Pre‐purchase decision‐making for a complex service: retirement planning

Abstract

Purpose This purpose of this paper is to respond to calls for further research into consumer pre‐purchase decision‐making, and investigate the factors that cause a customer to make a decision to save for retirement. Design/methodology/approach Exploratory research using eight focus groups was undertaken in Sydney, Australia with a total of 55 participants. The data were analysed using the approach suggested by Cresswell and includes coding into chunks, development of themes, interpreting, and validating findings. Findings Three key findings emerged from the research. First, there are certain internal, external, and risk factors that have a major impact on propensity to save for retirement. These are: involvement level, motivation, needs and wants, family influence, marketer influence, competitive options, financial risk, functional risk, and psychological risk. Second, no clear and universal gender differences in the pre‐purchase decision‐making process emerged during the focus group discussions. Finally, alternative options for spending and addressing risk negatively influence pre‐purchase decision‐making and therefore the desire or ability to save. Research limitations/implications This study is constrained by its exploratory nature. Consequently, future research could utilise quantitative methodology to confirm findings and allow generalisation of results. Also, a study incorporating ethnicity would add breadth to the findings. Practical implications Managers and policy makers benefit from understanding that marriage and turning 40 years old are highly influential to a consumer's likelihood to save for their retirement. This information is particularly useful for the development of marketing and communication campaigns. Originality/value This is the first exploratory study of pre‐purchase decision‐making which researches the triggers for buying complex financial services associated with saving for retirement.

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