ADVERTISEMENT ROLE IN CONSUMER DECISION-MAKING PROCESS

INTRODUCTION

The advertisement is an important channel that each advertiser uses to communicate his product to consumers. A consumer is a person who has needs and wants to fulfill his basic needs and it can extend to other life luxury wants. Consumers are the target of advertisers every day through TVs, newspapers, radios, social media, etc.. Consumers are always annoyed¹ of the advertisement but if it was personalized and related to their current actual needs and wants, It would become a source of information for the consumer rather than an annoying source. That made advertisers study consumers' behavior. Advertisers started looking in each detail of consumers’ journey in buying a product or a service so they can be able to find when and how they should approach the consumers.

In this report, I will highlight what are the types of advertisement that an advertiser use from the rationality of the advertisement point of view. I will show what is the decision-making process of the consumer. Based on that, I will clarify how advertisers can approach consumers during the different phases of decision making based on rational and irrational advertisements. After that, I will give a brief about the future of advertisement in the near future and will end up with a conclusion about the general role of advertisement in a consumer's life.

CONSUMER DECISION-MAKING PROCESS

Studying consumers’ decision-making process² helps advertisers finding a way to approach those consumers and how to influence their decision-making process. Consumers pass by a process in their decision making as following:

1. Problem recognition
2. Information search
3. Evaluation of Alternative
4. Purchase
5. Post-purchase satisfaction or dissatisfaction

This process shows the behavior of a consumer while buying goods or services. Each of these stages reflects a different goal for the customer. I’ll illustrate each phase in detail later in the report.

ADVERTISEMENT RELATION WITH CONSUMER BEHAVIOR

Advertisement and consumer behavior have a strong relation. The role of advertisement is to influence the consumer decision-making process and influence consumer decisions in all stages based on the marketing and advertising goals.

Advertisers use different channels to reach consumers at different times. They can use social media, television, radio, newspaper or even any printed material to appeal to the consumers. Each channel can have a different effect on consumers' behavior based on the demographics and characteristics of the consumers. These different channels also have a different effect based on the consumer stage of decision making.

Advertisers also study consumers' behavior not only to reach them but also to get their feedback and their reactions toward the sold products. By understanding these reactions, advertisers will be able to create more effective advertising for later campaigns and better targeting and message to the consumer.

TYPES OF ADVERTISEMENT

There is a number of advertising approaches being used by advertisers based on the way they want to approach the consumer or potential consumers. The main goal of all of these approaches is to persuade potential customers to buy a product and convince the current customer of the value they got from the product they buy against other products. The advertisers also try through different approaches to convince their current customers to buy more products from them or renew a service contract. There is a common classification for advertisement which is Rational and Irrational advertisement. The rational type of advertisement is the one in which the advertisers rely more on product features while irrational advertising is more about the emotions and social effect of the products.

INFORMATIONAL ADVERTISING

The informational advertisement is one of the rational advertising approaches. The informational advertisement is a product-oriented advertisement. It focuses more on showing off the characteristics of a product. This approach presumes that customers know what they want to buy and can relate the characteristics of the advertised product to their needs and benefits.

TRANSFORMATIONAL ADVERTISING

Transformational advertising is considered irrational advertising. It focuses on the consumer more than the product. This form of advertisement tries to create a unique experience for each consumer by providing him with an advertisement that appeals to their needs and wants. Through transformational advertising, the advertisers try to show their users’ how their life can be better by buying a product or service. This type of advertisement also tries to link the experience a user would get by buying a product or a service with the experience of the brand name. An example of such an advertisement is when Nike or Apple launch new products in the market and the advertisers try to link the experience of the product with the brand name of Nike and Apple.

The irrational advertising techniques focus on the emotional side of people’s characters. With such an approach, they work more on the influential factors of the decision-making process of the user from a psychological aspect. Building trust using the brand name behind a product is one of the key factors in irrational advertising. That can also lead at the end to better sales and even the customer would buy the premium products of this brand because of the trust that was built with the company.

ADVERTISEMENT EFFECT ON CONSUMER BEHAVIOR

Advertisement always seeks behind influencing consumers and make them buy a product in the first place. Advertisers track consumers' behavior in order to be able to influence their decision-making process. That makes advertisers target each phase of consumer behavior decision making with a different approach. A consumer is looking for information, and an advertiser is a person who communicates all the required information to a consumer but for a specific product. Following, I’ll introduce the role of advertisement in each stage of the consumer decision-making process.

ADVERTISEMENT ROLE IN PROBLEM RECOGNITION

Problem Recognition phase of consumer decision making is the phase when the consumers realize their needs and look for satisfying these needs. The problem which creates the need and wants can be related to the human basic needs³ of food, water, shelter, clothing, sanitation, education, and healthcare. The problem usually realized by the consumer when they are dissatisfied by their current state in any of the basic needs. The problem can also be due to a seek of a higher level of satisfaction through a luxury wants.

Advertisers found that creating needs⁴ and wants is very useful especially with the innovative and new products in a market. An example of the advertisement in need and want creation is an advertisement role in transferring the concept of using a car as a way of transportation to be a better life need and a sign of social level. In this stage, the advertisers use both rational and irrational advertisements. The rational advertisement helps more in creating the needs of the advertised product while the irrational advertisement help more in creating the wants.

ADVERTISEMENT ROLE IN INFORMATION SEARCH

A consumer starts searching for information once a problem is perceived. The consumer’s goal in this phase is to find all the required information to help in solving his problem. In this phase, advertisers focus on rational advertising to help consumers understand how the advertised products are serving their problems. Consumers in this stage are confused because of the many choices they see and comparing them to reach the best choice isn’t an easy task. Advertisers target consumers through the informational advertisement to create a shortcut road to specific products. Advertisements can take place on TV, Radio, newspapers, any printed material or social media channels.

ADVERTISEMENT ROLE IN EVALUATING ALTERNATIVES

Evaluating alternatives and information search is like a continuous cycle stage in which a consumer keeps going forward and back between them before making the purchase decision. During evaluating alternatives phase of decision making, the consumer doesn’t only compare how a product is satisfying his need against⁵ other products. Consumers usually have some other factors that take part in the comparing process, like a brand name or how the product would contribute to consumer social prominence. The psychological factors are usually attacked by irrational advertising. Through the irrational advertising, an advertiser will be able to form different other values than the core real value of a product or a service. A Nike shoe can be just something that protects your leg and makes you walk comfortably or can be a shoe that makes you look stylish in people’s eyes. The previous example is showing the difference between the core value of a product and the irrational advertisement that a consumer can receive. The order winner in this phase is the advertiser who will manage to make his product to be superior over all the other products in the market. An advertiser role isn’t only to show that his product is superior but also to convert all negative associations to a product to be a positive point. The advertiser should work on decreasing the uncertainty⁶ that a consumer has toward a specific product. That all makes transformational advertising plays an important role in the evaluation of alternatives stage.

ADVERTISEMENT ROLE IN PURCHASE DECISION

In the decision-making phase, a consumer shall have a well-defined idea about what exactly the product he wants to buy. This stage can be interrupted if the consumer received negative feedback through social media or a friend who has experience with such a product. Advertisers focus on this stage more on rational advertising to bring the core value on the table to persuade and influence the consumer purchase decision. They can also use the irrational advertisement here to make the wants have a higher power over the needs. Both transformational and informational advertisements can be utilized in this stage based on the message that the advertiser wants to deliver.

ADVERTISEMENT ROLE IN POST PURCHASE

Post-purchase advertisement aims to build a relation and loyalty between a customer and a company. This advertisement can be just for promoting new relevant products, showing more information about a sold product to the consumer, or providing product care to the consumer. The advertisement role in this stage is also to collect feedback about a sold product and build a better communication channel, targeting message and customer experience. Informational advertising can be utilized in this stage to help in promoting new products or customer service. The transformational advertising can help in keeping the consumers loyal for a longer time to the product they bought and appeal them more to it.

THE FUTURE OF ADVERTISEMENT: ONLINE FIRST

Online advertisement⁷ first isn’t a myth anymore. During Adobe Think Tank Panel⁸ discussion at advertising week 2017, Phil Gaughran, U.S. chief integration officer of agency McGarryBowen made predictions about the future of advertisement. He predicted that by 2022, 80% of the advertisement will be automated while the rest 20% will represent the Brand value, storytelling, and the experimental tactics that the advertisers will use.

How that can be related to consumers is the key question that needs to be answered. Nowadays, consumers can buy everything on the internet. That enabled advertisers to follow consumers' behavior, monitor it and record it. That makes the prediction of Phil Gaughran more realistic and achievable.

Such automation for advertisement will require much information about consumers, which will probably also lead to a more personalized advertisement. That would increase advertisement quality. According to Rocket Fuel’s Consumer Perceptions of AI⁹ Survey, as the volume of products and services provided online increases, more data also provided by users to the products and services provided. That means more understanding for the consumers and more understanding of their behavior which will lead also to a more personalized advertisement in the future.

CONCLUSION

Advertisement plays an important role in influencing consumers' decision making. It takes place in each stage of the consumer's purchase decision, it can even create the needs and wants of the consumers. In the IT industry, you will find many advertisements for new tools, software, or even hardware technology that is creating new needs for you. With such new needs, consumers are having more reasons to consume more than before. The advertisement which is based on the main two types: rational and irrational are having a psychological effect on people’s decisions. Nowadays, Google which is the second largest company¹⁰ in terms of value has advertisement as the main revenue stream. That shows how advertisement became an important tool for any business to influence consumers and make them buy new products. That also shows how the advertisement is taking big steps toward digital media with more autonomy than ever before.

Advertisement plays a great role in the post-purchase phase since it tries to increase the retention rate of the consumer toward a specific brand or product. That makes the goal of advertising a little bit different in the middle three stages than the first and the last stages. The advertisement goal during the three middle stages is to influence the consumer decides to go for a specific product to satisfy his current need or want. However, the advertisement goal in the first stage is to create needs and wants. While the advertisement in the last stage is more related to be in touch always with the customer with new products or services.

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