Download week1 - comnsumer behavior and research

CONSUMER BEHAVIOR
MKTG 420
Professor Frank Pons
Spring 2005
What is
CONSUMER BEHAVIOR ?
Definition
Consumer behavior reflects the totality of
consumers’ decisions and reactions with respect to
the acquisition, consumption, and disposition of
goods, services, time, and ideas made by decision
making units over time.
Exhibit 1.2: What is Consumer Behavior?
back
Consumer Behaviors??
• Spring Break Trip to Cancun.
• Listening to your favorite band live in a concert hall?
Downloaded on the internet through KAZAA?
• Playing Basket Ball with your University team?
• Adopting a Child from a different country?
• Selling counterfeit products on e-bay?
Consumer
Behavior:
Course
Framework
Consumer Behavior as an
Academic Discipline and an
Applied Science
Factors that contributed to the growing
interest in consumer behavior:
– accelerated rate of new product
–
–
–
–
development
consumer movement
public policy concerns
environmental concerns
the opening of national markets throughout
the world
Who Benefits from the Study
of Consumer Behavior?

Marketing Managers
 Public Policy Makers and
Regulators
 Consumers
Educating Consumers About Cancer
Understanding
consumers’
issues or
problems and
developing
methods to
reach and
educate
consumers
Tums
educates
consumers
about the
importance
of calcium
and
increases
awareness
of its
calcium
content
Marketing’s Impact on Consumers

Marketing and Culture:
– Popular Culture:
 Music, movies, sports, books, celebrities, and other
forms of entertainment consumed by the mass market.
Popular Culture
Companies often create product icons to develop an
identity for their products. Many made-up creatures and
personalities, such as Mr. Clean, the Michelin tire man and
the Pillsbury Doughboy, are widely recognized figures in
popular culture.
Marketing Implications of
Consumer Behavior

Developing a Customer-Oriented Strategy
– How Profitable Is Each Segment?
– What Are the Characteristics of Consumers in
Each Segment?
– Are Customers Satisfied with Existing
Offerings?
Marketing Implications of
Consumer Behavior

Selecting the Target Market
 Positioning
– How Are Competitive Offerings Positioned?
– How Should Our Offerings Be Positioned?
– Should Our Offerings Be Repositioned?
Market Segmentation
Finely-tuned marketing
segmentation strategies
allow marketers to
reach only those
consumers likely to be
interested in buying
their products.
Repositioning
How are you perceived NOW?
How do you WANT to be perceived?
Convenient
Convenient
*
High $
*
Inconvenient
Low $
High $
Low $
Inconvenient
Marketing Implications of
Consumer Behavior

Developing Products or Services
– What Ideas Do Consumers Have for New
–
–
–
–
Products?
What Attributes Can Be Added to or Changed
in an Existing Offering?
What Should Our Offering Be Called?
What Should Our Package and Logo Look
Like?
What About Guarantees?
Marketing Implications of
Consumer Behavior

Making Promotion (Marketing Communications)
Decisions
– What Are Our Advertising Objectives?
– What Should Our Advertising Look Like?
– Where Should Advertising Be Placed?
– When Should We Advertise?
– Has Our Advertising Been Effective
– What About Sales Promotion Objectives and Tactics?
– When Should Sales Promotions Happen?
– Have Our Sales Promotions Been Effective?
– How Many Salespeople Are Needed to Serve Customers?
– How Can Salespeople Best Serve Customers?
Marketing Implications of
Consumer Behavior

Making Pricing Decisions
– What Price Should Be Charged?
– How Sensitive Are Consumers to
Price and Prices Changes?
– When Should Certain
Price Tactics Be Used?
Marketing Implications of
Consumer Behavior
 Making
Distribution Decisions
– Where Are Target Consumers Likely
to Shop?
– How Should Stores Be Designed?
The Underlying Principles of
Consumer Behavior
The Consumer is Sovereign
Consumers are Different;
Consumers are Alike
The Consumer has Rights
Everyone Needs to Understand
Consumers
Challenges for the Future
Gathering and interpreting
information that organizations need
to meet changing needs of
consumers
Developing effective consumer
research methods to capture
changes in trends and lifestyles
Understanding consumer behavior
from a broader perspective as an
important part of life
The Merchants of Cool (Video)

How would you describe the teen market (importance,
characteristics, homogeneous)?

Why do you think some companies in the video (Sprite,
MTV) have been so successful in marketing to teens?

How are culture and marketing related? Which one
influences the other in this video?

Consumer Research represents a key feature in this video.
What types of research are presented in this video? What
kind of information do they provide? How have marketers
use this information.
Consumer
Research
Methodology used to study
consumer behavior.
Definition

The variable is the entity that is studied or that
varies in a research project.

Importance of the RESEARCH QUESTION ?
Primary Versus Secondary Data

Primary Data : Data originating from a researcher
and collected to provide information relevant to a
specific research project.

Secondary Data: Data collected for some other
purpose that is subsequently used in a research
project.
Exhibit 2.5: Who Conducts Consumer Research?
Direct Marketing Association
Consumer Behavior Research
Methods

Surveys
 Focus Groups
 Interviews
 Storytelling
 Use of Photography
and Pictures
Key words: Valid and Reliable

Diaries
 Experiments
 Field Experiments
 Observations
 Purchase Panels
 Database Marketing
Qualitative Versus Quantitative Research

Quantitative studies:
 Many data points (consumers): Quantity of information.
 Statistical Analysis
 Able to Quantify and forecast
 All companies: money saver.

Qualitative studies:
 Few data points (consumers): Quality of information.
 Interpretation: Subjectivity
 Able to Qualify and understand
 Fewer companies: more and more important.
 Beware of underestimation: Importance and Difficulty.
What about Multi-method and Bias?
Ethical Issues in
Consumer Research

The Negative Aspects of Consumer
Research
– Tracking Consumer Behavior in
Different Countries
– Potentially Higher Marketing Costs
– Invasion of Consumer Privacy
– Deceptive Research Practices