Fundamentals Of Fundamentals Of MarketingMarketing

MKT243MKT243

Chapter 3Consumer and Business

Decision Making

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Slides OutlineSlides OutlineImportance of understanding of consumer

behaviorConsumer buying behaviorConsumer Decision Making ProcessTypes of Consumer Buying DecisionFactor Influencing consumer buying

decision

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Importance of understanding Importance of understanding consumer behavior consumer behavior Consumers’ product and service

preferences are constantly changingUnderstanding how consumer make

purchase decisions can help marketing managers to determine the most important attribute for certain target market

Easily design and developing marketing strategy

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Model of Consumer BehaviorModel of Consumer Behavior

Consumer buyer behavior refers to the buying behavior of final consumers—individuals and households who buy goods and services for personal consumption

Consumer market refers to all of the personal consumption of final consumers

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Model of Consumer BehaviorModel of Consumer Behavior

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The Buyer Decision ProcessThe Buyer Decision Process

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Need recognitionNeed recognition

Occurs when the buyer recognizes a problem or need triggered by:

◦Internal stimuli◦External stimuli

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Information searchInformation search

Sources of information:

Personal sources—family and friends

Commercial sources—advertising, Internet

Public sources—mass media, consumer organizations

Experiential sources—handling, examining, using the product

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Evaluation of AlternativeEvaluation of AlternativeDHD 2012

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Evoked SetEvoked Set

Purchase!Purchase!

Analyze product attributesAnalyze product attributes

Rank attributes byimportance

Rank attributes byimportance

Use cutoff criteriaUse cutoff criteria

Purchase DecisionPurchase Decision

The act by the consumer to buy the most preferred brand

The purchase decision can be affected by: ◦Attitudes of others◦Unexpected situational factors

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Post purchase decisionPost purchase decision

The satisfaction or dissatisfaction that the consumer feels about the purchase

Relationship between:◦Consumer’s expectations◦Product’s perceived performance

The larger the gap between expectation and performance, the greater the consumer’s dissatisfaction

Cognitive dissonance is the discomfort caused by a post-purchase conflict

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Types Buying Decision BehaviorTypes Buying Decision BehaviorDHD 2012

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Types of Buying Decision BehaviorTypes of Buying Decision Behavior

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Factors Influencing Consumer Factors Influencing Consumer Buying DecisionBuying Decision

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Factors Influencing Consumer Factors Influencing Consumer Buying DecisionBuying Decision

Culture is the learned values, perceptions, wants, and behavior from family and other important institutions

Subculture are groups of people within a culture with shared value systems based on common life experiences

and situations◦Hispanic◦African American◦Asian◦Mature consumers

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Factors Influencing Consumer Factors Influencing Consumer Buying DecisionBuying Decision

Social classes are society’s relatively permanent and ordered divisions whose members share similar values, interests, and behaviors

Measured by a combination of occupation, income, education, wealth, and other variables

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Groups and Social NetworksGroups and Social NetworksDHD 2012

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Word-of-mouth influence and buzz marketingOpinion leaders are people

within a reference group who exert social influence on others

Also called influentials or leading adopters

Marketers identify them to use as brand ambassadors

Online Social Networks are online communities where people socialize or exchange information and opinions

Include blogs, social networking sites (facebook), virtual worlds (second life)

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Groups and Social NetworksGroups and Social Networks

Social FactorsSocial Factors

Family is the most important consumer-buying organization in society

Social roles and status are the groups, family, clubs, and organizations that a person belongs to that can define role and social status

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Personal FactorsPersonal Factors

Age and life-cycle stage

RBC Royal Band stages◦Youth: younger than 18◦Getting started: 18–35◦Builders: 35–50◦Accumulators: 50–60◦Preservers: over 60

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Personal FactorsPersonal Factors

Occupation affects the goods and services bought by consumers

Economic situation includes trends in:

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Personal FactorsPersonal Factors

Lifestyle is a person’s pattern of living as expressed in his or her psychographics

Measures a consumer’s AIOs (activities, interests, opinions) to capture information about a person’s pattern of acting and interacting in the environment

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Personality and self conceptPersonality and self conceptDHD 2012

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motivationmotivation

A motive is a need that is sufficiently pressing to direct the person to seek satisfaction

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Characteristics Affecting Characteristics Affecting Consumer BehaviorConsumer Behavior

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Maslow’sHierarchy of Needs

Psychological FactorsPsychological Factors

Perception is the process by which people select, organize, and interpret information to form a meaningful picture of the world from three perceptual processes

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Psychological FactorsPsychological Factors

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Learning is the change in an individual’s behavior arising from experience and occurs through interplay of:

Psychological FactorsPsychological Factors

Belief is a descriptive thought that a person has about something based on:

KnowledgeOpinionFaith

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Psychological FactorsPsychological Factors

Attitudes describe a person’s relatively consistent evaluations, feelings, and tendencies toward an object or idea

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