The Consumer Buying Decision Process

The purchase is only the visible part of a more complex decision process created by the
consumer for each buying decision he makes. But what happens before and after this
purchase? What are the factors influencing the choice of product purchased by the
consumer?

Today, let’s focus on the Consumer Buying Decision Process and the stages that lead a
shopper to purchase a new product.

Engel, Blackwell and Kollat have developed in 1968 a model of consumer buying decision
process in five steps: Problem/need recognition, information search, evaluation of
alternatives to meet this need, purchase decision and post-purchase behavior.

I. Need recognition / Problem recognition :

The need recognition is the first and most important step in the buying process. If there
is no need, there is no purchase. This recognition happens when there is a lag between
the consumer’s actual situation and the ideal and desired one.

However, not all the needs end up as a buying behavior. It requires that the lag between
the two situations is quite important. But the “way” (product price, ease of acquisition,
etc.) to obtain this ideal situation has to be perceived as “acceptable” by the consumer
based on the level of importance he attributes to the need.

For example, you have a pool and you would like someone to take care of regularly
cleaning it instead of you (ideal situation) because it annoys you to do it yourself (actual
situation). But you don’t judge the “way” to reach this ideal situation (pay $250 / month
for a specialized company) as “acceptable” because its price to obtain it seems too high.
Especially compared to the relatively low level of importance you attach to it. So you
won’t have a purchase behavior in this situation.

On the other hand, the ability to be able to go to your work by car in 20 minutes every
morning (ideal situation) rather than lose three hours in transit because you do not have
a car and you live in the countryside (actual situation) is something that means a lot to
you. So you will have a buying behavior to purchase a car. Even if the price is important.

In addition to a need resulting from a new element, the gap between the actual situation
and the ideal situation may be due to three cases. The current situation has not changed,
but the ideal situation has (a neighbor told you about the possibility – that you did not
know – to clean the pool by a specialized company). Or, the ideal situation is still the
same but it’s the actual situation has changed (you’re tired of cleaning your pool by
yourself). Or finally, the two situations have changed.
The recognition of a need by a consumer can be caused in different ways. Different
classifications are used:

 Internal stimuli (physiological need felt by the individual as hunger or thirst) which
opposes the external stimuli such as exposure to an advertisement, the sight of a
pretty dress in a shop window or the mouth-watering smell of a french “pain au
chocolat” when passing by a bakery.

 Classification by type of needs:

o Functional need: the need is related to a feature or specific functions of
the product or happens to be the answer to a functional problem. Like a
computer with a more powerful video card to be able to play the latest
video games or a washing machine that responds to the need to have clean
clothes while avoiding having to do it by hand or go to the laundromat.
o Social need: the need comes from a desire for integration and
belongingness in the social environment or for social recognition. Like
buying a new fashionable bag to look good at school or choose a luxury car
to “show” that you are successful in life.
o Need for change: the need has its origin in a desire from the consumer to
change. This may result in the purchase of a new coat or new furniture to
change the decoration of your apartment.

 The Maslow’s hierarchy of needs: Developed by the eponymous psychologist, this

is one the best known and widely used classifications and representations for
hierarchy of needs. It specifies that an individual is “guided” by certain needs that
he wants to achieve before seeking to focus on the following ones:
o 1. Physiological needs
o 2. Safety needs
o 3. Need of love and belonging
o 4. Need of esteem (for oneself and from the others)
o 5. Need of self-actualization

II. Information search

Once the need is identified, it’s time for the consumer to seek information about
possible solutions to the problem. He will search more or less information depending on
the complexity of the choices to be made but also his level of involvement. (Buying pasta
requires little information and involves fewer consumers than buying a car.)

Then the consumer will seek to make his opinion to guide his choice and his decision-
making process with:
  Internal information: this information is already present in the consumer’s
memory. It comes from previous experiences he had with a product or brand and
the opinion he may have of the brand.

Internal information is sufficient for the purchasing of everyday products that the
consumer knows – including Fast-Moving Consumer Goods (FMCG) or Consumer
Packaged Goods (CPG). But when it comes to a major purchase with a level of
uncertainty or stronger involvement and the consumer does not have enough
information, he must turns to another source:

 External information: This is information on a product or brand received from and

obtained by friends or family, by reviews from other consumers or from the press.
Not to mention, of course, official business sources such as an advertising or a
seller’s speech.

During his decision-making process and his Consumer Buying Decision Process, the
consumer will pay more attention to his internal information and the information from
friends, family or other consumers. It will be judged more “objective” than these from an
advertising, a seller’s speech or a commercial brochure of the product.

III. Alternative evaluation

Once the information collected, the consumer will be able to evaluate the different
alternatives that offer to him, evaluate the most suitable to his needs and choose the
one he think it’s best for him.

In order to do so, he will evaluate their attributes on two aspects. The objective
characteristics (such as the features and functionality of the product) but also subjective
(perception and perceived value of the brand by the consumer or its reputation).

Each consumer does not attribute the same importance to each attribute for his decision
and his Consumer Buying Decision Process. And it varies from one shopper to another.
Mr. Smith may prefer a product for the reputation of the brand X rather than a little
more powerful but less known product. While Mrs. Johnson has a very bad perception
of that same brand.

The consumer will then use the information previously collected and his perception or
image of a brand to establish a set of evaluation criteria, desirable or wanted features,
classify the different products available and evaluate which alternative has the most
chance to satisfy him.

The process will then lead to what is called “evoked set”. “The evoked set” (aka
“consideration set”) is the set of brands or products with a probability of being
purchased by the consumer (because he has a good image of it or the information
collected is positive).
On the other hand, “inept set” is the set of brands or products that have no chance of
being purchased by the shopper (because he has a negative perception or has had a
negative buying experience with the product in the past). While “inert set” is the set of
brands or products for which the consumer has no specific opinion.

The higher the level of involvement of the consumer and the importance of the purchase
are stronger, the higher the number of solutions the consumer will consider will be
important. On the opposite, the number of considered solutions will be much smaller for
an everyday product or a regular purchase.

IV. Purchase decision

Now that the consumer has evaluated the different solutions and products available for
respond to his need, he will be able to choose the product or brand that seems most
appropriate to his needs. Then proceed to the actual purchase itself.

His decision will depend on the information and the selection made in the previous step
based on the perceived value, product’s features and capabilities that are important to
him.

But his Consumer Buying Decision Process and his decision process may also depend or
be affected by such things as the quality of his shopping experience or of the store (or
online shopping website), the availability of a promotion, a return policy or good terms
and conditions for the sale.

For example, a consumer committed to the idea of buying a stereo of a well-known brand
could change his decision if he has an unpleasant experience with sellers in the store.
While a promotion in a supermarket for a yogurt brand could tip the scale for this brand
in the consumer’s mind who was hesitating between three brands of his “evoked set”.

V. Post-purchase behavior

Once the product is purchased and used, the consumer will evaluate the adequacy with
his original needs (those who caused the buying behavior). And whether he has made the
right choice in buying this product or not. He will feel either a sense of satisfaction for the
product (and the choice). Or, on the contrary, a disappointment if the product has fallen
far short of expectations.

An opinion that will influence his future decisions and buying behavior. If the product
has brought satisfaction to the consumer, he will then minimize stages of information
search and alternative evaluation for his next purchases in order to buy the same brand.
Which will produce customer loyalty.
On the other hand, if the experience with the product was average or disappointing, the
consumer is going to repeat the 5 stages of the Consumer Buying Decision Process
during his next purchase but by excluding the brand from his “evoked set”.

The post-purchase evaluation may have important consequences for a brand. A satisfied
customer is very likely to become a loyal and regular customer. Especially for everyday
purchases with low level of involvement – such as Fast-Moving Consumer Goods
(FMCG) or Consumer Packaged Goods (CPG). A loyalty which is a major source of
revenue for the brand when you combine all purchases made by customer throughout
his entire life (called “lifetime customer value”). The “Holy Grail” that all brands in the
industry are trying to achieve.

Positive or negative, consumers will also be able to share their opinion on the brand.
Whether in their family or by word-of-mouth. Or on a much broader scale now with
social networks or on consumer product review websites. A tendency not to be
overlooked because now with the Internet, an unhappy customer can have a strong
power to harm for a brand.

That’s why that’s important for companies to have awareness of that matter. In addition
to optimizing the customer experience, a guarantee (for example, for a washing
machine), an efficient customer service and a specific call center are some of the assets
that can be developed to improve post-purchase behavior if there is any trouble with the
product.

An example of Consumer Buying Decision Process

Nothing like a real example to better understand the five stages of the Consumer Buying
Decision Process. Maybe this situation sounds familiar to you.

Stage 1 – Need recognition: It’s sunday night. You’re hungry (internal physiological stimuli)
and there is nothing in the fridge. You will order food (statement of need).

Stage 2 – Information search: You already have ordered to the Indian restaurant in your
street last month (internal information). A friend recommended a pizzeria in your
neighbourhood (external information from environment). And this morning you’ve found a
flyer for a sushi restaurant in your mailbox (external information from advertising).

Stage 3 – Alternative evaluation: You have a bad opinion of the Indian restaurant since
you’ve been sick the last time (inept set). The pizzeria is both recommended by your
friend and also happens to be a well-known brand (positive perception – evoked set). As
for the sushi restaurant, it got good reviews on Trip advisor (positive perception – evoked
set).
Stage 4 – Purchase decision: After evaluating the possibilities, you’ve decided to choose
the well-known pizza delivery chain. In addition, a new episode of your favorite TV show
is broadcasted tonight on TV.

Stage 5 – Post-purchase behavior: The pizza was good (positive review). But you know
there was too many calories and you regret a little bit (mixed feelings about yourself). The
next time you will choose the sushi restaurant. There is less fat in sushi than pizza (next
purchase behavior)!