The Psychology of Consumer Decision Making

The Psychology of Consumer Decision Making

Understanding consumer psychology informs successful business because it allows companies to better align their marketing and selling activities with what consumers want and are willing to part with their money for. Here are five important steps consumers go through while they decide what to purchase. We will examine each of these five steps: problem recognition, information search, alternative evaluations, purchase decision, and post purchase evaluation.

People’s individual means and lifestyles have a large bearing on their buying choices – a factor that allows companies to target their advertising efforts more precisely and make the customer experience smoother.

Need Recognition

This is typically when the consumer becomes aware of their need to purchase certain products (even if the person’s actual awareness of ‘needing’ a purchase resulted from a previous worrying experience or purchase or testimony from another source).

Once the need is identified, the customer is likely to begin seeking product information in order to evaluate alternatives. Each individual’s search process will depend on his or her existing knowledge of the product or category, and how long the person is willing to spend searching, among other factors.

This considered four input factors (PU, PEU, PT and PQ) and six process factors (IS, EA, IR, PBRCRP) in a model that has shown usefulness in researching the decisions of online purchases.

Information Gathering

It’s not hard to see how consumer decision-making might be influenced by a wide range of factors, from personal values and past experiences to social pressures and marketing spins, biases in thinking or behaviour. People might be manipulated with subtle marketing strategies; a better grip on human behaviour can help businesses create marketing strategies that talk to customers and increase satisfaction.

Information collection is related to the procedure by which consumer gathers information on subject matter through search, findings, interview, observation and experiment.

Although consumers gather more purchase-related information, research in the Harvard Business Review showed that decision simplicity is the most impactful consideration on the consumer purchase decision.

Decision Making

Consumer decision-making follows a sequential process that starts with need recognition, passing through a search stage for alternatives, and eventually selecting the right alternative from among the viable ones. The process can be based on logic or intuition; yet, the selection of an alternative can imply recourse to explicitly known parameters as well as other, frequently unexpressed elements we call tacit, such as beliefs.

At this stage, consumers will ask for advice when deciding which information to take into consideration and which not. They might also ask for advice once they have an opinion about one option and want to know what others think, which might change their mind. Friends, family or coworkers can sway consumers to eliminate non-brands or generic products from consideration.

As Sheena Iyengar has documented, too many choices ‘paralysed’ consumers when she had a supermarket put out dozens of jars of jam on shelves. Customers were more likely to buy jam when only a handful of varieties were on offer.

In the end game, consumers judge whether the product satisfies their desires, and this feedback can provide marketers with valuable information for tweaking their marketing and sales strategies.


Consumer buying behavior is a complex process it involve consumers identifying a saw, the information-search, the alternative evaluation, the option elimination, and the purchase decision is made. Psychological and environmental factors play a vital role in this process. Understanding why and how the customers making these decisions is very important to the organization for designing a specific targeted marketing slogans.

The psychological influence is that consumer consider motivation, perception, beliefs and learning experience, which these factors determine their attitudes in buying a product.
The psychological influences come into play when these questions are considered by the consumer:

  • why should I buy a product?
  • What is going to convince me in buying that product?
  • Do I believe the product I perceived reading the ad?
  • In short, what learning experience have I through (for) this product?
    When it comes to consumer buying behaviour, there are several factors that determine the final decision of the buyer. These factors allow businesses to influence the consumer’s behaviour in terms of:
  • providing the features > benefits for each individual product;
  • providing the right and reliable information in an easy-to-navigate website and forum;
  • using emotional appeals;
  • extraverted people are more drawn in purchasing cutting-edge tech products.


Marketers can leverage their customer insight to develop predictive strategies that capitalise on consumers and their decision-making process (aka, decision journey) w, a, a. Marketers need to define their target group, and fully understand the decision process: Problem recognition Information search Evaluation decision Purchase decision Evaluation post purchase Evaluation evaluation evaluation.

This information-search stage is characterised by researching and comparing potential products that could satisfy the need or want. The final choice includes not only internal factors (needs and beliefs) but also external ones (friends’ or family’s recommendations and advertising). Marketers use the factors that can push brands into this fragile gate, turning them into the optimally evoked set.

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Sydney Chadwick

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