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Consumer Decision Making

Consumer Decision Making. 5. chapter. Prepared by Deborah Baker Texas Christian University. Learning Objectives. 1. Explain why marketing managers should understand consumer behavior. 2. Analyze the components of the consumer decision-making process.

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Consumer Decision Making

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  1. Consumer Decision Making 5 chapter Prepared by Deborah Baker Texas Christian University Chapter 5 Version 6e

  2. Learning Objectives 1. Explain why marketing managers should understand consumer behavior. 2. Analyze the components of the consumer decision-making process. 3. Explain the consumer’s postpurchase evaluation process. 5 chapter Chapter 5 Version 6e

  3. Learning Objectives (continued) 4. Identify the types of consumer buying decisions and discuss the significance of consumer involvement. 5. Identify and understand the cultural factors that affect consumer buying decisions. 5 chapter Chapter 5 Version 6e

  4. Learning Objectives (continued) 6. Identify and understand the social factors that affect consumer buying decisions. 7. Identify and understand the individual factors that affect consumer buying decisions. 8. Identify and understand the psychological factors that affect consumer buying decisions. 5 chapter Chapter 5 Version 6e

  5. 1 Learning Objective Explain why marketing managers should understand consumer behavior. Chapter 5 Version 6e

  6. 1 Consumer Behavior Processes a consumer uses to make purchase decisions, as well as to use and dispose of purchased goods or services; also includes factors that influence purchase decisions and the product use. Chapter 5 Version 6e

  7. 2 Learning Objective Analyze the components of the consumer decision-making process. Chapter 5 Version 6e

  8. 2 Consumer Decision-Making Process A five-step process used by consumers when buying goods or services. Chapter 5 Version 6e

  9. Need Recognition Information Search Cultural, Social, Individual and Psychological Factors affect all steps Evaluation of Alternatives Purchase Postpurchase Behavior 2 Consumer Decision-Making Process Chapter 5 Version 6e

  10. 2 Need Recognition Result of an imbalance between actual and desired states. Chapter 5 Version 6e

  11. Marketing helps consumers recognize an imbalance between present status and preferred state Internal Stimuli and External Stimuli Preferred State Present Status 2 Need Recognition Chapter 5 Version 6e

  12. 2 Stimulus Any unit of input affecting one or more of the five senses: • sight • smell • taste • touch • hearing Chapter 5 Version 6e

  13. 2 Want Recognition of an unfulfilled need and a product (or attribute or feature) that will satisfy it. Chapter 5 Version 6e

  14. 2 Recognition of Unfulfilled Wants • When a current product isn’t performing properly • When the consumer is running out of an product • When another product seems superior to the one currently used Chapter 5 Version 6e

  15. 2 Information Searches Process of recalling past information stored in the memory. Internal Process of seeking information in the outside environment. External Chapter 5 Version 6e

  16. Internal Information Search • Recall information in memory 2 Information Search External Information search • Seek information in outside environment • Non-marketing controlled • Marketing controlled Chapter 5 Version 6e

  17. Need Less Information Need More Information Less Risk More knowledge More product experience Low level of interest More Risk Less knowledge Less product experience High level of interest 2 External Information Searches Chapter 5 Version 6e

  18. 2 Evoked Set Group of brands, resulting from an information search, from which a buyer can choose. Chapter 5 Version 6e

  19. Evoked Set Evaluation of ProductsAnalyze product attributesUse cutoff criteriaRank attributes by importance Purchase! 2 Evaluation of Alternatives Chapter 5 Version 6e

  20. 2 Purchase To buy or not to buy... Marketing Determines which attributes are most important in influencing a consumer’s choice Chapter 5 Version 6e

  21. 3 Learning Objective Explain the consumer’s postpurchase evaluation process. Chapter 5 Version 6e

  22. 3 Cognitive Dissonance Inner tension that a consumer experiences after recognizing an inconsistency between behavior and values or opinions. Chapter 5 Version 6e

  23. Cognitive Dissonance ? Marketing Did I make a good decision? Did I buy the right product? Did I get a good value? Can minimize through: Effective Communication Follow-up GuaranteesWarranties 3 Postpurchase Behavior Chapter 5 Version 6e

  24. 4 Learning Objective Identify the types of consumer buying decisions and discuss the significance of consumer involvement. Chapter 5 Version 6e

  25. 4 Types of Consumer Buying Decisions Routine Response Behavior Limited Decision Making Extensive Decision Making Less Involvement More Involvement Chapter 5 Version 6e

  26. 4 Five Factors influencing Decisions 1. Level of consumer involvement 2. Length of time to make decision 3. Cost of good or service 4. Degree of information search 5. Number of alternatives considered Chapter 5 Version 6e

  27. 4 Routine Response Behavior • Little involvement in selection process • Frequently purchased low cost goods • May stick with one brand • Buy first/evaluate later • Quick decision Chapter 5 Version 6e

  28. 4 Limited Decision Making • Low levels of involvement • Low to moderate cost goods • Evaluation of a few alternative brands • Short to moderate time to decide Chapter 5 Version 6e

  29. 4 Extensive Decision Making • High levels of involvement • High cost goods • Evaluation of many brands • Long time to decide • May experience cognitive dissonance Chapter 5 Version 6e

  30. Previous Experience Interest Perceived Risk of Negative Consequences Factors Determining Level of Involvement Situation Social Visibility 4 Level of Involvement Chapter 5 Version 6e

  31. High-involvement purchases require: extensive promotion to target market and good advertisement Low-involvement purchases require: in-store promotion and eye-catching package design 4 Marketing Implications of Involvement Chapter 5 Version 6e

  32. Cultural Factors Social Factors CONSUMERDECISION- MAKING PROCESS BUY / DON’T BUY Psycho-logical Factors Individual Factors 4 Factors Influencing Buying Decisions Chapter 5 Version 6e

  33. 5 Learning Objective Identify and understand the cultural factors that affect consumer buying decisions. Chapter 5 Version 6e

  34. 5 Culture Set of values norms, attitudes, and other meaningful symbols that shape human behavior and the artifacts, or products, of that behavior as they are transmitted from one generation to the next. Chapter 5 Version 6e

  35. Values Components ofAmerican Culture Language Myths Customs Rituals Laws Material Artifacts 5 Cultural Influences on Buying Decisions Chapter 5 Version 6e

  36. 5 Culture is... Pervasive Functional Learned Dynamic Chapter 5 Version 6e

  37. 5 Value Enduring belief that a specific mode of conduct is personally or socially preferable to another mode of conduct. Chapter 5 Version 6e

  38. Core American Values Success Materialism Freedom Progress Youth Capitalism 5 Core American Values Chapter 5 Version 6e

  39. 5 Global Language Blunders • Chevrolet’s “Nova” translated to “No Go” • Coors “Turn it Loose” became “Suffer from Diarrhea” • Toyota’s MR2 sounded like a swearword in French • Coca-Cola in Chinese means “bite the wax tadpole” Chapter 5 Version 6e

  40. 5 Subculture A homogeneous group of people who share elements of the overall culture as well as unique elements of their own group. Chapter 5 Version 6e

  41. 5 Social Class A group of people in a society who are considered nearly equal in status or community esteem, who regularly socialize among themselves both formally and informally, and who share behavioral norms. Chapter 5 Version 6e

  42. 6 Learning Objective Identify and understand the social factors that affect consumer buying decisions. Chapter 5 Version 6e

  43. 6 Social Influences Social Influences on Buying Decisions Reference Groups Family Members Opinion Leaders Chapter 5 Version 6e

  44. 6 Reference Group A group in society that influences an individual’s purchasing behavior. Chapter 5 Version 6e

  45. Primary Secondary Types ofReference Groups Aspirational Non-aspirational 6 Reference Groups Direct Indirect Chapter 5 Version 6e

  46. 6 Implications of Reference Groups • They serve as information sources and influence perceptions • They affect an individual’s aspiration levels • Their norms either constrain or stimulate consumer behavior Chapter 5 Version 6e

  47. 6 Opinion Leaders An individual who influences the opinion of others. Chapter 5 Version 6e

  48. 6 Family • Instigators • Influencers • Decision-Makers • Purchasers • Consumers Purchase Roles in the Family Children Influence Purchase Decisions Chapter 5 Version 6e

  49. 7 Learning Objective Identify and understand the individual factors that affect consumer buying decisions. Chapter 5 Version 6e

  50. 7 Individual Influences Individual Influences Gender Personality Self-Concept Lifestyle Age Family Life Cycle Chapter 5 Version 6e

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