Buying decision process

A buying decision process is the process a customer goes through when buying a product. It can be seen as a particular form of a cost–benefit analysis. The buying decision model has gone through lots of interpretation by scholars.^[1][2]  Although the models vary, there is a common theme of five stages in the decision process.

Stages

These stages were first introduced by Engel, Blackwell and Kollat in (1968).^[3] The stages are:

1. Problem/Need recognition
2. Information search
3. Evaluation of alternatives
4. Purchase decision
5. Post-purchase behavior

These five stages are a framework to evaluate customers' buying decision process. However, it is not necessary that customers get through every stage, nor is it necessary that they proceed in any particular order. For example, if a customer feels the urge to buy chocolate, he or she might go straight to the purchase decision stage, skipping information search and evaluation.^[4]

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 cannot take place. The need can be triggered by internal stimuli (e.g. hunger, thirst) or external stimuli (e.g. advertising).^[4]  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 addressed through 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 buyers' effort at searching the internal and external business environments to identify and observe sources of information related to the focal buying decision.^[5] Consumers can rely on print, visual, and/or voice media for getting information.

Evaluation of alternatives

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.^[4]  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".^[4]  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),^[4] 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,^[6] 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.^[7] 

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.

References

1. Engel, James F., Kollat, David T. and Blackwell, Rodger D. (1968) Consumer Behavior, 1st ed. New York: Holt, Rinehart and Winston 1968
2. Nicosia, Francesco M. (1966) Consumer Decision Process. Englewood Cliffs, N.J.: Prentice Hall, 1966
3. Dewey, John (2007). How we think. New York: Cosimo. ISBN 9781605200996.
4. 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
5. Bunn, Michele D. (January 1993). "Taxonomy of Buying Decision Approaches". Journal of Marketing (American Marketing Association) 57 (1): 38–56. doi:10.2307/1252056. Retrieved 9 February 2013.
6. Blythe, Jim (2008) Consumer Behavior. U.K., Thompson Learning, 2008
7. Foxall, Gordon.R., (2005) Understanding Consumer Choice USA, Palgrave Macmillan, 2005