Consumer Decision Making
Chapter 5
Prepared by
Deborah Baker
Texas Christian University
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
1
Learning Objectives
1. Explain why marketing managers should
understand consumer behavior.
2. Analyze the components of the consumer
decision-making process.
3. Explain the consumer’s postpurchase
evaluation process.
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
2
Learning Objectives (continued)
4. Identify the types of consumer buying
decisions and discuss the significance of
consumer involvement.
5. Identify and understand the cultural factors
that affect consumer buying decisions.
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
3
Learning Objectives (continued)
6. Identify and understand the social factors
that affect consumer buying decisions.
7. Identify and understand the individual
factors that affect consumer buying
decisions.
8. Identify and understand the psychological
factors that affect consumer buying
decisions.
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
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1
Learning Objective
On Line
http://www.newyork.com
http://www.newyork.org
Explain why
marketing managers
should understand
consumer behavior.
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
5
1
Consumer Behavior
Processes a consumer uses
to make purchase decisions,
as well as to use and
dispose of purchased goods
or services; also includes
factors that influence
purchase decisions and
the product use.
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
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2
Learning Objective
Analyze the
components of the
consumer decisionmaking process.
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
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2
Consumer Decision-Making Process
A five-step process used
by consumers when buying
goods or services.
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
8
Consumer
Decision-Making Process
2
Need Recognition
Information Search
Cultural, Social,
Individual and
Psychological
Factors
affect
all steps
Evaluation
of Alternatives
Purchase
Postpurchase
Behavior
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
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Need Recognition
2
Result of an imbalance
between actual and
desired states.
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
10
2
Need Recognition
Marketing helps
consumers
recognize an
imbalance between
present status and
preferred state
Internal Stimuli
and
External Stimuli
Preferred
State
Present
Status
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
11
Stimulus
2
Any unit of input affecting
one or more of the five
senses:
sight
smell
taste
touch
hearing
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
12
Want
2
Recognition of an
unfulfilled need and
a product
(or attribute or feature)
that will satisfy it.
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
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2
Recognition of Unfulfilled Wants
 When a current product isn’t
performing properly
 When the consumer is running
out of a product
 When another product seems
superior to the one currently used
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
14
Information Searches
2
Internal
Process of recalling past
information stored
in the memory.
External
Process of seeking
information in the
outside environment.
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
15
2
Information Search
Internal Information Search
 Recall information in
memory
External Information search
 Seek information in outside
environment
 Non-marketing controlled
 Marketing controlled
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
16
2
External Information Searches
Need Less
Information
Less Risk
More knowledge
More product
experience
Low level of interest
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
Need More
Information
More Risk
Less knowledge
Less product
experience
High level of interest
17
Evoked Set
2
Group of brands,
resulting from an
information search,
from which a buyer
can choose.
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
18
2
Evaluation of Alternatives
Evoked Set
Analyze product attributes
Use cutoff criteria
Rank attributes by
importance
Purchase!
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
19
Purchase
2
To buy
or not to buy...
Determines which attributes
are most important
in influencing a
consumer’s choice
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
20
3
Learning Objective
Explain the
consumer’s
postpurchase
evaluation process.
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
21
Cognitive Dissonance
3
Inner tension that a
consumer experiences
after recognizing an
inconsistency between
behavior and values
or opinions.
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
22
3
Postpurchase Behavior
Cognitive Dissonance
?
Can minimize through:
Effective Communication
Did I make a good decision?
Follow-up
Guarantees
Did I buy the right product?
Warranties
Did I get a good value?
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
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4
Learning Objective
Identify the types of
consumer buying
decisions and discuss
the significance
of consumer
involvement.
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
24
Types of Consumer
Buying Decisions
4
Routine
Response
Behavior
Limited
Decision
Making
Less
Involvement
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
Extensive
Decision
Making
More
Involvement
25
4
Five Factors influencing Decisions
1.
Level of consumer involvement
2.
Length of time to make decision
3.
Cost of good or service
4.
Degree of information search
5.
Number of alternatives considered
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
26
Continuum of
Consumer Buying Decisions
4
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
27
4
Routine Response Behavior
 Little involvement in selection
process
 Frequently purchased low cost
goods
 May stick with one brand
 Buy first/evaluate later
 Quick decision
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
28
4
Limited Decision Making
 Low levels of involvement
 Low to moderate cost goods
 Evaluation of a few alternative brands
 Short to moderate time to decide
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
29
4
Extensive Decision Making
 High levels of involvement
 High cost goods
 Evaluation of many brands
 Long time to decide
 May experience cognitive
dissonance
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
30
4
Level of Involvement
On Line
http://www.gardenburger.com
Previous
Experience
Factors
Determining
Level of
Involvement
Interest
Perceived Risk of
Negative
Consequences
Situation
Social Visibility
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
31
Marketing Implications
of Involvement
4
High-involvement
purchases require:
Low-involvement
purchases require:
Extensive and
informative
promotion to
target market
In-store promotion,
eye-catching
package design, and
good displays
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
32
Factors Influencing
Buying Decisions
4
Cultural
Factors
Individual
Factors
Social
Factors
Psychological
Factors
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
CONSUMER
DECISIONMAKING
PROCESS
BUY /
DON’T BUY
33
5
Learning Objective
Identify and
understand the
cultural factors that
affect consumer
buying decisions.
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
34
Culture
5
Set of values norms,
attitudes, and other
meaningful symbols that
shape human behavior and
the artifacts, or products, of
that behavior as they are
transmitted from one
generation to the next.
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
35
Cultural Influences on
Buying Decisions
5
Values
Language
Myths
Customs
Components of
American
Culture
Rituals
Laws
Material Artifacts
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
36
5
Culture is...
On Line
http://www.dead.net
http://www.chuckecheese.com
Pervasive
Functional
Learned
Dynamic
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
37
Value
5
Enduring belief that a
specific mode of conduct
is personally or socially
preferable to another
mode of conduct.
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
38
5
Core American Values
Success
Materialism
Freedom
Progress
Core
American
Values
Youth
Capitalism
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
39
5
Global Language Blunders
 Chevrolet’s “Nova” translated to “No Go”
 Coors “Turn it Loose” became
“Suffer from Diarrhea”
 Toyota’s MR2 sounded like a
swearword in French
 Coca-Cola in Chinese means
“bite the wax tadpole”
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
40
Subculture
5
A homogeneous group
of people who share
elements of the overall
culture as well as
unique elements of
their own group.
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
41
Social Class
5
A group of people in a
society who are considered
nearly equal in status or
community esteem, who
regularly socialize among
themselves both formally
and informally, and who
share behavioral norms.
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
42
5
Social Class Measurements
Occupation
Income
Social Class
Measurements
Education
Wealth
Other Variables
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
43
The Impact of Social Class
on Marketing
5
 Indicates which medium to use for
advertising
 Helps determine the best distribution
for products
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
44
6
Learning Objective
Identify and
understand the
social factors that
affect consumer
buying decisions.
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
45
6
Social Influences
Social Influences on
Buying Decisions
Reference
Groups
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
Opinion
Leaders
Family
Members
46
Reference Group
6
A group in society that
influences an individual’s
purchasing behavior.
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
47
6
Reference Groups
Primary
Direct
Secondary
Reference
Groups
Aspirational
Indirect
Non-aspirational
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
48
6
Implications of Reference Groups
1. They serve as information sources
and influence perceptions
2. They affect an individual’s
aspiration levels
3. Their norms either constrain or
stimulate consumer behavior
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
49
Opinion Leaders
6
An individual who
influences the opinion
of others.
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
50
6
Opinion Leaders
Peer Groups
Group Referrals
Movie Stars
Sports Figures
Celebrities
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
51
6
Family
On Line
http://www.gamegirlz.com
http://www.gamespot.com
Purchase Roles
in the Family
 Initiators
 Influencers
 Decision Makers
 Purchasers
Children
Influence
Purchase
Decisions
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
 Consumers
52
6
Relationships among Purchasers
and Consumers in the Family
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
53
7
Learning Objective
Identify and
understand the
individual factors
that affect consumer
buying decisions.
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
54
7
Individual Influences
On Line
http://www.ballyfitness.com
Individual
Influences
Gender
Age
Family Life
Cycle
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
Personality
Self-Concept
Lifestyle
55
Family Life Cycle
7
An orderly series of stages
through which consumers’
attitudes and behavioral
tendencies evolve through
maturity, experience, and
changing income and status.
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
56
Psychographics
7
The analytical technique
used to examine consumer
lifestyles and to categorize
consumers.
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
57
8
Learning Objective
Identify and
understand the
psychological factors
that affect consumer
buying decisions.
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
58
8
Psychological Influences
Perception
Motivation
Learning
Psychological
Influences on
Buying Decisions
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
Beliefs & Attitudes
59
Perception
8
Process by which people
select, organize, and
interpret stimuli into
a meaningful and
coherent picture.
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
60
8
Perception
Selective
Exposure
Selective
Distortion
Selective
Retention
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
61
8
Perception
Selective
Exposure
Consumer notices certain stimuli
and ignores others
Selective
Distortion
Consumer changes or distorts
information that conflicts
with feelings or beliefs
Selective
Retention
Consumer remembers only
that information that
supports personal beliefs
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
62
8
A Consumer’s Selective Exposure
Exposure to over 250
advertisement messages per day
Notices only
11 to 20 ads
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
63
Marketing Implications
of Perception
8
 Important attributes
 Higher price
 Brand names
 Quality and reliability
 Threshold level of perception
 Product or repositioning changes
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
64
Maslow’s Hierarchy of Needs
8
A method of classifying
human needs and
motivations into five
categories in ascending
order of importance.
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
65
8
Motivation
Maslow’s
Hierarchy of
Needs
SelfActualization
Esteem
Social
Safety
Physiological
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
66
Learning
8
A process that creates
changes in behavior,
immediate or expected,
through experience
and practice.
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
67
8
Types of Learning
Types of
Learning
Description
Experiential
An experience changes behavior
Conceptual
Not learned through direct
experience
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
68
Stimulus Generalization
8
A form of learning that
occurs when one response
is extended to a second
stimulus similar to the first.
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
69
Beliefs and Attitudes
8
On Line
http://saveharry.com
http://www.cspinet.org
Belief
An organized pattern of
knowledge that an individual
holds as true about his
or her world.
Attitude
A learned tendency to
respond consistently
toward a given object.
Chapter 5 Marketing 7e, Lamb Hair McDaniel
©2004 South-Western/Thomson Learning
70