Part Four Target Markets and Customer Behavior 9

Part Four Target Markets and Customer Behavior 9 Consumer Buying Behavior

Objectives 1. To understand consumers’ level of involvement with a product and the types of consumer problem-solving processes 2. To recognize the stages of the consumer buying decision process 3. To explore how situational influences may affect the consumer buying decision process 4. To understand the psychological influences that may affect the consumer buying decision process 5. To examine the social influences that affect the consumer buying decision process Copyright © Houghton Mifflin Company. All rights reserved. 9 | 2

Chapter Outline • Level of Involvement and Consumer Problem-Solving Processes • Consumer Buying Decision Process • Situational Influences on the Buying Decision Process • Psychological Influences on the Buying Decision Process • Social Influences on the Buying Decision Process Copyright © Houghton Mifflin Company. All rights reserved. 9 | 3

Introduction: Key Terms • Buying Behavior – The decision processes and acts of people involved in buying and using products • Consumer Buying Behavior – Buying behavior of people who purchase products for personal use and not for business purposes Copyright © Houghton Mifflin Company. All rights reserved. 9 | 4

Level of Involvement and Consumer Problem-Solving Processes • Level of Involvement – An individual’s intensity of interest in a product and the importance of the product for that person • Enduring involvement • Situational involvement • Routinized Response Behavior – The process used when buying frequently purchased, low-cost items that require little search-and-decision effort Copyright © Houghton Mifflin Company. All rights reserved. 9 | 5

Level of Involvement and Consumer Problem-Solving Processes (cont’d) • Limited Problem Solving – The process that buyers use when purchasing products occasionally or when they need information about an unfamiliar brand in a familiar product category • Extended Problem Solving – The process employed when purchasing unfamiliar, expensive, or infrequently bought products • Impulse Buying – An unplanned buying behavior resulting from a powerful urge to buy something immediately Copyright © Houghton Mifflin Company. All rights reserved. 9 | 6

Consumer Buying Decision Process and Possible Influences on the Process FIGURE 9. 1 Copyright

Consumer Buying Decision Process • Problem Recognition – Occurs when a buyer becomes aware of a difference between a desired state and an actual condition – May occur rapidly or slowly • Information Search – Internal search • Buyers search their memories for information about products that might solve their problem – External search • Buyers seek information from outside sources Copyright © Houghton Mifflin Company. All rights reserved. 9 | 8

This Visine Advertisement Is Focused On Problem Recognition Courtesy of Pfizer, Inc. Copyright ©

Consumer Buying Decision Process (cont’d) • Evaluation of Alternatives – Consideration set • A group of brands that the buyer views as alternatives for possible purchase – Evaluative criteria • Objective and subjective characteristics that are important to a buyer – Framing the alternatives • Describing the alternatives and their attributes in a certain manner to make a particular characteristic appear more important especially to the inexperienced buyer Copyright © Houghton Mifflin Company. All rights reserved. 9 | 10

Consumer Buying Decision Process (cont’d) • Purchase – Choosing the product or brand to be bought based on the outcome of the evaluation stage – The choice of seller may affect the final product selection. – Factors such as terms of sale, price, delivery, and warranties may affect the sale. Copyright © Houghton Mifflin Company. All rights reserved. 9 | 11

Consumer Buying Decision Process (cont’d) • Postpurchase Evaluation – Cognitive dissonance • A buyer’s doubts shortly after a purchase about whether the decision was the right one – Buyers are most likely to seek reassurance after the purchase of an expensive, highinvolvement product Copyright © Houghton Mifflin Company. All rights reserved. 9 | 12

What Part of the Consumer Buying Decision Process Does This Olay Ad Focus On?

On Which Stage(s) of the Consumer Buying Decision Does This NAPA Ad Focus? Courtesy

Class Exercise In which stage of the consumer buying decision process are each of the following people? 1. A recent college graduate reads Consumer Reports to compare automobile ratings. 2. On the first day of class, a student finds out that a programmable calculator is needed for the course, but she doesn’t own one. 3. After purchasing an evening gown, a woman decides that it is not quite appropriate for her special occasion. Copyright © Houghton Mifflin Company. All rights reserved. 9 | 15

Class Exercise 4. A car buyer gets a loan to purchase a new car. 5. A teenager compares numerous compact disc players and narrows the choice down to two players. 6. While on the way to work, a person’s automobile stalls and will not start again. 7. At an open-house party, a guest realizes that the host already owns the gift he plans to give. 8. A person receives a sample package of laundry detergent in the mail and uses it to wash a load of clothes. Copyright © Houghton Mifflin Company. All rights reserved. 9 | 16

Situational Influences on the Buying Decision Process • Situational Influences – Factors that can influence a buyer’s purchase decision and may cause the buyer to shorten, lengthen, or terminate the process. • Situational Factors – – – Physical surroundings Social surroundings Time perspective Reason for purchase Buyer’s momentary mood and condition Copyright © Houghton Mifflin Company. All rights reserved. 9 | 17

Psychological Influences on the Buying Decision Process • Psychological Influences – Factors that in part determine people’s general behavior, thus influencing their behavior as consumers • Perception – The process of selecting, organizing, and interpreting information inputs to produce meaning Copyright © Houghton Mifflin Company. All rights reserved. 9 | 18

Psychological Influences on the Buying Decision Process (cont’d) • Selective Exposure – The process of selecting inputs to be exposed to our awareness while ignoring others • Selective Distortion – An individual’s changing or twisting of information when it is inconsistent with personal feelings or beliefs • Selective Retention – Remembering information inputs that support personal feelings and beliefs and forgetting inputs that do not Copyright © Houghton Mifflin Company. All rights reserved. 9 | 19

Psychological Influences on the Buying Decision Process (cont’d) • Perceptual Organization – Organizing and integrating new information with what is already stored in memory. • Closure occurs when a person mentally fills in missing elements in a pattern or statement Copyright © Houghton Mifflin Company. All rights reserved. 9 | 20

Psychological Influences on the Buying Decision Process (cont’d) • Interpretation – The assignment of meaning to what has been organized based on what is expected or what is familiar – Attempts by marketers to influence interpretation can fail because • consumers block out seller’s information. • consumers interpret seller’s information differently than intended. • consumers discard information that is inconsistent with prior beliefs. Copyright © Houghton Mifflin Company. All rights reserved. 9 | 21

Psychological Influences on the Buying Decision Process (cont’d) • Motives – An internal energizing force that directs a person’s behavior toward satisfying needs or achieving goals • Maslow’s Hierarchy of Needs – The five levels of needs that humans are motivated to seek and satisfy, from least to most important are • • • Physiological needs—food, water, sex, clothing, shelter Safety needs—security, freedom Social needs—love, affection, belonging Esteem needs—respect, recognition, self-worth Self-actualization needs—personal growth needs Copyright © Houghton Mifflin Company. All rights reserved. 9 | 22

Maslow’s Hierarchy of Needs Maslow believed that people seek to fulfill five categories of

Psychological Influences on the Buying Decision Process (cont’d) • Learning – Changes in an individual’s thought processes and behavior caused by information and experience – Behaviors that produce satisfying consequences are likely to be repeated. • Consumers learn about products by – experiencing the products personally. – gaining additional product knowledge from sellerprovided information. – indirect information from other purchasers/users. Copyright © Houghton Mifflin Company. All rights reserved. 9 | 24

Psychological Influences on the Buying Decision Process (cont’d) • Attitudes – An individual’s enduring evaluation of, feelings about, and behavioral tendencies toward an object or idea • Attitudinal Components – Cognitive • Knowledge and information about the object or idea – Affective • Feelings and emotions toward the object or idea – Behavioral • Individual’s action regarding the object or idea Copyright © Houghton Mifflin Company. All rights reserved. 9 | 25

Psychological Influences on the Buying Decision Process (cont’d) • Attitude Scale – A means of measuring consumer attitudes by gauging the intensity of individuals’ reactions to adjectives, phrases, or sentences about an object Copyright © Houghton Mifflin Company. All rights reserved. 9 | 26

Psychological Influences on the Buying Decision Process (cont’d) • Personality and Self-Concept – Personality • A set of internal traits and distinct behavioral tendencies that result in consistent patterns of behavior in certain situations – Self-concept (self-image) • Perception or view of oneself • Lifestyles – Lifestyle • An individual’s pattern of living expressed through activities, interests, and opinions Copyright © Houghton Mifflin Company. All rights reserved. 9 | 27

Social Influences on the Buying Decision Process • Social Influences – The forces other people exert on one’s buying behavior • Role – Actions and activities that a person in a particular position is supposed to perform based on expectations of the individual and surrounding persons – Multiple role-expectation sets affect behavior. – Roles influence both general and buying behaviors. Copyright © Houghton Mifflin Company. All rights reserved. 9 | 28

Social Influences on the Buying Decision Process (cont’d) • Family Influences – Consumer socialization • The process through which a person acquires the knowledge and skills to function as a consumer • Family decision-making processes – – Autonomic—equally shared decision-making Husband-dominant—husband makes decisions Wife-dominant—wife makes decisions Syncratic—decisions made jointly Copyright © Houghton Mifflin Company. All rights reserved. 9 | 29

Percent Who Decide or Influence Purchase Decisions Age Group of Decision Makers or Influencers Product Category of Purchase Decision Ages 8 -12 Ages 13 -21 Clothing/apparel 93% 89% Movie/Video/DVD 93% 87% Video games/systems 87% 78% Groceries 84% Sports equipment 71% 65% Vacation 62% 69% Software 57% 77% Vehicles 22% 61% Source: Harris Interactive Youth. Pulse, 2003, as reported in American Demographics, December 2003/January 2004, p. 16. Copyright © Houghton Mifflin Company. All rights reserved. 9 | 30

Social Influences on the Buying Decision Process (cont’d) • Reference Groups – Any group that positively or negatively affects a person’s values, attitudes, or behavior • Membership • Aspirational • Disassociative • Opinion Leader – A knowledgeable, accessible individual who provides information about a specific sphere of interest to followers Copyright © Houghton Mifflin Company. All rights reserved. 9 | 31

How Do Reference Groups Affect Purchase Decisions? For each of the products below, indicate whether one’s reference group would influence one’s decision to buy the product in general, the type of product within the category, and/or the brand decision. Use more than one X when appropriate. Product Decision Type of Product Within the Category Brand Decision Soft drink Bar soap Telephone Jeans Car Sweatshirt with college name DVD player Bathroom tissue Copyright © Houghton Mifflin Company. All rights reserved. 9 | 32

Debate Issue • Is it appropriate for marketers to specifically target children in their

Social Influences on the Buying Decision Process (cont’d) • Social Class – An open group of individuals with similar social rank – Individuals in the same social class • develop and assume common behavioral patterns. • have similar attitudes, values, language patterns, and possessions. – Influences many major life decisions – Influences shopping patterns and spending habits Copyright © Houghton Mifflin Company. All rights reserved. 9 | 34

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Copyright © Houghton Mifflin Company. All rights reserved. 9 | 36

Social Influences on the Buying Decision Process (cont’d) • Culture – The accumulated values, knowledge, beliefs, customs, objects, and concepts of a society • Culture influences buying behavior. • Cultural changes affect product development, promotion, distribution, and pricing. • Subcultures – Groups of individuals whose characteristic values and behavior patterns are similar and differ from those of the surrounding culture • African American • Hispanic Copyright © Houghton Mifflin Company. All rights reserved. • Asian American 9 | 37

Subcultural Differences in Movie-Going Behavior In what ways can movie theater marketers use this information? Source: “Now Playing, ” American Demographics, September 2001, p. 14. Copyright © Houghton Mifflin Company. All rights reserved. 9 | 38

Class Exercise Imagine that you are going out tonight. Which of the following social influences will determine what you wear, where you go, what you do, and what you will buy or consume? 1. Your role as a student, family member, employee, church member, or fraternity or sorority member. 2. Identification with a positive reference group. Disassociation from a negative reference group. Copyright © Houghton Mifflin Company. All rights reserved. 9 | 39

Class Exercise (cont’d) 3. Membership within a particular social class. Aspirations to be in a different social class. 4. Cultural values that accept or reject certain types of behavior. Gender roles: expectations of how men and women should act. 5. Membership in a subculture based on geography, age, or ethnic background. 6. Knowing how these factors affect your consumption behavior, how can marketers adjust their marketing mixes to meet your needs? Copyright © Houghton Mifflin Company. All rights reserved. 9 | 40

Net Sights • Consumerworld. org offers a variety of free information to those interested in consumer buying behavior. Articles and other resources make this an interesting and helpful site for marketers. Visit www. consumerworld. org. Copyright © Houghton Mifflin Company. All rights reserved. 9 | 41

After reviewing this chapter you should: • Understand the level of involvement and types of consumer problem-solving processes • Recognize the stages of the consumer buying decision process • Know how situational influences may affect the consumer buying decision process • Understand the psychological influences that may affect the consumer buying decision process • Be familiar with social influences that affect the consumer buying decision process Copyright © Houghton Mifflin Company. All rights reserved. 9 | 42

Chapter Quiz 1. Which of the following products would probably require extended problem solving before a purchase? a. Products purchased frequently b. Products to be purchased in the future c. Products that are purchased routinely d. Expensive products e. Products purchased as a result of social influences Copyright © Houghton Mifflin Company. All rights reserved. 9 | 43

Chapter Quiz (cont’d) 2. When in their information search, consumers focus on communication with friends and relatives, they are utilizing ______ sources. a. internal b. personal c. marketer-dominated d. direct e. organizational Copyright © Houghton Mifflin Company. All rights reserved. 9 | 44

Chapter Quiz (cont’d) 3. Selective exposure refers to a. targeting only certain parts of the total market. b. admitting only certain inputs into consciousness. c. the circumstances or conditions that exist when a consumer is making a purchase decision. d. the process of selecting, organizing, and interpreting information inputs to produce meaning. e. remembering inputs that support personal feelings and beliefs and forgetting those that do not. Copyright © Houghton Mifflin Company. All rights reserved. 9 | 45

Chapter Quiz (cont’d) 4. Which of the following is the fastest growing, most affluent subculture in the United States? a. African Americans b. Hispanics c. Asian Americans d. Native Americans e. Italian Americans Copyright © Houghton Mifflin Company. All rights reserved. 9 | 46