Consumer Behaviour Module 1 and 2 PGCHM KCCMS SEM 2
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Transcript of Consumer Behaviour Module 1 and 2 PGCHM KCCMS SEM 2
Consumer Behaviour
Our Road Map
1. Introduction to the study of Consumer Behaviour and is strategic application
2. Understanding the Consumer as an Individual
3. Examining the consumer in his social and cultural setting
4. The Consumer Decision making process
5. Consumerism and Various Consumer Protection Acts
How will it help to study Consumer
Behaviour?
To be able to better understand the application of
Consumer behaviour to Marketing
Strategy.
To make
better
Marketing
campaigns
To understand
the psychological
and Social
underpinnings to
the behaviours of
consumers
To k
now
ho
w
Con
sum
ers
Rea
ct to
Inno
vation
s
To learn how new products are adopted and
diffused through society
Grading System
Internals 40 Marks
(Assignments/ Internals at Group/ Individual levels)
External Theory Paper 60 Marks
Total 100 Marks
Module 1
Consumer Behaviour
Origins, Strategic Applications, Consumer Research and Market Segmentation
Module 2
The Consumer as an Individual
Consumer Motivation, Personality, Consumer Perception, Learning, Attitude Formation and Change, Communication and Consumer Behaviour
Module 3
Social and Cultural Settings
Reference Groups and Consumer behaviour, Influence of Culture and subculture on Consumer Behaviour
Module 4
Consumer decision making process
Consumer Influence and diffusion of Innovations
Module 5
Consumerism and Consumer protection with reference to India
Our Syllabi
Recommended Reference Books
• Schiffman, L.G. and Kanuk L.L. Consumer Behaviour, Pearson Education, New Delhi.
• Michael R. Solomon, Consumer Behaviour, PHI New Delhi, 2003
• Kumar: Conceptual Issues in Consumer Behaviour : The Indian Context, Pearson education, New Delhi.
Consumer Behaviour
Origins, Strategic Applications, Consumer Research and Market Segmentation
Module 1
Module 1 - Consumer Behaviour
New Age Solutions when you…
Missed a television programWant to read a bookWant to avoid pesky commercialsWant to remember a friends birthdayNeed to send a quick gift to your loved onesNeed to rush to another city for workWant to socializeWant to be on time everywhereNeed to impress boss while on holidayNeed to impress wife on her birthdayHave to throw an impromptu lunch party for your friendsDidn’t get time to make lunch for the dayFeel drowsy but need to keep awakeWant to avoid calling someone but still pass on a messageFeel Bored, Down and Out
Meaning and Origins
Module 1 - Consumer Behaviour
All these New ways of selling products and services became available to us in the past fifteen years and are the result of digital technologies.
Another thing in common being… They exist today because they reflect an understanding of Consumer Needs and Consumer Behaviour.
Meaning and Origins
Which means that…
So how does one define Consumer Behaviour ?
“Consumer Behaviour is the behaviour that Consumers display in searching for, purchasing, using, evaluating and disposing of products and services that they expect will satisfy their needs.”
Consumer behaviour focuses on how individuals make decisions to spend their available resources (time, money, effort) on consumption related items. That includes what they buy, how they buy, when they buy, how often they buy
Module 1 - Consumer Behaviour Meaning and Origins
Consumer behaviour focuses on how individuals make decisions to spend their available resources (time, money, effort) on consumption related items.
What I buy
How I buy
When I buy
Where I buyHow often
I buy
How often I use what
I buy
How I evaluate
after I buy
How I allow my evaluations to impact future
purchases
How I dispose after I use what I
buy
CONSUMER
Module 1 - Consumer Behaviour Meaning and Origins
Consumer Behaviour has its roots in the “Marketing concept”
Production ConceptEg Henry Ford
Tata NanoProduct Concept
Eg Skywalks in Mumbai,Indian Education SystemLimitation: Marketing
Myopia
Selling ConceptEg Political
Parties promoting candidates
Marketing ConceptEvolved in late 1950s
“Make what it can sell instead of sell what it can make”
Eg. Colonel Sanders KFCRay Croc McDonalds
Module 1 - Consumer Behaviour Meaning and Origins
Marketing Mix
Marketing Mix
Product or ServiceFeatures, Designs, Brands
& Packaging Offered, along with post purchase
benefits such as warranties and return
policies
PriceList Price, Discounts,
allowances and Payment Methods
PromotionAdvertising, Public
elations, Sales Promotion, Personal
Selling, Direct Marketing of product/
service
PlaceDistribution through Specific Store and Non Store outlets
Module 1 - Consumer Behaviour Meaning and Origins
Three Drivers of Successful Relationships between Marketers and Customers
•Customer Value
•Customer Satisfaction
•Customer Retention
Module 1 - Consumer Behaviour Meaning and Origins
Three Drivers of Successful Relationships between Marketers and Customers
Customer Value Customer Satisfaction Customer Retention
Customer Value
Customer’s Perceived Benefits : Resources
(economic, functional & psychological) (monetary, time, effort, psychological)
Perceived Value is relative and subjective
Eg. Multiplex Experience, Meal at McDonalds
Module 1 - Consumer Behaviour Meaning and Origins
Three Drivers of Successful Relationships between Marketers and Customers
Customer Value Customer Satisfaction Customer Retention
Customer Satisfaction
The Individuals perception of the performance of the product or service in relation to his or her expectations. Eg. Expectations from Multiplex Experience versus Local Cinema Hall Experience.
Researchers propose that Companies should strive to create , raise the satisfaction of and turn them into ,
avoid having or , and reduce the number of
APOSTLESDEFECTORS LOYALISTS
TERRORISTS HOSTAGES MERCENARIES
Module 1 - Consumer Behaviour Meaning and Origins
Three Drivers of Successful Relationships between Marketers and Customers
Customer Value Customer Satisfaction Customer Retention
Customer Retention
In almost all business situations, it is more expensive to win new customers than to keep existing ones.
• Loyal Customers buy more products
• Loyal Customers are less price sensitive and pay less attention to competitors’ advertising
• Servicing Existing customers, who are familiar with the firms’ offerings and process, is cheaper
• Loyal Customers spread positive word-of-mouth and refer other customers
• Attracting new customers is expensive and almost impossible in saturated markets
Module 1 - Consumer Behaviour Meaning and Origins
Classifying Customers
Traditional method : Subdivision on the basis of demographic, sociocultural, psychographic, behavioural characteristics.Customer Probability-Focused Marketing : Tracks costs and revenues of Individual customers and then categorizes them into tiers based on consumption behaviours that are specific to the Company's offerings. “Customer Pyramid”
Platinum Tier
Gold Tier
Iron Tier
Lead Tier
Heavy users, not price sensitive, willing to
try new offerings
Compared to Platinum tier, more price sensitive hence not profitable. Ask for more
discounts, likely to buy from several providers
Spending Volume and profitability do not merit special treatment from Company
Cost the Company Money; Attention>Merit by spending; Overutilise Company resources; Negative Word of mouth
Module 1 - Consumer Behaviour Meaning and Origins
Simplified Model of Consumer Decision MakingExternal Influences
Input
Process
Output
Consumer Decision Making
Post decision Behaviour
Firm’s Marketing Efforts
4 Ps
SocioCultural Environment
Family, Informal Sources, Other Noncommercial Sources, Social Class, Culture and Subculture
Need Recognition
Prepurchase Search
Evaluation of Alternatives
Psychological Field Motivation, Perception, Learning, Personality, Attitudes
Experience
Purchase Trial; Repeat PurchasePostpurchase Evaluation
Consumer Behaviour
Origins, Strategic Applications, Consumer Research and Market Segmentation
Module 1
Consumer Research Process
Module 1 - Consumer Behaviour – Consumer Research
Quantitative Research Qualitative Research
Develop Objectives
Collect Secondary Data
Design Qualitative Research
•Method
•Screener Questionnaire
•Discussion Guide
Design Quantitative Research
•Method
•Sample Design
•Data Collection Instrument
Conduct Research
(using highly trained interviewers)
Analyze Data (Subjective)
Prepare Report
Collect Primary Data
(Usually by Field Staff)
Analyze Data (Objective)
Prepare Report
Exploratory Study
The Consumer Research Process (simplified model)
Define the Objective
Collect Secondary Data
Develop Research Design
Collect Primary Data
Analyze Data
Prepare Report of Findings
Module 1 - Consumer Behaviour – Consumer Research
Consumer Research Paradigms
Module 1 - Consumer Behaviour – Consumer Research
Quantitative Research Qualitative Research
Quantitative Measures
ObservationObservation
SurveySurvey
ExperimentationExperimentation
Module 1 - Consumer Behaviour – Consumer Research
Module 1 - Consumer Behaviour – Consumer Research
Three Basic Designs:
Observation – Mechanical (Eg Casino, Wal Mart) Physiological (eye movements, brain activity)
Experimentation (in laboratory or field) – Causal Research, Test Marketing, Virtual Reality Methods
Survey ( by questioning people)
Quantitative Research
Comparative Advantages and Disadvantages of various types of Surveys
Cost
Speed
Response RateGeographic FlexibilityInterviewer Bias
Interviewer Supervision
Quality of Response
MAIL TELEPHONE PERSONAL INTERVIEW ONLINELow
Slow
Low
Excellent
N/A
N/A
Limited
Moderate
Immediate
Moderate
Good
Moderate
Easy
Limited
High
Slow
High
Difficult
Problematic
Difficult
Excellent
Low
Fast
Self Selected
Excellent
N/A
N/A
Excellent
Module 1 - Consumer Behaviour – Consumer Research
Data Collection Instruments: (Reliable and Valid)
Questionnaires
Attitude Scales
Quantitative Research
• Avoid negatives• Avoid hypotheticals• Avoid words that could be misheard• Use response bands• Use mutually exclusive categories• Allow for “other” in fixed response questions
Questionnaire Do’s and Don’ts• Ensure questions are free of bias• Make questions simple• Make questions specific• Avoid jargon• Avoid sophisticated words• Avoid ambiguous words
Question Types - Dichotomous
In arranging this trip, did you contact American Airlines?
Yes No
Question Types – Multiple Choice
With whom are you traveling on this trip?
No one
Spouse
Spouse and children
Children only
Business associates/friends/relatives
An organized tour group
Question Types – Likert Scale
Indicate your level of agreement with the following statement: Small airlines generally give better service than large ones.
Strongly disagree
Disagree
Neither agree nor disagree
Agree
Strongly agree
Question Types – Semantic Differential
American Airlines
Large ………………………………...…………….Small
Experienced………………….………….Inexperienced
Modern………………………..………….Old-fashioned
Question Types – Importance Scale
Airline food service is _____ to me.
Extremely important
Very important
Somewhat important
Not very important
Not at all important
Question Types – Rating Scale
American Airlines’ food service is _____.
Excellent
Very good
Good
Fair
Poor
Question Types –Intention to Buy Scale
How likely are you to purchase tickets on American Airlines if in-flight Internet access were available?
Definitely buy
Probably buy
Not sure
Probably not buy
Definitely not buy
Qualitative MeasuresDepth Interviews
(one on one, usually half hour to an hour)Depth Interviews
(one on one, usually half hour to an hour)
Focus Group(8-10 respondents, screener questionnaire)
Focus Group(8-10 respondents, screener questionnaire)
Projective Techniques(Disguised tests with ambiguous stimuli)
Incomplete sentences, untitled pictures or cartoons, word association)
Projective Techniques(Disguised tests with ambiguous stimuli)
Incomplete sentences, untitled pictures or cartoons, word association)
Metaphor Analysis(Zaltman Metaphor Elicitation Technique)
Metaphor Analysis(Zaltman Metaphor Elicitation Technique)
Module 1 - Consumer Behaviour – Consumer Research
Focus Group in Session
Question Types –Completely Unstructured
What is your opinion of American Airlines?
Question Types –Word Association
What is the first word that comes to your mind when you hear the following?
Airline ________________________
American _____________________
Travel ________________________
Question Types –Sentence Completion
When I choose an airline, the most important consideration in my decision is: ________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________.
Question Types –Story Completion
“I flew American a few days ago. I noticed that the exterior and interior of the plane had very bright colors. This aroused in me the following thoughts and feelings.” Now complete the story. ________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________
Question Types –Picture (Empty Balloons)
Question Types – Thematic Apperception Test
Make up a story that reflects what you think is happening in this picture.
42
Sampling Methods – Two Broad Categories
• Probability sampling– Randomization w/o subjective judgment– Each unit has a known, nonzero probability to be selected
• Non-probability sampling– Depends on researcher’s subjective judgment– Based on convenience or systematically employed criteria.– Some units will surely not be selected
Types of Samples
Probability Sample• Simple Random (every member of the population has a known and equal chance of being selected)• Systematic Random ( a member of the population is selected at random and then every nth person is selected)• Stratified Random ( The population is divided into mutually exclusive groups, such as age groups, and random
samples are drawn from each group)• Cluster ( The population is divided into mutually exclusive groups, such as blocks, and the researcher draws a
sample of the groups to interview
Nonprobability Sample• Convenience (The researcher selects the most accessible population members (E.g. Students in a classroom)• Judgment (The researcher uses own judgment e.g. experts in the relevant filed of study)• Quota (The researcher interviews a prescribed number of people in each of several categories. E.g. 50 men and 50
women)
Module 1 - Consumer Behaviour – Consumer Research
The Consumer Research Process (simplified model)
Define the Objective
Collect Secondary Data
Develop Research Design
Collect Primary Data
Analyze Data
Prepare Report of Findings
Module 1 - Consumer Behaviour – Consumer Research
Module 1 - Consumer Behaviour – Market Segmentation
Market Segmentation
MarketMarket
MarketSegmentMarket
Segment
MarketSegmentation
MarketSegmentation
People or organizations with needs or wants and the ability and
willingness to buy
People or organizations with needs or wants and the ability and
willingness to buy
A subgroup of people or organizations sharing one or more characteristics that
cause them to have similar product needs.
A subgroup of people or organizations sharing one or more characteristics that
cause them to have similar product needs.
The process of dividing a market into meaningful, relatively similar, identifiable
segments or groups.
The process of dividing a market into meaningful, relatively similar, identifiable
segments or groups.
A Market is...
(1) people or organizations with
(2) needs or wants, and with
(3) the ability and
(4) the willingness to buy.
A group of people that lacks any one of these characteristics is not a market.
The Importance of Market Segmentation
Markets have a variety of product needs and preferences
Marketers can better define customer needs
Decision makers can define objectives and allocate resources more accurately
Learning Objective
Discuss criteria for successful Discuss criteria for successful market segmentation.market segmentation.
Criteria for successful segmentation:
Heterogeneous
Measurable
Substantial
Actionable
Accessible
Heterogeneous •Clear differences in consumer preferences for a product must exist.
•Difference in preferences for a product must be identifiable and capable of being related to measurable variables.
Measurable
•The proposed market segment must have enough size and purchasing power to be profitable.
Substantial
•Companies must be able to respond to difference in preferences with an appropriate and profitable marketing mix.
Actionable
•The proposed market segment must be readily accessible and reachable with targeted programs.
Accessible
Segmentation VariablesSegmentation Variables
Use-Situation Use-Situation SegmentationSegmentation
Geographic Geographic SegmentationSegmentation
Use-Related Use-Related SegmentationSegmentation
Demographic Demographic SegmentationSegmentation
Benefits-SoughtBenefits-Sought SegmentationSegmentation
Hybrid Hybrid SegmentationSegmentation
Psychological & Psychological & Psychographic Psychographic
SegmentationSegmentation
Sociocultural Sociocultural
SegmentationSegmentation
SexSexSexSex
Income LevelIncome LevelIncome LevelIncome Level
OccupationOccupationOccupationOccupationEducationEducationEducationEducation
AgeAge
Demographic Segmentation
Under 12, 12-17, 17-20, 20-25…
Below 1 lac pa., 1-3 lacs p.a., 3-6 lacs p.a., 6-9 lacs p.a., 10 lacs + p.a.
Some school, school, some college, college graduate, post graduate…
Professional, blue collar, white collar, agricultural, military
Male, Female, Transgender
Marital StatusMarital StatusSingle, married, divorced, living –in, widowed
Segmentation VariablesSegmentation Variables
Use-Situation Use-Situation SegmentationSegmentation
Geographic Geographic SegmentationSegmentation
Use-Related Use-Related SegmentationSegmentation
Demographic Demographic SegmentationSegmentation
Benefits-SoughtBenefits-Sought SegmentationSegmentation
Hybrid Hybrid SegmentationSegmentation
Psychological & Psychological & Psychographic Psychographic
SegmentationSegmentation
Sociocultural Sociocultural
SegmentationSegmentation
Geographic Segmentation
• When an organization localizes its marketing efforts to accommodate the unique needs of specific geographic regions
Density of AreaDensity of AreaDensity of AreaDensity of Area
City SizeCity SizeCity SizeCity Size
ClimateClimateClimateClimate
Geographic Segmentation
Major Metropolitan areas, small cities, towns, villages
Temperate, hot, humid, rainy, spring
Urban, Suburban, Rural
RegionRegionMaharashtra, Madhya Pradesh, North East, North India etc.
Segmentation VariablesSegmentation Variables
Use-Situation Use-Situation SegmentationSegmentation
Geographic Geographic SegmentationSegmentation
Use-Related Use-Related SegmentationSegmentation
Demographic Demographic SegmentationSegmentation
Benefits-SoughtBenefits-Sought SegmentationSegmentation
Hybrid Hybrid SegmentationSegmentation
Psychological & Psychological & Psychographic Psychographic
SegmentationSegmentation
Sociocultural Sociocultural
SegmentationSegmentation
PerceptionPerceptionPerceptionPerception
PersonalityPersonalityPersonalityPersonality
Learning InvolvementLearning InvolvementLearning InvolvementLearning Involvement
Psychological Segmentation
Extroverts, Novelty Seekers, aggressives, innovators
Low Involvement, High involvement
Low Risk, Moderate Risk, High Risk
Needs- MotivationNeeds- MotivationShelter, Safety, security, affection, sense of self-worth
AttitudesAttitudesAttitudesAttitudesPositive Attitude, Negative Attitude
Segmentation VariablesSegmentation Variables
Use-Situation Use-Situation SegmentationSegmentation
Geographic Geographic SegmentationSegmentation
Use-Related Use-Related SegmentationSegmentation
Demographic Demographic SegmentationSegmentation
Benefits-SoughtBenefits-Sought SegmentationSegmentation
Hybrid Hybrid SegmentationSegmentation
Psychological & Psychological & Psychographic Psychographic
SegmentationSegmentation
Sociocultural Sociocultural
SegmentationSegmentation
• Psychographics represents a combination of consumers’ activities, interests and opinions (AIO items)
• Useful but more difficult to identify and measure compared to demographic variables
Psychographic Segmentation
Lifestyle Lifestyle Lifestyle Lifestyle Economy Minded, Couch Potatoes, Outdoors, Enthusiasts,
status seekers
Segmentation VariablesSegmentation Variables
Use-Situation Use-Situation SegmentationSegmentation
Psychological & Psychological & Psychographic Psychographic
SegmentationSegmentation
Geographic Geographic SegmentationSegmentation
Use-Related Use-Related SegmentationSegmentation
Demographic Demographic SegmentationSegmentation
Benefits-SoughtBenefits-Sought SegmentationSegmentation
Sociocultural Sociocultural
SegmentationSegmentationHybrid Hybrid
SegmentationSegmentation
Social ClassSocial ClassSocial ClassSocial Class
CulturesCulturesCulturesCultures
Family Life CycleFamily Life CycleFamily Life CycleFamily Life Cycle
Sociocultural Segmentation
American, Indian, Greek, Chinese, Japanese, Mexican, French, Pakistani
Bachelors, Young marrieds, full nesters, empty nesters
Lower, Middle, upper
ReligionReligionCatholic, Protestant, Islam, Jewish…
Subcultures (race/ ethnic)Subcultures (race/ ethnic)Subcultures (race/ ethnic)Subcultures (race/ ethnic)African American, Indian American, Hispanic
Segmentation VariablesSegmentation Variables
Use-Situation Use-Situation SegmentationSegmentation
Geographic Geographic SegmentationSegmentation
Use-Related Use-Related SegmentationSegmentation
Demographic Demographic SegmentationSegmentation
Benefits-SoughtBenefits-Sought SegmentationSegmentation
Hybrid Hybrid SegmentationSegmentation
Psychological & Psychological & Psychographic Psychographic
SegmentationSegmentation
Sociocultural Sociocultural
SegmentationSegmentation
Awareness StatusAwareness StatusAwareness StatusAwareness Status
Brand LoyaltyBrand LoyaltyBrand LoyaltyBrand Loyalty
Use Related Segmentation
None, Some, Strong
Unaware, aware, interested, enthusiastic
Usage RateUsage RateSuper Heavy Users, Heavy Users, Medium
Users, Light users, Nonusers
Light Users80%
Light Users80%
Heavy Users20%
Heavy Users20%
Behavior/Usage Segmentation
• Markets can be segmented by how often or how heavily consumers use a specific product– 80/20 Principle - 80% of revenue generated by 20% of customers
Segmentation VariablesSegmentation Variables
Use-Situation Use-Situation SegmentationSegmentation
Geographic Geographic SegmentationSegmentation
Use-Related Use-Related SegmentationSegmentation
Demographic Demographic SegmentationSegmentation
Benefits-SoughtBenefits-Sought SegmentationSegmentation
Hybrid Hybrid SegmentationSegmentation
Psychological & Psychological & Psychographic Psychographic
SegmentationSegmentation
Sociocultural Sociocultural
SegmentationSegmentation
Situation Segmentation
ObjectiveObjectiveObjectiveObjective
LocationLocationLocationLocationHome, work, friends home, in-store
Personal, Gift, Snack, Fun, Achievement
TimeTimeLeisure, work, rush, morning, night
Self , Family members, friends, boss, peers
PersonPerson
Segmentation VariablesSegmentation Variables
Use-Situation Use-Situation SegmentationSegmentation
Geographic Geographic SegmentationSegmentation
Use-Related Use-Related SegmentationSegmentation
Demographic Demographic SegmentationSegmentation
Benefits-SoughtBenefits-Sought SegmentationSegmentation
Hybrid Hybrid SegmentationSegmentation
Psychological & Psychological & Psychographic Psychographic
SegmentationSegmentation
Sociocultural Sociocultural
SegmentationSegmentation
Benefits-Sought SegmentationMarkets can be segmented based on the
benefits that consumers desire from using a specific product
Convenience, Social Acceptance, Long Lasting, Economy, Value-for-money
Learning Objective
List the steps involved List the steps involved in segmenting markets.in segmenting markets.
Steps in Segmenting a Market
Select a market
for study
Choosebases
for segmen-
tation
Selectdescrip-
tors
Profileand
analyzesegments
Selecttarget
markets
Design,imple-ment,
maintainmkting
mix
Consumer BehaviourThe Consumer as an IndividualConsumer Motivation, Personality, Consumer Perception, Learning, Attitude Formation and Change, Communication and Consumer Behaviour
Module 2
Module 1 - Consumer Behaviour Consumer Motivation
Creating Needs
Charles Revson – Revlon Nail Polish
Deep Red Polish – fire and ice
Dark Red Polish – Berry Bon Bon
“In the factory we make cosmetics, in the store we sell hope”
Module 1 - Consumer Behaviour Consumer Motivation
Motivation is the Driving Force within individuals that impels them into action
Unfulfilled Needs, Wants or Desires
Tension Drive BehaviourGoal or Need
Fulfillment
Previous Learning
Cognitive Processes
Tension Reduction
Module 1 - Consumer Behaviour Consumer Motivation
Needs
Innate Needs, Physiological Needs (biogenic), Primary Needs- Food, water, air, clothing, shelter and sex
Acquired Needs, Secondary Needs – Self esteem, prestige, affection, power and learning
Example:
Executive… newly transferred… searching for a home.
Reflects Primary Need for shelter.
The type of home the individual buys or rents reflects Secondary Needs
Module 1 - Consumer Behaviour Consumer Motivation
Goals
Two types of Goals:
•Generic Goals
•Product Specific Goals
Example:
I want to make a career with airline services –Generic Goals
I want to study how to become a Pilot from ABC Institute of Flying Technology – Product Specific Goal
The goals marketers are more interested in… brand specific and need fulfilling
Example:
Girl needs tan. Two Options – Sun tan or Chemical Tan. The sun tan is an option provided by nature. The chemical tan is what the marketer provides.
Module 1 - Consumer Behaviour Consumer Motivation
Goals and Needs Model
Goal SettingFormation of a goal Intention
Action Planning
Action Initiation
and Control
Goal Attainment or failure
Feedback reactions
What are the goals I can pursue and why do I want to pursue them?
What is it for which I strive?
How can I achieve my
goal?
(when where how and how long should I
act?)
How well have I enacted my
plans?
Progress?
Adjustments needed?
Degree of achievement/
failure?
Goal: Lose Weight
Live Longer Boost Self Confidence
Look and feelgood
DietingExercising
Module 1 - Consumer Behaviour Consumer Motivation
Interdependence of Needs and Goals
There is an interdependence but people do not recognize their needs as well as they do their goals
Example:
Teenager with social needs finds himself making friends on chat rooms
Person with power needs finds himself standing for elections when a chance is available
College student with achievement needs may end up studying very hard to achieve good marks
Module 1 - Consumer Behaviour Consumer Motivation
Positive or Negative Motivation
Example:
Driven towards Restaurant for hunger needs
Away from motorcycles for safety needs
Driving force towards or away from an object or condition
Rational or Emotional Motives
Considering alternatives and careful selection or emotional decision based on pride, fear, affection or status
Example:
Person opting for cosmetic surgery
Module 1 - Consumer Behaviour Consumer Motivation
Dynamics of Motivation
•Needs are never fully satisfied
•New needs emerge as old needs are satisfied
•Success and failure influence Goals
-Substitute Goals
-Frustration
-Defense Mechanism (Aggression, Rationalization, Regression, Withdrawal, Projection, day dreaming, Identification, Repression)
•Multiplicity of Needs and variations of goals
Module 1 - Consumer Behaviour Consumer Motivation
Arousal of Motives
Physiological Arousal
Drop in Blood sugar level or stomach contractions…
Secretion of sex hormones…
A decrease in body temperature…
Emotional Arousal
Young lady day dreaming about torrid romance… chat room regular
Young man dreaming about being a novelist… enroll for writing course
Cognitive ArousalInvolves random thoughts that may lead to a cognitive awareness of needsRaymond Advertisement showing loving school teacher may arouse need for instantly calling teacherAdvertisement showing vote registration need may arouse immediate need for logging onto website and registering.
Environmental or Situational ArousalSmell of pastries from bakeryBeautiful scenery in ad for Singapore TourismEffect of television on underdeveloped nations population
Module 1 - Consumer Behaviour Consumer Motivation
… Arousal of Motives
Module 1 - Consumer Behaviour Consumer Motivation
Maslows Need Hierarchy theory
Physiological Needs
Food, water, air, shelter, sex. E.g.. Health Foods, Medicines, low fat products
Safety and Security Needs
Protection, Order, Stability E.g. Insurance, Preventive Medical Services, Home Security Systems
Social Needs
Affection, Friendship, Belonging. E.g. Personal Grooming Products
Ego and Esteem Needs
Prestige Status, Self Esteem E.g. Furs, Big cars, expensive Furniture`
Self Actualization
Self Fulfillment
E.g. PG Course, Road Trip
Class Test – Time 40 minutes
1. Define and Explain Consumer Behavior. Explain the Three Drivers of Successful Relationships between Marketers and Customers.
2. Explain the Consumer Decision Making process using a Simplified Model of Consumer Decision Making.
3. Explain the Consumer Research process and also the Consumer Research paradigms (Qualitative & Quantitative)
4. Explain Market Segmentation.
TEST INSTRUCTIONS
•Kindly write your roll number on the top right hand corner of your paper. NOT your name.
•Do not make margins on the right side of your paper.
•Please number your questions.
•Highlighting important points and subtitles is essential.
•Use examples wherever possible.
•Time limit to be strictly adhered to.
•Do well and make me proud :0)
Consumer BehaviourThe Consumer as an IndividualConsumer Motivation, Personality, Consumer Perception, Learning, Attitude Formation and Change, Communication and Consumer Behaviour
Module 2
Personality and Consumer Behaviour
• Appeal to individuality“We’re all created equal. But after that it’s up to you” – Harley Davidson
• Appeal to status/ innovativeness“Never Follow” – Audi
• Appeal to non-conformity“”For those who consider conformity a serious road hazard” – Saab 97X SUV
• Appeal to self assurance“Surf Excel hai na” – Surf Excel
Module 1 - Consumer Behaviour
Learning Objectives:
Brand Personality
Concept of self and self image
Virtual personality
Personality and Consumer Behaviour
• Definition of Personality“those inner characteristics that both determine and reflect how a person responds to his or her environment”
• 3 distinct properties of Personality1 Personality reflects individual differences2 Personality is consistent and enduring3 Personality can change
Module 1 - Consumer Behaviour
Personality and Consumer BehaviourModule 1 - Consumer Behaviour
• 3 distinct properties of Personality
1 Personality reflects individual differences2 Personality is consistent and enduring3 Personality can change
• The inner characteristics that constitute and individuals personality are a unique combination of factors, hence no two individuals are exactly alike
• The concept of personality is useful in categorizing customers into different groups on the basis of one or several traits
• Example:Venturesomeness
High : Willing to try something new. Skydiving, mountain climbing
Low : Afraid to buy a recently introduced product
Personality and Consumer BehaviourModule 1 - Consumer Behaviour
• 3 distinct properties of Personality1 Personality reflects individual differences
2 Personality is consistent and enduring3 Personality can change
• “My brother has always wanted to be different from the day he was born”
• Marketers cannot alter peoples personalities to conform to their products but…
• Consumers’ personalities may be consistent but consumption bahaviour often varies due to various psychological, sociocultural, environmental and situational factors that affect behaviour
Personality and Consumer BehaviourModule 1 - Consumer Behaviour
• 3 distinct properties of Personality
1 Personality reflects individual differences2 Personality is consistent and enduring
3 Personality can change
• Under certain circumstances, personality may change• Major life events : MARRIAGE, CHILD BIRTH, DEATH OF PARENT, JOB CHANGE, PROFESSION
CHANGE• Change may also be part of a gradual maturation process “ She is becoming calmer as she’s growing
up”• Personality Stereotypes may also change : “Females to acquire more masculine traits in coming 50
years”
Personality is defined as “the distinctive patterns of behavior, including thoughts, and emotions, that characterize each individual’s adaptation to the situations of his or her life.”
– The goal is to identify personality variables that distinguish large groups of people from each other.
– Individual difference variables describe how one person varies from another in his or her distinctive patterns of behavior: include personality, self-concept, psychographic, and even demographic variables.
Personality and Consumer BehaviourModule 1 - Consumer Behaviour
Self-concept . . .
. . . is defined as the “totality of the individual’s thoughts and feelings having reference to himself as an object.
– People have a strong need to act consistently with who and what they think they are.– People purchase products and services to build their self-image and to express
themselves to others.
Personality and Consumer BehaviourModule 1 - Consumer Behaviour
Psychographic analysis is . . .
. . . the attempt to measure the life-styles of consumers.
Personality and Consumer BehaviourModule 1 - Consumer Behaviour
Freud’s Psychoanalytic Theory Personality results from the clash of 3 forces - the id, the ego, and the superego
– The id represents physiological drives
– The ego acts to curb the appetites of the id
– The superego is the conscience or “voice within”
Personality and Consumer BehaviourModule 1 - Consumer Behaviour
Key Issues in Psychoanalytic Approach
– Basis for motivational researchers of 1950s.– Places high emphasis on symbols
• phallic, ovarian, and death symbols– Pleasure principle: basis for functioning of id.– Reality principle: basis for functioning of ego.– Death wish--elicited by death symbols.– Large impact on research methods
• depth interviews• focus groups
Personality and Consumer BehaviourModule 1 - Consumer Behaviour
Trait Theory
• A trait is any characteristic in which one person differs from another in a relatively permanent and consistent way.
• A person’s personality is described in terms of a particular combination of traits.• To be useful trait measures must be shown to be valid (i.e., they measure what they are said
to measure) and reliable (i.e., the measures show consistency over time)
Personality and Consumer BehaviourModule 1 - Consumer Behaviour
Trait Theory
• A trait is any characteristic in which one person differs from another in a relatively permanent and consistent way.
• A person’s personality is described in terms of a particular combination of traits.• To be useful trait measures must be shown to be valid (i.e., they measure what they are said
to measure) and reliable (i.e., the measures show consistency over time)
Personality and Consumer BehaviourModule 1 - Consumer Behaviour
Neo Freudian Theory
• Individuals classified into 3 personality groups• 1. Compliant Individuals (move towards others, brand conscious)• 2. Aggressive Individuals ( (move against others…desire to excel, need for admiration…Old Spice)• 3. Detached Individuals ( Individualists, self sufficient, independent…heavy tea drinkers)
Consumer Innovativeness
• General Consumer Innovativeness Scale:• 1. If I like a brand, I switch in order to try something different• 2. When I go to a restaurant I feel safer to order the dishes I am familiar with
• Domain Specific Consumer Innovativeness Scale:• 1. Compared to my friends, I own fewer rock albums• 2. I will buy a new rock album even if I haven’t heard it yet
Personality and Consumer BehaviourModule 1 - Consumer Behaviour
Relationship between Innovative Internet usage and buying online
Internet lovers and Risk Takers
Consumer Innovativeness
Personality and Consumer BehaviourModule 1 - Consumer Behaviour
•Dogmatism… Highly Dogmatic, Low Dogmatic
•Social Character… inner directedness and other directedness
•Need for uniqueness (NFU) … Higher Innovativeness
•Optimum Stimulation Level… High OSL; Low OSL… low OSL prefer simple uncluttered, calm existence…high OSL prefer novel, complex and unusual existence
•Sensation Seeking
•Variety Novelty Seeking ( exploratory purchase behaviour, vicarious exploration, use innovativeness)
Cognitive Personality Factors
Personality and Consumer BehaviourModule 1 - Consumer Behaviour
•Measures a persons craving for or enjoyment of thinking
•Eg Website
•VISUALIZERS VERSUS VERBALIZERS
Consumer Ethnocentrism
•The likeliness to be receptive to foreign made products.
Brand Personality Framework
Personality and Consumer BehaviourModule 1 - Consumer Behaviour
Brand Personality
Sincerity Excitement Competence Sophistication Ruggedness
Down To Earth
Honest
Wholesome
Cheerful
Daring
Spirited
Imaginative
Up to Date
Reliable
Intelligent
Successful
Upper Class
Charming
Outdoorsy
Tough
The Self-Concept in Consumer Research
• The Self-concept represents the “totality of the individual's thoughts and feelings having reference to himself as an object.”
Personality and Consumer BehaviourModule 1 - Consumer Behaviour
People have more than one self-concept:
• The actual self image• The ideal self image• The social self image• The ideal social self
• The expected self and ought to self
Personality and Consumer BehaviourModule 1 - Consumer Behaviour
People have more than one self-concept:
• Sample Items. Extended Self Survey• My ________ holds a special place in my life• My ________ is central to my identity• I feel emotionally attached to my ___________• I would be a different person without my ___________• I take good care of my __________• I trust my ____________• If my ________ were stolen from me, I would feel as if a part of me is missing
Personality and Consumer BehaviourModule 1 - Consumer Behaviour
Materialism: You Are What You Own
• Materialism is the importance a consumer attaches to worldly possessions
Personality and Consumer BehaviourModule 1 - Consumer Behaviour
Four (4) types of possessions help to make up our personal sense of self:
• Body and body parts• Objects
• Places and time periods• Persons and pets
Personality and Consumer BehaviourModule 1 - Consumer Behaviour
PRODUCT PERSONALITY AND GENDER
PRODUCT PERSONALITY AND GEOGRAPHY
PRODUCT PERSONALITY AND COLOUR
VIRTUAL PERSONALITY OR SELF
Personality and Consumer BehaviourModule 1 - Consumer Behaviour
Life-Style and Psychographic Analysis
• Life-style refers to how people live, how they spend their money, and how they allocate their time
• Life-style and personality are different, yet are closely related
Personality and Consumer BehaviourModule 1 - Consumer Behaviour
The distinction between personality and life-style:
– Personality refers to the internally based dispositions of the person. In contrast, life-style refers to the external manifestations of how a person lives.
• Psychographics is the quantitative investigation of consumers’ life-styles, personality, and demographic characteristics.
Personality and Consumer BehaviourModule 1 - Consumer Behaviour
AIO statements identify consumer activities, interests, and opinions
– Activity questions ask consumers to indicate what they do, what they buy, and how they spend their time.
– Interest questions focus on what the consumers’ preferences and priorities are.– Opinion questions ask for consumers’ views and feelings on such things as world, local,
moral, economic, and social affairs.
Personality and Consumer BehaviourModule 1 - Consumer Behaviour
A Warning
• Psychographic inventories often result in clever descriptions of a target market that can result in stereotypes.
• It can cause managers to view the target market as more homogeneous than it really is.
Personality and Consumer BehaviourModule 1 - Consumer Behaviour
Managerial Implications
• Position and differentiate product based upon the dominant personality or psychographic characteristic of the target market.
• Scan the environment to identify the dominant cultural values of the target market.• Use market research to identify the personality, self-concept, and psychographic
characteristics that distinguish the target market.• Develop promotions to be consistent with the dominant personality characteristics of target
market. Create products that fulfill the motivational needs of target—e.g., low risk products for the low need for arousal group.
• Use personality and psychographics to identify segments of consumers to target, such as one-price auto dealers for low bargain prone.
Personality and Consumer BehaviourModule 1 - Consumer Behaviour
Learning
• The process by which individuals acquire the purchase and consumption knowledge and experience that they apply to future related behavior
• Marketers must teach consumers:– where to buy– how to use– how to maintain– how to dispose of products
Behavioral Learning Theories
Classical Conditioning
Instrumental/Operant Conditioning
Modeling or Observational Learning
Classical Classical ConditioningConditioning
A behavioral learning theory
according to which a stimulus is paired
with another stimulus that elicits a known response that serves to produce the same response when used
alone.
Models of Classical ConditioningIVAN PAVLOV
Another Example
Instrumental Instrumental (Operant) (Operant)
ConditioningConditioning
A behavioral theory of learning based on a
trial-and-error process, with habits forced as the result of positive
experiences (reinforcement)
resulting from certain responses or behaviors.
Types of Reinforcement
o Positive
o Negative
o Forgetting
o Extinction
A Model of Instrumental Conditioning
Observational Observational LearningLearning
A process by which individuals observe how others behave
in response to certain stimuli and reinforcements. Also known as
modeling or vicarious learning.
The consumer observes a
positive response by two teens.
Cognitive Cognitive Learning Learning TheoryTheory
Holds that the kind of learning most characteristic of human beings is problem solving,
which enables individuals to gain some control over their environment.
Retention
• Information is stored in long-term memory
• Total package of associations is called a schema
Brand Loyalty
Loyalty
Latent Loyalty
Spurious Loyalty
No Loyalty
Consumer Attitude Formation & Consumer Attitude Formation & ChangeChange
Attitude FormationAttitude FormationHow Attitudes are Learned
Sources of Influence
Impact of Personality
How Attitude are LearnedHow Attitude are Learned
• Shift from NO ATTITUDE TO AN ATTITUDE
Sources of Influence• Through mass media we are constantly exposed to
new products, ideas etc thru advertising.
• For people without direct experience of the product, exposure to emotionally appealing Ads will create favorable attitude.
Impact of Personality• Consumer attitude is strongly influenced by
personal experience.• Primary means of attitude formation is through
consumers direct experience in trying and evaluating them.
TEST DRIVE
Strategies of Attitude ChangeStrategies of Attitude ChangeChanging the Consumer’s Basic Motivational Functions
Associating the Product with an Admired Group or Event
Resolving Two Conflicting Attitudes
Altering Components of the Multi-Attribute Model
Changing Consumer Beliefs About Competitors’ Brands
Changing the Consumer’s Basic Motivational Functions
The Utilitarian Function
The Ego-Defensive Function
The Value-Expressive Function
The Knowledge Function
Combined Several Function
The Utilitarian FunctionThe Utilitarian Function
The Ego-DefensiveThe Ego-Defensive Function Function
The Value-Expressive FunctionThe Value-Expressive Function
The Knowledge The Knowledge FunctionFunction
Combined Several FunctionCombined Several Function
Associating the Product with an Admired Group or Event
Resolving Two Conflicting Attitudes
ATTITUDE
Altering Components of the Multi-Attribute Model
Changing the Relative Evaluation of Attributes
Changing Brand Beliefs
Adding an Attribute
Changing the Overall Brand Rating
Changing the Relative Evaluation of Attributes
Changing Brand Beliefs
Adding an Attribute
Changing the Overall Brand Rating
Changing Consumer Beliefs About Competitors’ Brands
Thank You