Kotler 2020, Chapter 6 - Consumer Buyer Behaviour PDF
Document Details
Uploaded by SupportiveHyena
Stockholm University
Tags
Summary
This document introduces Chapter 6 of Kotler 2020, focusing on consumer markets and consumer buyer behavior. The chapter preview highlights the importance of understanding consumer behavior for effective marketing strategies. The learning objectives outlined cover key aspects of buyer behavior, including definitions and models.
Full Transcript
CHAPTER 6 – Consumer markets and consumer buyer behaviour Mini contents Company case - Buyer involvement explains how we buy Models of consumer behaviour Characteristics affecting consumer behaviour Real Marketing -Tapping social media moms as brand ambassadors Types of buying de...
CHAPTER 6 – Consumer markets and consumer buyer behaviour Mini contents Company case - Buyer involvement explains how we buy Models of consumer behaviour Characteristics affecting consumer behaviour Real Marketing -Tapping social media moms as brand ambassadors Types of buying decision behaviour The buyer decision process The buyer decision process for new products Company case - The Internet of Things: slow adoption Chapter preview In the previous chapter you studied how marketers obtain, analyse and use information to understand the marketplace and to assess marketing programmes, and how sustainability concerns influence society, companies and consumers. In this chapter, we'll continue with a closer look at the most important element of the marketplace - consumers. The aim of marketing is to affect how consumers think and act. To affect the whats, whens and hows of buying behaviour, marketers must first understand the whys. In this chapter, we look at final consumer buying influences and processes. In the next chapter, we`ll study the buying behaviour of business customers. Understanding buyer behaviour is an essential but very difficult task. We first look at how buyer involvement influences the way marketers deal with markets and consumers. As you'll see, it provides one - but far from the only - key explanation as to how consumers behave. Learning objectives After reading this chapter, you should be able to: 1. Define the consumer market and construct a simple model of consumer buyer behaviour, 2. Name the four major factors that influence consumer buyer behaviour. 3. Understand and give examples of the four types of buying decision behaviour and explain the role of buyer involvement 4. Account for and give examples of the buyer decision process ___________________________________________________________________________ Buying behaviour is never simple, yet understanding it is the essential task of marketing management. Consumer buyer behaviour refers to the buying behaviour of final consumers individuals and households that buy goods and services for personal consumption. All of these final consumers combine to make up the consumer market, which consists of around seven billion people. Consumer buyer behaviour – The buying behaviour of final consumers individuals and households that buy goods and services for personal consumption. Consumers around the world vary tremendously in age, income, education level and pref- erences. They also buy an incredible variety of goods and services. How these diverse consumers relate to each other, and to other elements of the world around them, impacts their choices among various products, services and companies. In this chapter, we'll examine the fascinating array of factors that affect consumer behaviour. Consumer market – All the individuals and households that buy or acquire goods and services for personal consumption. Models of consumer behaviour Consumers make many buying decisions every week, and the buying decision is the focal point of the marketer's effort. In the best case, the customer's purchases become routinized and a relationship starts to develop between the consumer and companies. A consumer may also be loyal and choose new products from the company they are loyal to - Zara, Nordic Choice Hotels, or TV4. Most large companies research consumer buying decisions in great detail in order to answer questions about what consumers buy, where they buy, how and how much they buy, when I they buy, and why they buy. Marketers can study actual consumer purchases to find out what they buy, where and how much. But learning about the whys of consumer buying behaviour is not SO easy -1 the answers are often locked deep within the consumer's mind. And consumers themselves may not be aware of the true answers to the whys of buying - important insights that give rise to many questions, e.g. about consumer-generated data. 'The human mind doesn't work in a linear way, says one marketing expert. The idea that the mind is a computer with storage compartments where brands or logos or recognizable packages are stored in clearly marked folders that can be accessed by cleverly written ads or commercials simply doesn't exist. Instead, the mind is whirling, swirling, jumbled mass of neurons bouncing around, colliding and continuously creating new concepts and and thoughts and relationships inside every single person's brain all over the world.'1 Consumers themselves don't know exactly what influences their purchases, and even if they know, they research or filling in surveys. This insight is key to understanding the importance of may avoid the facts in dealing with selling companies, answering questions in marketing consumer behaviour. The central question for marketers is: how do consumers respond to various marketing efforts the company might use? The starting point is the stimulus-response model of buyer behaviour shown in Figure 6.1. This figure shows that marketing and other stimuli enter the consumer's 'black box' and produce certain responses Marketers must figure out what is in the buyer's black box. Marketing stimuli may consist of the four Ps - product price, place and promotion or major forces and events in the buyer's environment: economic, technological, political, ecological and cultural. All these inputs enter the buyer's black box, where they are turned into a set of observable buyer responses: the buyer's brand and company relationshíp behaviour and what they buy, when, where and how often. The marketer wants to understand how the stimuli are changed into responses inside the consumer's black box, which has two parts. First, the buyer's characteristics influence how they perceive and react to the stimuli. Second, the buyer's decision process itself affects the buyer's behaviour. We look first at buyer characteristics as they affect buyer behaviour and then discuss the buyer decision process. Characteristics affecting consumer behaviour Consumer purchases are influenced strongly by cultural, social, personal and psychological characteristics, shown in Figure 6.2. For the most part, marketers cannot control such factors, but they must take them into account. Many levels of factors affect our buying behaviour from broad cultural and social influences to motivations, beliefs and attitudes lying deep within us. The multitude of explanations to a particular purchase decision makes it difficult to fig ure out what are the key characteristics. For example, why did you buy that specific piece of clothing, vacation trip, car, mobile phone or apartment? Cultural factors Cultural factors exert a broad and deep influence on consumer behaviour. The marketer needs to understand the role played by the buyer's culture, subculture and social grade. Culture Culture is the most basic determinant of a person's wants and behaviour, Human behaviour is largely learned. Growing up in a society, a child learns basic values, perceptions, wants and behaviours from the family, other social arenas, popular culture and societal institu- tions. A child normally learns or is exposed to values such as achievement and success in different dimensions; material comfort or prioritizing living standards through other means than consumption and material comfort; individualism Vs. collectivism; freedom; humanitarianism; youthfulness; conservatism; enjoying life, and fitness and health. Every group or society has a culture, and cultural influences on buying behaviour can vary greatly, not only from country to country but also within countries.? Failure to adjust to these differences can result in ineffective marketing or embarrassing mistakes. Marketers are always trying to spot cultural shifts in order to discover what new products might be wanted. For example, the cultural shift towards greater concern about health and fitness has created a huge industry for health-and-fitness services, exercise equipment and clothing, organic foods and a variety of diets. The shift towards environmental and social responsibility has resulted in a greater demand for sustainable products, from ecological clothing to cars run on non-fossil fuels to train travel. Subculture Each culture contains smaller subcultures, or groups of people with shared value systems based on common life experiences and situations. Subcultures include nationalities, reli- gions and geographic regions, but a creative marketer will find many more subcultures that provide marketing opportunities. The differences between subcultures and cultures are not always clear - something that is an opportunity to marketers -and some groups might feel embarrassed by being seen as a subculture. AS a consequence, a marketer should conduct the subculture analysis with prudence. Subculture – A group of people with shared value systems based on common life experiences and situations. Mature consumers - the baby boomer generation Mature consumers are becoming a very attractive market around the world, and in developed countries in particular. This segment is, contrary to popular belief, not necessarily stuck in their ways'. On the contrary, one study showed that for products such as computers and mobile phones, older consumers are more willing to shop around and switch brands than their younger counterparts. As most baby boomers are now retired, they have more time and more money than the generation succeeding them, and SO the best strategy is to appeal to their active, multidimen- sional lives. However, purchase criteria and the purchase process must be understood. That's always key to understanding how a group of consumers – a potential segment – will think and act. Social grade Almost every society has some form of social grade structure. Social grades are society's relatively permanent and ordered divisions whose members share similar values, interests and behaviours. There is a slight difference between social grade and social class; the latter is more common concept i in the US, while grade is more widely used in Europe. From a marketing perspective, social grade is more interesting as it focuses on purchasing power rather than professional status and qualifications. Social grade normally only provides a classification for the working population. Studies from the UK indicate that social grade iS a strong predictor of certain phenomena relating to consumption, e.g readership of a quality newspaper, where the index is ten times higher in group AB than in group D, Substantial differences were also found in Internet usage and holidaying abroad. Social grade – Relatively permanent and ordered divisions in a society whose members share similar values, interests and behaviours. Marketers are interested in social grade because people within a given social grade tend to exhibit similar buying behaviour. Social grades show distinct product and brand preferences in areas such as clothing. home furnishings. leisure activity and car purchase and use. Social grade is not determined by a single factor, such as income, but is measured as 2 combina- tion of occupation, income, education, wealth and other variables. In some social systems, members of different classes are reared for certain roles and find it very difficult to change their social positions. In other countries, e.g. Scandinavia and the US, the lines between social grades are not rigid; people can move to a higher social grade or drop into a lower one. One of the early works (198o) on social grade by Alisa Higgins suggests that Sweden doesn't really have a grades system.s At the time, Sweden stood out as a country with limited use of social grades. In the real world, however, Sweden has social grades just like any other country, although differences among grades may not be as great as in, for example, the us, China or Russia. In the US, class and grade can be very explicit, while in Sweden it is hardly ever discussed, although it is discussed more now than back in the 198os. But while Ameri- cans may be more 'showy about their status, in Europe social grade is often obvious to those who are sensitive to and observant of it. Social factors A consumer's behaviour is also influenced by social factors, such as the consumer's small groups, family, and social roles and status. Groups and social networks Many small groups influence a person's behaviour. Groups that have a direct influence and to which a person belongs are called membership groups, In contrast, reference groups serve attitudes or behaviour. People often are infuenced by reference groups to which they do not as direct (face-to-face) or indirect points of comparison or reference in forming a person's belong. For example, an aspirational group is one to which the individual wishes to belong, as when young business students hope someday to reach the level of success of entrepreneurs such as Steve Jobs or Jeff Bezos (founder and CEO of Amazon). Similar examples may be found in any field -a politician may aspire to become prime minister, a football player to become David Beckham and a musician to become the new Ariana Grande, Ed Sheeran, ABBA or Beatles. These groups can be very powerful in influencing behaviour. The individual will often adopt the behaviour of the aspirational group in the hope of either being accepted as a member or at least being seen as having some of its characteristics. In market communication, images of aspirational groups are often used to communicate the message that the use of a particular product will help you belong to that aspirational group. Marketers try to identify the reference groups of their target markets. A reference group may be defined as an actual or imaginary individual or group with a significant influence on an individual's evaluations, aspirations or behaviour.7 Reference groups expose a person to new behaviours and lifestyles, influence the person's attitudes and self-concept, and create pres sures to conform that may affect the person's product and brand choices. The importance of group influence varies across products and brands. It tends to be strongest when the product or brand is visible and has a strong impact on the individual's self-view and image. High- involvement, fashionable and expensive products are thus likely to be typical of reference group influence. In most cases, reference groups have a stronger impact when they do things that are generally seen as desirable - doing good for society, earning a lot of money while at the same time helping disadvantaged people (Bill Gates is one example) or solving interna- tional crises. Word-of-mouth influence and buzz marketing Influencer (Opinion leader) – Person who, because of special skills, knowledge,personality or other characteristics, exerts social influence on others. Marketers of brands subjected to strong group influence must determine how to reach influencers, also named opinion leaders - people within a reference group who, because of special skills, knowledge, personality or a strong position in a tightly or loosely coupled social network, exert social influence on others, One study found that these influencers are 'four times more likely than average consumers to belong to five or more organizations, four times more likely to be considered experts, and twice as likely to recommend a product they like', Thus, their social coverage is vast. And when influential celebrities, professionals or friends talk, consumers listen, A number of survey studies emphasize that people trust 'recommendations from consumers's and this holds across different generations.9 Marketers often try to identify influencers for their products and direct marketing efforts towards them. They use buzz marketing by enlisting or even creating influencers to serve as 'brand ambassadors' who spread the word about their products. Many companies are now creating brand ambassador programmes in an attempt to turn influential but everyday customers into brand evangelists. Another example of buzz marketing used by many companies is the introduction of a new smartphone. By identifying, say, 100 ambassadors in social contexts that fit within the desired customer profile, and by choosing ambassadors with high credibility in the desired social setting, a buzz can be created with tens of thousands of people seeing the new phone within a few days. These very active ambassadors use them at work, with customers, with family and friends, and at parties, and they may even write about the new product on Internet forums or in blogs. This is likely to be a very effective marketing method, since it is relatively cheap and provides an oppor- tunity to influence the adoption-diffusion process of the new product (ee the end of the chapter). Online social networks range from blogs, e.g. Twitter and Sina Weibo (used in mainland China), to social networking websites, such as Facebook, LinkedIn, and more specialized sites.Academia.edu and researchgate.net are popular among researchers/academics. These sites are not very well known among the general public. The most important social networks to consider for marketers change over time, but the principle of being tuned in to sites where our actual and desired customers are congregating will not. Thus, an inactive company that doesn't follow its customers will run the risk of being outside the dialogue. Online social networks – Online platforms which people use to build social networks or social relation ship with other people who share similar personal or career interests, activities,. backgrounds or real-life connections. User-generated content Instead of throwing more one-way commercial messages in the path of ad-weary consumers marketers hope to use social networks to interact with consumers and become a part of their conversations and lives. Companies have the choice of participating in social media - if they don`t, users are likely to involve companies anyway. Here, an interesting divergence arises between user- generated content, also called grass roots information, and information supplied by companies. The former is likely to be honest, challenging, unstructured and quite frequently politically incorrect, and may be dangerous tO the company's brand. The latter is structured, politically correct and in line with corporate policies. However, there is a substan- tial risk particularly in light of the emerging communication landscape (see Chapter 13),10 that the company created information will appear boring and lacklustre. Consider the case of universities launching videos on YouTube com to attract new students. In some cases, student organizations have created videos that are funny, appealing and have been produced at low cost, just for the fun of it. In other cases, the Faculty of Arts and Sciences or the Univer- sity Head Office sets up a team of people to create a video on studying arts and sciences, or modern languages, often inspired by the huge success of videos from other universities. However, the results are often terrible. While student organizations can make a video on the funny side of being a student. with little or no consideration for what is politically correct, the faculty board or the central University unit is likely to undermine creativity (if it existed in the first place) by placing demands on the people participating in the video to reflect different student groups' interests, to consider equality among sexes, races and age groups, and avoid making any statements that might be harmful to the university's policies. What's more, it is likely to be very expensive both in term of personnel time and production costs. Family Family members can strongly influence buyer behaviour. The family is the most important consumer-buying organization in society, and it has been researched extensively. Marketers are interested in the roles and influence of parents and children - or any other combination of people at hand - in the buying of different products and services. The role of different household members varies widely by product category and by stage in the buying process. Buying roles change with evolving consumer lifestyles. There is also a strong cultural component, so the patterns will differ not only across regions in the world, but also across groups in a particular geographic area. Changes, not only in demographics and house- hold compositions but also in attitudes, suggest that marketers in industries that previously have sold their products to only men or only women are now courting the other gender. The development towards a higher degree of equality among the sexes in many product categories has at least two driving forces (and these may be overlapping): first, an ideologically based desire to increase equality, resulting in men buying an increasing percentage of food and clothing for their children, and women purchasing the family car; second, a broader set of purchase interests, e.g. women buying an increasing percentage of technological devices, and men increasingly buying face cream, clothing and hair care products. In addition, children have a strong influence on family buying decisions. A global survey showed that children from babies to teens - wield particular influence over their parents decisions as regards how money and free time are spent (71 and 70 per cent), where to go on vacation (64 per cent), how often to go out to eat 58 per cent), and where to live (43 per cent). Furthermore, the majority of parents felt that their kids exert more influence on family purchases than they did themselves when growing up." Roles and status A person belongs to many groups - family, clubs, unions and young people in particular project different identities and images in different contexts.2 The person's position in each group can be defined in terms of both role and status. A role consists of the activities a person is expected to perform according to the people around them. Each role carries a status reflecting the general esteem given to it by society. People usually choose products appropriate to their roles and status. Consider the various roles a mother plays. In her company, she plays the role of a brand manager; in her family, she plays the role of wife and mother; at her favourite sporting events, she plays the role of avid fan. As a brand manager, she willbuy the kind of clothing that reflects her role and status in her company. Personal factors A buyer's decisions are also influenced by personal characteristics, such as the buyer's age and life-cycle stage, occupation, economic situation. lifestyle, personality and self-concept. Age and life-cycle stage People change with regard to the goods and services they buy over their lifetime. Tastes in food, clothes, furniture and recreation are often age-related. Buying is also shaped by the stage of the family life cycle the stages through which families might pass as they mature over time. Marketers often define their target markets in terms of life-cycle stage, and develop appropriate products and marketing plans for each stage. There is also a generational component in this people are likely to maintain aspects of their consumption patterns as they mature, thus creating a change in the marketplace compared with the preceding generation. Traditional family life-cycle stages include young singles and married couples with children. Today, however, marketers are increasingly catering to a growing number of alternative, non-traditional stages such as unmarried couples, singles marrying later in life, childless couples, same-sex couples, single parents, extended parents (those with young adult children returning home) and others. Occupation A person's occupation affects the goods and services they buy, Executives buy more business suits than social workers do, while nurses and doctors, just like taxi drivers, bus drivers and airline captains are not particularly interested in buying day-to-day work clothes because their employers supply them. Marketers try to identify the occupational groups that have an above-average interest in their products. A company may even specialize in making products for a given occupational group or subgroup, e.g. pink stethoscopes for younger, fashion- oriented doctors or insurance packages for teachers, lawyers, or airline captains. Economic situation A person's economic situation will affect their product choice. Marketers of income-sensitive goods watch trends in personal income, savings and interest rates. If economic indica- tors point to a recession, marketers can take steps to redesign, reposition and reprice their products carefully. Some marketers target consumers who have lots of money and resources, charging prices to match. For example, Rolex positions its luxury watches as 'a tribute to elegance, an object of passion, a symbol for all time'. 0ther marketers target consumers with more modest means. The Swiss watchmaker Swatch makes more affordable watches, offering a low cost, high quality, and accurate watch with synthetic material". Lifestyle Lifestyle – A person's pattern of living as expressed in his or her psychographics People coming from the same subculture, social grade and occupation may have quite different lifestyles. Lifestyle is a person's pattern of living as expressed in his or her psycho- graphics. It involves measuring consumers' major ' AIo' dimensions - activities (work, hobbies, shopping, sports, social events), interests (food, fashion, family, recreation) and opinions (about themselves, social issues, politics, business, products). Lifestyle captures something more than the person's social grade or personality. It profiles a person's whole pattern of acting and interacting in the world. When used carefully, the lifestyle concept can help marketers understand changing consumer values and how they affect buying behaviour. Consumers don't just buy products, they buy the values and lifestyles those products represent. Gant or Lexington sell more than just clothing or home furnishings. They sell a lifestyle to which their customers aspire. Thus, people's product choices are becoming more and more like value choices. Accordingly, statements like 'I feel like this car, or this show, is more reflective of who 1 am` are becoming increasingly common. Personality and self-concept Each person's distinct personality influences his or her buying behaviour. Personality refers to the unique psychological characteristics that lead to relatively consistent and lasting responses to one's own environment, Personality is usually described in terms of traits such as self-confidence, dominance, sociability, autonomy, defensiveness, adaptability and aggres- siveness. Personality can be useful in analysing consumer behaviour in relation to certain product or brand choices. Brand personality – The specific mix of human traits that may be attributed to a particular brand. The idea is that brands also have personalities, and that consumers are likely to choose brands with personalities that match their own. A brand personality is the specific mix of human traits that may be attributed to particular brand. One researcher identified five brand personality traits: 1. Sincerity (down-to-earth, honest, wholesome and cheerful); 2. Excitement (daring, spirited, imaginative, and up-to-date); 3. Competence (reliable, intelligent, and successful); 4. Sophisication (upper class and charming); 5. Ruggedness (outdoorsy and tough). Most well-known brands are strongly associated with one particular trait: the car maker Jeep with ‘ruggedness', Apple with ‘excitement`, the British Broadcasting Corporation (BBC) with ‘competence', Jaguar and Estée Lauder with 'sophistication' and the Dove brand of soap with 'sincerity’. Hence, these brands will attract persons who are high on the same personality traits. Many marketers use a concept related to personality - a person's self concept (also called self image). The basic self-concept premise is that people's possessions contribute to and reflect their identities - that is, 'we are what we have. Mercedes-Benz ran a successful advertising campaign in the mid-1980s: 'You are what you drive' - with hindsight, it must have been very innovate at the time. In sum, in order to understand consumer behaviour, the marketer must first understand the relationship between consumer self-concept and possessions. Psychological factors A person's buying choices are further influenced by four major psychological factors: motiva- tion, perception, learning and beliefs and attitudes. Motivation A person has many needs at any given time. Some are biological, arising from states of tension such as hunger, thirst or discomfort. Others are psychological, arising from the need for recog nition, esteem or belonging. A need becomes a motive when it is aroused to a sufficient level of intensity. A motive (or drive) is a need that is sufficiently pressing to direct the person to seek satisfaction Psychologists have developed theories of human motivation. Two of the most popular the theories of psychologists Sigmund Freud and Abraham Maslow have quite different meanings for consumer analysis and marketing. Motive (drive) – A need that is sufficiently pressing to direct the person to seek to satisfy it. Freud assumed that people are largely unconscious about the real psychological forces shaping their behaviour. He saw the person as growing up and repressing many urges. These urges are never eliminated or under perfect control; they emerge in dreams, in slips of the tongue, in neurotic and obsessive behaviour, or ultimately in psychoses, Freud's theory suggests that a person's buying decisions are affected by subconscious motives that even the buyer may not fully understand. Thus, an ageing consumer who buys a sporty BMW M340i xDrive might explain that he simply likes the feel of the wind in his thinning hair. At a deeper level, he may be trying to impress others with his success. At a still deeper level, he may be buying the car to feel young and independent again. The term motivation research refers to qualitative research designed to probe consumers hidden, subconscious motivations. Consumers often don't know or can't describe why they act as they do. Thus, motivation researchers use a variety of probing techniques to uncover underlying emotions and attitudes toward brands and buying situations. Some companies employ teams of psychologists, anthropologists and other social scien- tists to carry out motivation research. One advertising agency routinely conducts one- on-one, therapy-like interviews to delve into the inner workings of consumers. Another company asks consumers to describe their favourite brands as animals or cars (say, cars VS. dogs; BMWS VS. Volvos) in order to assess the prestige associated with various brands. Still others rely on hypnosis, dream therapy or soft lights and mood music to plumb the murky depths of consumer psyches. Many marketers use such approaches, sometimes called interpretive consumer research, to delve into consumer psyches and develop better marketing strategies. Abraham Maslow sought to explain why people are driven by particular needs at particular times. Why does one person spend much time and energy on personal safety and another On gaining the esteem of others? Maslow's answer is that human needs are arranged in a hierarchy, as shown in Figure 6.3, from the most pressing at the bottom to the least pressing at the top. They include physiological needs, safety needs, social needs, esteem needs and self-actualization needs. A person tries to satisfy the most important need first. When that need is satisfied,it will stop being a motivator and the person will then try to satisfy the next most important need. For example, starving people (physiological need) will not take an interest in the latest happenings in the art world (self actualization needs), or in how they are seen or esteemed by others (social or esteem needs), or even in whether they are breathing clean air (safety needs). But as each important need is satisfied, the next most important need will come into play. Maslow's hierarchy of needs has been subject to a lot of criticism, 7 but it remains an important model in understanding various aspects of human behaviour not least because of its widespread understanding and use among scholars and practitioners from different disciplines. Perception A motivated person is ready to act. How the person acts is influenced by his or her own perception of the situation. All of us learn by the flow of information through our five senses: sight, hearing, smell, touch and taste. However, each of us receives, organizes and interprets this sensory information in an individual way. Perception is the process by which people select, organize and interpret information to form a meaningful picture of the world. People can form different perceptions of the same stimulus because of three perceptual processes: selective attention, selective distortion and selective retention. People are exposed to a great number of s stimuli every day, and thousands of marketing messages every day. In fact, it is very difficult to identify the number since there are various definitions and extensive disag reement about this among researchers. Nonetheless it is impossible for a person to pay attention to all these stimuli. Selective attention - the tendency for people to screen out most of the information to which they are exposed means that marketers must work especially hard to attract the consumer's attention. Perception – The process by which people select, organize and interpret information to form a meaningful picture of the world. Even noticed stimuli do not always come across in the intended way. Each person fits incoming information into an existing mindset, and each person's mindset is a bit different. Selective distortion describes the tendency of people to interpret information in a way that will support what they already believe. For example, if you distrust a company, you might perceive even honest adverts from the company as questionable. Another example is post-purchase bias: after having completed a purchase transaction consumers seek information that will support and confirm their choices. Thus, a person buying a Huawei mobile phone will pay more attention to tests where the Huawei was a test winner than to those where it did not do well. Think also about where people live, and how they - consciously and subconsciously -seek information that confirms their decision to live there, as well as their decision not to live in another place. Living in Copenhagen? No way! is as common in rural areas as 'No way would I ever consider living in a rural area' among citizens of Copenhagen, Stockholm or Oslo. Selective distortion means that marketers must try to understand the mindsets of consumers and how these will affect interpretations of advertising and sales information. Thus, an advert with appeal in rural Norrland may not work in the Öresund region or in the Helsinki area, and vice versa. People will also forget much of what they learn. They tend to retain information that supports their attitudes and beliefs. Because of selective retention, consumers are likely to remember good points made about a brand they favour and to forget good points made about competing brands. Because of selective attention, distortion and retention, marketers must work hard to get their messages through. This explains why marketers use SO much drama and repetition in sending messages to their market. Interestingly, at the same time as many marketers worry about whether their offers will be perceived at all, some consumers WOrry that they will be affected by marketing messages without even knowing it through subliminal advertising. In 1957, a researcher announced that he had flashed the phrases Eat popcorn' and 'Drink Coca-Cola' on a screen in a cinema every five seconds for 1/30oth of a second. He reported that although viewers did not consciously recognize these messages, they absorbed them subconsciously and bought 58 per cent more popcorn and 18 per cent more Coke. Suddenly advertisers as well as consumer- protection groups became intensely interested in subliminal perception. People voiced fears of being brainwashed, and Canada and the state of Cali fornia declared the practice illegal. Although the researcher later admitted making up the data, the concern is still there. Some consumers still fear that they are being manipulated by subliminal messages. Numerous studies by psychologists and consumer researchers have found little or no link between subliminal messages and consumer behaviour. Brainwave studies have found that, in certain circumstances, our brains may register subliminal messages. However, it. appears that subliminal advertising simply doesn't have the power attributed to it by its critics. Most advertisers scoffat the notion of an industry conspiracy to manipulate consumers through 'invisible" messages. One industry insider says that most marketers have dificulty in getting a 2 per cent increase in sales with the help of $50 million of media advertising and extremely sublirinal images ofs sex, money, power and other motivators of human emotion, and is thus sceptical about the idea of being able to manipulate consumers.' 18 In addition, consumers are getting more critical so companies have to develop increasingly powerful tools to deal with this development, e.g. neuromarketing (see Chapter 4). Learning Learning – Changes in an individual's behaviour arising from experience. When people act, they learn. Learning describes changes in an individual's behaviour arising from experience. Learning theorists suggest that most human behaviour is learned. Learning occurs through the interplay of drives, stimuli, cues, responses and reinforcement, A drive is a strong internal stimulus that calls for action. A drive becomes a motive when it is directed toward particulars stimulus object. For example, a person's drive for self-actualiza- tion might motivate him or her to look into buying a camera. The consumer's response to the idea of buying a camera is conditioned by the surrounding cues. Cues are minor stimuli that determine when, where and how the person responds. For example, the person might spot several camera brands in a shop window, hear of a special sale price or discuss cameras with a professional photograph. These are all cues that might influence a consumer's response to his or her interest in buying the product. Suppose the consumer buys an Acne dress. If the experience is rewarding, the consumer will probably use the dress more, and her response will be reinforced. Then, the next time she shops for a dress, or for jeans, a jacket or some similar product, the probability is greater that She will buy an Acne product. The practical significance of learning theory for marketers is that they can build up demand for a product by associating it with strong drives, using moti- vating cues and providing positive reinforcement. Beliefs and attitudes Belief – A descriptive thought that a person has about something. Through doing and learning, people acquire beliefs and attitudes. These, in turn, influence their buying behaviour. A belief is a descriptive thought that a person has about something. Beliefs may be based on real knowledge, opinion or faith, and may or may not carry an emotional charge. Marketers are interested n the beliefs that people formulate about specific products and services, because these beliefs make up product and brand images that affect buying behaviour. If some of the beliefs are wrong and prevent purchase, the marketer will want to launch a campaign to correct them. People have attitudes regarding politics, clothes, music, food and almost everything else Attitude describes a person's relatively consistent evaluations, feelings and tendencies towards an object or idea. Attitudes put people into a frame of mind of liking or disliking things, of moving towards or away from them. Our Acne clothes buyer may hold attitudes such as 'Buy the best, 'The Swedes make the best fashion items in the world, and Aesthetics and self-expression are among the most important things in life'. If so, the Acne dress would fit well into the consumer's existing attitudes. Attitude – A person's relativelyconsistent evaluations, feelings and tendencies towards an object or idea. Attitudes are difficult to change. A person's attitudes fit into a pattern that is both complex and difficult to understand , and to change one attitude may require difficult adjustments in many others. Thus, a company should usually try to fit its products into existing attitudes rather than attempt to change attitudes For example, Becel pro.activ butter reduces the level of harmful cholesterol, and eating carrots, in addition to being a healthy food ingredient and snack, has the advantage of putting some colour into the face, similar to tanning. We can now appreciate the many forces acting on consumer behaviour. The consumer's choice results from the complex interplay of various cultural, social, personal and psycho- logical factors. Types of buying decision behaviour Some purchases are simple and routine, even habitual. Others are far more complex- involving extensive information-gathering and evaluation - and are subject to sometimes subtle influences. For example, think of your buying behaviour for a tube of toothpaste, a party dress, an iPad, financial services and a ski trip - it is likely to differ greatly for each one. More complex decisions usually involve more buying participants and more buyer deliberation. Figure 6.4 shows types of consumer buying behaviour based on the degree of buyer involvement and the degree of differences among brands. Complex buying behaviour Consumers undertake complex buying behaviour when they are highly involved in a purchase and perceive significant differences among brands. Consumers may be highly involved when the product is expensive, risky, purchased infrequently and highly self expressive. Typically, the consumer has much to learn about the product category and there are a lot of emotions involved in all steps of the purchase process The buyer will pass through a learning process. first developing beliefs about the product, then attitudes, and then making a thoughtful purchase choice. Marketers of high-involve- ment products must understand the information-gathering and evaluation behaviour of high-involvement consumers. They need to help buyers learn about product-class attributes and their relative importance. They need to differentiate their brand's features, perhaps by describing the brand's benefits using print media with long copy. They must motivate store salespeople and the buyer's acquaintances to influence the final brand choice. Complex buying behaviour – Consumer buying behaviour in situations characterized by high involvement in a purchase and significant perceived differences among brands Dissonance-reducing buying behaviour Dissonance-reducing buying behaviour occurs when consumers are highly involved with an expensive, infrequent or risky purchase, but see little difference among brands. For example, consumers buying carpeting may face a high-involvement decision because carpeting is expensive and self-expressive. Yet buyers may consider most carpet brands in a given price range to be the same. In this case, because perceived brand differences are not large, buyers may shop around to learn what is available, but buy relatively quickly. They may respond primarily to a good price or to purchase convenience. Dissonance-reducing buying behaviour – Consumer buying behaviour in situations characterized by high involvement but few perceived differences among brands. After the purchase, consumers might experience post-purchase dissonance, a type of after-sale discomfort that arises when the consumer notices certain disadvantages of the purchased carpet brand or hear favourable things about brands not purchased. To counter such dissonance, the marketer's after-sale communications should provide evidence and support to help consumers feel good about their brand choices. Habitual buying behaviour Habitual buying behaviour – Consumer buying behaviour in situations characterized by low consumer involvement and few significantly perceived brand differences. Habitual buying behaviour occurs under conditions of low-consumer involvement and litle significant brand difference. Many groceries will be found here: let's take salt as an example, Consumers have little involvement in this product category - they simply go to the store and reach for a brand. If they keep reaching for the same brand, it is most likely out of habit rather than strong brand loyalty. Consumers appear to have low involvement with most low-cost, frequently purchased products. In such cases, consumer behaviour does not pass through the usual belief-attitudebehaviour sequence. Consumers do not search extensively for information about the brands, evaluate brand characteristics and make weighty decisions about which brands to buy. Instead, they passively receive information as they watch television or read magazines. Research: suggests that older buyers are more inclined to trust store personnel and rely less on marketing communications, while the opposite holds for Millennials/Generation Y buyers. Hence, infor. mation collection and marketing influence varies across buyer categories. Advertisement repetition creates brand familiarity rather than brand conviction. Consumers do not form strong attitudes towards a brand; they select the brand because it is familiar. Because they are not highly involved with the product, consumers may not evaluate the choice even after purchase. Thus, the buying process involves brand beliefs formed by passive learning, followed by purchase behaviour, which may or may not be followed by evaluation. Because buyers are not highly committed to any brands, marketers of low-involvement products with few brand differences often use price and sales promotions to stimulate product trial. In advertising for a low-involvement product, ad copy should stress only a few key points. Visual symbols and imagery are important because they can be remembered easily and associated with the brand. Variety-seeking buying behaviour Variety-seeking buying behaviour - Consumer buying behaviour in situations characterized by low consumer involvement but significant perceived brand differences. Consumers undertake variety-seeking buying behaviour in situations characterized by low consumer involvement but significant perceived brand differences. In such cases. consumers often do a lot of brand switching For example, when buying cookies or ice-cream, a consumer may hold some beliefs choose a cookie brand without much evaluation, and then evaluate that brand during consumption. But the next time, the consumer might pick another brand out ofl boredom Or simply to try something different. Assume you invite friends to your apart- ment and want to serve ice cream. The selection of flavours isn't a big deal, or is it? If you choose one or two weird flavours, some friends won't like them, but may on the other hand, some may love them? Brand, product or flavour switching occurs for the sake of variety rather than because of dissatisfaction. Recent evidence suggests that variety-seeking buying behaviour is on the increase, following a general trend in consumer markets of greater choice. Consumers' attitudes adapt to the new circumstances, and loyalty only comes when consumers find it attractive to stay with the same brand or retailer. In the case of variety-seeking purchase behaviour, the marketing strategy of the market leader may differ from that of minor brands. The market leader will try to encourage habitual buying behaviour by dominating shelf space, keeping shelves tully stocked, and running frequent reminder advertising. Challenger firms will encourage variety-seeking by offering lower prices, special deals, coupons, free samples and advertising that presents reasons for trying something new. The buyer decision process Now that we have looked at the influences that affect buyers, we are ready to look at how consumers mal ke buying decisions. The actual purchase decision is just part of a much larger buying process starting with need recognition and continuing through to how you feel after making the purchase. Marketers want to be involved throughout the buyer decision process. The buyer purchase process consists of five stages: need recognition, information search, evaluation of alternatives, purchase decision, post-purchase behaviour (Figure 6.5). The figure suggests that consumers pass through all five stages with every purchase. But in more routine purchases, consumers often skip or reverse some of these stages. A consumer buying her regular brand of toothpaste would recognize the need and go right to the purchase decision, skipping information search and evaluation. And a frequent traveller may not explore all opportunities to go from Copenhagen to Gothenburg but just book a train ticket with a provider he or she likes However, we use the model in Figure 6.5 since it shows all the considerations that arise when a consumer faces a new and complex purchase situation. In most cases, the buying process starts long before the actual purchase and continues long afterwards. Some criticism has been directed towards the rational nature of the purchase process and the sequential order of the stages, in particular.?1 Marketers need to focus on the entire buying process rather than just the purchase decision. Buyers may pass quickly or slowly through these stages, and some of the stages may even be reversed. For instance, person buying a summer home, a sailing boat, or a holiday to Mexico is likely to be emotion- ally involved and sensitive to service experiences during the purchase process that don't live up to expectations. A car that breaks down, low- quality paintwork and landscaping at the summer home or poor attitude of the travel agent are things that reduce the overall service experience. Need recognition The buying process starts with need recognition - the buyer recognizes a problem or need. The need can be triggered by internal stimuli when one of the person's normal needs hunger, thirst, sex- rises to a level high enough to become a drive A need can also be trig- gered by external stimuli. For example, an advertisement or a discussion with a friend might get you thinking about buying new sports equipment. At this stage, the marketer should research consumers to find out what kinds of needs or problems arise, what brought them about, and how they led the consumer to this particular p product. Information search Information search – The consumer may store a need In their memory or undertake an intormation search related to the need. An interested consumer may Or may not: search for more information. If the consumer's need is strong and a satisfactory product is near to hand, the consumer is likely to buy it there and then. If not, the consumer may store the need in their memory or undertake an information search related to the need once again, a higher degree of consumer involvement means more research and considerations undertaken in each step of the purchase process. For example, once you* ve decided you would like to buy a new sailing boat, you will probably pay more attention to boat adverts, boats owned by friends and boat conversations. Or you may actively search the web, talk to friends and gather information in other ways. The amount of searching you do will depend on the strength of your drive, the amount of information you start with, the ease of obtaining more information, the value you place on additional informa tion and the satisfaction you get from searching. Consumers can obtain information from any of several sources. These include personal sources (family, friends, neighbours, acquaintances), commercial sources (advertising, sales: people, dealer websites, packaging, displays), public sources (mass media, consumer rating organizations, Internet searches) and experiential sources (handling, examining, using the product e.g. test-driving the scooter). The relative influence of these information sources varies with the product and the buyer. At least hitherto, the consumer has received the most information about a product from commercial sources - those controlled by the marketer. Although a lot of information on the Internet claims to be independent it is nonetheless under the influence of site and brand owners, marketers, advertisers and users who try to integrate commercial messages. Grass roots information increases in importance and makes it increasingly difficult for marketers to convince buyers, at least to the extent that marketing messages deviate from what grass roots sources say. The most effective sources, however, tend to be personal. Commercial sources normally inform the buyer, but personal sources legitimize or evaluate products for the buyer. This appears to hold for all generations but is even stronger among young people who are less loyal and use faster communication vehicles.23 It's rare that an advertising campaign can be as effective as a friend or neighbour leaning over the fence and saying, 'This is a wonderful product. Increasingly, that "neighbour's fence' is a digital one. Today, consumers share product opinions, images, and experiences freely across social media. And buyers can find an abun- dance of user-generated reviews alongside the products they are considering at sites ranging from Amazon.com to specialized sites for more narrow product and interest groups such as freeride.se, Tripadvisor.com. AS more information is obtained, the consumer's awareness and knowledge of the available brands and features increases, and the information might also help the consumer to drop certain brands from consideration. A company must design its marketing mix to make pros pects aware of and knowledgeable about its brand. It: should carefully identify consumers' sources of information and the importance of each source Evaluation of alternatives Alternative evaluation – The stage of the buyer decision process in which the consumer uses information to evaluate alternative brands in the choice set. How does the consumer choose among the alternative brands? The marketer needs to know about alternative evaluation that is, how the consumer processes information to arrive at brand choices. Consumers do not use a simple and single evaluation process in all buying situations. Instead, several evaluation processes are at work. The consumer arrives at attitudes towards different brands through an evaluation proce- dure. How consumers go about evaluating purchase alternatives depends on the individual consumer and the specific buying situation. In some cases, consumers use careful calcula- tions and logical thinking. At other times, the same consumers do little or no evaluating: instead they buy on impulse and rely on intuition. Sometimes consumers make buying decisions on their own; sometimes they turn to friends. consumer guides or salespeople for buying advice. On other occasions. they distrust salespeople and ask friends who happen to be experts in the field. Suppose you've narrowed your car choices to three brands. And suppose that you are primarily interested in four attributes - styling, brand image, operating economy and price. By this time you've probably formed beliefs about how each brand rates on each attribute. If one car rated best on all the attributes, we could predict that you would choose it. However, the brands will no doubt vary in appeal. You might base your buying decision on only one attribute, e.g. styling above everything else, and you would buy the car that you think has the best styling. But most buyers consider several attributes, each with a different importance. If we knew the importance that you assigned to each of the four attributes, we could predict your car choice more reliably. Researchers in the field of social cognitive research suggest that the ranking or weight of each criterion may only be used when approaching the purchase decision if the criterion supports the individual's feelings and intuition thus arguments are used to support or reject a decision that has already been made. In the case of buying a car, the warranty may thus be used as a criterion if the desired car comes with an extensive warranty package but may not be included at all in the decision if the desired car lacks a warranty package. If marketers know what evaluative processes go on, they can take steps to influence the buyer's decision. Purchase decision Purchase decision – generally a consumers decision to buy the most preferred object or brand. In the evaluation stage, the consumer ranks products and brands, and forms purchase inten- tions. Generally, the consumer's purchase decision will be to buy the most preferred product or brand, but two factors can come between the purchase intention and the purchase decision. The first factor is the attitudes of others, If someone important to you thinks that you should buy the more expensive cat, then the chances of you buying a more expensive car are higher. Says one car buyer: Td decided to go for the smallest engine, but the salesman told me only older people choose the smallest engine. And I didn't want to be that person, so I paid 10 per cent more for a 2.5 litre engine. The second factor is unexpected situational factors. The consumer may form a purchase inten- tion based on factors such as expected income, expected price and expected product benefits. However, unexpected events may change the purchase intention. For example, the economy might take a turn for the worse, a close competitor might drop their price, a friend working for a competitor may lose his or her job, or a friend might report being disappointed in your preferred car. Thus, preferences and even purchase intentions do not always result in actual purchase choice. Post-purchase behaviour Post-purchase behaviour – The stage of the buyers decision process in which consumers take further action after purchase, based on their satisfaction or dissatisfaction. The marketer's job does not end when the product is bought. After purchasing the product, the consumer will be satisfied or dissatisfied and will engage in post-purchase behaviour - which is of great interest to the marketer. What determines whether the buyer is satisfied or dissatisfied with a purchase? The answer lies in the relationship between the consumer's expectations and the product's perceived performance. If the product falls short of expectations, the consumer is disappointed; if it meets expecta- tions, the consumer is satisfied; if it exceeds expectations, the consumer is delighted. The larger the gap between expectations and performance,the greater the consumer's dissat- isfaction. This suggests that sellers should promise only what their brands can deliver so that buyers are satisfied. Cognitive dissonance – Buyers discomfort caused by post-purchase conflict. Almost all major purchases result in cognitive dissonance, or psychological discomfort caused by post-purchase conflict. After the purchase, consumers are satisfied with the benefits of the chosen product or brand and are glad to avoid the drawbacks of the products and brands that were not bought. However, every purchase involves compromise, Consumers may feel uneasy about the drawbacks of the chosen product or brand and about losing the benefits of the products and brands not purchased. Thus, consumers feel at least some post- purchase dissonance for every purchase.2s A typical example is a young couple moving from the centre of a fairly big city to a house in the suburbs - more time will be spent on house maintenance and travel to work, and a feeling of not being young anymore may contribute to post-purchase dissonance. Longing back to the good, old days in the city centre activates cognitive dissonance. Post-purchase behaviour is strongly linked to customer satisfaction. Why is it so impor- tant to satisfy the customer, despite the fact that sending too many surveys might irri- tate customers? Customer satisfaction is a key to building profitable relationships with consumers to keeping and growing consumers and reaping their customer lifetire value. Satisfied customers are more likely to buy a product again, talk favourably to others about the product, pay less attention to competing brands and advertising, and buy other products from the company. And last but not least, they talk to others about their experiences, regardless of whether they will buy the product again. Even if the satisfied customer may switch brands, it makes a huge different if the person is happy. Says a car buyer who switched from Volvo to Audi: 'I was perfectly happy with the Volvo, I just wanted something different after six brand new Volvos' - so he continues to spread the word of being happy with the Volvos. A dissatisfied consumer responds differently. Bad word of mouth information often travels farther and faster than good word of mouth information. It can quickly damage consumer attitudes about a company and its products. But companies cannot simply rely on dissatisfied customers to volunteer their complaints when they are dissatisfied. Most unhappy customers never tell the company about their problem. Therefore, a company should measure customer satisfaction regularly. It should set up systems that encourage customers to complain. In this way, the company can learn how well it is doing and how it can improve. Here, it's once again important to distinguish between high-involvement and low-involve- ment products. In the former case, a brand or product falling short of buyer expectations may result in many complaints to the selling company, a substantial amount of negative word-of-mouth information both in the social environment and on Internet forums. For low- involvement products, consumers often don't have the energy and motivation to take specific actions if they are dissatisfied, e.g. a new yoghurt flavour, low-sugar ketchup or a magazine that doesn't live up to expectations. By studying the overall buyer decision, marketers may be able to find ways to help consumers move through various steps of the customer journey, including those with obstacles involved. For example, if consumers are not buying a new product because they do not perceive a need for it, marketing might launch advertising messages that trigger the need and show how the product solves customers' problems. If customers know about the product but are not buying because they hold unfavourable attitudes toward it, the marketer must find ways to change either the product or consumer perceptions. Much depends on the nature of the buyer, the product and the buying situation, and the approach used will depend on the extent to which it is possible to treat different customer groups differently - for low-involvement products like groceries, it is often not done. Mass market approaches are likely to be applied instead eg outdoor advertising, television commercials, campaigns with Coop and IcA, outdoor advertising etc. For expensive, high-involvement products, marketers spend a lot of time, money and energy to help the customer move through the purchase process and here, approaches targeted towards particular consumer groups and profiles are used. When BMW launches new 3 Series model, personal invitations for a test- drive to owners of Audi A4, Mercedes- Benz C Class, and Volvo s0 cars will be expensive on a pure cost-per-contact basis, but very effective in terms of finding customers who are likely to buy the car and also the customers they want. By its very nature. owners of cars in the same segment are a key target group. The customer journey In a wider sense, the customer journey identifies all the touch points a company has with a customer - in the pre-purchase stage, during the purchase, and post purchase. Previous experiences influence each step, and have an impact on future experiences.2 The customer journey approach is wider and more complex than the purchase process, and it attempts to catch the dynamic nature of many purchases. It builds on an assumption of relationships existing between consumers and companies while the purchase process in a more narrow sense focuses on purchases as transactions. Understanding the customer journey over time is critical for firms. Since consumers interact with firms through many touch points in various channels and media channels it's crucial to identify pain points. A typical example is product delivery - a consumer who buys an expensive piece of clothing or computer may have a very joyful experience from marketing, customer support, other users, online reviews and the online ordering process - but if the delivery, often outsourced based on low cost - doesn't live up to what the company promises and the buyer expects, the customer experi- ence will be mixed. The buyer decision process for new products We will now look at how buyers approach the purchase of new products. A new product is a product, service or idea that is perceived by many potential customers as new. It may have been around for a while, but our interest is in how consumers learn about products for the first time and make decisions on whether to adopt them. We define the adoption process as 'the mental process through which an individual passes from first learning about an innova- tion to final adoption", and adoption as the decision by an individual to become a regular user of the product. Stages in the adoption process Consumers go through five stages in the process of adopting a new product: Awareness: the consumer becomes aware of the new product but lacks information about it. Interest: the consumer seeks information about the new product. Evaluation: the consumer considers whether trying the new product makes sense,. Trial: the consumer tries the new product on a small scale to improve his or her estimate its value. Adoption: the consumer decides to make full and regular use of the new product. This model suggests that the new-product marketer should think about how to help consumers move through these stages. For example, coupons that offer substantial savings Or a free sample may be used to encourage consumers to try product. A premium car producer might find that many potential customers know about and are interested in jtS new model but aren't buying because of uncertainty about the model's benefits and the high price. The producer could launch a 'take one home for the weekend" promotion to high-value prospects to move them into the trial process and lead them to purchase. Individual differences in innovativeness People differ greatly in their readiness to try new products. In each product area, there are "consumption pioneers` and early adopters. 0ther individuals adopt new products much later. People can be classified into the adopter categories shown in Figure 6.7. After a slow start, an increasing number of people adopt the new product. The number of adopters reaches a peak and then drops off as fewer non-adopters remain. Innovators are defined as the first 2.5 per cent of the buyers to adopt a new idea (those beyond two standard deviations from mean adoption time); the early adopters are the next 13.5 per cent (between one and two standard deviations); and so forth. The five adopter groups have differing values. Innovators are venturesome - they try new ideas at some risk. Early adopters are guided by respect - they are opinion leaders in their communities and adopt new ideas early but carefully. The early mainstream are deliberate although they are rarely leaders, they adopt new ideas before the average person. The late mainstream are sceptical - they adopt an innovation only after a majority of people have tried it. Finally, lagging adopters are tradition-bound - they are suspicious of changes and adopt the innovation only when it has become something of a tradition itself. From a marketing perspective, lagging adopters are not very interesting since their spending is comparatively small, and lagging adopters may be dangerous to the brand for a company that wants to attract dynamic and progressive people. This adopter classification suggests that an innovating firm should research the character istics of innovators and early adopters and should direct marketing efforts toward them. In general, innovators tend to be relatively younger, better-educated and higher earners than later adopters and non-adopters. They are more receptive to unfamiliar things, rely more on their own values and judgment, and are more willing to take risks. They are less brand-loyal and more likely to take advantage of special promotions such as discounts, coupons and samples. Influence of product characteristics on rate of adoption The characteristics of the new product affect its rate of adoption. Some products catch on almost overnight, as has been the case with several new iPhones, while others take a longer time to gain acceptance. For example, digital SLR cameras, pay-per view technology, and LED headlights for cars have shown very slow adoption. The same holds for cloud storage and cloud technology, and 3D printing. Five characteristics are especially important in influencing an innovation's rate of adoption. For example, consider the characteristics of all-electric vehicles in relation to their rate of adoption: Relative advantage. The degree to which the innovation appears superior to existing prod- ucts. All-electric cars require no gas and use clean, less costly energy. This will accelerate their rate of adoption. However, they have limited driving range before recharging and cost more initially, which will slow the adoption rate. Compatibility. The degree to which the innovation fits the values and experiences of potential consumers. Electric cars are driven the same way as petrol or gas-powered cars. However, they are not compatible with the nation's current refuelling network. Plug-in electric charging stations may not cover all areas and there might be waiting times for charging. Increased adoption will depend on the quality of the network of recharging stations, which may take considerable time. Complexity. The degree to which the innovation is difficult to understand or use. Electric cars are not different or complex to drive, which will help to speed up adoption,. Divisibility. The degree to which the innovation may be tried on a limited basis, Consumers can test-drive electric cars, a positive for the adoption rate. The development of prices for buving and taxes for driving electric vehicles will influence the rate of adoption. Communicability. The degree to which the results of using the innovation can be observed or described to others. To the extent that electric cars lend themselves to demonstration and description, their use will spread faster among consumers. Other characteristics influence the rate of adoption, such as initial and ongoing costs, risk and uncertainty, and social approval, The new product marketer must research all these factors when developing the new product and its marketing programme. SUMMARY The world consumer market consists of almost eight billion people, and they vary greatly in age, income, education level and tastes. Understanding how these differences affect consumer buying behaviour is one of the biggest challenges marketers face. The consumer market consists of all the individuals and households who buy or acquire goods and services for Personal consumption. The simplest model of consumer buyer behaviour is the stimulus-response model. According to this model, marketing stimuli (the four n Ps) and other major forces (economic, technological, political, cultural) enter the consumer's *black box and produce certain responses. Once in the black box, these inputs produce observable buyer responses, such as product choice, brand choice, purchase timing and purchase amount. Consumer buyer behaviour is influenced by four key sets of buyer characteristics: cultural, social, personal and psychological. Although many of these factors cannot be influenced by the marketer, they can be useful in iden- tifying interested buyers and in shaping products and appeals to serve consumer needs better. Culture is the most basic determinant of a person's wants and behav- iour. It includes the basic values, perceptions, preferences and behaviours that a person learns from family and other important institutions. Subcultures are 'cultures within cultures' that have distinct values and lifestyles and can be based on anything from age to ethnicity. People with different cultural and subcultural characteristics have different product and brand preferences. Social factors, e.g. a person's reference groups - family, friends, social networks, professional associations -strongly affect product and brand choices. The buyer's age, life-cycle stage, occupation, economic circumstances, lifestyle, personality and other personal characteristics influence his or her buying decisions. Consumer lifestyles -the whole pattern of acting and interacting in the world - are also an important influence on purchase decisions. Finally, consumer buying behav- iour is influenced by psychological factors - motivation, perception, learning, and beliefs and attitudes. Buying behaviour may vary greatly across different types of products and buying decisions. Consumers undertake complex buying behaviour when they are highly involved in a purchase and perceive significant differences among brands. Dissonance-reducing behaviour occurs when consumers are highly involved but see little difference among brands. Habitual buying behaviour occurs under conditions of low involvement and little significant brand difference. In situations characterized by low involvement but significant perceived brand differences, consumers engage in variety-seeking buying behaviour. When making a purchase, the buyer goes through a decision process. During need recognition, the consumer recognizes a problem or need that could be satisfied by a product or service in the market. Once the need is recognized, the consumer is stimulated to seek more information and moves into the information search stage. With information in hand, the consumer proceeds to alternative evaluation, during which the information is used to evaluate brands in the choice set. From there, the consumer makes a purchase decision and actually buys the product. In the final stage of the buyer deci- sion process, post-purchase behaviour, the consumer takes action based on satisfaction or dissatisfaction. However, not all purchase decisions follow this order. There are individual differences in innovativeness. The customer journey takes a wider approach and attempts to identify all the touch points company has with a customer in the pre-purchase stage, during the purchase, and post-purchase. People differ greatly in their readiness to try new products. Five adopter groups have differing values: innovators, early adopters, early mainstream, late mainstream and lagging adopters,. The characteristics of new products affect their rate of adoption. Relative advantage, compatibility, complexity, divisibility and communicability determine the rate of adoption. The product-adoption process comprises five stages: awareness, interest, evaluation, trial and adoption. Initially, the consumer must become aware of the new product. Awareness leads to interest, and the consumer seeks information about the new product. Once infor- mation has been gathered, the consumer enters the evaluation stage and considers buying the new product. Next, in the trial stage, the consumer tries the product on a small scale to improve his or her estimate of its value. If the consumer is satisfied with the product, he or she enters the adoption stage, deciding to use the new product fully and regularly. With regard to diffusion of new products, consumers respond at different rates, depending on their charac- teristics and the product's characteristics. Innovators are willing to try risky new ideas; early adopters - often community opinion leaders- accept new ideas early but carefully; the early majority -- rarely leaders decide deliberately to try new ideas, doing so before the average person does; the late majority try an innovation only after a majority of people have adopted it; whereas lagging adopters adopt an innovation only after it has become a tradition itself. Manufacturers try to bring their new products to the attention of poten- tial early adopters, especialy those who are opinion leaders. Key terms Adoption process Alternative evaluation Attitude Belief Brand personality Cognitive dissonance Complex buying behaviour Consumer buyer behaviour Consumer market Dissonance-reducing buying behaviour Habitual buying behaviour Influencer (Opinion leader) Information search Learning Lifestyle Motive (drive) New product Online social networks Perception Post-purchase behaviour Purchase decision Social grade Subculture Variety-seeking buying behaviour