Consumer Behaviour

Consumer Behaviour
Debasis Pani
Asst. Professor
CMS-GIACR
A cloud does not know why it moves in just such a direction and at such a speed It feels an
impulsion. This is the place to go now. But the sky knows the reasons and the patterns behind
all clouds, and you will know, too, when you lift yourself high enough to see beyond horizons.
. Richard Bach
Objective of Studying Consumer Behaviour
The objective behind studying Consumer Behaviour as a student of marketing
management is to understand the consumer decision making process and try to influence it.
Who is a Consumer?
In common practice, we do not make any difference between a customer and consumer.
A Customer is one who is in the customary process of purchase or regularly purchases a
product or service from a particular organization or shop. A customer is always defined in terms of
a specific product or company.
In a simple sense Consumers refers to individuals or households that use goods and
services generated within the economy. But in marketing, consumer is anyone who typically
engages in the activities of evaluating, purchase, using or disposing of goods and services
Ultimate Consumer or End Consumer is one who purchases goods and services for the
purpose of individual or household consumption.
What is Behaviour?
Behaviour refers to the process of responding to stimuli (The cues or actions that
evoke/stimulate a reaction from the receiver), a human being shows his behaviour in the way he
feel, act and think (FAT) similarly the consumer also shows his behaviour in way he feel, think and
carry out action.
What is Consumer Behaviour?
One thing is very common that we all are consumer; everybody in this world is a consumer.
Every thing we buying are consuming Varity of goods and services. However we all have different
tastes, likes and dislikes and adopt different behaviour patterns while making purchases decisions.
Each consumer is unique and uniqueness is reflected in the consumption behaviour and patterns
and processes of purchases. The study of consumer behaviour provides us with reasons, why the
consumption behaviour differs from one another in buying and using product and services.
To Philip Kotler, Consumer buying behaviour refers to the buying behaviour of final consumer
individuals and households who buy goods and services for personal consumptions
To Schiffiman and Konuk, Consumer behaviour encompasses all the behaviour that consumers
displays in searching for, purchasing, using, evaluating and disposing of products and services that
they except will satisfy their need
To Batra & Kazmi, consumer behaviour refers to the mental and emotional process and the
observable behaviour consumers during searching, purchasing and post consumption of a product
or service
The study of consumer behaviour is the study of how individuals make decisions to spend
their available resources (Time, Money, and Effort) on consumption related items. It includes the
study of what they buy, why they buy it, when they buy it, where they buy it, how often they buy it
and how often they use it.
History of Consumer Behaviour
Debasis Pani, Asst. Professor, GIACR
The study of consumer behaviour was given due place in the microeconomic theory and
attracted the attention of economists. However at the time it was purely a part of economic theory,
viewing the behaviour of the consumer as a simple result of economic compulsion. Most of the
theories were developed on such analysis with the underlying assumption; consumer behaviour is a
uni-disciplinary economic activity.
By the later part of 20th century as marketing become more important activity, marketers
were seeking answer of the many questions they had how their consumers behaved.
Why certain products accept better acceptance than others.
Why even identical placed products had different receptions by the consumer.
The each economic theories of consumer behaviour were found to be inadequate. It was realized
that consumer behaviour is really much complex and interdisciplinary, and it involved concepts
from various human behaviour sciences. The effect of Sociology, Psychology, and Anthropology
besides Economics, on the behaviour of consumers was recognized and the science of consumer
behaviour takes root.
Why it is Important for Marketers?
Consumer behaviour study and consumer research are most important for the marketers
because these studies offers a possibility to better understand what happens in business world,
why someone is successful and someone else not. The study of CB provides the marketer an
important input for product planning, design modification, and promotional strategy by unveiling
certain answer to the questions like
What kinds of consumer buy our proposed product or services?
What feature do they look for?
What benefits do they seek?
How they use? And for what reasons?
How likely they to replace their old models with added features are become available?
Consumer An Enigma (Black Box)
Marketers put their sincere effort to understand
and influence the consumer behaviour, but inspite of
all their effort, companies have not been successful at
conceptualizing
consumer
behaviour.
Because
consumer shows all types of dynamism in his
behaviour, as today he is using one brand tomorrow he
may ask another brand and day after tomorrow he
may ask a new brand.
So at one end we can compare the behaviour of
the consumer is just like a ravenous chameleon that
changes its colour as per the surrounding. Likewise
consumer also engages and creates from the existing
brand, using materials to produce different outcomes
for their own creative purposes. So the buyer or
consumer continues to be and enigma for that reason
the buyers mind has been termed as a black-box.
Because any object inside the black box is not visible
as the box itself in not transparent. similarly what sort of thinking going on in the mind of the
customer is not visible.
Consumer Mind A Black box
Stimulus
Company controlled product, price, advertising, sales promotion, display, distribution.
Social word of mouth reference group
Consumer mind (Black box)Response
The marketer provides stimuli but he is uncertain of the buyers response. The stimulus is a
combination of product, brand name, colour, style packaging, intangible services, merchandising,
shelf display, advertising, distribution, publicity and so forth.
Nothing better illustrates this enigmatic buyer than the failure of an herbal anti-cold balm
launched by Warner Hindustan. Though the balm market has grown significantly and Vicks vaporub
had been dominating the anti-cold rub segment for more than two decades. Now Waner failed did
the consumer see no significant difference between Vicks and Waner. This has remained an enigma.
Today customer is being greatly influenced by media especially electronics, Technological
development in the field of information. Clearly the internet has today forced the customer learning
and shopping behaviour. Multiple television channels are also shaping customers value. The
customer is aware than ever before of rights and choices available to him/her.
Today the consumer is willing to buy the book on the internet form US based Amazon. Com,
music from Sony, Banking for HDFC Bank in India, Airlines services for Jet Airways or order roses
form India to be delivered loved ones in the US on Valentines Day through 1-800-flowers.com
It is estimated on December 31, 2003 that 50 million people in India use internet out of
them 6.5% of the time is spent in E-commerce. The internet has created awareness among the
Indian consumers about quality and performance parameters that can get at an affordable price
(3rd Generation Mobile services)
I. Nature of Consumer Behaviour

Consumer behaviour is the subset of human behaviour and it is the function of the individual
involved. This can be presented nicely in below picture.
{1} CB is Person Specific: in our
daily experience we come across
many decision like purchasing food
item, soft drink, bathing soap. We
prefer
individually
television
programme telecasts on alternative
channels. It is true that we take
more or less time in taking those
decisions. In other words we take
more or less time in evaluating a
product or service before we
purchase. And while purchasing, we show a unique typical behaviour. Therefore the purchase
behaviour of an individual differs from others and it is unique to him.
{2} CB is Product Specific: we not only differ from other customers, but the purchase behaviour
of us is differing with product to product or product category to another. Suppose you have selected
LG Colour Television of 21 inch by spending almost one hour, but you might spend more in selecting
a LG Plasma Television and your evaluating criteria may certainly change when your are suppose to
purchase a Vidiocon washing machine.
{3} CB is Situation Specific: our purchasing and consumption behaviour for the same product
will differ depending on the situation where we are operating. For example our consumption of
sweet is more during festive days and almost we dont prefer non-vegetable items, so our
consumption behaviour on festive days is different from the ordinary days.
{4} CB is an Inter-disciplinary Science:
As consumer behaviour is a subset of human

behaviour,
so
all
behavioural
sciences play important role.
It borrows heavily from
concepts developed in other fields
such as psychology (study of
individual), sociology (study of
groups), social psychology (study
of how an individual operates in
groups),
anthropology
(the
influence
of
society
on
the
individual) and economies (the
study of behaviour of people in product, distribution and consumption of goods and services)
{5} CB is Complex Process: consumer behaviour is really a complex process because what sort
of thinking goes in the mind of the customer is not known to all, difficult to predict. Moreover it is
influenced by several internal and external factors, that is why it is difficult to understand.
II. Scope of Consumer Behaviour

The scope of a subject refers to
everything that is studied as part of that
subject. When we set out to explain the
scope of consumer behaviour we need to
refer to all that which forms part of
consumer behaviour.
The scope of consumer behaviour
covers all the answer the following
questions, which are very often raised
during consumer decision making process.
What they buy?
Why they buy?
When they buy?
Where they buy it?
How often they buy it?
How do they buy it?
To define the scope of a subject it is
important to set limit or a framework
within which it shall be studied. Side figure
presents one such framework for studying consumer behaviour. This framework is made up of three
main sections. The study of all these three sections constitutes the scope of consumer behaviour.
Section 1: The Decision Process the decision process as represented by the inner-most circle.
The decision process includes five stages as problem recognition, information search, and
evaluation of alternatives, purchase decision and post purchase behaviour.
Section 2: The Individual Determinants the individual determinants on the middle Circle, it
include all the psychological factors like perception, motivation, attitude, personality and learning.
All these psychological factors are internal in nature, influence the decision making process.
Section 3: The External Environment the external environment which is represented by the
outer circle, it includes cultural and sub-cultural influence, family influence, social group influence,
social class influence, personal influence. All these factors are external in nature, influences the
decision making process.
III. Consumer Decision Making

Everyday each of us makes numerous decisions concerning every aspect of our daily lives.
In most general terms a decisions is the selection of an opinion from two or more alternatives from
which to choose and is literally forced to make a particular purchase. Freedom often is expressed in
terms of wide range of product choices.
Levels of Consumer Decision Making

[A] Extensive Problem Solving (EPS): When consumers buy a new or unfamiliar product it usually
involves the need to obtain substantial information and a long time to choose. They must form the
concept of a new product category and determine the criteria to be used in choosing the product or
brand. At this level, the consumer needs a great deal of information for establish a set of criteria on
which to judge specific brands and a corresponding large amount of information concerning each of
the brand consideration.
[B] Limited Problem Solving (LPS): - Sometimes consumers are familiar with both product category
and various brands in that category, but they have not fully established brand preferences. They
search for additional information helped them to discriminate among various brands. Their search
for additional information is like fine-tuning, they must gather additional brand information to
discriminate among the various brands.
[C] Routinized Problem Solving (RPS): - consumers have some experience with the product
category and a well established set of criteria with which to evaluate the brands they are
considering. In some situations they may search for a small amount of additional information in
orders. Consumers involve in habitual and automatic purchases They simply review that already
know.
A Model of Consumer Decision Making
CONSUMER DECISION-MAKING
MODEL
INPUT
FIRMS MARKETING EFFORTS
PRODUCT
PRICE
PROMOTION
DISTRIBUTION
SOCIO-CULTURAL
ENVIRONMENT
FAMILY
INFORMAL SOURCES
OTHER NON-COMMERCIAL
SOURCES
SOCIAL CLASS
SUB-CULTURE
Debasis Pani, Asst.
Professor,
GIACR
AND
CULTURE
PROCESS
NEED
RECOGNITION
PRE-PURCHASE
SEARCH
EVALUATION OF
ALTERNATIVES
PSYCHOLOGICAL
FIELD
MOTIVATION
PERCEPTION
LEARNING
PERSONALITY
ATTITUDES
EXPERIENCE
PURCHASE
TRIAL
REPEAT PURCHASE
POST-PURCHASE
EVALUATION
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OUTPUT
( A ) Input
The input component of our consumer decision making model depends on external influence that
serves as source of information about a particular product and influences a consumers product
related values, attributes and behaviours.
1. Marketing Inputs: These inputs to the consumers decision making process take the form of
specific marketing mix strategies i.e. through product, price, place & promotion. Marketers
carry out market research fro the purpose of making their marketing input more strong
enough to remain alert to consumer perception.
2. Socio Cultural Inputs : Consists of a wide range of non-commercial influences e.g. the
comment of a friend and editorial in news paper, usages by family member or an article in
consumer reports are all specific and direct non-commercial sources of information.
The influence of social class, culture and sub-culture although less tangible are
important input factors that are internalize and affect how consumers evaluate and
ultimately adopt or reject products.
The collective impact of each firms marketing input and socio cultural inputs that are
likely to affect what consumers purchase and how they use what they buy.
( B ) Process
1. Psychological Field: represents the internal influence
Motivation - The driving force within the individual that impels them into action.
Perception - The process by which an individual select, organize and interprets stimuli into a
meaningful and coherent picture of the world.
Learning The process by which individuals acquire the knowledge and experience they
apply to future purchase and consumption behaviour.
Personality The psychological characteristics that both determine and reflect how a person
responds to his or her environment.
Attitude - A learning predisposition to behave in a consistently favorable or unfavorable
manner with respect to a given object.
2. Need Recognition: is likely to occur when a consumer is faced with a problem. Among consumers
there seems to be two different need or problem recognition styles. Some consumers are actual
state types who perceive that they have a problem when a product fails to perform satisfactory e.g.
a wristwatch no longer keeps accurate time. In contrast other consumers are desired state types
for whom the desire for some thing new may trigger the process.
Need or problem recognition also can be viewed as either simple or complex. Becoming
hungry and purchasing a candy bar from a vending machine (simple). Purchasing a luxury car, to
present as a gift for your wife on her birthday (Complex).
3. Pre-purchase Search: when a consumer perceives a need that might be satisfied by the
purchase and consumption of a product. But in all such purchasing situation consumer always
keeps himself or herself at safe side. Because a risk is associated with purchase. So inorder to
avoid risk it seek information. Past experience is considered an internal source of information.
Sometime it seeks information from external sources. In high risks situations consumers are likely
to engage in complex information search and evaluation.
4. Evaluation of Alternatives: when evaluate potential alternatives consumer tends to use two types
of information.
a) A list of brands from which plan to make selection.
b) The criteria they will use to evaluate each brand.
Evoked set : refers to the specific brands a consumer considers in making a purchase with in
a particular product category
Inept set: which consists of brands the consumer excludes from purchase consideration
because they are felt to be unaccepted.
Inert set: which consists brands the consumer is indifferent toward because they are
perceived as not having any particular advantage.
There are five expected reason for not selecting the brand to purchase form the consumer point of
view. They are as follows
1) Brands may be unknown because of consumers selective exposure to advertising media and
selective perception of advertising stimuli.
2) Brands may be unacceptable because of poor qualities or attributes or inappropriate
positioning in either advertising or product characteristics.
3) Brands may be perceived as not having any special benefit is regarded indifferently by the
consumer.
4) Brands may be overlooked (fail to see / ignore) because they have not been clearly
positioned.
5) Brands may not be selected because they are perceived by consumer as unable to satisfy
perceived needs.
The implication for marketers is promotional techniques should be designed to impart a more
favourable, perhaps more relevant product image to the target consumer. This may also require a
change in product feature or attributes.
Criteria Used for Evaluate Brands: When a company knows that consumer will be evaluating
alternatives, they some times advertise in a way that recommends the criteria that consumers
should use in assessing product or services option. Marketers effort in positioning the brand in such
a way that, brands names often reflect personality characteristics of childhood experience and it is
often love at first sight
We have possibly all gone through the experience of comparing or evaluating different
brands or models of a product and finding out the one that just feel, look and/or perform right.;
( C ) Output
I Purchase Behaviour: consumers make three types of purchase, Trial purchase, Repeat purchase
and Long-term purchases.
a) Trial is the exploratory phase of purchase behaviour in which consumers attempt to
evaluate a product through direct use.
b) Repeat purchase behaviour is closely related to the concept of brand loyalty which most
firms try to encourage, because it contributes to greater stability in the market place.
c) Long-term commercial purchase is not always feasible e.g. with most durable goods a
consumer usually moves directly from evaluating a long-term commitment without the
opportunity for an actual trial.
II. Post-purchase Evaluation: There are three possible outcomes of these evaluations
a) Actual performance matches expectations, leading to satisfaction or a normal behaviour.
b) Performance exceeds expectations, which lead to delight.
c) Performance is below expectations causing dissatisfaction.
An important component of post-purchase evaluation is the reduction of uncertainty or doubt that
the consumer might have had about the selection. As part of their purchase analysis, consumer try
to reassure them shelves that their choice was a wise one that they attempt to reduce postpurchase cognitive dissonance.
Consumer Decision Rules (Choice Heuristic)

1.
2.
3.
4.
How do consumers choose one brand from among the brand alternatives?
Do consumers use any identifiable and visible choice rule for evaluation?
Do consumers select the best alternative and reject the bad ones?
How do they find their way in a confusion of brand alternatives with significant attribute
differences?
Consumer Decision Rules is the Procedures adopted by consumers to reduce the complexity of
making products and brand decisions
Every consumers use a set of rules for evaluation for any kind of purchase. Consumers make a
variety of choices over time with reference to various products and brands on the basis of available
information to them. These are made on the basis of certain criteria known as decision rules or
heuristics. Such heuristics allow consumers to make complex decisions reasonably and effectively.
Advantage of Decision Rule
To consumers, the use of choice rules or rules of thumb offer many advantages.
1. They, for instance, provide with guidance while making decisions;
2. offer a short cut to a decision;
3. allow them to integrate and arrange information in such a way that decisions may be made
quickly and easily; and
4. In consumer information processing help them better in facing complexities
Consumer decision has been broadly classified into two major categories compensatory and
non-compensatory decision rules.
(1) In compensatory decision rules Consumers evaluate brand or model in terms of each
attribute and computes a weighted score for each brand. The computed score reflects the brands
relative merit as a potential purchase choice. The assumption is that consumer will select the brand
that scores highest among alternative brands. The unique feature of this rule is that it balances the
positive evaluation of a brand on one attribute to balance out a negative evaluation on some other
attribute. For example, a person intending to buy a family car may find styling, low maintenance
cost, fuel efficiency and price as the attributes of the car. Positive attribute like high fuel efficiency
is balanced with the negative evaluation of high maintenance cost.
(2) In contrast, non-compensatory decision rule do not allow consumers to balance positive
evaluation of a brand or one attribute against negative evaluation on some other attributes. E.g. in
case of an energy saving light bulb, the process negative rating on these light output would not be
offset by a positive evaluation of its energy saving. There are three type of non-compensatory
decision rules considered briefly here.
Conjunctive Decision Rule: the consumer establishes a separate minimally acceptable level
as a cut off point for each attribute. If any particular brand falls below the cut off point on
any attribute, the brand is eliminated from further consideration. Example, if a buyer of
refrigerator is considering three major brand alternatives, he may set a minimum cut-off
score of 3 out of maximum 10 marks on all the three attributes. Godrej fridge will be
dropped as it scores only 2 out of 10 on the Economy attribute. Though the conjunctive
choice heuristic aids in screening brand alternatives, it weighs negative information more
than the positive information in the evaluation.
Disjunctive Decision Rule: is the mirror image of the conjunctive rule. In applying for the
decision rule the consumer also establishes a separate, minimally acceptable level as the cut
off point for each attribute. The difference, however, lies in the fact that this, heuristic
stresses only the `salient' brand attributes (on the basis of weights) and accepts a brand
alternative if its performance exceeds the minimum cut-off performance on these dominant
attributes. Thus, in table, brand Godrej will be accepted by the consumer if the minimum
cut-off for the dominant attribute of low maintenance cost is 5. It will be in spite of the fact
that the overall performance of Godrej is lower than that of the other two 'brand
alternatives.
Lexicographic Decision Rule: the consumer first ranks the attributes in terms of perceived
relevance or importance. The consumer then compares the various brand alternatives in
terms of the single attribute that is considered most important. If one brand scores
sufficiently high attribute that is considered most important. In order to apply this heuristic,
buyers first rate the importance of attributes in the brands alternatives (column 2 of Table).
Thereafter, the brand alternatives are rated on these attributes (columns 3, 4 and 5 of
Table). The brand alternative that scores the highest on the most important attribute is
chosen, regardless of other attribute values. If all the brand alternatives score equally on
this attribute, then their scores on the second most important attribute is considered and
the highest scoring brand is chosen. Interpreting Table, as per the Lexicographic heuristic,
Godrej brand will be selected as it scores 5 out of 10 - higher than the other two brand
alternatives, on the most important attribute, i.e., low maintenance cost.
Decision Rules and Marketing Strategy: an understanding of which decision rule consumers
apply in selecting a particular product or service is useful to market concerned with formulating a
promotional program. A marketer familiar with the prevailing decision rule can prepare a
promotional message in a format that would facilitate consumer information processing. The
promotional message might even suggest how potential consumers should make a decision.
IV. Four Views of Consumer Decision Making- Economic man, Cognitive man,
Emotional man, Passive man
{1} An Economic View: the consumer has often been characterized as making rational
decisions. This model, called the economic theory has been criticized by consumer researchers for a
number of reasons. To behave rationally in the economic sense a consumer would have to
Be aware of the entire available alternative product.
Be capable of correctly ranking each alternative in the term of benefit and disadvantage.
Be able to identify the one best alternative.
To a leading social scientist, the classical economic model of an all rational consumer is unrealistic
for following reasons.
People are limited by their existing skill, habits and reflexes.
People are limited by their existing value and goals.
People are limited by the extent of their knowledge
Consumers operate in an imperfect world in which they do not maximize their decisions in terms of
economic condition such as price quantity relationship managerial utility or indifference curves.
Indeed, the consumer generally is unwilling to engage in extensive decision making activities and
will settle, instead, for a satisfactory decision one that is good enough;
{2} A Passive View: - depicts the consumer as basically submissive to the shelf-serving interests
and promotional efforts to marketers. In the passive view consumers are perceived as impulsive
and irrational purchases ready to yield to the aim and arms of marketers. In this passive model of
the consumer was subscribed to hard driving super salesman of old who trained to regard the
consumer awes an object to be manipulated.
In the development of the selling process, there are four distinct stages first the salesman
must secure the prospects undivided attention. Secondly, this attention must be sustained and
developed into. Thirdly, their interest must be repined into desires. And fourthly, all lingering
doubts must be removed from the prospects mind and there must be implanted there a firm
resolution to buy; in other words, the sales must be closed.
All that we have studied about motivation selective perception, learning attitudes,
communication that consumers are rarely objects of manipulation. Therefore the simple and single
minded view should else be rejected unrealistic.
{3} A Cognitive View: - the third model portrays the consumer as a thinking problem solver.
With in the framework, consumers frequently are pictured as either receptive to or actively
searching for products and services that fulfil their needs and enrich their lives. The cognitive
model focuses on the process by which consumers seek and evaluate information about selected
brands and retail outlets.
Within the context of cognitive model, consumers are viewed as information processors.
Information processing leads to the formulation preferences and ultimately t purchase intentions
consumers also may use a preferences formulation strategy that is other based in which they
allow another person i.e. a trusted friend, and interior decorator, or an expert retail salesperson to
make the selection for them.
The cognitive or problem solving view describes a consumer who falls somewhere between
the extremer of the economic and passive views. The cognitive model seems to capture the
essence of well educated and involved consumer who seek information on which to base
consumption decisions.
{4}
An Emotional View: - although long aware of the emotional or impulsive model of
consumer decision making, marketers frequently prefer to think of consumers in terms of either
economic or passive model. In reality however, each of us is likely to associate deep feeling or
emotions such as joy, fear, love, hop, sexuality, fantasy and even a little magic with certain
purchase or possession. These feelings or emotions are likely to be highly involving.
If we were to reflect on the nature of our recent purchase, we might be surprised to realize
just how impulsive some of them were rather than carefully searching, deliberating and evaluating
alternatives before buying. We are just as likely to have emotionally driven go for it feel oriented
advertising
Consumer moods are also important to decision making. Mood can be defined as a feeling
state or state of mind. Unlike an emotion, which is a response to a particular environment, a mood
is more typically an unfocused, pre-existing state- already present at the time a consumer
experiences an Advertisement a retail environment, a brand or a product.
Mood appears to be important to consumer decision making, because it impacts on when
consumers shop, where they shop and whether they shop alone or with others. It also is likely to
influence how the consumer responds to actual shopping environments. i.e. at point of purchase.
Some retailers attempt to create a mood for shoppers.
V. Consumer Decision Making Process

The buyers decision process consists of five stages and it start before actual purchase and continue
long after. Marketer needs to focus on the entire buying process rather than on just purchase
decisions. Sometimes the consumer often skips or reserves some of these stages. The most
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important things to be considered by a marketer are to make all his promotion hitting the
consumers eye at each step of the whole process.
1st Need Recognition: is the first stage of the buyer decision process in which the consumer
recognizes a problem or need. The need can be trigged by internal stimuli when one of the persons
normal needs hunger, thirst, and sex-rises to a level high enough to become a drive. A need can
also be trigged by external stimuli e.g. advertising, discussing with friends. Role of the marketers in
this case
To understand the drives/ motives related to unlimited purchases
To uncover the latent need structure surrounding a particular product
To arrange cues to match with timing of need arousal
To provide information in order to push needs above the threshold level
2nd Information Search: if the consumes drive is strong and satisfactory product is near at hand,
the consumer is likely to buy it then. The stage of buyer decision process in which the consumer is
aroused to search for more information, the consumer may simply have heightened attention or
may go into active information search. Consumer can obtain information from any of several
sources. These include.
a) Personal sources family, friend neighbors, acquaintance.
b) Commercial sources advertising, sales people, dealers, packaging, displays
c) Public sources mass media, consumer retailing organization.
d) Experiential sources handling, examining suing the product.
Commercial sources normally inform the buyer but personal sources legitimize or evaluate products
for the buyer.
High risk situation followed by complex information search and evaluation.
Low risk situation followed by simple search and information tactics.
Unit of information search depends on experience, social acceptability (gift), product factor,
personal factors.
3rd Evaluation of Alternatives: the stage of the buyer decision process in which the consumer
uses information to evaluate alternative brands in the choice set. How consumers go about
evaluating purchases alternatives. In some cases, consumer use careful calculations and logical
thinking. At other times, the same consumers do little or no evaluating instead they buy on
impulsive and rely on intuition. Some times consumers make buying decision on their own; some
time they turn to friends, consumers guides, or sales people for buying advice.
Marketers should study buyers to find out how they actually evaluate brand alternatives. If
they know what evaluating processes go on marketers can take step to influence the buyers
decision.
Evaluation of potential alternatives is made from evoked set brands.
Criteria to be used for brand evaluation through Product attributes (selection of relevant
attributes, different weights to different attributes, developments of brand beliefs, utility
functions for each attributes, consumer arrival at an attitude) e.g. 100% fat free
Judgments or preference.
4th Purchase Decision: the buyers decision about which brand to purchase but two factors can
come between the purchase intention and the purchase decision. The first factor is attitude of
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others. The second factor is unexpected situational factors. The consumer may form a purchase
intention based on factors such as expected income, expected product benefits. However,
unexpected events may change the purchase intention.
After evaluation ranked set of preference is created and purchase intention is developed.
An attitude of others, unanticipated situational factors and perceived risks influences the
purchase decisions.
5th Post-purchase Behaviour: the stage of the buyer decision process in which consumers take
further action after purchase, based on their satisfaction or dissatisfaction.
The answer lies in the relationship between the consumers expectations and the products
perceived performance. If the product falls short of expectations the consumer is disappointed. If it
meets expectations, the consumer is delight.
Cognitive dissonance: buyers discomfort caused by post-purchase conflict. Customer satisfactions
are a key to building profitable relationships with consumers to keeping and growing consumers
and repeating their customer life time value. A dissatisfied consumer responds differently. Bad word
of mouth often travels further and faster than good word of mouth.
Therefore a company should measure customer satisfaction regularly. It should setup
systems that encourage customers to complain. In this way the company can learn how well it is
doing and how it can improve.
Satisfaction is a function of expectation and perceived benefit S=f(E,P)
If P>E = Consumer Delight, P=E = Consumer Satisfaction and P<E = Consumer Dissatisfaction.
Strategies by consumers to rationalize decision (change evaluation of alternatives, seeking
positive information, changing attitudes, may persuades friends/neighbors to try same
brand)
Marketing implication ( confirm expectations, inducing attitude change, reinforcing buyers)
VI. Factors Influencing Consumer Decision Making Process
{1} Cultural Factors:

Culture refers to the customs and beliefs, art, way of life and social organization of a particular
country or group. Cultural factors have a significant impact on customer behavior. Culture is the
most basic cause of a persons wants and behavior. Marketers are always trying to spot cultural
shifts which might point to new products that might be wanted by customers or to increased
demand.
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Similarly the increased desire for leisure time has resulted in increased demand for
convenience products and services such as microwave ovens, ready meals and direct marketing
service businesses such as telephone banking and insurance.
Each culture contains Sub-Cultures groups of people with share values. Sub-cultures can
include nationalities, religions, racial groups, or groups of people sharing the same geographical
location. Sometimes a sub-culture will create a substantial and distinctive market segment of its
own. For example, the youth culture or club culture has quite distinct values and buying
characteristics from the much older gray generation
Similarly, differences in social class can create customer groups. It is measured as a combination
of occupation, income, education, wealth and other variables
{2}Social Factors:
A customers buying behavior is also influenced by social factors, such as the groups to which the
customer belongs and social status.
Reference Groups: In a group, several individuals may interact to influence the purchase
decision.
The groups with whom you interact directly or indirectly influence your purchase decisions and thus
their study is of great importance to marketer. These groups can sever as a reference group for a
consumer if it serves as a point of reference or comparison the formation of the values, attitudes
and behavior.
Different kinds of groups, whether small or large, formal or reference group is a very wide
one and includes both direct and indirect or group influences.
Direct reference groups, which exert a significant influence on consumers, purchase decisions and
behavior, can be classified into six categories. There are the family, Friendship groups, Formal social
groups, Formal shopping groups, Consumer action groups, and Work groups.
Indirect reference groups comprise those individuals or groups with whom an individual does not
have any direct face to face contact, such as film stars, TV stars, sportsman, and politicians.
Reference groups are used in advertising to appeal to different market segments, group situation
with which potential customers can identify are used to promote products and services.
Three
types of reference groups appeals most commonly used are:
a) Celebrities: are well known people (in their specific field of activity) who are admired and their
fans aspire to follow their behavior. Film stars and sports heroes are the most popular celebrities.
Soft drink (Thums up), shaving cream (Palmolive), toilet soaps (Lux) are advertised using
celebrities from the sports and film fields.
b) Experts: such as doctors, lawyer, accountants and authors are used for establishing the benefits
of the product. Colgate and Forhans toothpastes are examples of products, which use the expert
reference groups appeal for promotion.
c) The common man: Another reference group appeal is that which uses the testimonials of a
satisfied customer. It demonstrates to the prospective customer that demonstrates just like him
uses and is satisfied with the product.
Family: a group consisting of one or two parents and their children the other members of my
family who have a blood relation or relation by adoption. The family of orientation consists of ones
parents and siblings. From parents, a person acquires an orientation toward religion, politics, and
economics as well as a sense of personal ambition, self-worth, and love. Marketers are interested
in the roles and relative influence of the husband, wife, and children in the purchase of a large
variety of products and services.
The family also plays a role in consumer decision-making, as shown Roles: An individual
may participate in many groups. His position within each group can be defined in terms of the
activities he is expected to perform. You are probably a manager, and when in your work situation
you play that role. However, at home you play the role of spouse and parent. Thus in different
social positions you play different roles. Each of these roles influences your purchase decisions.
Status: Each role that a person plays has status, which is the relative prestige accorded by society.
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Status is often measured by the degree of influence an individual exerts in the behaviour and
attitude of others. People buy and use products that reflect their status.
{3} Personal Factors:
Age and Life cycle Stage: Like the social class the human life cycle can have a significant impact
on consumer behaviour. The life cycle is an orderly series of stages in which consumer attitude and
behavioural tendencies evolve and occur because of developing maturity, experience, income, and
status. Marketers often define their target market in terms of the consumers present lifecycle
stage. The concept of lifecycle as applied to marketing will be discussed in more details.
Occupation And Income: The profession or the occupation a person is in again has an impact on
the products they consume. The status of a person is projected through various symbols like the
dress, accessories and possessions.
Life Style: Our life styles are reflected in our personalities and self-concepts, same is the case with
any consumer. We need to know what a life-style is made of. It is a persons mode of living as
identified by his or her activities, interest and opinions. There is a method of measuring a
consumers lifestyle. This method is called as the psychographics-which is the analysis technique
used to measure consumer lifestyles- peoples activities, interests and opinions.
Personality: personality is the sum total of an individuals enduring internal psychological traits
that make him or her unique. Self-confidence, dominance, autonomy, sociability, defensiveness,
adaptability, and emotional stability are selected personality traits.
{4} Psychological Factors:

Motivation: Motivation involves the positive or negative needs, goals, and desires that impel a
person to or away from certain actions. By appealing to motives (reasons for behavior), a marketer
can generate motivation. Economic and emotional motives are possible. Each person has distinct
motives for purchases; these change by situation and over time.
We all have needs we consume different goods and services with the expectation that they
will help fulfill these needs. When a need is sufficiently pressing, it directs the person to seek its
satisfaction. It is known as motive. All our needs can be classified into two categoriesprimary and
secondary.
Perception: The second major psychological factor that influences consumer behavior is
perception. Perception can be described as how we see the world around us. All the time we are
receding messages through our five organs viz.., eyes, ears, nose, mouth and skin. The different
sights, sounds, smells, tastes and sensations that we feel are known as stimuli. Each person
recognizes, selects, organizes and interprets these stimuli in his own individual manner based in his
needs, values and expectations and this is known as perception. Since each individuals needs,
motive and expectations are unique therefore each individuals perception is unique.
As a marketing manager, you are providing stimulus to your consumers through the physical
shape, color, size, fragrance, feel, taste of your product, its package, advertisement and
commercials.
Learning: Learning refers to the skill and knowledge gained from past experience that we apply to
evaluate future decisions and situations. A marketer can build up demand for his brand by
associating it with strong motives, using the appropriate stimuli and cues and providing positive
reinforcement. Thus making the consumer learn that the brand is good and worth patronizing.
Beliefs & Attitudes: A belief is a descriptive thought that a person has about something. A person
may believe that a certain coking oil Sunflower has the lowest fat content and is best for health.
This belief may be based on some real facts or it may merely be a notion or opinion that the person
has. The beliefs constitute the brand image about the brand. The marketer must ensure that
consumers have relevant and correct information about the brand to facilitate formation of a
positive brand image.
Attitude is a persons enduring feeling, evaluation and tendency towards a particular idea or
object. Starting from childhood, attitude develops over the time with each fresh knowledge input,
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experience and influence. Attitudes get settled into specific patterns and are difficult to change. It
is easier to market product that fits in well with the existing patterns of attitudes rather than
change the attitudes to fit a new product concept.
VI. Comprehensive Models of Consumer Decision Making: Nicosia Model,

Howard-Sheth Model, Engel-Kollat-Blackwell Model. (Study Material)
VII. Some Important Concepts {Out of Syllabus}

Types of Buying Decision Behaviour (Henery Assesl Matrix)
Between
Few
Complex Buying
Behaviour
Varity Seeking
Buying Behaviour
Dissonance Reducing
Buying Behaviour
Habitual
Buying Behaviour
Between
High Involvement
Significant
Difference
Brands
Difference
Brands
Low Involvement
A. Complex Buying Behaviour:- consumer undertakes when they are highly involved in a
picture and perceived significant difference among brands. Consumer may be highly involved when
the product is expensive, risky, purchased infrequently and highly self expressive.
The buyer passes through a learning process, first developing beliefs about the
product than attributes, and then making a thoughtful purchase choice. Marketers of high
involvement products must understand information gathering and evaluation behaviour of highinvolvement consumers. They must motivate sales people and the buyers acquaintance to
influence the find brand choice.
Complex decision making
High uncertain level
Focused communication needed
Comprehensive positioning
Strategies for reducing stressing
Multiple attributes of brands
B. Dissonance- Reducing Buying Behaviour:- occurs when consumers are highly involved with
an expensive, infrequent or risky purchases but see little difference among brands. In this case,
because perceived brand difference are not large, buyers may shop around to learn what is
available but buy relative quickly. They may respond primarily to a good price or to purchase
convenience.
After the purchase consumers might experience post purchase dissonance (after sale
discomfort). To counter dissonance, the marketers after sales communication should provide
evidence and support to help consumers feel good about their brand choice.
Positioning is most important
Creation of USP or brand image.
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Decision making is complex

Loyalty develops after positive use experience
C. Habitual Buying Behaviour: - occurs under conditions of low consumer involvement and little
significant brand difference. In this the consumer positively receives information as they watch
television or read magazines. Advertisement repetition creates brand familiarity rather than brand
conviction consumer does not form strong attitudes towards a brand; they select the brand
because it is familiar. Because they are mot highly involved with the product, consumer may highly
evaluate the choice after purchase. In advertisement of low involvement product, advertisement
copy should stress only a few points. Visual symbols and imaginary are important because they can
be remembered easily and associated with the brand. Advertising campaign should include high
repetition of short duration messages.
Information search is limited
Favourable experience repurchases
Low involvement of consumers
Decision making process is simple
Moderate brand evaluation
Varity seeking behaviour
D. Varity Seeking Buying Behaviour: - occurs in situation characterized by low consumer
involvement but significant perceived brand difference. In such cases, consumer often does a lot of
brand switching for the sake of variety rather than because of dissatisfaction.
In such product category the market leader will try to encourage habitual buying behaviour
by dominating shelf space, keeping shelves fully stocked, and running frequently reminder
advertising. Challenger minor brand firms will encourage variety seeking by offering lower price,
special deals coupons free sample, and advertising that presents reasons for trying something new.
Positive experience repurchases
Brand choice habitual
Information search is non existent
Buyers prefer to stay with familiar brands
Roles in Consumer Decision Making

Often we find in a consumer decision process several individuals get involved. Each of them plays
an influencing role.
Initiator: this is a person who shows the seed in a customers mind to buy a product. This
person may be a part of customers family like child, spouse or parents. Alternatively the
persons may be a friend, a relative, a colleague or even the salesperson.
Influencer: this is a person with in or outside the immediate family of the customer who
influences the decision process. The individual perceived as an influencer is also perceived
as an expert. In consumer durable sale. The dealer plays an influencing role.
Decider: this is the person who actually takes the decision. In joint family- the elder in the
family, nuclear family literacy among women.
Buyer: this is the person who actually buys the product. This could be decider himself or
herself or the initiator.
User: this is the person/ who actually consumes the product. This could be the entire family
or just one person with in the customers family.
People who play these roles seek different values in the product or services. The perception of the
value is a larger extent influenced by their prior experience or that oh the experience of other,
media reports and the marketing created by the firm. These values which may also be referred to
as market value are potential of a product or service to satisfy customers need and wants.
Buying Motives
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And individual consumer is one who buys goods and services to satisfy his personal or household
wants. An individual consumer purchases product for these important reasons.
1. He has a desire which needs to be satisfied
2. He has an urge which includes him to purchase; and
3. He has reasoning.
Broadly speaking individuals are motivated to buy external and internal forces.
I External Motives: - are outside one self, since a consumer is the product of his environment,
hence mans attitude and behaviour influences his culture and various factors like income,
occupation, religion, culture, the family and social environment act as motives.
II Internal Motives:1. Rational buying motives: - which are based on logical reasoning of thinking. Prof Copeland
enumerates under such motives handiness; dependability in quality and use; durability; happiness;
healthfulness; efficiently in operation and use; reliability of auxiliary of earning and enhancing of
productivity.
2. Emotional buying motives: - which are based on personal feelings and cover a wide range of
international motives including, impulsive, instincts habits and drives and are varied in nature. To
Prof Copeland, these are emulation pride and ambition, economic emulation, social achievement,
happy seldom of gifts, maintaining and preserving, health, satisfaction of appetite, proficiency,
expression of artistic taste ambition, romantic instinct, securing personal comfort, security from
danger, securing comfort and obtaining greater leisure, distinctiveness, desire for recession and
entertainment, cleanliness, pride of personal appearance satisfaction of physical and emotional
appetites alleviation of laborious task and pleasing sense of taste.
Buying Behaviour of Indian Consumer

(1) Bargaining: - a trend of bargaining is often found in the behaviour of Indian buyers. They
prefer buying goods by reducing the price as told by the seller. Indian buyers too do not
frame uniform price policy. The trend of bargaining is still vogue in the Indian market.
(2) Quality Vs Price: - Indian buyers focus on price instead of the variety of the goods. They
therefore, prefer high price goods. A little bit change has come now because the consumers
have now begun purchase of quality goods on higher price.
(3) Brand or Trademark consciousness it is the characteristics of the behaviour so Indian buyer
that he appears now aware of the brand or items and considers these goods authentic
higher quality.
(4) Changing Consumption Pattern: - owing to widespread education increases in income and
standard of living as also desire of more comforts, the patterns of consumption is now
being changed.
(5) Role of Women: - the role of women is increasing day to day in the manner of discussion for
purchase. The women do purchase of all kinds particularly in families who are the husbands
earn the bread.
(6) Credit and Guarantee:- new motives for purchase are getting their way rapidly because of
having credit and guarantee facility available in the market such facilities are developing the
trade commerce.
(7) Complaining; - Buyers are gradually being aware of their rights. They have started
exhibiting their complaints through media and representatives before concerned authorities
and the forum. They can lodge their complaint before consumer forum and thus can receive
the compensation against the damage/ loss so sustained.
Expected Short Question

Practical loyalist- those who buy the lowest priced items with little or no regard for brand.
Opportunistic switchers - those who use coupons or sales to decide among brands and products
that fall with in their evoked set.
Deal hunter- those who look for the best bargain and are not brand loyal.
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Consumption vision - a mental picture or visual image of specific usage outcomes and/or
consumption consequences
Word-Of-Mouth - Informal conversations concerning products or services
Feed Back - The response given by a receiver to the sender of the message
Consumer Socialization - The process, started in childhood by which an individual first learns the
skills and attitudes relevant to consumer purchase behaviour
Organisational Consumer - A business, government agency, or other Institution that buys the
goods, services, and/ or equipment necessary for the organization to function
Consumer, Customer, Behaviour, consumer behaviour, Interdisciplinary science, Black-box, Stimuli,
EPS, LPS, RPS, Actual state and desired state, Evoked set, Inert set, Inept set, Cognitive
dissonance, Decision rules or Choice heuristic, Compensatory decision rule, Non-compensatory
decision rule, Conjunctive decision rule, Disjunctive decision rule, Lexicographic decision rule,
Predisposition belief.
Individual Determinants of Behaviour

I. Individual Determinants of Behaviours
represents the internal influence
Motivation - The driving force within the individual that impels them into action.
Perception - The process by which an individual select, organize and interprets stimuli into a
meaningful and coherent picture of the world.
Learning The process by which individuals acquire the knowledge and experience they
apply to future purchase and consumption behaviour.
Personality The psychological characteristics that both determine and reflect how a person
responds to his or her environment.
Attitude - A learning predisposition to behave in a consistently favorable or unfavorable
manner with respect to a given object.
II. PERSONALITY
No two people are exactly the same - not even identical twins. Some people are anxious,
some are risk-taking, some highly-strung (Very nervous, worried); some are confident, some shy;
and some are quiet and some are loquacious (talking a lot). This issue of differences is fundamental
to the study of personality.
What is Personality?
The word personality derives from the Latin word persona which means mask. The study of
personality can be understood as the study of masks that people wear. These are the personas
that people not only project and display, but also include the inner parts of psychological
experience, which we collectively call our self.
To Schiffman and Kanuk, Personality is defined as those inner psychological characteristics
that both determine and reflect how a person responds to his or her environment
Personality is a much more dynamic concept which describes the growth and development
of an individual's whole psychological system. As you know the personality is the composite sum of
an individual's psychological traits, characteristics, motives, habits, attitudes, beliefs and outlooks.
Over the years many different definitions have been proposed. One of the most widely used is that
by Allport according to which personality is defined as an `internal system' which includes all those
aspects of a person that are inherited as well as those that are learned. These two internal aspects
are interdependent and cannot be isolated
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The Nature of Personality

In our study of personality, three distinct properties are of central importance:
Personality Reflects Individual Differences
1. An individuals personality is a unique combination of factors; no two individuals are exactly
alike.
2. Personality is a useful concept because it enables us to categorize consumers into different
groups on the basis of a single trait or a few traits.
Personality is Consistent and Enduring
1. Marketers learn which personality characteristics influence specific consumer responses and
attempt to appeal to relevant traits inherent in their target group of consumers.
2. Even though an individuals personality may be consistent, consumption behaviour often varies
considerably because of psychological, socio cultural and environmental factors that affect
behaviour.
Personality can Change
1. An individuals personality may be altered by major life events, such as the birth of a child, the
death of a loved one, a divorce, or a major career change.
2. An individuals personality also changes as part of a gradual maturing process.
a) Personality stereotypes may also change over time.
b) There is a prediction, for example, that a personality convergence is occurring between men and
women.
Theories of Personality
{A} Freudian Theory
Sigmund Freuds psychoanalytic theory of personality is the cornerstone of modern
psychology. This theory was built on the premise that unconscious needs or drives, especially
biological and sexual drives, are at the heart of human motivation and personality. Freud proposed
that every individual's personality is the product of a struggle among three interacting forces: the
id, the ego and the superego.
Id, Ego and Superego
Id (It) The Id is the warehouse of primitive and impulsive drives, such as: thirst, hunger, and
sex, for which the individual seeks immediate satisfaction without concern for the specific means of
that satisfaction. The function of the id is discharge tension and it frequently does this by
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demanding instant gratification, even at the cost

of violating the norms of society. The id therefore
operates on what is called the pleasure principle
Ego (I) is the individuals conscious control
which functions as an internal monitor that
attempts to balance the impulsive demands of
the id and the socio cultural constraints of the
superego. The ego comes into being because of
the limitations of the id in dealing with reality and
operates, therefore, on what is called the reality
principle. It seeks to achieve the pleasurable demands of the id in as realistic a way as possible.
Since many of the id's demands may be unrealistic, the ego develops ways to postpone, deflect or
substitute feasible alternatives to satisfy the id.
Superego (Over-I) is the individuals internal expression of societys moral and ethical codes of
conduct.
a) The superegos role is to see that the individual satisfies needs in a socially acceptable fashion.
b) The superego is a kind of brake that restrains or inhibits the impulsive forces of the id.
The superego strives for perfection. It develops through the reinforcement of approved behaviour
patterns and results from the internalisation of societal and parental standards of what is good and
bad. The superego is, therefore, the individual's moral code and helps in striving for perfection
The Ego and Superego play roles in each of the conscious, preconscious, and unconscious,
but that the unconscious is the domain of the Id and a large proportion of the Superego. Freud
proposed that every individual's personality is the product of a struggle among three interacting
forces: the id, the ego and the superego. According to this theory, these three systems are fully
developed and are in a state of balance in a normal healthy person. However, when one or more of
these systems is underdeveloped then the internal balance is
disturbed. This disturbance leads to dissatisfaction with the self
and the world in general.
Freud emphasized that an individuals personality is
formed as he or she passes through a number of distinct stages
of infant and childhood development. These distinct stages of
infant and childhood development are: oral, anal, phallic,
latent, and genital stages. An adults personality is determined
by how well he or she deals with the crises that are experienced
while passing through each of these stages.
Applications of Psychoanalytic Theory.
Psychoanalytic theory has been used occasionally by marketers as a basis for influencing
consumers. According to psychoanalytic theory, consumers are seen as having conflicting desires as
they are deal with with products to fulfil wants. And according to Freudian theory, anxiety is a key
concept emerging out of this conflict system. One application, therefore, is for consumers to
minimise the anxiety arising out of this conflict system by appealing to their tendencies of
fantasizing, wish fulfilment, aggressive impulses and the need to escape from life's pressures.
{A1} Jungian Personality Types
Carl Jung a disciple of Sigmund Fraud, to accept frauds sexual aspect of personality. He
wanted to develop his own method of psychotherapy known as Analytical Psychology. He believed
that people are shaped by the cumulative experience of the past generation. A central part of his
perspective was an emphasis or what he called collective unconscious a storehouse of memories
inherited from our ancestral past. For example, many people are afraid of dark because their direct
ancestors had good reason to exhibit this. Jungs personality types have been made particularly
useful for marketers that measures the following pairs of Jungian inspired psychological dimensions
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(1) Sensing Intuition: Sensing: refers to one of the five powers (sight, hearing, smell, taste and
touch) that your body uses to get information about the world around you. Intuition: the ability to
know by using your strong feelings rather than considering the facts
(2) Thinking Feeling: Thinking: the process of forming ideas or opinions about, Feeling:
something that you feel through the mind or through the senses.
(3) Extroversion Introversion: Extroversion: a lively and confident person who enjoys being with
other people, Introversion: a quiet person who is more interested in their own thoughts and
feelings than in spending time with other people
(4) Judging Perceiving: Judging: an opinion that you form about after thinking about it carefully
with the available information with you. Perceiving: to understand or think of in a particular way.
Each of these two points of dimension results two distinctly different personality characteristics that
offer a picture as to how consumers respond to the world around them.
{B} Social Psychological or Neo-Freudian Theory
Some social-psychologists have forwarded the view that, social relationships are
fundamental to the formations and development of personality. On the basis of their orientations in
relating to others, individual consumers tend to develop methods to cope with their anxieties,
Consumers have consequently been classified into three personality groups using what is called the
`CAD model' where CAD is an acronym that stands for compliance, aggression and detachment
i) Compliant Individuals: These individuals tend to move toward others. Compliant people have a
need for love, affection, approval and the desire to be appreciated. They are essentially
conformists.
ii) Aggressive Individuals: They tend to move against others. Their interpersonal orientations
display the ability to manipulate others. Such individuals also appear to have a need to achieve
success, to excel, to gain admiration and to be in a power position.
iii) Detached Individuals: these categories of persons tend to move away from others. Their
relationships emphasize the need for self-reliance, independence, and freedom.
Application of Social-psychological Theory
The CAD model was, in fact, developed for the specific purpose of studying buying behaviour
and it emphasises the effect of social influences on the personality. Thus, studies have shown that
compliant types have been found to prefer known products and brands while aggressive types have
been found to prefer specific brands out of a desire to be noticed, and also to use more of
aftershave lotions and colognes. In contrast, detached types appear to have the least awareness of
brands. The CAD approach is used by marketers to predict which consumers may be more or less
prone to group influence. The most important application of social-psychological theory is it's
emphasis on the social nature of consumption.
{C} Trait Theory
Trait theory is a significant departure from the earlier qualitative measures that are typical
of Freudian and neo-Freudian theory. It is primarily quantitative or empirical, focusing on the
measurement of personality in terms of specific psychological characteristics called traits.
A trait is defined as any distinguishing, relatively enduring way in which one individual
differs from another. Selected single-trait personality tests increasingly are being developed
specifically for use in consumer behaviour studies. Types of traits measured include:
i) Consumer innovativenesshow receptive a person is to new experiences or the degree to which
a person likes to try new things.
ii) Consumer materialismthe degree of the consumers attachment to worldly possessions. Or
amount of emphasis placed on acquiring and owning products
iii) Consumer ethnocentrismthe consumers likelihood to accept or reject foreign-made products.
Researchers have learned to expect personality to be linked to how consumers make their choices,
and to the purchase or consumption of a broad product category rather than a specific brand.
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Personality and Understanding Consumer Diversity

Marketers are interested in understanding how personality influences consumption
behaviour because such knowledge enables them to better understand consumers and to segment
and target those consumers who are likely to respond positively to their product or service
communications.
[1] Consumer Innovativeness and Related Personality Traits
Marketing practitioners must learn all they can about consumer innovatorsthose who are likely to
try new products. Those innovators are often crucial to the success of new products.
Consumer Innovativeness: How receptive is consumers to new products, new services, or new
practices? Such information is quite important to both consumers and marketers. Recent consumer
research indicates a positive relationship between innovative use of the Internet and buying online.
Dogmatism: is a personality trait that measures the degree of rigidity an individual displays
toward the unfamiliar and toward information that is contrary to their established beliefs.
Social Character: is a personality trait that ranges on a continuum from inner-directed to otherdirected. Inner-directed consumers tend to rely on their own inner values or standards in
evaluating new products and are innovators. They also prefer ads stressing product features and
personal benefits Other-directed consumers tend to look to others for direction and are not
innovators. They prefer ads that feature social environment and social acceptance.
Need for Uniqueness: These people avoid conventionality are the ones who seek to be unique!
Optimum Stimulation Level (OSL): is reflecting a persons desired level of lifestyle simulation.
Some people prefer a simple experience although others seem to prefer an environment complex,
and unusual experiences. Persons with optimum stimulation levels (OSLs) are willing to take risks,
to try new products, to be innovative, to seek purchase-related information, and to accept new
retail facilities. The correspondence between an individuals OSL and their actual circumstances has
a direct relationship to the amount of stimulation individuals desire. If the two are equivalent, they
tend to be satisfied. If bored, they are under stimulated, and vice versa.
Variety-Novelty Seeking: This is similar to OSL. Primary types are variety or novelty seeking.
There appear to be many different types of variety seeking:
Exploratory purchase behaviour (e.g., switching brands to experience new and possibly
better alternatives),
Vicarious exploration (e.g., where the consumer secures information about a new or
different alternative and then contemplates or even daydreams about the option), and
Use innovativeness (e.g., where the consumer uses an already adopted product in a new or
novel way).The third form of variety or novelty seekinguse innovativenessis particularly
relevant to technological.
Consumers with high variety seeking scores might also be attracted to brands that claim to have
novel or multiple uses or applications. Marketers, up to a point, benefit from thinking in terms of
offering additional options to consumers seeking more product variety. Ultimately, marketers must
walk the fine line between offering consumers too little and too much choice.
[2] Consumer Susceptibility to Interpersonal Influence
Susceptibility: a persons feelings which are likely to be easily hurt. SUSCEP is assumed to be a
general trait that reflects consumer differences in terms of response to social influence. There are
three types of interpersonal influence.
Informational influence: which is the tendency to accept information from others as
evidence about reality?
Value expressive influence: which captures consumers desires to enhance their standing
with others by being similar to them.
Utilitarian influence: where consumer conforms to the wishes of others to obtain a reward or
avoid punishment.
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[3] Cognitive Personality Factors

Market researchers want to understand how cognitive personality influences consumer behaviour.
Two cognitive personality traits have been useful in understanding selected aspects of consumer
behavior. They are: a) Need for cognition. b) Visualizers versus verbalizers.
Need for Cognition: This is the measurement of a persons craving for or enjoyment of thinking.
Consumers who are high in NC (need for cognition) are more likely to be responsive to the part of
an advertisement that is rich in product-related information of description. They are also more
responsive to cool colours. Consumers who are relatively low in NC are more likely to be attracted
to the background or peripheral aspects of an ad. They spend more time on print content and have
much stronger brand recall. Need for cognition seems to play a role in an individuals use of the
Internet.
Visualizers versus Verbalizers: Visualizers are consumers who prefer visual information and
products that stress the visual. Verbalizers are consumers who prefer written or verbal information
and products that stress the verbal. This distinction helps marketers know whether to stress visual
or written elements in their ads.
[4] Consumer Materialism to Compulsive Consumption
Consumer Materialism: Materialism is a trait of people who feel their possessions are essential to
their identity. They value acquiring and showing off possessions, they are self-centred and selfish,
they seek lifestyles full of possessions, and their possessions do not give them greater happiness.
Fixated Consumption Behaviour: Fixated refers to always thinking and talking about something
in a way that is not normal. So the consumer having this type of consumption behaviour shows
their abnormality in a socially acceptable fashion. This type of consumption behaviour falls
between, somewhere between being materialistic and being compulsive. Fixated consumers
characteristics: A deep (possibly: passionate) interest in a particular object or product category.
This profile of the fixated consumer describes many collectors or hobbyists (e.g., coin, stamp,
antique collectors, vintage wristwatch, or fountain pen collectors).
Compulsive Consumption Behaviour: Compulsive consumption is in the realm of abnormal
behaviour. Consumers who are compulsive have an addiction; in some respects, they are out of
control, and their actions may have damaging consequences to them and those around them. E.g.
Uncontrollable gambling, drug addiction, alcoholism.
[5] Consumer Ethnocentrism
Consumers who are highly ethnocentric are likely to feel that it is inappropriate or wrong to
purchase foreign made product because of economic impact on the domestic economy e.g.
Germanise and Japanese consumers are very ethnocentric. Where as non-ethnocentric consumers
tend to evaluate foreign made products more objectively for their extrinsic characteristics.
III. PERCEPTION
In a simple sense perception may be defined as how we see the world around us. Two individual
may be subject to the same stimulus under the same condition, but how each person select them,
organise them and interprets them is highly individual process based on each persons own need,
23
value and expectations. E.g. when there is violence killing of innocent people in Kashmir it is called
terrorism by India but those who do so call it struggle for freedom.
What is Perception?
Perception is the process of selecting, organizing and interpreting information inputs to
produce meaning.
This means we chose what info we pay attention to, organize it and interpret it. Information inputs
are the sensations received through sight, taste, hearing, smell and touch. Thus we can say that
the above definition of perception of perception lays emphasis on certain features:
Perception is a mental process, whereby an individual selects data or information from the
environment, organizes it and then draws significance or meaning from it.
Perception is basically a cognitive or thinking process and individual activities; emotions,
feelings etc. are based on his or her perceptions of their surroundings or environment.
Perception being an intellectual and cognitive process will be subjective in nature.
The key word in the definition of perception is individual. We can say that it is the process by which
an individual selects, organises and interprets information received from the environment
SensationAttending to an object/event with one of five senses
OrganisationCategorising by matching sensed stimulus with similar object in memory, e.g.
colour
InterpretationAttaching meaning to stimulus, making judgements as to value and liking,
e.g. bitter taste
Elements of Perception / Concepts of Perception

We will examine some of the basic concepts that underlie the perception process.
(A) Sensation: is the immediate and direct response of the sensory organs to stimuli (an
advertisement, a package, and a brand name). A stimulus is any unit of input to any of the senses.
Sensory receptors are the human organs (i.e., the eyes, ears, nose, mouth, and skin) that receive
sensory inputs, sight, sound, smell, taste, or touch.
Human sensitivity refers to the experience of sensation. Sensitivity to stimuli varies with the
quality of an individuals sensory receptors (eye sight and hearing) and the amount or
intensity of the stimuli to which he/she is exposed.
Sensation itself depends on energy change, the difference of input. Thus, a constant
environment, whether very busy and noisy or relatively quiet, would provide little sensation
because of the lack of change, the consistent level of stimulation.
As sensory input decreases, the ability to detect changes increases. This ability of the
human organism to accommodate itself to varying levels of sensitivity as external conditions
vary not only protects us from damaging, disruptive, or irrelevant bombardment when the
input level is high but has important implications for marketers.
(B) The Absolute Threshold: The lowest level at which an individual can experience a sensation
is called the absolute threshold. The point at which a person can detect the difference between
something and nothing is that persons absolute threshold for the stimulus. For example, the
distance at which a driver can note a specific billboard on a highway is that individuals absolute
threshold.
Marketers try to increase sensory input in order to cut through the daily clutter consumers
experience in the consumption of advertising.
Sensory adaptation is a problem that causes many advertisers to change their advertising
campaigns regularly. Sensory Adaptation refers specifically to getting used to certain
sensations, becoming accustomed to a certain level of stimulation.
Some advertisers uses silence (the absence of music or other audio effects) to generate
attention.
Some marketers seek unusual media in which to place their advertisements in an effort to
gain attention.
Some use scent researchers to enhance their products with a unique smell.
24
Package designers try to determine consumers absolute thresholds to make sure that their
new product designs will stand out from competitors packages on retailers shelves.
(C) The Differential Threshold: The minimal difference that can be detected between two stimuli
is called the difference threshold or the JND (just noticeable difference). A 19th century German
scientist named Ernst Weber discovered that the JND between two stimuli was not an absolute
amount, but an amount relative to the intensity of the first stimulus.
Webers law states that the stronger the initial stimulus, the greater the additional intensity
needed for the second stimulus to be perceived as different.
Also, an additional level of stimulus, equivalent to the JND must be added for the majority of
people to perceive a difference between the resulting stimulus and the initial stimulus. Webers law
holds for all senses and almost all levels of intensity. Retailers use the principle in reducing prices.
Markdowns must amount to at least twenty percent to be noticed by shoppers.
Marketing Applications of the J.N.D.: Let us look at the important applications of JND for
marketers:
1. Manufacturers and marketers endeavour to determine the relevant j.n.d. for their products so
that:
Negative changesreductions or increases in product size, or reduced qualityare not
readily noticeable to the public.
So that product improvements are readily noticeable to the
consumer without being wastefully extravagant.
2. Marketers use the j.n.d. to determine the amount of change or updating
they should make in their products to avoid losing the readily recognized
aspects of their products
3. To better compete in a global marketplace that has been radically altered
by computer technology, many companies are updating their corporate
logos to convey the notion that they are timely and fast-paced and at the
top of their respective product class.
a. Many feature some element that conveys motion streaking, slashing,
and orbiting.
4. Although some companies make minor changes (below the j.n.d.) to promote continuity, others
have deliberately changed their traditional block lettering and dark colours in favour of script
typefaces, bright colours, and hints of animation e.g. pop icons like MTV, Channel V.
5. Marketers want to meet or exceed the consumers differential threshold so that they readily
perceive the improvements made in the original product.
(D) Subliminal Perception: subliminal means affecting your mind even though you are not aware
of it. Stimuli below the lumen of conscious awareness, too weak or brief to be consciously seen or
heard, may be strong enough to be perceived by one or more receptor cells. This is subliminal
perception. Some time people are also stimulated below their level of conscious awarenessthey
can perceive stimuli without being consciously aware of it.
In general there are three types of subliminal perception as
Briefly presented visual stimuli
Accelerated speech in low volume auditory message
Embedded or hidden imagery or words (often sexual nature) in print ads or product labels.
Example: In the year 1957 there was a firm called Subliminal Projection Company inserted
message in theatre by flashing the words eat popcorn and drink coke for 1/3000 second every
five seconds on the screen during the movie, so quickly that the audience was not aware of it. In a
six-week test sales of popcorn increased by almost 20 per cent and consumption of Coke grew by
almost 60 per cent. These claims created strong protest across America
Evaluating the Effectiveness of Subliminal Persuasion
To study the effectiveness of subliminal perception, the following key issues are important:
25
There is no evidence that subliminal advertising works! Current research is based on two
approaches.
The first theory is that constant repetition of very weak stimuli will have an incremental
effect that enables such stimuli to build response strength over many presentations on TV
screen or played on sound tracks.
A second approach is based on sexual stimulation through sexual stimuli arouse unconscious
sexual motivation.
The Nature of Perception

Information processing is a series of activities by which stimuli are perceived, transformed
into information and stored. There are four major stages in the information-processing model, viz.,
exposure, attention, interpretation and memory. It is the first three, which constitute the
perception process.
Exposure occurs when a
stimulus
such
as
an
advertisement comes within
range of a persons sensory
receptor through nerves-vision.
Attention occurs when the
receptor
nerves
pass
the
sensation on to the brain for
processing. Target customer
allocates cognitive processing
capacity i.e. pays attention to
ad.
Interpretation
is
the
assignment of meaning to the
received
sensations.
Target
customer
interprets
the
message i.e. message sent =
message received
Memory is the shortterm use of the meaning for the immediate decision making and the longer-term retention of the
meaning. Target customer stores the advertisement and message in memory so can be accessed
when needed.
Process of Perception
There is a linear flow from exposure to memory. But, these processes occur virtually
simultaneously and are clearly interactive. It implies that our memory influences the information
we are exposed to, attend to, and the interpretation we assign. At the same time, memory itself is
being shaped by the information it is receiving. Much of the interpreted information will not be
available to active memory when the individual needs to make a purchase decision.
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The perceptual process consists of many

sub processes. We can understand this by taking a
note of the input-throughput output approach.
This approach is based on the fact that there is an
input, which when processed gives outputs.
Perceptual Inputs: The first process in the
perceptual processes the presence of stimuli
like people, objects, events, information etc.
Perceptual mechanism: We will discuss the
mechanism of perception in the next section.
Perceptual outputs: The perceptual outputs
will be the behaviour or actions of the
individuals, i.e., the resultant opinions, feelings
attitudes etc.
Dynamics of Perception
Physical stimuli from the outside environment, and internal stimuli based on expectations,
motives, and learning is based on previous experiences. Because each person is a unique
individual, with unique experiences, needs, wants, desires, and expectations, it follows that each
individuals perceptions are also unique.
There are three aspects to perceptionsselection, organization, and interpretation of
stimuli. Individuals are very selective as to which stimuli they recognize. They subconsciously
organize the stimuli they do recognize according to widely held psychological principles. And they
interpret such stimuli (i.e., they give meaning to them) subjectively in accordance with their needs,
expectations, and experiences.
(1) Perceptual Selection
We as consumers subconsciously exercise selectivity as to the stimuli they perceive. Which stimuli
get selected depends on two major factors in addition to the nature of the stimulus itself:
a. Consumers previous experience as it affects their expectations.
b. Their motives at the time (their needs, desires, interests, and so on).
Each of these factors can serve to increase or decrease the probability that a stimulus will be
perceived.
The Nature of the Stimulus: Marketing stimulus contains an enormous number of variables.
Examples include: Nature of the product, Its physical attributes, The package design, The brand
name, The advertisements and commercials, The position of a print ad or commercial, The editorial
environment, Advertisers use extreme attention-getting devices to get maximum contrast and
penetrate the consumers perceptual screen, Advertisers use colour contrasts, size, etc., to create
stopping power and gain attention.
Expectations: People see what they expect to see. What they expect to see is usually based on
familiarity, previous experience, or preconditioned set expectations. Stimuli that conflict sharply
with expectations often receive more attention than those that conform to expectations.
Motives: People tend to perceive things they need or want. The stronger the need, the greater the
tendency to ignore unrelated stimuli in the environment. An individuals perceptual process attunes
itself more closely to those elements of the environment that are important to that person.
Marketing managers recognize the efficiency of targeting their products to the perceived needs of
consumers.
Selective Perception: The consumers selection of stimuli (selective perception) from the
environment is based on the interaction of expectations and motives with the stimulus itself.
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Selective exposureconsumers actively seek out messages they find pleasant or with
which they are sympathetic.
Selective attention Consumers actively avoid painful or threatening messages.
Consumers have a heightened awareness of the stimuli that meet their needs or interests.
People also vary in terms of the kind of information in which they are interested and the
form of message and type of medium they prefer.
Perceptual defenceThreatening or otherwise damaging stimuli are less likely to be
perceived than are neutral stimuli. Individuals unconsciously may distort information that is
not consistent with their needs, values, and beliefs.
Perceptual blocking consumers screen out enormous amounts of advertising by simply
tuning out.- blocking such stimuli from conscious awareness.
Average supermarket shopper is exposed to 17,000 products in a shopping visit lasting 30
minutes-60% of purchases are unplanned. Exposed to 1,500 advertisements per day. Cant
be expected to be aware of all these inputs, and certainly will not retain many.
(2) Perceptual Organisation

People do not experience the numerous stimuli they select from the environment as separate and
discrete sensations. People tend to organize stimuli into groups and perceive them as unified
wholes. Gestalt psychology (Gestalt, in German, means pattern or configuration) is the name of the
school of psychology that first developed the basic principles of perceptual organization. Three of
the most basic principles of perceptual organization are figure and ground, grouping, and closure.
Gestalt theory is particularly useful in making decisions related to advertising and packaging.
Figure and Ground: Stimuli that contrast with their environment are more likely to be noticed.
The simplest example is the contrast between a figure and the ground on which it is placed. The
figure is usually perceived clearly. The figure is more clearly perceived because it appears to be
dominantthe ground appears to be subordinate and less important. Advertisers have to plan their
advertisements carefully to make sure that the stimulus they want noted is seen as figure and not
as ground. Marketers sometimes run advertisements that confuse the consumer because there is
no clear indication of which is figure and which is ground.
Grouping: Individuals tend to group stimuli as groups or chunks of information, rather than as
discrete bits of information. Grouping can be used advantageously by marketers to imply certain
desired meanings in connection with their products. E.g. postal coding, telephone number.
Closure: Individuals have a need for closure. As a result, people organize a perception so they see
a complete picture. If the pattern of stimuli to which they are exposed is incomplete, they tend to
perceive it as completethey fill in the missing pieces. The very act of completion serves to involve
the consumer more deeply in the message.
(3) Perceptual Interpretation
The interpretation of stimuli is uniquely individual because it is based on what individuals expect to
see in light of their previous experience. Stimuli are often highly ambiguous. When stimuli are
highly ambiguous, individuals usually interpret them in such a way that they serve to fulfil personal
needs, wishes, and interests. How close a persons interpretations are to reality depends on the
clarity of the stimulus, the past experiences of the perceiver, and his or her motives and interests
at the time of perception.
Perceptual Distortion: With respect to perceptual distortion, individuals are subject to a number
of influences that tend to distort their perceptions.
Physical Appearancespeople tend to attribute the qualities they associate with certain
people to others who may resemble them. Attractive models are more persuasive and have
a more positive influence on consumer attitudes and behaviour than do average-looking
models.
Stereotypesindividuals tend to carry pictures in their minds of the meaning of various
kinds of stimuli.
First Impressionsthese tend to be lasting but formed while the perceiver does not know
which stimuli are relevant, important, or predictive.
28
Jumping to Conclusionsmany people tend to jump to conclusions before examining all

the relevant evidencehearing the beginning of an ad and drawing the incorrect conclusion.
Halo Effectdescribes situations where the evaluation of a single object or person on a
multitude of dimensions is based on the evaluation of just one or a few dimensions. 1)
Consumers often evaluate an entire product line on the basis of the one product within the
product line. 2) Licensing also is based on the halo effectassociating products with a wellknown celebrity or designer name.
III. ATTITUDE
What are Attitudes?
People have attitude toward almost everything like religion, politics, clothes music and food.
Attitude put them into a frame of mind of liking or disliking an object moving towards or away from
it. When someone verbalizes an attitude, it is called an opinion, and you hear words such as like,
dislike, really dont care. In your next conversation with a friend or family member, notice how
many times these words, or similar words, is used. They indicate that an attitude is being
expressed. Attitude leads people behave in a fairly consistent way towards similar object. A
persons attitude settles into consistent patterns. To change a single attitude may require major
adjustment in other attitudes. As attitudes are mental positions, they cannot be observed directly.
Marketers must infer attitudes through research methods that require consumers to express
opinions.
Defining Attitude
To Philip Kotler An attitude is a person enduring favorable or unfavorable evaluations,
emotional feelings and action tendencies toward some object or idea.
To Schiffman and Kanuk A learned predisposition to behave in a consistently favourable or
unfavourable way with respect to a given object (1996).
To Bem Attitudes are likes and dislikes, 1979
The main characteristics of attitudes are indicated by the key words in the definition: learned,
predisposition, behave. Remember that attitudes occur within a situation and that the situation can,
and will, influence the relationship between attitude and behaviour. A consumer can have different
attitudes towards the same product depending on the situation. The main characteristics of
attitudes are
Attitudes are learned from personal experience, information provided by others, and market
controlled sources, in particular exposure to mass media, advertising, internet and various
form of direct marketing.
Attitudes are predisposition.
A predisposition is an inclination or tendency towards
something; attitudes have motivational qualities, they might appeal a consumer towards a
particular behaviour or repeal the consumer away from a particular behaviour.
Attitudes have a relationship with behaviour. For marketers, the behaviour of primary
interest is product purchase. Remember, however, that we are not suggesting or assuming a
causal relationship.
Attitudes are relatively consistent with the behaviour they reflect. However, this does not
necessarily mean that they are permanent; attitudes can change.
Attitudes are directed towards an object or situation; it means events or circumstances
that, at a particular point of time, influence the relationship between an attitude and
behaviour. A specific situation can cause consumers to behave in ways that are similarly
inconsistent with their attitudes. So, while measuring attitudes it is important to consider the
situation in which the behaviour takes place. The term object includes specific consumption
or marketing-related concepts, such as product, product category, brand, service,
possessions, product use, advertisement, price, medium, or retailer.
PRODUCT
SITUATION
ATTITUDE
Monaco
Party going on and ordered snacks have I need to serve an instant
not arrived
substitute fro snacks
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Vicks Action 500
Suffering from blocked nose and

headaches
Maxima Watches
Watch slipped from hand and fell into

water
Complain
Mothers worried about children not taking

balanced food.
You need to take a double

action table to get immediate
relief
There is nothing to worry
since its an economical water
proof wrist watch
There is the need for giving
children a complete planned
food.
You need to use an easy to
use, very effective detergent
power.
Ariel micro shine
Husband has to wash a pile of dirty

clothes, when his wife is away from
home.
Few example of how situation can influence attitudes
Factors Affecting Relationship between Attitude, Belief and Opinion
Attitude is normally thought of as resulting from a combination of beliefs and values and
opinion. Terms such as opinion and beliefs are often used quite closely with attitudes. These beliefs
may be based on real knowledge, opinion, or faith. They may or may not carry an emotional
charge. Marketers are interested in the beliefs that people have about specific products and
services. Beliefs reinforce product and brand images. People act on beliefs.
Attitude tends to be generalized predisposition to react in some way towards object or
concepts, whereas.
Opinion tends to be focused on more specific aspects of the object or concept.
A Belief is a descriptive thought that a person holds about something. Simply beliefs are
the body of knowledge we hold about the world. A customer may believe that Complain is
good for his baby as it has been presented as a fact endorsed by the health and nutrition
specialist in the ad clipping.
Value is often an attribute possessed by an individual and considered to be desirable. we
can see that values involve an individuals judgment on what is right, good, desirable and
worthwhile.
The difference between attitude, opinions, beliefs and values exist only on conceptual basis. The
relationship between them is a complex one. It is usually said people have thousands of beliefs and
opinions about the world, hundreds of attitudes although probably fever than fifty values.
Brand-value; Dove- the moisturizing effect; Surf Ultra- the stain busting power; Le Sancy
the longevity; Bajaj- Longevity and durability; T-Series cassettes- economical.
a) Lack of Involvement: If the involvement of an individual in a particular issue is low, then the
relationship between attitude and behavior is also low for example the involvement in the
purchase of an electric bulb for an individual may be low. For him buying a bulb is not of great
importance. In such a situation, he will not be enthusiastic to get more information on bulb
hence will not have any beliefs about any specific nature. Hence a particular brand does not
really matter him and will accept a Philips, or HMT or Surya or Bajaj.
b) Changing Market Conditions: One might have a very positive attitude towards a brand. He
may have continued buying it for a long time. But if the prices are suddenly increased beyond
his acceptable level or if the brand vanishes from the market then he will have no option but to
go in for a different brand. Hence attitude will have no link with the behavior.
c) Lack of Direct Product Experience: When consumers have direct product experience there
attitudes are more likely to be related to subsequent behavior lack of product experience may
result in weakly held attitudes that are not related to behavior
d) Lack of Purchase Feasibility: An individual may be highly enthusiastic about cars. He may
collect as much information on cars as possible. He may get totally attracted to the new ad of
Toyota 'Corolla'. After seeing the ad and getting more information about 'Corolla', he may form
strong positive beliefs about the brand. But such a belief may not lead to a buy basically
30
because the person may not have the buying capacity. Thus a positive attitude may not
necessarily lead to the act of purchase.
e) Lack of Relation between Values & Beliefs: an individual may well be aware of the risk of
smoking. The values an individual has towards smoking can be negative yet if he believes that
he does not want to live longer than there will be no association between values and beliefs.
Such an individual may continue smoking knowing well that it is injurious to health.
f) Poor Attitude Accessibility: Consumers retain brand beliefs in memory as schema
representing their associations with the brand. For these beliefs to affect brand evaluations,
they must be accessible from memory. Lack of a relationship between attitudes and behaviour
maybe due to the fact that some attitudes are so weakly held that they are not accessible. If
consumers have strong held attitudes, they spontaneously retrieve them when they encounter
the object. For example if a consumer has a strong positive attitude towards MAGGI noodles,
the consumer could spontaneously retrieve the MAGGI schema by the mere mention of 2
minutes noodles.
Structural Models of Attitude

Why do we study different models of attitude? Models assist us in describing attitudes.
Once we have a framework to use in describing attitudes, we are in a better position, as marketers,
to explain, and hopefully predict the attitudes of our target consumer, and ultimately their purchase
behaviour.
Why are there so many different models, all essentially describing attitudes? Obviously
each theorist or model creator feels that their model is the best and provides answers to all the
questions. Each model takes a different view of the number of component parts of an attitude, of
how they are arranged, and how the component parts interrelate. No one model provides all the
answers to our question What is an attitude and how is it formed. At best, models can just help.
[A] Tri-components Attitudes Model
According to the Tri-component attitude model attitudes consist of three major component which
portrays attitudes as having three component parts: cognitive (I think/know/believe), affective (I
feel), and conative (I do/intend to do).
The Cognitive Component: the first component
of the Tri-component model consists of a persons
cognition i.e. knowledge and perception that are
acquired by a combination of direct experiences
with the attitude object and related information
from the various sources this knowledge and
resulting perceptions commonly take the form of
beliefs that is the consumer beliefs that the
attitude object posses various attributes and the
specific behaviour will lead to specific outcome.
The Affective Component: a consumers
emotions or feelings about a particular product or
brand constitute the affective component of an
attitude. These emotions and feelings are
frequently treated by consumer researchers as
primary evaluative in nature, i.e. they capture an
individuals direct or global assortment of the
attitude object to the extent of favorable or unfavorable. Affect laden experiences also manifest
themselves as emotionally charged states e.g. happiness, sadness, shame, disgust, anger, distress,
guilt or surprise.
The Conative Component: conation is concerned with the likelihood or tendency that an
individual will undertake a specific action or behave in a particular way with regard to the attitude
object. In marketing and consumer research, the conative component is frequently treated as an
experience of the consumers intention to buy.
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[B] Multi-attribute Models

These models portrays consumers attribute with respect to an attitude object as a function of
consumer perception and assessment of the key attributes or beliefs held with respect to particular
attitude object.
(1)The Attitude towards Object Model: is especially suitable for measuring attitudes towards a
product category or specific brands. To this model, the consumer attitude towards a product or specific
brands of a product is a function of the presence and evaluation of certain product-specific beliefs
and/or attitudes. In other words consumer generally have favourable attitudes towards those brands
that they believe have an adequate level of attributes that they evaluate as positive and they have
unfavourable attitudes towards those brands they feel do not have and adequate level of desired
attributes or have too many negative or undesired attributes. For instance, you may like Maruti Swift
(2) The Attitude towards Behaviour Model: is designed to capture the individuals attitude
towards behaviour having or action with respect to an object rather than the attitude towards it
self. The appeal of the attitude-towards-behaviour model is that it seems to correspond some what
more closely to actual behaviour than does the attitude towards object model. So taking on from
same example of Maruti Swift, we may say you are not ready to buy/drive one because you believe
that you are too old to do so.
(3) Theory of Reasoned Action Model: integration of attitude components into a structure that
is designed to lead to both tri-component attitude models. The theory of reasoned action model
incorporates a cognitive component, an affective component and a conative component however
these are arranged in a pattern different from that of the tri-component model.
Beliefs that the behaviour leads to certain outcomes

Attitudes towards the behaviour
Evaluation of the outcomes
Intentions
Beh
Beliefs that specific references think I should or shouldnt perform the behaviour
Subjective norms
Motivation to comply with the specific references
In accordance with this expanded model to understand intention, we also need to measure
the subjective norms to act. A subjective norm can be measured directly by assessing a consumers
feeling as to what relevant others (family, friend, roommates) would think of the action being
considered that is would they look favorably on the anticipated action?
Consumer researchers can behind the subjective norms to the underlying factor that are
likely to produce it. They accomplish this by assessing the normative beliefs that the individuals
attribute to relevant others as well as individual motivation to comply with each of the relevant
others.
(4) Theory of Trying to Consumer Model: this theory is designed to account for the many cases
where the action or outcome in not certain but instead reflects the consumers attempts to
32
consume or purchase. In such cases there are often personal and environmental impediments that
might prevent the desire action or outcome from occurring. That situation where consumers dont
try to consume i.e. failing to try to consume, consumer appears to
Fail to see or are too ignorant of their option and
Make a conscious effort not to consume i.e. they might seek to self sacrifice or defer
gratification some future time.
(5) Attitude towards the Advertisement Model: in an effort to understand the impact of
advertising or consumer attitudes towards particular products or brands considerable attention has
been paid to developing what has been reinforced to as attitude the advertisement models.
Exposure to an advertisement
Judgment about Ad (Cognition)
Feeling from the Ad (Affect)
Beliefs about the Brand
Attitude towards the Ad
Attitude towards the brand
The consumer forms various feelings affection and judgment (Cognition) as the result of exposure
to an advertisement. These feelings and judgments in turn affect the consumers attitude towards.
The advertisement and beliefs about the brand acquired from exposure to the advertisement.
Finally the consumers attitude towards the advertisement and beliefs about the brand influences
his attitude toward the brand.
Attitude Formation
How do people, especially young people form their general attitude towards thing?
The answer to such question is of vital importance for marketers, without knowing how attitudes
are formed; they are unable to understand or to influence consumer attitudes or behaviour.
A How Attitudes are Learned
When we speak of the information of an attitude, we refer to the shift from having no attitude
towards a given object to having some attitude towards it. The shift from on attitude to an attitude
is a result of learning. Attitudes are generally formed through:
Repeated exposure to novel social objects,
Classical conditioning,
Operant conditioning and
Exposure to live and symbolic models.
Sometimes attitudes follow the purchase new purchase and consumption of a product e.g. a
consumer may purchase a brand-name product without having a prior attitude towards it because
it is the only products of its kind available.
Consumers also make trial purchase of new brands from product categories in which they
have little personal involvement. If they find it the purchased brand to be satisfactory then are
likely to develop a favorable attitude towards it.
B. Sources of Influence on Attitude Formation
The formation of consumer attitude is strongly influenced by personal experiences, the influence,
the influence of family and friends, direct marketing, mass media and the internet.
33
Personal experience:- the marketers objective is to get consumers to try and evaluate the product.
If a product proves to be their likely then it is likely that consumers will form a positive attitude and
be more likely to purchase product.
Friends: - as we come in contact with others especially family, close friends we form attitudes that
influence our lives. The family is an extremely important source of influence on the formation of
attitudes, for it is the family that provides us with many of our basic values and wide range of less
central beliefs.
Direct-marketing programs: is widely used by marketers to attract small consumers niches with
products and services that fit their interests and life style niche marketing is sometimes called
micromarketing. Marketers very carefully target customers on the basis of their demographic
psychographic or geo-demographic profiles with highly personalized product offerings (e.g. watches
for left hand people) and message that show they understanding their special needs and desires.
Mass-media: these mass media communication provide important sources of information that
influences the formation of consumer attitudes. Other research indicates that for consumers who
lack direct experiences with a product, exposure to an emotionally appealing advertising message
is more likely to create an attitude towards the product.
Internet: is a vital source of getting information about the product. Todays savvy consumers spent
more time in browsing the web for getting relevant consumption related information, thus it
influences their way to form attitude.
C. Personality Factors
Personality plays a crucial role in attitude formation e.g. individuals with a high need for cognition
(i.e. those who crave information and enjoy thinking) are likely to form positive attitude in
response to advertisement that features an attractive model or well known celebrity. In a similar
fashion, attitudes towards new products and new consumption situation are strongly influenced by
specific personality characteristics of consumers.
Attitude Change Strategies

All marketers are concerned with maintaining positive attitudes in their current consumers, that
they do through; changing the neutral attitudes of ambivalent (two mind) consumers to positive
attitudes, hoping to increase market share; and, if necessary, changing negative attitudes to at
least neutral ones.
Then the question before them Can attitudes be changed? If you have ever tried to change
a bad habit, or clean up your attitude, you know that it is difficult but not impossible to
change attitudes. Marketers have found that weakly held attitudes are easier to change than
strongly held attitudes. Consumers tend to develop strongly held attitudes in areas they consider
being of great personal importance, that is, of high involvement. Strongly held attitudes can be
either positive or negative, with the product falling in the evoked or the inept set. In areas of
limited or questionable importance, consumers tend to be ambivalent or neutral, or have weakly
held attitudes that are susceptible to change. These products would fall in the inert set. We
identify six categories of attitude change strategies:
[1] Changing the Basic Motivational Function. These strategies are based on the theory that
attitudes serve four basic functions: utilitarian, ego-defensive, and value-expressive and knowledge.
By changing the basic motivational function, the attitude towards the product can be changed.
The Utilitarian Function: a consumer develops a brand attitude because of its utility. So
marketers try to change consumer attitudes in favour of their product or brand by highlighting
its utilitarian purpose which the competitor consumers may not have considered. E.g. Jyoti
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Laboratries have positioned Ujala as Neel jo Neela nahi, neel which is not blue and also the cost
benefit only Rs.7/- is given as utilitarian benefits.
The Ego-Defensive Function: most people want to protect their self image from inner feeling of
doubt. They want to replace their uncertainty with a sense of security and personal confidence.
Advertisements for coscemetics and personal care products, by acknowledging this need,
increase both their relevance to consumer and the likelihood of a favourable attitude change by
offering reassurance to the consumers self concept. Dove shop speaks about the skins dryness
which is taken care by the moisturing contents in the dove shop. Boroplus- Rukhapan se
aajadi, Fair & Lovely Safalta ka chota rahasys.
The Value Expressive Function: A consumer develops an attitude based on his general value, life
style and outlook. If the target consumers hold a positive attitude towards being fashionable,
then they will have a positive attitude towards high fashion clothes e.g. Van Hussen, Louis
Phillip etc. the ad for Yamaha RXG motor cycle is targeted at young people who are out going
and prefer a powerful bike the ad claims man machine and nature in perfect harmony,
Breathtaking power, unbeatable performance Bajaj Pulsar feel the black
The Knowledge Function: individuals generally have a strong need to know and understand the
people and things will that they come in contact. The consumers need to know is important to
marketers concerned with product positioning. Indeed many product and brand positioning are
attempted to satisfy the need to know and to improve consumers attitude towards the brand by
emphasizing its advantageous over competitive brands. E.g. a message for an advanced design
tooth brush like Oral-B, Colgate-Flexi might point out how it is superior to other toothbrush.
Combining Several Function: since different consumers may have developed positive or
negative attitudes towards the same product or services. Firms could use a functional frame
work for examining the consumer attitude. E.g. Asian Paints have highlighted the usage of their
paints to harmonise the home coming of the son on the festival day, when the house has also
been colourfully repainted with Asian Paints.
[2] Associating the Product with a Special Group, Event or Cause. Attitudes can be altered by
indicating to consumers the products relationship to particular groups, events or causes. Concern for
the environment has been one cause used recently. E.g Titan Cup is associated with cricket. Red &
White Bravery award, CRY greeting cards is associated with a cause, contribution goes to the UNICEF
[3] Relating to Conflicting Attitudes. Consumers like harmony they do not like conflict. If they
can be shown that their attitude towards a product is in conflict with another attitude, they may be
induced to change one of the attitudes. However Marico Industries created a heart slopping
commercial for its Safola cooking oil to resolve the conflicting attitude that safola oil though healthy oil
is not particular tasty. Safolas product benefits there are many things in you husbands life that you
cant control. Saffola: its your life insurance
[4] Altering Components in the Multi-Attribute Model. In these strategies, marketers attempt to
change the evaluation of attributes by upgrading or downgrading significant attributes; change brand
beliefs by introducing new information; and by adding an attribute, or by changing the overall brand
rating.
Changing relative evaluation of attributes: Moov- a balm to relieve pain in the back (spinal cord
area) and Iodex to relieve pain due to any inflammation or swelling like sprain. Borolin is
relieving pain due to burning of any part.
Changing brand belief: P&Gs Ariel microshine detergent claims this detergent is a tough
cleaner, powerful stain remover easy to use, unlike to other detergents which only whiten the
clothes.
Adding on attributes: Complain- a complete health drink for growing childen.
Changing the overall brand rating: Videocon- an Indian multinational company; westar: dual
time watches, the world on your wrist.
[5] Changing Beliefs about Competing Brands. In this strategy, we directly compare our product
with the competition in an attempt to change consumer beliefs about both products, for example,
BigBazar- isse sasta aur kahan.
[6] The Elaboration Likelihood Model. This model suggests that consumer attitudes can be
changed by either central or peripheral routes to persuasion. In the central route, attitude change
occurs because the consumer seeks and evaluates additional information about the product. In this
case, motivation levels are high and the consumer is willing to invest the time and effort to gather and
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evaluate the information, indicating a high level of involvement. Multi-attribute models are based on
the central route to persuasion as attitudes are believed to be formed on the basis of important
product attributes/features and brand beliefs. In the peripheral route, consumers are either unwilling
or unable to seek additional product information. Involvement is low, so marketers must offer
secondary inducements such as price reductions or premiums in an attempt to induce attitude change.
More attention is paid in advertisement design to the credibility of the message source (spokesperson
or endorser) and his or her attractiveness.
Marketers must realise that attitudes change not only in response to their efforts but also in
response to the introduction of new or improved products by themselves or the competition; the
addition of new consumer experiences, either direct or indirect; the marketing efforts of the
competition; and how the product performs after purchase.
Conclusion: Attitude is the buzz word among marketers today. Marketers are emphasizing in a trend
which says Attitude is about believing yourself. And they are using this trend to bring their brands
within the realm of individual choice. Marketers are engaged in building brand image and personality
which can be offered to the attitudinal segment because marketers have realized that attitude sells.
Thus a good brand attitude will permeates across all product activity and then emerge the winner at
the market place.
IV. LEARNING
I. The Elements of Consumer Learning

Consumers learn from past experience, and their future behavior is conditioned by such
learning. In fact, learning can be defined as a change in behavior occurring as a result of past
experience. As consumers gain experience in purchasing and consuming products, they learn not
only what brands they like, but also features they like most in particular brands. They then adjust
their future behavior based on past experience
Learning as a relatively enduring change in behavior due to experience
To Long Schiffiman and Leslie Konuk Learning is the process by which individuals acquire the
purchase and consumption knowledge and experience that they apply to future related behavior.
The element include in most learning theories are drive, cues, response, and reinforcement.
Because everyday an individual receives a variety of stimulus. When a particular stimulus becomes
associated with a particular response, we conclude that learning has occurred.
Drive: Drive is said to be strong stimuli that forces action. The drive arouses in an individual an
urge to respond to the stimuli and thus forms the basis of motivation. For example, seeing a
product like a microwave oven at a friends place and watching advertisements may create a drive
to know more about the oven. This in turn motivates the individual to visit a retailer and have more
information about the oven and thus leads to learning.
Cues: A cue is any object existing in the environment, as perceived by the individual. Cues give
direction to motives. Cues increase the possibility of getting specific response. In the marketplace,
price, styling, packaging, advertising, and store displays all serve as cues to help consumers fulfill
their needs.
Response: A stimulus leads to response. It is the reaction of an individual to a stimulus. Such
response may be in the physical form or may be in terms of phenomena such as attitudes,
perceptions etc. Response does not merely depend on drive, motive or cue. It also depends on past
experience of consumers and their association of the cue with something different than the target.
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Reinforcement: It is a very basic condition of learning. Without it, we cannot observe any
measurable modification of behavior. Reinforcement refers to those environmental events, which
increase the likelihood of specific response occurring in the future as a result of particular cue or
stimuli.
Retention: The stability of learned behavior maintained by the individual over a period of time is
called Retention. Under repeated condition of positive reinforcement, there is a tendency for the
conditioned response to continue for a long period of time. For example, a consumer who is
absolutely delighted by the use of a product will continue to have a positive feeling about the
product for a long time.
II Behavioural Learning Theories

There are two schools of thought in understanding the process of consumer learning: the
behaviorist and the cognitive. The behaviorist school is concerned with observing changes in an
individuals responses as a result of exposure to stimuli. Whereas the cognitive school views
learning as problem solving and focuses on changes in customers psychological set (the consumers
attitudes and desired benefits) as a result of learning. In this respect, the cognitive school more
closely describes learning within a framework of decision-making.
[A] Behavioral Learning Theories
Behavioral learning theories are sometimes referred to as stimulus-response theories
because they are based on the premise that observable response to specific external stimuli signal
that learning has taken place.
1. Classical Conditioning
1. Early classical conditioning theorists regarded all organisms as passive recipients.
2. Conditioning involved building automatic responses to stimuli. Ivan Pavlov was the first to
describe conditioning and to propose it as a general model of how learning occurs.
3. For Pavlov, conditioned learning results when a stimulus that is paired with another stimulus
elicits a known response and serves to produce the same response when used alone.
4. He used dogs to demonstrate his theories. The dogs were hungry and highly motivated to
eat. Pavlov sounded a bell and then immediately applied a meat paste to the dogs tongues,
which caused them to salivate.
5. After a sufficient number of repetitions of the bell sound, followed almost immediately by
the food, the bell alone caused the dogs to salivate.
Pavlovian Model of Classical Conditioning
Unconditioned Stimulus (Meat Paste)

Unconditioned Response (Salivation)
Conditioned Stimulus ()
AFTER REPEATED PAIRING

Conditioned Stimulus ()
Conditioned Response (Salivation)
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In a consumer behavior context, an unconditioned stimulus might consist of a well-known brand

symbol (e.g., the Microsoft windows icon) that implies technological superiority and trouble-free
operation (the unconditioned response). Conditioned stimuli might consist of new products bearing
well-known symbols.
Cognitive associative learning: contemporary behavioral scientist view classical conditioning as
the learning of association of events that allows the organism to anticipate and represent its
environment. To this view the relationship (or contiguity) influenced the dogs expectations, which
in turn influenced their behavior (salivation). Classical conditioning, then, rather than being a
reflexive action, is seen as cognitive associative learning not the acquisition of new reflexes, but
the acquisition of new knowledge about the world. To some researchers, optimal conditioning that
is, the creation of a strong association between the conditional stimulus (CS) and the unconditional
stimulus (US) requires
Forward conditioning (i.e. the CS should precede US)
Repeated pairing of the CS and US
A CS and US that logically belong together
A CS that novel and unfamiliar
A US that is biologically or symbolically salient.
This model is known as Neo-Pavlovian Conditioning, under this theory consumer can be viewed
as information seeker who uses logical and perceptual relations among events, along with his or
her own pre-conceptions to form a sophisticated representation of the world. Conditioning is the
learning that results form exposure to relationship among events in the environment; such
exposure creates expectations as to the structure of the environment.
Strategic application of classical conditioning:
Repetition increases the strength of the association between a conditioned stimulus and an
unconditioned stimulus and slows the process of forgetting;
Advertising wearout( repetition beyond what is necessary) can be moderated by varying the
advertising message.
Some marketer scholars believe that just three exposures to an advertisement are needed:
one to make consumers aware of the product, a second to show consumers the relevance of
the product and third to remind them of its benefits. This is known as three-hit-theory.
Others think that 11 to 12 repetition to increase the likelihood that consumers will actually
receive the three exposures basis.
The higher level of competitive ads, the greater the likelihood that interferences will occur;
causing consumers to forget previous learning that resulted from repetition.
Stimulus generalization explains why some imitative me-too products succeed in the
marketplace: consumers confuse them with original product they have seen advertised. It
also explains why manufacturers of private level brands try to make their packaging closely
resemble the national leaders.
The principle of stimulus generalization is applied by marketers to product line, form and
category extensions. Family branding, licensing and franchising
Stimulus discrimination is the opposite of stimulus generalization and results in the
selection of a specific stimulus from among similar stimuli. The consumers ability to
discriminate among similar stimuli is the basis of positioning and product differentiation.
Classical conditioning and consumer behavior: the principles of classical conditioning provide
the theoretical underpinnings for many marketing applications. Repetition, stimulus generalization
and stimulus discrimination are the major applied concepts that help to explain consumer behavior
in the market place.
2. Instrumental Conditioning
1. Instrumental conditioning theory believes that learning occurs through a trial-and-error
process, with habits formed as a result of rewards received for certain response or
behaviours.
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2. Instrumental conditioning theory is more helpful in explaining complex, goal directed

behavior. This model of learning applies to many situations in which consumers learn about
products, services and retail stores.
3. To American psychologist B.F. Skinner, most individual learning occurs in a controlled
environment in which individuals are rewarded for choosing and appropriate behavior. In
consumer behavior terms, Instrumental conditioning suggests that consumer learns by
means of trial-and-error process in which some purchase behavior results in more favorable
outcomes (rewards) than other purchase behaviors. A favorable experience is instrumental
in teaching the individual to repeat a specific behavior.
4. Like Pavlov, Skinner developed his model of learning by working with animals. Small
animals, such as rats and pigeons, were placed in his skinner box; if they made appropriate
movements, they receive food. Skinners and his many adherents have done amazing things
with this simple learning model, including teaching pigeons to play ping-pong and even to
dance.
5. In a marketing context, the consumer who tries several brands and styles of jeans before
finding a style that fits her figure (positive reinforcement) has engaged in instrumental
learning. Presumably, the brand that fits best is the one she will continue to buy.
Stimulus Situation
(Need good looking jeans)
Try Brand A
Unrewarded: Legs too loose
Try Brand B
Unrewarded: Tight in seat
Try Brand C
Unrewarded: Baggy in seat
Try Brand D
Reward: Perfect fit
Reinforcement of behavior: skinner distinguished two types of reinforcement that influence the
likelihood that a response will be repeated.
1. The first type the positive reinforcement consists of events that strengthen the likelihood of
a specific response. Using a shampoo your hair feeling silky and clean is likely to result in a
repeat purchase of the shampoo.
2. Negative reinforcement is an unpleasant or negative outcome that also serves to encourage
a specific behavior. An advertisement that shows a model with wrinkled skin is designed to
encourage consumers to buy and use the advertised skin cream; fear appeals. Negative
reinforcement should not be confused with punishment, which is designed to discourage
behavior
Extinction and Forgetting: when a learned response is no longer reinforced, it diminishes to the
point of extinction, which is the point at which the link between the stimulus and the expected
reward is eliminated. When behavior is no longer reinforced, it is unlearned. There is a difference,
however between extinction and forgetting.
Forgetting is often related to the passage of time; this is known as the process of decay
Marketers can overcome forgetting through repetition and can combat extinction through
the deliberate enhancement of consumer satisfaction.
Strategic application of instrumental conditioning Marketers effectively utilize the concepts of
instrumental learning when they provide positive reinforcement by assuring customer satisfaction
with the product, the service and the total buying experiences.
Relationship marketing: developing a close personalized relationship with customers is
another form of non productive reinforcement
Reinforcement schedules: marketers have found that product quality must be
consistently high and provide satisfaction to the customer with each use for desired
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consumer behavior to continue. More over some non product rewards do have to be offered
each time the transaction takes place. Marketers have identified three types of
reinforcement schedules
Fixed ratio systematic basis, every third time
Variable ratio random basis, every third or tenth transaction
Continuous free after dinner drink
Shaping: reinforcement performed before the desired consumer behavior actually takes
place is called shaping. Shaping increases the probabilities that certain desired consumer
behavior will occur. E.g. test-drive, inviting the customer, providing small gifts and larger
gifts,
Customer satisfaction (Reinforcement): the objective of all marketing efforts should be to

maximize customer satisfaction. Aside from the experience of using the product itself, consumers
can receive reinforcement from other elements in the purchase situation such as the environment
in which the transaction or services takes place, the attention and services provided by employees
and the amenities provided.
Some hotels offer reinforcement in the form of small amenities, such as chocolates on the
pillow or bottled water on the dresser
Some hotels send platters of fruit or even bottles of wine to returning guests to show their
appreciation for continued patronage.
Kelloggs provides a frequent user program by including coupons on the top of its cereal
boxes that can be accumulated and exchanged for various premiums, such as a coffee mug
or denim shirt emblazoned with the companys logo.
3. Modeling or observational learning
Learning theories have noted that a considerable amount of learning takes place in the absence of
direct reinforcement, either positive or negative, through a process of psychologists call modeling
or observational learning also called vicarious learning. Consumers often observe how others
behave in response to certain situation and the ensuring results that occur, and they imitate the
positively reinforced behavior when faced with similar situations. Modeling is the process through
which individuals learn behavior by observing the behavior of others and the consequences of such
behavior. Their role models are usually people they admire because of such traits as appearance
accomplishment, skill and even social class.
III Cognitive Learning Theory

A considerable amount of learning take place as the result of consumer thinking and problem
solving. Sudden learning also a reality. When confronted with a problem, we sometimes see the
solution instantly. Learning based on mental activity is called cognitive learning. Cognitive learning
theory holds that the kind of learning most characteristics of human being is problem solving,
which enables individuals to gain some control over their environment.
1. Information Processing
Just as a computer processes information received as input, so too does the human mind process
the information it receives as input. Information processing is related to both the consumers
cognitive ability and the complexity of the information to be processed. Consumers process product
information by attributes, brands, comparison between brands, or a combination of these factors.
Individuals also differ in terms of imagery- that is, in their ability to form mental imagesand these differences influence their ability to recall information. Individual differences in imagery
processing can be measured with tests of imagery vividness ability to evoke clear images,
processing styles preferences for and frequency of visual versus verbal processing and
daydreaming fantasy content and frequently. The more experiences a consumer has with a product
category, the greater his or her ability to make product information.
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How consumer store, retain, and retrieve information

A basic research concern of most cognitive scientist is discovering how information gets
stored in memory, how it is retained, and how it is retrieved. Because information processing
occurs in stages, it is generally believed that there is separate and sequential storehouse in
memory while information is kept temporary before further processing a sensory store, a shortterm store, and a long-term store.
Sensory store: all data come to us though our senses; however, the senses do not transmit whole
images as a camera does. Instead, each sense receives a fragmented piece of information such as
smell, color, shape and feels of flower and transmits it to the brain in parallel, where the
perceptions of a single instant are synchronized and perceived as a single image, in a single
moment of time. The image of a sensory input lasts for just a second or two in the minds sensory
store. If it is not processed it is lost immediately.
Short-term store: is known as working memory is the stage of real memory in which information
is processed and held for just a brief period. Anyone who has ever looked up a number in a
telephone book, only to forget it just before dialling, knows how briefly information lasts in shortterm storage. If information in the short-term store undergoes the process known as rehearsal i.e.
silent, mental repetition of information, it is then transferred to the long-term store. The transfer
process takes from 2 to 10 seconds. If information is not rehearsed and transferred, it is lost in
about 30 seconds of less. The amount of information that can be held in short-term storage is
limited to about four or five items.
Long-term store: retains information for relatively expanded periods of time. Although it is
possible to forget something within a few minutes after the information has reached long-term
storage, it is more common for data in long-term storage to last for days, weeks, or even years.
Rehearsal and encoding: the amount of information available for delivery from short-term
storage to long-term storage depends on the amount of rehearsal it is given. Failure to rehearse an
input, either by repeating it or by relating it to other data, can result in fading and eventual loss of
the information. Information can also be lost because of competition for attention.
The purpose of rehearsal is to hold information in short-term storage long enough for encoding
to take place. Encoding is the process by which we select a word or visual image to represent a
perceived object. Marketers, for example, help the consumer encode brands by using brand
symbols.
Kelloggs uses Tony the Tiger o its frosted flakes.
Dell computer turns the e in its logo on its side for quick name recognition
Microsoft uses a stylized window presumably on the world.
When consumer is presented with too much information called information overload. They may
encounter difficulty in encoding and storing it all. Often it is difficult for consumer to remember
product information from ads for new brands in heavily advertised categories.
Retention: information does not just sit in long-term storage waiting to be retrieved. Instead
information is constantly organized and reorganized as new links between chunks of information
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are forged. As individuals gain more knowledge about a subject, they expand their network of
relationships and sometimes their search for additional information. This process is known as
activation, which involves relating new data to old to make the material more meaningful.
Consumer memory for the name of a product may also be activated by relating it to spokesperson
used in the advertising. Sachin Tendulkar means MRF Tires. The total package of association
brought to mind when a cue is activated is called a schema.
One study demonstrated that brand imprinting message that merely establishes the
brands identity conducted before the presentation of the brands benefits facilities
consumer learning and retention of information about the brand.
Studies also showed that a brands sound symbolism a theory suggesting that the sounds
of words convey meaning and the brands linguistic- unusual spelling impacted the encoding
and retention of the brand name.
Consumers recode what they have already encoded to include larger amounts of information
called Chunking. Marketers should research the kinds and numbers of groupings (chunks) of
information that consumers can handle, when the chunks offered in an advertisement do not
match those in the consumers frame of references, information recalled may be hampered.
Information is stored in long-term memory in two ways episodically (by the order in which it
is acquired) and semantically (according to significant concepts). We may remember having
gone to movie last time because of our ability to store data episodically, and we remember
the plot, the stars, and the director because of our ability to store data semantically.
Learning theories believes that memories stored semantically are organized into frameworks
by which we integrate new data with previous experiences.
Retrieval is the process by which we recover information from long-term storage. Marketers
maintain that consumers tends to remember the products benefit rather than its attributes
suggesting that advertising message are most effective when they link the products attributes with
the benefits that consumers seek from the product.
Incongruent (or unexpected) message elements pierce consumers perceptual screens and
improve the memorability of an advertisement when these elements are relevant to the advertising
message. E.g. easy to clean, stain resistant, easy to cook in two minutes
The greater the number of competitive ads in a product category, the lower the recall of
brand claims in a specific ad. These interference effects are caused by confusion with competing
ads, and make information retrieval difficult. Ads can also act as retrieval cues for a competitive
brand.
2. Involvement Theory
Involvement theory developed from a stream of research called hemispheral lateralization, of
split brain theory. The basic premise of split brain theory is that the right and left hemisphere of the
brain specialize in the kinds of information they process
The left hemisphere is primarily responsible for cognitive activity such as reading, speaking
and attributional information processing. Individuals who are exposed to verbal information
cognitive analyze the information through left brain processing and form mental images.
The right hemisphere of the brain is concerned with nonverbal, timeliness, pictorial and
holistic information. Put another way the left side brain is rational, active and realistic; the right
side is emotional, metaphoric, impulsive and intuitive.
Involvement theory and media strategy: a pioneer consumer research theorized that
individuals passively process and store right brain (nonverbal, pictorial) information with out active
involvement, TV itself was therefore considered a low-involvement medium.
To extend this line of reasoning, cognitive (verbal) information is processed by the left side
of the brain; thus, print media (newspaper and magazines) and interactive media the internet are
considered high-involvement media.
Pictorial cues are more effective at generating recall and familiarity with the product; where
as verbal cues generate cognitive ability that encourages the consumers to evaluate the
advantages and disadvantages of the product.
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Central and peripheral routes to persuasion: the theory of central and peripheral routes to
persuasion illustrates the concepts of extensive and limited problem solving for high and low
involvement purchase situation
For high-involvement purchases, the central route to persuasion requires considered thought
and cognitive processing-is likely to be the most effective marketing strategy. For low-involvement
purchase, the peripheral route to persuasion is likely to be more effective. In this instance, because
the consumer is less motivated to exert cognitive effort, learning is more likely to occur through
repetition, the passive processing of visual cues and holistic perception.
The Elaboration Likelihood Model (ELM): The ELM suggests that a persons level of involvement
during message processing is a critical factor in determining which route to persuasion is likely to
be effective.
High-involvement --- Central route; Low---involvement --- Peripheral route
Marketing applications of involvement
The left-brain (cognitive processing) and right-brain (passive processing) paradigm seems to
have strong implications for the content, length and persuasion of print, television and
interactive advertisements.
High-involvement purchases, marketers should use argument stressing the strong, solid,
high-quality attributes of their products, thus using the central route.
Low-involvement purchases, marketers should use the peripheral route to persuasion,
focusing on the method of presentation rather than on the content of the message
To increase the customer involvement, advertisers can use sensory appeals, unusual stimuli
and celebrity endorsement to generate more attention for their messages.
Provide benefits that are important and relevant to customers, improve the product and add
benefits competition intensifies.
Focus on bonds and relationships with customers rather than just engaging in transactions.
The learning theory offers tremendous challenge to a marketer- that of guiding and
sometimes even directing human behavior. This is done by developing stimuli and cues, which will
bring to force the latent need in the customer. Attractive advertising, shelf displays, packaging, how
to use instructions, store layout, availability and sales persons are all examples of cues that
marketer develops to drive customers to the product or service. An excellent customer care
program of the marketer can help a customer have positive feelings about his or her experience.
The marketer may also develop cues to differentiate his or her product from that of the competitor.
IV Measure of Consumer Learning
1> Recognition and recall measures: tests are conducted to determine whether consumers
remember seeing an ad, the extent to which they read it or seen it can recall its content,
their resulting attitudes towards the product and the brand and their purchase intentions.
2> Cognitive response to advertising: the degree to which consumers accurately
comprehend the indented advertising message. Comprehension is a function of the message
characteristics the consumers opportunity and ability to process the information and the
consumers motivation. Copy testing
3> Attitudinal and behavioral measures of brand loyalty: Brand loyalty is the ultimate
desired outcome of consumer learning. Marketers agree that brand loyalty consists of both
attitudinal and behaviors towards a brand and that both must be measured. Attitudinal
measures are concerned with consumers overall feelings about the product and the brand
and their purchase intentions. Behavioral measures are based on observable responses to
promotional stimuli repeat purchase behavior rather than attitude towards product or
brand.
4> Brand equity: the term brand equity refers to the value inherent in a well-known brand
name. This value system from the consumers perception of the brands superiority. The
social esteem that using it provides and the customers trust and identification with the
brand.
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Cognitive Dissonance Theory Leon Festinger (New York psychologist) was the father of this concept
where we have some sort of unbalance regarding an action so we find justifications for the action. He
suggests that consumers experience discomfort, called dissonance, when they are confronted with
new information about a belief or attitude that is in conflict with the original information. This often
happens after a purchase, when it is called post-purchase dissonance. The product was purchased
with a set of expectations (beliefs). Following the actual use of the product, the consumer may find
that the initial set of expectations was not met, or the consumer may question whether they made the
right choice given the features and benefits of the products not chosen. In either case, the consumer
is faced with new information that is in conflict with the original beliefs. In an effort to reduce the
discomfort or dissonance, the original attitude may be changed. If that happens, then behaviour
purchase, use and evaluation has led to a change in attitude.
V. MOTIVATION
Motivation as a Psychological Force
Water is inexpensive from municipal agencies, yet million consumers pay 1,000 times the price of
municipal water to purchase bottled water. While heavy advertised brands such as Bislery, Aquafina
are well known, bulk water delivered to homes and offices in 5-gallon containers makes up half the
market.
To Hawkins, Best, Coney and Mookerjee Motivation is the reason for behaviour. A motive is a
construct representing an unobservable inner force that stimulation and compels a behaviour
response specific and provides specific direction to that response.
To Long Schiffiman and Leslie Konuk, Motivation is the driving force with in the individual that
impels them to action.
This driving force is produced by a state of tension, which exist as the result of a fulfillment need.
Individuals strive both consciously and subconsciously to reduce this tension through the behaviour
that they anticipate will fulfill their needs and thus relive them of the stress they feel. The specific
goals they select and the patterns of action they undertake to achieve their goals are the result of
individual thinking and learning.
Previous Learning
Unfulfilled Needs, Wants and Demands

Tension
Drive
Goal or Need Fulfill

Behaviour
Cognitive Processes
Tension Reduction
It portrays motivation as a state of need induced tension that drives the individual to
engage in behaviour that he/she believes will satisfy the need and thus reduce tension. Whether
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gratification is actually achieved depends on the course of action they takes to attain the previous
learning and experience. Therefore marketing must view motivation as a force that includes
consumption and through consumption experiences the process of consumer learning.
Need: every individual has need: some are innate, others are acquired. Innate needs are
physiological (biogenic) they include the needs for food, water, air clothing shelter and sex.
Because they are needed to sustain biological life, the biogenic needs are considered primary needs
or motives.
Acquired needs are needs that we learn in response to out culture or environment. These
may include needs for self-esteem, prestige, affection power and learning. Because acquired needs
are generally psychological i.e. psychogenic, they are considered secondary needs or motives.
Goals: our discussion of motivation in this chapter is in part concerned with the generic goals that
is the general classes or categories of goals that consumer see as a means or fulfil their needs. If a
student tells his parents that he wants to get an M.D. Degree for AMIS, he has expressed a product
specific goal. Marketers are particularly concerned with the product specific goals that are the
specifically branded products and services that consumers select goal fulfilment.
Feedback Reactions
Goal
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Goal / Attachment
and ControlFailu
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it Ifor
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goal? When, where, how long should I act?
A. The selection of goal

For any given need there are many different appropriate goals. The goals selected by individuals
depends on there personal experience, physical capacity prevailing cultural norms and values and
the goals accessibility in the physical and social environment.
An individuals personal characteristics and own perception of self also influence the specific goals
selected. Researches on personal goal orientation distinguished two types of people.
45
Persons with promotion focus are interested in their growth and developments have more
hopes and aspirations and favour the presence of positive outcomes.
Persons with a prevention focus are interested in safety and security is more concerned with
duties and obligations and favours the absence of negatives outcomes.
One study found that informing consumption related goals consumers with a prevention focus
favoured the status quo and inaction over action. Another study distinguishes between two types of
goals.
Ideas which represent hopes, wishes aspiration-relied more on feeling and affects in
evaluation advertisement.
Ought which represents duties; obligation and responsibilities- relied more heavily on the
substances and factual content of advertisement.
Goals are related to negative forms of consumption behaviour. One study found that personal goals
that focus on extrinsic benefits such as financial success, and social status and being attractive to
others are associated with higher degrees of compulsive buying than goals that stress intrinsic
benefits (such as self-acceptance, affiliation and connection with community)
B. Interdependence of needs and goals

Need are goals are interdependent neither exists without the other. However, people are often not
as aware of their needs as they are of their goals. E.g. teenagers may not consciously be aware of
his social needs but may join a number of a chat group online to meet new friends.
A college student may not consciously recognize her needs for achievement but many strive
to attain a straight a grade point average. Individuals are usually somewhat more aware of their
physiological needs that they are of their psychological needs.
C. Positive and negative motivation
Motivation can be positive or negative in direction. We may feel a driving force towards some
object or condition or a driving force away from object or condition e.g. a person may be impelled
towards a restaurant to fulfill a hunger need and away from motorcycle transportation to fulfill
safety need.
Some psychologists refer to positive drives as needs wants or desires and to negative drives
as forces of aversion. However although positive and negative motivational forces seems to differ
dramatically in terms of physical (and some times emotional) activity they are basically similar in
that both serve to initiate and sustain human behaviour.
Needs wants or desires may lead to goals that can be positive and negative. A positive goal
is one toward which behavior is directed. Thus it is often referred to as an approach object. A
negative goal is not from which behaviour is directed away and is referred to as an avoidance
object. Middle aged women with a positive goal of fitness may join a health club to workout
regularly. Her husband, who views getting fat as negative goals, joins a health club to guide her
exercise.
D. Rational Vs Emotional motive
Some consumer behaviour distinguishes between so called rational motives and emotional motives.
In marketing context, the term rationality implies that consumers select goals based on
totally objectives criteria such as size, weight, price, or miles per gallon. Emotional motives impel
the selection of goals according to personal or subjective criteria i.e. pride, fear, affection or status.
II The Dynamics of Motivation
Motivation is a highly dynamic construct that is constantly changing in reaction to life
experience. Need and goals change and grow in response to an individuals physical condition,
environment, interactions with others and experiences. As individuals attain their goals, they
develop new ones. If they do not attain their goals, they continue to strive for old goals or they
develop substitute goals. Some of the reasons why need driven human activity never ceases
include the following.
46
Many needs are never fully satisfied; they continually impel actions desired to attain or
maintain satisfaction.
As needs become satisfied, new and higher-order needs emerge that cause tension and
include activity.
People who achieve their goals are new and higher goals for themselves
A. Need is never fully satisfied

Most human needs are never fully or permanently satisfied e.g. at fairly regular intervals
throughout each day individuals experience hunger needs that must be satisfied. Most people
regularly seek companionship and approval from others to satisfy their social needs.
Marketers must be aware of the changing needs e.g. now a days everybody has become
environmentally conscious, so companies have also adopted environment friendly attitude like
using paper bags for promotional strategy.
B. Success and failure influences goals
Broadly speaking researchers have concluded that individuals who successfully achieve their goals
usually set new and higher goals for themselves i.e. they raise levels of aspiration. This may be due
to the fact that their success in reaching lower goal makes them confident of their ability to reach
higher goals conversely those who dont reach their goals sometimes lower their levels of
aspirations.
Thus good selection is often a function of success or failure e.g. a college senior who is not
accepted into medical school may try instead to a dentist or a podiatrist. The effort of success and
failure on goal selection has strategy implication for marketers. Goals should be reasonably
attainable. Advertisement should not promise more than the product delivery.
1. Substitute goals: when an individual and cannot attain a specific goal or type of goal that
he/she anticipates will satisfy certain needs, behaviour may not be as satisfactory as primary goal,
it may be sufficient to dispel uncomfortable tension. Continued deprivation of a primary goal may
result in the substitute goal assuming primary goal status.
2. Frustration: failure to achieve a goal often results in feeling of frustration. At one time or
another everyone has experienced the frustration that comes from the inability to attain a goal. The
barrier that prevents attainment of a goal may be personal to the individual (e.g. limited physical
or financial resources) or an obstacle in the physical or social environment e.g. a storm that causes
the postponement of a long awaited vacation.
3. Defence mechanisms: people who cant cope with frustration often mentally redefine their
frustration situations in order to protect their self-images and self-esteem. Defence mechanism that
people sometimes adopt to protect their egos from feelings of failure when they dont attain their
foal other defence mechanism include regression, withdrawal projection, daydreaming,
identification and repression
Marketers often considered this fact in their selection of advertising appeals and construct
advertisement s that portray a person resolving a particular frustration through the use of
advertised product.
C. Multiplicity of needs and verification of goals
A customers behaviour often fulfils more than one need. Infect it is likely that specific goals are
selected because they fulfil several needs we buy clothing for protection and for a certain degree of
modesty in addition our clothing fulfils a wide range of personal and social needs such as
acceptance or ego needs.
One cant accurately inter motives form behavior. People with difference needs may seek
fulfilment through selection of the same goal, people with the same needs may seek fulfillment
through different goal.
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D. Arousal of motive
Most of individual specific needs are dermal much of the time. The arousal of any particular set of
needs at a specific moment in time may be caused by internal stimuli found in the individual
physiological condition by emotional or cognitive process, or by stimuli in the outside environment.
1. Physical arousal: bodily needs at any one specific moment in time are based on the
individual physiological condition at that movement. A drop in blood sugar level or stomach
contractions will trigger awareness of a hunger need. Secretion of sex hormones will awaken
the sex need -> most of these physiological cues are involuntary, however they arouse
related needs that cause uncomfortable tensions until they are satisfied.
2. Emotional arousal: sometimes daydreaming results in the arousal or stimulate of latent
need people who are bored on who are frustrated in trying to achieve their goals often
engage in daydreaming (autistic thinking) in which they imagine themselves in all sorts of
desirable situations.
3. Cognitive arousal: sometimes random through can lead to a cognitive awareness of
needs. An advertisement that provides reminders of home might trigger instant yearning to
speak with ones parents. This is the basis for many long-distance telephone company
campaigns that stress the low cost of international long-distance rates.
4. Environmental arousal: the set of needs an individual experiences at a particular time are
often activated by specific cues in the environment. Without these cues the needs might
remain dormant. A most potent form of situational cue is the goal object itself. A man may
suddenly experience a need for a new car when passing a dealers display window.
Sometimes an advertisement or other environmental cues produce psychological imbalances in
viewers mind e.g. a young college student who constantly uses his cell phone may see a new slicklooking cell phone model with more features displayed in a stored window.
There are two opposing philosophies concerned with the arousal of human motives
The behaviorists school considers motivation to be a much process behaviour is seen as the
response to a stimulus and elements of conscious thoughts are ignored.
The cognitive school believes that all behaviour is directed at goal achievement.
Needs and past experience are reasoned, categorized and transferred into attitudes and believes
that act as predispositions focused on helping the individual satisfy needs and they determine the
actions that he/she takes to achieve the satisfaction.
III Types And Systems Of Needs
A. Henery Murrays basic needs
Henery Murrays basic needs: in 1983 the psychologist Henery Murry prepared a detailed list of
28 psychogenic needs. This research was probably the first systematic approach to the
understanding of non-biological human needs. Murry believed that everyone has the same basic set
of needs but that individuals differ in their priority ranking of these needs. Murrys basic needs
include many motives that are assumed to play an important role in consumer behaviour.
1. Need associated with inanimate object: acquisition, conservancy, order, retention and
construction.
2. Need that reflect the ambition, power, accomplishment and prestige, superiority,
achievement, recognition, exhibition, inviolacy, in avoidance, defendance, and
counteraction?
3. Need concerned with human power: dominance, deference, similance, autonomy,
contrarians.
4. Sadomasochistic needs: aggression, abasement.
5. Need concerned with affection between people: affiliation, rejection, nurturance, accordance
and play.
6. Needs concerned with social intercourse: cognizance, exposition.
B. Maslows need of Hierarchy
Dr Abharam Maslow, a clinical psychologist formulated a widely accepted theory of human
motivation based on the notion of a universal hierarchy of human needs. Maslows theory identifies
five basic levels of human needs which rank in order of importance from lower level biogenic needs
48
to higher level psychogenic need. The theory postulates that individuals seek to satisfy lower level
needs before higher level needs emerge and soon.
Maslow hierarchy of needs for clearly each level is depicted as mutually exclusive. According to the
theory, however there is some overlap between each level as no need is ever completely satisfied.
For this reason although all levels of need below the level that is currently dominant continues to
motivate behaviour to some extent. The prime motivator, the major driving force within the
individual is the lowest level of need that remains largely unsatisfied.
1. Physiological need: in the hierarchy of needs theory physiological needs are the first and most
basic level of human needs. These needs are required to sustain biological life, include food, water,
air shelter, and clothing, sex all these biogenic needs are the primary needs.
According to Maslow physiological needs are dominant when they are chronologically unsatisfied
for the man who is extremely and dangerously hungry no other interest exists but foods. He
dreams food, he remembers food, he thinks about foods and he emotes about food, he perceives
only food and he wants only food.
2. Safety needs: after the first level of need is satisfied, safety and security needs become the
driving force behind individuals behaviour. These needs are concerned not only with physical safety
but also include order, stability, routine, familiarity and control over one life and environment.
Health ability of health care is important concerns. Saving, accounts insurance policies, education
and vocational training are all means by which individuals satisfy the need for security.
3. Social needs: include love, affection, belonging and acceptance. People seek warm and
satisfying human relationships with other people and are motivated by love for their families.
Because of the importance of social motives in our society advertisers of many product categories
of many product category emphasizes this appeal in their advertisement.
4. Egoistic needs: these needs can take either an inward or outward orientation or both. Inward
directly ego needs reflect an individuals need for self acceptance, self esteem, success,
independence and personal satisfaction with a job well done outwardly directed ego needs include
to needs for prestige, reputation status and recognition from others.
5. Need for self actualization: this need refers to individuals desire to fulfill his or her potential
to become every thing he/she is capable of becoming. In Maslow word what a man can be, he
must be this need is expressed in different way by different people. E.g. a young man may desire
to be an Olympic star and work single mindedly for years to become the best in his sport. A
research scientific may strive to find a new drug that eradicate cancer.
Maslow noted that the self-actualization need is not necessary a creative urge but that likely to take
that firm in people with some capacity for creativity.
An evaluation of the need hierarchy and marketing applications
The hierarchy offers a highly useful framework for marketers trying to develop appropriate
advertisement appeals for their products. It is adaptable in two ways.
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It enables marketers to focus their advertisement appeals on a need level that is likely to be
shared by a large segment of the target audience.
It facilitates product positioning or repositioning.
Segmentation and promotional application: Maslows need of hierarchy is readily adaptable to
market segmentation and the development of advertisement appeals because these are consumer
goods designed to satisfy each of the need levels and because most needs are shared by large
segments of consumers.
e.g. individuals buy health foods, medicines, and low fat products to satisfy the physiological
needs. They buy insurance, preventive medical services and home security systems to satisfy and
security needs. Almost all personal care and grooming products like cosmetics, mouth wash,
shaving cream as well as most clothes are bought to satisfy the social needs. High tech products
such as elaborate sound systems and luxury products furs, big cars or expensive furniture are often
bought to fulfill ego and esteem needs. Post graduate college education, hobby related product,
exotic and physically challenged adventure trips are sold as ways of achieving self fulfillment.
Advertisers may use the need hierarchy for positioning products, i.e. deciding how the
product should be perceived by prospective consumers. The key to positioning is to find a niche
an unsatisfied need. That is not occupied by a competing product or brand. the need hierarchy is a
very versatile tool for developing positioning strategies because different appeals for the same
product can be based on different needs.
Critics to Maslows need of hierarchy level

Concepts are too general- it is said that hunger and self-esteem are considered to be
similar needs but the former is urgent and involuntary in nature where as later is a
conscious and voluntary.
This theory cant be tested empirically- this means that there is no way to measure
precisely how satisfied one need must be before the next higher need become active.
Appears both culture and time bound- the need hierarchy also appeals to be very closely
bound to our contemporary American culture, it appeals to be both culture and time
bound.
C. A Trio of Needs
Some psychologist believes in the existence of a trio of basic needs the needs for power, for
affiliation and for achievement.
(1) Power: the power need related to an individuals desire to control his/her environment. It
includes the need to control other persons and various objects. This need appears to be closely
related to the ego need, in that many individuals experience increased self-esteem when they
exercise power over objects or people.
(2) Affiliation: is a well known and well researched social motive that has for reaching influence
on consumer behaviour. The affiliation need suggests that behaviour is strongly influenced by the
desire for friendship, for acceptance for belonging people with high affiliation needs tend to socially
dependent on others. They often select goods they fill will meet with the approval of friend.
(3) Achievements: Individuals with strong need for achievements often regard personal
accomplishments as an end in itself. The achievements need is closely related to both the egoistic
need and self-actualization need. People with a high need for achievements tend to be more selfconfident, enjoy taking calculated risks actively research their environment and value feedback.
People with high achievement need prefer situation in which they can take personal responsibility
for finding solution.
IV The Measurement of Motives
How are motives identified? How they are measured? How do researchers know which motives are
responsible for certain kind of behaviour? These are diffucult questions to be answer because
50
motives are hypothetical constructs i.e. they cant be seen or touched, handled, smelled or
otherwise observed.
(A) Motivational Research
The term motivational research which should logically include all types of research onto human
motives has become a term of art used to refer to qualitative research designed to uncover the
subconscious or hidden motivation. Based on the premise that consumers are not always aware of
the reasons for their actions, motivational research attempts to discover underlying feeling,
attitudes and emotional concerning products services or brands.
(B) Qualitative research techniques used in motivational research.
These are number of qualitative research techniques that re used to delve into the consumer
unconscious or hidden motivations such as metaphor analysis, story telling, word association, and
sentence completion, thematic apperception tests drawing picture and photo sorts.
1. Metaphor analysis: for consumer research it is important to enable consumers to represent
their image in an alternative nonverbal form-through the use of say of sounds music drawing or
pictures. The use of one form of expression to describe to represent feeling about another is called
metaphor. The Zaltman Metaphor Elicitation Technique (ZMET) the first patented marketing
research tool in US relies on visual images to assess consumers deep and subconscious thoughts
about products, services and marketing strategies.
2. Story telling: this method consists of having customers tell-real stories regarding their use of
the product under study.
3. Word association and sentence completion: in this method respondents are presented with
words one at a time and asked to say the first word that comes to mind. This method is highly
useful in determining consumers association with existing brand names and those under
developments.
4. Thematic apperception tests: developed by Henery A. Murry, this test consists of showing
pictures to individual respondents and asking them to tell a story about each pictures.
5. Dowsing pictures and photos sorts: visual images are often used to study consumers
perceptions of various brands and to develop new advertise strategies.
(C) Evaluation of motivational research

It often revels unsuspected consumer motivations concerning product or brand usage, its principal
use today is in the development of new ideas for promotional campaigns, ideas that can penetrate
the consumers conscious awareness by appealing to unrecognized needs.
Motivational research also provides marketers with a basic orientation for new product categories
and enables them to explore consumer reactions to ideas and advertising copy at an early stage to
avoid costly errors. Furthermore as with all qualitative research techniques motivational research
findings provide consumer researchers with basic insights that enable them to design structured,
quantitative market research studies to be conducted on large more representatives sample of
customers.
V Ethics and Consumer Motivation
While some critics accuse marketers of creating needs and manipulating consumers into
buying goods, they do not need, most people agree that marketers cant create needs, however
they can awaken latent needs and encourage consumers to engage in unwholesome behaviors, e.g.
pleasurable and social aspects of smoking, drinking and gambling are often promoted as enticing
and socially acceptable, while the addictive and health aspects are downplayed. Marketers
sometimes target vulnerable consumers such as childrens, teenagers and elderly, who may not
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have the knowledge or experience to evaluate the products or services being promoted. These
market practices for new regulation and legislation to restrict their use. Many variation advertisers
voluntarily restrict these questionable marketing practices in order to maintain and enhance their
images with their target publics.
Some insurance companies have been accused of using retired military officers to
aggressively market life insurance high cost loans and other financial products to young recruits
and junior officers on American military bases.
These examples cited above clearly indicate that aggressive advertisement can increase the
level of demand for some products. Sometimes in a manner this is determined to the well-being of
the consumers targeted and to society. Social forces are effective in curtailing seemingly unethical
behaviour by marketers. Marketers do responds or forced by legislation to respond when their
advertising efforts are viewed as socially undesirable.
MBE 411 Consumer Behaviour (Module - III)

I. Group Influence (The Influence of Culture & Sub culture, Characteristics of
Culture) (Study Material)
II. Social Class

We can say that Social class is more of a continuum, i.e., a range of social positions, on
which each member of society can be place. But, social researchers have divided this continuum
into a small number of specific classes. Thus, we go by this framework, social class is used to
assign individuals or families to a social-class category.
Within a marketing context, social class is worth thinking about because of the insights it
offers on the market behaviour of consumers, and on the existence of market segments. Social
class influences affect various aspects of products that we aspire to own such as colour, styling,
what preferences we might have for product sizes, what type of stores we will shop at, and how we
go about the shopping process.
A. What is Social Class?
We can now define social class as the division of members of a society into a hierarchy of
distinct status classes, so that members of each class have relatively the same status and the
members of all other classes have either more or less status.
Social class refers to the social position that an individual occupies in society. Thus, your
social standing is a result of characteristics you possess such as education, occupation, ownership
of property and source of income. This leads to the division of society into a hierarchy of social
classes ranging from high status to low status so that, members within each of the social classes
have relatively the same status as each other.
B. Characteristics of Social Classes
Let us try to understand the main characteristics of Social class
1. Persons within a given social class tend to behave more alike
2. Social class is hierarchical
3. Social class is not measured by a single variable but is measured as a weighted function of
ones occupation, income, wealth, education, status, prestige, etc.
4. Social class is continuous rather than concrete, with individuals able to move into a higher
social class or drop into a lower class.
C. Social Class and Social Status
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Status is frequently thought is the relative ranking of members of each social class in terms of
specific status factors e.g.
Relative wealth -> Amount of economic assets
Power -> The degree of personal choice or influence over others
Prestige -> The degree of recognition received from others
D. The Dynamics of Status Consumption
Status consumption which is the process by which consumer endeavour to increase their social
standing through conspicuous consumption and possessions.
The research found that status consumption i.e. ranges the degree to which a consumer is
likely to consume for status and conspicuous consumption measures the extent to which a
consumer is to consumer conspicuously are different measures, yet they are related in that they
both are impacted by interpersonal and word-of-mouth communication.
E. Social Class Categories
The social classes are described for marketing purposes, in terms of the social groups from
which they are drawn in society. On the basis of demographic factors we thus have:
1. The upper-upper social class: This is the wealthy, aristocratic, landed class. It serves as
a reference for the social classes below. It is not a major market segment, because of its
small size.
2. The lower upper social class: This is the newer social elite. Money is relatively new. It is
an achieving group, drawn from professionals and, includes the successful. And wealthy
executive elite, doctors, lawyers and founders of large businesses. It constitutes a major
market for specialised luxury goods.
3. The upper-middle class: This class consists of the moderately successful. It consists of
the professionally educated managers, intellectual elite and successful professionals,
doctors, lawyers, and professors, owners of medium-sized businesses and managerial
executives, and also younger men and women who are expected to reach these
occupational status levels. Housing is important to this class, and also the appearance of
products in general.
4. The Lower-middle class: It is represented by the common man, and the highly paid
individual worker. It includes the small business owners and non-managerial workers.
Persons in this class tend to have high school educations and some college education, but do
not reach high levels in their organisations.
5. The Working Class: This is the largest of the social classes, and is composed of skilled and
semi-skilled workers. They are blue (Khaki) collar workers but have sufficient money for
consumer products, and along with the middle classes, they represent the market for mass
consumer goods.
Within each of these social classes, there are both, underprivileged and over privileged members
depending on whether their incomes are above, or below, the average for the class. For many
products, the groups of interest to the marketer are the middle and working classes, by far the
largest segment of the market.
III. Reference Group Influence

Human are social animal. We are all belong to group, try to please others and take cues
about how to behave by observing actions of those around us. In fact, our desire to fit in or to
identify with desirable individuals or groups is the primary motivation for many of our purchases
and activities.
A group may be defined as two or more people who interact to accomplish either individual
or mutual goals.
A. What is Reference Group?
53
A reference group is any persona or group that serves as a part of comparison (or
reference) for an individual in forming either general or specific values, attitudes or a specific guide
for behaviour.
A reference group is an actual or imaginary individual or organization conceived of having
significant relevance upon individuals evaluations aspirations or behaviour.
B. Types of Reference Group
Normative Reference Group: reference group that influences general or broadly defined
values or behaviour are called normative reference group. An example of childs normative
reference group is the immediate family, which is likely to play and important role in holding
the childs general consumers value and behaviour.
Comparative Reference Group: reference group that serve as benchmark for specific or
narrowly defined attributes or behaviour are called comparative reference groups. It might
be neighbouring family whose lifestyles appears to be admirable or worthy of imagination.
Indirect Reference Group: reference group with whom a person doesnt have direct face to
face contact, such as movie stars, sports heroes, political leaders, TV personalities or even a
well-dressed and interesting looking person or a street corner is called indirect reference
group.
Formal and Informal Reference Group: a reference group can take the form of a larger
formal organization that has a recognized stir, complete with agreement, regular meeting
times and office. A reference group may be small and informal such as group of friend or
student living in a dormitory. Marketers tend to be more successful at influencing formal
group because they are more easily identifiable and accessible. However, as a rule it as
small informal group that exert a more powerful influence on individual consumers as they
are more a part of our day to day lives.
Membership and Aspirational Reference Group: A membership group is a group in which a
person holds membership or has regular face-to-face contact and of whose values,
attitudes, and standards he or she approves. Thus a membership group has a positive
influence on an individual's attitudes or behaviour. An aspirational group is a group in which
a person does not hold membership and does not have face-to-face contact, but wants to be
a member. Thus it serves as a positive influence on that person's attitudes or behaviour.
Positive and Negative Reference Group:
Advice Group: in some cases tough consumers may try to distance themselves from other
people or group that function as avoidance group.
Propinquity: as physical distance between people decreases and opportunity for interaction
increases, relationship are more likely to form physical nearness is called propinquity.
Mere exposure: are come to use like persons or things simply as a result of seeing them more
often, which is known as the mere exposure phenomenon. Greater frequency of contact ever if
unintentional may help to determine ones set of local referents. One study predicts 83% of the
winners of political primaries solely by the amount of media exposure given to candidates.
Group cohesiveness: cohesiveness refers to the degree that members of a group attracted to each
other and value their group membership. As the value of the group the individual increases so too
does the likelihood that guides consumption decisions.
C. Selected Consumer Related Reference Group
Friendship Group: friendship group are typically classified as informal group, because they are
usually unstructured and lack specific authority levels. In terms of relative influences, after an
individuals family, his or her friends are most likely to influence the individual purchase decision.
Friends fulfil wide range of needs; they provide companionship, security and opportunities to
discuss problems that an individual may be reluctant to discuss with family members.
Shopping Group: two or more people who shop together whether for food for clothing or simply to
pass time can be called as shopping group. The motivation for shopping with purchase range from
primary social motive to helping reduce the risk when making an important decision.
54
Work Group: the entirety amount of time that people spend at their jobs, provide ample
opportunities for work groups to serve as a major influential factors.
Virtual Groups or Communities: computers and internet.
Consumer Action Group: these groups are dedicated to providing consumers with assistance in
their effort to make the right purchase decisions in their effort to make the right purchase
decisions, consume products and services in a healthy and responsible manner and to generally
add to the overall quality of their lives. E.g. youth development, community volunteerism, legal
assistance, and wildlife concerns, public health, disaster relief, energy conservation, education,
smoking.
D. Reference Group Influence
Reference group influences consumers in three ways they are informational, utilitarian, and valueexpressive.
(1) Informational Influences
The individual seeks information about brand from professional and experts.
The individual seeks brand related knowledge and experience.
The individual select is influenced by observing seal of approval of an independent testing
organisation.
(2) Utilitarian Influence
So that he satisfied expectation of follow work associates.
Individuals purchase is influenced by a particular brand is influenced by whom he has social
interactions.
Individual influenced by the preferences of family members.
(3) Value expressive influences:
The individual feels that the purchase of a particular brand will enhance the image of others
have of him.
The individuals feel that those who purchase of particular brand posses the characteristics
that he would like to have.
The individual feels that the people who purchase a particular brand are admired by others.
The individual sometimes feels that it would be nice to be like the type of person that ad
show using particular brand.
E. When Reference Group are Important
Reference group influences are not equally powerful for all types of product and
consumption activities. E.g. products that are not very complex is that are low in perceived risk are
less susceptible to personal influence.
Two dimensions that influence the degree to which reference group are important are
whether it is a luxury or a necessity.
As a rule, reference group effects are more robust for purchase that are 1) Luxuries rather than
necessities. 2) Socially conspicuous or visible to others (furniture, clothing)
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F. The Power of Reference Group

Social power: refers to the capacity to alter the action of others to the degree that one is
able to make someone else do something whether they do it willingly or not, you have
power over that person.
Referent power: if a person admires the qualities of a person or a group, he will try to
imitate those qualities by copying the referents behaviours (choice of clothing, cars) as a
guide to forming consumption preferences. Referent power is important to many marketing
strategies because consumers voluntarily change behaviours to please or identify with a
referent.
Information power: a person can have power simply because he knows something others
would like to know. People with information power are able to influence consumer opinion by
virtue of their access to the truth.
Legitimate power: sometimes people are granted power by virtue of social agreements
such as the power given to policeman and professors. The legitimate power conferred by a
uniform is recognized in many consumer contexts, including medical students white coats to
enhance authority with patients. This form of power may be borrowed by marketers to
influence consumers. E.g. advertising features a model wearing a white doctors coat can
add an aura of legitimate or authority to the presentation of the product.
Expert power: Consumers accept information from members within a group whom they
perceive to be experts.
Reward power: when a person or a group has the means to provide positive
reinforcement, that entity will have reward power over a consumer to the extent that this
reinforcement is valued or desired.
Coercive power: a threat is often effective in the short term, but it does not tend to
produce permanent attitudinal or behavioural change. Coercive power refers to influencing a
person by social or physical intimidation. Some campaigns that emphasize the negative
consequences that might occur if people dont use a product are the example of coercive
power.
G. Factors that Affects Reference Group Influence
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Individual
Family
Friends
REFERENCE
Social Classes
Culture and Sub- Culture
GROUP
The degree of influence that a reference group exerts or an individuals behaviour usually depends
on the nature of the individual and the product and or specific social factors.
Information and experience: an individual who has first hand experience with a product
or services can easily obtain full information about it is less likely to be influenced by the
advice of others.
Credibility, attractiveness and power of reference group: a reference group that is
perceived as credible attractive or powerful can easily obtain full information about it is less
likely to be influenced by the advice of others.
Conspicuousness of the product: the potential influence of reference group on a
purchase decision varies according to how visually or verbally conspicuousness the product
is to others. A visually conspicuousness the product is one that will stand out and be noticed
(luxury items); a verbally conspicuousness product may be highly interesting or it may be
easily described to others.
Reference group and consumer conformity: some market leaders are interested on the
ability of reference group to change the consume attitudes and behaviour by encouraging
conformity. To be capable of such influence; a reference group must accomplish the
following. 1. Inform or make the individual aware of a specific product or brand. 2. Provide
the individual with the opportunity to compare his own thinking with the attitudes and
behaviour for the group. 3. Influence the individual to adopt attitude and behaviour that are
consistent with the norms of the group. 4. Legitimize the decision to use the same products
as the group.
H. Celebrates and Reference Group Influence Appeals
Celebrates and other reference group appeals are used effectively by advertisers to
communicate with their markets. Celebrates can be a powerful force in creating interest or actions
with regard to purchasing or using selected goods and services. This identification may be based on
admiration and on aspiration on empathy or on recognition. Five major types groups appeals in
common marketing usages are- celebrity appeals, expert appeals, common-man appeals, executive
and employee appeals and trade or spoke character appeals.
The Celebrities
Celebrities particularly movie stars, TV personalities, popular entertainers and sports icons
provide a very common type of reference group appeal. Advertisers spend enormous sums of
money to have celebrities promote their products, with the expectations that the reading or viewing
audience will react positively to the celebritys association with react positively to the celebritys
association with their product.
Celebrity can be used through four ways
1. Using the celebrity to give the testimonial (celebrity attests to the quality of the product and
service)
2. To give an endorsement (celebrity and his name appears on behalf of a product with which
he may not be an expert)
3. As a company spokesperson (celebrity represents the brand or company over an extended
period of time)
Of all the benefits the celebrities contribute to the firm advertising programs: fame, talent,
credibility, or charisma. Celebrity is the most important. By celebrity credibility we mean both the
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celebritys expertise and trustworthiness. For instance, when a celebrity endorses only the product,
consumers are likely to perceive the product on a higher favourable light and indicate greater
intention to purchase if. In contrast, when a celebrity endorses a variety of products his credibility
reduces.
The Expert
Another reference group appeal used by marketers is the expert, a person who because of
his occupation, special training or experiences is in a unique position. To have that prospective
consumer evaluate the product that the advertising promoters e.g. an advertise for a quality frying
pan may feature the endorsement of a chef or an advertise for volleyball shoes might featured the
endorsement of a champion volleyball team.
The Common Man
A reference group appeal that uses the testimonial of satisfying customers is known as
common-man approach. The advantage of this appeal is that it demonstrates to prospective
customers that someone just like them uses and is satisfied with the product or services being
advertised. The common man appeal is effective in public-health announcement (anti-smoking,
high blood pressure messages) for most people to identify with people like themselves when it
comes to such messages display television commercials how a reason using a problem by using the
advertised product or services. These commercials are known as Slice-of life commercial because
they focus on real life situation.
The Execute and Employee Spokesperson
Like the celebrity spokesperson, executive spokesperson seems to be admired by the
general population because of their achievements and the status. The appearance of a companys
CEO in its advertising seems to imply that someone at the top is watching over the consumers best
interests and it encourages consumers to have more confidence in the firms products or services.
Trade or Spokes-Characters
Trade or spokes-character as well as familiar cartoon characters serve as quasi-celebrity
endorses. This trade spokes it present an idealized image and dispense information that can be
very important for the product or services that they work for.
Other reference group appeal
Respected retailers and the editorial content of selected special interests magazines can also
function as frame of reference. Seals of approval and even object product rating can serve as
positive endorsements that encourage consumers to act favourably toward certain products. For
instances many parents of young children look for Indian Dental Association seal of approval before
selecting a brand of toothpaste. A high rating by an objective rating magazines, such as consumer
report can also serve as an endorsement for a brand.
IV. Family and Family Life Cycle (FLC)

The family is a major influence on the consumer behaviour of its members. The family commonly
provides the opportunity for product exposure and trial, and imparts consumption values to its
members. As a major consumption unit, the family is also a prime target for the marketing of many
Products and services.
A. What is a Family?
A family is a group of two or more persons related by blood, marriage, or adoption who reside
together. The nuclear family is the immediate group of father, mother, and children living together.
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The extended family is the nuclear family, plus other relatives, such as grandparents, uncles and
aunts, cousins, and parents-in-law. The family into which one is born is called the family of
orientation, whereas the one established by marriage is the family of procreation. The term
household is used to describe all person, both related and unrelated, who occupy a housing unit.
B. Functions of the Family

Four basic functions provided by the family are particularly relevant to a discussion of consumer
behaviour. These include
(1) Economic Well-Being: Providing financial means to its dependents is unquestionably a basic
family function. How the family divides its responsibilities for providing economic well-being has
changed considerably during the past 25 years. The traditional roles of husband as economic
provider and wife as homemaker. The economic role of children has changed. Today, even if some
teenage children work, they rarely assist the family financially. Their parents are still expected to
provide for their needs. But some of them get enough pocket money to decide their consumption of
discretionary items.
(2) Emotional Support: The provision of emotional nourishment (including love, affection, and
intimacy) to its members is an important basic function of the contemporary family. In fulfilling this
function, the family provides support and encouragement and assists its members in coping with
personal or social problems. To make it easier for working parents to show their love affection and
support for their children, greeting-card companies have been marketing cards especially for parent
to give to their children.
(3) Suitable Family Lifestyles: Another important family function in terms of consumer
behaviour is the establishment of a suitable lifestyle for the family. Family lifestyle commitments,
including the allocation of time, greatly influence consumption patterns. For example, the increase
in the number of married women working outside the home has reduced the time they have
available for household tasks, and has created a market for convenience products and fast-food
restaurants.
(4) Socialization of Children and Other Family Members: The socialization of family members
is a central family function. In large part, this process consists of imparting to children the basic
value and modes of behaviour consistent with the culture. These generally include moral and
religious principles, interpersonal skills, dress and grooming standard, appropriate manners and
speech, and the selection of suitable educational and occupational or career goals.
C. Family Decision Making and Consumption Related Roles
-> Key consumption related roles
1. Influencer who provide information about a product or services
2. Gatekeepers who control the flow of information about a product or services into the
family
3. Deciders- with the power to determine unilaterally or jointly whether to shop for purchase,
use, consume or dispose of a specific product or services
4. Buyers who make the actual purchase of a particular product or services
5. Preparers who transform the product into a form suitable for consumption by other family
member
6. Users who use or consume a particular product or services
7. Maintainers who service or repairs the product so that it will provide continuous
satisfaction
8. Disposers who initiate or carryout the disposal or discontinuation of a particular product or
service.
-> Dynamics of husband-wife decision making
-> The expanding role of children in family decision making
D. Family Life Cycle (FLC)
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FLC as a means of depicting what was once a rather steady and predictable series of stages
through which most families progressed
The FLC is a composite variable created by systematically combining such commonly used
demographic variables as marital status, size of family, age of family members.
(I)Traditional Family Life Cycle
S1 Bachelorhood:
young single adult living apart from parents
spends their income on rent, home furnishing, purchase and maintenance of automobile,
mobile, ravel and entertainment, clothing and accessories
like to spend time in meeting, dating and mating, get together, picnic and party
This market segment also offers marketers opportunities in terms of single serving
packaging for a wide variety of foods. Overall, there is more individuality in purchasing at
this stage.
S2 Honeymooners
young married couple
this stage continue until the arrival of the couples first child
new home, honeymoon trips and beautiful garden
Purchases include durable goods such as refrigerators and other appliances, inexpensive
durable furniture, home entertainment items such as TV sets.
S3 Parenthood
marriage couple with at least one child living at home it is also called full nest stage
The financial resources thus change significantly. Child rearing and educational
responsibilities increase. Money is now directed to baby furniture, toys, chest rubs, vitamins,
baby foods and baby medicines.
this stage can be divided into shorter phases (The pre school phase, The elementary school
phase, The high school phase, the college phase )
Baby boomers born between (1946-64), Generation X born between (1965-78), Generation
Y born between(1977-1994), Generation Nest(1994 onwards)
S4 Post-parenthood
An older married couple with no children at living home Empty nest stage
They have higher disposable income because of savings and investment an they have fewer
experiences
Hobbies also become an important source of satisfaction. More is spent on luxury
appliances, magazines and health products.
They look forward to being involved grand parents for these reason families in the post
parenthood stage are an important market for luxury goods, new automobiles, expensive
furniture and vacation to faraway places.
S5 Dissolution
The surviving spouses usually wife often tends to follow a more economical lifestyle.
Many surviving spouses seek each other out of companionship others enter into second (3 rd
or 4th) marriage.
Marketing and Traditional FLC
The family life cycle is a better predictor of consumption patterns than age.
Studying traditional FLC helps the marketer to identify and trace the type of product and
services that a households or family might be most interested in at each stage.
The family life cycle concept segments families on the basis of demographic variables; it still
has the disadvantage that it ignores the psychological variables.
(II) Non Traditional FLC
Non traditional FLC stages include not only family household but also non family households.
S1 Family Households
1. Childless couples not to have children, career oriented delay marriages
2. Couple who marry later in life (30) More career oriented, lucky to have fewer or even no
children, stress quality lifestyle.
3. Single parents I high divorce rate (about 50%) contribute to a portion of single of single
parent households.
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4. Single parents II Youngman or women who has one or more children out of married state
(wedlock)
5. Single parents III A single person who adopts one or more children.
6. Extended family young single-adult children who return home to avoid the expenses of
living alone while establishing their careers. Divorced daughter or son and grandchildren
return home to parents.
S2 Non-family Households
1. Increased couples increased acceptance of heterosexual and homosexual couples.
2. Divorced persons (no children) - high divorce rate contributes to dissolution of households
before children are born.
3. Single persons (most are young) - primarily a result of delaying first marriage; also, men
and women who never marry.
4. Widowed persons (most are elderly) longer life expectancy, especially for women, means
more over -75 single person households.
Consumption in Non-Traditional families
When households undergo status changes they often undergo spontaneous change in consumption
related preferences and thus become attractive targets for many marketers.
V. Lifestyle Profiles of the Social Class (AIO & VALS),

Lifestyle marketing is a process of establishing relationships between products offered in the
market and targeted lifestyle groups. It involves segmenting the market on the basis of lifestyle
dimensions, positioning the product in a way that appeals to the activities, interests and opinions of
the targeted market and undertaking specific promotional campaigns which exploit lifestyle appeals
to enhance the market value of the offered product. There is large number of variable which
influences lifestyle. In brief as already referred they may be divided into three groups namely.
Characteristics of Lifestyle
1 Lifestyle is a group phenomenon: A person's lifestyle bears the influence of his/her
participation in social groups and of his/her relationships with others. Two clerks in the same office
may exhibit different lifestyles.
2 Lifestyle infuses various aspects of life: An individual's lifestyle may result in certain
consistency of behaviour. Knowing a person's conduct in one aspect of life may enable us to predict
how he/she may behave in other areas.
3 Lifestyle implies a central life interest: For every individual there are many central life
interests like family, work, leisure, sexual exploits, religion, politics etc. that may fashion his
interaction with the environment.
4. Lifestyles vary according to sociologically relevant variables: The rate of social change in
a society has a great deal to do with variations in lifestyles. So do age, sex, religion, ethnicity and
social class. The increase in the number of double income families and that of working women have
resulted in completely different lifestyles in the 1980's in India.
Approaches to study Lifestyle
The study of lifestyle is interdisciplinary. It draws on a variety of disciplines such as anthropology,
psychology, sociology and economics. Marketing uses this diverse approach for segmenting,
targeting and positioning which forms the core of marketing strategy. Because lifestyle refers to the
way in which people live and spend money, consumers psychographic profiles are derived by
measuring different aspects of consumer behaviour such as:
1. 1 Products and services consumed
2. 2 Activities, interests and opinions
3. 3 Value systems
4. 4 Personality traits and self-conception
5. 5 Attitude towards various product classes
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Many approaches are available to the study of psychographic variables. One of the ways is to study
the lifestyle variables by an AIO inventory for use in segmenting, targeting and positioning. Another
lifestyle approach is by using VALS typology.
AIO Inventory
Activities: activities relate to research how the time spent by an individual, family or a group on
various activities such as working, resting, vacation, hiking, riding, playing, studying recreating,
etc. by asking suitable questions various activities of an individual, household or group are studies
and measured. Based on these replies society is divided into various groups. The various activities
depends upon social class one belongs, status i.e. the level of income, level of education,
profession, vocation or calling, area of residence, personality, knowledge, interest among other
factors also depend upon age. Young boys or girls or recently married couples may prefer to own a
house or spend more on fashion, travel as compared to middle aged person. Old family members
interest may be more on quiet simple life as compared to outing.
Interests: The interests also depend upon level of education. A person highly educated may have
greater interest in reading books of his subject while less educated person may not read books or
may prefer go to a movie or watch TV.
The preference and priorities are also affected by the regions one live.
The culture and social set up also decides or at least influences preference and interests.
Again with in same social group the interest of young stars may be different than that of
elders in almost every thing like eating, drinking, playing and researchers has to find out all
these points through well structured questions.
Religion is another variable which decides interests in certain respects and sometimes
influence entire thought process.
Language is another variable which influences ones and families interest.
Opinions: the opinion about various activities, products, services, health, fashion, books, beauty,
nature of consumption, politics, tours, travels, education, nature of education, institute, houses,
buses also decides consumer behaviour and so the consumption of various goods and services.
There fore researchers wants to study through formal or informal surveys, opinion poles etc. find
out opinion of consumers so that the goods and services may be modified, improved, restructured
and innovation may be carried out to introduce now products to satisfy the requirements of various
consumers.
The opinion studies are also conducted to find out opinion on various events which have
taken place, films, and social issues, political or cultural issues. It has become an important tool to
find out consumers opinion but this tools is successful when questions are very few and properly
structured first to get response from respondents and secondly to arrive at a conclusion to modify
the strategy.
Application of AIO Studies
1. Studying the lifestyle closely through the AIO inventory of heavy/medium/light users of a
product has been found to be immensely useful for marketers to develop their strategy in
positioning and product differentiation.
VALS Value and Lifestyle

Acronym for Values and Lifestyles, a system for grouping consumers according to
psychological and sociological theories in order to predict their behaviour in the purchase decision
process. There are three main categories: need-directed-consumers who make purchases based
solely on need; outer-directed-consumers who make purchases based on their perceptions of the
way others view them; and inner-directed-consumers that make purchases out of some inner need.
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VALS can aid in defining targets for products and are also helpful in the development of advertising
copy and media strategies.
The best-known psychographic segmentation is called VALS, which stands for "value and
lifestyles." It was developed in the 1970s to explain changing U.S. values and lifestyles. It has since
been redone to enhance its ability to predict consumer behaviour. Segmentation research based on
VALS is a product of SRI Consulting Business Intelligence. The concept was reintroduced in 1978 by
the California consulting firm of SRI International.
As the VALS Framework shows, the groups are arranged in a rectangle and are based on
two dimensions. The vertical dimension segment people based on the degree to which they are
innovative and have resources such as income, education, self-confidence, intelligence, leadership
skills, and energy. The horizontal dimension represents primary motivations and includes three
different types. Consumers driven by knowledge and principles are motivated primary by ideals.
These consumers include the Thinkers and Believers groups. Consumers driven by a goal of
demonstrating success to their peers are motivated primarily by achievement. These consumers
include Achievers and Strivers. Consumers driven by a desire for social or physical activity, variety,
and risk taking are motivated primarily by self-expression. These consumers include both the
Experiences and Makers. At the top of the rectangle are the Innovators, who have such high
resources that they could have any of the three primary motivations. At the bottom of the rectangle
are the Survivors, who live complacently and within their means without a strong primary
motivation of the types listed above. The VALS Framework gives more details about each of the
eight groups
VALS Framework and Segment
Innovator. These consumers are on the leading edge of change, have the highest incomes,
and such high self-esteem and abundant resources that they can indulge in any or all selforientations. Successful and sophisticated, they are open to change and are concerned with
social issues. As consumers, they display discriminating tastes and buy to please themselves
rather than to please others. They are located above the rectangle. Image is important to
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them as an expression of taste, independence, and character. Their consumer choices are
directed toward the "finer things in life."
Thinkers. These consumers are the high-resource group of those who are motivated by
ideals. They are mature, responsible, well-educated professionals. Their leisure activities
centre on their homes, but they are well informed about what goes on in the world and are
open to new ideas and social change. They have high incomes but are practical consumers
and rational decision makers.
Believers. These consumers are the low-resource group of those who are motivated by
ideals. They are conservative and predictable consumers who favour American products and
established brands. Their lives are cantered on family, church, community, and the nation.
They have modest incomes.
Achievers. These consumers are the high-resource group of those who are motivated by
achievement. They are successful work-oriented people who get their satisfaction from their
jobs and families. They are politically conservative and respect authority and the status quo.
They favour established products and services that show off their success to their peers.
Strivers. These consumers are the low-resource group of those who are motivate by
achievements. They have values very similar to achievers but have fewer economic, social,
and psychological resources. Style is extremely important to them as they strive to emulate
people they admire.
Experiences. These consumers are the high-resource group of those who are motivated by
self-expression. They are the youngest of all the segments, with a median age of 25. They
have a lot of energy, which they pour to physical exercise and social activities. They are
young, action-oriented, and impulsive and tend to take risks, with sufficient resources; they
are eager to try new things and are keen customers. They are avid consumers, spending
heavily on clothing, fast-foods, music, and other youthful favourites, with particular
emphasis on new products and services.
Makers. These consumers are the low-resource group of those who are motivated by selfexpression. They are practical people who value self-sufficiency. They are focused on the
familiar-family, work, and physical recreation-and have little interest in the broader world.
As consumers, they appreciate practical and functional products.
Survivors. These consumers have the lowest incomes. They have too few resources (little
education, few skills, and no money) to be included in any consumer self-orientation and are
thus located below the rectangle. There are too concerned with meeting their daily needs to
worry about tomorrow. Their purchasing power is limited to daily essentials. They are the
oldest of all the segments, with a median age of 61. Within their limited means, they tend to
be brand-loyal consumers.
Applying the VALS Concepts to Marketing.

1> Marketing Plan Development: the lifestyle concept however as a framework for research
recommendations, offers marketing practitioners understandable portraits of people
engaged on recognizable patterns of consumption. A lifestyle portrait for heavy users of
mens after shave lotion reveals not only how old user are, where they live and how
socioeconomic group they belong to, but also describes their interests and opinions and
how they feel about their daily activities. More importantly it predicts what other products
they are likely to buy and which media are most likely to reach them.
2> Media Selection: media salespeople generally advertisers through accurate profile
description of their readers, viewers or listeners using demographics gathered and
presented either by individual media representatives or through syndicated media research
resources. This type of demographic analysis provides little insight into peoples attitudes
and opinions. Lifestyle analysis provides considerably more information about the
personality characteristics, attitudes, opinions and product use patterns of heavy uses of
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newspapers, magazines and television. And consumers can be differential further on the
basis of the types of magazines or programs they are most likely to read or watch.
3> Creative Strategy Formulation : lifestyle information about target consumers is helpful
to creative people of an ad agencys creative department in three ways
It gives them an idea of what type of consumers will be at the other end of the
communication. This is useful is choosing actors and spokespeople for the product
and placing them in appropriate settings.
Lifestyle data suggests the tone and style of language appropriate to appeal to target
audiences humorous or serious, contemporary or traditional.
Lifestyle information indicates how the product fits into peoples lives, how they feel
about it, and how they may be using it to communicate things about themselves to
other people.
4> Product Poisoning: establishing a product in a consumers frame of references calls for an
understanding of just what that frames of references is. Take as an example a new brand of
toothpaste. A distinguishing characteristic is that it has an extra whitening ingredient.
Positioning this product effectively would demand research into heavy users of toothpaste
that promise sparking white teeth, such as the competing product, pearl drops. If target
consumers turned out to be teenagers and young singles, advertising and media strategies
would probably sell sex appeal a print campaign in Seventeen or Cosmopolitan, along
with a heavy television and radio schedule. But AIO research might just as reality uncovers
surprising data on this group of teens, who may be attached by more traditional values. A
more appropriate advertising message would then be to emphasize the health benefits of
the toothpaste.
5> Retail Strategy Development: just as lifestyle information can be used to identify
consumers who are likely to use certain goods and services, it can also point to differences
in shopping behaviour. An early study identified two purchasing patterns; creative and
passive. Creative consumers are more likely to respond to new modes of distribution than
are passive consumers. They were found in the vanguard of people who first popularized
innovative retail environment such as the supermarket and the shopping centre.
VI. Consumer Psychographics

Psychographics is commonly known as study of lifestyle of consumer and lifestyle is basically
how a person lives. Ones lifestyle is a function of inherent individual characteristics that have been
shaped and formed through social interaction as the person evolves through life cycle. It plays an
important part in building consumer behaviour and helps in promotion of those products and
services which are related to items of personal care, fashion and auto mobiles, telephone services
and alcoholic drinks, news paper, magazines, food products like milk, tea, coffee which are sold by
brand names.
Lifestyle and Consumption Process
Lifestyle Determinants
Demographics
Subculture
Social Class
Motives
Personality
Emotions
Values
Household life cycle
Culture
Past experiences
Lifestyle
How we live
Activities
Interests
Likes / Dislikes
Attitudes
Consumption
Expectations
Feelings
Impact on Behaviour
Purchases
How
When
Where
What
With whom
Consumption
Where, With whom, How, When and What
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In a country like of the size of India where life style differs widely from region to region the
study of consumer Psychographics is of great significance to marketers.
What is demanded of liked in Bengal may not be demanded in Punjab, Maharastra, Gujrat or
South India because of vast differences in lifestyle.
Lifestyle depends not only on the regions but also on ones profession.
A poor person has no life style and looks only for necessities and things of utility.
The psychology of higher educated author, writer or thinker is different than of a common
person.
The lifestyle also depends upon health, weather, culture, economic, social, political factors
and demographic inferiority and superiority complex also influences psychology and the
buying habit.
There are people who are conscious of their health, look, tooth, appearance, complexion etc.
irrespective of their income, education, region, culture etc.
Therefore companies make separate products for them. In brief Psychographic variable depends
upon activities, interests and opinions (AIOs). The activities affect lifestyle to a great extent.
Lifestyle of the students, professionals, shopkeepers, farmer, and singer are different from each
other. The interest partly depends upon activities but partly on other factors. The opinion of various
individuals about product, philosophy, religion, polities and so on.
Psychographics is an important and often little understood area of market research. Over
the last thirty years interest in personality-based approaches to consumer behaviour understanding
how consumers of particular products can be divided into types or classes - has grown
considerably. Better research designs, more appropriate measures and more realistic expectations
have led to results that shed new light on consumer choice and are directly applicable in marketing
management and research. Understanding Psychographics helps marketers to
See beyond demographics to consumers relationships with goods and services. That is most
products and services do not lend themselves to demographic segmentation. Instead, they can
be segment using Psychographics.
Venture into cross-marketing with other products in the same constellation. Suppose you are a
marketer of athletic bags. To be effective, you can target certain athletes such as basketball
players, tennis players, racquetball players, etc.., identifying their needs and the various
products and services they use. Doing so would allow you to market your bag in conjunction
with those products and services.
Definition
Psychographic considers life experience basically based on psychology of the group and
accordingly decides market strategy and places them in different groups life style of Psychographic
can be defined as a Composite measures of the activities a consumer enjoys in and spends time
doing of interest of the consumer and of the opinions held by the consumer Psychography studies
these factors in detail to formulate marketing strategy and segmenting consumers in different
groups so that they may be targeted accordingly.
In brief Psychographic is a science which studies all the activities, interests and opinions of
consumers through surveys, observations, personal discussions and using various statistical and
economical tools.
I Psychographics Vs Demographics
1>In Psychographic studies generally one depends upon lifestyle i.e. activities, interests and
opinions of an individual while demographics studies and segments the markets based on sex, age,
education, income which are collected by all the countries in census data.
2>Through demographic studies one find outs activities, interests and opinions of consumers of
various sex, age groups and literacy standards when Psychographic and demographic profiles are
combined it becomes very useful and powerful information for advertisement, sales promotion and
changing the attitude of consumers or mould their views on various issues.
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3>In India also lately there is increasing on studies in demographics / Psychographic profiles of
consumers to promote their products and services and this approach had been quite successful.
Colgate is placing great emphasis in its advertisement aimed at children about strength of
teeth and their long life
Pepsodent of HUL also gives almost similar message to children about there tooth paste.
Nestle Cerelac has depicted that doing with hormone foods; mothers also consider balanced
nutrition again it depicted that how good cookery which is small thing make a big difference
in life.
4> the Psychographic may divide lifestyle into traditional, very traditional, non-traditional, modern
etc. and through demographic studies they can be further segmented as per age, income, sex,
profession etc. thus two together helps one to know in great detail about the consumer and then
attempt can be made to influence their behaviour fro a particular product or services. The further
studies also help to know the beliefs, tastes, likings, disliking of various segments to arrive at a
strategy. It can be tried to change the personality and lifestyle for which there is big scope in a
country like India.
II Psychographics and Motivational Research
1> Psychographics is the study of life style that exists at a point of time but motivation is the
reason for particular life style and thus two are highly interdependent. Thus Psychographics study
the existing position; the motivation research studies the reasons for current behaviour and also
studies how this behaviour can be changed.
2> Actually no action of a human being is without some motive or other but what forces but to act
differ from individual to individual based on if personality. Therefore, while psychographic studies
the present lifestyle the research on motivation helps to find out why and how a person acts in a
particular manner. The motivational research studies the behaviour, goals of different groups,
classes and the process motivates a consumer to buy or not to buy particular goods and services to
that marketer may use to result to change the attributes which what we feel about a concept
which may be brand, category, a person, an ideology or any other infinity about which we can think
and to which we can attack.
3> The main objective of motivational research in marketing, advertising and applied social
sances is to influence behaviour. E.g. those who have reasons or high income get many activities
for them done on payment like laundering they more often in restaurants rather than cooking at
home. They depend more on time saving products like Two Minutes Noodles (Nestle), precooked or
practically cooked food. They do not prepare snacks themselves but buy them from market.
VII. Application of Psychographic Analysis

Marketing Segmentation: Psychographic research about activities, interests and opinion on
various products, services and issues is an important tool to segment the market for various
section of the society according to their lifestyle and then introduce products to satisfy the needs of
various groups. It would not have been possible to segment the market without psychographics
studies.
The study of activities of various consumer helps to find out needs of different persons and families,
segment the markets and produce the product for different segments.
The research has revealed that people of different professions, different groups, education
and cultural background, people of different geographical regions, languages, religion,
culture, and climate have different needs.
This has helped marketer to adjust products for different needs.
This has helped marketer to adjust products for different groups and promote their sales
accordingly.
67
It helps in segmenting to groups into various subgroups to produce goods and services
required by them which help in promoting sales accordingly e.g. Colour of lipstick or flavour
in scents.
The opinion of different persons in same psychographic group always is not similar. So the
research finds two things. First, he studies the opinion of different persons for their different
opinions. It helps marketer two things first to segment the market according to opinion,
second to make effort to change the opinion and third to improve their service or products.
Promotional Campaigns: the purpose of all consumer behaviour studies and so Psychographic
analysis is to promote sales of existing products or develop a new product according to AIO
(activities, interests and opinion) study, if some one wants quality razor blade, soap or cosmetics it
is produced for specific classes and their activities, interests and opinions are used for sales
promotion.
When it has found that some persons like very cool, AC KENSTAR has accordingly made its
ad campaign.
When it was discovered that consumers want the service promised, IODEX made a
campaign for its balm that if there is no relief the price will be refunded moreover it has
changed to colour of the balm form black to green.
When Nestle found out that people opinion in new noodle is not as good as for old formula
it reverted to old formula Maggie.
When scientist and doctors found that smoking is injurious to health and may cause cancer
Govt. started campaign against smoking.
There are companies like Bombay Dyeing who announces discount sales every year and
creates interests in them to push sales.
People like low cost car, that motivated Tata motors to rolled out TATA NANO.
Creating Relationships with Customers:
Develop program that can enhance consumers loyalty and commitment to the company
brand. E.g. an Airline company develops a frequent flier program based on the concepts of
relationship marketing. The frequent flier program rewards loyalty and commitment through
dividend miles.
Develop marketing programs to enhance the quality of consumers relationships with a
corporation firm. E.g. a company such as Bank of America can enhance its relationship
quality with its customers by launching an aggressive campaign designed to consolidate and
reinforce the perception that the bank satisfies consumers needs, that it is socially
responsible, that it treats/ its employees well, and so on.
Develop marketing program to enhance the quality of consumers relationships with a
service firm. E.g., a local bank can do better by enhancing its relationships with its
customers. It can do so by establishing and reinforcing programs designed to increase the
banks responsiveness to customers needs.
Developing new product concepts: Study of existing market segments and analysis of their
needs have typically been used to conceptualize on new product opportunities.
VIII. Opinion Leadership Process.

Opinion leadership or word-of-mouth communication is the process by which one person the
Opinion leader informally influences the actions of attitude of others who may be opinion seekers of
merely opinion recipients.
The key characteristics of the influence is that it is interpersonal and informal and takes
place between two more people none of whom represents a commercial selling source that would
represent a common selling source that would gain directly from the sale of something. Word-ofmouth implies personal or face-to-face communication although it may take place in a telephone
conversation.
68
One of the parties in a word-of-mouth encounter is the Opinion leader, who offers advice or
information about product or services. An Opinion receiver when another product is bought up as
part of the discussion. And who actively seek information advice about product is called as opinion
seeker. Example of opinion seeker.
During lunch a co-worker mentions the design to purchase a car and the colleague
recommends a particular brand.
A person shows a friend photograph of his recent skiing vacation and friend suggest a
particular film for better pictures.
A women who recently moved information a new how wants more light in her family room
and calls neighbour for the mane of a good electrician
I Dynamics of Opinion Leadership Process
The opinion leadership process is a very dynamic and powerful consumer force. Some of the
reasons for the effectiveness of opinion leaders are follows:
Credibility: Opinion leaders are highly credible source of information because they usually are
perceived as objective concerning the products or services information or advice they dispose, also
they receive no compensation for the advice. Because opinion leaders often base their product
comments on first hand experience, their advice reduces the perceived risk or anxiety from opinion
receivers.
Positive & negative product information: Information provided by marketers is invariably
favourable to the product, thus the very fact that opinion leader provides both favourable &
unfavourable information adds to their credibility.
Information and advice: Opinion leaders are the source of both information and advice. They
may simply talk about their experience with a product; relate what they know about a product or
more aggressively, advice others to buy or to avoid a specific product.
Opinion leadership is category specific: This means opinion leaders often specialize in
creation product categories about which they offer information and advice. When product
categories are discussed, they are just likely to reverse their roles and become opinion receivers.
Opinion leadership is a two way street: An opinion leader may also be influenced by an opinion
receive as the result of a product related conversation.
Opinion leaders ------------- opinion receivers
II Motivation behind Opinion Leadership
The motivation of those who provide and those who receive product-related information are: The
need of opinion leader:
1. Motivation theory suggests that people may provide information to satisfy basic needs of
their own.
2. Opinion leaders may simply be trying to reduce their post-purchase dissonance.
3. Opinion leaders true motivation may really be self confirmation or self-involvement.
4. Self-involvement may also be motivated by product-involvement, social and message
involvement.
Product involvement: so pleased or disappointed with product that they simply tell others about it.
Social involvement: needs to share product-related experience (friendship, neighbourliness, love)
Message involvement: individual bombarded with advertising slogans and messages tend to discuss
them.
The need of opinion receiver: Opinion receivers satisfy a variety of needs by engaging in
product-related conversations.
1. They obtain new-product or new-message information.
2. They reduce perceived risk by receiving first hand information
3. They reduce search time in identification of a newer product or services.
Purchase pals
1. Researchers have explained the influence of purchase pal as information source who actually
accompany consumer on shopping trips.
69
2. Used 9 % for grocery items, used 25 % for electronic equipment

3. Male purchase pals are used as source of product category expertise, prior information, and
retail store and price information.
4. Female purchase pals are used for moral support and increase confidence in the buyers
decision.
Surrogate buyers Vs opinion leaders
Here are instances in which some buyers replace opinion leaders in their roles. E.g. working is
increasingly turning to wardrobe consultants to help in purchasing decision, many services provides
make decision for their clients.
III Measurement of Opinion Leadership
The self designating method
1. Respondents are asked to evaluate the extent to which they provided others the products
information or have otherwise influenced the purchase decision of others
2. The researchers use single question and multiple question where as the later is more
reliable.
3. This method is used more often because researchers find it easy to include it in market
research questionnaires.
4. This method relies on respondents self evaluation however it may be open to bias.
The socio metric method
1. This method measures the person-to-person informal communication to consumers
concerning products or product categories.
2. Respondents are asked the specific individual to whom they provided information and who
provided them the advice or information about the product.
3. In first instances if respondents identify are or more individual to whom they have provided
information, they are classified as opinion leaders.
4. In second instances primary respondents are tentatively classified opinion leaders.
The key informant method
1. Opinion leadership can also be measured through the use of a keep informant, a person who
is keenly aware of or knowledgeable about the nature of social communications among
members of a specific group. The key information is as hey to identify those individual in the
group who are most likely to be opinion leaders.
2. To the informant doesnt have to be a member of the group under study.
3. This method is relatively in expensive because it requires only one individual to be
interviewed.
4. It has greatest potential in the study of industrial and institutional opinion leadership.
Ex. A professional salesperson might serve as key informants in identification of specific purchase
decision of other potential customer.
A professor may serve as the key informant foe a college class, identifying those students who are
most likely to be opinion leaders with respect to a particular issue.
The objective method
This method measures individuals ability to influence others under controlled circumstances. It
involves placing new products or information with selected individual and then tracing the resulting
web of interpersonal products.
IV The Interpersonal Flow of Communication
Ideas often flow radio and print media to opinion leaders and from them to general public. This is
called two step flow of communication theory. It protects opinion leaders as direct receivers of
information from impress ional mass-media source who in turn transmit this information to the
masses.
70
Mass Media
Opinion Leaders
Opinion Receivers
( The Masses )
Multi-step flow of communication
Information Receives
This model depicts the information of information from mass media as a multi-step flow. The
revisers model takes into account the fact that information and influence of ten are two ways
process in which opinion leaders both influences and are influenced by opinion receivers.
Opinion leadership and marketing strategy
Marketers have long been aware of the power that opinion leadership exerts on consumers
preference and actual purchase behaviour that can paid advertising or a company salespeople.
In instances where informal word of mouth doesnt spontaneously emerge from the uniqueness of
the product, some marketers have deliberately attempted to stimulate or simulate the opinion
leadership.
Program designed to stimulate opinion leadership
Ad and promotional program designed to purchase consumers to tell your friends how much you
like your product are one way in which markets encourage consumers decisions of their products
or services. The objective is to run advertisement or direct-marketing and informative to provoke
consumers into discussing the benefits of the product with others.
Advertisement simulating opinion leadership
A firms advertisement can also be designed to simulate product discussion by portraying people in
the act of informal communication. This promotional tactics suggests that it is appropriate to
discuss a particular subject or product.
Word of mouth may be uncontrollable
Although most marketing managers believe that word-of-mouth communication is extremely
effective, one problem that they sometimes overlook is the fact that informal communication is
difficult to control. Negative comments, frequently in the form of rumours that are untrue can
sweep through the marketplace to the determent of a product.
Some common rumours that have plagued marketer include the following
1. the product was provided under unsanitary condition
2. The product contained an unwholesome or culturally unacceptable ingredient.
3. The product functioned as an undesirable depressant or stimulant.
4. The product included a career-causing almost or agent.
5. The firm was owned or influenced by an unfriendly or misguided foreign country or
Government agency or religious cult.
Creation of opinion leaders
71
Marketing strategies agree that promotional efforts would be significantly improved if they could
segment their markets into opinion leaders and opinion receivers. Then they could direct their
promotional messages directly to the people most likely to carry the word to masses. Because of
the difficulties inherent in identifying appropriate opinion leaders. However, some researchers have
suggested that it might be more fruitful to create product specific opinion leaders.
MBE 411 Consumer Behaviour (Module - IV)

I. Consumer Research (Study Material)
II. Diffusion of Innovations

The framework for exploring consumer acceptance of new products is drawn from the area
of research known as diffusion of innovation. Diffusion of innovation is concerned with two closely
related processes:
The diffusion process
The adoption process
Diffusion is a macro process concerned with the spread of a new product from its source to
the consuming public. Adoption is a micro process that focuses on the stage through which the
stages through which an individual consumer passes when deciding to accept or rejects a new
product.
III. The Diffusion Process

The diffusion process deals with how innovations spreads, i.e. how they are assimilated with in a
market. Diffusion is a process by which the acceptance of an innovation (new product, service and
idea) is spread by communication (mass media, sales people) to members of a social system. This
definition includes four base element of different process.
1. The innovation
2. The channel of communication
3. The social system
4. Time
1. The innovation
An innovation is a product, service, idea, process, behaviour, or any other object which is
considered new by consumers. Innovations require acceptance from consumers to be successful,
but they also require them to change their existing behavioural pattern and habits. As there is no
universally accepted definition of innovation, this can be classified as firm, product, market, and
consumer directed definition of innovation.
Innovations come in different degrees.
A continuous innovation includes slight
improvements over time. Very little usually changes from year to year in automobiles and even
automobiles of the 1990s are driven much the same way that automobiles of the 1950 were
driven. A dynamically continuous innovation involves some change in technology, although the
product is used much the same way that its predecessors were usede.g., jet vs. propeller
aircraft. A discontinuous innovation involves a product that fundamentally changes the way that
things are donee.g., the fax and photocopiers. In general, discontinuous innovations are more
difficult to market since greater changes are required in the way things are done, but the rewards
are also often significant.
72
Firm oriented: this approach treats the newer of a product from the perspective of the company
producing or marketing it. When the product is new to the company, it is considered new and if
ignores whether it is actually one to the market place (competitor, customer)
Product oriented definition: this approach focuses on the features inherent in the product itself and
on the effects these features are likely to face on consumers. It defines the following three types of
product innovation.
1. A continuous innovation has the least disruptive influence on established patterns. It
involves the introduction of a modified products rather than a new product.
2. A dynamically continuous innovation is more disruptive than a continuous innovation but still
doesnt after established behaviour patterns. It may involve creation of a new product or
modification of an existing product.
3. A discontinuous innovation requires consumers to adopt new behaviour patterns.
Market-oriented definition: a market oriented approach judge the newness of a product in terms of
how much exposure consumers have to the new product. The two method oriented definition are
1. A product is considered new if it has been purchased by a relatively small percentage of the
potential market.
2. A product is considered new if it has been or the market for a reality short (specific) period
of time.
Consumer oriented definition: in this context, a new product is any product that a potential
consumer judges to be new. In other words newness is based on the consumers perception of the
product rather than physical features or market realities.
Product characteristics that influences diffusion
All products that are new dont have equal potential for consumer acceptance. Some products seem
to catch or almost overnight (cordless telephone) where as others take a long time to gain
acceptance.
Diffusion researchers have identified 5 product characteristics that seem to influence consumers
acceptance of new products: 1.Relative advantage 2.Compatibility 3.Complexity 4.Triability
5.Observability
Relative advantage: the degree to which potential customers perceives a new product as superior
for existing substitute is its relative advantage.
Compatibility : the degree to which potential consumer feel a new product is consistent with their
present needs, values and practices is a measure of its compatibility.
Complexity : the degree to which a new product is difficult to understand or use, affects product
acceptance, clearly the easier. It is to understand and use, the more likely is to be accepted. The
issue of complexity is important when attempting to gain market acceptance for high-tech
products. Four type of tech act as barrier.
Fear of technical complexity
Fear of rapid obsolescence
Fear of social rejection
Fear of physical harm.
Triability: the degree to which a new product is capable of being tried on a limited basis. The
greater the opportunity to try a new product, the easier it is for consumer to evaluate if and
ultimately adopt if.
Observability: it is the ease with which a product benefits or attributes can be observed imagined
or described to the potential consumer products. That have high degree of social visibility like
fashion items are more likely diffused than products that are used in private (new development). A
tangible product is promoted more easily than an intangible product (i.e. service)
Resistance to innovation
Low adoption rate, low compatibility, high complexity, low observability, low communicability. The
increase in information and opinions available to the consumer (innovation overlooked) are so great
that serious impair, decision making. As a result the consumer finds it difficult to make comparisons
among the available choices and delay the difference of innovation.
73
2. The channel of communication

Communication channels are the tools which help the marketer reach the consumer, and the
consumer to reach out to other consumers in a social network. Information can flow through
impersonal (mass media), interpersonal (salespeople), and personal channels (word-of-mouth) of
communication. How quickly an innovation spreads through a market depends to a great extent on
communication between the marketer and consumer as well as among consumers (word-of-mouth
communication)
Two step flow and multi-step flow of communication word of mouth communication
Marketing strategies to overcome resistance
Improve product performance
Improve product positioning
Improve packaging
Use well-known brand name
Reduce price by lowering cost.
Elicit endorsement and testimonial
Facilitate market exposure through trial
Educate customer
Use change agent
Make fun of negative image.
Create a unique image.
Understand and respect tradition.
3. Social system
A set of interrelated units that are engaged in joint problem solving to accomplish a common goal.
4. Time
Time is the backbone of the difficult process. It pervades the study of different in 3 integrated ways
The amount of purchase time
The identification of adoption categories
The rate of adoption
Purchase time: Purchase time refers to the amount of time that elapses between consumers
initial awareness of a new product and the point at which they purchase or reject it. When the
individual purchase time is short, a marketer can expect that the overall rate of different will be
faster than when individual purchase time is long.
Adoption categories: This concept involves a classification schemes that indicates where a
consumer, stands in relation to other consumer in terms of time when consumer adopts a new
product. Five type of adoption categories are there, innovator, early adopter, early majority, late
majority, laggards.
Adopter
Category
Innovators
Description
Percentage with in a
Population that adopts
Venturesome-very early to try new ideas, acceptable

If risk is closing communicates with other innovators
More cosmopolite.
Early adaptor Respect- more integrated into the local social system
Contain greatest no of opinion leaders, are voce models
Early majority Deliberate- adopt new ideas just prior to the average
Time, seldom hold leadership position, deliberate for
Some time before adopting.
2.5 %
13.5 %
34.0 %
74
Late majority Sceptical-adopt new ideas just after the average time
Innovation approached cautiously.
Laggards
Traditional- the last people to adopt an innovation
Most locality in outlook, but oriented, suspicious new
Total
34.0 %
16.0 %
100.0 %
The adoption categories are generally depicted as taking characteristics of a normal distribution
that describe the total population that ultimately adopt a product.
Rogers identifies several additional characteristics dominant in the innovator type: (1)
venturesome, desire for the rash, the daring, and the risky, (2) control of substantial financial
resources to absorb possible loss from an unprofitable innovation. (3) The ability to understand and
apply complex technical knowledge, and (4) the ability to cope with a high degree of uncertainty
about an innovation.
Characteristics Rogers identified in the Early Adopters: (1) integrated part of the local social
system, (2) greatest degree of opinion leadership in most systems, (3) serve as role model for
other members or society, (4) respected by peers, and (5) successful.
Characteristics Rogers identified in the Early Majority: (1) interact frequently with peers, (2)
seldom hold positions of opinion leadership, (3) one-third of the members of a system, making the
early majority the largest category. (4) Deliberate before adopting a new idea.
Characteristics Rogers identified in the Late Majority: (1) one-third of the members of a system,
(2) pressure from peers, (3) economic necessity, (4) skeptical, and (5) cautious.
Characteristics Rogers identified in the Laggards: (1) possess no opinion leadership, (2) isolates,
(3) point of reference in the past, (4) suspicious of innovations, (5) innovation-decision process is
lengthy, and (6) resources are limited.
The
bell shaped curve frequently illustrates the rate of adoption of a new product. Cumulative
adoptions are reflected by the S-shaped curve. The saturation point is the maximum proportion of
consumers likely to adopt a product.
75
In the case of refrigerators in the U.S., the saturation level is nearly one hundred percent of
households; it well below that for video games that, even when spread out to a large part of the
population will be of interest to far from everyone.
Rate of adoption: The rate of adoption is concerned with how long it takes a new product or
services to be adopted by members of a social system, i.e. how quickly it takes a new product to be
accepted by those who will ultimately adopt it.
IV. The Adoption Process

In his book Diffusion of Innovations, Rogers defines the diffusion process as one "which is
the spread of a new idea from its source of invention or creation to its ultimate users or adopters".
Rogers differentiates the adoption process from the diffusion process in that the diffusion process
occurs within society, as a group process; whereas, the adoption process is pertains to an
individual. Rogers defines "the adoption process as the mental process through which an individual
passes from first hearing about an innovation to final adoption".
Stages in Adoption Process

It is often assumed that the consumer moves through five stages in arriving at a decision to
purchase or reject a new product 1. Awareness 2.Interest 3.Evaluation 4.Trial 5.Adoption or
rejection.
Awareness: consumer is first exposed to the product innovation
Interest: consumer is interested in the product and searches for additional information.
Evaluation : consumer decides whether or not be believe that this product or service will satisfy the
need a kind of mental trials.
Trial : consumer uses the product or a limited basis.
Adoption or Rejection : if trial is favourable the consumer decides to use the product or a full basis.
If unfavourable, decides to reject it.
An Enhanced Adoption Process Model
76
Adoption or Rejection
Preexisting problem or need

Awareness
Interest
Evaluation
Trial
Postadaption
or Postpurchase E
Adopt
Evaluation
Discontinuation
Rejection
Discontinuation or Rejection
Why is the Adoption Process of any relevance to advertisers? The purpose of marketing and
advertising is to increase sells, which hopefully results in increased profits. It is through analyzing
and understanding the adoption process that social scientists, marketers and advertisers are able
to develop a fully integrated marketing and communication plan focused at a predetermined stage
of the adoption process.
Rejection and Discontinuance Of course, as Rogers points out, an innovation may be rejected
during any stage of the adoption process. Rogers defines rejection as a decision not to adopt an
innovation. Rejection is not to be confused from discontinuance. Discontinuance is a rejection that
occurs after adoption of the innovation.
Rogers identifies two types of discontinuance: (1) disenchantment discontinuance - a decision to
reject an idea as a result of dissatisfaction with its performance, and (2) replacement
discontinuance - a decision to reject an idea in order to adopt a better idea.
IV. A Profile of the Consumer Innovator

Consumer innovators are identified on the basis of time elapsed after the launch or as a
specific percentage of people out of total purchasers who buy early. Consumer innovators are
venturesome, young, highly educated, high status and income individuals, who have an interest in
new products and seek variety in life. They have low risk perception and have a positive attitude
towards change. They are very sociable and in the role of opinion leaders and market mavens, they
can be quite influential Consumer innovation can be defined as the relatively small group of
consumers who are the earliest purchasers of a new product.
Comparative profile of a consumer innovator and non innovator or later adopter
Characteristics
Product interest
Personality
Dogmatism
Social character
Need of social uniqueness
Optimum stimulation level
Variety seeking
Innovator
More
Non-innovator
Less
Open-Minded
Inner-Directed
Higher
Higher
Higher
Close Minded
Other Directed
Lower
Lower
Lower
77
Perceived risk
Venturesome
Purchase and consumption traits
Brand loyalty
Deal proneness
Usage
Media habits
Total magazine exposure
Special interest magazine
Television
Social characteristics
Social integration
Social striving
Group memberships
Demographic characteristics
Age
Income
Education
Occupational status
Less
More
More
Less
Less
More
More
More
Less
Less
More
More
More
Less
Less
Less
More
More
More
Less
Less
Less
Younger
Higher
More
Higher
Older
Lower
Less
Lower
IV. Consumer Behaviour Applications for Profit and Not - For - Profit organization
(Study Material)
78

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Consumer Behaviour

Debasis Pani, Asst. Professor, GIACR

I. Nature of Consumer Behaviour

As consumer behaviour is a subset of human

II. Scope of Consumer Behaviour

Debasis Pani, Asst. Professor, GIACR

III. Consumer Decision Making

Levels of Consumer Decision Making

A Model of Consumer Decision Making

FIRMS MARKETING EFFORTS

Debasis Pani, Asst. Professor, GIACR

Consumer Decision Rules (Choice Heuristic)

Debasis Pani, Asst. Professor, GIACR

Debasis Pani, Asst. Professor, GIACR

V. Consumer Decision Making Process

VI. Factors Influencing Consumer Decision Making Process

{1} Cultural Factors:

{4} Psychological Factors:

VI. Comprehensive Models of Consumer Decision Making: Nicosia Model,

VII. Some Important Concepts {Out of Syllabus}

Decision making is complex

Roles in Consumer Decision Making

Buying Behaviour of Indian Consumer

Expected Short Question

Individual Determinants of Behaviour

The Nature of Personality

demanding instant gratification, even at the cost

Personality and Understanding Consumer Diversity

[3] Cognitive Personality Factors

Elements of Perception / Concepts of Perception

The Nature of Perception

Debasis Pani, Asst. Professor, GIACR

The perceptual process consists of many

(2) Perceptual Organisation

Jumping to Conclusionsmany people tend to jump to conclusions before examining all

Vicks Action 500

Suffering from blocked nose and

Watch slipped from hand and fell into

Mothers worried about children not taking

You need to take a double

Ariel micro shine

Husband has to wash a pile of dirty

Structural Models of Attitude

[B] Multi-attribute Models

Beliefs that the behaviour leads to certain outcomes

Judgment about Ad (Cognition)

Feeling from the Ad (Affect)

Beliefs about the Brand

Attitude towards the Ad

Attitude towards the brand

Attitude Change Strategies

I. The Elements of Consumer Learning

II Behavioural Learning Theories

Unconditioned Stimulus (Meat Paste)

AFTER REPEATED PAIRING

Debasis Pani, Asst. Professor, GIACR

Conditioned Response (Salivation)

In a consumer behavior context, an unconditioned stimulus might consist of a well-known brand

2. Instrumental conditioning theory is more helpful in explaining complex, goal directed

Unrewarded: Legs too loose

Unrewarded: Tight in seat

Unrewarded: Baggy in seat

Reward: Perfect fit

Customer satisfaction (Reinforcement): the objective of all marketing efforts should be to