Chapter 5 - Consumer Markets and Buyer Behavior PDF

Chapter 5 Consumer Markets and Consumer Buyer Behavior Copyright © 2009 Pearson Education, Inc. Chapter 16 - slide 1 Publishing as Prentice Hall  Outline 1. Describe the consumer market and the major factors...

Chapter 5 Consumer Markets and Consumer Buyer Behavior Copyright © 2009 Pearson Education, Inc. Chapter 16 - slide 1 Publishing as Prentice Hall  Outline 1. Describe the consumer market and the major factors that influence consumer buyer behavior. 2. Identify and discuss the stages in the buyer decision process.  Important terms “Consumer Markets and Consumer Buyer Behavior” Consumer buyer: end/final consumers individuals and households, who buy goods and services for personal consumption. These people/households make up the consumer market. Any other purposes? (business market in Chapter 6) Consumer buyer behavior: the buying behavior of these final consumers. The importance of understanding consumer buyer behavior Model of Consumer Behavior http://upload.wikimedia.org/wikipedia/commons/thumb/f/fa/Globe.svg/600px-Globe.svg.png  Characteristics Affecting Consumer Behavior Factors Influencing Consumer Behavior Are these factors under the control of companies?  BB discussion What factors influenced Ms. Peng's buying behavior when she prepared her first state trip with her husband in 2013? Please list ALL the factors you can think of plus a one-sentence explanation. For example: Age- because she was in her fifties at the time.  Characteristics Affecting Consumer Behavior – Culture Key Factors Forms a person’s wants and behavior – Subculture Cultural Groups with shared value Social systems/experience Personal – Social Class Psychological Society’s divisions who share values, interests and behaviors  Culture Culture is the most basic cause of a person's wants and behavior. – Culture reflects basic values, perceptions, wants, and behaviors. – Culture is learned from family, church, school, peers, colleagues, etc. “lucky numbers” in China? – Cultural shifts create opportunities for new products or may otherwise influence consumer behavior. “你结婚了吗？” from百合网 Anything you want to share about your culture?  Characteristics Affecting Consumer Behavior – Culture Key Factors Forms a person’s wants and behavior – Subculture Cultural Groups with shared value Social systems/experience Personal – Social Class Psychological Society’s divisions who share values, interests and behaviors  Subculture: – Is it wise to treat the Chinese consumers as “one group/market”? “南粥北面” – Groups of people (within a bigger group) with shared value systems based on common experiences. – Subcultures include: nationalities, religions, racial groups, and geographical regions. Marketing in Action “狗不理” in Hangzhou How successful can it be?  Social class Social class : Society’s relatively permanent and ordered divisions whose members share similar values, interests, and behaviors. – Measured by a combination of occupation, income, education, wealth, and other variables. – People within a given social class tend to exhibit similar buying behavior. Major American Social Classes  Characteristics Affecting Consumer Behavior – Groups Key Factors Membership groups Reference groups Cultural Opinion Leaders Social – Family Personal Many influencers Psychological – Roles and Status Social Factors Groups : membership groups – (direct influence, belonging ) reference groups serving as an indirect points of comparison or reference in forming attitudes and behavior, e.g., aspirational groups ⚫ a BFSU student interested in photography & BFSU photography CLUB & an online forum for photographers？  Importance of Groups exposure, influence, pressure to conform word of mouth (word-of-web) opinion leader: person within a reference group who, because of special skills, knowledge, personality… exert social influence on others. the elite group of those "in the know” KOL, influencer  Who is Austin Li? Taobao's King of Lipstick China’s top influencer The rise of E-Commerce live streaming…  Family: – Most important consumer buying organization. power of children / seniors, etc. (pester power & grey power) Roles and status: – position (in family, organization) defined by role & status – People choose products appropriate to their roles and status. dress code in the workplace buying a car in Beijing : a senior vice president vs. a sales manager vs. a new recruit (fresh out of college)  Characteristics Affecting Consumer Behavior – Age and life cycle Key Factors – Occupation – Economic situation Cultural – Lifestyle Social – Personality and self- Personal concept Psychological  Personal Factors Age and life-cycle stage: – age – life stage changes Occupation: – clothing Economic situation: – spendable income, savings and assets, debts – products/brands: price- sensitive & vulnerable to economic downturn  Personal Factors Self-concept: theory suggests that people’s possessions contribute to and reflect their identities. – “We are what we buy/have.” Lifestyle: People within the same subculture, social class, and occupation may have different lifestyles.  Marketing in Action Lifestyle Analysis Two examples: LOHAS BMW VALS analysis http://www.strategicbusi nessinsights.com/vals/pre survey.shtml  Personal Factors Personality: – refers to the unique psychological characteristics that lead to relatively consistent and lasting responses to one’s own environment. – generally defined in terms of traits. – linking to product/brand choice：brand personality  Brand Personality Dimensions Individual traits  Characteristics Affecting Consumer Behavior Key Factors – Motivation – Perception Cultural – Learning Social – Beliefs and attitudes Personal Psychological Characteristics Affecting Consumer Behavior Psychological Factors Motivation needs & wants Companies need to work hard to understand customer needs and wants. Smart companies can do more, because “needs cannot be created, but wants can be shaped by marketers.”  Characteristics Affecting Consumer Behavior Psychological Factors 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  Characteristics Affecting Consumer Behavior Psychological Factors 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 forget good points about competing brands.  Why discussing perception? Perception involves how people select and interpret information. Try to think and share your examples: Can ads today get your attention? Can ads reinforce or change your opinion about certain companies/bands?  The M example Selective attention： Selective distortion： Selective retention：  Beliefs and Attitudes Belief: – a descriptive thought that a person holds about something. Attitude: – A person’s enduring favorable or unfavorable evaluation, emotional feeling, and action tendency toward something. Putting people into a frame of mind of liking or disliking , leading people to behave in a consistent way towards something. e.g., Japanese products in China Difficult to change, but not impossible. – Example: “Got milk”  Marketing in Action Changing Attitudes ◆ Attitudes are difficult to change, but the National Fluid Milk Processor’s milk moustache campaign has succeeded in grand style. ◆ The long-running ad campaign has used a variety of celebrities appealing to many segments. Model of Consumer Behavior http://upload.wikimedia.org/wikipedia/commons/thumb/f/fa/Globe.svg/600px-Globe.svg.png The Buyer Decision Process Buyer Decision Making Process  The Buyer Decision Process Needs can be triggered by: Process Stages – Internal stimuli Normal needs become strong Need recognition enough to drive Information search behavior. Evaluation of alternatives – External stimuli Purchase decision WOM (friends) Postpurchase behavior Advertisements Discounts Please provide another example in class.  The Buyer Decision Process Sources of information: Process Stages – Personal: most effective information – Commercial: most information , informative Need recognition – Public Information search Evaluation of alternatives – Experiential Purchase decision word-of-mouth/web Postpurchase behavior opinion leaders/influencers many examples in “双十一”  The Buyer Decision Process Most buyers evaluate multiple Process Stages attributes, each of which is weighed differently. At the end of the evaluation Need recognition stage, purchase intentions are Information search formed. Evaluation of alternatives What attributes will you Purchase decision consider when buying a Postpurchase behavior smartphone/booking a hotel room? How can companies make such information more available to consumers?  The Buyer Decision Process Two factors intercede between purchase intentions and the actual Process Stages decision: – Attitudes of others consumer report, Need recognition customer reviews on Information search Evaluation of alternatives taobao.com Purchase decision – Unexpected situational Postpurchase behavior factors family crisis, unemployment, company crisis  Dr. Dao and United Airlines again Please find out more about the case, watch the “United Airlines clip” carefully and then comment on: Did United Airlines do a good job in terms of crisis management? Why?  The Buyer Decision Process Satisfaction is important: – Product performance vs. Process Stages customer expectation – P < E: Disappointment – P = E: Satisfaction Need recognition – P > E: Delight Information search What will happy and unhappy Evaluation of alternatives customers do? Purchase decision – To engage in positive Postpurchase behavior /negative word-of-mouth. – For marketers, knowing “what to promise” is important.  Summary 1. consumer market 2. the major factors that influence consumer buyer behavior.