Family Decision Making

Published by MBA Skool Team, Last Updated: August 19, 2018

What is Family Decision Making?

Family decision making is a concept in marketing & consumer behaviour where an individual decides to buy a certain product or service after deciding it along with his or her family. Family decision making is a collective decision by the family, even if the individual is going to buy the product or service entirely with his/her own money.

Every individual has his/her own taste of buying and consumption. This pattern is largely inherited by the family or the people surrounding the individual. The buying behaviour of the individual depends a lot on age, gender, location, income and willingness to spend. The family members which comprise of parents, siblings, grandparents and relatives play a very important role in deciding what to buy and what not to buy. The person generally discuss with the family members before buying any product which largely influence his/her decision. Most of the economists have ignored the family decision making in their theories and concept which actually plays a huge role in demand of goods and services especially in country like India. For Ex- A bachelor guy may freely spend money on spirits & beverages, attending late night parties at bars and gadgets but once he gets married, his buying pattern changes. He is more interested in buying mutual funds, insurance or house. If there is a child, more money is spent on toys, nutritious food and education. Similarly, a wife/mother can also buy a men shirt or perfume for his husband or son which she could not have done as a single lady.

Individual members perform different roles in a family which ultimately leads to a unique buying tendency of the family as a whole. The roles are:

Information Gatherers – These are the individual who share information about the product of relevance among the family members. These people have great power as they can selectively transfer information which they favour and discard any information which are not liked by them, thus playing a crucial role in family decision making.

Influencers - These people do not have the power to buy things but they have a great power to influence the decision. For Ex- Children in family can really influence the decision for which movie to watch in movie theatre.

Decision Maker – The decision maker has the power to decide whether to buy or not, what to buy, when to buy, where to buy, etc.

Purchaser – The purchase is the one which actually purchase the items following the orders to decision maker. But it can also decide the product in case of unavailability of product or may/may not buy according to his/her will.

This article has been researched & authored by the Business Concepts Team. It has been reviewed & published by the MBA Skool Team. The content on MBA Skool has been created for educational & academic purpose only.

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