consumer behaviour module 1

8/8/2019 consumer behaviour module 1

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Consumer behavior

The term consumerbehavioris defined as

the behaviorthat consumers displayin

searching for, purchasing, using,evaluatingand disposing ofproducts and services that

theyexpect will satisfy theirneeds.


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Difference between customers

and consumers

Every customeris a consumerbut not every

consumera customer. Customeris one who is

brand loyal, who has madea custom to purchasea

particularcompany's product/services. thuscustomeris a sub set ofconsumer.

One that consumes,especially one that acquires

goods orservices fordirect use orownership rather

than forresale orusein production andmanufacturing. A consumeris an end user.

A customer: One that buys goods orservices. A

customercan in turn resell to a consumer.


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Why We Study CB?

Diverse Reasons -

As Consumers

As Marketers & future Marketers As Students ofHuman Behavior


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Consumer Benefits

Tangible Benefits measurable

Intangible benefits associated with the

feelings that you experience


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Two different kinds ofconsuming entities

Personal consumer

Organizational consumer


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Personal Consumer

Theindividual who buys goods and

services forhis orherown use,for

household use,for the use ofafamily

member, orforafriend.


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Organizational Consumer

A business, government agency, or

otherinstitution (profit ornonprofit)

that buys the goods, services,and/orequipment necessaryfor the

organization to function.


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Development of the Marketing ConceptProduction

Concept

Selling Concept

Product Concept

Marketing

Concept


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The Production Concept

Assumes that consumers areinterested

primarilyin product availabilityat low

prices

Marketing objectives:

Cheap,efficient production

Intensive distribution Market expansion


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The Product Concept

Assumes that consumers will buy the

product that offers them thehighest

quality, the best performance,and the

most features


Qualityimprovement Addition offeatures

Tendency toward Marketing Myopia


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The Selling Concept

Assumes that consumers are unlikely to

buya product unless theyareaggressively

persuaded to do so


Sell, sell, sell

Lack ofconcern forcustomerneeds andsatisfaction


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The Marketing Concept

Assumes that to be successful,a company

must determine theneeds and wants of

specific target markets and deliver thedesired satisfactions better than the

competition

Marketing objectives: Profits through customersatisfaction


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The Marketing Concept

A consumer-oriented philosophy that

suggests that satisfaction ofconsumerneeds provides thefocus forproduct

development and marketing strategy to

enable thefirm to meet its ownorganizational goals.


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Marketing Concept is based on the

premise that amarketershould

make what it can sell,instead oftrying to sell what it has made


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Implementing the Marketing Concept

ConsumerResearch

Segmentation

Targeting

Positioning


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ConsumerResearch

The process and tools used to study

consumerbehavior.

Two perspectives: Positivist approach

Interpretivist approach


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Segmentation,Targeting,and

Positioning

Segmentation: process ofdividing the

market into subsets ofconsumers with

common needs orcharacteristics

Targeting: selecting one oremore of the

segments to pursue

Positioning: developing a distinct imageforthe product in themind of the consumer


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Successful Positioning

Communicating the

benefits of the

product, rather than

its features

Communicating a

Unique Selling

Proposition for the

product


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The Marketing Mix Product

Price

Place Promotion


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Successful Relationships

CustomerValue

CustomerSatisfaction

CustomerRetention


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Types ofCustomers

Loyalists

Apostles Defectors

Terrorists

Hostages Mercenaries


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Customer retention

Makes it in the best interest ofcustomers to staywith the companyratherthan switch to anotherfirm

Customers are grouped into four tiers:

The platinum tier:heavy users, not price sensitive The gold tier: Heavy users, not profitable, price

sensitive

Theiron tier: spending volumeand profitability do

not merit special treatment form the company The lead tier: customers who actually cost the

company by spreading negative word ofmouth


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Ethics & social responsibility

All companies prosperwhen society

prospers,many people believe that all ofus,

companies as well as individuals, would be

betteroffifsocial responsibility werean

integral part ofeverymarketing decision.


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Societal Marketing Concept

A revision of the traditional marketing concept

that suggests that marketers adhere to

principles ofsocial responsibilityin themarketing of theirgoods and services; that is,

theymust endeavor to satisfy the needs and

wants of their target markets in ways that

preserveand enhance the well-being ofconsumers and societyas a whole.


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The Societal Marketing Concept

The societal marketing concept,advocates

a long term perspective.

It recognize that all companies would bebetteroffin a stronger,healthiersociety,

and that companies that incorporate

ethical behaviorand social responsibilityin

all of theirbusiness dealings and maintain

loyal consumersupport over the long run.


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Nature and characteristics of

Indian consumer

The Indian consumption patterns are slowlyconverging with global norms.

The Indian consumeris now spending moreon consumerdurables,apparel,entertainment,vacations and lifestylerelatedactivities.

Entertainment, clothing and restaurant diningare categories that have been witnessing amaximumrisein consumerspending since2002.


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Therate ofgrowth ofspending on

discretionaryitems (unlike basic necessities

likefood) has been growing at an average of

9 percent peryearoverthe past fiveyears. A

nation ofsavers, India,has now altered into a

nation ofspenders.


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Consumerism

Themovement seeking to protect and inform

consumers byrequiring such practices as

honest packaging and advertising, product

guarantees,and improved safety standards.

Movement orpolicies aimed at regulating the

products, services,methods,and standards

ofmanufacturers, sellers,and advertisers intheinterests of the buyer.


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Rights of consumers

Right to safety

Right to be informed

Right to choose Right to be heard

Right to seek redressal

Right to consumer education


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Responsibilities of Consumers

Responsibility of self-help

Proof of Transactions

Proper claim Proper use of Product/services

consumer behaviour module 1

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