1. Copyright © 2006 by South-Western, a division of Thomson Learning, Inc. All rights reserved. Chapter 5 Consumer Behavior

2. Copyright © 2006 by South-Western, a division of Thomson Learning, Inc. All rights reserved. 5-2 Chapter Objectives 1.Distinguish between customer behavior and consumer behavior. 2.Explain how marketers classify behavioral influences on consumer decisions. 3.Describe cultural, group, and family influences on consumer behavior. 4.Explain each of the personal determinants of consumer behavior; needs and motives, perceptions, attitudes, and self-concept theory. 5.Distinguish between high-involvement and low- involvement purchase decisions. 6.Outline the steps in the consumer decision process. 7.Differentiate among routinized response behavior, limited problem solving, and extended problem solving by consumers.

3. Copyright © 2006 by South-Western, a division of Thomson Learning, Inc. All rights reserved. 5-3 Customer vs. Consumer Behavior Customer behavior: Customer behavior: a broad term that covers both individual consumers who buy goods and services for their own use and organizational buyers who purchase business products Consumer behavior: Consumer behavior: the process through which the ultimate buyer makes purchase decisions

4. Copyright © 2006 by South-Western, a division of Thomson Learning, Inc. All rights reserved. 5-4 Cultural Influences Cultural Influences Culture: values, beliefs, preferences, and tastes handed down from one generation to the next It is important to recognize the concept of ethnocentrism, or the tendency to view your own culture as the norm, as it relates to consumer behavior. Interpersonal Determinants of Consumer Behavior

5. Copyright © 2006 by South-Western, a division of Thomson Learning, Inc. All rights reserved. 5-5 Core Values in the U.S. Culture Core Values in the U.S. Culture While some cultural values change over time, basic core values do not Examples of American core values include:  Importance of family and home life  Education  Youthfulness  Individualism

6. Copyright © 2006 by South-Western, a division of Thomson Learning, Inc. All rights reserved. 5-6 International Perspective on Cultural Influences International Perspective on Cultural Influences Cultural differences are particularly important for international marketers Successful strategies in one country often cannot extend to other international markets because of cultural variations

7. Copyright © 2006 by South-Western, a division of Thomson Learning, Inc. All rights reserved. 5-7 Subcultures: Subcultures: subgroup of culture with its own, distinct modes of behavior Cultures are not homogeneous entities with universal values. Subcultures can differ by:  Ethnicity or Nationality  Age or Gender  Religion  Social class or Profession

8. Copyright © 2006 by South-Western, a division of Thomson Learning, Inc. All rights reserved. 5-8 Hispanic-American Consumers Hispanic-American Consumers The 40 million Hispanics in the U.S., coming from a wide range of countries, are not homogenous There are important differences in acculturation The Hispanic market is large and fast-growing Hispanics tend to be younger than the general U.S. population Hispanics are geographically concentrated

9. Copyright © 2006 by South-Western, a division of Thomson Learning, Inc. All rights reserved. 5-9 African-American Consumers African-American Consumers African-American buying power is rising rapidly compared to U.S. consumers in general Family structures may differ for African-American consumers, creating differences in preferences for clothing, music, cars, and many other products

10. Copyright © 2006 by South-Western, a division of Thomson Learning, Inc. All rights reserved. 5-10 Asian-American Consumers Asian-American Consumers Marketing to Asian-Americans presents many of the same challenges as reaching Hispanics Asian-Americans are spread among culturally diverse groups, including Chinese, Japanese, Indians, Koreans, Filipinos, and Vietnamese-- many retaining their own languages

11. Copyright © 2006 by South-Western, a division of Thomson Learning, Inc. All rights reserved. 5-11 Social Influences Social Influences Group membership influences an individual’s purchase decisions and behavior in both overt and subtle ways. Norms: are the values, attitudes, and behaviors that a group deems appropriate for its members Status: is the relative position of any individual member in a group Roles define behavior that members of a group expect of individuals who hold specific positions within the group

12. Copyright © 2006 by South-Western, a division of Thomson Learning, Inc. All rights reserved. 5-12 The Asch Phenomenon: The Asch Phenomenon: the effect of a reference group on individual decision- making Reference groups: Reference groups: groups whose value structures and standards influence a person’s behavior Requires two conditions:  The purchased product must be one that others can see and identify  The purchased item must be conspicuous; it must stand out as something unusual, a brand or product that not everyone owns

13. Copyright © 2006 by South-Western, a division of Thomson Learning, Inc. All rights reserved. 5-13 Social classes Social classes Groups whose rankings are determined by occupation, income, education, family background, and residence location Opinion leaders Opinion leaders Trendsetters who purchase new products before others in a group and then influence others in their purchases

14. Copyright © 2006 by South-Western, a division of Thomson Learning, Inc. All rights reserved. 5-14 Family Influences Family Influences Autonomic Husband-dominant Wife-dominant Syncratic Children and Teenagers in Family Purchases Children and Teenagers in Family Purchases Growing numbers are assuming responsibility for family shopping Also influence what parents buy

15. Copyright © 2006 by South-Western, a division of Thomson Learning, Inc. All rights reserved. 5-15 Personal Determinants of Consumer Behavior Needs & Motives Perceptions Attitudes Learning Self Concept

16. Copyright © 2006 by South-Western, a division of Thomson Learning, Inc. All rights reserved. 5-16 Needs and Motives Needs and Motives Need: an imbalance between a consumer’s actual and desired states Motives: inner states that direct a person toward the goal of satisfying a felt need

17. Copyright © 2006 by South-Western, a division of Thomson Learning, Inc. All rights reserved. 5-17 Maslow’s Hierarchy of Needs Maslow’s Hierarchy of Needs Self-Actualization Esteem Needs Social Needs Safety Needs Physiological Needs

18. Copyright © 2006 by South-Western, a division of Thomson Learning, Inc. All rights reserved. 5-18 Perceptions: Perceptions: the meaning that a person attributes to incoming stimuli gathered through the five senses – sight, hearing, touch, taste, and smell. Perceptual screens: Perceptual screens: the filtering processes through which all inputs must pass Subliminal Perception: Subliminal Perception: subconscious receipt of information

19. Copyright © 2006 by South-Western, a division of Thomson Learning, Inc. All rights reserved. 5-19 Attitudes Attitudes A person’s enduring favorable or unfavorable evaluations, emotional feelings, or action tendencies toward some object or idea Attitude components:  Cognitive  Affective  Behavioral

20. Copyright © 2006 by South-Western, a division of Thomson Learning, Inc. All rights reserved. 5-20 Changing Consumer Attitudes Changing Consumer Attitudes Attempt to produce consumer attitudes that will motivate the purchase of a particular product Evaluate existing consumer attitudes and then make the product characteristics appeal to them Modifying the Components of Attitude Modifying the Components of Attitude Attitudes change in response to inconsistencies among the three components Marketers can work to modify attitudes by providing evidence of product benefits and by correcting misconceptions

21. Copyright © 2006 by South-Western, a division of Thomson Learning, Inc. All rights reserved. 5-21 Learning Learning An immediate or expected change in behavior as a result of experience. Process includes the components of:  Drive, Cue, Response, Reinforcement Applying Learning Theory to Marketing Decisions  Shaping

22. Copyright © 2006 by South-Western, a division of Thomson Learning, Inc. All rights reserved. 5-22 Self-Concept Self-Concept A person’s multifaceted picture of himself or herself, composed of the:  Real self  Self-image  Looking-glass self  Ideal self

23. Copyright © 2006 by South-Western, a division of Thomson Learning, Inc. All rights reserved. 5-23 The Consumer Decision Process Consumers complete a step-by-step process when making purchase decisions High-involvement purchase decisions are those with high levels of potential social or economic consequences Low-involvement decisions are routine purchases that pose little risk to the consumer Search Alternative Evaluation Purchase Decision Purchase Act Post- purchase Evaluation Problem Opportunity Recognition

24. Copyright © 2006 by South-Western, a division of Thomson Learning, Inc. All rights reserved. 5-24 Problem or Opportunity Recognition Problem or Opportunity Recognition Consumer becomes aware of a significant discrepancy between the existing situation and the desired situation Motivates the individual to achieve the desired state of affairs

25. Copyright © 2006 by South-Western, a division of Thomson Learning, Inc. All rights reserved. 5-25 Search Search Consumer gathers information related to their attainment of the desired state of affairs Identifies alternative means of problem solution May cover internal or external sources of information Brands that a consumer actually considers buying before making a purchase decision are known as the evoked set

26. Copyright © 2006 by South-Western, a division of Thomson Learning, Inc. All rights reserved. 5-26 Evaluation of Alternatives Evaluation of Alternatives Consumer evaluates the evoked set Difficult to completely separate the second and third steps, since some evaluation takes place as the search progresses Outcome of the evaluation stage is the choice of a brand or product (or possibly a decision to renew the search) Evaluative criteria: features that a consumer considers in choosing among alternatives

27. Copyright © 2006 by South-Western, a division of Thomson Learning, Inc. All rights reserved. 5-27 Purchase Decision and Purchase Act Purchase Decision and Purchase Act Consumer narrows the alternatives down to one The purchase location is decided Postpurchase Evaluation Postpurchase Evaluation After the purchase, consumers are either satisfied or experience post- purchase anxiety Cognitive dissonance

28. Copyright © 2006 by South-Western, a division of Thomson Learning, Inc. All rights reserved. 5-28 Classifying Consumer Problem-Solving Processes Classifying Consumer Problem-Solving Processes Three categories of problem-solving behavior  Routinized Response Behavior  Limited Problem Solving  Extended Problem Solving