Principles of

Marketing
Lecture-7

Todays Topics

Consumer Market

All individuals and households who buy or acquire

goods and services for personal consumption

Firm needs to know

Who buys?
How they buy?
When and where they buy??
Why they buy?
How they respond to marketing

stimuli?

Why do you think

marketers know these
things?

Because they study

consumer behavior
(CB)

What is Consumer
Behavior
about?

 How, why, where and when

consumers make purchase
decisions?
Considers who influences
the decisions?

 How are purchases made?

What information is needed for
those decisions?
What factors affect these
decisions?

Why is it
Important?

 Consumers determine the sales and profits

of a firm by their purchase decisions, thus
the economic viability of the firm.
In late 1990, US consumers were spending
enough dollar bills to stretch from the Earth
to the Sun and back, with enough left over
for over 600 lines to the moon!

Customer vs. Consumer

Behavior

Customer behavior
Includes both individual
consumers who buy goods and
services for their own use and
organizational buyers who
purchase business products.

Consumer behavior
Is the process through which the
ultimate buyer makes purchase
decisions.

Consumer Behavior
Defined

The study of the processes

involved when individuals or
groups select, purchase, use,
or dispose of products,
services, ideas, or
experiences to satisfy needs
and desires (Solomon, 1996).

Those actions directly involved in

obtaining, consuming and
disposing of products and
services, including the decision
processes that precede and follow
those actions (Engel et al. 1995).

Examines mental and

emotional processes in
addition to the physical
activities (Wilkie 1990).

Consumer Behavior
Deals With
Actions in Purchasing and Using Products
Including Behavior and Thought

Processes

The buying behavior of final

consumers-individuals and
households who buy
goods and services for
personal consumption.

Marketing
Applications

 Positioning
Segmentation
Product development
Market development
International marketing

Model of
Consumer Behavior
Stimulus-Response

Product
Price
Place
Promotion
Buyers decision
process

Product choice
Brand choice
Dealer choice

Marketing
Marketing and
and
Other
Other Stimuli
Stimuli

Buyers
BuyersBlack
BlackBox
Box
what
what&&how
how

Buyers
Buyers Response
Response

Economic
Technological
Political
Cultural
Buyer
characteristics
affecting
consumer
behavior

Purchase timing
Purchase
quantity

Marketing Other
stimuli
stimuli
Product
Price
Place
Promotion

Economic
Technological
Political
Cultural

Buyers decision
Buyers
characteristics process
Cultural
Social
Personal
Psychological

Problem recognition
Information search
Evaluation
Decision
Post-purchase
behavior

Buyers decisions
Product choice
Brand choice
Dealer choice
Purchase timing

Stimulus Response Model

Marketing and other stimuli

enter the buyers black box

and produce certain
choice/purchase responses.

Marketers must figure

out what is inside of the

buyers black box and
how stimuli are changed
to responses.

Consumer Behavior (cont..)