consumer behavior-unit 1&26
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8/14/2019 Consumer Behavior-Unit 1&26
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Consumer Behavior
Semester -3
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What is Consumer Behavior
• The Behavior that consumers display in
searching for , purchasing , using , evaluating ,
and disposing of products , services , and
ideas to satisfy certain needs or desires .
• Personal Consumer / Organizational Consumer
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Why study consumer Behavior
• Shorter Product Life cycle
Eg : mobile phones , cameras etc.
• Evolving consumer Preferences – Eg : Herbal Products
• Environmental Concerns – Green Products , Electric cars etc .
• Changing Lifestyles – Sugar free drinks , Diet food etc .
• Faster technology adoption – Online shopping etc .
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Why study consumer Behavior
• To understand issues like –
– How consumers think , feel , reason and select among
different alternatives ( eg: brands & products )
– How consumers are influenced by their environment (eg: culture , family , peer group , and media )
– The behavior of consumers while shopping or making
any choice decisions
– How marketers can adapt and improve their
marketing campaigns or strategies to quickly
penetrate into the market .
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Understanding consumer and market
segments
• Market Segmentation can be defined as the
process of dividing a market into distinct
subsets of consumers with common needs or
characteristics and selecting one or more
segments to target with a distinct marketing
mix .
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Bases for Segmentation
• Geographic Segmentation- Region , citywise ,climate etc .
• Demographic Segmentation – Age , sex,
marital status , Income , Education ,Occupation etc .
• Psychological Segmentation –needs –
motivation , personality , attitude , perceptionetc .
• Psychographic – Life style segmentation
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Bases for Segmentation Contd..
• Socio cultural – cultural , religion , sub culture, social class , family life cycle
• Use Related – Usage rate , awareness status
etc .• Use – situation segmentation – eg: time,
objective , location etc.
• Benefit Segmentation -• Hybrid Segmentation –psychographic-
demographic , geodemographic
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Micro factors influencing Consumer
Behavior
Buyer
Social Factors
Social Class
Reference Group
Family
Roles & Status
Personal Factors
Age & Life cycle stage
Occupation
Personality
Lifestyle
Psychological Factors
Motivation
Perception
Beliefs & Attitudes
Learning
Cultural Factors
Culture
Sub culture
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Assignment/ Presentation
• Surf Internet and write short notes on the following(withexamples ) – VALs
– Psychographic analysis (AIO)
– Hybrid Segmentation – Baby Boomers
• Pick atleast two print advertisements of any product /brand from a magazine /newspaper and give atleast 5
reasons( in points) why did it appeal to you,as a consumer .Mention the name of the magazine/newspaper and pastethe Ad(or photocopy ) in your assignment .
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Culture
• Culture is the set of basic values , perceptions, wants and behaviors learned by a member ofsociety from family, place of residence and
other important institutions .• Culture is the most basic cause of person’s
wants and behavior
• Every group or society has culture and culturalinfluences on buying behavior may varygreatly from country to country .
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Culture
• Enculturation : Learning of one’s own culture
is known as enculturation
• Acculturation : The learning of new or foreign
culture is known as acculturation
• Culture is learned , shared , has language &
symbols , rituals , dynamic .
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Sub Culture
• It provides more specific identification and
socialization for members belonging to a
particular religion , racial group ,and
geographic regions .
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Emergence of New Consumer culture
• Eating out grows in Urban India
• Pub culture in its infancy
• Women gain confidence with color cosmetics• Fair skin on the wishlist
• Films dictate fashion
• PC games attracting younger generation /PSPs• Saving rates dropping
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Example : Rituals ( America)
• Wedding – White gown
• Birth of Child – Silver spoon
• Birthday – Cake , party , candles
• Graduation – Pen , card
• Valentine’s day –Card , Flowers , Roses
• New Year’s Eve – Champagne , party
• Going to the Gym – Towel, water , specialclothes , wrist band
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Example :American Core Values
Value General Features Relevance to Consumer
Behavior
Achievement and success ,
Activity
Hard work is good , Keeping
busy is healthy and natural
Justification of acquisition of
goods ( “ You deserve it “ )
Time saver products , enhance
leisure timeIndividualism Being oneself ( self reliance ,
self interest , self esteem)
Stimulates acceptance of
customized or unique products
that enable to express his or
her own identity)
Freedom Freedom of choice Fosters interest in wide
product lines anddifferentiated products
Youthfulness A state of mind that stresses
being “young at heart “ and
having youthful apperance
Stimulates acceptance of
products that provide the
illusion and maitaining or
fostering youthfulnss
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Few Indian Examples : Handouts
• Companies – Maggi
• Ads catch up with new trends
• Industry – Food Industry / Fashion Industry /Gadgets
• Geographies – Delhi / Tamil Nadu / Gujarat
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Groups
• A group consist of people who have a sense ofrelatedness as a result of interaction with each
other .
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Groups
Type Distinction
Formal vs Informal Formals Groups have clearly specified
goal , structure etc . Informal groups are
loosely structured
Primary vs Secondary Primary Groups are involved in gace to
face interaction ;secondary groups
interact less intensely
Aspirational vs Dissociative Aspirational Groups are those which an
individual wishes to join ;dissociativegroup is one that an individual wishes to
avoid
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Reference Group
• A person or group that serves as a point of
comparison (or reference) for an individual in
the formation of either general or specific
values ,attitudes or behavior
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Extent of Reference Group Infuence
• Visibility of Consumption
• Commitment to Group
• Conformity Requirement• Capability to take independent decisions
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Marketing startegies & Reference
Groups
• Personal Selling Strategies
• Advertising Strategies – Celebrity
Endorsement / Emotional Appeal /
aspirational appeal / peer appeal /expert
appeal
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Referent Group Appeal
Situation/ Product Appeal Element Types of Appeal Aim of
Communication
Urmila in Lux ad Film Star Aspirational Increase brand
awareness& reduce
perceived risk
Aamir Khan in Coke
Ad
Film Star Aspirational Increase Brand
wareness & create
favorable attitude
Colgate Total/
Indian Dental
Association
Association Backing Expert Reduced perceived
risk from
consumptionWheel Detergent
showing poor wash
quality if wheel not
used
A typical middle
class housewife
Peer Group Branf awareness/
creation of
favorable brand
attitude /creation
of purchase
intention
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Effectiveness of Endorsement
• Credibility
• Attention
• PR Coverage• Higher Recall
• Associative benefit
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Family / Household decision making
• Roles
– Information gatherer
– Influencer
– Gatekeepers – Decision makers
– Purchasers
– Users – Maintainers
– Disposers
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Family Life Cycle
• Stage 1 – Bachelorhood
• Stage 2- Honeymooners
• Stage 3- Parenthood – Full nest 1
– Full nest 2
– Full nest 3
• Stage 4- Postparenthood
• Stage 5- Dissolution
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Bachelorhood
• Employed , graduates , college going
• Young single Adults – spend on rent ,automobiles , travel , entertainment , clothing ,assesories
• Niche segment for travel agents , housingdevelopments , health clubs , sports clubs ,magazines etc.
• “ To be married “ market ……bridal industry (wedding sites , special parlours , special markets ,products etc .)
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Honeymooners
• Young married couples
• Start up expenses – house , major/minorappliances , furniture , utensils ,etc .)
• Special magazines – Goodhousekeeping,Betterhomes etc .
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Parenthood
• Sometimes called Full nest stage …usually extends over 20years
• Full nest 1: immediately afetr the first child is born….manywives stop working …reduction in family income ….newpurchases like baby clothes , food , health products etc….choice of vacations , restaurants , automobiles etc .
• Full nest 2: Financial position improves with careeradvancement of husband …wife may return to work…lessinfluenced by advertising …with experience
•
Full nest 3 : family’s income continues to grow ….childrenalso employed ….influence by ads almostnegligible….replacement of old items , more tastefulfurniture , cars , luxury items , vacations etc .
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Post Parenthood
• Children have left home …empty nest stage
• Comfortable stage for parents to spend on
themselves , travel , extended holidays …higher
disposable income because of savings…..
• Empty nest 1: satisfactory financial position
….spendings on gifts , vacations
• Empty nest 2: Income is drastically cut , expenseson medical care , products that aid their health ,
sleep , digestion etc .
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Dissolution
• Death of one spouse
• Simple living and economical
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Marketing applications – Household
Buying
• Understand difference in consumptionpatterns of different households
• Develop product and promotional startegies
with recognition of changing gender roles andresponsibilities
• Use of concept of family life cycle as basis ofmarket segmentation
• Target products and services properly for thefamily roles in decision making
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Social Factors
• This is relatively homogeneous and enduringdivisions of the society as all societies exhibitsocial stratification
• Social Class is usually determined by a cluster ofvariables rather than single variable (occupation ,income , wealth , education etc .)
• Marketers must be careful about the kind of
advertisements /communication they make asper the target audience ( language prefernces /lifestyle differences etc .)
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Handouts & Discussion on Ads on
social Class
• Luxaflex
• Citibank etc .
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Consumer Motivation
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Consumer Motivation
• Consumer Motivation is one of the driving forcesof Consumer Behavior
• Consumers buy and use products because theyare motivated by the need and desire to do so .
• The Primary objective of Marketing and
Marketing Communication is to motivateconsumers to prefer and purchase one productand a specific brand over other
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Motives
• Motive is a construct representing an
unobservable inner force that stimulates and
compels a behavioral response and provides
specific directions to that response
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Consumer Motives
Motives Explanation Example : Car
Functional Involves utility of the product/service or
the function it performs
Purchase of a car because of
its fuel efficiency, space ,
reliability
Aesthetics
/emotional
Involves the appearance or
attractiveness of product /service
Purchase of a car because of
its color , shape , style etc .
Social Reflected in the status and esteem
value
Purchase of a car because it
shows that the buyer is a “cut
above “
Situational Unexpected benefit of a product and
service : Discounted price etc .
Freebies along with purchase
Curiosity Interest arises by a product and service Purchase of a sports car
because it will be a new
experience
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Arousal of Motives
• Physiological arousal
– Hunger need
• Emotional arousal
– Daydreaming , desires etc .
• Cognitive arousal
– Advertisements ……call up parents when you see ads
of telecom operators etc .• Environmental/Situational arousal
– 6’o’clock – smell of bakery food arouse need for food
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Role of Motives
• Role of Motives in Consumer Behavior is to arouse anddirect the behavior of Consumers.
Defining Basic Striving :Motives influence consumers to
develop and identify their basic striving which includesgeneral goals ….safety, affiliation ,achievement etc .
Example : “ You can’t imagine how fast it will help you
grow in life !!!” Aptech Certified Internet Professional
Aptech Computer Education
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Role Of Motives …..Contd
Identifying Goal Objects
Consumers view products or services as
means by which they can satisfy their motives
…..Consumer Illusion
Example: “By Wearing Reid and Taylor ,
you can personify “ James Bond “ or
“Amitabh Bachchan “
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Role Of Motives ………..Contd
Influencing Choice Criteria
Motives themselves can guide consumers
to buy a certain product and not the other
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Classification Of Motives
• Strong vs Weak
• Positive vs Negative
• Rational vs Emotional
• Latent vs Manifest Motives
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Strong vs Weak Motive
• Strong Motives : Consumers are well aware ofthe importance of the buying decision …..infavor of marketers
• Weak Motive : Consumer ignorant of theimportance of buying decision ..marketersneed to facilitate consumer’s action to reachdesired goal .
• Air Conditioners /Referigerators etc .
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Positive and Negative Motivation
• Positive : When consumer feel a driving force towards an object orcondition…..also known as need
• Negative : When they feel a driving force away from an object/condition……….fear/aversion
• Ad by VLCC….Before-95 Kgs /After- 70 Kg …. • Two photographs of the same person are given such that the
negative motive of not being fit will make you attracted to avail theservices rendered by VLCC.
• Ad by Neutrogena• “Now get a perfect sunless tan instantly ………(model smiling)”
• “Dermatologist Report : A year of incidental Sun equals Baking for aweek at the Beach !”
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Rational vs Emotional
• Rational : When the consumer’s buying behavioris a carefully chosen and well considered one
• Consumer’s selection is based on objectiveevaluation : size , weight , price etc .
• Emotional : If the consumer is emotionally guidedin selecting the object ….pride , emotion ,statusetc .
• Personal /Subjective criteria : pride , fear ,affection , status etc .
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Latent vs Manifest
• Manifest motives: These motives are known to customersand he openly admits to being influenced by them…..conform to society’s prevailing value system
•Latent motives are unknown to customers …customer isreluctant to admit their influence on him in front of others
• Eg : Why did you buy “ Lux” Soap ? – for healthy skin , fragrance etc ……….manifest
– Because I want to have skin as beautiful as Aishwarya Rai..latent
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Example
Manifest Motives Consumption Behavior Latent
•It is a hi Tech Car
•Its large size is
comfortable•It is a fault free
engineering marvel
Purchase aMercedes Benz
•It will demonstrate
my success•I can make others
feel envious
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Consumer Buying Process
NeedRecognit
ion
ProductAwaren
ess/Informat
ionSearch
Interest
Evaluation andIntentio
n
Purchase
Decision
PostPurchas
eBehavio
r
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Need Recognition
• Need arousal
– Internal stimulus : hunger, thirst etc
– External stimulus : display of an item
• Marketer must identify the drive
• Timing of need arousal is important
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Maslow’s Needs Exemplified
Physiological Needs
Products Vitamins, herbal supplements, medicines, food,
exercise equipment, fitness clubs
Marketing themes Pepfiz antacid—‖Just one and heartburn’s done‖
Jiyo Jee Bhar Ke, Thodi si Pet Pooja…Kabhi bhi
kahin bhi ….,
Safety Needs
Products Cars and car accessories, burglar alarm systems,retirement investments, insurance,
medicines,Cement
Marketing themes Jeetey Raho
Volvo—―Protect the body. Ignite the soul.‖
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Contd…..
Belongingness
Products Beauty aids, entertainment, clothing, cars
Marketing themes Old Spice —‖The Mark of a Man‖
Loreal ….‖Because I am worth it ―
Esteem Needs
Product Clothing, cars, jewelry, hobbies, beauty spa services
Marketing themes Toyota : ―Quality Revolution‖
kitchen appliances—―The sign of a great cook.‖
Diamonds are Forever , Reid n Taylor ,Tag Heur Watches
Self-Actualization
Products Education, cultural events, sports, hobbies, luxury goods, technology, travel
Marketing themes Nike – Just Do it
―An evening with Jagjit Singh ―,
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Needs
• Every individual has needs :some are innate ,others are acquired
• Innate : food , water , air clothing , shelter ,sex….needed to sustain biological life ….Primaryneeds or motives
• Acquired needs : Need for self esteem , prestige,affection , power , learning …….psychological….Secondary needs or motives .
Product Awareness/ Information
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Product Awareness/ Information
Search
• Consumer gathers information – Heightened attention : consumer more receptive and alert
to the information
– Active information search : tries to collect information
• Sources of information
– Personal : family , friends , neighbors etc .
– Commercial: Advertisement, sales men , dealers etc .
– Public Sources: mass media ,consumer rating organization
etc . – Experiential Sources :handling , examining , using the
product .
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Stages of Information Processing
• Exposure
• Attention
• Comprehension
• Acceptance
• Retention
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Interest
• State of mind that exists when a consumer
perceives a need and /or is aware of
alternative products capable of satisfying that
need .
• If attention is diverted , buying process is
broken down
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Evaluation and Intention
• Stage of mental trial of the product
• Draws conclusions about their relative
satisfaction giving potential value .
•Develops the intention to either purchase
/reject the brand/ product
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Evaluation of Alternatives
• Options available to the marketer :
• Modify the Product : Redesign
• Altering beliefs about the brand
• Altering belief’s about the competitor’s brand
• Calling attention to neglected attributes
• Shifting the buyer’s ideals
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Purchase Decision
• Consider attitudes of others : negative attitude orconsumer motivation
• Anticipated Situational factors : family income
• Unanticipated situational factors : accidents , illness ,travelling etc .
• 5 purchase decisions : – Brand decision
– Vendor decision
– Quantity Decision – Timing Decision
– Payment method decision
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Types of Buying Decisions
• RRB/ habitual buying
• LPS buying
• EPS buying
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Post Purchase feelings/Behavior
• Consumer is satisfied if the product matcheshis expectations
• Highly satisfied , if exceeds expectations
• Repeat Purchase ……word of mouth ….” Ourbest advertisement is a satisfied customer”
• Dissonant Customer : Return the product or
seek information that confirm its high value….Action: Complaining
• Post purchase disposal
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Needs
• Every individual has needs :some are innate ,others are acquired
• Innate : food , water , air clothing , shelter ,sex….needed to sustain biological life ….Primaryneeds or motives
• Acquired needs : Need for self esteem , prestige,affection , power , learning …….psychological….Secondary needs or motives .
Marketing Strategy and consumer
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Marketing Strategy and consumer
Behavior
• Marketing Analysis – consumer, conditions
,competitor , company
• Marketing Segmentation
• Marketing Strategy-4 Ps
• Consumer Decision Process
• Outcomes-customer satisfaction, sales ,
Product/brand image
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Consumer Personality
• Personality is an internal system which includesall those aspects of a person that are inheritedand all those aspects that are learned .
• Those inner psychological characteristics thatboth determine and reflect how a personresponds to his or her environment . – Inner characteristics : those specific qualities
,attributes ,traits ,factors ,and mannerisms thatdistinguish one individual from other individuals
• Aggressive , friendly , moody, arrogant………
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Sources of Influence
• Inherited from parents
• Influenced by the environment in which the
person is brought up
• Own individuality
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Personality and Consumer Behavior
• Optimal Stimulation Level (OSL) – Physically stimulating , emotionally energizing
– Golfer vs Polo Player /Bunjee jumping etc .
– Innovators (first consumers to buy ,seek information about newproducts etc……more curious , buy products with greater risks
• Dogmatism – Tendency to resist change /new ideas
• Need for Cognition – Effortful thinking, deliberating , contemplating
• Susceptibility to influence
– Desire to enhance their self image as observed by others ….Consumerswith lower information procewssing confidence tend to be moreinfluenced by ads ,relative to those with higher self confidence.
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Example
• “ Women around the world don’t hesitate to
do it .Why should I ?”
• Beautiful women around the world over are
opting for the Gillette Satin Care Ready shaver
.A smart choice since it’s an international
razor designed exclusive for women . Itsspecial features include :………….”
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Marketing Applications of Personality
• Position Brands as per the consumerpersonality type
• Avoid targetting innovative products to rigid
consumers and consumers with low tolerancefor ambiguity
• Identify the extent to which consumers ofthe product category are prone to discounts/rebates and how value conscious they are,then market accordingly
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Theory of Self Concept
Dimensions Actual Self concept Ideal Self Concept
Private Self How I actually see myself How I would like to see
myself
Social self How others actually see
me
How I would like others to
see me
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Example : Ad by Nike
• “Got what it takes “ • “It takes courage to fight the odds ,stamina to lat forever
,conviction from within and a dream to be victorious “
• The new winter line from NIKE, fights defeat ,absorbsvictory .
• Just do it !!!!!
• Most of us constantly strive to bridge gap between ourprivate actual self and ideal self .Thus ,those who don’t
exercise know that excercising is good ,and ideally wouldlike to .This ad is exhorting them to go ahead and taketheprepatory step, i.e to buy a track suit
l d d
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Actual and Desired Concepts
Actual Self Concept
:Private / Social
Desired Self
Concepts :Private /Social
Product
MediaServices
d
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Attitude
• Attitude is a learned predisposition to behave
in a consistently favorable or unfavorable way
with respect to a given object /stimuli.
Ch i i f i d
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Characteristics of Attitude
• Attitudes have an object
– Focal point …physical object ,or a service or an action
• They have direction , intensity , and degree
– For or against ,extent of like /dislike , how strongly aperson feels about his conviction
• They have structure
– Consistent , generalizable towards a class of object• They are learned
– Direct /indirect experiences
S f A i d D l
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Sources of Attitude Development
• Personal experience
– Needs
– Selective Perception/interpretation
– Personality
• Group Associations (family , work and peer
groups etc.)
• Influential others (experts , opinion leaders,relatives ,celebrities etc.)
C f A i d
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Components of Attitude
• Cognitive Component
• Affective component
• Behavioral Component
C i i C
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Cognitive Component
• Consumer’s Belief about an object
• Eg : Dettol Soap is antibacterial , is effective , notperfumed
• These beliefs may or may not conform to reality
• More the number of positive beliefs about the brand ,greater the positiveness of each positive belief ,morefavorable the overall cognitive component of attitude
Aff ti C t
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Affective Component
• A consumer’s feelings or emotional reactions tothe object represent the affective component .
• May be a result of cognitive evaluation
• Emotional or effective evaluation of products
/brands• Amul Cheese vs Britannia Cheese
B h i l/C ti C t
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Behavioral/Conation Component
• One’s tendency to respond in a certainmanner towards an object or activity
• Recommendations to friends etc .
• Actual behavior
Attitude Components &
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p
Manifestations
StimuliProducts
Situations
Retail
Outlets
Sales People
Ads
Other
Objects
Cognitive
Affective
Behavioral
Beliefs about
specific
attributes or
overall objectEmotions or
feelings about
specific
attributes or
overall objects
Behavioral
intentions with
respect to
specific
attributes or
overall objects
Overall
orientation
towards an
object
Attit d B h i C i t
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Attitude Behavior Consistency
• Factors influencing Attitude –Behaviorconsistency :
• Consumer Influences – Consumer’s access to resources
– Consumer’s past experience with the brand – Action/inertia orientation of the Consumer
• Situational Influences – Time gap between positive attitude formation and
actual opportunity to buy – Message repetition
– Social Influence
M difi ti f Attit d
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Modification of Attitude
• A Change in attitude is ensured through :
• Appropriate Source of Communication
• Appeal Characteristics
S f C i ti
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Source of Communication
• Source Credibility
– Credible Sources like BIS( Bureau of Indian
Standards ),ISO 9001, Indian Dental Association
etc.• Celebrity as source
– Shahrukh “Mayur” Khan , Aamir Khan for Tata Sky
, Amitabh Bachchan for Reid n Taylor , Sachin
Tendulkar for Boost
A l Ch t i ti
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Appeal Characteristics
• Fear Appeal
– Accidents in case of Drunken driving ,social fears
like bad breath , body odor, bacterial infections etc
• Humor appeal – Bingo , Centre shock etc.
– Attracts attention, does not generally increase
persuasion ,increases liking of the ad .
Appeal characteristics Contd
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Appeal characteristics Contd….
• Comparisons – Ads by Detergents ( Rin vs Tide )
• Emotional appeal
– Ads by Insurance Companies – Attracts attention , memorable etc .
• Value expressive vs Utilitarian approach – Creates an image for the product user
– Ads for Perfumes , cosmetics etc.
Strategies adopted by Marketers to
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g p y
bring Attitudinal Change
• Change Consumer’s basic motivational function
– Utilitarian function
– The Ego defensive function
– The Knowledge function – Eg : Ad by NDDB for milk promotion
– Eg: How much is calcium requirement in a body ?
•Associate the product with the admired group
– Cause related ads -Blind Relief association , Old age
Homes etc .
Strategies contd
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Strategies ….contd
• Resolving conflicting attitudes – Navratri special food in Nirulas , special vegfood in
Pizza Hut , Sugarfree etc.
• Change beliefs about the product /brand
– Adding an attribute
– Tanishq jewellery for Woking women, Citizen Watchesad by Kareena Kapoor
• Changing beliefs about the Competitors Brands
Tricomponent Model
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Tricomponent Model
AffectPositive/ne
gativefeelings
Cognition
Beliefs
Conation
Behavior/action
/intentionto buy
Attitude towards the Ad Model
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Attitude- towards- the- Ad Model
• Impact of Advertising or some other promotionalvehicle ( eg: a catalogue )
• Consumer forms various feelings (affect) and
judgments ( cognition) as a result of exposure toAds
• These feelings and judgements in turn affect the
consumer’s attitude toward an ad and beliefsabout the brand
Attitude Toward the Ad Model
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Attitude –Toward- the -Ad Model
Judgments
about the Ad
(Cognition)
Exposure to
an Ad
Beliefs about
the brandAttitude
toward the
Brand
Attitude
toward the
Ad
Feelings from
the Ad
(Affect)
Nicosia Model
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Nicosia Model
• Developed by Fransisco Nicosia
• There are four basic “ Fields “ in the model
• Assumption : Neither the buyer nor the seller has had anyprevious experience directly related to the product /brand
• The model is viewed as representing a situation where afirm is designing communications(ads, products etc)to
deliver to consumers , whose response will influencesubsequent actions of the firm .
Nicosia Model Contd
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Nicosia Model Contd….
Firm’sAttribute
s
Consumer’s
attributes
Search and
Evaluation
Decision
(Action)
Consumption
Message
exposure Attitude
Purchasing
Behavior
Experience
FIELD ONE: From the source of message to the consumer’s attitude
FIELDTWO:Search
and evaluation
of means/end
relations
Motivation
FIELD
THREE: Act
of Purchase
FIELD
FOUR:Feedback
Nicosia Model : Explained
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Nicosia Model : Explained
• Field 1 represents the output of commercial messagefrom the firm in form of advertising or other form ofpromotions …….this becomes input for field 2
• Field 2: Evaluation by the consumer of the product andother alternatives …..If there is favorable attitude andmotivation to buy , it becomes input for Field 3
• Field 3 : Represents act of purchase
• Field 4 : Includes – use and storage of the product ,
– retention of experience by the consumer as an influencingfactor in future purchase
– Feedback of sales
Howard Sheth Model
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Howard Sheth Model
• The model explains the buyer decision processusing 6 sets of variables :
1. Input variables
2. Behavioral determinants3. Perceptual Reaction
4. Processing Determinants
5. Inhibitors6. Output Variable
Howard Sheth Model
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Howard Sheth Model
InputsProducts ,
services , brandFacts , Images ,
feelings
Behavioral Determinants
Personality
Culture
Social ClassImportance of purchase decision
Perceptual
reactionPerceptual bias
Sensitivity toinformation
Filtering of
information
ProcessingDeterminants
Purchase
motivation
Avalilablesatisfactions
Judgemental
criteris
OutputsAttention
Understanding
Attitudes
Purchase intention
/purchase
behavior/decision
Actual Purchase
Or no purchase or
delay
Inhibitors
Price of the product /brand
Availability of product/brand
Financial status of individual
Time constraints on individual
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Post Purchase Behavior
Consumption
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Consumption
• Consumption, in its broadest and simplestform , means possession and/or use of goods
and services
Consumer’s post purchase
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behavior
• Consumption
• No consumption
• Disposition
• Repeat purchase
• Recommend the product / brand to others .
Confirmation/Disconfirmation
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Confirmation/Disconfirmation
• Confirmation : Product performance is asgood as expected
• Disconfirmation :
– Positive : When the product performance is betterthan expected
– Negative : Performance at lower level than that
expected.
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Post Purchase dissonance
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Post Purchase dissonance
• Did I make the right decision?
• Should I have done / bought something else ?
• Feeling of uncertainty about whether right choiceis being made…..
• Occurs before the consumer is determined aboutthe satisfaction
PPD is a function of :
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PPD is a function of :
• Importance of Purchase decision
• Consumers tendency toward anxiety
• Finality of the purchase decision
• Clarity of the final purchase choice
Reducing Dissonance : Attempt by
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Consumer
• Change his evaluation of alternatives: SelectedRetention
• Seeking new information : To reassure
• Changing attitudes
Marketing Applications : Consumer
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satisfaction and Dissonance
• Confirming expectations
• Inducing attitude change: Promotional
techniques like free Samples , sachets etc .
• Reinforcing buyers
Marketing Applications of Post
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Purchase behavior
• Encourage brand and outlet loyalty• Respond promptly to dispel rumors and other
negative communications
• Offer redress to consumers who complain andthereby regain a positive brand or outletimage
• Use feedback from both positive and negativepost purchase behaviors to improve productsand promotions
Communication
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Communication
• Communication is defined as transmitting ,receiving and processing information
Communication Process
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Communication Process
Example
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Example
• Senders : are the companies that manufacture shoeslike Reebok , Nike etc .( the firms hire adbertisingagencuies to construct messages )
• Encoding : Taking the idea and transforming it into anattention –getting form , through an ad or some other
verbal . The ad creative performs this role• Message Channel :The channel may be television
carrying an ad , billboard , newspaper etc .
• Decoding : occurs when the message touches the
receiver’s senses in some way. Some consumers willhear and see a TV ad …..smell perfume …readingcoupon offer etc .
Example : Contd …..
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Example : Contd …..
• Quality marketing communication occurs when therecievers decode or understand the message as it wasintended by the sender
• Noise is anything that distorts or disrupts the message .
Can occur at any stage• Clutter : exists when consumers are exposed to
hundreds of marketing messages per day , and mostare tuned out .
• Feedback : takes form of purchases , inquiries ,complaints , questions , visits to the store or “ likes “ or“hits “ on the websites / Social networking sites
Process of Marketing Communication
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Process of Marketing Communication
Marketing
Manager or
Company
Consumer
( Target
Audience
Target
Audience
Interpretati
on
Ad media (
Print/Electro
nic /Direct)
Sales man
PRAdvertising
/Publicity
/Sales
Presentatio
n
Sender
Encoding
Channel Media
Decoding
Receiver
Feedback (Marketing
Research Sales Reports )
Barriers to Communication
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Barriers to Communication
• Between individuals ( age , gender, socialstatus , personality etc )
• Within companies ( poor downward/
upward/lateral flow etc .)• Between Companies ( poor selling techniques
, poor media choices , unfocussed advertising ,
failure to find correct contact persons )
Marketing Communication
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Marketing Communication
• The marketing communication mix(also calledpromotion mix )consists of four major tools:
– Advertising
– Sales Promotion
– Publicity
– Personal Selling – Public Relations
Objectives of Marketing
C i ti
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Communication
• Informing
• Persuading
• Reminding
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IMC contd….
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• According to American Marketing Association….
“IMC is a planning process designed toassure that all brand contacts received by the
customer or prospect for a product ,service ,
or organization are relevant to that personand consistent over time “
Factors in setting the Communication
i
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mix
• Type of Product Market• Push or Pull Strategy
– Push strategy :• When there is no Brand loyalty
• Product is an impulse item
– Pull strategy :• When there is high brand loyalty
• High involvement category
• Buyer readiness stage• Product Life Cycle stage
• The Company’s market rank
Buyer Readiness Stage
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y g
• Advertising & Publicity play the most importantrole in awareness building stage
• Customer comprehension is affectd byadvertising & personal selling
• Customer conviction : Personal selling
• Closing of sale : Personal selling & Salespromotion
• Repeat purchase : Personal selling , salespromotion , remider advertising
PLC
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• Introduction Stage : Advertising & Publicity havethe highest cost effectiveness followed by
personal selling / Sales promotion to induce trial
• Growth Stage : all tools are toned down as WOMgains momentum
• Maturity Stage : Sales Promotion / advertising /
personal selling all grow important
• Decline : Sales promotion / advertising &
Pubilicity are reduced
Company’s Market rank
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p y
• Impact on the target audience is measured byasking :
– Whether they recognize / recall the brand
– How many times they saw the message – How they felt about the message
– The previous and current attitudes towards the
product and company
4Ps vs 4 Cs
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• Product vs Consumer
• Price vs Cost
• Place vs Convenience
• Promotion vs communication