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College 3
Loyalty and trust important for company and customer.

Types of customers
Individual / family: Business-to-Consumer (B2C)
Organizational buyers: Business-to-Business (B2B)
- Raw materials or machines for production
- Final products for resale
- Supporting products and services

B2B differs from B2C on:

- Demand characteristics Demand comes from things downstream in the chain. If less use is
made of something, it will take a long time before anyone all the way
upstream starts to notice this.
And vice versa if something becomes a trend.
- Order size Orders from BTB are usually larger. BTB
- Number of potential buyers - is smaller, because there are more people than businesses
Buying objectives & criteria - Buyer- Buying
seller relationships
- Decision makers
This must be taken into account in marketing.

Derived demand means that the demand for industrial products and services is driven by, or derived from,
demand for consumer products and services. For example, the demand for Weyerhaeuser's pulp and paper
products is based on consumer demand for newspapers, Domino's "keep warm" pizza-to-go boxes, federal
express packages, and disposable diapers.

Who buys?
Roles:
1. Initiator Need or want which initiates buying process
2. Influencer Influences my decision for example a friend
3. Decider Person with power, authority, die de real decisions maakt
4. Buyer 5. Person who does the shopping
User Uses product

Initiator: sees a need

Influencer: tries to convince others of a certain outcome, usually collects

information

Decision maker: Has formal power and/or financial authority to make decisions

Buyer: Person who carries out the transaction (pick up product, pay, etc.)

In a toy purchase, a girl may be the initiator and attempt to influence her parents, who are the deciders. The girl
may be influenced by her sister to buy a different brand. The buyer may be one of the parents, who visits the store to
purchase the toy and brings it back to the home. Finally, both children may be users of the toy.

=> you want to focus your marketing investments on the influencers within the DMU!

Who is playing what role? Who should we “turn to”

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Buying decision process: individual ÿ Need

recognition How?

ÿ Routine ÿ Ad-
hoc ÿ
Emotional / psychological ÿ Obligatory

Routine: No more coke in the refrigerator, no more gasoline in the car

Ad-hoc: Washing machine breaks down, you drop a vase from your hands

Emotional/psychological: You are bullied at school because of your clothes, you are irritated by your slow computer,
triggered by advertisements!

Conditioning: it is indicated what the reward would be if you were to use a product

ÿ Information search
After discovering the need: search for information
Internal search: remember brand van routine kopen
External search: Infrequent purchases
- Personal sources: they know you and are therefore reliable
- Public sources
- Commercial sources

Which of these sources has the biggest influence on your buying decision process?
- Message adapted to your situation
- Saves search time and money
- Independent, and therefore trustworthy
- Opinion of others important in high risk situation
ÿ In services: experience is key

Internal search: remember brand for routine purchases

External search: for high-value of infrequent purchases

Physical risk: buying of wrong product might cause injury

Financial risk: product might be a waste of money

Functional risk: the product might not function as intended

Psychosocial risk: purchase might prove embarrassing (e.g. clothing, car)

Risk is diminished when more information is sought for, however, this comes at a cost.

Problem solving approach: extended, limited, or routine

Behavioral learning: building a habit of automatic responses to a repeated situation

Cognitive learning: learn through thinking, reasoning and mental problem solving
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3. Evaluation of alternatives

What alternatives are there?

Criteria can fall into technical, economic, social, and personal attributes.

ÿ Purchase

- When to buy/consume it?

- Where to buy/consume it?
- How to buy/consume it?
- How much to buy/consume?
- Servicescape and sound/color psychology

When to buy: purchasing power (economic environment factor)

When to consume: as a marketer you can, for example, promote gingerbread as a snack to sell more
(i.e. by encouraging consumption at other times

Where to buy: Important for the P for Place

Where to consume: as a marketer you can, for example, market different types of beer for home
consumption (no one sees, cheaper type) and for on the terrace (must be trendy)

How to buy: Present at the time of purchase? Or via the Internet? => possibility of additional instructions /
cross-selling

How to consume: e.g. people use different rice when they use it in fried rice than when they eat it as a
stand-alone dish. With the latter, taste is more important.

How much to buy and consume: marketers try to turn light users into heavy users

Where to buy: servicescape

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Color: red and yellow in fast food restaurant

Yellow would make people stay less at your restaurant: yellow is an irritating color. Some fast
food restaurants paint their walls in yellow in order to let people order food and leave (to free more
space for new customers).

Red stimulates a faster heartbeat and breathing and it stimulates appetite.

ÿ Post-purchase evaluation
Are we happy with our purchase? Stories of satisfied and dissatisfied people are very important now
because the story is circulating all over social media, which is why many people see it.
ÿ Satisfied buyers tell others
ÿ Dissatisfied buyers tell:
- the manufacturer
- friends
- a third party
- anybody who wants to hear!

Sometimes cognitive dissonance: maybe other product was the better choice?
ÿ Especially strong with:
- Expensive product
-
Difficult decision
- Irrevocable decision
- Personal anxiety
ÿ People will look for confirmation

It may cost 5 to 10 times as much to attract a new customer than to retain an old one.

Festinger: belief in previously held belief will be reinforced.

Festinger conducted his groundbreaking cognitive dissonance research at the University of

Minnesota. In 1954, Festinger and two colleagues posed as cult members and infiltrated a cult group
to test his cognitive dissonance theory. He had read a newspaper article concerning a Minneapolis
woman that had supposedly received messages from superior alien beings. The aliens had warned
the woman that a great flood would destroy the United States, and bring the end of the world.

Festinger and his confederates successfully assimilated into the cult and regularly attended
meetings. They would however have been surprised to meet little green men! Cognitive
Dissonance Theory predicted that most cult members would not change their belief or opinion about
the woman if the predicted flood did not occur. According to the theory, most cult members
would continue to faithfully believe in the woman, even when she was proven wrong.
That was exactly what happened. Many cult members sold their possessions and quit their jobs in
anticipation of the end of the world.

The majority of cult members remained loyal believers in the woman's prophecy, they grew
stronger in their original belief even when the prophecy did not come true. The thought of they selling
all their posessions was so stupid, that they would have to reinforce their original idea.
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Marketing: Cognitive dissonance: have I made the right choice?

Consumers are satisfied with the benefits of the chosen brand and are glad to avoid the
drawbacks of the brands not bought. However, every purchase involves compromise. Consumers feel
uneasy about acquiring the drawbacks of the chosen brand and about losing the benefits of the brands
not purchased.

- Ignore information and look for positive information about the product (stereo doesn’t
sound good, but looks awesome)

- Distort information (sounds better than the one before)

- Play down importance (as long as it plays the beat, it’s ok)

- Change behavior (sell the stereo and buy something else)

What to do as a firm?

- ads or follow-up calls to assure that they made the right decision => compliment buyer wisdom!

Process dynamics
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Involvement

Marketing goals are different for every situation:

- low involvement: keep product quality constant, prevent stockouts so that buyers do not switch to a competing
product, advertise in a way that confirms the buyer's right choice. For newcomers: try to break habits.

- high involvement: provide as much information as possible

Consumer culture can be broadly defined as a culture where social status, values, and activities are centered on the
consumption of goods and services. In other words, in consumer culture, a large part of what you do, what you value
and how you are defined revolves around your consumption of stuff.

People often fool themselves: for example, buy expensive trousers and then say, they look great on me and they will last a
very long time, so they are worth the money.

SWOT analysis

S strengths
W weaknesses
O opportunities
T threats

Of all 4, choose the 5 most

important ones and this is
one
confrontation matrix
where we go next
can work with.
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Objectives
- Inside-out reasoning:
ÿ For each Opportunity - which strength helps us to take advantage of this, and which weakness
inhibits us from doing so.
ÿ For each Threat - which strength helps us to fight this, and which weakness inhibits us from
doing so.
- Identifying strategic issues -
Choosing/designing strategic options

Process
- Reduction
- Iteration

SWOT confrontation: example