CHAPTER CONSUMER BEHAVIOR 05 McGraw-Hill/Irwin Copyright © 2012 by The McGraw-Hill Companies, Inc. All rights reserved.

5-2 LEARNING OBJECTIVES Consumer Behavior LO1Articulate the steps in the consumer buying process. LO2Describe the difference between functional and psychological needs. LO3Describe factors that affect information search. LO4Discuss post-purchase outcomes. LO5 List the factors that affect the consumer decision process. LO6 Describe how involvement influences the consumer decision process.

5-3 The Consumer Decision Process

5-4 Need Recognition Functional needs Psychological needs Royalty-Free/CORBIS ©Digital Vision/PunchStock

5-5 Search for Information Internal Search for Information External Search for Information

5-6 Factors Affecting Consumers’ Search Process Perceived Benefits Perceived Costs

5-7 The Locus of Control Internal Locus of Control = more search activities External Locus of Control = Fate, external factors Royalty-Free/CORBIS ©Comstock/JupiterImages

5-8 Actual or Perceived Risk Performance risk Financial risk Psychological risk

5-9 Evaluation of Alternatives: Attribute Sets Universal Retrieval Evoked

5-10 Evaluation of Alternatives: Evaluate Criteria Evaluative Criteria Determinant Attributes What are some of the features of a vacation that would be in your evaluative criteria? Digital Vision/Getty Images

5-11 Evaluation of Alternatives: Consumer Decision Rules Consumer Decision Rules

5-12 Evaluation of Alternatives: Decision Heuristics Mental Shortcuts PriceBrand Product presentation Amos Morgan/Getty Images

5-13 Check Yourself 1. What is the difference between a need and a want? 2. Distinguish between functional and psychological needs. 3. What are the various types of perceived risk? 4. What are the differences between compensatory and noncompensatory decision rules?

5-14 Purchase and Consumption Increase Conversion rate Reduce real or virtual abandoned carts Merchandise in stock Reduce the actual wait time

5-15 Post-purchase: Customer Satisfaction Build realistic expectations Demonstrate correct product use Provide money back guarantee Encourage feedback Customer contact Digital Vision/Getty Images

5-16 Post-purchase: Dissonance Firm’s attempt to reduce dissonance by reinforcing the decision Thank you letters, congratulations letters, quality ratings ©Lars A Niki

5-17 Post-purchase: Customer loyalty Marketers attempt to solidify a loyal relationship. Satisfied customers purchases and buy from the same company again. ©Lou Cypher/Corbis

5-18 Check Yourself 1. Identify the five stages in the consumer decision process.

5-19 Factors Influencing the Consumer Decision Process

5-20 Psychological Factors: Motives Courtesy Taco Bell

5-21 Psychological Factors: AttitudeAttitude BehavioralAttitude CognitiveAffective ©K Rousonelos

5-22 Psychological Factors: Perception How has society’s perception of people with tattoos changed in recent years? Ryan McVay/Getty Images

5-23 Psychological Factors: Learning and Lifestyle Learning affects both attitudes and perceptions Lifestyle involves decisions in spending time and money Royalty-Free/CORBIS

5-24 Social Factors: Family Digital Vision/Getty Images

5-25 Social Factors: Reference Groups Groups Family Friends Coworkers Famous people Provide: information rewards self-image

5-26 Social Factors: Reference Groups GEICO Commercial Photo by James Devaney/WireImage

5-27 Social Factors: Culture Royalty-FreeCORBIS C Squared Studios/Getty Images Geoff Manasse/Getty Images

5-28 Situational Factors Purchase SituationShopping Situation Courtesy Murphy O’Brien Public Relations/Santa Monica, CA

5-29 Check Yourself 1. What are the types of needs suggested by Maslow’s Hierarchy of Needs? 2. Which social factors likely have the most influence on: a. The purchase of a new outfit for going out dancing? b. The choice of a college to attend? 3. List some of the tactics stores can use to influence consumers’ decision processes.

5-30 InvolvementInvolvement and Consumer Buying Decisions

5-31 Types of Buying Decisions Extended Problem Solving Limited Problem Solving – Impulse Buying Impulse Buying – Habitual Decision Making Habitual Decision Courtesy Wendy’s International, Inc.

5-32 Check Yourself 1. How do low versus high involvement consumers process information in an advertisement? 2. What is the difference between extended versus limited problem solving?

5-33 Return to slide An attitude is a person’s enduring evaluation of his or her feelings about and behavioral tendencies toward an object or idea. Glossary

5-34 Return to slide Consumer decision rules are the set of criteria that consumers use consciously or subconsciously to quickly and efficiently select from among several alternatives. Glossary

5-35 Return to slide Determinant attributes are product or service features that are important to the buyer and on which competing brands or stores are perceived to differ. Glossary

5-36 Return to slide Evaluative criteria consist of a set of salient, or important, attributes about a particular product. Glossary

5-37 Return to slide A consumer’s evoked set comprises the alternative brands or stores that the consumer states he or she would consider when making a purchase decision. Glossary

5-38 Return to slide Extended problem solving occurs during a purchase decision that calls for a lot of effort and time. Glossary

5-39 Return to slide Functional needs pertain to the performance of a product or service. Glossary

5-40 Return to slide Habitual decision making describes a purchase decision process in which consumers engage little conscious effort. Glossary

5-41 Return to slide Impulse buying is a buying decision made by customers on the spot when they see the merchandise. Glossary

5-42 Return to slide Involvement is the consumer’s degree of interest in the product or service. Glossary

5-43 Return to slide Limited problem solving occurs during a purchase decision that calls for, at most, a moderate amount of effort and time. Glossary

5-44 Return to slide Psychological needs pertain to the personal gratification consumers associate with a product and/or service. Glossary

5-45 Return to slide Retrieval sets are the brands or stores that can be readily brought forth from memory. Glossary

5-46 Return to slide Ritual consumption is a pattern of behaviors tied to life events that affect what and how we consume. Glossary

5-47 Return to slide Shopping goods/services are products or services for which consumers will spend time comparing alternatives. Glossary

5-48 Return to slide Situational factors are factors specific to the situation. Glossary

5-49 Return to slide Specialty goods/services are products or services toward which the customer shows a strong preference and for which he or she will expend considerable effort to search for the best suppliers. Glossary

5-50 Return to slide Universal sets include all possible choices for a product category. Glossary