Chapter 5

Consumer
Behavior:
Consumer Markets
and Consumer
Buyer Behavior
Consumer Markets and Consumer
Buyer Behavior
Topic Outline
• Model of Consumer Behavior
• Characteristics Affecting Consumer
Behavior
• Types of Buying Decision Behavior
• The Buyer Decision Process
• The Buyer Decision Process for New
Products

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 Model of Consumer Behavior

Consumer buyer behavior refers to the buying

behavior of final consumers, individuals and
households who buy goods and services for
personal consumption
• Discussion: What have you recently
purchased that cost over $100? Why?
Consumer market refers to all of the personal
consumption of final consumers
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Model of Consumer Behavior

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 Model of Consumer Behavior

Stimulus Response Model

• Marketing and other stimuli enter the
buyer’s “black box” and produce certain
choice & purchase responses
• Marketers must figure out
what is inside of the buyer’s
“black box” and how stimuli
?
become responses
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 Characteristics Affecting
Consumer Behavior
Factors Influencing Consumer Behavior

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 Characteristics Affecting
Consumer Behavior
Culture is the learned values, perceptions,
wants, and behaviors learned by a member
of society from family and other important
institutions
Example: McDonalds
adaptation to
Middle Eastern
culture (separate
men’s/women’s
seating & McArabia)
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 Characteristics Affecting
Consumer Behavior
Subculture are groups of people within a
culture with shared value systems based on
common life experiences and situations
Groups might
be based on:
• Nationality
• Religion
• Race
• Geographic
Area 5-8
 Cultural Factors
Prof. Hofstede defined five dimensions to
analyze and compare cultures across the
world. Using research conducted in Egypt,
Iraq, Kuwait, Lebanon, Libya, Saudi Arabia, and
the UAE, he developed a measure of the Arab
world. The five dimensions are:
• Power Distance Index (High)
• Uncertainty Avoidance Index (High)
• Individualism (Low)
• Masculinity (High)
• Long-Term Orientation (High-Collectivist)
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 Characteristics Affecting
Consumer Behavior
Cultural Factors
Social classes are society’s relatively permanent
and ordered divisions whose members share
similar values, interests, and behaviors
• Measured by a combination of occupation,
income, education, wealth, and other
variables
• People within a social class exhibit similar
behavior including similar buying behavior
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 Characteristics Affecting
Consumer Behavior
Cultural Factors — An Arab Example:
Social Classes in the UAE
Nationals Foreign immigrants
Al-Muwateneen Al-Wafedeen
• Ruling Sheikhly Families • Top Professionals and
• The Merchant Class International
• New Middle Class Contractors
• • Middle Range
Low Income Groups
Professionals
• Low-paid, Semi-skilled
and Unskilled workers

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 Characteristics Affecting
Consumer Behavior
Groups and Social Networks

Membership Aspirational Reference

Groups Groups Groups
•Groups with •Groups •Groups that
direct form a
an comparison or
influence, to
which a
individual reference in
forming
person wishes to attitudes or
belongs belong to behavior

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 Characteristics Affecting
Consumer Behavior
Groups and Social Networks
Word-of-mouth influence and
buzz marketing
• Opinion leaders (or
influentials or leading
adopters) are people within
a reference group with
special skills, knowledge or
personality who exert social
influence on others
• Marketers identify them to use as brand
ambassadors (buzz marketing) 5 - 13
GUESS knows
that teens are
strongly
influenced by
groups when
purchasing
fashion items

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Characteristics Affecting Consumer Behavior

Groups and Social Networks

Online Social Networks are

online communities where
people socialize or exchange
information and opinions
• Include blogs, social
networking sites
(Facebook), virtual worlds
(second life)
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 Characteristics Affecting
Consumer Behavior
Social Factors
Family is the most important consumer-buying
organization in society
• Discussion: What brands do you purchase
because it is what your parents use? Why?
Social roles and status are the groups, family,
clubs, and organizations that a person
belongs to that can define role and social
status
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 Characteristics Affecting
Consumer Behavior
Personal Factors
Age and life-cycle stage:
• People change the goods and services they
buy over their lifetimes
• Tastes in food, clothes, furniture, and
recreation are often age related
• Buying is also shaped by the stage of the
family life-cycle—the stages through which
families might pass as they mature over time
(young singles…empty nesters, retired) 5 - 17
 Characteristics Affecting
Consumer Behavior
Personal Factors
Occupation affects the goods and services
bought by consumers
Economic situation includes trends in:
Personal
income Savings

Interest
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 Characteristics Affecting
Consumer Behavior
Personal Factors
Lifestyle is a person’s pattern of
living as expressed in his or her
psychographics (AIO’s)
• Activities (work, shopping,
hobbies etc.)
• Interests (food, fashion,
recreation, sports, etc.)
• Opinions (about themselves,
social issues, business, etc.)
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Jeep targets
people who want
to “leave the
civilized world
behind”

What other types

of images could
be used to
appeal to this
lifestyle?

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 Characteristics Affecting
Consumer Behavior
Personal Factors
Personality and self-concept
• Personality refers to the unique psychological
characteristics that lead to consistent and
lasting responses to one’s environment (Self-
confidence, sociability, aggressiveness…)
• Self-concept or self-image is the idea that
people’s possessions contribute to and reflect
their identities—that is, ‘we are what we
have’
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 Characteristics Affecting
Consumer Behavior
Brand Personality
A brand personality is the specific mix of human
traits that may be attributed to a particular brand

Sincerity: Honest, genuine, and cheerful

Excitement: Daring, lively and imaginative

Competence: Reliable, intelligent and successful

Sophistication: Upper class and charming

Ruggedness: Tough and outdoorsy

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 Characteristics Affecting
Consumer Behavior
Psychological Factors

Motivation

Perception

Learning

Beliefs and attitudes

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 Characteristics Affecting
Consumer Behavior
Psychological Factors
Motivation
A motive is a need that is sufficiently pressing
to direct the person to seek satisfaction
Motivation research refers to qualitative
research designed to probe consumers’
hidden and subconscious motivations (Freud)
• For example, why does an aging consumer
buy a sporty convertible?
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 Characteristics Affecting
Consumer Behavior
Maslow’s
Hierarchy of Needs
Abraham Maslow
ordered human
needs in a hierarchy
from most pressing
to least pressing

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 Characteristics Affecting
Consumer Behavior
Psychological Factors
Perception is the process by
which people select, organize,
and interpret information to
form a meaningful picture of
the world from three
perceptual processes
• Selective attention
• Selective distortion
• Selective retention
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 Characteristics Affecting
Consumer Behavior
Psychological Factors
Selective attention is the tendency for people to
screen out most of the information to which
they are exposed
Selective distortion is the tendency for people to
interpret information in a way that will
support what they already believe
Selective retention is the tendency to remember
good points made about a brand they favor
and forget good points about competing
brands 5 - 27
 Characteristics Affecting
Consumer Behavior
Psychological Factors
Learning is the change in an individual’s
behavior arising from experience and
occurs through interplay of:

Drives Stimuli

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 Characteristics Affecting
Consumer Behavior
Psychological Factors
Beliefs and Attitudes
Belief is a descriptive thought that a person
has about something based on:
• Knowledge
• Opinion
• Faith

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 Characteristics Affecting
Consumer Behavior
Psychological Factors
Beliefs and Attitudes
Attitudes describe a person’s
relatively consistent
evaluations, feelings, and
tendencies toward an
object or idea (positive,
undecided or negative)
Difficult to change
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 Types of Buying Decision Behavior
• Complex buying behavior
– Highly involved, significant brand differences:
Purchasing a laptop computer
• Dissonance-reducing buying behavior
– Highly involved but see little brand differences:
Purchasing car insurance
• Habitual buying behavior
– Low involvement, little brand differences:
Purchasing bottled water
• Variety-seeking buying behavior
– Low involvement, significant perceived brand
differences: Purchasing cookies
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Types of Buying Decision Behavior

• Complex, High Involvement Purchase

– Consumers may be highly involved
when the product is:
• Expensive
• Risky
• Purchased infrequently
• Highly self-expressive

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Types of Buying Decision
Behavior
Four Types of Buying Behavior

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 The Buyer Decision Process

Buyer Decision Making Process

1 2 3 4 5

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 The Buyer Decision Process

Step 1: Need Recognition

Need recognition occurs when the buyer

recognizes a problem or need triggered by:
• Internal stimuli: Normal needs become
strong enough to drive behavior
• External stimuli:
‒ Advertisements
‒ Friend’s comments 5 - 35
 The Buyer Decision Process
Step 2: Information Search
Heightened Attention or Active Search:
Sources of Information
• Personal sources—family and friends
• Commercial sources—advertising, Internet
• Public sources—mass media, consumer
organizations
• Experiential sources—
handling, examining,
using the product
• Word-of-mouth
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 The Buyer Decision Process
Step 3: Evaluation of Alternatives
How the consumer processes information to
arrive at brand choices
Depends on the individual consumer and the
specific buying situation
Most buyers evaluate multiple attributes, each
of which is weighted differently.
At the end of the evaluation stage, purchase
intentions are formed
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 The Buyer Decision Process

Step 4: Purchase Decision

The act by the consumer to buy the most

preferred brand.
The purchase decision can be affected by:
• Attitudes of others
• Unexpected situational factors

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 The Buyer Decision Process
Step 5: Post-Purchase Decision
• The satisfaction or dissatisfaction that the
consumer feels about the purchase
• Relationship between:
– Consumer’s expectations
– Product’s perceived performance
• The larger the gap between expectation and
performance, the greater the consumer’s
dissatisfaction
• Cognitive dissonance is the discomfort caused
by a post-purchase conflict (buyer’s
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 The Buyer Decision Process
Post-Purchase Decision

Customer satisfaction is a key to building

profitable relationships with consumers—
to keeping and growing consumers and
reaping their customer lifetime value
• Delighted customers engage in positive
word-of-mouth
• Unhappy customers tell, on average, 11
other people
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 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
Adoption process is the mental process an
individual goes through from first learning
about an innovation to final regular use
• Five stage process:
1 2 3 4 5
Awareness Interest Evaluation Trial Adoption

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5 Stages in the New Product Adoption Process

1. Awareness: Become aware of new product

but lack info
2. Interest: Stimulated to seek info about new
product
3. Evaluation: Consider trying the product
4. Trial: Try product on a small scale to
estimate value
5. Adoption: Make full & regular use of the
new product
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 Individual Differences in Innovativeness:
Adopter Categories
• Innovators
– Try new ideas at some risk
• Early adopters
– Adopt new ideas early but carefully
– Are opinion leaders in their community
• Early Majority
– Deliberate, but adopt before the average person
• Late Majority
– Skeptical
• Laggards or Traditionalists
– Suspicious of changes
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The Buyer Decision Process for
New Products
Individual Differences in Innovativeness

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Influence of Product Characteristics on Adoption Rate
• Relative Advantage
‒ Apparent superiority to existing products
• Compatibility
‒ How does it fit the values & experiences of
potential customers?
• Complexity
‒ How difficult to understand or use?
• Divisibility
‒ Can it be tried on a limited basis?
• Communicability
‒ Can results be observed or described to
others? 5 - 45
 Discussion
Why might the adoption
process be slow for a
home robot?
 Relative Advantage?
 Compatibility?
 Complexity?
 Divisibility?
 Communicability?

Source: Business Week 5 - 46