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.
6. Production Orientation
• From the 1850s to the late 1920s
• Companies focus on production capabilities
• Consumer demand exceeded supply
7. Sales Orientation
• From the 1930s to the mid 1950s
• Focus on selling
• Supply exceeded customer demand
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. Discussion Questions
1. What two companies do
you believe grasp and use
the marketing concept?
2. Why do you believe this?
11. The Marketing Concept
Embracing the Marketing
Concept
•
•
•
•
Consumer Research
Segmentation
Market Targeting
Positioning
• The process and tools
used to study consumer
behavior
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. 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. 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. 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
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. Discussion Questions
• How does McDonald’s
create value for the
consumer?
• How do they
communicate this
value?
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. 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. 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. 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.
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
