CONSUMER BEHAVIOR
AN
INTRODUCTION
The purpose of a business is to
create a customer.
Peter Drucker
The purpose of business is to
create and keep a customer.
Peter Drucker
In the factory we make cosmetics; in the
drugstore we sell hope.
- Charles Revson
No theater could sanely flourish until there
was an umbilical connection between what
was happening on the stage and what was
happening in the world.
- Kenneth Tynan
Consumer Behavior
What products do consumers buy?
What Brand do they buy?
Why do they buy it?
Where do they buy?
How often do they buy it?
Consumer Behavior - Definitions
Process a person goes thru when purchasing
and using products and services, including the
mental and social processes that precede and
follow these actions.
It not only involves specific actions taken by
individuals when buying and using products
and services, ----
but also all the social and psychological factors
that affect the same.
Consumer Behavior - Definitions
American Marketing Associations (AMA)
Consumer behavior is the dynamic interactions
between affect and cognition, behavior and the
environment by which human beings conduct
the exchange aspects of their lives.
CB is Dynamic
Involves interactions
Its about Exchanges.
Consumer Behavior Is Dynamic
Because the thinking, feelings and actions of
individual consumers, targeted consumer groups
and society at large are constantly changing.
Consumers and their environments are
constantly changing.
Internet has changed the way people search for
information, products and services.
PLC’s have shortened.
Companies will have to constantly innovate.
C B Involves Interactions
Interactions among people’s thinking, feelings
and actions and the environment.
Thus marketers need to understand what
products and services mean to customers,
what consumers do to purchase them & use
them and what influences, shopping, purchase
and consumption.
Knowledge about how these interactions
individuals / target markets will help marketers
to better satisfy them.
CB involves Exchanges
People give up something of value to others and
receive something in return.
Mostly involves people giving up something of
value to obtain products and services.
This is the exchange between buyers and
sellers.
Role of marketing in society is to help create
exchanges between buyers (consumers) and
sellers (marketers).
Response
S&D
Hierarchy Model Page:463
Kotlar
page 63
Different AIDA Hierarchy of Innovation – Communications
Stages Model Effects Model Adoption model Model
Awareness Exposure
Cognitive Attention Reception
Knowledge Awareness
Stage
Cognitive response
Interest Liking Interest
Affective Attitude
Stage
Intention
Desire Preference Evaluation
Trial
Behavior Behavior
Action Purchase
Stage
Adoption
Approaches To Study Of Consumer Behavior
APPROACHES DOMAINS OBJECTIVES PRIMARY METHODS
Understanding Depth Interviews
Interpretative Anthropology consumption and
its meaning Focus Groups
Psychology Explain consumer
Traditional Experiments
decision making
Sociology
behavior Surveys
Marketing Economics Math modeling
Predict Consumer
(as a) Science Statistics choice & behavior Simulation
Factors Influencing C.B. Page: 145
Kotlar
Cultural Social
Culture Reference Groups
Sub Culture Family
Social Class Role & Status
Psychological Personal
Motivation Age & Life Cycle Stage
Learning Occupation
Buyer Life Style
Perception Personality & self concept
Attitudes Economic Circumstances
TYPES OF BUYING BEHAVIOR
Low Buyer Involvement High
Few
Habitual Buying Dissonance
Behavior Reducing Buying
Behavior
Significant
Differences
Between Brands
Variety seeking Complex Buying
Buying Behavior Behavior
Many
Stimulus-Response Model of Buyer Behavior
External Stimuli The Buyer’s Black Box
Environmental Marketing Buyer Buyer Decision
factors factors Characteristics Process
Input Problem
Economic Product
Price recognition
Social Cultural
Political Advertising Information
Technological Distribution Social search
Personal Evaluation
Buy Decision Psychological Decision
Product Post Purchase
Brand Behavior
Output
Dealer
Quantity
Purchase Timing
OVERALL MODEL OF CONSUMER BEHAVIOUR
Experiences and Acquisitions
External Influences
Culture Decision process
Subculture
Demographics
Problem
Social Status
Recognition
Reference Groups
Family
Information
Marketing Activities Self-Concept Search
And
Needs
Lifestyle Desires Alternative Evaluation
Internal Influences
And Selection
Perception
Learning
Outlet Selection
Memory
And Purchase
Motives
Personality
Postpurchase
Emotions
Processes
Attitudes
Experiences and Acquisitions
CONSUMER BEHAVIOR – FRAME WORK
Sub - culture
Culture Information
processing
Learning &
memory
Problem recognition Social
Motivation &
Information Search Class
Involvement
Evaluation
Buying Process
Personal
Influences
Post Buy Behavior.
Reference
Attitudes Personality & Groups
Self concept
Family
Consumer move from Total Set
Total Set
Awareness Set
Consideration
set
Choice
Set
Buying Decision
CONSUMER MARKETS
& 144
CONSUMER BEHAVIOR
Factors Influencing Buyer Behavior
&
Stages Of The Buying Decision Process
Consumer Behavior
What products do consumers buy?
What Brands do they buy?
Why do they buy it?
Where do they buy?
How often do they buy it?
Consumer Behavior - Definitions
Process a person goes thru when purchasing
and using products and services, including the
mental and social processes that precede and
follow these actions.
It not only involves specific actions taken by
individuals when buying and using products
and services, ----
but also all the social and psychological factors
that affect the same.
Consumer Behavior - Definitions
American Marketing Associations (AMA)
Consumer behavior is the dynamic interactions
between affect and cognition, behavior and the
environment by which human beings conduct
the exchange aspects of their lives.
CB is Dynamic
Involves interactions
Its about Exchanges.
Stimulus-Response Model of Buyer Behavior
External Stimuli The Buyer’s Black Box
Environmental Marketing Buyer Buyer Decision
factors factors Input Characteristics Process
Economic Product Cultural Problem
Social Price recognition
Political Advertising Information
Technological Distribution Social
search
Evaluation
Buy Decision Personal
Decision
Product Post Purchase
Brand Psychological Behavior
Output
Dealer
Quantity
Purchase Timing
Factors Influencing C.B.
Personal
Age & Life
Social Psychological
Cultural Cycle Stage
Reference Motivation
Culture Occupation
Groups
Life Style Learning Buyer
Sub Culture Family
Personality & Perception
Social Class Role &
Self Concept
Social Status Attitudes
Economic
Circumstances
Culture & Sub Culture (Cultural factors)
Culture is the fundamental determinant of a
persons wants and behavior.
Factors picked up from childhood – values,
beliefs from family, religion and educational
institution, society etc.
Sub Culture: Provide more direct identification
and a strong socialization parameter.
Include geographic groups, racial groups,
nationalities, religion.
Page: 145
Kotlar
Cultural Factors - Social Class
Social stratification exists in almost all societies.
Earlier it used to take the rigid dimension of
caste system.
But now it’s the more liberal socio-economic
class system.
They are hierarchical and persons within the
same class tend to behave similarly.
Upper class, middle class, working class, poor
Occupation, Income & Education (determinants)
Social Factors – Reference Groups
Membership Groups
Primary groups -informal group
Secondary Groups- formal group
Aspirational Groups – a person hope to join
Dissociative Groups- a person rejects
Opinion leader is the person is the one who
provide informal advice in the factors related to
buying
Social Factors – Family and Role &
Status
Family is the most important consumer buying
organization (most influential primary reference
group)
Family of Orientation- parents and sibling
Family of Procreation-one’s spouse, children
Marketers are interested in roles and relative
influences played by husband, wife and
children in purchase decisions.
Roles & Statuses
Personal Factors
Age & Stage in Life Cycle
Occupation & Economic Circumstances
Personality & self Concept
Psychographics – Life style
V.A.L.’s Segmentation
Actualizers: successful, sophisticated, active and take
charge of people. Buys niche oriented products
Fulfilleds: Mature, satisfied, comfortable, reflective – looks
for durability and functionality in products.
Achievers: successful, career and work oriented – favor
established brands, seeks prestige products.
Experiencers: Young, vital, enthusiastic, impulsive – high
spenders on clothing, fast food, music movies etc.
Believers: Conservative, traditional - buys popular brands
Strivers: Insecure, uncertain – favor stylish imitations
Makers: Practical, self-sufficient – functional products, tools
Strugglers: elderly, resigned, passsive
Psychological factors
Motivation
Freud’s Theory (ulterior motives)
Maslow’s theory (need hierarchy)
Herzbersg’s theory (satisfiers & dissatisfiers)
Perception
Selective attention, selective distortion & selective
retention – meaning making process.
Learning (Classical conditioning and Operant
Learning)
Beliefs & Attitudes
TYPES OF BUYING BEHAVIOR
Low Buyer Involvement High
Few
Habitual Buying Dissonance
Behavior Reducing Buying
Behavior
Significant
Differences
Between Brands
Variety seeking Complex Buying
Buying Behavior Behavior
Many
Five Buying Roles
Initiator: person suggesting the purchase of the
product.
Influencer: The person whose views or advices
affect the buying decision.
Decider (Payer): The person who decides on the
entire buying decision or aspects of it – what, when,
where and how to - buy
Buyer: The person making the purchase.
User: The person who actually uses the product
Consumer Move From Total Set
Towards Purchase
Total Set
Awareness Set
Consideration
set
Choice
Set
Buying Decision
Evaluation Of Alternatives
Attitude of
Others
Alternative Purchase Purchase
Evaluation Intention Decision
Unanticipated
Situational
Factors
Five Stages Of Consumer Buying Process
Post
Problem Information Alternative Purchase
Purchase
recognition search Evaluation Decision
Behavior
1. Problem recognition: stage when the need is recognized and the
trigger can be due to an internal or external stimuli.
2. Information search: Customer is likely to search for alternatives that
will solve his/her problem. – about Product categories ---- about product
attributes ----about different brand.
3. Evaluation Of Alternatives: Starts with basic need gratification. He
then evaluates certain product attributes that can maximize his benefits
(wants). Hence its more of a comparison of attributes/benefits.
Evaluation Of Alternatives
Two factors affecting during this juncture are
1. Attitude of others
i) depends on the intensity of the negative
reactions from others
ii) the motivation of the customer to listen to them
2. Unanticipated Situational Factors
These are typically unexpected factors such as
financial problems, price rises, losing job etc.
Purchase Decision
Customer after attribute based evaluation would
have moved to the choice set / final buy.
Five sub decisions prior to purchase intention –
Brand decision
Retailer / Vendor decision
Quantity to be bought
Timing – now or later
Payment method – cash or credit (Credit
Card/EMI)
Post Purchase Behavior
Purchase satisfaction
Based on the buyer’s expectations and his
perceived performance by the product.
If its below expected levels, consumer will be
dissatisfied –
Negative word of mouth
No repeat buying
Post purchase dissonance:
Especially in case of high involvement product
purchase.
Tk u
