1. Chapter 1 Understanding Consumer Behavior © 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

2. Learning Objectives~ Ch. 1 1. Define consumer behavior and explain the components that make up the definition. 2. Identify the four domains of consumer behavior shown in Exhibit 1.4 that affect acquisition, usage, and disposition decisions. 3. Discuss the benefits of studying consumer behavior. 4. Explain how companies apply consumer behavior concepts when making marketing decisions.

3. © 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Consumer Behavior The acquisition, consumption, and disposition of goods, services, time & ideas by (human) decision making units You do this multiple times a day Consciously & unconsciously Rationally & emotionally Influenced by advertising, social media, friends/family, celebrity, sport & marketing communications

4. © 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Consumer Behavior (CB) Reflects totality of consumer’s decisions with respect to the acquisition, consumption, & disposition of: −Good −Services −Time −Ideas by (human) Over time How does this relate to marketing strategies & tactics?

5. © 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. CB & Consumption Acquisition Usage Disposition Please think of each form of cb that you have done in the last 24 hours….

6. © 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Consumer Behavior Dynamic process Can involve many people Involves many decisions big & small Involves consumer feelings & coping The abcs of consumer behavior intertwine: −Attitude/affect −Behavior −Cognition

7. © 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. What Impacts Consumer Behavior? ① Psychological Core ② Decision-Making Process ③ Consumer Culture ④ Consumer Behavior Outcomes

8. © 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. ① Psychological Core Motivation, ability, & opportunity Exposure, attention, & perception Categorizing & comprehending information Forming & changing attitudes Forming & retrieving memories

9. © 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. ② Decision-making Process Problem recognition & search for information Judgments & decisions Post-decision evaluations

10. © 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. ③ Consumer Culture External Processes/Influences: Consumer diversity Social class & household Values, personality, & lifestyles Reference groups & other social influences

11. © 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. ④ Consumer Behavior Outcomes Symbolize who we are—external signs used to express identity Diffuse through a market—influence others’ decision making Ethics & corporate social responsibility (CSR)

12. © 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Important Aspects CB involves more than just products (e.g., going to the dentist, what TV programs to watch, taking aerobics class, going skydiving, donating to a cause, etc.) CB involves more than just buying: −Acquisition (leasing, trading, borrowing) −Usage (gives insight on symbolic aspects, usage patterns, new product ideas or improvements, W-O-M) −Disposing (recycling, product durability) CB is a dynamic process (sequence of events over time)

13. © 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Importance of CB to Marketing Managers Importance of being customer-focused Market segmentation: can group consumers by similar needs, wants, & attitudes −identify the most valued customers for marketing activities Customer relationship management (CRM): providing value & service to customers over time to build loyalty Positioning: niche in consumers’ minds − critical to success What company do you think does this best?