Chapter 04 – Customer Buying Behavior
4-16
E. Approaches for Segmenting Markets
Lifestyle Segmentation
• Lifestyle, or psychographics, refers to
how people live, how they spend their time
and money, what activities they pursue,
and their attitudes and opinions about the
world they live in.
• Lifestyle is useful because it identifies
what motivates buying behavior. On the
other hand, it is difficult to identify and
access consumers in specific lifestyle
segments.
Ask students to classify themselves, their
parents, and their grandparents in terms of
lifestyle segmentation.
F. Buying Situation Segmentation
Contrast the differences in the buying situation
G. Benefit Segmentation
• Another approach for defining a target
segment is to group customers seeking
similar benefits. In the multiattribute
attitude model, customers in the same
Relate benefit segments back to the
multiattribute model. A benefit segment is
composed of customers who attach a high
importance weight to a specific characteristic
or benefit.
H. Composite Segmentation Approaches
Chapter 04 – Customer Buying Behavior
4-17
• No one approach meets all the criteria for
useful customer segmentation.
Ask students to describe different groups of women
(or men) shopping for moderate to good quality
leisure clothing, based on their lifestyles,
V. Summary
• To satisfy customer needs, retailers must
thoroughly understand how customers
make retailer store, Web site and purchase
decisions, and the factors they consider
when deciding.
Chapter 04 – Customer Buying Behavior
4-18
ANSWERS TO “GET OUT AND DO ITS”
2. GO SHOPPING Go to a supermarket and watch people selecting products to put in their
shopping carts. How much time do they spend selecting products? Do some people spend
more time than others? Why is this the case? Does consumer behavior vary in the store
perimeter versus in the aisles? Explain your observations.
Students may find a variety of shopping styles from this observational research trip. Some
3. OLC EXERCISE Go to the student site of the book’s website to develop a multiattribute
attitude model describing your evaluation of and decision about some relatively expensive
product you bought recently, such as a car or a consumer electronics product. Open the
multiattribute model exercise. List the attributes you considered in the left-hand column.
List the alternatives you considered in the top row. Fill in the importance weights for each
attribute in the second column (10 = very important, 1 – very unimportant); then fill in
your evaluation of each product on each attribute (10 = excellent performance, 1 = poor
performance). Based on your importance weights and performance beliefs, the evaluation
of each product appears in the bottom row. Did you buy the product with the highest
evaluation?
Students should access the online learning center to find a template for the multiattribute model.
They should then consider their most recent, extensive problem solving, purchase. List the
considered far more important?
4. INTERNET EXERCISE To better understand the segmentation classification of
consumers, Strategic Business Insights has developed the VALS tool, which uses
psychology to segment people according to their distinct personality traits. Go to the firm’s
Chapter 04 – Customer Buying Behavior
What is your VALS profile type? Do you agree with your consumer profile? Why or why not?
How can retailers effectively use the results of this survey when planning and implementing their
business strategies?
5. INTERNET EXERCISE Retailers want to segment the market on the basis of the
geographic classification of customers to select the best sites for their businesses. Go to the
your hometown or your campus, and read the results. How would a retailer, such as a local
restaurant, use the information in this report when making a decision about whether to
open a location in this zip code?
ESRI uses geography to help governments, industry leaders, academics, and other
6. INTERNET EXERCISE Go to the following Internet sites offering information about the
fashion.telegraph.co.uk. Write a brief report describing the latest apparel fashions that are being
shown by designers. Which of these fashion trends do you think will be popular with college
students? Why?
Students interested in fashion and apparel merchandising will really like this exercise. This is
ANSWERS TO DISCUSSION QUESTIONS AND PROBLEMS
Chapter 04 – Customer Buying Behavior
4-20
1. Does the customer buying process end when a customer buys some merchandise?
Explain your answer.
No, the customer buying process does not end when a customer buys some merchandise.
2. Describe how service retailers, such as hotels, provide information to potential
customers to answer questions about services offered, rates and other amenities.
Consumers may seek information to help satisfy the need (where to stay, room rates, hotel
amenities, etc.). This step could be long or short depending on the consumer’s prior knowledge
and the risk involved.
3. Considering the steps in the consumer buying process (Exhibit 4-1), describe how you
(and your family) used this process to select your college/university. How many schools
did you consider? How much time did you invest in this purchase decision? When you
were deciding on which college to attend, what objective and subjective criteria did you
use in the alternative evaluation portion of the consumer buying process?
To answer this question, students need to consider the following steps in the decision
making process:
Chapter 04 – Customer Buying Behavior
4-21
4 In Exhibit 4-6, The Inner City Tenant is described. How should banks, restaurants,
drugstores, and car dealers alter their retail mixes to meet the needs of this segment
compared to the Top Rung segment?
The Inner City Tenant is a younger customer from a diverse background who lives in a city
5. Any retailer’s goal is to get customers in its store so that they can find the merchandise
that they are looking for and make a purchase at this location. How could a sporting
goods retailer ensure that the customer buys athletic equipment at its outlet?
A sporting goods retailer can ensure that a customer buys athletic equipment in their store by
helping customers decrease their information search. In general, retailers want to reduce the
6. A family-owned used-book store across the street from a major university campus
wants to identify the various segments in its market. What approaches might the store
owner use to segment its market? List two potential target market segments based on
this segmentation approach. Then contrast the retail mix that would be most
appropriate for the two potential target segments.
• Target segment defined on demographics might be:
Chapter 04 – Customer Buying Behavior
4-22
7. How does the buying decision process differ when consumers are shopping on the
Internet or mobile compared with shopping in a store in terms of locations or sites
visited, time spent, and brands examined?
When shopping online, customers might spend more time searching for information and
8. Using the multiattribute attitude model, identify the probable choice of a local care
dealer for a young, single woman and for a retired couple with limited income (See the
table that follows). What can the national retail chain do to increase the chances of the
retired couple patronizing its dealership? You can use the multiattribute model
template found in the Online Learning Center to analyze this information.
Chapter 04 – Customer Buying Behavior
4-23
Importance Weight
Performance Beliefs
Characteristics
Young
Single
Retired
couple
Local Gas
Station
National
Service
Chain
Local
Car
Dealer
Time to
10
9. Think of a recent purchase that you made and describe how economic and social
environmental factors (e.g., reference group, family and culture) influenced your
buying decision. How are retailers using social media to impact your buying decisions?
Economy- based on the changes in the national and global economy, consumers have
changed their buying habits. May consumers are now searching for more discounts and
Chapter 04 – Customer Buying Behavior
4-24
10. Think about the merchandise sold at Office Depot, Staples and Office Max and list
three to four types of merchandise that fall into extended problem solving, limited
problem solving and habitual decision making for college students. Explain how the
categories of merchandise would change for each type of buying decision if the
customer was a medium-sized business owner?
As marketers we examine the level of involvement and amount of time a consumer spends in
the buying process. Depending on the significance of the purchase, consumers will be more
or less involved in the purchase process with varying amounts of time and research.
Chapter 04 – Customer Buying Behavior
4-25
ANCILLARY LECTURES AND EXERCISES
Lecture # 4-1 THE MULTIATTRIBUTE MODEL
Instructors’ Note: This lecture can be used to demonstrate a model designed to predict a
customer’s evaluation of a product or retailer based on their performance on several attributes
and the importance of those attributes to the customer. PowerPoint slides are available to
accompany this lecture.
Introduction
• The multiattribute model is based on the notion that customers see a retailer or a product as a
collection of attributes or characteristics.
Beliefs about performances
• A customer considering shopping at three retailers mentally processes the “objective’
information about each of the retailers and forms an impression of the benefits the retailer
provides.
Chapter 04 – Customer Buying Behavior
4-26
Importance weights
• A customer may develop an overall evaluation of each retailer based on the importance
he/she places on each of the benefits provided by the retailers. For example, the importance
Choice of Alternatives
• For the young woman, the Internet grocer has the highest score, and thus the most favorable
evaluation. However, the Supercenter has the highest score for the parent, who would
probably buy the family’s weekly groceries there.
Chapter 04 – Customer Buying Behavior
4-27
Implications for retailers
• First, the model indicates what information customers use to make their decision about
which retailer to patronize. Thus, to develop a program for attracting customers, the retailer
needs to do market research to collect the information listed below.
1. Getting into the consideration set
The retailer must make sure that it is included in the customer’s consideration set. The
consideration set is the set of alternatives the customer evaluates when making a
2. Changing performance beliefs
The first approach involves altering customer’s beliefs about the performance of the
retailer—increasing the retailer’s performance rating on a characteristic. For example, the
supermarket would want to increase its overall rating evaluation by improving its ratings
3. Changing importance weights
Altering customers’ importance weights is another approach to influencing retailer choice. A
4. Adding a new benefit
The retailer might try to add a new benefit to the set of benefits that customers consider
Chapter 04 – Customer Buying Behavior
4-28
ANCILLARY EXERCISE # 4-1: USING THE MULTIATTRIBUTE MODEL FOR
CHOOSING A STORE
—————————————-———
Instructor’s Note: This exercise is intended to give students the opportunity to use the
multiattribute Model found in the text. Instructors might want to use this lecture as a stimulus to
a class discussion on the topic.
—————————————-———
Instructions
• Pick a student who has recently made a store choice decision — such as choosing a retailer to
buy jeans, get a haircut, buy groceries, or eat a meal.
• List these benefits offered on the row in the left-hand column.
• Ask the student which characteristics or benefit is the most important to him/her and give
benefit a 10 in the importance weight column.
Chapter 04 – Customer Buying Behavior
4-29
• The student typically will have gone to the retailer with the highest score.
ANCILLARY EXERCISE # 4-2
Using the multiattribute attitude model and the following information, identify the probable
choice of a retail store for a young single businesswoman and for a retired couple with limited
income buying a TV set.
IMPORTANCE WEIGHTS
PERFORMANCE BELIEFS
CHARACTERISTIC
YOUNG
SINGLE
RETIRE
D
COUPLE
DISCOUNT
STORE
DEPART-
MENT
STORE
Price
Services
Assortment
environment
young single
retired couple
CATEGOR
Y
SPECIALIS