Situational Influences and Online Shopping

a. Why consumers shop online

i. Convenience: What could be easier than shopping from your own home (or on the go with a smartphone) anytime you want?

ii. Communication: Instantly correspond with other consumers, sellers and company representatives to easily gather information about a purchase.

iii. Choice: Consumers can rapidly search through multiple stores from all over the globe instantly. Consumers can also easily research a company/product capabilities and popularity.

iv. Cost: Consumers feel empowered when they can shop around at such a fast speed, they can make more informed purchasing decisions especially when it comes to prices. Companies need to make sure they are offering prices comparable to their competitors, because customers will figure it out and not purchase from them!

v. Customization: Another positive aspect of the Internet is the ability for the customer to purchase a product exactly how they want it; and the company avoids paying inventory storage costs and overhead for a retail location since the products are made and then shipped directly to the customer. Dell Computers turned their small operation into a multi-million dollar company on this marketing idea.

vi. Control: Customers seem to have more control over quantity, size, style, color, price and the type of vendor that they purchase from when using the Internet. Purchases for second-hand products can be made on e-bay, creating a whole new genre of stores.

b. The 7 C’s of Driving Website Commerce

i. Context: A website’s layout, visual design and use of colors, white space, graphics and information have to all create a theme that makes sense for the company and products.

ii. Commerce: A website’s ability to allow customers to make purchases safely, and also to make returns.

iii. Connection: Links to other websites. The amount of links depends on the company and the products.

iv. Communication: A website can allow communication between the company and the consumer, some sites use live chat capabilities, others use a message board or email.

v. Context: A websites use of text, fonts, sounds, music, video demonstrations to convey a theme or help convince customers to purchase.

vi. Community: Some websites will allow customers to talk to each other via message boards or leave comments about products.

vii. Customization: A website can be customizable by the customer and tailor itself to different users. Amazon.com makes personal recommendations based on past purchases. Some gaming websites will allow the user to choose to see information on only the games they own.

c. Online Consumer Lifestyle Segmentation

i. Click and Mortar— Only shop online for research, then go to the physical store to make purchases.

ii. Hunter Gatherers— Enjoy going online for the thrill of auctions and bargain hunting

iii. Brand Loyalists– Enjoy going online, but only to look at websites and products they are comfortable with.

iv. Time Sensitive Materialists– Only go online for news update, stock updates.

v. Hooked, online and Single— Young, (tweens, teens, college students) who are extremely tech proficient and use the Internet for news, networking and shopping.

vi. Ambivalent Newbies— Not technologically proficient, may only go online occasionally or to check e-mail.

by Mkt Teachers

Situational Influences and Time

Time is something that customers give up in order to shop and this is a very valuable thing! It is necessary to give up time for consumption to occur, but time can affect consumption in three forms:

i. Time Pressure— When customers don’t have a lot of time they tend to process less information because time is important for thorough problem solving. Customers in a hurry may choose the well- known (and usually higher priced) brand because they don’t have time to consider the alternatives. Or they may choose the least expensive product and risk buyer’s remorse (cognitive dissonance).

ii. Time of Year—Consumers are affected by the changing seasons, but not just according to the product needs such as coats in winter and sunscreen in summer, they are also affected by the amount of daylight. Due to daylight savings time and the increased amount of darkness in winter, consumers shop earlier in the day, and they tend to purchase more comfort products. Overall consumers tend to spend more money in the summer. Food items vary with the season and holidays.

iii. Time of Day—Everyone has a circadian rhythm, which helps regulate our sleeping and awake times. Most people are naturally sleeping (or tired) during midnight to 6am and from 1pm to 3pm. People who shop during these hours may have less energy and may not make informed purchases. In order to counteract this many people turn to energy drinks and caffeine in the morning hours. Danes, Italians, French and Americans drink coffee, while those in the UK, and some Asian countries drink tea.


by Mkt Teachers

External Influences - Consumer Culture

a. Culture includes knowledge, belief, art, law, morals, customs, and any other capabilities and habits acquired by humans as members of society.

b. How does culture affect consumer behavior? Whatever a person consumes will determine their level of acceptance in their society. If someone does not act consistently with cultural expectations, they risk not being accepted in society.

c. What happens when a company ignores culture? McDonald’s is one of the most popular restaurants in the world. At their American based restaurants they serve beef hamburgers, but when they decided to open restaurants in India, they used lamb meat for their hamburgers, because the Indian people do not eat cow meat; if McDonald’s had ignored this cultural difference they would not have been successful in India! That was the problem when The Walt Disney Company opened EuroDisney outside Paris; it was almost a failure because Disney ignored the culture. The French people drink wine at very young ages and prefer sugar on their popcorn, not salt, like Americans. Disney did not accommodate their theme park until they realized that the French people were indeed their target market, so they changed the name of the park to Disneyland Paris and made modifications to their menus and also to the wait lines in the park.

Behavior	Meaning in the US	Meaning in other cultures
Consuming wine and beer	Those under the age of 21 are not allowed to drink alcohol	In European countries it is common for children to drink wine/beer at family meals; when in a bar in Korea you pour drinks for your friends and family first, then wait for them to pour your drink
Drinking coffee	Generally adults drink it in the morning because of the caffeine, and giving coffee to a child is not accepted	In Turkey, coffee is a special drink that you serve to guests; in Italy coffee is enjoyed after a family meal; in China tea is the drink of choice
Cooking pork ribs	Grilled outside at a backyard party	Jewish and Muslims do not eat pork
Kissing	To express romantic feelings about someone	In many cultures kissing is acceptable when greeting a friend
Using the number 7	Lucky number	Unlucky number in Kenya, Singapore and Ghana

d. Factors that Define a Culture

• i. Individual/Collective: The culture in the US is an individualistic society, where people generally look out for themselves; The Japanese culture focuses on the collective, and people work to better society as a whole.
• ii. Extended/Limited Family: In the US, families move away from each other and generally don’t live together in the same house; In many Asian and European countries, parents, kids, grandparents and even aunts and uncles live together in the same house.
• iii. Adult/Child: Different cultures will define when someone is an adult. In the US it is 18 years old, but in some South American countries it is 14 or 15 years old. In the Hebrew culture a boy becomes a man at 13 during his Bar Mitzvah ceremony. In the Hispanic culture a girl becomes an adult at 15th birthday party.
• iv. Masculine/Feminine: Cultures define the roles of men and women differently, including their rank, and prestige in society.
• v. Youth/Age: The value placed on Elders depends on the culture
• vi. Cleanliness: In the US, cleanliness is very important, in fact most of the products advertised on American TV claim to improve cleaning; In other cultures showering on a daily basis is unnecessary.
• vii. Tradition/Change: Some societies prefer traditions over making changes.
• viii. Hard work/Leisure: In some cultures hard work is valued over leisure time.
• ix. Postponed gratification/Immediate gratification: American culture is centered on immediate gratification “I want it now!”
• x. Sensual gratification/Abstinence: The Netherlands is a society that openly talks about and advertises sexual activity; in Muslim societies those topics are taboo, and women who get pregnant before marriage are often shunned.

by Mkt Teachers

Family Life Cycle (FLC)

Family life cycle is defined as what type of family the target market consumer is in. DINKS are “double income no kids” and SINKS are “single income no kids”. Marketers love to target the DINKS and SINKS because they have lots of discretionary income and no children to spend it on, so they spend their extra money on themselves, their house, their pets and vacations.

Stages of the Family Life Cycle (FLC)

• Young and single
• Engaged couples
• DINKS (Double Income No Kids)
• SINKS (Single Income No Kids)
• Married with children: Babies, Toddlers, Elementary School Age (5-7), Tweens (8-12), Teens (13-17), Older
• Single parents
• Empty nester
• Boomerang Kids (adult children who have moved back in with their parents)
• • Extended parents (grandparents raising their grandchildren)
  • Blended Families (stepchildren)
  • Cougar and Silver Fox
  • Recently divorced
  • Same-sex singles/couples
  • Retired - Wealthy or Medicare dependent
  The engaged couples and the recently divorced spend money on similar products, although for different reasons. Engaged couples are buying products to begin a life together and the recently divorced are buying products that they already had and now need to replace. Extended parents are grandparents taking care of their grandchildren. Same sex couples and singles are grouped together whether they have children or not, because of their lifestyle and interests. An empty nester is someone whose children are now grown adults and have moved out of the house. Boomerang kids are adult children who are living with their parents.