Consumer Behavior

[email protected]@gmail.com 11

Prof. T.K.Sabarwal



Indian Consumer changes Middle class segment bulging Greater global exposure Larger disposable income Greater appetite & demand for global products Differentiated product & service requirements


FMCG space dynamics Explosion of products Explosion of markets (Kirana & Organized Retail) Rush of new players Global players bringing process and intelligence maturity Increasing competition Supply chain bottlenecks


Marketing can not be standardized, because of

•Cross – cultural styles.

•Fragmented markets.


11,000 New products were introduced by 77 companies. only 58% are present 5 yrs later.

•Only 8% of the new products offered by 112 leading companies reached the market.

•Of he above 83% failed to meet the marketing objectives.


Managers must analyze consumer motivations and behavior.


More successful a firm has been in the past, are more likely to fail. In future.

Why ????.


Because people tend to repeat behavior for which they have been successful and rewarded


Needs and wants = Needs and wants

Problem specific


Ultimate Goal of marketing

To make selling a redundant process

•By being focused on customer– understanding clearly –customer is the end and manufacturer as the means•By understanding the customer’s implicit and explicit needs •Creating a self generating pull for the market offering.


consumers

customer


Customers do not BUYS A PRODUCT !

What do they buy??


Manufacturer specific

Customer specific

Four P’s

Four C’s


MARKET


Is Consumer behavior

The activities that people engage in when selecting, purchasing and using products and services so as to satisfy needs and desires. Such activities involve mental ,emotional processes and physical action


1. Consumer behavior is motivated

2. Consumer behavior includes many activities.

3. Consumer behavior is a process

4. Consumer behavior varies in timing and complexity

5. Consumer behavior involves different roles

6. Consumer behavior is influenced by external factors

7. Consumer behavior differs for different people

These seven aspects hold key to understand consume behavior. Model’s

acronym is “MAPTRIP”


customercustomer

•To understand the customer –basic is to know that s/he is buying / using the products as a means to solve or address their own problem, reason and strategy and not yours and therefore unless marketer is customer specific in terms of marketing mix elements, success is usually evasive.

•Customer does not buy a brand s/he buys their perception, and choose a brand which offers the best solution to their problem

•Marketers only brief is to synergize the capabilities of the organization so as to address customer’s specific needs.


Customer defectionsCustomer defections

customer defections

60%20%

11%

1%

3%5%

indifference

product

price

death

relocation

new avenues


Seven sins of serviceSeven sins of service

1. Apathy—indifference,boredom (a matter of attitude)

2. Brush off--- getting rid of customer, not owning responsibility.

3. Coldness---chilly, hostility, curtness, unfriendliness.

4. Condensation---treating customer with a patronizing attitude.

5. Robotize---thank you, have a nice day –next

6. Rule book--- rules above the customer.

7. Run around----sorry you will have to …….

Calling mediocre service excellent doesn't make it excellent

Consumer Buying Consumer Buying BehaviorBehavior

Consumer Buying BehaviorConsumer Buying Behavior refers to refers to the the buying behavior of final buying behavior of final consumers (individuals & consumers (individuals & households) who buy goods and households) who buy goods and services for personal consumption.services for personal consumption.Study consumer behavior to answer:Study consumer behavior to answer:

““How do consumers respond to How do consumers respond to marketing efforts the company marketing efforts the company might use?” might use?”

Model of Consumer Model of Consumer BehaviorBehavior

Marketing andOther Stimuli

Marketing andOther Stimuli

Buyer’s Black BoxBuyer’s Black Box

Buyer’s ResponseBuyer’s Response

Product

Price

Place

Promotion

Economic

Technological

Political

Cultural

Characteristics Affecting Consumer Behavior

Buyer’s Decision Process

Product Choice

Brand Choice

Dealer Choice

Purchase Timing

Purchase Amount

Characteristics Affecting Characteristics Affecting Consumer BehaviorConsumer Behavior

BuyerBuyer

Psychological

Personal

Social

Culture

Factors Affecting Consumer Behavior:Factors Affecting Consumer Behavior:CultureCulture

Most basic cause of a person's wants Most basic cause of a person's wants and behavior.and behavior.

ValuesValuesPerceptionsPerceptions

Most basic cause of a person's wants Most basic cause of a person's wants and behavior.and behavior.

ValuesValuesPerceptionsPerceptions

Social Class

• People within a social class tend to exhibit similar buying behavior.

• Occupation

• Income

• Education

• Wealth

Social Class

• People within a social class tend to exhibit similar buying behavior.

• Occupation

• Income

• Education

• Wealth

Subculture

• Groups of people with shared value systems based on common life experiences.

• Hispanic Consumers

• African American Consumers

• Asian American Consumers

• Mature Consumers

Subculture

• Groups of people with shared value systems based on common life experiences.

• Hispanic Consumers

• African American Consumers

• Asian American Consumers

• Mature Consumers

Factors Affecting Consumer Behavior:Factors Affecting Consumer Behavior:Social Social

Groups

• Membership

• Reference

Groups

• Membership

• Reference

Family• Husband, wife, kids• Influencer, buyer, user

Family• Husband, wife, kids• Influencer, buyer, user

Roles and StatusRoles and Status

Social FactorsSocial Factors

Factors Affecting Consumer Behavior:Factors Affecting Consumer Behavior:PersonalPersonal

Personal InfluencesPersonal Influences

Age and Family Life CycleStage

Age and Family Life CycleStage OccupationOccupation

Economic SituationEconomic Situation

Lifestyle IdentificationLifestyle Identification

ActivitiesActivities OpinionsOpinions

InterestsInterests

Personality & Self-ConceptPersonality & Self-Concept

VALSVALS 2 2Principle Oriented Status Oriented Action Oriented

AchieversAchievers

ActualizersActualizers

StrugglersStrugglers

StriversStrivers

FulfilledsFulfilleds

BelieversBelievers

ExperiencersExperiencers

MakersMakers

Abundant ResourcesAbundant Resources

Minimal ResourcesMinimal Resources

Factors Affecting Consumer Behavior:Psychological

Factors Affecting Consumer Behavior:Psychological

Psychological Factors

MotivationMotivation

PerceptionPerception

LearningLearning

Beliefs and Attitudes

Beliefs and Attitudes

Maslow’s Hierarchy of NeedsMaslow’s Hierarchy of Needs

Esteem Needs(self-esteem, status)

Social Needs(sense of belonging, love)

Safety Needs(security, protection)

Physiological Needs(hunger, thirst)

Self Actualization

(Self-development)

Types of Buying Types of Buying DecisionsDecisions

ComplexBuying

Behavior

Dissonance-Reducing Buying

Behavior

Variety-SeekingBehavior

HabitualBuying

Behavior

HighInvolvement

Significantdifferences

betweenbrands

Fewdifferences

betweenbrands

LowInvolvement

The Buyer Decision The Buyer Decision ProcessProcess

Need RecognitionNeed Recognition

Information SearchInformation Search

Evaluation of AlternativesEvaluation of Alternatives

Purchase DecisionPurchase Decision

Postpurchase BehaviorPostpurchase Behavior

The Buyer Decision ProcessStep 1. Need Recognition

The Buyer Decision ProcessStep 1. Need Recognition

External Stimuli

• TV advertising

• Magazine ad

• Radio slogan

•Stimuli in the environment

External Stimuli

• TV advertising

• Magazine ad

• Radio slogan

•Stimuli in the environment

Internal Stimuli

• Hunger

• Thirst

• A person’s normal needs

Internal Stimuli

• Hunger

• Thirst

• A person’s normal needs

Need RecognitionDifference between an actual state and a desired state

Need RecognitionDifference between an actual state and a desired state

The Buyer Decision ProcessThe Buyer Decision ProcessStep 2. Step 2. InformationInformation Search Search

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

•Advertising, salespeople•Receives most information

from these sources

•Mass Media•Consumer-rating groups

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

Personal Sources Personal Sources

Commercial SourcesCommercial Sources

Public SourcesPublic Sources

Experiential SourcesExperiential Sources

The Buyer Decision ProcessStep 3. Evaluation of Alternatives

The Buyer Decision ProcessStep 3. Evaluation of Alternatives

Product AttributesEvaluation of Quality, Price, & Features

Product AttributesEvaluation of Quality, Price, & Features

Degree of ImportanceWhich attributes matter most to me?

Degree of ImportanceWhich attributes matter most to me?

Brand BeliefsWhat do I believe about each available brand?

Brand BeliefsWhat do I believe about each available brand?

Total Product SatisfactionBased on what I’m looking for, how satisfied

would I be with each product?

Total Product SatisfactionBased on what I’m looking for, how satisfied

would I be with each product?

Evaluation ProceduresChoosing a product (and brand) based on one

or more attributes.

Evaluation ProceduresChoosing a product (and brand) based on one

or more attributes.

The Buyer Decision ProcessThe Buyer Decision ProcessStep 4. Purchase DecisionStep 4. Purchase Decision

Purchase IntentionDesire to buy the most preferred brand

Purchase IntentionDesire to buy the most preferred brand

Purchase DecisionPurchase Decision

Attitudes of others

Unexpected situational factors

The Buyer Decision ProcessStep 5. Postpurchase Behavior

The Buyer Decision ProcessStep 5. Postpurchase Behavior

Consumer’s Expectations of

Product’s Performance

Consumer’s Expectations of

Product’s Performance

Dissatisfied Customer

Dissatisfied Customer

Satisfied Customer!

Satisfied Customer!

Product’s Perceived

Performance

Product’s Perceived

Performance

Cognitive Dissonance

Stages in the Adoption ProcessStages in the Adoption Process

AwarenessAwareness

InterestInterest

EvaluationEvaluation

TrialTrial

AdoptionAdoption

Adoption of Adoption of InnovationsInnovationsP

erce

nta

ge

of

Ad

op

ters

Time of AdoptionEarly Late

Inn

ova

tors

Early Adopters

Early Majority

2.5%

13.5%

34% 34%

16%

Laggards

Late Majority


Total set

Awarenessset

Evoked Set

Choice set

decisiion

Influences on the Rate of AdoptionInfluences on the Rate of Adoptionof New Productsof New Products

DivisibilityCan the innovation

be used on a trial basis?

CompatibilityDoes the innovation

fit the values and experience of the

target market?Complexity

Is the innovation difficult to

understand or use?

Relative AdvantageIs the innovation

superior to existing products?

Communicability Can results be easily

observed or described to others?

ProductCharacteristics


Importance of perceived risk•A financial loss-when the product is

faulty and needs replacement or repair at one’s own cost.

•A loss of time – due to hours of making complaints, returning to distributors,

repairs etc.

• a psychological risk- when a bad purchase leads to loss of self esteem or

creates general dissatisfaction•A physical risk- due to consumption or use of products potentially harmful to one’s

health or the environment.


Problem solving approaches

•Extensive problem solving-is adopted when the value of information and/or the perceived risk is high

(unfamiliar brand in an unfamiliar product class)•Limited problem solving- applies to the situation of the buyer confronted with a new, unfamiliar brand in a familiar product class. where existing brands do

not provide an adequate level of satisfaction)•Routine response behavior-is observed in the case where the consumer has accumulated enough

experience and knowledge and has definite preference about one or more familiar brands (low cost,

frequently purchased items)


Ten questions1. Will the product make me feel more

important?2. Will the product make me happier?3. Will the product make me more

comfortable?4. Will the product make me more prosperous5. Will the product make my work easier?6. Will the product give me more security?7. Will the product make me more attractive?

Or better liked.8. Will the product give me more distinction?9. Will the product improve, protect, or

maintain my health?10.Is this purchase a bargain for me ?


Defining Customer ValueDefining Customer Value

-

=

Total CustomerValue

Total CustomerCost

(Product, Service,Personnel, &

Image Values)

(Monetary, Time,Energy, &

Psychic Costs)

CustomerDelivered Value

(Profit to theConsumer)


Customer Satisfaction

Customer Satisfaction Results When a Company’s Performance Has Fulfilled a Buyer’s Expectations.

Buyer’s Expectations Are Based On:

Customer’s Past Buying Experiences Opinions of Friends & Associates Marketer/ Competitor Information & Promises

Pro

du

ct’s

Act

ual

Per

form

ance Performance Exceeds Expectations-

Customer is Delighted

Performance Below Expectations - Customer is Dissatisfied


Total Customer Total Customer SatisfactionSatisfaction

Highly satisfied (delighted) customers produce benefits:Highly satisfied (delighted) customers produce benefits:– They are less price sensitive,They are less price sensitive,– They remain customers longer,They remain customers longer,– They talk favorably about the company and They talk favorably about the company and

products to others.products to others.

Delighted customers have emotional and rational Delighted customers have emotional and rational preferences for products, and this creates high customer preferences for products, and this creates high customer loyalty. loyalty.

Therefore, the purpose of Marketing is to generate Therefore, the purpose of Marketing is to generate customer value profitably.customer value profitably.


The Need for Customer RetentionThe Need for Customer Retention

NewCustomer

Costs

LostCustomer

Costs

CustomerLifetime

Value

The Key to Customer Retention is Superior Customer Value and Satisfaction. Companies Must Consider:


Building Customer Satisfaction and Building Customer Satisfaction and Loyalty by Relationship MarketingLoyalty by Relationship Marketing

StructuralTies

StructuralTies

SocialBenefits

SocialBenefits

Relationship Marketing Involves Creating, Maintaining, and Enhancing Strong, Long-Term Relationships with

Customers and Other Stakeholders.

Methods for Building Relationships Include Offering:

FinancialBenefits

FinancialBenefits


Buying behavior

Buying behavior covers all activity preceding, and following purchase decisions

The purchasing behavior is seen as a process of problem solving and can be grouped into five

stages1. Problem recognition2. Information search

3. Evaluation of alternatives4. Purchase decision

5. Post-purchase behavior


The 5 stage process

1:Problem recognition• The internal recognition by the consumer that their current needs are not being met• Discrepancy between actual & desired state• Leads to motivation• Could be real or imagined, physical or psychological• Implications? Construction of advertising; penetration pricing strategies for new products; importance of peers; social construction of desire.

2:Information SearchNext we ask ourselves the question of how do we solve our problem?•May already be familiar with options available•May consult people whose opinions we respect•May browse around the shops•May consult independent experts•Amount of information required dependent on risk attached•Implications? Role of marketing communications


The 5 stage process (continued)

3:Evaluation of alternatives•In deciding which product to buy we have to weigh up which

product best suits our needs•We construct criteria upon which to base our choice•We already may have a list of criteria or we may form one

during the information search•Compensatory vs. non compensatory evaluation

4: Product choice•Having weighed up the pros and cons between alternatives

eventually we have to make a choice•Could be as a result of the outcome of our evaluation process

against important criteria – best fit.•Choice could be affected by availability, payment options etc.•Implications? Make it easy!


The 5 stage process (continued)

5: Post purchase evaluationOnce we have made our purchase we decide whether its met our expectation

•If it does great positive brand associations and visa versa•Implications? After sales service, marketing communications


Social Norms and ConformitySocial Norms and Conformity

Social normSocial norm – any rule or behavior for – any rule or behavior for meeting societal expectations meeting societal expectations normative systemnormative systemConformity pressuresConformity pressures – actions taken to – actions taken to encourage or force members to act, encourage or force members to act, think and/or express themselves in think and/or express themselves in certain ways.certain ways.The more important a group is in our The more important a group is in our lives, the greater our desire to accept lives, the greater our desire to accept and conform to its normsand conform to its norms


Homan’s EquationHoman’s Equation

The difference between the “price” we pay for conformity and the rewards obtained for doing so determines for each of us whether we will conform to group expectations and

to what extent. Price:•Loss of freedoms•Time commitment•Financial commitment•Etc.

Rewards:•Levels of acceptance•Advancement within the group•Prestige gained•Etc.


Reference Group TypesReference Group Types

Primary reference groupPrimary reference group: one with which the : one with which the individual has frequent face-to-face contact individual has frequent face-to-face contact and in which members are close-knit.and in which members are close-knit.– Examples: families, households, study groups, Examples: families, households, study groups,

work teams, roommates, etc.work teams, roommates, etc.Secondary reference group:Secondary reference group: one in which one in which interaction with other members is less interaction with other members is less frequentfrequentFormal group:Formal group: one in which there is some sort one in which there is some sort of structure and/or for which there are specific of structure and/or for which there are specific membership requirements.membership requirements.Informal group:Informal group: one that has no special one that has no special membership or attendance requirements, membership or attendance requirements, other than common interests.other than common interests.


Reference Group InfluencesReference Group Influences

A reference group is the group A reference group is the group whose perspective an whose perspective an individual takes on in forming individual takes on in forming values, beliefs, attitudes, values, beliefs, attitudes, opinions, and overt behaviors.opinions, and overt behaviors.– They set levels of aspirationThey set levels of aspiration– They help define the actual They help define the actual

items/services considered items/services considered acceptable for displaying acceptable for displaying those aspirations. those aspirations.


Reference Group Types Reference Group Types (continued)(continued)

Membership groupMembership group: one to which a : one to which a person currently belongs.person currently belongs.

Aspirational group:Aspirational group: a group that a a group that a person would like to be part of, but to person would like to be part of, but to which he or she does not currently/ may which he or she does not currently/ may never belongnever belong

DissociativeDissociative group: a group that an group: a group that an individual avoids or denies connection individual avoids or denies connection with.with.


Reference Group Reference Group InfluencesInfluences

Reference groups as Reference groups as – part of the socialization part of the socialization

processprocess– setters of rolessetters of roles– information sourcesinformation sources– normative influencesnormative influences– an expression of self-valuean expression of self-value


Conformity Pressure and Marketplace Conformity Pressure and Marketplace behaviorbehavior

The influence of reference groups The influence of reference groups variesvaries

Groups tend to be more influential Groups tend to be more influential on product decisions than they are on product decisions than they are on either brand or outlet choiceson either brand or outlet choices– Conspicuousness “based on exclusivity” -- Conspicuousness “based on exclusivity” --

product decisions (bikers and black leather product decisions (bikers and black leather jackets)jackets)

– Conspicuousness “associated with the Conspicuousness “associated with the individual” -- brand decisions possible individual” -- brand decisions possible within product class, “allowed personal within product class, “allowed personal expression”expression”


Social PowerSocial Power

Power of reward – praise, Power of reward – praise, approval, acceptance, status, approval, acceptance, status, recognition, etc.recognition, etc.Coercive power – unacceptable Coercive power – unacceptable behavior strongly discouragedbehavior strongly discouragedExpert power – informational Expert power – informational attractionattractionReferent power – closer the Referent power – closer the match between person and match between person and group, more willingness to group, more willingness to conformconform


Black box/CIP modelsBlack box/CIP models

Consumer’sMind

Black box

Consumer”s Mind CIP

inputs outputs

outputinputs

Externalworld

Externalworld

Externalworld

Externalworld


INTERNAL INTERNAL WORLDSWORLDS

EXTERNALWORLD

SENSORYREGISTER

SHORT TERM MEMORY(STM) ORWORKING MEMOTY

LONG TERM

MEMORY (ltm)

STIMULI

Short and long term memoryShort and long term memory


PURCHASE

CONVICTION

PREFRENCE

LIKING

KNOWLEDGE

AWARENESS

Publicity -advertising campaign

Cognitive

The realm of thoughts. Ads provide information & facts

Affective

The realm of emotiions.Ads change attitudes & feelings

Competitive ads.

Argumentative copy

“image” ads

Status glamour appeals

POP ads/deals/price appeals / testimonials

Conative

The realm of motives, ads stimulate or direct desires

Lavidge hierarch of effects model


AttitudesGlobal evaluative judgments

IntentionsSubjective judgments by people about how they will behave in the future

BeliefsSubjective judgments about the relationship between two or more things

FeelingsAn affective state (e.g. current mood state) or reaction (e.g. emotions experienced during product consumption)


Relationships between consumer beliefs, feelings, attitudes and intentions


Consumer beliefsA sampling of consumer beliefs

– If a deal seems to good to be true, it probably is.

– You can’t believe what most advertising says these days.

– Auto repair shops take advantage of women.

– People need less money to live on once they retire.

– It’s not safe to use credit cards on the Internet.

– Appliances today are not as durable as they were 20 years ago.

– Extended warranties are worth the money.

– You get what you pay for: lower price means lower quality.

– Changing the oil in your car every three thousand miles is a waste of money.


Consumer beliefsExpectations

Brand distinctiveness

Inferential beliefs

Consumer confusion


Consumer expectations

Consumers’ willingness to spend is influenced by beliefs about their financial future

Expectations are beliefs about the future


Why should a consumer want to buy your brand instead of the competitor’s?

The desirability of products having something unique to offer to their consumers is also known as the Unique Selling Proposition (USP)

Brand distinctiveness


Inferential beliefs

Consumers use information about one thing to form beliefs about something else

Beliefs are often inferred when product information is incomplete

Also undertaken when consumers interpret certain product attributes as signals of product quality, e.g. price-quality inferential beliefs


Consumer confusionSometimes consumers do not know what to believe due to many different reasons

– May arise due to conflicting information and knowledge

– Mistaking one company’s product for the product of another company

– Due to changes in a product’s position and image

Consumers respond to confusion by:

– Undertaking further information search

– Basing their decision on things that are perfectly clear, e.g. price

– Deferring product purchase indefinitely


Types of consumer feelings

NegativeNegative WarmWarmUpbeatUpbeat

AngryAnnoyedBadBoredCriticalDefiantDisgustedFed-upInsultedIrritatedRegretful

AffectionateCalmConcerned ContemplativeEmotional HopefulKindPeacefulPensiveTouchedWarm-hearted

ActiveAdventurousAliveAttractiveConfidentCreativeElatedEnergeticGoodHappyPleased


Attitude towards objectsAttitude towards objects

• Attitudes---people form attitudes toward objects on the basis of their beliefs (perception and knowledge ) about these objects, beliefs in turn acquired by processing information which is obtained by Direct experience with objects and from communications about them received from other sources

• Information—experience based with objects +communication

received about objects from others.

• Belief---perceptions and knowledge


Fishbeins model of ATOFishbeins model of ATO

IS DESIGNED TO DETERMINE A PERSON’S OVERALL IS DESIGNED TO DETERMINE A PERSON’S OVERALL ATTITUDE TOWARD AN OBJECT.ATTITUDE TOWARD AN OBJECT.

IT IS BASED ON HIS /HER BELIEFS AND FEELINGS ABOUT IT IS BASED ON HIS /HER BELIEFS AND FEELINGS ABOUT VARIOUS ATTRIBUTES OF THE PRODUCT/OBJECT.VARIOUS ATTRIBUTES OF THE PRODUCT/OBJECT.

MODEL IS ALSO REFERRED TO AS MULTIATTRIBUTE MODEL IS ALSO REFERRED TO AS MULTIATTRIBUTE MODEL.MODEL.

n

e

bieiAo1

model

Ao = a persons overall attitude towards the object.

Bi = the strength of his/her belief that object is related to attribute “I”

Ei = evaluation or intensity of feeling towards attribute “I”

N = number of relevant beliefs for that person.


)()( SNwAbwBIB 21

behavior

Behaviorintention

Attitude TowardsPerformingbehavior Subjective

Norms aboutbehavior

W1 and w2 are the weights of relative influence of Ab +SN on Behavioral intention

Behavior –as a function of intentions to behave in a certain manner+ other intervening factorsAttitude– attitude towards acting in that manner + subjective norms,.(others perceptions)

Fishbein Fishbein


Continued.Continued.

To predict behavior

•We determine Ab & SN

•Each is then weighted to reflect importance (add up to 1.0) Ab=the individual Oveeerall attitude

performing specific behavior. B1=persons belief that performing that behavior results in consequence. E1 =persons evaluation of the consequences I. And n= number of relevant behavior beliefs.

k

i

n

i

iiSN

iib

mb

ebA

1

1

Where SN=the individual's subjective norms regarding the specific behavior. Bi= normative belief that reference group or person I thinks he should or should not perform the behavior.

Mi= his motivation to comply with the thoughts of referent I.k= the number of relevant references


Beliefs about Consequences of

behavior

BI modelBI model

Evaluation of consequences

Belief about Perception of

others

Motivations to comply

Attitude towardsbehavior

Subjective normsAbout behavior

BI

Other Intervening

factors

behavior


The Consumer Decision-Making The Consumer Decision-Making ProcessProcess

Post-purchase Behaviour

Purchase

Evaluation of Alternatives

Information Search

Problem Recognition

Individual and Social Factors

and Buying Situation

Individual and Social Factors

and Buying Situation


Types of Consumer Buying Types of Consumer Buying DecisionsDecisions

LessInvolvement

MoreInvolvement

RoutineResponseBehaviour

RoutineResponseBehaviour

LimitedDecisionMaking

LimitedDecisionMaking

ExtensiveDecisionMaking

ExtensiveDecisionMaking

Length of time; Cost of goods; information lackingAnd number of alternatives availableLength of time; Cost of goods; information lackingAnd number of alternatives available


Types of Consumer Buying Types of Consumer Buying DecisionsDecisions

The buying-decision process not always The buying-decision process not always straightforward, e.g. level of involvementstraightforward, e.g. level of involvement

Level of involvement is the amount of effort that Level of involvement is the amount of effort that is expended in satisfying a need.is expended in satisfying a need.

Level of involvement normally higher when Level of involvement normally higher when

Consumer lacks informationConsumer lacks information

If consumer believes the sum of money involved If consumer believes the sum of money involved is largeis large

The product has considerable social importanceThe product has considerable social importance

Product is perceived to provide significant Product is perceived to provide significant benefitsbenefits


Factors Affecting Involvement LevelsFactors Affecting Involvement Levels

SituationSituation

InterestInterest

Perceived RiskPerceived Risk

Previous ExperiencePrevious

Experience

Social VisibilitySocial Visibility

Factors Influencing Involvement

Factors Influencing Involvement


Marketing Implications of InvolvementMarketing Implications of Involvement

High involvement: promotion High involvement: promotion extensive and informative. Provide extensive and informative. Provide information and specify benefits.information and specify benefits.

Low involvement: In-store promotions Low involvement: In-store promotions and packaging important. Must be and packaging important. Must be eye-catching and easily recognisable. eye-catching and easily recognisable.

Tactics such as 2-for-the-price-of-1, Tactics such as 2-for-the-price-of-1, coupons and special offers often used.coupons and special offers often used.


Individual Factors Individual Factors Influencing CBInfluencing CB

PerceptionPerception

Perception is the process of Perception is the process of receiving, organising, and receiving, organising, and assigning assigning meaning to informationmeaning to information or stimuli or stimuli detected by our five sensesdetected by our five senses

Selective perception/exposure Selective perception/exposure

Selective distortionSelective distortion

Selective retentionSelective retention


Individual Factors Individual Factors Influencing CBInfluencing CB

MotivationMotivation

All behaviour start with a needAll behaviour start with a needMaslow Theory - Adverts play on Maslow Theory - Adverts play on motivesmotives

Physiological - Beer bill boardsPhysiological - Beer bill boardsSafety - Burglar alarms, InsuranceSafety - Burglar alarms, InsuranceAffiliation - Hansa/Tea (part of a family)Affiliation - Hansa/Tea (part of a family)Esteem (self respect) - cigarette "jet setter"Esteem (self respect) - cigarette "jet setter"

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Consumer Behavior

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