Consumer Research: Literatur Review, Statement Analysis and Focus Groups

Content

Literature Review: ‘ Consumer Perceptual Processes ’

Statement Analysis : ‘ As a part of our marketing strategy we introduce new products very frequently ’

Focus Groups: Applied Example

References

Submission date: 22 May 2007

PART ONE

Literature Review on ‘Consumer Perceptual Processes’

In terms of consumer research, it is often the key purpose to outline the value in a product or service, customers perceive. The author will concentrate, due to the limited scope of the study, on perception in marketing terms and particular ‘customer perceived value’. Therefore, it is important to firstly define the term ‘value’ and ‘perception’ to provide the reader a more holistic view of the subject area. The second part of the literature review, provides the reader with an up-to-date account to understand the importance of customer perception for any marketing approach. The final part of the literature review discusses and contrasts the topic in question from different viewpoints.

Values in general can be defined as “an enduring belief that a specific mode of conduct or end-state of existence is personally or socially preferable to an opposite mode of conduct or end-state of existence.” (Rokeach, 1973, p. 159) Furthermore, he argues that values can be seen as determinants that are considerably or rationally related to features, ideologies and social behaviour. According to Bhate (Lecture Notes, 2007), perception can be defined as “the process whereby the stimuli are received and interpreted by the individual and translated into a response” or “whereby an individual becomes aware of his or her environment and interprets it so that it will fit into his own frame of reference.”

In general, it must be stressed the way people perceive their external and internal environment, determines to a great extent their personal behaviour. It can be distinguished between two kinds of variables; the physiological and the learning variables. An example can be given by the perceptual experience of seeing a bird sitting in a tree, which involves the physiological condition of the eyes. If this function would be limited (nearsighted or colour blind), it might not be possible to see the bird or the colour of the tree. Learning variables allow people to enter their past experiences and thus permit the identification of the object as a bird and the colour of tree as green and brown. (SFSU, 2007) Furthermore, it can be said that another variable in perception is the personal value system, which can be grouped in the learning variables as it is influenced strongly by culture, behavioural experiences, education, stratum etc. However, it is crucial to keep in mind variations that might affect variables of perception, such as hunger, love, pain, loneliness. We can identify two types of perceptual determinants; autochthonous and behavioural. Autochthonous determinants reflect therefore “directly the characteristic electrochemical properties of sensory and organs and nervous tissue”, where we can “account for phenomena like simple pair formation, closure, and contrast, or at another level, tonal masking, difference and summation tones, flicker fusion, paradoxical cold, and binaural beats”. (Bruner and Goodman, 1947) Behavioural determinants on the other hand, we can group adaptive and active functions of the organism, leading to “the governance and control of all higher-level functions, including perception: the laws of learning and motivation, such personality dynamics as repression, the operation of quasi-temperamental characteristics like introversion and extraversion, social needs and attitudes”. (Bruner and Goodman, 1947)

According to Solomon et al (2006, p.97) it is crucial to classify consumer needs in order to analyse their behaviour. Therefore, motivational approaches in consumer buying behaviour become of particular importance. Motivation is described by Buchanan and Huczynski (2004, p. 873) as “the cognitive, decision-making process through which goal-directed behaviour is initiated, energized, and directed and maintained.” It can be summarised that “individuals with a high need for achievement strongly value personal accomplishment” by often purchasing products of premium quality as they reflect the consumers’ personal goals and provide indication of their achievement. (Solomon et al, 2006, p. 98) This theory reveals particularly to perception as consumers must perceive high value, importance or necessity in order to be motivated to purchase something.

Another very important motivational approach was made by Abraham Maslow. He formulated a hierarchy of biogenic and psychogenic needs, where one level must be reached before the next one acts as a motivator (see Appendix 1). Even though, this theory relates only indirectly to consumer behaviour, marketers state that it “specifies certain types of product benefits people might be looking for, depending on the different stages in their development and / or their environmental conditions.” (Solomon et al, 2006, p.98) Each stage of the hierarchy identifies different benefits a consumer is looking for in a product, but each must be satisfied before progressing on the hierarchy. Therefore, consumers appreciate the products which are presently accessible for them.

Stefanou (1993, p. 294) said that first of all there is a need to understand what motivates consumers when making their buying decisions in order to fulfil their needs and wants.

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Figure 1: Stages in the consumer buying decision process

(Source: Stefanou, 1993, p. 294)

Figure 1 shows all the considerations that arise when a consumer faces a new and complex purchase situation. Consumers often skip or reverse some of these stages when it comes to routine purchases or they are emotionally attached to a certain product. (Stefanou, 1993, p. 294) Nevertheless, buying decisions depend on a very multifaceted interaction of “cultural, social, personal and psychological factors” (Kotler et al, 2001, p.211).

According to Solomon et al (2006), people are always taking in information, but only a small number of stimuli attract our attention, but those which do enter people’s consciousness are mostly not processed objectively and are rather interpreted by each individual. Therefore, the process involved in consumer perception can be divided in “three stages of exposure (or sensation), attention and interpretation make up the process of perception.” (Solomon et al, 2006, p. 36) Whereas sensation refers to the direct reply of our sensory receptors, perception is the process by which these stimuli are organised, selected and interpreted.

By reviewing literature about customer perception, the author can outline that the emphasis on perceived value lead back to studies of product quality, followed by studies of customer satisfaction. (Snoj et al, 2004)

Among others, Erdem et al (1999, p.137) state that marketing is particularly affected by consumers’ personal values and their perception in terms of understanding and explaining customer behaviour. In order to maintain a long lasting relationship with consumers and to achieve a high level of customer loyalty to a company, businesses and specifically marketers have to consider consumers’ perception while developing their marketing approach. (Berry, 1983, cited by Fandos Roig et al, 2006, p. 266)

Philip Kotler, one of the world’s leading strategic marketers and his co-author Kevin Lane Keller refer in their book ‘Marketing Management 12e’ (2006, p.141) to customer perceived value as ‘CPV’ and state that customers in the 21st century have more sources to educate and inform themselves about a product’s possible alternatives in order to assess which product will deliver the highest level of perceived value to them. Furthermore, they argue that, the higher level of satisfaction gained from a certain product, the more likely it leads towards a repetitive purchase.

Whereas Schechter (1984, cited by Snoj et al, 2004) provides a more descriptive definition of ‘perceived value’, by saying “it is composed of all factors: qualitative and quantitative, objective and subjective, that jointly form a consumer’s buying experience.”, Anderson and Narus (1998, cited by Snoj et al, 2004) go more in detail and refer to it on a ‘business to business’ basis. They describe customer perceived value as “perceived worth in monetary units of the set of economic, technical, service, and social benefits received by a customer’s firm in exchange for the price paid for product’s offering, and taking it into consideration, the available alternative of supplier’s offerings and price.”

Furthermore, Caruana et al (2000) stress that a lot of times it is the perception is about the features that customers receive out of a product, which in combination produces value, by considering all relevant costs and benefits. Therefore, it can be argued that positive perceptions intensify value whereas more sacrifices tend to reduce value.

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