Consumer behaviour and decision making process

Consumers are referred as the end users of the product or service. Consumer behaviour is defined as the process in which the consumer takes decisions in buying a product, service to satisfy his/her needs and desires.( Solomon et al. 2006). There are a wide range of products available nowadays to satisfy the primary needs of the customers, so the decision making process and the priority for the individuals or groups have been increasing day by day.

Hanson (2005) stated that the decision making of the customer not only involves the material activities but also psychological and emotional activities. It is almost like a role play where the actors change their costumes and the backdrops to add effect to the play each time depending on the situation. Same way the consumers also change their decisions depending on the situation and their taste. So consumer behaviour is the study of what, when ans why they need the products or services.

Nowadays the market perspective has been changed from buyers market to the sellers market. The best way the sellers can come out with a strategy the best it can influence the buyers. So this study influences the companies why they have to concentrate more on consumer decision making process.

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Kotler and Armstrong (2002) suggest that consumers respond in particular ways to different stimuli after they have processed those stimuli in their minds. For example, consumers are sometimes persuaded more by logical arguments, or more by emotional or symbolic appeals. It is a field of study where in the seller’s market has disappeared and the buyer’s market has come up. Understanding these issues helps the companies to adapt their strategies by taking the consumer into consideration (Ofcomconsumerpanel 2008a). This study of consumer buying behaviour helps to understand the reasons for making purchases, factors influencing consumer behaviour and the changing factors in the society.

Consumer behaviour towards spending is changing as they begin to control what they want. Women are the primary shopper and account to 80% at the time of decision making (Mintel 2008). Many companies target at women and are looking at what women really want. The target woman is overworked, overstressed, time-crunched, multitasking, in a hurry and looking for a solution in every purchase action. Bartos (1989) puts forward that the behaviour of women is constantly changing and the retailers need to study their target audience frequently because it is common that the profile of their consumers change with the passage of the time. In support Berman and Evans (2001) propose that consumer behaviour involves interactions where certain aspects are necessarily to be studied such as what the consumer think, what the consumer want or what environmental events can influence in their behaviour. He also adds that it involves exchanges between human beings which are to be studied in detail by the retailers to gain competitive advantage.

The study of consumer behaviours becomes very important to help understand the above factors and the ever changing needs and requirements of consumers which influence their behaviour towards purchasing clothes in the UK.

2.3 Maslow’s Theory( check govindarajan 2007 p 96)

Maslow’s hierarchy of needs is predetermined in order of importance and is often depicted as a pyramid where human needs form a hierarchy; from basic physiological demands to the need for self-actualization. The higher needs in this hierarchy only come into focus when the lower needs in the pyramid are met. Lower levels needs of an individual must be reasonably satisfied before attending higher level needs.

Figure 2: Maslow’s Hierarchy of Needs

Source: Derived from Kotler et al. (2005)

2.3.1 Physiological needs

->these include food,air,water,sleep and any other necessities to sustain and preserve life. These are the most basic needs and people will be motivated to fulfill them first through whatever behaviour.

Physiological needs include the most basic needs that are required to survive. It motivates the individual to improve their feelings to establish ability of satisfaction. Of all the basic needs, clothing is one the most basic needs without which an individual cannot survive. Clothes take account of the activities of the human body and not interfere with body movements. Clothes must be simple to put on and off and adaptable to a variety of activities

2.3.2 Safety needs

->the satisfy needs consists of the need for clothing, protection and an environment with a predictable pattern such as job security, pension and insurance . people are motivated when the psychological needs are satisfied.

Clothing has become an obligatory part of the society and for individuals. Technological developments in the field of clothing products and merchandising attract individuals and persuade them to purchase. Clothing which emerged as a protective item in the early stages is now moving towards fashion and design.

2.3.3 Belongingness and love needs

->these include the need to be liked by others, to be a wanted member and to belong to a group other than just a family.

Humans have a desire to belong to groups: clubs, work groups, religious groups, family, gangs, etc. thus relating to the social needs that recognize them. Clothing products is made use of in all aspects of life and the usage is said to be influenced by groups. For instance, purchasing behaviour of clothing products are influenced by clothing retailers and the range of products that they sell (Cox and Brittain 2000). People spend time in purchasing for their clothes as individuals and also in groups.

2.3.4 Esteem needs

->these include the need for self-respect,sence of achievement and recognition from others.the desire for status ans prestige is an important aspect of the need for esteem.satisfaction of the self esteem is necessary in the world.

When the first three classes of needs are satisfied, the needs for esteem can become dominant. Esteem needs are of two types; result from competence of a task and recognition of a task. Some individuals are satisfied with their purchases and some are satisfied when it is being recognized by others. Factors like quality, fashion and store patronage helps to fulfill one’s esteem needs. For example, people purchasing in M&S are very much satisfied with the quality of clothing products that they buy but aren’t satisfied with the quality offered by Primark (Birtwistle and Tsim 2005). When needs are satisfied, people feel self-confident and valuable. When needs are frustrated, they feel inferior, weak, helpless and worthless.

2.3.5 Self-actualization needs

-> Maslow’s hierarchy of needs is often portrayed in the shape of a pyramid, with the largest and lowest levels of needs at the bottom, and the need for self-actualization at the top, also the needs for people.(  Bob F. Steere (1988)

->”What a man can be, he must be.”(maslow,1954 p91)

->Maslow describes this desire as the desire to become more and more what one is, to become everything that one is capable of becoming.(maslow 1954 p92)

-> For example one individual may have the strong desire to become an ideal parent, in another it may be expressed athletically, and in another it may be expressed in painting, pictures, or inventions.(maslow 1954 p93)

-> Maslow also states that even though these are examples of how the quest for knowledge is separate from basic needs he warns that these “two hierarchies are interrelated rather than sharply separated” (Maslow 97)

->concept of fulfilling one’s potential and becoming every thing one is capable of becoming.( govindarajan 2007)

When all of the foregoing needs are satisfied, the needs for self-actualization are activated. Maslow’s basic position is that when an individual becomes more self-actualized they tend to become wiser. Unlike lower level needs, this need is never fully satisfied. New opportunities continue to grow simultaneously to psychological growth. Warren and Mark (1997) suggest that Maslow’s ultimate conclusion that the highest levels of self-actualization are magnificent in their nature as one of his most important contributions to the study of consumer behaviour.

2.4 Consumer decision making process

->people calmly and carefully integrate as much information as possible with what they know about the product, painstakingly weigh the pluses and minuses of each alternative , and arrive at a satisfactory decision.(m.r. Solomon 2004 p 239) this process implies that steps in decision making should be carefully studies by marketing managers.

Buyer decision processes are the decision making processes undertaken by consumers in regard to a potential market transaction before, during, and after the purchase of a product or service (Chris 1993). Decision making is the cognitive process of selecting a course of action from among multiple alternatives. Common examples include shopping, deciding what to eat. Decision making is said to be a psychological construct. In the past, investigations on consumer decision-making issues were mainly focused on the decision-making process. However, (Roberts 1998) argues that consumers may sometimes typically rely on simple strategies, rather than going through a series of steps or processes rationally when they made purchase decisions. There are 5 stages involved in the consumer decision making process of which actual purchasing is only one stage of the process. All consumer decisions do not always include all 5 stages, as it is also determined by the degree of complexity.

Figure 3: Decision making process

Source: Adapted from Orren et al. (2005)

2.4.1 Problem recognition

regardless of type of buyer decision situation, some combination of internal and external stimuli will first trigger the buying decision process by highlighting an unsatisfied need.(r.l. sandhusen p231)

->the buyer senses the difference between his/her actual state and some desired state.the need can be triggered by internal stimuli ex: hunger,thirst,sex,etc becomes high level enough to become a drive. From previous experience, the person has learned how to cope up with this drive and ismotivated toward objects that he or she knows will satisfy him/her(govindarajan 2007 pg 98)

The decision making process starts with the recognition of the problem. The consumer decides on what product to buy and what not to. Angel et al. (1990) state that problem recognition as a process of differentiation between the desired state and the actual condition. A consumer perceives a product to be ideal but the actual state of the product may differ. They lack knowledge regarding the identification of purchase options, decision of products to satisfy their need and expectations towards product’s presentation and description which leads to returning of the goods purchased (Peter et al. 1999).

The question that is raised is how does a consumer decide on what product or service to buy? Women customers have different needs and retail employees can be at their most effective when they meet the requirements of individual customers. Change in desired state can occur due to reference groups and originality seeking behaviour of the consumers. Change in actual state of affairs can occur due to stock out situations, arousal of needs, and post purchase evaluation. This differentiation at the time of purchasing a product is termed as problem recognition (Cox and Brittain 2000).

2.4.2 Information search (from book p294)

->many consumers, especially veteran shoppers, enjoy browsing just for thr the fun of it, or they want to stay upto date on whats happening in the market place. They are engaging on ongoing search( p.h.block, d.l.sherrell and n.m.ridgway 1986 p 119-26)

->people will put themselves out to collect as much information as possible, as long as the process of gathering it is not too onerous or time-consuming(j.g.lynch jr and d.ariely 2000 p 83-103)

->if the felt need motivating behaviour is strong enough and the product is capable of quickly satisfying this need, the buyer will probably not reach this second stage of the decision process. How ever when reached these two levels of search activity are possible.

1)some search,,during which heightened interest makes the buyer more receptive to product information, and

2) active information search, during which the buyer actively searches for such information.(r.l. sandhusen p 231)

Information search is made by the consumer for the solution of problem recognised in the previous step. A successful search fetches possible alternatives to the consumer. Information search is of two types, internal and external. Internal search is what the mind thinks. The consumer recalls the known brands at the time of purchase. External search happens when the consumer needs more information which involves solution from various sources: friends, family, advertising, salespeople etc (Chris 1993). Consumer behaviour is rapidly changing as buyers are researching their purchases before spending their money. Women in particular seek information before purchase and then decide on where to buy and are based on the awareness of the product or service that is offered by a particular store.

2.4.3 Evaluation of alternatives

->the merketeer needs to know about the alternative evaluation, that is, how the consumer processes information to arrive at brand choices.(govindarajan 2007)

How consumers compare the products found during the information search? The next step in the consumer buying process is the evaluation and selection of alternatives based on the gathered information. Consumers do not consider all brands available in the market for evaluation. They establish criteria based on the price, appearance and service to shortlist a set of choices on which evaluation is done. This is known as the evoked set which is defined as the set of brands that a consumer bears in mind while making a purchase decision (Peter et al. 1999). Clothing choice criteria are defined as the intrinsic (inherent to the product) and extrinsic (product-related, but not part of the physical product) product attributes that associated with desired benefits or incurred costs as consumers make buying decision among clothing alternatives. Intrinsic product attributes are those that cannot be changed without altering the physical characteristics of the product, while extrinsic ones are those that are exerted by manufacturers or retailers and do not form the component parts of the product. Different criteria may have varied importance in every consumer’s mind. While consumers would assign high importance on the criteria that can really reflect their underlying characteristics and experiences (Forney et al. 1999).

2.4.4 Purchase decision

purchase decisions often begin with trial purchase of limited quantities. Repeat purchases are related to brand loyalty(govindarajan 2007)

How and where consumers make the purchase? After evaluation of alternatives consumer go for the next step of selection of outlets and purchasing of products. It is in this step where the consumer decides about issues like where to buy, when to buy and how much quantity to buy. The consumer also makes a final decision regarding the brand of purchase by seeking customer service which includes negotiation and payment for the product purchased.

The critical characteristics of women apparel can always determine its ultimate purchase acceptance or rejection by consumers. The criteria that consumers use in clothing purchase decisions have long been regarded as an important issue for investigation in many previous consumer behavioural studies. Eckman et al. (1990) have identified many product attributes and criteria that are critical for fashion consumers in clothing purchase, and basically all these can be summarized under intrinsic and extrinsic categories.

2.4.5 Purchase evaluation

-> an understanding of these post purchase responses is important to marketers in that they influence the likelihood that buyerswill repurchase products and/or encourage others to purchase the product.(r.l.sandhusen 2000 p 236)

->consumers compare the products performance against their expectations.(govindarajan 2007)

The final step in the consumer buying process is the post purchase decision. Williams (2002) implies that the post purchase decision arises from the concept of cognitive dissonance, an uncomfortable feeling or stress caused by holding two contradictory ideas simultaneously. The consumer feels that an alternate would be preferable for the purchased product which leads to switching of brands. This can be reduced by warranties, after sale communication etc.The outcome of the post-purchase evaluation stage is a level of customer satisfaction or dissatisfaction, which is determined by the customer’s overall feelings about the effectiveness of the treatment and the experience. The number on effect on customer satisfaction is the retailer’s expectations.

Most consumers’ dissatisfaction is a consequence of not encouraging accurate customer expectations at the product evaluation stage. In order to avoid this, we have to make sure that the entire system, from the customer entering the store for a purchase to the final sale, sets up the right expectations (Orren et al. 2005). Once the retailer feels confident about customers’ needs and concerns, the next challenge is to decide how to present the information to the customers in a way that supports the decision-making process. This is as much science as art. It is common for retailers to inflate their abilities in this regard. It’s been my experience that every retail store can benefit from constructive criticism and training in promoting the right message.

An understanding of the shoppers behaviour adds more clarity to the whole decision making process which is discussed in the preceding part of the review.

2.5 Principal influences on consumer behaviour

2.5.1 Demographic factors

->young consumers have different needs and wants from those who are old(govindarajan 2007 p 90)

Needs and wants of the consumers differ with respect to their age groups, occupation and income. People belonging to different age groups tend to share a set of values and cultural experiences. Women are keen enough to gather information on aspects of life. For example, women in the working community keep themselves updated whereas the retired women are likely to keep themselves informed (Ofcomconsumerpanel 2008a).

According to (Huddleston et al. 1993) women consumers ageing between 16 and 30 involve in most of the clothes shopping which instead has lead the clothing retailers to concentrate on age related products. Accordingly Amanda and Brigitte (2003) report states that women consumers ageing above forty are disengaged in most of the purchase activities in the UK. According to Evans (1989) it is the occupation and income which has a major influence of their buying behaviour, in comparison to the age group of women.

Huddleston et al. (1993) also found that women shoppers were older and earned higher income than male shoppers. Moreover, education, convenience orientation, experience orientation, channel knowledge, perceived distribution utility, and perceived accessibility were assumed to be strong predictors of clothes buying status; frequent buyer, occasional or non-buyer.

2.5.2 Psychological factors

2.5.2.1 Perception

->Perception is the process of selecting, organizing and interpreting information inputs to produce meaning. IE we chose what info we pay attention to, organize it and interpret it.

Information inputs are the sensations received through sight, taste, hearing, smell and touch.

Perception is the process of selecting, organizing and interpreting information inputs to produce meaning whereby, an individual selects data or information from the environment organizes it and then draws significance. Perception is basically a cognitive or thinking process and individual activities; emotions, feelings etc. are based on his or her perceptions of their surroundings or environment. Perception being an intellectual and cognitive process will be subjective in nature (Thang and Tan 2003).

Positive perception towards a particular brand or product helps the company to retain their customers, and especially in case of clothing retail stores the perception plays vital role in their development and it is made essential for the company to gain positive perception for their sustainability (Solomon 1996). Positive perceptions for clothing products can be gained through proper packaging, ambience, customer service, product availability, price and quality of the product.

2.5.2.2 Motivation

->A motive is an internal energizing force that orients a person’s activities toward satisfying a need or achieving a goal.

Actions are effected by a set of motives, not just one. If marketers can identify motives then they can better develop a marketing mix.

Motivation is based on needs and goals. The degree of relevance, or involvement, with the goal, is critical to how motivated the consumer is to search for information about a product. Uncovering consumer motives are one of the prime tasks of marketers, who try to teach consumer segments why their product will best fulfill their needs (Baker 1995).

Solomon (1996) explains motivation as a process that starts with some kind of motive or need, the drive or action to satisfy that need, and the fulfillment of the need. Understanding motivation is crucial to marketing. There are many complex motives behind every purchasing decision. It is understood from the words of Baker (1995) that the underlying motives of consumers are different from the stated motive and have multiple motives: manifest and latent. Manifest is when the product is known to the person and freely admitted. Latent is when the product is not known to the person and that they are very reluctant to admit.

2.5.2.3 Attitudes

->Knowledge and positive and negative feelings about an object or activity-maybe tangible or intangible, living or non- living…..Drive perceptions

Individual learns attitudes through experience and interaction with other people.

Consumer attitudes toward a firm and its products greatly influence the success or failure of the firm’s marketing strategy.

Attitudes are defined as a mental predisposition to act that is expressed by evaluating a particular entity with some degree of favor or disfavor (Roger 1984). Attitude describes a person’s relatively consistent evaluations, feelings, and tendencies towards a product or service and if fitted into a pattern, changing may require making many difficult adjustments. The role of attitude in marketing can be explained in terms of its importance in prediction, diagnostic value and also as relatively inexpensive information that is easily obtained. The different functions of attitude which is tabulated below:

Table 2: Different functions of attitude

Types

Functions

­­­Utilitarian function

Desire to achieve practical benefit

Related to basic principles of reward and punishment

Value derived from the success of finding the needed product

Value-expressive function

Expresses central value or self-concept

Forms attitude not because of benefits instead of what the product depicts.

Relevant to lifestyle which cultivates interest

Ego-defensive

function

Attitudes are formed to protect from threats

Helps to maintains self-esteem

Forces individuals to cope up with anxieties generated by internal conflicts

Knowledge function

Attitudes are formed as a result of a need for order, structure and meaning

It supplies a standard frame of reference to simplify the perception of a complex environment.Source: Derived from Solomon et al. (2006)

An attitude can form in several different ways, depending on the particular hierarchy of effects in operation. It can occur because of classical conditioning, in which an attitude object, such as the name, or it can be formed through instrumental conditioning, in which consumption of the attitude object is reinforced. Women in the UK evaluate the knowledge based on their likes and dislikes of towards a clothing product before making a purchase action. Women consumers generally purchase new products that are associated with a favorably viewed brand name. The attitude dominates women in selecting or for buying a clothing product due to the availability of many domestic brands and also the entry of international brands in the UK clothing market. Attitudes of the consumers can mostly transform when they receive new information from others or media.

Their favorable attitude toward the products is frequently the result of repeated satisfaction with other products produced by the same company. Women make trial purchases of new product categories in which they have little personal involvement. If they find the purchased product to be satisfactory, then they are likely to develop a favorable attitude toward it. Life is too complicated to predict what attitudes will persist and which will change but early socialization experiences do shape attitudes of women.

2.5.2.4 Life style

Marketers also measure lifestyles, which are patterns of behaviour which includes purchasing activities, interests, and opinions of buyers. These lifestyles can provide some additional insight into consumers’ consumption patterns. Some marketing researchers use Psychographic techniques that involve all of these factors to predict consumer behaviour (Evans (1989).

In terms of lifestyle, the values traditionally associated with women consumers dominate: open-mindedness, desire to travel, throwing parties, and the importance given to friends. Not surprisingly, fashion-related items highlight significant differences from the rest of the clothing retailers in the UK. In a nutshell, being hip and fashionable is above all a way for opinion clothing retailers to feel different; much more than choosing a dress code to show that one belongs to a given social group (Gutman and Mills 1992)

2.5.3 Social factors

2.5.3.1 Reference groups

->Individual identifies with the group to the extent that he takes on many of the values, attitudes or behaviors of the group members.

Families, friends, sororities, civic and professional organizations.

Any group that has a positive or negative influence on a persons attitude and behavior.

A reference group is defined as an ‘actual or imaginary individual or group conceived of having significant relevance upon an individual’s evaluations, aspirations, or beliefs’ (Solomon 1996). It consists of all the groups that have direct or indirect influence on an individual’s attitude or behaviour that can be symbolic or actual.

Childers & Rao (1992) examined reference groups as an influence to clothing choices and buying behaviour. Women are constantly faced with influences from reference groups. Reference groups expose women to new behaviour and lifestyles. Influence in attitudes and self-concept creates pressure for women and this conformity may affect actual product and brand choices

2.5.3.2 Social class

->Social class determines to some extent, the types, quality, quantity of products that a person buys or uses.

Social class can be defined as ‘the division of members of a society into a hierarchy of distinct status classes, so that members of each class have relatively the same status and the members of all other classes have either more or less status’ (Terrell 2002). Empirical evidence shows that a significant relationship exists between social participation and clothing behaviour pattern, especially for women. Women who are in a lower social economic status than their counterparts could be an irrelevant factor.

The main characteristics of Social class are:

Women within the same social class tend to behave more alike

Social class is hierarchical

Social class is not measured by a single variable but is measured as a weighted function of one’s occupation, income, wealth, education, status, prestige, etc.

Social class is continuous rather than concrete, with individuals able to move into a higher social class or drop into a lower class.

Social environment is represented by social influences such as reference group, culture, and social class. The social environment can be seen as the encounter in which clothing is considered as having meaning and values. Environmental influences, subcultures, and individual differences interact in determining consumer’s decision processes (Angel et al. 1990). The situational exogenous factors and clothing orientation factors had the most effect on the women’s selection of daily clothing.

2.5.3.3 Purchasing patterns

Buying behaviour patterns explain how and where a consumer shops. These patterns can be divided into the type of stores where a consumer elects to shop (i.e. store patronage) and the time and frequency that a consumer uses when shopping.

Store patronage is the consumer’s selection for a shopping outlet. Patronage patterns are theorized based on consumer characteristics including social factors (Terrell 2002). Patronage behaviour is influenced by a variety of characteristics at each stage in the decision process. Numerous studies have been conducted to explain patronage behaviour patterns for a variety of consumer types and specifically that clothing store patronage is related to fashion involvement for women consumers. Women consumers, who use clothing to enhance self-esteem, tend to shop more in speciality and better department stores. Similarly, buying behaviour is influenced by benefits sought and the social environment of the consumers (Dunne et al. 1995).

The time and frequency of shopping can be divided into four categories or time/frequency combinations of shopping: beginning of the season, clearance, as needed, and impulsive (Gutman and Mills 1992). The relationship between time and frequency for clothing buying and fashion involvement was found to be significant and also positively related where the majority of women carefully watched their clothing expenditures and frequently purchased clothing that are on sale or discounted.