Marketing: An Introduction - Chapter 5

Online Social Networks

Online social communities blogs, social networking web sites,and other online communities, where people socialize or exchange information and opinions

E-Procurment

Purchasing through electronic connections between buyers and sellers usually online.

adoption rate (FACTORS INFLUENCING)

RELATIVE ADVANTAGE - degree to which product seems superior to existing products COMPATIBILITY -- degree to which innovation fits values & experiences of potential consumers COMPLEXITY -- degree to which innovation is difficult to understand or use DIVISIBILITY -- degree to which innovation may be tried on a limited basis (with expensive products like HDTV's taking longer to adopt) COMMUNICABILITY---degree to which results of using innovation can be observed or described to others

Social Class

Relatively permanent and ordered division in a society, whose members share similar values, interests and behavior.

Systems Selling (OR Solutions Selling)

Selling a complete solution to a problem, helping buyers to avoid all the separate decisions involved in a complex buying decision

Supplier Development

Systematic development of networks of supplier-partners to ensure an appropriate and dependable supply of products and materials for use in making products or reselling them to others.

Consumer Buyer Behavior

The buyer behavior of final consumers individuals and households that buy goods and services for personal consumption

Business Buyer Behavior

The buying behavior of organizations that buy goods & services for use in the production of other products & services, or for the purpose of reselling or renting them to others at a profit.

Word of Mouth Influence

The impact of the personal words and recommendations of trusted friends, associates, and other consumers on buying behavior.

Adoption Process

The mental process through which an individual passes from first hearing about an innovation to final adoption

Perception

The process by which people select, organize and interpret information to forma meaningful picture of the worlds.

Culture

The set of basic values, perceptions, wants and behaviors learned by a member of society from family and other important institutions.

Personality

The unique psychological characteristics that distinguish a personal group.

Group

Two or more people who interact to accomplish individual or mutual goals.

adoption process (STAGES IN)

(1) AWARENESS--consumer becomes aware of new product, but lacks info about it (2) EVALUATION -- Consumer considers whether trying the new product makes sense (3) TRIAL---Consumer tries the new product on a small scale to improve his estimate of its value (4) ADOPTION---Consumer decides to make full & regular use of product Buyers may pass slowly through these stages, and some stages may be REVERSED (depending on buyer, product, and buying situation)

buyer decision process (CONSUMER)

(1) NEED RECOGNITION---can be triggered by combination of internal stimuli (internal needs on Maslow hierarchy) AND external stimuli (conversations with friends or salespeople, or purchases made by friends) (2) INFORMATION SEARCH---may consult personal sources (family, friends), commercial sources (advertising, salespeople, websites, etc.), public sources (mass media, consumer rating organizations, Internet searches), OR experiential sources (handling, examining, or using the product) (3) EVALUATION OF ALTERNATIVES (4) PURCHASE DECISION --- can be influenced by attitudes of others & unexpected situational factors (5) POST-PURCHASE BEHAVIOR ---can experience cognitive dissonance because of compromises made during purchase decision

buyer behavior (MODEL of)

(1) marketing & other stimuli act on buyer (MARKETING: product, price, place, promotion, OTHER: economic, technological, social, cultural) (2) inputs/stimuli enter BUYER's BLACK BOX, where they're transformed by buyer CHARACTERISTICS & buyer's DECISION PROCESS (3) result of transformation is observable BUYER RESPONSES

Maslow's hierarchy of needs

(1) physiological (hunger, thirst) (2) safety (security, protection) (3) social (sense of belonging, love) (4) esteem (self-esteem, recognition, status) (5) self-actualization (self-development & realization

business buying process (pg 158)

(1) problem recognition (2) general need description (3) product specification(s) (4) supplier search (5) proposal solicitation (6) supplier selection (7) order-routine specification (8) supplier performance review

Modified Rebuy

A business buying situation in which the buy wants to modify product specifications, prices, terms, or suppliers.

New Task

A business buying situation in which the buyer purchases a product or service for the first time

Straight Rebuy

A business buying situation in which the buyer routinely reorders something without any modifications.

Belief

A descriptive thought that a person holds about something

New product

A good, service, or idea that is perceived by some potential customers as new

Subculture

A group of people with shared value systems based on common life experiences and situations.

Motive (Drive)

A need that is sufficiently pressing to direct the person to seek satisfaction of the need.

Opinion Leader

A person with a reference group who, because of special skills, knowledge, personality, or other characteristics, exerts social influence on others.

Attitude

A person's consistently favorable or unfavorable evaluations feelings and tendencies towards an object or idea.

Lifestyle

A person's pattern of living as expressed in his or her activities, interests and opinions.

Consumer Market

All the individuals and households that buy or acquire goods and services for personal consumption

Buying Center

All the individuals and units that play a role in the business-buying decision-making process.

Value Analysis

An approach to cost reduction in which components are studied carefully to determine if they can be redesigned, standardized, or made by less costly methods of production.

Derived Demand

Business demand that ultimately comes from (DERIVES FROM) the demand for consumer goods

Cognitive Dissonance

Buyer discomfort caused by post purchase conflict

buyer responses

Buying attitudes & preferences Purchase behavior (what is bought, when, where, and how much) Brand & company relationship behavior

consumer behavior (FACTORS influencing)

CULTURAL (culture, subculture, social class) SOCIAL (reference groups, family, roles & status) PERSONAL (age & life-cycle stage, occupation, economic situation, lifestyle, personality & self-concept) PSYCHOLOGICAL (motivation, perception, learning, beliefs & attitudes)

Learning

Changes in an individuals behavior arising from experience

business buyer behavior (MODEL OF)

ENVIRONMENT FACTORS ---marketing stimuli & external stimuli (economic, technological political, cultural and competitive) BUYING ORGANIZTION - buying decision process goes on within buying center at organization, influenced by interpersonal and individual influences and organizational influences BUYER RESPONSES - Makes product/service choice, chooses supplier, orders quantities, negotiates delivery terms & times, negotiates service terms, and makes payment

Cross-Cultural Marketing

Including ethnic themes and cross-cultural perspectives within a brands mainstream marketing appealing to consumer similarities across subcultures rather than differences

business & consumer markets (DIFFERENCES BETWEEN)

MARKET STRUCTURE -- far fewer buyers, but buy in much larger quantities DEMAND -- demand is likely to be derived demand NATURE OF BUYING UNIT -- business purchases involve more decision participants, and more professional purchasing effort TYPES OF DECISIONS - business buyers usually face more complex buying decisions than consumer buyers (involve large sums of money, and complex technical, legal & economic considerations) DECISION PROCESS - involves interactions among many levels of the organization, with longer time to make decisions because of complexity involved

social classes

UPPER CLASS (top 1%, the social elite who live on inherited wealth) MIDDLE CLASS (upper-middles: 12%, professionals & independent businesspersons, middle-class: 32%, white & blue-collar workers living on "better side of town") WORKING CLASS (38% - Those who lead a "working-class lifestyle", whatever their income, school, background, or job. Likely to depend heavily on relatives for economic and emotional support and advice) LOWER CLASS (upper-lowers: 9%, the working poor, living just above poverty line, lower-lowers: 7%, visibly poor, often poorly educated, unskilled laborers, often out of work and dependent on public assistance)

adopter categories

innovators (2.5%) early adopters (13.5%) early majority (34%) late majority (34%) laggards (16%)