Consumer Markets and Consumer Buyer Behavior

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Chapter 5

• Consumer Markets and Consumer Buyer Behavior

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Schedule Before Midterm
4 Oct.8/9 Consumer Markets and Consumer Buyer Behavior Ch.5 Case 3
5 Oct.15/16 Business Markets and Business Buyer Behavior Ch.6 Case 4
6 Oct.22/23 Marketing Information System Ch.4 Case 5
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Learning Goals

1. Define the consumer market and construct a model
   of consumer buyer behavior
2. Name the four factors that influence buyer
   behavior
3. List and understand the types of buying decision
   behavior and stages in the process
4. Describe the adoption and diffusion process for
   new products

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Case StudyHarley Davidson

• Measuring Success
• Currently 22 of all U.S. bike sales
• Demand above supply
• Sales doubled in the past 5 years with earnings
  tripled

• Building Success
• Understanding the customers emotions and
  motivation
• Determining the factors of loyalty
• Translating this information to effective
  advertising

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Learning Goals

• Define the consumer market and construct a model
  of consumer buyer behavior
• Name the four factors that influence buyer
  behavior
• List and understand the types of buying decision
  behavior and stages in the process
• Describe the adoption and diffusion process for
  new products

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Definitions

• Consumer buyer behavior refers to the buying
  behavior of final consumers individuals and
  households who buy goods and services for
  personal consumption
• All of these final consumers combine to make up
  the consumer market

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Learning Goals

1. Define the consumer market and construct a model
   of consumer buyer behavior
2. Name the four factors that influence buyer
   behavior
3. List and understand the types of buying decision
   behavior and stages in the process
4. Describe the adoption and diffusion process for
   new products

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Model of Buyer Behavior
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Characteristics Affecting Consumer Behavior

• Culture
• Forms a persons wants and behavior
• Subculture
• Groups with shared value systems
• Social Class
• Societys divisions who share values, interests
  and behaviors

Key Factors

• Cultural
• Social
• Personal
• Psychological

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Characteristics Affecting Consumer Behavior

• Groups
• Membership
• Reference
• Aspirational
• Opinion leaders
• Buzz marketing
• Family
• Many influencers
• Roles and status

Key Factors

• Cultural
• Social
• Personal
• Psychological

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This advertiser knows teens are strongly
influenced by groups when purchasing fashion items
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Characteristics Affecting Consumer Behavior

• Age and life cycle
• Occupation
• Economic situation
• Lifestyle
• Activities, interests and opinions
• Lifestyle segmentation
• Personality and self-concept

Key Factors

• Cultural
• Social
• Personal
• Psychological

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Personal Factors

• Family Life Cycle stages throughout which
  families pass as they mature over time
• Stages in family life cycle
• 1.bachelor stage
• 2.newly married couples, no children
• 3.full nest 1 youngest child under 6
• 4.full nest 2 youngest child 6 or over
• 5. full nest 3 older married couples with
  dependent children
• 6.empty nest 1 older married couples no children
  with them
• 7. empty nest 1 older married couples no
  children at homeretired
• 8.solitary survivor, working
• 9.solitary survivor, retired

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Personal Factors

• Personality g a persons unique characteristics
  that lead to relatively consistent and lasting
  responses to his environment
• Self-concept g the self image or general picture
  that people have of themselves

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Personal Factors

• Lifestyle a persons pattern of living as
  expressed in his activities, interests and
  opinions
• Psychographics g technique of measuring
  lifestyles and developing lifestyle
  classifications
• Major dimensions measured are
• Activities (work, hobbies, social events,
  entertainment, shopping, sports,vacation)
• Interests (family, home, job, recreation,
  fashion, food, media, achievements)
• Opinions (themselves, social issues, politics,
  business, economics, products, future)

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Values and Lifestyles (VALS)
Actualizers
High Resources

High Innovation
Achievers
Fulfilleds
Experiencers
Makers
Strivers
Believers
Strugglers
Low Resources
Low Innovation
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Brand Personality Dimensions

• Sincerity
• Ruggedness

• Excitement
• Competence

• Sophistication

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Characteristics Affecting Consumer Behavior

• Motivation
• Perception
• Learning
• Beliefs and attitudes

Key Factors

• Cultural
• Social
• Personal
• Psychological

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Psychological FactorsMotivation

• A motive is a need that is sufficiently pressing
  to direct the person to seek satisfaction
• Motivation research is based on Freud. Looks for
  hidden and subconscious motivation
• Maslow ordered needs based on how pressing they
  are to the consumer

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Maslows Hierarchy of Needs
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This ad demonstrates a product meeting
physiological and social needs
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Discussion

• What consumer products might fulfill multiple
  levels of the Hierarchy of Needs?

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Psychological Factors Perception

• Perception is the process by which people select,
  organize, and interpret information.
• Perception Includes
• Selective attention
• Consumers screen out information
• Selective distortion
• People interpret to support beliefs
• Selective retention
• People retain points to support attitudes

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Discussion QuestionPerception

1. How many ads were you exposed to today?
2. Which ones do you remember? Why?

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Psychological Factors Learning

• Learning describes changes in an individuals
  behavior arising from experience
• Learning occurs through
• Drives
• Internal stimulus that calls for action
• Stimuli
• Objects that move drive to motive
• Cues
• Minor stimuli that affect response
• Reinforcement
• Feedback on action

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Psychological Factors Beliefs and Attitudes

• Belief
• a descriptive thought about a brand or service
• may be based on real knowledge, opinion, or faith
• Attitude
• describes a persons evaluations, feelings and
  tendencies toward an object or idea
• They are difficult to change

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Learning Goals

1. Define the consumer market and construct a model
   of consumer buyer behavior
2. Name the four factors that influence buyer
   behavior
3. List and understand the types of buying decision
   behavior and stages in the process
4. Describe the adoption and diffusion process for
   new products

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Types of Buying Decision Behavior
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The Buying Roles

• 5 roles people might play in a buying decision
• Initiator g who first gives the idea of buying
  the product or service
• Influencer gwhose view or advice influences the
  decision
• Decider gwho decide on any component of buying
  decision
• Buyer gwho makes the actual purchase
• User gwho uses the product or sevice purchased

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The Buyer Decision Process
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The Buyer Decision Process

• Needs can be triggered by
• Internal stimuli
• Normal needs become strong enough to drive
  behavior
• External stimuli
• Advertisements
• Friends of friends

Process Stages

• Need recognition
• Information search
• Evaluation of alternatives
• Purchase decision
• Postpurchase behavior

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The Buyer Decision Process

• Consumers exhibit heightened attention or
  actively search for information
• Sources of information
• Personal
• Commercial
• Public
• Experiential
• Word-of-mouth

Process Stages

• Need recognition
• Information search
• Evaluation of alternatives
• Purchase decision
• Postpurchase behavior

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Information Search
Personal Sources
Commercial Sources

Public Sources

• Family, friends, neighbors
• Most effective source of
• information

• Advertising, salespeople
• Receives most information
• from these sources

Experiential Sources

• Mass Media
• Consumer-rating groups

• Handling the product
• Examining the product
• Using the product

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The Buyer Decision Process

• Evaluation procedure depends on the consumer and
  the buying situation.
• Most buyers evaluate multiple attributes, each of
  which is weighted differently.
• At the end of the evaluation stage, purchase
  intentions are formed.

Process Stages

• Need recognition
• Information search
• Evaluation of alternatives
• Purchase decision
• Postpurchase behavior

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Evaluation of Alternatives
Consumer May Use Careful Calculations Logical
Thinking
Consumers May Buy on Impulse and Rely on
Intuition
Consumers May Make Buying Decisions on Their Own.
Consumers May Make Buying Decisions Only After
Consulting Others.
Marketers Must Study Buyers to Find Out How They
Evaluate Brand Alternatives
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Decision Making Sets
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The Buyer Decision Process
Process Stages

• Two factors intercede between purchase intentions
  and the actual decision
• Attitudes of others
• Unexpected situational factors

• Need recognition
• Information search
• Evaluation of alternatives
• Purchase decision
• Postpurchase behavior

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Buyer Decision Process for New Products

• New Products
• Good, service or idea that is perceived by
  customers as new.
• Stages in the Adoption Process
• Marketers should help consumers move through
  these stages.

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Stages in the Adoption Process
Awareness Consumer is aware of product, but
lacks information.
Interest Consumer seeks Information about new
product.
Evaluation Consumer considers trying new product.
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Buyer Decision Process for New Products

• Individual Differences in Innovativeness
• Consumers can be classified into five adopter
  categories, each of which behaves differently
  toward new products

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Adopter Categories
Early Majority
Late Majority
Early Adopters
Innovators
Percentage of Adopters
Laggards
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13.5
2.5
Time of Adoption
Late
Early
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Buyer Decision Process for New Products

• Product Characteristics influencing the adoption
  rate
• Relative Advantage g Is the innovation superior
  to existing products?
• Compatibility g Does the innovation fit the
  values and experience of the target market?
• Complexity g Is the innovation difficult to
  understand or use?
• Divisibility g Can the innovation be used on a
  trial basis?
• Communicability g Can results be easily observed
  or described to others?

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Buyer Decision Process for New Products

• International Consumer Behavior
• Values, attitudes and behaviors differ greatly in
  other countries.
• Physical differences exist which require changes
  in the marketing mix.
• Customs vary from country to country.
• Marketers must decide the degree to which they
  will adapt their marketing efforts.

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Discussion Question

• How is a site like Consumer Reports used in the
  decision- making process?

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Discussion Question

• Why might the adoption process be slow for a home
  robot?

Source Business Week
Source Business Week
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The Buyer Decision Process

• Satisfaction is important
• Delighted consumers engage in positive
  word-of-mouth.
• Unhappy customers tell on average 11 other
  people.
• Cognitive dissonance is common

Process Stages

• Need recognition
• Information search
• Evaluation of alternatives
• Purchase decision
• Postpurchase behavior

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Learning Goals

1. Define the consumer market and construct a model
   of consumer buyer behavior
2. Name the four factors that influence buyer
   behavior
3. List and understand the types of buying decision
   behavior and stages in the process
4. Describe the adoption and diffusion process for
   new products

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Ramazan Bayraminiz Kutlu Mutlu olsun!!!

• For Next Week
• Read Chapter 6
• Be prepared for case 4 Kodak discussion