Consumer Buying Behavior 200

Analyzing
Consumer Markets
Marketing Management, 13
th
ed
6
Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall 6-2
Kotler on
Marketing
The most
important
thing is to
forecast
where
customers
are moving,
and be in
front of them.
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?
How do marketers analyze consumer
decision making?
Figure 6.1
Model of Consumer Behavior
a. Many different factors affect
consumer buying behavior. Buying
behavior is never simple. Understanding
it, however, is the essential task of
marketing management.
b. Consumer buying behavior refers to
the buying behavior of final consumers
individuals and households who buy
goods and services for personal
consumption
c. The consumer market is all the individuals
and households who buy or acquire goods
and services for personal consumption.
1). The American consumer market consists
of about 287 million people.
2). These people consume trillions of dollars
of goods and services each year.
3). The world consumer market consists of
more than 6.2 billion people.
4). Consumers vary tremendously in age,
income, education level, and tastes.
What Influences
Consumer Behavior?
Cultural Factors
Social Factors
Personal Factors
Cultural Factors
b. Cultural factors exert the broadest
and deepest influence on consumer
behavior.
The marketer needs to understand the
role played by the buyers culture, sub-
culture, and social class.
c. Culture is the set of basic values,
perceptions, wants, and behaviors
learned by a member of society from
family and other important institutions.
1). Culture is the most basic cause of a
persons wants and behavior
3). Marketers are always trying to spot
cultural shifts in order to imagine new
products that might be wanted.
Fast Facts About
American Culture
The average American:
chews 300 sticks of gum a year
goes to the movies 9 times a year
takes 4 trips per year
attends a sporting event 7 times each year

d. Each culture contains smaller
subcultures.
Subculture is a group of people with
shared value systems based on common
life experiences and situations.
Subcultures
Nationalities
Religions
Racial groups
Geographic regions
Many of these subcultures make up
important market segments and many
times products are designed for them.
Examples of important subcultural
groups include:
1). Hispanic consumers. There are 35 million
consumers in this group, they spend $425 billion
on goods and services. This group is very brand
loyal and favor companies who show interest in
them.
2). African American consumers. This group
has a tremendous purchasing power. This group
has a buying power of $527 billion and, if they
were a separate nation, would rank among the
top 15 in the world. This group is growing in
affluence and sophistication. Some companies
have developed special products, packaging,
and appeals for this group. They appear to be
very price conscious, are motivated by quality
and selection, and emphasize brand name and
loyalty.
3). Asian American consumers. This
group is the fastest-growing and most
affluent U.S. demographic segment and
now number more than 10 million with
disposable income of $229 billion annually.
Language and cultural tradition appear to
be the largest barrier to effectively
marketing to this group. Because of its
rapid growth, however, this group will
receive increased attention from marketers.
Social class
Social Factors
Reference
groups
Social
roles
Statuses
Family
f. Almost every society has some form of social
class structure.
Social class is the relatively permanent and
ordered divisions in a society whose members
share similar values, interests, and behaviors.

1). Social class is not determined by a single
factor such as income but is measured as a
combination of occupation, income, education,
wealth, and other
variables.
2). Social scientists have identified seven
American social classes: (See Table 6.1)
a). Upper Uppers (less than 1 percent).
b). Lower Uppers (about 2 percent).
c). Upper Middles (about 12 percent).
d). Middle Class (about 32 percent).
e). Working Class (about 38 percent).
f). Upper Lowers (about 9 percent).
g). Lower Lowers (about 7 percent).
Table 7.1: Characteristics of Major U.S. Social Classes
See text for complete table
1. Upper Uppers
(less than 1%)
The social elite who live on inherited wealth. They give
large sums to charity, run the debutante balls, maintain
more than one home, and send their children to the finest
schools. They are a market for jewelry, antiques, homes,
and vacations. They often buy and dress conservatively.
Although small as a group, they serve as a reference
group to the extent that their consumption decisions are
imitated by the other social classes.
2. Lower Uppers
(about 2%)
Persons, usually from the middle class, who have
earned high income or wealth through exceptional
ability in the professions or business. They tend to be
active in social and civic affairs and to buy the symbols of
status for themselves and their children. They include the
nouveau riche, whose pattern of conspicuous
consumption is designed to impress those below them.
3). Marketers are interested in social
class because people within a given
social class tend to exhibit similar
behavior, including buying behavior.
This is most evident in the selection of
clothing, home furnishings, leisure
activity, and automobiles.
Social Factors
Reference Groups
Reference groups
Membership groups
Primary groups
Secondary groups
Aspirational groups
Dissociative groups
Opinion leader
Influencing Buyer Behavior
Social Factors
g. A consumers behavior is
influenced by social factors. These
include small groups, family, and
social roles and status
Social Factors
h. A persons behavior is influenced
by many small groups. There are
several specialized group formations
within the larger configuration:
Social Factors
1). Membership groups are groups that have
a direct influence on a persons behavior;
they are groups to which a person belongs.

2). Reference groups are groups that that
have a direct (face-to-face) or indirect
influence on the persons attitudes or
behavior. People are often influenced by
reference groups to which they do not belong.
-Aspirational groups
-Dissociative groups
- Primary groups
-Secondary groups
-Opinion leader
Social Factors
a). An aspirational group is a group to which an
individual wishes to belong

b). Reference groups expose a person to new
behaviors and lifestyles.

c). Influence the persons attitudes and self-
concept.

d). They also create pressures to conform that
may affect the persons product and brand
choices.
Social Factors
e). An opinion leader is a person within
a reference group who, because of
special skills, knowledge, personality,
or other characteristics, exert influence
on others. Marketers try to identify
opinion leaders and direct products
and communications toward them.
Family
Family of procreation
Family of orientation
Roles and Statuses
Role
Status
Social Factors
i. A consumers purchases are also
influenced by family members. The
influence can be very strong because
the family is the most important
consumer-buying organization in
society. It has been extensively
researched.
Family
k. A person belongs to many groups
and the persons position within each
group can be defined in terms of both
role and status. A role is the activities a
person is expected to perform
according to the people around him or
her. Status is the general esteem given
to a role by society. People often
choose products that show their
status in society.
Table 7.2: Stages in the Family Life Cycle
See text for complete table
1. Bachelor stage:
Young, single, not living
at home
Few financial burdens. Fashion opinion leaders.
Recreation oriented. Buy: basic home equipment,
furniture, cars, equipment for the mating game;
vacations.
2. Newly married
couples:
Young, no children
Highest purchase rate and highest average
purchase of durables: cars, appliances, furniture,
vacations.
3. Full nest I:
Youngest child under six
Home purchasing at peak. Liquid assets low.
Interested in new products, advertised products.
Buy: washers, dryers, TV, baby food, chest rubs
and cough medicines, vitamins, dolls, wagons,
sleds, skates.
4. Full nest II:
Youngest child six or over
Financial position better. Less influenced by
advertising. Buy larger-size packages, multiple-
unit deals. Buy: many foods, cleaning materials,
bicycles, music lessons, pianos.
Roles and Statuses
j. Marketers are interested in the roles
and influence of the husband, wife, and
children in the purchase of different
products and services. Buying roles
change with evolving lifestyles (such
as more females working outside the
home). Marketers try to identify the
influencer role in a family unit (such as
children).
With the graying of the American populace,
marketers have begun to shift images and
cultural references in advertising from things
that are relevant to the twenty-somethings to
images of active seniors, and soundtracks
from the sixties and seventies. Can you
identify any particular
ad campaigns that fit
this pattern?
Personal Factors
Age
Values
Life cycle
stage
Occupation
Personality
Self-
concept
Wealth
Lifestyle
Personal Factors
l. A buyers decisions are also influenced by
personal characteristics such the buyers age
and life-cycle stage, occupation, economic
situation, lifestyle, personality and self-
concept.
m. People change the goods and services
that they buy over their lifetimes. Part of
these changes are shaped by the family life
cycle (stages throughout which families
might pass as they mature over time). The
traditional life cycle stages are being
modified as people form new lifestyles (such
single parenting).
n. A persons occupation affects the goods and
services bought (software bought by accountants,
lawyers, and doctors).

o. The economic situation of the buyer is very
important in purchase consideration. If a person
fears losing their job, their purchasing habits
generally change. If the person perceives that
their economic situation is going to improve, they
might consider making a major purchase.
p. People from the same social strata
can have very different lifestyles. A
lifestyle is a persons pattern of living
as expressed in his or her
psychographics (such as activities,
interests, and opinions). Lifestyle
profiles a persons whole pattern of
acting and interacting in the world. It is
more than the persons social class or
personality.
1). Examples include:
a). Activities (work, hobbies, shopping,
etc.).
b). Interests (food, fashion, recreation,
etc.).
c). Opinions (about themselves, social
issues, business, etc.).
2). The most widely used lifestyle
classification is the SRI Values and Lifestyles
(VALS) typology. VALS classifies people
according to their consumption tendencies
by how they spend their time and money. A
person could change positions over time. It
is felt that a persons lifestyle does affect
their purchase behavior. Groups
are further subdivided based on self-
orientation and resources. (See Figure 6.3)
a). Self-orientation groups include:
1]. Principle-oriented consumers who
buy based on their views of the world.
2]. Status-oriented consumers who
base their purchases on the actions
and opinions of others.
3]. Action-oriented buyers who are
driven by their desire for activity,
variety, and risk taking.
). Resources can be either abundant or
minimal depending on whether the buyer has
high or low levels of income, education,
health, self- confidence, energy, and other
factors. Note: See SRIs Web site at www.sri-
bi.com for additional information. A survey
can be filled out at the site to determine your
SRI VALS position.
q. Each persons personality and self-concept
will influence their buying behavior.
Personality is a persons unique psychological
characteristics that lead to relatively consistent
and lasting responses to his or her own
environment. Personality is usually described
in terms of traits (such as self-confidence,
dominance sociability, etc.). Personality can
be useful for analyzing consumer behavior for
certain brand or product choices.
1). A brand personality is the specific mix of
human traits that may be attributed to a
particular brand.
2). Five brand personalities might be:
a). Sincerity. Down to earth. cheerful.
wholesome
b). Excitement. Daring ,spirited,up-
to-date, imaginative.
c). Competence. Reliable , intelligent and
successful
d). Sophistication. Upper class- charming
e). Ruggedness. tough
Brand Personality
Sincerity
Excitement
Competence
Sophistication
Ruggedness
r. The self-concept describes the self-
image. The basic idea is that peoples
possessions contribute to and reflect their
identities. (how one views oneself)
Key Psychological Processes
Motivation
Memory Learning
Perception
Motivation
Freuds
Theory

Behavior
is guided by
subconscious
motivations
Maslows
Hierarchy
of Needs

Behavior
is driven by
lowest,
unmet need

Herzbergs
Two-Factor
Theory

Behavior is
guided by
motivating
and hygiene
factors
Maslows Hierarchy of Needs
Herzbergs Two-Factor Theory
Perception
Selective Attention
Subliminal Perception
Selective Retention
Selective Distortion
Figure 6.4 Consumer Buying Process
Problem Recognition
Information Search
Evaluation
Purchase Decision
Postpurchase
Behavior
Ernest Dichters research found:
Consumers resist prunes because prunes are
wrinkled looking and remind people of old
age.
Men smoke cigars as an adult version of
thumb sucking.
Women prefer vegetable shortening to animal
fats because the latter arouse a sense of guilt
over killing animals.
Women dont trust cake mixes unless they
require adding an egg, because this helps
them feel they are giving birth.

KEY PSYCHOLOGICAL PROCESSES
The starting point for understanding
consumer behavior is the stimulus-
respons
The marketers task is to understand
what happens in the consumers
consciousness between the arrival of
the outside marketing stimuli and the
ultimate purchase decisions.
A person has many needs at any given time. Some needs are:
Biogenic (arise from physiological states
of tension such as hunger).
Others are psychogenic and arise from a
need for recognition, esteem, or
belonging.
A motive is a need that is sufficiently
pressing to drive the person to act.

Motivation: Freud, Maslow, Herzberg
Sigmund Freud assumed that the
psychological forces shaping peoples behavior are
largely unconscious, and that a person cannot fully
understand his or her own motivations. Freuds Theory
Freuds Theory
A technique called laddering can be used to
trace a persons motivations from the stated
instrumental ones to the more terminal
ones.
Motivation researchers often collect in-
depth interviews to uncover deeper
motives triggered by a product.
Projective techniques such as word association,
sentence completion, and role-playing are used.
Customer 2 is mixed profitability.
Maslows Theory
Abraham Maslow sought to explain
why people are driven by particular
needs at particular times.

Maslows answer is that human needs
are arranged in a hierarchy, from the
most pressing to the least pressing.
In order of importance, they are:

Physiological needs.
Safety needs.
Social needs.
Esteem needs.
Self-actualization needs.
Frederick Herzberg developed a two-
factor theory that distinguishes
dissatisfiers (factors that cause
dissatisfaction) from satisfiers (factors
that cause satisfaction). The absence
of dissatisfiers is not enough; satisfiers
must be present to motivate a
purchase.
Herzbergs Theory
Herzbergs theory has two implications:

Sellers should do their best to avoid
dissatisfiers.

Sellers should identify the major satisfiers
or motivators of purchase in the market
and supply them. These satisfiers will
make the major difference as to which
brand the customer buys.
Perception
How the motivated person actually
acts is influenced by his or her view or
perception of the situation.

Perception is the process by which
an individual selects, organizes, and
interprets information inputs to create a
meaningful picture of the world.
Perception depends not only on the
physical stimuli, but also on the
stimulis relation to the surrounding
field and on conditions within the
individual.
The key point is that perceptions vary
widely among individuals exposed to the
same reality.
In marketing, perceptions are more
important than the reality, as it is
perceptions will affect consumers actual
behavior.
Selective Attention
It has been estimated that a person
is exposed to over 1,500 ads or brand
communications a day. Because a
person cannot possibly attend to all of
these, most stimuli will be screened
outa process called selective
attention.
Selective attention means that
marketers have to work hard to attract
consumers notice.

People are more likely to notice
stimuli that relates to a current
need.

Selective Distortion
Selective distortion is the tendency
to interpret information in a way that will
fit our preconceptions. Consumers will
often distort information to be consistent
with prior brands and product beliefs.
Selective Retention
People will fail to register much information to
which they are exposed in memory, but will
tend to retain information that supports their
attitudes and beliefs.

Because of selective retention, we are
likely to remember good points about a
product we like and forget good points about
competing products.
Learning
Learning involves changes in an
individuals behavior arising from
experience.

Memory
All information and experiences
individuals encounter as they go through
life can end up in their long-term
memory.

These basic psychological processes
play an important role in understanding
how consumers actually make their
buying decisions. Marketers must
understand every facet of consumer
behavior.

THE BUYING DECISION PROCESS: THE FIVE-
STAGE MODEL
Problem Recognition
The buying process starts when the buyer
recognizes a problem or need.

The need can be triggered by internal or
external stimuli.

Marketers need to identify the
circumstances that trigger a particular need
so that they can develop marketing
strategies that trigger consumer interest.

An aroused consumer will be inclined to
search for more information. We can
distinguish between two types of arousal.

The milder state is called heightened
attention where a person simply becomes
more receptive to information about a
product.

The second level is active information
search where a person looks for reading
material, going online, etc. to learn about
the product.
sources to which the consumer will turn
and the relative influence each will have
on the subsequent purchase decision.
These information sources fall into four
groups:

Of key interest to the marketer are the
major information

Personal (family, friends).

Commercial (advertising, Web sites,
salespeople).

Public (mass media, consumer
organizations).

Experiential (handling, examining, using
the product).
Generally speaking the consumer
receives the most information about a
product from commercial sources.

The most effective information often
comes from personal sources or public
sources that are independent
authorities.

The Internet has changed information
search. Most consumers are hybrid
consumers.

The consumer will come to know only
a subset of these brands (awareness
sent).

Some brands will meet initial buying
criteria (consideration set).
Evaluation of Alternatives

No single process is used by all
consumers or by one consumer in all
buying situations. The most current
models see the process as cognitively
orientated.
First, the consumer is trying to satisfy
a need.

Second, the consumer is looking for
certain benefits from the product
solution.

Third, the consumer sees each
product as a bundle of attributes with
varying abilities for delivering the
benefits sought to satisfy this need.
Beliefs and Attitudes
Evaluations often reflect beliefs and
attitudes. Through experience and
learning, people acquire beliefs and
attitudes. These in turn influence buying
behavior.
Belief a descriptive thought that a
person holds about something.

Attitudea persons enduring
favorable or unfavorable evaluation,
emotional feeling, and action
tendencies toward some object or
idea.
Attitudes put people into a frame of
mind.

Attitudes lead people to behave in a
fairly consistent way toward similar
objects.

Attitudes can be very difficult to
change.
Purchase Decisions
In the evaluation stage, the consumer
forms preferences among the brands in
the choice set. The consumer may also
form an intention to buy the most
preferred brand. In executing a
purchase intention, the consumer may
make up to five sub decisions:
Brand.
Dealer.
Quantity.
Timing.
Payment-method.
A consumers decision to modify,
postpone, or avoid a purchase
decision is heavily influenced by
perceived risk. There are many types
of risks that consumers may perceive
in buying and consuming a product:
Functional risk.
Physical risk.
Financial risk.
Social risk.
Psychological risk.
Time risk.

Business organizations
Business organizations do not
only sell. They also buy vast
quantities of raw materials
manufactured , components,
plant and equipment, supplies ,
and business services .
Figure 8.1: Major Influences on
Industrial Buying Behavior
The business market versus the consumer
market

Participants in the Business
Buying Process

1- Environmental Factors
2-Organizational Factors
-Purchasing-Department Upgrading

-Centralized Purchasing

-Decentralized Purchasing of Small Ticket Items

-Internet Purchasing

Major Influences on Buying
Decisions
Figure 6.5 Successive Sets Involved in
Consumer Decision Making
Table 6.4 A Consumers Evaluation of
Brand Beliefs About Laptops
Figure 6.6 Stages between Evaluation
of Alternatives and Purchase
Perceived Risk
Functional
Physical
Financial
Social
Psychological
Time
Figure 6.7 How Customers Use and
Dispose of Products

Consumer Buying Behavior 200

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