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Consumer Behavior

Models

A model a is simplified
version of reality.

OBJECTIVES
Understand the concept of modeling within
consumer behaviour studies;
Evaluate the applicability of traditional models of
consumer behaviour;
Evaluate the applicability of contemporary models
of consumer behaviour.

Models and theory


Theory: an interrelated set of concepts, definitions
and positions that presents a systematic view of
phenomenon (Loudon and Della Bitta, 1993)
Theory has 4 functions, to:

Types of models
Algebraic models: Fishbeins Attitude Model
n

Ao==biei

i=1

Ao= the persons overall attitude towards the object


bi= the strength of his belief that the object is related to
attribute I (e.g. ASDA is good value for money)
ei= his evaluation or intensity of feelings (liking or disliking)
toward attribute i
n= the number of relevant beliefs for that person

Types of models(contd.)

Types of models(contd.)
Personal Variable Models: Adapted from Ajzens Theoty of Planned
Behaviour( 1991

Types of models(contd.)

Traditional Models of consumers


Early models derive from economics and were
interested in studying how scarce resources are
allocated to quench and unlimited amount of
wants and needs (Loudon and Della Bitta,
1993)
Macroeconomics
Microeconomics

Traditional Models of consumers

MICROECONOMICS
Concentrates on the act of purchasing
Interested in knowing what consumers
were purchasing, ignoring the why and
how underpinning their behaviour.

MICROECONOMICS
Assumptions made:
Consumers wants
unquenchable

and

needs

are

unlimited

and

Consumers allocate their resources to maximise levels of


satisfaction
Consumers have perfect knowledge
The additional satisfaction of a unit that is bought after the
first purchase will be less than the first purchases marginal
satisfaction
Price is key
Consumers rational

Behavioural economics (from Loudon and Della


Bitta, 1993)
George Katona introduces the need to look at
psychological influences guiding consumers behaviour:
behavioural economics
Consumers will purchase products when they have
confidence in the economy (consumer sentiment)

The KatonaModel

Contemporary Models

Nicosia Model (1966)

Limitations
Incomplete in a number of aspects, very reductionist
Variables in the model have not been clearly defined (Rau and
Samiee, 1981)
A number of assumptions have been made that question the
validity of this model, for instance:
What type of consumer are we talking about?
The company and the consumer have an existing
relationship? What type?
Is this for a new product? Is this the first exchange the
consumer has had with the producer?
The model cannot be validated, according to Foxall(1980) it is
pre-scientific

HOWARD-SHETH MODEL

LIMITATIONS
Too many variables, a complex model that can be difficult
to read
Variables in the model have not been clearly defined (Rau
and Samiee, 1981)
A number of assumptions have been made that question
the validity of this model, for instance:
Sharp distinctions between exogenous and other variables have not been
made
The model cannot be generalised, it cannot be applied to co-joint decision
making for example
Can this model be applied for non-branded products?

The model cannot be validated, according to Foxall(1980) it


is pre-scientific

ENGEL-BLACKWELL-MINIARD
MODEL

LIMITATIONS
Too many variables, a complex model that can be difficult to read
Variables in the model have not been clearly defined
The model is vague (Loudon and Della Bitta, 1993)
Key variables are vaguely defined
How do environmental variables affect consumers behaviour?
How do motives influence consumers behaviour?

It is a mechanical overview of human behaviour


Can this model be applied for non-branded products? Goods?
Services?
The model cannot be validated, according to Foxall(1980) it is
pre-scientific

CONCLUTIONS
A model presents phenomena in such a way that it
can be easily communicated
Models are just representative of reality, they are not
reality
There are different types of models (black box,
conceptual, algebraic, personal variable and
comprehensive models)
The Nicosia, Howard-Shethand the Engel, Kollatand
Blackwell model have all been criticised on the
grounds that they are pre-scientific

CONCLUTIONS

Models operate on the assumption


that all human behaviour is rational
All models are mechanistic

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