Topic 5 - Consumer Behavior

Consumer

Behavior



Process through which

buyers make decisions



Every buying decision is

influenced by external

and internal factors—

often by what

consumers believe

others expect of them.



Three broad categories

of interpersonal

influences on consumer

behavior: cultural, social,



Marketers borrow from the

sciences of psychology and

sociology.



B = f(P, E)



In this sense, behavior is a

function of both

interpersonal influences

(culture, friends,

classmates, coworkers, and

relatives) and personal

factors (attitude, learning,

and perception).

Interpersonal

CULTURAL INFLUENCES

 Culture - the values, beliefs, preferences, and tastes handed down from one generation to the next.

 It is the broadest environmental determinant of consumer behavior, so marketers need to

understand its role in consumer decision making, both here and abroad.

 Marketing strategies that work in one country or region may be offensive or ineffective in another, especially were population is quickly diversifying.

Filipino Core Values

Professor Felipe M. de Leon, Jr.

Commissioner, NCCA Chairman, NLTA

University of the Philippines

KAPWA

(share identity)



the core of Filipino

psychology, it is humaneness

at the highest level



implies unique moral

obligation to treat one

another as equal fellow

human beings

Filipino Core Values

PAKIRAMDAM

(SHARED INNER PERCEPTION)

 Knowing Through Feeling or

Tacit Knowing; Participatory Sensitivity)

 A unique social skill

inherent in Filipino personhood

 The need for openness and

basic trust is a precondition for this active process of

Filipino Core Values

Kagandahang Loob

(SHARED

HUMANITY)



Pagkamakatao; A Shared Inner

Nobility; A Quiet Sense of

Responsibility for Others; A Great

Compassion for All Living Beings)



Nudges a person towards genuine

Pakikisama

DEEPEST LEVEL OF INVOLVEMENT WITH

ANOTHER PERSON STILL CONSIDERED AN OUTSIDER (IBANG TAO)

Characteristic tendencies of this trait

are giving in to another person’s

wish, demands, wants or desires

The motive for this could be politeness

or expectation of future concessions

or immediate rewards

International Perspective on

Cultural Influences

 Marketing strategies that work in prove

successful in one country may not often cannot extend to others international markets due to cultural because of cultural vaiations..

 Packaging can be interpreted in many ways and may contain different information in various

cultures.

 Some products must be adapted to fit tastes and palates if they are to succeed in various cultures.

Subcultures



Each culture

has

subcultures

groups with

their own

distinct

modes of

behavior.



Cultures are not homogeneous

entities with universal values, though

core values do dominate..

SOCIAL INFLUENCES

 Every consumer belongs to a number of social groups.

 Group membership influences an individual’s

purchase decisions and behavior in both overt and subtle ways.

 Groups establish norms, which are

values, attitudes, and behaviors that a group deems appropriate for its members and even for nonmembers who aspire to join.

Social Influences

 Buying behavior is affected by differences in group status and role.

 Group status refers to the relative position of any individual member in a group.

 Group role refers to formal or informal guides for

behavior that is expected of members who hold specific positions in the group.

 People often make

purchases that reflect their status within a group.,

particularly regarding

expensive purchases within affluent groups.

Asch

Phenomenon



Asch found that

individuals

conform to

majority rule,

even if that

majority rule

went against

their beliefs

Reference Groups

 Reference groups – groups whose

values, structures, and standards influence a person’s behavior..

 Consumers often try to coordinate

their purchase behavior with their

perceptions of values of their reference group’s values

 Strong from a reference group requires

two conditions:

 _{Purchased product must be seen and} identifiable.



Reference groups tend to affect

the purchase of luxury, gourmet,

or designer items more than

everyday purchases.



Children are especially vulnerable

to the influence of reference

groups that they aspire to, and to

ads with celebrity endorsements

Social Class



Socioeconomic Classification



Upper A Php Php 100,000+



Upper B Php 50,001-99,999



Upper Middle C1 Php

30,001-50,000



Middle C2 Php 15,001-30,000



Lower DE 15,000 and below

Social Class

 People in one social class

may aspire to a higher class and exhibit buying behavior common to that class, rather than to their own..

 Marketers often attract

consumers in higher social classes by offering

exclusive memberships or special services not

Opinion Leaders

 Information about goods and services may

flow from the media (Internet, TV, radio, print) to opinion leaders and then to other consumers, or directly to consumers. .

 Some opinion leaders influence purchases

by others merely through their own actions, which consumers decide to emulate.

 Opinion leaders are trendsetters within a reference group

who are likely to purchase new products before others in the group and then share their experiences and opinions via word of mouth.

 Generalized opinion leaders are rare; people which rotate

in and out of this role depending on their knowledge of or interest in specific products often take this role, found in all segments of the population.

 Most people are members of at

least two families in their

lifetime—the one they’re born into and the one they form later in life.

 The family group is perhaps the

most important determinant of consumer behavior because of close and ongoing interactions among members..

 Each family has norms of expected

behavior, and different roles and status relationships for its

members.

Philippine Family Structure



2 in every 5 households have OFW

family member



3 out of 10 OFWs have broken

families



It is a norm that both parents are

 Marketers describe

the role of each

spouse in terms of four categories

 Autonomic role—

partners independently make equal numbers of decisions.

 Husband-dominant role

—the husband makes most of the purchase decisions.

Children and Teens

 Children and teenagers influence

what parents buy, are exposed to endless messages, are more

sophisticated about purchasing than previous generations were.

 They create a huge market of

more than 50 million, wielding $192 billion in purchasing power annually.

Personal

NEED AND MOTIVES

 A need is an imbalance between the consumer’s actual and

desired states..

 Someone who recognizes or feels a

significant or urgent need then seeks to correct the imbalance..

 Marketers arouse this sense of

urgency by making a need “felt” and suggesting a product to satisfy it.

 Motives are inner states that

direct a person toward the goal of satisfying and that prompt some action.

Maslow’s Hierarchy

of Need

Maslow’s Hierarchy of

Needs



person must at least partially

satisfy lower-level needs

before higher needs can

affect behavior



In developed countries where

basic needs are more likely

already satisfied,

higher-order needs may be more

important to consumer

Maslow



The theory says that

once a need is satisfied,

it no longer has to be

met, so the individual

moves on to the next

level of needs.



But it has flaws—some

don’t move through the

hierarchy; some fixate on

a certain level or relate to

PERCEPTIONS

 Perception is the meaning that a person attributes to incoming

stimuli gathered through the five senses—sight, hearing, touch, taste, and smell.

 A buyer’s behavior is influenced by his or her perceptions of a good or service.

 Buyers’ perceptions depend as much on what they want to

A person’s perception of an

object or event results from

the interaction of two types of

 Stimulus factors—

characteristics of the physical object. (size, color, weight,

shape).

 Individual factors—unique

characteristics of the individual (sensory processes,

experiences with similar

Perceptual Screens

 People are bombarded by

marketing messages today.

 The typical supermarket carries

30,000 packages, network TV stations typically air 60,000 commercials a week.

 The increased marketing clutter

has caused people to ignore many promotional messages,

responding only to those that break through their

 perceptual screens—the mental

filtering process that all inputs must pass.

Breaking Perceptual

Screens

 _{Marketers determine which stimuli}

evoke good responses, create a message that stand outs and gets the attention of prospective

customers..

 _{Doubling the size of a print ad}

breaks through the clutter,

increasing its attention value by 50 percent; use of white space, dark backgrounds, or color also attract viewers.

 _{The psychological concept of}

closure—the human tendency to perceive a complete picture from

Breaking Perceptual

Screens

 Word-of-mouth marketing can get attention by a more natural path of conversation.  Virtual reality displays 3-D

marketing messages and info via merchandise tours or

walks through service venues.  Selective perception leads to

brand loyalty as customers tune out info that doesn’t match beliefs and

Subliminal Perception

 Subliminal perception is the

subconscious receipt of incoming information.

 Subliminal advertising is. aimed at

the subconscious level of awareness to circumvent perceptual screens, and though condemned as

manipulative, it is unlikely to induce buying except by people already

inclined to buy.

 _{There are three reasons for this:}

 strong stimulus factors are needed to

Subliminal

Perception

 Emotions do play a vital

role in decision making, so marketers look for ways to elicit emotional feelings toward

purchasing a product..

 Neuromarketing is a new

technology that beams

commercials or messages to certain individual

customers in particular areas of stores.

ATTITUDE



Attitudes are the

enduring favorable or

unfavorable

evaluations,

emotions, or action

tendencies toward an

object or idea.

Attitude

stimuli is greatly affected by attitudes about the product, store, or

 Attitudes form over time via

individual experiences and

group contacts, and are highly resistant to change.

 Because favorable attitudes

likely affect brand

preferences, marketers need to determine consumer

Attitude Components

the individual’s information and knowledge about an

object or concept.

 affective component deals with feelings or emotional reactions.

 behavioral component involves tendencies to act in a certain manner.

 All components have stable and

Changing consumer

 Marketers have two choices

regarding attitudes:

 _{to encourage consumer attitudes}

that motivate purchase of a particular product;

 _{to evaluate existing consumer}

attitudes and make the product features appeal to them.

 If consumers view an existing

item unfavorable, the seller may redesign it or offer new options.

 But a negative attitude may not

be truly unfavorable; it just may not motivate the consumer to

Modifying the

 Attitudes frequently change in

response to inconsistencies among the three components.

 Attitudes change when new

information changes the cognitive or affective

components of an attitude, such as when benefits are given or

misconceptions are corrected.

 Attitudes change when buyers

are engaged in new behavior that gets them to try a product

Modifying the



Attitudes change when new

technologies encourage

consumers to change their

attitudes.

Marketing looks at not

only changes in consumer

decisions over time, but

also at the current status

Learning

Marketing looks at not

only changes in consumer

decisions over time, but

also at the current status

Learning

refers to immediate or expected changes in

consumer behavior based on experience.

 It includes the

components of :

 drive (any strong stimulus

that impels action) and;

 cue (any object that

determines the nature of a person’s response to a

Learning



A response is an

individual’s reaction to a

set of cues and drives.



Reinforcement is the

reduction in drive that

results from a proper or

rewarding response, so

a strong bond links the

drive and the purchase

and increases the

chance of future

purchases.

Applying it Marketing



Shaping refers to applying a

series of rewards and

reinforcements to permit

more complex behavior to

evolve over time



Both promotional strategy

and the product itself play a

role in the shaping process.

Shaping Process

1.

getting consumers to try a

product, possibly using a cue

such as a sample or coupon.

2.

entice the consumer to buy

the product with little

financial risk.

3.

motivate the person to buy

the item again at a moderate

cost, with the only

reinforcement being

Self Concept Theory

 Self-concept—a person’s

multifaceted picture of

himself or her self—plays an important role in consumer behavior..

 It comes from the

interaction of many

influences—both personal and interpersonal—that affect buying behavior.

 A person’s needs, motives,

perceptions, attitudes, and learning are at its core,

4 Components of Self Concept



Real self—an objective view

of the total person.



Self-image—the way an

individual views himself or

herself.



Looking-glass self—the way

an individual thinks others

see him or her.



Ideal- self—the image to

which the person aspires.

 Consumers are likely to

choose products that will move them closer to their ideal

Consumer

Decision

 Even if they’re unaware of it,

consumers complete a step-by-step process in making purchase decisions.

 The time and effort spent on particular purchasing decision depends on the importance of the desired good or service.

 _{High-involvement purchase}

decisions are those with greater levels of potential social or

economic consequences.

 _{Low-involvement purchase}

decisions are routine purchases that pose little risk to

Problem or opportunity

recognition

 During the first stage in the

decision process, the consumer becomes aware of a significant discrepancy between the

existing situation and a desired situation.

 Marketers help prospective

buyers identify and recognize potential problems or needs in the form of advertising,

Search

 During the second step,

the consumer gathers information about

attaining a desired state of affairs.

 The search identifies

alternative ways to solve

the problem and may cover internal sources (mentally reviewing or recalling past experience) or external

sources (gathering opinions and info)

Search identifies alternative

brand to consider



The number of alternatives

that a consumer actually

considers is called the evoked

set.



In some searches the

consumer knows the brands

that merit further

consideration; in others,

external searches bring

together this new information.

Evaluation of alternatives



Actually, some evaluation

takes place in the second

step as consumers

accept, distort, or reject

information found.



A brand or product is

chosen from the evoked

set, or the decision is

made to keep looking for

alternatives.

Evaluative criteria are the

features that a consumer

considers in choosing among

alternatives

 These criteria may be

objective facts.

 The criteria may also be

subjective impressions.

 Common criteria include

price, brand name, and

country of origin, and can vary with the consumer’s age, income, social class,

Marketers attempt to

influence the outcome in

three ways:

 By educating consumers

about attributes that they view as important in evaluating certain goods

 By identifying which

evaluative criteria are important to an

individual and showing why a specific brand fulfills those criteria

 By inducing a customer

to expand the evoked set to include the

 The fourth and fifth steps involve the eventual purchase decision and the act of making the purchase.

 By this time, each alternative in the evoked set has been weighed, based on the individual’s own evaluative criteria, and the alternatives have been narrowed down to one.

 The consumer then decides on the purchase location.

 Marketers help smooth the purchase by offering benefits such as

Postpurchase evaluation

produces one or two results.

 The buyer feels

satisfaction at the removal of the

discrepancy between the existing and desired

states, usually if the purchase meets or exceeds expectation.

 The buyer feels anxiety

Cognitive



A buyer often experiences

postpurchase anxiety from an

imbalance among a person’s

knowledge, beliefs, and

attitudes.



It might include worry about

paying too much or

Cognitive dissonance

may increase in three



When the value of the

purchase increases



When the rejected

alternatives have

desirable features not

seen in the chosen

alternative



When the purchase

Dealing with cognitive

high-involvement purchases.

 The consumer may focus on

the item’s good points and

ignore anything dissatisfactory.

 Marketers may help reduce

cognitive dissonance by

providing information that supports the chosen item.

 The consumer may decide to

change products and vow to

Classifying consumer

problem-solving

problem solving, and extended problem

solving.

 The classification of a

purchase within this framework influences the consumer-decision process.

Routinized response

behavior

 A consumers makes many

routine purchases by

choosing a preferred brand or one of a few acceptable brands .

 The consumer has already

set evaluative criteria and identified options, so any further external search is limited.

 It’s most common in

buying very

Limited problem

criteria for a certain kind of

purchase,then encounters a new, unknown brand..

 _{The buyer spends a moderate} amounts of time and efforts in external searches and in applying the evaluative criteria to assess the new brand..

 _{This limited problem solving is} affected by the number of

evaluative criteria and brands, the extent of external search, and the process for determining

Extended Problem

Solving

 The consumer feels brands are

difficult to categorize or evaluate., so begins to

compare one with another.

 The consumer needs to

understand the product features before evaluating alternatives..

 This extended problem

solving refers to a lengthy external search, usually in high-involvement purchase decisions.