ANALYZING CONSUMER MARKETS AND BUYER BEHAVIOR By Agung

ANALYZING CONSUMER MARKETS AND BUYER BEHAVIOR By : Agung Utama

introduction The aim of marketing is to meet and satisfy target customer’s needs and wants. The field of consumer behavior studies how individuals, groups, and organizations select, buy, use and dispose of goods, services, ideas, or experiences to satisfy their needs and desires. Understanding consumer behavior and knowing customers is never simple. Customers may say one thing but do another.

Influencing buyer behavior The starting model for understanding buyer behavior is “stimulus response-model” The model describes that marketing and environmental stimuli enter the buyer’s consciousness. The buyer’s characteristics and decision processes lead to certain purchase decisions. The marketer’s task is to understand what happen in the buyer’s consciousness between the arrival of outside stimuli and the purchase decisions.

Model of buyer behavior. Marketing stimuli • Product • Price • Place • promotion Other stimuli • economic • technlg • Political • cultural Buyer’s charactristi cs • Cultural • Social • Personal • psychologic al Buyer’s Decision process • Problem recognition • Information search • Evaluation of alternatives • Purchase decision • Post purchase behavior Buyer’s Decision • Product choice • Brand choice • Dealer choice • Purchas e timing • Purchas e amount

Cultural factors Culture is the fundamental determinant of a person’s wants and behavior. A person acquires a set of values, perceptions, preferences, and behaviors through his or her family and other key institutions. Each culture consists of smaller sub culture that provide more specifications and socialization for their members. Sub cultures include nationalities, religions, racial groups, and geographic regions. When subcultures grow large enough, companies often design specialized marketing programs to serve them.

Social factors Reference groups : consists of all the groups that have a direct or indirect influence on the person’s attitudes or behavior. Groups having a direct influence on a person are called memberships groups, such as: family, neighbors, friend, etc. Family Two kind of families in the buyer’s life : 1. The family of orientation: consists of parents and siblings. From parents a person acquires an orientation toward religion, politics, economics, sense of personal ambitions. 2. The family of procreation : consists of one’s spouse and children.

Roles and status A role consists of the activities a person is expected to perform. Each role carries a status. People choose products that communicate their role and status in society. Personal factors Age and stage in the life cycle : people buy different goods and services over a lifetime. Occupation and economic circumstances. Occupation influences consumption patterns, such as: a blue collar worker will buy work clothes, work shoes, lunch-box, while a company presidents will buy expensive suits, air travel, and country club memberships.

Life style People from the same culture, social class, and occupation may lead quite different lifestyles. A lifestyle is a person’s pattern of living in the world as expressed in activities, interests and opinions. Marketers search for relationships between their products and lifestyle groups. Personality and self-concept each person has personality characteristics that influence his or her buying behavior. Personality is often described in term of such as self confidence, dominance, autonomy, deference, sociability, defensiveness, and adaptability. Personality can be useful variable an analyzing consumer brand choices. The idea is that brands also have personalities, and that consumers are likely to choose brands whose personalities match their own.

Psychological factors Motivations Maslow’s Theory: human’s needs ate arranged in a hierarchy, from the most pressing to the least pressing. In order of importance, they are physiological needs, safety needs, social needs, esteem needs, and self-actualization needs. People will try to satisfy their important first needs, when a person succeeds in satisfying an important needs, he or she will then try to satisfy the nextmost-important needs.

5. Self. Actualization Needs 4. Esteem Needs 3. Social needs (love) 2. Safety needs (security) 1. physiological needs (food, water, shelter)

Perception A motivated person is ready to act, how the motivated person actually acts is influenced by his or her perception of the situations. Perceptions can vary widely among individuals exposed to the same reality. One person might perceive fast talking salesperson as aggressive , another, as intelligent and hekpful. People can emerge with different perceptions of the same object because of three perceptual processes: selective attention, selective distortion, selective retention.

Beliefs and attitudes A belief is a descriptive thought that a person hold about something. People’s belief about product or brand influence their buying decisions. Marketers are interested in the beliefs people carry in their heads about their products and brands. Brands beliefs exist in consumer’s memory. Attitudes is a person’s enduring favorable or unfavorable evaluations, emotional feelings, and actions tendencies toward some object or idea. A person’s attitude settle into a consistent pattern, so a company would be well advised to fit its product into existing attitude rather than to try to change attitudes might pay off.

The buying decisions process Marketers have to go beyond the various influence on buyers and understanding how consumers actually make their buying decisions. Specifically marketers must identify who makes the buying decisions, the types of buying decisions, and the step in the buying decisions.

Buying roles change so the marketers must be careful in making their targeting decisions. We can distinguish five roles people play in buying decisions: Initiator : the person who first suggests the idea of buying the product or service. Influencer : the person whose view or advice influences the decisions. Decider : the person who decides on any component of a buying decisions : whether to buy, what to buy, how to buy, where to buy. Buyer : the person who makes the actual purchase User : the persons who consumes or uses the product or service.

Buying behavior Henry Assael distinguished four types of consumer buying based on the degree of buyer involvement and the degree of differences among brands. High Involvement Significant differences between brands Few differences between brands Low Involvement Complex buying behavior Variety seeking buying behavior Dissonance reducing buying behavior Habitual buying behavior

Complex buying behavior Consumers engage in complex buying behavior when they are highly involved in a purchase and aware of significant differences among brands. This is usually the case when a product is expensive, bought infrequently, risky, and highly self –expressive, like an automobiles. Dissonance reducing buyer behavior Consumers sometimes engage in highly involved in a purchase but sees little differences in brands. The high involvement based on the fact that the purchase is expensive, infrequent, and risky. In this case the buyer will shop around to learn what is available. If they find quality differences in the brands, they might go for the higher price. If they find little differences, they might simply buy on price or convenience.

Habitual buying behavior Many products are bought under conditions of low involvement and the absence of significant brand differences, for example: salt. There is good evidence that consumers have low involvement with most low-cost, frequently purchased products. Variety seeking buying behavior Some buying situations are characterized by low involvement but significant brand differences. Here consumers often do a lot of brand switching. Brand switching occurs for the sake of variety rather than dissatisfaction.

Stages of the buying decisions process Five stage model of the consumer buying process. Problem Recognition Informatio n search Evaluation Of Alternative s Purchase Decisions Post purchase Decisions

Problem recognition The buying process starts when the buyer recognize a problem or need. The need can be triggered by internal or external stimuli. Marketers need to identify the circumstances that trigger a particular need. Information search An aroused consumer will be inclined to search more information. Two levels of arousal consumer: Heightened attention : a person simply becomes more receptive to information about product Active information search : a person who looking for reading material, phoning friends, and visiting stores to learn about product. Consumer information sources: Personal sources : family, friends Commercial sources : advertising, sales persons Public sources : mass media

Through gathering information, the consumer learns about competing brands and their features as depicted follows: Total sets IBM APPLE DELL HWELETT -P TOSHIBA COMPAQ NEC AXIOO ZYREX Awareness set IBM APPLE TOSHIBA COMPAQ AXIOO ZYREX Consideration set Decision IBM TOSHIBA COMPAQ AXIOO Choice set ?

Evaluation of alternatives Some basic concepts will help us understand consumer evaluation process: First: The consumer is trying to satisfy needs Second: The consumers is looking for certain benefits from the product solution Third: The consumers sees each product as a bundle of attributes with varying abilities for delivering benefits sought to satisfy this needs. The attributes of interest to buyers vary by product: Cameras: picture sharpness, camera speeds, camera size Hotels: location, cleanliness, price, atmosphere Tires: safety, tread life, price, ride quality. Mouthwash: color, effectiveness, germ-killing capacity, price, taste/flavor Consumers will pay the most attention to attributes that deliver the sought benefits.

Purchase decisions In the evaluation stage, the consumers form preferences among the brands in the choice set. The consumers may also form an intention to buy the most preferred brand. How ever two factors can intervene between the purchase intention and the purchase decision. The first factor is the attitudes of others. The extent to which another person’s attitude reduces one’s preferred alternatives depends on two things: The intensity of the other person’s negative attitude toward the consumer’s preferred alternative The consumer’s motivation to comply with the other person’s wishes The second factor is unanticipated situational factors that may erupt to change the purchase intention. In executing a purchase intention, the consumers may make up to five purchase sub decisions: a brand decisions, vendor decisions, quantity decisions, timing decisions, payment method decisions.

Steps between evaluation of alternatives and a purchase decision. Attitudes of others Evaluation of alternatives Purchase decisions Purchase intentions Un anticipated Situational factors

Post purchase behavior After purchasing the product, the consumer will experience some level of satisfaction or dissatisfaction. Marketers must monitor post purchase satisfaction, post purchase actions and post purchase product uses. Post purchase satisfaction The buyer’s satisfaction is a function of the closeness between the buyer’s expectations and the product’s perceived performance. If performance falls short of expectations, the customer is disappointed; if it meets expectations, the customer is satisfied; if it exceeds expectations, the customer is delighted. Post purchase actions satisfaction or dissatisfaction with the product will influence a consumer ‘s subsequent behavior. If the consumer is satisfied, he or she will exhibit a higher profitability of purchasing the product again. If the consumer is dissatisfied, they may abandon or return the product. They may take public action by complaining to the company, going to a lawyer. They may take private actions include : stop buying the products, warning friends, etc.

Post purchase use and disposal Marketers should also monitor how buyers use and dispose of the product. If consumers store the product in a closet, the product is probably not very satisfying. If they sell or trade the product, new product sales will be depressed. If the consumers throw the product away, the marketer needs to know how they dispose of it, especially if it can hurt the environment (such as: beverages containers and diapers).

How customers use or dispose of products? Source from: Jacob jacoby, Carol. K. berning, and Thomas F. Dietvorst, ”What about disposition? ” Rent it Get Rid of it temporaril y Produc t Give it away To be (resoled) Lend it Trade it Get Rid of it permanently To be used Use it to serve original purpose Keep it convert it to serve a new purpose Sell it Direct to consumer Throw it Through middleman Store it To intermediary