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Consumer Behavior
Roger D. Blackwell
Paul W. Miniard
James F. Engel
Requests for permission to make copies of any part of the work should be
mailed to the following address:
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Business and Economics
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CHAPTER 1
Consumer Behavior and
Consumer Research
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trademarks used herein under license.
What Is Consumer Behavior?
Activities people undertake when
obtaining, consuming, and
disposing of products and
services
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trademarks used herein under license.
Consumer
Influences
Obtaining
Organizational
Influences
Consuming
Disposing
Consumer Behavior
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trademarks used herein under license.
Consumer
Influences
Organizational
Influences
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trademarks used herein under license.
Consumer
Influences
Culture
Ethnicity
Personality
Family
Life-stage
Values
Income
Available Resources
Attitudes
Opinions
Feelings
Motivations
Past Experiences
Peer Groups
Knowledge
Organizational
Influences
Brand
Product Features
Advertising
Word of Mouth
Promotions
Retail Displays
Price
Quality
Service
Store Ambiance
Convenience
Loyalty Programs
Packaging
Product Availability
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trademarks used herein under license.
Consumer
Influences
Obtaining
Organizational
Influences
Consuming
Disposing
Consumer Behavior
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trademarks used herein under license.
Obtaining
Consuming
Disposing
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trademarks used herein under license.
Obtaining
Consuming
Disposing
How you decide How you use the
you want to buy product
How you get rid of
remaining product
Other products
you consider
buying
How you store the
product in your
home
How much you
throw away after
use
Where you buy
Who uses the
product
If you resell items
yourself or
through a
consignment
store
How you pay for
product
How much you
consume
How you
transport
How product
product home
compares with
expectations
How you recycle
some products
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CONSUMER INFLUENCES
Culture
Ethnicity
Personality
Family
Life-stage
Values
Income
Available Resources
Attitudes
Opinions
Motivations
Past Experiences
Feelings
Peer Groups
Knowledge
OBTAINING
How you decide you
want
to buy
Other products you
consider buying
Where you buy
How you pay for
product
How you transport
product home
ORGANIZATIONAL INFLUENCES
Brand
Product Features
Advertising
Word of Mouth
Promotions
Retail Displays
Price
Quality
Service
Store Ambiance
Convenience Loyalty Programs
Packaging
Product Availability
CONSUMING
How you use the product
How you store the
product
in your home
Who uses the product
How much you consume
How product compares
with
expectations
Consumer Behavior
DISPOSING
How you get rid of
remaining product
How much you throw
away after use
If you resell items
yourself
or through a
consignment
store
How you recycle some
products
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trademarks used herein under license.
What Is Consumer Behavior?
Activities people undertake when
obtaining, consuming, and
disposing of products and
services
A field of study that focuses on
consumer activities
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trademarks used herein under license.
What Is Consumer Behavior?
Activities people undertake when
obtaining, consuming, and
disposing of products and
services
A field of study that focuses on
consumer activities
Scope goes beyond just why and
how people buy to include
consumption analysis
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trademarks used herein under license.
Consumption Analysis
Why and how people use products
in addition to why and how they
buy
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trademarks used herein under license.
The Marketing Concept
The process of planning and
executing the conception, pricing,
promotion, and distribution of
ideas, goods, and services to create
exchanges that satisfy individual
and organizational objectives
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trademarks used herein under license.
The Marketing Concept
The process of planning and
executing the conception, pricing,
promotion, and distribution of
ideas, goods, and services to create
exchanges that satisfy individual
and organizational objectives
Satisfaction with an exchange
depends on satisfaction with
consumption of product and the
exchange of money
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trademarks used herein under license.
Why Study Consumer Behavior?
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trademarks used herein under license.
Why Study Consumer Behavior?
Consumer Behavior Determines the
Economic Health of a Nation
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trademarks used herein under license.
Why Study Consumer Behavior?
Consumer Behavior Determines the
Economic Health of a Nation
Consumer Behavior Determines the
Success of Marketing Programs
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trademarks used herein under license.
Why Study Consumer Behavior?
Consumer Behavior Determines the
Success of Marketing Programs
Marketing can be used to
influence brand choice and
purchase, while Demarketing
can influence people to stop
harmful consumption
“The Customer is King”
Organization influenced by
consumer needs and wants
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trademarks used herein under license.
Why Study Consumer Behavior?
Consumer Behavior Determines the
Success of Marketing Programs
Organizations that are Customercentric use a total marketing approach
to focus their resources on satisfying
customers
Marketing
Process of transforming or changing
an organization to have what people
will buy
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trademarks used herein under license.
Why Study Consumer Behavior?
Consumer Behavior Determines the
Economic Health of a Nation
Consumer Behavior Determines the
Success of Marketing Programs
Consumer Behavior Determines the
Economic Health of Everyone
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trademarks used herein under license.
Why Study Consumer Behavior?
Consumer Behavior Determines the
Economic Health of Everyone
The individual’s decisions as a
consumer determine their economic
health by making more effective
consumption decisions while avoiding
deceptive practices harmful to them
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trademarks used herein under license.
Why Study Consumer Behavior?
Consumer Behavior Determines the
Economic Health of Everyone
Public policy leaders and social
commentators study consumer
behavior to alleviate overconsumption
and underconsumption by educating
consumers about problems and
providing assistance
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trademarks used herein under license.
Educating
Consumers
About
Crises
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trademarks used herein under license.
Educating Consumers About Health
Understanding consumers’ issues or
problems and developing methods to
reach and educate consumers
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trademarks used herein under license.
Educating Consumers About Health
Understanding consumers’ issues or
problems and developing methods to
reach and educate consumers
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trademarks used herein under license.
Why Study Consumer Behavior?
Consumer Behavior Determines the
Economic Health of a Nation
Consumer Behavior Determines the
Success of Marketing Programs
Consumer Behavior Determines the
Economic Health of Everyone
Consumer Behavior Helps
Formulate Public Policy
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trademarks used herein under license.
Helps Formulate Public Policy
Understanding
consumers’
needs to
formulate
public policy
and predicting
behavioral
changes that
follow
Government Protection
and Education
Protection from
Competitive Markets
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trademarks used herein under license.
Why Study Consumer Behavior?
Consumer Behavior Affects
Personal Policy
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trademarks used herein under license.
Why Study Consumer Behavior?
Consumer Behavior Affects
Personal Policy
Personal policy includes how you
behave towards others and in buying
situations, your values and beliefs,
and how you live your life
A person’s economic quality of life is
determined by personal policy
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trademarks used herein under license.
Evolution of Consumer Behavior
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trademarks used herein under license.
Evolution of Consumer Behavior
Supply Chain:
all the organizations involved in taking a
product from inception to final
consumption
- Manufacturers
- Wholesalers
- Retailers
- Facilitating Organizations
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Evolution of Consumer Behavior
Supply Chain:
all the organizations involved in taking a
product from inception to final
consumption
- Manufacturers
- Wholesalers
- Retailers
- Facilitating Organizations
Consumers’ Increased Influence on
Business
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trademarks used herein under license.
Evolution of Consumer Behavior
Wholesaler
Manufacturer
Manufacturing
Orientation
U.S.
Retailer
Consumer
Selling
Marketing Consumer
Orientation Orientation Orientation
1750-1850
1850-WWII
1970-2000
2000+
Europe 1750-1850
1760-WWII
1970-2000
2000+
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Evolution of Consumer Behavior
Consumers’ Increasing Influence
Wholesaler
Manufacturer
Manufacturing
Orientation
U.S.
Retailer
Consumer
Selling
Marketing Consumer
Orientation Orientation Orientation
1750-1850
1850-WWII
1970-2000
2000+
Europe 1750-1850
1760-WWII
1970-2000
2000+
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trademarks used herein under license.
Evolution of Consumer Behavior
Manufacturing Orientation
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trademarks used herein under license.
Evolution of Consumer Behavior
Manufacturing Orientation
Selling Orientation
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trademarks used herein under license.
Evolution of Consumer Behavior
Manufacturing Orientation
Selling Orientation
Marketing Orientation
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trademarks used herein under license.
Evolution of Consumer Behavior
Manufacturing Orientation
Selling Orientation
Marketing Orientation
- Motivation research
- Positivism
- Postmodernism
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trademarks used herein under license.
Evolution of Consumer Behavior
Manufacturing Orientation
Selling Orientation
Marketing Orientation
Consumer Orientation
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Consumer Orientation
Beyond a marketing focus
How all organizations in a demand chain
adapt to changing consumer lifestyles
and behaviors bringing product design,
logistics, manufacturing, and retailing
together
Role of consumers in shaping many
aspects of life—society, government,
social programs, health cares, and other
areas
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trademarks used herein under license.
Consumer Research:
Methods of Studying Consumer
Behavior
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trademarks used herein under license.
Consumer Research Methods
Observation
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trademarks used herein under license.
Consumer Research Methods
Observation
Observing consumer behaviors in
different situations such as natural or
artificial settings
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trademarks used herein under license.
Consumer Research Methods
Observation
In-home observation: examining how and
when consumers use and consume products in
their households
Shadowing: following and observing
consumers in the shopping and consumption
processes. Researchers may ask questions
about reasons for behaviors
Physiological methods: Techniques
borrowed from medicine, psychology and other
sciences including cameras to measure eye
movement, galvanic skin response, and MRI
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trademarks used herein under license.
Consumer Research Methods
Interviews and Surveys
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trademarks used herein under license.
Consumer Research Methods
Interviews and Surveys
Surveys: efficient method for gathering
information from a large sample of consumers
by asking questions and recording responses
(telephone and Internet surveys, mall
intercepts, and mail questionnaires)
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trademarks used herein under license.
Consumer Research Methods
Interviews and Surveys
Surveys: efficient method for gathering
information from a large sample of consumers
by asking questions and recording responses
(telephone and Internet surveys, mall
intercepts, and mail questionnaires)
Focus Groups: a group discussion led by a
moderator skilled in persuading consumers to
thoroughly discuss a topic of interest
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trademarks used herein under license.
Consumer Research Methods
Interviews and Surveys
Surveys: efficient method for gathering
information from a large sample of consumers
by asking questions and recording responses
(telephone and Internet surveys, mall
intercepts, and mail questionnaires)
Focus Groups: a group discussion led by a
moderator skilled in persuading consumers to
thoroughly discuss a topic of interest
Longitudinal Studies: repeated measures of
activities over time to determine changes in
opinions, buying, and consumption behaviors
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trademarks used herein under license.
Consumer Research Methods
Experimentation
Measuring cause-and-effect relationships by manipulating independent
variables to determine the effects of
changes on dependent variables
- Laboratory experiment
- Field experiment
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trademarks used herein under license.
Consumer Research Methods
Experimentation
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trademarks used herein under license.
Consumer Research Methods
Experimentation
Attempts to understand cause-and-effect
relationships by carefully manipulating
independent variables to determine how
these changes affect dependent variables
- Laboratory experiment
- Field experiment
Independent variables might include number
of advertisements and package design
Dependent variables might include purchase
intent or behavior
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trademarks used herein under license.
Consumer Research Methods
Consumption Research
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trademarks used herein under license.
Consumer Research Methods
Consumption Research
Builds on the three primary research
methods to examine how people use
products and services rather than how
they buy them
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trademarks used herein under license.
Understanding How Consumers
Use Products
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trademarks used herein under license.
Consumer Research Methods
Consumption Research
Builds on the three primary research
methods to examine how people use
products and services rather than how
they buy them
May use ethnographic tools to understand how values and culture influence
usage of products and other behaviors
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trademarks used herein under license.
Consumer Research Methods
Consumption Research
Builds on the three primary research
methods to examine how people use
products and services rather than how
they buy them
May use ethnographic tools to understand how values and culture influence
usage of products and other behaviors
May identify new uses for existing
products or new product to satisfy
unmet or changing consumer needs
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trademarks used herein under license.
The Underlying Principles of
Consumer Behavior
The Consumer Is Sovereign
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trademarks used herein under license.
The Underlying Principles of
Consumer Behavior
The Consumer Is Sovereign
The Consumer Is Global
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trademarks used herein under license.
The Underlying Principles of
Consumer Behavior
The Consumer Is Sovereign
The Consumer Is Global
Consumers Are Different;
Consumers Are Alike
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trademarks used herein under license.
Consumers appear different but
respond in similar ways to brands
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trademarks used herein under license.
Consumers appear different but
respond in similar ways to brands
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trademarks used herein under license.
The Underlying Principles of
Consumer Behavior
The Consumer Is Sovereign
The Consumer Is Global
Consumers Are Different;
Consumers Are Alike
The Consumer Has Rights
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trademarks used herein under license.
Consumer Bill of Rights
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trademarks used herein under license.
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
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trademarks used herein under license.
COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are
trademarks used herein under license.
Consumer Behavior
Roger D. Blackwell
Paul W. Miniard
James F. Engel
Requests for permission to make copies of any part of the work should be
mailed to the following address:
Permissions Department, Thomson
Business and Economics
5109 Natorp Boulevard
Mason, OH 45040
800–423–0563
COPYRIGHT © 2006 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are
trademarks used herein under license.
CHAPTER 2
Creating Marketing
Strategies for CustomerCentric Organizations
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trademarks used herein under license.
Consumer Analysis
The process of understanding
consumer trends, global consumer
markets, models to predict
purchase and consumption
patterns, and communication
methods to reach target markets
most effectively
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trademarks used herein under license.
Strategy
A decisive allocation of resources
(capital, technology, and people) in
a particular direction
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trademarks used herein under license.
Customer-Centric Organizations
A strategic commitment to focus
every resource of the firm on
serving and delighting profitable
customers
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trademarks used herein under license.
Characteristics of CustomerCentric Organizations
Shared Vision and Values
Cross-Functional Integration
System-Wide Simultaneous Training
Customer Based Metrics
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Characteristics of CustomerCentric Organizations
Shared Vision and Values
Cross-Functional Integration
System-Wide Simultaneous Training
Customer Based Metrics
The goal of a customer-centric organization
is to provide a consumer with more value
than its competitors
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Value
The difference between what
consumers give up (pay with time,
money, or other resources) for a
product and the benefits they
receive
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Marketing Strategy
Involves the allocation of resources
to develop and sell products or
services that consumers will
perceive to provide more value
than competitive products or
services
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trademarks used herein under license.
Where Does Consumer Behavior
Fit In?
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Marketing Strategy
Involves the allocation of resources
to develop and sell products or
services that consumers will
perceive to provide more value
than competitive products or
services
The process includes market analysis,
market segmentation, brand strategy, and
implementation with the consumer at the
core
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Market Analysis
Consumer
Company
Environmental
Political/Legal
Implementation
in Marketplace
Segmentation
Demographic
Situational
Psychographic
Marketing Mix
Product, Brand,
Price, Place
Promotion, and
7Rs
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trademarks used herein under license.
Market Analysis
The process of analyzing changing
consumer trends, current and
potential competitors, company
strengths and resources, and the
technological, legal, and economic
environments
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trademarks used herein under license.
Market Analysis
The process of analyzing changing
consumer trends, current and
potential competitors, company
strengths and resources, and the
technological, legal, and economic
environments
One goal is to minimize the number
of failed products introduced to the
market by better understanding the
wants and needs of the market
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trademarks used herein under license.
Market Analysis: Consumer
Insight and Product Development
Consumer Insight: an understanding of
consumers’ expressed and unspoken
needs and realities that affect how they
make life, brand, and product choices.
Combines fact (from research) and
intuition to yield an insight that can lead
to a new product, existing product
innovation, brand extension, or revised
communication plan
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trademarks used herein under license.
Market Analysis: Consumer
Environment
Includes demographic trends, personal
and group influences, knowledge,
attitudes, motivation, purchase and
consumption patterns, changing
consumer needs, wants, and lifestyles
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trademarks used herein under license.
Market Analysis: Consumer
Environment
Includes demographic trends, personal
and group influences, knowledge,
attitudes, motivation, purchase and
consumption patterns, changing
consumer needs, wants, and lifestyles
Changes in the consumer environment
can lead to new product ideas, product
adaptations, new packaging or new
services to help consumers meet their
changing needs -iPod Accessories
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trademarks used herein under license.
Market Analysis: Corporate
Strengths and Resources
Resources:
- Financial
- Technological
- Personnel / managerial
- Production
- Development and design
- Research
- Marketing / advertising
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trademarks used herein under license.
Market Analysis: Corporate
Strengths and Resources
Resources:
- Financial
- Technological
- Personnel / managerial
- Production
- Development and design
- Research
- Marketing / advertising
-Proctor and Gamble
once developed
everything internally.
Currently 35% of its
innovations are based
on licensing and
strategic acquisitions
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Market Analysis: Current and
Potential Competitors
- Who are current competitors and which firms
are likely to become competitors?
- What are advantages/disadvantages of
competitors and competitive products?
-What do alternative scenarios show of how
competitors react to new products or
innovations?
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Market Analysis: Market
Environment
State of
Economy
Government
Stability and
Regulations
Market
Environment
Physical
Conditions
Technology
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trademarks used herein under license.
Market Analysis
Consumer
Company
Environmental
Political/Legal
Implementation
in Marketplace
Segmentation
Demographic
Situational
Psychographic
Marketing Mix
Product, Brand,
Price, Place
Promotion, and
7Rs
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trademarks used herein under license.
Market Segmentation
Process of identifying groups of people
who behave in similar ways to each
other, but somewhat differently than
other groups
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trademarks used herein under license.
Inferring Other Behaviors From
Product Usage
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trademarks used herein under license.
Inferring Other Behaviors From
Product Usage
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trademarks used herein under license.
Market Segmentation
Process of identifying groups of people
who behave in similar ways to each
other, but somewhat differently than
other groups
Results in market segment: a group of
consumers with similar behaviors and
needs that differ from those of the
entire mass market
Goal: minimize variance within groups
and maximize variance between groups
Opposite of market aggregation
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trademarks used herein under license.
Market Segmentation
Market aggregation: when organizations
choose to market and sell the same
product or service to all customers
(also known as mass marketing)
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trademarks used herein under license.
Market Segmentation
Identifying Segments
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Market Segmentation
Increasing diversity in consumer needs
and wants leads to mass customization:
customizing goods for individual
customers in high volumes and at
relatively low costs
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trademarks used herein under license.
Market Segmentation
Increasing diversity in consumer needs
and wants leads to mass customization:
customizing goods for individual
customers in high volumes and at
relatively low costs
Key is understanding which customized
features customers value the most
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trademarks used herein under license.
Market Segmentation
Increasing diversity in consumer needs
and wants leads to mass customization:
customizing goods for individual
customers in high volumes and at
relatively low costs
Key is understanding which customized
features customers value the most
Ability to reach “segment of one”
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trademarks used herein under license.
Market Segmentation
Segmentation can increase customer
satisfaction and profitability
- decreases marketing expenses
- increases value (and therefore price) to
consumers
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trademarks used herein under license.
Criteria for Choosing Segments
Measurability: ability to obtain information
about the size, nature, and behavior of a
market segment
Accessibility: degree to which segments
can be reached, either through targeted
advertising and communication programs
or multiple retail channels
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trademarks used herein under license.
Criteria for Choosing Segments
Substantiality: size of the market—is it
large enough to be profitable?
Congruity: how similar members within the
segment exhibit behaviors or
characteristics that correlate with
consumption behavior
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trademarks used herein under license.
Bayesian Analysis
Statistical technique based on a theorem
that expresses uncertainty in probability
terms
Allows consumer analysts to make
“educated guesses” on how the human
mind affects behavior or “why people
buy”
Analyzes data collected from point-ofsale (POS) scanners to identify patterns
of behavior that define market segments
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trademarks used herein under license.
Market Analysis
Consumer
Company
Environmental
Political/Legal
Implementation
in Marketplace
Segmentation
Demographic
Situational
Psychographic
Marketing Mix
Product, Brand,
Price, Place
Promotion, and
7Rs
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trademarks used herein under license.
Market Mix Strategies: Product
Product: the total bundle of utilities (or
benefits) obtained by consumers in the
exchange process
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trademarks used herein under license.
Market Mix Strategies: Product
Product: the total bundle of utilities (or
benefits) obtained by consumers in the
exchange process
Internal considerations
External considerations
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trademarks used herein under license.
Market Mix Strategies: Product
Internal considerations include:
- What are the costs of developing, producing,
distributing, and selling the product?
External considerations include:
- What form of product best serves consumption
patterns for the target segment
- What packaging will most likely attract
consumers and fulfill transportation, usage,
and disposal of the product?
- How will consumers compare this product to
competitive or substitute products?
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trademarks used herein under license.
Market Mix Strategies: Place
Place: physical distribution and location
of sale
- Where will consumers expect and want to buy
this product?
- What are the most effective outlets through
which to sell the product and how best to get it
there?
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trademarks used herein under license.
Market Mix Strategies: Price
Price: total bundle of disutilities (costs)
given up by consumers in exchange for
the product
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trademarks used herein under license.
Market Mix Strategies: Price
Pricing considerations include:
- What is the best pricing policy for the product
or for the store?
- How will consumers react to Everyday Low
Prices or promotional prices?
- Is it more important to have the “lowest price”
or prices in the range consumers expect to
pay?
- What effect does price reduction or price
ending have on perceived quality of product?
- What does pricing policy need to be to
maintain a healthy profit margin?
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trademarks used herein under license.
Market Mix Strategies: Promotion
Promotion: activities involved in selling a
product, including advertising, public
relations, sales promotions, and personal
sales
- What message should be sent to consumers?
- Which forms of communication will best reach
specific segments?
- What type of communication should occur at
various stages of purchase and consumption
- How should different product attributes be
positioned through different forms of media?
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trademarks used herein under license.
Market Mix Strategies: Brand
Brand: A product or product line, store,
or service with an identifiable set of
benefits, wrapped in a recognizable
personality
Functional elements
Emotional elements
Brand Promise
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trademarks used herein under license.
Market Mix Strategies: Brand
Functional elements
- Performance, quality, price, reliability, logistics
Does the brand solve a problem as expected
and do what it is supposed to do?
Emotional elements
- Image, personality, style, evoked feelings
Does the brand create an emotional connections
between the customer and the product or firm?
Brand Promise
What can consumer expect in exchange for their
money?
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trademarks used herein under license.
Market Mix Strategies: Brand
Brand: A product or product line, store or
service with an identifiable set of
benefits, wrapped in a recognizable
personality
Brand Equity
Brand Personality
Brand Protection
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trademarks used herein under license.
Market Mix Strategies: Brand
Brand Equity
Difference in value created by the brand minus
the cost of creating the brand
Brand Personality
Reflection consumers see of themselves or
think will develop by using a brand
Brand Protection
By promising a certain outcome, brands reduce
the risk to consumers that the product may not
deliver as expected
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trademarks used herein under license.
Transforming Customers into
Friends and Fans
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trademarks used herein under license.
Market Analysis
Consumer
Company
Environmental
Political/Legal
Implementation
in Marketplace
Segmentation
Demographic
Situational
Psychographic
Marketing Mix
Product, Brand,
Price, Place
Promotion, and
7Rs
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trademarks used herein under license.
Strategy Implementation
Even the best strategies are worthless if
not implemented well in the marketplace
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trademarks used herein under license.
Strategy Implementation
Even the best strategies are worthless if
not implemented well in the marketplace
7Rs for formulation and implementation
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trademarks used herein under license.
Customer Loyalty and Customer
Relationship Management
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trademarks used herein under license.
Customer Loyalty
It is less costly and easier to keep a
customer than it is to create a new one
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trademarks used herein under license.
Customer Loyalty
It is less costly and easier to keep a
customer than it is to create a new one
Loyal customers generate superior
margins and recruit additional customers
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trademarks used herein under license.
Customer Loyalty
It is less costly and easier to keep a
customer than it is to create a new one
Loyal customers generate superior
margins and recruit additional customers
With increased choices, consumers are
becoming more fickle and less loyal
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trademarks used herein under license.
Customer Loyalty
It is less costly and easier to keep a
customer than it is to create a new one
Loyal customers generate superior
margins and recruit additional customers
With increased choices, consumers are
becoming more fickle and less loyal
Consumer feel entitled to try new brands
and switching behavior increases
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trademarks used herein under license.
Customer Loyalty
It is less costly and easier to keep a
customer than it is to create a new one
Loyal customers generate superior
margins and recruit additional customers
With increased choices, consumers are
becoming more fickle and less loyal
Consumer feel entitled to try new brands
and switching behavior increases
To retain current customers, firms must
focus on customer expectations of future
benefits
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trademarks used herein under license.
Customer Relationship Management
Process of managing all the elements of
the relationship a firm has with its
customers and potential customers with
CRM solutions and enterprise systems
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trademarks used herein under license.
Customer Relationship Management
Implementing CRM
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trademarks used herein under license.
Customer Relationship Management
Implementing CRM
- Identify all customers and the nature of
contacts with them
- Identify which types of customers are most
profitable
- Identify and understand behaviors of the most
profitable customers
- Manage contact with most profitable customers
- Manage firm activities including strategies and
tactics to please the most profitable customers
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trademarks used herein under license.
Customer Relationship Management
Provides the ability to calculate the
Customer Lifetime Value
- The value to the company of a customer over
the whole time the customer relates to the
company
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trademarks used herein under license.
Global Marketing Strategy
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trademarks used herein under license.
Global Marketing Strategy
Thinking Globally: involves ability
to understand markets beyond
one’s own country of origin with
respect to:
Sources of demand
Sources of supply
Management & marketing
methods
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trademarks used herein under license.
Global Marketing Strategy
Organizations must understand
markets on a global basis in terms
of people
Consumers have a myriad array of
foreign-made and globally branded
products
Cultural, ethnic, and motivation
variables also affect consumer
decisions
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trademarks used herein under license.
Global Marketing Strategy
Can marketing be standardized?
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Global Marketing Strategy
Can marketing be standardized?
- Can a firm use the same marketing
program in all target countries, or must
it create a different program for each?
- Which are greater—the similarities
among or differences between
consumers in different countries?
- How do advantages of economies of
scale and unified brand image compare
to advantages of culture-specific
messages?
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Global Marketing Strategy
Cross-Cultural analysis: the comparison
of similarities and differences in behavioral and
physical aspects of cultures
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Global Marketing Strategy
Cross-Cultural analysis: the comparison
of similarities and differences in behavioral and
physical aspects of cultures
Cultural empathy: the ability to
understand the inner logic and coherence of
other ways of life and refrain from judging other
value systems
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trademarks used herein under license.
Global Marketing Strategy
Cross-Cultural analysis: the comparison
of similarities and differences in behavioral and
physical aspects of cultures
Cultural empathy: the ability to
understand the inner logic and coherence of
other ways of life and refrain from judging other
value systems
Ethnography: describing and
understanding consumer behavior by
interviewing and observing consumers in realworld situations
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Global Marketing Strategy
Intermarket segmentation: the
identification of groups of customers who
transcend traditional market or geographic
boundaries (similar segments around the world)
Intermarket segmentation plays a key role in
understanding the similarities and differences
between consumers and countries that become
the foundation of market standardization
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Global Advertising Effectiveness
Global advertising sends the same
message to consumers around the world
Localized campaigns adapt messages to
the norms of the different cultures
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Global Advertising Effectiveness
Global advertising sends the same
message to consumers around the world
Localized campaigns adapt messages to
the norms of the different cultures
When is global advertising most effective?
- Message is based on similar lifestyle
- Ad appeals to basic human needs and
emotions
- Product satisfies universal needs and
desires
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trademarks used herein under license.
Global Advertising Effectiveness
Global advertising sends the same
message to consumers around the world
Localized campaigns adapt messages to
the norms of the different cultures
When is global advertising most effective?
Language problems may occur, but backtranslation, visual language, and local
experts (advice) helps overcome them
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trademarks used herein under license.
Global Advertising Effectiveness
Before choosing a brand name, marketers
should consider the following:
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Global Advertising Effectiveness
Before choosing a brand name, marketers
should consider the following:
- Does the name of the product have another
meaning in one or more of the countries where
it might be marketed?
- Can the name be pronounced everywhere?
- Is the name close to that of a foreign brand, or
does it duplicate another product sold in other
markets?
- If the product is distinctly American, will national
pride and prejudice work against the acceptance
of the product?
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