LEARNING OBJECTIVES

P
1. Define the consumer market and construct a simple model of
consumer buyer behavior.
2. Name the four major factors that influence consumer buyer
behavior.
3. List and define the major types of buying decision behavior and the
stages in the buyer decision process.
4. Describe the adoption and diffusion process for new products.

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REVISION…

 Definition of a market
P
 The set of all actual and potential buyers
of a product or service.
 These buyers share a particular need or want that
can be satisfied through exchange relationships.

(Sellers) = Industry

(Buyers) = Market  Customers

3
REVISION…

 Classification of markets
P
Consumers

MARKET Businesses

Organizations NGOs/NPOs

Institutions and
Governments

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1. OVERVIEW OF CONSUMER BEHAVIOR

 Consumer market
P
 All the individuals and households that buy or acquire goods and
services for personal consumption.
 Characteristics of consumer market
 Size
 Buying in small quantities
 Scattered geographically
 Vary in age, income, education level, tastes, etc.
 Vary in needs, wants, purchasing power, etc.

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2. MODEL OF CONSUMER BEHAVIOR
Model of Buyer Behavior
P
The environment Buyer’s black box Buyer responses

Marketing  Buying attitudes and

stimuli Other  BUYER’S preferences
CHARACTERISTICS
 Product  Economic  Purchase behavior:
 Price  Technological What? When? Where?
 BUYER’S DECISION How much?
 Place  Social PROCESS  Brand engagements and
 Promotion  Cultural
relationships

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3. CHARACTERISTICS AFFECTING CONSUMER
BEHAVIOUR P
CULTURAL
SOCIAL
PERSONAL PSYCHOLOGICAL
Culture Groups and Age and lifecycle
stage Motivation
social networks
Sub – culture Occupation Perception CONSUMERS
Economic Learning
Family
Social class situation Beliefs and
Lifestyle attitudes
Roles and status
Personality and
self-concept

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a. Cultural factors

 Culture
P
 The set of basic values, perceptions, wants, and
behaviors learned by a member of society from
family and other important institutions.

 Culture is the most basic cause of a person’s wants

and behavior.

Cultural shifts

8
Cultural factors
Cultural shifts
P

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Cultural factors

 Subculture
P
 A group of people with shared value systems
based on common life experiences and situations.
nationality
race
Geographical
Age
region
Gender
Social class

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Cultural factors

 Social class
P
 Relatively permanent and ordered divisions in a
society whose members share similar values, interests,
and behaviors.
 People within a given social class tend to exhibit
similar buying behavior.
 Measurement of social classes:
 Social class is determined as a combination of
occupation, income, education, wealth, and other
variables.
 Social class mobility

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 P
The major social classes:

• Upper class
• Middle class
• Working class
• Lower class

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b. Social factors

 Group
P
 Two or more people who interact to accomplish
individual or mutual goals.

Membership group Reference group Aspirational group

-----------------------
Groups that have a direct
influence and to which a
person belongs.
----------------------- -----------------------
Groups serve as direct (face- Groups to which the
to-face interactions) or individual wishes
indirect points of to belong.
comparison or reference in
forming a person’s attitudes
or behavior.

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Social factors

 Group
P
 Opinion leader
• A person within a reference group who,
because of special skills, knowledge,
personality, or other characteristics, exerts
social influence on others.
• Some experts call this group the influentials
or leading adopters.
 Word-of-mouth influence
 Buzz marketing

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 Social factors
 Social network
 Online social communities—blogs, online social media,
P
brand communities, and other online forums—where
people socialize or exchange information and
opinions.
 Categories:
• Blogs (Engadget, Gizmodo, Wordpress)
• Message boards (Craigslist)
• Social media sites (Facebook, Twitter, YouTube,
Instagram, Snapchat, LinkedIn)
• Communal shopping sites (Lazada, Shopee)
 Characteristics:
• Interactivity vs. Controllability

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 Social factors

 Family
P
 The most important consumer buying
organization in society
 Husband–wife involvement varies widely by
product category and by stage in the
buying process.

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Social factors

 Role
P
 A role consists of the activities people are expected to
perform according to the people around them.
 Status
 Each role carries a status reflecting the general esteem
given to it by society.

People usually choose products appropriate to

their roles and status.

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c. Personal factors

 Age
P
 Tastes in food, clothes, furniture, and recreation are often age related.
 Life-cycle stage
 The stages through which families might pass as they mature over time
 Changes as a result of demographics and life-changing events—marriage,
having children, purchasing a home, divorce, children going to college,
changes in personal income, moving out of the house, and retirement.
 Occupation
 Economic situation
 Spending, personal income, savings, and interest rates

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Personal factors
 Lifestyle
P
 A person’s pattern of living as expressed in his or her activities,
interests, and opinions.
 Consumers buy the values and lifestyles those products represent.
 Consumers’ AIO dimensions

Activities Interests Opinions

----------------------- ----------------------- -----------------------
Work, hobbies, Food, fashion, family, About themselves,
shopping, sports, social recreation social issues, business,
events products

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Personal factors

 Personality
P
 The unique psychological characteristics that
distinguish a person or group.
 Personality is usually described in terms of traits such
as self-confidence, dominance, sociability, autonomy,
defensiveness, adaptability, and aggressiveness.
 Myers-Briggs Type Indicator
• http://aroma.vn/mbti/
• http://mbti.toppion.com/
• http://infocus.edu.vn/mbti
• http://www.mbti.vn/trac-nghiem-truc-tuyen/

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Personal factors

 Brand personality
P
 Specific mix of human traits that may be attributed to
a particular brand.
Sincerity Excitement Competence Sophistication Ruggedness

Down-to-earth Daring Reliable Upper class Outdoorsy

Honest Spirited Intelligent Charming Tough

Wholesome Imaginative Successful Glamorous Masculine

Cheerful Up-to-date Hard-working Feminine Western

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Personal factors
 Self-concept/ Self-image
P
 People’s possessions contribute to and reflect their identities—that
is, “we are what we consume.”

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d. Psychological factors

 Motive (Drive)
P
 A need that is sufficiently pressing to direct the person to seek
satisfaction of the need.

 Theories of human motivation

 Theory of Sigmund Freud
 Theory of Abraham Maslow

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Psychological factors

 Motivation
P
 Theory of Sigmund Freud
• People are largely unconscious about the real psychological
forces shaping their behavior.
• A person’s buying decisions are affected by subconscious
motives or desires that even the buyer may not fully
understand.

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Psychological factors

 Motivation
P
 Abraham Maslow’s Hierarchy of Needs

Self-actualization needs Self-development and realization

Esteem needs Self-esteem, recognition, status

Social needs Sense of belonging, love

Safety needs Security, protection

Physiological needs Hunger, thirst

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Psychological factors

 Perception
P
 The process by which people select, organize,
and interpret information to form a meaningful
picture of the world.

3 PERCEPTUAL PROCESSES

Selective Selective Selective

attention distortion retention
the tendency of people to
STIMULI the tendency for people to the tendency of people to
remember information
screen out most of the interpret information in a
that supports their
information to which they way that will support
interests, values and
are exposed what they already believe
beliefs

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Psychological factors

 Learning
P
 Changes in an individual’s behavior arising from
experience.

Drive

Stimulus Response Reinforcement

Cue

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Psychological factors

 Belief
P
 A descriptive thought that a person holds about
something.
 Based on real knowledge, opinion, or faith and
may or may not carry an emotional charge.

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Psychological factors

 Attitude
P
 A person’s consistently favorable or unfavorable evaluations,
feelings, and tendencies toward an object or idea.
 Difficult to change  A company should usually try to fit its
products into existing attitude patterns rather than attempt to
change attitudes.

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4. BUYING DECISION BEHAVIOR
Products: expensive, risky,
P
Products: low-cost,
purchased infrequently, and frequently purchased.
highly self-expressive.
High involvement Low involvement

Significant differences Complex Variety – seeking

between brands buying behavior buying behavior

Few differences Dissonance – reducing Habitual

between brands buying behavior buying behavior

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BUYING DECISION BEHAVIOR

 Habitual buying behavior

P
 Brand beliefs formed by passive learning
 Buying process:
• Beliefs  Purchase  (Evaluation)
• Buyers are not highly committed to any brands
 Simply select a familiar brand out of habit rather
than strong brand loyalty.
 Marketers need to:
• Use price and sales promotions to promote buying
• Add product features or enhancements to differentiate
their brands from the rest of the pack and raise
involvement

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BUYING DECISION BEHAVIOR

 Variety – seeking buying behavior

P
 Brand switching occurs for the sake of variety (out of boredom
or simply to try something different) rather than because of
dissatisfaction.
 Marketers need to:
• Market leaders: encourage habitual buying behavior by dominating
shelf space, keeping shelves fully stocked, and running frequent
reminder advertising
• Challengers: encourage variety seeking by offering lower prices, special
deals, coupons, free samples, and advertising that presents reasons for
trying something new.

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BUYING DECISION BEHAVIOR

 Dissonance – reducing buying behavior

P
 Shop around to learn what is available but buy relatively quickly.
 Respond primarily to a good price or purchase convenience.
 Consumers might experience post-purchase dissonance (after-
sale discomfort) when:
• Notice certain disadvantages of the purchased brand
• Hear favorable things about brands not purchased
 Marketers need to:
• After-sale communications: provide evidence and support to help
consumers feel good about their brand choices

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BUYING DECISION BEHAVIOR

 Complex buying behavior

P
 The consumer has much to learn about the product category.
 Pass through a learning process:
• Beliefs  Attitudes  Purchase
 Marketers need to:
• Understand the information-gathering and evaluation behavior.
• Help buyers learn about product-class attributes and their relative
importance; differentiate their brand’s features.
• Motivate store salespeople and the buyer’s acquaintances to influence the
final brand choice.

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5. BUYER DECISION PROCESS
P
Need Information Evaluation Purchase Post-purchase
recognition search of alternatives decision behavior

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 BUYER DECISION PROCESS

 Need recognition
P
 The buyer recognizes a problem or need.
 The need can be triggered by: status Desire
• internal stimuli (e.g. drive)
• external stimuli (e.g. advertisements or
recommendations)
+-
 Marketers should research consumers to find out:
• what kinds of needs or problems arise
• what brought them about need No need
• how they led the consumer to this particular
product

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 BUYER DECISION PROCESS

 Information search
P
 The stage in which the consumer is motivated to
search for more information.
 Results:
• Consumer’s awareness and knowledge of the available brands
and features increase.
• Drop certain brands from consideration.
 Marketers need to:
• Design its marketing mix to make prospects aware of and
knowledgeable about its brand.
• Carefully identify consumers’ sources of information and the
importance of each source.

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BUYER DECISION PROCESS

 Information search
P
 Sources of information: Experiential Personal Public Commercial

AVAILABILITY EFFECTIVENESS
• Personal sources (family, friends, neighbors,
acquaintances)
• Commercial sources (advertising, salespeople, dealer and
manufacturer web and mobile sites, packaging,
displays)
• Public sources (mass media, consumer rating
organizations, social media, online searches and peer
reviews)
• Experiential sources (examining and using the product)
 The relative influence of these information
sources varies with the product and the buyer.

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BUYER DECISION PROCESS

 Evaluation of alternatives
P
 The stage in which the consumer uses information to
evaluate alternative brands in the choice set.
 How consumers evaluate purchase alternatives
depends on the individual consumer and the specific
buying situation.
 Results: Rank brands and form purchase intentions
 Marketers need to:
• Study buyers to find out how they actually evaluate brand
alternatives and what evaluative processes go on, hence to
take steps to influence the buyer’s decision.

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 Brand Reliability

The specifications
scooter
design

usefulless
price
 Service Place,

view
Room
Quality

Extra service
price
BUYER DECISION PROCESS

 Purchase decision
P
 The buyer’s decision about which brand to
Hypermarket
purchase.
Supermarket

Discount Store

Chain store

Department Store

Specialty store

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BUYER DECISION PROCESS
P
(e.g: family)

Attitudes of others
Purchase Purchase
intention decision
Unexpected situational factors

(e.g: recession, competition,

recommendations)

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 BUYER DECISION PROCESS

 Post-purchase behavior
P
 The stage in which consumers take further action
after purchase, based on their satisfaction or
dissatisfaction.

 Marketers need to:

• Measure customer satisfaction regularly.
• Set up systems that encourage customers to complain.

44
BUYER DECISION PROCESS

 Post-purchase behavior
P
 Customer satisfaction lies in the relationship between
the consumer’s expectations and the product’s perceived
performance.
• Perceived performance < expectations: disappointed
• Perceived performance > expectations : satisfied;
• Perceived performance ≥ expectations : delighted.
 Why is it so important to satisfy the customer?
• Key to building profitable relationships with consumers
• Keep and grow consumers
• Reap customer lifetime value

45
BUYER DECISION PROCESS

 Post-purchase behavior
P
 Cognitive dissonance, or discomfort caused by post-purchase conflict.

Consumers are satisfied with Consumers feel uneasy about

the benefits of the chosen
brand and are glad to avoid
the drawbacks of the brands
not bought
acquiring the drawbacks of the
chosen brand and about
losing the benefits of the
brands not purchased.

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BUYER DECISION PROCESS

 Post-purchase behavior
P
 Satisfied customers:
• Buy again
• Talk favorably to others about the product
• Pay less attention to competing brands and advertising
• Buy other products from the company.
 Dissatisfied customers:
• Say nothing
• File a complaint
• Bad-mouth the product and the company
• Sue

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6. BUYER DECISION PROCESS FOR NEW
PRODUCTS
 New product
P
 A good, service, or idea that is perceived by some
potential customers as new.
 Adoption
 The decision by an individual to become a regular
user of the product
 Adoption process
 The mental process through which an individual
passes from first hearing about an innovation to final
adoption.

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STAGES IN THE ADOPTION PROCESS
P
Awareness Interest Evaluation Trial Adoption

The consumer The consumer The consumer The consumer The consumer
becomes aware seeks considers tries the new decides to make
of the new information whether trying product on a full and regular
product but lacks about the new the new small scale to use of the new
information product. product makes improve his or product.
about it. sense. her estimate
of its value.

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ADOPTER CATEGORIES
P
A Innovators 100

% share of all adopters

B Early adopters 75

C Early mainstream 50

D Late mainstream
25
2.5% 13.5% 34% 34% 16%
E Lagging adopters
0
A B C D E
Time of adoption of innovation
50
ADOPTER CATEGORIES
P
A Innovators venturesome, curious—they try new ideas at some risk

respected—they are opinion leaders in their communities

B Early adopters and adopt new ideas early but carefully

deliberate—although they rarely are leaders, they adopt new

C Early mainstream
ideas before the average person

skeptical—they adopt an innovation only after a majority

D Late mainstream of people have tried it

tradition bound—they are suspicious of changes and adopt the

E Lagging adopters innovation only when it has become something of a tradition itself

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INFLUENCE OF PRODUCT CHARACTERISTICS
ON RATE OF ADOPTION P
The degree to which the innovation appears
Relative advantage
superior to existing products. (+)
The degree to which the innovation fits the values
Compatibility
and experiences of potential consumers. (+)
The degree to which the innovation is (-) RATE OF
Complexity
difficult to understand or use. ADOPTION

The degree to which the innovation may be (+)

Divisibility
tried on a limited basis.

The degree to which the results of using the (+)

innovation can be observed or described to others.
Communicability

52
INFLUENCE OF PRODUCT CHARACTERISTICS
ON RATE OF ADOPTION
 Other product characteristics
P
 Initial and ongoing costs (-)
 Risk and uncertainty (-)
 Social approval (+)
 …

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