Chapter 5: Consumer Markets and Consumer Buyer Behavior

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Consumer buying behavior: refers to the buying behavior of final consumers – individuals and households who buy goods and services for personal consumption All of these final consumers combine to make up the consumer market

Stimulus-Response Model of Consumer Behavior Stimuli 4P’s Other characteristics • Economic • Technological • political • cultural Buyer’s Black Box Buyer characteristics Buyer decision process Buyer Response Product choice Brand choice Dealer choice Purchase timing Purchase amount

• The stimulus-response model of buyer behavior shows that marketing (made up of the four P’s —product, price, place, and promotion) and other stimuli (such as the economic, technological, political, and cultural environments) center on the consumer’s “black box” and produce certain responses. • Marketers must figure out what is “in” the consumer’s “black box.” • The “black box” has two parts. • 1) The buyer’s characteristics influence how he or she perceive and react to stimuli. • 2) The buyer’s decision process itself affects the buyer’s behavior. Characteristics Affecting Consumer Behavior

A CULTURAL FACTORS: A-1 Culture: It is the set of basic values, perceptions, wants, and behaviors learned by member of society from family and other important institutions • It Forms a person’s wants and behavior • Marketers are always trying to spot cultural shifts in order to imagine new products that might be wanted (the fitness and health craze of the late 80s and 90s for example). A-2 Subculture: It is a group of people with shared value systems based on common life experiences and situations • Each culture contains smaller subcultures. • Subcultures might be nationality groups, religious groups, racial groups, or geographic area groups. Many of these subcultures make up important market segments and many times products are designed for them. A-3 Social Class: It is the relatively permanent and ordered divisions in a society whose members share similar values, interests, and behaviors. • Social class is not determined by a single factor such as income but is measured as a combination of occupation, income, education, wealth, and other variables. • Social scientists have identified seven social classes: a). Upper Uppers (less than 1 percent). b). Lower Uppers (about 2 percent). c). Upper Middles (about 12 percent). d). Middle Class (about 32 percent). e). Working Class (about 38 percent). f). Upper Lowers (about 9 percent). g). Lower Lowers (about 7 percent). • Marketers are interested in social class because people within a given social class tend to exhibit similar behavior, including buying behavior. This is most evident in the selection of clothing, home furnishings, leisure activity, and automobiles.

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2]. B-3 Roles and Status: • A person belongs to many groups and the person’s position within each group can be defined in terms of both role and status. knowledge. lawyers. It is felt that a person’s lifestyle does affect their purchase behavior. Marketers try to identify opinion leaders and direct products and communications toward them. • Examples of AIOs include: a). because of special skills. and doctors). Aspirational: An aspirational group is a group to which an individual wishes to belong. etc. or other characteristics. recreation. Buying roles change with evolving lifestyles (such as more females working outside the home). etc.). Marketers identify them to use as brand ambassadors. • A person could change positions over time. fashion. • Self-orientation groups include: 1]. b). c). • A role is the activities a person is expected to perform according to the people around him or her. 3]. etc. and risk taking. social issues. Status-oriented consumers who base their purchases on the actions and opinions of others. • Online Social Networks are online communities where people socialize or exchange information and opinions • Include blogs. they are groups to which a person belongs b. It includes trends in 1) Personal Income. Interests (food. • If the person perceives that their economic situation is going to improve. • Groups are further subdivided based on self-orientation and resources.B SOCIAL FACTORS: B-1 Reference Groups: • These include small groups. exert influence on others. • Status is the general esteem given to a role by society. Opinions (about themselves. c. Part of these changes are shaped by the family life cycle (stages throughout which families might pass as they mature over time).  Marketers are interested in the roles and influence of the husband. variety. interests.). personality. hobbies. 2) Savings. People are often influenced by reference groups to which they do not belong. Membership groups are groups that have a direct influence on a person’s behavior. Lifestyle profiles a person’s whole pattern of acting and interacting in the world. virtual worlds (second life)  B-2 Family:  The influence can be very strong because the family is the most important consumer-buying organization in society. The traditional life cycle stages are being modified as people form new lifestyles (such as single parenting) C-2 Occupation: A person’s occupation affects the goods and services bought (software bought by accountants. family. and social roles and status. and opinions). Opinion leaders are best for Word-of-mouth influence and buzz marketing. C SOCIAL FACTORS: C-1 Age and life cycle: People change the goods and services that they buy over their lifetimes. wife. 2 . they might consider making a major purchase C-4 Lifestyle: A lifestyle is a person’s pattern of living as expressed in his or her psychographics (such as activities. • The most widely used lifestyle classification is the SRI Values and Lifestyles (VALS) typology. • VALS classifies people according to their consumption tendencies by how they spend their time and money. and children in the purchase of different products and services. It is more than the person’s social class or personality. shopping.). social networking sites (facebook). business. An opinion leader is a person within a reference group who. C-3 Economic situation: The economic situation of the buyer is very important in purchase consideration. People often choose products that show their status in society. a. Marketers try to identify the influencer role in a family unit (such as children). Action-oriented buyers who are driven by their desire for activity. • There are several specialized group formations within the larger configuration • Reference groups are groups that that have a direct (face-to-face) or indirect influence on the person’s attitudes or behavior. Activities (work. their purchasing habits generally change. Principle-oriented consumers who buy based on their views of the world. 3) Interest Rates • If a person fears losing their job.

prestige products and services that demonstrate success to their peers. and self-discovery. and socializing. health. • Image is important to Innovators. and social activities. • As consumers. (3) Believers are motivated by ideals. • They value consensus. and value in the products they buy. (5) Strivers are trendy and fun loving. • Many Believers express moral codes that are deeply rooted and literally interpreted. entertainment. satisfied. • Innovators are very active consumers. • Innovators are among the established and emerging leaders in business and government. and impulsive consumers. (4) Achievers: Motivated by the desire for achievement. independence. • As young. • They favor stylish products that emulate the purchases of people with greater material wealth. (6) Experiencers are motivated by self-expression. • Achievers live conventional lives. functionality. practical consumers. education. • They look for durability. established codes: family. Thinkers are conservative. community. • Although their incomes allow them many choices. • Strivers are active consumers because shopping is both a social activity and an opportunity to demonstrate to peers their ability to buy. enthusiastic. comfortable. religion. • they favor established. and reflective people who value order. Achievers have goal-oriented lifestyles and a deep commitment to career and family. sports. they are as impulsive as their financial circumstance will allow. and a lack of skills and focus often prevents them from moving ahead. • Image is important to Achievers. and social or religious organizations to which they belong. niche products and services. • Because of their busy lives. and personality. Experiencers quickly become enthusiastic about new possibilities but are equally quick to cool. • Experiencers are avid consumers and spend a comparatively high proportion of their income on fashion. organized in large part around home. • They tend to be well educated and actively seek out information in the decision-making process. the offbeat. (2) Thinkers are motivated by ideals. sophisticated. • They seek variety and excitement. knowledge. predictability. • Thinkers have a moderate respect for the status quo institutions of authority and social decorum. they choose familiar products and established brands. they are often interested in a variety of time-saving devices. • Their social lives reflect this focus and are structured around family. • Their lives are characterized by variety. and work. and their purchases reflect cultivated tastes for upscale. energy. • Their energy finds an outlet in exercise. • They are change leaders and are the most receptive to new ideas and technologies. • Because they are motivated by achievement. yet they continue to seek challenges. • They are generally loyal customers. and other factors Lifestyle segmentation (1) Innovators are successful. and the risky. • They follow established routines.• Resources can be either abundant or minimal depending on whether the the buyer has high or low levels of income. and responsibility. Strivers are concerned about the opinions and approval of others. community. • Their possessions and recreation reflect a cultivated taste for the finer things in life. and the nation. Believers are predictable. Highly motivated people with high selfesteem. • They are conservative. are politically conservative. intimacy. family. self.confidence. as an expression of their taste. conventional people with concrete beliefs based on traditional. and stability over risk. • As consumers. • They are well-informed about world and national events and are alert to opportunities to broaden their knowledge. and respect authority and the status quo. • Money defines success for Strivers. savoring the new. their place of worship. take-charge. who don't have enough of it to meet their desires. • They are mature. 3 . but are open to consider new ideas. • Many see themselves as having a job rather than a career. outdoor recreation.

• The self-concept describes the self-image. person has many needs at any given time and they can be biological or psychological. and interpret information to form a meaningful picture of the world. • Personality is a person’s unique psychological characteristics that lead to relatively consistent and lasting responses to his or her own environment. wholesome and cheerful) 2) Excitement (Daring. they buy basic products. (8) Survivors live narrowly focused lives. honest. • They express themselves and experience the world by working on it-building a house.). A brand personality is the specific mix of human traits that may be attributed to a particular brand. and beliefs and attitudes): D-1 Motivation  A motive is a need that is sufficiently pressing to direct the person to seek satisfaction. Survivors do not show a strong primary motivation. (7) Makers are motivated by self-expression Like Experiencers. social. practical work. • With few resources with which to cope. These differences in perception can be accounted for by three perceptual processes: 1. sociability. • They are comfortable with the familiar and are primarily concerned with safety and security. A person does not fully understand his or her motivation according to Freud. but resentful of government intrusion on individual rights. • Makers are practical people who have constructive skills and value self-sufficiency. The needs include: D-2 Perception • • • Perception is the process by which people select. and physical recreation and have little interest in what lies outside that context. they often believe that the world is changing too quickly. • They live within a traditional context of family. etc. Several theories of motivation include: 1. • They represent a very modest market for most products and services. a person would try to satisfy the most important needs first. Under this idea. esteem.• Their purchases reflect the emphasis they place on looking good and having "cool" stuff. • They are respectful of government authority. C-5 Personality and self-concept: • Each person’s personality and self-concept will influence their buying behavior. raising children. spiritual. • Survivors are cautious consumers. organize. These ideas spawned the field of motivation research 2. intelligent and successful) 4) Sophistication (Upper Class & Charming) 5) Ruggedness (Outdoorsy and tough) D PSYCHOLOGICAL FACTORS: A buyer’s choices are influenced by four major psychological factors (motivation. perception. fixing a car. • They are unimpressed by material possessions other than those with a practical or functional purpose. learning. • They are loyal to favorite brands. dominance. The basic idea is that people’s possessions contribute to and reflect their identities. The marketer must remember that two people with the same motivation and in the same situation may act differently because they perceive the situation differently. Selective attention is the tendency of people to screen out most of the information to which they are exposed 4 . Maslow believed that needs were arranged in a hierarchy (beginning with physiological needs and then continuing with safety. especially if they can purchase them at a discount. Makers are suspicious of new ideas and large institutions such as big business. and self-actualization needs). • Because they must focus on meeting needs rather than fulfilling desires. • Personality is usually described in terms of traits (such as self-confidence. Freud’s theory of motivation assumed that people are largely unconscious about the real psychological forces shaping their behavior. imaginative and up-to-date) 3) Competence (Reliable. Personality can be useful for analyzing consumer behavior for certain brand or product choices. Five brand personalities might be: 1) Sincerity (Down to earth. • Because they prefer value to luxury.

Selective distortion is the tendency of people to interpret information in a way that will support what they already believe. 3. information search. b). c). b). and post purchase behavior. Complex Buying Behavior: Highly involved. where. or faith. • Marketers need to focus on the entire buying process rather than on just the purchase decision a. Attitudes put people into a frame of mind of liking or disliking things. c) Cues are minor stimuli that determine when. Habitual: Low involvement. Because beliefs make up product and brand images. then the response is reinforced D-4 Beliefs and Attitudes A person’s beliefs and attitudes are acquired through acting and learning. purchase decision. • The model seems to imply that consumers pass through all five stages with every purchase. significant brand differences Example – computer • It occurs when consumers are highly involved in a purchase and perceive significant differences among brands. 2. • Ad repetition creates brand familiarity rather than brand conviction. Cues can influence a buyer’s response to an impulse d) Reinforcement (Feedback on action) If the experience is rewarding. Beliefs may or may not carry an emotional charge. opinion. usually information that supports their attitudes and beliefs D-3 Learning Learning describes changes in an individual’s behavior arising from experience Learning occurs through the interplay of: a) A drive (a strong internal stimulus that calls for action). 4. • Counter dissonance occurs with after-sale communications to support claims and make consumers feel better about purchases 3. More complex decisions usually involve more buying participants and more buyer deliberation 1. and how the person responds. Belief : a descriptive thought that a person holds about something (a brand or service) a). little brand differences Example – carpeting • After these purchases. a person might skip or reverse some of the stages.behavior sequence. The need can be triggered by internal stimuli when one of the person’s normal needs rises to a level high enough to become a drive. consumer behavior does not pass through the usual belief-attitude. Need recognition is the first stage of the buyer decision process in which the consumer recognizes a problem or need. People tend to act on their beliefs. A person’s attitudes fit into a pattern and changing one attitude may require changing others Types of Buying Decision Behavior a. they are important to marketers. b) Stimuli (Objects that move drive to motive) A drive becoming a motive when it is directed toward a particular stimulus object. • In more routine purchases.2. A belief may be based on real knowledge. c). 5 . A belief is a descriptive thought that a person holds about something. 1). it is common to experience post purchase dissonance (after-sale discomfort) when they notice certain disadvantages of the purchase or hear favorable things about brands not purchased. evaluation of alternatives. Attitudes are difficult to change. significant perceived brand differences Example – cookies The Buyer Decision Process • There are five stages within the process: need recognition. • Consumers may be highly involved when the product is expensive. however. Selective retention is the tendency of people to retain only part of the information to which they are exposed. and highly self-expressive. purchased infrequently. Dissonance-reducing: Highly involved. risky. moving toward or away from them. feelings and tendencies toward an object or idea a). Buying behavior differs greatly depending on what is being bought. b. little brand differences Example – salt • In these cases. Variety-seeking: Low involvement. Attitude describes a person’s consistently favorable or unfavorable evaluations.

Evaluation of alternatives is the stage of the buyer decision process in which the consumer uses information to evaluate alternative brands choices. c. It is very important to satisfy customers because a company’s sales come from two basic groups: new customers and retained customers. Determinates are: 1. 2) A satisfied customer also tells others about their experience Buyer Decision Process for New Products New Products: Good. the greater the consumer’s dissatisfaction. In other instances. Stages in the Adoption Process: Marketers should help consumers move through these stages. The consumer arrives at attitudes toward different brands through some evaluation procedure. each of which behaves differently toward new products. The larger the gap between expectations and performance. or salespeople for advice. A need can also be triggered by external stimuli (such as an advertisement). 2) Some sellers might even understate performance levels to boost consumer satisfaction with the product • • Cognitive dissonance is buyer discomfort caused by post purchase conflict and it is very common. the consumer may simply have heightened attention or may go into active information search. the marketer needs to determine the factors and situations that usually trigger consumer need recognition. Innovators Early Adopters Early Majority Late Majority Laggards Product Characeristics & Adoption Five product characteristics influence the adoption rate. service or idea that is perceived by customers as new. 4). They are: 1) The attitude of others. 5). Commercial sources such as advertising and salespeople. it is important to keep current customers happy. How much another person’s attitudes will affect individual choices depends both on the strength of the other person’s attitudes toward the buying decision and on an individual’s motivation to comply with that person’s wishes.2). Sometimes. two factor’s can come between purchase intention and the purchase decision. the purchase intention may be affected e. Five product characteristics influence the adoption rate. Marketers should study buyers to find out how they actually evaluate brand alternatives. however. At other times. 2). Personal sources such as family and friends. Public sources such as the mass media and consumer-rating organizations. d. 4). Purchase decision is the stage of the buyer decision process in which the consumer actually buys the product. In some cases consumers use careful calculations and logical thinking. examining. 3). consumers buy on impulse and rely on intuition. the consumer’s purchase decision will be to buy the most preferred brand. Information search is the stage of the buyer decision process in which the consumer is aroused to search for more information. At this stage. Generally. 3). 3). b. 2). Awareness Evaluation Interest Trial Individual Differences in Innovativeness Consumers can be classified into five adopter categories. Experiential sources such as handling. 2) Purchase intention is also influenced by unexpected situational factors. attitudes and behaviors differ greatly in other countries. Several basic concepts help to explain the consumer-evaluation process: 1). Information can be obtained from several sources: 1). buying or consumer guides. If unexpected situational factors arise as the consumer is about to act. Postpurchase behavior is the stage of the buyer decision process in which consumers take further action after purchase based on their satisfaction or dissatisfaction. consumers make buying decisions by themselves. 1) Because it is more expensive to attract new customers than to retain current ones. or using the product. Relative Advantage Compatibility Divisibility Communicability International Consumer Behavior – Values. The relationship between the consumer’s expectations and the product’s perceived performance. Complexity 6 . the consumer uses friends.

– – – Physical differences exist which require changes in the marketing mix. Marketers must decide the degree to which they will adapt their marketing efforts. Customs vary from country to country. 7 .

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