Presentation on theme: "Why marketing managers should understand consumer behaviour. Marketers use an understanding of consumer behaviour in their efforts to satisfy the needs."— Presentation transcript:
Why marketing managers should understand consumer behaviour. Marketers use an understanding of consumer behaviour in their efforts to satisfy the needs and wants of customers and in their efforts to communicate with customers True 2.False
Analyze the components of the consumer decision- making process. The consumers' decision process begins with Need Recognition and ends with a purchase True 2.False
Consumer's post-purchase evaluation process. Cognitive dissonance is an internal tension that the consumer experiences due to doubts about a purchase decision True 2.False
Types of consumer buying decisions and the significance of consumer involvement. Consumers face three basic categories of decision making: (1) routine response behaviour; (2) limited decision making, and (3) existential decision making True 2.False
Cultural factors that affect consumer buying decisions. With respect to consumer behaviour, marketers recognize culture as one of the most obvious influences on consumer choices True 2.False
Individual factors that affect consumer buying decisions. There are many personal characteristics which influence buying behaviour such as personality, self-concept, lifestyles, gender and others. Marketers can rely on these characteristics to understand consumer behaviour because they are generally stable and if they do change, they change gradually True 2.False
Psychological factors that affect consumer buying decisions. Perception is an important influence on consumer buying decisions that marketers must understand in order to design effective promotional strategies. In particular marketers need to be aware that perception can be affected by the concepts of: selective exposure, selective extortion, and selective retention True 2.False
8 Consumer Decision Making chapter 4
Learning Objectives 1.Explain why marketing managers should understand consumer behaviour. 2. Analyze the components of the consumer decision-making process. 3. Explain the consumer’s postpurchase evaluation process.
Learning Objectives (continued) 4. Identify the types of consumer buying decisions and discuss the significance of consumer involvement. 5. Identify and understand the cultural factors that affect consumer buying decisions.
Learning Objectives (continued) 6. Identify and understand the social factors that affect consumer buying decisions. 7.Identify and understand the individual factors that affect consumer buying decisions. 8. Identify and understand the psychological factors that affect consumer buying decisions.
Consumer Behaviour Processes a consumer uses to make purchase decisions, as well as to use and dispose of purchased goods or services; also includes factors that influence purchase decisions and the product use.
Marketers need to pay very close attention to the study of consumer behaviour because: the internet allows consumers to communicate with each other better than ever. 2.consumers' product and service preferences are constantly changing. 3.there are more consumer groups today than ever before. 4.government legislation requires consumer studies prior to regulatory approvals. 5.their competitors are continually launching new products.
Consumer Decision-Making Process 5 Steps Postpurchase behaviour Postpurchase behaviour Purchase Evaluation of Alternatives Evaluation of Alternatives Information Search Need Recognition Cultural, Social, Individual and Psychological factors affect all steps Cultural, Social, Individual and Psychological factors affect all steps
Marketers recognize that consumers have certain expectations when they make product purchases. Consumers may experience an internal tension after they make a purchase because they have doubts about their decision. This phenomenon is known as: Internal Tension Disorder. 2.Internal Purchase Worry. 3.Post Purchase Depression. 4.Cognitive Dissonance. 5.Post Product Depression.
Information Search Internal External
Evaluation of Alternatives Evoked Set Purchase! Analyze product attributes Rank attributes by importance Rank attributes by importance Use cutoff criteria
Purchase To buy or not to buy... Identifies which attributes are most important in influencing a consumer’s choice
Post-purchase Behaviour Consumers expect certain outcomes from the purchase Satisfied or dissatisfied with the purchase
Cognitive Dissonance Help reduce through: Effective Communication Follow-up Guarantees Warranties Did I make a good decision? Did I buy the right product? Did I get a good value?
Types of Consumer Buying Decisions Routine Response Behaviour Routine Response Behaviour Limited Decision Making Limited Decision Making Extensive Decision Making Extensive Decision Making
All of the following are factors that determine the level of consumer involvement in a purchase decision EXCEPT: perceived risk of negative consequences. 2.situation. 3.social visibility. 4.previous experience. 5.amount of advertising.
Continuum of Consumer Buying Decisions Exhibit 4.2
Routine Response Behaviour Little involvement in selection process Frequently purchased low cost goods May stick with one brand Buy first/evaluate later Quick decision
Limited Decision Making Low levels of involvement (emotional ads work well)emotional ads work well Low to moderate cost goods Evaluation of a few alternative brands Short to moderate time to decide
Extensive Decision Making High levels of involvement High cost goods (image ads help mold buyers)image ads help mold buyers Evaluation of many brands Long time to decide May experience cognitive dissonance
Level of Involvement Situation Social Visibility Interest Perceived Risk of Negative Consequences Previous Experience Factors determining level of Involvement
Marketing Implications of Involvement High-involvement purchases require: Extensive and informative promotion to target market Low-involvement purchases require: In-store promotion, eye- catching package design, and good displays
Factors Influencing Buying Decisions Social Factors Individual Factors Psycho- logical Factors Cultural Factors BUY – DON’T BUY CONSUMER DECISION- MAKING PROCESS
Global Language Blunders Chevrolet’s “Nova” translated to “No Go” Coors “Turn it Loose” became “Suffer from Diarrhea” Toyota’s MR2 sounded like a swearword in French Coca-Cola in Chinese means “bite the wax tadpole”
Multicultural Canada Visible-minority groups –Chinese (23%), Blacks (19%), South Asians (Pakistani and Indian) (19%), Arabs and West Asians (13%), Filipinos and Other Pacific Islanders (8%), Latin Americans (6%), Southeast Asians (5%), and others (7%). Ethnic Diversity
Social Class A group of people in a society who are considered nearly equal in status or community esteem, who regularly socialize among themselves both formally and informally, and who share behavioural norms.
Social Class Exhibit 4.6
Social Class Measurements Wealth Other Variables Income Education Occupation Social Class Measurements Measurements
Social Influences Reference Groups Opinion Leaders Family Members Social Influences on Buying Decisions Courtesy of the Nelson RF Collection
TV Ad TV Ad Relationships among Purchasers and Consumers in the Family Exhibit 4.8
Individual Influences Gender Age Family Life Cycle Personality Self-Concept Lifestyle Personality Self-Concept Lifestyle Individual Influences
Family Life Cycle An orderly series of stages through which consumers’ attitudes and behavioural tendencies evolve through maturity, experience, and changing income and status.
Lifestyle A mode of living as identified by a person’s activities, interests, and opinions. Psychographics is the analytical technique used to examine consumer lifestyles and to categorize consumers Health Canada Ottawa’s Youthography Report
Perception Selective Exposure Selective Distortion Selective Retention Consumer notices certain stimuli and ignores others Consumer notices certain stimuli and ignores others Consumer changes or distorts information that conflicts with feelings or beliefs Consumer remembers only that information that supports personal beliefs
Notices only 11 to 20 ads Exposure to over 250 advertisement messages per day A Consumer’s Selective Exposure
Marketing Implications of Perception Important attributes (price or quality) Brand names Quality and reliability Threshold level of perception Product or repositioning changes
Motivation By studying motivation, marketers can analyze the major forces influencing consumers to buy or not buy products. Motive A driving force that causes a person to take action to satisfy specific needs.
Motivation Physiological Safety Social Esteem Self- Actualization Exhibit 4.10
Changing attitudes Changing beliefs about the brand’s attributes Changing the relative importance of these beliefs Adding new beliefs The Canadian hearing Society
Opinion leadership is one type of important social influence on consumer buying behaviour. Marketers who want to try and manage the impact of opinion leadership need to be aware that: opinion leaders are most influential for established products. 2.opinion leaders need to be different from the group whose opinion they are leading. 3.opinion leaders are usually very wealthy. 4.teenagers are fickle which makes them unsuitable as opinion leaders. 5.locating opinion leaders can be a challenge.
Consumer lifestyles are of particular interest to marketers for understanding consumer behaviour. Psychographics is an analytical technique that is used to examine consumer lifestyles. Marketers undertake lifestyle analysis by examining which of the following: marital status, income, and age. 2.religion, culture, and language. 3.education, income, and occupation. 4.vacations, club membership, and political affiliation. 5.activities, interests, and opinions.
There are a number of important psychological influences on consumer buying decisions including: beliefs and attitudes, perception, motivation, and learning. Marketers need to be keenly aware of all of these influences. The distribution of product samples in consumer mail boxes would most likely be designed to affect which of the following psychological influences: beliefs. 2.attitudes. 3.perception. 4.learning. 5.motivation.