Co nsume r b ehavi or

Lecture notes are available at:

http://Arash-
management.blogspot.com

Arash 1
Consumer behavior (CB)

Arash Najmaei

Arash.unity@gmail
Arash.unity@yahoo.com
H/P : 0172116875

Arash 2
 Group
communication
social class
stratification
culture

Consumer behavior
Roger D. Blackwell
Paul W. Miniard
James F. Engel

Arash 3
 Outline of this chapter….

Group influence and Stratification and

communication Culture

Verbal and non verbal Social Factor

communications – Culture &
subculture
Marketer-dominated – Norms
stimuli – Values
– Religious groups
– Groups
• Reference
groups
 Group , communication
• Belonging to groups, trying to “fit in,” and striving to
please others, affects directly every stage in the
decision process.
• Reference group: any person or group of people
who significantly influences an individual’s behavior

• May be individuals (celebrities, athletes, or political

leaders) or groups of individuals with similarities
(musical groups or sports teams)
 High Degree
Personal and Group Influence on of Influence
Individuals

Personal Types of Lifestyles

Influences: Influence Behaviors
•Groups Normative Transmission Purchases
Value Expressive Consumption
•Individuals
Informational

Low Degree
of Influence
Types of Reference Groups
Primary Groups: a social
aggregation that is sufficiently
intimate to permit and facilitate
unrestricted direct interaction
(e.g., family)
Types of Reference Groups
Secondary Groups: also have
direct interaction, but it is more
sporadic, less comprehensive,
and less influential in shaping
thought and behavior (e.g.,
professional associations or
community organizations)
Types of Reference Groups
Formal Groups: characterized by a
defined structure (often written)
and a known list of members and
requirements for membership
Informal Groups: have less
structure than formal groups and
are likely to be based on
friendship or interests
Types of Reference Groups
Membership: when individuals are
recognized as members of a group,
they have achieved formal
acceptance status in the group
Aspirational Groups: exhibit a
desire to adopt the norms, values,
and behaviors of others with whom
the individuals aspire to associate
Types of Reference Groups
Dissociative Groups: groups from
which an individual tries to avoid
association
Virtual Groups: groups that are
based on virtual communities
rather than geographic ones
Types of Group Influence
Normative: when individuals alter
their behaviors or beliefs to meet the
expectations of a particular group
Value-expressive: when a need for
psychological association with a
group causes acceptance of its
norms, values, attitudes, or behaviors
Informational: when people have
difficulty assessing product or brand
characteristics by their own
observations or contact
How Reference Groups Influence
Individuals
Socialization: permits an individual
to know what behavior is likely to
result in stability both for the
individual and the group
Company manual may explain the
dress code in the workplace
Informal groups may tell them
what styles are most comfortable
and easiest to maintain
How Reference Groups Influence
Individuals
Self-concept: people protect and
modify their self-concept by their
interactions with group members
People can maintain self-concept
by conforming to learned roles
Testimonial advertising is effective
when the self projected in the ad is
consistent with the idealized self
of the target consumer
How Reference Groups Influence
Individuals
Social comparison: individuals
often evaluate themselves by
comparing themselves to others
Consumers often use reference
groups as benchmarks to measure
their own behaviors, opinions,
abilities, and possessions
Advertising or television can be
sources of social comparison
How Reference Groups Influence
Individuals
Conformity: a change in beliefs or
actions based on real or perceived
group pressures
Compliance: when an individual
conforms to the wishes of the group
without accepting all its beliefs or
behaviors
Acceptance: when an individual
actually changes his or her beliefs
and values to those of the group
How Reference Groups Influence
Individuals
Factors affecting how likely people
are to conform to group norms:
Desire for social acceptance
Degree of experience in situation or
with decision
Conspicuousness
Complex product or luxury item
Transmission of Influence
Through Dyadic Exchanges
Exchange between two individuals
that influence these individual’s
behaviors or beliefs
Dyadic exchange requires the
exchange of resources (opinions
and comments)
Dyadic Exchanges

Word-of-mouth Communication
Service Encounters
Opinion Leadership
Opinion Leadership
Opinion leadership: the sender of
information is often considered an
opinion leader—a person who
influences the decisions of others
Opinion leaders might be experts in
one area but not in others
The greater the perceived knowledge
of a category, the more likely that
person’s opinions are to influence
others’ decisions
 Service Encounters
Customer intimacy: detailed
understanding and focus on
customers’ needs lifestyles and
behaviors in an effort to create a
deep cultural connections with the
customers
Reverse customer intimacy: how well
marketers facilitate customers
knowing the marketer
How Personal Influences Are
Transmitted
Two-step Flow
Information and
Information Influence

Mass Opinion Opinion

Media Leader Seekers
How Personal Influences Are
Transmitted
Multistep Flow

Mass Opinion Opinion

Media Leader Seekers

Gatekeepers
 WOM and Opinion Leaders in
Advertising and Marketing
Strategy
WOM and personal communication
can have a more decisive role in
influencing behavior than
advertising and other marketer-
dominated sources
Viewed as a more trustworthy and
credible source of information than
salespeople or paid advertising
 WOM and Opinion Leaders in
Advertising and Marketing
Strategy
Advertising can provide
information to consumers about
products they might seek from
other sources and which may be
discussed in WOM
However, consumers don’t always
trust that the advertiser has their
best interests in mind
WOM and Opinion Leaders in
Advertising and Marketing
Strategy
Advertising influences the
effectiveness of WOM and vice
versa
Advertising can provide
information about products
consumers might not seek from
other sources
Advertising can create WOM among
consumers and peer groups
Primary Reliance on
Word-Of-Mouth
For some occasions, companies
rely on WOM as a substitute for
advertising

Direct Response Advertising

 Stimulating Word-Of-Mouth

Firms may stimulate WOM by giving

away or loaning products to opinion
leaders to display and use
Organizations may induce opinion
leaders to influence consumers
Creating Opinion Leaders
 Curbing Negative WOM
When something goes terribly
wrong, denying the problem is not
the answer
The best strategy is immediate
acknowledgement by a credible
company spokesperson as negative
WOM rarely goes away by itself
Make sure you have all your facts
straight and tell the truth
The Diffusion Process
Diffusion: the process by which an
innovation (new idea) is
communicated through certain
channels over time among the
members of a social system
Includes:
Diffusion of information and
communication
Consumer decision process
Diffusion or demise of innovation
 The Diffusion Process
Diffusion
Accept of
C Innovation
o
n
Organi- s
Influencer (X number of people)
zation u
m
e
r
Demise
Reject of
Innovation
Diffusion of Information
and Communication

Consumer decision process

 Factors Affecting Diffusion
Communication (how consumers
learn about new products and
communicate findings)
Time (how long it takes for a
person to move from product
awareness to product purchase or
rejection)
Social system (groups or segments
to which individuals belong affect
adoption or rejection)
Rogers Model of Innovation Decision Process

Knowledge: begins when the

consumer receives physical or
social stimuli that gives exposure
and attention to the new product
and how it works
How a person receives and
interprets the knowledge is
affected by their personal
characteristics
Rogers Model of Innovation Decision Process

Persuasion: refers to the

formation of favorable or
unfavorable attitudes towards
the innovation
Persuasiveness is related to the
perceived risks and
consequences of adopting and
using the new product
Rogers Model of Innovation Decision Process

Decision: involves a choice

between adopting and rejecting
the innovation
Adoptors are people who have
made a decision to use a new
product whereas other are
nonadoptors
Rejection may be active or
passive
Rogers Model of Innovation Decision Process

Implementation: occurs when the

consumer puts an innovation to
use
The process has been a mental
exercise until this point where it
requires a behavioral change
The strength of the marketing
plan may be the critical
determinant in a sale resulting
Rogers Model of Innovation Decision Process

Confirmation: during this stage,

consumer seek reinforcement for
their innovation decision
Consumer may reverse previous
decision due to conflicting
messages resulting in dissonance
Discontinuance is a serious
concern to marketers who strive
for continued acceptance
Rogers Model of Innovation Decision Process

Communication Channels

Implemen-
Knowledge Persuasion Decision Confirmation
tation
Adopter Classes

A B C D E

A= Innovators (2.5%)
B= Early Adopters (13.5%)
C= Early Majority (34%)
D= Late Majority (34%)
E= Laggards (16%)
Consumers Likely to Buy New
Products
Innovators: the first consumer group to
adopt products
Early adopters: opinion leaders and role
models for others, with good social
skills and respect within larger social
systems
Early majority: consumers who
deliberate extensively before buying
new products, yet adopt them just
before the average time it takes the
target population as a whole
Consumers Likely to Buy New
Products
Late majority: tends to be cautious
when evaluating innovations, taking
more time than average to adopt them,
and often at the pressure of peers
Laggards: the last groups that tend to
be anchored in the past, are suspicious
of the new, and exhibit the lowest level
of innovativeness among adopters
Consumers Likely to Buy New
Products
Innovativeness: the degree to
which an individual adopts an
innovation earlier than other
members of a social system
Cognitive innovators: have a strong
preference for new mental experiences
Sensory innovators: have a strong
preference for new sensory experiences
Advertising and other communications
can be targeted accordingly
social class
stratification
culture
 What Is Culture?
A set of values, ideas, artifacts, and
other meaningful symbols that help
individuals communicate, interpret, and
evaluate as members of society
Blueprint of human activity,
determining coordinates of social
action and productive activity
A set of socially acquired behavior
patterns transmitted symbolically
through language and other means to
the members of a particular society
 Values and Norms
Norms: rules of behavior held by a
majority or at least a consensus of a
group about how individuals should
behave
Cultural (social) values: values shared
broadly across groups of people
Personal values: terminal (goals) or
instrumental (behaviors) beliefs of
individuals
Values and Norms
Values and norms represent the beliefs of
various groups within a society
Macroculture: values and symbols that
apply to an entire society or most of its
citizens
Microculture: values and symbols of a
restrictive group or segment of
consumers, defined according to
variables such as age, religion, ethnicity,
or social class
Values and Norms
Socialization: the process by which
people develop their values,
motivations, and habitual activity
The Values Transfusion Model shows
how the values of a society are reflected
in families, religious institutions, and
schools, all of which expose and
transmit values to individuals
Characteristics Influenced by Culture
Sense of self and space
Communication and language
Dress and appearance
Food and feeding habits Time
and time consciousness
Relationships
Values and norms
Beliefs and attitudes
Mental processes and learning
Work habits and practices

Used to define and differentiate cultures

 Values and Norms
People adopt values that influence how
they live, how they define right and
wrong, how they shop, and what is
important to them
The values adopted by individuals today
shape the values of society in the future
 The Values Transfusion Model
Values of Society

Religious Educational Early

Family Institutions
Institutions Lifetime
Experiences

Individual
Peers Internalized Media
Values

Society of
Future
Changing Values
Society’s values change continuously
even though core values are relatively
permanent

Changes in values may alter the

response to advertising, service
offerings, and retailing formats
 Changing Values

Will people become more like their

parents as they get older, or will
they carry with them the values of
their generation?

Depends on elements in the

Cultural Transfusive Triad and
early lifetime experiences
Changing Values
Life-cycle explanation: values change
according to life-cycle (as individuals
grow older, their values change)
Theory of behavioral assimilation:
Younger people grow into the values of
their parents as they get older
Generational change: gradual
replacement of existing values by those
of young people who form the leading
generation in value terms
 The Values Transfusion Model

Cultural Transfusive Triad

Religious Educational Early

Family Institutions
Institutions Lifetime
Experiences
 How Culture Affects Consumer
Behavior:

Pre-purchase and Purchase

Activities

Consumption and
Divestment Activities
Influence of Culture on Pre-
purchase and Purchase Activities
Culture affects what consumers think
they need and what they perceive as
frivolous
Culture affects how consumers are
likely to search for information
Culture affects the importance placed
on certain attributes of alternatives
Culture affects the amount of price
negotiation during the purchase
process
 Influence of Culture on Consumption
and Divestment Activities
Culture affects how consumers use or
consume products
Consumers’ expectations about form
and function vary between cultures
Culture influences how individuals
dispose of products—reselling
products after use, giving them to
others for use, or recycling them and
their packaging when possible
Changing Family Influences
Less time for in-home or parent-
child influence
Increasing divorce rates
Isolated nuclear family (geographic
separation of generations)
Changing Religious Influences
Traditional churches and religions
have seen a decline in loyalty
Increase in non-Christian religions
A shift from traditional religion to
spirituality
Women are more religious
Religion and spirituality are big
business and influence big
business
Changing Educational Influences
Dramatic increase in formal
education
Teaching has evolved from
memorization to questioning
Digital learning has increased in
popularity
Acculturation: measures the
degree to which a consumer has
learned the ways of a different
culture compared to how they
were raised
Just as individuals adapt to
cultural changes, so do
companies
Advertisements Appealing to

the Latin-American Market

Advertisements Appealing to
the Latin-American Market
Social Class Microcultures
Social class: relatively permanent
and homogeneous divisions in a
society into which individuals or
families sharing similar values,
lifestyles, interests, wealth,
status, education, economic
positions, and behavior can be
categorized
Social Class Microcultures
Concrete variables that define
social classes include occupation,
education, friendships, ways of
speaking, and possessions
Perceived variables that define
social class include power, and
prestige
Social class, in part, determines
the mix of goods consumers will
buy
Social Class Microcultures
Status groups: reflect community’s
expectations for style of life among
each class as well as the positive
or negative social estimation of
honor given to each class
Social Class Microcultures
What determines social class?
Occupation Income
Economic Wealth

Variables
Personal Prestige
Interaction Association Socialization
Variables

Political Power Class

consciousness Mobility
Variables
Social Class Microcultures
Consumer analysts often focus on
six variables which determine
social class
Occupation
Personal performance
Interactions
Possessions
Value orientations
Class consciousness
Social Class Microcultures
Occupation: best single indicator
of social class
Personal performance: a person’s
success relative to that of others
(often in the same occupation)
Interactions: the people with whom
one associates and socializes
Possessions: symbols of class
membership
Social Class Microcultures
Value orientations: values are
indicators of our social class
In some countries, values are more
important than possessions and
social class is determined more by
achievements than by
possessions
Class consciousness: the degree
to which people in a social class
are aware of themselves as a
distinctive group
Social Class Microcultures
Social stratification: perceived
hierarchies in which consumers rate
others as higher or lower in social
status
Achieved status: earn a higher status
due to work or study
Ascribed status: lucky to be born
wealthy or beautiful
Status inconsistency: when a person
rates high on one variable and low in
another (some athletes or musicians)
Market Segmentation
Identification of social class usage of the
product
Comparison of social class variables for
segmentation with other variables
Description of social class
characteristics identified in target
markets
Development of marketing program to
maximize effectiveness of marketing mix
based on consistency with social-class
attributes
Positioning Based on Social Class
Understanding social class helps
marketers create perceptions
about products or organizations in
consumers’ minds
Appeal to those who are in a social
class and those who aspire to be
there
Positioning Based on Social Class
Brands such as Coach and Godiva
are positioned to middle class
consumers with simple, sleek ads
Wanting it all is a hallmark of the
middle class and buying the best
on at least a few occasions sets
them apart and bolsters their self-
image