Consumer Behaviour

Development of the Marketing Concept

Production ept- Due to Mass Production System

Product Concept Selling Concept Marketing Concept

Based on concepts from

Psychology Sociology Anthropology Marketing Economics

Why do we need to study Consumer Behaviour?

Because no longer can we take the customer/consumer for granted.

Failure rates of new products introduced

Out of 11000 new products introduced by 77 companies, only 56% are present 5 years later. Only 8% of new product concepts offered by 112 leading companies reached the market. Out of that 83% failed to meet marketing objectives.

Can Marketing be standardised?

No. Because cross - cultural styles, habits, tastes, prevents such standardisation.

Unless Managements act

The more successful a firm has been in the past, the more likely is it to fail in the future.

Why?
Because people tend to repeat behaviour for which they have been rewarded.

Language Problems
Interpret this sentence:Finger Licking good You will eat your fingers in Hongkong

Come alive with Pepsi

Come alive out of the grave Germany Pepsi brings your ancestors back from the grave China Hall mark in France

Buyer Behaviour

Consumer Marketing Environment Buyer Characteristics Buyer Decision Process Buyer Decision

4Ps

Marketing Stimuli

4 Ps Product Price Place Promotion

Other Stimuli

Marketing Environment Economic Technological Political Cultural

Buyer characteristics
Cultural Social Personal Psychological

Buyers Decision Process

Problem Recognition Information Search Evaluation of Alternatives Purchase Decision Consumption Postpurchase behaviour

Buyers Decision
Product Choice Brand Choice Dealer Choice Purchase Timing Purchase Amount

Cultural factors
Culture Sub - culture Social Class

Social factors
Reference Groups Family Roles and Status

Personal Factors
Family Life Cycle Occupation and Economic circumstances Lifestyle Personality and self - concept

Psychological Factors
Motivation Perception Learning Beliefs and Attitudes

Buying Roles
Initiator Influencer Decider Buyer User

Buying Behaviour
Complex Dissonance - Reducing Habitual Variety seeking

Buying Process
Problem Recognition Information Search Evaluation Alternatives Purchase Decision

Post - Purchase Behaviour

Satisfaction Actions Use and Disposal

What is Consumer Behaviour?

Those activities directly involved in obtaining , consuming and disposing of products and services, including the decision processes that precede and follow these actions

This study draws on concepts from various other disciplines

Psychology Sociology Anthropology Economics Marketing

Need to study ?
You cannot take the consumer for granted any more Therefore a sound understanding of consumer behaviour is essential for the long run success of any marketing program

Perspectives

1.

2.

Logical Positivism Understanding and predicting consumer behaviour Cause and effect relationships that govern persuasion and/or education Post Modern to understand consumption behaviour without any attempt to influence it

Why is this important?

Out of 11000 products launched by 77 companies, only 56% are present five years later Kuczmaski & Associates Only 8% of new product concepts offered by 112 leading companies reached the market. Out of this 83% failed to reach marketing objectives

Group EFO Ltd., Marketing News, Feb 1, 1993, Pg 2

MEET THE NEW CONSUMER and smile when you do because she is your boss. It may not be the person you thought you knew. Instead of choosing from what you have to offer, she tells you what she wants. You figure it out how to give it to her.
-Fortune Editor

A new product must satisfy consumer needs, not the needs and expectations of management.
Understanding and adapting to consumer motivation and behaviour is not an option it becomes a necessity for competitive survival

Consumer sovereignty presents a formidable challenge but skilful marketing can affect both motivation and behaviour if the product or service offered is designed to meet consumer needs and expectations
A sales success occurs because demand either exists already or is latent and awaiting activation by the right marketing offering

Dominant forces shaping Consumer Research

Factors that move an economy from Production-driven to Market-driven Level of sophistication with which human behaviour is understood in psychology and other behavioural sciences

Environmental factors that affect the marketing challenge

Extent to which the supply of valid products and services exceed consumer demand Ability to communicate with customers quickly and accurately Existence of multiple avenues of distribution quickly and economically Extent to which marketers can influence to induce distributors to comply with overall marketing strategy Economic growth, both nationally and globally

Motivational Research
It seeks to learn what motivates people in making choices. The techniques are such as to delve into the conscious, subconscious and the unconscious. women dont buy cosmetics, they buy hope. women bake cakes out of the unconscious desire to give birth

The advice to footwear salesmen should be Dont sell shoes sell lovely feet
Marketers must contend with small changing segments of highly selective buyers intent on receiving genuine value at the lowest price

All managers must become astute analysts of Consumer motivation and Behaviour
Three foundations for marketing decisions Experience Intuition Research

Enhancing Consumer Valueadded

Marketers have to constantly innovate after understanding their consumers to strip out costs permanently by focusing on what adds value for the customer and eliminating what doesnt.

Individualised Marketing
A very personal form of marketing that recognises, acknowledges, appreciates and serves individuals who become or are known to the marketer. Data based marketing; DM Customized marketing

Variables involved in understanding consumer behaviour

Stimulus ads, products, hungerpangs Response physical/mental reaction to the stimulus Intervening variables mood, knowledge, attitude, values, situations, etc.

Overall Model of Consumer Behaviour

External Influences Culture Subculture Demographics Social status Reference groups Family Marketing Activities Self-Concept & Learning Internal Influences Perception Learning Memory Motives Personality Emotions Attitudes Decision Processes

Problem Recognition
Information Search Alt Eval & Selection Outlet select & Purchase

Postpurchase Processes