Consumer Behaviour Unit 3 Socio-cultural Factors of Consumer Behaviour

By Parimol / Consumer Behaviour

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Consumer Behaviour Unit 3 Socio-cultural Factors of Consumer Behaviour

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Socio-cultural Factors of Consumer Behaviour

CONSUMER BEHAVIOUR

VERY SHORT TYPES QUESTION & ANSWERS

1. Which of the following would be the best illustration of a subculture?

(a) A religion.

(b) A group of close friends.

(d) A fraternity or sorority.

Ans: (a) A religion.

2. The relatively homogeneous and enduring divisions in a society, which are hierarchically ordered and whose members share similar values, interests, and behaviour constitute ___________.

(a) a culture.

(b) a subculture.

(d) a family.

Ans: (a) a culture

3. A person ‘s ___________ consist (s) of all the groups that have a direct (face-to-face) or indirect influence on his/her attitudes or behaviour.

(a) Subculture.

(b) Family.

(d) Reference groups.

Ans: (d) reference groups.

4. Social classes differ in media preferences, with upper-class Consumers often preferring ___________ and lower-class consumers often preferring television.

(a) Movies.

(b) Radio.

(d) Magazines and books.

Ans: (d) magazines and books.

5. The family in a buyers life consisting of parents and siblings is the ___________.

(a) Family of procreation.

(b) Family of influence.

(d) Family of orientation.

Ans: (d) family of orientation.

6. Purchasing family when Gary was a high school student, he enjoyed rock music and regularly purchased hip clothing sported by his favourite rock band. However, five years later, when Gary became an accountant, his preference shifted toward formal clothing. Which of the following personal characteristics is likely to have had the most influence on Gary’s preferences during his high school days?

(a) Education.

(b) age.

(d) Gender.

Ans: (b) age.

7. Marriage, childbirth, and divorce constitute the ___________ that shape the consumption pattern of individuals.

(a) Psychological life cycle.

(b) Product life cycle.

(d) Critical life events.

Ans: (d) critical life events.

8. Identify an economic circumstance that can greatly affect any product or brand choice.

(a) Retirement.

(b) Values.

(d) Borrowing power.

Ans: (b) borrowing power.

9. ___________ refers to a set of distinguishing human psychological traits that lead to relatively consistent and enduring responses to environmental stimuli.

(a) Image.

(b) Personality.

(d) Prohibitive.

Ans: (b) personality.

10. Consumers often choose and use brands that have a brand personality consistent with how they see themselves, also known as the ___________.

(a) actual self-concept.

(b) ideal self-concept.

(d) Prohibitive self-contact.

Ans: (a) actual self-concept.

11. ___________ portrays the “whole person” interacting with his or her environment.

(a) Attitude.

(b) Personality.

(d) Self-concept.

Ans: (c) Lifestyle.

12. Marketers who target consumers on the basis of their ___________ believe that they can influence purchase behaviour by appealing to people’s inner selves.

(a) Core values.

(b) Sophistication.

(d) Social class.

Ans: (a) core values.

13. At the top of Maslow ‘s hierarchy of needs (shown as a pyramid in the text) are ___________ needs.

(a) esteem.

(b) Self-actualisation.

(d) Safety.

Ans: (b) self-actualisation.

14. As Rita scans the yellow pages section of her phone book looking for a florist, she sees several other products and services advertised. Though interesting on first glance, she quickly returns to her primary task of finding a florist. The items that distracted her from her initial search were most likely stored in which of the following types of memory?

(a) Short-term memory.

(b) Long-term memory.

(d) Subconscious memory

Ans: (a) Short-term memory

15. ___________ is one of the most basic influences on an individual’s needs, wants, and behaviour.

(a) Brand.

(b) Culture.

(d) Price.

Ans: (b) Culture.

16. Which of the following also includes a situation-specific component?

(a) Personality.

(b) Self-concept.

(d) Demographics.

Ans: (c) involvement.

17. Which of the following is a situation in which consumer behaviour occurs?

(a) Communications situation.

(b) Purchase situation.

(d) All of the above.

Ans: (d) All of the above.

18. Which of the following is NOT a situation in which consumer behaviour occurs?

(a) Communications situation.

(b) Purchase situation.

(d) all of the above are situations in which consumer behaviour occurs.

Ans: (d) all of the above are situations in which consumer behaviour occurs.

19. The headline for the Rockport shoes ad reads, “I’m comfortable being the greatest that ever was or will be. Be comfortable. Uncompromised. Start with your feet.” The ad shows a picture of Muhammad Ali, world famous boxer. In terms of Maslow’s hierarchy, this ad was designed to appeal to the consumer’s ___________.

(a) Psychological needs.

(b) Need for esteem.

(d) Self-actualisation needs.

Ans: (c) Safety needs.

20. Understanding of consumer needs and then develops a marketing mix to satisfy these needs.

(a) The marketing concept.

(b) The strategic plan.

(d) The price influences.

Ans: (a) The marketing concept.

SHORT TYPE QUESTIONS & ANSWERS

1. What do you mean by family?

Ans: A group of two or more people related by blood, marriage, or adoption, living together in a household.

2. What do you mean by family life cycle?

Ans: The series of life stages that a family goes through starting with young single people, progressing through married stages with young and then older children, and ending with older married and single people. At each stage needs, income and family composition change.

3. What is called a Reference Group?

Ans: Those persons from whom an individual derives his values, standards, tastes, etc. and on whom the individual moulds his attitudes and behaviour, i.e., a group that forms a basic of comparison for the individual.

4. What do you mean by consumer conformity?

Ans: The willingness of consumers to adopt the norms, attitudes, and behaviour of reference groups.

5. What is meant by ‘social class’?

Ans: social class is defined as the division of members of a society into a hierarchy of distinct status classes, so that members of each class have relatively the same status and members of all other classes have either more or less status.

6. What is social comparison theory?

Ans: Individuals quite normally compare their own material possessions with those owned by others in order to determine their relative social standing.

7. What do you mean by culture?

Ans: A way of living that distinguishes one group of people from another. Culture is learned and transmitted from one generation to another.

8. What is Enculturation?

Ans: The learning of the culture of one ‘s own society.

9. What is Acculturation?

Ans: The learning of a new or “foreign”culture.

10. What do you mean by consumer socialisation?

Ans: The process, started in childhood, by which an individual first learns the skills and attitudes relevant to consumer purchase behaviour.

11. What do you mean by subculture?

Ans: A clearly distinguishable subgroup existing within a larger surrounding culture. Subcultures May be based on such factors as age or race or upon a form of distinctive behaviour. In a marketing context subcultures May be used as a basis for marketing segmentation.

12. What is cross cultural consumer analysis?

Ans: Research to determine the extent to which consumers of two or more nations are similar in relation to specific consumption behaviour.

13. Explain consumer Ethnocentrism.

Ans: A consumer’ predisposition to accept or reject foreign – made products. A person with high Ethnocentrism means he will reject the foreign made products and if a person with low Ethnocentrism means he will accept the foreign made products.

14. What is Consumer retention?

Ans: providing value to customers continuously so they will stay with the company rather than switch to another firm.

15. What is customer satisfaction?

Ans: An individual’s perception of the performance of the product or service in relation to his or her expectations is known as customer satisfaction.

LONG TYPE QUESTIONS & ANSWERS

1. What is cross cultural consumer analysis? What are the various cultural factors of consumer behaviour?

Ans: Research to determine the extent to which consumers of two or more nations are similar in relation to specific consumption behaviour.

(A) cultural Factors: cultural Factors have the broadest and deepest impact on consumer behaviour. This set of factors mainly includes broad culture, subculture, and culture of social classes.

(i) Broad culture: culture is a powerful and dominant determinant of personal needs and wants. Culture can be broadly defined as: the way of living, way of doing, and way of worshiping. Culture determines the total patter of life. Culture has a tremendous effect on needs and preference. People react according to the culture to which they belong. Every culture has its values, customs, traditions, and beliefs, which determine needs, preference, and overall behaviour. The child acquires a set of values, perception, attitudes, interest, preference, and behaviour from family and other key social institutions that control his/her behaviour. Every member is bound to follow cultural values to which he belongs. These cultural factors determine the way of reacting toward product and marketing strategies.

Culture is reflected in terms of followings:

(a) Family life/social system.

(b) Role of women.

(d) Approach to work and leisure.

(e) Approach to life.

(f) Ethnics in economic dealings.

(g) Residence pattern.

(h) Geographic factors.

(i) Impact of other cultures, and so on.

(ii) subcultures: Each culture consists of smaller subcultures. Each subculture provides more specific identification of members belong to it. Product and marketing programme should be prepared in light of subcultures to tailor their needs.

Subculture includes:

(a) Nationality: Every nation has its own unique culture that shapes and controls behaviour its citizens. For example, Indian culture, American culture, Japanese culture, Chinese culture, African culture, etc. Consumers of different nations hold different behaviour toward the company’s products and strategies. The company can concentrate on one or more nations to serve.

(b) Religion: It is a powerful determinant of consumer needs and wants. Every religion has its culture in terms of rules, values, Rituals, and procedures that have impact on its followers. Commonly, consumer behaviour is directly affected by religion in terms of products that are symbolically and ritualistically associated with the celebration of various religious events and festivals / holidays.

Religious requirements or practices, sometimes, take on an expanded meaning beyond their original purpose. For example, Christians, Hindus, muslims, Buddhists, etc., influence food preference, clothing choice, career aspirations, and overall pattern of life.

Even,in each religion, there are several sub-religions. For example, Hindu Religion includes vaishnav, Swaminarayan, shivpanthi, Swadhiyai, and likewise: Christian Religion includes protestants and Catholics; and similar is the case with Muslim and Jain.

(c) Racial Groups: In each Culture,we find various racial groups; each of them tends to be different in terms of needs, roles, professions, habits, preference, and use of products . Each group responds differently to marketing offers due to different cultural backgrounds.

For example, in our country, we find a number of racial groups like kshatriya, Banya, Patel, Brahmin, scheduled caste, scheduled tribe, shepherded, and so forth. These racial groups have their cultural values, norms, standard, habits, etc., that govern their overall response toward the company’s products.

(d) geographical regions: Each geographic region represents specific culture and differs in terms of needs, preference, habits, usage rates, and use of products. Clothing, residence, food, vehicle, etc., are determined by regional climate and culture.

(iii) culture of social classes: Philip kotler defines: “social classes are relatively homogeneous and enduring divisions in a society, which are hierarchically ordered and whose members share similar values, Interest, and behaviour.” In many cases, social classes are based on caste system. Members of different castes have their cultures and, accordingly, they perform certain roles.

Social classes reflect differences in income, occupation, education, their roles in society, and so on. Every social class has its culture that affects behaviour of its members. Social classes differ in their dress, speech patterns, recreational preferences, social status, value orientation, etc.

They show distinct product and brand preferences in many areas like clothing, home furniture, education, leisure activities, and automobiles. kotler identifies following social classes, each of them differs significantly in term of income, skills, needs, habits, preference, career orientation, approach toward life, etc.

2. What do you mean by social factor? What are the various social factors of consumer behaviour?

Ans: The second major group of factors that influence consumer decision making are social factors, which include all effects on the buying behaviour that result from interactions between a consumer and the external environment. Social factors have a direct impact on the consumption and purchasing behaviour of people. Consumer behaviour is an action that affects not only individuals and societies, but also countries and national economies.

Here, we examine the effect of social factors on consumer needs and preferences (behaviour). Social factors affect consumer behaviour. Consumer response to product, brand, and company is notably influenced by a number of social factors – family, reference groups and roles and statuses. Marketer needs to analyse these social factors of his Target market to cater its needs effectively.

Let’s briefly comment on some dominant social factors influencing consumer behaviour:

(a) family: family is one of the most powerful social factors affecting Consumer behaviour. This is more significant where there is joint family system, in which children use to live with family for longer time. Values, traditions, and preferences are transmitted from parents to children inherently.

Family members constitute the most influential primary reference group. From family, its member acquires an orientation toward religion, politics, ambition, self-worth, love, respect, and so on. Need, preference, buying habits, consumption rate, and many other aspects determined by family affect one’s behaviour.

In every family, elders, husband-wife, other members, and children have varying degree of influence on purchase decision, which is the matter of interest for the marker to appeal them. Some products are children dominant; some products are husband dominant; some products are wife dominant; while some products are equal dominant.

(b) Reference Groups: Philip Kotler states: “A person’s reference group consists of all the groups that have a direct (face-to-face) or indirect influence on the person’s attitudes or behaviour.” Groups having a direct influence on the person are called membership groups.

Normally, following reference Groups affect behaviour of their members:

(i) Primary Reference Groups: They are informal groups such as family members, friends, neighbours, relatives, and co-workers with whom the person interact family continuously. Habits, life-style and opinions of these groups have direct impact on the person.

(ii) Secondary Reference Groups: They tend to be more formal groups such as religious groups, professional groups, trade unions or associations, etc., that affect buying decisions of an individual buyer.

(iii) Aspiration (Aspired) Groups: A person is not the member of such groups. But, he likes to belong to those groups. He imitates habits, preference and buying pattern of such groups. For example, college students imitate / like to belong to film stars, sportsmen, or professional groups.

(iv) Dissociative (Disliked) Groups: Theses reference groups include such groups whose values or behaviour a person rejects or dislikes. He tends to behave differently than those groups. A marketer should identify reference groups of his Target market and should try to influence those groups. In case of television, automobile, clothing, home furniture, books and magazines, cigarettes, etc., The reference groups have more direct impact on buyers’ purchase decision.

(c) Roles and statuses: A person plays various roles in many groups throughout his life. He has to play different roles in family, club, office, or social organisation. A role consists of the activities that a person is expected to perform. For example, a person is father for his children, husband for his wife, son for his parents, friend for his friends, boss for his department, and a member of social organisation.

Each role carries status. For example, sales manager has more status than sales officer. People choose those products that communicate or represent their roles and statuses in society. Therefore, marketer must be aware of the status symbol potential of products and brands. The marketer should also try to associate products and brands with specific roles and status.

(d) social customs and traditions: social customs, beliefs or traditions can be associated with religion, caste, or economic aspects. Such customs determine needs and preference of products in different occasions and hence, affect consumer behaviour.

(e) Income level: Income affects needs and wants of consumers. Preference of the rich consumers and the poor consumers differ notably. In case of quality, brand image, Novelty, and costs, there is wide difference between the rich and the poor buyers. Marketer must be aware of expectations of different income groups of his Target market.

3. Explain Consumer black box model. Also explain the factors affecting consumer black Box.

Ans: The black box model shows the interaction of stimuli, consumer characteristics, and decision process and consumer responses.

The essence of the model is that it suggests consumers will respond in particular ways to different stimuli after they have ‘processed’ those stimuli in their minds. In more detail, the model suggests that factors external to the consumer will act as a stimulus for behaviour, but that the consumer’s personal characteristics and decision-making process will interact with the stimulus before a particular behavioural response is generated. It is called the ‘black box’ model because we still know so little about how the human mind works. We cannot see what goes on in the mind and we don’t really know much about what goes on in there, so it’s like a black box.As far as consumer behaviour goes, we know enough to be able to identify major internal influences and the major steps in the decision-making process which consumers use, but we don’t really know how consumers transform all these data, together with the stimuli, to generate particular responses.

Factors Affecting Consumer Behaviour:

(a) Cultural Actors: Consumer behaviour is deeply influenced by cultural factors such as – buyer culture, subculture, and social class.

Culture: Basically, culture is the part of every society and is the important cause of person wants and behaviour. The influence of culture on buying behaviour varies from country to country therefore marketers have to be very careful in analysing the culture of different groups, regions or even countries.

Subculture: Each culture contains different subcultures such as religious, nationalities, geographic regions, racial groups etc. marketers can use these groups by segmenting the market into various small portions. For example marketers can design products according to the needs of a particular geographic group.

Social class: Every society possesses some from of social class which is important to the Marketers because the buying behaviour of people in a given social class is similar. In this way marketing activities could be tailored according to different social classes. Here we should note that social class is not only determined by income but there are various other factors as well such as: wealth, education, occupation etc.

(b) social factors: social factors also impact the buying behaviour of consumers. The important social factors are: reference groups, family, role and status.

Reference groups: Reference Groups have potential in forming a person attitude or behaviour. The impact of reference groups varies across products and brands. For example if the product is visible such as dress, shoes, car etc then the influence of reference groups will be high. Reference groups also include opinion leader (a person who influences other because of his special skill, knowledge or other characteristics).

Family: buyer behaviour is strongly influenced by the member of a family. Therefore marketers are trying to find the role and influence of the husband, wife and children. If the buying decision of a particular product is influenced by wife than the Marketers will try to target the women in their advertisement. Here we should note that buying roles change with change in consumer lifestyles.

Roles and status: Each person possesses different roles and status in the society depending upon the groups, clubs, family, organisation etc. to which he belongs. For example a woman is working in an organisation as finance manager. Now she is playing two roles, one of finance manager and other of mother. Therefore har buying decisions will be influenced by her role and status.

(c) Personal Factors: Personal Factors can also affect the consumer behaviour. Some of the important personal factors that influence the buying behaviour are: lifestyle, economic situation, occupation, age, personality and self concept.

Age: age and life-cycle have potential impact on the consumer buying behaviour. It is obvious that the consumers change the purchase of goods and services with the passage of time. Family life-cycle consists of different stages such young singles, married couples, unmarried couples etc which helps Marketers to develop appropriate products for each stage.

Occupation: The occupation of a person has significant impact on his buying behaviour. For example a marketing manager of an organisation will try to purchase business suits, whereas a low level worker in the same organisation will purchase rugged work clothes.

Economic situation: Consumer economic situation has great influence on his buying behaviour. If the income and savings of a customer is high than he will purchase more expensive products. On the other hand, a person with low income and savings will purchase inexpensive products.

Lifestyle: lifestyle of customers is another important factor affecting the consumer buying behaviour. Lifestyle refers to the way a person lives in a society and is expressed by the things in his/her surroundings. It is determined by customer interests, opinions, activities etc and shapes his whole pattern of acting and interacting in the world.

Personality: Personality changes from person to person, time to time and place to place. Therefore it can greatly influence the buying behaviour of consumers. Actually, personality is not what one wears: rather it is the totality of behaviour of a man in different circumstances. It has different characteristics such as: dominance, aggressiveness, self-confidence etc which can be useful to determine the consumer behaviour for particular product or service.

(d) Psychological Factors: There are four important psychological factors affecting the consumer buying behaviour. These are: perception, motivation, learning, beliefs and attitudes.

Motivation: The level of motivation also affects the buying behaviour of consumers. Every person has different needs such as physiological needs, biological needs, social needs etc. The nature of the needs is that, some of them are most pressing while others are least pressing. Therefore a need becomes a motive when it is more pressing to direct the person to seek satisfaction.

Perception: Selecting, organising and interpreting information in a way to produce a meaningful experience of the world is called perception.There are three different perceptual processes which are selective attention, selective distortion and selective retention. In case of selective attention, marketers try to attract the customer attention. Whereas, in case of selective distortion, customers try to interpret the information in a way that will support what the customers already believe. Similarly, in case of selective retention, marketers try to retain information that supports their beliefs.

Beliefs and Attitudes: Customer possesses specific belief and attitude towards various products. Since such beliefs and attitudes make up brand image and affect consumer buying behaviour therefore marketers are interested in them. Marketers can change the beliefs and attitudes of customers by launching special campaigns in this regard.

4. Explain Social class and its impact on consumer behaviour.

Ans: Consumer behaviour is determined by the social class to which they belong. The classification of socioeconomic groups is known as Socio-Economic Classification (SEC). Social class is relatively a permanent and ordered division in a society whose members share similar value, interest and behaviour. Social class is not determined by a single factor, such as income but it is measured as a combination of various factors, such as income, occupation, education, authority, power, property, ownership, life styles, consumption, pattern etc.

Factors showing social class differences:

(i) Lower level: Lower level occupation with no authority, less income, and no education or minimum education. For example, labour class or clerks etc.

(ii) Middle class: Graduates, or postgraduates executives’ managers of companies with authority, drawing handsome salaries of which a certain amount can be saved and invested. For example, executives or middle level managers of companies.

(iii) Higher class: Authoritative person, drawing handsome salary, very often professionally qualified, working in a very senior position or a person born into a rich family, with a good background of education.

Social class as the division of members of a society into a hierarchy of distinct status classes, so that members of each class have relatively the same status and the members of all other classes have either more or less status.We should consider another factor of social mobility where a person gets up in the social ladder (for example, poor can become middle class and middle class become rich or the children of uneducated family can attain higher education) or down in the social ladder (for example, rich can become poor or the children of a highly educated family may not continue study). Therefore marketing managers are required to study carefully the relationship between social classes and their consumption pattern and take appropriate measures to appeal to the people of those social classes for whom their products are meant. Higher positions imply higher status. We can say that Social class is more of a continuum, i.e., a range of social positions, on which each member of society can be place. But, marketing managers have divided this continuum into a small number of specific classes.

5. What are Cultural Influences on Consumers? Explain the impact of reference groups on consumer behaviour.

Ans: Culture is the most fundamental determinant of a person’s want and behaviour. The growing child acquires a set of values, perception preferences and behaviours through his or her family and other key institutions. Culture influences the pattern of consumption and the pattern of decision-making. Marketers have to explore the cultural forces and have to frame marketing strategies for each category of culture separately to push up the sales of their products or services.It influences consumer behaviour to a great extent. Cultural values and elements are passed from one generation to another through family, educational institutions, religious bodies, social environment, etc. Cultural diversity influences food habits, clothing, customs and traditions, etc.

In our daily lives, we all get influenced by a variety of people while making our purchase decisions. We, as humans, do a lot to try to impress others. We make purchases to get compliments and try so that others should not think less of us.

A reference group is the group whose perspective we consider. Now our reference could be very large or very small including few of our family members or few close friends. Reference groups influence people a lot in their buying decisions. They set the levels of lifestyle, purchasing patterns, etc.

Reference groups are of two types:

(a) Primary Groups.

(b) Secondary Groups.

(a) Primary groups: primary reference groups are basically the set of people whom you meet every day. They can be from your family, your close friends, your roommates, etc.

These people from primary groups may have a direct and strong impact in your lives and your buying decisions since they are very significant to you. Primary Groups make you comfortable and give you a feeling that they are with you when you are confused about a purchase. These people give you very honest and clear advices as they are so close to you, due to which you could be more confident about the purchase. Research shows that the bond between people leads people to be effectively social and as satisfied consumers.

Secondary Groups: Secondary Reference groups are usually formal and they speak less frequently. They might be professionals, your colleagues, your seniors at work or your acquaintance at club, etc.

In secondary reference groups the power to influence people is quite less as compared to primary reference groups as people in these groups are not that comfortable in sharing their thoughts or views on the purchase.

Let’s have a look at few more reference groups

Aspiration Group: Aspiration group is the one to which a person may want to become part of. They currently are not part of that group but wish to become and get with that group. For doing the same, they try to dress, talk, act and even think the way the members of that group do.

Dissociative Group: The people in these groups are totally opposite to the people in the aspirational group. Here people deny of becoming or getting connected to a particular group. They just hate being related to that group.

For example, if people don’t like a particular community, they would never like being connected to them. So they would try all the possible ways to avoid the way in which they dress, think or act.

Thus marketers need to understand the likes and dislikes of the consumers and also the groups to which they belong. Marketers should recognize the extent to which a reference group influences the consumer and he should also understand out of all the groups which group influences him the most.

Family: family of a consumer plays an important role in the decision making process. The parents, siblings, relatives all have their own views about a particular purchase.

Following are the roles in the family decision making process:

(a) Influencers: Influencers are the ones who give ideas or information about the product or service to the consumer.

(b) Gate keepers: gatekeepers are the family members who usually panel the information. They can be our parents or siblings too who can in any form provide us the information about the product.

(c) Decision making: family or our parents who usually have the power to take decisions on our behalf are the decision makers. After the complete the research they may decide to purchase the particular or dispose it.

(d) Buyers: buyer is the one who actually makes the purchase of the product.

(e) End Users: The person who finally uses the product or consumes the service is the ultimate consumer also called as End user as per the context.

A consumer gets influenced by his family members as well as friends. since childhood the culture which he follows or the rituals which he observes and the moral values and the religious principles he usually receives them from his family. However, the individual learns fashion, attitude or style from his friends. All These attributes or traits together influence the buyer ‘s decision making.

6. What is the Black Box Model of consumer behaviour?

Ans: The model (or framework) of consumer behaviour was first devised by professor Geoffrey Jones and his colleague at the centre for marketing studies, Cambridge University. It has been elaborated on further by Australian academics such as Rodney hitchin. They suggested that often consumers are not sure about what influences their buying decision process. The answers to those questions are often Buried within the customer’s mind. The model consists of three major components namely: Environment, buyer’s black box, and Buyer’s responses.

Three major components of the black box model:

(a) Environment: According to this model, the environment consists of stimuli given by the firm as well as external stimuli. This marketing stimuli given by the firm will be in the form of the marketing mix. For example, the firm might be sending advertising messages for products. The external stimuli refer to the marketing environment which indirectly influences the customers. It is important to note that we differentiate between “environment’’ and ‘people’ here as people influence the choices but people cannot create decision situations.

(b) Buyer’s black box: As mentioned, the buying decision is made by a person that does not fully understand all Factors influencing him or her. This refers to the customer interacting between past experience, beliefs, desires, and objectives when making a buying decision. The buyer’s “black box” consists of his/her personal preferences and attitudes towards the product-market fit as well as the value creation process itself.

(c) Buyer’s Characteristics: The buyer’s characteristics work closely with the buyer’s black box. A buyer’s character depends on many factors such as information and motivation. It is believed that buying characters are relatively stable over time while people can change attitudes of their personal preference during a lifetime for an item which has influenced them in the early years. The buying characters are determined by other people’s information, purchase behaviour, and brand attitudes.

(d) Buyer’s Decision Process: The buyer’s decision process is the sequence of steps that the buyer will follow when making a buying decision. It can be broken down into five phases: Concept selection, Search, Evaluation, and Selection (SEES), Evaluative experience, Calculating purchase motives, and Adaptation to new feelings for this item over time. The mentality, needs, and expectations of the buyers are important to take into account when making a purchase but hard data may not always show influence on Pricing decisions since there can be no Direct association between quality perceptions and these actual buying motives.

(e) Buyer’s responses: After purchase, the product performance can also affect the reaction of buyers. If a person who is angry or upset with an experience suffers from buyer’s remorse, s/he may be inclined to purchase to revise the past event in order for this negative feeling to be removed although it seldom happens because many people are purchasing a product without first having any thoughts to it.

When the sales of a particular brand decrease rapidly, this implies that customers are dissatisfied with their experiences from those experienced brands which create an insufficient demand for those products as well as declines its value itself which also causes other people not to buy that brand. If the customers are loyal enough to return to “solve” their problem, this can positively impact the sales… oftentimes more than no longer offering those products will negatively contribute due to overall damage caused by not gaining any client or losing the client.

(f) conclusion: the black box model of consumer behaviour is a good way to understand how the consumer’s decision-making process works. While it is difficult to see exactly why someone would make a particular purchase, it is possible to deduce some patterns that are relevant in understanding the Buyer’s thinking. When designing products or services, you can use this knowledge to make sure your product or service meets the needs of the customer and drives their behaviour towards making more purchases from you.

The black box model also suggests that consumers will continue to purchase products They do not need just because they have been habituated into doing so by previous purchases. Therefore, you should not be surprised if your customers continue to buy the same products over and over again. This model does not take into account the situation in which the customer has already made a purchase; it only looks at how people make new purchases. Read our other blogs on consumer behaviour models to gain a comprehensive understanding of consumer behaviour.

7. Discuss the Dynamics of Opinion Leadership.

Ans: Opinion Leadership is the process by which one person (opinion leader) informally influences the actions or attitudes of others, who may be opinion seekers or merely opinion recipients. The definition of opinion leadership emphasises on informal influence.

Dynamics of Opinion Leadership:

(i) Credibility: Opinion seekers regard opinion leaders as trustworthy and a credible source of information pertaining to a particular product or brand – the opinion leaders have no hidden commercial motives, like cash rewards, in promoting a brand. Also opinion seekers seek their help in decision making because they have expertise or usage experience with a product or brand, which considerably reduces the perceived risk of the opinion seeker. The information given by the opinion leader can be either positive or negative, based on personal experience, and this further strengthens their credibility.

(ii) Information and Advice: Opinion leaders are a source for product or brand specific information as well as advice. They might just share casual information about a certain product that they have used, they might even aggressively advice opinion seekers whether to buy it or not. The information passed can be related to which product or brand to purchase and from where.

(iii) Category-specific: Opinion leaders can have expertise in one product category, but can reverse the role to opinion seekers in case of another product category in which they are not knowledgeable. A person known for his/her cooking talent may be an expert in the ‘what’ and ‘how’ of packed edible food products, spices, food nutrition, etc, but when he or she has to buy a bike, is more likely to seek information from another person whom he/she regards as knowledgeable about bikes. Therefore, an opinion leader in one product may be an opinion seeker in another product.

(iv) Two-way communication: Opinion leadership phenomena are face-to-face communication between opinion givers and opinion seekers. Both parties communicate their respective experiences with each other. Some scholars, thus, believe that the difference between opinion giver and opinion seekers is somewhat artificial as the person who is knowledgeable about a certain product and gives related advice to opinion seekers, is also most likely to listen to others’ comments regarding the product.

(v) Specific Characteristics: Opinion leaders possess distinct personality traits. These include self confidence and gregariousness. They are socially inclined, outspoken and are knowledgeable.

8. Explain the Criticisms of Black Box Model.

Ans: The Black Box Model has come under criticism several times due to doubts about its practical usage.

(i) Inconsistency: One of the biggest drawbacks stated by the experts is the inconsistency of the Black Box Model. Relying too heavily on such models does not always reap benefits in the marketing industry.

(ii) Does not Apply to All Products: The black box model does not apply to all the products in the same way. making it difficult for marketers to rely on the basic strategy of the model. They have to perform more research on their field of product that will eventually lead to more time consumption. Constantly varying interests of the consumers make it difficult for the companies to stick to one plan of action.

Also, there are millions of customers globally with highly different interests. The market analysis doesn’t need to always be correct using the Black Box Model.

(iii) Social Factors: As discussed above, social factors can be a huge advantage for companies to increase their product value. But, in some cases, it may serve as a disadvantage too. For example, it is commonly predictable for the companies to sell barbecues on the Fourth of July in America. But, Knowing how the family, friends, and social groups influence a customer is a more complex process.

(iv) Inefficient Marketing Strategies: Sometimes, in the end, marketing strategies end up becoming all about satisfying the wants of people rather than actually fulfilling their needs. They also try to take advantage of the weaknesses of the consumers in the form of exchange, lotteries, and gifts. High claims of such companies usually turn out to be false advertisements and loss of money for the consumers.

9. Write about the Applications of Black Box Model.

Ans: Over the years, the black box has usually been used to create strategies and execution plans for the successful sale of a product.

(i) Financial markets, Websites, and product-selling companies use the black box model to design convincing and in-demand products to influence and attract consumers worldwide.

(ii) Most of the product-creating companies in the market work with the principle of want-fulfilment, not need-fulfilment.

(iii) Depending on the various factors, they create popularity and desires for their product with the help of celebrity faces.

(iv) These companies also come with different strategies like longer periods of discounts to keep the consumers attracted to their products.

(v) Through these desires and will-developed plans, they get to create a global demand for their services.

For example, a product costing INR 5000 is usually sold at INR 4500 with taxes. It comes around the festive seasons to draw consumers to their retail outlets.

(vi) Adjusting the price, place, and promotion of products according to the consumers is yet another application of the Black Box Model.

(vii) It helps to analyse the existing market opportunities and create a demand accordingly.

(viii) It also helps to target a specific group of people to engage them in the company’s products according to their needs.

10. What is Buyer’s black box and its components?

Ans: As mentioned, the buying decision is made by a person that does not fully understand all Factors influencing him or her. This refers to the customer interacting between past experience, beliefs, desires, and objectives when making a buying decision. The buyer’s “black box” consists of his/her personal preferences and attitudes towards the product-market fit as well as the value creation process itself.

(i) Buyer’s Characteristics: The buyer’s characteristics work closely with the buyer’s black box. A buyer’s character depends on many factors such as information and motivation. It is believed that buying characters are relatively stable over time while people can change attitudes of their personal preference during a lifetime for an item which has influenced them in the early years. The buying characters are determined by other people’s information, purchase behaviour, and brand attitudes.

(ii) Buyer’s Decision Process: The buyer’s decision process is the sequence of steps that the buyer will follow when making a buying decision. It can be broken down into five phases: Concept selection, Search, Evaluation, and Selection (SEES), Evaluative experience, Calculating purchase motives, and Adaptation to new feelings for this item over time. The mentality, needs, and expectations of the buyers are important to take into account when making a purchase but hard data may not always show influence on Pricing decisions since there can be no direct association between quality perceptions and these actual buying motives.

11. What do you understand about Social class? Explain its nature? Discuss the uses of social class as a market segmentation process?

Ans: Consumer behaviour is determined by the social class to which they belong. The classification of socioeconomic groups is known as Socio-Economic Classification (SEC). Social class is relatively a permanent and ordered division in a society whose members share similar values, interest and behaviour. Social class is not determined by a single factor, such as income but it is measured as a combination of various factors, such as income, occupation, education, authority, power, property, ownership, life styles, consumption, pattern etc.

Here’s a breakdown of how social class affects consumer behaviour:

(i) Income and Spending Patterns: People from different social classes have different purchasing power and spending habits. Higher social classes tend to have more disposable income, enabling them to make luxury purchases and engage in conspicuous consumption.

(ii) Product Preferences: Social class profoundly influences brand preferences. Different social classes tend to favour specific brands that align with their perceived status and values. Higher social classes may gravitate toward luxury and premium brands, while lower classes may opt for more budget-friendly options.

(iii) Brand Loyalty: Consumers from higher social classes may exhibit stronger brand loyalty, as they associate certain brands with their social identity and status. In contrast, individuals from lower social classes may be more open to switching brands based on price and value propositions.

(iv) Shopping Behaviour: Individuals from different social classes have distinct tastes, preferences, and buying behaviours. For example, consumers belonging to the upper class may seek luxury products that showcase their status, while those from the working class may prioritise affordability and functionality.

(v) Social Influence: Social influence comprises the ways in which individuals adjust their behaviour to meet the demands of a social environment. It takes many forms and can be seen in conformity, socialisation, peer pressure, obedience, leadership, persuasion, sales, and marketing.

Social class influences the lifestyle, taste, and spending habits of consumers. To segment your market based on social class, you need to identify the different levels of social class in your target market and how they differ in their product choices, brand preferences, and media consumption.Therefore marketing managers are required to study carefully the relationship between social classes and their consumption pattern and take appropriate measures to appeal to the people of those social classes for whom their products are meant. Higher positions imply higher status. We can say that Social class is more of a continuum, i.e., a range of social positions, on which each member of society can be placed. But, marketing managers have divided this continuum into a small number of specific classes. Thus, we go by this framework, social class is used to assign individuals or families to a social-class category. We can now define social class as the division of members of a society into a hierarchy of distinct status classes, so that members of each class have relatively the same status and the members of all other classes have either more or less status.

12. Define sub – culture and explain its division on a different basis. Explain how culture and sub – culture influence the behaviour of consumers.

Ans: Each culture consists of smaller sub-cultures that provide specific identity to its members. Subcultures include sub-caste, religious sects (Roman Catholics, Syrian Catholics, Protestant Christians, etc), geographic regions (South Indians, North Indians), language (Marathi, Malayali, Tamilian, Guajarati) etc. The behaviour of people belonging to various subcultures is different. Therefore, marketers may adopt a multicultural marketing approach, i.e., designing and marketing goods and services that cater to the tastes and preferences of consumers belonging to different sub-cultures.

Subculture categories are (Different basis for division of sub-cultural):

(i) Nationality: Indian, Sri Lanka, Pakistan.

(ii) Geographic regions: South India, North-eastern India.

(iii) Religion: Hinduism, Islam.

(iv) Race: Asian, black, white.

(v) Age: young, middle aged, elderly.

(vi) Sex: Male, Female.

(vii) Occupation: Farmer, teacher, business.

(viii) Social class: upper, middle, lower.

Another way that subcultures influence consumer behaviour is by affecting the consumer’s decision making process, or the steps that they take to select, purchase, and use products and services. Subcultures can influence the consumer’s decision making by providing information, advice, feedback, or social pressure.Marketers also measure lifestyles, which are patterns of behaviour (or activities, interests, and opinions). These lifestyles can provide some additional insight into consumers’ consumption patterns.Finally, some marketing researchers use Psychographic techniques that involve all of these factors to predict consumer behaviour. One of the most well known Psychographic tools is the Values and Lifestyle Survey (VALS). The newer VALS2 identifies eight segments of consumers who are similar in their resources and self-orientations.

13. Write short notes on:

(i) Cultural factors.

Ans: Cultural Factors include the basic values, needs, wants, preferences, perceptions, and behaviours that are observed and learned by a consumer from their near family members and other important people around them. Cultural influences can significantly shape the buying decisions of individuals. These factors often dictate preferences, loyalty, and even the willingness to engage with certain products. Below, we explore how various cultural elements such as religion, social status, and gender play pivotal roles in consumer choices.cultural Factors have the broadest and deepest impact on consumer behaviour. This set of factors mainly includes broad culture, subculture, and culture of social classes.

Culture is reflected in terms of followings:

(a) Family life/social system.

(b) Role of women.

(d) Approach to work and leisure.

(e) Approach to life.

(f) Ethnics in economic dealings.

(g) Residence pattern.

(h) Geographic factors.

(i) Impact of other cultures, and so on.

(ii) Reference Groups.

Ans: A reference group is a small group of people such as colleagues at work place, club members, friends circle, neighbours, family members, and so on.

Reference groups influence its members as follows:

(i) They influence members’ values and attitudes.

(ii) They expose members to new behaviours and lifestyles.

(iii) They create pressure to choose certain products or brands.

Reference Groups have potential in forming a person attitude or behaviour. The impact of reference groups varies across products and brands. For example if the product is visible such as dress, shoes, car etc then the influence of reference groups will be high. Reference groups also include opinion leader (a person who influences other because of his special skill, knowledge or other characteristics).

Family buyer behaviour is strongly influenced by the member of a family. Therefore marketers are trying to find the role and influence of the husband, wife and children. If the buying decision of a particular product is influenced by wife than the Marketers will try to target the women in their advertisement. Here we should note that buying roles change with change in consumer lifestyles.

(iii) Social class.

Characteristics of Social Classes:

(a) Persons within a given social class tend to behave more alike.

(b) Social class is hierarchical.

(c) Social class is not measured by a single variable but is measured as a weighted function of one’s occupation, income, wealth, education, status, prestige, etc.

(d) Social class is continuous rather than concrete, with individuals able to move into a higher social class or drop into a lower class.