Why would you even want to read this?
I have often been asked about the Consumer Decision Making
process. Questions like ‘What would make a consumer buy this product/ brand?’
OR ‘Why are consumers not buying our product?’ are pretty common. Think through
and you would realize that this should be the most important question for any
marketer as the ultimate objective is to make customers/ consumers buy your
product. If you search the Internet, you would find a wide variety of
literature ranging from theories on Customer Involvement, Need and Motivation,
Influencers and beyond; You would even find literature suggesting that human
mind is too lazy and hence use shortcuts while taking purchase decisions.
So, which one is correct? Well!! Consumer Decision Making
Process is like a Holy Grail of Marketing – People may have misconceptions
about their knowledge but I am yet to meet or read someone who has all the
answers.
Why the Confusion?
Don’t get me wrong. I am not suggesting that existing
theories and models don’t serve their purpose. They do – In fact, there are
successful practitioners of most of the prevailing theories and models based on
them. However, as with any theory/ model related to human behavior, one cannot
have a universal law just like we use to have in science. It is simply because
there are too many factors/ variables involved and also too many scenarios in
which the said theory has to be observed & proven correct to make it
universal. Unfortunately, even if any organization has the courage to deploy
the maximum resources in terms of time, manpower and money then also nothing
would be achieved as we simply cannot envision all the possible scenarios.
What I am offering in this article?
My belief has been that for Consumer Decision Making Process,
a generalized law/ model/ theory is sufficient to serve most of our requirements.
This is precisely the reason why many of the existing theories were accepted in
first place – they seemingly worked for certain situations. As we become more
aware of the human behavior with advanced thinking, experiments and data, a
newer and possibly better model was proposed and would be proposed in future.
In this article, I would like to explain, in brief, my
understanding of the Consumer Decision Making process. This is based on my
readings, trend analysis, observation and interaction with various consumer
groups over the course of last decade as a Market Researcher. As stated
earlier, this knowledge is fluid and would (most certainly) get refined in the
coming days.
The Model:
My model is simple: it has two parts. The first part states
that when a customer is making a purchase decision, the selection of
options and decision on budget is often dictated by a mix three key variables: Emotional,
Aspirational & Rational. Before I come to the second part, I think there
is a need to explain the three elements I described in above definition.
Emotional (E): Elements which arouse strong associations with the brand/
product. It usually comes with familiarity, prolonged exposure to product or
communication and is often expressed in elements like Brand, Trust &
Popularity.
Aspirational (A): While the word is self-explanatory, it is usually led by the
urge to move ahead in life and is influenced by parameters like Visibility,
Social Image and Acceptance in the Social Circle.
Rational (R): Refers to those parameters which appeals to reason or logic.
Usual entrants over here would be Functional Benefits like Product Features,
Price, Value derived vis-à-vis money paid (also known as VFM) etc.
One can argue that Aspiration is also an Emotion (which is
true) – but it has such a strong and distinct role in decision making process
that it has to be kept as a separate entity. There is another possible distinct parameter, Social (S) - it refers to the pressure of Society (like, what will others think) in making the consumer decision. However, basis my observation, I am yet to make a convincing case for Social to be included in this model. Till the time this happens, I would like to stick to EAR and not EARS model of Decision Making.
The second part of the model is as follows: In almost all
the decisions, all the three factors would be at play – the weightage of each
is, however, dependent on the category, persona of decision maker, the reason
for purchase and current ability to stretch financially.
I can even illustrate the above in the form of equation:
Consumer Decision = aR + bE + cA + X,
Where a, b & c are the coefficients/ weightage attached
to each of the factor & X is the constant.
The concept can also be visualized in the form of following
image:
An Example:
We would take a simple case. Suppose, you want to eat Chaat
(an Indian Snack). You have the following option to eat it from:
Nearby Vendor (Convenient but not Hygienic)
Local Chaat Shop (You have been eating here since long time; like the taste; have emotional bonding; more or less convenient)
Most popular Chaat Shop of the town (Taste and ambience justify the popularity; however Chaats are exorbitantly priced and far off)
Which option would you choose? You may have guessed the
answer by now: Any of the given option depending on why you would want to eat;
who are accompanying you; how much you are willing to spend (or your pocket is
allowing you to); how much time do you have for it etc. And you would be
considering all the three explained variables while choosing any of the above
options.
You may argue that I have deliberately created an example,
which favour the EAR model explained. What about categories which are ‘bought
just like that’ i.e. impulsive purchase like say Candy. We can briefly discuss
this as well.
Here are a couple questions to you: Do you buy any candy
available in the shop? Do you have a slight bias for a particular brand,
product or flavour? Think it through and you would find that the model is still
applicable here. It is still a combination of reason & emotion with usually
an almost indiscernible sprinkle of Aspiration.
Debunking a few myths:
One of the generalizations which people normally make is to
categorize the purchase into ‘Either – Or’ bracket. For e.g. A common phrase (at least in India)
is that Apple is bought by people to Show Off which is at best a part
explanation and not the reality. There are other strong motivations too which
lead users to prefer Apple. The normally held belief that a purchase is either
Rational or Emotional seldom holds true. In most of the cases, as explained
earlier, it is usually a mix of all three. The beauty of this model is that it
explains the situation even when one factor is supremely dominant to other two.
The weightage assigned to the weak factors would tend to zero (or be actually
zero) and hence would not have any perceivable impact on the decision.
Another folly which marketers normally make is to classify ‘a
customer/ consumer’ into a fixed group/ segment of decision making – A customer/
consumer is not that simple. For e.g. saying that a consumer is a Show Off does not automatically
mean that all his purchases across categories (or even in same category) would
be guided by the trait of ‘Showing Off’. As we have seen in the examples above,
the actual decision is dependent on many considerations. This is not to
suggest that Consumer Segmentation does not work – though a significant
group does believe it. It simply means that it has to be taken in a more
nuanced way. There is much to write on whether segmentation works or not and I
may write on it in a future article.
Post Script:
A model is useless if it cannot be used for practical
implementation on ground. This article was meant for clearing some of the
doubts which usually come across while discussing Consumer Decision Making
process. While it helps us understand the problem, it is more or less silent on
‘What Next?’. In its current form, it lacks the strength of being used directly
on the ground. In my next article, I would try to tie it with the concept of Brand
and you would start seeing this model take a life of its own.
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