COPYRIGHT 2006 Thomson SouthWestern a part of The

COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Consumer Behavior Roger D. Blackwell Paul W. Miniard James F. Engel Requests for permission to make copies of any part of the work should be mailed to the following address: Permissions Department, Thomson Business and Economics 5109 Natorp Boulevard Mason, OH 45040 800– 423– 0563 COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

CHAPTER 1 Consumer Behavior and Consumer Research COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

What Is Consumer Behavior? Activities people undertake when obtaining, consuming, and disposing of products and services COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Consumer Influences Obtaining Organizational Influences Consuming Disposing Consumer Behavior COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Consumer Influences Organizational Influences COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Consumer Influences Culture Ethnicity Personality Family Life-stage Values Income Available Resources Attitudes Opinions Feelings Motivations Past Experiences Peer Groups Knowledge Organizational Influences Brand Product Features Advertising Word of Mouth Promotions Retail Displays Price Quality Service Store Ambiance Convenience Loyalty Programs Packaging Product Availability COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Consumer Influences Obtaining Organizational Influences Consuming Disposing Consumer Behavior COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Obtaining Consuming Disposing COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Obtaining Consuming Disposing ·How you decide ·How you use the you want to buy product ·How you get rid of remaining product ·Other products you consider buying ·How you store the product in your home ·How much you throw away after use ·Where you buy ·Who uses the product ·If you resell items yourself or through a consignment store ·How you pay for product ·How much you consume ·How you transport ·How product home compares with expectations ·How you recycle some products COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

CONSUMER INFLUENCES Culture Ethnicity Personality Family Life-stage Values Income Available Resources Attitudes Opinions Motivations Past Experiences Feelings Peer Groups Knowledge OBTAINING ·How you decide you want to buy ·Other products you consider buying ·Where you buy ·How you pay for product ·How you transport product home ORGANIZATIONAL INFLUENCES Brand Product Features Advertising Word of Mouth Promotions Retail Displays Price Quality Service Store Ambiance Convenience Loyalty Programs Packaging Product Availability CONSUMING ·How you use the product ·How you store the product in your home ·Who uses the product ·How much you consume ·How product compares with expectations Consumer Behavior DISPOSING ·How you get rid of remaining product ·How much you throw away after use ·If you resell items yourself or through a consignment store ·How you recycle some products COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

What Is Consumer Behavior? Activities people undertake when obtaining, consuming, and disposing of products and services A field of study that focuses on consumer activities COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

What Is Consumer Behavior? Activities people undertake when obtaining, consuming, and disposing of products and services A field of study that focuses on consumer activities Scope goes beyond just why and how people buy to include consumption analysis COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Consumption Analysis Why and how people use products in addition to why and how they buy COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

The Marketing Concept The process of planning and executing the conception, pricing, promotion, and distribution of ideas, goods, and services to create exchanges that satisfy individual and organizational objectives COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

The Marketing Concept The process of planning and executing the conception, pricing, promotion, and distribution of ideas, goods, and services to create exchanges that satisfy individual and organizational objectives Satisfaction with an exchange depends on satisfaction with consumption of product and the exchange of money COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Why Study Consumer Behavior? COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Why Study Consumer Behavior? Consumer Behavior Determines the Economic Health of a Nation COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Why Study Consumer Behavior? Consumer Behavior Determines the Economic Health of a Nation Consumer Behavior Determines the Success of Marketing Programs COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Why Study Consumer Behavior? Consumer Behavior Determines the Success of Marketing Programs Marketing can be used to influence brand choice and purchase, while Demarketing can influence people to stop harmful consumption “The Customer is King” Organization influenced by consumer needs and wants COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Why Study Consumer Behavior? Consumer Behavior Determines the Success of Marketing Programs Organizations that are Customercentric use a total marketing approach to focus their resources on satisfying customers Marketing Process of transforming or changing an organization to have what people will buy COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Why Study Consumer Behavior? Consumer Behavior Determines the Economic Health of a Nation Consumer Behavior Determines the Success of Marketing Programs Consumer Behavior Determines the Economic Health of Everyone COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Why Study Consumer Behavior? Consumer Behavior Determines the Economic Health of Everyone The individual’s decisions as a consumer determine their economic health by making more effective consumption decisions while avoiding deceptive practices harmful to them COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Why Study Consumer Behavior? Consumer Behavior Determines the Economic Health of Everyone Public policy leaders and social commentators study consumer behavior to alleviate overconsumption and underconsumption by educating consumers about problems and providing assistance COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Educating Consumers About Crises COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Educating Consumers About Health Understanding consumers’ issues or problems and developing methods to reach and educate consumers COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Educating Consumers About Health Understanding consumers’ issues or problems and developing methods to reach and educate consumers COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Why Study Consumer Behavior? Consumer Behavior Determines the Economic Health of a Nation Consumer Behavior Determines the Success of Marketing Programs Consumer Behavior Determines the Economic Health of Everyone Consumer Behavior Helps Formulate Public Policy COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Helps Formulate Public Policy Understanding consumers’ needs to formulate public policy and predicting behavioral changes that follow Government Protection and Education Inte rat rest es Soci al Welf are ng Warni labels ics m o n o Ec ily Fam ing n Plan nt e m n r Gove tions la u g e R Protection from Competitive Markets COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Why Study Consumer Behavior? Consumer Behavior Affects Personal Policy COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Why Study Consumer Behavior? Consumer Behavior Affects Personal Policy Personal policy includes how you behave towards others and in buying situations, your values and beliefs, and how you live your life A person’s economic quality of life is determined by personal policy COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Evolution of Consumer Behavior COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Evolution of Consumer Behavior Supply Chain: all the organizations involved in taking a product from inception to final consumption - Manufacturers - Wholesalers - Retailers - Facilitating Organizations COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Evolution of Consumer Behavior Supply Chain: all the organizations involved in taking a product from inception to final consumption - Manufacturers - Wholesalers - Retailers - Facilitating Organizations Consumers’ Increased Influence on Business COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Evolution of Consumer Behavior Wholesaler Manufacturing Orientation U. S. Retailer Consumer Selling Marketing Consumer Orientation 1750 -1850 -WWII 1970 -2000+ Europe 1750 -1850 1760 -WWII 1970 -2000+ COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Evolution of Consumer Behavior Consumers’ Increasing Influence Wholesaler Manufacturing Orientation U. S. Retailer Consumer Selling Marketing Consumer Orientation 1750 -1850 -WWII 1970 -2000+ Europe 1750 -1850 1760 -WWII 1970 -2000+ COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Evolution of Consumer Behavior Manufacturing Orientation COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Evolution of Consumer Behavior Manufacturing Orientation Selling Orientation COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Evolution of Consumer Behavior Manufacturing Orientation Selling Orientation Marketing Orientation COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Evolution of Consumer Behavior Manufacturing Orientation Selling Orientation Marketing Orientation - Motivation research - Positivism - Postmodernism COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Evolution of Consumer Behavior Manufacturing Orientation Selling Orientation Marketing Orientation Consumer Orientation COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Consumer Orientation Beyond a marketing focus How all organizations in a demand chain adapt to changing consumer lifestyles and behaviors bringing product design, logistics, manufacturing, and retailing together Role of consumers in shaping many aspects of life—society, government, social programs, health cares, and other areas COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Consumer Research: Methods of Studying Consumer Behavior COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Consumer Research Methods Observation COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Consumer Research Methods Observation Observing consumer behaviors in different situations such as natural or artificial settings COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Consumer Research Methods Observation In-home observation: examining how and when consumers use and consume products in their households Shadowing: following and observing consumers in the shopping and consumption processes. Researchers may ask questions about reasons for behaviors Physiological methods: Techniques borrowed from medicine, psychology and other sciences including cameras to measure eye movement, galvanic skin response, and MRI COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Consumer Research Methods Interviews and Surveys COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Consumer Research Methods Interviews and Surveys: efficient method for gathering information from a large sample of consumers by asking questions and recording responses (telephone and Internet surveys, mall intercepts, and mail questionnaires) COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Consumer Research Methods Interviews and Surveys: efficient method for gathering information from a large sample of consumers by asking questions and recording responses (telephone and Internet surveys, mall intercepts, and mail questionnaires) Focus Groups: a group discussion led by a moderator skilled in persuading consumers to thoroughly discuss a topic of interest COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Consumer Research Methods Interviews and Surveys: efficient method for gathering information from a large sample of consumers by asking questions and recording responses (telephone and Internet surveys, mall intercepts, and mail questionnaires) Focus Groups: a group discussion led by a moderator skilled in persuading consumers to thoroughly discuss a topic of interest Longitudinal Studies: repeated measures of activities over time to determine changes in opinions, buying, and consumption behaviors COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Consumer Research Methods Experimentation Measuring cause-and-effect relation-ships by manipulating independent variables to determine the effects of changes on dependent variables - Laboratory experiment - Field experiment COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Consumer Research Methods Experimentation COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Consumer Research Methods Experimentation Attempts to understand cause-and-effect relationships by carefully manipulating independent variables to determine how these changes affect dependent variables - Laboratory experiment - Field experiment Independent variables might include number of advertisements and package design Dependent variables might include purchase intent or behavior COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Consumer Research Methods Consumption Research COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Consumer Research Methods Consumption Research Builds on the three primary research methods to examine how people use products and services rather than how they buy them COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Understanding How Consumers Use Products COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Consumer Research Methods Consumption Research Builds on the three primary research methods to examine how people use products and services rather than how they buy them May use ethnographic tools to understand how values and culture influence usage of products and other behaviors COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Consumer Research Methods Consumption Research Builds on the three primary research methods to examine how people use products and services rather than how they buy them May use ethnographic tools to understand how values and culture influence usage of products and other behaviors May identify new uses for existing products or new product to satisfy unmet or changing consumer needs COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

The Underlying Principles of Consumer Behavior The Consumer Is Sovereign COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

The Underlying Principles of Consumer Behavior The Consumer Is Sovereign The Consumer Is Global COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

The Underlying Principles of Consumer Behavior The Consumer Is Sovereign The Consumer Is Global Consumers Are Different; Consumers Are Alike COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Consumers appear different but respond in similar ways to brands COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Consumers appear different but respond in similar ways to brands COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

The Underlying Principles of Consumer Behavior The Consumer Is Sovereign The Consumer Is Global Consumers Are Different; Consumers Are Alike The Consumer Has Rights COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Consumer Bill of Rights COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.

Challenges for the Future Gathering and interpreting information that organizations need to meet changing needs of consumers Developing effective consumer research methods to capture changes in trends and lifestyles Understanding consumer behavior from a broader perspective as an important part of life COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.