Consumer Behaviour
Trends in consumer behaviour
Trend = tendency in which certain products, subjects or ideas find increasing acceptance in a
growing section of the population. They indicate the preferences and values of consumers.
Causes of trends can mostly be found in societal and psychological social
developments.
There are four levels of trends:
1. Societal trends -> on a long term (10-30 years), in a macro context. Has an impact on
the entire society.
The DESTEP-model has interrelated domains in which societal trends can be found:
D emographic -> e.g. aging society, single parenting
E conomic -> e.g. inflation, spending, unemployment
S ocio-cultural -> e.g. social engagement, sharing lifestyle
T echnological -> e.g. information society, development of new jobs, VR
E cological -> e.g. climate change, sustainability
P olitical -> e.g. relationships & stability, elections, Brexit
Can lead to countertrends: regionalization vs globalization, socialization vs
individualization, humanizing vs de-humanization, etc.
2. Consumer trends -> tendency in the behaviour of consumers, which is unrelated to a
specific market domain and therefore more general. Consumer trends are strongly
related to psychological-social developments. They have a shorter term of impact (5-
10 years). E.g. healthy living, environmental consciousness, ethical behaviour (BLM).
3. Market trends -> trends in 1 specific market domain/industry e.g. food, tourism, etc.
In the food market: development of the vegan market. In tourism: sustainable
tourism, bleisure, personalization, solo-travel, etc.
4. Product trends -> a tendency in sudden preference for specific products. E.g. vegan
products, sustainable bikes, electronic cars, etc.
All the four trend domains are interrelated with each other, for example:
Healthy society (S) -> wanting to stay fit (C) -> active holidays (M) -> active products (P)
The relation between trends can be expressed in a trend pyramid. You start at the
top (P), and see what kind of market, consumer and societal trends are the base of
this product trend. But; you can start from the bottom (S) as well.
Chapter 8 Decision-making
Every consumer decision we make is a response to a problem.
Some decisions are more important than others, weigh pros and cons or let our
emotions decide.
,Purchase momentum => initial impulse purchases increase the likelihood that we will buy
even more.
Consumer hyperchoice = too many choices to choose from. This can lead to choosing an
avoidant option to avoid long decision processes.
Constructive processing = we evaluate the effort needed to make a decision.
Mental budget = calculating how much we consume over time.
Three categories of product choice:
– Cognitive
– Habitual
– Affective
With self-regulation, we specify how we want to react to certain situations and how much
weight we give to information.
This doesn’t always work, sometimes we give up on a strategy. Planning itself can
undermine our ability to attain goals, unsatisfying progress can lead to loss of self-
control.
Extended problem solving = cognitive decision making, finding as much information as
possible to avoid risks. Involves internal and external research.
Limited problem solving = straightforward and simple, we may use short-cuts to simplify.
Cognitive decision making
=> Rational, information-processing perspective. We integrate as much information as
possible and weigh pros and cons.
But: we just gather the information that we really need, and try to find the most
valuable information first so it’s not too time-consuming.
Five steps:
1. Problem recognition
=> When there's a significant difference between our current state (can move
downwards) and a desired/ideal state (can move upwards), which causes a
‘problem’.
Marketeers try to create primary demand, where consumers use a product or
service regardless of the brand they choose.
Secondary demand = when consumers do prefer a specific brand
2. Information search
Two types:
Internal search: based on prior experiences
External search: via ads, media, friends etc.
How much information do we search?
We tend to search more information when its’ an important
decision or when information is easy to find.
, Consumers who are moderately knowledgeable search the most, there’s an
inverted u-relationship between 1. The amount of search and 2. Product knowledge
Conclusion: 1
– Newbies with limited expertise may feel incompetent to search, they focus less on
the details and more on the big picture 2
– Experts tend to engage in selective search, thus more focused and efficient
Online search
Cybermediary = website or app that filters and organizes market information
Directories and portals = general services that tie together a large variety of sites
Intelligent agents = software programs that use collaborative filtering to learn from
previous experiences in order to recommend new purchases.
The internet has enormous accounts of information, users want to narrow down their
choices.
Search engine simplification
=> The system companies use to make sure that their site will pop up if users search
terms via algorithms.
Online users’ ratings are the 2nd most used way of information search.
Reputation economy => People don’t post reviews for an income, but they serve as
brand advocates; create good recommendations.
Long tail strategy => companies don’t necessarily need to rely on big hits or
blockbusters to gain profits, they can make money by selling a few items to a small
group as well.
Perceived risk
=> The belief that the product has potentially negative consequences from using or not
using the product or service
Especially when it’s expensive, complex or unfamiliar.
Five types:
– Monetary risk (about money and property)
– Functional risk (about functions and fulfilment of needs)
– Physical risk (about vigor, health and vitality)
– Social risk (about self-esteem and confidence)
– Physiological risk (about affiliations and status)
If a product is visible to others, we experience more perceived risk. E.g., the risk of
embarrassment
3. Evaluation of alternatives
=> Making a choice between available alternatives
Identify alternatives
Consumers expect irrelevant information to undermine, rather than support related positive
information.
We do more extended processing in situations that arouse negative emotions due to
conflicts among alternatives
customer's choice
sets
evoked set =
alternatives the
consideration set consumer knows
about and would
buy
inept set = consumer inert set =
would not consider
these products due to
consumer has no
negative reviews or opinions on these
experiences products
, Producers want their products in the evoked set of their target market. Consumers are not
likely to relocate a rejected product to their evoked set. They’d rather search for a new
brand.
Product categorization
Based on appearance, price or previous connections
Hybrid products = products that feature characteristics of two distinct domains.
Products in the evoked set might share similar features, this could make or break products.
It depends on what other products you compare them with.
We tend to place products in an existing category, rather than creating a new one.
Knowledge structure: a set of beliefs and the way we organize these beliefs, marketers want
consumers to correctly group their products.
Levels of categorization
– Basic level
The item or group a person associates the product with (e.g. fattening desserts)
– Superordinate level
An abstract group (e.g. desserts)
– Subordinate level
Specific brands and groups (e.g. ice cream, Vianetta)
Strategic implications of categorization
Positioning a product -> hinges on the marketer’s ability to convince consumers to
categorize their products in a certain category.
Identify competitors -> products and services compete with each other at a broad
level for consumers’ discretionary cash
We often have to choose between not-comparable categories (apples and pears),
categories with an overlapping category make it easier to choose.
Create an exemplar product -> if a product is a really good example of a category, it
is more familiar and likely that we will buy it = category exemplars
Products that are not usual for a category may stimulate more information
processing, they are unfamiliar but not so different that we wouldn’t consider them
at all.
Locate products in a store -> if a product fits clearly in a category, it’s more likely that
consumers will find them
Evaluative criteria
=> The dimensions we use to judge the aspects of competing options.
Criteria on which products differ carry more weight than those where the
alternatives are similar. If all brands are considered equally well on one attribute,
consumers will have to find other reasons to choose.
Determinant attributes are the attributes we use to differentiate, e.g. the reputation
of a company for social responsibility or sustainability.
Trends in consumer behaviour
Trend = tendency in which certain products, subjects or ideas find increasing acceptance in a
growing section of the population. They indicate the preferences and values of consumers.
Causes of trends can mostly be found in societal and psychological social
developments.
There are four levels of trends:
1. Societal trends -> on a long term (10-30 years), in a macro context. Has an impact on
the entire society.
The DESTEP-model has interrelated domains in which societal trends can be found:
D emographic -> e.g. aging society, single parenting
E conomic -> e.g. inflation, spending, unemployment
S ocio-cultural -> e.g. social engagement, sharing lifestyle
T echnological -> e.g. information society, development of new jobs, VR
E cological -> e.g. climate change, sustainability
P olitical -> e.g. relationships & stability, elections, Brexit
Can lead to countertrends: regionalization vs globalization, socialization vs
individualization, humanizing vs de-humanization, etc.
2. Consumer trends -> tendency in the behaviour of consumers, which is unrelated to a
specific market domain and therefore more general. Consumer trends are strongly
related to psychological-social developments. They have a shorter term of impact (5-
10 years). E.g. healthy living, environmental consciousness, ethical behaviour (BLM).
3. Market trends -> trends in 1 specific market domain/industry e.g. food, tourism, etc.
In the food market: development of the vegan market. In tourism: sustainable
tourism, bleisure, personalization, solo-travel, etc.
4. Product trends -> a tendency in sudden preference for specific products. E.g. vegan
products, sustainable bikes, electronic cars, etc.
All the four trend domains are interrelated with each other, for example:
Healthy society (S) -> wanting to stay fit (C) -> active holidays (M) -> active products (P)
The relation between trends can be expressed in a trend pyramid. You start at the
top (P), and see what kind of market, consumer and societal trends are the base of
this product trend. But; you can start from the bottom (S) as well.
Chapter 8 Decision-making
Every consumer decision we make is a response to a problem.
Some decisions are more important than others, weigh pros and cons or let our
emotions decide.
,Purchase momentum => initial impulse purchases increase the likelihood that we will buy
even more.
Consumer hyperchoice = too many choices to choose from. This can lead to choosing an
avoidant option to avoid long decision processes.
Constructive processing = we evaluate the effort needed to make a decision.
Mental budget = calculating how much we consume over time.
Three categories of product choice:
– Cognitive
– Habitual
– Affective
With self-regulation, we specify how we want to react to certain situations and how much
weight we give to information.
This doesn’t always work, sometimes we give up on a strategy. Planning itself can
undermine our ability to attain goals, unsatisfying progress can lead to loss of self-
control.
Extended problem solving = cognitive decision making, finding as much information as
possible to avoid risks. Involves internal and external research.
Limited problem solving = straightforward and simple, we may use short-cuts to simplify.
Cognitive decision making
=> Rational, information-processing perspective. We integrate as much information as
possible and weigh pros and cons.
But: we just gather the information that we really need, and try to find the most
valuable information first so it’s not too time-consuming.
Five steps:
1. Problem recognition
=> When there's a significant difference between our current state (can move
downwards) and a desired/ideal state (can move upwards), which causes a
‘problem’.
Marketeers try to create primary demand, where consumers use a product or
service regardless of the brand they choose.
Secondary demand = when consumers do prefer a specific brand
2. Information search
Two types:
Internal search: based on prior experiences
External search: via ads, media, friends etc.
How much information do we search?
We tend to search more information when its’ an important
decision or when information is easy to find.
, Consumers who are moderately knowledgeable search the most, there’s an
inverted u-relationship between 1. The amount of search and 2. Product knowledge
Conclusion: 1
– Newbies with limited expertise may feel incompetent to search, they focus less on
the details and more on the big picture 2
– Experts tend to engage in selective search, thus more focused and efficient
Online search
Cybermediary = website or app that filters and organizes market information
Directories and portals = general services that tie together a large variety of sites
Intelligent agents = software programs that use collaborative filtering to learn from
previous experiences in order to recommend new purchases.
The internet has enormous accounts of information, users want to narrow down their
choices.
Search engine simplification
=> The system companies use to make sure that their site will pop up if users search
terms via algorithms.
Online users’ ratings are the 2nd most used way of information search.
Reputation economy => People don’t post reviews for an income, but they serve as
brand advocates; create good recommendations.
Long tail strategy => companies don’t necessarily need to rely on big hits or
blockbusters to gain profits, they can make money by selling a few items to a small
group as well.
Perceived risk
=> The belief that the product has potentially negative consequences from using or not
using the product or service
Especially when it’s expensive, complex or unfamiliar.
Five types:
– Monetary risk (about money and property)
– Functional risk (about functions and fulfilment of needs)
– Physical risk (about vigor, health and vitality)
– Social risk (about self-esteem and confidence)
– Physiological risk (about affiliations and status)
If a product is visible to others, we experience more perceived risk. E.g., the risk of
embarrassment
3. Evaluation of alternatives
=> Making a choice between available alternatives
Identify alternatives
Consumers expect irrelevant information to undermine, rather than support related positive
information.
We do more extended processing in situations that arouse negative emotions due to
conflicts among alternatives
customer's choice
sets
evoked set =
alternatives the
consideration set consumer knows
about and would
buy
inept set = consumer inert set =
would not consider
these products due to
consumer has no
negative reviews or opinions on these
experiences products
, Producers want their products in the evoked set of their target market. Consumers are not
likely to relocate a rejected product to their evoked set. They’d rather search for a new
brand.
Product categorization
Based on appearance, price or previous connections
Hybrid products = products that feature characteristics of two distinct domains.
Products in the evoked set might share similar features, this could make or break products.
It depends on what other products you compare them with.
We tend to place products in an existing category, rather than creating a new one.
Knowledge structure: a set of beliefs and the way we organize these beliefs, marketers want
consumers to correctly group their products.
Levels of categorization
– Basic level
The item or group a person associates the product with (e.g. fattening desserts)
– Superordinate level
An abstract group (e.g. desserts)
– Subordinate level
Specific brands and groups (e.g. ice cream, Vianetta)
Strategic implications of categorization
Positioning a product -> hinges on the marketer’s ability to convince consumers to
categorize their products in a certain category.
Identify competitors -> products and services compete with each other at a broad
level for consumers’ discretionary cash
We often have to choose between not-comparable categories (apples and pears),
categories with an overlapping category make it easier to choose.
Create an exemplar product -> if a product is a really good example of a category, it
is more familiar and likely that we will buy it = category exemplars
Products that are not usual for a category may stimulate more information
processing, they are unfamiliar but not so different that we wouldn’t consider them
at all.
Locate products in a store -> if a product fits clearly in a category, it’s more likely that
consumers will find them
Evaluative criteria
=> The dimensions we use to judge the aspects of competing options.
Criteria on which products differ carry more weight than those where the
alternatives are similar. If all brands are considered equally well on one attribute,
consumers will have to find other reasons to choose.
Determinant attributes are the attributes we use to differentiate, e.g. the reputation
of a company for social responsibility or sustainability.
