consumer-behavior-study-material-for-MBA | Classical Conditioning | Attitude (Psychology)

1

CONSUMER BEHAVIOUR:

UNIT – I INTRODUCTION CONCEPTS OF CONSUMER BEHAVIOUR: Definition: Consumer behaviour is defined, as a behaviour that consumers display in searching for, purchasing, using, evaluating and disposing of products and services that they expect will satisfy their needs. - Schiffman Observable activities chosen to maximize satisfaction through attainment of economic goods and services such as choice of retail outlet, preference of particular brands and so on. - Dictionary of marketing and advertising The decision process and physical activity individual engage in when evaluating, acquiring, using or disposing of goods and services. - Loudon & Della Bitta Types of consumers: • Personal consumers • Organizational consumers What is consumer behaviour? Obtaining - purchase/ receipt of product Consuming - how, where, when and under what circumstances use product Disposing - get rid Consumer behaviour roles: Initiator: Individual who determines that some needs or want is not being met and authorizes to rectify the situation. Influencer: Individual who intentionally or unintentionally influence the purchase decision. Buyer: Individual who actually make the purchase transaction. User: Individual who directly consume the product. Importance of studying consumer behaviour: • Consumer is the king. • Consumers do not always act or react as the theory suggest. • Consumer preferences are changing and become highly diversified. • Consumer dislikes identical product and prefer differential products.

2 • • •

CONSUMER BEHAVIOUR:
Segmenting the market to cater the special needs of consumers. Rapid introduction of new products with technological advancement To sell products that might not sell easily.

O Model of consumer behaviour: Feedback to consumer Individual Consumer Environmental Influence Consumer Decision Making Consumer Response

Feedback to environment

Methods of studying consumer behaviour: Observational approach In home observation Interviews and surveys Focus group Field experimentation Consumption research products Principles of consumer behaviour: Consumer is sovereign Consumer is global Consumers are different Consumer has rights APPROACHES TO THE STUDY OF CONSUMER BEHAVIOUR: Different approaches to studying consumer behaviour are:  Managerial approach  Holistic approach  Balanced approach Managerial approach: - It is more micro and cognitive in nature.

3

CONSUMER BEHAVIOUR:

- Micro: emphasizes the individual consumer like his attitude, perception, life style, etc. - Cognitive: emphasizes the thought process of individual consumers and factors in influencing their decision. - Marketers are interested in this approach because all marketing strategy is to satisfy the individual consumers need. - Risks in managerial approach:  Overemphasizes the rationality of consumers  Overlook the dynamics of environmental factors independent of individual  Focus is on purchase rather than consumption Holistic approach: - It is more macro in nature. - It focuses on consumption experience rather than purchasing process. - It helps in understanding the environmental context of consumer action. - Risks in holistic approach are:  No emphasize on purchase decision.  No understanding of cognitive process, which is necessary for the marketer to meet consumer needs. Balanced approach: In balanced approach both the managerial view and holistic view are taken by eliminating the drawbacks. APPLICATION OF CONSUMER BEHAVIOUR KNOWLEDGE IN MARKETING DECISION: Understanding of consumer behaviour is essential for the long run success of any marketing program. Some of marketing activities were consumer behaviour knowledge is important are:  Market-opportunity analysis  Target market selection  Marketing mix determination Market opportunity analysis: - It involves analyzing the market to identify unsatisfied needs and wants. - The analysis begins with a study of general market trends such as consumers lifestyle and income levels which suggests unsatisfied needs and wants. Target market selection: - Market opportunity analysis results in the selection of target market ie distinct groupings of consumers who have unique wants and needs.

shelter and clothing. Psycogenic need: . o Utilitarian or hedonic need Biogenic need:  The need for air.4 CONSUMER BEHAVIOUR: .Eg: Colgate.Palmolive company segment consumers according to their life style pattern and personalities to identify a unique group of consumers for a certain type of deodorant soap. o Physical need. water and sunlight . Physical need:  The need for food. Market-mix determination: Marketing mix variables are:  Product  Price  Place  Promotion CONSUMERS DON’T ACT A UNIT – II CONSUMER AS AN INDIVIDUAL CONSUMER NEEDS AND MOTIVES CONSUMER NEEDS Need: Basic feel of desire Want: The means of satisfying the need Types of needs: o Biogenic need. o Psycogenic need.

etc. Hierarchy of needs: • Dr. self-esteem.  Ads for products and services that promote physical health is an appeal to this level of the need hierarchy.  This need implies that consumer will emphasize the tangible quality of the product. • The hierarchy of needs are: o Physiological needs. o Social needs. insurance policies. etc.  Eg: Need for love.  Eg: In India need to accumulate wealth for daughter’s marriage shows attachment and affection. • Individual seek to satisfy lower-level of needs before higher-level of needs emerge. affection. Ego needs: . Utilitarian or Hedonic Need:  This need satisfies consumer’s dreams and builds up self confidence. water. education. o Safety and security needs. power.  Eg: Need for efficient washing powder. • This theory identifies five basic level of human needs ranked in the order of importance.  Eg: need for food.5 CONSUMER BEHAVIOUR:  The needs acquired in the process of becoming a member of a particular society or culture.  This include need for affection. Social needs:  This level satisfies the need for human relationship.  This need is required to sustain biological life. shelter. clothing.  Ads of personal care products appeal to this need. Safety and security needs:  Once the first level is satisfied this need become the driving force for human behavior. Need to own a car.  Focus on tomorrow’s life. o Ego needs. a clinical psychologist formulated the theory of human needs. etc.  This need is also called as biogenic need or physical need. Physiological needs:  Basic level of human needs.  Eg: savings account. o Self-actualization needs. belonging and acceptance.Abraham Maslow .

 Useful tool to the marketer as well.  Based on the desire for friendship.  They are more self-confident and risk-taking. success. etc. Self-actualization needs:  This need refers to individual desire to fulfill his or her potential or fully exploiting ones potential. Problems:  It cannot be tested empirically.  Eg: Player working single-mindedly for many years to excel in his sports. self-esteem. Inwardly directed ego needs reflects need for self-acceptance.  It is related to both ego need and self-actualization need.  Need for achievement:  People with high achievement need regard personal accomplishment as an end in itself.  No way to measure precisely how satisfied one level of need before the next higher level become operative.etc. Marketing application:  Helps marketer to focus the advertisement appeal to the need level shared by large segment. Evaluation and marketing application:  It has received wide acceptance in various social discipline.  Only few satisfy this need. .etc. to control other persons.  People with high affiliation needs are socially dependent on others.  Need for power:  This relate to individual desire to control his or her environment.6 CONSUMER BEHAVIOUR:    Either inward or outward oriented. etc. reputation. Outwardly directed Ego needs reflects need for prestige. status.  It is related to ego needs. Trio of needs:  Need for affiliation:  It is a social motive and it influences consumer behaviour.for acceptance.  Facilitate product positioning and repositioning.

Needs wants.7 CONSUMER BEHAVIOUR: (modue-3) MOTIVATION Definition:  Motivation is a driving force within an individual that impels them to action. Learning Learning Needs wants. and desires and desires Tension Tension Drive Drive Behavior Behavior Goal or Goal or need need fulfillfulfillment ment Cognitiv Cognitiv ee processes processes Tension Tension reduction reduction . Model of motivation: This model portrays motivation as a state of need induced tension that drives the individual to engage in behaviour that he or she believes will satisfy the need and thus reduce the tension.

Types of motives: The types are:     Strong vs. weak motive Conscious vs. unconscious motive Positive vs. emotional motive Arousal of motives: Four arousal of motives are:  Physiological arousal  Emotional arousal  Cognitive arousal  Environmental arousal Physiological arousal: .  Influencing choice criteria:  Motives guide consumers to buy certain products and not the other.  Influencing consumer perception and learning:  Motives influences consumer perception and learning process. negative motive Rational vs.8 CONSUMER BEHAVIOUR: Role or functions of motives: The role of motive is to arouse and direct the behaviour of consumers.  The product is the goal to consumers. etc which consumer seeks to achieve. Some of the functions of motives are:  Defining basic striving:  Motives influence consumers to develop and identify their basic striving which includes general goals such as safety. affiliation.  Identifying goal objects:  Consumers view product or service as a mean to satisfy their motives.

 Eg: ads that provide reminder of home make one feel to speak with parents. Environmental arousal:  Certain cues in the environment arouse a set of needs.  Eg: fear of examination drives the student to sit and study.  Eg: End of school day will arouse a need for food. Cognitive arousal:  Random thought can lead to cognitive awareness of needs.9 CONSUMER BEHAVIOUR:  Physiological cues are involuntary and it cause uncomfortable tension.  Motivational research includes all type of measures into human motives.  Sigmund freud’s psychoanalytical theory of personality provide the foundation for the development of motivational research. .  Motivational research:  Motivational research is a qualitative research designed to uncover the consumers subconscious or hidden motivation. Limitations:  This research is qualitative and experiment can be performed for only small group so generalization of the result for large group will sometimes give wrong result. Emotional arousal:  Autistic thinking(Daydreaming) arouse emotional need and drive them into goal oriented behaiour. Dynamics of motivation:  Needs are never fully satisfied  New needs emerges as old needs are satisfied  Success and failure influence goals  Substitute goal  Frustration Measurement of motives:  Motives are hypothetical constructs and are not tangibly observed.  This research generate more subjective opinion and it is difficult for the marketer to understand consumer behaviour.  No single measurement exists so combination of various qualitative research techniques is used.  Eg: stomach contraction will trigger awareness of a hunger need.

10 CONSUMER BEHAVIOUR: PERSONALITY AND CONSUMER BEHAVIOUR Definition:  Personality is defined as the inner psychological characteristics that both determine and reflect how a person responds to his or her environment.  Personality can change:  Some major life events and gradual maturing process changes the personality.  Trait theory.  Many individuals may be similar in terms of single personality characteristic which help marketers to categorize consumers into different groups and identify their market segment. Theories of personality: Personality theories are:  Freudian theory.  Personality is consistent and enduring:  Personality has both consistency and endurance. Nature of personality:  Personality reflects individual difference:  Individual personality are unique combination of factors so no individuals are alike. .  Neo-Freudian theory.

 Personality theory with a focus on psychological characteristics  Trait . It sees whether individual satisfies the need in the socially acceptable fashion.11 CONSUMER BEHAVIOUR:  Freudian theory:  This theory is proposed by Sigmund Freuds’. relatively enduring way in which one individual differs from another  Personality is linked to how consumers make their choices or to consumption of a broad product category . Ego: Individual’s conscious control that balances the demands of the id and superego  Neo-Freudian personality theory:  Social relationships are fundamental to the formation and development of personality. o Aggressive individuals: those who move against others. etc.  This theory is built on the premises “Unconscious needs or drives are at the heart of human motivation”. Superego: Individual’s internal expression of society’s moral and ethical codes of conduct. thirst. Eg: hunger. o Detached individuals: those who move away from others.not a specific brand.  Human personality consist of 3 interacting systems: o Id o Superego o Ego Id: Warehouse of primitive or instinctual needs for which individual seeks immediate satisfaction.  Trait Theory:  This theory is a quantitative measure.  The traits that are measured are: .  Three personality group of individuals are: o Compliant individuals: those who move towards others.any distinguishing.

 Some of the personality traits that differentiate innovators and noninnovators. new services or new practices.  Dogmatism:  A personality trait that reflects the degree of rigidity a person displays toward the unfamiliar and toward information that is contrary to his or her own established beliefs.  Sensation seeking: .  Consumer innovativeness:  The degree to which consumers are receptive to new products.  Inner-Directed: o Consumers who tend to rely on their own inner values o More likely to be innovators o Tend to prefer ads that stress product features and benefits  Other-Directed : o Consumers who tend to look to others for direction o Less likely to be innovators o Tend to prefer ads that feature social acceptance  Need for uniqueness:  Consumers who avoid appearing to conform to expectations or standards of others. High OSL consumers tend to accept risky and novel products more readily than low OSL consumers.12 CONSUMER BEHAVIOUR: o Consumer innovativeness: how receptive a person is to a new experience.  Optimum stimulation level:  A personality trait that measures the level or amount of novelty or complexity that individuals seek in their personal experiences.  Low dogmatic-like to try new product.  Social character:  It is a personality trait that range from inner-directedness to otherdirectedness.  Consumer innovators are the first to try new product.  High dogmatic-discomfort with new product. o Consumer ethnocentrism: the consumers likelihood to accept or reject foreign made products Consumer innovativeness:  How receptive a person is to a new experience. o Consumer materialism:: the degree of consumer attachment to a wordly possession.

• Visualizers versus verbalizers o A person’s preference for information presented visually or verbally Consumer materialism:  The degree of consumer attachment to a worldly possession.  The extent to which a person is considered “materialistic.13 CONSUMER BEHAVIOUR:  A personality trait characterized by the need for varied. which measures a consumer’s degree to variety seeking  Examples: Exploratory Purchase Behavior Use Innovativeness Vicarious Exploration  Cognitive personality factors: Two cognitive personality traits are: Need for cognition. novel. and complex sensations and experience. o The dedication of a considerable amount of discretionary time and money to searching out the product  Examples: stamp collectors. hobbyists . Visualizers vs verbalizers. and the willingness to take physical and social risks for the sake of such experience  Variety-novelty seeking:  A personality trait similar to OSL.  Characteristic of materialistic people:  Value acquiring and showing-off possessions  Are particularly self-centered and selfish  Seek lifestyles full of possessions  Have many possessions that do not lead to greater happiness  Fixed consumption behavior  Consumers fixated on certain products or categories of products  Consumers have o A deep interest in a particular object or product category o A willingness to go to considerable lengths to secure items in the category of interest. • Need for cognition o A person’s craving for enjoyment of thinking o Consumers high in NC are more likely to respond to ads rich in product-related information o Consumers low in NC are more likely to be attracted to background or peripheral aspects of an ad.

14 CONSUMER BEHAVIOUR:  Compulsive consumption behavior  “Addicted” or “out-of-control” consumers  Consumers who are compulsive buyers have an addiction. [How we see the world around us] .  Eg: dishwashing liquid – demanding task master. and interprets stimuli into a meaningful and coherent picture of the world. Brand Personality Personality-like traits associated with brands.  Eg: Mr.  Eg: coca-cola with red connotes excitement. in some respects.  Product personality and gender:  Associating a product or brand with a gender. they are out of control and their actions may have damaging consequences to them and to those around them Consumer Ethnocentrism:  The consumers likelihood to accept or reject foreign made products  Ethnocentric consumers feel it is wrong to purchase foreign-made products  They can be targeted by stressing nationalistic themes.coffee – masculine personality.safety Perdue .dependable and rugged  Brand personification:  Associating a human-like character to a brand is called as brand personification. CONSUMER PERCEPTION Definition: The process by which an individual selects.performance Levi’s 501 .  Eg: salem jasmine. Bath soap – feminine personality.  Personality and color:  Associating product personality with color.freshness Nike .the athlete BMW . organizes.  Product personality and geography:  Certain product possess strong geographical association. Examples: Volvo .

: ads.  Differential threshold: o The minimal difference that can be detected between two similar stimuli is called the differential threshold or just noticeable difference(j. ears. E. o Sensory adaptation is getting used to certain sensations so advertisers try to change their advertisement campaigns regularly. o Weber’s law states that “stronger the initial stimulus.50 is not noticeable(below j. e.n.eg: reduction in product size or quality . o Eg: Increase of 25 cent to a orange juice worth$5. o Sensory receptors are human organs like eyes. brand name. o Weber’s law is the theory concerning the perceived differentiation between similar stimuli of varying intensities. o A perfectly unchanging environment provides little or no sensation at all.n. o The point at which a person can detect a difference between something & nothing.g.n.: honking horn is never noticed in heavy traffic.n.g. the greater the additional intensity needed for the second stimulus to be perceived as different”. mouth and skin.15 CONSUMER BEHAVIOUR: Elements of perception: The elements of perception are:  Sensation  Absolute threshold  Differential threshold  Subliminal perception  Sensation: o Sensation is the immediate and direct response of the sensory organs to stimuli.d). o Stimulus or stimuli is any unit of input to any of the senses.  Absolute threshold: o The lowest level at which an individual can experience a sensation is called the absolute threshold. etc.d) o Marketing Applications of the JND o : o Marketers use this concept for the following reasons: o Negative change is not noticed by the consumers (below j.d) but same increase of 25 cent to a gasoline is quickly noticed by the consumer(above j. nose.d). o Eg: the distance at which the driver can note a specific billboard on a highway.

 Perceptual organization.  Three aspects of perception are:  Perceptual selection. etc  Expectations:  People see what they expect to see and they expect to see is based on familiarity.  The variables should be attention-compelling to get selected. o Perception of stimuli that are above the level of conscious awareness is called as supraliminal perception or perception. package design. Model or process of perception: Dynamics of perception:  Perception is the result of two kinds of input: Physical stimuli from outside world Based on previous experience of individual  Stimulus are selected. . organized & interpreted in line with their needs and wants  . ad. previous experience and expectations(preconditioned set).  Perceptual interpretation.d).g: women in a supermarket gets exposed to numerous stimuli but select the item she needs and leave because she exercise selectivity in perception.  Stimuli get selected depends on two major factors:  Consumers’ previous experience  Consumers’ motives at that time Factors for the stimulus to be perceived or selected:  Nature of the stimulus:  Marketing stimuli includes a number of variables that effect perception like brand name.  Subliminal perception : o Perception of very weak or rapid stimuli received below the level of conscious awareness is called as subliminal perception.  Eg: contract in package. poster like ads in magazines.16 CONSUMER BEHAVIOUR: o Product improvement is noticed by the consumers (above j. Perceptual selection:  Consumers subconsciously exercise a great deal of selectivity in the environment. etc.  e. etc. lower price.eg: improved packing .n.

 Motives:  People tend to perceive the things they need or want.  Grouping:  Consumers group the stimuli to form a unified picture and facilitate their memory.  Perceptual Defense:  Consumers subconsciously avoid stimuli that are psychologically threatening.  Perceptual Blocking:  Consumers are bombarded with numerous stimuli and they block from conscious awareness. Perceptual organization:  Perceptual organization principles are based on gesalt psychology.  Selective Attention:  Consumer exhibit high awareness for the stimuli that meet their needs and lo awareness for stimuli that are irrelevant.17 CONSUMER BEHAVIOUR:  Eg: when a person expect the movie to be terrifying will find it so. Concepts Concerning Selective Perception : Concepts Concerning Selective Perception are:  Selective Exposure  Selective Attention  Perceptual Defense  Perceptual Blocking  Selective Exposure:  Consumers view messages that are pleasant and sympathetic and avoid painful or threatening one.  The basic principles are:  Figure and ground  Grouping  Closure  Figure and ground:  Stimuli that contrast with their environment are more likely to be noticed. .  Eg: Lufthansa ad featured a jet flying between two glass high-rise building.  People do not experience the numerous stumili as separate instead they perceive them as unified whole.

 E.  First Impressions:  First impression is ever lasting and it is the challenge for the marketer to form so.  Attractive models are perceived to have more expertise regarding enhancing product(jewelry) and problem solving products(product to avoid dandruff).  Eg:ad for tea which shows a couple associate tea drinking with romance and fine living.  Perceptual interpretation:  The interpretation of stumili is uniquely individual.: hearing the first line of ad consumer draw conclusion about the product. .  Halo Effect:  Evaluation of multiple objects on the basis of the evaluation of just one dimension. Jumping to Conclusions:  Consumer jump to conclusion before examining all the complete evidence.  Influences of Perceptual Distortion: o Physical Appearances o Stereotypes o First Impressions o Jumping to Conclusions o Halo Effect  Physical Appearances:  People tend to attribute the quality of the product based on the qualities of personality featuring in the ad.18 CONSUMER BEHAVIOUR: Grouping is advantageous to the marketer to associate a meaning for their product.  Stereotypes:  People tend to form their own picture in their mind for various stimuli.g.  Closure:  Incomplete message are better remembered than complete ones.

.19 CONSUMER BEHAVIOUR: (Module 4) (A) CONSUMER LEARNING: Definition: Consumer learning is the process by which individuals acquire the purchase and consumption knowledge and experience that they apply to future related behaviour. Not concerned with the process of learning as they are with inputs and outputs of learning. Behavioural theories are: Classical conditioning.a Russian physiologist was first to propose this theory. Elements of Learning Theories: Motivation Cues Response Reinforcement Learning theories: Behavioural learning theories Cognitive learning theories Behavioural learning theories: It is also referred as stimulus-response theory. Classical conditioning: Ivan Pavlov . Instrumental or Operant conditioning. Importance of Learning: Marketers must teach consumers: –where to buy –how to use –how to maintain –how to dispose of products Types or process of learning: Two types are: Intentional learning: acquired as a result of careful search. Incidental learning: acquired by accident without much effort.

Neo-Pavlovian Conditioning: Creation of strong association between CS and US requires: •Forward Conditioning (CS Precedes US) •Repeated Pairings of CS and US •A CS and US that Logically Belong together . classical conditioning is not reflexive action. but rather the acquisition of new knowledge. From this viewpoint.20 CONSUMER BEHAVIOUR: According to this theory “Conditioned learning results when a stimulus is paired with another stimulus that elicits a known response that serves to produce the same response when used alone”. Dog experiment. Unconditioned Stimulus Meat paste Conditioned Stimulus Bell AFTER REPEATED PAIRINGS Conditioned Stimulus Bell Conditioned Response Salivation Cognitive Associative Learning: Classical conditioning is viewed as the learning of associations among events that allows the organism to anticipate and represent its environment.

F. Advertising wearout: though overlearning aids retention. American psychologist developed this theory. Stimulus Generalization: The inability to perceive differences between slightly dissimilar stimuli. Licensing. print types. This is known as advertising wearout. Product differentiation: this strategy is designed to distinguish a product or brand from its competitors on the basis of attribute that is relevant and valuable to the consumers. Stimulus Discrimination: The ability to select a specific stimulus from among similar stimuli because of perceived differences is called as stimulus discrimination Positioning: the image or position that the product or service holds in the mind of consumer is critical for its success.Skinner. . Three hit theory: three exposures to an ad are necessary for the ad to be effective . Imitative “Me-too” product succeed in the market place because of this. Family branding. Product form extension. at some point an individual will become satiated to numerous exposure and both attention and retention will decline. Product category extension. Stimulus generalization helps marketer for: Product line extension.etc) and substantive variation(change in the ad content). Instrumental or operant conditioning: B.21 CONSUMER BEHAVIOUR: •A CS that is Novel and Unfamiliar •A US that is Biologically or Symbolically Salient Strategic Applications of Classical Conditioning: Repetition Stimulus Generalization Stimulus Discrimination Repetition: Repetition increase the strength of association between CS and US so reduce the process of forgetting. To avoid this marketers use cosmetic variation(change in background.

Information processing and memory stores: Workin Long g -term Memor Store y Forgotten. A cognitive theory of human learning patterned after computer information processing focuses on how information is stored in human memory and how it is retrieved. Reinforcement of behaviour: Positive Reinforcement: Positive outcomes that strengthen the likelihood of a specific response Example: Ad showing beautiful hair as a reinforcement to buy shampoo Negative Reinforcement: Unpleasant or negative outcomes that serve to encourage a specific behavior Example: Ad showing wrinkled skin as reinforcement to buy skin cream. Also known as modeling or vicarious learning. Rehearsal Forgotten.22 CONSUMER BEHAVIOUR: Consumers learn by means of trial and error process in which some purchase behaviors result in more favorable outcomes (rewards) than other purchase behaviors. Information processing: Information processing is related to both consumers cognitive ability and complexity of information to be processed. Rat kept in skinner box experiment. Encoding Forgotten. Strategic application of Instrumental Conditioning: Customer Satisfaction (Reinforcement) Reinforcement Schedules –Shaping Massed versus Distributed Learning Observational Learning A process by which individuals observe the behavior of others and consequences of such behavior. Cognitive learning theory: It holds that the kind of learning most characteristic of human beings is problem solving. Eg: associating with dad and imitating the same behaviour. A favorable experience in instrumental is teaching the individual to repeat a specific behavior. Retrieval (Shortlost lost unavailable term Sensor y Store . It is helpful in complex goal oriented activity. which enables individuals to gain some control over their environment Learning involves complex mental processing of information.

Models of cognitive learning: Involvement theory: It is also called as split-brain theory and is developed from the research stream called hemispheral lateralization.23 CONSUMER BEHAVIOUR: Retention: Information is stored in long-term memory Episodically: by the order in which it is acquired Semantically: according to significant concepts. .

Left hemisphere of the brain is responsible for cognitive activities and it is rational.Eg:automobiles and dandruff shampoo. Media strategy: Print media is high involvement media. Highly involved consumers are narrow categorizers and uninvolved or low involved consumers are called as broad categorizer. Right hemisphere of the brain is concerned with nonverbal. Limitation: both the brains work together to process information. Central and Peripheral Routes to Persuasion This theory proposes that highly involved consumers are best reached through ads that focus on the specific attributes of the product (the central route(left)) while . depending on the relevance of the purchase. Left brain: Information is actively processed in left brain with high involvement.etc.24 CONSUMER BEHAVIOUR: Involvement theory of consumer learning postulates that consumers engage in a range of information processing activity from extensive to limited problem solving.implusive and intuitive Issues in Involvement Theory Involvement Theory and Media Strategy Involvement Theory and Consumer Relevance Central and Peripheral Routes to Persuasion Measures of Involvement Involvement theory and media strategy: Right brain: Individual passively process information in right brain with low involvement so repetition produces a change in consumer behaviour (eg: product purchase) which intern change the attitude of the consumer. Consistent with classical conditioning. Media strategy: TV is a pictorial media so it is low inolvement media and repeated exposure of TV commercial will aid in the purchase of the product. Involvement theory and consumer relevance: High personal relevance of the product and high perceived risk aids the consumer for high-involvement purchase. eg: dish washing liquid. pictorial information and it is emotional. Low personal relevance of the product and low perceived risk aids the consumer for low-involvement purchase. active and realistic.

Involvement HIGH Central Route LOW Peripheral Route Message Arguments Influence Attitudes Peripheral Cues Influence Attitudes . When the product is high personally relevant then involvement increases and consumer follow central route for information processing. When the product is low personally relevant then involvement decreases and consumer follow peripheral route for information processing. Elaboration Likelihood Model (ELM): This theory suggests that a person’s level of involvement during message processing is a critical factor in determining which route to persuasion is likely to be effective.25 CONSUMER BEHAVIOUR: uninvolved consumers can be attracted through peripheral advertising cues such as the model or the setting (the peripheral route(right)).

What are Attitudes? The attitude “object” Attitudes are a learned predisposition Attitudes have consistency Attitudes occur within a situation Structural Models of Attitudes: Tricomponent Attitude Model Muliattribute Attitude Model The Trying-to-Consume Model Attitude-toward-the-Ad Model Tricomponent Attitude Model: Attitude consist of 3 components: Cognitive component. Conative component. . Affective component.26 CONSUMER BEHAVIOUR: Measures of Consumer Learning Recognition and Recall Measures Aided and Unaided Recall Cognitive Responses to Advertising Copytesting Measures Attitudinal and Behavioral Measures of Brand Loyalty Brand loyalty (B) CONSUMER ATTITUDES : Definition: A learned predisposition to behave in a consistently favorable or unfavorable manner with respect to a given object.

27 CONSUMER BEHAVIOUR: Cognitive Component: The knowledge and perceptions that are acquired by a combination of direct experience with the attitude object and related information from various sources. Conative Component The likelihood or tendency that an individual will undertake a specific action or behave in a particular way with regard to the attitude object. Affective Component: A consumer’s emotions or feelings about a particular product or brand. Consumers have unfavorable attitude towards brand which do not have adequate level of attributes. Theory-of-reasoned-action model Attitude-toward-object model: Attitude towards a product is function of evaluation of product-specific beliefs or attributes. Multiattribute Attitude Models: Attitude models that examine the composition of consumer attitudes in terms of selected product attributes or beliefs. Cognitive component shows the consumer intension to buy. Attitude-Toward-Behavior Model: A model that proposes that a consumer’s attitude toward a specific behavior is a function of how strongly he or she believes that the action will lead to a specific outcome (either favorable or unfavorable). Some of the models are: Attitude-towards-object model. This knowledge and perception take the form of belief. . Consumers have favorable attitude towards brand which have adequate level of attributes. Attitude-towards-behaviour model.

and behavior. Attitude-Toward-the-Ad Model: A model that proposes that a consumer forms various feelings (affects) and judgments (cognitions) as the result of exposure to an advertisement. which. . in turn. affect the consumer’s attitude toward the ad and attitude toward the brand.28 CONSUMER BEHAVIOUR: Theory of Reasoned Action: A comprehensive theory of the interrelationship among attitudes. Theory of Trying to Consume: An attitude theory designed to account for the many cases where the action or outcome is not certain but instead reflects the consumer’s attempt to consume (or purchase). intentions.

Mass media. Eg: individual with high need for cognition form positive attitude towards ad that are rich with information and vice–versa. Strategies of Attitude Change: Changing the basic motivational function: Utilitarian function. Direct marketing. Sources of influence on attitude formation: Four main sources are: Personal experience. Experience: Attitudes follow purchase and consumption of a product. . Personality factors: Personality plays a role in attitude formation. Value-expressive function. Issues in Attitude Formation : How attitudes are learned Sources of influence on attitude formation Personality factors How attitudes are learned: Attitudes are learned by the following ways: Association: Consumers purchase new product that are associated with the favourably know brand (ie the brand name towards which the consumer already have favourable attitude).29 CONSUMER BEHAVIOUR: ATTITUDE FORMATION AND CHANGE: Attitude formation is the process of shifting from having no attitude to having some attitude about the given object. Influence of family and friends. Ego-defensive function. Sometimes consumer try new brand and they form favourable attitude towards it if it gives satisfactory experience. Information: When consumers try to satisfy their needs they form the attitude about the product based on the information exposure of that product.

Tactics to overcome post purchase dissonance: Rationalize the decision being wise. Behavior precede or follow attitude formation: Cognitive dissonance theory: According to cognitive dissonance theory “discomfort or dissonance occurs when a consumer holds conflicting thoughts about a belief or an attitude object”. Altering components of multiattribute model. SELF IMAGE: Enduring image of themselves is called as self. event or cause. There is a relationship between brand preference and consumers self-image.30 CONSUMER BEHAVIOUR: Knowledge-expressive function. . Issues in Attribution Theory Self-perception Theory Foot-In-The-Door Technique Attributions Toward Others Attributions Toward Things How We Test Our Attributions Self-perception Theory: A theory that suggests that consumers develop attitudes by reflecting on their own behavior. Associating the product with special group. Tell friends the positive feature of the brand.image. Change brand belief Improve your brand rating Add attribute Change the relative evaluation of attribute Changing belief about competitors brand. Resolving two conflicting attitudes. When cognitive dissonance occurs after purchase it is called as post purchase dissonance. Individual’s self-image is unique. Reassure with existing satisfied owners. Attribution theory: A theory concerned with how people assign casualty to events and form or alter their attitudes as an outcome of assessing their own or other people’s behavior. Consumers try to enhance their self-image by selecting the product with image that they believe will enhance their own self-image.

. needs. interest. Sender should analyze the target audience personal characteristic like education. experience and memory are the factors of persuasion. idea. . Virtual personality: Online individuals have an opportunity to try on different personalities Virtual personalities may result in different purchase behavior COMMUNICATION AND PERSUATION: Definition: Communication is the transmission of a message from a sender to a receiver via a medium or channel of transmission. Media strategy: Placement of ad in the specific media is important for success of the message. Designing persuasive communication: Communication strategy: Establish communication objective. Message strategy: Message is a thought. E.: promoting sales of a product. etc to design a effective message. Components of communication: Sender Receiver Medium Message Feedback Communication process: Message initiator(source). Target audience(receiver). Feedback(receivers response).31 CONSUMER BEHAVIOUR: Kinds of self-image: Actual self-image: how consumers see themselves. Target audience: Identify appropriate audience and segment them to identify target group to develop a particular message strategy. image or attitude. Perception.g. Ideal social self-image: how consumers would like others to see them. Social self-image: how consumers feel others see them. Ideal self-image: how consumers would like to see themselves. Expected self-image: how consumers expect to see themselves at some specified future time.

often used to create double meaning. or behavior. Eg: Pepsi’s slogan “hit the beach topless” next to Pepsi bottle cap lying in the sand. Message framing: Positive Message framing: stress the benefit of using specific product. Classification of groups: Membership group: A membership group is one to which a person either belongs or would qualify for membership Symbolic group: A symbolic group is one in which an individual is not likely to receive membership despite acting like a member Reference group: Reference group is any person or group that serves as a point of comparison (or reference) for an individual in the formation of either general or specific values. Comparative ad: Ad for a particular brand that says the advantage of their product and disadvantage of the competitor’s product Order effects: Primary effect Recency effect Repetition: Repetition aids in retention. UNIT – III(module 6 & 5) CONSUMERS IN THEIR SOCIAL AND CULTURAL SETTINGS GROUP DYNAMICS AND CONSUMER REFERENCE GROUPS: Group: Group may be defined as two or more people who interact to accomplish either individual or mutual goals. Negative Message framing: stress the benefit to be lost of not using specific product. attitudes. Classification of reference groups: Normative Reference Groups: .32 CONSUMER BEHAVIOUR: Message structure and presentation: Resonance: It is defined as a wordplay.

Verbally conspicuous product: influenced by the reference group. Eg: Movie stars.close friends. On the other hand they seek for advice and are influenced . Eg: family. political leaders. sports heroes. Eg: a persons normative reference group might be its neighboring family whose life style appears to be admirable. It influence in the expression of specific consumer attitude and behaviour. Inform or make the individual aware of a specific product or brand Provide the individual with the opportunity to compare his or her own thinking with the attitudes and behavior of the group Influence the individual to adopt attitudes and behavior that are consistent with the norms of the group Legitimize the decision to use the same products as the group .33 CONSUMER BEHAVIOUR: Reference groups that influence general or broadly defined values or behaviour. attractive and powerful can induce consumer attitude and behaviour change. Eg: a child’s normative reference group is its immediate family. Direct reference group: Those groups with which the individual interact on daily basis. the product and the specific social factor. Indirect reference groups: Individuals or groups with whom a person identifies but does not have direct face-to-face contact. Information and experience: Person who have experience with the product and can obtain full information about the product is not influenced by the reference group.. Consumer conformity: Reference group change the consumer attitude by encouraging conformity. Comparative Reference Groups : Reference groups that serves as a benchmark for specific or narrowly defined behaviour or attitude. attractiveness and power of reference group: A reference group that is perceived as credible. Credibility. Factors that effect reference group influence: The degree of influence depends on nature of the individual..etc. Conspicuousness of the product: Visually conspicuous product: not influenced by reference group. or TV personalities. Factors Encouraging Conformity: A Reference Group Must . It influence in the development of basic code of behaviour.

brand-name clothing. Eg: influence product such as Tupperware. Reference Group Appeals: Celebrities: Famous personalities hold the viewers attention and promote the product. Work groups. Unmarriedfamily. Eg: influence product such as Avon. Boarders . Non-Family Households: Nuclear couples. Households: Households Family Households: Married couple. Virtual groups or communities Consumer-action groups: youth development group. Eg: ad for frying pan feature a chef explaining the product. Extended family Friends/ Roommates. Eg: Other reference group appeals FAMILY: Family is defined as two or more persons related by blood. Eg: slice-of-life advertisement like Aswini hair oil. Trade or spokes-characters: Familiar cartoon character feature in the ad to promote the product. Eg: sharukhan promoting the navarathana talc powder. The executive and employee spokesperson: Top executives feature as a spokesperson in the ad.34 CONSUMER BEHAVIOUR: Selected Consumer-Related Reference Groups : Friendship groups. education group. The expert: A person by his occupation is in unique position to help the consumers evaluate the product the advertisement promotes. The “common man”: Reference group appeal that uses a testimonial of satisfied customers. marriage or adoption who reside together. Eg: Frank Perdue CEO of Perdue chicken feature in the ad. etc. Shopping groups. Eg: influence product such as snack food. etc.

Single-parent family: one parent and atleast one child. Nuclear family: A husband and wife and one or more children. knowledge. Model of socialization (slide) Consumer socialization of children: Preadolescent children acquire their consumer behaviour norms through observation of their parents and older siblings. Consumer socialization: The process by which children acquire the skills. . children and atleast one grandparent. Adolescent is influenced by the friends. Intergenerational socialization: Some product loyalties or brand preferences is transferred from one generation to another. Adult consumer socialization: Socialization is an on-going process. and attitudes necessary to function as consumers. Socialization begins in early childhood and extends throughout a persons entire life. wife. Extended family: a husband.35 CONSUMER BEHAVIOUR: Types of families: Married couple: a husband and a wife.

(Module 5) SUBCULTURAL AND CONSUMER BEHAVIOUR: Definition: Subculture is a distinct cultural group that exists as an identifiable segment within a larger. Suitable family lifestyles. American Hindu. Categories of subculture: Categories Nationality Religion examples Indian. Family decision making and consumption roles:(slide) Family life cycle: Traditional life cycle: Stage I: Bachelorhood Stage II: Honeymooners Stage III: Parenthood Stage IV: Postparenthood Stage V: Dissolution Nontraditional life cycle: (slide) Family households. Emotional support. Muslim . Non-Family households. more complex society. Importance: Subcultural analysis enables the marketers to focus on sizable and natural market segments.36 CONSUMER BEHAVIOUR: Functions of a family: Economic well-being. Subculture is the relevant unit of analysis for market research.

Buy brands perceived to be more prestigious. Midwest Tamilian. Likely to buy what their parent brought. teenager male. Are fashion conscious. Historically prefer to shop at smaller personal stores. . Geographic and Regional subculture: Individuals have the sense of regional identification and they use this identification to as a way of describing others. Increasingly clipping and using cents-off coupons.S. female engineer. upper Nationality subculture: Nationality is an important subcultural reference that guides in what customer value and what they buy. Tend not to be impulsive buyers . Many regional differences exist in consumption behavior Westerners have a mug of black coffee Easterners have a cup of coffee with milk and sugar White bread is preferred in the South and Midwest Rye and whole wheat are preferred on the East and West coasts. Prefer fresh to frozen or prepared items. Buy brands advertised by their ethnic-group stores.37 CONSUMER BEHAVIOUR: Geographic region Race Age Gender Occupation Social class Northeast. Primary organized faiths include: Protestant denominations Roman Catholicism Judaism Consumers purchase decision are influenced by their religious identity. doctor lower. Hispanic subculture: Traditional Characteristics of the Hispanic American Market: Prefer well-known brands. Religious Subcultures 200+ organized religious groups in the U. Eg: Christmas has become a gift-purchasing season of the year. Consumer Behavior is directly affected by religion in terms of products that are symbolically and ritualistically associated with the celebration of religious holidays. keralite senior citizen. middle.

Prefer high fashions and name brands “as a signal of their success”.38 CONSUMER BEHAVIOUR: Racial subculture: African-American Consumer Largest racial minority in U. Generation X: Born between 1965 and 1979. music and language. Less likely to read newspaper. Expect work-life flexibility. This group choose to be with their own rights so marketers focus on fashion. Job satisfaction is important than salary. Also called echo boomers and millennium generation 3 Subsegments of Gen Y: Gen Y Adults(age 19-24) Gen Y Teens(age 13-18) Gen Y Tweens or kids(age 8-12) Appealing to generation Y: Shifts from TV viewing to using internet so they prefer internet shopping. Baby Boomers : . Appealing to generation X: Puchase product with good brand name. Asian-American Consumers Currently about 12 million in size Estimated at 13 million in 2005 Gain of 54% since 1990 Age subculture: Four groups under this are: Generation Y Generation X Baby boomers Older consumers Generation Y: Born between 1977 and 1994. Post baby boomer segment (also referred to as Xers or busters).S. They work to live. Purchasing power estimated at $572 billion They are brand loyal.. Not trust the stores their parents shop in.

39 CONSUMER BEHAVIOUR: Individuals born between 1946 and 1964 (approximately 45% of the adult population). The vocabulary of marketing denotes the term as glocal. They enjoying buying for themselves and for their homes. . Working woman: Segmentation issues: Four Segments of women are: Stay-at-Home Housewives Plan-to-Work Housewives Just-a-Job Working Women Career-Oriented Working Women Shopping pattern: Working women spend less time in shopping. EU-European Union forms a single market and used euro as a common currency. They shop during evenings ad week-ends. including the 50-plus market and the “elderly consumers” market. Consist of subcultures. They are motivated consumers. CROSS CULTURAL CONSUMER BEHAVIOUR: Imperative to be multinational: All major companies market their products beyond their original home country. tactfulness. They brand and store loyal. Feminine traits: neatness. The largest age category alive today Frequently make important consumer purchase decisions Include a small subsegment of trend setting consumers (yuppies) who influence consumer tastes of other age segments. gentleness and talkativeness. Seniors: Generally older consumers. Three Senior Subsegments •The Young-Old (65-74) •The Old (75-84) •The Old-Old (85 and older) Gender as a subculture: Gender roles and consumer behaviour: Masculine traits: aggressiveness and competitiveness. NAFTA-North American Free Trade Agreement consist of United states.

. etc. Consumers are eager to try foreign products. Eg: IKEA furniture company offers 14 localized websites describing the product in the localized language. working in foreign. Country-of-origin effects: Consumers make purchase decision in considering country of origin of their choice. Eg: Many Chinese consumers consider Sony high-end and high-quality. Issues in Cross-Cultural Consumer Analysis Similarities and Differences Among People Time Effects The Growing Global Middle Class Acculturation Research Techniques Similarities and Differences Among People: Cross-cultural consumers analysis is used to determine how consumers of two or more societies are similar or different. Consumers taste different culture by buying unfamiliar or different product. Marketers bring new products. Germany with cars and machinery. Eg: consumers associate France with Wine. Reason for being multinational: Opportunity for future growth. Fashion clothing and perfume. Consumers taste different culture from contact with foreign movie. services. practices or ideas for international marketing and it gives cultural transfer. This analysis helps the marketer to device appropriate individualized strategies to reach consumers in specific foreign market.40 CONSUMER BEHAVIOUR: Canada and Mexico and provide free market access to more than 400 million consumers. Some consumers restrict buying product from other countries due to animosity. but may refuse to buy due to animosity toward Japan High-animosity consumers own fewer Japanese products than low-animosity consumers Cross cultural consumer analysis: It is defined as the effort to determine to what extend the consumers of two or more nations are similar or different. Acquiring exposure to other cultures: Some consumers get exposure to other culture by their own initiatives like travel.

Favoring a “World Brand”: . Middle class consumers have more discretionary(or spending) income which makes the marketers to target the middle class segment. Whether to use national borders as a segmentation strategy. marketers should develop a strategy that encourage members of that society to change their attitude and alter their behaviour. Acculturation: Acculturation is the learning of a new “foreign” culture . Applying research techniques: Since there are many research issues exist in cross-cultural analysis marketers should use the research service facility available in the foreign nation to evaluate their potential maket.41 CONSUMER BEHAVIOUR: The Growing Global Middle Class: Growing middle class in developing countries is a attractive phenomenon to the global marketers. Eg: Germany advertising rule do not permit comparative advertisement. Research Issues in cross-cultural analysis:( (slide) Alternative multinational strategies: Global Vs local Favoring a “World Brand” Adaptive Global Marketing Framework for Assessing Multinational Strategies Global Local Mixed Global Vs local: World markets are becoming more similar so the challenges for the marketers are: Whether to use shared needs and values as a segmentation strategy. behaviors and values to appropriately position and market their product. Cross-cultural acculturation is a dual process for marketers: Marketers must be sensitive to the prevailing attitudes. Marketers should learn the culture of other countries where they want to sell their product. To gain acceptance of their product in the foreign nation. Regulation in different countries may preclude the use of some marketing practices.

These firms follow “multilocal” strategies and are called as “glocal” companies. Eg: P&G ‘s global brands are: Pantene. Adaptive Global Marketing: Some firm’s marketing strategy adapts their advertisement messages to the specific values of particular cultures. packed and positioned in exactly the same way regardless of the country in which they are sold but the advertisement is in the specific target language.42 CONSUMER BEHAVIOUR: Some firms have created world brand product that are manufactured. Eg: McDonald’s. Framework for Assessing Multinational Strategies: PRODUCT STRATEGY COMMUNICATON STRATEGY STANDARDIZED COMMUNICATIONS LOCALIZED COMMUNICATIONS Mixed Strategy: Uniform Product/ Customized Message Local Strategy: Customized Product/ Customized Message STANDARDIZED PRODUCT Global strategy: Uniform Product/ Uniform Message Mixed strategy: Customized Product/ Uniform Message LOCALIZED PRODUCT Marketing Mistakes: A Failure to Understand Differences . Reebok and Levi’s. oil of Olay. etc.

power and prestige. Social comparison theory: individuals quite normally compare their own material possession with those owned by others in order to determine their relative social standing.coldness India . Eg: in many nations small sized product packages are necessary because consumers are not affordable for larger packs. Colour is a critical variable because it has different meaning in different culture. Pricing and Distribution Problems: Pricing and Distribution Policies should meet the local economic condition and customs of the target market. Social class and social status: Social class is measured in terms of social status. Status and consumer purchasing power are related. .death Sweden . Eg: Snapple failed because Japanese consumers preferred clear. Status factors are wealth. Social stratification: Social status is frequently thought of as the relatively rankings of members of each social class in terms of specific status factors. Eg: Meanings of Blue: Holland . less sweet iced tea but it is unwilling or too slow to alter its ingredients.43 CONSUMER BEHAVIOUR: Product Problems Promotional Problems Pricing and Distribution Problems Product Problems: Sometimes marketers neglect to modify their products to meet local customs and taste.purity Promotional problem: The promotional message must be consistent with the language and customs of the particular target society. SOCIAL CLASS CULTURAL ASPECTS: Definition: Social class is defined as the division of members of a society into a hierarchy of distinct status classes. so that members of each class have relatively the same status and members of all other classes have either more or less status. Status consumption: The process by which consumers endeavor to increase their social standing through conspicuous consumption or possession. individuals with more purchasing power have more status.warmth Iran .

The result may not be accurate because it gives the individuals self-perception or self-image. white collar Lower. Seven-category social-class schemas: Eg: : real lower-lower. a lower group of people but not the lowest. upper-lower. upper Four-category social-class schemas: Eg: lower.44 CONSUMER BEHAVIOUR: Socioeconomic variables as expression of status are family income. working class. upper-middle. middle-lower. lowerupper. Nine-category social-class schemas: Eg: lower-lower. upper-upper. lower-middle. Social class is hierarchical and a natural form of segmentation: Social class categories are ranked in hierarchy ranging from low to high status. lower-middle. upper-lower. Measurement of social class: Three measures of social class are: Subjective measures Reputational measures Objective measures Subjective measures: In subjective approach of measuring social class. upper-middle. Hierarchical aspects of social class are important for the marketers because consumers purchase certain products favored by the members of higher social class and avoid certain product. upper Five-category social-class schemas: Eg: lower. upper-upper. upper-middle. middle-upper. individuals are asked to estimate their own social class. lower-upper. middle. Reputational measures: . upper Six-category social-class schemas: Eg: lower-lower. upper-upper. upper Three-category social-class schemas: Eg: blue-collar. middlemiddle. Social class categories: Two-category social-class schemas: Eg: blue-collar. while collar Lower. Social class membership serves as a important reference group in the development of attitude and behaviours. upper-middle. middle class. middle. occupational status and educational attainment. as they are perceived as lower class products. lower-middle. lower-middle. upper-middle. lower-upper. gray collar.

Higher education and high-income level favours upward mobility. . The final task of assigning the community members to the social class position belongs to the trained researcher. Geodemographic clustering: Linking of consumer-related geographic and socio-economic data is called as geodemographic clustering. Two categories of objective measures are: Single-variable indexes: occupation. which have some factual questions about themselves. Affluent consumers: Affluent consumers are rich or well off people. Upward mobility is common in American society. These variables are measured through questionnaires.(MRI) the market segmentation schema of upper deck consumers are: Well-featured nests: household with atleast one high-income earner and children present. Segmenting the affluent market: Affluent consumers are broadly divided into 2 groups: Upbeat enjoyers: who live for today. education and amount of income. Objective measures: Objective measure consists of some socioeconomic variables like occupation. Composite-variable indexes: combine a number of socioeconomic factors. No strings attached: household with atleast one high-income earner and no children. Positive relationship exists between health and economic status. education and income. It is proved as impractical because this approach gives the understanding of social class structure and not the consumption behaviour within the class. Social-class mobility: Individual can move either up or down in the social-class position held by their parents. their family and the place of residence. Affluent consumers constitute an attractive target segment because they have larger share of discretionary (or disposable) income. ie. According to Mediamark Research Inc. Financial positives: who are conservative and wealth savers. which is the purpose of the measure.45 CONSUMER BEHAVIOUR: The Reputational approach requires selected community informants to make initial judgment concerning the social class membership of others within the community. Healthiest people are economically advantaged.

City folks with country homes: wealthy vacationers who spend their winter or summers in scenic rural areas. . Eg: lower middle class consumers prefer T-shirt with admired personality pictures as an external point of identification. Eg: wal-mart tends to target more on working class customers. Technological class structure centers the amount of computer skills that one possesses. The rural affluent customer segments are: Suburban transplants: those who move to the country but still commute (travel) to high paying urban jobs. Wealthy landowners: wealthy farmers. familiarity and competency with technology is the base for this class standing. Arrival of techno-class: Techno-class is a new type of social class category. The good life: households that have high degree of affluence with no persons employed. Two careers: households that have two or more earners neither earning high income and no children.46 CONSUMER BEHAVIOUR: Nanny’s incharge: households that have two or more earners none earning high income and children present. Lack of computer skill is referred as technologically underclassed. Upper class consumers prefer clothing with subtle (fine) look. The degree of literacy. These consumers reflect modest lifestyles They are more brand loyal because they are not affordable to make mistake by switching over to unfamiliar brands. Shopping: People avoid stores that have image appealing to a social class very different from their own. Fashion: Specific social class differ in terms of what they consider as fashionable or in good taste. Non-affluent consumers: Lower income or downscale consumers are called as non-affluent consumers. Equity-rich suburban expatriates: urbanites who sell their home for high profit and buy a less expensive home in a small town and live. Consumer behaviour applications of social class: Some of the applications are: Clothing: People dress to fit their self-image Individuals clothing reflects their perception of their own social class membership.

Lower class consumers seeks immediate gratification and are interested in safety and security. go for fishing. Informal learning: child learns by imitating the behaviour of friends or family members. and customs that serve to regulate the consumer behavior of members of a particular society Culture satisfies needs: Culture exist to satisfy the needs of the people within a society. Issues in culture: Enculturation and acculturation Language and symbols Ritual Sharing of Culture Enculturation and acculturation: The learning of one’s own culture is known as enculturation. where to eat. read novels. Culture is learned: 3 forms of cultural learning are: Formal learning: the elders of the family teach a young family member “how to behave”. Language and symbols: . stocks and real estates. Technical learning: teacher instructs a child in educational settings to behave in a certain manner. what to serve guests at a dinner party. or wedding. values. Saving. etc. Eg: upper class consumers go to theaters. Upper class consumers use credit card as a “substitute for money”. Culture offers order. direction. picnic. The learning of a new foreign culture is known as acculturation. Lower class purchaser use credit cards to “buy now and pay later”. etc. Lower class consumers watch TV. and guidance in all phases of human problem solving: When to eat.47 CONSUMER BEHAVIOUR: Pursuit of leisure: Different social class members differ in the choice of recreational and leisure-time activities. what to eat for each meal. CULTURE:( (slide) Definition: The sum total of learned beliefs. spending and credit: Upper class consumers are more future oriented and invest in insurance.

which share the responsibility of cultural transfer. Other institutions. are: educational institution and houses of worship. etc. Symbol is anything that stands for something else. The method is frequently used to determine prevailing social values of a society.48 CONSUMER BEHAVIOUR: Members of common culture share common language for efficient communication. Characteristics of Field Observation Takes place within a natural environment Performed sometimes without the subject’s awareness Focuses on observation of behavior Participant-Observers : Researchers who participate in the environment that they are studying without notifying those who are being observed. Ritual: Ritual is a type of symbolic activity consisting of a series of steps occurring in a fixed sequence and repeated overtime. Nonverbal symbols are figures. written and pictorial communication. Marketers use verbal or non-verbal symbols to convey desired product images. Consumer Fieldwork: A cultural measurement technique that takes place within a natural environment that focuses on observing behavior (sometimes without the subjects’ awareness). colors. Measurement of culture: Content Analysis Consumer Fieldwork Value Measurement Instruments Content Analysis Content analysis is a method for systematically analyzing the content of verbal. Value Measurement Survey Instruments: . shapes. Verbal symbols are ad in magazine or TV announcements. Sharing of Culture: Culture is viewed as a group customs that link together the members of a society.

List of Values (LOV): A value measurement instrument that asks consumers to identify their two most important values from a nine-value list that is based on the terminal values of the Rokeach Value Survey Values and Lifestyles (VALS): A value measurement based on two categories: self-definition and resources. ways of reaching personal goals).e.. Elements of opinion leadership: Opinion Leader Opinion Receiver Opinion Seeker .e.. UNIT – IV(module 7) CONSUMER DECISION PROCESS AND POST-PURCHASE BEHAVIOUR PERSONAL INFLUENCE AND OPINION LEADERSHIP: Definition: Opinion leadership is the process by which one person (the opinion leader) informally influences the consumption actions or attitudes of others who may be opinion seekers or opinion recipients.49 CONSUMER BEHAVIOUR: Rokeach Value Survey (RVS): A self-administered inventory consisting of eighteen “terminal” values (i. personal goals) and eighteen “instrumental” values (i.

Viral Marketing: It is named viral because it allows the message to spread like a virus. creating the potential for exponential growth in the message’s exposure and influence. Examples of Opinion Leadership : During a coffee break. Information and Advice: Opinion leaders are the source of both information and advice. Opinion receiver or opinion recipients: individuals who receive information without consciously searching for it. . Opinion seekers: individuals who actively seek information and advice about a product. A family decides that they would like a swimming pool for their backyard and they ask neighbours who have pools which pool construction company they should call. They receive no compensation for their advice. They do not have commercial motive. a co-worker talks about the movie he saw last night and recommends seeing it. The other names of viral marketing are: Buzz Marketing Wildfire Marketing Avalanche Marketing Reasons for the Effectiveness of Opinion Leadership: Credibility Positive and Negative Product Information Information and Advice Opinion Leadership Is Category-Specific Opinion Leadership Is a Two-way Street Credibility: Opinion leaders are highly credible source of information and have first hand experience with the product.50 CONSUMER BEHAVIOUR: Opinion leader: individuals who influence the behaviour of others. Positive and Negative Product Information: Opinion leader provide both positive and negative product information. Viral marketing describe any strategy that encourages individuals to pass on a marketing message to others.

retail store and price information.51 CONSUMER BEHAVIOUR: They may share their experience with the product or aggressively advice others to buy or avoid a specific product. Motivations Behind Opinion Leadership: The Needs of Opinion Leaders The Needs of Opinion Receivers Purchase Pals Surrogate Buyers versus Opinion Leaders The Needs of Opinion Leaders: Opinion leaders may try to reduce their own post purchase dissonance. Informal relationship with end-users 2. They reduce their search time. even for the same product. Opinion Leadership Is Category-Specific: Opinion leaders specialize in certain product category about which they provide information or advice. rigor in search and screening of alternatives low . Male purchase pals are the source of product category expertise. Purchase Pals: Purchase pals are information sources who actually accompany consumers on shopping trips. Accountability limited regarding the outcome of advice 7. product involvement. product information. Information exchange occurs in the context of a casual interaction 3. Female purchase pals gives moral support and increase confidence in the buyers decision. Surrogate Buyers versus Opinion Leaders: OPINION LEADER: 1. Opinion Leadership Is a Two-way Street: Consumers who are opinion leaders in one product-related situation may become opinion receivers in another situation. opinion leaders are motivated by self-involvement. Opinion receivers reduce their perceived risk. social involvement and message involvement. Homophilous (to a certain extent) to end-users 4. The Needs of Opinion Receivers: Opinion receivers obtain new-product or new-usage information. As accountability limited. Does not get paid for advice 5. Usually socially more active than end-users 6.

More than one can be consulted before making a final decision 10. Usually specializes for a specific product/service category Measurement of Opinion Leadership: Self-Designating Method Sociometric Method Key Informant Method Objective Method OPINION LEADERSHIP MEASUREMENT METHOD DESCRIPTION OF METHOD SAMPLE QUESTIONS ASKED SELF-DESIGNATING METHOD OPINION LEADERSHIP MEASUREMENT METHOD SOCIOMETRIC Each respondent is asked a series of questions to determine the degree to which he or she perceives himself or herself to be an opinion leader. is the source of power) 4. SAMPLE QUESTIONS “Whom do you ASKE “Have you tried th product? . High level of accountability 7. May not have used the product for personal consumption 9. therefore gets paid 5. Information exchange in the form of formal instructions/advice 3.52 CONSUMER BEHAVIOUR: 8. Usually hired. Second opinion taken on rare occasions 10. Same person can be an opinion leader for a variety of related product categories SURROGATE BUYER 1. occupation-related status 2. DESCRIPTION OF METHOD “Do you influence other people in their selection of products?” METHOD KEY INFORMANT METHOD OBJECTIVE METHOD Members of a social system are asked to identify to whom they ask?”“Who asks you Carefully selected key informants in “Who are the most give advice and to whom they for info about that a social system are asked to designate influential people i go for advice. Formal relationship. the group?” Artificially places individuals in a position to act as opinion leaders and measures results of their efforts. product category?” opinion leaders. Search and screening of alternatives more rigorous 8. Not necessarily socially more active than end-users 6. Heterophilus to end users (that is. Likely to have used the product personally 9.

Opinion leaders in one product area often are opinion leaders in related areas in which they are also interested. Market maven: .53 CONSUMER BEHAVIOUR: Profile of Opinion Leaders: GENERALIZED ATTRIBUTES ACROSS PRODUCT CATEGORIES Innovativeness Willingness to talk Self-confidence Gregariousness Cognitive differentiation CATEGORY-SPECIFIC ATTRIBUTES Interest Knowledge Special-interest media exposure Same age Same social status Social exposure outside group Frequency and overlap of opinion leadership: Opinion leadership tends to overlap across certain combination of interest areas.

54

CONSUMER BEHAVIOUR:

Individuals whose influence stems from a general knowledge or market expertise that leads to an early awareness of new products and services.

The Interpersonal Flow of Communication Two-Step Flow: A communication model that portrays opinion leaders as direct receivers of information from mass media sources who, in turn, interpret and transmit this information.

Step 1 Mass Media Opinion Leaders

Step 2 Opinion Receivers (the masses)

Multistep Flow: A revision of the traditional two-step theory that shows multiple communication flows. Opinion leaders both influence and are influenced by opinion receivers.

Informatio n Receivers
Issues In Opinion Leadership and Marketing Strategy: Marketers are aware of the power that opinion leader

55

CONSUMER BEHAVIOUR:

ship exerts on consumer preference so they encourage word-of-mouth communication. Eg: Sony Walkman attained its market share by word-of-mouth communication. Marketers strategy to stimulate opinion leaders are: Programs Designed to Stimulate Opinion Leadership Advertisements Stimulating Opinion Leadership Word of Mouth May Be Uncontrollable Creation of Opinion Leaders Programs Designed to Stimulate Opinion Leadership: Advertisement and promotional program designed to persuade consumers to “tell your friends how much you like our product” are one way in which marketers encourage consumer discussion of their product and services. Advertisements Stimulating Opinion Leadership: Advertisements stimulate product discussion by portraying people in the act of informal communication. Eg: informal communication of more women is often portrayed in TV advertisement of personal care products. Word of Mouth May Be Uncontrollable: Word-of –mouth is difficult to control so both positive and negative product information spreads like a forest fire. Creation of Opinion Leaders: Product-specific opinion leaders can be created by taking socially involved or influential people and deliberating increasing their enthusiasm for a product category. DIFFUSION OF INNOVATIONS: The framework of exploring consumer acceptance of new products is known as diffusion of innovations. Two important processes under the study of diffusion of innovations are: Diffusion process. Adoption process. Diffusion Process : The process by which the acceptance of an innovation (new product, new idea or new service) is spread by communication to members of social system (target market) over a period of time. It is a macro process. Elements of the Diffusion Process : The Innovation The Channels of Communication The Social System Time

56

CONSUMER BEHAVIOUR:

The innovation: Various definition of innovation or new products are: Firm-oriented definitions Product-oriented definitions Market-oriented definitions Consumer-oriented definitions

Firm-oriented definitions: This approach defines a product as new when the company produces it or markets it for the first time. Product-oriented definitions: This approach defines the newness of the product based on the feature inherent in the product and on the effect these features are likely to have on consumers. Market-oriented definitions: This approach defines the newness of the product in terms of how much exposure consumers have to the new products. Consumer-oriented definitions: Consumer-oriented approach a new product is any product that a potential consumers judges to be new. The channels of communication: Communication channels helps in spreading the innovation to the target market. Some of the sources of communication are: Word-of-mouth communication. Impersonal sources (advertising and editorial matters) Interpersonal sources (salespeople and informal opinion leaders) The social system: A social system is a physical, social or cultural environment to which people belong and within which they function. Eg: for a new hybrid seed corn the social system is all the farmers. Time: Time is a backbone of diffusion process. Three aspects under this are: The amount of purchase time The identification of adopter categories The rate of adoption Purchase time:

This gives information about the total time taken by the new product to achieve widespread adoption. Adopters categories: A sequence of categories that describes how early (or late) a consumer adopts a new product in relation to other adopters.57 CONSUMER BEHAVIOUR: Purchase time is the amount of time that elapses between consumer’s initial awareness of a new product and point at which they purchase or reject it. Adopter categories are: Innovators: Venturesome Very eager to try new ideas Acceptable if risk is daring More cosmopolite social relationships Communicates with other innovators Early Adopters: Respected More integrated into the local social system The persons to check with before adopting a new idea Category contains greatest number of opinion leaders Are role models Early Majority: Deliberate Adopt new ideas just prior to the average time Seldom hold leadership positions Deliberate for some time before adopting Late Majority: Skeptical Adopt new ideas just after the average time Adopting may be both an economic necessity and a reaction to peer pressures Innovations approached cautiously Laggards : Traditional The last people to adopt an innovation Most “localite” in outlook Oriented to the past Suspicious of the new Rate of adoption: .

the consumer decides to reject it. which offers a 30-day full refund policy.58 CONSUMER BEHAVIOUR: The time taken by a new product to get adopted to the members of social system. Evaluation NAME OF STAGE Trial After talking to a knowledgeable friend. Adoption (Rejection) Janet finds that the MP3 player is easy to use and that the sound quality is excellent. .com. rather than a limited basis--if unfavorable. Janet decides that this MP3 player will allow her to easily download the MP3 files that she has on her computer. It is a micro process. consumer decides to use the product on a full. Interest Janet reads about the MP3 player on the manufacturer’s Web site and then goes to an electronics store near her apartment and has a salesperson show her a unit. Consumer is interested in the product and searches for additional information. to continue using (or discontinue using) a new product. She keeps the MP3 player. She also feels that the unit’s size is small enough to easily fit into her beltpack.” STAGE Consumer uses the product on a limited basis If trial is favorable. EXAMPLE Since an MP3 player cannot be “tried” like a small tube of toothpaste. Janet buys the MP3 player online from Amazon. Consumer decides whether or not to believe that this product or service will satisfy the need--a kind of WHAT HAPPENS DURING THIS “mental trial. Stages in adoption process: NAME OF STAGE Awareness WHAT HAPPENS DURING THIS STAGE Consumer is first exposed to the product innovation. Marketers adopts two types of policy to increase the adoption rate: Penetration policy Skimming policy Adoption Process : The stages through which an individual consumer passes in arriving at a decision to try (or not to try). EXAMPLE Janet sees an ad for a new MP3 player in the magazine she is reading.

Personality Traits: Consumer innovators are Less dogmatic: approach new product with openness.59 CONSUMER BEHAVIOUR: Adoption process model: (slide) Profile of consumer innovators: Defining the Consumer Innovator Interest in the Product Category The Innovator Is an Opinion Leader Personality Traits Media Habits Social Characteristics Demographic Characteristics Defining the Consumer Innovator: Consumer innovators are small group of consumers who are the earliest purchaser of a new product. The Innovator Is an Opinion Leader: Consumer innovators provide other consumers with information or advice about new product and influence the behaviour of others so they are called as opinion leaders. Need for uniqueness: they feel to be seen unique by using new products. Social Characteristics: Consumer innovators are more socially involved and socially accepted by others. Media Habits: Consumer innovators are less likely to watch TV. Variety seeking: they are brand switcher and try new products. They used to read special interest magazines. Inner-directed: they rely on their own values and standards while making decision High optimum stimulation level: individuals who seek unusual experience. Interest in the Product Category: Consumer innovators are more interested in the product category because they are the early purchaser of the new product. .

60 CONSUMER BEHAVIOUR: Demographic Characteristics: The demographic characteristics of consumer innovators are: Young person Higher personal income More formal education Higher occupational status CONSUMER DECISION MAKING PROCESS: Steps in consumer decision making process are: Need recognition Search for information Pre . He says the act of purchase itself is more complex decision process.purchase evaluation of alternatives Purchase Consumption Post purchase evaluation Disinvestments MODELS OF CONSUMER DECISION PROCESS: [shopper. .Lindquist – Pg.no:605] NICOSIA MODEL: Francesco Nicosia formulated this model. D. buyer and consumer behaviour – Jay. The fields are components are: The firm’s attributes and outputs or communications and the consumers psychological attributes. This model focus on conscious and deliberate decision making behaviour. The consumers search for and evaluation of the firms output and other available attributes.

61 CONSUMER BEHAVIOUR: The consumers motivated act of purchase. HOWARD-SHETH MODEL: This model depicts rational brand choice behaviour by buyer under conditions of incomplete information and limited abilities. Brand potential of the evoked set: the buyer perception that the brand in the evoked set will satisfy his needs. Search for information: active seeking of information about brands. Inhibitors: environmental factors such as price which restrain purchase of a preferred brand. Perceptual bias: distorting or altering information. Symbolic stimuli: producers representing their products in symbolic form such as in ad generate these. The learning constructs are: Motive: general or specific goals impelling action. . Four major components are: Input variables Output variables Hypothetical constructs Exogenous variables Input variables: Significant stimuli: these are actual elements of brands that the buyer confronts. Social stimuli: these are generated by social environment including family and groups. Comprehension: the buyers’ store of information about a brand. Hypothetical constructs: The perceptual constructs are: Sensitivity to information: the degree to which the buyer regulates the stimulus information flow. Purchase behaviour: the actual purchase act. Decision mediators: the buyers’ mental rule of matching and ranking purchase alternatives according to his motives. The consumers storage or use of the product. Output variables: Attention: the magnitude of the buyers information intake. Intension: the buyers forecast of which brand he will buy. Assumption that consumer begins the decision process with no predisposition regarding involved firms is restricting. Limitations: The flow is incomplete in its treatment of numerous factors internal to the consumers. Attitude: the buyer evaluation of particular brand potential to satisfy his motives.

. POST PURCHASE BEHAVIOUR: [shopper. Some variables are not well defined and difficult to measure. They are: Stimulus inputs Information processing Decision process Variables influencing the decision process Two different mode of operation by consumers are: Extended problem solving: it is characterized by high level of involvement and high perceived risk so satisfaction with the brand gives commitment to use the brand. The steps in decision process that occurs overtime are: Motivation and need recognition Search for information Alternative evaluation Purchase Outcomes The variables are grouped into four categories. design better promotion strategy. Limitations: No sharp distinction between exogenous and other variables. Negative post purchase behaviour. Kollat and Blackwell.Lindquist – Pg. This model is mechanistic in its treatment of decision process. Analyzing the post purchase behaviour is important because it has an impact on future sales.no:110] Post purchase behaviour is the behaviour of the consumers after purchasing a product. This model is complex. ENGEL-KOLLAT MODEL: This model is developed in 1968 by Engel.62 CONSUMER BEHAVIOUR: Satisfaction Exogenous variables: These are not well defined as they are external to buyers. Limitations: The role of some variables are vague. Post purchase behaviour analysis helps the marketer to improve products or services. This behaviour can be: Positive post purchase behaviour. buyer and consumer behaviour – Jay. D. The role of motives in influencing behaviour is also vague. etc. Limited problem solving: it is characterized by low level of involvement and low perceived risk so motivation to search for brand information is low and consumers will engage in nonrigirous evaluation of alternatives.

Consumer loyalty gains repeat purchase and it helps in the formation of purchase habits. Brand loyalty: Factors influencing brand loyalty: In addition to satisfaction with the purchase experience there are several other factors that influence brand loyalty. Some rumors are unintentional but some are purposely constructed and voiced to do damage. marketers or outlet that results in high level of repeat purchase or visits. Frequency of purchase: the more frequently customers purchase a product the most likely they are brand loyal. brand. Level of involvement: customers remain loyal to high involvement products than low involvement products. complaint to government agency or take legal action to obtain redress. Number of brands available: the smaller the numbers of brands available customers are more likely to be brand loyal. Brand benefits: when customer needs are satisfied by a particular brand then it gains loyalty. Negative post purchase behaviour takes several forms such as: Negative word-of-mouth: consumers express their dissatisfaction with the purchase to others. Loyalty: a consumer’s feeling of commitment to a product. Public action: seek redress from firm. Negative post purchase behaviour: Negative post purchase behaviour effect the future sales of the product and some times damages the reputation of the firm. Once the purchase habits are formed then consumers always search and buy the same brand in spite of its availability. Perceived difference among brands: if the customers perceive significant difference among brands they tend to be brand loyal. Rumor: rumors are not only negative information but also untrue information about products and brands. No action Private action: warn family and friends or decide not to buy. . Level of perceived risk: brand loyalty is high when the level of perceived risk associated with the choice is high.63 CONSUMER BEHAVIOUR: Positive post purchase behaviour: When the consumer is satisfied with the product the positive outcome is gaining customer loyalty. Complaint behaviour: dissatisfied consumers respond in one of the three ways.

Customer satisfaction is the function of customer expectations. Satisfaction Expectation Perceived Performance Dissatisfaction UNIT – V ADDITIONAL DIMENSIONS CONSUMERISM: .64 CONSUMER BEHAVIOUR: CONSUMER EXPECTATION AND SATISFACTION: Customer satisfaction is the individual’s perception of the performance of the product or service in relation to his expectation. coupled with perceived performance. If a product falls short of expectations the consumer is likely to be dissatisfied Expectations reflect anticipated behavior. The four main constructs in the model are: expectations. lead to post-purchase satisfaction. Expectations serve as the comparison standard– what consumers use to evaluate performance and form a satisfaction judgment. If a product outperforms expectations post-purchase satisfaction will result. performance. satisfaction and dissatisfaction. They are: Loyalists – completely satisfied customer who keeps purchasing Apostles – delighted consumers who spread positive word of mouth Defectors – Feels neutral and stop purchasing Terrorists – gets negative experience and spreads negative word of month Hostages – unhappy customers but keeps purchasing because of monopolistic environment Expectations-confirmation theory: Expectations-confirmation theory posits that expectations. Customer experience < expectation = Dissatisfied consumer Customer experience = expectation = Satisfied Consumer Customer experience > expectation = Delighted consumer Link between customer satisfaction and customer behaviour identifies different types of customers.

adulteration. To check unfair trade practices like monopoly power and fight against exploitation. Need for consumer protection: Some products are short in supply when the demands are high so producers try to exploit the consumers in that situation. It strike a balance in the buyer-seller relation. Uncooperative marketing institution: withholding of information from consumers and dealing in impersonal way results in the feeling that marketers are uncooperative. Roots of consumerism/ problems that underlie consumer moments: Disillusionment with the system: consumers feel their bargaining position is weakening. To effectively implement consumer protection law. etc. Motive of consumerism: To make the consumers aware of their rights and unite them into one force. To educate the consumers with latest and complete information. To fight against anti-social practice like black market. . Consumer protection means protecting the consumers from the evils of marketing. Fall in standard of living: the real purchasing power of the consumers is getting eroded. Dissatisfaction with the quality of goods and services: the quality of the product is below their expected level. Sometimes producers increase the demand by restricting the supply so they are able to push up the price. hoarding.65 CONSUMER BEHAVIOUR: Definition: Consumerism is defined as social force designed to protect consumers interests in the marketplace by organizing and exerting consumer pressure on business. Rights of consumers: The right of safety The right to be informed The right to choose The right to be heard The right to seek redressal The right to basic needs The right to consumer education CONSUMER PROTECTION: Consumer protection is the core of consumerism. irrational facts or brain washing. Consumer information gap: because of time pressure consumers are not able to collect information so they fail to consume the best. Anti-advertisement attitude: Ads are sometimes the source of unrealistic information.

Where to file a complaint? District forum: compensation < 5 lakhs State commission: 5 lakhs to 20 lakhs National commission: > 20 lakhs How to file a complaint? Complaint can be made in person or by post or through authorized agents. Consumer protection act 1986: This act was enacted to promote and protect the rights of the consumers.66 CONSUMER BEHAVIOUR: The producers exploit ignorant and uneducated consumers. Consumers sometimes will not exercise their rights because of their fear in legal proceedings. public or cooperative sectors. It provides for simple. Consumers: Consumers should be aware of their rights and should raise voice against illegal practices. . Producers should pay attention to consumer rights and they should supply quality product at reasonable price. Extend and coverage of the act: The act applies to all goods and services whether in private. What constitutes a complaint? A complaint in writing should state whether one have suffered a loss due to unfair trade practices. Since most of the people in India are middle class and poor they consider raising voice against injustice is time wasting activity. Parties in consumer protection: Three parties in consumer protection are: Business Government Consumers Business: Business comprises of the producers and the distribution channels. Who can file a complaint? A consumer or any voluntary organization or the government. Government: Government protects the consumer against exploitation through its interventions. speedy and inexpensive redressal of grievances.

cross department decision unit in which the primary objective is the acquisition. speedy and inexpensive redressal machinery Convenient procedure Covers goods and services Time-limits Class action Check on unfair practices Price Consumer councils ORGANIZATIONAL BUYER BEHAVIOUR: Definition: Organizational buying is the process by which a company/organization establishes a need for purchasing products and choose among competing brands and suppliers. impartation and processing of relevant purchasing related information. Time limit for deciding the case: The redressal foreum should address the issue within the period of 3 months from the date of notice received by the opposite party. buyers and gatekeepers Different departments role in business buying: Marketing: purchasing decision has an effect on marketability of product so they are active influencers in purchase decision process. Purchasing: they are negotiable experts dominant in straight rebuy. replacement of goods or refund the price. R & D: initial development of product and set board specification for components. Buying center roles: Primary roles – deciders and influencers Secondary roles – users. Decision making unit[buying center]: Buying center is an informal. . Manufacturing: responsible for determining the feasibility and economic consideration of producing end products.67 CONSUMER BEHAVIOUR: Relief available to consumers: The redressal forum may gives order for removal of defects from goods. The features of the act are: Social welfare legislation Effective provisions and safeguards Special consumer courts Simple.

Buyer goes for first time purchase so take lot of time to decide about the purchase. New task: This is most risky decision of buyer. Modified rebuy: This situation occurs when buyer wants to modify any purchase ie improvement in product specification and this poses a threat and opportunity to suppliers.68 CONSUMER BEHAVIOUR: Buying situation: 3 types of situation are: Straight rebuy: Straight rebuy is a repetitive or routine buying order placed by the buyer to the supplier. Model of industrial buyer behaviour: The different aspects of this model are: Difference between individuals involved and psychological make up Joint decision making Product specific factors Organization factors affecting purchase Situational factors Ways of information search Conflict resolution among individuals Industrial buying behaviour is affected by the background of the individuals involved in the purchase. The factors are: Specialized education Roles and status Lifestyle Expectation from the product .

Sign up to vote on this title
UsefulNot useful

Master Your Semester with Scribd & The New York Times

Special offer for students: Only $4.99/month.

Master Your Semester with a Special Offer from Scribd & The New York Times

Cancel anytime.