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. • 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. - 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. - 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. Market-mix determination: Marketing mix variables are:  Product

water and sunlight . Need to own a car.  This need implies that consumer will emphasize the tangible quality of the product. shelter and clothing.  Eg: Need for efficient washing powder. o Utilitarian or hedonic need Biogenic need:  The need for air. Physical need:  The need for food. Psycogenic need:  The needs acquired in the process of becoming a member of a particular society or culture. o Psycogenic need. self-esteem. Hierarchy of needs: .  Eg: In India need to accumulate wealth for daughter’s marriage shows attachment and affection.  This include need for affection. o Physical need. etc.   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. power. Utilitarian or Hedonic Need:  This need satisfies consumer’s dreams and builds up self confidence.

insurance policies.• • • • Dr.  Eg: savings account.  This need is required to sustain biological life. o Social needs.  Eg: need for food. o Self-actualization needs. shelter.  Focus on tomorrow’s life. water. etc. clothing. etc. The hierarchy of needs are: o Physiological needs. o Safety and security needs.  This need is also called as biogenic need or physical need.  Ads for products and services that promote physical health is an appeal to this level of the need hierarchy. This theory identifies five basic level of human needs ranked in the order of importance. a clinical psychologist formulated the theory of human needs.  Ads of personal care products appeal to this need. o Ego needs. Individual seek to satisfy lower-level of needs before higher-level of needs emerge. Physiological needs:  Basic level of human needs. education. Social needs:  This level satisfies the need for human relationship. . Safety and security needs:  Once the first level is satisfied this need become the driving force for human behavior.Abraham Maslow .

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

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 .MOTIVATION Definition:  Motivation is a driving force within an individual that impels them to action. 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. Learning Learning Needs wants.

Types of motives: The types are:     Strong vs. negative motive Rational vs. 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.  Influencing choice criteria:  Motives guide consumers to buy certain products and not the other. weak motive Conscious vs. unconscious motive Positive vs. Emotional arousal:  Autistic thinking(Daydreaming) arouse emotional need and drive them into goal oriented behaiour. emotional motive Arousal of motives: Four arousal of motives are:  Physiological arousal  Emotional arousal  Cognitive arousal  Environmental arousal Physiological arousal:  Physiological cues are involuntary and it cause uncomfortable tension.Role or functions of motives: The role of motive is to arouse and direct the behaviour of consumers.  Identifying goal objects:  Consumers view product or service as a mean to satisfy their motives.  Influencing consumer perception and learning:  Motives influences consumer perception and learning process. affiliation. .  Eg: stomach contraction will trigger awareness of a hunger need.  The product is the goal to consumers. etc which consumer seeks to achieve.

.  This research generate more subjective opinion and it is difficult for the marketer to understand consumer behaviour.  Eg: ads that provide reminder of home make one feel to speak with parents.  Motivational research includes all type of measures into human motives.  Motivational research:  Motivational research is a qualitative research designed to uncover the consumers subconscious or hidden motivation.  No single measurement exists so combination of various qualitative research techniques is used. Eg: fear of examination drives the student to sit and study. Cognitive arousal:  Random thought can lead to cognitive awareness of needs. 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.  Eg: End of school day will arouse a need for food.  Sigmund freud’s psychoanalytical theory of personality provide the foundation for the development of motivational research. Environmental arousal:  Certain cues in the environment arouse a set of needs. 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.

 Neo-Freudian theory.  Personality is consistent and enduring:  Personality has both consistency and endurance.  This theory is built on the premises “Unconscious needs or drives are at the heart of human motivation”.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.  Human personality consist of 3 interacting systems: o Id o Superego .  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.  Trait theory.  Personality can change:  Some major life events and gradual maturing process changes the personality. Nature of personality:  Personality reflects individual difference:  Individual personality are unique combination of factors so no individuals are alike.  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 .  The traits that are measured are: o Consumer innovativeness: how receptive a person is to a new experience. o Consumer materialism:: the degree of consumer attachment to a wordly possession. It sees whether individual satisfies the need in the socially acceptable fashion.  Trait Theory:  This theory is a quantitative measure. etc.  Personality theory with a focus on psychological characteristics  Trait . o Aggressive individuals: those who move against others. 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 Detached individuals: those who move away from others. Eg: hunger. Superego: Individual’s internal expression of society’s moral and ethical codes of conduct. 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.not a specific brand.any distinguishing.  Three personality group of individuals are: o Compliant individuals: those who move towards others.o Ego Id: Warehouse of primitive or instinctual needs for which individual seeks immediate satisfaction. .  Consumer innovators are the first to try new product. thirst.

High OSL consumers tend to accept risky and novel products more readily than low OSL consumers.        Some of the personality traits that differentiate innovators and noninnovators. and the willingness to take physical and social risks for the sake of such experience Variety-novelty seeking:  A personality trait similar to OSL. novel.  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. Optimum stimulation level:  A personality trait that measures the level or amount of novelty or complexity that individuals seek in their personal experiences. 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. new services or new practices. which measures a consumer’s degree to variety seeking  Examples: Exploratory Purchase Behavior Use Innovativeness Vicarious Exploration Cognitive personality factors:  . Consumer innovativeness:  The degree to which consumers are receptive to new products. Sensation seeking:  A personality trait characterized by the need for varied. Social character:  It is a personality trait that range from inner-directedness to otherdirectedness. and complex sensations and experience.  High dogmatic-discomfort with new product.  Low dogmatic-like to try new product.

• 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. 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. o The dedication of a considerable amount of discretionary time and money to searching out the product  Examples: stamp collectors. in some respects. hobbyists  Compulsive consumption behavior  “Addicted” or “out-of-control” consumers  Consumers who are compulsive buyers have an addiction.  The extent to which a person is considered “materialistic.Two cognitive personality traits are: Need for cognition. . Visualizers vs verbalizers. • 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.  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. Brand Personality Personality-like traits associated with brands.

 Personality and color:  Associating product personality with color.  Eg: salem jasmine. ears. .g. CONSUMER PERCEPTION Definition: The process by which an individual selects. brand name.g.  Eg: coca-cola with red connotes excitement. e.Examples: Volvo . nose.safety Perdue . etc.dependable and rugged  Brand personification:  Associating a human-like character to a brand is called as brand personification.coffee – masculine personality.  Product personality and gender:  Associating a product or brand with a gender.  Product personality and geography:  Certain product possess strong geographical association. o Stimulus or stimuli is any unit of input to any of the senses. o A perfectly unchanging environment provides little or no sensation at all. Bath soap – feminine personality. [How we see the world around us] 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. and interprets stimuli into a meaningful and coherent picture of the world.: ads.: honking horn is never noticed in heavy traffic.  Eg: dishwashing liquid – demanding task master. organizes.the athlete BMW .  Eg: Mr.freshness Nike . E. o Sensory receptors are human organs like eyes. mouth and skin.performance Levi’s 501 .

Model or process of perception: . lower price.eg: reduction in product size or quality o Product improvement is noticed by the consumers (above j. the greater the additional intensity needed for the second stimulus to be perceived as different”. o Perception of stimuli that are above the level of conscious awareness is called as supraliminal perception or perception.d) but same increase of 25 cent to a gasoline is quickly noticed by the consumer(above j. etc.  Subliminal perception : o Perception of very weak or rapid stimuli received below the level of conscious awareness is called as subliminal perception.d).n.n.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. o Weber’s law is the theory concerning the perceived differentiation between similar stimuli of varying intensities. o Eg: Increase of 25 cent to a orange juice worth$5.d).eg: improved packing .d). Absolute threshold: o The lowest level at which an individual can experience a sensation is called the absolute threshold.  Differential threshold: o The minimal difference that can be detected between two similar stimuli is called the differential threshold or just noticeable difference(j. o The point at which a person can detect a difference between something & nothing.50 is not noticeable(below j.n.n. o Eg: the distance at which the driver can note a specific billboard on a highway. 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.n.

etc. Perceptual selection:  Consumers subconsciously exercise a great deal of selectivity in the environment.  Three aspects of perception are:  Perceptual selection. organized & interpreted in line with their needs and wants  .g: women in a supermarket gets exposed to numerous stimuli but select the item she needs and leave because she exercise selectivity in perception. ad.  e. package design.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.  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. previous experience and expectations(preconditioned set).  The variables should be attention-compelling to get selected. .  Perceptual interpretation.  Eg: contract in package.  Eg: when a person expect the movie to be terrifying will find it so. poster like ads in magazines. etc  Expectations:  People see what they expect to see and they expect to see is based on familiarity.  Perceptual organization.

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.  Eg: Lufthansa ad featured a jet flying between two glass high-rise building.  Grouping is advantageous to the marketer to associate a meaning for their product.  Perceptual Blocking:  Consumers are bombarded with numerous stimuli and they block from conscious awareness.  The basic principles are:  Figure and ground  Grouping  Closure  Figure and ground:  Stimuli that contrast with their environment are more likely to be noticed. Perceptual organization:  Perceptual organization principles are based on gesalt psychology. Motives:  People tend to perceive the things they need or want.  Perceptual Defense:  Consumers subconsciously avoid stimuli that are psychologically threatening.  Grouping:  Consumers group the stimuli to form a unified picture and facilitate their memory. .  People do not experience the numerous stumili as separate instead they perceive them as unified whole.  Selective Attention:  Consumer exhibit high awareness for the stimuli that meet their needs and lo awareness for stimuli that are irrelevant.

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

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.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. Elements of Learning Theories: Motivation Cues Response Reinforcement Learning theories: Behavioural learning theories Cognitive learning theories .

Unconditioned Stimulus Meat paste Unconditioned Response Salivation Conditioned Stimulus Bell Conditioned Stimulus AFTER REPEATED PAIRINGS Bell Conditioned Response Salivation . Instrumental or Operant conditioning. Classical conditioning: Ivan Pavlov . Not concerned with the process of learning as they are with inputs and outputs of learning. 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”.a Russian physiologist was first to propose this theory. Dog experiment.Behavioural learning theories: It is also referred as stimulus-response theory. Behavioural theories are: Classical conditioning.

but rather the acquisition of new knowledge.etc) and substantive variation(change in the ad content). print types. To avoid this marketers use cosmetic variation(change in background. at some point an individual will become satiated to numerous exposure and both attention and retention will decline. . Three hit theory: three exposures to an ad are necessary for the ad to be effective . This is known as advertising wearout. Advertising wearout: though overlearning aids retention. classical conditioning is not reflexive action. 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 •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. From this viewpoint.Cognitive Associative Learning: Classical conditioning is viewed as the learning of associations among events that allows the organism to anticipate and represent its environment.

A favorable experience in instrumental is teaching the individual to repeat a specific behavior. Instrumental or operant conditioning: B. 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. 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.Skinner. Stimulus generalization helps marketer for: Product line extension. Family branding. 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.F. Licensing. Rat kept in skinner box experiment. 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. Product category extension. Consumers learn by means of trial and error process in which some purchase behaviors result in more favorable outcomes (rewards) than other purchase behaviors. Imitative “Me-too” product succeed in the market place because of this. American psychologist developed this theory. . Also known as modeling or vicarious learning. It is helpful in complex goal oriented activity.Stimulus Generalization: The inability to perceive differences between slightly dissimilar stimuli. Product form extension.

unavailable Retention: Information is stored in long-term memory Episodically: by the order in which it is acquired Semantically: according to significant concepts. Information processing: Information processing is related to both consumers cognitive ability and complexity of information to be processed. 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. Models of cognitive learning: . which enables individuals to gain some control over their environment Learning involves complex mental processing of information. Information processing and memory stores: Sensor y Store Rehearsal Workin g Memor y (Shortterm Long -term Store Encoding Retrieval Forgotten. lost Forgotten. 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. lost Forgotten.

active and realistic. depending on the relevance of the purchase. Involvement theory of consumer learning postulates that consumers engage in a range of information processing activity from extensive to limited problem solving. Left hemisphere of the brain is responsible for cognitive activities and it is rational.Involvement theory: It is also called as split-brain theory and is developed from the research stream called hemispheral lateralization. pictorial information and it is emotional. Consistent with classical conditioning. Right hemisphere of the brain is concerned with nonverbal.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. .

Highly involved consumers are narrow categorizers and uninvolved or low involved consumers are called as broad categorizer. Low personal relevance of the product and low perceived risk aids the consumer for low-involvement purchase. eg: dish washing liquid. Central HIGH Route Involvement Peripheral LOW Route . When the product is high personally relevant then involvement increases and consumer follow central route for information processing. 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 uninvolved consumers can be attracted through peripheral advertising cues such as the model or the setting (the peripheral route(right)).etc.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:automobiles and dandruff shampoo. 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. Left brain: Information is actively processed in left brain with high involvement. Limitation: both the brains work together to process information. When the product is low personally relevant then involvement decreases and consumer follow peripheral route for information processing. Media strategy: Print media is high involvement media.

What are Attitudes? The attitude “object” .Message Arguments Influence Attitudes Peripheral Cues Influence Attitudes 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 CONSUMER ATTITUDES : Definition: A learned predisposition to behave in a consistently favorable or unfavorable manner with respect to a given object.

Conative Component . 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. This knowledge and perception take the form of belief. Affective Component: A consumer’s emotions or feelings about a particular product or brand. Affective component. Conative component.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.

and behavior. Consumers have favorable attitude towards brand which have adequate level of attributes. Consumers have unfavorable attitude towards brand which do not have adequate level of attributes. Theory of Reasoned Action: A comprehensive theory of the interrelationship among attitudes. 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. intentions. which. Theory-of-reasoned-action model Attitude-toward-object model: Attitude towards a product is function of evaluation of product-specific beliefs or attributes.The likelihood or tendency that an individual will undertake a specific action or behave in a particular way with regard to the attitude object. . in turn. 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). affect the consumer’s attitude toward the ad and attitude toward the brand. Attitude-towards-behaviour model. 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). 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. Some of the models are: Attitude-towards-object model.

ATTITUDE FORMATION AND CHANGE: Attitude formation is the process of shifting from having no attitude to having some attitude about the given object. 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: .

When cognitive dissonance occurs after purchase it is called as post purchase dissonance. Ego-defensive function. Value-expressive function. Sometimes consumer try new brand and they form favourable attitude towards it if it gives satisfactory experience.Consumers purchase new product that are associated with the favourably know brand (ie the brand name towards which the consumer already have favourable attitude). Direct marketing. 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”. Influence of family and friends. Personality factors: Personality plays a role in attitude formation. Tactics to overcome post purchase dissonance: Rationalize the decision being wise. Change brand belief Improve your brand rating Add attribute Change the relative evaluation of attribute Changing belief about competitors brand. event or cause. Knowledge-expressive function. Strategies of Attitude Change: Changing the basic motivational function: Utilitarian function. Altering components of multiattribute model. Experience: Attitudes follow purchase and consumption of a product. Eg: individual with high need for cognition form positive attitude towards ad that are rich with information and vice–versa. Resolving two conflicting attitudes. Sources of influence on attitude formation: Four main sources are: Personal experience. Associating the product with special group. Mass media. Information: When consumers try to satisfy their needs they form the attitude about the product based on the information exposure of that product. .

Tell friends the positive feature of the brand.image. Ideal self-image: how consumers would like to see themselves. 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. Kinds of self-image: Actual self-image: how consumers see themselves. Consumers try to enhance their self-image by selecting the product with image that they believe will enhance their own self-image. Reassure with existing satisfied owners. Expected self-image: how consumers expect to see themselves at some specified future time. There is a relationship between brand preference and consumers self-image. SELF IMAGE: Enduring image of themselves is called as self. 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. Social self-image: how consumers feel others see them. Ideal social self-image: how consumers would like others to see them. 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. Components of communication: . Individual’s self-image is unique.

image or attitude.: promoting sales of a product. Perception. Designing persuasive communication: Communication strategy: Establish communication objective. . often used to create double meaning. interest. idea. Feedback(receivers response).Sender Receiver Medium Message Feedback Communication process: Message initiator(source). Sender should analyze the target audience personal characteristic like education. experience and memory are the factors of persuasion. Target audience: Identify appropriate audience and segment them to identify target group to develop a particular message strategy. etc to design a effective message.g. Message framing: Positive Message framing: stress the benefit of using specific product.. Media strategy: Placement of ad in the specific media is important for success of the message. Target audience(receiver). Message structure and presentation: Resonance: It is defined as a wordplay. Message strategy: Message is a thought. E. Eg: Pepsi’s slogan “hit the beach topless” next to Pepsi bottle cap lying in the sand. needs. 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. Negative Message framing: stress the benefit to be lost of not using specific product.

Classification of groups: .UNIT – III 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.

Classification of reference groups: Normative Reference Groups: Reference groups that influence general or broadly defined values or behaviour. Eg: a persons normative reference group might be its neighboring family whose life style appears to be admirable. Eg: family. sports heroes. Eg: a child’s normative reference group is its immediate family. Credibility. Direct reference group: Those groups with which the individual interact on daily basis. Factors that effect reference group influence: The degree of influence depends on nature of the individual. It influence in the development of basic code of behaviour.etc. or TV personalities. Indirect reference groups: Individuals or groups with whom a person identifies but does not have direct face-to-face contact. attractive and powerful can induce consumer attitude and behaviour change. attitudes. Comparative Reference Groups : Reference groups that serves as a benchmark for specific or narrowly defined behaviour or attitude. It influence in the expression of specific consumer attitude and behaviour. 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. the product and the specific social factor. Consumer conformity: . Verbally conspicuous product: influenced by the reference group.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. attractiveness and power of reference group: A reference group that is perceived as credible. On the other hand they seek for advice and are influenced . Conspicuousness of the product: Visually conspicuous product: not influenced by reference group. political leaders.close friends. or behavior. Eg: Movie stars.

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

Nuclear family: A husband and wife and one or more children. Model of socialization (slide) Consumer socialization of children: . Nuclear family. Socialization begins in early childhood and extends throughout a persons entire life. children and atleast one grandparent. Boarders Types of families: Married couple: a husband and a wife. Friends/ Roommates. Single-parent family: one parent and atleast one child. Extended family: a husband.Households: Family Households: Married couple. Consumer socialization: The process by which children acquire the skills. knowledge. Extended family Households Non-Family Households: Unmarried couples. wife. and attitudes necessary to function as consumers.

Functions of a family: Economic well-being. Muslim Northeast. Midwest Tamilian. SUBCULTURAL AND CONSUMER BEHAVIOUR: Definition: Subculture is a distinct cultural group that exists as an identifiable segment within a larger. keralite . Subculture is the relevant unit of analysis for market research. Intergenerational socialization: Some product loyalties or brand preferences is transferred from one generation to another. Non-Family households. Suitable family lifestyles. Emotional support. Adolescent is influenced by the friends.Preadolescent children acquire their consumer behaviour norms through observation of their parents and older siblings. 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. Categories of subculture: Categories Nationality Religion Geographic region Race examples Indian. Adult consumer socialization: Socialization is an on-going process. Importance: Subcultural analysis enables the marketers to focus on sizable and natural market segments. American Hindu. more complex society.

Buy brands perceived to be more prestigious. teenager male.S. Religious Subcultures 200+ organized religious groups in the U. Are fashion conscious. doctor lower. Hispanic subculture: Traditional Characteristics of the Hispanic American Market: Prefer well-known brands. Historically prefer to shop at smaller personal stores. Likely to buy what their parent brought. middle. Primary organized faiths include: Protestant denominations Roman Catholicism Judaism Consumers purchase decision are influenced by their religious identity. Racial subculture: African-American Consumer Largest racial minority in U.S. Buy brands advertised by their ethnic-group stores. Prefer fresh to frozen or prepared items. 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. Increasingly clipping and using cents-off coupons. Eg: Christmas has become a gift-purchasing season of the year.Age Gender Occupation Social class senior citizen. Consumer Behavior is directly affected by religion in terms of products that are symbolically and ritualistically associated with the celebration of religious holidays. Geographic and Regional subculture: Individuals have the sense of regional identification and they use this identification to as a way of describing others. Tend not to be impulsive buyers . upper Nationality subculture: Nationality is an important subcultural reference that guides in what customer value and what they buy. . female engineer.

Baby Boomers : Individuals born between 1946 and 1964 (approximately 45% of the adult population). Job satisfaction is important than salary. Not trust the stores their parents shop in. The largest age category alive today Frequently make important consumer purchase decisions . Appealing to generation X: Puchase product with good brand name. 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. music and language. Expect work-life flexibility. Post baby boomer segment (also referred to as Xers or busters).. Less likely to read newspaper. Generation X: Born between 1965 and 1979. Prefer high fashions and name brands “as a signal of their success”. This group choose to be with their own rights so marketers focus on fashion.Purchasing power estimated at $572 billion They are brand loyal. 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. They work to live.

They brand and store loyal. Consumers are eager to try foreign products. Feminine traits: neatness. gentleness and talkativeness. CROSS CULTURAL CONSUMER BEHAVIOUR: Imperative to be multinational: All major companies market their products beyond their original home country. They are motivated consumers. They shop during evenings ad week-ends. They enjoying buying for themselves and for their homes. Canada and Mexico and provide free market access to more than 400 million consumers. Consist of subcultures. 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.Include a small subsegment of trend setting consumers (yuppies) who influence consumer tastes of other age segments. tactfulness. The vocabulary of marketing denotes the term as glocal. NAFTA-North American Free Trade Agreement consist of United states. Reason for being multinational: Opportunity for future growth. EU-European Union forms a single market and used euro as a common currency. Seniors: Generally older consumers. 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. . including the 50-plus market and the “elderly consumers” market.

Eg: consumers associate France with Wine. Eg: Many Chinese consumers consider Sony high-end and high-quality. services. Regulation in different countries may preclude the use of some marketing practices. . Marketers bring new products. This analysis helps the marketer to device appropriate individualized strategies to reach consumers in specific foreign market. The Growing Global Middle Class: Growing middle class in developing countries is a attractive phenomenon to the global marketers. Eg: IKEA furniture company offers 14 localized websites describing the product in the localized language. Some consumers restrict buying product from other countries due to animosity. working in foreign. Germany with cars and machinery. Fashion clothing and perfume. etc. Country-of-origin effects: Consumers make purchase decision in considering country of origin of their choice. Consumers taste different culture from contact with foreign movie. Middle class consumers have more discretionary(or spending) income which makes the marketers to target the middle class segment. 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. Consumers taste different culture by buying unfamiliar or different product.Acquiring exposure to other cultures: Some consumers get exposure to other culture by their own initiatives like travel. 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. practices or ideas for international marketing and it gives cultural transfer.

These firms follow “multilocal” strategies and are called as “glocal” companies. 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. Adaptive Global Marketing: Some firm’s marketing strategy adapts their advertisement messages to the specific values of particular cultures. behaviors and values to appropriately position and market their product. To gain acceptance of their product in the foreign nation. oil of Olay. marketers should develop a strategy that encourage members of that society to change their attitude and alter their behaviour.Eg: Germany advertising rule do not permit comparative advertisement. 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. 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. Favoring a “World Brand”: Some firms have created world brand product that are manufactured. etc. Acculturation: Acculturation is the learning of a new “foreign” culture . Eg: P&G ‘s global brands are: Pantene. . Marketers should learn the culture of other countries where they want to sell their product. Whether to use national borders as a segmentation strategy. Cross-cultural acculturation is a dual process for marketers: Marketers must be sensitive to the prevailing attitudes.

Reebok and Levi’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 .Eg: McDonald’s.

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

lowerupper. upper-upper. upper Five-category social-class schemas: Eg: lower. upper-middle. lower-upper. gray collar. upper-middle. The result may not be accurate because it gives the individuals self-perception or self-image.Social class is hierarchical and a natural form of segmentation: Social class categories are ranked in hierarchy ranging from low to high status. . upper Four-category social-class schemas: Eg: lower. lower-middle. upper-middle. Nine-category social-class schemas: Eg: lower-lower. Social class categories: Two-category social-class schemas: Eg: blue-collar. lower-middle. upper-lower. lower-middle. middle-lower. lower-middle. as they are perceived as lower class products. upper Six-category social-class schemas: Eg: lower-lower. upper Three-category social-class schemas: Eg: blue-collar. upper-lower. Social class membership serves as a important reference group in the development of attitude and behaviours. upper-upper. 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. while collar Lower. lower-upper. Reputational measures: The Reputational approach requires selected community informants to make initial judgment concerning the social class membership of others within the community. middle-upper. middle class. upper-upper. middle. middlemiddle. upper-middle. Seven-category social-class schemas: Eg: : real lower-lower. working class. upper-middle. white collar Lower. middle. a lower group of people but not the lowest. 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. individuals are asked to estimate their own social class. The final task of assigning the community members to the social class position belongs to the trained researcher.

Two categories of objective measures are: Single-variable indexes: occupation. Objective measures: Objective measure consists of some socioeconomic variables like occupation. These variables are measured through questionnaires. Higher education and high-income level favours upward mobility. Segmenting the affluent market: Affluent consumers are broadly divided into 2 groups: Upbeat enjoyers: who live for today. Two careers: households that have two or more earners neither earning high income and no children. Geodemographic clustering: Linking of consumer-related geographic and socio-economic data is called as geodemographic clustering. Positive relationship exists between health and economic status. education and income. Composite-variable indexes: combine a number of socioeconomic factors. No strings attached: household with atleast one high-income earner and no children. Healthiest people are economically advantaged. Affluent consumers: Affluent consumers are rich or well off people. ie. which have some factual questions about themselves. their family and the place of residence.It is proved as impractical because this approach gives the understanding of social class structure and not the consumption behaviour within the class. which is the purpose of the measure. Upward mobility is common in American society. education and amount of income. Social-class mobility: Individual can move either up or down in the social-class position held by their parents. Nanny’s incharge: households that have two or more earners none earning high income and children present. Financial positives: who are conservative and wealth savers. The good life: households that have high degree of affluence with no persons employed. Affluent consumers constitute an attractive target segment because they have larger share of discretionary (or disposable) income. According to Mediamark Research Inc. .(MRI) the market segmentation schema of upper deck consumers are: Well-featured nests: household with atleast one high-income earner and children present.

Wealthy landowners: wealthy farmers. Non-affluent consumers: Lower income or downscale consumers are called as non-affluent consumers. Lack of computer skill is referred as technologically underclassed. Equity-rich suburban expatriates: urbanites who sell their home for high profit and buy a less expensive home in a small town and live. Upper class consumers prefer clothing with subtle (fine) look. etc. familiarity and competency with technology is the base for this class standing. Technological class structure centers the amount of computer skills that one possesses. City folks with country homes: wealthy vacationers who spend their winter or summers in scenic rural areas. etc. go for fishing. read novels. Pursuit of leisure: Different social class members differ in the choice of recreational and leisure-time activities. spending and credit: . 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. Shopping: People avoid stores that have image appealing to a social class very different from their own. Lower class consumers watch TV. Eg: upper class consumers go to theaters. Eg: wal-mart tends to target more on working class customers. Arrival of techno-class: Techno-class is a new type of social class category. Saving. Fashion: Specific social class differ in terms of what they consider as fashionable or in good taste. Eg: lower middle class consumers prefer T-shirt with admired personality pictures as an external point of identification. The degree of literacy.The rural affluent customer segments are: Suburban transplants: those who move to the country but still commute (travel) to high paying urban jobs. These consumers reflect modest lifestyles They are more brand loyal because they are not affordable to make mistake by switching over to unfamiliar brands.

Technical learning: teacher instructs a child in educational settings to behave in a certain manner. Lower class consumers seeks immediate gratification and are interested in safety and security.Upper class consumers are more future oriented and invest in insurance. Language and symbols: Members of common culture share common language for efficient communication. shapes. what to serve guests at a dinner party. and guidance in all phases of human problem solving: When to eat. etc. picnic. colors. Verbal symbols are ad in magazine or TV announcements. Lower class purchaser use credit cards to “buy now and pay later”. stocks and real estates. 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. Upper class consumers use credit card as a “substitute for money”. The learning of a new foreign culture is known as acculturation. Marketers use verbal or non-verbal symbols to convey desired product images. Symbol is anything that stands for something else. Culture is learned: 3 forms of cultural learning are: Formal learning: the elders of the family teach a young family member “how to behave”. Informal learning: child learns by imitating the behaviour of friends or family members. what to eat for each meal. . Culture offers order. 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. Nonverbal symbols are figures. CULTURE:( (slide) Definition: The sum total of learned beliefs. or wedding. direction. values. where to eat.

Ritual: Ritual is a type of symbolic activity consisting of a series of steps occurring in a fixed sequence and repeated overtime. Sharing of Culture: Culture is viewed as a group customs that link together the members of a society. Other institutions, which share the responsibility of cultural transfer, are: educational institution and houses of worship. Measurement of culture: Content Analysis Consumer Fieldwork Value Measurement Instruments Content Analysis Content analysis is a method for systematically analyzing the content of verbal, written and pictorial communication. The method is frequently used to determine prevailing social values of a society. Consumer Fieldwork: A cultural measurement technique that takes place within a natural environment that focuses on observing behavior (sometimes without the subjects’ awareness). 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. Value Measurement Survey Instruments: Rokeach Value Survey (RVS): A self-administered inventory consisting of eighteen “terminal” values (i.e., personal goals) and eighteen “instrumental” values (i.e., ways of reaching personal goals). 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.

UNIT – IV 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. Elements of opinion leadership:

Opinion Opinion Leader Opinion Receiver Seeker

Opinion leader: individuals who influence the behaviour of others. 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. Examples of Opinion Leadership : During a coffee break, a co-worker talks about the movie he saw last night and recommends seeing it. 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. Viral Marketing: It is named viral because it allows the message to spread like a virus. Viral marketing describe any strategy that encourages individuals to pass on a marketing message to others, creating the potential for exponential growth in the message’s exposure and influence. 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.

social involvement and message involvement. The Needs of Opinion Receivers: Opinion receivers obtain new-product or new-usage information. Opinion Leadership Is Category-Specific: Opinion leaders specialize in certain product category about which they provide information or advice. product involvement. Positive and Negative Product Information: Opinion leader provide both positive and negative product information. Opinion Leadership Is a Two-way Street: Consumers who are opinion leaders in one product-related situation may become opinion receivers in another situation. They reduce their search time. Male purchase pals are the source of product category expertise. Information and Advice: Opinion leaders are the source of both information and advice. They may share their experience with the product or aggressively advice others to buy or avoid a specific product. product information. 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. Purchase Pals: Purchase pals are information sources who actually accompany consumers on shopping trips. retail store and price information. Opinion receivers reduce their perceived risk. even for the same product. They do not have commercial motive. opinion leaders are motivated by self-involvement. Female purchase pals gives moral support and increase confidence in the buyers decision. Surrogate Buyers versus Opinion Leaders: OPINION LEADER: .They receive no compensation for their advice.

1. Members of a social system are asked to identify to whom they give advice and to whom they go for advice. More than one can be consulted before making a final decision 10. Search and screening of alternatives more rigorous 8. rigor in search and screening of alternatives low 8. Informal relationship with end-users 2. Likely to have used the product personally 9. is the source of power) 4. May not have used the product for personal consumption 9. Heterophilus to end users (that is. Homophilous (to a certain extent) to end-users 4. Information exchange in the form of formal instructions/advice 3. Same person can be an opinion leader for a variety of related product categories SURROGATE BUYER 1. Accountability limited regarding the outcome of advice 7. Usually socially more active than end-users 6. Not necessarily socially more active than end-users 6. Information exchange occurs in the context of a casual interaction 3. Usually hired. As accountability limited. occupation-related status 2. Does not get paid for advice 5. therefore gets paid 5. 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 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. Formal relationship. “Do you influence other people in their selection of products?” “Whom do you ask?”“Who asks you for info about that product category?” SOCIOMETRIC METHOD . Second opinion taken on rare occasions 10. High level of accountability 7.

OPINION LEADERSHIP MEASUREMENT METHOD DESCRIPTION OF METHOD SAMPLE QUESTIONS ASKE KEY INFORMANT METHOD Carefully selected key informants in “Who are the most a social system are asked to designate influential people i opinion leaders. “Have you tried th product? Frequency and overlap of opinion leadership: Opinion leadership tends to overlap across certain combination of interest areas. Opinion leaders in one product area often are opinion leaders in related areas in which they are also interested. . Market maven: Individuals whose influence stems from a general knowledge or market expertise that leads to an early awareness of new products and services. the group?” Artificially places individuals in a OBJECTIVE position to act as opinion leaders and Profile of Opinion Leaders: METHOD measures results of their efforts.

Eg: Sony Walkman attained its market share by word-of-mouth communication. Issues In Opinion Leadership and Marketing Strategy: Marketers are aware of the power that opinion leader ship exerts on consumer preference so they encourage word-of-mouth communication.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.

new idea or new service) is spread by communication to members of social system (target market) over a period of time. DIFFUSION OF INNOVATIONS: The framework of exploring consumer acceptance of new products is known as diffusion of innovations.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. 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. Adoption process. 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. Two important processes under the study of diffusion of innovations are: Diffusion process. Advertisements Stimulating Opinion Leadership: Advertisements stimulate product discussion by portraying people in the act of informal communication. It is a macro process. Eg: informal communication of more women is often portrayed in TV advertisement of personal care products. Diffusion Process : The process by which the acceptance of an innovation (new product. Elements of the Diffusion Process : The Innovation The Channels of Communication The Social System Time The innovation: Various definition of innovation or new products are: .

Impersonal sources (advertising and editorial matters) Interpersonal sources (salespeople and informal opinion leaders) The social system: A social system is a physical. This gives information about the total time taken by the new product to achieve widespread adoption. Adopters categories: . Consumer-oriented definitions: Consumer-oriented approach a new product is any product that a potential consumers judges to be new. Some of the sources of communication are: Word-of-mouth communication. Market-oriented definitions: This approach defines the newness of the product in terms of how much exposure consumers have to the new products. Three aspects under this are: The amount of purchase time The identification of adopter categories The rate of adoption Purchase time: 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. The channels of communication: Communication channels helps in spreading the innovation to the target market. Time: Time is a backbone of diffusion process. Eg: for a new hybrid seed corn the social system is all the farmers.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. social or cultural environment to which people belong and within which they function. 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.

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 time taken by a new product to get adopted to the members of social system. Marketers adopts two types of policy to increase the adoption rate: Penetration policy Skimming policy Adoption Process : .A sequence of categories that describes how early (or late) a consumer adopts a new product in relation to other adopters.

” EXAMPLE Janet sees an ad for a new MP3 player in the magazine she is reading. to continue using (or discontinue using) a new product. Evaluation After talking to a knowledgeable friend.The stages through which an individual consumer passes in arriving at a decision to try (or not to try). Adoption process model: (slide) . Janet decides that this MP3 player will allow her to easily download the MP3 files that she has on her computer. Consumer is interested in the product and searches for additional information. Stages in adoption process: NAME OF STAGE Awareness WHAT HAPPENS DURING THIS STAGE Consumer is first exposed to the product innovation. It is a micro process. 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 decides whether or not to believe that this product or service will satisfy the need--a kind of “mental trial. She also feels that the unit’s size is small enough to easily fit into her beltpack.

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. Social Characteristics: Consumer innovators are more socially involved and socially accepted by others. Demographic Characteristics: The demographic characteristics of consumer innovators are: Young person Higher personal income More formal education Higher occupational status CONSUMER DECISION MAKING PROCESS: . Personality Traits: Consumer innovators are Less dogmatic: approach new product with openness. Inner-directed: they rely on their own values and standards while making decision High optimum stimulation level: individuals who seek unusual experience. 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. Media Habits: Consumer innovators are less likely to watch TV. Need for uniqueness: they feel to be seen unique by using new products. Variety seeking: they are brand switcher and try new products. They used to read special interest magazines. Interest in the Product Category: Consumer innovators are more interested in the product category because they are the early purchaser of the new product.

Steps in consumer decision making process are: Need recognition Search for information Pre .purchase evaluation of alternatives Purchase Consumption Post purchase evaluation Disinvestments .

Lindquist – Pg. Limitations: The flow is incomplete in its treatment of numerous factors internal to the consumers. The consumers search for and evaluation of the firms output and other available attributes. He says the act of purchase itself is more complex decision process.no:605] NICOSIA MODEL: Francesco Nicosia formulated this model. The fields are components are: The firm’s attributes and outputs or communications and the consumers psychological attributes. D. This model focus on conscious and deliberate decision making behaviour. . The consumers motivated act of purchase.MODELS OF CONSUMER DECISION PROCESS: [shopper. The consumers storage or use of the product. buyer and consumer behaviour – Jay.

Hypothetical constructs: The perceptual constructs are: Sensitivity to information: the degree to which the buyer regulates the stimulus information flow. Social stimuli: these are generated by social environment including family and groups. Search for information: active seeking of information about brands. Attitude: the buyer evaluation of particular brand potential to satisfy his motives. Decision mediators: the buyers’ mental rule of matching and ranking purchase alternatives according to his motives. HOWARD-SHETH MODEL: This model depicts rational brand choice behaviour by buyer under conditions of incomplete information and limited abilities. Output variables: Attention: the magnitude of the buyers information intake. Comprehension: the buyers’ store of information about a brand. Symbolic stimuli: producers representing their products in symbolic form such as in ad generate these. . Perceptual bias: distorting or altering information. Purchase behaviour: the actual purchase act. Brand potential of the evoked set: the buyer perception that the brand in the evoked set will satisfy his needs. The learning constructs are: Motive: general or specific goals impelling action.Assumption that consumer begins the decision process with no predisposition regarding involved firms is restricting. Satisfaction Exogenous variables: These are not well defined as they are external to buyers. 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. Limitations: No sharp distinction between exogenous and other variables. Intension: the buyers forecast of which brand he will buy. Inhibitors: environmental factors such as price which restrain purchase of a preferred brand.

D. Post purchase behaviour analysis helps the marketer to improve products or services. Loyalty: a consumer’s feeling of commitment to a product.no:110] Post purchase behaviour is the behaviour of the consumers after purchasing a product. design better promotion strategy.Lindquist – Pg. POST PURCHASE BEHAVIOUR: [shopper. This behaviour can be: Positive post purchase behaviour. etc. This model is complex. marketers or outlet that results in high level of repeat purchase or visits.Some variables are not well defined and difficult to measure. brand. Kollat and Blackwell. 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 role of motives in influencing behaviour is also vague. 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. This model is mechanistic in its treatment of decision process. Consumer loyalty gains repeat purchase and it helps in the formation of purchase habits. buyer and consumer behaviour – Jay. Negative post purchase behaviour. 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. Positive post purchase behaviour: When the consumer is satisfied with the product the positive outcome is gaining customer loyalty. Limitations: The role of some variables are vague. ENGEL-KOLLAT MODEL: This model is developed in 1968 by Engel. Analyzing the post purchase behaviour is important because it has an impact on future sales. .

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

If a product falls short of expectations the consumer is likely to be dissatisfied Expectations reflect anticipated behavior. 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. satisfaction and dissatisfaction. lead to post-purchase satisfaction. Satisfaction Expectation Perceived Performance Dissatisfaction . The four main constructs in the model are: expectations.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. coupled with perceived performance. performance.

irrational facts or brain washing. Dissatisfaction with the quality of goods and services: the quality of the product is below their expected level. Roots of consumerism/ problems that underlie consumer moments: Disillusionment with the system: consumers feel their bargaining position is weakening.UNIT – V ADDITIONAL DIMENSIONS CONSUMERISM: Definition: Consumerism is defined as social force designed to protect consumers interests in the marketplace by organizing and exerting consumer pressure on business. . Anti-advertisement attitude: Ads are sometimes the source of unrealistic information. Fall in standard of living: the real purchasing power of the consumers is getting eroded. Consumer information gap: because of time pressure consumers are not able to collect information so they fail to consume the best.

Motive of consumerism: To make the consumers aware of their rights and unite them into one force. adulteration. 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. The producers exploit ignorant and uneducated consumers.Uncooperative marketing institution: withholding of information from consumers and dealing in impersonal way results in the feeling that marketers are uncooperative. To fight against anti-social practice like black market. It strike a balance in the buyer-seller relation. 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. Consumers sometimes will not exercise their rights because of their fear in legal proceedings. hoarding. To effectively implement consumer protection law. etc. Sometimes producers increase the demand by restricting the supply so they are able to push up the price. 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. To check unfair trade practices like monopoly power and fight against exploitation. To educate the consumers with latest and complete information. Consumer protection means protecting the consumers from the evils of marketing. . Producers should pay attention to consumer rights and they should supply quality product at reasonable price.

speedy and inexpensive redressal machinery Convenient procedure Covers goods and services Time-limits . Who can file a complaint? A consumer or any voluntary organization or the government. The features of the act are: Social welfare legislation Effective provisions and safeguards Special consumer courts Simple.Government: Government protects the consumer against exploitation through its interventions. replacement of goods or refund the price. speedy and inexpensive redressal of grievances. What constitutes a complaint? A complaint in writing should state whether one have suffered a loss due to unfair trade practices. public or cooperative sectors. Extend and coverage of the act: The act applies to all goods and services whether in private. Consumer protection act 1986: This act was enacted to promote and protect the rights of the consumers. Consumers: Consumers should be aware of their rights and should raise voice against illegal practices. It provides for simple. Relief available to consumers: The redressal forum may gives order for removal of defects from goods. 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. 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.

Buying center roles: Primary roles – deciders and influencers Secondary roles – users. R & D: initial development of product and set board specification for components. 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. New task: This is most risky decision of buyer. Decision making unit[buying center]: Buying center is an informal.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. Manufacturing: responsible for determining the feasibility and economic consideration of producing end products. Buyer goes for first time purchase so take lot of time to decide about the purchase. impartation and processing of relevant purchasing related information. 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. 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 . Purchasing: they are negotiable experts dominant in straight rebuy. cross department decision unit in which the primary objective is the acquisition. 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.

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 .

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