consumer buyer behavior
DESCRIPTION
consumer buyer behavior by Mahajan samantTRANSCRIPT
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Consumer Behaviour
Consumer Decision Making
Individual Consumer
Environmental Influences
Organisational Buyer Behaviour
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Consumer Action Determines Sales
Now, marketing managers are convinced about…
1) Delivering product benefits
2) Changing brand attitudes
3) Influencing consumer perceptions
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Satisfaction of Consumer Needs
1) Defining consumer needs
2) Identify the segment of consumers that have these needs
3) Positioning new products or repositioning existing products to meet these needs
4) Developing marketing strategies to ensure the communication & delivery of product benefits
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HISTORICAL
PERSPECTIVE
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Marketing Strategies must be Based on…
Defined Consumer Needs Marketing Concept
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Development of the Marketing Concept
- Formulated in the early 1950s
- Mass Production and Mass Marketing
- Behavioral Research in the infancy
- Emphasis on ‘Economies of Scale’
- No economic necessity due to less purchasing power
- End of Korean war in 1953 changed the Sales Oriented Focus
- Marketers talk Behavioural terms
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Implications for Consumer Behaviour
1) Providing Spur to Behavioural Research
2) Creating more Customer Oriented framework for Marketing Strategies
3) Encouraging measurement of the factors that influence consumers to purchase
4) Emphasising Market Segmentation
5) Emphasising positioning to meet consumer needs
6) Creating greater selectivity in advertising and personal selling
7) Creating more selective media and distributive outlets
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Strategic Applications
1) Identifying new opportunities in the
marketplace
2) Evaluating the strengths and weaknesses
of the existing brand offerings
Two
Important
Tasks
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So That…
A 1: Define and segment the market
A 2: Plan marketing strategies
A 3: Evaluate marketing strategies
A 4: Assess future consumer behaviour
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A simple model of Consumer Behaviour
The IndividualConsumer
EnvironmentalInfluences
Applications of ConsumerBehaviour to
Marketing Strategies
ConsumerDecision Making
ConsumerResponse
Feedback to ConsumerPostpurchase evaluation
Feedback to MarketerDevelopment of Marketing Strategies
1.
2.
3.
4.
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Consumer Decision Making
Complex Decision Making
(Autos, Major Appliances)
Variety seeking(Cereals)
Inertia(canned Vegetables,
Paper Towels)
Brand Loyalty(Cigarettes, Perfumes)
High InvolvementPurchase Decision
Habit(Little or no InformationSearch, consideration ofonly one brand)
Low InvolvementPurchase Decision
Decision Making(Information Search,consideration ofbrand alternatives)
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Complex Decision Making
Involves…
1) Active information search
2) Evaluating alternative brands
3) Evaluation of brand purchased
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Importance of a Consumer Model
1) Encourages a total and integrative view
2) Helps identify means of information necessary
3) Encourages quantification of these variables
4) Provides a basis for segmenting markets
5) Provides a basis for developing strategies
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Limitations
1) Identifies only the most common elements
2) Components of the model may not be equally important for all product categories and…
3) for all usage situations
4) Will vary among individuals in the same market
5) All purchase decisions are not equally complex
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A Model of Complex Decision Making
For…
1) High priced goods
2) Products associated with high performance risks
3) Complex products (Stereo set, Home Computers)
4) Speciality goods (Sports Equipment, furniture)
5) Ego association (Clothing, Cosmetics)
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NeedArousal
PurchasePostpurchaseEvaluation
ConsumerInformationProcessing
BrandEvaluation
A Model of Complex Decision Making
Feedback
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Input Variables
NeedRecognition
(Initiation ofdecision making)
Consumer’sPsychological
Set
StimulusExposure
A - Need Arousal
INTERNAL
1. Consumer’s Past Experience 2. Consumer Characteristics• Demographics• Life-style• Personality
3. Consumer Motivation
EXTERNAL
Environmental Influences• face-to-face groups• situational determinants• social class• culture
Marketing Stimuli• Product• Price• Promotion• Store• Merchandising
Tension State
Need Criteria
Brand Attitudes
• Beliefs about the Brand
• Brand likes / dislikes
• Tendency to act
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Input Variables - Internal
1) Consumer’s Past Experience (Economy, Service, etc.)
2) Consumer Characteristics
3) Consumer Motives (Maslow)• Physiological (Food, Water)• Safety (Security, stability)• Social (affection, Acceptance)• Ego (Prestige, esteem, success)• Actualisation (Self-fulfillment)
• Demographic• Life-style• Personality
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Input Variables - External
4) Environmental Influences
5) Marketing Stimuli• Product• Price• Promotion• Store• Merchandising
• Face-to-face• Situation• Social class• Culture
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Consumer’s Psychological Set
1) Need Criteria and…
2) Brand Attitudes
Made up of two components viz.
Function of…Cognitive i. Beliefs about the brandAffective ii. Evaluation of brandsConative iii. Tendency to act
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Stimulus Exposure
1) Reinforce existing brand attitudes and perceptions
2) Search additional information
is a selective process that is directed by the need to…
&
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Need Recognition
When the need is recognised…
…the state of tension occurs
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Input Variables
NeedRecognition
Consumer’sPsychological
Set
StimulusExposure
B - Consumer Information Processing
Selectivity
Perceptionof Stimuli
Attention
Comprehension
Retention
Memory• Past Information• New Information
Search forAdditional
Information
Involves
1. Exposure to information
2. Organisation of information
3. Search for information
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Perception of stimuli
More likely when…
1) Confirms to consumer’s past experiences
2) Confirms to consumer’s current beliefs about a brand
3) are not too complex
4) are believable
5) Relate to a set of current needs
6) Do not produce excessive fears & anxieties
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Memory
Information that is retained
is stored in the consumer’s
Memory!
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Search for Additional Information
Most likely when…
1) Feels that alternative brands being considered are inadequate
2) Has insufficient information about the brands under consideration
3) Receives information from friends or media sources that conflicts with current information/beliefs and past experiences
4) Is close to deciding on a particular brand and would like to confirm expectations about performance
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Perceptionof Stimuli
Changes inConsumer’s
Psychological Set
NeedAssociation
C - Brand Evaluation
ExpectedSatisfaction
Define needs,Establish prioritiesof needs
• Compensatory decision rules
• Noncompensatory decision rules
Changes in Need Criteria
Changes in brand attitudes
Arrive at expectedsatisfaction for eachbrand based on needassociation
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Changes in Consumer’s Psychological Set
1) Changes in need criteria used to evaluate brands
2) Changes in beliefs about the brands – Cognitive
3) Changes in brand evaluation – Affective
4) Changes in tendency to act – Conative
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Need Association
A: A compensatory model for Brand Evaluation
B: A noncompensatory model for evaluation
Develop a priority of needs and relate a brand’s characteristicsto these needs
&
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Compensatory model for evaluation
Consumers do
Define their needs & order them by importance along with goal object
2) Determine the brands under consideration
3) Determine degree to which brands satisfy the needs
4) Select brand that will best meet the more important needs
1)
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ContributionTo expectedsatisfaction
Importanceof need
Need Criteria Goal Object Make /Brand
Evaluationof Brand
Economy 10 Service Cost C1 4 40
C2 8 80
Gas Mileage C1 2 20
C2 8 80
Service 8 Speed C1 8 64
Dependability C2 8 64
& Quality C1 8 64
of Repairs C2 7 56
Performance 8 Smooth ride C1 10 80
Economy C2 8 64
Pick Up C1 10 80
C2 7 56
Styling 2 Exterior C1 10 20
C2 4 8
Interior C1 9 18
C2 7 14
Total Contribution to Expected Satisfaction Count by C1=386 & that by C2=422
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“SS” model as actually evaluated!
Need criteria
Importance of Need Brand
Evaluation of Brand
Contribution to expected satisfaction
Cost 8 Skoda Octivia 6 48Honda Civic 7 56Optra Magnium 8 64Toyota Corolla 8 64
Economy 10 Skoda Octivia 10 100Honda Civic 5 50Optra Magnium 8 80Toyota Corolla 7 70
Rear Defrogger 2 Skoda Octivia 6 12Honda Civic 7 14Optra Magnium 8 16Toyota Corolla 8 16
Fuel Type 8 Skoda Octivia 8 64Honda Civic 6 48Optra Magnium 8 64Toyota Corolla 6 48
Interior Styling 4 Skoda Octivia 8 32Honda Civic 9 36Optra Magnium 7 28Toyota Corolla 6 24
Exterior Styling 4 Skoda Octivia 8 32Honda Civic 8 32Optra Magnium 6 24Toyota Corolla 5 20
Cost of Maintenance 5 Skoda Octivia 10 50Honda Civic 7 35Optra Magnium 7 35Toyota Corolla 6 30
Total Score Skoda Octivia 338Honda Civic 271Optra Magnium 311Toyota Corolla 272
Compensatory model used for evaluation
SS Sunil Sood – PG Retail (06-08) - #176
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Service Cost C1 4 Eliminated
C2 8
C3 8
C4 8
Gas Mileage C2 8
C3 8
C4 6
Speedof Repairs
C2 8
C3 6
Selection = C2
RemarkGoal Object Make /Brand
Evaluationof Brand
Eliminated
Eliminated
Noncompensatory model for evaluation
Assumes that consumers rate brands by one criterion at a time
rather than evaluating each brand across all criteria.
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“SS” model as actually evaluated!
Non-compensatory model used for evaluation
Economy
Skoda Octivia Y
Honda Civic N
Optra Magnium Y
Toyota Corolla Y
Cost of Maintenance
Skoda Octivia Y
Optra Magnium Y
Toyota Corolla N
Fuel Type
Skoda Octivia Y
Optra Magnium N
SS Sunil Sood – PG Retail (06-08) - #176
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Expected Satisfaction
The brand that comes closest
to meeting the most important needs
is expected to provide the most satisfaction
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Input Variables
NeedRecognition
Consumer’sPsychological
Set
StimulusExposure
D & E - Purchase & Postpurchase Evaluation
Perceptionof Stimuli
Search forAdditional
Information
Selectivity
Changes inConsumer’s
Psychological Set
NeedAssociation
ExpectedSatisfaction
Intentionto Buy
PurchasePostpurchaseEvaluation
Feedback
NoPurchase
Tension State
Instrumental actions
Outside Constraints
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Intention to Buy
Instrumental actions viz…
1) Select a dealer
2) Decide when to purchase
3) Go to place of purchase
4) Arrange for financing
MNC*MNC*
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Purchase
1) What influenced consumers to buy?
2) Will they be satisfied after purchase?
Issue for Strategies
&
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Postpurchase Evaluation
Done in the process of consumption
1) By the consumer and not by the purchaser
2) Purchase depends on consumer expectations of the degree to which brands are likely to satisfy needs.
3) Whether the brand is likely to be repurchased
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Satisfaction versus Dissatisfaction
S => reinforces +ve attitudes
towards brands
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Postpurchase Dissonance
Any –ve information about the chosen product causes…
It means conflicting results from two contradictory beliefs
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How consumers react
1) Ignoring the dissonance information
2) Selectively interpreting the information by saying that any brand will have occasional lemon.
3) Lowering level of prior expectations, though few problems, acceptable!
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1) Focus on +ve performance and tend to dismiss
or rationalise the –ve!!
ASSIMILATION THEORY
2) CONTRAST EFFECT (Discard it!)
Ways…
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Habit, Learning and Decision Making
Opposite of complex Decision Making… Habit.
1) Habit and learning lead to brand loyalty. Brand loyalty is the result of consumer involvement.
2) Habit and learning can also lead to buying the same brand because of inertia. Inertia is the result of lack of involvement.
Habit = Monotony + Boredom
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Selectivity
Tension State
Consumer’s Psychological Set
Stimulus Exposure
Perception Of Stimuli
Need Association
Need Recognition
Post-purcshase Evaluation Purchase Intention to
buy
Satisfaction & Reinforcement
Dissatisfaction & Extinction Outside
Constraints
Revert to Complex Decision Making
Model of Habitual Purchasing Behaviour
Feedback
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Habit
1) Information seeking
2) Evaluation of alternative choices”
• Model of habitual purchasing behaviour. “as a limitation or absence of…
&
• Classification of habitual purchasing behaviour.
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Was old brand repurchased?
No* Yes
How many brands were thought of at outset of decision process?
Many* A Few One
Was old brand among those thought of?
Was old brand one mainly thought of?
No* Yes No* Yes
Any brand-related info seeking?
Any brand-related info seeking?
Yes No** Yes** No***
*Complex decision making**Decision making that approaches habit***Habit
A classification of Habitual Purchasing Behaviour
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Functions of habit
Habit provides two important benefits to consumers.
1) It reduces risk
2) It facilitates Decision Making.
2) More reliance on information on price and availability Less reliance on product specific information (say, freshness)
Result is…
1) A shift in type of information sought General product information Specific brand information
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Consumer’s Psychological Set
Distribution …..Extensive
Product …..Packaged goods, few services and direct selling
Advertising …..reminder
In-store stimuli…..More display, Shelf position
Pricing …..Deals, special sales, free samples.
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Limited decision making
habit
Complex decision making
Repetitive Purchases
Probability of purchasing same brand again
Repetitive Purchases
Time spent in prepurchase information search
Complex decision making
Limited decision making
habit
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Inducing a Switch from habit to Decision Making
1) Advertise new features
2) New feature never tired
3) Free product samples, Coupons or price specials.
4) Line extension of existing brand
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Habit and Consumer Learning
Learning theory
Key concepts => Contiguity, reinforcement, extinction
LT1: Classical Conditioning
LT2: Instrumental Conditioning
LT3: Cognitive Learning
Behaviouristic
Cognitive
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Types of Learning Theories
Learning Theories
Behaviorist Cognitive
Classical Conditioning
Instrumental Conditioning
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LT1: Classical Conditioning
Secondary stimulus is paired with
Primary stimulus that already elicits a particular response.
Eventually, the secondary stimulus will elicit the samereaction as the primary stimulus.
Marlboro
The pairing results in association formation.
Repetitive stimuli & establishment of a close association – contiguity between a secondary stimulus (Social Success) & a primary stimulus (The Brand)
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LT1: Classical Conditioning
Unconditioned stimulus
Conditionedstimulus
Unconditioned response
Conditionedresponse
Emphasis: Association through repetition and contiguity
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1) Individual determines the response that provides greatest satisfaction.
2) Response is within conscious control of individual.
3) “Subject is free to act in a variety of ways. The consequences of the act (i.e. degree of satisfaction or dissatisfaction) will influence future behaviour.” ….B.F.Skinner.
LT2: Instrumental Conditioning
4) Reward repeat v/s punishment act.
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LT2: Instrumental Conditioning
Behaviour
Reward or
Punishment
Increase or decrease in probability of response
Emphasis: Reinforcement, dependence of outcome on learner’s action
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Reinforcement
Increases probability of purchase
of same brand repeatedly => HABIT
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Extinction and forgetting
1) Consumer dissatisfaction leads to extinction
2) Stimulus no longer repeated / perceived leads to forgetting
Probability
Of
purchasing
on
the next trial
50%
100%
1 2 3 4 5 6 7 8 9
No. of repetitive exposures over time.
n
Forgetting
Rein
forc
emen
t
Extinction
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Application of LT 2
1) Focus on reinforcement so
2) Product satisfaction
3) Role of advertising is to increase the consumers’ expectation of reinforcement
4) Sales promotion should create initial inducement
P.S. LT 2 is closer to HABIT than LT 1
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1) Learning is problem solving process. Thought process involved in consumer learning
2) Awareness, Interest, Evaluation.
LT3: Cognitive Learning Theory
3) Emphasise thought process achieve goals
4) Reinforcement is recognised part of cognitive learning.
“LEARNING is result of INSIGHT.”
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LT3: Cognitive Learning Theory
GoalPurposive Behaviour
InsightGoal Achievement
InsightInsight
Emphasis: Problem solving; understanding relationships
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Brand Loyalty
Close link between…Habit, learning and brand loyalty.
“Brand loyalty represents a favourable attitude towards andconsistent purchase of, a single brand over time”
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A 1) Instrumental Condition (1. Stochastic and 2. Deterministic)
Two Approaches
A 2) Cognitive Theory (1. Tucher Versus 2. Jacoby)
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1) Stochastic Model
…… since doesn’t predict one specific course of action probability terms
2) Deterministic Model
……. Since predict a particular course of action based on input variables such as needs, attitudes, consumer characteristics, etc.
E.g. Habit model
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A1: Instrumental Conditions - Behavioural
1) Sequence of purchase
2) Proportion of purchase
Rely on consumer panel data, measure Brand Loyalty by…
&
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Limitations
1) Past behaviour may mislead. E.g.. Brand 1 for self brand 2 for wife and high priced brand 3 for guests
2) Purchase may not reflect reinforcement
3) Multidimensional; concept not just past behaviour but commitment to brand
• Note: Only 2a) & 2b) => A1
a) reversion (switch back to original)b) conversion (loyal to new brand)c) vacillation (random switches)d) experimentation (systematic trial)
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1) Tucher
No consideration should be given to what the subject thinks or what goes on in his central nervous system. His behaviour is the full statement of what brand loyalty is.
2) Jacoby
To exhibit brand loyalty implies repeat purchasing behaviour based on cognitive, affective, evaluative and predispositional factors – the classical primary components of an attitude.
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1) Brand Loyalty includes both attitude and behaviour
2) Favourable attitude together with commitment and involvement with purchase leads to Brand Loyalty
A2: Cognitive Approach
(DAY)
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Low involvement Decision Making
Product considered not
Important to the belief system
and not strongly identify
a product
Acceptable (optimal X) minimise problems (max benefits X)
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1) More likely to be influenced by reference groups
2) More self confident in his or her own choice.
3) More likely to perceive a higher level of risk in purchase
Brand Loyal Consumer
4) More likely to be store loyal.
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1) Has functional significance
2) Entails significant risks
3) Emotional appeal (JWT)
Consumer Involvement
4) Identified with norms of a group
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Low involvement Hierarchy
1) Act without thinking
2) Receive information passively ….. information catching and not seeking
3) Need…. (How is need aroused in low involvement products) familiarity with repeated advertising.
Thus… 1. Brand belief by passive learning2. Purchase decision3. May / may not be evaluated
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Perceived Differences Between Brands
Complex Decision Making or Brand
Loyalty
Variety seeking
DissonanceReduction
or Attribution
High Involvement
Few
Low Involvement
SignificantRandomChoice
Experimentation
Inertia
RandomChoice
SpuriousLoyalty
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High Involvement
FewDifferencesBetweenBrands
Low Involvement
SignificantDifferencesBetweenBrands
Model• Beliefs• Evaluation• Behaviour
Model• Beliefs• Behaviour• Evaluation
Model• Behaviour• Beliefs• Evaluation
Model• Beliefs• Behaviour
TheoryCognitive Learning
TheoryPassive Learning
TheoryDissonance or Attribution theory
TheoryPassive Learning
Decision ProcessComplex Decision Making or Brand Loyalty
Decision ProcessVariety Seeking
Decision ProcessDissonance Reduction or Attribution
Decision ProcessInertia
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1) Complex decision Making and Brand Loyalty
2) Inertia – a passive process
3) Variety Seeking
Earlier figures show…
4) Dissonance Reduction or Attribution
a) information processingb) brand choicec) evaluation or X !!
a) try variety of brandsb) little psychological or social involvementc) brand switching exists!(*1982 R.H. Bruskin)
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Dissonance Theory
Dissonance is a state of post purchase conflict created by
contradictory belief.
If consumer is involved in the purchase decision and sees
little difference between characteristics of
several brands then purchase dissonance is likely to result
regardless of the brand chosen.
1) Behaviour occurs first
2) Brand beliefs are formed to support the chosen brand
3) Brand is favourably evaluated
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So Attribution Theory…
{“Since I bought it…
…it must be good!”}
Consumer will attribute certain motives to their actions
after the fact.
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1) If significant difference => advertise
2) No perceived brand difference=> advertising should
Marketing Implications
(I) Complex decision Making V/s Dissonance
a) influenceb) reassure, once choice made
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1) For LI advertising
2) For HI advertising
Marketing Implications
(II) High Involvement V/s Low Involvement
a) do more than create awarenessb) influence with persuasive messagesc) content is the key (but not the repetition)d) complex message involved and varied A/Ve) likely to deal more directly with desired product benefit
a) create awarenessb) familiarity through relationsc) only a few points should be emphasisedd) positively identified symbol with brand to be advertised
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A) Advertising
B) Positioning: - LI to solve problem, HI to deliver benefit
C) Price: - LI products are frequently purchased on price alone (REF: Lastovicka in study of margarine)
D) Sales Promotion: - Hence high for LI (brand switch when brand reverts to normal price)
E) In Store Condition: - Also high for LI product
F) Distribution: - widespread (Horizontal) distribution for LI
G) Product trial: - Important for LI product
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1) KRUGMAN’S Theory of passive Learning.
2) SHERIF’S Social Judgment Theory.
3) THE ELABORATION LIKELIHOOD MODEL
Consumer Involvement
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1) TV is L.I. medium that results in passive learning, little influence on attitudes
2) TV advertising is animate, viewer is inanimate.
3) Pace of viewing is out of control, little opportunity for reflection of making connections
L.I. Theory 1: KRUGMAN’S… Passive Learning
4) TV is effective for L.I. products
5) The public lets down it’s guard to the repetitive commercial use of television.
“Perspective of Television”
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1) Info processors
2) Info seekers
3) Active audience for advertising
L.I. T1 V/s traditional views
4) Evaluate brands before buying
5) Seek to maximise expected satisfaction
“Customers are…”
6) Personality and lifestyle related to Consumer Behaviour
7) Reference groups influence Consumer Behaviour
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1) Sheriff describes an individual’s position on an issue according to that individual’s involvement with the issue.
2) Concept of involvement with latitude of
(Say H.I., with definite opinion will ‘a’ less, ‘b’ more and ‘c’ few!)
a) Acceptance, b) Rejection, c) Non committed.
L.I. Theory 2: Sheriff’s Social Judgment
a b c
(NOTE: (1) President = H.I. & (2) State = L.I. election)
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1) THE WAY (PROCESS H.I. and L.I. Conditions).
2) Elaborate (central) to Non-elaborate (peripheral)
3) Degree of elaboration depends on the RELEVANCE
L.I. Theory 3: Elaboration likelihood Model
4) Uninvolved customer is PASSIVE so provide stimuli that are peripheral to the message.
Petty and Cacioppo model
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1) Should try to get C more H.I.
2) Repetitive buying inertia to variety seeking
3) Should advertising perspective differ from L.I. v/s H.I.
STRATEGIC ISSUE IN L.I. DECESION MAKING
4) Should segmentation be a basis of L.I.- H.I. for a particular product category.
These points are covered one slide each
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1) Link product to some involving issue
2) Link product to some involving personal situation
3) Link product to some involving advertising
SHIFTING CONSUMER FROMLow Involvement TO High Involvement
4) Change importance of product benefits
5) Introduce important characteristics in product
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SHIFTING CONSUMER FROMINERTIA TO VARIETY SEEKING
If brand market leader Continue inertia
Hence judicious selection of marketing mix
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1) Focus on few key points
2) High repeat advertising short duration
3) Considerable LEEWAY acceptable to consumer
ADVERTISING STRATEGIES FOR L.I. PRODUCT
4) Visual & new message components emphasized
5) Advertising can be primary means of differentiating from competition
6) T.V. (rather than print) be primary vehicle
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1) Introspect strategic issues (& philosophy)
2) Toothpaste, say, H.I., L.I. & medium I
3) Cereal is L.I. product but parents concerned , nutritional benefits for the children are thus H.I. consumers
Segmentation by Degree of Customer Involvement
4) Where it is possible to identify H.I. & L.I. marketers should consider differentiation
Part 1 Consumer Decision Making Concluded!
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…THE INDIVIDUAL CONSUMER…
1) Consumer’s thought variables
2) Consumer’s • Demographics • Lifestyle • Personality characteristics.
• Perceptions • Attitudes. • Needs
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Consumer’s Thought Variables
CTV are CENTRAL to CB since they affect development of product and promotion strategies.
Perceptions
Perceptions provide criteria for evaluating promotional effectiveness by indicating levels of brand and advertising awareness.
Brand Attitudes
Brand attitudes provide basis for determining whether the marketer is positively influencing.
Needs
Needs define areas of market opportunities for new products and repositioning.
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Consumer’s • Demographics• Lifestyle• Personality characteristics
……are important in describing the consumer and are used to segment the market.
Management wants to know the characteristics of its potential users so that it can develop promotional strategies to appeal to them and select media vehicle/s to reach them.
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CONSUMER PERCEPTIONS
AND
INFORMATION PROCESSING
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Perceptions…
…are the basis by which consumers
process the information
communicated by advertisers
(communicators)
and other sources of marketing
and environmental stimuli.
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A. Key step in perception of marketing stimuli viz selection and organization of stimuli
B. Model of information processing for H.I., L.I. decisions.
C. What consumers are perceiving and processing-marketing stimuli.
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A. Consumer Perceptions
I. Selective Perception
II. Perceptual organization
Two processes are…
&
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I. Selective Perception
1) Selective Exposure
2) Selective Attention
3) Selective Comprehension
4) Selective Retention
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Selective ExposureEngel Study
• New car purchasers
• recall and interest in advertising of own cars
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Selective AttentionBrehm Study
• Supportive information, Avoid contradictions
• Choose gifts Report +ve vs. –ve
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Selective ComprehensionKasserjian and Cohen Study
• Interpret ‘discrepant’ as ‘consistent’
• Smoker : Cancer 80% : 52%
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Selective RetentionBogart Study
• Remember relevant to Decision
• 2 min. ago ad. Identify Later content % Dropping !
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Routine and expected information screened out
Information unrelated to needs screened out
Low
Low
High
High
Degree of Involvement
Level of Information
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1) SP ensures that consumers will receive information most relevant to their needs and to brand evaluation => Perceptual vigilance (size of same coin- big by poor children)
2) consumer sometimes distort information to conform their beliefs and attitude
Functions of selective perception: -
…second function of SP is called as perceptual defense.
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Conditions likely to produce perceptual vigilance
1) Consumer needs structure (say mileage oil ads)
2) Greater the needs greater the perceptual vigilance (technology products) – vigilance is in selecting
3) Also true for low need – vigilance is in discarding
4) So, PV is highest when for very H.I. & L.I. When H.I.=> Information unrelated to needs is out When L.I.=> Routine/expected information is ruled out.
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MS7
Conditions Likely to produce Perceptual Defense.
1) Stronger beliefs and attitudes, greater PD
2) Greater consistency of experience, Greater PD., jewelers, family doctors.
3) Greater anxiety produced by stimulus, greater PD
4) Greater level of post purchase dissonance, Greater likelihood of PD
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MS7
Perceptual Equilibrium
When Consumers choose information consistent
with prior beliefs or interpret information to
confirm to these beliefs they are processing
information to ensure perceptual equilibrium
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MS7
In support are…
1) Sheriff's social judgment theory.
2) Heider’s balance theory. When information about an object conflicts with the consumers beliefs balance will be achieved by changing one’s own opinion about the object, the sources of information or both.
3) Cognitive dissonance theory.
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MS7
Perceptual Disequilibrium
Consumer do have conflicts with prior beliefs
and often change brands however, such
Conflicts or Disequilibrium can occur either
before or after the purchase
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MS7
Disequilibrium before the purchase
1) Consumer is more likely to listen since commitment has not been made
2) So, accepts contradictory information before purchase.
3) Such information, in fact may be more revealing
4) Once decision => Contradictory information out for
Perceptual Equilibrium
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MS7
Disequilibrium after the purchase
1) Consumer also accepts discrepant information after the purchase
2) Refer learning and cognitive dissonance theory.
3) Result is reduction in probability of repurchase 80% non smokers accept link between smoking and cancer, over 50% heavy smokers also accept the link, these smokers are in state of Disequilibrium.=> Result proves perceptual Equilibrium.
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MS7
II.
PERCEPTUAL
ORGANISATION
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Principle 1:- A tendency to place information into logical categories, Categorization helps consumer process, know information quickly and efficiently and also helps consumer to classify new information.
Principle 2: - Integration means various stimuli will be perceived as organized whole, giving an integrated meaning for the stimuli. (derived from GESTALT psychology… THE WHOLE is greater than SUM of parts Ex: every component of advertising => brand image)
II. Perceptual organisation
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MS7
Perceptual categorization
Consumer categorises stimuli by…
1) Level – say price ,H/M/L , size ,L/M/S etc
2) Association- Brand name , Category
3) Generalisation- new information as something familiar
Resulting in Perceptual Scripts
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MS7
Perceptual Integration
“PEOPLE ORGANIZE PERCEPTIONS
TO FORM A
COMPLETE PICTURE OF AN OBJECT”
GESTALT psychologist’s basic hypothesis
1) Closure, 2) Grouping and 3) context
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1) Closure =>
2) Grouping =>A variety of information is perceived as CHUNK.Thus chunking of information through…• Proximity ….1st and 2nd due closeness • Similarity…. Stereotyping• Continuity: Grouping and uninterrupted.
Tendency to fill in the missing elements whenthe stimulus is incomplete.
3) Context =>Tendency to perceive by context• Figure. prominent stimuli => perception• Ground (back) …less prominent to stimuli => perception
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MS7
B. Information Processing
I) High Involvement Information Processing
II) Low Involvement Information Processing
&
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3) Storage in memory and eventual retrieval of information is used for brand evaluation
1) Select stimulus get stored in memory • Pay Attention=> stimulus • Comprehension => stimulus • Retaining => stimulus
2) In process of selecting stimulus consumers organize themselves by
• Categorisation • Integration
I. High Involvement Information Processing
Is extension of Information Processing in Complex Decision Making
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MS7
Search For Additional
Information (External Source)
STIMULUS EXPOSURE
Consumer’s Psychological Set Perception Of Stimuli
SelectionAttention
Comprehension
Retention
Organisation
Categorisation
Integration
STORAGE
MEMORYRETRIVAL(Internal Search)
Brand Evaluation
Changes in Beliefs about the brand
Changes in brand Evaluation
Changes in Tendency to Act
High Involvement Model of Information Processing
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MS7
II. Low Involvement Information Processing
Information can be stored in
memory without going through
a sequence involving
attention and
comprehension
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MS7
Search For Additional
Information (External Source)
STIMULUS EXPOSURE
Consumer’s Psychological Set Perception Of Stimuli
Selection
Retention
Organisation
Categorisation
Integration
STORAGE
MEMORYRETRIVAL(Internal Search)
Brand Evaluation
Changes in Beliefs about the brand
Changes in brand Evaluation
Changes in Tendency to Act
Low Involvement Model of Information Processing
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MS7
Steps in information processing
Step1: - Selection Ref: Elaboration Likelihood Model (ELM)e.g. Huggies
Step2: - Organisation Resulting in information processing strategies Reason : Consumers need some set of guidelines or decision rules
Step3: - Memory Frequency of advertising for retention Attribute ratings for best brand (Concept study result Testing )
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MS7
TYPES OF STRATEGIES
BRAND STRATEGIES
NONBRAND STRATEGIES
BRAND EVALUATION
INFORMATION CHUNKING
PROCESSING BY ATTRIBUTE
PROCESSING BY OBJECT
Information Processing Strategies
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MS7
Marketing Stimuli
&
Consumer Perception
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MS7
C. Marketing Stimuli & Consumer Perceptions
Marketing Stimuli:-
1) Primary Stimuli:- Product and its components
2) Secondary Stimuli:- Words, pictures, symbols, or other stimuli associated with the product like price, merchandising, sales, promotion etc.
Any communication or physical stimulus that is designedto influence consumer
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MS7
Key Requirement: Product Concept Development
…is a bundle of product benefits that can be directed to the
defined needs of consumers through messages, symbolism
& imagery and it is organization of secondary stimuli
Product concept…
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MS7
Stimulus factors affecting perceptions
A) Structural Factors
B) Sensory factors • Smell :- perfume=>expensive v/s cheap• Taste :- Strong => Coffee • Feel :- Textiles • Colour (& such common factors)
• Size:-Increase in Impact=Square root of size • Position:-Specific pages, upper portion etc. • Colour:-Colour ad prefer to B&W ad. • Contrast:-Produce increased attention • Novelty:-Attention getting device
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MS7
Stimulus discrimination
“Whether consumers can discriminate”
Hence,
Advertising is the key ingredient!
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MS7
The Just Noticeable Difference.(JND)
“Differential threshold exists in comparing 2 stimuli”
This differential threshold represents JND
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Weber’s law
1) “Stronger the initial stimulus, greater the change required for (new) stimulus to be seen different”
2) “Increase in difference required to reach JND is CONSTANT”
K=I/I……K=constant , I = original, I= e.g. for a category of music system….on a price of 100$, 10$ increase is JND
Two German psychologists (100 yrs ago)
&
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MS7
Absolute threshold:-
Below which consumer cannot direct stimuli at all.
Subliminal perception:-
Perception of a stimulus below the conscious level.
(Limen….Threshold level at which perception occurs)
Note:-Vicary Test“eat popcorn” and “drink coca cola” shown in movie theatrefor 1/3000 th of a second at intervals of 5 seconds “58% & 18% growth respectively”
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MS7
Stimulus generalisation
Consumers learn to generalise from 1 similar stimulus to another
(Similar to classical conditioning)
(Brand loyalty is a form of stimulus generation)
e.g. Automobile=horseless carriage (horse + carriage)
at the time of first introduction
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Individual differences in Stimulus Perception
On account of three characteristics viz.
1) Perceptual ability
2) Perceptual Style
3) Perceptual Disposition
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MS7
1) Perceptual abilities
Three components viz.
1) JND level
2) Adaptation level (adjusting to the stimuli)
3) Attention span. (Number of times perceived)
are differentfor differentConsumers
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MS7
2) Perceptual styles
Certain consumers have a propensity to process informationin a certain way.
1) By attitude
2) By object
3) By simple decision rules
This PROPENSITY defines perceptual style
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MS7
3) Perceptual predispositions
Consumer’s needs, attitude and
past experiences will affect how
consumer perceives stimuli
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Measuring Consumer Perception
1) Exposure
2) Attention
3) Comprehension
4) Retention
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Measuring Information Processing
1) Amount of information consumers require
2) Processing strategies they use
3) The way information is categorized
4) The way it is evaluated
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MS7
Consumer Attitudes
And
Needs
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MS7
Measures of attitude and need components Attitude components
Brand beliefs (b)b1: How likely is it that Brand A has the following characteristics:
Brand A is a highly carbonated cola
Improbable__ __ __ __ __ __ __ __ __ __ __ __ __ __ __ Probable
Brand A is a sweet cola
Improbable__ __ __ __ __ __ __ __ __ __ __ __ __ __ __ Probable
b2: Rate Brand A by the following characteristics:
Highly Carbonated__ __ __ __ __ __ __ __ __ __ __ __ __ __ __ Not Carbonated
Sweet__ __ __ __ __ __ __ __ __ __ __ __ __ __ __ Not Sweet
b3: Indicate how well Brand A is described by the following characteristics:
Brand A is a highly carbonated cola
Describes very well__ __ __ __ __ __ __ __ __ __ __ __ __ __ __ Does not describe at all
Brand A is a sweet cola
Describes very well__ __ __ __ __ __ __ __ __ __ __ __ __ __ __ Does not describe at all
147CB
MS7
Measures of attitude and need components Attitude components
Overall Evaluation (A)
A1: Rate Brand A as follows:
In general, In general,
I like it very much __ __ __ __ __ __ __ __ __ __ __ __ __ I don’t like it at all
A2: Rate Brand A as follows:
Very favourable __ __ __ __ __ __ __ __ __ __ __ __ __ Very unfavourable
A3: Which of the following brands do you prefer most? Which of the brands do you prefer second, third, etc.?
A4: Suppose you could pick ten free cans of cola and had the choice of any combination of brands, which brands would you pick? How many cans of each brand?
(Make sure the total adds up to ten cans.)
148CB
MS7
Measures of attitude and need components Attitude components
Intention to Buy (BI)
What is the likelihood you will buy this brand the next time you purchase cola?
Definitely will buy _____
Probably will buy _____
Might buy _____
Probably will not buy _____
Definitely will not buy _____
149CB
MS7
Measures of attitude and need components Need (Value) components
Direction component (a)a1: Indicate how would you evaluate the following:
A highly carbonated cola
Good__ __ __ __ __ __ __ __ __ __ __ __ __ __ __ Bad
A sweet cola
Good__ __ __ __ __ __ __ __ __ __ __ __ __ __ __ Bad
a2: Indicate the degree of satisfaction you would get from the following:
A highly carbonated cola
Very satisfied__ __ __ __ __ __ __ __ __ __ __ __ __ __ __ Very dissatisfied
A sweet cola
Very satisfied__ __ __ __ __ __ __ __ __ __ __ __ __ __ __ Very dissatisfied
a3: Think about your ideal brand of cola and rate it on the characteristics listed below:
Highly Carbonated__ __ __ __ __ __ __ __ __ __ __ __ __ __ __ Not Carbonated
Sweet__ __ __ __ __ __ __ __ __ __ __ __ __ __ __ Not Sweet
150CB
MS7
Measures of attitude and need components Need (Value) components
Intensity of Importance (I)
Rate each of the following characteristics based on how important they are in determining your selection of a brand of cola.
Right degree of carbonation
Very important__ __ __ __ __ __ __ __ __ __ __ __ __ Not important at all
Right level of sweetness
Very important__ __ __ __ __ __ __ __ __ __ __ __ __ Not important at all
151CB
MS7
The nature of Attitudes and Needs
…are learned predispositions to respond to an object or class of objects in a consistently favourable or unfavourable way. - Gordon Allport
Attitudes…
152CB
MS7
The nature of Attitudes and Needs
…are inner motivational states those are aroused by external stimuli or internal cues…..
Needs …
(...needs are the goals consumer strives for in making a purchase…)
‘Needs influence attitudes and attitudes influence purchase.’
153CB
MS7
Attitudes in HI decisions
Three components of attitudes
1) Beliefs……. Thinking or cognitive component
2) Brand Evaluation………. Feelings or affective component (traditional definition of attitudes)
3) Intention to Buy…….. Action or conative component.
154CB
MS7
Perceived Instrumentality
BrandBeliefs
ConsumerNeeds
BrandEvaluation
Intentionto Buy
155CB
MS7
Study by Woodside
Findings: - Broader multidimensional measure of brand attitudespredicted “intensions to buy” much better than narrower singlemeasure
1) Brand attitudes were measured on a multidimensional basis by rating of brand attributes
2) And on a one dimensional basis of an overall evaluation of brand.
THUS
This new definition of an attitude is the basis of multiattributemodels
156CB
MS7
Attitudes in L.I. decision
1) Attitudes don’t have a central role in L.I. decision (As in H.I. decision)
2) Attitudes may not have predictive value but frequently has diagnostic value
157CB
MS7
Functions of attitudes
DANIEL KATZ 4 classification
1) The utilitarian function
2) The value expressive function
3) The ego defensive function
4) The organization of knowledge function
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MS7
1. The utilitarian function
Attitudes guide consumer in achieving
desired needs
E.g. instant relief analgesic the brand
“CREST WHITENS TEETH”..
“LISTERINE FRESHENS MY MOUTH”
159CB
MS7
2. The value expressive function
Attitudes express a self concept & value such as -
system conservative & dress, success &
wealth
PEPSI DRINKERS THINK YOUNG
160CB
MS7
3. The ego defensive function
Attitudes protect ego from anxieties and
threats. Mouth washes (Listerine) for
bad breadth avoiding
“Marlboro smokers are masculine”
161CB
MS7
4. The organization of knowledge functions
Attitudes organize the mass of information
Consumers are exposed to daily and help
set up standards on which to judge the
information
‘7UP is caffeine free’ {UN- COLA}
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MS7
Attitude development
Through a learning process affected by…
1) Family influences (e.g. J&J at her wedding – mother gifts baby powder to daughter)
2) Peer group influences
3) Information and experience
4) Personality. (Say aggressive personality by attempt to excel buys competitive or expensive items.)
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MS7
3) Tendency to act (cognitive)…..Purchase intact
1) Beliefs (cognitive)…. 2 Types• informational (with attribute)• evaluative (with benefits)
2) Brand evaluation (affective)….one dimension
i.e. poor => excellent or prefer => reject
Attitude components
Is extension of Information Processing in Complex Decision Making
164CB
MS7
Relationship between C-A-C (B-E-B)
Note: B-E-B sometimes logically inconsistent
1) Consistency between C-A-C
2) BALANCE THEORY… Links Cognitive with Affect “A person seeks to achieve balance between evaluation and belief”
165CB
MS7
Need Components
Made up of…
1) Direction ….. Nature of need (mild to strong coffee).
2) Intensity……. Importance of need to the individual
166CB
MS7
Attitude
And
need measurement
167CB
MS7
BELIEFS
Three methods
b1 rates brand attributes on a probability basis
b2 scaling device called semantic differential
b3 measures accuracy of the description
p.s. Semantic differential – equal interval scale
Semantic differential method more popular
168CB
MS7
EVALUATION
a1 likeability
a2 favorability
a3 rank order of preference (ordinal scale)
a4 constant sum scale (ratio properties)
169CB
MS7
TENDENCY TO ACT
1) Purchase intend scale
2) Standard scale
170CB
MS7
NEED
n1 Direction – a1,a2,a3 (semantic differential scale is used)
n2 Intensity – i1, i2 (importance scale is used)
171CB
MS7
The Relationship of Attitudes to Behaviour
1) Evidence of relationship between attitude and behaviour
2) Relationship between intension to buy and behaviour
3) Factors inhibiting the relationship between the attitude and behaviour.
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MS7
The Relationship of Behaviour to Attitudes
1) Cognitive dissonance …..Attitudes change to confirm to previous behaviour, thus reducing the post purchase conflict
2) Passive Learning……..Attitude after usage
3) Disconfirmation of expectation…..The two theories of assimilation and contrast
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MS7
Multiattribute Models of consumer attitude
…determines how well a brand meets consumer
needs across several product attributes. …
Thus helps in diagnosing strength and weakness
of their brands to competition.
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MS7
Nature of Multiattribute models
All models regard attitude as a function of consumer beliefs aboutthe attribute of a brand
They also weigh beliefs by value or importance of the attribute ….
E.g. Consumer who regards Pepsi as a strongly carbonated, sweetcola and places a high value =>will havepositive attitude =>likely to buy.
175CB
MS7
The Original Fishbone model
“An attitude towards an object depends on the
probability that the object has certain attributes
and on the value, placed on these attributes”.
176CB
MS7
The Extended Fishbone model (Modifications)
Modification 1----- attitude measurement is directly proportional
to act of purchasing
Modification 2 ---- Other elements - social influence
177CB
MS7
Non compensatory models of attitude structures
1) Conjunctive
2) Disjunctive
3) Lexicographic
178CB
MS7
Demographics
179CB
MS7
Needs and Attitudes v/s Consumer Characteristics
1) Product specific
2) Related to brand / product
3) Subjective
4) Harder to formulate
Are generalized
Not related to brand / product
Standardized, especially demographics
5) Harder to formulate, measureMeasurable
Objective
6) Skewed towards cons behav. Skewed towards cons description
7) Mrktr unaware of it, is admitted but probed
Mrktr unaware of it, is flying blind
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MS7
Changing Demographic Trends
A) Increased proportion of working women
B) Women employed in traditional male jobs
C) Changing family roles so, %age of males shopping for food,
cooking for family and taking care of young children goes up
D) Changing age composition so, Increased youth market, senior citizens…..
E) Elderly Market Increase in life expectancy,
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MS7
Changing Demographic Trends
F) Youth market High %age of population with high purchasing power
G) Family composition Increase in divorce rate, joint family goes down (Nest Theory)
H) Changes in birth rate Coupled with mortality rate
I) Income groups HIG/MIG/LIG TO 9 tire……
J) Regional trends Urban/rural ….. Town specifics
K) Increasing mobility (e.g. Average American moves 14 times in life)
182CB
MS7
Demographics for Marketing Strategy
1) Describe consumers
2) Identify brand or product segments
3) Select media
4) Evaluate the potential for new products
183CB
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PSYCHOGRAPHICS
184CB
MS7
A mode of living that is identified by how people spend
their time (activities-’A’); what they consider important
in their environment (interests-’I’); and what they think
of themselves and the world around them (options-’O’).
e.g. Activities - work, shopping, hobbies, sports.Interests – family, media, fashion, food.Opinions – themselves, future, politics, culture.
Psychographics - Life Style (AIO grid)
185CB
MS7
Changing Life-Style Trends
1) Traditional to Modern
2) Concern for Health and Nutrition
3) Self Orientation….Individual Concerns
4) Conservative to Open
5) More Frugal and Practical life style that reflects concern with
Economic factors and a willingness to be more self sufficient
6) ______________________________________
7) ______________________________________
8) ______________________________________
186CB
MS7
1. By activities, Interests and Opinions (AIO) Wells and Tier Method …. Formation of 300 + AIO statements, ask respondents to agree or disagree on a six point scale. e.g. ‘I like to be considered a leader’. Then reduce to 22 life style dimensions by use of factor analysis.
2. By Purchase Inventories Describe consumer behavior by their buying activities. (Say) car conscious man is a heavy purchaser of car wax, motor oil, grease etc.
This was a study done by Alpert & GattyThere was a study done between light & heavy beer drinking cons.It was found light beer drinking ppl were found to be hard drinkers, outgoing people and such distinct lifestyles
Measuring Life Style Characteristics
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MS7
More deep-seated than lifestyle
Since personality variables reflect
consistent, enduring patterns of behavior
PERSONALITY
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MS7
Personality Theories
PT1: Trait Theory
PT2: Psychoanalytic Theory
PT3: Social Theory
PT4: Self Concept Theory
189CB
MS7
PT 1: TRAIT THEORY
Personality is composed of a set of Traits
that describe general Response
Predispositions.
Agree……Disagree scale is used
Factor Analysis is the technique
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MS7
PT 1 : AEdward’s Personal Preference Schedule EPPS
It measures 14 personality items
such as…
{achievement, compliance, order}achievement – to rival & surpass others &
to do one’s bestcompliance – to accept leadership & to follow willinglyorder – to have things arranged & also means things to be organized
191CB
MS7
PT 1 : BGordon Personal Profile GPP
Measures responsibility, ascendancy,
emotional stability, sociability
{e.g. DRAVID, SOURAV, SACHIN.}
192CB
MS7
PT 1 : CThurstone Temperament Schedule
Measures
Dominance,
Stability
and Impulsiveness
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MS7
PT 2: PSYCHOANALYTIC THEORY
1) Stress the unconscious nature of personality as a result of childhood conflict
2) Manifestations of these conflicts determine the adult personality and frequently influence behavior in a manner the adult is not aware of
3) Emphasis on unconscious motives and repressed needs result in a non-empirical approach to personality.
4) In applying FREAUD’s theories unconscious motives could be determined only by indirect methods, hence
5) Two Techniques viz. {1} Depth Interviews and {2} Projective Techniques =>{situation, cartoon or set of words given & consumers asked to respond}
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MS7
PT 2: PSYCHOANALYTIC THEORY
e.g. Haire project Technique – Experiment of 1940 ‘why women reluctant to purchase instant coffee’
2 shopping lists – 1st regular & 2nd …. Instant,Respondents (housewives) asked to project the type of woman most likely to have developed each list. List with instant coffee => lazy & poor planner.
‘Deep - Seated fear out of a concern that their husbandswould feel that women were avoiding their traditional roleas homemakers.’
Hence the instant coffee was advertised in family sitying situationwith the husband’s approval
p.s. – this was later developed as Motivational Research study
195CB
MS7
PT 3: SOCIAL THEORY – Karen Horny
Freaud’s disciples shifted due to…
1) Social variable {than biological} are more important
2) Conscious motives are more important than unconscious
3) Behavior is most frequently directed to known needs & wants
196CB
MS7
KAREN HORNY’S THEORY Personality is developed as an individual learns to cope withbasic anxieties, steaming from parent-child relationship.Hence three approaches, two coping with anxieties
1) Compliance……. Moving towards people
2) Aggressiveness…. Moving against people
3) Detachment…. Moving away from people
Later COHEN developed CAD scale using thirty five iteminventory. COHEN found…
1) Compliance type use more soaps, mouthwash, aspirin
2) Aggressiveness type use more cologne, aftershave, deodorant & van Heusen shirts
3) Detachment types use more tea but less beer
197CB
MS7
PT 4: SELF CONCEPT THEORY
Individuals have concept of self based on who they think
They are and a concept of the ideal self based on who they
think they would like to be.
Q1> consumers are asked to describe how they see
themselves as say happy, serious, modern,
practical etc
Q2> consumers to tell which of the items describe how
they would like to be
{Women who would like to be modern & efficient tend to buy different
brands, tend to shop different stores than the warm/attractive woman.}
Part 2 Individual Consumer concluded
198CB
MS7
Consumers buy brands that are perceived as similar to theirself image, either actual or ideal so that there is congruencebetween brand image & self image
SELF CONCEPT THEORY