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Chapter 5: Consumer Behavior
The activities people engage in whenselecting, purchasing, using, and disposing
of products and services
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Why Study Consumer Behavior
Marketers¶ success in influencing purchase behavior
depends on how well they understand consumer behavior
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Magnitude of Importance
In 2009, US consumers spent $10.1 trillion!
In 2009, over 125,000 new products were introduced(most were brand extensions)
59% of purchases are unplanned
Consumers are more likely to make an unplanned
purchase when the product is displayed at the endof an isle
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Consumer Behavior Trends
Changing gender
roles
Health products
Self-expression
Convenience
goodsConsumer to consumer
E-commerce
Need tobe connected
Convenient
shopping Desire for
green goods
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Consumer Decision Making
Postpurchase evaluation
Product choice
Alternative evaluation
Information search
Problem recognition
DecisionDecision--Making StagesMaking Stages
Cognitive Dissonance, Bhv &C
ognitive Learning
Decision Rules: Integration,Heuristics
Attitude formation
Perception, Attention,Behvioral & Cognitive Learning
Motivation (Maslow)
Psychological ProcessPsychological Process
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Decision Making: A Matter of Involvement
1 ± Problem Recognition2 ± Information Search3 ± Alternative Evaluation4 ± Product Choice5 ± Postpurchase Evaluation
Involvement
Perceived Financial Risk
Perceived Social Risk
Routine (Habitual) Purchase Decision: Low Involvement(2-3 steps)
Extensive Problem Solving: High Involvement
(all 5 steps)
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Stage 1- Problem Recognition
Out of Stock Dissatisfaction New Needs
or Wants
Related Products,Purchases
Market-InducedRecognition
NewProducts
Consumer has a need (actual state ideal state)
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Marketers help consumers recognizeproblems by tapping into needs
Self-actualization(self realization)
Physiological(hunger, thirst)
Safety
(security, protection)
Social
(sense of belonging, love)
Esteem
(recognition, status)
Maslow¶s Hierarchy of Needs
Which need is this ad tapping?
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Which need is this ad tapping into?
Self-actualization(self realization)
Physiological(hunger, thirst)
Safety
(security, protection)
Social
(sense of belonging, love)
Esteem
(recognition, status)
Maslow¶s Hierarchy of Needs
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Stage 2 ± Information Search
Bob Needs
a New Car
Internal search
(memory)
Personal sources
(word of mouth)
Market sources
(TV, Mags, News)
Internet : Brings up issues
of behavioral targeting
Bob can searchInternal sources
Bob can searchExternal sources
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Behavioral Targeting
Behavioral targeting uses information collected on an individual's web-
browsing behavior (via cookies), such as the pages they have visited
or the searches they have made, to select which advertisements to
display to that individual.
Behavioral Targeting allows site owners or ad networks to display
content more relevant to the interests of the individual viewing the
page.
Theoretically: Properly targeted ads will fetch more consumer interest,
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Behavioral Targeting
Again, tracking a user¶s online travels (digital footprint, via cookies)
in order to strategically place ads or product recommendations
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Retargeting Example
1. You go to Google and search for µnew BMW convertible¶, which leads you to the BMW pagethat tells you all about the new M6 convertible. Not a bad looking ride!
2. You take a look at the page for a while, but just like 98% of most web-surfers you don¶ttake any action on the page (email a dealership, download vehicle info, etc.) and youtake off to another page that you also found on your Google search.
3. Unknowingly to you (and most other online shoppers), BMW µdropped a ³cookie´ onyou, which basically means that they stored a little piece of data on your computer thatsays something like µthis person is looking for a new BMW convertible¶. This piece of datais small, but very powerful and can be used to follow your every move on the web for upto several days and even weeks.
4. As you surf around other websites you may or may not notice that there is an increasinglyodd amount of BMW ads that seem to be popping up everywhere. If you do notice theseads following you around, you might think that it¶s just a coincidence, but it isn¶t.
The intended goal of these retargeted ads are to follow you around long enough towhere you eventually make your way back to the original BMW site so that you¶ll make
a purchase, download some information or any other action that they would like you,
as a potential customer, to do.
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Back to Stage 2 ± Information Search
Bob Needs
a New Car
Internal search(memory)
Personal sources(word of mouth)
Market sources(TV, Mags, News)
Internet
Bob can searchInternal sources
Bob can searchExternal sources
What determineswhat informationBob attends to?
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Information Search: A Matter of Perception and Attention
Perception
Process of selecting, organizing, and interpreting information
Internal factors
(past experiences,culture, beliefs)
Stimuli themselves
(color, size, etc)These influence
what we perceive
Selectivity occurs at all stages of the perceptual process
Selective Attention(we choose what
to focus on)
Selective Comprehension(we interpret information based
on our own attitudes, beliefs)
Retention(we retain what is
relevant to us)
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The ³F´ Exercise
Count the number of ³F¶s´ in the passage below
FINISHED FILES ARE THE RE-SULT OF YEARS OF SCIENTIF-
IC STUDY COMBINED WITH
THE EXPERIENCE OF YEARS.
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How many F¶s were there?
FINISHED FILES ARE THE RE-
SULT OF YEARS OF SCIENTIF-
IC STUDY COMBINED WITH
THE EXPERIENCE OF YEARS.
6 F¶s
Even when you¶ve been told what to search for
and attend to, you may still ³miss´ the point
Now imagine advertisers¶ frustrations
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Influencers on Perception & Attention
The information that we select, organize, and interpretcan be influenced by:
Behavioral Learning
Classical Conditioning (associative learning) ± process whereby a neutral
stimulus (Snuggle Fabric Softener) becomes a conditioned stimulus (CS)
capable of eliciting a given response (super soft) after being repeatedly
presented with an unconditioned stimulus (US) (teddy bear)
Teddy Bear (US) = Super soft (UR)
Fabric Softener (CS) + Teddy Bear (US) = Super soft
Fabric Softener (CS) = Super soft (CR
)
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More Classical Conditioning
Pro Athletes (US) = Incredible Athletic Talent (UR)
Nike (CS) + Pro Athletes (US) = Incredible Athletic Talent
Nike (CS) = Incredible Athletic Talent (CR)
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More Behavioral Learning
Behavioral Learning
Operant Conditioning ± learning that occurs as the result of rewards
or punishments
Rewarded for using the soap
(smell nice)
Punished for not using the soap
(smell bad)
Spray and Wash: Puni shed
Didn¶t work, clothes still stained
Oxi Clean: Rewarded
Stains out, clothes clean
Page Example
Again, thi s can
influ ence what
inf ormat i on or st i muli
we sel ect-to attend to
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More Observational Learning
Consumer observes benefits of these products
Consu mer wants the prod u ct
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Information Search and Learning TheoriesRecap
Again, what information we select and interpret can be influenced by:
Classical Conditioning
Operant Conditioning
Observational Learning
Example Reaction
Knowledge of famouspro athletes ± gets attention
Interpret brand as high
performance (b/c of pro assn)
If involved with product(care about laundry), likely toattend to message
Interpret brand as poor based on past ³punishment´
Counter-argue the message
If involved with product(want to get fit), likely toattend to message
Interpret brand as effective
(thru observation, works)
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Stage 3 ± Alternative Evaluation
All Available BrandsBrand A Brand B Brand C Brand D Brand E
Brand F Brand G Brand H Brand I Brand J
Brand K Brand L Brand M Brand N Brand O
Evoked Set of Brands
Brand B Brand E
Brand I
Brand M
Brand F
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Alternative Evaluation
Evoked Set Example:
When I say ³fast food,´ what restaurants come to mind?
This is your Evoked Set
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The Multiattribute Model of Attitudes(not in your book but very important)
Multiattribute Attitude Model: A consumer¶s attitude toward
a brand is a function of his/her
1- belief about the brand¶s performance on attribute(i ), and
2- the importance of the attribute to the overall evalulation
AB = Sum of (Bi X Ei )
AB = attitude toward a brand
Bi = belief about the brand¶s performance on attribute i
Ei = importance attached to attribute i
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Nissan Altima
Multiattribute Attitude Example: AB = Sum of (Bi X Ei )
Honda Accord Toyota Camry
Honda Accord
Toyota Camry
Nissan Altima
Design MPG
23 city/32 hwy
safety rating 9.2
22 city/31 hwy safety rating 9.9
23 city/33 hwy safety rating 8.7
Safety Total
+
+
+
+
+
+ =
==
(BxE) (BxE) (BxE)
Change Bi
Change Ei
Add an Attribute
Change perceptions of competitors¶ attributes
Bi = belief about the brand¶s performance on attribute i
Ei = importance attached to attribute i
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AB = Sum of (Bi X Ei )
Colgate Total
Ultrabrite AdvWhitening
Tom¶s of Main Anticavity
ADA approved Price Total
+
+
+
+
+
+ =
=
=
(BxE) (BxE) (BxE)
Whitening Rating
ADA 8.0 $3.50
No ADA 9.8 $2.25
ADA 7.9 $3.60
Change Bi
Change Ei
Add an Attribute
Change perceptions of competitors¶ attributes
Bi = belief about the brand¶s performance on attribute i
Ei = importance attached to attribute i
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Stage 4 ± Product Choice
Product evaluation is not the same as actual choice
May evaluate Honda as the best but actually choose Nissan
May evaluate Ultrabite as the best, but actually choose Colgate
Heuristics Information Integration
Consumers combine or integratepieces of information into one
overall judgment
Mental rules-of-thumb used for aspeedy decision, such as:
Actual Decisions may be based on:
multiattribute attitude model
price equals quality
brand loyalty
country of origin
always buy low prices
OR
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Stage 5 ± Postpurchase Evaluation
Satisfaction/Dissatisfaction
Cognitive Dissonance (post-purchase regret)
comes from creating an accurate expectation of the product
Marketers Goal: Create an accurate expectation
anxiety or regret from purchase decision (³maybe I should
have bought brand X instead´)
Marketers Goal: Reinforce purchase decision (³congratulations
on your new purchase ± you made the right choice), service-follow
up, relationship marketing
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Decision Making Recap
Stage Psychological Process Marketers Influence
Problem Recognition
Information Search
Alternative Evaluation
Product Choice
PostpurchaseEvaluation
Motivation (Maslow)
Perception, Attention,Behavioral & Cognitive
Learning
Attitudes
Information Integration,Heuristics
Satisfaction/Dissatisfac.Cognitive Dissonance,
Stimulate or tap into a need
Get consumer to pay attention tobrand via behavioral and
cognitive marketing strategies
Change beliefs about an attribute,change perceived importance of an attribute, add an attribute,change perceptions of competitors
Offer sales promotions, attractivefinancing, etc.
Create accurate expectations of product, service-follow-up,relationship marketing
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Consumer Decision Making: Skidmore
Stages of Consumer Decision Making:
1. Problem Recognition - which of Maslow¶s needs could be used to targetthe problem? How would you, as a college, stimulate students¶ need?
2. Information Search - how did you search for information on different colleges?What could Skidmore do better to attract your attention?
3. Alternative Evaluation - what attributes were important in your ³collegepurchase´ decision? How were the attributes weighted
4. Purchase Decision - how did (or could) Skidmore induce you to ³purchase´ it(once you¶ve decided that it¶s the best alternative)?
5. Postpurchase Evaluation - are you satisfied or do you feel cognitive dissonance?
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Influencers on Consumer Decision Making
Internal Influencers personality
age lifestyle
Social Influencers culture subculture (environmentalism) social class group membership
opinion leaders gender roles
Situational Influencers physical environment
time presence of others in-store cues
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Internal Influencers: Personality
Personality
A unique set of psychological characteristics that consistently influence
The way a person responds to situations in the environment (and hence
Influences their purchases)
Innovative
Materialism
Self confidence
± cutting edge consumers, try new things
± like status goods
± positive evaluation of one self, buy what they like
Sociablity ± enjoys social interactions, likes entertainment products
Need for Cognition ± big thinkers, evaluates products before buying
M arketers create brand personali t i es to match target market
e.g., Car Compani es
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Internal Influencers: Age
Generation Year Key Characteristics
Baby Boomers 1946 to 1964
Generation X(baby bust,Latchkey kids)
1965 to 1976 Maintain a cautiouseconomic outlook
Respond to sociallyresponsible co.¶s
Primary buyers of
most goods by 2010
Generation Y(Millennials,echo boomers)
1977-1994 72 million strong High tech Job fits their lifestyle,
not visa-versa
Want responsibility
Represent 28% of thepopulation
Spend >50% of discretionary income
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Marketers cater to the Generations
Baby BoomersGeneration XGeneration Y
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Internal Influencers: Lifestyle
Psychographics
Grouping consumers according to their values and
lifestyles ± or their activities, interests, and opinions (AIO)
Mountain Dew
Fidelity Investments
Huggies Diapers
What are the lifestyle
characteristics of the
consumers who buy
these products?
Understanding consumers¶ lifestyles helps to better
promote a brand
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Situational Influencers: PhysicalEnvironment
Wal Mart Bass Pro Shop
Décor, smell, lighting
arousal and pleasure determine consumers¶ reaction to store environment
retail experience and entertainment help to enhance the shopping experience
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Social Influencers: Culture
Values, beliefs, customs, and tastes of a group of people
Venezuelan Adidas ad: Picking your team
US Nike ad: focus onindividual performance
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Social Influencers: Subculture
A group within a society whose members share a distinct
set of beliefs, characteristics, etc.
Moms
College students
Soccer players
Trekkies
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Social Influencers: Ethnic Subculture
Major Ethnic Subcultures inMajor Ethnic Subcultures in thethe USUS 2010-2030
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Social Influencers: Ethnic Subculture
2008 data: censusPopulation(in millions)
Buying Power (in millions)
Top Purchases
White
African
American
Hispanic(largest)
Asian(fastestGrowing)
228
46.9
37.6
13.4
* Total us Population is 309 million (table doesn¶t reflect ³others´)
9,136
951
913
509
phone svcs
utilitiesapparel
footware
groceries
foodhousingmajor appliances
telecom svceducationpersonal ins
groceriesphone servicesfurniture
gasolineclothingfootware
S i l I fl Eth i S b lt
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Social Influencers: Ethnic Subculture
Nat i onal
ackg round of ¡
¢ i an ¡
£ ¤ r i cans
Filipino%
J p n9%
Kor n1 %
i n
1 %
hin9%
h r
14%
H ispani c S cul tur s
¥
¦ §
i ̈
©
n
¦
ri¨ ©
n
64%
¦
r
o Ri ̈
©
n
10%
©
n
4%
h
¦
r
©
ino
1
%
rk ing i k :
Treating all people withinan ethnic group as
homogeneous
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Ethnic Ads
Maybelline's Garnier usesSpanish-language ads totarget the Hispanic market.
Maybelline's Color
Sensational Lipstick usesspecific ads to target theAfrican American market.
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Social Influence: Going Green
Green Marketing Greenwashing
Marketing strategy that supports
environmental stewardship
(protect the environment in all
business activities)
Environmentally friendly claims
that are exaggerated or untrue
Tyson chickens are injectedwith antibiotics before they
are hatched
BEESWAXNaturally replenishing
moisturizer made by bees.
Hydrating barrier that
keeps lips moisturized.
PETROLATUM A non-renewable material
derived from crude oil.
Moisturizes with
an oil based film.
vs
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Social Influencers: Social Class
Mass Class
Millions of consumers who enjoy a level of purchasing
power that¶s sufficient to afford them high-quality products
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Social Influencers: Group Membership
Reference Group Group, class, or category of people which individuals
believe they belong to, or aspire to belong to
Conformity
Changing one¶s behavior to in reaction togroup pressure (bandwagon effect)
Tupperware parties
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Social Influencers: Opinion Leaders
People who influence others¶ attitudes or behaviors
because others perceive them as having expertise
Flip Phillips: Professor of Neuroscience
Knows all things technology
Among the first to buy goods and are a powerful
marketing tool (they talk, blog, etc.)
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Social Influencers: Gender Roles
Society¶s expectations regarding appropriate attitudes,
behaviors, and appearance for men and women
Consumers often associate ³sex-typed´ products with
one gender or another
Sex roles are evolving: e.g., Metrosexuals
Bratz Dolls(prosta-tots) Western fun isfor boys
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Male Cosmetics
vs.
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Male Cosmetics
AvonP
roExtreme Moisturizer C
linique Maximum Hydration
Fudge Putty Hair gel
Nivea Firming Eye Gel
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Male Cosmetics
M4Men Hair Wax
Clear Nail Polish for Men
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Male Cosmetics
L¶Oreal Anti-Wrinkle Cream for Men
l
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Male Cosmetics Case Questions
1. Do you consider the purchase decision for male cosmetic-oriented products to be ahigh or low involvement decision? Why?
2. Which of Maslow¶s Hierarchy of Needs do you feel most motivates men to purchasecosmetic-oriented products?
3. How do men learn about male oriented cosmetics? Where do they search for
information?
4. Based on the multiattribute attitude model, how do you think the marketing of malecosmetic products differs from the marketing of female products? Try contrasting themarketing by product type.
For example:
- fragrances
- hair care
- skin care
5. Which social influence factor has the greatest impact on men¶s decision to purchasecosmetic-oriented products?
AB = Sum of (Bi X Ei )Bi = belief about the brand¶s performance on attribute i
Ei = importance attached to attribute i
Culture, subculture, social class, group membership,opinion leaders, gender roles
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Male Cosmetics
What¶s driving the market?
Metrosexuals, Queer Eye for the Straight Guy
How big is the market?
$37.5 billion (2 )
Who is the main target for male grooming products?
2 -35 year old males
Females: predominant buyers of male grooming products (55 )
What are the biggest brands of male grooming products?
Nivia, Gillette, Clarins, Clinique, L¶Oreal, Estee Lauder,
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Male Cosmetics
What are men buying?Facial cleansers, moisturizers (including tinted)
hair coloring (tangible benefit), toning/firming products
How to market to men?
Language is key: Communicate the fact that the products arefunctional, not effeminate
* no: ³enhances your appearance´* yes: ³defends your skin´
Simple brand names with promise: Defender, Perfecter, Improver,Reviver, Enhancer
Promotion: Display active lifestyles, sports, the promise of sex
Educate: Explain the product (e.g., ³bar soaps dry the skin, Brand X
cleans and moisturizes)
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Male Cosmetics: In Class Case
Introduce a new cosmetic/grooming product aimedat the male market (young men and/or older)
what is the product?
how would you package it?
how would you promote it?
where would you sell (distribute) it?