MKTG chapter 6

• The consumer decision-making process model represents the steps that consumers go through before during and after making purchases.

• Need recognition- the consumer decision process begins with consumers recognize they have an unsatisfied need and they would like to go from their actual needy state to a different desired state. The greater the discrepancy between these two states the greater the need recognition will be • Functional needs- pertains to the performance of a product or service. • Psychological needs- pertains to the personal gratification consumers associate with a product and or service. Purses for instance provide a functional need to transport wallets and other personal items and keep them organized and safe.

The second step after a consumer recognizes a need is to search for information about the various options that exist to satisfy that need. The length and intensity of the search are based on the degree of perceived risk associated with purchasing the product or service.

•Internal search for information: the buyer examines his or her own memory and knowledge about the product or service gathered through past experiences.

the buyer seeks information outside his or her personal knowledge base to help make the buying decision. The internet provides information in various ways

o It is important for marketers to understand the many factors that affect consumers' search processes.

the locus of control. Believe that they have some control over the outcomes of their actions in which case they generally engage in more search activities

consumers believe that fate or other external factors control all outcomes. They believe it does not matter how much information they gather.

involves the perceived danger inherent in a poorly performing product or service

is a risk associated with a monetary outlay and incudes the initial cost of the purchase as well as the costs of using the item or service

involves the fears that consumers suffer when they worry others might not regard their purchases positively.

could also be safety risk: whereas performance risk involves what might happen if a product does not perform as expected, physiological or safety risk refers to the fear of an actual harm should the product not perform properly o Psychological risks: are those risks associated with the way people will feel if the product or service does not convey the right image.

• Once a consumer has recognized a problem and explored the possible options her or she must sift through the choices available and evaluate the alternatives. Alternative evaluation often occurs while the consumer is engaged in the process of information search. • Attribute sets: research has shown that a consumers mind organizes and categorizes alternatives to aid his or her decision processes

include all possible choices for a product category, but because it would be un widely for a person to recall all possible alternatives for every purchase decision, marketers tend to focus on only a subset of choices.

which are those brands or stores that can be readily brought forth from memory

consist of salient or important attributes about a particular product. Might consider size, price, fit etc.

are product or service features that are important to the buyer and on which competing brands or stores

is the set of criteria that consumers use consciously or subconsciously to quickly and efficiently select from among several alternatives. Either compensatory or non compensatory

assumes that the consumer which evaluating alternatives trades off one characteristic against another such that good characteristics compensate for bad characteristics. • Multi-attribute set: how a compensatory model would work. Assigning weights to the importance of each factor. And it adds up to 1.0

in which they choose a product or service on the basis of one characteristic or one subset of a characteristic regardless of the values of its other attributes.

• After evaluating the alternatives, customers are ready to buy. However they do not always patronize the store or purchase the brand or item on which they had originally decided • It may not be available at the retail store, retailers therefore turn to the conversion rate

to measure how well they have converted purchase intentions into purchases. Once method of measuring the conversion rate is the number of real or virtual abandoned carts in the retailer's store or website.

• The final step of the consumer decision process is post-purchase behavior. • Marketers are particularly interested in this because it entails actual rather than potential customers. • Satisfied customers become loyal and purchase again

o Setting unrealistically high consumer expectations of the product through advertising, personal selling, or other types of promotion may lead to higher initial sales, but it eventually will result in dissatisfaction if the product fails to achieve high performance expectations. o Build realistic expectations: not too high and low o Demonstrate correct use o Stand behind the product o Encourage customer feedback o Make contact with customers and thank them

o Post-purchase cognitive dissonance: is an internal conflict that arises from an inconsistency between two beliefs or between beliefs and behavior. o You might have buyer's remorse after purchasing an expensive TV because you question whether this high priced version offers appreciably better quality than a set of similar size but at a lower price- or whether you need a TV at all o Especially likely for products that are expensive.

marketers attempt to solidify a loyal relationship with their customers. They want customers to be satisfied with their purchase and buy from the same company again.

o Sometimes fail to attain loyal customers. Passive consumers are those who do not repeat purchase or recommend the product to others. o Negative word of mouth: occurs when consumers spread negative information about a product service or store to others. When consumers believe that they have been treated unfairly they usually want to complain to many people.

affects the way people receive messages

o Motive: is a need or want that is strong enough to cause the person to seek satisfaction

• Physiological: deal with the basic biological necessities of life, food, drink, rest and shelter. • Safety: pertain to protection and physical well being. • Love needs: relate to our interactions with others • Esteem needs: allow people to satisfy their inner desires • Self-actualization: occurs when you feel completely satisfied with your life and how you life

o Attitude: is a person's enduring evaluation of his or her feelings about and behavioral tendencies toward an object or idea. Attitudes are learned and long lasting. They might develop over a long period of time though they can also abruptly change o Cognitive component: reflects a person's belief system or what we believe to be true o Affective component: reflects what a person feels about the issue at hand- his or her like or dislike about something o Behavioral component: pertains to the actions we undertake based on what we know and feel.

o It is the process by which we select organize and interpret information to form a meaningful picture of the world.

o Refers to a change in a person's thought process or behavior that arises from experience and takes place throughout the consumer decision process.

o Refers to the way consumers spend their time and money to live o For many consumers, the question of whether the product or service fits with their actual lifestyle or their perceived lifestyle is an important one.

o Are one or more persons whom an individual uses as a basis for comparison regarding beliefs feelings and behaviors. A consumer might have various reference groups including family friends coworkers or famous people the consumer would like to emulate. 1. Offering information. 2. Providing rewards 3. Enhancing a consumer's self-image

o Shared meanings, beliefs, morals, values, and customs of a group of people. The culture or cultures in which you participate are not markedly different from your reference group. Visible artifacts and underlying values.

factors specific to the situation over-ride or at least influence psychological and social issues. These situational factors are related to the purchase and shopping situation as well as to temporal states

consumers may be predisposed to purchase certain products or services because of some underlying psychological trait or social factor, but these factors may change in certain purchase situations.

consumers might be ready to purchase a product or service but be completely derailed once they arrive in the store. • Store atmosphere • Salespeople • Crowing • In-store demonstrations • Promotions • Packaging

o Our state of mind at any particular time can alter our preconceived notions of what we are going to purchase

is the consumers' degree of interest in the product or service.

• Common when the customer perceives that the purchase decision entails a lot of risk. A purchase decision process, during which the consumer devotes considerable time and effort to analyzing alternatives, often occurs when the consumer perceives that the purchase decision entails a lot of risk.

• Occurs during a purchase decision that calls for at most a moderate amount of time and effort. • Impulse buying: a buying decision made by customers on the spot when they see the merchandise. • Habitual decision-making: a purchase decision process in which little conscious effort.

marketing mix: product price place and promotion psychological factors:motives, attitudes, perceptions, learning and lifestyles social factors: family, reference groups and culture situational factors: purchase situation, shopping situation, and temporal state