Compare and contrast the different models of consumer decision-making, using a purchase/s of your choice.

Schiffman et al (2011) describes four different models for consumer decision-making:

The first is the Economic Model. In this model, the consumer is characterised as a rational decision maker, assuming they aware of all alternate options, and every feature and benefit of each option. This allows them to make a completely informed and rational purchase decision. For example, say a consumer wants to buy a flight from Melbourne to Sydney. The economic model suggest the consumer will compare Qantas, Virgin, Jetstar and Tiger, understand each airline’s full list of features, inclusions, price, service levels, travel schedule, and so on, and use this information to make a completely rational purchase decision. What this model doesn’t take in to account, is that people’s decision are often impacted by their own personal differences, for example their existing skills, habits and reflexes, their existing value and goals, and their extent of knowledge (Schiffman, 2011).

The second model is the Passive Model. This model assumes that consumers are completely manipulated by marketing, and decisions are impulsive and irrational. This model is the opposite of the economic model. Using the same example as above, the customer who wants to book a flight to Sydney may see an online advertisement for Virgin to Sydney for $199, and proceed and book that option right away. The model assumes the consumer plays no role in the decision making process, and is completely swayed by the offering of marketers. This model is criticised because although this may happen with low involvement purchases, most of the time, consumers will go to some level of effort to seek out alternatives in their decision making process.

The third model is the Cognitive Model. This model views consumers as information processors who seek and evaluate information, leading them to their purchase decision. Consumers may also use a “preference formation strategy” meaning they will allow another trusted person to establish preferences for them, like a friend or expert on the topic. These consumers are between the passive and economic models, seeking out just enough information so they feel there are sufficiently informed of their options. When booking the same flight from Melbourne to Sydney, this consumer might go in to the travel agent, learn a little bit about the options available so they feel like they are satisfactorily informed, and