MKT10007 Week 2

What is Consumer Behaviour?

Factors affecting consumer behaviours
Consumer Decision Making Process (CDMP)
Consumer
Behaviour
What is Consumer Behaviour?
“The processes involved when individuals or groups select, purchase, use, or dispose of products,
services, ideas, or experiences to satisfy needs and desires” [Solomon, 2013]

The study of consumer behaviour includes:​

• How consumers think​
• What they buy​
• Why they buy ‘it’​
• How often they buy ‘it’​
• How often they use ‘it’​
• How they dispose of ‘it’​
Who are the customers?
• The personal consumer buys for personal, individual use​ (a.k.a final consumer market)

• The social consumer, buys on behalf of others, or makes decisions jointly​

• The organizational consumer, are units within an organization that makes purchases on
behalf of the organization​
The “final consumer” market:
• “…individuals and households who buy or acquire goods and services for personal
consumption.” (Kotler, et al. 2009: 162)
• Most marketers undertake consumer research to try to learn more about: what consumers
buy, who buys, how they buy, when they buy, where they buy and, most importantly, why
they buy.
 The social consumer and organizational buying roles

person who person who first suggests

consumes/uses or thinks of idea to buy
product, e.g. all Initiator product, e.g. youngest child
User

who makes Key whose view carries weight in

Decision buying decision, e.g.
actual Influencer teenager interested in
purchase, Buyer Roles technology
e.g. father

ultimately makes Determines which

buying decision, e.g. Decider Gatekeeper choices/offerings are
mother considered in the group
Consider this scenario:

An Indonesian graduate wants to continue his education

abroad.
His girlfriend has secured a spot at a prestigious university in
Australia, so he wants to go there. But, his mom doesn't want
him to be so far away so she orders the son to study in
Singapore instead.
His father will pay for it, and he takes the student to the
education agency, who advised the family about what options
are available in Singapore.
The need to relate to the consumer

The concept of market segmentation/segments go hand-in-hand with the study of consumer

behaviour
• Market Segmentation: the process of dividing a market into subsets of consumers with
common needs and characteristics
• Consumer behaviour acknowledges the uniqueness of consumers, but try to group consumers
who are ‘similar enough’ to make serving them effective, worthwhile, and profitable.
• A pillar of consumer behaviour study is that: to make a message effective, it has to be
relevant.
• Relevance revolves around “how can this satisfy my need in my situation?”
• Understanding consumers’ complex ‘black box’ of needs, characteristics and situations are
essential to gain favourable responses
Example:
Three car insurance ads from the same company, designed to be relevant to different groups of
people

Three car insurance brands targeting different consumer characteristics, owned by the same
company.

https://www.suncorpgroup.com.au/about/brands
The ‘noisy’ marketplace of options
How can your message be heard among these?
Consumer behaviour overview summary

We have discussed:
• What is consumer behaviour
• What are the different types of consumers
• Introduction to consumer segments
Factors influencing
Consumer Behaviour
The following are snippets and overview of a very
comprehensive topic. Please dive deeper by going to this link:
https://ebookcentral.proquest.com/lib/swin/reader.action?docID=5187878&ppg=160
Factors influencing Consumer Behaviour
Cultural factors

Culture is the set of basic values, perceptions, behaviours learned by a member of society from
family and other important institutions.
• These are the ‘unspoken rules of society’ i.e Should the elderly be respected? How is success
defined?
Subcultures are groups of people within a culture with shared value systems based on common
life experiences and situations
• These are the labels of society i.e Japanese culture, European culture
Social classes are society’s relatively permanent and ordered divisions whose members share
similar values, interests, and behaviours
• These are measured as a combination of occupation, income, education, wealth, and other
variables
Example of Culture dimensions
Social Factors

Groups/ Reference Groups

Membership Aspirational
Groups Groups
• Groups with • Groups an
direct influence individual
and to which a wishes to
person belongs belong to
Social Factors

Dissociative Groups: Groups of people to whom we do not want to belong

Example:

Burberry rescued their image after being associated with undesirable ‘chavs’ (U.K equivalent of
bogans) by employing Emma Watson, who played Hermione in the Harry Potter movies
https://www.thisismoney.co.uk/money/news/article-1698684/How-Emma-Watson-rescued-
Burberry.html
Personal Factors
Typical life-cycle stages of people
Personality

•Personality refers to the unique characteristics that lead to

relatively consistent and lasting responses to our environment
• Often understood in terms of traits – e.g. orderly, adaptable or
dominant
• Each person’s distinct personality influences his or her buying
behaviour.
• People buy brands reflecting their personality traits
• E.g. someone with trait ‘need for achievement’ may buy a
different car compared to a person who has a high need for
acceptance.
• Self-concept is how consumers perceive themselves
• The idea is that brands also have personalities, and consumers
are likely to choose brands with personalities that match their
own
Motivation

A motive (or drive) is a need that is sufficiently pressing to direct the person to seek satisfaction
of the need.
Motivation is the energizing force that stimulates behavior to satisfy needs.
• Personality is a big driver for motivation
• Marketing efforts could also significantly influence motivation (see e.g: need recognition
trigger in CDMP)
Perception

Perception is the process by which people select, organize, and interpret information to form a
meaningful picture of the world
Humans, by their physiological design, are inherently biased.
Marketers often leverage on these biases to appeal to consumers’ attitudes and preferences

• Selective attention is the tendency for people to screen out most of the
information to which they are exposed.
• Selective retention consumers do not remember all the information they see,
read or hear, even minutes after exposure to it.
• Selective distortion is the tendency for people to interpret information in a way
that will support what they already believe.
Beliefs and Attitudes
Students often have to ‘unlearn’ the meaning of beliefs & attitude in daily language vs consumer behaviour
language.
In CB, A belief is a descriptive thought that a person has about something based on:
• Facts,
• Opinion, and/or
• Faith
Beliefs are based on personal experience, advertising and discussion with other people.
Beliefs are, put simply, the person’s ‘subjective knowledge’ about the world around them. Example:
- Belief that the sun will rise in the east and sets in the west
- Belief that not brushing will cause bad breath
- Belief that some groups are more superior than others
An attitude describes a person’s relatively consistent evaluations, feelings, and tendencies toward an object
oridea. Attitudes are shaped by values, feelings, beliefs about cause and effect, all of which are learned.
Attitudes always have valence, i.e positive or negative weighting. Example:
• Positive attitude towards exercise
• Negative attitude towards TikTok
• Positive attitude towards smoking
Learning

Learning is the change in an individual’s behavior arising from experience of positive or negative
consequences of an action
• When an action brings positive results, it is more likely to be repeated
• When an action brings negative results, it is more likely to be abandoned
Marketers often try to leverage positive feelings to make consumers repeat a purchase
behaviour.
• Loyalty cards
• Discounts and free trials
More recently, marketing ethicists have warned that gambling principles are more heavily
utilized in consumer products, example:
• Video game designers emulate the design of gambling slot machines in “loot boxes”, where
gamers are encouraged to spend to obtain the chance of feeling like a lucky winner of rare
gaming artifacts (i.e weapons, extra lives, etc).
Consumer behaviour influencers summary

We have discussed four main pillars of things that could influence consumer behaviour:
• Cultural
• Social
• Personal
• Psychological

Next, we will discuss how these factors may influence the consumers’ decision making process.
Consumer Decision
Making Process
The step-by-step process used by consumers when
buying goods or services
This concept is essential to your assignment. Please
dive deeper by reading this link:
https:/ / ebookcentral.proquest.com/ lib/ swin/ reader.action?docID=5187878&ppg=177
Consumer Decision-Making Process

The model tries to capture the journey of consumers from awareness to post-purchase
Stage 1- Need Recognition

Occurs when a consumer is faced with an imbalance between actual and desired states
• Needs, put simply, are states of deprivation or an imbalance between actual and desired
state-of-being
• Needs are generally universal, i.e need for nutrition, love, belonging, sleep, etc
• Need can be triggered by internal or external stimuli
• A want exists when the need manifests into desire for a product to resolve the imbalance,
filtered through the person’s characteristics
• The same need in different people might manifest into desires of different products
Need recognition triggers

Consumer behaviourists try to:

1. Understand the circumstances that trigger the need
2. Communicate this trigger to the consumer by
getting the consumer to recognise this imbalance
3. Motivating consumers to act on/purchase the
product to satisfy the need
Example: Why do energy* companies advertise heavily
in May-June in Australia? (*electricity and gas)
Reaching the consumers at their most “painful point”

Effective communication typically targets consumers at the right moments when they are most
susceptible

Examples:

Life coaching Ridesharing adverts in busy

advertisements in front of bus stops
student dorms
Stage 2- Information Search

Information search is the stage of the buyer decision process in which the consumer is motivated
to search for more information.

Sources of information (can be internal or external):

• Experiential sources (personal experience)
• Personal sources(e.g. family/friends)
• Commercial sources (marketing-driven-advertising, company web-site, sales person)
• Public sources(e.g. consumer report, magazine, blog, internet)
Generally, the higher the risk, the greater the search >> Goal is to reduce uncertainty
Stage 3- Evaluation of Alternatives

Brands generally aim to be among the ‘evoked

set’ of their target segment’s minds, but they
aim to be on the ‘unawareness set’ of
consumers they are not interested to serve
Example: Apia, a car insurance for the over 50s would
rather not take quote requests from uni students, as it
wastes their time.
Stage 4- Purchase Decision

Purchase decision is the buyer’s decision about which brand to purchase, from whom to
purchase and when to purchase.

The purchase intention may not be the purchase decision. Factors that may distort the intention
to purchase due to:
• Unexpected situational factors (e.g. supermarket aisle placement and promotions)
• Attitudes of others & Social desirability bias
Stage 5 Post- purchase behaviour:

The stage where consumers take further action after purchase, based on their satisfaction or
dissatisfaction

The step where consumer makes decision to repurchase, or switch.

Potential for “post-purchase dissonance”: an inner tension over the perceived appropriateness of
a purchase after his or her decision has been made
“Did I get the right thing?”
Dissonance =/= regret!
Role of involvement in the CDMP

Involvement levels refers to the personal, financial, and social significance of the decision being
made.
Low and high consumer involvement has important implications for marketing strategy
Role of involvement in the CDMP
CDMP summary

The CDMP consists of five steps

The consumers’ involvement with the product being considered may influence the speed and
complexity of the CDM process

Marketers typically use their knowledge of the four CB influencers (social, cultural, personal,
psychological) to influence one or more steps in the CDMP journey.