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Chapter Three
Consumer Behavior
Key Words / Outline
Consumer research findings, Advances in consumer research,
American Demographics, Journal of the academy of Marketing
sciences, Journal of advertising, Journal of advertising research,
Journal of applied Psychology, Journal of consumer Psychology,
Journal of consumer research, Journal of Marketing, Marketing
Applications, Advertising age, Business week, Forbes, Fortune,
Marketing communication, Nation’s week, Sales and Marketing
Marketing Management, 8e
© 2007 The McGraw-Hill Companies, Inc., All Rights Reserved.
Understanding Consumer Behavior
• An understanding of consumers’, their needs and
purchasing behavior, shapes successful marketing
• No single theory of consumer behavior can totally explain
why consumers’ behave the way they do
Overview of the Buying Process
Consumer Decision Making
• It should be noted that influences have both direct and
indirect effects on the buying process
• Direct effect refers to the direct communication between the
individual and other members of the society
• Indirect influence refers to the influence of society on an
individual’s basic values and attitudes
Cultural Influences on Consumer
• Achievement and success activity – Hard work is good,
natural and healthy; leads to success
• Efficiency and practicality – Admiration for things that
solve problems; solving problems is good
• Material comfort – “The good life”
• Individualism – Self-reliance, self-interest
Cultural Influences
On Consumer Behavior
Freedom – Freedom of choice
External conformity – Desire for acceptance
Humanitarianism – Caring for others, doing good
Youthfulness – Young at heart, especially in appearance and
• Fitness and health – Caring about one’s body and
continuing wellness
Understanding Cultural Impact On
Consumer Behavior
• One of the most basic influences on an individual’s needs
• Transmitted through three basic organizations
- Family
- Religious organizations
- Educational institutions
• Marketing managers should adapt the marketing mix to
cultural values and constantly monitor value changes and
differences in both domestic and global markets
Social Classes
• Upper Americans
- 14% of the population
- High income – high quality, high prestige brands
• Middle Americans
- 34% of the population
- Concerned with following media recommendations and what
peers say is popular
Social Classes
• Working Classes
- 38% of the population
- “Family folk” – depend upon relatives for financial and
emotional support
• Lower Americans
- 16% of the population
- Very diversified, from frugality to instant gratification
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Reference Groups and Families
• Primary reference groups include family and close friends
• Secondary reference groups include fraternal and
professional organizations
• The family constitutes an important reference group
• The family life cycle is a useful way of classifying and
segmenting individuals and families
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Marketing Influences On Consumer
Decision Making
• Product influences: As a key task, marketers differentiate
their products from their competitors and create the
perception of a worthwhile product purchase.
• Price Influence: Today’s value-conscious consumers may
buy products more on the basis of price than other
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Decision Influences
• Promotion Influence: Marketing communications plays a
critical role in informing consumers about products and
• Place influences: Convenience increases the probability of
consumers finding and buying certain products
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Situational Influences
• Physical features are the most readily apparent features of
a situation
• Social features provide additional depth to a description of
a situation
• Time is a dimension of situations that may be specified in
• Task features include intent or requirement to select, shop
for, or obtain information about a purchase
• Current conditions are things like momentary moods rather
than chronic individual traits
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Psychological Influences
• Product knowledge refers to the amount of information a
consumer has stored in his or her memory about the
• Product involvement refers to a consumer’s perception of
the importance or personal relevance of an item
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Decision Making Process
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Decision Making Styles
• Extensive decision making: Requires high degrees of time
and effort because the purchase is complex, high priced or
has high importance to the consumer
• Limited decision making: Less time and effort but still may
involve some time and effort to search for alternatives
• Routine decision making: The most common way people
purchase most packaged goods. Products are simple,
inexpensive and familiar
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Need Recognition
• Maslow’s Hierarchy of Needs
- Physiological needs: Primary needs of the human body
- Safety needs: Protection from physical harm, ill health, economic
disaster and avoidance of the unexpected.
- Belongingness: Needs related to social nature of humans and
need for companionship
- Esteem needs: Consists of need for both self esteem and actual
esteem from others
- Self-actualization needs: A desire or need to become everything
one is capable of becoming
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Marketing Highlight
• Marketing Association Code of Ethics
Product development and management area
Promotion area
Distribution area
Pricing area
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Consumer Data Sources
• Internal sources: Comes from experience with similar
• Group sources: Communication from other people
• Marketing sources: Advertising, sales people, packaging
• Public sources: Publicity from article, independent ratings
• Experiential sources: Handling, examining and trying the
actual product
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Alternative Evaluation
Consumer completes information gathering
Consumer identifies alternative (s)
Differences in alternative characteristics identified
Alternative’s characteristics compared to the
characteristics deemed most needed and relevant
• The favored brand generally offers the most desirable
• The consumer buys the alternative with the greatest
number of desired characteristics
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Factors Affecting Information
Search by Customers
Market characteristics
Product characteristics
Consumer characteristics
Situational characteristics
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• Traditional risk theorists believe that consumers tend to
make risk minimizing decisions based on their perception of
risk associated with a particular purchase
• Consumers generally try to reduce their risk by reducing
negative consequences or by reducing perceived uncertainty
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Postpurchase Evaluation
• Cognitive Dissonance: Inconsistency or disharmony with
attitudes and beliefs
• Anxiety over decisions occur when
- The decision carries importance financially, psychologically, or
- The alternatives appear plentiful
- The forgone alternatives display many favorable features
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