BMGT Ch. 13

Other Factors That Influence Consumer Behavior

Learning: creates changes in an individual's behavior resulting from previous experiences and information Reference group: the group an individual uses as a reference point in forming beliefs, attitudes, values, or behavior. Culture: the set of values, attitudes, and ways of doing things transmitted from one generation to another in a given society. Subculture: the set of values, attitudes, and ways of doing things that results from belonging to a certain ethnic group, racial group, or other group with which one closely identifies (eg. Teenagers) Cognitive dissonance: a type of psychological conflict that can occur after a purchase (wondering if they made the right choice for the right price)

Consumer Decision-Making Process

Problem recognition Information search evaluate alternatives Purchase decision Post-purchase evaluation

Customer Relationship Era (1990-Present)

(CRM) is the process of learning as much as possible about present customers and doing everything you can over time to satisfy them—or even to exceed their expectations. Goal is to establish customer loyalty. Example: airlines have frequent-flier programs and reward loyal customers with free

4 Steps in the Marketing Research Process

1) Defining the question (problem or opportunity) and determining the present situation 2) Collecting research data: primary and secondary data. Secondary data is information that has already been compiled by others and published in journals and books or made available online. Primary data is data that you gather yourself. 3) Analyzing the research data 4) Choosing the best solution and implementing it

3 Parts of the Marketing Concept

1. Customer orientation: find out what consumers want and provide it for them (customer needs) 2. Service orientation: make sure everyone in the organization has the same objective: customer satisfaction 3. Profit orientation: focus on those goods and services that will earn the most profit and enable the organization to survive and expand to serve more consumer wants and needs.

Brand Name

a word, letter, or group of words or letters that differentiates one seller's goods and services from those of competitors

Marketing Concept Era (1950-1990)

after WWII, returning soldiers started new careers and families sparked a tremendous demand for goods and services. Baby boom and consumer-

Consumer Market

all the individuals and organizations that want goods and services to use in producing other goods and services or to sell, rent, or supply goods to others

Business-to-business (B2B) Market

all the individuals and organizations that want goods and services to use in producing other goods and services or to sell, rent, or supply goods to others. (INDUSTRIAL GOODS AND SERVICES)

Promotion

all the techniques sellers use to inform people about and motivate them to buy their products or services

Product

any physical good, service, or idea that satisfies a want or need plus anything that would enhance the product in the eyes of consumers, such as the brand

Concept Testing

asking people, in person or online, whether the idea of a product is appealing for them.

Mass Marketing

developing products and promotions to please large groups of people. (little market segmentation, using mass media to try to sell the same products to as many people as possible)

Geographic Segmentation

dividing a market by cities, counties, or regions

Demographic Segmentation

dividing the market by age, income, and education level

Benefit Segmentation

dividing the market by determining which benefits of the product to talk about

Volume (Usage) Segmentation

dividing the market by usage (volume of use)

Psychographic Segmentation

dividing the market using groups' values, attitudes, and interests

Selling Era (1920-1970)

mass production was achieved, and production capacity often exceeded the immediate market demand. So most companies emphasized selling and advertising in an effort to increase sales.

Middlemen

middle links in a series of organizations that distribute goods from producers to consumers

Target Marketing

selecting which groups or segments an organization can serve profitably

Marketing Research

the analysis of markets to determine opportunities and challenges, and to find the information needed to make good decisions

Production Era (1840-1930)

the general philosophy of business was to produce as much as possible because people will always buy. This philosophy was viable at that time because business owners were mostly farmers, carpenters, and trade workers.

Market Segmentation

the process of dividing the total market into groups whose members have similar characteristics.

Niche Marketing

the process of finding small but profitable market segments and designing or finding products for them

Environmental Scanning

the process of identifying the factors that can affect marketing success

Test Marketing

the process of testing products among potential users

4 P's of Marketing

1. Product: designing a want-satisfying product 2. Price: setting a price for the product 3. Place: putting the product in a place where people will buy it 4. Promotion: promoting the product, including how "green" it is.

One-to-One Marketing

developing a unique mix of goods and services for each individual customer. (travel agencies, rental cars, etc)

Relationship Marketing

lead away from mass production and toward custom-made goods and services. Goal is to keep individual customers overtime by offering them new products that exactly meet their requirements

Factors of B2B Marketing

1. Customers on the B2B market are relatively few 2. Business customers are relatively large; big organizations account for most of the employment and production of various goods and services 3. Tend to be geographically concentrated 4. Business buyers are generally more rational and less emotional than ultimate consumers 5. Sales tend to be direct, but not always. 6. Consumer promotions are based more on advertising, B2B sales are based on personal selling. There are fewer customers and they usually demand more personal service

5 Factors of Environmental Scanning

Global factors: competition, trade agreements, trends, opportunities, internet Technological factors: computers, telecommunications, bar codes, data interchange, internet changes Sociocultural factors: population shifts, values, attitudes, trends Competitive factor: speed, service, price, selection Economic factors: GDP, disposable income, competition, unemployment