Consumer Behaviour

2. The behavior that consumers
display in searching for,
purchasing, using, evaluating,
and disposing of products and
services that they expect will
satisfy their needs.

3. How consumers make decisions to
spend their resources: time, money,
effort.
What they buy, when they buy, where
they buy, how often they buy, how
they evaluate it, how they dispose .

4. Allows customization of products,
services, and promotional
messages like never before.
Enhances relationships with
customers more effectively and
efficiently.

5. Customers Search for Products
weblink

6. Increased consumer power
Access to information
More products and services
Interactive and instant
exchanges
Access to customer patterns and
preferences

7. The individual who buys goods
and services for his or her own
use, for household use, for the
use of a family member, or for a
friend.

8. A business, government agency,
or other institution (profit or
nonprofit) that buys the goods,
services, and/or equipment
necessary for the organization to
function.

9. Production
Concept
Product Concept
Selling Concept
Marketing
Concept

10. It’s Also called :
Company orientation towards
market place

11. Developed by Henry Ford in
early 1900s.
Consumers buy product which
has low price.
Cheap & efficient production and
Intensive distribution.
To expand the market.

12. Consumers buy the product
having highest quality, best
performance & most features.
Strive to constantly improve the
quality & add new features.
Leads to Marketing myopia.

13.  Primary focus is to sell the product that
has been decided unilaterally.
 Consumers are unlikely to buy the product
unless aggressively persuaded.
 Lack of concern for customer needs and
satisfaction.
 Unsought goods like insurance,
encyclopedia etc.
 Negative word of mouth.

14. Emerged in 1950s.
Satisfying needs & wants of
consumers.
Assumes that to be successful, a
company must determine the
needs and wants of specific target
markets and deliver the desired
satisfactions better than the
competitors.

15. Philosophy shifted from ‘Make &
Sell’ to ‘Sense & Respond’.
Find right products for your
customers.

16. A consumer-oriented philosophy
that suggests that satisfaction of
consumer needs provides the
focus for product development
and marketing strategy to enable
the firm to meet its own
organizational goals.

17. Consumer Research
Segmentation
Targeting
Positioning

18. The process and tools used to
study consumer behavior.
Two perspectives:
Positivist approach
Interpretive approach

19.  Segmentation: process of dividing the
market into subsets of consumers with
common needs or characteristics.
 Targeting: selecting one ore more of the
segments to pursue.
 Positioning: developing a distinct image
for the product in the mind of the
consumer.

20. Segmentation Used by Sports
Illustrated

21. Communicating the benefits of the
product, rather than its features.
Communicating a Unique Selling
Proposition for the product.

22. This product is
positioned as a
solution to
facial redness.

23. Product
Price
Place
Promotion

24. Customer
Value
Customer
Retention
Customer
Satisfaction

25. Customer Value:
It’s a ratio between the customer’s
perceived benefits (economic,
functional & psychological) & the
resources (time, money, effort) used
to obtain those benefits.

26. Customer Satisfaction:
It’s the individual’s perception
of the performance of the
product or service I relation to
his or her expectations.

27. Customer Retention:
Policy of company in the best
interest of customers to stay
with the company rather than
switch to another company.

28. Advantages of loyal customers:
1. Buy more products.
2. Less price sensitive & pay less
attention to competitors’ advertises.
3. Serving to existing customers is
cheaper.
4. Positive word of mouth.

29. Customer Profitability-Focused
Marketing
 Tracks costs and revenues of individual
consumers
 Categorizes them into tiers based on
consumption behavior
 A customer pyramid groups customers
into four tiers

30. Tier 1: Platinum
Tier 2: Gold
Tier 3: Iron
Tier 4: Lead

31.  Platinum Tier:
Heavy users who are not price sensitive &
willing to buy new offers.
 Gold Tier:
Heavy users but little price sensitive, less
profitable.
 Iron Tier:
Customers whose spending & profitability do
not merit for special treatment.
 Lead Tier:
Customers who cost to company because they
claim more attention than is merited by their
spending.

32. Traditional Marketing Concept Vs. Value and
Retention Focused Marketing :Table
Traditional Marketing
Concept
Value and Retention
Focused Marketing
Make only what you can sell
instead of trying to sell what
you make
Use technology that enables
customers to customize what you
make
Do not focus on the product;
focus on the need that it
satisfies
Focus on the product’s perceived
value, as well as the need that it
satisfies
Market products and services
that match customers’ needs
better than competitors’
offerings
Utilize an understanding of
customer needs to develop
offerings that customers perceive
as more valuable than competitors’
offerings

33.  A revision of the traditional marketing concept
that suggests that marketers adhere to
principles of social responsibility in the
marketing of their goods and services.
 That is, they must endeavor to satisfy the
needs and wants of their target markets in
ways that preserve and enhance the well-being
of consumers and society as a whole.

34.  All companies prosper when society
prospers.
 Companies, as well as individuals, would
be better off if social responsibility was an
integral component of every marketing
decision.
 Requires all marketers adhere to
principles of social responsibility.

35. Input
External
Influence
Firm’s Marketing Efforts
1. Product
2. Promotion
3. Price
4. Channels of distribution
Sociocultural Environment
1. Family
2. Informal sources
3. Other noncommercial
sources
4. Social class
5. Subculture and culture
Process
Need
Recognition
Prepurchase
Search
Evaluation of
Alternatives
Psychological Field
1. Motivation
2. Perception
3. Learning
4. Personality
5. Attitudes
Experience
Output
Purchase
1. Trial
2. Repeat purchase
Post purchase
Evaluation
Figure 1-1:
A Model of
Consumer
Decision Making