Chapter 4: Consumers Flashcards
Model of consumer behaviour
Marketing stimuli(4 Ps) > consumer’s mind > Buyer’s response
Consumer decision making processes
Need recognition –> Information Search –> Evaluation of alternatives –> Product choice –> Post-purchase/consumption
Consumer analysis
- Aggregate (Macro) analysis
- Individual (Micro) Analysis
Aggregate (Macro) analysis
- Demographic trends: Rate of population growth, age distribution, roles of gender at workplace, income distribution, geographic centers of population
- Consumer buying trends:
Focus: Self, family, world
Consumption values: Price, value, quality
Scarce resources: Money, time, people
Individual (Micro) consumer analysis
- Personal characteristics: Age, income, gender, self- concept, personality
Rational consumers
- Clearly knows their problem
- Knows all alternatives
- Knows all criteria, compares criteria to alternatives and makes the best choice
- ie, we’re utility maximizing consumers
Three broad types of decision modes
- Utilitarian
- Mundane
- Self-expressive
Utilitarian decision modes
Driven by functionality, price, and performance
Know > Feel > Do
Mundane decision modes
Habitual purchases driven by availability
Do > know > feel
Self-expressive decision modes
Emotional and driven by relevance to self. We buy the product cause it represents who we are and we’re emotionally connected to it
Feel > Do > know
The REAL consumer
- Emotional, but also rational
- In truth, we’re lazy, we take shortcuts, and we forget
- ie, we’re boundedly rational (Rational within certain bounds)
2 Customer value motives
- Manifest motives
- Latent motives
Manifest motives
Obvious values of the product
Latent motives
Underlying values of the product like status
Understanding customer needs
Understanding consumer needs
Motivation:
- Physiological, safety, social, esteem, and self-actualization (Maslow Hierarchy of Needs)
Value Laddering
Information acquisition
- Bottom-Up
- Top-Down
- Perception
Bottom-Up
- New information, trying to make sense (Learning a new language
Top-Down
- Guided by existing knowledge in memory. (For example, failing to notice a typographical error such as the one you just passed.
Perception
Select, organize, and interpret information
Pertinence
- Situational factors: Occasion, time, pressure
- Individual differences: Level of involvement
- Product factors: Cost/investment
Evaluation of alternatives
Evaluation of alternatives
- Idea that consumers value brands based on the delivery and importance of benefits
- Value to the customers is the importance of benefit multiplied by delivery of benefits. If product has multiple benefits, use the sum of all of them
Customer aggregation process
- Linear Model
- Lexicographic
- Conjunctive
- Elimination by aspects
Linear model
Decision based on all attributes given equal weight
Lexicographic
Decision based on most important attribute, then the next if tied
Conjunctive model
Decision based on any cutoff points. Eliminate brands that do not satisfy any cutoff level.
Elimination by aspects model
Decisions are based on going from the most important attribute and eliminating brands that do not satisfy the cutoff level.
Post-purchase behaviour
- Based on consumer expectations and perceived product performance, consumers are either satisfied, dissatisfied, or experience cognitive dissonance
- Is it a relationship or purely transactional, is it a long-term partnership or not (Customer loyalty)
Business Market: Overview
Compared to consumers, business markets have:
- Fewer numbers but more volume
- Geographical concentration
- More complex decision-making
Business Decision Process
- Users: Actual users of the product – Functional Units
- Influencers: Experts and opinion leaders - MIS
- Buyers: Negotiate with vendors, place the orders - Admin
- Deciders: Power to select vendors - Dept heads, Finance.
Reasons why role of marketer is complex
- Many ppl need to be managed
- Different roles
- Final selection isbased on prices
- There needs to be justification behind a purchase
How marketers could be more effective
How marketers could be more effective:
- Build strong relationships
- Manage all involved in decision-making
- Provide superior service: delivery, spares,
maintenance
- Make the decision easy: offer a strong brand
