1. Consumer behavior
The overview of buying process

2. Why to study consumers behavior?
The study of consumers helps firms and
organizations improve their marketing
strategies by understanding issues such as
how:
1) The psychology of how consumers
think, feel, reason, and select between
different alternatives
(e.g., brands, products, and retailers);

3. 2) The behavior of consumers while shopping
or making other marketing decisions;
3) The psychology of how the consumer is
influenced by his or her environment (e.g.,
culture, family, signs, media);

4. Definitions
• Customer behavior:
1) a broad term that covers both individual
consumers who buy goods and services for
their own use and organizational buyers who
purchase business products
2) the process through which the ultimate
buyer makes purchase decisions

5. Consumer behavior involves the use and
disposal of products as well as the study of
how they are purchased. Since many
environmental problems result from product
disposal (e.g., motor oil being sent into
sewage systems to save the recycling fee, or
garbage piling up at landfills) this is also an
area of interest.

6. The impact of consumer behavior on society is
also of relevance. For example, aggressive
marketing of high fat foods, or aggressive
marketing of easy credit, may have serious
repercussions for the national health and
economy.

7. Fast-Moving Consumer Goods
(FMCG’s)
These are high volume, low unit value but
with fast purchase e.g. ready
meals, newspapers, soap, and cooking oil

8. Consumer Durables
These have low volume but high unit value
e.g. cars, fridges/freezers, cookers, television
sets, washing machines, computers etc.

9. Soft Goods
These are similar to consumer durables except
that they wear out more quickly and therefore
have shorter replacement cycle e.g.
clothes, shoes etc.

10. Characteristics Affecting Consumer
Behavior
1. Cultural Factors
2. Social Factors
3. Personal Factors
4. Psychological Factors
5. Situational Factors

11. 1. Cultural Factors
• Culture – Culture is the fundamental
determinant of a person’s wants and
behaviour. The growing child acquires a set of
values, perceptions, preferences and the
behaviour through his or her family and other
key institutions.

12. Culture
• Culture is often the most powerful cause of a
person's needs, wants and behavior.
• Characteristics of Culture
– Culture is learned.
– Certain aspects of culture never change.
– Cultural shifts create opportunities.
– Subcultures can be of even greater interest to
marketers than cultures.

13. A child grown in USA is exposed to the
following values: achievements and success,
efficiency and practicality, progress, material
comfort, individualism, freedom and
youthfulness. What about a child grown in
Ghana? In Ukraine?

14. Subculture
Each culture consists of smaller group
(subculture) of people with shared value systems
based on common life experiences and
situations. These subcultures can be ethnic,
religious, racial or regional groups as well as
those that form around music groups. Nestle Gh
Ltd (MaggieHomowoCooking contest) Guinness &
MTN have been exploiting our festivals to
promote and build their brands and Corporate
Image.

15. Social Class
Social classes reflect not only income but also
other indicators such as occupation, area of
residence, education, and wealth. Social
classes show distinct product and brand
preferences in many areas, including clothing,
home furnishing, leisure activities,
automobiles, and media consumption

16. 2. Social Factors
Group Membership: Anyone knows that
people act differently in groups than they do
on their own. Since many of the things we buy
are consumed in the presence of
others, group behaviours are important to
marketers

17. Social Factors
• Groups:
– Reference Groups
– Aspirational Groups
– Dissociative Groups
• Opinion Leaders
• Family
• Roles and Status

18. The Family
This is probably the most important consumer
buying organization in society. Family
members constitute the most influential
primary reference group. Marketers are
interested in the roles and relative influence
of the husband, wife, and children in the
purchase of a large variety of products and
services.

19. Toyota caters to family buying influences.

20. 3. Personal Factors
• Age and Life-Cycle Stage
– Tastes and preferences change over time.
• Occupation
– Occupation influences the purchase of clothing, cars, memberships, etc.
• Economic Situation
– Income-sensitive goods
– Counter-cyclical goods

21. 4. Psychological Factors
Psychology helps marketers understand the
‘why” and “how” of consumer behavior. In the
psychological situation, consumer buying
behavior is influenced by four factors
including:
Motivation, Perception, Learning, and Beliefs
& Attitudes.

22. Motivation
Motivation is an inner state that
energizes, activates, moves or channels
behavior towards certain goals (Assael).
Motivation arises from perceived needs. These
can be grouped into biogenic (e.g.
thirst, hunger, discomfort) and psychogenic ne
eds (arise from psychological state of tension
such as esteem, belongingness).

23. Perception
A motivated person is ready to act. How the
motivated person actually acts is influenced
by his or her perception of the situation.
Perception is the process by which an
individual selects, organizes, and interprets
information inputs to create a meaningful
image of a situation.

24. Beliefs & Attitudes
• Lifestyle (determines how people choose to spend
their time, money, and energy and that reflects
their values, tastes, and preferences Consumers
often choose goods, services and activities that are
associated with a certain lifestyle.)
• Personality (The idea is that brands also have
personalities, and that consumers are likely to
choose brands whose personality matches their
own. )
• Self-Concept (an individual’s self-image that is
composed of a mixture of
beliefs, observations, and feelings about personal
attributes. Self-image is how a person thinks of
himself or he thinks others think of him.)

25. 5. Situational Factors
• The Physical Environment:
Marketers are aware that factors such as
decor, smells, lighting, music, crowding, and
even temperature can significantly influence
many purchases. Many retailers are focusing on
adequate packing, cyber-hangout and in-store
display to influence the consumer decision-
making process.

26. 4) How marketers can adapt and improve their
marketing campaigns and marketing strategies
to more effectively reach the consumer.

27. Generating Beliefs Through Advertising
• Statements must be
– Perceived
– Comprehended
– Remembered
– Believed (at least in part)

35. Product Personality Issues
• Gender
– Often used for brand personalities
– Some product perceived as masculine (coffee and
toothpaste) while others as feminine (bath soap and
shampoo)
• Geography
– Actual locations like Philadelphia cream cheese and
Arizona iced tea
– Fictitious names also used such as Hidden Valley and Bear
Creek
• Color
– Color combinations in packaging and products denotes
personality

36. Marketers often use a fictitious
location to help with personality.

38. • Caution, novelty, temporary, warmth
• Eyes register it faster
• Coffee in yellow can perceived as “weak”
• Stops traffic
• Sells a house

39. • 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

40. • Human, exciting, hot, passionate, strong
• Makes food “smell” better
• Coffee in a red can perceived as “rich”
• Women have a preference for bluish red
• Men have a preference for yellowish red
• Coca-Cola “owns” red

41. • Goodness, purity, chastity, cleanliness, delicac
y, refinement, formality
• Suggests reduced calories
• Pure and wholesome food
• Clean, bath products, feminine

42. • Sophistication, power, authority, mystery
• Powerful clothing
• High-tech electronics
• Regal, wealthy, stately
• Suggests premium price

43. Positioning Through Creating Beliefs
• “It’s not delivery; it’s De Journo!”
• “Wal-Mart. Always low prices.
Always.”
• “I just saved a bunch of money on
my auto insurance.”
• “U-um Good!” (Campbell’s Soup)

44. Consumer Research Methods
Market research is often needed to
ensure that we produce what
customers really want and not what
we think they want.

45. There are two main approaches to marketing:
1) Primary research;
2) Secondary research.

46. 1. Primary research
Primary research is research that you design
and conduct yourself. For example, you may
need to find out whether consumers would
prefer that your soft drinks be sweater or
tarter.

47. 1. Secondary research
Secondary research involves using
information that others have already put
together. For example, if you are thinking
about starting a business making clothes for
tall people, you don’t need to question people
about how tall they are to find out how many
tall people exist—that information has already
been published

48. The Buyer Decision Process

49. Need Recognition
Buyers recognize a
need or problem as a
result of internal or
external stimuli.
Marketing communications often stimulate
need recognition.

50. Triggering Need Recognition
Hungry yet?

51. Information Search
• High vs. Low
Involvement Purchases
• Cost vs. Benefit Model
• “Big-Ticket” Anomolies
• Cognitive Economy
edmunds.com

52. Information Sources
– Personal – Public
• Family, friends, neighbors, an • Mass media articles or news
d casual or work programs, Internet searches,
acquaintances consumer rating organizations
– Commercial – Experiential
• Advertising, salespeople, dea • Using, handling, examining or
lers, Web sampling the product
sites, packaging, and displays
Which source is most influential?

53. Evaluation of Alternatives
• ELM: Central vs. Peripheral Route processing
• Some Types of Evaluation Calculus:
– Compensatory vs. Non-compensatory
– Weighted Tally Processes
– Elimination-by-aspects
– Lexicographic
– “Checkbox Choice”
– Affect Referral

54. Purchase Decision
• Intentions to purchase are sometimes
interrupted.
• Potential “Interrupters”:
– Attitudes & influences of others
– Unexpected situational
factors
– Buyer’s Remorse
– Speed of decision

55. Postpurchase Behavior
• Consumer satisfaction/dissatisfaction results from gaps
between expectations and perceived performance.
– Performance BELOW Expectations → Disappointment
– Performance EQUALS Expectations → Satisfaction
– Performance GREATER than Expectations → Delight
– Performance MUCH GREATER than Expectations →
Expectation Recalibration

56. Cognitive Dissonance
• Cognitive Dissonance: “Did I make the right
purchase? Should I have bought this?”
• Minimize dissonance by:
– Offering mechanisms for making complaints
(Customer Service, 800 hotlines, e-mail, etc.)
– Being responsive to problems and questions
– Advertising (remind consumer why choice made sense)
– Minimizing the potential for product misuse (good product
instructions) and “Poke-Yoke”.

57. Product Adopter Categories
Not everyone adopts at the same pace.
• Innovators: venturesome, try new ideas at some
risk.
• Early adopters: opinion leaders who adopt new ideas
early, but carefully.
• Early majority: deliberate adopters, who adopt
before the average person.
• Late majority: skeptical, adopt only after the majority
of people have tried a product.
• Laggards: last to adopt, tradition bound, and
skeptical of change.

58. Adopter Categorization Distribution

59. In-Class Activity – WHY WE BUY
Choose a product, product line, brand, or company and answer the following:
• What are the obvious (i.e. more superficial) reasons why consumers buy
these products?
• What are the not-so-obvious, more deep-seated reasons/motivations why
consumers buy these products?
• What are the obvious (i.e. more superficial) reasons why consumers do
not buy these products?
• What are the not-so-obvious, more deep-seated reasons/motivations why
consumers do not buy these products?
• Choose one or more of the above reasons/motivations to buy or not buy
and provide an appropriate implication for Marketing strategy.