CONSUMER DECISION MAKING PROCESS

Prepared by Eric (nobody) from nowhere

LEARNING OBJECTIVES
1. Explain why marketing managers should understand consumer behavior.

2. Analyze the components of the consumer decision-making process.

3. Explain the consumers post-purchase evaluation process.
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LEARNING OBJECTIVES (CONTINUED)

4. Identify the types of consumer buying decisions and discuss the significance of consumer involvement.

5. Identify and understand the cultural factors that affect consumer buying decisions.

LEARNING OBJECTIVES (CONTINUED)

6. Identify and understand the social factors that affect consumer buying decisions. 7. Identify and understand the individual factors that affect consumer buying decisions. 8. Identify and understand the psychological factors that affect consumer buying decisions.

1ST LEARNING OBJECTIVE

Explain why marketing managers should understand consumer behavior.

CONSUMER BEHAVIOR
Processes a consumer uses to make purchase decisions, as well as to use and dispose of purchased goods or services; also includes factors that influence purchase decisions and the product use.
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2ND LEARNING OBJECTIVE

Analyze the components of the consumer decision-making process.

CONSUMER DECISION-MAKING PROCESS

A five-step process used by consumers when buying goods or services.

STEPS IN THE CONSUMER DECISION-MAKING PROCESS

Need Recognition Information Search Evaluation of Alternatives Purchase Postpurchase Behavior

Cultural, Social, Individual and Psychological Factors affect all steps

A. NEED RECOGNITION

Result of an imbalance between actual and desired states.

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NEED RECOGNITION
Marketing helps consumers recognize an imbalance between present status and preferred state

Internal Stimuli and External Stimuli

Preferred State

Present Status
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STIMULUS
Any unit of input affecting one or more of the five senses: Sight Smell Taste Touch

Hearing
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WHAT DO WE MEAN BY WANT

Recognition of an unfulfilled need and

a product
(or attribute or feature) that will satisfy it.

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RECOGNITION OF UNFULFILLED WANTS

When When When

a current product isnt performing properly. the consumer is running out of an product.

another product seems superior to the one currently used.

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B. INFORMATION SEARCHES
Process of recalling past information stored
in the memory. Process of seeking information in the outside environment.
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Internal

External

INFORMATION SEARCH
Internal Information Search
Recall information in memory

External Information search

Seek information in outside environment

Non-marketing controlled
Marketing controlled
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EXTERNAL INFORMATION SEARCHES

Need Less Information
Less Risk More knowledge More product experience Low level of interest

Need More Information

More Risk Less knowledge Less product experience High level of interest

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EVOKED SET

Group of brands, resulting from an information search, from which a buyer can choose.

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C. EVALUATION OF ALTERNATIVES
Evoked Set
Evaluation of Products:
Analyze product attributes Use cutoff criteria Rank attributes by importance
Chapter 4 Version 3e

Purchase!

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D. PURCHASE

To buy or not to buy...

Determines which attributes are most important in influencing a consumers choice

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3RD LEARNING OBJECTIVE

Explain the consumers Post-purchase evaluation process.

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COGNITIVE DISSONANCE
Inner tension that a consumer experiences after recognizing an inconsistency between behavior and values or opinions.
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E. POST-PURCHASE BEHAVIOR
Cognitive Dissonance

Did I make a good decision?

Did I buy the right product?

Did I get a good value?

Can minimize through: Effective Communication Follow-up Guarantees Warranties

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4TH LEARNING OBJECTIVE

Identify the types of consumer buying decisions and discuss the significance of consumer involvement.

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TYPES OF CONSUMER BUYING DECISIONS

Routine Response Behavior

Limited Decision Making

Extensive Decision Making

Less Involvement

More Involvement
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FIVE FACTORS INFLUENCING DECISIONS

1) Level of consumer involvement 2) Length of time to make decision 3) Cost of good or service

4) Degree of information search

5) Number of alternatives considered

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ROUTINE RESPONSE BEHAVIOR

Little involvement in selection process

Frequently purchased low cost goods

May stick with one brand

Buy first/evaluate later

Quick decision
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LIMITED DECISION MAKING

Low
Low

levels of involvement
to moderate cost goods of a few alternative brands

Evaluation Short

to moderate time to decide

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EXTENSIVE DECISION MAKING

High levels of involvement
High cost goods

Evaluation of many brands

Long time to decide

May experience cognitive dissonance

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LEVEL OF INVOLVEMENT
Previous Experience

Interest

Factors Determining Level of Involvement

Social Visibility

Perceived Risk of Negative Consequences

Situation
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FACTORS INFLUENCING BUYING DECISIONS

Cultural Factors

Social Factors Psychological Factors

Individual Factors

CONSUMER DECISIONMAKING PROCESS

BUY / DONT BUY

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5TH LEARNING OBJECTIVE

Identify and understand the cultural factors that affect consumer buying decisions.

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CULTURE
Set of values norms, attitudes, and other meaningful symbols that shape human behavior and the artifacts, or products, of that behavior as they are transmitted from one generation to the next.
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CULTURAL INFLUENCES ON BUYING DECISIONS

Values Language Myths Customs

Components of American Culture

Rituals Laws Material Artifacts 34

CULTURE IS...
Pervasive
Functional Learned

Dynamic
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VALUES
Enduring belief that a specific mode of conduct is personally or socially preferable to another mode of conduct.

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EG. OF CORE AMERICAN VALUES

Success Materialism Freedom Progress

Core American Values

Youth

Capitalism

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GLOBAL LANGUAGE BLUNDERS

Chevrolets Nova translated to No Go
Coors Turn it Loose became Suffer from Diarrhea Toyotas MR2 sounded like a swearword in French

Coca-Cola in Chinese means bite the wax tadpole

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SUBCULTURE
A homogeneous group of people who share elements of the overall culture as well as unique elements of their own group.

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SOCIAL CLASS
A group of people in a society who are considered nearly equal in status or community esteem, who regularly socialize among themselves both formally and informally, and who share behavioral norms.
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6TH LEARNING OBJECTIVE

Identify and understand the social factors that affect consumer buying decisions.

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SOCIAL INFLUENCES
Social Influences on Buying Decisions

Reference Groups Opinion Leaders

Family Members

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REFERENCE GROUP

A group in society that influences an individuals purchasing behavior.

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REFERENCE GROUPS
Primary Direct Secondary Types of Reference Groups

Aspirational

Indirect
Non-aspirational
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IMPLICATIONS OF REFERENCE GROUPS

They serve as information sources and influence perceptions

They affect an individuals aspiration levels Their norms either constrain or stimulate consumer behavior

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OPINION LEADERS

An individual who influences the opinion of others.

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FAMILY

Instigators Influencers Decision-Makers Purchasers Consumers

Purchase Roles in the Family

Children Influence Purchase Decisions

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7TH LEARNING OBJECTIVE

Identify and understand the individual factors that affect consumer buying decisions.

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INDIVIDUAL INFLUENCES
Individual Influences

Gender Age Family Life Cycle

Personality Self-Concept Lifestyle

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PSYCHOGRAPHICS
The analytical technique used to examine consumer lifestyles and to categorize consumers. This technique is used to understand the role of above individual influences.
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8TH LEARNING OBJECTIVE

Identify and understand the psychological factors that affect consumer buying decisions.

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PSYCHOLOGICAL INFLUENCES
Perception

Motivation

Learning

Psychological Influences on Buying Decisions

Beliefs & Attitudes

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PERCEPTION
Process by which people select, organize, and interpret stimuli into a meaningful and coherent picture.

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PERCEPTION

Selective Exposure

Selective Distortion

Selective Retention
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PERCEPTION
Selective Exposure Consumer notices certain stimuli and ignores others.

Selective Distortion

Consumer changes or distorts information that conflicts with feelings or beliefs.

Selective Retention

Consumer remembers only that information that supports personal beliefs.

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A CONSUMERS SELECTIVE EXPOSURE

Exposure to over 250 advertisement messages per day

Notices only 11 to 20 ads

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MARKETING IMPLICATIONS OF PERCEPTION

Important Higher Brand

attributes

price

names and reliability level of perception

Quality

Threshold Product

changes
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THANK YOU
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