• Alternative Evaluation • Attitude Formation

• Purchase Decision • Integration

• Post purchase • Learning

Evaluation

• © 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin

 Models/Approaches to Study of
Buyer Behavior
• Economic model
• Psychological Model
• Sociological Model
• The Howarth Sheth Model
• Nicosia Model
• The Engel –Kollat-Blackwell Model
• Engle, Blackwell and Miniard (EBM) Model
 Economic Model
In this model, consumers follow the principle of maximum
utility based on the law of diminishing utility. The
consumer wants to spend the minimum amount for
maximising his gains.
Economic man model is based on:
Price effect: Lesser the price of the product, more will be
the quantity purchased.
Substitution effect: Lesser the price of the substitute
product , lesser will be utility of the original product
bought.
Income effect: When more income is earned, or more
money is available, more will be the quantity purchased.
 Limitations of Economic Model
1.It assumes the homogeneity of the market.
2. It concentrates only on the product or
price.
3. It ignores all the other aspect like
perception, motivation, learning, attitudes,
personality etc.
 Psychological Model
• The Psychological Model is based on the
famous psychologist A.H. Maslow’s theory
of Hierarchy of Needs. The psychological
model divides the needs into
Psychological Needs, Safety and Security
Needs, Social Needs, Ego Needs and Self
Actualization Needs. This division of
needs is termed as Hierarchy of Needs.
• A. H. Maslow said the purchasing process
and behaviour is governed by motivational
forces.
• Motivation stimulates people into action.
Motivation starts with the need. It is driving
force and mental phenomenon.
• Once a need is satisfied, a new need
arises and the process is continued.
 Sociological Model
• The Sociological Model of Consumer Behavior is closely
related to the society and the versatile groups involved in
the same. These groups can be classified into Primary
and secondary ones.

Primary groups consist of close acquaintances, friends,

relatives and family members.
Secondary group consists of any member in the society, his
personality type and requirements based on the same.

Sociological Model focuses mainly on the lifestyle and

related product requirements of consumers in the society in
a holistic manner.
 The Nicosia Model
• Nicosia Model deals with the level of
exposure a consumer gets with respect to
the purchase decision. This model is
based on four fields such that the output of
one field acts as the input of second field
and so on.
• Field 1: The consumer attitude based on the firms’ messages.
The first field is divided into two subfields. The first subfield
deals with the firm’s marketing environment and
communication efforts that affect consumer attitudes, the
competitive environment, and characteristics of target market.
Subfield two specifies the consumer characteristics e.g.,
experience, personality, and how he perceives the promotional
idea toward the product in this stage the consumer forms his
attitude toward the firm’s product based on his interpretation
of the message.
• Field 2: search and evaluation The consumer will start to
search for other firm’s brand and evaluate the firm’s brand in
comparison with alternate brands. In this case the firm
motivates the consumer to purchase its brands.
• Field 3: The act of the purchase The result of
motivation will arise by convincing the consumer to
purchase the firm products from a specific retailer.
• Field 4: Feedback This model analyses the feedback
of both the firm and the consumer after purchasing
the product. The firm will benefit from its sales data
as a feedback, and the consumer will use his
experience with the product affects the individuals
attitude and predisposition’s concerning future
messages from the firm.
 Engel –Kollat- Blackwell (EKB) Model

It consists of five components:

i) Awareness
ii) Information processing
iii) Evaluation
iv) Purchasing Decision
v) Outcome Analysis
The Engel-Kollat-Blackwell model of consumer behavior
outlines a five-stage decision process that consumers go through
before purchasing a product or service.
• Awareness: During this stage, consumers view advertisements
from a business and become aware of their need, desire, or
interest, to purchase what they've just discovered.
• Information Processing: After discovering a product or
service, a consumer begins to think about how the product or
service relates to their past experiences or needs and whether it
will fulfill any current needs.
• Evaluation: At this point, consumers will
research the product they’ve discovered and
research options from competitors to see if there
is a better option or if the original product is the
best fit.
• Purchasing Decision: A consumer will follow
through with a purchase for the product that has
beat out competitors to provide value. A
consumer may also stop the process if they
change their mind.
• Outcome Analysis: After making a purchase, a
customer will use what they’ve bought and
assess whether their experience is positive or
negative. After a trial period, they’ll keep a
 HOWARD SHETH MODEL
This model was proposed by keeping both the industrial
& consumer products, in order to give an
understanding about great variety of behaviours. It
shows the rational brand choice behaviour by buyer
under conditions of incomplete information. It
proposes levels of decisions making.
1. The first level describes the extensive problem
solving.
2. The second level is limited problem solving.
3. The third level is a habitual response behavior.
• Extensive Problem Solving:
In this the customer does not have any basic information
about the brand and any preferences for any product. Then
he will find information about all brands from the market
before purchase.

• Limited Problem Solving:

In this, customer has little knowledge about brands and
market. This is an advance stage where the choice criterion
is defined but the exact solution of the problem is unknown
to the customer.
• There are four components describe in the
model which causes the actual purchase
behaviour.
• Input Variables
• Out Put variables
• Hypothetical Constructs
• Exogenous Variable
• The input variable consists of some stimulate
which serves as the information to the
consumer.
• 1. Significative Stimuli: This is the elements of
the brands which the consumer comes across.
2. Symbolic Stimuli: This consists of the stimuli
which the producer shows about the various
attributes /benefits of his product.
• 3. Social Stimuli: This consist of those
environmental factors which can act as the
source of input.
• Output variable: This output is the ultimate response of
the consumer. In order to come to a conclusion
regarding the purchase consideration he follows
sequential order.
Attention —– Comprehension —– Attitude—– Intention—-
Purchase Behaviour
• The consumer first is attentive towards the various
stimuli which help him in comprehensive way about
various brands. He then develops an attitude for the
product due to which he has some intention regarding
the purchase decisions.
• Hypothetical Construct: These are the
interviewing variables which influence the
customers output decision. It consists of major
variables.
• 1. Perceptual Constructs
• 2. Learning Constructs
Perceptual Constructs: This helps in the
information processing for the selecting of a brand.
It consists of three steps.
Sensitively to information: Where in the customer
is open to the options available to him
• Perceptual Bias: The consumer then has a biased
opinion regarding the various brands, because he
perceives each brand differently.
• Search for Information: The consumer further searches
for information in order to come to a conclusion.
• Learning Constructs: This involves the formation of
concepts regarding various brands. This consist of
various factors like motive, brand potential of evoke set,
decision mediators, pre – dispositions, inhibitors
satisfaction.
• Exogenous Variables: These are the
External factors which influence the
decision making process. This could
include the importance of purchase,
personality, social class., culture,
organisation, financial status.
• Therefore, this model gives on overall
views regarding consumer purchases
keeping in view all the factors influencing
the organisation as well as the end
consumer.
HOWARDSHETH MODEL
Engle, Blackwell and Miniard Model
• This model is also called the consumer
decision model. The model is “structured
around a seven-point decision process:
need recognition followed by a search of
information both internally and externally,
the evaluation of alternatives, purchase,
post-purchase reflection, and finally,
divestment” (Solomon, Russell-Bennett, &
Previte, 2012). A consumer identifies a
need before proceeding to carry out a
search based on the complexity of the
issue at hand.
• The pre-purchase evaluation of
alternatives follows where one explores
the available options based on beliefs, the
availability of resources, and
environmental factors among others. One
then purchases a good or service based on
its utility. After consumption, a consumer
carries out post-consumption analysis,
which in most cases is termed as
feedback. The divestment stage is
peripheral in the process, and it
acknowledges that at one point the good