Preparation for the Consumer Behaviour exam at Edinburgh Business School. Content extracted from the ‘Consumer Behaviour’ text book by David A. Statt. All pictures used for educational purposes only. No copyright infringement intended.

1. Consumer Behaviour
Part I: The Consumer in Context
Preparation for the Consumer Behaviour exam at Edinburgh Business School
Content extracted from the ‘Consumer Behaviour’ text book by David A. Statt
All pictures used for educational purposes only. No copyright infringement intended.

2. PART I The Consumer in Context
Module 1:
People as Consumers
Module 2:
Market Segmentation
Module 3:
New Products and Innovations

3. ...and we are all consumers.

4. Module 1: People as Consumers
Studying people as consumers
Positivist approach
Focuses on predicting what the consumer will do under certain specified conditions.
Uses scientific research.
Reductionist approach
All human behavior can be reduced to consumerism.
Interpretivist approach
People are not always rational.
Reality is an individual’s subjective experience.
Cause and effect can’t be isolated.

5. Consumer Customer
Usually implies a
A person who purchases relationship over time
goods and services for between the buyer and a
personal use particular brand or retail
outlet.

6. Consumer Behaviour is...
...the emotional, mental and physical activities that people engage in when selecting,
purchasing using, and disposing of products and services so as to satisfy needs and desires.

7. Buying
is
not
just
a
necessary
activity
but
an
attractive
and
highly
approved
way
of
behaving.

8. At the heart of the trading nexus is the act of exchange between
producer and consumer for their mutual benefit.

9. “Consumption is the sole end
and purpose of all production.”
Adam Smith

10. The Production Orientation
“You can have any color you
want, as long as it's black.”
Henry Ford

11. The Marketing Concept
shift from selling
what you can make to
making what you
can sell!

12. ‘to create a customer’
A business has only
two important
functions, marketing
and innovation.
Peter Drucker

13. Module 2: Market Segmentation
cheapest brand, top-of-the-range
aimed at young intended as intermediate stages for the customer
first-time buyers on life’s automotive journey who has made it

14. 3 marketing conditions to be met for segmentation to work
identity
access
size

15. Most important forms of market segmentation:
geographic psychological benefit
demographic usage

16. geographic
Micromarketing
Same location ≈ same needs, wants, preferences
Cultural effects differ; Climatic conditions

17. geographic
Campbell’s soups
Micromarketing: America devided in 22 markets

18. geographic
Localization: Most consumer buying behaviour is local
Local newspaper, radio, TV, websites, in-store and POS-ads, etc.

19. demographic
statistically categorizing a population by
sex income
age education
occupation
social class
family size
religion

20. demographic
1. age

21. demographic
2. sex

22. demographic
3. socio-economic status (SES)
income
education
occupation

23. demographic
4. geodemographic

24. demographic
5. psychological aka lifestyle
activities
interests
opinions

25. demographic
American market divided into 10 segments with 5 female segments
Thelma Traditionalists 25%
Candice Chic suburbanite 20%
Mildred Militant mother 20%
Contented housewife 18%
Eleanor Elegant socialite 17%

26. demographic
6. segmentation by usage
The market is
usually divided
into USER
and NON-USER.

27. demographic
7. segmentation by benefits
Find out what
people want
and provide it
for them.

28. Module 3: New Products and Innovations
New products have to
be sold more and
more, therefore, to
existing customers.

29. Module 3: New Products and Innovations
Competitive advantage derives from
the encouragement of idea power.
- Rosabeth Moss Kanter

30. Module 3: New Products and Innovations
Innovation is not a luxury but a universal necessity.

31. Total Product Concept

32. The Product Life-Cycle

33. The Effects of Personal Influence
Personal characteristics of
PRODUCT CHAMPIONS
energy passion idealism
unwillingness to
pragmatism allow set back
cunning

34. The Effects of Personal Influence
There are opinion
leaders only if others
are willing to follow.

35. Diffusion of New Products & Innovations
definition:
the process by which an
innovation ... is communicated
through certain channels over
time among the members of a
social system.

36. Diffusion of New Products & Innovations
2012
Modifications to existing
1964
products, new models and
flavors.
continuous innovation

37. Diffusion of New Products & Innovations
Requires more change in
consumer behavior
dynamically continuous innovation

38. Diffusion of New Products & Innovations
Requires a new form of
consumer behavior
discontinuous innovation

39. Diffusion of New Products & Innovations
Three main types of innovation:
1. continuous 2. dynamically continuous 3. discontinuous

40. 5 product characteristics that determine consumer response:
compatibility
Complexity Trialability
Observability

41. Relative Advantage
improvement over existing
products?

42. Compatibility
deals with the issue of
how well the innovation
fits with the potential
consumer’s existing values,
attitudes, interests and
behaviour

43. Complexity
The easier
it looks to
use the
more likely
will people
be to try
it.

44. Trialability
simple
difficult

45. Observability
how easily
the benefits
of the
innovation
can be
conveyed

46. Adoption of New Products and Innovations

47. PART II The Individual Perspective
Next Modules:
4) Perception 5) Personality 6) Learning, Memory & Thinking 7) Motivation