Whatyouwilllearn

Session 1:
Consumer behaviour and Marketing strategy

Session 2:
Cross-Cultural Variations, and Group Influence
on Consumer Behavior
Session 3:
Customer Perception

Session 8:
Article presentation
Session 9:
The Process and Problem Recognition
Session 10:
Information search
Session 11:
Alternative Evaluation, and Selection

Session 4:
Consumer learning and memory

Session 12:
Post-purchase processes, customer satisfaction,
and customer commitment

Session 5:
Motivation, Personality, Emotion

Session 13:
Organizations as consumers

Session 6:
Attitudes and Influencing Attitudes

Session 14:
Group Project presentation

Session 7:
Self-concept and lifestyle

Session 15: Final exam

CHAPTER

02

CrossCultural
Variations in
Consumer
Behavior
McGraw-Hill/Irwin

Copyright 2013 by The McGraw-Hill Companies, Inc. All rights reserved.

2-3

Learning Objectives
Define the concept of culture
Describe core values that vary across culture and
influence behaviors
Understand cross-cultural variations in nonverbal
communications
Summarize key aspects of the global youth culture
Understand the role of global demographics
List the key dimensions in deciding to enter a foreign
market
2-4

ConsumerBehaviorInTheNews
Changing world
An Ever Changing World
https://www.youtube.com/watch?v=yuKu6PZXCIY
How consumer behaviours have been changed to
adapt to the changing world?
What is the implication for business firms?

Hint: compare your grand parents, your parents life

and your life.
2-5

Marketing Across Cultural Boundaries is a

Difficult and Challenging Task

2-6

Video Application
The following Video Clip demonstrates
how Oreo adapts globally to be the
number one cookie in the world.
https://www.youtube.com/watch?
v=U48nmKPJclA

2-7

Globalization
Globalization changing from
One-way influence from U.S. to other countries to
Mutual influence: Frozen Kangnam style

Four major world citizens

Global citizens: Positive toward international brands, view them as a signal of
higher quality, most concerned about corporate responsibility to the local country
Global dreamers: Positive toward international brands, and buy into their positive
symbolic aspects, less concerned about corporate responsibility to the local country
Antiglobals: Negative toward international brands, dont like brands that preach
American values, dont trust multinationals.
Global agnostics: Dont base decisions on global brand name, evaluate as they
would local brands, dont see global brands as special.
Who you are?
2-8

The Concept of Culture

Culture is the complex
whole that includes
knowledge, belief, art,
law, morals, customs,
and any other
capabilities and habits
acquired by humans as
members of society.
What is culture?
https://www.youtube.com/watch?v=m8pbmbfeoHs
- Culture differences in international patterns exist:
Asian Culture vs. American Culture:
https://www.youtube.com/watch?v=bg_q8YUuuzM

2-9

The Concept of Culture

Cultural values give
rise to norms and
associated sanctions,
sanctions
which in turn influence
consumption patterns.
patterns
Cultures are not static.
They typically evolve and
change slowly over time.
(Female smoking? Hair
dying? Lesbian/Gay?)

2-10

Variations in Cultural Values

The numerous values that differ across
cultures and affect consumption include:
Other-Oriented Values: reflect a societys view of the
appropriate relationships between individuals and groups
within that society;
Environment-Oriented Values: prescribe a societys
relationship to its economic and technical as well as its
physical environment
Self-Oriented Values: reflect the objectives and approaches
to life that the individual members of society find desirable .

2-11

Variations in Cultural Values

Other-Oriented Values: individual group
Individual/Collective
Youth/Age
Extended/Limited Family
Masculine/Feminine
Competitive/Cooperative
Diversity/Uniformity

2-12

Variations in Cultural Values

Environment-Oriented Values: society economic,
technical, and physical environment
Cleanliness
Performance/Status
Tradition/Change
Risk taking/Security
Problem solving/Fatalistic
Nature

2-13

Variations in Cultural Values

Self-Oriented Values
Active/Passive
Sensual gratification/Abstinence
Material/Nonmaterial
Hard work/Leisure
Postponed gratification/Immediate gratification
Religious/Secular

2-14

Applications in Consumer Behavior

Sensual Gratification/Abstinence
Ad for Calvin Klein
underwear:
OK in U.S. and
France.
Not appropriate in
cultures that place a
high value on
abstinence.

2-15

Cultural Variations in Nonverbal

Communications

2-16

Cultural Variations in Nonverbal

Communications

Time
The meaning of time varies
between cultures in two major
ways:

Time perspective

Time Interpretations

2-17

Cultural Variations in Nonverbal

Communications

Space

Overall use and meanings

assigned to space vary widely
among different cultures

2-18

Cultural Variations in Nonverbal

Communications

Symbols
Colors, animals, shapes,
numbers, and music have
varying meanings across
cultures.
Failure to recognize the
meaning assigned to a symbol
can cause serious problems!

2-19

Cultural Variations in Nonverbal

Communications

2-20

Cultural Variations in Nonverbal

Communications

Relationships
How quickly and easily do cultures
form relationships and make friends?
Americans tend to form relationships
and friends quickly and easily.
Chinese relationships are much more
complex and characterized by guanxi.

2-21

Cultural Variations in Nonverbal

Communications

Agreements
How does a culture ensure
business obligations are
honored? How are
disagreements resolved?
Some cultures rely on a legal
system; others rely on
relationships, friendships, etc.

2-22

Cultural Variations in Nonverbal

Communications

Things
The cultural meaning of things
leads to purchase patterns that one
would not otherwise predict.
The differing meanings that
cultures attach to things, including
products, make gift giving a
particularly difficult task.

2-23

Cultural Variations in Nonverbal

Communications

Etiquette
The generally accepted ways of behaving in
social situations.
Behaviors considered rude or
obnoxious/offensive in one culture may be
quite acceptable in another!
Normal voice tone, pitch, and speed of
speech differ between cultures and
languages, as do the use of gestures.

Japanese Etiquette

bad Japanese Etiquette

2-24

Global Cultures
A Global Youth Culture?
Mass media and the Internet have
had an impact of uniformity among
teens around the world.
They tend to watch many of the
same shows, movies and videos,
listen to the same music, and dress
alike.
Technology is important factor but
U.S. youth and brands no longer lead
the way: Lexus, Uniqlo,
2-25

Global Demographics
Demographics describe a population in terms of its size,
structure, and distribution.
Demographics are both a result and a
cause of cultural values.
For example, densely populated
societies, such as China, are likely to
have more of a collective orientation
than an individualistic one.
Disposable income is one aspect of
demographics--the rapid growth in
personal income in parts of China has led
to an overall market explosion!

2-26

Global Demographics
Marketers increasingly use Purchasing Power Parity (PPP)
rather than average or median income to evaluate markets.
PPP is based on the cost of a standard market basket of
products bought in each country.
The following shows four countries in terms of PPP:
Country

Per Capita
Income

% of Total income
(to top 10%)

Per Capita
PPP

Brazil

$4,791

45%

$8,596

China

$1,721

35%

$4,091

United Kingdom

$37,266

29%

$31,580

United States

$41,674

30%

$41,674

2-27

Cross-Cultural Marketing Strategy

Considerations in Approaching a Foreign Market
1. Homogeneous versus Heterogeneous with Respect to
Culture?
2. What Needs Can the Product Fill in this Culture?
3. Can Enough People Afford the Product?
4. What Values are Relevant to the Purchase and Use of the
Product?
5. What are the Distribution, Political and Legal Structures for
the Product?
6. In What Ways Can We Communicate About the Product?
7. What are the Ethical Implications of Marketing This Product
in This Country?
2-28

Applications in Consumer Behavior

This Chinese
Dunkin Donut store
is an example of
glocalization.
Notice the mix of
standard and
customized themes
(color and symbols).
Ted Hornbein

2-29

Discussion:Cultureandconsumer
behaviour
Stick with your chosen
product/brand; .
Discuss how culture values (Slide 12,
13, 14)/non-verbal
communications/demographics affect
the consumers behavior in the North
and the South of Vietnam (or between
Japan and Vietnam)? Then marketing
strategy of the company

CHAPTER

07

Group
Influences on
Consumer
Behavior

McGraw-Hill/Irwin

Copyright 2013 by The McGraw-Hill Companies, Inc. All rights reserved.

7-32

Learning Objectives
Explain reference groups and the criteria used to classify
them
Discuss consumption subcultures, including brand and
online communities and their importance for marketing
Summarize the types and degree of reference group
influence
Discuss within-group communications and the
importance of word-of-mouth communications to
marketers
Understand opinion leaders (both online and offline) and
their importance to markets
Discuss innovation diffusion and use an innovation
analysis to develop marketing strategy
7-33

ConsumerBehaviorInTheNews
What Matters to Early Tech Adopters?
Which of the following laptop aspects is most
important to early adopters of technology?

Price and warranty

Brand reputation
Technologically advanced
Innovative design

What are the marketing implications?

Source: Early Adopters Expect More From Technology, Advertising Age, March 15, 2010.

7-34

ConsumerBehaviorInTheNews
What Matters to Early Tech Adopters?
Which of the following laptop aspects are most
important to early adopters of technology?
If you said tech advanced and innovative
design you are right! Price is just not that
big a deal.
What are the marketing implications?
Think iPod/iPhone/iPad!! Clearly designed
with the early adopter in mind higher
priced, but great design and technology!

Source: Early Adopters Expect More From Technology, Advertising Age, March 15, 2010.

7-35

Reference Group Influence

A group is defined as two or more individuals who share
a set of norms, values, or beliefs and have certain
implicitly or explicitly defined relationships to one another
such that their behaviors are interdependent.
A reference group is a group whose presumed
perspectives or values are being used by an individual as
the basis for his/her current behavior.

7-36

Reference Group Influence

Four criteria that are particularly useful in
classifying groups:
groups
1. Membership
2. Strength of Social Tie
3. Type of Contact
4. Attraction

7-37

Types of Groups
Consumption Subcultures
Identifiable hierarchy
Set of shared beliefs and values
Unique jargon and rituals

Sneekerheads - The culture of shoe collectors

7-38

Reference Group Influence

Brand Communities
Brand communities can add value to the ownership of the
product and build intense loyalty.
When a consumer becomes part of a brand community,
remaining generally requires continuing to own and use
the brand.
This can create intense brand loyalty!

7-39

Types of Groups
Online Communities and Social Networks
Community interacts around a topic of interest on
the Internet
Online Social Network Sites
Facebook and MySpace
YouTube and Flickr
Twitter

7-40

Types of Groups
When Using Social Media in Marketing
Be transparent
Be part of the community
Take advantage of the unique capabilities
of each venue

7-41

Reference Group Influence on the

Consumption Process
Types of Reference Group Influence
Situational Determinants of Reference
Group Influence
Brand vs. Product Class Influence
Marketing Strategy and Reference Groups

7-42

Reference Group Influence on the

Consumption Process
Types of Reference Group Influence
Reference group influence can take three forms:
1. Informational Influence
2. Normative Influence (a.k.a. utilitarian influence)
3. Identification Influence (a.k.a. value expressive)

7-43

Reference Group Influence on the

Consumption Process
Consumption Situations and Reference Group Influence

7-44

Reference Group Influence on the

Consumption Process

7-45

Communications within Groups and Opinion

Leadership
WOM
Opinion Leaders
Market Mavens, Influentials, and e-fluentials
Marketing and Online Strategies

7-46

Communications within Groups and Opinion

Leadership
WOM Versus Advertising

(% who put people vs. advertising as best source)

7-47

Communications within Groups and Opinion

Leadership
Opinion Leaders

An opinion leader is the go to person for specific

types of information. This person filters, interprets, and
passes along information.
Opinion leaders possess enduring involvement for
specific product categories. This leads to greater
knowledge and expertise.
Opinion leadership is category specific an opinion
leader in one product category is often an opinion
seeker in others.
7-48

Communications within Groups and Opinion

Leadership
Mass Communication Information Flows

7-49

Communications within Groups and Opinion

Leadership
Situations in Which WOM and Opinion Leadership Occur

The exchange of advice and information between group

members can occur directly via WOM in the following
situations:
Likelihood of Seeking an Opinion Leader
1. Individual seeks
information from
another, or
2. Individual
volunteers
information

7-50

Communications within Groups and Opinion

Leadership
Crowdsourcing
Goes well beyond consumer-generated ads .
Can involve setting up a forum in which customers
help other customers.
Can include input into product and service design.

7-51

Communications within Groups and Opinion

Leadership
Mavens, Influentials, and e-fluentials
1. A market maven/expert is a generalized market
influencer who provides significant amounts of
information about various products, places to shop, and
so on.
2. Roper Starch identifies a group similar to market mavens
called influentials.
influentials Influentials are 10% of population but
use broad social networks to influence the other 90%!
3. Roper Starch identifies a group similar to Internet market
mavens called e-fluentials. They wield/exercise
significant online and offline influence.
7-52

Communications within Groups and Opinion

Leadership
Marketing Strategy, WOM, and Opinion Leadership

Strategies designed to generate WOM and encourage

opinion leadership include:
1. Advertising
2. Product Sampling
3. Retailing/Personal Selling
4. Creating Buzz
coca cola buzz marketing

7-53

Applications in Consumer Behavior

Marketing Strategy, WOM, and Opinion Leadership

Advertising can
stimulate and
simulate WOM and
opinion leadership.

This ad would likely stimulate WOM via interest and excitement

Christopher Kerrigan

7-54

Communications within Groups and Opinion

Leadership
Online Strategies to Leverage Buzz and WOM

Viral marketing is an online pass-it-along strategy,

utilizing electronic communication to trigger brand
messages (often via email) throughout a widespread
network of buyers.
Blogs are personalized journals where people and
organizations can keep a running dialogue.
Twitter is a micro-blogging tool that has evolved quickly
into one of the largest social media outlets.
7-55

Applications in Consumer Behavior

Angies List is an example of a consumer review site.

Courtesy Angies List Inc.

7-56

Diffusion Innovations
An innovation is an idea, practice, or product perceived to be
new by the relevant individual or group.
The manner by which a new
product spreads through a
market is basically a group
phenomenon.
New products can be placed
on a continuum from no
change to radical change,
depending on the markets
perception.

7-57

Diffusion Innovations
Categories of Innovation
Adoption Process
Diffusion Rate
Adopter Categories
Marketing Strategies and the Diffusion Process

7-58

Diffusion Innovations
Categories of Innovations
Continuous Innovation
Adoption of this type of innovation requires relatively minor
changes in behavior(s) that are unimportant to the consumer.

Dynamically Continuous Innovation

Adoption of this type of innovation requires a moderate
change in an important behavior or a major change in a
behavior of low or moderate importance to the individual.

Discontinuous Innovation
Adoption of this type of innovation requires major changes in
behavior of significant importance to the individual or group.
7-59

Diffusion Innovations
Adoption Process and Extended Decision Making

7-60

Diffusion Innovations
Diffusion Rates for Popular Consumer Electronics (Cumulative)

7-61

Diffusion Innovations
Factors Affecting the Spread of Innovations
Type of Group
Perceived Risk

Type of Decision

Trialability

Marketing Effort

Rate of Diffusion
Fulfillment of
Observability

Felt Need

Compatibility

Complexity
Relative Advantage

7-62

Diffusion Innovations
Adopter Categories

Innovators
Early Adopters
Early Majority
Late Majority
Laggards

7-63

Diffusion Innovations
Marketing Strategies and the Diffusion Process
Market
Segmenta
tion
Diffusion
enhance
ment
strategies

7-64