Consumer behaviour and a European perspective

Table of Contents

1. Introduction
1.1 Introduction to Customer Behaviour:
1.2 European Perspective
1.3 Euro’s Impact

2. Characteristics of European Consumers
2.1 Perception
2.2 Learning and Memory
2.3 Motivation and Values
2.4 The Self
2.5 Personality and Lifestyles
2.6 Attitudes
2.7 Attitude Change and Interactive Communications

3. Decision Making Process
3.1 Individual Deciding
3.2 The Purchase Situation, Post-purchase Evaluation and Product Disposal
3.3 Group Influence in Decision Making
3.4 Family Decision Making

4. Global View of Consumer Behaviour
4.1 Income and Social Class
4.2 Ethnic and Regional Subcultures
4.3 Age Subcultures
4.4 Cultural Influences on Consumer Behaviour
4.5 The Creation and Diffusion of Culture

5. Summary

References

1. Introduction

1.1 Introduction to Customer Behaviour

One "official" definition of consumer behavior is "The study of individuals, groups, or organizations and the processes they use to select, secure, use, and dispose of products, services, experiences, or ideas to satisfy needs and the impacts that these processes have on the consumer and society." Although it is not necessary to memorize this definition, it brings up some useful points:

Behavior occurs either for the individual, or in the context of a group (e.g., friends influence what kinds of clothes a person wears) or an organization (people on the job make decisions as to which products the firm should use).

Consumer behavior within European Community involves the use and disposal of products as well as the study of how they are purchased. Product use is often of great interest to the marketer, because this may influence how a product is best positioned or how we can encourage increased consumption. Since many environmental problems result from product disposal (e.g., motor oil being sent into sewage systems to save the recycling fee, or garbage piling up at landfills) this is also an area of interest.

Nowadays, consumer behavior in EU involves services and ideas as well as tangible products.

The impact of consumer behavior on society is also of relevance. For example, aggressive marketing of high fat foods, or aggressive marketing of easy credit, may have serious repercussions for the national health and economy. With the unifying of EU the impact is even bigger.

1.2 European Perspective

Following the Second World War six European countries got together to find a way of ensuring peace amongst their nations. France, Germany, Belgium, Luxembourg, Netherlands and Italy, 'the Six', collectively decided that the best way to achieve this was to work together on coal and steel production as these were the main resources required for fighting wars. The European Coal and Steel Community (ECSC) was established in May 1952.

The success of the ECSC led to 'the Six' seeking to expand this co-operation to other areas. This led to the Treaty of Rome, which was signed in March 1957 and established the Common Market. This treaty created two more international bodies; the European Economic Community (EEC) and the European Atomic Energy Community (Euratom), to work alongside the ECSC.

The EEC soon became the most influential of these bodies, so in 1965 a treaty was signed that drew together these separate elements. The European Economic Community was born. Denmark, Ireland and the U.K. joined in January 1973. The first elections to the European Parliament were held in 1979 and take place every five years. Greece joined in 1981, followed by Portugal and Spain in 1986. The present fifteen member states was completed when Sweden, Finland and Austria joined in 1996

1986 saw major advances towards integration. European passports were introduced, the European flag was first flown and there was now even a European anthem, to the tune of Beethoven's 9th Symphony. The Single European Act also came into force to remove artificial trade barriers between states so that goods, capital, services and people could move, live and work freely and without restriction in any of the Member countries. Spain and Portugal also joined in this year.

The most far-reaching treaty regarding the EEC's roles and responsibilities took place in 1991 at a meeting in Maastricht, Netherlands. The Maastricht Treaty or the Treaty of the European Union brought all the different organisations into a single framework now known as the European Union called the E.U. The Treaty paved the way for economic and monetary union (the Euro), introduced policies covering social issues such as workers rights and health and safety and started the process of expansion. This expansion would enable other, mostly eastern European countries to join the E.U. The treaty also meant that the citizens from one E.U. country could travel and work freely in another E.U. country. On January 1st 1993 all trade barriers were removed, thus creating the Single Market.

The Maastricht treaty was updated in June 1997 with the signing of the Treaty of Amsterdam. It included further preparations for enlargement and reinforced the 'Social Chapter' which includes law on employment and discrimination. In 1998 formal negotiations were started with the Czech Republic, Estonia, Hungary, Poland, Slovenia and Cyprus. A year later, Romania, Slovakia, Latvia, Lithuania, Bulgaria and Malta opened membership negotiations. Turkey has also applied for membership, but formal membership negotiations have not yet started.

In January 1999, eleven countries met the rules for adoption of the Euro as their official currency on 1st January 2000. Greece met the criteria two years later. National currencies in these countries were replaced with the Euro in January 2002. The U.K., Sweden and Denmark retained their national currencies.

1.3 Euro’s Impact

The introduction of the Euro and the assumptions on how it could affect the European industries on an international level sounds quite acceptable. A wider market with more competition and lower prices is definitely something positive, although we can not overlook the disadvantages that the single currency and further economic integration brings to the slow lane countries, those too cautious to take part in the common currency at once, and even to the fast lane countries that might have a problem with keeping their industries going and the economies floating, when they can not change their exchange rates any more. Of course, there is no way for us to know for sure how this economic integration will actually work in reality.

2. Characteristics of European Consumers

2.1 Perception

Perception is the process by which physical sensations such as sights, sounds and smells are selected, organized and interpreted. The eventual interpretation of a stimulus allows it to be assigned meaning. A perceptual map is a widely used marketing tool that evaluated the relative standing of competing brands along relevant dimensions.

Marketing stimuli have important sensory qualities. We rely on colours, odours, sounds, tastes and even the "feel" of products when forming evaluations of them.

Not all sensations make their way successfully through the perceptual process. Many stimuli compete for our attention, and the majority are not noticed or accurately comprehended.

People have different thresholds of perception. A stimulus must be presented at a certain level of intensity before it can be detected by an individual's sensory receptors. In addition, a consumer's ability to detect whether two stimuli are different (the differential threshold) is an important issue in many marketing contexts, such as changing a package design, altering the size of a product or reducing its price.

A lot of controversy has been sparked by so-called subliminal persuasion and related techniques, by which people are exposed to visual and audio messages below the threshold. Although evidence of subliminal persuasion's effectiveness is virtually nonexistent, many consumers continue to believe that advertisers use this technique.

Some of the factors that determine which stimuli (above the threshold level) do get perceived are the amount of exposure to the stimulus, how much attention it generates and how it is interpreted. In an increasingly crowded stimulus environment, advertising clutter occurs when too many marketing-related messages compete for attention.

A stimulus that is attended to is not perceived in isolation; it is classified and organized according to principles of perceptual organization. These principles are guided by a gestalt, or overall pattern. Specific grouping principles include closure, similarity and figure-ground relationships.

The final step in the process of perception is interpretation. Symbols help us make sense of the world by providing us with an interpretation of a stimulus that is often shared by others. The degree to which the symbolism is consistent with our previous experience affects the meaning we assign to related objects. Every marketing message contains a relationship between the product, the sign or symbol, and the interpretation of meaning. A semiotic analysis involves the correspondence between stimuli and the meaning of signs.

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