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Marketing Management

By Philip, Kevin Lane Keller, Abraham Koshy, Mithileshwar Jha

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Chapter 6
Analyzing Consumer Markets

Since marketing starts from the customer, it is of primary importance to understand the
psyche of the customers and their buying motives. This chapter talks about the various
behavioural patterns that govern the decision making process of a customer. A
marketer needs to understand these factors affecting the customer’s purchase
decisions so as to design an appropriate marketing strategy.

Factors affecting Consumer Buying

1. Cultural Factors
a. Culture - Frames traditions, values, perceptions, preferences. E.g. Child
learning from family & surroundings.
b. Sub-culture - Provides more specific identification and socialization. Include
nationalities, religions, racial groups and geographic regions.
c. Social Class – Homogeneous and enduring divisions in a society which are
hierarchically ordered. Members share similar tastes and behaviour.
2. Social Factors
a. Reference Groups – Have direct or indirect influence on person’s attitude
and behaviour. Primary groups: regular interaction, e.g. family, friends,
neighbours. Secondary groups: religious, professional, trade union groups.
Aspirational Groups: ones that a person hopes to join. Dissociative groups:
whose values or behaviour and individual rejects.
b. Family – Family of orientation: parents and siblings. Acquires orientation
towards religion, politics and economics, sense of personal ambition, self
worth and love. Family of procreation: spouse and children. More direct
influence on buying behaviour.
c. Roles and Status – Role consists of activities a person is expected to
perform. Each role carries a status. Marketers must be aware of the status
symbol of each product.
Chapter 6 - Analyzing Consumer Markets

3. Personal Factors
a. Age and Stage in the Life Cycle – Tastes are age related. Markets should also
consider critical life events or transitions.
b. Occupation and Economic Circumstances – Economic Circumstances like
spendable income, savings, assets, debts, borrowing power etc affect
consumption patterns.
c. Personality and Self Concept – Personality, set of distinguishing
characteristics that influence his/her buying behaviour. Consumers match
brand personality with their ideal self concept instead of their actual self
d. Lifestyle and Values
4. Psychological Factors
a. Motivation: Freud’s theory of id, ego and super ego; Maslow’s need
hierarchy theory; Herzberg’s two factor model.
b. Perception: Process by which we select, organize and interpret information
inputs. In marketing, perceptions are more important than reality.
c. Learning – Induces changes in behaviour arising from experience. Marketers
can build demand by associating the product with positive drives.
d. Memory – Short term and long term memory. Build brand knowledge and
brand recall as node in memory.

Problem Information Evaluation of Purchase Postpurchase

Recogniton Search Alternatives Decision Behaviour

The Buying Decision Process

• Problem Recognition - Customer recognises a need triggered by internal or
external stimuli. Marketers need to identify circumstances that trigger needs.
• Information Search - Two levels of involvement – Heightened attention when
person becomes more receptive to information about the product. At next level
consumer may enter into active information search, looking for reading
material, phoning friends etc.
• Evaluation of Alternatives - Factors influencing a particular choice over the
other include attitudes, beliefs and expectancy value.
• Purchase Decision - Between purchase intention and purchase decision, 2
intervening factors come into play- Attitudes of others and Unanticipated
situational factors. Marketers should understand that these factors provoke risk
and should provide information to reduce it.
• Post purchase Behaviour - Marketers must monitor postpurchase satisfaction,
postpurchase actions, and postpurchase product uses.
Chapter 6 - Analyzing Consumer Markets
Level of customer involvement
High Low

Differences in Brands
Buying Variety Seeking

Insignificant Dissonance Habitual


1. Complex Buying Behaviour: When a customer purchases something for the

first time.
2. Variety Seeking: Consumers will keep switching varieties just out of
boredom. Eg- Biscuits. Marketer should keep introducing new products and
display the product prominently.
3. Habitual: Buying the same thing out of habit and not out of loyalty.
Distribution network should be excellent in this case. Maintain consistency
in product and advertising.
4. Dissonance Reducing: In case of repeat purchase of same product.