MKT105 CH - 6

Group Project MKT103
• The aim of marketing projects is to give students an opportunity

to apply marketing concepts learnt in the classroom to a
hypothetical product/service or go deeper into an existing
company or sector and study it from a marketing lens. Students
would be expected to describe marketing elements perspective
like nature of product, marketing mix, competition, pricing
strategies, differentiation and positioning strategies, etc.
Degree of
Innovation Product Market Business model example
0 0 0 0 Provision storer
1 1 0 0 face recognition
1 0 1 0 suger for diabetic patients
1 0 0 1 Uber/Ola 1
2 1 1 0 Tikka flavour by Mcdonalds
3 1 1 1 Google
Chapter 6
Analyzing Consumer Markets
2
What Influences Consumer
Behavior?
Cultural Factors
Social Factors
Personal Factors
3
What is Culture?
Culture is the fundamental determinant of a
person’s wants and behaviors acquired through
socialization processes with family and other key
institutions.
4
Subcultures
Nationalities
Religions
Racial groups
Geographic regions
5
Social Classes
• Upper uppers
• Lower uppers
• Upper middles
• Middle class
• Working class
• Upper lowers
• Lower lowers
6
Social Factors
Reference Family
groups (Family of orientation
Family of Procreation)
Cliques
(small groups whose
members communicate
Role & Status
frequently )
7
Reference Groups
• Membership Groups
• Primary Groups
• Secondary Groups
• Aspirational Groups
• Dissociative Groups
8
Personal Factors
Age
Self- Life cycle
Concept stage
personality Occupation
Values Wealth
Lifestyle
9
Model of Consumer Behavior
10
Key Psychological Processes
Motivation Perception
Learning Memory
11
Motivation
Maslow’s Herzberg’s
Freud’s Hierarchy Two-Factor
Theory of Needs Theory
Behavior Behavior Behavior is

is guided by is driven by guided by
subconscious the lowest, motivating
motivations unmet need and hygiene
factors 12
Freud’s theory of motivation
13
Maslow’s Hierarchy of Needs
14
Perception
A process by which we select, organize, and interpret
information/inputs to create meaningful picture of
the world
• Selective attention
– Voluntary attention – purposeful
– Involuntary attention – grabbed by something
• Selective retention
– Information that supports our attitudes and beliefs
• Selective distortion
– Interpret information the fits our perception
• Subliminal perception
– Subtle subconscious effects
Memory
• Short term memory
• Long term memory
• Memory Processes:
• Memory encoding
• Memory Retrieval
16
Consumer Buying Process
Problem Recognition
Information Search
Evaluation
Purchase Decision
Postpurchase 17
Behavior
Information Search
• Sources of Information
• Personal
• Commercial
• Public
• Experiential
• Search Dynamics
18
Three Primary motivational conditions
1. Low involvement
2. High involvement - utilitarian
3. High involvement – ego-expressive
Cont..
Perceived Risk
• Functional Risk
• Physical Risk
• Financial Risk
• Social Risk
• Psychological Risk
• Time Risk
21
22
Compensatory Model of choice
• Consumers rank products based on the total of their characteristics.
• Eg. You are interested in four attributes while buying a laptop

They are: memory capacity, graphics capacity, size and weight
Laptop A: .4*8 + .3*9 + .2*6 + .1*9 = 8

Laptop B: .4*7 + .3*7 + .2*7 + .1*7 = 7
Laptop C: .4*10 + .3*4 + .2*3 + .1*2 = 6
Laptop D: .4*5 + .3*3 + .2*8 + .1*5 = 5
What does a marketer do in such situation?

- Redesign?
- Alter benefits about the brand? Psychological repositioning
- Alter benefits about competitor’s brand? Competitive dispositioning
- Alter the importance weight?
- Call attention to neglect attributes 23
- Shift the buyer’s ideals
24
Understand the consumer behavior
• Decision making unit - Who bought the product/ made the
decision?, Who all influenced the decision?
• Motivation behind purchase - What motivated the purchase?
(any problems? any Attributes?)
• Characterize the decision - Was it a first time decision?/A
review of a previous decision? / A careful decision? / A casual
decision?
• The decision making process - What triggered the process? /
what information was gathered? How many alternatives?
How was the final choice determined?
• From where did the consumer buy? – Why there? Which
came first? – Where to buy or what to buy? 6-25
Non-Compensatory Models of Choice
In the evaluation stage, the consumer takes mental shortcuts
also called as ‘heuristics’ in the decision making process.
• Conjunctive: minimum acceptable cut-off levels for each

attributes
• Lexicographic: Best brand for the perceived most important
attribute
• Elimination-by-aspects: eleminate brands that do not meet
the cut-off levels
26
Perceived Risk
• Functional Risk
• Physical Risk
• Financial Risk
• Social Risk
• Psychological Risk
• Time Risk
27
Post-Purchase Behavior
• Post-purchase Satisfaction
• Post-purchase Actions
• Post-purchase Uses & Disposal
28
Other Theories of Consumer Decision
Making
• Decision heuristics
• Availability
• Representativeness
• Anchoring & Adjustment
• Framing
• Mental Accounting
• Segregate gains
• Integrate losses
• Integrate smaller losses and larger gains
• Segregate smaller gains from larger losses
29

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MKT105 CH - 6

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Group Project MKT103

• The aim of marketing projects is to give students an opportunity

Behavior Behavior Behavior is

• Eg. You are interested in four attributes while buying a laptop

Laptop A: .48 + .39 + .26 + .19 = 8

What does a marketer do in such situation?

• Conjunctive: minimum acceptable cut-off levels for each

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