The Consumer Decision-Making Process

The Consumer Decision-Making Process

To understand the consumer decision-making process, we must first understand the psychology behind it. Read on to discover why consumers choose certain products over others.

Related: Management FAQs Part V

Source: Directive

Table of Contents

The Consumer Decision-Making Process

Consumers often make decisions based on emotion, rather than logic. They’re influenced by advertising, marketing, and other factors that affect their perception of a product.

The Consumer Decision-Making Process Step #1: Consumers have an emotional attachment to brands.

People tend to associate brands with emotions. This means that when people think of a brand, they automatically feel a particular emotion. If a brand makes them happy, then they’ll associate it with happiness. If a brand makes people angry, then they’ll associate that anger with the brand.

The Consumer Decision-Making Process Step #2: Consumers make decisions based on their emotions.

To understand how consumers, make decisions, let’s start by looking at what psychologists call “cognitive biases.” Cognitive biases are ways our minds work that cause us to make mistakes. These mistakes can lead to bad decisions.

The Consumer Decision-Making Process Step #3: Consumers use heuristics to make decisions.

Heuristics are shortcuts people take when trying to make quick decisions. They’re often used subconsciously, so people aren’t aware they’re using them. One common heuristic is called availability bias. It happens when people think something will be more available if they see it more frequently. For example, if you see an item advertised on TV every day, you might assume it’s more likely to be available than if you only saw it once.

The Consumer Decision-Making Process Step #4: Consumers rely on their gut instincts when making decisions.

People use heuristics to help them make decisions quickly. These shortcuts allow us to process large amounts of data efficiently. However, these shortcuts can lead to incorrect conclusions. For example, if a product has been advertised on television for years, people might assume it’s better quality than one that hasn’t been seen as much. This is known as availability bias.

The Consumer Decision-Making Process Step #5: Consumers are influenced by advertising.

Advertising influences consumers because it makes an item seem more desirable. It also makes consumers feel good about themselves. If a product is associated with a celebrity, it will likely be perceived as being high quality.

Source: Review Machine – Be An MBA

The Five Phases of the Consumer Decision-Making Process

Consumers have five phases when making decisions about products or services. Consumers are often motivated by three main factors: Desire, Expectation, and Urgency. Learn what they are and how to apply them to your business!

The Psychology of Consumer Decision Making

Consumers are motivated by three key factors when making decisions: desire, expectation, and urgency. These factors influence how consumers perceive products and services, which in turn influences their purchase behavior.

Desire: Wanting something badly enough to pay more than its worth.

Desire is one of the strongest motivators for consumer decision-making. It drives people to buy things they need and want, even though they might not need them. This is why we see so much advertising during sporting events, holidays, and other times when people are excited about an upcoming event or holiday.

Expectation: Knowing what will happen when you buy something.

People also make decisions based on expectations. They expect certain products to work better than others, and they expect those products to perform as advertised. If they don’t meet these expectations, consumers often feel disappointed and dissatisfied with the product.

Urgency: Needing to make a decision right now.

To make an informed choice, people need to understand what options are available to them. This includes understanding how different products will affect their lives. Understanding the benefits and drawbacks of each option helps consumers make more informed choices.

The Five Phases of the Consumer Decision-Making Process:

Consumers go through five distinct stages before buying anything. Learn how to identify these stages and use them to your advantage. Each phase has its own set of factors that influence whether consumers will buy something.

5 steps of the consumer decision-making process

  1. Problem recognition: Recognizes the need for a service or product
  2. Information search: Gathers information
  3. Alternatives evaluation: Weighs choices against comparable alternatives
  4. Purchase decision: Makes an actual purchase
  5. Post-purchase evaluation: Reflects on the purchase they made

Consumer Decision-Making Process Phase #1: Problem recognition

A consumer’s decision-making process begins with recognizing the need for a service or product. Recognizing a need, whether prompted internally or externally, results in a desire. Once consumers recognize a want, they need to gather information to understand how they can fulfill that want, which leads to step two.

But how can you influence consumers at this stage? Since internal stimulus comes from within and includes basic impulses like hunger or a lifestyle change, focus your sales and marketing efforts on external stimulus.

Develop a comprehensive brand campaign to build brand awareness and recognition––you want consumers to know you and trust you. Most importantly, you want them to feel like they have a problem only you can solve.

Here’s an example: Winter is just around the corner. If she’s going to survive the snow and lower temperatures, she’ll need a heavy-duty winter coat.

Consumer Decision-Making Process Phase #2: Information search

During their research, consumers also consider internal and external factors, as well as past experiences with a product or brand, both positive and negative. In the information stage, they may browse through options at a physical location or consult online resources, such as Google or customer reviews.

Your job as a brand is to give potential customers access to the information they want, with the hopes that they decide to purchase your product or service. Create a funnel and plan out the types of content that people will need. Present yourself as a trustworthy source of knowledge and information.

Another important strategy is word of mouth—since consumers trust each other more than they do businesses, make sure to include consumer-generated content, like customer reviews or video testimonials, on your website.

To find out what options are available, the customer searches “women’s winter coats” on Google. If she sees someone wearing a cute coat, she asks where they bought it and what they think of the brand.

Consumer Decision-Making Process Phase #3: Alternatives evaluation

At this point in the consumer decision-making process, prospective buyers have developed criteria for what they want in a product. Now they weigh their prospective choices against comparable alternatives.

Alternatives may present themselves in the form of lower prices, additional product benefits, product availability, or something as personal as color or style options. Your marketing material should be geared towards convincing consumers that your product is superior to other alternatives. Be ready to overcome objections—e.g., in sales calls, know your competitors so you can answer questions and compare benefits.

Example: The customer compares a few brands that she likes. She knows that she wants a brightly colored coat that will complement the rest of her wardrobe, and though she would rather spend less money, she also wants to find a coat made from sustainable materials.

Consumer Decision-Making Process Phase #4: Purchase decision

This is the moment the consumer has been waiting for: the purchase. Once they have gathered all the facts, including feedback from previous customers, consumers should arrive at a logical conclusion on the product or service to purchase.

If you’ve done your job correctly, the consumer will recognize that your product is the best option and decide to purchase it.

Example: The customer finds a pink winter coat that’s on sale for 20% off. After confirming that the brand uses sustainable materials and asking friends for their feedback, she orders the coat online.

Consumer Decision-Making Process Phase #5: Post-purchase evaluation

This part of the consumer decision-making process involves reflection from both the consumer and the seller. As a seller, you should try to gauge the following:

  1. Did the purchase meet the need the consumer identified?
  2. Is the customer happy with the purchase?
  3. How can you continue to engage with this customer?

Remember, it’s your job to ensure your customer continues to have a positive experience with your product. Post-purchase engagement could include follow-up emails, discount coupons, and newsletters to entice the customer to make an additional purchase. You want to gain life-long customers, and in an age where anyone can leave an online review, it’s more important than ever to keep customers happy.

Source: ragni


Strategic Management of Human Resources

With the right strategy, human resources management can be an effective tool for improving organizational performance. With the rise of technology, many companies have been forced to adapt their organizational structure to meet the demands of the new economy. Learn how to implement a successful HRM strategy. Read on to discover more about this topic!

The term “human resource” refers to all people in an organization, including managers, employees, and customers. It includes everything that makes up the workforce, including skills, knowledge, experience, and attitudes.

Define the Purpose of Human Resource Management.

Human resource management (HRM) is the process of managing the human capital of an organization. This includes hiring, training, motivating, rewarding, and developing employees. HRM also involves planning for future needs, such as retirement benefits, and ensuring compliance with laws and regulations.

Understand the Importance of Organizational Structure.

An effective HRM strategy requires a clear understanding of the company’s organizational structure. A well-designed organizational structure will help ensure that the company has the necessary tools to manage its workforce effectively.

Develop a Strategy for Managing Human Resources.

To develop a strategic HRM plan, first, identify the goals of the organization. Then, determine what skills and competencies are required to achieve these goals. Next, consider the current state of the organization and identify any gaps between where the organization currently stands and where it needs to go. Finally, define the roles and responsibilities of each member of the organization.

A good HRM strategy should focus on three key areas: people development, talent acquisition, and retention.

Implement a Successful HRM Plan.

Once you have determined the goals of the organization, identified the skills and competencies needed to achieve those goals, and defined the roles and responsibilities of the members of the organization, you can begin implementing a successful HRM strategy by making sure that the organization has the necessary tools to succeed.

Inventor Help

Do you have an invention idea but aren’t sure who to turn to for help? We’ve got some tips on finding the right investor for your idea.

How to Find the Right Inventor for Your Invention?

Do you have an invention idea but aren’t sure who to turn to for help? We’ve got some tips on finding the right investor for your idea.

What Does an Inventor Do?

An inventor creates a product or process by combining existing technologies into a new one. They also develop the technology needed to make the invention work.

Why Do People Need Help with Their Invention?

If you’re looking for help with your invention, there are several reasons why people need inventors.

  1. First, not everyone has the skill set to design or build a product.
  2. Second, even if you do have those skills, you might not have the money to hire someone else to do it for you.
  3. Third, you might not have access to the materials you need to complete the project.
  4. Finally, you might just not have enough time to devote to the project.
Start by looking at patent databases like USPTO’s website.

You’ll find patents listed under “Invention Search” on the USPTO website. This search will give you a list of patents filed within the last few years that cover similar inventions. Then, you can narrow down your search using criteria such as the type of material used (e.g., plastic), the method of manufacture (e.g., injection molding), or the intended use (e.g., toys).

Check out online communities where inventors share their ideas.

There are several online communities where inventors can share their ideas. These sites often provide forums where people can ask questions about how to make their inventions work better or what materials would be best suited for certain applications. They also offer advice on patenting and licensing.

Ask friends or family members about their experiences with inventors.

You might find that one of your friends has had success with an inventor. Or maybe you know someone who’s been through the process of getting an invention patented. If so, ask them for recommendations.

Accounting Definition

Accounting is the process of recording financial transactions and analyzing them to determine whether they comply with accounting standards. The term “accounting” comes from the Latin word for bookkeeping. It refers to the process of keeping track of money in an organization.

The purpose of accounting is to provide information about an organization’s financial activities.

In addition to providing information about an organization’s finances, accounting also provides information about how well the organization is doing. This helps managers make decisions about what actions to take to improve the company’s performance.

An accountant prepares financial statements by using accounting methods.

Accountants prepare financial statements by using accounting principles. They use these principles to record financial transactions and analyze them to determine whether they conform to generally accepted accounting principles (GAAP). GAAP are rules set forth by the Financial Accounting Standards Board (FASB) that govern how companies must report their financial results.

A company must have a set of accounting principles to use when preparing its financial statements.

Companies must follow certain accounting principles when preparing their financial statements. These principles are known as Generally Accepted Accounting Principles (GAAP), and they apply to every business regardless of size.

Financial statements include balance sheets, income statements, cash flow statements, and statements of changes in equity.

GAAP are rules set by the Financial Accounting Standards Board (FASB). They are designed to ensure that companies provide accurate and reliable financial reports.

The primary objective of financial reporting is to enable users to make informed decisions regarding investments.

In addition to providing an overview of the company’s finances, financial statements also show how well managers are doing at managing the business. This includes measuring performance against targets, evaluating the effectiveness of strategies, and identifying areas where improvements can be made.

Organized Culture

In today’s world, businesses have to be organized if they want to succeed. Learn why and how to organize your business effectively!

Organized Culture Is the Key to Successful Businesses:

In today’s world, businesses have to be organized if they want to succeed. Learn why and how to organize your business effectively!

The first step in organizing anything is deciding on a goal. Once you’ve decided on that goal, you need to figure out how to achieve it. This includes setting goals for yourself, your team, and your company.

The Importance of Organization.

If you’re looking to improve your organization skills, start by thinking about what you’d like to accomplish. What do you want to learn? How will you measure success? Then set up a plan to reach those goals. You’ll also need to decide who’s going to help you with the process. It might be helpful to enlist the support of an expert.

Why You Need an Effective Organization Plan.

An effective organizational plan helps you stay focused on the big picture while managing day-to-day tasks. It also helps you avoid getting distracted by small details.

How to Create an Effective Organization Plan?

A good organization plan will help you manage your time efficiently, keep track of projects, and ensure that everything gets done on time. Here are some tips to help you develop an effective organizational plan:

1. Set up a weekly schedule. This should include what needs to be accomplished each week, when it needs to be completed, and who is responsible for completing it.

2. Make sure you stick to the schedule. If you miss a deadline, make sure you communicate with the people affected as soon as practicable so they understand what happened and why.

3. Keep things simple. Don’t try to do too much at once. Instead, focus on one task at a time and complete it before moving on to the next thing.

The Importance of Structure

An effective organizational structure helps you stay focused and productive. It also ensures that everyone knows what to do and when to do it.


A good organizational structure will help you manage your time efficiently and keep you focused on the right tasks at the right times. This means that you won’t waste time doing things that aren’t necessary. You’ll also avoid getting distracted by unnecessary tasks.

Source: MIT OpenCourseWare

Meaning of Entrepreneurship

In today’s world, entrepreneurship has become an integral part of our lives. It is not just about starting up a business but also about making a difference in society. Read on to discover more about entrepreneurship.

Entrepreneurship is the act of creating new businesses or products that solve problems for people. The entrepreneur takes risks by investing his/her money and time into something that might fail.

The Definition of Entrepreneurship.

According to Wikipedia, “Entrepreneurship is the process of initiating, developing, establishing, and managing a new venture or expanding an existing one. An entrepreneur is a person who creates and manages a new enterprise or commercial endeavor.”

What Are Some of the Benefits of Being an Entrepreneur?

There are many benefits associated with being an entrepreneur. One of them is that entrepreneurs can make a positive impact on society by creating jobs and contributing to the economy. Another benefit is that entrepreneurs can build something that will last for generations.

What Are Some of the Challenges Faced by Entrepreneurs?

A common challenge faced by entrepreneurs is finding funding for their ideas. This is because there are so many other people who would love to start a business but do not have the funds needed to do so. However, there are ways to overcome this problem. One option is to seek out investors who are willing to invest money into your idea. Another option is to use crowdfunding platforms such as Kickstarter and Indiegogo. These platforms allow individuals to raise money through donations from others.

Why Do We Need Entrepreneurs?

Entrepreneurship is one of the most powerful forces driving innovation and progress in modern times. They are responsible for creating new businesses, products, services, and jobs. They are also responsible for improving existing ones. Entrepreneurs are the innovators of tomorrow.

Example for Non-Verbal Communication

Non-verbal communication examples will help you understand the concept better.

Non-verbal communication is an important aspect of human interaction. It helps us express our feelings and emotions. In this article, we have listed some non-verbal communication examples that can help you understand the concept more clearly.

The way people communicate verbally and non-verbally has changed over time. This change in communication styles has led to new forms of social interactions.

Facial Expressions Examples

  1. A smile shows happiness and friendliness. If you see someone smiling, you feel happy too. Smiling also makes people feel good about themselves.
  2. A frown means anger, sadness, or disappointment. You might not want to make others angry by smiling at them when they are angry.
  3. Eye contact is another form of non-verbal communication. Eye contact is used to show interest and attention.
  4. Facial expressions are used to communicate emotions such as surprise, fear, disgust, and contempt.

Gestures Examples

Hand gestures are one of the easiest ways to convey meaning without speaking. They are quick and easy to perform. Hand gestures can be used to show agreement, disagreement, or indifference.

  1. For example, if you agree with something, you can raise your hand.
  2. If you disagree, you can put your hands down.
  3. If you are indifferent, you can keep your hands down.

Eye Contact Examples

Another form of non-verbal communication is eye contact. This is when two people look at each other while talking.

Eye contact can be used to communicate interest, curiosity, or even boredom. It can also be used to send messages between two people.

  1. For example, you might use eye contact to tell someone you are interested in what they are saying.
  2. You might also use eye contact to let them know you are bored by what they are saying. You could also use eye contact to ask them a question.

Hand Gestures Examples

Various hand gestures can be used to convey different meanings. Here are some examples of these gestures.

  1. Hand gesture #1: A fist with the thumb extended means “I am angry”.
  2. Hand gesture #2: A clenched fist with the palm facing down means “I am upset”.
  3. Hand Gesture #3: An open palm facing up means “I am happy”.

McGregor’s X and Y Theories

In this section of the article, we explain what McGregor’s X and y theory is and why it matters.

McGregor’s X & Y Theory is an important concept in psychology that helps us understand how our thoughts affect our behavior. It was developed by psychologist Dr. Robert B. M. McGregor in the 1950s.

Why does the X and Y Theory Matter?

The X and Y Theory explains how people behave based on their beliefs and attitudes. This includes everything from how we think about ourselves to how we act toward others.

What is the X and Y Theory?

The X and Y theory was developed by psychologist George A. Miller in 1956. He believed that two main factors determine human behavior. These factors are called “X” and “Y.”

What is the Difference Between the X and Y Theory and the Pareto Principle?

According to the X and Y theory, people tend to behave in one of three ways:

  1. They are either very conscientious (X) or not at all conscientious (Y).
  2. They are either extremely intelligent (X) or not very intelligent (Y).
  3. People fall into one of these categories more often than any other combination.

The Pareto principle states that 80% of the effects come from 20% of the causes. This means that 80% of the results come from only 20% of the effort.

When Should You Apply the X and Y Theory to Your Business?

The X and Y theory applies to business as well as personal life. It helps us understand how our actions affect others. If we want to make an impact on others, we need to focus on those who are most likely to respond positively to our efforts.

How Can You Apply the X and y Theory to Your Business?

The X and Y Theory explains how people react to different situations. We use the X and Y axis to represent two opposing forces. The X-axis represents the positive side of the spectrum, while the Y-axis represents the negative side.

Skills of A Manager

What skills do managers need to be successful? In this article, we’ll share five key skills that every manager should have.

5 Key Skills to Have as A Manager:

Managers must possess these five essential skills to succeed at their jobs. These include leadership, communication, decision-making, problem-solving, and teamwork.

Be able to communicate effectively with employees.

Communication is one of the most important skills for any manager to master. It’s also one of the most difficult. Effective communication requires an understanding of how people think and feel. This means being able to listen carefully and respond appropriately.

Understand how to motivate people.

Motivating others isn’t easy. You can’t just tell them what to do; you must first understand why they’re doing something. Once you’ve identified the reason behind their behavior, you can then help them find ways to achieve their goals.

Know how to lead by example.

Managers who are good at motivating people often demonstrate their leadership through their actions. They set an example for others to follow. If you want to motivate employees, make sure you’re setting a positive example yourself.

Be able to manage conflict.

Conflict is inevitable in any workplace, but it’s especially common when there are multiple stakeholders involved. It’s important to learn how to deal with conflict effectively so that everyone wins.

Be able to build relationships.

Managers must be able to build strong relationships with employees, customers, and other stakeholders. This means being able to listen well, communicate clearly, and empathize with others.

Concept of Management/ Management Concept

Today management has become an important aspect of our lives. It is not only about managing people but also about managing resources. That is why it is essential to understand the concept of management. Read on to discover more about the concept of management.

The Concept of Management:

Today management has become an important aspect of our lives. It is not only about managing people but also about managing resources. That is why it is essential to understand the concept of management. Read on to discover more about the concept of management.

What Is Management?

The term “management” refers to the process of planning, organizing, directing, coordinating, controlling, and evaluating human and material resources to achieve organizational goals.

Management is a set of activities that help organizations to plan, organize, direct, coordinate, control, and evaluate human and material resources in such a way as to meet organizational objectives.

Types of Management

There are two main types of management – strategic management and operational management. Strategic management involves planning, organizing, directing, coordinating, controlling, and evaluating the organization’s activities to achieve its goals. On the other hand, operational management deals with the day-to-day operations of the business.

Functions of Management

To manage effectively, one must first understand what management is. A manager is responsible for making decisions regarding how to allocate resources within an organization. He/she makes sure that these resources are used efficiently and effectively.

Importance of Management

Managers are responsible for ensuring that employees work together as a team. They ensure that there is no conflict between them and that everyone works towards achieving common goals.


A manager should be able to motivate his/her subordinates by providing clear objectives and setting expectations. He/she should also provide feedback to help them improve their performance.

Strategic Plan Process/ Strategic Planning Process

A strategic plan is an essential tool for small businesses looking to grow their business. Learn about the process of creating one here!

The Strategic Planning Process for Small Businesses:

The first step in any business strategy is to define its purpose. This includes defining the problem that needs solving, identifying the market opportunity, and determining how the company will achieve success.

Define Your Goals.

Once you have defined your goals, you need to determine what steps you need to take to reach them. This is known as the strategic planning process. It involves developing a vision statement, mission statement, and objectives. You also need to identify the key performance indicators (KPIs) that will help measure progress towards achieving your goals.

Identify Your Strengths & Weaknesses.

One of the first things you should do when starting with any new project is to identify your strengths and weaknesses. If you are not sure where to start, consider asking yourself these questions: What am I good at? What am I bad at? What would my ideal client/customer say about me? And, what would make me happy? These questions will help you define your strengths and weaknesses and give you insight into how to improve your skills.

Develop Strategies to Address Them.

Once you have identified your strengths and weaknesses, you need to develop strategies to address them. This means identifying what you are doing well now and what you would like to do better. You also need to think about what you would like to avoid doing in the future.

Create an Action Plan.

To begin, you should identify your goals. These might include increasing sales, improving customer service, or expanding your brand. Then, you will need to determine how you will achieve these goals. What actions will you take? How will you measure success?

Implement Your Plan.

Once you have determined what you want to accomplish, you must develop a strategy to help you reach those goals. This involves planning out each step of your plan. You should also consider the resources available to you. Do you have enough money to hire additional staff? Will you need to invest in new equipment?

Marketing Societal/ Societal marketing

Societal responsibility of marketing is a marketing concept that holds that a company should make marketing decisions not only by considering consumers’ wants, and the company’s requirements, but also society’s long-term interests. (Source: Wikipedia)

Performance Evaluation

Performance evaluation is an important part of any job. It helps managers understand how well employees perform in different areas of their jobs.

What performance evaluation is?

Performance evaluation is an ongoing process that helps companies understand whether their solutions are effective. It involves gathering data about the effectiveness of a solution and using that data to make decisions about future actions.

Define the problem.

To evaluate employee performance, managers must first define what success looks like. This means defining the goals of the position and setting expectations for the employee. Managers should also set clear standards for measuring progress toward those goals. Finally, managers need to establish a system for evaluating performance.

Identify the solution.

Once you’ve defined the problem, you can start thinking about solutions. You might consider asking yourself questions such as “What would I do differently?” or “How can I improve my skills?” These questions will help you identify potential solutions.

Evaluate the results.

After you’ve identified a solution, you need to evaluate its effectiveness. This means looking at how well the solution worked and whether it was successful. If you’re not sure what to measure, ask yourself these questions: How did the solution affect the outcome? Did the solution work as expected? Was there any unexpected side effect?

Measure the impact.

To determine the success of a solution, you should measure the impact it had on the outcome. You might consider measuring the following:

  1. Number of people who were affected by the solution
  2. Amount of money spent on the solution
  3. Time required to implement the solution

Also Read: Agile Transformation: How to Transform Your Business into an Agile Organization

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