3 Chapter Three Overview of Buying Process Understanding Consumer Behavior Cultural Influences Understanding Cultural Impact Social Classes Reference Groups.

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Chapter Three

Overview of Buying Process

Understanding Consumer Behavior

Cultural Influences

Understanding Cultural Impact

Social Classes

Reference Groups and Families

Decision Influences

Situational Influences

Psychological Influences

Decision Making Styles

Decision Making Process

Maslow on Needs

Data Sources

Alternative Evaluation

Purchasing

The Authors

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Consumer Behavior

C H A P T E R T H R E E

MarketingManagement

J. Paul Peter

James H. Donnelly, Jr.

7th Edition

SECTION 1

MarketingManagement

J. Paul Peter

James H. Donnelly, Jr.

7th Edition

SECTION 1

3

Overview of the Buying Process

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SOCIALINFLUENCES

MARKETINGINFLUENCES

SITUATIONALINFLUENCES

PSYCHOLOGICALINFLUENCES

CONSUMER DECISION MAKING

FIGURE 3-1

Chapter Three

Overview of Buying Process

Understanding Consumer Behavior

Cultural Influences

Understanding Cultural Impact

Social Classes

Reference Groups and Families

Decision Influences

Situational Influences

Psychological Influences

Decision Making Styles

Decision Making Process

Maslow on Needs

Data Sources

Alternative Evaluation

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Understanding Consumer Behavior

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An understanding of consumers and their needs and purchasing behavior shapes successful marketing.

No single theory of consumer behavior can totally explain why consumers behave the way they do.

Chapter Three

Overview of Buying Process

Understanding Consumer Behavior

Cultural Influences

Understanding Cultural Impact

Social Classes

Reference Groups and Families

Decision Influences

Situational Influences

Psychological Influences

Decision Making Styles

Decision Making Process

Maslow on Needs

Data Sources

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Cultural InfluencesOn Consumer Behavior

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Achievement and success activity – Hard work is good, natural and healthy; leads to success

Efficiency and practicality – Admiration for things that solve problems; solving problems is good

Material comfort – “The good life”

Individualism – Self-reliance, self-interest

Chapter Three

Overview of Buying Process

Understanding Consumer Behavior

Cultural Influences

Understanding Cultural Impact

Social Classes

Reference Groups and Families

Decision Influences

Situational Influences

Psychological Influences

Decision Making Styles

Decision Making Process

Maslow on Needs

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Cultural InfluencesOn Consumer Behavior

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Freedom – Freedom of choice

External conformity – Desire for acceptance

Humanitarianism – Caring for others—doing good

Youthfulness – Young at heart, especially in appearance and style

Fitness and health – Caring about one’s body and continuing wellness

Chapter Three

Overview of Buying Process

Understanding Consumer Behavior

Cultural Influences

Understanding Cultural Impact

Social Classes

Reference Groups and Families

Decision Influences

Situational Influences

Psychological Influences

Decision Making Styles

Decision Making Process

Maslow on Needs

Data Sources

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Understanding Cultural ImpactOn Consumer Behavior

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• The family, religious organizations and educational institutions transmit cultural values

• Educational institutions are playing an ever-growing role

• Many sub cultural barriers are decreasing because of mass communication, mass transit, and decline of the influence of religious values

Chapter Three

Overview of Buying Process

Understanding Consumer Behavior

Cultural Influences

Understanding Cultural Impact

Social Classes

Reference Groups and Families

Decision Influences

Situational Influences

Psychological Influences

Decision Making Styles

Decision Making Process

Maslow on Needs

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Social Classes

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Upper Americans • 14% of the population

• High income – high quality, high prestige brands

Middle Class • 34% of the population

• Concerned with following media recommendations and what peers say is popular

Chapter Three

Overview of Buying Process

Understanding Consumer Behavior

Cultural Influences

Understanding Cultural Impact

Social Classes

Reference Groups and Families

Decision Influences

Situational Influences

Psychological Influences

Decision Making Styles

Decision Making Process

Maslow on Needs

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Social Classes

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Working Class • 38% of the population

• “Family folk” – depend upon relatives for financial and emotional support

Lower Americans • 16% of the population

• Very diversified, from frugality to instant gratification

Chapter Three

Overview of Buying Process

Understanding Consumer Behavior

Cultural Influences

Understanding Cultural Impact

Social Classes

Reference Groups and Families

Decision Influences

Situational Influences

Psychological Influences

Decision Making Styles

Decision Making Process

Maslow on Needs

Data Sources

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Reference Groups and Families

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Primary reference groups include family and close friends while secondary reference groups include fraternal and professional organizations

The family constitutes an important reference group. It has been suggested that the home, rather than an individual, defines consumer behavior because the purchase may serve multiple users of these goods and services.

Chapter Three

Overview of Buying Process

Understanding Consumer Behavior

Cultural Influences

Understanding Cultural Impact

Social Classes

Reference Groups and Families

Decision Influences

Situational Influences

Psychological Influences

Decision Making Styles

Decision Making Process

Maslow on Needs

Data Sources

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Decision Influences

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PRODUCT INFLUENCES

As a key task, marketers differentiate their products from their competitors and create the perception of a worthwhile product purchase.

PRICE INFLUENCES

Today’s value-conscious consumers may buy products more on the basis of price than other attributes.

Chapter Three

Overview of Buying Process

Understanding Consumer Behavior

Cultural Influences

Understanding Cultural Impact

Social Classes

Reference Groups and Families

Decision Influences

Situational Influences

Psychological Influences

Decision Making Styles

Decision Making Process

Maslow on Needs

Data Sources

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Decision Influences

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PROMOTION INFLUENCES

Marketing communications plays a critical role in informing consumers about products and services.

PLACE INFLUENCES

Convenience increases the probability of consumers finding and buying certain products.

Chapter Three

Overview of Buying Process

Understanding Consumer Behavior

Cultural Influences

Understanding Cultural Impact

Social Classes

Reference Groups and Families

Decision Influences

Situational Influences

Psychological Influences

Decision Making Styles

Decision Making Process

Maslow on Needs

Data Sources

Alternative Evaluation

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Situational Influences

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Physical features are the most readily apparent features of a situation.

Social features provide additional depth to a description of a situation.

Time is a dimension of situations that may be specified in units ranging from time of day to season of year.

Task features include intent or requirement to select, shop for, or obtain information about a purchase.

Current conditions are things like momentary moods rather than chronic individual traits

Chapter Three

Overview of Buying Process

Understanding Consumer Behavior

Cultural Influences

Understanding Cultural Impact

Social Classes

Reference Groups and Families

Decision Influences

Situational Influences

Psychological Influences

Decision Making Styles

Decision Making Process

Maslow on Needs

Data Sources

Alternative Evaluation

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Psychological Influences

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Product knowledge refers to the amount of information a consumer has stored in his or her memory about product classes, brands, models and ways to purchase them.

Product involvement refers to a consumer’s perception of the importance or personal relevance of an item.

Chapter Three

Overview of Buying Process

Understanding Consumer Behavior

Cultural Influences

Understanding Cultural Impact

Social Classes

Reference Groups and Families

Decision Influences

Situational Influences

Psychological Influences

Decision Making Styles

Decision Making Process

Maslow on Needs

Data Sources

Alternative Evaluation

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Decision Making Styles

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Extensive decision making (or Extensive Problem Solving)

> Requires high degrees of time and effort because the purchase is complex, high priced or has high importance to the consumer

Limited decision making (or Limited Problem Solving)

> Less time and effort but still may involve trips to several stores to compare brands and and styles

Routine decision making (or Routine Problem Solving)

> The most common way people purchase most packaged goods. Products are simple, inexpensive and familiar

Chapter Three

Overview of Buying Process

Understanding Consumer Behavior

Cultural Influences

Understanding Cultural Impact

Social Classes

Reference Groups and Families

Decision Influences

Situational Influences

Psychological Influences

Decision Making Styles

Decision Making Process

Maslow on Needs

Data Sources

Alternative Evaluation

Purchasing

The Authors

SECTION 1

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Decision Making Process

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NEED RECOGNITION

ALTERNATIVE EVALUATION

ALTERNATIVE SEARCH

PURCHASE DECISION

POSTPURCHASE EVALUATION

Chapter Three

Overview of Buying Process

Understanding Consumer Behavior

Cultural Influences

Understanding Cultural Impact

Social Classes

Reference Groups and Families

Decision Influences

Situational Influences

Psychological Influences

Decision Making Styles

Decision Making Process

Maslow on Needs

Data Sources

Alternative Evaluation

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Maslow on Needs

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Maslow’s Hierarchy of Needs

Self-actualization – to actualize all that a person can become

Esteem needs – self-aware and important to others

Belongingness – need for companionship

Safety Needs – protection from harm, ill health, et al

Physiological Needs – survival needs of all humans

Chapter Three

Overview of Buying Process

Understanding Consumer Behavior

Cultural Influences

Understanding Cultural Impact

Social Classes

Reference Groups and Families

Decision Influences

Situational Influences

Psychological Influences

Decision Making Styles

Decision Making Process

Maslow on Needs

Data Sources

Alternative Evaluation

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Data Sources

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Internal sources – Comes from experience

Group sources – Communication from other people

Marketing sources – Advertising, sales people, packaging

Public sources – Publicity from article, independent ratings

Experiential sources – Handling, examining and trying the actual product

Chapter Three

Overview of Buying Process

Understanding Consumer Behavior

Cultural Influences

Understanding Cultural Impact

Social Classes

Reference Groups and Families

Decision Influences

Situational Influences

Psychological Influences

Decision Making Styles

Decision Making Process

Maslow on Needs

Data Sources

Alternative Evaluation

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Alternative Evaluation

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A Process:

• Consumer completes information gathering

• Consumer identifies alternative(s)

• Differences in alternative characteristics identified

• Alternative’s characteristics compared to the characteristics deemed most needed and relevant

• The favored brand generally offers the most desirable attributes

• The consumer buys the alternative with the greatest number of desired characteristics

Chapter Three

Overview of Buying Process

Understanding Consumer Behavior

Cultural Influences

Understanding Cultural Impact

Social Classes

Reference Groups and Families

Decision Influences

Situational Influences

Psychological Influences

Decision Making Styles

Decision Making Process

Maslow on Needs

Data Sources

Alternative Evaluation

Purchasing

The Authors

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Purchasing

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Traditional risk theorists believe that consumers tend to make risk minimizing decisions based on their perception of risk associated with a particular purchase.

Consumers generally try to reduce their risk by reducing negative consequences or by reducing perceived uncertainty.

Chapter Three

Overview of Buying Process

Understanding Consumer Behavior

Cultural Influences

Understanding Cultural Impact

Social Classes

Reference Groups and Families

Decision Influences

Situational Influences

Psychological Influences

Decision Making Styles

Decision Making Process

Maslow on Needs

Data Sources

Alternative Evaluation

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Post-purchase Evaluation

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Cognitive Dissonance:

> Inconsistency or disharmony with attitudes and beliefs

Anxiety over decisions occur when:

> The decision carries importance financially, psychologically, or both.

> The alternatives appear plentiful

> The forgone alternatives display many favorable features

Chapter Three

Overview of Buying Process

Understanding Consumer Behavior

Cultural Influences

Understanding Cultural Impact

Social Classes

Reference Groups and Families

Decision Influences

Situational Influences

Psychological Influences

Decision Making Styles

Decision Making Process

Maslow on Needs

Data Sources

Alternative Evaluation

Purchasing

The Authors

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The AuthorsJ. Paul Peter, Ph.D.University of Wisconsin – Madison

James H. Donnelly, Jr., Ph.D.University of Kentucky – Lexington

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Keller Graduate School of Management of DeVry University

Marketing Management7th Edition – McGraw-Hill

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Chapter Three

Overview of Buying Process

Understanding Consumer Behavior

Cultural Influences

Understanding Cultural Impact

Social Classes

Reference Groups and Families

Decision Influences

Situational Influences

Psychological Influences

Decision Making Styles

Decision Making Process

Maslow on Needs

Data Sources

Alternative Evaluation

Purchasing

The Authors

SECTION 1