This document provides an overview of key concepts in consumer behavior taught in an introductory consumer behavior course. It discusses definitions of consumer behavior and different consumer orientations throughout history. The marketing concept is explained as well as how marketers segment, target, and position products. The document also covers customer value, satisfaction, trust and retention. It provides examples of how companies like Starbucks create value propositions and how McDonald's communicates value to consumers. The impact of digital technologies and social media on marketing is examined. A simple model of the consumer decision making process is also presented.

1. CHAPTER 1
Introduction to
Consumer Behavior
By: Marc Wachtfogel Ph.D.

2. Are You…
By: Martin Lindstrom 2

3. Times Square – The Greatest Advertising Show on Earth
3

4. Studios & Media Companies
http://sploid.gizmodo.com 4

5. 5
TV Channels
http://sploid.gizmodo.com

6. 6
Consumer Goods
http://sploid.gizmodo.com

7. Supermarket Psychology - Purpose by Design
7

8. Supermarket Psychology
Entrances, Layout and Shelving
8
https://www.youtube.com/watch?v=RjgkQ6bq7aE

9. Supermarket Psychology:
Specials, pricing, labeling and packaging
9
https://www.youtube.com/watch?v=yzRDEKyqIJs

10. Learning Objectives
1. To Understand What Consumer Behavior Is and the Different Types of
Consumers.
2. To Understand the Relationship Between Consumer Behavior and the
Marketing Concept, the Societal Marketing Concept, as well as
Segmentation, Targeting, and Positioning.
3. To Understand the Relationship Between Consumer Behavior and
Customer Value, Satisfaction, Trust, and Retention.
4. To Understand How Marketers are Increasingly Able to Reach
Consumers via Social Media and Better Satisfy the Needs and Wants of
Consumers.
5. To Understand the Makeup and Composition of a Model of Consumer
Behavior.
10 Copyright 2010 Pearson Education, Inc. publishing as Prentice Hall

11. Definition
• Consumer Behavior includes all the he behavior that consumers display
in searching for, purchasing, using, evaluating, and disposing of products
and services that they expect will satisfy their needs.
• The what, why, when, where, and how of consumer purchases are
examined in consumer behavior.
• It is not just individuals, but households, families, and groups that
influence the decisions we make.
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12. To Which Segment of
Consumers Will This Ad Appeal?
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13. A Segment of Consumers Who are Environmentally
Concerned
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14. What are the personal (age, lifecycle), psychological (motivation,
perception), social (group influences) and cultural messages (values,
perceptions, beliefs) of these products?
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15. Two Consumer Entities
15
We will be focus on the personal consumer.

16. Development of the
Marketing Concept
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The marketing concept was developed over time through two other important
business orientations called the production and the sales orientation.

17. Production Orientation
• From the 1850s to the late 1920s
• Companies wanted efficient production lines to mass produce products.
• Consumer demand exceeded supply - Consumers were content to get a
product and were not focused on product variation.
• Control was in the hands of the producers who said, “if we make it they
will buy it.”
17

18. Sales Orientation
• From the 1930s to the mid 1950s
• Excess product leads to focus on selling
• Supply exceeded customer demand
• Products were still similar and there was little variation
Chapter One Slide 18

19. Marketing Concept
- Customer is First -
• 1950s to current - Focus on the customer!
• Rather than focus on what can be manufactured, the focus shifts with the
marketing concept to what consumers prefer.
• Determine the needs and wants of specific target markets
• Deliver satisfaction better than competition – Data Mining Everywhere
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20. 10 Emotional Triggers
1. Fear: Fear is an emotion that can be used in a wide variety of marketing
messages. Insurance companies often appeal to the emotion of fear with
messages like "Don't get caught with too little insurance.”
2. Guilt: Consumers are easily affected by messages that trigger emotions of
guilt. Nonprofit organizations use the guilt trigger effectively in copy such
as "Don't let them suffer anymore.“
3. Trust: Trust is one of the hottest trends in marketing, and every company
seems to be trying to jump on the trust bandwagon in their marketing
messages. Financial companies are leading the way with messages like "no
hidden fees.“
4. Value: Value is another hot trend in marketing, and many promotions
appeal directly to the emotional trigger of getting a good deal. "If you find
a better price for the same product, we'll match it“
5. Belonging: Few people truly want to be alone. Human nature dictates that
most people want to feel like they belong to a group, and customers often
purchase products in an attempt to feel part of a specific group. Many
companies effectively appeal to consumers' desires to belong, using copy
like "You're part of the family."

21. 10 Emotional Triggers (cont.)
6. Competition: The old adage of keeping up with the Joneses is an adage for a reason
Copy like "Make them drool" is a great example.
7. Instant Gratification: Messages that cater to a sense of urgency. Use words like
now, today, in one hour or less, within 24 hours, and so on to appeal to the
emotional trigger of instant gratification.
8. Leadership: A lot of consumers want to lead the way. Phrases such as "Be the first
on your block" effectively appeal to the emotional trigger of leadership.
9. Trend-setting: Many consumers want to feel cool or trendy…"all the cool kids are
doing it“ "Be like Mike" .
10. Time: In the 21st century, people are busier than ever. As such, they desire more
free time to pursue personal interests, spend time with family and friends, and so
on. "Cut the time it takes to vacuum your house in half."

22. Discussion Questions
1. What two companies do you believe grasp
and use the marketing concept?
2. These companies may focus on the following:
• They develop a wide variety of products to
meet very different needs.
• They realize the importance of
communicating with their consumer and
explaining their product benefits.
• They practice corporate social
responsibility through tie-ins with charities
and fundraising.
22

23. Societal Marketing Concept
• The societal marketing concept
was developed from the marketing
concept.
• The image in this slide of a Siemens
ad suggests the company is
committed to developing products
that are safe for customers and the
environment.
• Marketers and consumers are
increasingly taking stock of what is
good for themselves, their family,
their country, and the planet.
• Good corporate citizenship
23

24. Embracing the Marketing Concept
1. Consumer Research
2. Segmentation
3. Market Targeting
4. Positioning
1. The process and tools used to study
consumer behavior
2. Process of dividing the market into
subsets of consumers with common
needs or characteristics
3. The selection of one or more of the
segments identified to pursue – Target
Market
4. Developing a distinct image for the
product in the mind of the consumer
• Successful positioning includes:
– Communicating the benefits of the product
– Communicating a unique selling proposition
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All companies must continually conduct research to understand the needs and
priorities of their market segments.

25. The Marketing Mix
The 4 P’s
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Includes the name, design, and
features
Includes the list price, discounts, and
payment methods
How a company will distribute their
product
How the company will let customers know
about the product and its benefits

26. Customer Value, Satisfaction, Trust, and Retention
26

27. Successful Relationships
Value, Satisfaction, Trust, and Retention
1. Customer Value
2. Customer
Satisfaction
3. Customer Trust
4. Customer Retention
1. Defined as the ratio between the customer’s
perceived benefits and the resources used
to obtain those benefits
– Perceived value is relative and subjective
– Developing a value proposition is critical
1. The individual's perception of the
performance of the product or service in
relation to his or her expectations.
2. Trust is the foundation for maintaining a
long-standing relationship with customers.
3. The objective of providing value is to retain
highly satisfied customers.
• Loyal customers are key
– They buy more products
– They are less price sensitive
– Servicing them is cheaper
– They spread positive word of mouth
27

28. Starbucks Value Proposition
1. To create an “experience” around the consumption of
coffee, an experience that people would weave into their
lives.
2. To create an uplifting experience in customer intimacy
3. To create an “ambiance” based on human spirit, a sense of
community and the need for people to come together.
Mission: to inspire and nurture the human spirit – one person,
one cup and one neighborhood at a time.
Brand Image - Anywhere, everywhere, good coffee on the run.
28

29. Customer Perspective
From 4 P’s to 4 C’s of Marketing
29

30. Discussion
• How does McDonald’s create value
for the consumer?
• How do they communicate this
value?
1. They create bundled meals and dollar menus to create value for price-conscious
consumers. In addition, they create value to the health-conscious consumer by offering
salads, fruit, and healthy options for Happy Meals.
2. They communicate this value through television ads, in-store signage, and their website.
30

31. http://www.ted.com/talks/tony_robbins_asks_why_we_do_what_w
e_do
31

32. Impact of Digital Technologies
32

33. https://www.youtube.com/watch?v=iTUUWOV4Vns
33
The Best Marketing Campaign…EVER!!!

34. The reason for the amazing success of this campaign was not
what they were marketing, but how they used social media to
do it.
There are some lessons anyone trying to promote a product or service could use.
1. Make it believable. Many marketing groups would never make a claim if they can't provide
substantial evidence. How might Tourism Queensland prove that their job is the best in the
world? They can't. But it is believable because it is a beautiful place and fits what many
people's definition of a dream job might be.
2. It's not about how much you spend. One of the major benefits of smart public relations and
social media is that it scales in a way that advertising typically doesn't.
3. Focus on content, not traffic. The typical marketing campaign focuses on traffic to some kind
of site. For Tourism Queensland, the biggest payoff of this campaign was having over 34,000
videos on YouTube from people around the world talking about how much they love
Queensland.
4. Create an inherent reason for people to share. Another element of this campaign that
worked extremely well was the fact that there was voting enabled on the videos.
5. Give your promotion a shelf life. The best thing about this campaign may just be the content
yet to come. Ben, the winner, just started blogging and sharing videos and photos, but the
content is already engaging, high quality and inspires you to dream of making it to
Queensland yourself. Over the next six months, his itinerary will take him across the state of
Queensland and unlock many other unique opportunities. Best of all, this content will live on
far beyond the time span of the campaign. Source: fastcompany.com 34

35. Consumer Behavior Is Interdisciplinary
35

36. A Simple Model of Consumer Decision Making
36
The input stage includes
sources of information to
the consumer – how they
learn and are influenced by
the marketer and their
environment.
The Process moves from
the inputs to the
psychological factors
involved in recognizing a
need, searching for
information, and evaluating
alternatives.
Post-purchase evaluation
ties to the satisfaction
topics discussed earlier and
the importance of customer
loyalty to marketing’s
profitability.

37. REALITY - EVOLVING
37

38. NeoReader
• See a great pair of shoes in a
magazine and want to find the
nearest location to buy them?
• Want details of a product you
may want to buy?
• See a movie ad or poster and
want to view the trailer?
• Create your own code. Put a code
on your business card that links
to your website. How about a t-shirt
or tattoo?
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39. Convergence & New Ways to Pay
Is it the end of credit cards?
39