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

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

CB

• the decision process and physical activity engaged in when evaluating, acquiring, using or disposing of goods and services."

- Loudon and Bitta

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.”

• Consumer Behavior may be defined as “the interplay of forces that takes place during a consumption process, within a consumers’ self and his environment.

• - 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”.

• The “consumer” includes both personal consumers and business/industrial/organizational consumers.

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.

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.

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).

MARKETING EVOLUTION IN INDIAPERIOD 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

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

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

Objectives of One-to-One Marketing

• To attain customers

• Sell them more products

• Make a profit

Digital Revolution in the Marketplace

• Allows customization of products, services, and promotional messages like never before

• Enhances relationships with customers more effectively and efficiently

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

Development of the Marketing Concept

Production Concept

Selling Concept

Product Concept

Marketing Concept

The Production Concept

• Assumes that consumers are interested primarily in product availability at low prices

• Marketing objectives:– Cheap, efficient production– Intensive distribution– Market expansion

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

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

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

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.

consumer market

“A consumer market can be defined a all the individuals and households who buy goods and services for personal consumption.”

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.

PROBLEM SOLVING BEHAVIOUR

TYPE OF PROBLEM SOLVING

POSSIBILITY & VOLUME OF INFO. STORED IN MEMORY

NEED FOR FURTHER INFO.

SOURCE OF FURTHERINFO.

SPEED OF INFO.PROCESSING

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

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.

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.

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.

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.

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.

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.

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

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

Experience Have expectations been met Reduce cognitive dissonance, while increasing satisfaction

Repeat purchase

What about loyalty • Keep reminding the customers• Constantly claim market leadership.

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…

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.

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…

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.

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.

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.

Consumer

Organizational Consumer

Personal Consumer

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.

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.

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

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.

• 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…

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

Example: 1A 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.

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.

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.

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

The Major Influences on Industrial Buyers

• Environment Factor

• Organizational Factor

• Interpersonal Factor

• Individual Factor

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.

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.

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.

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.

INTER DISIPLINAR DIMENSIONS OF CB

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.

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.

• 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.

• 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.

• 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.

• Anthropology: This is the influence of society on the individual viz., cultural and cross-cultural issues in buying behavior, national and regional cultures etc.

• 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.

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

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.

• 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).

•

• 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.

• 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.

• 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.

Characteristic features of Indian Consumers

INDIAN

CONSUMER

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

Implementing the Marketing Concept

• Consumer Research

• Segmentation

• Targeting

• Positioning

Consumer Research

• The process and tools used to study consumer behavior.

• Two perspectives:– Positivist approach– Interpretivist approach

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

Successful Positioning

• Communicating the benefits of the product, rather than its features

• Communicating a Unique Selling Proposition for the product

The Marketing Mix

• Product

• Price

• Place

• Promotion

Successful Relationships

Customer Value

Customer Satisfaction

Customer Retention

Types of Customers

• Loyalists

• Apostles

• Defectors

• Terrorists

• Hostages

• Mercenaries

• 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.

• 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.

• 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.

• 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

• 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.”

• 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.

• MERCENARIES

• those who have high satisfaction, but low loyalty. These customers areoften price-sensitive and will switch easily when they have the opportunity

• 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.

• 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

Customer Profitability-Focused Marketing

Tier 1: Platinum

Tier 2: Gold

Tier 3: Iron

Tier 4: Lead

Firm’s Marketing Efforts1. Product2. Promotion3. Price4. Channels of distribution

Sociocultural Environment1. Family2. Informal sources3. Other noncommercial sources4. Social class5. Subculture and culture

Output

Process

Input

Ext

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onsu

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Dec

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akin

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Dec

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Postpurchase Evaluation

Purchase1. Trial2. Repeat purchase

Need Recognition

Prepurchase Search

Evaluation of Alternatives

Psychological Field1. Motivation2. Perception3. Learning4. Personality5. Attitudes

Experience

Figure 1-1: A Model of Consumer Decision Making

Chapter 2

Consumer Behavior,Consumer Behavior,Eighth EditionEighth Edition

SCHIFFMAN & KANUK

Consumer Research

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.

PositivismPositivism

A consumer behavior research approach that regards the consumer behavior discipline as

an applied marketing science.

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.

InterpretivismInterpretivism

A postmodernist approach to the study of consumer behavior that focuses on the act of consuming rather than on the act of buying.

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.

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.”

– 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

• 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.

• 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.

• 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.

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.

• 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.

• 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.

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

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

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.

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

Table 2.2 Major Sources of Secondary Data

Government Publications

Internal Sources

Periodicals &

Books

Commercial Data

Data Collection Methods

Observation

Experimentation

Surveys

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.

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.

Survey Data Collection Methods

Personal Interview

Mail

Telephone

Online

Table 2.4 Comparative Advantages

MAIL TELEPHONEPERSONAL INTERVIEW

ONLINE

Cost Low Moderate High LowSpeed Slow Immediate Slow FastResponse rate

Low Moderate HighSelf-

selectionGeographic flexibility

Excellent Good Difficult Excellent

Interviewer bias

N/A Moderate Problematic N/A

Interviewer supervision

N/A Easy Difficult N/A

Quality of response

Limited Limited Excellent Excellent

ValidityValidity

The degree to which a measurement

instrument accurately reflects what it is

designed to measure.

ReliabilityReliability

The degree to which a measurement instrument is consistent in what it

measures.

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.

Figure 2.4 Example of a Likert ScalePlease 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 Strongly2 = Agree3 = Neither Agree or Disagree4 = Disagree5 = 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.

Figure 2.4 Semantic Differential Profiles of Three Pay-Per-Movie Services

1

2

3

4

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DigitalCableDIVX

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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

Qualitative Data Collection Methods

Depth InterviewsDepth Interviews

Projective Projective TechniquesTechniques

FocusFocusGroupsGroups

Metaphor Metaphor AnalysisAnalysis

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.

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)

Projective Projective TechniquesTechniques

Research procedures designed to identify

consumers’ subconscious feelings

and motivations.

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.

Sampling Plan Decisions

Whom to survey?Whom to survey?

How many?How many?

How toselect them?

How toselect them?

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.

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).

Chapter 4

Consumer Behavior,Consumer Behavior,Eighth EditionEighth Edition

SCHIFFMAN & KANUK

The Consumer as an Individual

Figure 4.1 Model of the Motivation Process

LearningLearning

Needs wants, and

desires

Needs wants, and

desiresTensionTension

Goal or need

fulfill-ment

Goal or need

fulfill-ment

DriveDrive BehaviorBehavior

Cognitive processes

Cognitive processes

Tension reduction

Tension reduction

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

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.”

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

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

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

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

Frustration

Failure to achieve a goal may result in

frustration. Some adapt; others adopt defense

mechanisms to protect their ego.

Defense Defense MechanismMechanism

Methods by which people mentally

redefine frustrating situations to protect their self-images and

their self-esteem.

Table 4.2 Defense Mechanisms

• Aggression• Rationalization• Regression• Withdrawal

• Projection• Autism• Identification• Repression

• 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.”

• 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.

• 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.

• 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.

• 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.

• 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.

• 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.

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.

• 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.

Arousal of Motives

• Physiological arousal• Emotional arousal• Cognitive arousal• Environmental arousal

• 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.

• 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.

• 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.

• 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.

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

Physiological Needs(Food, water, air, shelter, sex)

Safety and Security Needs(Protection, order, stability)

Social Needs(affection, friendship, belonging)

Figure 4.9 Maslow’s Hierarchy of Needs

Ego Needs(Prestige, status, self esteem)

Self-Actualization(Self-fulfillment)

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

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

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

Motivational Motivational ResearchResearch

Qualitative research designed to uncover

consumers’ subconscious or hidden motivations.

Consumers are not always aware of, or may not wish

to recognize, the basic reasons underlying their

actions.

What is Personality?

The inner psychological characteristics that both

determine and reflect how a person responds to his

or her environment.

The Nature of Personality

• Personality reflects individual differences• Personality is consistent and enduring• Personality can change

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

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

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

Table 5.1 Snack Food Personality Traits

Potato Chips:Ambitious, successful, high achiever, impatient

Tortilla Chips:Perfectionist, high expectations, punctual, conservational

Pretzels:Lively, easily bored, flirtatious, intuitive

Snack Crackers:Rational, logical, contemplative, shy, prefers time alone

Horney’s CAD Theory

• Using the context of child-parent relationships, individuals can be classified into:– Compliant individuals– Aggressive individuals– Detached individuals

Compliant Personality

One who desires to be loved, wanted, and

appreciated by others.

Aggressive Personality

One who moves against others (e.g.,

competes with others, desires to excel and

win admiration).

Detached Personality

One who moves away from others (e.g., who desires independence, self-sufficiency, and

freedom from obligations).

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

Personality Traits and Consumer Innovators

• Innovativeness

• Dogmatism

• Social Character

• Need for uniqueness

• Optimum stimulation level

• Variety-novelty seeking

Consumer Consumer InnovativenessInnovativeness

The degree to which consumers are

receptive to new products, new services

or new practices.

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.

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.

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

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

Need for Uniqueness

Consumers who avoid appearing to conform to

expectations or standards of others.

Optimum Optimum Stimulation Stimulation

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.

SensationSensationSeeking Seeking

(SS)(SS)

A personality trait characterized by the need

for varied, novel, and complex sensations and

experience, and the willingness to take physical and social risks for the sake

of such experience.

Variety-Variety-Novelty Novelty SeekingSeeking

A personality trait similar to OSL, which measures a

consumer’s degree to variety seeking

Examples:•Exploratory Purchase

Behavior•Use Innovativeness

•Vicarious Exploration

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

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

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,

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

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

Table 5.4 Sample Items - MaterialismSUCCESSThe 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.

CENTRALITYI 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.HAPPINESSI’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.

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

Compulsive Consumption

Behavior

Consumers who are compulsive buyers

have an addiction; in some respects, they are out of control and their

actions may have damaging

consequences to them and to those around

them.

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.

Consumer Ethnocentrism

• Ethnocentric consumers feel it is wrong to purchase foreign-made products

• They can be targeted by stressing nationalistic themes

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.

Brand Personality

• Personality-like traits associated with brands• Volvo - safety• Perdue - freshness• Nike - the athlete• BMW - performance• Levi’s 501 - dependable and rugged

Figure 5.7 A Brand Personality Framework

Brand Personality

RuggednessSophisticationCompetenceExcitementSincerity

•Down-to-earth

•Honest•Wholesome•Cheerful

•Daring•Spirited•Imaginative•Up-to-date

•Reliable•Intelligent•Successful

•Upper class•Charming

•Outdoorsy•Tough

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

Table 5.10 continuedHuman, 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

Different Self-Images

Actual Self-Image Ideal Self-Image

Ideal SocialSelf-Image

Social Self-Image

ExpectedSelf-Image

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

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___.

Virtual Personality

• Online individuals have an opportunity to try on different personalities

• Virtual personalities may result in different purchase behavior

Consumer Behavior: A FrameworkJohn C. Mowen

Michael S. Minor

Chapter 5:

Consumer Motivation

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

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.

• 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).

The Structure of Emotions

• Ten Fundamental Emotions People Experience:– Disgust Interest– Joy Surprise– Sadness Anger– Fear Contempt

– Shame Guilt

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.

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.

• 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.

Classical Conditioning RelationsUnconditioned/Secondary Stimulus Unconditioned Response

Pairing

Conditioned Stimulus Conditioned Response

FlagEmotions

Politicalcandidate

Emotions

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.

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

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.

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.

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)

A Punisher . . .

. . . is any stimulus whose presence after a behavior decreases the likelihood of the behavior reoccurring.

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.

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.

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.

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.

Shaping Consumer Responses . . .

. . . is creating totally new operant behaviors by selectively reinforcing behaviors that successively approximate the desired instrumental response.

Vicarious Learning . . .

. . . is the phenomenon where people observe the actions of others to develop “patterns of behavior.”

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.

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.

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

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

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.

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.

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.

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.

7 Types of Consumer Risks.

• Financial• Performance• Physical• Psychological• Social• Time• Opportunity Loss

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

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.

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.

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.

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.

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.

Chapter 6

Consumer Behavior,Consumer Behavior,Eighth EditionEighth Edition

SCHIFFMAN & KANUK

Consumer Perception

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

• 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.

• 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

Elements of Perception

• Sensation• Absolute threshold• Differential threshold• Subliminal perception

Sensation

The immediate and direct response of the sensory

organs to stimuli.

A perfectly unchanging environment provides

little to no sensation at all!

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.

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).

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

• 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

• 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.

Subliminal Perception

Perception of very weak or rapid stimuli received below the level of conscious

awareness.

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

Aspects of Perception

Selection

Organization

Interpretation

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.

• 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.

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.

• 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.

• 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.

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.

• 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.

• 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.

• 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.

• 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

• 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.

Concepts Concerning Selective Perception

• Selective Exposure• Selective Attention• Perceptual Defense• Perceptual Blocking

Gestalt Gestalt PsychologyPsychology

• 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).

• 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.

• 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.

• 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.

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.

Principles of Perceptual Organization

• Figure and ground• Grouping• Closure

• 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.

• 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.

• 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.

– 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.

• 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.

– 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.

– 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.

• 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.

• 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.

Influences of Perceptual Distortion

• Physical Appearances• Stereotypes

• First Impressions• Jumping to Conclusions

• Halo Effect

• 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.

• 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.

• 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 he/she belongs.

– Example: Chinese goods are regarded as low in price and inferior in quality. However, not all goods may be inferior in quality. However, they are stereotyped as cheap and inferior.

– Another example: Sony is a reputed electronics company. Even before a person has heard fully about a new product from Sony, he or she concludes that the product would be good because it is a Sony product.

• Irrelevant cues: • When people make interpretations on the basis of irrelevant

and unmeaningful stimuli, they are said to have made a perceptual error based on irrelevant cues. The perceptual judgment in such cases is made on irrelevant cues. – Example: While purchase of a car, people get carried way by the

looks, aesthetics and appeal. Rather than thinking about the mechanical aspects and the technology used, they give importance to the looks and the accessories and take a decision. This is a perceptual error as the interpretation drawn is based on irrelevant cues.

• First impression:

• People often make judgments on the basis of the first impression. This may not always be true and could be erroneous. If erroneous, it would be known as a perceptual error based on first impression.

• First impression as a principle has implications for a marketer. A new product should never be introduced in the market before it has been market tested. In case it is not tested and launched, and subsequently fails, it could be disastrous for the company.

• All subsequent attempts to satisfy the customer would fail as first impression is long lasting. – Example: Companies recruit salespeople who have a

good pleasing personality, can converse well and have the power to convince. This is because they want their salespersons to carve a good impression the first time they meet the customers.

• Jumping to conclusion:

• -People often exhibit a tendency to arrive at conclusion even before have gone through the entire stimuli or information. This is referred to as jumping to conclusion. – Example: A salesperson knocks at the door of the house, and

introduces himself as a salesperson from Eureka Forbes. Even before he can say that he has come in to make a demonstration for a vacuum cleaner, the lady of the house interrupts and says that she already owns an Aquaguard and does not need another. This premature statement that she makes before letting the salesperson complete his sentence is an example of jumping to conclusion.

• Inference: • The tendency to draw out conclusion and making judgments

about the stimuli (person, place, thing etc.) on the basis of incomplete or limited information is called inference.

– Example: When a consumer assesses the quality of a product to be good, just because it is priced very high, he is said to be drawing an inference. He would be drawing a conclusion only on limited information that is price, and would be ignoring the technical details.

• Halo effect:

• When a stimuli (person, place, thing etc.), is perceived on the basis of a single trait, it is referred to as a Halo effect.

• In case the assessment is based on a good and desirable, it is referred to as a Halo effect or a positive Halo effect, and in case the assessment is based on something bad and undesirable, it is called a reverse Halo effect.

• One particular trait overrides all the other traits and a perception is made on a single trait. The evaluation of the stimuli on a multitude of dimensions is actually based on the evaluation of just one or a few of the dimensions.

– Example: Proctor and Gamble has roped in Kajol as their brand ambassador for Oil of Olay. When consumers perceive the Oil of Olay to be a good lotion, just because it is being endorsed by a successful actress like Kajol, the Halo effect would come into play. Kajol’s presence overrides all other qualities present in Oil of Olay or in its company, Proctor and Gamble.

– Another example: iPod has had a positive impact on perceptions of other products from Apple. With the success of the iPod, the benefits have got translated to other products made by Apple Inc.

Issues In Consumer Imagery

• Product Positioning and Repositioning• Positioning of Services• Perceived Price• Perceived Quality• Retail Store Image• Manufacturer Image• Perceived Risk

• Consumers formulate images of the marketing stimuli that they are faced with; this is referred to as imagery. The perceived images that get formed may relate to the product/service offerings and the marketing mix.

Positioning

Establishing a specific image for a brand in relation to competing

brands.

Positioning Techniques

• Umbrella Positioning

• Positioning Against Competition

• Positioning Based on a Specific Benefit

• Conveying a Product Benefit

• Taking an Unowned Position

• Positioning for Several Positions

• Repositioning

Perceptual Mapping

A research technique that enables marketers

to plot graphically consumers’ perceptions

concerning product attributes of specific

brands.

Figure 6.14 Perceptual Mapping

MoreArtwork

MoreCopy

Fashion Coverage

Club Coverage

Splash

Crash

FashionSplash

Bash

Table 6.2 Pricing Strategies Focused on Perceived Value

• Satisfaction-based Pricing

• Relationship Pricing

• Efficiency Pricing

Issues in Perceived Price

• Reference prices– Internal– External

• Tensile and objective price claims

Acquisition-Transaction Utility

• Acquisition utility represents the consumer’s perceived economic gain or loss associated with the purchase

• Function of product utility and purchase price

• Transaction utility concerns the perceived pleasure or displeasure associated with the financial aspect of the purchase

• Determined by the difference between the internal reference price and the purchase price

Tensile and Objective Price Claims

• Evaluations least favorable for ads stating the minimum discount level

• Ads stating maximum discount levels are better than stating a range

Perceived Quality

• Perceived Quality of Products– Intrinsic vs. Extrinsic Cues

• Perceived Quality of Services• Price/Quality Relationship

Characteristics of Services

• Intangible• Variable

• Perishable• Simultaneously

Produced and Consumed

Table 6.3 SERVQUAL Dimensions for Measuring Service Quality

DIMENSION DESCRIPTION

•Tangibles Appearance of physical facilities, equipment, personnel, and communication materials

•Reliability Ability to perform the promised service dependably and accurately

•Responsiveness Willingness to help customers and provide prompt service

•Assurance Knowledge and courtesy of employees and their ability to convey trust and confidence•Empathy Caring, individualized attention the firm provides its customers

Figure 6.16 Conceptual Model of the Consequences of Service Quality

Superior

Inferior

Favorable

Unfavorable

Remain

Behavior

Defect

+$Ongoing Revenue

Increased SpendingPrice Premium

Referred Customers

Financial Consequences

-$Decreased Spending

Lost CustomersCosts to AttractNew Customers

ServiceQuality

BehavioralIntentions

Focus of present study

Empirical links demonstrated in macro studies

Price/Quality Price/Quality RelationshipRelationship

The perception of price as an indicator of

product quality (e.g., the higher the price, the

higher the perceived quality of the product).

Figure 6.17 Conceptual Model of the Effects of Price, Brand Name, and Store Name on Perceived

Value

Objective Price

Perception of Price

Perceived Sacrifice

Perceived Quality

Perceived Value

Willingness to Buy

A. Conceptual Relationship of Price Effect

+

++

+

--

Figure 6.17 continued

B. Extended Conceptualization to Include Brand Name and

Store Name

Store Name

Brand Name

Perception of Store

Perception of Brand

+

+

Objective Price

Perception of Price

Perceived Sacrifice

Perceived Quality

Perceived Value

Willingness to Buy

+

+

+

+

-

-

Perceived RiskTypes• Functional Risk• Physical Risk• Financial Risk• Psychological Risk• Time Risk

The degree of uncertainty

perceived by the consumer as to the

consequences (outcome)

of a specific purchase decision.

How Consumers Handle Risk

• Seek Information• Stay Brand Loyal• Select by Brand Image• Rely on Store Image• Buy the Most Expensive Model• Seek Reassurance

Chapter 8

Motivation, Emotion, Mood, and Involvement

Chapter Spotlights

• How human needs motivate consumers to buy• What specific motives play a role in marketplace

behavior• How marketers can elicit specific emotions to sell

products and services• How moods affect consumption patterns• How consumer involvement with products and

services changes the effects of marketing information

Consumer Motivation

• It is the drive to satisfy needs and wants, both physiological and psychological, through the purchase and use of products and services.

• Stages (Exh. 8-2) of the motivation process:– Latent need– Drive– Want or desire– Goal– Behavior

Behavioral Models of Motivation

• Maslow’s hierarchy of needs– Motivation as a means of satisfying human needs– Five types of needs:

• Physiological: food, water, sleep, exercise, sex• Safety: security, shelter, normalcy in daily life• Love and belongingness: affection and acceptance as part of a family or

group• Esteem or status: respect from others; need to feel competent, confident,

important, and appreciated; self-respect• Self-actualization: the need to realize one’s own potential, to achieve dreams

and ambitions; hunger for knowledge and understanding; to do things for the sake of doing them

– Marketing implications

Models (continued)

• Dichter’s major consumption motives– 1950 study regarding the consumer needs

motivating the purchase of Ivory soap (P&G).• He found a relation between the use of soap and the need

for spiritual purity• 12 key motivations lead to product purchase

Models (continued)

• Sheth’s consumer motives– Five dimensions of motivation concerning

products/services benefits• Functional – utility or function performed• Aesthetic/emotional – appearance or attractiveness• Social – status or esteem value• Situational – unexpected benefit• Curiosity – interest aroused

Consumer Motivation and Marketplace Behavior

• Influence on consumer decision making (Exh 8-6)• Influence on consumer conflict resolution

– Approach-approach conflict – choosing between two equally attractive options

– Approach-avoidance conflict – considering an option that has both good and bad outcomes

– Avoidance-avoidance conflict – choosing between two undesirable options

Triggering Consumer Motives

• Encouraging need recognition– Attempt to move consumer from actual state to

desired state

• Triggering motivation through need-benefit segmentation– Understand consumer benefits sought and offer

goods and services to deliver these benefits to specific target segments

Emotions

• Emotions are affective responses that reflect the activation within the consumer of beliefs that are deep-seated and value-laden.

• Beliefs emotions

Emotions (continued)

• Experiencing emotions – People purchase products and services to experience certain

emotional states or to achieve emotional goals (emotional arousal)

• Emotions and consumer satisfaction: e.g. joy or pleasant surprise yield satisfaction while distress or anger yield dissatisfaction

• Emotions and communication: e.g. pleasure or displeasure with ad yields similar attitudes toward the ad and the product. Some ads are designed to arouse specific emotions.

How Emotional States are Induced

• People have little control over the affective system– Affective responses to environmental cues are

immediate and automatic (e.g. color)• Some control is possible through our behavior• Advertising and emotions

– Anger– Fear– Humor– Warmth

Mood

• It is an affective state that is general and pervasive – Moods are much less intense than emotions– Consumers are much less conscious of moods and the effect

of moods on marketplace behavior.– Consumer moods are induced in three different marketplace

settings (Exh. 8 –12):• Service encounters

• Point-of-Purchase stimuli

• Communications

Effects of Moods

• On consumer recall – Recall increases if mood at time of encoding and

retrieval match• On consumer evaluation

– Negative mood negative product or service evaluation (and vice versa)

• On consumer behavior– Positive mood increases giving, encourages

consumers to seek variety and their willingness to try new things

Inducing Positive Moods

• In service encounters– Transaction mechanics

– Service personnel

– Physical setting

• In marketing communications– Media placement – medium is part of

the message

– Message aspects – claims, emotional music, pictures, etc.

Involvement

• A heightened state of awareness based on importance that motivates consumers to seek out, attend to, and think about product information prior to purchase.

• Two types of involvement– Situational – tied to a particular situation/circumstance and

specific product– Enduring – tied to a product category; persistent over time

and across different situations

Effects of Consumer Involvement

• Information search– High involvement greater information search (more shopping around)

• Information processing– Depth of comprehension

• High involvement deeper comprehension– Extent of cognitive elaboration

• High involvement more thinking– Extent of external arousal

• High involvement greater emotional arousal– Information transmission

• High involvement more frequent information transmission (talking about products) to others

Causes of Consumer Involvement

• Personal factors– Product’s image and needs it serves are congruent with a consumer’s

self-image, values and needs high involvement• Product factors

– The greater the perceived risk the greater consumer involvement– The more alternatives there are to choose from, the greater the

involvement– The higher the hedonic value of goods, the greater the involvement– The more socially visible a product is, the greater the involvement

Causes (continued)

• Situational factors– Social pressure can significantly increase

involvement– The imminence of the decision heightens

involvement– Irrevocable purchase decisions heighten

enrollment

Involvement-based Consumer Behavior Models

• Low-involvement learning model

– Replacing old brand perceptions with new beliefs without attitude change

• Learn (information)-Feel (attitude)-Do (behavior) hierarchy (See Exhibit 8 – 14)

– High involvement/high thinking (Thinker): Learn-Feel-Do

– High involvement/high feeling (Feeler): Feel-Learn-Do

– Low involvement/low thinking (Doer): Do-Learn-Feel

– Low involvement/low feeling (Reactor): Do-Feel-Learn

Models (continued)

• Level of message processing model– Consumer attention to advertising is influenced by the

following four levels of involvement: pre-attention, focal attention, comprehension, and elaboration

• Product versus brand involvement model– Brand loyalists– Information seekers– Routine brand buyers– Brand switchers

CHAPTER TEN

Motivation, Personality, and Emotion

McGraw-Hill/Irwin Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved.

Motivation: An activated state within a person that leads to goal-directed behavior. It is the reason for behavior.

Motive: An unobservable inner force that stimulates and compels a behavioral response and provides specific direction to that response.

Involvement and AffectActual

State

Stimulus

Desired State

NeedRecognition

Drive State

Goal- directed Behavior

Incentive Objects

Consumer Motivation

5. Self-actualization: This involves the desire for self-fulfillment, to become all that one is capable of becoming.

4. Esteem: Desires for status, superiority, self-respect, and prestige are examples of esteem needs. These needs relate to the individual’s feelings of usefulness and accomplishment.

3. Belongingness: Belongingness motives are reflected in a desire for love, friendship, affiliation, and group acceptance.

2. Safety: Feeling physical safety and security, stability, familiar surroundings, and so forth are manifestations of safety needs. They are aroused after physiological motives

are minimally satisfied, and before other motives.

1. Physiological: Food, water, sleep, and to a limited extent, sex, are physiological motives. Unless they are minimally satisfied, other motives are not activated.

Maslow’s Motive Hierarchy

Advanced

Basic

Marketing Strategies and Maslow’s Hierarchy

McGuire’s Psychological Motives

• Classification System with 16 categories

• Two criteria determine 4 major categories:– Is mode of motivation cognitive or affective?

– Is the motive focused on preservation or growth?

• Four categories subdivided further:– Is the behavior initiated or a response?

– Is this behavior internal or external?

McGuire’s Cognitive Motives• Cognitive Preservation Motives

– Need for Consistency (active, internal)– Need for Attribution (active, external)– Need to Categorize (passive, internal)– Need for Objectification (passive, external)

• Cognitive Growth Motives– Need for Autonomy (active, internal)– Need for Stimulation (active, external)– Teleological Need (passive, internal)– Utilitarian Need (passive, external)

McGuire’s Affective Motives• Affective Preservation Motives:

– Need for Tension Reduction (active, internal)– Need for Expression (active, external)– Need for Ego Defense (passive, internal)– Need for Reinforcement (passive, external)

• Affective Growth Motives:– Need for Assertion (active, internal)– Need for Affiliation (active, external)– Need for Identification (passive, internal)– Need for Modeling (passive, external)

Motivation Theory and Marketing Strategy

• Discovering Purchase Motives

• Marketing Strategies Based on Multiple Motives

• Marketing Strategies Based on Motivation Conflict

• Do Marketers Create Needs?

Latent and Manifest Motives

Motivation Research Techniques

Motivation Conflict

• Approach-Approach Conflict

• Approach-Avoidance Conflict

• Avoidance-Avoidance Conflict

Create Needs?

Do marketers create needs?

Discussion

Describe Adam Sandler

Personality TheoryTwo Common Assumptions:• All individuals have internal

characteristics or traits• Consistent and Measurable

differences between individuals

Consumer Insight 10-1• What problems and issues would arise in

segmenting a market into high- and low-NFC segments?

• What implications does each of the nine research findings described above have for marketing practice?

• How do you think media preferences would vary between high- and low-NFC consumers?

The Five-Factor Model of Personality

Dimensions of Brand Personality

Brand personality

Describe the personality of the following:• Arizona Iced Tea• Intel• Blockbuster Video• Wal-Mart• Toyota• Dr. Pepper• Aquafina• Seiko• Texas Instruments• Nordstroms

Brand personalityWhat personality characteristics come to mind for the following:• Brand is repositioned several times or changes its slogan repeatedly• Brand uses continuing character in its advertising• Brand charges a high price and uses exclusive distribution• Brand frequently available on deal• Brand offers many line extensions• Brand sponsors show on PBS or uses recycled materials• Brand features easy-to-use packaging or speaks at consumer’s level

in advertising• Brand offers seasonal clearance sale• Brand offers five-year warranty or free customer hot line

The Nature of Emotions

Dimension Emotion Indicator/Feeling

Pleasure Duty Moral, virtuous, dutiful

Faith Reverent, worshipful, spiritual

Pride Proud, superior, worthy

Affection Loving, affectionate, friendly

Innocence Innocent, pure, blameless

Gratitude Grateful, thankful, appreciative

Serenity Restful, serene, comfortable, soothed

Desire Desirous, wishful, craving, hopeful

Joy Joyful, happy, delighted

Competence Confident, in control, competent

Emotional Dimensions, Emotions, and Emotional Indicators

Dimension Emotion Indicator/Feeling

Arousal Interest Attentive, curious

Hypoactivation Bored, drowsy, sluggish

Activation Aroused, active, excited

Surprise Surprised, annoyed, astonished

Déjà vu Unimpressed, uninformed, ,unexcited

Involvement Involved, informed, enlightened, benefited

Distraction Distracted, preoccupied, inattentive

Surgency Playful, entertained, lighthearted

Contempt Scornful, contemptuous, disdainful

Emotional Dimensions, Emotions, and Emotional Indicators

Dimension Emotion Indicator/Feeling

Dominance Conflict Tense, frustrated, conflictful

Guilt Guilty, remorseful, regretful

Helplessness Powerless, helpless, dominated

Sadness Sad, distressed, sorrowful, dejected

Fear Fearful, afraid, anxious

Shame Ashamed, embarrassed, humiliated

Anger Angry, initiated, enraged, mad

Hyperactivation Panicked, confused, overstimulated

Disgust Disgusted, revolted, annoyed, full of loathing

Skepticism Skeptical, suspicious, distrustfulSource: Adapted with permission from M. B. Holbrook and R. Batra, “Assessing the Role of Emotions on Consumer Response to Advertising,” Journal of Consumer Research, December 1987, pp. 404-20. Copyright © 1987 by the University of Chicago.

Emotional Dimensions, Emotions, and Emotional Indicators

Emotions and Marketing Strategy

• Emotion arousal as a product benefit

• Emotion reduction as a product benefit

• Emotion in advertising– Enhances attention, attraction, and maintenance

capabilities– Processed more thoroughly– May be remembered better

Measuring Emotional Arousal

• Emotional Measurement System– Developed by BBDO– 26 emotions triggered by ads

• Galvanic Skin Response– Small electrodes that monitor the skin– Lie detector test

Emotional Arousal & Mail Response Rates