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Priciples of Marketing

by Philip Kotler and Gary Armstrong

Chapter 5
Managing Marketing Information to
Gain Customer Insights

PEARSON
Objective Outline

Model of Consumer Behavior


Define the consumer market and construct a simple
1
model of consumer buyer behavior.

Characteristics Affecting Consumer Behavior


Name the four major factors that influence consumer
2
buyer behavior.
Objective Outline

Types of Buying Decision Behavior


3 The Buyer Decision Process
List and define the major types of buying decision
behavior and the stages in the buyer decision process.

The buyer decision Process for New Products


4 Describe the adoption and diffusion process for new
products.
Model of Consumer Behavior

Consumer Buyer Behavior


Consumer buyer behavior refers to the buying
behavior of final consumers ─ individuals and households
that buy goods and services for personal consumption. All of
these final consumers combine to make up the consumer
market.
Model of Consumer Behavior

We can measure the whats, wheres, and whens of consumer buying


behavior. But it’s very difficult to “see” inside the consumer’s head
and figure out the whys of buying behavior (that’s why we call
black box). Marketers spend a lot of time and dollars trying to
figure out what makes customers tick.
Characteristics Affecting Consumer
Behavior
Cultural Factors

Culture
Factors

Social
Culture Subculture
Class
Culture

Every
Culture is the
group
Marketers orset
are of basic
society
always hasvalues, perceptions,
a culture,
trying to spot and wants,
cultural
cultural shifts so
and behaviors
influences
as to discover learned
on buying by a member
behavior
new products of society
maymight
that vary greatlyfrom
be wanted.
family
from andcountry
both other important
to countyinstitutions.
and country to country.
Subculture  Many marketers now embrace cross-cultural
 They tend to be deeply family─oriented
marketing the practice of including
and make shipping ethnic
a family
affair ─ children havethemes bigand cross-cultural perspectives
buy. within
 aAsian say in what brands
Americans are thetheysecond-

 Each
Older,culture
Althoughcontains
their smaller
mainstream
moreHispanic
first-generation price conscioussubcultures,
marketing.
than other
fastest-growing subsegment after brand
consumers tend to be or
very
groups
loyal andof  brands
to people
segments,
favor Cross-cultural
with
blacks shared
are
and also marketing
sellers value
strongly
who appeals
systems
motivated
show to consumer
special based in
interest
Hispanic Americans.
them.
on common lifesimilarities
by quality and
experiences across subcultures rather than
selection.
 Asian and shop
consumers situations.
frequently and
 Younger Brands differences.
are important.
Hispanics, however,
are thehave
mostshown
brand increasing
conscious of price
all the
 Inin
sensitivity  years,
recent
recentMany
years marketers
many are finding
acompanies
and groups.
willingness have that insights
to switch to store brands.
ethnic
 Within the Hispanicgleaned
developed special
market, from ethnic
products,
there consumers
appeals,
exist many and cansubsegments
distinct
 They can be fiercely brand loyal.
influence
based onmarketing their broader
nationality,programs
age, formarkets.
income, them.
and other factors.

Hispanic African Asian Cross


American American American Cultural
Consumers Consumers Consumers Marketing
Social Class

 Social classes are society’s relatively permanent


and ordered divisions whose members share
similar values, interests, and behaviors.
Social Factors

Small
groups

Social
Status Factors Family

Social
roles
Groups and Social Networks
 A group is two or more people who interact to
accomplish individual or mutual goals.
 Reference groups serve as direct or indirect points of
comparison or reference in forming a person’s attitudes or
behavior.
 Reference groups expose a person to new behaviors and
lifestyles, influence the person’s attitudes and self-
concept, and create pressures to conform that may affect
the person’s product and brand choices.
Groups and Social Networks

 Word-of-Mouth Influence and Buzz Marketing.

Opinion Leader
Word-of-Mouth Influence
 A person withinBuzz Marketing
a reference group who, because of
 The impact of the personal words and
 Involves enlisting
special skills, or even personality,
knowledge, creating opinion leaders
or other
recommendations of trusted friends, associates,
to serve as “brand
characteristics, ambassadors”
exerts who spread
social influence the
on others.
and other consumers on buying behavior.
 word
Some about a company’s
experts products.
call this group the influentials or
 Most word-of-mouth influence happens naturally:
 Many
leadingcompanies
adopters. are now turning everyday
Consumers start chatting about a brand they use or
 customers
Marketers into
try tobrand evangelists.
identify opinion leaders for their
feel strongly about one way or the other.
products and direct marketing efforts toward them.
Groups and Social Networks

 Online Social Networks.


• They are online communities where people socialize or
exchange information and opinions.
• Social networking media range from blogs and message
boards to social networking Web sites and virtual worlds.
• This new form of consumer-to-consumer and business-
to-consumer dialog has big implications for marketers.
Family

 The family is the most important consumer


buying organization in society, and it has been
researched extensively.
 Husband-wife involvement varies widely by
product category and by stage in the buying
process.
 Buying roles change with evolving consumer
lifestyles.
Roles and Status

 A role consists of the activities people are


expected to perform according to the people
around them.
 Each role carries a status reflecting the general
esteem given to it by society.
 People usually choose products appropriate to
their roles and status.
Personal Factors
Age and
life-cycle
stage

Personality
and self- Occupation
concept
Personal
factors

Economic
Lifestyle
situation
Age and Life-Cycle Stage
 Buying is also shaped by the stage of the family life cycle
─ the stages through which families might pass as they
mature over time.
 Marketers often define their target markets in terms of
life-cycle stage and develop appropriate products and
marketing plans for each stage.
Occupation
 A person’s occupation affects the goods and services
bought.
 Marketers try to identify the occupational groups that
have an above-average interest in their products and
services.
 A company can even specialize in making products
needed by given occupational group.
Economic Situation
 A person’s economic situation will affect his or her store
and product choices.
 Marketers watch trends in personal income, savings, and
interest rates.
 In the more frugal times following the Great Recession,
most companies have taken steps to redesign, reposition,
and reprice their products and services.
Lifestyle
 Lifestyle is a person’s pattern of living as expressed in his
or her activities, interests, and opinions.
 It involves measuring consumers’ major AIO dimensions
─ activities, interests, and opinions.
 It can help marketers understand changing consumer
values and how they affect buyer behavior.
Personality and Self-Concept
Sincerity (down-to-earth, honest, wholesome
 Personality refers to the unique
, and psychological
cheerful)
characteristics that distinguish a person or group.
 Personality is usually described
Excitementin(daring,
terms ofspirited, imaginative,
traits such as
and up-to-date)
self-confidence, dominance, sociability, autonomy,
One researcher
defensiveness, adaptability, and aggressiveness.
identified five Competence (reliable, intelligent, and
 brand
Brand personality
personalityis the specific mix of human traits that
successful)
may betraits:
attributed to a particular brand.

Sophistication (upper class and charming)

Ruggedness (outdoorsy and tough)


Psychological Factors
Motivati
on

Beliefs Psycholo
Percepti
and gical
on
attitudes factors

Learnin
g
Motivation
 A motive (drive) is a need that is sufficiently pressing to
direct the person to seek satisfaction.
 Motivation researchers use a variety of probing
techniques to uncover underlying emotions and attitudes
toward brands and buying situations.
 But many marketers use such touchy-feely approaches,
now sometimes called interpretive consumer research, to
dig deeper into consumer psyches and develop better
marketing strategies.
Motivation
Perception
 All of us
Selective Attention
by the flow of information through our five
senses:
The tendency for peoplesmell,
sight, hearing, to screen
touch, and taste.
out most of the information to
 Perception is the
which they are process by which
Selective
exposed Retentionpeople select,
organize, and
Means that  interpret
Consumers
marketers are likely totoremember
information
must work form a meaningful
picture of the
especially good
hardworld. points
to attract themade about a brand
consumer’s they favor and forget food points
attention
 People can form different
made perceptions
about competing of the same
brands.
stimulus because of three perceptualSelective
processes:Distortion
selective
attention, selective distortion,and selective
Describes theretention.
tendency of people to
interpret information in a way that
will support what they already
believe.
Learning

 Learning
• Describes changes in an individual’s behavior arising
from experience.
• Occurs through the interplay of drives, stimuli, cues,
responses, and reinforcement.
 Drive
• A strong internal stimulus that call for action
• A drive becomes a motive when it is directed toward a
particular stimulus object.
Beliefs and Attitudes

• A descriptive thought that a person has about


 Attitudes are difficult to change.
something
 A person’s attitudes fit into a pattern; changing one
Belief
• Based on real knowledge, opinion, or faith
attitude may require difficult adjustments in many
and may or may not carry an emotional charge
others.
 A company should usually try to fit its products into
• Describes a person’s relatively consistent
existing attitudes rather than attempt to change
Attitude evaluations, feelings, and tendencies toward
attitudes.
an object or idea
Types of Buying Decision Behavior

Complex Buying Behavior Habitual Buying Behavior


• Consumers are highly involved in • Occurs under conditions of
a purchase and perceive low-consumer involvement
significant differences among and little significant brand
brands. difference

Variety-Seeking Buying Dissonance-Reducing Buying


Behavior Behavior
• Occurs in situations • Occurs when consumers are
characterized by low highly involved with an
consumer involvement but expensive, infrequent, or risky
significant perceived brand purchase but see little difference
differences among brands
The Buyer Decision Process

Need
recogniti
on

Postpurc Informat
hase ion
behavior Buyer search
decision
process

Evaluati
Purchas on of
e alternati
decision ves
Need Recognition
 The buying process starts with need recognition ─ the
buyer recognizes a problem or need.
 The need can be triggered by internal stimuli when one of
the person’s normal needs ─ for example, hunger or thirst
─ rises to a level high enough to become a drive.
 A need can also be triggered by external stimuli.
Information Search
 Information search is the stage of the buyer decision
process in which the consumer is motivated to search for
more information.
 Traditionally, consumers have received the most
information about a product from commercial sources
that controlled by the marketer.
 The most effective sources tend to be personal.
 Commercial sources normally inform the buyer, but
personal sources legitimize or evaluate products for the
buyer.
Evaluation of Alternatives

 The alternative evaluation is the stage of the


buyer decision process in which the consumer
uses information to evaluate alternative brands in
the choice set.
 Marketers should study buyers to find out how
they actually evaluate brand alternatives.
Purchase Decision
 The purchase decision is the buyer’s decision about
which brand to purchase.
 But two factors can come between the purchase intention
and the purchase decision.
 The first factor is the attitudes of others.
 The second factor is unexpected situational factors.
Postpurchase Behavior

 The postpurchase behavior is the stage of the


buyer decision process in which consumers take
further action after purchase, based on their
satisfaction or dissatisfaction.
 Almost all major purchases, however, result in
cognitive dissonance, or discomfort caused by
postpurchase conflict.
The Buyer Decision Process for New
Products
 A new product is a good, service, or idea that is
perceived by some potential customers as new.
 We define the adoption process as the mental process
through which an individual passes first learning about an
innovation to final adoption.
 Adoption is the decision by an individual to become a
regular user of the product.
Stages in the Adoption Process
 Five stages in the process of adopting a new product:
• The consumer becomes aware of the new
Awareness product but lacks information about it.

• The consumer seeks information about the


Interest new product.

• The consumer considers whether trying the


Evaluation new product makes sense.

• The consumer tries the new product on a


Trial small scale to improve his or her estimate of
its value.

• The consumer decides to make full and


Adoption regular use of the new product.
Individual Differences in Innovativeness
Early
adopters
 In each product
Innovatorsarea, there are “consumption
Lagging They are guided by
pioneers”
They areand early adopters.
venturesome adopters respect ─ they are
─ they try new ideas at opinion leaders in their
They are traditional bound ─
some risk. communities and adopt
they are suspicious of changes
new ideas early but
and adopt the innovation only
carefully.
Early when it has become something
mainstreamof a tradition itself.
Late
They are guided by mainstream
respect ─ they are
They adopt an
opinion leaders in their
innovation only after a
communities and adopt
majority of people
new ideas early but
have tried it.
carefully.
Influence of Product Characteristics on
Rate of Adoption
 Five characteristics are especially important in
influencing an innovation’s rate of adoption.
• Relative advantage
• Compatibility
• Complexity
• Divisibility
• Communicability
The End