The document discusses key concepts related to consumer decision making and behavior. It covers the consumer decision making process, which includes need recognition, information search, evaluation of alternatives, purchase, and post-purchase evaluation. It also outlines various factors that influence consumer decisions, such as cultural, social, individual, and psychological factors. Finally, it provides learning objectives that explain why marketers should understand consumer behavior and identify the different types of consumer decisions and levels of involvement.

1. Consumer Decision Making chapter 4

2. Learning Objectives chapter 4 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) chapter 4 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) chapter 4 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 1 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. 1

7. Learning Objective 2 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. 2

9. Consumer Decision-Making Process 2 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. 2

11. Need Recognition 2 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 2

13. Want Recognition of an unfulfilled need and a product (or attribute or feature) that will satisfy it. 2

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 2

15. Information Searches Process of recalling past information stored in the memory. Internal Process of seeking information in the outside environment. External 2

16. Information Search External Information search Seek information in outside environment Non-marketing controlled Marketing controlled 2 Internal Information Search Recall information in memory

17. External Information Searches 2 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. 2

19. Evaluation of Alternatives 2 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 2

21. Learning Objective Explain the consumer’s postpurchase evaluation process. 3

22. Cognitive Dissonance Inner tension that a consumer experiences after recognizing an inconsistency between behavior and values or opinions. 3

23. Postpurchase Behavior 3 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. 4

25. Types of Consumer Buying Decisions More Involvement Less Involvement Routine Response Behavior Limited Decision Making Extensive Decision Making 4

26. Involvement and Decision Making High Involvement Extended Problem Solving eg buying a car, computer Limited Problem Solving eg buying clothes Low Involvement Habitual Decision Making eg buying soft drinks

27. 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 4

28. Routine Response Behavior Little involvement in selection process Frequently purchased low cost goods May stick with one brand Buy first/evaluate later Quick decision 4

29. Limited Decision Making Low levels of involvement Low to moderate cost goods Evaluation of a few alternative brands Short to moderate time to decide 4

30. Extensive Decision Making 4 High levels of involvement High cost goods Evaluation of many brands Long time to decide May experience cognitive dissonance

31. Level of Involvement 4 Situation Social Visibility Interest Perceived Risk of Negative Consequences Previous Experience Factors Determining Level of Involvement

32. 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 4

33. Factors Influencing Buying Decisions 4 Social Factors Individual Factors Psycho- logical Factors Cultural Factors CONSUMER DECISION- MAKING PROCESS BUY / DON’T BUY

34. Learning Objective Identify and understand the cultural factors that affect consumer buying decisions. 5

35. 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. 5

36. Cultural Influences on Buying Decisions 5 Values Language Myths Customs Rituals Laws Components of American Culture Material Artifacts

37. Culture is... Learned Functional Pervasive Dynamic 5

38. Value Enduring belief that a specific mode of conduct is personally or socially preferable to another mode of conduct. 5

39. Core American Values 5 Success Materialism Freedom Progress Youth Capitalism Core American Values

40. Global Language Blunders 5 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”

41. Subculture A homogeneous group of people who share elements of the overall culture as well as unique elements of their own group. 5

42. 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. 5

43. Learning Objective 6 Identify and understand the social factors that affect consumer buying decisions.

44. Social Influences Reference Groups Opinion Leaders Family Members Social Influences on Buying Decisions 6

45. Reference Group A group in society that influences an individual’s purchasing behavior. 6

46. Reference Groups Direct Indirect 6 Types of Reference Groups Primary Secondary Aspirational Non-aspirational

47. 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 6

48. Opinion Leaders An individual who influences the opinion of others. 6

49. Family Purchase Roles in the Family Instigators Influencers Decision-Makers Purchasers Consumers Children Influence Purchase Decisions 6

50. Learning Objective Identify and understand the individual factors that affect consumer buying decisions. 7

51. Individual Influences Gender Age Family Life Cycle Personality Self-Concept Lifestyle Individual Influences 7

52. Psychographics The analytical technique used to examine consumer lifestyles and to categorize consumers. 7

53. Learning Objective Identify and understand the psychological factors that affect consumer buying decisions. 8

54. Psychological Influences 8 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. 8

56. Perception Selective Exposure Selective Distortion Selective Retention 8

57. Perception 8 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 8

59. Marketing Implications of Perception Important attributes Higher price Brand names Quality and reliability Threshold level of perception Product changes 8

60. Maslow’s Hierarchy of Needs A method of classifying human needs and motivations into five categories in ascending order of importance. 8

61. Motivation 8 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. 8

63. Types of Learning 8 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. 8

65. Beliefs and Attitudes An organized pattern of knowledge that an individual holds as true about his or her world. 8 Belief Attitude A learned tendency to respond consistently toward a given object.