Consumer Behaviour: Decision Making For Weekly Shopping List

Analysis of Consumer Profile

Question:

Discuss about the Analysis Of The Decision Making Of Consumer.

Consumers are rational beings and generally take a wide variety of decisions in order to purchase a particular product. However, this is not the case for all kinds of products and the consumers generally imply a tougher decision making criteria when they are considering the product purchase of a higher involvement.

The given report aims to throws light on one such consumer behaviour and the decisions made based on the weekly shopping list of the consumer. The purchases made are for the week 30^th March to 5^th April 2018. The report will provide a brief analysis of the consumer profile which is then followed by the decision making faced by the consumer with respect to the weekly shopping list (Armstrong et al., 2015). The decisions will be analyzed and categorized and compared with the ones with high involvement. The primary purpose of the report is to highlight how consumers tend to make decisions for the purchase and what factors they are guided by.

The given section will be providing a brief on the consumer and I will be following a systematic structure to describe myself before I begin to analyze the shopping which was done.

Demographics:

Age	22
Gender	Female
Marital Status	Single
Family	Nuclear Family with 4 members
Education Level	Graduate
Income	$2000 per annum
Occupation	Part time free lancer
Generational Cohort	Generation Y as date of birth IS 1995.
Value Segment	Using the Roy Morgan`s Value Segments, I believe that I belong to the category of `Young Optimism`. This category of individuals is driven by optimism and they seek to improve their prospective so that they are able to seek a respectable place in the society. This aspect is most likely to be found among the younger generation. The given segments are mostly into image and style. The given segment is extremely conscious about their image and they aim to project themselves as the righteous one They are long term thinkers and they aim to plan their careers and jump to various aspects in order to ensure that they are able to experience all realms of life which include travelling, building a career, enjoying with friends and family. They are the experimental generation who want to try everything from bungy jumping to skiing to trying new flavors, styles and tastes (Young Optimism, 2018).  They are highly interested in technology and surf the internet to make most of their purchasing decisions.

 
Therefore, from the given analysis it can be observed that the given consumer segment is very experimental in nature. They want to experience new styles and tasted. They are the primary target segments of the marketers as they tend to purchase almost everything and in adequate quantities. The given segment is largely attracted by the digital marketing techniques and organizations can target them suing these techniques.

Even for a very simple purchase being made, the consumers put behind a wide range of thought processes which tend to have an impact on the decision making process of the different purchases. Many buyers buy certain products at the spur of the moment based on the emotional aspect of the product. The decision made by the consumer may also be well thought and well defined. According to Weinstein and Pohlman (2015), the given processes are generally present for the decision making:

Nominal         

The normal decisions are generally made keeping in mind the low cost products. These decisions are generally based on frequent purchases, familiar brand or a produce and the purchase requires almost little or nor effort. These decisions are generally made with respect to products like brand of milk, detergent, spices, oils and others (Baker &Saren, 2016).  For instance, if a consumer has to purchase a laundry powder or suppose a dish wash bar then they will not be spending much time researching on the brand and instead they will be just purchasing it without any second thought. However, the normal decision making process is not casual during its initial phases and at the beginning of the phase, the consumer may have faced research and queries while making a decision. In case of a laundry detergent powder, the consumer may have searched upon aspects like smell, soft aspect and others. After the given procedure, when the product which has to be purchased becomes repeated, the consumer loyalty towards a particular brand tends to increase and the decision becomes nominal.

Decision-Making Process for Weekly Shopping List

However, it needs to be noted that, the organizations need to not put too much effort behind the marketing of the product because that would lead to a negative impact on the minds of the consumers and as the customers purchase the product on a general impulse, they need not be continuously reminded about the given product (Bresler &Lubbe, 2014). Marketers just need to ensure that the product to be purchased is available and the right pricing structure is followed for it.

Application to the Shopping List:

It can be stated that the given products from the shopping list fall under the given category:

• The apples from Coles $ 20.5
• The bananas purchased from Coles $10.5
• The Colgate toothpaste $40
• Rice from Nepalese grocery $ 20
• Petrol from Caltex $100
• Phone bill from Vodafone $400

Limited

The limited decision making involves higher involvement than that of nominal decision making. However it does not necessarily involve in depth research. These decisions are generally made for the mid cost products. These purchases are not made that regularly and the brand from where it is purchased is familiar. However, they do require involvement and searching from the point of view of the consumers.

When customers are bound to make the limited decisions then they consider the cost as well as time aspect to ponder over there purchase but might not take online sites as reviews (Stead &Stead, 2013). The just tend to rely on their memory of the product and make decisions based on the inferences.

For example, if a customer wants to purchase a given brand of juice and visits the store but instead observes that another juice has some offer and that although it is a bit expensive but it does taste well, then the customer might go on with the alternate juice. It can be stated that the limited decisions which are made do lack loyalty and the reason behind this may be boredom or choice of using a new product.

The marketers will be required to examine the data before they are advertising their products and the data is to be examined based on the following:

• Product quality
• Product availability
• Price
• Packaging style

After the given has been analyzed, the brands can then set their promotional activities.

After carefully examining this information, brands can change their promotional activities and product development that will accentuate the benefits of the product, and make it less likely that people will choose something else.

Application to shopping list

• Donuts from the Coles $50
• Meals from hungry jacks$ 40
• Wai Wai noodles $30
• Pizza$ 100
• Water bill $ 100
• Beer $70
• Aloevera $20
• Meat $60
• Coffee $ 80
• Meals from charcoal $90

The extended decision making is generally made with respect to the high cost and higher quality products. These purchases which are made are generally infrequent in nature and indulge involvement of decisions and center on unfamiliar brands and products. The customer is generally required to put behind time and effort to ensure that the decision which has been made is correct and right for them.

The particular kind of decision making is generally done for the customers who tend to purchase the electronics like televisions, cars and mobile phones (Burns, Bush &Sinha, 2014). They indulge in time and effort engagement because the marketers want to ensure that the decision which is taken by them is based on their requirements and are correct for them. Customers generally have certain amount of risks during this decision making and therefore the time frame for the particular decision is quite high. Peer views are a large determinant of the purchasing decisions of this type. It is in this case, that the customers tend to take reviews and testimonials.

Comparison with High-Involvement Purchases

The extended decision making product purchased Toyota Yaris Car which is priced at an average of $18000.

Hence, from the given observed purchase behaviour of the customer and the data collected, it could be observed that the customer has spent the largest amount of money on the phone bill. The customer has made a purchase of around $400 on the given bill.  This is a need as the consumer is away from his home and needs to contact the different associates. Secondly, the next highest purchase is made on Petrol of $100. It can be observed that the consumer has made nominal purchases on food items and midlevel purchases of the other need like phone and petrol

The high involvement purchase made by the customer has not been considered in the given section. It was observed that the majority of the purchased made by the consumer are based on food items amounting to $550 dollars which is 50% of the total amount spent on grocery.

The nominated product with high involvement is the product named Toyota Yaris.  The Toyota Yaris is a subcompact car which is produced by Toyota since the year 1999 and the given model replaced the startlet model.

The given car is purchased for the purpose of travelling. The given product was purchase by me one year back and the color of the car was Red. The given product was purchased after varied amount of decision making and references from peer groups and families.

The decision making followed for the given product is as follows:

Figure1: The decision making process of the consumer (Source: Trainor et al., 2013)

In the first stage, the need was analyzed. From a long period of time the consumer had been planning to purchase a product which would then help in her travelling needs from one place to another (Sheth &Sisodia, 2015).   When the need was arised, it was identified that the given product would be the best one to be purchased.

Information research

The second stage involved researching the information on the varied sources available on the net so as to identify the competitors of the product and to identify whether the qualities of the other cars and their prices were similar to the given product or not.

Evaluation of Alternatives

A decision making chart was formed which involved evaluation of different alternatives.  These alternatives were judged on the basis of various components like quality of the car, mileage, price additional features and others (Keller &Kotler, 2016). 

Purchase

After the data had been analyzed, the final purchase is then made. The final purchase which is made is on the basis of analyzing various alternatives.

Post purchase decisions

After the purchase has actually been made, the consumers then consider their choices again and sometimes regret the decision which they undertake.

The given product of Toyota Yaris was a high involvement product. The given product was based on the extended decision making. As stated earlier, the extended decision making tends to involve, a large amount of alternatives evaluation and research. The kind of decision making generally involves decisions based on varied alternatives like price, quality and other metrics. The customers are generally willing to take risks for these kinds of products.

Size	Large
Colour	Red
Price	18000$

Factors Guiding Purchase Decisions

The comparison between the two different decision making matrices is as follows:

First of all, the products that were included in the shopping list and related to grocery primarily involved Nominal and Limited Decision Making. However, the purchase of the high involvement product involved extended decision making.

Secondly, for the shopping list items based on grocery items, the peer pressure and social circle impact is very less and the decision making generally involves taking decisions from daily usage (Khodakarami &Chan, 2014). Whereas for the car purchased, the decision making was impacted by the different social group impacts.

Thirdly, the risk of purchase in the grocery items is very less when compared to the purchase of the items which is made in case of the purchase of a high involvement product from the given market.

Next,  for the grocery products whereby the decision making is based on nominal or limited, the customers generally do not indulge in comparison or testimonials and their approach is very crucial. The purchase of the Wai Wai or petrol or for that matter the Pringles chips was base on Nominal or Limited Research and decision making unlike the purchase of the car. The Toyota Yaris involved extended decision making as it was a high involvement product. The high involvement products generally involve high reference to testimonials and their related documents.

Lastly, in case of the purchase of the grocery items, costs do not play a huge role as a determinant of the purchase of a product. There are various brands present in the market and a purchase from one with a slightly higher price does not have an impact on the other. However, when the purchase regarding the high involvement luxurious good like a Car is made, the price plays a huge role.

The key insights of the decision making which was done using the shopping list and plotting them on different bar graphs are as follows:

The consumers are driven by quality. A majority of the decision making is done with respect to the quality required by the customers. Hence, the decision makers can learn that the decision making is generally based on quality and if the marketers are able to provide quality to the customers then they will be able to succeed. According to the bar graph attached, around 50% of purchases are determined by quality.

Tastes tend to determine 5% of the purchases in case of food products and choice. This is the reason it is very important for a firm to concentrate on the taste. Purchase is determined by the background of the customer, if the customer is from a well to do background then price does not matter. Quality is the key. It was also observed that once the consumers have formed a particular notion about the purchase of a particular product, it is difficult to change that perspective about the given product and re-branding does not help.

A majority of purchases made on the list are based on self actualization needs and esteem needs. This is a typical characteristic of the Young Optimists which was the segment of the given consumers.  Social pressure is also a major determinant of the decision to be made.

Limited Decision Making

Table 1: Count of Major Purchasing Factors

Row Labels	Sum of Cost
Change/alternative	25.9
Convenience	137.35
Health	363
Price	6
Quality	718.9
Taste	54.65
Grand Total	1305.8

Table 2: Count of Motivational Needs

Row Labels	Sum of Cost
Esteem	57.3
Psychological	355
Safety	30
Self Actualisation	93.7
Social	769.8
Grand Total	1305.8

 
Therefore, from the given analysis it can be stated that the consumer is truly the key component of the decision making which is made by the firms. The firms need to ensure that all their moves are directed towards the decisions of the consumers. Their psychology behind it and the demand which is placed by them matters. If the firm is successful in taking such decisions then they will be quite successful in the given market.

The decision making process, as discussed may be of various kinds namely limited Nominal and the extended. The decision type that we generally make on a daily basis is the decision making related to the nominal decisions. These decisions are made on the spur of the moment without much thought. The mid level products are generally made with reference to the limited research where consumers are bound to make decisions which will involve certain research. Lastly the extended decision making is suitable for the high involvement luxurious products as they comprise of risk factors.

The given report highlighted the profile of the consumer followed by the analysis of the decision making behind the shopping list. This was followed by an analysis of the decision making related to the high involvement product and the purchase of the Toyota car. A comparison between the two had been made along with Key Insights on the purchases.

References:

Armstrong, G., Kotler, P., Harker, M. & Brennan, R. (2015). Marketing: an introduction. Pearson Education.

Baker, M.J. &Saren, M. eds. (2016). Marketing theory: a student text. Sage.

Bresler, M. &Lubbe, I. (2014). Marketing management.

Burns, A.C., Bush, R.F. &Sinha, N. (2014). Marketing research (Vol. 7). Boston, MA, USA: Pearson.

Keller, K.L. &Kotler, P. (2016). Marketing management. Pearson.

Khodakarami, F. &Chan, Y.E. (2014). Exploring the role of customer relationship management (CRM) systems in customer knowledge creation. Information & Management, 51(1), pp.27-42.

Sheth, J.N. &Sisodia, R.S. (2015). Does marketing need reform?: Fresh perspectives on the future. Routledge.

Stead, J.G. &Stead, W.E. (2013). Sustainable strategic management. ME Sharpe.

Trainor, K.J., Andzulis, J.M., Rapp, A. &Agnihotri, R. (2014). Social media technology usage &customer relationship performance: A capabilities-based examination of social CRM. Journal of Business Research, 67(6), pp.1201-1208.

Weinstein, A. &Pohlman, R.A. (2015). Customer value: a new paradigm for marketing management. In Proceedings of the 1997 Academy of Marketing Science (AMS) Annual Conference (pp. 132-133). Springer, Cham.

Young Optimism. (2018). Roy Morgan. Retrieved 18 April 2018, from https://www.roymorgan.com/products/values-segments/young-optimism

Chernev, A. (2018). Strategic marketing management. Cerebellum Press.

Choudhury, M.M. &Harrigan, P. (2014). CRM to social CRM: the integration of new technologies into customer relationship management. Journal of Strategic Marketing, 22(2), pp.149-176.

Coombes, P.H. &Nicholson, J.D. (2013). Business models &their relationship with marketing: A systematic literature review. Industrial Marketing Management, 42(5), pp.656-664.

Foxall, G. (2014). Strategic Marketing Management (RLE Marketing) (Vol. 3). Routledge.

Goetsch, D.L. &Davis, S.B. (2014). Quality management for organizational excellence. Upper Saddle River, NJ: pearson.

Gronroos, C. (2016). Service Management &Marketing: Managing the Service Profit Logic. John Wiley & Sons.

Hollensen, S. (2015). Marketing management: A relationship approach. Pearson Education Limited.

Solomon, M. R., Dahl, D. W., White, K., Zaichkowsky, J. L., & Polegato, R. (2014). Consumer behavior: Buying, having, &being (Vol. 10). Pearson.

Cantallops, A. S., & Salvi, F. (2014). New consumer behavior: A review of research on eWOM &hotels. International Journal of Hospitality Management, 36, 41-51.

Li, S., Linn, J., & Muehlegger, E. (2014). Gasoline taxes &consumer behavior. American Economic Journal: Economic Policy, 6(4), 302-42.

Zhao, H. H., Gao, Q., Wu, Y. P., Wang, Y., & Zhu, X. D. (2014). What affects green consumer behavior in China? A case study from Qingdao. Journal of Cleaner Production, 63, 143-151.

Hawkins, D. I., Mothersbaugh, D. L., & Best, R. J. (2013). Consumer behavior: Building marketing strategy. McGraw-Hill Irwin.40.00