Buying decision types that affects consumer behaviour

Decision making is described as the cognitive process which leads to the selection of a choice or a set of action among alternative options and influences (Wolny & Charoensuksai, 2014). In the decision-making process, a final choice is derived which may or may not lead to action. There are different types of buying decision styles which affect consumer behaviour.

Furthermore, when it comes to online purchase, consumers prior to taking a buying decision evaluate the personal, economic and social risks associated with it. Lamb (2003) and Rowley (2001), have identified four major types of buying decisions:

  • Routine response
  • Limited decision making
  • Extensive decision making
  • Impulsive buying

Routine response

The routine response is a type of buying scenario where buying behaviour does not require any critical thinking. In this decision-making type, the buyer already has extensive past experience with the product (Sharma, 2014). As a result, buyers apply this type of buying decision to products that they purchase frequently. Apart from brand recognition, quality of the product is also a crucial aspect.

For example, in the case of daily groceries, happy customers tend to return to the same vendor and take routine response without a second thought.

Furthermore, buyers also apply routine response buying behaviour to products that have less significant price tag such as groceries (Anderson et al., 2015). In case of such products, the only job of the marketer is to build brand loyalty and engage new customers by offering discounts and freebies. However the challenge for competitors is to encourage consumers to think outside the box rather than purchasing products as a habit.

Limited decision making

In this decision-making type, buyers are familiar with the product but need to obtain more information in order to ensure that it aligns with their needs (Rani, 2014). It is applicable to products that are bought occasionally, such as clothing, furniture and electronics. Furthermore, before buying such products the buyers do research and comparisons and take a moderate time in decision making.

One of the most notable examples of companies influencing customers seeking products that need limited decision-making type is clothing. E-retailers such as Shein and Myntra try to enhance consumer engagement through social media management. Furthermore, they focus on consumer-oriented activities to have reciprocal relationships with their buyers and influence their decisions. For instance, ASOS, a British e-tailer has emphasized on user-generated content strategy to develop consumer engagement through initiatives such as #AsSeenOnMe (ASOS, 2019). The retailer has also asked its followers to share their new outfits from ASOS and in exchange, the consumers are likely to be featured on ASOS Facebook and Instagram official page. Engaging customers not only helped create spread the popularity of the website on social media but also created awareness about the affordability, convenience and relatability of the website’s clothing products. After the launch of this campaign, ASOS became one of the top digital brands with high customer engagement. As a result, it saw steep rise in their sales (Martechadvisor, 2018).

Extensive decision making

Extensive decision making is described as an indulged decision-making process (Anderson et al., 2015). It is applicable with products of huge value or price tag. This includes products which are also unfamiliar in nature and less frequently bought such as real-estate and cars. These products also involve long-term commitments. Due to the nature of the products, consumers try to collect as much information as possible and re-think their decision-making criteria several times (Rowley, 2001).

This is considered as the most complex type of consumer decision-type. With products involving extensive decision making, people experience cognitive dissonance (Lamb and McDaniel, 2009). Cognitive dissonance refers to situations that involve a high degree of uncertainty in beliefs, attitudes and behaviours. It gives rise to discomfort in an individual, therefore they adjust to the change in their attitude.

Impulsive buying

Impulsive buying takes place when consumers purchase products or services without prior planning. This type of buying behaviour is highly triggered by feelings and emotions (Badgaiyan & Verma, 2014). Situations in which impulsive buying takes place include those in which the buyer is unclear about what their wants and needs. In many cases, the buyer may end up buying because of the persuasion of an in-store advertisement or display.

Impulsive buying is hard to categorize under any specific product category but mostly observed with products such as mobile phones, electronic gadgets, clothes and high-value products such as jewellery. The unplanned purchase and impulsive buying often results from irrational thinking and are often exploited by strategy makers. Environments which enable browsing, in-store displays and activities, celebrity endorsements and discounts trigger impulsive buying (Rowley, 2001).

For example, when passengers waiting for their flights at the airport go shopping for unwanted products from duty-free shops.

The table below shows a comparison of these parameters for the four types of buying decisions.

  Routine response Limited decision making Extensive decision making Impulsive
Involvement Low Low to moderate High Low
Time Short Short to moderate Long Short
Cost Low Low to moderate High Low to moderate
Information search Internal Mostly internal Internal and external External
Number of alternatives One Few Many Many

Table 1: Grid showing types of buying decision influencing consumer behaviour (Lamb, Hair and McDaniel, 2011)

References

  • Anderson, D.R. et al., 2015. An introduction to management science: quantitative approaches to decision making. 1st ed. NY: Cengage Learning ISBN-13: 978-0314024794.
  • ASOS, 2019. GET INSPIRED. [Online] Available at: https://www.asos.com/discover/as-seen-on-me/ [Accessed 28 February 2019].
  • Badgaiyan, A.J. & Verma, A.., 2014. Intrinsic factors affecting impulsive buying behaviour—Evidence from India. Journal of Retailing and consumer services, 21(4), pp.537-549, doi: 10.1016/j.jretconser.2014.04.003. 0969-6989/& 2014.
  • Lamb, C. (2003). Grademaker Sg Marketing. New Jersey: Thomson South-Western.
  • Lamb, C., Hair, J., and McDaniel, C. (2011). MKTG 4. Mason: Cengage.
  • Rani, P.., 2014. Factors influencing consumer behaviour. International journal of current research and academic review, 2(9), pp.52-61,.
  • Rowley, J. (2001). Information Marketing. Oxon: Routledge.
  • Sharma, M.K.., 2014. The impact on consumer buying behaviour: Cognitive dissonance. Global Journal of Finance and Management, 6(9), pp.833-840, doi: 10.1016/S0148.
  • Wolny, J. & Charoensuksai, N.., 2014. Mapping customer journeys in multichannel decision-making. Journal of Direct, Data and Digital Marketing Practice, 15(4), pp.317-326, doi: 10.1057/dddmp.2014.24.

Priya Chetty

Partner at Project Guru
Priya is a master in business administration with majors in marketing and finance. She is fluent with data modelling, time series analysis, various regression models, forecasting and interpretation of the data. She has assisted data scientists, corporates, scholars in the field of finance, banking, economics and marketing.
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