Z Score,T Score, Percential Rank and Box Plot Graph
Cb
1. CONSUMER BEHAVIOUR
CB is defined as “Observable activities chosen
to maximize satisfaction through the attainment
of economic goods & services such as choice of
retail outlet, preference for particular brands &
so on.”
-Dictionary of Marketing & Advertising
2. CB
CB is also defined as “The Behaviour that
consumers display in searching for , purchasing,
using, evaluating, and disposing of products and
services that they expect will satisfy their
needs.”
-Schiffman & Kanuck
3. CB
• the decision process and physical activity
engaged in when evaluating, acquiring, using or
disposing of goods and services."
- Loudon and Bitta
4. CB can be defined as:
“All psychological, social and physical behaviour
of all potential consumer as they become aware
of, evaluate, purchase, consume and tell others
about products and services.”
5. • Consumer Behavior may be defined as “the
interplay of forces that takes place during a
consumption process, within a consumers’ self
and his environment.
6. • - this interaction takes place between three
elements viz. knowledge, affect and behavior;
• - it continues through pre-purchase activity to
the post purchase experience;
• - it includes the stages of evaluating, acquiring,
using and disposing of goods and services”.
7. • The “consumer” includes both personal
consumers and
business/industrial/organizational consumers.
8. Cognition:
• This includes within its field the “knowledge,
information processing and thinking” part; It
includes the mental processes involved in
processing of information, thinking and
interpretation of stimuli (people, objects, things,
places and events). In our case, stimuli would
be product or service offering; it could be a
brand or even anything to do with the 4Ps.
9. Affect:
• This is the “ feelings” part. It includes the
favorable or unfavorable feelings and
corresponding emotions towards a stimuli (eg.
towards a product or service offering or a
brand). These vary in direction, intensity and
persistence.
10. Behavior
• This is the “visible” part. In our case, this could
be the purchase activity: to buy or not a buy
(again specific to a product or service offering,
a brand or even related to any of the 4 Ps).
11. MARKETING EVOLUTION IN INDIA
PERIOD ENVIRONMENT OPERATIONS INSTITUTIONS
Up to 1920’s Only imports; no domestic
industries
Supply against
firm orders
Supply side of the
market
1920’s-
1940’s
Import of kits & local
assemblies
Book orders with
distribution
Sales & distribution
1950’s Early local manufacturing,
using foreign components
Selling &
redistribution
Sales & redistribution
1950’s-
1970’s
Formation of
manufacturing units
Sales force;
stockiest;
promotion
Sales; redistribution;
promotion, including
advertisement
12. Cont.
1970’s-
1980’s
Some competition;
unrelated diversification;
delicencing
Differentiation Sales; redistribution;
promotion, including
aevertisement
1990’s-2000 Liberalization;
deregulation; lifting of
import barries
Global brands;
branding
Research; product
development; multiple
branding; aggressive
promotion
2001 Integration into world
economy
Global markets Emergence of Indian
MNC’s
13. Changing Perception of Customer
SERVING THE CUSTOMER 1950’s to ’60’s
SATISFYING THE CUSTOMER 1960’s to ’80’s
PLEASING THE CUSTOMER 1980’s to ’90’s
DELIGHTING THE CUSTOMER 1990’s to 2000 AD
RETAINING THE CUTOMER 2000 AD & Beyond
14. Objectives of One-to-One Marketing
• To attain customers
• Sell them more products
• Make a profit
15. Digital Revolution in the Marketplace
• Allows customization of products, services, and
promotional messages like never before
• Enhances relationships with customers more
effectively and efficiently
16. Changes in the Business Environment
• Increased consumer
power
• Access to
information
• More products and
services
• Interactive and
instant exchanges
• Access to customer
patterns and
preferences
• Evolution to other
-Web connection
– PDAs
– HDTV
– Mobile phones
17. Development of the Marketing Concept
Production
Concept
Selling Concept
Product Concept
Marketing
Concept
18. The Production Concept
• Assumes that consumers are interested
primarily in product availability at low prices
• Marketing objectives:
– Cheap, efficient production
– Intensive distribution
– Market expansion
19. The Product Concept
• Assumes that consumers will buy the product
that offers them the highest quality, the best
performance, and the most features
• Marketing objectives:
– Quality improvement
– Addition of features
• Tendency toward Marketing Myopia
20. The Selling Concept
• Assumes that consumers are unlikely to buy a
product unless they are aggressively persuaded
to do so
• Marketing objectives:
– Sell, sell, sell
• Lack of concern for customer needs and
satisfaction
21. The Marketing Concept
• Assumes that to be successful, a company must
determine the needs and wants of specific target
markets and deliver the desired satisfactions
better than the competition
• Marketing objectives:
– Profits through customer satisfaction
22. The Marketing Concept
A consumer-oriented philosophy that
suggests that satisfaction of consumer
needs provides the focus for product
development and marketing strategy to
enable the firm to meet its own
organizational goals.
23. consumer market
“A consumer market can be defined a all the
individuals and households who buy goods and
services for personal consumption.”
24. The Consumers are also aware of the realities
taking place in the market namely:
1. The increasing and continuous flow of new
competitors ready to explode the choice of
the consumers.
2. Global competitors forcing companies to
offer qualitative valued products.
25. PROBLEM SOLVING BEHAVIOUR
TYPE OF
PROBLEM
SOLVING
POSSIBILITY &
VOLUME OF
INFO. STORED
IN MEMORY
NEED FOR
FURTHER
INFO.
SOURCE
OF
FURTHER
INFO.
SPEED OF
INFO.
PROCESSI
NG
CONSUMER’S
DECISION
MAKING IS
FOCUSSED ON
EPS
(Extended
Problem
Solving)
Low High External Slow Learning new
attributes
LPS(Limited
problem
solving )
Moderate Moderate Both
external &
internal
Moderate Using attributes
to compare
alternative brand
choices
RRB
( Routinized
response
behavior)
High Low Internal Fast Use evaluation
results to make
routine decisions
26.
27.
28. a) Extensive problem solving (EPS):
In EPS, the consumer is unfamiliar with the product/service
category; he is not informed of the product or service offering, and
thus, the situation requires extensive information search and
evaluation.
The consumer is not aware:
- about the various decision criteria used to evaluate the product or
service offering.
- of the various brands that are available and from which to evaluate.
29. The result is that the purchase process involves significant effort
on part of the consumer. He has to gather knowledge about (i) the
decision criteria; (ii) the brands available; and (iii) make a choice
amongst the brands.
The types of products and / situations where we generally have
EPS:
1. These goods are ones of high involvement; they are
expensive; they are
infrequently bought; there is considerable amount of risk
involved.
2. These are generally first time purchases
Examples: Jewellery, electronic goods, Real estate and
property etc.
30. b) Limited problem solving (LPS):
The consumer is familiar of the product or
service offering; but he is unaware of the various brands. The case
is one where the buyer
is familiar wit the product category but unfamiliar with the brands.
The consumer:
- is aware of some brands and also of the various criteria used to
evaluate the product or
service offering.
- is unaware of the new brands that have been introduced.
- has not evaluated the brands amongst the awareness set and has
not established
preferences amongst the group of brands.
31. The result is that the purchase process is more of a recurring purchase
and it involves only a moderate effort on part of the consumer. He has to
gather knowledge to add/modify the existing knowledge that he has in
his memory. Thereafter he has to make a decision.
The types of products and / situations where we generally have LPS:
1. These goods are ones of low involvement; they are generally
moderately priced;
they are frequently bought; there is lesser amount of risk involved.
2. These are generally recurring purchases.
Exceptions:
They may also be cases where an expensive product is being
repurchased.
Examples: A laptop replacing a desktop, a second TV for the home.
32. c) Routinized problem solving (RPS) or
routinized response behavior:
The consumer is well informed and experienced with the product or service
offering. The consumer is aware of both the decision criteria as well as the
various brands available.
Here, the goods are ones of low involvement; they are inexpensive; they are
frequently bought; there is no risk involved. These are routine purchases and are
a direct repetition, where the consumer may be brand loyal.
The result is that the purchase process involves no effort on part of the consumer.
It is simple and the process is completed quickly; purchases are routine and made
out of habit.
The types of products and / situations where we generally have RPS:
1. These goods are ones of low involvement; they are inexpensive; they are
frequently bought; there is no risk involved.
2. These are routine purchases and the consumer is brand loyal.
Examples: Staples, Cold drinks, Stationery etc.
33. BUYING SAGE & MARKETING TASK
STAGE RELEVANT QUESTION MARKETING TASK
Needs &
motivation
What motivates the customer Think of the link between
product attributes, benefits &
motivation to avail of the
benefits.
Stimulus Type of purchase:
Frequent/infrequent;
Low/high involvement
Show case the problem or
opportunity
Examination What are the option available to the
customer.
Relate product attributes to
needs & wants & then motives
so that brand enters the choice
set.
Explore Does customer need more
information for decision
Provided adequate information
in comprehensive form.
34. Impact of new technology on
marketing strategies
• Increased consumer
power
• Access to
information
• More products and
services
• Interactive and
instant exchanges
• Access to customer
patterns and
preferences
• Evolution to other
-Web connection
– PDAs
– HDTV
– Mobile phones
35. Select •What is the actual range of
information available
•What is the basis of choce
•What are other influences
•Make sure that our brand
has salience
•Talk about relevant
motivator/discriminator
•Make sure that
favourable influences are
reinforced & negative ones
are countered through
effective communication.
Purchase How final selection is made Promote the marketer’s
offer heavily while
weakening the other
marketer’s offers
36. Experience Have expectations been met Reduce cognitive
dissonance, while
increasing satisfaction
Repeat
purchase
What about loyalty • Keep reminding the
customers
• Constantly claim
market leadership.
37. The marketer is always probing &
trying to learn
• Who buys products / services?
• How do they buy products / services?
• When do they buy goods / services?
• Where do they buy goods / services?
• Why do they buy goods / services?
• How often do they buy? and so on…
38. INVOLVEMENT & CONSUMER BEHAVIOUR
FACTOR HIGHLY INVOLVED
(ACTIVE) CUSTOMER
LOWLY INVOLVED
(PASSIVE) CUSTOMER
Information
search
Seek out information from
various commercial &
noncommercial sources
Passively gathers information
that comes his way
Information
processing
Processes the information
carefully
Learns the information in a
random fashion
Expectation Chooses that brand which is
expected to provided
maximum satisfaction
Subject to minimum
acceptable level of
satisfaction, the customer
choose that brand which is
likely to give the least
problem.
39. Influence on
customer of
group norm
Group norms & values dictate
product choice; so reference
group acts as a source of
information.
Group norms don’t exist. So
reference group influence does
not work here.
Influence of
personality &
lifestyle
Behaviour is influenced by
personality & lifestyle
Personality & lifestyle as
influences are not very relevant.
Marketer’s role
as information
provider
If perceived as sponsored
information (say advertising) the
impact is limited since all
information is processed carefully
to avoid risky decision.
Since all information including
advertising claims are accepted
uncritically, advertising proves to
be effective here.
Cont…
40. The Traditional Marketing Concept Vs. Value & Retention – Focused
Marketing
THE TRADITIONAL
MARKETING CONCEPT
Make only what you can sell
instead of trying to sell what you
make.
Do not focus on the product;
focus on the need that it satisfies.
Market products & services that
match customers’ need better
than competitors’ offerings.
VALUE & RETENTION-
FOCUSED MARKETING
Use technology that enables
customers to customize what you
make.
Focus on the product's perceived
value, as well as the need that it
satisfies.
Utilize an understanding of
customer needs to develop
offerings that customers perceive
as more valuable than
competitors’ offerings.
41. Research consumer needs &
characteristics.
Understand the purchase behaviour
process & the influences on consumer
behaviour.
Realize that each customer transaction
is a discrete sale.
Segment the market based on
customers’ geographic, demographic,
psychological, sociocultural, lifestyle &
product-usage related characteristics.
Research the levels of profit associated
with various consumer need &
characteristics
Understand consumer behaviour in
relation to the company’s product.
Make each customer transaction part of
an ongoing relationsh8ip with the
customer.
Use hybrid segmentation that combines
the traditional segmentation bases with
data on the customer’s purchase levels
& patterns of use of the company's
products.
42. Target large groups of customers that
share common characteristics with
messages transmitted through mass
media.
Use one way promotions whose
effectiveness is measured through sales
data of marketing surveys.
Create loyalty programs based on the
volume purchased.
Encourage customers to stay with the
company & buy more.
Invest in technologies that enable you
to send one-to-one promotional
messages via digital channels.
Use interactive communications in
which messages to customers are
tailored according to their responses to
previous communications.
Create customer tiers based on both
volume & consumption patterns.
Make it very unattractive for your
customers to switch to a competitor &
encourage them to purchase “better”- in
a manner that will raise the company’s
profitability levels.
44. Personal Consumer
• :
1. Personal consumer buys goods &
services for his or her own use,
for the use of his /her household, or as a gift for
someone, e.g., shaving cream, T.V., V.C.R., book,
etc.
2. The personal consumer is sometimes also referred to
as end user or ultimate consumer.
45. Industrial Consumer
• :
1. Organizational buyers are those who buy goods & services for
the purpose of further production, resale & redistribution.
2. The industrial buyer buys goods & services for the purpose of
increasing sales, cutting costs and supplying their product to
consumers at the lowest costs consistent with quality.
3. Organizational consumer include profit & non profit
businesses, government agencies & institution.
46. INDUSTRIAL BUYING
“Organizational buying is the decision-making
process by which formal organizations establish
the need for purchased products & services &
identify, evaluate & choose among alternative
brands & supplies.”
-Webster & Wind
47. Buying Situation
• Straight Rebuy:
The straight rebuy is a buying situation in which the
purchasing department reorders on a routine basis.
• Modified Rebuy:
The modified rebuy is a situation in which the buyer wants to
modify product specifications, prices, delivery requirements,
or other terms. The modified rebuy usually involves additional
decision participants on both the buyer & seller sides.
48. • New Task:
The new task is a buying situation in which a purchaser
buys a product or service for the first time. New task
buying passes through several stages: awareness, interest,
evaluation, trial and adoption.
Cont…
49. Some consumer Behaviour Roles’
No. Description Role
1 The individual who determine that some need or
want is not being met & authorities a purchase to
rectify the situation.
Initiator
2 A person who by some need or unintentional word
or action influences the purchase decision, the
actual purchase, and the use of the product or
services.
Influencer
3 The individual who actually makes the purchase
transaction.
Buyer
4 The person most directly involved in the
consumption or use of the purchase.
User
50. Example: 1
A kindergarten girl needs to buy color crayons to use in class.
i) Initiator: The girl
ii) Influencer: Her teacher or her classmates
iii) Decider: Either of the parents
iv) Buyer: Either of the parents or a sibling.
v) User: The girl herself.
51. Example 2:
The mother of the house is a housewife; she loves watching TV
when her husband and children go for work. She has been
complaining that the present TV set at home has been
giving problem. She also says that the model is now an old one and
that that the family should own a new model.
i) Initiator: The lady
ii) Influencer: Her neighbors and friends.
iii) Decider: Joint: Her husband, she herself and the children.
iv) Buyer: Husband or son or daughter or she herself.
v) User: The family.
52. Example 3:
A boy enters college and needs a laptop for doing assignments.
i) Initiator: The boy himself
ii) Influencer: His friends and classmates.
iii) Decider: The boy himself.
iv) Buyer: The boy himself.
v) User: The boy himself.
53. Buying Process
1. Problem recognition
2. General need description
3. Product specification
4. Supplier search
5. Proposal solicitation
6. Supplier selection
7. Order-routine specifications
54. The Major Influences on Industrial
Buyers
• Environment Factor
• Organizational Factor
• Interpersonal Factor
• Individual Factor
55.
56. Consumer Satisfaction
1. Satisfaction is a person’s feelings of pleasure or
disappointment, resulting from comparison of a product’s
perceived performance and actual performance in
relation to his or her expectations.
2. Consumer satisfaction is a function of the product’s
perceived performance and the consumer’s expectation.
57. Cont…
3. Satisfaction is often a subjective phenomenon and
depends on the consumer’s state of mind both at the time
of purchase and more importantly at the time of
consumption.
4. It is important because in a large number of cases, some
degree of post purchase dissonance is evident among
consumers.
58. Characteristics of a Customer-oriented
Organization
1. Customers are always put in front.
2. Through market and customer service planning.
3. Commitment to the quality of service.
4. Integrated approach and people’s involvement.
5. Customer research and feedback.
6. Setting and monitoring service standards.
59. Indicators of satisfied customer bases
• Repeat orders in a competitive market.
• A positive word-of-mouth reference about the product to
likely users in the industry.
• Response the product receives to any new launch.
• Interest shown by visitors to the stall in industrial
exhibitions.
• Brand awareness and recall. If the customer is loyal or
satisfied, the product will be on the top of his mind.
61. The various disciplines having
influence on the CB
Sr.
No.
Discipline Comprising of or governed by
1. Economics Demand, Supply, Income,
Purchasing , Power.
2. Psychology Needs & Motivation, Personality,
Perception, Learning, Attitude.
3. Sociology Society, Social class, Power,
Esteem, Status.
62. Cont…
Sr.
No.
Discipline Comprising of or governed by
4. Socio
Psychology
Group Behaviour, Conformity
to group norms, Group
influences, Role leader.
5. Cultural
Anthropology
Attitude towards wealth, Joint
family system.
63. • Psychology: This includes the study of the
individual as well as the individual
determinants in buying behavior, viz., consumer
perception, learning and memory, attitude, self-
concept and personality, motivation and
involvement, attitudes and attitudinal change
and, decision making.
64. • Sociology: This includes the study of groups
as well as the group dynamics in buying
behavior, viz., family influences, lifestyles and
values, and social group influences.
65. • Social psychology: This includes the study of
how an individual operates in group/groups and
its effects on buying behavior viz, reference
groups and social class influences.
66. • Anthropology: This is the influence of
society on the individual viz., cultural and
cross-cultural issues in buying behavior,
national and regional cultures etc.
67. • Economics: This is the study of income and
purchasing power, and its impact on consumer
behavior. The underlying premise is that
consumers make rational choices while making
purchase decisions. While resources are limited
and needs and wants many, consumers collect
information, and evaluate the various
alternatives to finally make a rational decision.
68. Nature & Characteristic of Indian
Consumer
“Market may be defined as a relationship
between consumer and producer occuring at a
time and place and at a value mutually
agreeable and acceptable to the concerned
parties.”
- Philip Kotler
69. Nature of Consumer Behavior
• The subject deals with issues related to
– cognition, affect and behavior in consumption behaviors, against the backdrop of
individual and environmental determinants.
– The individual determinants pertain to an individual’s internal self and include
psychological components like personal motivation and involvement, perception,
learning and memory, attitudes, self-concept and personality, and, decision
making.
– The environmental determinants pertain to external influences surrounding an
individual and include sociological, anthropological and economic components
like the family, social groups, reference groups, social class, culture, sub-culture,
cross-culture, and national and regional influences.
70. • The subject can be studied at micro or macro levels depending upon
whether it is analyzed at the individual level or at the group level.
• The subject is interdisciplinary.
– It has borrowed heavily from psychology (the study of the individual: individual
determinants in buying behavior),
– sociology (the study of groups: group dynamics in buying behavior),
– social psychology (the study of how an individual operates in
group/groups and its effects on buying behavior),
– anthropology (the influence of society on the individual: cultural and
cross-cultural issues in buying behavior), and
– economics (income and purchasing power).
•
71. • Consumer behavior is dynamic and interacting in nature.
– The three components of cognition, affect and behavior of individuals alone or
in groups keeps on changing; so does the environment.
– There is a continuous interplay or interaction between the three components
themselves and with the environment.
– This impacts consumption pattern and behavior and it keeps on evolving and it is
highly dynamic.
• Consumer behavior involves the process of exchange between
the buyer and the seller, mutually beneficial for both.
72. • As a field of study it is descriptive and also analytical/ interpretive.
– It is descriptive as it explains consumer decision making and behavior in the
context of individual determinants and environmental influences.
– It is analytical/ interpretive, as against a backdrop of theories borrowed from
psychology, sociology, social psychology, anthropology and economics, the
study analyzes consumption behavior of individuals alone and in groups.
– It makes use of qualitative and quantitative tools and techniques for research and
analysis, with the objective is to understand and predict consumption behavior.
73. • It is a science as well as an art.
– It uses both, theories borrowed from social sciences to understand consumption
behavior, and
– quantitative and qualitative tools and techniques to predict consumer behavior.
74. Characteristic features of Indian
Consumers
I
N
D
I
A
N
C
O
N
S
U
M
E
R
1. Geography
2. Population
3. Urban – rural
composition
4. Sex
composition
5. Age Factor
6. Literacy level
7. Income level
8. Linguistic
diversity
9. Religion
10. Dress, Food
Habits & Festival
76. Consumer Research
• The process and tools used to study consumer
behavior.
• Two perspectives:
– Positivist approach
– Interpretivist approach
77. Segmentation, Targeting, and
Positioning
• Segmentation: process of dividing the market
into subsets of consumers with common needs
or characteristics
• Targeting: selecting one ore more of the
segments to pursue
• Positioning: developing a distinct image for the
product in the mind of the consumer
78. Successful Positioning
• Communicating the
benefits of the product,
rather than its features
• Communicating a
Unique Selling
Proposition for the
product
82. • LOYALISTS
• Those who have high satisfaction and high
loyalty.
– Sub-segments are Apostles, who have the highest
satisfaction and loyalty scores, and Near Apostles,
who give high ratings for both, but at a slightly
lower level.
83. • Hotel brands create Apostles when they deliver not
only superior products and services, but also create an
emotional connection derived from the total
experience. These customers are loyal because
they love a business. The Ritz-Carlton and Four
Seasons have created apostles who are so satisfied that
they want to convert others to share
their experience. These are your most important
customers – protect them to the best of your ability.
84. • DEFECTORS
• those who have low satisfaction and low
loyalty.
– A sub-segment comprises the Terrorists, with the
lowest satisfaction and loyalty scores. In addition
with the costs associated with losing them, these
customers are so unhappy that they speak out
against a brand at every opportunity.
85. • Hotel brands found in the Defector quadrant
include a number of chains whose productsand
services have not evolved as quickly as
customer expectations have changed.Customer
feedback can uncover changing needs,
or dissatisfaction, while there is stilltime to
address them
86. • HOSTAGES
• those who have low satisfaction, but still report
high loyalty. Thistypically is due to lack of
competition or high switching costs. Customers
in thiscategory feel “trapped.”
87. • Hotel brands in this category often win business
simply due to their location (when nosuitable
alternatives are nearby) or, because of the strength of
their loyalty club.
• However, these customers exhibit “false loyalty” -
acting loyal even when they are justwaiting for a
chance to jump ship. The strategy for these guests is to
improvecommunication with them - understand
and address their concerns to convert them toLoyalists.
88. • MERCENARIES
• those who have high satisfaction, but low
loyalty. These customers areoften price-
sensitive and will switch easily when they
have the opportunity
89. • Companies in this category may provide superior
products and services but do not standout from the
competition. They may be seen as interchangeable with
other similar levelhotels because they have not created
a passion for their brand (like the Loyalists have).For
these customers, you may want to assess your pricing
versus the competition or refine your marketing
messages to convey value delivered. Incorporating
barrier-to-exitelements in your product may also help
retain these guests.
90. • The Apostle Model is especially valuable because it measures
both satisfaction and loyalty, provides a robust method of
understanding and grouping customers, and helps you take
action on a customer-by-customer or market-by-market basis.
Most importantly, this model provides advance warning of
customer dissatisfaction, so you can take steps to preserve the
relationship before it’s too late.Jonathan Barsky and Lenny
Nash are principles with Market Metrix
LLC(MarketMetrix.com), a firm that provides customer and
employee survey programs for the hospitality industry. For
more information, call (800) 239
93. Firm’s Marketing Efforts
1. Product
2. Promotion
3. Price
4. Channels of distribution
Sociocultural Environment
1. Family
2. Informal sources
3. Other noncommercial sources
4. Social class
5. Subculture and culture
Output
Process
Input
ExternalInfluenceConsumerDecisionMaking
Post-Decision
Behavior
Postpurchase Evaluation
Purchase
1. Trial
2. Repeat purchase
Need Recognition
Prepurchase
Search
Evaluation of
Alternatives
Psychological Field
1. Motivation
2. Perception
3. Learning
4. Personality
5. Attitudes
Experience
Figure 1-1:
A Model of
Consumer
Decision Making
95. Quantitative Research
• Descriptive in nature.
• Enables marketers to “predict” consumer
behavior.
• Research methods include experiments, survey
techniques, and observation.
• Findings are descriptive, empirical and
generalizable.
97. Qualitative Research
• Consists of depth interviews, focus groups,
metaphor analysis, collage research, and
projective techniques.
• Administered by highly trained interviewer-
analysts.
• Findings tend to be subjective.
• Small sample sizes.
99. APPROACHES TO CONSUMER
BEHAVIOR RESEARCH:
• Broadly speaking there are two approaches
towards consumer behavior research.
• These are (a) Traditional approach (b) Current
approach.
• These can be further divided into sub
approaches.
100. Traditional approach
• Positivist approach:
– This approach also referred to as “modernism”, is the earliest
approach to studying consumer behavior and treats the study as an
applied science; the paradigm lays emphasis on science as a means
of explaining behavior.
– It lays emphasis on the causes of consumer behavior and as per its
proponents, these causes are directly related to effects. Thus, it
treats consumers as “rational” human beings, who make purchase
decisions after collecting information and weighing all
alternatives.
– The process of consumer decision making is looked upon as one
of “rationality.”
101. – The approach is based on certain assumptions viz.,
• consumer actions based on cause and effect relationship
can be generalized; they can be objectively measured and
empirically tested;
• If a marketer/researcher could identify the reasons behind
consumption behavior; he would be able to predict it; and
if they could predict consumer behavior, they could
influence it.
– The focus lies on prediction of consumer behavior.
– The methodology is essentially quantitative, with
techniques including surveys, observations, and,
experiments. It aims at drawing conclusions on
large samples
102. • Interpretivist Approach:
– This approach is also referred to as “post-modernism or
experientalist.”
– Gradually there was a shift in the approach towards the
study of consumer behavior and the positivist approach gave
way to a new approach that came to be called post-
modernism.
– The approach lays emphasis on understanding the customer
better. It treats consumer decision making process as one
which is “subjective.” Thus while the approach is essentially
subjective, the researchers following this approach try to
identify common patterns.
103. • This approach is also based on certain
assumptions viz.:
– Consumer actions are unique and different both,
between two consumers, and/or within the same
consumer at different times and situations.
– A cause and effect relationship cannot be
generalized; consumption patterns and behaviors are
unique; these are unpredictable.
– They cannot be objectively measured, empirically
tested and generalized.
104. • The focus lies on the act of consumption rather
than the act of purchase.
• The methodology is essentially qualitative, with
techniques including in depth interviews, focus
group techniques, projective techniques.
• It aims at drawing conclusions on small
samples.
105. Current approach: ‘Dialectical’:
• The term ‘dialectics’ considers all forms of
human behavior; thus the current approach to
the study of consumer behavior research is
broader in scope.
• This is further divided into four approaches,
Materialism, Change, Totality and
Contradiction.
106. • Materialism: This approach implies that
consumer behavior is shaped by the ‘material
environment’ eg. money, possessions etc.
• Change: Consumer behavior is ‘dynamic’ in
nature; it is always in a process of continuous
motion, transformation and change.
• Totality: Consumption behavior is
‘interconnected’ with other forms of human
behavior, like personal self and the surrounding
environment.
• Contradiction: Views changes in consumer
behavior as arising from their contradictions,
like moods, emotions etc.
107. • The approach studies the consumer as a
complex total whole and views consumer
purchase as well as consumption processes.
• The current approach to studying Consumer
Behavior uses both the quantitative as well as
qualitative approaches.
108. The Consumer Research Process
• Six steps
– defining the objectives of the research
– collecting and evaluating secondary data
– designing a primary research study
– collecting primary data
– analyzing the data
– preparing a report on the findings
109. Figure 2.1 The Consumer Research Process
Develop Objectives
Collect Secondary Data
Design Qualitative Research
• Method
• Screener questionnaire
• Discussion guide
Prepare Report
Analyze Data
(Subjective)
Conduct Research
(Using highly trained
interviewers) Exploratory
Study
Prepare report
Analyze Data
(Objective)
Collect Primary Data
(Usually by field staff)
Design Quantitative Research
• Method
• Sample design
• Data collection instrument
110. Developing Research Objectives
• Defining purposes and objectives helps
ensure an appropriate research design.
• A statement of objectives helps to define the
type and level of information needed.
111. Secondary Versus Primary Data
• Secondary data: data
that has been
collected for reasons
other than the
specific research
project at hand
• Primary data: data
collected by the
researcher for the
purpose of meeting
specific objectives
112. Table 2.2 Major Sources of
Secondary Data
Government
Publications
Internal
Sources
Periodicals
&
Books
Commercial
Data
114. Observational Research
• Helps marketers gain an in-depth understanding of
the relationship between people and products by
watching them buying and using products.
• Helps researchers gain a better understanding of
what the product symbolizes.
• Widely used by interpretivist researchers.
115. Experimentation
• Can be used to test the relative sales appeal of
many types of variables.
• Only one variable is manipulated at a time,
keeping other elements constant.
• Can be conducted in laboratories or in the field.
120. Attitude Scales
• Likert scales: easy for researchers to prepare
and interpret, and simple for consumers to
answer.
• Semantic differential scales: relatively easy to
construct and administer.
• Rank-order scales: subjects rank items in order
of preference in terms of some criteria.
121. Figure 2.4 Example of a Likert Scale
Please place the number that best indicates how strongly you
agree or disagree with each of the following statements about
shopping online in the space to the left of the statement.
1 = Agree Strongly
2 = Agree
3 = Neither Agree or Disagree
4 = Disagree
5 = Disagree Strongly
_____ a. It is fun to shop online.
_____ b. Products often cost more online.
_____ c. It is a good way to find out about new products.
122. Figure 2.4 Semantic Differential Profiles of
Three Pay-Per-Movie Services
1
2
3
4
5
Cost
Availability
Numberof
Titles
Easeof
Access
Clarityof
Picture
DVD
Digital
Cable
DIVX
ExcellentNeutralPoor
123. Figure 2.5 Rank-Order Scales
Rank the following computer manufacturers in terms
of hotline help by placing a 1 next to the one who
provides the best telephone help, a 2 next to the
second best, until you have ranked all six.
_____ IBM _____Hewlett Packard
_____ Dell _____ Gateway
_____ Compaq _____ NEC
125. Focus GroupFocus Group
A qualitative research
method in which eight to
ten persons participate in
an unstructured group
interview about a product
or service concept.
126. Figure 2.5 Selected Portions of a
Discussion Guide
1. Why did you decide to use your current cellular company?
(Probe)
2. How long have you used you current cellular company?
(Probe)
3. Have you ever switched services? When? What caused the
change? (Probe)
4. What do you think of the overall quality of your current
service? (Probe)
5. What are the important criteria in electing a cellular
service? (Probe)
128. Metaphor Analysis
• Based on belief that metaphors are the most
basic method of thought and communication.
• Zaltman Metaphor Elicitation Technique
(ZMET) combines collage research and
metaphor analysis to bring to the surface the
mental models and the major themes or
constructs that drive consumer thinking and
behavior.
129. Sampling Plan Decisions
Whom to survey?Whom to survey?
How many?How many?
How to
select them?
How to
select them?
130. Table 2.6 Probability Sampling
Designs
Simple random
sample
Every member of the population has a known and
equal chance of being selected.
Systematic random
sample
A member of the population is selected at random and
then every “nth” person is selected.
Cluster (area) sample The population is divided into mutually exclusive
groups (such as blocks), and the researcher draws a
sample of the groups to interview.
Stratified random
sample
The population is divided into mutually exclusive
groups (such as age groups), and random samples are
drawn from each group.
131. Table 2.6 Nonprobability Sampling
Designs
Convenience sample The researcher selects the most accessible population
members from whom to obtain information (e.g.,
students in a classroom)
Judgment sample The researcher uses his or her judgment to select
population members who are good sources for accurate
information (e.g., experts in the relevant field of study).
Quota sample The researcher interviews a prescribed number of
people in each of several categories (e.g., 50 men and 5
women).
133. Figure 4.1 Model of the Motivation Process
LearningLearning
Needs
wants, and
desires
Needs
wants, and
desires
TensionTension
Goal or
need
fulfill-
ment
Goal or
need
fulfill-
ment
DriveDrive BehaviorBehavior
Cognitive
processes
Cognitive
processes
Tension
reduction
Tension
reduction
134. Types of Needs
• Innate Needs
– Physiological (or biogenic) needs that are
considered primary needs or motives
• Acquired needs
– Generally psychological (or psychogenic) needs that
are considered secondary needs or motives
135. Goals
• Generic Goals
– the general categories of goals that consumers see as
a way to fulfill their needs
– e.g., “I want to get a graduate degree.”
• Product-Specific Goals
– the specifically branded products or services that
consumers select as their goals
– e.g., “I want to get an MBA in Marketing from
Kellogg School of Management.”
136. The Selection of Goals
• The goals selected by an individual depend on
their:
– Personal experiences
– Physical capacity
– Prevailing cultural norms and values
– Goal’s accessibility in the physical and social
environment
137. Motivations and Goals
• Positive Motivation
– A driving force
toward some object
or condition
• Approach Goal
– A positive goal toward
which behavior is
directed
• Negative Motivation
– A driving force away
from some object or
condition
• Avoidance Goal
– A negative goal from
which behavior is directed
away
138. Rational Versus Emotional Motives
• Rationality implies that consumers select goals
based on totally objective criteria such as size,
weight, price, or miles per gallon
• Emotional motives imply the selection of goals
according to personal or subjective criteria
139. The Dynamic Nature of Motivation
• Needs are never fully satisfied
• New needs emerge as old needs are satisfied
• People who achieve their goals set new and
higher goals for themselves
140. Frustration
Failure to achieve a goal
may result in
frustration. Some adapt;
others adopt defense
mechanisms to protect
their ego.
143. • Rationalization is something that every human
being does, probably on a daily basis.
Rationalization is defined as “Creating false but
plausible excuses to justify unacceptable
behavior.” An example of this would be a
student stealing money from a wealthy friend of
his, telling himself “Well he is rich, he can
afford to lose it.”
144. • Identification is defined as “Bolstering self-
esteem by forming an imaginary or real
agreement with some person or group.” This is
a fairly common method of attempting to forget
about ones troubles, happens fairly often,
especially in insecure people. A person joining
a sports team, fraternity, social clique or even
subcultures are all examples of this.
145. • Displacement is defined as “Diverting emotional
feelings (usually anger) from their original source to a
substitute target.” This frequently occurs in families,
where we often see the father getting mad at the
mother. The mother then takes her anger out on her
son, the son in turn yells at his little sister, the little
sister kicks the dog, and the dog bites the cat. Another
example would obviously be a boxer taking out his
frustration on a punching bag or an opponent.
146. • Projection is defined as “Attributing one’s own
thoughts, feelings, or motives to another.” This
characteristic is not uncommon, and we have
probably all witnessed it. An angry man might
accuse others of being hostile and antagonistic.
Another example might be a con-artist might be
under the impression that everyone else is
trying to con him or her.
147. • Regression is defined as “A reversion to immature
patterns of behavior.” There are plenty of examples of
this (and we all know a couple we are guilty of). One
of the more obvious examples might be a teenager not
allowed to go on a trip for spring break, so he or she
might throw a temper tantrum and scream and cry at
his or her parents. Conversely, a teenager might revert
back to infant behavior to receive sympathy from his
or her parents.
148. • Reaction formation is one of the odder defense
mechanisms, as it entails behaving completely
contrary to how one truly feels. It is defined as
“Behaving in a way that is exactly the opposite
of one’s true feelings.” We see this all the time
in relationships, where “I despise him” becomes
“I love him.” Similarly, a boss might give an
employee who he is frustrated with a raise.
149. • Repression is defined by “Keeping distressing thoughts and feelings
buried in the unconscious.” There has been much controversy over
repressed memories, and many court cases as a result of this. A little
girl’s memory of being molested when she was a toddler might
become a repressed memory. The little girl will completely forget
about this experience, until the memory might resurface years later.
The trouble is, there have been various accounts of memories
resurfacing that have no truth or bearing to them. Repressed memories
then are unreliable and oftentimes untrue. Conversely; there have
been several cases of repressed memories being accurate; one must
simply take an account of a repressed memory with a grain of salt.
150. Arousal of Motives
• Most of our specific needs are dormant much of the
time.
• The arousal of any specific set of needs at a specific
point in time may be caused by internal stimuli found
in our physiological conditions, or in our emotional or
cognitive processes, or by external stimuli in the
outside environment.
• For the most part, purchases will not be made unless
we experience a need and are activated to satisfy it.
Unsatisfied needs create a state of tension.
151. • There is agreement that most individuals are tension avoiders.
• However, if tension cannot be avoided, most of us would
wish to resolve the tension as quickly as possible, and this
creates a certain type of behavior.
• The amount of energy we are willing to expend in the
purchase of a product is a function of both the level of tension
the unsatisfied need state creates and the degree to which we
think the product will satisfy the need.
• Motivation levels can, therefore, range from passion to
inertia. In turn, this affects the level of involvement that
consumers display in the purchase situation.
153. • Physiological Arousal
– Bodily needs at any specific moment are rooted in
our physiological condition at that moment. A drop
in blood sugar level, or stomach contractions, will
trigger awareness of a hunger need. A decrease in
body temperature will induce shivering, which
makes us aware of the need for warmth.
154. • Emotional Arousal
– Thinking or daydreaming sometimes results in the arousal or
stimulation of latent needs. People who are bored or frustrated in
attempts to achieve their goals often engage in daydreaming, in
which they imagine themselves in all sorts of desirable situations.
These thoughts tend to arouse dormant needs, which may produce
uncomfortable tensions that ‘push’ them into goal-oriented behavior.
A young woman who dreams of becoming a business tycoon may
enroll in business school. A young man who wants to play
professional football may identify with a major league player and use
the products he endorses commercially.
155. • Cognitive Arousal
– Sometimes random thoughts or a personal
achievement can lead to a cognitive awareness of
needs. An advertisement that provokes memories of
home might trigger instant recognition of the need
to speak with someone special.
– This is the basis for many long-distance telephone
company campaigns that stress the low cost
of international long-distance rates.
156. • Environmental Arousal
– The set of needs activated at a particular time are
often determined by specific cues in the
environment. Without these cues, the needs would
remain dormant.
– For example, the six o’ clock news, the sight or
smell of freshly baked bread, fast food TV
commercials, the children’s return from school – all
these may arouse the “need” for food.
157. Philosophies Concerned With
Arousal of Motives
• Behaviorist School
– Behavior is response to stimulus
– Elements of conscious thoughts are to be ignored
– Consumer does not act, but reacts
• Cognitive School
– Behavior is directed at goal achievement
– Need to consider needs, attitudes, beliefs, etc. in
understanding consumer behavior
159. Table 4.3 Murray’s List of
Psychogenic Needs
Needs Associated with Inanimate Objects:
Acquisition, Conservancy, Order, Retention, Construction
Needs Reflecting Ambition, Power,
Accomplishment, and Prestige:
Superiority, Achievement, Recognition, Exhibition, Infavoidance
Needs Connected with Human Power:
Dominance, Deferrence, Similance, Autonomy, Contrariance
160. Table 4.3 Murray’s List of
Psychogenic Needs
Sado-Masochistic Needs :
Aggression, Abasement
Needs Concerned with Affection between People:
Affiliation, Rejection, Nurturance, Succorance, Play
Needs Concerned with Social Intercourse:
Cognizance, Exposition
161. A Trio of Needs
• Power
– individual’s desire to control environment, control
to others, need related to ego
• Affiliation
– need for friendship, acceptance, and belonging
• Achievement
– need for personal accomplishment
– closely related to egoistic and self-actualization
needs
163. What is
Personality?
The inner psychological
characteristics that both
determine and reflect how
a person responds to his
or her environment.
164. The Nature of Personality
• Personality reflects individual differences
• Personality is consistent and enduring
• Personality can change
165. Theories of Personality
• Freudian theory
– Unconscious needs or drives are at the heart of
human motivation
• Neo-Freudian personality theory
– Social relationships are fundamental to the
formation and development of personality
• Trait theory
– Quantitative approach to personality as a set of
psychological traits
166. Freudian Theory
• Id
– Warehouse of primitive or instinctual needs for
which individual seeks immediate satisfaction
• Superego
– Individual’s internal expression of society’s moral
and ethical codes of conduct
• Ego
– Individual’s conscious control that balances the
demands of the id and superego
167. Freudian Theory and
“Product Personality”
• Consumer researchers using Freud’s personality
theory see consumer purchases as a reflection
and extension of the consumer’s own
personality
169. Horney’s CAD Theory
• Using the context of child-parent relationships,
individuals can be classified into:
– Compliant individuals
– Aggressive individuals
– Detached individuals
173. Trait Theory
• Personality theory with a focus on
psychological characteristics
• Trait - any distinguishing, relatively enduring
way in which one individual differs from
another
• Personality is linked to how consumers make
their choices or to consumption of a broad
product category - not a specific brand
174. Personality Traits and Consumer
Innovators
• Innovativeness
• Dogmatism
• Social Character
• Need for uniqueness
• Optimum
stimulation level
• Variety-novelty
seeking
176. Table 5.2
A Consumer Innovativeness Scale
1. In general, I am among the last in my circle of friends to buy
a new (rock albuma
) when it appearsb
.
2. If I heard that a (new rock album) was available in the store,
I would be interested enough to buy it.
3. Compared to my friends, I own few (rock albums).b
4. In general, I am the last in my circle of friends to know the
(titles of the latest rock albums).b
5. I will buy a new (rock album), even if I haven’t heard it yet.
6. I know the names of (new rock acts) before other people do.
177. Dogmatism
A personality trait that
reflects the degree of
rigidity a person displays
toward the unfamiliar and
toward information that is
contrary to his or her own
established beliefs.
178. Dogmatism
• Consumers low in dogmatism (open-minded)
are more likely to prefer innovative products to
established or traditional alternatives
• Highly dogmatic consumers tend to be more
receptive to ads for new products or services
that contain an appeal from an authoritative
figure
179. Social Character
Inner-Directed
• Consumers who tend to
rely on their own inner
values
• More likely to be
innovators
• Tend to prefer ads that
stress product features
and benefits
Other-Directed
• Consumers who tend to
look to others for
direction
• Less likely to be
innovators
• Tend to prefer ads that
feature social acceptance
181. OptimumOptimum
StimulationStimulation
Levels (OSL)Levels (OSL)
A personality trait that
measures the level or
amount of novelty or
complexity that
individuals seek in their
personal experiences.
High OSL consumers tend
to accept risky and novel
products more readily
than low OSL consumers.
184. Cognitive Personality Factors
• Need for cognition
– A person’s craving for enjoyment of thinking
• Visualizers versus verbalizers
– A person’s preference for information presented
visually or verbally
185. Need for Cognition (NC)
• Consumers high in NC are more likely to
respond to ads rich in product-related
information
• Consumers low in NC are more likely to be
attracted to background or peripheral aspects of
an ad
186. Visualizers vs Verbalizers
• Visualizers – consumer who prefer visual
information and products that stress the visual
• Verbalizers – conssumer who prefer written or
verbal information and peoducts,
187. From Consumer Materialism to
Compulsive Consumption
• Consumer materialism
– The extent to which a person is considered
“materialistic”
• Fixed consumption behavior
– Consumers fixated on certain products or categories
of products
• Compulsive consumption behavior
– “Addicted” or “out-of-control” consumers
188. Materialistic People
• Value acquiring and showing-off possessions
• Are particularly self-centered and selfish
• Seek lifestyles full of possessions
• Have many possessions that do not lead to
greater happiness
189. Table 5.4 Sample Items - Materialism
SUCCESS
The things I own say a lot about how well I’m doing in life.
I don’t place much emphasis on the amount of material objects people
own as a sign of success.a
I like to own things that impress people.
CENTRALITY
I enjoy spending money on things that aren’t practical.
I try to keep my life simple, as far as possessions are concerned.a
Buying things gives me a lot of pleasure.
HAPPINESS
I’d be happier if I could afford to buy more things.
I have all the things I really need to enjoy life.a
It sometimes bothers me quite a bit that I can’t afford to buy all the
things I’d like.
190. Fixated Consumption Behavior
• Consumers have
– a deep interest in a particular object or product
category
– a willingness to go to considerable lengths to secure
items in the category of interest
– the dedication of a considerable amount of
discretionary time and money to searching out the
product
• Examples: collectors, hobbyists
192. Table 5.6 Sample Items to Measure
Compulsive Buying
1. When I have money, I cannot help but spend part or the
whole of it.
2. I am often impulsive in my buying behavior.
3. As soon as I enter a shopping center, I have an
irresistible urge to go into a shop to buy something.
4. I am one of those people who often responds to direct
mail offers.
5. I have often bought a product that I did not need, while
knowing I had very little money left.
193. Consumer Ethnocentrism
• Ethnocentric consumers feel it is wrong to
purchase foreign-made products
• They can be targeted by stressing nationalistic
themes
194. Table 5.7 Sample Items from the CETSCALE
1. American people should always buy American-made products instead of
imports.
2. Only those products that are unavailable in the U.S. should be imported.
3. Buy American-made products. Keep America working.
4. Purchasing foreign-made products is un-American.
5. It is not right to purchase foreign products, because it puts Americans out
of jobs.
6. A real American should always buy American-made products.
7. We should purchase products manufactured in America instead of letting
other countries get rich off us.
8. It is always best to purchase American products.
195. Brand Personality
• Personality-like traits associated with brands
• Volvo - safety
• Perdue - freshness
• Nike - the athlete
• BMW - performance
• Levi’s 501 - dependable and rugged
197. Table 5.10 The Personality-like
Associations of Selected Colors
Commands respect,
authority
•America’s favored color
•IBM holds the title to blue
•Associated with club soda
•Men seek products packaged in blue
•Houses painted blue are avoided
•Low-calorie, skim milk
•Coffee in a blue can be perceived as “mild”
Caution, novelty,
temporary, warmth
•Eyes register it faster
•Coffee in yellow can be perceived as “weak”
•Stops traffic
•Sells a house
Secure, natural,
relaxed or easy going,
living things
•Good work environment
•Associated with vegetables and chewing gum
•Canada Dry ginger ale sales increased when it
changed sugar-free package from red to green and
white
BLUEBLUE
YELLOWYELLOW
GREENGREEN
198. Table 5.10 continued
Human, exciting, hot,
passionate, strong
•Makes food “smell” better
•Coffee in a red can be perceived as “rich”
•Women have a preference for bluish red
•Men have a preference for yellowish red
•Coca-Cola “owns” red
Powerful, affordable,
informal
•Draws attention quickly
Informal and relaxed,
masculine, nature
•Coffee in a dark-brown can was “too strong”
•Men seek products packaged in brown
Goodness, purity,
chastity, cleanliness,
delicacy, refinement,
formality
•Suggests reduced calories
•Pure and wholesome food
•Clean, bath products, feminine
Sophistication, power,
authority, mystery
•Powerful clothing
•High-tech electronics
Regal, wealthy, stately •Suggests premium price
REDRED
ORANGEORANGE
BROWNBROWN
WHITEWHITE
BLACKBLACK
SILVER,SILVER,
GOLDGOLD
200. Possessions Act as Self-Extensions
• By allowing the person to do things that
otherwise would be very difficult
• By making a person feel better
• By conferring status or rank
• By bestowing feelings of immortality
• By endowing with magical powers
201. Table 5.6 Sample Items from an Extended
Self-Survey*
My ___ holds a special place in my life.
My ___ is central to my identity.
I feel emotionally attached to my ___.
My ___ helps me narrow the gap between what I am and
try to be.
If my ___ was stolen from me I would feel as if part of
me is missing.
I would be a different person without my___.
202. Virtual Personality
• Online individuals have
an opportunity to try
on different
personalities
• Virtual personalities
may result in different
purchase behavior
203. Consumer Behavior: A Framework
John C. Mowen
Michael S. Minor
Chapter 5:
Consumer Motivation
204. Ten Key Concepts
• Concept of Motivation
• Consumer needs
• Operant conditioning
• Classical conditioning
• Vicarious learning
• Opponent-process theory
• Optimum-stimulation
level theory
• Reactance theory
• Perceived risk
• Consumer attributions
205. What is Motivation?
• Motivation refers to an activated state within a
person that leads to goal-directed behavior.
– It consists of the drives, urges, wishes, or desires
that initiate the sequence of events leading to a
behavior.
206. • Motivation begins with the presence of a stimulus that
spurs the recognition of a need.
• Need recognition occurs when a perceived discrepancy
exists between an actual and a desired state of being
– Needs can be either innate or learned.
– Needs are never fully satisfied.
– Feelings and emotions (I.e., affect) accompany needs
• Expressive needs involve desires by consumers to
fulfill social and/or aesthetic requirements.
• Utilitarian needs involve desires by consumers to solve
basic problems (e.g. filling a car’s gas tank).
207. The Structure of Emotions
• Ten Fundamental Emotions People Experience:
– Disgust Interest
– Joy Surprise
– Sadness Anger
– Fear Contempt
– Shame Guilt
208. Some General Theories of Motivation
• Maslow hierarchy: physical, safety, belongingness, ego,
and self-actualiation
• McClelland’s Theory of Learned Needs
– Achievement motivation is seeking to get ahead, to strive for success, and
to take responsibility for solving problems.
– Need for affiliation motivates people to make friends, to become
members of groups, and to associate with others.
– Need for power refers to the desire to obtain and exercise control over
others.
– Need for uniqueness refers to desires to perceive ourselves as original
and different.
209. Classical Conditioning
• A neutral stimulus, such
as a brand name, is
paired with a stimulus
that elicits a response.
• Through a repetition of
the pairing, the neutral
stimulus takes on the
ability to elicit the
response.
210. • The conditioned stimulus (CS) is a previously
neutral stimulus which is repeatedly paired with
the eliciting stimulus.
• The unconditioned stimulus (UCS) is an
eliciting stimulus.
• The conditioned response (CR) is the response
elicited by the CS.
• The unconditioned response (UCR) is the
reflexive response elicited by the unconditioned
stimulus.
212. Requirements for Effective Conditioning
• The neutral stimulus should precede in time the
appearance of the unconditioned stimulus.
• The product is paired consistently with the
unconditioned stimulus.
• Both the conditioned stimulus and the unconditioned
stimulus are highly salient to the consumer.
213. Applications of Classical Conditioning
• Applications: communications--advertising, public
relations, personal selling.
• Goal: identify powerful positive stimulus and
associate brand with it.
• Examples of powerful, emotion causing stimuli:
– beautiful, sexy people
– patriotic themes, religious symbols
– Music, beautiful scenes
– Also, negative stimuli can be associated with
competitors.
– Credit card insignia may elicit spending responses
214. Operant Conditioning . . .
. . . is the process in which the frequency of
occurrence of a bit of behavior is modified by
the consequences of the behavior.
– If positively reinforced, the likelihood of the
behavior being repeated increases.
– If punished, the likelihood of the behavior being
repeated decreases.
215. Reinforcement & Influencing
Behavior
• A reinforcer is anything that occurs after a
behavior and changes the likelihood that it will
be emitted again.
– Positive reinforcers are positive rewards that follow
immediately after a behavior occurs.
– Negative reinforcers are the removal of an aversive
stimulus.
216. Secondary reinforcers . . .
. . . are a previously neutral stimulus that
acquires reinforcing properties through its
association with a primary reinforcer.
– Over a period of time, previously neutral stimuli can
become secondary reinforcers.
– In marketing, most reinforcers are secondary (e.g. a
product performing well, a reduction in price)
217. A Punisher . . .
. . . is any stimulus whose presence after a
behavior decreases the likelihood of the
behavior reoccurring.
218. Extinction & Eliminating Behaviors
• Once an operant
response is conditioned,
it will persist as long as
it is periodically
reinforced.
• Extinction is the
disappearance of a
response due to lack of
reinforcement.
219. Schedules of Reinforcement . . .
. . . determine if a behavior is reinforced after a
certain number of repetitions or after a certain
length of time has passed.
Example. Slot machines use a variable
schedule based upon number of pulls of handle.
220. Discriminative Stimuli . . .
. . . are those stimuli that
occur in the presence of
a reinforcer and do not
occur in its absence.
Example: point of purchase display
is a discriminative stimulus.
221. Stimulus Discrimination and
Generalization
– Stimulus discrimination occurs when an organism behaves
differently depending on the presence of one of two stimuli.
Goal of differentiation is to cause stimulus discrimination.
– Stimulus generalization occurs when an organism reacts
similarly to two or more distinct stimuli. Goal of “knock-
off” brands is to use stimulus generalization.
222. Shaping Consumer Responses . . .
. . . is creating totally
new operant behaviors
by selectively
reinforcing behaviors
that successively
approximate the desired
instrumental response.
223. Vicarious Learning . . .
. . . is the phenomenon
where people observe
the actions of others to
develop “patterns of
behavior.”
224. Three important ideas:
• People are viewed as symbolic beings who
foresee the probable consequences of their
behavior.
• People learn by watching the actions of others
and the consequences of these actions (i.e.
vicarious learning).
• People have the ability to regulate their own
behavior.
225. Factors Increasing a Model’s
Effectiveness
• The model is physically attractive.
• The model is credible.
• The model is successful.
• The model is similar to the observer.
• The model is shown overcoming difficulties
and then succeeding.
226. Three Major Uses of Social-
Learning Theory
• A model’s actions can be used to create entirely
new types of behaviors
• A model can be used to decrease the likelihood
that an undesired behavior will occur
• The model can be used to facilitate the
occurrence of a previously learned behavior
227. Midrange Theories of Motivation
• Opponent-Process Theory
• Optimum Stimulation Levels
• The Desire to Maintain Behavioral Freedom
• The Motivation to Avoid Risk
• The Motivation to Attribute Causality
228. Opponent-Process Theory
. . . explains that two things occur when a person receives a
stimulus that elicits an immediate positive or negative emotional
reaction:
– The immediate positive or negative emotional reaction is
felt.
– A second emotional reaction occurs that has a feeling
opposite to that initially experienced.
– The combination of the two emotional reactions results in
the overall feeling experienced by the consumer.
– Explains addictive behaviors
– Explains priming—the effects of a small exposure to a
stimulus.
229. Optimum Stimulation Level
. . . is a person’s preferred amount of physiological
activation or arousal.
– Activation may vary from very low levels (e.g. sleep) to very
high levels (e.g. severe panic).
– Individuals are motivated to maintain an optimum level of
stimulation and will take action to correct the level when it
becomes to high or too low.
– Accounts for high vs. low sensation seeking people.
– Accounts for variety seeking
– Accounts for hedonic consumption—I.e., the need of people to
create fantasies, gain feelings through the senses, and obtain
emotional arousal.
230. The Desire to Maintain Behavioral
Freedom
• Psychological reactance is the motivational state resulting
from the response to threats to behavioral freedom.
– Two types of threats can lead to reactance:
• Social threats involve external pressure from other people to induce a
consumer to do something
• Impersonal threats are barriers that restrict the ability to buy a particular
product or service
– Frequent in marketing: e.g., pushy salesperson
– Scarcity effects: scarce products are valued more. Limited time
offer, limited supply.
231. The Motivation to Avoid Risk
– Perceived risk is a consumer’s perception of the
overall negativity of a course of action based upon
as assessment of the possible negative outcomes and
of the likelihood that these outcomes will occur.
– Perceived risk consists of two major concepts - the
negative outcomes of a decision and the probability
these outcomes will occur.
232. 7 Types of Consumer Risks.
• Financial
• Performance
• Physical
• Psychological
• Social
• Time
• Opportunity Loss
233. Factors Influencing Risk Perception
• Characteristics of the person—e.g., need for
stimulation
• Nature of the task
– Voluntary risks are perceived as less risky than
involuntary tasks.
• Characteristics of the product—price
• Salience of negative outcomes
234. Six risk-reduction strategies
– Be brand loyal and consistently
purchase the same brand.
– Buy through brand image and
purchase a quality national
brand.
– Buy through store image from a
retailer that you trust.
– Seek out information in
order to make a well
informed decision.
– Buy the most expensive
brand, which is likely to
have high quality.
– Buy the least expensive
brand in order to reduce
financial risk.
235. The Motivation to Attribute
Causality
Attribution theory describes the processes through which people
make determinations of the causality of action.
– Internal attribution is when a consumer decides that an endorser
recommended the product because he or she actually liked the
product.
– External attribution is when a consumer decides that an endorser
recommended the product because he or she was paid for
endorsing it.
236. Augmentation-Discounting Model
• Discounting occurs if external pressures exist that could
provoke someone to act in a particular way - so actions would
be expected given the circumstances.
• The augmenting principle states that when a person moves
against the forces of the environment to do something
unexpected, the belief that the action represents the person’s
actual opinions, feelings, and desires is increased.
• Fundamental Attribution error: One consistent finding is
that people are biased to make internal attributions to others.
237. Applications of attribution theory
– endorsers: seek to get consumers to perceive
internal motives for making endorsement.
– satisfaction: seek to get consumers to perceive
external reasons for product problem.
– sales promotion: find ways to avoid consumers
attributing the cause of the purchase to the sale
rather than to the excellence of the product.
238. Managerial Applications of Motivation
• Positioning/differentiation: use discriminative stimuli distinguish
one brand from another.
• Environmental analysis: identify the reinforcers and punishers that
impact consumers; identify factors that influence risk perception.
• Market research: measure motivational needs (e.g., McClelland’s
needs and need for arousal), measure risk perception.
• Marketing mix: use motivational needs to design products (e.g.,
safe cars) and to develop promotional strategy that meets needs.
Develop messages to influence consumer attributions. Use in-store
promotions to prime consumers.
• Segmentation: Segment market based upon motivational needs.
240. Perception
•The process by which an
individual selects,
organizes, and interprets
stimuli into a meaningful
and coherent picture of
the world
•How we see the world
around us
241. • People perceive things differently because of
the perceptual mechanism that differs between
people. Every person is unique in himself with
unique backgrounds, experiences, expectations,
etc, and so the resultant perceptions are also
unique.
242. • The perceptual mechanism requires greater
discussion owing to the great deal of
complexity and dynamism that goes into play.
• The three sub-processes viz., perceptual
selection, organization and interpretation
243. Elements of Perception
• Sensation
• Absolute threshold
• Differential threshold
• Subliminal perception
244. Sensation
The immediate and direct
response of the sensory
organs to stimuli.
A perfectly unchanging
environment provides
little to no sensation at all!
245. Absolute
threshold
The minimum amount of
strength or intensity that a
stimulus should possess to get
noticed is referred to as an
absolute threshold. It is the
lowest intensity at which a
stimulus can be detected i.e. in
other words, it is the lowest
level at which an individual can
experience a sensation.
246. differential
threshold
The minimum amount of
change that is required to be
brought about in a stimulus so
that the change gets noticed is
referred to as the differential
threshold. It is the minimum
level of change that is
necessary for a person to detect
that there has been a change in
the stimuli. That is why it is
also known as j.n.d. (or just
noticeable difference).
247. Marketing Applications
of the JND
• Need to determine the relevant j.n.d. for their
products
– so that negative changes are not readily discernible
to the public
– so that product improvements are very apparent to
consumers
248. • For certain changes like decrease in price or discounts,
he could keep the j.n.d. high so that it is noticeable,
and consumers are attracted towards the discounted
price; and in case of price increase, he should keep the
j.n.d. low and increase the price gradually, so that it
does not get noticed by the consumer.
• For changes like increased quantity at the same price,
he should keep the j.n.d. high again, so as to be
noticed. A new variant or a modified form, should
exhibit the “NEW” so that it is noticeable. 2
249. • In a nutshell, the j.n.d. should be used in a
manner that while positive changes (eg. reduced
price, discounts, “extra” quantity, product
improvement etc) should be noticeable to the
consumers, negative changes (eg. increased
price, reduced quantity etc.) should not be
apparent.
251. Is Subliminal Persuasion Effective?
• Extensive research has shown no evidence that
subliminal advertising can cause behavior
changes
• Some evidence that subliminal stimuli may
influence affective reactions
253. Perceptual Selection:
• Human beings are simultaneously exposed to various
stimuli in his/her environment.
• Due to the fact, that the various stimuli cannot be
treated or processed at the same time, people become
selective in their approach.
• They would choose some stimuli for further
processing.
• The choice of the stimuli would depend on what they
feel is relevant for them and or appropriate for them.
• This is referred to as perceptual selectivity.
254. • Which of the stimuli gets selected, is based on
two broad factors, viz., factors, external and
related to the stimuli, and factors internal and
related to the perceiver
External and related to the stimuli:
– These factors are those factors that exist in the
environment and are in the form of characteristic
features of the stimuli. These could take the form of
size, intensity, contrast, motion, repetition,
familiarity, novelty etc.
255. Factors that affect perceptual selectivity:
Factors external and related to the stimuli
Characteristic Example
• Size: The larger the size of the stimuli, the more likely it is to
be perceived; eg., headlines in the newspaper; brand name on
the packaging of a product.
• Intensity: The larger the force or power of a stimuli, the
greater the chances of it getting perceived;
– eg., strong smell or a loud noise; flashy colours on the
packaging or in the advertisement; strong aroma of food.
256. • Contrast : Any stimuli that stands out from the
rest of the environment is more likely to be
noticed;
– eg., capital and bold letters; a black and white
advertisement amongst coloured ads on TV; or a
coloured advertisement in the black and white
newspaper.
• Motion: Anything that moves has greater
chances of being perceived;
– eg., a scroll advertisement.
257. • Repetition: A repeated stimuli is more likely to be noticed;
– eg., advertisements in audio-visual media are more likely to be
noticed than in the print media.
• Familiarity and Novelty : A new stimuli in a familiar setting
or a familiar stimuli in a new setting increase the chances of
perceptual selectivity;
– eg., substantive variation in advertisements, where the message
content changes, while the background or the models or the jingle
remains the same; or, cosmetic variation, where the model changes,
but the message remains the same.
258. Internal and related to the perceiver:
– These factors are those factors that are related to an
individual and would differ from person to person,
viz., factors like motivation, learning, personality
and self-image, etc. Perceptual selectivity of a
person would depend upon what he considers
relevant and appropriate as per these psychological
variables.
259. • Needs and Motivation: Selection of a stimulus depends upon
our needs, wants and motivation. We would be receptive to a
stimulus which we feel is relevant for us, as based on our
needs.
– For example, if a person wants to buy a flat (safety and security
need), and he is high on the esteem need too, he would prefer looking
at advertisements for availability of flats in the posh areas of the city.
He would be receptive to such stimuli that support this need.
Similarly for people strong on need for achievement, they would be
receptive to inputs or stimuli that support their need. Thus, people
with different needs select different stimuli (i.e. items) to respond to.
The stronger the need is, the greater would be the tendency to select
related stimuli and ignore unrelated stimuli in the environment.
260. • Learning: As individuals, we learn from our
experiences, and store such learning in our
memory bank. We tend to form attitudes and
beliefs about product and service offerings, and
would be receptive to stimuli that confirm to
such attitudes and beliefs and would reject
stimuli that does not support such attitudes and
beliefs.
261. • Personality and self image: Personality and self-
image also affect perceptual selectivity. A
person would be attracted to stimuli that closely
relates to their personality and self-image.
262. • Apart from these three, other factors that could
affect selectivity of the stimulus are:
– Response disposition: it is the tendency to select a
familiar stimuli rather than one which is unfamiliar.
– Expectations: the tendency to have preconceived
notions about an input, and the resultant tendency to
select anything that supports the expectation and
vice versa.
– Past experiences
263. • For marketers, the input that they can arrive out
of this discussion on perceptual selectivity is
that they should offer different products for
different segments and position them
accordingly.
265. • Selective exposure :While people are exposed to various stimuli at the same
time, they have a tendency to seek out messages that they find pleasant, are
comfortable with, and confirm their beliefs and preconceived notions and
expectations.
• They avoid messages and block themselves from messages that they find to
be unpleasant, are discomfortable with, and are contrary to their beliefs and
expectations.
• This is called selective exposure. In other words it implies that consumers
are selective in their exposure to the various stimuli that they are exposed to,
and often block themselves from various stimuli.
– For example, a vegetarian will avoid an advertisement like “Sunday ho
ya Monday, Roz khaaye ande” from the National Egg Coordination
Committee (NECC).
266. • Selective attention: Of the many stimuli that people are exposed to,
people are attracted to those stimuli that they consider to be relevant
in terms of a match with their needs.
• They are attentive to those stimuli that match their needs and avoid
those that are irrelevant. People are also selective about the message
and the channel through which this information would be transmitted;
we could relate this to the split-brain theory, the right side processing
and the left side processing.
• Some prefer emotions in TV, others prefer logic and facts in print
media. This phenomenon of being selective towards the input based
on our needs and desires is called selective attention.
– For example, if a person intends buying a refrigerator in the
coming 2-3 months, he would en very receptive to any input that
comes his way and relates to refrigerators.
267. • Perceptual defense : Sometimes people may select stimuli which they
later find as psychologically threatening and uncomfortable.
• In such cases, they have a tendency to filter out that stimuli, although
initial exposure has taken place. The threatening stimuli is
consciously filtered away. This is called perceptual defense.
• Often people may also distort the stimuli as per their desire and give
meaning to their advantage.
– For example, a smoker is exposed to an advertisement stating the harmful effects
of cigarette smoking. As soon as such an advertisement appears, he would have a
tendency to switch to another channel, and watch something else, so that he does
not have continue with the exposure to the stimulus and subsequent processing.
268. • Perceptual blocking :When exposed to a large number of stimuli
simultaneously, people may often block the various stimuli, as they
get stressed out.
• This is because the body cannot cope up with so many stimuli at the
same time. The people thus, blocks out the various stimuli from their
conscious awareness. This is called perceptual blocking.
– For example, we all have a tendency to “mute” the TV when the channels
bombard us with so many advertisements, or to “zap” across or switch over
channels when an advertisement appears so as to avoid watching the
advertisements.
269. Perceptual Organization
• Perceptual organization deals with what
happens in the perceptual mechanism once the
information from the environment is received.
• It is a cognitive process, which is responsible
for organizing the stimuli and the surrounding
cues, to develop a “whole picture”, according to
one’s physiological, socio-cultural and
psychographic principles.
271. • Figure and ground: The figure and ground principle states that
any stimuli that stands apart from its environment, and
contrasts against is more likely to be noticed, and treated as a
unified whole.
• It would appear as a well defined figure, in the forefront,
clearly contrasted against the ground. In other words, the
figure stands clearly against the background, or in contrast to
the background, hence the term figure and ground. The
stimulus acts as the figure and gets noticed, as distinct from
the ground that gets unnoticeable.
272. • The manner in which a figure is seen as separate from the
ground and is given prominence (instead of the ground
getting prominence) depends on two kinds of factors, i.e.
factors external and related to the stimuli as well as factors
internal and related to the perceiver.
• Learning, needs and motivation, personality make up,
attitudes etc. – all of these have a role to play in the manner in
which a person decides which stimuli are to be perceived as
figure and which as ground. Both kinds of factors, related to
stimuli and to the perceiver, affect the way in which a person
organizes his perception into figure-and-ground relationship.
273. • The implication that a marketer needs to draw
from the principle is that:
– While placing their brands in a store, the packaging
should be such that the brand stands out against the
many others which should recede to the
background. Thus, the packaging design should be
chosen very carefully.
274. – While designing advertisements, it is essential that footage is
given to the product and or brand rather than the spokesperson
(model, celebrity, expert etc.).
– The marketing stimulus (for example, the product and its image as
well as the message), must be seen as the figure and not the
ground.
– The advertisements should not be so entertaining visually or
emotionally that such elements become the figure and the product
recedes to the background.
– The target audience should be able to differentiate the product
image and the message as the figure, clearly distinct from the
scenery or the model, which will be the ground. The product
should stand out as the figure and the spokesperson should recede
into the ground.
275. • Grouping: As per the grouping principle, people tend to group
together the various stimuli so that they are seen as a unified
picture or unified whole; the basis for such grouping is
– i) similarity amongst stimuli; and ii) proximity of the stimuli.
– The grouping of the discrete and distinct pieces of stimuli is done so
as to facilitate storage in memory and easy recall.
276. – Similarity amongst stimuli: The stimuli or the elements that are
similar to each other in some way are grouped together. As the
stimuli look similar to one another, people perceive them as a group
or pattern. The human mind groups similar elements into collective
entities or totalities, to extract meaning out of them. The similarity
might depend on form, color, size or any other characteristic of the
stimuli.
– For example, in an International Conference, people and their
nationalities are often identified on the dress that they are wearing; all
those dressed similarly are perceived to belong to the same country.
– In marketing terms, people rushing together to a store that announces
a discount, can be grouped together as price sensitive and deal-prone.
Or, products with a similar packaging are perceived to be the same.
This accounts for the success of “me-too” (imitation) products.
277. – Proximity of the stimuli: The stimuli or the
elements that stand close to each other in some way
are grouped together. As the stimuli stand close to
one another, people perceive them as a group or
pattern. The spartial or temporal proximity of the
stimuli activates the human mind to perceive them
as a collective entity.
– For example, people sitting with each other in a
classroom are perceived to be a friendship group.
278. • Closure: The closure principle states that in cases where an object is
identified as incomplete by sensation, our perceptual processes give it a
complete form.
• Closure is said to occur, when the human mind perceives it as a “complete
whole” although the object is incomplete and some elements are missing.
• Thus, people tend to perceive an incomplete picture as complete by
consciously or subconsciously fill in the missing pieces. They add to the
incomplete stimuli to which they are exposed according to their learning,
motives, expectation, beliefs and attitudes etc.
– For example, while reading a book, there may be a misprint, and the word or
sentence may seem incomplete. Based on the context of what has been read, and
what is to follow, we fill up the gaps, and we assign meaning to the word or to
the sentence. This is known as closure.
279. • Simplification: As the name implies, the principle of
simplification states that human beings have a tendency to
simplify things to make it more understandable. The principle
lays emphasis on the simplification of associations between
elements, for better comprehension and understanding. When
people are exposed to too much of stimuli, or information
they subtract or delete the less relevant ones and give
importance to the more important ones. This is done so that
they can lessen the load on our cognitive processes.
– For example, when exposed to too much of information on a page,
we prefer to read the portions in capital letters or in bold, as we feel
that that would be sufficient.
280. Influences of Perceptual Distortion
• Physical Appearances
• Stereotypes
• First Impressions
• Jumping to Conclusions
• Halo Effect
281. • Physical appearance:
• People often judge others (or the stimuli) on the basis of
physical appearance and looks.
– Example: Just because a car is good in looks, aesthetically designed
and appealing, does not essentially imply that it gives a good
mileage, its engine is robust and it is technically sound.
• Marketers take advantage of physical appearance as an
influencing factor to their advantage. They not only design
their cars aesthetically, in bright and vibrant colours, thus
making it look good but also design the advertisements
accordingly so as to attract the buyers.
282. • Another example: Marketers use attractive models as their
spokesperson. Attractive models are regarded to be more
persuasive than average looking models, as people relate the
good looks of the models with pleasurable outcomes after
usage of the product.
• -Another error that relates to physical appearances is when we
associate person “X” and his qualities to person “Y”, because
person “X” resembles person “Y.”
• Example: The very fact that a “me-too” product resembles an
original product does not imply that the former would
function as well as the latter.
283. • Stereotypes:
• People judge another person (or the stimuli) on the
basis of the characteristics of the group to which he
belongs. It is a tendency to perceive another as
belonging to the same group or category as the former.
However, in reality, each individual is different and
unique.
• People have a tendency to generalize; they create
expectations of what a stimulus (person, object, thing
etc.) would be like on the basis of the group to which
Notas do Editor
General Theories
Maslow Heirarchy of Needs
McClelland’s theory of learned needs
They will use personality traits
Regardless of theoretical arguments most people use personality to categorize , define, and explain other people.
We all tend to have the same general definition of the meaning or behaviors associated with each trait. Most traits are consistent with each other
Our assessment of one’s personality is based on experience and can be different for other people.
