Consumer Behaviour

Session 1 Introduction to Consumer Behaviour

Katrin Horn

Learning Outcomes

Understanding the role of consumer behaviour and marketing Identify the role of consumer behaviour research in strategic decision making Discuss the relationship between consumer behaviour and marketing decisions Describe the wide variety of applications for marketing research Identify various career opportunities in marketing and consumer behaviour research

Marketing and Consumer Behaviour

Historical overview: challenges to the marketing function 1970s
Growing power of retailers

1980s
Internationalisation / globalisation of competition

1990s
Environmental consciousness & social responsibility

2000s
Fragmented structures of consumption & new communication technologies

Different Foci of Marketing 1) Production Orientation 2) Product Orientation 3) Sales Orientation 4) Market Orientation

Marketing Strategy and Consumer Behaviour

Understanding consumer behaviour as conditio sine qua non

Increasing number of companies embrace marketing concept Customer needs in the center Increased insecurity High failure rate

Consumer orientation becomes vital

Why? Changing environment and fragmentation Global consumers, global brands, global retailers Marketing research at the centre of overall strategy

What for? Alternative route generation Decision support Tailoring the marketing mix

Difficulty: Information literacy

Marketing Opportunities and Constraints

Typical Questions in Consumer Behaviour Research How satisfied are consumers with current offerings on the market ? Are there any unmet consumer needs ? How is our offering likely to be perceived by consumers relative to competitors offerings ? What new product/product features will help us to maintain our competitiveness? How can we develop an effective marketing mix? Product Price Place Promotion Can we evaluate the effectiveness of our marketing plans? Who uses the product? How is our product used? How about the consumer decision process?

Career Opportunities
Vast array of job opportunities ranging from titles such as: Data Entry Clerk; Tabulation Specialist; Programmer Interviewer (telephone or field) Research Analyst Marketing Research Manager/Director Possible responsibilities Gathering data from markets Conducting customer surveys Conducting observations Conducting Experiments Determining the needs of customers Evaluating customer response to advertising Testing products in the market place Data Mining

Consumer Behaviour Defined

Consumer behavior reflects the totality of consumers decisions with respect to the acquisition, consumption, and disposition of goods, services, time, and ideas by (human) decision making [over time].
What Affects Consumer Behavior? Psychological Core (Internal Processes) Decision Making Process Consumers Culture (External Processes) Consumer Behavior Outcomes Who Benefits from the Study of Consumer Behavior? Marketing Managers Ethicists and Advocacy Groups Public Policy Makers and Regulators Consumers

Consumer Behaviour Defined

Model of Consumer Behaviour

Principles & Application

Psychological Core
Having motivation, ability, and opportunity Exposure, attention, and perception Categorizing and comprehending information Forming and changing attitudes Forming and retrieving memories

Consumers Culture
External Processes: Regional and Ethnic Influences Age, Gender, and Household Influences Reference Groups

Consumer Behavior Outcomes Process of Making Decisions

Problem Recognition and Search for Information Making Judgments and Decisions Making Post-Decision Evaluations Consumer Behaviors Can Symbolize Who We Are Consumer Behaviors Can Diffuse Throughout a Market

External Influences
Consumer decisions happen within external contexts Individual consumer decisions are influenced by The situation

The culture

Climate Sense of space Sense of time Religion Communication Aesthetics

Membership groups

Other individuals/groups

Reference groupsAspirant groups Dissociative groups Opinion leaders Family

Consumption as a process
Problem recognition occurs whenever consumers see a significant difference between current state of affairs and some desired ideal state. Information search consumers survey their environment for appropriate data to make a reasonable decision. Evaluation of alternatives where alternatives are identified, categorised, and compared against evaluative criteria. Product choice against noncompensatory or compensatory decision rules. Outcomes does product satisfy consumers needs and wants.

Problem Recognition

Information Search

Evaluation of Alternatives

Product Choice

Outcomes

A different view on Consumers: Role Play

Consumers as actors on a stage - Playing different roles all the time - Engaging in a play with other actors - Using props to sent out messages - Retail environments as a stage

Consumption activities and meanings

As experience when consumption is a personal, emotional, or aesthetic goal in itself. As integration using and manipulating consumption objects to express aspects of oneself. As classification to communicate association with objects, both to self and others. As play to participate in a mutual experience and merge identities with that of a group.

Wider issues: Consumer Society and Consumerism

Society defines itself through consumption, individual define themselves through consumption, hyper-consumption Consumption as the transfer of meaning. Globalisation. Consequences? Sweatshops Debt Stress Loss/Decline of other identificational systems

Counter-reactions

Summary
The term consumer behaviour is usually conceived rather narrowly. More than the acquisition of products/services it comprises: the understanding of the set of decisions What How Whether Where Why How much When How often made about an acquisition, use, or disposition of Products, Services and Ideas Understanding issues around consumption helps us to critically understand the society we live in Consumer society and the definition of the self

Reading
Revision Solomon, Bamossy, Askegaard and Hogg (2009). Consumer Behaviour (4th Edition). FT Prentice Hall: Chapter 1.

Please read and prepare for next week: Solomon, Bamossy, Askegaard and Hogg (2009). Consumer Behaviour (4th Edition). FT Prentice Hall: Chapter 2.