AP® Business with Personal Finance review sheet from Aim for Five (aimforfive.com/business-finance/units/2/2-2)
Unit 2 · Topic 2.2
2.2 Consumer Behavior
People buy things to meet needs and wants, but the reasons behind any single purchase mix personal, psychological, social and situational factors. Laws and technology change buying habits over time, and marketers use Cialdini's principles of influence to nudge people toward yes.
Key terms
- rational decision-making
- purchasing pattern
- situational influences
- principles of influence
- scarcity
- reciprocity
How people decide what to buy
When several products meet the same need, people choose based on price, features that set products apart, availability and advertising.
For big decisions, like a car or a home, many people use a rational process: they compare options step by step and pick the one that best fits their needs. That usually leads to a better choice, but it costs time and effort to gather information. Most small purchases, like a drink on the way to school, are habits or routines that take almost no thought.
Four kinds of influences
- Personal factors: age, sex, education, income, budget, job and lifestyle. They shape what you need and what you can afford.
- Psychological factors: your values and beliefs, perceptions, learning (what past experiences taught you) and motivations. They shape your attitude toward a product and whether you're willing to buy.
- Social and cultural factors: friends, family, social status, cultural norms and media. They shape what seems acceptable or desirable to buy.
- Situational factors: store design (noise, lighting, layout), timing and whether the product is in stock. They create short-term conditions that make buying more or less likely, like candy at the checkout line.
Purchasing patterns, laws and technology
A purchasing pattern is your usual routine for buying: when, how often and how much. Where you live and work, your income and the habits of your family and friends all shape it.
Laws change patterns by controlling what people can buy and when and where. Consumer protection laws, for example, keep fraudulent or unsafe products off the market. When a law makes a product hard to get, people often switch to substitute products that meet the same need.
Technology changes patterns by making new products and ways of shopping possible. The internet in the 1990s and smartphones in the 2010s changed how people shop, find information and get entertainment.
Cialdini's principles of influence
Psychologist Robert Cialdini identified mental shortcuts that make people more likely to say yes to a request. Marketers build sales tactics on them.
| Principle | The idea | Marketing tactic |
|---|---|---|
| Scarcity | Things seem more desirable when they seem rare | Only 3 left!, limited-time offers |
| Authority | People follow experts and authority figures | A dentist recommending a toothpaste, showing credentials |
| Consensus | People do what others like them are doing | Star ratings, 10,000 five-star reviews |
| Liking | People say yes to people they like or relate to | Ads with people who look like the target customer, friendly salespeople |
| Reciprocity | People feel they owe something back after receiving something | Free samples, free trials, small gifts |
| Consistency | People act in line with how they see themselves | Marketing a product as what health-conscious people buy |
| Unity | People are swayed by groups they feel part of | Exclusive members' groups, inviting fans to help design products |
Worked examples
Try each one yourself first, then open the solution.
- Example 1
Naming the principle behind a tactic
Identify the Cialdini principle each tactic uses: (a) A skincare brand's ad features a dermatologist in a white coat. (b) A grocery store hands out free cheese samples. (c) A shoe website shows only 2 left in your size. (d) A sports drink invites customers to join its runners' club and vote on new flavors.
Show the solutionHide the solution
- Step 1: (a) The dermatologist is an expert, so this is authority.
- Step 2: (b) A free gift creates a feeling that you owe something back, so this is reciprocity.
- Step 3: (c) Low stock creates urgency, so this is scarcity.
- Step 4: (d) Joining a club and helping create products builds a sense of belonging to a group. The trap is calling it consensus; consensus is about following what most people do, while unity is about feeling part of a group.
Answer: (a) authority, (b) reciprocity, (c) scarcity, (d) unity.
Common mistakes
- Confusing consensus (most people like it, so I will too) with unity (I'm part of this group).
- Calling store layout or timing a psychological factor. Those are situational influences.
- Assuming every purchase is rational. Most small purchases are habits.
On the exam
- Multiple-choice sets often describe a sales tactic and ask which principle of influence it uses, or which factor (personal, psychological, social or situational) explains a buying decision.
- If you're asked to develop or evaluate a sales tactic, name the principle, describe the tactic and explain why it would work on the target customer.
Connected topics
Videos
Check yourself: 2.2 Consumer Behavior
4 questions on 2.2 Consumer Behavior. Pick an answer to see if you got it, and why.
Glow Lab, a skincare brand, is testing four sales tactics on its website.
Tactic 1: A banner reads, "Only 3 left at this price!"
Tactic 2: Every order comes with a free travel-size sample of a new face cream.
Tactic 3: Product pages show "4.8 stars from 12,000 reviews" and "Most popular with shoppers like you."
Tactic 4: Ads feature a board-certified dermatologist recommending Glow Lab products.
Hypothetical marketing plan
Tactic 1 draws mainly on which of Cialdini's principles of influence?
Tactic 2 draws mainly on which principle of influence?
Which pairing correctly matches Tactics 3 and 4 with principles of influence?
Glow Lab wants a fifth tactic based on the unity principle. Which tactic fits best?
0 of 4 answered