Consumer Behaviour, 1st Australia and New Zealand Edition

Preface viii

About the authors ix

Chapter 1Introduction: consumers arekey to a company’s success 1

Introduction 2

Consumer behaviour as a multifaceted phenomenon 2

The buyer–seller interaction 4

Needs 4

Wants 4

Demand 6

Exchange 6

Transaction 7

Post‐purchase behaviour 8

Why is consumer behaviour so challenging? 9

The way consumers shop keeps changing 9

The way consumers fulfil their needs keeps changing 9

The way consumers communicate with other consumers keeps changing 9

Those with whom consumers communicate keeps changing 10

Summary 11

Key terms 11

Exercises 12

Endnotes 12

Acknowledgements 13

Chapter 2 Consumers’ insights as drivers of marketing strategies 15

Introduction 16

Successful businesses provide solutions 16

Consumer‐centric strategy 16

What to offer consumers: a unique value proposition 17

How to craft a successful unique value proposition 18

What value proposition should companies choose? 19

Finding the right consumer: segmentation, targeting and positioning 20

Segmentation 21

Targeting 25

Positioning 28

How to get the product to the consumer: the marketing mix 31

Product strategy 31

Price strategy 31

Place strategy 32

Promotion strategy 32

Beyond the 4 Ps: the 4 Cs of the marketing mix 33

Summary 35

Key terms 35

Exercises 36

Endnotes 36

Acknowledgements 37

Chapter 3 How (and why) to listen to consumers 39

Introduction 40

Listening to consumers as a marketing strategy 40

Kinds of marketing research data 40

Secondary data 41

Types of primary data collection 43

Big data 46

Marketing analytics 47

Consumer insights partners 50

Summary 51

Key terms 51

Exercises 52

Endnotes 52

Acknowledgements 53

Chapter 4 How consumers make decisions 55

Introduction 56

Consumer decision making 56

Inside the black box 56

Problem recognition 57

Information search 59

Level of engagement in the information search 61

Product‐related factors 61

Consumer‐related factors 61

Situation‐related factors 62

Evaluation of alternatives 63

Evaluative criteria 64

Purchase decision 65

Making decisions about a new product 67

Summary 70

Key terms 70

Exercises 71

Endnotes 72

Acknowledgements 73

Chapter 5 Post‐purchase behaviour 75

Introduction 76

Understanding post‐purchase behaviour 76

Consumer satisfaction and dissatisfaction 76

Cognitive dissonance 76

Measuring consumers’ satisfaction 78

Consumers’ satisfaction on social media 79

Consumer loyalty 79

The Apostle model 79

Measuring consumer loyalty 81

Loyalty rewards programs 82

Measuring the effectiveness of loyalty rewards programs 83

Word‐of‐mouth messages and complaints 84

Complaints 86

Disposal of products 86

Summary 89

Key terms 89

Exercises 90

Endnotes 91

Acknowledgements 92

Chapter 6 The irrational consumer: biases and situational effects on consumers’ decision making 93

Introduction 94

The irrational consumer 94

Heuristics and cognitive processing 94

Importance and difficulty in the purchasing decision 95

Customer segment differences in purchasing decisions 96

Heuristics and potential decision‐making biases 96

Context effects 97

Framing 98

Reference dependence or the role of a comparison 99

Gains and losses and prospect theory 99

Nonconscious information processing 102

Consumer segments 102

Situational factors 104

Time: time crunch and seasonality 104

Who is the purchase for? 106

Retail ambience 106

Consumer antecedents 108

Summary 110

Key terms 110

Exercises 111

Endnotes 111

Acknowledgements 112

Chapter 7 Consumer motivation and emotions 113

Introduction 114

Motivation 114

The dynamic nature of motivation 115

Maslow’s elaborated hierarchy of needs 118

McClelland’s needs theory 120

Regulatory focus 122

Consumers’ motivations 122

General versus consumer goals 123

How does motivation work? 124

The dynamic of attaining goals 124

Emotions 124

Negative emotions due to not achieving a goal 127

Marketers and consumers’ emotions 128

Evoking emotions as a marketing strategy 128

Measuring emotional marketing 130

Summary 131

Key terms 131

Exercises 132

Endnotes 133

Acknowledgements 134

Chapter 8 Consumers’ perception 135

Introduction 136

How consumers view the world 136

The perceptual process 136

Perceptual input 137

Perceptual selection 140

Perceptual organisation 141

Perceptual interpretation 142

How do marketers use information on consumer perception? 143

Positioning 143

Perceptions about price, quality and value 144

Marketers must manage consumers’ perceptions about risk 147

Summary 149

Key terms 149

Exercises 150

Endnotes 150

Acknowledgements 151

Chapter 9 Learning and memory 153

Introduction 154

Consumer learning 154

Behavioural learning theories 155

Cognitive learning theories 161

Involvement theory and its effect on consumer learning 164

Memory 165

Attention, encoding, storage and retrieval 165

Summary 169

Key terms 169

Exercises 170

Endnotes 170

Acknowledgements 171

Chapter 10 Consumer attitude formation and change 173

Introduction 174

Attitudes 174

Types of attitudes 175

The components of attitudes 176

How do attitudes form? Where do they come from? 178

Attitudes and consumer behaviour 179

Variants of attitude models 180

Attitudes and types of purchases 180

What functions do attitudes serve? 181

Can marketers change consumers’ attitudes? 183

Theories of attitude change 185

Balance theory 186

Measuring success in changing attitudes 187

Using social media to affect consumers’ attitudes 187

Summary 188

Key terms 188

Exercises 189

Endnotes 189

Acknowledgements 191

Chapter 11 Consumer personality and self‐concept 193

Introduction 194

Personality 194

Theories of personality 195

The psychoanalytic perspective 195

The humanistic perspective 196

The trait perspective 196

Do brands have personalities? 198

Self‐concept 199

The structure of self‐concept 201

Types of self‐concepts 202

Possessions as an extension of the self 203

Consumer values 204

So how does this affect marketers? 205

Summary 206

Key terms 206

Exercises 207

Endnotes 207

Acknowledgements 208

Chapter 12 Consumers’ social and cultural context 209

Introduction 210

Reference groups 210

Different bases of reference groups 211

Individual diversity 211

Age and generational cohorts 212

Gender 213

The family and stages in the household life cycle 215

Social class and socio-economic status 217

How subcultures work 219

Desire for conformity and desire for uniqueness 219

Race and ethnicity 221

Area of country 221

Summary 223

Key terms 223

Exercises 223

Endnotes 224

Acknowledgements 225

Chapter 13 The global consumer 227

Introduction 228

Going global? 228

Exploring global options 229

Demographic segmentation 229

Selecting a global market to enter 231

Internal factors 231

External factors 232

Cultural distance 233

Economic distance 236

Political and legal distance 237

Deciding how to enter the market 237

Timing of the entry 237

Scale of the entry 238

Global use social media 238

Mode of the entry 239

Deciding on the marketing mix: how do we market and communicate with these new consumers? 240

Price 245

Channels of distribution 245

Developing global brands 247

The local level 247

The international level 247

The global level 247

Global brands’ positioning 247

Summary 250

Key terms 250

Exercises 251

Endnotes 251

Acknowledgements 253

Chapter 14 Social media 255

Introduction 256

Social media in the context of marketing strategy 256

Targeting and social media profiles 258

What are the brand goals? 260

How to do it? 261

Tactical execution — and how *not* to do it 263

Social networks and influencers 265

Social media analytics 268

Email marketing 269

In close 270

Summary 272

Key terms 272

Exercises 273

Endnotes 273

Acknowledgements 274

Chapter 15 Do-good consumption 275

Introduction 276

‘Do good’ as a strategic decision 276

Corporate social responsibility 278

Ethics 279

Deontological ethics 279

Teleological ethics 279

Ethics and marketing 280

Ethics and marketing for companies 281

Ethics and marketing for consumers 284

Ethics and consumer segments 285

A ‘dark side’ or ‘doing bad’? 286

Is CSR and doing good actually valued by consumers? 286

Summary 288

Key terms 288

Exercises 288

Endnotes 289

Acknowledgements 290

Index 291