CHAPTER 4: UNDERSTANDING CUSTOMERS: BUSINESS TO CONSUMER MARKETS Part 2: Use Information to Drive...

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CHAPTER 4:UNDERSTANDING CUSTOMERS: BUSINESS TO CONSUMER MARKETS

Part 2: Use Information to Drive Marketing Decisions

McGraw-Hill Education

Copyright © McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education.

LEARNING OBJECTIVES

Understand the value of knowing the consumer

Consider the role of personal and psychological factors in consumer decision making

Appreciate the critical and complex role of cultural, situational, and social factors in a consumer purchase decision

Understand the consumer decision making process

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THE POWER OF THE CONSUMER

Marketers are interested in learning about the process people use to make purchase decisions.

A company can only deliver value with an accurate and timely understanding of the customer.

Complex forces influence consumer choices and these forces change over time.

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MODEL OF THE CONSUMER DECISION PROCESSEXHIBIT

4.1

Marketing Activities Affect Consumer

Decision Process:Value Proposition

DistributionMarketing Communications

Environmental Forces AffectConsumer Decision Process:

EconomicTechnology

Political

Post-Purchase

Assessment

Search forInformation

ProductChoice

Decision

Evaluationof

AlternativeSolution

Problem Recognition

Internal Forces:Personal

CharacteristicsPsychological

Attributes

External FactorsCultural

SituationalSocial

Personal Characteristics

Life Cycle Stage

Occupation

Lifestyle Gender Roles

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Psychological Attributes

Motivation

Attitude

PerceptionLearning

Personality

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Motivation: The stimulating power that induces and then directs behavior.

Attitude: A learned disposition to respond to an object or class of objects in a consistently favorable or unfavorable way.

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CONTEMPORARY THEORIES OF MOTIVATIONEXHIBIT

4.5

Theory Key ElementsMarketingImplications

Maslow’s Hierarchy of Needs Theory

Humans have wants and needs which influence their behavior. People advance only to the next level if the lower needs are meet.

1. Physiological2. Safety3. Love/Social4. Self Esteem5. Self Actualization

Individuals are not interested in luxuries until they have had basic needs (food, shelter) met

Herzberg’s Two Factor Theory

Certain factors in the workplace result in job satisfaction.

1. Motivators: challenging work, recognition, and responsibility

2. Hygiene factors: status, job security, salary, and benefits

Satisfying hygiene factors does not create a loyal employee or customer. For a company to really create really satisfied employees it is important to focus on motivators

Aldelfer’s ERG Theory

Expansion on Maslow’s Hierarchy placing needs in three categories.

1. Existence2. Relatedness3. Growth

People need a sense of belonging and social interaction. Creating a relationship with the customers extends the customers satisfaction with the product

McClelland’s Achievement Motivation Theory

There are three categories of needs and people differ in the degree in which the various needs influence their behavior

1. Need for Achievement

2. Need for Power3. Need For Affiliation

Companies can be successful targeting one of three basic needs.


PerceptionSelective RetentionSelective DistortionSelective Awareness

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Learning: Any change in the content or organization of long-term memory or behavior. Conditioning creates an association

between two stimuli. Classical conditioning promotes learning

through stimulus and response. Operant conditioning rewards desirable

behavior. Cognitive learning is more active and

requires information to work through problems and life situations.

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Personality Each person has a set of

consistent, enduring personal characteristics.

Those characteristics can be measured to identify differences between individuals.

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Brand personality

Sincerity

Down-to-

Earth, Honest, Wholesome,

Cheerful

Excitement

Daring, Spirite

d, Imaginative, And

Current

Competence

Reliable,

Intelligence, And

Successful

Sophistication

Upper Class And

Charming

Ruggedness

Outdoorsy And Tough

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EXTERNAL FACTORS SHAPE CONSUMER CHOICES

Cultural Factors

Language

ValuesSubcultur

e

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SUBCULTURE GROUPS IN THE UNITED STATESEXHIBIT

4.7

Source: U.S. Census Bureau, www.census.gov, accessed August 4, 2008.


Situational Factors

Physical Surrounding

s

Personal Circumstanc

es

Time

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Social Factors

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Family Household Life Cycle

Social Class

Opinion Leaders

Reference Groups

THE LEVEL OF INVOLVEMENT INFLUENCES THE PROCESS

Involvement activated by A person’s background The aspirational focus Environment at decision-making time

High Involvement Learning People spend time more time in the

decision-making process and report higher satisfaction.

Low Involvement Learning Routine or relatively unimportant decision-

making

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CONSUMER DECISION MAKING PROCESSEXHIBIT

4.10

THE CONSUMER DECISION MAKING PROCESS

Problem Recognition

Real State

Preferred State

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Search for Information

Minimal Information

Search

Limited Information

Search

Extensive Information

Search

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Information Sources

Internal Information Search

External Information Sources

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Defining the Set of Alternatives

Complete Set

Awareness Set

Consideration (Evoked) Set

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Evaluation of

Alternatives

Emotional Choice

Attitude based Choice

Attribute based Choice

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Product Choice DecisionPhysical

Surroundings

Social Circumstances

Time

State of Mind

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Product Choice Decision

What

Where

How Much

When

Payment

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Post Purchase AssessmentDissonance

Use/Non Use

Disposal

SatisfactionDissatisfaction

Instrumental Performance

Symbolic Performance

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Photo Credits

Slide 4-7: Floresco Productions/age fotostock

Slide 4-11: #1 love images/Getty Images; #2 Paul Bradbury/age fotostock

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CHAPTER 4: UNDERSTANDING CUSTOMERS: BUSINESS TO CONSUMER MARKETS Part 2: Use Information to Drive...

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