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  • 1. Consumer Decision Making
  • 2. Learning Objectives 1. Explain why marketing managers should understand consumer behavior. 2. Analyze the components of the consumer decision-making process. 3. Explain the consumer’s postpurchase evaluation process.
  • 3. Learning Objectives (continued) 4. Identify the types of consumer buying decisions and discuss the significance of consumer involvement. 5. Identify and understand the cultural factors that affect consumer buying decisions.
  • 4. Learning Objectives (continued) 6. Identify and understand the social factors that affect consumer buying decisions. 7. Identify and understand the individual factors that affect consumer buying decisions. 8. Identify and understand the psychological factors that affect consumer buying decisions.
  • 5. Learning Objective Explain why marketing managers should understand consumer behavior.
  • 6. Consumer Behavior Processes a consumer uses to make purchase decisions, as well as to use and dispose of purchased goods or services; also includes factors that influence purchase decisions and the product use.
  • 7. Learning Objective Analyze the components of the consumer decision-making process.
  • 8. Consumer Decision-Making Process A five-step process used by consumers when buying goods or services.
  • 9. Consumer Decision-Making Process Postpurchase Behavior Purchase Evaluation of Alternatives Information Search Need Recognition Cultural, Social, Individual and Psychological Factors affect all steps
  • 10. Need Recognition Result of an imbalance between actual and desired states.
  • 11. Need Recognition Internal Stimuli and External Stimuli Present Status Preferred State Marketing helps consumers recognize an imbalance between present status and preferred state
  • 12. Stimulus
    • Any unit of input affecting one or more of the five senses:
    • sight
    • smell
    • taste
    • touch
    • hearing
  • 13. Want Recognition of an unfulfilled need and a product (or attribute or feature) that will satisfy it.
  • 14. Recognition of Unfulfilled Wants
    • When a current product isn’t performing properly
    • When the consumer is running out of an product
    • When another product seems superior to the one currently used
  • 15. Information Searches Process of recalling past information stored in the memory. Internal Process of seeking information in the outside environment. External
  • 16. Information Search
    • External Information search
      • Seek information in outside environment
        • Non-marketing controlled
        • Marketing controlled
    • Internal Information Search
      • Recall information in memory
  • 17. External Information Searches Need More Information More Risk Less knowledge Less product experience High level of interest Less Risk More knowledge More product experience Low level of interest Need Less Information
  • 18. Evoked Set Group of brands, resulting from an information search, from which a buyer can choose.
  • 19. Evaluation of Alternatives Evoked Set Purchase! Evaluation of Products Analyze product attributes Use cutoff criteria Rank attributes by importance
  • 20. Purchase Determines which attributes are most important in influencing a consumer’s choice To buy or not to buy... Marketing
  • 21. Learning Objective Explain the consumer’s postpurchase evaluation process.
  • 22. Cognitive Dissonance Inner tension that a consumer experiences after recognizing an inconsistency between behavior and values or opinions.
  • 23. Postpurchase Behavior Can minimize through: Effective Communication Follow-up Guarantees Warranties Marketing Cognitive Dissonance ? Did I make a good decision? Did I buy the right product? Did I get a good value?
  • 24. Learning Objective Identify the types of consumer buying decisions and discuss the significance of consumer involvement.
  • 25. Types of Consumer Buying Decisions More Involvement Less Involvement Routine Response Behavior Limited Decision Making Extensive Decision Making
  • 26. Five Factors influencing Decisions
    • 1. Level of consumer involvement
    • 2. Length of time to make decision
    • 3. Cost of good or service
    • 4. Degree of information search
    • 5. Number of alternatives considered
  • 27. Routine Response Behavior
    • Little involvement in selection process
    • Frequently purchased low cost goods
    • May stick with one brand
    • Buy first/evaluate later
    • Quick decision
  • 28. Limited Decision Making
    • Low levels of involvement
    • Low to moderate cost goods
    • Evaluation of a few alternative brands
    • Short to moderate time to decide
  • 29. Extensive Decision Making
    • High levels of involvement
    • High cost goods
    • Evaluation of many brands
    • Long time to decide
    • May experience cognitive dissonance
  • 30. Level of Involvement Situation Social Visibility Interest Perceived Risk of Negative Consequences Previous Experience Factors Determining Level of Involvement
  • 31. Marketing Implications of Involvement
    • High-involvement purchases require:
    • extensive promotion to target market and
    • good advertisement
    • Low-involvement purchases require: in-store promotion and eye-catching package design
  • 32. Factors Influencing Buying Decisions Social Factors Individual Factors Psycho- logical Factors Cultural Factors CONSUMER DECISION- MAKING PROCESS BUY / DON’T BUY
  • 33. Learning Objective Identify and understand the cultural factors that affect consumer buying decisions.
  • 34. Culture Set of values norms, attitudes, and other meaningful symbols that shape human behavior and the artifacts, or products, of that behavior as they are transmitted from one generation to the next.
  • 35. Cultural Influences on Buying Decisions Values Language Myths Customs Rituals Laws Components of American Culture Material Artifacts
  • 36. Culture is... Learned Functional Pervasive Dynamic 5
  • 37. Value Enduring belief that a specific mode of conduct is personally or socially preferable to another mode of conduct. 5
  • 38. Core American Values Success Materialism Freedom Progress Youth Capitalism Core American Values
  • 39. Global Language Blunders
    • Chevrolet’s “Nova” translated to “No Go”
    • Coors “Turn it Loose” became “Suffer from Diarrhea”
    • Toyota’s MR2 sounded like a swearword in French
    • Coca-Cola in Chinese means “bite the wax tadpole”
  • 40. Subculture A homogeneous group of people who share elements of the overall culture as well as unique elements of their own group.
  • 41. Social Class A group of people in a society who are considered nearly equal in status or community esteem, who regularly socialize among themselves both formally and informally, and who share behavioral norms.
  • 42. Learning Objective Identify and understand the social factors that affect consumer buying decisions.
  • 43. Social Influences Reference Groups Opinion Leaders Family Members Social Influences on Buying Decisions
  • 44. Reference Group A group in society that influences an individual’s purchasing behavior. 6
  • 45. Reference Groups Direct Indirect Types of Reference Groups Primary Secondary Aspirational Non-aspirational
  • 46. Implications of Reference Groups
    • They serve as information sources and influence perceptions
    • They affect an individual’s aspiration levels
    • Their norms either constrain or stimulate consumer behavior
  • 47. Opinion Leaders An individual who influences the opinion of others.
  • 48. Family Purchase Roles in the Family
    • Instigators
    • Influencers
    • Decision-Makers
    • Purchasers
    • Consumers
    Children Influence Purchase Decisions
  • 49. Learning Objective Identify and understand the individual factors that affect consumer buying decisions.
  • 50. Individual Influences Gender Age Family Life Cycle Personality Self-Concept Lifestyle Individual Influences
  • 51. Psychographics The analytical technique used to examine consumer lifestyles and to categorize consumers. 7
  • 52. “Types of Moms” “ Strong Shoulders” Moms “ Tug-of-War” Moms “ June Cleaver” Moms “ Mothers of Invention” Moms
  • 53. Learning Objective Identify and understand the psychological factors that affect consumer buying decisions.
  • 54. Psychological Influences Psychological Influences on Buying Decisions Perception Motivation Learning Beliefs & Attitudes
  • 55. Perception Process by which people select, organize, and interpret stimuli into a meaningful and coherent picture.
  • 56. Perception Selective Exposure Selective Distortion Selective Retention
  • 57. Perception Selective Exposure Selective Distortion Consumer notices certain stimuli and ignores others Consumer changes or distorts information that conflicts with feelings or beliefs Selective Retention Consumer remembers only that information that supports personal beliefs
  • 58. A Consumer’s Selective Exposure Notices only 11 to 20 ads Exposure to over 250 advertisement messages per day
  • 59. Marketing Implications of Perception
    • Important attributes
    • Higher price
    • Brand names
    • Quality and reliability
    • Threshold level of perception
    • Product changes
  • 60. Maslow’s Hierarchy of Needs A method of classifying human needs and motivations into five categories in ascending order of importance.
  • 61. Motivation Maslow’s Hierarchy of Needs Physiological Safety Social Esteem Self- Actualization
  • 62. Learning A process that creates changes in behavior, immediate or expected, through experience and practice.
  • 63. Types of Learning Types of Learning Description Experiential Conceptual An experience changes behavior Not learned through direct experience
  • 64. Stimulus Generalization A form of learning that occurs when one response is extended to a second stimulus similar to the first.
  • 65. Beliefs and Attitudes An organized pattern of knowledge that an individual holds as true about his or her world. Belief Attitude A learned tendency to respond consistently toward a given object.