potential violation of duty (responsibilities of government officials to uphold the law)
∙∙ Weaknesses: ignores promises and duties, does not take into consideration rights,
justice, and obligations (i.e., free speech might do more harm, yet is a basic right)
obligations), examines motives (e.g., giving to charity for tax reasons or for
cut priority among rules
individuals affected by an action (> 0 = good, < 0 = evil) – critics argue is pleasure a
sufficient measure of human happiness?
PRODUCES THE GREATEST BALANCE OF PLEASURE OVER PAIN FOR
(greatest net balance between pleasure and pain), universalism (everybody included in the
GREATEST BALANCE OF PLEASURE OVER PAIN FOR EVERYBODY
SET OF RULES THE GENERAL ACCEPTANCE OF WHICH WOULD PRODUCE
THE GREATEST BALANCE OF PLEASURE OVER PAIN FOR EVERYONE
— Difficulty in calculating how much, in identifying alternative courses, and
accounting for differing preferences among different people
wrong under the utilitarian calculation
(predetermined ends with least costly means)
understates value (ignores opportunity costs)
corporations to offer or make any payment to a foreign official for the purpose of
“influencing any act or decision of such foreign official in his official capacity or of
inducing such foreign official to obtain or retain business.”
under local law)
not the corporations)
— OECD treaty (1996) should lead to other countries adopting FCPA standards
|Alternative Costing System – Click on image to enlarge|
Perhaps the most useful set of categories is that of low, medium or high level models. In this case the level refers to the level of complexity – so a low level model would be a relatively simple representation of the phenomenon while a high level model of the same event would be much more complex and detailed and
include more variables.
- Black Box models
- Personal variable models
- Personal Variable/Post Purchase Satisfaction model
Black Box Models of Consumer Behaviour (Soloman, Bamossy & Askegaard, 1999)
- Black box models focus solely on inputs and outputs
- Do not consider internal variables.
- They suggest that a given stimulus will prompt a particular response, within this processing centre;memory, goals and expectations are considered.
Simple black box models are based on identifiable observable and measurable variables, however they are unable to predict or explain behaviour.
Nicosia Model (Dubois 2000)
The model is split into four key fields:
- The source of a message to the consumers attitude
- The search for and evaluation of alternatives
- The act of purchase
- Storage and the use of the purchased product.
The model attempted to demonstrate how the company influences the consumer through its promotional and advertising activities. However, criticisms have been raised about this model, include its descriptive content, its brevity, that it has never been fully tested and is now considered historical.
1. Economic model: Economic model of consumer behaviour is one-dimensional. This means that buying decisions of a person are governed by the concept of utility. Being a rational man he will make his purchase decisions with the intention of maximizing the utility/benefits.
Economic model is based on certain predictions of buying behaviour
(a) price effect-lesser the price of the product, more will be the quantity purchased
(b) Lesser the price of the substitute product, lesser will be the quantity of the original product bought (substitution effect)
(c) More the purchasing power, more will be the quantity purchased (income effect).
2. Learning model: Classical psychologists have been interested in the formation and satisfaction of needs and tastes. They argued that living beings were influenced by both innate needs such as the primary needs of hunger, thirst, sex, shelter and learned needs like fear & guilt. A drive or internal stimulus which when directed towards a drive-reducing object becomes a motive. The various products or service will act as a stimulus to satisfy drives.
For example, if you are a hungry you will be driven towards food, which after consumption will reduce the
drive and provide and provide satisfaction.
3. Psychoanalytical model: This model is based on the work of psychologists who were concerned with personality. They were of the view that human needs and motives operated at the conscious as well as subconscious levels. Sigmund Freud developed this theory.
According to him human behaviour or personality for that matter is the outcome of three components, viz.,
(a) ‘id’ which is the source of all psychic energy which drives us as action
(b) ‘super ego’ which is the internal representation of what is approved by the society
(c) ‘ego’ which is the conscious directing ‘id’ impulses to find gratification in a socially acceptable manner.
Thus we can say that human behaviour is directed by a complex set of deep-seated motives. This means that buyers will be influenced by symbolic factors in buying a product. Motivational research has been involved in investing motives of consumer behaviour so as to develop suitable marketing implications accordingly. Marketers have been using this approach to generate ideas for developing product-design, features, advertising and other promotional techniques.
4. The sociological model: According to this model the individual buyer is a part of the institution called society. Since he is living in a society, gets influenced by it and in turn also influences it in its path of development. He is playing many roles as a part of various formal and informal associations or organisations i.e., as a family member, as an employee of a firm, as a member of a professional forum and as an active member of an informal cultural organization.
The Howard Sheth Model of Buying Behaviour serves two purposes:
1. It indicates how complex the whole question of consumer behaviour is.
2. It provides the framework for including various concepts like learning, perception, attitudes, etc., which play a role in influencing consumer behaviour.
Inputs: In the Howard Sheth theory, the most significant stimulus affecting the buying behaviour are the information cues about the characteristics of the product. These cues may be significant if it comes to the buyer from the product itself when he is involved in a shopping activity. A similar set of cues, which are symbolic in nature, may also act as information sources. Both these significative and symbolic information cues represent the firms marketing efforts. The broad or product characteristics acting as information cues are quality, price, distinctiveness, service and availability.
There are impersonal sources like mass media communications and advertising, over which the firm has no control. However, the information sources also include sales and service personnel who can add and help the marketing efforts of the firm. The third source is social information cues which could affect buying behaviour towards the product or brand and these include family, friends or other members of the group with whom buyer comes into contact or to which he aspires to be in. The social source is personal and the company marketer has no control over this source.
Perceptual Constructs: This refers to all the complex states or psychological processes (perception) and how the individual deals with the information cues received from various sources. It can be seen that all information available is not attended to (attention) and may not always be crystal clear in its meanings
(ambiguity). Although the individual may be engaged in an overt search for information, sometimes he/she may be bombarded with unwanted information. Moreover, any information cues to which the individual may attend may be distorted (perceptual bias) as result of his own frame of reference.
Learning Constructs: The second set of hypothetical constructs in the Howard Sheth model of buying behaviour are more complex and numerous. ‘Motives’ refers to the goals the individual attempts to achieve
through his/her buying behaviour. These goals are derived from the various drives (needs), which may be acting as a cue for his/her motive.
More closely related to the buyers intention in his attitude towards the product/brand. Whether he/she formed a positive attitude towards the product/brand. Other learning constructs include ‘brand comprehension’ i.e.,
knowledge/awareness about the brand characteristic features that forms the basis for the buyers evoked set of alternatives; choice criteria, and the confidence the individual has about his/ her brand comprehension, attitudes, or intentions. Finally, the Howard Sheth model includes a construct, ‘satisfaction’. This refers to ‘feedback’ mechanism, i.e., the post purchase and post use evaluation of the output of the process.
Output: The purchase decision is the output. If after using the product, the consumer is satisfied with it, this will reinforce his positive attitude and purchase intent about the product and brand. Also, the positive attitude makes the consumer more attentive to the product/brand’s stimuli and further increases his brand comprehension.
If the consumer is dissatisfied with experience of using the product/brand, it will trigger off a reaction of negative attitude, low attention to the product stimuli. Poor brand comprehension and negative intention to purchase.
Exogenous or external Variables: Howard Sheth model theory also includes a number of variables, which are not explained but have a bearing on some or all of the constructs discussed above and indirectly
influences the output or consumer response.
1. Social and organizational setting: Man is basically a social animal. Because of his interactions with various groups and society, they look to each other for guidance regarding what to buy, how to buy/dress, etc.
2. Social class: In order to conform to the norms of the social class to which he/she belongs, the individual will be engaged in a behaviour, which will be acceptable to the social class to which it belongs.
3. Culture: refers to the shared, somewhat consistent pattern of behaviour of a group of people. Each culture has a set of beliefs, values, etc. So the pattern of buyer behaviour will be based on a pattern of behaviour shared in a specific subset of a larger culture-a subculture trait.
4. Purchasing power/ Financial status: The money/income available for purchasing goods and services during some specific time period also plays a role in influencing the consumption pattern and thereby his buying behaviour.
- Deals with low-involvement situations. It is suggested that in low involvement situation the degree to which the various stages in the model are undertaken decreases
- No way of testing e.g. If had idea of personality characteristics how could they be applied or measured in relation to predicting buyer behaviour
- Lack of specificity i.e. variables are named in superficially plausible way but not specified in any operational detail