2:1:0 The buyer decision process
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1 2:1:0 The buyer decision process Module learning objectives: For students to demonstrate an understanding of the process that consumers undertake through the 3 time zones of the buyer decision process. Explain how this process influences the strategies and tactics of marketing practitioners. Activity: Ted goes shopping. Important note to facilitator: This activity is one of the most important activities of the semester. It can also be a bit of fun. I took this photograph in the Strand Arcade in Sydney. The chap is Ted and he is buying a hat for a forthcoming cricket match Australia V India [chose any side that has a friendly rivalry with Australia in cricket Indian students get right into this activity]. The idea is to explore the first time zone of the buyer decision process. A key point is what are Ted s motivations [approach or avoid]. The activity is outlined in the student guide and on the videos. The time allocation is 10 minutes, however, if it is working well allocate some extra time. This activity will save time as it will be a useful reference point when explaining the following model. An old friend has invited Ted to a test cricket match. Many years ago Ted and his friend played on the same cricket team. In recent years, Ted would normally avoid cricket as it involves a great deal of time in the sun; however, as he is keen to renew this friendship he has accepted the invitation. To avoid sunburn Ted has decided to purchase a hat he has entered the buyer decision process. The buyer decision process begins with the recognition of a need what is the need? Is Ted s motivation a mix of approach and avoid factors? Speculate on what reference groups may influence Ted s purchase decision? What is the role of the hat shop in this process? themarketingconcept [student guide] the buyer decision process 1 Dr Stephen Fanning
2 Outline the other factors [scenarios] that may influence Ted s decision. What if the test match is tomorrow and the weather forecast states that the temperature will be 37 o C will there be a sense of urgency and how will that influence the buyer decision process? What if the test match is in 3 weeks - how will that influence the buyer decision process?... How could Ted s ability and willingness to spend influence the buyer decision process? How could Ted s relationship [or lack of relationship] with the hat shop influence the buyer decision process? Ted s purchase of a hat could be described as a consequence of agreeing to attend a cricket match marketing practitioners refer to this as a. product. If Ted purchases a hat and during the test match is complimented on the hat and it keeps the sun of his face and neck will Ted enjoy the event to a greater degree does the hat have an instrumental or terminal value or cold it have both? Then, 2 weeks after the test match Ted is exploring his credit card statement and he notes the cost of the hat. Given the hat has helped him avoid sunburn, has helped him renew an old friendship, has renewed his love of cricket, and he was complimented on his appearance - will Ted be dissatisfied, indifferent, or satisfied with his purchase? If Ted is satisfied with the hat and the recommendations of the hat shop will he be more likely or less likely to shop at the hat shop in the future? themarketingconcept [student guide] the buyer decision process 2 Dr Stephen Fanning
3 Identify the 3 time zones in the above vignette: 3:... Activity: Different people different holidays 1:... 2:... Important note to facilitaors: Also in this class we conduct the activity: Different people different holidays. This activity is employed to sensitise student that there are different market segments and to relate some of the ideas in the e-book to familiar activities. themarketingconcept [student guide] the buyer decision process 3 Dr Stephen Fanning
4 All of the images have been purchased [so this is all speculation] and they have been selected to represent different target market and the purpose of the activity is try to determine a target market and how it differs from other target markets. In the RHS slide there are three groups of people and the takeaway is that $5.00 means different things to students, office workers, or an owner of a Rolls Royce. Students generally like to comment on this slide. There are 6 different groups of travellers in the above images. Given that the photographs were purchased and we nothing about the models. However, let us suppose the following. A: A couple in their early thirties, no children, and have been in this relationship for 6 years, they enjoy traveling, careful how much they spend, although they like meeting people they rarely travel with friends, have a small apartment considering buying a home and starting a family. B: A couple in their late fifties, run their own business, maximum time away two weeks, their children are independent, they like to travel to one new destination each year, avoid family resorts, generally prefer to pay a premium to have all-inclusive drinks and meals package to avoid hassles. C: A group of independent travellers who joined a walking tour in Germany. They are of different ages, their motivation is being outdoors with comfortable accommodation at the end of the day s waling. D: A couple in their early sixties they have children from previous relationships, their children are independent and have moved overseas, They enjoy river and ocean cruises with fine dining and enjoy a glass of fine wine with their meals, they search for epistemic dining experiences. E: A couple with two young children, father a roof carpenter, mother a part-time shop assistant. Their holidays are dictated by the needs of their children, they look for value for money packages, generally holiday within Australia, as one child has asthma and the mother is concerned about the medical facilities overseas. C: Friends from uni. No commitments. Now in full-time work, seeking fun and meeting new people their age with similar interests. Are on a Contiki holiday in the Greek islands. Study the images in the previous slide and present your views on how consumers may vary by age, family lifecycle, interests, disposable income, and values. How do organisations in the tourism industry design and develop products to suit the needs of different consumers? The e-book puts forward the view that marketing practitioners will employ their knowledge of the buyer decision process both strategically and tactically. Explain the strategic and tactical implications. There are four primary factors that influence the 1st time zone of the buyer decision process values1, consumption costs, consumption qualities, and situational factors. In your own words provide an overall description of each. themarketingconcept [student guide] the buyer decision process 4 Dr Stephen Fanning
5 List the three types of values 1 [not the 3 meanings of the word value 1,2,3 ] and provide a brief explanation of each Which of the values 1,2,3 is the most aligned with Maslow s hierarchy of needs? List the types of consumption costs and provide a brief explanation of each List the consumption qualities and provide a brief explanation of each List the situational factors that a consumer would be influenced by and provide a brief explanation of each In your own words discuss the following statement The situational factors [customer, organisation, market, and product] influence every aspect of marketing. How could these factors influence the buyer decision process? themarketingconcept [student guide] the buyer decision process 5 Dr Stephen Fanning
6 ... The picture on the LHS shows three groups of people with different buying power. In your own words discuss the following statement - Consumers vary in their willingness and ability to spend. In your own words explain the following terms and give an example to reinforce the concept: Disposable income: Discretionary income: Buying power: In your own words discuss this statement relating to the customer and the product: the characteristics of the customer, the relationship with the organisation and the nature of the product will determine how quickly a customer progresses through the buyer decision process. In your own words discuss this statement relating to the market and the influence on consumer confidence: The economic conditions could be classified as one of 4 stages prosperity, recession, depression, and recovery. themarketingconcept [student guide] the buyer decision process 6 Dr Stephen Fanning
7 After the recognition of a need consumers search internally and externally for information. Discuss each in your own words and provide examples to reinforce your learning. Why is brand awareness important to an organisation? What is a considered set of products? Explain what is a product attribute and the premise of the multi-attribute model Explain the difference between a determinant and a non-determinant attribute What is meant by estimating the value of alternatives. Why is the word estimating used and not evaluating? themarketingconcept [student guide] the buyer decision process 7 Dr Stephen Fanning
8 Read the following and provide example of each. The general consumer decision-making rules are: Compensatory rule: consumers estimate the attributes of products and calculate a performance attribute score to identify acceptable products. It is referred to as compensatory as consumers will cognitively compensate each product across all the embedded attributes calculate an average across all product attributes Conjunctive rule: rejects products that have any unacceptable product attributes including products that have unacceptable money, time, or effort costs. The disjunctive rule is considering products that have acceptable product attributes Elimination by attribute rule: initially, the consumer lists products that are acceptable across relevant attributes, then estimates the product attributes and removes the products with the lowest performance attribute score until one product stands out Lexicographic rule: consumers will rank products by preference, when two or more products have equal ranking then the consumer searches further to determine the product with the highest overall rating across all attributes plus one determinant attribute Brand affect rule: accepts the brand that is best known and has the highest degree of perceived trust Self-production is often overlooked as a competitor? give an example What reasons may motivate someone to postpone the buyer decision process? What reasons may motivate someone to exit the buyer decision process? themarketingconcept [student guide] the buyer decision process 8 Dr Stephen Fanning
9 Activity: Reducing the risks Activity: The academic literature on risks is considerable and to study it in-depth would be beyond the time we have available. To assist learning and aid recall we have an in-class activity; we select a student to play the role of Adam and another student to play the role of Adam s mum. We ask each to assess the risks associated with backpacking in Europe and then make comparisons between Adam and his mother. Sometimes we have to seek help from aunts and uncles. What is enlightening about this activity is that within a few minutes, readers are able to compile an extensive list of risks [one that spans many years of academic inquiry] and to identify risk management behaviour. In many classes, all the risks listed above are identified. What is interesting about this activity is it demonstrates that students know more about marketing than they realise and how marketing concepts give them templates to analyse consumption activities. Adam has recently graduated from University and is considering, prior to looking for full time employment, backpacking in Europe. He has discussed this with his mother and father his mum sees a number of risks. Adam also sees risks but also sees the benefits many of his friends have backpacked. His mother is anxious, and has discussed her anxiety with Adam s father who also is anxious but stated that he is less anxious than if it was his daughter. Being typical parents, they consider a number of scenarios: What happens if he loses his credit cards? What if he doesn t make friends? What happens if he meets the wrong type of people? What happens if he doesn t visit the best places? What happens if he encounters misery and suffering in the places he visits? What if his beliefs are questioned? Will he miss out on career opportunities? Will he encounter unpleasant conditions? Q: After considering the types of risk Q: What risks do you think Adam s mother is considering? Q: Given that there are risks why do you think people still go backpacking? Make a list of qualities [LHS] and try to align them with risks [RHS] themarketingconcept [student guide] the buyer decision process 9 Dr Stephen Fanning
10 From your own experiences as a consumer outline how consumers may manage risks Vignette: Sally the omni-channel shopper When Sally is shopping for clothes she often searches for information online to narrow her considered set of products before personally visiting the selected stores; she finds that although this practice saves a little money it saves a great deal of time and effort [this practice is often referred to as webrooming]. Sally also shops online at the UK retailer Marks and Spencers. She trusts M&S and is attracted by their returns policy and their free delivery to Australia. Sally will often buy her office clothes from M&S as they are good value and she is less likely to find her colleagues wearing the same outfit. Sally is planning a skiing holiday to Canada and she has been searching online for ski boots, however, she is reluctant to purchase online. She stumbles on a local Perth retailer Mainpeak [they specialise in ski apparel] and during her lunch break she visits the store and tries on a particular ski boot. As she is sitting in the Mainpeak store Sally considers her options: Now that she has the size and brand she could shop online for a cheaper price [this practice is often referred to as showrooming ] Take into consideration the great advice from the salesperson when considering the total price Consider the time, effort, lower risk and the likelihood of a delivery fee when purchasing the ski boots from Mainpeak. Q: Could the urgency of the purchase influence Sally s shopping behaviour? Q: Could the familiarity of the product category influence Sally s shopping behaviour? Q: Could the importance of the product influence Sally s shopping behaviour? Q: Is it likely that Sally may value and seek the advice of the Mainpeak salesperson when considering other purchases for her ski holiday? What is meant by webrooming and showrooming give examples of when you have used both search methods What is the relationship between consumption qualities and risks? Each of the three times zone has a dominant quality [searching experiencing reflecting] discuss each quality Explain what is meant when a marketing practitioner describes a product as high in credence qualities. themarketingconcept [student guide] the buyer decision process 10 Dr Stephen Fanning
11 The product delivery stage may vary in duration give examples where the product delivery stage may be relatively short and other examples where the product delivery stage may take many years. Reflecting on previous material - how would a company operating from a selling philosophy and a marketing philosophy behave differently during the buyer decision process?... Although we have talked about products as having three time zones often they are reborn and have a 2 nd life describe a product that may have a 2 nd life. Explain why it is important for marketers to assist customers through the searching, experiencing, and reflecting processes that are associated with the three-time zones. themarketingconcept [student guide] the buyer decision process 11 Dr Stephen Fanning
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