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Consumer Behaviour . Faculty : Prof . Ashok Kumar . Syllabus : As prescribed in the curriculum Core text books : 1 Consumer behaqviour K.K Srivatsava & Sujata K. 2 Consumer behaqviour Leon G Schiffman & L.L Kanuk

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slide1

Consumer Behaviour

Faculty : Prof . Ashok Kumar

Not for circulation : for internal use only

slide2

Syllabus : As prescribed in the curriculum

Core text books : 1 Consumer behaqviour

K.K Srivatsava & Sujata K.

2 Consumer behaqviour

Leon G Schiffman & L.L Kanuk

3 Consumer Behaviour & market Research Suja R Nair

4 Consumer behaqviour

Dr S.L Gupta & Sumitra Pal

Not for circulation : for internal use only

slide3

Consumer Power & Shifting trend in business

  • Consumer to TRANSUMER, PROSUMER
  • Create MASSCLUSIVITY - Create exclusivity from the mass.
  • Ten Hard facts of Business :
  • Consumers have more options in the market to choose.
  • Market transformed from a sellers market to buyer’s market long ago.
  • Premium & niche brands are fighting for their growth in the market
  • Consumer loyalty has vanished in thin air.
  • Business community likes to call Consumers , a transumer .

Not for circulation : for internal use only

slide4

The center of all business a “Consumer” has been transforming rapidly & have become more opaque .

Consumer consistently demand value from the products & services .

The marketer believes that brand is most important to a consumer .

A consumer is exposed to 600 market communication a day approximately. ( Research results )

A consumer looks beyond the basic functionality of products & services which he does not articulate.

Not for circulation : for internal use only

slide5

Why to study consumer behaviour by an organization

Build / Create Dominating or

self expressive brands.

Integrated Market Communication

Plans & strategies

Consumer Behaviour &

Research

CP=BP = Ever lasting brands

Not for circulation : for internal use only

slide6

Customer Value & Purchase Involvement

Value drives satisfaction

Satisfaction is a necessary condition for customer loyalty, but not a sufficient to create loyal customers, customer excellence & delight

Delivering value to the customers is a key to achieving organizational goals by being more effective than its competitors in creating , delivering & communicating customer value to the identified set of consumers in the market

What is value?

Value = Benefits ( Functional Benefit + Emotional Benefit)

Cost ( Monetary +Time+ Energy+ Psychic Cost)

What is customer delivered value ( CDV) ?

It is a difference between Total Customer Value( TCV) & Customer’s Total Cost ( CTC)

Not for circulation : for internal use only

slide7

Determinants of CDV

Monitory

cost

Time

Cost

Psychic

cost

Energy

Cost

CTC

CDV

Product

value

Service

Value

Emotional Value

Image

Value

TCV

CDV builds customer delight It is a difference between the perceived performance ( Out come ) & expectation.

If the performance falls short of expectation, it leads to dissatisfaction. On the other hand if it matches the expectation it leads to satisfaction.

When it exceeds expectation, it becomes Customer delight .

Not for circulation : for internal use only

slide8

Conclusion :

  • Add value to your customer.
  • Drive the customer up the value chain continuously
  • Customer understandsvalue for money better than any thing.
  • Need of a consumer is never ending . Identify the unstated needs residing deep into the minds of the consumer , translate it in to a value proposition , communicate & deliver before your competition does it.
  • In the media cluttered market , it is critical for every marketer to perform the mind set segmentation of their consumer to understand , how his brand is linked to his consumer.
  • Media research Co.

Not for circulation : for internal use only

slide9

Consumer behavior study help to probe the deep recesses of the consumer mind where the needs are still not articulated. It helps to get deeper in to the minds to get more insight & angles. It subliminally make the consumer like the product & services & creates a desire to buy the same. .

It helps to build a life time customer value for the organization, which is an intangible asset

Life time Customer = Profit X Frequency X Retention period

Value of Purchase

Not for circulation : for internal use only

slide10

Consumer Types

Personal consumer

Organizational Consumer

Buys for individual Consumption.

Buying decisions are influenced by

Cognitive, Personal, cultural ,social

Influence, Situational

factors

Buying fororganizational consumption

Buying decisions are influenced by

Quality , service , attitude of the suppliers

Financial considerations etc . Besides this ,

Environmental , organizational, interpersonal

Factors influence the decisions.

The buying decision involves four decision

Makers. End User, Influencer, Decision

makers ( management ) & commercial

Buyer.

Satisfaction of all our groups is essential

Not for circulation : for internal use only

slide11

Consumer types according to loyalty

Personal consumer & Business Consumer

SolusUsers

Dual users

Flirts

Degree of commitment towards product or service brands.

High Medium Low

Not for circulation : for internal use only

slide12

Influencing buying decision in a consumer

Feedback

Cognitive factor

Individual

factor

CONSUMER

Decision

making

Response

Personal

characteristics

Environmental

factor

Culture Social class Influence group Situational

variable

Not for circulation : for internal use only

slide13

Buyer’s characteristics are influenced by

Cognitive Personal cultural social Influence Situational

factors factors factor factor groups variables

Perception Demographics Values Social Reference point of

& class groups purchase

Attitudes Life style Belief & Structure Family Market

communication

Motives Personality Cross Societal Opinion leaders Display

& Need traits cultural belonging Innovation Store

Influences & trend Patronage

Self conceptSub cultural setters Price

influences

All above factors influence a consumer’s buying decision.

Not for circulation : for internal use only

slide14

Consumer’s behavior is studied from the point of view of :

1.Consumer as an individual :Consumer behavior study as in individual involves motivational drive ,its measurement , needs & wants & types of need . Self concept, attitude , perception, consumer imagery

2Consumer in his social & cultural setting : It involves cultural influence, sub culture , cross culture , ( nationality, religion , etc ) psychographic [ life style ] , Social group, reference group , geo demographic clustering etc.

Not for circulation : for internal use only

slide15

Socio -Cultural trend.

A set of beliefs & standards followed by a group of people . It is a sum of conscious & un conscious values , ideas, attitudes & symbols that shape the human behavior which transits from one generation to the next. It is a common heritage & way of life.

Cognitive ( beliefs, customs)

Internal mental

culture Normative ( Ethics, Moral

values)

Socio culture

External material ( Habits & Behavior)

culture

Not for circulation : for internal use only

slide16

Buying Decision process

Input

Stimuli

Motivation

Attitudes, Personality, Perception

Need

recognition

Information

search

Evaluation

Of alternatives

Purchase

Decision

Post purchase

Behvaiour

Output

Behaviour

Not for circulation : for internal use only

slide17

Behavior of a consumer is determined by his strong desire & need.

Hierarchy of need : Abraham Maslow

Sense of achievement & competence

Owning Power & Prestige

Similar belief, status class etc

Assurance , Protection

Self

Actualization

Esteem

(Recognition)

Social(Affiliation)

Safety (Security)

Physiological ( Basic)

Needs which are

important to

consumer

Not for circulation : for internal use only

slide18

Manifestation of culture

Symbols represent the most superficial manifestation of the culture. It could be words in the language ,dressing style, hairstyle which can be easily copied .Eg A conservative middle class woman having moved to up-country , colors her hair using L’Oreal & echoing its tag line I am worth it.

Symbols

Heroes

Rituals

Practice

Value

Not for circulation : for internal use only

slide19

Values :Values are formed at much early in age ,at home or school & are the deep rooted . While all values have its own negatives & positives, it can rarely be changed .

Ritual & heroes fall between the deepest & superficial manifestation . Heroes are people ,alive or dead or imaginary serving as a role models of the behavior.

Rituals are ways of socially greeting, social & religious ceremonies . A traditional marriage ceremony, being followed with out questioning it.

Culture strongly influence the decision making behavior of a consumer.

Manifestation of culture for the following consumer segment

1 Middle class middle age consumer ( 30-39)

2 High net worth ( HNI) class middle age consumer ( 30-39)

3 DINK (25-32 age ) salaried class

Objective : understand the buying behaviour while buying /investing in House properties .

Not for circulation : for internal use only

slide20

Influence of life style factor.

  • Family plays an important role as a social group influencing consumer’s behaviour. The influence is either as face to face ( primary group or as reference group ( values, norms, living standard etc)
  • Understanding of family Life cycle ( FLC)
  • FLC: A composite variable created by systematically combining commonly used demographic variables like : size of the family, martial status age earning members , disposable income etc.
  • FLC is studied from the view point of :
  • Bachelor hood status
  • Married couple
  • Parent hood
  • Post parent hood
  • Dissolution

Parent hood is further classified in to Full nest 1 , 2 & 3 stage .

Post parent hood is classified in to Empty nest 1 & 2

Not for circulation : for internal use only

slide21

Cultural & societal variables establish the outer boundaries of life style specific to culture . The interaction of the group & individual expectations & values create a systematic pattern of behaviour.

This life style pattern determines the purchase decision.

Life style refers to the way in which people live & spend money . Consumer psychographic profiles are derived by measuring different aspects of the consumer such as : Activities , Interests & opinion referred as AIO inventory

It helps to look at wide variety of variables & measures the major dimension as follows:

Feldman & Theibar explains life style by the following characteristics:

1 Life style is a group phenomenon . It is influenced by his/her participation in social groups & individual personality ( attitude , emotional status driven by beliefs & values )

2 Life style implies a central life interest . The central life implies interest factors like family, work , leisure , religion , politics , sexual exploits

3 The rate of social change in a society has a great influence on the life style. Age , gender , religion ethnicity & social class . E.g. Dual income class , nuclear family

High earning potential in early age & late working hours .

Not for circulation : for internal use only

slide22

Psychographic Segmentation

Psychographic profiles are drawn by measuring different aspects of consumer behaviour such as activities , interest& opinion (AIO inventory) helps to link wide variety of variables & measures the major dimension on the life style of a consumer

Activities Interests Opinion Demographics

Work Family Themselves Age

Vacation Entertainment social occupation

Not for circulation : for internal use only

slide23

VAL( Value & Life style Classification ) System . ( developed by Arnold Mitchell)

The system was developed to explain the dynamics of societal change in the buying behavior of a consumer . Accordingly consumer responses were collected for 35 attitudinal & 4 demographic questions. On the basis of these responses consumers were classified in eight distinctive sub groups. Each group signifies a behaviour response pattern ( life style ) & inner psychological needs ( Value )

It acts as a dynamic frame work of values & life styles which helps to explain why people have a explicit behavior

Eight VAL segments are :

Actulizer Experiencer

Fulfilled Maker

Believer Struggler

Achiever

Striver

Not for circulation : for internal use only

slide24

VAL Segments

Most resourceful

Enjoy the

Inner thing,

Receptive to new product

Technologies

Actualizer

Status oriented

Principle oriented

Action oriented

Attracted to premium

products

Follow fashion

& Fad

Less interested in

image & prestige

Expereincer

Achievers

Fulfilled

Shop for comfort

, willing try change.

Slow to change

, habits, look for bargains

Image conscious ,

limited income

Maker

Striver

Believer

Need driven

Struggler

Not for circulation : for internal use only

slide25

VAL Segments

  • Actulaizer
  • 1 Integrated : Balanced between inner & outer directed factors
  • 2 Achiever : Want to be a Role models ,
  • 3 Societal conscious : High sense of social responsibility believes in
  • changing the system & environment.
  • Outer directed segment
  • 4. Belonger
  • 5. Emulator : Upwardly mobile people & status conscious .
  • Inner directed
  • 6 I am Me : Young & self engrossed driven by whims
  • Experiential : Want to experience what life has to offer strong
  • believer's in destiny
  • Need Driven
  • 8 Survivor

Not for circulation : for internal use only

slide26

Consumer segmentation process ( Homogeneous Group )

Concern of large organizations: : How to harness the potential of 2/3 rural population having highest degree of diversity in the rural India to the main stream of the business.

Bases of segmentation are : 1 Demographic segmentation

( factors like Age , family , gender , marital status religion language )

Cosmetic, food , insurance service etc. )

2. Economic Segmentation : Income levels

Middle class , upper/ premium, class , lower middle , lower class ( LIG , MIG , HIG )

3. Psychographic segmentation : combinations of Social group, sub group, attitude, perception, opinion , interests life style . VAL basis ( Value & life style)

Actualizer , fulfilled, Believer, Achiever , Striver, Experiencer, Maker

Consumer classification on the basis of soico- Economic factors

SEC A+++

SECA++

SECA+

SECB++

Not for circulation : for internal use only

slide27

Geographic segmentation

Rural , Urban , Global , Semi rural , Semi Urban leading to life style, climate , population etc.

Institutional segmentation : Large corporate segment ( Global & Domestic) , SME , SOHO , FTU Govt, PSU etc

Benefit Segmentation : Convenience , social acceptance. Long lasting Economy ( High, medium, low or heavy , regular Extra large small family pack etc.)

Not for circulation : for internal use only

slide28

Diversity of consumer behavior . Consumer segmentation & profiling

2. Changing trends: Children hold strong buying power in key segment. ( Indian kids rank 3rd worldwide in influencing the buying decision)

Segment Children Decision maker.

Soft drinks 33.6 %

Health drinks 31.4%

Tooth paste 30.5%

restaurants 28.6%

Segmentation of Kid consumer :

Consumer Segment: Infant, Growing kid , teenager, Youth

[parameters : Age, intelligence( IQ) level , Family group belonging , societal influence , point of purchase , Personality , Self concept.

There is a child in every human being which does not grow with time .

Disney strategy

Not for circulation : for internal use only

slide29

Psychographic segmentation of Women , a potential decision maker. (Classification on the basis of the diversity in the behavior)

  • Miss Sophisticate
  • Traditionalist
  • Troubled home baby
  • Ms up to date
  • Ms nonsense
  • Conservative
  • Warm & hospitable
  • Gregarious hedonist
  • Youth classification in to six segments
  • Cultural misfit :
  • Style Bhai
  • Middle class Manju
  • Main Bhi NRI
  • Rich Brat
  • Nerdy Nandu

Not for circulation : for internal use only

slide30

Discovering new identity in Urban woman

The quint essentional self sacrificing Gharelu married Indian urban woman consumer is increasingly morphing in to independent minded assertive entrepreneurial class.

( Research study conducted by Lowe Asia – Pacific )

Psycho graphically charted consumer segmentation

Modern ( willing to embrace new values)

Mrs Hasmukh 27%

(Role model Didi )

Mrs India

Mrs Meri Awaz Suno

(Attention seekers) 31%

Stability

seekers

Change

seekers

Mrs Pataka

Cool

Mrs Gharelu 18%

( Home pride)

Mrs Hey Bhagvan

Moaner

Traditional ( Be contended /compromise with

old system)

Not for circulation : for internal use only

slide31

Mrs Garelu is just 18% of the total sample size. Who are they ?

Home pride . A perfect home maker .

Behaviour :

Uses parachute oil for kids & self , Fair & lovely being a part of her make up kit.

She is proud of her washing machine & water filter.She is likely to buy a microwave owen or expensive home appliances. But she prefer to use branded sanitary napkins.

Her husband relies heavily on her.

Social : She hate wasting money on outing , eating entertainment. Entertainment is all around Jassi & K series .

Belief : Strong believer of good education to her kids. Choosing any unknown

New career by the family member is not acceptable.

Attitude : Family is more important & believes that star determine her fate.

Value : Respect can never be compromised. High level of tolerence .

Never address the husband by name .( “Munne ke papa, Suno ji” type ) . Do not question the roots of tradition, rituals. They are always for good. Just adapt it.

She is Quintessentional sacrificing Maa

Not for circulation : for internal use only

slide32

Fast moving trend is seen from Mrs Gharelu to Mrs Has mukh

Who is Mrs Hasmukh ?

Attitude: A lively cheerful & positive personality. She treats her life like a must win contest . A friendly nature . Talking to a stranger of opposite sex & accepting him as a friend is normal . A perfect wife, mother , daughter in law , friend , independent minded , divides her time between husband , kids , family herself, & her friends. Not self sacrificing

Belief : While she is religious , she does go to beauty parlour with equal vigour.

Usage : She likes to buy things which make her household chore more convenient . Microwave Owen, Dishwasher, Vacuum cleaner , Oriflame conditioner, foot cream, Nourishing night cream products .

Social gathering , party with friends , family etc.

She encourages her kid to be more independent, explore & peruse their career where you can deliver your best result, like she herself would like to do. She likes to be seen as trendy .

She is a role model Didi for many women

Not for circulation : for internal use only

slide33

Mrs Pataka:

Characterised by the style quotient , acts cool & talks about doing what other women don’t. Take pride in sending their kids to the best school in town. Style matters in terms of regular visit to palour, PTA , Social meet , week end party & dining , need varieties of perfume for different occasion. She expects her husband to consult her in all decisions & upholds her individualism.

Attention seekers: Stifled by the various restrictions & norms imposed on her craves for attention, likes when others empathise with her .Her husband does not necessarily take her opinion in all home related issues. Saving is not her forte. Will use fairness cream , oil her hair on daily basis. She hopes high expectation on her son& daughter. She does not mind using unbranded or lesser known brands still feel good about herself.

She feels miserable about her inability to send her kids to expensive schools, lavih spending .She believes that fate is determined by her stars.

She wants to come out of middle class dudgery. More of self sacrificing type & wants to move away from joint family class.

Not for circulation : for internal use only

slide34

Perceptual constructs

Stimulus Perceptual bias Perception

ambiguity

Stimulus ambiguity : All information available is not crystal clear to the consumer in its meaning leading to a mental process to make decision based on the selective preference.

Perceptual bias : Attending to the selective information as a result of one’s own frame of reference.

Perception is a process of selecting, organizing & interpreting or attaining the meaning of what is happening in the environment.

Not for circulation : for internal use only

slide35

Individual behavior has a general tendency to get carried by the perception & not by the facts & reality while making decision.

Perceptions are formed as a result of the surrounding knowledge as perceived by the consumer .The individual behavioral action ( buying process ) emotion , feeling etc are based on the perception. Perceived reality varies from person to person .

1 How is sensation different from perception ?

2 Is the consumer driven by sensation or perception ?

Not for circulation : for internal use only

slide38

1 How is sensation different from perception ?

2 Is the consumer driven by sensation or perception ?

Not for circulation : for internal use only

slide39

Sensation is an immediate response of a physical sensory organ due to internal or external stimuli .The response will vary depending up on the intensity of the stimuli or sensitivity of the person to the stimuli (ie the individual’s sensory receptor. )

Sensation is related to basic physiological behavior .

Perception co-relates , integrates & comprehends the various sensations & information received . It is formed by both physiological & psychological factors.

Not for circulation : for internal use only

slide40

External Factors

Intensity&Size

Position

Contrast

Novelty

Repetition

Movement

Internal Factors

Selective attention

Selective Exposure

Selective reception,

comprehension &

retention,

Perceptual vigilance

or defense

Expectation

Subliminal perception

PERCEPTION

Not for circulation : for internal use only

slide41

Both internal & external factors influence the perception of the buyer

Blind test of Coke & Pepsi

Pepsi preference population 51 %

coke 44 %

equal /can’t say 5%

Identity revealed test

Pepsi 23%

coke 65%

equal/can’t say 12%

Conclusion : Both internal & external factors influence the way in which an individual perceives a product or brand.

Not for circulation : for internal use only

slide42

Decision making frame work : Perception

Cultural factors

Social factors

External factors

Internal factors

Psychological factors

Personal factors

Not for circulation : for internal use only

slide43

Internal factors

1.Selective attention : Tendency to see, hear & filter . The stimuli which fall out or below the threshold limit are screened out.

2.Selective exposure. : Tendency to avoid or come in contact with message which are contradictory to the strongly held belief and attitude . (Referred as cognitive consistency )

Consumer’s look out or seek message that they feel are pleasant or sympathetic to their causes & action .( Referred as cognitive dissonance )

E.g. : Chewing Paan or tobacco

consumption of excessive alcohol

Not for circulation : for internal use only

slide44

Internal factor (cont..)

3.Selective reception, comprehension & retention : Tendency to accept the information which fits in to his or her existing mind set & support their preconceptions. They remember only those things which support s their belief & attitudes.

4.Perceptual vigilance or defense.

Screening out or defending the information which create conflict or give rise to threatening situation.

E.g. : Generation gap issues . Dating , live in relationship , Ads which might lead to embarrassing questions

5.Expectation : State of anticipation of a particular behavior of a person due to known or un known past experiences or preconditioned set.

Not for circulation : for internal use only

slide45

Subliminal perception : Influence the people for decision with out being aware of what they are doing .

Addressing below the conscious awareness level.

The subliminal perception are :

1 Visual stimuli presented in brief .

2. Speech given fast in low volume auditory message

3. Embedded or hidden or imagery words given either in print ads or on product labels.

Not for circulation : for internal use only

slide46

External Factors are physical properties. Like :

Intensity & size : bright & vibrant Colors ,loud ,melodious , sound , size etc used for advertising leads to perception building .

Position : PoP in the retail outlet , front page last cover, exclusive magazine ( Interior design- Inside out side ) Business world etc

Contrast : Media planners use contrast to build perception like : Voice contrast for superiority , confidence & doubt . Loud & soft color tones. Black & white . Contrast pictures . Eg It’s your life .

Novelty: Unusual shape , size , odor etc. Perfume bottles , Baby diapers Sanitary napkins , Toys , Greeting cards. Etc

Not for circulation : for internal use only

slide47

Repetition & movement : Multiple exposure in a limited time , to generate high recall or Dynamic billboards & hoarding or moving van carrying the products which rare demonstrated to create high usage & perception.

Figure & ground: Figure is perceived to be more dominant & attention seeking , hence important stimuli to be placed as figure & other phenomenon in the back ground.

Closure leading to build positive perception : Incomplete picture, broken line statements left to the audience to fill the gaps themselves to gain more meaningful information.

Perceptual distortion on account of :

Stereo typing , Hallo effect. Irrelevant clues. First impressions

Not for circulation : for internal use only

slide48

Consumer Attitude : Formation & change

In consumer behavior context , attitude is a learned pre deposition

to behave in a consistently favorable or unfavorable way with respect to a given stimuli.

Stimuli refers to a product catogory, brand, people related to a brand or service .

Learned deposition refers to source information including perception , experience , exposure to media etc which helps to build an attitude & gives momentum to the behavior . The momentum can be negative or positive.

Consistency refers to the voluntary decision which makes the consumer to purchase the product/ service / brand till such time there are no intervening factors which force the consumer to change the attitude.kj

Not for circulation : for internal use only

slide49

Tri component Attitude model: This model comprises of three components . 1 Cognition component

2 Affective

3 Conation

Cognition

Conation

Affect

1.The knowledge & perception acquired by the people which takes the form of belief about the attributes of the product.

2.The consumer’s feeling & emotions associated with the product.

3.The consumer’s intention or the probability to take a definite action with respect to the brand. (this is referred as an actual behavior )

Not for circulation : for internal use only

slide50

Consumer ‘s retention process depends on how they perceive the product /Brand differentiation & their involvement with the product/brand.

Involvement = f ( Personal , situational , Object )

High Product Involvement Low

High

Learning Model

Cognitive

Affective

Conative

Low involvement

model

Cognitive

Conative

Affective

Perceived

product/brand

differentiation

Dissonance Model

Conative

Affective

Cognitive

Low

Not for circulation : for internal use only

slide51

FCB Grid ( Foote, Cone, Belding )

Analysis & Processing through Right & Left Brain :

Rt Brain : Emotional & Visual : ( Feeling )

Lt Brain : Analytical & Rational : ( Thinking )

consumer type Thinking Feeling

High

Involvement

Low

Search for search for Life style

functional benefit emotional attachment

Economic Value ? Psychological value

THINKER FEELER

NON Responsive Self Satisfied

Not for circulation : for internal use only

slide52

Attitude towards the AD model.

Relationship of attitude with communication

Exposure of an Ad

Feeling from the Ad

Judgement about

the Ad

Attitude towards the

Ad

Belief about the

brand

Attitude towards the

brand

Not for circulation : for internal use only

slide53

Attitude formation :

Attitude formation happens from 5 sources:

1 Information

2 Exposure

3 Group membership

4 Environment

5 Want satisfaction.

Not for circulation : for internal use only

slide54

Attitude Measurement tools :

Likert Scale : In a questionnaire designed for customer response

Customer responses are gathered which best describes to an extent they agree / disagree satisfied/ unsatisfied , Extremely important, un important etc

Semantic differential scale :

For each of the features identify one alternative which express the consumers feeling ,preferences, liking etc the best. It consists of a series of bipolar adjectives eg best & worst, Hot & cold , expensive & in expensive etc anchored at the end of the odd numbered( 5or 7) continuum.

Strongly agree , partially agree , neither agree or disagree , partially disagree, strongly disagree

Not for circulation : for internal use only

slide55

Behavior Intention scale : To test the behaviors of the consumer that how likely he/she is to consume your service in next 3, 6 months .

Definitely , probably , Not sure, Probably not Definitely not.

Not for circulation : for internal use only

slide56

Consumer behavior models having relevance on decision making process.

1. Learning Model ,

2. Psychoanalytic model

3. Sociological model ,

Not for circulation : for internal use only

slide57

Classical conditioning process of learning : Behavior becomes dependent on certain stimuli or events in the environment.

A consumer is said to have learned , when he or she responds in a predictable manner to a known stimulus. [ Also known as Stimulus - Response ( S -R) theory of association )]

Unconditioned stimulus Unconditioned Response

Conditioned stimulus

Conditioned stimulus Conditioned response

Not for circulation : for internal use only

slide58

Consumer Learning : A process by which a consumer acquires the

purchase & consumption knowledge experience which apply to his future behavior . .

Components of learning process are :

Drive Clue Response Reinforcement Retention.

Drive : strong stimuli which impels action.

Clue: An object in the stimuli which elicit a specific response.

Response : Behavioral response in the from of physical terms , Attitudes, Perception etc.

Reinforcement :Environmental events which increases the psychological process of motivation, increasing the likelihood of specific response.

Retention : Stability of learned behavior over a period of time.

Not for circulation : for internal use only

slide59

Eg : Desirable association for Liril soap Ad

Waterfall naturally & purity Young girl Natural beauty , purity imposed on Liril

LIRIL SOAP

Symbolic of

natural & purity

Water fall

natural &

Pure

Young Girl

Natural beauty

& purity

Not for circulation : for internal use only

slide60

Brand Recall

Brand

Awareness

Brand recognition

Functional

Experimental

Symbolic

Benefits

Brand

personality

Types of

association

Attribute

Brand

Image

Attitudes

Non product

related

Product

related

Price, package ,user imagery

usage imagery

Not for circulation : for internal use only

slide61

Hofstede structure for building BRAND Identity( Onion ring model )

Symbols

functional

Role models

Rituals

Core value

of the brand

Social

Emotional

The core of the brand defines identity /personality .

Not for circulation : for internal use only

slide62

Core Value : Central idea or essence that the brand stands for.

Rituals:Traits, habit process & , internal mental culture, external material culture .

Role models. : People & places the consumer group look up to or follows , get driven by .

Symbols: Places objects, process or people associated with the individuals.

Not for circulation : for internal use only

slide63

The layers of the model correspond to the layers that constitute consumer’s personality .

The corresponding layers are : Core value

Rituals

Role models

Symbols

While developing a brand identity , the core value proposition( Central idea ) of the brand is identified on the basis of the need of the consumer.

The core value is mapped with the elements which comprise rituals, symbols , role models of the core value .

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Consumer Personality

An eagle’s egg was placed in the nest of a prairie chicken. The egg got hatched & the little eagle grew up in the surrounding of a chicken. It scratched in the dirt for seeds , clucked & cackled. It never flew more than a few feet. One day an environmentalist saw the eagle with the chicken & persuaded the owner to let it free . The eagle is not meant to be on the ground, it the is it world. He said that it is doing what it has learnt from its friend. You try , if it can fly & go up in the sky to never return again . The environmentalist tried , took it high on a mountain , held up & said the sky is your world go . The eagle flew a few meters & came back on the ground. In spite of repeated attempts the eagle could not fly.

He brought it back & put it back with the chicken. It flapped its wings & got back to the dirt's to find the seeds to feed itself.

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Origin of personality

Personality

development

Behavior

Genetic

Determinants

Parental

Determinants

Experimental

Determinants

External

Determinants based

on social, cultural

Race, religion etc.

Individual differences in behavior

Development of

Stable personality

Characteristics.

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Consumer personality

Motivation

Self image

Perception

Temperament

Learning Behavior

Attitude

How is consumer personality related to brand personality ?

Consumer personality =Brand personality = Successful brand

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Consumer Personality can be studies through :

1Type theory

2Trait theory

3Psycho analytic theory

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Consumer behavior models having relevance on decision making process.

1. Learning Model ,

2. Psychoanalytic model

3. Sociological model ,

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Consumer Learning : A process by which a consumer acquires the

purchase & consumption knowledge experience which apply to his future behavior . .

Components of learning process are :

Drive Clue Response Reinforcement Retention.

Drive : strong stimuli which impels action.

Clue: An object in the stimuli which elicit a specific response.

Response : Behavioral response in the from of physical terms , Attitudes, Perception etc.

Reinforcement :Environmental events which increases the psychological process of motivation, increasing the likelihood of specific response.

Retention : Stability of learned behavior over a period of time.

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Eg : Desirable association for Liril soap Ad

Waterfall naturally & purity Young girl Natural beauty , purity imposed on Liril

LIRIL SOAP

Symbolic of

natural & purity

Water fall

natural &

Pure

Young Girl

Natural beauty

& purity

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Repetition enhances the association of Stimuli to response. Effectively used in creating subliminal approach.

Technology posing threats to subliminal approach.

Zipping ( FF) Zapping( CC) & Filtering

REALITY : More than 60% TVC are zapped.

Preventing zipping , zapping & filtering

1. M’c Erikson study: Made AD more entertaining

2. Ad creating which catch attention of people for active search.

3. Leave information of practical value (Domestic appliances )

4. Make short copy

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FCB grid helps to make advertising planing process based on the consumer - product relationship & develop appropriate promotional strategies. An effective creative options like rational versus emotional appeals are the strategies , creative AD maker can develop using FCB grid.

High envelopment & Thinking

Consumer is Informative thinker , Search for economic value

Strategy used : Specific / to the point information demonstration , dissemination . Build high recall .

High involvement & feeling .

Consumer is driven by psychological ( feel-learn-do) emotional drives. Eg: Fashion & fad products.

Strategy used: Emotional arousal , bring Attitude change

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Low envelopment & Thinking

Consumer is non responsive to market communication

Strategy : Inculcate do-learn-feel habit ,Sales Promotion tactics to induce buying habit.

Small space ads, More Point of Sales POS materials are used .

Frequent reminder

Low involvement & feeling .

Consumer has strong emotional bonding addition to a brand , product . Unwillingness to change. Eg : Alcohol ( liquor) Tobacco etc.

Strategy : Build do-feel-learn habit . Creative strategies like consumer Mentoring , strategic sales promotion etc.

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Stimulus Generalization : The stimuli similar to a conditioned stimulus will elicit a similar response without prior learning.

Umbrella branding ( Family Branding ) Ariel green, Micro shine Super soaker etc Or Godrej No1 soap , Godrej refrigerator etc

Product line extension : Lux beauty soap, Lux beauty liquid soap, face wash etc.

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Cognitive factors which affect the classical conditioning process are:

Consumer characteristics. Impact of visual stimuli depends on the the consumer’s ability to visualize the creative message. Over creative ads loose its impact when not understood by the consumer.

Further non visual stimuli ( jingle) has different experience with different consumer . Hence it can result in negative and positive learning experience .

Stimulus characteristics. : Known stimuli is avoided as pre exposure of stimulus reduces the impact on the consumer.

Eg Sales promotion techniques like discounts , gold coin , lottery etc

Blocking association :

A brand ambassador (stimuli ) having connection with a particular brand or product when used with another , consumer gets mentally blocked from making an association.

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Operant or instrumental conditioning .( Skinner theory)

A learning in which the consequences of behavior lead to changes

in the behavior pattern

conventional Partner Criticized Weakening of

blade ( punishment) Behavior ( Negative

action)

Gillete partner Admired ( Reward ) Strengthening

Sensor Smooth shave of behavior

Positive action

Mach -3 No comment ( No reward) Neutral . No Change

Behavior shaping : Rewarding the consumer in consequence to the desired behavior.

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Observational learning : Positive Behavior result only when the optimal use of the product is demonstrated .

The Ad makers have to communicate through creative usage of the brand /product for the consumer to imitate the person doing it.

Selection of Brand ambassador :Eg Sanjeev Kapoor for masala ,

Personal care products. House wives for consume durable products.

Advantage : High imitation ,

Observational learning helps to build :

High attention positive learning Desired Reward( learning)

behavior

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Consumer personality

Motivation

Self image

Perception

Temperament

Learning Behavior

Attitude

To build the brand personality , which appeal the consumer ,Consumer personality needs to be understood by the brand manager.

How is consumer personality related to brand personality ?

Consumer personality Emotional relationship Brand personality

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Consumer Personality

Consumer personality change with the life of an individual , describing the development of the human psychological setup.

Personality is formed due to the internal system inherited & all those factors the consumers learn from the surrounding.

Personalities like aggressive, docile, friendly reclusive, arrogant ,charming etc are the reflection of the inherited & learned factors in a consumer.

Origin of personality

Traits

Genetic

Parental

Experimental

Cultural

Social

Race

Religion

Influence

Personality

Development

Of consumer

Individual

Differences in the

Form of behavior

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Type theory

Psychological theory shows that differences in consumer result due to different type they belong to .

1. Where they prefer to focus their attention.

( Extraversion, Introversion)

2. The way they prefer to take the information

(Sensing or intuition )

3. The way they prefer to make decisions

(Thinking or feeling )

4. How they orient themselves to the external world .Do they use the judging process or perceiving process.

(Judging or perceiving )

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Characteristics :

extraversions.

Prefer communicate by talking

Breath of interests

Tend to speak first , reflect later

Take initiative in work & relationship

Learn best through doing or discussion.

Introversion.

Drawn to their inner world.

Learn best by reflection , mental practice .

Prefer communicate by writing

Depth of interest

Private & contained

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Sensing .

Focus on what is real & actual

Value practical application

Observe & remember ,Present oriented

Want information step by step

Trust & experience

Intuition

Focus on big picture , possibilities

Value imaginative insight

Abstract & creative ,See pattern & meaning in facts . Future oriented ,Trust inspiration

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Thinking .

Analytical , logical problem solver

Use cause & effect reasoning

Tough minded ,Reasonable

Fair

Feeling

Sympathetic ,Assess impact on people

Guided by personal values , Tender hearted

Strive for harmony & individual validation

Compassionate , Accepting

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Judging .

Scheduled ,

Organized ,

Systematic ,

methodical Plan ,

Like closure –to have things decided

Avoid last minute stress.

Perceiving

Spontaneous,

Open ended ,

Casual, Flexible, Adapt

Like things loose & open to change

Feel energized by last minute pressure.

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Consumer type is decided based on these factors.

The types are :

ISTJ Introverted sensing with extraverted thinking

ISFJ Introverted sensing with extraverted feeling

ESTP Extraverted sensing with introverted thinking

ESFP extraverted sensing with introverted feeling

INTJ Introverted intuition with extraverted thinking

INFJ Introverted intuition with extraverted feeling

ENTP Extraverted intuition with introverted thinking

ENFP Extraverted intuition with introverted feeling

ISTP Introverted thinking with extraverted sensing

INTP Introverted thinking with extraverted intuition

ESTJ Extraverted thinking with introverted sensing

ENTJ Extraverted thinking with introverted intuition

ISFP Introverted feeling with extraverted sensing

INFP Introverted feeling with extraverted intuition.

ESFJ Extraverted feeling with introverted sensing

ENFJ extraverted feeling with introverted intuition

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Type theory

Psychological theory shows that differences in consumer result due to different type they belong to .

1. Where they prefer to focus their attention.

( Extraversion, Introversion)

2. The way they prefer to take the information

(Sensing or intuition )

3. The way they prefer to make decisions

(Thinking or feeling )

4. How they orient themselves to the external world .Do they use the judging process or perceiving process.

(Judging or perceiving )

Not for circulation : for internal use only

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1. ISTJ : Serious , quiet, practical, orderly , logical , make up their mind , as what they want to do , regardless of the external message .

2. ISFJ Loyal , considerable , concerned with how others feel Emotion oriented.

3. INFJ Highly principle oriented.Driven by their vision .

4. INTJ Driven their by their own ideas. Skeptical , critical & independent

5. ISTP Cool onlooker , detached curiosity , interested in cause & effect , logical principles . Drive to the core of the problem before taking decision.

6. INFP Quite observer. Balance between outer life & inner values.

7. ISFP Retiring , sensitive & emotional, not planing for long term .

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8. INTP :Logical & analytical Have a very clearly defined preferences Not willing to change easily.

9. ESTP Spot decision makers . Enjoys as it comes in the way. Not long term planers or thinker.

10. ESFP : Practical & situational decision makers

11.ENFP Warm , imaginative , takes decision which interest them. Finds reason for that ever they want.

12. ENTP Quick & alert . Develop logical reasons for what they want to buy

13. ESTJ : Realistic fact driven , rational approach.

14. ESFJ : warm hearted, emotional .driven by life style status.

15. ENFJ Responsive, sympathetic , regard for other’s feeling, Emotional driven decision.

16. ENTJ Frank , Out spoken, rational , straight forward. Application & value oriented.

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Consumer segment & type is decided using a structured focused questionnaire,

The questionnaire is based on :

1 Product related / non related attributes features functions .

2. Functional experiential & symbolic benefits

3. Psycho factors . Where they prefer to focus their attention.

The way they prefer to take the information

The way they prefer to make decisions

How they orient themselves to the external world .

The information is collected for a large sample differently on the above three categories & analyzed together.

Not for circulation : for internal use only

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Characteristics :

extraversions.

Prefer communicate by talking

Breath of interests

Tend to speak first , reflect later

Take initiative in work & relationship

Learn best through doing or discussion.

Introversion.

Drawn to their inner world.

Learn best by reflection , mental practice .

Prefer communicate by writing

Depth of interest

Private & contained

Not for circulation : for internal use only

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Sensing .

Focus on what is real & actual

Value practical application

Observe & remember ,Present oriented

Want information step by step

Trust & experience

Intuition

Focus on big picture , possibilities

Value imaginative insight

Abstract & creative ,See pattern & meaning in facts . Future oriented ,Trust inspiration

Not for circulation : for internal use only

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Thinking .

Analytical , logical problem solver

Use cause & effect reasoning

Tough minded ,Reasonable

Fair

Feeling

Sympathetic ,Assess impact on people

Guided by personal values , Tender hearted

Strive for harmony & individual validation

Compassionate , Accepting

Not for circulation : for internal use only

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Judging .

Scheduled ,

Organized ,

Systematic ,

methodical Plan ,

Like closure –to have things decided

Avoid last minute stress.

Perceiving

Spontaneous,

Open ended ,

Casual, Flexible, Adapt

Like things loose & open to change

Feel energized by last minute pressure.

Not for circulation : for internal use only

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Consumer type is decided based on these factors.

The types are :

ISTJ Introverted sensing with extraverted thinking

ISFJ Introverted sensing with extraverted feeling

ESTP Extraverted sensing with introverted thinking

ESFP extraverted sensing with introverted feeling

INTJ Introverted intuition with extraverted thinking

INFJ Introverted intuition with extraverted feeling

ENTP Extraverted intuition with introverted thinking

ENFP Extraverted intuition with introverted feeling

ISTP Introverted thinking with extraverted sensing

INTP Introverted thinking with extraverted intuition

ESTJ Extraverted thinking with introverted sensing

ENTJ Extraverted thinking with introverted intuition

ISFP Introverted feeling with extraverted sensing

INFP Introverted feeling with extraverted intuition.

ESFJ Extraverted feeling with introverted sensing

ENFJ extraverted feeling with introverted intuition

Not for circulation : for internal use only

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1. ISTJ : Serious , quiet, practical, orderly , logical , make up their mind , as what they want to do , regardless of the external message .

2. ISFJ Loyal , considerable , concerned with how others feel Emotion oriented.

3. INFJ Highly principle oriented.Driven by their vision .

4. INTJ Driven their by their own ideas. Skeptical , critical & independent

5. ISTP Cool onlooker , detached curiosity , interested in cause & effect , logical principles . Drive to the core of the problem before taking decision.

6. INFP Quite observer. Balance between outer life & inner values.

7. ISFP Retiring , sensitive & emotional, not planing for long term .

Not for circulation : for internal use only

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8. INTP :Logical & analytical Have a very clearly defined preferences Not willing to change easily.

9. ESTP Spot decision makers . Enjoys as it comes in the way. Not long term planers or thinker.

10. ESFP : Practical & situational decision makers

11.ENFP Warm , imaginative , takes decision which interest them. Finds reason for that ever they want.

12. ENTP Quick & alert . Develop logical reasons for what they want to buy .

13. ESTJ : Realistic fact driven , rational approach.

14. ESFJ : warm hearted, emotional .driven by life style status.

15. ENFJ Responsive, sympathetic , regard for other’s feeling, Emotional driven decision.

16. ENTJ Frank , Out spoken, rational , straight forward. Application & value oriented.

Not for circulation : for internal use only

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Consumer segment & type is decided using a structured focused questionnaire,

The questionnaire is based on :

1 Product related / non related attributes features functions .

2. Functional experiential & symbolic benefits

3. Psycho factors . Where they prefer to focus their attention.

The way they prefer to take the information

The way they prefer to make decisions

How they orient themselves to the external world .

The information is collected for a large sample differently on the above three categories & analyzed together.

Not for circulation : for internal use only