Consumer Behaviour Chapter 1 & Marketing

Copyright © 2014 Pearson Canada Inc.
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Chapter 1
An Introduction to Consumer Behaviour

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It is all about you!
• You are a business student, a friend and a
consumer with needs; making choices from
competing brands
• Demographics: gender, income, occupation
• Psychographics: lifestyle and personality

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What is Consumer Behaviour?
Consumer behaviour: the study of the processes
involved when individuals or groups select, purchase,
use, or dispose of products, services, ideas, or
experiences to satisfy needs and desires.

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Consumers Behaviour is a Process
• Consumer behaviour is more
that just a purchase.
• It involves the issues that
influence the consumer
before, during, and after the
purchase.

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Consumer Behaviour is a “Process”
FIGURE 1 - 1

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Consumers’ Impact on Marketing Strategy
• Understanding consumer behaviour is good
business
• This is because the marketing concept is all about
understanding consumer needs
• Data about consumers help marketers define the
market
• Understanding consumers can help the marketer
identify threats to a brand and opportunities for it

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Impact of Marketing Strategy
• Understanding consumer behaviour is good business
• Understanding people/organizations to satisfy consumers’
needs
• Knowledge and data about customers:
• Help to define the market
• Identify threats/opportunities in relation to a brand

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Demographics and Canadians
• Typical Canadian is a woman of 39.9 years of age
• Average Canadian worked 36.4 hours per week in
2011.
• The average income of a Canadian was $840 per
week in 2011
• In 2011 the typical household spent $14,997 on
shelter
• Average Canadian television viewing was 20.6 hours
per week in 2010

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Segmenting Consumers
Demographics: Statistics that measure observable
aspects of a population, such as:
• Age
• Gender
• Family Structure and Marital Status
• Social Class and Income
• Ethnicity
• Geography

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Segmenting Consumers: Lifestyles
• Psychographics:
• The way we feel about ourselves
• Our attitudes to things and others around us
• The things we value
• The things we do in our spare time

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Relationship Marketing
• Building lifetime relationships between brands and
customers…a bond
• Regular interaction with customers
• Giving them a reason to maintain a relationship
with the company
• Marketers significantly influence lifestyles and
consumption habits: combinations of Integrated
Marketing Communications, rewards, and social
media create strong loyalty

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Marketing and Culture
• Popular culture
• Both an inspiration and an influence
• Tweeting
• Movie heroes, product usage
• Spokescharacters
• Consumer generated content
• Opinions on brands and products
• Social networking

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The Meaning of Consumption
• People often buy products not for what they do, but
for what they mean
• Brands…
• …convey image/personality
• …help us to form bonds with others who share
similar preferences

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The Global Consumer
People united by common devotion to:
• Brand name consumer goods
• Movie stars
• Celebrities
• Ubiquitous networks (U-commerce)
• RFID tags – communication chips
• Companies are expanding overseas

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Virtual Consumers
• Impact of the Web on consumer behavior
• 24/7 shopping without leaving home
• Handheld devices & wireless communications
• Not just B2C, now C2C (consumer to consumer)
sharing interests around the world
• A new generation of digital natives
• Horizontal Revolution
• Culture of participation

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Marketing Ethics and Public Policy
• Business Ethics: To conduct business honestly and
ethically
• Rules of conduct that guide the marketplace
• Knowing right from wrong
• Various cultures and organizations may conduct
themselves differently in certain situations

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Ethical Standards of Conduct
• Prescribed code of ethics guidelines:
• Disclosure of substantial risks with a product
• Identifying added features that will increase the
cost
• Avoiding false or misleading advertising
• Avoiding selling or fundraising under the guise of
market research
• Think about it: Are you willing pay a bit more for fair
trade coffee that helps various cultures?

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Do Marketers Manipulate Consumers?
•Do marketers give people what they want or, do they tell
people what they should want?
•Are advertising and marketing necessary?
• Critics suggest we buy things we do not need, just
because we can
• Or are products designed to meet existing needs and
promotions simply communicate product availability?
•Marketer Space vs. Consumer Space
• Consumers are empowered of how, when and what
time they make their consumer decisions

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Public Policy and Consumerism
• Consumer welfare is protected at the federal,
provincial and municipal levels
• Regulation protects the consumer from unfair
business practices
• Consumers depend on governments to regulate and
police standards

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Consumer Activism and
Its Impact on Marketing
• Adbusters’ initiatives such as “buy nothing day” and
“Turn off TV week”
• Culture Jamming aims to disrupt efforts by the
corporate world in dominating our cultural
landscape
• Corporate Social Responsibility
• Cause-Related Marketing
• Green Marketing
• Social Marketing

Frog Box Example: Green-Marketing and
Cause Marketing
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Social Marketing
• Techniques to encourage positive behaviours such
as increasing literacy and discouraging dangerous
activities such as drunk drivers
• Non-profit organizations such as The United Way,
Big Brothers, and “Out of the Cold” are social
marketing efforts for the good of others
• Think about it: Have you worked for non-profit
groups to help those less fortunate?

The Dark Side of Consumer Behaviour
• Consumer addiction:
psychological dependency
on products or services
• Drinking alcohol, smoking
cigarettes, drugs
• Addiction to technology:
“Crackberry”
• Compulsive Consumption
• Gambling in Canada is an
example of compulsive
consumption
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Illegal Activities
• In North America a retail theft takes place every 5
seconds
• Shrinkage is the industry term for shoplifting and
employee theft
• Fraudulent abuse of exchange policies in retail
• Unethical activities include lying and taking credit
for someone else’s work
• Anti-consumption: product tampering, graffiti and
political protests where property is destroyed

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The Role of Consumer Research
• Primary Research
• When the data is collected by the researcher
specifically for the research question at hand, this
called primary research.
• Secondary Research
• When the marketer finds the information needed by
going to a pre-existing source of information
collected for another purpose. When the researcher
uses pre existing data to answer a new research
question this is called secondary research.

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Primary Research
• Survey Research
• Focus Groups
• Interviews
• Observational Research
• Qualitative Research
• Experimental Research

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Wheel of Consumer Behaviour

Consumer Behaviour Chapter 1 & Marketing

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