5Analyzing Consumer Markets

Chapter Questions

How do consumer characteristics influence buying behavior?

What major psychological processes influence consumer responses to the marketing program?

How do consumers make purchasing decisions?

In what ways do consumers stray from a deliberate rational decision process?

Hariyali Kisaan Bazaar: Connecting with Customers

Consumer Behavior

Consumer behavior is the study of how individuals, groups, and organizations select, buy, use, and dispose of goods, services, ideas, or experiences to satisfy their needs and wants.

What Influences Consumer Behavior?

Cultural Factors

Social Factors

Personal Factors

What Is Culture?

Culture is the fundamental determinant of a person’s wants and behaviors acquired

through socialization processes with family and other key institutions.

Subcultures

Nationalities Religions Racial groups Geographic regions

Social Classes

A1

A2

B1

B2

C

D

E1

E2

Social Factors

Reference groups

Family

Social roles

Statuses

Reference Groups

Membership groups Primary groups Secondary groups Aspirational groups Disassociative groups

Family

Family of orientation: parents and siblings Family of procreation: spouse and children

Personal Factors

Age Life cycle stage Occupation Wealth

Personality Values Lifestyle Self-concept

Age and Stage of Lifecycle

Occupation and Economic CircumstancesMarketers try to identify the occupational groups that have above-average interest in their products and services. Product and brand choice are also affected by economic circumstances—spendable income, savings and assets, debts, borrowing power, and attitudes toward spending and saving—to a great extent.

Personality

Personality refers to a set of distinguishing human psychological traits that lead to relatively consistent and enduring responses to environmental stimuli. Personality can be a useful variable in analyzing consumer brand choices.

Brand Personality

Sincerity Excitement Competence Sophistication Ruggedness

Lifestyle and Values

Figure 5.1 Model of Consumer Behavior

Motivation

Freud’sTheory

Behavioris guided by subconsciousmotivations

Maslow’sHierarchyof Needs

Behavioris driven by

lowest, unmet need

Herzberg’sTwo-Factor

Theory

Behavior isguided by motivating

and hygienefactors

Maslow’s Hierarchy

Source: A. H. Maslow, Motivation and Personality, 3rd ed. (Upper Saddle River, NJ: Prentice Hall, 1987). Printed and electronically reproduced by permission of Pearson Education, Inc., Upper Saddle River, NJ.

Perception

Selective attention Selective retention Selective distortion Subliminal perception

Learning

Drive: A strong internal stimulus impelling action Cue: Minor stimuli that determine when, where, and how a person responds Discrimination: Learning to recognize differences in sets of similar stimuli and adjusting our responses accordingly

Emotions

Memory

Short term memory Long term memory

Figure 5.3 Hypothetical LIC Mental Map

Figure 5.4 Consumer Buying Process

Problem Recognition

Information Search

Evaluation of alternatives

Purchase Decision

Postpurchase Behavior

Sources of Information

CommercialPersonal

Public Experiential

Figure 5.5 Successive Sets in Decision Making

Table 5.3 A Consumer’s Brand Beliefs about Laptop Computers

Figure 5.6 Steps Between Alternative Evaluation and Purchase

Non-Compensatory Models of Choice

Conjunctive Lexicographic Elimination-by-aspects

Perceived Risk

Functional Physical Financial Social Psychological Time

Figure 5.7 How Customers Use or Dispose of Products

Source: Jacob Jacoby, et al., “What about Disposition?” Journal of Marketing (July 1977), p. 23. Reprinted with permission from the Journal of Marketing, published by the American Marketing Association.

Low-Involvement Decision Making

Elaboration Likelihood Model Central Route Peripheral route

Decision Heuristics

Availability Representativeness Anchoring and adjustment

Framing

Choice architecture Nudge

Mental Accounting

Consumers tend to: Segregate gains Integrate losses Integrate smaller losses with larger gains Segregate small gains from large losses

For Review

How do consumer characteristics influence buying behavior?

What major psychological processes influence consumer responses to the marketing program?

How do consumers make purchasing decisions?

In what ways do consumers stray from a deliberate rational decision process?