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Consumer Behaviour

Introduction Consumption is a part of almost every facet of our lives. This is true whether we have a lot of money or very little. In some cases the prevalence of consumption is such that we are often unaware of its importance in shaping our lives The study of people of as consumers The main focus so far has been markets looking to increase sales. They would want to know how social and behavioural sciences could be utilised to find specific causes of consumption and what makes consumers choose one brand over another, as well as how consumption would react to improvements in a product or brand. The focus upon predicting what the consumer will do under certain specified conditions is known as the positivist approach. The positivist approach takes the traditional form of scientific research it focuses upon the following points: 1. All behaviour has objectively identifiable causes and effect that can be studied and measured. 2. When faced with a problem people process all the relevant information available to deal with it. 3. After processing this information people make rational decision about the best choice. As with all social sciences studies there are limitations leaving a large amount of human behaviour unaccounted for. Reductionist Approach Because consumption is such a universal activity and is very frequent, there is a temptation to see all human activity in consumer terms, and to view all consumer activity with a positivist lens. Meaning a relationship as described in terms of the provision e.g. a doctor providing a service and his patient being the client. What is missing is the psychological content of the relationship e.g. why the doctor cares so much why the teacher does the extra hours at work etc.

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Interpretivist Approach

This combines the positivist and reductionist approach.

1. Cause and effect cant be isolated as there is no single objective reality that can be agreed upon. 2. Reality is an individuals subjective experience of it each consumer experience is unique 3. People are not simply, or always rational information processors or decision makers because this view takes no account of the individual emotional life (fantasy, fun etc) Consumer, Buyers and Customers People do not always buy goods or services for their own use. E.g. a mother shopping in the supermarket for her family, she will be influenced to some extent by what her family like to eat. She will probably buy things for them that she herself will not consume. She is also subject to some point of sale influences as individuals buying themselves e.g. packaging, price quality, packaging etc. So it is important to know who buys the product as well as who consumes it (for sellers). A consumers is a more general term e.g. people buying groceries rather than for people shopping for a specific item in a specific shop. Consumer Behaviour Involves the buyers or customers of products, as well as the people who actually use them. It deals with the buying decision itself and far beyond. Its extends from: How do we know what we want to what do we do with something we no longer want? How do we get into a product? How do we assess alternatives? Why do people choose or not choose product? How do we decide on value for money? How much risk do we take with what products? Who influences our buying decision and our use of the product? How can brand loyalties form and can they be changed?

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The typical definition of consumer behaviour that people engage in when selecting, purchasing, using, disposing of products and services so as to satisfy their needs and desires.

The consumer environment and the consuming society The ever increasing consumption is considered good for our prosperity. A fall in sales is taken as bad news. We are bombarded by hundreds of advertisements every day encouraging us to buy. We are bombarded by hundred of advertisements every day encouraging us to buy more. The most important feature of the consumer environment therefore is the universal and all encompassing value that buying is not just a necessary activity but an attractive and highly approved way of behaving; a good in itself. If consuming produces an ever higher standard of living for more and more people what could possibly be wrong with it? What about the earths resources? Is there enough for more and more consumption? Is it a morally just way of arguing the worlds resources, why should the rich get more food or manufactured goods than the poor? The consumer and the market place Trade is an integral part of human behaviour and has been since the beginning of time. Exchange between producer and consumer for neutral benefit Originally a barter systems, then precious metal coins were introduced, then as trade grows paper notes were introduced, and then plastic cards followed. Markets and Marketing Production orientation Demand exceeds supply. Consumers are forced to buy what there is rather than what they want. E.g. Ford any colour as long as its black. Marketing concept The producer identifies the needs, wants and preferences of the consumer and then satisfies them better than the consumer would. Supply exceeds demand. Summary

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Consumer behaviour is an integral part of our daily lives. The psychological and social process involved in the buying and consuming goods and services. The objective, positivist approach to studying cause and effect in consumer behaviour will be combined with the interpretivist emphasis on trying to understand, the emotional, non rational aspects of the process. The environment which the consumer operates in including the nature of the market place for goods and services also needs to be considered. Finally the change from a production orientation to a marketing concept has been instrumental in fostering the study of consumer behaviour recent decades.

Market Segmentation The development of the marketing concept provides a focus for a changing producer orientation from one of unthinking control and dominance of the producer consumer relationship to one of greater sophistication. Market segmentation is generally regarded as the essence of the marketing concept. Products like GM Cars (e.g. the 3 stages of an automobiles life journey) need to be positioned in a product market positioning are closely aligned with segmentation. The position of a product reflects how consumers perceive it. The perceived benefits of the product to the end user will be used as a key part of the promotional strategy. This implies the marketer will first segment the market and identify to the preferred target. Attempting to position without segmentation will be pointless. Computers can be enhanced or are now advanced enough to enable marketers to generate lists of individuals in their target market segment and send them personalised communication based on their demographics information. This process is called the Segmentation of One this actually represents a return to the relationship between producer and consumer before the advent of mass production and mass marketing. For a segmentation to work there must be a number of constitutions to consider: Identity - how identifiable and distinguishable from other consumers is a prospective segment and how easy is it to obtain the necessary information on such people? Access - how easy is it to reach people in this segment with the marketing communications? Size does the number of the people in the segment and their purchasing power justify the cost of marketing to them? B S Patil

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Types of segmentation Geographic Segmentation - Operates that people living in a given location have similar needs, wants and preferences that differ from people living in another location. There are limits e.g. Everyone drinks coke and due to the internet and satellite communication geographic boundaries are now obsolete. Micromarketing Is whereby different regions have different tastes. E.g. Campbells soup in the US or spicer food in California.

Climatic variations will also be applicable to geographic segmentation. E.g. there is greater demand for swimming pools in Florida than in Glasgow. In the UK water is softer in Scotland than in England, this has implications for soap, shampoo, etc marketing water softness. From a consumer point of view most buying behaviour is local, e-commerce and mail order being the exceptions. Localised consumer behaviour is often expressed through the presence of significantly large cultures or sub cultural group that is different from the main stream e.g. the spicer nachos in California due to larger Hispanic people there. Sometimes a local culture maybe marketed more widely like Jewish bagel or Indian food from Birmingham. Some locations just have oddities e.g. more sweets eaten per capita in Scotland than England, more Irn Bru etc. Obviously useful to know form a marketing point of view. Advertising to e.g. a geographic sector can be a more cost effective way of reaching a target market. Store specific marketing should also be considered, this takes place in stores. Demographic segmentation deals with way of categorising statistically the people in the total national population e.g. age, sex, income, education, occupation, social class, family, size, race and religion. These are essentially the different ways of viewing the same consumer. Different aspects to our identity will be relevant at different times e.g. baby food. Trends that influence most of the industrialised world The aging population - the grey pound Baby boom generation are now middle aged The proportion of young people in the population 15-20 is declining

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Household sizes have declined 1 person household Woman have fewer children and when they do they do it later life

Types of demographic segmentation Age: People of the same age usually have the same needs, wants and interests, people however perceive themselves from being a different age than they are. Sex: Some barriers are changing here as society changes e.g. diy kits to girls. Women still the main buyers of baby products. Men may buy underwear for women on occasion. Socio-economic status (SES): Made up of education, income and occupation. Income is usually considered to be the most important SES variable because it is so easily measured. Geo-demographic segmentation: Dividing up markets according to neighbourhood e.g. London, a different range of products will appeal to people in Millwall than St. Johns Wood. PRIZM in the US divides people or households in up to 40 categories. It establishes SES rating for each neighbourhood e.g. blue blood estate where the most affluent American families live to Public Assistance inner City. Along the way rural and other suburban. ACORN is another similar thing in the UK. Psychological Lifestyle segmentation (Consumer Profiles)

Divides consumers into segments based on activities, interests, and opinions. The American market is divided into 10 categories. Creating broadly defined categories e.g. Thelma traditional church goer Eleanor socialite with associated habits and spending patterns. All life styles/psychological systems are open to criticism; mainly not everyone falls into ten categories. Needless to say studies can be good starts to segmentation- there could be tweaking on a per product basis. Lifestyle, psychographic, psychological, segmentation use consumer profiles. Segmentation by usage This form of segmentation is based on information about volume and frequency of purchase for a given product.

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It uses Electronic Point of Sale (EPOS) systems to gather information. The market is divided into users and non users e.g. McDonalds. The 80-20 rule is in effect for most products. Time and timing is also an important factor e.g. students, offered incentives to open bank accounts as the back knows they will need mortgages etc later down the line. Benefit segmentation Based on knowledge of the benefits that consumer seeks from a product. Customising a product by a producer as far as possible is the ultimate aim of Benefit segmentation. Or customise belt buckles in London.

Summary Market segmentation begins when producers realise they could no longer sell whatever they produced but had to begin competing for business. The best market condition for successful segmentation seems to be based on: Identifability Accessibility Size Five forms of segmentation were identified: Geographic Demographic Psychological Segmentation as a benefit Segmentation by use

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A lot of work has been done on psychological segmentation producing various attempts at classifying consumers according to personality factors. There are constantly new products coming onto the market the exact number is unquantifiable. Estimated failure rates of these new products is also large 80% - 90%. How new products and innovations are marketed and how consumers respond to them.

Developing New Products There are more failures than success (+75%) and even the biggest and most successful companies have them. For example Sony Betamax, Ford Edsel, these companies were large enough and had enough profitable lines in existence to absorb losses, but many smaller companies would go bankrupt. Pressures that lead companies to the development of new products Declining birth rate in the industrialised world new products have to be sold more and more therefore to existing customers. Technological Innovation in all areas of goods and services that companies have to be aware and adapt to them. Pressure of organisation - changes is renewal innovation isnt a luxury its universal necessity.

Total product concept

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Theodore Levitt see a product as being a combination of various attributes that increase in complexity through four levels. 1. Generic product The substantive context (the car, the shoes, the hamburger, life insurance) that forms the core of the product that reaches the market. 2. Expected product The generic attributes plus the buyers minimal expectation of it (price, packaging, delivery and so on). 3. Augmented product The generic attribute plus the attributes that differentiate the product from its competitor e.g. free gift, features etc. 4. Potential product Generic, expected and augmented attributes plus and plus is where the new products and innovations come in. So the potential product is what is possible but not yet attained.

Successful innovation The most potent secret lies in changing some aspect however small, of the way society is organised, which results in satisfying a demand that consumers were perhaps unaware that they had. The supermarket is a good example of this, it changed the way people shopped, ate and travelled. A single outlet out of town, that could supply all of the consumers food. This made shopping become a major weekly exercise for many households rather than a daily routine, people had to buy food that would last all week, hence the rise of frozen food, and hence freezers to keep them in and microwave ovens to defrost them. Successful innovation also requires the creation of a relationship with the consumer, this again changes the way society is organised, consumers and producers are on the same side as each other with common rather than opposing interests. This allows producers to fulfil (and target specific needs of the consumer). Kaizen Meaning continuous improvement, big leaps are more satisfying than small incremental changes. Yet it is notoriously slow and difficult to make money from a B S Patil

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great innovation. It is small innovation targeted directly at someones need that produces the quick and generous payback. Product Life Cycle Intro stage, slow sales, new comers taking up the product, followed by growth whereby more sales take place and profits are made in the market, then the maturity stage and decline as the product is phased out and a replacement should come in.

It is claimed products have a life time of profitability. The very market success that makes something profitable guarantees its being a target for competition and of course the greater profitability the greater the competition. Some products come obsolete through advancing technology others through dramatically decreased markets and other may find a new niche market nylon stockings. Some products seem to have an indefinite space e.g. mars bars. It is also very hard to know what phase of the PLC you are in unless PLC. The effects of personal influence The influence of personal factors on the process of innovation is the important for their effects on both the producer and the consumer. Product Champion Can be difficult to work with because they are unusual to the corporate world. Tom Peters these characteristics as: Energy, Passion, idealism, pragmatism, impatience, doesnt recognise barriers, love / hate relationship with colleagues. The product champion may be the head of the company so would break rules, or be non traditional in their approach. B S Patil

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Opinion Leaders As consumers they are not always innovators but are more open to new ideas. They range from 10% to 25% of the population. They tend to be more out-going and knowledgeable about the product in question and are very important for word of mouth communication about the product. Advertisers take advantage of this and use celebrities to promote products. Diffusion of New Products and Innovations The process by which innovation is communicated through channels over time among the members of social systems It is therefore a macro or group process as companies with micro or individual process of adoption of new products and innovations. Three main innovations have been identified

Continuous modification to existing products, new models and flavours to existing products, new models and flavours. Dynamically Continuous Requires more change in consumer behaviour. Can be the modification of an existing product or the creation of a new foods, music formats etc. Discontinuous Require a new form of consumer behaviour the rarest but with the greatest social impact e.g. facebook

Five product characteristics which determine consumer responses: Relative advantage To what extent does the improvement represent an improvement to existing products, this improvement is in the perception of the consumer. Compatibility How well the issue deals with the consumers existing values, attitudes, intent and behaviour e.g. new Bacon products in the Middle East isnt a winner but non booze beverages maybe. Complexity The perceived difficulty in using a product Trail ability Is it possible to try out or sample on a limited basis. Some products can be tried others cant. Observability How easily the benefits of the product can be observed or communication to the consumer. The Adoption of New Products and Innovations Different generations grow up with different innovations

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Some innovations like the telephone, car, and radio have become taking for granted by several generations that grew up with them. Some innovations are user friendly, so even a generation that did not grow up with them will adopt them rapidly. Some innovations may achieve an appreciable penetration of the market because of the perceived usefulness while only being friendly for a tradition of buyer while only being friendly for a traditional buyer usually the youngest VCR/ home pc. No innovation will be adopted by everyone.

Typical adoption of new products

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Summary Thousands of new products are marketed every year most of them fail. This is because of declining birth rates in the developed world, shortening lead times on the profitability of new products and intensified global competition, innovation is now regarded as a crucial function of all organisations. Levitt, total product concept is a useful model for marketers in thinking about the benefits of the product they are introducing. Successful innovations seem to imply some form for reacting to social change in the life of the consumer or in the relationship between the consumer and producer or products. New products go through a five stage life cycle from its introduction to its inevitable decline, by the later stages replacement products should rationally be in the process of development this doesnt always occur. Personal influence is often extended on the introduction of successful products both in the form of product champions within the producers and opinion leaders among consumers. Diffusion of new products may be accomplished by three forms of innovation: Continuous, dynamically continuous and discontinuous. The adoption of new products is never totally immediate, but often longer this produces anticipate being profitable. Large profit can still be made from small number of users.

Perception Introduction: Can we Trust our senses There is no such thing as objective reality e.g. glass half full / half empty. We each perceive the world differently and we have to construct our own reality out of it. The first point we have with our physical environment is through our senses. Our brains processes information with the sensory messages it receives. Consumers are bombarded with vast amounts of information. Using our senses

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Information about the environment is conveyed to the brain from eyes, eats and other organs. Within the five sets of senses (Vision, Hearing, Touch, Taste, Smell) there are then sub senses e.g. taste 4 different types. Also bodily movement and balance. It is the range and co-ordination of the human senses together with the sensitivity, that provide us with a unique quality and quantity of information about the environment. Vision we tend to take our vision for granted. Package designers are aware that people loose their vision by their 40s so make suitable package so that it is noticed. Hearing in store background music when slow music was played people would walk slowly and sales increased by 38%. In fast food restaurants music is faster so people get out quicker so seating can be utilised. Hidden Power of Smell The sense of smell and taste, which we normally think of as being quite different are actually very closely related. If we didnt have a sense of smell food would taste very differently. The tip of the tongue has taste buds which are sensitive to salt and sweet, the sides are more sensitive to sour and the back to bitter. Manufacturers of food, use salt and sugar to provide sensations to the tongue (e.g. fast food). More subtle food like Indian etc rely on more spices etc. Perfumes are of course lead by smell. Like most things perfumes are gender based, with womens products being heavily floral and mens products tending to be more, woody and tobacco and leather and other more masculine associated smells.

Women are more sensitive to scent they tend to buy mens products for them. Scent can not be seen, so sometimes product attributes are put to another factor other than smell, even though the smell is the driving force behind purchases. Multi Sensual Marketing We are used to associating consumer environment with specific senses, like a supermarket vision or a perfume counter with smell. However, clever marketing will make use of a wide as range of sensory stimulation as possible.

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e.g. a book shop would have music, well laid out shelf space, soft carpeting and a coffee shop with pleasant appetising smells. Common properties of Senses Thresholds of awareness Before we can become aware of any stimulation from the environment, a stimulus has to be strong enough for our sense receptors to pick it up. Below a certain level of intensity, we will not pick it up. This threshold is known as absolute threshold because it marks the difference between sensing and not sensing. Different people have different thresholds. A person s ability to sense a certain stimulus may also vary depending on his or her psychological or physiological condition at the time; e.g. drunk / sober, excited or depressed. Manufactures want their new products or redesigned existing products to be immediately noticeable in the consumers environment. Research may therefore be done to determine where the consumers absolute threshold might be in this environment in terms of shape, size, colour and so on. There is a sensory threshold that operates between two stimuli. The minimum amount of difference that you can detect is call the just noticeable difference (jnd). Once you have detected a jnd between one stimulus and another you have crossed the difference between them. A one pound increase in the cost of a house is not a jnd, whereas a one pound increase is a jnd.

The manipulation of the consumers difference threshold is also a commonly used technique of marketing. A new product that claims to last longer the opposition (must be noticeably so) Sometimes products (candy bar) decrease in size to keep there price the same.

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The other relevant variable of quality is also subject to the same manipulation through the jnd, maybe more sensitive than either price or quantity, except at the cheap end of the market. Knowing where to pitch a sales discount for maximum effect is another marketing use of jnd that cuts across all retails sectors. Sensory Adaptation People in fish markets get used to the smell. If the stimulus is constant and familiar the sense organs become insensitive to it and stop sending information about it to your brain. There is a limit to sensory adaptation of course if your watch strap is so tight it cause discomfort, you will not be able to adapt to it, you will change your environment by loosening the strap. If your tooth paste changes changed ingredients you could change it if you wanted. We also adapt to advertising both generally and specifically. That is why advertisers go to such lengths to be noticed among all the other adverts. This is why advertising companies change so frequently. Perception: Processing Sensory Information The sense organ provide our brains with steady flows of information about our environment and the brains task is then to take this raw material and use it to help us make sense of the environment through the process of perception. The brain does it so smoothly, we are not aware it is happening. The raw material provided by our sensory apparatus is thus a very important component of the perception, but it is not the only one. We see, hear and feel things that are quite unlearned if we relied upon these wed be helpless. We learn to interpret and order these sensations in such a way that the environment becomes secure and predictable. Focusing and Attention Our consumer environment is only part of our total psychological environment. Even so, it has been calculated that most of us are bombarded with many hundreds of advertisements, every day. If it appears as few of the stimuli that impinge on us at any given time of any immediate importance, we filter out the ones which are important, by paying attention to them and we ignore the rest. We focus on whatever stimuli are most important in the environment at any one time. E.g. ignoring the hum of the air conditioner but focus when it stops.

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By attending to certain sensory stimuli and not to others we give them access to our sensory memory the first stage of memory process and they can then move from there to short term and long term memory. Underlying this series of psychological process is corresponding physiological process. Thus, when one channel of communication between sense organ and the brain is occupied and has our full attention, the other physiological pathway to the brain and apparently blocked so that we do not become confused and overwhelmed by the other sensory messages. We follow the same process of focusing for instance when we go shopping. Selective Perception and Distortion In order to make sense of the sensations our perceptions have to be selective. How, to make a selection? How to perceive something and to give it our attention? But, attention can continually shift. What determines which stimuli will capture our attention? Psychologists refer to external and internal factor in trying to understand attention getting and selective perception. External Factors E.g. the air conditioner we only notice when it changed, it captured our sense. It is the stimulus provided by change in the environment that is most important. The change can take many forms, contrast between sound and silence, is one of them a tall person in the street rather than on the basketball street. Movement in the environment is another important kind of change. People are responsive to visual movement, quite automatically. Sheer repetition of a stimulus is also an effective way of getting our attention, a particularly important phenomena in advertising. In what psychologist call a more exposure effect it has been found, that repetition gains our attention, it encourages us to have a slight more positive attitude to stimulus in question. It follows from this that the more familiar we are with a products brand name, other things being equal, the more highly we will regard it. And, buy it. Although this isnt a law it does appear the most highly advertised products sell best. Size can also be an important external factor. This is why newspapers and magazines grade the importance of their headline by size of the type used, the more important the message. Intensity of a stimulus is also used to catch our attention. Bright colours, loud sounds are routinely used at public events, whether commercial or whatever. Commercials flood us with sounds and colour.

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Internal Factors Different people react to the same sensations in different ways. People have different interest and of course different sexes or sexual orientation and will have differing reactions. Peoples emotional and physical states will change and if this does not happen to feel the same way at the same time, then they may well have different reactions. The most important factor in perception is what people expect to see in each situation. People distort their perceptions to fit what they expect to see perceptual distortions. Organising Perceptual cues The brain is very ingenious and creative in the way it organises the smallest sensory clues from the environment to present us with meaningful pictures that we can operate with. Sometimes as is the case with the perceptual distortions that picture does not confirm with objective reality. Illusions - Internal factors can lead us to perceive things differently from the way they really are, but so can external factors. Each person brings a different unique group of internal factors to a perceptual situation; the external factors for everyone else are the same. Figure and ground The most basic of the illusion argument is how we perceive things against the background; e.g. we need a background before we can pick out an object in the environment. (E.g. the photo two faces/vase) Contours In advertising this is important e.g. the brand name shouldnt be a part of the forgettable background. Sometimes the music for an advert is remembered not the background Sometimes people cant tell what is being advertised or by who. Grouping People tend to pair things into patterns the wearing of uniforms is a common form of grouping the similar and identifying the dissimilar as applied to people. People react to a uniform rather than the person same with city folk and so on. Closure Despite the fact that things are incomplete e.g. a word or pictures, people will close them e.g. a picture with holes. The Zeigornik effect people who worked on a variety of tasks remember the ones that they didnt complete... rather than the ones they did. Gestalt psychology What we perceive is more than the sum of the sensory stimuli that impinge on us from the environment. We perceive gestalt for or configuration, each gestalt has more meaning to the perceivers than just its sensory properties of B S Patil

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size, colour, or weight something may have meaning far beyond its physical properties. We search for patterns to make sense of the parts. Perceptual Constancy - While the sensations we receive from the environment are ever changing, our perceptions of things remain constant. E.g. you see a cup in front of you as an elliptical object, but you know it is round.

How so? What we see is not always what we perceive, not just in visual illusions but in our everyday perceptions we have to learn the meaning of what we see. E.g. black snow at night is really white. Depths and Distance Helps us translate two dimensional information into three dimensions. Movement Some of the movement we perceive, like a bird fly past the window, can be explained as visual stimuli moving across our visual field and stimulating different parts for the eye. Much of the movement we see is illusionary, a film consists of a series of still photos its done so fast we perceive movement on the screen. Phi Phenomenon moving neon or other light quickly looks like movement which gets our attention as we notice movement.

Subliminal Perception Vicary put subliminal messages into films, but this was below peoples absolute threshold so they made little effect. He increased the frequency and sales were said to increase. This method was attempted to be studied further but to no avail. Humans are capable of subliminal perception; we can perceive small stimuli that we can not see or hear we may notice them but not register awareness. Products Images, Self-Image and Consumer Behaviour People have an image of themselves including a view of themselves as a consumer we buy appropriately to fit this image. Perceived Risk As consumers we make a steady stream of buying decisions the outcome may be quiet uncertain. If we are consciously aware of this uncertainty we are perceiving risk. 1. Performance 2. Financial B S Patil

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3. Physical 4. Time 5. Social 6. Psychological There are several types of situation that will influence our feelings of uncertainty about risky outcomes. Uncertainty about purchase goals is the car for communicating or the occasional trip. Uncertainty about best alternative choice what is the best for a certain look and uncertainty about making or not making a purchase, will the consequences be satisfactory? Coping with Risk Information gathering Relying on brand loyalty Some official seal of approval The image of major or brand Image of the store Summary Perception involves the construction of reality by the brain with the information it receives from senses. All senses, but especially the dominant modes of vision, and hearing are used by marketers and advertisers in selling products. All senses have common properties, notably threshold of awareness between sensing and not sensing a given stimulus (absolute threshold) and distinguishing between two different stimuli (differential threshold) and adaptation to a given level of sensory stimulation. The processing of sensory information, which is the basis for perception, normally works so efficiently that we are unaware of it. At the same time there are situations, involving both internal or personal factors and external environmental factors, in which the brain is subject to illusions and perceptual distortion. The existence and possible effects of the subliminal has been a matter of debate in consumer behaviour. The perception of product that consumers have is an important reality for markets to deal with. It is bound up with consumers self image. Finally a perception of risk in making a purchase may apply to a given consumer. Marketers need to be aware of this possibility so they can help the potential purchaser minimise this perceived risk.

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Personality How does personality affect what we buy? What is meant by personality? The term personality is commonly used in both psychologically and everyday speech. Psychologist interested in this subject want to know what makes someone a unique person. What are the characteristics, way in which he behaves? What is the overall pattern of how he relates to other people and how they react to him? In everyday speech we talk about someone being tough, aggressive or being nice etc. These patterns are categories of behaviour, as defined by society, that we have learned to recognise from our previous experience with people. Where the difference lies is other people do not try to assess the uniqueness of an individual at the same time, they place them in categories that emphasise his sameness. Both psychologist and layman use the term personality to make sense of an individual s behaviour. It is only an individuals behaviour after all that we have to go on. All we can do is observe that behaviour and infer what inner process motivated them to do it. This is just as true for psychologist as any one else. The psychologist makes his theory or personality explicit while that of the layman usually remains implicit and not consciously thought about. Formal Theories of Personality There are many formal theories of personality. Psychology defines the term personality: The sum total of all the factors that make an individual a human being both individual and human; thinking, feeling and behaving and the particular characteristic pattern of these elements that makes every human being unique. No theory can fully explain personality humans are too complex

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Freudian Psychoanalysis Freud thought of human personality as being in three parts. The Id, the ego and the superego. Id The id is composed of the powerful drives, raw impulses of sex and aggression that demand to be satisfied immediately. We are not usually aware of the id, it is unconscious (e.g. pleasure). Ego We are aware of our ego. It is the rational conscious, thinking part of our personality. Our self image would be contained within the Freuds image of the ego. The ego gets its working energy from the id, but when the id impulses are too strong it represses them and defend itself from knowing about them. Superego Like the id it is usually unconscious so that we are unaware of its workings. It is the part of our personality that we are unaware of its workings. It is the part of our personality that deals with the right and wrong, with the morality, with the correct and proper way to behave, feel and think. The superego can be just as powerful as the id in its demands on the ego that we behave the way we should or take the consequences of feeling guilty. These three aspects constantly interact with each other as we move through life. Frequently they are in conflict. The conflict appears in the ego as the conscious feeling whose source we are unaware of because both id and the superego, with their conflicting demands, remain unconscious. Freud referred to the personality as an iceberg

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Freud believed that the first three years of a persons life were absolutely crucial in shaping the adult personality. Repression is not simply a passive business of working to know certain things. On the contrary it is an active process that takes up huge amount of psychic energy to hold things down in the unconscious. Freud reinforces this as dynamic unconscious and psychological process involved in referred to as psychodynamics. This means that the most powerful causes of human behaviour are unconscious and unavailable to external observation, was a powerful one that attracted an important following around the world.

Freuds development stages Oral stages To a young baby, the mouth is the most important source of gratification and physical stimulation for the first couple of years. Infants first learn about the world via their mouth, a lack of satisfaction in sufficient doses can produce a hostile sadistic kind of personality. On the other hand too much gratification can lead to too much improvement depending on others. Anal stages At the age of around two infants obtain control of their anus muscles. This control leads to gratification and dealing with the authority figures of parents controlling the training. Too much strictness during this period can lead to people being anal obsessively clean, controlled and ordered. Laxity leads to disorder and messiness. Phallic At around 4 years of age, a child enters a phallic stage of development, where the gratification is associated from the sensuous pleasure from the genitals, including masturbation and fantasy. The Oedipus complex is represented after c. 5 years old it remains a crucial part of personality for a life and plays a large part in determine someones attitudes, not only towards the opposite sex, but towards people in a position of authority. Application of Freudian theories to Consumer Behaviour and Marketing Given the emphasis on the unconscious nature of many of the causes of our behaviour this is important to marketing. The consumer is often unaware of needs that a product may be satisfying beyond the most immediate and obvious ones. e.g. expensive jeans we just need to be clothed but people want what is perceived as the best, or everyone of their peer group wears them. This might be to do with acting out fantasies or aimed at the pleasure principal of the id.

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Richard Dichter Founder of the institute for motivational research. Dichter first proposed that having a convertible car is the same as having a mistress. Modern advertising places heavy emphasis on wish fulfilment, fantasy, aggression and affiliation with others. A frequently used technique is that marketers adopt is the appeal of consumer lifestyle rather than the product itself. Markets use personality test when they come up with advertising campaigns. Three listed below are based on Freudian theory. Personality Test getting behind the public face that individuals present to the world and obtain a picture what they are like the inner life, that may not be aware of.

MMPI (Minnesota Multi phase Personality Inventory) This has 559 questions where the testee answers true or false or cannot say. Is good for revealing patterns of behaviour and attitudes. TAT (Thematic Appreciation Test) Requires the subject to project onto some vaguely defined picture of what is on their mind. of 20 black and white pictures. The pictures act like a screen on which the trustee inner life is projected. Rorchach Ink Blot Test Ten pictures of ink blots are used in colour and five in black and white. Subjects are asked what they see in the ink blot. What it reminds them off. There are no correct answers. Neo Freudian Psychoanalysis Some of Freuds followers tended to de-emphasis the importance of id in favour of more ego related social factors. E.g Freud gives too much weight to biological drivers which are tied up in the id and ignores the social interactions in the world we live in. Neo-Freudians believe interpersonal relationships especially those between parent and child form the individual personality. Karen Horney produced a model of human behaviour that has been used in research by consumer psychologist. The CAD Model.

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The compliant orientation includes people who move toward others. They are dependent on other people for love, affection and approval. The aggressive includes people who tend to move against others. They have a need for power and the ability to manipulate others. The detached orientation includes people who move away from others. They stress the need for independence and self reliance and avoid developing emotional bonds, which can create obligations. A CAD scale has been derived to measure the orientation of individuals as consumers. Compliant people prefer recognised brands; detached people are less interested in being consumers. Self Theory Centred on the work of Carl Rogers, from the school of human psychology. Rogers take an optimistic view of the existence and creativity and potential for growth within every human. However, this potential that people have often remains unfulfilled. Rogers argues due to the oppressive effects of family, school and all other social institutions that shape the lives of individuals. By searching for their inner life can free themselves from the conformity of institutions and the dogma of authority. Rogers stresses the importance of the conscious self image in this theory he is not interested in the workings of the unconscious. To the extent that a person is maladjusted in his behaviour his self image is out of touch with reality. The origin of the concept of self The concept of self which Freud would consider to be a part of the ego is widely used by personality theorists as the basic building block of personality. As such it is important that the origins of self is understood. A sense of who we are develops through the process of interacting with other people. From birth people respond to behaviour and in turn enact responses. Individuals receive feedback on themselves. The basis of self image is physical a body image and it will largely remain so throughout life. At first infants have difficulty knowing where they end and the external environment begins. They slowly develop control and understanding of their body, they then can start exploring their environment. With broadening of childs horizon that comes with development of language there also appears a more detailed self image. Young children have no alternative but to believe that they are what their parents tell them they are. If the message from the B S Patil

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parents is that they are unlovable then that is the judgement they will make of themselves. We should not then be surprised to find that they then start to behave in an unlovable fashion. By the end of adolescence the outlines of our self concept have been set and crucial question of our self image whether or not we like ourselves and have low or high self esteem has been answered. In one sense, though our self concept is a never completely formed or finalised and our self esteem can be raised or lowered to some extent by social factors. E.g. like being treated as popular or attractive, you will feel it and then act as such. Marketing and the concept of self The concept of self has long been on interest to marketers because of its subjective element. Actual Self Image How we actually see ourselves Ideal Self Image How we would like to see ourselves Social Self Image How we think others see us Ideal social self image How we would like others to see us. Advertisers try to appeal to the different self images for different products. It is especially important when people are trying to change an actually physical self image into an ideal one. Trait Theory Raymond Cattell stated that we all have different traits (characteristics) that are shared but we all differ on the strengths of various traits. Cattell came up with 16 factors on which he based personality profiles. 16 pf it is widely used in job selection and vocational guidance. Catell suggests that there are three important sources of personality data: Life data, self report, questionnaire data and objective data from personality tests. Brand personality A more modest and attainable use of personality factors in marketing and in understanding consumer behaviour, lies in the development of a brand personality. A way of changing the image of a brand by giving it personal associations, as though it were an individual; the brand would be described as, feminine, masculine, rugged etc. An important part of brand personality is colour. Some colours are associated with certain characteristics e.g. white in a Western Nation is associated with purity and cleanliness gold means wealth and royalty. Summary B S Patil

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Personality factors are of great importance to consumer behaviour. Professional psychologist and laymen use the term personality to make sense of someones characteristics behaviour. Of the most influential is psychoanalysis both Freudian and Non Freudian. Self theory and trait theory is also note worthy in increasing our understanding of consumer behaviour. Brand personality is another off shoot.

Learning , Memory and Thinking How do we learn A great deal of animal behaviour is programmed, or instinctive, but the higher up the animal kingdom you go, the less important does the instinct become. Humans have virtually no instincts at all. What they have is the capacity to learn, thus giving humans the advantage to adapt to situations. In the process of being socialised children must learn the approved ways of walking, talking, eating, excreting and thinking. They also learn to make sense of life in the fashion approved by a particular society; whom to like and whom to dislike, how to decipher the mass media, how to deal with advertising and how to make buying decisions. All consumer behaviour therefore is learned behaviour. What is learning? Learning is the relatively permanent process by which changes in behaviour, knowledge or attitudes occur as a result of prior experiences. Relatively permanent An outcome that is not due to the effects of temporary situations, like drugs or alcohol or being tired any of which can affect the way people act for a limit period of time. The other key terms are behaviour and knowledge. This is referring to two schools of study: Behaviourist and Cognitive.

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The behaviourist Approach Behaviour is described as: Psychology as the behaviourist views it is a purely objective branch of a natural science. Its theoretical goal is the prediction and control of behaviour. Watson did not believe in the existence of the unconscious mind. He did not believe in the existence of the conscious mind either, or any other kind of mind. There was nothing to study other than someones observable physical behaviour. What you see is what you get Pavlov and Classical conditioning Identified that the working of a process was clearly psychological.

Watson took Pavlov work and incorporated it into theory of Behaviour. Here was a clear and objective way of understanding why a given stimulus produced a given response without the recourse to talk of mental processes of the mind. Moreover it should be possible, using the conditioning method to change someones behaviour in a desired direction. Consumer Application of Classical Conditioning Behaviourist point out that quite a lot of human behaviour can also be explained by simple conditioning. The basic link in classical conditioning between the conditioned stimulus and unconditioned stimulus is at the heart of a great deal of our consumer society. The goal is associate a product (CS) with a particular image (US) that is thought to be attractive to the potential customer. E.g. insurance being the product and associating it with beach... which is attractive to the consumer.

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A laboratory study has shown how people can be conditioned by music in an advertisement to choose one colour over another. Stimulus generalisation Dogs would salivate not only to the usual sound, but to other stimulations buzz, bells etc. The animals were generalising from particular stimulus they had been conditioned with to a wider range of stimuli that sounded like it. Brand extension is an example of this in marketing e.g. a positive response to one brand leads to a positive unconditional response to others. Stimulus discrimination is the opposite effect. Pavlov demonstrates that a dog can be conditioned not to generalise to any other stimulus. Animals could be trained to discriminate its original conditional stimulus from any other conditional stimulus. He rewarded the animal with food if it salivated to one sound and did not reward it for responding to any other sound e.g. brand loyalty etc. Skinner and Operant Conditioning Without waiting for a push from the outside, an animal will often begin to explore its surroundings to operate on its environment. This is Operant Behaviour (BF Skinner) it is also called instrumental conditioning taking the Pavlov works a step further e.g. a rat is left to find something that rewards it (food) once discovered by accident the rat wants to get rewarded again, after several occasions. The rat associates the bar pressing with the food, operant behaviour positively reinforces behaviour with the appearance of food. When food is withdrawn, the rat stopped finding the bar. This is not the same as punishment, just dissuading. Skinner also demonstrates that the avoidance of pain is at least as important in reinforcing operant behaviour as the gaining of reward. Skinner set up an electric shock so by accident the rat got shocked. It quickly learned not to this is aversive conditioning and its results from a schedule of negative reinforcement. This is not the same as punishment. Punishment is only useful as a discouragement. B S Patil

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Positive reinforcement press the bar and get a reward. Extinction reinforcement remove the bar to stop behaviour. Negative reinforcement press the bar to avoid pain. Punishment giving pain after an undesirable action. Consumer Application of operant conditioning It is important at all cost that the consumer is not punished (get a bad product) after a purchase. There is no cheaper form of positive reinforcement than saying thank you or following up with a thank you note. The cognitive approach

Learning is the relatively permanent process by which changes in behaviour knowledge, feeling or attitude occur as a result of prior experience
The problem is one cannot see someones knowledge, attitudes or feelings, all you can do is see what they do and infer from their behaviour what they think or feel. Until one tells or buys a product you cannot tell what their opinion doesnt exists. Cognitive learning is essentially the relationship between means and end. Insight learning Trail and error learning is a slow and laborious process. People, as well as animals, learn by this means but humans learning is due to insight, where the understanding of a situation or the solution to a problem seems to occur quite suddenly and without any careful step by step process of learning.

The cognitive approach was founded by Wolfgang Kohler emphasising the importance of knowledge and insight. The greatest advantage of an insight solution is that unlike trial and error learning, it can be applied to new situations. No specific skill or set of movement is learned, but an understanding of a relationship of a means and an end is gained. There is a link between the psychology of perception and perception of learning, the concept of meaning. Just as the way we process environmental stimuli is crucial to our perception, the way we process information is crucial to our learning. There is a link between the psychology of perception and psychology of learning; the concept of memory. Information Processing and the concept of memory

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Whatever we learned would be of no use to us unless we had some way of storing it, ready to retrieve it when needed. This procedure is often referred to as information processing. When we learn something the brain engages in various activities that probably result in some kind of physical traces. Then we store this information and experience in our memory. Whatever can be retrieved is remembered and whatever cant is forgettable. People can recognise more advertisements as well as recalling them. It is important for the marketer to decide whether to aim for recognition or recall in planning a marketing campaign. Recognition will be a much cheaper option. The process of committing something to memory seems to involve 3 distinct stages as outlined below:

The advertisers problem is not getting a product image into the memory system, but keeping it there. Sense memory last less than 1 second e.g. glancing at a phone number, the second stage lasts for slightly longer up to 30 seconds long enough to decide if the information is worth keeping. As most information is not worth keeping, it is not encoded it is discarded forgotten. Some information in the second stage is important so is transformed to the third stage. This is called long term memory and in order to get there the information has to be processed while being held in short term memory. New information is constantly B S Patil

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passing from sensory memory into short term memory and as it does it passes out the information already there. Info that is earmarked for long term memory is rehearsed or repeated to ensure it is kept. It is encoded and placed along side similar information. Information in long term memory is not static it is dynamic: In a constant state of re-organised, conscious or unconscious. Why do we forget? It may be the stimulus we are given is not sufficient for us to retrieve the meaning or it may be that we do not want to remember. Making learning meaningful The below are almost all applied to advertising: Repetition The most obvious and most immediate technique for learning something is simply to repeat or rehearse the information. This is how powerful is passed from short term to long term memory storage. Radio and TV commercials make use of this. This is by and large and effective method when there is little competition but may cancel each other out when there is a lot of completion. Visual One picture is worth a thousand words this seems to have validity in advertising. This why symbols are used to represent brands making brand names easily learned if they come with visual representation. Self referencing The act of relating information to ones own life, this is triggering key points in ones self, playing one individuals self image. The trigger is pulled by using the word you and referring to previous consumer experiences. Mnemonics Breaking information down into groups and associating each group of information to be a trigger. Like public speakers in Greece orators e.g. phone number areas, code extension etc. Meaningfulness We learn things by linking them to things that we already know. We organise our memories into packages and call them schemas, tapping into those schemas is the goal of every marketer.

Modelling Claimed by both the behaviourist and cognitive camps. Referring to modelling or observational learning, people observe the behaviour of others and use them as models for their own behaviour. Children learn from parents and older siblings and peers. They can learn the behaviour without experiencing it. Meaning this is a social, observation and vicarious way of learning. B S Patil

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Summary Learning is a key psychological process that has been intensively studied for many years. There are two main approaches to this research, representing two major schools of thought. Behaviourist and cognitive approaches. The behaviourist approach is based on the link between stimulus and response and deals solely with behaviour rather than thoughts or feelings. Its key technique for influencing behavioural responses is that of conditioning. The two major forms are classical (Pavlovan) and Operant. The cognitive approach deals the mental processors such as memory, information processing and thinking in general and is concerned with insight as a form of learning rather than trial and error of the behaviourist approach. The search for meaning in what we learn is a crucial part of cognitive approach. Tapping into this search and directing it in a chosen direction is the ultimate objective of marketers and advertisers. Modelling learning form other people is an important aspect of everyday life from earliest childhood and why that is widely used to sell many products.

Motivation Why do people buy what they buy? What is meant by motivation? Asking why gets us to the heart of motivation.

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Motivation, why do people do things? Two broadly accepted ways to make sense of peoples motivation. Theory X People are inherently lazy so they must be motivated by external incentives. They will pursue their own goals, which run the counter to those of the organisation, so they need extra to keep them in line. They are quite irrational and incapable of self discipline of self control. The rate individuals, who are rational, controlled and self motivated will therefore have to manage others. Theory Y People seek meaning and a sense of accomplishment and to exercise autonomy and be independent in their work. As they are basically controlled and self motivated they will find external controls and incentives demeaning. If they are only given the chance to do so they will come to regard the organisations goals as their own. These different beliefs will lead to a different ways of managing staff Defining Motivation It is elusive to define A general term for any part of the hypothetical psychological process which involves the experiencing of needs and drives and the behaviour that leads to the goal which satisfies them.

Buying Behaviour = Ability + Opportunity + Motivation BB = F (A,O,M)

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The fulfilment of needs Several major theories of motivation, the best known being those that deal with the fulfilment of needs. Needs are often divided into primary biological or physiological needs like food, drink and shelter secondary needs like love or power. Primary needs must be satisfied before secondary needs, simply because of the overriding importance of survival: An artist starving will not produce much art. We need food and drink to survive, we can live without power. Maslow hierarchy of needs

People strive fulfil their needs, first at most basic physiological level necessary for survival. When their needs are fulfilled they are no longer motivated by them but other needs will always take their place, which are motivating as people reach self actualisation, they seek to express personality characteristics like independence and autonomy to strengthen and deepen personal relationships and to maintain a sense of B S Patil

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humour and a balanced view of life. The more self actualised people become the more they want to become. This is a motivation with its own inner dynamic. Consumer applications of Maslow hierarchy of needs Maslow suggested that people were influenced by higher order needs even when all their lower order needs had not been entirely satisfied. It was an though on average our physiological needs were satisfied 80% of the time and so on through the hierarchy to having our need self actualisation satisfied say 10% of the time. What this implies for marketers is that virtually everyone is in the market at some level for the whole range of need satisfaction and that people may quite consciously trade off some areas to spend more on others. So people may decide to spend money on certain items that fulfil housing needs rather than focusing on education or may spend little on housing to free up money for education to fulfil self actualisation needs. Marketers like Maslow as its easy to work with: Physiological - Housing, food, drink, clothing. Safety Insurance, burglar alarms, fire alarms, car with bags. Self Esteem High street brands. Social greeting cards, facebook, group holidays, team sports. Self actualisation Educational services, skills, experiences. It has been more recently suggested that Maslow framework is a useful way of identifying emotional triggers in consumers, so that marketers can go beyond specific product benefits and appeal to the physiological needs may be trying to satisfy e.g. physiological segmentation. Perception is also a key consideration to both consumers and marketers of a products image. Our image of a product is bound up with self image and what we consider approach for ourselves.

The motivational Mix Multiple motives e.g. shopping, people dont just go shopping to shop. They may include: B S Patil

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Shopping gets you out of the house breaks up the routine Form of entertainment window shopping is free Shopping allows social interaction Makes people feel important and needed as the household provider Larging it over shopping assistance makes people feel important/powerful Hunting bargaining skills Approach and avoidance Lewin (1930s) suggested that motivational pressures can either be positive or negative indirection ; that we may feel pressure to move psychologically towards a goal object or away from it avoidance. Conflict can arise in three types of situation where the motive strength are about equal. Approach Approach A common approach for deciding between alternatives, both of which are desirable. Two good holidays. Avoidance Avoidance Conflict the opposite of the above. The consumer has to decide between two equally undesirable alternatives. By nature people are tempted to put of making a decision, because whatever happens will be unpleasant. Approach Avoidance conflict The conflict between positive and negative, usually of a single product. The usual being the price of a desirable items is just about affordable but no more. So the positive aspect of owning sometimes is offset by the negative of the cost. The force of inertia Unless we are actively seeking certain products we will follow our established buying habits which like any other habits will have been learned over a period of time become part of our life. Changing habits can be tough so overcoming the forces of inertia requires a great effort. Involvement Herbert Krugman first suggested this concept in the 1960s. The relationship that a consumer has with a product, as it refers to the personal importance that a given product in a particular individual has. What does it do for the needs and values that are behavioural expressions of his self image? The greater the involvement of the individual with the product and its perceived benefits, the more motivated he is to buy it. It is therefore crucially important to realise that in following discussion of involvement, it is the way the individual consumer makes sense of the product and the situation and so on which is key.

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Antecedents of involvement These are the factors that precede involvement and determine that degree of it. Person: This set of factors is concerned most definitely with the consumers self image and the needs, drives, values interest, wishes and fantasises that can be translated into buying behaviour. Some people have close relationships with their cars, notice and care about cars in general than people who do not. Product: People react to the same product in different ways. Therefore it is the consumers perception of the product interacting with the personal factors that affect the level of involvement. As the level of involvement increases, the greater differential the consumer perceives between products. E.g. Whiskey tasting perceived differentiation the less generic, the more specific a product is, the more scope the consumer has to develop a relationship with it. Situation: Involvement can also be influenced by the situation a product is being purchased. E.g. buying a gift rather than for ones own use. What also would factor in here is how we want the recipient of that gift to perceive us. Properties of involvement: Refering to the feelings that consume experience and the behaviour exhibited when their involvement is aroused. Consumers who are highly involved will take a great time and effort in making a purchase decision. They will seek out information on different brands and models etc. They will pay attention to advertising. They will process information thoroughly and critically and they will be swayed more by the context of the argument than the style. Actively engaged. People with low involvement who are more passive recipients of information. TV is a passive medium which requires low level of involvement. Print advertising requires closer attention, more effort is processing content and therefore higher involvement. Outcome of involvement The outcome of involvement will depend on the two preceding factors. The passive consumer who allow TV and other advertising to wash over them without registering. Brand names are not implemented and consumers will remain uninvolved even after a repeated exposure. A heavily advertised brand may be enough to get a low involvement consumers to buy a product and may enable them to develop a relationship with the brand this wont stop them buying other products though.

Specific needs each of the below needs is considered to be of a particular importance in our society. Achievement affiliation and power. B S Patil

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The need for achievement Henry Murray noted the need for achievement as one of the twenty needs motivating behaviour. Murray developed the Thematic Appreciation Theory (TAT). Dave McClelland used the TAT to concentrate on the need for achievement he labelled this the n arc. People on the n arc have a preference for particular situations where: The degree or risk involved in is neither high nor low moderate Feedback on their performance is required Individual responsibility is acknowledged

Moderately risk task would provide a reasonable probability of success for people high on the n arch, whereas low risk situation would be unchallenging failure on the other hand would hurt their self esteem. A sense of personal accomplishment is crucial to people with high n arch and this would place them in the self esteem of self actualisation categories in Maslows hierarchy. Need for affiliation This would be placed lower than the need for achievement in Maslows hierarchy, in the category social needs this need is characterised by the importance to the individual of love and the acceptance and feeling of belonging to groups, like family, peers, sports teams and so on. Teenagers would be an obvious target struggling to establish an identity of their own. Coke and Pepsi appeal to this need. Need for Power People who are trying to control as much of their lives as possible, so this would appear on the bottom Power/Safety. Successful managers might be high on the need for power and low on the need for affiliation. Unconscious Motivation: There are times when we literally do not know why we did something. Motivational Research: Restricted to the workings of the unconscious consumer motivation.

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Creating needs: Can needs be created? There is no evidence that anyone can create needs. Marketers and advertisers can try to stimulate an existing need or channel to a certain product or brand results are quite unpredictable. Semiotics the meaning that signs and symbols have for people both consciously and unconsciously. We are not usually aware of it we live in a world of signs. Research has focused on small scale and concrete symbols partially animals like penguins, diet coke etc. Because symbolism is by its very nature non verbal it makes psychological interpretation which is never easy. We can only make an educated guess it if anything symbol means to an individual consumer. Sometimes a cigar is really just a cigar Freud. Dichter was asked to investigate the declings value of prune sales. People like them (taste) but they were put off by the symbol. Associated with old age they are associated with associated with health problems, low prestige and parental discipline. Summary Motivation ramifies though out the study of consumer behaviour appearing in discussions of leaving personality, market segmentation and attitudes. It is primarily concerned with links between cause and effect observed in behaviour. Maslow deals with individual needs and fulfilment. Other needs such as power, achievement and affiliation are of particular interest to researchers. Maslow Physiological, safety, social, self esteem, self actualisation Specific Power, affiliation, achievement The degree of psychological involvement a consumer has with a given product is thought to be crucial to understanding has motivation towards actual buying it.

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As much of our motivation is unconscious the symbolic interpretation of consumers responses to products has an important place in this field as does the more social interpretation of products as symbols represented by the study of symbols.

Family Influences How does our upbringing affect us as consumers? Margaret Thatcher: Our beliefs are fashioned in the family when we are growing up and our experience of it affects us for the rest of our lives. What happens in families seems to be of great interest to everyone, e.g. soap operas etc. When we try to isolate particular behaviour like buying and consuming specific products and asks what affects family relationship have one them. Family a group of two or more like people living together who may be related by blood, marriage or even adoption. Families may also be nuclear consisting of a husband, wife and children (McTypical). They may also be extended over time to include grandparents, or psychological being cousins and more distant members. The family one is born into is known as the family of origin (or orientation). The family one helps create by reproduction is the family of procreation. Because the family is also a social group indeed the prototypical social group in any society there are two other defining terms that should be monitored. Primary Group and reference group. Every family is a primary group because of the face to face interaction that takes place on a regular basis. Families can also be reference groups up to a point as long as members refer to family values and ways of behaving as a guide to their decisions and actions. What constitutes a family has great importance to the marketer. That is apart from the effects that our family of origin has on our individual consumer behaviour, the family as a buying organisation exercises enormous economic influence.

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This is why markets have a vested interest in understanding and supporting the concept of family. E.g. Christmas season prime time for consumption. Changes in family In western societies the extend family is quiet rare. It is also rare for the man to be the sole bread winner, the rate of divorce has also increased. The extended family in other areas of the world are very important it also exists within ethic subcultures. In the west young people left the homes in search of higher living standards. Many more women are now in the world place too.

Household Refers to all the people whether related to each other or not when they occupy the same unit of housing, where people live rather than whom, thus making it a more inclusive term than family covering nearly all of the population. Soldiers, monks, prisons etc those who reside in institution are not part of a household everyone else is. There is of course overlap and those living alone are also considered a household. Socialisation The process whereby an individual becomes a social being. Although a life long process it is considered important in childhood, when society is represented by a child parents, as well as the rest of their family. Socialisation is therefore the way in which a child becomes a functioning member of society. Socialisation is a two way process. People influence their social behaviour and from birth onwards are influenced artificially to enable us to study each more closely, but in real life they are closely interwoven. Childhood Some newborns are more active than others. This means that people will react to them differently and have different expectations of future behaviour. The infant in turn will react to their reaction and the process of socialisation and constructive of personality have begun. Children and parents can manipulate each others behaviour. The effects of institutions We all live our lives among groups of people. Some groups are more important to us than others in our socialisation. B S Patil

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Family Most children live their lives with their family before they go to school. Freud and others argue that a childs experience are crucial in determining his adults personality. Parents are all powerful, no matter how benign. They know all the answers so their way of dealing with the world becomes the childs way of dealing with the world. As they grow up children, can then put their parents the wider social perspective. In a psychological sense childrens parents remain with them in some form for the rest of their lives for they will have internalised what they have learned from the them. One thing is they would have learned what being a consumer means. So emotionally important ones like food consumption people may retain for the rest of their lives the eating habits and preferences they learned at the family dinner table or the family tv set! School - Children become part of the world and must deal with it alone. Children learn how to behave in an extremely complex society and maintain and develop their own individually. As children go through school, their peers will become more important in influencing them than their parents. e.g. dressing, dealing with authority, trying to fit in yet remain individual. Nation State - Once a person has become an adult socially, they are recognised as such by the state. The age varies and it should be noted that a persons perceived age is different from their real age. The nation state is the most important single fact about the way people are divided in the planet. National government is the only source of legitimate power in a country. Controlling the police and Army. It has the ability to raise tax and pass law. Different nation states produce different types of social being people are taxed, vote, drive and fight under similar but different system of values. The values in turn are related in different educational systems and family patterns. The institutions of the family, school and nation state are all linked together, of course and normally share that same values and reinforce the same kinds of behaviour. Consumer Socialisation Parents do not give specific training in the training in this area, they act as role models. Co-shopping usually is a mother child thing and is a very useful way to spend time together in todays busy world (tow birds with one stone) on such trips children learn about budgeting, choosing between products, brands and quality. Co-shopping once again is a two way process. Teenagers may be more trends aware and assist their parents in decision making. E.g. environment movements etc. Then adults can do similar things for their older parents.

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Family decision buying When dealing with the buying decision of a family, the problem (of finding specific decision causes) is more complex. There is usually more than one person making the decisions or influencing the person who makes it. Family Roles The instrumental role is one of providing material support and leadership and is usually by the father Mr Mctypical. Whereas Mrs McTypical is expected to perform the expressive role of giving emotional support and aesthetic expression. There are many specific roles to be player in the course of a family purchasing decision. The following are the most frequently used:

Initiator the person who 1st decides theres a need or raises the idea to buy something. Influencer An opinion leader who provides information and persuades the family about what to buy. Decider A family member with the authority to make the buying decision himself. Buyer the person who makes the purchase. Use the consumer Gatekeeper Letting crucial information through the gate or net. e.g. mentioning a concert to a teenage or buying fat free dessert. The role the family members adopt may depend on which spouse is dominant and for what product. 1. The husband / wife may be dominant. 2. The partners may be autonomic an equal number of joint decision made by each 3. Syndicate decision made jointly

Resolving Conflicts Any group of two or more people are bound to have disagreements there are four main strategies that families will use: B S Patil

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Coercion Invariably used by the husband, by expertise, authority and threats Persuasion reasoned argument, presented in a reasonable manner. Bargaining give and take making concessions/bribery Manipulation Purely psychological strategy that is used by any family member, sulking silence, etc etc. Changing Roles Families go to great lengths to avoid open contact, especially with important decision. People may not be aware of their partners preferences until the process begins. So it is it therefore difficult to bring any of the above strategies into play, more a case of muddling through. With greater sexual equality decisions are becoming less husband and wife specific, with more discussions and negotiation taking place. Although attitudes change in behaviour usually lags behind.

Life cycle effects A convenient and often used way of summarising family effects on consumer behaviour is the family life cycle. This is an external view form a sociological view point. Bachelor - unmarried under 35 low income bit few financial burdens to bear. Lots of disposable income. Buys gadgets, cars etc. Newly married honeymoon stage relatively good financial health two full time income and no children. Costs, mount in terms of spending on setting up new home etc. Appliances, kitchenware etc. Full nest - First children and marks the end of the honeymoon period. Major changes in consumer behaviour. Moms stop working, drop in income with expensive new arrival. Spending curtailed junk food restaurants instead of real ones debt levels high. Full nest II - youngest at least 6. Mother may return to work, husband earning more. Food is a heavy expense childerns interested and education takes up income. Full nest III Progression of previous stage kids now in their teens. Empty nest - Children leave home, parents still working at the peak of their incomes. Items more luxurious, in terms of travel, recreation and gifts. B S Patil

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Children could possibly return home Empty nest II - Now retired children left home maybe down size, likely to buy medical products. Solitary survivor Spouse dies, still in the world of paid employment in same market as retired couple. Retired Solitary survivor As empty nest II insecure and lonely.

Non family household Single people are on the rise. They tend to be insecure and worried about how they present themselves to the public, could be pre-married, divorced etc.. Summary Families provide the emotional environment in which we are reared, however nurturing or dysfunctional that they maybe. Usually the family experience occurs within a household of people sharing the same accommodation. The family is the first major social institution to socialise its members, followed by school and the nation state. Socialisation is the process that is brought to bear on individuals with the aim of bringing out the social nature of their personality and providing them with knowledge of the appropriate behaviour expected in a given situation. Family buying is a complex and difficult process. Different members of the family have taken particular roles in this process that seems to be changing. Conflict maybe involved and families have evolved ways of resolving. Following the family life cycle is a useful way of analysing effects of family life on consumer behaviour.

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Social and developmental influences How does our psychological development affect our consumer behaviour? Families look at the way humans are socialised as opposed to the individuals we become. Part of the process of being in a family is learning how to be a consumer by co-shopping with parents and by acting as role models. Socialisation will be examined, individual development, both mental and emotional, in children and adolescents and how that development is affect by the various social influences that children come into contract we as they grow up. Maturation process, the development of the economic mind and the psychology of money. Socialisation and individual development

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All individuals develop psychologically as part of a growing up. Though in different ways, and at different times they are all open to influences form their external social environment as well as their family. This is not something that can be shielded against. It is important because it interacts with the individual process of development, and inevitably makes it more complex.

Maturation Psychologically described as: the process of growth and development which are common to all members of species and appear regardless of individual heredity or environment It is through this type of process people are able to walk, talk and think regardless of who their parents are or where they live or how much money they have. Abilities due to maturation will therefore appear in the growing child, according to an inborn biological timetable. Parental encouragement will only be useful once the childs brain is ready to fulfil the function, walk, talk etc. The child will be ready when its ready. Stages of development There is a maturational process that every child has to go through in order to acquire adult mental abilities. As the brain grows and develops the B S Patil

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child is able to think and reason with ever increasing complexity. Jean Piaget identified four different stages in the childs progress. a development process taking place in a series of non arbitrary, sequential and progressive steps, each of which subsumes each proceeding steps In order to have adult thought processes every child will achieve the same sets of mental abilities in the same order and at roughly the same age. Every new stage of development will not only included all previous learning, but will also transform it, so that the same world will be understood differently. This was Piagets contribution to psychology. Piaget identified four stages by the use of systematic experimentation he was able to demonstrate that children perceive things in a different way to adults. The process of development from child to adult is no ta gradual increase of knowledge, but rather a progressions. Sensory Motor stage (birth years to two years) Language and symbols only play a small part in the development. Concerned with discovering their own bodies and their growing power to act in their environment. Object constancy objects are removed from the childs field of vision, they no longer cease to exist for them as they had before. Objects are separate in their existence they can hold the image

Preoperational stage (2-7) The acquisition of language and the use of symbols characterise this stage of development. Word, names of things are magical, they believe the name is part of the object, it couldnt exist without a name. A child could become upset if someone called them a bad name. Child does not yet understand the principle of conversation Concrete operation stages (7-11)

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Child can understand conversation and can classify people in more than one category (e.g. uncle Lee, can also be brother to Brendan now). Begin to grasp the physical properties of things, their quality, numbers, weight and volume remain the same even if appears change. e.g. water in a small glass, same amount in a large glass. They are in a position to know what the world is really like even when it does not agree with their perceptions of it. At this point they are capable of absolute thinking. Formal Operations stage (11+) The ability to form concepts and to think abstractly is the final achievement in children s intellectual development and these appear some time after 11. Logical reason is an accomplished at this stage. Children are no longer dependent on physical objects that can see and manipulate. They can now work things out in their heads, by late teens, they are cognitively adults. Assimilation and Accommodation As maturation unfolds children are trying to adapt to more and more complex world presenting them with new information all the time. There are two parts to this process. One is assimilation whereby information in the world is assimilated into their cognitive system. The other part comes into play when childrens thinking is not sufficiently complex to let them makes sense of some information. They are forced to re-organise their cognitive system to include the new situation. This is accommodation. When a particular crucial accommodation is achieved they can move onto the next stage of development.

From egocentric to reciprocal During the earlier stages of development the world of children centres on themselves. They know how the world looks to them buy cannot visualise how it would look to other people. This view is egocentric (Piaget) as the child develops they acquire the ability to decentre from themselves and put themselves in someone elses place. Learning to play by fixed rules etc.

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Reciprocity cognitive achievement that forms the psychological basis for adults social behaviour is all organised human societies. This allows us to deal with concepts like equity, impartiality, justice, fairness concepts that have a bearing on our economic life and roles as consumers as well as citizens. Differences make more sense than similarities Children can understand the differences between things more easily than they can understand the similarities. This ability to see similarities as well as differences is often a difficult intellectual for adults as well. It is suggested that it may require more cognitive complexity than is needed to identify differences along. Easier to teach differences, than similarities. Similarities have to be sought out and even when the child is intellectually capable of handling such concepts there is little reward in doing so. Language and culture Language is linked to symbols that are embedded within cultures. So one set of symbols would be learned for Estonian and another with Japanese. A language reflects the things that are important to the people who speak it. Time for instance is of great importance to English and German speakers. Some languages African language of Schambala in which there is only today and not today. This would ruin a Germans day the entirely culturally different concepts. This the thoughts and culture that is reflected in a language is also shaped by the use of that language. The manipulation of language by marketers is a pervasive feature of our consumer environment that we have to be socialised not only to accept it but not even notice it.

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Development of economic concepts As with the case of general cognitive or mental development the development of understanding about a specific concept also comes with fairly clear stages. Economic concepts like price, wages, PnL, investment, savings, credit and so on need to be learned, unlike Piagets stages who suggested the development stages he explored are move biological. For Children growing up in Communist countries terms like profit, credit etc etc have virtually no meaning. Children with exposure to such functions will tend to have a better understanding than those who do not. Economic concepts rely on interaction rather than cognitive maturation. Researchers have come up with a broad three phase model that can only loosely be applied to particular ages: Phase I : Pre-economic Children in it do not by themselves understand the key role money plays in economic exchange, they may have some experience in dealing with money. Phase II: Micro-economic The child then understands the concept of economic exchange, like buying and selling on individual level but not on a societal level. Phase III: Macro-economic Children understand most though not all form of economic exchanges and the networks and institutions, like banks which link them. External influence on consumer socialisation As well as family as discussed in the last chapter external influences include:

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Parents Mother-child influence is of specific consumer importance. It is unlikely that more educated mothers are better able to help their children understand the economic concepts surrounding consumerism. Have an allowance seems to help children develop economic and consumer understanding at an earlier stage. Middle class children tend to receive less allowance than working class children but they tend to save more of it. Which is probably carried onto adult life e.g. target credit cards to the working classes. School three ways in which schools contribute to consumer socialisation: Peers: Opinions are more important than parent. It is crucial to play the right games, right toys, wear the right clothes etc. Teachers: Are not trusted any more than parents. Courses: like economics and business will help however most schools do not teach consumer behaviour. Social needs A social norm is the behaviour of people in a society and that which is considered normal. By studying norms it allows us to predict the behaviour of others with a high degree of accuracy. Such prediction is necessary for societies to exist e.g. driving on left in the UK. Social norms are reflected in a similar fashion in the consumer socialisation of society children. Different countries emphasis different familiarities of understanding of different concepts e.g. Kenyan children have a better understanding of trade due to barter in their society. Marketing and advertising In some countries direct advertising to children is forbidden. In America children see c. 20,000 commercials a year. Summary We all go through similar stages of development in our understanding of the world and human behaviour. The nature of this is affected by language and the culture we are born into. This holds true for consumer as well as other types of behaviour. So the development of economic concepts have both universal development aspects to them and a specific aspect depending on the social environment the child is raised in. The most important influences: Parents, school, social norms and specific advertising. B S Patil

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The influence of small groups What are the effects of group pressure on the individual consumer? The family is the first experience we have of groups and forms the psychological pro-type for our dealings with the group. It is of psychological importance and cannot be over estimated. In terms of consumer behaviour its influences are more general than specific. We need to examine other groups too when examining the consumer action of adults. A group is a concept that can be applied to entities as diverse as a couple of roommates and a world wide religion. Both of which have an effect on consumer behaviour and can only be surrounded by a definition not encompassed:

Two or more people who regard themselves as a collectively and interact with each other while sharing the same norms
Types of group Primary group are small groups of face to face groups. That are small enough all the members can sit around a table and see each other directly 4-8 members. Most people belong to several of these groups at a time e.g. family, coffee club etc. Secondary group membership is too large to be considered a small group. 20+. What groups of this size might do if they are sufficiently close knit & split up into two or three primary groups. If someone does not know all the members and does not interact with them, then the group is of secondary importance. This group may be a transnational company, a professional association or even a religion and might have a serious influence on the individuals sense of identity not the less. E.g. CIMA you can advertise to them re new calculators, church news, political group etc. Formal and informal group These groups vary in the degree of structure and organisation. A group with membership etc is a formal group and a group of friends who meet for lunch is informal. As with primary or secondary groups there is absolute cut off plenty of grey areas , ad hoc groups are probably most common. E,g. It gets together for a purpose to stop motorway being built or do this do that then dispands.

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Membership and reference groups A group that someone belongs to or would qualify for member ship in. As a child you can have no choice of your groups youre born into them social class language or religion. Adults are however have a choice, e.g. membership of a chartered this or chartered that. Even for adults then may not be a real choice if you want to be a lawyer you have to join certain formal groups. Children for example by the age of two learn they are boys or girls and may/ or may not conform to that, girls dependent conformist, boys rugged and independent Marketers are aware of this, they are also aware that women are now rugged and independence with money to spend. In comparison to a membership group is a reference group. Which is a group with which people identify and whose norms and values, judgements and behaviour they follow (refer to) whether they are actually accepted to this group or not. For example lighter skinned black people trying to be whiter due to the negative image of actual blacks. The way to express this is by the products they use. So their membership group is black, but their reference group was white. Reference groups are also known as aspirational or symbolic groups because individuals aspire to leave their membership group and can be accepted by their reference group or identify who symbolism values or behaviour they admire. Properties of group life It is important to understand they way people behave in groups and the effects of group influence. Unintended group influences Couples tend to have similar patterns of consumption to each other, pattern which are systematically different from couples who meet in different kinds of neighbourhood (this assumes that the couple are from the same neighbourhood, so no social climbing / declining). This is an extension of geographic segmentation. Word of mouth and opinion leadership Friendship patterns are important to consumer behaviour as ones friends are the source of advice and word of mouth referrals. Opinion leaders, leadership is situational depending on: It is usually specific to a particular product or category

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It is a relationship between at least 2 people where the influence goes both ways

Opinion leads are sometimes known as market mavens (expert) Conditions necessary for someone to exert consumer influence. On going personal relationship The other person is an expert in their field You do not personally have the information to evaluate the product You do not trust the vendor sales pitch e.g. Ed Peck consulting on PCs. Group norms and the power of conformity As adults group norms have become internalised that we are not conscious of them. It is only when we go against the norm we realise how powerful the norm is. Conforming is the norm Soloman Asch line experiment, lines of different lengths groups of people saw lines of different lengths, upon discussion they agreed lines with the same length or a opinion leader influenced the others on line lengths. People shift judgement due to norms and conformity is the overriding norm. Cruchfield followed on from Asch 80% of people conformed. Conformity and consumer norms Most of us feel uncomfortable if our buying behaviour is out of step with others. People who do not mind such conformity are likely to be opinion leaders. It might just take the support of one person to make conformity resistible. Most of us accept only silly opinions if they are the norm e.g. Bermuda shorts, donkies from spain etc.

In western societies how do we reconcile the prevailing ideology of individual consumer choice with the reality of enormous conformity pressure? Since Ford and the advent of mass production, with its highly profitable economies of scale, it has been in the producers interest for all consumers to want - or at least accept the same product, to maintain the fiction of free choice.

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Where there is no real competition on product provisions it is difficult to know how conformists, as opposed to manipulated consumers really are. Consider the difference between the car industry and the home entertainment industry. The cars we drive today are recognisably the same product that came of the Henry Ford assembly line in 1912. In the meantime there is wire, plastic less steal, but they are controlled, powered and used in the same way. Home entertainment industry, 1913 the best people could hope for was a piano, now people enjoy a plethora of multi media & web based applications. Why? Producer cartels were not able to get such a lock on the manufacturing process and the Japanese entered the market quite early. Indeed when Japanese cars sales began to take over the Detroit companies in the 1980 s, only then did competition take place. Power Another way in which group life may affect the consumers behaviour of individual is through their perception of power the group to influence them. Reward power the ability of the group to give people something they value. Either material or psychological form of acceptance or recognition for certain behaviour, increased status, bono etc. Coercive power The opposite of reward power. It is the ability to punish or withhold reward from the individual. E.g. having to wear certain clothes or be punished by lack of acceptance. Interesting to observe in the work place. Legitimate members perception that their group has a right to influence them as consumers would be considered cognitive power in action, e.g. parents, government, health care and doctors etc. Expert power based on the possession of knowledge or skills that the individual consumer values. Opinion leaders, is obvious but virtually everyday someone performs this function at one time or another. Referent power the emotional identification that the individual has with a particular group or with some prominent person who represents the group to the individual. The closer the identification the more influential is the referent power. E.g. showbiz, celebs related to a product. Reference groups and consumer behaviour Where someones reference group is not their membership group. Conformity pressure and specific influences B S Patil

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Asch is the classic study in this field. The group was naive to the subject matter so felt pressure to conform. The same for Crutchfield study of social and political opinions as well as arithmetical problems. Direct influences of conforming pressure can be identified in actual buying situations where members of the group know each other and the need for social approval is particularly powerful. Indirect influence Milligram studied conformity to the norm of obedience where our behaviour is strongly influenced by reference group that is not physically present. We are very concerned about what other people think, who we feel important to us. E.g. a husband/wife scenario in a purchase decision. Variability of products How exclusive the product is and how it is used. luxury necessity and public-private e.g. using a sail boat a luxury good in public, or a private necessity a fridge. Public necessity: A suit (something most people wear) reference group will be weak, but because the brand will be subject influence, e.g. the perception it carried. Public Luxuries: Reference group will be strongest in the sector because the product is visible and relatively exclusive e.g. golf clubs. This influence will be external to a particular product than a brand. Private necessities: reference group at its weakest. Not many people care about a mattress. Group influences should be minimal.

Differences in consumer susceptibility Group factors 1970s study found students tended to be more susceptible group than housewives for example students have more contact time with their reference group and their peers are important to them. Students are less specialised, experienced consumers than housewives. The more an individual feels that the belong to a group the great the influence on them Individual factors

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Those individuals who were more resilient to conformity pressure were people who were generally self confident and high in self esteem. They are confident to go against group norms they had the self esteem and confidence, to discuss and press their opinions. Such people are likely to be innovators. Marketers might enlist their help. Summary We live our lives in groups, an understanding of the interactions between individuals and the group they belong to is crucial to an understanding of consumer behaviour. This is particularly true of small primary groups where the psychological dynamic involved have been studied. Secondary groups are of great importance as an individuals reference group and membership groups. Patterns of interaction between people are a key feature of group life. Word of mouth is a key element in the buying decision especially when opinion leaders are involved.

The most important aspect of group life is the pressure on the individual to confirm to the groups expectation. The effect of it on many forms of purchase decisions is immediately evident in our lives. Consumer aspiration, identified by their buying behaviour is seen as members of a particularly valued reference group.

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Influence of Social Class Concept of social class, how it is measured The importance of status symbol in consumption Effects of social class on consumer behaviour How does the social class affect what we buy? College professors and used care salesman may make the same amounts of money, but they will spend it different ways. One way of segmenting is by socio economic status, which is determined by education and occupation as well as income. Social stratification Class comes from classsis which was used by Romans to classify the population by wealth and administration. Social stratification has been around long before the romans, dividing society into rank ordered classes. Every country in the world has a socially stratified society. It implies the existence of a hierarchy between strata. Social strata therefore imply the existence of a fundamental inequality in the way the reasons of a society are distributed.

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Social stratification also implies that people in each stratum will tend to interact largely with people in the same stratum. The same neighbourhood and friends etc. Social statues and symbols In any hierarchical system, where different levels over rank ordered, a persons status depends on his or her own rank. Different societies ascribe the same groups different degrees of social status and in different ways. As society changes social status may change accordingly for example USSR, socialist, government etc in Russia business people UK, big brother contestants. Status and class are often used interchangeably in practice. What usually catches the eye are the symbols that denote someones status in society and the class he or she is placed. People buy products because of what they stand for as well as practical uses. The symbolic use of products is the most visible way in which people claim that status themselves. This is known as conspicuous consumption at its most visible where people are laying claim to membership in the highest social class. Only lower class people carry cash middle class use plastic the card saying more about you than cash could The Queen uses neither. Status symbols are very potent forces in organisational life; it is a cheap way for organisations to reward their staff. So when flat Japanese organisation started working in the west, there was dismay that status symbols were lost. If everyone has a Rolls and a rolex the status symbol is rendered pointless. Exclusiveness Of a status symbol is the attraction. A symbol is only a symbol it stands for something else. Psychologically it represents being respected by other people. Money buys products or they can donate it to charity all lead to respect. Success of a product or service as symbol: Exclusivity, only a few people should be eligible It should be relatively expensive It should be of good quality Limited supply

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Honoured and respected by others. May endure for a long time, but firm changes the meanings of certain symbols. Life chances and Lifestyle The primary group membership which people have is of family they are born into. The social status of the family is therefore the social statues that the individual will have. These individuals may become socially mobile and move into different stratum of society. Families at different levels of the social hierarchy afford their members different life chances for their future in society. A persons level of education, occupation and income depends more than anything else on the social statues of the family he was born into. The lower the social class, the higher the chance of leading an unhealthy life and dying young, getting a job and keeping a job will be harder. The life chances of an individual will therefore have a powerful bearing on his or her life style. People are or can be class conscious, subjective awareness have of whom might be objectively placed in a certain class because of SES or lifestyle. Measuring social class Objective methods education, income, occupation, additionally marketers add geo-demographic measures too. Single variable index only one SES criteria occupation is normally taken Multi variable index may take severable to attempt to come up with a more round view. Subjective view Getting people to rank themselves in class hierarchy, in the US people tend to describe themselves as middle class so it tends to cause a bulge in the middle Reputation method People asked to rate each other on the social class hierarchy. This method is limited to small communities where everyone knows each others life style fairly accurately, this method is less practical. Interpretive method Involves researchers interpreting the written and visual aspects of products of society for clues about its attitude and norms regarding social class behaviour. So this would involve written and non written social commentary. Not really quantifiable. B S Patil

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Social Class categories How many classes are there? Researchers can divide the population in many different ways from two to nine classes. Upper - upper upper, upper middle, upper lower.

Middle upper middle, middle middle, lower middle Lower - upper lower, middle lower, lower lower Even this broad ranging variation conceals the variations of SES factors within each level.

American Classification Richard Coleman derived his computerised statues index CSI: Upper-Upper 3% Lower-Upper 1.12% Upper-Middle 12.5% Middle 32%

Working 38% Lower 9% Lower-Lower 7% Middle and working class represent c. 70% of the total population, These are referred to as middle American what this group likes, set the agenda for producers, marketers, and advertisers as well as social, economic and political decision makers. British classification a. Upper middle (leadhouse hold, senior position in a business)

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b. Middle

(middle manager)

c. Lower middle (small tradesman, white collar, junior manager) d. Skilled working (blue collar workers) e. Unskilled working (working as labourers etc) f. Lower (casual employment, no employment)

Changing social class is the categorisation of people into social class undergoing change? to what extent can individuals change their class? Social classification needs to be updates periodically as social economic and political changes occur in a society. Peoples life style and therefore consumption patterns are still greatly affected by their lifestyle status. Look at the Blair years, how has this affected social mobility, New Labour Individual social mobility western countries pride themselves in upward social mobility The expansion of the American middle class supports this. However, in a capitalist system there is a good deal of downward moves. Marketing and consumer behaviour There is the temptation for marketers to target people in the higher social classes, in per capita terms consumers in these classes have higher disposable incomes. However, the working classes are clearly and enormous and will be a large target market (the first up-takers of Sky TV). In any society there is only a relatively small proportion of the population that can afford to live in rich luxurious life. But many more aspire to it or enjoy partaking of it on a regular basis, for a treat or celebration. B S Patil

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Marketing terms people are encouraged to live toward a life style e.g. luxury soap etc. Summary Social class is used interchangeably with socio economic status a standard or market segmentation. Social class includes factors of status and symbols of status which people respond to as individuals. There are various measures by which social class is measured and people are assigned to different categories, and these may vary from country to country. The categorisation process changes over time as methods become more refined. Individuals may move between social classes over time, socially and psychologically as individuals redefine themselves. This categorisation and redefinition of categories affects the way products may be marketed to consumers and may take themselves into or out of a market for a given product.

Cultural influences Culture is usually defined as share beliefs, values, attitudes and expectations about appropriate ways to behave. The most obvious differences are language, dress, food and history Everyone is a nation state is socialised into the national culture a process called enculturation regardless of the sub culture they belong to. When we move to different countries we must adapt to their culture a process called acculturation. Culture is something we learn as we grow up. Similarities across culture All cultures share universals such as:

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Every culture has to grapple the same universal questions; it is just the answers that are different. Culture is something we learn as we grow up. Differences across culture Language speaking the same language is no guarantee against differences in national culture e.g. scousers. The communication gap becomes quite wide in the same language come from different cultures. It becomes more pronounced between two different languages.

Non verbal communication style of clothing, facial expression, and body language. Cultural values The context of communication is often referred to as cultural values. Predictability of the behaviour of a culture is crucial to marketing strategies.

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The difference in cultural values can lead to business failures. In the USA households items are convenient disposable items. In Europe it is consumer durable (e.g. washing machine). This does not fit with American values they will not understand why it is more expensive etc etc. Going back to the image of self Germans may have more concerns with it than Americans, e.g. they spend more money on it, it is therefore more important and therefore more of a reflection of themselves than what an American would say

Ideals Are usually not attainted in practice, they represent an ideal state of mind. Actualities represent more everyday lives that people actually lead. Differences in cultural values The cultural values of two countries are clearly evident in the way their children perceive the social world. Subcultures Ethnicity has two components, national origin and race as well as religion. In terms of products, Hispanics have different food tastes to Anglo Saxons as do British Asians from Anglo Saxons. Race, black people spend more on symbolic spending luxury items e.g. Ive made it rather than delayed gratification. Religion e.g. dont try and sell booze and bacon to Muslims. B S Patil

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Changes in culture Always in the process of change e.g. England a land of migrants through time. One important method used to track this is called content analysis culture. Summary Culture is important in understanding consumer behaviour. Similarities between culture are difficult to see but they cover a while range of human behaviour. There is a trend towards convergence of culture due to the impact of globalisation and global communication, this trend this to deviate towards to the USA, e.g. Coca Colonisation power of informal empires via products and envy. Difference between cultures are still apparent, however, more so than similarities. There are verbal and non verbal communications this can lead to pitfalls in marketing, lack of cultural understanding and sensitivity can cause problems. For example using words that arent suitable in advertising logos. The influence of subculture within main stream culture has to be dealt with, this presents opportunities and threats, and this must also be considered against a background of on going cultural change in the world. - a snap shot of

Attitudes Attitude a stable long lasting learned predisposition to respond to certain things in a certain way. The concept has cognitive (belief) an affective (feeling) and conative (action) aspect. Stable once formed will keep that form Long lasting stable over many years Learned we are not born with an attitude Predisposition to respond links to actual behaviour In a certain way emphasize consistency Attitude components

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A measure of any single one the three components could be very misleading. Even intentions may not indicate buying behaviour.

Forming attitudes - no one is born with a particular attitude 1. classical conditioning 2. Stimulus generalisation 3. Stimulus discrimination 4. Operant conditioning or reinforcement 5. Cognitive learning

Source of attitude Family B S Patil

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Peers Direct experience the greatest former of attitudes Theories of attitudes Single attributable model measures of the components attitude. Multi attribution model:

Behaviour intentions model Adds a measure of intention to the model the model can also be amended to allow for the attitudes of significant others called Subjective norms. Fishbiens Model not helpful in explaining odd behaviour e.g. going out for bread and coming back with a load of smutty magazines. Changing attributes Three main forms 1. Mere exposure 2. Persuasive communication 3. Cognitive dissonance B S Patil

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Usually market leaders are most interested in strengthening attitudes than in changing them. Competition will have to gain from changing attitudes. (e.g. swatch vs. digital) Strategies Low consumer involvement - use an advertising blitz to condition Increasing involvement - try to associate the products with a cause or issue Involvement use the multi attribution model Involvement and the multi attribution model Change belief (bi) involves changing the consumer beliefs about the benefits that would result from purchasing the product. Anything that claims to last the longest be the most reliable or gives best value for money, would use this technique. Changing evaluations (ei) changing the way a consumer evaluates a product. E.g. a tin of beans, traditionally viewed as cheap foods, get people to think they are trendy and hip and / or healthy. Changing beliefs and evaluations (bi ei) removing or adding attributes can change the combination of beliefs and evaluations for example adding fibre to bread or removing caffeine from coffee.

Cognitive dissonance studies show that if the appropriate behaviour comes first them more than likely the attitude change will follow. Behaviour is more resistant to change than attitude.

Summary An individual attitude can be divided up into three components, cognitive (beliefs), affective (feelings) and conative (actions). It is important to note that all attitudes are learned, in the various ways that people are capable of learning and we are therefore open to change. The source of our attitudes towards a specific product maybe our family, our friends, or our own direct experience. The study of the attitude involved in making consumer decisions has led to the development of mulit-attribute models of attitudes. Some of these models attempt to quantity likely buying intentions. The psychological process that lead to the formation of attitudes is also very influential in any change which occurs in them through other processes may be involved.

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Leading companies in any market are primarily concerned in strengthening consumer attitudes towards their products; it is their competitors who are most interested in changing those attitudes. There are various strategies for changing consumer attitudes depending on how much involvement the consumer has in making a particular decision that is how important it is to the consumer to differentiate between the products on offer. Relationships between attitudes and behaviour, it appears that while a change in attitude can lead to a change in buying behaviour, the reverse is also true; a change in buying behaviour can lead to a change in attitude about a product. The key factor appears to be the amount of consumer involvement in making the decision. With high involvement attitude can change behaviour, but low involvement behaviour can change attitude.

Communication and persuasion How advertising affects consumers An analysis of the communication process How we deal with advertising communication Cultural effects on advertising communication

How does advertising affect our behaviour?

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The most obvious form of persuasive communication is advertising. Its primary purpose is to persuade people to form or increase, positive attitudes or intentions towards a particular product. We need to understand how we process advertising in order to understand the persuasive elements. The importance of advertising Universal and persuasive, more and more local outlets being used - now the internet which can get us via blackberry etc. Average American exposed to in excess of 100,000 per annum some people attitudes towards advertising is one of fear and suspicion. Some think they can see through it sophisticated consumers that we believe we are.

The process of communication

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This is the general model for the communication process, but it can be applied to advertising. The sender initiates the process by transmitting a message about its product. The message can be encoded verbally or non verbally or in a combination of the two, if the medium allows. The intended recipient is in a target market audience that is selected for this product. The receiver then decodes in a way that makes sense to him. The goal is for the receiver to perceive that precise message that he or she encoded and it influences the receiver attitude and/ or behaviour in a positive direction. There of course are many pitfalls on the way to doing that. language barriers, cultural relative / sensitive issues. Communication issues or

The source (sender) two important factors that determine the persuadability of the communicator who is the source of communication aimed at changing peoples attitudes, credibility and attractiveness. Credibility The communicator should be perceived and an expert and trustworthy. Arguing against ones interest is especially effective. Fast smooth talkers seem to be more positively perceived than slow hesitant talkers. Sleep effect a not so credible spokesperson gives a message after a time the sender is forgotten and the message is remembered. (message more important than the deliver) B S Patil

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Attractiveness If the above is true, why does Roger Feder advertise shaving products? Using celebrities, it is said this technique works only up to a point on a trivial issue. attractiveness draws consumers to a product. Sometimes of course there can be a problem e.g. tiger woods after he nailed all those birds. The communication (message) Several key questions are considered in evaluating the effectiveness of the message: Reason or emotion modern research looks more into the effects of different level of emotion rather than the distinction between the two. It seems to be the combination of high emotional arousal plus specific institutions on what to do that is most effective. e.g. drink and drive advertisers what levels of emotion and reason to playing on. More people have fear the more likely you can influence people by communication. Emotion and instructions. Image of statistics A picture or image is more effective than words. One sided or two sided argument for uninformed people or people that share the same opinion one sided argument approach is more effective. For well informed people or for people that dont share the same opinion the two sided approach is more effective. Size of attitude discrepancy It is much easier to charge the attitude of the target audience when there is only a small discrepancy. E.g. the further away the target are from the message the harder it will be to persuade them The audience The final set of factors will deal with the concerns of the audience. Pre-existing attitude of an audience and the extent to which they are informed about the relevant issue can affect the persuasiveness of a given message. Self esteem it seems that people with low self esteem are much more susceptible to persuasion. Miligan and Asch conformity studies, people with low self esteem are more susceptible to the implicit influence attempts.

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Prior experience generally we may be perusable when a belief we take for granted is questioned. We are unused to defending this belief and lack the time to marshal the arguments in its favour. One way of defending against such an attempt of persuasion is to be inoculated against it by prior mild form of argument. Forewarning people is another way as it gives people time to muster their thoughts. Public commitment When people make public commitment that differ from group norms rather than private commitment they are more likely to change their behaviour. Family would be a good way of attempting to amend group behaviour. E.g. Lewin convinced housewives to buy offal. They committed publicly to eating / trying new recipes. (as part of the US War effort in WWII). Mood What type of mood is the consumer in when exposed to the advertisement, and how this mood will affect the response. Context and Content should be upbeat and happy. Feedback and evaluation Elaborate and likelihood model (ELM) Suggest there are two different ways to persuade consumers via communication. The central role when the consumers involvement and motivation to assess the product are high and vice versa for the peripheral role. Attitudes towards the advertisement if people dislike the advertisement itself it might transfer onto the product. Feedback When salesmen talk to consumers in person it is two way. Very expensive to operate, the internet and other digital communication methods make this one to one interaction much cheaper.

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Cultural factors in advertising Different cultures have different values regarding commerce and consumption, as do sub cultures within main cultures. The most important cultural aspect of advertising are: humour and sex

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Not everyone has the same humour.

Summary Advertising is a long established and pervasive aspect of most societies. Its influence on consumer society is great but sometimes in ways that are not understood. Fear that will be mind controlled is generally unfounded. Source is linked with the intended audience via a particular communication and there are important psychological findings which illuminate each part of the process. -Role of the consumer in dealing with the communication - We are not passive recipients of advertising -We evaluate the communication aimed at us.

Part of the response is a form of feedback to the communicator that transforms a one way process into an ongoing two way process. This sort of dialogue.

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Approaching a decision Prevalence of decision making Methods people use to make decisions The nature of the decision making process Stages in the process Marketing implication

How people make decisions Our whole lives are the sum of all the decisions we make. Some decisions are larger than others e.g. where to live and who with, where as others are small, what movie? What soft drink to have. Financial and psychological investment is much greater in a large decision, as are the potential rewards of making a good decision and the penalties or making a bad one. Commonality: More than one possibility to choose from The outcome is not known hence the difficulty in making a choice! We generally operate our lives with some uncertainty about the future. Evaluating the probabilities of different outcomes is the hard part, more so than the decision trees B S Patil

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through the woods scenario. We are constantly making decisions we rarely realise when we are face with decision so it is taken for granted. Rationality Very rarely do we make a rational decision. Most decisions are made in a state of incomplete information, often we are not even trying to find the best solution, just a satisficing solution. Psychologically We make objective, dispassionate choices that are not influenced by prejudice or irrational influences. Economically We find out all the information there is on each of the alternatives, asses the advantages and disadvantages of the each then choose the best on the basis of a cost benefit analysis. Very occasionally we do make decisions like this, but we do not recognise we are doing it. But, the rest of the time we dont we live in a real world interpretivist - Most decisions are made on incomplete information e.g. finding a partner, getting together is the best decision at the time. - Much of the time our behaviour not thought about, it is influenced by what we have learned when young or by unconscious behaviour, we do not know about. Often we try to find the best possible alternative; what we are looking for is the good enough alternative - satisficing.

How do we go about making decisions in the absence of complete rationality? Heuristics We are all cognitive misers, meaning we try to make sense out of the situation we are in, in the simplest possible way with the least amount of rational mental (cognitive) processing. There is too much information to take in and it would take too long to absorb. Three forms of Heuristics Representative Heuristic we pick out something familiar in the new situation and equate it with something we already know. Judging quality on the basis of price for example, luxury goods from brands we know are more expressive than the

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competition, so when faced with the decision about buying a product we will often use the price as the representative. This is known as the Halo Effect Characteristic for choosing between alternative; an expensive bunch of flowers for someone we love something cheap for someone we dont like. Attitude Heuristic start with liking or disliking a product then believe what we want about it to be true. The availability heuristic The more available relevant information is the more likely we think the even to occur, This relevant data comes from our memory, we trust the validity of hindsight, we can convince ourselves the results were inevitable, but indeed, we knew that it would happen all along.

The consumer decision making process

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Stage 1 : recognising a problem The consumer perceives a need something is missing from their lives. This perception triggers the beginning of the process. The consumers problem is the gap between their actual state and desired state, so by using the model and consuming a good/service they can close the gap. Just because they recognise a problem it doesnt mean they will act upon it. They might not think the problem is important enough. They might not be able to satisfy the need. There are five causes that lead people to act upon the recognition of a problem. Changing circumstances Finances needs and wants. Finances can be negative or positive. Increase may lead to more consumption or goods that werent considered before, decrease leads to spending decrease. Needs activated by the passage of time, life style effect location, e.g. having a baby, buying baby products etc. Wants not necessities often linked to life style. Physiological maturity, increase opportunities, fashions, peer group norms etc.

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Depleted Stock What we have runs out e.g. milk or stamps. Dissatisfaction with current stock Even if our stock has not depleted enough to replace we may often be dissatisfied with its ability to fulfil its function. Clothes being obvious, could be caused by social norms. e.g. out of date Marketing influences Persuading the customer how their gap will be closed by a particular product. Product add on Buying one product will alter activated the problem recognition of the need for add-ons. E.g. first time buyers will want new furniture, for their new home. Stage II: Searching for information Once a problem or need has been recognised and the consumer is willing and able to act on it, the second stage in the decision making process is searching for information. This isnt the rational straightforward process it looks like. Decisions are more difficult when there is more information and brands to consider. Because of our tendency towards cognitive miserliness, we may perhaps curtail our search at the earliest opportunity rather than carry it through its natural logical conclusion. 1. Internal search: Undirected / unlinked learning or incidental learning. We learn the names of all the stores on our way to work. Directed deliberately try to retrieve relevant information. 2. External search: Most important source of information is other people. If you want to be more through, you will read up or consult a specialist. Many consumers do very little external searches even on a house or car purchase. Searches might be quite limited before being terminated for FMCG search time is very short. Structural factors to be considered when discussing search: Increase search Social pressure, high costs, shopping is convenient easy to obtain, clear differences in price/quality. Decrease search Time pressure product can be easily exchanged, low costs, difficult shopping conditions, influential sales man.

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Individual factors that lead to increased information search High involvement in decisions, the ability to assess, confidences and enjoyment in learning, high SES, enjoyment in shopping, high perceived benefits, affects the consumer image of self. Individual factors that lead to Low search Low involvement, brand loyalty, difficult in copying with info / sales person, dislikes shopping has past experience. Risk factor Perceiving Risk about the consequences of the decision we made. Risk should always be qualified, therefore by the adjective perceived because it is always subjective and may bear little relation to any assessment of objective reality or to someones sales risk. Brand loyalty is the most popular strategy for coping with risk. It enables us to avoid a decision. A related way of dealing with risk is to build up a set of basic beliefs or stereotypes: All brands are more or less the same Local stores give the best services More sales people more expensive More advertising better product. These are obviously generalisations. Stage III: Evaluating Alternatives Having recognised the probe of need and search for information about possible alternatives the consumer arrives at stage three, whereby the alternatives are evaluated. Criteria of evaluation this will vary from product to product. Brand names and price are some fo the criteria considered. Arriving at alternatives: the alternatives chose are known as an evoked set, when assessing we usually have a cut off point. Choosing a decision rule:

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Compensatory decision rule: offsetting weak attributes with strong attributes. The chooser then sums up the plusses and the minuses and chooses the product with the highest score.

Non compensatory decision rule: Conjunctive: if the alternative achieves a minimum acceptable standard on each attribute Disjunctive: if the alternative achieves a minimum threshold it is acceptable Lexicographic: order of importance Eliminator: Establish a minimum criteria and eliminate those not meeting it. Marketing implications Knowing the decision rules used by consumers of and the given pitfuls. The cues that the consumer uses in assessing alternatives. The presentation of the appropriate information to the consumer Cues used to create a coherent image of the product, the most important cue is personal referral, and advertising is least. Presentation o consumer information There is a fine balancing act between putting too much information and not enough on packages. On one hand you want to the information to be big enough to read and inform the consumer by you do not want to overwhelm him with information. Different consumers, seek different information.

Summary Decision making is an integral and on going part of our daily lives, so we are not usually aware of how we go about doing it. We would like to think we make reasoned and informed decisions based on adequate information that is probably the exception rather than the rule. Most decisions are solved by using heuristics, an informal rule of thumb. Representative, attitude and availability.

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The process of buying is a five stage process, recognising a pattern, searching for information and evaluating alternatives.

The decision and its consequences

The process of making a buying decision The differences between in store and at home buying behaviour How we deal with consequences of a buying decision Stage IV: Of the consumer decision making process This is what the consumer experiences at the point of the sale wherever and whenever this maybe. In store or at home. In Store Purchasing Why do people go shopping? It isnt just because they need to buy things Americans spend more time in the mall than anywhere else other than work or home. A similar figure is true of other industrialised countries. Why else go shopping? -Breaks up the routine, get you out of the house -Meet friends, exercise, e.g. a work around the shops -Free entertainment, sights, sounds, smells, e.g. events in people going to the market for the sake of it. -Sense of being important, even powerful -Hunting and bargaining skills (primal urges) -See what girls/boys are doing out especially for teenagers, the mall is part of the courting ritual. It could even be that the buying process may even be a end in itself for many people, providing a psychological gratification that is quite removed from the process of consumption e.g. people may buy merely in order to shop. How do people choose a shop?

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Of course there are many people who dont like shopping. The US 15%-25% of consumers are anti-shoppers for example couples with children would fall into this category, they might find shopping stressful, as their time is pushed as it is.

Shopping is however hard to avoid, even with the internet. Evidence seems to suggest that a decision about where to shop is very similar about which product or brand to buy. As with brand and product choice many of these decisions will be made using the least possible effort go to the nearest supermarket it becomes part of the routine. Eager or keen shoppers will be open to persuasion about their shopping venue (+50%) the anti shopper will generally do whatever is easiest and once they are in a routine they will likely not break up. Location All things being equal people will use the store closest to home. The more adventurous will go outside their area to explore, they perceived as up-market by their home crowd. Plastic Malls vs. The more homely organic stores e.g. in London people being encouraged to shop local buy local deli, groceries, Notting Hill crowd. Layout People will match their self image to shops they feel appropriate to them. Lesser known outlets and judged by their external and internal layout and overall physical impressions they present. Ambience of a place has a large effect. Music in store has been used and studied for years now people spend less time shopping, but the same amount of money when faster music is playing, slower when the music, they spend more time in the store but less time spending money. Merchandising the products that the store carries have an effect on who shops there. The pattern of product specialisation becomes increasingly blurred , price and convenience become more important factors e.g. everything under one roof. Service sales people are important to shoppers. Other services are the acceptances of credit card, gift wrapping, some who knows your habits, short check out lines all the things that will encourage you to come back. Buying behaviour Having chosen a shop, the consumer will start to buy things, what factors influence his or her buying behaviour of the point of sale; this is where the consumer and producer of goods come together. Merchandising time and planning are the two most important aspects e.g. the time people take to make a decision and the planning that goes with it. B S Patil

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Supermarket study The range of time take varied from less than a second to five minutes seconds we use is the general rule. Differences between products those that need label reading and those that dont ones with labels look longer. Only a minority of shoppers plan to buy a product prior to entering a retail outlet +50% of purchases are unplanned. These unplanned decisions are of great interest and are not just impulse purchases. Sales promotion or the promotion its self trigger the consumer memory and enable them to recall they need X or Y. This doesnt mean there isnt impulse purchasing to entice: A spontaneous urge to purchase something soon An intense motivation to override other considerations Feeling of excitement A disregard for harmful purchases Shelf level is important as are point of sale promotions, locations of displays are important. Price a frequent method used to encourage the purchase is multi-pricing where a discount is given for buying more than one item. Another is discount coupon and a straight reduction in price might be offered for a limited period. The idea of getting a good deal is attractive to consumers it encourages bargaining, hunting skills, a psychological benefit of shopping. The idea/ perception of a good deal that is important At home purchasing Internet, door to door, mail order, party planning e.g. Anne Summers, sex aides. B S Patil

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All these methods give marketers the advantages of perceive market segmentation if they know who they are targeting Segmentation of one Shopping at home doesnt have the important social/psychological benefits. However some products, home shopping is easier e.g. porn or purchases where it is convenient to go out and get e.g. a fridge. Or buying something embarrassing.

Stage V: Consequences of the decision Post purchase processes What is important here is the evaluation of a emotion. Did the consumer enjoy the product as much as they thought they were going to. Positive or negative disconfirmation

Consumer satisfaction/dissatisfaction (CS/D) An evaluation after consuming that the good does meet expectations. Expectations makes the issue more complicated. It makes an evaluation of an emotion. It is this comparison between what we expect and what we experience that is important.

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You could enjoy something but not as much as you expected. This needs to dissatisfaction. Dissatisfaction/negative disconfirmation greater than expected satisfied. How much satisfaction / dissatisfaction is a consumers buying behaviour is crucial to the marketer. Its a judgement call than a scientific one.

Dealing with dissatisfaction Its difficult for a marketer to make a dissatisfied customer to make a subsequent purchase. They are more than twice as likely to tell other people about the dissatisfaction as being satisfied. Because of the cognitive dissonance, customers routinely convince themselves that they have made the right choice, faith in their abilities as a shopper is something they dont want to loose given we consume every day. After a bad decision, the consumer can admit they made a mistake or convince themselves it was a good choice. There are limits to this of course, e.g. a faulty car, when the purchase is important to us cognitive dissonance will be at its height. Advertisements and branding will reinforce the view that the decision we made was the correct one. Most consumers are more likely to complain to friends rather than the seller. This will lead higher customer involvement. What matters most is expectations If the purchase was good but not as good as we expect we are let down by having experienced negative disconfirmation we can also experience positive confirmation. Summary Stage 4 of the consumer buying process is the actual purchase, which is either in store or at home. These are very different kinds of location in which to make buying decisions. Much of the attraction of in store for many people is social and psychological, in some regards people are shoppers just to fulfil these. Location, layout, pricing and merchandising are all important to the consumer and should be considered. At home shopping serves different needs. The final stage of the decision making deals with the post purchase process which are the psychological consequences for the consumer which are inherent in making a B S Patil

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decision. Consumers are set to reduce the cognitive dissonance which is involved in making a decision and the closer the decision between competing alternatives the greater the dissonance involved justifying / conning themselves they made the right decision.

Consumer Awareness The usage of the term consumer The history of the consumer movement Modern American consumerism Images of the consumer Unpacking of the word consumer, how the awareness of people as consumer arose? The consumer has been pictured in many different guises as having different kinds of relationship to producers and the rest of society some of these mutually contradictory. Consumer as the chooser Most prevalent image of consumer, key value of capitalist consumer orientated society that having a choice of goods and services is, in itself a good thing. More choice, more business for the economy and better as a whole for society in general, the consumers role is crucial. Keep choosing between the alternatives presented to them. The consumer as the communicator Use the act of buying and consumption to communicate non-verbally with others and themselves expressing ones feelings social status and lifestyle. Products are consumed have meaning over and above fulfilment of an immediate need. Consumer as explorer Shopping as an act of exploring, but in a user friendly environment designed to reassure and comfort while it stimulates. Hunting for bargains has moved on, we now shop in malls and the like instead of markets and bazzars. B S Patil

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Consumer as identity seeker Identity is a central concept in behavioural sciences. Defining who one is and what one values by the goods or services one buys, consumers give as gifts is widely regarded as one of the most important activities. Consumer as a hedonist Enjoying pleasure especially physical pleasure, without feeling guilty about doing so, without feeling guilty, it is therefore the antithesis of the protestant work ethic, which emphasises instead the primacy of work and earning and sacrifice as the way to fulfilment. This work ethic drives the production of goods and services in capitalist societies and provide the ideology within which people are encourage to make sense of the inherently mind numbing, soul destroying exhausting and stressful jobs we do. Yet society through its marketing and advertising also encourages people to be eager and guilt free pleasure of seeking, consumers as ever increasing consumption is good for producers to maintain a prosperous economy. Consumers as victims Not a role people want to be. But, it is argued that consumers are manipulated and exploited. Being overcharged by price cartels, badly made products which are dangerous, poorly tested drugs etc. Consumer as a rebel Consumer makes a critical statement about the values of the consumer society. They can adopt this role at anytime. Young people tend to do this, via fashion, music etc. These rebellions can then become mainstream. Consumer as an activist Consciously and actively promote the interest of consumer groups in relation to producers and to society as whole. Consumer as a citizens This is a political concept, someone linked into a community and a nation state by web rights that he or she can claim freedom of speech etc. The consumer arises from economic actively in a society and in particular that the market place in which producers sell their goods and services without references to a wider social grouping than their household. The history of the consumer movement B S Patil

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Consumerism is not new, its referred to in the bible, the romans caveat emplor buyer beware, which became the dominant view in Western society. Cards have traditionally been stacked against the consumer. Advocates of consumer interest are seen as radical, who wanted to upset the state and go against the vested interest that it benefitted. The Co-operative movement Set up in Northern England in response by industrial workers to the effects of a local capitalist merchant. After the individual revaluation the work place went through dramatic changes. In the UK small workplace run by a craftsman and his family, this was replaced by factories which were owned by entrepreneurs, which contained hundreds of people crammed into factories with machines dark satanic mills described by Blake. Evidence that new technology of work was of secondary importance to a change in the psychological relationship between employers and employees, e.g. not that it helped the workers, life, it make the process more efficient and people got cheaper and more goods. The factory enabled employers to control the working lives of employees as much as possible (Bentham, Panpotican). Bureaucracy via impersonal forms of regulation, clocking on, informal monitoring of each others work etc. Children worked in those factories under terrible conditions, in these Dickensian times. The co-operative movement was attempt by workers to take back control of their lives, basing this on a new understanding if their position in the economy. Not only did their labour produce the goods that went out of the factories into the market, but they themselves were also consumers. So by co-operating, the consumer could precedence over the people who owned the means of production and operational them solely on the basis of self interest. The movement operated a single shop co-op in Rochdale. Looking to find a medium way, it obviously found it have to compete against profit seekers. American consumerism Prior to WWII, there were some organisation that looked after consumer interest. Upton Sinclair looking at work in Chicago stockyards, his work The Jungle was intended to attack the profit orientated capitalist system and bettering the lot of American workers. The American audience didnt seem too impressed with his work, regarding workers, they were more concerned with food safety laws.

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Capitalist and the system are highly regarded in the US but championing value for money etc were. Seiltasm is a consumer movement group in Japan. Fordism the new Fordist deal Ford marked the culmination of trends towards mass production in 1913. The system based on the reverse of an abattoir. To get people to work, he paid them twice as much as competitors. In return he demanded devotion to the job and a personal relationship with the firm. High wages encouraged commitment and it encouraged the consumption of goods, if you cut wages, you cut customers work hard, shut up, enjoy a good standard of living.

After World War 2 Kennedy , 1962 the consumer Bill or rights Right to safety protection against products hazardous to health and life Right to be informed production against misleading, fraudulent, deceitful or misleading information, in advertising or elsewhere Right to choose being the assurance of reasonable access, where possible to a variety of products of competitive prices, or the government regulation to assure satisfactory quality and service at fair prices. Right to be heard the right of redress. Ways of protecting consumers: Prevention, restoration and punishment Other consumers rights Each of Kennedy rights is vital to the consumer now as when it was originally incepted. Most expect would add the right to a clean environment and the right to privacy consumers should have the before they have a right to: Safety Be informed Choose Be heard

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A clean environment Privacy Summary Nine consumer images may be considered important as a contribution towards understanding consumer behaviour. Advocacy on behalf of the consumer or consumerism has a long history going back to the 19th century. It is essentially attempted to redress the enormous imbalance of power between producers and consumers, allowing customers to take back some control of their lives. But, even producers as contemptuous of the consumer as Henry Ford recognised that some financial power for consumers, in the form of high wages, was in the best interest of producers. In the Fordist vision mass consumption lead to mass production, which in turn lead to more mass production. This dynamic only worked if people had the money to buy the products they were making themselves. This lead to consumer/worker rights, the reality of the rights is another matter. The Future Consumer The Producer Customer Responsiveness A trend that began in the 70s and that will continue into the future. Began in Japan with MBWA Management by walking around and Kaizen continuous improvement. Lean-Production - Trying to marry Mass production with Individual customizing. Business Ethics 1. Codes of Ethics 2. Changes in the board of directors inclusion of external appointees. 3. Social Marketing being socially responsible as well as making a profit. Employees will only follow these ethics if senior management does and sets the example. The Market Place Political changes changes o government can have effects on the enforcement of regulation and on the amount of regulation. Reagan and Thatcher were very much for self-regulation. Regulatory agencies would include: Federal Trade Commission Food and Drug Administration FCC SEC EU and transnational laws protecting consumer and ensuring good working conditions, NAFTA also, protecting societal

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benefits, e.g. Canada allows only limited of media to be owned by US firms. Shopping Trends and Buyer Behavior Identification of new needs that are really wants rather than necessities. For most people choice means brand choice. Own Brand or private label growth. The Consumer Direct Action against the Producer 1. Boycotts 2. Organized Complaints 3. Legal Action Alternative Lifestyles 1. Green consumerism There are limits. People will buy unleaded gas but not give up their car. 2. Ethical investment 3. Exchange economy Informal Economy. Black economy. Grey economy unpaid LETS (local exchange trading system)

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