Consumer Markets and Buying Behavior

• HTM110 Tourism and Hospitality Marketing aims to teach you how to distinguish the characteristics that affect the marketing of a hospitality or travel product.
• Module 5 explores Consumer Markets and Consumer Buying Behavior
• By the end of this module, you should be able to:
• Classify the model of buyer’s behavior
• Analyze major characteristics affecting consumer behavior
• List cultural, social, personal, and psychological factors influencing consumers
• Recognize the buyer decision process
• Discuss need recognition, information search, evaluation of alternatives, purchase decision, and post-purchase behavior

Module Topics

• The module will cover the following topics
• Model of a buyer’s behavior
• Major characteristics affecting consumer behavior
• Buyer decision process (need recognition, information search, evaluation of alternatives, purchase decision, and post-purchase)

Consumer Behavior Model

• The marketplace is highly competitive, especially in hospitality due to globalization
• Hotel companies from various countries vigorously compete in many markets.
• Companies invest in research to understand consumer preferences regarding what, where, how, and why they buy
• A successful company understands how consumers respond to product features, prices, and advertising.
• Researchers study the relationship between marketing stimuli and consumer response.
• Marketing stimuli include the four P's: product, price, place, and promotion.
• Other stimuli encompass economic, technological, political, and cultural forces.
• All stimuli enter the buyer's black box and transform into observable buyer responses like product choice, brand choice, purchase timing and amount
• Marketers need to understand the consumer’s black box
• Buyer characteristics influence perception and reaction to stimuli
• A buyer's decision process also affects outcomes
• Chapters will cover buyer characteristics and the buyer decision process

Personal Factors

• Cultural, social, personal, and psychological characteristics significantly influence consumer purchases.
• These factors are mostly uncontrollable by marketers but must be considered.

Cultural Factors

• Cultural factors have the broadest and deepest impact on consumer behavior.
• Culture is the primary determinant of a person's wants and behavior, including values, perceptions, and behaviors learned in society.
• Subcultures are smaller groups within a culture that share value systems based on common experiences and situations.
• Social class structures exist in most societies as relatively permanent divisions where members share values, interests, and behaviors.

Social Factors

• Groups, family, social roles, and status influence consumer behavior.
• Membership groups have a direct influence and to which a person belongs
• Reference groups are direct or indirect points of comparison or reference in forming attitudes and behavior.
• Word-of-mouth influence and buzz marketing is more credible than commercial sources like ads, leveraging recommendations from trusted sources.
• Online social networks are online communities for socializing and information exchange

Family, Roles and Status

• Family members strongly influence buyer behavior, they remain the most important consumer buying organization.
• Husband-wife involvement varies across product categories and buying process stages
• Roles and Status: A person belongs to multiple groups (family, clubs, organizations), with their position defined by role and status.

Personal Factors

• Personal characteristics like age, life-cycle stage, occupation, economic situation, lifestyle, personality, and self-concept influence buying decisions.
• Age and Life-Cycle Stage: Goods and services purchased evolve over a lifetime, affecting preferences of leisure activities ans travel
• Occupation: Affects what goods/services are bought and from where (Ex: construction worker lunch vs business executives)
• Economic Situation: Significantly affects product choices (Consumers cut back on restaurant meals, entertainment, and vacations during recessions.)
• Lifestyle: Reflects a person’s pattern of living regarding activities, interests, and opinions (portrays the “whole person” interacting with their environment)
• Personality and Self-Concept: Personality influences buying behavior (useful in analyzing consumer behavior)

Psychological Factors

• Motivation, perception, learning, beliefs, and attitudes influence a person’s buying choices.
• Motivation: A need becomes a motive when aroused enough. Ex: biological and psychological requirements
• Maslow’s Hierarchy of Needs arranges human needs from most to least pressing: physiological, safety, social, esteem, and self-actualization.
• Perception: A motivated person is ready to act, perception shapes how they act based on their situation
• Learning: Describes change in behavior from experience via interplay of drives, stimuli, cues, responses, and reinforcement and shapes buying decisions
• Beliefs and attitudes come from acting/learning; they influence buying behavior and belief describes thoughts somebody holds

The Buyer Decision Process

• The buying process extends both before and after the purchase, encouraging marketers to consider the entire process
• Need Recognition: Triggered when a buyer identifies a problem or need, sensing a difference between their current and desired state
• Information Search: Aroused consumers may search for more information if the drive is strong and the product isn't readily available, store need in memory
• consumers can obtain information from personal, commercial, and public sources
• Evaluation of Alternatives: Consumers assess products as bundles of attributes, varying in relevance based on food quality, menu, service, atmosphere and price
• Purchase Intention can be swayed by unexpected circumstances
• A customer forms their intention based on expected income, price, and benefits
• Post-Purchase - Dissatisfaction stems from the gap between expectations and actual performance

What determines satisfaction?

• Satisfaction depends on the relationship between consumer expectations and perceived product performance.
• If the product aligns with expectations, the consumer is satisfied, but dissatisfaction arises otherwise.