Buyer decision process - wikipedia Buyer decision process This article includes a list of references, but its sources remain unclear because it has insufficient inline citations. Please help to improve this article by introducing more precise citations. ( June 2010 ) Marketing Marketing Marketing Management Key concepts Distribution Pricing Retail Service Activation Brand licensing Brand management Co-creation Corporate identity Dominance Effectiveness Ethics Operations Promotion Research Segmentation Strategy Account - based marketing Digital marketing Product marketing Social marketing Promotional content Advertising Branding Corporate anniversary Direct marketing Loyalty marketing Mobile marketing On - hold messaging Personal selling Premiums Prizes Product placement Propaganda Publicity Sales promotion Sex in advertising Underwriting spot Promotional media Behavioral targeting Brand ambassador Broadcasting Display advertising Drip marketing In - game advertising Mobile advertising Native advertising New media Online advertising Out - of - home advertising Point of sale Printing Product demonstration Promotional merchandise Publication Visual merchandising Web banner Word - of - mouth The buying decision process is the decision - making process used by consumers regarding market transactions before, during, and after the purchase of a good or service. It can be seen as a particular form of a cost -- benefit analysis in the presence of multiple alternatives. Common examples include shopping and deciding what to eat. Decision - making is a psychological construct. This means that although a decision can not be `` seen '', we can infer from observable behaviour that a decision has been made. Therefore, we conclude that a psychological `` decision - making '' event has occurred. It is a construction that imputes commitment to action. That is, based on observable actions, we assume that people have made a commitment to effect the action. Nobel laureate Herbert A. Simon sees economic decision - making as a vain attempt to be rational. He claims ( in 1947 and 1957 ) that if a complete analysis is to be done, a decision will be immensely complex. He also says that peoples ' information processing ability is limited. The assumption of a perfectly rational economic actor is unrealistic. Consumers are influenced by emotional and nonrational considerations making attempts to be rational only partially successful. Contents 1 Stages 1.1 Problem / need - recognition 1.2 Information search 1.3 Evaluation of alternatives 1.4 Purchase decision 1.5 Post-purchase behavior 2 Models of buyer decision - making 3 Cognitive and personal biases in decision - making 4 Neuroscience 5 See also 6 References 7 Bibliography Stages The stages of the buyer decision process were first introduced by John Dewey in 1910. Later studies expanded upon Dewey 's initial finding. Engel, Blackwell and Kollat in ( 1968 ). Consumers shopping at London 's Burlington Arcade engage in a variety of recreational and functional purchasing activities - from window shopping through to transporting their purchases homewards Problem / Need Recognition - Recognize what the problem or need is and identify the product or type of product which is required. Page text. Information Search - The consumer researches the product which would satisfy the recognized need. Evaluation of Alternatives - The consumer evaluates the searched alternatives. Generally, the information search reveals multiple products for the consumer to evaluate and understand which product would be appropriate. Purchase Decision - After the consumer has evaluated all the options and would be having the intention to buy any product, there could be now only two things which might just change the decision of the consumer of buying the product that is what the other peers of the consumer think of the product and any unforeseen circumstances. Unforeseen circumstances for example in this case could be financial losses which led to not buying of the product. Post Purchase Behavior - After the purchase the consumer may experience post purchase dissonance feeling that buying another product would have been better. addressing post purchase dissonance spreads good word for the product and increases the chance of frequent repurchase. These five stages are a framework to evaluate customers ' buying decision process. While many consumers pass through these stages in a fixed, linear sequence, some stages such as evaluation of alternatives may occur throughout the purchase decision. The time and effort devoted to each stage depends on a number of factors including the perceived risk and the consumer 's motivations. In the case of an impulse purchase, such as the purchase of a chocolate bar as a personal treat, the consumer may spend minimal time engaged in information search and evaluation and proceed directly to the actual purchase. The rise of digital media and social networks is changing the way that consumers search for product information Problem / need - recognition Problem / Need - recognition is the first and most important step in the buying decision. Without the recognition of the need, a purchase can not take place. The need can be triggered by internal stimuli ( e.g. hunger, thirst ) or external stimuli ( e.g. advertising ). Maslow held that needs are arranged in a hierarchy. According to Maslow 's hierarchy, only when a person has fulfilled the needs at a certain stage, can he or she move to the next stage. The problem must be the products or services available. It 's how the problem must be recognized. Information search The information search stage is the next step that the customers may take after they have recognized the problem or need in order to find out what they feel is the best solution. This is the buyer 's effort at searching the internal and external business environments to identify and observe sources of information related to the focal buying decision. The field of information has come a long way in the last forty years, and has enabled easier and faster information discovery. Consumers can rely on print, visual, and / or voice media for getting information. Evaluation of alternatives Shoppers inspect the quality of fresh produce at a market in Jerusalem. At this stage, consumers evaluate different products / brands on the basis of varying product attributes, and whether these can deliver the benefits that the customers are seeking. This stage is heavily influenced by one 's attitude, as `` attitude puts one in a frame of mind : liking or disliking an object, moving towards or away from it ''. Another factor that influences the evaluation process is the degree of involvement. For example, if the customer involvement is high, then he / she will evaluate a number of brands ; whereas if it is low, only one brand will be evaluated. Customer involvement High Medium Low Characteristics High Medium Low Number of brands examined Many Several One Number of sellers considered Many Several Few Number of product attributes evaluated Many Moderate One Number of external information sources used Many Few None Time spent searching Considerable Little Minimal Purchase decision This is the fourth stage, where the purchase takes place. According to Kotler, Keller, Koshy and Jha ( 2009 ), the final purchase decision can be disrupted by two factors : negative feedback from other customers and the level of motivation to comply or accept the feedback. For example, after going through the above three stages, a customer chooses to buy a Nikon D80 DSLR camera. However, because his good friend, who is also a photographer, gives him negative feedback, he will then be bound to change his preference. Secondly, the decision may be disrupted due to unanticipated situations such as a sudden job loss or the closing of a retail store. Post-purchase Behavior These stages are critical to retain customers. In short, customers compare products with their expectations and are either satisfied or dissatisfied. This can then greatly affect the decision process for a similar purchase from the same company in the future, mainly at the information search stage and evaluation of alternatives stage. If customers are satisfied, this results in brand loyalty, and the information search and evaluation of alternative stages are often fast - tracked or skipped completely. As a result, brand loyalty is the ultimate aim of many companies. On the basis of either being satisfied or dissatisfied, a customer will spread either positive or negative feedback about the product. At this stage, companies should carefully create positive post-purchase communication to engage the customers. Also, cognitive dissonance ( consumer confusion in marketing terms ) is common at this stage ; customers often go through the feelings of post-purchase psychological tension or anxiety. Questions include : `` Have I made the right decision ? '', `` Is it a good choice ? '', etc. Models of buyer decision - making Making a few last minute decisions before purchasing a gold necklace from a Navy Exchange vendor There are generally three ways of analysing consumer buying decisions : Economic models - largely quantitative and are based on the assumptions of rationality and near perfect knowledge. The consumer is seen to maximize their utility. See consumer theory. Game theory can also be used in some circumstances. Psychological models - psychological and cognitive processes such as motivation and need recognition. They are qualitative rather than quantitative and build on sociological factors like cultural influences and family influences. Consumer behaviour models - practical models used by marketers. They typically blend both economic and psychological models. In an early study of the buyer decision process literature, Frank Nicosia ( Nicosia, F. 1966 ; pp 9 -- 21 ) identified three types of buyer decision - making models. They are the univariate model ( He called it the `` simple scheme ''. ) in which only one behavioural determinant was allowed in a stimulus - response type of relationship ; the multi-variate model ( He called it a `` reduced form scheme ''. ) in which numerous independent variables were assumed to determine buyer behaviour ; and finally the `` system of equations '' model ( He called it a `` structural scheme '' or `` process scheme ''. ) in which numerous functional relations ( either univariate or multi-variate ) interact in a complex system of equations. He concluded that only this third type of model is capable of expressing the complexity of buyer decision processes. In chapter 7, Nicosia builds a comprehensive model involving five modules. The encoding module includes determinants like `` attributes of the brand '', `` environmental factors '', `` consumer 's attributes '', `` attributes of the organization '', and `` attributes of the message ''. Other modules in the system include, consumer decoding, search and evaluation, decision, and consumption. Some neuromarketing research papers examined how approach motivation as indexed by electroencephalographic ( EEG ) asymmetry over the prefrontal cortex predicts purchase decision when brand and price are varied. In a within - subjects design, the participants were presented purchase decision trials with 14 different grocery products ( seven private label and seven national brand products ) whose prices were increased and decreased while their EEG activity was recorded. The results showed that relatively greater left frontal activation ( i.e., higher approach motivation ) during the predecision period predicted an affirmative purchase decision. The relationship of frontal EEG asymmetry with purchase decision was stronger for national brand products compared with private label products and when the price of a product was below a normal price ( i.e., implicit reference price ) compared with when it was above a normal price. Higher perceived need for a product and higher perceived product quality were associated with greater relative left frontal activation. For any high - involvement product category, the decision - making time is normally long and buyers generally evaluate the information available very cautiously. They also utilize an active information search process. The risk associated with such decision is very high. Cognitive and personal biases in decision - making Main article : List of cognitive biases It is generally agreed that biases can creep into our decision - making processes, calling into question the correctness of a decision. Below is a list of some of the more common cognitive biases. Selective search for evidence - We tend to be willing to gather facts that support certain conclusions but disregard other facts that support different conclusions. Selective perception - We actively screen out information that we do not think is salient. Premature termination of search for evidence - We tend to accept the first alternative that looks like it might work. Conservatism and inertia - Unwillingness to change thought patterns that we have used in the past in the face of new circumstances. Experiential limitations - Unwillingness or inability to look beyond the scope of our past experiences ; rejection of the unfamiliar. Wishful thinking or optimism - We tend to want to see things in a positive light and this can distort our perception and thinking. Recency - We tend to place more attention on more recent information and either ignore or forget more distant information. Repetition bias - A willingness to believe what we have been told most often and by the greatest number of different of sources. Anchoring - Decisions are unduly influenced by initial information that shapes our view of subsequent information. Group think - Peer pressure to conform to the opinions held by the group. Source credibility bias - We reject something if we have a bias against the person, organization, or group to which the person belongs : We are inclined to accept a statement by someone we like. Incremental decision - making and escalating commitment - We look at a decision as a small step in a process and this tends to perpetuate a series of similar decisions. This can be contrasted with zero - based decision - making. Inconsistency - The unwillingness to apply the same decision criteria in similar situations... Attribution asymmetry - We tend to attribute our success to our abilities and talents, but we attribute our failures to bad luck and external factors. We attribute other 's success to good luck, and their failures to their mistakes. Role fulfillment - We conform to the decision - making expectations that others have of someone in our position. Underestimating uncertainty and the illusion of control - We tend to underestimate future uncertainty because we tend to believe we have more control over events than we really do. Faulty generalizations - In order to simplify an extremely complex world, we tend to group things and people. These simplifying generalizations can bias decision - making processes. Ascription of causality - We tend to ascribe causation even when the evidence only suggests correlation. Just because birds fly to the equatorial regions when the trees lose their leaves, does not mean that the birds migrate because the trees lose their leaves. Neuroscience Neuroscience is a useful tool and a source of theory development and testing in buyer decision - making research. Neuroimaging devices are used in Neuromarketing to investigate consumer behaviour. See also Advertising management Brand Brand awareness Cognition Consumer behaviour Consumer choice Cost -- benefit analysis Group process Marketing management Product management Product life - cycle management ( marketing ) References Jump up ^ Engel, James F., Kollat, David T. and Blackwell, Rodger D. ( 1968 ) Consumer Behavior, 1st ed. New York : Holt, Rinehart and Winston 1968 Jump up ^ Nicosia, Francesco M. ( 1966 ) Consumer Decision Process. Englewood Cliffs, N.J. : Prentice Hall, 1966 Jump up ^ Dewey, John ( 2007 ). How we think. New York : Cosimo. ISBN 9781605200996. ^ Jump up to : Kotler, Philip. `` dl.ueb.edu.vn/bitstream/1247/2250/1/Marketing_Management_-_Millenium_Edition.pdf '' ( PDF ). Pearson Customer Publishing. Archived from the original ( PDF ) on 1 February 2013. Retrieved 28 December 2012. Jump up ^ Rossiter, J and Bellman, S., Marketing Communications : Theory and Applications, Pearson Australia, 2005, p. 24 ^ Jump up to : Kotler, P., Keller, K.L., Koshy, A. and Jha, M. ( 2009 ) Marketing Management -- A South Asian Perspective, but China and Japan also contribute 13th ed. India : Prentice Hall, 2009 Jump up ^ Bunn, Michele D. ( January 1993 ). `` Taxonomy of Buying Decision Approaches ''. Journal of Marketing. American Marketing Association. 57 ( 1 ) : 38 -- 56. doi : 10.2307 / 1252056. JSTOR 1252056. Jump up ^ Blythe, Karn ( 2008 ) Consumer Behavior. U.K., Thompson Learning, 2008 Jump up ^ Foxall, Gordon. R., ( 2005 ) Understanding Consumer Choice USA, Palgrave Macmillan, 2005 Jump up ^ Niklas Ravaja, Outi Somervuori and Mikko Salminen ( 2012 ) Predicting purchase decision The role of hemispheric asymmetry over the frontal cortex, Journal of Neuroscience, Psychology, and Economics Jump up ^ Impact of Brand Image on Consumer Decision - making : A Study on High - technology Products, MPM Raj, S Roy - Global Business Review, 2015 Jump up ^ Yoon, C. ; Gonzalez, R. ; Bechara, A. ; Berns, G.S. ; Dagher, A.A. ; Dube, L. ; Huettel, S.A. ; Kable, J.W. ; Liberzon, I. ; Plassmann, H. ; Smidts, A. ; Spence, C. ( 2012 ). `` Decision neuroscience and consumer decision making ''. Marketing letters. Springer Science + Business Media, LLC 2012. 23 : 473 -- 485. doi : 10.1007 / s11002 - 012 - 9188 - z. Bibliography Carlyn, Marcia. `` An Assessment of the Myers - Briggs Type Indicator. '' Journal of Personality Assessment. 41.5 ( 1977 ) : 461 - 73. Cheng, Many M., Peter F. Luckett, and Axel K. Schulz. `` The Effects of Cognitive Style Diversity on Decision - Making Dyads : An Empirical Analysis in the Context of a Complex Task. '' Behavioral Research in Accounting. 15 ( 2003 ) : 39 - 62. Gardner, William L., and Mark J. Martinko. `` Using the Myers - Briggs Type Indicator to Study Managers : A Literature Review and Research Agenda. '' Journal of Management. 22.1 ( 1996 ) : 45 - 83. Henderson, John C., and Paul C. Nutt. `` Influence of Decision Style on Decision Making Behavior. '' Management Science. 26.4 ( 1980 ) : 371 - 386. Kennedy, Bryan R., and Ashely D. Kennedy. `` Using the Myers - Briggs Type Indicator in Career Counseling. '' Journal of Employment Counseling. 41.1 ( 2004 ) : 38 - 44. Bettman, James R. ( 1979 ). `` An Information Processing Theory of Consumer Choice. '' Addison - Wesley Educational Publishers. Yang, Haiyang and Ziv Carmon ( 2010 ), `` Consumer Decision Making, '' in Jagdeth Sheth & Naresh Malhotra ( eds. ), Wiley International Encyclopedia of Marketing, New York : Wiley. Myers, I. ( 1962 ) Introduction to Type : A description of the theory and applications of the Myers - Briggs type indicator, Consulting Psychologists Press, Palo Alto Ca., 1962. Nicosia, F. ( 1966 ) Consumer Decision Processes, Prentice Hall, Englewood Cliffs, 1966. Pittenger, David J. `` The Utility of the Myers - Briggs Type Indicator. '' Review of Educational Research. 63 : 4 ( 1993 ) : 467 - 488. Simon, H. ( 1947 ) Administrative behaviour, Macmillan, New York, 1947, ( also 2nd edition 1957 ). Volkema, Roger J., and Ronald H. Gorman. `` The Influence of Cognitive - Based Group Composition on Decision - Making Process and Outcome. '' Journal of Management Studies. 35.1 ( 1998 ) : 105 - 121. Retrieved from `` https://en.wikipedia.org/w/index.php?title=Buyer_decision_process&oldid=808843922 '' Categories : Decision theory Consumer theory Hidden categories : Articles lacking in - text citations from June 2010 All articles lacking in - text citations Use dmy dates from October 2013 Talk Contents About Wikipedia Deutsch Latviešu Magyar Português Slovenščina Edit links This page was last edited on 5 November 2017, at 15 : 15. About Wikipedia

Question: five stages in the consumer purchase decision process
Answer: Problem/Need Recognition