case study on consumer decision making process

The consumer decision journey

If marketing has one goal, it’s to reach consumers at the moments that most influence their decisions. That’s why consumer electronics companies make sure not only that customers see their televisions in stores but also that those televisions display vivid high-definition pictures. It’s why Amazon.com, a decade ago, began offering targeted product recommendations to consumers already logged in and ready to buy. And it explains P&G’s decision, long ago, to produce radio and then TV programs to reach the audiences most likely to buy its products—hence, the term “soap opera.”

Marketing has always sought those moments, or touch points , when consumers are open to influence. For years, touch points have been understood through the metaphor of a “funnel”—consumers start with a number of potential brands in mind (the wide end of the funnel), marketing is then directed at them as they methodically reduce that number and move through the funnel, and at the end they emerge with the one brand they chose to purchase (Exhibit 1). But today, the funnel concept fails to capture all the touch points and key buying factors resulting from the explosion of product choices and digital channels , coupled with the emergence of an increasingly discerning, well-informed consumer. A more sophisticated approach is required to help marketers navigate this environment, which is less linear and more complicated than the funnel suggests. We call this approach the consumer decision journey. Our thinking is applicable to any geographic market that has different kinds of media, Internet access, and wide product choice, including big cities in emerging markets such as China and India.

In the traditional funnel metaphor, consumers start with a set of potential brands and methodically reduce that number to make a purchase.

We developed this approach by examining the purchase decisions of almost 20,000 consumers across five industries and three continents. Our research showed that the proliferation of media and products requires marketers to find new ways to get their brands included in the initial-consideration set that consumers develop as they begin their decision journey. We also found that because of the shift away from one-way communication—from marketers to consumers—toward a two-way conversation, marketers need a more systematic way to satisfy customer demands and manage word-of-mouth. In addition, the research identified two different types of customer loyalty , challenging companies to reinvigorate their loyalty programs and the way they manage the customer experience.

Finally, the research reinforced our belief in the importance not only of aligning all elements of marketing—strategy, spending, channel management, and message—with the journey that consumers undertake when they make purchasing decisions but also of integrating those elements across the organization. When marketers understand this journey and direct their spending and messaging to the moments of maximum influence, they stand a much greater chance of reaching consumers in the right place at the right time with the right message.

How consumers make decisions

Every day, people form impressions of brands from touch points such as advertisements, news reports, conversations with family and friends, and product experiences. Unless consumers are actively shopping, much of that exposure appears wasted. But what happens when something triggers the impulse to buy? Those accumulated impressions then become crucial because they shape the initial-consideration set: the small number of brands consumers regard at the outset as potential purchasing options.

The funnel analogy suggests that consumers systematically narrow the initial-consideration set as they weigh options, make decisions, and buy products. Then, the postsale phase becomes a trial period determining consumer loyalty to brands and the likelihood of buying their products again. Marketers have been taught to “push” marketing toward consumers at each stage of the funnel process to influence their behavior. But our qualitative and quantitative research in the automobile, skin care, insurance, consumer electronics, and mobile-telecom industries shows that something quite different now occurs.

Actually, the decision-making process is a more circular journey, with four primary phases representing potential battlegrounds where marketers can win or lose: initial consideration; active evaluation, or the process of researching potential purchases; closure, when consumers buy brands; and postpurchase, when consumers experience them (Exhibit 2). The funnel metaphor does help a good deal—for example, by providing a way to understand the strength of a brand compared with its competitors at different stages, highlighting the bottlenecks that stall adoption, and making it possible to focus on different aspects of the marketing challenge. Nonetheless, we found that in three areas profound changes in the way consumers make buying decisions called for a new approach.

The decision-making process is now a circular journey with four phases: initial consideration; active evaluation, or the process of researching potential purchases; closure, when consumers buy brands; and postpurchase, when consumers experience them.

Brand consideration.

Imagine that a consumer has decided to buy a car. As with most kinds of products, the consumer will immediately be able to name an initial-consideration set of brands to purchase. In our qualitative research, consumers told us that the fragmenting of media and the proliferation of products have actually made them reduce the number of brands they consider at the outset. Faced with a plethora of choices and communications, consumers tend to fall back on the limited set of brands that have made it through the wilderness of messages. Brand awareness matters: brands in the initial-consideration set can be up to three times more likely to be purchased eventually than brands that aren’t in it.

Not all is lost for brands excluded from this first stage, however. Contrary to the funnel metaphor, the number of brands under consideration during the active-evaluation phase may now actually expand rather than narrow as consumers seek information and shop a category. Brands may “interrupt” the decision-making process by entering into consideration and even force the exit of rivals. The number of brands added in later stages differs by industry: our research showed that people actively evaluating personal computers added an average of 1 brand to their initial-consideration set of 1.7, while automobile shoppers added 2.2 to their initial set of 3.8 (Exhibit 3). This change in behavior creates opportunities for marketers by adding touch points when brands can make an impact. Brands already under consideration can no longer take that status for granted.

The number of brands added for consideration in different stages differs by industry.

Empowered consumers.

The second profound change is that outreach of consumers to marketers has become dramatically more important than marketers’ outreach to consumers. Marketing used to be driven by companies; “pushed” on consumers through traditional advertising, direct marketing, sponsorships, and other channels. At each point in the funnel, as consumers whittled down their brand options, marketers would attempt to sway their decisions. This imprecise approach often failed to reach the right consumers at the right time.

In today’s decision journey, consumer-driven marketing is increasingly important as customers seize control of the process and actively “pull” information helpful to them. Our research found that two-thirds of the touch points during the active-evaluation phase involve consumer-driven marketing activities, such as Internet reviews and word-of-mouth recommendations from friends and family, as well as in-store interactions and recollections of past experiences. A third of the touch points involve company-driven marketing (Exhibit 4). Traditional marketing remains important, but the change in the way consumers make decisions means that marketers must move aggressively beyond purely push-style communication and learn to influence consumer-driven touch points , such as word-of-mouth and Internet information sites.

Two-thirds of the touch points during the active-evaluation phase involve consumer-driven activities such as Internet reviews and word-of-mouth recommendations from friends and family.

The experience of US automobile manufacturers shows why marketers must master these new touch points. Companies like Chrysler and GM have long focused on using strong sales incentives and in-dealer programs to win during the active-evaluation and moment-of-purchase phases. These companies have been fighting the wrong battle: the real challenges for them are the initial-consideration and postpurchase phases, which Asian brands such as Toyota Motor and Honda dominate with their brand strength and product quality. Positive experiences with Asian vehicles have made purchasers loyal to them, and that in turn generates positive word-of-mouth that increases the likelihood of their making it into the initial-consideration set. Not even constant sales incentives by US manufacturers can overcome this virtuous cycle.

Two types of loyalty

When consumers reach a decision at the moment of purchase, the marketer’s work has just begun: the postpurchase experience shapes their opinion for every subsequent decision in the category, so the journey is an ongoing cycle. More than 60 percent of consumers of facial skin care products, for example, go online to conduct further research after the purchase—a touch point unimaginable when the funnel was conceived.

Although the need to provide an after-sales experience that inspires loyalty and therefore repeat purchases isn’t new, not all loyalty is equal in today’s increasingly competitive, complex world. Of consumers who profess loyalty to a brand, some are active loyalists, who not only stick with it but also recommend it. Others are passive loyalists who, whether from laziness or confusion caused by the dizzying array of choices, stay with a brand without being committed to it. Despite their claims of allegiance, passive consumers are open to messages from competitors who give them a reason to switch.

Take the automotive-insurance industry, in which most companies have a large base of seemingly loyal customers who renew every year. Our research found as much as a sixfold difference in the ratio of active to passive loyalists among major brands, so companies have opportunities to interrupt the loyalty loop. The US insurers GEICO and Progressive are doing just that, snaring the passively loyal customers of other companies by making comparison shopping and switching easy. They are giving consumers reasons to leave, not excuses to stay.

All marketers should make expanding the base of active loyalists a priority, and to do so they must focus their spending on the new touch points. That will require entirely new marketing efforts, not just investments in Internet sites and efforts to drive word-of-mouth or a renewed commitment to customer satisfaction.

Aligning marketing with the consumer decision journey

Developing a deep knowledge of how consumers make decisions is the first step. For most marketers, the difficult part is focusing strategies and spending on the most influential touch points. In some cases, the marketing effort’s direction must change, perhaps from focusing brand advertising on the initial-consideration phase to developing Internet properties that help consumers gain a better understanding of the brand when they actively evaluate it. Other marketers may need to retool their loyalty programs by focusing on active rather than passive loyalists or to spend money on in-store activities or word-of-mouth programs. The increasing complexity of the consumer decision journey will force virtually all companies to adopt new ways of measuring consumer attitudes, brand performance, and the effectiveness of marketing expenditures across the whole process.

Without such a realignment of spending, marketers face two risks. First, they could waste money: at a time when revenue growth is critical and funding tight, advertising and other investments will be less effective because consumers aren’t getting the right information at the right time. Second, marketers could seem out of touch—for instance, by trying to push products on customers rather than providing them with the information, support, and experience they want to reach decisions themselves.

Four kinds of activities can help marketers address the new realities of the consumer decision journey.

Prioritize objectives and spending

In the past, most marketers consciously chose to focus on either end of the marketing funnel—building awareness or generating loyalty among current customers. Our research reveals a need to be much more specific about the touch points used to influence consumers as they move through initial consideration to active evaluation to closure. By looking just at the traditional marketing funnel’s front or back end, companies could miss exciting opportunities not only to focus investments on the most important points of the decision journey but also to target the right customers.

In the skin care industry, for example, we found that some brands are much stronger in the initial-consideration phase than in active evaluation or closure. For them, our research suggests a need to shift focus from overall brand positioning—already powerful enough to ensure that they get considered—to efforts that make consumers act or to investments in packaging and in-store activities targeted at the moment of purchase.

Tailor messaging

For some companies, new messaging is required to win in whatever part of the consumer journey offers the greatest revenue opportunity. A general message cutting across all stages may have to be replaced by one addressing weaknesses at a specific point, such as initial consideration or active evaluation.

Take the automotive industry. A number of brands in it could grow if consumers took them into consideration. Hyundai, the South Korean car manufacturer, tackled precisely this problem by adopting a marketing campaign built around protecting consumers financially by allowing them to return their vehicles if they lose their jobs. This provocative message, tied to something very real for Americans, became a major factor in helping Hyundai break into the initial-consideration set of many new consumers. In a poor automotive market, the company’s market share is growing.

Invest in consumer-driven marketing

To look beyond funnel-inspired push marketing, companies must invest in vehicles that let marketers interact with consumers as they learn about brands. The epicenter of consumer-driven marketing is the Internet, crucial during the active-evaluation phase as consumers seek information, reviews, and recommendations. Strong performance at this point in the decision journey requires a mind-set shift from buying media to developing properties that attract consumers: digital assets such as Web sites about products, programs to foster word-of-mouth, and systems that customize advertising by viewing the context and the consumer. Many organizations face the difficult and, at times, risky venture of shifting money to fundamentally new properties, much as P&G invested to gain radio exposure in the 1930s and television exposure in the 1950s.

Broadband connectivity, for example, lets marketers provide rich applications to consumers learning about products. Simple, dynamic tools that help consumers decide which products make sense for them are now essential elements of an online arsenal. American Express’s card finder and Ford’s car configurator, for example, rapidly and visually sort options with each click, making life easier for consumers at every stage of the decision journey. Marketers can influence online word-of-mouth by using tools that spot online conversations about brands, analyze what’s being said, and allow marketers to post their own comments.

Finally, content-management systems and online targeting engines let marketers create hundreds of variations on an advertisement, taking into account the context where it appears, the past behavior of viewers, and a real-time inventory of what an organization needs to promote. For instance, many airlines manage and relentlessly optimize thousands of combinations of offers, prices, creative content, and formats to ensure that potential travelers see the most relevant opportunities. Digital marketing has long promised this kind of targeting. Now we finally have the tools to make it more accurate and to manage it cost effectively .

Win the in-store battle

Our research found that one consequence of the new world of marketing complexity is that more consumers hold off their final purchase decision until they’re in a store. Merchandising and packaging have therefore become very important selling factors, a point that’s not widely understood. Consumers want to look at a product in action and are highly influenced by the visual dimension: up to 40 percent of them change their minds because of something they see, learn, or do at this point—say, packaging, placement, or interactions with salespeople.

In skin care, for example, some brands that are fairly unlikely to be in a consumer’s initial-consideration set nonetheless win at the point of purchase with attractive packages and on-shelf messaging. Such elements have now become essential selling tools because consumers of these products are still in play when they enter a store. That’s also true in some consumer electronics segments, which explains those impressive rows of high-definition TVs in stores.

Sometimes it takes a combination of approaches—great packaging, a favorable shelf position, forceful fixtures, informative signage—to attract consumers who enter a store with a strong attachment to their initial-consideration set. Our research shows that in-store touch points provide a significant opportunity for other brands.

Integrating all customer-facing activities

In many companies, different parts of the organization undertake specific customer-facing activities—including informational Web sites, PR, and loyalty programs. Funding is opaque. A number of executives are responsible for each element, and they don’t coordinate their work or even communicate. These activities must be integrated and given appropriate leadership.

The necessary changes are profound. A comprehensive view of all customer-facing activities is as important for business unit heads as for CEOs and chief marketing officers. But the full scope of the consumer decision journey goes beyond the traditional role of CMOs, who in many companies focus on brand building, advertisements, and perhaps market research. These responsibilities aren’t going away. What’s now required of CMOs is a broader role that realigns marketing with the current realities of consumer decision making, intensifies efforts to shape the public profiles of companies, and builds new marketing capabilities.

Consider the range of skills needed to manage the customer experience in the automotive-insurance industry, in which some companies have many passive loyalists who can be pried away by rivals. Increasing the percentage of active loyalists requires not only integrating customer-facing activities into the marketing organization but also more subtle forms of organizational cooperation. These include identifying active loyalists through customer research, as well as understanding what drives that loyalty and how to harness it with word-of-mouth programs. Companies need an integrated, organization-wide “voice of the customer,” with skills from advertising to public relations, product development, market research, and data management. It’s hard but necessary to unify these activities, and the CMO is the natural candidate to do so.

Marketers have long been aware of profound changes in the way consumers research and buy products. Yet a failure to change the focus of marketing to match that evolution has undermined the core goal of reaching customers at the moments that most influence their purchases. The shift in consumer decision making means that marketers need to adjust their spending and to view the change not as a loss of power over consumers but as an opportunity to be in the right place at the right time, giving them the information and support they need to make the right decisions.

David Court is a director in McKinsey’s Dallas office, Dave Elzinga is a principal in the Chicago office, Susie Mulder is a principal in the Boston office, and Ole Jørgen Vetvik is a principal in the Oslo office.

The authors wish to acknowledge the contributions of Mary Ellen Coe, Jonathan Doogan, Ewan Duncan, Betsy Holden, and Brian Salsberg.

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Consumer Decision Making Process: a detailed analysis

The consumer decision making process is complex and involves all the stages from problem recognition to post purchase activities. It has been noted that “the childhood and the human’s development has a crucial impact on personal decision making process” (Sokolowski, 2011, p.1) and the framework of consumer decision making process is found to be addressed by the majority of authors who have addressed the topic of consumer behaviour .

All the consumers have their own needs in their daily lives and these needs make them make different decisions. These decisions can be complex depending on the consumer’s opinion about a particular product, evaluating and comparing, selecting and purchasing among the different types of product. Therefore, understanding and realizing the core issue of the process of consumer decision making and utilize the theories in practice is becoming a common view point by many companies and people.

There is a common consensus among many researchers and academics that consumer purchasing theory involves a number of different stages. Depending on the different factors and findings, numerous researchers and academics developed their own theories and models over the past years. However, according to Tyagi and Kumar (2004), although these theories vary slightly from each other, they all lead to almost the same theory about the consumer purchasing theory which states that it involves the stages of search and purchase of product or service and the process of evaluation the product or service in the post-purchase product.

Five Stage Model initially proposed by Cox et al. (1983) is considered to be one of the most common models of consumer decision making process and it involves five various stages. These stages are: recognition of need or problem, information search, comparing the alternatives, purchase and post-purchase evaluation. This simple model clearly illustrates and explains how the consumers make a purchasing decision.

Furthermore, Blackwell et al (2006) highlight the argument why this model is more precise and clear compared to the other similar models is that because this model’s core focus is on motivational factors which helps the user to understand the reasons behind the purchasing decision easier.       

 1. Problem/Need Recognition in Consumer Decision Making Process

Recognition of need or a problem is the first stage of the model. Arnould et al. (2002) specify need as the difference between an actual state and the desired state. According to Agwaral (2006) a need may be recognised due to internal or external stimuli. Hunger, thirst or other basic human needs can be specified as internal stimuli, whereas external stimuli may be caused by various formats of advertisement.

According to Bruner (1993) recognition of a problem arises in the situation where an individual realizes the difference between the actual state of affairs and desired state of affairs. Neal and Quester (2006) further state that the recognition of a problem or need depend on different situations and circumstances such as personal or professional and this recognition results in creation of a purchasing idea. For instance, consumer may recognize the need to buy a laptop when there is need to carry it use it in different places which is convenient compared to a desktop computer.

Solomon et al (2006) classifies the human needs into two different categories depending on their nature. The following categories are mentioned: psychological and functional or physical needs. The authors state that the psychological needs are the outcome of emotional feeling of consumers whereas functional or physical needs are usually the results of necessity.

According to Tyagi (2004) need recognition at various levels often occurs during the process of encountering with the product at various circumstances. In other words, Tyagi (2004) convincingly argues that an individual might not be aware of the need for a specific product until he or she encounters with the product as a result of engaging in ‘window-shopping’, media advertisements, or in a range of other circumstances.

The human need has no limit therefore; the problem recognition is a repetitive in nature. According to Maslow theory, human being is always dissatisfied, when an individual’s one need is satisfied another one will come out and this trend continues repetitively.

2. Information Search in Consumer Decision Making Process

The next stage of the model is information search. Once the need is recognized, the consumer is likely to search more product-related information before directly making a purchase decision. However, different individuals are involved in search process differently depending on their knowledge about the product, their previous experience or purchases or on some external information such as feedback from others.

Majumdar (2010) divides sources of information into four categories: personal, commercial, public and experiential sources. Members of family, friends, colleagues and others can be specified as personal sources of information. The level of influence of personal source of information is greater compared to other sources.

Commercial sources of information refer to marketing communication messages in various formats. Consumers are usually subjected to commercial sources of information via media advertisement, direct marketing, viral marketing, commercial events etc. Public sources of information refer to mass media in print, television, radio and digital formats. According to Batra and Kazmi (2008), consumer rating groups represent can be specified as another important public source. Experiential sources of information related to products and services relate to the possibilities of examining and using products and services for a specific duration of time.

Search of information process itself can be divided into two parts as stated by Oliver (2011): the internal search and external search. In internal search, the consumers compare the alternatives from their own experiences and memories depending on their own past experiences and knowledge. For example, searching for fast food can be an example for internal search because customers often use their knowledge and tastes to choose the right product they need rather than asking someone for an advice. On the other hand, external search ends to be for bigger purchases such as home appliances or gadgets. For instance, consumers who wish to buy new furniture or a mobile phone tend to ask friends’ opinion and advices or search in the magazines and media before making a purchasing decision.

Winer (2009) argues that with the enhancing role of internet in professional and personal lives of people, increasing numbers of individuals are turning to various resources in internet when searching for information about product categories or specific brands. The author specifically highlights the role of online user reviews and forums in terms of their significant impact upon information search stage of consumer decision making process among internet users.

Colleagues, peers, friends and family members are highlighted as another important source of information by Kahle and Close (2006). Moreover, according to Kahle and Close (2006) the nature of influence of peers, friends and family members upon information search and consumer decision making process in general depends on a range of factors such as the nature of relationships, the level of personal influence, the extent of ‘opinion leadership’ associated with specific individuals etc.

3. Evaluation of Alternatives in Consumer Decision Making Process

After gathering enough information at the first stage the consumer gets into comparing and evaluating that information in order to make the right choice. In this stage the consumer analyzes all the information obtained through the search and considers various alternative products and services compares them according to the needs and wants.

Evaluation of alternatives is usually conducted with the application of a set of criteria depending on consumer value preferences. Specifically, consumer value preferences might be oriented towards price, quality or additional features and capabilities of products and services (Blythe, 1997). Neal and Quester (2007) discuss this issue with a greater level of clarity by specifying quality, price and features as product attributes specifies the degree of importance of each attribute as the most important factor impacting the outcome of evaluation of alternatives.

Furthermore, according to Ha et al (2010), the process of evaluation of alternatives can sometimes be difficult, time consuming and full of pressure for a consumer. This is because it is quite hard to find an ideal product or service that satisfies the needs of the customer as there are numerous factors that hinder the consumer purchasing decision making process. For instance, when it comes to online hotel reservation or furniture purchasing evaluation process, it can be quite complex. Several factors and aspects need to be considered before making a purchasing decision. Factors such as age, culture, taste and budget have all impact on the evaluation process by the consumer. For example, when purchasing a furniture, the young people consider the factors such as convenience and price where as the old people are likely to consider the quality and design.

Moreover, celebrity endorsement is seen as another factor with great potential impact on evaluation of alternatives stages of consumer decision making process. Cant et al. (2010) explain the effectiveness of celebrity endorsements with perceived greatness people associate with their idols and the willingness and desire to become like their idols.

 4. Purchase Decision in Consumer Decision Making Process

Once the information search and evaluation process is over, the consumer makes the purchasing decision and this stage is considered to be the most important stage throughout the whole process. In this stage, the consumer makes decision to make a final purchase as he or she has already reviewed all the alternatives and came to a final decision point.

Importantly, purchase decision may result from evaluation of alternatives or such a decision might be made due to a set of situational factors such as effective point of sales marketing technique, and other aspects of environment in the point of sales. Evans et al. (2009) draw attention to impact of other people in the purchase decision. Specifically, according to Evans et al. (2009) the outcome of evaluation of alternatives may change even in last minutes before the purchase due to the impact of attitude of other people or a set of other factors.

Purchased further can be classified into three different types: planned purchase, partially purchase and impulse purchase (Kacen, 2002). Kacen’s view is further supported by Hoyer and Macinnis (2008) stating that there are a number of factors that can affect the purchasing process. For example, the desired product may not be available at the stock. In this case the purchase process is delayed and consumer may consider buying the product through online stores rather than visiting traditional physical stores.

According to Wiedmann et al. (2007) department store sales assistants play in integral role in terms of impacting consumer purchase decision in a positive way from a business point of view. At the same time Wiedmann et al. (2007) warn that this impact must not be done in a pushy manner, in which case it can prove to be counter-productive.

 5. Post-Purchase Evaluation in Consumer Decision Making Process

The final stage in the consumer decision making process is post-purchase evaluation stage. Many companies tend to ignore this stage as this takes place after the transaction has been done. However, this stage can be the most important one as it directly affects the future decision making processes by the consumer for the same product. Therefore this stage reflects the consumer’s experience of purchasing a product or service. This view is further supported by Ofir (2005) mentioning that the consumer decision making process is a repetitive action and a good experience is vital in reducing the uncertainty when the decision to purchase the same product or service is considered the ext time.

According to Webb (2009), product’s perceived performance in customers’ viewpoint can result in customer satisfaction and dissatisfaction, with direct and immense implications on the level of customer loyalty. The opinions of peers, friends and family regarding the purchases made is specified as one of the most important factors affecting the outcome of post-purchase evaluation by Perrey and Spillecke (2011). This point is further expanded by Trehan and Trehan (2011), according to whom peer opinions regarding product evaluations tend to impact customer level of satisfaction regardless of their level of objectivity.

Brink and Berndt (2009) also highlights the importance of the post-purchase evaluation stage. According to the authors, the consumer may either get satisfaction or dissatisfaction depending on the evaluation of the purchase and comparison of their own expectations. The outcome forms the experience of the customer and it this experience is believed to have a direct impact on the next decision of the consumer to purchase the same product from the same seller.

Simply, if the consumer is satisfies with the purchase it is likely that the purchase may be repeated while if they have a negative experience from the purchase it is unlikely that the consumer may make the decision to buy the same product from the same seller or even may not buy the product at all.

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Consumer Decision Making Process: A Comprehensive Guide

What is consumer decision making process.

The consumer decision-making process is a sequence of cognitive and emotional steps that a consumer goes through when identifying a need or want, gathering information, evaluating alternatives, making a purchase, and reflecting on their satisfaction with the product or service. This process is crucial in understanding consumer behavior and designing effective marketing strategies that cater to the needs and preferences of the target market.

There are several sources that define and explore the consumer decision-making process:

Engel, J. F., Blackwell, R. D., & Miniard, P. W. (1995). Consumer behavior. Fort Worth, TX: Dryden Press.

Engel, Blackwell, and Miniard’s widely cited book “Consumer Behavior” offers an in-depth analysis of the consumer decision-making process, along with other aspects of consumer behavior. The authors discuss various factors that influence each stage of the process and provide insights into how marketers can address these factors to create effective marketing campaigns. Consumer Behavior by Engel, Blackwell, and Miniard’s

Kotler, P., & Armstrong, G. (2020). Principles of Marketing. Upper Saddle River, NJ: Prentice Hall.

In their book “ Principles of Marketing, ” Kotler and Armstrong provide a comprehensive overview of the consumer decision-making process and its implications for marketing strategies. The authors explain the five stages of the process and emphasize the importance of understanding the factors that influence consumers’ decisions to create targeted and impactful marketing efforts.

Kotler, P., & Armstrong, G. (2020)

Solomon, M. R. (2018). Consumer Behavior: Buying, Having, and Being. Boston, MA: Pearson.

Michael R. Solomon’s “Consumer Behavior: Buying, Having, and Being” is another well-regarded source that delves into the consumer decision-making process. The book provides a detailed analysis of the process and offers insights into the various factors that shape consumers’ choices, including psychological, social, and cultural influences. Solomon, M. R. (2018). Consumer Behavior: Buying, Having, and Being. Boston

These sources offer a comprehensive understanding of the consumer decision-making process, emphasizing its importance in the field of marketing and consumer behavior. By studying these sources, marketers and businesses can better understand how consumers make their purchase decisions and develop marketing strategies that effectively address their needs and preferences.

Introduction to Consumer Decision Making Process

The consumer decision-making process plays a vital role in the success of any business . Understanding how consumers make their purchase decisions helps companies develop effective marketing strategies to target their potential customers and retain loyal ones. This comprehensive blog post delves into the stages of the consumer decision-making process, examining its different stages, and analyzing various factors that influence it. To provide an in-depth understanding, we will explore examples, case studies, relevant statistics, and research findings.

The Five Stages of the Consumer Decision-Making Process

The consumer decision-making process comprises five stages: problem recognition, information search, evaluation of alternatives, purchase decision, and post-purchase evaluation. Consumers tend to go through all these stages, albeit all the above stages, with varying degrees of intensity and involvement.

Problem Recognition

The consumer decision process begins with problem recognition, an internal or external stimulus that makes the consumer recognize a need or want. Internal stimuli might include personal experiences, feelings, or previous experiences, while external stimuli can come from marketing campaigns, personal sources gather information or brand ambassadors. The goal of marketers at this stage is to build brand awareness and trigger the consumer’s need for recognition.

Example: A consumer might feel thirsty on a hot day, prompting them to look for a refreshing beverage (internal stimulus), or they might see an advertisement for a new smartphone, sparking their interest in upgrading their old device (external stimulus).

Factors influencing Problem Recognition

Problem recognition is the first step in the decision-making process, where a consumer identifies a need or want. Factors influencing problem recognition include:

Internal stimuli: Personal experiences, emotions, or physiological states (e.g., hunger, thirst, or tiredness) can trigger problem recognition.

External stimuli: Marketing efforts, social influences, and environmental factors can prompt consumers to recognize a need or want.

Life events: Changes in personal circumstances, such as moving to a new city, getting married, or having a baby, can create new needs and wants.

Information Search

The information search stage is the next step in the consumer buying process. Once a need is recognized, the consumer gathers information to find solutions to their problem. Consumers might use search engines, personal sources, or previous customers’ reviews to collect data on potential products or services. Marketing efforts, such as targeted advertisements or content marketing, can assist consumers in this information stage.

Example: When searching for a new smartphone, a consumer might read online reviews, compare prices, and ask friends for their opinions.

Factors Influencing Information Search:

After recognizing a problem, consumers seek information about potential products or services to address their needs. Factors influencing consumer feelings during the information search stage include:

Perceived risk: The higher the perceived risk associated with a purchase (e.g., financial, functional, or social), the more extensive the information search is likely to be.

Prior knowledge: Consumers with prior knowledge or experience with a product or service may require less information search.

Personal characteristics: Individual differences, such as motivation, involvement, and cognitive style, can influence the extent of information search.

Available sources: The accessibility and credibility of information sources (e.g., online reviews, personal recommendations, or advertising) can affect the information search process.

Evaluation of Alternatives

After gathering information, the consumer evaluates alternatives based on various criteria, such as product price, features, quality, and brand reputation. Marketing campaigns aimed at highlighting a brand’s unique selling points can influence the consumer’s evaluation process. Consumers tend to evaluate alternatives by comparing their options to their internal criteria for evaluating alternatives and weighing the pros and cons of each.

Example: A consumer might compare prices of smartphones based on battery life, camera quality, processing power, and style options.

Factors Influencing Evaluation of Alternatives:

In this stage of customer journey, consumers compare and evaluate the gathered information to choose the best alternative. Factors influencing the evaluation of alternatives include:

Decision criteria: Consumers use various criteria, such as price, quality, features, and brand reputation, to evaluate alternatives.

Individual preferences: Personal preferences and values can influence the importance placed on different decision criteria.

Cognitive processes: Consumers may use different cognitive processes, such as heuristics or mental shortcuts, to  simplify the evaluation of alternatives.

Social influences: Opinions and recommendations from friends, family, or influencers can impact the evaluation process.

Purchase Decision

The consumer recognizes actual purchase decision is the penultimate stage in the decision-making process. The consumer makes their choice and buys the product or service. Factors such as product availability, delivery time, and the buying experience can affect the purchasing decision. Companies should focus on delivering a smooth, hassle-free buying process to convert potential customers into actual buyers.

Example: A consumer might decide to buy a smartphone from an online retailer that offers a competitively priced product with fast delivery.

Factors Influencing Purchase Decision

The purchase decision is the step where consumers make their final choice and buy the product or service. Factors influencing the consumer makes purchase decision include:

Availability: Limited availability or stock can create a sense of urgency and influence the purchase decision.

Buying experience: A smooth and hassle-free buying process can positively impact the purchase decision.

Sales promotions: Discounts, special offers, or incentives can make a product or service more attractive and influence the decision to buy.

External factors: Unforeseen circumstances or changes in personal situations can affect the purchase decision.

Post-Purchase Evaluation

The final stage in the consumer decision-making process is post-purchase evaluation. After the actual purchase itself, the consumer evaluates the product or service based on their personal experiences, comparing it to their initial expectations. A positive post-purchase evaluation can lead to customer satisfaction and loyalty, while a negative evaluation can result in buyer’s remorse, product returns, or negative word-of-mouth.

Example: A satisfied consumer might recommend the smartphone they purchased to a friend, becoming a brand ambassador and contributing to the company’s customer base.

Influencing Factors in the Consumer Decision-Making Process

Factors influencing Post Purchase Evaluation

Product performance: The actual performance of the product or service influences consumer satisfaction and future purchasing behavior.

Cognitive dissonance: Consumers may experience cognitive dissonance if the product or service does not meet their expectations, leading to dissatisfaction or regret.

Word-of-mouth: Positive or negative feedback from others can influence consumers’ post-purchase evaluation and their perception of the product or service.

After-sales support: Effective customer service, warranties, and return policies can impact consumer satisfaction and loyalty during the post-purchase evaluation stage.

Information Availability

The availability of information can significantly impact the consumer buying decision process. Consumers tend to make purchase decisions based on all the facts they can gather. Easy access to information, such as online reviews, makes it easier for potential customers to evaluate alternatives and make informed buying decisions.

Example: A consumer looking for a new pair of headphones might find numerous reviews and comparisons on various websites, helping them make a well-informed purchasing decision.

Social Influence

Personal sources, such as friends and family, can influence the consumer decision-making process. Consumers tend to trust the opinions of their close ones and often rely on their recommendations when making purchase decisions.

Example: A potential customer might decide to buy a particular brand of headphones because their friend recommended it, based on their positive experience.

Risk Management

Perceived risks, including financial, functional, psychological, and social risks, can influence the consumer buying process. Companies can address these risks by offering guarantees, warranties, or return policies, making potential customers more comfortable with their purchasing decision.

Example: A customer might feel more confident in buying an expensive product if the company offers a one-year warranty and a 30-day return policy.

Marketing Efforts

Marketing efforts, such as advertising, promotional offers, and public relations, can significantly impact the consumer decision process. Effective marketing campaigns can build brand awareness, create a positive brand image, and persuade potential customers to choose a specific product or service.

Example: A well-executed marketing campaign might convince a consumer to buy a new pair of sneakers from a specific brand, even if they had initially considered other alternatives.

Case Study: The Power of Influencer Marketing

In recent years, influencer marketing has become a powerful tool in shaping consumers’ buying decisions. By collaborating with social media influencers who have a strong following and credibility, brands can reach their customer and target market more effectively and persuasively.

A notable example is the collaboration between beauty brand Glossier and a wide range of influencers. Glossier’s influencer marketing efforts have been highly successful in creating a loyal customer base loyal customers, driving sales, and generating positive word-of-mouth.

In this case, influencers play a crucial role in the information search stage of the consumer decision-making process, as potential customers rely on their reviews and recommendations. Moreover, influencers can impact the customer searches and evaluation of alternatives, as their endorsements might persuade consumers to choose Glossier over competitors.

How do psychological, social, and cultural influences influence the Customer Journey?

Psychological, social, and cultural influences play a significant role in shaping the consumer decision-making process. These factors can impact the way consumers perceive, process information, evaluate different alternatives together, and make purchase decisions.

Psychological influences:

Perception: Consumers’ perception of a product or service is shaped by their sensory experiences and cognitive interpretation. This perception influences how they process information, evaluate alternatives, and make purchase decisions.

Motivation: The level of motivation or personal interest in a product or service can impact the extent of information search, evaluation, and decision-making. Highly motivated consumers are more likely to engage in a thorough decision-making process.

Learning: Past experiences and learning can impact consumers’ preferences, attitudes, and expectations, influencing their decision-making process. Consumers may rely on their previous experiences to evaluate and choose products or services.

Attitudes: Consumers’ attitudes towards a product, brand, or service can significantly impact their decision-making process. Positive attitudes may lead to favorable evaluations and purchase decisions, while negative attitudes can result in the opposite.

Social influences:

Family: Family members can influence consumers’ preferences, needs, and decision-making processes, as they often share similar values, experiences, and consumption habits.

Reference groups: Reference groups, such as friends, colleagues, or social media influencers, can impact consumers’ decision-making process through recommendations, opinions, or shared experiences. Consumers may be more likely to choose a product or service that has been endorsed by their reference groups.

Social roles and status: Consumers’ social roles and status can affect their decision-making process, as they may seek products or services that align with their position in society or their desired image.

Cultural influences:

Culture: Culture shapes consumers’ values, beliefs, and preferences, which in turn influence their decision-making process. Consumers from different cultural backgrounds may have distinct preferences, evaluation criteria, and decision-making styles.

Subculture: Subcultural groups within a society, such as ethnic or religious groups, can also influence consumers’ decision-making processes. Members of a particular subculture may share specific preferences, values, or consumption habits that impact their purchase decisions.

Social class: Social class can impact consumers’ decision-making processes, as individuals from different social classes may have varying levels of resources, needs, and preferences. Consumers from higher social classes may prioritize luxury, quality, or exclusivity, while those from lower social classes may focus more on affordability and functionality.

Understanding the consumer decision-making process is crucial for businesses looking to attract and retain customers. This in-depth analysis of the buyer decision process, along with relevant examples, case studies, and research findings, provides valuable insights for companies aiming to develop effective marketing strategies.

By acknowledging the five stages of the consumer decision-making process – problem recognition, information search, evaluation of alternatives, the purchase decision, and post-purchase evaluation – businesses can tailor their marketing efforts to address the unique needs of consumers at each stage. Additionally, considering factors such as information availability, social influence, risk management, and marketing efforts to previous customers, companies can create a comprehensive approach to target their desired market and ensure customer satisfaction.

In the ever-evolving landscape of consumer behavior, staying informed and adaptable is essential for businesses to succeed. By leveraging the insights provided in this blog post, companies can create informed marketing stra

Samrat is a Delhi-based MBA from the Indian Institute of Management. He is a Strategy, AI, and Marketing Enthusiast and passionately writes about core and emerging topics in Management studies. Reach out to his LinkedIn for a discussion or follow his Quora Page

Consumer Decision-Making Process: Case Study

Introduction, steps of consumer decision-making process, the influence of cultural norms and values on purchasing, environmental advocacy influence, price prioritization.

At different points in life, people make expensive purchases, which necessitate rational decision-making. My most recent big-ticket purchase was a smartphone, Samsung Galaxy s20 Plus 5g. As a low-income African American single mother of two children, I had many factors influencing my decision when making this purchase. The combination of price, convenience, social and cultural relevance, and brand reliability were the key impactful determinants. In this case study, I will analyze my recent purchase based on a consumer decision-making model to evaluate certain factors’ scope and level of impact.

In marketing, a significant level of attention is paid to analyzing how consumers make their decisions when shopping for goods. Despite various consumer decision-making models, a traditional five-stage model of consumer purchasing behavior is most illustrative of the essential steps in this process (Stankevich, 2017). These steps include needing recognition, information search, evaluation of alternatives, purchase, and postpurchase behavior.

Firstly, at the stage of need recognition, I analyzed why my old smartphone did not serve its purpose to the fullest of my expectations. I understood that it lacked the latest software, it did not support some of the newest technological features, which limited my app use, and it was out of order occasionally, thus blocking my communication opportunities. Therefore, I needed a reliable and up-to-date device that would have the latest software and process online data fast for internet browsing and social media use.

Secondly, at the information search stage, I referred to my friends and social media platforms where bloggers shared their reviews of some phones available in the market. In addition, I browsed the internet websites to read feedback about the best options in the market, as well as visited the online stores to see the specifications and prices. Thirdly, when evaluating alternatives, I was considering iPhone 11 and Samsung Galaxy Note 10+ alongside Samsung Galaxy s20 Plus 5g. I compared and contrasted their prices, features, namely processors, camera quality, design, convenience, memory, and reviews on long-term use.

The alternative that fitted my needs and buying capabilities best was Samsung Galaxy s20 Plus 5g. Thus, in the fourth stage, when I decided to purchase the chosen smartphone, I faced two choices, which were buying it online or at a brick-and-mortar store. I decided to go to a physical store to reduce the waiting time, test the device, and ensure that the item is original and of the promised quality. Finally, during postpurchase, I shared my review online based on the experiences I had when using the smartphone.

The cultural environment, especially the US society and culture, produces consumerism in purchasing behavior; people think about how their social status would be affected by the purchase. Although consumers commonly adhere to rational thinking when making a big-ticket purchase, they are implicitly and explicitly exposed to cultural and social influence (Shabrin et al., 2017). When making my decision, I depended on the types of phones my friends and peers owned, as well as the way in which my daily life would become better when using a high-quality device. The cultural norms of convenience and satisfaction with daily life significantly influenced my decision-making process when purchasing a smartphone. Although it was slightly over my anticipated price range, I was aiming at long-term use, which validated this investment.

Environmental issues have not been a decisive factor in my purchasing decision-making. The Samsung company might address the environmental protection in their production and marketing, but for me, it was one of the least significant determinants. Commonly, sustainability in production adds value to the product and makes it more costly, which was an undesirable issue for me. However, at some point in my decision-making process, I validated my inclination toward more pricy and reliable devices by their long-term use, which will ensure less waste in the long-term perspective. Thus, my personal environmental concern but not the company advocacy played a pivotal role.

Since I represent a low-income population, prince considerations were of significant relevance when evaluating alternatives and making a final purchasing decision. When considering the cultural and environmental issues, the price would supersede them at the point where the cost of purchase would equal or exceed my monthly income. Since I am a single mother, I need to balance my expenses to provide for my children. Therefore, price plays a decisive role in my consumer behavior.

The modern consumerist world presents buyers with an abundance of products. When making a decision on a purchase, especially an expensive one, consumers take into consideration many factors. The process of purchasing decision-making consists of such steps as need identification, a search of information, alternative analysis, purchase, and postpurchase. At each of these stages, social, cultural, and environmental considerations influence one’s decision. As the analyzed case study demonstrates, while cultural norms and values impact purchasing, socio-economic status plays a decisive role.

Shabrin, N., Khandaker, S., Kashem, S. B. A., Hie, C. K., & Susila, T. (2017). Factors affecting smartphone purchase decisions of generation-Y. Journal of Contemporary Issues in Business and Government, 23 (1), 47-65.

Stankevich, A. (2017). Explaining the consumer decision-making process: Critical literature review. Journal of International Business Research and Marketing, 2 (6), 7-14.

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Definition and examples of the consumer decision-making process

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What is the consumer decision making process

The consumer decision-making process involves five basic steps. This is the process by which consumers evaluate making a purchasing decision. The 5 steps are problem recognition, information search, alternatives evaluation, purchase decision and post-purchase evaluation.

5 steps of the consumer decision making process

• Problem recognition : Recognizes the need for a service or product
• Information search : Gathers information
• Alternatives evaluation : Weighs choices against comparable alternatives
• Purchase decision : Makes actual purchase
• Post-purchase evaluation : Reflects on the purchase they made

The consumer decision-making process can seem mysterious, but all consumers go through basic steps when making a purchase to determine what products and services will best fit their needs. 

Think about your own thought process when buying something—especially when it’s something big, like a car. You consider what you need, research, and compare your options before making the decision to buy. Afterward, you often wonder if you made the right call. 

If you work in sales or marketing, make more of an impact by putting yourself in the customer’s shoes and reviewing the steps in the consumer decision-making process.

Steps in the consumer decision process

Generally speaking, the consumer decision-making process involves five basic steps.

1. Problem recognition

The first step of the consumer decision-making process is recognizing the need for a service or product. Need recognition, whether prompted internally or externally, results in the same response: a want. Once consumers recognize a want, they need to gather information to understand how they can fulfill that want, which leads to step two.

But how can you influence consumers at this stage? Since internal stimulus comes from within and includes basic impulses like hunger or a change in lifestyle, focus your sales and marketing efforts on external stimulus. 

Develop a comprehensive brand campaign to build brand awareness and recognition––you want consumers to know you and trust you. Most importantly, you want them to feel like they have a problem only you can solve.

Example: Winter is coming. This particular customer has several light jackets, but she’ll need a heavy-duty winter coat if she’s going to survive the snow and lower temperatures.

2. Information search

When researching their options, consumers again rely on internal and external factors, as well as past interactions with a product or brand, both positive and negative. In the information stage, they may browse through options at a physical location or consult online resources, such as Google or customer reviews.

Your job as a brand is to give the potential customer access to the information they want, with the hopes that they decide to purchase your product or service. Create a funnel and plan out the types of content that people will need. Present yourself as a trustworthy source of knowledge and information. 

Another important strategy is word of mouth—since consumers trust each other more than they do businesses, make sure to include consumer-generated content, like customer reviews or video testimonials, on your website.

Example: The customer searches “women’s winter coats” on Google to see what options are out there. When she sees someone with a cute coat, she asks them where they bought it and what they think of that brand.

3. Alternatives evaluation

At this point in the consumer decision-making process, prospective buyers have developed criteria for what they want in a product. Now they weigh their prospective choices against comparable alternatives.

Example: The customer compares a few brands that she likes. She knows that she wants a brightly colored coat that will complement the rest of her wardrobe, and though she would rather spend less money, she also wants to find a coat made from sustainable materials.

4. Purchase decision

This is the moment the consumer has been waiting for: the purchase. Once they have gathered all the facts, including feedback from previous customers, consumers should arrive at a logical conclusion on the product or service to purchase.

If you’ve done your job correctly, the consumer will recognize that your product is the best option and decide to purchase it.

Example: The customer finds a pink winter coat that’s on sale for 20% off. After confirming that the brand uses sustainable materials and asking friends for their feedback, she orders the coat online.

5. Post-purchase evaluation

This part of the consumer decision-making process involves reflection from both the consumer and the seller. As a seller, you should try to gauge the following:

• Did the purchase meet the need the consumer identified?
• Is the customer happy with the purchase?
• How can you continue to engage with this customer?

Remember, it’s your job to ensure your customer continues to have a positive experience with your product. Post-purchase engagement could include follow-up emails, discount coupons, and newsletters to entice the customer to make an additional purchase. You want to gain life-long customers, and in an age where anyone can leave an online review, it’s more important than ever to keep customers happy.

Tools to better understand your customer

Putting yourself in the customer’s shoes can help you steer consumers towards your product. Here are some tools to help you analyze their decision-making process and refine your brand marketing and sales tactics.

Customer journey map

A customer journey map visualizes a hypothetical customer’s actions. Use it to empathize with your customers as they go through a specific process or try to complete a purchase. Map out the actions the customer is likely to take.

Learn how to make a customer journey map to understand the decision-making process for your product/service.

Empathy map

Empathy maps help teams understand the customer’s mindset when dealing with a product or service. They can be used for personas or specific customer types. Empathy mapping is often most helpful at the beginning of a new project. Collaborate as a team to quickly get inside the heads of your customers during every step of product development, testing, and release.

Learn how empathy maps work so you can understand your customers better and make customer-oriented decisions .

User personas

Based on user research or past user interactions, user persona cards construct fictional or composite personas that break down and organize your data into distinctive types of users. Build a more human picture of your users and understand your user base better by creating user personas for the various types of users for your product or service.

Understanding the consumer decision-making process is key if you want to attract more customers and get them to make that crucial purchase. Use this process and the tools above to tune in to consumers and genuinely understand how to reach them.

Visualize your own customer journey map.

Lucidchart, a cloud-based intelligent diagramming application, is a core component of Lucid Software's Visual Collaboration Suite. This intuitive, cloud-based solution empowers teams to collaborate in real-time to build flowcharts, mockups, UML diagrams, customer journey maps, and more. Lucidchart propels teams forward to build the future faster. Lucid is proud to serve top businesses around the world, including customers such as Google, GE, and NBC Universal, and 99% of the Fortune 500. Lucid partners with industry leaders, including Google, Atlassian, and Microsoft. Since its founding, Lucid has received numerous awards for its products, business, and workplace culture. For more information, visit lucidchart.com.

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New Google research: What we now know about 'decoding' consumer decision-making

Jonny Protheroe and Sian Davies have been ‘decoding’ consumer decision-making since 2019. Their latest research reveals where — and how — marketers can experiment and iterate to increase customer confidence and sales in the “messy middle” of the online purchase journey.

The evolution of the internet has changed a lot faster than the way consumers think and make decisions. This means that people's shopping needs keep changing as they try to keep up with the proliferation of choice and cut through the digital noise. In fact, about a third of consumers globally are now spending more time making decisions and considering more brands, stores, and retailers. 1

Google and The Behavioural Architects have been working together for several years now to understand how people decide what to buy while they’re in the messy middle of their purchase journey. Our first report was published in 2020 — and the findings remain hyper-relevant to this day.

But brands want to understand how they can apply these insights into their own campaigns and content. That’s where “Decoding Decisions: Marketing in the messy middle” comes in. 2 The new report builds on earlier findings and is the result of three more years of analysis into the behaviours that shape consumer decision-making.

It reveals how behavioural science principles can be applied in real-world marketing scenarios — at scale. And answers some of the biggest questions we’ve heard since we first began making sense of the messy middle.

How marketers can influence the messy middle

To ensure our research is as helpful and actionable as possible, we’ve focused our findings on three key areas where marketers have the power to experiment and iterate:

• Search: Many people turn to Google Search in their purchase journeys. However, competing against big names with big budgets can be a challenge. Our experiments with Search ads show that smart applications of behavioural science can help even second- and third-ranked brands win a higher proportion of ad clicks.
• Content: Brand websites are a valuable asset in the consumer decision-making process. If shoppers don’t feel confident about a purchase, they won’t click ‘buy’. Our research gives practical guidance on how to boost your website content with behavioural science principles to increase both customer confidence and sales.
• Points of sale: We discovered that shoppers are more willing to switch their preferred choice of retailer than their preferred choice of product brand, particularly where price is a factor. But our findings suggest that even simple applications of behavioural science can have as big an impact on consumer decision-making as offering a 10% discount .

People were foraging for information long before online shopping, and long before there was an internet. And many of the mental processes used by our ancestors persist today. But what we’re looking for and where we’re looking for it can shift in an instant.

That’s why this report explores the information-seeking behaviours marketers need to identify, understand, and address. This allows them to quickly adapt to new and changing demand — and provide consumers with the products and experiences they seek.

Download “Decoding Decisions: Marketing in the messy middle” to learn how you can apply behavioural science principles in real-world marketing scenarios — at scale.

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1 Ipsos Essentials COVID-19 tracker, AU, BR, CA, CN, FR, DE, IN, IT, JP, MX, ZA, KR, ES, U.K., U.S., n=500–1,000 online consumers per market age 18–74 in U.S. and Canada and 16–74 in others, 8. Sept. 2022–11 Sept. 2022. 2 Google/The Behavioural Architects, U.K., Decoding Decisions: Marketing in the messy middle, March 2023.

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Marketing Reading: Consumer Behavior and the Buying Process

By: John T. Gourville, Michael I. Norton

Core Curriculum Readings in Marketing cover fundamental concepts, theories, and frameworks in marketing. For classroom use in higher education, this Reading is accompanied by a Teaching Note, test…

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The latest revision (December 2019) features updated examples to reflect changing industry trends and new ad campaigns.

Core Curriculum Readings in Marketing cover fundamental concepts, theories, and frameworks in marketing. For classroom use in higher education, this Reading is accompanied by a Teaching Note, test bank, and exhibit slides. "Consumer Behavior and the Buying Process" describes and analyzes 4 frameworks for understanding how consumers make decisions: cognitive versus emotional, high-involvement versus low-involvement, optimizing versus "satisficing," and compensatory versus noncompensatory decision making. This Core Curriculum Reading then presents the activities that occur during the 3 phases in the consumer buying process: pre-purchase, purchase, and post-purchase. It also analyzes consumer decision-making units, including roles played within such units, such as buyer, influencer, gatekeeper, and approver. The Reading includes an in-depth example of how a pharmaceutical company analyzed decision-making processes and decision-making units to develop marketing campaigns for a new product. It concludes with an exploration of 3 developments that profoundly affect consumers' decision-making process and units: social media, co-creation and customer involvement, and "conscience" marketing. Ultimately, this Reading prepares students to become marketers who can design effective advertising and marketing campaigns for products and services.

The Reading also includes links to 3 videos: "United Breaks Guitars," "Use Social Media to Listen to Customers," and "Harnessing Creativity." For classroom use in higher education, this Reading is accompanied by a Teaching Note, test bank, and exhibit slides.

Learning Objectives

Describe and analyze 4 frameworks for understanding how consumers make decisions.

Explain the activities in which consumers engage during the 3 phases of the buying process: pre-purchase, purchase, and post-purchase.

Identify what a decision-making unit is and describe several roles often played within decision-making units.

Analyze a case study to identify how the featured organization used insights about the consumer decision-making process and decision-making units to design a marketing campaign for a new product.

Examine how social media, co-creation and customer involvement, and "conscience" marketing are reshaping consumers' decision-making process and decision-making units, and analyze these developments' implications for marketers.

Jun 30, 2014 (Revised: Dec 19, 2019)

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Harvard Business Publishing

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3.3 The Consumer Purchasing Decision Process

Learning outcomes.

By the end of this section, you will be able to:

• 1 Explain the first stage in the consumer purchasing decision process.
• 2 Summarize the second stage in the consumer purchasing decision process.
• 3 Describe the third stage in the consumer purchasing decision process.
• 4 Discuss the fourth stage in the consumer purchasing decision process.
• 5 Explain the fifth and final stage in the consumer purchasing decision process.

Consumer Decision Process

This chapter has examined many of the factors that influence consumer buying behavior, but behind the visible act of making a purchase lies an important decision process that takes place before, during, and after the purchase of a product or service. Figure 3.12 shows the five stages of the consumer decision process .

A buyer passes through five stages of the consumer decision process when making choices about which products or services to buy. Let’s examine each, starting at the beginning.

Stage 1: Need Recognition

The buying process starts when you sense a difference between your actual state and your desired state. This is referred to as problem awareness or need recognition. You might become aware of a need through internal stimuli (such as feeling hungry or thirsty when you’re on a long road trip) or external stimuli (such as passing a bakery and smelling the wonderful aroma of cookies baking).

Sometimes recognizing the problem or need is easy. You’ve run out of toilet paper or milk. But other times recognizing the problem or issue is more complicated. For example, think about this first stage in terms of your decision to enroll in college. What was the stimulus that triggered your interest in attending college? Are you a working adult who has recognized that upward advancement in your company won’t happen without possessing a college degree? Have you long aspired to be an entrepreneur, and you wanted to get some business and marketing courses under your belt so that you’re better prepared for the challenges of entrepreneurship? Perhaps a career in marketing has been on your internal radar since high school, and you’ve decided to take the plunge and get your degree in marketing. Or perhaps, after graduating from high school, your parents gave you an ultimatum—either find a job or enroll in college.

Stage 2: Information Search

Now that you’ve identified the problem or need, you’ll be inclined to search for more information. There are two different search states. The milder search state is called “heightened attention,” in which you become more receptive to information about the product or service. The stronger search state is called “active information search,” in which you might do some research about the product or service on the Internet (referred to as an internal search), ask friends and/or family members their opinions (what’s known as an external search), or even visit stores to view and touch the product (called an experiential search).

Keep in mind, of course, that not all needs/problems identified in Stage 1 will require this second stage. If you’ve run out of bread or toilet paper, you’re probably not going to do an information search; rather, you’ll just go to the store to buy what you need, and your information search may be as simple as checking prices at the grocery store to see if your favorite brand is available or another brand is on sale. However, purchase decisions of more consequence will usually trigger an information search of some type.

Again, consider the process you went through in deciding which college to attend. What sources of information did you use to find out about the colleges or universities you considered attending? Did you look at their websites, talk with friends or family who attended that school, or perhaps even visit the campus and meet with an admissions counselor?

Stage 3: Evaluation of Alternatives

Consumers are said to view a product or service as a “bundle of product attributes,” and you evaluate several attributes of a product or service in reaching your purchase decision. For example, if you’re buying a smartphone, you’ll consider factors such as battery life, speed, storage capacity, or price. If you’re booking a hotel, you’ll probably consider its location, cleanliness, free Wi-Fi, whether it has a free breakfast in the morning or a pool, and of course price.

What bundle of attributes did you use when evaluating your college alternatives? You may have considered factors such as location, size of the campus, whether the school had the program of study you wanted, if it had online learning, and cost.

Stage 4: Purchase Decision

This stage involves actually reaching a decision on the purchase of the product or service. One way people navigate all the information, evaluations, and choices in their purchase decision is to use heuristics —mental shortcuts or “rules of thumb.” Heuristics are types of preexisting value judgments that people use to make decisions.

For example, do you believe that the more expensive product is always of higher quality than the lower-priced product? That’s known as the price = quality heuristic. Brand loyalty is another heuristic people use in reaching their purchase decisions. For example, do you eat cereal? Do you always buy the same brand, or do you buy whatever’s on sale or a brand for which you have a coupon? Country of origin is still another heuristic. Given a choice, do you prefer to buy products made in the United States versus products made in other countries?

How did you make your purchase decision to enroll in your college or university? What heuristics did you use?

Stage 5: Post-Purchase Evaluation

After purchasing the product or service, you’ll experience either satisfaction or dissatisfaction. You may have second thoughts after making a purchase decision, and these doubts lead to cognitive dissonance , or buyer’s remorse—tension caused by uncertainty about the correctness of your decision. This may lead you to search for additional information to confirm the wisdom of your decision in order to reduce that tension.

What determines if a consumer is very satisfied, somewhat satisfied, or dissatisfied with his or her purchase? Satisfaction is a function of the closeness between the buyer’s expectations and the product’s perceived performance. If the product’s performance falls short of expectations, you’ll be dissatisfied. If the product’s performance meets your expectations, you’ll be satisfied, and if the product’s performance exceeds your expectations, you’ll be very satisfied.

Think about the purchase decision you made when you decided to enroll in your college or university. Are you very satisfied, satisfied, or dissatisfied with your decision? Refer to Table 3.1 for a summary of the five stages of the consumer decision process.

Careers In Marketing

You are also a consumer.

Learn about the five stages of the consumer decision process in this video from Open Up (Upatras) Entrepreneurship and this article from Business Study Notes .

GWI , a company that researches global consumer thinking, published its 2022 consumer trends report , which showed that consumers’ needs and priorities have shifted. Read the report and see if you find the same results for yourself. Have your priorities and needs changed since the pandemic hit? What are the other factors influencing your needs assessment?

Several tools can help you with a personal needs assessment. Practice your marketing skills on yourself by trying this needs assessment worksheet . This personal awareness will help you in many ways, including finding the right job that best fits your interests and abilities. Also take a few assessments and compare your results to better identify jobs worth learning more about. There are several free career aptitude tests to try:

• 123 Career Test
• Interest Assessment
• Work Values Matcher
• A Personality Color Test

In addition to career aptitude tests, personality tests assess your skill level and your ability to succeed in a career. Try a few of these:

• Typology Central Jung Personality Test
• Myers-Briggs Type Indicator

The Balance Careers site also provides a wealth of resources on additional aptitude, personality, talent, and preemployment tests. It’s worth your time to dive into this information to help you identify which career might be your best fit.

Knowledge Check

It’s time to check your knowledge on the concepts presented in this section. Refer to the Answer Key at the end of the book for feedback.

• Need recognition
• Information search
• Evaluation of alternatives
• Purchase decision
• Problem identification
• Post-purchase evaluation
• It is the mental conflict that occurs when a person’s behaviors and beliefs do not align.
• It is a mental shortcut that allows people to solve problems and make judgments more quickly and efficiently.
• It is a function of the closeness between your expectations of a product or service and its actual performance.
• It is the process of assigning the cause of behavior to either internal or external characteristics.

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Want to cite, share, or modify this book? This book uses the Creative Commons Attribution License and you must attribute OpenStax.

Access for free at https://openstax.org/books/principles-marketing/pages/1-unit-introduction

• Authors: Dr. Maria Gomez Albrecht, Dr. Mark Green, Linda Hoffman
• Publisher/website: OpenStax
• Book title: Principles of Marketing
• Publication date: Jan 25, 2023
• Location: Houston, Texas
• Book URL: https://openstax.org/books/principles-marketing/pages/1-unit-introduction
• Section URL: https://openstax.org/books/principles-marketing/pages/3-3-the-consumer-purchasing-decision-process

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BUS602: Marketing Management

The Consumer's Decision Making Process

Read these sections on the consumer purchase decision process. Consider the degree of involvement in a purchase, and how this would apply to some, but not all purchasing decisions.

Discussion Questions and Activities

Discussion questions.

• Why do people in different cultures buy different products? If you've been in other countries, think about the types of vehicles you've seen there, and if possible discuss these with your class.  Why are they different, and how do they better meet buyers' needs in those countries? What types of cars do you think should be sold in the United States today?
• What is your opinion of companies like Google that gather information about your browsing patterns? What advantages and drawbacks does this pose for consumers? If you were a business owner, what kinds of information would you gather on your customers and how would you use it?
• Are there any areas in which you consider yourself an opinion leader? What are they? How are companies getting information about opinion leaders?
• What purchasing decisions have you been able to influence in your family and why? Is marketing to children a good idea? If not, what if one of your competitors were successful in doing so? Would it change your opinion?
• Name some products that have led to postpurchase dissonance on your part. Then categorize them as high- or low-involvement products.
• Describe the decision process for impulse purchases at the retail level. Would they be classified as high- or low-involvement purchases?
• How do you think the manufacturers of products sold through infomercials reduce postpurchase dissonance?
• Explain the relationship between extensive, limited, and routine decision making relative to high- and low-involvement decisions. Identify examples of extensive, limited, and routine decision making based on your personal consumption behavior.
• Why is understanding consumer behavior so important for companies? Think of examples where you do not think companies understood their consumers.
• Select three advertisements and describe the needs identified by Abraham Maslow that each ad addresses. Find an international version of an advertisement for one of the products. What differences do you detect in the international version of the ad?
• If possible, visit an ethnic part of your town that differs from your own ethnicity(ies). Walk around the neighborhood and its stores. What types of marketing and buying differences do you see? 
• Using Maslow's hierarchy of needs, identify a list of popular advertising slogans that appeal to each of the five levels.
• Identify how McDonald's targets both users (primarily children) and buyers (parents, grandparents, etc.). Provide specific examples of strategies used by the fast-food marketer to target both groups. Make it a point to incorporate Happy Meals and Mighty Kids Meals into your discussion.

Neuromarketing: An Interdisciplinary Approach to Studying Consumer Decision-Making Process

Original Research 02 May 2023 Automatic facial coding predicts self-report of emotion, advertisement and brand effects elicited by video commercials T. Tim A. Höfling  and  Georg W. Alpers 2,418 views 1 citations

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Consumer Behaviour: Workshop – Market Segmentation Example 🙂 + How Much Money is Enough?

Consumer Decision-Making Process: In-Depth Analysis & Book

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“Consumer Behaviour” is a huge topic and has a significant impact on businesses. In fact, knowing how consumers behave is the most critical aspect of doing business.

However, studying consumer behaviour can help us become better – more equipped and conscious consumers ourselves and this comes with a huge set of benefits.

In the previous post, I made an introduction to consumer behaviour which is a multidimensional science that captures the dynamic journey of consumers.

Now, we are diving deeper into this science to examine the consumer decision-making process , that is, a series of steps (stages) that consumers go through when considering and making purchases of goods and services. 

In a nutshell, understanding this process helps businesses craft innovative marketing strategies, tailor their marketing efforts to meet consumers’ needs at each stage and build long-term relationships with their customers. On the other hand, studying consumer behaviour equips individuals (us) with the tools to make conscious, well-informed, and responsible consumer choices. It allows us to navigate the marketplace more effectively while considering our own needs and values.  Additionally, it fosters a sense of empowerment and awareness that can lead to more meaningful and satisfying consumer experiences.

Are you ready?

Consumer Decision-Making Process

In-depth analysis & book, video overview.

Quick Navigation

The decision-making consumer.

• Factors that Influence Consumer Behaviour

Consumer Decision-Making Process Overview

Various consumer behaviour models, consumer behaviour models significance, economic model, passive model, cognitive model, emotional model, behavioural economics model, the disadvantages of consumer behaviour models, the input-process-output factors, the general model of the consumer’s purchasing behaviour, need arousal, information processing and brand evaluation.

• Extended Decision-Making
• Limited Decision-Making
• Mechanical or Automatic Decision-Making (by habit)

Decision-Making Rules

• Complete Example of Applying Decision Rules

Implications for Marketing Strategy

Recent trends.

• Actionable Takeaways

Conclusion: Unlocking Consumer’s Mind

The book: the consumer decision-making journey.

The effectiveness of marketing is evaluated when consumers choose to buy or reject a product. Marketers are keen on understanding the process consumers go through to make purchase decisions. For a decision to be made, consumers need to have choices among alternatives, including the option not to buy.

There are many theories of consumer decision-making. The variety of patterns that emerge is due to the assumptions that researchers make about the nature of people. The various “models of man/consumer” (such as economic, passive, cognitive, and emotional) describe consumers and the decision-making processes they follow in very different ways.

Consumer behaviour is influenced by a wide array of factors:

• Demographic Factors.
• Geographic Factors.
• Socioeconomic Factors: social class, cultural background, education level, occupation, income, family structure, social influences, values and beliefs, leisure activities, digital engagement.
• Psychological and Psychographic Factors: motives, needs and desires, personality, attitudes, lifestyle (activities, interests, opinions).
• Behavioural Characteristics: volume usage, usage habits, purchasing behaviour and preferences, purchasing history, purchase reasoning and drivers, purchase frequency, types of products, loyalty status, preferences, price sensitivity, usage occasion, benefit expectations, readiness stage, user status, media consumption, brand interactions, interactions with apps/websites/businesses.
• Industrial Market Insights.
• Language: keywords, idioms, colloquial expressions.
• Influences: social, interpersonal, situational.
• Global Market Insights.
• Involvement/Engagement Level: personal relevance, functional importance, symbolic significance, emotional appeal, hedonic value, brand importance, perceived risk, interest and passion, situational and environmental cues, past experiences, digital and social influences, cultural and societal influences.
• Perception: selective perception, the memory system, sensation, consumer’s portray/imagery, product (image, quality, price-quality ratio, pricing, packaging, distribution, positioning/placement), store image, web presence, advertisements, multimedia.
• Cognitive Biases and Heuristics.
• Emotional Influences.
• Needs and Pain Points.
• Limitations.
• Goals and Aspirations.
• Innovation and Trends.
• Technology.
• eCommerce, Traditional Retail.
• Environmental Concerns.
• Ethical considerations.
• Social Responsibility and Corporate Citizenship.
• Marketing Strategy, Communications, Advertising, and Sales.
• Customer Service & Support.
• Brand Loyalty and Advocacy.
• External Influences: media, peer pressure, and more.

These factors interact in complex ways, making the study of consumer behaviour a multidisciplinary field that combines elements of psychology, sociology, cultural anthropology, economics, and marketing to understand why and how people make the choices they do.

I’ll be analysing these factors extensively in this series of “consumer behaviour” (various articles and guides – see below in the conclusion).

• According to eMarketer via LinkedIn , global e-commerce sales reached $4.28 trillion in 2020, representing 27.6% growth compared to the previous year.
• According to eMarketer , in 2022, worldwide eCommerce sales will exceed $5 trillion for the first time. After two years of unusual growth patterns, we expect worldwide retail and eCommerce spending to continue to grow through 2025.
• A survey by GlobalWebIndex found that 54% of social media users research products on social platforms
• BrightLocal’s Local Consumer Review Survey revealed that 87% of consumers read online reviews for local businesses and 79% trust online reviews as much as personal recommendations.
• Statista reported that mobile e-commerce sales accounted for 72.9% of total e-commerce sales in 2021, emphasizing the importance of mobile-friendly shopping experiences.

These statistics showcase the significant impact of eCommerce, social media, and online reviews on consumer behaviour. They highlight the need for businesses to have a strong online presence and to actively manage their reputation in the digital space.

eCommerce sales will exceed #5 Trillion for the first time

54% of social media users research products on social platforms, 87% of consumers read online reviews for local businesses.

The consumer decision-making process is a series of steps that individuals go through when considering and making purchases. Here’s an overview of the typical consumer decision-making process:

• Problem Recognition/Need Arousal
• Information Search
• Preferences
• Evaluation of Alternatives
• Purchase Decision
• Post-Purchase Evaluation
• Post-Purchase Behaviour
• Loyalty and Advocacy

It’s important to note that not all consumers go through every stage for every purchase. The extent and depth of each stage can vary based on factors like the complexity of the decision, the individual’s level of involvement, and the type of product or service in question.

Understanding this process helps businesses tailor their marketing efforts to meet consumers’ needs at each stage and build long-term relationships with their customers.

Researchers in consumer behaviour and psychology have developed various models of consumer decision-making, often based on different assumptions about human behaviour.

Consumer behaviour models serve various purposes in marketing, research, and business strategy. Here’s how they are commonly used:

• Understanding Consumer Behaviour
• Market Segmentation
• Product Development
• Advertising and Promotion
• Price Determination
• Customer Satisfaction
• Competitive Analysis
• Forecasting and Planning
• New Market Entry
• Risk Assessment
• Customer Retention
• Decision Support

These are just a few areas where the study of consumer behaviour can help a business.

It is a model that describes the consumer as a completely rational being (rational consumer) who objectively judges and ranks each alternative product and chooses the one that gives them the greatest value. The model assumes that the consumer knows all brands of the product as well as their marginal utilities.

• Assumption: Consumers are rational decision-makers who seek to maximize utility or satisfaction while minimizing costs.
• Key Characteristics: Consumers carefully weigh the benefits and costs of each choice and make decisions based on a rational assessment of available information.
• Example: Economic models are often used in classical microeconomics to explain how consumers allocate their budgets among different goods and services.

An example:

Budgeting for a Vacation:

• Situation: A family plans a vacation to a popular tourist destination.
• Economic Model Behaviour: The family sets a budget for the trip, taking into account expenses such as transportation, accommodation, meals, and entertainment.
• Decision-Making Process: They prioritize activities and accommodations that offer the most satisfaction (utility) relative to their cost. They may make trade-offs, such as choosing a less expensive hotel to allocate more funds for activities they value more.
• Outcome: The family’s vacation spending aligns with their budget, reflecting a rational approach to maximizing enjoyment within their financial constraints.

In this example, consumers exhibit behaviours consistent with the economic model by actively seeking information, evaluating choices, and making decisions that aim to optimize their utility or satisfaction given their constraints. They consider costs and benefits when choosing products, planning expenditures, or making financial investments.

This model is a theory that sees man as a consumer who is a docile (compliant-obedient) recipient of marketing efforts and product promotions.

• Assumption: Consumers are passive and easily influenced by marketing and advertising.
• Key Characteristics: This model suggests that consumers don’t engage in extensive information processing and are heavily influenced by external cues, such as brand image and advertising.
• Example: In this model, consumers may make choices based on what is most prominently displayed in a store or what they’ve seen advertised recently.

Grocery Shopper:

• Situation: A consumer is at a grocery store to buy breakfast cereal.
• Passive Model Behaviour: The consumer approaches the cereal aisle without a specific brand or type in mind.
• Decision-Making Process: The consumer selects a cereal based on what is visually appealing or familiar to them without actively comparing ingredients, nutritional information, or prices.
• Outcome: The consumer chooses a cereal without extensive analysis or comparison shopping. They rely on visual cues or familiarity to make their selection and do not actively seek out the best value or nutritional option.

In this example, the consumer’s behaviour aligns with the passive model at the point of purchase. They make choices based on convenience, visual cues, or familiarity rather than engaging in an active decision-making process that involves comparing product attributes or prices.

Here the consumer is described as an active collector of information related to products of interest to them so that they are able to make satisfactory purchasing decisions.

• Assumption: Consumers are active information processors who engage in deliberate, systematic thinking when making decisions.
• Key Characteristics: This model emphasizes the role of cognitive processes like problem-solving, evaluation, and information search in consumer decision-making.
• Example: Cognitive models explore how consumers gather and process information, compare alternatives, and make choices based on cognitive assessments.

Smartphone Shopper:

• Situation: A consumer is in an electronics store looking to buy a new smartphone.
• Cognitive Model Behaviour: The consumer conducts thorough research before making a decision.
• Decision-Making Process: The consumer starts by identifying their specific needs, such as camera quality, processing power, and budget constraints. They gather information from online reviews, consult with friends or family, and visit multiple stores to compare options.
• Outcome: After extensive research and consideration, the consumer selects a smartphone that best aligns with their needs and preferences. They make an informed decision based on their research.

In this example, the consumer’s behaviour aligns with the cognitive model of consumer decision-making. They engage in a systematic and analytical process, considering various factors and conducting research to make an informed choice about the product that best meets their needs.

This model sees the consumer making purchasing decisions based on subjective criteria, such as love, fear, pride, affection, etc., rather than based on objective criteria resulting from objective judgment.

• Assumption: Emotions play a central role in consumer decision-making.
• Key Characteristics: This model suggests that consumers’ emotions and affective states heavily influence their choices. Emotions can override rational decision-making in some cases.
• Example: Emotional models examine how feelings like joy, fear, or desire can impact consumer choices, particularly in branding and advertising strategies.

Luxury Car Buyer:

• Situation: A consumer is considering buying a luxury car.
• Emotional Model Behaviour: The consumer’s decision is primarily influenced by emotional factors.
• Decision-Making Process: The consumer is drawn to the prestige, status, and emotional appeal associated with luxury cars. They visit dealerships, test drive several models, and are captivated by the sleek design, advanced technology, and the feeling of opulence.
• Outcome: The emotional connection and desire for luxury lead the consumer to choose a high-end luxury car, even if it means stretching their budget. The sense of satisfaction and status associated with the purchase is a significant driver of their decision.

In this example, the consumer’s behaviour aligns with the emotional model of consumer decision-making. Their choice is driven by emotions, including the desire for luxury, prestige, and the emotional satisfaction derived from owning a high-end product. These emotional factors play a central role in their decision-making process.

This model examines consumers who are guided by the principles of behavioural economics and might make purchasing decisions influenced by various psychological biases and heuristics. 

• Assumption: Consumers often deviate from rational behaviour due to cognitive biases and heuristics.
• Key Characteristics: This model combines elements of psychology and economics to study how individuals make decisions. It explores the systematic ways in which people depart from traditional economic models.
• Example: Behavioural economics considers phenomena like loss aversion, anchoring, and status quo bias, which can lead to decisions that appear irrational from a purely economic perspective.

An example: Let’s consider the concept of “anchoring bias.” This bias occurs when a consumer relies heavily on the first piece of information encountered when making decisions, even if it’s arbitrary or irrelevant. In this case:

Smartphone Shopper :

• Scenario: Imagine a consumer is shopping for a new smartphone. They walk into an electronics store and immediately notice a prominently displayed smartphone with a “sale” sign showing its original price as $1,000 and the sale price as $699. This is the first smartphone they encounter in the store.
• Consumer’s Thought Process: The consumer may anchor their perception of the smartphone’s value to that initial price of $1,000. This high anchor sets a reference point in their mind. As a result, the sale price of $699 seems like a significant discount, even if they hadn’t planned to spend that much on a phone.
• Purchase Decision: Influenced by the anchoring bias, the consumer is more likely to purchase this particular smartphone because they perceive it as a great deal compared to the high anchor price. They may not explore other smartphone options thoroughly because they’re anchored to the $1,000 reference point.

In this example, the behavioural economics model consumer’s decision is influenced by the anchoring bias, a psychological heuristic. They might make a purchase that they otherwise wouldn’t have made if the initial anchor price had been different.

Behavioural economics explores how individuals deviate from purely rational decision-making, considering psychological and emotional factors that influence choices.

In general, the disadvantages of consumer behaviour models are summarized as follows:

• Include Only Common Elements
• Variability in Element Importance
• Varied Importance for Different Uses
• Applicability Across Consumers
• Varying Decision Complexity

From my own experience as a consumer; I purchase specific products like clothing instantly based only on emotional factors, but I also decide on other products based on a step-by-step evaluation process, i.e. for more expensive products like taking a vacation, buying a computer, etc. For other products like food, I base my decision on past experiences and my overall education about healthy nutrition that is constantly evolves.

There is a need for a simplified consumer decision-making model that encompasses input, process, and output factors.

Input factors include marketing efforts and socio-cultural influences.

The decision-making process involves psychological elements affecting needs recognition, information search, and product evaluation.

Output factors comprise the purchase and post-purchase evaluation, influencing future decisions.

Such a model is valuable for understanding consumer behaviour, aiding marketing decisions, quantifying influencing variables, enabling segmentation, and guiding marketing strategies.

In essence, a consumer behaviour model proves beneficial when it::

• Fosters a comprehensive and interconnected perspective of consumer behaviour, facilitating segmentation and linking consumer thoughts to decisions. 2. Aids in identifying the requisite information for informed marketing decisions. 3. Encourages the quantification of the various factors and variables influencing consumer decisions. 4. Provides a foundation for effective market segmentation. 5. Serves as a basis for the development of well-informed marketing strategies.

The consumer decides on the purchase of a product by responding to various stimuli they receive. These stimuli are processed by the consumer’s mind, which is characterized as a “black box” precisely because the processes that take place inside it are not clear (figure A).

The consumer behaviour researcher can only roughly determine the process that a particular consumer followed in arriving at the decision (response) to purchase the product. The response is obvious, but not exactly what preceded it.

Figure B below shows a more specific form of the first figure describing what factors mediate before, during, and after making a decision to purchase products.

It is important to understand the importance of the post-purchase behaviour of the consumer since the role of marketing should not stop with the purchase of the product . Marketing efforts should be aimed at high repeat purchases.

Consumers evaluate the product after each purchase and use, and the results of these evaluations continuously feed into the consumer experience around the product. This experience is part of the whole decision-making process.

To induce consumer needs, specific conditions must be met. Consumers enter the decision-making process with a psychological set and various internal and external inputs. This set contains subjective criteria that shape their brand attitudes.

Before taking action (like making a purchase), consumers gather information and evaluate brands. Their psychological set evolves with new experiences and knowledge.

However, the trigger for recognizing a need is exposure to stimuli from the environment, such as advertising.

The connection between exposure and need recognition happens during tense situations, pushing consumers to seek information. Need recognition initiates the decision-making process, influenced by marketing or internal stimuli, like disappointment or physiological needs.

To make a decision and evaluate brands, consumers gather and process information, considering their criteria for need satisfaction with the right brand. Recognizing the need requires exposure to stimuli that gain attention, are understood in line with existing beliefs, and are retained in memory, especially if relevant to the consumer’s needs.

A relevant message can change the criteria for need satisfaction, potentially altering attitudes toward other brands. These changes influence the consumer’s future needs, their prioritization, and the specific evaluation of each brand using decision rules.

This process ultimately leads to the consumer’s expected satisfaction with each alternative brand based on the need association.

• Searching and Processing Information for Decision-Making

The quantity and quality of information consumers use to decide on products significantly impact their choices. Although more information is often assumed better, research by Keller and Staelin in 1987 suggests that too much information can lead to suboptimal decisions. They argue that quality enhances decision-making while quantity hinders it, especially with an excess of high-quality information.

Consumer confidence in choices is influenced by the quality, quantity, and recentness of information, according to the same study. The information environment affects how consumers process information, impacting decision effectiveness.

The presentation of product information also matters. Levin and Gaeth in 1988 conducted an experiment using minced meat and found that how information was framed influenced consumer perceptions. Personal experience moderates this effect; when consumers have personal experience with a product, they are less influenced by information presentation.

They presented minced meat as

• a) “75% fat-free”, or
• b) “with 25% fat”.

Consumers were more positive about the “75% fat-free” minced meat.

The order in which information is received plays a role in decision-making. The averaging model of information integration suggests that the first information source holds more weight. Levin and Gaeth’s experiment supported this notion.

Time availability affects information gathering. Hauser, Urban, and Weinberg in 1993 found that time constraints limit the quality and quantity of information consumers gather.

Consumer age influences information seeking. Cole and Balasubramanian in 1993 showed that younger consumers are more likely to seek information and make accurate choices based on nutritional information, especially when they can write down gathered data.

Involvement, the interaction of individual and task, affects information search (Punj and Stewart, 1983). Beatty and Smith in 1987  found positive relationships between information-seeking and consumer market involvement, attitude toward shopping, and time availability. However, consumer knowledge about a specific product category was negatively related to information search.

The findings of this study contradict those of the Moorman study in 1990 , which argued that age is positively correlated with an individual’s ability to process and use nutritional information.

Gender differences exist in information processing. Meyers-Levy and Maheswaran in 1991 found that women focus on details in advertising messages, while men rely on the overall message. However, these differences can disappear under certain conditions.

Stigler’s theory (1961) posited that consumers seek satisfactory information for optimal product purchases, but Avery (1993) showed it applies better to information searches outside the store. Avery (1996) applied Stigler’s (1961) Economics of Information Theory  to consumer search for grocery items, considering cost-benefit factors. Pre-store and in-store information searches are separate but complementary stages in food shopping.

Overall, various factors, including information quantity, quality, presentation, personal experience, time availability, age, involvement, and gender, influence how consumers search for and process information when making decisions.

Extended decision-making is a consumer approach where they meticulously evaluate multiple product brands, actively gathering extensive information. This method is typically employed for products that are expensive, have a long life cycle, pose high investment risk, are technologically advanced, require significant consumer involvement and demand active information gathering. Examples include cars, apartments, and stocks.

From a marketing perspective, when the target market predominantly uses extended decision-making, it is crucial for marketers to understand how consumers gather and assess information. It’s important to educate consumers about the key criteria where their brand excels compared to competitors. Informative advertising and comparative advertising play significant roles in facilitating this information-gathering process for potential customers.

Limited decision-making is a consumer approach applied to products bought at intervals more regularly than those in extended decision-making but still not very frequently. It also comes into play when consumers encounter a new brand of a familiar product and want to assess how it differs from their existing choices. In such cases, consumers seek information about the new brand to make comparisons and decide whether to adopt it.

Consumers engage in limited information processing by seeking information through inquiries, noticing advertisements, and similar actions. For instance, a tennis player familiar with racket brands might become interested in a friend using a new brand, prompting them to learn more about it through limited decision-making.

From a marketing standpoint, it’s essential to recognize that consumers use limited decision-making to mitigate the risk of purchasing a product. In response, marketers should create awareness programs that help consumers understand the new brand’s features, benefits, and distinctions from competitors. This approach builds consumer confidence in the new product.

Mechanical or automatic decision-making, driven by habit, is the simplest consumer decision-making process. It involves quick decisions without much mental effort. This process is applied to products that are not considered very important, are relatively cheap, and are used frequently.

Examples include daily bread from the same bakery, routine vegetable purchases, or consistently using a neighbourhood gas station for refuelling. Marketing’s role here is to maintain consistent product quality and associated services to satisfy existing consumers systematically. Additionally, marketing aims to attract new buyers by encouraging them to break the habit of purchasing competing brands through the introduction of new features, special prices, promotions, and so on.

Inhabitual decision-making and information-seeking are limited, and alternative evaluation is minimal. This habit-based decision-making offers two key advantages: a) reducing the risk of product failure and financial loss, and b) simplifying the decision-making process by saving time and energy compared to more complex decision-making approaches.

As habit becomes the foundation for decision-making, consumers reduce their information-seeking efforts. They primarily focus on specific brand information and give more weight to product price and availability while placing less emphasis on product-related information.

Decision-making rules vary in consumer behaviour, with consumers using distinct strategies based on product characteristics and personal preferences. These rules dictate how consumers gather and process information to arrive at their final choices. Here are some key aspects of decision-making rules:

Limited Information Gathering: Consumers typically search only a subset of available product brands during the selection process. They may not be aware of all brands and focus on those they consider acceptable (evoked set) while ignoring others (inert set). Some brands may even be considered unacceptable and avoided.

Variability in Information Gathering: Depending on the consumer’s decision-making process, the search for information can range from limited to extensive. The amount of information collected varies among consumers and product categories, and the order in which information is sought depends on the consumer’s priorities and product characteristics.

Multiple Criteria Evaluation: Consumers evaluate brands based on multiple criteria, such as price, taste, calories, and other attributes. These criteria vary in importance for different consumers and can influence their final decisions.

Order of Information Gathering: Consumers may ask for information in a specific order, based on their priorities. For example, a consumer may start by gathering information on calorie content, then taste, and so on, based on their preferences.

Sequential Information Gathering: Some consumers gather all the necessary facts about each brand before making a decision. They systematically collect information on all attributes of each brand they are considering.

Variability in Decision Speed: Decision speed can vary among consumers. Some individuals may make quick decisions by evaluating only one or two product features, while others may take more time and gather information on multiple attributes.

Impact of Purchase Quantity: The quantity of the product purchased can also influence brand choice. For instance, consumers buying multiple units of a product in a single purchase occasion may be more inclined to choose different brands or flavours, particularly if they usually don’t vary their choices in separate shopping events.

Influence of Brand Arrangement: The way brands are displayed on store shelves can also affect consumer choices. Familiar brands are more likely to be chosen when buying larger quantities, possibly due to the combined effect of purchase quantity and brand arrangement.

In essence, consumers employ diverse decision-making rules and strategies when choosing among product brands, and these rules can be influenced by various factors, including product characteristics, personal preferences, and purchase quantity. Understanding these rules is crucial for marketers seeking to influence consumer choices effectively.

Next, I will present various rules that can be used by the consumer to gather information on various brands and finally choose one of them.

• Specific Decision-Making Rules

Consumer decision-making can be categorized into two basic models: the “Compensatory Model” and the “Non-Compensatory Model.” These models are used depending on the situation, and they involve different approaches to evaluating and selecting brands.

Compensatory Model : In this model, consumers evaluate each brand on all the important product attributes or criteria. They assign weights to each criterion based on their importance and then calculate a weighted evaluation score for each brand. The brand with the highest overall score is chosen. Positive evaluations on one criterion can compensate for negative evaluations on another.

Non-Compensatory Model : In contrast, the Non-Compensatory Model involves evaluating brands on one criterion at a time. A positive evaluation on one criterion does not compensate for a negative evaluation on another. This model is based on the idea that consumers may find it challenging to consider multiple attributes simultaneously.

The Non-Compensatory Model can be implemented using three decision rules:

• Conjunctive Rule: Consumers set a minimum threshold for each attribute. Brands that fall below this threshold for any criterion are eliminated from consideration.
• Disjunctive Rule: Consumers set a minimum threshold for each attribute. Any brand that meets or exceeds the threshold for any criterion is considered acceptable.
• Lexicographic Rule: Consumers rank product attributes based on importance and then compare brands based on the most important attribute. If a brand performs well on the most important attribute, it is chosen. If not, the evaluation continues with the second most important attribute, and so on. If two brands have equal evaluations on the most important attribute, the one with the better evaluation on the second most important attribute is chosen.

The choice between compensatory and non-compensatory models depends on various factors, including time constraints, available information, the cost of acquiring information, consumer involvement with the product, brand loyalty, product importance, prior experience with the product, purchase habits, and product usage frequency.

In summary, consumers employ different decision-making models and rules based on the specific context and their individual preferences and constraints. These models and rules help consumers simplify complex choices and make decisions that align with their priorities and needs.

Complete Example  of Applying Decision Rules

The following example is based on Hawkins, Best, and Coney (1992) .

The consumer rates the products on a scale from 1 to 5, where 5 is the highest value. Each product feature has a different significance.

NOTE :  I solve this problem in the book (see below) .

The consumer’s decision-making process has significant implications for marketing strategy, as it directly influences how brands and businesses approach advertising, product development, packaging, the overall process of consumer persuasion, and customer engagement.

In particular, if we know the order in which consumers of a group gather and process information about different brands toward end up buying one of them, it is easier to present our brand elements (attributes, content, etc.) on the packaging in the same order, thus facilitating the processing of information by consumers.

Our brand advertising can also take the form of comparative advertising. In comparative advertising, the way we present the elements of the competing brands to be compared prompts consumers – receivers of the message to process the information in a certain way (whether compensatory or not). Mainly in comparative advertising the “Compensatory Model” is used in the presentation of the comparative data.

However, in this case, it’s important to be cautious when directly comparing our product to others, as this can lead to legal or ethical issues.

Plus, we can utilise Informational advertising that focuses on providing in-depth information about the product’s features, benefits, and uses. This can be especially effective when consumers are in the information-gathering phase of their decision-making process. By presenting clear and relevant information, we can help consumers make well-informed choices.

• E-commerce Boom During COVID-19
• Sustainability and Eco-consciousness
• Influence of Online Reviews and Social Media
• Personalization and Data Privacy
• Mobile Shopping and App Usage
• Subscription Services
• Conscious Consumerism
• Voice Commerce and Smart Devices
• Contactless Payments
• Augmented Reality (AR) and Virtual Reality (VR)

These recent trends highlight the dynamic nature of consumer behaviour and the evolving landscape in which businesses operate. We should evaluate these trends before we develop strategies for our business.

Actionable Takeaways for Marketers and Business Owners

I share those takeaways in the book (see below) .

In the dynamic world of consumer behaviour, understanding the intricate processes that drive decisions is the key to success for businesses and marketers.

We’ve embarked on a journey through the various models, factors, and influences that shape how consumers choose what to buy, when, and why.

This article, although extensive, only scratches the surface of this fascinating realm.

• An Intro to Consumer Behaviour

The Art and Science of Consumer Involvement: A Deep Dive

Decoding Consumer Perceptions: A Strategic Guide

• Decoding Consumer Behaviour: A Practical Journey Through 7 IDEALS
• Identify and Reach Your Target Audience: Comprehensive Guide
• Business Organisation and Administration: Thesis
• The Demanding Role of a Business Owner: Leading Towards Success
• The Strategic Significance of Marketing
• The Importance of Market Research
• Everything Starts With Research
• The “7 IDEALS” Methodology

For those eager to explore further, I invite you to delve into my comprehensive eBook entitled “The Consumer Decision-Making Journey: Unveiling the Process” , which delves deeper into each aspect we’ve touched upon. Inside, you’ll find additional examples, case studies, infographics, interactive sections, exercises, and actionable insights that can transform your approach to consumer engagement.

In addition, I share a handy framework for decision-making and an experiment that you can apply to many of your purchasing decisions in a variety of situations and dilemmas in real life.

Let me remind you that the consumer behaviour journey doesn’t end here… in fact, we’ve just got started – there’s so much more – this is just the decision-making process. So, be on the lookout for my upcoming releases, you’ll love it.

The world of consumer decision-making is ever-evolving, and as it does, so should your approach to understanding it.

Thank you for joining me in this exploration, next download the eBook to dive deeper into the beautiful world of consumer behaviour, and I look forward to your feedback.

Why should you read this book right away? 40 reasons.

What’s EXTRA in the 232-page book:

• A deeper analysis of the introduction to consumer behaviour (see previous article) .
• Analysis of the factors that influence consumer behaviour.
• Analysis of the consumer decision-making process overview.
• Analysis of the consumer behaviour models’ significance.
• One (1) more example of the economic model: investing in a retirement account.
• One (1) more example of the passive model: television viewer.
• One (1) more example of the cognitive model: enrolling in a training program.
• I go deeper into the luxury car buyer example.
• One (1) more example of the emotional model: fancy jacket buyer.
• One (1) more example of the behavioural economics model: expensive online fitness membership.
• The “Choose Your Own Purchasing Path” example: In this scenario, you are the consumer, the protagonist. An interactive section where I guide you through the various options and help you reflect on your decisions. There’s also a practical section entitled “Applying what you’ve learned”.
• The experiment “Real-Life Buying Scenario”: We put theory into practice and actually apply the knowledge of consumer behaviour models in a real-life buying scenario. I help you with guiding questions. This approach can be replicated in a wide range of purchasing situations.
• The “SmartChoice” framework. I created a framework to guide consumers through their buying decisions. It’s a structured framework that you can use for complex purchasing decisions and can help you analyse your decision-making processes and the outcomes, and last but not least, become a more conscious, mindful, and strategic consumer yourself.
• A comparison between 3 consumer behaviour models: Emotional vs. Economic vs. Cognitive Model.
• I go deeper into the disadvantages of consumer behaviour models.
• I go deeper into the input-process-output factors.
• I go deeper into the need arousal concept.
• I share another infographic explaining the need arousal concept.
• I go deeper into information processing and brand evaluation.
• I share another infographic illustrating information processing and brand evaluation.
• I go deeper into searching and processing information for decision-making.
• I give you a handy recap (in bullet points) of searching and processing information for decision-making.
• I share another infographic regarding mechanical or automatic decision-making (by habit).
• Another comparison: automatic (by habit) vs. extended decision-making.
• An infographic illustrating the above comparison.
• I go deeper into decision-making rules.
• I share another infographic regarding decision-making rules: the subset of alternative brands.
• I share an example: breakfast cereal to analyze the possible rules that the consumer uses when gathering and processing information in the decision-making process.
• I share an experiment conducted by Simonson and Winer in 1992, where they used yoghurt sales scanner data and hypothesized that as the number of purchase units in the same given purchase occasion increases…
• I go deeper into specific decision-making rules and I share what Russo and Dasher showed regarding consumers having difficulty considering two product attributes at the same time.
• I also share the factors on which the outcome of the processes described depends (bullet points).
• I share an example of applying decision rules: four (4) consumers evaluate an apartment downtown using different decision-making approaches: the compensatory model, conjunctive rule, disjunctive rule, and lexicographic rule (non-compensatory model).
• I solve the complete example of applying decision rules by Hawkins, Best, and Coney (1992) where a consumer rates the products (personal computers) on a scale from 1 to 5, where 5 is the highest value and each product feature has a different significance.
• I help you solve the problem with a video walkthrough step-by-step as well.
• I assign an exercise of applying decision rules for you to practice and get familiar with the concept and the different decision-making approaches. It’s about buying a set of noise-cancelling headphones. I use tables filled only with critical information leaving you space to fill in the blanks on your own. I ask some questions to help you in solving it and there’s a ‘SURPRISE’ if you solve it and share your answers with me. There’s a slight difference with the previous example that I solved. I added online reviews as a medium to gather data regarding the criteria.
• I go deeper into the implications for marketing strategy and I give you a thorough description of these implications.
• I go deeper into the recent trends – I explain them thoroughly.
• I share key actionable takeaways – what you can do effectively today to improve all your business operations and marketing activities.
• There’s another EXTRA section – another SURPRISE.
• An epilogue.

Table of Contents

Introduction, phase 1: the study of consumer behaviour.

• Questions of the Study of Consumer Behaviour
• Factors that Contributed to the Development of the Study of Consumer Behaviour

PHASE 2: Consumer Behaviour is Interdisciplinary

• The 6 Sciences
• The 6 Sciences Analysed

PHASE 3: The Study of Consumer Behaviour is Absolutely Essential

• Consumer Behaviour and the Consumer
• Consumer Behaviour and Marketing Strategy
• Consumer Behaviour and Public Policy

PHASE 4: A Simple Model of Consumer Behaviour

Phase 5: consumer behaviour introduction resume.

• Importance for Business Owners
• The Demanding Role of a Business Owner
• Importance of Market Research
• Importance of a Target Market

Introduction Recap

Phase 6: the decision-making consumer, phase 7: statistics, phase 8: consumer decision-making process overview, phase 9: consumer behaviour models and their significance.

• The Economic Model
• The Economic Model – Example #1
• The Economic Model – Example #2
• The Passive Model
• The Passive Model – Example #1
• The Passive Model – Example #2
• The Cognitive Model
• The Cognitive Model – Example #1
• The Cognitive Model – Example #2
• The Emotional Model
• The Emotional Model – Example #1
• The Emotional Model – Example #2
• The Behavioural Economics Model
• The Behavioural Economics Model – Example #1
• The Behavioural Economics Model – Example #2
• Choose Your Own Purchasing Path – Example
• Real-Life Buying Scenario: An Experiment
• The SmartChoice Framework
• Emotional vs. Economic vs. Cognitive Model

PHASE 10: The Disadvantages of Consumer Behaviour Models

Phase 11: the input-process-output factors, phase 12: the general model of the consumer’s purchasing behaviour.

• More Specific Model of Consumer Purchasing Behaviour

PHASE 13: Need Arousal

Phase 14: information processing and brand evaluation.

• Automatic (by habit) vs. Extended Decision-Making
• PHASE 15: Decision-Making Rules
• An Example (Breakfast Cereal)
• Yoghurt Scanner Sales Data
• Example of Applying Decision Rules #1
• Complete Example of Applying Decision Rules #2
• Exercise of Applying Decision Rules #1

PHASE 16: Implications for Marketing Strategy

Phase 17: recent trends, phase 18: actionable takeaways, the consumer-decision-making journey ebook.

Uncover how your choices are influenced and make smarter decisions with this FREE 232-page eBook. Explore real-life examples, problem-solving strategies, and actionable insights to enhance your buying habits and boost your business success. Download now and take the first step towards becoming a conscious consumer and a savvy marketer".

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Tasos Perte Tzortzis

Business Organisation & Administration, Marketing Consultant, Creator of the "7 Ideals" Methodology

Although doing traditional business offline since 1992, I fell in love with online marketing in late 2014 and have helped hundreds of brands sell more of their products and services. Founder of WebMarketSupport, Muvimag, Summer Dream.

Reading, arts, science, chess, coffee, tea, swimming, Audi, and family comes first.

MARKETING | ADVERTISING | SALES

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20+ Reasons Why Keyword Research is Important | Examples

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Why a website is important but not enough

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The Power Of Video Marketing In A Competitive Business World

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5 Tips To Improve Your Local SEO And Explode Your Reach

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Everything You Need To Know About Crafting Perfect Emails

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Infographic – How To Advertise Your Business Online For Free

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• Entrepreneurship Meaning: Is Not Just Running Businesses
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• Should I become an entrepreneur?
• What drives me as an entrepreneur - a personal story
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• 12 Powerful Productivity Hacks For Business Owners

Critical Steps To Ensure Personal Development In Business

• Most people don't succeed, but you can be the exception
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When Someone Says, I Don’t Have Time, I’m Too Old!

• 10 Ways To Know If You Need A Real Estate Agent

Rewarding Employees For A Healthy Working Environment

24 Tips To Succeed In Your Own Business

Simple & Effective Customer Loyalty Strategies You Can Use Today!

How To Drastically Improve Your Customer Service

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Why Psychometric Evaluation Tests Are Essential For Your Hiring Process

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7 Ways AI is Making an Impact On Manufacturing

7 Devices You May Not Realize You Need at Your Desk

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Modern Ponzi/Pyramid Business World – There is a Solution!

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Decrypting ConsumerBehaviour

Enter the groundbreaking "Market Parallax" Model.

We explore consumer behaviour by employing a diverse array of techniques, including research methodologies, data collection and analysis, market segmentation, targeted approaches, product positioning, and trial testing. 

Through these marketing lenses, we unravel the intricate field of consumer behaviour and explore avenues for influencing it judiciously.

Download the 31-page INFOGRAPHIC-BOOK to understand how consumers act on a deeper level and get closer to influencing their decisions with your marketing initiatives.

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