Analyzing Consumer

Markets
Motivation
Maslow’s Herzberg’s
Freud’s Hierarchy Two-Factor
Theory of Needs Theory

Behavior Behavior Behavior is

is guided by is driven by guided by
subconscious lowest, motivation
motivations unmet needs and hygiene
factors
Sigmund Freud’s theory of motivation

Private Social Consumption

Consumption Conspicuous Consumption
Maslow’s hierarchy
Herzberg’s Two factor theory

Motivate consumers
to buy: Points of
Difference

Consumers remain
unmotivated to buy if
these are not present:
Points of Parity
 Consumer Behavior

Consumer behavior is the study of

how individuals, groups, and
organizations select, buy, use, and
dispose of goods, services, ideas, or
experiences to satisfy their needs and
wants.

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 What Influences
Consumer Behavior? -Nationalities
-Religions
-Racial groups
Cultural Factors -Geographic regions

-Reference
Groups
-Family Social Factors
-Social Roles
-Statuses
-Age
-Life cycle stage
Personal Factors -Occupation
-Wealth
-Personality
-Values
-Lifestyle
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 Brand Personality
 Sincerity
 Excitement
 Competence
 Sophistication
 Ruggedness

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 Consumer Buying Process

Problem Recognition

Information Sources
Information Search -Personal
-Public
-Commercial
Total Set
Evaluation of alternatives -Experiential
Awareness Set
Consideration Set
Choice Set
Purchase Decision

-Satisfaction/Delight
Postpurchase Behavior
-Dissatisfaction/Cognitive
dissonance

Expected
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 Low vs. High-Involvement Decision Making

 Elaboration Likelihood Model

 Central Route (for high

involvement products)
 Peripheral route- Heuristics

(shortcuts for low involvement

products)

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 Mental Accounting
 Consumers tend to:
 Segregate gains: therefore don’t bundle discounted products

 Integrate losses: Bundle products that have a high price

individually
 Framing: positive, negative

 Can Consumer behavior be initiated/changed? AIDA model

 Nudge Marketing

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 CPV and CLV
 Consumer Perceived Value: The ‘value’ that consumer
perceives he/she derives from the offering. It is a function of:
benefits (utilitarian, hedonic, emotional) – costs (money,
time, risk, search, acquisition)
 Customer Lifetime Value: Firms too look for ‘valuable’
(profitable) customers. CLV is the net present value of: all
future cash flows that the firm will garner from a
customer over his/her lifetime minus the costs (involved
in acquiring the customer, CRM costs and service costs).
 More:
https://www.propellercrm.com/blog/customer-lifetime-value-cl
v
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