| Consumer Markets and Consumer Buyer Behavior 133

Chapter 5 | Consumer Markets and Consumer Buyer Behavior 133

of consumers and understand what will captivate them,” says one analyst. Apple has been “obsessed with the Ap- ple user’s experience.”

Apple’s obsession with un- derstanding customers and deep- ening their Apple experience shows in everything the company does. For example, a visit to an Ap- ple retail store is a lot more than a simple shopping trip. Apple stores are very seductive places. The store design is clean, simple, and just oozing with style—much like an iPod or iPhone. The stores in- vite shoppers to stay a while, use the equipment, and soak up all of the exciting new technology:

It was two o’clock in the morn- ing but in the subterranean retailing mecca in Midtown

strongest repurchase intent of any Apple plays to deep-seated

Manhattan, otherwise known as the Apple store, it might as

personal computer brand: 81 per- customer buying needs in

well have been midafternoon. Late one night shortly before

cent of households with an Apple as everything it makes and

Christmas, parents pushed strollers, and tourists straight off

their primary home personal com- sells. The company has

the plane mingled with nocturnal New Yorkers, clicking

puter plan to repurchase an Apple.

gained a cultlike following

through iPod playlists, cruising the Internet on Macs, and

In turn, the consumer love af- because it somehow

touch-padding their way around iPhones. And through the

fair with Apple has produced stun- manages to breathe new

night, cheerful sales staff stayed busy, ringing up customers

ning sales and profit results. In the life into every category it

at the main checkout counter and on handheld devices in an

past five years, despite the worst touches.

uninterrupted stream of brick-and-mortar commerce.

economic conditions since the Great

Not only has the company made many of its stores feel Depression, Apple sales have nearly tripled to a record $36.5 bil- like gathering places, but the bright lights and equally

lion, while earnings soared more than fourfold. The company was bright acoustics create a buzz that makes customers feel

worth only $5 billion in 2000; it’s worth about $170 billion today. more like they are at an event than a retail store. Apple

Apple captures more than 30 percent of the U.S. cell phone mar- stores encourage a lot of purchasing, to be sure. But they

ket with the iPhone and more than 73 percent of the MP3 market also encourage lingering, with dozens of fully functioning

with the iPod and iTunes. Last year alone, it sold more than computers, iPods, and iPhones for visitors to try—for hours

20 million iPhones and 54 million iPods. Apple now claims a on end. The policy has even given some stores, especially

9 percent share of the U.S. personal computer market—third be- those in urban neighborhoods, the feel of a community cen-

hind HP and Dell. But it dominates the high-end, accounting for ter. You don’t visit an Apple store; you experience it.

an amazing 90 percent of dollars spent on computers costing more than $1,000.

Apple’s keen understanding of customers and their needs “To say Apple is hot just doesn’t do the company justice,” con- helped the brand to build a core segment of enthusiastic disciples.

cludes one Apple watcher. “Apple is smoking, searing, blisteringly The most recent American Consumer Satisfaction Index gave

hot, not to mention hip, with a side order of funky. Gadget geeks Apple a market-leading customer-satisfaction score of 84, a full

around the world have crowned Apple the keeper of all things

10 points above the rest of the pack in the personal computer cool.” Just ask your Macolyte friends. In fact—they’ve probably al- industry. Another survey showed that Apple commands the

ready brought it up. 1

The Apple

example shows that factors at many levels affect consumer buy-

Consumer buyer behavior

The buying behavior of final consumers— ing behavior. Buying behavior is never simple, yet understanding it is an essential task of

marketing management. Consumer buyer behavior refers to the buying behavior of fi-

individuals and households that buy

goods and services for personal nal consumers—individuals and households that buy goods and services for personal con- consumption.

sumption. All of these final consumers combine to make up the consumer market . The

American consumer market consists of more than 308 million people who consume more All the individuals and households that

Consumer market

than $10 trillion worth of goods and services each year, making it one of the most attractive buy or acquire goods and services for

consumer markets in the world. The world consumer market consists of more than 6.8 bil- personal consumption.

lion people who annually consume an estimated $70 trillion worth of goods and services. 2

Objective OUTLINE

Define the consumer market and construct a simple model of consumer buyer behavior. Model of Consumer Behavior (pp 134–135)

Name the four major factors that influence consumer buyer behavior. Characteristics Affecting Consumer Behavior (pp 135–150)

List and define the major types of buying decision behavior and the stages in the buyer decision process.

Types of Buying Decision Behavior (pp 150–152) The Buyer Decision Process (pp 152–156)

Describe the adoption and diffusion process for new products. The Buyer Decision Process for New Products (pp 156–158)

Consumers around the world vary tremendously in age, income, education level, and tastes. They also buy an incredible variety of goods and services. How these diverse con- sumers relate with each other and with other elements of the world around them impacts their choices among various products, services, and companies. Here we examine the fasci- nating array of factors that affect consumer behavior.

Author Despite the simple-looking Comment

Model of Consumer Behavior

(pp 134–135)

model in Figure 5.1,

understanding the whys of buying Consumers make many buying decisions every day, and the buying decision is the focal behavior is very difficult. Says one expert, “the mind is a whirling,

point of the marketer’s effort. Most large companies research consumer buying decisions in swirling, jumbled mass of neurons

great detail to answer questions about what consumers buy, where they buy, how and how bouncing around. . . .”

much they buy, when they buy, and why they buy. Marketers can study actual consumer purchases to find out what they buy, where, and how much. But learning about the whys of consumer buying behavior is not so easy—the answers are often locked deep within the con- sumer’s mind.

Often, consumers themselves don’t know exactly what influences their purchases. “The human mind doesn’t work in a linear way,” says one marketing expert. “The idea that the mind is a computer with storage compartments where brands or logos or recognizable pack- ages are stored in clearly marked folders that can be accessed by cleverly written ads or com- mercials simply doesn’t exist. Instead, the mind is a whirling, swirling, jumbled mass of neurons bouncing around, colliding and continuously creating new concepts and thoughts and relationships inside every single person’s brain all over the world.” 3

The central question for marketers is as follows: How do consumers respond to various marketing efforts the company might use? The starting point is the stimulus-response model of buyer behavior shown in

Figure 5.1 . This figure shows that marketing and other stimuli enter the consumer’s “black box” and produce certain responses. Marketers must figure out what is in the buyer’s black box.

Marketing stimuli consist of the four Ps: product, price, place, and promotion. Other stimuli include major forces and events in the buyer’s environment: economic, technologi- cal, political, and cultural. All these inputs enter the buyer’s black box, where they are turned into a set of buyer responses: the buyer’s brand and company relationship behavior and what he or she buys, when, where, and how often.