Explain Why It Is Important for Marketers to Understand the Consumer Decision Making Process

Understanding consumer behaviour is essential to succeed in business. As Solomon et al. (2013) stresses, businesses exist to satisfy consumer’s needs. By identifying and understanding the factors that influences their customers, firms have the opportunity to develop a more efficient strategy, marketing message and advertising campaigns that is more in line with the needs and ways of thinking of their target consumers (Perreau, 2015).

Consumers base and make their decisions on expected results. One theory states that consumers are seen as rational individuals who have the ability of estimating the results of different decisions made and thereby selecting the most lucrative one. This theory is known as utility theory. Though consumers are comparatively good at approximating the results of an occurrence, not all consumers are completely coherent, dependable or aware of all aspects in the decision-making process. For this reason, the utility theory has been criticized, but despite its insufficiency, the theory is still well thought-out as a main case in the concerns of decision-making. A new and simpler theory called satisficing had a different approach, instead of, as the utility theory, finding the best result, this theory allows the consumer choose what satisfies his/her needs and then stops the decision making process. An example of this could be the process of finding a house. A more psychological approach has been used in the research of consumer decision-making. This involves the development of prospect theory which has extended the two existing theories and has incorporated psychological factors by adding worth and endowment (Richarme, 2001).

The second step of the consumer buying process is searching for information, in which one seeks value. Once the problem is identified, the consumer searches for information about possible solutions. Depending on the complexity of the situation, a consumer will search more or less, which reflects his level of involvement. This is difference between trying a new brand of salsa at the grocery compared to buying a new car. When buying a car, most research heavily, while buying a new salsa usually involves little to no research. The buyer will use both internal and external information to guide his choice (Perreau, 2016). Internal information is already present because it comes from previous experiences that the buyer has had with a specific

To understand consumer behaviour is an important process as it allows marketers to comprehend better the reason why an individual choose to select, purchase and use a good or service to satisfy their needs and wants based on his or her buying tendencies and spending patterns. The analysis of consumer behaviour requires the consideration of various processes, internal and external factors for the individual. Both internal and external factors of an individual are required necessary for the analysis of consumer behaviour, as well as examining the complex interaction of many influencing elements, such as personal and cultural influences, which includes identity (Moutinho 1987). Identity plays a vital part in the unsustainable

Consumers are considered as the most important external stakeholders of an organization. They are the lifeblood of a business and the biggest source of revenues. Therefore, organizations need to meet and exceed their expectations in order to survive and compete with their rivals in the most competitive and profitable way (Koran, Faber, Aboujaoude, Large, & Serpe, 2010). These expectations can only be met if they are fully aware of their consumers' behavior towards their products or services (Pride & Ferrell, 2012). Therefore, the biggest challenge for them is to influence the consumers' buying decision through effective advertisements and promotional campaigns (Puccinelli, Goodstein, Grewal, Price, Raghubir, & Stewart, 2009).

Now and again, these topics may convert into changing desires for business organizations and arrangements. Based on the changing desires and needs and wants, “people 's purchasing behaviour ultimately, are shaped by their environment and their values. Therefore, when you are creating new products or services in different countries or regions, it is important to conduct research beforehand about the target market. Consider characteristics like the role of gender in the culture, their decision-making process and what they value the most”(Innov8 Education Solutions, 2017). Based on that, it is clearly stated that the importance of understanding the different culture is just cannot be ignored, and should be implemented to enter the market also understanding the consumer’s behaviour in the market. Besides, the importance of understanding the cross cultural communication through the brand that the company wants has to be accepted in the cultural or even in the society.

As the world becomes commercially more integrated the customers around the world have unprecedented amount of choices this makes the buying behavior more and more complex. The abundance of choices in the retail environment makes the completion between the sellers very intense. If that was not enough the ever new means of advertisement and readily available information on various goods make the buying decision even more complex.

Marketing has a goal of reaching consumers in order have an influence on their purchasing decisions. According to Barone, Miyazaki & Taylor, “the influence on choice depends on the motivation brought on by the company” (2000). If you were to take a look around you, companies have been using different tactics to persuade the way that consumers view and choose products.

As shown below in the Figure 2.5 on the next page, the consumer buying process is influenced by several different factors. The diagram is a modified version of an image created by Smith and Rupp, portrays what kind of thought process occurs when buying. The diagram was modified to portray the strategic buying process from the view point of a young Spanish woman who is using a fashion blog as a source of information. The original diagram, which considered the effect of social media on a buyer, was

In these modern days, consumers are bombarded with brands and advertising from different companies and they have a lot more options when it comes to purchasing a product. They usually rely on both intrinsic and extrinsic cues to solve their problem regarding to the quality of products. Consumers have to make their purchasing decision under various uncertainties and circumstances regarding to the product itself and its attributes as Cox (1962, p. 413) stated that ‘consumer 's task in evaluating a product is to use cues from the array as the basis for making judgments about the product’.

Social elements influence buyer conduct altogether. Each individual has somebody around affecting their purchasing choices. The essential social variables are: reference bunches, family, part and status. (Perreau, 2014.).

The individual buyer characteristics have a huge impact on final purchase decisions. Cultural, social, personal and psychological factors all affect characteristics of a consumer.

With this information in mind it is now possible to look at the theory behind consumer behaviour and the different models and theories that have been developed to analyze this behaviour.

This would logically then lead the consumer to the second part of the process ‘the pre-purchase search’, this is the point where the consumer begins to process the thought of what product may satisfy their need, they may base their ideas on previous experience and memories (psychological factors), or may opt to search for useful information to help in their decision (basic internet search). At this point the consumer is drawing up information from external sources and at the same time has psychological factors influencing their decision. i.e.Consumer’smotivation, perception, learning, personality and attitudes.

This subsection focuses on psychological factors that influence consumer behavior. In the latter subsection, it concerns social factors that would influence consumer behaviour.