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Instructor Manual: Consumer Behavior 8th Edition Wayne D. Hoyer, Deborah J. MacInnis, Rik Pieters

Solution Manual For Consumer Behavior 8th Edition Wayne D. Hoyer, Deborah J. MacInnis, Rik Pieters Chapter 1: Understanding Consumer Behavior

TABLE OF CONTENTS Purpose and Perspective of the Chapter ............................... 2 List of Student Downloads ............................................ 3 Chapter Objectives ................................................... 3 Complete List of Chapter Activities and Assessments .................. 3 Key Terms ............................................................ 4 What's New in This Chapter ........................................... 5 Chapter Outline ...................................................... 6 End-Of-Chapter Questions for Review and Discussion .................. 15 Additional Discussion Questions ..................................... 18 Additional Activities and Assignments ............................... 19

Instructor Manual: Chapter 1: Understanding Consumer Behavior

PURPOSE AND PERSPECTIVE OF THE CHAPTER The purpose of this chapter is to explore the fundamentals of consumer behavior. Consumer behavior involves understanding the set of decisions (what, whether, why, when, how, where, how much, and how often) that an individual or group of consumers makes over time about the acquisition, use, or disposition of goods, services, ideas, or other offerings. The psychological core exerts considerable influence on consumer behavior. A consumer‘s motivation, ability, and opportunity affect their decisions and influence what a person is exposed to, what they pay attention to, and what they perceive and comprehend. These factors also affect how consumers categorize and interpret information, how they form and retrieve memories, and how they form and change attitudes. Each aspect of the psychological core has a bearing on the consumer decision-making process, which involves (1) problem recognition, (2) information search, (3) judgments and decision making, and (4) evaluating satisfaction with the decision. Consumer behavior is affected by the consumer‘s culture and by the typical or expected behaviors, norms, and ideas of a particular group. Consumers belong to a number of groups, share their cultural values and beliefs, and use their symbols to communicate group membership. Household and social class influences are involved in consumer behavior, as are each individual‘s values, personality, and lifestyles. Consumer behavior can be symbolic and express an individual‘s identity. It is also indicative of how quickly an offering spreads throughout a market. Further, ethics and social responsibility play a role in consumer behavior. Marketers study consumer behavior to gain insights that will lead to more effective marketing strategies and tactics. Ethicists and advocacy groups are keenly interested in consumer behavior, as are public policy makers and regulators who want to protect consumers from unsafe or inappropriate offerings. Consumers and society can both benefit as marketers learn to make products more user-friendly and to show concern for the environment. Finally, studying consumer behavior helps marketers understand how to segment markets and how to decide which to target, how to position an offering, and which marketing-mix strategies will be most effective. Chapter Appendix This chapter‘s Appendix focuses on consumer behavior research and its special implications for marketers. Students will learn about various research methods, types of data, and ethical issues related to consumer research. With this background, they will be able to understand how consumer research helps marketers develop more effective strategies and tactics for reaching and satisfying customers. 2 © 2024 Cengage. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

Instructor Manual: Chapter 1: Understanding Consumer Behavior

LIST OF STUDENT DOWNLOADS Students should download the following items from the Student Companion Center to complete the activities and assignments related to this chapter: 

Downloadable Student PowerPoints

CHAPTER OBJECTIVES The following objectives are addressed in this chapter: 1-1

Explain the components that make up the definition of consumer behavior.

1-2

Identify the four domains of consumer behavior that affect acquisition, usage, and disposition decisions.

1-3

Discuss the benefits of studying consumer behavior.

1-4

Explain how companies apply consumer behavior concepts when making marketing decisions.

COMPLETE LIST OF CHAPTER ACTIVITIES AND ASSESSMENTS The following table organizes activities and assessments by objective, so that you can see how all this content relates to objectives and make decisions about which content you would like to emphasize in your class based on your objectives. For additional guidance, refer to the Teaching Online Guide. Chapter Objective N/A 1-1 1-2 1-4 1-1 – 1-4

Activity/Assessment

Icebreaker Group Activity Polling Activity Discussion Activity Knowledge Check Activity 1-1 – 1-4 Learn It: Concept Check Quiz: Chapter 01 Understanding Consumer Behavior 1-1 – 1-4 Apply It: Assignment: Chapter 01 Understanding Consumer Behavior 1-1 – 1-4 Apply It: Case

Source (i.e., PPT slide, Workbook) PowerPoint Slide 3 PowerPoint Slide 15 PowerPoint Slide 23 PowerPoint Slide 31 PowerPoint Slide 39

Duration

MindTap Learning Path Chapter 1 Folder

35–45 mins.

MindTap Learning Path Chapter 1 Folder

35–45 mins.

MindTap Learning Path

35–45 mins.

5–10 mins. 15-25 mins. 5–10 mins. 10-15 mins. 5 mins.

Instructor Manual: Chapter 1: Understanding Consumer Behavior

Activity: Chapter 01 Understanding Consumer Behavior

Chapter 1 Folder

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KEY TERMS Chapter 1 Acquisition: The process by which a consumer comes to own or experience an offering. Consumer behavior: The totality of consumers‘ decisions with respect to the acquisition, consumption, and disposition of goods, services, time, places, and ideas by human decision-making units (over time). Culture: The typical or expected behaviors, norms, and ideas that characterize a group of people. Disposition: The process by which a consumer discards an offering. Marketing: The activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings with value for individuals, groups, and society. Offering: A product, service, activity, experience, or idea offered by a marketing organization to consumers. Reference group: A group of people consumers compare themselves with for information regarding behavior, attitudes, or values. Symbols: External signs that consumers use to express their identity. Usage: The process by which a consumer uses or consumes an offering.

Chapter 1 Appendix Conjoint analysis: A research technique to determine the relative importance and appeal of different levels of an offering‘s attributes. Data mining: Searching for patterns in a company database that offer clues to customer needs, preferences, and behaviors. Ethnographic research: In-depth qualitative research using observations and interviews (often over repeated occasions) of consumers in real-world surroundings. Often used to study the meaning that consumers ascribe to a product or consumption phenomenon.

Instructor Manual: Chapter 1: Understanding Consumer Behavior

Focus group: A form of interview involving 8 to 12 people; a moderator leads the group and asks participants to discuss a product, concept, or other marketing stimulus. Independent variable: The ―treatment‖ or the entity that researchers vary in a research project. Market test: A study in which the effectiveness of one or more elements of the marketing mix is examined by evaluating sales of the product in an actual market, for example, a specific city. Netnography: Observing and analyzing the online behavior and comments of consumers. Primary data: Data originating from a researcher and collected to provide information relevant to a specific research project. Research foundation: A nonprofit organization that sponsors research on topics relevant to the foundation‘s goals. Secondary data: Data collected for some other purpose that is subsequently used in a research project. Survey: A method of collecting information from a sample of consumers, predominantly by asking questions. Storytelling: A research method by which consumers are asked to tell stories about product acquisition, usage, or disposition experiences. These stories help marketers gain insights into consumer needs and identify the product attributes that meet these needs. Trade group: A professional organization made up of marketers in the same industry. [return to top]

WHAT'S NEW IN THIS CHAPTER The following elements are improvements in this chapter from the previous edition:     

Updated learning objectives New vignette to illustrate the consumer decision process Numerous new examples Numerous recent academic studies added New exhibits

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Instructor Manual: Chapter 1: Understanding Consumer Behavior

CHAPTER OUTLINE The following outline organizes activities (including any existing discussion questions in PowerPoints or other supplements) and assessments by chapter (and therefore by topic), so that you can see how all the content relates to the topics covered in the text. I.

Defining Consumer Behavior (LO 1-1, PPT Slides 5–15) a. Consumer behavior: The totality of consumers‘ decisions with respect to the acquisition, consumption, and disposition of goods, services, time, places, and ideas by human decision-making units (over time) (See Exhibit 1.1 on PPT Slide 6)  Offering: A product, service, activity, experience, or idea offered by a marketing organization to consumers  Acquisition: The process by which a consumer comes to own or experience an offering  Usage: The process by which a consumer uses or consumes an offering  Disposition: The process by which a consumer discards an offering b. Consumer behavior involves understanding the set of decisions (what, whether, why, when, how, where, how much, and how often) that an individual or group of consumers makes over time.  More than just the way a person buys tangible products like toilet paper and soap  Involves goods, services, activities, experiences, people, and ideas  Reflects totality of consumers‘ decisions with respect to acquisition, usage/consumption, and disposition  Takes into account managing money and balancing financial decisions c. Consumer behavior is a dynamic process.  The sequence of acquisition, consumption, and disposition can occur over time in a dynamic order— hours, days, weeks, months, or years.  Entire markets are designed around linking one consumer‘s disposition decision to other consumers‘ acquisition decisions.  Major life events have a major impact on consumer behavior as well.

Instructor Manual: Chapter 1: Understanding Consumer Behavior

d. Consumer behavior can involve many people.  It does not necessarily reflect the action of a single individual.  Individuals engaging in consumer behavior can take on one or more roles. e. Consumer behavior involves many decisions.  It involves understanding whether, why, when, where, how, how much, how often, and for how long consumers will buy, use, or dispose of an offering.  Decisions are often related to personal goals, safety concerns, or a desire to reduce economic, social, or psychological risk.  Decisions can also be affected by subtle cues in our environment. f. U.S. consumers spend an average of about $90 per day on goods and services in a typical month. (See Table 1.1 on PPT Slide 10)  On average, U.S. consumers spend more for basics like housing, transportation, and food than for other categories of expenditures. g. Consumption can occur for a number of reasons.  Among the most important reasons, are the ways in which an offering meets someone‘s needs, values, or goals.  Acquisition may be related to a consumer‘s attitudes toward money, materialism, status, emotions, and self-control.  Sometimes our reasons for using an offering are filled with conflict, which leads to some difficult consumption decisions. h. Marketers also try to understand why consumers do not acquire, use, or dispose of an offering.  Transparency is increasingly of concern when consumers want to know what a brand or company stands for. i. Table 1.2 in the text shows that there are many ways that consumers can acquire an offering:  Buying  Trading  Renting or Leasing  Bartering  Gifting  Finding  Stealing  Sharing 7 © 2024 Cengage. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

Instructor Manual: Chapter 1: Understanding Consumer Behavior

j. Ways of disposing of an offering include the following:  Find a new use for it  Get rid of it temporarily  Get rid of it permanently k. When to acquire/use/dispose of an offering:  Factors include our perceptions of and attitudes toward time itself  Variety, life transitions, traditions  Knowing when others might or might not be buying or using an offering l. Where to acquire/use/dispose of an offering:  Need for privacy  Convenience m. How much, how often, and how long to acquire/use/dispose of an offering:  Consumers‘ inclination not to waste things  Decision variation from person to person and from culture to culture n. Consumer behavior involves consumer emotions and coping.  Positive and negative emotions can affect how consumers think, the choices they make, how they feel after making a decision, what they remember, and how much they enjoy an experience.  Because issues related to consumer behavior can involve stress, consumers often need to cope in some way.  Consumers often use products to regulate their feelings. o. Group Activity: Break the class into small groups of three to five students and have them complete the activity followed by an instructor-led debrief with the class. (PPT Slide 15) 15–25 minutes total  As a group, identify some marketing strategies and tactics that try to influence one or more of the dimensions of consumer behavior shown in Exhibit 1.1. o Students‘ responses will vary, but possible answers include the following:  Scanning trends and conditions in the market  Identifying how and where consumers purchased various product types  Studying customer lifestyles  Examining consumer income levels  Determining important service aspects, such as type of warranty offered 8 © 2024 Cengage. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

Instructor Manual: Chapter 1: Understanding Consumer Behavior

 II.

Identifying the expected life by consumers of various product types.

What Affects Consumer Behavior? (LO 1-2, PPT Slides 16–23) a. As shown in Exhibit 1.4 (PPT Slide 17), consumer behavior encompasses four domains:  the consumer‘s culture,  the psychological core,  the process of making decisions, and  consumer behavior outcomes and issues. b. Before consumers can make decisions, they must have some source of knowledge or information upon which to base their decisions—known as the psychological core.  Motivation, ability, and opportunity  Exposure, attention, perception, and comprehension  Memory and knowledge  Forming and changing attitudes c. The process of making decisions:  Problem recognition and the search for information  Making judgments and decisions  Making postdecision evaluations d. Consumption decisions and how we process information are affected by culture.  Culture: The typical or expected behaviors, norms, and ideas that characterize a group of people  Reference group: A group of people consumers compare themselves with for information regarding behavior, attitudes, or values  Social, diversity, household, and social class influences  Values, personality, and lifestyle e. Consumer behaviors can symbolize who we are.  Symbols: External signs that consumers use to express their identity  The groups we belong to and our sense of self can affect the symbols we use, consciously or unconsciously, to express our actual or desired identity. f. Consumer behaviors can diffuse through a market.  The diffusion of information can have both negative and positive effects for marketers. g. Consumer behavior outcomes also influence and are influenced by issues of ethics and social responsibility.  Both consumers and marketers can and do use marketing for constructive purposes, balancing short and long9

Instructor Manual: Chapter 1: Understanding Consumer Behavior

term horizons plus the interests of themselves and others. h. Polling Activity: Conduct a poll with the students and then discuss the responses as a group. (PPT Slide 23) 5–10 minutes total  Opinion leaders or ―influencers‖ on social media play a key role in my consumption decisions. o Ask students whether or not their reference groups make them feel as if they should behave in a certain way. o Ask students to consider whether certain types of opinion leaders have a stronger influence on their behavior than others. III.

Who Benefits from the Study Of Consumer Behavior? (LO 1-3, PPT Slides 24–26) a. Various groups use consumer research: marketing managers, ethicists and advocates, public policy makers and regulators, academics, and consumers. b. The study of consumer behavior provides critical information to marketing managers for developing marketing strategies and tactics.  Marketing: The activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings with value for individuals, groups, and society. c. Concerned consumers sometimes form advocacy groups to create public awareness of inappropriate practices.  They also influence other consumers as well as the targeted companies through strategies such as media statements and boycotts. d. Understanding consumer behavior is crucial for legislators, regulators, and government agencies in developing policies and rules to protect consumers from unfair, unsafe, or inappropriate marketing practices.  In turn, marketers‘ decisions are affected by these public policy actions. e. Understanding consumer behavior is important in the academic world.  Academics disseminate knowledge about consumer behavior when they teach courses on the subject.  Academics generate knowledge about consumer behavior when they conduct research focusing on how consumers act, think, and feel when acquiring, using, and disposing of offerings.

Instructor Manual: Chapter 1: Understanding Consumer Behavior



Academic research is useful to marketing managers, advocacy groups, policy makers, regulators, and others who need to understand consumer behavior. f. Understanding consumer behavior enables marketers and other organizations to provide tools for more informed decisionmaking. IV.

Making Business Decisions Based on the Marketing Implications of Consumer Behavior (LO 1-4, PPT Slides 27–30) a. Developing and implementing customer-oriented strategy:  Segmentation of the market  Profitability of each segment  Characteristics of consumers in each segment  Customer satisfaction with existing offerings b. Developing products:  Consumer ideas for new products  Attributes that can be added or changed in existing products  Branding of offering  Appearance of package and logo c. Positioning:  Positioning of competitive offerings  Positioning of one‘s own offerings  Need for repositioning offerings d. Making promotion and marketing communications decisions:  Communication objectives  Appearance of marketing communications  Location, time, and effectiveness of advertising  Sales promotion objectives and tactics  Effectiveness of sales promotions  Salesperson decisions to best serve customers e. Making pricing decisions:  Price range of a product or service  Consumer sensitivity to price and price changes  Pricing tactics to be used f. Making distribution decisions:  Time and convenience of consumers  Assortment of merchandise  Store design g. Discussion Activity: Conduct an instructor-led class discussion. (PPT Slide 31) 10–15 minutes total  What are some specific examples of consumption differences between different cultures?