Chapter 7 Analyzing Consumer Markets and Buyer Behavior

Chapter 7

Analyzing Consumer Markets and Buyer Behavior

Learning Objectives

After reading this chapter students should:

• Understand the major factors influencing consumer behavior
• Know and recognize the types of buying decision behavior        
• Understand the stages in the buying decision process

Chapter Outline

1. Influencing buyer behavior

1. Cultural factors

1. Culture—values, perceptions, and preferences that are the most fundamental determinant of a person’s wants and behavior
2. Subcultures—nationalities, religions, racial groups, geographical regions
3. Social class—hierarchically ordered divisions in a society; members share similar values, interests and behavior (see Table 6-1)

1. Social factors

1. Reference groups—all groups that have an influence on attitudes or behavior
2. Family—the most influential primary reference group
3. Roles and statuses—activities a person is expected to perform and the status associated with each

1. Personal factors

1. Age and life-cycle stage—people buy different goods over their lifetime
2. Occupation and economic circumstances

1. Blue collar versus white collar
2. Spending income, savings and assets, debts, borrowing power, and attitude toward spending versus saving—all impact product choice

1. Lifestyle—pattern of living as expressed by activities, interests, opinions
2. Psychographics—the science of using psychology demographics to better understand consumers (VALS)
3. Personality and self-concept—personality characteristics that influence buying behavior (self-confidence, socialibility, etc., and ties to brand personality
4. Psychological factors

1. Motivation—correlated to the strength of a need (Freud, Maslow, Herzberg)
2. Perception—selective attention, selective distortion, selective retention
3. Learning—changes in behavior arising from experience
4. Beliefs and attitudes—a belief is a descriptive thought a person holds about something; an attitude is a person’s enduring favorable or unfavorable evaluations, emotional feelings, and action tendencies toward some object or idea

1. Buying decision process

1. Buying roles—five different roles: initiator, influencer, decider, buyer and user
2. Buying behavior

1. Complex buying behavior—high involvement, significant difference among brands
2. Dissonance-reducing buying behavior—high involvement, little or no perceived difference among brands. Purchase is fairly quick
3. Habitual buying behavior—low involvement, little or no brand difference
4. Variety-seeking buying behavior—low involvement but perceived significant brand differences. May occur to relieve boredom

1. Stages in the buying decision process

1. Problem recognition—difference between actual state and desired state
2. Information search—both internal and external sources
3. Evaluation of alternatives—different process for every consumer, involves weighing product attributes and their ability to deliver benefits
4. Purchase decision—form a preference and intention to buy. Actual purchase can be influenced further by attitudes of others and unanticipated situational factors
5. Post purchase behavior

1. Post purchase satisfaction—understanding the differences between buyer expectation and the product’s perceived performance. Minimizing the gap and achieving truthful representation
2. Post purchase actions—satisfaction or dissatisfaction will lead to subsequent behavior that can have both positive and negative effects
3. Post purchase use and disposal—learning more about use and disposal aids follow-on marketing and to enhance ecological awareness

1. Other models of the buying decision process

1. Health model—moving people to adopt healthful behaviors (smoking, diet, exercise)
2. Customer activity cycle model—mapping the pre, during, and post phases of behavior toward a specific task

1. Summary

Overview

In addition to a company’s marketing mix and factors present in the external environment, a buyer is also influenced by personal characteristics and the process by which he or she makes decisions. A buyer’s cultural characteristics, including values, perceptions, preferences, and behavior learned through family or other key institutions, is the most fundamental determinant of a person’s wants and behavior. Consumer markets and consumer buying behavior have to be understood before sound marketing plans can be developed.

The consumer market buys goods and services for personal consumption. It is the ultimate market in the organization of economic activities. In analyzing a consumer market, one needs to know the occupants, the objects, and the buyers’ objectives, organization, operations, occasions, and outlets.

The buyer’s behavior is influenced by four major factors: cultural (culture, subculture, and social class), social (reference groups, family, and roles and statuses), personal (age and life-cycle state, occupation, economic circumstances, lifestyle, and personality and self-concept), and psychological (motivation, perception, learning, and beliefs and attitudes). All of these provide clues as to how to reach and serve buyers more effectively.

Before planning its marketing, a company needs to identify its target consumers and their decision processes. Although many buying decisions involve only one decision-maker, some decisions may involve several participants who play such roles as initiator, influencer, decider, buyer, and user. The marketer’s job is to identify the other buying participants, their buying criteria, and their influence on the buyer. The marketing program should be designed to appeal to and reach the other key participants as well as the buyer.

The amount of buying deliberateness and the number of buying participants increase with the complexity of the buying situation. Marketers must plan differently for four types of consumer buying behavior: complex buying behavior, dissonance-reducing buying behavior, habitual buying behavior, and variety-seeking buying behavior. These four types are based on whether the consumer has high or low involvement in the purchase and whether there are many or few significant differences among the brands.

In complex buying behavior, the buyer goes through a decision process consisting of need recognition, information search, evaluation of alternatives, purchase decision, and postpurchase behavior. The marketer’s job is to understand the buyer’s behavior at each state and what influences are operating. This understanding allows the marketer to develop an effective and efficient program for the target market.