Chapter 567 Finale

8/8/2019 Chapter 567 Finale

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Consumer Markets andConsumer Buyer Behavior


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Stimulus-Response Model of

Consumer BehaviorStimuli4PsOther characteristics

economic technological political cultural

BuyerResponseProduct choice

Brand choice

Dealer choice

Purchase timing

Purchase amount

BuyersBlackBoxBuyer characteristics

Buyerdecision process

Goal 1: Learn the consumer market & construct model of buyer behavior


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Characteristics Affecting

ConsumerBehavior Culture

Forms a persons wantsand behavior

Subculture

Groups with shared valuesystems

Social Class

Societys divisions whoshare values, interestsand behaviors

Cultural

Social

Personal

Psychological

Key FactorsKey Factors

Goal 2: Know the four factors that influence consumer buying behavior


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ConsumerBehavior Groups

Membership

Reference

Aspirational Opinion Leaders

Buzzmarketing

Family

Manyinfluencers

RolesandStatus

Cultural

Social

Personal

Psychological




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ConsumerBehavior Age and life cycle

Occupation

Economic situation

LifestyleActivities, interests andopinions

Lifestyle segmentation

Personalityandself-concept

Cultural

Social

Personal

Psychological




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Brand Personality Dimensions

Characteristics AffectingConsumerBehavior

Sincerity Ruggedness

Excitement Competence

Sophistication



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ConsumerBehavior

Motivation

Perception

Learning

BeliefsandattitudesCultural

Social

Personal

Psychological




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Psychological Factors

Motivation A motive isaneedthatissufficiently

pressing todirectthe persontoseek

satisfaction Motivationresearchis basedonFreud;

Looks forhiddenandsubconsciousmotivation

Maslow orderedneeds basedonhowpressing theyare tothe consumer



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Perception Perceptionisthe process by which

people select,organize,andinterpret

information Perception Includes:

Selective attention Consumersscreenoutinformation

Selective distortion People interprettosupport beliefs

Selective retention People retain pointstosupportattitudes



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LearningLearning describes changesinanindividuals behaviorarising fromexperienceLearning occursthrough:

Drives Internal stimulusthat calls foraction

Stimuli Objectsthatmove drive tomotive

Cues Minorstimulithataffectresponse Reinforcement

Feedbackonaction



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Beliefsand AttitudesBelief

adescriptive thoughtabouta brandor

service may be basedonreal knowledge,opinion,or faith

Attitude

describesa persons evaluations, feelingsandtendenciestowardanobjectoridea

Theyare difficultto change



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Typesof Buying

DecisionBehaviorComplex

Highlyinvolved,significant branddifferences Example computer

Dissonance-reducing Highlyinvolved, little branddifferences Example carpeting

Habitual Low involvement, little branddifferences Example salt

Variety-seeking Low involvement,significant perceived branddifferences

Example cookies

Goal 3: Understand types of buying decisions and stages in the process


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The BuyerDecision

Process

Needrecognition

Informationsearch

Evaluationofalternatives

Purchase decision

Postpurchase behavior

Needs can be triggered by:

Internal stimuli Normal needs

become strongenoughtodrivebehavior

External stimuli

Advertisements Friendsof friends

ProcessProcess

StagesStages



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The BuyerDecision

Process

Needrecognition

Informationsearch


Purchase decision


Consumers exhibitheightened attentionoractivelysearchforinformation.

Sourcesofinformation:

Personal

Commercial

Public Experiential

Word-of-mouth

ProcessProcess

StagesStages



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The BuyerDecision

Process

Needrecognition

Informationsearch


Purchase decision


Evaluation procedure dependson the consumer and the buyingsituation.

Most buyers evaluate multipleattributes, eachofwhichisweighted differently.

At the endofthe evaluation

stage,purchase intentions areformed.

ProcessProcess

StagesStages



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The BuyerDecision

Process

Needrecognition

Informationsearch


Purchase decision


Twofactorsintercedebetweenpurchase intentionsand the actualdecision:

Attitudesof others

Unexpectedsituationalfactors

ProcessProcess

StagesStages



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The BuyerDecision

Process

Needrecognition

Informationsearch


Purchase decision


Satisfactionisimportant: Delighted consumers

engage in positive word-of-mouth.

Unhappy customerstellonaverage 11 otherpeople.

It costsmore toattractanew customerthanitdoestoretainan existingcustomer.

Cognitive dissonance iscommon

ProcessProcess

StagesStages



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BuyerDecisionProcess for

New ProductsNew Products Good,service orideathatis

perceived by customersasnew.

Stagesinthe AdoptionProcess Marketersshouldhelp consumers

move throughthese stages.

Goal 4: Comprehend the diffusion & adoption process for new products


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Stages in the Adoption Process


New Products

Awareness

EvaluationInterest

Trial

Adoption



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New ProductsIndividual Differencesin Innovativeness

Consumers can be classifiedinto five

adopter categories, eachof which behavesdifferentlytowardnew products.

ProductCharacteristicsand Adoption Five product characteristicsinfluence the

adoptionrate.



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AdopterCategories

1. Innovators:

2. Early Adopters:

3. EarlyMajority:

4. Late Majority:

5. Laggards:


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Product CharacteristicsProduct Characteristics


New Products

Relative Advantage

Compatibility

Complexity

Divisibility

Communicability



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New ProductsInternational ConsumerBehavior

Values,attitudesand behaviorsdiffer

greatlyinother countries. Physical differences exist whichrequire

changesinthe marketing mix.

Customsvary from countryto country.

Marketersmustdecide the degree to whichthey will adapttheirmarketing efforts.



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BusinessMarketsandBusinessMarketsandBusinessBuyerBehaviorBusinessBuyerBehavior


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DefinitionBusinessBuyerBehavior:

The buying behaviorof organizationsthat buy

goodsandservices foruse inthe productionofother productsandservicesthatare sold,rented,orsuppliedtoothers.

Alsoincludedare retailing and wholesaling firmsthatacquire goods forthe purpose of reselling orrenting themtoothersata profit.

Goal 1: Define the business market


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Salesinthe businessmarket far exceedsalesin consumermarkets.

Businessmarketsdiffer from consumer

marketsinmany ways. Marketing structure anddemand

Nature of the buying unit

Typesof decisionsandthe decision process

Characteristicsof

BusinessMarkets



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BusinessMarkets

Comparedtoconsumermarkets:

Businessmarkets have fewer but larger

customers

Business customers are more

geographicallyconcentrated

Demandisdifferent Demandisderived Demandis priceinelastic

Demand fluctuatesmore

CharacteristicsCharacteristics


MarketingStructureandDemand

Nature of theBuying Unit

Typesof Decisionsandthe Decision Process


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BusinessMarkets

MarketingStructureand DemandNature oftheBuying UnitTypes ofDecisionsand

the Decision Process

Comparedto consumerpurchases:

Involve more buyersinthe decision process

More professionalpurchasing effort




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BusinessMarkets

MarketingStructureand DemandNature oftheBuying UnitTypes ofDecisionsand

the Decision Process

Comparedto consumerpurchasesMore complex buyingdecisions

The buying processismore formalized

Buyersandsellers workmore closelytogetherand

build long-termrelationships




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MajorTypesof Buying Situations

Straightrebuy Reordering without modification

Modifiedrebuy

Requires modification to priorpurchase

New task

First-time purchase

BusinessBuyerBehavior



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SystemsSelling Buying a packagedsolutiontoa

problem fromasingle seller. Oftenakeymarketing strategy for

businessesseeking to winandholdaccounts.



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Buying Center The decision-making unitof a buying

organization Includesall individualsandunitsthat participate inthe decisionmaking



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Members of the Buying Center


Users

BuyersInfluencers

Deciders

Gatekeepers



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Major Influenceson

BusinessBuyers

Environmental

Organizational

Interpersonal

Individual

Economic trends

Supply conditionsTechnological,politicaland competitivechangesCulture and customs


Goal 2: Identify the major factors that influence business buyer behavior


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Major Influenceson

BusinessBuyers

Environmental

Organizational

Interpersonal

Individual

Objectives

PoliciesProceduresOrganizationalstructure

Systems




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Major Influenceson

BusinessBuyers

Influence of

membersinthebuying center

Authority Status Empathy Persuasiveness



Environmental

Organizational

Interpersonal

Individual


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Major Influenceson

BusinessBuyers

Personal characteristicsofmembersinthe buyingcenter

Age andincome Education Job position Personality Riskattitudes

Buying styles



Environmental

Organizational

Interpersonal

Individual


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Stagesinthe Business

Buying ProcessStage 1:ProblemRecognition

Stage 2:General NeedDescription

Stage 3:ProductSpecification Value analysishelpstoreduce costs

Stage 4:SupplierSearch

Supplierdevelopment

Goal 3: List and define the steps in the business buying decision process


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Stage 5:Proposal Solicitation

Stage 6:SupplierSelectionStage 7:Order-RoutineSpecification Blanket contractsare oftenused for

maintenance,repairandoperatingitems.

Stage 8:Performance Review

Stagesinthe Business

Buying Process

Goal 3: List and define the steps in the business buying decision process


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InstitutionalMarkets Consistof churches,schools,

prisons,hospitals,nursing homesandotherinstitutionsthat provide

goodsandservicesto people intheircare.

Institutional andGovernmentMarkets

Goal 4: Compare the institutional and government markets


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InstitutionalMarkets Often characterized by low budgets

and captive patrons.

Marketersmaydevelop separate

divisionsandmarketing mixestoservice institutional markets.

Institutional andGovernmentMarkets

Goal 4: Compare the institutional and government markets


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Customer DrivenMarketingStrategy:Creating Value for Target

Customer


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Definition

Market Segmentation:Market Segmentation:

Dividing a market into distinct

Dividing a market into distinctgroups with distinct needs,groups with distinct needs,

characteristics,characteristics,or behavior whoor behavior whomight requiremight require

separate productsseparate productsor marketingor marketingmixes.mixes.


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StepsinMarketSegmentation,Targeting,

andPositioning


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MarketSegmentation

SegmentingSegmentingConsumer MarketsConsumer Markets

SegmentingSegmentingBusiness MarketsBusiness Markets

SegmentingSegmenting

InternationalInternationalMarketsMarkets

Requirements forRequirements forEffectiveEffectiveSegmentationSegmentation

GeographicalGeographicalsegmentationsegmentation Marketing mixes areMarketing mixes are

customizedcustomizedgeographicallygeographically

DemographicDemographicsegmentationsegmentation

PsychographicPsychographic

segmentationsegmentationBehavioralBehavioralsegmentationsegmentation

Using multipleUsing multiplesegmentation variablessegmentation variables

Key TopicsKey Topics


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MarketSegmentation

GeographicGeographicSegmentationVariablesSegmentationVariables

City orCity or

Metro SizeMetro Size

NeighborhoodNeighborhood

DensityDensity

ClimateClimate

World RegionWorld Region

or Countryor Country

CountryCountry

RegionRegion

CityCity


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MarketSegmentation






Geographical segmentsGeographical segments

DemographicDemographicsegmentationsegmentation Most popular typeMost popular type

Demographics are closelyDemographics are closelyrelated to needs, wantsrelated to needs, wantsand usage ratesand usage rates


segmentationsegmentationBehavioralBehavioralsegmentationsegmentation

Using multipleUsing multiplesegmentation variablessegmentation variables



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MarketSegmentationDemographicDemographic

SegmentationVariablesSegmentationVariablesAgeAge

GenderGender

Family sizeFamily sizeFamily life cycleFamily life cycle

IncomeIncome

EthnicityEthnicity

OccupationOccupation

EducationEducation

ReligionReligionGenerationGeneration

NationalityNationality


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MarketSegmentation






Geographic segmentsGeographic segments

DemographicDemographicsegmentationsegmentation

PsychographicPsychographicsegmentationsegmentation Lifestyle, social class,Lifestyle, social class,

and personalityand personality--basedbasedsegmentationsegmentation

BehavioralBehavioralsegmentationsegmentation

Using multipleUsing multiplesegmentationsegmentationvariablesvariables



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MarketSegmentation







DemographicDemographic

segmentationsegmentation



BehavioralBehavioral


Typically done firstTypically done first

Using multipleUsing multiple


variablesvariables



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MarketSegmentationBehavioralBehavioral

SegmentationVariablesSegmentationVariablesOccasionsOccasions

BenefitsBenefits

User StatusUser Status

User RatesUser Rates

Loyalty StatusLoyalty Status

Readiness StageReadiness Stage

Attitude TowardAttitude Toward

the Productthe Product


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MarketSegmentation







DemographicDemographic




BehavioralBehavioral


Using multipleUsing multiple


variablesvariables



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MarketSegmentation






Demographic segmentationDemographic segmentation

Industry, company size,Industry, company size,

locationlocation

Operating variablesOperating variables Technology, usage status,Technology, usage status,

customer capabilitiescustomer capabilities

Purchasing approachesPurchasing approaches

Situational factorsSituational factors

Urgency, specificUrgency, specificapplication, size of orderapplication, size of order

Personal characteristicsPersonal characteristics

BuyerBuyer--seller similarity,seller similarity,

attitudes toward risk, loyaltyattitudes toward risk, loyalty



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MarketSegmentation






Geographic segmentationGeographic segmentation

Location or regionLocation or region

Economic factorsEconomic factors

Population income or level ofPopulation income or level ofeconomic developmenteconomic development

Political and legal factorsPolitical and legal factors

Type / stability ofType / stability of

government, monetarygovernment, monetary

regulations, amount ofregulations, amount of

bureaucracy, etc.bureaucracy, etc.

Cultural factorsCultural factors

Language, religion, values,Language, religion, values,

attitudes, customs,attitudes, customs,

behavioral patternsbehavioral patterns



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MarketSegmentation






MeasurableMeasurable

Size, purchasing power, andSize, purchasing power, and

profile of segmentprofile of segment

AccessibleAccessible Can be reached and servedCan be reached and served

SubstantialSubstantial

Large and profitable enoughLarge and profitable enough

to serveto serve

DifferentiableDifferentiable Respond differentlyRespond differently

ActionableActionable

Effective programs can beEffective programs can be

developeddeveloped



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TargetMarketing

Evaluating Market SegmentsEvaluating Market Segments

Segment size and growthSegment size and growth Segment structural attractivenessSegment structural attractiveness

Level of competitionLevel of competition

Substitute productsSubstitute products

Power of buyersPower of buyers

Powerful suppliersPowerful suppliers

Company objectives and resourcesCompany objectives and resources


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TargetMarketingStrategies


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TargetMarketing

Choosing a TargetChoosing a Target--

Marketing StrategyMarketing Strategy

Requires Consideration of:Requires Consideration of:

Company resourcesCompany resources

The degree of product variabilityThe degree of product variability

Products life

Products life

--cycle stagecycle stage

Market variabilityMarket variability

Competitors marketingCompetitors marketing

strategiesstrategies


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Positioning

Positioning:Positioning:

The place the product occupies inThe place the product occupies in

consumers minds relative to competingconsumers minds relative to competing

products.products.

Typically defined by consumers on the basisTypically defined by consumers on the basis

of important attributes.of important attributes.


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Positioning

Choosing a Positioning Strategy:Choosing a Positioning Strategy:

Identifying possible competitiveIdentifying possible competitiveadvantagesadvantages ---- many potentialmany potentialsources of differentiation exist:sources of differentiation exist:

ProductsProducts

ServicesServices

ChannelsChannels

PeoplePeople

ImageImage


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Positioning


Choosing the right competitiveChoosing the right competitiveadvantageadvantage

How many differences to promote?How many differences to promote?

Unique selling propositionUnique selling proposition

Positioning errors to avoidPositioning errors to avoid

Which differences to promote?Which differences to promote?


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PositioningCriteria forMeaningful DifferencesCriteria forMeaningful Differences

ImportantImportant

SuperiorSuperior

PreemptivePreemptive

DistinctiveDistinctive

CommunicableCommunicable

AffordableAffordable

ProfitableProfitable


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Positioning


Communicating and delivering theCommunicating and delivering thechosen positionchosen position

Entire marketing mix must support theEntire marketing mix must support the

chosen strategychosen strategy

May require changes to the product,May require changes to the product,pricing, distribution or promotion.pricing, distribution or promotion.

Chapter 567 Finale

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