Priciples of Marketing

by Philip Kotler and Gary Armstrong

Chapter 5
Managing Marketing Information to
Gain Customer Insights

PEARSON
Objective Outline

Model of Consumer Behavior

Define the consumer market and construct a simple
1
model of consumer buyer behavior.

Characteristics Affecting Consumer Behavior

Name the four major factors that influence consumer
2
buyer behavior.
Objective Outline

Types of Buying Decision Behavior

3 The Buyer Decision Process
List and define the major types of buying decision
behavior and the stages in the buyer decision process.

The buyer decision Process for New Products

4 Describe the adoption and diffusion process for new
products.
Model of Consumer Behavior

Consumer Buyer Behavior

Consumer buyer behavior refers to the buying
behavior of final consumers individuals and households
that buy goods and services for personal consumption. All of
these final consumers combine to make up the consumer
market.
Model of Consumer Behavior

We can measure the whats, wheres, and whens of consumer buying

behavior. But its very difficult to see inside the consumers head
and figure out the whys of buying behavior (thats why we call
black box). Marketers spend a lot of time and dollars trying to
figure out what makes customers tick.
Characteristics Affecting Consumer Behavi
or
Cultural Factors

Culture
Factors

Social
Culture Subculture
Class
Culture

Culture
Every is the
group
Marketers orset
are of basic
society
always hasvalues, perceptions,
a culture,
trying to spot and wants,
cultural
cultural shifts so
and behaviors
influences
as to discover learned
on buying by a member
behavior
new products of society
maymight
that vary from
greatly
be wanted.
family
from andcountry
both other important
to countyinstitutions.
and country to country.
Subculture Many marketers now embrace cross-cultural
They tend to be deeply family oriented and make shipping a family
marketing the practice of including ethnic
affair children have a bigand
themes saycross-cultural
in what brands they buy. within
perspectives
Each
Older, first-generation Hispanic
Asian Americans
consumers aretend
the second-
to be very brand
culture contains
Although their smaller
mainstream
morefastest-growing
price conscious subcultures,
marketing.
than other or gro
loyal andsegments,
to favor
brands and sellers whosubsegment
show afterinterest in
special
ups of people Cross-cultural
with shared
blacks are also marketing
value appeals
systems
strongly motivated to consumer
based on
Hispanic
them. by qualitysimilarities Americans.
and across subcultures rather than
selection.
common
Younger life experiences
Hispanics, Asian
however,
differences.
andshown
consumers
have situations.
shop frequently
increasing price and
Brands are important.
sensitivity areand
the amost brand conscious oftoall the
Inin recent
years
Many willingness
marketers
recent years,ethnic
manygroups. are to
finding
companies have switch
that insightsstore
brands. developedgleaned
special from ethnic
products, consumers
appeals, and can influence
Within the Hispanictheir They there
market, can beexist
fiercely
many brand loyal.
distinct subsegments
broader markets.
marketing programs for them.
based on nationality, age, income, and other factors.

Hispanic African Asian Cross

American American American Cultural
Consumers Consumers Consumers Marketing
Social Class
Social classes are societys relatively permanent
and ordered divisions whose members share simil
ar values, interests, and behaviors.
Social Factors

Social
Factors
Groups and Social Networks
A group is two or more people who interact to accomplis
h individual or mutual goals.
Reference groups serve as direct or indirect points of com
parison or reference in forming a persons attitudes or beh
avior.
Reference groups expose a person to new behaviors and li
festyles, influence the persons attitudes and self-concept,
and create pressures to conform that may affect the perso
ns product and brand choices.
Groups and Social Networks

Word-of-Mouth Influence and Buzz Marketing.

Opinion Leader
Word-of-Mouth
A person withinBuzz
Influence

Marketing
a reference group who, because of
The impact of the personal words and
Involves enlisting
special skills, or even personality,
knowledge, creating opinion leaders
or other
recommendations of trusted friends, associates,
to serve as brand
characteristics, ambassadors
exerts who spread
social influence the
on others.
and other consumers on buying behavior.
word about a companys products.
Some experts call this group the influentials or
Most word-of-mouth influence happens naturally:
Many
leadingcompanies
adopters. are now turning everyday
Consumers start chatting about a brand they use or
customers
Marketers into
try tobrand evangelists.
identify opinion leaders for their
feel strongly about one way or the other.
products and direct marketing efforts toward them.
Groups and Social Networks
Online Social Networks.
They are online communities where people socialize or e
xchange information and opinions.
Social networking media range from blogs and message
boards to social networking Web sites and virtual worlds
.
This new form of consumer-to-consumer and business-t
o-consumer dialog has big implications for marketers.
Family
The family is the most important consumer buyin
g organization in society, and it has been research
ed extensively.
Husband-wife involvement varies widely by prod
uct category and by stage in the buying process.
Buying roles change with evolving consumer life
styles.
Roles and Status
A role consists of the activities people are expect
ed to perform according to the people around the
m.
Each role carries a status reflecting the general es
teem given to it by society.
People usually choose products appropriate to the
ir roles and status.
Personal Factors
Age and Life-Cycle Stage
Buying is also shaped by the stage of the family life cycle
the stages through which families might pass as they m
ature over time.
Marketers often define their target markets in terms of lif
e-cycle stage and develop appropriate products and mark
eting plans for each stage.
Occupation
A persons occupation affects the goods and services bou
ght.
Marketers try to identify the occupational groups that hav
e an above-average interest in their products and services.
A company can even specialize in making products neede
d by given occupational group.
Economic Situation
A persons economic situation will affect his or her store
and product choices.
Marketers watch trends in personal income, savings, and i
nterest rates.
In the more frugal times following the Great Recession,
most companies have taken steps to redesign, reposition,
and reprice their products and services.
Lifestyle
Lifestyle is a persons pattern of living as expressed in his
or her activities, interests, and opinions.
It involves measuring consumers major AIO dimensions
activities, interests, and opinions.
It can help marketers understand changing consumer valu
es and how they affect buyer behavior.
Personality and Self-Concept
Sincerity (down-to-earth, honest, wholesome
Personality refers to the unique
, and psychological characteris
cheerful)
tics that distinguish a person or group.
Personality is usually Excitement
described in(daring,
terms ofspirited,
traits such as
imaginative,
self-confidence, dominance, sociability, autonomy, defens
and up-to-date)
iveness, adaptability, and aggressiveness.
One researcher
identified
Brand five is the
personality Competence (reliable,
specific mix of humanintelligent, and
traits that
brand
may bepersonality
attributed to a successful)
particular brand.
traits:
Sophistication (upper class and charming)

Ruggedness (outdoorsy and tough)

Psychological Factors
Motivation
A motive (drive) is a need that is sufficiently pressing to
direct the person to seek satisfaction.
Motivation researchers use a variety of probing technique
s to uncover underlying emotions and attitudes toward br
ands and buying situations.
But many marketers use such touchy-feely approaches, n
ow sometimes called interpretive consumer research, to d
ig deeper into consumer psyches and develop better mark
eting strategies.
Motivation
Perception
Selective
All of us Attention
by the flow of information through our five sens
es:
The tendency
sight, for people
hearing, smell,totouch,
screenand taste.
out most of the information to
Perception is the process by which
Selective people select, organiz
Retention
which they are exposed
e,Means
and interpret information
Consumers
that marketers mustare
tolikely
work
formtoaremember
meaningful picture
ofespecially
the world.hardgood points
to attract themade about a brand
People can form
consumers they favor and
different
attention forget foodofpoints
perceptions the same stimulu
s because of threemade about competing
perceptual brands.
processes: selective attentio
Selective Distortion
n, selective distortion, and selective
retention.
Describes the tendency of people to
interpret information in a way that
will support what they already
believe.
Learning
Learning
Describes changes in an individuals behavior arising fro
m experience.
Occurs through the interplay of drives, stimuli, cues, res
ponses, and reinforcement.
Drive
A strong internal stimulus that call for action
A drive becomes a motive when it is directed toward a p
articular stimulus object.
Beliefs and Attitudes

AA descriptive
descriptive thought
thought that
that aa person
person has
has about
about
Attitudes are difficult to change.
something
something
Belief

BeliefA persons attitudes fit into a pattern; changing one
Based
Based on
on real
real knowledge,
knowledge, opinion,
opinion, or
or faith
faith
attitude may require difficult adjustments in many
and may or may not carry an emotional charge
others. and may or may not carry an emotional charge
A company should usually try to fit its products into
Describes aa persons relatively consistent
existing attitudes rather than attempt consistent
Describes persons relatively to change
Attitude
Attitude evaluations, feelings, and tendencies toward
attitudes. evaluations, feelings, and tendencies toward
an
an object
object or
or idea
idea
Types of Buying Decision Behavior

Complex Buying Behavior Habitual Buying Behavior

Consumers are highly involved in Occurs under conditions of
a purchase and perceive low-consumer involvement
significant differences among and little significant brand
brands. difference

Variety-Seeking Buying Dissonance-Reducing Buying

Behavior
Occurs in situations
characterized by low
consumer involvement but
significant perceived brand
differences
Behavior
Occurs when consumers are
highly involved with an
expensive, infrequent, or risky
purchase but see little difference
among brands
The Buyer Decision Process
Need Recognition
The buying process starts with need recognition the bu
yer recognizes a problem or need.
The need can be triggered by internal stimuli when one of
the persons normal needs for example, hunger or thirst
rises to a level high enough to become a drive.
A need can also be triggered by external stimuli.
Information Search
Information search is the stage of the buyer decision pro
cess in which the consumer is motivated to search for mo
re information.
Traditionally, consumers have received the most informat
ion about a product from commercial sources that control
led by the marketer.
The most effective sources tend to be personal.
Commercial sources normally inform the buyer, but perso
nal sources legitimize or evaluate products for the buyer.
Evaluation of Alternatives
The alternative evaluation is the stage of the bu
yer decision process in which the consumer uses i
nformation to evaluate alternative brands in the c
hoice set.
Marketers should study buyers to find out how th
ey actually evaluate brand alternatives.
Purchase Decision
The purchase decision is the buyers decision about whic
h brand to purchase.
But two factors can come between the purchase intention
and the purchase decision.
The first factor is the attitudes of others.
The second factor is unexpected situational factors.
Postpurchase Behavior
The postpurchase behavior is the stage of the b
uyer decision process in which consumers take fu
rther action after purchase, based on their satisfac
tion or dissatisfaction.
Almost all major purchases, however, result in co
gnitive dissonance, or discomfort caused by post
purchase conflict.
The Buyer Decision Process for New Pro
ducts
A new product is a good, service, or idea that is perceive
d by some potential customers as new.
We define the adoption process as the mental process thr
ough which an individual passes first learning about an in
novation to final adoption.
Adoption is the decision by an individual to become a reg
ular user of the product.
Stages in the Adoption Process
Five stages in the process of adopting a new product:
Individual Differences in Innovativeness
Early
adopters
In each product
Innovatorsarea, there are consumption pio
Lagging They are guided by
neers and
They are early adopters.
venturesome adopters respect they are
they try new ideas at opinion leaders in their
They are traditional bound
some risk. communities and adopt
they are suspicious of changes
new ideas early but
and adopt the innovation only
carefully.
Early when it has become something
mainstreamof a tradition itself.
Late
They are guided by mainstream
respect they are
They adopt an
opinion leaders in their
innovation only after a
communities and adopt
majority of people
new ideas early but
have tried it.
carefully.
Influence of Product Characteristics on
Rate of Adoption
Five characteristics are especially important in in
fluencing an innovations rate of adoption.
Relative advantage
Compatibility
Complexity
Divisibility
Communicability
The End