Module:3 Psychological

Influences on Consumer
Decision Making -I
 Contents of Module 3
• Consumer’s Needs & Motivation,
• Personality and Consumer behaviour,
• Brand Personality,
• Self and Self-image,
• Consumer Perception,
• Risk and Imagery
 Consumer Decision Making process

Need / Problem Recognition

Information Search

Evaluation of alternatives

Purchase Decision

Postpurchase Behavior
Simple Model of Consumer Behavior
 Consumer’s Needs & Motivation
• Needs are the basic human requirements such as for air, food, water,
clothing, and shelter. Humans also have strong needs for recreation,
education, and entertainment.

• Need is a basic biological motive

• For example, while thirst is biologically based, we are taught to want

Coca-Cola to satisfy that thirst rather than, say, goat’s milk
 CLASSIFYING • Maslow’s
CONSUMER NEEDS hierarchy of
needs
Self-actualisation –
e.g. becoming the
very best you can be
Types of Needs
Stated need- The customer wants an inexpensive car.
Real need- The customer wants a car whose
operating cost, not initial price, is low.
Unstated need- The customer expects good service
from the dealer.
Delight need- The customer would like the dealer to
include an onboard GPS navigation system.
Secret need - The customer wants friends to see him
or her as a savvy consumer.
 HIDDEN MOTIVES: THE PSYCHOANALYTICAL THEORY

• The id is entirely oriented towards immediate gratification – it is the

‘party animal’ of the mind. It operates according to the pleasure
principle: behaviour is guided by the primary desire to maximize
pleasure and avoid pain. The id is selfish and illogical. It directs a
person’s psychic energy towards pleasurable acts without regard for
the consequences.

• The superego is the counterweight to the id. This system is essentially

the person’s conscience. It internalizes society’s rules (especially as
communicated by parents) and works to prevent the id from seeking
selfish gratification.

• Finally, the ego is the system that mediates between the id and the
superego. It is in a way a referee in the fight between temptation and
virtue. It finds ways to gratify the id that will be acceptable to the
outside world. These conflicts occur on an unconscious level, so the
person is not necessarily aware of the underlying reasons for his or
her behaviour.
HIDDEN MOTIVES: THE PSYCHOANALYTICAL THEORY
 Consumer’s Needs & Motivation
• From a psychological perspective motivation occurs when a need is aroused that
the consumer wishes to satisfy. Need Arousal

• Once a need has been activated, a state of tension exists that drives the consumer
to attempt to reduce or eliminate the need.
State of Tension
D
• This need may be utilitarian (a desire to achieve some functional or practical R
benefit, as when a person eats green vegetables for nutritional reasons) or it may I
be hedonic (an experiential need, involving emotional responses or fantasies, as V
Quest for Functional E
when Jez thinks longingly about a juicy steak).
or Emotional
Fulfilment
• The desired end-state is the consumer’s goal.

• This degree of arousal is called a drive. Goal

 Drive theory
• Drive theory focuses on biological needs that produce unpleasant states of
arousal (e.g. your stomach grumbles during the first lecture of the day – you
missed breakfast).

• We are motivated to reduce the unpleasant state / tension caused by this arousal.

• This state activates goal-oriented behaviour, which attempts to reduce or

eliminate this unpleasant state and return to a balanced one called homeostasis
A typology of motivators in tourism
 • Product Levels: The
Customer-Value Hierarchy

Motivational/
Need based
Research
Relating Motivation & Buying Behaviour

A= Ability = Paying capacity

O= Opportunity = Availability in the nearby stores, Offers on sale

M= Motivation = Need & Desire

Personality and Consumer
behaviour
 Why Personality Matters
• Personality can be a useful variable in analyzing consumer brand
choices.
• Brands also have personalities, and consumers are likely to choose
brands whose personalities match their own.
 Why Personality Matters (Cont.)
• Personality is a useful consumer behaviour concept because it
enables us to classify people into different groups on the basis of a
single trait or a few traits.
 Personality- Introduction
Personality is person-ality, the science of describing and understanding persons.

“Personality is the dynamic organisation within the individual of those psychological

systems that determine his unique adjustment to environment.”

Adams suggested that we get a good idea of what personality is by listening to what we
say when we use “I”.

Some people are anxious, some are risk-taking; some are phlegmatic, some highly-strung;
some are confident, some shy; and some are quiet and some are loquacious.

This issue of differences is fundamental to the study of personality.

Examples of Personality
Competitive
Rational
emotional
Introvert
extrovert
Workaholic
Compulsiveness
Self confidence
Friendliness
Adaptability
Ambitiousness
Dogmatism
Authoritarianism
Aggressiveness
Competitiveness
 Three distinct properties of personality

a) Personality reflects individual differences:

• Personality is used to account for differences between individuals rather than the similarity.

b) Personality is consistent and enduring:

• Personality is generally believed to be consistent and enduring over time and tends to carry to a
variety of situations.

c) Personality can change:

• Despite the fact that personality tends to be consistent and enduring, it may change due to major
life events such as marriage, birth, death in family, changes in economic circumstances and the
process of ageing
 Theories of Personality

a) Freudian theory.

b) Neo-Freudian personality theory.

c) Trait theory.
 a) Freudian theory

Sigmund Freud’s psychoanalytic theory

was built on the principle that
unconscious needs or drives are at the
heart of human motivation and
personality.

This theory proposes that every

individual’s personality is the result of
childhood conflicts. These conflicts are
derived from three fundamental
components of personality: Id, Ego and
Superego.
 PERSONALITY: THE PSYCHOANALYTICAL THEORY

• The id is entirely oriented towards immediate gratification – it is the

‘party animal’ of the mind. It operates according to the pleasure
principle: behaviour is guided by the primary desire to maximize
pleasure and avoid pain. The id is selfish and illogical. It directs a
person’s psychic energy towards pleasurable acts without regard for
the consequences.

• The superego is the counterweight to the id. This system is essentially

the person’s conscience. It internalizes society’s rules (especially as
communicated by parents) and works to prevent the id from seeking
selfish gratification.

• Finally, the ego is the system that mediates between the id and the
superego. It is in a way a referee in the fight between temptation and
virtue. It finds ways to gratify the id that will be acceptable to the
outside world. These conflicts occur on an unconscious level, so the
person is not necessarily aware of the underlying reasons for his or
her behaviour.
 b) Neo-Freudian personality theory.
• There were a group of psychologists who believed that social
interaction and resultant relationships formed the basis for the
growth and development of personality. Here, they disagreed
with their contemporary, Freud, who believed that personality
was −

• Biological and rooted in genetics, and

• Was groomed as a result of early childhood experiences. This group of

researchers who laid emphasis on the process of socialization came to
be known as the Neo. To form a personality, social relationships are
very important.
 b) Neo-Freudian personality theory.
• Based on this, consumers are classified into three personality types −

Compliant Personalities are those who move toward others—they

desire to be loved, wanted, and appreciated.

Aggressive Personalities move against others—they desire to excel

and win admiration.

Detached Personalities move away from others—they desire

independence, self-sufficiency, and freedom from obligations.
 c) Trait theory.
• Traits are the features of an individual or
Following are the few of
tendency of an individual in a particular the most common traits −
manner.
Outgoing
Sad
• Traits help in defining the behavior of Stable
Serious
consumers. Happy go lucky
Relaxed
Self assured
• According to the Trait theorists, an individual’s Practical
personality make-up stems out of the traits Imaginative
that he possesses, and the identification of
traits is important.
 c) Trait theory.
• The trait theories can be of two broad categories, viz., Simple trait
theories and general trait theories.

• Simple Trait Theories

• In simple trait theories, a limited number of traits are identified, and people
are categorized and classified on the basis of these traits.

• General Trait Theories

• In general trait theories, a large variety of traits are identified
 Trait Theory & Personality
Kindness
Thoughtfulness
kindness Family Person
carefree Carefree
successful spirited
elegant youthful
rough
thoughtfulness
spirited
Rough
accomplished
Tough
prestigious Outdoorsy
tough Athletic
Family Person
youthful
influential
pretentious
outdoorsy Successful
athletic Accomplished
Influential
Brand Personality, Self and
Self-image
 Self and Self-concept
• Self-concept is defined as "the sum of the individual's thoughts and
feelings having reference to himself as an object," (Rosenberg 1979)

• Self- concept is the image an individual holds about himself.

• Self-Image or perceptions of self is very closely associated with

personality.

• Self-concept defends self-esteem. When a product supports a consumer’s

self-concept, she feels understood and validated, and that she has gained
some control over her emotions by buying the product.
Types of Self-Concept
 Brand personification
• Brand personification is recasting of consumers’ self image on a perception of a product
or a service.

• It is casting of human-like character on/in a brand.

• Brand Personification can help in setting the Brand positioning strategy.

• Individuals tend to buy products and services and patronize retailers whose image or
personalities relate in some meaningful way to their own self-images.

• People buy products and brands because it allows them to say something positive about
themselves - because they use that product or brand.
 Brand personality

• Brand personality is a set of human characteristics that are attributed to

a brand name. A brand personality is something to which the consumer can
relate.
 Brand personality
There are five main types of brand personalities with common traits:

• Sincerity: kindness, thoughtfulness, and an orientation toward family values. Eg:- Tata

motors.

• Excitement: carefree, spirited, and youthful. Eg:- Renault, Mountain Dew

• Competence: successful, accomplished and influential, highlighted by leadership. Eg:-

TESLA, IBM, Microsoft

• Sophistication: elegant, prestigious, and sometimes even pretentious. eg:- Mercedes,

Apple.

• Ruggedness: rough, tough, outdoorsy, and athletic. Eg:- JEEP, Mahindra Scorpio etc.
Brand Personality
 Self-image/ Product-image congruity
model

• According to the self-image/product-image congruity model, a

consumer's specific value-laden self-image belief interacts with a
corresponding value-laden product-image perception in terms of the
typical user image in a product purchase.
Collecting Data on Personality - Example
Self-image/ Product-image congruity
model
Self – Image & Customer satisfaction

Quality/
Value/
Performanc
e
Satisfactio
n

Self-image/
Product-
image
congruity
 Extra Reading
• Quester, P. G., Karunaratna
, A., & Goh, L. K. (2000). Self‐congruity and product evaluation:
a cross‐cultural study. 
Journal of Consumer Marketing.
Consumer Perception
 Consumer Perception
• The term “perception” can be defined as the ability to derive meaning.

• Schiffman defines it as “the process by which an individual selects, organizes, and interprets
stimuli into a meaningful and coherent picture of the world.”

• There is a difference between perception and sensation. Perception is much broader in scope. It is
complex process by which a person organizes facts around the stimuli and gives meaning to it.

• While perception starts with sensation, it ends up when meaning is given to the stimuli, through
cognitive processes.

• During this process of selection, organization and interpretation, the human being is assisted by
the memory bank or the information that is stored in his long term memory.
 Perception Mechanism

• A person is caught by a new packaging of a familiar brand, he picks up

other stimuli on the package through his senses
Selection

• He organizes other facts from internal (memory), external

sources (dealer, packaging) and his belief system.
Organization

• conclude that the package is new

interpretatio but the brand is old and familiar.
n
 Role of factors in Perception
• The selection, organization and interpretation by the human mind is done on the
basis of

• i) characteristics of the perceiver, and

• ii) characteristics of the situation.

• The characteristics of the perceiver include learning and experiences, knowledge

and beliefs, motivation, need and involvement, attitude, personality, social class,
culture etc.
 Overall Perception Process
• People perceive things differently because of their characteristics and backgrounds, and because of the
different perceptual mechanisms that take place.

Perceptual
Input Output Behaviour
Mechanism
Consumer Imagery
 Consumer Imagery
• Marketers segments, targets consumers, positions the brand and
implements the marketing mix.

• And, in the process, the Consumers formulates the images of the

marketing stimuli that they are faced with; this is referred to as
imagery.
 Channel
Partners Employees
(Place)
Service
Pricing
Process

Brand
Physical
Attributes &
Evidence
Quality

Brand
Corporate
positioning
Brand Image
strategy

Target Promotions
Consumer
markets (Communica
Imagery
belief system tions)
PERCEIVED RISK
 PERCEIVED RISK
• Whenever a consumers is in the purchase decision making process and
comes across a situation such as lack of information, newness of the
product/service offering, complexity of the offering, high price, etc, he/
she experiences a state of uncertainty anxiety, uneasiness and tension
when he fails to predict the consequences of product choice, usage and
resultant experience. This feeling arises is refereed to as consumer
perceived risk
 Types of Perceived Risk:

Functional Risk Physical Risk Financial Risk:

• Consumers are uncertain about • It refers to the dangers that the • Consumer doubts as to
the product’s attributes, product usage could bring with whether the product is worth
features and overall benefit itself or safety of the family its cost? Perceived Value.

• Is the microwave at Rs. 20000,

• Will the microwave oven • Will consumption of food worth its cost (keeping in mind
function well once I take it cooked in a microwave lead to the benefits)? Will it serve me
home? cancer? Harmful radiation for 5 years?
 Types of Perceived Risk:
Social Risk Psychological Risk Time Risk

• Consumer doubts the product • Consumer fears loss of self- • Consumer is uncertain and
purchase and usage will lead to esteem or self-image as a result doubts whether his time has
sanctions or approval by the of poor choice or loss of self been wasted by making a
social group or class to which satisfaction. wrong choice or that he would
he belongs/ embarrassment. have to spend time again if the
product does not perform as
expected/ Opurtunity cost
• Will my old mother approve of • Will my decision to purchase
such a product and at this high the Brand make me feel stupid/ • Will the microwave oven
price (would she consider it discontent/ self-dissatisfaction function well or would I have to
worthy)? Is the microwave replace it soon?
appealing enough not to cause
ridicule?
 Degree of perceived risk
• The degree of perceived risk varies with

• the amount of money at stake,

• the amount of attribute uncertainty,
• the kind of channels of selling (i.e. direct or indirect
marketing)
• the amount of time available for shopping.
• the level of consumer self-confidence.
 Strategies to Reduce Risk
Create Brand awareness

Strong Brand Image - Share brand performance reports with consumers/ trusted and well-known brand.

Build a Brand loyalty through Relationship marketing

Set the right price- A high price is seen as an indicator of good quality

Affiliations/ certifications/ Recommendations, Food Safety and Standards Authority of India (Fssai), Medical
council of India (MCI), International standardization organization (ISO), Indian Standards Institution (ISI) etc

Provide warranties & guarantees

Further, marketers must understand the factors that provoke a feeling of risk in consumers and provide information and
support to reduce it