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Definition of Consumer

Behavior

Individuals or groups acquiring,


using and disposing of products,
services, ideas, or experiences
Includes search for information and
actual purchase
Includes an understanding of
consumer thoughts, feelings, and
actions

Acquisition, Consumption
and Disposal

Acquisition

Receiving
Finding
Inheriting
Producing
purchasing

Consumption

Collecting
Nurturing
Cleaning
Preparing
Displaying
Storing
Wearing
Sharing

Acquisition, Consumption,
Disposal

Disposal

Giving
Throwing away
Recycling
depleting

Contributing Disciplines

Anthropology
Sociology
Psychology
Economics
History
Political Science

Reasons for Studying


Consumer Behavior

To stay in business by attracting


and retaining customers
To benefit from understanding
consumer problems
To establish competitive advantage
because it is interesting!

The Circle of Consumption

Production
Acquisition
Consumption
Disposal

The Circle of Consumption,


continued

Typically, attention of marketers has focused


on acquisition as the critical phase
Only recently has more attention been given to
include the full circle and the links between its
elements

Disposal to acquisition
Disposal to production
Disposal to consumption
Production to consumption
Acquisition to consumption
Acquisition to disposal

Consumer Research
The systematic and objective
process of gathering, recording,
and analyzing data for aid in
understanding and predicting
consumer thoughts, feelings, and
behaviors.
In a global environment, research
has become truly international.

Important Factors in
Consumer Research

Speed
The Internet
Globalization
Data Overload

Types of Consumer
Research

Basic Research

To expand knowledge about


consumers in general

Applied Research

When a decision must be made about


a real-life problem

The Consumer Research


Process

Defining the Problem and Project


Scope
The Research Approach
The Research Design
Data Collection
Data Analysis and Interpretation
Report

Marketing Management
Philosophies

Production Concept
Product Concept
Selling Concept
Marketing Concept
Societal Marketing Concept

Green Marketing
Cause-Related Marketing
De-Marketing

Production Concept

Focus on Production
View of consumers:

They will buy as long as the product is


available and affordable.
Model T: You can have any color as long as
its black.

Focus on production justified:

Demand higher than supply


Non-competitive product cost

Product Concept

Focus on the product


View of consumers:

We have to have the best quality and the most


features and they will buy.

Consumers might
Consumers might
the best quality
Consumers might
quality difference
Consumers might

not care about quality


not be willing to pay for
not be able to discern
prefer simplicity

Selling Concept

Focus on selling
View of consumers:

We have to sell to them or else they


wont buy.

Focus on selling justified:

Introductory stages of product life


cycle
Unsought goods

Marketing Concept

Focus on marketing

Creating mutually rewarding


exchange relationships
Consumer needs and wants have
priority

View of consumers:

They will buy if you fulfill their needs


better than the competition.

Societal Marketing
Concept

Same as Marketing Concept plus


an added concern for the wellbeing of society

Market Research:
Research Designs

Exploratory Research
Descriptive Research
Causal Research

Exploratory Research

Literature Research
Experience Survey

Focus Groups
In-Depth Interviews

Exploratory Research

Insights and Ideas


Precision: Specific Hypotheses
Establishment of Priorities
Increase of Familiarity with
Problem
Clarification of Concepts

Descriptive Research

Description of Characteristics of a
Certain Group
Estimation of the Proportion of
People in a Specified Population
who Behave in a Certain Way
Specific Predictions

Descriptive Research

Longitudinal Studies

True Panel
Omnibus Panel

Cross-Sectional Analysis

Field Study
Sample Survey

True Panel: Advantages

Brand Switching Analysis


Collecting Classification
Information
Compensation for
Participation/Time
Accuracy
Reduced Interaction Bias

True Panel: Disadvantages

Non-Representativity
Drop-out Rate
Payment

Causal Research

Laboratory Experiments
Field Experiments
Internal and External Validity

Market Segmentation
Bases

Demographic
Geographic
Geo-Demographic
Benefit
Usage
Lifestyle

Market Segmentation:
Advantages

Specific Definition of the Market


Satisfaction of Consumer Needs
Meeting Changing Market Demands
Assessment of Competitive Strengths
and Weaknesses
Efficient Allocation of Marketing
Resources
Precise Setting of Marketing Objectives

Haley, 1968
Toothpaste Market

Sensory Segment
Worrier Segment
Sociable Segment
Independent Segment

Applications of Benefit
Segmentation

Positioning
Repositioning
Competitive positioning
New market opportunities/niches
Positioning of multiple brands

Usage Segmentation

Rate of Usage
Brand Loyalty
Usage Situation

Lifestyle Segmentation
Psychographics

Activities
Interests
Opinions
Demographics
VALS I and II

Maslows Hierarchy of Needs

Consumer Decision
Making:
Extensive Problem Solving
Types of Decisions

Limited Problem Solving


Routinized Response Behavior

Problem Recognition:
Causes in Current State

Depletion of Stock
Dissatisfaction
Decrease in Finances
Increase in Finances

Problem Recognition:
Causes in Desired State

New Need Circumstances


New Want Circumstances
New Product Opportunities
Purchase of Other Products

Information Search
and Evaluation

Incidental
Learning

Directed Search
and Evaluation

Internal only

loyalty
impulse

Internal and
External

Purchasing Process

When to buy?
Where to buy?
How to pay?
How much to buy?

Post-purchase Behavior

Cognitive Dissonance
Satisfaction/Dissatisfaction

Motivation

Definition
Categories of Needs
Arousal of Motives
Motive Structuring
Motive Conflict
Motivation Theories

Motivation Theories

Freud
Lewin
Maslow

Freudian Theory

Basic Principles

Homeostasis
Hedonism

The Structure of Personality

Id
Ego
Super-ego

Projective Techniques

Word Association
Sentence Completion
Cartoon Test
Thematic Apperception Test (TAT)
Rorschach Test (inkblots)

Lewins Field Theory

Life Space
Person
Environment
Formula
Conflict

Approach-Approach
Avoidance-Avoidance
Approach-Avoidance

Perception

Definition
Threshold Levels
The Perceptual Process

Selection
Organization
Interpretation

Selection

Internal Factor

Attitudes
Expectations
Motives
Attention Span
Perceptual Defense
Perceptual Vigilance
Adaptation
Perceptual Blocking

External Factors

Color
Contrast
Size
Position
Intensity/Magnitude
Movement
Humor
Fear

Organization

Closure
Figure and Ground

Interpretation

Physical Appearance
Stereotypes
Irrelevant Cues
First Impressions
Jumping to Conclusions
Halo Effect

Learning

Definition
Learning Theories
Marketing Applications

Learning Theories

Behavioral Learning Theories

Classical Conditioning
Instrumental Conditioning

Cognitive Learning Theories

Consumer Information Processing

The Structure of the Memory


Memory Processes

Marketing Applications

Classical Conditioning

Creating Associations
Stimulus Generalization

Family Branding
Product Line Extensions
Licensing
Look Alike Packaging

Marketing Applications

Instrumental Conditioning

Rewards
Reinforcement Schedules/Advertising

Intermittent
Continuous

Involvement

High Involvement
Hierarchy of
Effects

Low Involvement
Hierarchy of
Effects

Cognition
Attitude
Behavior

Cognition
Behavior
Attitude

Communication

The Nature of Communication


Communication Model

Sender
Message
Receiver
Psychological Noise

Sender

Source Credibility

Trustworthiness
Expertise
Status
Other Dimensions

The Sleeper Effect

The Sleeper Effect

Consumer forget the source of the


message faster than the message itself.
Over time, high-credibility sources lose
power to change attitudes.
Over time, low-credibility sources gain
power to change attitudes.
High-credibility sources need to reinstate
message.
Low-credibility sources should not
reinstate message.

Message

Size, Color, Position


Order of Presentation
Humor
Agony Advertising
Content
Fear Appeals (moderate!)
Audience Participation

Order of Presentation

Climax order
Anticlimax order
Pyramidal order
What works best, depends on
consumer involvement.

Receiver

Selective Attention
Selective Perception
Selective Appeal

Cultural Dynamics

Definition of Culture
Cultural Sensitivity
Culture and its Elements

Material Culture
Social Institutions
Humans and the Universe
Aesthetics
Language

Culture Defined

The sum total of knowledge, beliefs,


art, morals, laws, customs, and any
other capabilities and habits required
by humans as members of society.
The distinctive way of life of a group
of people, their complete design for
living, a mosaic of human life.

Subculture

Definition
Types of Subcultures
Selected Subcultures
Acculturation

the Learning of another


Culture/Subculture

Types of Subcultures

Nationality
Religion
Region
Ethnicity
Age
Gender
and many more.

Stages of Acculturation

Honeymoon
Rejection
Tolerance
Integration

Social Groups

Definition
Types of Groups
Group Properties

Types of Groups

Primary and secondary


Formal and informal
Membership and symbolic
In and out

Group Properties

Status
Roles
Norms (Sanctions)
Power
Socialization

Power

Reward
Coercive
Legitimate
Referent
Expert

Reference Groups

Influence on product category choice


Influence on brand choice
Factors:

Luxuries vs. necessities


Publicly vs. privately consumed
Visibility