Definition of Consumer Behavior

Individuals or groups acquiring, using and disposing of products, services, ideas, or experiences Includes search for information and actual purchase Includes an understanding of consumer thoughts, feelings, and actions

Acquisition, Consumption and Disposal

Acquisition

Consumption

Receiving Finding Inheriting Producing purchasing

Collecting Nurturing Cleaning Preparing Displaying Storing Wearing Sharing

Acquisition, Consumption, Disposal

Disposal

Giving Throwing away Recycling depleting

Contributing Disciplines

Anthropology Sociology Psychology Economics History Political Science

Reasons for Studying Consumer Behavior

To stay in business by attracting and retaining customers To benefit from understanding consumer problems To establish competitive advantage because it is interesting!

The Circle of Consumption

Production Acquisition Consumption Disposal

The Circle of Consumption, continued

Typically, attention of marketers has focused on acquisition as the critical phase Only recently has more attention been given to include the full circle and the links between its elements

Disposal to acquisition Disposal to production Disposal to consumption Production to consumption Acquisition to consumption Acquisition to disposal

Consumer Research
The systematic and objective process of gathering, recording, and analyzing data for aid in understanding and predicting consumer thoughts, feelings, and behaviors. In a global environment, research has become truly international.

Important Factors in Consumer Research

Speed The Internet Globalization Data Overload

Types of Consumer Research

Basic Research

To expand knowledge about consumers in general When a decision must be made about a real-life problem

Applied Research

The Consumer Research Process

Defining the Problem and Project Scope The Research Approach The Research Design Data Collection Data Analysis and Interpretation Report

Marketing Management Philosophies

Production Concept Product Concept Selling Concept Marketing Concept Societal Marketing Concept

Green Marketing Cause-Related Marketing De-Marketing

Production Concept

Focus on Production View of consumers:

They will buy as long as the product is available and affordable. Model T: You can have any color as long as its black.

Focus on production justified:

Demand higher than supply Non-competitive product cost

Product Concept

Focus on the product View of consumers:

We have to have the best quality and the most features and they will buy.

Consumers might Consumers might best quality Consumers might quality difference Consumers might

not care about quality not be willing to pay for the

not be able to discern prefer simplicity

Selling Concept

Focus on selling View of consumers:

We have to sell to them or else they wont buy. Introductory stages of product life cycle Unsought goods

Focus on selling justified:

Marketing Concept

Focus on marketing

Creating mutually rewarding exchange relationships Consumer needs and wants have priority They will buy if you fulfill their needs better than the competition.

View of consumers:

Societal Marketing Concept

Same as Marketing Concept plus an added concern for the well-being of society

Market Research: Research Designs

Exploratory Research Descriptive Research Causal Research

Exploratory Research

Literature Research Experience Survey

Focus Groups In-Depth Interviews

Exploratory Research

Insights and Ideas Precision: Specific Hypotheses Establishment of Priorities Increase of Familiarity with Problem Clarification of Concepts

Descriptive Research

Description of Characteristics of a Certain Group Estimation of the Proportion of People in a Specified Population who Behave in a Certain Way Specific Predictions

Descriptive Research

Longitudinal Studies

True Panel Omnibus Panel Field Study Sample Survey

Cross-Sectional Analysis

True Panel: Advantages

Brand Switching Analysis Collecting Classification Information Compensation for Participation/Time Accuracy Reduced Interaction Bias

True Panel: Disadvantages

Non-Representativity Drop-out Rate Payment

Causal Research

Laboratory Experiments Field Experiments Internal and External Validity

Market Segmentation Bases

Demographic Geographic Geo-Demographic Benefit Usage Lifestyle

Market Segmentation: Advantages

Specific Definition of the Market Satisfaction of Consumer Needs Meeting Changing Market Demands Assessment of Competitive Strengths and Weaknesses Efficient Allocation of Marketing Resources Precise Setting of Marketing Objectives

Haley, 1968 Toothpaste Market

Sensory Segment Worrier Segment Sociable Segment Independent Segment

Applications of Benefit Segmentation

Positioning Repositioning Competitive positioning New market opportunities/niches Positioning of multiple brands

Usage Segmentation

Rate of Usage Brand Loyalty Usage Situation

Lifestyle Segmentation Psychographics

Activities Interests Opinions Demographics VALS I and II

Maslows Hierarchy of Needs

Consumer Decision Making: Types of Decisions

Extensive Problem Solving Limited Problem Solving Routinized Response Behavior

Problem Recognition: Causes in Current State

Depletion of Stock Dissatisfaction Decrease in Finances Increase in Finances

Problem Recognition: Causes in Desired State

New Need Circumstances New Want Circumstances New Product Opportunities Purchase of Other Products

Information Search and Evaluation

Incidental Learning

Directed Search and Evaluation

Internal only

loyalty impulse

Internal and External

Purchasing Process

When to buy? Where to buy? How to pay? How much to buy?

Post-purchase Behavior

Cognitive Dissonance Satisfaction/Dissatisfaction

Motivation

Definition Categories of Needs Arousal of Motives Motive Structuring Motive Conflict Motivation Theories

Motivation Theories

Freud Lewin Maslow

Freudian Theory

Basic Principles

Homeostasis Hedonism Id Ego Super-ego

The Structure of Personality

Projective Techniques

Word Association Sentence Completion Cartoon Test Thematic Apperception Test (TAT) Rorschach Test (inkblots)

Lewins Field Theory

Life Space Person Environment Formula Conflict

Approach-Approach Avoidance-Avoidance Approach-Avoidance

Perception

Definition Threshold Levels The Perceptual Process

Selection Organization Interpretation

Selection

Internal Factor

External Factors

Attitudes Expectations Motives Attention Span Perceptual Defense Perceptual Vigilance Adaptation Perceptual Blocking

Color Contrast Size Position Intensity/Magnitude Movement Humor Fear

Organization

Closure Figure and Ground

Interpretation

Physical Appearance Stereotypes Irrelevant Cues First Impressions Jumping to Conclusions Halo Effect

Learning

Definition Learning Theories Marketing Applications

Learning Theories

Behavioral Learning Theories

Classical Conditioning Instrumental Conditioning Consumer Information Processing

Cognitive Learning Theories

The Structure of the Memory Memory Processes

Marketing Applications

Classical Conditioning

Creating Associations Stimulus Generalization

Family Branding Product Line Extensions Licensing Look Alike Packaging

Marketing Applications

Instrumental Conditioning

Rewards Reinforcement Schedules/Advertising

Intermittent Continuous

Involvement

High Involvement Hierarchy of Effects Cognition Attitude Behavior

Low Involvement Hierarchy of Effects Cognition Behavior Attitude

Communication

The Nature of Communication Communication Model

Sender Message Receiver Psychological Noise

Sender

Source Credibility

Trustworthiness Expertise Status Other Dimensions

The Sleeper Effect

The Sleeper Effect

Consumer forget the source of the message faster than the message itself. Over time, high-credibility sources lose power to change attitudes. Over time, low-credibility sources gain power to change attitudes. High-credibility sources need to reinstate message. Low-credibility sources should not reinstate message.

Message

Size, Color, Position Order of Presentation Humor Agony Advertising Content Fear Appeals (moderate!) Audience Participation

Order of Presentation

Climax order Anticlimax order Pyramidal order What works best, depends on consumer involvement.

Receiver

Selective Attention Selective Perception Selective Appeal

Cultural Dynamics

Definition of Culture Cultural Sensitivity Culture and its Elements

Material Culture Social Institutions Humans and the Universe Aesthetics Language

Culture Defined

The sum total of knowledge, beliefs, art, morals, laws, customs, and any other capabilities and habits required by humans as members of society. The distinctive way of life of a group of people, their complete design for living, a mosaic of human life.

Subculture

Definition Types of Subcultures Selected Subcultures Acculturation

the Learning of another Culture/Subculture

Types of Subcultures

Nationality Religion Region Ethnicity Age Gender and many more.

Stages of Acculturation

Honeymoon Rejection Tolerance Integration

Social Groups

Definition Types of Groups Group Properties

Types of Groups

Primary and secondary Formal and informal Membership and symbolic In and out

Group Properties

Status Roles Norms (Sanctions) Power Socialization

Power

Reward Coercive Legitimate Referent Expert

Reference Groups

Influence on product category choice Influence on brand choice

Factors:

Luxuries vs. necessities Publicly vs. privately consumed Visibility