Chapter 3

1. Learning objectives: • Illustrate how a marketer should take motivation into account in his or her marketing messages • Explain the perception process and the marketing implications of perceptual defence • Explain and illustrate the nature and elements of learning • Illustrate the use of the components of attitudes and how attitudes can be changed • Explain the characteristics of personality and its value to marketers • Explain the nature of lifestyle • Explain decision-making in the family in terms of family roles and family types • Explain the different reference groups • Illustrate the types of decision-making and the decision-making process • Understand the stages of adopting a new product and the categories of adoption of new products Chapter 3 Consumer behaviour

2. Introduction • Consumer behaviour is the study of individuals, groups or organisations and the processes they use to select, secure, use and dispose of products, services, experiences or ideas to satisfy needs and the impacts that these processes have on the consumer and society. • A consumer’s buying decision is not determined by only one factor but mostly by a number of factors. • This chapter will focus on the individual and group factors that influence consumer behaviour as well as the consumer decision-making process. Figure 3.1 provides an overview of consumer behaviour.

3. Consumer behaviour Figure 3.1 Model of consumer behaviour

4. Individual factors influencing behaviour Individual factors refer to those factors which are inherent in human behaviour. 1. Motivation • Motivation is what moves people to action. • Needs are the basic sources of buyer behaviour, but they have to be stimulated before the consumer is driven to action. When a person wishes to satisfy a need we call it motivation. There is a close relationship between needs and motives. Needs lead to motives and a motive is a need sufficiently stimulated to move an individual to seek satisfaction. • Motives can be classified in various ways but the two most relevant to the marketer include:

5. Individual factors contd. • Maslow’s hierarchic classification of motives • The most basic motives start from the bottom and need to be reasonably satisfied before higher-order motives emerge. Figure 3.2 Maslow’s hierarchy of motives

6. Individual factors contd. • Economic and emotional classification of motives • Consumers are not always motivated by physiological needs in decision-making. • Customers also purchase products taking price, quality, performance and reliability into consideration. This is known as economic motives. • Emotional motives represent those motives that involve emotions and correspond with Maslow’s social and esteem motives. 2. Perception • Perception is influenced by what we have learned. The way in which we perceive things is influences by what we know about them. • The perception process • Exposure: occurs when the stimuli come in range of one of the five primary receptors (vision, hearing, taste, smell and touch). Most of the stimuli to which an individual is exposed is deliberately selected. This is known as selective exposure. • Attention: is activated when one or more of the sensory receptors are stimulated and the resulting sensations are processed in the brain. Because the individual is exposed to more stimuli than he/ she can process, the individual is selective in attending to marketing and other messages – selective attention.

7. Individual factors contd. • Interpretation: the meaning that people assign to sensory stimuli. Consumers usually interpret information on the basis of their own attitudes, beliefs, motives and experiences, known as selective interpretation. • Recall (memory): consumers do not remember all the information they hear, see or read and tend to forget the marketing message – selective recall. 3. Learning ability • Any facet of a persons behaviour is dependent on what he or she learns and remembers about objects and situations. • Elements of learning • Stimulus: the consumer can either be stimulated by physical things like products and brands or intangibles such as service and quality. • Response: is any action, reaction or state of mind which results from a particular stimulus or cue. • Reinforcement: increases the likelihood that a particular response will occur in the future as the result of particular cues or stimuli. • Repetition: the act of repeating past experiences.

8. Individual factors contd. 4. Attitudes • A learned preposition to behave in a consistently favourable way toward market-related objects, events or situations. • Components of attitudes • Cognitive component: refers to a person’s knowledge and perceptions that may be acquired by direct experience with the product and other sources of information. • Affective component: the consumer’s feelings or emotions with respect to the focus of the attitude. • Behavioural component: the outcome of the cognitive and affective components – to buy or not to buy. • Attitude change • The marketer can influence consumer attitudes by: • Increasing or changing the strength or belief rating of a brand on an important attribute. • Changing consumers’ perceptions of the value of an attribute. • Adding a new attribute to the attitude formation process. • Changing perceptions of belief ratings for a competing brand.

9. Individual factors contd. 5. Personality • Personality: those inner psychological characteristics that determine and reflect how a person responds to his/ her environment. • Characteristics of personality • Personality reflects individual differences • Personality is consistent and enduring • The value of personality to marketers • Knowledge of personality is essential for the marketer because consumers tend to buy products that reflect, enhance or defend their personalities. It also assists marketers in designing appropriate advertisements that will appeal to groups of similar personalities. 6. Lifestyle • Lifestyle refers to the way of living of individuals or families and is related to one’s values. It includes how people spend their time, what they find interesting and important and how they view themselves and the world around them.

10. Group factors influencing behaviour Consumer behaviour is strongly influenced by family, culture, social class, reference groups and opinion leaders. 1. Family • Family has a major influence on the consumer behaviour of its members. There are two levels of family: the Nuclear family comprising a husband, wife and children and the extended family which includes grandparents or other relatives who live under the same roof as the nuclear family. • FAMILY ROLES • Initiator: first to suggest that a specific product should be bought • Influencer: the person that influences the final decision • Decision maker: takes the actual decision and makes the final choice • Purchaser: person that buys the product • User: person that uses the product

11. Group factors contd. • FAMILY TYPES: Families are usually classified in terms of the dominant member – the person who makes or influences the decision: • Husband-dominant families • Wife-dominant families • Syncratic families where decisions are made jointly by husband and wife • Child-dominant families 2. Cultural group • Culture refers to the pattern of behaviour common to members of a society. Such behaviour is learned and handed down from one generation to the next. • A consumer’s culture further determines his or her overall priorities in respect of different activities and products. • A product that provides benefits consistent with those desired by members of a culture has a better chance of being accepted in the market.

12. Group factors contd. 3. Social class • These are groups who enjoy more or less the same prestige and status in society • Social class strongly influences consumer lifestyles and is a good indicator of the type of product that the consumers would be interested in. • Consumers also buy products to demonstrate their membership to a particular social class and to advance their social standing in society. • Marketing implications of social class: • Media usage: better educated individuals spend more time reading magazines etc. and spend less time watching television than the less well-educated. • Collection of information: lower social groups tend to collect less information than the other groups. Access to information is limited. • Store choice: lower-class people tend to do shopping downtown, especially at discount stores. • Leisure pursuits: high-status occupational groups prefer more active leisure pursuits. 4. Reference groups • A reference group involves one or more people that a consumer uses as a basis for comparison or “point of reference” in forming responses and performing behaviours.

13. Group factors contd. • Types of reference groups that influence consumer behaviour: • Membership groups: group to which the person has obtained membership e.g. social club • Automatic groups: group to which a person belongs as a result of age, gender or occupation. • Negative groups: group which a person does not wish to be associated e.g. drinkers • Associative groups: group which a person aspires to belong e.g. a group with higher status or acceptance level among peers. 5. Opinion leader • A reference group can also be a reference person, an individual to whom others will look in forming opinions and taking consumer decisions, this reference person can be regarded as an opinion leader.

14. Consumer decision-making process • Types of decision-making • Real decision-making: this is a complex process and involves extensive problem solving e.g. the decision to buy a new car. • Impulse decision-making: refers to unplanned action on the spur of the moment e.g. while standing in the queue, you buy a chocolate displayed in the checkout aisles. • Habitual decision-making: occurs when a consumer is loyal and buys a certain product (e.g. a large tin of Ricoffy) automatically without considering competitors. • Phases in consumer decision-making • Need-recognition: consumer becomes aware of a need. • Search for information: consumer searches for information about product. • Evaluation: consumer compares and evaluates the attributes and benefits of various alternatives. • Purchase decision: when the best alternative has been identified, the consumer makes a decision. • Post-purchase decision: the consumer re-evaluates his/ her decision and if the product fulfils all expectations, this can lead to brand loyalty.

15. Consumer decision-making process contd. • Adoption of new products The adoption process focuses on the stages through which an individual consumer passes in arriving at a decision to try or not to try, to continue using or to discontinue using a new product. Consumers usually move through the following five stages in arriving at a decision to purchase or reject the new product: • Awareness: consumers are exposed to the product innovation. They know about the new idea but lack sufficient awareness about it. • Interest: as the consumer becomes more interested in the product, he/she searches for more information about it. • Evaluation: consumers draw conclusions about the innovation and determine whether more information is necessary. If the evaluation is satisfactory then the consumer will try the product. • Trial: consumers use the product on a limited basis. • Adoption or rejection: after experience with the product, the consumer decides whether to continue using it or to reject the product.

16. Consumer decision-making process contd. • Characteristics of people who adopt an innovation at different points in time: • Innovators: venturesome, tend to be younger, better educated, make extensive use of the media and eager to try new ideas • Early adopters: well-educated and successful, willing to take a calculated risk on an innovation but are concerned with failure. • Early majority: cautious and will adopt after the innovation has proven successful with others. • Late majority: sceptical about innovations, tend to be older with less social status. They often adopt more in response to social pressure. • Laggards: more traditional and have limited social interaction. They are the last people to adopt an innovation.

17. Questions Kyle has just started high school. He notices that most of the pupils in his class, including his friends, have cell phones besides him. He realises the need to have one. • Discuss, with the use of examples, the group factors that will influence Kyle’s decision on which cell phone to purchase. (10) • Also discuss the five phases of the consumer decision-making process that Kyle will undergo. (10)