CB- 1st Lecture

8/6/2019 CB- 1st Lecture

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Consumer Buying Behavior

• Consumer Buying Behavior Consumer Buying Behavior refers to the buyingbehavior of final consumers -individuals &households who buy goods and services for personal consumption.

• The term CB is defined as the behaviour thatconsumers display in searching for, purchasing,

using, evaluating, and disposing of products andservices that they expect will satisfy their needs.

Consumer Buying Behavior

Need for understanding Consumer

Behaviour • Shorter Product life cycles• Evolving consumer preferences• Environmental concerns• Faster technology adoption

Model of Consumer Behavior

Marketing andOther Stimuli

Buyer’s Black BoxBuyer’s Black Box

Buyer’s Response

Product

Promotion

Economic

Technological

Political

Cultural

CharacteristicsAffectingConsumer Behavior

Buyer’sDecisionProcess

Product Choice

Brand Choice

Dealer Choice

PurchaseTiming

PurchaseAmount

Factors Influencing

Consumer Behavior

Social

Referencegroups

Family

Rolesand

status

PersonalAge andlife-cycle

OccupationEconomicsituation

LifestylePersonality

andself-concept

Psycho-logical

MotivationPerception

Learning

Beliefs andattitudes

Culture

Sub-culture

Socialclass

Culture

Sub-culture

Socialclass

Cultural

Factors Affecting Consumer

Behavior: Culture

• Group of people withshared value systemsbased on common lifeexperiences

• Festivals and customs indifferent parts of thecountry

Culture is the Most Basic Cause of aPerson's Wants and Behavior.

Factors Affecting Consumer Behavior: Culture

Culture is the Set of Values, Perceptions,Wants & Behavior Learned by a Member of

Society from Family.• Society’s relatively

permanent & ordereddivisions whose membersshare similar values,interests, and behaviors.

• Measured by: Occupation,

Income, Education, Wealthand Other Variables.

Groups• Membership• Reference

Family (mostimportant)• Husband, wife, kids

• Influencer, buyer,user

Family (mostimportant)• Husband, wife, kids

• Influencer, buyer,user

Roles and StatusRoles and Status

Social FactorsSocial Factors

Factors Affecting Consumer

Behavior: Social

Personal InfluencesPersonal Influences

Age and LifeCycle StageAge and LifeCycle Stage OccupationOccupation Personality &Self-Concept

Personality &Self-ConceptEconomicSituation

EconomicSituation

ActivitiesActivities InterestsInterests

Lifestyle IdentificationLifestyle Identification

OpinionsOpinions

Factors Affecting Consumer Behavior: Personal

Factors Affecting Consumer Behavior: Psychological

PsychologicalFactors

AffectingBuyersChoices

Motivation

Perception

Learning

Beliefs andAttitudes

Psychological - Motive

•A motive is a need that has a sufficient level

of intensity. Creating a tension state thatdrives the person to act.•Satisfying the need reduces the felt tension.

• Buying motives thus are defined as ‘thoseinfluences or considerations which providethe impulse to buy, induce action or determine choice in the purchase of goodsor service

Consumer Motives

• Product Motives• Emotional Product Motives

• Rational Product Motives• Patronage Motives

• Emotional Patronage Motives

• Rational Patronage Motives

Nature of Motive Purchase Decision• Desire for money : Purchasing when price falls down• Fear : Purchasing Insurance policy•

Pride : Purchasing premium products• Fashion : Rural people imitate urban• Possession : purchasing antiques• Health : Purchasing health foods .membership in health

clubs• Comfort : Purchasing micro-oven, washing machine,mixer

• Love and affection : Purchasing gift items

The process by which an individual selects,organizes, and interprets information inputs tocreate a meaningful picture of the world.

Psychological - Perception

PSYCHOLOGICAL INFLUENCESON CONSUMER BEHAVIOR

• Perception

Selective

Exposure

Selective

Exposure

SelectiveComprehension

SelectiveRetentionSelectiveRetention

Consumer pays attention to certain

stimuli and ignores others

Consumer pays attention to certain

stimuli and ignores others

Consumer interprets info so that it isconsistent with his beliefs

Average consumer only remembers30% of information heard

Psychological - Learning

Changes in an individual’s behavior arising from experience.

Psychological - Attitude

An attitude describes a person’s relatively

consistent evaluations, feelings, andtendencies toward an object or idea.

PSYCHOLOGICAL INFLUENCESON CONSUMER BEHAVIOR

Motivation – what stimulates behavior to satisfy a need

Maslow’s Hierarchyof Needs

• How do you know when to shop? What are the

triggers that initiate an awareness & search?

• What are the internal & external sources of thesetriggers?

Buyer Decision Process

Post purchaseBehavior

Purchase

Decisio

Information

SearchNeed

Recognitio

Evaluationof

Alternatives

Need Recognition

Preferred State

Marketing helpsconsumers recognize

(or create) an imbalance

between present statusand preferred state

• When a current product isn’tperforming properly

• When the consumer is runningout of an product

• When another product seemssuperior to the one currently used

The information search stage

An internal search involves thescanning of one's memory to recall previousexperiences or knowledge concerningsolutions to the problem-- often sufficient for frequently purchased products.

An external search may be necessarywhen past experience or knowledge isinsufficient, the risk of making a wrongpurchase decision is high, and/or the cost of

gathering information is low.

Personal sources(friends and family)

Public sources (ratingservices like Consumer

Reports)

Marketer-dominated

sources (advertisingor sales people)

The evoked set: a group of brands from which the buyer can

choose

Determinants of External Search

The Buyer Decision ProcessEvaluation of Alternatives

Product AttributesEvaluation of Quality, Price, & Features

Degree of ImportanceWhich attributes matter most to me?

Brand BeliefsWhat do I believe about each available brand?

Total Product SatisfactionBased on what I’m looking for, how satisfiedwould I be with each product?

Total Product SatisfactionBased on what I’m looking for, how satisfied

would I be with each product?

Evaluation ProceduresChoosing a product (and brand) based on one

or more attributes.

Evaluation ProceduresChoosing a product (and brand) based on one

or more attributes.

Buyer Behavior

• Initiator : the person who first suggests or thinks of the idea of buying aparticular product or service.

• Influencer : a person whose views or advice carry weight in making thefinal buying decision

• Decider : the person who ultimately makes the final buying decision or anypart of it

• Buyer : the person who makes the actual purchase

• User : the person who consumes the product or service

Other people often influence a consumers purchase decision.The marketer needs to know which people are involved in thebuying decision and what role each person plays, so thatmarketing strategies can also be aimed at these people.(Kotler et al, 1994).

Note: teens are increasingly assuming more of these roles

Think about your past purchase– who was in which role?

WifeDominant

HusbandDominant

100 50 075 25

Women’sclothing

Pots & pans

Child clothing

groceries

vacations

TV sets

Family car Sport equipment

Lawn mower

Paint wallpaper

Men’s leisure clothing

Men’s business clothing

cameraFinancial planning

furniture

refrigerator

luggage

carpet

Toys/games

stereo

hardware

Extent of role specialization

Relative influence of husbands & wives

Informationsearch

Finaldecision

The Buyer DecisionProcess

Purchase Decision

The Buyer DecisionProcess

Purchase DecisionPurchase IntentionDesire to buy the most preferred brand

Purchase IntentionDesire to buy the most preferred brand

Purchase DecisionPurchase Decision

Attitudesof others

Unexpectedsituationalfactors

Th B D i i P

The Buyer Decision ProcessPost purchase Behavior

Consumer’s Expectations of Product’s Performance

DissatisfiedCustomer

SatisfiedCustomer!Satisfied

Customer!

Product’s Perceived

Performance

Product’s Perceived

Performance

Cognitive Dissonance

Postpurchase Behavior

Can minimize through:Effective Communication

Follow-upGuaranteesWarranties

Underpromise &overdeliver

Cognitive DissonanceCognitive Dissonance

??Did I make a good decision?Did I make a good decision?

Did I buy the right product?Did I buy the right product?

Did I get a good value?Did I get a good value?

Cognitive Dissonance

• psychological discomfort caused by inconsistenciesamong a person’s beliefs, attitudes, and actions

• varies in intensity based on importance of issue anddegree of inconsistency

• induces a “drive state” to avoid or reduce dissonance

by changing beliefs, attitudes, or behaviors andthereby restore consistency

Tendency to avoid information can be countered by eliciting interest,norm of fairness, or perceive usefulness of information

Post-decision “buyer’s remorse” may be increased by importance or difficultyor irreversibility of decision

Counter-attitudinal action, freely chosen with little incentive or justification, leads to attitude change (e.g., new product at special lowprice)

Applications:

TYPES OF CONSUMER BUYING

BEHAVIOR :There are four types of consumer buying

behavior, they are :

• Routine Response/Programmed Behavior • Limited Decision Making• Extensive Decision Making• Impulse buying

1. ROUTINERESPONSE/PROGRAMMED

BEHAVIOR

Buying low involvement, frequently purchased, low cost items.

Examples :

Soft drinks, snack foods, milk etc.

3.EXTENSIVE DECISION

MAKING :Complex high involvement,

unfamiliar, expensive and infrequently bought products.

Spend a lot of time seekinginformation and deciding. High degree of risk.

Example:Cars, homes, computers, education.

4. IMPULSE BUYING :

No conscious planning.The purchase of the same product does not

always elicit the same Buying Behavior. Productcan shift from one category to the next.For example:Going out for dinner for one person may beextensive decision making (for someone that doesnot go out often at all), but limited decisionmaking for someone else. The reason for thedinner, whether it is an anniversary celebration, or a meal with a couple of friends will also determinethe extent of the decision making.

Thank You!!!

CB- 1st Lecture

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