Download Ch 5 - International Business courses

Consumer Behavior:
How and Why We Buy
Chapter Five
© 2012 Pearson Education, Inc. publishing as Prentice-Hall
Chapter Objectives
 Define consumer behavior and explain
the purchase decision-making process
 Explain how internal factors influence
consumers’ decision-making processes
 Show how situational factors and
consumers’ relationships with other
people influence consumer behavior
© 2012 Pearson Education, Inc. publishing as Prentice-Hall.
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Real People, Real Choices:
Decision Time at (RED)
 What is the optimal way to generate the
most money for the Global Fund?
• Option 1: Expand the (RED) model
based on what the research revealed
about the teen market
• Option 2: Stick with the existing (RED)
model
• Option 3: Expand the (RED) model to
include more traditional non-profit
features
© 2012 Pearson Education, Inc. publishing as Prentice-Hall.
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The Consumer Decision-Making
Process
 Consumer behavior:
The process we use to select,
purchase, use, and dispose of goods,
services, ideas, or experiences to
satisfy needs/desires
 Internal, situational, and social factors
influence consumer behavior
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Not All Decisions Are the Same
 The amount of effort expended in
decision-making varies according to
the nature of the task:
• Extended problem-solving
• Limited problem solving
• Habitual decision-making
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Step 1: Problem Recognition
 Occurs whenever the consumer sees a
significant difference between his/her
current state and the desired/ideal state
 Marketers can develop ads that
stimulate problem recognition
• Example: radio ads promoting
restaurants which are played at
lunchtime
• Example: TV ad showing excitement of
owning a new car
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Step 2: Information Search
 Consumers need adequate information to make

a reasonable decision:
• Consumers search memory and the
environment for information
• Internet search engines, portals, and
shopbots are being increasingly relied upon
Behavioral targeting:
• Marketers deliver ads for products consumers
look for by watching what they do online
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Step 3: Evaluation of Alternatives
 A consumer identifies a small number
of product interests, then narrow
choices and compare the pros and
cons associated with the purchase
• Evaluative criteria:
Product characteristics consumers use
to compare competing alternatives
• Marketers identify and communicate
important evaluative criteria to buyers
© 2012 Pearson Education, Inc. publishing as Prentice-Hall.
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Step 4: Product Choice
 Consumers often rely on heuristics to
make decisions
• Heuristics:
A mental rule of thumb used for a
speedy decision, such as . . .
Price
equals quality
Brand loyalty
Country of origin
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Step 5: Post-purchase Evaluation
 Consumer satisfaction/dissatisfaction
after purchase of product is critical:
• Degree of satisfaction is influenced by
whether or not expectations of product
quality are met/exceeded
• Marketing communications must create
accurate expectations for the product
• Cognitive dissonance is common
© 2012 Pearson Education, Inc. publishing as Prentice-Hall.
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Internal Influences
on Consumers’ Decisions
 Multiple factors cause individual
consumers to interpret information
about the outside world differently:
• Perception
• Motivation
• Learning
• Attitudes
© 2012 Pearson Education, Inc. publishing as Prentice-Hall.
• Personality
• Age group
• Lifestyle
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Perception

Perception:
• Process we use to select, organize, and
interpret information from outside world

Three factors are necessary for perception to
occur:
• Exposure: capable of registering a stimulus
• Attention: mental processing activity
• Interpretation: assigning meaning
to a stimulus
© 2012 Pearson Education, Inc. publishing as Prentice-Hall.
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Motivation
 Motivation
Internal state that drives us to satisfy
needs by activating goal-oriented
behavior
 The hierarchy of needs categorizes
motivation as being related to five
different types of needs
• Need types include physiological,
safety, belongingness, ego, and
self-actualization
© 2012 Pearson Education, Inc. publishing as Prentice-Hall.
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Learning
 Learning:
A relatively permanent change in
behavior caused by information or
experience
 Behavioral learning theories:
• Classical conditioning
• Operant conditioning
 Cognitive learning theory:
• Observational learning
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Attitudes
 Attitude:
Lasting evaluations of a person, object,
or issue
• Three attitude components include:
Affect
(feeling): emotional response
Cognition (knowing): beliefs or
knowledge
Behavior (doing): intention to do
something
© 2012 Pearson Education, Inc. publishing as Prentice-Hall.
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Personality
 Personality

The set of unique psychological
characteristics that consistently influences
the way a person responds to situations in
the environment
• Marketers create brands that appeal to
different personalities
Self-concept:
• Can influence the products purchased by
consumers
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Age
 Age:
• Goods/services often appeal to a
specific age group
• Purchases are often associated with a
particular stage in the family life cycle
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Lifestyle
 Lifestyle:
A pattern of living that determines how
people choose to spend their time,
money, and energy
 Marketers describe people according to
activities, interests, and opinions
 Psychographics:
Group consumers according to
psychological and behavioral
similarities
© 2012 Pearson Education, Inc. publishing as Prentice-Hall.
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Situational and Social Influences
on Consumers’ Decisions

Situational factors shape purchase choices:
• Physical environment:
 Décor,
smells, lighting, music and temperature
influence consumption
 Arousal and pleasure determine consumers’
reaction to store environment
 Entertainment enhances shopping experiences
• Time poverty influences consumption

Social influences also affect the consumer
decision-making process
© 2012 Pearson Education, Inc. publishing as Prentice-Hall.
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Culture

Culture:
The values, beliefs, customs, and tastes
produced or practiced by a group of people
• Includes key rituals like weddings and

•
funerals
Marketers tailor products to cultural values
Subculture:
A group within a society who share a
distinctive set of beliefs, characteristics,
or common experiences
• Microcultures
© 2012 Pearson Education, Inc. publishing as Prentice-Hall.
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Emerging Lifestyle Trends

Consumerism
• A social movement that attempts to protect
consumers from harmful business practices

 Consumer
Bill of Rights
Environmentalism
• Seeks conservation and improvement of the
natural environment
 Kyoto
Protocol
 Environmental stewardship
 Green marketing
 Greenwashing
© 2012 Pearson Education, Inc. publishing as Prentice-Hall.
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Social Class

Social class
The overall rank or social standing of groups
of people within a society, according to
factors such as family background,
education, occupation, and income
• Status symbols such as luxury products allow
•
people to flaunt their social classes
Mass-class consumers are targeted by many
marketers
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Group Memberships
 Reference group
An actual or imaginary individual or
group that has a significant effect on an
individual’s evaluations, aspirations, or
behavior
• Reference groups influence purchases
among those who seek to imitate them
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Opinion Leaders
 Opinion leaders
• Are frequently able to influence others’
attitudes or behaviors
• Have high interest in product category
• Update knowledge by reading, talking
with salespeople, etc.
• Impart both positive and negative
product information
• Are among the first to buy goods
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Gender Roles
 Gender roles
Society’s expectations regarding
appropriate attitudes, behaviors, and
appearance for men and women
• Consumers often associate “sex-typed”
products with one gender or the other
• Sex roles are constantly evolving
Metrosexuals
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Real People, Real Choices:
Decision Made at (RED)
 Julia chose option 1
• Why did Julia choose to continue to
seek major international brands to
partner with, while complementing
those partnerships with smaller special
editions that appealed to a younger age
group?
© 2012 Pearson Education, Inc. publishing as Prentice-Hall.
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Keeping It Real: Fast-Forward to
Next Class Decision Time at NCR
 Meet Brad Tracy, VP of Americas
Marketing Deployment for NCR
 NCR recently released a new
generation of point of sale (POS)
workstations
 The decision to be made:
Should NCR continue to attend a
particular trade show?
© 2012 Pearson Education, Inc. publishing as Prentice-Hall.
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photocopying, recording, or otherwise, without the prior
written permission of the publisher. Printed in the United
States of America
© 2012 Pearson Education, Inc. publishing as Prentice-Hall.
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