Buyer Behaviour Assignment

[ ] September 28, 2009

Done By : Lahiru Dilip Jayampathie (CB003121)

Assignment Title: Individual Assignment

Subject : Buyer Behaviour

Subject Code : ABUS007-3-2-BBEH

Intake Code : DF0931

Supervised By : Mr. Rajitha Silva

Date Assigned : 24 August 2009

Date Due : 28 September 2009

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Acknowledgement

In the completion of this report, I’m deeply indebted to Mr. Rajitha Silva

the lecturer of Buyer Behaviour of our batch with a reputed love for the teaching of the

subject, in Colombo APIIT branch, for his continued assistance and encouragement. He

has indeed my ‘guru’ who’s penetrating criticisms and enlightening directions have

greatly improved my work.

I must acknowledge my obligations to my loving parents for giving their

fullest corporation to make this a success by providing me lot of equipments which

helped me a lot to complete our work in a pleasant way.

I’m grateful to all my class members for giving their support in a great way

by providing us much information which were very essential to complete my work with a

lot of information and for dedicating their valuable time for me.

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Table of Content

Contents

Acknowledgement...............................................................................................................2

Table of Content..................................................................................................................3

Introduction..........................................................................................................................4

Q.01) Analyze the identified product in terms of the total product concept to determine a

complete picture of the benefits consumer seeks and experience.......................................5

Total Product Concept.....................................................................................................7

Q.02) Use segment bounding, segment viability and segment strategies for the identified

product...............................................................................................................................16

Segment bounding..........................................................................................................17

Segment Viability..........................................................................................................20

Segmentation Strategies.................................................................................................22

Q.03) Apply “positioning” for the identified product to its target segment(s)..................24

References..........................................................................................................................28

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Introduction

This report would comprise with the buying behavior of the consumers and the factors

that would have a clear influence on the decision making process. Further it will be

concentrating on a particular product, Nokia N810 and will be providing an analytical

report in terms of total product concept, market segmentation and positioning relating to a

set of questions that have need of answers.

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Q.01) Analyze the identified product in terms of the total product

concept to determine a complete picture of the benefits consumer seeks

and experience.

A consumer purchase is a response to a problem which can be further explained as a

consumer as a person identifies a need or a desire and simply makes a purchasing

decision depending on various factors. According to Michael R. Soloman (P7, 2007) the

behavior of the consumers can be detailed as “the study of the processes involved when

individuals or groups select, purchase, use or dispose of products, services, ideas or

experiences to satisfy needs and desires.” The marketers have realized that consumer

behavior is an ongoing process which does not simply ends when the transferring of

money in turn to a good or a service takes place.

Making a purchase involves a decision making process made up of five stages and it’s

not always needed to go through the same procedure in order to purchase something. In

today’s context of buyer behavior, customers do not simply buy products or services but

benefits. Consequently people don’t tend to buy products themselves, nevertheless

benefits or the opportunities they offer. For case in point if the person is always late in

work a watch can be an answer for the problem. The person may be purchasing a watch

which also has the stop watch facility which offers an added benefit as he uses it for

clocking his timing in daily jogging.

The perceived benefits a customer seeks could diversify for different individuals. One

may be seeking for a bundle of benefits and at the same time another may be satisfied

with very little. The benefits which customers seek can be classified in to two categories.

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Tangible Benefits:

Tangible benefits can be measured and gained by consuming the product. Some

tangible benefits related with Nokia N810 tablet computer can be mentioned as

fast internet surfing, sensitive touch screen, GPS facility, full screen finger

keyboard, task navigator etc.

Intangible Benefits:

These benefits are immeasurable and may take time to attain. Those are created

and developed in the minds of the consumers as feelings by using a particular

product. It can be mentioned as reputation, reliability, brand image, popularity of

the brand and the image of the users of Nokia N810 may fall in to this category.

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Benifits

IntangibleTangible


Total Product Concept

Total product concept can be defined as the sum of the benefits offered by a product or a

service. [Lascu, Lindquist, Sirgy 2003, p.04]. It comprises with four levels and both

tangible and intangible benefits can be explained further with the help of this concept.

Basic Core:

The basic core of the product refers to the bundle of utilitarian benefits obtained.

[Lascu, Lindquist, Sirgy 2003, p.04]. Mean time it can be worded as the bundle of

functional benefits customers obtain as a result of their purchase of goods or

services and may include features, design, etc…

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Time

Psychological Ring

Accessory Ring

Basic Core


The core benefits that can only be experienced through purchasing a Nokia N810

would be:

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Accessory Ring :

9


Accessory ring would comprise of the value added benefits which the customer

will be getting for the purchase he or she makes without any additional cost.

These benefits are freely awarded to the customers and from those some of the

thing can be identified as convenient location, manufacturer prestige, reputation

of both manufacturer and the available store, after sales service, etc... Nokia N810

is rich in that aspect and will be offering various tangible and intangible added

benefits exclusive of any superfluous.

Some of the in plain sight elements of the N810 value added benefits

Convenient location

Nokia Corporation is blessed with a well defined and structured supply base as

well as service locations allowing customers purchasing and device repair

service if required a worry free event. They have authorized dealers located in

every territory. Also purchasing is much easier as never before with the Nokia

online purchasing system as you can make Nokia 810 your own in just seconds.

You can supplement your requirement in Sri Lanka through Soft Logic

Corporation. The device is available in different regions as America, Asia-

Pacific, Europe, and Middle East.

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Manufacturer Prestige

What makes N810 even more convincing is that it is invented by one of the

leading in telecommunication devices producers Nokia which has a reputation of

producing high tech, high quality products for many years. It isn’t a doubtful

operation to purchase a Nokia as the company has guaranteed reliability and

created faith in its products. It also makes sure to keep up with the promises made

related with the guarantees and warrantees in any troublesome circumstances

which make customers feel safe.

Reputation

Nokia 810 is known as a device which provides the cutting edge in connecting to

the internet in milliseconds. It also comes across as a device which enables you to

locate your position no matter where you are and live up to the expectations of all

possible modern communicating and entertaining facilities in a single device. This

device is a respect to have and the grater utilization of the device would help you

to make that complicated routines to become attainable and stand alone from the

society.

Technical Support and Software Updates

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Once you become a valued user of N810 you are exposed and eligible to many

services offered by Nokia. You can download latest updated software,

applications, get tech support, contests and various other services are offered free

at Nokia.

Psychological Ring

Intangible benefits which are associated with the product or service the customer

purchases would come under psychological ring and according to Lascu, Lindquist,

Sirgy( 2003, p.04) it can be described as the ”benefits result from the consumer’s

feelings associated with the possession and/or use of the product”.

Belongingness, youthfulness and powerfulness can be pointed out as some of the

likely features that are like injected to the consumer simply only through the use of

the particular device. Those can be socially related factors which increase customer

satisfaction and make the person prestigious about using the product. Individuals who

use Nokia as well as N810 are accepted socially as reputed people and it makes the

person using the product feeling belonging to a specific group of people which helps

to increase his or her status in the society.

Time

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Time is a critical factor engaged in acquiring a product or a service as it gives a

positive as well as a negative impression to the customer and can be giving or taking

time. The easiness of acquiring the product/service will have a positive impact while

the excess time taken may result in dissatisfaction. In point of view of Lascu,

Lindquist and, Sirgy (2003 p.04)”when the consumers purchase a product or a service

they either spend or save time and may create positive or negative outcomes” The

customers can select the best suited method for them to purchase the N810 as it is

available online and widely in outlets as well.

.

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Q.02) Use segment bounding, segment viability and segment strategies

for the identified product.

As it is rightly mentioned marketers do not create market segments they just find it.

Market segmentation refers to the identification of like-minded clusters of consumers

who can be expected to behave in similar ways, making similar decisions in the

marketplace in similar situations [Lascu, Lindquist, Sirgy 2003, p.05]. It is a study of the

marketplace in order to find out economically feasible and identical customers who

already exist in the market place.

(Source: blog.themarketinganalysts.com)

Market segmentation may involve four steps

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1. Identification of product related need sets

2. Group customers who have similar needs

3. Describe each group

4. Select an attractive segment to cater to

It is likely that people on the go, young people who demands cutting edge in technology,

professionals and industrialists may be fascinated by Nokia’s N810. The demand for this

device may be high in this group and thus it can be varied accordance with their needs

and what the device is offering to them.

Market segmentation can be classified in to three categories.

1. Segment bounding

2. Segment Viability

3. Segment Strategies

Segment bounding

It’s the initial step in market segmentation and “Segment Bounding is the method of

differentiating consumers and market segments” [Lascu, Lindquist, Sirgy 2003, p.06].

It can be explained further as the marketers differentiating among consumers and

market segments. This process can be exercised though three steps and is essential to

Nokia to determine their intended group of customers in order to become flourishing.

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i) Determine the descriptors consumer in the segment

It is essential to determine likely descriptors before coming up with the product and

demographics, psychographics, behavioral aspects can become some of them.

When it comes to demographic segmentation variables such as age, family size,

family life cycle, gender, income, occupation, education, religion, race, generation,

nationality, and social class are taken in to account (Kotler 2003’p6) It will be a

important factor for Nokia to consider these aspects as it will determine the success or

may take some pounding. It is likely that young people, professionals, industrialists,

high income people, upper class people may be demanding N810 a lot as it is suiting

their requirements and needs to be concentrating on these people as it requires some

purchasing power than a normal cellular phone.

Psychographic is the science of using psychology and demographics to better

understanding the consumers. (Kotler. 2003,p7) It is important identify the benefits

that the customers sought as it can help better serve the segment. In today’s context

many customers are quality conscious and it will be beneficial to Nokia as they are

well known for producing quality products more importantly at reasonable prices.

In behavioral factors buyers are divided into groups on the basis of their knowledge

of, attitude toward, use of, or response to a product." (Kotler et al, 2003). It will be

further including product usage rate, consumption pattern, user satisfaction and the

customer loyalty toward the product.

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ii) Determine specific geographic location

It is helpful to recognize the typical users of the Nokia N810 and the hawk eye of

Nokia would be on people who live in highly developed regions as well as the cities.

The importance it has on that is N810 is mainly an internet tablet computer which

mainly concentrates on providing the internet facility as well as the some of the

capabilities of a computer for the people who may be on the go. Hence it isn’t highly

theoretical for Nokia to concentrate on above mentioned type of people as those

services are required and can be acquired only by people who have the availability of

the wireless connections and who are exposed to handle high tech devices. Once the

locations are identified it is useful to concentrate more on that segment and carry out

their exercises focusing on it.

iii) Bound Segments in Time

Requirement of a research is priceless to identify the perfect segment before

marketing any product. Hence it is needed to collect data and gather relevant

information and the most important aspect of it is that it should be ensured that all the

data that is collected is relevant and up to date and when the time of use for the

decision making. It will be the decider between a perfect and a false plan.

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Segment Viability

Segment bounding doesn’t simply end the segmentation process as it is also important

to figure out the viability of the segment. Four steps are taken in to account in

assessing the viability.

(Source: www.niblettes.com)

Measurable

Marketers should take measurability in to account in many aspects of the

selected segment before the production. It is essential to take the approximate

amount of the population relating to income, target customers, social class,

nationality etc…It can be achieved both through analytical assessments which

will help Nokia to meet the demand and supply equalities. It is also better to look

at the qualitative data like behavioral factors as well.

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Differentiated

It is a useful marketing strategy in which the firm decides cater to different target

market segments by offering different offers. It helps the organization to attract

several segments with a unique product. In the case of Nokia some customers

may be seeking a built in radio facility as some are looking at a built in television

option and Nokia can serve both categories by making their dream a reality.

Accessible

It refers to the ability of the firm to deliver the product to its target customers

which will be most important in business world. The availability of the product

without any shortages is very important as well as the limited difficulties if it

isn’t zero in purchasing. One strategy would be to make available the product

online as it will reduce access time a lot. People who use to buy via internet

dearly love it even though it is also essential to have conventional outlets to serve

the customers who value spending time on purchasing through outlets.

Sufficient size

What is important in maintaining substantial consumers is that if there isn’t much

of a demand it’s no point of producing such devices. It’s only worth Nokia

produce N810 if there is sufficient demand to bare up its costs as well as gain

expected profits.

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Segmentation Strategies

After the viable segments are identified marketers need to look for the

segmentation strategies for the recognized segment. It can be done using three

strategies known as mass marketing, concentrated marketing and differentiated

marketing.

Mass Marketing

Mass Marketing is also identified as differentiated marketing where there

isn’t any concentration to a specific group as the as the marketer offer the

same product to the entire population.

Concentrated Marketing

It’s also known as focused or niche marketing in which marketers

concentrate on selecting one market segment to the serving even though it

may suite to others as well.

Differentiated Marketing

It is known as catering to two or more different segments.

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Micro Marketing

It is about individual marketing in which the marketers concentrate more

on individuals.

(Source: www.fastfacility.com)

After analyzing the all possible strategies it can be rest assured that Nokia is better

off using the concentrated marketing for its N810. Many reasons can be pointed

out as to why Nokia should go with this strategy.

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One reason is that it is relatively expensive than the normal products which

comes under Nokia and every one would not be interested in it other than the

people like professionals, young generation, high income earners, industrialists

and also the upper class people who value the innovations of new technology.

Mean time a preferable demand can be derived mainly through this set of people

as some competency level in technology and the requirement is needed to manage

and have such a device.

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Q.03) Apply “positioning” for the identified product to its target

segment(s).

(Source: www.sobevent.com)

Product positioning can be explained as the placement of a product or service in the

minds of the consumer. According to Kotler (2006, p.216) “positioning is the way the

product is defined by consumers on important attributes”. It’s all about creating a strong,

unique and more recognized image in consumers’ minds. Nokia first needs to identify the

requirement of product positioning in order to achieve their objective. The following

aspects can be worth of having a look for Nokia.

I. To strengthen the power of messages directed at customers.

II. To target a particular segment.

III. To ensure that the product differentiated in the minds of customers.

IV. To decide on the ground on which to compete.

V. To analyse repositioning possibilities.

(Source: http://tutor2u.net)

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Meantime there is five possible ways Nokia can be able to locate the N810 in the minds

of the customers.

On perceived benefits

Positioning can be done through meeting the minds of the consumers what seems to

carrying a lot of weightage for the customer satisfaction. Reputation, reliability,

brand image, quality may be some of the respected benefits that the customers

inquire. Mean time Nokia can concentrate on highlighting its product through its

features, after sales service and ease of use which is the cornerstone of Nokia for

many decades that is coming up products which gives total satisfaction to the user

and has become the secret of success for Nokia.

On image

It can be the most significant factor in product positioning of Nokia since it has a

reputation of being a demanding brand for many years which makes life easy for

Nokia to position its new N810 in the minds of the customers. Parenthetically it is

regarded as a known way of product differentiation.

On attributes

Nokia can count on it in a big way which is associating with the brand in a largely

manner. It can be done through defining the benefits that the product would offer

such as quality, design, features and style and the user friendliness what Nokia is

known for a lot.

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Against competitors

The key word is to differentiate the product from the competitors which will give

you the cutting-edge. It can be done through price, features, design, etc…and. For

Nokia to be successful in this event it should set apart their product from its strong

competitors like apple I-phone, Blackberry, Sony Ericsson. These strong competitors

also having come up with likely devices may make life difficult for Nokia. Even

though the situation is like that Nokia can take advantage of the discussions which

are going on about some of the competitors like apple and blackberry which are not

renowned for ease of use. On the other hand user friendliness is one of the success

stories of Nokia and it can be used to good effect by Nokia against its rivals.

Combination of two or more of the above

Nokia can go with one or with the company of all methods mentioned above. It’s

important to Nokia to select the best way to reach the minds of the customers by

picking the most effective plan.

It seems that Nokia is better off using all possible methods for positioning of its new

product N810. They can use their reputation, brand image as successful tools along with

user friendliness, features to good effect to go deep in to the minds of the customers.

There is an additional technique which can be supportive in coming up with product

positioning that can be done by answering a set of questions regarding the positioning

statement.

1. For whom the product is designed?

2. What kind of product it is?

3. What is the single most benefit it offers?

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4. What is its most important competitor?

5. How is your product differentiating from the competitor?

6. What is the significant customer benefit of that difference?

(Source: www.jpec.org)

“Positioning maps help you to visualize your products in the market place, relative to

competitive products, customer needs and even the other products in your product

line”(www.smartdraw.com). This statement clearly indicates it’s better for the Nokia to

come up with a positioning map which will give them a clear indication as to where they

stand.

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Nokia N810 Blackberry

Apple I-Phone

Sony Ericsson

http://www.smartdraw.com/

http://www.jpec.org/


References

Books

Lindquist, J. D & Sirgy, M. J (2003), Shopper, Buyer, and Consumer

Behaviour, 2nd Edition, Biztantra Publications, an Imprint of Atomic

Dog Publishing, India.

Solomon, M. R (2007), Consumer Behaviour, Prentice-Hall

Publications, India

Kotler, P & Keller, K. L (2006), Marketing Management, Pearson

Education, India.

Kotler, P & Armstrong, G (2006), Principles of Marketing, Prentice-

Hall Publications, India.

Websites

Nokia Corporation [Online] Available: http://europe.nokia.com/ [Accessed 13h

September 2009]

Anon. (2007). Product Positioning diagram matrix. Available:

www.smartdraw.com/.../Working-Smarter-with-Positioning-Matrix.pdf. Last

accessed 20 September 2009.

Anon. (2008). Segment Bounding. Available:

homepages.wmich.edu/~lindquis/.../cbch1.ppt. Last accessed 21 September 2009.

Anon. (2009). Market Segmentation. Available:

http://blog.themarketinganalysts.com/wp-content/uploads/2009/06/market-

segmentation1.jpg. Last accessed 21 September 2009.

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http://europe.nokia.com/


niblets.com. (2009). segment viability. Available:

http://www.niblettes.com/blog/wp-images/inline/inpd_niblettes.gif. Last accessed

22 September 2009.

fastfacility.com. (2007). concentrated marketing. Available:

http://www.fastfacility.com/images/postcard_collage_smaller_1.jpg(concentrated)

. Last accessed 23 September 2009.

sobevent.com. (2009). positioning. Available: http://www.sobevent.com/wp-

content/uploads/2008/10/positioning.jpg. Last accessed 24 September 2009.

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