Marketing is defined by the American Marketing Association as “the activity, set of institutions and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large.” Basically, the main function of all marketing activity is to satisfy customers needs by delivering value.
However, to deliver value, marketers must first communicate the value of their product. And to communicate value effectively they must decide on a message or messages that will strike a chord with the audience. So, how do they, or how do you, if you are responsible for marketing in your organization, decide what message to convey?
Small businesses can benefit by thinking about what goes into marketing and how their audience will receive that message. This post helps small business owners understand what steps consumers take in deciding what products to purchase. Once you, as a business owner understand these steps, you can develop your own marketing strategy for your business or make more informed decisions pertaining to an existing marketing strategy . This could boost sales and attract new customers.
The steps consumers take in deciding what products to purchase is called the customer decision process.
The customer (or consumer) decision process, according to the American Marketing Association, is ” the process of selecting from several choices, products, brands, or ideas.” This is an ongoing process where consumers seek to satisfy their needs and desires. There are five steps to the customer decision process and different types of decision making based on the involvement of the decision.
By involvement I mean the relative importance or perceived consequences of the purchase to the customer.
For example purchasing bread at your supermarket has a very low level of involvement. You have purchased bread plenty of times and may even have a brand that you always purchase. However, purchasing your first car is different. You are investing more money and may even want to research the make and model to make the right decision.
The amount of involvement is often determined by three factors that influence the decision making process. These are internal influences or perceptions, situational, and social influences.
Once the importance of the decision is determined the type of decision making ensues.
The Different types of decision making are:
- Extended problem solving– This is when the customer carefully goes through each step due to a high involvement. For example, the purchase of your car as mentioned before.
- Habitual decision making– Customers do not to go through the process at all because of the low involvement and familiarity with the product. For example, purchasing the same bread you do every time you go to the grocery store.
The steps in the Customer decision process are:
1. Problem or Need Recognition– A customer recognizes a need or desired state.
For example, as a customer you may realize that you drop your phone a lot and break your screen. Otter box realized this regular problem and made their product, a durable phone case, to solve it.
Many products, like otter box, seek to solve a problem or a gap in the market. When your product does this, they appeal to the customer through this first step in the customer decision process. Marketers can focus on the problem they are solving in their promotions.
However, not all products fulfill a need but rather a want. This part pertains to a consumers desired state. A customer desires a beer. Therefore, they seek to purchase one. However, what type of beer do they desire and what components or persona of that beer do they want?
This leads to the next step in the customer decision process.
2. Information search- This is where a customer searches for information to make a reasonable decision.
They find the qualities of the products they are considering and compare them with what they desire and what components they like.
For example, Budweiser presents itself as an American beer. This creates a nostalgia with its brands and an attractiveness to those that want to stay true to their country.
3. Evaluate Alternatives- From the information customers find about the various amounts of brands he has researched, the customer narrows down the choices for evaluation. He look at the features that differentiate the products.
Evaluating criteria are the dimensions consumers use to compare competing product alternatives. These include things like price, quality, and packaging.
Marketers can hone in on these dimensions to create a more competitive advantage. They can make their package visually appealing, make their price competitive, and guarantee a durable and easy to use product.
4. Product Choice- The customer then averages the information or characteristics he found about the brands to make a decision. This is called compensatory decision rules.
Those products that have the best average of characteristics that differentiates the brand from their competition is purchased by the customer.
However, there are some colloquialisms that cause customers to lean towards one direction or another when purchasing a product.
5. Post purchase evaluation- Finally, the customer weighs their expectations prior to the purchase to the actual product. They develop an overall attitude towards the product after purchasing it based on if their expectations were fulfilled. This attitude can be negative or positive and is often determined by the value they get from the product.
So now, we see it comes full circle. Marketers seek to satisfy customers needs by delivering value and consumers develop an opinion about a product based on how well that value was received.
This why making sure you understand your product and what your customers gains from the product is vital for a marketing strategy. Put yourself in the place of the customer purchasing your product and decide what components would be most appealing to you. Would you purchase your product at the end of the decision process based on what you have marketed?
Need Help with the Customer Decision Process?
Your local Kansas SBDC can help with all different types of marketing techniques. They can help you understand the variables marketers use and how you can use them for your business.
About our author
Abby Cahn is a Spring 2018 marketing intern for Kansas SBDC. She went to Cowley County Community College as a Secondary Art and English Education Major and graduated with an Associates in Arts. However, she decided business was the most beneficial route for her. Currently, she is a Fort Hays State University undergraduate student pursuing her degree in Business Management with a concentration in Entrepreneurship. She enjoys creating artwork, reading, and assembling floral arrangements. Abby hopes to open her own small business some day. She wants to teach people how to create floral arrangements and artwork, as well as sell them, from a small shop in Kansas. By doing this, she hopes to promote creativity and art as an outlet for communication, learning, and relaxation. She knows that one day if she needs assistance with her business she will go to her local Kansas SBDC.