26/01/2024

MKT301E Lecture 4
Consumer Markets and Consumer behavior

Principles of Marketing

Contact

- Dr Tran Thu Trang: thutrang@ftu.edu.vn

Lecture Agenda
What is Consumer market?
What is Consumer Behaviour?
Consumer Decision Making Process
Involvement
Factors affecting consumer decisions
Building a persona

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Where would you find Consumer Behaviour

on our Marketing Process flowchart?

Part 1 - The “final consumer” market:

“…individuals and households who buy or

acquire goods and services for personal
consumption.” (Kotler, et al. 2009: 162)
Most marketers undertake consumer
research to try to learn more about 5W1H:
what consumers buy, who buys, how they
buy, when they buy, where they buy and,
most importantly, why they buy.

Part 2 - What is Consumer Behaviour?

Consumer buyer behaviour is the buying

behavior of final consumers—individuals
and households that buy goods and
services for personal consumption.

“The processes involved when individuals or

groups select, purchase, use, or dispose of
products, services, ideas, or experiences to
satisfy needs and desires” [Solomon, 2013]
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Consumer behaviour
Processes a consumer uses to make purchase
decisions, as well as to use and dispose of
purchased goods and services
Includes factors that influence purchase decisions and
the use of products
Marketers may attempt to use different promotional
techniques to influence consumers decisions

Consumer Stimulus-Response
Model

The central question of Consumer Behaviour is:

“What’s in the box?”https://www.youtube.com/watch?v=9zKfF40jeCA dove onslaught

Part 3 - Consumer Decision-Making Process

CDMP

The step-by-step process used by

consumers when buying
goods or services

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Consumer Decision-Making Process

The model tries to capture the journey of consumers from awareness to

post-purchase

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Stage 1 - Need Recognition

Occurs when a consumer is faced with an
imbalance between actual and desired
states
Need can be triggered by internal or
external stimuli
A want exists when the need manifests
into desire for a product to resolve the
imbalance

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Stimulus

Any unit of input affecting one or more of

the five senses: sight, smell, taste, touch
or hearing

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Need recognition triggers

Internal & External stimuli
Consumer behaviourists try to:
– understand the circumstances that trigger
the need
– communicate this trigger to the consumer
by getting the consumer to recognise this
imbalance, and buy their product to satisfy
the need.
Example: why do beverage companies advertise
heavily in January-February?

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5 Psychological Triggers That Drive Consumer Behavior

It’s no secret that incorporating the principles of psychology into sales pitches and
direct marketing pieces is one of the smartest and most effective way to improve
business results.

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Transforming needs into wants

• Consumers recognise unfulfilled needs by
• Dissatisfaction with performance of existing
product; computer crashes/glitches.
• Run out of something generally kept on hand
• Changed circumstances, such as having a baby
• Product acquisition – bought a camera now need a
lens, razor > blades, new sport > need equipment.
• Learn about a superior product/feature; iPhone 15
Pro Max

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Transforming needs into wants

• Marketers:
• Investigate latent/unrealised needs
• Trigger the unrealized needs and guide them into desiring a solution
that the marketers offer.

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Stage 2 - Information Search

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

Sources of information (internal vs external):

– Experiential sources (personal experience)
– Personal sources(e.g. family/friends)
– Commercial sources (marketing-driven-advertising,
company web-site, sales person)
– Public sources(e.g. consumer report, magazine, blog,
internet)
Generally, the higher the risk, the greater the
search >> Goal is to reduce uncertainty
What are the types or risks consumer face? (hint: think
about the sources of value)

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LO2

Information sources
Non-marketing Marketing
controlled controlled
Not associated with Originates with
advertising or marketers promoting
promotion. the product.
Includes personal Consumers are often
experience, personal wary about information
sources and public received from this
sources such as source.
consumer reports like
Choice magazine.

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Stage 3 - Evaluation of Alternatives

Search yields the buyer’s evoked set or consideration set = a
group of brands from which a buyer will choose.

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Stage 3 - Evaluation of Alternatives

• No single process is used by consumers to choose among

alternative brands
• Evaluation involves the development of a set of criteria
• Help the consumer consider and compare alternatives
• Some are objective (facts), others subjective (emotions).
• To decide upon their evoked set, consumers
will use
both objective (facts) and subjective
(emotions) evaluation criteria

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Stage 3 - Evaluation of Alternatives

• Consumers narrow their • Marketers try to determine

choice of brands by
evaluating brands according
to attributes that are
important to them, e.g. a
good camera on a phone.
Then they will select brands
that have that attribute.
• Marketers will communicate
to consumers which
important attribute(s) their
brand excels at
which attributes are
most important
• Marketers often make the
mistake of making
assumptions about what the
consumer thinks is most
important – hence the
importance of marketing
research.

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Stage 3 - Evaluation of Alternatives

• Narrow choices by using cut offs
• Minimum or maximum levels for brands to be considered further
• To narrow choice of phone further, might use price
• E.g. Phone must be under $600
• Further narrow by ranking attributes
• What are most important attributes?
• How do products perform?
• E.g. camera quality and memory
• If a new brand is added to the evoked set, the original brands may be
evaluated differently
• E.g. $350 phone added
• Now phone that was $299 before may seem more desirable

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Stage 3 - Evaluation of Alternatives

Consumers use brands to help

evaluate alternatives
Brands can impact choice
• Used to simplify decision making
process
• Signal trust and quality
• E.g. Might trust a brand based on
experience with it
• E.g. might trust based on type of
people you think use it
• E.g. don’t want to ‘think’ so buy
market leader > e.g. Panadol
• the most trusted brand of
pain reliever

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Stage 3 - Evaluation of Alternatives

• Marketers can influence a

consumer’s evaluations by
framing the alternatives
- Describes the alternatives
and their attributes in a
certain manner
- Make a certain attribute
seem more important to
consumers

• More likely to influence

inexperienced buyers
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Stage 4 - Purchase Decision

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

The purchase intention may not be the

purchase decision. Factors that may distort
the intention to purchase due to:
– Unexpected situational factors (e.g.
supermarket aisle placement and promotions)
– Attitudes of others & Social desirability bias

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Stage 5 - Post-purchase
The stage where consumers take
further action after purchase, based
on their satisfaction or dissatisfaction

Potential for “post-purchase

dissonance” an inner tension over the
perceived appropriateness of a
purchase after his or her decision has
been made
– “Did I get the right thing?”
– Dissonance =/= regret!

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Stage 5 Post-purchase behaviour:

cognitive dissonance
Marketing can minimise dissonance through effective
communication with purchasers.
Consumers seek to reduce dissonance by justifying their
purchase decision and may:
seek information that reinforces positive ideas about
the purchase
deliberately seek contrary information so as to refute it
change their attitudes to conform to the decision.
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Consumer roles in the buying

process

person who first

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

Key
who Decision Influencer
makes Buyer Roles
actual
purchase, whose view carries
e.g. father weight in buying
decision, e.g. teenager
interested in technology
ultimately makes
buying decision,
Decider
e.g. mother

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Who is the Decider?

A Vietnamese student wants to continue his education
abroad.
His girlfriend has secured a spot at a prestigious university
in the US, so he wants to go there. But, his mom doesn't
want him to be so far away so she orders the son to study
in Singapore instead.
His father will pay for it, and he takes the student to the
education agency, who advised the family about what
options are available in Singapore.
In this scenario, the Decider is the...

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Part 4 - Involvement

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Involvement – the implications

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

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Factors determining the level of

consumer involvement

Previous experience Interest

Perceived risk
Situation of negative
consequences

Social visibility

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Factors that influence perceived risk

Decision-
Consumer
making
knowledge
confidence

Product Level of
experience interest

Perceived risk influence the information search. The higher the risk > the
higher the Involvement > the greater the Information Search effort.
The Information Search yields an evoked set (consideration set).

A group of brands resulting from an information

search, from which a buyer can choose

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Consumer buying decisions

and consumer involvement
Someone who is thinking of buying a home will spend
a lot of time searching for the right building in the right
location, as the financial risk is high.

Getty Images/Brendon Thorne/Bloomberg

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Continuum of consumer buying decisions

Likely to skip or Likely to go

skim Information through all 5
Search and Stages
Evaluation

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Strategies:
High involvement
– Should provide sufficient info
– Personal selling to answer questions
– Use comparative advertising
– Provide intensive help/chat line
– Simplify product benefits

Low involvement
– Avoid stock out
– Maintain product quality
– Free samples to encourage trial that breaks brand habit
– Develop ‘flashy’ ads that evoke desire/curiosity
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Part 5 - Factors influencing

Consumer Behaviour

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Need Social
Cultural
recognition • groups
• culture • social network
• sub-culture • family and
• social class household
• roles and status
Info search

Evaluation of
alternative

Personal
• age Psychological
• life-cycle Purchase
• motivation
• occupation • perception
• economic situation • learning
• life-style • beliefs and
• personality Post-purchase attitude
• self-concept Behaviour

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1. Cultural factors
Culture is the set of basic values, perceptions,
behaviours learned by a member of society from
family and other important institutions.
Subcultures are groups of people within a culture
with shared value systems based on common life
experiences and situations
Social classes are society’s relatively
permanent and ordered divisions whose
members share similar values, interests, and
behaviours (measured as a combination of
occupation, income, education, wealth, and other
variables)
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Cultural factors
Culture components = Language,
myths, customs, values.
Subcultures = a group of people sharing
the same cultural components.
– E.g., High regard towards animals (cultural
component) -> Vegans (subculture)

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2. Social Factors
Groups/ Reference Groups
Membership Aspirational
Groups Groups
• Groups with • Groups an
direct influence individual
and to which a wishes to
person belongs belong to
E.g., – Samsung attempts to make iPhone users a dissociative group
https://youtu.be/tNxDd3l0lEU?t=24s https://www.youtube.com/watch?v=e9S4v5-BC58

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Aspirational groups are groups of

people to whom we want to
belong.

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Family and Household

Family is the most important
consumer-buying
organization in society.
Roles and Status
Role and status can be
defined by a person’s
position in a group.
A person belongs to many
groups—family, clubs,
organizations, and online
communities. The person’s
position in each group can be
defined in terms of both role
and status.

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3. Personal Factors
Age and life-cycle • People change the goods and services they buy
over their lifetimes
stage
• A person’s occupation affects the goods and
Occupation services bought

Economic • A person’s economic situation will affect their

product choice
situation
• People coming from the same subculture,
Lifestyle social class and occupation may live quite
different lifestyles

• Brand personality is the specific mix of human

Personality traits that are attributed to a particular brand

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Life Cycle stages

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

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4. Psychological
Motivation

Perception

Learning

Beliefs and attitudes

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Motivation
A motive (or drive)
is a need that is
sufficiently pressing
to direct the person
to seek satisfaction of
the need.
Motivation is the
energizing force that
stimulates behavior
to satisfy needs. 16

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Perception
Perception is the process by which people
select, organize, and interpret information
to form a meaningful picture of the world

Selective Selective Selective

attention distortion retention

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Selective attention is the tendency for

people to screen out most of the information
to which they are exposed.
Selective retention consumers do not
remember all the information they see, read
or hear, even minutes after exposure to it.
Selective distortion is the tendency for
people to interpret information in a way that
will support what they already believe.

https://www.youtube.com/wat
ch?v=W_IzYUJANfk Coachella

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Learning

Learning is the change in an individual’s

behavior arising from experience and
occurs through the interplay of:

Drives Stimuli Cues Responses

Reinforcement

These are
examples of
teaching and
https://www.youtube.com/watch?v=lqT_dPApj9U
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TBBT: https://www.youtube.com/watch?v=bDZCyObMfkA
learning

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Beliefs and Attitudes

A belief is a descriptive thought that a person has
about something based on:
– knowledge
– opinion
– Faith
Beliefs are based on personal experience,
advertising and discussion with other people.
An attitude describes a person’s relatively
consistent evaluations, feelings, and tendencies
toward an object or idea. Attitudes are shaped by
values, beliefs which are learned

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Part 6. Integrating Consumer

Behaviour into a basic persona
Buyer Personas (Consumer Avatars) are
fictionalized, general representations of a
group of people who share common
needs, traits or values.
Creating idealized groupings of customer
profiles helps marketers think about how
to best tailor their offering to appeal to
them

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