The Analysis of “All Consumption is Rational with Buying Decisions Based on Logic”

Abstract

This report aims to study the role of rational and irrational factors in consumer behaviours, and through a case study of Merlin, the specific explanation is boundedly rational consumers. In the first part, the literature research is carried out on the decision-making process and key factors. It illustrates the rational and emotional factors of consumer behaviour theory from various cases, briefly outlines the Merlin pricing strategy and pays special attention to the decoy effect. Through the case analysis, it reckoned that most of the consumers are boundedly rational consumers due to self-limitation and external barriers. Besides, the analysis of rational factors focuses on the impact of information attributes and consumer characteristics, divided into objective and subjective perspectives. In terms of culture, the theory of reasoned action explained the relation between consumer's attitude and their behaviours. Additionally, common determinants of successful implementation are listed and explained in the case study of Merlin. The report's conclusions are based on research and case studies to summarize limitations and futural development.

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