0
CHAPTER
ONE
Consumer Behavior: Meeting Changes and
Challenges
To Which Segment of
Consumers Will This Ad Appeal?
Consumer Behavior
• The behavior that consumers display in
searching for, purchasing, using, evaluating,
and disposing of ...
Two Consumer Entities
Development of the
Marketing Concept
Production Orientation
• From the 1850s to the late 1920s
• Companies focus on production capabilities
• Consumer demand e...
Sales Orientation
• From the 1930s to the mid 1950s
• Focus on selling
• Supply exceeded customer demand
Marketing Concept
• 1950s to current - Focus on the customer!
• Determine the needs and wants of specific
target markets
•...
Discussion Questions
1. What two companies do
you believe grasp and use
the marketing concept?
2. Why do you believe this?
Societal Marketing Concept
• Considers consumers’
long-run best interest
• Good corporate
citizenship
The Marketing Concept
Embracing the Marketing
Concept
•
•
•
•

Consumer Research
Segmentation
Market Targeting
Positioning...
The Marketing Concept
Implementing the
Marketing Concept
•
•
•
•

Consumer Research
Segmentation
Market Targeting
Position...
Discussion Questions
1. What products that you regularly purchase
are highly segmented?
2. What are the different segments...
The Marketing Concept
Implementing the
Marketing Concept
•
•
•
•

Consumer Research
Segmentation
Market Targeting
Position...
The Marketing Concept
Implementing the
Marketing Concept
•
•
•
•

Consumer Research
Segmentation
Market Targeting
Position...
The Marketing Mix
Customer Value, Satisfaction, Trust,
and Retention
Successful Relationships
Value, Satisfaction,
• Defined as the ratio
Trust, and Retention between the customer’s
• Custome...
Discussion Questions
• How does McDonald’s
create value for the
consumer?
• How do they
communicate this
value?
Successful Relationships
Value, Satisfaction,
Trust, and Retention
• Customer
Value
• Customer
Satisfaction
• Customer
Tru...
Successful Relationships
Value, Satisfaction,
Trust, and Retention
• Customer Value
• Customer
Satisfaction
• Customer Tru...
Successful Relationships
Value, Satisfaction,
Trust, and Retention
• Customer Value
• Customer
Satisfaction
• Customer Tru...
THE TRADITIONAL MARKETING CONCEPT

VALUE- AND RETENTION-FOCUSED
MARKETING

Make only what you can sell instead of trying
t...
Impact of Digital Technologies
Consumer Behavior Is
Interdisciplinary
A Simple Model of Consumer Decision Making - Figure 1.4
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Adv375 chapter one

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  • Marketers try to group people together, and be right about it
    Breaking up markets into groups to understand people better
    This particular ad is pointing toward an environmentally concerned person
  • Most of the time, we will be talking about personal consumers
    ***Example, MSU will has to purchase furniture , desk, and chairs for the classrooms—they want to get the cheapest thing,
    When msu bought things, they were told thing like they wont be loosing chairs, they are attached to desks
  • OLD DAYS
    bring a product to the market was a big deal
    THEN
    There was plenty of product..so the focus was on sales
    NOW
    More consumer education, and realizing advertisers are just trying to get you to buy. Power is in the consumers hands.
    EXAMPLE—we have to convince the consumer that they will be happier if they buy the product bc it is satisfied their need
  • There use to be not as much completion. Challenge of trying to make consumers happy with your brand ad stick with it
  • What brands understand the marketing concept?? And understand their customers needs and to satiety.
    —Apple, they redesigned their product (front camera), trade in old to get new one
    Chipotle (cheap, fast, healthier)
    Zappos—free shipping both ways
    Coca Cola—they own vitamin water because they know people will try and be healthy, different product lines to accommodate everyone
  • Lead based pain is an example.
    In the long run will it harm us or bankrupt us?
    Good citizenship
    Consumers are able to demand this. They can just look up review online
  • Consumer research
    Consumer research—How consumer uses their products to get insight (Example apple and front camera on apple phone
  • Segmentation—example McDonalds, college students when they are drunk and they want greasy food, McDonalds café for the working business person
  • Tacobell- appeals to late night drinkers, and weird schedules
    Old navy– clothing for all ages and different ads for then.. Fun and colorful clothing for college students, older age with children ads saying clothing that is affordable for your family. Each ad is appropriate
  • Tailored message for age groups. Imagery might be diffeent
  • Unique propositions for each place
    walmart_regular sizes. 2,4 6, 8. cheap
    VS
    oldnavy different cuts. Boot leg, skinny.
    VS
    ann taylor look good longer. Easy to dress up. When wearing them others will know the sticking and know you can afford it
    Size options for each might be different.
  • Marking mix includes
    —product
    —price
    —place (exclusivity of the store. You cant go in without an appointment)
    —Promotion (wont buy things on sale. Ego boost knowing you can afford it)
  • Value of retaining customers is better to td then to getting new customers. More cost effective to keep customers than to get new ones
    Think of it like a romantic relationship
  • example.—calendar in iphone‚ alarms and reminders when you are busy. You didn’t need to read a manual. Will you have to If you get a new phone. It was expensive but worth it
    Perceived value—alternative options. How good the iphone calendar is to a paper calendar. Subjective VS Relative
  • Value proposition—consistent in their product, you know what you are going to get
  • When customers are highly satisfied, they can become loyalists who continue to purchase or apostles, who provide very positive word-of-mouth. When customers are disappointed, they can become defectors and move to the competition or terrorists, who spread negative word-of-mouth.
    Someone likes a brand, we call them brand loyal
    Apostles, activates for a brand and you talk about it lot
    Defectors- get away from a brand and don’t like it anymore
    Terrorists-hate a brand so much you post on their wall saying you hate them
  • You need trust, no lying stores. If they go out of their way, you might take them back
  • More efficient to keep their current users.
    Position word of mouth—free advertising.
  • Retaining valued customers is most important
  • Marketers
    —customization through technology
    Consumers
    —technology provides power and information by
    allowing them to look things up
  • Psychology-the study of human behavior
    Economics
    (micro)- economics on a smaller scale
    (macro)- finances of a big scale
  • Input-the weather is cold out, socionomic decisions
    Process-recognize the need (its cold, need jacket, search for information ((look for stores, coupons, evaluate alternatives), output-got one and last one didn’t fit, and then the process goes around again!
    PURCHAS DECISIONS! This is always done no matter how small
  • Transcript of "Adv375 chapter one"

    1. 1. CHAPTER ONE Consumer Behavior: Meeting Changes and Challenges
    2. 2. To Which Segment of Consumers Will This Ad Appeal?
    3. 3. Consumer Behavior • The behavior that consumers display in searching for, purchasing, using, evaluating, and disposing of products and services that they expect will satisfy their needs.
    4. 4. Two Consumer Entities
    5. 5. Development of the Marketing Concept
    6. 6. Production Orientation • From the 1850s to the late 1920s • Companies focus on production capabilities • Consumer demand exceeded supply
    7. 7. Sales Orientation • From the 1930s to the mid 1950s • Focus on selling • Supply exceeded customer demand
    8. 8. Marketing Concept • 1950s to current - Focus on the customer! • Determine the needs and wants of specific target markets • Deliver satisfaction better than competition
    9. 9. Discussion Questions 1. What two companies do you believe grasp and use the marketing concept? 2. Why do you believe this?
    10. 10. Societal Marketing Concept • Considers consumers’ long-run best interest • Good corporate citizenship
    11. 11. The Marketing Concept Embracing the Marketing Concept • • • • Consumer Research Segmentation Market Targeting Positioning • The process and tools used to study consumer behavior
    12. 12. The Marketing Concept Implementing the Marketing Concept • • • • Consumer Research Segmentation Market Targeting Positioning • Process of dividing the market into subsets of consumers with common needs or characteristics
    13. 13. Discussion Questions 1. What products that you regularly purchase are highly segmented? 2. What are the different segments? 3. Why is segmentation useful to the marketer for these products?
    14. 14. The Marketing Concept Implementing the Marketing Concept • • • • Consumer Research Segmentation Market Targeting Positioning The selection of one or more of the segments identified to pursue
    15. 15. The Marketing Concept Implementing the Marketing Concept • • • • Consumer Research Segmentation Market Targeting Positioning • Developing a distinct image for the product in the mind of the consumer • Successful positioning includes: – Communicating the benefits of the product – Communicating a unique selling proposition
    16. 16. The Marketing Mix
    17. 17. Customer Value, Satisfaction, Trust, and Retention
    18. 18. Successful Relationships Value, Satisfaction, • Defined as the ratio Trust, and Retention between the customer’s • Customer Value • Customer Satisfaction • Customer Trust • Customer Retention perceived benefits and the resources used to obtain those benefits • Perceived value is relative and subjective • Developing a value proposition is critical
    19. 19. Discussion Questions • How does McDonald’s create value for the consumer? • How do they communicate this value?
    20. 20. Successful Relationships Value, Satisfaction, Trust, and Retention • Customer Value • Customer Satisfaction • Customer Trust • Customer Retention • The individual's perception of the performance of the product or service in relation to his or her expectations. • Customer groups based on loyalty include loyalists, apostles, defectors, and terrorists.
    21. 21. Successful Relationships Value, Satisfaction, Trust, and Retention • Customer Value • Customer Satisfaction • Customer Trust • Customer Retention • Establishing and maintaining trust is essential. • Trust is the foundation for maintaining a longstanding relationship with customers.
    22. 22. Successful Relationships Value, Satisfaction, Trust, and Retention • Customer Value • Customer Satisfaction • Customer Trust • Customer Retention • The objective of providing value is to retain highly satisfied customers. • Loyal customers are key – They buy more products – They are less price sensitive – Servicing them is cheaper – They spread positive word of mouth
    23. 23. THE TRADITIONAL MARKETING CONCEPT VALUE- AND RETENTION-FOCUSED MARKETING Make only what you can sell instead of trying to sell what you make. Use technology that enables customers to customize what you make. Do not focus on the product; focus on the need that it satisfies. Focus on the product’s perceived value, as well as the need that it satisfies. Market products and services that match customers’ needs better than competitors’ offerings. Utilize an understanding of customer needs to develop offerings that customers perceive as more valuable than competitors’ offerings. Research consumer needs and characteristics. Research the levels of profit associated with various consumer needs and characteristics. Understand the purchase behavior process and the influences on consumer behavior. Understand consumer behavior in relation to the company’s product. Realize that each customer transaction is a discrete sale. Make each customer transaction part of an ongoing relationship with the customer.
    24. 24. Impact of Digital Technologies
    25. 25. Consumer Behavior Is Interdisciplinary
    26. 26. A Simple Model of Consumer Decision Making - Figure 1.4
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