1. Consumer Decision Making & Buying

2. Objectives
Determine cultural, economic, societal, and environmental influences on consumer decision making
Determine the components of effective consumer buying

3. Importance of Consumer Decision Making and Buying
Consumer decision making affects
each consumer individually
society as a whole
Making decisions carefully is in the best interest of both
Rational analysis and careful use of the decision-making processes are essential
The processes of consumer decision making and buying plays an important role in economics!

4. Dealing with Difficult Decisions
Any decision can be simplified by taking time to:
Identify your priorities
Evaluate your options
Make your best decision

5. Values & Family Impact on the Economy
The economy of the U.S. depends on:
individual participation
decision making
Choices of consumers can combine to strongly influence the entire economic system
Factors that influence consumer choices
Values & Family

6. Influence of Values on Consumer Choices
Values influence:
what to buy
when to buy
whether to spend or save
Acknowledging the importance of values
and ensuring they are clear is important in
making effective consumer decisions

7. Influence of Values on Consumer Choices
Values are abstract, therefore goals (based on values) are often used in decision making
goals are more specific and give direction
Value = economic independence
Goal = get a job, or work toward a college degree

8. Family Influences on Consumer Choices
Stage in the family life cycle
Family circumstances
Family resources
Values of each family member 8

9. General scenario of the life cycle
The Role of the Family Life Cycle
The family life cycle greatly influences consumer decision making and buying
General scenario of the life cycle
Child/teenager
Young single
Young couple
Full nest
Empty nest
Widow (er)

10. The Role of the Family Life Cycle
Divorce and death can alter this pattern
A change in the diagram would include:
This scenario increases demand for
furniture
household items
time-saving goods and service
If a parent remarries, changes might include:
Full nest
Single parent
Full nest
Single parent
Blended family

11. The Role of the Family Life Cycle
Decision making and buying can often become a source of conflict for families
One or more family members may try to resolve the conflict by
bargaining
reasoning
“wearing down” the other party
manipulating
making your side “look good”
evoking “authority”
the one who makes the most money, etc…
making emotional displays

12. Family Influences on Consumer Choices
Values that are transmitted by the family
religion
customs
traditions
ethnic or cultural influences
Peer groups also strongly influence values, particularly during adolescence and young adulthood

13. The Role of Economics on Decision Making
Economics = a study of the processes people and societies use to make choices about making and spending their money
United States = Capitalist Economy
goals:
economic freedom
individual’s freedom to make economic choices including deciding to reject products or services, as well as choices concerning saving, investing and career paths

14. The Role of Economics on Decision Making
Economic growth is another consumer concern, including:
overall economic progress
ever-increasing standard of living
Every consumer choice is a vote in the marketplace
Consumer votes are based on values

15. Economic Efficiency Energy Ability Income Talent
For individual consumers, economic efficiency means making the best possible use of resources
Energy
Ability
Income
Talent

16. $ INCOME PAYMENTS (WAGES) $ PRODUCTIVE SERVICES (LABOR)
Cycle of American Economy
$ INCOME PAYMENTS (WAGES) $
PRODUCTIVE SERVICES (LABOR)
CIRCULAR FLOW OF THE AMERICAN ECONOMY
GOODS AND SERVICES
CONSUMERS
BUSINESSES
$ CONSUMER SPENDING $

17. Decision making is fundamental to every business AND individual!
What Influences Purchasing Decisions?
Consumers rely heavily on
Price
Value for the money
Supply and demand
when supply and demand are not at an equilibrium state, the price will be higher or lower, therefore causing a family to reconsider their purchase
Decision making is fundamental to every business AND individual! $ $ $

18. A single trigger is enough to complete the decision-making process!
Routine vs. Excitement
A balance exists in consumer buying between:
Routine decisions
consumers tendency to stick with a specific product or brand when they find one that satisfies them
Excitement of complexity
consumers enjoy finding new things
if shopping becomes monotonous, they may reject the routine and look for ways to complicate the decision by considering new brands
sometimes referred to as the ‘psychology of complication’
A single trigger is enough to complete the decision-making process!

19. The Strategy... Consumers often follow a “shopping strategy”
Practical loyalists
loyal to specific brands and products, but still look for ways to save on those particular items and brands
Bottom-line price shoppers
make purchases based almost solely on the biggest savings and cheapest items
Opportunistic switchers
choose products and brands based on sales or coupons
Deal hunters
search for the best bargains

20. Cycle of Complexity and Simplification
‘Psychology of Simplification’ -consumer seeks information and experience to help make a decision
‘Psychology of Complication’ and the ‘Psychology of Simplification’ often cycle continuously
If decision-making becomes too complicated, the consumer looks to simplify, or if process becomes too simple (dull), consumer looks to complicate

21. Influences on the Consumer
How the consumer…
thinks
feels
reasons
selects between alternatives
…affects consumer buying
Culture
Signs
Family
Media

22. Influences on the Consumer
A consumer is also often influenced by his or her culture
knowledge
beliefs
morals
customs
capabilities
habits
As culture changes continually, so do consumers’ decisions and decision-making habits

23. QUIZ
(T/F) Practical loyalists are shoppers who choose products and brands based on sales or coupons.
What are the three steps in simplifying a difficult decision?
What is consumer decision-making a result of?
ANSWERS:
B- FALSE (opportunistic switchers)
Identify priorities, evaluate options, make your best decision
Attempting to solve consumer problems

24. QUIZ
List three of the six tools family members sometimes try to use to settle buying conflicts
What are the two goals of the capitalist U.S. economy?
What do values influence?
ANSWERS:
Bargaining, Reasoning, Wearing down the other party, Manipulating,
Evoking authority, Making emotional displays
5.Economic freedom, individual’s freedom to make economic choices
6.What to buy, When to buy, Whether to spend or save

25. Production Coordinator Research & Graphic Editor
Acknowledgements
Hawkings, Del I., Roger J. Best, and Kenneth A. Coney (1998), Consumer Behavior: Building Marketing Strategy, 7th ed., Boston: McGraw Hill.
The Psychology of Consumers. Consumer Behavior and Marketing.
The Curriculum Center for Family and Consumer Sciences. Texas Tech University
Production Coordinator
Allison Mangold
Production Manager
Geoff Scott
Research & Graphic Editor
Lauren Mangold
Executive Produce
G.W. Davis
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CEV Multimedia, Ltd.