The Hindu Business Line : Decisions, decisions!

Decision-making in the consumer durables sector is a topical aspect in marketing, given the advertising clutter and proliferation of brands and frequent updated offerings from various brands (mobiles, for example).

Extensive decision-making involves in-depth and focused search (product category) and the consumer spends a lot of time and energy in searching for this type of information. Though what is extensive search can vary from one segment to another, typical ly buying a durable like a television set or computer or an expensive camera requires a high degree of effort in the search process.

Comparison of features, prices and brands (both features and quality/reputation inferences) are common in this type of search. Brands that are new need to create awareness, and established brands need to highlight how they are better than the other brands. This is the reason why innovation (in durables) is required by leading and pioneering brands. Without such an approach, the leaders will lose their leading edge. New brands like to impress upon consumers how their offerings are different from market leaders. Such an approach has provided the Korean brands major success in the Indian context across product categories; and in the process, established brands have fallen by the wayside. Some of them are trying to come back with new product categories in their portfolio.

In the information stage, the strategy of the pioneers/leaders and that of the followers have an impact on consumers, especially in high-involvement products. Consumers seem to gravitate towards brands that exhibit a high degree of marketing orientation in terms of consumer needs after they have established themselves. ‘Information seeking effect’ normally starts with well-known brands (to the respective consumer) and the examination of brands that are new to the market. Sources of information may be retail outlets, friends and advertisements, to mention a few. For example, Santro was virtually unknown to the Indian market when it was introduced.

In their ‘consideration’

As more and more consumers buy a new brand, more number of consumers become interested in the brand and the brand gets into their ‘consideration set.’ This is the start of a brand being considered for the final purchase. LG and Samsung are relatively new brands in India in several categories. Consumers are likely to include them in their consideration set whenever they shop for that product category. If leading brands of the Nineties were those in categories such as television, air-conditioners, washing machines and refrigerators, they have not been able to hold their dominance in the respective category.

Brand building in such categories requires constant customer-focused variants (if not innovations) and building brand associations too. LG and Samsung are brands that entered the context late but have made significant progress in many of these categories. LG’s ‘pure air’ (not just cool air in air-conditioners) and Samsung’s ‘extra-space viewing’ are examples to show how brands make progress with regard to customer-focused attributes. Titan too has transformed customer perception of branded watches in India with its brand associations, retailing experience and variety. LG introduced its feature packed mobiles with the sub brand ‘Dynamite.’

In today’s digital and changing lifestyle, information search too has assumed a different route, at least in the high-involvement and extensive decision-making process of consumers. While advertisements continue to attract consumers both for their entertainment and information value, marketers need to remember that word-of-mouth is becoming very important.

Though word-of-mouth is traditionally associated with how one consumer passes on information about a brand to another, marketer-induced word-of-mouth is becoming the order of the day, at least in some markets. Leading global companies have models using latest product introduction cellular phones in upmarket hotels so that prospective consumers hopefully notice the mobiles and start enquiring about them.

Web sites too are places where marketers can create excitement through word-of-mouth. A leading singer’s latest album was discussed on the Web and this attracted several consumers to buy the recordings. On the flip side, marketers need to be careful about the negative word-of-mouth created by cyberspace. There are several Web sites that convey messages against leading brands. There are also some that carry the opinions of customers on specific brands (mouthshut.com).This is one the reasons companies create Web sites for their brands to provide information on brands (for example, Sony’s Web site).

Word-of-mouth can also be obtained face-to face. This not only happens for extensive decision-making relevant to durables but also for services that trigger perceived risk among consumers. This can happen to services provided by a salon (both genders included these days) and also about the dental services provided by a doctor (the legendary fear of the dental chair continues to this day even with latest equipment; no medicine to this day has been discovered for the fear of pain). Consumers use word-of-mouth in their work place, neighbourhood and in leisure communities (clubs and other informal gatherings). Information gathering can be done at two sources - one from WOM and the other from retail outlets. This is the reason why retail outlet traffic is important both for established and new brands.

The important part in the information phase of consumer decision-making is that the consumer has a choice set from which he/she makes the final choice. The consumer may compare features, prices and retail outlets in extensive decision-making or pick up from the choice set for variety- /price-related/enhanced offering. Consumers look for information until a ‘choice set’ is formed for the respective durable category.

Comparisons!

The next stage in the consumer decision-making stage is the ‘comparison of alternatives’ stage. The consumer compares the brands in the ‘choice set’ and comes to the final choice of the offering/brand. The consumers may either compare just the price of the offering or rank the features/benefits and compare the various brands. This is one phase where companies in the durables categories have a lot of scope to introduce comparative advertisements. The company/brand doing this has to ensure that the offering is distinctively superior to the competitive brands as otherwise the comparison may even provide better mileage to competitive brands! HCL copiers, decades ago, introduced an ad comparing the product with Modi Xerox. TVS Suzuki during the same period introduced one comparing itself with Hero Honda. A few years ago, Santro did a fine job of comparing itself with other models competing against it, after creating good awareness about its brand (in a market like India where the brand was unknown).

The distinguishing aspect of this stage (in the case of durables) is that the consumer, after experiencing the need, can be ‘quickly’ brought to this stage . A well thought-out communication strategy and good product offerings are prerequisites for such a strategy. A conceptual process towards durable categories can provide an objective touch to creative advertising.

(The writer is Professor of Marketing, Indian Institute of Management, Bangalore.)