layout: true background-image: url(figs/tcb-logo.png) background-position: bottom right background-attachment: fixed; background-origin: content-box; background-size: 10% --- class: title-slide .row[ .col-7[ .title[ # Consumer Behavior ] .subtitle[ ## An Introduction ] .author[ ### Dennis A.V. Dittrich ] .affiliation[ ] ] .col-5[ ] ] --- # What Is Consumer Behavior? .col-7[ 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. ] --- # Consumer behavior is a process .pull-left[ ![](img/011.png) ] .pull-right[ * First, the field referred to only buyer behavior * Marketers now recognize that consumer behavior is an ongoing process, not merely what happens at one point in the **transaction cycle**. * The **transaction** of value between two or more is an **exchange**. * Exchange is an integral part of marketing. * Consumer behavior recognizes that the entire consumption process is relevant for marketers. ] --- class: reflection-slide # For Reflection .col-8[ What aspects of consumer behavior would interest * a financial planner? * a social worker in a government agency? ] --- # People in the Marketplace .pull-left[ ![](img/012.png) #### Consumption Communities * where members share opinions and recommendations ] .pull-right[ #### Market Segmentation Strategies * an organization targets its product, service, or idea only to specific groups of consumers rather than to everybody * consumers who don’t belong to this target market aren’t attracted to it * leads to product differentiation ] --- ## Stages in the Consumption Process ![](img/013.png) * A person who identifies a need or desire, makes a purchase, and then disposes of the product is a **consumer**. * The purchaser or user might be the same person, or not. --- class: reflection-slide # For Reflection .col-8[ 1. How do you decide that you need a product? 2. What about a purchase makes it pleasant or stressful for you? 3. When using the product, what determines if the experience is pleasant? ] --- ### Marketers have to understand the wants and needs of different consumer segments. .pull-left[ #### Consumers Are Heterogenous * Marketers must understand the various consumer segments they are targeting in order to meet the segments’ needs. * They need to adjust their message strategy to address the concerns of their target audience. ] .pull-right[ #### Many dimensions are relevant for understanding consumer needs and wants. * Many demographic variables that can help in understanding groups of consumers. * Usage (whether heavy or light) can help to focus marketers’ energies. * **Heavy Users** are the most faithful customers * **80/20 Rule**: 20% of users account for 80% of sales ] --- ### Segmenting Consumers: Demographics .pull-left[ Demographics are **statistics** that measure observable aspects of a population: * Age * Gender * Family structure * Social class/income * Race/ethnicity * Geography * Lifestyles ] .pull-right[ ![](img/015.png) ] --- ## Redneck Bank Targets by Social Class .row[.col-3[People who belong to the same social class are approximately equal in terms of their incomes and social standing in the community.] .col-9[![](img/016.png)] ] --- class: practice-slide # Review Question .col-8[ 1. How does the distinction of leading a "happy" life versus a "meaningful" life relate to the way you decide to spend your time and money? How does it relate to consumer behavior more generally? 2. What is market segmentation? Give three examples of market segments. ] --- ## Big Data .row[.col-7[ Database Marketing * tracks specific consumers’ buying habits very closely and crafts products and messages tailored precisely to people’s wants and needs based on this information. * The collection and analysis of extremely large datasets is called Big Data. * For instance, monitoring of Google searches for fever and flu can help epidemiologists to identify specific areas that have been hit by flu outbreaks even before patients begin visiting doctors and hospitals. Relationship marketing * Marketers try to understand their customers and develop lifelong relationships. ] .col-5[ ![](img/017.png) ]] --- ## Our choices as consumers relate in powerful ways to the rest of our lives. ![](img/018.png) Marketing influences popular culture and popular culture influences marketing --- # Popular Culture .col-7[ * Music * Movies * Sports * Books * Celebrities * Entertainment Marketers influence preferences for movie and music heroes, fashions, food, and decorating choices. ] --- ## Consumers may develop relationships with brands over time .col-7[ Role Theory * takes the view that much of consumer behavior resembles actions in a play. Self-concept attachment * the product helps to establish the user’s identity Nostalgic attachment * the product serves as a link to the consumer’s past Interdependence * the product is a part of the user’s daily routine Love * the product elicits emotional bonds of warmth, passion, or other strong emotion ] --- class: practice-slide # Review Question .col-8[ What is popular culture, and how does this concept relate to marketing and consumer behavior? ] --- ## Our motivations to consume are complex and varied. ![](img/019.png) People often buy products not for what they do but for what they mean. --- # Motivation: Need Versus Want .pull-left[ **Motivation** refers to the processes that lead people to behave as they do. It occurs when a need is aroused that the consumer wishes to satisfy. ![](img/0110.png) ] .pull-right[ A **need** creates a state of tension that drives the consumer to attempt to reduce or eliminate it. * **utilitarian need**: a desire to achieve some functional or practical benefit, as when a person loads up on green vegetables for nutritional reasons * **hedonic need**: an experiential need, involving emotional responses or fantasies ] --- class: reflection-slide # For Reflection .col-7[ 1. Describe a need and a want you have and explain the motivation for the want. 2. "People often buy products not for what they do but for what they mean." Explain the meaning of this statement and provide an example. ] --- ## Technology and culture create a new “always on” consumer. .col-7[ Access to the Internet is incredibly influential for consumer behavior. * It changes who you may interact with, the information you can find, the choices you see as available, and the time and energy you spend dealing with various decisions. * It has made it possible for businesses to use an additional channel of distribution (B2C e-commerce) but it’s also made possible C2C e-commerce, in the form of outlets like Etsy.com. * The Web hasn’t just changed consumer behavior by shifting our options in terms of channels of distribution. It’s also made possible a whole new form of media known as social media. ] --- ### The Digital Native: Living a Social [Media] Life .col-7[ * Digital Native * consumers grown up “wired” in a highly networked, always-on world where digital technology had always existed * Lifelog * Internet of Things \(IoT\) * network of interconnected devices embedded in objects * Autonomous vehicles * Smart home * M2M \(machine\-to\-machine communication\) * Artificial Intelligence \(AI\) * applications that get better over time via machine learning * Robot companions and sexbots ] --- class: reflection-slide # For Reflection .col-7[ 1. How has your daily life changed because of social media / how is it influenced by social media? 2. What does your virtual life look like? ] --- ### Many types of specialists study consumer behavior... <img src="img/tab01_01.jpg" width="100%" /> --- .row[ .col-4[ ### The Pyramid of Consumer Behavior ] .col-8[ ![](img/0111.png) ] ] --- class: reflection-slide .row[ .col-4[ ### For Reflection 1. Pick two of the disciplines shown in the Figure. How would their approaches to the same marketing issue differ? ] .col-8[ ![](img/0111.png) ] ] --- # Summary .col-7[ 1. Consumer behavior is a process. 2. Marketers have to understand the wants and needs of different consumer segments\. 3. Our choices as consumers relate in powerful ways to the rest of our lives\. 4. Our motivations to consume are complex and varied\. 5. Technology and culture create a new “always on” consumer\. 6. Many types of specialists study consumer behavior\. 7. There are differing perspectives regarding how and what we should understand about consumer behavior\. ] .grey.footnote[Figures curtesy of Solomon (2020); Consumer Behavior: Buying, Having, and Being; Pearson.]