Consumers Behavior Consumer Behavior Buying, Having, and Being Sixth Edition By Michael R. Solomon What is Consumer Behavior? Consumer Behavior: The study of the processes involved when individuals or groups select, purchase, use, or dispose of products, services ideas, or experiences to satisfy needs and desires Consumer Behavior is a Process: Exchange: A transaction in which two or more organizations give and receive something of value 1-1 1-2 Some Issues That Arise During Stages in the Consumption Process Consumer Behavior Involves Many Different Actors Consumer: A person who identifies a need or desire, makes a purchase, and then disposes of the product Many people may be involved in this sequence of events. Purchaser / User / Influencer Consumers may take the form of organizations or groups. 1-3 1-4 1
Consumers Impact on Marketing Strategy Market Segmentation: Identifies groups of consumers who are similar to one another in one or more ways and then devises marketing strategies that appeal to one or more groups Demographics: Statistics that measure observable aspects of a population Ex.: Age, Gender, Family Structure, Social Class and Income, Race and Ethnicity, Lifestyle, and Geography What are the segments of these brands??? 1-5 1-6 Consumers Impact on Marketing Strategy (cont.) Relationship Marketing: Building Bonds with Consumers Relationship marketing: The strategic perspective that stresses the long-term, human side of buyer-seller interactions Database marketing: Tracking consumers buying habits very closely, and then crafting products and messages tailored precisely to people s wants and needs based on this information 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. Marketers play a significant role in our view of the world and how we live in it. 1-7 1-8 2
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. 1-9 Meaning of Consumption The Meaning of Consumption: People often buy products not for what they do, but for what they mean. Types of relationships a person may have with a product: Self-concept attachment Nostalgic attachment Interdependence Love 1-10 Meaning of Consumption (cont.) Consumption includes intangible experiences, ideas and services in addition to tangible objects. Global Consumer By 2006, the majority of people on earth will live in urban centers. Sophisticated marketing strategies contribute to a global consumer culture. Even smaller companies look to expand overseas. Globalization has resulted in varied perceptions of the United States (both positive and negative). 1-11 1-12 3
The Global Consumer American products like Levi jeans are in demand around the world. Marketing s Impact on Consumers: Virtual Consumption The Digital Revolution is one of the most significant influences on consumer behavior. Electronic marketing increases convenience by breaking down the barriers of time and location. 1-13 1-14 Blurred Boundaries Marketing and Reality Marketers and consumers coexist in a complicated two-way relationship. It s increasingly difficult for consumers to discern the boundary between the fabricated world and reality. Marketing influences both popular culture and consumer perceptions of reality. Marketing Ethics and Public Policy Business Ethics: Rules of conduct that guide actions in the marketplace The standards against which most people in the culture judge what is right and what is wrong, good or bad Notions of right and wrong differ among people, organizations, and cultures. 1-15 1-16 4
Needs and Wants: Do Marketers Manipulate Consumers? Consumerspace Do marketers create artificial needs? Need: A basic biological motive Want: One way that society has taught us that need can be satisfied Are advertising and marketing necessary? Economics of information perspective: Advertising is an important source of consumer information. Do marketers promise miracles? Advertisers simply don t know enough to manipulate people. Discussion Question This ad was created by the American Association of Advertising Agencies to counter charges that ads create artificial needs. Do you agree with the premise of the ad? Why or why not? 1-17 1-18 Consumerism and Consumer Research Kennedy s Declaration of Consumer Rights (1962) Green Marketing: When a firm chooses to protect or enhance the natural environment as it goes about its activities Reducing wasteful packaging Donations to charity Social Marketing: Using marketing techniques to encourage positive activities (e.g. literacy) and to discourage negative activities (e.g. drunk driving) 1-19 The Wheel of Consumer Behavior Figure 1.3 1-20 5