1. CHAPTER FIVE Consumer markets & consumer buying behavior
Lecturer: NNA 1

2. Chapter Learning Outcomes
Topic Outline
5.1 Model of Consumer Behavior
5.2 Characteristics Affecting Consumer Behavior
5.3 Types of Buying Decision Behavior
5.4 The Buyer Decision Process
5.5 The Buyer Decision Process for New Products
Ch 5 -2
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3. Copyright © 2011 Pearson Education
Consumer Behavior
Consumer Buyer Behavior and Consumer Market
Consumer buyer behavior refers to the buying behavior of final consumers—individuals and households who buy goods and services for personal consumption.
Consumer market refers to all of the personal consumption of final consumers.
Ch 5 -3
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Note to Instructor
Discussion Question
What have you recently purchased that cost over $100? Write down all the reasons you purchased this particular item.
Because students are all consumers—it is interesting to start the class with a discussion of products they have recently purchased. When you ask them why they purchased a particular item or product, you can bring them through many topics in this chapter including the characteristics that affect consumer behavior (cultural, social, personal, and psychological). You can also try to determine the process they went through including how and where they searched for information and how they evaluated their alternatives. Finally, ask them how they feel about their purchase (postpurchase behavior). This discussion will lead nicely to the next slide which is the Model of Buyer Behavior.

4. Model of Consumer Behavior
STIMULI
PROCESSING
RESULT
Ch 5 -4
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5. Characteristics Affecting Consumer Behavior
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6. Characteristics Affecting Consumer Behavior
Cultural Factors
Culture is the set of basic values, perceptions, wants, and behavior learned from family and other important institutions.
e.g: Asian Culture
African Culture
Arab Culture
American Culture
Chinese Culture etc.
Subculture are groups of people within a culture with shared value systems based on common life experiences and situations.
e.g: Hispanic Subculture in American culture
Note to Instructor
Real Marketing 5.1 discusses McDonald’s challenges in the Arab world. McDonald’s is currently operating in 14 Arab countries. A key element in McDonald’s strategy is to adapt its traditional American approach to local culture, food habits, and lifestyles.
For example, in some countries of the Arab world, McDonald’s outlets are divided along male and female lines in accordance with local custom. As well as adapting the restaurants themselves, McDonald’s tailors its menu to meet the food culture or preferences of different countries. The McDonald’s menu varies widely in different parts of the world. In the Arab world, for example, the company launched ‘McArabia,’ a product that McDonald’s intended to match regional tastes and preferences.
Ch 5 -6
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7. 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.
Cross cultural marketing is the practice that includes ethnic themes & cross cultural perspectives within their mainstream marketing.
Note to Instructor
Real Marketing 5.1 discusses McDonald’s challenges in the Arab world. McDonald’s is currently operating in 14 Arab countries. A key element in McDonald’s strategy is to adapt its traditional American approach to local culture, food habits, and lifestyles.
For example, in some countries of the Arab world, McDonald’s outlets are divided along male and female lines in accordance with local custom. As well as adapting the restaurants themselves, McDonald’s tailors its menu to meet the food culture or preferences of different countries. The McDonald’s menu varies widely in different parts of the world. In the Arab world, for example, the company launched ‘McArabia,’ a product that McDonald’s intended to match regional tastes and preferences.
Ch 5 -7
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8. Characteristics Affecting Consumer Behavior
Social Factors
Groups and Social Networks
Membership Groups
Groups with direct influence and to which a person belongs
Aspirational Reference Groups
Groups an individual wishes to be like
Associative Reference Groups
Groups include people who more realistically represent the individuals’ current equals or near-equals
Dissociative Reference Group
group includes people that the individual would not like to belong to
Note to Instructor
Discussion Question
What groups are you a member of and what are your aspirational groups. How does this influence you as a consumers?
Ch 5 -8
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Reference: University of South California

9. Characteristics Affecting Consumer Behavior
Social Factors
Word-of-mouth influence and buzz marketing
Opinion leaders are people within a reference group who exert social influence on others
Also called influentials or leading adopters or early adopters
Marketers identify them to use as brand ambassadors
Buzz Marketing: Enlisting / creating opinion leaders & use them as brand ambassadors
Word of Web
Note to Instructor
It is a great idea to click through to the BuzzParadise Web site. It is an excellent example of Buzz marketing. Ask students if they tend to have a “go to” person when they want to purchase. Would they consider themselves opinion leaders? A great group to ask about is middle school aged kids. Who are the opinion leaders here? What qualities do they possess?
Ch 5 -9
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10. Characteristics Affecting Consumer Behavior
Social Factors
Online Social Networks are online communities where people socialize or exchange information and opinions:
Blogs
Social networking sites (Facebook)
Virtual worlds (Second Life)
Note to Instructor:
Discussion Question
How can marketers use these networks?
This slide should provide a lively discussion for students because they all are users of social networks. Ask students for examples they have seen or experienced. Then be sure to ask if they think the marketing efforts were effective for the marketer and why? P&G for example set up
Ch 5 -10
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11. Characteristics Affecting Consumer Behavior
Social Factors
Family is the most important consumer-buying organization in society.
Social roles and status are the groups, family, clubs, and organizations that a person belongs to that can define role and social status.
Note to Instructor
Discussion Question
What brands do you purchase because it is what your parents used? Why do you think this occurs?
Ch 5 -11
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12. 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
Ch 5 -12
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13. Characteristics Affecting Consumer Behavior
Occupation affects the goods and services bought by consumers.
Economic situation includes trends in:
Personal Factors
Personal income
Savings
Interest rates
Ch 5 -13
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14. Characteristics Affecting Consumer Behavior
Personal Factors
Lifestyle is a person’s pattern of living as expressed in his or her psychographics.
Measures a consumer’s AIOs (activities, interests, opinions) to capture information about a person’s pattern of acting and interacting in the environment.
Note to Instructor
Lifestyle: BlackBerry has achieved initial success by attracting consumers with an interest in a cool lifestyle and social networking.
Discussion Question
What categories of products seem to be targeted to consumer’s lifestyles?
They will realize many products in addition to cars including food, cosmetics, shampoo also appeal to a consumer’s lifestyles.
Ch 5 -14
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15. 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 the consumer’s environment: Self-confidence, Sociability, Autonomy, Defensiveness, Adaptability, Aggressiveness.
Self-concept or self-image premise is that people’s possessions contribute to and reflect their identities—that is, ‘we are what we have’.
Ch 5 -15
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16. Characteristics Affecting Consumer Behavior
Brand Personalities
Sincerity:
Down-to-earth, honest, wholesome, and cheerful
Excitement:
Daring, spirited, imaginative, and up-to-date
Competence:
Reliable, intelligent, and successful
Sophistication:
Upper class and charming
Ruggedness:
Outdoorsy and tough
Note to Instructor
It is interesting to talk about brand personalities and ask students the personality of several brands:
A brand personality is the specific mix of human traits that may be attributed to a particular brand.
One researcher identified five brand personality traits
1. Sincerity (down-to-earth, honest, wholesome, and cheerful)
2. Excitement (daring, spirited, imaginative, and up-to-date)
3. Competence (reliable, intelligent, and successful)
4. Sophistication (upper class and charming)
5. Ruggedness (outdoorsy and tough)
Ch 5 -16
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17. Characteristics Affecting Consumer Behavior
Psychological Factors
Motivation
Perception
Learning
Beliefs and attitudes
Ch 5 -17
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18. 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, subconscious motivations.
Note to Instructor
An aging consumer who buys a sporty convertible might explain that he or she simply likes the feel of the wind in his or her thinning hair. At a deeper level, the person may be buying the car to feel young and independent again.
Ch 5 -18
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19. Characteristics Affecting Consumer Behavior
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20. 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
Note to Instructor
Selective perception: It’s impossible for people to pay attention to the thousands of ads they’re exposed to every day, so they screen most of them out.
Discussion Question
If you watched television last night, what ads do you remember seeing?
Probe to find out why they remember certain ads—was it that they broke through the clutter, that they saw them many times, or that they are in the market for that certain product?
Ch 5 -20
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21. 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.
Ch 5 -21
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22. 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
Cues
Responses
Reinforcement
Ch 5 -22
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23. 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
Ch 5 -23
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24. 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.
Ch 5 -24
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25. Types of Buying Decision Behavior
Complex buying behavior
Dissonance-reducing buying behavior
Habitual buying behavior
Variety-seeking buying behavior
Ch 5 -25
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26. Types of Buying Decision Behavior
Ch 5 -26
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27. The Buyer Decision Process
Need Recognition
Occurs when the buyer recognizes a problem or need triggered by:
Internal stimuli
External stimuli
Ch 5 -27
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28. The Buyer Decision Process
Information 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
Ch 5 -28
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29. The Buyer Decision Process
Evaluation of Alternatives
How the consumer processes information to arrive at brand choices.
Depends on the individual consumer and the specific buying situation.
Note to Instructor
This Web link brings you to PriceGrabber—an online comparison shopping site. What is interesting on this site is on the left hand side, you can search by features. These features help a consumer know how to evaluate a product. For instance, this example is laptop computers and one can search by processing speed, processor type, screen size, etc.
Ch 5 -29
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30. The Buyer Decision Process
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.
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

31. The Buyer Decision Process
Post-Purchase Decision
Cognitive dissonance is the discomfort caused by a post-purchase conflict.
Customer satisfaction is a key to building profitable relationships with consumers—to keeping and growing consumers and reaping their customer lifetime value.
Ch 5 -31
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32. The Buyer Decision Process for New Products
New Product and Adoption Process
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.
Ch 5 -32
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33. The Buyer Decision Process for New Products
Stages in the Adoption Process
Awareness
Interest
Evaluation
Trial
Adoption
Ch 5 -33
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34. The Buyer Decision Process for New Products
Influence of Product Characteristics on Rate of Adoption
Relative advantage
Compatibility
Complexity
Divisibility
Communicability
Ch 5 -34
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