Inroduction to Consumer Behavior.ppt

7/27/2019 Inroduction to Consumer Behavior.ppt

1/34

CONSUMER BEHAVIORAn Introduction


2/34

LEARNING CONCEPTS

Definition of CB

Consumer primacy

Environmental analysis

Positioning/differentiation

Segmentation

Theory and CB

Research perspectives

on consumer behavior

Exchange processes

Organizing model of

consumer behavior


3/34

Consumer Behavior . . .

. . . is defined as the

study of the buying

units and the exchange

processes involved inacquiring, consuming,

and disposing of goods,

services, experiences,

and ideas.


4/34

What is the difference between:

Consumer

Customer

Client


5/34

Consumers, Customers & Clients

Consumers are for products while customers arefor brands

For example, we are all consumers of cell

phones, but customers of differentcompanies/brands like Nokia, Samsung, Q-Mobile etc.

Client is a customer for whom the company

makes an effort to build long-term relationship(relationship marketing) primarily used inservice industries


6/34

Consumer Roles

Initiator

Influencer

Decision Maker

Buyer User


7/34

Three Research Perspectives on

Consumer Behavior

The Decision-Making Perspective

The Experiential Perspective

The Behavioral Influence Perspective


8/34

The Decision-Making Perspective . . .

. . . proposes that

buying results from

consumers perceiving

that they have aproblem and then they

move through a series

of rational steps to

solve the problem

Problem Recognition

Search

Alternative Evaluation

Choice

Post-acquisition

Evaluation

Generic Decision Model


9/34

The Experiential Perspective.

. . . proposes that in

some instances buying

results from the

consumers need for fun,

to create fantasies,

obtain emotions, and

feelings,

relates to the conceptof Hedonistic

consumption


10/34

The Behavioral InfluencePerspective . . .

. . . assumes that strong environmental forces propel

consumers to make purchases without necessarily first

developing strong feelings or beliefs about the

product.


11/34

Exchange Processes and

Consumer Behavior

Exchange is the

process that involvesthe transfer ofsomething tangible orintangible, actual or

symbolic, betweentwo or more socialactors.


12/34

Prerequisites for Exchange:

Two or more parties must be present

Each party has something of value to the other

Each party is capable of communication and delivery

Each party must be free to accept or reject the other'soffer

Each party must believe that it is appropriate or

desirable to deal with the other


13/34

Elements of Exchange

Six Types of Resources Are Exchanged:

Goods

Service

Money

Information

Status

Feelings


14/34

Dimensions of Exchange Relations

Four types of consumer exchange relations have been

identified:

Restricted versus Complex Exchange

Internal versus External Exchange

Formal versus Informal Exchange

Relational versus Discrete Exchange


15/34

Relational Exchange Current hot topic in marketing

Characteristics

long term

reciprocal obligations

non-economic rewards: market embedding - social ties between buyer

and seller increase perceived value of exchange. extensive formal and informal communication

high interdependence

planning

Relational exchange is also practiced between members of

marketing channel


16/34

Application Areas of Consumer

Behavior

Environmental Analysis

Marketing Research

Segmentation of the Market place

Product Positioning and Differentiation

Marketing-Mix Development


17/34

Product Positioning . . .

. . . is influencing how consumers perceive a brandscharacteristics relative to those of competitive offerings

Goal is to influence demand by creating a product with specific

characteristics (i.e. brand attributes) and a clear image thatdifferentiates it from competitors


18/34

Positioning Strategies

Attribute Positioning

Positioning a brand by creating linkages between brand and key

attributes and benefits. E.g., acceleration, reliability etc. for an

automobile

Competitive Positioning

Positioning a brand in relation to competitors. E.g. Coca Cola & PepsiCola

Away from the Competitor

Positioning the brand for a relatively small, uncontested segment that

is being ignored by major industry players. E.g. Pakola

Psychological Positioningpositioning a brand based upon dominant personality characteristic of

target market. E.g. Do the Dew

Category Positioning

Positioning the brand as the pioneer in such a manner that the brand

name becomes representative of the product category. E.g. Saniplast


19/34

Environmental Analysis . . .

. . . is the assessmentof the external forcesthat act upon the firmand its customers,and that create

threats andopportunities


20/34

The Natural Environment . . .

. . . includes the types of

raw materials available,

pollution, consumer fear

of contracting deadlydiseases, the expansion

of desert regions around

the globe, and various

weather phenomena,such as hurricanes or

drought


21/34

The Economic Environment Set of factors involving monetary, natural, and

human resources that influence firms/consumers. Behavioral Economics: Study of economicdecisions made by individual consumers and thebehavioral determinants of those decisions.

Major Contributions of Behavioral Economists: Originated and documented the idea that the consumer

sector of the economy can strongly influence the courseof the aggregate economy

Investigated what factors influence the decision offamilies to buy or save


22/34

The Technological Environment

Goal is to anticipatewhat changes in thetechnologicalenvironment willoccur and how thesewill influence thelifestyle and

consumption patternsof consumers


23/34

MARKETING RESEARCH . . .

. . . is applied consumer research designed to provide

management with information on factors that impactconsumers acquisition, consumption, and disposition

of goods, services, and ideas


24/34

Product

Promotion

Pricing

Distribution

Marketing-Mix Development .. . . involves the development andcoordination of activities involving the:


25/34

Promotional Mix

Advertising

Personal Selling Direct Marketing

Sales Promotion

Publicity & PublicRelations

Word-of-mouth


26/34

Price Changes

Predicting the likely impact of price changes onconsumers is an important consumer behavior area: How will consumers react when companies raise or lower the price

of a product?

Principles of perception can be applied to analyze if consumers willnotice a difference in price and if so, what effect it will have on theirbuying behavior


27/34

Product Distribution . . .

. . . will be influenced by

understanding how

consumers make their

purchasing decisions.For Example: For low

involvement decisions

(e.g., purchasing a soft

drink), the company mustuse extensive distribution


28/34

Market Segmentation . . .. . . involves subdividing the market place

into distinct subsets of customers havingsimilar needs and wants, each of which can

be reached with a different marketing mix

For a segment to be useful it should have:

1. Measurability: Assess needs and wants throughdemographic, psychographic, attitude andpersonality measures

2. Accessibility: Customers must be reachable bymarketing mix

3. Substantiality: Size and income to generatesufficient sales


29/34

Four Classifications of

Segmentation Variables:

Characteristics of the Person

Nature of the situation in which the product orservice may be purchased

Geography

Culture and Subculture adopted by the consumer


30/34

Characteristics of the Consumer

Demographic Characteristics

Behavioral Segmentation: price elasticity,

benefits sought, usage rate & pattern, brandloyalty

Psychographic and Personality Characteristics


31/34

Demographics is . . .

. . . the study of population changes and sub-cultural values of various demographic groups

based on such factors as age, gender, income,education, ethnicity, geography, nationality,household size, marital status, religion,occupation, etc.


32/34

Consumer Situations . . .

. . . consist of the temporary environmental factors that

form the context within which a consumer activity

occurs at a particular time and place

Types of situations: Social, physical, temporal, task

defined


33/34

Geographic Segmentation

Can include region,

size of cities and

counties, censusblocks, population

density, and climate

Geo-demographics is

the combination ofgeography and

demographics


34/34

Culture and Subculture

Culture is the way of life followed by the people in a

society

Subculture is a subdivision of a national culture and is

based on some unifying characteristics, such as

nationality, religion, ethnicity etc.

Inroduction to Consumer Behavior.ppt

Documents

Transcript of Inroduction to Consumer Behavior.ppt