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Building Marketing Strategy

Consumer BEHAVIOR eleventh edition

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Consumer Behavior is the most current,

relevant, and balanced presentation

of consumer behavior in the context

of building marketing strategy.

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ISBN 978-0-07-338110-7 MHID 0-07-338110-1

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HAWKINS

MOTHERSBAUGH

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Consumer Behavior Building Marketing Strategy E L E V E N T H E D I T I O N

Del I. Hawkins University of Oregon

David L. Mothersbaugh University of Alabama

Boston Burr Ridge, IL Dubuque, IA New York San Francisco St. Louis Bangkok Bogotá Caracas Kuala Lumpur Lisbon London Madrid Mexico City Milan Montreal New Delhi Santiago Seoul Singapore Sydney Taipei Toronto

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CONSUMER BEHAVIOR: BUILDING MARKETING STRATEGY

Published by McGraw-Hill/Irwin, a business unit of The McGraw-Hill Companies, Inc., 1221 Avenue of the Americas, New York, NY, 10020. Copyright © 2010, 2007, 2004, 2001, 1998, 1994, 1992, 1989, 1986, 1983, 1980 by The McGraw-Hill Companies, Inc. All rights reserved. No part of this publication may be reproduced or distributed in any form or by any means, or stored in a database or retrieval system, without the prior written consent of The McGraw-Hill Companies, Inc., including, but not limited to, in any network or other electronic storage or transmission, or broadcast for distance learning.

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This book is printed on acid-free paper.

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Vice president and editor-in-chief: Brent Gordon Publisher: Paul Ducham Executive editor: Doug Hughes Editorial coordinator: Kelly Pekelder Marketing manager: Katie Mergen Lead project manager: Christine A. Vaughan Senior manager, EDP: Heather D. Burbridge Interior designer: Laurie J. Entringer Senior photo research coordinator: Lori Kramer Photo researcher: Mike Hruby Senior media project manager: Greg Bates Cover and interior design: Laurie J. Entringer Cover image: © Sylvain Sonnett, Getty Images Typeface: 10/12 Times Roman Compositor: Macmillan Publishing Solutions Printer: R. R. Donnelley

Library of Congress Cataloging-in-Publication Data Hawkins, Del I. Consumer behavior: building marketing strategy / Del I. Hawkins, David L. Mothersbaugh.—11th ed. p. cm. Includes index. ISBN-13: 978-0-07-338110-7 (alk. paper) ISBN-10: 0-07-338110-1 (alk. paper) 1. Consumer behavior—United States. 2. Market surveys—United States. 3. Consumer behavior—United States—Case studies. I. Mothersbaugh, David L. II. Title. HF5415.33.U6H38 2010 658.8'3420973—dc22 2008044958

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Preface teacher, and the right topic, you might even produce a masterpiece. The same approach should be taken by one wishing to become a marketing manager, a sales- person, or an advertising director. The various factors or principles that infl uence consumer behavior should be thoroughly studied. Then, one should practice applying these principles until acceptable marketing strategies result. However, while knowledge and practice can in general produce acceptable strategies, great marketing strategies, like masterpieces, require special talents, effort, timing, and some degree of luck (what if Mona Lisa had not wanted her portrait painted?). The art analogy is useful for another reason. All of us, professors and students alike, tend to ask, “How can I use the concept of, say, social class to develop a suc- cessful marketing strategy?” This makes as much sense as an artist asking, “How can I use blue to create a great picture?” Obviously, blue alone will seldom be suffi - cient for a great work of art. Instead, to be successful, the artist must understand when and how to use blue in conjunction with other elements in the picture. Like- wise, the marketing manager must understand when and how to use a knowledge of social class in conjunc- tion with a knowledge of other factors in designing a successful marketing strategy. This book is based on the belief that knowledge of the factors that infl uence consumer behavior can, with practice, be used to develop sound marketing strategy. With this in mind, we have attempted to do three things. First, we present a reasonably comprehensive descrip- tion of the various behavioral concepts and theories that have been found useful for understanding consumer behavior. This is generally done at the beginning of each chapter or at the beginning of major subsections in each chapter. We believe that a person must have a thorough understanding of a concept in order to suc- cessfully apply that concept across different situations. Second, we present examples of how these concepts have been used in the development of marketing strat- egy. We have tried to make clear that these examples are not “how you use this concept.” Rather, they are presented as “how one organization facing a particular marketing situation used this concept.” Third, at the end of each chapter and each major sec- tion, we present a number of questions, activities, or cases that require the student to apply the concepts.

Marketing attempts to infl uence the way consumers behave. These attempts have implications for the orga- nizations making them, the consumers they are trying to infl uence, and the society in which these attempts occur. We are all consumers and we are all members of society, so consumer behavior and attempts to infl u- ence it are critical to all of us. This text is designed to provide an understanding of consumer behavior. This understanding can make us better consumers, better marketers, and better citizens.

MARKETING CAREERS AND CONSUMER BEHAVIOR A primary purpose of this text is to provide the student with a usable, managerial understanding of consumer behavior. Most students in consumer behavior courses aspire to careers in marketing management, sales, or advertising. They hope to acquire knowledge and skills that will be useful to them in these careers. Unfortu- nately, some may be seeking the type of knowledge gained in introductory accounting classes; that is, a set of relatively invariant rules that can be applied across a variety of situations to achieve a fi xed solution that is known to be correct. For these students, the uncertainty and lack of closure involved in dealing with living, breathing, changing, stubborn consumers can be very frustrating. However, if they can accept dealing with endless uncertainty, utilizing an understanding of con- sumer behavior in developing marketing strategy will become tremendously exciting. It is our view that the use of knowledge of consumer behavior in the development of marketing strategy is an art. This is not to suggest that scientifi c principles and procedures are not applicable; rather, it means that the successful application of these principles to particu- lar situations requires human judgment that we are not able to reduce to a fi xed set of rules. Let us consider the analogy with art in some detail. Suppose you want to become an expert artist. You would study known principles of the visual effects of blending various colors, of perspective, and so forth. Then you would practice applying these principles until you developed the ability to produce acceptable paintings. If you had certain natural talents, the right

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iv Preface

text. The objective is to develop the ability to apply consumer behavior knowledge to social and regulatory issues as well as to business and personal issues.

FEATURES OF THE ELEVENTH EDITION Marketing and consumer behavior, like the rest of the world, are changing at a rapid pace. Both the way con- sumers behave and the practices of studying that behav- ior continue to evolve. To keep up with this dynamic environment, the eleventh edition includes a number of important features.

Internet and Technology The Internet and technology are rapidly changing many aspects of consumer behavior. We have integrated the latest research, practices, and examples concerning the Internet and technology throughout the text and the cases. Examples include:

• Online social media and Web 2.0 • Sears Goes Zwicky for Tweens and Teens • Mobile marketing strategies • Techniques for converting Web site visitors to buyers

Global Marketing Previous editions have included a wealth of global material, and this edition is no exception. Most chap- ters contain multiple global examples woven into the text. In addition, Chapter 2 and several of the cases are devoted to global issues. New global examples include:

• Wal-Mart adapts its strategy to developing countries • Emerging segments of global citizens • Seki Saba—repositioning Japanese Mackerel • The changing nature of globalization

Ethnic Subcultures This edition continues our emphasis on the exciting issues surrounding marketing to ethnic subcultures. Ethnic diversity is increasing, and we draw on the lat- est research and emerging trends to shed light on this important topic. Examples include:

• P&G’s My Black Is Beautiful Campaign • Camry Goes Interactive to Attract Black Women • Hispanic Teens—The New Bicultural Youth

CONSUMING AND CONSUMER BEHAVIOR The authors of this book are consumers, as is everyone reading this text. Most of us spend more time buying and consuming than we do working or sleeping. We consume products such as cars and fuel, services such as haircuts and home repairs, and entertainment such as television and concerts. Given the time and energy we devote to consuming, we should strive to be good at it. A knowledge of consumer behavior can be used to enhance our ability to consume wisely. Marketers spend billions of dollars attempting to infl uence what, when, and how you and I consume. Marketers not only spend billions attempting to infl u- ence our behavior but also spend hundreds of millions of dollars studying our behavior. With a knowledge of con- sumer behavior and an understanding of how marketers use this knowledge, we can study marketers. A televi- sion commercial can be an annoying interruption of a favorite program. However, it can also be a fascinating opportunity to speculate on the commercial’s objective, target audience, and underlying behavior assumptions. Indeed, given the ubiquitous nature of commercials, an understanding of how they are attempting to infl uence us or others is essential to understand our environment. Throughout the text, we present examples that illus- trate the objectives of specifi c marketing activities. By studying these examples and the principles on which they are based, we can develop the ability to discern the underlying logic of the marketing activities encoun- tered daily.

SOCIAL RESPONSIBILITY AND CONSUMER BEHAVIOR What are the costs and benefi ts of direct-to-consumer (DTC) advertising of pharmaceutical products? How much more needs to be done to protect the online privacy of children? These issues are currently being debated by industry leaders and consumer advocacy groups. As educated citizens, we have a responsibility to take part in these sorts of debates and work toward positive solutions. However, developing sound positions on these issues requires an understanding of such factors as information processing as it relates to advertising—an important part of our understanding of consumer behavior. The debates described above are just a few of the many that require an understanding of consumer behav- ior. We present a number of these topics throughout the

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Preface v

knowledge of consumer behavior to infl uence consum- ers. A section at the end of each chapter has Internet assignments to enhance students’ understanding of how marketers are approaching consumers using this medium.

DDB Life Style Study™ Data Analyses Each relevant chapter poses a series of questions that require students to analyze data from the annual DDB Life Style Study™ survey. These data are available in spreadsheet format on the disk that accompanies this text. These exercises increase students’ data analy- sis skills as well as their understanding of consumer behavior. The DDB data were completely updated for the tenth edition to include results of the 2004 survey. A major advantage of this new data is that it includes information on behaviors related to Internet use and shopping.

Four-Color Illustrations Print ads, Web pages, storyboards, and photos of point- of-purchase displays and packages appear throughout the text. Each is directly linked to the text material both by text references to each illustration and by the descrip- tive comments that accompany each illustration. These illustrations, which we’ve continued to update with the eleventh edition, provide vivid examples and applications of the concepts and theories presented in the text.

Review Questions The review questions at the end of each chapter allow students or the instructor to test the acquisition of the facts contained in the chapter. The questions require memorization, which we believe is an important, though insuffi cient, part of learning.

Discussion Questions These questions can be used to help develop or test the students’ understanding of the material in the chapter. Answering these questions requires the student to uti- lize the material in the chapter to reach a recommen- dation or solution. However, they can generally be answered without external activities such as customer interviews; therefore, they can be assigned as in-class activities.

Strategic Application This edition continues our emphasis on the application of consumer behavior concepts and theory to exciting marketing problems and important emerging trends. We do this through our opening examples, featured Consumer Insights, and cases. Examples include:

• Jack Link’s Beef Jerky Going Hip and Healthy • Positioning the Yaris • Living in a DVR world • Organic Hits Its Stride

CHAPTER FEATURES Each chapter contains a variety of features designed to enhance students’ understanding of the material as well as to make the material more fun.

Opening Vignettes Each chapter begins with a practical example that introduces the material in the chapter. These involve situations in which businesses, government units, or nonprofi t organizations have used or misused consumer behavior principles.

Consumer Insights These boxed discussions provide an in-depth look at a particularly interesting consumer study or market- ing practice. Each has several questions with it that are designed to encourage critical thinking by the students.

Integrated Coverage of Ethical and Social Issues Marketers face numerous ethical issues as they apply their understanding of consumer behavior in the mar- ketplace. We describe and discuss many of these issues. These discussions are highlighted in the text via an “ethics” icon in the margin. In addition, Chapter 20 is devoted to social and regulation issues relating to mar- keting practice. Several of the cases are also focused on ethical or regulatory issues, including all of the cases following Part Six.

Internet Exercises The Internet is a major source of data on consumer behavior and a medium in which marketers use their

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vi Preface

Consumer Behavior Audit Appendix B provides a format for doing a consumer behavior audit for a proposed marketing strategy. This audit is basically a list of key consumer behavior ques- tions that should be answered for every proposed mar- keting strategy. Many students have found it particularly useful if a term project relating consumer behavior to a fi rm’s actual or proposed strategy is required.

SUPPLEMENTAL LEARNING MATERIALS We have developed a variety of learning materials to enhance the student’s learning experience and to facili- tate the instructor’s teaching activities. Please contact your local Irwin/McGraw-Hill sales representative for assistance in obtaining ancillaries. Or visit the McGraw- Hill Higher Education Web site at www.mhhe.com.

Instructor’s Presentation CD ROM The Instructor’s CD ROM to Accompany Consumer Behavior includes all of the instructor’s resources avail- able for Consumer Behavior in electronic form and an easy interface that makes it even easier to access the specifi c items the instructor wants to use:

• Instructor’s Manual (New Supplemental Exam- ples for Eleventh Edition)

The Instructor’s Manual contains suggestions for teaching the course, learning objectives for each chapter, lecture tips and aids, answers to the end- of-chapter questions, suggested case teaching approaches, and discussion guides for each case. It also includes supplemental examples called CB Press Highlights. These examples are not found in the text and can help enhance classroom presenta- tion and discussion.

• Test Bank and Computerized Test Bank A new and improved test bank was created for the

tenth edition. The eleventh edition maintains our high standards of accuracy and completeness, with over 2,000 questions ranging from multiple-choice, to true-false, to short-answer. These questions are coded according to degree of diffi culty and are designed with the fl exibility to suit your students’ needs and your teaching style. These questions cover all the chapters, including material in the opening

Application Activities The fi nal learning aid at the end of each chapter is a set of application exercises. These require the students to use the material in the chapter in conjunction with exter- nal activities such as visiting stores to observe point-of- purchase displays, interviewing customers or managers, or evaluating television ads. They range in complexity from short evening assignments to term projects.

OTHER LEARNING AIDS IN THE TEXT Three useful sets of learning material are presented outside the chapter format—cases, an overview of con- sumer research methods, and a format for a consumer behavior audit.

Cases There are cases at the end of each major section of the text except the fi rst. Many of the cases can be read in class and used to generate discussion of a particular topic. Students like this approach, and many instructors fi nd it a useful way to motivate class discussion. Other cases are more complex and data intense. They require several hours of effort to analyze. Still others can serve as the basis for a term project. We have used sev- eral cases in this manner with success (the assignment is to develop a marketing plan clearly identifying the consumer behavior constructs that underlie the plan). Each case can be approached from a variety of angles. A number of discussion questions are provided with each case. However, many other questions can be used. In fact, while the cases are placed at the end of the major sections, most lend themselves to discussion at other points in the text as well.

Consumer Research Methods Overview Appendix A provides a brief overview of the more com- monly used research methods in consumer behavior. While not a substitute for a course or text in market- ing research, it is a useful review for students who have completed a research course. It can also serve to provide students who have not had such a course with relevant ter- minology and a very basic understanding of the process and major techniques involved in consumer research.

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Preface vii

ACKNOWLEDGMENTS We enjoy studying, teaching, consulting, and writing about consumer behavior. Most of the faculty we know feel the same. As with every edition of this book, our goal for the eleventh edition has been to make a book that students enjoy reading and that excites them about a fascinating topic. Numerous individuals and organizations helped us in the task of writing this edition. We are grateful for their assistance. At the risk of not thanking all who deserve credit, we would like to thank Martin Horn at DDB, Tom Spencer at Claritas, Jessica Damico at Forrester Research, Dr. Sijun Wang at California State University at Pomona, Dr. Junwu Dong at Guangdong University, Rick Bruner at DoubleClick, Matt Bailey at Site Logic, and Carrie Hollenberg at SRI Consulting Business Intelligence. Maren Kirlin and Casey Findley (The University of Alabama) deserve special thanks for their countless hours of research and analysis. We would also like to thank the many members of the McGraw-Hill Higher Education team, including Dough Hughes, Kelly Pekelder, Katie Mergen, Christine Vaughan, Heather Burbridge, Laurie Entringer, Lori Kramer, Mike Hruby, and Greg Bates. We believe that the eleventh edition is improved because of your efforts: Scott Anderson, Buena Vista University; Linda Anglin, Minnesota State University, Mankato; Yeqing Bao, University of Alabama-Huntsville; Mary E. Briseno, University of the Incarnate Word; Kathy Crockett, Lubbock Christian University; Brent Cunningham, Jacksonville State University; Michael T. Elliott, University of Missouri–St. Louis; Dr. Nitika Garg, University of Mississippi; David Hagenbuch, Messiah College; Karl A. Hickerson, St. Ambrose University; Samira B. Hussein, Johnson County Community College; Joseph Izzo, SUNY Fredonia; John C. Kozup, Villanova University; William Lundstrom, Cleveland State University; Kimberly McNeil, North Carolina A&T State University; Nancy J. Nentl, Metropolitan State University; Dr. Brooke Quigg, Pierce College; Dr. Donna Tillman, California State University–Pomona; and Ramaprasad Unni, Tennessee State University. Finally, to our colleagues at Oregon and Alabama— Thanks for your ongoing support, encouragement and friendship.

Del I. Hawkins David L. Mothersbaugh

vignettes and in the Consumer Insights. Questions are marked with a page number so that instructors can make quick reference back to the book.

• Digital Four-Color Ad Set A set of digital four-color images of ads, picture

boards, point-of-purchase displays, and so forth is included. These items are keyed to specifi c chapters in the text. The Instructor’s Manual relates these items to the relevant concepts in the text.

• PowerPoint Program (New Video Clips for the Eleventh Edition!)

The PowerPoint slides have again been substan- tially enhanced for each chapter. They include the key material from each chapter as well as additional illustrations and examples to enhance the overall classroom experience. A new feature of the Power- Points for the eleventh edition is that each chapter is accompanied by a one- to three-minute video clip that elaborates on one of the chapter concepts. The PowerPoints can be used “off the shelf,” in combina- tion with the instructor’s own materials, and/or can be combined with the digital four-color ad set to cre- ate powerful presentations that include both text and nontext materials.

Video Cases (Now on DVD!) A set of 15 video cases is available to adopters. One third of the videos are new to the eleventh edition and since the tenth edition, all the videos have been replaced. These videos describe fi rm strategies or activities that relate to material in the text. A guide for teaching from the videos is contained in the Instructor’s manual. Examples of videos in the set include:

• Geek Squad: Services and Satisfaction • Oreo: Crafting a Truly Global Brand • Targeting the Premium Dog Market • MINI Cooper: Creating an Iconic Lifestyle Brand

Text Web site The book-specifi c Online Learning Center, located at www.mhhe.com/hawkins11e, offers comprehensive classroom support by providing resources for both instructors and students. For instructors, it gives access to downloadable teaching supplements (Instructor’s Manual and PowerPoint slides), resource links, and PageOut. For students, it offers resource links and quiz- zes for self-testing.

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KNOWING CONSUMER BEHAVIOR Marketing attempts to infl uence the way consumers behave. These attempts have implications for the organizations making the attempt, the consumers they are trying to infl uence, and the society in which these attempts occur. We are all consumers: the authors of this book are consumers, as is everyone reading this text, and we are all members of society, so consumer behavior, and attempts to infl uence it, are critical to all of us. This text is designed to provide an understanding of consumer behavior. This understanding can make us better consum- ers, better marketers, and better citizens.

Throughout the text, we present examples that illustrate the objectives of specifi c mar- keting activities. By studying these exam- ples and the principles on which they are based, one can develop the ability to discern the underlying logic of the marketing activi- ties encountered daily. Given the time and energy we devote to consuming, we should strive to be good at it, and a knowledge of consumer behavior can be used to enhance our ability to consume wisely.

Opening Vignette The chapter openers feature vignettes that focus on practical examples that introduce the consumer behavior concepts covered in the chapter.

Walkthrough

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ILLUSTRATION 9–1

Successful new

products and brands

must enter into

memory in a favor-

able manner, and

they must be recalled

when required. In

this case, the brand

name, the visual in

the ad, and the ad

text will enhance

elaborative activities

appropriate for the

product.

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Four-Color Illustrations Print ads, Web pages, storyboards, and photos of point-of-purchase dis- plays and packages appear throughout the text.

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ix

Part Four Cases

CASE 4–1 SEARS GOES ZWINKY FOR TWEENS AND TEENS

Sears has struggled over the years. While some categories, such as Craftsman tools, have been a perennial hit, other categories, particularly apparel, have struggled. Sears has made numerous efforts, including the addition of Lands’ End and the Covington collection, as well as the refur- bishing of out-of-date stores. While Sears may not be the coolest brand around, the data in Table A for tween and teen girls suggest that in terms of store visits, Sears beats out retailers such as Gap, Macy’s, and Wet Seal.

tool? Social networking! Their message? “Don’t Just Go Back. Arrive.” According to one source:

Thirteen sites have partnered with Sears to create custom animation, virtual worlds and social networking applica- tions aimed at driving the target market to the Sears online “Arrive Lounge.” [Arrive Lounge] features exclusive, interactive content from the entire Sears 2008 back to school offering.

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What Are the Ethical Implications of Marketing This Product in This Country? All marketing programs should be evaluated on ethical as well as financial dimensions. As discussed at the beginning of the chapter, international marketing activities raise many eth- ical issues. The ethical dimension is particularly important and complex in marketing to Third World and developing countries. Consider Kellogg’s attempt to introduce cold cereal as a breakfast food in a developing country. An ethical analysis would consider various fac- tors including:

If we succeed, will the average nutrition level be increased or decreased?

If we succeed, will the funds spent on cereal be diverted from other uses with more ben- eficial long-term impacts for the individuals or society?

If we succeed, what impact will this have on the local producers of currently consumed breakfast products?

Such an ethical analysis not only is the right thing to do; it may head off conflicts with local governments or economic interests. Understanding and acting on ethical considerations in international marketing is a difficult task. However, it is also a necessary one.

DDB LIFE STYLE STUDY™ DATA ANALYSES

1. Examine the DDB data in Tables 1B through 7B. What characterizes someone who wants to look a little different from others? Which factors contrib- ute most? Which of McGuire’s motives does this most relate to, and what are the marketing implica- tions of your fi ndings?

2. What characterizes someone who views shopping as a form of entertainment (Tables 1B through 7B)? Which factors contribute most? How do your

fi ndings relate to the information presented in Consumer Insight 10–1?

3. Some people feel (and act) more self-confi dent than others. Based on the DDB data (Tables 1B through 7B), what factors are most characteristic of highly confi dent individuals? Which of the Big Five per- sonality dimensions does self-confi dence relate most to, and what are the marketing implications of your fi ndings?

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APPLICATION ACTIVITIES

42. Interview two students from two different cultures. Determine the extent to which the following are used in those cultures and the variations in the values of those cultures that relate to the use of these products: a. Gift cards b. Energy drinks (like Red Bull) c. Fast-food restaurants d. Exercise equipment e. Music f. Internet

45. Interview a student from India. Report on the advice that the student would give an American fi rm marketing consumer products in India.

46. Interview two students from EU (European Union) countries. Report on the extent to which they feel the EU will be a homogeneous culture by 2025.

47. Imagine you are a consultant working with your state or province’s tourism agency. You have been asked to advise the agency on the best promotional themes to use to attract foreign tourists. What would you recommend if Germany and Australia

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Part-Ending Cases There are cases at the end of each major section of the text that can be approached from a variety of angles. They can be utilized for class discussion, more intense efforts of analysis, or as the basis for a term project.

Ethical/Social Issues The discussions regarding the numerous ethical issues facing marketers are highlighted in the margin throughout the text.

DDB Life Style Study™ Data Analyses Each relevant chapter poses a series of questions geared toward helping students increase their data analysis skills as well as their understanding of consumer behavior.

End-of-Chapter Materials At the end of each chapter are a series of learning tools including Internet Exercises, Review Questions, Discussion Questions, and Application Activities.

Consumer Behavior

115

The Changing American Society: Demographics and Social Stratification

Technology is hot. And marketers want to

know who the heavy users are and what traits

characterize them so they can better understand

this market and meet their needs. Scarborough

Research recently conducted a national sur-

vey of adults 18 and older to find what they

call the Digital Savvy consumer. 1 Digital Savvy

consumers are leading-edge digital users who

are early adopters and diffusers of information

related to technology in terms of (1) technology

ownership, (2) Internet usage, and (3) cell phone

feature usage. Scarborough identified 18 differ-

ent behaviors relating to these three dimensions

that differentiated the Digital Savvy from the

general population. Digital Savvy consumers are

those who meet 8 or more of the 18 total tech-

nology behaviors. They represent 6 percent of

the U.S. population, or roughly 14 million adults!

Having identified this group, Scarborough went

about characterizing it in terms of tech behav-

iors, demographics, lifestyle, and media usage.

Some of the key results include:

• Technology Behaviors: The Digital Savvy outstrip the general population in every cat-

egory of technology, including MP3 and DVR

ownership, online banking, online streaming

video, text messaging, and e-mail use via

cell phone.

• Demographics: The Digital Savvy have a very distinct demographic profile. They trended

younger, white collar, male, higher educa-

tion, higher income. And while it is com-

monly believed that technology is mostly a

youth market, Digital Savvy consumers are

found across all age categories, and the

youngest age category is not even the most

Digital Savvy. The table below shows the

age distribution of Digital Savvy consumers

compared with the general population.

44

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115

differentiated the Digital Savvy from the

ral population. Digital Savvy consumers are

who meet 8 or more of the 18 total tech-

y behaviors. They represent 6 percent of

.S. population, or roughly 14 million adults!

g identified this group, Scarborough went

t characterizing it in terms of tech behav-

youth market, Digital Savvy consumers are

found across all age categories, and the

youngest age category is not even the most

Digital Savvy. The table below shows the

age distribution of Digital Savvy consumers

compared with the general population.

C o n s u m e r I n s i g h t 7 – 1

Online Social Media, Consumer-Generated Content, and WOM

Social media is part of an ongoing revolution online, sometimes referred to as Web 2.0, which involves technologies that allow users to leverage the unique interactive and collaborative capabilities of the Internet. These technologies and formats include online commu- nities, social network sites of all types, consumer review sites, and blogs or online journals kept by individuals and companies and distributed across the Web. Online social media allow users not only to form, join, and communicate with groups and individuals online, but also to create and distribute original content in ways not possible in the past. Such consumer-generated content is changing the marketing landscape. Marketers no lon- ger completely control the communications process but now are both observers and participants in an ongoing dialogue that often is driven by consumers themselves.27

An example of consumer-generated content in online social network sites is a video titled “Fully Sub- merged Jeep.” It shows an amateur video posted on Metacafe of a Jeep event in which someone takes

fans to create commercials using the same mate- rial Chevy provided. Or better yet—GM could have allowed them to use their own videos, images, and music to create truly personalized commercials.

In this new world of social media, there are numer- ous categories of participants. These include:29

• Creators—these folks create content of their own—Web pages, blogs, video and video uploads to places like YouTube. Creators tend to be in the teens and early twenties.

• Critics—these folks are bloggers and post ratings and reviews. Critics tend to be a bit older than creators—more in the late teens and mid-twenties.

• Joiners—these folks utilize social networking sites. Joiners range mostly from teens to late twenties. Joiners are a much larger proportion of the population than creators and critics.

• Spectators—these folks consume other people’s content by reading blogs, watching videos, and

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Consumer Insight These boxed discussions provide an in-depth look at a particularly interesting consumer study or marketing practice.

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xi

from two-person households, 84.3 percent of those from households with three, four, or fi ve members, and 88.5 percent of those from households with six or more members. It is possible to combine columns within variables. That is, we can determine the percent of one- and two- person households combined that purchased clothes online. Because the number of respondents on which the percentages are based differs across columns, we can’t simply average the cell percentage fi gures. Instead, we need to convert the cell percentages to numbers by multiplying each cell percentage times the number in the sample for that column. Add the numbers for the cells to be combined together and divide the result by the sum of the number in the sample for the combined cells’ columns. The result is the percentage of the com- bined column categories that engaged in the behavior of interest. The data available on the disk are described below.

COLUMN VARIABLES FOR THE DATA TABLES

Tables 1A & 1B Household size, marital status, number of

children at home, age of youngest child at home, age of oldest child at home.

2A & 2B For married female respondents, their spouse’s level of employment. For mar- ried male respondents, their spouse’s level of employment.

3A & 3B Household income, education level of respondent, perceived tech savvy.

4A & 4B Occupation of respondent.

5A & 5B Ethnic subculture, age, cognitive age (feel a lot younger than my age).

6A & 6B Gender, geographic region.

DDB Worldwide is one of the leading advertising agen- cies in the world. One of the many services it provides for its clients, as well as to support its own creative and strategy efforts, is a major annual lifestyle survey. This survey is conducted using a panel maintained by Syno- vate. In a panel such as this, consumers are recruited such that the panel has demographic characteristics similar to the U.S. population. Members of the panel agree to complete questions on a periodic basis.

THE DATA The 2004 DDB Life Style Study™ involved more than 3,300 completed questionnaires. These lengthy ques- tionnaires included hundreds of attitude, activity, inter- est, opinion, and behavior items relating to consumers, their consumption, and their lifestyles. The question- naires also contained numerous questions collecting demographic and media preference data. DDB has allowed us to provide a portion of these data in spreadsheet format in the disk that accompanies this text. The data are presented in the form of cross- tabulations at an aggregate level with the cell values being percents. For example,

DDB Life Style Study™ Data Analyses

Household Size

1 2 3–5 6�

Number in Sample 523 1294 1351 133

Own a DVD Player 49.0% 68.2% 84.3% 88.5% Purchased clothes online 11.0 12.4 15.3 13.1 Vi sited a fast-food

restaurant 46.6 54.1 69.1 74.7

The example indicates that 49.0 percent of the 523 respondents from one-person households own a DVD player, compared with 68.2 percent of the 1,294

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xii DDB Life Style Study™ Data Analyses

MP3 player

Personal computer

Cellular phone

Individual retirement account

Car

Home

ATV or off-road motorcycle

Dog

Cat

Types of TV Shows Watched Regularly Children’s shows

Comedy

Drama

Home improvement

News/political

Religious programming

Sports

Weather

ROW VARIABLES FOR TABLES 1B THROUGH 7B

Attitude/Activity/Interest/ Behavior Relating to . . . Culture

Enjoy shopping for items infl uenced by other cultures

Interested in the cultures of other countries

Values I work hard most of the time

Religion is a big part of my life

Men concerned with latest styles and fashions aren’t masculine

Make a special effort to buy from environmentally friendly businesses

Work at trying to maintain a youthful appearance

A commercial that features people of my race speaks more directly to me

There is not enough ethnic diversity in commercials today

I make a strong effort to recycle

7A & 7B Ideal self-concept traits (adventurous, affectionate, ambitious, assertive, care- ful, competitive, easy-going, indepen- dent, masculine, sensitive, tolerant, traditional, youthful).

ROW VARIABLES FOR TABLES 1A THROUGH 7A

Heavier User Behaviors and Product Ownership General Behaviors

Read books/articles about health

Visited gourmet coffee bar or café

Visited fast-food restaurant

Went on weight reducing diet

Went dancing at a club

Played bingo

Worked in the garden

Jogged

Went camping

Rented a DVD

Traveled to another country

Attended church/place of worship

Consumption Behaviors Dessert

Diet sodas

Sports drinks

Cordials, liqueurs or other after-dinner drinks

Chocolate bars

Premium ice cream

Shopping Activities Purchased from mail order catalog

Shopped at a convenience store

Purchased items for home at discount retailer

Bought a store’s own brand

Used a price coupon

Product Ownership DVD

PVR

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DDB Life Style Study™ Data Analyses xiii

Consider myself tech savvy

In making big decisions, I go with my heart rather than my head

Making purchases with a credit card over the Inter- net is too risky

Worry about others getting private information about me

Shopping and Loyalty Am an impulse buyer

Stick with favorite brand even if something else is on sale

Pay more for better service

Our family is in too much debt

Marketing Regulation Avoid buying products advertised on shows with sex or violence

TV commercials place too much emphasis on sex

Most big companies are just out for themselves

Advertising directed at children should be taken off TV

Internet Use and Purchase Used the Internet in the past 12 months

Purchased auto insurance online

Purchased clothes online

Purchased concert/play/sports tickets online

Gender and Family Individuality is an important value to pass down to kids

A woman’s place is in the home

When making family decisions, consideration of the kids comes fi rst

Brands, Innovators, and Opinion Leadership Friends and neighbors come to me for advice about brands and products

I am usually among the fi rst to try a new product

I try to stick to well-known brand names

Motivation, Personality, and Extended Self View shopping as a form of entertainment

Want to look a little different from others

Have more self-confi dence than friends

Brands I buy are a refl ection of who I am

The car I drive is a refl ection of who I am

Clothes I wear refl ect who I am as a person

Information Search and Decision Making Consult consumer reports before making a major purchase

Nutritional information on label infl uences what I buy

Information in advertising helps me to make better decisions

The Internet is the best place to get information about products and services

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xv

CHAPTER TEN Motivation, Personality, and Emotion 359

CHAPTER ELEVEN Attitudes and Infl uencing Attitudes 391

CHAPTER TWELVE Self-Concept and Lifestyle 427

■ Part Three Cases Cases 3–1 through 3–9 454

Part Four Consumer Decision Process 466

CHAPTER THIRTEEN Situational Infl uences 469

CHAPTER FOURTEEN Consumer Decision Process and Problem Recognition 495

CHAPTER FIFTEEN Information Search 517

CHAPTER SIXTEEN Alternative Evaluation and Selection 549

CHAPTER SEVENTEEN Outlet Selection and Purchase 581

CHAPTER EIGHTEEN Postpurchase Processes, Customer Satisfaction, and Customer Commitment 621

■ Part Four Cases Cases 4–1 through 4–7 656

Part Five Organizations as Consumers 664

CHAPTER NINETEEN Organizational Buyer Behavior 667

■ Part Five Cases Cases 5–1 and 5–2 693

Part One Introduction 2

CHAPTER ONE Consumer Behavior and Marketing Strategy 5

Part Two External Infl uences 36

CHAPTER TWO Cross-Cultural Variations in Consumer Behavior 39

CHAPTER THREE The Changing American Society: Values 81

CHAPTER FOUR The Changing American Society: Demographics and Social Stratifi cation 115

CHAPTER FIVE The Changing American Society: Subcultures 155

CHAPTER SIX The American Society: Families and Households 193

CHAPTER SEVEN Group Infl uences on Consumer Behavior 225

■ Part Two Cases Cases 2–1 through 2–9 264

Part Three Internal Infl uences 274

CHAPTER EIGHT Perception 277

CHAPTER NINE Learning, Memory, and Product Positioning 317

Brief Contents

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xvi Brief Contents

■ Part Six Cases Cases 6–1 and 6–2 725

Appendix A Consumer Research Methods 727 Appendix B Consumer Behavior Audit 738

Photo Credits 745

Indexes 747

Part Six Consumer Behavior and Marketing Regulation 696

CHAPTER TWENTY Marketing Regulation and Consumer Behavior 699

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xvii

Part Two External Infl uences 36

CHAPTER TWO Cross-Cultural Variations in Consumer Behavior 39

The Concept of Culture 42

Variations in Cultural Values 44

Other-Oriented Values 46

Environment-Oriented Values 51

Self-Oriented Values 53

Cultural Variations in Nonverbal Communications 56

Time 57

Space 59

Symbols 59

Relationships 60

Agreements 61

Things 62

Etiquette 62

Conclusions on Nonverbal Communications 63

Global Cultures 63

A Global Youth Culture? 64

Global Demographics 66

Cross-Cultural Marketing Strategy 68

Considerations in Approaching a Foreign Market 69

Summary 71

CHAPTER THREE The Changing American Society: Values 81

Changes in American Cultural Values 82

Self-Oriented Values 84

Environment-Oriented Values 88

Other-Oriented Values 91

Marketing Strategy and Values 93

Green Marketing 94

Cause-Related Marketing 94

Marketing to Gay and Lesbian Consumers 98

Gender-Based Marketing 101

Summary 107

Preface iii

Part One Introduction 2

CHAPTER ONE Consumer Behavior and Marketing Strategy 5

Applications of Consumer Behavior 9

Marketing Strategy 9

Regulatory Policy 9

Social Marketing 9

Informed Individuals 10

Marketing Strategy and Consumer Behavior 11

Market Analysis Components 14

The Consumers 14

The Company 15

The Competitors 15

The Conditions 16

Market Segmentation 16

Product-Related Need Sets 16

Customers with Similar Need Sets 18

Description of Each Group 18

Attractive Segment(s) to Serve 18

Marketing Strategy 19

The Product 19

Communications 20

Price 21

Distribution 22

Service 22

Consumer Decisions 23

Outcomes 23

Firm Outcomes 23

Individual Outcomes 23

Society Outcomes 25

The Nature of Consumer Behavior 26

External Infl uences (Part Two) 27

Internal Infl uences (Part Three) 28

Self-Concept and Lifestyle 28

Consumer Decision Process (Part Four) 29

Organizations (Part Five) and Regulation (Part Six) 29

The Meaning of Consumption 30

Summary 31

Contents

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xviii Contents

Religious Subcultures 179

Christian Subcultures 179

Non-Christian Subcultures 182

Regional Subcultures 183

Summary 184

CHAPTER SIX The American Society: Families and Households 193

The Nature of American Households 195

Types of Households 195

The Household Life Cycle 197

Marketing Strategy Based on the Household Life Cycle 206

Family Decision Making 207

The Nature of Family Purchase Roles 208

Determinants of Family Purchase Roles 210

Confl ict Resolution 211

Conclusions on Family Decision Making 213

Marketing Strategy and Family Decision Making 213

Consumer Socialization 214

The Ability of Children to Learn 214

The Content of Consumer Socialization 214

The Process of Consumer Socialization 215

The Supermarket as a Classroom 216

Marketing to Children 217

Summary 218

CHAPTER SEVEN Group Infl uences on Consumer Behavior 225

Types of Groups 226

Consumption Subcultures 228

Brand Communities 230

Online Communities and Social Networks 231

Reference Group Infl uences on the Consumption Process 233

The Nature of Reference Group Infl uence 234

Degree of Reference Group Infl uence 236

Marketing Strategies Based on Reference Group Infl uences 237

Personal Sales Strategies 237

Advertising Strategies 238

Communications within Groups and Opinion Leadership 238

Situations in Which WOM and Opinion Leadership Occur 241

CHAPTER FOUR The Changing American Society: Demographics and Social Stratifi cation 115

Demographics 116

Population Size and Distribution 117

Occupation 117

Education 117

Income 119

Age 122

Understanding American Generations 124

Pre-Depression Generation 125

Depression Generation 125

Baby Boom Generation 127

Generation X 129

Generation Y 132

Tweens 135

Social Stratifi cation 135

Social Structure in the United States 136

Upper Americans 138

Middle Americans 140

Lower Americans 141

The Measurement of Social Class 143

Social Stratifi cation and Marketing Strategy 145

Summary 146

CHAPTER FIVE The Changing American Society: Subcultures 155

The Nature of Subcultures 156

Ethnic Subcultures 158

African Americans 160

Consumer Groups 161

Media Usage 162

Marketing to African Americans 163

Hispanics 165

Acculturation, Language, and Generational Infl uences 165

Marketing to Hispanics 169

Asian Americans 172

Consumer Segments and Trends 174

Marketing to Asian Americans 175

Native Americans 176

Asian-Indian Americans 177

Arab Americans 178

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Contents xix

Advertisements 306

Package Design and Labeling 306

Summary 307

CHAPTER NINE Learning, Memory, and Product Positioning 317

Nature of Learning and Memory 318

Memory’s Role in Learning 319

Short-Term Memory 319

Long-Term Memory 321

Learning Under High and Low Involvement 325

Conditioning 326

Cognitive Learning 331

Learning to Generalize and Differentiate 332

Summary of Learning Theories 333

Learning, Memory, and Retrieval 334

Strength of Learning 335

Memory Interference 341

Response Environment 342

Brand Image and Product Positioning 342

Brand Image 342

Product Positioning 344

Product Repositioning 346

Brand Equity and Brand Leverage 347

Summary 350

CHAPTER TEN Motivation, Personality, and Emotion 359

The Nature of Motivation 360

Maslow’s Hierarchy of Needs 360

McGuire’s Psychological Motives 361

Motivation Theory and Marketing Strategy 367

Discovering Purchase Motives 367

Marketing Strategies Based on Multiple Motives 369

Motivation and Consumer Involvement 369

Marketing Strategies Based on Motivation Confl ict 370

Marketing Strategies Based on Regulatory Focus 372

Personality 373

Multitrait Approach 374

Single-Trait Approach 375

The Use of Personality in Marketing Practice 375

Communicating Brand Personality 377

Emotion 378

Types of Emotions 379

Characteristics of Opinion Leaders 242

Marketing Strategy, WOM, and Opinion Leadership 244

Diffusion of Innovations 248

Categories of Innovations 248

Diffusion Process 251

Marketing Strategies and the Diffusion Process 255

Summary 256

■ PART TWO CASES Case 2–1 Starbucks Keeps It Brewing in Asia 264 Case 2–2 The Crest Whitestrip Challenge 265 Case 2–3 Camry Goes Interactive to Attract Black Women 267 Case 2–4 Renault’s Logan Taps Emerging Global Markets 268 Case 2–5 Offi ce Depot Leads in Green 269 Case 2–6 Rede Golf Disposable Golf Cleats 270 Case 2–7 The Mosquito Magnet 271 Case 2–8 Tapping the Ethnic Housing Market 271 Case 2–9 Fighting Obesity in Kids 273

Part Three Internal Infl uences 274

CHAPTER EIGHT Perception 277

The Nature of Perception 278

Exposure 279

Selective Exposure 279

Voluntary Exposure 282

Attention 283

Stimulus Factors 284

Individual Factors 290

Situational Factors 291

Nonfocused Attention 291

Interpretation 293

Individual Characteristics 294

Situational Characteristics 296

Stimulus Characteristics 296

Consumer Inferences 300

Perception and Marketing Strategy 302

Retail Strategy 303

Brand Name and Logo Development 303

Media Strategy 305

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xx Contents

The VALS™ System 439

The VALS™ Segments 440

Geo-Lifestyle Analysis (PRIZM) 444

PRIZM Social and Life Stage Groups 444

Sample PRIZM Segments 445

Applications of PRIZM in Marketing Strategy 446

International Lifestyles 447

Summary 448

■ PART THREE CASES Case 3–1 K9-Quencher Targets Premium Pet Market 454 Case 3–2 Levi’s Signature Stretch 455 Case 3–3 Jack Link’s Beef Jerky Going Hip and Healthy 457 Case 3–4 Clorox Green Works Line 458 Case 3–5 The Psychographics of Luxury Shoppers 459 Case 3–6 Revlon for Men? Ubersexuals and the changing Male Landscape 460 Case 3–7 Positioning the Yaris 462 Case 3–8 Hardiplank’s Pull Strategy 463 Case 3–9 Framing Preventive Care 464

Part Four Consumer Decision Process 466

CHAPTER THIRTEEN Situational Infl uences 469

The Nature of Situational Infl uence 470

The Communications Situation 470

The Purchase Situation 472

The Usage Situation 472

The Disposition Situation 473

Situational Characteristics and Consumption Behavior 474

Physical Surroundings 474

Social Surroundings 477

Temporal Perspectives 480

Task Defi nition 481

Antecedent States 481

Ritual Situations 483

Situational Infl uences and Marketing Strategy 485

Summary 487

Emotions and Marketing Strategy 379

Emotion Arousal as a Product and Retail Benefi t 379

Emotion Reduction as a Product and Retail Benefi t 380

Consumer Copying in Product and Service Encounters 381

Emotion in Advertising 381

Summary 383

CHAPTER ELEVEN Attitudes and Infl uencing Attitudes 391

Attitude Components 392

Cognitive Component 392

Affective Component 395

Behavioral Component 397

Component Consistency 398

Attitude Change Strategies 400

Change the Cognitive Component 400

Change the Affective Component 402

Change the Behavioral Component 403

Individual and Situational Characteristics That Infl uence Attitude Change 404

Cue Relevance and Competitive Situation 404

Consumer Resistance to Persuasion 405

Communication Characteristics That Infl uence Attitude Formation and Change 407

Source Characteristics 407

Appeal Characteristics 410

Message Structure Characteristics 415

Market Segmentation and Product Development Strategies Based on Attitudes 416

Market Segmentation 416

Product Development 416

Summary 418

CHAPTER TWELVE Self-Concept and Lifestyle 427

Self-Concept 428

Interdependent/Independent Self-Concepts 428

Possessions and the Extended Self 429

Measuring Self-Concept 430

Using Self-Concept to Position Products 432

Marketing Ethics and the Self-Concept 433

The Nature of Lifestyle 434

Measurement of Lifestyle 435

General versus Specifi c Lifestyle Schemes 436

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Contents xxi

CHAPTER SIXTEEN Alternative Evaluation and Selection 549

How Consumers Make Choices 550

Affective Choice 552

Attribute-Based versus Attitude-Based Choice Processes 553

Evaluative Criteria 556

Nature of Evaluative Criteria 556

Measurement of Evaluative Criteria 558

Individual Judgment and Evaluative Criteria 561

Accuracy of Individual Judgments 561

Use of Surrogate Indicators 562

The Relative Importance and Infl uence of Evaluative Criteria 563

Evaluative Criteria, Individual Judgments, and Marketing Strategy 563

Decision Rules for Attribute-Based Choices 564

Conjunctive Decision Rule 565

Disjunctive Decision Rule 566

Elimination-by-Aspects Decision Rule 567

Lexicographic Decision Rule 569

Compensatory Decision Rule 570

Summary of Decision Rules 572

Summary 572

CHAPTER SEVENTEEN Outlet Selection and Purchase 581

Outlet Choice versus Product Choice 582

The Retail Scene 583

Internet Retailing 584

Store-Based Retailing 589

The Internet as Part of a Multi-Channel Strategy 590

Attributes Affecting Retail Outlet Selection 593

Outlet Image 594