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What are the 5 steps of the Consumer Decision-Making Process?
- 1) Need Recognition ---"Why we buy"
- 2) Information Search
- 3) Evaluation of Alternatives
- 4) Purchase
- 5) Post-purchase Behavior
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Explain step 1 of the Consumer Decision-Making Process: Need Recognition.
This is triggered when a consumer is exposed to either an internal or external stimulus. Internal stimuli are occurances that you experience (hunger) & External stimuli are outside influences (a friend recommends a great new restaurant).
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Explain step 2 of the Consumer Decision-Making Process: Information Search.
Once a need or want is recognized, information is sought after for the various alternatives available to satisfy it. Internal Information Search (recalls info stored in the memory-primarily from past experience) & External Information Search (seeks info in the outside environment).
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What are the two basic types of external information sources? Explain each.
- Nonmarketing-controlled: is not associated with marketers promoting a product (ex. personal experiences, personal sources, public sources-Consumer Reports)
- Marketing-controlled: is biased toward a specific product because it originated with the promotion of that product (ex. mass-media advertising, salespeople, etc.)
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What factors determine the extent to which an individual conducts an external search?
- Perceived risk
- Knowledge
- Prior experience
- Level of Interest
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What should be the outcome of an external search?
An evoked set (or consideration set)
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What 5 Factors Influence Consumer Buying Decisions?
- Cultural Factors
- Individual Factors
- Social Factors
- Psychological Factors
- Situational Factors
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How does Previous Experience effect the Level of Consumer Involvement?
When consumers have had previous experience with a good or service, the level of involvement typically decreases. (ex. buying Special K cereal)
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How does Interest effect the level of consumer involvement?
It has a direct effect (ex. Bike racers more involved in bicycle purchase)
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How does Perceived Risk effect the level of consumer involvement?
- As the perceived risk in purchasing a product increases, so does a consumer's level of involvement. (ex. new car)
- Three types of perceived risks: Financial, Social & Psychological
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How does Situation effect the level of consumer involvement?
(ex. Buy cheap wine normally until the boss is coming to dinner)
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How does Social Visibility effect the level of consumer involvement?
Items that make a statement and have social visibility increase consumer involvement (ex. clothing brands)
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What are the 4 Factors Influencing Consumer Buying Decisions?
- Cultural
- Social
- Individual
- Psychological
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What are the three components of Cultural Factors influencing buying decisions?
- YOUR culture (values, language, myths, customs) (ex. Swedish food)
- Subculture: A group that share overall cultural traits but also has group specific traits (ex. ethnic groups in the US)
- Social Class: status, based on occupation, income, education & wealth.
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What are some components making up the Individual Factors influencing buying?
- Gender
- Age
- Lifestyle
- Self-Concept
- Famiily Life-Cycle Stage
- Personality
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What are the Social Factors?
- Reference Groups both Direct & Indirect.
- Direct include Primary (friends, family & coworkers) & Secondary (clubs, professional groups, religious groups)
- Indirect include Aspirational (those a person would like to join - ex. athlete) & Non-Aspirational (those a person would not like to be associated with - ex. criminal)
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What are some Psychological Factors influencing buying?
- Belief & Attitudes
- Motivation
- Perception
- Learning
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What are the two forms of learning?
- Experiential (Behavioral) Learning: occurs when an experience changes your behavior (ex. new cold medicine does not relieve symptoms)
- Conceptual (Cognitive) Learning: learning by thinking (ex. don't buy diet drink although never tried it because someone told you artificial sweeteners leave an aftertaste)
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Explain the difference between Stimulus Generalization & Stimulus Discrimination.
- Generalization expands the brand (ex. Crayola now has markers, chalk, etc. all determined good because of Crayola's reputation)
- Discrimination sets itself clearly apart (ex. Method brand clearly different from Lysol)
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What are some Situational Factors that affect the consumer's decision while in the process of making purchase decisions?
- Sale signs
- Coupons
- Cues in the in-store environment
- Sales person behavior
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