Consumer Decision Making & Relationship Marketing

The Consumer’s decision to purchase or not to purchase a product or service is an important moment for most marketers. It can signify whether a marketing strategy has been successful or not. Therefore, marketing people are interested in the consumer’s decision making process.

For a consumer to make a decision, more than one alternative must be available, including the alternative called making a decision to not buy or not buy now.

The various models of 

1. Consumers View
2. Passive View
3. Cognitive View
4. Emotional View

depict consumers and their decision making processes in distinctly different ways.

An overview consumer decision making model ties together the psychologist, social,and cultural concepts into easily understood network. This decision model has 3 sets of variables: input variables, process variables and output variables.

Input variables that affect the decision – making process include commercial marketing efforts, as well as non commercial influences from the customer’s sociocultural environment. The decision process variables are influenced by the consumer’s psychological field, including the evoked set or the brands in a particular product category considered in making a purchase choice.

The psychological field influences the consumer’s recognition of a need, pre purchase search for information and evaluation of alternatives.

The output phase of the model includes the actual purchase (either trial or repeat purchase) and post purchase evaluation. Both pre purchase and post purchase evaluation feeds back in the form of experience into the consumer’s psychological field and serves to influence future decision making process.

GIFTING:

The process of gift exchange is an important part of consumer behaviour. 

Various gift giving and gift receiving relationships are captured by the following 5 specific categories in the gifting classification scheme:

1. Intergroup gifting: A group gives a gift to another group.
2. Intercategory gifting: An individual gives a gift to a group or a group gives a gift to an individual.
3. Intragroup gifting: A group gives a gift to itself or its members.
4. InterPersonal gifting: An individual gives a gift to another individual
5. Intrapersonal gifting: A Self Gift.

Consumer behaviour is not must making a purchase, it also includes the full range of experiences associated with using products or services. It includes the sense of pleasure and satisfaction derived from possessing or collecting “things”. The outputs of consumption are the changes in feelings,moods, attitudes, reinforcement of lifestyles, an enhanced sense of self; satisfaction of a consumer related need; belonging to groups; and expressing and entertaining oneself.

Among other things, consuming includes the simple utility of using a Superior product, the stress reduction of a vacation, the sense of having a “sacred” possession, and the pleasures of a hobby or a collection. Some possessions serve to assist consumers in their effort to create a personal meaning and to maintain a sense of the past.

Relationship Marketing impacts consumer’s decisions and their consumption satisfaction. Firms establish loyalty programs to foster usage loyalty and a commitment to continued usage of their products and services.

Relationship marketing is all about buildign trust between the firm and its customers and keeping promises made to the customers. Therefore the focus is always on developing long term bonds with customers by making them fee special and by providing them with personalized services.

How is your relationship marketing doing?

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Consumer Behaviour Influencers

Consumer Behaviour & Purchase Decisions Influenced by Reference Groups and Families

Almost all individuals regularly interact with other people who directly or indirectly influence their purchase decisions. Therefore, the study of groups and their impacts on the individual is of great importance,specially for the marketers who want to influence the consumer behaviours in favour of their products and services.

Consumer Reference Groups are groups that serve as frames of reference for individuals in their purchase decisions. Reference groups include:

1. Friends
2. Work Groups
3. Shopping Groups
4. Virtual Groups & Communities
5. Consumer Action Groups.

Normative Reference Groups are those groups that influence general values or behaviour.

Comparative Reference Groups are those that influence Specific Attitudes.

Consumer Reference Groups include groups with which consumers have no direct face to face contact such as film stars, sportspersons, other celebrities and social classes.

The credibility, attractiveness and power of the reference group affect the degree of influence it has. Reference group appeals are used very effectively by some advertisers in promoting their goods and services because they subtly induce the prospective consumer to identify with the pictured user of the product.

The 5 reference group appeals most commonly used in marketing are:

1. Celebrities
2. Experts
3. Common Man
4. Executive and Employee spokesperson
5. Trade Spokes Character

Celebrities are used to give testimonials or endorsements as actors or as company spokespersons.

Experts may be recognized experts in the concerned product category or actors playing the part of experts.

The common man approach is designed to show that individuals who are just like the prospective customers are satisfied with the advertised product or service.

Companies are using their top executives as spokespersons because their appearance in company advertisements seems to imply that someone at the top is watching over the customer’s interest.

For many customers, their family is their primary reference group for many attitudes and behaviours.

The family is the primary target for most products and services. As the most basic membership group, families are defined as two or more persons related by blood, marriage or adoption who reside together.

There are 3 types of families: Married Couples, Nuclear Families and Extended Families. 

Socialization is the core function of the family. Other functions being economic and emotional support and the pursuit of a suitable lifestyle for its members.

The members of a family assume specific roles in their everyday functioning: such roles or tasks extend to the realm of consumer purchase decisions. Key consumer related roles of family member include influencers, gatekeepers, deciders, buyers, preparers,users, maintainers and disposers.

A family’s decision making style in influenced by its lifestyle, roles and cultural factors e.g.: husband dominated, wife dominated, joint, autonomic decisions etc.,

Classification of the families by the various stages in the family life cycle (FLC) provides valuable insights into family consumption related behaviour.

The traditional FLC begins with bachelorhood, moves on to marriage, then to an expanding family, to a contracting family and to an end with the death of a spouse.

Various other situations also exists like childless couples, live in couples, single parents or single person households.

Who are the influencers for your Customers? How does this show up in Corporate Purchase decisions?

How are you leveraging the various influencers?

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