Roger D. Blackwell Clare D’Souza Mehdi TaghianPaul MiniardJames Engel
Consumer Behaviour
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COPYRIGHT © 2006 Thomson Learning Australia
What is consumer behavior?
Activities people undertake when obtaining, consuming, and disposing of products and services
A field of study that focuses on consumer activities
Scope goes beyond just why and how people buy to include consumption analysis
ObtainingObtaining ConsumingConsuming DisposingDisposing
ConsumerConsumerinfluencesinfluences
OrganisationalOrganisationalinfluencesinfluences
Consumer behavior
Consumer Consumer influencesinfluences
Organisational Organisational influencesinfluences
Culture EthnicityPersonality FamilyLife-stage ValuesIncome Available resourcesAttitudes OpinionsFeelingsMotivations Past experiencesPeer groupsKnowledge
Brand Product featuresAdvertising Word of mouthPromotions Retail displaysPrice QualityService Store ambianceConvenience Loyalty programsPackaging Product availability
ObtainingObtaining ConsumingConsuming DisposingDisposing
How you decide you want to buy
Other products you consider buying
Where you buy
How you pay for product
How you transport product home
How you use the product
How you store the product in your home
Who uses the product
How much you consume
How product compares with expectations
How you get rid of remaining product
How much you throw away after use
If you resell items yourself or through a consignment store
How you recycle some products
The marketing concept
The process of planning and executing the conception, pricing, promotion, and distribution of ideas, goods and services to create exchanges that satisfy individual and organisational objectives
Satisfaction with an exchange depends on satisfaction with consumption of product and the exchange of money
Why study consumer behaviour?
Consumer behavior determines the success of marketing programs
Marketing can be used to influence brand choice and purchase, while de-marketing can influence people to stop harmful consumption
‘The Customer is King’:Organisation influenced by consumer needs and wants
Why study consumer behaviour?
Organisations that are customer-centric use a total marketing approach to focus their resources on satisfying customers
Marketing is the process of transforming or changing an organisation to have what people will buy
Why study consumer behaviour?
Consumer behavior determines everyone’s economic health:
The individual’s decisions as a consumer determine their economic health by making more effective consumption decisions while avoiding deceptive practices harmful to them
Public policy leaders and social commentators study consumer behavior to alleviate over-consumption and under-consumption by educating consumers about problems and providing assistance
Understanding consumers’ issues or problems and developing methods to reach and educate consumers
Educating consumers about health
Understanding consumers’ needs to formulate public policy and predicting behavioral changes that follow
Studying consumer behaviourhelps formulate public policy
Interest rates
Warning
labels
EconomicsSocial Welfare Family
Planning
Government
Regulations
Government Protection and Education
Protection from Competitive Markets
Personal policy includes how you behave towards others and in buying situations, your values and beliefs, and how you live your life
A person’s economic quality of life is determined by personal policy
Consumer behaviour affects personal policy
Evolution of consumer behavior
Supply chain:all the organisations involved in taking a product from inception to final consumption
- Manufacturers- Wholesalers- Retailers- Facilitating organisations
Consumers’ increased influence on business
Evolution of consumer behaviour
Wholesaler Manufacturer Retailer Consumer
ManufacturingOrientation
ConsumerOrientation
SellingOrientation
MarketingOrientation
US 1750-1850 1850-WWII 1970-2000 2000+
Europe 1750-1850 1760-WWII 1970-2000 2000+
Consumers’ increasing influence
Manufacturing orientation
Selling orientation
Marketing orientation:- Motivation research- Positivism- Postmodernism
Consumer orientation
Evolution of consumer behaviour
Consumer orientation
Beyond a marketing focus
How all organisations in a demand chain adapt to changing consumer lifestyles and behaviors bringing product design, logistics, manufacturing, and retailing together
Role of consumers in shaping many aspects of life – society, government, social programs, health cares, and other areas
Studying consumer behaviour: Consumer research methodsObservationObserving consumer behaviors in different situations such as natural or artificial settingsIn-home observation: examining how and when consumers use and consume products in their households
Shadowing: following and observing consumers in the shopping and consumption processes. Researchers may ask questions about reasons for behaviors
Physiological methods: techniques borrowed from medicine, psychology and other sciences including cameras to measure eye movement, galvanic skin response, and MRI
Consumer research methods
Interviews and surveys
Surveys: efficient method for gathering information from a large sample of consumers by asking questions and recording responses (telephone and Internet surveys, mall intercepts, and mail questionnaires)
Focus groups: a group discussion led by a moderator skilled in persuading consumers to thoroughly discuss a topic of interest
Longitudinal studies: repeated measures of activities over time to determine changes in opinions, buying, and consumption behaviors
Consumer research methods
Experimentation
Measuring cause-and-effect relationships by manipulating independent variables to determine the effects of changes on dependent variables
- Laboratory experiment- Field experiment
Independent variables might include number of advertisements and package design
Dependent variables might include purchase intent or behavior
Consumer research methods
Consumption research builds on the three primary research methods to examine how people use products and services rather than how they buy them
May use ethnographic tools to under-stand how values and culture influence usage of products and other behaviors
May identify new uses for existing products or new product to satisfy unmet or changing consumer needs
Underlying principles of consumer behaviour
The consumer is sovereign
The consumer is global
Consumers are different
Consumers are alike
The Underlying Principles of Consumer Behavior
The Consumer Is Sovereign
The Consumer Is Global
Consumers Are Different; Consumers Are Alike
The Consumer Has Rights
Consumer Bill of Rights
Refer to DOCEP (Department of Consumer and Employment Protection) in Western Australia for information on consumer rights. Remember that consumer rights may vary across countries in the South East Asian region.
Challenges for the future
Gathering and interpreting information that organisations need to meet changing needs of consumers
Developing effective consumer research methods to capture changes in trends and lifestyles
Understanding consumer behaviour from a broader perspective as an important part of life