Topic 6 Situational Influences In Decision Making

In Topic 2 through 5 we saw how consumers go about making decisions and how at times their decisions become habitual. 

Because purchasing and consuming are objectives of consumer decisions, the situation in which consumers purchase and consume products and services influences what they buy. 

Regarding Purchases the following normally influences; 

• Type of store (Small shop, Shopping Mall, Department Store etc.)
• Purpose of the purchase (Gifts for others or something for yourself)
• Context of the purchase (Shopping alone, with friends, assisted by salesperson)

Consumption Situations directly affect purchasing behavior.  

The Purchasing Situation as well as Consumption Situation is central to marketing strategies.

Example: Gift giving situation is often the basis for advertising products such as watches, electronics and toys. Manufacturers frequently advertise products for Fathers or Mothers day and for holidays such as Christmas. 

Fifty percent of sales for retail outlets occur during Christmas and Thanks giving days and most are for gift giving occasions.  

The Nature of Situational Influences

 

Situational Influences – Are temporary conditions or setting that occurs in the environment at a specific time and place. Examples: Shopping for gifts, going skiing and jogging. 

Situational influences are important because the usage situation is important in affecting brand choice.Marketing Strategies have to be planned in a way that it is geared to consumer needs and preferences. Marketers must understand these needs and preferences for a particular usage situation. Marketers to gain understanding of such situation must therefore consider the following;

• The Types of Situations that influence consumers’ decisions
• The Characteristics of these situations.
• How the situations affect consumers behavior in the context of a model of situational influences.

 

 

 

The Purchase Situation

 

The purchase situation affects many consumer decisions. Three factors are particularly important in affecting marketing strategy based on the purchasing situation;  

The In-Store purchase situation.

Whether the purchase situation is for a gift- giving occasion.

Whether the purchase situation is unanticipated. 

The In-Store purchase situation

In-Store stimuli such as;

• Product Availability.

• Shelf Position.

• Pricing Promotions.

• Displays and Ease of shopping.

Above stimuli are important in influencing consumer purchasing decision, especially for unplanned purchase. Studies have found several factors influencing unplanned purchase such as; 

Price promotion – 56% respondents bought more unplanned items because of these in-store stimuli

Free Samples – 35% respondents bought more unplanned purchase of free samples

Displays – 27% of respondents bought more unplanned items because of displays.

It is important for marketers to identify various in-store situations and ask consumers how they would respond.

Example: You are in the store and find that your favourite brand of cereal is not in stock. (Do you go to another store, buy a substitute brand, or delay the purchase?). Your favourite brand of cereal costs five cent more than it did the last time you bought it (Do you continue to buy it?). 

Gift – Giving Situation

The second purchase-related situation is whether consumers buy the product as a gift or for themselves.  Purchasing a gift is likely to be more involving for consumers than purchasing a product for themselves because they want to ensure that they are sending the right message in terms of the type of gift, its price and brand name.

The gift-giving situation has been described as a cultural ritual. The consumer acquire a gift, removes the price tag, wraps the item, delivers it, awaits a reaction, receives a gift in return in some circumstances and conveys a reaction. This process of exchanging gifts creates bonds of trust and dependence between the parties. The nature of Gift-Giving ritual is also culturally bound in some societies.
 

Unanticipated Purchase Situation

Purchase situation can sometimes be unanticipated. For example, if unexpected guest arrive, consumers may make a special shopping trip and pay higher prices to obtain needed item quickly.

Consumption Situation

The consumption situation defines the context in which the consumer uses the brand. A consumer may use a particular brand of perfume or cologne for special occasions and another brand for everyday use. Another consumer may use a different brand laptop for office use versus a different brand for use at home. 

The consumption situation is also likely to affect consumers’ choice of services example; Health. Whether the health problem is major or minor; whether the health problem affects the consumer or another member of the family; whether the health problem occurs at home or away from home.

Marketers must identify consumption situations relevant to the product category.

Communication Situation

The communication situation is the setting in which consumers are exposed to information.

• Person to person (word-of-mouth)

• Friends and neighbours

• Information from a Salesperson

• Advertising, In-Store displays 

The communication situation could determine whether consumers notice, comprehend, and retain information. Three types of situations may affect consumer response. 

1. The Exposure Situation
2. The Context of the Communication
3. The Consumers mood or state while receiving the communication

Example: Re Advertising Exposure
 

Did the consumer hear a radio commercial while riding in the car or while sitting at in the living room of his home? Did the consumer read a magazine inside or outside the home? A second situational exposure variable is the communication context in which it appears. Example:  Did the communication appear during a Happy program or Sad program? 

The third variable: Was the consumer in a happy state when receiving the communication. 

Characteristics of Consumption and Purchase Situations

Situations are likely to be made up of several of these characteristics: 

Physical Surrounding – Store’s decoration and shelf outlet. Being indoor or outside when using a product

Social Surroundings – whether guests are present, social occasion, friends and neighbors when using the product

Time – Breakfast, Lunch, Dinner, winter, summer or spring or autumn.

Task Definition – Shopping for oneself or for the family.

Antecedent State – momentary conditions such as shopping when tired or anxious, buying a product on impulse. 

The Experimental Nature of Situational Influences 

Of the three types of situation that we have talked about; Consumption Situation; Purchase situation and Communication situations – Marketers have tended to concentrate on the Purchase Situation because they quiet naturally focus on sales results. 

The Purchase Decision reflects consumer choice, but it is the consumption experience that ultimately determines whether the consumer is satisfied and repurchases the product. 

Marketers need to ask the following questions;

Under what circumstances is the new product most likely to be used? (Physical Surrounding).

Will it be used in a social context? (Social surrounding).

When will it be used? (Time).

What tasks are required for usage? (Task Definition).

What are the various attitudes and emotions that are likely to affect usage at various times? (antecedent State). 

The above questions reflect the nature of the consumption experience and it can provide marketers competitive edge over their competitors.

Characteristics of the Purchase and Consumption Experience on WEB

 The internet provides a particular focus on the purchase and consumption experience. In the broad sense Internet users are consuming information when using the web to help them make purchase decisions.

Marketers can evaluate purchase and consumption situation on the web as follows;

Physical Surrounding – At home or in the Office.

Social Surroundings – Using the web as a solitary pursuit is different from using it in a social context.

Time – Time poverty is one of the biggest motivators for web usage.

Task Definition – There are multiple tasks for which consumers use the web to find information or to make a purchase. Hedonic or Utilitarian.

Model of Situational Influences

Antecedent State – Can have both positive and negative effects on web usage.

Simple Model of Consumer Behavior – Three (3) possible Influences on Purchasing Behavior; (Topic 1). 

• The Consumer
• The Environmental Influences
• Marketing Strategy 

A model of situational determinants on consumer behavior describes behavior as a function of the same three basic forces except that the; 

Consumers’ environment is represented by the consumption, purchase, or communications situation.

Marketing strategy is represented by product being consumed.

 

The two outside forces acting on consumers are the PRODUCT and the SITUATION. The consumer reacts to the product and the situation and decides on the brand to be purchased. 

The interaction between the consumer’s psychological set (needs attitudes and preferences), the situation, and the product results in a process of choice leading to behavior. 

The Situation and the Product can be viewed in term of the principles of:-

Context; Figure (Foreground)

Ground (Background). 

Example in any print advertisement, the product generally appears in the foreground and the situation in the background. In most cases, the background provides a relevant context for the product. 

Consumer Attributions To Situation Versus Product 

A key consideration in the situational model above Figure 5.1 is whether consumers attribute their behavior to the product’s characteristics or to the situation.  Consumer researchers have used Attribution Theory to answer this question.

Attribution Theory

– States that people attribute a cause to their prior behavior.  If consumers attribute behavior to the product rather than to a situation, attitudes towards the product are more positive, increasing the likelihood that consumers will purchase the product again.

On the other hand, if attribution is to the situation (e.g. product on sale) their attitude towards the product is not likely to be positive.

 

Several principles can be stated in determining whether the product or the situation is a more important influence on consumer behavior; 

• The greater the degree of brand loyalty.
• The higher the level of enduring product involvement, the less likely the situational factor determine the behavior.
• When a product has multiple uses, situational factors are less important in determining brand choice.

In summary, situational factors tend to be less important when consumers are loyal to a brand, when consumers are involved with the product category on an ongoing basis and when the product has multiple uses. 

Proximity of Situation to Behaviour 

Another issue relevant to the situational model is the proximity of the situation to behavior. If the purchase and the situation are close in time, than the situation is likely to influence brand choice. 

Example:

Consumer A - is shopping for food for a big dinner party that evening may buy items not ordinarily purchased.

Consumer B - who sees a sharp reduction in price for a particular brand (a purchase situation) may buy it even though it is not among those brands regularly purchase. 

In both cases behavior is situation-specific. 

Situational Influences on Product Attitudes, Choices and Decision Making 

Research on situational influences tended to focus on three areas;

 

Product Attitudes – e.g. A food prepared conveniently for lunch not dinner.

Product Choice – Wine and beer purchase for a party and not meal occasion.

Consumer Decision Process – Selecting gift or for oneself. 

Influence on Product Attitudes

 

Vary depending on the different situations – Example: Evaluating fast food outlets for snack or lunch rather than for dinner. Differences in attitude maybe in term of strength and weaknesses (Low in taste, quality etc.). 

Influence on Product Choice

 

Example: Prediction of choice of fast food outlet using a non-situation model and situational model.

Influence on Decision Making

Different situations on decision making. 

Use of Situational Variables In Marketing Strategy 

Marketers can use situational variables in marketing strategy in two ways;

1. By introducing new usage situations
2. By targeting existing ones

Introducing New Usage Situations

 

An effective marketing strategy is to influence consumers to use the product for new usage situations. E.g. the introduction of car wax in the 1990s when Johnson Products discovered that consumers were using their furniture waxes on cars. (Get you car shiny as you get your dining room table) congruent. 

Targeting Existing Usage Situations 

Marketers can target existing usage situation through the following strategies; 

• Segmenting users by product usage.
• Developing new products to appeal to specific usage situation.
• Advertising to position products to a particular usage situation.
• Distributing products to satisfy situational need.
• Targeting web sites to specific situations.

Students are encouraged to search other text books to enhance your knowledge on the subject.

 

Source: Henry Assael (2005) Consumer Behavior A Strategic Approach (Biztantra)