Consumer Research Process & Consumer Decision Making

Consumer Research
Marketing research is the function that links The consumer The customer And public to the marketer

Research comprises Comprises defining & redefining problems Formulating hypothesis or suggested solutions Collecting , organizing & evaluating data Making deductions & reaching conclusions And at last testing the conclusion to determine whether they fit the formulation

The role of consumer research in managerial decision making is explained further using the framework of the DECIDE

model:

D Define the marketing problem E Enumerate the controllable and uncontrollable

decision factors

C Collect relevant information I Identify the best alternative D Develop and implement a marketing plan E Evaluate the decision and the decision process

Types of research
Qualitative research Quantitative research

Quantitative Research
Descriptive in nature. Enables marketers to predict consumer behavior. Research methods include experiments, survey techniques, and observation. Findings are descriptive, empirical and generalizable.

Qualitative Research
Consists of depth interviews, focus groups, metaphor analysis, collage research, and projective techniques. Administered by highly trained intervieweranalysts. Findings tend to be subjective. Small sample sizes.

Characteristics of a good marketing research

Use of more scientific methods Cost and benefits Use of the Statistical method Alternative course of action

Scope of marketing research

The scope of marketing research could cover the business problems relating to the followings-

Types of consumers that compromise present and potential markets. Buying habits and pattern of consumption Size and location of different markets, not only in India but also overseas. The prospects for growth or construction for the current markets being served. New mantras of emerging segments. Marketing and manufacturing capabilities of competitors. Most suitable entry timing. The current and prospective competitive position. Chances of improvement of current channels. Optimum use of promo- tools.

Benefits of Marketing Research

Benefit to business and industry Benefits to economy. Enhanced ability to make well-informed decisions. Provides a cost-effective opportunity Facilitates a common knowledge bridge. Gives company an objective tool to help develop and promote employees. Assists researchers in understanding and differentiation between good research and impartial research.

Consumer research process

The Consumer Research Process

Six steps defining the objectives of the research collecting and evaluating secondary data designing a primary research study collecting primary data analyzing the data preparing a report on the findings

Figure 2.1 The Consumer Research Process

Develop Objectives Collect Secondary Data Design Qualitative Research Method Screener questionnaire Discussion guide Conduct Research (Using highly trained interviewers) Analyze Data (Subjective) Prepare Report Design Quantitative Research Method Sample design Data collection instrument Collect Primary Data (Usually by field staff) Exploratory Study Analyze Data (Objective) Prepare report

Developing Research Objectives

Defining purposes and objectives helps ensure an appropriate research design. A statement of objectives helps to define the type and level of information needed.

Secondary Versus Primary Data

Secondary data: data Primary data: data that has been collected by the collected for reasons researcher for the other than the purpose of meeting specific research specific objectives project at hand

Data Collection Methods

Observation

Experimentation

Surveys

Observational Research
Helps marketers gain an in-depth understanding of the relationship between people and products by watching them buying and using products. Helps researchers gain a better understanding of what the product symbolizes. Widely used by interpretivist researchers.

Experimentation
Can be used to test the relative sales appeal of many types of variables. Only one variable is manipulated at a time, keeping other elements constant. Can be conducted in laboratories or in the field.

Survey Data Collection Methods

Personal Interview Mail

Telephone
Online

Sampling Plan Decisions

Whom to survey?

How many?
How to select them?

Probability Sampling Designs

Simple random sample Systematic random sample

Stratified random sample

Cluster (area) sample

Non probability Sampling Designs

Convenience sample Judgment sample

Quota sample

Qualitative Data Collection Methods

Depth Interviews

Focus Groups

Projective Techniques

Metaphor Analysis

Focus Group

A qualitative research method in which eight to ten persons participate in an unstructured group interview about a product or service concept.

Projective Techniques

Research procedures designed to identify consumers subconscious feelings and motivations.

Metaphor Analysis
Based on belief that metaphors are the most basic method of thought and communication. Zaltman Metaphor Elicitation Technique (ZMET) combines collage research and metaphor analysis to bring to the surface the mental models and the major themes or constructs that drive consumer thinking and behavior.

Consumer decision process

Consumer decision
Buyer decision processes are the decision making processes undertaken by consumers in regard to a potential market transaction before, during, and after the purchase of a product or service.
Decision making is said to be a psychological construct. This means that although we can never "see" a decision, we can infer from observable behaviour that a decision has been made.

Consumer Benefits
People do not buy products or services, they buy benefits Hence we make purchases not for the products themselves, but for the benefits of the problems they solve or the opportunities they offer
e.g., always late so a watch helps solve problem; has stopwatch feature so now can keep track of work out times

The Consumer Decision-Making Process

A consumer decision model is a means of describing the processes that consumers go through before, during, and after making a purchase (choice). A model shows the causes or antecedents of a particular behavior and each of its results or consequences.

Consumer decision making varies with the

level of involvement in the purchasing decision

Extensive: problem solving occurs when buyers purchase more expensive, less frequently purchased products in an unfamiliar product category requiring information search & evaluation; may experience cognitive dissonance. Limited: problem solving occurs when buyers are confronted with an unfamiliar brand in a familiar product category Increase in Consumer evaluation processes

Routine: response behavior occurs

when buyers purchase low cost, low risk, brand loyal, frequently purchased, low personal identification or relevance, items with which they are familiar.

Types of Consumer Buying Decisions

Routine Response Behavior

Limited Decision Making

Extensive Decision Making

Less Involvement
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More Involvement

Five Factors influencing Decisions

Level of consumer involvement Length of time to make decision

Cost of good or service

Degree of information search Number of alternatives considered

Factors affecting Consumer involvement

Previous experience: low level involvement Interest: high involvement Perceived risk of negative consequences: high involvement Situation: low to high due to risk Social visibility: involvement increases with product visibility

So marketeers offers Offer extensive information on high involvement products In-store promotion & placement is important for low involvement products Linking low-involvement product to high-involvement issue can increase sales

Previous Experience

Interest Perceived Risk of Negative Consequences Situation

Factors Determining Level of Involvement

Social Visibility

Issues in Decision Making

Compensatory vs. noncompensatory--can an exceptionally good rating on one attribute outweigh a bad one elsewhere? Brand vs. attribute based processing

Factors Influencing Buying Decisions

Cultural Factors

Social Factors Psychological Factors

Individual Factors

CONSUMER DECISIONMAKING PROCESS

BUY / DONT BUY

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Culture
Set of values norms, attitudes, and other meaningful symbols that shape human behavior and the artifacts, or products, of that behavior as they are transmitted from one generation to the next.

Cultural Influences on Buying Decisions

Values Language Myths Customs

Components of American Culture

Rituals Laws Material Artifacts

Culture is...
Pervasive
Functional Learned Dynamic

Social Influences
Social Influences on Buying Decisions

Reference Groups Opinion Leaders

Family Members

Chapter 4 Version 3e

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Individual Influences
Individual Influences

Gender Age Family Life Cycle

Personality Self-Concept Lifestyle

Chapter 4 Version 3e

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Psychological Influences
Perception

Motivation

Psychological Influences on Buying Decisions

Chapter 4 Version 3e

Learning

Beliefs & Attitudes

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Perception

Selective Exposure Selective Retention

Selective Distortion

Chapter 4 Version 3e

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Motivation
Maslows Hierarchy of Needs

SelfActualization Esteem Social Safety Physiological

Chapter 4 Version 3e

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Learning

A process that creates changes in behavior, immediate or expected, through experience and practice.

Types of Learning Experiential Conceptual

Description An experience changes behavior Not learned through direct experience

Beliefs and Attitudes

Belief
An organized pattern of knowledge that an individual holds as true about his or her world. A learned tendency to respond consistently toward a given object.

Attitude

Decisions, decisions
You have a wedding to attend and you have to buy a present and an outfit Write down the steps that you think you would go through to make these two purchases Discuss this with a partner and note any differences between the processes you identified and perhaps some of the factors influencing your decision making
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Decisions and problems

Decision - choice between alternatives that can potentially solve a problem Problem - the difference between the consumers actual state and their desired state

Complete model of consumer behavior

Start
Need recognition Internal search Exposure Stimuli (marketer dominated, other) Attention Comprehension Acceptance Retention Memory Purchase Individual differences resources motivation & involvement knowledge attitudes personality, values, lifestyle Alternative evaluation Influences culture social class family situation

Search

Outcomes

External search

Dissatisfaction

Satisfaction

Need Recognition
Marketing helps consumers recognize (or create) an imbalance between present status and preferred state When a current product isnt performing properly
When the consumer is running out of an product When another product seems State Preferred superior to the one currently used

Search and involvement

Involvement
The amount of physical and mental effort and search that a consumer puts into a decision This effort is influenced by the level of importance of the decision e.g. emotional or financial risk

Types of involvement
Situational e.g. wedding outfit Enduring involvement, a more permanent involvement reflected across a range of decisions e.g. a consumers self perception as a fashionable wealthy person will influence all purchase decisions

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Involvement
Factors influencing involvement:
Personal involvement Situation involved in at the time of purchase Social visibility Perceived risk of negative consequences Previous experience

As decision making becomes more complex, consumers rely more on previous experience, knowledge, attitudes and the advice of others and less on available information

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Searching
Searching
May take months or less than a second

Factors that influence additional search include:

Belief that current known brands are inadequate More information on known brands is required Friends or other information sources provide messages that conflict with current knowledge A high degree of risk is involved and consumers require confirmation of their decisions

Internal search
Memory e.g. past purchases

External search
Internet, printed media, advertising, friends and others

Market mavens
Actively seek information on topics of interest

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EVOKED SET

Group of brands resulting from an information search , from which a buyer can chosse

Evaluation of Alternatives
Evoked Set
Evaluation of Products
Analyze product attributes Use cutoff criteria Rank attributes by importance

Purchase!

Categories of Alternatives
Awareness set Consideration set (evoked set) Inept set Inert set
Inept set Evoked set

All alternatives

Inert set

Awareness set