Consumer Behaviour Chapter 1

Consumer behaviour have changed dramatically in the past decade .

An Introduction to The Study of Consumer Behavior

consumer behavior

Definition:
The behaviour that consumer displays in searching , purchasing, using , evaluating and disposing of the product or services that they expect will satisfy their needs.

 There are two kinds of consumers:

1- Personal consumer 2-Orgnizational consumer

 Development of the marketing concept and the discipline of consumer behaviour -Production concept -Product concept -Selling concept

 The Marketing concept

Consumer needs and wants became the firms primary focus.

 Implementing the marketing concept

(Through doing research and using strategic tools)

 Segmentation, Targeting and positioning

-With a large country -Many different types of people it is too difficult to create a product that will satisfy everybody, that is why we focus on a segment of the total market

Segmentation
-The process of dividing a market into subsets of consumers with common needs or characteristics.

Targeting
-Targeting is selecting one or more of segments identified for the company to pursue.

Positioning
Positioning is developing a distinct image for the product or service in the mind of the consumer, an image that will differentiate the offering from competing ones and squarely communicate to consumers that the particular product or service will fulfill their needs better than competing brands.

 The marketing mix (product and service offered by the company to consumers and the tools selected to accomplish the exchange)

-Product -Price -Promotion -Place(distribution)

Customer value, satisfaction and retention

 Providing Customer Value

Definition:
Customer Value is defined as the ratio between the customers perceived benefits and the resources used to obtain those benefits.

 Customer Satisfaction Definition:

Customer satisfaction is the individuals perception of performance of the product or service in relation to his or her expectations.

 Customer Retention
Definition:

Makes it in the best interest of customer to stay with the company rather than switch to another firm.
1-loyal customers buy more products

2-loyal customers are less price sensitive and pay less attention to competitors' advertising
3-servising existing customers, who are familiar with the firms offerings and process, is cheaper 4-loyal customers spread positive word-of-mouth and refer to other customers.

 The impact of Digital Technologies on marketing strategies

-Consumers have access to more information than ever before

 Consumer have more power than ever before -Locate best prices , bids. -Pass distribution outlets. -Shop goods around the globe to their homes. Consumer have access to more information than before
-Easily find reviews for the product -Click the button to compare the features of different product models of the site of an online retailers.

 Challenge Marketers Face( ex. specialized digital recorders)

 Marketing Ethics and social responsibility

Firms have become viewed as responsible for more than generating profits. Corporate social responsibility refers to the idea that firms have an obligation to help the larger society by offering some of their resources. A businesss self-interest could be advanced if the business embraced a long-run view. This position would permit expenditures in support of socially responsible activities and provide future benefits in the form of consumer approval and loyalty.

 One way of showing that companies are socially responsible is by creating a positive public image. Another way that firms can show they are socially responsible is by making speedy product recalls. Public peace of mind can be corrupted by diffusion of rumors. Rumors often plague both large and small companies.

 Consumer behavior and Decision-Making are Interdisciplinary(rational,emotion,mood and situations).

 A simplified Model of Consumer Decision Making 1-Input 2-Process 3-Output

External Influence
Firms marketing efforts 1-product 2-promotion 3-price 4-channels of distribution Sociocultural Environment 1-Family 2-Informal sources 3-other non-commercial sources 4-social class 5-cultural and subculture

Input

Consumer decision- making

Need Recognition Pre-Purchase search Evaluation of alternatives Psychological Field 1-Motivation 2-Perception 3-Learning 4-Personality 5-Attitudes Experience

Process

Post decision behaviour

Purchase 1-Trial 2-Repeat purchase

output
Post-Purchase Evaluation

Discussion Questions
1- Describe the interrelationship between consumer behavior and the marketing mix? 2-Describe the interrelationship between consumer research ,market segmentation and targeting and the development of the marketing mix for a manufacturer of high definition television sets? 3-Define the societal marketing concept and discuss the importance of integrating marketing ethics into the companys philosophy and operations?

4-Discuss the interrelationships among customer expectations and satisfaction perceived value and customer retention essential? 5-Discuss the role of the social and behavioral science in developing the consumer decisionmaking model? 6-Apply the two models depicted in table 1-3 to the marketing of mobile phone services?