Chapter III

Consumer Behaviour Models

1. Engel-Blackwell-Kollat Model:

It consists of four components:

(i) Information processing

(ii) Central control unit

(iii) Decision process

(iv) Environmental influences.

• Information processing :A shown in the diagram the information processing consists of

exposure, attention, comprehension and retention of the marketing and non-marketing
stimuli.

• For successful sales, the consumer must be properly and repeatedly exposed to the
message. His attention should be drawn, such that he understands what is to be conveyed
and retains it in his mind. Central control unit The stimuli processes and interprets the
 information received by an individual. This is done by the help of four psychological
factors.

• (a) Stores information and past experience about the product, which serves as a standard
for comparing other products and brands.

• (b) Evaluative criteria which could be different for different individuals.

• (c) Attitudes or the state of mind which changes from time to time, and helps in choosing
the product.

(d) The personality of the consumer which guides him to make a choice suiting his personality.
Decision process This chapter is dealt with later in the text, and consists basically of problem
recognition, internal and external search, evaluation and the purchase. The decision outcome or
the satisfaction and dissatisfaction is also an important factor which influences further decisions

2. Howard Sheth model:

• John Howard and JagadishSheth put forward the Howard Sheth model of consumer
behavior in 1969, in their publication entitled, ‘The Theory of buyer Behaviour’

• he Howard Sheth Model is a sophisticated integration of the various social,

psychological, and marketing influences on consumer choice into a coherent sequence of
information processing. It aims not only to explain consumer behavior in terms of
cognitive functioning but to provide an empirically testable depiction of such behavior
and its outcomes (Howard 1977)

• The Howard Sheth model of consumer behavior suggests three levels of decision
making:

• The first level describes extensive problem-solving. At this level, the consumer does not
have any basic information or knowledge about the brand and he does not have any
preferences for any product. In this situation, the consumer will seek information about
all the different brands in the market before purchasing.

• The second level is limited problem-solving. This situation exists for consumers who
have little knowledge about the market, or partial knowledge about what they want to
purchase. In order to arrive at a brand preference, some comparative brand information is
sought.

• The third level is habitual response behavior. At this level, the consumer knows very
well about the different brands and he can differentiate between the different
characteristics of each product, and he already decides to purchase a particular product.
• According to the Howard Sheth model of consumer behavior, there are four major sets of
variables; namely:

• 1. Inputs:These input variables consist of three distinct types of stimuli (information

sources) in the consumer’s environment. The marketer in the form of product or brand
information furnishes physical brand characteristics (significative stimuli) and verbal or
visual product characteristics (symbolic stimuli).

• Perceptual and Learning Constructs: The central part of the model deals with the
psychological variables involved when the consumer is contemplating a decision. Some
of the variables are perceptual in nature and are concerned with how the consumer
receives and understands the information from the input stimuli and other parts of the
model. For example, stimulus ambiguity happened when the consumer does not
understand the message from the environment

• Outputs: The outputs are the results of the perceptual and learning variables and how
the consumers will respond to these variables (attention, brand comprehension, attitudes,
and intention).

• Exogenous(External) variables: Exogenous variables are not directly part of the

decision-making process. However, some relevant exogenous variables include the
importance of the purchase, consumer personality traits, religion, and time pressure
 •

3. Bettman Information Processing Model of Consumer Choice

Bettman (1979) in his model describes the consumer as possessing a limited capacity for
processing information. He implicates that the consumers rarely analyze the complex alternatives
in decision making and apply a very simple strategy.
In Bettman Information Processing Model, the consumer is portrayed as possessing a limited
capacity for processing information. When faced with a choice, the consumer rarely undertakes
very complex analyses of available alternatives. Instead, the consumer typically employs simple
decision strategies or heuristics. These simplifying decision rules assist the consumer in arriving
at a choice by providing a means for sidestepping the over overburden task of assessing all the
information available about all the alternatives.
In Bettman Information Processing Model, there are seven major stages.
• Processing Capacity: In this step, he assumes that the consumer has a limited capacity
for processing information, consumers are not interested in complex computations and
extensive information processing. To deal with this problem, consumers are likely to
select choice strategies that make product selection an easy process.
• Motivation: Motivation is located in the center of the Bettman Information Processing
Model, which influences both the direction and the intensity of consumer choice for more
information in deciding between the alternatives. Motivation is provided with a hierarchy
of goals mechanism that provides a series of different sub-goals to simplify the choice
 selection. This mechanism suggests that the consumers own experience in a specific area
of the market and he doesn’t need to go through the same hierarchy every time to arrive
at a decision, which makes this mechanism serves as an organizer for consumer efforts in
making a choice. No concern was given on religious motives, and how religion may
motivate the consumer in his decision. Most of the general theories of motivation such
as Maslow’s hierarchy of needs (1970) emphasize self-achievement, the need for power,
and the need for affiliation.
• Attention and Perceptual Encoding: The component of this step is quite related to the
consumer’s goal hierarchy. There are two types of attention; the first type is voluntary
attention, which is a conscious allocation of processing capacity to current goals. The
second is involuntary attention, which is an automatic response to disruptive events (e.g.,
newly acquired complex information). Both different types of attention influence how
individuals proceed in reaching goals and making choices. The perceptual encoding
accounts for the different steps that the consumer needs to perceive the stimuli and
whether he needs more information.
• Information Acquisition and Evaluation: If the consumer feels that the present
information is inadequate, he will start to look for more information from external
sources. The newly acquired information is evaluated and its suitability or usefulness is
assessed. The consumer continues to acquire additional information until all relevant
information has been secured, or until he finds that acquiring additional information is
more costly in terms of time and money.
• Memory: In this component, the consumer keeps all the information he collects, and it
will be the first place to search when he needs to make a choice. If this information is not
sufficient, no doubt he will start looking again for external sources.
• Decision Process: This step in the Bettman Information Processing Model indicates that
different types of choices are normally made associated with other factors, which may
occur during the decision process. Specifically, this component deals with the application
of heuristics or rules of thumb, which are applied in the selection and evaluation of a
specific brand. These specific heuristics a consumer uses are influenced by both
individual factors (e.g., personality differences) and situational factors (e.g., the urgency
of the decision); thus it is unlikely that the same decision by the same consumer will
apply in a different situation or another consumer in the same situation.
 • Consumption and Learning Process: In this stage, the model discusses the future
results after the purchase is done. The consumer in this step will gain experience after
evaluating the alternative. This experience provides the consumer with information to be
applied to future choice situations. Bettman in his model emphasizes on the information
processing and the capacity of the consumer to analyze this information for decision
making, but no explanation was given about the criteria by which the consumer accepts
or refuses to process some specific information.
4. HCB Model:
The HCB model incorporates external and internal influences, self-concept, desires,
needs, and the consumer decision making process from problem recognition to post-
purchase.

Involvement in Consumer Behaviour

Consumer involvement is considered as an important variable that can help explain how
consumers process the information and how this information might influence their purchase or
consumption related behavior. However, there is wide agreement that the degree of involvement
has a very significant effect on consumer behavior.

Herbert Krugman, a researcher is credited with his contribution to the concept of consumer
involvement. According to him, consumers approach the marketplace and the corresponding
product/service offerings with varying levels and intensity of interest and personal importance.
This is referred to as consumer involvement.

Involvement variables are believed to precede involvement and influence its nature and extent.
These variables are believed to be the sources that interact with each other to precipitate the
level of consumers involvement at any particular time and situation. The extent of risk
perception the consumer has with purchase decision can also influence the level of involvement

There are several broad types of involvement related to the product, the message, or the
perceiver.

 Product involvement refers to a consumer’s level of interest in a certain product.

Marketers communicate many sales promotions to increase consumer involvement in a
product. Tata Indica V2 sponsored a contest in which participants were to submit five
words that describe the car starting with the letter “V.”
 Advertising involvement refers to the consumer’s interest in processing the ad messages.
Television is said to be low-involvement medium and consumers process information in
a passive manner. In contrast, print is a high-involvement medium as the readers actively
process information.
 Purchase situation involvement may occur while buying the same item in different
contexts. For example, when a consumer wants to impress someone, she/he may buy a
different brand that reflects elegance and taste in a better way than the usual one that
she/he buys.
Nominal decision-making is also referred to as nominal problem solving, habitual decision-
making, or routine problem solving. Recognition of need is likely to lead directly to an intention
to buy. Information processing is very limited or non-existent. There is generally low-
involvement with most low priced and frequently purchased products, which are consumed on
an ongoing basis and involve nominal decision-making.

Limited decision-making is usually more straightforward and simple. It involves internal (long-
term memory) and limited external search, consideration of just few alternatives, simple
decision rules on a few attributes and little post purchase evaluation. As pointed out earlier, it
covers the middle ground between nominal and extended decision-making. Buyers are not as
motivated to search for information, or evaluate each attribute enthusiastically, but actually use
cognitive shortcuts. When the level of consumer involvement is lowest, limited decision-making
may not be much different than nominal decision-making.

Extended decision-making corresponds most closely to the traditional decision-making

perspective. Such decisions involve extensive internal (long-term memory) and external (outside
sources) information search followed by a rigorous evaluation of several alternatives because
consumers do not possess any meaningful information about the product or service and need
lots of it. The evaluation often involves careful consideration of attributes of one brand at a time,
and taking stock of how the attributes of each brand measure up to a set of desired
characteristics. All this happens in response to a high level of consumer’s involvement in
making a purchase decision. Such complex decisions are relatively few and may relate to buying
a computer, stereo system, washing machine, laser printer, or a new house. Post purchase
evaluation is more likely to be complex and dissonance causing.

Post Purchase Behaviour

Post Purchase Behaviour defines the overall reaction and response of a customer after buying a
product or service. Generally after a product purchase the buyer can either be happy and fine or
can regret the purchase altogether. In this case the customer undergoes post purchase dissonance.
The modern customers have lot of options to express their post purchase feelings and reactions.
Customers can use social media, reviews and other means to immediately recommend or
complain about a product.

Importance of Post Purchase Behaviour

Understanding the customer behaviour after a sale has been made is very very important. Many
organizations tend to ignore the post purchase behavior of a customer as the sale has already
been made but what is important here is that if the customers are not happy then the probability
of repeat business would reduce significantly. Repeat business is one of the parameters on which
a business can sustain for a long term. The post purchase dissonance can impact the brand image
and the overall sales in the market due to poor word of mouth. If the customer is happy after a
purchase, they would not only come back to buy again but also they would recommend the
product to others as well helping the brand and sales further.
Aftermarket support is very important these days to counter post purchase behavior dissonance.
There is still some time in which the customer issues can be resolved. If a customer complains
about an issue and it is resolved, it would still keep the customer happy and give the brand
another chance. This is only possible if it was due to temporary issue or defect. If the customers
in general are not happy with the core product quality and features, then the overall customer
satisfaction would be very low and the perception and brand image would suffer.
This dissonance can be due to:
1. Large number of alternatives
2. The other alternatives have better features
3. Performance of the product
4. High financial commitment towards the product but derived value is less
5. Low durability of the product
These factors should be addressed in every possible iteration to make products better and reduce
the chances of dissonance.

Customer Satisfaction
Customer satisfaction can be defined as the measure of how clients are satisfied with a
company's commodities. These measurements are an identifier of customers loyalty and
intentions of buying products from a company.

Customer satisfaction is defined as a measurement that determines how happy customers are
with a company’s products, services, and capabilities. Customer satisfaction information,
including surveys and ratings, can help a company determine how to best improve or changes its
products and services.

An organization’s main focus must be to satisfy its customers. This applies to industrial firms,
retail and wholesale businesses, government bodies, service companies, nonprofit organizations,
and every subgroup within an organization.

Model of Customer Satisfaction

Different Models of Consumer Satisfaction:

Disconfirmation Model of Consumer Satisfaction

Essentially customer satisfaction is the consumer’s evaluation of how well the firm (usually a
service firm) has lived up to their promises.
Consumers are compare two aspects (prior expectations to actual delivery) they are essentially
confirming (or disconfirming) how well the organization has delivered. In services marketing
textbooks, this process is described as the Disconfirmation Model of Customer Satisfaction.

Equity Theory:

Equity theory in customer satisfaction is the idea that individuals require consistency between
what was expected and what was experienced. Consistency between both sides of this equation is
key to providing customers with a positive customer experience.

Learning how to manage expectations and consistently deliver an experience that meets and
exceeds them builds goodwill and trust, which leads to strong customer satisfaction.

From my understanding, equity theory in customer satisfaction applies to any kind of purchase.
The buyer has a sense of how the product or service is going to turn out, with what to expect
from the business or brand.

When that buying decision takes place, the seller needs to make sure that the experience is
consistent with the seller’s promise of what is to be received. If not, then the buyer has been
provided with an uneven or inequitable exchange of money for goods or services. This causes
dissatisfaction.

Attribution Theory:

The Attribution theory has been mostly used in dissatisfaction/ complaining behavior models
than in satisfaction models.

According to this theory of the customer satisfaction model, consumers are regarded as rational
processors of the information who seek out reasons to explain why a purchase outcome, for
example, dissatisfaction, has occurred. These reasons may include the product itself, the service,
the price, and even the person who sold the product.

Frequently these reasons are highly cor, related to each other, a state of affairs we refer to as
inter-correlated attributions. In that case, we can use a simpler model that attributes the “blame”
to one of these reasons. The most frequently occurring reason is then called the primary cause.

The attribution theory was developed in the domain of social psychology by Fritz Heider,
Dorwin Cartwright, and Leonard Bostwick in a publication entitled “The Psychology of
Judgment”. In this publication, the authors pointed out that people are rational in their judgment
processes and that there are conditions under which their judgment is rational.

These researchers argued that there are three criteria for attribution to be made: consistency,
consensus, and coherence or correspondence.

The consistency criterion includes the notion that when an outcome occurs, people need to find
reasons to account for it.

Cognitive Dissonance Theory:

cognitive dissonance relates to consumers' expectations, feelings about brands and internal logic
when deciding to buy something. Marketers try to be aware of potential conflicts or expectations
that might affect buying decisions.

Here are five steps to using cognitive dissonance in marketing:

1. Encourage consumer beliefs
2. Use a consistent tone
3. Include relevant facts
4.Appeal to emotions
Consumer delight is the superior experience of the consumers. When the company provides such
a product which is much more than the expectations of the consumers, then this creates a positive
emotional reaction by the consumer which is also known as WOW effect. The consumer delight
helps in creating a competitive advantage as the consumer delight is directly affected by the sale
and profitability of a company by distinguishing its brand, product and loyalty. The delighted
customer can do a lot for the company. Consumer delight is a key to success. Customers will be
delighted when what is provided is more than what is promised or expected. If what the company
provides exceeds what is promised or expected then that will be sufficient to create delight. It
may be only a small delight, a short delight or a fleeting delight, but it will be delight.

Definition:

Consumer delighted can be defined as: “The result of delivering a product or services that exceed
consumer expectations”.

According to Tom Peters, “Customer satisfaction is no longer good enough to survive in today‟s
competitive market. What is needed is customer delight.”

Need of Customer Delight

The main factor which needs to be considered is the perspective why the customer delight is
needed. The delighted customers remain loyal to the company. They repeatedly buy the products
of the company. Moreover a good word of mouth is provided by them. Delighted customers can
increase the profits of the company to manifold. A new acquired customer cost about five times
more than that of a delighted customer of the company.
 Delighted Consumers are an asset: The delighted consumers have a positive impact and
they also inform many other people to buy the company‟s products. Thus, they are a
sound investment and many companies have understood their impacts.
 Consumer services leads to consumer delight: Life without creativity is just like coca
cola without the fizz. The tremendous advancements in the field of communication,
transportation have made world a global village.
Consumer Dissatisfaction:

A collection of consumer dissatisfaction responses is known as complaint behavior. It is an

outward display of unhappiness, but it is only one factor that influences this behavior. Complaint
behavior may be broken down into several sorts of responses, as well as a process.

Introduction to Family Decision-Making

What is Family Decision-Making?

Family decision-making refers to the process by which families, as a unit, make choices and
reach decisions regarding various purchases and consumption activities. It’s a complex interplay
of individual preferences, roles, and dynamics within the family structure.

Family Buying Influences

Nature and Types of Influences

1. Influence of Family Members: Different family members exert influence based on their
preferences and needs. Parents, children, and even extended family members can play a
role in shaping decisions.
2. Consumer Socialization: How individuals learn to make consumption decisions is
influenced by their family’s values, beliefs, and experiences.
3. Intergenerational Influences: The values and preferences passed down from one
generation to another can significantly impact decision-making.

Family Decision-Making Process

Family Role Structure and Buying Behavior

1. Roles within the Family: Family members often assume specific roles in decision-
making, such as initiators, influencers, decision-makers, buyers, and users.
2. Decision-Making Dynamics: Understanding how these roles interact and who holds the
most influence is crucial for marketers.

The Influence of Children

1. Pester Power: Children can have a significant say in family decisions, especially when it
comes to products or experiences they desire.
2. Education and Responsibility: Families also shape children’s understanding of consumer
behavior, teaching them about budgeting, saving, and responsible spending.
The Family Life Cycle Concept

Implications of Family Decision-Making for Marketing Strategy

1. Life Stages: Families go through various life stages, from newlyweds to empty nesters.
Each stage has unique needs and priorities that influence their purchasing decisions.
2. Tailored Marketing: Marketers can create targeted campaigns and products that resonate
with families at different life stages.
3. Family-Centric Marketing: Recognizing the importance of family values and bonds can
help build emotional connections with consumers.

Conclusion

Family decision-making is a multifaceted process that blends individual preferences, roles, and
societal influences. Marketers must recognize the complexities of these dynamics to create
effective strategies that resonate with families and their unique needs. By understanding the role
of family in consumer behavior, businesses can build stronger relationships with their target
audience.
Dynamics of Husband – Wife Decision Making:
Marital status has a significant influence on consumer decision-making. Studies have shown that
the relative influence of husbands and wives in important purchase decisions is similar across
different cultural and social contexts, such as in India and the US . Family structure, including
male-dominated, wife-dominated, joint decision-making, or egalitarianism styles, also plays a
role in decision-making styles within an Islamic culture . Additionally, research has found that
decision-making styles vary across different stages of the decision process and cultures, such as
in the People's Republic of China and the United States . Furthermore, the exercise of family
power by wives has been found to have a significant influence on the innovative consumer
decisions made by their husbands . Finally, one's relationship with their spouse can fuel
materialistic desires, with materialistic individuals seeking external validation through
consumption and show-off .

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