BUAD301 Exam 2 Study Guide Chapters 5 6 7 8 9 Chapter 5 Notes Final consumers and their buying behaviors 1 Consumer Behavior Why do they buy what they buy a Exploring thinking from economics psychology sociology and other behavioral disciplines b They all influence purchase situation 2 Economic Needs Affect most buying decisions a Economic buyers people who know all the facts and logically compare choices to get the greatest satisfaction from their time and money i Theory says that consumers decide what to buy based on economic needs which are concerned with marking the best use of a consumer s time and money b Economic needs i Economy of purchase or use ii Efficiency in operation or use iii Dependability in use iv Improvement of earnings v Convenience c Promotion can inform consumers about product benefits in terms of measurable factors like operating costs the length of guarantee or the time a product will save d Many firms adjust their marketing mixes for target markets that place a high value on convenience e Income affects needs i Ability to satisfy economic needs largely depends on how much money a consumer has available depends on income ii 40 of US families have an income of 50 000 iii 61 521 median income iv most income spent on food rent house payments home furnishings v discretionary income transportation and insurance what is left of income after paying taxes and paying for necessities what family s purchase of luxuries comes from f Consumer confidence affects spending vi definition of necessities varies from family to family i In a strong economic environment consumers feel confident and secure in their jobs more likely to buy more things 3 Psychological influences within an individual a Needs are the basic forces that motivate a person to do something i More basic than wants b Wants needs that are learned during a person s life c When a need is not satisfied it leads to a drive strong stimulus that encourages action to reduce a need i ii A product purchase results from a drive to satisfy some need Internal reasons behind certain behavior patters d Good marketing manager studies what consumer drives needs and wants already exist and how they can satisfy them better e Exhibit 5 4 the PSSP Hierarchy of Needs i Personal needs ii Social needs 1 Better world accomplishment fun freedom and relaxation 1 Love friendship status esteem connecting with others 2 Marketers that help people connect with others inspire positive feelings about their own brands iii Safety needs 1 Solutions protection and physical well being 2 Marketers that offer solutions to consumer problems build brand loyalty iv Physiological needs 1 Food liquid rest and sex f Perception determines what consumers see and feel i Perception 1 Selective exposure how we gather and interpret info from the world around us our eyes and minds seek out and notice only info that interest us info that conflict with previously learned attitudes and beliefs we remember only what we want to remember we screen out and modify ideas messages and 2 Selective perception 3 Selective retention g Learning determines what response is likely i Learning ii Cues iii Response iv Reinforcement a change in a person s thought processes caused by prior products signs ads and other stimuli in the environment experience reduction in the drive 1 Strengthens the relationship between the cue and the response 2 Repeated reinforcement habit occurs when the response is followed by satisfaction an effort to satisfy a drive h Many needs are culturally or socially learned i Most research says that advertising cant convince buyers of something j Attitudes relate to buying contrary to their basic attitudes i Attitude a person s point of view toward something 1 Affect the selective processes learning and the buying ecisions 1 May help shape a consumer s attitudes but don t necessarily involve a person s opinion about something ii Belief liking or disliking iii Managers who must focus how much of their brand customers will buy are particularly interest in the intention to buy 1 Attitudes are not good predictors of intention to buying attitudes and beliefs combined an outcome or event that a k Green attitudes and beliefs change marketing mixes l Changing a negative attitude is one of the most difficult job marketers face m expectation person anticipates or looks forward to n trust person i drives expectations because when people trust they expect the other the confidence a person has in the promises or actions of another party to fulfill promises or perform capably o trusted brands are less susceptibly to price based competition p psychographics or lifestyle analysis pattern of living as expressed in that person s activities interests and opinions AOI s is the analysis of a person day to day 4 Social influences affect consumer behavior a Empty nesters people whose children are grown and who are now able to b Social class a group or people who have approximately equal social position c Reference group the people to whom an individual looks when forming spend their money in other ways as viewed by others in the society attitudes about a particular topic a person who influences others i Not necessarily wealthier or better educated reasonably homogeneous set of people d Opinion leader e Culture the whole set of beliefs attitudes and ways of doing things of a f Ethnic group doesn t mean homogeneous consumers g Hispanics are the largest growing consumer group in the US h Hispanic and African American consumer groups are younger and growing faster than the white consumer group 5 Individuals are affected by the purchase situation i Foreign markets may need to be treated as separate with its own submarkets a why a consumer makes a purchase can affect buying behavior b surroundings and time affect buying behavior a Consumer decision process begins when a consumer recognizes an 6 The Consumer decisions process unsatisfied need b Exhibit 5 8 consumer problem solving i Search for info ii Identify alternatives iii Decide what factors are important iv Then evaluate products c Effort varies depending on the economic and psychological needs social d Extensive problem solving influences and purchase factors satisfy a need i Completely new purchase or important purchase when they put much effort into deciding how to e Limited problem solving f routinized response behavior when some effort is put into deciding the best way to satisfy a need i when consumers have previous