Consumer decision making is a surprisingly complicated issue to research as much of it is completed sub-consciously, it is instinctive and based on a series of subtle heuristics and bias. Cultural background and interest in the category will influence the decision making at various points across the path to purchase. Brands are advised to use decision making analysis to ensure that the choices they offer the consumer are timely and genuinely useful, that they aid rather than inconvenience the consumer.

Definition

Consumer decision making is the process by which consumers identify their needs, collect information, evaluate choices, and, finally, make a purchase decision. These actions are determined by psychological and economic factors and can be influenced by environmental factors such as cultural, group, and social values.

Key insights

1. Too much choice can hinder consumer decision-making about ‘utilitarian’ products

The idea that consumers are always paralysed by an excess of choice is too simplistic - choice overload depends on the type of product or service being purchased. A study found people tended to demand and prefer more choice when searching for and choosing a ‘hedonistic’ product than they did for ‘utilitarian’ products. Utilitarian products typically include necessities such as detergents, toilet roll, milk – but can also include family cars and laptops – which tend not to generate much emotional response in the buying process. Hedonistic products are nice-to-have items that generate an emotional response and pleasure – such as perfumes, designer clothes, jewellery, and sports cars. Utilitarian purchases are also more open to ‘satisficing’ where picking an option that is ‘good enough’ may be the best option for many people. But even then, the concept of ‘good enough’ will vary from one person to another.