Consumer Buying Behavior
Consumer Buying Behavior
& Decision Making

& Decision Making
Lecture 3 - Contents
1.

Introduction

2. What is Consumer Buying Behavior.
3. Factors Influencing Consumer Behavior

4. T...
1- Introduction

• Consumer OR Customers?
• Main Questions to answer?
– Who buys?
– How do they buy?
– When do they buy?
–...
2- What Is Consumer Behavior?
The process & activities people engage in when searching
for, selecting , purchasing, using,...
Model of Buyer Behavior

Marketers want to understand how the stimuli are changed into
responses inside the consumer’s bla...
“There is only one boss
THE CUSTOMER
And he can fire anyone , simply by spending his money
Somewhere else”
-Sam Walton,
Fo...
3- Factors Influencing Consumer Behavior
•

Cultural Factors

•

Social Factors

•

Personal Factors

•

Psychological Fac...
Factors Influencing Consumer Behavior
1. Cultural Factors:
• Culture is the set of basic values, perceptions, wants, and

behaviors learned by a member of socie...
Subculture: A group of people with shared value systems based
on common life experiences and situations.
•Each culture con...
Social class
Social classes: are society’s relatively permanent and ordered
divisions whose members share similar values, ...
The Major American
Social Classes
Factors Influencing Consumer Behavior
2. Social Factors
Reference Groups and opinion leaders
• Reference group: An actual or imaginary group conceived of having...
Family
• The family is the most important consumer buying organization in
society
• In the United States, the wife traditi...
Factors Influencing Consumer Behavior
3. Personal Factors
A buyer’s decisions also are influenced by personal characteristics such as the
buyer’s age and life-c...
Occupation
A person’s occupation affects the goods and services bought.
• Blue-collar workers end to buy more rugged work ...
Factors Influencing Consumer Behavior
4- Psychological Factors

A person’s buying choices are further influenced by four major
psychological factors:

•
•
•
•

...
Motivation
Motive: A need that is sufficiently pressing to direct the person to seek
satisfaction of the need.
A need beco...
Perception
Perception: it is the process by which an individual selects, organizes and
interprets information inputs to pr...
Learning
When people act, they learn. Learning describes changes in an individual’s behavior
arising from experience.

Bel...
4- The Buyer Decision Process
1- Problem Recognition (awareness of need):
Difference between the desired state and the act...
3-Evaluation of Alternatives:
- Need to establish criteria for evaluation, features the buyer wants or does not
want. Rank...
6-Post-Purchase Evaluation:
In the context of attracting and retaining customers, post-purchase
evaluation is the connecti...
5- Customer Satisfaction?
Satisfaction is a person’s feelings of pleasure resulting from comparing a
product’s actual perf...
Cont’d
Customer Satisfaction and Customer Retention
• Customer satisfaction is the key to customer retention
• Fully satisfies cu...
1 in 4 unhappy
Customers
switch

1 in 27 unhappy
customers
complain

1 Unhappy Customer Can Turn to 27 Unhappy Customers
6- Role of Marketing
1.

The stimulation of problem recognition by product information.

2.

The provision of sources of i...
Marketing management topic 3
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  • A drive is a strong internal stimulus that calls for action. A drive becomes a motive whenit is directed toward a particular stimulus object. For example, a person’s drive for self actualizationmight motivate him or her to look into buying a camera. The consumer’sresponse to the idea of buying a camera is conditioned by the surrounding cues. Cues areminor stimuli that determine when, where, and how the person responds. For example, theperson might spot several camera brands in a shop window, hear of a special sale price, ordiscuss cameras with a friend. These are all cues that might influence a consumer’s responseto his or her interest in buying the product.Suppose the consumer buys a Nikon camera. If the experience is rewarding, the consumerwill probably use the camera more and more, and his or her response will bereinforced. Then the next time he or she shops for a camera, or for binoculars or some similarproduct, the probability is greater that he or she will buy a Nikon product. The practicalsignificance of learning theory for marketers is that they can build up demand for aproduct by associating it with strong drives, using motivating cues, and providing positivereinforcement.
  • Actual purchasing is only one stage of the process. Not all decision processes lead to a purchase. All consumer decisions do not always include all 6 stages, determined by the degree of complexityN.B : The degree of complexity of the product has an impact on the buying process. Buying soap is not like buying a car.Sources of Problem RecognitionOut of stocks: routine Dissatisfaction: State of affairs / product or service New Needs / wants Related products / purchases: cars / cameras.Marketer New products: new technology, new features.
  • Post-purchase evaluation: customers will experience one of those outcomes:delight: the product’s performance exceeds the customer’s expectations.Satisfaction: the product’s performance matches the customer’s expectations.Dissatisfaction:the product’s performance falls short of the customer’s expectations.Cognitive dissonance(post-purchase doubt): the customer is unsure of the product’s performance relative to their expectations.
  • -Customer retention : is repeat customers or people who buy from you again and again and to ensure that make him feel happy .- Any business without a focus on customer satisfaction is at the mercy of the market .Without loyal customers eventually a competitor will satisfy those desires and your customer retention rate will decrease.
  • Marketing management topic 3

    1. 1. Consumer Buying Behavior Consumer Buying Behavior & Decision Making & Decision Making
    2. 2. Lecture 3 - Contents 1. Introduction 2. What is Consumer Buying Behavior. 3. Factors Influencing Consumer Behavior 4. The Buyer Decision Process 5. Customer Satisfaction. 6. Role of Marketing
    3. 3. 1- Introduction • Consumer OR Customers? • Main Questions to answer? – Who buys? – How do they buy? – When do they buy? – Where do they buy? – Why do they buy? • Why it is important?
    4. 4. 2- What Is Consumer Behavior? The process & activities people engage in when searching for, selecting , purchasing, using, evaluating & disposing of products, so as to satisfy their needs & desires.
    5. 5. Model of Buyer Behavior Marketers want to understand how the stimuli are changed into responses inside the consumer’s black box
    6. 6. “There is only one boss THE CUSTOMER And he can fire anyone , simply by spending his money Somewhere else” -Sam Walton, Founder of WalMart
    7. 7. 3- Factors Influencing Consumer Behavior • Cultural Factors • Social Factors • Personal Factors • Psychological Factors
    8. 8. Factors Influencing Consumer Behavior
    9. 9. 1. Cultural Factors: • Culture is the set of basic values, perceptions, wants, and behaviors learned by a member of society from family and other important institutions. • A child in the United States normally learns or is exposed to the following values: individualism, freedom, hard work, activity and involvement, efficiency and practicality, youthfulness, and fitness and health • Marketers are always trying to spot cultural shifts so as to discover new products that might be wanted
    10. 10. Subculture: A group of people with shared value systems based on common life experiences and situations. •Each culture contains smaller subcultures •Examples of four such important subculture groups in USA include Hispanic American (50 million), African American (42 million), Asian American (15 million)
    11. 11. Social class Social classes: are society’s relatively permanent and ordered divisions whose members share similar values, interests, and behaviors. • Social class is not determined by a single factor, such as income, but is measured as a combination of occupation, income, education, wealth, and other variables.
    12. 12. The Major American Social Classes
    13. 13. Factors Influencing Consumer Behavior
    14. 14. 2. Social Factors Reference Groups and opinion leaders • Reference group: An actual or imaginary group conceived of having significant relevance upon an individual’s evaluation, aspirations, or behaviors. • Marketers try to identify the reference groups of their target markets • Opinion leader: A person within a reference group who, because of special skills, knowledge, personality, or other characteristics, exerts social influence on others. • Marketers try to identify opinion leaders for their products and direct marketing efforts toward them Cont’d
    15. 15. Family • The family is the most important consumer buying organization in society • In the United States, the wife traditionally has been the main purchasing agent for the family in the areas of food, household products, and clothing. • But with 70 percent of women holding jobs outside the home and the willingness of husbands to do more of the family’s purchasing, all this is changing.
    16. 16. Factors Influencing Consumer Behavior
    17. 17. 3. Personal Factors A buyer’s decisions also are influenced by personal characteristics such as the buyer’s age and life-cycle stage, occupation, economic situation, lifestyle, and personality and self-concept. Age and Life-Cycle Stage • People change the goods and services they buy over their lifetimes. Tastes in food, clothes, furniture are often age related. • Buying is also shaped by the stage of the family life cycle—the stages through which families might pass as they mature over time. • Lifestage changes usually result from demographics and life-changing events—marriage, having children, purchasing a home, divorce, children going to college, changes in personal income, moving out of the house, and retirement
    18. 18. Occupation A person’s occupation affects the goods and services bought. • Blue-collar workers end to buy more rugged work clothes, whereas executives buy more business suits. Economic Situation • A person’s economic situation will affect his or her store and product choices. • Marketers watch trends in personal income, savings, and interest rates. • Following the recent recession, most companies have taken steps to redesign, reposition, and reprice their products. Lifestyle • Lifestyle: it is the person’s pattern of living as expressed in his or her activities, interests, and opinions. • People coming from the same subculture, social class, and occupation may have quite different lifestyles. Personality and Self-Concept Personality: it is the unique psychological characteristics that distinguish a person or group.
    19. 19. Factors Influencing Consumer Behavior
    20. 20. 4- Psychological Factors A person’s buying choices are further influenced by four major psychological factors: • • • • Motivation Perception Learning Beliefs
    21. 21. Motivation Motive: A need that is sufficiently pressing to direct the person to seek satisfaction of the need. A need becomes a motive when it is aroused to a sufficient level of intensity • Psychologists have developed theories of human motivation. • Two of the most popular—the theories of Sigmund Freud and Abraham Maslow— have quite different meanings for consumer analysis and marketing. • Sigmund Freud assumed that people are largely unconscious about the real psychological forces shaping their behavior.
    22. 22. Perception Perception: it is the process by which an individual selects, organizes and interprets information inputs to produce a meaningful picture. People can form different perceptions of the same stimulus because of three perceptual processes: selective attention, selective distortion, and selective retention Interestingly, although most marketers worry about whether their offers will be perceived at all, some consumers worry that they will be affected by marketing messages without even knowing it—through subliminal advertising
    23. 23. Learning When people act, they learn. Learning describes changes in an individual’s behavior arising from experience. Beliefs Belief: is a descriptive thought that a person holds about something. Marketers are interested in the beliefs that people formulate about specific products and services because these beliefs make up product and brand images that affect buying behavior.
    24. 24. 4- The Buyer Decision Process 1- Problem Recognition (awareness of need): Difference between the desired state and the actual condition. Hunger--Food. Hunger stimulates your need to eat. 2-Information search: - Internal search, memory and experience. - External search if you need more information. Friends and relatives (word of mouth). Marketer dominated sources; comparison shopping; public sources etc.
    25. 25. 3-Evaluation of Alternatives: - Need to establish criteria for evaluation, features the buyer wants or does not want. Rank/weight alternatives or resume search. 4-Purchase decision: Choose buying alternative, includes product, package, store, method of purchase.. 5-Purchase: -The key issue for marketers during the purchase stage are product availability as its critical. - Without it, customers will not purchase from you but will find someone else who can deliver the product.
    26. 26. 6-Post-Purchase Evaluation: In the context of attracting and retaining customers, post-purchase evaluation is the connection between the buying process and the development of long term customer relationships.
    27. 27. 5- Customer Satisfaction? Satisfaction is a person’s feelings of pleasure resulting from comparing a product’s actual performance to his/her expectations about that product. “It is no longer enough to satisfy customers. You must delight them.” - Philip Kotler Cont’d
    28. 28. Cont’d
    29. 29. Customer Satisfaction and Customer Retention • Customer satisfaction is the key to customer retention • Fully satisfies customers are more likely to become loyal customers. • Customer satisfaction is a big challenge for marketers. Cont’d
    30. 30. 1 in 4 unhappy Customers switch 1 in 27 unhappy customers complain 1 Unhappy Customer Can Turn to 27 Unhappy Customers
    31. 31. 6- Role of Marketing 1. The stimulation of problem recognition by product information. 2. The provision of sources of information to help people formulated alternatives. 3. To influence the evaluation process. 4. Marketing mix influences are seller’s efforts to influence the buyer decision making process. 5. Situation influences are influences that come from the buying situation itself. 6. Point of purchasing displays and personal selling are used to clinch the deal.

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