Chapter Five

1. Chapter Five Consumer Markets and Consumer Buyer Behavior

2. Consumer Markets and Consumer Buyer Behavior Model of Consumer Behavior Characteristics Affecting Consumer Behavior Types of Buying Decision Behavior The Buyer Decision Process The Buyer Decision Process for New Products Topic Outline

3. Model of consumer behavior • Consumers make many buying decisions everyday and buying decision is the focal point of the marketer’s effort. • Marketers can study actual consumer purchases to find out what they buy, where and how much, but learning the why’s of the consumer buying behavior is not easy- the answer is locked deep within the consumer’s mind

4. Model of Consumer Behavior Consumer buyer behavior refers to the buying behavior of final consumers—individuals and households who buy goods and services for personal consumption Consumer market refers to all of the personal consumption of final consumers

5. Model of Consumer Behavior

6. Buyer characteristics and the buyer decision process are two parts of _______. buyer’s black box buyer’s white box buyer’s red box buyer’s shopping box

7. Buyer characteristics and the buyer decision process are two parts of _______. buyer’s black box buyer’s white box buyer’s red box buyer’s shopping box

8. Characteristics Affecting Consumer Behavior Factors Influencing Consumer Behavior

9. Consumer purchases are influenced by cultural, _______, personal, and psychological characteristics. cost social health profit

10. Consumer purchases are influenced by cultural, _______, personal, and psychological characteristics. cost social health profit

11. Characteristics Affecting Consumer Behavior • Culture is the learned values, perceptions, wants, and behavior from family and other important institutions • Every group or society has a culture and cultural influences on buying behavior may vary greatly from one country to another • Marketers are always trying to spot cultural shifts in order to discover new products that might be wanted

12. Characteristics Affecting Consumer Behavior Subculture are groups of people within a culture with shared value systems based on common life experiences and situations • Hispanic • African American • Asian • Mature consumers

13. Characteristics Affecting Consumer Behavior • Hispanic consumers: one third of the US population • Hispanic consumers tend to buy more branded, higher quality products • African-American consumers: they are motivated by quality and selection. Brands are important

14. Characteristics Affecting Consumer Behavior • Asian American: they are the second fastest growing population sub segment after the Hispanics. • More than 90% of the Asian American Go online regularly and are most comfortable with internet technology such as online banking

15. Characteristics Affecting Consumer Behavior • Mature consumers: very attractive market. The entire U.S baby boom generation, the largest and the wealthiest demographic cohort in the country. • Mature consumers are not stuck in their ways

16. Four examples of subculture groups include Hispanic, African American, Asian American, and ________. middle-class mature consumers RVers echo boomers

17. Four examples of subculture groups include Hispanic, African American, Asian American, and ________. middle-class mature consumers RVers echo boomers

18. Groups of people with shared value systems based on common life experiences are called ________. cohorts generations subcultures affiliate groups

19. Groups of people with shared value systems based on common life experiences are called ________. cohorts generations subcultures affiliate groups

20. The fastest-growing and most affluent subculture in the United States is the _____ population. Hispanic African American Asian American mature

21. The fastest-growing and most affluent subculture in the United States is the _____ population. Hispanic African American Asian American mature

22. Characteristics Affecting Consumer Behavior Social classes are society’s 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

23. Characteristics Affecting Consumer Behavior • In some social systems, members of different classes are reared for certain roles and cant change their social positions. In other country, however, the lines between social classes are not fixed and rigid, people can move to a higher social class or drop into a lower one.

24. Characteristics Affecting Consumer Behavior • Marketers are interested in social class because within a given social class tend to exhibit similar buying behavior. Social classes show distinct product and brand preferences in areas such as clothing , home furnishings, and automobiles.

25. Characteristics Affecting Consumer Behavior

26. Relatively permanent and ordered divisions in a society whose members share similar values, interests, and behaviors is referred to as ________. subculture families social class reference groups

27. Relatively permanent and ordered divisions in a society whose members share similar values, interests, and behaviors is referred to as ________. subculture families social class reference groups

28. Which of the following is not one of the major American social classes? Upper class Working class Lower-upper class Lower-working class

29. Which of the following is not one of the major American social classes? Upper class Working class Lower-upper class Lower-working class

30. Characteristics Affecting Consumer Behavior Groups and Social Networks

31. Characteristics Affecting Consumer Behavior Word-of-mouth influence and buzz marketing • Opinion leaders are people within a reference group who exert social influence on others • Also called influentials or leading adopters • Marketers identify them to use as brand ambassadors Groups and Social Networks

32. A person within a reference group who, because of special skills, knowledge, or other characteristics, exerts social influence on others is called a(n) ________. opinion leader mature consumer marketer upper class citizen

33. A person within a reference group who, because of special skills, knowledge, or other characteristics, exerts social influence on others is called a(n) ________. opinion leader mature consumer marketer upper class citizen

34. Characteristics Affecting Consumer Behavior Online Social Networks are online communities where people socialize or exchange information and opinions Include blogs, social networking sites (facebook), virtual worlds (second life) Groups and Social Networks

35. Characteristics Affecting Consumer Behavior Family is the most important consumer-buying organization in society Marketers are interested in the roles and influence of the husband, wife and children on the purchase of different products and services The wife traditionally has been the main purchasing agent for the family. Social Factors ( family )

36. Characteristics Affecting Consumer Behavior Children may also have a strong influence on family buying decisions Studies found that kids influence family decisions about where they take vacations , what cars or cell phones they buy. As a result , marketers of cars , full service restaurants , cell phones are now placing ads on the children oriented TV networks Social Factors ( family )

37. Characteristics Affecting Consumer Behavior Social roles and status are the groups, family, clubs, and organizations that a person belongs to that can define role and social status A role consists of the activities that people expected to perform according to the persons around them Social Factors (roles and status)

38. Characteristics Affecting Consumer Behavior Each role carries a status reflecting the general esteem given to it by society. People usually choose products appropriate to their roles and status. Consider the roles a working mother plays Social Factors (roles and status)

39. Characteristics Affecting Consumer Behavior Age and life-cycle stage People change the goods and services they buy over their lifetimes. Tastes in food, clothes, furniture and recreation are age related. Buying Is also shaped by the stage of the family life cycle “ the stages through which families might pass as they mature over time” Personal Factors

40. Characteristics Affecting Consumer Behavior Traditional family life cycle stages include young singles and married couples with children. The nontraditional stages such as unmarried couples, singles marrying later in life, single parents , extended parents ( those with young adult children returning home ) and others Personal Factors

41. Characteristics Affecting Consumer Behavior RBC Royal Bank stages • Youth: younger than 18 • Getting started: 18–35 who are going through first experiences, first credit card, first car , first child • Builders: 35–50 in their peak earning years, as they build careers and family, they tend to borrow more than they invest Personal Factors

42. Characteristics Affecting Consumer Behavior • Accumulators: 50–60 Worry about saving for retirement and invested wisely. • Preservers: over 60 Want to maximize their retirement income to maintain a desired lifestyle. Personal Factors

43. Characteristics Affecting Consumer Behavior Occupation affects the goods and services bought by consumers Blue workers tend to buy more rugged work clothes, whereas executives buy more business suits. A company can specialize in making products needed by a given occupational group. Personal Factors

44. Characteristics Affecting Consumer Behavior Economic situation includes trends in: If economic indicators point to a recession, marketers can take steps to redesign , and reprice their products closely. Personal Factors

45. Characteristics Affecting Consumer Behavior Lifestyle is a person’s pattern of living as expressed in his or her psychographics Measures a consumer’s AIOs (activities, interests, opinions) to capture information about a person’s pattern of acting and interacting in the environment Personal Factors

46. Characteristics Affecting Consumer Behavior Personality and self-concept • Personality refers to the unique psychological characteristics that lead to consistent and lasting responses to the consumer’s environment • Personality is described in terms of traits . Personal Factors

47. Characteristics Affecting Consumer Behavior

48. Characteristics Affecting Consumer Behavior • A brand personality is the specific mix of the human traits that may be attributed to a particular brand. One researcher identified five brand personality traits: • Sincerity ( honest, wholesome, and cheerful) • Excitement ( imaginative and up-to date)

49. Characteristics Affecting Consumer Behavior 3. Competence ( reliable , intelligent and successful ) 4. Sophistication ( upper class and charming) 5. Ruggedness ( tough and outdoorsy)

50. A person’s _____ is his/her unique set of psychological characteristics that are relatively consistent and lasting. self-esteem self-concept lifestyle personality