Consumer Buying Behaviour (Lecture 1)

7/27/2019 Consumer Buying Behaviour (Lecture 1)

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CONSUMER BEHAVIOUR-1

Prof.Deepika


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Index

1. Diversity of consumer behavior

2. Role of consumer behavior in marketingstrategy


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What is Consumer Behavior

Consumer Behavior:

It is defined as behavior that consumer display in searching for,purchasing, using, evaluating & disposing of products & servicesthat they except will satisfy their needs.

Needs of consumer

Food, cloth, shelter

Transportation

Education

Equipment

Vacations

Luxuries Services

Ideas

Need is shaped by the environment & the culture in which we live, by our

education & by experience.


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Involves thoughts and feelings people experience andactions they perform in the consumption processes

Includes all things in the environment that influence

thoughts, feelings, and actions. Comments from other consumers

Advertisements

Price information

Packaging

Product appearance


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Trends in Marketing concept

1850 to 1920- Product Orientation-Gearing upmanufacturing skill to expand production

1930 to 1950- Sales Orientation-to sell all those goodswhich are manufactured, whatever being produced sellit.

1950 onwards- Marketing Orientation- it is time to focuson consumer preference or specific needs


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Marketing MixThe Four Ps

(Distribution)

roduct

ricing

romotion

lace


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Classifying Products

Consumer

Convenience Goods

Shopping Goods Specialty Goods

Industrial

Expense Items

Capital Items


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The Promotional Mix

Advertising

PersonalSelling

SalesPromotions

PublicRelations


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Market Segmentation & Target Marketing

Market Segmentation

Dividing a market intocustomer categories

Target Marketing

Selecting a category of customerswith similar wants and needs whoare likely to respond to the same

products


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Why Segmentation is Necessary

Consumer needs differs

Differentiation helps

products compete

Segmentation helps

identify media


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Criteria for Effective

Targeting

Identifiable Sizeable

Stable Accessible

Congruent with thecompanys objectives

and resources


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Positioning

Positioning is theunifying element ofeach marketing mix.Product, place,

price, andpromotionalstrategies to work tostate of the product

or services ability todeliver benefits tothe consumer


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Which Distinct Benefit Does Each of

the Two Brands Shown in This Figure

Deliver?

Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall 14 Chapter Three Slide


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The Dentyne Ads Benefit is Fresh Breath and the

Nicorette Ad is Whitening and Smoking Cessation

Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall 15 Chapter Three Slide


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Bases for Segmentation


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Consumer-Rooted Segmentation Bases

Demographics

Geodemographic

Personality Traits

Lifestyles

Sociocultural


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Demographic Segmentation

Age Gender

Marital StatusFamily Life-

cycle

Income,Education, and

Occupation


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Geodemographic Segmentation

Based on geography and demographics

People who live close to one another are similar

Birds of a feather flock together


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Lifestyles

Psychographics

Includes activities,

interests, and opinions

They explain buyers

purchase decisions and

choices


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Socio-Cultural Values and Beliefs

Sociological = group

Anthropological = cultural

Include segments based on Cultural values

Sub-cultural membership

Cross-cultural affiliations


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Consumption-Specific

Segmentation Bases

Usage rate

Usage situation

Benefit segmentation

Perceived brandloyalty

Brand relationship


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Consumption-Specific Segmentation

Usage-Behavior

Usage rate- Usage rate is often based on whether agroup of consumers are heavy, medium, light, or

nonusers of a product

Awareness status

Level of involvement

23


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Consumption-Specific Segmentation

Usage-Behavior

Usage-situation segmentation

WHEN a given product is used

Segmenting on the basis of special occasions or

situations

People might consume certain products for specialevents, certain days of the week, or certain timesduring the year

Example : Rise of sales in chocolate and flowers forValentines Day.


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Benefits Segmentation

Benefits sought represent consumer needs

Important for positioning

Benefits of media


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Consumer Behavior

Psychological Influences

Personal Influences

Social Influences

Cultural Influences

Why do

consumers

purchase and

consume

products?


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PostpurchaseEvaluationPurchaseDecisionEvaluation ofAlternatives

The Consumer Buying Process

InformationSeekingProblemRecognition

Psychological Personal Social Cultural

Personal & Environmental Factors

Product Pricing Promotion Place

Marketing Factors


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Importance of Consumer Buying

behavior

With the rise of Marketing Orientation market

has huge brands and products to drag customer

Savvy marketer focus on 4 derivers

1. Customer value

2. High level of customer satisfaction

3. Customer trust

4. Building a structure that ensure customer

retention


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Customer value

It is the ratio between the customers perceived

benefits (economical, functional & psychological)

and the resources (monetary, time, efforts,

psychological) used to obtain those benefits

Developing a value proposition- successful

positioning of brand

Customer visiting at Mc Donald resturant Lexus claims to deliver superior quality, zero

defects and personal post purchase services


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Customer satisfaction

It is the individual consumers perception of the performance ofthe products & services in relation to his or her expectation

A completely satisfied customer is loyal or apostles who providepositive word of mouth

Defector who is neutral

Terrorist who has negative experience and provide negative wordof mouth

Hostages who are unhappy and they stay due to low price ormonopolistic

Mercenaries who being merely stratified, dont have real loyaltywho can shift at low price


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Customer trust

Closely related to satisfaction

According Nielsens customized research

study 78% trusting sources are Word of mouth communication

Recommendation by customer to other

Other sources are newspaper, posts online,brand website


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Customer retention

It is more expensive to secure new customerthan to keep existing ones

Loyal customer buy more products Less price sensitive

Pay less attention to competitors ads

Servicing existing customer is easy


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Contd..

Customer retention company focus on buying patternand classify customers in tiers

1. The Platinum tier- willing to try new offering, less pricesensitive

2. The gold tier- heavy users but price sensitive

3. The iron tier- customer whose spending volume &profitability do not merit special treatment fromcompany

4. The Lead tier-customers who are actually cost to thecompany because they claim more attention & spreadnegative word of mouth


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THANK YOU

Consumer Buying Behaviour (Lecture 1)

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