Consumer Behaviour Module 2- Principles of Marketing, Trying to teach Consumer Behaviour

1. Consumer Behavior copyright©
DR. ANUPAMAA S. CHAVAN
S T U D E N T S A R E S T R I C T L Y W A R N E D N O T T O S H A R E / U P L O A D T H I S P P T O N A N Y W E B S I T E .

2. Learning Objectives:
What is Consumer Behavior
Factors influencing Buyer’s Behavior
Buying Habits/Shopping Behavior
Buying Process

3. Consumer Behavior
Consumer behavior is the study of how individual customers, groups or organizations select,
buy, use, and dispose ideas, goods, and services to satisfy their needs and wants.
It refers to the actions of the consumers in the marketplace and the underlying motives for
those actions.

4. Consumer Behaviour
Marketers need to know:
What one buys for cleaning teeth?.......... Toothpaste; brand is preferred:- Colgate/Dantkanti/Close-up/Dabur
Why he buy’s?.......for sparkling white teeth/strong teeth/ fresh breath
When he buy’s? ……Weekly/Monthly
Where he buys from/……..Supermarket/Retail store/Online
How much he buys?........200gm/400gm
https://www.youtube.com/watch?v=BXXdcgchAVw
Why
When
Where
How
What
Buy

5. Factors influencing Consumer Behavior
Cultural
• Culture
• Subculture
• Social class
Social
• Reference
groups
• Family
• Role & Status
Personal
• Age & Stages in Life
• Occupation & Eco.
Circumstances
• Personality & Self
Concept
• Life Style &Values
Psychological
• Motivation
• Perception
• Learning
• Emotions
• Memory
• Attitudes &
Beliefs
•Buyer

6. What Influences Consumer Behavior?
Cultural factors
◦ Culture
◦ Subcultures
◦ Social classes

7. Cultural factors
Cultural factors comprise of set of values, beliefs and ideologies of a particular community or group of
individuals.
It is the culture of an individual which decides the way he/she behaves. It is a learned behavior which is
acquired from the surroundings in which one lives.
Every individual has different sets of habits, beliefs and principles which he/she develops from his family
status and background. What they see from their childhood becomes their culture.

8. Cultural factors
Eg: Youth in US may value Freedom, Independence, Success, Achievement as against an Indian
youth who values Respect, Care, Honesty, Hardwork, Sacrifice
People living in northern hemisphere and those living in southern hemisphere have different
lifestyles, and may require/consume different products

9. Subcultures
Each culture further comprises of various subcultures such as nationalities, religion, racial groups,
geographical regions. Sub culture provides more detailed identification of their members.
Consumer preferences are influenced by their subculture
Eg: Gujarati can be a Vaishnav or a Jain believer
For some white colour is auspicious for some it is inauspicious.
For Hindus eating beef is considered to be a sin whereas Muslims and Christians absolutely relish the
same.

10. Social Classes
The division of members of a society into a hierarchy of distinct classes, so that members of each class share similar
values, interests, and behavior
Social class depend on variables such as Income, Wealth, Occupation and Education
The social class in US is classified in seven ascending levels:
1. Lower lowers
2. Upper lowers
3. Working class
4. Middle class
5. Upper middles
6. Lower uppers
7. Upper uppers

11. Social Factors
Social factors such as
1. Reference groups
2. Cliques
3. Family
4. Social roles and status
affect buying behavior……

12. What Influences Consumer Behavior?
Social factors
Reference groups
Cliques
Family
Roles and status

13. Reference Groups
Reference groups are all the groups which directly or indirectly influence the attitude and behavior.
Reference groups influence members in three ways:
1. Exposure to new behaviors and lifestyle
2. Attitudes and Self Concept
3. Creates pressure for conformity

14. Reference Groups
Reference groups having direct influence are membership groups such as:
◦ Primary groups – Family members, friends, peers, neighbours, and coworkers
◦ Secondary Groups – Religious/Professional/Trade-Union groups
People are also influenced by groups which they do not belong to:
◦ Aspirational Groups
◦ Dissociative Groups
◦ You also have Opinion Leaders who offers informal advice or information about a specific product or
product category.

15. Reference Groups
Reference Groups influence individuals in 2 ways:
1.Normative influence: when consumers perform their actions that confirm to the norms set by the
society. Products that are used in public have normative influence
2.Informational influence: when consumer is provided information from reliable source which helps
him to make a purchase decision.
Exercise: Enlist the goods/services you have purchased under the influence of various reference
groups
https://www.youtube.com/watch?v=_rgQMsvYyps&feature=youtu.be

16. Cliques
Cliques are small groups whose members interact frequently.

17. Family
Family of orientation vs. family of procreation

18. Family
Family is a group of individuals who are residing together and are related to each other by birth,
marriage or adoption
Family can be distinguished between two types
1. Family of Orientation: Parents and Siblings – influence a persons orientation towards religion,
politics, economics, ambition
2. Family of Procreation: Spouse and Children – direct influence on everyday buying behavior of
the consumers

19. Role and Status
Individual belong to many groups- family, clubs, organisation.
Role refers to activities individual is required to perform as a part of that group.
Each role has an impact of status which the individual has on the society.
CEO of an organisation has to play two roles:
-in organisation
-in his family

20. Buyer’s Roles
Initiator: A person who first suggests the idea of buying the particular product or service.
Influencer: A person whose view or advice influences the decision.
Decider: A person who decides on any component of a buying decision; whether to buy, what to
buy, how to buy, or where to buy .
Buyer: The person who makes the actual purchase.
User: A person who consumes or uses the product or service.
State the Buyer’s role for your admission in ASMSOC

21. Exercise:
1. Initiator- Influencer- Decider- Buyer- User-
2. Health Insurance – Unsought product; Selling Concept – Push strategy

22. Exercise:

23. Personal Factors
Age & Life Cycle stage
As an individual grows his taste and preferences change.
Occupation and Economic situations influences the consumption pattern- accordingly the
products are designed.
- e.g. Software Co. makes different software required for - Lawyers, Engineers,
Physicians, Managers etc.

24. Personal factors
Personality and Self Concepts
◦ Personality signifies the inner psychological characteristics that reflect how a person reacts to his
environment.
◦ Personality is often described in terms of traits such as self confidence, dominance, autonomy,
deference, sociability, defensiveness, and adaptability.
◦ Brands also have personality and consumers are likely to choose brands whose personalities match their
own.

25. Brand Personality
Stanford’s Jennifer Aakar researched and identified following traits in a Brand Personality :
DR. ANUPAMAA CHAVAN 25

26. Brand Personality
Sincerity: Family oriented, down to earth, cheerful, honest
Excitement: Spirited, up-to-date, imaginative
Competence: Successful, influential, competent, reliable
Sophistication: Pretentious, wealthy, upper-class, charming
Ruggedness: Athletic and outdoorsy, tough
DR. ANUPAMAA CHAVAN 26

27. Brand Personality
Give five examples of goods/services belonging to each trait of brand personality.
DR. ANUPAMAA CHAVAN 27

28. Brand Personality
Volvo
Disney world
Armani
Ford
Tata
Levi’s
Land rover
Volkswagen
Godrej
Rolex
Cartier
Sophistication/Competence
Excitement
Sophistication
Excitement
Sincerity
Excitement
Ruggedness
Competence
Sincerity
Sophistication
Sophistication
DR. ANUPAMAA CHAVAN 28

29. Personal Factors
Lifestyle & Values : It is a way how person lives. It is individual’s pattern of living in the world as expressed in
activities, interests, and opinions. People from same subculture, social status and occupation may adopt quite
different lifestyles
Lifestyles are shaped partly by whether consumers are money constrained or time constrained
Eg:-
Walmart (Retail)- largest company in the world follows ‘ everyday day low prices’ – for price minded
consumers
Food processor for time constrained consumers.
Individuals having healthy lifestyles consume healthy products.

30. Psychological Factors………
The Psychological factors are the factors that talk about the psychology of an individual that
drive his actions to seek satisfaction. It includes:
◦ Motivation
◦ Perception
◦ Learning
◦ Emotions
◦ Memory

31. Motivation
A motive is a need that is sufficiently pressing to direct the person to seek
satisfaction.
Needs can be classified as : biogenic and psychogenic
Biogenic needs - physiological
Psychogenic needs - psychological

32. Motivation
Buying Motives are the inner urges, impulses, desires, which makes an individual buy.
Buying motives can be further classified as:
◦ Primary Buying Motives
◦ Secondary Buying Motives:
◦ Rational Buying Motives
◦ Emotional Buying Motives
◦ Patronage Buying Motives

33. Buying Motives
Primary Buying Motives Secondary Buying Motives
Basic Needs:
Food
Clothing
Shelter
Rational/Financial Buying
Motives
Emotional/Non Financial
Buying Motives
Patronage Buying Motives
Economy/Gain
Profit/Income
Property
Investments
Utility
Financial instruments
Love & Affection
Pride & Possession
Fashion
Gifts
Hobbies
Recreation
Education
Suitable Location
Prompt Service
Quality Product
Value Preposition
Personnel ability

34. Maslow’s Theory of Motivation

35. Herzberg’s Theory
Frederick Herzberg developed a two factor theory that distinguishes:
◦ Dissatisfiers – (factors that cause dissatisfaction) from
◦ Satisfiers – ( factors that cause satisfaction)
◦ The absence of dissatisfiers is not enough to motivate a purchase; satisfiers must be present.
◦ For e.g. No Warranty is a dissatisfier but it may not be the satisfier either, Ease of use is a satisfier.

36.  This theory talks about the Unconscious, Subconscious and
the Conscious mind:
 ID (Instinctive Drives)
 Ego
 Super Ego

37. Perception
Perception is the process by which people select, organize, and interpret information to form a
meaningful picture of the world from three perceptual processes:
◦ Selective attention
◦ Selective distortion
◦ Selective retention

38. Perception
Selective attention is the tendency for people to screen out most of the information to which
they are exposed.
Selective distortion is the tendency for people to interpret information in a way that will
support what they already believe.
Selective retention is the tendency to remember good points made about a brand they favor
and to forget good points about competing brands.

39. The Power of Sensory Marketing
Sensory Marketing has been defined as ‘marketing that engages the consumer’s senses and
affects their perception, judgement and behavior.’
All five senses are engaged in sensory marketing:
◦ Touch (Haptic)
◦ Smell
◦ Sound(audition)
◦ Taste
◦ Vision

40. Learning
Learning is the changes in an individual’s behavior arising from experience and occurs through
interplay of:
◦ Drives
◦ Stimuli
◦ Cues
◦ Responses
◦ Reinforcement

41. Learning
Learning theory teaches marketers that they can build demand for a product by associating it
with strong drives, using motivating cues, and providing positives reinforcement.
Marketers to also note about Hedonic Bias
Hedonic bias occurs when people have a general tendency to attribute success to themselves
and failure to external causes.

42. Learning
In classical conditioning, the advertiser attempts to get consumers to associate their product
with a particular feeling or response, in the hope that the consumer will then buy the product. ...
Consumers may then associate good feelings and having fun with the product and may be more
likely to buy the product.
In classical conditioning, the goal is to get consumers to associate brands with a particular
feeling or response. ... Coca-Cola, for example, has successfully associated their brand with
happiness and satisfaction

43. Learning
Instrumental or Operant conditioning views consumers as an active participant for learning.
It is referred to as instrumental conditioning because the individual's response is instrumental in
getting a positive reinforcement (reward) or avoiding negative reinforcement (punishment).
Instrumental/Operant conditioning might be something like an offer or a reward, such as “buy one, get
one”.

44. Emotions
Emotions are changes in the body state that impact psychological processes thereby resulting in
expression of feelings and observable behavioral reactions.
Brands like Hallmark, McDonald’s, Coca-Cola have made an emotional connection with loyal
customers for years

45. Memory
Memory is total accumulation of prior learning experiences
Memory ranges in duration on a continuum from extremely short to very long term
Memory encoding
Memory retrieval

46. Beliefs & Attitude
Belief is a descriptive thought that a person holds about something.
Attitude is a person’s enduring favorable (positive) or unfavorable (negative) evaluations,
emotional feeling, and action tendencies towards some object or idea.
https://www.youtube.com/watch?v=9HNl_Eas4R8

47. Case Study – Domino’s Pizza
American restaurant chain
◦ Founded in 1960
◦ Opened first international pizza store in Canada
◦ 12,500 stores in more than 86 countries
◦ Delivers more than 1 million pizzas per day worldwide
Domino’s Pizza faced criticism from its consumers in 2009.
Lets see how this was tackled by Domino’s……

48. Case Study: Award-Winning Marketing Campaign
Marketers need to understand how consumers think, feel and act and accordingly offer clear value to each and every target customer.
Domino’s Pizza faced criticism from its consumers in 2009.
This is how Domino’s decided to deal with negative consumer attitudes about its pizza.
https://www.youtube.com/watch?v=AH5R56jILag
https://www.youtube.com/watch?v=czyu-EUwQsQ
https://www.youtube.com/watch?v=A-lphVQkM1s
From the end of 2009, when Domino’s announced its plans, until the end of 2011, the stock
gained 233%, compared with 37% for its key rival, Papa John’s.
The sales have been further spurred by marketing innovations such as mobile-optimised website
for online ordering, new audible formats for the chain’s popular Pizza tracker, smart-phone and
table apps for ordering, and the Pizza Hero game for the iPad.

49. Case Study - Joie de Vivre Hotels
Joie de Vivre is a French phrase often used in English to express a cheerful enjoyment of life
Joie de Vivre Hospitality is a hotel and restaurant company based in San Francisco, California as
well as Arizona, Illinios, and Hawaii, and the second-largest operator of boutique hotels in the
United States.
https://www.youtube.com/watch?v=fSK6tlZ4_LI

50. Buying/Shopping Habits

51. Buying Process

52. Need /Problem Recognition
Internal stimuli
External stimuli

53. Information Gathering/Search
Information sources:
◦ Personal: Family, Friends, Neighbors, Acquaintances
◦ Commercials: Advertising, Websites, E-mails, Sales Person, Dealers, Packaging, Displays
 Public: Mass Media, Social Media, Consumer-rating organisations
 Experiential: Handling, Examining, Using the Product

54. Search Dynamics
Total Set
Apple, Dell, Lenovo, HP, Acer, Toshiba, Sony, Samsung, Asus, Huawei, Microsoft, Hewlett Packard
Awareness Set
Apple, Dell, Lenovo, HP, Acer, Hewlett Packard
Consideration Set
Apple, Dell, Lenovo
Choice Set
Apple ,Dell
Decision
?

55. Evaluation of Alternatives
The attributes of interest to buyers may vary by products:
◦ Hotels: Location, Cleanliness, Atmosphere, Price
◦ Mouthwash: Color, Effectiveness, Germ Killing capacity, Taste/flavor, Price
◦ Tires: Safety, Tread life, Ride, Quality, Price
◦ Beliefs and Attitude:
Belief is a descriptive thought that a person holds about something.
Attitude is a person’s enduring favorable (positive) or unfavorable (negative) evaluations, emotional feeling,
and action tendencies towards some object or idea.

56. Dr. Anupamaa Chavan 56
All Brands
Known
Brands
Unknown
Brands
Evoked Set
(Acceptable
Brands)
Inept Set
(Unacceptable
brands)
Inert Set
(Indifferent
Brands)
Purchased
Brands
Not
purchased
Brands

57. Evaluation of Alternatives
Expectancy Value Model/Multi Attribute Attitude Model
◦ Expectancy Value model is the consumer attitude theory which proposes that customers rank products
based on product characteristics.
◦ Exercise on Purchase decision to buy mobile and consumer durable product according to Expectancy
Value model/ Multi Attribute Attitude Theory
◦ Marketers to apply following strategies to stimulate greater interest:
◦ Redesign the mobile (Real Repositioning)
◦ Alter beliefs about the brand (Psychological Repositioning)
◦ Alter beliefs about competitors brand (Competitive Depositioning)
◦ Alter the importance to weights
◦ Call attention to neglected attributes
◦ Shift the buyers ideals

58. Multi Attribute Attitude Model:
Particulars/ Weights Samsung Apple One Plus Oppo
Price
Camera
Battery
RAM
Storage
Processor
Screen
Total
DR. ANUPAMAA CHAVAN 58

59. Multi Attribute Attitude Model:
DR. ANUPAMAA CHAVAN 59
Particulars&Weights Samsung Apple One Plus Readmi
Price
-
Camera
Battery
RAM
Storage
Processor
Screen
Total
6
9
8
8
9
7
10
5
9
7
8
8
10
10
8
7
8
8
9
9
8
9
4
9
4
9
6
6
9
10
5
6
8
7
4
X 9 = 54

60. Multi Attribute Attitude Model:
6 x 9=54 5x9=45 8x9-72 9x9=81
9 x10=90 9x10=90 7x10=70 4x10=40
8x5=40 7x5=35 8x5=40 9x5=45
8x6=48 8x6=48 8x6=48 4x6=24
9x8=72 8x8=64 9x8=72 9x8=72
7x49=49 10x7=70 9x7=63 6x7=42
10x4=40 10x4=40 8x4=32 6x4=24
390 392 397 328
DR. ANUPAMAA CHAVAN 60
Particulars&Weights Samsung Apple One Plus Readmi
Price - 9
Camera - 10
Battery - 5
RAM - 6
Storage- 8
Processor - 7
Screen - 4
Total
Highest Score = 397 One Plus

61. Purchase Decision
After evaluation the customer may make as many as 5 sub decisions :
◦ Brand
◦ Dealer
◦ Quantity/Size
◦ Timing
◦ Payment Method

62. Compensatory Processes
Multi Attribute Attitude Model:

63. Non-Compensatory Processes
1. Conjunctive heuristics:
2. Disjunctive heuristics:
3. Lexicographic heuristics:
4. Elimination-by-aspects heuristics
https://www.youtube.com/watch?v=IdNy2qWzcjA&t=62s

64. Non-Compensatory Processes
But consumers often take mental shortcuts called ‘heuristics’ or thumb rule in decision process.
Choice heuristics : (Non-Compensatory Processes)
◦ Conjunctive heuristics: minimum acceptable cut off level for each attribute
◦ Disjunctive heuristics: must meet minimum score on any Key attribute
◦ Lexicographic heuristics: to select a brand on the basis of important attribute
◦ Elimination-by-aspects heuristics: to compare brands on an attributes selected probabilistically
◦ https://www.youtube.com/watch?v=IdNy2qWzcjA&t=62s
◦ Marketers to apply following strategies to stimulate greater interest:
◦ Redesign the mobile (Real Repositioning)
◦ Alter beliefs about the brand (Psychological Repositioning)
◦ Alter beliefs about competitors brand (Competitive Depositioning)
◦ Alter the importance to weights
◦ Call attention to neglected attributes
◦ Shift the buyers ideals
DR. ANUPAMAA CHAVAN 64

65. Purchase Decision
After evaluation the customer may make as many as 5 sub decisions :
◦ Brand
◦ Dealer
◦ Quantity/Size
◦ Timing
◦ Payment Method

66. Purchase Decision
The Purchase takes place, but….
The final purchase decision can be disrupted by two factors:
◦ Negative feedback from other customers and the level of motivation to comply or accept the feedback.
◦ The decision may be disrupted due to one or more types of perceived risks:
◦ Functional Risk: does not perform to expectation
◦ Physical Risk: threat to physical well being
◦ Financial risk: not worth the price
◦ Social Risk: Embarrassment in front of others
◦ Psychological risk: affects the mental health
◦ Time Risk: failure of product results in an opportunity cost of finding out other product

67. Post Purchase Behavior
Marketers must monitor :
◦ Post purchase Satisfaction
◦ Post purchase Actions
◦ Post purchase Uses and Disposal

68. Post Purchase Behavior: How consumer
uses or disposes off the product

69. Model Of Consumer Behavior
(stimulus response model)

70. Value creation….
EXERCISE:
Describe the buying process in case of any five products bought by you or your family which
has gone through all the steps in buying. Mention the names of individuals playing various
buying roles. Also enumerate if you have encountered dissonance if any, how was it tackled?

71. THANK YOU….