© 2018 Cengage Learning.® May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

© 2018 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
2
Customer Behavior

© 2018 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 2.
 Marketing Framework

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2. 3
 Discussion Question #1

• Describe the process you used when

you decided which college to attend.

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2. 4
 The Science of Consumer Behavior

• There are known, reliable patterns that

comprise consumer behavior, including:

• The phases consumers go through when

making a purchase
• The different kinds of purchases that
consumers make
• How consumers sense and perceive,
become motivated, form attitudes, and
make decisions
• The cultural differences that influence
consumers
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2. 5
 The Purchase Process

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2. 6
 Pre-Purchase Phase

• Customers recognize a need/desire

• Some are heavily marketer influenced;
some are not
• e.g., Having trendy clothes vs. needing to eat
• Customers search and evaluate products
that address their need
• e.g., Conduct online search, ask friends, etc.
• Customers create a consideration set
• All brands considered as candidates for
purchase
© 2018 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
2. 7
 Discussion Questions #2

1. What need/desire drove you to consider

“purchasing” college?
2. How did you search for information?
3. Which colleges were in your
consideration set?
4. What criteria did you utilize to form this
set?

© 2018 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
2. 8
 Purchase Phase

• Customers narrow the consideration set

• Customer may delay the purchase
• Customer may decide not to purchase

• Customers decide on retail channel

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2. 9
 Post-Purchase Phase

• Customers assess the purchase and the

purchase process
• Customers determine satisfaction
• Did the customer get what he expected?
• Customers’ level of satisfaction leads to
• Repeat purchases
• Negative or positive word of mouth
• Product returns, etc.

© 2018 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
2. 10
 Discussion Questions #3

1. Are you satisfied with your college

decision? Why or why not?
2. Could your level of satisfaction affect
the college? If so, how?

© 2018 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
2. 11
 Who Utilizes the Purchase Process?

• Business-to-Consumer (B2C) and

Business-to-Business (B2B) both utilize
the buying process
• The amount of time spent on a stage
depends upon what is being bought
• A business customer is an agent buying
something on behalf of an organization
• e.g., Administrative assistants, operations
department, etc.

© 2018 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
2. 12
 Three Types of Consumer Purchases
(slide 1 of 2)

• Convenience purchases
• Low involvement; standard, frequently
consumed goods or impulse purchase
• Consumers don’t spend much time thinking
or planning the purchase
• Shopping purchases
• Medium involvement; not as frequently
purchased
• Consumers spend time and effort prior to
purchase

© 2018 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
2. 13
 Three Types of Consumer Purchases
(slide 2 of 2)

• Specialty purchases
• High involvement; occasional purchases,
often more expensive, require more thought
• Customers put much effort into the purchase

© 2018 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
2. 14
 Types of Business Purchases

• Straight rebuy
• Low involvement; purchase what was
purchased last time with little or no thought
• Modified rebuy
• Medium involvement; something about the
purchase is altered requiring some thought
• New buy
• High involvement; purchase something that
hasn’t been purchased before requiring
much thought and planning
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2. 15
 Types of Purchases

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2. 16
 Low-Involvement Purchases

• Low-involvement purchases
• Have more price sensitivity
• Use price discounts
• Generally don’t generate word of mouth
• Are usually distributed intensively
• Marketers should focus on how to capture
consumers’ attention

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2. 17
 High-Involvement Purchases

• High-involvement purchases
• Have less price sensitivity
• Use brand communities and events
• May generate word of mouth
• Are usually distributed selectively
• Marketers should focus on providing
consumers with information

© 2018 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
2. 18
 Anatomy of a Grocery Store

• Layout of a grocery store encourages

purchases
• Group similar products
• Group complementary products
• Place common purchases far from the
entrance
• Group products to form consideration sets
• Place high-profit and impulse-purchase
items at end of aisles and checkout lanes

© 2018 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
2. 19
 Sensation and Perception
(slide 1 of 5)

• Utilize senses to convey information

• Consumers have selective attention;
they block out what is not relevant
• Visual: colors can convey
• Product characteristics (white for freshness
for toothpaste)
• Brand identity (Tiffany’s aqua blue)
• Meaning (affected by culture)

© 2018 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
2. 20
 Sensation and Perception
(slide 2 of 5)

• Hearing can
• Increase spending
• e.g., Quick tempo music = increased spending
• Convey a brand
• e.g., Harley-Davidson’s distinctive sound
• Smell can
• Get attention
• e.g., Smelling the Cinnabon store
• Allow product sampling
• e.g., Perfume in magazines

© 2018 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
2. 21
 Sensation and Perception
(slide 3 of 5)

• Taste can
• Distinguish one brand from another
• e.g., Coke vs. Pepsi
• Touch can
• Convey brand imagery
• e.g., Well-designed products compared to
value designed products
• e.g., Ergonomics, clean lines, simplicity,
beauty, and sensual experiences

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2. 22
 Sensation and Perception
(slide 4 of 5)

• Subliminal
advertising
• An ad that is
shown so quickly
that is doesn’t
meet the
threshold of
liminal recognition
• Has been
debunked by
research
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2. 23
 Sensation and Perception
(slide 5 of 5)

• Mere exposure
• Repeated exposure to an ad brings
familiarity and a positive feeling

• Perceptual fluency
• Customers may pay the most attention to
the content of a message
• However, the colors, font, etc. make a brand
impression as well

© 2018 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
2. 24
 Learning, Memory, and Emotions

• Sensory and perceptual impressions can

become brand associations
• Learning is the process by which
associations get past the sensory and
perception stages into short-term
memory and then, with repetition and
elaboration, into long-term memory
• Classical and operant conditioning

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2. 25
 Classical Conditioning
(slide 1 of 2)

• Pavlov’s dogs
• Stage 1: a dog drools at sight of food
• Stage 2: a dog doesn’t respond to a bell
• Stage 3: ringing a bell while placing food in
front of the dog elicits drool
• Stage 4 (occurs over time): a bell rung in
front of the dog elicits drool
• A similar process can be used in
advertising and jingles

© 2018 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
2. 26
 Classical Conditioning
(slide 2 of 2)

• Companies may have negative brand

associations in customers’ memories

• Some companies change names to help

create new associations
• e.g., Philip Morris is now Altria
• e.g., ValuJet is now AirTran

© 2018 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
2. 27
 Discussion Question #4

• Use classical conditioning theory to

explain this advertisement.

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2. 28
 Operant Conditioning

• Skinner used pigeons to show that

learning occurs by positively reinforcing
behavior
• Fixed ratio reward: reward is given every
time or every 4th time, etc.
• Variable ratio reward: reward timing varies
unpredictably
• Subject will engage in the behavior more
often if rewarded on the variable schedule

© 2018 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
2. 29
 Discussion Questions #5

1. Discuss how a deli could utilize operant

conditioning to design a loyalty program
under
• fixed ratio reward, and
• variable ratio reward
2. Which reward ratio do you think would
be more effective and why?

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2. 30
 Motivation: Hierarchy of Needs

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2. 31
 Maslow’s Hierarchy of Needs
(slide 1 of 2)

• Maslow suggests that people must have

their basic needs met before moving on
to more abstract needs

• Marketers may identify their product with

one of Maslow’s needs
• e.g., Volvo and safety needs
• Many brands are associated with a sense of
belonging, social acceptance, and respect

© 2018 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
2. 32
 Maslow’s Hierarchy of Needs
(slide 2 of 2)

• Marketers may identify products with

aspiration groups
• Marketers may offer an extended brand
line for customers at different levels in
Maslow’s hierarchy
• e.g., Mercedes has a lower-end C model,
then upward to E, S, and finally CL models
• Marketers use hierarchy for positioning

© 2018 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
2. 33
 Distinguishing Motivations

• Utilitarian vs. hedonic

• e.g., Suit for interviews vs. Armani suit
• Conformity vs. individuality
• May vary over lifetime or in different
situations
• Risk seeking vs. risk averse
• Risk tolerance may vary with product
knowledge

© 2018 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
2. 34
 Attitudes and Decision Making

• Attitudes and decision making influence

whether consumers
• Will buy a brand
• Repeatedly purchase it
• Become loyal
• Recommend it to others, etc.

© 2018 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
2. 35
 What Are Attitudes?

• Attitudes are a mix of beliefs and

importance weights
• Beliefs
• e.g., I think Sprite has caffeine
• Importance
• e.g., I think having caffeine is important
• Customer may differ on both importance
and beliefs

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2. 36
 Decision Making
(slide 1 of 3)

• Decision making:
• With a few choices, consumers easily
compare brands to make decision
• With many choices, consumers use two
stages:
• Stage 1: Determine consideration set
• Stage 2: Compare brands to make a
purchase decision

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2. 37
 Decision Making
(slide 2 of 3)

• Stage 1
• Non-compensatory method: if a brand
doesn’t have important attributes, it is cut
• Lexicographic method: compare all brands
on most important attribute; cut brands that
don’t have it; move on to next important
attribute and compare and cut, etc.

© 2018 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
2. 38
 Decision Making
(slide 3 of 3)

• Stage 2: Compare brands in detail

• Compensatory model (cost/benefits)
• One excellent attribute can compensate for a
poor attribute
• Some websites aid this process by allowing
users to view a side-by-side comparison of
attributes

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2. 39
 Cultural Differences

• Socio-cultural differences influence

consumers and produce shopping
patterns
• Social class
• e.g., Old-monied people seek exclusivity;
nouveaus indulge in conspicuous
consumption
• Age
• e.g., Young people buy furniture; as they get
older they buy diapers and minivans; then
college and finally healthcare
© 2018 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
2. 40
 Discussion Question #6

• How can a marketer capitalize on the

Baby Boomer segment?

© 2018 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
2. 41
 Managerial Recap
(slide 1 of 2)

• Three major phases of consumption

• Pre-purchase, purchase, post-purchase

• Three major classes of purchases

• B2C: convenience, shopping, specialty
• B2B: straight rebuy, modified rebuy, new buy
• Involvement determines class

© 2018 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
2. 42
 Managerial Recap
(slide 2 of 2)

• How do consumers think?

• Sensing and perceiving information that is
learned and stored in memory
• Motivations help marketers understand what
consumers are seeking to satisfy
• Attitudes and decision making are subject to
influence by good information and biases
• Social norms define consumers

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2. 43