CHAPTER

1. 3 CHAPTER Consumer Decision Making

2. The Importance of UnderstandingConsumer Behavior LO1 Explain why marketing managers should understand consumer behavior

3. “Ultimate” consumers who buy goods and services for their own personal or household use. The ConsumerMarket

4. Needs vs. Wants(Typical Textbook Def.) • Needs • Unsatisfactory conditions of the consumer that lead him or her to actions that will make the conditions better • Wants • Desires to obtain more satisfaction than is absolutely necessary to improve unsatisfactory conditions

5. ConsumerBehavior Processes a consumer uses to make purchase decisions, as well as to use and dispose of purchased goods or services; also includes factors that influence purchase decisions and the product use. Consumer Behavior LO1

6. consumers make purchase decisions Consumer behavior = HOW consumers use anddispose of product REVIEW LEARNING OUTCOME LO1 Understanding Consumer Behavior

7. The Consumer Decision-Making Process LO2 Analyze the components of the consumer decision-making process

8. A five-step process used by consumers when buying goods or services. Consumer Decision-Making Process ConsumerDecision-MakingProcess LO2

9. Need Recognition Information Search Cultural, Social, Individual and Psychological Factors affect all steps Evaluation of Alternatives Purchase Postpurchase Behavior Consumer Decision-Making Process LO2

10. Result of an imbalance between actual and desired states. Need Recognition Need Recognition LO2

11. Internal Stimuli Preferred State Present Status External Stimuli Marketing helps consumers recognize an imbalance between present status and preferred state. Need Recognition LO2

12. Any unit of input affecting one or more of the five senses: • sight • smell • taste • touch • hearing Stimulus Stimulus LO2

13. When a current product isn’t performing properly When the consumer is running out of a product When another product seems superior to the one currently used Recognition of Unfulfilled Wants LO2

14. Information Search Internal Information Search • Recall information in memory External Information search • Seek information in outside environment • Nonmarketing controlled • Marketing controlled LO2

15. EVOKED SET: Group of brands that come to mind around time of purchase CONSIDERATION SET: Group of brands a consumer will consider buying after search is complete Car Tire Brands? Typically 3-5 Brands in Consideration Set STAGE 2 – INFORMATION SEARCHIS INFLUENCED BY:

16. Group of brands, resulting from an information search, from which a buyer can choose Evoked Set Evoked Set LO2

17. Evoked Set Analyze product attributes Use cutoff criteria Rank attributes by importance Purchase! Evaluation of Alternativesand Purchase LO2

18. To buy or not to buy... Marketing Determines which attributes are most important in influencing a consumer’s choice Purchase LO2

19. Cognitive Dissonance CognitiveDissonance Inner tension that a consumer experiences after recognizing an inconsistency between behavior and values or opinions. LO3

20. Postpurchase Behavior Marketing can minimize through: Effective Communication Follow-up GuaranteesWarranties LO3 Consumers can reduce dissonance by: • Seeking information that reinforces positive ideas about the purchase • Avoiding information that contradicts the purchase decision • Revoking the original decision by returning the product

21. Cultural Influences on Consumer Buying Decisions LO4 Identify and understand the cultural factors that affect consumer buying decisions

22. Cultural Factors Social Factors CONSUMERDECISION- MAKING PROCESS BUY / DON’T BUY Psycho-logical Factors Individual Factors Factors Influencing Buying Decisions LO4

23. Set of values, norms, attitudes, and other meaningful symbols that shape human behavior and the artifacts, or products, of that behavior as they are transmitted from one generation to the next. Culture Culture LO4

24. Values Language Myths Customs Rituals Laws Material artifacts Components of Culture LO4

25. Pervasive Functional Learned Dynamic Culture is. . . LO4

26. Value Enduring belief that a specific mode of conduct is personally or socially preferable to another mode of conduct. Value LO4

27. Success Materialism Freedom Progress Youth http://www.thesource.com Capitalism Online Core American Values LO4

28. Subculture A homogeneous group of people who share elements of the overall culture as well as unique elements of their own group. http://www.dead.net Online Subculture LO4

29. A group of people in a society who are considered nearly equal in status or community esteem, who regularly socialize among themselves both formally and informally, and who share behavioral norms. SocialClass Social Class LO4

30. Occupation Income Education Wealth Other Variables Social Class Measurements LO4

31. Social Influences on Consumer Buying Decisions LO5 Identify and understand the social factors that affect consumer buying decisions

32. Social Influences Reference Groups Opinion Leaders Family Members LO5

33. Reference Group A group in society that influences an individual’s purchasing behavior. LO5 Reference Group

34. They serve as information sources and influence perceptions. They affect an individual’s aspiration levels. Their norms either constrain or stimulate consumer behavior. Influences of Reference Groups LO5

35. Opinion Leaders An individual who influences the opinion of others. LO5 Opinion Leaders

36. Reference Group Impact Example • Social Environment usually much more influential • Opinion Leaders Important • Rich’s runners’ group example...

37. Family LO5 Purchase Process Roles in the Family • Initiators • Influencers • Decision Makers • Purchasers • Consumers

38. Individual Influences onConsumer Buying Decisions LO6 Identify and understand the individual factors that affect consumer buying decisions

39. Gender Age Life Cycle Personality Self-Concept Lifestyle Individual Influences LO6

40. Psychological Influences onConsumer Buying Decisions LO7 Identify and understand the psychological factors that affect consumer buying decisions

41. Psychological Influences Perception Motivation Learning Beliefs & Attitudes LO7

42. Process by which people select, organize, and interpret stimuli into a meaningful and coherent picture. Perception Perception LO7

43. Selective Exposure Selective Distortion Selective Retention Perception LO7

44. Selective Exposure Consumer notices certain stimuli and ignores others SelectiveDistortion Consumer changes or distorts information that conflicts with feelings or beliefs Selective Retention Consumer remembers only that information that supports personal beliefs Perception LO7

45. Marketing Implications of Perception • Important attributes • Price • Brand names • Quality and reliability • Threshold level of perception • Product or repositioning changes • Foreign consumer perception LO7

46. The “F” Test Count the number of Fs in the following sentence: FINISHED FILES ARE THE RESULT OF YEARS OF SCIENTIFIC STUDY COMBINED WITH THE EXPERIENCE OF MANY YEARS.

47. Stimulus Discrimination vs. Stimulus Generalization

48. Interpretation: Meaning consumer attaches to a stimulus • NAMES • Signal Power /Quality (Toro Snow Pup/Master) • Cars: Mustang / Barracuda / Viper • Donkey / Weasel? • NUMBERS • 350 Z / WD-40 / Acura CL? • COLORS • Different for different cultures

49. Interpretation: Meaning consumer attaches to a stimulus • COLOR • Signal Newness or Quality (Black Label) • Signal Product Contents (Sodas)

50. A method of classifying human needs and motivations into five categories in ascending order of importance. Motivation Maslow’s Hierarchy of Needs LO7