CONSUMER BEHAVIOR:

A FRAMEWORK
Chapter 1: An Introduction to
Consumer Behavior
Published by Prentice, Inc.

Concepts to Learn

Definition of CB
Consumer primacy
Environmental
analysis
Positioning/differentiat
ion
Segmentation

Theory and CB
Research
perspectives on
consumer behavior
Exchange
processes
Organizing model
of consumer
behavior

Consumer Behavior . . .
. . . is defined as the
study of the buying
units and the
exchange processes
involved in
acquiring,
consuming, and
disposing of goods,
services,
experiences, and
ideas.

Why Study Consumer

Behavior?

Foundation of Marketing
Management
Public Policy and Consumer
Behavior
Altruistic Marketing
Personal Value

Three Research
Perspectives on
Consumer Behavior

The Decision-Making Perspective

The Experiential Perspective

The Behavioral Influence

Perspective

The Decision-Making
Perspective . . .
. . . proposes that Generic Decision
buying results from Model
Problem Recognition
consumers
Search
perceiving that
Alternative
they have a
problem and then
Evaluation
they move through Choice
a series of rational
Postacquistion
steps to solve the
Evaluation
problem

The Experiential
Perspective.
. . . proposes that in
some instances
buying results from
the consumers need
for fun, to create
fantasies, obtain
emotions, and
feelings.
Frequently uses
interpretative
research methods.

The Behavioral
Influence
Perspective . . .
. . . assumes that strong
environmental forces propel
consumers to make purchases
without necessarily first developing
strong feelings or beliefs about the
product.

Exchange Processes and

Consumer Behavior

Exchange is the
process that
involves the
transfer of
something tangible
or intangible, actual
or symbolic,
between two or
more social actors.

Prerequisites for
Exchange:

Two or more parties must be present

Each party has something of value to the
other
Each party is capable of communication and
delivery
Each party must be free to accept or reject
the other's offer
Each party must believe that it is
appropriate or desirable to deal with the
other

Elements of Exchange

Goods

Money

Information

Six Types of Resources Are

Exchanged:
Service
Status

Feelings

Dimensions of Exchange
Relations

Four types of consumer exchange

relations have been identified:

Restricted versus Complex Exchanges

Internal versus External Exchanges
Formal versus Informal Exchanges
Relational versus Discrete

Current hot topic in marketing

Characteristics

Relational
exchange
long term

reciprocal obligations
non-economic rewards: market embeddedness-social ties between buyer and seller increase
perceived value of exchange.
extensive formal and informal communications
high interdependence
planning

Relational exchange practiced between

members of marketing channel.

Market Embeddedness

The social ties between buyer and

seller increase the perceived value
of the exchange.
Examples, house parties of:

Tupperware
Mary Kay Cosmetics

Ethical Issues in
Consumer Exchange
Relations

Ethics is the study

of the normative
judgments
concerned with
what is morally
right and wrong,
good and bad.
Free riding:
example of an
unethical action.

Ethical judgments

deal with serious human injuries and benefits

may, or may not, be laid down by authority

override self interest
are based on impartial considerations
Ethical dilemma: a decision that involves the
trade-off between lowering ones personal values in
exchange for increased organizational or personal
profits.

Ethical exchange

both parties know full nature of agreement

nothing intentionally misrepresented or omitted
no undue influence takes place via power.

Ethical rules of thumb

Golden rule: act in a way that you

would expect others to act toward you.
professional ethic: take actions that
would be viewed as proper by an
unbiased panel of colleagues.
TV test: Would I feel comfortable
explaining my actions on national
television?
Kants categorical imperative: forego
acts, that if used as a universal
principle of behavior, would result in
negative societal outcomes.

An Organizing Model of
Consumer Behavior

The model has five primary

components:

The
The
The
The
The

Buying Unit
Exchange Process
Marketers Strategy
Individual Influencers
Environment

Buying unit

consumers, firms, government, non-profits, etc.

Individual influencers

information processing

behavioral learning
motivation and personality

beliefs, attitudes and behaviors

communications
decision making

Marketer, who develops strategy

marketing mix
segmentation and positioning
employs marketing research to understand
consumers

Environmental Analysis:

the marketer assesses the impact of each of

the below facets of the environment on the
firm.
situations
groups and families
culture
subculture
cross cultural issues

regulatory environment

Managerial Applications
Analysis (PERMS)

Five factors to consider when using

consumer behavior principles to
develop managerial strategy are:

positioning and differentiation

environmental analysis
marketing research
marketing mix
segmentation