Download Chapter 5: Consumer Markets

Analyzing
Consumer Markets
Consumer Buying Behavior
► Consumer
Buying Behavior refers to the
buying behavior of final consumers
(individuals & households) who buy goods
and services for personal consumption.
► Study consumer behavior to answer:
“How do consumers respond to marketing
efforts the company might use?”
Model of Consumer Behavior
Product
Price
Marketing and
Other Stimuli
Economic
Technological
Place
Political
Promotion
Cultural
Buyer’s
Decision
Process
Product Choice
Brand Choice
Dealer Choice
Buyer’s Black Box
Buyer’s Response
Characteristics
Affecting
Consumer
Behavior
Purchase
Timing
Purchase
Amount
Culture
The sum total of learned beliefs, values, and
customs that serve to regulate the consumer
behavior of members of a particular society.
When to eat, Where to eat,
What to eat for each meal,
What to serve guests at a dinner party,
picnic, or wedding.
Sub-Culture – More specific identification
and socialization for their members
Marketing Mix Adaptation
In India, McDonald’s serves chicken, fish, and vegetable burgers, and the Maharaja
Mac—two all-mutton patties, special sauce, lettuce, cheese, pickles, onions, on a
sesame-seed bun.
3-6
Traditionally , Jewellery
and Mehndi are very
important for Brides in
India
Cultural Values help marketers to plan their Marketing Mix accordingly .
Multicultural Marketing in recent years
Sub cultures:
Targeting Hindi
speaking belt of North
India
Sub-cultures:
During Navaratri , most
Hindus observe Fast and
stay vegetarian. This Ad
is meant to attract
particularly this group and
others who are vegetarian
Cultural Shifts
Factors Affecting Consumer Behavior:
Social Factors
Groups
•Membership
•Reference
Family
•Husband, wife, kids
•Influencer, buyer, user
Roles and Status
Social Factors
Reference Group’s Influences on Consumer
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Seek expert advice from sources such as friends , neighbors
rather than Advertising
Compare their attitudes with those of the members of
important groups.
Expose them to new behaviors & lifestyle
They create pressure for conformity that effect actual Product
and brand choice
Marketers use spokesperson perceived by consumers similar to
them Like Lalitaji in the Ads of Surf viewed as typical housewife
Actual referent , a
“typical “
consumer”
“Bhai Sahab Surf ki
Kharidari mein hi
Samajhdari Hai”
WOM and Buzz Marketing
Word-of-mouth influence and buzz marketing
 Opinion leaders are people within a reference group who
exert social influence on others
 Also called influentials or leading adopters
 Marketers identify them to use as brand ambassadors
► P&G Tremour
► Kit-Kat Kubes Nestle hired a agency to create buzz among
Opinion leaders in the age of 16-25 market
A database of about 20,000 was sent Text messages to 100
Opinion leaders. They were sent large box of Kit-Kat
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Normative Influence :Conformity to behave in the way
as the group behaves
Marketers try to show that people patronize brands
approved by the group
e.g. Mobile phones , bikes become status symbol for
youngsters
Fear appeals : Colgate Suraksha Chakra ,Pimple remedies
, anti- Dandruff shampoos , Toothpaste to stop bad
breadth , Orient PSPO
Households
Family Households:
Married couple,
Nuclear family,
Extended family
Households
Non-Family Households:
Unmarried couples,
Friends/ Roommates,
Boarders
Functions of the Family
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They are the most important consumer buying organization in
society
Husband wife Involvement
Men now doing 40% of food shopping
Women today now involve in more technology purchase
Children have strong influence on family ‘s buying decision
Factors Affecting Consumer Behavior:
Personal Factors
Personal Influences
Age and Family Life Cycle
Stage
Economic Situation
Occupation
Personality & Self-Concept
Age and life-cycle stage
► RBC
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Royal Band stages
Youth: younger than 18
Getting started: 18–35
Builders: 35–50
Accumulators: 50–60
Preservers: over 60
Occupation and economic circumstances
Marketers should try identify the occupational groups
that have interest in their products and services
► Product choice is greatly affected by the economic
circumstances – spendable income , savings
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Brands like Gucci , Prada , Loui Vouiton in economic
downturn
Personality & Self concept
What is
Personality?
The inner
psychological
characteristics that
both determine and
reflect how a person
responds to his or her
environment.
Personality Traits
►
Levis with ruggedness ,
MTV with Excitement
,CNN with competence
►
Levis – Youthful ,
fashion . Conscious
►
Company utilizes
product features ,
services and image
making to transmit the
product’s personality
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Consumers choose brand
personality consistent
with their own actual self
concept (how one views
oneself), Consumer's ideal
concept ( how one would
like o view oneself) or
even other’s self concept
(how one thinks others
sees one ) rather than
actual self image
Life-style and values
It is person’s pattern of living in the
world as expressed in activities ,
interests , and Opinions
e.g Mountain Dew , KurKure – Teda hai par
Mera Hai , Kit – Kat , Wal Mart & Big
bazaar with EDLP for Money constrained
consumers , Ready made food for Time
constrained consumers
► Marketers even uncovers new trends in
consumer lifestyles – e.g Atkins Food for
Diet conscious , green customer
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Factors Affecting Consumer Behavior:
Psychological
Motivation
Beliefs and
Attitudes
Psychological
Factors
Learning
Perception
Maslow’s Hierarchy of Needs
Why people are
driven by particular
needs ?
What consumer
products might
fulfill multiple
levels of the
Hierarchy of
Needs?
Self
Actualization
(Self-development)
Esteem Needs
(self-esteem, status)
Social Needs
(sense of belonging, love)
Safety Needs
(security, protection)
Physiological Needs
(hunger, thirst)
High –tech products such as computers or sound
systems and luxury products such as furs , big
cars or expensive furniture
All personal care and
grooming products e.g.
cosmetics , mouthwash,
shaving cream, clothes
insurance ,
preventive medical
services and home
security systems
health foods , medicines
and low fat and diet
products
Help marketers understand how various products fit into plans and lives of consumers
Perception
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Perception is the process by which individual selects , organizes
and interprets information inputs to create a meaningful picture
of the world
Three Perceptual processes
 Selective attention – 50-100 Ads - some stimuli will be
screened out
 Selective distortion- tendency to interpret information in a
way that will fit our preconceptions
 Selective retention – fail to register much information and
retain to what supports them . We remember good pts of
product we like and
 Subliminal perception – Consumers are not consciously aware
, but yet they affect their behavior
Influencing Buyer Behavior
 Learning - Changes in Individuals behavior
arising from experience
Learning occurs through interplay of
Drive , Stimuli, Cues , responses and
reinforcement
 Beliefs and Attitudes: Mc Donald's adapting
to religion and family orientations
Types of Buying Decisions
High
Involvement
Low
Involvement
Significant
differences
between
brands
Complex
Buying
Behavior
VarietySeeking
Behavior
Few
differences
between
brands
DissonanceReducing Buying
Behavior T.V
Automobiles
Habitual
Buying
Behavior
Cookies
Salt
The Buyer Decision Process
Need Recognition
Information Search
Evaluation of Alternatives
Purchase Decision
Postpurchase Behavior
The Buyer Decision Process
Step 1. Need Recognition
Need Recognition
Difference between an actual state and a desired state
Internal Stimuli
External Stimuli
• Hunger
• TV advertising
• Thirst
• Magazine ad
• A person’s normal
needs
• Radio slogan
•Stimuli in the
environment
The Buyer Decision Process
Step 2. Information Search
Personal Sources
•Family, friends, neighbors
•Most influential source of
information
Commercial Sources
•Advertising, salespeople
•Receives most information
from these sources
Public Sources
Experiential Sources
•Mass Media
•Consumer-rating groups
•Handling the product
•Examining the product
•Using the product
Figure : Successive Sets Involved in Customer
Decision Making
The Buyer Decision Process
Step 3. Evaluation of Alternatives
Product Attributes
Evaluation of Quality, Price, & Features
Degree of Importance
Which attributes matter most to me?
Brand Beliefs
What do I believe about each available brand?
Total Product Satisfaction
Based on what I’m looking for, how satisfied
would I be with each product?
Evaluation Procedures
Choosing a product (and brand) based on one
or more attributes.
The Buyer Decision Process
Step 4. Purchase Decision
Purchase Intention
Desire to buy the most preferred brand
Attitudes
of others
Unexpected
situational
factors
Purchase Decision
The Buyer Decision Process
Step 5. Post purchase Behavior
Consumer’s Expectations of
Product’s Performance
Product’s Perceived
Performance
Satisfied
Customer!
Dissatisfied
Customer
Cognitive Dissonance
Stages in the Adoption Process
Awareness
Interest
Gillette Mach3
Evaluation
Trial
Adoption
Early Majority
Innovators
Percentage of Adopters
Adoption of Innovations
Early
Adopters
34%
Late Majority
16%
13.5%
2.5%
Early
Laggards
34%
Time of Adoption
Late
► Relative
Advantage
► Compatibility
► Complexity
► Divisibility
► Communicability