Chapter 1 Understanding Consumer Behavior Copyright Cengage Learning

Chapter 1 Understanding Consumer Behavior Copyright © Cengage Learning. All rights reserved. 1|

Learning Objectives 1. Define consumer behavior and explain its elements. 2. Identify the four domains of consumer behavior. 3. Discuss the benefits of studying consumer behavior. 4. Learn how consumer behavior is used in organizations to make marketing decisions. Copyright © Cengage Learning. All rights reserved. 1|2

Consumer Behavior Reflects totality of consumer’s decisions with respect to the acquisition, consumption, and disposition of goods, services, time, and ideas by (human) decision-making units (over time). Copyright © Cengage Learning. All rights reserved. 1|3

Consumer Behavior Involves Attitudes Towards • • • Products Services Activities People Ideas Copyright © Cengage Learning. All rights reserved. 1|4

What Is Consumer Behavior? (Exhibit 1. 1) Copyright © Cengage Learning. All rights reserved. 1|5

Consumer Behavior & Consumption • Acquisition • Usage • Disposition Copyright © Cengage Learning. All rights reserved. 1|6

Consumer Behavior • • Dynamic process Can involve many people Involves many decisions Involves consumers’ feelings and coping Copyright © Cengage Learning. All rights reserved. 1|7

Consumer Decisions • • • Whether? What? Why Not? How? Ways? Copyright © Cengage Learning. All rights reserved. • • • When? Where? How much? How often? How long? 1|8

Model of Consumer Behavior Copyright © Cengage Learning. All rights reserved. 1|9

What Affects Consumer Behavior? • • Psychological Core Process of Making Decisions Consumer’s Culture Consumer Behavior Outcomes Copyright © Cengage Learning. All rights reserved. 1 | 10

Psychological Core • Motivation, Ability, and Opportunity • Exposure, Attention, and Perception • Categorizing and Comprehending Information • Forming and Changing Attitudes • Forming and Retrieving Memories Copyright © Cengage Learning. All rights reserved. 1 | 11

Decision-making Process • Problem Recognition & Search for Information • Judgments & Decisions • Post-Decision Evaluations Copyright © Cengage Learning. All rights reserved. 1 | 12

Consumer’s Culture: External Processes/Influences • • Consumer Diversity Social Class & Household Values, Personality, & Lifestyles Reference Groups and Other Social Influences Copyright © Cengage Learning. All rights reserved. 1 | 13

Consumer Behavior Outcomes • Symbolize who we are—external signs used to express our identity • Diffuse through a market—influence others’ decision making • Ethics and social responsibility Copyright © Cengage Learning. All rights reserved. 1 | 14

Who Benefits from the Study of Consumer Behavior? • • • Marketing Managers Ethicists/Advocacy Groups Public Policy Makers/Regulators Academics Consumers Copyright © Cengage Learning. All rights reserved. 1 | 15

Marketing Implications of Consumer Behavior • Developing/implementing customerorientation – Segmenting the market? – Profitability of each segment? – Characteristics of each segment? – Customer satisfaction of each segment? • Selecting the target market Copyright © Cengage Learning. All rights reserved. 1 | 16

Marketing Implications of Consumer Behavior • Product positioning decisions – Positioning of competition? – How should our offerings be positioned? – Should we reposition offerings? Copyright © Cengage Learning. All rights reserved. 1 | 17

Marketing Implications of Consumer Behavior • Products/services development decisions – Consumers’ ideas for new products? – Additional or different attributes? – Brand naming? – Packaging and logo design? Copyright © Cengage Learning. All rights reserved. 1 | 18

Marketing Implications of Consumer Behavior • IMC decisions – Advertising objectives? – Words and visuals of ads? – Where should ads be placed? – When should ads be placed? – Have ads been effective? Copyright © Cengage Learning. All rights reserved. 1 | 19

Marketing Implications of Consumer Behavior • IMC decisions (cont) – Sales promotion objectives? – When should sales promotions occur? – Have sales promotions been effective? – How large a sales force? – How can salespeople best serve customers? Copyright © Cengage Learning. All rights reserved. 1 | 20

Marketing Implications of Consumer Behavior • Pricing decisions – What should the price be? – How sensitive are consumers to price and price changes? – When should pricing tactics be used? • Distribution decisions – Where does target market shop? – How should stores be designed? Copyright © Cengage Learning. All rights reserved. 1 | 21