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PRINCIPLES OF MARKETING

Lecture 4

Consumer Markets
and
Consumer Buyer Behavior
Consumer Buying
Behavior
• Consumer Buying Behavior
refers to the buying behavior of
final consumers (individuals &
households) who buy goods
and services for personal
consumption.
• Study consumer behavior to
answer:
“How do consumers respond to
marketing efforts the company
might use?”
Model of Consumer
Behavior
Product Economic
lO rS
eim
u
th
l
Price eM
tin
rk
ag
O
rS
dM
eim
u
th
tin
e
rk
ad
g Technological
Place Political
Promotion Cultural

Buyer’s B
u k
cxB
o
la
r’s
e
y u
e
y k
co
x
la
r’s Characteristics
Decision Affecting
Process Consumer
Behavior

Product Choice R
B
u o
p
r’s
e
y R
nB
u
e
y n
o
p
r’s Purchase
Timing
Brand Choice
Purchase
Dealer Choice Amount
Characteristics
Affecting
Consumer Behavior
Culture
Social
Personal
Psychological
Buyer
Buyer
Factors Affecting Consumer Behavior:
Culture
• Most basic cause of a person's wants
and behavior.
• Values
• Perceptions
Subculture
Subculture Social
SocialClass
Class
•Groups
•Groupsofofpeople
peoplewith
withshared
shared •People
•Peoplewithin
withinaasocial
socialclass
class
value systems based
value systems based onon tend to exhibit similar buying
tend to exhibit similar buying
common
commonlife
lifeexperiences.
experiences. behavior.
behavior.
•Hispanic
•HispanicConsumers
Consumers •Occupation
•Occupation
•African
•AfricanAmerican
AmericanConsumers
Consumers •Income
•Income
•Asian
•AsianAmerican
AmericanConsumers
Consumers •Education
•Education
•Mature
•MatureConsumers
Consumers •Wealth
•Wealth
R
a
s
le
o
S
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F
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••M b
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••R frn
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Social
Factors Affecting Consumer Behavior:
rs
te
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te
O
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Personal
Factors Affecting Consumer Behavior:
VALS rcR
R
o
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euo
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rc
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2 Actuali tA
A
d
n
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ad
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a
t
Actuali
zers
zers

Fulfille
Fulfille Achiev
Achiev Experi
Experi
ds
ds ers
ers encers
encers

Believe
Believe Striver
Striver Makers
Makers
rs
rs O
n td
rie ss
O
n td
rie O
n td
rie
c P
rinp
le uS
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ta A
n
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Struggl
Struggl
m
MlR
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a m
rcMlR
inu
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a ers
ers
Factors
Factors Affecting
Affecting Consumer
Consumer Behavior:
Behavior:
Psychological
Psychological

Motivation
Motivation

Psychologi
Beliefs
Beliefs and
and cal PPerception
erception
Attitudes
Attitudes Factors

Learning
Learning
Maslow’s Hierarchy of
Needs
Self
Actualization
(Self-development)

Esteem Needs
(self-esteem, status)
Social Needs
(sense of belonging, love)

Safety Needs
(security, protection)

Physiological Needs
(hunger, thirst)
Types of Buying
Decisions

High Low
Involvement Involvement

Significant
differences
iB
o
h
v
a
e
r iB
o
h
v
a
e
r
between
gB
in
u
y S
g
in
k
e
brands m
C
p
o
x
le ty V
rie
a
-

Few
differences B
io
h
v
a
er iB
o
h
v
a
e
r
between R
c
eB
in
u
dg
y gB
in
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brands n
oD
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is
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itu
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Process
The Buyer Decision
The
The Buyer
Buyer Decision
Decision Process
Process
Step
Step 1.
1. Need
Need Recognition
Recognition

Need
Need Recognition
Recognition
Difference
Differencebetween
betweenan
anactual
actualstate
stateand
andaadesired
desiredstate
state

Internal
Internal Stimuli
Stimuli External
External Stimuli
Stimuli
•Hunger
•Hunger •TV
•TVadvertising
advertising
•• ••
•Thirst
•Thirst •Magazine
•Magazinead ad
•• ••
•A
•Aperson’s
person’snormal
normal •Radio
•Radioslogan
slogan
needs
needs ••
•Stimuli
•Stimuliin
inthe
the
environment
environment
The Buyer Decision
Process
Step 2. Information Search
P
o cP
lS
rs
eu
n
aolS
rs
eu
n
c
a •Family, friends, neighbors
•Most influential source of
information

m
C
olS
rc
e u
iam
sC
olS
rc
e u
s
ia •Advertising, salespeople
•Receives most information
from these sources

•Mass Media
sP
S
liP
o
b
u b
uS
o
s
re
lic
re
c
•Consumer-rating groups

sE
p
ta
e
x lS
o
rinu
s
c •Handling the product
•Examining the product
E
p
ta
e
x lS
o
rinu
c
•Using the product
The
The Buyer
Buyer Decision
Decision Process
Process
Step
Step 3.
3. Evaluation
Evaluation of
of Alternatives
Alternatives
Product
ProductAttributes
Attributes
Evaluation
Evaluationof
ofQuality,
Quality,Price,
Price,&&Features
Features

Degree
Degreeof
ofImportance
Importance
Which
Whichattributes
attributesmatter
mattermost
mostto
tome?
me?

Brand
BrandBeliefs
Beliefs
What
Whatdo
doIIbelieve
believeabout
abouteach
eachavailable
availablebrand?
brand?

Total
TotalProduct
ProductSatisfaction
Satisfaction
Based
Basedon
onwhat
whatI’m
I’mlooking
lookingfor,
for,how
howsatisfied
satisfied
would
wouldIIbe
bewith
witheach
eachproduct?
product?
Evaluation
EvaluationProcedures
Procedures
Choosing
Choosingaaproduct
product(and
(andbrand)
brand)based
basedon
onone
one
or more attributes.
or more attributes.
The Buyer Decision
Process
Step 4. Purchase Decision
Purchase
Purchase Intention
Intention
Desire
Desire to
to buy
buy the
the most
most preferred
preferred brand
brand

Attitudes Unexpected
of others situational
factors

Purchase
Purchase Decision
Decision
The
The Buyer
Buyer Decision
Decision Process
Process
Step
Step 5.
5. Postpurchase
Postpurchase Behavior
Behavior

Consumer’s
Consumer’s Expectations
Expectations of
of
Product’s
Product’s Performance
Performance
Product’s Perceived
Performance

Satisfied
Satisfied Dissatisfied
Dissatisfied Customer
Customer
Customer!
Customer!
Cognitive Dissonance
A
o
dp
tinA
o
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tin
p
ria
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A
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s
Process
Stages in the Adoption
Adoption of
Percentage of Adopters
Innovations

Early Majority Late Majority


Innovators

Early
Adopters 34% 34% Laggards

13.5% 16%
2.5% Time of Adoption
Early Late
Influences on the Rate of
Adoption
of New Products
Communicability Relative Advantage
Can results be easily Is the innovation
observed or described superior to existing
to others? products?

Product
Characteristic Compatibility
Divisibility s Does the innovation
Can the innovation fit the values and
be used on a experience of the
trial basis? target market?
Complexity
Is the innovation
difficult to
understand or use?