Week 4 - Consumer Behavior Flashcards
Why does consumption occur?
Real or perceived
Need, want, or desire
What should marketers identify about the consumer problem solving cycle?
How and why consumers chose a product
What is the difference:
Consumer behavior?
Buyer behavior?
Consumer = purchases for personal use Buyer = purchases for organisational use
Both are humans
What are the unique conditions of buyer behavior (eg, organisational use)
Multiple decision makers Derived demand (reliant on consumer demand) Inelastic demand (low price sensitivity in short term) Reciprocity (equivalence of advantages - arrange to buy from each other)
Are consumer buyers completely different from organisational buyers?
No - think parents buying for kids = multiple decision makers
what are the types of business buys?
straight rebuy
modified rebuy
new task buying
what’s a straight rebuy?
identical refill for organisational purchase
low time investment
what’s a modified rebuy?
refill with slight changes for organizational purchase
medium time investment
what’s a new task buy?
new organisational purchase for a new need
high time investment
what are the three models of buying - John O’Shaughnessy
want without buying
buy without deciding
deciding before buying
what does it mean to want without buying?
latent want - we don’t a product is available to fulfill our need
passive want - we procrastinate for avoidance or exclusionary factors
what are avoidance factors for passive wants (want without buying)?
perceived costs outweight benefits
what are exclusionary factors for passive wants (want without buying)?
external factors - like a promise to someone else or law prohibiting
what does it mean to buy without deciding
habit - previous choice or learned behavior
picking - random or convenience choice
intrinsic preference - gut choice, say on packaging in store
laundry detergent for instance is often a HABIT
what does it mean to decide before buying?
really = buy after deciding
choice criteria: technical - performance/attributes legalistic - externally imposed limits integrative - reinforce image or role adaptive - proxies to inform choice economic - cost/benefit perception
in consumer buying, what are levels of involvement and emotion?
involvement
- levels of intensity
- importance to the individual
emotion
- rational
- emotional
what types of products have high involvement buying processes?
highly visible, expensive, long lifespan
not dichotomous: high for one person might be low for someone else
what types of products have high emotion buying processes?
direct personal impact, high degree of variation, credence qualities, perceived risks
again, not dichotomous
what is the challenge of managing expectations?
high expectations =
higher purchase likelihood
higher chance of failing to meet expectations
when is it important to manage expectations
pre-purchase
purchase
post-purchase
what are consumer expectations?
beliefs about product/service
based on standards/prior experience/reference points
what are the levels of consumer expectation?
ideal normative experiences-based acceptable minimum tolerable
what are ideal expectations?
top quality possible
often based on external standards: celebs, social media
often apply to fields like cosmetics
what are normative expectations?
what we perceive as what the outcome “should be”
often based on observable criteria (decor, price)
what are experiences-based expectations?
based on what we’ve experienced
or what someone else has described to us
reasonably established over multiple data points
might not be accurate recall
what are acceptable expectations?
based on previous general experience in product category
industry standard for safety, wait time, etc
what are minimum tolerable expectations?
lowest bar before unacceptable
external factors might set this bar very low
eg, hurricane evacuation shelter
what is the consumer gap?
difference between expected service and perceived service
wider gap = dissatisfied customers
marketers must set reasonable expectations to close the gap
what are the three internal drivers of behavior?
group
culture - subconscious, influences values
individual
values - what a person believes, informs attitude
attitude - approach to life, informs purchase behavior
why does is it important to understand culture, value, and attitudes?
critical to research
greatly informs the how and esp the why of consumer purchase
what two decision models will we focus on?
consumer buying decision process
consumer adoption model
what are the 5 steps in the consumer buying decision process
problem recognition information search alternative evaluation purchase decision postpurchase evaluation
what is problem recognition in CBD?
aka, need recognition
person realises they have a need, want, or desire internal trigger (hunger) external trigger (ad)
sometimes this step is subconscious
what is information search in CBD?
looking for potential solutions to need
- internal info (i remember doing x)
- external info (google search)
active (google search)
passive (glancing at street signs)
generates limited set due to elimination or failure to notice alternatives
what is evaluation of alternatives in CBD?
information search generated “choice set”
“consideration set” based on available info
first pick might not be decided
what is purchase decision in CBD?
try to act on first choice
might not be possible (out of stock)
eventually purchase based on internal/external factors
what is postpurchase evaluation in CBD?
evaluation to see how it meets expectations
sometimes formal, sometimes informal
cognitive dissonance = not sure I made the right decision
what is the Consumer Adoption Process model?
how consumers decide to become habitual product user
Awareness Interest Evaluation Trial Adoption
what is awareness in CAP model?
become aware that a product or product category exists and can address our needs
often done through advertising
what is interest in CAP model?
researching to learn more
comparing to current solution
what is evaluation in CAP model?
after interest, might choose to evaluate product
availability impacts evaluation
complexity and compatibility matter
what is trial in CAP model?
if evaluation = favorable, might try the product
trialability = degree to which can be test run at low/no risk divisibility = can it be broken into small portions for trial
in many cases trial must be skipped if not possible
what is trialability in Consumer Adoption Model
trialability = degree to which can be test run at low/no risk
what is divisibility in Consumer Adoption Model
divisibility = can it be broken into small portions for trial
what is adoption in CAP model?
if trial is favorable, make a new habit
perceived risk, value, reward
what is the STP process?
Segmenting
Targeting
Positioning
why do the STP process?
most orgs can’t appeal to everyone equally
selecting one or more subgroups can be effective
what is segmenting in STP?
subdividing the population into meaningful groups
not just groups
targeted clusters that are willing, able, and empowered with authority to buy
what is positioning in STP?
developing product/marketing strategies that make the target market feel heard and helped
what is targeting in STP?
process of evaluating segments and selecting one or more to focus on serving
what are effective segments?
differentiatable - meaningful differences from other segments
measurable - estimate size and growth rate
accessabile - we can reach them with marcoms
substantial - warrant potential servicing
what are the segmentation stages?
survey stage - collect data
analysis stage - form clusters
profiling stage - write profiles for each segment
what types of patterns will we see in market characteristics?
homogeneous - all customers have similar needs/wants/desires
heterogeneous - very diverse wants/desires
clustered - groups with similar needs/wants/desires
what are the four bases of segmentation?
geographic
demographic (age, gender, edu, income, religion)
psychographic (personality, attitude, beliefs)
behavioral (purchasing behavior: usage, benefit sought)
typically multiple bases = stronger segmentation
what are the targeting stages in STP?
evaluate segments (market potential, competitive analysis) select segments (which one or more are optimal) develop targeting strategy (depends on the segment)
what are the four targeting strategies?
undifferentiated - treat everyone as one market (homogeneous)
concentrated - focus on one segment only (clustered)
differentiated - focus on a few different segments (clustered)
individual - treat everyone differently (heterogeneous)
what is the purpose of positioning in STP?
Philip Kotler: winning/keeping customers means (1) understanding needs and (2) serving better than competition
positioning = effort to meet needs of target customers better than competition
what is the positioning process in STP?
identify where our customers are
perceptual mapping of competition on segments
figure out how to communicate effectively to the customers
will be covered in module 5 in more detail
