LHM Chapter 05 7e

Consumer Decision Making
Chapter 5
Prepared by
Deborah Baker
Texas Christian University
Chapter 5 Marketing 7e, Lamb Hair 1

McDaniel
Learning Objectives
1. Explain why marketing managers should

understand consumer behavior.
2. Analyze the components of the consumer

decision-making process.
3. Explain the consumer’s postpurchase

evaluation process.

McDaniel
Learning Objectives (continued)
4. Identify the types of consumer buying

decisions and discuss the significance of
consumer involvement.
5. Identify and understand the cultural factors

that affect consumer buying decisions.

McDaniel
Learning Objectives (continued)
6. Identify and understand the social factors

that affect consumer buying decisions.
7. Identify and understand the individual

factors that affect consumer buying
decisions.
8. Identify and understand the psychological

factors that affect consumer buying
decisions.
McDaniel
1 Learning Objective
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Explain why
marketing managers
should understand
consumer behavior.

McDaniel
1 Consumer Behavior
Processes a consumer uses to

make purchase decisions, as
well as to use and dispose of
purchased goods or services;
also includes factors that
influence purchase decisions
and
the product use.
McDaniel
Analyze the
components of the
consumer decision-
making process.

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2 Consumer Decision-Making Process
A five-step process used

by consumers when buying
goods or services.

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Consumer
2
Decision-Making Process
Need
Need Recognition
Recognition
Information
Information Search
Search
Cultural,
Cultural, Social,
Social,
Individual
Individual and
and
Psychological Evaluation
Evaluation
Psychological of
Factors
Factors of Alternatives
Alternatives
affect
affect
all
all steps
steps Purchase
Purchase
Postpurchase
Postpurchase
Behavior
Behavior
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2 Need Recognition
Result of an imbalance
between actual and
desired states.

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2 Need Recognition
Marketing helps
consumers
recognize an
Internal Stimuli
imbalance between
and
present status and External Stimuli
preferred state
Preferred
State
Present
Status
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2 Stimulus
Any unit of input affecting one or more of the five senses:

sight
smell
taste
touch
hearing

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2 Want
Recognition of an
unfulfilled need and
a product
(or attribute or feature)
that will satisfy it.

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2 Recognition of Unfulfilled Wants
 When a current product isn’t

performing properly
 When the consumer is running

out of a product
 When another product seems

superior to the one currently used

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2 Information Searches
Internal Process of recalling past

information stored
in the memory.
Process of seeking information

External in the
outside environment.

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2 Information Search
Internal Information Search
 Recall information in memory
External Information search
 Seek information in outside

environment
 Non-marketing controlled
 Marketing controlled
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2 External Information Searches
Need Less Need More

Information Information
Less Risk More Risk

More knowledge Less knowledge
More product Less product
experience experience
Low level of interest High level of interest

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2 Evoked Set
Group of brands,
resulting from an information search,
from which a buyer
can choose.

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2 Evaluation of Alternatives
Evoked Set
Analyze
Analyze product
product attributes
attributes
Use
Use cutoff
cutoff criteria
criteria
Rank
Rank attributes
attributes by
by
importance
importance
Purchase!
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2 Purchase
To buy
or not to buy...
Determines which attributes

are most important
in influencing a
consumer’s choice

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Explain the
consumer’s
postpurchase
evaluation process.

McDaniel
3 Cognitive Dissonance
Inner tension that a consumer experiences

after recognizing an inconsistency between
behavior and values
or opinions.

McDaniel
3 Postpurchase Behavior
?
Cognitive Dissonance
Can minimize through:

Effective Communication
Did I make a good decision? Follow-up
Guarantees
Did I buy the right product? Warranties
Did I get a good value?

McDaniel
Identify the types of

consumer buying
decisions and discuss
the significance
of consumer
involvement.

McDaniel
Types of Consumer
4
Buying Decisions
Routine
Routine Limited
Limited Extensive
Extensive
Response
Response Decision
Decision Decision
Decision
Behavior
Behavior Making
Making Making
Making
Less More
Involvement Involvement

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4 Five Factors influencing Decisions
1.Level of consumer involvement

2.Length of time to make decision
3. Cost of good or service
4. Degree of information search
5. Number of alternatives considered

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Continuum of
4
Consumer Buying Decisions

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4 Routine Response Behavior
 Little involvement in selection

process
 Frequently purchased low cost
goods
 May stick with one brand
 Buy first/evaluate later
 Quick decision

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4 Limited Decision Making
 Low levels of involvement
 Low to moderate cost goods
 Evaluation of a few alternative brands
 Short to moderate time to decide

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4 Extensive Decision Making
 High levels of involvement
 High cost goods
 Evaluation of many brands
 Long time to decide
 May experience cognitive dissonance

McDaniel
4 Level of Involvement
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Previous
Previous
Experience
Experience
Interest
Interest
Factors
Factors Perceived
Perceived Risk
Risk of
of
Determining
Determining Negative
Negative
Level
Level of
of Consequences
Consequences
Involvement
Involvement
Situation
Situation
Social
Social Visibility
Visibility
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Marketing Implications
4
of Involvement
High-involvement Low-involvement
purchases require: purchases require:
Extensive and In-store promotion,

informative promotion eye-catching package
to design, and good
target market displays

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Factors Influencing
4
Buying Decisions
Cultural Social
Factors Factors CONSUMER BUY /
DECISION-
MAKING DON’T BUY
Psycho- PROCESS
Individual logical
Factors Factors

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Identify and
understand the
cultural factors that
affect consumer
buying decisions.

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5 Culture
Set of values norms, attitudes,

and other meaningful symbols
that shape human behavior
and the artifacts, or products,
of that behavior as they are
transmitted from one
generation to the next.

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Cultural Influences on
5
Buying Decisions
Values
Values
Language
Language
Myths
Myths
Customs
Customs
Components Rituals
Components of
of Rituals
American
American Laws
Laws
Culture
Culture
Material
Material Artifacts
Artifacts
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5 Culture is...
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Pervasive
Pervasive
Functional
Functional
Learned
Learned
Dynamic
Dynamic
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5 Value
Enduring belief that a specific

mode of conduct
is personally or socially preferable
to another
mode of conduct.

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5 Core American Values
Success
Success
Materialism
Materialism
Freedom
Freedom
Progress
Progress
Core
Core
American
American Youth
Youth
Values
Values
Capitalism
Capitalism
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5 Global Language Blunders
 Chevrolet’s “Nova” translated to “No Go”
 Coors “Turn it Loose” became

“Suffer from Diarrhea”
 Toyota’s MR2 sounded like a

swearword in French
 Coca-Cola in Chinese means

“bite the wax tadpole”

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5 Subculture
A homogeneous group
of people who share elements
of the overall culture as well as
unique elements of
their own group.

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5 Social Class
A group of people in a society

who are considered nearly
equal in status or community
esteem, who regularly socialize
among themselves both
formally and informally, and
who share behavioral norms.

McDaniel
5 Social Class Measurements
Occupation
Occupation
Income
Income
Social
Social Class
Class Education
Education
Measurements
Measurements
Wealth
Wealth
Other
Other Variables
Variables

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The Impact of Social Class
5
on Marketing
 Indicates which medium to use for

advertising
 Helps determine the best distribution

for products

McDaniel
Identify and
understand the
social factors that
affect consumer
buying decisions.

McDaniel
6 Social Influences
Social
Social Influences
Influences on
on
Buying
Buying Decisions
Decisions
Reference
Reference Opinion
Opinion Family
Family
Groups
Groups Leaders
Leaders Members
Members

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6 Reference Group
A group in society that

influences an individual’s
purchasing behavior.

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6 Reference Groups
Primary
Direct
Secondary
Reference
Groups
Aspirational
Indirect
Non-aspirational
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6 Implications of Reference Groups
1. They serve as information sources

and influence perceptions
2. They affect an individual’s

aspiration levels
3. Their norms either constrain or

stimulate consumer behavior

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6 Opinion Leaders
An individual who
influences the opinion
of others.

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6 Opinion Leaders
Peer Groups
Group Referrals
Movie Stars
Sports Figures
Celebrities

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6 Family
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 Initiators
Purchase
Purchase Roles
Roles
in
in the
the Family
Family  Influencers
 Decision Makers
 Purchasers
Children
 Consumers
Influence
Purchase
Decisions
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Relationships among Purchasers
6
and Consumers in the Family

McDaniel
Identify and
understand the
individual factors
that affect consumer
buying decisions.

McDaniel
7 Individual Influences
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Individual
Individual
Influences
Influences
Age
Age Personality
Personality
Gender
Gender Family
Family Life
Life Self-Concept
Self-Concept
Cycle
Cycle Lifestyle
Lifestyle

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7 Family Life Cycle
An orderly series of stages through which consumers’ attitudes

and behavioral tendencies evolve through maturity,
experience, and changing income and status.

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7 Psychographics
The analytical technique used

to examine consumer lifestyles
and to categorize consumers.

McDaniel
Identify and
understand the
psychological factors
that affect consumer
buying decisions.

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8 Psychological Influences
Perception
Perception
Motivation
Motivation
Learning
Learning
Psychological
Psychological
Influences
Influences on
on
Buying
Buying Decisions
Decisions Beliefs
Beliefs &
& Attitudes
Attitudes

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8 Perception
Process by which people select,

organize, and interpret stimuli into
a meaningful and
coherent picture.

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8 Perception
Selective
Selective Selective
Selective
Exposure
Exposure Distortion
Distortion
Selective
Selective
Retention
Retention

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8 Perception
Selective
Selective Consumer
Consumer notices
notices certain
certain stimuli
stimuli
Exposure
Exposure and
and ignores
ignores others
others
Consumer
Consumer changes
changes or
or distorts
distorts
Selective
Selective information
information that
that conflicts
conflicts
Distortion
Distortion with
with feelings
feelings or
or beliefs
beliefs
Consumer
Consumer remembers
remembers only
only
Selective
Selective that
that information
information that
that
Retention
Retention supports
supports personal
personal beliefs
beliefs

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8 A Consumer’s Selective Exposure
Exposure
Exposure to
to over
over 250
250
advertisement
advertisement messages
messages per
per day
day
Notices
Notices only
only
11
11 to
to 20
20 ads
ads

McDaniel
Marketing Implications
8
of Perception
 Important attributes
 Higher price
 Brand names
 Quality and reliability
 Threshold level of perception
 Product or repositioning changes

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8 Maslow’s Hierarchy of Needs
A method of classifying human

needs and motivations into five
categories in ascending order
of importance.

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8 Motivation
Self-
Maslow’s
Maslow’s
Hierarchy Actualization
Hierarchy of
of
Needs
Needs Esteem
Social
Safety
Physiological
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8 Learning
A process that creates

changes in behavior,
immediate or expected,
through experience
and practice.

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8 Types of Learning
Types
Types of
of Description
Description
Learning
Learning
Experiential
Experiential An
An experience
experience changes
changes behavior
behavior
Not
Not learned
learned through
through direct
direct
Conceptual
Conceptual experience
experience

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8 Stimulus Generalization
A form of learning that occurs

when one response is
extended to a second stimulus
similar to the first.

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8 Beliefs and Attitudes
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An organized pattern of
Belief knowledge that an individual
holds as true about his
or her world.
A learned tendency to respond

Attitude consistently
toward a given object.

McDaniel

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Consumer Decision Making

Chapter 5 Marketing 7e, Lamb Hair 1

1. Explain why marketing managers should

2. Analyze the components of the consumer

3. Explain the consumer’s postpurchase

Chapter 5 Marketing 7e, Lamb Hair 2

4. Identify the types of consumer buying

5. Identify and understand the cultural factors

Chapter 5 Marketing 7e, Lamb Hair 3

6. Identify and understand the social factors

7. Identify and understand the individual

8. Identify and understand the psychological

Chapter 5 Marketing 7e, Lamb Hair 5

Processes a consumer uses to

Chapter 5 Marketing 7e, Lamb Hair 7

A five-step process used

Chapter 5 Marketing 7e, Lamb Hair 8

Chapter 5 Marketing 7e, Lamb Hair 10

Any unit of input affecting one or more of the five senses:

Chapter 5 Marketing 7e, Lamb Hair 12

Chapter 5 Marketing 7e, Lamb Hair 13

 When a current product isn’t

 When the consumer is running

 When another product seems

Chapter 5 Marketing 7e, Lamb Hair 14

Internal Process of recalling past

Process of seeking information

Chapter 5 Marketing 7e, Lamb Hair 15

Internal Information Search

 Recall information in memory

External Information search

 Seek information in outside

Need Less Need More

Less Risk More Risk

Chapter 5 Marketing 7e, Lamb Hair 17

Chapter 5 Marketing 7e, Lamb Hair 18

Determines which attributes

Chapter 5 Marketing 7e, Lamb Hair 20

Chapter 5 Marketing 7e, Lamb Hair 21

Inner tension that a consumer experiences

Chapter 5 Marketing 7e, Lamb Hair 22

Can minimize through:

Did I get a good value?

Chapter 5 Marketing 7e, Lamb Hair 23

Identify the types of

Chapter 5 Marketing 7e, Lamb Hair 24

Chapter 5 Marketing 7e, Lamb Hair 25

1.Level of consumer involvement

Chapter 5 Marketing 7e, Lamb Hair 26

Chapter 5 Marketing 7e, Lamb Hair 27

 Little involvement in selection

Chapter 5 Marketing 7e, Lamb Hair 28

 Low levels of involvement

 Low to moderate cost goods

 Evaluation of a few alternative brands

 Short to moderate time to decide

Chapter 5 Marketing 7e, Lamb Hair 29

 High levels of involvement

 High cost goods

 Evaluation of many brands

 Long time to decide

 May experience cognitive dissonance

Chapter 5 Marketing 7e, Lamb Hair 30