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External Factors

Analysis of the External and Internal Factors Affecting the Buyer Decision-Making Process.
 

Consumers are continually developing their purchasing behavior based on various life circumstances. Consumer behavior denotes the process which buyers pass through when making purchases and it encompasses factors that affect their usage and decision (Berkowitz 2006, p.101). Various factors also influence consumers’ choice of retailers, the brands they buy, as well as their shopping habits. Moreover, consumers are always influenced by factors such as psychology, personality, membership faction, social cluster, subculture, and culture in their decision-making process (Rani 2014, p.54). Every consumer has to go through a process of decision-making when purchasing various products. The process has five stages including the recognition of a problem, information searching, alternatives’ evaluation, purchase decision, and after purchase behavior (Hoyer, Deborah & Rik 2013, p.189). Every stage in the decision-making process is strongly affected by the psychological, personal, social, and cultural characteristics of the consumers. Thus, the paper analyzes various internal and external factors that affect an individual’s decision to purchase a car. Both external and internal factors work together and are inter-linked to help the buyer in making various business decisions.

Consumer buying decisions are frequently influenced by factors or issues that are beyond their control. Consumers always encounter numerous external influences when making purchasing decisions such as an individual’s household structure, subculture, culture, and groups that he/she relates to (Dudovskiy 2013, par.4). They are called external influences by business owners and marketers because the influence source emanates from the customers’ external environment. The following is a detailed analysis of the external factors that influence consumer buying behavior.

People are known to be social by nature, and they love to relate with various groups. Groups signify more than two people who share common beliefs, norms, or values and interrelate to accomplish a mutual or individual goal (Wright 2006, p.24). It is evident that almost every consumer behavior occurs when an individual is in a grouping environment. Usually, the norms of a group cover every important aspect of the group’s functioning and flouting those rules may result in penalties. Moreover, a consumer’s behavior of buying goods and services can be influenced by the group’s nature. For example, a consumer can buy various products depending on the group’s cohesiveness, how frequently they interact and membership exclusiveness. Currently, various groups are focusing on the nature of products including their uniqueness and visibility characteristics (Szwacka-Mokrzycka 2015, p.151). Groups such as reference groups serve as comparison points for a person in developing either specific or general attitudes, and values. For instance, some people purchase Chevrolet car brand because, in their group, it signifies power and wealth.

Group Behavior

A family is a group of more than two individuals related by adoption, marriage, or birth and living together. Peoples’ immediate family associates play a significant role in affecting their buying behavior (Rani 2014, p.53). What individuals adopt from their parents eventually becomes their culture. In essence, when a person sees something from childhood, it becomes his/her habit or lifestyle. The family is the greatest basic consumption entity for many consumer goods. For instance, if a person is used to seeing members in their family drive a Mercedes-Benz, there is the likelihood that he/she in future will purchase a Mercedes-Benz.

Culture affects consumers through various values and norms formed by the existing society. Culture is an extensive environmental aspect that affects consumers’ behavior. According to various scholars, culture is always inculcated as it can be passed from one age-group to another through institutes such as religion and family members (Rani 2014, p.55). Additionally, when culture evolves it can affect the advantages of a brand or product with novel values. Hence, culture can make it necessary to change various products if the value cannot gratify the society, for example, TV series, or movies. Culture enables marketing managers to concentrate on customs, beliefs and values shared by a specific generation’s members to make them suitable clients for exceptional marketing attention. Therefore, individuals from cultures that value power, wealth, and influence will definitely purchase a car that exhibits these attributes such as Audi, Chevrolet, or Mercedes Benz. 

Various forms of social stratification or social structure have existed in every society throughout human existence. The social class of a consumer denotes his/her standing and ranking in society. Furthermore, there are numerous factors that determine an individual’s social class, for example, income, education, and occupation (Burrow & Bosiljevac 2012, p.168). Income is a significant determinant of social class, but there are other factors that compliment earnings. For instance, an individual’s area of residence, world-view, and cultural interests are vital factors that determine the social class of a person. Wright (2006, p.26), asserts that social class is measured on the basis of prestige, power, and relative wealth. Hence, there are various levels of the social class including the lower class, working class, middle class, and upper class. Each social class has its purchasing tendencies and lifestyle orientation. For example, the lower class likes purchasing the readily available goods and love having a close family relationship.

Family

The working class loves newest appliances, food items, and sporting events while the middle class always go for products in fashion, home items, nice clothing, and goods associated with self-presentation. On the other hand, the upper class loves art, traveling, equipment, quality merchandise as well as recreation and expensive hobby. In this context, the brand of a car that individuals purchase greatly depends on their social standing in the society. For instance, an individual from the low socio-economic background cannot afford to purchase a Mercedes-Benz or Chevrolet because their disposable income cannot allow that to happen.

Internal factors also known as psychological factors fall into four categories including learning, perception, motivation, needs as well as attitudes and beliefs (Lejniece 2011, p.1275).

Needs

Need recognition is an internal stimulus that tells an individual that there is a gap between his/her real situation and the desired and ideal one. Hence, need recognition is a significant and the foremost step in the process of purchasing any product (Rani 2014, p.56). Therefore, if a person wants to satisfy his/her need, he/she would not mind the type of car to purchase as long as it serves his/her need.

According to Lantos (2015, p.105), personality is a set of specific characteristics and traits of every individual. Personality encompasses the interaction of physiological and psychological characteristics that results in a person’s consistent behavior. Eventually, personality materializes into various traits such as sociability, confidence, ambition, charisma, autonomy, shyness, adaptability, and curiosity. Consequently, the personality of a consumer will influence his/her purchasing habits and shopping behavior (Rani 2014, p.56). For instance, people tend to purchase car brands that reflect their personality in the society.

It is evident that people learn through actions. When people act, they learn. It means that an individual’s behavior changes as he/she acquires experience and information (Nayeem & Casidy 2015, p.70). For example, when a person has a bad experience with a product, he will not buy it in future because he has learned its shortcomings. However, if customers have a good experience with certain products they will buy them in future.

According to Barber & Dodd (2009, p.53), beliefs are convictions that individuals have on something. Through the experiences that consumers acquire, their learning and their external influences, they develop beliefs that influence their buying behavior. On the other hand, attitude is a feeling, an evaluation of an idea or object and the tendency to take action in a particular manner toward that idea. Attitudes allow people to develop a consistent behavior against a group of same ideas or objects. Equally, attitudes and beliefs are anchored in the mind of an individual and are hard to change. Therefore, if an individual believes that Toyota is the quality car brand in the market, it becomes very tough to change his/her mind regarding the brand.

Culture

Perception is the procedure through which a person organizes, selects, and interprets any received information in order to take an action (Lejniece 2011, p.1275). The perception regarding any situation can decide how and if an individual will decide to do something. Experiences, personal characteristics, and beliefs of people will have varied perception regarding different products such as car brands. 

Motivation drives a consumer to develop a buying or purchasing behavior. Motivation involves a need expression which becomes persistent forcing the consumer to desire to satisfy the same need (Lejniece 2011, p.1276). Additionally, motivation works at the subconscious level, the reason it is hard to measure. In essence, motivation is linked to the need and is articulated in the similar classification type as described in the levels of the customer purchasing decision process (Jham & Puri 2014, p.3).

Utility theory posits that decisions are made by consumers based on the outcomes they expect from the decisions they make. For this reason, consumers tend to make a decision that will maximize their well-being. For example, if a consumer intends to purchase a car, he/she would search the internet to identify the brand with the highest utility. Prospect theory, on the other hand, posits that an item is considered valuable if it is owned by few individuals in the society. To showcase class and power, an individual will prefer buying car brands such as Lexus and Mercedes-Benz. Consideration theory points out that a consumer always has a list of brands to choose from when making a purchasing decision. However, the consumer will always choose from the active brands in the market. The involvement theory argues that a brand is chosen based on its significance in the life of the consumer. For instance, individuals belonging to certain groups will favor certain brands because they denote a sense of belonging.  

References

Barber, N., & Dodd, T., 2009. The Influence of Purchase Confidence on Information Source Selection: Implications for Hospitality Industry. FIU Hospitality Review, 2(1), pp. 37-57.

Berkowitz, E.N., 2006. Essentials of Health Care Marketing. Sudbury, Mass: Jones and Bartlett Publishers.

Burrow, J., & Bosiljevac, J., 2012. Marketing. Mason, Ohio: South-Western Cengage Learning.

Dudovskiy, J., 2013. Consumer Decision-Making Process: A Detailed Analysis. 

Hoyer, W.D., Deborah, J.M., & Rik, P., 2013. Consumer Behavior. Australia: Mason, OH: South-Western Cengage Learning.

Jham, V., & Puri, S., 2014. Cases on Consumer-Centric Marketing Management. Hershey, PA: Business Science Reference.

Lantos, G.P., 2015. Consumer Behavior in Action. London: Routledge.

Lejniece, I., 2011. Factors Affecting Consumer Behavior Assuming and Fulfilling Credit Liabilities in Latvia. Economics & Management, 16, pp. 1274-1278.

Nayeem, T., & Casidy, R. 2015. Australian Consumers' Decision-Making Styles for Everyday Products. Australasian Marketing Journal (AMJ), 23, pp. 67-74.

Rani, P., 2014. Factors Influencing Consumer Behavior. International .Journal of Current Research and Academic Review, 2(9), pp.52-61.

Szwacka-Mokrzycka, J., 2015. Trends in Consumer Behavior Changes. Overview of Concepts. Acta Scientiarum Polonorum. Oeconomia, 14(3), pp. 149-156.

Wright, R., 2006. Consumer Behavior. London: Thompson Learning. 

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