3.1 Theory of mind
By examining the ‘theory of mind’ it is clear to see that marketing works on two levels at the same time. Even as marketers succeed in influencing or persuading consumers to do one thing, they are at the same time sending powerful signals as to their motives and intentions. If these motives and intentions are not deemed trustworthy, they trigger ‘revenge’ responses. Even as marketing’s persuasion paradigm appears to work by influencing consumer decisions it is, at the same time, undermining trust and building resistance.
3.2 The decision making process
Most human mental activity and decision-making are indeed unconscious. This is a by-product of our evolutionary past. Brains and nervous systems did not develop for the purposes of thinking ‘rationally’. They developed to help organisms survive, so they are geared to the survival imperatives of sensing and fleeing danger (or fighting), and of sensing and approaching opportunities, for food and sex for example. The way these instincts work is not via some sort of artificial intelligence if-then computer programme. We are wetware, not hardware and software. Our decisions are mediated by a chemical soup of hormones, neurotransmitters and the like, which we mostly feel as emotions: fear, a desire for safety and security, desire for food etc.
What this means is that every decision we make rests on, and is mediated by, these survival-oriented and unconsciously generated emotions and instincts. So, unconsciously, our mind is always sending us ‘flee’ or ‘approach’ signals which make us feel uncomfortable or comfortable with certain situations and decisions. We know these almost primeval prompters are important because people with brain damage to the parts of the brain that process them find it almost impossible to make even the most basic of everyday decisions.
Therefore, most consumer decision-making is predetermined by strong, influential unconscious processes. This is not the same as saying that the resulting decisions are ‘irrational’ and that people’s decisions are therefore stupid. Far from it, most of these decisions are actually very sensible. These instinctive processes and responses evolved to ensure the survival of our species.
4. Consumer influences
The are many environmental influences that can effect an individuals decision making process, such as anthropological, personal, social, cultural, economic and geographical. The link between personal preferences, consumption, and the demand curve is one of the most complex relations in economics. Implicitly, economists assume that anything purchased will be consumed, unless the purchase is for a productive activity.
Consumer influences can be divided into two key factors, cultural factors and social factors. Cultural factors are the most basic cause of an individual’s wants and behaviour. The family environment plays a key role in how an individual inherits and learns basic perceptions and wants.
Subcultures are groups of individuals with similar tastes and views, for example, the same tastes in music, fashion etc. This shared value systems based on common life experiences and situations. This is similar to nationality groups. The Ethnic background/ heritage of an individual dictates a globally unique tastes and interests and religion.
Social classes have always existed in society and is not determined by multiple factors; occupation, education, income and personable variables.
Social factors also influence consumer behaviour, for example friends, family, social roles and status. An individual‘s behavior is influenced by memebrship groups, i.e.a group to which an individual belongs. These serve as direct or indirect points of comparison or reference in the forming of a person’s attitudes or behaviour.
Family - family members can strongly influence buyer behaviour. Parents pass on their views/beliefs on religion, politics, and economics as well as love and a sense of belonging. The (nucleur) family is the most important consumer group in society. Marketers are interested in the purchasing relationship a wide variety of goods and services.
An individuals purchasing behaviour is influenced by four major psychological factors:
- Motivation
- Perception
- Learning
- Beliefs & attitudes
An individuals motivation n has many needs at any given time. Some needs are biological, arising from states of tension such as hunger, thirst, or discomfort. Other needs are psychological, arising from the need for recognition, esteem, or belonging.
Perception depicts how an individual acts and how is influenced by his or her perception of the situation.
Learning changes an individual’s attitudes and or beliefs by drawing from experience. Beliefs & Attitudes are inherted from the people around them. These in turn effect their purchasing pattern. Marketers are interested in the beliefs that people formulate about specific products and services. things, moving toward or away from them.
5. Marketing
Companies sell their products to consumers via marketing. This practice helps the company achieve its goal of selling its product(s) – to the consumer.
Marketers need to understand the impact that economic, demographic and social & cultural trends that influence consumer in order to cerate long-term strategic planning. According to East Roberts (1997), consumer behaviour is about human responses to the commercial world, how and why people buy products.
The aims of marketing are:
- Identify actual/potential wants in the marketplace.
- Determining the offering to match the want.
- Making the offering available
- Persuade Market audience to buy / re-buy.
- Deciding on a continuing basis what and how to improve
- Cooperative with others to secure resource & marketing plans
5.1 Marketing in the role of consumer needs
When people feel a ‘need’, they are motivated to take action to fulfil it. In many instances, purchase of a good or service may be seen as offering the best solution to meeting a particular need. The Abraham Maslow hierarchy theory (1947), examines the consumers’ needs. “Needs are subconscious, deeply felt desires that often concern long-term existence and identity issues”. Engel, Blackwell & Miniard (1995) all identified how involvement factors affect cognitive activity . There are many layers to the process of decision making. An individuals psychological need can be shown in the hierarchy table as featured below:
Hunger and thirst are the first basic needs of any individual. Secondly, safety needs such as health, income and job security are also needs. Social needs come in the next level of the hierarchy, the need to belong or be loved / belong.
The esteem need is the need for “status”. Marketers realised that by combing “status” around their products, that consumers simply will buy it not because of what the product has to offer itself, but more importantly because of the social signals it sends.
The self–actualisation need embodies the individuals, problem solving, prejudices, spontenituty, creativeness and motivation. From the point of view of a social animal trying to prosper within a competitive pecking order, it makes some sense. Such decisions may be “irrational”. We human beings are influenced by many such ‘irrational’ but understandable instincts and marketers have become adept to appealing them. This theory provides a good guide for marketers to understand their consumers.
By examining instinctive decision-making and its connections to primeval concerns of safety, security etc we arrive at an important conclusion. The consumer feels safer and more secure with things that are of the familiar, that which we have become used to and are no longer seen as a threat. Therefore, Marketing tries to familiarise the consumer with their brands via advertising in order to create a preferences other rival, and thus unfamiliar brands. Given the choice between the familiar and the unfamiliar, most of us choose the familiar. This is one of the reasons why advertising ‘works’; why it is often effective in influencing consumer decisions whether they aware of the process or not.
However, the game changes when the consumer is equally familiar with two brands, resulting in a Marketers nightmare. The influencing ability of the brand awareness is no longer enough.
More awareness will not prompt us to choose one over the other; awareness alone does not determine the outcome of consideration.
5.2 Brand image & loyalty
The process of branding originated as a means for firms to differentiate their goods or services (hereafter referred to as products) from those of competitors (Cowley, 1991). A brand can be a company, product / service which can be represented in a form of a design, term or logo. In today’s modern society, a brand can represent image, lifestyle, economy, as well as social and cultural philosophies. “A brand name is a major company asset and product naming practices are of a strategic importance”.
In today’s society, ‘image is everything’. Brands can now represent groups of people, whether it be fashion, music etc. Brands must and need to listen to their customers, so that they consume their products. This product catering, focusing has meant that certain brands belong and are affiliated with consumer group’s taste. This brand image is reflected within all walks to society, from the rich to the poor. By wearing certain clothes and listen to certain music, consumers reflect their (shared) “identity”.
Brands can give groups of people a sense of belonging as shown in the for mentioned consumer theory. Brand identity is ‘a unique set of brand associations that the brand strategist aspires to create or maintain’.
Brand loyalty can be equated with Brand image. New products can be released onto the market under an established brand. It is important that marketers listen to their consumer market; after all, brand loyalty equals profit.
The current marketplace is forever increasing in terms of competitiveness. In recent years, there has been a steady decline in customer loyalty to traditional brands (McAlexander and Schouten, 1998; Seth, 1998).
5.3 Understanding and influencing consumer behaviour
The way that marketing / advertising affects consumers varies form person to person. One of the best ways to stimulate consumer behaviour is to give a positive motive, i.e. evaluating consumer behaviour. Consumers want to feel they are doing something good, being a good person, eating healthy etc. If marketers can convince consumers that they need a product or service for a legitimate reason, the chance that a customer will make a purchase increases.
Marketers can make products more attractive by:
- Price incentives
- Advertising
- Launching new products
When placing any product in the marketplace, marketers need to make use of the following marketing mix:
- Using the most suitable promotion.
Firstly, a product has to have the right features for its target consumer. Secondly, the price is dictated by the economy of scale; based on the income of the target consumer. The product has to be in ‘the right place at the right time’. Making sure that the goods arrive when and where they are wanted is an important operation. Lastly, the target group needs to be made aware of the existence and availability of the product through promotion.
Marketing research has shown that psychological and social sciences play an important role in advertising products. There are four types of consumer purchasing:
- High Involvement purchasing.
- Low involvement consumption.
- Involuntary consumption.
- Group consumption (influences DMU).
All products and services can be broadly divided into the two categories: High Involvement and Low Involvement. The high involvement purchases will have more involvement from the consumer. These products / services are usually costlier and or riskier purchases (e.g. buying a car) and so require more thought and where necessary, some research. This is because the consumer often needs assurance that they are doing the ‘right’ thing and that the risk is low. High involvement products/services also enjoy a high brand loyalty.
Low involvement products/services are repetitive purchases. Washing up liquid, and toothpaste are examples of low involvement purchases. The consumers buy these products repetitively, but does not necessarily buy the same brand. Some services, e.g., the dentist is not a service consumers enjoy and are not immediately associated with having a brand. This shows that low involvement products are difficult to market.
Products that fall into the category of involuntary purchases are for example petrol. Some individuals need petrol in order to travel to work. Group consumption is influenced by the “decision making unit” (DMU). Families / households are an example of DMU’s.
Consumer behaviour, intensity, refers to whether a customer's interest in a product is compelling enough that they will go out and make the purchase. Good marketing can be intense. A successful example of such a campaign was Marks & Spencer’s “this is no ordinary food” campaign, whereby television viewers were treated to an onslaught of delicious looking food including Sunday roast dinners, on a Saturday night, which compelled viewers to shop at Marks & Spencer’s. Understanding consumer motivation is the best way to increase buyer incentive, as well as a better alternative to e.g. decrease prices.
Post purchase behaviour is an equally important part of the purchasing process. According to FSA research, there is a rising trend amongst consumers regarding post purchase regret. It is crucial that marketers make their consumers to feel proud of all their purchases. Proper branding with advertising should provide confidence to consumers that their purchases are from a strong and reputable organisation. This limits post purchase behaviour.
6. Conclusion
For all businesses strategic planning is a necessity and cannot be achieved without a key understanding of consumer behaviour. It is the key to looking to the future and creating a direction intentionally as opposed to simply reacting to the marketplace. In today’s fast-paced marketplace, strategic planning helps company leaders maintain their sanity and build a company based on the values that matter most to them.
It is not only key for Marketers to take advantage of the human condition known as ‘irrationality’, but it is important that marketers examine to the aforementioned trends in society so that they can market their products affectively. It is arguable that this mission is harder and harder to undertake, as consumer influences are growing as trends come and go at an ever increasing rate.
From the consumer’s point of view, there is potential value in services that help them make better decisions, despite their proven “irrationality”. Whether or not consumers know what they do and don’t want in uncertain and form this research there is no indefinite answer, but there are many theories that help explain how what consumer actions are driven by. Unfortunately, all theories and test cases only focus on the masses. Each individual consumer thinks differently and still most actions are unpredictable.
Therefore with ever increasing factors such as greater choice,
However, the net effect of these bigger doses is usually counterproductive: they build consumer resistance to marketing (thereby leading to increased cost and complexity) while undermining trust.
Bibliography
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Schiffman, L.G. (1993), Consumer Behaviour, Prentice Hall International, London.
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East Robert (1997), Consumer Behaviour: Advances & Applications in Marketing.
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James F. Engel, etc., R.D. Blackwell, and P.W. Miniard (1995), Consumer Behaviour.
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C. Lovelock and L. Wright (2002), Principles of service marketing and management.
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Kant, Hegel, Schopenhauer, Nietzsche (1997) German Philosophers
Websites / Electronic journals:
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Emily Boyle - Loyalty and brand spaces Journal of Strategic Marketing (June 2006)
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David Mercer - Long-range marketing (2009)
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Anil Mathur, George P. Moschis, Euehun Lee - Stress and consumer behaviour - Coping strategies of older adults (2009)
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Tyler K. Perrachione & John R. Perrachione - Brains and brands: Developing mutually informative research in neuroscience and marketing
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Melissa Tyler – Growing customers - Journal of Consumer Culture, Volume 9, Number 1 (March 2009)
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Tim Lang & Yiannis Gabriel – New faces and masks of today’s consumer- Journal of Consumer Culture, Volume 8, Number 3 (November 2008)
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Marketing, the consumer society & hedonism –John O’Shaughnessy & Nicholas Jack O’Shaughnessy (2002)
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Emily R. Murphy, Judy Liles & Peter B.Reiner –Journal of consumer behaviour - Neuroethics of Neuromarketing - (2008)
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http://
- http://www.fsa.gov.uk/pubs/consumer-research/crpr77.pdf
Kant, Hegel, Schopenhauer, Nietzsche (1997) German Philosophers
East Robert (1997), Consumer Behaviour: Advances & Applications in Marketing (p9)
Marketing, the consumer society & hedonism –John O’Shaughnessy & Nicholas Jack O’Shaughnessy (2002)
C. Lovelock and L. Wright (2002), Principles of service marketing and management (p80)
James F. Engel, etc., R.D. Blackwell, and P.W. Miniard (1995), Consumer Behaviour
Emily Boyle - Loyalty and brand spaces Journal of Strategic Marketing (June 2006)
East Robert (1997), Consumer Behaviour: Advances & Applications in Marketing (p47)
Emily Boyle - Loyalty and brand spaces Journal of Strategic Marketing (June 2006)
Emily Boyle - Loyalty and brand spaces Journal of Strategic Marketing (June 2006)
http://www.fsa.gov.uk/pubs/consumer-research/crpr77.pdf