Name: Argie G.

Catambacan Class Code: MKTG 2265 (3-164)

Summary of Chapter 5: Consumer Markets and Consumer Buyer Behaviour

The consumer market consists of individuals and households that purchase or obtain goods and
services for personal use. The simplest model that they used is the stimulus-response model of buyer
behavior. According to this model, marketing stimuli: the (4 P's) product, price, place, and promotion, and
other significant forces (economic, technological, political, cultural) enter the consumer "black box" and
produce specific responses. Once in the black box, these inputs make observable buyer responses, such as
product choice, brand choice, purchase timing, and purchase amount.

CHARACTERISTICS AFFECTING CONSUMER BEHAVIOR

There are various factors that influence consumers' purchases: social, cultural, personal, and
psychological. First, "cultural factors" exert a broad and profound influence on consumer behavior.
Marketers need to understand the role played by the buyer's culture, subculture, and social class. Culture
has a strong impact on consumer buying behavior, for it is the most basic cause of a person's wants and
needs. It includes the fundamental values, needs, wants, preferences, perceptions, and behaviors observed
and learned by consumers from their nearby family members and other important people around them.
Within a cultural group, there also exist many subcultures. Each subculture provides a more specific
identification of members belonging to it. Hence, marketing programs should be prepared considering
subcultures to tailor their needs. Moreover, every society also possesses some form of social class. And
income does not just determine the social class, but numerous other factors such as occupation, education,
wealth, etc.,
A consumer’s behavior also influenced by “social factors”, such as the buyer’s small groups, family,
and social roles and status. In small groups, there composed of two groups: membership and the
reference groups. A membership group is a group that has a direct influence and to which a person
belongs. It is a social body or organization to which people belong as members, especially when they feel
that the group has formally or informally accepted them into its ranks. In contrast, the reference groups
include individuals or groups that influence our opinions, beliefs, attitudes, and behaviors. They often serve
as our role models and inspiration. Marketers view reference groups as vital because they influence how
consumers interpret information and make purchasing decisions. Reference groups influence what types of
products you will purchase and which brand of product you choose.
Apart from that, word-of-mouth influence can have a powerful impact on consumer buying behavior.
Here, the personal words and recommendations of trusted friends, colleagues, and other consumers tend to
be more trustworthy than those from commercial sources, such as advertisements. And most word-of-mouth
influence occurs when consumers start chatting about a brand thing or feel strongly about one way or
another. Marketers of brands must also figure out how to reach opinion leaders. Opinion leaders are
people within a reference group who exert social influence on others because of skills, knowledge,
personality, or other characteristics. Some experts call this group "the influential or leading adoptersFor,
when this influential talk, the consumers listen. Besides that, there is also what we call "online social
networks," wherein it is an online community such as blogs and social media where people socialize or
exchange information and opinions. This new form of consumer-to-consumer and business-to-consumer
dialog has significant implications for marketers.
Furthermore, family can also have a strong influence on consumer’s behavior. For they are the most
crucial consumer buying organization in society as they tend to purchase many goods and services for their
family needs. Finally, each person holds different roles and status in society depending upon the groups,
clubs, family, organization, etc., to which he belongs. For instance, a woman is working in an organization
as a manager. Now she is playing two roles, one is in the company as a manager, and the other is a mother
of her children. Another example is that if a person is in a high position, his buying behavior will largely be
dominated by his status.
Aside from cultural and social factors, “personal factors” also affect one's buying decision. These
factors are related to the buyer himself. It includes age, occupation, economic circumstances, lifestyle,
personality, and self-concept. First is the person’s age and life cycle stage. People's needs and desires
change over time as they get older; thus, consumer buying behavior is greatly influenced by his age and the
life cycle stage he falls. The life cycle is an orderly series of stages in which consumer attitude and
behavioral tendencies evolve and occur because of developing maturity, experience, income, and status.
For instance, there is more purchase of chocolates when an individual is a child, but as he grows, his
preference for the products also changes. The second is the person's occupation. An individual's nature of
the job also directly influences the products and brands he picks for himself/herself. For example, blue-collar
workers tend to buy more ragged work clothes, whereas executives buy more business suits. The third one
is the economic situation. Here, the buying tendency of an individual is directly proportional to their income
or earnings. Individuals with high income would buy expensive products compared to individuals from
middle- and lower-income groups who would spend mostly on necessary items. The last one is the
lifestyle. An individual's lifestyle has something to do with his style, attitude, perception, social relations,
and immediate surroundings. And many people coming from the same subculture, social class, and
occupation may have quite different lifestyles. For instance, it is important for some people to wear branded
clothes, whereas some individuals are not that brand conscious.
Finally, the “psychological factors”. When we talk about psychological factors that influence consumer
decisions, we refer to the workings of the mind or psyche: motivation, perception, learning, beliefs, and
attitudes. It isn't easy to measure the impact of psychological factors as they are internal, but they are
powerful to control people's buying choices. A manager must try to understand the potential role the
elements play in making buying decisions.
TYPES OF BUYING DECISION BEHAVIOR
Buying behavior may vary significantly across different types of products and buying decisions. When
highly involved in a purchase, consumers undertake complex buying behavior and perceive significant
differences among brands. In contrast, dissonance-reducing behavior occurs when consumers are highly
involved but see little difference among brands. On the other hand, habitual buying behavior happens
under low involvement conditions and has little significant brand difference. When buyers purchase products
that they use for their daily routine, they do not put a lot of thought. Meanwhile, consumers engage in
variety-seeking buying behavior when there is a low involvement but significant perceived brand
differences. In these cases, consumers often do a lot of brand switching because they might want to try out
new products just out of curiosity or boredom.

THE BUYER DECISION PROCESS

When making a purchase, the consumer goes through a decision process that consists of (5) stages:
need recognition, information search, evaluation of alternatives, purchase decision, and postpurchase
behavior. Here, the job of the marketer is to grasp the buyer's behavior at each stage and the influences
that are operating. During need recognition, the buyer recognizes a problem or need. The need can be
triggered by internal and external stimuli. And at this stage, the marketer should research consumers to
determine what kinds of needs or problems arise. Further, once the need is recognized, the consumer is
awakened to seek and gather more information and moves into the information search stage. After that,
the buyer proceeds to alternative evaluation, during which the information is used to evaluate brands in
the choice set. That's why marketers should study buyers to determine how they assess brand alternatives.
From there, the consumer makes a purchase decision and buys the product. In the last stage, which is
the postpurchase behavior, the consumer acts whether they are satisfied or dissatisfied.

THE BUYER DECISION PROCESS FOR NEW PRODUCTS

The product adoption process consists of 5 stages: Awareness, interest, evaluation, trial, and
adoption. In the awareness stage, the consumer becomes aware of the new product. While in the interest
stage, the consumer seeks information about the new product. Then, next is the evaluation stage, wherein
the consumers consider whether trying the new product makes sense or not. Afterward is the trial stage,
where the consumer may try the new product, followed by the adoption process, where the consumer can
decide to make full and regular use of the new product. Lastly, several characteristics influence the rate of
adoption: relative advantage, compatibility, complexity, divisibility, and communicability.