Understanding what drives the purchase decision in pension and investment products

The aims of this paper are to first seek an understanding of consumer decision-making when purchasing pension and investment products, and second to ascertain how this decision-making affects the consumer's choice of distribution route. The study employed both focus groups and postal questionnaire survey methods based on the framework of a classical decision-making model that investigated problem recognition, information search, evaluation tools used and post-purchase. The findings show that the decision-making process experience differed to a lesser or greater degree depending on the distribution route. The majority of respondents had recognised the need to make a purchase decision long before seeking information. Younger respondents on all incomes believed that they must make some pension provision for themselves as opposed to relying on the government's retirement provision. Many changed channels for information searches, but tended to settle with the Independent Financial Adviser (IFA). The two main evaluation tools for pension and investment were found to be the ‘charges’ and ‘historic fund performance’. The vast majority of respondents reiterated their worry that the outcomes would not be known until retirement. In terms of analysis by the level of ‘financial literacy’, respondents who scored in the upper quartile were more inclined to be on a higher income, less inclined to evaluate on charges and more proactive in discussing the investment strategy of their pension fund. Respondents who scored in the lower quartile had opposite results. One of the implications of these findings is that the younger respondents’ recognition of pension savings favours the government's intention to reverse the existing balance of pension distribution. The other main implication is that the findings will be of help to managers in appreciating the dominance of the IFA channel by providing an explanation of why consumers choose this route, and, additionally, can assist direct marketing managers in identifying customers who will be more likely to use multichannel or single-channel shoppers. It can also help the marketing manager increase the usage of different channels by addressing the factors driving the purchase decision and distribution choice.

Purchase decision-making is modulated by vestibular stimulation

Purchases are driven by consumers’ product preferences and price considerations. Using caloric vestibular stimulation (CVS), we investigated the role of vestibular-affective circuits in purchase decision-making. CVS is an effective noninvasive brain stimulation method, which activates vestibular and overlapping emotional circuits (e.g., the insular cortex and the anterior cingulate cortex (ACC)). Subjects were exposed to CVS and sham stimulation while they performed two purchase decision-making tasks. In Experiment 1 subjects had to decide whether to purchase or not. CVS significantly reduced probability of buying a product. In Experiment 2 subjects had to rate desirability of the products and willingness to pay (WTP) while they were exposed to CVS and sham stimulation. CVS modulated desirability of the products but not WTP. The results suggest that CVS interfered with emotional circuits and thus attenuated the pleasant and rewarding effect of acquisition, which in turn reduced purchase probability. The present findings contribute to the rapidly growing literature on the neural basis of purchase decision-making.

Purchase decision-making in fair trade and the ethical 'gap':'is there a fair trade twix?'

Children are increasingly being recognised as a significant force in the retail market place, as primary consumers, influencers of others, and as future customers. This paper adds to the literature on children as consumers by exploring their attitudinal responses to a specific group of products: Fair Trade lines. There has been no research to date that has specifically addressed children as consumers of Fair Trade or the ethical purchase decision-making process in this area. The methodological approach taken here is an essentially interpretive and naturalistic analysis of two focus groups of school children. The analysis found that there is an urgent need to develop meaningful Fair Trade brands that combine strong brand knowledge and positive brand images to bridge the ethical purchase gap between the formation of clear ethical attitudes and actual ethical purchase behaviour. Such an approach would both capture more of the children’s primary market and influence future purchase behaviour. It is argued that Fair Trade actors should coordinate new marketing communications campaigns that build brand knowledge structures holistically around the Fair Trade process and that extend beyond merely raising consumer awareness.

One rapidly growing market of Sweden: organic food : A qualitative study portraying some consumers’ decision to purchase organic food

In recent years there has been a significantly rising trend amongst consumers for health and environmental issues, which has resulted in greater attention for and sales of organic food. Organic food production strives to use natural resources, such as land, energy and water in a sustainable way and the products does not contain artificial fertilizers or chemical pesticides. However, organic food products are also often more expensive and less available in comparison to conventional food products. Despite this, interest for and sales of organic food products have increased around the globe, and in Sweden particularly, the increase in sales has grown largely from an international perspective. This thesis is of qualitative character and is focused on studying some consumers from the Swedish market of organic food. The purpose of this thesis is to contribute with a better understanding on the buying decision process regarding organic food purchase. To achieve this, the authors have studied some consumers that purchase organic food and have searched for patterns that could be identified in the decision process. The consumer buying decision process model has been used for portrayal of the chosen consumers’ decision to purchase organic food products. Interviews with six Swedish consumers were conducted, whereas each respondent continuously purchase organic food products. Results show that the purchase of organic food products begins with discovering an unsatisfied need state, which the consumers of this study desired to change with the purchase of organic food products. This study show how six consumers reason when passing through the stages of the buying decision process, in order to satisfy their desired need state. The authors found that the respondents feel satisfied with purchasing organic food products, which lead them in to continuously buying these products. Altogether, the findings contribute with knowledge that can come to be helpful when wanting to understand more about the consumer decision to purchase organic food.

The impact of dry matter, ripeness and internal defects on consumer perceptions of avocado quality and intentions to purchase.

Insights into the relative importance of various aspects of product quality can be provided through quantitative analysis of consumer preference and choice of fruit. In this study, methods previously used to establish taste preferences for kiwifruit (Harker et al., 2008) and conjoint approaches were used to determine the influence of three key aspects of avocado quality on consumer liking and willingness to purchase fruit: dry matter percentage (DM), level of ripeness (firmness) and internal defects (bruising). One hundred and seven consumers tasted avocados with a range of DM levels from ~20% (minimally mature) to nearly 40% (very mature), and at a range of fruit firmness (ripeness) stages (firm-ripe to soft-ripe). Responses to bruising, a common quality defect in fruit obtained from the retail shelf, were examined using a conjoint approach in which consumers were presented with photographs showing fruit affected by damage of varying severity. In terms of DM, consumers showed a progressive increase in liking and intent to buy avocados as the DM increased. In terms of ripeness, liking and purchase intent was higher in avocados that had softened to a firmness of 6.5 N or below (hand-rating 5). For internal defects, conjoint analysis revealed that price, level of bruising and incidence of bruising all significantly lowered consumers' future purchase decision, but the latter two factors had a greater impact than price. These results indicate the usefulness of the methodology, and also provide realistic targets for Hass avocado quality on the retail shelf.

The influence of price changes on consumers' purchase decisions

The development of an effective pricing strategy requires the acquaintance of consumers’ price perception as well as the range of elements that influence the price sensitivity. This paper analyses the relationships between product features, individual characteristics and the level of price increase/decrease that induces the consumers to change their purchase decisions. The results of a dedicated survey show, that price sensitivity, individual preferences, type of product and direction of price change and individual characteristics of consumers (gender, age, professional situation) have a significant impact on a threshold at which people are willing to choose the less attractive, but cheaper alternative to their favorite product or give up the variety in consumption. From a consumer behavior perspective, these findings play a fundamental role in pricing.

Determinants of Consumer Purchase Decisions of Health Insurance in Kerala

This research work was to study the level of awareness of consumers about health insurance concept and market, consumer perceptions about health insurance providers, schemes and various factors that influence buying decision of health insurance. There is need to bring entire age group – high risk and low risk under health insurance cover. Widening the cover of health insurance calls for indepth understanding of consumer thinking and extensive marketing efforts based on that. Hence the study of consumer perceptions and the impact of different contributing factors on consumer purchase decision assume significance to the marketer. Understanding the consumer thinking on health insurance will also be of relevance to governmental/non governmental agencies, as affordable health care to all is a policy objective of the government and new schemes are being launched in this area.

The role of external influences in high involvement purchase behaviour

Purpose
The purpose of this paper is to discover the consumer decision-making style clusters within the context of automobile purchases in Australia. It also examines the differences between consumer decision-making styles in terms of the importance given to external influences, such as importance of dealers, importance of friends/family members, number of cars test driven, time spent researching final decision and importance of information sources (e.g. internet, magazines, TV ads, word of mouth, etc.), prior to making their final purchase decision.

Design/methodology/approach
Data were collected from 209 respondents using self-administered questionnaires. Cluster analysis and ANOVA were employed to identify and analyse the differences between consumer decision-making style clusters. Consumer Styles Inventory (CSI; Sproles and Kendall, 1986) was used to measure respondents’ consumer decision-making styles in relation to automobile purchases.

Findings
Three clusters were identified from the analysis, namely “innovative informed”, “rational confused”, and “traditional habitual”. Significant differences were found between the clusters in terms of the average time they spent with each car dealer, the time they spent on researching final decision and the importance of consulting with family members prior to making their final purchase decision.

Practical implications
The paper found that some consumers rely heavily on friends/families and dealers as the most important sources of information. Other sources of information consumers use include television advertisements, newspapers, billboards and magazines. Based on the findings, marketers should focus on providing similar types of information/messages by using these above-mentioned sources when communicating with this type of consumers. Dealers could be trained to spend time explaining product features and benefits in full with these consumers and their friends and family members whom they are likely to bring along before making the final purchase decision.

Originality/value
The findings of this study have extended the knowledge by determining the impact of external influences on consumer decision-making styles using the CSI in context of specific product which is yet to be known in relation to Australian automobile consumers.

Mother-child interactions in youth purchase decisions

This study examines the impact of mother-child interactions on youth purchase decisions with a clear focus on dependent young adults living in the parental home. Two studies were carried out using both quantitative and qualitative approaches in order to understand the characteristics of young adults’ purchase decision-making. In the first study, a survey was distributed among young adults, and in the second study, several short essays from pairs of young adults and their mothers were analysed. Findings suggest that mother-child communication has a significant impact on children’s consumer decision-making style. Furthermore, these results draw particular attention to the laissez-faire communication style, which is relevant due to both its prevalence and its influence on youth decision-making. We also conclude that the product or service category is a critical consideration when the independence of young adults is evaluated in relation to their purchases.

Essays in environmental economic valuation and decision making in the presence of an environmental disaster

The first essay developed a respondent model of Bayesian updating for a double-bound dichotomous choice (DB-DC) contingent valuation methodology. I demonstrated by way of data simulations that current DB-DC identifications of true willingness-to-pay (WTP) may often fail given this respondent Bayesian updating context. Further simulations demonstrated that a simple extension of current DB-DC identifications derived explicitly from the Bayesian updating behavioral model can correct for much of the WTP bias. Additional results provided caution to viewing respondents as acting strategically toward the second bid. Finally, an empirical application confirmed the simulation outcomes. The second essay applied a hedonic property value model to a unique water quality (WQ) dataset for a year-round, urban, and coastal housing market in South Florida, and found evidence that various WQ measures affect waterfront housing prices in this setting. However, the results indicated that this relationship is not consistent across any of the six particular WQ variables used, and is furthermore dependent upon the specific descriptive statistic employed to represent the WQ measure in the empirical analysis. These results continue to underscore the need to better understand both the WQ measure and its statistical form homebuyers use in making their purchase decision. The third essay addressed a limitation to existing hurricane evacuation modeling aspects by developing a dynamic model of hurricane evacuation behavior. A household's evacuation decision was framed as an optimal stopping problem where every potential evacuation time period prior to the actual hurricane landfall, the household's optimal choice is to either evacuate, or to wait one more time period for a revised hurricane forecast. A hypothetical two-period model of evacuation and a realistic multi-period model of evacuation that incorporates actual forecast and evacuation cost data for my designated Gulf of Mexico region were developed for the dynamic analysis. Results from the multi-period model were calibrated with existing evacuation timing data from a number of hurricanes. Given the calibrated dynamic framework, a number of policy questions that plausibly affect the timing of household evacuations were analyzed, and a deeper understanding of existing empirical outcomes in regard to the timing of the evacuation decision was achieved.

The Influence of Purchase Confidence on Information Source Selection: Implications for Hospitality Industry

Whether the product of choice is a restaurant, vacation resort or hotel, it is important for hospitality marketers to understand how consumers treat purchase decisions and the influence purchase confidence and situation play on that decision. This study investigated the role purchase confidence plays with knowledge in the selection of sources of information during purchase decisions. The results indicate sources of information are perceived differently by consumers and depending on the purchase situation, subjective knowledge is influenced by purchase confidence affecting the source of information considered when making a purchase decision. The results also indicated that those with high purchase confidence and subjective knowledge will rely on themselves as a source when making a purchase rather than a retail clerk or published material.

Essays in Environmental Economic Valuation and Decision Making in the Presence of an Environmental Disaster

The first essay developed a respondent model of Bayesian updating for a double-bound dichotomous choice (DB-DC) contingent valuation methodology. I demonstrated by way of data simulations that current DB-DC identifications of true willingness-to-pay (WTP) may often fail given this respondent Bayesian updating context. Further simulations demonstrated that a simple extension of current DB-DC identifications derived explicitly from the Bayesian updating behavioral model can correct for much of the WTP bias. Additional results provided caution to viewing respondents as acting strategically toward the second bid. Finally, an empirical application confirmed the simulation outcomes. The second essay applied a hedonic property value model to a unique water quality (WQ) dataset for a year-round, urban, and coastal housing market in South Florida, and found evidence that various WQ measures affect waterfront housing prices in this setting. However, the results indicated that this relationship is not consistent across any of the six particular WQ variables used, and is furthermore dependent upon the specific descriptive statistic employed to represent the WQ measure in the empirical analysis. These results continue to underscore the need to better understand both the WQ measure and its statistical form homebuyers use in making their purchase decision. The third essay addressed a limitation to existing hurricane evacuation modeling aspects by developing a dynamic model of hurricane evacuation behavior. A household’s evacuation decision was framed as an optimal stopping problem where every potential evacuation time period prior to the actual hurricane landfall, the household’s optimal choice is to either evacuate, or to wait one more time period for a revised hurricane forecast. A hypothetical two-period model of evacuation and a realistic multi-period model of evacuation that incorporates actual forecast and evacuation cost data for my designated Gulf of Mexico region were developed for the dynamic analysis. Results from the multi-period model were calibrated with existing evacuation timing data from a number of hurricanes. Given the calibrated dynamic framework, a number of policy questions that plausibly affect the timing of household evacuations were analyzed, and a deeper understanding of existing empirical outcomes in regard to the timing of the evacuation decision was achieved.