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Chapter 3 Analyzing Consumer Markets

Chapter 3 focuses on analyzing consumer markets by exploring factors that influence customer behavior, the five-stage model of the buying decision process, and behavioral decision theory. It discusses cultural, social, and personal factors that affect consumer choices, as well as key psychological processes like motivation, perception, and learning. The chapter emphasizes the importance of understanding consumer behavior for effective marketing strategies.

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Lilli Park
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0% found this document useful (0 votes)
11 views67 pages

Chapter 3 Analyzing Consumer Markets

Chapter 3 focuses on analyzing consumer markets by exploring factors that influence customer behavior, the five-stage model of the buying decision process, and behavioral decision theory. It discusses cultural, social, and personal factors that affect consumer choices, as well as key psychological processes like motivation, perception, and learning. The chapter emphasizes the importance of understanding consumer behavior for effective marketing strategies.

Uploaded by

Lilli Park
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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CHAPTER 3

ANALYZING
CONSUMER
MARKETS
KNOWLEGDE
OBJECTIVES
1. Understand the factors that influence customer behavior
2. Explain the 5-stage model of customer buying decision
3. Describe some behavioral decision theory

1. Classify factors affecting customer behavior


SKILL

2. Apply the Five-Stage in analyzing customer


ATTITUDE

1. Have an active and positive attitude in class


2. Realize the importance of getting to know customers
TABLE OF CONTENTS
1 What Influences Consumer Behavior?

2 Key Psychological Processes

3 The Buying Decision Process:


The Five-Stage Model

4 Behavioral Decision Theory and


Behavioral Economics

5 Debates & discussions


1
What Influences
Consumer
Behavior?
Customer
GAME 1:
I want
__________________ LUCKY
__________________
__________________
Business
We offer
__________________
__________________
__________________
1. WHAT INFLUENCES CONSUMER BEHAVIOR?

Right way

Successful marketing requires that


companies fully connect with their customers
Definition of Consumer Behavior

select of goods,
individuals
buy services,
groups
use ideas,
organizations
and dispose or experiences

to satisfy their needs and wants.


What factors influence you when
you decide to buy an item?

E.g: My friend advise me


1. WHAT INFLUENCES CONSUMER BEHAVIOR?
1.1

Cultural Factors
Culture is the fundamental determinant of a person’s wants
and behaviors acquired through socialization processes with
family and other key institutions.
Each culture consists of smaller subcultures that provide
more specific identification and socialization for their
members.
Components Of Subcultures

Nationalities Religions Racial groups Geographic


regions
Social classes are relatively SOCIAL
homogenous (đồng nhất) and enduring
(lâu dài) divisions in a society, CLASSES
hierarchically ordered and with
members who share similar values,
interests, and behavior.
Upper uppers
SOCIAL
Lower uppers
CLASSES
Upper middles

Middle class

Working class

Upper lowers

Lower lowers
Characteristics Of Social Classes

1. Within a class, people tend to behave alike


2. Social class conveys perceptions of inferior or superior position
3. Class may be indicated by a cluster of variables (occupation,
income, wealth)
4. Class designation is mobile over time
1.2

Social Factors

a. Reference
groups

c. Roles &
b. Family
status
1.2

Social Factors
Primar nal groups
y group Aspiratio
Reference s
Groups

ary groups Dissoci


Second ative g
roups

Membership group
1.2

Social Factors
The family is the most important consumer
Family buying organization in society, and family
members constitute the most influential
primary reference group.
There are two families in the buyer’s life:
▻The Family of Orientation consists of
parents and siblings
▻The Family of Procreation consists of
one’s spouse and children.
1.2
Social Factors

A Role consists of
activities a person is
expected to perform.
Roles & Status
Each role carries a status.
1.3
Personal Factors

Age and stage in Personality & self-


the life cycle concept

Occupation &
economic Lifestyle & values
circumstances
Age and stage in the life cycle
The Family Life Cycle
OCCUPATION AND ECONOMIC CIRCUMSTANCES

1. Occupation also influences consumption patterns:


▻A working-class worker will buy work clothes, work
shoes and lunchboxes.
▻A company executive will buy suits, air travel, country
club memberships.
2. Economic circumstances: influences the consumer’s product
choice:
▻Luxury-goods makers such as Gucci, Prada, and
Burberry can be vulnerable to an economic downturn.
Personality And Self-concept
Each person has personality characteristics that
influence his/her buying behavior.
▻Personality: a set of distinguishing human
psychological traits that lead to relatively
consistent and enduring responses to
environmental stimuli.
▻Personality can be an useful variable in
analyzing consumer brand choices.
▻The idea is that brands also have
personalities and consumers are likely to
choose brands whose personalities match
their own.
TYPICAL PERSONALITIES

Self-confidence Dominance

Adaptability Autonomy

Defensiveness Deference

Sociability
PERSONAL FACTORS – SELF-CONCEPT

Self-concept: how we view


ourselves
Consumers often choose and use
brands that have a brand
personality consistent with:
▻Their own actual self-concept.
▻Their ideal self-concept (how
we would like to view ourselves).
▻Other’s self-concept (how we
think other see us).
A lifestyle is a person’s pattern of
living in the world as expressed in
Activities, Interests, and Opinions. It
Lifestyle portrays the “whole person” interacting
& with his environment.
Values
Marketers search for the relationships
between their products and lifestyle
groups (LOHAS products)
Money-constrained

Lifestyle
&
Values

Time-constrained
CORE VALUES

1. Core values are the belief systems that underlie attitudes


and behaviors.
2. Core values go much deeper than behavior or attitude and
determine, at a basic level, people’s choices and desires
over the long term.
3. Marketers who target consumers on the basis of their
values believe that with appeals to people’s inner selves, it
is possible to influence their outer selves -their purchase
behavior.
I often buy toothbrush packs sold in combos to
give to my husband and children. What factors
1
influenced buying behavior in this case?
a. Social

b. Cultural

c. Life Cycle

d. Motivation
Life style and occupation are belongs to 2
a. Psycological

b. Cultural

c. Social

d. Personal
A company executive will buy suits, air travel,
country club memberships.
3
a. Occupation

b. Sub culture

c. Personal

d. Beliefs
I bought it many times because I know it's a
quality product and I did a lot of research
about it
4
a. Sub culture

b. Personal

c. Beliefs

d. Learning
SUM UP

1. WHAT INFLUENCES CONSUMER BEHAVIOR?


2
Key
Psychological
Processes
2. KEY PSYCHOLOGICAL PROCESSES

Figure 6.1 Stimulus-response Model of Consumer Behavior


2. KEY PSYCHOLOGICAL PROCESSES

Motivation Perception Learning Memory


2.1
Motivation

Sigmund Freud Abraham Maslow Frederick Herzberg


(1856 - 1939) (1908 – 1970) (1923 – 2000)
Unconscious Theory Hierarchy of Needs Two-Factor Theory

Behavior is guided Behavior is driven Behavior is guided


by subconscious by the lowest, by motivating and
motivation unmet need hygiene factors
Freud’s
Theory

1. Psychological forces shaping people’s behavior are largely


unconscious, and that a person cannot fully understand his or
her own motivations.
2. Motivation researchers often collect “in-dept interviews” with a
few dozen consumers to uncover deeper motives triggered by a
product.
3. The popular technique:
▻Laddering
▻Projective techniques: word association, sentence
completion, picture interpretation, role playing….
Maslow’s Hierarchy of Needs
Herzberg’s Two-Factor Theory
2.2
Perception
1. A motivated person is ready to act.
2. How she acts is influenced by her view of situation.
3. Perception is the process by which we select, organize, and
interpret information inputs to create a meaningful picture of the
world.
4. The key point is that it depends not only on the physical stimuli,
but also on the stimuli’s relationship to the surrounding field and
on conditions within each of us.
▻A fast-talking salesperson is perceived as aggressive and
insincere by one person, but intelligent and helpful by another.
Three Perceptual Processes

People can emerge with


different perceptions of
the same object because of
the three perceptual
processes:
▻Selective attention
▻Selective distortion
▻Selective Retention
2.3
Learning
1. When we act, we learn.
2. Learning induces changes in
our behavior arising from
experience.
3. Learning theorists believe that
learning is produced through
the interplay of drives, stimuli,
cues, responses, and
reinforcement.
Components Of Learning

Drive Reinforcement

A strong internal If the experience is


stimulus impelling rewarding, the
action Cues response will be
reinforced
Minor stimuli that
determine when,
where and a person
respond
2.4
Brand Knowledge In Memory

1. We can think of consumer brand knowledge as a node in memory


with a variety of linked associations.
2. The strengths and organization of these associations will be
important determinants of the information we can recall about the
brand.
3. Brand associations consists of brand-related thoughts, feelings,
perceptions, images, experiences, beliefs, attitudes, and so on that
become linked to the brand node.
Figure 6.3 : Hypothetical
State Farm Mental Map
An Example Of Brand Associations
The Buying Decision
3 Process: The Five-
stage Model
3. THE BUYING DECISION PROCESS

Figure 6.4 : Five-stage Model Of Consumer Buying Process


3.1
Problem Recognition
1. Internal stimulus: one of the person’s normal needs-hunger, thirst,
sex-rises to a threshold level and becomes a drive.
2. External stimulus: A person may admire a neighbor’s new car or
see a television ad for a Hawaii vacation, which triggers thought
about possibility of making a purchase.
3. Marketers need to identify the circumstances that trigger a
particular need, then develop marketing strategies that trigger
consumer interest.
3.2
Information Search

Personal Public

Sources of
Information
Commercial Experiential
3.2
Information Search

Search
Dynamics

Figure 6.5 Successive Sets Involved in Consumer Decision Making


3.3

Evaluation of alternatives
1. Through experience and learning, people
acquire beliefs and attitudes.
2. Beliefs is a descriptive thought that a
Beliefs & person holds about something.
Attitudes 3. Attitudes are a person’s enduring
favorable or unfavorable evaluations,
emotional feelings, and action tendencies
towards some object or idea.
3.4
Purchase Decision

Figure 6.6 Stages between Evaluation


of Alternatives and Purchase
3.4
Purchase Decision-intervening Factors

1. Attitudes of other:
▻The intensity of the other person’s negative attitude
toward our preferred alternative.
▻Our motivation to comply with the other person’s
wishes.
2. Unanticipated situational factors.
3. Consumer’s perceived risk.
Perceived Risk

Finding anotherproduct because of existing product’s Time risk


failure

Affecting the mental well-being of the user Psychological risk

Resulted in embarrassment from others Social risk

Not worth the price paid Financial risk

Threat to physical well-being Physical risk

Not perform up to Functional risk


expectations
3.5

Postpurchase behavior
1. Postpurchase behavior =
dissonance experience
2. Marketers must monitor:
▻Consumer’s postpurchase
satisfaction.
▻Consumer’s postpurchase
actions
▻Consumer’s Postpurchase
use and disposal
3.5
Postpurchase behavior

Use and
Disposal

Figure 6.7 How


Customers Use
and Dispose of
Products
Other Theories Of
4 Consumer
Decision Making
4.1 LEVEL OF CONSUMER INVOLVEMENT

Consumer involvement is the level of


engagement and active processing the
consumer undertake in response to a
marketing stimulus.
▻Elaboration Likelihood Model
▻Low-involvement marketing strategies
▻Variety-seeking buying behavior
4.2 DECISION HEURISTICS

Availability heuristic
Representativeness heuristic
Anchoring and adjustment
heuristic
4.3 MENTAL ACCOUNTING
Mental accounting refers to the way consumers code,
categorize, and evaluate financial outcomes of choices.
▻Individuals often segregate their savings into separate
accounts to meet different goals even though funds from
any of the accounts can be applied to any of the goals
Consumers tend to…
▻Segregate gains
▻Integrate losses
▻Integrate smaller losses with larger gains
▻Segregate small gains from large losses
4.4 PROFILING THE CUSTOMER BUYING-DECISION PROCESS
1. The marketer need to learn about the stages in the buying process
for their product by:
▻Introspective method: To think about how they themselves
would act.
▻Retrospective method: To interview a small number of recent
purchasers, asking them to recall the events leading to the
purchase.
▻Prospective method: To locate the consumers who plan to
buy the product and ask them to think out loud about going
through the buying process.
▻Descriptive method: they ask the consumers to describe the
ideal way to buy the product.
4.4 PROFILING THE CUSTOMER BUYING-DECISION PROCESS

2. Understanding the customer’s


behavior in connection with a
product has been called mapping:

▻The customer’s consumption system


▻The customer activity cycle
▻Customer senario.
5
Debate
&
Discussions
READ CASE STUDY

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