Marketing chapter 5a understanding consumer behavior

CONSUMER PURCHASEDECISION PROCESS – Stages a buyer passes through in making choices about which products and services to buy – The five stages are: 1 Problem recognition 2 Information

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Distinguish among three variations of the consumer purchase decision

process: routine, limited, and extended problem solving.

LO2

LEARNING OBJECTIVES (LO)

AFTER READING CHAPTER 5, YOU SHOULD BE ABLE TO:

LO1 Describe the stages in the consumer

purchase decision process.

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Identify the major sociocultural influences on consumer behavior.

LO3

LO4

LEARNING OBJECTIVES (LO)

AFTER READING CHAPTER 5, YOU SHOULD BE ABLE TO:

Identify major psychological influences

on consumer behavior.

5-3

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CONSUMER PURCHASE

DECISION PROCESS

Slide 5-6

– Actions a person takes in purchasing

and using products and services –

including the mental and social

processes that come before and after

these actions

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CONSUMER PURCHASE

DECISION PROCESS

– Stages a buyer passes through in

making choices about which products

and services to buy

– The five stages are:

1) Problem recognition

2) Information search

3) Alternative evaluation

4) Purchase decision

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FIGURE 5-1 The purchase decision process

consists of five stages

5-7

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CONSUMER PURCHASE DECISION PROCESS

Slide 5-6

1 Problem Recognition: Perceiving a

Need

– Perceives a difference between a

person’s ideal and actual situations big enough to trigger a decision

– Advertisements or salespeople can

activate a consumer’s making process by showing the shortcomings of competing or currently owned products

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decision-CONSUMER PURCHASE DECISION PROCESS

2 Information Search: Seeking Value

– Internal Search – scanning one’s

memory for previous experiences with products or brands

– Often sufficient for frequently

purchased products

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Slide 5-6

– External Search – necessary when

past experience or knowledge is insufficient, risk of making a bad decision is high , and cost of gathering information is low

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– External Search – primary sources

of external information:

a) Personal sources – friends and

relatives whom consumer trusts

b) Public sources – includes various

product-rating organizations like

Consumer Reports, government

agencies, or consumer-oriented TV programs

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3 Alternative Evaluation: Assessing

Value

– The information stage clarifies the

problem for consumers by:

– Suggesting criteria, or points to

consider, for the purchase

– Providing brand names that might

meet the criteria

– Developing consumer value

perceptions

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PURCHASE DECISION PROCESS

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Value

– Consumer’s evaluative criteria

represent both the objective attributes

of a brand and the subjective ones used to compare different products and brands (often mentioned in

advertisements)

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Slide 5-6

Value, cont.

– Consumers often have several criteria

for evaluating brands and these criteria establish the consideration set – the group of brands that a consumer would consider acceptable from

among all brands in the product class

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FIGURE 5-2 Consumer Reports’ evaluation

of flash-memory MP3 players (abridged)

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Slide 5-11

FIGURE 5-A What new car buyers consider

most important in deciding what new car to

buy

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PURCHASE DECISION

LO1

 Decide from Whom to Buy

 Decide When to Buy

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Slide 5-6

4 Purchase Decision: Buying Value

– Having examined the alternatives, two

choices remain:

– From whom to buy, which is determined

by the seller’s terms of sales, past purchase experience return policy, etc.

– When to buy, which is determined by

whether the product is on sale, coupon/

rebate, store’s atmosphere, shopping experience, salesperson

persuasiveness, time pressure, financial terms, etc.

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4 Purchase Decision: Buying Value

– The internet adds technological

dimension by allowing consumers to:

• Gather information,

• Evaluate alternatives, and

• Make buying decisions

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Slide 5-6

5 Post Purchase Behavior: Value in

Consumption or Use

– After buying a product, the consumer

compares it expectations and is either satisfied or dissatisfied.

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Consumer Purchase Decision Why is post purchase behavior important?

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Slide 5-6

5 Post Purchase Behavior, cont.

• Customer’s satisfaction or dissatisfaction

with the consumption or use experience

affects their value perceptions and

repeated purchase behavior

– Satisfied buyers tell three other people

about their experience, while

dissatisfied buyers tell nine people

– Satisfied buyers tend to buy from the

same seller each time a purchase decision arises, creating a huge financial impact

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5 Post Purchase Behavior, cont.

– If dissatisfied, marketers must decide

whether:

• The product was deficient, leading

to a design change

• Consumer expectations were too

high if company’s advertising or salesperson oversold product’s features.

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POSTPURCHASE BEHAVIOR

LO1

Cognitive Dissonance

5-28

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● Cognitive Dissonance (Buyer’s Remorse)

● Situation when a consumer experiences some

post purchase psychological tension or anxieties

● Results from an imbalance among purchaser’s knowledge, beliefs, and attitudes

● “Should I have purchased this?”

● Likely to increase in one of three cases:

● The dollar vale of the purchase increases

● Rejected alternatives have desirable features that chosen alternative does not

● When purchase decision has major effect on

buyer

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● After a purchase, consumers seek to affirm their choice – often seeking information or approval from others or reading ads or

reviews about the brand chosen

● Marketers can help buyers reduce cognitive dissonance by providing information that

supports the chosen alternative, e.g.,

follow-up calls

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5 Post Purchase Behavior: Value in

Consumption or Use

– Many firms focus attention on post

purchase behavior to maximize customer satisfaction and retention by offering toll-free numbers, liberalized return policies, and providing staff training in handling customer

complaints

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Slide 5-15

Involvement and Problem-Solving

CONSUMER INVOLVEMENT & PROBLEM SOLVING

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• Involvement and Problem-Solving

Variations

• Consumers may skip or minimize one or

more steps in the decision process

depending on the level of involvement – the

personal, social, and economic significance

of the purchase to the consumer

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Slide 5-15

Variations

• For High-Involvement Purchases:

– Item typically has at least one of three

characteristics: 1) is expensive; 2) can

have serious personal consequences;

or, 3) could reflect on one’s image

– Consumers engage in extensive

information search, consider many

product attributes and brands, and use

word of mouth

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Variations

• For Low-Involvement Purchases:

– The product has little impact

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Slide 5-15

Variations

– Three general problem-solving

variations in the consumer purchase

decision process:

1 Routine Problem Solving

2 Limited Problem Solving

3 Extended Problem Solving

CONSUMER INVOLVEMENT & PROBLEM SOLVING

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Variations

1 Routine Problem Solving

– The purchase process is habitual and

involves little effort seeking external

information and evaluating alternatives

– Typically used for low-priced, frequently

purchased products

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Slide 5-15

Variations

• Limited Problem Solving

– Consumers seek some information to

evaluate alternative brands and attributes

– Used when buyer has little time or effort

to spend

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Variations

• Extended Problem Solving

– Each stage of the consumer buying

process is used, including considerable

time and effort on external information

search to identify and evaluate the

attributes of several brands in the

consideration set

– High-involvement purchases

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FIGURE 5-3 Comparison of problem-solving

variations: extended, limited, and routine

5-40

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• Involvement and Marketing Strategy

• For low-involvement products whose brands

are market-share leaders, marketers should

– Maintain product quality

– Avoid stockouts so buyers would not

substitute a competing brand

– Develop ads that reinforce consumers’

knowledge or assure buyers that they made the right choice

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Slide 5-15

• For low-involvement products whose brands

are market challengers, marketers should:

– Use free samples, coupons, and rebates to

encourage trial of their product to break a

buying habit

– Develop ads that get their brand into a

consumer’s consideration set

– Link brand attributes with high involvement issues

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• For high-involvement products whose brands

are market-share leaders, marketers should:

– Use advertising

– Use personal selling

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Slide 5-15

• For high-involvement products whose brands

are market challengers, marketers should:

– Use comparative ads and novel evaluative

criteria for judging competing brands

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FIGURE 5-4 Influences on the consumer

purchase decision process from both

internal and external sources

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PSYCHOLOGICAL INFLUENCES

ON CONSUMER BEHAVIOR

Slide 5-22

• Motivation

– Energizing force that stimulates

behavior to satisfy a need

– Marketers try to arouse these needs

which are hierarchical

– Range from basic to learned needs

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FIGURE 5-5 Hierarchy of needs

5-48

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• Perception – process by which

individuals select, organize, and

interpret information to create a

meaningful picture of the world

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comprehension , and retention by the

human brain to organize and

interpret information

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• Selective Exposure occurs

– When people pay attention to messages

that are consistent with their own

attitudes and beliefs and ignore

messages that are inconsistent

– At the post purchase stage when

consumers read ads for the brand they

just bought

– When a need exists, such as being

hungry

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Slide 5-24

involves interpreting information so

that it is consistent with a person’s

attitudes and beliefs

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• Selective Retention – means that

consumers do not remember all the

information they see, read, or hear,

even minutes after exposure to it

– This affects the internal and external

information search stages of the

consumer decision process

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Slide 5-24

• Subliminal Perception – means

that people see or hear messages

without being aware of them

– Hotly debated issue with more popular

appeal than scientific support

– Research suggests that such messages

have limited effects on behavior

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• Subliminal advertising is aimed at the subconscious

level of awareness.

• Almost 50 years ago, a New Jersey movie theater tried

to boost concession sales by flashing the words Eat

Popcorn and Drink Coca-Cola.

• Research has shown that subliminal messages cannot

force receivers to purchase goods that they would not

consciously want.

• Subliminal advertising has been universally condemned

as manipulative, most experts believe that it is

exceedingly unlikely to induce purchasing except by

people already inclined to buy

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ETHICS AND SOCIAL RESPONSIBILITY ALERT

Slide 5-25

The Ethics of Subliminal Messages

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• Perceived Risk – represents the

anxieties felt because the consumer

cannot anticipate the outcomes of a

purchase but believes that their may

be a negative consequence

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Slide 5-24

Perceived Risk include:

– Size of financial outlay for product

– Risk of physical harm

– Performance of the product

– Psychosocial – what will other people

think or say

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• Perceived Risk affects the

information stage of the consumer

purchase decision process

– The greater the perceived risk, the more

extensive the external search is likely to

be

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Slide 5-26

• Marketers try to reduce consumer’s

perceived risk and encourage

purchases by using one or more

strategies:

• Obtain Seals of Approval

• Secure Endorsements from Influential People

• Provide Free Trials

• Give Extensive Usage Instructions

• Provide Warranties and Guarantees

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Learning

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Slide 5-24

• Learning – refers to those

behaviors that result from

1) Repeated experience

2) Reasoning

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• Learning – refers to those

behaviors that result from

• Behavioral

• Cognitive

• Brand Loyalty

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Slide 5-24

• Behavioral Learning – process of

developing automatic responses to a

type of situation built up through

repeated exposure to it

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• Four variables are key to how to

how consumers learn from repeated

experience:

1 Drive: need that moves an individual to action

2 Cue: stimulus or symbol that one perceives

3 Response: action taken to satisfy a drive

4 Reinforcement: the reward

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Slide 5-24

behavioral learning theory:

1) Stimulus generalization – when a response

elicited by one stimulus (cue) is generalized

to another

– e.g., using the same brand name for

different products 2) Stimulus discrimination – refers to one’s

ability to perceive differences among similar products

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• Cognitive Learning – involves

making connections between two or

more ideas or simply observing the

outcomes of others’ behaviors and

adjusting one’s own behavior

accordingly through thinking,

reasoning, and problem solving

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Slide 5-24

• Brand Loyalty – a favorable attitude

toward, and a consistent purchase of a

single brand over time

• Results from positive reinforcement of

previous actions

• Reduces risk and saves time due to

favorable results

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FIGURE 5-B Brand loyalty tendency by

product category

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