Chapter 3 - Shopper Behavior Flashcards

1
Q

Consumer motives for shopping - personal motives and social motives

A

Personal motives:

Relaxing
Role playing
Seeking variety
Seeking sensory stimulation form the retail environment

Social motives:

Social interaction away from home
Fulfilling status needs
Being with peer groups

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2
Q

Different types of shopper

Multichannel enthusiast

A

Positive attitudes towards multiple channels for searching and buying

Highly innovative people

Enjoy shopping

Show LOW loyalty

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3
Q

Different types of shopper

Uninvolved shopper

A

Not positive toward any channel of shopping

Do not enjoy shopping

Show LOW loyalty

Low price consciousness

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4
Q

Different types of shopper

Store focused shoppers

A

Favour brick and mortar stores

Negative attitudes towards any other channel except stores

They are loyal shoppers

Show little innovativeness

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5
Q

Different online shopper types

A

Credibility first purchasers - strong preference for high reputation stores

Risk averse purchasers - take a long time to decide to buy a high price item by comparing info on items in different stores

Economical purchasers - favour purchasing low price items and take a long time to decide to buy an item, they do not like to communicate with others

Active star purchasers- fond of communicating with others of their shopping experience, lots of word to mouth interaction make them most influential group

Direct purchasers - similar to economical shopper but are task orientated and do not take long to make a buying decision

High loyalty purchasers - clear preferences and add items to favourite lists, share their online experience word to mouth and they are very informed with the products and services - making them loyal customers

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6
Q

Retail outlet customer base consists of

A

Core customers: use the outlet because it is their first choice, small percentage of outlets shopper but represent most of its sales.

Secondary shoppers: use the outlet to compare price and merchandise, not necessarily the first choice outlet

Tertiary shoppers: browse the outlet occasionally but seldom make a purchase

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7
Q

Four product classes

Convenient products

A

Convenience products

  • inexpensive and purchased regularly
  • little to no comparison shopping is done
  • minimum time and effort spent on buying these

3 groups

Staples - bread
Impulse goods - magazines or sweets @ checkout
Emergency goods - suntan lotion

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8
Q

Four Product classes

Shopping Products

A
  • Cause consumers to engage in comparison process before buying
  • these cost more and bought less frequently than convenience goods

Examples - clothes, furniture

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9
Q

Four product classes

Speciality products

A

These have unique characteristics for which the consumer will not accept substitutes.

  • these consumers are well informed and make special efforts to acquire the products they want

Examples - photographic and electronic equipment and designer clothes

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10
Q

Four product classes

Unsought products

A

These are products that are either known or not known by the consumer and which they usually don’t consider buying .

Examples

New products of which the consumer was not previously aware and products like insurance which the consumer does not want immediately

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11
Q

Perceived risk and its implication for retailing

A

Perceived risk: the level of risk a consumer believes exists in respect for purchasing a specific product or service from a specific retailer.

Perceived means that is not always based on facts

Innovative outlets such as television shopping are viewed as higher risk

Traditional outlets have an advantage with high perceived risk items because their reputation and well trained sales persons are reassuring to the customer.

Financial risks can be reduced by offering guarantees and trial periods

Social risks can be reduced though a skilled sales force and established brands

Physical and functional risk can be addressed by using respected organisations as endorsers for the quality and functioning of the product.

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12
Q

Eight types of perceived risk

A

Functional risk : risk that products will not perform as expected like breaking down soon etc

Physical risk : risk to self and other that the product poses like possibility of health hazard

Financial risk : risk that product will not be worth it’s cost either in time or in money. Any possible further immediate costs to make it work properly

Social risk: risk that shopping at a specific retailer will cause embarrassment and may not meet with peer approval

Psychological risk: risk that poor product choice will risk consumers ego, where the purchase might be incompatible with consumers self image

Time loss risk: risk of spending too much or to little time on the purchasing, inconvenience or delays when product needs to be repaired or replaced

Future opportunity cost: risk that an improved or lower cost product may be available in the future
- rapid rate of new technology

Source risk: risk of trusting the retailer or organisation involved in the transaction
- relevant for online retailers

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13
Q

Factors affecting perceived risk

A

Familiarity with the product

Amount of information available

Number of alternatives available

Social visibility

Guarantees offered

Urgency of the need

Time available to shop

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14
Q

Risk relievers for consumer s

A

Seeking information from friends and family

Having brand loyalty

Obtaining expert advice

Product testing through private of gov organisations

Buying most expensive model

Seeking reassurance

Requiring guarantees

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15
Q

Retail outlet selection process for consumers

A

Same as choosing a brand

Recognises a problem 
Select an outlet 
Engages in external and internal search
Evaluates alternatives 
Then makes a decision
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16
Q

Retail outlet criteria

A

Outlet Image

Market communication of retailer s

Outlet location and size

17
Q

Retail outlet criteria - Outlet image

A

This refers to the consumers perceptions based on all the features associated with a retail outlet

Different groups of people want different things therefore a retailer must be in control of most dimensions which project a well focused image.

Examples include department stores which saw the role of being “all things for all people”

Their image became too scattered to appeal to customers.

These include rational and emotional components

Rational components include price, parking
Emotional include decor and atmospherics

18
Q

Retail outlet criteria - market communication of retailer

A

This refers to means such as advertising that retailers can use to communicate their image to customers.

Price promotions are used to draw customers to a shop. The impact varies on product category, brand and retail outlet

19
Q

Outlet location and size

A

Location of an outlet effects the consumers choice of shop. They prefer closer shops.

The size of an outlet affects this too, larger outlets are preferred unless a consumer wants fact or convenient service.

Retail gravitation model calculates shop attraction based in shop size and travel distance.

The shop size refers in square meters refers to the breadth and width of merchandise.

Travel time to a shop refers to the physical and psychological effort to visit a given retail outlet.

Product class refers to the varying travel time associated with different products

Large attraction coefficient means consumers are unwilling to travel very far for products such as convenience products

20
Q

Factors influencing in-shop behaviour

In shop information 
Shop layout 
Shop atmosphere
Sales personnel
Point of purchase displays
Product displays 
Pricing strategies and promotions 
Out of stock situations
A

In shop information - providing information to consumers may prove a big advantage if they were unaware of this info before.
They serve as an competitive technique for consumers as well.

Point of purchase displays - these attract consumer attention and impact sales positively. The use of shelf displays are strongly substantiated because the net combined display and shelf sales are well above average.

Shop layout and traffic : factors such as visibility increase the chance that a product will be purchased. Retailers study traffic patterns to determine good and bad sales areas to design optimum layout patterns for placing and spacing of products.

21
Q

Factors influencing in-shop behaviour

A

Product displays

  • factors that influence sales here are the height of the products as well as the facing (number of rows) of the products. Eye level shelf position is optimum spot because customers purchase time and amount is limited.

Pricing strategies -

retailer want to project a low price image it uses loss leaders- where products are sold at cost or slightly above cost to generate consumer traffic.

Sales increase in response to price promotions an be due to the following:

  • Stockpiling: customers buy ahead of anticipated needs
  • Switching brands: repeat buyers
  • draws new customers to buy the brand

Shop atmospherics - influence the shoppers mood and willingness to visit and browse. Attributes such as lighting, layout, sounds etc

22
Q

Factors influencing in-shop behaviour

A

Sales personell

  • often the fist point of contact with the retailer.
  • they can exercise their influence to generate consumer purchases
  • retailers consider them a priority but the high cost and turnover of sales force make retailer use self service as much as possible

Out of stock situations

When a retailer does not have stock of a certain brand they have four options:

  1. Buy same brand but at another shop
  2. Switch brands
  3. Delay purchase
  4. Cancel purchase
23
Q

Consumer behaviour under certain economic conditions:

Inflation
Stagflation
Recession
Shortages

A

Inflation:

the constant and considerable rise in prices of products and services in general, measured by the CPI.

Consumers are forced to reconsider their consumption priorities because of price increases from inflation.

Functionalism
The consumer tries to find greater value for thief reducing purchasing power.

For durable products such as furniture, consumers will pay a higher price if they perceive it to give them better service and a longer life span.

With high inflation rates use techniques such as comparative shopping to find the best value for the lowest price point.

The outcome of this is the postponement of discretionary purchases with the net result of a decrease in sales of durable products.

Consumers try and beat inflation and this behaviour might result in a further increase in inflationary demand.

24
Q

Recession

A

The aspects of a recession that affect a retailer are the decrease in the growth of employment opportunities and the growth of the unemployed.

The result of the combined influence of continuos inflation and increase number of recessions is a decline in the real income of the consumer, high unemployment rates and little consumer confidence.

This causes consumers values to change, as their purchasing behaviours

25
Q

Stagflation

A

This is the word given to the combined effects of a stagnation in production and employment as well as the increasing price inflation

26
Q

Shortages

A

Shortages of raw materials, affect the supply of products, contribute to inflation and drastic price increases, this requiring a reorientation in marketing to customers.

Does one advertise a product when availability is unknown?

27
Q

Impact of certain economic conditions on consumer behaviour

A

Consumer can do two things in periods of inflation and recession

Either increase income or modify consumption behaviour with current income.

What do consumers do?

Try to become more self sufficient

Rely more on family and friends

A shift to functionalism and value of products

Simplifying lifestyles

28
Q

4 Impulse buying forms

A

Pure impulse
- novelty purchase which breaks normal buying pattern

Reminder impulse
- a shopper sees an item and is reminded to purchase because stock at home is low or advertisement

Suggestion impulse
- shopper sees an item for the first time and visualises a need for it

Planned impulse
- shopper enters a shop with expectation and invention of making some purchases on the basis of price specials.

29
Q

Characteristics of impulse buying products

A

Typically
Low in price
Short product lifespan
Small and weigh little