On October 23rd, 2014, we updated our
By continuing to use LinkedIn’s SlideShare service, you agree to the revised terms, so please take a few minutes to review them.
Ba7a6decision making processPresentation Transcript
Consumer Behaviour (CB)CB is defined as the behaviour that consumer display in “searching for, purchasing,using, evaluating and disposing of products and services that they expect will satisfy theirneeds. CB focuses on now individuals make decisions to spend their available resources(time, money, effort) on consumption related items. That includes:•What they buy•Where they buy•Why they buy•When they buy it•How often they buy•How often they use it•How they evaluate it after the purchase•Impact of these evaluations on future purchase•How they dispose of itCB describes two different kinds of consuming entities:•Personal consumer•Organizational consumer (project & non project org. govt. agenties institutions i.e.school, hospitals, prisons etc.)
Demographics– are statistics that measure observable aspects of a population such asbirthrate, age, gender, income etc. one of the most important segment for the marketer.Lifestyle and Psychographic Segmentation– Lifestyle is basically now a person lives.It is now one enacts his/her self concept. It is determined by the persons pastexperiences, innate characteristics and current situations.Psycho (mental) Graphic (profiling) may be viewed as the method of defining lifestyle inmeasurable terms. It is the systematic use of relevant activity, interest and opinionconstructs to quantitatively explore and explain the communicating, purchasing andconsuming behaviours of persons for brands, products and cluster of products.Psychographic (including lifestyles) and demographic profiles are highly complementaryapproaches that work best when used together. By combining the knowledge marketersare provided with powerful information about tgt segment.Lifestyle Marketing– Lifestyle frequently provides the basic motivation and guidelines forpurchases, although it does so in an indirect and subtle manner.
Lifestyle and the consumption processLifestyle Determinants Lifestyle Impact on Behaviour• Demographics How we live Purchases• Subculture • Activities • How• Social class • Interests • When• Motives • Likes/Dislikes • Where• Personality • Attitudes • What• Emotions • Consumptions • With whom• Values • Expectations Consumption• Household life cycle • Feelings • Where• Culture • With whom• Past experience • How • When • What
Measurement of Lifestyle–• Attitude – Evaluative statement about other people, places, ideas, products etc.• Values – Widely held beliefs about what is acceptable/desirable.• Activities & Interests – Non-occupational behaviour to which consumes devote timeand effort e.g. hobbies, sports, public service.The Technique of Lifestyle Segmentation–Lifestyle segmentation measure (i) how people spend their time engaging in activities (ii)what is of most interest/important to them in their immediate surroundings (iii) theiropinion and views about themselves and world around them (AIOS).
Lifestyle Dimensions Activities Interests Opinions DemographicsWork Family Themselves AgeHobbies Home Social issues EducationSocial events Job Politics IncomeVacation Community Business OccupationEntertainment Recreation Economics Family sizeClub Member Fashion Education Dwelling (house to live-in)Community Food Products GeographyShopping Media Future City sizeSports Achievements Culture Stage in lifecycle
Demographics– age, education, income, occupation, family structure, gender,geographic location.• Media pattern – the specific media the consumers utilize.• Usage Rates – measurement of consumption within a specified port category; oftenconsumers are characterized as heavy, medium, light or nonusers.VALS – Introduced in 1978 VALS (Values & Lifestyles) given by SRI Consulting BusinessIntelligences is the most popular application of psychographic research by marketingmanagers.SRIC – BI has identified there primary self orientations.• Principle Oriented – These individuals are guided in their choices by their beliefs andprinciples rather than by feelings, events or desire for approval.• Status oriented – The actions, approval and opinion of others heavily influence theseindividuals.Experiences and Makers : Action OrientedExperiences – are young, vital, enthusiastic, impulsive and rebellious. They seek varietyand excitement, savoring the new, the offbeat and the …..Makers – are practical people who have constructive skills and value self sufficiency.They live within a traditional context of family, practical work and physical recreation andhave little interest in what lies outside that context.
Actualizers/Innovation – are successful, sophisticated active, take charge people withhigh self esteem and abundant resources. They are interested in growth and seek todevelop, explore and express themselves in a variety of ways.Strugglers/Survivors – Their lives are constricted. They are poor with limited educationand skills, without strong social bonds, frequently elderly and concerned about theirhealth they are often resigned and passive.Action Oriented – These individual desire social or physical activity, variety and risktaking.Fulfields and believers: Principle orientedFulfields – are mature, satisfied, comfortable, reflective people who value order,knowledge and responsibility. They are well educated and are in professional occupation.Believers – are conservative, conventional people with concrete beliefs based ontradition established codes: family, community, church & the nation.Achievers & strivers: Status orientedAchievers – they are successful career and work oriented people who like to andgenerally do, feel in control of their lives. They value consensus, predictability andstability over risk, intimacy and self discovery.Strivers – they seek motivation, self definition and approval from the world around them.
They are striving to find a secure place in life. They are concerned about opinion andapproval of others, environmental factors affecting consumers.They are of two types:1. Internal variables– They comprise of factors that are present within the consumers.– They differ with individuals.They include:• Motivation• Perceptions• Learning• Beliefs• Values• Customer & attitude• Personality2. External variables: They are present outside the customer and influences his buyingbehaviour. They include:• Consumer culture• Social factors• Reference grp• Family & roles• Status
Decision-Making Process – A decision is the selection of an action from two or morealternative choices.Buying Roles:1. Initiator – A person who first suggests the idea of buying the part/service.2. Influencer – A person whose view/advice infevers the decision.3. Decider – A person who decides on any component of a buying decision – where tobuy, how to buy etc.4. Buyer – The person who makes the actual purchase.5. User – A person who consumes/uses the pelt/service.Buying Behaviour – Consumer decision-making varies with the type of buying decision.Atypes of consumer behavior has been identified based on the degree of involvement andthe degree of differences amongst the brands.
High Involvement Low Involvement Complex Buying Variety seeking buying behaviours Behaviour (e.g. cookies, dominated by) (expensive, bought infrequently, Significant risky, highly self expressive e.g. difference car, laptop, house)between brands Dissonance reducing Habitual buying Buying Behaviour BehaviourFew differences e.g. carpet (e.g. salt) (brand familarity leads tobetween brands (First acted, then acquired new purchase) beliefs, then set of attitude)
Levels of Consumer Decision-Making(i) Extensive Problem Solving – When consumers have no established criteria forevaluating a pelt category or specific brands in that category or have not narrowed theno.. Of brands they will consider to a small manageable subset, their decision-makingefforts can be classified as extensive problem solving.(ii) Limited Problem Solving – At this level of problem solving, consumers already haveestablished the basic criteria for evaluating the pelt category and the various brands inthe category. However they have not fully established preferences concerning a selectgroup of brands.(iii) Routinized Response Behaviour – At this level consumers have experience withthe pelt category and a well established set of criteria with which to evaluate the brandsthey are considering. In some situations they may search for a small amt. of additionalinformation in others they simply review what they already know.Models of consumers: Four views of Consumer Decision Making:(i) An Economic View – In this the consumer has been characterized as making rationaldecisions.(ii) A Passive View – Opposite to rational economic view of consumers is the passiveview that depicts the consumer as basically not submissive to the self servicing interestsand promotional efforts of marketer.
(iii) A Cognitive View – It potrays the consumer as thinking problem solver. This modelfocuses on the process by which consumers seek and evaluate information aboutselected brands and retail outlet.(iv) An Emotional View – Consumer can be a emotional or impulsive buyer and is likelyto associate deep feelings or emotions as joy, fear, love, hope, fantasy with certainpurchases/possessions.
Problem Recognition Information Search Evaluation of Alternatives Purchase Decision Post Purchase BehaviourFive Stage Model of Consumer Buying Behaviour
Firms Marketing External Influence Efforts Socio-cultural Env. • Product • Family Input • Promotion • Informal Sources • Price • Non comm. sources • Social class • Channel of ……. • Subculture/culture Consumer Decision-Making Need Recognition Psychological Field • MotivationProcess Prepurchase search • Perception • Learning Evaluation of • Personality Alternatives • Attitude Experience Post-purchase behaviour Purchase • Trial • Repeat purchase Output Model of Post-purchase consumer evaluation decision making
CULTURAL SOCIAL PERSONAL• Culture PSYCHOLOGICAL • Age & life • Reference cycle stage • Motivation Group • Occupation • Perception BUYER• Subculture • Lifestyle • Learning • Personality & • Beliefs & Attitudes • Family self concept • Economic• Social class • Roles & circumstances Statuses Factors Influencing Consumer Behaviour
An Overview of Problem RecognitionHow consumers fell Process & factors of His expectations from theabout the product problem recognition composition of a new productExisting consumer Desired consumerposition position Perceived gap/ Discripancy tensionContributed by (Threshold level problem) Stock out Problem recognition Recognition of new need situation Dissatisfaction with Every gap does not cross the present stock threshold level. Marketers Generation of new wants increase the gap and increase Availability of new pelt offering the tension level so that Enhancement in funds purchase can be made. Changing environmental circumstances Marketing efforts
Types of Problem Recognition Immediacy of SolutionExpectancy of Immediate Solution Immediate Solution Problem Required not RequiredOccurance of Routine PlanningProblem ExpectedOccurance of Emerging EvolvingProblem unexpected
Information sources for a purchase decision Information sources Internal External Information Information Actively Acquired Passively Acquired Actively Acquired Past Personal Low involvement Searches experience learning Independent Personal contacts Marketer Experimental Groups InformationMagazines, consumer Friends/Family Sales person website (Pdt inspection/groups and govt. advt. pdt trial)agencies
All Brands Known Brands Unknown brands (1) Evolved set Inept set Inert set Acceptable Unacceptable Indifferent Over-looked Brands Brands Brands Brands (2) (3) (4) NotPurchased Purchased Brands Brand (4) (5)
All Brands Known Brands Unknown brands (1) Evolved set Inept set Inert set Acceptable Unacceptable Indifferent Over-looked Brands Brands Brands Brands (2) (3) (4) NotPurchased Purchased Brands Brand (5)
How Consumer Use or Dispose of Products Rent it Get rid of it temporarily Lend it Rent it Lend it Give it Trade it Direct to consumerProduct Get rid of it permanent Through middleman Sell it Throw it away To intermediary Use it to serve original purpose Keep it Convert it to serve new purpose Store it
Product valueServices value TotalPersonal Customer value value Image value Customer DeliveredMonetary Value cost Time cost Total Customer Energy cost costPsychic cost
Models of Consumers – Three views of consumer decision making:The term “models of consumers” refer to a general view/perspective as to how (and why) individuals behave as they do.(iii) Economic view(iv) Passive view(v) Cognitive view