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Consumer Behaviour Learning Objectives Comprehend rural consumer’s buying behaviour Know the factors that affect rural consumer’s purchase decision Examine the rural consumer’s lifestyle Develop a generic profile of rural consumer Know the rural consumer’s shopping habits Analyze the rural consumer’s increasing trend towards consumption Consumer behaviour Is a dynamic interaction of affection and cognition, behaviour and the environment by which human beings conduct exchanges during their lives. According to Schiffman and Kanuck “ it’s the behaviour that consumers display in searching for, purchasing, using, evaluating and disposing of products and services that they expect will satisfy their needs. It is a study of how individuals make decisions to spend their available resources like time, money, effort – on consumption related items Who is the rural consumer? Demographics Largely working as farmers or agricultural workers Have limited education, may well be illiterate This leads to linear and simple thinking, abstract logic tends to go over their heads Either live in joint (extended) families or have only recently formed nuclear families Need and Product Hierarchy 5. Self actuali zation needs 4. Esteem needs 3. Social needs 2. productivity needs 1. Basic needs Products and services are basic for living functions. Agricultural implements, pumps, tube wells, bullock cart, fertilizers, house, marriage Products, which improve productivity and minimize disturbances: tractors, harvesters, cycles Products and services that give leisure and pleasure Entertainments, kitchen appliances Products and services which enhance the standard of life and boost: refrigerators, coolers Products and services which help realize life’s dreams (awards) Buyer Behaviour Models Consumer 4Ps Marketing Environment Buyer Buyer Characteristics Decision Process Buyer Decision Marketing Stimuli 4 Ps Product Price Place Promotion Other Stimuli Marketing Environment Economic Technological Political Cultural Buyer characteristics Cultural Social - Reference Groups, Family, Roles and Status Personal - Family Life Cycle, Occupation and Economic circumstances, Lifestyle, Personality and self - concept Psychological - Motivation, Perception, Learning, Beliefs and Attitudes Cultural Personal Age Life style Social •Reference Groups, •Family, •Roles •and Status Psychological • • • • • Motivation, Perception, Learning, Beliefs and Attitudes Shopping behaviour Buy small quantities - more frequently Unit price is critical, particularly as many of them are daily-wage earners Look for ‘acceptable performance’/ functional benefits / paisa vasool paradigm (good in relation to current product) at a reasonable price “Transcreation” of packaging critical Flash price of pack wherever feasible In their own way, good at arriving at a cost per dose (or cost per month) equation: even if not expressed mathematically More sensitive and alert to ‘value’ Make high-volume purchases at weekly village markets Haats Build personal acquaintance with neighborhood retailer Often trust the retailer who does influence brand choice Frequently get ‘credit’ from the retailer Word-of-mouth, very important and credible Mass driven Buy products that are perceived to be popular: the ‘bandwagon’ effect Try to minimise their risk: tend to be stronger creatures of habit High awareness of range of consumer brands Still influenced by popular idols/role models such as movie stars, famous sportsmen, etc Profile of Rural Consumer Traditional Outlook Different Perception and its influence from urban consumer Less Exposure to Marketing Stimuli Conscious for Value for Money Realistic Aspirations Different Concept of Quality Attitude towards prestige products Suspects hype and fear of being cheated Rural consumer’s buying behaviour Rural consumer’s buying behaviour Based on buyer involvement and brands 1.Complex buying behaviour Buying behaviour is complex when products to be bought are expensive and with different brands available in market (like computers, automobiles) 2.Dissonance Reducing Behaviour In case of products like furniture which are expensive but with difference, the consumer is involved because these are more social products. Their style, appearance will be talked. Rural consumer’s buying behaviour 3.Habitual buying behaviour Products like salt and soaps are low cost. The consumer is not really much bothered about which brand he buys. He will ask for the product not the brand. There is a lack of brand consciousness. But there are some exceptions like cigarettes where brand preference is very strong. 4.Variety seeing Consumer prefers to buy different items of same brand or different brands to smell and taste the items. E.g. ice creams, chocolates Rural consumer’s buying behaviour Based on amount of time spent 1. Planned Purchase Behaviour The purchase is budgeted and scheduled in advance 2. Emergency Purchase Behaviour The purchase is made in a hurry to avoid stock-out situations 3. Impulse Purchase Behaviour The purchase is spontaneously, by taking a decision on the spot, without verifying the rationality of the purchase Buying Roles Initiator – one who suggests the idea of buying Influencer – one whose views influence the decision Decider – one who decides to buy or not Buyer –one who makes the actual purchase User – one who consumes or uses the product Eg: Purchasing of Motor cycle: Usually in urban young man initiates, and decides with the influence of friends and colleagues In rural Son –initiator, friends, relatives –influencer, father-decider, son, friends- buyer son and father- user Buying behaviour patterns Urban Rural High Involvement Low Involvement High Involvement Low Involvement High brand differentiation Complex buying Variety seeking (Economy watch) Complex buying Variety seeking Low Brand differentiation Reducing buying behaviour Habitual buying Reducing buying behaviour Habitual buying behaviour Cereals& pulses Medicines Pressure cooker Foot wear Pressure cooker Foot wear Cereals and pulses Medicines Lifestyle of Rural Consumer Rural consumer is very religious Rural consumers prefer to work hard Strong family ties and respect for family values Likes to play cards and hangs out at copal Factors that Influence Rural Consumers while Purchase of a Product Socio-cultural factors Group Family Role and status Sociability Economic Factors Political factors Consumer Decision Process THE CONSUMER DECISION PROCESS Problem Opportunity Recognition •Consumers complete a step-by-step process when making purchase decisions • Search • Alternative Evaluation Purchase Decision Purchase Act Postpurchase Evaluation THE CONSUMER DECISION PROCESS Problem Opportunity Recognition •Consumer becomes aware of a significant discrepancy between the existing situation and the desired situation •Common Causes of Discrepancy: • • • • •What is the marketer’s job? THE CONSUMER DECISION PROCESS •Consumer gathers information Problem related to their attainment of the Opportunity desired state of affairs Recognition •Identifies alternative means of problem solution Search • •Brands that a consumer actually considers buying before making a purchase decision are known as the evoked set •Evoked set evolves constantly THE CONSUMER DECISION PROCESS Problem Opportunity Recognition Search Alternative Evaluation •Consumer evaluates the evoked set • •Outcome of the evaluation stage is the choice of a brand or product (or possibly a decision to renew the search) •Evaluative criteria: •Understanding and influencing consumers evaluative criteria is important in this stage THE CONSUMER DECISION PROCESS Problem Opportunity Recognition •Selection of What and Where • Search Alternative Evaluation Purchase Decision Purchase Act THE CONSUMER DECISION PROCESS •After the purchase, consumers Problem are either satisfied or experience Opportunity post-purchase anxiety Recognition •Post-purchase anxiety that results from an imbalance among Search an individual’s knowledge, beliefs, and attitudes is called cognitive dissonance Alternative •Marketers must try to reduce Evaluation this anxiety Purchase Decision Purchase Act Postpurchase Evaluation Unchanged characteristics of rural consumers Continued existence of an oppressive and rigid caste system, particularly in rural areas The rural consumer normally hails from the lower castes, and therefore any depiction of him/her on an equal footing with the higher castes would be seen as asp rational High illiteracy levels: often incapable of reading or pronouncing a brand name E.g. Lifebuoy is referred to as ‘the red soap’ Key considerations while targeting rural consumers? Targeting rural consumers… Highlight multiple uses from the same product Dettol liquid for cuts, gargle for bad throat, washing clothes as a disinfectant , dandruff etc Jet mosquito coil for mosquito repellent and room freshener Advertise small packs with a low unit price Tiger biscuits tikki pack Cavin Kare - Chik shampoo Chota Pepsi 5 rupiya mein Why pay more? Nirma Super “Jab vohi manghe damo vali quality kam dam mein mile to koi vo kuye le” A little (of the product) goes a long way Rin detergent bar claims that with just a little Rin, you can get a whole lot of wash Using price itself as an indicator of value has some risks attached to it; if used indiscriminately, it can: Down-grade the perceived quality of the product Permanently position the product at that price point making it difficult to effect price increases in the future The rural consumer is sensitive about being portrayed as poor Don’t do it! Play on their aspirations instead Fantasy, Song & Dance, Idiom of the cinema Nirma detergent powder employs song and dance, up-market models and a vibrant jingle Use catch-phrases accompanied by matching signature visuals Surf Ultra detergent powder used the hugely evocative phrase - “Dhoondte reh jaoge” along with the characteristic twirl of the finger Rin detergent bar used the phrase “Zara sa Rin” along with the characteristic flick of the finger Use opinion leaders If they are credible, they work Sunlight detergent powder employs a doctor to endorse the brand Colgate dental cream endorsed by a doctor Sarpanch - Anti Leprosy Leverage the rural consumer’s belief in folklore and natural ingredients Ganga soap claims that it contains milk and is made from the water of Ganga, a river revered as holy by the majority of India’s Hindu population. Dabur Amla hair oil with “Anvla”, Lal Dant Manjan with “lavng” Depict characters and families that are aspirational yet real avoid being too freaky or too Westernised i.e. jeans are OK but torn ones may not be Exploit the warmth of emotion among family members VIP Alpha luggage - man wants to take back the wife when he goes to town to work again Consider leveraging the appeal of mass sports Lifebuoy soap has consistently used mass sports like football Understand and leverage your local culture, beliefs and customs Fair and Lovely skin lightening lotion makes use of people’s belief in palmist Bajaj scooters uses typical vignettes from Indian life to establish an emotional bond with the consumer Brand recognition signals Distinctive colors: use lively, bright colors For toothpaste, avoid using pack colors that have negative connotations - like yellow which connotes dirty teeth Pack Pack is sometimes the only communication medium (logo and visual pack properties) changes in packaging design and/or pack colours while re-launching the brand As the rural consumer tend to come to the shop frequently, POS material should be Durable: tinplates, plastic, sun-resistant inks Functional and reusable: calendars, mirrors, stands Space-efficient Decorative How to select rural media… Rural Communication Planning Framework for selection and evaluation of relevant rural advertising options for a given communication task The framework Outline media possibilities for various marketing situations Construct an evaluation system for various rural options Modify it for relevant state as per regional variations Outline execution pointers Outline costs Marketing Situations Build penetration launch in newer poster Test market Test acceptability of new product/mix Pressure Test vary advertising weights to gauge response Promotion Maintenance But ..budgets are limited. Increase penetration Van Based Advertising Melas Direct to Home Folklore groups Exhibitions/Created events High Reach Low Reach High Frequency Low Frequency Test marketing High Reach Jeep based advertising Wall Painting Bus Stand Bus Panels Haats Hoardings Postal branding Low Reach High Frequency Low Frequency Pressure Test High Reach Low Reach Co-operative Notice Board Shop Front Painting Tin Plating – House Dealer Boards Village Boards Well Tiles Calendars/Labels High Frequency Low Frequency Maintenance High Reach Tin Plating – Trees/Shops Leaflets Posters Banners Streamers/Danglers Low Reach High Frequency Low Frequency Rural media usage grid High Reach Low Reach Jeep based advertising Wall Painting Bus Stand Bus Panels Haats Hoardings Postal branding Van Based Advertising Melas Direct to Home Folklore groups Exhibitions/Created events Co-operative Notice Board Shop Front Painting Tin Plating – House Dealer Boards Village Boards Well Tiles Calendars/Lables Tin Plating – Trees/Shops Leaflets Posters Banners Streamers/Danglers High Frequency Low Frequency Thank you!