2. Objectives
After studying this chapter you should be able to
After studying this chapter you should be able to
explain.
explain.
How consumers make purchase decisions.
How consumers make purchase decisions.
Factors affecting consumer buying
Factors affecting consumer buying
behavior.
behavior.
Consumer buying decision process
Consumer buying decision process
Buyer Buying Behavior.
Buyer Buying Behavior.
3. Consumer Buying Behavior (definitions)
Consumer buying behavior refers to
Consumer buying behavior refers to
the buying behavior of final
the buying behavior of final
consumers – individuals and
consumers – individuals and
households who buy goods and
households who buy goods and
services for personal consumption.
services for personal consumption.
…
…the decision process and physical
the decision process and physical
activity individuals engage in when
activity individuals engage in when
evaluating, acquiring, using, or
evaluating, acquiring, using, or
disposing of goods and services.
disposing of goods and services.
4. Geographic Distribution
What is the application for geo demographic
What is the application for geo demographic
and demographic markets ?
and demographic markets ?
The Rural Population
The Rural Population
The Urban Population
The Urban Population
Consumer Demographics
Consumer Demographics
• Age
• Gender
• Education
• Income
• Race &Ethnicity
5. An ethnic group or ethnicity is a
An ethnic group or ethnicity is a
population group whose members identify
population group whose members identify
with each other on the basis of common
with each other on the basis of common
nationality or shared cultural traditions
nationality or shared cultural traditions
The term race refers to the concept of
The term race refers to the concept of
dividing people into populations or
dividing people into populations or
groups on the basis of various sets of
groups on the basis of various sets of
physical characteristics
physical characteristics
6. According to one research mostly people are spending their
According to one research mostly people are spending their
disposable income on various products % wise as under:
disposable income on various products % wise as under:
FOOD-------------------------------------- 04.4%
FOOD-------------------------------------- 04.4%
HOUSING--------------------------------- 28.9 %
HOUSING--------------------------------- 28.9 %
CLOTHING ------------------------------- 10.4%
CLOTHING ------------------------------- 10.4%
MEDICAL CARE------------------------- 06.8 %
MEDICAL CARE------------------------- 06.8 %
READING--------------------------------- 00.9%
READING--------------------------------- 00.9%
EDUCATION------------------------------ 01.1%
EDUCATION------------------------------ 01.1%
TRANSPORTATION-------------------- 15.1%
TRANSPORTATION-------------------- 15.1%
TOBACCO--------------------------------- 01.8%
TOBACCO--------------------------------- 01.8%
BEVERAGES------------------------------ 01.5%
BEVERAGES------------------------------ 01.5%
PERSONAL CARE----------------------- 02.9%
PERSONAL CARE----------------------- 02.9%
RECREATION----------------------------- 04.0%
RECREATION----------------------------- 04.0%
OTHERS----------------------------------- 02.2%
OTHERS----------------------------------- 02.2%
8. Buyer Decision Making Process
The consumers make buying decisions
The consumers make buying decisions
through five stages, such as:
through five stages, such as:
1.
1. Need recognition,
Need recognition,
2.
2. Identification of alternatives,
Identification of alternatives,
3.
3. Evaluation of alternatives,
Evaluation of alternatives,
4.
4. Purchase decisions,
Purchase decisions,
5.
5. And Post purchase behavior.
And Post purchase behavior.
9. Need recognition:
Need recognition:
First of all a consumer recognizes his/ her
First of all a consumer recognizes his/ her
need and problems.
need and problems.
Everyone has unsatisfied needs that create
Everyone has unsatisfied needs that create
discomfort.
discomfort.
These needs can be satisfied by acquiring
These needs can be satisfied by acquiring
and consuming goods and services.
and consuming goods and services.
Thus the process of deciding what to buy
Thus the process of deciding what to buy
begins when need is existing to be
begins when need is existing to be
addressed.
addressed.
10. •Once a need has been recognized the consumer
must find all the alternatives to satisfy that need.
• First alternative products and then alternative
brands.
•The means to search info. might be;
reading written materials (News paper, books)
talking to people (friends or existing users)
commercial ( TV channels)
Web sites
Identifications of alternatives/
Information search:
11. When an information of alternatives has been stored, the
When an information of alternatives has been stored, the
consumer must evaluate by some criteria such as the;
consumer must evaluate by some criteria such as the;
alternative’s reliability,
alternative’s reliability,
manufacturing,
manufacturing,
warranties,
warranties,
Price,
Price,
Resale price,
Resale price,
Workshops,
Workshops,
Product image,
Product image,
features and benefits
features and benefits
.
.
Evaluation of alternatives:
12. In this stage the consumer after evaluation of
In this stage the consumer after evaluation of
alternatives will decide to buy the best one alternative
alternatives will decide to buy the best one alternative
product, which fulfills his her needs.
product, which fulfills his her needs.
In executing a purchase intention, the consumer may
In executing a purchase intention, the consumer may
make up to five sub decisions:
make up to five sub decisions:
Brand: A
Brand: A
Dealer: 2
Dealer: 2
Quantity: 1
Quantity: 1
Timing: weekend
Timing: weekend
Payment method: credit card
Payment method: credit card
Purchase decisions:
13. At the end the consumer takes further action after
At the end the consumer takes further action after
purchasing of the chosen alternative to know whether
purchasing of the chosen alternative to know whether
the taken decision is correct or not.
the taken decision is correct or not.
If the consumer is satisfied will by again.
If the consumer is satisfied will by again.
May decide to buy later on
May decide to buy later on
On the other hand if dissatisfaction…….
On the other hand if dissatisfaction…….
Post purchase behavior:
15. LEVEL OF INVOLVEMENT:-
LEVEL OF INVOLVEMENT:-
The amount of effort expended or put up in satisfying a
The amount of effort expended or put up in satisfying a
need, that may be high involvement or low involvement
need, that may be high involvement or low involvement
products.
products.
LOYALTY:-
LOYALTY:-
Loyal to a brand or retailer due to past purchase and may
Loyal to a brand or retailer due to past purchase and may
result in low involvement how ever product may be
result in low involvement how ever product may be
important to customer.
important to customer.
IMPULSE BUYING:-
IMPULSE BUYING:-
Purchasing with a low or no advance planning results in
Purchasing with a low or no advance planning results in
low involvement; increasing day by day due to catchy
low involvement; increasing day by day due to catchy
displays and packaging.
displays and packaging.
16. 1- INFORMATION & PURCHASE DECISION
a)
a) Commercial Information Environment :-
Commercial Information Environment :-
The marketing organization and the individuals i.e.
The marketing organization and the individuals i.e.
manufacturer, retailer, sale people, websites, telemarketers,
manufacturer, retailer, sale people, websites, telemarketers,
and most important single source is advertising.
and most important single source is advertising.
b)
b) Social Information Environment :-
Social Information Environment :-
Family
Family
Friends
Friends
Acquaintances (colleagues, class fellows, neighbors
Acquaintances (colleagues, class fellows, neighbors
etc.)
etc.)
Word of mouth conversation, chat rooms or internet
Word of mouth conversation, chat rooms or internet
and observing other by using products
and observing other by using products
17. Definitions of Culture
The complete whole that includes
The complete whole that includes
knowledge , belief, art, morals, law,
knowledge , belief, art, morals, law,
customs and any other capabilities
customs and any other capabilities
and habits acquired by man as a
and habits acquired by man as a
member of society (Loudon)
member of society (Loudon)
Culture is sum total of learned beliefs ,
Culture is sum total of learned beliefs ,
values and customs that serve to direct
values and customs that serve to direct
the consumer behavior of members of
the consumer behavior of members of
a particular society(Kanuk)
a particular society(Kanuk)
18. CULTURAL FACTOR
CULTURAL FACTOR
Cultural factor is set of basic values,
Cultural factor is set of basic values,
traditions, customs, norms,
traditions, customs, norms,
perception, beliefs exerts the broadest
perception, beliefs exerts the broadest
and the best influence on consumer
and the best influence on consumer
behavior.
behavior.
Consumer makes any decision in the
Consumer makes any decision in the
prospective of their forefather culture.
prospective of their forefather culture.
19. What is culture?
How we think, eat, dress, sleep, talk, and express our values
How we think, eat, dress, sleep, talk, and express our values
Language (silent language of gestures & posture)
Language (silent language of gestures & posture)
Symbols
Symbols
Rituals
Rituals
Art
Art
Law
Law
Artifacts
Artifacts
Knowledge
Knowledge
Food and food customs
Food and food customs
Technology
Technology
Work patterns
Work patterns
products
products
Drama
Drama
Music
Music
Brain-ware of soft-ware
Brain-ware of soft-ware
It gives the society its distinctive flavor
It gives the society its distinctive flavor
Culture is a society’s personality
Culture is a society’s personality
We cannot define its exact boundaries
We cannot define its exact boundaries
20. Cultural customs & beliefs are
shared
Beliefs, values and practices must be shared
Beliefs, values and practices must be shared
It links together the members of a society
It links together the members of a society
Family serves as primary source of learning
Family serves as primary source of learning
culture and norms, rituals and values
culture and norms, rituals and values
Educational institutions also transfer culture
Educational institutions also transfer culture
Religious institutions serve as learning centers
Religious institutions serve as learning centers
It passes on from generation to generation
It passes on from generation to generation
21. Values & Beliefs (Kanuk)
Belief
Belief and
and values
values component refer to “ accumulated feeling
component refer to “ accumulated feeling
and priorities that individuals have about “things” and
and priorities that individuals have about “things” and
possessions”.
possessions”.
Beliefs consists of mental or verbal statements and reflects a
Beliefs consists of mental or verbal statements and reflects a
person particular knowledge and assessment of something
person particular knowledge and assessment of something
another ( person , brand or store )
another ( person , brand or store )
Values
Values also are
also are beliefs
beliefs how ever they are more general and
how ever they are more general and
beliefs are bit specific
beliefs are bit specific
Values & beliefs
Values & beliefs are mental images that affect a wide range of
are mental images that affect a wide range of
specific attitude
specific attitude
Cultural Values :
Cultural Values :A widely held belief or sentiment that some
A widely held belief or sentiment that some
activities , relationships , feelings or goals are important to the
activities , relationships , feelings or goals are important to the
community identity or well-being
community identity or well-being
22. Values & Beliefs (Kanuk) cont.
Values are:
Values are:
They are enduring and difficult to change
They are enduring and difficult to change
Values differ from other beliefs they are relatively few in
Values differ from other beliefs they are relatively few in
numbers
numbers
They serve as a guide culturally appropriate behavior
They serve as a guide culturally appropriate behavior
They are not tied to objects and situations
They are not tied to objects and situations
They are widely accepted by society
They are widely accepted by society
General values
General values of a person could be about a Perception of quality
of a person could be about a Perception of quality
, workmanship, status , design and aesthetics over all(about all
, workmanship, status , design and aesthetics over all(about all
cameras)
cameras)
Beliefs
Beliefs are bit specific could be about Perception of quality ,
are bit specific could be about Perception of quality ,
workmanship, status , design and aesthetics of certain (Nikon)
workmanship, status , design and aesthetics of certain (Nikon)
Camera
Camera
Taboos :
Taboos : Prohibitions in a culture , relating to various things such
Prohibitions in a culture , relating to various things such
as the use of color phrase or symbol
as the use of color phrase or symbol
23. SOCIAL FACTOR
SOCIAL FACTOR
In addition to cultural factor, a
In addition to cultural factor, a
consumer behavior is influenced by
consumer behavior is influenced by
social factors as:
social factors as:
Culture
Culture
Subculture
Subculture
Reference groups
Reference groups
Family
Family
Household
Household
24. 2- SOCIAL INFLUENCES:-
Experience needs, considering alternatives and evaluation
Experience needs, considering alternatives and evaluation
are affected by social forces
are affected by social forces
i)
i) Culture:-
Culture:-
It is a set of symbols and artifacts created by a society
It is a set of symbols and artifacts created by a society
and handed down from generation to generation as
and handed down from generation to generation as
determinants and regulator of human behaviors.
determinants and regulator of human behaviors.
Symbol may be tangible e.g. Tools, housing, products
Symbol may be tangible e.g. Tools, housing, products
etc. or intangible e.g. attitudes, believes, values, etc.
etc. or intangible e.g. attitudes, believes, values, etc.
Culture is dynamic and shared beliefs
Culture is dynamic and shared beliefs
25. 2- SOCIAL INFLUENCES:-
Some Trends in USA
Some Trends in USA
Time is money
Time is money
Over committed
Over committed
Need for day Care centers and pre schools
Need for day Care centers and pre schools
Gender Roles are loosing their identities
Gender Roles are loosing their identities
Subcultures
Subcultures
Groups with in a culture but sufficiently different on the
Groups with in a culture but sufficiently different on the
basis of Race, Nationality, Religion and Urban- Rural
basis of Race, Nationality, Religion and Urban- Rural
identification
identification
26. iii) Social Classes:
iii) Social Classes:
Ranking with in a society determined by the members of the
Ranking with in a society determined by the members of the
society
society
UPPER
UPPER Upper-Upper
Upper-Upper Upper-Middle
Upper-Middle Upper-Lower
Upper-Lower
MIDDLE
MIDDLE Middle-Upper Middle-Middle
Middle-Upper Middle-Middle Middle-Lower
Middle-Lower
LOWER
LOWER Lower-Upper Lower-Middle
Lower-Upper Lower-Middle Lower-Lower
Lower-Lower
Classifying people by education, Occupation and type of residential
Classifying people by education, Occupation and type of residential
neighborhood.
neighborhood.
A five Class Model In USA
A five Class Model In USA
The Upper Class
The Upper Class
The Upper Middle Class
The Upper Middle Class
The Lower Middle Class
The Lower Middle Class
The Upper Lower Class
The Upper Lower Class
The Lower Lower Class
The Lower Lower Class
27. iv)
iv) Reference Group:-
Reference Group:-
They share a same frame of reference
They share a same frame of reference
Families and circle of friends.
Families and circle of friends.
Personal advice is more important as compared to advertising
Personal advice is more important as compared to advertising
Celebrities, athletes, models can influence people who associate
Celebrities, athletes, models can influence people who associate
themselves with them.
themselves with them.
v
v)
) Families and Households :
Families and Households :-
-
Family is a group of two or more people related by blood,
Family is a group of two or more people related by blood,
marriage or adoption living together in a house hold.
marriage or adoption living together in a house hold.
A person may belong to at least two families; one where he was
A person may belong to at least two families; one where he was
born and other where they get married
born and other where they get married
House Hold consist of single person a family or any group of
House Hold consist of single person a family or any group of
unrelated person who occupied a housing unit.
unrelated person who occupied a housing unit.
28. Reference groups:-
Reference groups:-
Person with reference groups who, because of social
Person with reference groups who, because of social
skills, knowledge, personality, or other characteristics
skills, knowledge, personality, or other characteristics
exerts influence on others.
exerts influence on others.
Any group whose qualities a person admires can
Any group whose qualities a person admires can
serve as a REFERENCE.
serve as a REFERENCE.
For example; the physically fit, the socially
For example; the physically fit, the socially
conscious, and company employees have all served as
conscious, and company employees have all served as
reference group in advertising.
reference group in advertising.
Mostly people those admire any TV performer or any
Mostly people those admire any TV performer or any
celebrity while selecting any product more likely to
celebrity while selecting any product more likely to
be influenced by word- of- mouth info. of them.
be influenced by word- of- mouth info. of them.
29. Families and Households
Families and Households
A
A FAMILY
FAMILY is group of two or more people related by blood,
is group of two or more people related by blood,
marriage, or adoption living together in a household.
marriage, or adoption living together in a household.
Family members can strongly influence buying behavior.
Family members can strongly influence buying behavior.
The family is the most important consumer buying
The family is the most important consumer buying
organization in society.
organization in society.
Family members influence buying decisions.
Family members influence buying decisions.
In joint families, the influence of grandparents on major
In joint families, the influence of grandparents on major
purchase decision, and to some extent on the lifestyles of the
purchase decision, and to some extent on the lifestyles of the
younger generations.
younger generations.
.
.
30. 3) PSYCHOLOGICAL FACTORS:-
Perception, Learning, Attitude, Personality and
Perception, Learning, Attitude, Personality and
Self Concept.
Self Concept.
i)
i) Motivation (the starting point)
Motivation (the starting point)
Why a person acts at all in order to fulfill a need
Why a person acts at all in order to fulfill a need
Motive is a need that is sufficiently stimulated to
Motive is a need that is sufficiently stimulated to
move an individual to seek satisfaction
move an individual to seek satisfaction
31. a)
a) HIERARCHY OF NEED THEORY
HIERARCHY OF NEED THEORY:-
:-
Given By Abraham Maslow
Given By Abraham Maslow
Majority and not all need on a particular level must be satisfied well before person is motivated at
Majority and not all need on a particular level must be satisfied well before person is motivated at
next higher level.
next higher level.
32. ii) PERCEPTION:-
ii) PERCEPTION:-
It is process of receiving, organization and assigning
It is process of receiving, organization and assigning
meaning to information or stimuli detected by our five
meaning to information or stimuli detected by our five
senses
senses
Perception depends on object and experience, receiving
Perception depends on object and experience, receiving
information and comparing with huge store of images in
information and comparing with huge store of images in
memory e.g. scents (aroma) are powerful triggers
memory e.g. scents (aroma) are powerful triggers
i)
i) Selective Perception:-
Selective Perception:-
Only those stimuli which are powerful enough to capture
Only those stimuli which are powerful enough to capture
our attention have potential to being perceived
our attention have potential to being perceived
ii)
ii) Selective Distortion:-
Selective Distortion:-
Compare new information with existing store of
Compare new information with existing store of
knowledge; if there is inconsistency the new information is
knowledge; if there is inconsistency the new information is
distorted to confirm to the established beliefs.
distorted to confirm to the established beliefs.
iii)
iii) Selective Retention:-
Selective Retention:-
We retain only part of selectively perceived things.
We retain only part of selectively perceived things.
33. iii)
iii) LEARNING
LEARNING
Learning us changes in behavior resulting from
Learning us changes in behavior resulting from
observations and experiences
observations and experiences
Stimulus Response Theory (SR Theory) says that
Stimulus Response Theory (SR Theory) says that
learning occur as a person respond to some
learning occur as a person respond to some
stimulus by behaving in a particular way and is
stimulus by behaving in a particular way and is
rewarded for a correct response or penalized for an
rewarded for a correct response or penalized for an
incorrect one.
incorrect one.
When behavior pattern is established it becomes a
When behavior pattern is established it becomes a
habit and skips many steps in buying process.
habit and skips many steps in buying process.
34. Personality and self-concept:-
Personality and self-concept:-
Each person’s distinct personality influences his or
Each person’s distinct personality influences his or
her buying behavior.
her buying behavior.
Personality is usually described in terms of traits such
Personality is usually described in terms of traits such
as self-confidence, dominance, sociability, autonomy,
as self-confidence, dominance, sociability, autonomy,
defensiveness, adoptability, and aggressiveness.
defensiveness, adoptability, and aggressiveness.
35. Personality and self-concept:
A person’s these distinguishing characteristics lead to
A person’s these distinguishing characteristics lead to
relatively consistent and lasting responses to his or her own
relatively consistent and lasting responses to his or her own
environment.
environment.
Generally people buying choice or preferences are different
Generally people buying choice or preferences are different
based on their personality.
based on their personality.
It is observed / discovered that social people like coffee
It is observed / discovered that social people like coffee
and spend time in coffee houses where they can relaxed
and spend time in coffee houses where they can relaxed
and socialize over a cup of steaming coffee.
and socialize over a cup of steaming coffee.
It is an individual’s patterns of traits that influence
It is an individual’s patterns of traits that influence
behavioral response. e.g. self confident, flexible personality
behavioral response. e.g. self confident, flexible personality
etc
etc
Personality is reflected by the clothes people wear, cars
Personality is reflected by the clothes people wear, cars
they drive and restaurant they eat at.
they drive and restaurant they eat at.
36. SELF CONCEPT
SELF CONCEPT
Your Self concept or Self
Your Self concept or Self
Image is the way you see
Image is the way you see
your self.
your self.
Constitute of Actual Self
Constitute of Actual Self
Concept; the way you see
Concept; the way you see
yourself and an Ideal Self
yourself and an Ideal Self
Concept is the way you
Concept is the way you
would like to see your
would like to see your
self. Social concept is the
self. Social concept is the
way people see you
way people see you
37. v)
v) ATTITUDE:-
ATTITUDE:-
An Attitude is a learned pre disposition
An Attitude is a learned pre disposition
to respond to an object or class of
to respond to an object or class of
objects in a consistently favorable and
objects in a consistently favorable and
unfavorable way
unfavorable way
38. Situational Influences
People act differently in different situations
People act differently in different situations
A temporary force (Situational influence)
A temporary force (Situational influence)
associated with immediate purchase
associated with immediate purchase
environment.
environment.
When
When consumer buy
consumer buy
Where
Where consumers buy
consumers buy
Why
Why consumers buy
consumers buy
Conditions
Conditions under which consumer buy
under which consumer buy
39. i)
i)The Time Dimension
The Time Dimension
Marketers try to answer three time related questions
Marketers try to answer three time related questions
a)
a) How is it influenced by season, week, day or hour
How is it influenced by season, week, day or hour
b)
b) What impact do past and present events have on
What impact do past and present events have on
the purchase decision?
the purchase decision?
c)
c) How much time does the consumer have to make
How much time does the consumer have to make
the purchase and consume the product?
the purchase and consume the product?
How much time consumer has to purchase ----
How much time consumer has to purchase ----
Emergence of internet
Emergence of internet
A fast food verses Restaurant is example of time
A fast food verses Restaurant is example of time
pressure
pressure
40. ii)
ii) The Surroundings
The Surroundings
Physical surroundings e.g. lighting, smell, weather, music
Physical surroundings e.g. lighting, smell, weather, music
etc
etc
Social Surroundings e.g. mix, number and action of people
Social Surroundings e.g. mix, number and action of people
iii) Terms of Purchase
iii) Terms of Purchase
Terms and conditions of transactions e.g. cash, credit or
Terms and conditions of transactions e.g. cash, credit or
Hybrid
Hybrid
Credit card and Debit cards
Credit card and Debit cards
41. iv) Consumer Moods and Motives
iv) Consumer Moods and Motives
Consumers are in temporary state when buying
Consumers are in temporary state when buying
A customer feeling ill or getting late does not wait
A customer feeling ill or getting late does not wait
Feelings like anger or excitement affect purchasing
Feelings like anger or excitement affect purchasing
Buying a T shirt in concert with the rock star’s picture will cost
Buying a T shirt in concert with the rock star’s picture will cost
higher but still you will purchase due to mood factor
higher but still you will purchase due to mood factor
Long term Situational Influences
Long term Situational Influences e.g. Economic
e.g. Economic
Situation
Situation
