Chapter 6

Analyzing Consumer
Markets

Dr.NguyenThienHung
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Chapter Questions
How do consumer characteristics influence
buying behavior?
What major psychological processes influence
consumer responses to the marketing
program?
How do consumers make purchasing decisions?
How do marketers analyze consumer decision
making?

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Chapter contents
What influences
Key psychological
consumer
processes
behavior?

The buying
Other theories of
decision process:
consumer decision
The five-stage
making
Model

Debates &
discussions.

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 Section 1

What Influences
Consumer Behavior?

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Introductive Example
Crest Used Mobile Phones to Engage Consumers in Its
Irresistibility Campaign (p.189)

Cell Phones are among the newest marketing frontiers for

wireless advertising messages
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What Influences Consumer Behavior?

Social factors

Cultural Personal
Factors factors

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Cultural factors
Culture is the fundamental determinant of a
person’s wants and behaviors acquired through
socialization processes with family and other
key institutions.
Each culture consists of smaller subcultures
that provide more specific identification and
socialization for their members.

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Components of Subcultures

Racial Geographic
Nationalities Religions
groups regions

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Subculture-Based Marketing

David’s BridalTargets the Latino Sub-Culture with its Collection of

Quinceañera Dresses
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Social Classes

Social classes are relatively homogenous and

enduring divisions in a society, hierarchically
ordered and with members who share similar
values, interests, and behavior.

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Social Classes
Upper uppers

Lower uppers

Upper middles

Middle class

Working class

Upper lowers

Lower lowers

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Characteristics of Social Classes
Within a class, people tend to behave alike
Social class conveys perceptions of inferior or
superior position
Class may be indicated by a cluster of variables
(occupation, income, wealth)
Class designation is mobile over time

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Social Factors

Reference
Roles &
groups
status

Family

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Reference Groups

Prim io n a l
ary s pir at
group A ps
s g ro u

a ry Disso
nd ciativ
Seco ps group e
grou s
Membership group

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Family

The family is the most important consumer buying

organization in society, and family members
constitute the most influential primary reference
group.
There are two families in
the buyer’s life.
The Family of Orientation
consists of parents and
siblings
The Family of Procreation
consists of one’s spouse
and children.

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Family – Changing Role Of Women
Radio ShackTargetsWomen with Female Store Managers

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Roles and Status
A Role consists of activities a person is expected to
perform.
Each role carries a status.

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Personal Factors

Age and stage in the life

cycle

Occupation & economic

circumstances

Personality and self-

concept

Lifestyle and values

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Age and stage in the life cycle -The Family Life Cycle

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Occupation and economic circumstances

Occupational so influences consumption

patterns:
A working-class worker will buy work clothes, work
shoes and lunchboxes.
A company executive will buy suits, air travel,
country club memberships.
Economic circumstances: influences the
consumer’s product choice:
Luxury-goods makers such as Gucci, Prada, and
Burberry can be vulnerable to an economic
downturn.
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Personality and self-concept
Each person has personality characteristics
that influence his/her buying behavior.
Personality: a set of distinguishing human
psychological traits that lead to relatively
consistent and enduring responses to environmental
stimuli.
Personality can be an useful variable in analyzing
consumer brand choices.
The idea is that brands also have personalities and
consumers are likely to choose brands whose
personalities match their own.

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Typical personalities
Self-
confidence

Dominance
Adaptability
Sự thống trị

Defensiveness
autonomy
Phòng thủ

Sociability Deference
Hòa đồng Sự tôn trọng

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Brand Personality
Brand personality is the specific mix of human traits that
we can attribute to a particular brand.

Sincerity

Excitement

Competence

Sophistication

Ruggedness
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Personal factor s – self-concept
Self-concept: how we view ourselves
Consumers often choose and use brands that
have a brand personality consistent with:
their own actual self-concept.
Their ideal self-concept (how we would like to view
ourselves)
Other’s self-concept (how we think other see us).

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Lifestyle and values
A lifestyle is a person’s pattern of living in the
world as expressed in Activities, Interests, and
Opinions. It portrays the “whole person”
interacting with his environment.
Marketers search for the relationships between
their products and lifestyle groups (LOHAS
products)

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Lifestyle-based marketing

Table 6.2 LOHAS

(Lifestyles of Health and
Sustainability) Market
Segments
Sustainable Economy
Healthy Lifestyles
Ecological Lifestyles
Alternative Health Care
Personal Development

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Lifestyle and values

Money-
constrained

Time-
constrained

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Core values
Core values are the belief systems that underlie
attitudes and behaviors.
Core values go much deeper than behavior or
attitude and determine, at a basic level,
people’s choices and desires over the long
term.
Marketers who target consumers on the basis
of their values believe that with appeals to
people’s inner selves, it is possible to influence
their outer selves -their purchase behavior.
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 Section 2

Key Psychological
Processes

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Key psychological Processes
Figure 6.1 Stimulus-response Model of Consumer Behavior

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Key Psychological Processes

Motivation Perception Learning Memory

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Motivation

Sigmund Freud Abraham Maslow Frederick Herzberg

(1856 - 1939) (1908 – 1970) (1923 – 2000)
Unconscious Hierarchy of Needs Two-Factor Theory
Theory Behavior is driven Behavior is guided
Behavior is guided by the lowest, by motivating and
by subconscious unmet need hygiene factors
motivation

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Freud’s theory
Psychological forces shaping people’s
behavior are largely unconscious, and
that a person cannot fully understand
his or her own motivations.
Motivation researchers often collect
“in-dept interviews” with a few dozen
consumers to uncover deeper motives
triggered by a product.
The popular technique:
Laddering
Projective techniques: word association,
sentence completion, picture
interpretation, role playing….

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Maslow’s Hierarchy of Needs

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Herzberg’s Two-Factor Theory

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Perception
A motivated person is ready to act.
How she acts is influenced by her view of situation.
Perception is the process by which we select,
organize, and interpret information inputs to create a
meaningful picture of the world.
The key point is that it depends not only on the
physical stimuli, but also on the stimuli’s
relationship to the surrounding field and on
conditions within each of us.
A fast-talking salesperson is perceived as aggressive
and insincere by one person, but intelligent and helpful
by another.
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Three Perceptual processes
People can emerge
with different
perceptions of the
same object because of
the three perceptual
processes:
Selective attention
Sự chú ý có chọn lọc
Selective distortion
Sự bóp méo có chọn lọc
Selective Retention
Sự ghi nhớ có chọn lọc

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Learning
When we act, we learn.
Learning induces changes in our behavior
arising from experience.
Learning theorists believe that learning is
produced through the interplay of drives,
stimuli, cues, responses, and reinforcement.

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Components of learning

• A strong internal stimulus impelling

Drive action

• Minor stimuli that determine when,

Cues where and a person respond

• If the experience is rewarding, the

Reinforcement response will be reinforced

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Memory - short-term and long-term
Cognitive theorists distinguish between:
Short-term memory (STM): a temporary and
limited repository of information.
Long-term memory (LTM): a more permanent,
essentially unlimited repository.

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Associative network memory model
LTM is viewed as a set of nodes and links:
Nodes are stored information connected by links
that vary in strength.
A spreading activation process from node to node
determines how much we retrieve and what
information we can actually recall in any given
situation.
When a node becomes activated because we’re
encoding external information (when we read or
hear a word or a phrase) or retrieving internal
information from LTM (when we think about some
concept), other nodes are also activated if they’re
strongly enough associated with that node.
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Neural Network

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Brand Knowledge in memory
We can think of consumer brand knowledge as
a node in memory with a variety of linked
associations.
The strengths and organization of these
associations will be important determinants of
the information we can recall about the brand.
Brand associations consists of brand-related
thoughts, feelings, perceptions, images,
experiences, beliefs, attitudes, and so on that
become linked to the brand node.
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An Example of brand associations
Figure 6.3 : Hypothetical State Farm Mental Map

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An Application Of Brand Associations
BAHLSEN uses crunchy sounds to encode brand
associations

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 Section 3

The Buying Decision

Process: The Five-stage
Model

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The buying decision process
Figure 6.4 : Five-stage Model Of Consumer Buying Process

Problem Information Evaluation of Purchase Postpurchase

Recognition search alternatives decision behavior

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Problem Recognition
Internal stimulus: one of the person’s normal
needs-hunger, thirst, sex-rises to a threshold
level and becomes a drive.
External stimulus: A person may admire a
neighbor’s new car or see a television ad for a
Hawaii vacation, which triggers thought about
possibility of making a purchase.
Marketers need to identify the circumstances
that trigger a particular need, then develop
marketing strategies that trigger consumer
interest.
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Information Search -Sources of Information

Personal

Commercial

Public

Experiential

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 Information search – Search dynamics
Figure 6.5 Successive Sets Involved in Consumer Decision Making

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Evaluation of alternatives- Beliefs and attitudes

Through experience and learning, people

acquire beliefs and attitudes.
Beliefs is a descriptive thought that a person
holds about something.
Attitudes are a person’s enduring favorable or
unfavorable evaluations, emotional feelings,
and action tendencies towards some object or
idea.

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Evaluation of alternatives- Expectancy-value model
Table 6.4 A Consumer’s Evaluation of Brand Beliefs About Laptops

Supposed weights : 40% 30% 20% 10%

• Computer A = 8.40% + 9. 30% + 6.20% + 9.10% =8.0 (to be chosen)
• Computer B = 7.40% + 7. 30% + 7.20% + 7.10% =7.0
• Computer C = 10.40% + 4. 30% + 3.20% + 2.10% =6.0
• Computer D = 5.40% + 3. 30% + 8.20% + 5.10% =5.0

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Non-Compensatory Models of Choice
The expectancy-value model is a compensatory
model, in that perceived good things can help
to overcome perceived bad things.
Heuristics are rules of thumb or mental
shortcuts in the decision process
Non-compensatory models:
Conjunctive heuristic: consumer sets a minimum
acceptable cutoff level for each attribute (A,B)
Lexicographic heuristic: based on only one
attribute perceived most important (C)
Elimination-by-aspects heuristic: based on one
attribute selected probabilistically.
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Purchase decision
Figure 6.6 Stages between Evaluation of Alternatives and
Purchase
Evaluation of
alternatives

Purchase
intention

Attitudes of Unanticipated
Perceived risk
others situational factors

Purchase decision

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Purchase decision- intervening factors
Attitudes of other:
The intensity of the other person’s negative
attitude toward our preferred alternative.
Our motivation to comply with the other person’s
wishes.
Unanticipated situational factors.
Consumer’s perceived risk.

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Perceived Risk
Functional risk • Not perform up to expectations

Physical risk • threat to physical well-being

Financial risk • not worth the price paid

• resulted in embarrassment from

Social risk others

Psychological • Affecting the mental well-being of

risk the user

• Finding another product because

Time risk of existing product’s failure

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Postpurchase behavior
Postpurchase behavior = dissonance experience
Marketers must monitor:
Consumer’s postpurchase satisfaction.
Consumer’s postpurchase actions
Consumer’s Postpurchase use and disposal

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Post purchase behavior – Use and disposal
Figure 6.7 How Customers Use and Dispose of Products

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 Section 4

Other Theories Of
Consumer Decision Making
SELF-STUDY

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Level of consumer involvement
Consumer involvement is the level of
engagement and active processing the
consumer undertake in response to a marketing
stimulus.
Elaboration Likelihood Model
Low-involvement marketing strategies
Variety-seeking buying behavior

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Decision Heuristics
Availability heuristic
Representativeness heuristic
Anchoring and adjustment heuristic

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Mental Accounting
Mental accounting refers to the way
consumers code, categorize, and evaluate
financial outcomes of choices.
Individuals often segregate their savings into
separate accounts to meet different goals even
though funds from any of the accounts can be
applied to any of the goals
Consumers tend to…
Segregate gains
Integrate losses
Integrate smaller losses with larger gains
Segregate small gains from large losses
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Profiling the customer buying-decision process

The marketer need to learn about the stages in

the buying process for their product by:
Introspective method: To think about how they
themselves would act.
Retrospective method: To interview a small
number of recent purchasers, asking them to recall
the events leading to the purchase.
Prospective method: To locate the consumers
who plan to buy the product and ask them to think
out loud about going through the buying process.
Descriptive method: they ask the consumers to
describe the ideal way to buy the product.
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Profiling the customer buying-decision process

Understanding the customer’s behavior in

connection with a product has been called
mapping:
the customer’s consumption system,
The customer activity cycle
Customer senario.

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 Section 5

Debate And Discussions

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Marketing Debate
• Is target marketing ever bad?
Take a position:
Targeting minorities is exploitive
OR
Targeting minorities is a sound business practice.

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Marketing Discussion
Do you have rules you employ in spending
money?
Do you follow Thaler’s four principles (mental
accounting) in reacting to gains and losses?

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