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Consumer Markets

&
Consumer Buying
Behavior
Chapter 05

Topics to be Covered--- What are Consumer Markets?


What is Consumer Buying Behavior?
Model of Consumer Behaviour.
Characteristics Affecting Consumer Behavior.
Types of Buying Decision Behaviour.
The Buying Decision Process.
The Buying Decision Process for New product.

1.
Consumer
Markets
All the individuals and
house hold who buy or
acquire
goods
or
services for personal
consumption.

2.
Consumer
Buying
Behavior
The buying behavior of
final
consumer
--individuals
and
households that buy
goods and services for
personal consumption.

Attitud
e

Behavio
r

3.
Model of
Consumer
Behavior
A way to understand that why consumer
purchase????

A customer make many buying decision daily.


The ultimate purpose of the marketing efforts is to influence buying
decision of customer.
A company can easily identify that what customer buy, when customer
buy, where customer buy, how and how much customer buy.
Butt a single most important question is that
buy?

WHY

a customer

For answering this question company need to go deep in customer's


mind.
Often consumer dont know that why they are purchasing something or
why they are not purchasing.
We can measure the effectiveness of input to consumer buying
decision.
How an internal or external stimuli changed in a behavior is important.

A TV commercial was
advertised for Nokia
Lumia
910
last
month.

But why
customer
behave in such
a manner
against a TV
commercial ,
this is
important to be
noted.

Nokia Lumia 910,


5000 units sold in
Pakistan last month.

4.
Characteristics
Affecting Consumer
Behavior
These factors strongly influenced consumer behavior,
although these are not in control of marketers but they
must take them into account.

Culture Factors
1. Culture
Culture is the learned values, perceptions, wants, and behavior from
family and other important institutions. [Pakistans Culture]

2. Sub- Culture
Subculture are groups of people within a culture with shared value
systems based on common life experiences and situations. [Punjabs
Culture]
Hispanic
African American
Asian
Mature consumers

Culture Factors.
3. Social Classes
Social classes are societys relatively permanent and ordered divisions
whose members share similar values, interests, and behaviors
Measured by a combination of occupation, income, education, wealth,
and other variables.
1. Upper Class
2. Upper-middle Class
3. Middle Class
4. Lower Class/Working Class

Social Factors
1. References Groups
Membership groups, Inspirational Groups, Reference Groups
Word of mouth influence and Buzz marketing
Opinion leaders are use as brand ambassadors.
Online social groups are also play their part and Include blogs, social
networking sites (Face Book), virtual worlds (second life)

2. Family
Family is the most important consumer-buying organization in society.

3. Roles and Status


Social roles and status are the groups, family, clubs, and organizations that
a person belongs to that can define role and social status.

Personal Factors
1. Age and Life Cycle Stage
RBC Royal Bank stages
Youthyounger than 18
Getting started18-35
Builders35-50
Accumulators5060
Preserversover 60

2. Occupation
Occupation affects the goods and services bought by consumers.
Profession: [i.e. Salaried Person or Businessman]

Personal Factors .
3. Economic Situation
Economic situation includes trends in:
1. Personal income
2. Spending
3. Savings
4. Interest Rates

4. Life Style
Lifestyle is a persons pattern of living as expressed in his or her
psychographics
. Measures a consumers AIOs (activities, interests, opinions) to capture
information about a persons pattern of acting and interacting in the
environment. [Top Business Executives --- Jinnah Bagh, Chenab Club]

Personal Factors .
5. Personality and Self Concept
Personality refers to the unique psychological characteristics
that lead to consistent and lasting responses to the
consumers environment [Chen One --- upscale life style ]
e.g. Aggressiveness
Dominance
Self-confidence

Psychological Factors
1. Motivation
A motive is a need that is sufficiently pressing to direct the person to seek
satisfaction. [Constructing or Renovating House]
Safety need, Social needs, Esteem needs, Self actualization needs.
Motivation research refers to qualitative research designed to probe consumers
hidden, subconscious motivations.

2. Perception [TV Commercials, Advertising Boards]


Perception is the process by which people select, organize, and interpret information
to form a meaningful picture of the world , from three perceptual processes

Selective attention
Selective distortion
Selective retention

Psychological Factors .
3. Learning
Learning is the change in an individuals behavior arising from experience.
[Fast food is not good for health]

4. Beliefs and Attitudes


Belief is a descriptive thought that a person has about something based on:
Knowledge
Opinion
Faith
E.g. Music is UN-ISLAMIC.
E.g. coffee tastes good.

Attitudes describe a persons relatively consistent evaluations, feelings, and


tendencies toward an object or idea.
E.g. Chinese products are of inferior quality.
E.g. High Advertising companies offers goods /services with low quality.

5.
Types of Buying
Decision Behavior
Some purchases are simple and routine, even habitual.
Other are far more complex __ involving extensive
information gathering and evaluation __ and are subject
to something subtle/slight influences.
For Example, think of all that goes into a new car
buying decision.

Buying behavior differs greatly for a Tube of toothpaste, an I Phone,


Financial Services and a new car.

High Involvement

Low Involvement

Significan
ce
difference
s between
Brands

Complex Buying
Behavior

Variety Seeking
Buying Behavior

Few
difference
s between
Brands

Dissonancereducing Buying
Behavior

Habitual Buying
Behavior

1. Complex Buying Behavior


Consumer buying behavior in situations characterized by high
consumer involvement in a purchase and significant perceived
differences among brands.
Consumer be highly involve where product is Expensive, Risky,
Purchased Infrequently.
E.g.
A PC/Car/Mobile buyer may not know what attributes to consider.
First a learning process would be carried, then consumer would buy the
product.

2. Dissonance-reducing Buying Behavior


Consumer buying behavior in situations characterized by high
consumer involvement in a purchase but few perceived differences
among brands.
Consumer be highly involve where product is Expensive, Risky,
Purchased Infrequently.
E.g.
A consumer buying a Air Conditioner, Furniture, Curtain material.

3. Habitual Buying Behavior


Consumer buying behavior in situations characterized by Low
consumer involvement in a purchase but few perceived differences
among brands.
Low cost frequently purchased items.
Because consumer is less involved in purchase, he/she will go to store
for purchasing a certain brand for that item and making it habit to
purchase that, note that this is habit not customer loyalty.
E.g.
Salt, Match Box

4. Variety Seeking Buying Behavior


Consumer buying behavior in situations characterized by Low
consumer involvement in a purchase but Significant perceived
differences among brands.
Consumer will do lot of brand switching, because he/she is not highly
involved in purchase and items are less expensive.
E.g.
Chips, Biscuits.

6.
The Buyer Decision
Process
The actual purchase decision is just part of a much larger buying
process ___ starting with need recognition through how you feel after
making the purchase.
Marketer want to be involved throughout the buyer decision
process.

The buying process starts long


before the actual purchase and
continues long after. In fact, it
might result in a decision not to
buy.
Therefore, marketers must focus
on the entire buying process, not
just purchase decision.

Need
Recognition

Occurs when
the
buyer
recognizes a
problem
or
need
triggered by:
Internal
stimuli
External
stimuli

Feeling Hunger,
wana eat
Zinger Burger

Evaluation
of
Alternative
s

Information
Search
1.Personal
Sources
Family and
Friends
2.Commercial
Sources
Advertising,
Internet
3.Public
Sources
Mass media,
Consumer
organizations
4.Experiential
Sources
Handling,
Examining,
Using the
product
KFC
MacDonald's
Fri-Chicks
AFC

In
the
evaluation
stage,
the
customer must
choose between
the alternative
brands,
products
and
services.
How does the
customer use
the
information
obtained?
A.
B.

High
Involvement
Purchase
Low
Involvement
Purchase

KFC

Purchase
Decision

The act by
the consumer
to buy the
most
preferred
brand
The purchase
decision can
be
affected
by:
Attitudes of
others
Unexpected
situational
factors
Purchased n
Eat

Post
Purchase
Behavior
The satisfaction or
dissatisfaction
that
the consumer feels
about the purchase.
Relationship between:
Consumers expectations
Products
perceived
performance

The larger the gap


between expectation
and performance, the
greater
the
consumers
dissatisfaction
Cognitive dissonance
is
the
discomfort
caused by a post
purchase conflict.
Customer
Satisfaction
Nothing like a
KFCs Zinger.

The Buyer Decision Process ---- Brand Loyalty

Need
Recognition

Feeling
hunger, wana
eat zinger
burger.

Purchase
Decision

Purchased and
Eat.

7.
The Buyer Decision
Process for New Product
[Adoption Process]
Adoption process is the mental process an individual goes through from
first learning about an innovation to final regular use.

Awareness
Online Advertising of
Apple iPad
An alternative to
laptops

Interest
Dont want to carry
laptop, and want to
play application.

Evaluation
Will inquire from call
centers, online sources,
company
website,
users opinion,
Expected
cost,
specifications

Adoption
Trial
Purchase
Apple iPad

I will be the loyal


customer for
Apple innovative
products.