Lecture notes Consumer Behavior

how consumer behavior influences an organization and how advertising influences consumer behavior. how does consumer behavior affect marketing. pdf free downlaod
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Published Date:17-07-2017
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Chapter 3 Consumer Behavior: How People Make Buying Decisions Why do you buy the things you do? How did you decide to go to the college you’re attending? Where do like to shop and when? Do your friends shop at the same places or different places? Marketing professionals want to know the answers to these questions. They know that once they do have those answers, they will have a much better chance of creating and communicating about products that you and people like you will want to buy. That’s what the study of consumer behavior is all about. Consumer behavior considers the many reasons why—personal, situational, psychological, and social—people shop for products, buy and use them, and then dispose of them. Companies spend billions of dollars annually studying what makes consumers “tick.” Although you might not like it, Google, AOL, and Yahoo monitor your Web patterns—the sites you search, that is. The companies that pay for search advertising, or ads that appear on the Web pages you pull up after doing an online search, want to find out what kind of things you’re interested in. Doing so allows these companies to send you popup ads and coupons you might actually be interested in instead of ads and coupons for products such as Depends or Viagra. Massachusetts Institute of Technology (MIT), in conjunction with a large retail center, has tracked consumers in retail establishments to see when and where they tended to dwell, or stop to look at merchandise. How was it done? By tracking the position of the consumers’ mobile phones as the phones automatically transmitted signals to cellular towers. MIT found that when people’s 1 “dwell times” increased, sales increased, too. Saylor URL: http://www.saylor.org/courses/bus203 Saylor.org 1 Researchers have even looked at people’s brains by having them lie in scanners and asking them questions about different products. What people say about the products is then compared to what their brains scans show—that is, what they are really thinking. Scanning people’s brains for marketing purposes might sound nutty. But maybe not when you consider the fact is that eight out of ten new consumer products fail, even when they are test marketed. Could it be that what people say about potentially new products and what they think about them are different? 2 Marketing professionals want to find out. Studying people’s buying habits isn’t just for big companies, though. Even small businesses and entrepreneurs can study the behavior of their customers with great success. For example, by figuring out what zip codes their customers are in, a business might determine where to locate an additional store. Customer surveys and other studies can also help explain why buyers purchased what they did and what their experiences were with a business. Even small businesses such as restaurants use coupon codes. For example, coupons sent out in newspapers are given one code. Those sent out via the Internet are given another. Then when the coupons are redeemed, the restaurants can tell which marketing avenues are having the biggest effect on their sales. Some businesses, including a growing number of startups, are using blogs and social networking Web sites to gather information about their customers at a low cost. For example, Proper Cloth, a company based in New York, has a site on the social networking site Facebook. Whenever the company posts a new bulletin or photos of its clothes, all its Facebook “fans” automatically receive the information on their own Facebook pages. “We want to hear what our customers have to say,” says Joseph Skerritt, the young MBA graduate who founded Proper Cloth. “It’s useful to us and 3 lets our customers feel connected to Proper Cloth.” Skerritt also writes a blog for the company. Twitter and podcasts that can be downloaded from iTunes are two other ways companies are 4 amplifying the “word of mouth” about their products. 1 “The Way the Brain Buys,” Economist, December 20, 2009, 105–7. Saylor URL: http://www.saylor.org/courses/bus203 Saylor.org 2 2 “The Way the Brain Buys,” Economist, December 20, 2009, 105–7. 3 Rebecca Knight, “Custom-made for E-tail Success,” Financial Times, March 18, 2009, 10. 4 Rebecca Knight, “Custom-made for E-tail Success,” Financial Times, March 18, 2009, 10. 3.1 The Consumer’s Decision-Making Process L E A R N I N G O B JE C T I V E S 1. Understand what the stages of the buying process are. 2. Distinguish between low-involvement buying decisions and high-involvement buying decisions. You’ve been a consumer with purchasing power for much longer than you probably realize— since the first time you were asked which cereal or toy you wanted. Over the years, you’ve developed a systematic way you choose among alternatives, even if you aren’t aware of it. Other consumers follow a similar process. The first part of this chapter looks at this process. The second part looks at the situational, psychological, and other factors that affect what, when, and how people buy what they do. Keep in mind, however, that different people, no matter how similar they are, make different purchasing decisions. You might be very interested in purchasing a Smart Car. But your best friend might want to buy a Ford 150 truck. Marketing professionals understand this. They don’t have unlimited budgets that allow them to advertise in all types of media to all types of people, so what they try to do is figure out trends among consumers. Doing so helps them reach the people most likely to buy their products in the most cost effective way possible. Stages in the Buying Process Figure 3.2 "Stages in the Consumer’s Purchasing Process" outlines the buying stages consumers go through. At any given time, you’re probably in some sort of buying stage. You’re thinking about Saylor URL: http://www.saylor.org/courses/bus203 Saylor.org 3 the different types of things you want or need to eventually buy, how you are going to find the best ones at the best price, and where and how will you buy them. Meanwhile, there are other products you have already purchased that you’re evaluating. Some might be better than others. Will you discard them, and if so, how? Then what will you buy? Where does that process start? Figure 3.2 Stages in the Consumer’s Purchasing Process Stage 1. Need Recognition Perhaps you’re planning to backpack around the country after you graduate, but you don’t have a particularly good backpack. Marketers often try to stimulate consumers into realizing they have a need for a product. Do you think it’s a coincidence that Gatorade, Powerade, and other beverage makers locate their machines in gymnasiums so you see them after a long, tiring workout? Previews at movie theaters are another example. How many times have you have heard about a movie and had no interest in it—until you saw the preview? Afterward, you felt like had to see it. Stage 2. Search for Information Saylor URL: http://www.saylor.org/courses/bus203 Saylor.org 4 Maybe you have owned several backpacks and know what you like and don’t like about them. Or, there might be a particular brand that you’ve purchased in the past that you liked and want to purchase in the future. This is a great position for the company that owns the brand to be in— something firms strive for. Why? Because it often means you will limit your search and simply buy their brand again. If what you already know about backpacks doesn’t provide you with enough information, you’ll probably continue to gather information from various sources. Frequently people ask friends, family, and neighbors about their experiences with products. Magazines such as Consumer Reports or Backpacker Magazine might also help you. Internet shopping sites such as Amazon.com have become a common source of information about products. Epinions.com is an example of consumer-generated review site. The site offers product ratings, buying tips, and price information. Amazon.com also offers product reviews written by consumers. People prefer “independent” sources such as this when they are looking for product information. However, they also often consult nonneutral sources of information, such advertisements, brochures, company Web sites, and salespeople. Stage 3. Product Evaluation Obviously, there are hundreds of different backpacks available to choose from. It’s not possible for you to examine all of them. (In fact, good salespeople and marketing professionals know that providing you with too many choices can be so overwhelming, you might not buy anything at all.) Consequently, you develop what’s called evaluative criteria to help you narrow down your choices. Evaluative criteria are certain characteristics that are important to you such as the price of the backpack, the size, the number of compartments, and color. Some of these characteristics are more important than others. For example, the size of the backpack and the price might be more important to you than the color—unless, say, the color is hot pink and you hate pink. Saylor URL: http://www.saylor.org/courses/bus203 Saylor.org 5 Marketing professionals want to convince you that the evaluative criteria you are considering reflect the strengths of their products. For example, you might not have thought about the weight or durability of the backpack you want to buy. However, a backpack manufacturer such as Osprey might remind you through magazine ads, packaging information, and its Web site that you should pay attention to these features—features that happen to be key selling points of its backpacks. Stage 4. Product Choice and Purchase Stage 4 is the point at which you decide what backpack to purchase. However, in addition to the backpack, you are probably also making other decisions at this stage, including where and how to purchase the backpack and on what terms. Maybe the backpack was cheaper at one store than another, but the salesperson there was rude. Or maybe you decide to order online because you’re too busy to go to the mall. Other decisions, particularly those related to big ticket items, are made at this point. If you’re buying a high-definition television, you might look for a store that will offer you credit or a warranty. Stage 5. Postpurchase Use and Evaluation At this point in the process you decide whether the backpack you purchased is everything it was cracked up to be. Hopefully it is. If it’s not, you’re likely to suffer what’s called postpurchase dissonance. You might call it buyer’s remorse. You want to feel good about your purchase, but you don’t. You begin to wonder whether you should have waited to get a better price, purchased something else, or gathered more information first. Consumers commonly feel this way, which is a problem for sellers. If you don’t feel good about what you’ve purchased from them, you might return the item and never purchase anything from them again. Or, worse yet, you might tell everyone you know how bad the product was. Companies do various things to try to prevent buyer’s remorse. For smaller items, they might offer a money back guarantee. Or, they might encourage their salespeople to tell you what a great purchase you made. How many times have you heard a salesperson say, “That outfit looks so Saylor URL: http://www.saylor.org/courses/bus203 Saylor.org 6 great on you”? For larger items, companies might offer a warranty, along with instruction booklets, and a toll-free troubleshooting line to call. Or they might have a salesperson call you to see if you need help with product. Stage 6. Disposal of the Product There was a time when neither manufacturers nor consumers thought much about how products got disposed of, so long as people bought them. But that’s changed. How products are being disposed is becoming extremely important to consumers and society in general. Computers and batteries, which leech chemicals into landfills, are a huge problem. Consumers don’t want to degrade the environment if they don’t have to, and companies are becoming more aware of the fact. Take for example, Crystal Light, a water-based beverage that’s sold in grocery stores. You can buy it in a bottle. However, many people buy a concentrated form of it, put it in reusable pitchers or bottles, and add water. That way, they don’t have to buy and dispose of plastic bottle after plastic bottle, damaging the environment in the process. Windex has done something similar with its window cleaner. Instead of buying new bottles of it all the time, you can purchase a concentrate and add water. You have probably noticed that most grocery stores now sell cloth bags consumers can reuse instead of continually using and discarding of new plastic or paper bags. Other companies are less concerned about conservation than they are about planned obsolescence. Planned obsolescence is a deliberate effort by companies to make their products obsolete, or unusable, after a period of time. The goal is to improve a company’s sales by reducing the amount of time between the repeat purchases consumers make of products. When a software developer introduces a new version of product, older versions of it are usually designed to be incompatible with it. For example, not all the formatting features are the same in Microsoft Word 2003 and 2007. Sometimes documents do not translate properly when opened in the newer Saylor URL: http://www.saylor.org/courses/bus203 Saylor.org 7 version. Consequently, you will be more inclined to upgrade to the new version so you can open all Word documents you receive. Products that are disposable are another way in which firms have managed to reduce the amount of time between purchases. Disposable lighters are an example. Do you know anyone today that owns a nondisposable lighter? Believe it or not, prior to the 1960s, scarcely anyone could have imagined using a cheap disposable lighter. There are many more disposable products today than there were in years past—including everything from bottled water and individually wrapped snacks to single-use eye drops and cell phones. Low-Involvement versus High-Involvement Buying Decisions Consumers don’t necessarily go through all the buying stages when they’re considering purchasing product. You have probably thought about many products you want or need but never did much more than that. At other times, you’ve probably looked at dozens of products, compared them, and then decided not to purchase any one of them. At yet other times, you skip stages 1 through 3 and buy products on impulse. As Nike would put, you “just do it.” Perhaps you see a magazine with Angelina Jolie and Brad Pitt on the cover and buy it on the spot simply because you want it. Purchasing a product with no planning or forethought is called impulse buying. Impulse buying brings up a concept called level of involvement—that is, how personally important or interested you are in consuming a product. For example, you might see a roll of tape at a check-out stand and remember you need one. Or you might see a bag of chips and realize you’re hungry. These are items you need, but they are low-involvement products. Low-involvement products aren’t necessarily purchased on impulse, although they can be. Low-involvement products are, however, inexpensive and pose a low risk to the buyer if she makes a mistake by purchasing them. Saylor URL: http://www.saylor.org/courses/bus203 Saylor.org 8 Consumers often engage in routine response behavior when they buy low-involvement products—that is, they make automatic purchase decisions based on limited information or information they have gathered in the past. For example, if you always order a Diet Coke at lunch, you’re engaging in routine response behavior. You may not even think about other drink options at lunch because your routine is to order a Diet Coke, and you simply do it. If you’re served a Diet Coke at lunchtime, and it’s flat, oh well. It’s not the end of the world. By contrast, high-involvement products carry a high risk to buyers if they fail, are complex, or have high price tags. A car, a house, and an insurance policy are examples. These items are not purchased often. Buyers don’t engage in routine response behavior when purchasing high-involvement products. Instead, consumers engage in what’s called extended problem solving, where they spend a lot of time comparing the features of the products, prices, warrantees, and so forth. High-involvement products can cause buyers a great deal of postpurchase dissonance if they are unsure about their purchases. Companies that sell high-involvement products are aware of that postpurchase dissonance can be a problem. Frequently, they try to offer consumers a lot of information about their products, including why they are superior to competing brands and how they won’t let the consumer down. Salespeople are typically utilized to do a lot of customer “hand-holding.” Limited problem solving falls somewhere in the middle. Consumers engage in limited problem solving when they already have some information about a good or service but continue to search for a bit more information. The backpack you’re looking to buy is an example. You’re going to spend at least some time looking for one that’s decent because you don’t want it to fall apart while you’re traveling and dump everything you’ve packed on a hiking trail. You might do a little research online and come to a decision relatively quickly. You might consider the choices available at your favorite retail outlet but not look at every Saylor URL: http://www.saylor.org/courses/bus203 Saylor.org 9 backpack at every outlet before making a decision. Or, you might rely on the advice of a person you know who’s knowledgeable about backpacks. In some way you shorten the decision-making process. Brand names can be very important regardless of the consumer’s level of purchasing involvement. Consider a low- versus high-involvement product—say, purchasing a tube of toothpaste versus a new car. You might routinely buy your favorite brand of toothpaste, not thinking much about the purchase (engage in routine response behavior), but not be willing to switch to another brand either. Having a brand you like saves you “search time” and eliminates the evaluation period because you know what you’re getting. When it comes to the car, you might engage in extensive problem solving but, again, only be willing to consider a certain brands or brands. For example, in the 1970s, American-made cars had such a poor reputation for quality, buyers joked that a car that’s “not Jap Japanese made is crap.” The quality of American cars is very good today, but you get the picture. If it’s a high-involvement product you’re purchasing, a good brand name is probably going to be very important to you. That’s why the makers of high-involvement products can’t become complacent about the value of their brands. K E Y T A K E A W A Y Consumer behavior looks at the many reasons why people buy things and later dispose of them. Consumers go through distinct buying phases when they purchases products: (1) realizing the need or want something, (2) searching for information about the item, (3) evaluating different products, (4) choosing a product and purchasing it, (5) using and evaluating the product after the purchase, and (6) disposing of the product. A consumer’s level of involvement is how interested he or she is in buying and consuming a product. Low-involvement products are usually inexpensive and pose a low risk to the buyer if she makes a mistake by purchasing them. High-involvement products carry a high Saylor URL: http://www.saylor.org/courses/bus203 Saylor.org 10 risk to the buyer if they fail, are complex, or have high price tags. Limited-involvement products fall somewhere in between. R E V I E W Q U E S T I ON S 1. What is consumer behavior? Why do companies study it? 2. What stages do people go through in the buying process? 3. How do low-involvement products differ from high-involvement products in terms of the risks their buyers face? Name some products in each category that you’ve recently purchased. 3.2 Situational Factors That Affect People’s Buying Behavior L E A R N I N G O B JE C T I V E S 1. Describe the situational factors that affect what consumers buy and when. 2. Explain what marketing professionals can do to make situational factors work to their advantage. Situational influences are temporary conditions that affect how buyers behave—whether they actually buy your product, buy additional products, or buy nothing at all from you. They include things like physical factors, social factors, time factors, the reason for the buyer’s purchase, and the buyer’s mood. You have undoubtedly been affected by all these factors at one time or another. Because businesses very much want to try to control these factors, let’s now look at them in more detail. Saylor URL: http://www.saylor.org/courses/bus203 Saylor.org 11 The Consumer’s Physical Situation Have you ever been in a department story and couldn’t find your way out? No, you aren’t necessarily directionally challenged. Marketing professionals take physical factors such as a store’s design and layout into account when they are designing their facilities. Presumably, the longer you wander around a facility, the more you will spend. Grocery stores frequently place bread and milk products on the opposite ends of the stores because people often need both types of products. To buy both, they have to walk around an entire store, which of course, is loaded with other items they might see and purchase. Store locations are another example of a physical factor. Starbucks has done a good job in terms of locating its stores. It has the process down to a science; you can scarcely drive a few miles down the road without passing a Starbucks. You can also buy cups of Starbucks coffee at many grocery stores and in airports—virtually any place where there is foot traffic. Physical factors like these—the ones over which firms have control—are called atmospherics. In addition to store locations, they include the music played at stores, the lighting, temperature, and even the smells you experience. Perhaps you’ve visited the office of an apartment complex and noticed how great it looked and even smelled. It’s no coincidence. The managers of the complex were trying to get you to stay for a while and have a look at their facilities. Research shows that “strategic fragrancing” results in customers staying in stores longer, buying more, and leaving with better impression of the quality of stores’ services and products. Mirrors near hotel elevators are another example. Hotel operators have found that when people are busy looking at themselves 1 in the mirrors, they don’t feel like they are waiting as long for their elevators. Not all physical factors are under a company’s control, however. Take weather, for example. Rain and other types of weather can be a boon to some companies, like umbrella makers such as London Fog, but a problem for others. Beach resorts, outdoor concert venues, and golf courses Saylor URL: http://www.saylor.org/courses/bus203 Saylor.org 12 suffer when the weather is rainy. So do a lot of retail organizations—restaurants, clothing stores, and automobile dealers. Who wants to shop for a car in the rain or snow? Firms often attempt to deal with adverse physical factors such as bad weather by making their products more attractive during unattractive times. For example, many resorts offer consumers discounts to travel to beach locations during hurricane season. Having an online presence is another way to cope with weather-related problems. What could be more comfortable than shopping at home? If it’s too cold and windy to drive to the GAP, REI, or Abercrombie & Fitch, you can buy these companies’ products online. You can shop online for cars, too, and many restaurants take orders online and deliver. Crowding is another situational factor. Have you ever left a store and not purchased anything because it was just too crowded? Some studies have shown that consumers feel better about retailers who attempt to prevent overcrowding in their stores. However, other studies have shown that to a certain extent, crowding can have a positive impact on a person’s buying experience. The phenomenon is often referred to as “herd behavior.” If people are lined up to buy something, you want to know why. Should you get in line to buy it too? Herd behavior helped drive up the price of houses in the mid-2000s before the prices for them rapidly fell. Unfortunately, herd behavior has also led to the deaths of people. In 2008, a store employee was trampled to death by an early morning crowd rushing into a Walmart to snap up holiday bargains. To some extent, how people react to crowding depends on their personal tolerance levels. Which rock concert would you rather attend: A sold-out concert in which the crowd is having a rocking good time? Or a half-sold-out concert where you can perhaps move to a seat closer to the stage 2 and not have to stand in line at the restrooms? The Consumer’s Social Situation Saylor URL: http://www.saylor.org/courses/bus203 Saylor.org 13 The social situation you’re in can significantly affect what you will buy, how much of it, and when. Perhaps you have seen Girl Scouts selling cookies outside grocery stores and other retail establishments and purchased nothing from them. But what if your neighbor’s daughter is selling the cookies? Are you going to turn her down, or be a friendly neighbor and buy a box (or two)? Companies like Avon and Tupperware that sell their products at parties understand that the social situation you’re in makes a difference. When you’re at a Tupperware party a friend is having, you don’t want to disappoint her by not buying anything. Plus, everyone at the party will think you’re cheap. Certain social situations can also make you less willing to buy products. You might spend quite a bit of money each month eating at fast-food restaurants like McDonald’s and Subway. But suppose you’ve got a hot first date? Where do you take your date? Some people might take a first date to Subway, but that first date might also be the last. Other people would perhaps choose a restaurant that’s more upscale. Likewise, if you have turned down a drink or dessert on a date because you were worried about what the person you were with might have thought, your 3 consumption was affected by your social situation. The Consumer’s Time Situation The time of day, the time of year, and how much time consumers feel like they have to shop also affects what they buy. Researchers have even discovered whether someone is a “morning person” or “evening person” affects shopping patterns. Seven-Eleven Japan is a company that’s extremely in tune to physical factors such as time and how it affects buyers. The company’s point-of-sale systems at its checkout counters monitor what is selling well and when, and stores are restocked with those items immediately—sometimes via motorcycle deliveries that zip in and out of traffic along Japan’s crowded streets. The goal is to get the products on the shelves when and where consumers want them. Seven-Eleven Japan also knows that, like Americans, its customers are “time starved.” Shoppers can pay their utility bills, local taxes, and insurance or pension 4 premiums at Seven-Eleven Japan stores, and even make photocopies. Saylor URL: http://www.saylor.org/courses/bus203 Saylor.org 14 Companies worldwide are aware of people’s lack of time and are finding ways to accommodate them. Some doctors’ offices offer drive-through shots for patients who are in a hurry and for elderly patients who find it difficult to get out of their cars. Tickets.com allows companies to sell tickets by sending them to customers’ mobile phones when they call in. The phones’ displays are then read by barcode scanners when the ticket purchasers arrive at the events they’re attending. Likewise, if you need customer service from Amazon.com, there’s no need to wait on hold on the telephone. If you have an account with Amazon, you just click a button on the company’s Web site and an Amazon representative calls you immediately. The Reason for the Consumer’s Purchase The reason you are shopping also affects the amount of time you will spend shopping. Are you making an emergency purchase? Are you shopping for a gift? In recent years, emergency clinics have sprung up in strip malls all over the country. Convenience is one reason. The other is sheer necessity. If you cut yourself and you are bleeding badly, you’re probably not going to shop around much to find the best clinic to go to. You will go to the one that’s closest to you. What about shopping for a gift? Purchasing a gift might not be an emergency situation, but you might not want to spend much time shopping for it either. Gift certificates have been a popular way to purchase for years. But now you can purchase them as cards at your corner grocery store. By contrast, suppose you need to buy an engagement ring. Sure, you could buy one online in a jiffy, but you probably wouldn’t, because it’s a high-involvement product. What if it were a fake? How would you know until after you purchased it? What if your significant other turned you down 5 and you had to return the ring? How hard would it be to get back online and return the ring? The Consumer’s Mood Have you ever felt like going on a shopping spree? At other times wild horses couldn’t drag you to a mall. People’s moods temporarily affect their spending patterns. Some people enjoy shopping. Saylor URL: http://www.saylor.org/courses/bus203 Saylor.org 15 It’s entertaining for them. At the extreme are compulsive spenders who get a temporary “high” from spending. A sour mood can spoil a consumer’s desire to shop. The crash of the U.S. stock market in 2008 left many people feeling poorer, leading to a dramatic downturn in consumer spending. Penny pinching came into vogue, and conspicuous spending was out. Costco and Walmart experienced heightened sales of their low-cost Kirkland Signature and Great Value brands as consumers 6 scrimped. Saks Fifth Avenue wasn’t so lucky. Its annual release of spring fashions usually leads to a feeding frenzy among shoppers, but spring 2009 was different. “We’ve definitely seen a drop-off of this idea of shopping for entertainment,” says Kimberly Grabel, Saks Fifth Avenue’s senior vice 7 president of marketing. To get buyers in the shopping mood, companies resorted to different measures. The upscale retailer Neiman Marcus began introducing more midpriced brands. By studying customer’s loyalty cards, the French hypermarket Carrefour hoped to find ways to get its customers to purchase nonfood items that have higher profit margins. The glum mood wasn’t bad for all businesses though. Discounters like Half-Priced books saw their sales surge. So did seed sellers as people began planting their own gardens. Finally, those products you see being hawked on television? Aqua Globes, Snuggies, and Ped Eggs? Their sales were the best ever. Apparently, consumers too broke to go to on vacation or shop at Saks were 8 instead watching television and treating themselves to the products. K E Y T A K E A W A Y Situational influences are temporary conditions that affect how buyers behave. They include physical factors such as a store’s buying locations, layout, music, lighting, and even smells. Companies try to Saylor URL: http://www.saylor.org/courses/bus203 Saylor.org 16 make the physical factors in which consumers shop as favorable as possible. If they can’t, they utilize other tactics such as discounts. The consumer’s social situation, time situation, the reason for their purchases, and their moods also affect their buying behavior. R E V I E W Q U E S T I ON S 1. Why and how does the social situation the consumer is in play a role in behavior? 2. Outline the types of physical factors companies try to affect and how they go about it. 3. What social situations have you been in that affected what you purchased? 4. What types of moods and time situations are likely to affect people’s buying behavior? 1 Patricia Moore, “Smells Sell,” NZ Business, February 2008, 26–27. 2 Carol J. Gaumer and William C. Leif, “Social Facilitation: Affect and Application in Consumer Buying Situations,” Journal of Food Products Marketing 11, no. 1 (2005): 75–82. 3 Anna S. Matilla and Jochen Wirtz, “The Role of Store Environmental Stimulation and Social Factors on Impulse Purchasing,” Journal of Services Marketing 22, no. 7 (2008): 562–67. 4 Allan Bird, “Retail Industry,” Encyclopedia of Japanese Business and Management(London: Routledge, 2002), 399–400. 5 Jacob Hornik and Giulia Miniero, “Synchrony Effects on Customers’ Responses and Behaviors,” International Journal of Research in Marketing 26, no. 1 (2009): 34–40. 6 “Wal-Mart Unveils Plans for Own-Label Revamp,” Financial Times, March 17, 2009, 15. 7 Stephanie Rosenbloom (New York Times News Service), “Where Have All the Shoppers Gone?” Fort Worth Star-Telegram, March 18, 2009, 5E. 8 Alyson Ward, “Products of Our Time,” Fort Worth Star-Telegram, March 7, 2009, 1E. Saylor URL: http://www.saylor.org/courses/bus203 Saylor.org 17 3.3 Personal Factors That Affect People’s Buying Behavior L E A R N I N G O B JE C T I V E S 1. Explain how a person’s self-concept and ideal self affects what he or she buys. 2. Describe how companies market products to people based on their genders, life stages, and ages. 3. Explain how looking at the lifestyles of consumers helps firms understand what they want to purchase. The Consumer’s Personality Personality describes a person’s disposition as other people see it. The following are the “Big Five” personality traits that psychologists discuss frequently:  Openness. How open you are to new experiences.  Conscientiousness. How diligent you are.  Extraversion. How outgoing or shy you are.  Agreeableness. How easy you are to get along with.  Neuroticism. How prone you are to negative mental states. The question marketing professionals want answered is do the traits predict people’s purchasing behavior? Can companies successfully target certain products at people based on their personalities? And how do you find out what personalities they have? Are the extraverts you know wild spenders and the introverts you know penny pinchers? Maybe not. The link between people’s personalities and their buying behavior is somewhat unclear, but market researchers continue to study it. For example, some studies have shown that “sensation seekers,” or people who exhibit extremely high levels of openness, are more likely to respond well to advertising that’s violent and graphic. The practical problem for firms is figuring out “who’s who” in terms of their personalities. Saylor URL: http://www.saylor.org/courses/bus203 Saylor.org 18 The Consumer’s Self-Concept Marketers have had better luck linking people’s self-concept to their buying behavior. Your self- concept is how you see yourself—be it positive or negative. Your ideal self is how you would like to see yourself—whether it’s prettier, more popular, more eco-conscious, or more “goth.” Marketing researchers believe people buy products to enhance how they feel about themselves— to get themselves closer to their ideal selves, in other words. The slogan “Be All That You Can Be,” which for years was used by the U.S. Army to recruit soldiers, is an attempt to appeal to the self- concept. Presumably, by joining the U.S. Army, you will become a better version of yourself, which will, in turn, improve your life. Many beauty products and cosmetic procedures are advertised in a way that’s supposed to appeal to the ideal selves people are searching for. All of us want products that improve our lives. The Consumer’s Gender Everyone knows that men and women buy different products. Physiologically speaking, they simply need different product—different underwear, shoes, toiletries, and a host of other 1 products. Men and women also shop differently. One study by Resource Interactive, a technology research firm, found that when shopping online, men prefer sites with lots of pictures of products; women prefer to see products online in lifestyle context—say, a lamp in a living room. Women are also twice as likely as men to use viewing tools such as the zoom and rotate buttons and links that allow them to change the color of products. In general, men have a different attitude about shopping than women do. You know the old stereotypes: Men see what they a want and buy it, but women “shop ‘til they drop.” There’s some truth to the stereotypes. Otherwise, you wouldn’t see so many advertisements directed at one sex or the other—beer commercials that air on ESPN and commercials for household products that Saylor URL: http://www.saylor.org/courses/bus203 Saylor.org 19 air on Lifetime. In fact, women influence fully two-thirds of all household product purchases, 2 whereas men buy about three-quarters of all alcoholic beverages. The shopping differences between men and women seem to be changing, though. For example, younger, well-educated men are less likely to believe grocery shopping is a woman’s job. They would also be more inclined to bargain shop and use coupons if the coupons were properly 3 targeted at them. One survey found that approximately 45 percent of married men actually like shopping and consider it relaxing. Many businesses today are taking greater pains to figure out “what men want.” Products such as face toners and body washes for men, such as the Axe brand, are a relatively new phenomenon. So are hair salons such as the Men’s Zone and Weldon Barber. Some advertising agencies specialize in advertising directed at men. Keep in mind that there are also many items targeted toward women that weren’t in the past, including products such as kayaks and mountain bikes. The Consumer’s Age and Stage of Life You have probably noticed that the things you buy have changed as you age. When you were a child, the last thing you probably wanted as a gift was clothing. As you became a teen, however, cool clothes probably became a bigger priority. Don’t look now, but depending on the stage of life you’re currently in, diapers and wrinkle cream might be just around the corner. Companies understand that people buy different things based on their ages and life stages. Aging baby boomers are a huge market that companies are trying to tap. Ford and other car companies have created “aging suits” for young employees to wear when they’re designing 4 automobiles. The suit simulates the restricted mobility and vision people experience as they get older. Car designers can then figure out how to configure the automobiles to better meet the needs of these consumers. Saylor URL: http://www.saylor.org/courses/bus203 Saylor.org 20

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