Is the purchase decision process of 5 stages for consumers that they go through while making a purchase.

Need or problem recognition

information search

alternative evaluation

purchase

post-purchase behavior

Help consumers realize they have an unmet need/want. ie. cell phone w/camera for pic of baby, caller id, chocolate chip cookie at mall, smell through exhaust, kids misbehaving in car (DVD), mottos, sayings, slogans, etc.

Find that people need to save more for retirement (buy mutual funds).

After consumers realize they have an unmet need/want, they search for information. Consumers maximize utility for minimum effort. Marketers who make it easy to find = business.

Easiest, quickest, what is already in your memory from prior experience/commercials

Marketing Implications - memorable repetitive ads and make experience memorable so information is in memory and easy to retrieve.

ie. Wendy's "where's the beef", Energizer "Keeps on going and going and going"

Personal source - word of mouth from friends/relatives, opinion leaders because we trust them and relationships with them so they won't do us wrong.

Publicly available sources - product rating agencies.

Marketers - promotions such as ads, pop displays, web sites, trained salespeople.

First consumers determine criteria of importance for evaluation. Marketing implications: marketers try to make your criteria the important ones. ie. freshness dating on soda, Angus Beef for Hardees, Safety for Hyundai.

Then consumers find brands that meet the criteria in general - Name Brands stand out.

Then they evaluate the best 4 or 5 to narrow the choice down to a manageable number.

1. Determine attributes of importance

2. Rate each product by each attribute

3. Sum up the ratings (highest numbered product chosen)

Lowest scores on one attribute may be overcome by high scores on the others.

Implications: can have a product that is very good in one area and very bad in another.

ie. 10/10/10/1 highest total chosen, Big Lots

1. Determine attributes of importance

2. Rate each product on each attribute

3. Determine a minimum cutoff level for each attribute

4. Choose the product which meets all min cutoff levels.

 More than one that meets all levels, choose the highest overall score that meet all cutoffs.

Implications: need to have a minimum level for every attribute. ie. 5/6/6/5 has minimums if cutoff = 5.

ie. Yugo high on price, no minimum on quality

Better terms of sale

Good past experience

Good warranty to reduce purchasers risk (esp no past exp)

Convenience - internet buying/home delivery

Reduce price, offer rebates, credit (90 days same as cash).

satisfied tells friends (returns), dissatisfied tells everyone (never returns) and is worse for business.

Toll free numbers for information, good return and exchange policies, well trained staff w/authority to handle complaints and fix them.

Feeling/anxiety if the decision was the right one or not (cognitive dissonance) and will be higher if the decision is very important and the product chosen was barely better than the other options. Good, but. ie. Bachelor show

Can be reduced by reaffirming correctness of the decision. ie. Toyota vs Honda

Consumer affects the use of the 5 stage process.

High involvement all 5 stages used when a purchase is risky (financial-expensive, social-norms of wearing right jeans, physical-safety airplane ride).

Low involvement some stages skipped ie. buying chewing gum (don't need recognition).

Routine-if solved before skip steps. Bought a car, satisifed, buy another.

 Limited-if solved before but something changes, go through some of the process.

Extended-entire process used

Marketers want routine so continue to buy the same products w/o information search or 5 stage processes.

Pyramid lowest to highest that gives marketers ideas of what needs to target.

Physiological (food/drink) - most important if there is a recession may never make it up to the other parts.

Safety (On-star/smoke alarms)

Social (Twitter/Facebook)

Personal (better person)

Self Actualization (better person)

Learned predisposition to respond in a positive or negative manner to stimulus.

Behavioral learning (hungry, eat, satisfied, what ate satisfied hunger.

Cognitive learning (reasoning, taste great less filling, beer that taste great less filling, we learned which beer to try.

Brand Loyalty-result of positive learning experience over time.

Behavioral intent (BI) = Attitude (A) + social norm belief (SNB) what my social group believes x motiviation to comply (MC) with these beliefs.

BI = (b x e) + (SNB)(MC) or

BI = A + (SNB)(MC)

Where: Attitude equals belief (b) that a product has an attribute times the evaluation (e) of the goodness/badness of that attribute A = b x e

Breakfast cereal contains sugar (belief) and sugar is bad (evaluation) thus, negative attitude towards breakfast cereal.

BI-however, Joe knows that Sugar Pops are the "in" thing and she wants to be "in" so she buys them. We behave differently than our attitude for social norms.

1. Changing consumer perceptions about extent to which a brand has certain attributes (cereal not high in sugar, cars high gas mileage). 2. Add an attribute or minor alteration of the product to fit needs (add calcium to OJ), 3. Change evaluation (e) of an attribute increase perceived goodness of attributes (calcium in Tums=good), 4. Change social norm, 5. Change motivation to comply.

Attribute becomes more positive

Opinion leaders (be like Mike)

Word of Mouth (friends/relatives)

Reference Groups (your posse)

Family (big influence keeping up with the Joneses)

Social Class

Culture

Change attitude by changing core beliefs 1) change belief about extent to which brand has attribute 2) add an attribute or 3) change evaluation of an attribute

Change social norm

Change motivation to comply

Women with diamon rings and men paying 2 months salary for one.

Getting married in a white wedding dress

Casual Fridays

Gift cards instead of money