1. Chapter 6 Social and Psychological Influences on Buyer Behaviour Copyright © 2001 by McGraw-Hill Ryerson Limited Sommers  Barnes Ninth Canadian Edition Presentation by Karen A. Blotnicky Mount Saint Vincent University, Halifax, NS

2. Copyright © 2001 McGraw-Hill Ryerson Limited 6 - 2 Chapter Goals To gain an understanding of: The process of consumer purchase decision making The importance of various information sources on buying decisions The impact on purchasing caused by reference groups, family, household, social class, culture, subculture, motivation, perception, learning, personality, attitudes, and situational factors

3. Copyright © 2001 McGraw-Hill Ryerson Limited 6 - 3 BUYING-DECISION PROCESS Need recognition Identification of alternatives Evaluation of alternatives Purchase and related decisions Postpurchase behaviour INFORMATION Commercial sources Social sources SITUATIONAL FACTORS When consumers buy Where consumers buy Why consumers buy Conditions under which consumers buy PSYCHOLOGICAL FORCES Motivation Perception Learning Personality Attitude SOCIAL AND GROUP FORCES Culture Subculture Social class Reference groups Family and households Copyright © 2000 McGraw Hill Ryerson Limited

4. Copyright © 2001 McGraw-Hill Ryerson Limited 6 - 4 The Buying-Buying Decision Process The consumer goes through a series of decision- making stages en route to a decision and beyond: 1. recognition of an unmet need 2. choice of an involvement level 3. identification of alternatives 4. evaluation of alternatives 5. purchase and related decisions 6. postpurchase behaviour

5. Copyright © 2001 McGraw-Hill Ryerson Limited 6 - 5 Variations in the Purchase Process the consumer can withdraw at any stage some stages may be skipped the stages are generally of varying length some stages may be performed subconsciously

6. Copyright © 2001 McGraw-Hill Ryerson Limited 6 - 6 Level of Involvement influences the amount of effort the consumer will devote to the purchase decision process involvement is higher when consumer lacks information about purchase product or service is considered important risk of a bad decision is perceived to be high product or service is socially important product or service has the potential to provide significant benefits

7. Copyright © 2001 McGraw-Hill Ryerson Limited 6 - 7 Identification and Evaluation of Alternatives search for alternatives may be limited to options close at hand or may be more extensive influenced by information available, confidence in the information, and expected benefit or value of additional information criteria,evaluation of alternatives is based on certain criteria, which vary in importance across consumers -- this is what make for the existence of market segments

8. Copyright © 2001 McGraw-Hill Ryerson Limited 6 - 8 The Purchase and Related Decisions decision to buy is only the beginning of a more complex decision process marketers must make it as easy as possible for the customer to make these decisions the additional decisions that have to be made include where to buy, how to pay for the purchase, how to take delivery, whether to buy the extended warranty, etc. patronage buying motivespurchase decision is influences by a series of patronage buying motives

9. Copyright © 2001 McGraw-Hill Ryerson Limited 6 - 9 Postpurchase Behaviour after a purchase, the consumer has learned a number of things that affect future purchases cognitive dissonancealso goes through a period of anxiety known as cognitive dissonance; consumer is not sure whether he or she has made the right decision dissonance is greater when price is high, when alternatives are similar, and when the purchase is perceived to be important consumers try to reduce dissonance by seeking positive reinforcement

10. Copyright © 2001 McGraw-Hill Ryerson Limited 6 - 10 Information Influencing Purchase Decisions There are two sources of information: commercial environment The commercial environment consisting of all marketing organizations and individuals who attempt to communicate with consumers. social environment The social environment, including noncommercial word-of-mouth communication and observation of others using products.

11. Copyright © 2001 McGraw-Hill Ryerson Limited 6 - 11 Cultural Influences on Behaviour buying decisions are influenced by social forces cultureculture has the most indirect impact; we are all products of a handed-down culture cultural influences change very slowly over time ethnic subcultures have a profound effect on how Canadians lead their lives the most obvious subcultural differences are between French- and English-Canadians, although many other ethnic subcultures exist

12. Copyright © 2001 McGraw-Hill Ryerson Limited 6 - 12 Multiculturalism in Canada Sub-cultures make for profitable market segments across Canada Notable ethnic markets include: Italian Portuguese Chinese German Middle and Eastern Europeans are clustered in the Prairie region Italian and Chinese populations are clustered in Toronto, Montreal, and Vancouver

13. Copyright © 2001 McGraw-Hill Ryerson Limited 6 - 13 The Quebecois Market The Francophone market differs from the Anglophone market in Canada and should be treated as distinct It is large enough to be considered a culture, rather than a sub-culture The French live across Canada, but the Quebec region is different due to: Size Homogeneity Purchasing power Social and political orientation

14. Copyright © 2001 McGraw-Hill Ryerson Limited 6 - 14 Social Class Influence social class social class represents an interesting way to look at a market; influenced by such factors as education, occupation, and place of residence may be used as a basis for segmenting markets, and may reflect the aspirations of consumers social classes exist whether people care to admit it or not; differences in beliefs and attitudes exist across class boundaries; and social class may be a better predictor of buyer behaviour than income

15. Copyright © 2001 McGraw-Hill Ryerson Limited 6 - 15 The Social Class System The Upper Class (2%) The Upper (Old Money) The Lower (New Rich) The Middle Class (45%) The Upper (12%) Moderately successful business people, professionals The Lower (32%) White collar workers, technicians, small business owners The Lower Class (54%) The Upper (38%) Blue collar (working class) The Lower (16%) Unskilled, chronically unemployed, welfare poor

16. Copyright © 2001 McGraw-Hill Ryerson Limited 6 - 16 Reference Group Influence reference groups are those with whom we interact and who influence our attitudes, values and behaviour reference groupssmall reference groups establish norms that influence purchase decisions, and their word-of-mouth is considered to be more powerful than advertising and other commercial forces familyhouseholdthe family and household are considered to be very influential reference groups

17. Copyright © 2001 McGraw-Hill Ryerson Limited 6 - 17 Psychological Factors Impacting Purchasing Motivation and Need Perception Learning Personality and Attitude

18. Copyright © 2001 McGraw-Hill Ryerson Limited 6 - 18 Motivation and Need Motivation, a need sufficiently stimulated that an individual is moved to seek satisfaction. Motives are either physiological or psychological. Many different motives are often involved in a purchase. Maslow presents a hierarchy of needs which helps us understand motivation.

19. Copyright © 2001 McGraw-Hill Ryerson Limited 6 - 19 SELF-ACTUALIZATION Needs for self-fulfillment ESTEEM Needs for self-respect, reputation, prestige, and status BELONGING AND LOVE Needs for affection, belonging to a group, and acceptance SAFETY Needs for security, protection, and order PHYSIOLOGICAL Needs for food, drink, sex, and shelter Maslow’s Hierarchy of Needs

20. Copyright © 2001 McGraw-Hill Ryerson Limited 6 - 20 Perception The process of receiving, organizing and assigning meaning to stimuli detected by the senses Impacted by selectivity: Selective attention —only those stimuli that capture and hold attention can be perceived. Selective distortion —consumers alter information that is inconsistent with their beliefs and attitudes. Selective retention —consumers retain only part of what they perceive.

21. Copyright © 2001 McGraw-Hill Ryerson Limited 6 - 21 Learning Changes in behaviour which result from observation or experience Responses to stimuli are learned as a result of rewards or punishments. Responses can become habits that replace wilful behaviour.

22. Copyright © 2001 McGraw-Hill Ryerson Limited 6 - 22 Personality and Attitude personalitypersonality is a pattern of traits that influence behaviour; but it is not always clear how personality affects consumption behaviour self-concepta consumer tends to act in a way that is consistent with his or her self-concept attitudeattitude is one of the most important concepts in understanding consumer behaviour; it is a learned disposition to act in a certain way attitudes are formed over time, are slow to change, and are excellent predictors of behaviour

23. Copyright © 2001 McGraw-Hill Ryerson Limited 6 - 23 Values and Lifestyles most valuable way of looking at a market and its potential psychographic research is considered to have transcended demographic categories

24. Copyright © 2001 McGraw-Hill Ryerson Limited 6 - 24 Situational Influences Five situations in which consumers find themselves often influence their purchase behaviour: time 1. consider how time affects the decision to buy physical surroundings 2. physical surroundings often influence purchases terms and conditions 3. the terms and conditions surrounding the actual purchase will influence the buying decision objectives 4. the consumer’s objectives are important physical condition and mood 5. the final buying decision is often influenced by the consumer’s physical condition and mood