Presentation on theme: "Consumer Markets and Consumer Buyer Behavior"— Presentation transcript:
1 Consumer Markets and Consumer Buyer Behavior Chapter FiveConsumer Markets and Consumer Buyer Behavior
2 Consumer Markets and Consumer Buyer Behavior Topic OutlineModel of Consumer BehaviorCharacteristics Affecting Consumer BehaviorTypes of Buying Decision BehaviorThe Buyer Decision ProcessThe Buyer Decision Process for New Products
3 Model of consumer behavior Consumers make many buying decisions everyday and buying decision is the focal point of the marketer’s effort.Marketers can study actual consumer purchases to find out what they buy, where and how much, but learning the why’s of the consumer buying behavior is not easy- the answer is locked deep within the consumer’s mind
4 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 consumptionConsumer market refers to all of the personal consumption of final consumersNote to InstructorDiscussion QuestionWhat 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.
5 Model of Consumer Behavior Note to InstructorIt is interesting to talk about the buyer’s black box and one of the largest challenges in marketing is to understand what happens in this black box. Students will enjoy this video by Derren Brown. It is unclear how he obtains his results and how scientific this is, but it will certainly have students realize the mystery of the consumer’s brain.
6 Buyer characteristics and the buyer decision process are two parts of _______. buyer’s black boxbuyer’s white boxbuyer’s red boxbuyer’s shopping box
7 Buyer characteristics and the buyer decision process are two parts of _______. buyer’s black boxbuyer’s white boxbuyer’s red boxbuyer’s shopping box
9 Consumer purchases are influenced by cultural, _______, personal, and psychological characteristics. costsocialhealthprofit
10 Consumer purchases are influenced by cultural, _______, personal, and psychological characteristics. costsocialhealthprofit
11 Characteristics Affecting Consumer Behavior Culture is the learned values, perceptions, wants, and behavior from family and other important institutionsEvery group or society has a culture and cultural influences on buying behavior may vary greatly from one country to anotherMarketers are always trying to spot cultural shifts in order to discover new products that might be wanted
12 Characteristics Affecting Consumer Behavior Subculture are groups of people within a culture with shared value systems based on common life experiencesand situationsHispanicAfrican AmericanAsianMature consumersNote to InstructorDiscussion QuestionWhat subculture do you belong to? How does this influence you as a consumer?
13 Characteristics Affecting Consumer Behavior Hispanic consumers: one third of the US populationHispanic consumers tend to buy more branded, higher quality productsAfrican-American consumers: they are motivated by quality and selection. Brands are important
14 Characteristics Affecting Consumer Behavior Asian American: they are the second fastest growing population sub segment after the Hispanics.More than 90% of the Asian American Go online regularly and are most comfortable with internet technology such as online banking
15 Characteristics Affecting Consumer Behavior Mature consumers: very attractive market. The entire U.S baby boom generation, the largest and the wealthiest demographic cohort in the country.Mature consumers are not stuck in their ways
16 Four examples of subculture groups include Hispanic, African American, Asian American, and ________. middle-classmature consumersRVersecho boomers
17 Four examples of subculture groups include Hispanic, African American, Asian American, and ________. middle-classmature consumersRVersecho boomers
18 Groups of people with shared value systems based on common life experiences are called ________. cohortsgenerationssubculturesaffiliate groups
19 Groups of people with shared value systems based on common life experiences are called ________. cohortsgenerationssubculturesaffiliate groups
20 The fastest-growing and most affluent subculture in the United States is the _____ population. HispanicAfrican AmericanAsian Americanmature
21 The fastest-growing and most affluent subculture in the United States is the _____ population. HispanicAfrican AmericanAsian Americanmature
22 Characteristics Affecting Consumer Behavior Social classes are society’s relatively permanent and ordered divisions whose members share similar values, interests, and behaviorsMeasured by a combination of occupation, income, education, wealth, and other variables
23 Characteristics Affecting Consumer Behavior In some social systems, members of different classes are reared for certain roles and cant change their social positions. In other country, however, the lines between social classes are not fixed and rigid, people can move to a higher social class or drop into a lower one.
24 Characteristics Affecting Consumer Behavior Marketers are interested in social class because within a given social class tend to exhibit similar buying behavior. Social classes show distinct product and brand preferences in areas such as clothing , home furnishings, and automobiles.
25 Characteristics Affecting Consumer Behavior Note to InstructorThe Web link brings you to Rhode Island Housing. This is an example of an organization that targets the lower income groups with housing solutions. It will be interesting to ask the student the challenges in targeting this group for this company. They might realize that high illiteracy rates, non-English speakers, and lower education levels might make it harder for them to be reached and to understand the messages.
26 Relatively permanent and ordered divisions in a society whose members share similar values, interests, and behaviors is referred to as ________.subculturefamiliessocial classreference groups
27 Relatively permanent and ordered divisions in a society whose members share similar values, interests, and behaviors is referred to as ________.subculturefamiliessocial classreference groups
28 Which of the following is not one of the major American social classes? Upper classWorking classLower-upper classLower-working class
29 Which of the following is not one of the major American social classes? Upper classWorking classLower-upper classLower-working class
30 Characteristics Affecting Consumer Behavior Groups and Social NetworksMembership GroupsGroups with direct influence and to which a person belongsAspirational GroupsGroups an individual wishes to belong toReference GroupsGroups that form a comparison or reference in forming attitudes or behaviorNote to InstructorDiscussion QuestionWhat groups are you a member of and what are your aspirational groups. How does this influence you as a consumers?
31 Characteristics Affecting Consumer Behavior Groups and Social NetworksWord-of-mouth influence and buzz marketingOpinion leaders are people within a reference group who exert social influence on othersAlso called influentials or leading adoptersMarketers identify them to use as brand ambassadorsNote to InstructorIt is a great idea to click through to the Tremor 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?
32 A person within a reference group who, because of special skills, knowledge, or other characteristics, exerts social influence on others is called a(n) ________.opinion leadermature consumermarketerupper class citizen
33 A person within a reference group who, because of special skills, knowledge, or other characteristics, exerts social influence on others is called a(n) ________.opinion leadermature consumermarketerupper class citizen
34 Characteristics Affecting Consumer Behavior Groups and Social NetworksOnline Social Networks are online communities where people socialize or exchange information and opinionsInclude blogs, social networking sites (facebook), virtual worlds (second life)Note to Instructor:Discussion QuestionHow 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? The text gives many examples including Victoria’s Secret on Facebook and Coca Cola in Second Life.
35 Characteristics Affecting Consumer Behavior Social Factors ( family )Family is the most important consumer-buying organization in societyMarketers are interested in the roles and influence of the husband, wife and children on the purchase of different products and servicesThe wife traditionally has been the main purchasing agent for the family.
36 Characteristics Affecting Consumer Behavior Social Factors ( family )Children may also have a strong influence on family buying decisionsStudies found that kids influence family decisions about where they take vacations , what cars or cell phones they buy. As a result , marketers of cars , full service restaurants , cell phones are now placing ads on the children oriented TV networks
37 Characteristics Affecting Consumer Behavior Social Factors (roles and status)Social roles and status are the groups, family, clubs, and organizations that a person belongs to that can define role and social statusA role consists of the activities that people expected to perform according to the persons around themNote to InstructorDiscussion QuestionWhat brands do you purchase because it is what their parents used? Why do you think this occurs?
38 Characteristics Affecting Consumer Behavior Social Factors (roles and status)Each role carries a status reflecting the general esteem given to it by society.People usually choose products appropriate to their roles and status. Consider the roles a working mother plays
39 Characteristics Affecting Consumer Behavior Personal FactorsAge and life-cycle stagePeople change the goods and services they buy over their lifetimes. Tastes in food, clothes, furniture and recreation are 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”
40 Characteristics Affecting Consumer Behavior Personal FactorsTraditional family life cycle stages include young singles and married couples with children.The nontraditional stages such as unmarried couples, singles marrying later in life, single parents , extended parents ( those with young adult children returning home ) and others
41 Characteristics Affecting Consumer Behavior Personal FactorsRBC Royal Bank stagesYouth: younger than 18Getting started: 18–35 who are going through first experiences, first credit card, first car , first childBuilders: 35–50 in their peak earning years, as they build careers and family, they tend to borrow more than they invest
42 Characteristics Affecting Consumer Behavior Personal FactorsAccumulators: 50–60Worry about saving for retirement and invested wisely.Preservers: over 60Want to maximize their retirement income to maintain a desired lifestyle.
43 Characteristics Affecting Consumer Behavior Personal FactorsOccupation affects the goods and services bought by consumersBlue workers tend to buy more rugged work clothes, whereas executives buy more business suits.A company can specialize in making products needed by a given occupational group.
44 Characteristics Affecting Consumer Behavior Personal FactorsEconomic situation includes trends in:If economic indicators point to a recession, marketers can take steps to redesign , and reprice their products closely.Personal incomeSavingsInterest rates
45 Characteristics Affecting Consumer Behavior Personal FactorsLifestyle is a person’s pattern of living as expressed in his or her psychographicsMeasures a consumer’s AIOs (activities, interests, opinions) to capture information about a person’s pattern of acting and interacting in the environmentNote to InstructorDiscussion QuestionWhat 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.
46 Characteristics Affecting Consumer Behavior Personal FactorsPersonality and self-conceptPersonality refers to the unique psychological characteristics that lead to consistent and lasting responses to the consumer’s environmentPersonality is described in terms of traits .Note to InstructorThis PC ad from Fall of 2008 shows how PC’s are a a fit for many personalities even though Mac has run ads which stereotype the user.
47 Characteristics Affecting Consumer Behavior Personal FactorsDominanceAutonomyDefensivenessAdaptabilityAggressivenessNote to InstructorIt 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 traits1. 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)
48 Characteristics Affecting Consumer Behavior A brand personality is the specific mix of the human traits that may be attributed to a particular brand. One researcher identified five brand personality traits:Sincerity ( honest, wholesome, and cheerful)Excitement ( imaginative and up-to date)
49 Characteristics Affecting Consumer Behavior 3. Competence ( reliable , intelligent and successful ) 4. Sophistication ( upper class and charming) 5. Ruggedness ( tough and outdoorsy)
50 A person’s _____ is his/her unique set of psychological characteristics that are relatively consistent and lasting.self-esteemself-conceptlifestylepersonality
51 A person’s _____ is his/her unique set of psychological characteristics that are relatively consistent and lasting.self-esteemself-conceptlifestylepersonality
52 Which of the following is not one of the five brand personality traits? RuggednessSophisticationSelf-conceptSincerity
53 Which of the following is not one of the five brand personality traits? RuggednessSophisticationSelf-conceptSincerity
54 Characteristics Affecting Consumer Behavior Psychological FactorsMotivationPerceptionLearningBeliefs and attitudes
55 Characteristics Affecting Consumer Behavior Psychological FactorsMotivationA person has may needs at any given time. Some are biological, arising from the states of tension such as hunger, thirst or discomfort. Others are psychological arising from the need for recognition , esteem , or belonging .A need becomes a motive when it’s aroused to a sufficient level of intensity
56 Characteristics Affecting Consumer Behavior Psychological FactorsMotivationA motive is a need that is sufficiently pressing to direct the person to seek satisfactionMotivation research refers to qualitative research designed to probe consumers’ hidden, subconscious motivations
57 Characteristics Affecting Consumer Behavior Psychologists have developed theories of human motivation, two of the most popular- the theories of psychologists Frued and Maslow.Frued’s theory suggests that a person’s buying decisions are affected by subconscious motives that even the buyer mayn’t fully understand.
58 Characteristics Affecting Consumer Behavior Maslow’sHierarchy of Needs
59 Maslow’s hierarchy of needs are psychological, safety, ________, esteem, and self-actualization. socialeconomiclifestyleeducation
60 Maslow’s hierarchy of needs are psychological, safety, ________, esteem, and self-actualization. socialeconomiclifestyleeducation
61 Characteristics Affecting Consumer Behavior Psychological FactorsPerception is the process by which people select, organize, and interpret information to form a meaningful picture of the world from three perceptual processesSelective attentionSelective distortionSelective retentionNote to InstructorDiscussion QuestionIf 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?
62 The process by which people select, organize, and interpret information to form a meaningful picture of the world is ________.sensationlearningperceptionmotivation
63 The process by which people select, organize, and interpret information to form a meaningful picture of the world is ________.sensationlearningperceptionmotivation
64 Characteristics Affecting Consumer Behavior Psychological FactorsSelective attention is the tendency for people to screen out most of the information to which they are exposed, marketers must work hard to attract the consumer’s attention 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
65 Characteristics Affecting Consumer Behavior Psychological FactorsLearning is the change in an individual’s behavior arising from experience and occurs through interplay of:DrivesStimuliCuesResponsesReinforcement
66 Characteristics Affecting Consumer Behavior Psychological FactorsA drive : a strong internal stimulus that calls for action.A drive becomes a motive when its directed towards a particular stimulus object.Cues are minor stimuli that determine when, where and how the person respondsThe consumer’s response to his or her interest in buying the product
67 Characteristics Affecting Consumer Behavior Psychological FactorsBeliefs and AttitudesBelief is a descriptive thought that a person has about something based on:KnowledgeOpinionFaith
68 Characteristics Affecting Consumer Behavior Marketers are interested in the beliefs that people formulate about specific products and services, because these beliefs make up product and brand images that affect buying behavior.If some of the beliefs are wrong and prevent purchase , the marketer will want to launch a campaign to correct them.
69 Characteristics Affecting Consumer Behavior Psychological FactorsAttitudes describe a person’s relatively consistent evaluations, feelings, and tendencies toward an object or idea
70 Characteristics Affecting Consumer Behavior Psychological FactorsAttitudes put people into a frame of mind of liking or disliking things, or moving toward or away from themAttitudes are difficult to change, a company should usually try to fit its products into existing attitudes rather than an attempt to change the attitudes.
72 Complex buying behavior When consumers are highly involved in a purchase and perceive significant differences among the brands. Consumers maybe highly involved when the product is expensive, risky and purchased infrequentlyMarketers need to help buyers learn about product-class attributes& their relative importance. They need to differentiate their brand features, by describing them using print media with long copy
73 Dissonance-reducing buying behavior Occurs when consumers are highly involved with an expensive , risky purchase but see little differences among brandsConsumers might experience post purchase dissonance when they notice certain disadvantages of the purchased brand or hear favorable things about brands not purchased
74 Habitual buying behavior Occurs under conditions of low consumer involvement and little significant brand differenceConsumers appear to have low involvement with most low cost, frequently purchased productsAd repetition creates brand familiarity rather than brand conviction “ consumers don’t form strong attitudes toward a brand, they select the brand because its familiar
75 Types of Buying Decision Behavior Four Types of Buying Behavior
76 Variety-seeking buying behavior In situations characterized by low consumer involvement but significant perceived brand differences. In such cases consumers often do a lot of brand switchingBrand switching occurs for the sake of variety rather than because of dissatisfaction .
77 A consumer purchasing fine furniture (which is expensive and for which a brand’s name matters) would probably result in ________ buying behavior.dissonance-reducingvariety-seekingcomplexhabitual
78 A consumer purchasing fine furniture (which is expensive and for which a brand’s name matters) would probably result in ________ buying behavior.dissonance-reducingvariety-seekingcomplexhabitual
79 ________ buying behavior is characterized by low consumer involvement but significant perceived brand differences.Dissonance-reducingVariety-seekingComplexHabitual
80 ________ buying behavior is characterized by low consumer involvement but significant perceived brand differences.Dissonance-reducingVariety-seekingComplexHabitual
81 The Buyer Decision Process Buyer Decision Making Process
82 The Buyer Decision Process Need RecognitionOccurs when the buyer recognizes a problem or need triggered by:Internal stimuliExternal stimuli
83 The Buyer Decision Process Information SearchSources of InformationPersonal sources—family and friendsCommercial sources—advertising, InternetPublic sources—mass media, consumer organizationsExperiential sources—handling, examining, using the product
84 The Buyer Decision Process Evaluation of AlternativesHow the consumer processes information to arrive at brand choicesNote to InstructorThis 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.
85 The Buyer Decision Process Purchase DecisionThe act by the consumer to buy the most preferred brandThe purchase decision can be affected by:Attitudes of othersUnexpected situational factors
86 The Buyer Decision Process Post-Purchase DecisionThe satisfaction or dissatisfaction that the consumer feels about the purchaseRelationship between:Consumer’s expectationsProduct’s perceived performanceThe larger the gap between expectation and performance, the greater the consumer’s dissatisfactionCognitive dissonance is the discomfort caused by a post-purchase conflict
87 The Buyer Decision Process Post-Purchase DecisionCustomer satisfaction is a key to building profitable relationships with consumers—to keeping and growing consumers and reaping their customer lifetime value
88 The Buyer Decision Process for New Products Adoption process is the mental process an individual goes through from first learning about an innovation to final regular use.Stages in the process include:AwarenessInterestEvaluationTrialAdoption
89 What are the two largest statistical populations in the adoption process? Innovators and early majorityEarly adopters and early majorityEarly majority and late majorityInnovators and laggards
90 What are the two largest statistical populations in the adoption process? Innovators and early majorityEarly adopters and early majorityEarly majority and late majorityInnovators and laggards
91 The Buyer Decision Process for New Products Influence of Product Characteristicson Rate of AdoptionRelative advantageCompatibilityComplexityDivisibilityCommunicability