Chapter 4 -Managing Marketing Information to Gain Customer Ins

Chapter 4 -Managing Marketing Information to Gain Customer
Insights
Strategic Marketing, MASY1-GC 1230
Marketing Research at P&G: Creating Innovative Brands that
provide “Irresistibly Superior Experiences”
To gain deep consumer insights, P&G employs a wide range of
marketing research.
Art and science of consumer immersion research—“Living It”—
in which small teams of P&G staffers live, work, and shop with
consumers to gain deep insights into what they think, feel, need,
and do
Traditional surveys and focus groups
Digital research platforms: online panels, web tracking, mobile
surveys to big data collection and analytics
P&G uses innovative marketing research—lots and lots of it—to
dig out deep and fresh consumer insights and then uses the
insights to create transformational brands and marketing that
deliver irresistibly superior experiences for consumers.
To gain deep consumer insights, P&G employs a wide range of
marketing research approaches—from traditional large-scale
surveys and small-scale focus groups to real-time social media
listening, mobile surveys, and big data analytics.
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Marketing Information
Customer needs and motives for buying are difficult to
determine.
Required by companies to obtain customer and market insights
Provides competitive advantage
Generated in great quantities with the help of information
technology and online sources
Most marketing managers are overloaded with data and often
overwhelmed by it. Marketers don’t need more information;
they need better information. And they need to make better use
of the information they already have.
The real value of marketing research and marketing information
lies in how it is used—in the customer insights that it provides.
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Today’s “Big Data”
Big data refers to the huge and complex data sets generated by
today’s sophisticated information generation, collection,
storage, and analysis technologies.
Big data presents marketers with both big opportunities and big
challenges. Companies that effectively tap this glut of big data
can gain rich, timely customer insights.
Far from lacking information, most marketing managers are
overloaded with data. Accessing and sifting through so much
data is a daunting task. For example, when a large consumer
brand such as Coca-Cola or Apple monitors online discussions
about its brand in Tweets, blogs, social media posts, and other
sources, it might take in a stunning 6 million public
conversations a day, more than 2 billion a year.

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Customer Insights
Fresh marketing information-based understandings of customers
and the marketplace
Become the basis for creating customer value, engagement, and
relationships
Customer insights teams collect customer and market
information from a wide variety of sources.
Many companies are now restructuring their marketing research
and information functions. They are creating customer insights
teams which collect customer and market information from a
wide variety of sources, ranging from traditional marketing
research studies to mingling with and observing consumers to
monitoring consumer online conversations about the company
and its products. This information is then used to develop
important customer insights from which the company can create
more value for its customers.
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Customer Insights (CONT’D)
PepsiCo’s various marketing research departments are
integrated “customer insights teams”.
Consumer insights: PepsiCo’s “consumer insights teams” wring
actionable insights out of the glut of marketing data. They have
even developed a consumer insights app to share custom
designed content with brand decision makers.
Beyond just transmitting data and findings through traditional
fact based presentations, reports, and spreadsheets, the
Consumer Insights teams share their insights in more engaging,
accessible, and digestible ways.

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Marketing Information System (MIS)
Consists of people and procedures to
Assess information needs
Develop the needed information
Help decision makers use the information to generate and
validate actionable customer and market insights
It is essential for companies to design effective marketing
information systems that give managers the right information, in
the right form, at the right time and help them to use this
information to create customer value, engagement and stronger
customer relationships.
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The Marketing Information System
This figure shows that the MIS begins and ends with
information users.
The information users are marketing managers, internal and
external partners, and others who need marketing information.
Marketers start by assessing user information needs. Next, they
develop needed information using internal company databases,
marketing intelligence activities, and marketing research.
Finally, the MIS helps users to analyze and use the information
to develop customer insights, make marketing decisions, and
manage customer engagement and relationships.
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Assessing Marketing Information Needs
A good MIS balances the information users would like to have

against
What they really need
What is feasible to offer
Obtaining, analyzing, storing, and delivering information is
costly.
Firms must decide whether the value of the insight is worth the
cost.
Too much information can be as harmful as too little. Some
managers will ask for whatever information they can get
without thinking carefully about what they really need. Other
managers may omit things they ought to know, or they may not
know to ask for some types of information they should have.
The MIS must monitor the marketing environment to provide
decision makers with information they should have to better
understand customers and make key marketing decisions. It is
important for firms to decide whether the value of the insights
gained from the additional information is worth the cost of
providing it. However, it is difficult to assess the value and
cost.
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Developing Marketing Information
Information needed can be obtained from
Internal databases
Competitive marketing intelligence
Marketing research
Marketers can obtain the needed marketing information from
internal data, marketing intelligence, and marketing research.
Each of these sources are discussed in greater depth in the
following slides.
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Internal Databases
Financial services provider USAA uses its extensive database to
tailor its services to the specific needs of individual customers,
creating incredible loyalty.
USAA provides financial services to U.S. military personnel
and their families, largely through direct marketing via the
phone, the internet, and mobile channels. It maintains a huge
customer database built from customer purchasing histories and
information collected directly through customer surveys,
transaction data, and browsing behavior at its web and social
media sites. USAA uses the database to tailor direct marketing
offers to the needs of individual customers.
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Internal Databases (CONT’D)
Internal databases are collections of consumer and market
information obtained from data sources within the company
network.
Internal databases usually can be accessed more quickly and
cheaply than other information sources, but they also present
some problems. Because internal information is often collected
for other purposes, it may be incomplete or in the wrong form
for making marketing decisions. Data also ages quickly;
keeping the database current requires a major effort. Finally,
managing and mining the mountains of information that a large
company produces requires highly sophisticated equipment and
techniques.
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Competitive Marketing Intelligence

Systematic monitoring, collection, and analysis of information
About consumers, competitors, and developments in the
marketing environment
Techniques
Observing consumers first-hand
Quizzing the company’s own employees
Benchmarking competitors’ products
Conducting online research
Monitoring social media buzz
The goal of competitive marketing intelligence is to improve
strategic decision making by understanding the consumer
environment, assessing and tracking competitors’ actions, and
providing early warnings of opportunities and threats.
Good marketing intelligence can help marketers gain insights
into how consumers talk about and engage with their brands.
Many companies send out teams of trained observers to mix and
mingle personally with customers as they use and talk about the
company’s products. Other companies, like MasterCard, have
set up sophisticated digital command centers that routinely
monitor brand-related online consumer and marketplace
activity.
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Competitive Marketing Intelligence (CONT’D)
Offers insights about consumer opinions and their association
with the brand
Provides early warnings of competitor strategies and potential
competitive strengths and weaknesses
Helps firms to protect their own information
Raises ethical issues
Companies can monitor competitors’ Web sites and use the

Internet to search specific competitor names, events, or trends
and see what turns up. Tracking consumer conversations about
competing brands is often as revealing as tracking conversations
about the company’s own brands.
Companies can obtain important intelligence information from
suppliers, resellers, and key customers. Intelligence seekers can
pour through any of the thousands of online databases. For
example, the U.S. Security and Exchange Commission’s
database provides a huge stockpile of financial information on
public competitors, and the U.S. Patent Office and Trademark
database reveals patents that competitors have filed.
Some intelligence gathering techniques may involve
questionable ethics. With all the legitimate intelligence sources
now available, a company does not need to break the law or
accepted codes of ethics to get good intelligence.
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Marketing Research
Systematic design, collection, analysis, and reporting of data
relevant to a specific marketing situation facing an organizati on
Approaches followed by firms:
Use own research departments
Hire outside research specialists
Purchase data collected by outside firms
Companies use marketing research in a wide variety of
situations. For example, marketing research gives marketers
insights into customer motivations, purchase behavior, and
satisfaction. It can help them to assess market potential and
market share or measure the effectiveness of pricing, product,
distribution, and promotion activities.
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The Marketing Research Process
Marketing research follows a process that has four steps:
defining the problem and research objectives; developing the
research plan; implementing the research plan; and interpreting
and reporting the findings. Each of these stages is discussed in
detail in the following slides.
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Defining the Problem and Research Objectives
Exploratory research
Used to gather preliminary information
Helps to define problems and suggest hypotheses
Descriptive research
Used to better describe the market potential for a product or the
demographics and attitudes of consumers
Causal research
Used to test hypotheses about cause-and-effect relationships
Marketing managers and researchers must work together closely
to define the problem and agree on research objectives. The
manager best understands the decision for which information is
needed, whereas the researcher best understands marketing
research and how to obtain the information. Defining the
problem and research objectives is often the hardest step in the
research process.
After the problem has been defined carefully, the manager and
the researcher must set the research objectives.
Managers often start with exploratory research and later follow
with descriptive or causal research. The statement of the
problem and research objectives guides the entire research

process. The manager and the researcher should put the
statement in writing to be certain that they agree on the purpose
and expected results of the research.
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Research Plan
Outlines sources of existing data
Spells out
Specific research approaches
Contact methods
Sampling plans
Instruments that researchers will use to gather new data
Once researchers have defined the research problem and
objectives, they must determine the exact information needed,
develop a plan for gathering information efficiently, and present
the plan to management.
Research objectives must be translated into specific information
needs. For example, suppose that Chipotle Mexican Grill wants
to know how consumers would react to the addition of drive-
thru service to its restaurants. The proposed research might call
for the following specific information:
Demographic, economic, and lifestyle characteristics of current
Chipotle customers
Characteristics and usage patterns of the broader population of
fast-food and fast-casual diners
Impact on the Chipotle customer experience
Chipotle employee reactions to drive-thru service
Forecasts of both inside and drive-thru sales and profits
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Research Plan (CONT’D)
Should be presented in a written proposal

Topics covered in a research plan:
Problems and research objectives
Information to be obtained
How results will help decision making
Estimated research costs
Type of data required
The research plan should be presented in a written proposal. A
written proposal is important when the research project is large
and complex or when an outside firm carries it out.
The proposal should cover the management problems addressed,
the research objectives, the information to be obtained, and how
the results will help management’s decision making. The
proposal should also include estimated research costs.
To meet the manager’s information needs, the research plan can
call for gathering secondary data, primary data, or both.
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Secondary Data
Information that already exists
Collected for another purpose
Sources:
Company’s internal database
Purchased from outside suppliers
Commercial online databases
Internet search engines
Researchers usually start by gathering secondary data. The
company’s internal database provides a good starting point.
Companies can buy secondary data from outside firms that
supply high-quality data to suit a wide variety of marketing
information needs.

The company can also utilize the wide assortment of external
information sources. Using commercial online databases,
marketing researchers can conduct their own searches of
secondary data sources. Internet search engines can also help in
locating relevant secondary information sources. However, they
can also be very frustrating and inefficient.
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Secondary Data (CONT’D)
Advantages
Low cost
Obtained quickly
Cannot collect otherwise
Disadvantages
Potentially Irrelevant
Inaccurate
Dated
Biased
Secondary data can usually be obtained more quickly and at a
lower cost than primary data. Also, secondary sources can
sometimes provide data an individual company cannot collect
on its own, like data that is not available directly or would be
too expensive to collect. For example, it would be too expensive
for Red Bull’s marketers to conduct a continuing retail store
audit to find out about the market shares, prices, and displays of
competitors’ brands.
However, secondary data can also present problems.
Researchers can rarely obtain all the data they need from
secondary sources. For example, Chipotle will not find existing
information regarding consumer reactions about new drive-thru
service that it has not yet installed. Even when data can be
found, the information might not be very usable.

The researcher must evaluate secondary information carefully to
make certain it is relevant, accurate, up-to-date, and impartial.
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Planning Primary Data CollectionResearch
ApproachesContact MethodsSampling PlanResearch
InstrumentsObservationMailSampling
unitQuestionnaireSurveyTelephoneSample sizeMechanical
instrumentsExperimentPersonalSampling procedureOnline
This table shows that designing a plan for primary data
collection calls for a number of decisions on research
approaches, contact methods, the sampling plan, and research
instruments. The following slides discuss each of these
decisions in detail.
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Research Approaches
Observational research
Gathering primary data by observing relevant people, actions,
and situations
Ethnographic research: Sending trained observers to watch and
interact with consumers in their natural environments
Survey research
Asking people questions about their knowledge, attitudes,
preferences, and buying behavior
Experimental research
Selecting matched groups of subjects, giving them different
treatments, controlling related factors, and checking for
differences in group responses
Observational and ethnographic research yield the kinds of
details that don’t emerge from traditional research

questionnaires or focus groups. For instance, Fisher-Price has
established an observation lab in which it can observe the
reactions children have to new toys.
A wide range of companies now use ethnographic research. For
example, Coors insights teams frequent bars and other locations
in a top-secret, small-town location—they call it the
“Outpost”—within a day’s drive of Chicago. The researchers
use the town as a real-life lab.
Survey research is the approach best suited for gathering
descriptive information. The major advantage of survey research
is its flexibility. Surveys addressing almost any marketing
question or decision can be conducted by phone or mail, in
person, or online. The disadvantages of survey research are that
people may be unwilling to respond to unknown interviewers or
answer questions about topics they consider private.
Whereas observation is best suited for exploratory research and
surveys for descriptive research, experimental research is best
suited for gathering causal information. Experimental research
tries to explain cause-and-effect relationships. For example,
before adding a new sandwich to its menu, McDonald’s might
use experiments to test the effects on sales of two different
prices it might charge.
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Primary Data
Landor researchers visit families, peeking into their
refrigerators and diving deeply into their food shopping
behaviors and opinions.
Landor researchers also shop with the families at their local
supermarkets and look over their shoulders while they shop

online. The families furnish monthly online reports detailing
their shopping behaviors and opinions.
The Landor Families study provides rich behavioral insights for
Landor clients such as Danone, Kraft Foods, and Procter &
Gamble.
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Mail, Telephone, and Personal Interviewing
Mail questionnaires are used to collect large amounts of
information at a low cost per respondent.
Telephone interviewing gathers information quickly, while
providing flexibility.
Personal interviewing methods include
Individual interviewing
Group interviewing
Mail questionnaires can be used to collect large amounts of
information at a low cost per respondent. Respondents may give
more honest answers to more personal questions on a mail
questionnaire than to an unknown interviewer. However, mail
questionnaires are not very flexible.
Telephone interviewing is one of the best methods for gathering
information quickly, and it provides greater flexibility than mail
questionnaires. Interviewers can explain difficult questions and,
depending on the answers they receive, skip some questions or
probe on others. However, the method introduces interviewer
bias, which is the way interviewers talk, how they ask
questions, and other differences that may affect respondents’
answers.
Personal interviewing takes two forms: individual interviewing
and group interviewing. Individual interviewing involves
talking with people in their homes or offices, on the street, or in

shopping malls. Such interviewing is flexible. Group
interviewing consists of inviting 6 to 10 people to meet with a
trained moderator to talk about a product, service, or
organization. Group interviewing is also referred to as focus
group interviewing.
Some companies use immersion groups, which are small groups
of consumers who interact directly and informally with product
designers without a focus group moderator present. For
example, The Mom Complex uses “Mom Immersion Sessions”
to help brand marketers understand and connect directly with
their “mom customers” on important brand issues.
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Online Marketing Research
Data is collected through
Internet surveys
Online focus groups
Web-based experiments
Tracking consumers’ online behavior
Increasingly, researchers are collecting primary data through
online marketing research. The Internet is especially well suited
to quantitative research. Advantages of Internet-based surveys
are speed and low costs. Researchers can quickly and easily
distribute surveys to thousands of respondents and responses
can be almost instantaneous. Internet-based surveys also tend to
be more interactive and engaging, easier to complete, and less
intrusive.
A primary qualitative Internet-based research approach is online
focus groups. For example, FocusVision’s InterVu service lets
focus group participants at remote locations see, hear, and react
to each other in real-time, face-to-face discussions.

Both quantitative and qualitative Internet-based research have
some drawbacks. One major problem is controlling who’s in the
online sample. To overcome such sample and context problems,
many online research firms use opt-in communities and
respondent panels. Alternatively, many companies are now
developing their own custom social networks and using them to
gain customer inputs and insights.
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Online Behavioral and Social Tracking and Targeting
Online listening
Provides valuable insights into what consumers are saying or
feeling about a brand
Behavioral targeting
Uses online consumer tracking data to target advertisements and
marketing offers to specific consumers
Social targeting
Mines individual online social connections and conversations
from social networking sites
Tracking consumers online might be as simple as scanning
customer reviews and comments on the company’s brand site or
on shopping sites such as Amazon.com. Or, it might mean using
sophisticated online-analysis tools to deeply analyze the
mountains of consumer brand-related comments and messages
found in blogs or on social media sites. Online listening
provides the passion and spontaneity of unsolicited consumer
opinions.
In a practice called behavioral targeting, marketers use online
data to target ads and offers to specific consumers. For
example, if you place an Apple iPad in your Amazon.com
shopping cart but don’t buy it, you might expect to see some ads
for that very type of device the next time you visit your favorite
ESPN site to catch up on the latest sports scores. Whereas

behavioral targeting tracks consumer movements across online
sites, social targeting mines individual online social
connections and conversations from social networking sites.
Instead of just having a Zappos.com ad for running shoes pop
up because you’ve recently searched online for running shoes
(behavioral targeting), an ad for a specific pair of running shoes
pops up because a friend that you’re connected to via Twitter
just bought those shoes from Zappos.com last week (social
targeting).
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Sampling Plan
A sample is a segment of the population selected to represent
the population as a whole.
Decisions required for sampling design:
Sampling unit - People to be studied
Sample size - Number of people to be studied
Sampling procedure - Method of choosing the people to be
studied
Marketing researchers usually draw conclusions about large
groups of consumers by studying a small sample of the total
consumer population. The sample should be representative of
the population so that the researcher can make accurate
estimates. Designing the sample requires three decisions. First,
who is to be studied (unit)? Second, how many people should be
included (size)? Finally, how should the people in the sample be
chosen (procedure)?
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Types of SamplesTable 4.2 Types of SamplesProbability
SampleSimple random sampleEvery member of the population
has a known and equal chance of selection.Stratified random
sampleThe population is divided into mutually exclusive groups
(such as age groups), and random samples are drawn from each

group.Cluster (area) sampleThe population is divided into
mutually exclusive groups (such as blocks), and the researcher
draws a sample of the groups to interview.Nonprobability
SampleConvenience sampleThe researcher selects the easiest
population members from which to obtain information.Judgment
sampleThe researcher uses his or her judgment to select
population members who are good prospects for accurate
information.Quota sampleThe researcher finds and interviews a
prescribed number of people in each of several categories.
The different types of samples fall under two basic categories:
probability samples and nonprobability samples.
Probability samples include the following.
Simple random sample: Every member of the population has a
known and equal chance of selection.
Stratified random sample: The population is divided into
mutually exclusive groups (such as age groups), and random
samples are drawn from each group.
Cluster (area) sample: The population is divided into mutually
exclusive groups (such as blocks), and the researcher draws a
sample of the groups to interview.
Nonprobability samples include the following.
Convenience sample: The researcher selects the easiest
population members from which to obtain information.
Judgment sample: The researcher uses his or her judgment to
select population members who are good prospects for accurate
information.
Quota sample: The researcher finds and interviews a prescribed
number of people in each of several categories.
When probability sampling costs too much or takes too much

time, marketing researchers take nonprobability samples, even
though their sampling error cannot be measured. The best
method to use depends on the needs of the research project.
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Research Instruments
Questionnaires can be administered in person, by phone, by e-
mail, or online.
Closed-ended questions
Open-ended questions
Mechanical instruments include
People meters
Checkout scanners
Neuromarketing
In collecting primary data, marketing researchers have a choice
of two main research instruments: questionnaires and
mechanical instruments.
A questionnaire is by far the most common instrument used for
research. Closed-ended questions include all the possible
answers, and subjects make choices among them. Open-ended
questions allow respondents to answer in their own words.
Open-ended questions are especially useful in exploratory
research, when the researcher is trying to find out what people
think but is not measuring how many people think in a certain
way. Closed-ended questions, on the other hand, provide
answers that are easier to interpret and tabulate. Researchers
should use care in the wording and ordering of questions.
Mechanical instruments are used to monitor consumer behavior.
For example, Time Warner’s MediaLab uses high-tech
observation to capture the changing ways that today’s viewers
are using and reacting to television and Web content.

Some researchers are applying neuromarketing, which involves
measuring brain activity to learn how consumers feel and
respond. For example, PepsiCo’s Frito-Lay worked with
Nielsen’s NeuroFocus to assess consumer motivations
underlying the success of its Cheetos snack brand.
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Research Instruments (CONT’D)
Using neuroscience methods, Nielsen charted how people’s
brains responded to an existing Shelter Pet Project public
service ad and the ad’s canine star, Jules the dog.
In collecting primary data, marketing researchers have a choice
of two main research instruments: questionnaires and
mechanical instruments.
A questionnaire is by far the most common instrument used for
research. Closed-ended questions include all the possible
answers, and subjects make choices among them. Open-ended
questions allow respondents to answer in their own words.
Open-ended questions are especially useful in exploratory
research, when the researcher is trying to find out what people
think but is not measuring how many people think in a certain
way. Closed-ended questions, on the other hand, provide
answers that are easier to interpret and tabulate. Researchers
should use care in the wording and ordering of questions.
Mechanical instruments are used to monitor consumer behavior.
For example, Time Warner’s MediaLab uses high-tech
observation to capture the changing ways that today’s viewers
are using and reacting to television and Web content.
Some researchers are applying neuromarketing, which involves
measuring brain activity to learn how consumers feel and

respond. Neuromarketing helped improve the effectiveness of
ads for the Shelter Pet Project, increasing viewer attention,
emotional engagement, and memory recall and more than
doubling traffic to the organization’s website.
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Implementing the Research Plan
Data collection
Researchers should guard against various problems.
Techniques and technologies
Data quality
Timeliness
The researcher next puts the marketing research plan into
action. This involves collecting, processing, and analyzing the
information. Data collection can be carried out by the
company’s marketing research staff or outside firms.
Researchers make sure that the plan is implemented correctly
and must guard against problems with data collection techniques
and technologies, data quality, and timeliness.
Researchers must also process and analyze the collected data to
isolate important information and insights. They need to check
data for accuracy and completeness and code it for analysis. The
researchers then tabulate the results and compute statistical
measures.
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Implementing the Research Plan (CONT’D)
Processing the data
Check for accuracy
Code for analysis
Analyzing the data
Tabulate results
Compute statistical measures

The researcher next puts the marketing research plan into
action. This involves collecting, processing, and analyzing the
information. Data collection can be carried out by the
company’s marketing research staff or outside firms.
Researchers make sure that the plan is implemented correctly
and must guard against problems with data collection techniques
and technologies, data quality, and timeliness.
Researchers must also process and analyze the collected data to
isolate important information and insights. They need to check
data for accuracy and completeness and code it for analysis. The
researchers then tabulate the results and compute statistical
measures.
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Interpreting and Reporting Findings
Responsibilities of the market researcher:
Interpret the findings
Draw conclusions
Report findings to management
Responsibilities of managers and researchers:
Work together closely when interpreting research results
Share responsibility for the research process and resulting
decisions
The market researcher must interpret the findings, draw
conclusions, and report them to management. The researcher
should present important findings and insights that are useful in
the major decisions faced by management.
The best research means little if the manager blindly accepts
faulty interpretations from the researcher. In many cases,
findings can be interpreted in different ways, and discussions

between researchers and managers will help point to the best
interpretations. Thus, managers and researchers must work
together closely when interpreting research results, and both
must share responsibility for the research process and resulting
decisions.
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Customer Relationship Management (CRM)
Managing detailed information about individual customers
Carefully managing customer touch points to maximize
customer loyalty
Consists of software and analysis tools that
Integrate customer information from all sources
Analyze data in depth
Apply the results
Customer relationship management (CRM) is used to manage
detailed information about individual customers and carefully
manage customer touch points to maximize customer loyalty.
CRM consists of sophisticated software and analysis tools from
companies such as Salesforce.com, Oracle, Microsoft, and SAS
that integrate customer information from all sources, analyze it
in depth, and apply the results to build stronger customer
relationships.
By using CRM to understand customers better, companies can
provide higher levels of customer service and develop deeper
customer relationships. CRM provides a 360-degree view of the
customer relationship. Firms can use CRM to pinpoint high-
value customers, target them more effectively, cross-sell the
company’s products, and create offers tailored to specific
customer requirements.
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Big Data and Marketing Analytics

Marketing analytics consists of the analysis tools, technologies,
and processes by which marketers dig out meaningful patterns
in big data to gain customer insights and gauge marketing
performance.
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Customer Relationship Management (CRM) (CONT’D)
While avid Netflixers are busy watching Netflix videos, Netflix
is also busy watching them.
Netflix tracks and parses member data on tens of millions of
searches, ratings, and “plays.” The company’s bulging database
contains every viewing detail for each individual subscriber —
real-time data on what shows they watch, at what times, on what
devices, at what locations, even when they hit the pause,
rewind, or fast-forward buttons during programs.
Such analytics employ artificial intelligence (AI), technology
by which machines think and learn in a way that looks and feels
human but with a lot more analytical capacity.
Using this rich base of big data, Netflix builds detailed
individual subscriber profiles and then uses these profiles to
tailor each customer’s viewing experience and make
personalized recommendations.
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Distributing and Using Marketing Information
MIS must make information readily available for decision
making.
Routine information for decision making

Non-routine information for special situations
Intranets and extranets facilitate the information-sharing
process.
The marketing information system must make information
readily available to managers and others who need it, when they
need it. In some cases, this means providing managers with
routine information such as performance reports, intelligence
updates, and reports on the results of research studies. But,
marketing managers also require non-routine information to
make on-the-spot decisions. For example, a sales manager
having trouble with a large customer may want a summary of
the account’s sales and profitability over the past year.
Many firms use company intranet and internal CRM systems to
facilitate the distribution and use of marketing information.
Companies are also increasingly allowing key customers and
value-network members to access account, product, and other
data on demand through extranets.
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Marketing Research in Small Businesses and Nonprofit
Organizations
Obtaining good marketing insights
Secondary data collection
Observation
Surveys
Experiments
Responsibility of managers
Think carefully about the research objectives
Formulate questions in advance
Recognize the biases introduced by smaller samples and less
skilled researchers
Conduct the research systematically

Just like larger firms, small organizations need market
information and the customer insights that it can provide. Many
marketing research techniques can be used by smaller
organizations in a less formal manner and at little or no
expense.
Small businesses and not-for-profit organizations can obtain
good marketing insights through observation or informal
surveys using small convenience samples. They can collect a
considerable amount of information at very little cost online.
They can scour competitor and customer Web sites and use
Internet search engines to research specific companies and
issues.
Although these informal research methods are less complex and
less costly, they still must be conducted with care. Managers
must think carefully about the objectives of the research,
formulate questions in advance, recognize the biases introduced
by smaller samples and less skilled researchers, and conduct the
research systematically.
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International Marketing Research
The problems faced include
Dealing with diverse markets
Finding good secondary data in foreign markets
Developing good samples
Reaching respondents
Handling differences in culture, language, and attitudes toward
marketing research
The cost of research is high, but the cost of not doing it is
higher.
International researchers follow the same steps as domestic

researchers, from defining the research problem and devel oping
a research plan to interpreting and reporting the results.
However, they often face more and different problems.
In many foreign markets, the international researcher may have
a difficult time finding good secondary data. Because of the
scarcity of good secondary data, international researchers must
collect their own primary data, and reaching respondents is not
always easy in other parts of the world.
Cultural differences from country to country cause additional
problems for international researchers. Language is the most
obvious obstacle. Consumers in different countries also vary in
their attitudes toward marketing research. Customs in some
countries may prohibit people from talking with strangers.
Although the costs and problems associated with international
research may be high, the costs of not doing it might be even
higher. Once recognized, many of the problems associated with
international marketing research can be overcome or avoided.
41
Intrusions on Consumer Privacy
Failure to address privacy issues results in
Angry, less cooperative consumers
Increased government intervention
Best approaches for researchers:
Asking only for the information needed
Using the information responsibly to provide customer value
Avoiding sharing the information without the customer’s
permission
Even though many customers feel positive about marketing
research and believe that it serves a useful purpose, there are
others who strongly resent or even mistrust marketing research.

Failure to address privacy issues could result in angry, less
cooperative consumers and increased government intervention.
As a result, the marketing research industry is considering
several options for responding to intrusion and privacy issues.
One example is the Marketing Research Association’s “Your
Opinion Counts” and “Respondent Bill of Rights” initiatives to
educate consumers about the benefits of marketing research and
distinguish research from telephone selling and database
building.
Most major companies have now appointed a chief privacy
officer (CPO), whose job is to safeguard the privacy of
consumers who do business with the company. If researchers
provide value in exchange for information, customers will
provide it. For example, Amazon.com customers do not mind if
the firm builds a database of products they buy as a way to
provide future product recommendations. The best approach is
for researchers to ask only for the information they need, use it
responsibly to provide customer value, and avoid sharing
information without the customer’s permission.
42
Intrusions on Consumer Privacy (CONT’D)
Target made some customers uneasy by using their buying
histories to figure out “private” things about them.
By studying the buying histories of women who’d previously
signed up for its baby registries, Target found that it could
develop a “pregnancy prediction” score for each customer based
on her purchasing patterns across 25 product categories. It used
this score to start sending personalized books of coupons for
baby-related items to expectant parents, keyed to their
pregnancy stages.

However, the strategy hit a snag when an angry man showed up
at his local Target store, complaining that his high school –aged
daughter was receiving Target coupons for cribs, strollers, and
maternity clothes. “Are you trying to encourage her to get
pregnant?” he demanded. The Target store manager apologized.
But when he called to apologize again a few days later, he
learned that Target’s marketers had, in fact, known about the
young woman’s pregnancy before her father did.
43
Misuse of Research Findings
Few advertisers rig their research designs or deliberately
misrepresent the findings.
Solution
s:
Development of codes of research ethics and standards of
conduct
Companies must accept responsibility to protect consumers’
best interests and their own.
Research studies can be powerful persuasion tools. But in some
cases, research surveys appear to have been designed just to
produce the intended effect. Few advertisers openly rig their
research designs or blatantly misrepresent the findings. Most

abuses are subtle stretches so as to avoid disputes over the
validity and use of research findings.
Recognizing that surveys can be abused, several associations —
including the American Marketing Association, the Marketing
Research Association, and the Council of American Survey
Research Organizations (CASRO)—have developed codes of
research ethics and standards of conduct. For example, the
CASRO Code of Standards and Ethics for Survey Research
outlines researcher responsibilities to respondents, including
confidentiality, privacy, and avoidance of harassment. Each
company must accept responsibility for policing the conduct and
reporting of its own marketing research to protect consumers’
best interests and its own.
44
TED TALK: The Human Insights Missing from Big Data
https://www.ted.com/talks/tricia_wang_the_human_insights_mis
sing_from_big_data?language=en
Your Digital Footprint Matters!
(InternetSociety.org Tutorial)

https://www.internetsociety.org/tutorials/your-digital-footprint-
matters/
LIBS 110 Module 2, Research Question Assignment
Note: Please read Chapter 2, watch the Module 2 lecture video,
and review all Module 2 materials before working on this
assignment.
Exploring Your Topic & Pre-Search
Select a topic related to information literacy from the class
Discussion Board. Only three people may start with the same
broad topic. What broad topic did you choose?
Government censorship.
Go to the Information Literacy Research Guide. Information
literacy categories are listed on the left-hand side of the page.
(Examples: Access to Information, Algorithmic Bias,…). Find
your broad topic within these pages. Select one specific
resource from the resource links provided on the topic pages in
the Information Literacy Research Guide. What is the title of
the resource that you selected?
Information ethics.
Read the resource (if it is a book, read the summaries and
chapter titles, if an article or video, read/view the whole thing).
In 3-4 sentences, what is this resource about?
The information ethics is contained with the expected behaviors

and practices that people should pottery while using the
technology. Also talks about the rights that we have as the
members of the society while we are using the technology. It as
well outlines how the ISP should be enhancing the security of
the data transmitted in their network.
Do a Google Search on your broad topic. What are at least three
specific issues or aspects dealing with this topic that you are
interested in? (PRO TIP: If you find that you are not interested
in this topic, go back to step one and pick a different topic from
the Discussion Board and start again) LIBS 110 Module 2,
Research Question Assignment
The topic is leading to an understanding how the digital security
is being compromised, loss of trust with the internet platforms
and the manner in which the personal data can be used against
you.
What types of information did you see in your Google search?
How did they help you focus your topic? (PRO TIP: If your
Google Search didn’t help you, try searching using different
keywords) (PRO TIP: If you don’t know what is meant by
“types of information,” read Chapter 2 of your book)
Well, google helped me to understand the manner in which
information is leaked and also give the statistics of how the
activity is increasing around the world.
Write down the 5 W’s for your research topic, (Who, What,
When, Where, Why) of your topic, as explained in the Library

Tutorial #1. If you need a “How,” include that as well.
“who” will include the government and all the ISP who allows
sharing of their customers data.
“what” will include what is the focus of the practice.
“when” will discuss when the information and the practice is
essential and when it is a hazard to the members of the society.
“where” I shall discuss about the point the information is
relevant and essential to be extraction and where it should not
be extracted.
“Why” will give us the reason of having the information
extracted.
“how” will explain the manner in which the information is being
extracted
How that you have done some “pre-search,” write a first draft of
your research question. (PRO TIP: If you have not read Chapter
2, viewed the lecture, or read all of the Module 2 materials, you
must do this before you can write your research question)
How To Regulate Government Censorship
LIBS 110, Module 2, Research Question Assignment Part Two
Before completing this assignment please read the feedback that
you received on Research Question Assignment Part One.
1. Describe the changes that you need to make to your research

question and why, based on the feedback from your instructor.
2. What steps did you take to apply these changes? For example,
did you look at the Information Literacy Research Guide for
ideas? Did you do a Google search? Re think the 5 Ws? Did you
ask your instructor for help? If you did not need to make any
changes, move on to the next question.
3. What is your new research question? If you did not need to
make any changes, write the same research question from the
previous assignment.

Note: Please read Chapter 2, watch the Module 2 lecture video,
and review all Module 2
materials before working on this assignment.
Exploring Your Topic & Pre-Search
1. Select a topic related to information literacy from the class
Discussion Board.
Only three people may start with the same broad topic. What
broad topic did you
choose?
2. Go to the Information Literacy Research Guide. Information
literacy categories
are listed on the left-hand side of the page. (Examples: Access
to Information,
Algorithmic Bias,…). Find your broad topic within these pages.
Select one
specific resource from the resource links provided on the topic
pages in the
Information Literacy Research Guide. What is the title of the
resource that you
selected?

3. Read the resource (if it is a book, read the summaries and
chapter titles, if an
article or video, read/view the whole thing). In 3-4 sentences,
what is this
resource about?
4. Do a Google Search on your broad topic. What are at least
three specific issues
or aspects dealing with this topic that you are interested in?
(PRO TIP: If you find
that you are not interested in this topic, go back to step one and
pick a different
topic from the Discussion Board and start again)
https://guides.lib.odu.edu/infolitresearch
5. What types of information did you see in your Google
search? How did they help
you focus your topic? (PRO TIP: If your Google Search didn’t
help you, try
searching using different keywords) (PRO TIP: If you don’t

know what is meant by
“types of information,” read Chapter 2 of your book)
6. Write down the 5 W’s for your research topic, (Who, What,
When, Where, Why)
of your topic, as explained in the Library Tutorial #1. If you
need a “How,”
include that as well.
7. How that you have done some “pre-search,” write a first draft
of your research
question. (PRO TIP: If you have not read Chapter 2, viewed the
lecture, or
read all of the Module 2 materials, you must do this before you
can write
your research question)
Formulating a Good Research Question
(Use this with the “Research Question Flowchart”)
Before you begin, watch the Module 2 Lecture video.
Here is a step-by-step guide to formulating a good research
question for LIBS 110.:
1) Identify a topic that interests you
2) Brainstorm ways to relate it to Information Literacy

3) Pick a population it affects
4) Identify a measurable impact or time span
5) Be sure to avoid biased / yes or no questions / list answers
(examples below)
My Example (you may NOT use this example):
1) TOPIC OF INTEREST: Animal dissections in high school
Biology classes
2) INFORMATION LITERACY: Virtual programs, online
resources, dissection simulations
3) POPULATION: High school Biology students or classes
4) MEASUREABLE IMPACT: Science assessment scores
General Templates. Just plug in your categories!
A. (Effect) How does (TOPIC/INFORMATION LITERACY)
affect the (MEASUREABLE IMPACT) of (POPULATION)?
Example: How does the use of dissection simulation programs
affect the assessment scores of high school biology students?
B. (Comparison) How does (MEASUREABLE IMPACT*) of
(POPULATION*) relate when (COMPARISON 1*) compares to
(COMPARISON 2*)? *one component must be tied to
Information Literacy
Example: How do the science assessment scores of high school
Biology students using dissection simulations* compare to those
conducting actual dissection?

C. (Historical) How has (TOPIC/INFORMATION LITERACY)
affected/changed (POPULATION) over (TIME SPAN) years?
Example: How has virtual dissection simulation changed the
landscape of high school biology classes over the last 20 years?
Avoid these pit-falls:
TOO BROAD: How does technology influence high school
biology students?
TOO NARROW: How has the development of virtual dissection
affected the fetal pig sales over the past 10 years?
YES/NO: Are there online alternatives to animal dissection?
LIST: What are the alternatives to animal dissections?
BIASED: How can teachers end the cruel practice of dissecting
animals?
LIBS 110 Research Question Flowchart
*Before you begin: watch the Module 2 Lecture Video and
complete all other Module 2 assignments
Pick a topic you like from the Information Literacy Research
Guide – you’ll be researching this same topic for the rest

of the semester!
Is it an information literacy topic?
YES NO -> Do not move ahead until you connect it to
Information Literacy
Is it a Social Sciences Research Question or a Humanities
Research Question? (this is addressed in the lecture) Your
research question can be either one! Go to the section below
that best matches your topic.
If Social Sciences:
Does it have a specific population (like males, females, or a
particular age group) or a specific location (like a country or
type of area- rural, urban, suburban, school, university, etc)?
YES NO -> Pick a specific population or a location to
research.

Is the impact measurable? (Test scores, percentages, depression
rates, change over time, comparative statistics, etc.)
YES NO -> Identify the ways your research question could be
measured.
Check your research question with the components provided in
“Formulating a Good Research Question.” If you have
met the requirements, move on to completing the Research
Question Assignment. If you have additional questions,
contact your Instructor.
OR, If Humanities:
Are you researching historical aspects of a topic? If so, what is
the time period? Does it take place in a particular
location? Impact a particular population group?
Are you researching a specific experience or perception of a

current population group? If so, think about the phenomena
(for example, the experience of reading news on Twitter) and
how a group of people may experience that.
Need ideas? Check out the last slide in the Module 2 video
lecture!
https://guides.lib.odu.edu/infolitresearch
Chapter 3 -Analyzing the Marketing Environment
First Stop: Microsoft: Adapting to the Fast-Changing Marketing
Environment
Microsoft dominated the computer software world throughout
the 1990s and much of the 2000s but struggled in the fast
changing technology environment.
Microsoft has a new mission with a different focus.
“to empower every person and every organization on the planet

to achieve more.”
Microsoft, the technology giant dominated the computer
software world throughout the 1990s and much of the 2000s. Its
Windows and Office products have long been must-haves in the
PC market. But with the decline in stand-alone personal
computers and the surge in digitally connected devices—
everything from smartphones and tablets to internet-connected
TVs—mighty Microsoft found itself struggling to find its place
in a fast-changing environment. However, the tech giant has
now reinvented itself as a relevant brand that consumers can’t
live without in the post-PC era.
The new mission focuses not on devices and services but on
outcomes. Rather than chasing competitors in mobile devices
and operating systems, Microsoft now intends to lead them in
productivity tools.
2
Marketing Environment
Outside forces that affect marketing management’s ability to
build and maintain successful relationships with target
customers
Microenvironment: Actors close to the company that affect its

ability to serve its customers
Macroenvironment: Larger societal forces that affect the
microenvironment
Marketing environment refers to the actors and forces outside
marketing that affect marketing management’s ability to build
and maintain successful relationships with target customers.
The marketing environment consists of a microenvironment and
a macroenvironment.
The microenvironment consists of the actors close to the
company that affect its ability to serve its customers.
The macroenvironment consists of the larger societal forces that
affect the microenvironment.
3
The marketing environment
MACROENVIRONMENT
MICROENVIRONMENT
Actors in the Microenvironment

This figure shows the major actors in the marketer’s
microenvironment.
Each of these actors are discussed in greater detail in the
following slides.
5
The Company
Interrelated groups in a company form the internal environment
Departments share the responsibility for understanding customer
needs and creating customer value.
In designing marketing plans, marketing management takes
other company groups into account—groups such as top
management, finance, research and development (R&D),
purchasing, operations, human resources, and accounting. All of
these interrelated groups form the internal environment.
With marketing taking the lead, all departments —from
manufacturing and finance to legal and human resources—share
the responsibility for understanding customer needs and

creating customer value.
6
Suppliers
Provide the resources needed by the company to produce its
goods and services
Supplier problems seriously affect marketing
Supply shortages or delays
Labor strikes
Price trends of key inputs
Suppliers form an important link in the company’s overall
customer value delivery network. They provide the resources
needed by the company to produce its goods and services.
Supplier problems can seriously affect marketing. Marketing
managers must watch supply availability and costs. Supply
shortages or delays can cost sales in the short run and damage
customer satisfaction in the long run. Rising supply costs may
force price increases that can harm the company’s sales volume.
7
Suppliers (CONT’D)
Home furnishings retailer IKEA knows the importance of

building close relationships with its extensive network of
suppliers.
“To us, our suppliers and service providers are some of our
most important partners for development. Together we grow and
expand our businesses, and explore new ways to do it in a
socially and environmentally responsible way. We share the
responsibility to make sure that the unique IKEA range is
produced at the right time, right volume,
right quality, and at a low cost to an ever-expanding customer
base. Thanks to our ambitious growth plans, we are always on
the look-out for new partners that share our values and our
ambitions to become people and planet positive.”
IKEA Supplier Statement, 2021
IKEA’s mission is to create a better everyday life for customers
by offering trendy but simple and practical home furnishings at
prices so low that as many people as possible can afford them.
But before it can sell the billions of dollars’ worth of products
its customers covet, IKEA must first develop a robust and
reliable network of supplier–partners who can help it design and
make all those products.
8

Marketing Intermediaries
Marketing intermediaries help the company to promote, sell,
and distribute its products to final buyers.
Resellers (aka wholesalers and retailers)
Physical distribution firms
Marketing services agencies
Financial intermediaries
Resellers are distribution channel firms that help the company
find customers or make sales to them. These include
wholesalers and retailers.
Physical distribution firms help the company stock and move
goods from their points of origin to their destinations.
Marketing services agencies are the marketing research firms,
advertising agencies, media firms, and marketing consulting
firms that help the company target and promote its products to
the right markets.
Financial intermediaries include banks, credit companies,
insurance companies, and other businesses that help finance
transactions or insure against the risks associated with the
buying and selling of goods.

9
Marketing Intermediaries (CONT’D)
Coca-Cola provides its retail partners with much more than just
soft drinks. It also pledges powerful marketing support.
10
Competitors
Direct and indirect competition
Marketers must gain strategic advantage by positioning products
strongly against competitors.
No single strategy is best for all companies.ProductDirect
CompetitionIndirect CompetitionDelta ShuttleKindle
ReaderWorld Cup SoccerHeineken Beer
The marketing concept states that, to be successful, a company
must provide greater customer value and satisfaction than its
competitors do. Thus, marketers must do more than simply
adapt to the needs of target consumers. They also must gain
strategic advantage by positioning their offerings strongly

against competitors’ offerings in the minds of consumers.
No single competitive marketing strategy is best for all
companies. Each firm should consider its own size and industry
position compared with those of its competitors. Large firms
with dominant positions in an industry can use certain strategies
that smaller firms cannot afford. However, small firms can also
develop winning strategies.
11
Publics
Publics: any group that has an actual or potential interest in or
impact on an organization’s ability to achieve its objectives
Financial
Media
Government
Citizen action
Local
General
Internal
Financial publics influence the company’s ability to obtain
funds.

Media publics carry news, features, and editorial opinions.
Government publics: Management must take government
developments into account.
Citizen-action publics: A company’s marketing decisions may
be questioned by consumer organizations, environmental
groups, etc.
Local publics include neighborhood residents and community
organizations.
General public: The general public’s image of the company
affects its buying.
Internal publics include workers, managers, volunteers, and the
board of directors.
12
Customers
Five types of customer markets
Consumer markets
individuals and households that buy goods and services for
personal consumption.
Business markets

buy goods and services for further processing or for use in their
production process.
Reseller market
buy goods and services to resell at a profit.
Consumer markets consist of individuals and households that
buy goods and services for personal consumption.
Business markets buy goods and services for further processing
or use in their production process.
Reseller markets buy goods and services to resell at a profit.
Government markets consist of government agencies that buy
goods and services to produce public services.
International markets consist of buyers in other countries,
including consumers, producers, resellers, and governments.
13
Customers
Five types of customer markets (cont’d)
Government markets
government agencies that buy goods and services to produce

public services.
International markets
buyers in other countries, including consumers, producers,
resellers, and governments
Consumer markets consist of individuals and households that
buy goods and services for personal consumption.
Business markets buy goods and services for further processing
or use in their production process.
Reseller markets buy goods and services to resell at a profit.
Government markets consist of government agencies that buy
goods and services to produce public services.
International markets consist of buyers in other countries,
including consumers, producers, resellers, and governments.
14
Major Forces in the Company’s Macroenvironment

This figure shows the six major forces in the company’s
macroenvironment.
Each of these forces are discussed in greater detail in the
following slides.
15
Demographic Environment
Demography is the study of human populations in terms of size,
density, location, age, gender, race, occupation, and other
statistics.
Marketers analyze:
Changing age and family structures
Geographic population shifts
Educational characteristics
Population diversity
Demography is the study of human populations in terms of size,
density, location, age, gender, race, occupation, and other
statistics. Marketers analyze several important factors that
affect the marketing environment.
The first factor is the changing age and family structures. The
U.S. population contains several generational groups. These

include the Baby Boomers, Generation X, Generation Y or
Millennials, and Generation Z. These are discussed in more
detail on the next slide.
The second factor is the changing American household. More
people are divorcing or separating, choosing not to marry,
marrying later, or marrying without intending to have children.
Marketers must increasingly consider the special needs of
nontraditional households because they are now growing more
rapidly than traditional households. Each group has distinctive
needs and buying habits.
The third factor is geographic shifts in population. Population
shifts interest marketers because people in different regions buy
differently. For example, people in the Midwest buy more
winter clothing than people in the Southeast.
And the final factor is increasing diversity. Marketers face
increasingly diverse markets as their operations become more
international in scope. Some major companies also explicitly
target gay and lesbian consumers.
16
Demographic Environment (CONT’D)
The U.S. population contains several generational groups:

Baby Boomers: 1946-1964
Generation X: 1965-1976
Millennials (or Generation Y): 1977-2000
Generation Z: after 2000
The U.S. population contains several generational groups. These
include the Baby Boomers, Generation X, Generation Y or
Millennials, and Generation Z.
Baby boomers: The 78 million people born during the years
following World War II and lasting until 1964.
Generation X: The 49 million people born between 1965 and
1976 in the “birth dearth” following the baby boom.
Millennials (or Generation Y): The 83 million children of the
baby boomers born between 1977 and 2000.
Generation Z: People born after 2000 (although many analysts
include people born after 1995) who make up the kids, tweens,
and teens markets
17

February 12, 2021
Demographic Environment (CONT’D)
Targeting Gen Xers:
Lowe’s markets heavily to Gen X homeowners with ideas and
advice on home-improvement projects and problems, urging
them to “Never Stop Improving.”
With so much potential, many brands and organizations focus
on Gen Xers as a prime target segment. For example, a full 82
percent of Gen Xers own their own homes, making them an
important segment for home-and-hearth marketers. Home-
improvement retailer Lowe’s markets heavily to Gen X
homeowners, urging them to “Never Stop Improving.” Through
ads, online videos, and a substantial social media presence,
Lowe’s provides ideas and advice on a wide range of indoor and
outdoor home-improvement projects and problems, providing
solutions that make life simpler for busy Gen X homeowners
and their families.
19
Economic Environment

Economic factors affect consumer purchasing power and
spending
Changes in consumer spending
Differences in income distribution
The economic environment consists of economic factors that
affect consumer purchasing power and spending patterns.
Economic factors can have a dramatic effect on consumer
spending and buying behavior. Consumers have now adopted a
back-to-basics sensibility in their lifestyles and spending
patterns that will likely persist for years to come. They are
buying less and looking for greater value in the things they do
buy. In turn, value marketing has become the watchword for
many marketers. Marketers in all industries are looking for
ways to offer today’s frugal buyers greater value.
Marketers should pay attention to income distribution as well as
income levels. Over the past several decades, the rich have
grown richer, the middle class has shrunk, and the poor have
remained poor. This distribution of income has created a tiered
market. Many companies aggressively target the affluent, while
other firms target those with more modest means. Still other
companies tailor their marketing offers across a range of

markets, from the affluent to the less affluent.
20
Economic environment: UNPRECEDENTED impact of Covid-
19 pandemic
Economy comes to a full stop in March 2020, in an effort to
slow the spread of the coronavirus
“Wallet” recession: consumers hang onto their savings, or eat
through them
Driven by 17% unemployment and 40 million American jobs
either furloughed or disappeared
Not the same level of demand that drives upward of 2/3 of the
U.S. economy (lag effect)
Unprecedented $2 trillion stimulus plan approved to bolster the
US economy
Included relief for small business loans, expanded
unemployment benefits, and direct payments to households:
uneven dispersion throughout the economy
Additional $1.4 trillion stimulus plan currently under
consideration, for consumers
Source: “How the Impact of COVID-19 Is Changing
Marketing”, Target Marketing, 6.22.20
Economic environment: UNPRECEDENTED impact of Covid-

19 pandemic (CONT’D)
Densely populated urban centers may look and feel different for
some time
Impact on these innovation centers that accelerate the economy
may damper national and global growth
Strong growth in housing demand and prices in smaller
metropolitan markets
Recessionary, savings-conscious mindset prevails
Consumers focused on more pricing benefits from brand loyalty,
and less VIP experiences
Source: “How the Impact of COVID-19 Is Changing
Marketing”, Target Marketing, 6.22.20
Source: “COVID-19 and the Great Reset”, McKinsey & Co.,
9.10.20
Source: “COVID-19 and the Great Reset”, McKinsey & Co.,
9.10.20
Natural Environment

Physical environment and natural resources needed as inputs by
marketers or affected by marketing activities
Environmental sustainability concerns have grown steadily over
the past three decades.
Trends:
Shortages of raw materials
Increased pollution
Increased government intervention
The natural environment involves the physical environment and
the natural resources that are needed as inputs by marketers or
that are affected by marketing activities. Marketers should be
aware of several trends in the natural environment.
The first involves growing shortages of raw materials. Firms
making products that require scarce resources face large cost
increases, even if the materials remain available. The second
trend is increased pollution. The third trend is increased
government intervention in natural resource management. The
governments of different countries vary in their concern and
efforts to promote a clean environment.
Today, enlightened companies adopt practices that support
environmental sustainability. This refers to the effort to create a

world economy that the planet can support indefinitely.
25
Technological Environment
New technologies create new markets and opportunities.
Digital Technology
Radio-frequency identification (RFID) is technology to track
products through various points in the distribution channel.
Government agencies investigate and ban potentially unsafe
products.
New technologies can offer exciting opportunities for
marketers. Many firms use radio-frequency identification, or
RFID, technology to track products through various points in
the distribution channel. New technologies create new markets
and opportunities. Companies that do not keep up will soon find
their products outdated.
Government agencies investigate and ban potentially unsafe
products. Regulations have resulted in much higher research
costs and longer times between new product ideas and their
introduction. Marketers should be aware of these regulations
when applying new technologies and developing new products.
26

Technological Environment (CONT’D)
Disney is taking RFID technology to new levels with its cool
new MagicBand RFID wristband.
Wearing a MagicBand at The Walt Disney World Resort opens
up a whole new level of Disney’s famed magic. After
registering for cloud-based MyMagic+ services, with the flick
of your wrist you can enter a park or attraction, buy dinner or
souvenirs, or even unlock your hotel room.
27
Political Environment
Forces that influence or limit various organizations and
individuals in a society
Laws, government agencies, and pressure groups
The political environment refers to laws, government agencies,
and pressure groups that influence or limit various
organizations and individuals in a given society.
28

Major U.S. Legislation Affecting Marketing
Legislation regulating business is intended to protect
companies from each other
consumers from unfair business practices
the interests of society against unrestrained business behavior
Business legislation has been enacted for a number of reasons.
The first is to protect companies from each other. The second
purpose of government regulation is to protect consumers from
unfair business practices. The third purpose is to protect the
interests of society against unrestrained business behavior
29
Major U.S. Legislation Affecting Marketing: 1990–2010
LegislationPurposeChildren’s Television Act (1990)Limits the
number of commercials aired during children’s
programsNutrition Labeling and Education Act (1990)Requires
that food product labels provide detailed nutritional
informationTelephone Consumer Protection Act
(1991)Establishes procedures to avoid unwanted telephone
solicitationsAmericans with Disabilities Act (1991)Makes
discrimination against people with disabilities illegal

This table lists legislation enacted from 1990 – 2010 that affects
marketing.
A complete list of laws, starting with the Sherman Antitrust Act
of 1890, can be found in Table 3.1 of this chapter.
30
Major U.S. Legislation Affecting Marketing: 1990–2010
(CONT’D)LegislationPurposeChildren’s Online Privacy
Protection Act (2000)Prohibits online collection of information
from children without parental consent
Allows parents to review information collected from their
childrenDo-Not-Call Implementation Act (2003)Collects fees
from telemarketers for the enforcement of a Do-Not-Call
RegistryCAN-SPAM Act (2003)Regulates the distribution and
content of unsolicited commercial e-mailFinancial Reform Law
(2010)Created the Bureau of Consumer Financial Protection:
Writes and enforces rules for the marketing of financial
products to consumers
This table lists legislation enacted from 1990 – 2010 that affects
marketing.

A complete list of laws, starting with the Sherman Antitrust Act
of 1890, can be found in Table 3.1 of this chapter.
31
Socially Responsible Behavior
Socially responsible companies actively seek out ways to
protect the long-run interests of consumers and the
environment.
Companies develop policies, guidelines, and other responses to
complex social responsibility issues.
Socially responsible firms actively seek out ways to protect the
long-run interests of their consumers and the environment.
Almost every aspect of marketing involves ethics and social
responsibility issues. Companies are now developing policies,
guidelines, and other responses to complex social responsibility
issues.
Enlightened companies encourage their managers to look
beyond what the regulatory system allows and simply “do the
right thing.”
32

Cause-Related Marketing
Companies use cause-related marketing to
Exercise their social responsibility
Build more positive images
Primary form of corporate giving
Controversy—strategy for selling more rather than a strategy
for giving
To exercise their social responsibility and build more positive
images, many companies are now linking themselves to
worthwhile causes. Cause-related marketing has become a
primary form of corporate giving.
Critics worry that cause-related marketing is more a strategy for
selling than a strategy for giving. Thus, companies using cause-
related marketing might find themselves walking a fine line
between increased sales and an improved image and charges of
exploitation.
33
Cause-Related Marketing (CONT’D)
Ben & Jerry’s three-part “linked prosperity” mission drives it to
make fantastic ice cream.
Economic Mission: manage our Company for sustainable

financial growth.
Social Mission: use our Company in innovative ways to make
the world a better place
Product Mission: make fantastic ice cream – for its own sake
Under its three-part mission, Ben & Jerry’s wants to make
fantastic ice cream (product mission), manage the company for
sustainable financial growth (economic mission), and use the
company “in innovative ways to make the world a better place”
(social mission). Ben & Jerry’s backs its mission with actions.
34
Caramel Non-Dairy Frozen Dessert With Fudge Chips, Graham
Cracker Swirls & Chocolate Cookie Swirls
Colin Kaepernick is serving up sweet justice with the non-
dairiest compilation of cookies & caramel. This flavor honors
Colin’s activism in pursuit of racial justice & his portion of the
proceeds from Change the Whirled™ go to Know Your Rights
Camp. Learn more at Know Your Rights Camp
Cultural Environment

Institutions and other forces that affect a society’s basic values,
perceptions, and behaviors
Persistence of cultural values
Core beliefs and values have a high degree of persistence.
Secondary beliefs and values are more open to change.
The cultural environment consists of institutions and other
forces that affect a society’s basic values, perceptions,
preferences, and behaviors. Society shapes basic beliefs and
values. People grow up in a particular society that shapes their
basic beliefs and values. They absorb a worldview that defines
their relationships with others. Cultural characteristics can
affect marketing decision making.
People in a given society hold many beliefs and values. Their
core beliefs and values have a high degree of persistence and
are passed on from parents to children and are reinforced by
schools, churches, businesses, and government. For example,
most Americans believe in individual freedom, hard work,
getting married, achievement, and success. These beliefs shape
more specific attitudes and behaviors found in everyday life.
Secondary beliefs and values are more open to change and
include people’s views of themselves, others, organizations,

society, nature, and the universe. Believing in marriage is a core
belief; believing that people should get married early in life is a
secondary belief. Marketers have some chance of changing
secondary values but little chance of changing core values.
36
Cultural Environment (CONT’D)
Shifts in secondary cultural values of people’s views about
Themselves
Others
Organizations
Society
Nature
Universe
Cultural characteristics that can affect marketing decision
making are the persistence of cultural values and shifts in
secondary cultural values, such as people’s views of
themselves, others, organizations, society, and nature.
People’s views of themselves: People vary in their emphasis on
serving themselves versus serving others.
People’s views of others: More “cocooning” – staying home,
eating home-cooked meals

People’s views of organizations: Decline of loyalty toward
companies
People’s views of society: Patriots defend it, reformers want to
change it, and malcontents want to leave it.
People’s views of nature: Some feel ruled by it, in harmony
with it, or seek to master it.
People’s views of the universe: Renewed interest in spirituality
and development of more permanent values—family,
community, earth, faith
37
Cultural Environment (CONT’D)
Riding the natural and organic foods trend, Annie’s is out to
create a happier and healthier world with nourishing products
that are “forever kind to the planet.”
Annie’s is out to create a happier and healthier world with
nourishing foods and responsible conduct that is “forever kind
to the planet.” Annie’s products are made from simple, natural
ingredients grown by its farm partners. The products contain
“no artificial anything,” says the company. “If it’s not real, it’s
not Annie’s.” The company works closely with its food-supply-
system

partners to jointly raise the bar for sustainability and organics.
Annie’s also makes sustainable practices a top priority with its
packaging—more than 90 percent of Annie’s packaging by
weight is recyclable.
38
CULTURAL ENVIRONMENT – SOCIAL JUSTICE, 2020
https://youtu.be/drcO2V2m7lw
https://youtu.be/pcSP1r9eCWw
CULTURAL ENVIRONMENT – SOCIAL JUSTICE, 2021
TrainersForHire.com
Responding to the Marketing Environment
Reactive firms passively accept the marketing environment and
do not try to change it.
Proactive firms develop strategies to change the environment.
They take aggressive actions to affect the publics and forces in
their marketing environment.

Many companies view the marketing environment as an
uncontrollable element to which they must react and adapt.
They passively accept the marketing environment and do not try
to change it.
Other companies take a proactive stance toward the marketing
environment. Rather than assuming that strategic options are
bounded by the current environment, these firms develop
strategies to change the environment. These firms take
aggressive actions to affect the publics and forces in their
marketing environment.
Marketing management cannot always control environmental
forces. In many cases, it must settle for simply watching and
reacting to the environment. For example, a company would
have little success trying to influence geographic population
shifts, the economic environment, or major cultural values. But
whenever possible, smart marketing managers take a proactive
rather than reactive approach to the marketing environment.
41
PROCTER & GAMBLE, RESPONDING TO THE 2020
MARKETING ENVIRONMENT
Multimillion dollar push to address racial equality that also

includes sponsoring two films from the Queen Collective on
BET and a Time 100 Talks virtual event
P&G also set four benchmarks for itself:
Achieving 40% multicultural representation in the U.S.;
Accelerating its investments in Black-owned and -operated
media companies, agencies and marketing suppliers;
Enacting reviews to ensure Black people — and all people —
are represented fairly in its marketing and advertising;
Taking steps, including withholding budgets, to ensure its
advertising doesn't appear near hateful or discriminatory
content.
Source: “9 pivotal campaigns that show how marketing
transformed in H1”, MarketingDive.com, 7.13.20
https://youtu.be/U7bnS8R994I
Ted talk: the covid-19 crisis is a chance to do capitalism
differently
https://www.ted.com/talks/mariana_mazzucato_the_covid_19_cr
isis_is_a_chance_to_do_capitalism_differently

Chapter 5-UNDERSTANDING CONSUMER AND BUSINESS
BUYER BEHAVIOR
Shinola: Nobody’s Confusing Sh*t with Shinola Anymore
“Built in Detroit”: Shinola is selling gritty Detroit,
authentically American values, emotions, and a roll-up-our-
sleeves lifestyle.
Premium watches, high-end bicycles, apparel, leather
accessories, and audio equipment
$125 million in sales
1,000 stores worldwide, including high-end department stores
such as Nordstrom, Neiman Marcus, and Saks Fifth Avenue
“We’re starting with the reinvigoration of a storied American
brand, and a storied American city,” says the company. Shinola
“is a brand committed to turning out high-quality products in
America with…American suppliers and American labor.”
Shinola is selling much more than just watches or bikes or
leather accessories. It’s selling gritty Detroit, authentically

American values, emotions, and a roll-up-our-sleeves lifestyle,
things that lie at the heart consumers’ feelings and behavior
toward the brand.
2
Consumer Buyer Behavior and Consumer Markets
Consumer buyer behavior
Buying behavior of final consumers
Consumer market
All the individuals and households that buy or acquire goods
and services for personal consumption
Consumer buyer behavior refers to the buying behavior of final
consumers who are the individuals and households that buy
goods and services for personal consumption. All of these final
consumers combine to make up the consumer market.
3
The Model of Buyer Behavior
This figure shows that marketing and other stimuli enter the
consumer’s “black box” and produce certain responses.

Marketers must figure out what is in the buyer’s black box. The
whats, wheres, and whens of consumer buying behavior can be
measured. But it’s very difficult to figure out the whys of
buying behavior (that’s why it’s called the black box).
Marketers spend a lot of time and money trying to figure out
what makes customers tick.
4
Factors Influencing Consumer Behavior
Consumer purchases are influenced strongly by cultural, social,
personal, and psychological characteristics, as shown in this
figure. For the most part, marketers cannot control such factors,
but they must take them into account. The following slides will
discuss these characteristics in more detail.
5
Cultural Factors
Culture
Set of basic values, perceptions, wants, and behaviors learned
by an individual from family and other important institutions
Subculture
Group of people with shared value systems based on common

life experiences and situations
Total market strategy integrates ethnic themes and cross-
cultural perspectives within a brand’s mainstream marketing.
Social class
Relatively permanent and ordered divisions in a society whose
members share similar values, interests, and behaviors
Culture is the most basic cause of a person’s wants and
behavior. Culture is the set of basic values, perceptions, wants,
and behaviors learned by a member of society from family and
other important institutions.
A subculture is a group of people with shared value systems
based on common life experiences and situations.
A total market strategy integrates ethnic themes and cross-
cultural perspectives within a brand’s mainstream marketing,
appealing to consumer similarities across subcultures rather
than differences.
A social class is the relatively permanent and ordered divisions
in a society whose members share similar values, interests, and
behaviors. It is measured as a combination of occupation,
income, education, wealth, and other variables.

6
TikTok SUBCULTURES 2021
Dark Academia - Like a high fashion version of Harry Potter,
revolves around the literary classics, beautiful libraries, plenty
of starched collars, tweed jackets, and perfectly worn-in
leathers.
Scene Kids - the early Aughts are back. Recreation of old
MySpace photos from the original scene kid era, big hair and
all. Think of the scene kid as a cross between a punk and raver.
Grunge -Patchwork sweaters, ripped jeans, and grown-out roots,
with unexpected touches like pearls and a more Goth approach
to makeup.
DARK ACADEMIA
SCENE KIDS
GRUNGE
Social Factors
Groups
Word-of-mouth (WOM) influence
Opinion leaders

Online social networks
Family
Roles and status
A consumer’s behavior is also influenced by social factors.
Groups that have a direct influence and to which a person
belongs are called membership groups. Reference groups serve
as direct or indirect points of comparison or reference in
forming a person’s attitudes or behavior. An aspirational group
is one to which the individual wishes to belong.
Word-of-mouth influence refers to the impact of the personal
words and recommendations of trusted friends, associates, and
other consumers on buying behavior. Rather than leaving it to
chance, marketers can help to create positive conversations
about their brands.
An opinion leader is a person within a reference group who,
because of special skills, knowledge, personality, or other
characteristics, exerts social influence on others. Opinion
leaders are also referred to as influentials or leading adopters.
Buzz marketing involves enlisting or even creating opinion

leaders to serve as brand ambassadors who spread the word
about a company’s products.
Online social networks are online communities where people
socialize or exchange information and opinions.
Family members can strongly influence buyer behavior.
Marketers are interested in the roles and influence of the
husband, wife, and children on the purchase of different
products and services.
A person’s position in each group can be defined in terms of
both role and status. People usually choose products appropriate
to their roles and status.
8
Personal Factors
Occupation
Age and family life-cycle
Economic situation
Lifestyle
Personality and self-concept
A buyer’s decisions also are influenced by personal

characteristics of the buyer. A person’s occupation affects the
goods and services bought. Marketers try to identify the
occupational groups that have an above-average interest in their
products and services. A company can specialize in making
products needed by a given occupational group.
Tastes in food, clothes, furniture, and recreation are often age
related. Buying is also shaped by the stage of the family life
cycle. One of the leading life-stage segmentation systems is the
Nielsen PRIZM Lifestage Groups system. PRIZM classifies
every American household into one of 66 distinct life-stage
segments, which are organized into 11 major life-stage groups.
A person’s economic situation will affect his or her store and
product choices. Marketers watch trends in spending, personal
income, savings, and interest rates.
Lifestyle is a person’s pattern of living as expressed in his or
her psychographics. It involves measuring consumers’ major
AIO dimensions - activities, interests, and opinions. The
lifestyle concept can help marketers understand changing
consumer values and how they affect buyer behavior.
Personality refers to the unique psychological characteristics
that distinguish a person or group. It can be useful in analyzing

consumer behavior for certain product or brand choices. A
person’s self-concept is also made use of by marketers. The idea
is that people’s possessions contribute to and reflect their
identities.
9
Personal Factors (CONT’D)
MINI owners—who times call themselves “MINIacs”—have a
strong and emotional connection with their cars.
Brand personality: MINI markets to personality segments of
people who are “adventurous, individualistic, open-minded,
creative, tech-savvy, and young at heart”—anything but
“normal”—just like the car.
10
SIXTEEN COVID-19 PERSONALITY TYPESPERSONALITY
TYPEDESCRIPTION1. DeniersDownplay the viral threat,
promoting business as usual2. SpreadersWant the virus to
spread, herd immunity to develop, and normality to return3.
HarmersTry to harm others, e.g. by spitting or coughing at
them4. RealistsRecognize the reality of the potential harm and
adjust their behaviors5. WorriersStay informed and safe to

manage their uncertainty and fear6. ContemplatorsIsolate and
reflect on life and the world7. HoardersPanic-buy and hoard
products to quell their insecurity8. InvinciblesOften young, who
believe themselves to be immune
Source: “Research Says There Are 16 Covid-19 Personality
Types. Leaders Have to Plan for Them All”, Inc., 2.12.21
SIXTEEN COVID-19 PERSONALITY TYPES
(CONT’D)PERSONALITY TYPEDESCRIPTION9.
RebelsDefiantly ignore social rules restricting their individual
freedoms10. BlamersVent their fears and frustrations onto
others11. ExploitersExploit the situation for power, profit or
brutality12. InnovatorsDesign or re-purpose resources to fight
the pandemic13. SupportersShow their solidarity in support of
others14. AltruistsHelp the vulnerable, elderly, and isolated15.
WarriorsLike the front-line health care workers, combat its grim
reality16. VeteransExperienced SARS or MERS and willingly
comply with restrictions
Source: “Research Says There Are 16 Covid-19 Personality
Types. Leaders Have to Plan for Them All”, Inc., 2.12.21
Psychological Factors
Motivation

Perception
Learning
Beliefs and Attitudes
A motive (or drive) is a need that is sufficiently pressing to
direct a person to seek satisfaction. Many companies employ
teams of psychologists, anthropologists, and other social
scientists to carry out motivation research.
Perception is the process by which people select, organize, and
interpret information to form a meaningful picture of the world.
Selective distortion describes the tendency of people to
interpret information in a way that will support what they
already believe. Selective retention means that consumers are
likely to remember good points made about a brand they favor
and forget good points made about competing brands. Some
consumers worry that they will be affected by marketing
messages without even knowing it—through subliminal
advertising.
Learning describes changes in an individual’s behavior arising
from experience. The practical significance of learning theory
for marketers is that they can build up demand for a product by
associating it with strong drives by using motivating cues and
providing positive reinforcement.
A belief is a descriptive thought that a person holds about

something. Marketers are interested in the beliefs that people
formulate about specific products and services because these
beliefs make up product and brand images that affect buying
behavior. Attitudes put people into a frame of mind of liking or
disliking things, of moving toward or away from them.
13
Maslow’s Hierarchy of Needs
Abraham Maslow sought to explain why people are driven by
particular needs at particular times. Why does one person spend
a lot of time and energy on personal safety and another on
gaining the esteem of others? Maslow’s answer is that human
needs are arranged in a hierarchy, from the most pressing at the
bottom to the least pressing at the top. They include
physiological needs, safety needs, social needs, esteem needs,
and self-actualization needs.
14
Buyer Decision Process

This figure shows that the buyer decision process consists of
five stages.
The first stage is need recognition. The need can be triggered by
internal stimuli when one of the person’s normal needs rises to
a level high enough to become a drive. A need can also be
triggered by external stimuli.
The second stage is information search. Consumers can obtain
information from several sources like personal, commercial,
public, and experiential sources.
The third stage is the evaluation of alternatives, that is, how
consumers process information to choose among alternative
brands.
The fourth stage is the purchase decision. Two factors can come
between the purchase intention and the purchase decision: the
attitudes of others and unexpected situational factors.
The last stage is postpurchase behavior. Determining if the
consumer is satisfied or dissatisfied with the purchase lies in
the relationship between the consumer’s expectations and the
product’s perceived performance. However, all major purchases
result in cognitive dissonance, or discomfort caused by
postpurchase conflict.
15
Postpurchase Behavior
Postpurchase customer satisfaction is a key to building

profitable customer relationships.
Postpurchase customer satisfaction is a key to building
profitable customer relationships. Most marketers go beyond
merely meeting the customer expectations —they aim to delight
customers.
16
Stages in the Adoption Process
Awareness
Interest
Evaluation
Trial
Adoption
The adoption process is the mental process through which an
individual passes from first learning about an innovation to
final adoption. Consumers go through five stages in the process
of adopting a new product, which is a good, service, or idea that
is perceived by some potential customers as new.
The first stage is awareness. In this stage the consumer becomes

aware of the new product but lacks information about it.
The second stage is interest, which involves the consumer
seeking information about the new product.
The third stage is evaluation, where the consumer considers
whether trying the new product makes sense.
The fourth stage is trial. In this stage, the consumer tries the
new product on a small scale to improve his or her estimate of
its value.
The final stage is adoption where the consumer decides to make
full and regular use of the new product.
17
Adopter Categories Based on Relative Time of Adoption of
Innovations
People can be classified into the adopter categories shown in
Figure 5.5. The curve illustrates that after a slow start, an
increasing number of people adopt the new product.
The five adopter groups have differing values. Innovators try
new ideas at some risk. Early adopters are opinion leaders in
their communities and adopt new ideas early but carefully.
Early mainstream adopters adopt new ideas before the average

person. Late mainstream adopters adopt an innovation only after
a majority of people have tried it. Finally, lagging adopters
adopt the innovation only when it has become something of a
tradition itself.
18
Characteristics Influencing an Innovation’s Rate of Adoption
Relative advantage
the degree to which the innovation appears superior to existing
products.
Compatibility
the degree to which the innovation fits the values and
experiences of potential consumers.
The characteristics of the new product affect its rate of
adoption.
Relative advantage is the degree to which the innovation
appears superior to existing products.
The second characteristic is compatibility, which is the degree
to which the innovation fits the values and experiences of
potential consumers.
The third characteristic is complexity, which refers to the

degree to which the innovation is difficult to understand or use.
The fourth characteristic is divisibility, which is the degree to
which the innovation may be tried on a limited basis.
The fifth characteristic is communicability. This refers to the
degree to which the results of using the innovation can be
observed or described to others.
Other characteristics that influence the rate of adoption include
initial and ongoing costs, risk and uncertainty, and social
approval.
19
Characteristics Influencing an Innovation’s Rate of Adoption
(CONT’D)
Complexity
the degree to which the innovation is difficult to understand or
use.
Divisibility
the degree to which the innovation may be tried on a limited
basis.
Communicability
the degree to which the results of using the innovation can be

The characteristics of the new product affect its rate of
adoption.
Relative advantage is the degree to which the innovation
appears superior to existing products.
The second characteristic is compatibility, which is the degree
to which the innovation fits the values and experiences of
potential consumers.
The third characteristic is complexity, which refers to the
degree to which the innovation is difficult to understand or use.
The fourth characteristic is divisibility, which is the degree to
which the innovation may be tried on a limited basis.
The fifth characteristic is communicability. This refers to the
degree to which the results of using the innovation can be
Other characteristics that influence the rate of adoption include
initial and ongoing costs, risk and uncertainty, and social
approval.
20
Business Buyer Behavior
Business buyer behavior
Purchasing goods and services are used in the production of
other products and services

Business-to-business (B-to-B) marketers must understand
business markets and business buyer behavior
Business buying process: Determining which products and
services to purchase
Finding, evaluating, and choosing among alternative suppliers
and brands
Business buyer behavior refers to the buying behavior of the
organizations that buy goods and services for use in the
production of other products and services that are sold, rented,
or supplied to others.
Business-to-business (B-to-B) marketers must do their best to
understand business markets and business buyer behavior. Then,
like businesses that sell to final buyers, they must engage
business customers and build profitable relationships with them
by creating superior customer value.
The business buying process is the decision process by which
business buyers determine which products and services their
organizations need to purchase and then find, evaluate, and
choose among alternative suppliers and brands.
21

Business Markets
Business markets are huge and involve more money and items
than consumer markets.
Differ from consumer markets in terms of
Market structure and demand
Nature of the buying unit
Types of decisions and the decision process
The business market is huge and involves more dollars and
items than do consumer markets. Business markets differ from
consumer markets in terms of market structure and demand, the
nature of the buying unit, and the types of decisions and the
decision process involved.
22
Market Structure and Demand
Business market structure and demand
Fewer but larger buyers
Derived demand: Business demand that comes from the demand
for consumer goods
Inelastic and fluctuating demand
The business marketer normally deals with far fewer but far

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