ppt chapter 6

Principles of MarketingMKT3010

Chapter 6Consumer Behavior

Patricia Knowles, Ph.D.

Associate ProfessorClemson University

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Consumer BehaviorThese are the learning objectives guiding the chapter and will be explored in more detail in the following slides.

Articulate the steps in the consumer buying process.

Describe the difference between functional and psychological needs.

Describe factors that affect information search.

Discuss post-purchase outcomes.

List the factors that affect the consumer decision process.

Describe how involvement influences the consumer decision process.

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The Consumer Decision ProcessThis slide illustrates the entire consumer decision process. This model represents the steps that consumers go through before, during, and after making purchasing decisions.

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Post purchasePurchaseAlternative evaluation

Information search

Need recognition

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Need Recognition

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The consumer decision process begins when consumers recognize they have an unsatisfied need. Consumer needs can be functional, which pertain to the performance of a product or service or consumer needs can be psychological, which pertain to the personal gratification consumers associate with a product or service.

Functional Needs

Psychological NeedsRoya

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Search for InformationAfter a consumer recognizes a need, he or she must search for information about the various options that exist to satisfy that need. In an internal search for information, the buyer examines his or her own memory and knowledge about the product or service. In an external search for information, the buyer seeks information outside his or her personal knowledge base to help make the buying decision.

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Internal Search for Information

External Search for Information

Courtesy of Refinery29.com.

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Factors Affecting Consumers’ Search ProcessOne important factor that affects consumers’ search process is perceived benefits versus perceived costs. Is it worth the time and effort to search for information about a product or service?

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PerceivedBenefits

PerceivedCosts

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The Locus of Control

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Another factor affecting the consumer search process is locus of control. Locus of control actually indicates how much control people think they have over the outcomes of various activities, such as purchasing a product or service. Some people sense their own internal control, whereas others feel virtually powerless. The former engage in more search activities.

Internal Locus of Control = more search activities

External Locus of Control = Fate, external factors

Royalty-Free/CORBIS©Comstock/JupiterImages

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Actual or Perceived RiskThere are three types of risk associated with purchase decisions that can delay or discourage a purchase.

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Psychological risks are those risks associated with the way people will feel if the product or service does not convey the right image.

Performance risk

Financial risk

Social riskPhysiological risk

Psychological risks

Performance risk involves the perceived danger inherent in a poorly performing product or service.

Financial risk is associated with a monetary outlay and includes the initial cost of the purchase, as well as the costs of using the item or service.

Social risk involves the fears that consumers suffer when they worry others might not regard their purchases positively.

Physiological (or safety) risk refers to the fear of an actual harm should the product not perform properly.

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Evaluation of Alternatives: Attribute SetsResearch has shown that a consumer’s mind organizes and categorizes alternatives to aid his or her decision-making process.

Universal sets include all possible choices for a product category.

A subset of the universal set is the retrieval set, which are those brands or stores that can be readily brought forth from memory.

Another is an evoked set, which comprises the alternative brands or stores that the consumer states he or she would consider when making a purchase decision.

Universal

Retrieval

Evoked

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Evaluation of Alternatives: Evaluate Criteria Evaluative criteria consist of a set of important attributes about a particular product. Determinant attributes are product or service features that are important to the buyer and on which competing brands or stores are perceived to differ. The students will respond to the question on this slide with weather, beach, friends, price, outdoor activities.

Evaluative Criteria

Determinant Attributes

What are some of the features of a vacation that would be in your evaluative criteria?

Digital Vision/Getty Images

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Purchase and Consumption

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Retailers use the conversion rate to measure how well they convert purchase intentions into actual purchases.

Increase Conversion rate

Reduce real or virtual abandoned carts

Merchandise in stock

Reduce the actual wait time

Handout/MCT/Newscom.

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Post-PurchaseMarketers can take several steps to ensure post-purchase satisfaction such as demonstrating correct product use, building realistic expectations, providing a money back guarantee, encouraging feedback, and periodically making contact with customers.

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Loyal customers will buy only certain brands and shop at certain stores, and they include no other firms in their evoked set.

Customer Satisfaction

DissonanceCustomer Loyalty

Post-purchase dissonance, also known as buyer’s remorse, is the psychologically uncomfortable state produced by an inconsistency between beliefs and behaviors that in turn evokes a motivation to reduce the dissonance.

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Check Yourself

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1. Name the five stages in the consumer decision process.

2. What is the difference between a need and a want?

3. Distinguish between functional and psychological needs.

4. What are the various types of perceived risk?

5. What are the differences between compensatory and non-compensatory decision rules?

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Factors Influencing the Consumer Decision Process

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• Product• Price• Place• Promotion

Marketing mix

• Motives• Attitudes• Perceptions• Learning• Lifestyle

Psychological factors

• Purchase situation• Shopping situation• Temporal state

Situational factors

• Family• Reference groups• Culture

Social factors

ConsumerDecisionProcess

This slide lists the factors influencing the consumer decision process, which are discussed in more detail in the following slides.

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Check Yourself

Principles of MarketingMKT3010

1. What are the types of needs suggested by Maslow’s Hierarchy of Needs?

2. Which social factors likely have the most influence on (a) the purchase of a new outfit for a job interview and (b) the choice of a college to attend?

3. List some of the tactics stores can use to influence consumers’ decision processes.

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Involvement and Consumer Buying Decisions

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High involvement Low involvement

Message (e.g., Ad)

• Greater attention• Deeper processing

• Less attention• Peripheral processing

Developsstrong

attitudesand purchase

intentions

Generates weak

attitudes andincreased use

of cues

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Types of Buying Decisions

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Many people will mostly likely identify the orange juice as habitual, Subway as limited, and the car as extended problem solving.

• Extended Problem Solving• Limited Problem Solving

– Impulse Buying– Habitual Decision Making

Courtesy Wendy’s International, Inc.

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Check Yourself

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1. How do low versus high involvement consumers process information in an advertisement?

2. What is the difference between extended versus limited problem solving?

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Glossary

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Attitude is a person’s enduring evaluation of his or her feelings about and behavioral tendencies toward an object or idea.

Consumer decision rules are the set of criteria that consumers use consciously or subconsciously to quickly and efficiently select from among several alternatives.

Determinant attributes are product or service features that are important to the buyer and on which competing brands or stores are perceived to differ.

Evaluative criteria consist of a set of salient, or important, attributes about a particular product.

Evoked set comprises the alternative brands or stores that the consumer states he or she would consider when making a purchase decision.

Extended problem solving occurs during a purchase decision that calls for a lot of effort and time.

Functional needs pertain to the performance of a product or service.

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Glossary

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Habitual decision making describes a purchase decision process in which consumers engage little conscious effort.

Impulse buying is a buying decision made by customers on the spot when they see the merchandise.

Involvement is the consumer’s degree of interest in the product or service.

Limited problem solving occurs during a purchase decision that calls for, at most, a moderate amount of effort and time.

Perception is the process by which we select, organize, and interpret information to form a meaningful picture of the world.

Psychological needs pertain to the personal gratification consumers associate with a product and/or service.

Retrieval sets are the brands or stores that can be readily brought forth from memory.

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Glossary

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Ritual consumption is a pattern of behaviors tied to life events that affect what and how we consume.

Shopping goods/services are products or services for which consumers will spend time comparing alternatives.

Situational factors are factors specific to the situation.

Specialty goods/services are products or services toward which the customer shows a strong preference and for which he or she will expend considerable effort to search for the best suppliers.

Universal sets include all possible choices for a product category.