The Consumer Decision-Making and Buying Process – Part 1
The business world is attempting mightily to recover from the COVID-19 pandemic and now record inflation is hitting consumers – individual and business – in the wallet. This means that consumers must be more informed and enticed by products and services. Just because a product is on a shelf, doesn’t mean it will sell. Customers still must make decisions on what and when to busy something. We invite you to reflect on your sales process as we discuss the consumer decision-making and buying process. In this blog we will focus on identifying the five stages and explaining stage 1 and 2.
The Five Stages
The five stages of consumer decision-making and buying process are relatively unchanged since philosopher John Dewey proposed them in the early 1900s. These five steps are undertaken by consumers as they decide when and where to spend their money.
The five stages are:
- Identify a problem or need
- Enter an informational search
- Evaluate alternatives
- Make a decision
- Enter post purchase evaluation
Stage 1: Identifying Needs
During the first stage of the consumer decision-making and buying process, consumers must identify a problem or need. Consumers may conclude on their own they have a need. However, through marketing, promotion, or advertisement, they may find a product fills a need of which they were unaware. Creative marketing/production can show consumers a particular product is just the thing to complete their life. With the rise of digital marketing, search engine optimization, and the industrial complex that is social media, consumers are more surrounded than ever with products to serve every purpose imaginable.
Stage 2: Informational Search
In the second stage, consumers begin investigating solutions to their problem. During the information search, consumers seek to understand if they can solve the problem themselves or they need to outsource the solution to a product or service. This process can be overwhelming as the consumer wades through the options available to them. This stage is where great marketing and differentiation plays a key role.
How well a product or service is branded and featured will impact the consumer’s buying decision-making. Guided selling presents a great opportunity for a business to reduce or restrict a customer’s options. Guided selling, whether with a sales agent or through the use of software, can provide a business with the opportunity to direct the consumer to a particular product or service that best meets their need. If used responsibly, it is a win-win for the consumer and business.
In the digital age, businesses, services, or products may show up in online searches if they have optimized their websites for specific keywords or phrases commonly used to find solutions. In addition, purchasing ads on search engines and social media can increase the chance of being found. However, the more competitive an industry, the more expensive it is to be found through search engines and social media ads. This is because businesses are competing for digital real estate. Conversely, unique products and services that have fewer competitors may find landing prime digital real estate to be less costly or more effective.
Stay tuned for the next blog as we dive into stages three through five of the consumer decision-making and buying process.