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INTRODUCTION TO CONSUMER PSYCHOLOGY:Consumer Behavior

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Consumer Psychology (PSY - 514)
VU
Lesson 01
INTRODUCTION TO CONSUMER PSYCHOLOGY
OBJECTIVES:
Definition and Scope of Consumer Psychology
Consumer Behavior
Development of Marketing Concept and the fields of Consumer Psychology and Consumer Behavior
Production Concept
Product Concept
Selling Concept
Marketing Concept
Marketing Concept and the Three Business Leaders
1. Definition and Scope of Consumer Psychology:
Basic Questions
The field of Consumer Psychology seeks to understand that how individuals make decisions to spend their
available resources (time, effort and money) on consumption related items. The important questions facing the
consumer psychologists include:
What do consumers buy?
Why they buy it?
When the buy it?
Where they buy it?
How often they use it?
How they evaluate products after the purchase?
Impact of such evaluations on future purchase behavior
How they dispose off the products?
Psychology
"Psychology is the science of behavior and mental processes"
Consumer
Person who consumes, especially one who uses a product
Purchaser of goods or services
Consumer Psychology
"Consumer psychology is the study of how people relate to the products and services that they purchase
or use".
Consumer psychologists study virtually all psychological and behavioral responses that can occur within the
context of a person's role as a consumer. And consistent with the goals of psychologists from other areas, research
carried out by consumer psychologists is designed to describe, predict, explain, and/or influence consumer
responses to product- and service-related information and experiences.
Research in Consumer Psychology may be used to:
Provide information to companies and consumers on what the public needs or wants
Help an organization (either profit or nonprofit) effectively develop and market products, services, or
ideas
Guide the work of government agencies that are responsible for product safety, identity of brand names,
evaluation of advertising claims, and assessment of ethical marketing practices
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Consumer Psychology (PSY - 514)
VU
Representations in Consumer Psychology
Consumer psychology contains a broad range of theoretical, conceptual, and methodological perspectives.
However, currently the strongest representation comes from researchers in the areas of cognitive psychology,
social psychology, marketing, and advertising.
Social Psychology
Influence of social situations on human mind and thoughts
Cognitive Psychology:
Study of mental representations and information processing
Advertising:
Draw favorable attention to goods or services in a public medium to promote sales
Marketing
2. Consumer Behavior
Consumer behavior is the study of the behavior that consumers display during the processes of searching for,
purchasing, using, evaluating, and disposing of products and services that they expect will satisfy their needs.
Consumer Behavior describes two kinds of consuming entities:
The Personal Consumer and;
The Organizational Consumer
Personal Consumer
Buys goods for his/her own use, for the use of household or as gift for friends/families
Organizational Consumer
Includes profit and not-for-profit businesses, government agencies and institutions
3. Development of Marketing Concept and the Disciplines of Consumer Psychology and
Consumer Behavior
The fields of Consumer Psychology and Consumer Behavior are rooted in the development of Marketing
Concept, a business Orientation that evolved in the 1950's through several alternative approaches toward doing
business, referred to, respectively, as the production concept, product concept and the selling concept.
A. Production Concept:
Focus
Cheap, efficient production and intensive distribution
Basic Assumption
Consumers are more interested in obtaining the product than they are in specific features
Problem
Ignored the consumers in terms of required product features
B. Product concept:
Focus
The product
Strive constantly to improve the quality of product and add new features that are technically feasible
Basic Assumption
Consumers will buy products that offer them the highest quality, best performance and the most features
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Consumer Psychology (PSY - 514)
VU
Problem
Product Orientation ignores whether or not the consumers really want the new features
C. Selling concept:
Focus
Needs of sellers
Sell the products that a company makes
Profit through sales volume
Basic Assumption
Consumers are unlikely to buy a product unless they are aggressively persuaded
Problem:
Fails to consider customer satisfaction, Customers are induced to buy products; they do not want or need
D. Marketing Concept
Focus
Needs and wants of customers
Profits through customer satisfaction
Basic Assumption
Determine needs and wants of specific target markets and deliver the desired satisfaction better than the
competition
4. Development of Marketing Concept
Three Business Leaders
A. Alfred P. Sloan
Founder Chairman, General Motors
Company Strategy:
"A car for every purse and purpose"
Product Innovation:
Cars for rich people
Cars for poor people
Innovative Marketing Concept:
Market Segmentation
B. Colonel P. Sanders
Founder, Kentucky Fried Chicken (KFC)
Company Strategy:
Re-engineer the public perception of a
Motel
Innovation Marketing Concept:
Franchise the cooking methods and chicken recipe
Product Repositioning
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Consumer Psychology (PSY - 514)
VU
C. Ray Korc
Partner, McDonald Brothers
Company Strategy:
Thousands of McDonald's outlets in the country
Outlets close to churches to target customers
Innovative Marketing Concept:
Hamburger University, centralized facility to train the company's employees
Market Targeting
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Table of Contents:
  1. INTRODUCTION TO CONSUMER PSYCHOLOGY:Consumer Behavior
  2. INTRODUCTION TO CONSUMER PSYCHOLOGY:Consumer research
  3. INTRODUCTION TO CONSUMER PSYCHOLOGY:Marketing Mix, Product, Price
  4. INTRODUCTION TO CONSUMER PSYCHOLOGY:Customer Value, Perceived Value
  5. VALUE AND RETENTION FOCUSED MARKETING AND CONSUMER DECISION MAKING PROCESS
  6. CONSUMER RESEARCH:Quantitative Research, Qualitative Research
  7. MAJOR STEPS IN CONSUMER RESEARCH PROCESS:Design of Primary research
  8. QUANTITATIVE RESEARCH DESIGNS & DATA COLLECTION METHODS
  9. QUANTITATIVE RESEARCH DATA COLLECTION TECHNIQUES:ATTITUDE SCALES
  10. QUALITATIVE RESEARCH DESIGNS & DATA COLLECTION METHODS
  11. CUSTOMER SATISFACTION MEASUREMENT, SAMPLING, AND DATA ANALYSIS AND REPORTING
  12. MARKET SEGMENTATION AND ITS BASES:Geographical Segmentation
  13. BASES FOR SEGMENTATION: DEMOGRAPHIC SEGMENTATION PSYCHOGRAPHIC SEGMENTATION
  14. BASES FOR SEGMENTATION: SOCIOCULTURAL SEGMENTATION USE RELATED SEGMENTATION USAGE SITUATION SEGMENTATION
  15. BASES FOR SEGMENTATION: BENEFIT SEGMENTATION:Intrinsic Cues
  16. BASES FOR SEGMENTATION: HYBRID SEGMENTATION STRATEGIES
  17. MARKET SEGMENTATION IMPLEMENTING SEGMENTATION STRATEGIES ENVIRONMENTAL INFLUENCES CULTURE
  18. HOW CULTURE IS LEARNT ENVIRONMENTAL INFLUENCES:Formal Learning
  19. CULTURE AND ITS MEASUREMENT ENVIRONMENTAL INFLUENCES
  20. MEASUREMENT OF CULTURE ENVIRONMENTAL INFLUENCES:Consumer Fieldwork
  21. SUBCULTURE CHAPTER 4: ENVIRONMENTAL INFLUENCES
  22. AGE AND GENDER SUBCULTURE CHAPTER 4: ENVIRONMENTAL INFLUENCES
  23. BASES FOR SEGMENTATION: BENEFIT SEGMENTATION:Market Segmentation
  24. SOCIAL CLASS CHAPTER 4: ENVIRONMENTAL INFLUENCES:Occupation
  25. CONSUMER SOCIAL CLASSES CHAPTER 4: ENVIRONMENTAL INFLUENCES:Affluent Consumer
  26. CONSUMER SOCIAL CLASSES CHAPTER 4: ENVIRONMENTAL INFLUENCES:Membership Group
  27. CONSUMER SOCIAL CLASSES CHAPTER 4: ENVIRONMENTAL INFLUENCES:Shopping Groups
  28. UNDERSTANDING PERSONALITY CHAPTER 5: INDIVIDUAL DETERMINANTS OF CONSUMER BEHAVIOR
  29. CONSUMER PERSONALITY, TRAIT THEORY AND SELF IMAGES
  30. CONSUMER MOTIVATION:Needs, Goals, Generic Goals
  31. UNDERSTANDING LEARNING:Intentional and Incidental Learning, Implications for Marketers
  32. INSTRUMENTAL CONDITIONING, INFORMATION PROCESSING AND MEMORY
  33. ATTITUDES:Characteristics of Attitudes, Attitudes have consistency
  34. ATTITUDE FORMATION AND CHANGE:How attitudes are learned?
  35. ATTITUDE CHANGE STRATEGIES:Resolving two conflicting attitudes
  36. INTRODUCTION TO CONSUMER DECISION MAKING:Decision Complexity
  37. Problem Recognition, Search and Evaluation and Decision and Purchase
  38. Decision and Purchase:Consumer Decision Rules, Output, Relationship Marketing
  39. Decisions Related to Post Purchase:Product Set up and Use
  40. Marketing Implications of Decisions Related to Post Purchase:Understanding
  41. Post Purchase Evaluation:Determinants of Satisfaction, Consumer Complaint Behavior
  42. Post Purchase Dissonance:Dissonance Reduction, Marketing Implications
  43. Consumerism:Roots of Consumerism, The Nature of Consumerism
  44. Consumerism Issues and Responses:Environmental Concerns, Consumer Privacy
  45. Review Consumer Psychology Course:Consumer Research, Consumerism