Do Consumers Really Make Rational Decisions Essay

Do Consumers Really Make Rational Decisions - Essay Example To be able to answer the question regarding the rationality of the choices made by the consumers, it is important to explore the issues related to the decision-making process of the consumers. There are different internal and external factors that can affect the choices of the consumers. The internal factors of a consumer include factors in his or her psychological core such as motivation, ability, and opportunity; exposure, attention, and perception; knowledge and understanding; attitude formation and change, memory and retrieval. These factors comprise the core values of a consumer which can affect the decisions that he or she makes. In addition to these factors, the external aspects or the consumer’s culture also contributes to the choices made. The external parameters are composed of the consumer diversity, the social class and household influences, the psychographics or the values, personality, and lifestyles, and the social influences. Through the interaction of the internal and external factors, the decision-making process can be completed.... The problem can be equated to the need of a consumer which can only be answered by a particular product or service. This need also dictates the possible outcome of the decision-making process. The needs of a consumer can be defined by the necessities of the daily existence (Mullen and Johnson, 1990, p. 91). One paradigm that presents the basis of a consumer’s needs is the Maslow’s hierarchy of needs which defines the consumer behavior as an effect of the human needs. The said needs then are considered as â€Å"underlying factor of consumption† which are classified into physiological and psychological needs. Physiological needs are for survival thus considered basic and found at the lowest level of hierarchy. This is followed by another physiological need which is the safety needs such as shelter and insurance. The next levels consecutively comprise the psychological needs such as belongingness and love needs; need for esteem; and self-actualization needs (Jansson -Boyd, 2009, p. 119). By tapping any of the said needs different companies and business can generate profits. Although this is one of the basic factors, the consumers’ needs are only considered as one of the many factors that contribute to the complicated web of interaction to come up with the client’s choice. Actual Process of Decision-Making It is important to consider that the said needs are the stimuli that can lead to the decision of the client to buy a particular product or avail a particular service offered. Once the need of the client had been recognized, it leads to the second level of the decision-making process which is deciding whether to buy a product or not. It is important to consider that the act