Digital is changing the "consumer decision making process"
Understanding the process your customers go through when trying to buy a product is essential. Known as the “consumer decision making process” and first posited by John Dewey in 1910, it explains the 5 stages that we experience when trying to buy any product or service -- chocolate, car insurance, concert tickets, you name it.
The consumer decision making process is one of the core pillars of marketing theory -- and understanding how we as consumers decide to buy something has far-reaching implications for the effectiveness of your business strategy. And there’s a caveat to that too -- in the 21st Century, there are a few factors to consider in addition to the framework.
Here is how the ol’ marketing faithful looks like:
Step 1: Problem Recognition
To walk you through the decision making process, we start with recognising a problem or need that we have to solve. Think of the last time that you purchased a phone. Did you just google “phone” and clicked “buy now” on the first result? I hope not.
See, the sales process doesn’t begin and end with the purchase itself. It’s much more than that -- we realise that we’re hungry, or perhaps the cool shirt our friend is wearing makes us want to purchase the same, or maybe we feel burnt out and need a holiday. Whatever triggers this recognition of a need can be internal (personal perceptions and feelings) or external (triggered by friend, word of mouth, marketing, etc).The takeaway here for your business is to be the first point of call for your customer’s problem. Top of mind awareness is key, which can be achieved through remarketing, a strong digital presence and consistent updates through email for example.After the customer recognises a problem that needs to be solved, they move onto how they can solve that problem.
Step 2: Information search
At this stage of the consumer decision making process, the consumer begins searching for the best solution to their problem. Similarly to the previous stage, consumers can conduct searches internally or externally. Internal search means the consumer falls back on their personal experiences whereas external search relies on anecdotes from friends and family and using search engines such as Google, YouTube and Pinterest. Keep in mind personal recommendations remain one of the most trusted sources by consumers (more trustworthy than paid ads and other marketing channels). As such, your business should consider referral marketing as a key component of your strategy as it drives word of mouth and thereby sales.
Once the consumer has collected enough information from internal and external sources they move on to:
Step 3: Alternatives Evaluation
Once the consumer has arrived at a product (hopefully, yours) in the second step of the consumer decision-making process, they confirm if it’s the right product for them. If it lacks specific attributes the consumer seeks, then they might go back to the second step and research products by alternative brands.
Essentially, the third step is about comparing different brands. Ultimately, the goal is finding a product that delivers the benefits a consumer is seeking. They might choose the best deal for them basis the price, quality, convenience, or any other factor that’s important for them.
Step 4: Purchase decision
At this stage, the consumer has analysed various products, and they buy from their most preferred brand. This stage is pretty self-explanatory; it is essentially it is the consumer clicking the “buy now” button -- however ensuring that the purchase process is as seamless as possible is essential.
Step 5: post-purchase evaluation
Once the customer has used your product, they review whether the product delivered on the promises. They will feel either satisfied or dissatisfied.
If a product exceeds the consumer expectations, then they might become your brand ambassador and spread the word about you (influencing step 2 of other potential buyers through word of mouth). The consumer might also become loyal to you and consider your other products.
If you fail to deliver on your stated product promises, then the same customer might send negative feedback. It might halt the customer journey of other prospects at step 2.
While the consumer decision making framework is logical, the process doesn’t prescribe these steps as linear - depending on the product or service consumers will spend more time on a particular stage than another. For FCMG, habitual purchases means that for your favourite chocolate bar you’ll skip stages 1-3 and jump straight into purchase. The framework isn’t supposed to be taken as gospel, however a fundamental understanding is crucial.
But wait - the customer decision making process is changing
There’s another consideration to heed: in the digital age, the way consumers make purchases are changing. There are 3 significant factors which are affecting consumer behaviour:
The enormous market penetration of mobile as well as the increasing availability and accessibility of telecommunication plans has wide implications for businesses trying to facilitate consumers down the buying process. With the greater prevalence of mobile commerce, it’s no longer about whether you should consider mobile as part of your strategy -- it’s a must have. When customers are in the information search or evaluating alternatives phase mobile-friendliness is all the more important.
Fragmentation of traditional advertising and media
In McKinsey’s article The consumer decision journey, the authors point out how fragmentation of media has changed the touchpoints between marketer and consumer:
The shift away from one-way communication—from marketers to consumers—toward a two-way conversation, marketers need a more systematic way to satisfy customer demands and manage word-of-mouth.
Businesses traditionally used “push” strategies during all touchpoints of the customer decision making process, however like the above quote suggests, billboards and promotions and other one-way communication has changed. In the digital age with increasingly oversaturated branded content it’s becoming more crucial to open up a dialogue with your consumer to engage them.
Both technology and the fragmentation of traditional advertising has culminated in empowered consumers, who are discerning and well-informed. Mobile has enabled consumers to be connected to various sources of information at any given time which they can “pull” from -- including friends and family, social media and forums. As such, the third stage of the consumer decision making framework, evaluating alternatives, has become a battleground for businesses to navigate. The proximity of messaging apps and mobile commerce is fundamentally changing how both consumers and businesses negotiate the buying process. Consequently, it’s crucial for your business to adopt a modern approach as part of your marketing strategy. Customer co-creation and embracing two-way communication is important.
The way consumers decide to buy products has evolved thanks to the ubiquitousness of mobile and the deconstruction of traditional media, resulting in informed and empowered consumers. These changes present an opportunity for your business to adopt modern, two-way strategies to ease customers down the customer decision making process.