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Marketing Strategy and

Consumer Behavior
Javed Aslam Janjua
Riphah International University,
The Marketing Car
Consumer behaviour ‘the
Marketing manager
engine of marketing’

Advertising Market research

Marketing Strategy and
Consumer Behavior
Marketing Strategy and
Consumer Behavior
Step 1. Market Analysis
Marketing Strategy begins with an
analysis of the market the
organization is considering, requiring
a detailed analysis of the:
•organization’s capabilities
•strengths and weaknesses of competitors
•economic and technological forces
•current and potential customers
Marketing Strategy and
Consumer Behavior
Step 2. Market Segmentation
On the basis of the consumer
analysis, the organization
identifies groups of individuals,
households, or firms with similar
needs. These market segments
are described in terms such as
demographics, media
preferences, geographic
location, etc.
Management then selects the
segment(s) to target.
Marketing Strategy and
Consumer Behavior
Step 3. Marketing Strategy
Marketing Strategy seeks to
provide the customer with more
value than the competition, while
still producing a profit for the firm.
Marketing strategy is formulated in
terms of the marketing mix, which
involves determining the product
features, price, communications,
distribution and services that will
provide customers with superior
value, resulting in the total
Marketing Strategy and
Consumer Behavior
Step 4. Consumer Decision Process
The total product is presented to the
target market, which is consistently
engaged in processing information
and making decisions designed to
maintain or enhance its lifestyle or

Many firms are wrapping

experiences around their traditional
products and service in order to sell
them better. For example, retailers
have been moving to lifestyle
centers in an effort create a more
pleasing shopping experience.
Marketing Strategy and
Consumer Behavior
Step 5. Outcomes
Society – the cumulative effect of the
marketing process affects economic
growth, pollution, social problems.
Firm – reaction of the target market
to the total product produces an
image of the
Individual – the process results in
some level of need satisfaction,
financial expenditure, attitude
development/change, and/or
behavioral changes.
Step 1: Market Analysis Components

1. The Consumers

2. The Company

3. The Competitors

4. The Conditions
Step 1: Market Analysis Components
The Consumers
It is not possible to anticipate
and react to customers’ needs
and desires without a complete
understanding of consumer
Discovering customers’ needs
is a complex process, but it can
often be accomplished by
marketing research.
Step 1: Market Analysis Components
The Company
A firm must fully understand its own ability to meet customers
needs. This involves evaluating all aspects of the firm including:
• financial condition
• general managerial skills
• production capabilities
• R&D capabilities
• technological sophistication
• reputation, and
• marketing skills
Step 1: Market Analysis Components
The Competitors
It is not possible to consistently
do a better job of meeting
customer needs than the
competition without a thorough
understanding of the
competition’s capabilities and
This requires the same level of
knowledge of a firm’s key
competitors that is required on
one’s own firm.
Step 1: Market Analysis Components
The Conditions
The state of the economy, the
physical environment,
government regulations, and
technological developments
affect consumer needs and
expectations as well as
company and competitor
Step 2: Market Segmentation

Market segmentation is
a portion of a larger
market whose needs
differ from the larger

Step 2: Market Segmentation
Market Segmentation Involves Four Steps:

1. Identifying Product-Related Need Sets

2. Grouping Customers with Similar Need Sets

3. Describing Each Group

4. Selecting an Attractive Segment(s) to Serve

Step 2: Market Segmentation
1- Product-Related Need Sets
• Organizations approach market segmentation with a
set of current and potential capabilities.
• The term need set is used to reflect the fact that most
products in developed economies satisfy more than one
• Customer needs are not restricted to product features
but also include types and sources of product
information, outlets where the product is available,
product price, the image of the product or firm, and
even where and how the product is produced.

Step 2: Market Segmentation
2- Customers with Similar Need Sets
The next step is to group consumers with similar need sets.
These consumers can be
grouped into one segment
as far as product features
and perhaps even product
image are concerned
despite sharply different

Step 2: Market Segmentation
3- Description of Each Group
Once consumers with similar
need nets are identified, they
should be described in terms of
demographics, lifestyles, and
media usage.
In order to design an effective
marketing program, it is
necessary to have a complete
understanding of the potential

Step 2: Market Segmentation
4- Attractive Segment(s) to Serve

Target market - segment(s) of the

larger market on which we will
focus our market effort.
This decision is based on our ability
to provide the selected segment(s)
with superior customer value at a
Each market segment requires its
own marketing strategy.

Step 2: Market Segmentation
Market Segment Attractiveness Worksheet
Step 3: Marketing Strategy
Marketing Strategy is the answer to the question:
How will we provide superior customer value to
our target market?
This requires the formulation of a consistent
marketing mix, which includes the
1. Product
2. Price
3. Communications
4. Distribution, and
5. Services

Step 3: Marketing Strategy
• A product is anything a
consumer acquires or
might acquire to meet a
perceived need.
• Consumers are
generally buying need
satisfaction, not
physical product
Step 3: Marketing Strategy
• Price is the amount of money
one must pay to obtain the right
to use the product.
• Price sometimes serves as a
signal of quality.
• Consumer cost is everything the
consumer must surrender in
order to receive the benefits
of owning/using the product.
Step 3: Marketing Strategy
Marketing communications include advertising, the sales
force, public relations, packaging, and any other signals that
the firm provides about itself and its products.
Step 3: Marketing Strategy

• Distribution means having the

product available where target
customers can buy it.This is
essential to the product’s
• Good channel decisions require a
sound knowledge of where target
customers shop for the product.
Step 3: Marketing Strategy
• Service refers to auxiliary
or peripheral activities that
are performed to enhance
the primary product or
primary service.
• Auxiliary services cost
money to provide, so it is
essential that the firm furnish
only those services that
provide value to the target
Step 4: Consumer Decisions
Consumers Decision Process involves:
1. Problem recognition
2. Information search
3. Evaluation and selection
4. Store choice and purchase
5. Post-purchase processes
Step 4: Consumer Decisions
External Influences
The following are the major
external influences:
• Culture
• Demographics and social stratification
• Ethnic, religious, and regional subcultures
• Families and households
• Groups

Step 4: Consumer Decisions
Internal Influences
Internal influences include:
• Perception
• Learning
• Memory
• Motives
• Personality
Step 4: Consumer Decisions
• The consumer decision process intervenes between the marketing
strategy, as implemented in the marketing mix, and the outcomes.
• The firm can succeed only if consumers see a need that its
product can solve, become aware of the product and its
capabilities, decide that it is the best available solution, proceed to
buy it, and become satisfied with the result of the purchase.
Step 4: Consumer Decisions
Step 5: Outcomes
1. Firm Outcomes

2. Individual Outcomes

3. Society Outcomes
Step 5: Outcomes
Firm Outcomes
• The product position is the image of the product or
brand in the consumer’s mind relative to competing
products and brands.
• Sales are a critical outcome, as they produce the revenue
necessary for the firm to continue in business.
• Customer satisfaction remains a concern for
• Retaining customers requires that they be satisfied
with their purchase and use of the product.
Step 5: Outcomes
Creating Satisfied Customers
Step 5: Outcomes
Individual Outcomes
Need satisfaction
• The most understandable outcome of the consumption
process for an individual, whether or not a purchase is made,
is some level of satisfaction of the need that initiated the
consumption process.
• Injurious consumption, the dark side of consumer
behavior, occurs when individuals or groups make
consumption decisions that have negative consequences
for their long-run well-being.
Step 5: Outcomes
Society Outcomes
• Economic Outcomes
The cumulative impact of consumers’ purchase decisions, including the decision
to forgo consumption, is a major determinant of the state of a given country’s
• Physical Environment Outcomes
Consumers make decisions that have a major impact on the physical
environments of both their own and other societies.
• Social Welfare
Consumer decisions affect the general social welfare of a society, including
having a major impact on the overall quality of life in a society.