Consumer Behaviour and Marketing Decisions

8/7/2019 Consumer Behaviour and Marketing Decisions

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Module 5

By

Dr. Ruchi Jain


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St udying consumer behavior

Wha t is consumer behavior Buying Decision Process and

Fac tors Affec ting Buyer Behavior, Consumer Adop tion Process. Buying Behavior for Consumer Marke ts

and Indus trial Marke ts, Types of Buying S itua tions,


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Refers to the buying behavior of peoplewho buy goods and services for personaluse. How do consumers respond to various

marke ting effor ts the company migh t use?

Consumer Buying Behavior


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Model of Consumer Behavior


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Wha t Influences

Consumer Behavior? Cul tural Fac tors

S ocial Fac tors

Personal Fac tors


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Wha t is Cul ture?

Culture is the fundamen tal de terminan t of a persons wan ts and behaviors

It is acquired through socializa tionprocesses wi th family and o ther keyins titu tions.

Culture is learned.Cultural shif ts crea te oppor tuni ties for

new produc ts


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Indian cul ture trai ts adop ted by

brandsMTR -So uth,N o rth,snacks,main c o urse,icecream etc.DABU R FOOD P R ODUC TS (Ho memade)

GOLD M ASTER CA R D-(Family o rientedappr o ach)S urf excel -(Br o ther S ister R elati o n, DaagAche hain -b laming o ther f o r anymishappening when she falls int o thepuddle)Bank o f India -R isht o ki Jamapunji(friendship)Airtel - K uch Bandhan at oo t h o te hai jaiseairtel ka netw o rk(Father So n) 7


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S ocial Fac tors

Reference

groups

S ocialroles

St a tuses

Family


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Gr o ups :A reference group is any individual or collec tion of people whom the individual uses asa source of a tt itudes, beliefs, values of behaviour.

Membership groups

Aspira tional groups

Family :A family is a group of a t leas t two peopleformed on the basis of marriage, cohabi ta tion,

blood relationship, or adop

tion. Family of Orien ta tion

Family of Procrea tion

S ocial Fac tors


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Roles and St a tus

Wha t degree of s ta tus isassocia ted wi th various

occupa tional roles?


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Age and Life-Cycle St age

Occupa tion

Economic S itua tion

Lifestyle:

-

Personal Fac tors


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The Family Life Cycle


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K ey Psychological Processes

Motiva

tion

MemoryLearning

Perception


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Mo tiva tiona m o tive ( o r drive) is a need that is sufficiently pressingto direct the pers o n t o seek satisfacti o n.

1. P o sitive m o tivati o n

2. Negative m o tivati o n (Insurance, de o d o rants, gyms)3. Physi o lo gical4. Psych o genic (achievement, affiliati o n, status)

M asl o ws hierarchy o f needs explains why pe o ple aredriven b y needs at particular times .


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Maslow s Hierarchy of Needs


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Percep tion

Process by which people selec t ,Process by which people selec t ,organize, and in terpre t informa tion toorganize, and in terpre t informa tion toform a meaningful pic ture of the world.form a meaningful pic ture of the world.

People can form different perceptionsof the same stimulus. for ex-Store image,

colors, price, product factors makes theperception.


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A rela tively permanen t change in behavior dueto experience.

Interplay of drives, s timuli, cues, responses, andreinforcemen t .St rongly influenced by the consequences of anindividuals behavior

Behaviors with sa

tisfying resul

ts

tend

to be repea

ted. Behaviors wi th unsa tisfying resul ts tend no t to be

repea ted.

Learning


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Roles played by buyer

Initiat o r Influencer Decider Purchaser

User


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Consumer Buying Process or Buyer Decision Process

Problem Recogni tion

Informa tion S earch

Evalua tion

Purchase Decision

Pos tpurchaseBehavior


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1.Need R ec o gniti o n1.Need R ec o gniti o n

A need rec o gniti o n is a result o f anA need rec o gniti o n is a result o f anim b alance b etween actual and desiredim b alance b etween actual and desiredstates.states. Need rec o gniti o n is triggered when a c o nsumer isNeed rec o gniti o n is triggered when a c o nsumer is

exp o sed t o either an internal o r an externalexp o sed t o either an internal o r an externalstimulus.stimulus.

S timulus is any unit o f input affecting o ne o r m o reS timulus is any unit o f input affecting o ne o r m o re

o f the five senses: sight, smell, taste, t o uch,o f the five senses: sight, smell, taste, t o uch,hearing.hearing. M arketers can als o create wants. Wants are theM arketers can als o create wants. Wants are the

rec o gniti o n o f an unfulfilled need and a pr o ductrec o gniti o n o f an unfulfilled need and a pr o ductthat will satisfy it.that will satisfy it.


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2.Inf o rmati o n searchS earch time & inv o lvement are theS earch time & inv o lvement are theb uyer investments in decisi o n making.b uyer investments in decisi o n making.Ro utine resp o nse b ehavi o r Ro utine resp o nse b ehavi o r: frequently: frequentlypurchased, l o wpurchased, l o w --c o st g oo ds andc o st g oo ds and

servicesservicesLimited decisi o n makingLimited decisi o n making: m o derate: m o derate

am o unt o f time f o r gatheringam o unt o f time f o r gatheringinf o rmati o ninf o rmati o nE xtensive decisi o n making:E xtensive decisi o n making: whenwhenb uying an unfamiliar, expensive pr o ductb uying an unfamiliar, expensive pr o ducto r an infrequently bo ught itemo r an infrequently bo ught item


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So me decisi o ns inv o lve a careful, l o gical,and systematic evaluati o n b y the c o nsumer.Other decisi o ns such as impulse b uys are made with virtually n o th o ught at all.Friends, c o nsumers guides, o r salespe o plemay o r may n o t influence the decisi o n.M

arketers must study ho

w targetedc o nsumers make evaluati o ns, s o they will b ein a b etter p o siti o n t o influence evaluati o ns.

3.Evalua tion of Al terna tives


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Purchase Decision

Inten tions to purchase a par ticular brandare no t always ac ted upon.

Factors

tha

tinfluence

the purchasedecision:

A tt itudes of o thers Unexpec ted si tua tional fac tors


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Pos t purchase Behavior

Consumer sa tisfac tion is a func tion of consumer expec ta tions and perceivedproduc t performance.

If Performance Is BELOWExpec ta tions = Disappoin tmen t

If Performance EQUAL S Expec ta tions = S a tisfac tion

Performance Is GREATERthan Expec ta tions = Deligh t


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C ognitive Dissonance: af ter making a purchase,buyers of ten doub t whe ther they made the righ t decision.

Marke ters can minimize dissonance by: Reassuring consumers they made the righ t choice

and minimizing the po ten tial for produc t misuse(produc t litera ture and ins truc tions).

Offering mechanisms for lodging complain tsBeing responsive to problems and ques tions.

Cogni tive Dissonance


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CON S UMER ADOPTIONPROCE SS

The s tages through which an individual

consumer passes in arriving at

a decisionto try (or no t to try), to con tinue using (or discon tinue using) a new produc t


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S tages in Ad o pti o n Pr o cess

NAME OF

STAGE

WHAT HAPPENS DURING

THIS STAGEEXAMPLE

AwarenessConsumer is first exposedto the product innovation.

XYZ sees an ad for a new MP3 player in themagazine she is reading.

Interest

Consumer is interested inthe product and searchesfor additional information.

XYZ reads about the MP3 player on themanufacturer s Web site and then goes toan electronics store near apartment and hasa salesperson show a unit.

Evaluation

Consumer decideswhether or not to believethat this product orservice will satisfy theneed--a kind of mentaltrial.

After talking to a knowledgeable friend, XYZdecides that this MP3 player will allow xyz toeasily download the MP3 files that xyz hason her computer. also feels that the unit ssize is small enough


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S tages in Ad o pti o n Pr o cess

Trial

Consumer uses theproduct on a limited

basis

Since an MP3 player cannot be tried likea small tube of toothpaste, XYZ buys the

MP3 player online from Amazon.com,which offers a 30-day full refund policy.

Adoption(Rejection)

If trial is favorable,consumer decides to usethe product on a full,rather than a limitedbasis--if unfavorable, theconsumer decides toreject it.

XYZ finds that the MP3 player is easy touse and that the sound quality isexcellent. XYZ keeps the MP3 player.

NAME OF

STAGE

WHAT HAPPENS

DURING THIS STAGEEXAMPLE


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Ad o pter Categ o ries

Inn o vat o rs2.5%

E arlyAd o pters13.5%

Laggards

16%

Percentage o f Ad o pters b y Categ o ry S equence

E arlyM aj o rity

34%

LateM aj o rity

34%


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1. Innovators technology en thusias ts ven turesome enjoy mas tering the in tricacies of new produc ts.

In re turn for low prices, they are happy to conduc t alpha and be ta tes ting and repor t on earlyweaknesses.

2. Early adopters

Grea tes t degree of opinion leadership Respec ted by their peers Makes judicious innova tion-decisions

differences in individual readiness


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3 . Early majority Adop t new technology when benefi ts are provenThey make up the mains tream marke t.

4 . Late majority skep tical conserva tives who are risk averse,technology shy, and price sensi tive.

5 . Laggardstradi tion-bound and resis t the innova tion.

Each of the five groups mus t be approached wi th adifferen t type of marke ting s tra tegies.


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The b usiness market is vas t and involvesmore money and i tems than consumer marke ts.Business b uyer b ehavior refers to thebuying behavior of the organiza tions tha t buy goods and services for use in theproduc tion of o ther produc ts and services.

Business Marke ts andBusiness Buyer Behavior


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Marke t St ruc ture andDemand: Con tains far fewer bu t

larger buyers. Buyers are more

geographicallyconcen tra ted.

Business demandis derived fromconsumer demand.

Nature of the BuyingUni t:

Business purchasesinvolve more decisionpar ticipan ts.

Business buyinginvolves a moreprofessionalpurchasing effor t .

Business Marke ts


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Types of Decisions

andthe Decision Process

Business buyers usually face morecomplex buying decisions.

Business buying process tends to bemore formalized .

Buyers and sellers are much more

dependent on each o ther.


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St raigh t rebuy: Fairly rou tine purchase decision.

Modified rebuy: Requires some research and modified

produc t specifica tions, prices, terms, or suppliers.

Newtask: Requires ex tensive research and evalua tion

of produc ts, suppliers, e tc.

Types of Buying S itua tions


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1.New task problem is to tally differen t from previous experience. S ignifican t amoun t of informa tion is required.

Buyers opera te in ex tensive problem solving. Lacks s trong likings or disliking.

2. Mo dified re b uybenefi ts to be derived by reevalua ting al terna tives.

occur when displeased wi th the performance of curren t supplier. Buyers opera te in the limi ted problem solving s tage.

Buyers have well defined cri teria .

3 . S traight re b uythe problem or need is a recurring or con tinuing si tua tion. Buyers have experience in the area in ques tion. Require li tt le or no new informa tion. Buyers opera te in the rou tine problem solving s tage.

Consumer Behaviour and Marketing Decisions

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