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Rajeev Chawla 1

Consumer Behavior

Rajeev Chawla 2

Consumer Behavior

Why Consumer Behavior?

• How do we make Consumers buy our products with the reality that we live in a hypercompetitive economy

• Is there any understanding of consumers that can bear influence on their behavior

• Are there patterns of Consumer Behavior and can we study them?

• Do Men, women, children and senior citizens display any specific behavior which we can study and utilize?

• Do Consumers have buying patterns in their behavior?• Do Consumers have a set way of imbibing or learning their

habits and can we imbibe these in them?

Rajeev Chawla 3

Consumer Behavior

The Changes due to the Digital Revolution?

• Consumers have more power than before

• Consumers have access to information as never before

• Marketers can offer more services and products than ever before

• Marketers and consumers have increasing interactivity and an immediate address

• Marketers can gather more information about consumers today

• The impact is beyond your Personal Computer to the WWW

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Consumer Behavior - Definition

Consumer Behavior :

Consumer Behavior is defined as the behavior that consumers display in searching for, selecting, purchasing, using, evaluating and disposing of products and services that they expect will satisfy their needs

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Consumer Behavior

Consumer Behavior :

Seeped in The Marketing concept

• The Marketing Orientation

• Consumer Research: Secondary & Primary Data

• Consumer Research: Syndicated Services, others

• Segmentation, Targeting & Positioning

• The Marketing Mix

• Consumer Value & Satisfaction

• Customer Retention

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Consumer Behavior

Consumer Behavior :

Consumer Research:

Secondary Data:• Census Data• Syndicated Services• Database Marketing

Primary Data:• Qualitative research

Focus group interviews Projective techniques

• Survey Research• Experimental Research• Observational Research

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DECISION MAKING

What is a decision?

Why do we need to study DM Models?

What is Hobson's Choice?

DM: Required when Consumers are provided with a choice when there was originally none

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DECISION MAKING - cont

3 Levels of Consumer Decision Making:

Extensive Problem Solving

Limited Problem Solving

Routinised Response Behavior

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DECISION MAKING - cont

4 Views of Consumer Decision Making:

• An Economic View• A Passive View• A Cognitive View• An Emotional View

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THE CONSUMER DECISION MAKING MODEL

INPUT: External Influences

Firms Marketing Effort1. Product2. Promotion3. Price4. Channels of Dist

Sociocultural Environment1. Family2. Informal Sources3. Other noncommercial

sources4. Social class5. Subculture & culture

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THE CONSUMER DECISION MAKING MODEL

PROCESS : Consumer Decision Making

Need Recognition

Prepurchase Search

Evaluation OfAlternatives

Psychological FieldMotivation1. Perception2. Learning3. Personality4. Attitudes

Experience

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THE CONSUMER DECISION MAKING MODEL

OUTPUT : Post decision Behavior

Purchase

1. Trial2. Repeat Purchase

Post purchase Evaluation

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THE CONSUMER DECISION MAKING MODEL

Firms Marketing Effort1. Product2. Promotion3. Price4. Channels of Dist

Sociocultural Environment1. Family2. Informal Sources3. Other noncommercial

sources4. Social class5. Subculture & culture

Need Recognition

Prepurchase Search

Evaluation OfAlternatives

Psychological FieldMotivation1. Perception2. Learning3. Personality4. Attitudes

Experience

Purchase

1. Trial2. Repeat Purchase

Post purchase Evaluation

INPUT: External Influences

PROCESS :Consumer Decision MakingOUTPUT : Post decision Behavior

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POST PURCHASE BEHAVIOR

INDIVIDUAL:

Cognitive Dissonance

Tries to Reduce Dissonance

BRAND OWNER:

Tries to reduce Dissonance too

After Sales Service

Referencing

Communication

Sops for Repeat Purchase

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DECISION MAKING EXERCISE

What Stimuli would you build to help Customer in their Decision Making Model to decide in favor of your business if it were:

1. A Chinese Restaurant2. A Fast Food restaurant3. An International Airport4. An Educational Institute5. A Global Corporate Organization’s office6. A Shopping Mall7. A Car Dealership Showroom8. A Multiplex9. A Discotheque10. A Book store

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LEARNING

TYPES OF LEARNING THEORIES:• Behavioral OR The Stimulus-Response theories• Cognitive OR Mental Process theories

ELEMENTS OF LEARNING THEORY:• Motivation• Cues• Response and• Reinforcement

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LEARNING

Motivation:

The basis is NEEDS and GOALS

The action impetus

Cues:

These are the Stimuli

They are built into communication as wall as the Marketing Mix

Response:

Reinforcement

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LEARNING APPLICATIONS

Applications of Classical Conditioning:

• Repetition• Stimulus Generation

– Product Line, Form and Category Extensions

– Family Branding

– Licensing

• Generalizing Usage Situations• Stimulus Discrimination• Positioning• Product Differentiation

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LEARNING APPLICATIONS

Applications of Operant Conditioning:

• Reinforcement of Behavior OR Customer Satisfaction

• Forgetting and Extinction• Reinforcement Schedules• Shaping• Massed V/s Distributed Learning

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LEARNING APPLICATIONS

Cognitive Learning:

How do Consumers store Information:

Structure of Memory

Sensory store

Short term Store

Long term store

Rehearsal and encoding

Retention

Retrieval

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LEARNING MEASURABILITY

• Response to Advertising• Brand Loyalty and measure• Brand Equity

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LEARNING EXERCISE

What Stimuli would you build in line with Classical & Operant Conditioning for:

1. A Discotheque2. A Fast Food restaurant3. An International Airport4. An Educational Institute5. A Music Store6. A Shopping Mall7. A Book store8. A Multiplex9. A Chinese Restaurant10. A Car Dealership Showroom

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Motivation

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MOTIVATION

What is Motivation?

• The driving force within individuals that impels them to action

An unfulfilled need and tension produce this driving force…………..

Individuals strive to reduce this tension…………

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NEEDS

MASLOW & the HEIRARCHY Of Needs

Self Actualization

Self Esteem

Social Needs

Safety + Security

Physiological

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Maslow’s Hierarchy of Needs

Physiological needs(Food, water, shelter)

(security, protection)

(sense of belonging, love)

(self esteem, recognition, status)

(self development and realization)

Safety needs

Social needs

Esteem needs

Self- actualization

needs

1

2

3

4

5

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Needs & Goals

NEEDS:

All individuals have needs

Innate Needs – Physiological Needs (Primary Needs)

Needed for sustenance

Acquired Needs – Secondary Needs

They result from the individuals subjective psychological State and from relationships with others

GOALS: What is a goal?

Desired outcomes for individuals, groups or an entire organization

Sought after results of motivated behavior

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Needs & Goals - cont

GOALS

Generic goals

Product specific goalsGOALS are selected by individuals depending on their personal experiences, physical capacity, prevailing cultural norms and values and the goal’s accessibility in the physical and social environmentGOALS must be socially acceptable and physically accessible

NEEDS and GOALS are interdependent. They cannot exist in isolation of the other

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Needs & Goals - cont

MOTIVATION can be positive or negative in directionPOSITIVE ActionNEGATIVE Action

GOALS too can be positive or negativeA positive one is towards which behavior is directed

and A negative one is where behavior is directed away from

CALLED APPROACH & AVOIDANCE GOALS

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Needs & Goals - cont

NEEDS are never completely satisfied

New needs emerge when old needs are satisfied

Success and Failure Influence Goals

Frustration:

DEFENSE MECHANISMS:

Aggression Identification

Rationalization Repression

Regression Projection

Withdrawal

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Product Versus Need Orientation – Needs & Goals

PRODUCT ORIENTED NEED ORIENTED

Daimler Benz We make luxury cars We make automobiles which give our customers the sense of achievement they richly deserve

Tabi We make hockey sticks We make hockey players perform better and more effectively

Hilton Group We rent rooms and run 5 star hotels

We genuinely care for the comfort of our guests, ensure the finest personal service and facilities, a warm ambience and an experience that fulfills even the unexpressed needs of our guests

IIM We teach management studies We create outstanding professionals with incisive minds through our curriculum and methodology making them the best of class professionals in their careers

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THE MOTIVATION MODEL

Unfulfilled Needs,Wants And Desires

Tension/Anxiety

Drive Behavior

CognitiveProcesses

Learning

Goal or NeedFulfillment

Tension Reduction

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Needs – Goals Relationship

Means-end Analysis is a way to view the needs-goals paradigm

Set goals – based on personal values

Select means (behaviors) that are believed to help achieve their desired end

Value Means Product

Good Health Stay trim Running shoes/Bicycles/Treadmill

Low sugar/cal Sugar-free /diet colas/diet beers too

Low cholesterol White meats/Fish

Hygienic clothes Washing Machine

To promote a specific product by associating it with a generic goal

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MOTIVES

AROUSAL OF MOTIVES

• Physiological Arousal• Emotional Arousal• Cognitive Arousal• Environmental Arousal

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Market Segmentation

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Degrees of Break-down

• Mass Marketing• Segmentation• Niche Marketing• Micro-niche marketing• Individual marketing (Customization)• Mass Customization

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Degrees of Market Break-down

• Mass MarketingThe seller engages in mass production, mass distribution, and mass promotion of one product for all buyersE.g.: Ford, Coca-Cola

• SegmentationA market segment consists of a group of customers who share a similar need or needs. This could be low-cost, or a luxury experienceMarketers advise to offer segmented customers a flexible offering consisting of a naked solution containing the product and the service elements that all segments members value, and discretionary options that some segment members valueE.g.: car manufacturers offer several variants to the same model

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Degrees of Market Break-down

• Niche MarketingA Niche is a more narrowly defined customer group seeking a distinctive mix of benefits. Marketers usually identify niches by dividing a segment into sub-segmentsAn attractive niche is characterized as follows: The customers in the niche have a distinct set of needs: they will pay a premium to the firm that best satisfies their needs; the niche is not likely to attract other competitors; the nicher gains certain economies through specialization and the niche has size, profit, and growth potentialWhereas segments are fairly large and normally attract several competitors, niches are fairly small and attract only one or two competitors

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Degrees of Market Break-down

• Micro-niche marketingA Micro-niche is a very small segment of the market which has very few customers. A niche within a niche could also be called a micro-niche. Micro niches obviously have high profitability as customers are willing to pay more to have their needs met

• Individual marketing (Customization)Customization is the concept of a “segment of One”. This is a low-volume high-profit segment and the product is made specifically to cater to the needs of a single customerE.g.: Harley-Davidson bikes, Diet Programs

• Mass CustomizationIncreasing number of customers are demanding Customized offerings for the price of a Mass productE.g.: Dell computers, Automobiles abroad, Paint Companies

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Segmenting Consumer Markets

SEGMENTATATION /SEGMENTATATION VARIABLES

BASES

GEOGRAPHIC

Region North, Central India, North Eastern States

City Size Metros, Mini metros, Towns Class A, B & C

Density of Area Urban, Semi-urban, rural

Climate Temperature, Hot, Rainy, Humid

DEMOGRAPHIC

Age Under 12, 12 – 18, 18 – 25, 25 – 35, 35 – 49, etc

Gender Male, female

Marital Status Single, Married, Divorced, Live-ins, Widowed

Income Under Rs. 18,000, Rs. 18,000 – 50,000, Rs. 50,000 – 1,00,000, etc

Education High School, Higher Secondary, Graduate,Post graduate

Occupation Professional, Blue Collar, White Collar, Government, PSU, Civil

Services, Armed Forces, etc

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Segmenting Consumer Markets

SEGMENTATATION /SEGMENTATATION VARIABLES

BASES

PSYCHOLOGICALNeeds motivation Shelter, Safety, Security, Affection, Sense of Self WorthPersonality Extrovert, aggressives, novelty seekersPerception Low risk, Moderate risk, high riskLearning Low involvement, high involvementAttitudes Positive attitude, negative attitude

PSYCHOGRAPHICLifestyle Status seekers, conformists, couch potatoes, economy

minded

SOCIOCULTURALCultures Northerners, South Indians, East Indians, North EasternersReligion Christians: Catholics, Protestants, Hindus, Jews, MuslimsSub-cultures North Easterners, Dalits, OBC’s, Hispanics, Afro Americans,

Asians, Caucasians, Anglo Saxons

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Segmenting Consumer Markets

SEGMENTATATION /SEGMENTATATION VARIABLES

BASES

USE RELATED SEGMENTSUsage Rate Heavy Users, Moderate Users, Light Users, Non UsersAwareness Status Unaware, aware, interested, enthusiasticsBrand Loyalty None, Some, Strong

USE SITUATIONTime Morning, Night, Leisure, WorkObjective Personal, Gift, Snack, Fun, AchievementLocation Home, Work place, In store, Friends HomePerson Self, family members, boss, peersBenefit Social acceptance, economy, lasting, value for

money, convenience

HYBRID SEGMENTDemographic + PsychographicGeo-demographic Black Enterprise, Chinese company

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Market Segmentation Criteria

One the firm has identified its market-segment opportunities, it has to decide how many and which ones to targetTo be useful, market segments must rate favorably on 5 key criteria:MeasurableThe size, purchasing power and characteristics of the segments can be measuredSubstantialThe segment should be large and profitable enough to serveAccessibleThe segments can be effectively reached and servedDifferentiableThe segments are conceptually distinguishable and respond differently to different marketing-mix elements and programsActionableEffective programs can be formulated for attracting and serving the segments

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SOCIAL CLASS AND IMPACTON CONSUMER BEHAVIOR

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SOCIAL CLASS

Is a doctor more valued than a truck driver or a farm worker in our society?This is the indication of the reality of the existence of a social classDefinition:SOCIAL CLASS is defined as the division of members of a society into a hierarchy of distinct status classes, so that members of each class have relatively the same status and members of all other classes have either more or less statusStatus is frequently thought of as the relative rankings of members of each social class in terms of specific status factors:Relative wealth: Amount of economic assetsPower: The degree of influence over othersAnd Prestige: The degree of recognition received from

othersAll 3 status factors are frequently used when estimating social class

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SOCIAL CLASS

Individuals with more purchasing power or a greater ability to make purchases have more status

More convenient variables for status are demographic variables: family income, occupational status educational attainment

SOCIAL CLASS AND SEGMENTATION:Social class categories are usually ranked in a hierarchy, ranging from low to high status. Social class categories suggest to many people that others are equal to them, superior to them or equal to themWithin this context, social-class membership serves consumers as a frame of reference for the development of their attitudes and behaviorThe hierarchical aspect of social class is important to marketers. Consumers may purchase certain products because these products are favored by members of either their own or a higher social class, and consumers may avoid other products because they perceive the products to be “lower-class” products

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SOCIAL CLASS

SOCIAL CLASS CATEGORIES:

• Upper-upper class• Lower-Upper class• Upper-middle class• Lower-middle class• Upper-lower class• Lower-lower class

OR

• Blue collar, grey collar, white collar

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SOCIAL CLASS

MEASUREMENT OF SOCIAL CLASS CATEGORIES:

Systematic approaches for measuring social class fall into the following broad categories:

• Subjective measures• Reputational measures and• Objective measures

Subjective measures:Individuals are asked to estimate their own social-class positions. Typical of this approach is the following question: Which of the following categories best describes your social class?

• The Lower class ( )• The Lower-middle class ( )• The Upper-middle class ( )• The Upper class ( )• Do not know/refuse to answer ( )

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SOCIAL CLASS

MEASUREMENT OF SOCIAL CLASS CATEGORIES:

Systematic approaches for measuring social class fall into the following broad categories:

• Subjective measures• Reputational measures and• Objective measures

Reputational measures:The reputational approach for measuring social class requires selected community informants to make judgments concerning the social-class membership of others within the communityThe final task of assigning community members to social-class positions, however, belongs to the trained researcher

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SOCIAL CLASS

MEASUREMENT OF SOCIAL CLASS CATEGORIES:

Systematic approaches for measuring social class fall into the following broad categories:

• Subjective measures• Reputational measures and• Objective measures

Objective measures:These consist of selected demographic or socioeconomic variables concerning the individual under study. These variables are measured through questionnaires that ask the respondents several factual questions about themselves, their families, or their places of residence. Most researchers favor one or more of the following variables: Occupation, amount of income and educationTo the above socioeconomic factors, they add geo-demographic in the form of zip code, and residence neighborhood information

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The VALS Framework

Actualizers

Strugglers

Achievers Experiencers

Strivers Makers

Fulfilleds

Believers

Principle oriented

Status oriented

Action oriented

High Resources High Innovation

Low Resources Low Innovation

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The VALS Framework

Innovators

Survivors

Achievers Experimenters

Strivers Makers

Thinkers

Believers

Principle oriented

Status oriented

Action oriented

High Resources High Innovation

Low Resources Low Innovation

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The VALS Framework

Psychographic Segmentation:

The major tendencies of the four groups with higher resources are:Innovators:Successful, sophisticates, active, take-charge people with high self-esteem. Purchases, often reflect cultivated tastes for relatively upscale, niche-oriented products and servicesThinkers:Mature, satisfied, and reflective people who are motivated by ideals and value order, knowledge, and responsibility. Favor durability, functionality, and value in productsAchievers:Successful goal-oriented people who focus on career and family. They favor premium products that demonstrate success to their peersExperimenters:Young, enthusiastic, impulsive people who seek variety and excitement. Spend a comparatively high proportion of income on fashion, entertainment, and socializing

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The VALS Framework

Psychographic Segmentation:

The major tendencies of the four groups with lower resources are:Believers: Conservative, conventional, and traditional people with concrete beliefs. They favor familiar products, and are loyal to the established brandsStrivers:Trendy and fun loving who are resource constrained. They favor stylish products that emulate the purchases of those with greater material wealthMakers:Practical, down to earth, self-sufficient people who like to work with their hands. They favor products with a practical or functional purpose Survivors:Elderly, passive people who are concerned about change. They are loyal to their favorite brands

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U r a Mouse Potato or a Techno-Striver..?

Mouse Potatoes(willing to spend for the

latest in technotainment)

New Age Nurtures(big spender, focused ontechnology for home use)

Fast forwards(biggest spenders, early

adopters of new technologyfor all use)

Gadget-Grabbers(favor online entertainment

but have less cash to spend)

Digital Hopefuls(limited budget but still interested in new tech)

Techno-Strivers(use technology from cell phones and pagers to

online services primarily)

Media Junkies(seek entertainment, cannot find online, prefer TV and

other older media)

Traditionalists(willing to use tech but

slow to upgrade)

Hand-Shakers(older consumer, do not touch computers, leave

them to assistants)

SIDELINED CITIZENS (not interested in technology)

CAREER FAMILY ENTERTAINMENT

MORE AFFLUENT LESS AFFLUENT

OP

TIM

ISTS

PES

SIM

ISTS

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CONSUMER PERCEPTION

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PERCEPTION

PERCEPTION:

Perception is defined as the process by which an individual selects, organizes and interprets stimuli into a meaningful picture of the world

PERCEPTION IS OUR MAP OF REALITY

IF WE WISH TO CHANGE PERCEPTION WE WILL HAVE TO CHANGE ONE’S REALITY

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PERCEPTION - cont

IMPLICATIONS:

GENERIC:• Positioning • Addressing Segments• Brand personality• Communication message• Marketing Mix

SPECIFIC:• Packaging• Shelf merchandising• Color• Culture/Communities etc • Product details• Push• Promotions

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CONCEPTS

CONDITIONING:

THE PAVLOVIAN DOG – CLASSICAL CONDITIONING

Stimulus + Association through an object = Response

After repeated learning, even in the absence of the Stimulus a subject will elicit a response merely on the basis of the association of the object

EXAMPLES:• Aroma in restaurants / Strong Visuals of Food• Silence in a Board Room or at a funeral• A judge entering his chambers – silence and order follows• Background music in movies• Firecrackers signify celebration

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CONCEPTS

CONDITIONING:

REWARD AND PUNISHMENT - OPERANT CONDITIONINGB. F. SKINNER

The Human Desire for Strokes – positive and negative

Reward and punishment

Praise and Admonish

EXAMPLES:• Loyalty based promotions : Flying Returns, FCC• Scratch Cards with Gifts/Prizes• All the Current Car Finance Schemes

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CONCEPTS

WHATS THE MODUS OPERANDI:

How do you use Conditioning? What’s the channel?

THE 5 SENSES!!!

SENSATION – The immediate and direct response of the sensory organs to simple stimuli

The Human organs are the sensory receptors that marketers work on

Which is the strongest sense???

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CONCEPTS - cont

THRESHOLD:

Absolute threshold:The lowest level at which an individual can experience a sensationThe point at which a person can detect a difference between something and nothing is that persons absolute threshold for that stimulus.Adaptation is the variation that marketers are concerned about; this is technically called SENSORY ADAPTATION

EXAMPLES:• Billboards distance• Fonts on Billboards• Advertisements – positions in the newspapers

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CONCEPTS - cont

THRESHOLD:

Differential threshold:

The minimal differential that can be detected between two similar stimuli is called the differential threshold or also called the J.N.D. – Just noticeable difference

Credits : Ernst Weber! and called Weber’s Law

Weber's Law:

The JND between 2 stimuli is not an absolute amount but an amount relative to the intensity of the first stimulus.

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CONCEPTS - cont

Corollary to Weber’s Law: The stronger the initial stimulus, the greater the additional intensity needed for the stimulus to be perceived as different.

Marketing Applications/Implications of JND:1) Negative changes are not readily discernable to the

public and2) Product improvements are very apparent to consumers

without being wastefully extravagant

EXAMPLES: • NEW COKE• PACKAGING CHANGES• PEPSI – packaging 1997, COKE – freshness in color

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PERCEPTION – Is it a big deal!!!Or Is it much Ado About Nothing?

SUBLIMAL PERCEPTION:Stimulation below the levels of consciousness, but strong enough to be perceived by one or more of our receptor cellsThe stimulus is beneath the threshold, hence sublimal

THE CONCEPT OF SUPERLEARNING

EXAMPLES:• Super soft sublimal music with suggestions being put forth

through audio messages can actually induce positive buying behavior

• Sublimal visual messages with written suggestions induces purchase

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PERCEPTION - cont

USAGE OF THE SUBLIMAL CONCEPT IN-STORE

Store audio + Music

Restaurants + Music

PERCEIVED PRICING IN PROMOTIONS

Perceived Price and the Cost Price : Effect on Psyche

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Application of Perception Theory

RESTAURANT 1) MENU WITH FRAGRANCE 2) NATURAL HERBS WILL BE USED IN CONTINENTAL FOOD3) MAKE YOUR OWN DISH AS PER YOUR WISH4) OPEN KITCHEN - WATCH THE FOOD BEING COOKED5) MUSICIANS COMING AND PLAYING ON EACH TABLE AND

ENTERTAINING

DEPT. STORES 1) KIDS CORNER 2) PROMOTIONS 3) INVITE CELEBRITIES 4) CREATE FREE SPACE 5) DISTINCT SECTIONS 6) FREE MEHANDI

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LEARNING & PERCEPTION EXERCISE

a. What Stimuli would you build in line with Classical & Operant Conditioning for:b. What would you keep in mind to ensure the right Perception as well as the 2 Perception Laws for the future

1. A Car Dealership Showroom2. A Casino 3. A Café4. A Discotheque5. A Fast Food restaurant6. An International Airport7. An Educational Institute8. A Music Store9. A Shopping Mall10. A Book store11. A Multiplex12. A Chinese Restaurant

Rajeev Chawla 69

Application of Perception Theory

BOOKSTORE 1) SIT AND BROWSE 2) CREATE SMALL EVENTS FOR BOOK LAUNCHES3) BOOK READING SESSION FOR CHILDREN4) ANNUAL SECOND HAND BOOK SALE5) DISPLAY OF FAVOURITE TITLES - EVERY WEEK DIFFERENT6) LIGHT & SOUND EFFECTS FOR DIFFERENT SECTIONS 7) CREATE AN OUTER PRINT SECTION 8) CAFETERIA / COFFEE CORNER 9) CREATE DISPLAYS AT DIFFERENT SECTIONS 10)ALLOW PEOPLE TO LISTEN TO MUSIC WHILE READING IN THE

STORE- MUSIC IN CONSONANCE WITH WHAT YOU READ11)OXYGEN BARS IN BOOK STORES

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Application of Perception Theory

BOWLING ALLEY

1)AUDIO VISUAL SCREEN TEACHING YOU HOW TO BOWL- TIPS ON BOWLING

2)CAFETERIA & MUSIC

3)SCREENING OF SOME SPORT

4)HAVE EVENTS WHERE CELEBRITIES COME AND PLAY - CONTESTS FOR CELEBRITIES

5)GET SACHIN LOOK ALIKE

6)WHILE YOU ARE BOWLING RECORD AND SEE HOW YOU PLAY

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LEARNING & PERCEPTION EXERCISE

a. What Stimuli would you build in line with Classical & Operant Conditioning for:b. What would you keep in mind to ensure the right Perception as well as the 2 Perception Laws for the future

1. A Discotheque2. A Fast Food restaurant3. An International Airport4. An Educational Institute5. A Music Store6. A Shopping Mall7. A Book store8. A Multiplex9. A Chinese Restaurant10. A Car Dealership Showroom11. A Casino

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Culture & Sub-Culture

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CULTURE

CULTURE is a Society’s personality

The factors such as language, knowledge, laws, religion, practices, food customs, music, art, technology, work patterns, products and others comprise a Society’s culture

Hence CULTURE is a Society’s personality

Culture does not have boundaries

Definition of CULTURE

CULTURE is the sum total of learned beliefs, values and customs that serve to direct the consumer behavior of members of a particular society

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VALUES & BELIEFS

BELIEFS:

Beliefs consist of a large number of mental or verbal statements (as in …..I believe) which reflect a persons particular knowledge and assessment of something

VALUES:

Values differ by meeting the following criteria:

1) They are relatively few in number

2) They serve as a guide for culturally appropriate behavior

3) They are enduring or difficult to change

4) They are tied to specific objects or situations and

5) They are widely accepted by members of society

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CUSTOMS

CUSTOMS:Customs are overt modes of behavior that constitute culturally approved or acceptable ways of behaving in specific situations.

Thus: VALUES and BELIEFS are guides for behavior

But: CUSTOMS are usual and acceptable ways of behaving

Values & Beliefs of Corporations (Examples):

• WIPRO• IBM• APPLE• The new breed of FUN Corporations: Healthscribe

Rajeev Chawla 76

CULTURE

How CULTURE forms our Daily Habits:

• Eating Habits

• Personal Hygiene

• Food and Drink for Occasions

• Holidays

• Work Culture

• Dress Codes (Informal)

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LEARNING CULTURE

LEARNING CULTURE

a) Formal Learning

b) Informal Learning

c) Technical Learning

Advertising uses Informal Learning largely

It tends to create reinforcement of message to ingrain culture

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CULTURE - CHALLENGES

CHALLENGES OF CULTURE - Products

• Kellogs Breakfast Cereal

• Ready to eat Masala Foods

• Eating out

• The concept of Freshly prepared meals (India)

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CULTURE - LEARNING

CULTURE – WHERE DO WE LEARN FROM

• The Family

• Educational Institutions

• Houses of Worship

• Social Institutions

• The Work Place

• Peer Groups

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CHANGING CULTURE

Examples:

• Diapers• Cosmetics: Natural Products• Paper & Industry: Environmentally friendly products• Hotels: Eco friendly Hotels

THE DYNAMISM OF CULTURE:

• The Working woman• One child families• Families in decision making• Children in decision making• The single parent

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CULTURE

ENCULTURATION: The learning of one’s own culture

ACCULTURATION: The learning of a new or foreign culture

Examples:• McDonalds• The Pepsi Arabic example

LANGUAGE & SYMBOLS:

The use in Advertising and Communication• Logos• Brand Names• Visual symbols

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CULTURE - Rituals

RITUALS:

A type of symbolic activity consisting of a series of steps (multiple behaviors) occurring in a fixed sequence and repeated over time

Rituals are very public, elaborate, religious or civil ceremonies, formal, other scripted behavior and repeatable

Rituals tend to need ritual artifacts (products) that are associated with or somehow enhance the performance of the ritual

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CULTURE

CORE VALUES:

Values that affect and reflect the character of a Society. Core values must be pervasive, enduring and must be consumer-related

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CULTURE – Core Values

CORE VALUES: American Core Values

• Achievement and Success• Activity Orientation• Efficiency and Practicality• Progress• Material Comfort• Individualism• External Conformity• Humanitariasm• Youthfulness• Fitness and Health

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CULTURE

WHAT ARE CORE INDIAN VALUES:

• Indoctrination towards elders

• The Family Value (Joint family perhaps)

• Permanency to marriage

• Religion

• …………

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SUB-CULTURE

SUBCULTURE:

Distinct groups easily identifiable as a segment within a larger more complex society are called subcultures

The divisions are based on a variety of socio-cultural and demographic variables such as nationality, religion, geographic locality, race, age, sex and even working status

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SUB-CULTURE

MARKETING IN SUBCULTURES:

• Understanding subculture and behavior exhibited by that culture

• Segmenting the subculture

• Defining values, Behavior and Opportunities or relevance to Consumer Behavior

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SUB-CULTURE

SUBCULTURE PARAMETERS:

• Origins or Nationality

• Religion

• Geography & Regions

• Races

• Age

• Sex (Gender)

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SUB-CULTURE

CONSUMER BEHAVIOR: AN INTERNATIONAL PERSPECTIVE:

• Acculturation

• Exposure to Other Cultures

• Country of Origin Effect

• Multinationalism

• Global V/s Local

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ATTITUDE FORMATION AND CHANGE

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ATTITUDE FORMATION

ATTITUDES are our opinions or feelings towards an object, product or situation

ATTITUDES are evidenced or inferred from our behavior

Definition:

ATTITUDE is a learned predisposition to behave in a consistently favorable or unfavorable way with respect to a given object

Object = Product, product category, service, brand, advertisement etc

This is consumption oriented definition of attitude

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ATTITUDE FORMATION

ATTITUDES:

Attitudes are Learned

Attitudes have consistency

Attitudes occur within a situation

ATTITUDE STUDIES are therefore the study of the relationship between Attitude and Behavior

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ATTITUDE FORMATION

ATTITUDE STUDIES:

I) TRICOMPONENT ATTITUDE MODELII) MULTIATTRIBUTE ATTITUDE MODEL:

• The Attitude towards Object Model• The Attitude towards Behavior Model• The Theory of Reasoned action Model

III) THEORY OF TRYING TO CONSUMEIV) ATTITUDE TOWARDS THE AD MODEL

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ATTITUDE FORMATION

ATTITUDE STUDIES:

I)TRICOMPONENT ATTITUDE MODEL:

Attitude consists of 3 components:

a) A Cognitive component:

Knowledge and perception

Based on our beliefs

b) An Affective component:

Emotions of a product with amplification

c) A Conative Component:

The likelihood or tendency to act in a particular way

The intention to buy

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ATTITUDE FORMATION

ATTITUDE STUDIES:

I)TRICOMPONENT ATTITUDE MODEL:

Attitude consists of 3 components:

Conation

Affect

Cognition

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ATTITUDE FORMATION

ATTITUDE STUDIES:

I)TRICOMPONENT ATTITUDE MODEL:

Attitude consists of 3 components:

The Cognitive component:

This consists of a person’s cognitions, that is, the knowledge and perceptions that are acquired by a combination of direct experience with the attitude object and related information from various sources

The knowledge and resulting perception commonly take the form of beliefs that the attitude object possesses various attributes and that specific behavior will lead to specific outcomes

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ATTITUDE FORMATION

ATTITUDE STUDIES:

I)TRICOMPONENT ATTITUDE MODEL:

Attitude consists of 3 components:

The Affective component:

The consumer’s emotions or feelings about a particular product or brand constitute the affective component of an attitude

Affect-laden experiences also manifest themselves as emotionally charged states; eg., happiness, sadness, shame, disgust, anger, distress, guilt, or surprise

Research indicates that such emotional states may enhance or amplify positive or negative experiences and that later recollections of such experiences may impact what comes to mind and how the individual acts

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ATTITUDE FORMATION

ATTITUDE STUDIES:

I)TRICOMPONENT ATTITUDE MODEL:

Attitude consists of 3 components:

The Conative Component:

Conation, is concerned with the likelihood or tendency that an individual will undertake a specific action or behave in a particular way with regard to the attitude object

According to some interpretation, the conative component is frequently treated as an expression of the consumer’s intention to buy

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ATTITUDE FORMATION

ATTITUDE STUDIES:

II) MULTIATTRIBUTE ATTITUDE MODEL:

Consumer attitudes are a function of a consumers perception and assessment of the key attributes or beliefs held with regard to the particular attitude object

The Attitude towards Object Model

The Attitude towards Behavior Model

The Theory of Reasoned action Model

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ATTITUDE FORMATION

ATTITUDE STUDIES:

II) MULTIATTRIBUTE ATTITUDE MODEL:

The Attitude towards Object Model

This is suitable for measuring attitudes towards a product category or specific brands. The consumers attitude towards a product or service of a specific brand is a function of the presence or absence and evaluation of certain product-specific beliefs and/or attributes

Hence if the consumer evaluates an adequate level of attributes as positive, then they have a favorable attitude towards those brands

If the attributes are felt inadequate then the attitude towards the brand is unfavorable

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ATTITUDE FORMATION

ATTITUDE STUDIES:

II) MULTIATTRIBUTE ATTITUDE MODEL:

The Attitude towards Behavior Model

The attitude-towards-behavior model is the individuals attitude towards behaving or acting with respect to an object rather than the attitude itself

The appeal of the attitude-towards-behavior model is that it seems to correspond somewhat more closely to actual behavior than does the attitude-towards-object model

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ATTITUDE FORMATION

ATTITUDE STUDIES:

II) MULTIATTRIBUTE ATTITUDE MODEL:

The Theory of Reasoned action Model

The theory of reasoned action represents a comprehensive integration of attitude components into a structure that is designed to lead to both better explanation and better predictions of behavior

Like the tri-component model it also incorporates a cognitive component, an affective component and a conative component; however these are arranged in a pattern different from that of the tri-component model

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ATTITUDE FORMATION

II) MULTIATTRIBUTE ATTITUDE MODEL:

The Theory of Reasoned action ModelA SIMPLIFIED VERSION OF THE THEORY OF REASONED ACTION

Benefits that thebehavior leads

to certain outcomes

Evaluation ofthe outcomes

Beliefs that specificReferents think

I should or shouldnot perform the

behavior

Motivation tocomply with the

specific referents

Attitude towardthe behavior

Subjective norm

Intention Behavior

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ATTITUDE FORMATION

ATTITUDE STUDIES:

III) THEORY OF TRYING TO CONSUME:

Where the action or the outcome is not certain, but instead reflects the consumers attempt to consume (or purchase)

In such cases there are personal impediments and/or environmental impediments that might prevent the desired action or outcome from occurring

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ATTITUDE FORMATION

ATTITUDE STUDIES:

IV) ATTITUDE TOWARDS THE AD MODEL:

1) The consumer forms various feelings and judgments as a result of exposure to an ad.

2) This in turn affects the consumers attitude towards the ad and beliefs about the brand acquired from exposure to the ad

3) Finally the consumers attitude towards the ad and beliefs about the brand influence his attitude towards the brand

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ATTITUDE FORMATION

1) How are attitudes learned

2) The sources of influence on attitude formation

3) The impact of personality on attitude formation

How are attitudes learned:

• Theories of learning

• Classical Conditioning

• Operant conditioning

• Belief formation

• Motivation

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ATTITUDE FORMATION

1) How are attitudes learned

2) The sources of influence on attitude formation

3) The impact of personality on attitude formation

The sources of influence on attitude formation :

• Personal influence

• Family and friends influence

• Direct Marketing

• Mass Media

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ATTITUDE FORMATION

1) How are attitudes learned

2) The sources of influence on attitude formation

3) The impact of personality on attitude formation

The impact of personality on attitude formation :

• High need for Information

• Early innovators + reinforcement

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ATTITUDE CHANGE

ATTITUDE FORMATION and ATTITUDE CHANGE are both learned behavior

ATTITUDE CHANGE STRATEGIES are:• Changing the Consumers basic motivational function• Associating the product with an admired group or event• Resolving two conflicting attitudes• Altering components of the multi attribute model and• Changing consumer beliefs about competitor brands

COGNITIVE DISSONANCE

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Personality and Consumer Behavior

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Personality

As Marketers we appeal to Consumers in terms of their personality characteristics. This is based on the premise that What Consumers purchase, and when and how they consume, is likely to be influenced by personality factors

Hence appeals like:IndividualityTata Safari Make Your Own Road

Being challegedHyatt Resorts What time would you like to lose your dignity

Freedom (Finding yourself)Provogue Be the Attitude, Be the Change

Making a StatementSX4 The Men are Back

Personality

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PersonalityDefinition:The inner psychological characteristics that both determine and reflect how a person responds to his or her environment

The Nature of Personality:3 distinct properties of personality are of central importance:

• Personality reflects individual differencesPeople as individuals are different. They could be adventurous, serious by nature, gregarious, lively, sad, mission oriented, etc

• Personality is consistent and enduringEven though consumer’s personalities may be consistent, their consumption behavior often varies considerably because of the various psychological, socio-cultural, environmental, and situational factors that affect behaviorHowever an individuals personality is consistent given these differences

• Personality can changeUnder certain circumstances, personalities change. Personality may be altered by major life events, such as birth of a child, death of a loved one, a divorce, significant career promotions

Personality

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Personality: An Overview of the Theories of Personality

Freudian theory:Unconscious needs or drives are at

the heart of human motivation

Neo-Freudian personality theory :Social relationships are fundamental to

the formation and development of personality

Trait theory :Quantitative approach to personality

as a set of psychological traits

Personality

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Personality: The Theories of Personality

Freudian theory:Sigmund Freud’s psychoanalytic theory of personality is a cornerstone of modern psychology

The premise of the theory is that: Unconscious needs or drives, especially sexual or other biological drives are at the heart of human motivation and personality

Freud constructed his theory on the basis of patient’s recollections of early childhood experiences, analysis of their dreams, and their specific nature of their mental and physical adjustment problems

Freud proposed that the human personality consists of three interacting systems: the Id, the Superego, and the Ego

Personality

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Personality: The Theories of PersonalityFreudian theory:Freud proposed that the human personality consists of three interacting systems: the Id, the Superego, and the EgoId:

The Warehouse of primitive or instinctual needs for which individual seeks immediate satisfaction – basic physiological drives and needs such as thirst, hunger, and sex – for which individuals seek immediate satisfaction without concern for the specific means of satisfaction

Superego:The Individual’s internal expression of society’s moral and

ethical codes of conductThe Superego’s role is to see that the individual satisfies needs

in a socially acceptable fashion. It acts like a ‘brake’ that restrains or inhibits the impulsive forces of the Id

Ego:The Individual’s conscious control that balances the demands

of the id and superego. It functions as an internal monitor that attempts to balance the impulsive demands of the Id and the socio-cultural constraints of the superego

Personality

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Personality: The Theories of Personality

Freudian theory:Freud emphasized that an individual’s personality is formed as he or she passes through a number of stages of infant, and childhood developmentThese are the oral, anal, phallic, latent, and genital stagesAccording to Freudian theory, an adult’s personality is determined by how well he or she deals with the crises that are experienced while passing through each of these stagesFor instance, if a child’s oral needs are not adequately satisfied at the first stage of development the person may become fixated at this stage and as an adult display a personality that includes such traits as dependence and excessive oral activity like gum chewing and smokingWhen an individual is fixated at the anal stage, the adult personality may display traits such as an excessive need for neatness

Personality

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Personality: A Representation of the Interrelationships among the Id, The Superego, and the Ego

Personality

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Personality: Freudian Theory and Product Personality”

Consumer researchers using Freud’s personality theory see consumer purchases as a reflection and extension of the consumer’s own personality

With Respect to Snack Food and Personality Traits as an Example:Potato Chips:Ambitious, successful, high achiever, impatientTortilla Chips:Perfectionist, high expectations, punctual, conservationalPretzels:Lively, easily bored, flirtatious, intuitiveSnack Crackers:Rational, logical, contemplative, shy, prefers time alonePopcorn:Takes charge, pitches in often, modest, self-confident but not a show-offMeat Snacks:Gregarious, generous, trustworthy, tends to be overly trusting

Personality

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Personality: The Theories of Personality

Neo-Freudian theories:We seek goals to overcome feelings of inferiorityWe continually attempt to establish social relationships with others to reduce tensionsAlfred Alder viewed human beings as seeking to attain various rational goals, which he called style of life. He also placed much emphasis on the individual's efforts to overcome feelings of inferiorityHarry Stock Sullivan, another Neo-Freudian, stressed that people continuously attempt to establish significant and rewarding relationships with others Karen Horney was interested in child-parent relationships and desires to conquer feelings of anxiety. She proposed that individuals can be classified into three personality groups: Compliant, Aggressive, and Detached

• Compliant individuals move toward others, they desire to be loved, wanted, and appreciated

• Aggressive those individuals who move against others• Detached move away from others

Personality

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Personality: The Theories of Personality

The Trait Theory:Personality theory with a focus on psychological characteristicsTrait - any distinguishing, relatively enduring way in which one individual differs from anotherTrait theorists are concerned with the construction of personality tests that enable them to pinpoint individual differences in terms of specific traitsPersonality is linked to how consumers make their choices or to consumption of a broad product category - not a specific brand

Personality tests measure such traits as:• Consumer Innovativeness – how receptive a person is to new

experiences• Consumer Materialism – the degree of the consumer’s

attachment to ‘worldly possessions’ and• Consumer Ethnocentricity – the consumer’s likelihood to

accept or reject foreign-made products

Personality

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Personality: The Theories of Personality

The Trait Theory:1. Consumer Innovativeness and Related Personality TraitsInnovativenessThe degree to which consumers are receptive to new products, new services, or new practicesDogmatismA personality trait that reflects the degree of rigidity a person displays toward the unfamiliar and toward information that is contrary to his or her own established beliefsSocial characterRanges on a continuum for inner-directedness to other-directedness

Personality

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Personality: The Theories of Personality

The Trait Theory:1. Consumer Innovativeness and Related Personality TraitsInner-directedness

• Rely on own values when evaluating products• Innovators

Other-directedness• look to others• less likely to be innovators

Need for uniquenessConsumers who avoid appearing to conform to expectations or standards of othersOptimum stimulation level (OSL)A personality trait that measures the level or amount of novelty or complexity that individuals seek in their personal experiencesHigh OSL consumers tend to accept risky and novel products more readily than low OSL consumers

Personality

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Personality: The Theories of Personality

The Trait Theory:

1. Consumer Innovativeness and Related Personality Traits Sensation seekingClosely related to the OSL concept is sensation seeking, which has been defined as “a trait characterized by the need for varied, novel, and complex sensations and experience, and the willingness to take physical and social risks for the sake of experience”Variety-novelty seekingMeasures a consumer’s degree of variety seekingExamples include:

• Exploratory Purchase Behavior• Use Innovativeness• Vicarious Exploration

Personality

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Personality: The Theories of Personality

The Trait Theory:2. Consumer Materialism to Compulsive ConsumptionThese are traits that range from consumer materialism to fixated behavior to consumer compulsive behaviorConsumer materialismMaterialism, as a personality trait, distinguishes between individuals who regard possessions as essential to their identities and their lives and those for whom possessions are secondaryResearchers have found some general support for the following characteristics of materialistic people:

• They especially value acquiring and showing off possessions

• They are particularly self-centered and selfish• They seek lifestyles full of possessions• Their many possessions do not give them great satisfaction

Personality

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Personality: The Theories of Personality

The Trait Theory:2. Consumer Materialism to Compulsive ConsumptionThese are traits that range from consumer materialism to fixated behavior to consumer compulsive behaviorFixated Consumer BehaviorSomewhere between materialism and compulsion, with respect to buying or possessing objects, is the notion of being fixated with regard to consuming or possessingLike materialism, fixated consumption behavior is in the realm of normal and socially acceptable behaviorFixated consumers so not keep their objects or purchases of interest a secret; rather, they frequently display them, and their involvement is openly shared with others who have a similar interestFixated consumers typically possess the following characteristics:

• A deep interest in a particular object or product category• A Willingness to go to considerable lengths to secure additional

examples of the object or product category of interest and• The dedication of a considerable amount of discretionary time and

money to searching out the object or product

Personality

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Personality: The Theories of Personality

The Trait Theory:2. Consumer Materialism to Compulsive ConsumptionThese are traits that range from consumer materialism to fixated behavior to consumer compulsive behaviorCompulsive Consumption BehaviorCompulsive Consumption is in the realm of abnormal behavior – it is an example of the dark side of consumptionConsumers who are compulsive have an addiction; in some respects they are out of control, and their actions may have damaging consequences to them and those around themExamples of compulsive consumption problems are uncontrollable shopping, gambling, drug addiction, alcoholism, and various food and eating disordersFor instance, there are many women and a small number of men who are chocoholics - they have an intense craving for chocolateTo control or possibly eliminate such compulsive problems generally requires some type of therapy or clinical treatment

Personality

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Personality: The Theories of Personality

The Trait Theory:3. Consumer Ethnocentrism- Responses to Foreign-Made ProductsTo distinguish between consumer segments, that are likely to be receptive to foreign-made products and those that are not, researchers have developed ad tested the consumer ethnocentrism scale, called CETSCALEThe CETSCALE has been successful in identifying consumers with a predisposition to accept (or reject) foreign-made productsConsumers who are highly ethnocentric are likely to feel that it is appropriate or wrong to purchase foreign-made products because of the resulting economic impact on the domestic economy, whereas non-ethnocentric consumers tend to evaluate foreign-made products – ostensibly more objectively – for their extrinsic characteristicsEthnocentrism has been found to vary by country and productFor example:

– Mexican consumers, for example, have been found to be more ethnocentric than their French and American counterparts

– Some older American consumers still refuse to purchase German and/or Japanese products

Personality

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Personality: The Theories of PersonalityThe Trait Theory:3. Consumer Ethnocentrism- Responses to Foreign-Made Products

The CETSCALE Items

Personality

1. American people should always buy American-made products instead of imports

2. Only those products that are unavailable in the U.S. should be imported

3. Buy American-made products. Keep America working.4. Purchasing foreign-made products is un-American5. It is not right to purchase foreign products, because it puts

Americans out of jobs6. A real American should always buy American-made products.7. We should purchase products manufactured in America

instead of letting other countries get rich off us8. It is always best to purchase American products

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Personality: The Theories of PersonalityThe Trait Theory:3. Consumer Ethnocentrism- Responses to Foreign-Made Products

Personality

This ad is designed to

appeal to consumer

ethno-centrism.

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Brand Personality

Consumers attribute various descriptive personality traits or characteristics to different brands in a wide variety of product categoriesFor example, consumers see Brands as having the following charactristics:

Volvo is SafeNike represents the athlete in usBMW is a Performance driven machineLevi’s 501 is dependable and rugged

Such personality-like images of brands reflect consumers’ visions of the inner core of many strong brands of consumer products A Brand’s personality can be either functional, or symbolicAs long as it is strong and favorable, it will strengthen the brand

Brand Personality

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A Brand Personality Framework

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Brand Personification

Product Personality and Gender

Product Personality and Geography

Brand Personality

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Product Personality and Geography

Personality and Color

Brand Personality

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The Howard Sheth Model(John Howard & Jagdish Sheth)

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The Howard Sheth Model OR The Black Box Model

The Howard Sheth model shows the interaction of stimuli, consumer characteristics, decision process and consumer responses. It can be distinguished between interpersonal stimuli (between people) or intrapersonal stimuli (within people). The Howard Sheth model is related to the black box theory of behaviorism, where the focus is not set on the processes inside a consumer, but the relation between the stimuli and the response of the consumer. The marketing stimuli are planned and processed by the companies, whereas the environmental stimulus are given by social factors, based on the economical, political and cultural circumstances of a society. The buyers black box contains the buyer characteristics and the decision process, which determines the buyers response

The black box model considers the buyers response as a result of a conscious, rational decision process, in which it is assumed that the buyer has recognized the problem. However, in reality many decisions are not made in awareness of a determined problem by the consumer

The Howard Sheth Model

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The Howard Sheth Model OR The Black Box Model

INFORMATION SEARCH:Once the consumer has recognised a problem, they search for information on products and services that can solve that problem. Belch and Belch (2007) explain that consumers undertake both an internal (memory) and an external search

Sources of information include:• Personal sources • Commercial sources • Public sources • Personal experience

The relevant internal psychological process that is associated with information search is perception. Perception is defined as 'the process by which an individual receives, selects, organises, and interprets information to create a meaningful picture of the world'

The Howard Sheth Model

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The Howard Sheth Model OR The Black Box Model

INFORMATION SEARCH:The selective perception process

Stage Description• Selective exposure consumers select which promotional

messages they will expose themselves to• Selective attention consumers select which promotional

messages they will pay attention to• Selective comprehension consumer interpret messages in

line with their beliefs, attitudes, motives and experiences• Selective retention consumers remember messages that are

more meaningful or important to themThe implications of this process help develop an effective promotional strategy, and select which sources of information are more effective for the brand

The Howard Sheth Model

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The Howard Sheth Model OR The Black Box Model

INFORMATION SEARCH:

Purchase decision

Once the alternatives have been evaluated, the consumer is ready to make a purchase decision. Sometimes purchase intention does not result in an actual purchase. The marketing organization must facilitate the consumer to act on their purchase intention. The provision of credit or payment terms may encourage purchase, or a sales promotion such as the opportunity to receive a premium or enter a competition may provide an incentive to buy now. The relevant internal psychological process that is associated with purchase decision is integration

The Howard Sheth Model

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The Howard Sheth Model OR The Black Box Model

INFORMATION SEARCH:

Postpurchase evaluation

It is common for customers to experience concerns after making a purchase decision. This arises from a concept that is known as “cognitive dissonance”. The customer, having bought a product, may feel that an alternative would have been preferable. In these circumstances that customer will not repurchase immediately, but is likely to switch brands next time

To manage the post-purchase stage, it is the job of the marketing team to persuade the potential customer that the product will satisfy his or her needs. Then after having made a purchase, the customer should be encouraged that he or she has made the right decision

The Howard Sheth Model

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l

The Howard Sheth Model OR The Black Box Model

INFORMATION SEARCH:

Internal influences

Consumer behaviour is influenced by: demographics, psychographics (lifestyle), personality, motivation, knowledge, attitudes, beliefs, and feelings. Consumer behaviour concern with consumer needs, and consumer actions in the direction of satisfing needs leads to his behaviour. Behaviour of every individual depends on his thinking process

External influences

Consumer behaviour is influenced by: culture,sub-culture, locality, royalty, ethnicity, family, social class, reference groups, lifestyle, and market mix factors

The Howard Sheth Model

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The Decision Making Process

Need Recognition

InformationSearch

Evaluation

Purchase

Outcome

MARKETING

STIMULI

Environment Stimuli

Personal Characteristics

Satisfaction Dissatisfaction

Action

PR O CESS ROLES

RESPONS E

DECISION

SET

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The Engel, Blackwell, Kollat Model(The EBK Model)

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Decision Making Process- EBK Model ( Engel, Blackwell, Kollat Model)

Need Recognition

Search

Evaluation

Purchase

Consumption

Dissatisfaction Satisfaction

Post-consumption

Evaluation

Stimuli-Marketer dominated

-- non-marketer

-dominated

External search

Exposure

Attention

Comprehension

Acceptance

Retention

MEMORY

INTERNAL SEARCH

Environment Influences

-cultureSocial class

FamilySituation-personal

influences

Individual Differences-Motivation-Knowledge

-Attitude-Personality

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Decision Making Process-EKB Model( Engel, Kollat, Blackwell, Model

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Question Bank - Assignment

1. Explain the Decision Making Model. Detail decision making for your Client when he contracts business with your firm

2. Detail one Motivational Theory (Maslow, Herzberg or Theory Z) and give live examples of how your firm could impact employees lives through this theory

3. Describe Classical Conditioning and what are the right stimuli you could build for your Clients

4. If the Reward-Punishment theory works then detail it w.r.t the right rewards you could build for your Clients

5. Explain Culture, Sub culture, Beliefs, Values and Customs with examples specific to your work place: Clients, employers, etc

6. How does Enculturation and Acculturation work if you want to set up your firms’ business in India and in U.A.E.

7. Describe any one theory in detail of how Attitudes are formed with examples

8. If we were to attempt to change the Attitude Indian consumers have towards Fast Food then how would you go about it

9. If you are trying to promote a new concept with your clients how would you attempt to move them into positive acceptance. Make assumptions

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TEXT BOOKS

Consumer Behavior: 9th Edition

Leon Schiffman and Leslie Kanuk

Consumer Behavior: 5th / 6th Edition

Michael Solomon

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Rajeev Chawla

•Consultant-Marketing and General Management•Corporate trainer•Educationist

Cell: 93205-20203

[email protected] [email protected]

Brand Building - Sourcing

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• Fresh Lettuce comes from Pune, Delhi, Nainital and Ooty

• Cheese form Dynamix Dairies, Baramati, Maharashtra

• Buns from Cremica, Phillaur, Punjab and Mrs. Bector and Sons, Khopoli, Maharashtra

• Sauce from Bector Foods, Phillaur, Punjab and Hindustan Lever Limited-Best Foods Division, Thane

• Chicken Patties, Vegetable Patties, Pies and Pizza McPuff™ from Vista Processed Foods, Taloja, Maharashtra

• Dairy Products from Amrit Food, Ghaziabad, UP

• Distribution center at Radhakrishna Foodland

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• Mrkt 2

[email protected]

• 8805653470

• Mrkt 1

[email protected]

• 9921823169