IMM GRADUATE SCHOOL

Express Course

Consumer Behaviour,
Research and Marketing
Decision-Making
 Topic 1:
Consumer decision-making
Introduction
Welcome to Topic 1 of your consumer behaviour, research and marketing decision-making
express course.

If marketing is the heartbeat of the organisation, then consumers are the reason why the heart
beats. Without the consumer, there is no market, which means that there will be no demand
or interest in the organisation’s products or services. This module identifies and discusses the
various psychological and social forces that affect consumer behaviour. By learning more
about how consumers behave, organisations gain a better understanding as to why customers
buy what they buy or, more generally, why they respond to marketing stimuli as they do. This
understanding further enables marketers to explain, influence and predict consumer
behaviour.

What is consumer behaviour all about?

Consumer behaviour is defined as: “The behaviour displayed by consumers when searching
for, purchasing, using, evaluating and disposing of products and/or the services.” (Boshoff,
2017).

Organisations that focus on the needs of consumers ensure that they provide products and
services that serve consumers and offer them value. Customers express their support for a
company by buying its products and becoming loyal to a company. Generally, this loyalty
depends on the perceived value of its products to the customer. A product will, therefore, sell
well only if it meets the needs of customers, who exercise their “choice” by becoming a regular
customer of the marketer they believe responds best to their needs. Consumers’ behaviour
consists of a series of choices. These choices are a result of decisions made to buy one product
over another, or to support one brand instead of its competitor. These purchasing decisions
that consumers make are based on both internal and external factors.

Consumer decision making

The model below illustrates the various influences that may exert pressure on the consumer
at any stage during the purchasing decision-making process.

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 Factors influencing the consumer decision-making process (Boshoff, 2019)

As the model indicates they can be grouped under individual, group, situational and marketing
mix elements. The individual and group influences will be discussed in more detail throughout
this module and will be referred to as psychological forces and socio-cultural influences. The
situational factors were discussed in the previous module.

Types of consumer decision making

There are three types of consumer decision making:

Routine decision making: This is the simplest type. The level of consumer involvement is
typically low, the time required is short and the product is inexpensive (e.g. purchasing bread
or milk).

Limited decision making: With this type, the consumer is more involved than during routine
decision making, but less involved then during extensive decision making. For example,
watches, clothes or washing machines. Online clothes shopping is also an example of limited
decision making. The fact that many online retailers offer the opportunity to exchange
purchases at no cost to the buyer, reduces perceived risk in the mind of the customer.

Extensive decision making: Here the level of consumer involvement is typically high, the time
required to make the decision is long and the product is expensive (e.g. a car or a house). The

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 Internet has radically changed the way consumers search for information when it comes to
car purchases. Most of the research is done online by looking at dealership websites, reviews
and cost comparison sites.

For example, pricecheck.co.za:

In fact, most customers have already decided on the brand of car they will purchase before
they enter the dealership.

Consumer involvement

Involvement is defined as “the level of time and effort that is invested by a consumer
(potential buyer) in the search, evaluation and decision-making processes associated with
consumer behaviour” (Boshoff, 2017). There are various
situations that can influence the consumer’s involvement in
purchasing a product.

This level of involvement is influenced by the customer’s:

Previous experience: For example, if the consumer buys bread,

his/her level of involvement will be low as this is a product,
he/she buys often. However, if he/she buys a product like a stove, which is not a product that
he/she buys often, his/her level of involvement will be higher.

Interest: For example, a person who is extremely interested in pianos will take a lot of time
to research the various pianos available in the market before buying one.

Perceived risk: The higher the price of the product, the higher the perceived risk and
therefore the more research the customer will undertake before purchasing the product.
When it comes to online shopping, there are still many consumers that are hesitant to give
their credit card details to an organisation that they do not recognise. For that reason, many
online retailers are now offering ‘cash on delivery’ options.

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 Situation: For example, a person who buys a printer for home use will approach the
purchasing process very differently to when he or she buys a printer for an office where many
people will be using the same printer.

Social visibility: For example, if a person buys a dress for a business event where many of her
clients will be present, she will spend more time to purchase than when buying a dress which
she will mostly be wearing at home.

The consumer decision making process

In order to understand the process that a consumer goes through when purchasing a product
or service, it is important that the marketer is able to track their behaviour through each step
of the decision-making process. By researching these steps relevant to their target market, the
marketer can make strategic decisions regarding how their product or service is
communicated to the customer every step of the way. This topic will therefore discuss the five
steps in detail.

The consumer decision-making process consists of the following five stages:

Five stages of the consumer decision-making process (Boshoff, 2019)

Let’s review each stage in more detail:

Stage 1: Need recognition

Need recognition is when a consumer realises that he/she has a need that it is not satisfied.
For example, a student may realise that in order for him/her to hand in an assignment, he/she

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 would need to have a computer. The marketer can use this opportunity to advertise specific
home computers to students that are affordable and user-friendly.

As mentioned in module 1, it is critical that the marketer is constantly undertaking research

to identify the key motivating factors that influence consumer decisions. Needs and wants are
constantly changing, but thanks to various online research tools, marketers now have access
to information about existing and potential customers that was previously very expensive and
time consuming to access. Take for example comments on a Facebook page or Instagram
account, or customer reviews on Amazon – these are all sources of valuable information that
could influence your marketing strategy.

See below screenshots of customers reviews for a mobile phone on Amazon.

Source: Amazon.com
Stage 2: Information search
Here the consumer searches for information that will assist him/her in making a buying
decision. In our student example above, the student may now for example do online research
on home computers, visit stores like Incredible Connection and Makro and speak to their sales
personnel, etc. He/she will compare prices, functionality, etc. of the various types of home
computers available.

The level of the consumer’s external information search will be influenced by:

Perceived risk – a computer is quite pricy, and the student will probably undertake quite
extensive research.

Existing knowledge – if he/she does not know much about computers, he/she will do much
more research.

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 Previous experience – if the customer has limited experience in using a computer, he/she will
do more extensive research than if he/she has a lot of experience with using computers.

Level of interest – the more the student is interested in buying the computer, the more
research he/she will undertake.

Stage 3: Evaluation of information and alternatives

In this stage the consumer considers the information collected during stage two and evaluates
the alternatives that are available. The student will most probably compare the various
products’ characteristics and set budgetary limits for him/herself (called ‘cut-off’ points).
From all the computers that he/she investigated, he/she will form an evoked set (also called a
‘consideration set’), which is a small number of computer models from which he/she will
choose the final computer that he/she will buy.

Digital marketing can be extremely impactful during this stage. This is where a marketing tool
called ‘remarketing’ is effective. Google defines remarketing as follows:

“Remarketing is a way to connect with people who previously interacted with your website or
mobile app. It allows you to strategically position your ads in front of these audiences as they
browse Google or its partner websites, thus helping you increase your brand awareness or
remind those audiences to make a purchase.”

Stage 4: Decision to purchase or not

After having done his/her homework, the student now needs to decide whether he/she will
buy a computer or not.

Stage 5: Post-purchase behaviour

If the student decided to purchase a computer, he/she will experience some level of doubt.
This feeling, called cognitive dissonance, makes the customer unsure about whether he/she
made the right purchasing decision. The computer company should use this time after the
student has purchased the product to reiterate the product benefits to him/her and provide
after-sales services to make him/her feel more comfortable with his/her purchase decision.

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 Topic 2:
Internal factors influencing consumer decision
making
Introduction
Welcome to Topic 2 of your consumer behaviour, research and marketing decision-making
express course.

Internal factors are also called individual factors, as these are internal to the consumer. These
factors influence how a consumer behaves and makes decisions. Obviously internal factors
will differ from one person to the next. Psychological variables are factors that influence the
decision-making of consumers to purchase or not. These factors are mainly internal to
consumers and include the following aspects:
• Perception
• Learning
• Motivation
• Attitude
• Personality and lifestyle
In this topic we review each of these in detail.

Perception

Perception refers to how we gather and interpret information from the world around us. If the
consumer has a negative perception of a product, purchasing the product will be unlikely.

Perception involves seeing, hearing, feeling, tasting and smelling. Stimuli picked up by the
senses are relayed to the brain where they are interpreted. The buyer reacts according to this
interpretation and not always according to the objective reality. Subjective factors always play
a role in perception.

Perception is influenced by experiences, values and prejudices of an individual. Few people

perceive things in exactly the same way, as we all have different values, experiences and
prejudices, which mean that we perceive the world in different ways. You have heard of the
sayings “the glass is half full” or “the glass is half empty” – well that is a perfect illustration of
how people see the same thing differently.

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 Perception also plays a role in the interpretation of a marketing message. A buyer will perceive
a certain market offering only after receiving sensory stimuli, especially after seeing or hearing
the marketing message.

Consumer perceptions determine what they pay attention to and what excites their interest.
They subconsciously choose whether to pay attention to a marketing message or not.
Furthermore, consumers’ perceptions cause them to attach their own interpretation to a
message, which may not quite be what the marketer intended. Consumers seem able to
defend or protect themselves against the content of communication. An advertisement must
be simple to ensure complete understanding of the message.

It should have some impact to attract attention and must contain a promise of need
satisfaction or else consumers could distort the message or ignore it completely.

The Rolling Stones campaign from 1985 is a

great example of how an ad campaign
changed customer perceptions of their
magazine. The problem the magazine
encountered was that advertisers were not
advertising in the magazine as they still
associated it with the hippies from the 60's
and as a result believed that the magazine’s
target market had little discretionary income
to spend on expensive products.
Source: themarketingsage.com (2019)

To solve the problem, they introduced the

“Perception/Reality” campaign with a series
of print advertisements illustrating how
advertisers perceived the target market and
the reality of who the target market actually
was. The 60's hippy was now a wealthy
yuppie and the burnt bra was now a
Wonderbra. The campaign was a massive
success, far exceeding their desired
objectives.
Source: themarketingsage.com (2019)

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 Perceptual selection
Consumers are often selective with what they perceive. Perceptual selection is characterized
by the following:

Selective exposure
Consumers actively seek out messages that they find pleasant or with which they are
sympathetic. And they actively avoid painful or threatening ones. They also selectively expose
themselves to advertisements that reassure them of the wisdom of their purchase decisions.
If a consumer purchases a car, they will feel positive towards great advertisements that
reinforce that they have made the correct decision.

Selective attention
Consumers exercise a great deal of selectivity in terms of the attention they give to
commercial stimuli. They have a heightened awareness of stimuli that meet their needs or
interests and minimal awareness of stimuli irrelevant to their needs. Thus, consumers are
likely to note ads for products that would satisfy their needs and disregard those in which they
have no interest.

Perceptual defense
Consumers subconsciously screen out stimuli that they find psychologically threatening, even
though exposure has already taken place. Thus, threatening or otherwise damaging stimuli
are less likely to be consciously perceived than are neutral stimuli at the same level of
exposure. For example, a smoker may avoid advertising messages that remind them that
smoking is bad for their health.

Perceptual blocking
Consumers protect themselves from being bombarded with stimuli by simply “tuning out” –
blocking such stimuli from conscious awareness. They do so to protect themselves from the
visually overwhelming nature of the world in which we live. Social media platforms now allow
consumers to follow only the topics or people that they are interested in.

Perceptual organisation
Consumers make sense of the information they have perceived by linking it to knowledge they
already have. Various ‘laws’ of perceptual organisation exist. Here are three of the most
important ones:

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 Figure and ground
“Figure and ground” is a type of perceptual grouping which is a vital
necessity for recognising objects through vision. In Gestalt psychology it
is known as identifying a figure from the background. People tend to
organise perceptions into figure-and-ground relationships. Marketers
usually design so the figure is the noticed stimuli and the ground
(background is less dominant).

Do you see a young or old lady in the image below? This illustrates how individuals can
perceive images differently and why there needs to be aa focusing images.

Grouping
Individuals are more likely to
perceive a variety of information
as groups rather than as
separate units. It therefore
makes sense for marketers to
group visual and verbal
associations that can
communicate their product or
service to the consumer. The
shampoo ad below has grouped
various key elements together
(the colour green, the Garnier
logo, product packaging and strong hair). If you consider how “figure and ground’ applies to
this ad, the marketer is intending for the strong hair to be the most dominant stimulus even
though the background still plays and important supporting role.

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 Closing
Perception favours a complete or closed figure.
Closure, therefore, refers to a perceiver's tendency to
fill in the missing elements when a stimulus is
incomplete. An advertisement that asks a question is
likely to be more memorable because of the
consumer’s need for closure.

Perceptual interpretation
Perceptual Interpretation occurs when a
person assigns a meaning to the sensory
stimulus from a product or brand.
Comprehension is aided by expectations
and familiarity. A consumer scans his
memory to retrieve previous experiences
with the brand or a similar brand.
Marketers therefore need to assist the
consumer to quickly identify their brand
and understand the benefits that the brand has to offer in the shortest time possible. Coca-
Cola has worked hard to ensure that their brand is immediately visible and offers meaning to
the consumer at all points of purchase.

Value of perception for marketers

If marketers are able to understand the different types of perceptual interpretations that
consumers experience, then they are more equipped to create relevant, memorable and
meaningful communications for their target markets.

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 Types of perceived risks
Consumers face uncertainty when they cannot foresee or predict the consequences of their
purchase decisions. There are various types of perceived risk that consumers experience:

Learning

The learning ability of consumers determines whether they are able to learn the marketer’s
‘lesson’ about the benefits of a particular product that make it worth paying for. In addition,
the marketer should ‘teach’ consumers the product’s name in such a way that they remember
it. Sometimes, consumers forget the name of the product they intend to purchase but are still
able to recognise the distinctive packaging among other products on the shelf.

Reminder advertising, in which only the name of a product in distinctive lettering appears on
a billboard, helps to remind consumers of what they have learnt from the marketer.

Consumer learning may result from things that marketers do, or it may result from stimuli that
have nothing to do with marketing. Either way, almost all consumer behaviour is learnt.
Consumers need to learn which product attributes relate to which brand and where it can be
purchased, as well as be able to recognise the distinctive packaging. The buyer must
remember the information supplied in the marketing message when in a position to act.

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 Learning refers to the change in the thought process and behaviour as a result of prior
experience. Consumers learn through previous purchasing experiences which products they
would purchase again and which they would not. Learning occurs through repetition. When
considering this important variable, marketers need to ’teach’ their customers how to
engage with them on a whole new level.

For learning to take place, the following elements usually have to exist:

Motivation (driving force)

Motivation is the driving force that compels action. Uncovering consumer motivations is
extremely important for marketers, who then try to teach motivated consumer segments why
and how their products will fulfil the consumers’ needs. For example, a consumer may
purchase an expensive whiskey with friends because it makes them feel as if they are upper
class, but that same person may purchase a cheaper whiskey when they are alone because
they don’t feel the need to impress anyone.

Cues (information from the consumers senses/stimuli senses)

Motives encourage learning and cues stimulate the direction to these motives
For example, in a market, the styling, packaging and in-store displays all serve as cues to help
consumers to decide on a particular product, but this can only happen if the consumer has
the motive to buy. Thus, marketers need to ensure that all the relevant cues are carefully
planned to attract the consumer’s attention
Response (action)
Response signifies how a consumer reacts to the cues. The response can be shown or hidden,
but in either of the cases learning takes place. Often marketers may not succeed in stimulating
a purchase, but the learning takes place over a period of time and the consumer may purchase
the product at a later stage.

Reinforcement
Reinforcement is very important as it increases the probability of a particular response in the
future driven by motives and cues. If a consumer makes a purchase and the after sales service
is particularly impressive, this will reinforce that fact that they have made the correct decision.

The concept of learning provides several marketing insights:

Repetition
In order for information to remain in the mind of the consumer in the medium or long term,
repetition is key. Marketers need to therefore ensure that the consumer is exposed to multiple
messages on multiple platforms. The marketer cannot however rely simply on repeating the

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 same message in the same way as this may result in the consumer becoming annoyed with
the repetition and result in a negative attitude towards the product.

Stimulus generalisation

It is important to understand how

stimulus generalisation can influence
responses to the conditioned stimulus.
Once a consumer has been conditioned
to respond to a stimulus, very similar
stimuli may produce the same response
as well.

Sometimes this can be problematic in the case of

competitors. Magnum and Mega ice cream have
extremely similar stimuli which could result in the
consumer purchases the competitor brand as
opposed to the original.

Stimulus discrimination
Stimulus discrimination involves the ability to distinguish between one stimulus and similar
stimuli. In the case of Magnum and Mega the consumer may make a decision based on taste
and discriminate against the other stimuli such as packaging and price in order to purchase
the best tasting ice cream.

Motivation

Motivation consists of three elements, namely:

Needs - the most basic forces that motivate an individual to do something.
Wants - ways of satisfying needs that are learnt during an individual’s life.
Motives - a need or want sufficiently stimulated to move an individual to seek satisfaction.

“Motivation can be described as the driving force in people that compels them to act a certain
way or make a specific decision. Once a consumer realises they have a need, they often set a
goal that will help them to satisfy their need. The tension that follows from an unsatisfied

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 need and the process that follows to alleviate the tension is referred to as motivation.”
(Boshoff, 2017)

Motivation can be positive or negative in

orientation. Consumers may feel a driving force
toward some object or condition or a driving force
away from some object or condition. For example,
a person may be impelled toward a restaurant to
fulfil a hunger need and away from motorcycle
transportation to fulfil a safety need.

Take smoking, for example. In the years where the

dangers of smoking were not yet recognised,
advertisers used positive motivation to encourage
customers to buy their brand.

Now that the health dangers of smoking are

apparent, negative motivation in the form of
‘warning labels’ on packs is used to deter people
from smoking.

What is quite alarming though, is that these warnings do not

appear to be working.

Maslow was an American psychologist who studied motivation. He identified a theory known
as the hierarchy of needs that looks as follows:

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 Image Source: ThoughtCo (2019)

According to Maslow, we have five categories of needs: physiological, safety, love, esteem,
and self-actualisation. In this theory, higher needs in the hierarchy begin to emerge when
people feel they have sufficiently satisfied the previous need. Although later research does
not fully support all of Maslow’s theory, his research has impacted other psychologists and
contributed to the field of positive psychology.

Physiological - These refer to basic physical needs, such as drinking when thirsty or eating
when hungry. According to Maslow, some of these needs involve our efforts to meet the
body’s need for homeostasis; that is, maintaining consistent levels in different bodily systems
(for example, maintaining a body temperature of 98.6 degrees). Maslow considered
physiological needs to be the most essential of our needs. If someone is lacking in more than
one need, they’re likely to try to meet these physiological needs first. For example, if someone
is extremely hungry, it’s hard to focus on anything else besides food. Another example of a
physiological need would be the need for adequate sleep.

Safety - Once people’s physiological requirements are met, the next need that arises is a safe
environment. Our safety needs are apparent even early in childhood, as children have a need
for safe and predictable environments and typically react with fear or anxiety when these
needs are not met. Maslow pointed out that, in adults living in developed nations, safety
needs can be more apparent in emergency situations (e.g. war and disasters), but this need
can also explain why we tend to prefer the familiar or why we do things like purchasing
insurance and contributing to a savings account.

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 Love and belonging - According to Maslow, the next need in the hierarchy involves feeling
loved and accepted. This need includes both romantic relationships as well as ties to friends
and family members. It also includes our need to feel that we belong to a social group.
Importantly, this need encompasses both feeling loved and feeling love towards others. Since
Maslow’s time, researchers have continued to explore how love and belonging needs impact
well-being. For example, having social connections is related to better physical health and,
conversely, feeling isolated (i.e. having unmet belonging needs) has negative consequences
for health and well-being.

Esteem - Our esteem needs involve the desire to feel good about ourselves. According to
Maslow, esteem needs include two components. The first involves feeling self-confidence and
feeling good about oneself. The second component involves feeling valued by others; that is,
feeling that our achievements and contributions have been recognized by other people. When
people’s esteem needs are met, they feel confident and see their contributions and
achievements as valuable and important. However, when their esteem needs are not met,
they may experience what psychologist Alfred Adler called “feelings of inferiority.”

Self-Actualisation - Self-actualisation refers to feeling fulfilled or feeling that we are living up

to our potential. One unique feature of self-actualisation is that it looks different for everyone.
For one individual, self-actualisation might involve helping others; for another person, it might
involve achievements in an artistic or creative field. Essentially, self-actualisation means
feeling that we are doing what we feel we are meant to do. According to Maslow, achieving
self-actualisation is relatively rare, and his examples of famous self-actualised individuals
include Abraham Lincoln, Albert Einstein, and Mother Teresa.

How people progress through the hierarchy of needs - Although Maslow presented his needs
in a hierarchy, he also acknowledged that meeting each need is not an all-or-nothing
phenomenon. Consequently, people don’t need to completely satisfy one need in order for
the next need in the hierarchy to emerge. Maslow suggests that, at any given time, most
people tend to have each of their needs partly met—and that needs lower on the hierarchy
are typically the ones that people have made the most progress towards.

Additionally, Maslow pointed out that one behavior might meet two or more needs. For
example, sharing a meal with someone meets the physiological need for food, but it might
also meet the need of belonging. Similarly, working as a paid caregiver would provide
someone with income (which allows them to pay for food and shelter), but can also provide
them a sense of social connection and fulfillment. (ThoughtCo, 2019)

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 Attitude

Attitudes encompass an individual’s value system, which represents personal standards of

what is good and bad, right and wrong. An attitude is a person’s point of view towards
something. The ‘something’ may be a product, an advertisement, a salesperson, a firm or an
idea. Attitudes are important because they affect the selection processes, learning and
eventually the buying decisions consumers make.

Marketers strive to reinforce the positive attitudes held by consumers, considering that it is
far more difficult to change strongly held attitudes. A consumer with a positive attitude
towards a certain product can perhaps be persuaded to purchase a product, whereas a
consumer with a negative attitude will not be persuaded to buy. A negative attitude is
extremely difficult to change. Once you have a bad experience at a restaurant, it is not easy to
get you back. In addition, there are many social media platforms available for an unhappy
customer to complain about a product or service.

For example, zomato.com is a well-known site that shares information and menus from a
range of restaurants on a global basis. It does however also allow members to comment on
restaurants and post photos of their experience. Marketers can, however, try to reinforce
existing positive attitudes or to change neutral attitudes to favour their products.

In an attempt to relate attitude more closely to purchase behaviour, some marketers stretched
the attitude concept to include consumer ‘preferences’ or ‘intention to buy’.

Research on consumer attitudes and beliefs can sometimes help a marketing manager get a
better picture of markets. For example, consumers with very positive attitudes towards a new
product idea might provide a good opportunity, especially if they have negative attitudes

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 about competitors’ offerings. Or they may have beliefs that would discourage them from
buying a product, taking into consideration that it is more economical to work with consumer
attitudes than to try to change them.

There are four main principles pertaining to attitude:

Attitude is usually directed towards something – Attitudes can vary for different products or
services. You may like ice-cream but not milkshakes.
Attitudes are learnt over time – If you taste a chocolate and you like it, your attitude will be
positive.
Attitudes are usually situational – You may not like ice-cream that much but on a hot day you
may eat one.
Attitudes have consistency – As a child you didn’t enjoy cabbage, and even though as an adult
your tastes may have changed, you are still not mad about cabbage as part of your meal.

An important attitude model to understand is the tri-component model. It suggests that

attitudes comprise the following three components:

Cognition - The cognitive component consists of the total configuration of beliefs and
knowledge about a certain object, as well as previously gained experience. For example, a
consumer’s attitude towards a brand of motor vehicle would be based on the beliefs and
knowledge that they had gained over time.

Affect - The affective component involves emotions, feelings and prejudices. If one considers
the attitude towards the motor vehicle, the consumer could have a positive attitude based
on the personal experience with the brand and how is makes them feel.

Conation - The behavioural component has to do with habits, reactions and intentions. If the
consumer had made up their mind that the knowledge available to them and the emotions,
they feel about purchasing a particular motor vehicle are so positive that they now intend to
purchase the vehicle.

There have been many models like the one above developed on attitude. Mostly these models
have provided marketers with the following three lessons:
Attitudes have an important impact on intentions – If you have an intention to buy an Apple
computer, the likelihood is you will eventually choose that brand.
Attitude towards and object differs from attitude towards behaviour – You may love cake
(object) but because you are a diabetic (situation), you avoid eating it.
Attitudes are extensively influenced by consumer beliefs and values – You may believe that
you should rinse your hair twice after washing it (belief), but due to water restrictions
(situation) you feel it is wrong to waste water (values).

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 Personality and lifestyle

Personality distinguishes one individual

from another and one group of
individuals with similar characteristics
from another group.

There are several personality types

identified by research. While research
seems to indicate that individual traits
are not good predictors of behaviour, it
is a well-known fact that marketers use
personality traits to describe individuals
and to differentiate between them.

It is also true that marketers can expect

that buyers will tend to purchase the
product that reflects the personality
most pleasing to them.

Take for example the purchase of a car.

The buyer may purchase a car that they
feel reflects who they are or a car that they feel is an extension of who they would like to be.

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 As a rule, a combination of people’s personality traits
and other characteristics determine their lifestyle.

Inner-directed individuals (who use their own values

and standards in evaluating products) prefer
advertisements that stress product features and
personal benefits, while other-directed people (who
tend to look to others to give direction to their actions)
prefer advertisements that feature social environment
or social acceptance.

So other-directed customers may be more easily

influenced because of their natural inclination to go
beyond the content of an advertisement and think in
terms of likely social approval of a potential purchase.

The ad below is aimed at other-directed individual:

Lifestyle refers to the way of living of
individuals or families. The lifestyle
concept provides descriptions of
behaviour and purchasing patterns,
especially the ways in which people
spend their time and money. Lifestyle
is a function of one’s inherent
individual characteristics that have
been shaped through social
interaction as you move through your
life cycle.

Psychographics or lifestyle analysis is the analysis of a person’s day-to-day pattern of living, as

expressed in that person’s activities, interests and opinions. Lifestyle analysis assumes that
marketers can plan more effective strategies if they know more about their target markets.
Understanding the lifestyle of target customers has been especially helpful in providing ideas
for advertising themes.

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 Emotion

Despite millions of years of evolution and the development of abstract thought and critical
thinking, humans still rely heavily on emotions when making decisions. Because of this, as
marketers, we need to be masters of connecting emotionally with customers and clients.

“The most startling truth is we don’t even think our way to logical solutions. We feel our way
to reason. Emotions are the substrate, the base layer of neural circuitry underpinning even
rational deliberation. Emotions don’t hinder decisions. They constitute the foundation on
which they’re made!” (Douglas Van Praet, the author of Unconscious Branding, 2017)

The role our emotions play when making decisions can’t be ignored. MRI tests have shown
that when subjects evaluate products or brands, their limbic systems (where our feelings,
memory, and value judgments originate) light up, while the data processing and analysis
centers of their brains are left largely unstimulated. In other words, most of the purchase
decisions people make are emotional, not practical.

When the decisions humans make are largely based on how they feel, marketers can capitalize
by communicating a feeling and removing emphasis on the cold hard facts. You need to appeal
to the human, not the buyer.

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 Topic 3:
External/socio-cultural factors influencing
consumer decision making
Introduction
Welcome to Topic 3 of your consumer behaviour, research and marketing decision-making
express course.
This topic will explore the external factors that influence the consumer decision-making
process. External factors are factors that are ‘outside’ of the individual consumer, but also
have an influence on the consumer’s decision-making process and his/her behaviour.
Examples of these factors also referred to as group factors are:
• Culture
• Sub-culture
• Reference groups
• Family Social Class
In this topic we review each of these group factors in detail.

Culture

“Culture is the sum of learnt beliefs, values and customs that ultimately direct human
(including consumer) behaviour within a society.” (Boshoff, 2017)

Culture consists of various elements that make

one culture unique to another. Examples of
these include language, religion, habits,
superstitions and beliefs. Culture includes the
whole set of beliefs, attitudes and ways of doing
things of a reasonably homogeneous set of
people. The cultural values, norms and symbols
are created by people and are transmitted from
one generation to another to ensure survival
and also to facilitate adaptation to the
circumstances of life. They are transmitted from
parents to children. In this process the school,
church and other social institutions also play an

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 important role. At an early age, we begin to acquire from our social environment a set of
beliefs, values and customs that make up our culture. The cultural group that a consumer
belongs to will greatly influence consumer behaviour of the individual.

If the cultural group the individual belongs to forbids the eating of pork, the individual would
not purchase this product. Advertising messages, which are directed simultaneously at multi-
cultural consumer markets, are often variations of the same theme. Marketing management
must, however, be careful not to use symbols which can be interpreted incorrectly (or
differently) and not to portray unacceptable behaviour patterns. Effective communication
can take place only if the theme of the advertising message reflects the cultural norms, values
and symbols of the cultural group at which it is directed.

Individuals learn about culture throughout their lives. The following two concepts are
important in terms of cultural learning:

Acculturation - is the process of learning and adopting host cultural norms, values and
beliefs.
Enculturation - refers to the process of learning our own (native) cultural norms and values
of a particular society are essential for an individual, to function in a society.

Subculture

A subculture is a distinct cultural group that exists as an identifiable segment within a larger,
more complex society. Members share similar patterns of behaviour that are distinct from
those of the main group. For example, your nationality may represent your overall culture.
At the same time however, you may be Catholic or Muslim, a hipster or a surfer, a rugby or
soccer fanatic.

Reference groups

Reference groups are individuals and groups of consumers that other consumers see as
knowledgeable about a specific topic. These individuals or groups might not necessarily be
as knowledgeable, but the opinions of consumers are subjective and when they view these
individuals as reference groups, they will influence consumer behaviour. Consumers will in
many instances take the advice of or copy the behaviour of these reference groups.

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 Normally, people want to be members of some group or other and in order to gain
acceptance will maintain the habits and purchasing patterns of the group. People normally
have several reference groups for different areas. Some they meet face-to-face, others they
may wish to imitate.

In either case, they may take values from these reference groups and make buying decisions
based on what the group might accept. Attraction refers to the desirability that membership
in a given group has for the individual. This can range from negative to positive responses.

In all reference groups there are instinctive norms of behaviour, and members are expected
to conform to these norms in order to avoid sanctions being applied against them.

A circle of friends, a social club and a work group are

all examples of reference groups. Choosing a typical
reference group to portray in an advertisement is
difficult, because what one person may regard as a
positive group with which to be associated, may well
be regarded by another as something to be avoided at
all costs.

Marketers use reference groups to lend credibility to products and services and help convince
potential customers to purchase the product. Celebrity product endorsements are a common
strategy used to sell products. Similarly, marketers may create advertising that implies that
your normative reference group prefers a particular product or service. For example, if you
are an aspiring cyclist and your cycling hero endorses a particular bike, you might very well
be more influenced by that ad than an ad that is simply about the product itself.

Family, households and social class

Family
Family is defined as two or more people related by blood, marriage or adoption who reside
together. (Boshoff,2017)

Of all the groups influencing buyer behaviour, in most cases the individual maintains the
closest contact with the family. In family interaction the child learns behaviour patterns by
means of the socialisation process.

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 With regard to the influence of the family, there
are 2 aspects that are important in developing
marketing strategies: the family life cycle and
role differentiation between family members.
The family as a decision-making unit appoints
members to decide about purchasing products
that will provide the greatest degree of need-
satisfaction for the family as a whole. Family
members have certain roles. Marketers have to
know the role structure of families in their target market, because the marketing message
must be based on such knowledge.

Here is a summary of the various role players in the family:

Role Description Example

Influencers Influence decisions A child who demands cereal
with a toy included in the
package
Gatekeepers Prevent certain decisions or A teenager refusing to eat
purchases being made unhealthy food
Deciders Make the final purchasing A mother that doesn’t want
decision her children to eat too
much sugar
Buyers Actually buy the product or The family member that
service does the shopping in store
or online
Preparers Prepare the product for The mother that cooks the
usage dinner for the family
Users Use the product that was The family that eats the
bought meal that was prepared by
the mother
Maintainers Maintain the product that The father that waters the
was purchased vegetable garden
Disposers Discard what remains of the The teenager that takes out
product the garbage and prefers a
specific type of garbage bag
that does not leak
Source: Boshoff, 2017

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 Family members may also share many attitudes and values, consider each other’s opinions
and divide various buying tasks. Although only one family member may go to the store and
make a specific purchase, when planning marketing strategies, it is important to know who
else may be involved. Other family members may have influenced the decision or really
decided what to buy. Still others may use the product. For example, a husband and wife may
jointly agree on many important purchases, but sometimes they may have strong personal
preferences. However, such individual preferences may change if the other spouse has
different priorities.

Family can influence the behaviour of consumers in many ways. One could be, that being part
of a family with established purchasing patterns would cause the consumer to continue with
the established patterns. For instance, if the person in the family who is normally responsible
for purchasing always purchases Lux soap, there is a chance that when an individual member
of the family starts their own purchasing, they will purchase the same brands. The stage at
which the consumer is in the family life cycle also has a large impact on consumer decision-
making. The family life cycle model illustrates the various stages and how they have changed
over the years.

Pester power is the ability of children to pressurize their parents into buying them products,
especially items advertised in the media. This is noteworthy for marketers as it results in extra
sales. Parents often give into pester power and spend more than initially planned. There is
however an ethical line when it comes to advertising to children. Many concerns are
expressed about pester power, including that it increases parent-child conflict.

The influence of the purchasing context on consumer

decision making
Purchase situation
The purchase situation can impact on the consumer experience both in the store and online.
A rude salesperson or a long queue can easily lead to a customer forming a negative attitude
both towards the store and towards the products that they purchased. In the same way, an
online store that makes the actual purchase difficult for the customer by only offering one
payment option could also affect their attitude towards the store.

Occasions
The purchase occasion will also influence the purchase decisions. If a consumer is purchasing
flowers for their home, they will probably spend less time choosing the flowers than if they
were purchasing them as a gift for their partner.

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 Topic 4:
Research and marketing decision making

Introduction
Welcome to Topic 4 of your consumer behaviour, research and marketing decision-making
express course.
Welcome to Topic 4 of your consumer
behaviour, research and marketing
decision-making module. Before you
can create your ingenious marketing
strategy that will yield the result you
are aiming for, you need to collect
insight into who your customers are,
what they like and dislike, what type
of media they consume, how much
disposable income they have and so
forth. This is called market research.

The American Marketing Association (AMA) defines market research as:

“The function which links the consumer, customer and public to the marketer through
information - information used to identify and define marketing opportunities and problems,
generate, refine and evaluate marketing actions, monitor marketing performance and
improve our understanding of marketing as a process.”

From this definition it is clear that market research is more than the mere analysis of rough
data. Rather, it is a chance for marketers to gain an extensive understanding of the
environments around their organisation and of course their customer behaviour.

Put differently, marketing research refers to the planning, collecting and interpretation of
data on marketing issues, which is converted into information that the organisation uses to
make marketing decisions.

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 The role and function of research in marketing decision
making
Research fulfils four functions in organisations; namely a foundational function, a testing role,
issue examination and performance monitoring.
A foundational function where it answers basic questions such as which consumer
segments are to be segmented and with what types of products.
A testing role which addresses things such as new product concepts or promotions and how
they affect the organisation.
Monitoring all levels and aspects of performance.
Examining issues that affect the organisation.

Marketing research plays a key role in the management of the marketing system by focusing
on three areas:
1. The descriptive role includes collecting and presenting factual statements (e.g. viewer
statistics of a particular programme).
2. The diagnostic role implies explaining data (e.g. using viewer statistics to explain
changing viewer preferences for particular content).
3. The predictive function is to address 'what if' questions (e.g. showing how a change in
content may be positive or negative).

Apart from these roles, marketing research also contributes to the marketing mix, the
organisations environment, identifying opportunities and treats and monitoring and
evaluation of marketing performance.

Marketing research and the marketing mix

The task of marketing managers is to create value for customers and to facilitate exchange
between seller and buyer. To create this value, they focus their efforts on the elements of the
marketing mix namely the 4Ps: product (or service), price, place or distribution, and
promotion or communications mix.

Marketing research can be used to assist marketing managers with decisions related to the
marketing mix as follows:

Product decisions include decisions related to the product name, packaging, concept testing
and new product development. Concept testing research exposes customers to a new
product idea to judge the potential acceptance and feasibility of the new-product concept.

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 Product testing reveals a product prototype's strengths and weaknesses or suggests whether
the finished new product can be expected to perform better than com-peting brands. Brand
name evaluation studies investigate whether a name is appropriate for a product. Packaging
testing assesses size, colour, shape, ease of use and other attributes. For example, if a
television network had the idea to introduce several new movie channels, the concept would
have to be tested among current and potential viewers (customers) to determine whether
the channels would be watched, whether they would be feasible and whether they would
enhance the network's brand.

Pricing decisions include research on price elasticity, market demand, sales potential and
forecasting. Research related to pricing considers the amount of economic cost that is
needed to represent what cus-tomers perceive to be value in a product. Pricing research
addresses consumer quality perceptions and reactions to low prices.

Distribution decisions include research on website testing, channel performance, market

coverage and exports. Distribution research Investigates the appropriateness of new retail
sites or warehouse locations. It is needed to understand retailers' and wholesalers'
operations and to learn about their reactions to a manufacturer's marketing strategies. For
example, the TV network needs to conduct research to find out where to locate its sites of
service delivery-within malls or as stand-alone sites where customers may be able to obtain
customer service.

Promotion or marketing communication decisions include research on media and

advertising copy effectiveness, sales force compensation and sales territories. Promotion
research investigates the effectiveness of advertising, premiums, coupons, sampling,
discounts, public relations and other sales promotions. Other research in this area includes
media studies which help organisations make decisions about whether television,
newspapers, magazines and other media alternatives are best suited to convey the intended
message. For example, although the TV network is able to advertise on its own channels, it
needs to find creative and effective ways to attract new viewers. This is often done through
street-pole advertising and newspapers. It needs to conduct research in order to make better
decisions regarding promotion in terms of what works currently and what new ways exist or
emerged recently to achieve its goals.

Marketing research and the business environment

The elements of the marketing mix are adjusted by marketing managers and therefore they
have some form of control over these elements. However, the environment in which the
organisation does business contains many uncontrollable factors (as discussed in Module 2).
This lack of control results in a need for information.

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 Identification of opportunity and threats

One of the most widely used approaches to detect market opportunity and threats is
situation analysis. The purpose of situation analysis is to identify and describe current and
future issues and key trends as these affect the organisation's business environment, which
consists of internal environment, the customer environment and the external environment.

The issues to consider (research) in the internal environment include the following:
• Who are our current and potential customers?
• What do customers do with our products?
• Where do customers purchase our products?
• When do customers purchase our products?
• Why (and how) do customers select our products?
• Why do potential customers not purchase our products?

The issues to consider in the external environment include:

• Competition.
• Economic growth and stability of Political trends.
• Legal and regulatory issues.
• Technological advancements.
• Socio-cultural trends.

Monitoring and evaluation of marketing performance

Effective monitoring and evaluation is critical in ensuring that any marketing strategy or
programme is successfully implemented. From a data collection perspective, it must be
decided what is to be evaluated, how it is to be evaluated, who is to supply the data and
when it is to be evaluated. A variety of different metrics or indicators can be used to measure
marketing performance and they can be classified as leading or lagging Indicators. Leading
indicators provide insight into future marketing performance and focus on measurements of
effectiveness. Lagging indicators are measurements of past performance that provide
information about how well the organisation has performed in the past. Thus, lagging
indicators are mainly concerned with issues of efficiency such as profitability and return on
investment (ROI) for marketing activity.

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 Marketing Information System (MIS)

Data are simply facts or recorded measures (i.e. raw or descriptive data) of marketing
activities or marketing events. Information is data structured or processed to facilitate
marketing decision making. Data and information (whether as primary or secondary data)
are often stored using a technology-based system referred to as a marketing information
system (MIS). An MIS (sometimes referred to as a marketing Decision Support System or DSS),
is an interactive, flexible, computerised information system that enables managers to obtain
and manipulate information as they make decisions.

Marketing information System can be defined as a set of inter-related components that

collect (or retrieve), process, store and distribute information to support decision making and
control in an organisation.

The ideal MIS is easy to use and provides quick results (interactive).
It analyses and manipulate data in different ways (flexible).
It helps marketers ask questions where the data can be managed to get the answer,
(discovery oriented) and
It is easy to learn how to use (accessible).

Information needs

The need for marketing information rises because of the changing nature of external forces
such as the following:

Knowledge of consumer demand. Marketers need a thorough, in-depth knowledge of and

insight into consumer needs, tastes, likes, dislikes, preferences and reactions to be successful.

Complexity of marketing. Marketing activities have grown and expanded, and decision
making has become complex. Marketing information is needed to understand these changes
to make sure that the organisation responds to them appropriately.

Changing economic circumstances. Continual shifts in national and international economies

influence supply of and demand for products and services. With a clear understanding of
economic development and timely data available, marketers are able to adjust the
organisation’s marketing strategies.

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 Changing competitive conditions. Almost all marketing efforts and activities are subject to
the changing forces of competition. A successful marketer is one who gauges correctly the
nature, extent and the impact of competition.

Technological advancement. New technologies make the rapid introduction of new ideas,
new products and new services possible. Keeping pace with technological change is a
requirement for all organisations because technologies have an impact throughout the
marketing system in shaping the availability, cost and final consumption of goods.

Primary and secondary data

There are many ways of classifying data. A common classification is based upon who
collected the data.

Primary data
Primary data is information specifically collected to solve a current problem and is collected
by means of applicable methods. It is usually by the researcher themselves for a specific
purpose. For example, data collected by a student for a thesis or research project.

Some advantages of using primary data:

• The researcher collects data specific to the problem under study.
• There is no doubt about the quality of the data collected.
• If required, it may be possible to obtain additional data during the study period.

Some disadvantages of using primary data:

• The researcher has to contend with all the hassles of data collection- deciding why,
what, how, when to collect.
• Getting the data collected (personally or through others) can be time consuming.
• Getting funding as research can be costly.
• Ethical considerations (consent, permissions, etc.)

Secondary data
Secondary data is information that has been collected or was published previously. It already
exists somewhere, having been collected for another purpose. It is obviously cheaper to
make exclusive use of secondary data sources, but this is not always feasible or possible. The
researcher needs to carefully consider the nature of the information needed before making
a decision. For example, census data being used to analyse the impact of education on career
choice and earning.

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 Some advantages of using secondary data:
• The data’s already there- no hassles of data collection.
• It is less expensive.
• The investigator is not personally responsible for the quality of data.

Some disadvantages of using secondary data:

• The investigator cannot decide what is collected.
• One can only hope that the data is of good quality.
• Obtaining additional data (or even clarification) about something is not always possible.

The marketing research process

The marketing research process defines the tasks to be accomplished in conducting a market
investigation. This includes problem definition, plan the design and gather secondary data,
specify the sampling procedure, collect primary data, analyse the data, and report generation
and presentation and follow up.

Below is a practical example of a research study that was conducted by Ipsos, one of the
largest market research company’s in South Africa. The purpose of the study was to measure
the influence that brands have on South Africans.

Read about the findings of the study in the following article and see the below practical
application of how the study may have moved along the research process.
http://www.bizcommunity.com/Article/196/19/184498.html

Market research projects are normally commissioned to a research company if an internal

research department is not available. It is important for the marketing manager to
understand the process in both cases, since they will play a significant role in the research
project.

This video describes the steps in the market research process as indicated in the above
model. Following the video, you will see an elaboration of certain terms below that have
been introduced in the video:
https://www.youtube.com/watch?v=XLFtr0GqtdE&feature=youtu.be

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 The marketing research process comprises seven stages:

Stage 6
Stage 3
Stage 1 Stage 2 Stage 4 Stage 5 Prepare
Specify Stage 7
Formulate Plan the Collect Analyse and
sampling Follow-up
problem design data data present
procedure
findings

Here is an example of how each stage can be applied:

Stage 1: Identify and formulate the problem or opportunity. Ipsos wanted to understand
the influence that brands have on South Africans.

Stage 2: Plan the research design and gather secondary data.

Before conducting the research, Ipsos would have planned the research study and thoroughly
investigated any secondary sources of data.

Stage 3: Specify the sampling procedure.

The sample was randomly selected and interviewed face-to-face in their homes and home
languages. Interviews were conducted nationwide from metropolitan to deep rural areas.

Stage 4: Collecting Data.

Fieldwork for this study was conducted from April to June 2018. A total of 3619 adult South
Africans, 18 years and older were interviewed.

Stage 5: Analysing data.

The data was analysed on many levels including the use of cross tabulations, measures of
association and regression analysis.

Stage 6: Preparing and presenting findings.

The findings were prepared and presented in PowerPoint as well as through the use of an
infographic.

Stage 7: Follow-up.
The research will be conducted on an annual basis to measure changes over time.

The market research process begins with the identification of a problem faced by the
company. The clear-cut statement of the problem may not be possible at the very outset of
research process because often only the symptoms of the problems are apparent. This is an
important stage in marketing research because research is a costly process involving time,
energy and money. If the problem is not clearly defined upfront, resources could be wasted
by focusing in the wrong direction.

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 A clear definition of the problem helps the researcher in all subsequent research efforts
including setting of proper research objectives, the determination of the techniques to be
used, and the extent of information to be collected. When taking the first step it is important
not to confuse a symptom with the real problem. For example: A drop in sales could be a
symptom of a whole host of problems. Like new competition, unfriendly staff or even a lack
of stock in store.

The research design is the plan to which the research investigation will be
conducted and can include:
Quantitative research seeks information among a larger group of respondents, the findings
of which can be quantified through statistical data summarised in numbers, like percentages
and averages. The questionnaire used for data collection mainly consists of structured
responses like rating scales, ranking questions, closed questions like “yes” and “no” answers
and provides categories of answers with mutually exclusive answers.

Qualitative research refers to gathering of information among smaller groups of respondents

and seeks in-depth responses, which require probing questions through selective guidance,
which should not be influenced by the researcher. The aim of this research is to obtain
information on feelings, attitudes and emotions and gain better insight into the research
problem. It is possible to ask in-depth questions and find answers to more complex and
problematic research questions.

There are four types of research designs that can be used:

The exploratory research design is conducted when more information is needed about a
problem, opportunity or phenomenon. For example, some companies started to realise that
traditional marketing channels were becoming less effective with their target markets. So,
they had to explore how to communicate with them more effectively.

The descriptive research design is conducted when knowledge about a market or other
marketing aspect is vague. For example, a coffee company may decide to start targeting a
market in San Francisco. They are aware that the target market consists of heavy coffee
drinkers, but they know little about their lifestyle. The marketer would need to understand
the coffee culture and the motivations that drive this culture in San Francisco.

The causal research design is conducted to measure cause-and-effect relationships. For

example, do more likes on Facebook lead to more sales?

Predictive research design is conducted to forecast future values. For example, sales, market
share and retail orders. Political pollsters use predictive research to predict how many people

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 will vote for them. Many political parties use mobile phones to ask their target market who
they will be voting for. Once the marketer has decided on the types of research design, they
will determine the data needs and assess whether to use primary or secondary data or both.

The next step in the research design is to determine the data sources:
Primary data sources can be internal such as an interview with the organisation’s employees
or external such as research conducted with consumers, clients, retailers, wholesalers,
competitors or suppliers.

Secondary data sources can include government, census recordings, research conducted by
independent research companies, articles, publications and research findings provided by
governing bodies.

Primary data can be collected by four methods namely:

Observational research
Includes watching people and situations and recording behavioural patterns in order to
better understand the activities, attitudes and opinions of a target market. An example of
observational research is a study where the researcher visited a college bar to gain an
understanding of how the influence of peers affected the students’ choice of beer brands.
The researcher posed as a customer and simply observed the students and how they went
about selecting the beer brand of their choice.

Experiments
Is a controlled study in which a researcher actively manipulates one or more experimental
variables. These variables include product features, price levels and advertising levels or
advertising appeals. The effect of these manipulations is then measured on one or more
dependent variables of interest. Dependent variables can be measured by either observation
or self-report. Since the purpose of an experiment is to isolate the effects of the manipulated
variable(s), experiments are useful only to the extent that the effects of other variables can
be controlled or eliminated. However, this is very difficult to do in real market-place situations
where competitors actions are uncontrolled. Also, it may not be feasible to perform certain
manipulations in a real environment.

For example, it is not practical to test the effects of a product’s features by changing the
product from market to market. In order to improve control or facilitate feasible
manipulations, experiments are often undertaken as laboratory studies rather than field
studies. A laboratory refers to any controlled environment. For example, if customers were
invited to a research facility where they express their preferences for products with
manipulated features, this would be classified as a laboratory study.

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 Focus groups
Are groups of consumers who are included in an open, in-depth discussion rather than simply
asking questions to solicit participant responses. The facilitator leads the discussion and
seeks to find detailed information on the emotions, feelings and attitudes of respondents on
the specific problem or topic. This group normally consists of 6 to 8 respondents and because
focus groups tend to have small sample sizes, they have limited population coverage. In
addition to generating new ideas, organising a focus group is an excellent method of initially
screening new ideas and concepts.

For example: An online qualitative research company,

FocusVision InterVu™ offers the technology needed to
conduct online focus groups, cutting down on time and
costs.

Watch this video:

https://www.youtube.com/watch?v=PG8RZl2dvNY

Surveys
These are personal interviews conducted face-to-face, telephonically or via computers with
respondents who represent the target market. Internet surveys are growing in popularity as
technology provides more and more solutions to the problems associated with this
technique. Systems such as Computer-Aided Telephone Interviewing (CATI) offer the user an
automated sampling and dialing procedure, scrolled questions on a computer screen and
almost immediate data analysis. A consumer panel is a group of consumers who provide
information on a continuing basis. The panel’s behaviour is analysed through purchasing
decisions and feedback although the panels do not necessarily come in contact with the
researchers. These consumer panels are especially useful for testing the impact and success
of marketing efforts.

For example, if a sales promotion campaign is launched to encourage consumers to purchase

more of a certain product, the purchasing behaviour of the consumer panel could be
analysed to determine if the campaign was successful or not. The consumer panel is very
carefully selected to represent the consumers in the target market.

Data collection instruments

The data collection method used in the research often determines the instrument used. The
most common instruments are questionnaires and electronic or mechanical equipment such
as cameras. With the design of a questionnaire, careful consideration must be given to the
type of questions, the format, wording and sequence.

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 The questions should be relevant and easily understood by the respondents. The questions
can be open-ended, in which case the respondents reply in their own words or closed where
the respondents select one or more alternative responses listed in the questionnaire.

The wording of the questions and instructions needs to be simple, unambiguous and direct.
The sequence of the questions also has to be considered when structuring the questionnaire.
The pre-testing of a questionnaire is always strongly recommended in order to confirm that
these considerations have been correctly implemented and to make adjustments if
necessary.

A toothpaste company in South Africa wanted to better understand the rural market. In their
questionnaire, they asked the question,” How often do you brush your teeth?” The
predominant answer was “never”. Interestingly the reason the respondents claimed to never
brush their teeth was because they use the word “wash” and not “brush” to describe teeth
cleaning. It’s easy to see how the outcome of the research could have been misleading.

The sampling plan

The final step in the research design is the sampling plan. This is when we ask the question,
whom do we want to study? Simply put, a sample is a segment of the population selected to
represent the population as a whole.

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 The population among which research will be
conducted includes the total group of people
the researchers are interested in. It is, however,
impossible to gain research information from
every member of the population. It is for this
reason that a sample, including those
individuals from the population of interest, is
chosen as the subjects in an experiment or to be
the respondents to a survey. There are various
sampling methods available to researchers, but
for the purpose of this course we only focus on
random and non-random sampling.

Random sampling
With random sampling, each member of the population has the same chance of being
included in the sample. With simple random sampling, population members are numbered,
and random members are drawn to determine which members are selected. With systematic
sampling, a random start is followed by a predefined number of the population.

Here’s a video explanation of simple random sampling presented by Rahul Patwari.

https://www.youtube.com/watch?v=-BRoHNiRM-o

Cluster sampling is used when the studied population is spread across a wide area in such a
way that simple random sampling would be difficult to implement in accessing the selected
sample. The researcher will divide the population up into a set of different coherent areas
and then randomly select areas to assess.

See the video explanation of cluster sampling. https://www.youtube.com/watch?v=QOxXy-

I6ogs

Stratified sampling is used when there are smaller sub-groups that are to be investigated. The
researcher wants to achieve greater statistical significance in a smaller sample to reduce
standard error. The researcher will divide the population up into a set of smaller, non-
overlapping sub-groups (strata) and then do a simple random sample in each sub-group.

Strata can be natural groupings, such as age ranges or ethnic origins.

See the video explanation of stratified sampling.

https://www.youtube.com/watch?v=sYRUYJYOpG0

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 Non-random sampling
This is any sampling method where some elements of the population have no chance of
selection or where the probability of selection cannot be accurately determined. An example
of non-random sampling is convenience sampling. Here the samples are selected because
they are accessible to the researcher. Subjects are chosen simply because they are easy to
recruit. This technique is considered easiest, cheapest and least time consuming but not the
most accurate.

Quota sampling is used when you know that the proportions of particular sub-groups within
a population and you want to ensure each group is proportionately represented. The
researcher will decide how many people they need to sample and then use whatever
methods they can to access the desired sample size. For example, a researcher wants 100
opinions about a new style of cheese. They set up a stall at the market and canvass passers-
by until they have 100 people to taste the cheese and complete the questionnaire.

Judgment sampling involves selecting a group of people because they have particular
behavioural characteristics that the researcher wants to study. This type of sampling
technique is also known as purposive sampling and authoritative sampling. For example, the
researcher may select a group of people that are frequent users of a specific service.

Snowball sampling is used when the researcher does not have access to sufficient people
with the characteristics they are seeking. The researcher would find people to study and then
those respondents to refer them to other people who fit the study requirements. This
method is repeated until the researcher has reached the desired sample size.

Collect, process and analyse the data

During this step quality control is critical as inaccurate or misinterpreted information is fairly
common. Clear instructions and relevant motivational and training methods need to be used
to avoid interviewer cheating and encourage cooperative and honest field workers.

Communicate information to the marketing decision maker

All of this hard work will be to no avail if it is not effectively communicated to the actual
person or department responsible for acting on the key findings and recommendations.
Remember, great ideas come from great insights!

Research must be ongoing and especially in this digital age, excuses like it’s too expensive
and time consuming no longer hold true.

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