CHAP 6 CONSUMER DECISION MAKING Flashcards
Marketing managers should understand consumer behavior
. services. Value is a personal assessment of the net worth one obtains from making a purchase. Purchases Marketing managers must understand these desires in order to create a proper marketing mix for a well-defined market. So it is critical that marketing managers have a thorough knowledge of consumer behavior. Consumer behavior describes how consumers make purchase decisions and how they use and dispose of the purchased goods or are made based upon perceived value, which is what you expect to get.
Components of the consumer decision-making process
Consumers generally follow the consumer decision-making process: (1) need recognition, (2) information search, (3) evaluation of alternatives, (4) purchase, and (5) post-purchase behavior.
Wants can be viewed in terms of four goals: economizing, sustaining, treating, and rewarding. If additional information is required to make a purchase decision, the consumer may engage in an internal or external information search. The consumer then evaluates the additional information and establishes purchase guidelines. Finally, a purchase decision is made.
Consumers’ post-purchase evaluation process
When buying products, consumers expect certain outcomes from the purchase. Consumer post-purchase evaluation is influenced by pre-purchase expectations, the pre-purchase information search, and the consumer’s general level of self-confidence.
Types of consumer buying decisions and consumer involvement
All consumer buying decisions generally fall along a continuum of three broad categories: routine response behavior, limited decision making, and extensive decision making. As the perceived risk in purchasing a product increases, so does a consumer’s level of involvement. The types of risks that concern consumers include financial risk, social risk, and psychological risk. The main factors affecting the level of consumer involvement are previous experience, interest, perceived risk of negative consequences (financial, social, and psychological), and social visibility. By contrast, low-involvement decisions are characterized by brand loyalty and a lack of personal identification with the product. As the perceived risk in purchasing a product increases, so does a consumer’s level of involvement. The types of risks that concern consumers include financial risk, social risk, and psychological risk. A purchase decision can be highly involved due to a wide range of factors, including product involvement, situational involvement, shopping involvement, enduring involvement, and emotional involvement
Reconceptualizing the consumer decision-making process
Rapid changes in digital technology have given consumers unprecedented power to express likes and dislikes, compare prices, find the best deals, and sift through huge numbers of recommendations on sites like Trip Advisor and Yelp and, finally, have items delivered quickly—sometimes on the same day the order was placed. . Another way firms are keeping customers in the loyalty loop is by using automated reordering. Underlying cultural, social, individual, and psychological factors strongly influence the decision process. Psychological process includes perception, motivation, and learning.
Identify and understand the cultural factors that affect consumer buying decisions
Of all the factors that affect consumer decision making, cultural factors exert the broadest and deepest influence. Marketers must understand the way people’s culture and its accompanying values, as well as their subculture and social class, influence their buying behavior. Cultural influences on consumer buying decisions include culture and values, subculture, and social class. Culture is the set of values, norms, attitudes, and other meaningful symbols that shape human behavior and the artifacts, or products, of that behavior as they are transmitted from one generation to the next. Culture is the essential character of a society that distinguishes it from other cultural groups. The underlying elements of every culture are the values, language, myths, customs, rituals, and laws that are transmitted from one generation to the next. The most defining element of a culture is its values. A culture can be divided into subcultures on the basis of demographic characteristics, geographic regions, national and ethnic background, political beliefs, and religious beliefs. A subculture is a homogeneous group of people who share elements of the overall culture as well as cultural elements unique to their own group. The United States, like other societies, has a social class system. A social class is a group of people who are considered nearly equal in status or community esteem, who regularly socialize among themselves both formally and informally, and who share behavioral norms.
Identify and understand the social factors that affect consumer buying decisions
Many consumers seek out the opinions of others to reduce their search and evaluation effort or uncertainty, especially as the perceived risk of the decision increases. Social factors include such external influences as reference groups, opinion leaders, and family. Consumers seek out others’ opinions for guidance on new products or services and products with image-related attributes or because attribute information is lacking or uninformative. Specifically, consumers interact socially with reference groups, opinion leaders, and family members to obtain product information and decision approval. Consumers may use products or brands to identify with or become a member of a group. Opinion leadership is a casual phenomenon and is usually inconspicuous. Family members also influence purchase decisions; children tend to shop in similar patterns as their parents. Social influence also plays an important role in consumer behavior especially when the consumer knows or feels that he or she is being watched.
Individual factors that affect consumer buying decisions
Individual factors that affect consumer buying decisions include gender; age and family life cycle stage; and personality, self-concept, and lifestyle. Physiological differences between men and women result in many different needs, such as with health and beauty products. Beyond obvious physiological differences, men and women differ in their social and economic roles, and that affects consumer buying decisions. A consumer’s age generally indicates what products he or she may be interested in purchasing. Marketers often define their target markets in terms of family life cycle, such as “young singles,” “young married couples with children,” and “middle-aged married couples without children.” Finally, certain products and brands reflect consumers’ personality, self-concept, and lifestyle.
Psychological factors that affect consumer buying decisions
An individual’s buying decisions are further influenced by psychological factors: perception, motivation, and learning. These factors allow consumers to interact with the world around them, recognize their feelings, gather and analyze information, formulate thoughts and opinions, and take action. Perception allows consumers to recognize their consumption problems. Motivation is what drives consumers to take action to satisfy specific consumption needs. Almost all consumer behavior results from learning, which is the process that creates changes in behavior through experience and practice.
