1. Final Consumers and Their Buying Behavior
CHAPTER FIVE
Final Consumers and Their Buying Behavior
Chapter Five
Final Consumers and Their Buying Behavior
For use only with Perreault/Cannon/McCarthy or Perreault/McCarthy texts.
© 2008 McGraw-Hill Companies, Inc.
McGraw-Hill/Irwin
For use only with Perreault/Cannon/McCarthy or Perreault/McCarthy texts. © 2008 McGraw-Hill Companies, Inc. McGraw-Hill/Irwin

2. Consumer Behavior for Marketing Strategy Planning (Exhibit 5-1)
Summary Overview
The text’s comprehensive model is referenced to indicate where we are, and what is covered in the following discussion
Key Issues
This chapter explores the influences on final consumers and their buying behavior. :

3. Consumer Behavior for Marketing Strategy Planning (Exhibit 5-1)
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Business
Customers
Final
Consumers
Key Issues
Customers might be either final consumers or organizational customers. We’ll consider final consumers first (chapter 5) and then consider organizational customers in Chapters 6.
There are two types of customers: final consumers, who buy things for their own use, and organizational customers who buy for firms that, in turn, also make products and/or services.
This chapter examines the buying behavior of individual consumers, while Ch 6 builds on our knowledge of individual consumers to look a organizational consumers.
This chapter looks at three key determinants of consumer behavior:
Individual consumer factors
External influences on consumer behavior
The problem-solving and decision-making processes consumers go through.
Economic needs
Psychological
variables
Social influences
Purchase
Situation
Marketing mixes All other stimuli
Consumer decision process
Person making a buying decision
Person does or does not purchase (response) :

4. Income Dimensions of the US Market (Exhibit 5-2)
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Summary Overview
The changes in income patterns have generated considerable debate about their implications for society. Some of these issues also have ethical implications for marketers.
Key Issues
A large share of total U. S. income goes to higher income groups.
The top 20 percent of households receive almost half of the total income in the U. S.
The lowest 20 percent of households receive only four percent of the total U. S. income.
Discussion Question: What kinds of products or services are desired by lower income households more than upper income households?
This great disparity raises the question, “How much income is enough for consumers to meet their needs?”
It also causes some consumer activists and policy makers to suggest that lower income consumers need better protection against exploitation by marketers.

5. How We Will View Consumer Behavior (Exhibit 5-3)
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Marketing mixes All other stimuli
Person Making Decision
Economic needs
Economy of
purchase
Convenience
Efficiency in use
Dependability
Psychological
variables
Motivation
Perception
Learning
Attitude
Personality/
lifestyle
Social influence
Family
Social class
Reference
groups
Culture
Purchase
situation
Purchase reason
Time
Surroundings
Summary Overview
Economics and psychology are often cited as key sources of marketing thought, but marketing also derives a great deal of knowledge about consumer behavior from sociology, anthropology, and other social sciences. The basic model of consumer behavior shown here integrates many of these influences.
Key Issues
Economic needs: those needs that are concerned with the consumer making the best use of his or her time and money.
Psychological variables: things that are going on in the mind of the consumer that affect purchase.
Examples: attitudes, personality, learning processes, and perceptions.
Social influences: have to do with the associations that the buyer might have with other people.
Examples: culture, social class, and family influences.
Purchase situation factors: reason for the purchase, time pressure involved, and surroundings of the purchase.
Discussion Question: How might your purchase of a product be different if you have little time to make your purchase decision as opposed to having unlimited time?
Marketing mixes affect this process.
All other stimuli and influences have an impact on the problem solving process.
Outcome of the process might or might not be a purchase.
Consumer decision process
Person does or does not purchase (response) : : : : :

6. Several Needs at the Same Time: PSSP Hierarchy of Needs (Exhibit 5-5)
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Personal
Needs
Social Needs
Summary Overview
Many different levels of needs can appeal to or motivate a person. The PSSP pyramid shown here helps apply motivation theory to the particular needs of consumers and marketing managers trying to develop marketing mixes to meet those needs.
Key Issues
Physiological needs: the most basic needs people experience.
Examples: biological needs for food, drink, and rest.
Safety needs: concerned with protection and physical well-being.
Examples: health, medicine, exercise.
Social needs: derived from a person’s interactions with others.
Examples: love, friendship, status.
Personal needs: concerned with an individual’s need for personal satisfaction, unrelated to what others do.
Examples: self-esteem, fun, and freedom.
Discussion Question: Can you provide an example of products or services whose marketing mixes attempt to fulfill the four types of needs? NOTE: Some products may try to satisfy only one type of need, while others may attempt to satisfy more than one type.
Safety Needs :
Physiological Needs : : :

7. Attitudes Relate to Buying
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Belief: An Opinion
Belief: An Opinion
Need To Understand Attitudes & Beliefs
Need To Understand Attitudes & Beliefs
Attitude: A Point of View
Attitude: A Point of View
Key
Concepts
Summary Overview
An attitude is a person’s point of view about something. Attitudes tend to be learned. They shape information processing in the consumer’s mind. Attitudes also relate to buying decisions consumers make. Therefore, marketers do a lot of attitude research.
Key Issues
Beliefs: opinions people have about something.
Marketers should try to understand attitudes and beliefs because they can both affect buying.
Discussion Question: Think about the following statements: “I like that LCD computer monitor. It takes up considerably less space on a desktop than a regular monitor.” Which statement is the attitude, and which one is the belief?
Most marketers work with existing attitudes.
Creating new attitudes is difficult.
Attitudes are difficult to change, especially if they are negative.
Ethical issues may arise if marketers promote inaccurate or false beliefs.
Expectations: outcomes or events that a person anticipates.
Understanding and meeting expectations are both important in order to build long-term relationships with customers. :
Meeting Expectations Is Important
Work with Existing Attitudes
Work with Existing Attitudes : :
Ethical Issues May Arise
Ethical Issues May Arise : : :

8. The Family Life Cycle (Exhibit 5-8)
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Summary Overview
Understanding consumers often means looking at families. Family income is important because so many people live in families. Most of their purchase decisions are affected by the family structure and how it changes over time.
Key Issues
In the traditional family life cycle:
People start out as young singles and become young marrieds.
Discussion Question: How does buying behavior change as people move from being young singles to young marrieds? What implications do these changes have for marketers?
Young marrieds have children--becoming “full nest” households.
When the children leave, the parents revert to “empty nest” status.
Empty nesters become married senior citizens and ultimately, sole survivors.
The product life cycle and its variations signal new opportunities, and possibly threats, as consumers move from one stage to the next.

9. Expanded Model of Consumer Behavior (Exhibit 5-9)
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Marketing mixes All other stimuli
Economic needs
Psychological
Variables
Social influences
Purchase
situation
Consumer decision process
Need
awareness
Summary Overview
It is often useful to view the purchase itself as the culmination of several decision steps that solve a problem for the consumer. These steps are affected by the economic, psychological, social, and situational influences already discussed.
Key Issues
1. Awareness: In this stage, consumers become aware of--or interested in--a need, or a problem, and in ways to satisfy the need. If the consumer has faced the same problem in the past and been satisfied with a solution, that solution may be routinely selected again without much thought. Alternatively, the problem-solving decision-process may be more extensive.
2. Problem Solving. Problem solving often involves gathering memories or searching for information from friends, the web, stores or other sources. This helps the consumer identify alternative ways of meeting a need—and also decide what factors—decision criteria—are important in making a decision. Then the consumer evaluates the alternatives and decides which purchase decision would be best.
3. Purchase decision. This decision entails purchasing a product, or perhaps, deciding to postpone a decision and, for now, forgo a purchase.
5. Evaluating the Decision: After purchasing a product, the consumer assesses the experience of his or her decision based on the experience.
Discussion Question: Can you provide an example of a recent purchase you made and what happened at each step of the purchase process?
Purchase
decision
Routinized response
Experience
After the
purchase
Problem Solving
Information search
Identify alternatives
Set criteria
Evaluate alternatives
Postpone decision
Feedback based on experience : : : : :

10. Problem Solving Continuum (Exhibit 5-11)
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Routinized Response Behavior
Low involvement
Frequently purchased
Inexpensive
Little risk
Little information
Extensive Problem Solving
High involvement
Infrequently purchased
Expensive
High risk
Much information desired
Summary Overview
The time, effort, and source of information used in making a purchase can be influenced by the relative level of involvement the consumer experiences.
Key Issues
In extensive problem solving, a consumer attempts to satisfy a completely new or important need.
Much information is needed.
The consumer has no experience.
The decision -- and risk of making a wrong decision -- are important.
These purchases are often referred to as high involvement purchases.
In limited problem solving, the consumer is willing to put forth some effort, perhaps to update or add to previous experience or because the problem is moderately important.
In routinized response behavior, a consumer resorts to habit to solve a problem.
These purchases are often referred to low-involvement purchases that have little importance or relevance to the consumer.
Discussion Question: Think about three purchases you have made--involving extensive problem solving, limited problem solving, and routinized response behavior, respectively. How did the purchase process differ across the three purchases?
Limited Problem Solving :
Low involvement
High involvement : :

11. Adoption Process Steps
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Awareness
Interest
Awareness
Interest
Evaluation
Evaluation
Trial
Summary Overview
Many new product concepts require an adoption process. In these situations, consumers may pass through a series of steps used to investigate and evaluate, and ultimately accept or reject, an idea or product as a solution to their problem.
Key Issues
1. In the awareness stage, the potential customer first learns about the existence of a product but may lack more details.
2. If the interest stage is reached, the consumer will gather general information and facts about the product.
Discussion Question: Would selective processes (described earlier) have an impact on whether or not the consumer reaches the interest stage? Explain.
3. In evaluation, the consumer gives the product a mental trial, applying it to his or her own personal situation.
4. In trial, the consumer may buy the product to experiment with it in use.
5. The consumer ultimately makes a decision--on either adoption and continued use, or rejection of the product from further consideration.
6. After the decision, there is confirmation. Here the adopter continues to rethink the decision and searches for further support that it was correct.
Dissonance may set in after the decision--tension caused by uncertainty about the rightness of a decision.
Dissonance may set in after the decision!
Trial
Decision :
Confirmation
Decision : : : : : :

12. Decision Making
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Decision-making steps Adoption process steps Learning steps
Becoming aware of need
Gathering info about choices
Setting criteria, evaluation, possible trial
Deciding on the solution
Evaluating the purchase experience
Awareness and interest
Interest and evaluation
Evaluation, maybe trial
Decision
Confirmation
Drive
Cues
Response
Summary Overview
It is important to see the interrelation of :
the decision-making process,
the adoption process, and
learning.
Knowing how target markets handle these processes helps companies with their marketing strategy planning.
Key Issues
Marketers can affect the interrelation; promotion, for example, can modify or accelerate the interrelation. Problem-solving behavior also affects distribution--consumers expect to have easier access to products and services that involve routinized response behavior. Customer attitudes affect price sensitivity, which in turn, influences the prices that marketers charge.
Discussion Question: How is dissonance related to reinforcement? How can marketers influence dissonance and reinforcement?
There is a tremendous temptation for marketers to substitute their own personal knowledge and experiences--derived from their own purchases--for an understanding of the target market as a whole. Such thinking is particularly problematic the farther the target customers are from the marketer, or the more differences there are between the marketer and the target audience. :
Reinforcement : :