MKT 301 Consumer Behavior

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4
Chapter
Consumer Markets and Buying Behavior
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Objectives

• Differentiate between needs and wants
• Understand the process of consumer decision
  making
• Comprehend motivation theory
• Importance of understanding consumer
  post-purchase behavior

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Ultimate consumers who buy goods and services
for their own personal or household use.
The CONSUMER MARKET
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Needs vs. Wants(Typical Textbook Def.)

• Needs
• Unsatisfactory conditions of the consumer that
  lead him or her to actions that will make the
  conditions better
• Wants
• Desires to obtain more satisfaction than is
  absolutely necessary to improve unsatisfactory
  conditions

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Various Needs Theories/Systems

• Maslows Hierarchy of Needs
• Still Most Popular / Widely Used

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MaslowsHierarchyof Needs
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Safe-T-Man
Safety Appeal toward Women...
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Safety Appeal toward Children...
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MARKETERS ANALYZE COMPONENTS OF THE CONSUMER
DECISION-MAKING PROCESS TO BETTER UNDERSTAND /
PREDICT BEHAVIOR.

• Generally, consumers go through these stages in
  order when purchasing products/services
• The Consumer Decision-Making Process has 5 major
  Stages

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The Consumer Decision-Making Process
Need Recognition
Identification of Alternatives
Individual and Social Factors
Evaluation of Alternatives
Purchase
Postpurchase Behavior
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STAGE 1 - NEED RECOGNITION, CREATES TENSION OR
DISCOMFORT IN THE CONSUMER.

• A need may arise internally or externally.
• Physiological (Im hungry)
• External (Hey, thats a sharp looking car!)
• Dissatisfaction with a product can stimulate a
  need.
• Black stove/microwave
• Problem/Need recognition is typically triggered
  by a stimulus which must be PERCEIVED

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PERCEPTION THE PROCESS OF RECEIVING, ORGANIZING,
AND ASSIGNING MEANING TO STIMULI DETECTED BY THE
SENSES. A PROCESS OF SELECTIVITY AFFECTS
PERCEPTION.

• Selective exposure only those stimuli that
  capture and hold attention can be perceived.
• Selective distortion consumers alter information
  that is inconsistent with their beliefs and
  attitudes.
• Selective retention consumers retain only part
  of what they perceive.

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The F Test
Count the number of Fs in the following sentence
FINISHED FILES ARE THE RESULT OF YEARS OF
SCIENTIFIC STUDY COMBINED WITH THE EXPERIENCE OF
MANY YEARS.
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• Stimulus Discrimination vs.

Stimulus Generalization
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Interpretation Meaning consumer attaches to a
stimulus

• NAMES
• Signal Power /Quality (Toro Snow Pup/Master)
• Cars Mustang / Barracuda / Viper
• Donkey / Weasel?
• NUMBERS
• 350 Z / WD-40 / Acura CL?
• COLORS
• Different for different cultures

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Interpretation Meaning consumer attaches to a
stimulus

• COLOR
• Signal Newness or Quality (Black Label)
• Signal Product Contents (Sodas)

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STAGE 2 - IDENTIFICATION OF ALTERNATIVES IS
INFLUENCED BY

• EVOKED SET
• Group of brands that come to mind around time of
  purchase
• CONSIDERATION SET
• Group of brands a consumer will consider buying
• Car Tire Brands?
• Typically 3-5 Brands in Consideration Set

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INFORMATION SOURCE INFLUENCES PURCHASE DECISIONS

• There are two primary sources of information
• Marketer-controlled information source
• All information that originates from marketers
  designed to influence consumers
• Non-Marketer-controlled information source
• Information relating to products/services that
  does not originate from marketers
• Social Environment much more influential,
  especially in product/service Failure situations
• Opinion Leaders Important
• Richs runners group example...

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LEARNING CHANGES IN BEHAVIOR THAT RESULT FROM
OBSERVATION OR EXPERIENCE.

• Responses to stimuli are learned as a result of
  rewards or punishments.
• Responses can become habits that replace willful
  behavior.
• Learning is Behavioral and/or Cognitive

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STAGE 3 - EVALUATION OF ALTERNATIVES, INCLUDING
ESTABLISHING CRITERIA WITH WHICH TO MAKE THE
EVALUATION.

• Can be a single criterion or multiple criteria.
• Multiple criteria typically are not equally
  weighted in a decision.
• Compensatory vs. Non-Compensatory Decision-Making
  Models

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Compensatory vs. Non-Compensatory Decision-Making
Models

• Compensatory Strong attributes can compensate
  for Weak ones.
• (These shoes are ugly, but theyre cheap, and
  they are extremely comfortable)
• Non-Compensatory Attributes dont compensate for
  each other. Select or dismiss based on key
  attribute or lack thereof.
• (Many different types of NC Models)

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SITUATIONAL INFLUENCES ARE TEMPORARY FORCES
ASSOCIATED WITH THE IMMEDIATE PURCHASE
ENVIRONMENT THAT AFFECT BEHAVIOR.

• When consumers buy the time dimension.
• Where consumers buy the physical surroundings.
• How consumers buy the terms of the purchase.
• Conditions under which consumers buy states and
  moods.

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STAGE 5 - POSTPURCHASE BEHAVIOR, WHICH INFLUENCES
REPEAT SALES AND WHAT BUYERS TELL OTHER
CONSUMERS.

• Cognitive Dissonance may occur because each of
  the alternatives considered has advantages and
  disadvantages.
• Cog. Diss. increases with
• The importance of the purchase.
• The degree of similarity between the item
  selected and the items rejected.
• Marketers can help reduce Cog. Diss. by
• Reassuring buyers through ads and personal
  communications.
• Providing quality post-sale service.

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IMPULSE BUYING

• Impulse buying, a common low-involvement
  decision, is a purchase made with little or no
  advance planning.
• For many types of products/services, the majority
  of purchases are made on impulse
• New and Improved
• EXTREMELY IMPORTANT
• Info. Must be in consumers head already
• Name that jingle

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DissatisfactionComplaintNWOM
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Complaint Behavior and NWOM

• The number of unsatisfactory incidents FAR
  OUTWEIGHS the number of actual complaints
• Why is this???

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Complaint Behavior

• Research indicates that there is a greater
  likelihood of consumer complaint when
• 1) The consumer is a member of a more upscale
  Socioeconomic group
• 2) The dissatisfaction is more severe
• 3) The consumer places the blame for the
  DISSAT on the marketer (rather than self)
• 4) The consumer perceives that the marketer
  will be responsive to the complaint

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Negative Word-of-Mouth

• Consumer is much more likely to engage in NWOM
  rather than direct complaint
• At least 3 reasons for NWOM
• 1) To make his/herself feel better (catharsis)
• 2) To warn other consumers of bad experience
• 3) To punish the offending marketer

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Research on NWOM shows that

• Consumers tend to place more weight on (-)
  information when making evaluations than on ()
  information
• Consumer will tell (on average) 8 or more about
  their Dissatisfaction
• However, Information Tech. is raising the stakes
  (Why not to buy a Honda)

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Complaint and Repurchase Intentions

• Consumers whose complaints are handled
  satisfactorily report extremely high repurchase
  intentions
• Consumers whose complaints are not handled
  satisfactorily report higher repurchase
  intentions than those that did not complain

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Marketing Implications

• Encourage (legitimate) complaint behavior
• Toll-Free Hotlines
• Stress Satisfaction Guarantees
• Address complaints promptly
• or else they will engage in NWOM...
• Be extremely careful about linking employee/store
  performance or rewards to number of customer
  complaints