MAR 3211, Consumer Behavior 1

Course Learning Outcomes for Unit I Upon completion of this unit, students should be able to:

1. Discuss how the field of marketing is influenced by the actions of consumers. 1.1 Analyze how the actions of consumers impact an organization.

3. Explain how consumers interpret information about products and people.

3.1 Describe factors that will impact how consumers view and ultimately purchase products and services.

7. Explain the steps of the consumer decision-making process.

7.1 Explain the steps in the consumer decision-making process and how they relate to consumer behavior.

Course/Unit

Learning Outcomes Learning Activity

1.1

Unit Lesson PowerPoint Presentation Foxall and Sigurdsson (2013) article Article Review

3.1

Unit Lesson PowerPoint Presentation Shateri, Nayebzadeh, and Roknabadi (2016) article Article Review

7.1 Unit Lesson PowerPoint Presentation Article Review

Reading Assignment In order to access the following resources, click the links below. Click here to access the Unit I PowerPoint presentation. (Click here to access a PDF version of the presentation.) Foxall, G. R., & Sigurdsson, V. (2013). Consumer behavior analysis: Behavioral economics meets the

marketplace. The Psychological Record, 63(2), 231–238. https://libraryresources.columbiasouthern.edu/login?auth=CAS&url=http://search.ebscohost.com/logi n.aspx?direct=true&db=a9h&AN=87083913&site=ehost-live&scope=site

Shateri, F., Nayebzadeh, S., & Roknabadi, A. D. (2016). Evaluating advertisement: The role of customer's

decision-making style, innovativeness, and ideology. International Journal of Information, Business and Management, 8(4), 159–177. https://libraryresources.columbiasouthern.edu/login?auth=CAS&url=http://search.proquest.com.library resources.columbiasouthern.edu/docview/1814292332?accountid=33337

UNIT I STUDY GUIDE Introduction to Consumer Behavior and Decision-Making

MAR 3211, Consumer Behavior 2

UNIT x STUDY GUIDE Title

Unit Lesson When you think of consumer behavior, what thoughts come to your mind? Why do you think that there is a consumer behavior course included in most marketing degree programs? There are many definitions of consumer behavior, but the main concepts involve studying how people choose goods and services to fulfill any wants or needs they may experience. Consumer behavior is truly an ongoing process in which marketers attempt to understand behaviors in order to fulfill the needs of the consumer. Another focus of consumer behavior is the spending habits of consumers. There is a need for organizations to understand this behavior as it relates to consumer buying. Identifying the stages of the consumption process provides a good perspective on how organizations accomplish this, beginning with the pre-purchase stage where marketers need to understand how a consumer begins the buying process. Providing valuable information on the worthiness of the product or service might be effective during this stage. Subsequently, during the purchase stage, the marketer should look to make the experience a pleasant one. Finally, during the post-purchase stage, the consumer decides if the product or service has truly fulfilled his or her need. Think about a product that you purchased recently. Was it a pleasant experience? Did the product fulfill your needs? Would you recommend it to friends? These are all questions that the marketer is asking.

As marketers look to examine the needs of consumers, it is important to understand that the most economical and effective method for an organization to meet consumer needs is to identify a target market. The target market is the group of people on which marketers will focus their marketing efforts. You are probably wondering why marketers would not prefer to target everyone, which seemingly would reach a larger market and provide greater exposure. The simple answer is that marketing departments do not have unlimited marketing budgets. It is not financially feasible to attempt to reach everyone. A better method is to focus on a certain group of individuals who would most likely be interested in a company’s product or service. Understanding the needs and

wants of this group is paramount. The process of identifying the target market begins with segmentation. This involves dividing a broad population into subsets of consumers based on several criteria. The first criterion we will discuss is demographics, which involves looking at characteristics such as age, gender, family structure, social class/income, and race/ethnicity. Another criterion could be geographic, which speaks to the region of the country or world, region in a country, neighborhood, or even the size of the city in which the consumer lives. The psychographic criterion relates to personal values that will drive perception and motivations. Finally, the behavioral criterion utilizes the specific interests, rate of use, and brand familiarity of the consumer. Once a marketer has completed this segmentation process, he or she can better identify a detailed description of the target market.

Consumer at coffee shop (Pexels, 2016)

MAR 3211, Consumer Behavior 3

UNIT x STUDY GUIDE Title

Criteria Characteristics Example Demographic Age, gender, family structure,

social class/income, family life cycle, race/ethnicity

Identifies who the consumer is and where he or she is in life

Geographic Region of the country or world, region in a country, neighborhood, size of city the consumer resides

Location in world or country in which the consumer lives

Psychographic Personality, perceptions, values, beliefs

Reflect for weeks on a purchase or buy quickly

Behavioral Special interests, rate of use, brand familiarity

Soccer player, traveler, healthy living

Table 1.1: Segmentation criteria Involvement refers to the relevance in the consumer decision-making process. What this suggests is that the consumer’s perceived familiarity with the product, message, or situation will have an impact. Product involvement is simply the consumer’s level of interest in a particular product; in contrast, message involvement refers to the influence that media vehicles have on the consumer. Finally, situational involvement refers to whether the consumer is in a store, on a website, or at a location where the product or service is consumed. Think about the theme stores and restaurants that we frequent and how that theme encourages us to stay longer and enjoy the environment or situation. Through all of this, perceived risk is important—the greater the risk, the less likely the consumer will be to make the purchase. Perceived risk refers to any negative consequence associated with the decision. This can involve monetary risk, functional risk, physical risk, social risk, or psychological risk. As expected, the monetary risk involves a poor choice associated with the exchange of too much money. Functional risk relates to a situation when the product does not function as expected, and physical risk is one that may physically harm the consumer. Social risk involves a results that may affect the consumer’s self-esteem, confidence, or image. Finally, psychological risk reflects on the loss of self-respect with a poor buying decision. The goal of the marketer is to reduce these perceived risks as much as possible in order to encourage and influence the consumer. Employing the segmentation and target marketing concepts allows the organization to most effectively position its organization and products/services. Positioning refers to how the company would like to be perceived in the minds of the target market. It portrays a distinct image that differentiates the organization and its product or service offerings from its competitors. This is also referred to as unique selling proposition (USP), which encompasses why the consumer will purchase one product over another. The consumer decision-making process provides a model by which marketers can better understand the process that a consumer moves through as he or she makes decisions to buy or not buy a product or service. The process is complicated even more in today’s world as there are so many options for the consumer to choose. Additionally, so many factors influence the process. Look at the consumer decision-making process below.

MAR 3211, Consumer Behavior 4

UNIT x STUDY GUIDE Title

Generally, marketers apply a rational perspective in attempting to understand decision-making. This implies that marketers gather, integrate, and interpret as much information about consumers as possible. The study of the consumer decision-making process suggests that marketers are studying exactly how consumers are making decisions that lead to buying. Within this continuous attempt to understand consumer behavior, technology has played an important role. These advances seem to be arriving at a faster pace every day. Technology has played a role in consumer behavior throughout history from the advent of the telephone to the television and now to the 24/7 access to the Internet. One thing that has not changed is the marketer’s need to understand and fulfill the consumer’s value proposition. The value proposition is defined as the value perceived by the consumer—not the marketer. Through observation and the use of sophisticated tracking system technology, marketers can now view and record shoppers’ behavior and reactions to different products, displays, and situations. In any business, the consumer is the most important person in the transaction. It is logical to assume that as marketers increase their understanding of what makes the consumer tick, the better prepared they are to meet the needs of that consumer. The fields of psychology, sociology, and anthropology all play a role in this level of understanding. Consumer behavior is continuously evolving, as human beings are extremely complex beings. It is also important to remember that as consumers buy, not only the organization benefits, but also the overall health of the economy benefits.

Reference Pexels. (2016). Adult, bar, coffee machine [Photograph]. Pixabay. https://pixabay.com/en/adult-bar-coffee-

machine-1846748/

Table 1.2: Think of a recent purchase you made and how you might have proceeded through the consumer decision- making process without even realizing it. Now, think about how a marketer might use this model in putting together effective marketing strategies for an organization.

Problem recognition: This is the first step where a consumer becomes aware of the need for a new product/service.

Information search: The consumer is now actively gathering information and facts about products/services that might fulfill his or her needs.

Evaluation of alternatives: The consumer reviews and evaluates, giving it a mental try.

Product choice: The consumer makes a decision to purchase the product/service.

514

ASBBS PROCEEDINGS OF THE 23RD ANNUAL CONFERENCE

AN EXAMINATION OF THE INFLUENTIAL FACTORS OF PACKAGING,

PRICE SENSITIVITYAND BRAND IMAGE ON FROZEN FOOD CONSUMER

BUYING BEHAVIOR IN BANGKOK, THAILAND

Thiendej, Peeraput Graduate School of Business, Assumption University of Thailand

[email protected]

Chaipoopirutana, Sirion Graduate School of Business, Assumption University of Thailand

[email protected]

Abstract

Packaging has been gradually taking on an important role as a way to serve consumers by

providing information and delivering functions. The role of packaging is observed as a

strategic tool to influence consumer buying behavior. The main purpose of this research

was to identify the influences of the visual elements of packaging in terms of graphics and

size/shape and the informational elements of packaging in terms of product information

and technology, brand image, price sensitivity on consumer buying behavior of CP ready-

to-eat frozen food in Bangkok, Thailand. This study exclusively made use of survey

methods to collect the data from 399 respondents. Descriptive statistics were used in

describing parameters of the respondents and inferential statistics was used to test the

hypotheses. The results of the Multiple Regression Model have shown that the independent

variables, such as the visual elements of packaging in terms of graphics and size/shape and

the informational elements of packaging in terms of product information and technology

were significantly influenced on both brand image and consumer buying behavior. In

addition, brand image was significantly influenced on consumer buying behavior.

However, price sensitivity was not influenced on consumer buying behavior. While the

result of Simple Regression Model showed that price sensitivity had a significant influence

on brand image. Based on the results of the study, it is supposed to be beneficial to the

ready-to-eat frozen food businesses in order to improve their packaging design in terms of

graphics as well as their brand image. Packaging can make a product stand out, and can be

a silent sale man on a shelf because it is growing in a competitive market and has become

an important tool for communication with consumers.

Key words: – Consumer buying behavior, packaging, price sensitivity and brand image.

Introduction

Food packaging is likely to grow in competitive market conditions, as packages turn into a

tool for communication and branding, and there are many factors affecting the consumer buying

behavior process through food packaging, therefore the communication functions of the package,

such as the graphics of the packaging, the size and shape of the packaging, the information on the

515

ASBBS PROCEEDINGS OF THE 23RD ANNUAL CONFERENCE

package, and innovative packaging must inform and assist consumers in making their purchase

decision carefully (Ahmed et al, 2014).

Consumers are becoming more and more demanding and packaging has been gradually taking

on an important role as a way to serve consumers by providing information and delivering functions

to communicate with consumers. It is no wonder that the important role of packaging is observed

as a strategic tool to influence consumer buying behavior. Likewise, in Thailand, currently, the

lifestyle of people is being rushed. There are time constraints and the need for speed in the activities

of everyday life and they are more likely to need more convenience cookings (Silayoi and Speece,

2007). Convenience cookings could be considered as the ease of use of consumption of the food

which indicates time reducing and less effort to prepare (Luning, 2001). Consumers who need

convenience cookings, agree that ready-to-eat frozen foods are convenient (Darian, 1995).

Moreover, packaging concepts of ready-to-eat frozen food are designed more and more to fulfill

the consumers need for more convenience (Luning, 2001). Packaging concepts, such as graphics,

size/shape, information, technology definitely could give consumers more convenience (Ahmed et

al, 2014). For example, graphics on the packages, such as their color and design, trend to have an

impact on consumer buying behavior because graphics are necessary when consumers do not have

time for much consideration and decision making; therefore, graphics could draw their attention to

the product (Ahmed et al, 2014).

Moreover, according to Jinkarn and Suwannaporn (2015), the size and shape of packaging is

more likely to play an important role in consumer buying behavior because the proper size and

shape of the package could offer convenience to the consumers for storing and preparing or

grabbing and holding. In addition, information on the packaging could also have an impact on

consumer buying behavior because it can connect consumers with the product and it is very

important for the consumers to consider information on a package in order to compare quality and

value (Deliya and Parmar, 2012). Similarly, some consumers might pay more attention to the

information on the package, especially the consumers who are concerned about health (Silayoi and

Speece, 2004). In addition, consumer buying behavior is also likely to be influenced by the

technology of packaging, such as its recyclability, microwavable, easy-to-open, easy-to-store, easy-

to-carry, and preventing breakages (Silayoi and Speece, 2007). However, in this case, the consumer

buying behavior is influenced not only by the convenience of the ready-to-eat frozen food

packaging. Price and brand of the ready-to-eat frozen food could have an impact on consumer

buying behavior as well. For example, price could refer to the perceived value of goods and service,

and the different perception of the goods or service leads to a difference in identifying the price,

especially the importance of food price often has its effect on consumer’s income (Walters and

Bergiel, 1989). On the other hand, brand names could create important information and key benefits

of the product, and help consumers remember it (Parry, 2001).

Literature Review

Consumer buying behavior: Consumer buying behavior involves the selection, purchase and

consumption of goods and services in order to satisfy their needs and wants. Basically, there are

516

ASBBS PROCEEDINGS OF THE 23RD ANNUAL CONFERENCE

different processes involved in consumer buying behavior. Firstly, the consumers would try to find

what product and service they would like to consume, then they choose only those products or

services that give them greater benefits, and after selecting the product and service, the consumer

tends to make an estimate of the available money which they can spend. Lastly, the consumers tend

to identify the price of the product and make a decision (Kotler and Keller, 2011). Moreover, there

are other factors influencing buying behavior of the consumer such as social class, culture, personal

aspect and psychological factors. For example, firstly, culture is critical when it comes to

understanding the needs, wants and behaviors of an individual. Basically, culture is part of society

and the influence of culture on buying behavior varies from country to country. Therefore,

analyzing the culture of different groups is very important in terms of consumer buying behavior

(Schiffman and Kanuk, 2007). Visual elements of packaging in terms of graphics: Nancarrow et

al (1998) stated that graphics is the methodology of visual communication and a combination of

visual arts and typography. Mostly, the graphics is developed by marketers.

Basically, graphics contain image, layout, color and the total presentation of image communicated

to consumers. However, different consumers may observe different packaging in different ways

because when consumers learn graphics associations, it could lead the consumers to prefer a certain

graphic for certain product categories. In addition, according to Herrington & Capella (1995), when

consumers examine packages in the supermarket, the differential perception and the positioning of

the graphics can be the difference between identifying and missing the product because eye-

catching graphics could make the product stand out on the shelf and attract the consumers.

Therefore, graphics can affect through the colors and printed lines on the package on which

different signs and symbols are located. Moreover, in many situations graphics could create a

positive mood and also an important role of packaging graphics is that they could gain the attention

of consumers to the product (Silayoi & Speece, 2004).Visual elements of packaging in terms of

size/shape: Raghubir and Krishna (1999) conceptualized that size and shape combined with a

dimension and consumers trends to use it to make judgments about volume. Basically, consumers

could respond to different sizes and shapes in different ways because the effect of packaging size

and shape is stronger when product quality is hard to be clarified. Silayoi and Speece (2007) also

stated that different packaging sizes attract consumers from different involvement. For example,

some consumers find products in larger packaging as a good offer with great value for money and

this indicates that when the quality of the product is difficult to judge, the impact of packaging size

is greater because bigger packages of food products are more likely to be chosen. For example, if

consumers are not familiar with the brand of the product, the larger packaging size and shape could

be also noticed easily.Informational elements of packaging in terms of product information:

Coulson (2000) mentioned that one of the functions of packaging is to communicate product

information to consumers, which can help them in their purchase decisions carefully because

communication of information is one of the important functions of packaging. For example, it could

help consumers to make the right decision in the purchasing process and also provide the consumer

the opportunity to consider alternative products and make a choice by reading the information on

the package or product. Moreover, Ahmed and Salman (2005) conceptualized that in the food

industry, packaging is considered as a communication tool providing information on the product

517

ASBBS PROCEEDINGS OF THE 23RD ANNUAL CONFERENCE

about ingredients, contents, price, cooking directions and the expiry date. Basically, the objective

of the information functions of packaging is to inform consumers about the product’s contents and

help the consumers in making their decisions carefully.

Informational elements of packaging in terms of technology: Mcllveen (1994) stated that the

informational elements of packaging in terms of technology is a combination between research

development and innovation that are more effectively packaged for the product. Basically, the

development of packaging technologies is concerned with food safety, and these technologies

could be related to improving the quality, expiration date, safety, and components of the package.

Silayoi and Speece (2004) also mentioned that the technology developed for packaging comes

from consumer behaviors. For example, working people often purchase microwavable food

packaging which is convenient and suits their lifestyle; therefore, consumers are more likely to

pay attention to packaging materials which have an impact on convenience as well as the product

itself because it could help them with their food preparation. For example, microwavable

packaging could be a good solution for consumers when they do not have enough time to prepare

their meal.

Price sensitivity: Kim et al. (1999) mentioned that price is the value of purchasing goods or

services and might be involved in consumer buying behavior and price could be an important

factor for some consumers because they are more likely to feel price sensitivity when purchasing

the product at a lower or higher price. Monroe (1971) also stated that price sensitivity is an

individual difference variable describing how individual consumers show their reactions to

changes in price levels. In addition, Kanghyun and Thanh (2011) conceptualized that price

sensitivity occurs when each consumer shows their reactions to changes in price levels. Basically,

it is the awareness of the consumers to what they observe about the cost when purchasing a

particular product or service. Normally, each customer will have a certain price acceptability

range in their mind. When customers are satisfied with the products or services, they are more

likely to buy the product again.

Brand image: Keller (2008) stated that a brand may include a symbol, name, design, or

experience that help consumers identify products and services, in addition branding could also

help consumers to reduce risk by ensuring a certain level of product quality and brand image

could create values for the product in many ways, such as by helping consumers to process

information, differentiate brands, generate reasons to buy, give positive feelings, and increase the

reliability of the product. Keller and Lehman (2006) also mentioned that a good brand image

provides important benefits to the product and company. For example, a good brand image could

help the company to reduce the costs of advertising and help the company to be ahead of the

competitors in terms of recognition. Lassar et al. (1995) also mentioned that consumer confidence

could occur with a good brand image because loyalty and trust of the consumers are more likely

to be developed through a good brand image and these lead to confidence in the consumers and

the greater the confidence they have in the brand, the more likely they are willing to pay a high

price for it. Therefore, a good brand image may give buyers confidence that it performs better

than a brand which is unknown and the feeling of confidence communicated by the brand can be

an important additional benefit to the buyer.

518

ASBBS PROCEEDINGS OF THE 23RD ANNUAL CONFERENCE

Visual elements of packaging in terms of graphics, size/shape and consumer buying

behavior.

Ahmed et al. (2014) conceptualized that graphics on the package, such as color and design

play an important role in consumer buying behavior because graphics are necessary when

consumers do not have time for much consideration and the decision making process for a product.

Abdullah et al. (2013) concluded that there is a significant positive relationship between the

graphics on packaging and consumer buying behavior. Moreover, Adam and Ali (2014) stated that

consumer consumption trends increased when packages are available in larger sizes. For example,

a larger package is considered by consumers of larger families, and a smaller package for them

could be considered as a waste. Jinkarn and Suwannaporn (2015) also revealed there is a positive

relationship between the size and shape of packaging and consumer buying behavior.

Visual elements of packaging in terms of graphics, size/shape and brand image

Underwood et al. (2001) stated graphics could help consumers find the brand of their choice

and if they do not have any strong preference for a brand then graphics at least gain their attention

to consider a particular product for evaluation. Edward (2013) summarized that graphics used in

packaging have a significant relationship with brand image. According to Agariya et al.

(2013), a proper size and shape packaging can help brands in a good position in the market place

and set a brand apart from its competitors in order to get consumers’ attention easier and also can

represent an image of the brand. Orth and Malkewitz (2006) also concluded that there is a

significant positive relationship between size and shape of packaging, and brand image.

Informational elements of packaging in terms of product information, technology and brand

image.

Sial et al. (2011) stated that packaging information, such as labeling which is written on the

package or a product could contain the brand name of the product as well as the ingredients.

Moreover, a company uses packagi