Consumer modeling girish mude

Consumer Modeling
Prof. Girish Mude
MAEER’s MIT School of Management, Pune
girishmude@mitsom.com

Consumer Modeling
• Model is very often referred to as an abstract
representation of a process of relationship.
• How they help:
– In development of theories
– To understand complex relationship
– Provide framework for discussions and research
work.
Girish Mude MITSOM, Pune
Lets study Models then….

Models

Models in consumer Behavior
• Psychoanalytical model
• Economic model
• Sociological model
• Howard Seth model
• Nicosia model
• Engel Blackwell model
• VALS2 Stadford model

The psychoanalytical model
The psychoanalytical model draws from Freudian
psychology
Individual consumer has a complex set of deep
seated motives which drive him towards certain
buying decisions.
The buyer has a private world with all his hidden
fears, suppressed desires and totally subjective
longings.
His buying action can be influenced by appealing
to those desires and longings.

According to Mr.
Freud, human
personality has
three parts namely,
1. the “ID”, the
source of all mental
energy which drives
one to an action.
2.the “Super Ego”,
the internal
representation of
what is socially
approved—one’s
conscience.
3. the “Ego”, the
conscious director
of ‘ID’ impulses for
finding satisfaction
in socially
acceptable manner.

In other words, ‘ID’ represents one’s animal or
basic impulses, ‘instincts’ and cravings for
immediate and total satisfaction.
Marketers have been using this Approach to
generate new ideas for developing product-
design, features, advertising and promotional
techniques.

Example…
A person is interested in buying SONY TV with characteristics of Hi-black Trinitron
Screen—super drum sound system say Rs.1,05,000 with remote control.
Here his ‘ID’ demands the use of consumer credit liberally to buy that costly T.V.
set.
The Super Ego dissuades him from heavy borrowing as credit beyond certain
limits is not acceptable.
Here the Ego acts like a mediator and comes with a fine compromise of
installment system without away strains and drain on his financial position.
Here self image of a consumer is a great motivating force inducing him to buy
certain products.

Economic Model
It is assumed that man is a rational human being.
Evaluate all alternatives in terns of cost and value
received.
Select that product/service which gives maximum
satisfaction (utility).
With limited purchasing power consumer will
allocate their expenditure over different products.

Consumer
intention to
maximizing
utility/benefit.
• Price effect
• Substitute effect
• Income effect
Economic Model
is based on
certain prediction
of buying
behaviour

Sociological Model
Individual buyer
is part of society.
Gets influence
by it.
Play many roles
As a family
member
As an employee
As a member of
professional
forum

Influence by
Family
Friends
Close colleagues
Peer
group(Informal
Leader influence)
Similarly other
aspect also affect
buying pattern
Income
Occupation
Social class

Nicosia Model
Developed b Francesco M. Nicosia
in 1966
Attempts to establish linkages
between the marketing firm and its
consumer.
The essence is how the activities of
the firm influence the consumer
and result in his direction to buy.

Nicosia Model ..Continued
• His model lumps these activities into Four basic fields.
• Field One has two sub-fields namely, the firms attributes and the
consumer attributes. An ad message from the firm reaches
consumer’s attributes. Depending on the way the messages
received by the consumer, a certain attribute may develop and this
becomes the input for the field Two.
• Field Two is the area of search and evaluation of the advertised
product and other alternatives. If this process results in a
motivation to buy, it becomes the input for field three.
• Field Three consist of the act of purchase.
• The field Four consists of use of the purchased item. There is an
output from field Four --- feed back of sales results to the firm

Engel, Kollat, and Blackwell (EKB)
Model
The EKB model is comprehensive and
shows the components of decision
making and the relationships and
interactions among them.
The five distinct parts of consumer
decision making presented are:
• Input, information processing, a decision process,
decision process variables, and external
influences

One of the important features of the
Engel, Kollat, and Blackwell model is
the description of consumer
purchasing as a process comprised of
several stages rather than a single act
of buying or not buying.

Input
• Our experiences, contact with others
• Marketer-controlled stimuli (e.g.,
advertising, store display,
demonstrations)
• Other stimuli (e.g., personal
recollections, conversations with
friends)
• External search
Input
includes all
kinds of
stimuli from
our contact
with the
world
around us:

Information Processing
Stimuli are
processed into
meaningful
information
• Exposure
• Attention
• Comprehension
• Yielding
• Retention
Five methods
of information
processing:

Decision Process
It is triggered at
any time during
information
processing
• Problem recognition
• Search
• Alternative evaluation
• Choice
• Outcomes (post-purchase evaluation and behavior)
It consists of
five steps:

Decision Process Variables
Those individual
qualities that make
people/consumers
unique.
• Motives
• Beliefs
• Attitudes
• Lifestyles
• Intentions
• Evaluative criteria
• Normative compliance and informational influence
• Other aspects of self
Decision process
variables include

External Influences
Such influences are
called “Circles of Social
Influence.” They are:
culture, sub-culture
(co-culture), social
class, reference
groups, and family or
household influences

This model is an individual decision
process model since it views a single
consumer as the basic decision
making unit. The model does
recognize influences from other
people, but the central focus is still on
the individual.

VALS2 Stadford model
VALS-2 was developed by the US
consulting firm Stanford Research
Institute (SRI) as an improvement on its
original VALS (introduced in 1978), a
system that divided people into three
basic lifestyle groups (Need driven,
Outer directed, and Inner directed).

VALS 2 (VALUES AND LIFESTYLES
SYSTEMS) -- Basic Categories
• Principle - oriented: guided by their view
of how the world should be
• Status - oriented: guided by actions and
opinions of others
• Action - oriented: guided by desire for
social or physical activity, variety,
risk-takingGirish Mude MITSOM, Pune

VALS 2: Available Resources Relevant
to Psychographic Profiles
• Education
• Income
• Health
• Energy Level
• Self Confidence
• Degree of Consumerism

Fulfilleds
Believers
Actualizers
Achievers
Strivers
Strugglers
Experiencers
Makers
Abundant
Resources
Minimal
Resources
Values and Lifestyles 2 (VALS 2)
(Stanford Research Institute)
Principle-
Oriented
Status-
Oriented
Action-
Oriented

• Eight basic lifestyle groups on the basis of two
dimensions: resources and self-orientation.
• Resource dimension includes education, income,
intelligence, health, energy level, and eagerness to
purchase resources that, in general, increase from
youth to middle age decline afterwards.
• Self-orientation is divided into three parts (1)
Principle oriented: having set views. (2) Status
oriented: influenced by other's thinking. (3) Action
oriented: seeks activity, adventure, and variety.
•

• The eight basic lifestyle groups are (1)
Actualizers, (2) Fulfillers, (3) Believers, (4)
Achievers, (5) Strivers, (6) Experiencers, (7)
Makers, and (8) Strugglers.

• VALS2 used self-orientation to capture three different ways of
buying for the lifestyle classifications.
• Principle-oriented consumers (fulfilleds and believers) were
grouped based on their views regarding how the world is or
how it should be;
• Status-oriented consumers (actualizers, achievers, strivers,
and strugglers) were grouped based on their view regarding
the actions and opinions of others; and
• Action oriented consumers (experiencers and makers) were
grouped based on a desire for social or physical activity,
variety, and risk-taking (Riche, 1989).

Any Questions ???

Thank You !!!

Consumer modeling girish mude

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