Transcript Meeting Changes and Challenges

CHAPTER
ONE
Consumer Behavior:
Meeting Changes and
Challenges
Learning Objectives
1. To Understand What Consumer Behavior Is and the
Different Types of Consumers.
2. To Understand the Relationship Between Consumer
Behavior and the Marketing Concept, the Societal
Marketing Concept, as Well as Segmentation, Targeting,
and Positioning.
3. To Understand the Relationship Between Consumer
Behavior and Customer Value, Satisfaction, Trust, and
Retention.
4. To Understand How New Technologies Are Enabling
Marketers to Better Satisfy the Needs and Wants of
Consumers.
Chapter One Slide 2
Learning Objectives (continued)
5. To Understand How Marketers Are
Increasingly Able to Reach Consumers
Wherever Consumers Wish to Be Reached.
6. To Understand How the World’s Economic
Condition Is Leading to Consumption
Instability and Change.
7. To Understand the Makeup and Composition
of a Model of Consumer Behavior.
Chapter One Slide 3
Who Is a Customer ?
I'm the fellow who goes into a restaurant, sits down
and patiently waits while the waitresses do everything
but take my order. I'm the fellow who goes into a
department store and stands quietly while the sales
clerks finish their little chitchat. I'm the man who drives
into a gasoline station and never blows his horn, but
waits patiently while the attendant finishes reading his
comic book.
4
Consumer Behavior
• The behavior that consumers display in
searching for, purchasing, using, evaluating,
and disposing of products and services that
they expect will satisfy their needs.
Chapter One Slide 5
Two Consumer Entities
Personal Consumer
• 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.
Organizational
Consumer
• A business,
government agency,
or other institution
(profit or nonprofit)
that buys the goods,
services, and/or
equipment necessary
for the organization to
function.
Chapter One Slide 6
Development of the
Marketing Concept
Production
Orientation
Sales
Orientation
Marketing
Concept
Chapter One Slide 7
Production Orientation
• From the 1850s to the late 1920s
• Companies focus on production capabilities
• Consumer demand exceeded supply (D > S)
“if we make it they will buy it”
Chapter One Slide 8
Sales Orientation
• From the 1930s to the mid 1950s
• Focus on selling
• Supply exceeded customer demand (S > D)
Production
Orientation
Sales
Orientation
Marketing
Concept
Chapter One Slide 9
Marketing Concept
• 1950s to current - Focus on the customer!
• Determine the needs and wants of specific
target markets
• Deliver satisfaction better than competition
Production
Orientation
Sales
Orientation
Marketing
Concept
Chapter One Slide 10
Discussion Questions
1. What two companies do
you believe grasp and use
the marketing concept?
2. Why do you believe this?
Chapter One Slide 11
What is the Marketing Concept?
• A company must determine the needs and
wants of specific target markets and deliver
the desired satisfactions better than the
competition.
• E.g KFC
• McDonald’s
12
Societal Marketing Concept
• Considers consumers’ long-run best interest
• Good corporate citizenship
• The company is committed to developing
products that are safe for customers and the
environment.
Chapter One Slide 13
The Marketing Concept
Embracing the Marketing
Concept
•
•
•
•
Consumer Research
Segmentation
Market Targeting
Positioning
• The process and tools
used to study consumer
behavior
Chapter One Slide 14
The Marketing Concept
Implementing the
Marketing Concept
•
•
•
•
Consumer Research
Segmentation
Market Targeting
Positioning
• Process of dividing the
market into subsets of
consumers with
common needs or
characteristics
Chapter One Slide 15
Discussion Questions
1. What products that you regularly purchase
are highly segmented?
2. What are the different segments?
3. Why is segmentation useful to the marketer
for these products?
Chapter One Slide 16
The Marketing Concept
Implementing the
Marketing Concept
•
•
•
•
Consumer Research
Segmentation
Market Targeting
Positioning
The selection of one or
more of the segments
identified to pursue
Chapter One Slide 17
The Marketing Concept
Implementing the
Marketing Concept
•
•
•
•
Consumer Research
Segmentation
Market Targeting
Positioning
• Developing a distinct image for
the product in the mind of the
consumer
• Successful positioning includes:
– Communicating the benefits
of the product
– Communicating a unique
selling proposition
Chapter One Slide 18
The Marketing Mix
Product
Price
Marketing
Mix
Place
Promotion
Chapter One Slide 19
Customer Value, Satisfaction, Trust,
and Retention
Successful Relationships
Customer
value
High level
of
customer
satisfaction
Strong
sense of
customer
trust
Customer
retention
Chapter One Slide 20
Successful Relationships
Value, Satisfaction,
• Defined as the ratio between
Trust, and Retention the customer’s perceived
• Customer Value
• Customer
Satisfaction
• Customer Trust
• Customer
Retention
benefits and the resources
used to obtain those
benefits
• Perceived value is relative
and subjective
• Developing a value
proposition is critical
Chapter One Slide 21
Discussion Questions
• How does McDonald’s
create value for the
consumer?
• How do they
communicate this
value?
Chapter One Slide 22
Successful Relationships
Value, Satisfaction,
Trust, and Retention
• Customer
Value
• Customer
Satisfaction
• Customer Trust
• Customer
Retention
• The individual's perception
of the performance of the
product or service in
relation to his or her
expectations.
• Customer groups based on
loyalty include loyalists,
apostles, defectors,
terrorists, hostages, and
mercenaries
Chapter One Slide 23
Successful Relationships
Value, Satisfaction,
Trust, and Retention
• Customer Value
• Customer
Satisfaction
• Customer Trust
• Customer
Retention
• Establishing and
maintaining trust is
essential.
• Trust is the
foundation for
maintaining a longstanding relationship
with customers.
Chapter One Slide 24
Successful Relationships
Value, Satisfaction,
Trust, and Retention
• Customer Value
• Customer
Satisfaction
• Customer Trust
• Customer
Retention
• The objective of providing
value is to retain highly
satisfied customers.
• Loyal customers are key
– They buy more products
– They are less price
sensitive
– Servicing them is
cheaper
– They spread positive
word of mouth
Chapter One Slide 25
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
Platinum
Gold
Iron
Lead
Chapter One Slide 26
THE 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.
Research consumer needs and characteristics.
Research the levels of profit associated with
various consumer needs and characteristics.
Understand the purchase behavior process and Understand consumer behavior in relation to
the influences on consumer behavior.
the company’s product.
Realize that each customer transaction is a
discrete sale.
Make each customer transaction part of an
ongoing relationship with the customer.
Chapter One Slide 27
Impact of Digital Technologies
Marketers
Consumers
• More products and
services through
customization
• Instantaneous exchanges
• Collect and analyze data
• Power
• Information
• Computers, phones, PDA,
GPS, smart TV
Chapter One Slide 28
The Mobile Consumer
• Wireless Media
Messages will
expand as:
Penetration of Internet Usage Among Mobile
Subscribers in 16 Countries
– Flat-rate data
traffic increases
– Screen image
quality is enhanced
– Consumer-user
experiences with
web applications
improve
Copyright 2010 Pearson Education, Inc. publishing as Prentice Hall
Chapter One Slide 29
Consumer Behavior Is
Interdisciplinary
Psychology
Economics
Anthropology
Sociology
Social
psychology
Chapter One Slide 30
A Simple Model of Consumer Decision Making
Chapter One Slide 31
Stages in the
Consumption Process
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