INDIVIDUAL DECISION MAKING. The Purchasing Process Why do we buy anything?. Purchases are made in response to a problem Consumers are therefore problem solvers Most research has viewed consumer as a rational decision maker trying to maximize utility of purchases.
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The Purchasing Process
Why do we buy anything?
Why is it important to know this?
CONSUMER EFFORT IN
You’ve had your car now for 7 years and it’s in need of constant repair. What decision process do you go through in purchasing a new one?
Your toaster is now toast. What process do you go through in purchasing a new one?
Your at the gas station paying for your gas when you have an uncontrollable urge to buy a chocolate bar. How do you decide which one to buy?
Brand Loyalty: consistently buy the same things
Store Loyalty: consistently shop at same store
CONSUMPTION & LEARNING
Stages in Consumer Decision Making
EVALUATION OF ALTERNATIVES
How do you recognize a need for a product?
In this case it was need recognition – something was lacking
opportunity recognition - something to be gained
Once You’ve recognized you have a problem what motivates you to resolve the problem?
Can marketers stimulate consumers’ recognition of needs?
What is primary demand?
The total demand for all brands in a product category.
FOR WHAT ARE WE SEARCHING?
WHERE WILL WE SEARCH?
WHAT DETERMINES THE EXTENT OF THE SEARCH?
Do consumers always search rationally?
People feel the pain of a loss more strongly than the pleasure of an equal gain.
EVALUATION OF ALTERNATIVES
How do consumers narrow down the alternatives and choose one?
How Many brands of Mini vans can you think of?
What is it?
HP OfficeJet G85 All-in-one scanner/copier/fax/printer
Products are categorized in levels
Porsche Mercedes Cadillac
Which is more prestigious?
The real education problem of companies introducing new products in generating primary demand is to get customers to properly categorize the product.
Strategic Implications of Product Categorization
What are some dimensions, or characteristics, that you might use to assess business schools?
On each of these dimensions, where would you position relative to one another
U of Toronto, U of Calgary, U of L, Mount Royal College
Mount Royal College has decided to reposition itself as a premier business school.
What do you suggest they do to achieve this?
When comparing products or services what criteria do you use?
Which margarine do you buy? And Why?
How can Marketers influence what attributes are important
Situational effects on Consumer Behaviour
1. Behavioural/social - purchases tailored to specific occasions
2. Situational self image - who am I right now, feelings, role, ethnicity
3. Purchasing situation
4. Usage situation - time of day, in conjunction with other products
Non-Store Shopping E- COMMERCE
What are some of the advantages of E-commerce?
What are some of the Disadvantages
Retailing as Theatre
Colorful point of purchase displays can increase sales
UNDER PROMISE AND OVER DELIVER