Marketing 13th Edition Kerin Solutions Manual 1

Chapter 05 - Understanding Consumer Behavior
Solution Manual for Marketing 13th Edition Kerin and

Hartley 1259573540 9781259573545
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CHAPTER CONTENTS
PAGE
POWERPOINT RESOURCES TO USE WITH LECTURES ........................................... 5-2
LEARNING OBJECTIVES (LO) ......................................................................................... 5-3
KEY TERMS........................................................................................................................... 5-3
LECTURE NOTES
• Chapter Opener: Enlightened Carmakers Know What Custom(h)ers Value ................ 5-4
• Consumer Purchase Decision Process and Experience (LO 5-1; LO 5-2) .................. 5-5
• Psychological Influences on Consumer Behavior (LO 5-3)........................................ 5-13
• Sociocultural Influences on Consumer Behavior (LO 5-4)......................................... 5-21
APPLYING MARKETING KNOWLEDGE ...................................................................... 5-30
BUILDING YOUR MARKETING PLAN .......................................................................... 5-32
VIDEO CASE (VC)

• VC-5: Groupon: Helping Consumers with Purchase Decisions .................................. 5-33
APPENDIX D CASE (D)

5-1
© 2017 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any
manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.
• D-5: Decoding a Purchase Decision ............................................................................ 5-38
IN-CLASS ACTIVITY (ICA)

• ICA 5-1: Buying Process for Starbucks Via™ Refreshers Instant Coffee.................... 5-40
5-2
POWERPOINT RESOURCES TO USE WITH LECTURES

PowerPoint
Textbook Figures Slide
Figure 5-1 Purchase decision process consists of five stages ........................................................... 5-5
Figure 5-2 Common Consumer Selection Criteria for evaluation of smartphones ........................... 5-8
Figure 5-3 Comparison of problem-solving variations: extended, limited, and routine .................. 5-14
Figure 5-4 Influences on the consumer purchase decision process come from both internal and
external sources ............................................................................................................ 5-18
Figure 5-5 Hierarchy of needs ......................................................................................................... 5-20
Figure 5-6 Modern family life cycle stages and flows ..................................................................... 5-36
Selected Textbook Images (Ads, People, Products, and Websites)

Chapter Opener: Woman with a car .................................................................................................... 5-4
Video Case VC-5: Photo of a Groupon offer ..................................................................................... 5-40
Marketing Matters, Making Responsible Decisions, and Marketing Insights

Marketing Matters—Customer Value: How Much is a Satisfied Customer Worth? ......................... 5-12
Making Responsible Decisions—Ethics: The Ethics of Subliminal Messages ................................. 5-23
Marketing Insights About Me: Identifying Your VALS Profile: What Motivates You? ................. 5-30
Marketing Matters—Customer Value: BZZAgent—The Buzz Experience ...................................... 5-33
Videos
5-1: Match.com Video ....................................................................................................................... 5-19
5-2: Dove Video................................................................................................................................. 5-32
5-3: Nissan Ad ................................................................................................................................... 5-39
5-4: Groupon Video Case .................................................................................................................. 5-40
In-Class Activity (ICA)

ICA 5-1: Buying Process for Starbucks Via™ Refreshers Instant Coffee .......................................... 5-46
5-3
LEARNING OBJECTIVES (LO)
After reading this chapter students should be able to:
LO 5-1: Describe the stages in the consumer purchase decision process.
LO 5-2: Distinguish among three variations of the consumer purchase decision process: routine,
limited, and extended problem solving.
LO 5-3: Identify the major psychological influences on consumer behavior.
LO 5-4: Identify the major sociocultural influences on consumer behavior.
KEY TERMS
attitude motivation
beliefs opinion leaders
brand community perceived risk
brand loyalty perception
consumer behavior personality
family life cycle purchase decision process
involvement reference groups
learning social class
subcultures
word of mouth
5-4
LECTURE NOTES
ENLIGHTENED CARMAKERS KNOW WHAT CUSTOM(H)ERS AND

INFLUENC(H)ERS VALUE
• Women are a driving force in the U.S. automobile industry. Women:
a. Influence 80 percent of new-car buying decisions.
b. Are designers, engineers, and marketing executives.
• Women think and feel differently about key elements of the new-car-buying process
than men.
a. The sense of styling.

• Men are concerned about a car’s exterior lines and accents or “curb appeal.”
• Women are concerned about a car’s interior design and finishes, which:
– Fit their proportions. – Offer ample storage space.
– Provide good visibility. – Make for effortless parking.
b. The need for speed.

• Men think about how many seconds it takes to go from 0 to 60 miles per hour.
• Women want to feel secure that the car has enough acceleration when passing
other vehicles.
c. The substance of safety.

• Men want safety features that help avoid an accident, such as antilock brakes
and responsive steering.
• Women want safety features that help survive an accident, such as air bags
and reinforced side panels.
d. The shopping experience.

• Men decide upfront what car they want and set out alone to find it.
• Women approach their car buying behavior as an intelligence-gathering
operation, using “CROPing” or “CRedible OPinions.”
• Before making a purchase decision, women:
– Visit auto-buying websites.
– Read car-comparison articles.
– Scan car advertisements.
– Seek recommendations from family and friends.
– Visit three car dealerships.
5-5
• Women:
– Dislike the car-buying process, particularly negotiating with car dealer
salespeople.
– Prefer a fixed-price policy instead of “haggling” over price because for the
vast majority, price determines the final car purchase decision.
– About half take a man with them to finalize the terms of sale.
• Consumer behavior:
a. Consists of the actions a person takes in purchasing and using products and
services.
b. Includes the mental and social processes that come before and after these actions.
• The behavioral sciences answer questions such as:

a. Why people choose one product or brand over another?
b. How do consumers make these choices?
c. How do companies use this knowledge to provide value to consumers?
I. CONSUMER PURCHASE DECISION PROCESS

AND EXPERIENCE [LO 5-1]
[Figure 5-1] The purchase decision process is the five stages a buyer passes through in
making choices about which products and services to buy:
1. Problem recognition. 4. Purchase decision.
2. Information search. 5. Post-purchase behavior.
3. Alternative evaluation.
[ICA 5-1: Buying Process for Starbucks Via™ Ready Brew Instant Coffee]
A. Problem Recognition: Perceiving a Need
• Problem recognition perceives a difference between a person’s ideal and actual

situations big enough to trigger a decision.
• In marketing, advertisements or salespeople:
a. Can activate a consumer’s decision process by…
b. Showing the shortcomings of competing or currently owned products.
5-6
B. Information Search: Seeking Value
After recognizing a problem, a consumer begins to search for information about

which product or service might satisfy the newly discovered need.
• An internal search:
a. Involves scanning one’s memory for previous experiences with products or

brands.
b. Is often sufficient for frequently purchased products.
• An external search:
a. May be necessary when past experience or knowledge is insufficient.
b. The risk of making a wrong decision is high.
c. The cost of gathering information is low.
• The primary sources of external information are:

a. Personal sources, such as relatives and friends whom the consumer trusts.
b. [Figure 5-2] Public sources, including:
• Product-rating organizations like Consumer Reports.
• Government agencies like the Consumer Product Safety Commission.
• Consumer-oriented TV programs.
c. Marketer-dominated sources, such as information from sellers that include:
• Advertising. • Salespeople.
• Company websites. • Point-of-purchase displays in stores.
C. Alternative Evaluation: Assessing Value
• The information stage clarifies the problem for consumers by:
a. Suggesting criteria to use for the purchase.
b. Providing brand names that might meet the criteria.
c. Developing consumer value perceptions.

• A consumer’s evaluative criteria are:
a. Factors that represent both the objective attributes of a brand and the
subjective ones a consumer uses to compare different products and brands.
b. Often mentioned or displayed in advertisements.
5-7
• Consumers often have several criteria for evaluating brands.
a. This establishes the consideration set—the group of brands that a consumer

would consider acceptable from among all the brands in the product class of
which he or she is aware.
b. Consumers can change their evaluative criteria to create a different

consideration set of models and brands if the alternatives are unsatisfactory.
c. Example: Figure 5-2.

• Evaluative criteria:
– A retail price of $200 or less.
– Superior text messaging.
– Superior battery life
• Resulting consideration set:
– HTC One
– LG G4
– Motorola Dröid Turbo
D. Purchase Decision: Buying Value
• Having examined the alternatives in the consideration set, two choices remain:
a. From whom to buy is determined by an evaluation of:

• The seller’s terms of sale.
• Past purchase experience with that seller.
• The seller’s return policy.
b. When to buy is determined by:

• Whether the product/preferred brand is on sale.
• Whether the manufacturer offers a coupon/rebate.
• The store’s atmosphere/ease of the shopping experience.
• Salesperson assistance.
• Time pressure.
• Financial circumstances.
• The Internet allows consumers to:
a. Gather information.
b. Evaluate alternatives.
5-8
c. Make buying decisions.
• Example: 45 percent of consumers with price comparison smartphone apps:
a. Routinely compare prices for identical products across different sellers…
b. At the point of purchase prior to making a purchase decision.
E. Postpurchase Behavior: Realizing Value
• After buying a product, the consumer:
a. Compares it with his/her expectations and…
b. Is either satisfied or dissatisfied.
• If the consumer is dissatisfied, marketers must determine whether:
a. The product was deficient.
b. Consumer expectations were too high. If expectations are too high:

• A company’s advertising or the salesperson…
• May have oversold the product’s features and benefits.
c. Product deficiency may require a design change.
• Customers’ satisfaction or dissatisfaction with the consumption or use experience

affects consumer communication and repeat-purchase behavior.
a. Satisfied buyers:
• Tell 3 other people about their experience.
• Tend to buy from the same seller each time a purchase decision arises.
b. Dissatisfied buyers:
• About 90 percent will not buy a product again.
• Will complain to 9 people.
c. The financial impact of repeat-purchase behavior can be significant.
5-9
MARKETING MATTERS
Customer Value: How Much is a Satisfied Customer Worth?
What is the financial value of a loyal customer over time?
• Marketers attempt to calculate this figure to demonstrate how much a satisfied

customer is worth. Some examples:
a. Frito-Lay. Loyal customers in the southwestern U.S buy 21 pounds of snack

chips worth $52.50 annually.
b. Exxon. Loyal customers $500 annually for its gasoline, excluding other
purchases made.
c. Kimberly Clark. Loyal customers buy 6.7 boxes of Kleenex tissues annually,
which translates into $994 over 60 years (in today’s dollars).
• These calculations have focused marketer attention on the buying experience,

customer satisfaction, and retention. Example: Ford Motor Company.
a. Set a target of increasing customer retention, which is…

• The percentage of Ford owners whose…
• Next car is also a Ford…
• From 60 percent to 80 percent.
b. Each additional percentage point is worth a staggering $100 million in profits.
• Research shows that:
a. A 5 percent improvement in customer retention…
b. Can increase profits by 70 to 80 percent!
• The goal of many firms is to focus on postpurchase behavior to:
a. Maximize customer satisfaction, which…
b. Can lead to increased retention.

c. Tools to do this include:
• Provide toll-free telephone numbers.
• Offer liberalized return and refund policies.
• Engage in extensive staff training to
– Handle complaints. – Record suggestions.
– Answer questions. – Solve consumer problems.
5-10
d. Such efforts:
• Produce positive postpurchase communications among consumers.
• Foster relationship building between sellers and buyers.
• Consumers are often faced with two or more highly attractive alternatives when
making a purchase.
a. After purchasing a product, they may have second thoughts and ask the
question, “Should I have purchased this?”
b. Cognitive dissonance is the feeling of postpurchase psychological tension or

anxiety consumers may experience when faced with two or more highly
attractive alternatives.
c. After a purchase, consumers often seek information or approval from others or

reading ads or reviews about the brand to affirm their choice.
d. Firms often use ads or follow-up calls from salespeople in this postpurchase
stage to try to comfort buyers that they made the right decision.
F. Consumer Involvement Affects Problem-Solving [LO 5-2]
• Sometimes consumers don’t engage in the five-stage purchase decision process

depending on their level of involvement.
• Level of involvement.
a. Is the personal, social, and economic significance of the purchase to the

consumer.
b. Consumers may sometimes skip or minimize one or more steps in the

purchase decision process.
c. High-involvement purchases have at least one of three characteristics:

• Is expensive.
• Can have serious personal consequences.
• Could reflect on one’s social image.
• With high involvement purchases, consumers are:

• Engaged in extensive information search.
• Consider many product attributes and brands.
• Use word-of-mouth.
• Low-involvement purchases barely involve any thought.
5-11
• [Figure 5-3] There are three general problem-solving variations in the consumer
purchase decision process.
1. Extended Problem Solving.
a. Each of the five stages of the consumer purchase decision process is used.
• Includes considerable time and effort on external information search.
• Identifies and evaluates the attributes of several brands in the
consideration set.
b. Exists in high-involvement purchases (autos, audio systems, etc.).
2. Limited Problem Solving.
a. Consumers seek some information or rely on friends to evaluate alternative

brands and attributes.
b. Is used in purchase situations that do not merit a great deal of time or effort.
3. Routine Problem Solving.
a. Consumers spend little effort seeking external information and evaluating

alternatives.
b. The purchase process is habitual.

c. Typifies low-involvement decision making.
d. Is used for low-priced, frequently purchased products (salt, milk, etc.).
4. Consumer Involvement and Marketing Strategy.

a. For low-involvement products whose brands are market share leaders,
marketers should:
• Maintain product quality.
• Avoid stockouts so buyers won’t substitute a competing brand.
• Develop and air repetitive ads that:
– Reinforce consumers’ knowledge or…
– Assure buyers that they made the right choice.
b. For low-involvement products whose brands are market challengers,

marketers should break consumer habits by:
• Using free samples, coupons, and rebates to encourage trial of their brand.
• Developing ads that get their brand into a consumer’s consideration set.
• Linking brand attributes with high involvement issues.
5-12
c. For high-involvement products whose brands are market share leaders,

marketers should use:
• Advertising and personal selling.
• Social media to create online experiences for their company or brand.
d. For high-involvement products whose brands are market challengers,

marketers should use:
• Comparative advertising that focus on existing product attributes.
• Novel evaluative criteria for judging competing brands.
• Internet search engines like Google or Bing to assist buyers.
G. Situational Influences that Affect Purchase Decisions
• Five situational influences impact the consumer’s purchase decision process:
a. Purchase task. The reason for engaging in the decision.
b. Social surroundings. Others present when making a purchase decision.
c. Physical surroundings. Store decor, music, and crowding.
d. Temporal effects. Time of day or time available.
e. Antecedent states. The consumer’s mood or cash on hand.
• [Figure 5-4] shows the many influences that affect the consumer purchase
decision process.
• The decision to buy a product also involves important psychological and

sociocultural influences.
LEARNING REVIEW
5-1. What is the first stage in the consumer purchase decision process?
Answer: problem recognition—perceiving a need
5-2. The brands a consumer considers buying out of the set of brands in a product
class of which the consumer is aware are collectively called the __________.
Answer: consideration set
5-3. What is the term for postpurchase anxiety?
Answer: cognitive dissonance
5-13
II. PSYCHOLOGICAL INFLUENCES ON

CONSUMER BEHAVIOR [LO 5-3]
• Psychology helps marketers understand why and how consumers behave as they do.
• Concepts such as motivation and personality; perception; learning; values, beliefs,

and attitudes; and lifestyle are useful for interpreting buying processes.
A. Consumer Motivation and Personality
Motivation and personality explain why people do some things and not others.
1. Motivation.
a. Motivation is the energizing force that stimulates behavior to satisfy a need.
b. Marketers try to arouse these needs.
c. [Figure 5-5] These needs are hierarchical, ranging from basic to learned
needs:
• Physiological needs, such as water, food, and shelter, are basic to survival
and must be satisfied first.
• Safety needs involve self-preservation, such as physical and financial well-
being.
• Social needs are concerned with love and friendship.
[Video 5-1: Match.com Video]

• Personal needs involve the need for achievement, status, prestige, and
self-respect.
• Self-actualization needs involve personal fulfillment.
2. Personality.
a. Personality refers to a person’s consistent behaviors or responses to recurring

situations.
b. Key personality traits:

• Are enduring characteristics within a person or in his or her relationship
with others.
• Include assertiveness, extroversion, and compliance, dominance,
aggression, among others.
• Are inherited or formed at an early age and change little over the years.
• Are often linked with certain tastes or preferences.
5-14
c. A person’s self-concept is the way:

• People see themselves.
• They believe others see them.
d. People:
• Have an actual self-concept (how they see themselves).
• Have an ideal self-concept (how they want to see themselves).
• Reflect these images in the products and brands they buy.
B. Consumer Perception
Perception is the process by which an individual selects, organizes, and interprets

information to create a meaningful picture of the world.
1. Selective Perception.
a. Is the filtering process of exposure, comprehension, and retention by the

human brain to organize and interpret information.
b. Consists of:
• Selective exposure.
– Occurs when people:
* Pay attention to messages that are consistent with their own
attitudes and beliefs.
* Ignore messages that are inconsistent with them.
– Assures buyers that they made the right choice.
– During the postpurchase stage when consumers read ads for the brand
they just bought.
– When a need exists, such as being hungry.
• Selective comprehension.
– Involves interpreting information so that it is consistent with a
person’s attitudes and beliefs.
– A marketer’s failure to understand this can have disastrous results.
– Example: Toro’s Snow Pup snowblower was renamed the Snow
Master.
• Selective retention.
– Means that consumers do not remember all the information they see,
read, or hear, even minutes after exposure to it.
– Affects the internal and external components of the information search
stage of the consumer decision process.
5-15
• Subliminal perception.
– Means that people see or hear messages without being aware of them.
– Is a hotly debated issue, with more popular appeal than scientific
support.
– Evidence suggests that subliminal messages have little effect on
behavior.
MAKING RESPONSIBLE DECISIONS

Ethics: The Ethics of Subliminal Messages
Embedded messages and images have been a controversial topic for over 50 years.
• The Federal Communications Commission (FCC) has denounced subliminal

messages as deceptive.
• Consumers:
a. Spend $50 million a year for subliminal messages designed to help them raise
their self-esteem, stop compulsive buying, quit smoking, or lose weight.
b. Almost two-thirds think subliminal messages are present in commercial

communications.
c. About half are firmly convinced that this practice can cause them to buy
things they don’t want.
• Subliminal messages are not illegal in the U.S.
• Marketers have been criticized for creating them for use in print and electronic media.
2. Perceived risk.
a. Represents the anxiety felt because the consumer cannot anticipate the
outcomes of a purchase but believes that there may be negative consequences.
b. Negative consequences of perceived risk include the:

• Size of the financial outlay required to buy the product.
• Risk of physical harm.
• Performance of the product.
• Psychosocial—what will other people think or say about my purchase.
c. Perceived risk affects a consumer’s information search because the greater the
perceived risk, the more extensive the external search is likely to be.
5-16
d. Marketers try to reduce a consumer’s perceived risk and encourage purchases

by using one or more strategies:
• Obtaining seals of approval—Fresh Step’s Good Housekeeping seal.
• Securing endorsements from influential people—Promise soft spread.
• Providing free trials of the product—Mary Kay’s Velocity fragrance.
• Giving extensive usage instructions—Clairol hair coloring.
• Providing warranties and guarantees—Kia Motor’s warranty.
C. Consumer Learning
• Much consumer behavior is learned, such as:
a. Information sources to consult about products.
b. Evaluative criteria to use to assess alternatives.
c. How to make purchase decisions.
• Learning: Those behaviors that result from repeated experience and reasoning.
1. Behavioral Learning.
a. Is the process of developing automatic responses to a type of situation built up

through repeated exposure to it.
b. Four variables are key to how consumers learn from repeated experience:
• A drive is a need that moves an individual to action.
• A cue is a stimulus or symbol that is perceived.
• A response is the action taken to satisfy the drive.
• A reinforcement is the reward.
c. Marketers use two concepts from behavioral learning theory:

• Stimulus generalization occurs when a response elicited by one stimulus
(cue) is generalized to another stimulus.
• Stimulus discrimination refers to a person’s ability to perceive differences
in stimuli among similar products.
2. Cognitive Learning.
a. Occurs through thinking, reasoning, and mental problem solving without

direct experience.
5-17
b. Involves:
• Making connections between two or more ideas.
• Observing the outcomes of others’ behaviors.
• Adjusting one’s own behavior accordingly.
c. Firms influence this type of learning by:

• Using repetitive advertising messages.
• Linking a brand to an idea.
• Showing someone using the brand.
3. Brand Loyalty.
a. Is a favorable attitude toward and consistent purchase of a single brand over

time.
b. Relates to habit formation—the basis for routine problem solving.
c. Results from positive reinforcement of previous actions.
d. Reduces risk and saves time due to favorable, consistent results.

e. Appears to be declining in North America, Western Europe, and Japan.
D. Consumer Values, Beliefs, and Attitudes
These play a central role in consumer decision making and related marketing actions.
1. Attitude Formation.
a. An attitude is a learned predisposition to respond to an object or class of
objects in a consistently favorable or unfavorable way.
• Attitudes shaped by our values and beliefs, which are learned.
• Values vary by level of specificity and include:
– Core values, such as material well-being and humanitarianism.
– Personal values, such as thriftiness and ambition.
• Marketers are more concerned with personal values, which affect attitudes
by influencing the importance assigned to specific product attributes.
b. Beliefs are a consumer’s subjective perception of how a product or brand

performs on different attributes.
• Beliefs are based on personal experience, advertising, and discussions
with other people.
• Beliefs about product attributes create the favorable or unfavorable
attitudes the consumer has toward certain products, services, and brands.
5-18
2. Attitude Change.
Marketers use three approaches to try to change consumer attitudes toward

products and brands:
a. Changing beliefs about the extent to which a brand has certain attributes—
Hellmann’s mayonnaise Omega 3 content.
b. Changing the perceived importance of attributes—Pepsi’s freshness dating.
c. Adding new attributes to the product—Colgate’s Total toothpaste with anti-

bacterial tricloson ingredient.
E. Consumer Lifestyle
• Lifestyle is a mode of living that is identified by:
a. How people spend their time and resources.

b. What they consider important in their environment.
c. What they think of themselves and the world around them.
• Psychographics:
a. Combines consumer psychology, lifestyle, and demographics to uncover
motivations for buying and using offerings.
b. Provides insights into consumer needs and wants.
c. Is used for segmenting and targeting consumers for new and existing
offerings.
• [Figure 5-6] VALS is a psychographic system that identifies eight (8) consumer
segments based on their:
a. Primary motivation for buying and having certain products and services.
b. Resources.
• According to VALS researchers, consumers buy products and services and seek
experiences that give shape, substance, and satisfaction to their lives.
a. Consumers are inspired by one of three primary motivations—ideals,
achievement, and self-expression—that give meaning to them or the world
and govern their activities.
b. The different levels of resources enhance or constrain a person’s expression of
his or her primary motivation.
c. A person’s resources include psychological, physical, demographic, and
material capacities such as income, self-confidence, and risk-taking.
5-19
MARKETING INSITE
Identifying Your VALS Profile: What Motivates You?
The VALS system, run by Strategic Business Insights, has identified eight unique
consumer segments based on a person’s primary motivation and resources. To know your
VALS profile, complete the VALS survey at www.strategicbusinessinsights.com. Click on
the “VALS” link and then the “Take the VALS Survey” link.
d. VALS explains why and how consumers make purchase decisions.

• Ideals-motivated groups. Consumers motivated by ideals are guided by
knowledge and principles. They are divided into two segments:
– Thinkers:
* Are mature, reflective, and educated who value order, knowledge,
and responsibility.
* Are practical, deliberate information seekers.
* Value durability and functionality in products over style and
newness.
– Believers:
* Have fewer resources.
* Are conservative (family, religion, community, and the nation).
* Choose familiar products and brands.
* Favor American-made brands.
* Are brand loyal.
• Achievement-motivated groups. Consumers motivated by achievement
look for products and services that demonstrate success to their peers or to
a peer group they aspire to. These include:
– Achievers:
* Are busy, goal-directed, and have a deep commitment to career
and family.
* Are concerned about their self-image.
* Prefer established, prestige offerings.
* Are interested in timesaving devices.
– Strivers:
* Are trendy, fun-loving, and less self-confident than achievers.
* Have lower levels of education and household income.
* Believe that money defines their success.
* Favor stylish products.
5-20
* Are as impulsive as their financial circumstances permit.

• Self-expression-motivated groups. Consumers motivated by self-
expression desire social or physical activity, variety, and risk. These
include:
– Experiencers:
* Are young, enthusiastic, and impulsive consumers who become
excited about new possibilities.
* Savor the new, the offbeat, and the risky.
* Engage in exercise, sports, outdoor recreation, and social activities.
* Spend income on fashion items, entertainment, socializing, looking
good, and having the latest things.
– Makers:
* Have fewer resources.
* Express themselves by working—building a house, raising
children, or fixing a car.
* Are practical, value self-sufficiency, and are unimpressed by
material possessions.
• High- and low-resource groups. These include:
– Innovators:
* Are successful, sophisticated, take-charge people with high self-
esteem and abundant resources.
* Are concerned about their self-image as an expression of cultivated
tastes, independence, and character.
* Are receptive to new ideas and technologies and like variety.
– Survivors:
* Have the least resources of any segment.
* Focus on meeting basic needs rather than fulfilling desires.
* Are a modest market for most products and services.
* Are loyal to favorite brands, especially those that can be purchased
at a discount.
e. Each of the eight VALS segments exhibits unique media preferences.
• Experiencers and Strivers are the most likely to visit Internet chat rooms.
• Innovators, Thinkers, and Achievers tend to read business and news
magazines such as Fortune and Time.
• Makers read automotive magazines.
• Believers are the heaviest readers of Reader’s Digest.
5-21
f. GeoVALS™ estimates the percentage of each VALS group by zip code.
LEARNING REVIEW
5-4. The problem with the Toro Snow Pup was an example of selective __________.
Answer: comprehension—Consumers perceived the name to mean that Snow Pup was
a toy that was too light to do any serious snow removal
5-5. What three attitude-change approaches are most common?
Answer: (1) Change beliefs about the extent to which a brand has certain attributes.
(2) Change the perceived importance of these attributes. (3) Add new attributes to the
product.
5-6. What does lifestyle mean?
Answer: Lifestyle is a mode of living that is identified by how people spend their time
and resources, what they consider important in their environment, and what they think
of themselves and the world around them.
III. SOCIOCULTURAL INFLUENCES ON

CONSUMER BEHAVIOR [LO 5-4]
Sociocultural influences evolve from a consumer’s formal and informal relationships
with other people and exert a significant impact on consumer behavior.
A. Personal Influence
A consumer’s purchases are often influenced by the views, opinions, or behaviors of

others.
1. Opinion Leadership.
a. Opinion leaders:
• Are individuals who exert direct or indirect social influence over others.
• Are considered to be knowledgeable about or users of particular offerings.
• Influence others’ choices regarding the purchase of autos, entertainment,
clothing, electronics, food, and investments.
b. Since about 10 percent of U.S. adults are opinion leaders, identifying,

reaching, and influencing them is a challenge.
c. Some firms use celebrities as spokespersons to represent their products.
d. Others promote their products in media believed to reach opinion leaders.
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e. Still others use direct contact to approach opinion leaders and persuade them
to recommend their products.
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2. Word of Mouth.
a. Is people influencing each other during conversations.
b. Is a powerful and authentic information source for consumers because it

involves friends viewed as trustworthy.
c. According to a recent study about consumer conversations about brands:

• 75 percent of all happen face-to-face.
• 15 percent happen over the phone.
• 10 percent happen online.
d. 67 percent of U.S. consumer product sales are directly based on word-of-

mouth activity among friends, family, etc.
e. Example: “teaser” advertising campaigns are run in advance of new-product

introductions to stimulate word of mouth.
f. Firms also use advertising slogans, music, and humor to heighten positive
word of mouth.
g. Companies recruit and deploy people to produce buzz—popularity created by

consumer word of mouth.
MARKETING MATTERS
Customer Value: BzzAgent—The Buzz Experience
BzzAgent has a nationwide army of one million people who promote products and
services they deem worth talking about. BzzAgent’s founder David Bolter says, “Our goal is
to capture honest word of mouth and to build a network that turns passionate customers into
brand evangelists.” Agents sign up for a buzz campaign, receive a sample product for the
buzz, and then file online reports describing the nature and effectiveness of the buzz.
[Video 5-2: Dove Video]

h. Overcoming or neutralizing negative word of mouth is difficult and costly.
Marketers have found the following helpful in reversing poor word of mouth:
• Supplying factual information.
• Providing toll-free numbers for consumers to call the company.
• Giving appropriate product demonstrations.
i. The Internet, through online forums, blogs, social media, and websites, has
magnified the power of word of mouth.
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j. With respect to their products, services, and brands, companies:

• Use special software to monitor online messages and find out what
consumers are saying about them.
• Have found that 30 percent of people spreading negative information have
never owned or used them.
B. Reference Group Influence
• Reference groups.
a. Are people to whom an individual looks as a basis for self-appraisal or as a

source of personal standards.
b. Influence the information, attitudes, and aspiration levels that help set a
consumer’s standards for luxury products but not necessities.
c. Exert a strong influence on the brand chosen when its use or consumption is
highly visible to others.
• Three reference groups have marketing implications:
a. An associative group:
• Is one to which a person actually belongs, such as fraternities and
sororities, social clubs, etc.
• Is easily identifiable.
• Can form around a brand. Example: the HOG (Harley Owners Group).
• A brand community:
– Is a specialized group of consumers with a structured set of
relationships…
– Involving a particular brand, fellow customers of that brand, and the
product in use.
• A consumer who is a member of a brand community thinks about:
– Brand names (e.g., Harley-Davidson).
– The product category (e.g., motorcycles).
– Other customers who use the brand (e.g., HOG members).
– The marketer that makes and promotes the brand.
b. An aspiration group:
• Is one that a person wishes to be a member of or identified with, such as a
professional society.
• Firms frequently rely on spokespeople or settings associated with their
target market’s aspiration group in their advertising.
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c. A dissociative group:
• Is one that a person wishes to maintain a distance from due to differences
in values or behaviors.
• Firms often avoid dissociative reference groups in their marketing.
C. Family Influence
Family influences on consumer behavior result from three sources:
1. Consumer Socialization.
a. Is the process by which people acquire the skills, knowledge, and attitudes
necessary to function as consumers.
b. Children learn how to purchase by:

• Interacting with adults in purchase situations.
• Engaging in their own purchasing and product usage experiences.
c. Research shows that children evidence brand preferences at age two, and these
preferences often last a lifetime.
d. This knowledge has caused many companies to market to children.
2. Family Life Cycle.
a. [Figure 5-7] Describes the distinct phases that a family progresses through
from formation to retirement…
b. Each phase bringing with it identifiable purchasing behaviors.
c. Consists of the following progression and contemporary variations:

• The traditional family.
– Consists of married couples with children under 18 years.
– Comprises only 21 percent of all U.S. households.
• Young singles.
– Have buying preferences for nondurable items: prepared foods,
clothing, personal care products, and entertainment.
– Represent a target market for recreational travel, automobile, and
consumer electronics firms.
• Young married couples without children.
– Are typically more affluent than young singles because usually both
spouses are employed.
– Buy furniture, housewares, and gift items for each other.
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• Young marrieds with children.

– Are driven by the needs of their children.
– Represent a sizable market for life insurance, various children’s
products, and home furnishings.
• Single parents with children.
– Are the least financially secure.
– Have buying preferences that tend toward convenience foods,
childcare services, and personal care items.
• Middle-aged married couples with children.
– Are typically better off financially than their younger counterparts.
– Represent a significant market for leisure products and home
improvement items.
• Middle-aged couples without children.
– Have a large amount of discretionary income.
– Buy better home furnishings, status automobiles, and financial
services.
• Older married and older unmarried. Represent a sizable market for
prescription drugs, medical services, vacation trips, and gifts for younger
relatives
3. Family Decision Making.
a. Two decision-making styles exist that occur within a family:

• Spouse-dominant decisions. Are those for which either:
– The husband (home and car maintenance purchases) or…
– The wife (groceries, toys, clothing, etc.) is mostly responsible.
• Joint decision-making style.
– Both husband and wife jointly make decisions regarding cars,
vacations, houses, home appliances, electronics, and medical care.
– Joint decision-making increases with the education of the spouses.
b. Five roles of individual family members exist in the purchase process:

• Information gatherer. • Purchaser.
• Influencer. • User.
• Decision maker.
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c. Family members assume different roles for different products and services.
• 89 percent of wives either influence or make purchases of men’s clothing.
• 31 percent of men are the primary grocery shopper in their household.
d. Preteens and teenagers:

• Are the information gatherers, influencers, decision makers, and
purchasers of products and services for the family…
• Given the prevalence of working parents and single-parent households.
• The market for products bought by or for preteens and teenagers surpasses
$208 billion annually.
• Companies spend more than $70 billion annually in print and electronic
media that reach preteens and teens.
D. Social Class Influence
• Social class is the relatively permanent, homogeneous divisions in a society into

which people sharing similar values, interests, and behavior can be grouped.
• A person’s occupation, source of income (not level of income), and education

determine his or her social class.
• Three major social class categories exist—upper, middle, and lower—with

subcategories within each.
• Persons within social classes exhibit common values, attitudes, beliefs, lifestyles,
and buying behaviors.
• Persons in the lower classes have a short-term orientation, think in concrete, not
abstract terms, and see fewer personal opportunities.
• Members of the upper classes focus on achievements and the future and think in
abstract or symbolic terms.
• Firms use social class to:
a. Identify and reach prospects for their products and services.
b. Recognize differences in media preferences among classes.
[Video 5-3: Nissan Ad]

E. Culture and Subculture Influences
• Culture refers to the set of values, ideas, and attitudes that are learned and shared
among the members of a group.
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• Subcultures are subgroups within the larger, or national, culture with unique
values, ideas, and attitudes.
• Collectively, Hispanics, African Americans, and Asian Americans are projected

to spend about $2.5 trillion for goods and services in 2017.
1. Hispanic Buying Patterns.
a. Hispanics represent the largest racial/ethnic subculture in the U.S. in terms of

population and buying power.
b. About 50% are immigrants.
c. The majority is under the age of 27.
d. One-third are younger than 18.
e. According to research, in terms of their buying practices, Hispanics:

• Are quality and brand conscious.
– Willing to pay a premium price for premium quality.
– Are often brand loyal.
• Prefer buying American-made products that cater to their needs.
• Are influenced by family and peers.
• Consider advertising a credible information source about products. As a
result, U.S. firms spend over $6 billion annually on Hispanic advertising.
• Do not consider convenience an important product attribute as it relates to
food preparation or consumption.
f. Marketing to Hispanics is difficult because:

• Its subculture is diverse, composed of Mexicans, Puerto Ricans, Cubans,
and others of Central and South American ancestry.
• Cultural differences in these groups affect product preferences.
• A language barrier exists, and commercial messages are frequently
misinterpreted when translated into Spanish.
g. Marketers who are sensitive to the needs of Hispanics can significantly

expand their firm’s market share.
2. African American Buying Patterns.
a. African Americans have the second-largest spending power of the three

racial/ethnic subcultures in the U.S.
b. When socioeconomic status is ignored, African Americans and Caucasians

have more similarities than differences in terms of their buying patterns.
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c. Differences in buying patterns:

• Are greater within the African American subculture than…
• Between African Americans and Caucasians of similar status due to…
• Levels of socioeconomic status.
d. There are some consumption patterns that do differ between African

Americans and Caucasians:
• African Americans spend far more than Caucasians on boy’s clothing,
rental goods, and audio equipment.
• African American women spend three times more on health and beauty
products than Caucasian women.
• The typical African American family:
– Is five years younger than the typical Caucasian family, which…
– Accounts for some of the observed differences in preferences for
clothing, music, shelter, cars, and many other products, services, and
activities.
• Historically, African Americans:
– Have been deprived of employment and educational opportunities in
the United States, which…
– Have resulted in income disparities between them and Caucasians,
which influence purchase behavior.
e. African Americans are motivated by product quality, price, and choice.
f. African Americans respond to products and advertising that appeal to their

pride, heritage, ethnic features, and needs.
3. Asian American Buying Patterns.
a. Asian Americans are the fastest growing racial/ethnic subculture in the United
States.
b. About 70 percent of Asians are immigrants, with most under the age of 30.
c. The Asian subculture:

• Is very diverse.
• Includes Chinese, Japanese, Filipinos, Koreans, etc.
• Making generalizations about its buying patterns is difficult.
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d. Two groups of Asian Americans have been identified:

• Assimilated Asian Americans are:
– Conversant in English.
– Highly educated.
– Hold professional and managerial positions.
– Exhibit buying patterns very much like the typical American
consumer.
• Nonassimilated Asian Americans are recent immigrants who still cling to
their native languages and customs.
e. Exceeding those of any other ethnic group, this subculture is characterized by:
• Hard work. • Appreciation for education.
• Strong family ties. • Median family incomes.
f. This subculture is the most entrepreneurial in the U.S., as evidenced by the

number of Asian-owned businesses.
LEARNING REVIEW
5-7. What are the two primary forms of personal influence?
Answer: (1) opinion leadership—persons considered to be knowledgeable about or

users of particular products and services and (2) word of mouth—the influencing of
people (friends, family, and colleagues) during conversations.
5-8. Marketers are concerned with which types of reference groups?
Answer: Three reference groups have clear marketing implications: (1) associative
groups—ones to which a person actually belongs, such as a brand community that
consists of a specialized group of consumers with a structured set of relationships
involving a particular brand; (2) aspiration groups—ones that people wish to be a
member of or identified with; and (3) dissociative groups—ones that people wish to
maintain a distance from because of differences in values or behaviors.
5-9. What two challenges must marketers overcome when marketing to Hispanic
consumers?
Answer: (1) The diversity of nationalities among this subculture that affect product
preferences. (2) The language barrier that can lead to misinterpretation or
mistranslation of commercial messages when translated into Spanish.
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APPLYING MARKETING KNOWLEDGE
1. Review Figure 5-2, which shows the smartphone attributes identified by Consumer
Reports. Which attributes are important to you? What other attributes might you
consider? Which brand would you prefer?
Answers: Smartphone attributes that are considered important include:
Price Web browsing

Display quality Camera image quality
Voice quality Battery life
Messaging
Based on the attributes shown in Figure 5-2, the Samsung Galaxy S 4 and the Motorola
Dröid Razr Maxx HD have the highest ratings.
2. Suppose research at Panasonic reveals that prospective buyers are anxious about
buying high-definition television sets. What strategies might you recommend to the
company to reduce consumer anxiety?
Answers:
Strategies Panasonic might adopt in order to reduce uncertainty perceptions by prospective

buyers include:
a. Focus promotional activities on the benefits of better picture, higher quality, and greater
enjoyment from watching in the comfort of your own home.
b. Create ads showing ease of operation to produce a higher-quality picture.
c. Provide high customer service at point of purchase.
3. Assign one or more levels of the Maslow hierarchy of needs and the motives described
in Figure 5-5 to the following products: (a) life insurance, (b) cosmetics, (c) The Wall
Street Journal, and (d) hamburgers.
Answers:
Item or Action Need

a. Life insurance Safety
b. Cosmetics Social
c. The Wall Street Journal Personal
d. Hamburgers Physiological
4. With which stage in the family life cycle would the purchase of the following products
and services be most closely identified: (a) bedroom furniture, (b) life insurance,
(c) a Caribbean cruise, (d) a house mortgage, and (e) children’s toys?
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Answers:
Product or Service Stage in the Family Life Cycle

a. Bedroom furniture Young married without children
b. Life insurance Young married with children
c. Caribbean cruise Older married or older unmarried
d. House mortgage Young married with or without children
e. Children’s toys Young married with children;
older married/unmarried
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BUILDING YOUR MARKETING PLAN
To conduct a consumer analysis for the product—the good, service, or idea—in your
marketing plan:
1. Identify the consumers who are most likely to buy your product—the primary
target market—in terms of (a) their demographic characteristics and (b) any other
kind of characteristics you believe are important.
2. Describe (a) the main points of difference of your product for this group and
(b) what problem they help solve for the consumer in terms of the first stage of the
consumer purchase decision process in Figure 5-1.
3. For each of the four outside boxes in Figure 5-4 (marketing mix, psychological,
sociocultural, and situational influences), identify the one or two key influences with
respect to your product.
This consumer analysis will provide the foundation for the marketing mix actions
you develop later in your plan.
For existing businesses, a look at company records or scrutiny of customers visiting the
shop may provide specifics on the characteristics of the primary target market customers. This
may also suggest key new segments to try to reach. For new businesses, students may refer to
Chapter 9 to discover alternative ways to segment potential customers.
What makes our product or service more desirable to potential customers than offerings
of competitors? These are the key “points of difference” that are the foundation for possible
success for the product or service described in the student marketing plan. Typically, these
points of difference tie to a customer problem to be solved—a more convenient location, better
service, higher-quality offering, and so on.
The influences that emerge in this step often become the basis for marketing mix
decisions developed later in the student plan.
Helping with Common Student Problems
Student marketing plans often lack clear definitions of (a) the primary target market
segments of customers and (b) points of difference. Without these, the marketing plan quickly
loses focus.
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TEACHING NOTE FOR VIDEO CASE VC-5
Groupon: Helping Consumers with Purchase Decisions
This case describes the popularity and success of Groupon—a company that reached $5.4
billion in gross billings in just four years. Much of Groupon’s popularity and success can be
attributed to the company’s understanding of consumer behavior and how its service provides
value to consumers.
[Video 5-4: Groupon Video Case (kerin.tv/13e/v5-4)]

Synopsis
Show Slide 5-40. Groupon founder Andrew Mason started with a website called
ThePoint.org, which was designed to organize campaigns, protests, boycotts, and fund-raising
drives for important social issues. With that idea, Mason launched Groupon in October 2008
with a two-pizzas-for-the-price-of-one offer. The concept quickly grew in Chicago and
Groupon expanded into other U.S. cities, and then into other countries. Today, Groupon is
available in 375 American cities and 40 countries, and its subscriber base has grown from 400
in 2008 to 200 million today.
Part of Groupon’s success is because of the simplicity of its business —offer

subscribers at least one deal in their city each day. The unique aspect of the concept is that a
certain number of people need to buy into the offer before the coupon discount is valid.
Another reason Groupon has grown as quickly as it has is because it really understands
consumer behavior. Generally, Groupon consumers follow the same purchase decision
process common to many consumer purchases. Psychological, sociocultural, and situational
factors also influence Groupon user’s purchase behavior.
As popular as Groupon has become it does face three challenges. The first challenge is
related to the use of coupons. Another challenge facing Groupon is managing its growth.
Finally, Groupon faces an extraordinary level of competition. In the future, Groupon’s
strategies will require continued attention to these challenges and to understanding consumers
around the globe.
Teaching Suggestions
A useful way to introduce the video is to ask how many students have used Groupon. It
is popular online and as a mobile app so many of your students should be familiar with the
company. Use that discussion to:
1. Ask the students who have used a Groupon to describe their purchase decision process,
possibly using the steps described in Figure 5-1 (problem recognition, information
search, alternative evaluation, purchase decision, and post-purchase behavior).
2. Follow-up by asking students to give their impressions of the Groupon experience

relative to other purchases. For example, did the Groupon encourage them to try
something new? Did any of the students made good on the Groupon Promise? Did they
become a repeat customer of the retailer?
5-35
3. Finally, ask them if they use or consider any of Groupon’s competitors (e.g.
LivingSocial, Facebook, Crowdsaver, Opentable, etc.).
Answers to Questions
1. How has an understanding of consumer behavior helped Groupon grow from 400
subscribers in Chicago in 2008 to 200 million subscribers in 40 countries today?
Answer:
“Part of the reason that Groupon has grown as quickly as it has is because we really
understand consumer behavior,” explains Julie Mossler, PR & Consumer Marketing
Manager at Groupon. Generally, Groupon consumers follow the same purchase decision
process common to many consumer purchases. In the future, Groupon’s strategies will
require continued attention to understanding consumers around the globe. Mossler
explains, “Groupon has been heralded as the fastest growing company of all time, and the
reason for that is that is because we have solved this unsolvable problem, which is how do
you engage with local customers…the model really works anywhere as long as you adapt
for local communities.”
2. What is the Groupon Promise? How does the Groupon Promise affect a consumer’s
perceived risk and cognitive dissonance?
Answers:
a. The Groupon Promise. The Groupon Promise states that any customer can return a
Groupon, no questions asked—even if they used it—if they feel like Groupon has let
them down.
b. How the Groupon Promise affects consumers. The Groupon Promise reduces
perceived risk; namely the “uncertainty” of unwelcome outcomes and negative
financial consequences of a poor choice. Similarly, the Groupon Promise affects
cognitive dissonance by reducing post purchase anxiety or tension by offering a “no
questions asked” return policy even if the Groupon was used.
3. Describe the five-stage purchase decision process for a typical Groupon user.
Answer:
The five-stage purchase process consists of problem recognition, information search,

alternative evaluation, purchase decision, and post-purchase behavior. The purchase
decision process applies to a Groupon user as follows:
a. Problem Recognition. This is triggered by a Groupon deal-of-the-day e-mail offer for

something that someone wouldn’t ordinarily do. Groupon Now presents real-time
offers on smartphone apps in response to an immediate need in a specific location.
b. Information Search. A Groupon offer can initiate an “internal search,” whereby the
consumer might reflect on prior experiences with merchant making the offer. Also, a
5-36
Groupon offer can activate an “external search,” leading to on-line comparisons with
competitors, or discussing the offer with friends on Facebook or Twitter.
c. Alternative Evaluation. Many Groupon customers focus on price as the most

important evaluative criteria, although other aspects of the offer, such as quality or time
restrictions, may also apply.
d. Purchase Decision. The purchase decision is made online and then confirmed when
the deals tip.
e. Postpurchase Behavior. After the purchase and use of the Groupon offer, consumers
compare the purchase and use experience with their expectations and are satisfied or
dissatisfied.
4. What are possible psychological and sociological influences on the Groupon consumer
purchase decision process?
Answers:
Psychological, sociocultural, and situational factors also influence Groupon users’ purchase
behavior. The recession increased the importance of personal values such as thriftiness, so
deal-prone people who were attracted to websites such as Gilt in fashion and Woot in
consumer electronics are also attracted to Groupon. The typical Groupon user is an 18-34
year-old woman with an average income of about $70,000. This is significant because this
group’s affinity to social media enables the use of Groupon, which depends on e-mail and
smartphone apps to reach its customers. Specific situations, such as planning entertainment
activities, finding a close restaurant for lunch, or buying a gift, are also common to
Groupon users. As Groupon has learned more about its subscribers, it has begun
personalizing the deals they see. The company uses variables such as gender, location of
residence or office, and buying history to match deals with the customers. This process
provides offers that are more likely to be of interest to consumers and allows Groupon to
serve more merchants.
5. What challenges does Groupon face in the future? What actions would you
recommend related to each challenge?
Answers:
Groupon faces three challenges in the future:
a. Groupon use and repeat purchases. Some consumers buy the coupons but never use
them, eventually leaving them dissatisfied and unlikely to use Groupon again. Some
consumers use the coupons but do not become regular customers. Because of the deep
discounts used to sell the coupons, most of the deals are not profitable for the
merchants, so they are dissatisfied if the Groupon users do not make repeat purchases.
Actions that may address this challenge include:
• Reminder messages to consumers who have not used their coupon.
• Reduced restrictions on the use of the coupons.
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• Better segmentation to ensure that consumers who receive offers may become
repeat customers.
b. Rapid growth. The company has expanded into Europe, Latin America, Asia, and
Russia by acquiring local daily-deal services. As a result, Groupon currently has more
subscribers abroad than in the U.S., although more deals are still sold in the U.S.
Actions include:
• Expand the number of deals available outside the U.S.
• Develop a comprehensive understanding of the differences in international buying
behaviors.
c. Competition. The daily deal technology is not very sophisticated and the model is
easy to copy. Other daily deal companies, such as LivingSocial, and manufactures,
large retailers, and small businesses, are all trying the concept. Groupon can consider
several actions:
• Groupon Nearby may be one answer to this challenge because it is much more
difficult to replicate. “We have always been thinking about how to solve these
fundamental problems of our model. We have known since very early on that some
form of real-time deal optimization is where his had to go” Mason explains.
• Provide incentives for increased use of Groupon (a loyalty program).
Students may offer other ideas for actions that Groupon could undertake to address these
challenges.
Epilogue
When Groupon became a public company, the IPO (initial public offering) priced the
stock at $20 per share, raised $700 million, and valued the company at more than $12 billion.
Since then, the stock price has fluctuated as experts evaluated the business model and watched to
see if its competitive advantage would erode. Some research suggested that merchants were
reducing the number of deals they were offering through Groupon, resulting in a declining
growth rate for the company. The poor performance led Groupon to fire its founder and CEO,
Andrew Mason, in 2013. In a now widely read memo to Groupon employees, Mason wrote
“I’ve decided to spend more time with my family. Just kidding, I was fired today. If you are
wondering why, you haven’t been paying attention.” In the past year, the stock price has ranged
from $3.70 to $12.70.
To help improve the growth of the company, Groupon is constantly trying new features
and marketing programs. For example, Groupon recently introduced Clicky, a clickable value
wheel that allows consumers to sign in with their Facebook login and “spin” the wheel for a
chance to win a discount on selected Groupons. The purpose of Clicky is to increase the number
of active Groupon users by providing a social media tool that has an entertainment component.
Groupon also purchased Ticket Monster to improve its ability to provide long-term offers. It
also eliminated its requirement to register before shopping to make the Groupon experience more
convenient.
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The changes seem to be working. Groupon recently reported that the four days including
Black Friday and Cyber Monday was its biggest four-day weekend of sales since its inception.
According to new CEO Eric Lefkofsky, “With our redesigned website and mobile apps with
integrated search, it’s easier than ever to explore our marketplace. And with more than 50% of
our transactions coming from mobile, we’ve become a necessity this holiday season for
customers when they want to buy just about anything, anytime, anywhere.” So what was one of
the most popular products sold on Groupon? It sold more than 15,000 Keurig Brewing systems
in just those four days!
Sources: “Groupon’s Holiday Weekend Delivers Record Sales,” Business Wire, December 3, 2013; Barbara Ortutay,
“Struggling Groupon Ousts CEO Andrew Mason,” The Associated Press, March 1, 2013; “Is the Brave New
Groupon Strategy Showing Promise?” Wall St. Cheat Sheet, November 10, 2013; “Groupon Introduces Clicky, the
Clickable Value-Wheel as Promotional Marketing Tool,” Internet Business News, January 10, 2012; Alistair Barr,
“Groupon Shares Fall as Merchants Back Off,” The Gazette, January 4, 2012, p. B6; Evelyn M. Rusli, “Groupon’s
Underwriters Are Cautious on Stock,” The New York Times, December 15, 2011, p. 8; and Evylyn M. Rusli, “A
Good Day for Groupon and Internet Start-ups,” The New York Times, November 5, 2011, p. 1.
5-39
TEACHING NOTE FOR APPENDIX D CASE D-5

DECODING A PURCHASE DECISION
Synopsis:
When and how does a buying decision actually get made? This case describes the series
of events preceding the purchase of an espresso machine by Brock and Alisha Jamison. The
description follows the couple from the summer of 2014 when they first saw an espresso
machine to January 29, 2016, when Brock and Alisha purchased their own espresso machine. A
student’s task in analyzing this case is to diagnose the purchase decision process. By doing this,
a student will hopefully come to understand and apply the behavioral concepts discussed in
Chapter 5.
Teaching Suggestions:
This case is suited for use after Chapter 5 has been discussed. In teaching this case,
instructors should try to illustrate and expand on the behavioral concepts affecting a buying
decision that is brought out in the chapter.
Answers to Questions:
1. Which of the Jamisons decided to buy an espresso machine? The Krups brand?
Answer:
Most students will remark on the joint nature of the decision processes for both the
product and the brand. A significant minority, however, will focus on Alisha’s role in
the decision process, specifically her thought of exchanging the gift of a KitchenAid
mixer for an espresso machine. There is some support, therefore, for a spouse-
dominated decision at that point.
2. When was the decision to buy made?
Answer:
a. This question is purposely vague on what constitutes a “decision.” At least six
reasonable decision points could be raised. They are:
i. Upon receipt of the KitchenAid mixer as a gift;
ii. When the unopened mixer was taken from Michigan to Los Angeles with
the exchange strategy in mind;
iii. At the time of the first Cuisine á Domicile visit, which was the first overt
action toward purchase;
iv. During the telephone call to Dora Mayeur;
5-40
v. At the early part of the Cuisine á Domicile visit with Dora Mayeur (before
the exchange could not be made); and
vi. After the exchange was made.
b. Students are usually quick to point out that the decision to make a purchase
“sometime” was made upon receipt of the gift; but that the decision to transact at
a particular time was made only after exchange of the blender was assured. This
event points out the importance of situational factors in buyer behavior.
3. What were the important attributes in the evaluation of the Krups brand?
Answer:
Students typically recognize that the important attributes were elegance and
usefulness (particularly versus the mixer) and price. However, other attributes appear
to be the evaluation of the Krups brand by the rating services, and size.
4. Would you characterize the Jamisons’ purchase decision process as routine

problem solving, limited problem solving, or extended problem solving? Why?
Answers:
a. Students typically note that limiting problem solving was evident. However,
some students might argue that extended problem solving occurred.
b. Whatever problem solving variation is chosen, the instructor should ask students
to describe the purchase decision process. One such description given by a
student is shown below.
Stage Explanation
Problem Definition The Jamisons recognized a problem in the summer of 2014
when they witnessed what an espresso machine could do.
Information Search It appears that all four sources of external information were
present. Personal sources evidenced by their friend Brad’s
recommendation started the purchase decision. Public
sources including Bon Appétit magazine and Consumer
Reports were examined. Marketer dominated sources
evidenced by Dora Mayeur at Cuisine á Domicile played a
major role. Finally, Brock and Alisha had actually
experienced the result of an espresso machine and
particularly the Krups brand.
Alternative Evaluation There did not appear to be a formal, overt evaluation of
alternatives. However, the rating services, which gave the
There did not appear to Krups brand a high rating, allowed the Jamisons to compare
be a formal, overt evaluation of alternatives. In addition, Dora providec a review of
Nespresson, FrancisFrancis, and Jura brands.
alternatives. However,
the rating services, which gave
5-41
the Krups brand a high

rating, allowed the Jamisons to
compare alternatives.
In addition, Dora provided a
Purchase Decision The purchase decision as regards a specific date is unclear
(see 2a above). However, the opportunity to exchange the
mixer clinched the decision. This situational influence
probably was the critical factor.
Post-Purchase Behavior It appears that the Jamisons were satisfied with their
decision.
5-42
ICA 5-1: IN-CLASS ACTIVITY
Buying Process for Starbucks VIA™ Refreshers Instant Coffee1
Learning Objectives. To illustrate the consumer purchase decision process for coffee.
Nature of the Activity. To relate the consumer buying process to purchasing a cup of
Starbucks coffee.
Estimated Class Time and Teaching Suggestions. This ICA runs about 20 minutes,
taught in class in 4-person teams.
Materials Needed.
• Instructors may want to purchase the Starbucks VIA™ Refreshers Instant Coffee at
a local Starbucks store or grocery store (where available) for about $10 for a bag
of 12 packets.
• Instructors may want to “brew” several of the Starbucks VIA™ Refreshers Instant
Coffee to bring to class (if permissible) to have students taste this product.
Steps to Teach this ICA.
1. OPTIONAL: Bookmark the following websites on your classroom computer:
• The Starbucks VIA™ Refreshers Instant Coffee website

(www.starbucks.com/coffee/via).
• The YouTube Starbucks VIA™ Refreshers Instant Coffee video clip
(www.youtube.com/watch?v=7KoN2v4yFAY). [TRT = 1:28]
2. Form students into 4-person teams.
3. Show Slide 5-47. Click on the “Website” Internet icon for Starbucks VIA™
Refreshers Instant Coffee and/or click on the “Video” Internet icon [TRT = 1:28] to
play a YouTube video clip about the Starbucks VIA™ Refreshers Instant Coffee.
4. Give the following mini-lecture about Starbucks:
“The Starbucks Coffee Company is the leading retailer, roaster, and brand of
specialty coffee in the world. During its 2013 fiscal year, Starbucks had sales of
$14.9 billion. Moreover, by the end of fiscal 2013, it had almost 20,000 company-
owned and franchised stores in over 55 countries within North America, Latin
America, Europe, the Pacific Rim, and the Middle East.
1
The authors wish to thank Maggie Jantzen, Corporate Communications of Starbucks, who assisted in the development of this ICA.
5-43
Coffee is a commodity. People can buy a cup of coffee almost anywhere in the world
or make it themselves. With most commodities, firms cannot charge a premium
price. However, Starbucks does charge a higher price for a cup of coffee because it
has created and delivered a brand promise to serve only the finest coffee. Further,
Starbucks is known for its corporate responsibility, including paying coffee farmers
premium prices for their coffee and developing environmental and other programs for
the sustainability and success of these farmers. Starbucks ‘Shared Planet™’ is a
model of how to do business in the coffee market.
Until 2009, Starbucks only offered fresh brewed regular and decaffeinated coffees
(and noncoffee products such as teas, smoothies, etc.) in its stores and retailer
partners’ locations. To expand sales, Starbucks began to target the $22 billion global
instant coffee market. While popular in the U.S., instant coffee has a larger share of
coffee sales in the U.K. (80% share), Japan (53% share), and other countries. As a
result, on September 29, 2009, Starbucks introduced its VIA™ Ready Brew Instant
Coffee in North America. The instant coffee was launched in other countries in 2010.
Interestingly, Starbucks only sells its VIA™ Ready Brew Instant Coffee in packages
ranging from six ($6.95) to 50 servings ($35.95)—it does NOT sell the instant coffee
in its signature short (hot drinks only), tall, grande, and venti sizes. Starbucks VIA is
made using a patent-pending microgrind technology that is designed to produce a
taste almost identical to its freshly brewed coffees. In fact, during its launch,
Starbucks conducted several “taste tests” in selected locations in the U.S. and Canada.
According to Starbucks founder, chairman, and CEO Howard Schultz, it took the firm
20 years to develop the technology. Starbucks VIA™ Ready Brew Instant Coffee is
available in Columbia and Italian Roast, as well as many specialty season flavors
such as Pumpkin Spice and Christmas Blend. Starbucks initially sold its VIA™
Ready Brew Instant Coffee through selected partners (Target, Marriott),
Amazon.com, and online at www.starbucks.com/coffee/via.
Within the first 10 months of its launch, Starbucks VIA™ Ready Brew Instant Coffee
reached $100 million in global sales within the $300 million single serve coffee
category! Starbucks VIA™ Ready Brew Instant Coffee customers consume the drink
in the following manner: 55% drink it at home; 25% at work; and 20% ‘on-the-go.’
At this point in its history, Starbucks VIA™ Ready Brew Instant Coffee is now
available in 37,000 ‘points of distribution,’ which includes grocery, drug, mass
merchandiser (Target, etc.), and Starbuck’s own stores.
In June 2010, Starbucks added a new product to its portfolio: the Starbucks VIA™
Ready Brew Iced Coffee. The offering combines the Ready Brew Instant Coffee with
a bit of pure cane sugar that when mixed with ice cold water provides consumers a
refreshing cup of coffee. Starbucks VIA™ Ready Brew Iced Coffee is available in the
U.S. in an 8-pack for $7.99.” And as of March 2011, Starbucks announced that VIA
Ready Brew had reached $200 million in sales with its dozen products in its line.2
2
“Starbucks VIA™ Ready Brew Hits $100 Million Sales Mark in First 10 Months,” Starbucks news release, August 3, 2010, “Fact Sheet:
Starbucks VIA™ Ready Brew Iced Coffee, “VIA™ Ready Brew Instant Coffee Now Available in Grocery Aisles; Total Availability Increasing
to 37,000 Locations in the U.S. by End of June,” May 20, 2010; and “Starbucks VIA® Ready Brew House Blend and Breakfast Blend Hit
Grocery Shelves in the U.S.,” October 12, 2011.
5-44
In July 2012, Starbucks launched Starbucks Refreshers™ beverages that are made
with green coffee extract and fresh fruit “for a boost of natural energy” to attempt an
entry in the $8 billion energy drink market. Starbucks Refreshers™ are sold in stores
($2.75 for a Tall cup, $3.25 Grande, $3.75 Venti and $4.25 for the Trenta) and as an
instant Starbucks VIA Refreshers™ in: Cool Lime, Valencia Orange, Very Berry
Hibiscus, and Strawberry Lemonade. The latter are sold in 6-packet 16 oz. servings
for $5.99 in stores and online. Starbucks Refreshers™ beverages are also sold in cans
for $1.99 in retail stores.”3
5. Have the student teams write down their ideas on the purchase decision process they
use to buy a cup of coffee and then rank the top three factors.
6. Ask 2 or 3 student teams share their ideas regarding the factors they use during the
purchase decision process to buy a cup of coffee. Discuss these with the entire class.
7. Show Slide 5-47, which is Figure 5-1: Purchase Decision Process. Call on one or
two student teams to answer each of the following questions about the purchase
decision process for a cup of coffee:
• Question 1: What triggers the decision to buy a cup of coffee? Is it a need?

A want?
Answer: Thirsty, saw an ad, part of a routine, etc.
• Question 2: How do you seek information about the purchase of a cup of

coffee, knowing that coffee is a commodity?
Answer: Use past experiences recalled from memory (internal search; ask family
and friends or ads or store signage (external search).
• Question 3: What evaluative criteria do you use when deciding to purchase a

particular coffee brand?
Answer: Taste, price, location, convenience, atmospherics (comfortable), service,
etc.
• Question 4: What is your consideration set of coffee brands?

Answer: Make at home: Folgers, etc. Buy at retailer: Starbucks, Caribou Coffee,
etc.
• Question 5: When and where do you buy a cup of coffee?

Answer: Multiple responses and use situations possible.
3
Bruce Horovitz, “Starbucks’ New Refreshers Energy Drinks Get Mixed Reviews,” USA Today, July 17, 2012; see
http://www.usatoday.com/money/industries/food/story/2012-07-17/starbucks-refreshers-taste-test/56263484/1 and “Fact Sheet: Starbucks
Refreshers™ Beverage Launch Handcrafted, Starbucks VIA™ Ready Brew and Ready-to-Drink Varieties,” Starbucks news release, July 10,
2012; see http://news.starbucks.com/article_display.cfm?article_id=675.
5-45
• Question 6: With respect to the purchase of your last cup of coffee, did you
experience any cognitive dissonance? If dissatisfied, what was deficient? Did
you tell anyone? Will you go back? What marketing activities could be
undertaken to reduce this?
Answer: Marketers have several options regarding the kinds of activities they can
do, such as redesigning the product, reworking the advertising message or
retraining salespeople if the product is being oversold, improving customer
service, offering refunds, etc.
• Question 7: Do any of you drink instant coffee? How does it compare to

fresh brewed coffee? What do you think of Starbucks’ VIA™ Ready Brew
Instant Coffee? What, if any changes in your purchase decision process
would this product cause? Would you be willing to pay $2.95 for a 3-pack?
Why or why not?
Answer: Student responses will vary.
Marketing Lesson. Marketers must understand each step in the consumer purchase
decision process as it applies to their products or services. By doing so, they can develop better
marketing programs with which to target their customers more effectively.
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Chapter 05 - Understanding Consumer Behavior

Solution Manual for Marketing 13th Edition Kerin and

Download full test bank at:

LEARNING OBJECTIVES (LO) ......................................................................................... 5-3

KEY TERMS........................................................................................................................... 5-3

APPLYING MARKETING KNOWLEDGE ...................................................................... 5-30

BUILDING YOUR MARKETING PLAN .......................................................................... 5-32

VIDEO CASE (VC)

APPENDIX D CASE (D)

• D-5: Decoding a Purchase Decision ............................................................................ 5-38

IN-CLASS ACTIVITY (ICA)

POWERPOINT RESOURCES TO USE WITH LECTURES

Selected Textbook Images (Ads, People, Products, and Websites)

Marketing Matters, Making Responsible Decisions, and Marketing Insights

In-Class Activity (ICA)

LEARNING OBJECTIVES (LO)

After reading this chapter students should be able to:

LO 5-1: Describe the stages in the consumer purchase decision process.

LO 5-3: Identify the major psychological influences on consumer behavior.

LO 5-4: Identify the major sociocultural influences on consumer behavior.

ENLIGHTENED CARMAKERS KNOW WHAT CUSTOM(H)ERS AND

a. Influence 80 percent of new-car buying decisions.

b. Are designers, engineers, and marketing executives.

a. The sense of styling.

b. The need for speed.

c. The substance of safety.

d. The shopping experience.

• The behavioral sciences answer questions such as:

I. CONSUMER PURCHASE DECISION PROCESS

• Problem recognition perceives a difference between a person’s ideal and actual

• In marketing, advertisements or salespeople:

a. Can activate a consumer’s decision process by…

b. Showing the shortcomings of competing or currently owned products.

B. Information Search: Seeking Value

After recognizing a problem, a consumer begins to search for information about

a. Involves scanning one’s memory for previous experiences with products or

b. Is often sufficient for frequently purchased products.

a. May be necessary when past experience or knowledge is insufficient.

b. The risk of making a wrong decision is high.

c. The cost of gathering information is low.

• The primary sources of external information are:

a. Suggesting criteria to use for the purchase.

b. Providing brand names that might meet the criteria.

c. Developing consumer value perceptions.

b. Often mentioned or displayed in advertisements.

• Consumers often have several criteria for evaluating brands.

a. This establishes the consideration set—the group of brands that a consumer

b. Consumers can change their evaluative criteria to create a different

c. Example: Figure 5-2.

D. Purchase Decision: Buying Value

a. From whom to buy is determined by an evaluation of:

b. When to buy is determined by:

• The Internet allows consumers to:

c. Make buying decisions.

• Example: 45 percent of consumers with price comparison smartphone apps:

a. Routinely compare prices for identical products across different sellers…

b. At the point of purchase prior to making a purchase decision.

E. Postpurchase Behavior: Realizing Value

• After buying a product, the consumer: