Feedback

The Managerial Decision Making Process

Need
recognition

Information
search

Evaluation of
alternatives

Purchase
decision

Postpurchase
behavior
A Model of Consumer Behavior
SOCIAL AND GROUP PSYCHOLOGICAL
FORCES FORCES
Culture Motivation
Subculture Perception
Social class Learning
Reference groups Personality
Family and households Attitude

SITUATIONAL
INFORMATION BUYING-DECISION PROCESS
FACTORS
When
Commercial Need recognition consumers buy
sources
Choice of involvement level Where
consumers buy
Identification of alternatives

Evaluation of alternatives

Purchase and related decisions Why

Social sources
consumers buy
Postpurchase behavior Conditions under
which consumers buy
Social Factors
 The Household Influences Most
Consumption Decisions
6-1

Structure
of
household
unit

Household
Stage of
purchases
the Marketing
and
household strategy
consumption
life cycle
behavior

Household
decision
process
 Personal Factors
• Age and Stage in the Lifecycle
• Occupation
• Lifestyle
• Personality
– psychological characteristics that lead to relatively
consistent and enduring responses
– Self-concept vs. ideal self-concept vs. others self-
concept
 Psychological Factors
• Motivation
– psychogenic and biogenic
• Perception
– how a person organizes and interprets information
– selective attention/distortion/retention
• Learning
– changes in an individual’s behavior that arise from experience
• Beliefs and Attitudes
Maslow’s
Hierarchy of
Needs Self-
Actualization
Needs
(Self-fulfillment,
Enriching Experiences)

Esteem Needs
(Accomplishment, Self-Respect, Prestige)

Social Needs (Companionship,

Friendship, Love)

Safety Needs (Protection, Security)

Physiological Needs (Food, Water, Sleep)

Customer Satisfaction Opportunities

Customer
expectations

Customer Opportunities
satisfaction
gap 1. New products
2. Improvements
Actual
product
performance
How Many
Ideas Are
Required for
One
Successful
New Product?
Lead User Analysis
Method for Creating Breakthrough Innovation

How do you
develop
breakthrough
innovation to
grow
organizational
performance?
What Affects the Rate of
Adoption?
Complexity

Compatibility
Characteristics
Characteristics
Affecting
Affecting Relative Advantage
New
New Product
Product
Diffusion
Diffusion
Observability

Trialability
 The Diffusion
Process
Relationship of the Diffusion Process to the
Product Life Cycle
Introduction Growth Maturity Decline
Cumulative Percentage of Adoption

100
Product
90 life cycle
80
curve

70
Early majority
60 Late majority
50
Early adopters
40

30 Innovators
Laggards
20
Diffusion
10
curve
0
Time of Adoption of Innovations
 Customer focus

• A history of carefully listening to customers

• An obsession with producing the best product
possible
• A vision of what the market will like in the
future
• Strong leadership
• A commitment to new-product development
• A team approach to new-product development
Brand Identity: associations that imply a
promise
• Should help in establishing a relationship
between the brand and the customer
– Value proposition
• Functional, emotional or self-expressive
– Credibility
• Endorser’s role
– Brand essence
• Product (scope, quality, uses, users, country of origin)
• Organization (innovation, trustworthy, local/global)
• Personality (genuine, energetic)
• Symbol (visual image, heritage)