Consumer behaviour(sec a ,sec b combined)

1

IMT

Section B

Paras Arora IMTDCP084

Mahesh Dontul IMTDCP078

Himanshu Saxena IMTDCP075

Chandan Kumar Singh IMTDCP071

Consumer Behavior

Section A

Sanrang

Mahima Walial

Vishal Javeri

Ankita Varma

2

IMT

Various stimuli

3

IMTBehavioral Fundamentals = ƒ(P,E)

Personal interaction

Environment

+

Behavior

4

IMTBuying a product is a result of many things sum total of these things is Consumer Behavior

Buying decision made

Market and environmental

stimulus

Marketing mix

Cultural

Education

Consumer characteristics

Social, Personal, cultural

Consumer Psychology

Motivation, Learning,

Memory, Perception

Involvement in Decision making

High involvement

Moderate involvement

Low involvement

Consumer Decision making

process

Five stage model

5

IMTConsumer Behavior Simplified

Consumer is any one who can instill a stir in the market.

• Initiator

•Gatekeeper

• Influencer

•Decider

•Buyer

•User

•Disposer

Consumer

• Individual

•Social

•Psychological

•Pre Purchase

•During Purchase

•Post Purchase

Behavior

Consumer Behavior

Creating effective visuals

Behavior is outcome of a person’s interaction with the environment.

6

IMT7 O’s model of Buying Behavior

7 O’s Details

Occupants Individuals, Shops, Small offices, Educational and Research, Clinics, Restaurants, Fast food joints etc

Objects High power efficiency, Durability, Low maintenance, Aesthetics, Affordability, Efficient service, Brand name

Objectives Comfort, luxury, Status symbol, Necessity, Maintenance of electronic equipment.

Organizations Individuals- Entire family, Shops, Clinics, Organizations-Technical consultants, Stake holders etc

OperationsMarket place cash, Credit cards, Cheques, Demand

Drafts, Electronic Fund transfer

OccasionClimatic conditions, Discount, New residential or commercial establishments, Replacements etc

OutletsRetail shops, Authorized dealers, Hypermarkets,

Specialized markets, Online buying.

7

IMTProcess model of Buying Behavior

ENVIRONMENTAL FACTORS BUYER'S BLACK BOXBUYER'S RESPONSEMarketing

StimuliEnvironmental Stimuli

Buyer Characteristics

Buyer Psychology Decision Process

Product Price PlacePromotion

Economic Technological Political Cultural Demographic Natural

Cultural Social Personal

Motivation Perception Learning Memory

Problem recognition Information search Evaluation of alternative Purchase decision Post-purchase behaviour

Product choiceBrand choiceDealer choicePurchase timingPurchase amount

8

IMTFactors Influencing Consumer Behavior

Culturala) Cultureb) Subculturec) Social Class

Personala) Ageb) Lifecycle

stagec) Genderd) Incomee) Educationf) Personalityg) Self concepth) Lifestyle

Sociala) Family b) Friendsc) Roled) Status

Physiologicala) Motivationb) Learningc) Perceptiond) Attitude

Buyer

9

IMTRelationship Between Culture and Subculture

Example:-

10

IMTCultural

In USA In Japan

In JapanIn Korea

11

IMT

An ad showing many racial subcultures

Cultural

This ad for Vibe Vixen magazinetargets the African American urban subculture

Subculture

Subculture

12

IMTCultural contd..

Social class

13

IMTPersonal

AgeAge

14

IMTPersonal Contd..

Gender

Self ConceptIncome

15

IMTPersonal contd..

Life style

Education

AttitudePersonality

16

IMTSocial

Family

Friends

Status

Role

17

IMTPsychological

18

IMTConsumer Involvement in Decision Making

Habitual decisions Simple decisions Lengthy decisions

eg. Tea, toothbrush, eg. Skin creams ,TV eg. Cars, Property Washing powder. microwave oven .

HIGH INVOLVEMENT

LOW INVOLVEMENT

MODERATE INVOLVEMENT

19

IMTTypes of Buying

Variatio

n in

consumer choice

phenomenon

Low involvement

Hedonic

Utilitarian / Instrumental

20

IMTVariations in Consumer Choice Phenomena

Utilitarian / Instrumental

Low Involvement

Hedonic / Ego Expressive

Feel Do (Know)Trigger = Impulse, Need, Pleasure

Rationalizing evaluation of alternativesProcess: Choice Heuristic: “Buy What I

Like”Ultimate Choice: Satisfying Model

Price as secondary concern

21

IMTVariations in Consumer Choice Phenomena

Utilitarian / Instrumental

Low Involvement

Hedonic / Ego Expressive

Know Feel Do Trigger = Gap (actual – Desired)

Active SearchRational use of information; Rational

evaluation of alternativesProcess: Extensive Problem Solving

routine responseChoice Heuristic: “Buy the Best”Ultimate Choice: Trade off among

competing alternativesPrice as trade-off variable

22

IMTVariations in Consumer Choice Phenomena

Utilitarian / Instrumental

Low Involvement

Hedonic / Ego Expressive

Know Do FeelTrigger = Stock Depletion

Passive SearchLimited / No evaluation of alternatives;

Rational Use of informationExpectancy – Confirming

Process: Choice Heuristic: “Buy the Familiar” “Buy the Cheapest”

Ultimate Choice: Satisfying ModelPrice as deciding Factor

23

IMTMarketing Considerations Across Core Motivational Conditions

Utilitarian / Instrumental

Low Involvement

Hedonic / Ego Expressive

Keys to Continuity: Product Performance; Provision of

InformationCentral Threat to continuity: Better Performing Alternative

Keys to Continuity: Clear, Relevant articulation of Brand

ImageCentral Threat to continuity: Change in self or brand image

Keys to Continuity: Saliency of Brand, ensured product availability

Central Threat to continuity: interrupts in purchase cycle

24

IMTTypes of Buying Decision Behavior

HighInvolvement

Significantdifferences

betweenbrands

Fewdifferences

betweenbrands

LowInvolvement

ComplexBuyingBehavior

Variety-SeekingBehavior

Dissonance-Reducing BuyingBehavior

HabitualBuyingBehavior

25

IMTTypes of Buying behavior

Significant

differences

betweenbrands

Fewdifferenc

esbetween

brands

HighInvolvement

LowInvolvement

Complex buying Variety seeking

Habitual Buying Dissonance Reducing Behavior

26

IMTExamples of Buying behavior-Complex

Cars Economy

1) I10

2) A star

3) Alto

4) Santro

5) Wagon R

6) Zen

7) RitZ

8) Spark

9) Beat

10) Swift

Digital Camera

1) Sony

2) Cannon

3) Nikon

4) Kodak

5) Samsung

Digital Camera

1) Sony

2) LG

3) Samsung

4) Sansui

5) AKAI

6) Panasonic

7) Hitachi

8) Haier

High Involvement and too many brands to choose from

27

IMTExamples of Buying behavior-Variety Seeking

Low involvement and too many brands to choose from

28

IMTExamples of Buying behavior-Habitual

29

IMTExamples of Buying behavior-Dissonance reducing .

High involvement and a few brands to choose from

30

IMT

30

Consumer Decision-Making Process

Post purchase Behavior Post purchase Behavior

Purchase Purchase

Evaluation of Alternatives Evaluation of Alternatives

Information Search Information Search

Need Recognition Need Recognition

Cultural, Social, Individual and Psychological Factors affect all steps

Cultural, Social, Individual and Psychological Factors affect all steps

31

IMT1) Need Recognition

Result of an imbalance

between actual and

desired states.

Result of an imbalance between actual and

desired states.

Internal StimuliandExternal Stimuli

Present Status

Preferred State

Marketing helps consumers recognize an imbalance between present status and preferred state. Go

Present State

Preferred state

32

IMTNEED IDENTIFICATION-Examples

Fully automatic washing machines from Godrej

33

IMT1) Need Recognition-Case of a John& purchase of laptop

I don’t have a laptop ,I must have one

My laptop seems to be out of date, I should

change.

There is a discount in International City this

is the time.

It is mandatory for all MBA students.

I want to play games and watch movies

34

IMT2) Information Search

Internal Information Search

Recall information in memory

External Information search

Seek information in outside environment

Non-marketing controlled Marketing controlled

Marketing should identify consumer source of information and importance of each source.

A company must design its marketing mix to make prospects aware of and knowledgeable about its brand. Go

35

IMTInformation Search

35

•Family, friends, neighbors•Most effective source of information

•Advertising, salespeople•Receives most information from these sources•Mass Media•Consumer-rating groups

•Handling the product•Examining the product•Using the product

Personal Sources Personal Sources

Commercial SourcesCommercial Sources

Public SourcesPublic Sources

Experiential SourcesExperiential Sources

36

IMT2) Search Information-Case of a John& purchase of laptop

Memory scan

Consult Friends& Family

Browse through the internet

May visit computer showrooms

Start paying more attention to Computer ads

in TV and Print media

37

IMT

Evoked Set

Purchase!

Evaluation of Products

Analyze product attributes

Use cutoff criteria

Rank attributes by importance

3) Evaluation of Alternatives

Marketing should talk about the adage of their product and the proposition that they are offering more than the competitor. Go

38

IMTCoca Cola- Compagain for Achieving TOMA

Coca-Cola didn't have many issues selling Coke during the summer months. To ensure that coke is selected as an alternative in the wintertime, come up with a campaign. "Thirst Knows No Season"

“Thanda matlab Coca Cola”

39

IMTJUST DO IT by Nike to carve niche in customer minds

"Just Do It" campaign, purportedly coined during a meeting of executives between WK and Nike ("You Nike guys, you just do it.").

Nike tied their brand to smart, humorous and cool advertising to evaluate

40

IMT Think Small –By Volkswagen talked about their uniqueness

Volkswagen had plenty of success with the Beetle in Europe, but wanted to bring it to the U.S.

The DDB team knew they had to do something different to win over the jaded consumers.

the impact of its ad campaigns revolutionized advertising forever,

41

IMTEvaluate the alternative (Introduce the X Factor)

• Product Feature• Price• Promotion• Service• Distribution

Marketers should introduce the X Factor to help consumers evaluate the alternatives. This X Factor can be in varied forms which can be:

42

IMTPRICE

43

IMTPRODUCT

Thinner cans appealed the youth- Style

X Factor -Glycerine

It’s a liquid soap

All Out with Extra MMR

44

IMTSERVICES

45

IMTPERFORMANCE

DABBAWALAS IN MUMBAI

46

IMT3) Evaluation of Alternatives-Case of a John& purchase of laptop

Expectancy value model

Consumer assigns different values for different attributes of a product

Conjunctive model

Consumer assigns a minimum cut-off value to each attribute.

Disjunctive model

Assign maximum weight age to one particular model

Attributes

Laptops Size Price Warranty Configuration

HP 8 9 6 9

DELL 7 7 7 7

SONY 10 4 3 2

Acer 5 3 8 5

Weight age 0.4 0.3 0.2 0.1

Minimum cut off

6 6 6 6

47

IMTDecision Making Sets

Total set Awareness set

Consideration set

Choice set Decision

APPLEDELLHPCOMPAQSONYACERTOSHIBABENQMSN

HPDELLSONYACERTOSHIBAAPPLE

HPDELLSONYACER

HPDELL

HP

48

IMT

Purchase IntentionDesire to buy the most preferred brand

Purchase Decision

Unexpected

Situational Factors

Attitudes of Others

Purchase Decision

Marketing should reduce the time gap between the purchase intent of consumer and the actual buying. GO

49

IMTPurchase Decision-case of John & laptop

Unexpected situational Behavior• John saw an ad that i7 second generation

processor is getting launched soon and he postponed his decision to buy laptop for time being

Attitude of others• John’s Father told to buy Dell as Dell’s service

is better .John was forced to buy Dell.

50

IMT5) Post purchase Behavior

Can minimize through:Effective CommunicationFollow-upGuaranteesWarranties. Go

Cognitive Dissonance

??Did I make a good decision?

Did I buy the right product?

Did I get a good value?

51

IMTPurchase Decision-case of John & laptop

Satisfied John John will tell good things about his laptop to his friends and relatives and this may influence them to buy the same laptop as John.John will also be attracted towards other offering the same company

Dissatisfied John Spread bad word of mouth May file a legal caseGo to media

52

IMT

Thanks For your time and

consideration