POSTGRADUATE INSTITUTE OF MANAGEMENT

University of Sri Jayewardenepura

Master of Business Administration
MBA 504: Marketing Management

1. Defining Marketing for the New Realities – Chapter 1

2. Marketing Planning & Management – Chapter 2
3. Consumer Buying Behavior & Profiling The Sri Lankan Consumer – Chapter 3 & PIM Publication
4. Conducting Market Research – Chapter 5
5. Identifying Market Segments & Target Customers & Crafting the Brand Positioning – Chapters 6 & 7
6. Designing & Managing Services – Chapter 9
7. Building Strong Brands – Chapter 10
8. Managing Marketing Communication & Designing an IBC in the Digital Age – Chapter 12 & 13
9. Channels & Distribution Strategies – Chapter 15 & 16
10. Revision & Discussion
Dr Asanga Ranasinghe
Consumer Behavior
• Consumer behavior is the study of how individuals, groups & organizations select, buy, use & dispose
of goods, services, ideas, or experiences to satisfy their needs & wants
• Consumer behaviour help marketers in
o Identification & understanding of customers/ consumers
o providing insight concerning how to make them to consume more
o providing insight to predict future buying behaviour & assess effectiveness of marketing efforts
• A consumer is someone who derives satisfaction or benefit offered by a product or service through
experience.
• Adopting a holistic marketing orientation requires understanding consumer
insights fully (pain points) so the right products are always marketed
to the right customers in the right way.
• Consumer buying behavior is influenced by the
following factors:
o Cultural
o Social
o Personal
Dr Asanga Ranasinghe
Factors Influencing Consumer Behavior
Culture
• Culture is the sum total of learned beliefs, values & customs that serve to direct the consumer behaviour.
• Culture is the fundamental determinant of a person’s wants based a set of values, perceptions,
preferences, & behavior
• Each culture consists of smaller subcultures due to nationalities, religions, racial groups & geographic
regions
• Marketing for sizable subcultures through careful marketing research lead to multicultural marketing.
• Within cultures there are also social classes.
o Social classes are relatively homogeneous & enduring divisions
in a society & whose members share similar values,
interests & behavior
o Those within each social class tend to behave more alike
o Social classes show distinct product & brand preferences
if marketed well

One classic depiction of social classes in the United States defined seven
ascending levels: (1) lower lowers, (2) upper lowers, (3) working class,
(4) middle class, (5) upper middles, (6) lower uppers, & (7) upper uppers.
Dr Asanga Ranasinghe
Factors Influencing Consumer Behavior
Social Factors
1. Reference groups
• Consist of all the groups that have direct/ indirect influences on a person
o groups having direct influence is called a ‘membership group’, known as primary group (family, friends, neighbors, co-
workers etc.)
o some people belong to secondary groups (religious, professional or trade union groups) have an indirect influence

2 Family
• Most important consumer buying organization in the society
• Can distinguish between 2 families in the buyer’s life
o family of orientation: parents & siblings
o family of procreation: spouse & children who will more directly influence everyday buying behavior
• Buying patterns also vary with gender, women are becoming an economic force in Asia

3. Roles & Status

• People choose products that reflect & communicate their role & status
• A role consists of the activities a person is expected to perform & each
role carries a status.
Dr Asanga Ranasinghe
Factors Influencing Consumer Behavior
Personal Factors
1. Age & stage in the life cycle
• Consumer taste in food, clothes, furniture & recreation is related to our age.
• Consumption is also shaped by the family life cycle & the number, age, &
gender of people in the household at any point in time.

2. Occupation & economic circumstances

• Product & brand choice are affected by economic circumstances - spendable
income, savings & assets, debts, borrowing power & attitudes toward spending & saving.

3. Personality & self concept

• Occupation influences consumption patterns.
• Consumers often choose & use brands with a brand personality consistent with their actual self concept

4. Lifestyle & values

• People from the same subculture, social class, & occupation may adopt quite different lifestyles.
• Lifestyles are shaped partly by whether consumers are money constrained or time constrained
• Marketers search for relationships between their products & lifestyles.
• Marketers can target consumer values by appealing to their inner selves to influence purchase behaviour.
Key Psychological Processes Motivation

Model of Consumer Behavior Learning

Perception
Memory

Dr Asanga Ranasinghe
Key Psychological Processes Motivation

Motivation Learning
Perception
• A need becomes a motive when when aroused to a level of action
Memory
• Motivation has 2 dimensions
1. direction – goal selection (one over the other)
2. intensity – rigor of persuasion
• As per Maslow’s theory, human needs
are arranged in a hierarchy from most
to least pressing

In-depth motivational research on

product meaning to different
segments of passengers helped
Boeing design its 787 Dreamliner.
Maslow’s Hierarchy of Needs
Dr Asanga Ranasinghe
Key Psychological Processes Motivation

Perception Learning
Perception
• This is the process by which consumers select, organize & interpret
information inputs to create a meaningful picture of the world Memory

• People perceive the same object differently because of 3 perceptive processes

1. Selective attention – a process of screening out the clutter

o People are more likely to notice stimuli that relate to a current need
o People are more likely to notice stimuli they anticipate
o People are more likely to notice stimuli whose deviations are large

2. Selective distortion – a process of interpreting based on prior brand & product beliefs
& expectations
The size & shape of the
o works for the advantage of strong brands glass & the colour & smell
of the liquid are all cues
3. Selective retention – a process of remembering only the information that support the which may affect consumer
perceptions & evaluations
attitudes & beliefs
when drinking a glass of
o marketers need to use repetition to make sure the orange juice.
message is not overlooked
Dr Asanga Ranasinghe
Key Psychological Processes Motivation

Learning Learning
Perception
• Learning induces changes in our behavior arising from experience.
Memory
• Learning is produced through the interplay of
o stimulus - response cycles
o drives – a strong internal stimulus impelling action
o cues – a minor stimuli that determine when, where and how a person responds
o reinforcement - desired knowledge structures for repeated response
• Learning must be used by marketers to build demand by associating with strong drives, using
motivating cues, and providing positive reinforcement

Memory
• All the information & the experiences consumers encounter, end up in their memory
• The role of marketing is to make sure that consumers have the right product & service experiences to
create the right brand associations & maintain them in their memory
• Brand associations are brand related thoughts, feelings, perception, images, beliefs, & attitudes about
the brand in the memory of consumers
Dr Asanga Ranasinghe
The Buying Decision Process: The Five- Stage Model
Problem recognition
• Buying process starts when buyers recognizes a problem or feel a need.

• Needs could be triggered by internal or external stimuli.

• Marketers need to study consumers behavior & prepare strategies to meet

already triggered needs or trigger new needs.
o Important to drive discretionary purchases such as luxury goods, vacation
packages, entertainment options etc.

CoverGirl is one of P&G’s most

digitally supported brands, recognizing
the high level of consumer involvement
& the need to stay up to date, the
company engages consumers at every
stage of the buying process via mobile
marketing through targeted ads & a 5 Stage Model of the
microsite with experts’ tips & video on Consumer Buying Process
proper application & benefits.
Dr Asanga Ranasinghe
The Buying Decision Process: The Five- Stage Model
Information search
• Of key interest to the marketer are the major information sources to
influence through an integrated marketing program

• 4 groups of information sources

1. personal – family, friends, neighbors, acquaintances (most effective source,
performs legitimizing or evaluation function)
2. commercial – advertising, websites, salespersons, dealers, packaging,
displays (marketer dominated, mostly used by consumers)
3. public – mass media, consumer rating organizations
4. experiential – handling, examining, using the product

• Relative amount & influence of these sources vary with the product
category and buyer’s characteristics 5 Stage Model of the
Consumer Buying Process
Dr Asanga Ranasinghe
The Buying Decision Process: The Five- Stage Model
Information search
• In information search buyer go through an elimination process among
competing brands.
• There are 5 sets of brands involved in consumer decision making.

Successive Sets
Involved in Consumer Decision Making

• Marketers need to identify the hierarchy of attributes that guide consumer

decision making- market partitioning in each of the choice sets & try to
influence the decision making 5 Stage Model of the
Consumer Buying Process
• Must also look at other brands in each of the sets & plan competitive appeals.
Dr Asanga Ranasinghe
The Buying Decision Process: The Five- Stage Model
Evaluation of alternatives
• Consumers form judgments in evaluating alternatives largely on a
conscious & a rational basis.

• consumer is trying to satisfy a need through brand benefits.

• consumers sees each brand offering a bundle of attributes with varying
abilities to deliver the benefits.
• consumers will pay the most attention to attributes that deliver the sought
after benefits.

• Marketing programs must position brands to clearly differentiate in one

or more of the sought after benefits.

• Through learning & experience consumers acquire beliefs & attitudes

which influence the evaluation of alternatives
5 Stage Model of the
Consumer Buying Process
Dr Asanga Ranasinghe
The Buying Decision Process: The Five- Stage Model
Purchase decisions
• Consumers in this stage form preferences among brands in the choice set
with an intention to buy the most preferred brand.
• In executing the purchase intention, the consumer make up to 5 sub
decisions
1. Brand
2. Dealer
3. Quantity
4. Timing
5. Payment method

• Even if consumers form an evaluation, 2 general factors can intervene

between the purchase intention & the purchase decision.
1. Situational factors
2. Attitude & opinion of others
Steps between 5 Stage Model of the
Evaluation of Alternatives & a Purchase Consumer Buying Process
Decision
Dr Asanga Ranasinghe
The Buying Decision Process: The Five- Stage Model
Post purchase behavior
• Marketers must monitor following actions
1. Post purchase satisfaction
o Is a function of the gap between consumer’s expectation & product’s perceived
performance
o Loyalty is a direct function of satisfaction
o Consistent delivery of “the promise” & the brand image improve satisfaction &
thereby brand loyalty.

2. Post purchase actions

o Consumers who are satisfied will continue to buy & be word of mouth brand
ambassadors.
o Dissatisfied consumers can take private or public action.
– Private action can be exit option or voice option
– Public action can be complaining to a third party including legal action

3. Post purchase use & disposal

o Brand usage has to be monitored in terms of consumption rate & frequency of
purchase 5 Stage Model of the
o Marketing programs must be carried out to educate consumers to use more & use Consumer Buying Process
more frequently. Dr Asanga Ranasinghe
Moderating Effects on Consumer Decision Making
• There are 2 factors that determine the manner & path by which a consumer moves through the 5 step
model
1. Low –involvement consumer decision making
o Happens when consumers do not follow the 5 stage path due to
▪ Lack of motivation – does not want to evaluate a brand in detail
▪ Gaps in ability – gaps of product (or service) knowledge in memory
▪ Lack of opportunity – no sufficient time and proper setting
o Happening in buying low cost/ frequently purchased products – soap, washing powder, salt, bottled water

o Marketers use 4 techniques to influence the process

1. Link product to an engaging issue – toothpaste to avoiding cavities
2. Link product to a personal situation – fresh milk for growing kids
3. Link advertising to trigger emotions – living longer
(to be a strength for the family)
by eating healthy food – cereals
4. Add consumer important features to product – “fortified with vitamins” story in kids yogurt
Dr Asanga Ranasinghe
Moderating Effects on Consumer Decision Making
• There are 2 factors that determine the manner & path by which a consumer moves through the 5 step
model
1. Low –involvement consumer decision making

2. Variety– seeking buying behavior

o Low involvement despite significant brand differences due to eagerness for brand
switching (for the sake of variety as opposed to dissatisfaction) – biscuits
o Marketers use the following techniques to protect the consumer franchise
▪ Offering a range within the brand – toothpaste colors & flavors
▪ Dominating shelf space & avoiding out of stock situations
▪ Impactful & memorable sponsorships - sports sponsorships of Cola brands
▪ Reminder advertising – frequent exposure & repetition of advertisements
▪ Pricing cutting – often by challenger brands
▪ Deals & promotions – a tool adopted by challenger brands to induce trial
▪ Advertising that tries to break the consumer's purchase & consumption cycle &
present reasons for trying something new

Dr Asanga Ranasinghe
Profiling the Sri Lankan Consumer
• The ”new Sri Lankan consumer” has evolved rapidly in the recent times mainly due to the following
factors:
o trade liberalization & the adoption of an open economy approach since 1977.
o fast digitalization with smart phone usage & internet penetration growing by the day.
o demographics shifts & the undeniable changes in the socio-cultural fabric of the country.
• Marketers must swiftly identify the behavior of the new Sri Lankan consumer & align strategies with
customer-centricity as the cornerstone of successful business planning.
• In this evolving landscape, businesses cannot be viewing
marketing as only “selling” - trying to get the consumer to “buy”.
• Marketing must be treated as a philosophy bult on “sensing”
the consumer needs & “responding” with offerings that meet those needs.

• There are 4 personas of the Sri Lankan consumer as follows:

1. Composite Man
2. Economic Man
3. Social Man
4. Cultural Man
Profiling the Sri Lankan Consumer - Consumer Personas
Mod-Tradi New Urban Marketing
Adaption Middle Class (NUMC)
Opportunity
Traditional Middle Traditional Middle
Class 1 (TMC) Class 2 (TMC)
Cultural
Economic Man Social
Man Cultural Changes Man
Alienated Rural
Economic Changes New Working Social Changes
Youth (ARY)
The changes in income, Class (NWC) The changes in social
expenditure & employment structure along with
along with changes in the changes in the family
family lifecycle Traditional Working lifecycle
Class (TWC)

Age
The Cultural Man is shaped by the evolution
of the Composite Man, along with changes in
Composite Man
the Economic and Social Man Family Lifecycle Changes
Dr Asanga Ranasinghe
 Profiling the Sri Lankan Consumer - Pen portraits of Consumer Personas
The Composite The Economic Man The Social Man The Cultural Man
Man
Examines the family Defines unfolding patterns in Exhibits the changing social Displays the evolving
life cycle, influenced income, expenditure, and conditions in the country & the landscape of cultural &
by several trends: employment. evident social and spatial religious, in relation to
• aging population disparities. family & values, which are
Heavily influenced by the advent of
• rising Singulate either reinforced or
the service industry in the country.
Mean Age at Key groups include the New challenged.
Marriage Reflected in a relatively higher Gini Urban Middle Class, Traditional
Addresses cultural & social
• increasing Coefficient of Mean Household Middle Class, New Working
preference among migration & how consumers
Income & a high Food Ratio & an Class, Alienated Rural Youth &
women to remain cope with resulting stress,
adverse Poverty Headcount Index Traditional Working Class.
single substance abuse, sexual
as dependents.
• households being Exhibits a dominant household relationships, demands of
headed by females Shows a notable growth in expenditure with a tertiary education &
(single parent) telecommunications services, predominant male inclusivity, alongside the
Focuses on the insurance & bank deposits. participation in the labor force, emerging trend toward
evolving family life mostly in the private sector. convenience foods.
Drives opportunities for consumer
cycle to identify gaps personification. Identifies sub personas for STP. Emerges with the shaping by
in consumer needs. other personas.
Dr Asanga Ranasinghe
 The 4th edition of Profiling the Sri Lankan Consumer This evolution is characterized by
- Contemporary Realities & Evolved Behaviours distinct consumer personas:
unveils the new Sri Lankan Consumer depicting a Composite Man, Economic Man,
Profiling the journey of transformation & opportunity. Social Man, and Cultural Man.
Sri Lankan Composite Man is characterised by changing family structures influenced by demographic
Consumer trends. With an aging population projected to reach 28.1% by 2050 & a rising average age at
marriage (27.2 for males & 23.4 for females), family dynamics are shifting. Notably, 25.3%
Economic Man – a persona of households are now female-headed, reflecting broader social changes.
that highlights the financial
landscape, where the mean Social Man who emerges from these economic conditions & reveals distinct social classes viz
monthly household income the New Urban Middle Class, Traditional Middle Class, New Working Class, Alienated Rural
stands at Rs. 76,414 while the Youth & Traditional Working Class. Each class exhibits unique aspirations & challenges,
median household income influencing their interactions within society.
stands at Rs 53,333. This Cultural Man – a persona that synthesizes these influences, shaped by evolving cultural
figure underscores economic values & social migration patterns. This persona grapples with modern challenges such as
disparities, as indicated by a substance abuse & educational demands while seeking greater cultural engagement through
Gini coefficient of 0.46. The increased disposable income.
service industry plays a
pivotal role in shaping Economic Man & Social Man collaboratively Question
consumer behaviour, with contribute to the nation's cultural tapestry,
Discuss each of the 4 personas of the Sri
notable growth in among today's youth evolving through the
Lankan Consumer in relation to exploiting
telecommunications & interconnected composite man a figure that
a relevant marketing opportunity in a
banking. subtly aids the developmental trajectory. chosen category in Sri Lanka
Summary
• Consumer behavior – influenced by 3 factors
o Cultural (culture, subculture, social class)
o Social (reference groups, family, social role, statuses)
o Personal (age, stage in the life cycle, occupation, economic circumstances, lifestyle, personality, self
concept)

• The main psychological processes that affect consumer behavior are motivation, perception,
learning & memory
• Buying decision process consist with 5 stages:
1. Problem recognition
2. Information search
3. Evaluation of alternatives
4. Purchase decision
5. Post-purchase behavior
• Depending on the level of involvement & variety seeking buying behavior, consumers alter the
manner & path they go through the decision process.
• There are 4 personas of the Sri Lankan consumer – Composite Man, Economic Man, Social Man &
Cultural Man of whom marketers need to understand & profile.
Dr Asanga Ranasinghe