Principle Of Marketing
Chapter No: 5
Consumer Markets And Consumer
Buyer Behavior
Assign By: Mam Uzma Naz
Submitted By:
Zunera, Ammara,
Humna, Nida And
Shahneela

OBJECTIVES:
MODEL OF CONSUMER BEHAVIOUR.
CHARACTERISTICS AFFECTING CONSUMER
BEHAVIOUR.
TYPES OF BUYING DECISION BEHAVIOUR.
THE BUYER DECISION PROCESS.
THE BUYER DECISION PROCESS FOR NEW
PRODUCTS.

Model of Consumer Behavior
Consumer buyer behavior:
it is refers to the buying behavior of final consumers
individuals and households who buy goods and services
for personal consumption.
Consumer market:
It is refers to all of the personal consumption of final
consumers.
or
The consumer market pertains to buyers who purchase
goods and services for consumption rather than resale.
However, not all consumers are alike in their tastes,
preferences and buying habits due to different
characteristics that can distinguish
certain consumers from others.

Consumer Buyer Behavior is a "mystery", because consumers vary
greatly in their demographics and individual characteristics. No one
buyer is alike another. However some groups of buyers do act similarly
to each other. In order to study buyer behavior, we have had to
create a model to answer the central question of how consumers will
respond to different marketing efforts and stimuli. It's called...the
"Model of Consumer Buyer Behavior".
[1] Consumers "ingest" marketing and other stimuli
[2] the stimuli enters their "buyer black box"
[3] the "black box" creates buyer responses.

It starts with marketing and other stimuli. When we consider
marketing stimuli, we usually focus on the "4 P's": Product,
Price, Place and Promotion. When we are examining other
stimuli, we usually look at internal and outside economic,
technological, political and cultural factors that influence the
buyer.
All of that stimuli enters what we call the "buyer black box"...
the brain. This "black box" contains all of the characteristics
of the buyer. The buyer characteristics influence how he or
she perceives the marketing stimuli, and creates a
reaction. The "black box" also contains the consumer's
individual decision process, which is used to evaluate whether or
not they will purchase a product.

Finally, this black box creates the "buyer response". This
buyer response influences the choice of product, their
individual brand choice, the choice of dealer, the timing of the
purchase, and the amount of money they will be spent on the
goods and services.

Characteristics Affecting
Consumer Behavior

Cultural factors:
cultural factors exert a board and deep influence on
consumer behavior.
There are three cultural factors as below:
Culture Subculture Social class

• Culture:
culture is the set of values, perception, wants & behavior
learned by a member of society from family.
Cultural factors have a significant effect on an
individual’s buying decision. Every individual has
different sets of habits, beliefs and principles which
he/she develops from his family status and background.
What they see from their childhood becomes their
culture.

• Sub culture:
A group of people with shared value systems based on common
life experience and situation.
Each culture further comprises of various subcultures
such as religion, age, geographical location, gender
(male/female), status etc.
Religion (Christianity, Hindu, Muslim, Sikhism,
Jainism etc.)
Status (Upper Class, Middle class and Lower Class).
Gender (Male/Female).

• Social class:
Social classes are society’s relatively permanent
and ordered divisions whose members share
similar values, interests, and behaviors
Measured by a combination of occupation, income,
education, wealth, and other variables.

Social Factors:
Social factors play an essential role in influencing the buying
decisions of consumers. Such as:
Reference
Groups
Family
Roles And
Status

• Reference Groups:
Every individual has some people around who influence
him/her in any way. Reference groups comprise of people that
individuals compare themselves with.
Reference groups are generally of two types:
1. Primary Group - consists of individuals one interacts
with on a regular basis.
Primary groups include:
Family Members.

2. Secondary Groups - Secondary groups share indirect
relationship with the consumer. These groups are more formal and
individuals do not interact with them on a regular basis.
Example - Religious Associations, Political Parties, Clubs etc.
• Family:
Family plays an important role in influencing the buying
decisions of individuals.
Every individual goes through the following stages and
shows a different buying need in each stage:
Bachelorhood: Purchases Alcohol, Beer, Bike, Mobile
Handsets (Spends Lavishly).

Newly Married: Tend to purchase a new house, car,
household furnishings. (Spends sensibly)
Family with Children: Purchases products to secure his as
well as his family’s future.
Empty nest (Children getting married)/Retirement/Old
Age: Medicines, Health Products, and Necessary Items.

Roles and status:
Role in the Society:
Each individual plays a dual role in the society depending on
the group he belongs to. An individual working as Chief Executive
Officer with a reputed firm is also someone’s husband and father
at home. The buying tendency of individuals depends on the role he
plays in the society.
Social Status:
An individual from an upper middle class would spend on
luxurious items whereas an individual from middle to lower
income group would buy items required for his/her survival.

Personal Factors:
A buyer’s decisions also are influenced by personal
characteristics such as the …

• Age & life cycle stage:
Age and human lifecycle also influence the buying
behavior of consumers.
RBC Royal Band stages
• Youth—younger than 18
• Getting started—18-35
• Builders—35-50
• Accumulators—50–60
• Preservers—over 60
Teenagers would be more interested in buying bright
and loud colors as compared to a middle aged or
elderly individual who would prefer decent and subtle
designs.

• Occupation:
The occupation of an individual plays a significant role
in influencing his/her buying decision.
An individual’s nature of job has a direct influence on
the products and brands he picks for himself/herself.
• Economic Situation:
The buying tendency of an individual is directly
proportional to his income/earnings per month.
How much an individual brings home decides how much
he spends and on which products?

• Life Style:
A person’s pattern of living as expressed in his or her
activities, interests and opinions.
Lifestyle is a person’s pattern of living as expressed in
his or her psychographics.
Measures a consumer’s AIOs dimension (activities,
interests, opinions) to capture information about a
person’s pattern of acting and interacting in the
environment.
Activities: work, hobbies. Shopping, sport, social event.
Interest: food, family, fashion and recreation.
Opinions: about themselves, social issue, business,
products.

Personality:
An individual’s personality also affects his buying behavior.
Every individual has his/her own characteristic personality
traits which reflect in his/her buying behavior. a fitness
freak would always look for fitness equipment whereas a
music lover would happily spend on musical instruments, CDs,
concerts, musical shows etc.
Brand personality refers to the specific mix of human
traits that may be attributed to a particular brand
Sincerity
Excitement
Competence
Sophistication
Ruggedness

• Psychological Factors:
A person’s buying choices are further influence by four
major psychological factors.

• Motivation:
A motive is a need that is sufficiently pressing to direct
the person to seek satisfaction of the need.
An individual who is thirsty would definitely not mind
spending on soft drinks, packaged water, juice and so on.
Recognition and self esteem also influence the buying
decision of individuals.

Abraham Maslow’s Hierarchy of
Needs
People are driven by particular needs at particular times.
Human needs are arranged in a hierarchy from most pressing
to least pressing.
 Psychological
 Safety
 Social
 Esteem
 Self-actualization

• Perception:
Perception is the process by which people select,
organize, and interpret information to form a meaningful
picture of the world.
What an individual thinks about a particular product or
service is his/her perception towards the same.
There are three different processes which lead to
difference in perception:
Selective Attention -
Selective attention is the tendency for people to screen
out most of the information to which they are exposed.

Selective Distortion
Selective distortion is the tendency for people to interpret
information in a way that will support what they already believe
Selective Retention
Selective retention is the tendency to remember good points
made about a brand they favor and forget good points
about competing brands
• Learning:
Learning comes only through experience. An individual comes to
know about a product and service only after he/she uses the
same.
An individual who is satisfied with a particular product/service
will show a strong inclination towards buying the same product
again.

• Beliefs And Attitudes:
Beliefs and attitude play an essential role in influencing
the buying decision of consumers.
Belief:
A descriptive thought that a person holds about
something.
Which is based on:
• Knowledge
• Opinion
• Faith
Attitudes:
A person’s consistently favorable or unfavorable
evaluations, feelings, and tendencies toward an object or
idea.

Types Of Buying Decision
Behavior
Buying Decision differs from person to person. Depending upon the need of
the person, the decision gets change; Even if the product is small.
There are different factors which influences the nature of buying.
Hence buying decision has been classified into four different categories.
These are classified depending upon the degree of involvement and degree
of difference among brands.

Four types of buying decision behavior:
Complex buying behavior.
Dissonance- reducing buying behavior.
Habitual buying behavior.
Variety- seeking buying behavior.

1. Complex Buying Behavior:
This situation involves the high level of involvement from
consumers and observe significant difference between the
brands then the consumer undertake complex buying
behavior. These cases arise when the product is of high
price, risky, high for servicing, and so on. For Ex: Buying a
laptop, Car and house. For final decision about buying product
customer seeks information about product features,
attributes and quality from print media and electronic media
sources.

2. Dissonance Reducing Behavior:
This involves high involvement of the buyer but a less
significance difference among the brands. For ex: Buying an
Air Conditioner. Here the product is highly priced but almost
all every brand gives the same features. Sometimes this may
involve the post purchase dissonance behavior. Here the
consumer looks at the disadvantages of the product after
purchase.

3. Habitual Buying Behavior:
Here there will not be any kind of involvement from the
consumer. Here the purchase happens depending upon the
Brand familiarity. Here the consumer involvement is low and
less differences among brands. This happens based on the
habits of buying. For Ex: Buying of a liquid soap . Most of the
people prefer Dettol because of the brand. But there are
other products like Lifebuoy with less significant difference.

4. Variety Seeking Buying Behavior:
Here the consumer involvement is low but there will be significant
difference among brands. For Ex: Biscuits, when we buy a biscuit
we do not know the taste hence after consumption only we can tell
that whether to go for the brand or not for the next time. Here
the companies try to change the nature to Habitual Buying
behavior by different strategies. Sometimes this depends upon
the retailers too.

The Buyer Decision Process
There are five buyer decision process:
Need
Recognition
Information
Search
Evaluation Of
Alternatives
Purchase
Decision
Post purchase
Behavior

1. Need Recognition:
The first stage of the buyer decision process in which the
consumer recognizes problem or need.
Need can be two types:
 Internal stimuli.
 External stimuli.
Internal stimuli when one of the persons normal need.
Example: hunger, thirst, emotions.
External stimuli a need can be triggered by external
stimuli.
Example: an advertisements or a discussion with a friend.

2. Information Search:
Information search is the amount of information needed in
the buying process and depends on the strength of the
drive, the amount of information you start with, the ease
of obtaining the information, the value placed on the
additional information, and the satisfaction from searching.
Sources of information:
Personal sources—family and friends.
Commercial sources—advertising, Internet.
Public sources—mass media, consumer organizations.
Experiential sources—handling, examining, using the
product.

3. Alternative Evaluation:
The stage of buyer decision process in which the consumer
uses information to evaluate alternative brands in the choice
set.
4. Purchase Decision:
The buyer’s decision about which brand to purchase.
•May come between purchase intention and decision
•Attitudes of others and unexpected situational factors.

5. Post Purchase Decision:
The post-purchase decision is the satisfaction or
dissatisfaction the consumer feels about the purchase
Relationship between:
 Consumer’s expectations
 Product’s perceived performance.

• Consumer satisfaction is a function of consumer
expectations and perceived product performance.
• Performance < Expectations --- Disappointment
• Performance = Expectations --- Satisfaction
• Performance > Expectations --- Delight
Cognitive dissonance is the discomfort caused by a post-
purchase conflict.
Why is it so important to satisfied the customer?
Customer satisfaction is a key to building profitable
relationships with consumers—to keeping and growing
consumers and reaping their customer lifetime value.

The Buyer Decision Process
For New Products
New Product:
New product is a good, service, or idea that
is perceived by some potential customers as
new..

Adoption Process:
Adoption process is the mental process an individual goes
through from first learning about an innovation to final
regular use.
Stages include in Adoption Process.
Awareness
Interest
Evaluation
Trail
Adoption

Awareness is when the consumer becomes aware
of the new product but lacks information about it.
Interest is when the consumer seeks information
about the new product.
Evaluation is when the consumer considers
whether trying the new product makes sense.

Trial is when the consumer tries the new product
on a small scale to improve his or her estimate of
its value.
Adoption is when the consumer decides to
make full and regular use of the new product.

Individual Differences In Innovation

Individual Differences In Innovation
Early adopters are opinion leaders and adopt new ideas
early but cautiously.
Early majority are deliberate and adopt new ideas
before the average person.
Late majority are skeptical and adopt new ideas only
after the majority of people have tried it.
Laggards are suspicious of changes and adopt new ideas
only when they become tradition

Influence of Product
Characteristics
on Rate of Adoption:
Is the innovation superior to existing
products?
Relative
Advantage
Does the innovation fit the values and
experience of the target market?
Compatibility
Is the innovation difficult to understand
or use?
Complexity
Can the innovation be used on a limited
basis?
Divisibility
Can results be easily observed or
described to others?
Communicability