CHAPTER 2

Understanding Consumer Behavior

LEARNING OUTCOMES

2.1 Consumer buying behaviour

2.2 Factors influencing consumer
buying behaviour
2.3 Consumer buying decision-
making process
2.4 Types of consumer buying
decisions
LO 1 : Consumer buying behaviour

Consumer Behaviour
Processes a consumer uses to make purchase decisions, as well as to
use and dispose of purchased goods or services; also includes factors
that influence purchase decisions and product use.

consumers make
purchase decisions

Consumer
behaviour = HOW

consumers use and

dispose of product

LO 2 : Factors influencing consumer buying

behaviour

Cultural Social
Factors Factors
CONSUMER
BUYING
BEHAVIOUR

Psycho-
Individual logical
Factors Factors
LO 2 : Factors influencing consumer buying
behaviour
Cultural Factors

• Culture is the set of values, norms, attitudes, and other

meaningful symbols that shape human behavior, and the artifacts,
or products, of that behavior as they are transmitted from one
generation to the next.

• The most defining element of a culture is its values—the enduring

beliefs shared by a society that a specific mode of conduct is
personally or socially preferable to another mode of conduct.

LO 2 : Factors influencing consumer buying

behaviour
Social Factors

• Many consumers seek out the opinions of others to reduce their

search and evaluation effort or uncertainty, especially as the
perceived risk of the decision increases.

• Specifically, consumers interact socially with reference groups,

opinion leaders, and family members to obtain product
information and decision approval.
LO 2 : Factors influencing consumer buying
behaviour
Social Factors

• Reference group is a group in society that influences an

individual’s purchasing behavior. Consumers learn from observing
how members of their reference groups consume, and they use
the same criteria to make their own consumer decisions.

• Opinion leader is an individual who influences the opinions of

others. Companies sometimes use movie stars, sports figures, and
other celebrities to promote products, hoping they are
appropriate opinion leaders.

LO 2 : Factors influencing consumer buying

behaviour
Social Factors

• Family members is the family is the most important social

institution for many consumers, strongly influencing values,
attitudes, self-concept—and buying behavior. Decision-making
roles among family members tend to vary significantly, depending
on the type of item purchased.
LO 2 : Factors influencing consumer buying
behaviour
Individual Factors

A person’s buying decisions are also influenced by personal characteristics that

are unique to each individual, such as gender, age, life-cycle stage and also
includes personality, self-concept, and lifestyle.

• Personality is a way of organizing and grouping the consistencies of an

individual’s reactions to situations.

• Self-concept is how consumers perceive themselves in terms of attitudes,

perceptions, beliefs, and self-evaluations.

• Lifestyle is a mode of living as identified by a person’s activities, interests, and

opinions

LO 2 : Factors influencing consumer buying

behaviour
Psychological Factors

An individual’s buying decisions are further influenced by psychological factors:

perception, motivation and learning. These factors are what consumers use to
interact with their world.

• Perception is the process by which people select, organize, and interpret

stimuli into a meaningful and coherent picture.

• Motivation is the driving force that causes a person to take action to satisfy
specific needs.

• Learning is a process that creates changes in behavior, immediate or expected,

through experience and practice.
LO 3 : Consumer buying decision-making
process
When buying products, particularly new or expensive items, consumers generally
follow the consumer decision-making process as shown below. These five steps
represent a general process that can be used as a guide for studying how
consumers make decisions.
Need Recognition

Cultural, Information Search

Social,
Individual and Evaluation
Psychological of Alternatives
factors would
affect all steps Purchase

Postpurchase
Behavior

LO 3 : Consumer buying decision-making

process
STEP 1 : Need Recognition
Need recognition occurs when consumers are faced with an imbalance between actual and
desired states that arouses and activates the consumer decision-making process. Need
recognition is triggered when a consumer is exposed to either an internal or an external stimulus.

• Stimulus is any unit of input affecting one or more of the five (5) senses: sight, smell, taste,
touch, hearing.

• Internal stimuli are occurrences you experience, such as hunger or thirst. is a way of
organizing and grouping the consistencies of an individual’s reactions to situations.

• External stimuli are influences from an outside source such as someone’s

recommendation of a new restaurant, the color of an automobile, the design of a
package, a brand name mentioned by a friend, or an advertisement on television or
radio.
LO 3 : Consumer buying decision-making
process
STEP 2 : Information Search

An information search can occur internally, externally, or both.

• Internal information search is the process of recalling past

information stored in the memory.

• External information search is the process of seeking information

in the outside environment.

LO 3 : Consumer buying decision-making

process
STEP 3 : Evaluation of Alternatives
mengecilkan

• One way to begin narrowing the number of choices in the evoked

set is to pick a product attribute and then exclude all products in
the set that don’t have that attribute.

• Another way to narrow the number of choices is to use cutoffs.

Cutoffs are either minimum or maximum levels of an attribute
that an alternative must pass to be considered.
LO 3 : Consumer buying decision-making
process
STEP 4 : Purchase
4W1H

To Buy or Not to Buy ultimately, the consumer has to decide whether

to buy or not buy. Specifically, consumers must decide:

✔ Whether to buy
✔ When to buy
✔ What to buy (product type and brand)
✔ Where to buy (type of retailer, specific retailer, online or in-store)
✔ How to pay

LO 3 : Consumer buying decision-making

process
STEP 5 : Postpurchase
(tingkah laku selepas pembelian)
behaviour
When buying products, consumers expect
certain outcomes from the purchase. How
well these expectations are met
determines whether the consumer is
satisfied or dissatisfied with the purchase.

When consumer recognize inconsistency

between their values or opinions and their
behavior, they tend to feel an inner tension
called cognitive dissonance.
LO 4 : Types of consumer buying decisions

Routine Limited Extensive

Response Decision Decision
Behavior Making Making

LO 4 : Types of consumer buying decisions

Routine response behavior
The type of decision making exhibited by consumers buying frequently
purchased, low-cost goods and services; requires little search and decision time.

Limited decision making

The type of decision making that requires a moderate amount of time for
gathering information and deliberating about an unfamiliar brand in a familiar
product category.

Extensive decision making

The most complex type of consumer decision making, used when buying an
unfamiliar, expensive product or an infrequently bought item; requires use of
several criteria for evaluating options and much time for seeking information.