Consumer Behavior Ch6 Presentation

8/8/2019 Consumer Behavior Ch6 Presentation

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ANALYZING CONSUMER MARKETS ANDANALYZING CONSUMER MARKETS ANDBUYING BEHAVIORBUYING BEHAVIOR

Knowing customers are never simple.Knowing customers are never simple.

They state their needs and wants, in one directionThey state their needs and wants, in one directionand act otherwiseand act otherwise..

Model of Consumer BehaviorModel of Consumer Behavior

7 Os Frame work7 Os Frame work Whenever marketing manager cannot excess theWhenever marketing manager cannot excess the

consumer, it has to rely onconsumer, it has to rely on

7 Os framework7 Os framework for consumer researchfor consumer research..


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Who constitutes the market?Who constitutes the market?

OccupantsOccupantsWhat does the market buy?What does the market buy?

ObjectsObjectsWhy does the market buy?Why does the market buy?

ObjectivesObjectivesWho participates in buying?Who participates in buying?

OrganizationsOrganizationsHow does the market buy?How does the market buy?

OperationsOperationsWhen does the market buy?When does the market buy?

OccasionsOccasionsWhere does the market buy?Where does the market buy?

OutletsOutlets

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Questions regularly asked:Questions regularly asked:


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CultureCultureCulture is a most fundamentalCulture is a most fundamentaldeterminant of persons wants anddeterminant of persons wants andbehavior.behavior.e.g. growing child acquires some value,e.g. growing child acquires some value,and perceptions from its surroundingand perceptions from its surrounding(family+ institution and culture)(family+ institution and culture)Culture isCulture is pp transferable (generation)transferable (generation)

pp NurturedNurturedpp Explicit and implicit from theExplicit and implicit from the

behaviorbehaviorpp Change is difficult but notChange is difficult but not

impossible.impossible.

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Factors influencing buying behavior:Factors influencing buying behavior:


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SubcultureSubcultureThey are for more specific identificationThey are for more specific identificationand socialization.and socialization.

e.g. nationalities, religious etc.e.g. nationalities, religious etc. MuslimMuslimculture Pakistan Indonesia Malaysiaculture Pakistan Indonesia Malaysia

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Factors influencing buying behavior:Factors influencing buying behavior:

Pakistan Indonesia Malaysia

Muslim Culture


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Social classSocial classEarlier we have studied 6 classesEarlier we have studied 6 classes

divisions.divisions.7 classes division on (page176). Table7 classes division on (page176). Table-- 6.16.1with addition of working class.with addition of working class.Division is done on the basis of similarDivision is done on the basis of similar

values, interests and behavior other thanvalues, interests and behavior other thanincome level. (For consumers)income level. (For consumers)Characteristics of Social classesCharacteristics of Social classesa. Each division behaves more alike.a. Each division behaves more alike.

b. Persons are in inferior or superiorb. Persons are in inferior or superiorposition according to their position inposition according to their position insocial class.social class.

c. Movement from one class to another isc. Movement from one class to another is

possible.possible.

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d. There are many variables on whichd. There are many variables on whichthey depend; income, education,they depend; income, education,occupation, wealth etc.occupation, wealth etc.

..2. Social factors:Consumer behavior is also influenced by social

factors.e.g. family, reference groups.Reference Groups:That group, which has a direct or indirect influence

on behavior of consumer.One is direct influence group:


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Membership Group

Primary Group:Family, Friends, Neighbors,Co-workers(More interaction)

Secondary Groups:Religious groups, Religions,Professionals trade union groups.(Less interaction)

Consumer behavior is influential in three ways.Reference p New behavior and life styles.

pAttitudes and self-concept.p Pressures, which will affect the personal

decisions.


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a. Group to which a person wants to associatehimself is anspirational groups.

e.g. cricket team, Pepsi---- in brands. Aerial/ Surf.b. Dissociative groups, is one whose values or

behavior individual reject.

Opinion Leaders:It is a person offers, advice and information about abest product

Which one is the best productOr how to use productBenefits ofproduct.


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Family:Family members constitute the most influential

primary reference group.Family ofOrientations

e.g. from parents a person acquire orientationtoward religion, politics and economies etc.Family ofProcreation

e.g. Spouse and Children.

Roles and Status

Person participates with many group throughout his lifeE.g. family, clubs, organizations etc.

He has a different role and statues in each positionassociated.


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Role: Consists ofactivities that a person isexpected to perform.

Status: (position, where consumer works)Each role carries a status.(Status Symbols)

Personal Factors: Age and stage in the life cycle. Occupation Economic Circumstances Life styles Personality Self-Concept


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Age and Stage in Life Cycle:With the age buying habits change.

e.g. baby food, than normal food, special food.Age is related with, selection of clothes, furniture,recreation etc.

Stage refers to psychological life cycle stages.e.g. Divorce, marriage.

Occupation:According to occupation goods are preferred bycustomers.Like engineers use; Auto CAD.(Computer programs)Artists/ Architects use; Correl Draw.(Computerprograms)Also work environments effect the consumerpreference greatly.


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Economic Circumstances:

Greatly affect the buying conditions specially,savings and monthly income.

And spending attitude.Life Style:

Depicts persons activities, interests andopinions.

Lifestyle portrays the whole personinteracting with his or her environment.

e.g. students, teachers, business executives,marketers, bankers.


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Personality and Self- Concept:Personality means a persons distinguished,

psychological characteristics, which willlead to relatively constant responses.

Self-Concept:How a person views himself, actual self-concept,and ideal self-concept.Others Self Concept:How she thinks others see others.

4. Psychological factors: Motivation Perception Learning

Beliefand attitudes


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Motivation:A person may have needs, some needs are

biogenic and some are psychogenesis. Biogenic needsThey arise from physiological states of

tension such as hunger, thirst, anddiscomfort.

Psychogenic needsThey arise from psychological state of

tension, such as need of recognition,esteem, or belonging.

Need becomes a motive when it reaches a sufficientlevel of intensity.

Motive is a need that sufficiently pressing to drive the

person to act.


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Conclusion:Actually need, when reaches a certain level, it

motivates a person to act.There are 3 theories in this regard:1. Sigmund Freud: (Theory of motivation)He says that real forces shaping the persons

behavior or for the motivation of a person islargely unconscious.

[Thus a person cannot fully understand his/her motivations] id, Super Ego, Ego.

e.g. each product is capable of satisfyingunique set of motives.

Like Burger at Mc Donalds is fun, Socialrelaxation, status.


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Motivational positioning: (Jan Callebaut)Manufacturer will place a product in a way,

seeing the motives of the people, andspecialized in one motive (where needs arestrong and people are ready to act).

2. Maslow Theory Of motivation: (Abraham

Maslow)He says that human needs are arranged in

hierarchy. (From most pressing to leastpressing)

Manufacturers try to concentrate on type ofmotive, in a particular area to satisfy theirneeds.

3. Fredrick Herzberg: (two factor theory of

motivation)


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Satisfier & Dis-satisfier

Factors that causesatisfaction

Factors that causesatisfaction


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Two implications of this theoryFirst:

Seller will try to avoid dis-satisfiers i.e.poor service policy, poor delivery.

Second: Seller should identify the major

satisfiers or motivators and then try todeliver it.

Perception:A motivated person is ready to act, is influenced by

his perception.Perception is a process in which input information, isselected, organized and interpreted to create ameaningful picture of the world.


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Perception depends upon:I

ndividual natureSurroundings (brought up)Condition of individual

(happy, sad)

Different people perceive things differently,because;Selective attentionSelective distortion

Selective retention


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Selective Attention:People are exposed to a number of stimuli daily

(Adds) but they are attracted towards some of them(rest are screened out).This selection/ screening depends on:p People are more likely to notice stimuli that need

to a current need. (Computers).p People are more likely to notice stimuli that theyanticipate. (New technologies).

p People are more likely to notice stimuli, whosedimensions are large in relation to the normal size ofstimuli. (Discount on computers $100- attraction will bethere as compared to an offer of$5 discount).


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Selective distortion:It is a tendency to twist information in way to support

persons perceptions.Ads do not sometimes, means what people interpret. (NikeJust do it)Manufacturer cannot do any thing but to be careful inmaking ads.Selective Retention:People will forget much of the information but will tend toretain information that supports their attitudes and beliefs.Learning:It involves changes in an individuals behavior arising fromexperience.p Human behavior is mostly learned.Learning is produced through inter play of;


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DriveStimuliResponses

Reinforcement p generalization (+ve)p Discrimination (-ve)

Drive: is a strong internal stimulus impelling action.(Linda brown has a drive toward self-actualization)Stimuli: Computer (reward)

Cues: are minor actions [stimuli (surroundings)],which help in decision.e.g. (Linda brown, seeing friends computers, officecomputers)

Reinforcement:Generalization: (+ve Reinforcement)If reward is good person generalizes.e.g. if you use IBM computer, you will go for IBM copiers,

printers etc.


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Discrimination: (-ve Reinforcement)

If reward is not good you will go for other brand.

p Theorists suggests that demand for productlearning can be created by associating it with strongdrives, motivating cues and providing positivereinforcement.Beliefs and Attitudes:

Belief is a descriptive thought that a person holdsabout something.Is important in products likeOrigin of product

Country reputation in product (Japanesetechnology)Country image (American PEPSI), (Made in Japan)Attitude/ response towards countries. (Israelifirms)


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Attitude is persons enduring favorable or un-

favorable evaluations, emotional feelings and action

tendencies toward some object or idea.Attitude lead people to behave in a similar waytoward the same object.Attitude put a person into a frame of mind of likingor dis-liking toward a product.People have attitude toward every thing. (politics,clothes, music, religion)Attitude is sort of a permanent behavior and tochange that many other attitudes mostly need

adjustments.Buying Process:How buying process actually takes place?Buying roles:Initiator: A person who first suggest the ideas of

buying.


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Influencer: A person whose views and advices influencethe decision.

Decider: What to buy, where to buy, how to buy,

whether to buy or not?Buyer: A person who makes an actual purchase.User: Real user of the product.Buying behavior:Buying behavior for different products are different.

Assael give 4 types of buying behavior on the degree ofinvolvement of buyer and degree of difference amongbrands.

Complex Buying Behavior:Usually for those products

Which are expensiveBrought infrequentlyRiskyAnd highly self expressive [priority of brand or

differentiation]


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Consumers are involved in complex buying behaviorwhen they are highly involved in a purchase, and are

aware of significant difference among brands e.g. Airbus, Plaza.1st. Belief2nd. Attitude3rd. Purchase.

Manufacturer must introduce the strategy in whichhe can promote those features of product, which willdifferentiate the brand prominently.

Dissonance Reducing Behavior:Highly involved consumerBut no/ little difference in brands.High involvement refers to the fact that purchase is

expensive, infrequent, and risky.


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As there is little brand difference, so consumer willbuy those products, which are less in price or

conveniently available e.g. carpet.1st. Purchase2nd. New belief3rd. Attitudes.After the purchase consumer develop dissonance. If

someone says some good things about some otherbrand or say nasty things about the purchasedproduct.

Habitual Buying Behavior:Low consumer involvementAbsence of brand differencee.g. salt, pencil.If consumer buys the same brand of salt again and

again, it is a habit not brand loyalty.


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One reason of low involvement is less cost.Low involvement becauseCustomer does not care for product.Do not look for information about it.Do not waste time in making belief.Instead Ad repetition will cause in this case brand

familiarity.1st. Belief formed by brand familiarity2nd. Purchase3rd. No evaluation (because they dont care)For Low Involvement Product:

T.V is a good advertising media.As simple and short message is to be delivered.It will gain attention if imagery or design with some

attractive features are displayed.


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Manufacturer should concentrate on price cuts and

promotion for low involvement products.Four strategies by which low involvement can be

converted into high involvement.Linking of product to some involving issue e.g.

toothpaste to cavity.Linking product with situation e.g. coffee in morning

situation, cold drink when somebody is thirsty.Linking product with personal values or ego e.g. PAFAdding an important product feature e.g. plain drink

with Vitamins, powdered milk with Calcium.They promote the product from low involvement to

moderate involvement only.


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Variety seeking Behavior:Low consumer involvementMuch brand difference.These are products in which consumers do brand

switching.e.g. cookies, toffees. (Just for change of taste).Leader Firms in this type will try to provide more stock

in the market;Not leaving any shelf spaceRepeated advertisingChallenger firmsTry to innovate productsNew featuresPrice cutsFree SamplesCouponsp

To make a difference in the market.


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Stages of Buying Behavior Process:Smart companies research the buying decision

processMarketers can use many methods to know the stages

of buying decision.1. Introspective method:They can think about how they themselves would act.

2. Retrospective method:By interviewing small no. of recent purchasers asking

them to recall the events involved in purchase.3. Prospective method:Locate consumer who plan to buy the product and ask

them how they decided to buy.4. Prescriptive method:Consumers are asked to tell the ideal way, to buy the

product.


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Stages

Information Search

Evaluation of Alternatives

Post Purchase Behavior

Purchase Decision

Problem Recognition


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1. Problem recognition:Buying process starts when the buyer recognizes a

problem or a need.Need is aroused by an internal or external stimuli.e.g. you see food, you feel hungry.You see a new car, you want to buy it.Important step, also used in research process, need

is to be correctively traced out, converted intomotive. (Threshold level)2. Information search:Aroused consumers will look for more information.Two levels

One: The mild research stage is called hyperattention.

(Linda brown pays more attention to computer Ads)Two: Active information search.(Linda brown) she will particularly make an effort to

find information about computers.


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There are four sources where information can be found.Personal source (Family, friends, neighbors)Commercial sources (Adv, Sales persons, dealers,

packaging)Public sources (Media, Consumer rating organization)Experimental sources (Handling, examining, using

product)Most information comes from commercial sources,

(Marketer dominated source)Effective information from personal source.Commercial information performs informing function.Personal source perform evaluation function.

3. Evaluation of Alternatives:Rating of attributes of product is done.In evaluation process:Type of needBenefits of productAttributes of product are important.


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Consumer evaluation is difficult to interpret because theyhave their own brand beliefs.

(i.e. where each brand stands on its attributes) and the setof beliefs about a brand makeup brand image.

There are some strategies, which will stimulate buyingprocess of consumer towards any brand.

I. Modification:Technique is known as real positioningAdding attributesFeaturesII. Alter Belief about the Brand:

Standing of the brand in customer eyes.This is known as psychological repositioning.III. Alter Beliefs about Competitors brands:Competitive de-positioning


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IV. Alter the Importance Weights:Diverting customers attention towards the attributes in

which the brand excels.V. Call Attention to Neglected Attributes.VI. Shift the Buyers Ideals:Marketers will persuade buyers to change the ideals for

one or more attributes by offering any attractive

attributes.4. Purchase Decision:Two factors are important.One: Attitudes of othersTwo: Un anticipated situational factors

Mishap, emergencyor you need money for other purposesSituation at that momentRisk factor in purchase decision


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In one decision there are 5 or more sub-decisions.Brand decisionVendor decision (supplier, Purchase decision)Quantity decisionTiming decisionPayment method (credit card, cash payment, installments)5. Post- Purchase Behavior:

Marketer job does not end, when product is bought butit continues after purchase.

Satisfaction level (that matters)How much?Post-Purchase actions:

Satisfied customer will buy the product again.e.g. ChevroletOur best advertisement is our satisfied customers.


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Post-Purchase use and Disposal:

How consumers use and dispose off the product.If product is lying in the closet, it is not much satisfying.Send it to some body else and did not use by him self.How Lifestyles are identified:Psychographics

Science of measuring and categorizing life styles ofconsumers.

AIO Frame work activities, interest and opinions.VALS TM 1978 Values and Lifestyles.VALS 21988-89 Framework

Consumer Behavior Ch6 Presentation

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Transcript of Consumer Behavior Ch6 Presentation