Module-1

Consumer Behaviour: Consumer Behavior is the Process Involved When

Individuals or Groups Select, Use, or Dispose of Products, Services, Ideas or Experiences (Exchange) to Satisfy Needs and Desires. Issues During Stages in the Consumption Process

Consumers’ Impact on Marketing Strategy • Understanding consumer behavior is good business. – – • – Firms exist to satisfy consumers’ needs, so Firms must understand consumers’ needs to satisfy them. Identifies Groups of Consumers Who are Similar to One Another in One or More Ways, and

The Process of Marketing Segmentation:

Devises Marketing Strategies that Appeal to One or More of These Groups.

Segmenting Consumers by Demographic Dimensions: Demographics are Statistics That Measure Observable Aspects of a Population Such As:

Consumers’ Impact on Marketing Strategy: Building Bonds with Consumers • Relationship Marketing occurs when a company makes an effort to interact with customers on a regular basis, and gives them reasons to maintain a bond with the company over time. • Database Marketing involves tracking consumers’ buying habits very closely, and crafting products and messages tailored precisely to people’s wants and needs based on this information. Marketing’s Impact on Consumers: The Meaning of Consumption

Marketing’s Impact on Consumers: Consumption Typology Consumption Typology Explores the Different Ways That Product and Experiences Can Provide Meaning to People. There Are 4 Distinct Types of Consumption Activities:

Marketing’s Impact on Consumers – – – – Marketing and Culture • Popular Culture Intangible and Tangible Objects The Global Consumer • • Global Consumer Culture Business to Consumer Selling (B2C Commerce) Virtual Consumption

• • –

Consumer to Consumer Selling (B2B Commerce) Virtual Brand Communities

Blurred Boundaries: Marketing and Reality

Concept and Need for studying CB • • • • • • • Who buys products or services? How do they buy products or services? Where do they buy them? How often do they buy them? When do they buy them? Why do they buy them? How often do they use them?

Consumer decision making • • • • Decision making (information search, consider brand alternatives) Habit ( little or no information search , considers only one brand) Consumers behavior includes post purchase satisfaction or dissatisfaction behavior Two types of customers- personal and organizational consumer

Factors influencing purchase decision

Who is interested in the study of CB • • All firms The new customer-Customer driven rewards-Customer driven goals-Customer driven strategy- Customer driven vision, mission and values

Development of CB as a field of study • • • • • Psychology-study of individuals Sociology – study of groups Socio-psychology –study of hoe people are influenced by groups Cultural anthropology- the influence of culture and society on the individual Economics-study of demand and supply

The Dark Side of Consumer Behavior

Interdisciplinary Influences

Two Perspective on Consumer Research The Wheel of Consumer Behavior .

Other Marketing Ethics Issues • – Do Marketers Create Artificial Needs? Response: Marketing attempts to create awareness that these needs do exist. if approached from an information dissemination perspective.the Standards Against Which Most People in a Culture Judge What is Right and What is Wrong. History of Consumer Research • Extension of marketing research with more emphasis on consumer behavior aspects .Marketing Ethics Business Ethics are Rules of Conduct That Guide Actions in the Marketplace . rather than to create them. they do not have the ability to create miracles. Good or Bad. • – • – Are Advertising and Marketing Necessary? Response: Yes. Do Marketers Promise Miracles? Not if they are honest.

cannot be extended to larger population . Intrepretivism Positivism Helps predict CB Uses Quantitative research methods -experiments. survey techniques and observations Assumptions made-Consumers are rational decision makers. where in the researchers put themselves in the society under study so as to absorb all the implications of the cultural practices • • Semiotics – the study of symbols and their interpretations In. observation and survey techniques-quantitative data so statistical analysis carried out • Research technique.depth Interviews.Motivational research ( use of projective techniques and in-depth interviews)came to be used widely marketers and advertising agencies • • • • The effectiveness of Motivational research method depends on highly trained personnel Use of a combination of Qualitative and Quantitative research techniques Another group of researchers – academicians interested in the consumer experiences Ethnography –related to cultural anthropology.• • Two reasons for studying CB-why consumers made the purchase decisions and how consumers would react to promotional messages Modernist era –positivists researchers conducted research studies adopting methods of experimenting. Semiotics. engaged in information processing. problem solvers.method where the questions are asked to obtain a gainful insight into the understanding of CB Positivism vs. in-depth interviews The cause and effect behavior.can extend research finding to large population Intrepretivism Understanding consumption practices of consumers Use of qualitative methods of research – ethnography.

the potential customers and what is consumer satisfaction level in products and services CONSUMER BEHAVOUR PROCESS(Consumer Research Process) Secondary data • • • Internal source External source Books & Periodicals Primary data .Value of Consumer Research • • • Provides information on how the consumers are behaving at the market place Identify future consumer needs or marketing opportunities Gives answers to what is the current consumer trend in the market.

Ice cream----.types of two wheeler) select any of three think of a phrase in which two are different from the third) Consumer Behavior Models • • • • • Economic Model Learning Model Psychoanalytic Model Sociological Model Howard Sheth Model Psychoanalytic Model . Watch----.• • • Depth interviews Focus groups Projective techniques.Respondents are asked to describe a third person about whom they have little information.to understand a persons hidden attitudes. motivation and feelings Project Techniques • Word Association –respondents are presented with a series of words or phrases ask what comes first to their mind-Toothpaste---Coffee----.Soft drink----.whether desirable or undesirable word • Sentence completion-The beginning of the sentence is read out to the respondent and asked to complete it (People who don’t drink arieted drinks are------) • Third person technique.to check attitudes about the respondent • • Role Playing Thematic Apperception Test (TAT)-Under this technique the respondents are shown an ambiguous picture or drawing or fill in a blank ‘speech buble’ associated with a particular character or a ambiguous situation and then ask to interpret it • Repertory Grid ( Rep Grid)—Respondents are presented with a grid and asked to title the columns with brand names types of a particular product( tastes of soft drink.

Personality is an outcome of • • • Id. Availability) . Brand comprehension. Price. member of a informal cultural organisation Howard Sheth model Objective • • It reflects how complex the whole question of CB is To provide the framework for including various concepts like learning. Intention. Distinctiveness in service.family members. employee. Choice criteria.the source of all psychic energy which drives us as action Super ego-the internal representation of what is approved by the society Ego. Social( Family. attitudes which play a role in influencing CB  Input –Stimulus display –Significant and Symbolic( Quality. Attitude.the conscious directing id directing id impulses to find gratification in a socially accepted manner Sociological Model • • Individual buyer is part of the institution called society Formal / Informal associations. Attention . Social class. perception. Satisfaction  Output-Social/ Organizational setting. Stimulus Ambiguity. Reference.Perceptual Bias)  Learning constructs-Confidence. Purchasing power/ financial status MODULE-2 Segmentation . Social class)  Perceptual constructs.Overt search. Culture. Motives.

Attitude. Need for Segmentation  Michael Porter “ The competitive advantage of a firm lies in being everything to a select few”  To be everything to everyone is a sure recipe for a strategic failure  Helps the firm compete in a highly competitive market Segmenting Consumers by Demographic Dimensions Demographics are Statistics That Measure Observable Aspects of a Population Such As: MARKET SEGMENTATION  Individual Preference ( Motivation. Beliefs. appreciating the fact that the market is a heterogeneous one. It is the Process of dividing a heterogeneous market into homogeneous sub units.  The company can either launch a products . Values)  Family &Peer pressure  Social acceptance . Knowledge.

 Education  Early experiences  Other environmental influences Advantages of Market Segmentation  Tap the market effectively  Preference of place of purchase for customers  Identify and find out additional benefit desired by the people  The Willingness to pay for the additional benefit desired by the people  Source or place from where consumers would like to buy  Give consumer value  Develop a distribution strategy  Develop a suitable pricing strategy  Usage of database marketing  Planning marketing activities around the customer  Marketing efforts are more efficient and economical  Increases productivity Criticisms of segmentation  Markets are not made up of segments with different wants because buyers of one brand buy other brands as well  Buyers often choose from a list of acceptable brands  Brands may differ in product form yet differ widely in market share Criteria for selecting a market segment  Identification  Measurability  Accessibility  Substantiality  Stability .

Quality. teens market. Life style. user status. aware. Income level. middleaged . Brand loyalty. Price. Economy. Education. Occupation  Psychographic Segmentation. higher income Gender –Female /Male Occupation – Professional. Religion.unaware. Housewives Education Marital Status Family size and structure Psychographic Variables  Personality & Life styles  Brand personality is a direct outcome of the usage of psychographic variables in formulating marketing strategies How to segment  3 stages . interested. youth market . upper middle income.student .seniormarket Income –Low income . low middle income. Rural) and climate  Demographic Segmentation.Age. Gender. child market 1-12yrs. self employed . Personality  Use-related Segmentation. Density( Urban. informed. service  Behaviouristic Segmentation – Buyer readiness stage. positive intention to buy  Geographic Location of Customers  Demographic Characteristics– – – – – – – Age –Infant. adolescent market.Social class. Business. Occasion or usage situation  Benefit Segmentation – Benefit Sought.Bases for segmenting consumer markets  Geographic Segmentation-Region. middle income. desirous.Usage rate.

attitudes. Cluster analysis is now used to cluster customer into different groups  Profiling Stage. & behavior 2) Based on the focus group a questionnaire is administered to the sample group Objective of Questionnaire  Attributes sought in a product & their priority ratings  Brand awareness & rating of different of different brands  Product usage patterns  Customer attitudes towards the generic product or product category itself  Demographics. behavior and consumption habits .Each cluster is profiled in terms of demographics .factor analysis is used to identify factors that differentiate customer groups. attitudes. Goals  Emotional Versus Rational Motives  Positive Motivation-If an individual experiences a driving force towards an object /person or situation .2 parts -1) Focus group discussions & in-depth interviews to get consumer motivation. Drives. Survey stage. psychographics & media habits of sample respondents  Analysis Stage. psychographics. media habits. The marketer can give each segment a name based on a dominant distinguishing characteristic Requirements for Effective Segmentation:  Accessibility  Measurability  Viable  Intensity in Competition Motivation  Needs.

Projection blame( putting blame ) Theories of Needs:  Maslow’s Hierarchy of Needs  Henry Murray’s List of Psychogenic Needs  Mc Clelland's Theory of Need Achievement. Needs for Affiliation. social and cultural norms and values . Emotional. Negative Motivation. accessibility of goal and self image  An individual’s behavior towards reaching out to goals is very often influenced by his expectation of success and failure as well as his past experience  Frustration is the feeling experienced by an individual when he/she fails to achieve a goal  Frustration mechanism-Aggression. Withdrawal. Regression.Driving force compelling the person to move away from someone or something  Hull’s drive reduction theory attempts to explain both motivation and learning is a popular theory which links needs.Needs for Power. Exterior or Environmental)  Goals and selection of Goals –Selection by an individual will depend on a number of factors such as personal experience. Cognitive. Rationalization or compromise. drives and goals Needs & Goals:  Physiological needs(primary needs)  Learned (Secondary or Cultural )Needs  Needs Arousal –Types of Stimulus (Physiological . Needs for Achievement Maslow’s Hierarchy of Needs: . personal norms and values. physical and intellectual capacity.

2. List of Psychogenic Needs The following is a partial list of 24 needs identified by Murray and his colleagues. such as the need for oxygen. According to Murray. all people have these needs. According to Murray. Murray described a needs as a. presses. and needs. such as the need for nurturing. these psychogenic needs function mostly on the unconscious level. but play a major role in our personality. accomplishment. and achievement. Primary Needs Primary needs are based upon biological demands. Theories of personality based upon needs and motives suggest that our personalities are a reflection of behaviors controlled by needs. Secondary Needs Secondary needs are generally psychological. . Murray's Types of Needs Murray identified needs as one of two types: 1. "potentiality or readiness to respond in a certain way under certain given circumstances" (1938). While some needs are temporary and changing. and overcoming obstacles. 1. and water. Ambition Needs • Achievement: Success. independence. other needs are more deeply seated in our nature. but each individual tends to have a certain level of each need.Henry Murray Pshycogenic Needs American psychologist Henry Murray (1893-1988) developed a theory of personality that was organized in terms of motives. food.

family.• • Exhibition: Shocking or thrilling other people. 5. and can conflict with other needs. 4. Succorance: Being helped or protected by others. Murray also believed that environmental factors play a role in how these psychogenic needs are displayed in behavior. Dominance: Controlling others. Construction: Creating things. Power Needs • • • • • • Abasement: Confessing and apologizing. Materialistic Needs • • • • Acquisition: Obtaining things. For example." Research on Psychogenic Needs Other psychologists have subjected Murray's psychogenic needs to considerable research. Recognition: Displaying achievements and gaining social status. Autonomy: Independence and resistance. Rejection: Rejecting other people. Information Needs • • Cognizance: Seeking knowledge and asking questions. Studies on the need for affiliation have found that people who rate high on . Affection Needs • • • • • Affiliation: Spending time with other people. but Murray also believed that needs can be interrelated. Deference: Obeying and cooperating with others. Blame Avoidance: Following the rules and avoiding blame. the need for dominance may conflict with the need for affiliation when overly controlling behavior drives away friends. Order: Making things neat and organized. Play: Having fun with others. Retention: Keeping things. For example. research on the need for achievement has revealed that people with a high need for achievement tend to select more challenging tasks. 2. Exposition: Education others. 3. Influences on Psychogenic Needs Each need is important in and of itself. can support other needs. Nurturance: Taking care of another person. Murray called these environmental forces "presses. and romantic partners. Aggression: Attacking or ridiculing others.

both in terms of being motivated. His ideas have since been widely adopted in many organisations. from 1987 until his death. the need for achievement (n-ach) The n-ach person is 'achievement motivated' and therefore seeks achievement. and relate closely to the theory ofFrederick Herzberg. including a spell at Harvard from 1956. advocating competency-based assessments and tests. and in the management and motivation others. developing achievement-based motivational theory and models. and a need for a sense of accomplishment. helping industry assess and train staff. The Achieving Society: • • • achievement motivation (n-ach) authority/power motivation (n-pow) affiliation motivation (n-affil) david mcclelland's needs-based motivational model These needs are found to varying degrees in all workers and managers. There is a strong need for feedback as to achievement and progress. and this mix of motivational needs characterises a person's or manager's style and behaviour. and more likely to suffer loneliness when faced with little social contact. the need for authority and power (n-pow) The n-pow person is 'authority motivated'. There is also motivation and need towards increasing personal status and prestige. McClelland is chiefly known for his work on achievement motivation. and later taught at Boston University. and promoted improvements in employee assessment methods. There is a strong need to lead and for their ideas to prevail. David C Mcclelland's Motivational Needs Theory American David Clarence McClelland (1917-98) achieved his doctorate in psychology at Yale in 1941 and became professor at Wesleyan University. David McClelland pioneered workplace motivational thinking. and advancement in the job. spend more time in social interaction. . He then taught and lectured. effective and to make an impact. attainment of realistic but challenging goals. He began his McBer consultancy in 1963. arguing them to be better than traditional IQ and personality-based tests. but his research interests extended to personality and consciousness.affiliation needs tend to have larger social groups. This driver produces a need to be influential. David McClelland is most noted for describing three types of motivational need. which he identified in his 1961 book. where with colleagues for twenty years he studied particularly motivation and the achievement need.

Positive motivation induces people to do work in the best possible manner and to improve their performance. Under this better facilities and rewards are provided for their better performance.the need for affiliation (n-affil) The n-affil person is 'affiliation motivated'. These people are team players. and has a need for friendly relationships and is motivated towards interaction with other people.Soft drink----. Negative motivation . Motivation may be of two types: § § Positive Negative Positive motivation In real sense.to check attitudes about the respondent  Role Playing Positive and Negative Motivation Motivation is concerned with inspiring the man to work to get the best result. The affiliation driver produces motivation and need to be liked and held in popular regard. Ice cream----. Watch----. Motivational Research 1)Depth Interviews 2)Project Techniques  Word Association –respondents are presented with a series of words or phrases ask what comes first to their mind-Toothpaste---Coffee----. motivation means positive motivation.Respondents are asked to describe a third person about whom they have little information.whether desirable or undesirable word  Sentence completion-The beginning of the sentence is read out to the respondent and asked to complete it (People who don’t drink arieted drinks are------)  Third person technique. Such rewards and facilities may be financial and non-financial.

There are two approaches that buying motives can make toward the customer. which he has to suffer for lack of good performance. Both positive and negative motivation aim at inspiring the will of the people to work but they differ in their approaches. Rational buying motives usually appeal to the consumer's reason or better judgment. Some emotional motives include: * A romantic desire to attract the opposite sex Rational buying motives • Economy of purchase • Economy of use • Efficient profits • Increased profits • Durability • Accurate performance • Labour-saving • Time-saving • Simple construction • Simple operation • Ease of repair • Ease of installation • Space-saving • Increased production • Availability . Emotional reasons for buying products often involve little logic and usually stem more from the heart than the head. he should be punished. the other tries to induce the man by cutting their wages and other facilities and amenities on the belief that man works out of fear.Negative motivation aims at controlling the negative efforts of the work and seeks to create a sense of fear for the worker. These are emotional and rational motives. you can influence buying decisions by targeting your pitch toward particular buying motives. It is based on the concept that if a worker fails in achieving the desired results. Rational And Emotional Buying Motives Buying motives can be looked at as the way to approach prospects or a way to present the product to the prospect. Emotional motives prompt a prospect to act because of an appeal to some sentiment or passion. Once a person begins to fulfill psychological needs. Whereas one approaches the people to work in the best possible manner providing better monetary and non-monetary incentives.

Failure of need fulfillment may give rise to the following states: 1. people can’t fulfill some of their needs.Rationalisation – trying to justify the situation & excusing oneself. so also motivation. 2.Regression – trying to settle without that particular need & try something else.Withdrawal – trying to disassociate oneself from the very thought of it. The fact is that not all needs are satisfied fully. social & cultural limitations. When some are satisfied. Both internal & external factors are responsible for change.Complete servicing Good workmanship Low maintenance Thorough research Desire to be unique Curiosity Emotional buying motives • Pride of appearance • Pride of ownership • Desire for prestige • Desire for recognition • Desire to imitate • Desire for variety • Safety • Fear • Desire to create • Desire for security • Convenience • Desire to be unique • Curiosity • • • • • • Dynamic Nature of Motivation: Needs & their fulfillment are the basis of motivation needs change. some others arise. 3. 4.Aggression – getting angry & frustrated. The Measurement of motives The measurement of the motives is done on 3 ways . Sometimes because of personal. financial. wants & goals. and resorting to unsocial actions.

people process information important to the self in a selective manner (for instance. By doing this. hence increasing their levels of self-esteem. they work so as to reduce any uncertainty about their abilities or personality traits. To achieve this goal. Feedback is sought to increase the accuracy and objectivity of previously formed self-conceptions. by focusing on information that has favourable implications to the self and discarding information with unfavourable implications to the self). but also protecting the self from negative information (they search for positivity and avoid negativity) In order to do this. people get the sense of control and predictability in the social world. This is regardless of whether the new information confirms or challenges the previously existing self-conceptions Self-Verification The self-verification motive asserts that what motivates people to engage in the self-evaluation process is the desire to verify their pre-existing self-conceptions. aiming to make others see them as socially desirable. people seek to boost the positivityof the self or decrease its negativity.Self-Enhancement The self-enhancement motive states that people engage in self-evaluation in view of. Self-Assessment The self-assessment motive is based on the assumption that people want to have an accurate and objective evaluation of the self. not only improving the positivity of their self-conceptions. People also choose to compare themselves socially to others so as to be placed in a favourable position.By doing this. maintaining consistency between their previously formed self-conceptions and any new information that could be important to the self (feedback). Elements of Consumer Behavior .

Variables & Processes Inside Black Box Consumer Buying Process .

The Buyer Decision Process Module-3 Personality .

does not change Personality can change. Temperament. study.Horlicks( Sporty Personality) Properties of Personality • • • Personality reflects individual differences Personality is consistent and enduring. Needs. Interests.specific events can bring change in individual personality-marriage.made products Personality traits: Attitudes. promotion Theories of Personality • • • Trait Theory Psychoanalytical Theory (Freudian theory) Neo.Freudian Theory Trait Theory • • • Quantitative in nature & focuses on the measurement of certain specific characteristics or traits Marketers use personality traits to segment different markets Personality tests to measure consumer traits are Consumer Traits • • • • • Consumer innovativeness: To what extent a person is receptive to a new buying experience Consumer susceptibility to interpersonal influence (SUSCEP): To understand how consumers will respond to social influences Consumer materialism : To ascertain the extent to which consumer’s are attached to worldly material possessions Consumer ethnocentrism: CETSCALE the likelihood of consumer accepting rejecting foreign. .• • Patterns of Individual behavior which are consistent and enduring An Individual’s personality represents a set of characteristics to understand CB –Boost. Physiology. career. Aptitude . Morphology.

instinctive.emotional distance between themselves and others prefer independence. self reliance. internal monitor to balance the impulsive demands of the id and restraints put by the super ego. personify brands Neo.Psychoanalytical Theory (Freudian theory) • • • • • In-depth study of individual of personality Personality is an outcome of Id. Detached type Complaint type. self sufficiency Jung’s Personality Types .motivational research techniques –asking consumers to complete sentences. see others as competitors Detached.pictures. needs.Complaint type.relationship with other men Parent –child relationship Karen Horney. moral conscience Ego. Aggressive type.the conscious directing id directing id impulses to find gratification in a socially-Individual conscious control. -Brand Positioning and Brand Personality • • • Brand Positioning and Brand Personality Depth and Focus Group Interviews Projective Techniques.Freudian Theory • • • • • • • • • • Social relationship played a vital role in the formation and development of personality Freud’s colleagues who disagreed with Freud’s rigid adherence to consider only the basic biological or instinctive traits as determinants of personality Authors felt other reasons Strive for Superiority Inter.the source of all psychic energy which drives us as action.classified three personality groups. desires. basic. impulses that demand immediate gratification Super ego-the internal representation of what is approved by the societyInternal expression of societal values and ideals.desire to be included in activities of group.excel. want appreciation Aggressive.

Feeling (IF)  Takes a broader perspective of the situation or world  Considers various options for decision making  People oriented and subjective oriented in decision making  Least price conscious.Thinking(IT)  Takes a broader perspective of the situation and world  Thinks . Intuiting Few characteristics of Selected Jungian Personality types • Sensing.Thinking(ST)  Logical. thinking. empirical and rational  Risk avoider.speculative  Takes long term view while taking decisions • Sensing .empirical viewpoint  Makes decision after considering others – subjective orientation  Status conscious and materialism reflects the impact on other persons  Short term consideration in decision making • Intuitive.Feeling(SF)  Considers personal values rather than logic. feeling. uses logic and imagination in taking decisions  Considers many options while taking decisions. are venturesome and novelty seeking  The time period is indefinite while taking decisions .• • Grouped into 2 fundamental types-Extrovert & Introvert Mental operations into 4 fundamental activities-sensing. will search in depth for decision making information  Price sensitive and materialistic in considering motives  Short term consideration in decision making • Intuitive .

BT study • • • Tween Type 1-15.receive least pocket money parents buy them everything • Tween Type 4 -47.51% home birds with an active outside life.2% brash. big priced purchases Tween Type 2.38% highly involved in purchase of high priced products for home . not academically oriented and prone to tantrums. easy accepters of new products and services Gary and Starke have identified sixteen source personality traits Dogmatism • Is a personality trait which indicates degree of rigidity individuals display when confronted with something which is unfamiliar to them or towards information which is contrary to their own established beliefs. good at school and with a strong value system ingrained in them Personality Influences and Consumer Behavior • • • • • • Consumer Innovativeness Dogmatism Social character Need for uniqueness Optimum stimulation level Variety. receive pocket money. freedom of space. expresses views of their parents. do not care about most things nor do their parents have high expectations of them Tween Type 3 -25.11.novelty seeking Consumer Innovativeness • • Element of risk.8%quite. spoilt. traditionalist at heart. Those high in Dogmatism will decide on the worthiness of the products / services and those low on Dogmatism consider unfamiliar or opposing beliefs Optimum Stimulation level (OSL) .

standards and values Consumers who look for guidance –new products Need for Uniqueness • • Unique people Do not want to conform to other’s expectations or standards Cognitive Personality Traits • Visualizers Vs Verbalizers Stress on visual information and visual products CD/DVD while Verbalizers prefer verbal information on products –membership in books or magazine shops • Need for cognition –related to the individuals thinking process and measures a persons cravings for something.interested in model edorsing product Inter related consumption and possession personality traits .already using a product in a new or novel way Social Character • • • Personality trait depicts character closely related to socio.cultural environment Consumers rely on their own intuition.• • Display more willingness to take risks . be innovative OSL reflects a persons desire for the level of lifestyle stimulation Variety or Novelty Seeking • • • Exploratory purchase behavior.consumer obtains information about new alternatives and contemplates about the new option with caution and reservation Use innovativeness.exploring newer brands Vicarious exploration. try new products . the need for cognition helps on the creation of advertising messages with the right combination of colour mix.

between materialistic and addictive buying is fixated consumption. Possessions. experience.abnormal behaviour.People attached to material possessions . knowledge  Actual self image-How they actually see themselves  Ideal self image.• Consumer Materialism. actions out of control causing harm to them and people around them-liqour. characteristic observation  Undue importance to acquiring and displaying their worldly possessions  Crave for possessing lots of things  Self centered and selfish  Like to possess things irrespective of whether they derive greater happiness or satisfaction from possessing the same • Fixated Consumption Behaviour. behavior Unique-Background. interested in buying but enjoy displaying them and known for their involvement with others of same interest • • • • Very deep interest displayed for a particular object or product Dedicated search Willingness to spend a considerable amount Compulsive Consumption Behaviour. habits.addiction.affinity for USA made products Self Image • • Personality traits.How they would like to see themselves  Social self image-how they feel the society sees them  Ideal social self image-how they would like the society to see them  Expected self image-Their expectation of how they see themselves at some specified future time . drug addiction • • • Consumer Ethnocentrism Consumer’s response to foreign products Highly ethnocentric-khadi products Low ethnocentric.

jewellery. hair styles.Ideal self image and expected self image is of more importance to the marketerconsumer may be induced to buy products Extension of self image • • • • • • Motivate the individual to do things otherwise difficult for him.housewife operate a PC Through symbolic representation-bat with sachin signature By conferring status or rank By bestowing upon someone close and handing over a priced possession Firms marketing products /services related to cosmetics.other personal care products . smell and taste External factors • • • • • • Intensity and size Position Contrast Novelty Repetition Movement . membership to certain clubs. organizes and and interprets stimuli into a meaningful and coherent picture of the world No two individuals are alike Perception is based on each one’s needs . hearing. values and expectations Sensation/ Absolute Threshold • • Sensation is the immediate direct response of a physical sensory organ Physical senses are vision. beauty salons are working out marketing plans to help consumer gain inflated self image Consumer Perception • • • Perception is the process by which individual selects . touch.

Internal Factors influencing Attention • • Marketing Mix Brand Personality Perceptual Process • Perceptual Selection  Selective attention  Selective exposure  Selective perception  Perceptual vigilance and perceptual defense  Perceptual equilibrium and disequilibrium • Perceptual Organization  Grouping  Context • Perceptual Interpretation  Categorization  Inference Perceptual Distortion • • • • • • Personality/physical appearance Stereotypes Halo Effect Irrelevant Cues First Impression Hasty Conclusions Perceptual Inference .

Compare all the lists which are the common brands identified? Find out the reasons for the brand choice. does it match your answer Cognitive Personality Factors • Need for cognition (NC) – – • A person’s craving for enjoyment of thinking Individual with high NC more likely to respond to ads rich in product information Visualizers versus verbalizers – – A person’s preference for information presented visually or verbally Verbalizers prefer written information over graphics and images. From Consumer Materialism to Compulsive Consumption • • • Consumer materialism – – – The extent to which a person is considered “materialistic” Consumers fixated on certain products or categories of products “Addicted” or “out-of-control” consumers Fixated consumption behavior Compulsive consumption behavior .• • • Brands Outlets Association Consumer Imagery • Consumers have a number of enduring perceptions and images which are quite relevant to the study of consumer behavior gauging consumer mind is difficult Learning • Make a list of any 5 brands of product or services to which you feel you are loyal. Ask five other classmates to prepare a similar list.

4. 3. A real Indian should always buy Indian-made products. It is not right to purchase foreign products. 3. 6. Buy Indian made products. I cannot help but spend part or the whole of it. When I have money. while knowing I had very little money left. Purchasing foreign-made products is un-Indian. Consumer Ethnocentrism • • Ethnocentric consumers feel it is wrong to purchase foreign-made products They can be targeted by stressing nationalistic themes Items from the CETSCALE 1. 5. It is always best to purchase Indian products.Sample Items to Measure Compulsive Buying 1. I am one of those people who often responds to direct mail offers. 8. I am often impulsive in my buying behavior. I have an irresistible urge to go into a shop to buy something. because it puts Indians out of jobs. 4. As soon as I enter a shopping center. 2. I have often bought a product that I did not need. Keep Indian working. 5. 2. We should purchase products manufactured in India instead of letting other countries get rich off us. Indians should always buy Indian made products instead of imports. 7. Brand Personality • • Personality-like traits associated with brands Examples – – – Purdue and freshness Nike and athlete BMW is performance driven . Only those products that are unavailable in the India should be imported.

.– • Levi’s 501 jeans are dependable and rugged Brand personality which is strong and favorable will strengthen a brand but not necessarily demand a price premium A Brand Personality Framework Product Personality Issues • Gender – – • Often used for brand personalities Some product perceived as masculine (coffee and toothpaste) while others as feminine (bath soap and shampoo) Geography – – • Color – Color combinations in packaging and products denotes personality Actual locations like Philadelphia cream cheese and Arizona iced tea Fictitious names also used such as Hidden Valley and Bear Creek Marketers often use a fictitious location to help with personality.

Self and Self-Image • Consumers have a variety of enduring images of themselves .

image : Consumers use self-altering products to express individualism by • • • Creating new self Maintaining the existing self Extending the self . habits. relationships and way of behavior • • Developed through background. experience. skills.and interaction with others Consumers select products congruent with this image Extended self : Possessions can extend self in a number of ways: • • • • • Actually Symbolically Conferring status or rank Bestowing feelings of immortality Endowing with magical powers Altering the self. relationships and way of behavior Developed through background.and interaction with others Consumers select products congruent with this image • Marketers can target products to a particular “self” Makeup of the self-image: Contains traits. possessions.• These images are associated with personality in that individuals consumption relates to self-image The Marketing Concept Issues Related to Self and Self-Image • • One or multiple selves : A single consumer will act differently in different situations or with different people We have a variety of social roles: Contains traits. experience. habits. possessions. skills.

Operant or Instrumental Conditioning (consequences of behaviours can result in changes in the probability of it occurrence) .• Conforming ELEMENTS OF LEARNING PROCESS • • • • • • Drive Motivation Cues Response Re-inforcement Retention LEARNING THEORIES 1. Classical Conditioning (behaviours as a result of close association between a primary stimulus and a secondary stimulus) 2.

Cognitive Theory (emphasis is on the thought process involved in learning) 4. Re-inforcement / Repeat] Hierarchy] CONSUMER MEMORY  Short term memory .3. Low involvement theory (also known as the ATR [Awareness. Trial. Observational Learning (leaving based on imitating other’s behaviour) 5.

. Long term memory Learning process: HABIT  Define Habit  A model of habitual purchasing behaviour Perception To understand how consumer decision making process can be influenced by his or her perception of the product or brand .

attention and selective perception)  grouping. closure and context)  Categorization and Inference) .Factors influencing perception EXTERNAL AND INTERNAL FACTORS THE PERCEPTUAL PROCESS   The perceptual process involves three components: Perceptual Selection (The three processes which define selection Perceptual organization (The three basic principles used are Perceptual interpretation (Two principles are used are: exposure.

Ideal self image and expected self image)       Risk: CONCEPT OF PERCEIVED-RISK  Risk reduction strategies Adopted by consumer  Seek information  Continuing the same brand  Brand image  Store image  Buy the most expensive brand  Seek reassurance Memory  Two sources of product information:  External environment: packaging.Consumer Imagery and marketing implications  Consumer have a number of enduring perception or images which are quite relevant to the consumer behaviour study. POS displays. other marketing information  Memory: past experiences. prices. word-of-mouth. Social self image. labels.  Brand image Consumer over all perception of the brand. family preferences  Associative network of nodes (concepts) and links (connections) Consumer's perception of quality Consumer's price perceptions Advertising and perceived benefit Sales promotion and perceived value Public relation and perceived value Personal selling and perceived value . which to a certain extent could be influenced by product positioning) and self image of the consumer (which could include: actual self image.

. info retained for later completion)  Time (lapsed time since exposure) . Scripts: information organized in memory around different types of events or episodes (e.  Analyzing and assigning meaning. ad “clutter” issue)  Completeness of information (Zeigarnik Effect – if incomplete.  processing is shallow. information may be rehearsed to retain its meaning  Information rehearsed in ST memory is transmitted to long-term (LT) memory for storage and retrieval as needed. LT memory capacity is unlimited Information Retention  It refers to the amount of material previously learned that is remembered  Forgetting – the loss in retention of material previously learned  Retention affected by:  Incoming information  The person receiving the information Retention: Characteristics of Incoming Information and Processing  Repetition or rehearsal  Relevance  Competing information (new information competes with old. a restaurant script) How Information is Captured and Stored in Memory  Memory processing areas:  New information is initially captured in sensory memory.g. limited capacity to a finite number of chunks (units of memory). capacity is limited  Information is transmitted from sensory memory to short-term (ST)memory.

“Meaning-level processing” (“semantic”) implies analysis of meaning. How Information is Retrieved from Memory  Retrieval cues – “self-” or “externally-” generated (sensory images: sounds. Learning – Probability Theory  Learning à formation of habits formed and changed through experience with products or services . smells.)  Interference from competing cues (make cue to stand out)  Consumer’s state of mind: higher retrieval levels occur when info processing and retrieval mood and/or interest levels match Information Storage in Memory – Processing Effects Recall of numerically-coded information is better than verbal information “Surface-level processing” (“sensory”) occurs when there is no analysis of meaning. Consumer judgment error rate lower. colors. Consumer judgment error rate higher.etc. shapes. Mood (positive mood impact) How Retention is Influenced by the Information Recipient  Consumer familiarity or experience  Being more familiar with a product category increases the chances of remembering information about new or existing brands  Affects way information is organized in memory  Consumer motivation  Higher motivation to process info is positively related to doing so at deeper levels of memory and to retain info longer and more accurately.

. Strength of habit depends upon the amount of reinforcement it receives  Probability models are used to predict the formation of habits:  Brand loyalty  Brand acceptance  Brand switching  New product forecasting Learning – Behavior Analysis  The relationship between marketers and consumers often resembles a negotiation  Several behavior modification principles (BMPs) are used by marketers to induce consumers to buy their products and services.  Classical conditioning –learning results from a relationship between a stimulus and a response  Pavlov and his salivating dogs: a conditioned stimulus (the ringing bell before each feeding) results in a conditioned response (salivation)  Marketing applications  Higher order conditioning and celebrity advertising  Strength of the unconditioned stimulus  Number of pairings  Forward versus backward versus simultaneous conditioning  New versus existing products  Operant conditioning – a process in which the frequency of occurrence of a bit of behavior is modified by the consequences of the behavior 1. 5. Modeling – the process through which an individual learns a behavior by observing the behavior of others and the consequences of this behavior. Discrimination – the process through which consumers restrict their range of responses and attach themselves to a particular brand. Especially relevant in low involvement purchases 2. Generalization – the tendency to respond in similar ways to similar stimuli. 4. Rewards & punishments AND consumer behavior 3.

sound. processes.  Four stages:  Formulation of hypotheses (specific testable assumptions) about products or brands  Exposure to evidence (passive or active)  Encoding of the evidence  Integration of earlier hypotheses with new information into beliefs  Familiarity. ambiguity. smell. .Learning – Cognitive Theory  Emphasis is on thinking rather than the doing aspects of learning. motivation Cognitive Theory and Marketing  Strategies for market leaders (topdogs)  Reinforcement  Blocking  Explaining  Strategies for market underdogs  Disruption  Facilitating trial Perception  Perception is the way in which an individual gathers. touch. and taste  It focuses on product specific sense attributes and how these are understood and evaluated by consumers. and interprets information from the environment.  Two views of consumer perception  Sensory perception  Gestalt theory of perception Sensory Perception  It is governed by the five senses: sight.

coarse. bitter. and unity  Individual response factors: cognitive set interest. etc. position. and floral  Tactile cues: soft. shape. salty. intensity. size. tempo. and size  Aural cues: tempo and pitch  Olfactory cues (taste + smell): sweet. bordering for ads or displays while really the same Factors Influencing Gestalt Perception  Stimulus factors: color and contrast. actual/illusion of motion. needs.Factors Affecting Sensory Perception  Stimulus factors (examples)  Visual cues: color. values. the “limin”  Sensory preferences: sensory product features are perceived and evaluated based on those liked or disliked  Consumer expectation: affects how product features are likely to be perceived/evaluated. isolation. When features match expectations this yields more positive preference outcomes Gestalt Theory of Perception  Gestalt principle: the whole adds up to more than the sum of its parts  People perceive “form” above all else  The form may remain constant even though some specific features of it may change (color. and .) – “variations on the same theme”  Applications: size. and silky  Individual Response Factors  Sensory acuity: the capacity to recognize and differentiate among certain sensory cues. involvement.

versatility. and prestige  Perceived high quality à product satisfaction Risk Perception/Risk Reduction  It refers to a perceptual process and behavior outcomes generated from the perception of risk in the purchase or a product or service  Components of risk:  Severity of consequences (how bad will it be) . durability.How consumers Interpret Perceptions?  Categorization: the psychological process through which a consumer compares the perception of a product with a mental representation of that product in memory. performance.  Analytic versus non-analytic (meeting or not meeting required attributes to “fit”)  Marketing implications for new products or innovations Consumer Attributions  It refers to the process through which people connect events and behavior with causes.  Forms of attribution  Product perception (a product problem)  Self-perception (questioning oneself)  Person perception (questioning others motives) Perceptions of Product/Service Quality  Perceived quality – a perceptual outcome generated from processing product or service features (benefits delivered) that leads the consumer to make inferences about the quality of that product or service  Dimensions of perceived quality for durable goods: ease of use. serviceability.

 Price perceptions and the social judgment theory – “regions”  “Assimilation” (acceptable) and “contrast” (too high or low) Perceived Value  The trade-off between product benefits and product costs. Perceived value = perceived benefits / perceived costs MODULE-5 Basic Communication Model Elements of the Communications Process • • • The Message Initiator (the Source) The Sender The Receiver . Uncertainty related to those consequences (what are the chances the consequence will occur)  Risk reduction strategies: behaviors to reduce their perception of risk in purchase situations Price Perception  Consumers perceive a price as either high or low on the basis of a comparison with an internal price (or referent price).

• • • • The Medium The Message The Target Audience (the Receivers) Feedback .the Receiver’s Response Issues in Credibility • • • • Credibility of Informal Sources Credibility of Formal Sources Credibility of Spokespersons and Endorsers Message Credibility Endorser Credibility • • • • Endorser credibility is important when message comprehension is low Match must exist between product attributes and endorser attributes Credibility is higher when endorser’s demographic characteristics are similar to those of target audience Endorser credibility is not a substitute for corporate credibility Barriers to Communication • Selective Perception – – • Wandering. Zapping. Zipping. and Channel Surfing Combat with Roadblocking Psychological Noise .

– Combat with repeated exposures. and teasers Comprehensive Communication Model Issues in Designing Persuasive Communications • • • Communications strategy Media strategy Message strategy Communications Strategy Perception/ Experience/ Memory Model of Advertising . contrast in the copy.

Buyer Personalities and Advertising Strategies Involvement Theory and Persuasion The Elaboration Likelihood Model (ELM) proposes that marketers use the •central route to persuasion for high involvement products and the •peripheral route to persuasion for low involvement products Issues in Message Presentation .Media Strategy • • Consumer profiles Audience profiles A cost-effective media choice is one that closely matches the advertiser’s consumer profile with the medium’s audience profile.

Audience demographic factors affect the response to humorous advertising appeals.causing reinforcement Message Framing One-sided Versus Two-sided Messages Comparative Advertising Order Effects Repetition Two-Sided Appeal Emotional Advertising Appeals: Fear. Humor that is relevant to the product is superior to humor that is unrelated to the product. Humor does not enhance source credibility. Humor is more effective with existing products than with new products. Humor enhances liking. The nature of the product affects the appropriateness of a humorous treatment. Humor. Abrasive advertising. Humor is not more effective at increasing persuasion. Audience participation IMPACT OF HUMOR ON ADVERTISING • • • • • • • • • • Humor attracts attention. Humor is more appropriate for low-involvement products and feeling-oriented products than for high-involvement products.• • • • • • Resonance-continuing to sound and ring . Humor does not harm comprehension. .

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