CB 1 Intro 1 Kompatibilit Tsmodus 21987517

Technische Universität München
Chapter 1
Introduction to Consumer Behaviour and

Marketing Strategy
Learning Goals
• Understand the role of consumption processes in society
• Understand approaches to consumer behavior research
• Understand critical aspects regarding ethical issues in marketing
2
Three Elements for Marketing Strategy
Peter and Olson, 2010 3

What is Consumer Behaviour?
• The dynamic interaction of affect and cognition, behavior, and the

environment by which human beings conduct the exchange aspects of
their lives (Peter and Olson, 2010)
• Involves thoughts and feelings people experience and actions they perform
in the consumption processes
• Includes all things in the environment that influence thoughts, feelings, and
actions
– Comments from other consumers
– Advertisements
– Price information
– Packaging
– Product appearance etc.
4
Dynamic Consumer Behaviour
• Thinking, feelings, and actions of individual consumers, targeted consumer

groups, and society at large are constantly changing
• Requires ongoing consumer research and analysis of important trends
• Makes development of marketing strategies difficult and exciting

– Product life cycles are getting shorter  Innovation is increasingly important
5
1-5
Consumer Behaviour Involves Interactions
• Interactions among people’s thinking, feelings and actions, and the

environment
• Marketers need to understand

– What products and brands mean to consumers
– What consumers must do to purchase and use them
– What influences shopping, purchase, and consumption
6
Role theory and consumer behaviour
• Consumer behaviour resembles actions/roles in plays

– Choosers – choosing between different alternatives
– Communicators – selecting goods that display our roles and statuses
– Identity seekers – showing our real selves
– Pleasure seekers – in search of a real kick of pleasure
– Victims – of fraudulent or harmful offerings
– Rebels – reacting against authority turning something into something else
– Activists – boycotting products that do not meet ethical standards
7
Consumer behaviour is a process
Figure 1.1 Some issues that arise during stages in the consumption process
8
Consumer Behaviour Involves Exchanges
• Exchange between people involves giving up of something of value and

receiving something in return
• Role of marketing in society is to help create exchanges by formulating and

implementing marketing strategies
9
1-9
The Study of Consumer Behaviour
• 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.
Figure 1.2 The pyramid of consumer behaviour, Solomon 2010
10
Consumer behaviour (continued)
• The field of consumer behaviour is interdisciplinary; it is composed of

researchers from many different fields who share an interest in how people
interact with the marketplace.
• These disciplines can be categorized by the degree to which their focus is

micro (the individual consumer) or macro (the consumer as a member of
groups or of the larger society).
11
The issue of strategic focus (1 of 2)
Table 1.1 Interdisciplinary research issues in consumer behaviour
12
The issue of strategic focus (2 of 2) (continued)
Table 1.1 Interdisciplinary research issues in consumer behaviour (Continued)
13
Perspectives on consumer behaviour
• There are many perspectives on consumer behaviour, but research

orientations can roughly be divided into two approaches
– The Positivist perspective, which currently dominates the field, emphasizes the
objectivity of science and the consumer as a rational decision-maker.
– The Interpretivist perspective, in contrast, stresses the subjective meaning of

the consumer’s individual experience and the idea that any behaviour is subject
to multiple interpretations rather than one single explanation.
14
Two perspectives on customer research
Table 1.2 Positivist vs. Interpretivist approaches to consumer behaviour

Source: Adapted from Laurel A. Hudson and Julie L. Ozanne, ‘Alternative ways of seeking knowledge in consumer research’, Journal of Consumer
Research 14 (March 1988): 508–21. Reprinted with the permission of The University of Chicago Press.
15
Paradigms of consumer behaviour research
S Laws/Function R Black box Model:

SR-Model
Behavioral
S Intervening variable R scientific
Approach:
SOR-Modell
R Information-
I Object
processing-
Modell
Source: Balderjahn & Scholderer, 2007. 16

Relationship among Action-Oriented Groups in Consumer

Behaviour
17
Uses of Consumer Behavior Research
• Three groups use knowledge about consumer behavior and consumer

behavior research
– Marketing organizations
• Businesses attempting to sell products
• Organizations that seek exchanges with consumers
– Government and political organizations

• Major concern is monitoring and regulating exchanges between marketing
organizations and consumers
– Consumers
• Includes consumers and organizational buyers who exchange resources for
various goods and services
• Interest in making exchanges that help them achieve their goals and the
understanding of their own behavior
18
Actors in the consumption play
• Purchaser
• User
• Influencer
• Organizations (different company agents, and the family for example)
19
Consumer Behaviour’s Role in Marketing Strategy (1)
• Marketing strategy
– Design, implementation, and control of a plan to influence exchanges to achieve

organizational objectives
– In consumer markets, these are designed to

• Increase chances of favorable thoughts and feelings of particular products,
services and brands among consumers
• Increase chances of trial and purchase
20
1-20
Consumer Behaviour’s Role in Marketing Strategy (2)
• Marketing strategies involve developing and presenting marketing stimuli

directed at selected target markets to influence
– What they think
– How they feel
– What they do
• Essence of marketing strategy is to understand markets, develop and

implement superior strategies to attract and hold them profitably
• Powerful force on consumers and society at large

– The power of marketing and the ability of consumer research and analysis to
yield insight into consumer behavior should not be discounted or misused!
21
Consumer Research and Marketing
• Segmentation, targeting and positioning
• Marketing mix (product or service, price, place, promotion)
• Customer value, customer satisfaction, customer retention
Schiffman, Kanuk, Hansen, 2008 22

Market segmentation
• Market segmentation
is an important
aspect of consumer
behaviour
• Market segmentation
delineates segments
whose members are
similar to one another
in one or more
characteristics and
different from
members of other
segments.
Table 1.3 Variables for market segmentation

23
Ensuring segmentation is valid
• Segmentation is only valid when the following characteristics are met
– Consumers within the segment are similar to one another in terms of product needs, and
these needs are different from consumers on other segments
– Important differences among segments can be identified
– The segment is large enough to be profitable
– Consumers in the segment can be reached by an appropriate marketing mix
– The consumers in the segment will respond in the desired way
24
Tools that help marketers become more attuned to their

customers
• Relationship marketing
– building lifetime relationships and bonds between brands and consumers
• Database marketing
– tracking consumers’ buying habits by computer and crafting products and information
tailored specifically to people’s wants and needs
25
EU priorities for consumer policy (1 of 2)
Table 1.4 Ten principles of consumer protection in the EU 26

Source: versions of the brochure are available in 20 European languages at: http://europa.eu.int/comm/consumers/cons_info/10principles_en.htm0
EU priorities for consumer policy (2 of 2)
Table 1.4 Ten principles of consumer protection in the EU (Continued) 27

Source: versions of the brochure are available in 20 European languages at: http://europa.eu.int/comm/consumers/cons_info/10principles_en.htm
Marketing’s impact on consumers
• Do marketers create artificial needs?
• Is advertising necessary?
• Do marketers promise miracles?
It is often said that marketers create artificial needs. Although this criticism is
over-simplified, it is true that marketers must accept their share of the
responsibility for how society develops and what is considered necessary to
have and what is acceptable, nice and fun to do within society.
28
Advertising expenditures in selected economic sectors

(in million euros, 2nd quarter of 2009, Germany)
Energy
Textiles
Drinks
Health sector
Tourism & Gastronomy
Telecommunication
Services
Nutrition
Automobile market
Retail
Media
0,00 200,00 400,00 600,00 800,00 1.000,00

Advertising expenditures in million €
Source:http://de.statista.com/statistik/daten/studie/37682/umfrage/werbung%3A-investitionen-nach-wirtschaftsbereich/
29
Basic rules on commercial communications of the German

Advertising Standards Council (October 2007)
• Commercial communications must abide by the generally accepted values

of society and the prevailing standards of decency and morality. It must
always be borne by fairness in competition and responsibility towards
society. In particular, advertising may
– not abuse the trust of consumers and not exploit a lack of experience or lack of
knowledge
– cause no physical or phycological harm to children and adolescents
– not encourage or tacitly tolerate any form of discrimination based on race,
national origin, religion, sex, age, disability or sexual orientation or aiming at the
reduction of a sexual object
– not encourage or tacitly tolerate any form of violent, aggressive or antisocial
behavior
– not creat fear or use misfortune and suffering as instrument
– not encourage or tacitly tolerate the behaviors that endanger the consumer‘s
security
30
Voluntary rules of conduct by the German Advertising Standards

Council
• Advertising with and in front of children
• Advertising of alcoholic beverages
• Vilification and discrimination
• Advertising with pictures of accident risk
31
Chapter 2:
A Framework for Consumer Analysis

Three Elements for Marketing Strategy
33
Consumer Affect and Cognition
• Mental responses consumers exhibit toward stimuli and events in their

environment
– Affect
• Refers to feelings about stimuli and events
• Responses can be favorable or unfavorable
• Responses can vary in intensity
– Cognition
• Refers to thinking
• Mental structures and processes involved in thinking, understanding, and
interpreting stimuli and events
• Aspects of cognition are conscious and automatic
34
Consumer Behaviour
• Behavior-Physical actions of consumers that can be directly

observed and measured by others
– Also called overt behavior
– Critical for marketing strategy
35
Consumer Environment
• Everything external to consumers that influences what they think, feel, and
do
• Includes:
– Social stimuli
– Physical stimuli
• Important to marketing strategy because it is the medium in which stimuli

are placed to influence consumers
36
Relationships among Affect and Cognition, Behaviour, and

the Environment (1)
• Each of the three elements:
– Can be either a cause or an affect on a change in one or more of the other
elements
– Represent a reciprocal system
• Viewing consumer processes as a reciprocal system has five implications:

– All three elements and their relationships must be considered in a
comprehensive analysis
– Any of the three elements may be the starting point for consumer analysis
– View is dynamic; recognizes that consumers can continuously change
– Consumer analysis can be applied at several levels
– Highlights the importance of consumer research and analysis in developing
marketing strategies
37
The Role of Consumer Research and Analysis in

Marketing Strategy
38
Marketing strategy
• A set of stimuli placed in consumers’ environments designed to

influence their affect, cognition, and behavior
• Treated as the hub of the wheel of consumer analysis

– A central marketing activity
– Designed by marketing organizations to influence consumers
• Marketing strategies should be designed not only to influence

consumers but also to be influenced by them
39
Summary
• Overall framework for the analysis of consumer behavior was presented
• A general approach to developing marketing strategies intended to

influence consumers’ affect and cognition, behavior, and environments
was described
• The framework presented should aid in understanding the many

complexities of consumer behavior
40
Study Questions
• Explain consumer affect and cognition, behavior, and the environment.

Why does consumer research need to consider all three?
• Explain the relationship between consumer environments and marketing

strategy.
• Look up information on income and age composition in different European

countries (See e.g., Eurostat, 2009. Consumers in Europe.)
http://epp.eurostat.ec.europa.eu/portal/page/portal/product_details/publication?p_product_code=KS-DY-09-001
For what level of consumer analysis would that information be useful.
41

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Technische Universität München

Introduction to Consumer Behaviour and

• Understand the role of consumption processes in society

• Understand approaches to consumer behavior research

• Understand critical aspects regarding ethical issues in marketing

Three Elements for Marketing Strategy

Peter and Olson, 2010 3

What is Consumer Behaviour?

• The dynamic interaction of affect and cognition, behavior, and the

Dynamic Consumer Behaviour

• Thinking, feelings, and actions of individual consumers, targeted consumer

• Requires ongoing consumer research and analysis of important trends

• Makes development of marketing strategies difficult and exciting

Consumer Behaviour Involves Interactions

• Interactions among people’s thinking, feelings and actions, and the

• Marketers need to understand

Role theory and consumer behaviour

• Consumer behaviour resembles actions/roles in plays

Consumer behaviour is a process

Consumer Behaviour Involves Exchanges

• Exchange between people involves giving up of something of value and

• Role of marketing in society is to help create exchanges by formulating and

The Study of Consumer Behaviour

• The study of the processes

Figure 1.2 The pyramid of consumer behaviour, Solomon 2010

Consumer behaviour (continued)

• The field of consumer behaviour is interdisciplinary; it is composed of

• These disciplines can be categorized by the degree to which their focus is

The issue of strategic focus (1 of 2)

Table 1.1 Interdisciplinary research issues in consumer behaviour

The issue of strategic focus (2 of 2) (continued)

Table 1.1 Interdisciplinary research issues in consumer behaviour (Continued)

Perspectives on consumer behaviour

• There are many perspectives on consumer behaviour, but research

– The Interpretivist perspective, in contrast, stresses the subjective meaning of

Two perspectives on customer research

Table 1.2 Positivist vs. Interpretivist approaches to consumer behaviour

Paradigms of consumer behaviour research

S Laws/Function R Black box Model:

Source: Balderjahn & Scholderer, 2007. 16

Relationship among Action-Oriented Groups in Consumer

Uses of Consumer Behavior Research

• Three groups use knowledge about consumer behavior and consumer

– Government and political organizations

Actors in the consumption play

• Organizations (different company agents, and the family for example)

Consumer Behaviour’s Role in Marketing Strategy (1)

– Design, implementation, and control of a plan to influence exchanges to achieve

– In consumer markets, these are designed to

Consumer Behaviour’s Role in Marketing Strategy (2)

• Marketing strategies involve developing and presenting marketing stimuli

• Essence of marketing strategy is to understand markets, develop and

• Powerful force on consumers and society at large

Consumer Research and Marketing

• Segmentation, targeting and positioning

• Marketing mix (product or service, price, place, promotion)

• Customer value, customer satisfaction, customer retention

Schiffman, Kanuk, Hansen, 2008 22

Table 1.3 Variables for market segmentation

Ensuring segmentation is valid

• Segmentation is only valid when the following characteristics are met

– Important differences among segments can be identified