Making Consumer Decisionspehs.psd202.org/documents/rrodrigu/1538662626.pdf · Brand Name vs....
Transcript of Making Consumer Decisionspehs.psd202.org/documents/rrodrigu/1538662626.pdf · Brand Name vs....
Making Consumer Decisions
Chapter 22
In your opinion, what are the pros and cons of brand name and generic products?
Brand Name vs. Generic
Brand Name – word or name on the product that distinguishes it from competitors.◦ Usually in colorful displays or cartoons
◦ Nike swoosh, McDonalds’ Golden Arches
Brand Name vs. Generic
Generic – plainly labeled, unadvertised, and sold at lower prices.◦ Most are either medicines or grocery items
◦ On the average, generic products cost 40 percent less than name-brand products.
Why?
The name main reason is because they are not advertised but are usually the same as brand name.
Which would you buy?
Can you identify the company?
When to buy?
Winter clothes◦ Why?
Summer clothes?◦ Why?
A new car◦ Why?
Where to buy?
Department stores◦ Sell a wide variety of goods
◦ Have different “departments”
◦ Examples
Sears
JC Penny
Discount stores◦ Sell wide variety of goods, but at lower prices
◦ Offer fewer services, but stock a lot of merchandise
◦ Examples
K-Mart, Wal-Mart
Where to buy?
Off-Price & Outlet Stores◦ Brand name products at lower prices
◦ Items may have flaws or defects
◦ Examples
TJ Maxx
Nike Outlet Stores
Limited-Line Retailers◦ Sell large assortment of goods in one type of product
◦ Examples
Foot Locker
Lids
Where to buy?
Superstores/Hypermarkets◦ Sell groceries and department store items
◦ Examples
Super Wal-Marts
Meijer
Warehouse Stores◦ Huge selection of food and non-food items
◦ Sold in bulk
◦ Examples
Sam’s Club
Costco
Where to buy?
Showroom Retailers◦ Samples of products are displayed in a “showroom”
◦ You purchase item, but it is delivered to you at a later date
◦ Examples
American Mattress
Any type of furniture store
Shopping at Home◦ Using Internet, TV, catalogs
◦ Examples
Home Shopping Network
TV Infomercials
Comparison Shopping
Checking the price and quality of a product in more than one store.
Most important when making a major purchase ◦ Examples
car, computer, appliance, television, etc.
Which is the better buy?
Tide Detergent
Powder 33 oz $5.15
Powder 87 oz $11.55
•Unit Price: the cost of an item for a standard unit of
measurement
• per ounce
• per pound
Which is the better buy?
Tide Detergent
Powder 33 oz $5.15 $.1561/oz
Powder 87 oz $11.55 $.1328/oz
www.netgrocer.com
Unit Price
Being a smart consumer
Rational advertising◦ Ad tries to convince you using facts
◦ Mac vs PC
Emotional advertising◦ Ad tries to appeal to your feelings
◦ Nike Training
Being a smart consumer
Read consumer magazines◦ Consumer Reports
Rate products
Shop during sales◦ Can save up to 15%
◦ Promotional sale: give you a special buy on a new product
◦ Clearance sale: sale to clear out goods to make room for new ones
◦ Loss Leaders: advertised products that sell for a loss to bring customers to the store
Wal-Mart is notorious for using loss leaders
Being a smart consumer
Use shopping lists◦ Cuts down on unplanned purchases
◦ Impulse buying: purchasing things on the spur of the moment
Resist pressure from salespeople◦ Free gifts
◦ Adds on like socks, shoes, shoe laces
◦ Added warranty or services
Being a smart consumer
Warranty◦ States rights and responsibilities of the buyer and seller
◦ Full warranty
Good for a stated period of time
90 days, 1 year, 10,000 miles
◦ Limited warranty
Cover only certain parts of a product
What is a target market?
Businesses want to reach a certain group of customers a business ◦ So they decide how to create advertising (commercials, print ads, radio ads, online ads) to aim its marketing efforts and ultimately its merchandise towards.
Target markets are based on:◦ Age
◦ Gender
◦ Interests
◦ What the competition offers
◦ Socioeconomic status