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MGMT6002 Influencing and Making Decisions Assignment Help
The process of decision-making is a cognitive process, which involves the selection of a certain course of action from many alternatives. Every decision is based on the decision maker's values and preferences; and the decision was taken leads to a final choice. In the process of selecting one option out of the various alternatives, the choice of the decision-maker is influenced by factors like psychological factors, social factors, cultural factors, personal beliefs and other such related ones. The taste and preference of the consumers change according to their needs and also according to the time and current trend in the market. The consumers at first, have to recognize their needs and after doing so, they should gather all the information regarding the product or service, identify various kinds of alternatives, evaluate the results and then finally decide which one they want to purchase. After taking the final decision, the consumer should evaluate whether the decision taken would satisfy the needs or not (Mullen & Johnson, 2013).
The cultural factor influences the process of decision-making the most. The cultural behavior involves set of traits, beliefs, customs and diverse ideologies. Each individual has various kind of choices, preferences, and propensity, which they develop throughout the years from his or her companions, family, status and foundation. The culture is categorized into subcultures like religion, caste, language, age, nationality and gender. All these components importantly affect the consumer. To live properly amongst the society or particular group of people, the individual would have a tendency to follow and adapt the lifestyle of social groups (Solomon, 2014).
The Howard-Sheth Model
Jagdish Sheth and John Howard presented the Howard-Sheth Model in the year 1969 as an integrated model. With the introduction of this model, the brand loyalty of the consumer buying process was also introduced. The Howard-Sheth Model can suggest three different levels of Decision making (Sheth, 2011).
At the first level, the description of the extensive problem is described, where it is assumed that the consumers have no knowledge about the brand and do not have any particular preference for any goods. So, at this level, before making any purchasing decision the consumer will gather information regarding various types of brands.
The second level of this model is the limited problem solving where it assumed that the consumers have partial knowledge about the product they wish to purchase and about the market. The consumers do a comparative analysis of brands to arrive at a particular decision.
The third level states about the habitual response behavior where the consumers have all the information regarding a particular brand and have the ability to differentiate between each product. The consumer already decides about purchasing a particular product.
The model has four major mechanisms, which are stimulus input, response output, hypothetical constructs and exogenous variables.
The first mechanism of input variables is the stimuli in the environment, which are reflected as symbolic, social and significant stimuli. The marketers use the symbolic stimuli to promote and advertise their products so that number of customers is attracted towards their product. The groups like family, friends, relatives, etc. produce the social stimuli, for example, in the case of going for a holiday, the suggestions of these groups affect the consumer and the consumer's taste and preference change accordingly. Lastly, the consumers tackle the significant stimuli to process all the elements (De Mooij, 2010).
The output variables of this model are as follows-
Attention – The purchaser's data is the establishment of the buying decision.
Comprehension – The consumer's review and thoughts of a particular brand.
Attitude – The purchaser's need and fulfillment level being met by the capability of the chosen brand.
Intention – The goal is the expectation of purchasing a specific brand.
Purchase behavior – The last step of finally purchasing reflects the purchaser's behavior to buy.
The hypothetical proposes various factors, which are in two parts. The two parts are learning and perceptual constructs. The learning constructs include the thought processes of the purchaser. The purchaser has certain purchasing design, which depends on different choices. The purchasers likewise find out about their fulfillment level as per their desires. The perceptual constructs incorporate the extent to which the buyer controls the stimulus data flow, the way the data modifies and the continuous search for the brands.
The exogenous factors are those factors that influence the purchaser externally and have effect on the purchasing process. The buyers search for products and services which good in terms of both quality and price (Tabellini, 2010)
Hence, this model states that the above mention variables reflect the learning and perception about how the consumers' satisfaction level helps them pick a particular brand and how their level of dissatisfaction make them change the preference of brand.
Limitation -In this model, there is no clear difference between the exogenous and other variables. The Howard-Sheth model is complex and it is not that easy to understand. Some of the variables are not defined properly and it if difficult to measure these variables.
The Nicosia Model
Francesco Nicosia presented the model in the year 1966 to give the explanation about the complex decision-making process of the consumers while buying a new product. This model links the relationship between the consumers and firms (organizations).
Rather than taking a conventional approach where the emphasis lay on the purchasing act, Nicosia attempted to clarify the elements required in the consumer's decision-making process. Introducing his model in the form of flowchart, he delineated the basic decision-making steps that the buyers receive take before purchasing any particular good or service. In this way, the model depicts a flow of impacts where every part goes about as an input to the following. The purchaser's decision-making process concentrates on the connection between the promoting association and its buyers; the promoting association through its advertising program influences its buyers; the buyers through their reaction to the advertiser's activity, influences the subsequent choices of the advertiser; this way the cycle continues (Quintal, Lee & Soutar, 2010).
The different parts that are further recognized into fundamental fields and subfields of the model are advertiser's correspondence influencing customer's behavior, customer's information search and its evaluation, buying activity, buying experience and input. The first field is the attitude of the consumer to the attitude of the customer, where the firm's message through advertisement reaches the consumers (Sam & Berry, 2010). The second field is related to the evaluation and search of the promoted product done by the consumer and the consumer also verifies other options. The third field relates to the actual act of purchase of the consumers. Lastly, the fourth stage is related to the utilization of the purchased product and its feedback. One field's output acts as an input to the other field. It can be explained in the following manner:
1.Communication of firm's marketing affecting the consumer's attitude- This includes the first field where the consumer is known to the message of the firms through the advertisement and promotions. The marketing can be related to the product, its price, its distribution or the attributes of the firm. The marketing process takes place through newspapers, social media, newspaper, websites, etc. All these marketing communications affects the buying decision of the consumers, their perception, and outlook towards the firm and its products. The consumer's perception also gets impacted because of the social influences, values, beliefs, experiences, etc.
2.Information gathering and evaluation process of the consumers- This includes the second field where the consumer, after formation of attitude, creates the reaction field by a continuous search of information a particular product and its alternatives. After gathering all these information, the consumer evaluates various options on the basis of benefits, attributes, features, price, etc. The consumer evaluates with the help of learning experiences and the input given the marketers. At the end of this field, the consumers develop the motive to buy the product (Kim & Trail, 2010).
3.Purchase action- The output of the second field acts an input for the third field where the consumer finally decides to purchase a product and the act of purchase from a chosen retailer takes place.
4.Post-purchase Experience and Feedback-The actual act of purchase by the consumer leads him or her to the fourth field of the model, which relates to consumption experience of the consumer and the feedback. After the consumption of a particular product, the consumer may have two types of experience. If the customer feels satisfied after utilizing the product, it would make him or her loyal towards the product and the customer would give a positive feedback towards it. Contrary to this, if customers are not satisfied with the product experience, they might not seek to purchase this product anymore in future and provide a negative feedback too (Appelt et al.2011).
Limitation-The Nicosia model has a certain limitation as this model proposes presumptions, limits, and constraints that need not be reasonable. It has been contended that the occurrence of attitude, motivation, and experience may not be in the similar sequence. The definitions of the variables are not defined in a clear manner. Internal factors to the purchaser have not been characterized and managed. The validity and mathematical testing of the model are still under question.
Comparison between the Howard-Sheth Model and the Nicosia Model
Between both the above-mentioned model, the Howard-Sheth model, adopts a modern and thorough strategy to the decision-making process of the consumer in case of purchase, by clarifying the interchange amongst factors and probable constructs that prompt a purchase decision. The quality of the model lies in the incorporation of a hypothetical expression of inputs amongst the consumer and the seller. Further, how the purchaser could process and react to such data, i.e. critical thinking and response output (Gadenne et al. 2011).
The Howard-Sheth model, in comparison to the Nicosia model, is sufficiently adaptable to consider new consumers and as well as the returning consumers and does not separate amongst business and individual clients since they show same buying behavior (Kraigher-Krainer, 2012). The model's adaptability and comprehensiveness can be connected to a range of decision-making circumstances that the rigid framework of Nicosia model cannot.
The Howard-Sheth display suffers from issues of measurement particularly about the genuine evaluation of the hypothetical construct segment. The model does not give a satisfactory limit, this construct and other factors cannot be practically determined.
The Sociological Model
As per the sociological model, the decision of the consumers is mainly dependent on both the utility and social factors like the behavior of the individuals of society, society groups and the levels of the society. The decision of purchasing is also governed by the societal restrictions. As the part of the society and other groups; the decisions, tastes, and preferences of the consumer get affected because of these groups. Family, close relatives, friends and partners have a huge impact on the purchasing choice of a buyer and also the lifestyle. The status and the location of the customer also affect the decision for purchasing anything. As this is the sociological model, the most influencing factor of the decision-making process of the consumers, is the cultural influence. Culture is nothing but a set of beliefs, ideas, rituals, values and knowledge that shapes the personality of a person (Bray, Johns & Kilburn, 2011). There are different aspects of culture like languages and symbols, enculturation, acculturation, sharing of culture, ritual and myths. Culture is progressive as it changes each day in various courses as each individual express their own particular social framework. In the decision-making process of the buyers, the advertisers should comprehend about the consistent change in the culture of the consumers while offering the products and services. This would help the sellers to sell the right product to the consumers as it matches their taste and preferences and also their cultural behavior. In this manner, the idea of utility does not decide the purchasing choices. In this model, the consumers are evaluated as a system and their behavior is assumed as the output. In addition, the stimuli are taken as the input (Ford & Richardson, 2013).
1.Input Stimulus -The input stimulus includes the cultural factors along with the social and internal factors which affect the consumer and the feedback method is linked with it. This also includes the consumer's purchasing power and other environmental factors that affect the consumer's behavior.
2.Analysis -This part consists of details about the need's insights and the product's substitute. With the common feedback system, the process of problem solving and decision-making takes place.
3.Output -The purchasing activity and non-purchasing activity, both are included in the output. The evaluation of the usage of products and its resulting behavior is done under this system (Lin, Li & You, 2012).
Limitation-In the sociological model, the identification of each department's result of the reaction is not conducted properly.Further, being a traditional model of consumer behavior it focuses only the societal factors and not the individual factors.
The Engel-Kollat-Blackwell model
The EKB model was constructed in the year 1968 as a learning model and problem-solving model of consumer behavior. The model includes specific details about the active information investigation and evaluation search of the consumers. After Nicosia model, the EKB model was formed as a revised model to adjust the former model. The model consists of the decision-making process component and the relation between them. The model recognizes that the element of the decision-making process of the consumers might not take place in the same sequence every time (Kolar & Zabkar, 2010). The reason behind this is observation is the continuous repeat purchases made by the consumers, which can bypass a few steps. The EKB model is flexible and easier to understand. The consumer behavior is taken as a process and this model has identified five activities in the process. The following are the five activities-
1.Problem recognition-It is stated that the consumers would understand the difference their current state and the ideal state. This activity might take place on the account of external stimuli.
2.Information search- At first the data gathered by the purchaser might be constant to other attitudes and values held by him or her. While being included in a data seeking, the buyer will attempt to accumulate more data from different sources. The individual gets a presentation of the stimuli, which may get his or her consideration and that can be retained or stored by the consumer in his or her memory. This technique for data is particular in nature and the purchaser will acknowledge the information, which is definitive to what is seen by them (Ho, Xu, & Dey, 2010).
3.Alternative Evaluation- At this activity, the consumer would try to evaluate the alternative options and brands. The goals, personality, and intention of the buyer would affect the methods used for evaluating the options of various products. Regarding the characteristics and benefits linked with different types of brands, the consumer seems to have certain predetermined beliefs with which he or she can move to the next activity (Martin & Morich, 2011).
4.Choice- The attitude and the intention of the consumer would majorly affect the buyer's choice. The choice would depend on the predictable circumstances and normative compliance. The normative compliance is the degree to which people like family, friends, and relatives influence the buyer.
5. Outcome-The outcome depends on the satisfaction level of the consumers. If they are satisfied, the outcome would be considered as positive and if they are dissatisfied, the outcome would be considered as negative (MacInnis & Folkes, 2010)
Except for these five activities of the EKB model, there are other variables which are related to it-
4.Internalized environmental influences
5.Motivating influences (Pookulangara & Koesler, 2011)
In today's world, every transaction of the business is dependable upon the consumers. The consumer's choices and buying pattern affect the production, marketing and selling process of the goods and services. The marketers study the behavior of the consumers very closely in order to sell their products and services rightly. The consumers are highly influenced by the environment they live in. The culture affects the activities, observation and the decision making the process of the consumers about the products and services. The buyer belongs to various cultures so every consumer has a contrasting way of consuming products. Thus, the organizations who wish to sell the products and services to the clients, who are encompassed with a differentiated gathering of individuals and who have received distinctive culture, must design a standard methodology. The methodology must be founded on the correct adjustment of interest and culture of the consumer. After the environmental factor and the satisfaction level of the consumer, another factor which influences the decision-making process of the consumers is money. A buyer may spend lavishly on purchasing if he or she has enough money and resources. All the factors are included in the above-mentioned models, which reflect how a consumer's decision making process is influenced due to various factors. Hence, a buyer's final decision of a particular product consists of several stages and is influenced by different factors.
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