CONSUMER BEHAVIOR

POLITEKNIK KOTA BHARU
DIPLOMA IN MARKETING

DPM40083
CONSUMER BEHAVIOR

First Edition

Norbaini Binti Ghazali
Salwuan Binti Ab Halim
Yusnida Binti Mohd Pauzi

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Published and printed by:
Department of Commerce
Politeknik Kota Bharu
KM24 Kok Lanas, 16450 Ketereh
Kelantan.
www.pkb.edu.my

Consumer Behavior
First Edition 2022
© 2022 Norbaini Ghazali, Salwuan Ab Halim and Yusnida Mohd Pauzi

All right reserved. No part of this material may be reproduced or transmitted in any form by
any means, electronic or mechanical, for any purpose, without the written permission from
Politeknik Kota Bharu.

Norbaini, Salwuan &Yusnida
Consumer Behavior/ Norbaini, Salwuan &Yusnida

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SYNOPSIS

The objective of this book is to provide source of information and knowledge especially for
students who enrolled for Diploma in Marketing or any students who may require referring for
any topic relevant to them.
This book entirely based on the Polytechnic MOHE syllabus for Diploma in Marketing.
Consumer Behavior is social psychology applied to consumption situations. This situation
includes buying, selling, using, and disposing of consumer goods and services. At the end of the
course, students should possess a working knowledge of attitude, perception, consumer’s
decision-making process and external factors that influence consumer behavior.
We welcome any constructive suggestions and comments from lecturers and students. Such
feedback is given careful consideration and very helpful for future improvement.

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ABOUT THE AUTHORS

NORBAINI BINTI GHAZALI
BBA (HONS) MARKETING,
UITM CAWANGAN MACHANG,

KELANTAN

SALWUAN BINTI AB HALIM
MBA (UKM) BANGI SELANGOR
BBA (HONS) UUM, SINTOK, KEDAH

YUSNIDA BINTI MOHD PAUZI
BBA (HONS) MARKETING,

UITM CAWANGAN BANDARAYA
MELAKA

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TABLE OF CONTENT

SYNOPSIS iii
ABOUT THE AUTHORS iv
TABLE OF CONTENT v
LIST OF FIGURE vi
1.0 Introduction of Consumer Behavior 1
1
1.1 Understand consumer behavior 1
1.1.1 Define consumer behavior 1
1.1.2 Interdisciplinary study of consumer behavior 3
5
1.2 Factors that influence the growth of consumer behavior 5
1.3 Consumer behavior application 8
9
1.3.1 Consumer behavior application in marketing 10
EXERCISE 10
ANSWER 10
2.0 Consumer Decision Making Process 11
2.1 Concept of consumer decision making 12
14
2.1.1 Define consumer decision making 14
2.1.2 Purchase and purchasing roles 16
2.1.3 Model of consumer decision making process 18
2.2 Analyzed consumers’ acceptance of new products and services 21
2.2.1 Definition of Diffusion 24
2.2.2 New product characteristics that influence consumer acceptance 25
2.2.3 Explain stages in the adoption process
2.2.4 Types of adopters 27
EXERCISE
ANSWER

REFERENCES

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LIST OF FIGURE

Figure 1.1: Interdisciplinary Study of Consumer Behavior….…………………………………… 1
Figure 1.2: Factors Influence the Growth Of Consumer Behavior……………………………….. 3
Figure 2.1: Model of buyer behaviour………………………………………………………………… 11

Figure 2.2: Roles in The Decision-Making Process………………………………………………… 11
Figure 2.3: Model of Consumer Decision Making Process………………………………………… 12

Figure 2.4: Four basic elements of the diffusion process………………………………………….. 15

Figure 2.5: New product characteristics that influence consumer acceptance…………………. 16

Figure 2.6: Stages in the adoption process 18

Figure 27: Types of adopter 21

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TOPIC 1: INTRODUCTION OF CONSUMER BEHAVIOUR

1.1 UNDERSTAND CONSUMER BEHAVIOUR

1.1.1 Define consumer behaviour
Consumer behaviour is characterised as the actions that people take when they are looking for
(products, brands, prices, and store locations), buying (deciding to buy the product), using (using the
product for their own consumption), assessing (the level of satisfaction), and discarding (stop using)
goods and services that they anticipate will meet their needs.

(American Marketing Association)

1.1.2 Interdisciplinary Study of Consumer Behaviour

There are various factors or disciplines which affects consumer behaviour. These interdisciplinary
dimensions can change Consumer Behaviour and their buying decisions.

Figure 1.1 Interdisciplinary Study of Consumer Behaviour

a) Psychology
o The study of human and animal behaviour.
o Usually centers on the individual.
o The study of the behavior and mental processes (thoughts, beliefs, difficulties, feelings),
and individual.
o This study was to identify individual differences (intelligence, attitude, personality) and the
motivations, decision making & perception).
o This study may help explain the different actions by different individual in similar situations.

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b) Sociology
o The study of collective behavior of people in groups.

o To generally explain the behaviour of consumers, it is impossible not to emphasize the

importance of sociological determinants in consumer behaviour, because sociology as a

science deal with the study of society and the behaviour of people as representatives of

different groups.

o According to societies, people as consumers are also stimulated by the influence of the group,

they are part of.
o In sociological explanations of the process of meeting the needs of consumers, the human is

observed as a social being, whose behaviour affects the environment in which one lives and

works.
o The consumer is part of the society and meets one’s personal and social needs in the social

environment system where participates. The system of values within the society itself is

human-oriented and its formation as a social being, which during this period will not lose its

individual characteristics.

o According to sociologist David Reisman. People and society can be classified into three

groups:

1) Tradition directed
➢ describing or relating to individuals whose values, goals, and behaviour are largely
determined by their traditional cultural heritage, that is, by the social norms
transmitted by their parents.

2) Inner directed
➢ describing or relating to an individual who is self-motivated and not easily influenced
by the opinions, values, or pressures of other people

3) Other directed
➢ describing or relating to people whose values, goals, and behaviour stem primarily
from identification with group or collective standards rather than with individually
defined standards. Also called outer directed.

c) Anthropology
o Study of people in relation to their culture.
o Traditionally centered on the study of communities and societies – considerable emphasis on
primitive and societies.

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d) Economy
o Studies on the use, production and exchange of goods and services, or in other words
o study of how consumers spend their money, to assess their options and how consumers make
decisions to maximize customer satisfaction.
o Consumer decision-making and decisions are "rational" and merely consider the economic
aspects.
o Economic theory assumes the user has a system of limited resources but unlimited needs and
desire. therefore, consumers will make decisions in various situations.

1.2 FACTORS THAT INFLUENCE THE GROWTH OF CONSUMER BEHAVIOUR

1.1 Factors Influence the Growth Of Consumer Behavior

a) Short Product Life Cycle
o Innovation is replaced by brand-new or substitute products
o Habits, habits, buying patterns, people's shifting tastes, competition, a plethora of new, high-
quality products on the market, changes in consumer opinion, a lack of promotion, occasionally
changing technological advances, and shifts in cultural values.
o This connection led the field of consumer behavior will evolve from time to time.
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b) Environmental Protection

o Public awareness about the need for a safe environment to grow due to: -
• Reduced resources.
• Increasing environmental destruction.
• Population growth (population explosion).
• The development of "affluent society“
• Development of disposable goods.

o Example: Malaysia-contaminated water can be recycled, eg SYABAS
o Example: Timber endangered - so we recycle paper / products used to safeguard the environment

c) Consumer Protection

o Users should be aware of the need to protect against them when the user is aware of the need
for protection. (Users will choose the best and quality products to consumers' rights are
protected).

o Awareness of the need for consumer protection causes understanding of consumer decision-
making process.

o Consumer-perception and interpretation of marketing information.

d) Public Policies

o Policy clouds are usually carried out by the Government.
o The government is more aware of their responsibilities in protecting consumers.
o With the public policy of this, it helped a lot in need daily users, resulting in changes in the

economy and the impact on consumers.
o Implications:

✓ The government and public organizations and private sponsors research and different
types of user activity

✓ Advertising effects on consumer.

e) The Growth of International Marketing
o Efforts to develop the market across the border into the country overseas marketing and
development of a "global" resulting from:
✓ Government incentives to offset the income inequality.
✓ Local markets are becoming saturated.
✓ Problem of differences in tastes, cultures, needs and buying patterns and use of
foreign consumers led marketers to understand them in different ways.
4

f) The Growth of Non- Profit Marketing

o How services cause marketing development non-profit organizations such as schools, hospitals,
museums, public bodies, and other people who need support to grow, realize how important it is to
use a marketing strategy that is received by the public of their activities.

g) The Growth of Computer Software and Statistics

o The development of "microcomputers" and the techniques of advanced analysis encourage the
development of the user with:

o Enable the collection and storage of a complete data on demographic characteristics, attitudes,
activities, etc.

o Detailed analysis allows marketers to form a market more homogenous.

1.3 CONSUMER BEHAVIOUR APPLICATION

1.3.1 Consumer Behaviour Application in Marketing

a) Market segmentation

o Customer segmentation and identifying types of buyers have always been important. Now that
personalization and customer experience are factors that determine a business’ success, effective
segmentation is even more important.

o Traditionally, most marketers use six primary types of behavioural segmentation.

i) Benefits sought

✓ A customer who buys toothpaste can look for four different reasons: whitening,
sensitive teeth, flavor, or price.

✓ When customers research a product or service, their behavior can reveal valuable
insights into which benefits, features, values, use cases, or problems are the
most motivating factors influencing their purchase decision.

✓ When a customer places a much higher value on one or more benefits over the
others, these primary benefits sought are the defining motivating factors driving
the purchase decision for that customer.

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ii) Occasion or timing-based
✓ Occasion and timing-based behavioural segments refer to both universal and

personal occasions.
✓ Universal occasions apply to most customers or target audience. For example,

holidays and seasonal events when consumers are more likely to make certain
purchases.
✓ Recurring-personal occasions are purchasing patterns for an individual customer
that consistently repeat over a while. For example, birthdays, anniversaries or
vacations, monthly purchases, or even daily rituals such as stopping for a cup of
coffee on the way to work every morning.
✓ Rare-personal occasions are also related to individual customers, but are more
irregular and spontaneous, and thus more difficult to predict. For example,
attending a friend’s wedding.

iii) Usage rate
✓ Product or service usage is another common way to segment customers by

behavior, based on the frequency at which a customer purchases from or interacts
with a product or service. Usage behavior can be a strong predictive indicator
of loyalty or churn and, therefore, lifetime value.

iv) Brand loyalty status
✓ Loyal customers are a business’s most valuable assets. They are cheaper to retain,

usually have the highest lifetime value, and can become brand advocates.
✓ By analyzing behavioral data, customers can be segmented by their level of

loyalty so marketers can understand their needs and make sure they are satisfying

them.
✓ Loyal customers are the ones who should receive special treatment and privileges

such as exclusive rewards programs to nurture and strengthen the customer

relationship and incentivize continued future business.

v) User status
✓ There are many different possible user statuses you might have depending on your

business. A few examples are:
• Non-users
• Prospects
• First-time buyers
• Regular users

✓ Defectors (ex-customers who have switched to a competitor).
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b) Marketing plan
o Marketing is the entire process of researching customer needs and preferences, developing product
and service solutions to match, and promoting the benefits to targeted customers.
o Understanding basic buyer behaviour and the steps consumers follow in making purchase
decisions helps significantly in developing effective marketing plans.
o Once unsatisfied needs and wants are identified, the marketer must determine the right mix of
product, price, distribution, and promotion. -consumer behaviour study is very helpful in finding
answers to too many perplexing questions. The factors of marketing mix decisions are:
i) product - what you want customers to buy
ii) price - value customers perceive in combination with your product benefits
iii) promotion - the use of various communication tools to attract targeted customers and
generate buying activity.
iv) distribution- how you get goods to them.

c) De’marketing

o It has become increasingly clear that consumers are entering an era of scarcity in terms of some
natural gas and water. These scarcities have led to promotions stressing conservation rather than
consumption.

o In other circumstances, consumers have been encouraged to decrease or stop their use of goods
believed to have harmful effects.

o Programs designed to reduce drug abuse, gambling, and similar types of conception examples.
These actions have been undertaken by government agencies non-profit organizations, and other
private groups.

o The term “demarketing” refers to all such efforts to encourage consumers to reduce their
consumption of a particular product or service.

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EXERCISE

1.Consumer behavior is defined as the behavior that consumers display in _________for, _________,
__________, _________ and _________ of products and services that they expect will satisfy their
____________.

needs dispose searching evaluating purchasing using

2. Analyze the behavioural science based on the description given:
No Behavioural Description

Science
1 The study of the behavior and mental processes (thoughts, beliefs,

difficulties, feelings), and individual.
2 Study of how consumers spend their money, to assess their options and

how consumers make decisions to maximize customer satisfaction.
3 The study of collective behavior of people in groups.
4 Traditionally centered on the study of communities and societies –

considerable emphasis on primitive and societies.

3. Identify (TRUE/FALSE) for the factors that influence the growth of consumer behaviour.

a) Users should be aware of the need to protect against them, when the user is aware of the need for
protection. (Users will choose the best and quality products to consumers' rights are protected).

Answer: _______________

b) The government is more aware of their responsibilities in protecting the marketers/sellers.
Answer: _______________

c) Enable the collection and storage of a complete data on demographic characteristics, attitudes,
activities, etc.

Answer: _______________

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ANSWERS

1. Consumer behavior is defined as the behavior that consumers display in searching for,
purchasing, evaluating, using, and dispose of products and services that they expect will satisfy
their needs.

2. Analyze the behavioural science based on the description given:

No Behavioural Description

Science

1 Psychology The study of the behavior and mental processes (thoughts, beliefs,

difficulties, feelings), and individual.

2 Economic Study of how consumers spend their money, to assess their options and

how consumers make decisions to maximize customer satisfaction.

3 Sociology The study of collective behavior of people in groups.

4 Antropology Traditionally centered on the study of communities and societies –

considerable emphasis on primitive and societies.

3. Identify (TRUE/FALSE) for the factors that influence the growth of consumer behaviour.

a) Users should be aware of the need to protect against them when the user is aware of the need for
protection. (Users will choose the best and quality products to consumers' rights are protected).
Answer: TRUE

b) The government is more aware of their responsibilities in protecting the marketers/sellers.
Answer: FALSE

c) Enable the collection and storage of a complete data on demographic characteristics, attitudes,
activities, etc.
Answer: TRUE

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TOPIC 2: CONSUMER DECISION MAKING PROCESS
2.0 INTRODUCTION
Marketing managers should understand buyer behaviour because it describes the processes the consumer use
to make purchase decisions, as well as the use and disposal of the purchased goods or services. It is not always
obvious why people respond in the ways they do to the products that are available to them, and how they make
the choices they are confronted with. They need to study buyer behaviour is for the marketers to find out how
people make their buying decisions and to identify the factors that influence those decisions.
2.1 CONCEPT OF CONSUMER DECISION MAKING PROCESS
2.1.1 Define Consumer Decision Making
What is a decision?

o The selection of an option from two or more alternatives choices.
o In other words, for a person to make a decision, a choice of alternative must be available.
o For example, when a person has a choice between making a purchase and not making a purchase, a

choice between brand X and brand Y, OR a choice of spending time doing A or B, that person is able
to make a decision.
Hobson’s Choice
o If the consumer has no alternative from which to choose and is literally forced to make a particular
purchase or take a particular action.
o This single “no-choice” instance does not constitute a decision, such as no-choice decision

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Marketing and Buyer’s Black Box Buyer Responses
Other Stimuli Buyer Characteristics Product Choice
Marketing Buyer Decision Process Brand Choice
Product Dealer Choice
Price Purchase Timing
Place Purchase Amount
Promotion
Other
Economic
Technological
Political
Cultural

Figure 2.1 Model of buyer behaviour
2.1.2 Purchase and Purchasing Roles

Figure 2.2 Roles in The Decision-Making Process
e) Initiator

o Those who bring up the idea
o Example; reminds friends about their vacation

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f) Influencer
o Who provide information to other members about a product or service
o Roles: influences the alternatives, evaluate the final choice and convinces other members of the
family of her choice.

g) Deciders
o Who have the power to determine unilaterally or jointly whether to shop for, purchase, use,
consume, or dispose of a specific product or service.
o makes final decision occurred

h) Buyers
o Who make the actual purchase of a particular product or service
o the one that makes the purchase

i) Users
o Those who use or consume a particular product or service.

2.1.3 Model of Consumer Decision Making Process

Figure 2.3 Model of Consumer Decision Making Process

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a) Recognition of Need
o The first and most important stage of the buying process, because every sale begins when a
customer becomes aware that they have a need for a product or service.
o The need recognition stage of the consumer decision making process starts when a consumer
realizes a need. Needs come about because of two reasons:
i. Internal stimuli, normally a physiological or emotional needs, such as hunger, thirst,
sickness, sleepiness, sadness, jealousy, etc.
ii. External stimuli, like an advertisement, the smell of yummy food, etc.
o For example: Why does someone start looking for a new handphone? Likely, their old handphone
isn’t working well anymore, or they simple want a nicer handphone.

b) Information Search
o As soon as a consumer recognizes a need and begins to search for an answer, and where do
consumers generally go to look for answers today? Google!
o During this stage, customers want to find out their options.
o For example: Now that the customer has realized a need to get a new handphone, it’s time to find
solutions to his problem. In this stage, it’s imperative that it is visible to the consumer searching
for an answer.
o Here are some things a consumer may be searching for:
• Best handphone in 2020
• What is the best affordable handphone?
• Which handphone are top-rated?

c) Evaluation of alternatives

o Now that the consumer has done research, it’s time to evaluate their choices and see if there are

any promising alternatives. During this phase, shoppers are aware of your brand and have been

brought to your site to consider whether to purchase from you or a competitor.

o Consumers make purchase decisions based on which available options best match their needs, and

to minimize the risk of investing poorly, they will make sure there are no better options for them.

o Their evaluation is influenced by two major characteristics:

i. Objective: Features, functionality, price, ease of use

ii. Subjective: Feelings about a brand (based on previous experience or input from past

customers)

o For example: Consumers will first weigh the objective characteristics of the handphone. Does it

have all the features I want? Is it easy to use? Is it in my budget? Then, the subjective

consideration will kick in: Do other people think it has all the features it should? Has anyone else

who bought it expressed any difficulty with learning how to use it? Is it generally considered a

good value for the money? 13

d) Purchasing Decision
o This is the stage when customers are ready to buy, have decided where and what they want to buy,
and are ready to pull out their credit cards.
o During this stage, buying behaviour turns into action – it’s time for the consumer to buy.
o For example: Let’s say your potential customer has gotten to the checkout stage of his purchase,
and has second thoughts: What if the recipient wants a different handphone? What if this
handphone is missing a key feature that the recipient would want? How difficult will it be for the
recipient to return the handphone if it doesn’t meet their needs?

e) Post Purchase Evaluation
o After making a purchase, consumers consider whether it was worth it, whether they will
recommend the product/service/brand to others, whether they would buy again, and what feedback
they would give.
o For example: In the handphone example, the customer has already bought from your brand and
they’re evaluating their purchase. This is usually when they will leave a review about their
experience. This is also when they are at their most engaged with your brand, and they can be
susceptible to strategies that encourage long term engagement.

2.2 ANALYZE CONSUMER’S ACCEPTANCE OF NEW PRODUCTS AND SERVICES

2.2.1 Definition of diffusion
o It is a process by which the acceptance of an innovation (a new product, new service, new idea or
new practice) is spread by communication (mass media, salesperson or informal conversations) to
members of a social system (a target market) over a period of time.
o A major issue in marketing and consumer behavior is the acceptance of new products and
services. The framework for exploring consumer acceptance of new products is drawn from the
area of research known as the diffusion of innovations.
o Consumer researchers who specialize in the diffusion of innovations are primarily interested in
understanding two (2) closely related processes:
i) The diffusion process, and
ii) The adoption process.
o The definition includes the four (4) basic elements of the diffusion process:

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Figure 2.4 Four basic elements of the diffusion process:

d) The Innovation
o No universally accepted definition of the terms product or service innovation or new product
exists.
o Instead, there have been various approaches taken to define a new product or a new service; these
can be classified as firm-,product-, market -, and consumer-oriented definitions of innovations.

e) The Channel of Communication
o How quickly an innovation spreads through a market depends on communications between the
marketer and consumers, as well as communication among consumers (word-of-mouth)
o Influence of impersonal sources (advertising and editorial matter)
o Interpersonal sources

f) The Social System
o The diffusion of a new product usually takes place in a social setting frequently referred to as
social system.
o A social system is a physical, social, or cultural environment to which people belong to and within
which they function..e.g A new special diet product
o The social system might include all residents of a geriatric community.
o The social system serves as a boundary within which the diffusion of a new product is examined.
o The orientation of a social system, with its own special values or norms, is likely to influence the
acceptance or rejection of new products.
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g) Time
o Time is the backbone of the diffusion process.
o It pervades the study of diffusion in three distinct but interrelated ways:
i. the amount of purchase time,
ii. the identification of adopter categories, and
iii. the rate of adoption.

2.2.2 New Product Characteristics that Influence Consumer Acceptance
o There are five product characteristics that influence consumer acceptance of new products:

Figure 2.5 New product characteristics that influence consumer acceptance
a) Relative Advantage
o The degree to which potential customers perceive a new product as superior to existing

substitutes.
o When consumer sees a certain attribute of a new product or service to be better than the

attributes of similar existing products or services.
o Relative advantage is important because a new product is rarely without alternative, whether it

is using digital cameras rather than analogue ones or watching video on demand rather than
renting DVDs from a DVD shop.

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b) Compatibility
o The degree to which potential customers feel a new product is consistent with their present

needs, values, and practices.
o Example: Gillette MACH3 Turbo over disposable razors, digital alarm clocks over analog

alarm clocks.
o Compatibility measures whether the innovation is consistent with the set of norms, values and

other cultural aspects or religious beliefs that predominate in the population.
o This also includes naming issues: a product wearing the wrong name or the wrong colours in a

society that associate special meanings to these attributes has a low level of compatibility.

c) Complexity
o The degree to which a new product is difficult to understand or use.
o it is the level to which an innovation is seen as being complex to use in practice, maybe

because its user interface is not intuitive, or it requires too many successive steps to be applied,
like swallowing pills every hour ten times a day.
o Example: Products low in complexity include hot and cold cereals, disposable razors, and soap.

d) Trialibility
o Trialability is the degree to which an innovation may be experimented with on a limited basis.

It lowers barriers to entry for customers, especially the late majority.
o Trialability can help convince those who are risk averse and would delay their usage of the

technology because they are not sure whether it will satisfy their requirements or be superior to
the previous practice.
o For instance, many telecom service providers provide new services for free in an initial launch
phase, for example unlimited mobile TV access, to encourage their subscribers to use the
service.

e) Observability
o Finally, innovations that have a lower degree of observability will spread more slowly than

others, because observable innovations advertise for themselves.
o These could be innovations used in the home only rather than outside, or innovations that have

been allocated more limited shelf space that other products.

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2.2.3 Explain Stages In The Adoption Process
o Consumers go through 5 stages in the process of adopting a new product.

Figure 2.6 Stages in the adoption process

o These stages imply that the new-product marketer should consider how to help consumers move
through these stages. A manufacturer of large-screen televisions may discover that many consumers in
the interest stage do not move to the trial stage because of uncertainty and the large investment.

o If these same consumers would be willing to use a large-screen television on a trial basis for a small
fee, the manufacturer should consider offering a trial-use plan with the option to buy.

o For adopting a new product, at first, the consumer becomes aware of the new product but does
not have information about it. The consumer shows interest and searches for information about
the new product. In the third stage, the consumer evaluates whether trying the new product is
worthwhile. After that, the consumer tries the new product on a limited scale to improve its
value assessment. At the last stage, the consumer decides to make full and regular use of the new
product.

o Marketing tools may change, the way consumers discover products may change, and consumer
behaviors may change, but the 5 stages that make up the consumer adoption process will always
remain the same. Let’s turn our attention to the stages of the adoption process.

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1. Product Awareness

o The consumer becomes aware of the new product but lacks information about it. Initially, the
consumer must become aware of the new product.

o Awareness leads to interest, and the customer seeks information about the new product.

o Whether an innovation is continuous or not, people are either little aware or aware of it initially.

o Innovator, therefore, has to inform the adopters about the innovation. In the awareness stage,
individuals become aware that the product exists, but they have little information about it and
are not concerned about getting more.

o Adopters may be informed through advertising, publicity, or any other effort of the marketer.

2. Product Interest

o The consumer seeks information about the new product. Once the information has been
gathered, the consumer enters the evaluation stage and considers buying the new product.

o By this time, the innovation is introduced. It is now the time for the decision-makers to
determine whether the innovation relates to their needs.

o They enter the interest stage when they are motivated to get information about its features, uses,
advantages, disadvantages, price, or location.

o Interest may or may not sparked, depending on whether the decision-makers perceive the
innovation as a relevant, feasible alternative to existing items.

3. Product Evaluation

o Next, in the trial stage, the consumer tries the product on a small scale to improve its value
estimate. The consumer considers whether trying the new product makes sense.

o Adopters of the innovations must establish some evaluation measures to compare the new
product with existing ones.

o During the evaluation stage, individuals consider whether the product will satisfy certain critical
criteria for meeting their specific needs. The potential adopters consider the innovation’s
benefits and determine whether to try it.

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4. Product Trial
o The consumer tries the new product on a small scale to improve their estimate of its value. If the

consumer is satisfied with the product, they enter the adoption stage, deciding to use the new
product thoroughly and regularly.
o At this stage, the potential adopters examine, test, or try the innovative product to determine its
usefulness.
o In this stage, they use or experience the product for the first time, possibly by purchasing a small
quantity, taking advantage of a free sample or demonstration, or borrowing the product from
someone.
o During this stage, potential adopters determine the product’s usefulness under the specific
conditions they need.
o The trial stage for innovations is complex. Successful introduction depends greatly on the new
product’s characteristics, benefits, and perceived risks. Effective communication is the key to
achieving trial by consumers.

5. Product Adoption
o The consumer decides to make full and regular use of the new product. The new product is a good,

service, or idea perceived by some potential customers as new.
o Individuals move into the adoption stage when choosing that specific product when they need a

product of that general type. Here the buyers purchase the new product and can be expected to use
it to solve problems.
o So, this final stage of the process is indicated most directly by sales, but the innovation’s visibility
is also a success measure.
o However, please do not assume that they will eventually adopt the new product because a person
enters the adoption process. Rejection may occur after any stage, including the adoption stage.

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2.2.4 Types Of Adopters

o Adopter categories divide consumers into segments based on their willingness to try out a new
innovation or product. People can be classified into 5 adopter categories. Consumers pass through

five stages in the process of adopting a new product.

1. Innovators.
2. Early Adopters.
3. Early Majority.
4. Late Majority.
5. Laggards.

Figure 2.76 Type of adopter

1. Innovators

o Innovators are venturesome – They are willing to try new products at some risk.

o The first users of the new product are called innovators. They tend to be younger people with
relatively high incomes, who are willing to spend more than normal sums of money for the
product, and take pride in being the first among their peers to own a particular new product.

o Consequently, they are the opinion leaders within their reference group. They derive much of their
social status and social satisfaction from the innovator role.

o As a result, they actively seek out new products that will help them in that pursuit.

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2. Early Adopters

o Early adopters are guided by respect. They are opinion leaders in their communities and adopt
new products early but carefully.

o Early adopters make up 13.5% of the total purchasers. Although they do not move as quickly as
innovators, they try a new product early in its life cycle without waiting for many people to accept
it.

o As innovators, they are reasonably affluent and want to be among the first to purchase a new
product. Along with the innovators, they are opinion leaders for their friends and colleges to
purchase and use the product type.

o One of the significant differences between innovators and early adopters is that they are not as
anxious to be the first purchaser. They are rather content to be second and do not actively seek
new products to the extent innovators do.

3. Early Majority

o The early majority are deliberated. Although they are rarely leaders, they adopt a new product
before the average person.

o They account for the next 34% to enter the market. They are distinctly different from the previous
two groups of buyers – innovators and early adopters.

o This group is more deliberate in its purchase decisions, looking to the innovators and early
adopters for buying cues, and is more price sensitive. The early majority adopt the product only
after it has been accepted somewhat widely.

o These consumers perceive more risk in new products than do innovators and early adopters.
Because this group is so large, it decides whether the product will succeed in general use or serve
a narrow market niche.

o Without at least part of this early majority, the product will probably not achieve sufficient sales
volume to be especially profitable.

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4. Late Majority
o Late majority are skeptical. They adopt an innovation only after a majority of people have tried it.
o This group comprises another 34% of the total market. This group sees even more risk in new
products than do those in the early majority.
o Customers in this category tend to be quite conservative and skeptical of new products, although
the product can hardly be considered new by this time in the life cycle.
o Moreover, they tend to be very price-sensitive and are generally unwilling to buy until they are
convinced that the price is at its lowest point.
o Members of the late majority do not view the product in terms of its life cycle, of course. Still,
they become comfortable about adopting it only after the innovation is widely accepted.

5. Laggards
o Laggards are tradition-bound. They are suspicious only when it has become something of a
tradition itself.
o The last group of buyers makes up the last 16% to make their purchases. They are the individuals,
households, or organizations that resist or never adopt the new product. The most distinguishing
characteristic of this group is their highly traditional buying patterns.
o They are likely to wait until they are sure a product has become accepted. This group consists of
older people who have lower-incomes, yet buying power is not the main reason why laggards are
so cautious – they are tied to the past.
o Although laggards may be timid by nature, that is not necessarily the reason they reject an
innovation. Some products are of little interest to certain customers, are not needed, or are too
expensive.

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REVISION QUESTION
1.Sketch a model of consumer decision making process.

2.State the purchasing roles in the decision-making process based on the description below.
No Description Purchasing roles
1 -Who have the power to determine unilaterally or jointly whether to shop

for, purchase, use, consume, or dispose of a specific product or service.
-Makes final decision occurred.
2 -Those who bring up the idea.
-Ex: reminds friends about their vacation.
3 -Who provide information to other members about a product or service.
-Roles: influences the alternatives, evaluate the final choice, and
convinces other members of the family of her choice.
4 -Those who use or consume a particular product or service.
5 -Who make the actual purchase of a particular product or service.
-The one that makes the purchase.

3.It is often to assume that consumer moves through few stages in arriving at a decision to purchase or
reject \new product. Explain FIVE (5) stages in the adoption process for buying a new hand phone.

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ANSWERS
1.Sketch a model of consumer decision making process.

NEED RECOGNITION
INFORMATION SEARCH

EVALUATION OF ALTERNATIVES

PURCHASE DECISION

POST PURCHASE BEHAVIOUR

2. State the purchasing roles in the decision-making process based on the description below.

No Description Purchasing roles

1 Deciders -Who have the power to determine unilaterally or jointly whether to shop

for, purchase, use, consume, or dispose of a specific product or service.

-Makes final decision occurred.

2 Initiator -Those who bring up the idea.

-Ex: reminds friends about their vacation.

3 Influencer -Who provide information to other members about a product or service.

-Roles: influences the alternatives, evaluate the final choice, and

convinces other members of the family of her choice.

4 Users -Those who use or consume a particular product or service.

5 Buyers -Who make the actual purchase of a particular product or service.

-The one that makes the purchase.

3.It is often to assume that consumer moves through few stages in arriving at a decision to purchase or
reject \new product. Explain FIVE (5) stages in the adoption process for buying a new hand phone.
(10m)

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1. Awareness
• Consumer is first exposed to the product innovation.
• Ex: Janet sees an ad for a new MP4 player in a magazine she is reading.

2. Interest
• Consumers interested in the product and
• Searches for additional information.
• Ex: Janet reads about the MP4 player on the manufacturer’s Web site and then goes to an
electronics store near her apartment and has a salesperson show her the unit.

3. Evaluation
• The consumer makes the decision as to whether they think the good or service will meet their
needs, sort of like a "mental trial."
• Ex: After taking to a knowledgeable friend, Janet decides that this MP4 player will allow her
to easily download the MP4 files that she has on her computer. She also feels that the unit’s
size is small enough to easily fit into her beltpack.

4. Trial
• Consumer uses the product on a limited basis
• Ex: Since an MP4 player cannot be “tried” like a small tube of toothpaste, Janet buys the MP4
player online from Amazon.com, which offers a 30-day (from the date of shipment) full-
refund policy.

5. Adoption
• If trial is favorable, consumer decides to use the product on a full rather than a limited basis if
unfavorable, the consumers decide to reject it.
• Ex: Janet finds that the MP4 player is easy to use and that the sound quality is excellent. She
keeps the MP4 player.

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REFERENCES
BOOKS:
Schiffman, L.G., & Wisenblit, J. L. (2018). Consumer Behaviour, Global Edition (12 th ed.). Pearson
Kotler, P., & Armstrong, G. (2017). Principles of Marketing. (17th ed.). Pearson
Sethna, Z. & Blythe. J. (2019). Consumer Behaviour (4th ed.). SAGE Publication.
Solomon, M. R. (2019). Consumer Behavior: Buying, Having and Being, Global Edition (12 th ed.). Pearson
Szmigin. I. & Piacentini. M. (2018). Consumer Behaviour (2nd ed.). Oxford University Press.
WEBSITES:
Interdisciplinary Study Of Consumer Behaviour. Retrieved from https://indiaclass.com/interdisciplinary-
dimensions-of-consumer-behaviour/ on the May 30, 2022.
Consumer Decision Making Process. Retrieved from https://www.yotpo.com/resources/consumer-decision-
making-process-ugc/ on the May 31, 2022.
Types Of Adopters. Retrieved from https://www.iedunote.com/5-adopters-innovators-adopters-majority-
laggards on the June 26th ,2022.
Stages of Adoption Process. Retrieved from
https://www.google.com/search?q=stages+in+the+adoption+process&oq=stages+in+the+adoption+process&a
qs=chrome.0.69i59j0i512j0i22i30l6j0i390l2.6223j0j15&sourceid=chrome&ie=UTF-8

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