Management School
Key Concept
Overview
Consumer decision-making
KMGT 715
Contemporary Consumer
and Customer Behaviour
Week 5
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Key Concept
Contemporary Consumer and Customer Behaviour
Week 5: Consumer decision-making
Decision-making process
Consumers go through a series of steps for purchasing a product or a service. The
Engel-Kollat-Blackwell model describes the five basic steps of decision-making process
(Darley, Blankson and Luethge, 2010):
1.
2.
3.
4.
5.
Problem recognition
Search
Alternative evaluation purchase
Choice
Outcomes
For example, Sally feels exhausted from her heavy work schedule throughout the year
and needs some time off going on vacation (problem recognition). She spent almost a
week searching for hotels in Italy. She surfed the Internet, read several travel forums,
assessed the reviews in TripAdvisor and also asked her cousin who lives in Italy for
recommending a hotel (search). She ended up with a short list of three hotels. For each
of these hotels she evaluated—based on her search—the place, cleanliness, personnel,
activities and price (alternative evaluation purchase) and decided to book Hotel X
(choice). Sally spent five days in Hotel X and stayed really satisfied. She recommended
it to her colleagues and wrote a positive review in TripAdvisor (outcome).
The amount of effort consumers put in each of the above stages differs based on the
importance of the purchase decision. Sally, for example, spent an entire week searching
for a hotel in Italy since getting some rest was very important for her. Another consumer
may spend only a few hours searching for a hotel for a one-night business trip as the
actual decision is not quite important.
Indeed, some decisions may be taken automatically as being routinised. In this case,
the second and third stages have minimal implications for marketers.
According to Darley et al. (2010), the third stage (i.e. alternative evaluation purchase) is
influenced by cognitive, affective and conative factors. Moreover, the entire decision-
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making process is affected by external influences. These influences include differences
in consumer characteristics (e.g. motives and lifestyle), sociocultural factors (e.g. culture
and reference groups), situational and economic factors and environmental traits.
East, Uncles and Lomax (2014) explored social influences in decision-making. Social
influences could occur through observation, introduction and receiving/seeking for
advice. Consumers may receive advice from interpersonal communication (i.e. face-toface, via telephone, emails, social media, etc.). The role of social influences is affected
by various factors, such as the product category, consumers’ socioeconomic status,
family, etc. Thus, as East et al. (2014) state, ‘changes in social conditions may result in
changes in consumption’ (p.787).
The impact of age on decision-making
Consumers’ decision-making is significantly influenced by demographic characteristics.
Among others, East et al. (2014) investigated the impact of age on decision-making
process. They found out that older consumers are more likely to have repeated
purchases as they live in smaller households (Uncles and Ehrenberg, 1990 cited in East
et al., 2014). However, it should be noted, that this assumption does not always reflect
significant differences in consumer decision-making process. For example, Burnett
(2002 cited in East et al., 2014) revealed that older consumers do not present higher
levels of loyalty to toiletries and mobile phones. On the other hand, Lambert-Pandraud
and Laurent (2010 cited in East et al., 2014) found that older women stay attached to
certain brands for longer.
Older consumers put a greater cognitive effort in decision-making, mainly because of
their conservatism. Cognitive effort is enhanced by purchase deferral (LambertPandraud et al., 2005 cited in East et al., 2014). East et al. (2014) concluded that
individuals who receive less advice (e.g. older consumers) could be less informed about
the choice alternatives and have fewer possibilities to buy new products. Positive WOM
was found to be associated to customer loyalty.
Cuddeford-Jones (2014) agrees that women over 50 follow a different decision process
when selecting clothes than younger female consumers, and thus ‘require a distinct
marketing tack’. Although most marketing campaigns target younger shoppers, the
fashion targeted for the older generation reveals great opportunities. One of the main
reasons is that the older age segment has more economic power, although one cannot
ignore the impact of the economic crisis to all fashion consumer segments.
Older female consumers spent £7bn on clothes (the younger age group spent £9.6bn)
(Cuddeford-Jones, 2014). Although the amount spent by younger consumers tends to
decrease, older consumers seem to spend more money over the years. One of the
most important traits of the 50+ market is that they spend more on dresses and also
focus on value. Approximately half of this age group purchase discount items. This may
stem from the belief that older consumers are generally more careful when buying
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items. Nevertheless, older women would probably pay more for outer clothing (e.g. a
coat) and accessories (e.g. a handbag) as they believe that it is worth investing in items
that they would wear or use for a longer time (Cuddeford-Jones, 2014).
Furthermore, more women over 50 buy clothes online (35% in 2013). It’s also notable
that half of the 35% of online older female buyers are over 60. Some retailers argue that
there is no need for designing marketing strategies only targeting older women as all
women have the need to feel younger. As Dr. Glover states (Cuddeford-Jones, 2014),
retailers should include the older age group to their brand approach and give emphasis
on the mindset instead of the age. ‘Consumers should look to brands that do not define
themselves by age, but that clearly are for that age’ (Cuddeford-Jones, 2014).
Online consumer decision-making
Darley et al.’s (2010) study focusses on the decision-making process of online
consumers. The authors stress that online consumers’ decision-making may be a
complicated process. The authors performed a content analysis on 52 academic articles
on online consumer behaviour. They found out that the decision-making is influenced by
how consumers use the Internet and believe that certain factors, such as the product
type, the level of involvement, personality and knowledge acquisition may be important
moderators in the decision-making process.
Darley et al. (2010) argue that online purchases may have increased due to the
economic crisis and the great number of job losses. On this point it would be also
interesting to investigate the role of online auctions and the corresponding consumer
behaviour, but according to Darley et al. (2010) there are a limited number of studies
focussing on this topic.
Ethical decision-making
After using several products, consumers decide what to do with them, having some
alternatives such as disposing, returning them to the supplier, re-selling or recycling
them (Culiberg and Bajde, 2013). In the past literature, recycling has been approached
as (a) an ethical issue faced by the consumer or (b) a topic that includes many ethical
dimensions. The most comprehensive model for describing ethical decision-making is
Jones (1991) cited in Culiberg and Bajde (2013). This model is issue-contingent and
explains the ethical decision-making process of individuals.
The Jones model includes the following four stages of ethical decision-making (Rest,
1983 cited in Culiberg and Bajde, 2013):
Stage 1: Recognising a moral issue
Stage 2: Making moral judgements
Stage 3: Establishing moral intent
Stage 4: Engaging in moral behaviour
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However, as Culiberg and Bajde (2013) state, this model has not been widely
empirically tested and only a limited number of studies which concentrate on ethically
questionable consumer behaviour have used it.
References
Cuddeford-Jones, M. (2014) ‘How women aged over 50 shop for fashion’, Marketing
Week, p.15.
Culiberg, B. & Bajde, D. (2013) ‘Consumer recycling: an ethical decision-making
process’, Journal of Consumer Behaviour, 12 (6), pp.449-459.
Darley, W.K., Blankson, C. & Luethge, D.J. (2010) ‘Toward an integrated framework for
online consumer behavior and decision making process: a review’, Psychology &
Marketing, 27 (2), pp.94-116.
East, R., Uncles, M.D. & Lomax, W. (2014) ‘Hear nothing, do nothing: the role of word
of mouth in the decision-making of older consumers’, Journal of Marketing
Management, 30 (7/8), pp.786-801.
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