NPC

Lecture 3

Consumer Behavior

NPC

Lecture 3

Consumer BuyingProcess

Post-purchase behavior: Consumption value

Purchase decision: Buying value

Alternative evaluation:Assessing value

Information search:Seeking value

Problem recognition:Perceiving need

NPC

Lecture 3

How is the Need/Want Created?

ideal

ideal

actual

actual

Need Recognition

Opportunity Recognition

Psychological states

NPC

Lecture 3

Evoked/Consideration Set

Inert Set

Inept Set

Information Search: Identifying Alternatives

x ?

NPC

Lecture 3Source: Consumer Reports’

Panasonic

Phillips

Phillips

Sony

Aiwa

Sony

Panasonic

JVC

Sony

Panasonic

Aiwa

SL-SX500

AZ7383

AZ7583

D-E409CK

XP-SP1200

D-E401

SL-SW505

XL-P34

D-ES55

SL-S230

XP-570

$ 150

100

120

140

145

100

150

80

200

80

75

Rating:

(A CR best buy)

Excellent

Good

Fair

Poor

VeryGood

Error LocateBrand Model Price Headphones Correction Bumps Speed

Compensatory andNon-compensatory Decision Making

Portable Compact Disc Players

NPC

Lecture 3

Cognitive Dissonance…

is a feeling of post-purchase psychological tension or anxiety.

To alleviate cognitive dissonance,

consumers often:• seek confirming information• avoid disconfirming information

NPC

Lecture 3

High Involvement purchase decisions typically involve extensive information search, consideration of several product attributes and brands, the formation of attitudes, and word-of-mouth communication. (e.g., automobile, stereo system)

Low Involvement purchase decisions typically involve little information search, and examine brands on the basis of price. They tend to be privately consumed. (e.g., soap, toothpaste)

Perceived Risk is the anxiety experienced when

outcomes are unknown, yet one believes that there

may be negative consequences. • monetary• functional• physical• social• psychological

NPC

Lecture 3

Influences on the Consumer Purchase Decision Process

Marketing mix• Product• Price• Promotion• Place

Situation• Purchase task• Social surroundings• Physical surroundings• Temporal effects• Antecedent states

Problem recognitionInformation search

Alternative evaluationPurchase decision

Post-purchase behavior

Consumer Decision ProcessPsychological

• Motivation• Personality• Perception• Learning• Values, beliefs

and attitude• Lifestyle

Sociocultural

• Personalinfluence

• Reference groups• Family• Social class• Culture• Subculture

NPC

Lecture 3

Selective perception filters

Messages

Selective exposureSelective exposure

Selective comprehensionSelective comprehension

Selective retentionSelective retention

NPC

Lecture 3

Learning refers to those behaviors that result from:• repeated experience and/or, • thinking

Behavioral Learning is the process of developing

automatic responses to a situation built up through

repeated exposure to it.

Cognitive Learning is learning via thinking, reasoning,

and mental problem solving without direct experience.

NPC

Lecture 3

Value Driversof Market Choice Behavior

FunctionalValue

SocialValue

ConditionalValue

EpistemicValue

EmotionalValue

MarketChoice

Behavior

5

NPC

Lecture 3

Organizational Buying Behavior

NPC

Lecture 3

Types of B2B Customers

Commercial Manufacturers, construction companies, service

firms, transport companies, some professional groups, and resellers

Institutional Organizations that provide services without the

motivation of profit such as hospitals and universities

Government The government market consists of federal,

provincial/state, and local/municipal governments

NPC

Lecture 3

Business Market Characteristics

Derived:

Link between demand for

industrial product and demand for

consumer products

Fluctuating:

Patterns and preferences in the household market

can change the demand for

industrial goods

Stimulating:

Some industrial products must market to the

ultimate consumer directly

DEM

AN

D

NPC

Lecture 3

Relationship Marketing:

Marketing activities directed at establishing/

maintaining relationships

Longer-term

and closer relationships with fewer suppliers

Closer interactions

among multiple functions on both buying and selling

sides

BU

YER

-SEL

LER

REL

ATIO

NSH

IPS

Business Market Characteristics

NPC

Lecture 3

Supply Chain Management:

Linking with strategic suppliers, intermediaries, and

customers to improve efficiency

JIT:

Just-in-time production to

deliver defect-free parts to

production just when needed

ERP:

Software that can help enhance the flow of a supply

chain

SUPP

LY C

HA

IN

Business Market Characteristics

NPC

Lecture 3

Problem Recognition

General Description of Need

Detailed Description of Product Specs

Supplier Search

Acquisition and Analysis of Proposals

Supplier Selection

Selection of an Order Routine

Performance Review

Organizational Buying Process

NPC

Lecture 3

Modified Rebuy

New Buy

Straight Rebuy

Buying Situations

increases increases

Risk

Size

of b

uyin

g ce

ntre

NPC

Lecture 3

Gatekeeper

Users

Influencers

Buyers

Deciders

Buying Center Roles