Part 1: Introduction
Chapter 1
Consumer Behavior and Marketing Strategy
Dr. Miwa Merz
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Course Content
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Part 1: Introduction
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Part 2: External Influences
Chapter 1: Consumer Behavior and Marketing Strategy
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Part 4: Consumer Decision Process
Chapter 13: Situational Influences
Chapter 2: Cross-Cultural Variations in Consumer
Behavior
Chapter 14: Consumer Decision Process and Problem
Recognition
Chapter 3: The Changing American Society – Values
Chapter 15: Information Search
Chapter 4: The Changing American Society Demographics and Social Stratification
Chapter 16: Alternative Evaluation and Selection
Chapter 5: The Changing American Society - Subcultures
Chapter 6: The American Society - Families and
Households
Chapter 17: Outlet Selection and Purchase
Chapter 18: Postpurchase Processes, Customer Satisfaction,
and Customer Commitment
Chapter 7: Group Influences on Consumer Behavior
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Part 3: Internal Influences
Chapter 8: Perception
Chapter 9: Learning, Memory, and Product Positioning
Chapter 10: Motivation, Personality, and Emotion
Chapter 11: Attitudes and Influencing Attitudes
Chapter 12: Self-Concept and Lifestyle
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The Roadmap for Today’s Class
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The Roadmap for Today’s class
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Discuss what consumer behavior is.
Understand the nature of customer value and the
importance of providing superior customer value.
Understand the overall relationship between
marketing strategy and consumer behavior.
Discuss the factors that affect consumer behavior.
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What is Consumer Behavior?
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Consumer behavior is:
1.) the study of individuals, groups, or organization;
2.) the processes they use to select, secure, use,
and dispose of products (i.e., goods, services,
experiences, or ideas) to satisfy needs and;
3.) the impacts that these processes have on the
consumer and society.
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Why We Study Consumer Behavior?
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Companies need to collect extensive information
about consumers and understand consumer
behavior…but why?
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To make better decisions about marketing strategy
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To influence consumer decisions (e.g., which
product to purchase, which charity to support)
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Understanding Consumers
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1. What consumers think of our products (e.g., goods, services)
and those of our competitors.
2. What consumers think of possible improvements in our
products.
3. How consumers use our products.
4. What attitudes consumers have about our products and our
advertising.
5. What consumers feel about their roles in the family and
society.
6. What consumers’ hopes and dreams are for themselves and
their families.
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Customer Value – Benefits vs. Costs
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Customer value is the difference between all
the benefits derived from a total product and
all the costs of acquiring those benefits.
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A company must consider value from the customer’s
perspective. (Example: Car ownership)
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Customer Value – Benefits vs. Costs (continued)
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Owning a car can provide
consumers with both benefits
and costs!
Benefits: transportation, image,
status, comfort etc.
Costs: gasoline, insurance,
maintenance, car accident, pollution,
traffic jams etc.
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Providing Superior Customer Value
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Providing superior
customer value requires the
organization to do a better
job of anticipating and
reacting to customer needs
than the competitors.
Understand consumer behavior
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Market Analysis Components
Company, Competitors, Conditions, and Consumers
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Company
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Competitors
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Understand the competition’s capabilities and
strategies
Conditions
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Understand its own ability (e.g., financial,
R&D, marketing) to meet customer needs
Understand the state of economy, the
physical environment, government
regulations, technological developments
Consumers
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Understand consumers’ needs and desires
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Market Analysis Components - Conditions
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Advances in technology has changed the way people live,
work, and communicate.
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Market Segmentation
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Identifying product-related need sets.
2. Grouping customers with similar need
sets.
3. Describing each group.
4. Selecting an attractive segment(s) to
serve (i.e., target marketing).
1.
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Why customers choose certain brands/products?
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Customer needs are not restricted to product features but
include:
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Types and sources of information about the product
Outlets where the product is available
The price of the product
Services associated with the product
The image of the product or firm
Where and how the product is produced
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Marketing Strategy
How will we provide superior customer value to our target market?
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Marketing Mix (4Ps)
§ Product
§ Price
§ Place (distribution)
§ Promotion (communication)
v Also includes services provided
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Marketing in Action
Total Product
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What is the Starbuck’s total product?
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Coffee & Tea
Snacks/Sweets
Services
Experience
Products and services are external but experience is
largely internal to each customer.
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Marketing in Action
Total Product (continued)
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What is the AMC theatre’s total product?
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Movies
Food/drinks
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Experience
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Products and services are external but experience is
largely internal to each customer.
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Consumer Decision Process
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1. Problem Recognition
2. Information Search
3. Alternative evaluation
4. Purchase
5. Use
6. (Post-purchase) Evaluation
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Outcomes of Marketing Strategy
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§ Firm Outcomes
• Product position
• Sales and profits
• Customer satisfaction
§ Individual Outcomes
• Need satisfaction (the actual need fulfillment
and the perceived need fulfillment)
• Injurious consumption (e.g., cigarette)
§ Society Outcomes
• Economic outcomes
• Physical environment outcomes
• Social welfare
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Overall Conceptual Model of Consumer Behavior
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External Influences on DecisionMaking Process
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The following are the major external influences:
§ Culture
§ Demographics and social stratification
§ Ethnic, religious, and regional subcultures
§ Families and households
§ Groups
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Internal Influences on DecisionMaking Process
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Internal influences include:
§ Perception
§ Learning
§ Memory
§ Motives
§ Personality
§ Emotions
§ Attitudes
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Self-Concept and Lifestyle
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Self-concept is the totality of an individual’s
thoughts and feelings about oneself.
Lifestyle is how one lives, including the products
one buys, how one uses them, what one thinks
about them, and how one feels about them.
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Homework
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Read Chapter 2, “Cross-Cultural Variations in
Consumer Behavior”
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