Chapter 1 Consumer Behavior : Meeting Changes and Challenges

Presented By: Annisa Rahmiany (821511 Nensi Ratna Sari (8215118170)

What is consumers behavior?

Consumer Behavior that consumers display in searching for, purchasing, using, evaluating, and disposing products and services that they expect will satisfy their needs. Consumer Behavior includes all the decisions a consumer makes when spending their time and money.

 For Example This web link takes you to Googles shopping site which is still in BETA test mode. Google used to have a shopping portal, Froogle, which is no longer active. There are many online sites which influence us as consumers either in the information gathering, decision making, or final purchasing part of our decisions. you will buy a camera in a mall you will ask the salesman how to operate this what is the capacity of this what is

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

Development of the Marketing Concept

Production Orientation Sales Orientation

Marketing Concept

Production Orientation
During the production orientation, companies wanted efficient production lines to mass produce products for the consumer. Because the demand was higher than the supply, consumers were content to get a product and were not focused on product variation. This was the time that the control was in the hands of the producers who said, if we make it they will buy it.

Sales Orientation
There was overproduction during the production orientation, which led to excess product. Although the products were still similar and there was little variation, during the sales orientation period, the manufacturers focused on selling the product which they had overproduced.

Marketing Concept
Rather than focus on what can be manufactured, the focus shifts with the marketing concept to what consumers prefer. It became a time to put the customer first and to understand their needs and wants. With this information, marketers can deliver satisfaction to their target markets

Societal Marketing Concept

The societal marketing concept was developed from the marketing concept. Marketers and consumers are increasingly taking stock of what is good for themselves, their family, their country, and the planet. Marketing looks for opportunities to provide products and services to help consumers reach their goals while also making profitable decisions for their companies. The image in this slide of a Siemens ad suggests the company is committed to developing products that are safe for customers and the environment.

The Marketing Concept

Embracing the Marketing Concept
Consumer Research Segmentation Market Targeting Positioning
The process and tools used to study consumer behavior All companies must continually conduct research to understand the needs and priorities of their market segments.

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

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

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

The marketing mix

The marketing mix consists of four elements (4Ps) : 1. Product : the features, designs, brands, and pacaging of goods and services 2. Price : the list price, including discounts, allowances, and payment methods 3. Place : the distribution of the product or services through specific store and nonstrore outlets. 4. Promotion : the advertising, sales promotion, public relations, and personal selling efforts designed to build awareness of and demand for the goods and service

Customer Value, Satisfaction, Trust, and Retention

Successful Relationships
Customer value High level of customer satisfaction Strong sense of customer trust Customer retention

Successful Relationships
Value, Satisfaction, Trust, and Retention Customer Value Customer Satisfaction Customer Trust Customer Retention
Defined as the ratio between the customers perceived benefits and the resources used to obtain those benefits Perceived value is relative and subjective Developing a value proposition is critical

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

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.

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

Top 10 Ranked U.S. Companies in Terms of Consumers Trust and Respect of Privacy
Top 10 Companies American Express eBay IBM Amazon Johnson & Johnson Hewlett-Packard U.S. Postal Service Procter and Gamble Apple Nationwide

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

THE TRADITIONAL MARKETING CONCEPT

Make only what you can sell instead of trying to sell what you make. Do not focus on the product; focus on the need that it satisfies. Market products and services that match customers needs better than competitors offerings. Research consumer needs and characteristics. Understand the purchase behavior process and the influences on consumer behavior. Realize that each customer transaction is a discrete sale.

VALUE- AND RETENTION-FOCUSED MARKETING

Use technology that enables customers to customize what you make. Focus on the products perceived value, as well as the need that it satisfies. Utilize an understanding of customer needs to develop offerings that customers perceive as more valuable than competitors offerings. Research the levels of profit associated with various consumer needs and characteristics. Understand consumer behavior in relation to the companys product. Make each customer transaction part of an ongoing relationship with the customer.

Impact of Digital Technologies

Marketers More products and services through customization Instantaneous exchanges Collect and analyze data Consumers Power Information Computers, phones, PDA, GPS, smart TV

Consumer Behavior Is Interdisciplinary

Psychology

Economics

Sociology

Anthropology

Social psychology

A Simple Model of Consumer Decision Making

 This model will guide your studies of consumer behavior. The input stage includes sources of information to the consumer how they learn and are influenced by the marketer and their environment. The process stage ties to the decision-making process the consumer undergoes when considering a purchase. It moves from the inputs to the psychological factors involved in recognizing a need, searching for information, and evaluating alternatives. The output stage involves the actual purchase and the post-purchase evaluation. This post-purchase evaluation ties to the satisfaction topics discussed earlier in this presentation and the importance of customer loyalty to marketings profitability.

Thank you for attention