consumer behavior: how and why we buy chapter five

Consumer Behavior:Consumer Behavior: How and Why We BuyHow and Why We Buy

Chapter FiveChapter Five

5-2© 2012 Pearson Education, Inc. publishing as Prentice-Hall.

Chapter ObjectivesChapter Objectives

Define consumer behavior and explain Define consumer behavior and explain the purchase decision-making processthe purchase decision-making process

Explain how internal factors influence Explain how internal factors influence consumers’ decision-making processesconsumers’ decision-making processes

Show how situational factors and Show how situational factors and consumers’ relationships with other consumers’ relationships with other people influence consumer behaviorpeople influence consumer behavior


Real People, Real Choices: Real People, Real Choices: Decision Time at (RED)Decision Time at (RED)

What is the optimal way to generate the What is the optimal way to generate the most money for the Global Fund? most money for the Global Fund?

• Option 1:Option 1: Expand the (RED) model Expand the (RED) model based on what the research revealed based on what the research revealed about the teen marketabout the teen market

• Option 2:Option 2: Stick with the existing (RED) Stick with the existing (RED) modelmodel

• Option 3:Option 3: Expand the (RED) model to Expand the (RED) model to include more traditional non-profit include more traditional non-profit aspectsaspects


The Consumer Decision-The Consumer Decision-Making ProcessMaking Process

Consumer behavior: Consumer behavior: The process we use to select, The process we use to select, purchase, use, and dispose of goods, purchase, use, and dispose of goods, services, ideas, or experiences to services, ideas, or experiences to satisfy needs/desiressatisfy needs/desires

Internal, situational, and social factors Internal, situational, and social factors influence consumer behaviorinfluence consumer behavior


Not All Decisions Are the Not All Decisions Are the SameSame

The amount of effort expended in The amount of effort expended in decision-making varies according to decision-making varies according to the nature of the task:the nature of the task:

• Extended problem-solvingExtended problem-solving

• Limited problem solvingLimited problem solving

• Habitual decision-makingHabitual decision-making


Figure 5.1Figure 5.1The Consumer Decision-Making The Consumer Decision-Making

ProcessProcess


Figure 5.2Figure 5.2Extended Problem Solving vs. Extended Problem Solving vs.

Habitual Decision MakingHabitual Decision Making


Step 1: Problem RecognitionStep 1: Problem Recognition

Occurs whenever the Occurs whenever the consumer sees a consumer sees a significant difference significant difference between his/her between his/her current state and the current state and the desired/ideal statedesired/ideal state

Marketers can Marketers can develop ads that develop ads that stimulate problem stimulate problem recognition recognition

Examples?Examples?


Step 2: Information SearchStep 2: Information Search

Consumers need Consumers need adequate adequate information to information to make a decisionmake a decision

• Consumers Consumers search memory search memory and the and the environment for environment for informationinformation



Consumers need adequate Consumers need adequate information to make a decisioninformation to make a decision• Internet search engines, portals, and Internet search engines, portals, and

shopbots are being increasingly shopbots are being increasingly relied uponrelied upon

www.google.comwww.google.com

www.edmunds.comwww.edmunds.com

www.shopzilla.comwww.shopzilla.com



Behavioral targeting: Behavioral targeting:

• Marketers deliver ads for products Marketers deliver ads for products consumers look for by watching what consumers look for by watching what they do onlinethey do online

Audience Science’s Behavioral TargetingAudience Science’s Behavioral Targeting


It’s DebatableIt’s DebatableClass Discussion QuestionClass Discussion Question

Most consumers agree that using demographic information for targeting purposes is acceptable, but critics contend that tracking users browsing and surfing behavior crosses the line.

What do you think? Should stronger controls be in place to protect consumers privacy?


Step 3: Evaluation of Step 3: Evaluation of AlternativesAlternatives

Identifying a Identifying a small number of small number of products for products for further further consideration consideration

Evaluating Evaluating alternatives alternatives using evaluative using evaluative criteriacriteria


Step 4: Product ChoiceStep 4: Product Choice

Consumers often rely on heuristics to Consumers often rely on heuristics to make decisionsmake decisions

• Heuristics: Heuristics: A mental rule of thumb used for a A mental rule of thumb used for a speedy decision, such as . . .speedy decision, such as . . .Price equals qualityPrice equals qualityBrand loyaltyBrand loyaltyCountry of originCountry of origin


Step 5: Postpurchase Step 5: Postpurchase EvaluationEvaluation

Consumer satisfaction/dissatisfaction Consumer satisfaction/dissatisfaction after purchase of product is criticalafter purchase of product is critical• Degree of satisfaction is influenced by Degree of satisfaction is influenced by

whether or not expectations of product whether or not expectations of product quality are met/exceeded quality are met/exceeded

• Marketing communications must create Marketing communications must create accurate expectations for the productaccurate expectations for the product

• Cognitive dissonance is commonCognitive dissonance is common What actions can marketers take to What actions can marketers take to

alleviate cognitive dissonance?alleviate cognitive dissonance?


Figure 5.4Figure 5.4Influences on Consumer Decision Influences on Consumer Decision

MakingMaking


PerceptionPerception

Perception:Perception:

• Process by which we select, organize, and Process by which we select, organize, and interpret information from outside worldinterpret information from outside world

Three factors are necessary for perception to Three factors are necessary for perception to occuroccur

• Exposure:Exposure: capable of registering a stimulus capable of registering a stimulus

• Attention:Attention: mental processing activity mental processing activity

• Interpretation:Interpretation: assigning meaning assigning meaning to a stimulusto a stimulus


MotivationMotivation

Motivation:Motivation:Internal state that Internal state that drives us to satisfy drives us to satisfy needs by activating needs by activating goal-oriented goal-oriented behaviorbehavior


Figure 5.5Figure 5.5Maslow’s Hierarchy of Needs and Maslow’s Hierarchy of Needs and

Related ProductsRelated Products


LearningLearning

Learning:Learning:A relatively A relatively permanent change permanent change in behavior caused in behavior caused by information or by information or experienceexperience

Learning theoriesLearning theories• BehavioralBehavioral

• CognitiveCognitive


AttitudesAttitudes

Attitude:Attitude:Lasting evaluations of a person, object, Lasting evaluations of a person, object, or issueor issue

• Three attitude componentsThree attitude componentsAffect (feeling): emotional responseAffect (feeling): emotional responseCognition (knowing): beliefs or Cognition (knowing): beliefs or

knowledgeknowledgeBehavior (doing): intention to do Behavior (doing): intention to do

somethingsomething


AttitudesAttitudes


PersonalityPersonality

Personality:Personality:The set of unique The set of unique psychological psychological characteristics that characteristics that consistently consistently influences the way a influences the way a person responds to person responds to situations in the situations in the environmentenvironment

Self-conceptSelf-concept


AgeAge

Age:Age:

• Goods/services often appeal to a Goods/services often appeal to a specific age group specific age group

• Purchases are often associated with a Purchases are often associated with a particular stage in the family life cycleparticular stage in the family life cycle

Name some products that can be Name some products that can be successfully marketed on the basis of successfully marketed on the basis of age or stage in the family life cycleage or stage in the family life cycle


LifestyleLifestyle

Lifestyles reflect aLifestyles reflect a pattern of living pattern of living

Marketers seek to Marketers seek to describe people describe people according to activities, according to activities, interests, and opinionsinterests, and opinions

Psychographics: Psychographics: Group consumers Group consumers according to according to psychological and psychological and behavioral similaritiesbehavioral similarities


Situational and Social Situational and Social InfluencesInfluences

on Consumers’ Decisionson Consumers’ Decisions Situational factors shape purchase Situational factors shape purchase

choices:choices:

• Physical environmentPhysical environmentSensory marketingSensory marketing

• Time povertyTime poverty


CultureCulture

Culture:Culture:The values, beliefs, The values, beliefs, customs, and tastes customs, and tastes produced or practiced produced or practiced by a group of peopleby a group of people

• Includes key rituals like Includes key rituals like weddings and funeralsweddings and funerals

• Marketers tailor Marketers tailor products to cultural products to cultural valuesvalues


CultureCulture

Subculture:Subculture:A group within a society who share a A group within a society who share a distinctive set of beliefs, distinctive set of beliefs, characteristics, or common characteristics, or common experiencesexperiences

• MicroculturesMicrocultures

What other examples of microcultures What other examples of microcultures can you think of?can you think of?


Emerging Lifestyle TrendsEmerging Lifestyle Trends

ConsumerismConsumerism

• A social movement that attempts to A social movement that attempts to protect consumers from harmful protect consumers from harmful business practicesbusiness practices

Consumer WatchdogConsumer Watchdog

The consumeristThe consumerist


It’s DebatableIt’s DebatableClass Discussion QuestionClass Discussion Question

Should cell phone companies and satellite television providers be allowed to require consumers to sign contracts for a minimum period of service?

Should they be allowed to charge consumers for the cost of service on the remaining contract months in the case of early termination?


Emerging Lifestyle TrendsEmerging Lifestyle Trends

EnvironmentalismEnvironmentalism

• Seeks conservation and improvement Seeks conservation and improvement of the natural environmentof the natural environmentKyoto ProtocolKyoto ProtocolEnvironmental stewardship Environmental stewardship Green marketingGreen marketing

GreenwashingIndex.comGreenwashingIndex.com


Social ClassSocial Class

Social class:Social class:The overall rank or social standing of groups The overall rank or social standing of groups of people within a society, according to of people within a society, according to factors such as family background, factors such as family background, education, occupation, and incomeeducation, occupation, and income

• Status symbols such as luxury products allow Status symbols such as luxury products allow people to flaunt their social classespeople to flaunt their social classes

• Mass-class consumers are targeted by many Mass-class consumers are targeted by many marketersmarketers


Group MembershipsGroup Memberships

Reference group: Reference group: An actual or imaginary An actual or imaginary individual or group individual or group that has a significant that has a significant effect on an effect on an individual’s individual’s evaluations, evaluations, aspirations, or aspirations, or behaviorbehavior


Opinion LeadersOpinion Leaders

Opinion leadersOpinion leaders• Are frequently able to influence others’ Are frequently able to influence others’

attitudes or behaviorsattitudes or behaviors

• Have high interest in product categoryHave high interest in product category

• Update knowledge by reading, talking Update knowledge by reading, talking with salespeople, etc.with salespeople, etc.

• Impart both positive and negative Impart both positive and negative product informationproduct information

• Are among the first to buy goodsAre among the first to buy goods


Gender RolesGender Roles

Gender rolesGender rolesSociety’s expectations regarding Society’s expectations regarding appropriate attitudes, behaviors, and appropriate attitudes, behaviors, and appearance for men and womenappearance for men and women• Consumers often associate “sex-typed” Consumers often associate “sex-typed”

products with one products with one gender or other gender or other

• Sex roles are Sex roles are constantly constantly evolvingevolving


Real People, Real Choices: Real People, Real Choices: Decision Made at (RED)Decision Made at (RED)

Julia chose option 1 Julia chose option 1

•Why did Julia choose to continue to Why did Julia choose to continue to seek major international brands to seek major international brands to partner with, while complementing partner with, while complementing those partnerships with smaller special those partnerships with smaller special editions that appealed to a younger age editions that appealed to a younger age group? group?


Keeping It Real:Keeping It Real: Fast-Forward to Fast-Forward to Next Class Decision Time at NCRNext Class Decision Time at NCR

Meet Brad Tracy, VP of Americas Meet Brad Tracy, VP of Americas Marketing Deployment for NCRMarketing Deployment for NCR

NCR recently released a new NCR recently released a new generation of point of sale (POS) generation of point of sale (POS) workstationsworkstations

The decision to be made: The decision to be made: Should NCR continue to attend a Should NCR continue to attend a particular trade show? particular trade show?


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consumer behavior: how and why we buy chapter five

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