Consumer behaviour ramanuj majumdar

PHI Learning

UNDERSTANDING
CONSUMER BEHAVIOUR

Consumer Behaviour: Insights from Indian Market—Ramanuj Majumdar

1

PHI Learning

CONSUMER BEHAVIOUR

Consumer behaviour entails the
totality of consumer’s decision
involved in acquiring, consuming and
disposing of goods and services, as
well as making use of experiences
and ideas.


2

PHI Learning

Consumer Behaviour is a Complex Dynamic Process
Consumer’s Perspective

Marketer’s Perspective

Pre‐purchase
issues

Purchase
issues

Post‐purchase
issues

Each stage poses varied issues and offers subsequent challenges for the marketer.

3

PHI Learning

Pre‐purchase Challenges for the Marketer


4

PHI Learning

How are consumers’ attitudes towards products formed and/or changed?

Changing consumer
demographics
Access to more
choice of brands/
products

Consumer
behaviour

Cultural influences
on consumer
behaviour
The creation and
diffusion of
consumer culture

Psychological Factors
‐ Consumer involvement
‐ Consumer motivation
‐ Consumer’s perception
Personal Factors
‐ Personality and lifestyle
‐ Family lifecycle
Social Factors
‐ Reference groups
‐ Family

Consumer age,
sex, social class
Subcultures

It is essential for the marketer to understand how each of these factors influences consumer’s buying decision.
He can then formulate strategies in line with customer needs and demands.

5

PHI Learning

How do psychological factors affect the consumer’s purchase decision?

Changing consumer perception

Motivation—the secret of
energy

Learning‐Superior after‐sale‐service

Belief—TATA signifies trust


6

PHI Learning

How do personal factors affect the consumer’s purchase decision? (Contd.)

Lifestyle

Self Concept—“Definitely male”

Gender—Targeting the male

Age—Targeting the youth


7

PHI Learning

How do social factors affect the consumer’s purchase decision?

Reference Group—I‐bankers
Phone
Influence of Family

Status Symbol

8

PHI Learning

How do cultural factors affect the consumer’s purchase decision?

Subculture: Targeting the ‘Full of Life’

Targeting on the basis of Culture

Social Class

9

PHI Learning

What cues/inferences do consumer’s use to choose and infer which
brand/product is superior to others ?

The extent of information search depends on:
Motivation, ability and opportunity.
How extensive the search is for high involvement, high risk products.
Consumer demography and product type.
The marketer needs to select the right source for information to reach the
target consumer.

10

Various Sources of Information the Marketer can Tap
Radio
Transport

Events

Internet

Outdoor

SMS
Utilities

Gaming

Sport

Podcasts

TV

Magazines
Newspapers

Word‐of‐Mouth

Posters


Direct mailers

11

PHI Learning

Purchase Time Challenges for the Marketer


12

PHI Learning

How do situational factors affect consumer’s purchase decision?

When to purchase

Three Possibilities in
Consumer Purchase
Decision

Where to purchase

How to purchase

Influencing Factors:
Store atmosphere—Display, music, fragrance
Time pressure—Peak or off‐season
Pleasantness of shopping experience
Schemes

13

PHI Learning

Post‐purchase Challenges for the Marketer


14

PHI Learning

What determines whether a consumer will be satisfied with a brand choice and
whether he will buy it again?
After buying a product, the consumer compares it with his
expectations and is either satisfied or dissatisfied.
Satisfaction or dissatisfaction affects:
‐ Consumer value perceptions
‐ Consumer communications
‐ Repeat‐purchase behaviour

Marketers use various strategies to positively influence consumer’s Post‐purchase behaviour

Post‐purchase
Service

Feedback from
Consumer

Loyalty
Programmes

Advertisements


15

PHI Learning

Thank You ☺


16

PHI Learning

Consumer Motivation


17

PHI Learning

What is Motivation?
Motivation refers to an activated state of
needs within a person that leads to goaldirected behaviour.
Types of Needs
Innate or learned
Expressive (emotional)
Utilitarian (practical and functional)
Hedonistic


18

PHI Learning

Maslow’s Hierarchy of Needs


19

PHI Learning

Characteristics of Needs
Needs:
• Are dynamic.
• Have hierarchy.
• Can be internally and externally aroused.
• Can conflict.


20

PHI Learning

Motivational Conflict and
Need Priorities
Satisfying a particular need often comes at the
expense of another need.
These trade-offs cause motivational conflict.


21

PHI Learning

Types of Motivational Conflict
Approach-approach: deciding between two desirable
options
Avoidance-avoidance: deciding between two
undesirable options
Approach-avoidance: behaviour has both positive
and negative consequences.


22

PHI Learning

Consumer Motivation
• Represents the drive to satisfy both physiological
and psychological needs through product
purchase and consumption.
• It gives insights into why people buy certain
products. Stems from consumer needs: industries
have been built around basic human needs.


23

PHI Learning

Motivated Purchase…
• Conspicuous consumption: Purchases motivated
to some extent by the desire to show other people
how successful they are.
• Companies reinforce the consumer motivations
notion that products enable users to communicate
their social status.
• In general, marketers try to create an image or
personality for their brands.


24

PHI Learning

Motivation

Consumer Behaviour

Motivation signifies the processes that cause consumers to
behave as they do, involving needs, goals and drives.

25

PHI Learning

Model of the Motivation Process
Previous
learning

Unfulfilled
need, want
and desire

Tension

Drive

Behaviour

Goal/Need
fulfillment

Cognitive
processes

Tension
reduction


26

PHI Learning

Needs/Wants

Beliefs

A Model of Consumer Motivation

27

Emerging Trend

PHI Learning

• Skin care is increasingly
becoming more important to
men

Emotional Needs

• Years for success in his career
• Feels he deserves better
quality products.
• Tries to upgrade his lifestyle.

Key Influencers

• Celebrity endorsers
• Sportsmen (cricketers),
prominent businessmen
• WOM, friends

Likes

• Just bought his first new bike
(TVS Apache) and a new mobile
(Nokia N Series).
• Shops for clothes, shoes, etc. often
in malls and shopping complexes.
• Often eats out (with friends).
• Likes to visit pubs and discos.

Receptivity

• Online needs are high
• Low towards mass media
vehicles


28

PHI Learning

What are His Needs/Motivations?


29

PHI Learning

Maslow’s Hierarchy of Needs

Offline

Ability to develop skills and
fulfil one’s potential

Self-respect and ability to earn respect of
others & contribute to society

Ability to give and receive love; feeling
of belonging to a group

Protection from crimes; sense of
living in fair and just society

Food, clothing,
shelter, health

Online

SelfActualization
Self-Esteem

Ability to take on a community role that
develops skills and opens up new opportunities

Ability to contribute to the community and
be recognized for those contributions

Social

Security and Safety

Physiological

Belonging to the community as a whole
and to sub-groups within the community

Protection from hacking; ability to
maintain varying levels of privacy

Access to computer
and Internet

SOURCE: Amy Jo Kim’s Community Building on the Web (Peachpit, 2000)

30

PHI Learning

Motivational Intensity
Depends on: How strongly consumers are motivated
to satisfy a particular need.
Importance of
Involvement: Degree to which an object or behaviour
is personally relevant.
Motivational intensity and involvement determine
the amount of effort consumers exert in satisfying
needs.


31

PHI Learning

The Challenge of Understanding
Consumer Motivation
Reasons underlying consumer motivation are not always obvious.
Research is necessary to discover real motivations behind
behaviours.
Consumers at times do not always want to disclose real reasons
for their particular choice or actions.
Consumers do not always know why they do what they do:
unconscious motivation.
Motivations change over time.
Let us take an example of car buying and its underlying
motivations.

32

PHI Learning

Why Automobile?


33

PHI Learning

Automotive Sector
Classification of the Automotive Industry
• Commercial vehicles (Trucks and Buses)
• Passenger Cars and Multi‐utility vehicles
• Two‐wheelers
• Three‐wheelers
• Tractors
For explaining motivations , we will concentrate on
passenger cars and multi‐utility vehicles.


34

PHI Learning

Automotive Sector–Demand Drivers


35

PHI Learning

Means‐end Chains Structure
• Attributes: Descriptive features that characterize a
product.
• Benefits: Personal beliefs and meanings attached or
derived from various product attributes.
• Values: Stable and enduring personal goals.


36

PHI Learning

Issues a typical consumer considers
when he chooses a car
• Reliability/Durability
• Interior design and comfort

•

Fuel Efficiency or Mileage

•

Recommendation of peer group, Word
of Mouth (WOM) and dealers opinion

• Manufacturer’s reputation,
Brand  name and its value
• Exterior appearance and
aesthetics
• Petrol vs. Diesel model

about servicing and overall
performance.
•

Servicing and ‘the deal’ offered

•

Passenger and Luggage carrying capacity

•

Size, length, machine capacity

•

Price and Re‐sale Value of old car model
and  Terms of Payment


37

PHI Learning

Automobile Purchase: Demographic Factors
Family
life
cycle


38

PHI Learning

Committed/
recently married

Bachelor

Impact of family life cycle on
consumer need/preference
Married with
children


39

PHI Learning

Family Life Cycle


40

PHI Learning

Things do not change,
we change

.

HENRY DAVID THOREAU


41

PHI Learning

Let us unlock some key trends

42

PHI Learning

How the needs of the same consumer change
as he moves along the family life cycle…
Bachelorhood Married Married with
children Non‐dependent children


43

PHI Learning

Information Gathering
Talking to dealers
Talking to friends/Colleagues/Relatives
Inspecting the car
Car ads
Talking to mechanics
Car brochures/Articles/Programmes
Internet

44

PHI Learning

Study the various sources of information,
gather and find the reliability of various
information sources.


45

PHI Learning

Major Motivators/Triggers
Increasing family’s need
Need to travel long distance

Rational
Factors

Problem with old car
Status/Prestige

Emotional
Factors

Promotion
Peer pressure

46

PHI Learning

Integrative Choice: Purchase decision is
influenced by a mix of rational and
emotional factors.


47

PHI Learning

Social Influences
Combined effects of Occupation, Education and Income levels

Conspicuous and compensatory consumption trends

Certain norms and values are created by social influences.
So it is essential to find out how these social influences
(occupation, education and income etc.) affect the
consumer motivation in the purchase of an automobile.

48

PHI Learning

Sex

Men and women possess unique personality traits,
interests, knowledge and judgment capabilities.
Find out how the motivating factors differ based on the
gender of the consumer.

49

PHI Learning

Thank You.


50

PHI Learning

Consumer Perception
Consumer
Perception

51


PHI Learning

Perception is Reality
LOUIS CHESKIN

52


PHI Learning

Perception
Process by which sensations are selected,
organized, and interpreted
Adding meaning to raw sensations

53


PHI Learning

Elements of Perception
Sensation
Absolute threshold
Differential threshold
Subliminal threshold

54


PHI Learning

Sensation
Immediate response of our
sensory receptors…
…eyes, ears, nose, mouth,
fingers…
…to basic stimuli…
…such as light, colour,
sound, odour, and texture
…advertisements, brand
names, commercials, and
packages
…depends on the sensitivity of
the individual
55


PHI Learning

The Absolute Threshold
The lowest level at which an individual can
experience a sensation.
The point which differentiates between
“something” and “nothing”.
Example: Absolute threshold of driver driving
on highway to notice billboard.
Adaptation: Getting ‘used to’ certain sensation.
56


PHI Learning

Attention
The extent to which processing
activity is devoted to a particular
stimulus
Competition for our attention
3,500 ad info pieces per day
Multitasking
Marketers need to break through
the clutter
Microsoft’s butterfly decals on
sidewalks
3D logos on cricket grounds
57


PHI Learning

The Differential Threshold
The minimal detectable difference between two
similar stimuli (just noticeable difference).
It’s not at all the absolute difference.
It’s an amount relative to the intensity of the first
stimulus.
The stronger the initial stimulus, the greater the
additional intensity needed for second stimulus to be
perceived as differentiated.

58


PHI Learning

Marketing Applications of the JND
Need to determine the
relevant JND for the products
so that
negative changes are not
readily discernible to the public.
product improvements are
quite visible to consumers.

59


PHI Learning

Gradual Changes in
Brand Name

60


PHI Learning

Subliminal
Perception

Perception of very weak or
rapid stimuli received below
the level of conscious
awareness

61


PHI Learning

Perceptual Selection
Stimulus Selection Factors
Weber’s Law
Differences in size, colour, position, and novelty
Interpretation: assigned meaning to stimuli
Schema leads to stimulus evaluation

62


PHI Learning

Weber’s Law

A theory concerning the
perceived
differentiation
between similar stimuli of
varying intensities (i.e. the
stronger the initial stimulus,
the greater the additional
intensity needed for the
second stimulus to be
perceived as different).
63


PHI Learning

Perceptual Selection
Depends on two major
factors
Consumers’ previous
experience (expectations)
Consumers’ motives

64


PHI Learning

Some Marketing Variables
Influencing Consumer Perception
Nature of the product
Physical attributes of the
product
Package design
Brand name
Advertisements and
commercials
Position of an ad
65


PHI Learning

Concepts Concerning Selective Perception

Selective exposure
Selective attention
Perceptual defense
Perceptual blocking

66


PHI Learning

Stimulus Organization
• Stimulus interpretation is associated with other
related events, sensations, or images
• Gestalt: “The whole is greater than the sum of its
parts”.
• The Closure Principle—People tend to perceive
an incomplete picture as complete.
• The Principle of Similarity—Groups objects share
similar characteristics.
• The Figure–Ground Principle—One part of the
stimulus will dominate (the figure/background).
67


PHI Learning

Gestalt Laws of Grouping
• The primary purpose of the visual system is the
recognition of objects from basic visual elements.
• The objects are seen as more than a sum of the parts,
and the critical problem facing the visual system is how
to group the elements to form objects.

68


PHI Learning

Demonstration of the Importance of
Objects over Elements
When elements are arranged in groups that define an object,
we tend to see the object and not the elements.

FFFFFFF
FF
FFFF
FF
FFFFFFF

vs.

EEEEEE
EE
EEEE
EE
EEEEEE
69


PHI Learning

Law of Proximity
Things that are relatively close to one another tend to be
grouped together.

70


PHI Learning

The Law of Similarity
Items that look similar will be seen as parts of the same form.

71


PHI Learning

The Law of Good Continuation
The tendency to perceive unseen parts of a pattern as
continuing in a predictable and simple manner.

72


PHI Learning

The Law of Closure
Often, an object is partly occluded by other objects in our
environment, and the visual system must fill in the
missing information.

73


PHI Learning

A Related Phenomenon Illusory Contours

74


PHI Learning

The Law of Common Fate
Elements of visual perception that move together
are seen as forming a common object.

75


PHI Learning

Common Fate Example - 1

76


PHI Learning


77


PHI Learning


78


PHI Learning


79


PHI Learning

Figuring out what the objects are
The Gestalt principles help us to understand how we
figure out what the objects are, and how to interpret them.
However, they do not explain how we figure out what an
object is once we realize it is an object.

80


PHI Learning

Figure and Ground

81


PHI Learning

The Figure-Ground Principle

• This billboard for Wrangler jeans makes creative
use of the figure-ground principle.
82


PHI Learning

Perceptual Positioning
Brand perceptions
=functional attributes + symbolic attributes
Perceptual map
Company’s own strengths and weaknesses in
comparison with competitors

83


PHI Learning
Excellent product
quality

Perceptual Map

High
value for
money

Low
value for
money

Low product
quality
84


PHI Learning

Thank You

85


PHI Learning

86


PHI Learning

Consumer Perception
Consumer selects, organizes and interprets stimuli
into a meaningful and coherent picture of the world.
How we view the World around us!
Consumers make decisions based on what they
perceive rather than what the objective reality is.
Consumers see what they want to see!

87


PHI Learning

Elements of Perception
Sensation: Stimuli and Intensity
Absolute threshold (e.g. seeing an ad)
Sensory adaptation (Phenomenon of getting used to),
e.g. change ad campaigns, package
Differential threshold JND (Weber’s Law); product
improvement decisions
Negative changes (Price rise, size, quality reductions,
etc.)

88


PHI Learning

Selective Perceptions
Nature of the stimulus: What you want to see is based
on what your motives are at that time.
Selective exposure: Pleasant ads
Expectations and previous experience

89


PHI Learning

Perceived Risk
An uncertainty arises when consumers cannot
foresee the consequences of their purchase decisions.
Depends on the person,the product, and the purchase
situation.
High risk perceivers categorized as narrow
categorizers.

90


PHI Learning

Broad Categories
Product category perceived risk, e.g. to buy a digital
camera or not.
Product specific perceived risk, e.g. which brand of
camera to buy.

91


PHI Learning

Types of Perceived Risk
Functional risk: The risk that the product will not
perform as expected.
Will the cell phone I bought work for the given
warranty period?
Physical risk: The risk to self and others that the
product may pose .
Will the cell phone damage my health? Is it safe to
use?

92


PHI Learning

Financial risk: The risk that the product will not
be worth its price.
Will the price of mobile/laptop drop after I buy it?
Social risk: The risk that a poor product choice
may result in some form of social embarrassment.
Will my mobile look like an outdated model?

93


PHI Learning

Psychological risk: The Risk that a poor product choice
will bruise the consumer’s ego.
After buying this product, will my peer group members
laugh that it is a wrong choice?
Time risk: The risk that the time spent in product search
may be wasted if the product does not perform as
expected.
I have spent so much time in buying a new camera/laptop.
Was it worth or a waste of time?
94


PHI Learning

How Customers Handle Risk
Seek information,
word of mouth, newspapers
Buy known brands/become loyal,
e.g. buy Annapurna Atta.
Select by Company/Brand image,

e.g. buy Sony TV / Nokia Cell phones.

95


PHI Learning

How Customers Handle Risk (cont.)
Rely on Store image, e.g. buying from known shops.
Buy the most expensive model.
Seek reassurance
(money‐back guarantees, pre‐purchase trial, warranty
period).

96


PHI Learning

Application of the Concept
Find out the nature of risk customers perceive before
purchasing new products.
Remove the nature of anxiety of customers.

97


PHI Learning

Thank You
98


PHI Learning


99

PHI Learning

Consumer
Beliefs
Consumer
Attitudes

Consumer
Intentions

Consumer
Behaviour

Consumer
Feelings


100

PHI Learning

Beliefs are the knowledge and inferences that a consumer has
about products/brands and possible benefits derived from using
them.
Beliefs result from cognitive learning.
Attribute importance springs from:
A person’s assessment of the significance of an attribute.
The amount of attention directed to it.
A person’s self-concept, advertising, and the salience of the
attribute can influence the attention focussed on it.


101

PHI Learning

Brand distinctiveness: Consumer perception of a brand and
company’s
marketing effort leads to developing certain
personality of each brand, e.g. Tanishq Jewellery.
Inferential beliefs: Information about one product of a company
makes consumers to form belief about another, price-quality
beliefs, partially comparative pricing, e.g. Akai TV, Big Bazaar
retail.
Consumer confusion: Insufficient/conflicting information,
mistaken identity, irrelevant ad slogan/appeal, change in the
brand’s key focus and positioning, e.g. Marie biscuits (Britannia,
Parle).

102

PHI Learning


103

PHI Learning


104

PHI Learning

Beliefs
Companies or Retailers mark up prices before
putting them up on sale.
Discounts offered by reputed companies are
genuine reduction in prices.

Examples
Bargaining behaviour
Wait for the discount
announcement

Celebrities are admired by their followers though Success of soaps and
they do not use the product they endorse.
cosmetics
Lower price generally means inferior quality.
Higher priced brands are not superior in quality
by the same degree of multiplier.

Positioning at a lower quality
end, as done by Haier,
Lenovo

Shopping in a big departmental store saves
money.

Big Bazaar, Subhiksha

Packaged ready-to-eat food items marketed in
India are generally not fresh.

Limited success of MTR, ITC
foods


105

PHI Learning

As part of “Advertising Experience”: Influence on viewers’
moods, attitudes, recall, affinity,
Examples: Hamara Bajaj Campaign, Amul Butter—“Utterly, butterly
delicious”
As part of “Shopping Experience”: Influence of availability,
“environment/ambience”
Examples: Maruti service centres, Cafe’ Coffee Day, Brista coffee
As part of “Consumption Experience”: Influence consumers’
consumption evaluation
Examples: Vanilla Coke, Blue Pepsi, Asian Paints


106

PHI Learning


107

PHI Learning

“Desirable Attributes create positive attitudes”
Example: Health drinks
Attitudes are:

a kind of feeling for or against a stimulus;
stored in long-term memory;
the cognitive knowledge about an object;
predicted by beliefs in high involvement purchase
situations.


108

PHI Learning


109

PHI Learning


110

PHI Learning


111

PHI Learning

Utilitarian function: Used to obtain rewards and avoid
punishments
Ego-defensive function: Self-protection
Example: mouthwash
Knowledge function: Simplifies decisions
Example: Forming of loyalty to certain brands
Value-expressive function: Expresses identity to
others
Example: use of (IIM-C) labelled t-shirts


112

PHI Learning

Direct formation
Corresponds to the decision-making perspective and
cognitive learning.
Linked to the experiential perspective.
Classical conditioning/Associative learning: Positive
affect is attached to object–using a jingle.
Mere exposure—frequent exposure to stimulus
increases one’s desire for it.
Environmental forces
Example: design of the physical environment, cafes


113

PHI Learning

Decision-making hierarchies:
High involvement: beliefs
Low involvement: beliefs
Experiential hierarchy:
Affect
behaviour

attitudes
behaviour

behaviour
attitudes

beliefs

Behavioural influence hierarchy:
Behaviour
beliefs
affect


114

PHI Learning

Changing beliefs: Comparative advertising
Example: Sugar Free, Saffola oil (less cholesterol)
Changing attribute importance: Identification of new,
improved attributes
Example: Washing powders, soaps
Changing ideal points


115

PHI Learning


116

PHI Learning


117

PHI Learning

=

BI
A
SN

act

A
=
=

act

∑
∑

+ SN
i
j

b ie
NB

i
j

MC

j


118

PHI Learning


119

PHI Learning

Changing Consumer Attitudes: Changing
Beliefs
Firms hope that changing beliefs about products will result in more
favourable product attitudes and influence what consumers buy.
If beliefs are false, they should be brought into harmony with
reality and then stabilized and reinforced.
If beliefs are accurate, it may be necessary to change the product.
Comparative advertising can hurt beliefs about a competitive
brand


120
120

PHI Learning

Attribute Importance
Changing an attribute’s importance is more difficult than
changing a belief.
How is a brand perceived relative to ideal performance?
Increasing attribute importance is desirable when the
competitor’s brand is farther from the ideal point than
your product.
Firms may add a new attribute which necessitated NPD or product
revision.

121
121

PHI Learning

Ideal Points

Altering consumers’ preferences for
what the Ideal product should look like.

It is far more difficult than any other
approach in changing consumers,
attitudes toward brand and product.


122

PHI Learning

The best way to capture customer is to adjust
with his or her desirable situation and
favourable attitudes.


123

PHI Learning

Post-purchase
Action

Attitude
Learning

Sequential model of
purchase and repurchase
behaviour in marketing

Perception
Attention
Exposure


124

PHI Learning


125

PHI Learning

Consumer Behaviour

Involvement & Emotion

126


PHI Learning

Consumer Involvement
Cars
Furniture

Apparels
Perfume

Toothpaste
Salt

127


PHI Learning

Involvement
What is Involvement ?
Perceived relevance of the object of consideration based on
inherent needs, values and interests
A general level of interest in or concern about an object or
activity without reference to a specific position

Types of Involvement
Situational (Purchase-Decision) Involvement
The level of concern/care the consumer brings to bear on a
particular purchase decision
Enduring Involvement
The level of interest the buyer maintains for a class of
product/activity, well beyond the specific purchase
situation

128


PHI Learning

Involvement (Cont.)
Enduring involvement is related to the way one
views oneself and is often linked to Family,
Group and Lifestyle (Psychographic) variables.
Perceived risk is related to purchase
involvement.
In Low Involvement situations:
In High Involvement situations:
Behaviour

Attitudes

Attitudes

Behaviour
129


PHI Learning

Purchase Involvement
Is Effected by:
The Product
Class

The Individual

Involvement
The Situation

Communication
130


PHI Learning

Consumer Product Involvement
Consumer Characteristics
• Social concepts
• Personality needs
• Expertise
Intrinsic Self-relevance
(Goals and Values)

Product Characteristics
• Time commitment
• Price
• Symbolic meanings
• Potential for harm
• Potential for poor performance

Situational context
• Purchase situation
• Intended-use situation
• Time pressure
• Social environment
• Physical environment

INVOLVEMENT

Interpretation
and
Integration process

Situational Self-relevance
(Consequences and Values)

131


PHI Learning

Means-End Basis for Involvement

PRODUCT KNOWLEDGE

SELF KNOWLEDGE

132


PHI Learning

Enduring Involvement Characteristics
High

Low

Many Attributes
Evaluated

Attributes are less
important (very few used)

Narrow Latitude of
Acceptance

Wide Latitude of
Acceptance

Small Evoked Set

Large Evoked Set

True Brand Loyalty

Spurious Brand Loyalty
133


PHI Learning

Enduring Involvement Characteristics
High

Low

Central Route Arguments

Peripheral Route Arguments

Substantive Messages
(reduce counter-arguments)

Reminder Ads and Ads with
Little Substance

Fewer Ads but packed with
Information

Frequent Ads–Little or no
Content–only a few points

Price may be Relatively Less
Important

Price may be Relatively Less
Important

Info Search is Active.

Info Search is Passive.


134

Low Involvement

PHI Learning

Selective

Problem Recognition

Information Search

Internal
(Limited)

Analysis of
Alternatives

Purchase Decision

No Dissonance

Post-Purchase
Behaviour


135

PHI Learning

Medium Involvement
Generic

Problem Recognition

Information Search

Few
Simple

Internal
External
(Limited)

Analysis of
Alternatives

Purchase Decision

Post-Purchase
Behaviour

No Dissonance


136

PHI Learning

High Involvement
Generic

Problem Recognition

Information Search

Many
Complex

Internal
External

Analysis of
Alternatives

Purchase Decision

Post-Purchase
Behaviour

Dissonance


137

PHI Learning

Effect of Product Knowledge and
Involvement in Decision Making
INVOLVEMENT
LOW

HIGH

Adequate product
at minimum effort

Choose the
best product.

Very few concrete
attributes

Unclear about
criteria.

Motivation

Satisfactory
product

Optimize satisfaction.

Choice Criteria

Very few abstract
criteria

Use many search
and decision tools.

Motivation
KNOWLEDGE

LOW
Choice Criteria

HIGH


138

PHI Learning

Creative Tactics
INVOLVEMENT

MOTIVATION

LOW

INFORMATIONAL
(–ve)

TRANSFORMATIONAL
(+ve)

Provide one or
two clear
benefits.

Emotional
authenticity of
execution and
liking the Ad.

HIGH

Provide believable information.
Don’t overclaim.

Consumer must personally
identify with feelings created.


139

PHI Learning

High Enduring Involvement Customers
Develop product class, brand expertise.
Search for information in an ongoing manner.
Take special interest in product care.
Augment/upgrade products; purchase “ad-ons” and
complementary products.
Become opinion leaders/brand advocates; build close
bonds with the company.
May participate in new product idea generation.


140

PHI Learning

A Model of Emotion-driven Choice

Symbolic
meaning of
consumption
Self

Pride
Status
Anxiety

Social

Motivation

Preference formation

Justification


141

PHI Learning

The Psychology of a BRAND
Domain

BRAND

CONSUMER

Symbolic meaning

Social language of
the Brand
Self-enhancement
Self-Image

Personality
Authenticity

Transformation of
experience

Reassurance

Safe choice

Emotional Realm

Easy choice
Functional Realm

Keeping promises of
performance

Certainty in an
uncertain world
Replication of
satisfaction
142


PHI Learning

Brand Strategy Alternatives
High Involvement

Symbolic
Brands

Cognition

Emotions
Functional
Brands

Low Involvement
143


PHI Learning

Brand Trust and Confidence
Risk
Perception

Symbolic Brands

Functional Brands

144


PHI Learning

Positioning a Brand
Why?

For whom?

When?

Against whom?

145


PHI Learning

Brand Identity Prism
Picture of the Sender

y
Ph

e
iqu
s

Pe
rs

Relationship

Re
fle

ctio
n

on
ali t
y

Culture

Se

e
ag
m
lf-I

Picture of the Recipient
146


PHI Learning

Building a Brand in Consumers’
Mind-space
Trust

Pe

rce

pti
on
o

fQ
ua

lity

Bra
nd
A

wa
re

147

ne
ss


PHI Learning

Thank You

148


PHI Learning

Consumer
Learning
Dissonance
and
Experience

149

PHI Learning

Consumer Learning
• It is the cognitive process of acquiring skill and
knowledge; learning is the acquisition and
development of memories and behaviours,
including skills, knowledge, understanding,
values, and wisdom.


150

PHI Learning

Importance of Learning
• Marketers must teach consumers:
where to buy
by whom and for whom the purchase is to be done
how to use, feel and perceive the product
how to maintain the product
how to dispose of products


151

PHI Learning

Learning Taxonomy

Learning

152

PHI Learning

Learning Theories
Behavioural Theories
Theories based on the
premise that learning
takes place as a result of
observable responses to
external stimuli. Also
known
as
stimulus
response theory.

Cognitive Theories
A theory of learning based
on mental information
processing, often in
response to problem
solving.


153

PHI Learning

Learning Processes
Intentional
Incidental
Learning acquired as a Learning acquired by
result of a careful accident or without
search for information. much effort.


154

PHI Learning

Elements of Learning Theories
1.
2.
3.
4.

Motivation
Cues
Response
Reinforcement
•
•
•
•

Stimulus
Drive
Response
Reinforcement


155

PHI Learning

Reinforcement

A positive or negative
outcome that
influences the
likelihood that a
specific behaviour will
be repeated in the
future in response to
a particular cue or
stimulus.


156

PHI Learning

Stimulus
Generalization

The inability to
perceive differences
between slightly
dissimilar stimuli.


157

PHI Learning

Reinforcement
Positive
Reinforcement
Positive outcomes that
strengthen the
likelihood of a specific
response
Example: Ad showing
beautiful hair as a
reinforcement to buy
shampoo

Negative
Reinforcement
Unpleasant or negative
outcomes that serve to
encourage a specific
behaviour
Example: Ad showing
wrinkled skin as
reinforcement to buy skin
cream


158

PHI Learning

Other Concepts in Reinforcement

• Punishment
– Choose reinforcement rather than punishment.

• Extinction
– Combat with consumer satisfaction.

• Forgetting
– Combat with repetition.


159

PHI Learning

Observational
Learning

A process by which
individuals observe the
behaviour of others, and
consequences of such
behaviour. Also known
as modelling or vicarious
learning.


160

PHI Learning

Components Of Observational Learning

Attention

Retention

Production
Process

Motivation

Observational Learning


161

PHI Learning

Cognitive
Learning
Theory

Holds that the kind
of
learning
most
characteristic of human
beings is problem
solving, which enables
individuals to gain
some control over their
environment.


162

PHI Learning

Classical
Conditioning

A behavioural learning
theory, according to
which a stimulus is
paired with another
stimulus that elicits a
known response which
serves to produce the
same response when
used alone.


163

PHI Learning

Models of Classical Conditioning


164

PHI Learning

Instrumental
(Operant)
Conditioning

A behavioural theory of
learning based on
trial-and-error process,
with habits forced as the
result of positive
experiences
(reinforcement)
resulting from certain
responses or behaviours.


165

PHI Learning

Operant Conditioning (Cont.)
is the process in which the frequency of
occurrence of a bit of behaviour is modified by
the consequences of the behaviour.
If positively reinforced, the likelihood of the
behaviour being repeated increases.
If punished, the likelihood of the behaviour
being repeated decreases.

166

PHI Learning

Operant (or instrumental) conditioning (Cont.)

Stimulus
Response
Reward

Can you explain
habit?

Reinforcement


167

PHI Learning

Instrumental (Operant) Conditioning (Cont.)

Reinforcement

Behaviour

Likelihood
Of Behaviour

Negative
Reinforcement

NOT the
same thing!
Punishment

Likelihood
Of Behaviour


168

PHI Learning

Reinforcement: An Example
You eat a cake (behaviour)
‐‐‐‐> Delicious (reward)
‐‐‐‐> more likely to eat more
cakes on other occasions


169

PHI Learning

Extinction
Behaviour which is not
reinforced tends to
become extinct
gradually.


170

PHI Learning

Ehrenberg

ATR

Model

Awareness
Trial

Reinforcement

Repeat purchase

Advertising
Note: The thicker (darker) lines denote the
major effects.


171

PHI Learning

Trial
Learning/Experience

Behavioural
Loyalty

Repeat purchasing
Commitment
Involvement

Attitudinal
Loyalty

Loyalty


172

PHI Learning

Brand Loyalty vs. Habit
• Habit: the consumer picks
product without much
thought, perhaps for
convenience.
• Loyalty: the consumer
actively seeks the product.


173

PHI Learning

Brand Loyalty

Function of Three Groups of Influences
1. Consumer drivers
2. Brand drivers
3. Social drivers

Four types of loyalty
1.
2.
3.
4.

No loyalty
Covetous loyalty
Inertia loyalty
Premium loyalty

174

PHI Learning

Developing Brand Loyalty: Tricks and Traps
1. Product quality ‐‐‐> satisfaction
2. Sales promotions
3. Stealing loyal consumers away from
others
4. Price
– value
– exclusiveness


175

PHI Learning

Memory
• Short term (compare to RAM ‐‐> volatile)
– mnemonic devices

• Long term (compare to hard disk ‐‐> longer
in duration but imperfect—“I remember it
well…”)

STM

REHEARSAL

LTM

DECAY

176

PHI Learning

Retention
Information is stored in
long‐term memory
Episodically: by the order
in which it is acquired
Semantically: according to
significant concepts
Total package of associations
is called a schema.

177

PHI Learning

Role of Memory in Learning

Stages
1. Encode
2. Storage
3. Decode and retrieval


178

PHI Learning

Recognition vs. Recall
Recognition
Remembering with stimulus
Recall/Retrieve
Remembering without stimulus


179

PHI Learning

The Cycle of Remembering
Learning

Short-term
Memory

Long-term
Memory

Retrievall


180

PHI Learning

The consumer
observes a positive
response by two
teens.


181

PHI Learning

Information Processing

• Relates to cognitive ability and the complexity
of the information.
• Individuals differ in imagery–their ability to
form mental images, which influences recall.


182

PHI Learning

Information Processing and Memory Stores


183

PHI Learning

Information Processing

• Movement from short‐term to long‐term
storage
depends on:
• Rehearsal—cognitive practice
• Encoding—memory’s associations or the way
information is stored.


184

PHI Learning

Experiential Marketing
Identity Related
Logo/Names
(NIKE)

Product Presence
Design/Packaging
(FRAGRANCES)

Co‐Branding
Events/Sponsorships
(FEMINA MISS INDIA)

Communication/
Advertising
(TASTE OF INDIA)

Experiential Marketing

Website/Electronic
Media
(ENCYCLOPEDIAS)

Spatial Environment
Retail/Office
(BARISTA)


185

PHI Learning

Consumers Dissonance


186

PHI Learning

Cognitive Dissonance
• Psychological discomfort caused by
inconsistencies among a person’s beliefs,
attitudes, and actions.
• Varies in intensity based on importance of issue
and degree of inconsistency.
• Induces a “drive state” to avoid or reduce
dissonance by changing beliefs, attitudes, or
behaviours and thereby restore consistency.

187

PHI Learning

Why the Dissonance?


188

PHI Learning

Causes of Dissonance
Performance risk
Physical risk (wear‐out)
High financial commitment
High involvement level
High social visibility
Information overload


189

PHI Learning

Is the Grass Greener on
the Other Side?
• Dissonance–predominantly post‐purchase behaviour
• Lack of confidence (doubts) about the correctness of a
prior purchase decision and efforts to reconcile doubts
Did I do the right
thing?


190

PHI Learning

Reactions to Dissonance
• The Consumer eliminating or re‐evaluating one of the cognitive
elements, or his responsibility, or control over the act or decision.
• Information can be denied or distorted or forgotten in the service
of dissonance reduction.
• Minimizing the importance of the issue or decision that led to the
dissonant state.
• New cognitive elements can be added to support the decision.
• Potential Reactions
• Return the product.
• Seek confirmatory information.


191

PHI Learning

Thank You.


192

PHI Learning

Communication and
Consumer Behaviour


193

PHI Learning

Direct Communication


194

PHI Learning

What is Communication?
A tool used by marketers to persuade consumers
to act in a desired way.
Transmission of message from a sender to a
receiver via a medium of transmission.
Modern technology is inducing tremendous
change in mass communication media.


195

PHI Learning

Basic Communication Model:


196

PHI Learning

The Sender
Initiator of a communication
Formal source–organization
Informal source–A close friend, peer group or
relative who provides information or advice.


197

PHI Learning

The Receiver
A targeted prospect or a customer
Every receiver interprets the message in his/her
own perceptions and experiences.
Intermediary receivers–Those who would specify
or prescribe the marketer’s products (Wholesalers,
retailers and distributors).
Unintended receivers–Shareholders, creditors,
suppliers, employees, bankers, and the local
community.


198

PHI Learning

The Medium
The communications channel
Impersonal–a mass media
Interpersonal–Formal or Informal
Formal–between a marketer’s agent (sales person)
and a customer
Informal–between two or more people by mail, etc.

Classification of mass media
Print (Newspapers, magazines, billboards)
Broadcast (Radio, television)
Electronic (Internet )

199

PHI Learning

Social Media: Definition
Social media describes the online technologies and
practices that people use to share opinions, insights,
experiences, and perspectives with each other.
Social media can take many different forms, including
text, images, audio, and video.
Popular social media include blogs, message boards,
podcasts, wikis, and vlogs.


200

PHI Learning

Simply put:
“Social Media refer
to people having
communication
online.”


201

PHI Learning


202

PHI Learning

The Message
Verbal
Spoken or written
Has more product specific information.

Non-verbal
A photograph, an illustration or a symbol
Stays in the mind of a customer for long.

Generally a mix of verbal and non-verbal message
is preferred.


203

PHI Learning

Feedback
Permits the sender to reinforce, to change or to
modify the message so that it is understood in the
intended way.
Common forms of feedback
Body language
Facial gestures
Verbal feedback

Feedback is essential and difficult to obtain in
impersonal communication.


204

PHI Learning

The Communication Process
Communication process involves the:
Sender
Receiver
Medium
Message
Target Audience (the receivers)
Feedback–the receiver’s response


205

PHI Learning

Comprehensive Communication Model


206

PHI Learning

The Message Initiator (Source)
Issues with
Credibility
Credibility of Informal
Sources
Credibility of Formal
Sources
Credibility of
Spokespersons and
Endorsers
Message Credibility

Sources include word of
mouth.
These sources are also
called opinion leaders.
Informal sources may
not always be credible.


207

PHI Learning

Issues with
Credibility

Sources
Sources
Credibility of Spokespersons
and Endorsers
Message Credibility

Neutral sources have the
greatest credibility.
Source credibility judged on
past performance, reputation,
service, quality, spokesperson’s
image, retailers, and social
responsibility.
Institutional advertising used
to promote favourable company
image.


208

PHI Learning

Issues with
Credibility
Sources
Sources
Credibility of
Spokespersons and
Endorsers
Message Credibility

Effectiveness related to:

The message
Synergy between the
endorser and the type of
product
Demographic characteristics
of the endorser
Corporate credibility
Endorsement wording


209

PHI Learning

Maria Sharapova for Nike


210

PHI Learning

Issues with
Credibility
Sources
Sources
Credibility of
Spokespersons and
Endorsers
Message Credibility

Credibility of retailers
Reputation of the medium
that carries the ad
Consumer’s previous
experience with product


211

PHI Learning

The Target Audience (Receivers)
Personal characteristics and comprehension
Involvement and congruency
Mood
Barriers to communication
Selective exposure to messages
Psychological noise


212

PHI Learning

Feedback—Receiver’s Response
Feedback should be gathered:
Promptly
Accurately


213

PHI Learning

Advertising Effectiveness Research
Media and message exposure measures:
How many consumers received the message.
Which consumers received the message.


214

PHI Learning

Advertising Effectiveness Research
(Cont.)

Message Attention and Interpretation
Physiological measures
Theater tests
Attitudinal measures

Message Recall Measures
Day-after recall


215

PHI Learning

Designing Persuasive Communications
Communications strategy
Must include objectives.
Includes cognitive models.
Newer models include perception, experience, and memory.

Target Audience
Segmentation is the key.

Media Strategy
Consumer profile
Audience profiles

Message Strategy
Involvement theory
– Central and peripheral routes

216

PHI Learning

Message Structure
and Presentation
Resonance
Message framing
Comparative
advertising
Order effects
Repetition

Wordplay
Used to create a double
meaning when used
with a relevant picture


217

PHI Learning

Word Play
An ad with word play
used for signifying the
need to save water.


218

PHI Learning

Word Play on SUV


219

PHI Learning

Message Structure and
Presentation
Resonance
Message framing
Comparative advertising
Order effects
Repetition

Positive framing
Negative framing
One-sided vs. two-sided


220

PHI Learning

(Contd.)
Presentation
Resonance
Message framing
Order effects
Repetition

Marketer claims product
superiority over another
brand.
Useful for positioning.


221

PHI Learning

Presentation

(contd.)

Resonance
Message framing
Order effects
Repetition

Primacy
Recency
Order of benefits
Brand name


222

PHI Learning


(contd.)

Presentation
Resonance
Message framing
Order effects
Repetition

Important for learning


223

PHI Learning

Emotional Advertising Appeals
Fear
Humour
Abrasive advertising
Sex in advertising
Audience participation


224

PHI Learning

Ads with Humour


225

PHI Learning


226

PHI Learning


227

PHI Learning

Messages with Fear


228

PHI Learning


229

PHI Learning


230

PHI Learning

THANK YOU.


231

PHI Learning

Consumer Personality


232

PHI Learning

Personality Selection
Psychological

Target Segment

Functional

Brand Personality

Product

Economic


233

PHI Learning

Brand Personality
Personality created to appeal target customers
Association with brand:
Character/Personality
Emotional

Positioning of brand:
Social
Values

Benefits provided:
Attributes
Quality


234

PHI Learning

Dimensions

Source: Dimensions of Brand Personality by Jennifer L. Aaker

235

PHI Learning

Consumer Expectations
Product

Expectations

Clothes

Sharp appearance, Style, Attractiveness, Comfort, Ruggedness

Cars

Comfort, Value for money, Social status, Family product, Performance

Mobile Phone

Durability, Style, Social status

Insurance

Peace of mind, Secured future

Cellular Service

Connectivity, Closeness to loved ones

Computer

Pleasure, Profits from miracle of modern technology

House

Comfort, Contentment, Good investment, Pride of ownership


236

PHI Learning

Components of Brand Personality
Brand Name & Logo
Colour & Packaging
Advertisement (including Brand Ambassador)
Price
Performance


237

PHI Learning

Personality-Colour Association
Respect
Authority

Caution
Novelty
Temporary
Warmth

Regal
Wealthy
Stately

Sophistication
Power
Authority
Secure
Natural
Relaxed
Human
Exciting, Hot
Strong
Passionate
Informal
Masculine
Nature

Powerful
Affordable
Informal
Purity
Cleanliness
Delicacy
Formality


238

PHI Learning

Brand Names
Red Bull, Power Horse – Energy Drinks
Himalayan – Mineral Water
Le Bon – Cheese
Twinings—Darjeeling Tea
Puma – Footwear
Dove – Bathing Soap


239

PHI Learning

Thank You ☺


240

PHI Learning


241

PHI Learning

Role of Age
Consumption

Perception

Behaviour
Learning

Choice

CONSUMER
Knowledge

Preference

Ideology

Intuition


242

PHI Learning


243

PHI Learning


244

PHI Learning


245

PHI Learning


246

PHI Learning


247

PHI Learning


248

PHI Learning


249

PHI Learning

Increased Spending by Young
Unmarried Employees


250

PHI Learning

Tech savvy

Adults

Convenience

Shift from “value for
money” to lavish lifestyle

Stylish looks and features

251

PHI Learning

“Protection from germs”: Economical without sacrificing the quality

252

PHI Learning

Higher Spending by Middle–aged
People and Senior Citizens


253

PHI Learning

Feeling and looking
good

Old

Convenience

Shift focus from “saving for children”
to enjoying their own life

Stylish looks and features

254

PHI Learning

People Change by Age


255

PHI Learning

Age-specific Targeting

Target kids, adults and older consumers with different
set of products
Customers classification–new born (0-1month), infant
(2–5 months), cruiser (6-12 months), toddler
(13–18 months), explorer (19–23 months), preschoolers
(24 + months)
Targeted 21 years old with the boxy image, sexy
college kids partying, but 42 yr olds felt nostalgic
about their youth and bought the car
“EZ squirt ketchup” for teens
$3 million marketing to attract 12–24 yr olds.


256

PHI Learning

Age and Life Stage

Higher expenditure


257

PHI Learning

Decision-Making Process
Type of Families
Delayed marriages
Dual career families
Smaller families

Role of spouses
Husband-dominant
decisions
Wife-dominant
decisions
Autonomous decisions
Joint decisions

Need to understand decision maker at every stage

258

PHI Learning

THANK YOU.


259

Influence of
Reference Groups


260

Marketer Dominated Source

Non-Marketer Dominated Source

High

Low

Low

High

Mass
Media
Delivered

Personally
Delivered

261

PHI Learning

Contents

1

Reference Groups

2

Types of Reference Groups

3

Reference Groups in India

4

Reference Group in Choice of
Education—Possible Hypotheses


262

PHI Learning

Reference Group

Person
Group
Point of Ref.

Values

Formation

Attitudes
Behaviour


263

PHI Learning

Types of Reference Groups
Reference Groups
Reference Groups

Contactual

Aspirational

Disclaimant

Avoidance


264

PHI Learning

Indian Reference Groups
Indian Reference
Groups
Non-Celebrity

Education &
Career Choices
Parents
Relatives
Well-Wishers
Seniors
Friends
No professional catering

Faith Groups
Religious
Ritual
Worship
Spiritual
Caste based
Social marketing
quotient


265

PHI Learning

Education & Career Choices
Reference Groups

Career
Choice

Early
School

Middle
School

Sphere of Influence

PostGraduation

Graduation
(Entry)


266

PHI Learning

Hypotheses
1

2

3

Early School, unlike
Middle School, is still
governed more by
proximity to home than
by reference groups

Regional variations arise
as supply—demand of
occupations & societal
opinion govern
graduation & career

Reference Group
influences changes
while at graduation
Individual chooses
Reference group now


267

PHI Learning


268

PHI Learning

Impact of Culture
on Consumer Behaviour


269

PHI Learning

What is Culture?


270

PHI Learning

CULTURE
Culture is a combination of learned beliefs, values and customs that
can direct the behaviour of consumers in a specific society.
Knowledge &
beliefs

In India, hard work is attributed with success.

Values

Customs

Turban is worn by male members of the Sikh religion in India.


271

PHI Learning

Characteristics of Culture
Characteristics
•

Culture is learned rather than being born
with.

•

Culture is manifested within boundaries of
acceptable behaviour.

•
•

Transmitted from generation to generation.
Rituals practiced.

•

Dress sense–(Sari is the traditional Indian
dress while jeans, skirts, frock, etc. are
considered more modern.


272

PHI Learning


273
273

PHI Learning

Cultural rules can be categorized
into three types
Formal
Rules

• Explicit standards as to how one should behave, and violations
often carry severe sanctions.

Informal
Rules

Technical
Rules

• Involve implicit standards as to what constitutes a good product.
• In Bollywood, normally a Hindi movie must have at least five
good songs to be successful.


274

PHI Learning

Sub-cultures
•

•
•
•

Sub-cultures consist of ethnic groups such as regional, linguistic, rural vs.
urban, family composition, economic strata etc. Variations seen within a
culture.
These groups have common traditions, heritage, beliefs, customs and
experiences that would differentiate different sub-cultures.
For example, there are certain common aspects in the Indian culture but
almost each state in the country reflects a sub-culture.
Dress, eating habits, customs etc. are somewhat unique in different parts of
India and also, the life style pattern varies.


275

PHI Learning

Indian Teenagers
in contrast to Western Teenagers
Western teenagers

Indian teenagers

•

Grew up in relative economic stability.

•

•

Confronted by new realities: drugs, AIDs,
pollution, teenage pregnancy, divorce, etc.

•

•

Less sheltered home environment and
unstable family life. From young age itself
learn to be independent and make their own
choices in life.
More independent and self-sufficient.
Focus early on things they believe would
provide for a secure and happy life, like
earning money, spending culture or material
possession and acquisition.
A more stressful life as self-esteem is vested
in doing well in multi-faceted roles.

•

•
•

•

Grew up in period of fast economic growth
with good prospects.
Confronted by new realities through the
mass media but with few real-life
experiences.
Have more sheltered home environment and
stable family life. Youth live with family of
origin until their marriage.

•
•

Are less independent and self-sufficient.
Are idealistic in their expectations and tend
to deal only with issues that touch them
personally.

•

Lead a less stressful life as achievement in
studies is paramount and other matters
appear secondary.


276

PHI Learning

Features of Indian Culture


277
277

PHI Learning

Dimensions of Cultural Diversity in India
•
•
•
•
•

Language
Rural vs. Urban India
Rich vs. Poor
Geographical diversity
Liberal vs. Conservative


278

PHI Learning

Diversity in Language, Religious
Customs, Beliefs
There are 28 states and 22 languages
Numerous dialects spoken by people
Religious customs, rituals and beliefs vary
Different identities, ideologies, interests and outlook

Implication for Marketers
Communication & packaging in local language
Products need to be aligned with culture
There is a right way and wrong way for everything, but that can change from
place to place….

279

PHI Learning

Rural vs. Urban India
30% of the population live in urban areas.
70% live in rural areas–but this means the majority of the
market is spread across the country.
Different income levels in rural and urban India.
Rural customers attach more importance to functionality
while urban consumers give importance to
aesthetics/service parameters.

Implication for Marketers
Different marketing mix for both the markets
Mode of distribution/channels differs


280

PHI Learning

Rich vs. Poor: Different needs to fulfill

Source: Bijapurkar 2007 (NCAER)


281

PHI Learning

Geographical Diversity
An Average Urban North
Indian Consumer…

An Average Urban Eastern
India Consumer…

Beliefs & values–conservative in
thinking, respectful
Lifestyle–flamboyant, likes to have a lot
of external glitter
Behaviour–warm and friendly, herd
mentality, inquisitive

Beliefs & values–slow in speed,
relaxed, simple
Lifestyle–traditional, simple basic
Behaviour–opinionated, slow
adopters, rigid

An average Urban Western
India Consumer…

An Average Urban South
Indian Consumer…

Beliefs & values–progressive by nature,
professional, values time
Lifestyle–balanced, but very task‐
oriented
Behaviour–non‐interfering but helpful,
early adopter, trendsetter, calculative

Beliefs & values–orthodox and deep
rooted
Lifestyle–simple
Behaviour–curt but pragmatic,
practical, conservative, cautious, not
a risk‐taker
282


282

PHI Learning

Marketers must Understand
Indian Culture in Order to Succeed
•
•
•
•
•
•
•
•
•

Ford cars specially designed for Indian roads.
Electrolux's made‐for‐India fridge–chill drinking water, keeps food fresh &
withstands long power cuts.
Samsung–microwave oven with grill.
Nokia launched a handset “Made for India” Nokia 1100.
McDonald’s McAloo Tikki Burger & Pizza McPuff.
Cartoon Network introduced South Indian folk tale “Tenali Ram”.
Walt Disney cartoon TV shows are in Hindi.
Omega watches picked an Indian film personality to replace Cindy
Crawford in its ad campaign.
Coca‐Cola has redesigned its crates as well as trucks for safe delivery on
poor roads.


283

PHI Learning

Overall Marketers need to…
…Indianize, Humanize, Harmonize !!


284

PHI Learning


285

PHI Learning


286

PHI Learning

OR

287

PHI Learning

OR

288

PHI Learning

A Model of Consumer Behaviour

289

PHI Learning

Buyer
Characteristics
• Personal
• Psychological

Marketing–4Ps
• Product
• Price
• Place
• Promotion

Environmental
• Economic
• Technological
• Political
• Socio–Cultural

Buyer Decision Process
• Problem Recognition
• Information Search
• Evaluation Decision
• Post-purchase Behaviour

Post-purchase
Evaluation
• Product Choice
• Brand Choice
• Dealer Choice
• Purchase Timing
• Purchase Amount


Trial

Repeat
Purchase
290

PHI Learning

291

PHI Learning

Decision-Making Process
Problem Recognition

Information Search

Analysis of Alternatives

Purchase Decision

Post‐Purchase
Behaviour

Perceiving a difference between a person’s ideal and
Perceiving a Need
actual situation big enough to trigger a decision

Clarifies the options open to consumers
Seeking Value
Prior Experience, Word of Mouth, Advtg/Publicity Mktg
efforts.
Evaluate the parameters and options available for product
purchase: Form Choice Criterion
Assessing Value

Decision on ‘when, where and from whom to buy’
Buying Value

Value in
Evaluation during consumption/use
consumption/Use


292

PHI Learning

Problem
Recognition

• Why do I need it?

Information Search • What exactly is this product?
Analysis of
Alternatives
Purchase Decision
Post‐purchase
Behaviour

• What options are available?
• How exactly does purchase happen?
• Did I make the right choice?

293

PHI Learning

Problem Recognition
Ideal State
Simple Expectations
Future goals/Aspirations
Motivations/Self Image
Culture
Change in Personal
Circumstances

Actual State
Difference

Physical factors
Need
External Stimuli

Problem Recognition

Perceived difference between an ideal state and actual state
motivates the consumer to take actions.

294

PHI Learning

Marketing Implications

295

PHI Learning

296

PHI Learning

297

PHI Learning

Information Search
Internal Search

External Search

Process of recalling stored
information from memory

Using outside sources

Dependent on motivation,
ability & opportunity
More recall in high
involvement, perceived risk
Information retrieved
Brand
Attribute
Evaluation
Experience

Information Search

Types:
Pre‐purchase
Due to problem recognition
Ongoing
Regular; due to enduring
involvement
Retailer; media; experiential;
interpersonal; independent

298

PHI Learning

299

PHI Learning

Evaluation of Alternatives: Alternative Set

300

PHI Learning

Total Set

Awareness Set

Consideration
Set
Purchase
Decision
301

PHI Learning

302

PHI Learning

Purchase Decision: Process

Influencer plays an important role in consumer decision making.
Roles played by members of the family varies with demographic
Influencer may not be an expert but he/she assumes a key role in
parameters as well as with the type of the products
consumer decision and his/her family dynamics.

303

PHI Learning

Decision-Making Approaches

304

PHI Learning

305

PHI Learning

Post-Purchase Behaviour
Consumer evaluates the product during consumption to see if it
satisfies the need/expectation.

Influenced by type of preceding decision‐making processes.
Depends on the level of purchase involvement or the level of interest
in a purchase.
Cognitive dissonance and Experiential marketing play an important
role in shaping up these behaviours.

306

PHI Learning

Selective Search
for Evidence

Gathers facts that supports a particular decision
Disregards facts that support other conclusion.

Conservatism
and Inertia

Unwillingness to change thought pattern

Group Think

Peer pressure to conform to views held by a group

Recency

Experiential
Limitations

More attention on recent information
Ignores/Forgets distant information
Inability to look beyond the scope of past experiences
Rejection of unfamiliar
307

PHI Learning

Consumer decision making process
among today’s youth

308

PHI Learning

309

PHI Learning


310

PHI Learning

What is Celebrity Endorsement?
The use of celebrities in order to increase the sales and/or
the recall value of a brand is called celebrity endorsements.
Types of Celebrity Endorsements
Testimonial: Attestation by a celebrity based on personal usage.
Endorsement: Celebrity lends his/her name and appears on
behalf of the product or service.
Actor: Character endorsement.
Spokesperson: Celebrity represents the brand or company over
an extended part of time.

311

PHI Learning

Advantages
Instant awareness, knowledge about the brand and
easy recall.
Values and image of the brand are defined,
highlighted and refreshed by the celebrity.
The celebrity adds new edge and dimension to the
brand.
Credibility, trust, association, aspiration and
connectivity to brand.
Belief in efficiency and new appearance that will
result in at least trial usage.

312

PHI Learning

Hypothesis 1
Every product has its own identity and it’s very important to
endorse a product with a suitable personality.


313

PHI Learning

The Right Personality
Perfect match between brand image and celebrity
Celebrity's fit with the brand image and the celebrity‐
target audience match.
Celebrity associated values and the celebrity‐product
match.
Costs of acquiring the celebrity and his or her
popularity along with controversy risks associated with
the celebrity.
Credibility, availability and physical attractiveness of
celebrity.

314

PHI Learning

Hypothesis 2
Indian consumers have matured and celebrity
endorsement alone is not sufficient to attract them.


315

PHI Learning

Hypothesis 3
There are chances that the celebrity gains higher
popularity than the product endorsed.


316

PHI Learning

Hypothesis 4
Single celebrity—Multiple products: Consumer’s
dilemma to associate the brands with the celebrity.


317

PHI Learning

Hypothesis 5
Consumer buys a product based on its features rather
than the celebrity endorsement.


318

PHI Learning

Thank You!


319

PHI Learning

IMPULSIVE BUYING
BEHAVIOUR


320

PHI Learning

Impulse Buying
Sudden, compelling, unplanned, hedonically complex purchase.
Generates billions of dollars in sales every year for consumer
products.
Reacts often ‘mindlessly’ to stimuli that trigger certain
automated responses.
Information processing might have taken place earlier;
otherwise, behaviour may be totally impulse driven.


321

PHI Learning

Factors Affecting Impulse Buying
Behaviour in FMCG
Price and discount
Advertising and sales promotion
Visual merchandising
Emotional attachment
Company
Income
Festival season


322

PHI Learning

Stops Needed for Boosting
Impulse Sales


323

PHI Learning

Examples
A fan of Arsenal Football Club
watching a football match of the team
in a mall deciding to buy an Arsenal
T-shirt on display at the same store.

A person with no special passion for a
brand of high end wristwatches is
impressed with the look and make of a
Rado watch and buys it.

324

PHI Learning

Hypothesis 1
Promotion and placement of product in the supermarkets
have positive impact on impulsive purchase behaviour
Promotion
Advertisement of product in print and visual media
Various promotional activities regarding product
Erecting hoardings and distributing pamphlets of
product
Display
Packaging of product
Placing of product in store

325

PHI Learning

Hypothesis 2
Lifestyle traits of a person characterize his impulsive
purchase.
Traits considered:
Fashion involvement
Price consciousness


326

PHI Learning

Hypothesis 3
Discount offers on products have a strong positive
effect on impulsive buying consumer behaviour.

Branded products attract more on discount offers as
opposed to unbranded ones.

327

PHI Learning

Hypothesis 4
Shopping with others increases impulsive purchasing.
Impulsive purchasing at individual level vs. impulsive
purchasing with others
Shopping with family members, friends and colleagues
Factors
Susceptibility to influence
Normative: conformance to social norms


328

PHI Learning

Thank you ☺


329

PHI Learning

Indian Market
Diversity


330

PHI Learning

Demographic Diversity


331

PHI Learning


332

PHI Learning

Diversity in Men
Normally, an Indian Male is:


333

Consumer behaviour ramanuj majumdar

Consumer behaviour ramanuj majumdar

Empfohlen

Empfohlen

Weitere ähnliche Inhalte

Was ist angesagt?

Was ist angesagt? (20)

Andere mochten auch

Andere mochten auch (17)

Ähnlich wie Consumer behaviour ramanuj majumdar

Ähnlich wie Consumer behaviour ramanuj majumdar (20)

Mehr von Jithin Zcs

Mehr von Jithin Zcs (17)

Kürzlich hochgeladen

Kürzlich hochgeladen (20)

Consumer behaviour ramanuj majumdar