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Dynamics of Consumer roles in the decision making process
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Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5
1
Designed by Eric Brengle B-books, Ltd.
CHAPTER
5
Consumer Decision Making
Prepared byDeborah Baker
Texas Christian University
Introduction to MarketingMcDaniel, Lamb, Hair
9
2Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5
Learning Outcomes
Explain why marketing managers should understand consumer behavior
Analyze the components of the consumer decision-making process
Explain the consumer’s postpurchase evaluation process
LOI
LO2
LO3
3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5
Learning Outcomes
Identify the types of consumer buying decisions and discuss the significance of consumer involvement
Identify and understand the cultural factors that affect consumer buying decisions
Identify and understand the social factors that affect consumer buying decisions
LO5
LO6
LO4
4Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5
Learning Outcomes
Identify and understand the individual factors that affect consumer buying decisions
Identify and understand the psychological factors that affect consumer buying decisions
LO8
LO7
5Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5
Explain why marketing managers should understand
consumer behavior
The Importance of UnderstandingConsumer BehaviorLOI
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LOI
ConsumerBehavior
ConsumerBehavior
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.
7Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5
REVIEW LEARNING OUTCOMEUnderstanding Consumer Behavior
LOI
Consumer behavior
Consumer behavior
consumers make purchase decisionsconsumers make
purchase decisions
consumers use anddispose of product
consumers use anddispose of product
= HOW
8Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5
Analyze the components of the
consumer decision-making process
The Consumer Decision-Making ProcessLO2
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LO2
ConsumerDecision-Making
Process
ConsumerDecision-Making
Process
A five-step process used
by consumers when
buying goods or services.
Consumer Decision-Making Process
10Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5
LO2 Consumer Decision-Making Process
Postpurchase Behavior
Postpurchase Behavior
PurchasePurchase
Evaluation of Alternatives
Evaluation of Alternatives
Information SearchInformation Search
Need RecognitionNeed Recognition
Cultural, Social, Cultural, Social, Individual and Individual and Psychological Psychological
Factors Factors affect affect
all stepsall steps
Cultural, Social, Cultural, Social, Individual and Individual and Psychological Psychological
Factors Factors affect affect
all stepsall steps
11Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5
LO2
NeedRecognition
NeedRecognition
Result of an imbalance between
actual and desired states.
Need Recognition
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Chapter 5
LO2 Need Recognition
Marketing helps consumers recognize an imbalance between
present status and preferred state.
Present Status
Present Status
Preferred State
Preferred State
InternalStimuli
External
Stimuli
13Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5
LO2
StimulusStimulus Any unit of input affecting
one or more of the
five senses:
Stimulus
sightsmelltastetouch
hearing
14Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5
LO2 Recognition of Unfulfilled Wants
When a current product isn’t performing properly
When the consumer is running out of a product
When another product seems superior to the one currently used
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LO2 Information Search
Internal Information Search
Recall information in memory
External Information search
Seek information in outside environment Nonmarketing controlled Marketing controlled
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LO2 External Information Searches
Need MoreNeed More Information Information
More Risk Less knowledge
Less product experienceHigh level of interestLack of confidence
Less Risk More knowledge
More product experienceLow level of interest
Confidence in decision
Need LessNeed Less Information Information
17Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5
LO2 Evoked Set
Evoked SetEvoked Set Group of brands, resulting
from an information search,
from which a buyer can
choose.
18Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5
LO2 Evaluation of Alternativesand Purchase
Evoked SetEvoked Set
Purchase!Purchase!
Analyze product attributesAnalyze product attributes
Rank attributes byimportance
Rank attributes byimportance
Use cutoff criteriaUse cutoff criteria
19Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5 LO2
Purchase
To buy To buy or not to buy...or not to buy...
Determines which attributes Determines which attributes are most important are most important
in influencing a in influencing a consumer’s choiceconsumer’s choice
20Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5
REVIEW LEARNING OUTCOMEConsumer Decision-Making Process
LO2C
UL
TU
RA
L SO
CIA
L
PSYCHOLOGICAL
INDIVIDUAL
Need Recognition
1 InformationSearch
2 EvaluateAlternatives
3 Purchase 4
21Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5
Explain the consumer’s postpurchase evaluation
process
Postpurchase BehaviorLO3
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LO3 Cognitive Dissonance
CognitiveDissonance
CognitiveDissonance
Inner tension that a
consumer experiences after
recognizing an
inconsistency between
behavior and values or
opinions.
23Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5 LO3
Postpurchase Behavior
Consumers can reduce dissonance by:
Seeking information that reinforces positive ideas about the purchase
Avoiding information that contradicts the purchase decision
Revoking the original decision by returning the product
Marketing can minimize through:Effective Communication
Follow-upGuaranteesWarranties
24Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5
Identify the types of consumer buying decisions and a
discuss the significance aof consumer involvement
Consumer Buying Decisions andConsumer InvolvementLO4
25Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5
LO4 Consumer Buying Decisions andConsumer Involvement
More Involvement
LessInvolvement
RoutineResponseBehavior
RoutineResponseBehavior
LimitedDecisionMaking
LimitedDecisionMaking
ExtensiveDecisionMaking
ExtensiveDecisionMaking
26Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5
LO4Five Factors Influencing Decisions
1. Level of consumer involvement1. Level of consumer involvement
2. Length of time to make decision2. Length of time to make decision
3. Cost of good or service3. Cost of good or service
4. Degree of information search4. Degree of information search
5. Number of alternatives considered5. Number of alternatives considered
27Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5
LO4 Continuum of Consumer Buying Decisions
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LO4 Routine Response Behavior
Little involvement in selection process
Frequently purchased low cost goods
May stick with one brand
Buy first/evaluate later
Quick decision
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LO4 Limited Decision Making
Low levels of involvement
Low to moderate cost goods
Evaluation of a few alternative brands
Short to moderate time to decide
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LO4 Extensive Decision Making
High levels of involvement
High cost goods
Evaluation of many brands
Long time to decide
May experience cognitive dissonance
31Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5
LO4 Factors Determining the Level of Consumer Involvement
SituationSituation
Social VisibilitySocial Visibility
InterestInterest
Perceived Risk of Negative Consequences
Perceived Risk of Negative Consequences
Previous ExperiencePrevious Experience
32Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5
LO4 Marketing Implications of Involvement
High-involvement purchases require:High-involvement purchases require:
Extensive and informative promotion to target market
Extensive and informative promotion to target market
Low-involvement purchases require:Low-involvement
purchases require:
In-store promotion, eye-catching package design, and good displays.Coupons, cents-off,2-for-1 offers
In-store promotion, eye-catching package design, and good displays.Coupons, cents-off,2-for-1 offers
33Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5
REVIEW LEARNING OUTCOME Consumer Buying Decisions and Consumer Involvement
LO4
RoutineRoutine
LimitedLimited
ExtensiveExtensive
Previous experienceInterestPerceived risk of negative consequencesSituationSocial visibility
34Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5
Identify and understand the cultural factors
that affect consumer buying decisions
Cultural Influences on Consumer Buying DecisionsLO5
35Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5
LO5 Factors Influencing Buying Decisions
Social Factors
Individual Factors
Psycho-logical Factors
Cultural Factors
CONSUMERDECISION-
MAKINGPROCESS
BUY /
DON’T BUY
36Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5
LO5 Culture
CultureCulture
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.
37Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5
LO5 Components of Culture
MythsMyths
LanguageLanguage
ValuesValues
CustomsCustoms
RitualsRituals
LawsLaws
Material artifactsMaterial artifacts
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LO5 Culture is. . .
LearnedLearned
FunctionalFunctional
PervasivePervasive
DynamicDynamic
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ValueLO5
ValueValueEnduring belief that a specific
mode of conduct is personally or
socially preferable to another
mode of conduct.
40Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5
LO5 Core American Values
SuccessSuccess
MaterialismMaterialism
FreedomFreedom
ProgressProgress
YouthYouth
CapitalismCapitalism http://www.thesource.com
Online
41Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5
SubcultureLO5
SubcultureSubcultureA homogeneous group
of people who share elements of
the overall culture as well as unique
elements of their own group.
http://www.dead.net
Online
42Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5
LO5 Social Class
Social ClassSocial 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.
43Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5
LO5 Social Class Measurements
WealthWealth
Other VariablesOther Variables
IncomeIncome
EducationEducation
OccupationOccupation
44Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5
LO5 Social Class and Education
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LO5 The Impact of Social Class on Marketing
1. Indicates which medium to use for advertising
2. Helps determine the best distribution for products
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REVIEW LEARNING OUTCOME Cultural Factors
LO5
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Identify and understand the social factors that affect consumer buying decisions
Social Influences on Consumer Buying DecisionsLO6
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LO6 Social Influences
Reference Groups
Reference Groups
Opinion LeadersOpinion Leaders
Family MembersFamily
Members
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LO6 Reference Group
Reference GroupReference Group A group in society that
influences an individual’s
purchasing behavior.
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LO6 Reference Groups
Reference Groups
Direct
Indirect
Primary
Secondary
Aspirational
Nonaspirational
51Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5
LO6 Influences of Reference Groups
1. They serve as information sources and influence perceptions.
2. They affect an individual’s aspiration levels.
3. Their norms either constrain or stimulate consumer behavior.
52Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5
LO6
Opinion LeadersOpinion Leaders
Opinion Leaders
An individual who influences
the opinion of others.
53Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5LO6
Teenagers Movie stars Sports figures Celebrities
Marketers are looking to Web logs,
or blogs, to find opinion leaders
Opinion Leaders
54Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5LO6
Initiators
Influencers
Decision Makers
Purchasers
Consumers
Purchase Process Roles in the Family
Family
55Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5
LO6Relationships among Purchasers
and Consumers in the Family
56Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5
REVIEW LEARNING OUTCOME Social Factors
LO6
Direct IndirectReferenceGroups Primary Secondary Aspirational Nonaspirational
OpinionLeaders
Peopleyou know
Socialization Process
Family
Celebrities
Initiators Decision Makers Consumers
Influencers Purchasers
57Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5
Identify and understand the individual factors
that affect consumer buying decisions
Individual Influences onConsumer Buying DecisionsLO7
58Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5
LO7 Individual Influences
GenderGender Age Life Cycle
Age Life Cycle
PersonalitySelf-Concept
Lifestyle
PersonalitySelf-Concept
Lifestyle
59Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5
Identify and understand the psychological factors
that affect consumer buying decisions
Psychological Influences onConsumer Buying DecisionsLO8
Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5 60
LO8
Psychological Influences
PerceptionPerception
MotivationMotivation
LearningLearning
Beliefs & AttitudesBeliefs & Attitudes
61Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5
LO8 Perception
PerceptionPerception Process by which people select,
organize, and interpret stimuli
into a meaningful and coherent
picture.
Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5 62
LO8
Perception
SelectiveSelectiveExposureExposureSelectiveSelectiveExposureExposure
SelectiveSelectiveDistortionDistortionSelectiveSelectiveDistortionDistortion
SelectiveSelectiveRetentionRetention SelectiveSelective
RetentionRetention
63Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5
LO8
Selective ExposureSelective Exposure
SelectiveDistortionSelectiveDistortion
Selective RetentionSelective Retention
Consumer notices certain stimuli and ignores others
Consumer notices certain stimuli and ignores others
Consumer changes or distorts information that conflicts
with feelings or beliefs
Consumer changes or distorts information that conflicts
with feelings or beliefs
Consumer remembers only that information that
supports personal beliefs
Consumer remembers only that information that
supports personal beliefs
Perception
64Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5
LO8Marketing Implications of
Perception
Important attributes
Price
Brand names
Quality and reliability
Threshold level of perception
Product or repositioning changes
Foreign consumer perception
65Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5
LO8 Motivation
Maslow’s Hierarchyof Needs
Maslow’s Hierarchyof Needs
A method of classifying human
needs and motivations into five
categories in ascending order of
importance.
66Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5
LO8 Maslow’s Hierarchy of Needs
67Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5
LO8 Types of Learning
ExperientialExperiential
ConceptualConceptual
An experience changes behavior
An experience changes behavior
Not learned through direct experience
Not learned through direct experience
http://www.cspinet.org
Online
68Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5
LO8Stimulus Generation and Discrimination
Stimulus Generalization
Stimulus Generalization
A form of learning that occurs when one response is extended to a second stimulus similar to the first.
A form of learning that occurs when one response is extended to a second stimulus similar to the first.
StimulusDiscrimination
StimulusDiscrimination
A learned ability to differentiate among similar products.
A learned ability to differentiate among similar products.
69Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5
LO8
BeliefBelief
AttitudeAttitude
An organized pattern of
knowledge that an individual
holds as true about his or her
world.
A learned tendency to
respond consistently toward a
given object.
Beliefs and Attitudes
70Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5
LO8 Changing Attitudes
Change beliefs about the brand’s attributes
Change the relative importance of these beliefs
Add new beliefs
Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5
Biz Flix
Family Man
71
LO8
72Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5
REVIEW LEARNING OUTCOMELO8
Psychological Factors
LearningStimulus
GeneralizationStimulus
Discrimination
Selective ExposurePerception
Selective Retention Selective Exposure
NeedsMotivation
Psychological EsteemSafety Social Esteem
Beliefs &Attitudes
ChangingBeliefs about
Attributes
ChangingImportance of
Beliefs
AddingNew Beliefs
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