1. Issues Required to Understand Buyer BehaviorSocial Influences on Consumer BehaviorPsychological Influences on Consumer BehaviorMKT 327: CLASS TWELVE “UNDERSTANDING BUYERS PART II”Theme: “In Search of Cool”Pre-Class Tasks:1. Read Chapter Read Chapter 4: LO & LO2. Read article “Creating Customer Value” on Angel3. Complete Quiz Ten on ConnectLearning Objectives:1. Issues Required to Understand Buyer Behavior Why is it Bought – Part 1 Social InfluencesWhy is it Bought – Part 2 Psychological Influences2. Attitude Formation3. Buying ContextKey Terms:Social Influences on Consumer BehaviorCulture Sub-cultureOpinion Leaders Word of MouthSocial Class Reference GroupFamily Life Cycle Psychological Influences on Consumer BehaviorMotivationPerceptionPsychological needsMaslow's Hierarchy (Know each stage) LearningBehavioral CognitiveBrand LoyaltyAttitudesCognitive (Beliefs) Affective (Importance)Value (VALS)Types of Value:Functional/Instrumental SymbolicExperiential/Hedonic Cost/SacrificeThe data needed to understand why and how customers buy continues with dissecting the consumer decision making framing and its influences (societal and psychological) The data needed by these steps are as follows:Demographic factors influence a buyer’s cultural and societal affiliations, which in turn influence values and norms (cultural) and the span of survival needs (societal). Demographic and personal characteristics tend to influence the specific performance specs for any product or service; and then a buyers psychological profile influences their motives and selection tastes.[Make sure you know what each Demographic & Psychographic factors actually influences, for example cultural influences actually influences values and norms]Attitudes (the predisposition to act in a certain manner) are critical to the formation of marketing programs. Attitudes are formed through an individual’s Cognition (beliefs), their framework of affects (importance weights), and behavioral intentions. Each of these components are influenced by experiences, learning, and how information is processed. As stated earlier human behavior is a very complex and largely unpredictable. Never the less an admittedly simplified version of how marketers try and to influence behavior is given below. People behave (buy) for a reason. It may be a reason only theyunderstand, but it is a reason nevertheless. Those reasons can be summed up with the term value (the focus of all marketing activity). The more predisposed (positive attitude) a potential customer has towards product or service the more likely they are to buy.Sources of ValueInformationInteractionsProductEnvironmentCost/SacrificeThe article “Creating Customer Value” lists four types of value and five sources of value.The sources of value are the direct result of the physical and psychological attributes possessed by a product or service. Each potential customer has a certain number of attributes that are relevant (play some role in their decision) for their purchase. In a mathematical context, when the weight associated with one of these relevant attributes (or value of its importance) is multiplied by the belief that the attribute contributes to some perceive degree to one or more of the sources of some desired value; and then this resulting product is summed over all the relevant attributes then the magnitude of the potential customer’s attitude is determined. The various social and psychological influences impact the steps thepotential customer goes through in making the purchase decision as discussed, and also influences what attributes they deem as relevant, their relative importance (affective), their belief that an attribute provides some source of some desired value, and how they combine all of this information and behave (buying behavior) in any given context. Marketers attempt to understand all of these linkages, and reverse engineer the process. They push their basic controllable buttons (the marketing mix variables) in ways that tend to cause various social or psychological factors to influence the potential customer’s attribute set, attribute importance, attribute beliefs, and decision making behavior such that the marketer’s product or service is most likely to be