In the Name of Allah, The Most Beneficent, The Most Merciful

Consumer Behavoiur

SESSION 1
BY
Khurram NasarullahKhan
Text Book:
 CHAPTER 1
Revision of few concepts

What is Marketing?
 What is Marketing?
Marketing Definition (AMA)
Marketing is the activity, set of institutions, and
processes for creating, communicating, delivering, and
exchanging offerings that have value for customers,
clients, partners, and society at large. (Approved 2017).

Mkt is [ASIP] for [CCDXV] for [CCPS]

Reference: Consumer Behavior 13th Edition Michael R. Solomon

 What is Marketing?
Marketing Definition
It is … C. C. D. V. T. P *

Creating , Target Market for

Communicating ,
Profit/Value

Delivering

Value to
Reference: Principles of Marketing 18th Edition Kotler and Armstrong * Ref: Philip Kotler’s Simplified definition.
 What is Marketing?
Marketing Definition

“meeting Needs/Wants profitably”

 What is Demand?
Customer Demand

Demand: Human wants that are backed by buying power.

i.e. if a Customer has
Needs/Wants + is Willing + has buying power,
Need/ Buying
then we called it a DEMAND. Willing = DEMAND
Want power

Reference: Consumer Behavior 13th Edition Michael R. Solomon

 What is Value?
Customer Value
Value:
Sum of perceived tangible and intangible benefits
received from the offering against the cost or
hassle.

Combination of Quality, Service and Price. It is

“Customer Value Triad”.

Value = benefits received – [price + hassle]

“Value lies in the mind of the consumers”

Reference: Consumer Behavior 13th Edition Michael R. Solomon

 People in the marketplace

• Consumption Communities
(Who are the people that Consume?)

• Market Segmentation Strategies

(Why do we need to classify and
categorize them?)

1-10 Copyright © 2017 Pearson Education, Inc.

Reference: Consumer Behavior 13th Edition Michael R. Solomon
 Consumer Behavior
Definition
It is the study of the processes involved when
individuals or groups select, purchase, use, or dispose
of products, services, ideas, or experiences to satisfy
needs and desires.

We consume Products and services to satisfy our needs

and wants.
Reference: Consumer Behavior 13th Edition Michael R. Solomon
 Few Terms
Definition
Exchange:
It is a transaction in which two or more organizations or
people give and receive something of value.

Consumer:
Consumer is a person who identifies a need or desire, makes
a purchase, and then disposes of the product during the three
stages of the consumption process.
Reference: Consumer Behavior 13th Edition Michael R. Solomon
 Few Terms
Definition
Influencer:
He/she is a person recommends certain products or services
without actually buying or using them.

Reference: Consumer Behavior 13th Edition Michael R. Solomon

 Importance of Consumer behavior

Why should managers, advertisers, and other marketing

professionals bother to learn about consumer behavior?

Simply, because it’s a good business.

Reference: Consumer Behavior 13th Edition Michael R. Solomon

 Figure 1.1
Stages in the Consumption Process

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Reference: Consumer Behavior 13th Edition Michael R. Solomon
 For Reflection

• How do you decide that you need

a product?
• What purchase that makes it
pleasant or stressful for you?
• When using the product, what
determines if the experience is
pleasant?

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Reference: Consumer Behavior 13th Edition Michael R. Solomon
 Learning Objective 2

Marketers have to understand

the wants and needs of
different consumer segments.

Copyright © 2017 Pearson Education, Inc. 1-17

Reference: Consumer Behavior 13th Edition Michael R. Solomon
 Consumers Are Different

Classifications of consumers: (Why to Classify?)

→ to help built Loyalty.

• Heavy Users vs Light Users

• 80/20 Rule (Pareto Rule)

Copyright © 2013 Pearson Education, Inc. publishing as
1-18
Reference: Consumer Behavior 13th Edition Michael R. Solomon Prentice Hall
 Segmenting Consumers: Demographics
Marketers use many dimensions to divide up a larger market.

Demographics:
• Age (different age groups have different Needs and prefer different products)
• Gender (understanding gender help to know what will appeal to them)
• Family structure (products are design for different Family Size and Structure)
• Social class/income (Similar income people may have similar needs/wants)
• Race/ethnicity (Focusing specific products for certain Race/ethnicity )
• Geography (Marketer focus on certain areas for certain products)
• Lifestyles (people with Different lifestyle → prefer different products)
1-19 Copyright © 2017 Pearson Education, Inc.
Reference: Consumer Behavior 13th Edition Michael R. Solomon
 Big Data

• Database Marketing (Getting Customers’ Information)

• Relationship Marketing (Regular interaction with Consumers)
• Big Data (Analyzing all customer data for patterns)

More customer’s data we have, easier it would be to understand

their wants and needs to satisfy them.

1-20 Copyright © 2017 Pearson Education, Inc.

Reference: Consumer Behavior 13th Edition Michael R. Solomon
 Popular Culture
Marketing stimuli surround us as advertisements, stores, and products
compete for our attention and our dollars.
• Music User Generated Contents (UGC) can boost Sales.
• Movies e.g. Coke + Mentos videos on YouTube
• Sports
• Books Cultural impact is hard to overlook.
• Celebrities
• Entertainment Marketers influence people through movies and music
heroes, fashions, food, and decorating choices.

1-21 Copyright © 2017 Pearson Education, Inc.

Reference: Consumer Behavior 13th Edition Michael R. Solomon
 Consumer-Brand Relationships

• Role Theory- much of consumer behavior resembles actions in a play.

(Act as multiple roles→ use different things. Is this product matches my role?)

• Self-concept attachment—The product helps to establish the user’s identity.

• Nostalgic attachment—The product serves as a link with a past self.

• Interdependence—The product is a part of the user’s daily routine.

• Love—The product elicits emotional bonds of warmth, passion, or other strong

emotion
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Reference: Consumer Behavior 13th Edition Michael R. Solomon
 Learning Objective 4

Our motivations to consume are complex and varied.

People often buy products not for what they do, but for what they
mean.

Consumers usually go for the what product mean in their lives.

Copyright © 2017 Pearson Education, Inc. 1-23

 Motivation
Customer Need
What you want.
Need
• Recognition of Gap between consumer’s actual
state and the Ideal state.
GAP

• States of being felt-deprivation

(feel of something is missing) What you have.

• A need is something a person must have to live or

achieve a goal.
• e.g. food, clothing, warmth, and safety; social
needs for belonging and affection; and individual
needsBehavior
Reference: Consumer for knowledge
th and
13 Edition Michael self-expression
R. Solomon
 Motivation
Customer Want
Want
• The form human needs take as they are
shaped by culture and individual
personality.
• A want is a specific manifestation of a
need that personal and cultural factors WANT

determine.

Reference: Consumer Behavior 13th Edition Michael R. Solomon

 Satisfaction
Customer Satisfaction
Customer Satisfaction:
Feeling of pleasure by fulfillment of expectations from the offer.
The extent to which a product’s perceived performance
matches a buyer’s expectations.

Satisfaction= Perceived Value – [Expected Value]

P > E => Delighted Customer → Loyal

P = E => Satisfied Customer → Vulnerable
P < E = >Dissatisfied Customer → Destructive
Satisfied customers buy again and tell others about their good experiences.
Dissatisfied customers often switch to competitors and criticize the product to others.
Reference: Consumer Behavior 13th Edition Michael R. Solomon
 The Digital Native: Living a Social [Media] Life

• B2C e-commerce
• C2C e-commerce
• Digital Native (Tech. savvy)
• Synchronous interactions
• Asynchronous interactions

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Reference: Consumer Behavior 13th Edition Michael R. Solomon
 Consumer Trends
• It’s crucial for marketers of all stripes
to stay on top of consumer trends.

• Trends are underlying values that

drive consumers toward or away
from certain products and services.

1-28 Copyright © 2017 Pearson Education, Inc.

Reference: Consumer Behavior 13th Edition Michael R. Solomon
THANK YOU