K RAJENDRAN AND J JAYAKRISHNAN: CONSUMER PERCEIVE D RISK IN CAR PURCHASE
DOI: 10.21917/ijms.2018.0100
736
CONSUMER PERCEIVED RISK IN CAR PURCHASE
K. Rajendran1 and J. Jayakrishnan2
1Department of Management Studies, E.S. Engineering College, India
2Department of Business Administration, Annamalai University, India
Abstract
This paper presents a study on consumer perceived risk towards their
purchase decision to buy automobiles in India, having knowledge of
various aspects of consumer buying process can help companies
significantly when developing strategies to increase their market share,
while relying on two mechanism: enhancing the customer satisfaction
or reducing the customer perceived risk and also this paper aims to
develop the empirically test a conceptual model of consumer perceived
risk for car purchase. It mentions results from regression analysis
which revealed positive link between the said factors with purchase
decision. It also provides a platform for automobile manufactures to
understand consumer behaviour and it is impact on their decision to
purchase.
Keywords:
Consumer Behaviour, Perceived Risk, Automobile, Purchase Decision
and Model of Consumer Behaviour
1. INTRODUCTION
Consumer behaviour is study with the individuals, groups or
organizations and they use to select and dispose the services,
products and experience or ideas to satisfy their needs and impacts
of process in the consumers and society. The consumer behaviour
consist elements are psychological, sociology, social
anthropology, economics and marketing. It understand the
decision making process of buyers or customers, both group and
individually in analyse the emotion affect consumer behaviour. In
this studies explain the characteristics of individual customers
such as demographic variables in try to understand the consumer’s
needs. It also try to analyses the influences of consumers group
such as friends, family, reference groups, sports and society.
Consumer behaviour is the activities people undertake when
obtaining, consuming and disposing of products and services [1].
The importance of understanding consumer buying behaviour
and the ways how the how the customer choice their products and
services can be extremely important for manufactures as well as
service providers as this provides them with competitive
advantage over its competitor in several aspects. For example,
they may use the knowledge obtained through studying the
consumer buying behaviour to set their strategies towards offering
the right products and service to the right audience of reflecting
their needs and wants effectively [2].
1.1 CONSUMER DECISION MAKING
A decision making is the selection of an option from two or
more alternative choices. A person while make a decision to have
a choice of alternatives must be available, When a person has to
select the choice between purchase a product and not purchase a
product, the choice between product or brand A and B, that person
is in a position to take a decision, If the consumer has no
alternative choices from which to choose and is little bit forced to
select a particular product purchase or services, then this single
there was no-choice instance does not constitute a decision, such
a no-choice decision is commonly referred to as a Hobson’s
choice [3].
According to Koran a purchase decision included the risk
when the consequence connected with the decision is uncertain
and some result is more desirable than. The consumer decision
making process model is represented in three major components
Input, Process and Output [4]
1.2 PERCEIVED RISK
Schiffman and Karuk [12] Stated that Consumers have a
number of enduring perceptions or images that are is particularly
relevant to the study of consumer behaviour [11]. Product and
brand have symbolic value for individuals who evaluate them on
the basis of their congruence with their personal pictures of
themselves. Consumers attempt to preserve or enhance their self-
images by buying products and patronizing service that they
believe congruent with their self-images and by avoiding those
that are not [5].
Perceived risk usually plays an impotent role in the purchase
decision making process regardless of the nature of the purchase
occasion (planned vs. impulse). Every purchase contains some
degree of risk [6].
1.3 THE IMPACT OF PERCEIVED RISK
In a purchase decision the customers tries to recognize their
buying goals and they equalize these goals with product offerings.
Perceived risk can be attributed to any one or a combination of
the certain factors [7].
For example, consumer may be uncertain as to what their
buying goals are. Failure to identify buying goals may be the effect
of uncertainty about, the nature of goals, goal acceptance level or
level of aspiration, the relative importance of achieving the goal,
current degree of goal attainment that is consumer may vary in
their certainty concerning the extent of the difference between their
current state and their desired goal acceptance level [8].
The consumer may be uncertain as to which purchase (Place,
Product, Brand, model, Style, Size, Color, etc.) will best match or
satisfy acceptance level of buying goals. The customer may
perceive possible adverse consequences if the purchase is made
and the result is a failure to satisfy the buying goals [9].
1.4 CIRCUMSTANCE THAT ACCENTUATE
PERCEIVED RISK
Perceived risk [10] can be associated with any product or
service, but it tends to be higher in the following circumstance:
• Little information is available about the offering.
