Need Recognition, Search, Prepurchase Alternative Evaluation, Purchase

Need Recognition Depends on how much discrepancy exists between the actual state and the desired state

Need Recognition Process Desired State Actual State Degree of Discrepancy At or above Threshold Below Threshold Need Recognition No Need Recognition

Need must first be activated before it can be recognised Such factors operate by altering the person’s actual / desired states

Need activation factors Time Changed circumstances Product acquisition Product consumption Individual differences Marketing Influences

Search Motivated activation of knowledge stored in memory or acquisition of information from the environment

Search can be Internal – memory, knowledge, habit, purchase, degree of satisfaction External – when internal search is inadequate. External search could be pre-purchase search or on-going search

Dimensions of Search Degree Direction sequence

Degree of Search How many brands? How many stores? How many attributes? No. of information sources? How much time?

Direction of Search Which brands? Which stores? Which attributes? Which information sources?

Sequence of Search In what order of brands considered? In what order of stores visited? In what order of attributes considered? In what order of information sources processed?

Determinants of Search Situational Product Retail Consumer

“Age and income is often negatively related to search” Consumers engage in more search as their attitude towards shopping become more favourable “Age and income is often negatively related to search”

Prepurchase Alternative Evaluation The process by which a choice alternative gets evaluated and selected

Evaluative criteria Price Brand name Country of origin Situational influence Similarity of choice alternatives Motivation Knowledge Involvement

Decision Rules Non-compensatory methods Compensatory methods

Non-compensatory Decision Rules Lexicographic Elimination by aspects Conjunctive

Compensatory Decision Rules Simple additive Weighted additive

Some learnings Consumers typically have some determinant attributes that are salient to actually influence the evaluation process Consumers use some cut-offs on attribute values. A brand that fails to meet a cut-off may be rejected regardless of how well it performs on the other attributes Consumers make trade-offs between quality of their choice and the amount of time and effort necessary to reach a decision

Purchase Not all purchase intentions are fulfilled Reasons could be Changed motivations Changed circumstances New information Desired alternatives are no longer available

Choice of Alternative Fully planned purchase – both product and brand are chosen in advance, Extended problem solving and high involvement (61%) Partially planned purchase – intention to buy product but brand chosen at the time of purchase Unplanned purchase – both product and brand are chosen at point of sale.(50%)

Options for the source of purchase At home – travelling salesmen, internet, phone ordering, mail-order, catalogues Retail

Shopping motivations Information acquisition Alleviating loneliness Dispelling boredom Escape Fantasy fulfillment Relieving depression

Shoppers are a dwindling species Reasons Less leisure time Buying less Shopping has ceased to be a pleasure Spending less time at shops Prefer to buy from home

Enhancing Relationship Marketing Consumer value addition – quality, consistency, EDLP Personal selling- perceived knowledge and expertise, perceived trustworthiness, customer knowledge, adaptability Sales Promotion – to avoid the rigour of EPS Databased marketing – ongoing personalized contact, loyalty programmes, direct mailers