Ideology of consumer choice

The ideology of consumer choice pertains to the dynamics of decisions that the consumers make regarding purchasing products and services. Essentially, the forces of production and consumption are largely affected by the orientation of consumers towards a product or service. Indeed, the high the tendency of consumers to select a certain product, the high the demand and, subsequently, the necessity for availing the product at a high volume. Nonetheless, consumer choice is a tenet that is shaped by a number of factors that influence the way consumers behave towards their selection of products and services. Therefore, comprehending the dynamics of consumer choice is a valuable avenue for businesses as it helps in the development of sustainable business models. As such, the most of the successful business delegate a whole department for purposes of research and development that has to gather and analyse information relating to consumer choices. Notably, the ideology of consumer choice has been studied in the past, giving rise to theories and processes that help in dissecting the subject into comprehensible elements that are used in business strategizing process. This study focuses on providing a concise explanation of the ideology of consumer choice. More importantly, special attention is given to the fundamental aspects of consumer choice. These fundamental tenets entail the consumer theory, the consumer choice process and the drivers of consumer choice.

Consumer theory

A fundamental theory emerging from the study of consumer choice is the consumer theory. In essence, consumer theory seeks to explain how a rational consumer makes choices regarding consumption.[1] Based on consumer theory, customers make choices of services and goods on the premise of optimal benefit realization. The consumer theory depicts how people base their choice of services on income and price, which leads to an understanding the impact of income and preferences on demand curve. Consequently, the customer’s problem is formulated indicating that a consumer choses a vector of goods to maximize their utility taking into consideration the budget constraints that dictates the amount that the consumer can spend, which is lower than the total wealth held.[2] Nonetheless, for the theory to hold, some assumptions need to be made. The assumptions include; first, the availability of perfect information underlying the process of making choice. As such, the consumer is assumed to act rationally regarding the presented products. Additionally, the consumer has complete information about the product, whereby the consumer understands the complete utility of the product. Additionally, the consumers are assumed to have the capacity to seek relevant information pertaining to existing alternative services and products that can meet their desires.[3] Consequently, they can make trade-offs rationally.  From this theory, it is possible to relate the current society’s tendency to glorify choice as an interesting aspect of living. However, there are issues related to the scale at which the choice is presented. As observed by Renata Alecl (2010), it has become a cumbersome endeavor to become oneself. It is a journey that has resulted in people spending significant amount of time and money learning how to become themselves. This aspect is evidenced by the list of bestsellers that offer strategies geared toward redefining the audience’s life.[4]  Essentially, the goal is trying to customize lives to make them perfect, which fails to lead to satisfaction, but rather breeds anxiety. Consequently, given the increasing eagerness to seek expert advice points towards relieving the burden of choice.

Consumer choice processes

Consumers do not always have predetermined existing preferences, but decide based on various factors. The dynamic market causes consumers to follow a decision-making process whenever they intend to pay for a good or service. It is a concise process consisting of five steps. When buying a product, a consumer has to contend with phases that include recognition of the existence of a need, search of information, evaluation of alternatives, purchase decision and post-purchase behavior. However, it is not always definite that the customer follows the process consensually.

Firstly, the consumer recognizes an existing need that has to be satisfied.[5] If a consumer does not identify the need, it is unlikely that they will proceed to the other steps in the process. Subsequently, it is the initial and critical step in the consumer choice process. Nonetheless, the recognition of the need has to be triggered by factors in the environment. Abraham Harold Maslow, a psychologist best known for creating the hierarchy of human needs, identified different levels in which human needs can be categorized.[6] Notably, consumers identify their needs either by internal or external stimuli. The external stimuli category consists of products or services in the market, while the internal stimuli consist of urges to consume a product or a service. The second phase entails searching for appropriate information about the existing products or services that can satisfy the identified need. It is necessary for a consumer to be well familiarized with their product of choice. The consumer has to identify sources of information relating to the solution for the existing problem. Thirdly, the evaluation of available alternatives to the problem. The alternative with most value in the products attribute or services are selected.[7] A consumer usually leverages the satisficing strategy to determine the best alternative by considering the attribute value in the order of preference. In the fourth stage, a purchasing decision is made for the product or service that meets the need. Kotler and Keller (2012) posits that purchasing can be affected by two factors. These factors are the negative feedback from other consumers and the ability to accept or assume the negative perception of the product or services.[8] Lastly, the post-purchase behavior involves activities following the purchase. Consumer may be satisfied or dissatisfied with their purchase. They may regret the foregone alternatives or feel happy if the selected product satisfied their need.

Drivers of consumer choice

The ideology of consumer theory cannot be completely comprehended without examining its drivers. In essence, the notion of consumer choice is pegged on factors such as the level of income, terms of payment, and marketing effort.

Income

The income economic factor is a core driver of consumer choice. The high the disposable income that a person has the high the likelihood that they will spend it on certain products. Essentially, given the price differentiation of products and services, a consumer is forced to make the choice of purchasing the products that befits their level of disposable income. Nonetheless, the tendency to spend can also be affected by the nature of needs. It is rational for consumers to first apportion their income to cater for the basic needs before the luxury goods. However, even the choice on the amount to be apportioned for the basic needs has to be made and primarily depends on the disposable income held by the consumer. Additionally, the discretionary needs that are aimed at improving the quality of life have to be apportioned a certain amount of money. These discretionary needs are often satisfied using luxury goods. Notably, the level of choice of one type of luxury good over another is made based on the income that remains once the basic needs have been paid for satisfactorily. The income level is a significant driving factor towards consumer choice given that it influences their purchasing power.

Terms of payment

The terms of payment can significantly influence the choice of a consumer given the perception of time value of money. Essentially, there are items which consumers may not be able to pay upfront using cash payments. However, if the same product or service is offered in payment terms that allow the consumer to make smaller payments for a period, there is a likelihood that the customer may opt to make a choice of consuming the good or service. In essence, based on the utility that the customer anticipates to attain, he/she can make a choice of one product over another. For instance, a consumer having the desire to buy a house may not have the exact amount to purchase the house. However, given the option of a mortgage, depending on the level of expected income, the consumer would rationally chose to proceed with the mortgage. In any other case, the consumer would be stuck with paying for a rental house. In contrast, were the consumer having enough money to purchase, they would rationally opt for paying upfront as it would save them a fortune in interest that would accrue over the period provided for paying the mortgage. Additionally, the existence of discounts can also influence the choice of purchase of a consumer. In the case, where a consumer anticipates that a discount will be available in the future, the consumer would likely chose to differ buying the item until a time when the terms of payment are favorable. For instance, it has become culture for merchants to offer reasonable discounts during the festive seasons. Therefore, a consumer who desires to buy an item at a discount can choose to wait until, the festive seasons commence, and hope that the product will be offered at a discount. Subsequently, the consumer can have the product at a discounted price.

Marketing effort

Previous studies indicate that consumer related marketing influences consumer choice by engendering favorable attitudes and purchase intentions. Survey-based methodologies have been used to illustrate a relationship between consumer choice and marketing effort. Positively perceived by consumers, marketing effort would heighten the probability of choice of a company’s products and services.[9] Marketing has been utilized as a tool for increasing the consumption of products. A marketing strategy is viewed to be successful given that it results in a high the number of products getting sold. Strategies such as branding of products have been considered crucial for marketing products. According to Klein (2000), since the mid-1980s corporations attained unparalleled success through producing brands.[10] The invention of branded goods is a development that highly influenced the customer choices. In essence, the brands manifested as single manufacture’s effort to establish a link to the consumers by offering standardized products, of a standard quality and given a standard name, packaging and price. The examples include the marketing of butter, soap, clothes and soft drinks. Some of the brands that have stood the test of time and dominated their niche industries include Levi’s, Coca Cola, Nestle, Colgate and Lurpak, just to mention but a few.[11]

Conclusion

The ideology of customer choice entails understanding the manner in which consumers tend to make decisions regarding purchase of goods and services. Understanding the customer choice ideology is essential in guiding the process of marketing targeted products and service. It facilitates in defining the path towards success or failure of a business model depending on how it is applied. The consumer theory developed after studying the dynamics of consumer behavior provides an intriguing perspective, and creates a foundation for understanding the consumer choice ideology. It holds that consumers always seek for maximum benefit taking into consideration the constraint of budget. In essence, comprehending consumer ideology necessitated delineating the process that consumers go through before settling on a specific product or service. Ultimately, the factors that drive consumer choice also offer an interesting angle for understanding the ideology. These factors include the level of income, the terms of payment and the marketing strategies used by the business to offer goods and services.

References

Barone , Michael J. , Anthony D. Miyazaki , and Kimberly A. Taylor. 2008. “The Influence of Cause-Related Marketing on Consumer Choice: Does One Good Turn Deserve Another? .” Journal of the Academy of Marketing Science. 248-262.

Boeree, George C. 2006. Abraham Maslow: Personality Theories. Shippensburg, May 05.

Bettmann, James R, Mary Frances Luce, and John W. Payne. 1998. “Constructive Consumer Choice Processes.” Journal of Consumer Research 187-217.

Foxall, Gordon R. 2005. Understanding Consumer Choice. London: Palgrave Macmillan.

Hansen, Flemming, and Sverre Riis Christensen. 2007. Emotions, Advertising and Consumer Choice. Copenhagen : Copenhagen Business School Press DK.

Klein, Naomi. 2000. No Logo. Toronto: Knopf Canada.

Kotler, Philip, and Kevin Lane Keller. 2012. Marketing Management. New Jersey: Prentice Hal.

Levin, Jonathan, and Paul Milgrom. 2004. Consumer Theory. Smithton, Pennsylvania, October 06.

McLeod, Saul. 2016. Maslow’s Hierarchy of Needs. June 7. Accessed January 6, 2017. http://www.simplypsychology.org/maslow.html.

Salecl, Renata. 2010. The Tyranny of Choice. London: Profile Books.

Stone, Deborah. 2009. “The False Promise of Consumer Choice.” Saint Louis University Law Journal 476-489.

[1] Flemming Hansen and Sverre Riis Christensen. 2007. Emotions, Advertising and Consumer Choice. Copenhagen : Copenhagen Business School Press DK, 17.

[2] Jonathan Levin and Paul Milgrom. 2004. Consumer Theory. Smithton, Pennsylvania, October 06, 1.

[3] Stone, Deborah. 2009. “The False Promise of Consumer Choice.” Saint Louis University Law Journal, 478.

[4] Renata  Salecl. 2010. The Tyranny of Choice. London: Profile Books, 2.

[5] Gordon R Foxall. 2005. Understanding Consumer Choice. London: Palgrave Macmillan, 36.

[6] George C Boeree. 2006. Abraham Maslow: Personality Theories. Shippensburg, May 05.

[7] James R Bettmann,  Mary Frances Luce, and John W. Payne. 1998. “Constructive Consumer Choice Processes.” Journal of Consumer Research, 190.

[8] Philip Kotler and Kevin Lane Keller. 2012. Marketing Management. New Jersey: Prentice Hal, 209.

[9] Michael J. Barone , Anthony D. Miyazaki , and Kimberly A. Taylor. 2008. “The Influence of Cause-Related Marketing on Consumer Choice: Does One Good Turn Deserve Another? .” Journal of the Academy of Marketing Science, 250.

[10] Klein, Naomi. 2000. No Logo. Toronto: Knopf Canada, 25.

[11] Hansen and Christen, 87.