Topic 1

Introduction to Consumer
Behavior

CONSUMER
BEHAVIOR, 11e
Michael R. Solomon

1-1
Copyright © 2015 Pearson Education
 Chapter Objectives
When you finish this chapter, you should understand why:
1. Consumers use products to help them define their identities
in different settings.
2. Consumer behavior is a process.
3. Marketers need to understand the wants and needs of
different consumer segments.
4. The Web is changing consumer behavior.
5. Consumer behavior relates to other issues in our lives.
6. Many different types of specialists study consumer behavior.
7. There are two major perspectives that seek to understand
and study consumer behavior.

Copyright © 2013 Pearson Education 1-2

 A Consumer Is…
• A person who identifies a need or desire,
makes a purchase, and then disposes of
the product.
• Consumers are categorized as
organizations or groups; One or several
persons may make the purchase decision
for the group.

Copyright © 2013 Pearson Education 1-3

 Learning Objective 1

• Consumers use products

to help them define their
identities

• Such as? Discuss.

Copyright © 2013 Pearson Education 1-4

 Consumer Identity as an Aid to Marketers
• Consumers segmented by demographics
and psychographics
• Consumers understood in part based on
their consumption communities and
reference groups
• Brands target consumers using market
segmentation strategies
• Consumers may choose brands that
match with their own identities
Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall 1-5
 Learning Objective 2
• Consumer behavior is a process.

Copyright © 2013 Pearson Education 1-6

 Consumer Behavior is

Consumer behavior: 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.

Copyright © 2013 Pearson Education 1-7

 Consumer Behavior Is a Process
• Consumer behavior is an ongoing process
that covers the entire consumption process
(before, during and after a purchase, not just
when payment is made).
• Different people play a role in the process:
- Purchaser (buys)
- User (uses)
- Influencer (recommends for or against)
Copyright © 2013 Pearson Education 1-8
 Figure 1.1
Stages in the Consumption Process

Copyright © 2013 Pearson Education 1-9

Understanding Consumer Behaviour Is
Good Business
• Marketers can only satisfy consumer
needs if they understand the
people/organizations who will use the
products/services they sell.
• Data about consumers help to define the
market and identify threats &
opportunities for a brand.
• This ensures that product continues to
appeal to its core market.
Copyright © 2013 Pearson Education 1-10
 Sony Walkman

Then Now
Copyright © 2013 Pearson Education
 Learning Objective 3
• Marketers need to
understand the
needs and wants of
different consumer
segments.

Copyright © 2013 Pearson Education 1-12

 How to segment Consumers:
Demographics
Demographics:
• Age
• Gender
• Family structure
• Social class/income
• Race/ethnicity
• Geography

Copyright © 2013 Pearson Education 1-13

How to segment Consumers:
Psychographics **Added New Slide
• Psychographics – Lifestyles, values,
activities, interests, opinions
• Consumers have different lifestyles even if
they share the same demographics
• Relationship marketing – interact with
customers to build relationships
• Database marketing – tracking consumers’
buying habits and tailoring messages to their
specific needs & wants

Copyright © 2013 Pearson Education 1-14

 Popular Culture
• Music Marketers influence:
• Movies - preferences for movie and
music heroes, fashions,
• Sports food, and decorating
• Books choices.
• Celebrities - The way we acknowledge
• Entertainment cultural events and social
issues (e.g. marriage,
death; global warming,
gambling)

Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall 1-15

 Consumer-Brand Relationships
• Self-concept attachment – means the
product helps to establish the user’s identity
• Nostalgic attachment – means the product
serves as a link to the consumer’s past
• Interdependence – means the product is a
part of the user’s daily routine
• Love – it elicits emotional bonds of warmth,
passion, or other strong emotion

Copyright © 2013 Pearson Education 1-16

 Product Relationships

Self-Concept Nostalgic
attachment attachment
Copyright © 2013 Pearson Education
 Love

Interdependence
Copyright © 2013 Pearson Education
 For Reflection
• What kind of relationship do you have with
your car or hand phone?
• Identify the type of relationship you have
with your car or hand phone? Is it…
- Self- concept attachment?
- Nostalgic attachment?
- Interdependence?
- Love?

Copyright © 2013 Pearson Education 1-19

 Learning Objective 4

• The Web is changing

consumer behavior.
• It has created a global
consumer culture.
• It’s also made
possible a whole new
form of media known
as social media.

Copyright © 2013 Pearson Education 1-20

 Social Media

• Social media are the online means of

communication, conveyance (deliver),
collaboration, and cultivation among
interconnected and interdependent
networks of people, communities, and
organizations enhanced by technological
capabilities and mobility.

Copyright © 2013 Pearson Education 1-21

 Social Media
• Electronic marketing has increased
convenience by breaking down barriers of
time and location.
• There is now B2C e-commerce
(businesses selling to consumers) and
C2C e-commerce (consumers selling to
consumers).

Copyright © 2013 Pearson Education 1-22

 Social Media
• Virtual brand communities are groups of
people often brought together by their
shared interests, who actively share their
opinions on online platforms.
• They expand consumption communities
beyond those available in local
communities.
• E.g: Harley-Davidson, Starbucks, Sephora

Copyright © 2013 Pearson Education 1-23

 Learning Objective 5
• Our beliefs and actions as consumers
strongly connect to other issues in our
lives such as “marketing ethics”.
• Marketing ethics means considering how
businesses may manipulate consumers
as well as how consumers may
manipulate businesses.

Copyright © 2013 Pearson Education 1-24

Wendy’s “Chili Finger Lady”

Copyright © 2013 Pearson Education 1-25

 Marketing Ethics and Public Policy

• Business ethics are rules of conduct

that guide actions in the marketplace –
the standards against which most people
in a culture judge what is right, wrong,
good or bad.
• There are cultural differences in what
is considered ethical.

Copyright © 2013 Pearson Education 1-26

 Marketing Ethics and Public Policy

• Is bribery acceptable? Bribing foreigners

to gain business has been against the law
in the United States since 1977, under the
Foreign Corrupt Practices Act. It may be
acceptable in many countries!
• Other illegal actions may include a
manufacturer deliberately mislabeling the
contents of a package.

Copyright © 2013 Pearson Education 1-27

 Do Marketers Create Artificial Needs?

Objective of marketing: create awareness that

needs exist, not to create needs

• Need: a basic • Want: one way

versus that society has
biological motive
taught us that
(e.g: thirst – the need can be
biologically based) satisfied
(e.g: Coca-Cola,
instead of milk)
Copyright © 2013 Pearson Education 1-28
 Are Advertising & Marketing Necessary?

YES
because consumers may not know that
solutions to problems exist without the
information provided by advertising and
marketing. This is the view of the
economics of information perspective.
YES because it helps consumers by
reducing search time (there is an economic
costs to searching for information)

Copyright © 2013 Pearson Education 1-29

 Are Advertising & Marketing Necessary?

Does advertising foster materialism?

• Products are designed to meet existing
needs;
• Advertising only helps to communicate
their availability

Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall 1-30

 Do Marketers Promise Miracles?

• Advertisers simply
do not know
enough about
people to
manipulate them.
• The failure rate for
new products
ranges from 40 to
80%.
Copyright © 2013 Pearson Education 1-31
 For Reflection
Advertisers are often blamed for promoting
a materialistic society by making their
products as desirable as possible.
• Do you agree with this?
• If yes, is materialism a bad thing?
• If no, what are your reasons?

Copyright © 2013 Pearson Education 1-32

 Public Policy & Consumerism
Concern for the welfare of consumers
Department of Agriculture Federal Trade Commission

Food and Drug Securities and Exchange

Administration Commission

Environmental Protection
Agency

Copyright © 2013 Pearson Education

1-33
 Social Marketing
• Social marketing uses marketing
techniques to encourage positive
behaviour and discourage negative
activities.

Copyright © 2013 Pearson Education 1-34

 Positive Behaviour: Increase literacy

Copyright © 2013 Pearson Education 1-35

 Negative Activities: Drunk driving

Copyright © 2013 Pearson Education 1-36

 Green Marketing
• As a response to consumer efforts, many
firms have chosen to protect or enhance
the natural environment as they go
about their business activities.
• This practice is known as green
marketing.

Copyright © 2013 Pearson Education 1-37

 Learning Objective 6
Many specialists study consumer behavior.
MICRO CONSUMER BEHAVIOR
(INDIVIDUAL FOCUS)

Consumer behavior Experimental Psych

involves many different Clinical Psychology
disciplines Developmental Psych
Human Ecology
Microeconomics
Social Psychology
Sociology
Macroeconomics
Semiotics/Literary Criticism
MACRO CONSUMER Demography
History
BEHAVIOR Cultural Anthropology
(SOCIAL FOCUS)
Copyright © 2013 Pearson Education 1-39
 Interdisciplinary influences on the study
of Consumer Behaviour
• There are a lot of researchers from diverse
backgrounds who are into the study of
consumer behavior.
• Which is the “correct” discipline to look into
these issues? Each discipline will give a
different account of its findings and
conclusion.

Copyright © 2013 Pearson Education 1-40

 Learning Objective 7
• There are two major perspectives on
consumer behavior:
• Positivist approach
• Interpretivist approach

Copyright © 2013 Pearson Education 1-41

 Positivism (or Modernism)
• Dominant paradigm
• Trust in science & technology
• Humans are rational decision makers
• The world is a rational place

Example of positivism:
• Diamond is stronger than steel

Copyright © 2013 Pearson Education 1-42

 Interpretivism (or Postmodernism)
• Questions the assumptions of positivism
• Multiple interpretations (symbolic,
subjective experiences and the idea that
meaning is in the mind of the person)
• The world is composed of a pastiche, or
mixture of images. It is culturally & socially
complex.
Example: Volkswagen Beetle advertisement

Copyright © 2013 Pearson Education 1-43

 Table 1.3
Positivist versus Interpretivist Approaches

Assumptions Positivist Approach Interpretivist Approach

Nature of Objective, tangible Socially constructed

reality Single Multiple

Goal Prediction Understanding

Knowledge Time free Time-bound

generated Context-independent Context dependent

View of Existence of real causes Multiple, simultaneous

causality shaping events

Research Separation between Interactive, cooperative

relationship researcher and subject with researcher being
part of phenomenon
under study

Copyright © 2013 Pearson Education 1-45

 Chapter Summary
• Consumer behavior is a process.
• Consumer use products and brands to
define their identity to others.
• Consumers from different segments have
different needs and wants.
• Technology and culture create a new
“always on” consumer.
• There are two major perspectives guiding
our study of consumer behavior.
Copyright © 2013 Pearson Education 1-46