Influence of life events on consumer decision making: financial services and mature aged consumers in Australia

Milner, T 2011, Influence of life events on consumer decision making: financial services and mature aged consumers in Australia, Doctor of Philosophy (PhD), Media and Communication, RMIT University.


Document type: Thesis
Collection: Theses

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Title Influence of life events on consumer decision making: financial services and mature aged consumers in Australia
Author(s) Milner, T
Year 2011
Abstract The purpose of this exploratory study is to investigate the influence of probable life-events on the decision making processes of mature aged consumers with regard to financial services. In the Australian context financial services are becoming an increasingly important issue as more responsibility for retirement planning is being transferred to the individual. A consumer behaviour perspective frames the analysis so that policy makers and marketers can communicate more effectively and efficiently with consumers to produce more desirable outcomes.

Sociology and Psychology scholars have shown significant occurrences (life-events) change behaviour. Consumer studies have linked life-events and changed consumer behaviour, particularly brand and patronage preferences. However, a gap in the body of knowledge exists regarding how life-events influence purchase. Therefore this study aims to identify elements linking life-events and purchase of financial services.

If life-events influence consumer behaviour it follows that the consumer decision making processes may also be altered by life-events. The consumer decision making framework used for this study is based on four processes: need arousal, information search, criteria development and evaluation of alternatives. Having found little research concerning Need Arousal, this study identified four Need Arousal categories using probable life-events. The categories were used to frame the differences for the other processes in consumer decision making.

The methodological approach involved three phases. The initial qualitative phase identified financially significant experienced and expected life-events and the decision making process of mature aged consumers (40 - 70 years old). Twenty-five face-to- face, semi-structured in-depth interviews with mature consumers (n=12) and relevant practitioners (n=13) including financial planners, marketing communicators, advertisers and an actuary provided a list of 25 common mature life-events.

Phase two involved the design of a survey questionnaire based on the results of the qualitative information. Reliability and validity testing involved consulting with industry experts (n=10), interviewing mature consumers (n=7) and pre-testing the questionnaire (n=25). Twenty-five financial life events form the basis of the questionnaire with the remainder investigating decision making for financial services.

Phase three was the distribution and analysis of the survey questionnaire. A stratified random sampling technique (by state) was used to select mature consumers from an Australian health insurer. Data were entered into SPSS from 776 completed questionnaires. Initial tests found that life-event scales were bimodal, invalidating the assumption of a normal distribution, thus nonparametric techniques were used for further analysis.

The results of the analysis produced a ranked order of the 25 life-events assumed most likely to occur to mature consumers. More importantly, a ranked order of the 25 life-events most likely to arouse purchase intention for financial services was found. Statistically significant results were obtained for 22 of the studied life-events, supporting prior research regarding life-events influence on consumer behaviour.

To answer the research question of how life-events influence consumer decision making one perceived life-event, retirement, provided a focal point. The sample was separated into two types based on assumed behaviour: those likely to retire imminently and those not likely to retire imminently. The assumed purchase behaviours for each type was analysed in relation to the developed needs arousal hierarchy: latent need, recognised need, activated need and met need. Most need arousal categories showed the expected consumer behaviours in line with the need arousal categories. Imminent retirement would imply a reasonable expectation that mature consumers moved along the needs hierarchy towards activation, however this was not always the case. Significant percentages of each of the latent and recognised need categories do not perceive that they would activate purchasing behaviour. This finding is problematic because of the social difficulties of providing financially for individuals in their retirement. The findings further articulate actionable communication avenues to address the problem for policy makers and marketers by helping them identify the differences between consumers based on the process of the arousal of needs.
Degree Doctor of Philosophy (PhD)
Institution RMIT University
School, Department or Centre Media and Communication
Keyword(s) Consumer Decision Making
Consumer Behaviour
Need Arousal
Life Events
Situational Influences on Decision Making
Non-Parametric Statistics
Financial Services Decision Making
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Created: Thu, 12 Jan 2012, 16:06:01 EST by Guy Aron
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