The interaction between a sales personnel and the customer is crucial in shaping the customer's perception of the store and purchase experience. A knowledgeable, helpful and trustworthy salesperson can help address customer needs and queries, facilitate the purchase process, and leave the customer satisfied with an overall positive impression of the store.

1. The Consumer Decision
Process
Sandhya Kakkar
MBA weekend
Semester 3
1

2. The Consumer Decision Process
 Also known as the EKB (Engell, Kollat and Blackwell) Model
 Seven major stages of consumption
Need Recognition
Search for Information
Pre-Purchase Evaluation of Alternatives
Purchase
Consumption
Post Consumption Evaluation
Divestment
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3. How the CDP Model is Used?
 Identify relationships between variables that affect consumer decisions
 Identify topics for additional research
 Develop and Implement Marketing Mix Strategies
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4. Factors influencing the Process:
 Individual Factors:
 Demographics & Psychographics
 Personality 
 Consumer Resources
 Motivation 
 Knowledge
 Emotions 
 Environmental Influences
 Culture, Sub-Culture and Social Class 
 Family 
 Group Influences 
 Situational Behaviours
 Psychological Influences
 Information Processing
 Perception and Learning 
 Attitude and Behaviour Change
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5. Types of Decision Process (1/2)
 Extended Problem Solving (EPS)
 The decision process is detailed and rigorous
 Time taken is extremely long
 All 7 stages of CDP are likely to be followed
 Midrange Problem Solving (MPS)
 The decision process is detailed but not so rigorous
 Time taken is fairly long
 All 7 stages of CDP may not be followed
 Limited Problem Solving (LPS)
 The decision process is quick
 Time taken is short
 All 7 stages of CDP are likely not to be followed
EPS MPS LPS
High Medium Low
Personal Involvement
Risk of Product Purchase 5

6. Types of Decision Process (2/2)
 Habitual Decision Making:
 Brand Loyalty
 High involvement with the brand
 No incentive to change until compelling evidences dictate otherwise
 Inertia
 Low involvement with product / brand
 Purchase is habitual in nature
 Change can occur with little incentive
 Impulse Purchase
 Sudden and spontaneous desire to act accompanied by urgency
 State of psychological disequilibrium
 Minimal Objective Evaluation, emotions dominate
 A lack of regard for consequences
 Variety Seeking
 Seeking change / excitement for no known cause
 Extremely brand disloyal
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7. Stage 1:
Need Recognition
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8. What is need recognition?
 Need recognition occurs when there is a discrepancy between the actual
state (consumer’s current situation) and desired state (the situation the
consumer wants to be in)
 Importance of Need Recognition
 Reveals market segment with unsatisfied desires
 Reveals barriers to success
 Provides the starting point for a new business
 Types of Need Recognition
 Generic Need Recognition:
 Occurs when the need for an entire product family is stimulated
 EG: Need to have milk or milk products
 Selective Need Recognition:
 Occurs when the need for a specific brand within a product category (selective
demand) is stimulated
 EG: Will have Amul’s Toned Milk
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9. Stage 2:
Search for Information
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10. What is Search?
 Search represents the motivated activation of knowledge stored in
memory or acquisition of information from the environment about
potential need satisfiers
 Types of Search Process:
 Internal Search:
 When memory is searched for a solution to the problem
 If internal search fails, external search is undertaken
 External Search:
 Occurs when we collect information from the marketplace
 Pre-Purchase Search
 When the external search is motivated by an upcoming purchase decision
 On-Going Search
 Information is acquired on a relatively regular basis regardless of purchase need
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11. Conducting External Search
 External Search Set:
 Those choice alternatives that a consumer gathers information during pre-
purchase search
 Apply a Funnel Search Strategy
Total Set
Retrieval Set
Awareness Set
Consideration Set
Choice Set
Decision
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12. Where we get Information?
 Personal Source
 Opinion Leaders
 Sales Personnel
 Other Shoppers
 Family & Friends
 Co-Workers & Colleagues
 Impersonal Source
 Product Labels
 Store Signage
 Point-of-Purchase Materials
 Internet Forums
 Advertising
 Catalogues
 Magazines
 Television and Radio
 Websites
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13. Stage 3:
Pre-Purchase Evaluation
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14. Evaluation of Alternatives
 From Retrieval Set, a consumer narrows down his choice by evaluating
alternatives before purchase
 Evaluation Strategies:
 Relying on pre-existing evaluation
 Occurs when consumer already have information stored in their memory
 Branding very important in developing pre-existing evaluation
 Construction of new evaluation
 Categorization Process:
 Evaluation of choice alternatives depends on particular category to which it is assigned
 Brand Extension is a strategy under the categorization process
 Piecemeal Process:
 A evaluation is derived from consideration of alternatives advantages and disadvantages
along important product dimensions
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15. Piecemeal Process
 Products are broken down into set of features
 Feature by feature comparison takes place
 The minimum acceptable feature performance is known as a “cut-off”
 Is of two types:
 Non-Compensatory Strategy
 Lexicographical Strategy
 Elimination by Aspect Strategy
 Conjunctive Strategy
 Compensatory Strategies
 Simple Additives
 Weighted Additives
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16. Lexicographical Strategy
Attribute Importance Brand A Brand B Brand C Brand D
Taste 1 5 5 4 5
Price 2 4 3 5 2
Nutrition 3 3 3 1 5
Convenience 4 2 3 3 5
1: Poor 2: Fair 3: Good 4: Very Good 5: Excellent
 Brands are compared on the most important attribute
 If one brand is perceived superior on this attribute the brand is selected
 Else the next most important attribute is taken up
 1st Comparison : On Taste { A, B, D }
 2nd Comparison : On Price {A}
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17. Elimination by Aspect Strategy
Attribute Importance Brand A Brand B Brand C Brand D
Taste 1 5 5 4 5
Price 2 4 3 5 2
Nutrition 3 3 3 1 5
Convenience 4 2 3 3 5
1: Poor 2: Fair 3: Good 4: Very Good 5: Excellent
 Brands are compared on the most important attribute
 If one brand is perceived superior on this attribute the brand is selected
 Else minimum acceptable cut-offs are imposed and the process repeated
 Suppose the minimum acceptable cutoff Taste is “Very Good” and on
Price it is “Excellent”
 1st Comparison : On Taste { A, B, C, D }
 2nd Comparison : On Price {C}
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18. Conjunctive Strategy
Attribute Importance Brand A Brand B Brand C Brand D
Taste 1 5 5 4 5
Price 2 4 3 5 2
Nutrition 3 3 3 1 5
Convenience 4 2 3 3 5
1: Poor 2: Fair 3: Good 4: Very Good 5: Excellent
 Minimum acceptable cut-offs are imposed on all attributes
 Brand failing to meet the cutoff are rejected
 Suppose the minimum acceptable cutoff on all attributes is “Good”
 1st Comparison : {B} 
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19. Simple Additive Strategy
Attribute Importance Brand A Brand B Brand C Brand D
Taste 1 5 5 4 5
Price 2 4 3 5 2
Nutrition 3 3 3 1 5
Convenience 4 2 3 3 5
1: Poor 2: Fair 3: Good 4: Very Good 5: Excellent
 Attribute ranks are added up and the brand with the highest rating
selected
 Brand A : 14
 Brand B : 14
 Brand C : 13
 Brand D : 17 
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20. Weighted Additive Strategy
Attribute Importance Brand A Brand B Brand C Brand D
Taste 1 5 5 4 5
Price 2 4 3 5 2
Nutrition 3 3 3 1 5
Convenience 4 2 3 3 5
1: Poor 2: Fair 3: Good 4: Very Good 5: Excellent
 Attribute ranks are weighted with importance added up and the brand
with the highest rating selected
 This process is similar to multi-attribute modeling
 Brand A : (1x5 + 2x4 + 3x3 + 4x2) / (1+ 2 + 3 + 4) = 3.00
 Brand B : (1x5 + 2x3 + 3x3 + 4x3) / (1+ 2 + 3 + 4) = 3.20
 Brand C : (1x4 + 2x5 + 3x1 + 4x3) / (1+ 2 + 3 + 4) = 2.90
 Brand D : (1x5 + 2x2 + 3x5 + 4x5) / (1+ 2 + 3 + 4) = 4.40 
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21. How good are we at evaluation?
 Pathetic at rational evaluation of products
 Largely we tend to equate quality with price
 Lack of knowledge is the prime culprit
 Marketers can modify “cues” / “signals” by advertising or promotions
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22. Exercise
 Groups to Present: A and B
 Have a Power-Point presentation ready (4-5 pages)
 The groups would be called to present in the class
 Evaluation will be out of 15 marks
Question A
Interview three students and identify three recent instances when
they engaged in Extended, Midrange and Limited Problem Solving.
What factors were common to decision making?
Question B
What sources of information would be used by students while making
the purchase of the following items: Laptops, Scooty or Motorcycles
and Valentine Day Cards. Are there individual differences. How can
the Valentine Day Card Manufacturer bridge these differences.
[Interview 3-5 students to get the answers] 22

23. Stage 4:
Purchase
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24. Purchase Decisions
 Whether to Buy ?
 “To buy or not to buy” – that is the question
 When to Buy ?
 Occasion of purchase
 What to Buy ?
 Product type and Brand
 Where to Buy ?
 Retail and Store Decisions
 How to Buy ?
 Payment related decisions
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25. Types of Purchase
 Fully Planned Purchase
 Both the product and the brand are chosen in advance
 Partially Planned Purchase
 Intent to buy the product exists but brand choice is deferred until shopping
 Unplanned Purchase
 Both the product and brand are chosen at the point of sale
 Mostly impulse purchase
 Need triggered by point of purchase display
 Accounts for 54% – 68% of items purchased in USA
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26. Why People Shop?
 Personal Motive
 Role Playing
 Diversion
 Self Gratification
 Learning about new trends
 Physical Activity
 Sensory Stimulation
 Social Motive
 Social Experience outside home
 Peer Group attraction
 Status and Authority
 Pleasure of Bargaining
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27. The Retail Store Choice (1/3)
 Store Image:
 The overall perception of a store
 Determinants of a Retail Success / Failure
 Location
 Perceived vs. actual time taken to reach store
 Ease of parking
 Quality and Presentation of Merchandising
 Checkout Procedures
 Nature and Depth of Assortment
 Depth, Breadth and Quality of Assortment
 Price
 Importance of price depends on the nature of buyers
 Customers may think of price as “total price” in terms of all retail activities
 Consumers react to short term change in price
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28. The Retail Store Choice (2/3)
 Determinants of a Retail Success / Failure (Contd…)
 Advertising and Promotion
 Image Advertising:
 used to form store level expectation
 Big Bazar – “isse sasta aur accha kuch nahin”
 Information Advertising
 Used to form product level expectation
 Big Bazar – Buy products Rs. 500 and 5 kg Atta free
 Sales Personnel
 The interaction point between the consumer and the company
 Perceived knowledge and expertise
 Perceived trustworthiness
 Customer Knowledge
 Adaptability
“In Service Marketing Sales Personnel Play a Key Role”
The interaction between a sales personnel and the customer is known as
sales encounter or service dramaturgy
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29. The Retail Store Choice (3/3)
 Determinants of a Retail Success / Failure (Contd…)
 Services Offered
 Self Service, Ease of Merchandise Return
 Home Delivery, Credit System etc.
 Physical store Attributes
 Color, Layout, Washrooms, Ambience, Music etc. of the store
 Also referred to as “store atmospherics”
 Creates a “gestalt” for store recognition
 Store Clientele
 What kind of people patronize the store
 POP Material:
 Old Methods still popular – pop, banner, festoons etc.
 E-Theatre, d-POP, Computer Enhanced Merchandising, Digital Self Service
 Customer Logistics
 Is the speed and ease with which customers move through retail and shopping
process
 Focuses on in-store experience of shopping and checking-out
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30. Types of Retailing
 Changing Retail Landscape:
 Location Based Retailing:
 Value Oriented Retailing
 Hyper-markets : Typically greater than 1,50,000 sq. ft.
 Category Killer : Hyper-markets with restricted product line
 Big-Box Stores : Hyper-markets selling to wholesale purchasers
 Shopping Malls
 Mom-n-Pop Stores (Kirana stores)
 Direct Marketing:
 Refers to strategies used to reach customers outside the store
 Direct Selling : face-to-face contact between sales person and customer away from a store
 Catalog Selling : Sales using mail based catalog system (Burlington)
 Tele-Marketing : Sales using telephones. Inbound Telemarketing refers to use of a toll-free
number to place orders directly
 Internet Based Marketing
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31. What People Spend in Purchase
 Money Budget
 Consumers spend money for purchase
 Time Budgets
 Consumer Spend Time during purchase
 Paid Time: is the time for you get paid i.e. office hours
 Discretionary Time: is the leisure time
 Non-Discretionary Time: is the obligated time
 Physical Obligation: spend on taking care of self needs (sleep, hair cut etc)
 Social Obligation : spend on socialization
 Moral Obligation : spend on ethical aspects
 How consumers use time is referred to as their “time-style”
 Cognitive Budgets
 Consumers are exposed to a lot of stimulus during shopping
 Can lead to limited attention span
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32. Stage 5:
Consumption
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33. What is Consumption?
 Consumption is the act of using the acquired product
 Market segmented in to 2 types on the basis of consumption:
 Non User
 User
 When is the product consumed?
 Where is the product consumed
 How is the product consumed?
 How much of the product is consumed?
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34. When does Consumption Occur?
 Refers to the time of consumption
 Consumption and Purchase need not occur simultaneously
 Consumption occurs with reference to:
 Time of the day
 I eat egg only at breakfast
 Occasion or Celebration
 Mutton is consumed every Sunday
 Season
 Mango’s are consumed during summer
 Norms
 Suit and Tie are expected dress of an executive
 Without any reason (“Compulsive Consumption”)
 Estimated 10% of product purchased is not consumed
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35. Where does Consumption Occur?
 Sales are sensitive to the place of consumption
 In-home consumption
 Out-of-home consumption
 Typically more of any product is consumed out-of-home
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36. How is the Product Consumed?
 A product can be consumed in many ways
 Straight Consumption:
 Product is consumed without any modification
 EG: Rice consumed at Dinner
 Modified Consumption:
 Product is consumed with some modification
 EG: Rice is mixed with mutton to create Biryani
 Ingredient Consumption:
 Product is consumed after using it as an ingredient in another product
 EG: Rice is crushed to make a new product Dosa
 Innovative Consumption:
 Product is consumed in an entirely new way
 EG: Washing Machines are used to make lassi at Dhabas in Punjab
Increasing Consumption is a key strategy in
Igor Ansoff’s Product-Market Strategy Matrix 36

37. How much is consumed?
 Consumption depends on various factors
 Judgment about the container in which the product is consumed
 Judgment about how much will be needed in the future
 Presentation of the product
 Sensory aspects of the product
 Markets can be segmented on how much is consumed:
 Heavy Users
 Medium Users
 Light Users
37

38. Stage 6:
Post Consumption
Evaluation
38

39. What is it?
 Post consumption evaluation (PCE) refers to the experiences, feelings
and satisfactions that a consumer feels after or during the consumption
of a product or a service
 PCE normally starts simultaneously with the consumption
 May be formed even when the product is not consumed fully
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40. Post Purchase Dissonance
 Refers to the doubts that the consumer has – regarding the correctness
of purchase – after the purchase has been made
 The intensity of dissonance is governed by:
 The degree of commitment of the decision
 The importance of decision to the consumer
 The difficulty of choosing amongst the alternatives
 The individuals normal tendency to experience anxiety
 Post Purchase Dissonance occurs because
 No product can offer everything that a consumer wants
 Consumers have to choose between alternatives
 Some trade-off is involved in purchase
 “Consumption Guilt”
 a related aspect in which the consumer feels guilty after making a purchase
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41. Consumer Satisfaction
 Refers to whether the consumption of the product meet the expectation
from the product or not:
Product Performance >> Customer Expectation : Delight
Product Performance > Customer Expectation : Pleasure
Product Performance = Customer Expectation : Satisfaction
Product Performance < Customer Expectation : Dissatisfaction
Product Performance << Customer Expectation : Divorce
 Divorce can lead to:
 Regret:
 Occurs when consumer believes that alternative course of action was a better
choice
 Rage:
 Occurs when consumer are extremely upset
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42. Why is Satisfaction Important ?
 It influences Repeat Buying
 It shapes word-of-mouth communications
 It converts satisfied user to brand promoters
 Satisfaction lowers consumers price sensitivity
 Dissatisfaction can lead to complaints and lawsuits
 It ultimately affects shareholder value
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43. Reasons for Dissatisfaction
 Core Service Failure : 44%
 Mistakes, billing errors etc that harm a consumer
 Service Encounter Failure: 34%
 Inability of service employees to deal with customers properly
 Price Failure: 30%
 High price, price increase, unfair trade practices, deceptive pricing
 Inconvenience: 21%
 Inconvenient locations, hours of operation, waiting time etc.
 Response to Service Failure: 17%
 Failure to respond, negative response etc
 Ethical Problems: 7%
 Dishonest behaviour, unsafe and unhealthy practices etc
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44. Dissatisfaction Responses
 Take No Action:
 Less favorable attitude
 Take Action:
 Complaint to store or manufacturer
 Stop Buying the brand
 Warn Friends and relatives
 Complaint to private or governmental agencies
 Initiate Legal Action
Damages caused by dissatisfaction can be controlled by:
Relationship Marketing & Consumer Loyalty Programs 44

45. Stage 7:
Divestment
45

46. Divestment
 Package Divestment:
 Store for future use
 Use for Original Purpose
 Use for New Purpose
 Throw away as garbage or litter
 Product Divestment:
 Recycle
 Throw away as garbage or litter
 Exchange or trade-in
 Sell to end user, middlemen
 Give away as gift
46

47. Exercise
 Groups to Present C and D
 Have a Power-Point presentation ready (4-5 pages)
 The group would be called to present in the class
 Evaluation will be out of 15 marks
Question C
Visit two retail stores selling the same type of merchandise and
prepare a presentation on their use of POP displays. Explain reasons
for difference if any
Question D
Design a consumer loyalty program for a restaurant of your choice.
Explain how it will help reduce dissonance and dissatisfaction
47