Principles of Marketing Tutorial 3 : Understanding Consumer Behaviour and

Organisation as Customers

Questions 1 and 2

Read the case Groupon: Helping Consumers with Purchase Decisions from Page 149-
152 of the textbook (Marketing in Asia, Second Edition). Answer Qn 3 and 4 at the end
of the case study.

3. Describe the five-stage purchase decision process for a typical Groupon user.

a. Problem Recognition

This is triggered by a Groupon deal-of-the-day e-mail offer for something that

someone wouldnt ordinarily do. Groupon Now presents real-time offers on
smartphone apps in response to an immediate need in a specific location.

b. Information Search

A Groupon offer can initiate an internal search, whereby the consumer might
reflect on prior experiences with merchant making the offer. Also, a Groupon
offer can activate an external search, leading to on-line comparisons with
competitors, or discussing the offer with friends on Facebook or Twitter.

c. Alternative Evaluation

Many Groupon customers focus on price as the most important evaluative

criteria, although other aspects of the offer, such as quality or time restrictions,
may also apply.

d. Purchase Decision

The purchase decision is made online and then confirmed when the deals tip.

e. Post-purchase Behavior.

After the purchase and use of the Groupon offer, consumers compare the
purchase and use experience with their expectations and are satisfied or
dissatisfied.
4. What are the possible psychological and sociological influences on the
Groupon consumer purchase decision process?

The recession has increased the importance of personal values such as thriftiness, so
deal-prone people who were attracted to websites such as Groupon.

Woman aged between 18 to 34 years old are affinity to social media hence enable the
use of Groupon, which depends on email and smartphone application to reach its
customers.

As Groupon has learned more about its subscribers, it has begun to personalize the
deals to suit their customers. They uses variables such as gender, location of residence
and buying history to match deals with the customers. Hence, the offers are more likely
to be of interest to consumers and allows Groupon to serve more merchants.

QUESTION 3

Brad Lau, more popularly known as Lady Iron Chef, is a famous food blogger in
Singapore. He has been regularly dishing out reviews of food and his dining
experiences of both new and long-standing restaurants since 2007. The blog is
one of the most read food blogs in Singapore, obtaining 31,000 hits from 12,000
unique visitors daily.

a) Discuss the type of sociocultural influence that Brad Lau has on Singapore
consumers.

The type of influence is opinion leadership. It refers to individuals who exert

direct or indirect social influence over others. Opinion leaders are considered
knowledgeable about or users of specific products, so their opinions have a
strong influence on others choice.

In this case, Brad Lau, is knowledgeable about food and shares his dining
experiences and food reviews of both new and long-standing restaurants with the
public. As one of the most read food blogs in Singapore, and obtaining 31,000
hits from 12,000 unique visitors daily, it shows that Brad Lau has a strong
influence on the consumers choice when they want to dine.

b) Information search is the second stage of the consumer purchase decision

process. Describe the source of information used when consumers
conduct an internet search on various food blogs for good dining places.

This search is referred to as external search. Conducting an internet search is a

public source for consumers because Brad Lau is an experienced and famous
food blogger. Hence, consumers feel that the information and opinion he gives, is
very reliable and true. It then affects their decision on dining outside or
encourage the consumers by going to some restaurants that may have been
recommended to them.

(Note : This is a past year common test question.)

Question 4

Mary has a chain of cafes, named Marys Best Food, selling Western set meals at
various locations in Singapore. The meals were cooked using traditional cooking
methods and they pride themselves in serving home-cooked food. Discuss the
three major types of business buying situations that Mary may be facing. Give at
least three examples for each type of buying situation. You may make reasonable
assumptions.

The 3 major types of business buying situation that Mary may be facing are straight
rebuy, modified rebuy and new buy.

Straight rebuy refers to where the buyer reorders an existing product or service from the
list of acceptable suppliers. For example, reorder from the same supplier on same
quality.

Modified rebuy refers to where users, influencers, or deciders in the buying center want
to change the product specifications, price, delivery schedule, or supplier, although the
item purchased is largely the same. For example, to suit the consumer better, she can
order organic products.

New buy refers to where the firm is a first-time buyer of the product or service and it
involve greater risk. For example, for new cooking purposes, she can buy new oven and
cookers if needed.

END