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Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5

1

Designed by Eric Brengle B-books, Ltd.

CHAPTER

5

Consumer Decision Making

Prepared byDeborah Baker

Texas Christian University

Introduction to MarketingMcDaniel, Lamb, Hair

9

2Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5

Learning Outcomes

Explain why marketing managers should understand consumer behavior

Analyze the components of the consumer decision-making process

Explain the consumer’s postpurchase evaluation process

LOI

LO2

LO3


Learning Outcomes

Identify the types of consumer buying decisions and discuss the significance of consumer involvement

Identify and understand the cultural factors that affect consumer buying decisions

Identify and understand the social factors that affect consumer buying decisions

LO5

LO6

LO4


Learning Outcomes

Identify and understand the individual factors that affect consumer buying decisions

Identify and understand the psychological factors that affect consumer buying decisions

LO8

LO7


Explain why marketing managers should understand

consumer behavior

The Importance of UnderstandingConsumer BehaviorLOI


LOI

ConsumerBehavior

ConsumerBehavior

Consumer Behavior

Processes a consumer uses to

make purchase decisions, as

well as to use and dispose of

purchased goods or services;

also includes factors that

influence purchase decisions

and the product use.


REVIEW LEARNING OUTCOMEUnderstanding Consumer Behavior

LOI

Consumer behavior

Consumer behavior

consumers make purchase decisionsconsumers make

purchase decisions

consumers use anddispose of product

consumers use anddispose of product

= HOW


Analyze the components of the

consumer decision-making process

The Consumer Decision-Making ProcessLO2


LO2

ConsumerDecision-Making

Process

ConsumerDecision-Making

Process

A five-step process used

by consumers when

buying goods or services.

Consumer Decision-Making Process


LO2 Consumer Decision-Making Process

Postpurchase Behavior


PurchasePurchase

Evaluation of Alternatives

Evaluation of Alternatives

Information SearchInformation Search

Need RecognitionNeed Recognition

Cultural, Social, Cultural, Social, Individual and Individual and Psychological Psychological

Factors Factors affect affect

all stepsall steps

Cultural, Social, Cultural, Social, Individual and Individual and Psychological Psychological

Factors Factors affect affect

all stepsall steps


LO2

NeedRecognition

NeedRecognition

Result of an imbalance between

actual and desired states.

Need Recognition

12Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved

Chapter 5

LO2 Need Recognition

Marketing helps consumers recognize an imbalance between

present status and preferred state.

Present Status

Present Status

Preferred State

Preferred State

InternalStimuli

External

Stimuli


LO2

StimulusStimulus Any unit of input affecting

one or more of the

five senses:

Stimulus

sightsmelltastetouch

hearing


LO2 Recognition of Unfulfilled Wants

When a current product isn’t performing properly

When the consumer is running out of a product

When another product seems superior to the one currently used


LO2 Information Search

Internal Information Search

Recall information in memory

External Information search

Seek information in outside environment Nonmarketing controlled Marketing controlled


LO2 External Information Searches

Need MoreNeed More Information Information

More Risk Less knowledge

Less product experienceHigh level of interestLack of confidence

Less Risk More knowledge

More product experienceLow level of interest

Confidence in decision

Need LessNeed Less Information Information


LO2 Evoked Set

Evoked SetEvoked Set Group of brands, resulting

from an information search,

from which a buyer can

choose.


LO2 Evaluation of Alternativesand Purchase

Evoked SetEvoked Set

Purchase!Purchase!

Analyze product attributesAnalyze product attributes

Rank attributes byimportance

Rank attributes byimportance

Use cutoff criteriaUse cutoff criteria

19Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5 LO2

Purchase

To buy To buy or not to buy...or not to buy...

Determines which attributes Determines which attributes are most important are most important

in influencing a in influencing a consumer’s choiceconsumer’s choice


REVIEW LEARNING OUTCOMEConsumer Decision-Making Process

LO2C

UL

TU

RA

L SO

CIA

L

PSYCHOLOGICAL

INDIVIDUAL

Need Recognition

1 InformationSearch

2 EvaluateAlternatives

3 Purchase 4


Explain the consumer’s postpurchase evaluation

process

Postpurchase BehaviorLO3


LO3 Cognitive Dissonance

CognitiveDissonance

CognitiveDissonance

Inner tension that a

consumer experiences after

recognizing an

inconsistency between

behavior and values or

opinions.

23Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5 LO3


Consumers can reduce dissonance by:

Seeking information that reinforces positive ideas about the purchase

Avoiding information that contradicts the purchase decision

Revoking the original decision by returning the product

Marketing can minimize through:Effective Communication

Follow-upGuaranteesWarranties


Identify the types of consumer buying decisions and a

discuss the significance aof consumer involvement

Consumer Buying Decisions andConsumer InvolvementLO4


LO4 Consumer Buying Decisions andConsumer Involvement

More Involvement

LessInvolvement

RoutineResponseBehavior

RoutineResponseBehavior

LimitedDecisionMaking

LimitedDecisionMaking

ExtensiveDecisionMaking

ExtensiveDecisionMaking


LO4Five Factors Influencing Decisions

1. Level of consumer involvement1. Level of consumer involvement

2. Length of time to make decision2. Length of time to make decision

3. Cost of good or service3. Cost of good or service

4. Degree of information search4. Degree of information search

5. Number of alternatives considered5. Number of alternatives considered


LO4 Continuum of Consumer Buying Decisions


LO4 Routine Response Behavior

Little involvement in selection process

Frequently purchased low cost goods

May stick with one brand

Buy first/evaluate later

Quick decision


LO4 Limited Decision Making

Low levels of involvement

Low to moderate cost goods

Evaluation of a few alternative brands

Short to moderate time to decide


LO4 Extensive Decision Making

High levels of involvement

High cost goods

Evaluation of many brands

Long time to decide

May experience cognitive dissonance


LO4 Factors Determining the Level of Consumer Involvement

SituationSituation

Social VisibilitySocial Visibility

InterestInterest

Perceived Risk of Negative Consequences

Perceived Risk of Negative Consequences

Previous ExperiencePrevious Experience


LO4 Marketing Implications of Involvement

High-involvement purchases require:High-involvement purchases require:

Extensive and informative promotion to target market

Extensive and informative promotion to target market

Low-involvement purchases require:Low-involvement

purchases require:

In-store promotion, eye-catching package design, and good displays.Coupons, cents-off,2-for-1 offers

In-store promotion, eye-catching package design, and good displays.Coupons, cents-off,2-for-1 offers


REVIEW LEARNING OUTCOME Consumer Buying Decisions and Consumer Involvement

LO4

RoutineRoutine

LimitedLimited

ExtensiveExtensive

Previous experienceInterestPerceived risk of negative consequencesSituationSocial visibility


Identify and understand the cultural factors

that affect consumer buying decisions

Cultural Influences on Consumer Buying DecisionsLO5


LO5 Factors Influencing Buying Decisions

Social Factors

Individual Factors

Psycho-logical Factors

Cultural Factors

CONSUMERDECISION-

MAKINGPROCESS

BUY /

DON’T BUY


LO5 Culture

CultureCulture

Set of values, norms,

attitudes, and other

meaningful symbols that

shape human behavior and

the artifacts, or products, of

that behavior as they are

transmitted from one

generation to the next.


LO5 Components of Culture

MythsMyths

LanguageLanguage

ValuesValues

CustomsCustoms

RitualsRituals

LawsLaws

Material artifactsMaterial artifacts


LO5 Culture is. . .

LearnedLearned

FunctionalFunctional

PervasivePervasive

DynamicDynamic


ValueLO5

ValueValueEnduring belief that a specific

mode of conduct is personally or

socially preferable to another

mode of conduct.


LO5 Core American Values

SuccessSuccess

MaterialismMaterialism

FreedomFreedom

ProgressProgress

YouthYouth

CapitalismCapitalism http://www.thesource.com

Online


SubcultureLO5

SubcultureSubcultureA homogeneous group

of people who share elements of

the overall culture as well as unique

elements of their own group.

http://www.dead.net

Online


LO5 Social Class

Social ClassSocial Class

A group of people in a society who are

considered nearly equal in status or

community esteem, who regularly socialize

among themselves both formally and

informally, and who share behavioral norms.


LO5 Social Class Measurements

WealthWealth

Other VariablesOther Variables

IncomeIncome

EducationEducation

OccupationOccupation


LO5 Social Class and Education


LO5 The Impact of Social Class on Marketing

1. Indicates which medium to use for advertising

2. Helps determine the best distribution for products


REVIEW LEARNING OUTCOME Cultural Factors

LO5


Identify and understand the social factors that affect consumer buying decisions

Social Influences on Consumer Buying DecisionsLO6


LO6 Social Influences

Reference Groups

Reference Groups

Opinion LeadersOpinion Leaders

Family MembersFamily

Members


LO6 Reference Group

Reference GroupReference Group A group in society that

influences an individual’s

purchasing behavior.


LO6 Reference Groups

Reference Groups

Direct

Indirect

Primary

Secondary

Aspirational

Nonaspirational


LO6 Influences of Reference Groups

1. They serve as information sources and influence perceptions.

2. They affect an individual’s aspiration levels.

3. Their norms either constrain or stimulate consumer behavior.


LO6

Opinion LeadersOpinion Leaders

Opinion Leaders

An individual who influences

the opinion of others.

53Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5LO6

Teenagers Movie stars Sports figures Celebrities

Marketers are looking to Web logs,

or blogs, to find opinion leaders

Opinion Leaders

54Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5LO6

Initiators

Influencers

Decision Makers

Purchasers

Consumers

Purchase Process Roles in the Family

Family


LO6Relationships among Purchasers

and Consumers in the Family


REVIEW LEARNING OUTCOME Social Factors

LO6

Direct IndirectReferenceGroups Primary Secondary Aspirational Nonaspirational

OpinionLeaders

Peopleyou know

Socialization Process

Family

Celebrities

Initiators Decision Makers Consumers

Influencers Purchasers


Identify and understand the individual factors


Individual Influences onConsumer Buying DecisionsLO7


LO7 Individual Influences

GenderGender Age Life Cycle

Age Life Cycle

PersonalitySelf-Concept

Lifestyle

PersonalitySelf-Concept

Lifestyle


Identify and understand the psychological factors


Psychological Influences onConsumer Buying DecisionsLO8

Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5 60

LO8

Psychological Influences

PerceptionPerception

MotivationMotivation

LearningLearning

Beliefs & AttitudesBeliefs & Attitudes


LO8 Perception

PerceptionPerception Process by which people select,

organize, and interpret stimuli

into a meaningful and coherent

picture.

Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 5 62

LO8

Perception

SelectiveSelectiveExposureExposureSelectiveSelectiveExposureExposure

SelectiveSelectiveDistortionDistortionSelectiveSelectiveDistortionDistortion

SelectiveSelectiveRetentionRetention SelectiveSelective

RetentionRetention


LO8

Selective ExposureSelective Exposure

SelectiveDistortionSelectiveDistortion

Selective RetentionSelective Retention

Consumer notices certain stimuli and ignores others

Consumer notices certain stimuli and ignores others

Consumer changes or distorts information that conflicts

with feelings or beliefs

Consumer changes or distorts information that conflicts

with feelings or beliefs

Consumer remembers only that information that

supports personal beliefs

Consumer remembers only that information that

supports personal beliefs

Perception


LO8Marketing Implications of

Perception

Important attributes

Price

Brand names

Quality and reliability

Threshold level of perception

Product or repositioning changes

Foreign consumer perception


LO8 Motivation

Maslow’s Hierarchyof Needs

Maslow’s Hierarchyof Needs

A method of classifying human

needs and motivations into five

categories in ascending order of

importance.


LO8 Maslow’s Hierarchy of Needs


LO8 Types of Learning

ExperientialExperiential

ConceptualConceptual

An experience changes behavior

An experience changes behavior

Not learned through direct experience

Not learned through direct experience

http://www.cspinet.org

Online


LO8Stimulus Generation and Discrimination

Stimulus Generalization

Stimulus Generalization

A form of learning that occurs when one response is extended to a second stimulus similar to the first.

A form of learning that occurs when one response is extended to a second stimulus similar to the first.

StimulusDiscrimination

StimulusDiscrimination

A learned ability to differentiate among similar products.

A learned ability to differentiate among similar products.


LO8

BeliefBelief

AttitudeAttitude

An organized pattern of

knowledge that an individual

holds as true about his or her

world.

A learned tendency to

respond consistently toward a

given object.

Beliefs and Attitudes


LO8 Changing Attitudes

Change beliefs about the brand’s attributes

Change the relative importance of these beliefs

Add new beliefs


REVIEW LEARNING OUTCOMELO8

Psychological Factors

LearningStimulus

GeneralizationStimulus

Discrimination

Selective ExposurePerception

Selective Retention Selective Exposure

NeedsMotivation

Psychological EsteemSafety Social Esteem

Beliefs &Attitudes

ChangingBeliefs about

Attributes

ChangingImportance of

Beliefs

AddingNew Beliefs

ch05 print

Entertainment & Humor

consumer behavior consumers

consumer experiences

consumer isrunning

continuum of consumer

level of consumer involvement

purchase decisions consumers

degree of information

product use