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<p>Contents 3.1 Objectives 3.2 Introduction 3.3 Culture and sub-cultures 3.4 Social groups 3.5 Family and opinion leadership 3.6 Personality and self-concept 3.7 Motivation and involvement 3.8 Information processing 3.9 Learning and memory 3.10 Memory 3.11 Attitudes 3.12 Problem recognition, search, and evaluation 3.13 Purchasing and post-purchase behaviour 3.14 Organizational buyer behaviour 3.15 Summary Discussion questions Further reading3.1 Objectives</p> <p>72 72 72 75 76 81 85 88 92 95 97 102 108 113 116 117 117</p> <p>By the end of this chapter you should understand: (a) how customers purchase; (b) how customers evaluate, acquire, use or dispose of products; (c) the physical behaviour of customersthe overt act of buying; (d) The buying decision process: the mental activities pre and post purchase.3.2 Introduction</p> <p>Consumer and organizational buying behaviour may be defined as: The environment and decision process affecting individuals and groups when evaluating, acquiring, using or disposing of goods, services or ideas. In both consumer and organizational buying contexts there are a plethora of different environment and decision related variables that can impact on the decision of whether or not to initiate a purchase (Loudon and Della Bitta, 1993). In this chapter we consider each in turn and discuss the specific marketing implications. Before moving on, however, it is important to recognize the importance of a detailed understanding of buying behaviour since it can help delineate: market opportunities; target market selection; productsize, shape, features, and packaging; priceinitial price, discounts, awareness and sensitivity to price; appropriate promotion messages. 3.3 Culture and sub-cultures</p> <p>Culture is defined as the beliefs, attitudes, goals, and values held by most people in a society. However, the content of a culture also includes the physical and social environment (Quelch and Hoff, 1986). Sub-cultures contain distinctive groups of people within the culture that share common cultural meanings (Herbig, Koehler, and Day, 1993; Schaninger, Bourgeois, and Buss, 1985).3.3.1 Patterns of beliefs and behaviour</p> <p>A large and important part of any culture is the set of knowledge, meanings, and beliefs that are shared by a group, including symbolic meanings. Characteristic patterns of behaviour are also part of culture, such as drinking wine with meals, or not drinking any alcohol at all, or taking afternoon siestas, or working a nine to five day.3.3.2 Physical environment and social institutions</p> <p>Another aspect of culture includes the physical objects and social institutions constructed by a society and the meanings that these have for most people. Examples would be dominant architectural styles, sizes of homes and configurations, traffic laws, art, household artefacts, and products.3.3.3 Cultural change</p> <p>Charge It was the slogan for many consumers in the 1980s. Average real disposable incomes only rose by a few per cent, but the credit boom fuelled consumer spending and personal debt mushroomed (as did corporate debt). The 1990s proved to be a watershed era replacing consumer concerns for prestige with value and prudence which has continued into the turn of the century. There are underlying demographic and attitudinal changes going on:Upscale is out and downscale is in. Flaunting money is frowned upon: if you have itkeep it to yourself or give it away! In place of materialism people are spending more time with family and friends, rest, recreation and good deeds. People have been awakened to many personal issues such as the plight of a homeless neighbour or the loss of a job. Middle-aged baby boomers now have older families and more financial responsibilities. People are not pessimistic, just realistic about job opportunities and income growth. There is a general trend towards recycling, environmentalism, and spirituality. 3.3.4 Specific applications</p> <p>(a) Values</p> <p>There is a wide body of research and analytical approaches attempting to link values and consumer behaviour. Various studies have linked values of ownership and household appliances, recreational activities, giving to charities, media usage, etc. Examples include the Rokeach Value Survey (RVS) which uses 18 instrumental and 18 terminal values and the University of Michigan's list of Values (LOV). SRI International has combined value and lifestyle (VALS and, more recently, VALS 2) identifying eight categories of consumers based on their value orientation and available resources (Novak and MacEvoy, 1990):</p> <p>The argument is that consumer behaviour will be modified to a lesser or greater extent depending on the category into which an individual falls.(b) Multinational business</p> <p>Marketers operating abroad need to have a good understanding of crosscultural differences. The kinds of issues focused upon in research include: M-Time (monochronic) where punctuality is desired and P-Time (polychronic) where time is more loosely defined; low-context communication, where everything is explicit and high-context where verbal and non-verbal dominate; customs and standards; degree of competitiveness and individuality.</p> <p>(c) Sub-cultures</p> <p>Sub-cultures are large groups or segments of people who share common values, goals, beliefs, attitudes, norms, and behaviour patterns. Individuals may belong to several sub-cultures at the same time. Typically they are defined by: race: nationality; religion; location.</p> <p>Direct marketers often target sub-cultures because they have distinguishable purchasing patterns; they may be large in spending terms and are often concentrated in identifiable locations.3.3.5 Examples of culture and buying behaviour</p> <p>Society's concerns over health and personal responsibility have hit the alcohol industry over the past ten years. Hard alcohol consumption has declined steadily in face of a shift to lighter beverages, bottled water, and soda. Increasingly pro-active views of health have led to a boom in sales of sportswear and equipment. Cocooning and home values are rising trends that have affected all mass outdoor entertainment industries and benefited take-home drinks and food and home entertainment. Greater emphasis on stress reduction has led to an increased focus on relaxing and travel. Marlboro re-positioned itself from a feminine cigarette in the 1950s to a rugged masculine one in the 1960s through the use of cultural symbolism. People generally dress according to cultural norms and expectations, such as for work or going out for an informal party. Price haggling may be an important cultural ritual. North American commercials tend to have a hard-sell focus compared to British ones. Coca-Cola sells mainly as a mixer in Spain. 3.4 Social groups</p> <p>Social groups may be classified as either primary or secondary. A primary group would be your family and friends. A secondary group would be your doctor, work colleague, or teacher. Groups can assign status to individuals according to an ascribed position. The position will normally have rights and obligations. Groups to regulate behaviour apply norms. People are allocated roles in groups and these roles are dynamic. New group members normally have to go through a period of formal or informal socialization. Groups have the power to control their members' behaviour by rewards, coercion, legal rights, or expertise. 3.4.1 Reference group behaviour</p> <p>Other members within groups are known to affect the behaviour of members. This is known as reference-group influence. Reference group buying influence is strong because people find other members of their group credible and because purchases enhance group acceptance.3.4.2 Issues</p> <p>The nature of the product category and the brand concerned are important factors in reference-group influence. People do not phone their parents to ascertain whether or not to buy a bar of chocolate. On the whole, group product symbols or high-risk products (e.g. cars) are subject to the greatest reference-group influence. There will also be variability in influence depending on the nature of the group and the individual concerned (e.g. their strength of character).3.4.3 Direct marketing and reference groups</p> <p>One of the key issues in reference group influence relates to direct marketing strategies. It is difficult for direct marketers to know which celebrities to use as influencers and whether it would be better to use ordinary members of the representative group instead. The trend in the 90s has been to move away from celebrities whose image may turn sour (e.g. Michael Jackson). In addition, people have tired of the 80s celebrity emulation and are returning to more home-spun simple values in all kinds of groups.3.4.4 Examples of groups and buying behaviour</p> <p>Cars are the quintessential product representing social class. Mercedes, BMW, Jaguar, Volvo, Honda, Audi, Toyota, Renault, Vauxhall, and Ford all have different symbols. People throughout social classes use furniture, but brands have developed narrow social class targets with different styles and price levels. These range from museum level antiques, to designer furniture, regular antiques, popular brands, self, assembly, and used furniture shops. Levi-Strauss experienced significant drops in profitability from the mid-1980s onwards owing to the decline in the teenage market. By contrast, personal savings have risen owing to the growth in proportion of older people.</p> <p>Generation X has rejected many of the values of the baby boomers and has defined a new value system of work and almost 60s culture. The economy and the threat of AIDS have fostered a different outlook. 3.5 Family and opinion leadership</p> <p>The family is a primary group involving intimate face-to-face interaction (Spiro, 1983). It is also a reference group with members referring to particular family values and norms of behaviour. Its scope has largely moved from the extended family to the more common nuclear one of today. A household is a housing unit and may include families (where at least two people are related) or non-families. Direct marketers are concerned with families because they have such strong bonds between each other. These bonds affect purchasing and families often function as the ultimate consumers. Families are the relevant decision-making unit for many products (e.g. cars, home furnishings, vacations, and appliances as well as a great number of cheaper everyday items. Rather than study a single consumer, it makes more sense to try and understand the complex interaction of family decision-making. Surprisingly little is known about the complexity of family decision-making. The traditional two-adult/two-children family is a minority, with new kinds of families, such as gay/lesbian couples and single-parent households entering the accepted definition in society. Opinion leadership relates to the issue of who consumers get their information from. It is recognized that consumers do not just ask anyone for advice, but choose particular people. People who are knowledgeable about products, and whose advice is taken seriously, are called opinion leaders.3.5.1 Family life cycle</p> <p>There are felt to be various stages in the traditional family lifecycle (Wells and Gubar, 1966; Gilly and Enis, 1982). These include:3.5.2 Purchasing decisions (a) Roles</p> <p>Different members of the family tend to perform different roles in the recognition of need and the taking of purchase decisions. Typical roles include: Instrumental leaders who fulfil the task in hand. Men tend to fill this role and concern themselves with functional attributes and participate most actively in making the actual purchase. Expressive fulfil the need for morale and cohesion. Women tend to fill this role and are more concerned with aesthetic attributes and with suggesting the purchase.Purchasing</p> <p>- Initiator</p> <p>- Influencer - Information gatherer - Decision maker - Purchaser - User(b) Power structure</p> <p>The balance in power within a family will typically vary from one purchase situation to another. These can be: Male dominant (e.g, lawnmower, power tools). Female dominant (e.g. child's clothing, toiletries, and some groceries). Joint in which both partners share decision-making (e.g. holidays, major appliances, and furniture). Autonomic where the relative influence of both partners varies (e.g. males dominate stereos and cameras, whereas women dominate jewellery and toys). Gender role power in decision-making varies significantly across product categories. In particular, equal decision-making occurs most frequently for expensive outlays or where the purchase affects all members together. Conflict may arise when the family members diverge or disagree on a decision. Such conflict may be explicit or implicit and different strategies may be adopted to resolve the problem.3.5.3 Situational influences</p> <p>Culture is a powerful influence. In Europe and North America there is a tendency to equality in many decisions. In Latin America women are subordinated in many ways, but quite free in others. In Moslem and many other cultures wives are rigidly subordinated. In Europe, research indicates that joint decision-making is most likely: amongst higher social classes and particularly middle; in the early stages of the life cycle; where families have geographic mobility; in rural areas; in families with children; where couples are married. 3.5.4 Changes in families</p> <p>A variety of changes have occurred in family set-ups, values, and purchasing behaviour over the past 30 years, including:</p> <p>fewer children; women spending more time outside the family; more female professionals; tendency for women to be more individualistic than collective in their decisions; shopping as a shared male-female activity; evening and weekend shopping trips; New Breed Husbands willing to share housework; growth in single households and one-parent families owing to either the postponement of marriage, of divorce, or death; time becoming a critical resource for many families. 3.5.5 Children</p> <p>Families transmit the cultural meanings of society to their children and thereby influence their children's behaviour. Consumer socialization is the term behaviourists give to this process of how children acquire knowledge about goods and services and the buying-process, such as bargaining. Amongst others, as well as the family, friends, teachers, and television participate in this process. Children undoubtedly have a say in what their parents buy, especially for products like cereals, clothing, toys, and ice cream. Research indicates they have a lesser influence on more expensive items such as computers or health or moral related items such as toothpaste or videos. On a personal basis, some parents will allow their children to participate actively in purchasing and others will be more restrictive. As children age they tend to get what they want more often, but this can be explained by their own growing maturity in...</p>