MARKETING STARTS WITH CUSTOMERS CHAPTER 06 4/27/2017 CHAPTER 6 MARKETING STARTS WITH CUSTOMERS 6-1 Understanding Consumer Behavior 6-2 What Motivates Buyers? 6-3 Influencing Consumer Decisions Chapter 6 MARKETING

Chapter 6 Focus Questions: Is the advertising appealing to children, parents, or both? In what ways? What is appealing about the product that would influence parents to purchase Dimetapp Cold & Allergy rather than another brand of medication? ©WYETH Chapter 6

UNDERSTANDING CONSUMER BEHAVIOR 6-1 UNDERSTANDING CONSUMER BEHAVIOR GOALS Describe the importance of understanding consumer behavior. Demonstrate an understanding of consumers’ wants and needs. Chapter 6

UNDERSTANDING CONSUMER BEHAVIOR 6-1 UNDERSTANDING CONSUMER BEHAVIOR Activity Marketing Matters page 156 3 Things Chapter 6

Consumer Behavior Consumer Behavior: The study of consumers and how they make decisions. Marketing begins with customers Marketers must be responsive to their customers Successful businesses are those that continually consider customers wants and needs Understanding customers is not easy Chapter 6

Consumer Behavior Why it is important to understand consumer behavior Consumer behavior provides insights into why consumers buy certain products and how they use them, which marketers can use in developing a marketing strategy There are 2 types of consumers of interest to marketers Chapter 6

Consumer Behavior Final consumers Business consumers Chapter 6

Consumer Behavior Final Consumer- buy products or services for personal use Someone who enters a store, purchases a product, and uses it Ex. Notebook Chapter 6

Consumer Behavior Business Consumer- buys goods and services to produce and market other goods and services Ex- the manufacturer of the notebook The manufacturer buys the glue, ink, wire and other materials to produce the notebook. Ex- Businesses also buy products that are used in daily operations such as paper, pencils, computers Even though it consumes the products as part of its operations, it is still like a business consumer Chapter 6

Consumer Behavior Activity Come up with 3 products final consumers buy and 3 product business consumers buy…. Difference & similarities between the two? Chapter 6

Consumers’ Wants and Needs All consumers have wants and needs Want- an unfilled desire Pizza, BMW, Vacation, Tickets Need- anything you require to live Nutritious food, a good nights sleep, shelter, air, water Chapter 6

Maslow’s Hierarchy of Needs Abraham Maslow – psychologist identified five areas of needs people have. His work on the motivation theory has helped marketers immensely in their study of needs. Chapter 6

Maslow’s Hierarchy of Needs Self-Actualization (to realize your potential) Esteem (respect and recognition) Social (friends, love, belonging) Security (physical safety and economic security) Physiological (food, sleep, water, shelter, air) Chapter 6

Maslow’s Hierarchy of Needs Chapter 6

6-2 WHAT MOTIVATES BUYERS? GOALS Distinguish the types of buying motives. Describe the five steps of the consumer decision-making process. Chapter 6

Motivation Motivation – is the set of positive and negative factors that direct individual behavior All of our actions are influenced by motivation People have short and long term motivation Short term example- wanting to sleep for a few more hours Long term- Getting an ‘A’ for course over the semester Buying motives- the reason people buy There are 3 categories of buying motives that drive consumers to purchase products Chapter 6

Motivation Emotional motives Rational motives Patronage motives Chapter 6

Motivation Emotional Motives - reasons to purchase based on feelings, beliefs, or attitudes. Forces of love, affection, guilt, fear, or passion often compel consumers to buy Emotional Motives can be very strong EX- Hallmark – encourages you to buy greeting cards, or for an event such as Mothers day, an illness, or a birthday Fear is also an emotional motivator Ex- people buy security systems for their homes or cars Chapter 6

Motivation Rational motives - are reasons to buy based on facts or logic Includes factors such as saving time and money or obtaining the highest quality or greatest value. Ex- expensive things such as a house, car, or college Final Customer vs. Business Customer Chapter 6

Motivation Patronage Motives - based on loyalty Purchase from a particular business or buy a particular brand Loyalty is influenced by positive previous experiences Consumers develop loyalty for many reasons Low prices, high quality, friendly staff, or customer service Chapter 6

The Consumer Decision-Making Process Buying Behavior- is the decision process and actions of consumers as they buy services and products Marketers know it is advantageous to understand the process customers go through when selecting goods or services. Customers go through five steps when making a purchase decision Consumer Decision Making Process – is the process by which customers collect and analyze information to make choices among alternatives Chapter 6

The Consumer Decision-Making Process Postpurchase Evaluation Purchase Alternative Evaluation Information Search Problem Recognition Chapter 6

The Consumer Decision-Making Process Assess Satisfaction The Consumer Decision-Making Process Postpurchase Evaluation Purchase Make a Decision Alternative Evaluation Evaluate Choices Information Search Identify Alternatives Problem Recognition Recognize a Need Chapter 6

INFLUENCING CONSUMER DECISIONS 6-3 INFLUENCING CONSUMER DECISIONS GOALS Describe important influences on the consumer decision-making process. Explain how consumers and businesses use each of the three types of decision making. Chapter 6

Influences on Buying Decisions Knowing what influences a customer’s buying decision is a key part of implementing the marketing concept By understanding what motivates and influences customer purchases, businesses are able to provide the products and services at the right place and time Many internal and external factors influence purchase decisions Two very important factors are individual characteristics and the cultural and social environment Chapter 6

Influences on Buying Decisions Individual characteristics Cultural and social environment Chapter 6

Influences on Buying Decisions Individual characteristics Personal identity is the characteristics and character that make a person unique Important factors that make up personal identity are personality, gender, ethnicity, and age Chapter 6

Individual Characteristics Personality-is an enduring pattern of emotions and behaviors that define an individual The first individual characteristic that influences buying behavior How would you describe your personality? Chapter 6

Individual Characteristics Personalities influence buying decisions because everyone has individual preferences based on attitude, self concept, and lifestyle choices Attitude- a frame of mind developed from a personal values Self concept- an individuals beliefs about his or her identity, image, and capabilities Lifestyle- the way a person lives as reflected by material goods, activities, and relationships Chapter 6

Individual Characteristics Gender – influences many decisions and actions Dress, grooming, social relationships and activities, family roles, and career choices are different for men and women Marketers identify differences in the product and service choice of each gender Chapter 6

Individual Characteristics Ethnicity A set of characteristics uniting a group based on ancestry, a country of origin, language, and traditions is know as ethnicity Some individuals have a strong ethnic identification and demonstrate it in many lifestyle choices including dress, social activities, and food choices, among other factors. Chapter 6

Individual Characteristics Age – has a major influence on consumer behavior. The age of a person generally indicate the types of products and services he/she will be interested in This evidence can easily be seen in television shows, movies, and magazines Chapter 6

Influences on Buying Decisions Cultural and social environment – 2nd important influence on buying decisions Chapter 6

Cultural and Social Environment Culture – is the history, beliefs, customs, and traditions of a group. A group has a strong influence on values and behaviors Traditionally, culture has been defined by the activities, relationships, and institutions shared by a group of people over a generations. Chapter 6

Cultural and Social Environment Some of the strongest influences on individuals choices and behaviors are drawn from a person’s reference groups. Reference group is a group of people or an organization that an individual admires, identifies with, and wants to be part of. Clubs, Social groups or civic organizations Chapter 6

Types of Decision-Making Routine decision making Limited decision making Extensive decision making Chapter 6

Types of Decision-Making Routine decision making - used for purchases that are made frequently and do not require much thought For routine purchases the consumer is familiar with the products available, often chooses the same brand repeatedly, or can make an easy substitution if the usual choice is not available Foods and snacks, personal supplies, and basic necessities are most often purchased using routine decision making Chapter 6

Types of Decision-Making Limited decision making Takes more time than routine decision making Ex. - When you go to the mall and buy a pair of jeans, you might try on several styles, compare prices, and feel the fabric of a few selections before making a final decision You will usually identify and complete a reasonable comparison and evaluate a few alternatives before making a decision Chapter 6

Types of Decision-Making Extensive decision making Occurs when a consumer methodically goes through all 5 steps of the decision making process Normally, it is used with expensive purchases like a car, home, or vacation Consumers spend time and effort evaluating alternatives and arriving at a decision Business use when a purchase has not been made before or when it involves a large investment Chapter 6

Marketers’ Response If the consumer considers alternatives If the consumer is brand loyal Chapter 6