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Dawn Iacobucci
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Preface x
About the author xii
Part 1 Marketing Strategy

Why is Marketing Management Important?
2 Customer Behavior 13
3 Segmentation 32
4 Targeting 51
5 Positioning 63
Part 2 Product Positioning

6 Products: Goods and Services 79
7 Brands 91
8 New Products and Innovation 109
Part 3 Positioning via Price, Place,

and Promotion
9 Pricing 131
10 Channels of Distribution 161
11 Advertising Messages and Marketing Communications 185
12 Integrated Marketing Communications and Media Choices 205
13 Social Media 224
Part 4 Positioning: Assessment Through

the Customer Lens
14 Customer Satisfaction and Customer Relationships 239
15 Marketing Research Tools 256
Part 5 Capstone
16 Marketing Strategy 275
17 Marketing Plans 293
Endnotes 312
Index 316
iii
Preface x
About the author xii
1 Why Is Marketing Management

Important? 1
1-1 Defining Marketing

1-2 Marketing Is an Exchange Relationship
1-2a Marketing is Everywhere 2
1-3 Why Is Marketing Management Important? 2
1-3a Marketing and Customer Satisfaction is
Everyone's Responsibility 4
1-4 The "Marketing Framework": SCs, STP, and the 4Ps 5
1-4a Book Layout 7
1-4b Learning from the Marketing Framework 8
1-4c The Flow in Each Chapter: What? Why? How? 9
2 Customer Behavior 13
2-1 Three Phases of the Purchase Process 13

2-2 Different Kinds of Purchases 15
2-3 The Marketing Science of Customer Behavior 18
2-3a Sensation and Perception 18
2-3b Learning, Memory, and Emotions 20
2-3c Motivation 22
2-3d Attitudes and Decision Making 25
2-3e How Do Cultural Differences Affect
Consumers' Behavior? 27
3 Segmentation 32
3-1 Why Segment? 32

3-2 What Are Market Segments? 33
3-3 What Information Serves as Bases for Segmentation? 35
3-3a Demographic 35
3-3b Geographic 36
3-3c Psychological 37
3-3d Behavioral 39
3-3e B2B 40
3-3f Concept in Action: Segmentation Variables 41
iv
Contents
3-4 How Do Marketers Segment

the Market? 42
3-4a How to Evaluate the
Segmentation Scheme 42
4 Targeting 51
4-1 What Is Targeting and Why

Do Marketers Do It? 51
4-2 How D o We Choose a Segment
to Target? 52
4-2a Profitability and Strategic Fit 52
4-2b Competitive Comparisons 54
4-3 Sizing Markets 56
4-3a Concept in Action: How Much of
My Consultative Advice Can I Sell? 58
5 Positioning 63
5-1 What Is Positioning and Why Is It Probably the Most Important

Aspect of Marketing? 63
5-1 a Positioning via Perceptual Maps 64
5-1 b The Positioning Matrix 66
5-2 Writing a Positioning Statement 74
Part 2 Product Positioning
6 Products: Goods and Services 79
6-1 What Do We mean by Product? 79

6-1 a The Product in the Marketing Exchange 80
6-2 How Are Goods Different from Services? 81
6-2a Intangibility 81
6-2b Search, Experience, Credence 82
6-2c Perishability 83
6-2d Variability 83
6-2e To Infinity and Beyond Goods and Services 84
6-3 What Is the Firm's Core Market Offering? 84
6-3a Dynamic Strategies 86
6-3b Product Lines: Breadth and Depth 87
7 Brands 91
7-1 What Is a Brand? 91
7-1 a Brand Name 92
7-1 b Logos and Color 92
7-2 Why Brand? 93
7-3 What Are Brand Associations? 95
7-3a Brand Personalities 91
7-3b Brand Communities 98
\
Contents
7-4 What Are Branding Strategies? 98

7-4a Umbrella Brands vs. House of Brands 99
7-4b Brand-Extensions and Co-Branding 100
7-4c How are Brands Best Rolled Out Globally? 103
7-4d Store Brands 1 03
7-5 How Is Brand Equity Determined? 104
8 New Products and Innovation 109
8-1 Why Are New Products Important? 1 09

8-2 How Does Marketing Develop New Products for
Their Customers? 110
8-2a Philosophies of Product Development 110
8-2b Marketing 111
8-2c Idea Creation and Market Potential 112
8-2d Concept Testing and Design & Development 113
8-2e Beta-Testing 115
8-2f Launch 116
8-3 What Is the Product Life Cycle? 11 8
8-3a Diffusion of Innovation 120
8-4 How Do New Products and Brand Extensions Fit in
Marketing Strategy? 124
8-4a Strategic Thinking about Growth 125
8-5 What Trends Should I Watch? 126
Part 3 Positioning via Price, Place,

and Promotion
9 Pricing 131
9-1 Why Is Pricing so Important? 1 31

9-2 Background: Supply and Demand 131
9-3 Low Prices 1 36
9-3a Concept in Action: Break-Even for a Good 137
9-3b Concept in Action: Break-Even for a Service 139
9-4 High Prices 142
9-4a Using Scanner Data 142
9-4b Using Survey Data 144
9-4c Conjoint Analysis 144
9-5 Units or Revenue; Volume or Profits 145
9-6 Customers and the Psychology of Pricing 147
9-6a Price Discrimination, a.k.a. Segmentation Pricing 150
9-6b Quantity Discounts 151
9-6c Yield or Demand Management 152
9-7 Non-Linear Pricing 152
9-8 Changes in Cha-Ching 154
9-8a Pricing and the Product Life Cycle 154
9-8b Price Fluctuations 15 5
9-8c Coupons 155
Contents vii
9-8d Competitive Strategy and Game Theory 155

9-8e Auctions 156
10 Channels of.Distribution 161
1 0-1 What Are Distribution Channels, Supply Chain Logistics, and

Why Do We Use Them? 162
1 0-2 How to Design Smart Distribution Systems: Intensive or
Selective? 1 65
1 0-2a Push and Pull 167
1 0-3 Power and Conflict in Channel Relationships 168
10-3a Revenue Sharing 170
10-3b Integration 173
10-3c Retailing 175
10-3d Franchising 178
10-3e E-commerce 179
10-3f Catalog Sales 180
10-3g Sales Force 181
10-3h Integrated Marketing Channels 182
.
11 Advertising Messages and Marketing

Communications 185
1 1 -1 What Is Advertising? 187

1 1 -2 Why Is Advertising Important? 187
1 1 -3 What Marketing Goals Are sought from Advertising
Campaigns? 188
1 1 -4 Designing Advertising Messages to Meet
Marketing and Corporate Goals 1 90
11-4a Cognitive Ads 191
11-4b Emotional Ads 193
11-4c Image Ads 195
11-4d Endorsements 196
1 1 -5 How Is Advertising Evaluated? 198
11-5a A ct and Abranct 201
a
12 Integrated Marketing Communications

and Media Choices 205
1 2-1 What Media Decisions Are Made in Advertising Promotional

Campaigns? 205
12-1a Reach and Frequency and GRPs 207
1 2-1b Media Planning and Scheduling 209
1 2-2 Integrated Marketing Communications Across Media 210
1 2-2a Media Comparisons 212
12-2b Beyond Advertising 214
12-2c Choice Between Advertising and a Sales Force 215
12-2d The IMC Choices Depend on
the Marketing Goals 21 8
1 2-3 How Is the Effectiveness of Advertising
Media Measured? 220
viii Contents
13 Social Media 224
13·1 What Are Social Media? 224

13-1 a Types of Social Media 225
13-1b Word-of-mouth 226
13-2 What Are Social Networks? 227
13-2a Identifying Influentials 227
13-2b Recommendation Systems 228
13-2c Social Media ROI, KPls, and Web Analytics 230
13-2d Pre-purchase: Awareness 230
13-2e Pre-purchase: Brand Consideration 231
13-2f Purchase or Behavioral Engagement 232
13-2g Post-purchase 233
13-2h How to Proceed? 234
Part 4 Positioning: Assessment Through

the Customer Lens
14 Customer Satisfaction
and Customer Relationships 239
14-1 What Are Customer Evaluations, and Why Do We Care? 239

14-2 How Do Consumers Evaluate Products? 240
14-2a Sources of Expectations 241
14-2b Expectation and Experience 243
14-3 How Do Marketers Measure Quality and Customer
Satisfaction? 245
14-4 Loyalty and Customer Relationship Management (CRM) 248
14-4a Recency, Frequency, and
Monetary Value (RFM) 249
14-4b Customer Lifetime Value (CLV ) 251
15 Marketing Research Tools 256

15-1 Why Is Marketing Research
so Important? 256
15-2 Cluster Analysis for Segmentation 258
15-3 Perceptual Mapping for Positioning 260
15-3a Attribute-Based 260
15-4 Focus Groups for Concept Testing 264
15-5 Conjoint for Testing Attributes 265
15-6 Scanner Data for Pricing and Coupon Experiments and Brand
Switching 268
15-7 Surveys for Assessing Customer Satisfaction 270
Contents
Part 4 Capstone
16 MARKET ING ST RATEGY 275

16·1 Types of Business and Marketing Goals 275
16-2 Marketing Strategy 278
16-2a Ansoff's Product-Market Growth Matrix 278
16-2b The BCG Matrix 279
16-2c The General Electric Model 280
16-2d Porter and Strategies 281
16-2e Treacy and Wiersema Strategies 282
16-3 How to "Do" Strategy 283
16-3a SWOT's S&W 284
16-3b SWOT's O&T 285
16-4 Key Marketing Metrics to Facilitate Marketing Strategy 287
17 Marketing Plans 293
17-1 How Do We Put it All Together? 293

17-2 Situation Analysis: The SCs 294
17-3 STP 298
17-4 The 4Ps 300
17-5 Spending Time and Money 304
Endnotes 312
Index 316
There are several really good marketing management texts, yet this text was created because
the Cengage sales force recognized an opportunity. Existing texts present numerous lists of
factors to consider in a marketing decision but offer little guidance on how the factors, lists
and multiple decisions all fit together.
In this book, an overarching Marketing Framework, used in every chapter, shows how
all the pieces fit together. So, for example, when facing a decision about pricing, readers
must consider how pricing will impact a strategic element like positioning or a customer
reaction like loyalty and word of mouth. This book is practical, no-nonsense, and relatively
short, to further heighten its utility. Everyone is busy these days, so it's refreshing when a
writer gets to the point. After this relatively quick read, MBAs and EMBAs should be able
to speak sensibly about marketing issues and contribute to their organizations.
Chapter Org anization

The form of each chapter is very straightforward: The chapter's concept is introduced by
describing what it is and why marketers do it, and the rest of the chapter shows how to do
it well. This what-why-and-how structure is intended to be extremely useful to MBA and
EMBA students, who will quickly understand the basic concepts, e.g., what is segmenta
tion and why is it useful in marketing and business? The details are in the execution, so the
how is the focus of the body of the chapter.
Key Features
Each chapter opens with a managerial checklist of questions that MBA and EMBA stu
dents will be able to answer after reading the chapter. Throughout each chapter, boxes
present brief illustrations of concepts in action in the real world or elaborations on concepts
raised in the text, also drawing examples from the real business world. Chapters close with
a Managerial Recap that highlights the main points of the chapter and reviews the opening
checklist of questions. Chapters are also summarized in outline form, including the key
terms introduced throughout the chapter. There are discussion questions to ponder, as well
as video resources to serve as points for still further discussion. Each chapter contains a
Mini-Case that succinctly illustrates key concepts.
MindTap
The 5th edition of Marketing Management offers two exciting alternative teaching for
mats. Instructors can choose between either a hybrid print and digital offering or a version
that provides completely integrated online delivery through a platform called MindTap.
MindTap is a fully online, highly personalized learning experience built upon authoritative
x
Preface
content. By combining readings, multimedia, activities, and assessments into a singular

Learning Path, MindTap guides students through their course with ease while promoting
engagement. Instructors personalize the Learning Path by customizing Cengage Learning
resources and adding their own content via apps that integrate into the MindTap frame
work seamlessly. Instructors are also able to incorporate the online component of Consumer
Behavior into a traditional Learning Management System (e.g. Blackboard, Canvas, D2L,
etc.) providing a way to manage assignments, quizzes and tests throughout the semester
Instructor Resources
Web resources for the book at www.cengagebrain.com provide the latest information in
marketing management. The Instructor's Manual, Test Bank authored in Cognero, and
PowerPoint slides can be found there.
Acknowledgments
Cengage Learning's people are the best! Special thanks to John Sarantakis (Content
Developer), Mike Roche (Senior Product Manager), Heather Mooney (Product Manager)
Jenny Ziegler (Senior Content Project Manager), Diane Garrity (Intellectual Property An
alyst), Sarah Shainwald (Intellectual Property Project Manager) Laura Cheu (Copyeditor),
Ezhilsolai Periasamy (Project Manager), Manjula Devi Subramanian (Text Researcher),
Abdul Khader (Image Reasearcher), and Pushpa V. Giri (Proofreader).
As always, special thanks to the Cengage sales force. I will forever be grateful for your
notes of encouragement as we began this project. I hope you like Marketing Management 5.
DAWN IA(0 BU ((I is the Ingram Professor of Marketing at the Owen
Graduate School of Management, Vanderbilt University (since 2007). She has
been Senior Associate Dean at Vanderbilt (2008-2010), and a professor of marketing
at Kellogg (Northwestern University, 1987-2004), Arizona (2001-2002), and Wharton
(Pennsylvania, 2004 to 2007). She received her M.S. in Statistics, and M.A. and Ph.D.
in Oliantitative Psychology from the University of Illinois at Urbana-Champaign. Her
research focuses on modeling social networks and geeky high-dimensional analyses. She
has published in Journal of Marketing, journal of Marketing Research, Harvard Business
Review, Journal of Consumer Psychology, International journal of Research in Marketing,
Marketing Science,]ournal ofService Research, Psychometrika, Psychological Bulletin, and Social
Networks. Iacobucci teaches Marketing Management and Marketing Models to Executives,
MBA and undergraduate students and multivariate statistics and methodological topics to
Ph.D. students. She has been editor of both Journal of Consumer Research and journal of
Consumer Psychology. She edited Kellogg on Marketing, she is author of Mediation Analysis,
and co-author on Gilbert Churchill's leading text, Marketing Research.
xii
WHY I S M A R KET I NG 1
M A NAG E MENT I MPO RTANT?
Managerial Checklist
• What are the three phases of the buying process?
•What kinds of purchases are there?
• How do consumers make purchase decisions-and how can marketers use this information?
1 - 1 DEFINING MARKETING
Ask the average person, "What is marketing?" and they might say:
• "Marketing is sales and advertising."
• "Marketers make people buy stuff they don't need and can't afford."
• "Marketers are the people who call you while you're trying to eat dinner."
Unfortunately those comments are probably all deserved. The marketing profession, like
any other, has its issues. But in this book we'll take a more enlightened view.
This chapter begins with an overview of marketing concepts and terms. We' ll see the
importance of marketing in today's.corporation. We'll then present the Marketing Frame
work that structures the book and gives you a systematic way to think about marketing, and
we'll define all the terms in the framework: 5Cs, STP, and 4Ps.
1-2 MARKETING IS AN EXCHANGE

RELATIONSHIP
Marketing is defined as an exchange between a firm and its customers.1 Figure 1.1 shows
the customer wants something from the firm, and the firm wants something from the
customer. Marketers try to figure out what customers want and how to provide it profitably.
Ideally, this can be a nice, symbiotic relationship. Customers don't mind paying for their
purchases-and sometimes they pay a lot-if they really want what they're about to buy.
Companies like taking in profits, of course, but great companies really do care about their
customers. If we're lucky, the exchange depicted in Figure 1.1 is an ongoing exchange be-
tween the customer and the company, strengthening the tie
between them.
As a lifelong customer, you are already somewhat famil
iar with marketing from the consumer side. But on the job,
Marketing oversees the you'll need to understand marketing from the firm's point
customer-brand exchange. of view. Throughout this book, you'll see both perspectives.
In particular, you'll see all the issues that marketers deal
with as they try to deliver something of value to their cus
'
tomers, while trying to derive value from them.
Figure 1.1
Marketing is
an Exchange
1-2a Marketing is Everywhere

Figure 1.2 illustrates that you can market just about anything. Marketing managers sell
simple, tangible goods such as soap or shampoo, as well as high-end luxury goods such as
Chanel handbags. Other marketing managers work in services, such as haircuts, airlines,
hotels, or department stores. Marketers oversee experiences like theme parks or events like
theater and concerts. Marketers help entertainers, athletes, politicians, and other celebrities
with their images in their respective "marketplaces" (fans, agents, intelligentsia, opinion).
Tourist bureaus have marketers who advertise the selling points of their city's or country's
unique features. Information providers use marketing because they want customers to think
they're the best (and thereby maximize their ad revenue). Marketers at nonprofits and gov
ernment agencies work on "causes" (e.g., encouraging organ donation or drinking respon
sibly). Industries market themselves (think of the beef or milk ads). Naturally, companies
use marketing for their brands and themselves. And you can market yourself, e.g., to a job
interviewer or potential amour. These goals may look different, but marketing can be used
beneficially in all these situations.
1-3 WHY IS MARKETING MANAGEMENT

IMPORTANT?
Marketers have evolved beyond being merely product or production focused, where the
company mind-set is, "Let's build a better mouse trap." We know that approach doesn't
work. There's no point in just cranking out better gadgets unless the customers want them
Chapter 1 Why is Marketing Management Important?
Figu1-e 1.2
What Can We
"Market"?
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because the gadgets won't sell. However, there are still pockets of marketing
CUSTOMERS' naivete in a number of industries. For example, some museums believe they
PERSPECTIVE don't need marketing. They think people should appreciate their exhibits, and, if
they don't, it's because the public is ignorant. Perhaps the general public is in
Marketing can seem intuitive
deed relatively unsophisticated culturally, but marketing can be used to educate
because we're all consumers.
But we're not always the target
the public.
customer for the brands we're
We're also more advanced than the old sales-oriented days when the action
building. As a Brand Manager or in the marketplace was, "Let's make a deal." This mentality still exists in plac
CEO, don't forget to put yourself es like drug companies, vyhich push their sales forces to impress physicians. But
in the shoes of your customers usually sales dynamics occur where the product is perceived to be a commodity.
every once in a while, to see In contrast, marketers should be good at communicating product distinctions.
your brand from their As much as direct-to-consumer pharma ads annoy physicians, they attest to the
perspective. When you do, you'll
power of marketing. The ads result in patients asking their doctors for particular
understand their wants and
brand names.
needs better. That alone will
give you an advantage over your
These days we live in a truly customer-oriented and customer-empowered
competitors!
marketing world. Marketing is even said to be evidence of evolved markets-that
an industry or country has moved beyond production and sales and seeks true re
lationships with its customers. Marketers seek to identify their customers' needs
and wants, and they try to formulate attractive solutions. Marketing can make customers
happier, thereby making companies more profitable. Throughout the book, you'll see how.
1-3a Marketing and Customer Satisfaction is

Everyone's Responsibility
Many management gurus believe that marketing has succeeded so well that it isn't just a
"function" in an organization anymore. Marketing is more of a philosophy-a way to think
about business. The marketing orientation should permeate the organization.
•
Accounting and finance need to acknowledge the importance of marketing. Why?
Because their CEOs do. Thinking about customers is unimportant only if you're a
monopoly, and even then, you won't be one for long.
•
Salespeople understand marketing immediately. They're the front line, interfacing
with the customer. They want to push their firm's stuff, but they're thrilled when
their company actually makes stuff that customers want. Then their jobs are so
much easier.
• R&D people tend to understand the marketing spirit, too. They're hired because
they're technically sophisticated, but they get jazzed when their inventions become
popular. It doesn't take much marketing research to test concepts or prototypes and
to veer an R&D path one way or another.
One of the factors stressing marketers these days is the pressure to show results. It's fair
to hold any part of the corporation accountable, and results may be measured for a number
of marketing activities. The Chief Financial Officer (CFO) who wants to see that a recent
coupon promotion lifted sales can get reasonably good estimates from the Chief Marketing
Officer (CMO) about effectiveness, e.g., the percentage sales increase attributable to the
coupon introduction. The Chief Operating Officer (COO) can also get good estimates of
whether a recent direct mail campaign to target customers has been effective in encourag
ing frequent buyers to go directly to the Web for purchasing.
However, it's important not to go overboard in the effort to quantify. For example, how
does one assess the value of a good segmentation study? If segments are poorly defined, any
Marketing
speaks to
customers
wherever they
are.
subsequent marketing efforts would be completely off, so a good segmentation scheme is

invaluable. Advertising is also a little tricky. Non-marketers have the misconception that
advertising is supposed to bump up sales. It can, and that bump is easily measured. But
really great advertising isn't intended for a short-term effect on sales. Great advertising
is intended to enhance brand image, a goal that is relatively longer term and thus more
difficult to measure.
In addition to quantifying the effectiveness of marketing programs, marketers are
motivated to translate their efforts into dollars for another reason: to have a "seat at the
table." Marketers want to make sure that the CMO carries as much weight in the firm
as the CEO or CFO or COO. They all speak finance, so the marketer is frequently mo
tivated to translate progress into financial terms. Fortunately, technology and data are
increasingly enabling more opportunities for the marketer to make such assessments.
For example, a good customer relationship management (CRM) program allows mar
keters to run a field study to assess the impact of a new promotion, and tracking Web
data allows marketers to determine the product combinations that are most attractive
to customers.
1-4 THE "MARKETING FRAMEWORK":

SCS, STP, AN D THE 4PS
Figure 1. 3 provides the marketing management framework. Marketing is captured by
the 5Cs, STP, and the 4Ps. The 5Cs are customer, company, context, collaborators, and
competitors. The 5Cs force a businessperson to systematically frame the general analysis
of the entire business situation. Figure 1. 1 shows that the customer and company are the
central players in the marketing exchange. The context includes the backdrop of macro
environmental factors: How is our economy and that of our suppliers doing? What legal
constraints do we face, and are these changing? What cultural differences do our global
segments manifest? The collaborators and competitors are the companies and people we work
with vs. those we compete against (though drawing the line is sometimes difficult in to
day's interconnected world).
Figure 1.3
Marketing
Management
Framework:
5Cs , STP, 4Ps
STP stands for segmentation, targeting, and positioning. A company or a brand may
want to be all things to all people, but most are not. It's best to identify groups, or segments,
of customers who share similar needs and wants. Once we understand the different seg
ments' preferences, we're in a position to identify the segment we should target with our
marketing efforts. We then begin to develop a relationship with that target segment by
positioning our product to them in the marketplace, via the 4Ps.
The 4 Ps are product, price, promotion, and place. A marketer is responsible for creating
a product (goods or services) that customers need or want, for setting the appropriate price
for the product, for promoting the product via advertising and sales promotions to help
customers understand the product's benefits and value, and finally for making the product
available for purchase in easily accessed places.2
Marketing management oversees the 5Cs, STP, and 4Ps with the goal of enhancing
the marketing exchange (of goods, services, payment, ideas and information, etc.) between
a customer base and a firm. It all sounds easy! Group your customers, and figure out which
group to target. Then create a position in the marketplace by means of the features of the
product, its price, communications and promotions, and distribution choices. Ah, but
don't dismiss marketing as only common sense; after all, consider how few companies do
it well!
If marketing is an exchange, then, just like an interaction between two people, a compa
ny has its best chance at keeping its customers happy if it is in close communication with
them. The company that does its marketing research and really listens to its customers will
be able to deliver goods and services that delight those customers. The best marketers put
themselves in the place of their customers: What are they like? What do they want? How
can we play a role in their lives? In this book, we' ll elaborate on these themes. If you get
overloaded while reading this book, you can step back and remember this: You'll always be
a step ahead of your competition if you simply think about your customers! All marketing
strategy derives from that.
To elaborate on marketing strategy and develop a particular marketing plan, start with a
situation analysis, and sketch answers to the following questions:
•
Customers: Who are they? What are they like? Do we want to draw different
customers?
•
Company: What are our strengths and weaknesses? What customer benefits can we
provide?
•
Context: What is happening in our industry that might reshape our future business?
•
Collaborators: Can we address our customers' needs while strengthening our
business-to-business (B2B) partnerships?
•
Competitors: Who are the competitors we must consider? What are their likely
actions and reactions?
With that background analysis, proceed to strategic marketing planning via STP:
• Segmentation: Customers aren't all the same; find out their various preferences,
needs, and resources.
• Targeting: Pursue the group of customers that makes the most sense for our company.
• Positioning: Communicate our product's benefits clearly to the intended target
customers.
Similarly, marketing tactics to execute the intended positioning derive from a customer
focus:
• Product: Will customers want what our company is prepared to produce?
• Price: Will customers pay what we'd like to charge?
• Place: Where and how will customers purchase our market offering?
• Promotion: What can we tell our customers or do for them to entice them to
purchase?
That doesn't sound too difficult, right? But customers'
preferences change. And the competition is also dynamic;
who they are changes as well as what they offer your cus
tomers. Factors that are out of your control change as well. Good marketing makes any
For example, as marketing manager or CMO, you won't
have control over whether your company is merged with company better!
another whose image seems inconsistent with your brand,
but you'll have to deal with it. Further, the legal environ-
ment in this country is different from that in another's, and
each is always in flux. Many such contingencies call for modifying marketing plans. So the
inputs keep changing. (But if marketing weren't challenging, it wouldn't be as fun!)
As Figure 1. 3 indicates, if we keep an ongoing read on the 5Cs, it will make us better
informed as we approach the STP task. These background indicators will apprise us of which
qualities of a customer base are likely to be relevant as we identify segments. The P of po
sitioning in STP is done via all 4Ps. Thus the 5Cs, STP, and 4Ps operate interdependently.
Optimal business solutions (in real life or in class case discussions) should reflect a working
knowledge of all of these elements, and their connections; as a contextual factor changes,
what is the predicted impact on distribution channels? As a collaborator shifts its demands,
what will that do to our pricing structure? As our company sells off a nonperforming func
tion, what impact might that have on our positioning and customer satisfaction? The plot
thickens!
1-4a Book Layout

Marketing is involved in designing products that customers will enjoy, pricing them ap
propriately, making them available for purchase at easy points of access in the marketplace,
and advertising the products' benefits to customers. Throughout this book, we'll assume
that we're talking about customers all over the world.This internationalism is already true
for most big firms, and it will be true even for small entrepreneurs via the Internet or once
they succeed and grow. We'll also assume the omnipresence of the Internet and always
consider it a factor in data intake or in customer channels of interactions with the company.
In addition to aiming for global citizenship and recognizing the Internet as essential as air,
we will offer fresh, fun examples throughout the book, such as Vegas and Ferrari, instead
·
of laundry detergent.
Ethics: Have a Heart

It is a good thought exercise to consider any dilemma from 2 perspectives:
1) Outcomes
a) An outcome orientation is called consequentialism or teleological ethics (fancy words to impress an interviewer).
b) This perspective believes that"the end justifies the means."
c) As a manager, you'd ask,"What should I do to produce the most good (or the least harm)?"
2) Processes
a) An orientation toward fair process is called deontological ethics.
b) The idea is that the process must be fair, regardless of the outcome that might results.
c) Managers suggest an action as the right one to take according to a principle, such as human rights (e.g.,
fair pay) or environmental sustenance (e.g., green packaging).
Throughout the book, we'll encounter several classes of ethical issues: don't price discriminate, don't target
uninformed groups, don't advertise deceptively, etc.
If you want an additional challenge, assess a scenario from multiple viewpoints. For example, deonto
logically, we might say,"We never price discriminate!"Teleologically, we might say, "To maximize value to our
shareholders, we should charge different prices to different customer segments." See? The plot thickens!
This book will train you to think like a marketer. You'll see that great marketing is not a
soft discipline, it's not an art, nor is it simply intuitive. Great marketing is based on sound,
logical-economic and psychological-laws of human and organizational behavior. You will
learn the scientific and rigorous way to think about marketing issues, so that, in the future,
when your situation looks nothing like the ones you've talked about in school, you'll know
how to proceed in finding your optimal solution. (Hint: Keep the framework close at hand! )
1-4b Learning from the Marketing Framework

There are two key features to how the material is organized in this book. First, MBA
and executive students learning marketing management typically want to see a framework
depicting how all the marketing pieces come together to form the whole picture. To give
you the big picture as well as to provide you with the in-depth details, Figure 1.3 kicks
off every chapter with a Managerial Checklist of questions and issues that the reader can
expect to understand better at the close of the chapter.Those questions are revisited at the
end of the chapter in a list format called Managerial Recap. The chapters are mapped onto
the framework as depicted in Figure 1.4.
You'll become very familiar with this marketing management framework. You will see
the 5Cs, STP, and 4Ps over and over again, so you'll pick them up nearly by osmosis.
We want to make great marketing part of your DNA. You'll know that any marketing
strategy and planning must begin with the 5Cs assessment and then a strategic look at STP,
before turning to the strategies and tactics of the 4Ps.
When you're ...
• Working on a case for class,
• Or trying to answer an interviewer intelligently,
•
Or trying to impress your boss at work,
• Or trying to launch your own business.
Figure 1.4
You'll see the framework in your head. It will remind you of everything that needs to be Chapters
addressed and how all the pieces fit together. The framework will make you process these Mapped to
marketing questions very thoughtfully and systematically. Marketing
Framework
1-4c The Flow in Each Chapter: What? Why? How?
The presentation scheme we've adopted in this book is that each chapter covers the What,
Why, and How. Specifically,
• What is the topic in this chapter?
• Why does it matter?
• How do I do this? Show me what to do so that I can be successful!
Between the marketing framework and the practical flow of the chapters, you'll gain
a strong, clear knowledge of marketing both at the strategic, conceptual level and at the
tactical, hands-on level. Both levels of insight will help ensure your success throughout
your career, whether you're a marketer, a brand manager, an advertising exec, a CMO, or a
well-informed financial analyst, CEO, or world guru.
MANAGERIAL RECAP
Marketing can make customers happier and therefore companies more profitable. Marketing will enhance your career, and marketing can
make the world a better place. Honest!
• Marketing is about trying to find out what customers would like, providing it to them, and doing so profitably.
• Ideally, marketing facilitates a relationship between customers and a company.
• Just about anything can be marketed.
• The overarching marketing management framework-5Cs, STP, 4Ps-will structure the book and help you to think methodically
about the big picture of marketing.
• Don't forget! Stay focused on your customer! If you can remain customer-centric, you'll be five steps ahead of the competition.
10 Part 1 Marketing Strategy
Chapter Outline in Key Terms and Concepts
1. Defining marketing 4. The marketing framework: SCs, STP, and the 4 P s
2. Marketing is an exchange relationship a . Book layout
a. Marketing is everywhere b. Learning from the marketing framework
3. Why is marketing management important? c. The flow in each chapter: What? Why? How?
a. Marketing and customer satisfaction is everyone's 5. Managerial recap

responsibility
Chapter Discussion Questions
1. Before reading this chapter or beginning class, as a customer. What was the essential problem?
what did you expect marketing to be? Ask a family If you ran the company, what would you do to
member, classmate, or coworker what they think ensure happier and more loyal customers?
marketing is. See whether you can persuade them
4. List three brands you1re loyal to. List three things
that marketing enhances a mutually beneficial
you tend to buy on sale. How are the product
exchange between a customer and a company.
categories represented on these two lists different
2. What are examples of brands and companies you for you?
like? Why do you think you like them? What is a
5. What social problem do you think is the world's
brand you can1t stand? Why not?
biggest? Wars? Global warming? Resource imbal
3. Think about a recent time when you bought some ances? How could you start to solve a big social
thing or tried to do so and you were treated poorly problem through marketing?
Video Exercise: Southwest Airlines (13:55)

The Southwest Airlines brand is that of a low-fare carrier with the highest level of customer
service-and with fun added into the flying experience. Southwest Airlines strives to provide
its customers with a total product experience that includes check-in, boarding, flying, and bag-
gage claim experiences. In providing this total product experience, the airline strives to fully meet
the needs, wants, and desires of its customers. Southwest regularly surveys its customers regarding all compo
nents of the product experience in order to foster continuous improvement. Southwest also conducts exten
sive quantitative and qualitative research to better understand customers1 needs, as well as to explore possible
product experiences that the company might offer in the future. Southwest operates on the premise that having
new products is what makes a company successful over time. Thus, while maintaining its commitment to low
fares, excellent customer service, and fun, Southwest seeks to identify product experiences that different market
segments would like to have. The company then builds those experiences into the ticket price structure rather
than charging customers with numerous add-ons. Taking this approach enables Southwest Airlines to better
tailor its total product experience to the wants, needs, and desires of its different market segments.
Chapter 1 Why is Marketing Management Important? 11
Video Discussion Questions
1. Describe the marketing exchange relationship between Southwest Airlines and its customers.
2. Describe the SCs of the marketing framework as they pertain to Southwest Airlines.
3. How does Southwest Airlines' approach to providing a total product experience capture the marketing framework
elements of STP (segmentation, targeting, and positioning) and the 4Ps (product, price, place, and promotion)?
How to Design an Attractive Wearable
A large electronics manufacturer wishes to issue a new "wearable:' The company wants to design it such that it
will make money with the purchase of the unit, of course, but that it will also make money as its customers use
it. In addition, the company would like to capture data about the customers' profiles, in terms of their activities,
spending patterns, etc.
Wearables vary in many ways, and initially, the brand management team proposed to issue a design that looked
like a small smartphone, to be worn on the user's wrist. Given the still relative novelty of such units, they thought
they'd charge on the high end, about $100, maybe even instituting a small annual fee. To get supplementary data,
they thought they'd issue periodic surveys, about once a quarter, via the unit or via e-mail.
The youngest marketer, newest to the team asked, "Well, that's good for us, but how is it attractive to our cus
tomers? Why would they want this unit-when there are plenty of others out there?" One old manager shot out
a withering look. Well, that'll teach the young person to speak up in the meeting. But the senior-most manager
spoke up and said, "Well, you're right, we're only looking at it from our point of view. What would this wearable look
like that our customers would want-and that can be profitable to us?"
What would help these marketers? What steps could they take to design a wearable that would be both opti
mally appealing to its customers (and perhaps attract new customers), as well as optimally profitable?
A wearable could vary on many parameters, such as whether it would be worn on the wrist like a watch, or
as an earbud like music headphones or smartphone speakers, or as an add-on unit to glasses. Early prototypes
suggested that while earbuds or eyeglass designs were good at capturing GP S, they weren't as versatile in sup
porting multiple apps, and they weren't as precise as exercise (step) counters (for example, the head didn't move
as distinctly as the user's wrist while walking). That is what led the brand managers to ask the designers to create
a wrist-wearable.
Even so, there were many possibilities: Should the unit look like a small smartphone or like a nice classic wrist
watch in design? Should the apps be accessed by touch only or should the apps also be voice-activated? Should
there be an annual licensing fee? Should they allow co-branding with affiliations (e.g., a professional sports team
or one's college alma mater)? Which features should be recommended as the unit is designed?
This electronics firm has little experience in marketing research as well, so the older managers were uncertain
as to how to proceed. One mentioned a focus group, another suggested an ethnography, and a third mentioned
surveys. The information that is sought, as well as the method by which the information would be obtained, are
both to be determined. Naturally, the company wants to roll out the new wearable as soon as possible, so while
the research project could be well-funded, they would face time pressure and would have to be judicious in their
choice of research avenues.
Case Discussion Questions
1. Are the old managers right? A lot of other wearables focus on counting steps or enabling apps. ls that what
this group should design, so as to be seen as a legitimate competitor and not confuse customers, or should
they design something different to be seen as innovative?
2. Are the people in the room a good proxy for their customers? Are the young managers a better proxy than
the older managers?
3. What additional information would be helpful to strengthen a recommendation?
4. How would that information best be obtained?

C U STO M E R B EHAV I O R 2
- Managerial Checklist
,
- • What are the three phases of the buying process?
• What kinds of purchases· are there?
• How do consumers make purchase decisions - and how can marketers use this information?
There is some subjectivity in marketing (and in business generally), but there are also many
known, reliable patterns that comprise the science of consumer behavior. Most of this
chapter talks about these effects and how managers can use this knowledge wisely. To pre
pare, we first consider the three major phases that consumers go through when making any
purchase. Next, we'll see the different kinds of purchases that consumers make. Then we'll
drill down and see what makes consumers tick.
2- 1 THREE PHASES OF THE P URCHASE

PROCESS
Customers go through predictable stages in making a purchase. In the pre-purchase phase, the
customer identifies that something is lacking-there is a need or a desire to be satisfied. Crit
ics sometimes say that marketers create desires in people that they didn't already have. There
is some truth in that (e.g., "Is your breath fresh?" " Do you own the coolest running shoes?"),
but even without marketers, people really do need and want all kinds of things. Then the hunt
begins. Buyers search for information about products and brands that may be suitable.
For example, a newly minted MBA student has multiple wants: new clothes, a car, a
condo and furnishings, a list of restaurants in a new city to take clients or visiting friends,
a new dentist, a drycleaner, etc. Such consumers might search for alternative solutions
by going online or asking friends. They might evaluate alternatives by reading Consumer
Reports or going to BizRate.com. By comparison, a newly promoted business executive
might want a corporate jet. Possible vendors would need to be investigated, and alternatives
could be evaluated by soliciting and entertaining bids. While the objects and details of
these two purchases may look different, they both entail a variety of pre-purchase activities.
During the purchase phase itself, the consumer is creating a consideration set that includes
all the brands that are deemed potential candidates for purchase and that excludes the brands
that have been rejected.1 The MBA student may limit the car search to include only hybrids.
I
The condos considered would be only those within a certain price range. The restaurants select
iI ed might be only those with menus that can be previewed online. Analogous considerations
factor into the executive's jet quandary : What attributes are important? What attributes must I
have or not have? What attributes don't I care about and therefore will not pay high prices for?
The final stage is the customer evaluation post-purchase. Buyers assess their purchase
and the purchase process, posing such questions as: Am I satisfied as a customer? Will I buy
this brand again? Will I tell my friends what a great brand I've found? F igure 2.1 shows
the complete process, from seeing that there is a need, to choosing and buying something
expected to be a solution to the need, and finally, to assessing one's satisfaction with that
purchase. For example, imagine running to an interview and the strap on your messenger
bag breaks. You're able to grasp the bag before it hits the ground and possibly shakes up
your tablet. However, obviously you realize you need a new messenger bag. You go online
and order a new bag. When it arrives, you like the looks, the protective inner sleeve for your
tablet, it has a few new features you like, and you had thought the price was pretty reason
able. You're pleased that the bag achieved its mission.
I
F i g u re 2.1
The Purchase
Process • Identify need or want • Narrow "consideration set" • Customer satisfaction
• Search possible solutions • Decide on retail channel • Likelihood to repeat
• Build consideration set • Generate word of mouth
828 Buyi ng Center Roles

In B2B, big, expensive, pu rchases can b e complicated because it's not just one person making the
decision. Each purchase involves a half dozen or so roles in a buying center:
• The Initiator: An administrative assistant who notices that one of the printers in the office is
frequently breaking down.
• The User: Every staff member who tries to use that printe r.
• The Influencer: The IT guy who says, "Well, Brand Xis cheaper, but B rand Y is cooler:'
• The Buyer: The head administ rative person whose responsibilities are to facilitate supplies but
also to answer to . . .
• The Gatekeeper: A conservative accountant type whose job it is to tighten purse strings.
A decision to buy a new p rinter is complicated by the fact that each of these roles seeks slightly different
attributes. Some care only a bout price, others want great features, and still others may appreciate
wiggle room in negotiating delivery dates or follow-up custome r se rvice.
Chapter 2 Customer Behavior
The buying process is consistent whether the buyer is a consumer or a business. Con
sumer buying is easy to relate to. It involves people buying something for themselves or
their households, and we are those people. A business customer is an agent buying some
thing on behalf of an organization. The agent can be an administrative assistant deciding
to use UPS or FedEx, or the agent can be a group of people, representing different aspects
of the organization (accounting, operations, etc.), comprising a collective buying center.
All purchases, business-to-consumer (B2C) or business-to-business (B2B), go through the
three stages, but the amount of time spent in any stage depends in part on what is being
bought. For example, sometimes the pre-purchase phase is extensive, and sometimes it is
very quick. So let's consider some classes of purchases.2
2-2 D I F FE RENT KIN D S O F PU RC HA SE S

Marketers distinguish between types of purchases. For consumers, a convenience item is a
fairly mindless purchase of "staples" (standard, frequently-consumed goods, such as bread
or gas) or an impulse purchase (such as candy or magazines that are available near grocery
checkouts). There are also shopping purchases, which require some thought or planning, as
when using OpenTable to find a restaurant before heading out of town. Finally, there are
specialty purchases such as a car or new laptop. These purchases are occasional, they are of
ten more expensive than other types of purchases, and as a result they require more thought.
For B2B customers, the terms are different from consumer buying, but the ideas are
analogous. A purchase can be a straight rebuy, such as when the office copier needs toner
and the office manager buys the usual brand. Another purchase may be a modified rebuy,
such as when the copier lease comes up and there is a desire to consider a different vendor.
Last, there is the new buy. For example, perhaps the company is considering buying tele
conferencing equipment for the first time, and it is not yet well-understood what attributes
to consider.
As Figure 2.2 indicates, what differentiates these purchases is not the product itself The
distinction is more in the minds of the customers and in their involvement with the brand
and product category. For example, the purchase of the same product-an energy drink
can be convenience when shoppers mindlessly put their usual brand in their grocery cart; it
can be a shopping purchase when customers see a new offering that they consider trying;
and it can be a specialty purchase when customers see an expensive brand that promises
antioxidants, which they choose to read up on before making a purchase.
-+---- Customer Involvement �

Fig u re 2.2
Low Medium High Types of
Purchases in
82C . Convenience Shopping Specialty B2C&B2B Isa
Matter of
828 Straight rebuy Modified reb'-!Y · New buy Customer
Involvement
"Add to Cart"
Action Needs some Needs research
or "Click to buy"
thought and serious thought
Consumers purchase convenience items-or business customers a straight rebuy-in

a fairly mindless manner. It's the proverbial no-brainer. Buyers won't spend much time
thinking about brands or attributes because they just don't care enough to do so. The chal
lenge for marketers is to break that thought pattern (not that it's very thoughtful!)-to
shake up the consumer with news of their brand and break through that white noise clutter.
For items that customers care more about, they' ll expend some time and effort prior to
the purchase, seeking out more information to be a smart shopper and to obtain good value.
For even higher customer involvement, as in specialty purchases or new buys, the customers
are more engaged. A great deal of effort is put into researching the best brands, quality, and
price. The marketer's challenge is to convince the buyer that their brand is the best choice.
Types of 828 Customers

B2B customers are often classified according to what they sell:
• Installations (e.g., equipment for new factories)

• Accessories (e.g., computers to help run the office)
• Raw materials (e.g., lumber, plastics)
• Components (processed items that are components in a later finished product)
• Business services (e.g., insurance, legal, consulting)
Ultimately, the most important classification is how much the buying business cares a bout the
purchase. Then we'll know whether they care primarily about quality or price.
The category that a brand and target segment is in will suggest the appropriate
marketing activities that we'll select from in the chapters that follow. For example, for
lower-involvement purchases, we can expect customers to be somewhat more price sensitive.
They'll pay more when they buy things they really like or want (e.g., a cool laptop) or that
they expect to be of high quality (e.g., a great restaurant) or that is important to them (e.g.,
health care for their parents).
Consider the implications for loyalty programs. The marketer can create such programs
regardless of the level of customer engagement, but they'd take different forms, e.g., price
discounts for low-involvement purchases vs. brand communities and events for high-in
volvement products and brands. Customer satisfaction can be fine for low-involvement
purchases, but customers won't generate word of mouth; they don't care enough. In contrast,
for high-involvement purchases, strong followers and satisfied customers can be zealots and
brand ambassadors.
Consider the implications for channels of distribution. Low-involvement products need
to be widely available so that the customer can pick them up without thinking. High
involvement products will be sought out by more customer
' activity.
Finally, consider the implications for promotions. For
low-involvement products, the marketer just hopes to cut
Marketing satisfies (and creates)
through the noise and clutter-getting customers' attention
consumers' needs and wants. only long enough to register the brand name in the mind of
the customer for sheer familiarity. With high-involvement
purchases, customers are hungry for information, and mar
keters can provide much more.
,
So how do customers learn about brands and make choices? In the rest of the chapter,
we'll look at how customers think and how marketing can have an impact on their deci
sions and choices.
2-3 T HE MARKET ING SC IENCE O F CUSTOMER

BE HAVI O R
Consumers are human beings and, as such, are sometimes simple and predictable, but often
rather complex. In this section, we'll delve into consumer psychology, examining sensation
and perception, learning and memory, motivation, attitudes, and decision making.
2-3a Sensation and Perception

When marketers formulate positioning statements or produce perceptual maps, they
presuppose a complicated system through which consumers sense and perceive their
environment. An enormous wave of sensory stimulation washes over and through us every
day. We are selective in our attention, choosing to consider certain stimuli and effectively
screening out others. For example, if we are in the market for a car, we'll watch TV ads for
cars. If we're not in the market for a car, we barely "see" the TV ads for cars. We know that
consumer involvement creates a state of heightened motivation to learn more about a pur
chase or to pay attention to advertisement. The human organism is very efficient at adapting
to the multitude of stimuli, helping us focus and block out what we deem to be irrelevant.
Let's consider how marketers can use information through each of the senses. V isual
stimuli are obviously important to marketers. Ads show products, product design, print
information, imagery visualization to facilitate desirable lifestyles, etc. Even simple colors
imbue brand associations and can be integral to some brand identities:
• Toothpaste packaging is dominated by whites and blues, implying freshness, clean
liness, water, etc.
• Tiffany's aqua blue boxes have saved many a marriage.
• Dell's blue is deeper and darker than T iffany's, and also trademarked.
Marketers frequently use color to convey information. There are color wheels to guide
the brand manager considering a new logo or packaging. For example, blue seems to con
note dependability and is used widely (American Express, Ford, Intel). Red tends to imply
passion, as in the excitement of breaking news (CNN) or sporting events (ESPN). Green
often implies environmental sustainability (although judge for yourself whether that ap
plies to the green in BP, or whether it's relevant to H&R Block).
The symbolism of colors also varies across cultures, so it is important for a brand manager
responsible for a global multinational brand to test the color's meaning in its major mar
kets. In the U.S., brides wear white because it symbolizes purity (like newly fallen snow).
In India, red conveys purity. In the U.S., red conveys danger and passion; a bride in red
would be .. . unusual. In Western civilizations, purple has traditionally denoted royalty; but
in Thailand, it's the color of mourning. Mourners in Egypt wear yellow, yet yellow implies
courage in Japan and the opposite, cowardice, in the U.S. There are a zillion colors and many
cultures. Imagine the challenge for a brand manager in selecting packaging or logo designs
for global multinational brands.
Brand Col or s
• White Apple, Wikipedia, Honda
• ap ·c
• Orange C rush, Fanta, Harley- Davidson

• Red Coca-Cola, C N N, Kellogg's, Target
• Purple Hallmark, Yahoo
• Blue AT&T, Dell, HP, IBM, Tiffany's
• Green BP, John Deere, Starbucks
• Brown M&M\ U PS
• Black Channel, Gucci, Prada
Hearing is also important to marketers. Research shows that when retailers play back
ground music that is energetic, with a quick tempo, customers spend more. There are other
aural brand associations:
• iPhone vs. Samsung vs. T-Mobile vs. AT&T ringtones
• U nited Airlines' frequent use of Gershwin's Rhapsody in Blue in their ads
• Fancy Feast television commercials feature a high-pitched "ding, ding" (a fork
clinking against fine crystal) implying that the food is special, and therefore worth
its higher price.
Car and motorcycle enthusiasts know that manufacturers are meticulous in deliver
ing distinctive sounds, and, as a result, consumers have come to learn the sounds, expect
them, and pay for them. A high-end Honda motorcycle runs about mid-$20k, whereas a
Harley-Davidson runs in the high $30k. Obviously, the sound is not the only difference
between the two bikes, but if the Harley didn't sound like a Harley, a biker won't fork over
the extra $15k. Similarly, a Porsche 911 turbo at $150k is no clunker, but Ferrari's engi
neers create a symphony of car sounds and charge $250k. Again, even acknowledging other
differences, sound is nevertheless a part of the purchase decision.
A third sense is smell. Think of how many times you've walked through a shopping mall
and felt carried away on the wafting scent of a Cinnabon store or an Auntie Anne's pretzel
store in the food court. Strong perfume scents are a large part of the Bath & Body Works
or The Body Shop stores' ambience. Scent can also be alluded to, drawing on the consumer's
memory, as when Folger's coffee commercials depict a person being awakened by the aroma
of brewing coffee.
A fourth sense is taste. A classic marketing exercise is to run blind taste tests in order to
declare that one's own product is superior to the market leader, or that a "me-too" brand is
liked as well as a market leader. These tests can be dramatic and compelling. They are also
interesting to marketers because they clearly distinguish the power of the brand from the
product itsel£ For example, most people swear they can identify a Pepsi vs.a Coke, and yet
many people actually cannot. Try it on your friends.
A fifth sense is touch. The predominant means of conveying brand imagery through
touch is when marketers create well designed products, compared to products intended to
be positioned for value. For example, design can mean good ergonomics, as in good kitchen
knives, wrist-friendly mice or keyboards, good office chairs, etc. Design can also mean clean
lines, simplicity, and beauty, such as the products that Apple creates. Finally, design can also
certainly mean a sensual experience, like leather interior options in cars, compared to their
less expensive, less touchable alternatives.
Finally, a discussion about sensation and perception wouldn't be complete without men
tion of so-called subliminal advertising. The idea is that an ad can be shown very quickly,
on TV, online, or in the movies, so that it doesn't quite meet the threshold of liminal
recognition and consciousness, and therefore it is said to be subliminal. Yet somehow the
vision is captured subconsciously, and marketers hope the message will compel action (e.g.,
buy more popcorn). Print ads depend not on brief time exposure but on ambiguity. If you
think companies don't do this anymore, take a look at the logo for the Chicago White Sox
baseball team (at whitesox.com) in Figure 2.3. What does it spell?
While marketers have debunked the notion that subliminal advertising works, they
nevertheless conduct a great deal of research in areas called "mere exposure" and "per
ceptual fluency." Neither of these effects is subliminal, per se, but they share a certain
subtlety. For example, mere exposure, as its
Fig u re 2.3 name suggests, says that, though you might
Subliminal Ad not think the billboard you drive past every
day is having a persuasive effect on you, it is.
Marketers know that repeated exposures to
a brand name brings familiarity, and with fa
miliarity comes a comfortable, positive feel
ing. Thus, brands advertised on billboards or
that keep appearing in sidebar ads online
are familiar and would probably rate fairly
positively.
Perceptual fluency is also a subtle phe
nomenon. When consumers thumb through
a magazine or click through websites, they
are probably paying most of their attention
to the content of the message. However, oth
er information is being expressed. Colors and
fonts can make a message seem more profes
sional, more emotional, more contemporary,
more gothic. Those cues make an impression
as well. The cues are liminal but subtle, and
they are part of the brand.
2-3b Learning, Memory, and Emotions

All those sensory and perceptual impressions can become brand associations. To say that
consumers have brand associations means that, in their memory, they have stored certain
attributes attached to the brand. When the brand is mentioned, those associations are
brought to mind. Learning is the process by which associations get past the sensory and
perception stages into short-term memory and then, with repetition and elaboration, into
long-term memory. There are several theories about learning, but two are so fundamental
and pervasive that every marketer should know them.
The first way that people learn is through classical conditioning. This type of learning is
so well known and integrated into our culture that most people have heard of the demon
strations by Ivan Pavlov of his salivating dogs. The learning goes through stages:
•
Stage 1: A food bowl placed in front of a dog naturally elicits its drool.
•
Stage 2: A bell rung in front of the dog initially elicits no response.
•
Stage 3: A bell rung while a food bowl is simultaneously placed in front of the dog
elicits drool.
•
Stage 4: With time, bell rung in front of the dog elicits drool. The dog has come to
learn that the bell is associated with food.
Perhaps you're thinking, "But that's just a dog." Indeed. However, consider Figure 2.4.
It's common to hear that "sex sells," but why or how does it work? The process is this:
•
Stage 1: A babe (male or female) elicits drool.
•
Stage 2: Some brand or product initially elicits no response.
•
Stage 3: That brand or product in a picture with aforementioned babe elicits drool.
•
Stage 4: With time, the brand itself elicits drool.
That might sound a little far-fetched,
but that's the learning process. Consider Fi g u re 2.4
more neutral stimuli, such as the logos in Sex Sells Due
Figure 2.5. At their introduction, these to Classical
abstract symbols convey no information Conditioning
and function much like the bell in Pav
lov's lab. With time, while logos might
not elicit drool, consumers come to learn
and associate these fairly similar looking
symbols with their unique brands.
It's also worth noting, in this ever
changing world, that sometimes compa
nies want to shed negative associations, and
they change their names and logos to do
so. For example, in recent years, Blackwater
became Xe, Philip Morris became Altria,
ValuJet became AirTran, and Andersen
Consulting became Accenture. The hope is
that the slate has been wiped clean, so that
fresh associations might become attached
to the new company names and logos.
Fi gure 2.5
Logos Gain
Meaning
Through
Classical
Conditioning
A fun use of classical conditioning is jingles. It takes only a few exposures before people
learn the catchy lyrics. Consider these jingles; it's hard to resist finishing them, and it's hard
to stop thinking about them:
• M'mm m'mm good ...
• Gimme a break, gimme a break, break me off a piece of that . ..
• Plop, plop, fizz, fizz .. .
• Oh, I wish I were an Oscar .. .
• I'd like to buy the world a ...
• Sometimes you feel like a nut; . . .
And the master of all jingles:
• Two all-beef patties ...
The second way that people learn is through operant conditioning. This type of learning
is also so well known that most people have heard of Skinner boxes. B. F. Skinner studied
pigeons pecking at a target, or rats pressing a bar, to receive food pellets. The pigeon learns
the desired behavior by being rewarded. The behavior is said to be positively reinforced.
Skinner boxes are programmed to reward the pigeon every time it pecks, or only after
every fourth peck, or only at 20 after the hour, etc. When the bird is rewarded every time
or every fourth time, the reinforcement schedule is said to be on a fixed ratio reinforcement
schedule. When the bird is rewarded on average every fourth time (so perhaps after two
pecks, then after six pecks, then after four, etc.), the reinforcement schedule is said to be on
a variable ratio. This difference matters because the unpredictability of the variability drives
the birds (and humans) a little nuts. In the same amount of time, say 30 minutes, the bird
will peck a lot more on the variable, rather than on the fixed, ratio schedule.
So what? Well, consider loyalty programs. Marketers reward consumers who carry their
loyalty cards by giving them every 10th coffee free, for example. If marketers want their
consumers to purchase even more frequently and ring up more sales, they would design a
variable ratio reinforcement program. Each coffee card could have a scratch-off number
indicating that the customer would receive a free coffee after, say, seven coffees. The next
card might say five or 15, etc.
With current programs, the customer's behavior is very predictable. With a variable pro
gram, the customer would be excited about the seven because it means a free coffee is com
ing much faster than after 10. Even when they scratch off and get a higher number, like 15,
they'll still recall that they have had smaller numbers in the past. So the sooner they get to
15 and redeem this card, the sooner they'll get another card, perhaps with a smaller number.
There are also reinforcement schedules based on duration lapses, but these are not
implemented in marketing as frequently. One famous exception, however, is the policy
by Southwest Airlines that allows passengers to obtain their boarding pass classification
24 hours prior to the flight, but no sooner. Passengers who wait too long get less desirable
status, so many fliers find themselves poised over their keyboard to press the right letters at
just the right time. Keyboard pressing is not that different from pigeons pecking.
As any student knows, a big factor in learning and memory is motivation. Thus, we
consider it next.
2-3c Motivation
Figure 2.6 depicts psychologist Abraham Maslow's hierarchy of needs . We have to meet
basic needs-have food on the table and a roof overhead-before we think about buying
Fig u re 2.6
Maslow's
Hierarchy of
Needs
Friendship, Love, Belonging
Safety, Security
Food, Water, Sleep, Sex
nice clothes. Once we have met our basic needs, we are driven by more abstract motiva
tions, such as love and esteem, qualities that begin to define humanity. At the peak of this
pyramid is the phrase, self-actualization, an achievement of our ideal self, with no needs, no
excessive wants, no jealousies, etc.
One way that marketers use this hierarchy is by identifying their product with a certain
level of needs. They use imagery to appeal to those motivations. For example, the VW crash
ads appeal to our need for safety. Similarly, the entire Volvo brand is positioned for safety.
Beyond cars, other examples involve different kinds of security. For example, in B2B, they
used to say, "You won't get fired for buying IBM." Even though IBM was often the most
expensive choice, buyers knew that the quality would be good, so any risk-averse buyer
would feel security in having chosen a good brand.
Many of us are fortunate enough that our simpler needs are met, so a great number
of brands are positioned to heighten a consumer's sense of belonging or, at the next level,
social acceptance and respect. Belonging can be signaled by explicitly affiliative products,
such as team logos, or by conspicuously branded products, as in certain men's athletic shoes
or women's handbags. Belonging can also be more subtle; many ads appeal to a person's
concern with fitting in with the norm. For example, when you start a new job, are you
wearing the right clothing? If all your friends drive a hybrid, will they accept you and your
SUV? And so on.
At the higher level, the acceptance, by self (esteem) and others (respect) is often signaled
by marketers by pointing a consumer to an aspiration group. You might be a business school
student right now, but ads will show you the clothes, restaurants, and cars that the most
successful CEOs wear, dine in, and drive.The implication is that you should begin to shape
your preferences accordingly so that, when you achieve that CEO status, your purchases
will exhibit good taste.
Another way that marketers have used this hierarchy is to offer an extended brand line
that encourages a customer to reach ever higher in the pyramid. For example, Mercedes
makes their entry-level C-Class for the driver who wants the brand but cannot afford
much. Mercedes hopes that drivers will like the C-Class and, when they're ready, trade it in
for an E-, then S-, then CL-Class. This product range is a simple manifestation of customer
relationship management.
Yet another way that the hierarchy is used is when brand managers think about posi
tioning their brands as high in the pyramid as possible.Walmart makes basic sneakers that
satisfy simple needs at the bottom of the hierarchy. However, stronger brands like New Bal
ance can charge more, not just because the product may be somewhat better but because the
consumer wants to believe that the shoes will make them better-better athletes, more fit,
more attractive, better people. The basic Walmart sneaker probably can't be positioned too
high in the pyramid, but it would behoove any other sneaker maker to strive for imagery as
high in the hierarchy as possible.
Beyond the Maslow pyramid, there are other ways to distinguish needs and motivations.
Many consumer psychologists speak of utilitarian vs. hedonic products in fulfilling needs
and wants. A consumer might need a new interviewing suit but want the Armani threads.
Consumer psychologists also point to the motives that co-exist in all of us, for confor
mity vs. individuality. One need may be more salient than another throughout a person's
life, or over an array of situations. If conformity is winning, the consumer buys a popular
brand; if individuality is more important, then the consumer finds an atypical, quirky brand.
Luckily, in most product categories, there are large brand assortments; hence, either need
may usually be satisfied.
A final means of distinguishing consumer motivations is whether they are risk seeking
or risk averse. In some product categories, consumers may be very knowledgeable, opinion
leaders, and ready to try the newest that the market has to offer (the latest music, fashion,
etc.).In other product categories, those same persons may be more risk averse for a variety
of reasons, including caring less about the category or not having the expertise to make
choices confidently. For these purchases, the consumers would be more conservative, trying
to prevent a bad purchase, rather than striving for a good purchase.
P red i cti ng the Weather an d Bra n d Choice

We can't even p redict the weather very well, so why would we expect to be a ble to p redict consume r
pu rchasing?
Weathe r is simple compared to human decision making and pu rchasing. It's comprised of
ve ry few components: wind, water, dirt pa rticles, g ravity, and temperatu re. Yet the best we tend
to say is, " Tomo rrow's weathe r will look something like today's." Similarly, we make the fewest
ma rketing fo recast mistakes if we say, "You'll buy the same b rand of toothpaste this time as you
did last time."
Conside r the facto rs that ente r into a toothpaste pu rchase : What did mom buy? What's on sale?
What flavor do I like? Do I need a small tube fo r t ravel or a big tu be fo r home? Do I want a whitener?
A re my teeth sensitive? Do I want to t ry something new? Do I have a coupon? Am I buying this fo r
myself or someone else? Do I need floss because that b rand is bundled with a container of floss? It's
complicated!
I Yet marketers have sophisticated research techniques to enhance p redictions and answers to
questions such as whethe r this custome r is likely to be a brand switcher, sensitive to a p rice discount,
11 affected by recent adve rtising, etc. Methods to gathe r info rmation from customers a re discussed
throughout this book and in particular a re concent rated in Ch. 15 on marketing research.
1
I
25
I
Eenie, Mea n i e, Jel ly Bea n i e

In their article, "Active Choice: A Method to Motivate Behavior Change;' Professors Punam Keller and
Bari Harlam studied different kinds of so-called opting behaviors:
1. Opt-in: Check this box if you wish a reminder to . . .
2. Opt-out: Check this box if you do not wish a reminder to ...
Options 1 and 2 did okay, but the setup that was much more effective was:
3. Check one: I will remind myself to ... vs.

Yes, please send me a reminder to ...
Getting reminders is very important to engaging in a variety of behaviors, such as getting flu shots,
signing an organ donation card, or enrolling in a company's 40 1k program.
2-3d Attitudes and Decision Making

Marketers want to understand how consumers think and what motivates them so that
they might persuade the consumers to have positive regard for a particular brand and see
it as superior to all others, at least for their needs. Attitudes and decision making affect
the extent to which consumers will buy a brand, repeatedly purchase it, become loyal, and
recommend it to others. If we're really lucky, our brand fans will prefer our brand so much
that they'd even be price insensitive if we had to, or wished to, raise prices. So if we seek to
enhance attitudes about brands and encourage particular brand choices, let's begin with two
questions: What are attitudes? What does the decision making process look like?
Attitudes are conceptualized as a mix of beliefs and importance weights. Beliefs are
opinions, such as BMWs are fast, they're nice to look at, they're expensive, etc. Importance
weights are things like, "I don't care much about whether my car is fast, but I would like
it to be attractive" or "I care about the cost." People can differ on both their beliefs and
importance weights. Some people might say that BMWs aren't that attractive or expensive
relative to other cars. Some people might not care how much a car costs but care very much
about speed.
Importance weights are like the concept of customer involvement. It is an important
truism in marketing, with its natural implications, that, in any purchase category, customers
can be classified according to how much they care about the given purchase. For the things
consumers care about, they spend more time learning about the options and brands, and
they're usually willing to pay more for excellence. For the things consumers care less about,
they spend less time investigating, and it's likely that they won't want to pay much.
The job of marketers is to play with both components of attitudes-beliefs and impor
tance weights. Marketers seek to make the beliefs in an attribute or benefit more positive
and to make the attributes on which the brand dominates other brands seem even more im
portant. The beliefs and importance weights are modified or strengthened through learning
and memory and by appealing to consumer motivations that the brand purportedly satisfies.
Attitudes contribute to decision making and brand choice. In some product categories,
there aren't that many choices, so brands can be compared fairly readily. In categories with
a lot of choices, consumers usually proceed through two stages. In the first, quick stage,
they decide which brands should be considered in more detail vs. those that don't make the
cut to be in the consideration set. The second stage is relatively prolonged, during which
consumers compare the brands in the set to make a purchase choice.
The first stage is thought to be conducted quickly by non-compensatory mechanisms.
"Non-compensatory" means that some attributes are very important. If the brand has them,
then it may be considered further; otherwise, the brand is precluded. Even if the brand
excels at something else, that other excellent attribute does not compensate for the lack of
the first, important quality. For example, if a consumer is set on buying a hybrid car, then
that's the first attribute that reduces the set-cars that are not hybrids are cut from further
consideration. Whichever brands make the cut on this first dimension continue to be con
sidered. The consumer proceeds lexicographically, selecting the attribute or dimension that
is next most important, etc. That subset of brands is compared on the next most important
attribute and so on until the set is reduced to only a few brands.
11 Once the consideration set has been reduced to a manageable number, consumers switch
gears and use a compensatory model. This model uses a costs and benefits logic, whereby
excellence on one attribute can make up for the fact that the brand is not so great in some
other ways. One such model is that of averages, e.g., if a brand is strong on attribute A and
only so-so on B, it may dominate a brand that is average on both attributes A and B.
A lot of online sites allow consumers to select from a number of brands or models to en
able side-by-side comparisons. This information sorting helps consumers see which brands
are best on the attributes they care most about. The algorithms request that consumers first
select the brands to be compared. This stage mimics the non-compensatory stage in reduc
ing the number of possible brands to a more manageable number for further consideration.
The online comparators facilitate the second, compensatory stage, in that the attributes are
lined up for easy viewing. A brand choice is made, and the decision process is completed.
Cross-Cu ltura l Consu mer Behavior

When multi-national companies launch brands internationally, they face the glo bal-local decision.
Should the brand be a unitary, global entity, the same in every market, or should it be tailored for the
tastes and preferences for local customers. Those who argue for a single global brand say that there
needs to be brand consistency across markets to keep a brand strong and its image clear, and to allow
some financial and operational efficiencies. Those who argue for tailored offerings say that customers
will be more favorably inclined to build a connection to a product that is more meaningful to them.
The essence of this strategic decision will be revisited throughout the book, but in this chapter, the
main concern is an understanding of consumers.
There may be ways to leverage some similarities across some countries and cultures so that a
company can enjoy some efficiencies and not have to reinvent a truly unique brand for every
marketplace. Many researchers have studied the similarities and differences among many countries,
but perhaps the best-known framework is that of Geert Hofstede. He uses 5 dimensions to
differentiate countries:
1. " Power distance": clear delineation between those who have power and those who do not. High
power distance cultures are typically very hierarchical, such as Brazil, England, Japan, Portugal,
and many Latin, Asian, and African countries. Low power distance cultures are more egalitarian,
such as Israel, New Zealand, Norway, and the U.S.
2. Cultures also vary along the continuum from "individualism;'in which people mostly look out for
themselves, to "collectivism;' in which people's identities and esteem are rooted in the groups
to which they belong-their families, their companies, their country, etc . Does a person tend
to think in terms of "I" or "we"? Individualistic countries include the U.S . and Canada, Australia
and New Zealand, England, France, and Germany. Collectivistic cultures dominate Asia, Latin
America, and Africa.
3. Countries and cultures differ on whether they are characterized as "masculine;' focused on
achievement, success, and assertiveness or "feminine;' and more focused on modesty, caring
for others, and enhancing the quality of life. Masculine countries include China, Hungary,
Italy, Mexico, the U.K., and the U;S . Feminine countries include Chile, Denmark, Finland, the
Netherlands, Portugal, and Sweden.
4. " Uncertainty avoidance" is the extent to which people are uncomfortable by ambiguity and
therefore try to resolve such situations, usually by imposing rules and structure. Countries with
high uncertainty avoidance are: Belgium, France, Germany, Greece, Italy, Portugal, and Spain.
Countries with relatively more tolerance for ambiguity are: Denmark, Ireland, Poland, Sweden,
the U . K ., and the U.S.
5. " Long-term orientation" is the extent to which people of the culture look to long-term traditions
and look to and save for the future compared to short-term orientation which is a focus on
achieving quick results. Countries that are longer-term oriented are China, Hong Kong, Japan,
compared to shorter-term oriented U . K ., U.S., and Latin American countries .
These differences have clear marketing implications. For example:
• The marketer can expect more conspicuous consumption, in masculine countries, in which
achievement is cele brated, thus helping Cartier, Rolex, and Philippe Patek be judicious in the
marketing dollars they allocate across countries.
• Similarly, in high power distance countries, such as Brazil or Japan, people tend to dress up, a bit
formally, to show respect and to reflect their own position. By comparison, people in low power
distance countries will dress more casually. It's no accident that "casual Friday" was invented in
the U.S .
2-3e How Do Cultural Differences Affect Consumers'

Behavior?
In addition to individual differences in how consumers respond to ads and brands, there
are also predictable sociocultural effects. We'll consider two examples: social class and age.
Some societies have clearer class distinctions than others, but gradations in socioeco
nomic standing are discernible even in relatively classless societies. People tend to be more
comfortable with others in comparable standing.
Social class is a construct that is more complicated than just economic access to resources.
Income is important, but so is family background (e.g., old money vs. nouveau riche) and
career paths (e.g., some allowance for social mobility). Old-monied people seek exclusivity
in their brands, to affirm their special standing in society. They are alarmed by the mass
class movement, in which designers of high-end luxury goods produce far less expensive
lines (albeit not of the same quality) to allow access by us peasants.
In contrast, nouveaus try to make purchases to attain their status, the purchases being
the so-called status symbols. They indulge in conspicuous consumption, e.g., buying goods
with garish, loud branding that shows the world they've made it. Obviously, designing
products, brands, and marketing communications for these two different groups calls for
different approaches.
Age cohorts also produce reliable, predictable shopping patterns. Some patterns are ob
vious, following the household composition and income availability. Young people first buy
furniture and kitchenware, entertainment and travel, and large screen TVs. They proceed
to the stage of buying diapers and toys and minivans. Soon there is college to pay for, then
maybe travel, and, soon, health care. All highly predictable.
Age groups are particularly important when they are large in size. The infamous baby
boomer group is beginning to retire. Older people are traditionally ignored by advertisers
who like to feature youth, but the deep wallets of baby boomers will soon force companies
to pay attention. Cruises will sell, whereas sophomoric movie comedies might decline.
The baby boomer generation was always societal minded, so we might expect to see
large-scale altruism and record levels of infusions of resources into nonprofits. In an odd
contradiction, this generation was also dubbed "the me generation," and indeed sales of
Viagra and cosmetic surgeries have also begun inching upward.
Social class and age cohort are among the various sociocultural factors that impinge
on how buyers form impressions and preferences, collect information, form opinions, and
make brand choices. Gender matters: Men and women are socialized differently, they think
about products differently, and they shop differently.
Finally, ethnicity and country culture provide different perspectives, and they can be very
interesting (and complicated). We'll see examples throughout the book. Be forewarned: It
is difficult to provide generalizations without devolving into stereotypes, so note there are
always exceptions. To foreshadow a few observations now :
•
Wealthy Chinese like their consumption conspicuous. Due to their purchases,
Louis Vuitton has found its busy season has moved to late-January and early-Feb
ruary,just before Chinese New Year (from traditional 4th quarter peaks, attributable
to Christmas shopping).
•
Danes are fond of luxury goods, and their society is so egalitarian that they believe
luxury goods should be accessible to all.
•
European brands tend to dominate the high end, due not just to a perception or
cultural heritage but also to structural industry differences, such as:
o Fine craftsmanship in watches built in Switzerland,

o Fashion or exotic cars designed in Italy, or
0 Supply chains such as extensive fields of flowers or vineyards for perfumeries or
vintners in France.
Chapter 2 Customer Behavior 29
MANAGERIAL RECAP
Keep the buyer in mind, whether you deal with consumers or business customers. Marketing managers can
be nimble and adaptive to industry changes if they have a basic understanding of consumer behavior:3
• There are three major phases of consumption: pre-purchase, purchase, and post-purchase.
• There are three major classes of purchases: For B2C, these are called convenience, shopping, specialty;
for B2 B, these are called straight rebuy, modified rebuy, and new buy. The difference among the three
has to do with customer involvement.
• How do consumers think?
0 They begin with sensing and perceiving information, which may be learned and stored in memory.
o Motivations help marketers understand what consumers are seeking to satisfy with their purchases.
0 Attitudes and decision making are subject to influence by good information as well as biases.
° Finally, social norms, such as generational preferences or choices based on wealth, define us as well.
Chapter Outline in Key Terms and Concepts
1 . The t h ree p h a ses of the p u rchase process b. Learning, memory, and emotions
2. There a re different kinds of p u rch ases c. Motivation
3. The psyc h o l og ic a l science of customer behavio r d. Attitudes and decision making
a. Sensation and perception 4. Ma nageria l recap
Chapter Discussion Questions
1. If consu m e rs a re being del uged by sensory wi ne vs. t h e boxed stuff. N ote partici pa nts' l evel of
overst i m u lation, what can a m a rketer do to cut knowledge a n d su rprise.
th ro u g h the c l u tter?
5. New busi n esses a re freq u ently l a u nc h ed as a
2. Using the p r i n c i p l es of classica l con d ition i ng or mea ns to a d d ress a cu rre n t g l itch in t h e i nd ustry.
o pera nt con d i t i o n i ng, desig n a ma rketing prog ra m P i c k an i n d u stry a nd identify a typica l customer
fo r a non profit or for a pol itica l c a n d idate. p ro b l e m . What cha nges co u l d you m a ke to enter
that i n d ustry and enha nce c u stomer satisfaction
3. What s h o u l d a d s say to h e l p bra n d s m a ke t h e fi rst
(a n d be profita ble)?
(non-compen sato ry) cut in decision making a n d
be i n c l uded i n a consumer's consideration set? 6. Go o n l i ne and find the average length of a "l ife
What s h o u l d a d s say to h e l p a bra n d be chosen, ti me" for p u rchases in t h e categories of: h o u ses,
o nce in the set? ca rs, gym m e m bers h i ps, b a by d i a pe rs, b i rt h con
tro l p i l l s, a n d Via g ra prescri ptions.
4. Run a taste test. Compare Pepsi vs. Coke, or
bottled water vs. ta p, o r a n expensive bottl e of
-
Video Exercise: Scholfi eld Honda (5:48)

....... The video features Roger Sch o lfield, own e r a nd genera l m a nager of Sch o l fi e l d H onda i n Wic h ita,
Kansas, a nd severa l of h i s e m p l oyees descri b i n g the cha racteristics a nd profi les of the d ealers h i p's
c usto m e rs. With respect to p u rchases of both new a nd u sed vehicl es, custo m e rs tend to be very
interested in veh ic l es that a re fuel-efficient a nd env i ron menta l ly frie n d ly. The video focuses on d e
scri b i n g the key cha racteristics of custo mers who a re i nterested i n a nd k n owled gea b l e about h y b rid or a l ternative
fu el veh i cl es. Factors such as the customer's age, l evel of ed ucation, attitudes, a nd needs a re exp l o red. Scho l fi e l d
acknowledges that prospective custom e rs often com p a rison-s h o p at oth e r dea lersh i ps-a n d h e says that he wel
comes such b uyer behavior. H e bel ieves that h is d ea lers h i p has a com petitive adva ntage over other d ea lers h i ps
beca use of the friend l y atmosph ere a n d exceptio n a l service people receiveat Scholfield H o n d a . Appea l i ng to c u s
tomer's needs, desi res, attitudes, a nd bel iefs e n a bl es Scholfield Honda to attract a n d reta i n custo mers.
Vid eo Discussion Questions
1 . U s i n g the p u rchase process (i.e., pre - p u rchase, p u rc h a se, a n d post- p u rcha se), a n a lyze t h e c u stomer i nfo r m a
t i o n provided b y t h e owner a n d e m p l oyees of Scholfield Honda.
2. C h a pter 2 identifies th ree types of p u rchase decisi o n s for consu mers. Descri be t h e type of p u rchase decis i o n
t h a t c h a racterizes t h e b uyi ng behav i o r o f the custom e rs o f Scholfield Hon da.
3. What attitudes and needs seem to be i nfl uential i n peo p l e decid i n g to patro n ize Scholfi e l d H o nda?
M I N I -CAS E
I nsight into Consumer Decision Making for 3-D T V
Va rious media eq u i p consu mers t o m a ke side-by-side com pa risons o f bra nds' relative strengt h s (e.g., Consumer Re
ports, b izrate.com, etc.). These comparisons a re not accl a i med from the m a n ufa ct u rer, but a t h i rd pa rty, so they're
perceived as obj ective a n d neutra l. The ta ble below (based on reviews at c net.com) compa res 3-D televis i o n s on a
n u m be r of criteria. The attri b ute of "crossta l k" ( i n the ta b l e) is not a good th i ng-it's the g h ost- l i ke dou b l e i ma g es
that s h a d ow some 3-D o bjects, depe n d i n g on the tec h n o l ogy; hence, l ess is better. A l l the TVs a re about 65" c u r
rently. Th e 3-D g l asses m ust be p u rc h a sed with each TV (the tech nology is pro p rieta ry wit h i n fi r m and TV, so t h e
Pa nasonic g l a sses won't w o r k w i t h t h e L G TV, for exa m p l e). The g lasses ru n a bo u t $ 1 50 a pa i r.
Som eti mes custom ers know j u st what t h ey wa nt: a p a rti c u l a r bra nd, or a pa rt i c u l a r fea t u re. Someti mes t h e i r
t h o u g ht p rocesses a re l ittle more mea n d eri ng. Some con s u mers a re rather systematic deci s i o n m a kers, s u c h as
when t hey fol low a p roced u re that wi l l e l i m i n ate some a ltern atives by some criteria. Use t h e ta b l e below to si m u
l a te t h e thought processes o f a co n s u m e r.
Chapter 2 Customer Behavior 31
Brand Panasonic LG Sony Samsung
Model TC PVT25
- PX950 XBR H X909
- U NC8000
Technology Plasma Plasma LCD LCD
Price $2,479 $ 1 , 8 50 $2, 497 $2,99 9
Least crosstalk
©©©© ©©©© ©© @
Clear color
©© ©©© © @
Clear, deep black
©©© ©© © @
3-D from angle
© @ ®® @
Flicker
© @ ®® @
3-D glasses Ugly and Rechargeable via Comfortable, Light to wear
uncomfortable USB good peripheral
Case Discussion Questions
I ma g i ne you were a consumer th i n ki n g a bout buyi n g a 3-D TV.
1 . Fi rst, q u ickly at a g l a nce, what TV do you th i n k yo u wou l d buy?

2. On what criteria do yo u t h i n k you based that dec i s i o n ?
Try these decisi o n m a ki n g p rocesses, s e e w h a t b ra n d resu l ts for e a c h , a n d s e e how c o n fi d e n t y o u feel a bout t h e

resulting bra n d s u g gested from each a p p roach:
3. What attri b ute d o you fi n d least i n fo rm ative? E l i m i nate that row. Co nt i n u e to do so u nti l a clea r b ra n d w i n ne r
emerges.
4. Which bra n d of TV wou l d seem to be riskiest to b uy? E l i m i nate it. Cont i n u e u ntil an o bv i o u s choice resu l ts.
5. If you made a p ri ce-ba sed decision, wo u l d you be h a p py?

6. How wou ld you r fi n a l bra n d c h oice d efi n e yo u?
Which of these criteria wou l d n't have concerned you ? How s i m i l a r was t h i s tho u g h t p rocess to you r nat u ra l
a na lysis? H ow ca n you fi nd o ut i f you r consu mers th i n k a long these l i nes?
3 S EG M E N TATI O N
Managerial Checklist
• Why do marketers think about segmentation?
• What are segments?
• What kinds of customer knowledge can be used to identify segments?
• How do you know a good "marketing segmentation" when you see one?
3 - 1 W H Y SEG MENT?
Think about the last time you went to a movie with a couple of your friends.1 Afterward,
when you talked about the movie, how did people respond? Was everyone in complete
agreement about whether they liked the movie? Did everyone agree on the acting or special
effects or music? Probably not. Even among our friends, who tend to be similar to us, tastes
and opinions vary. No one is right or wrong (well, okay, you were right, and your friends
were wrong); it's just a matter of differences in preferences and attitudes.
Psychologists would say that people have different motivations. Recall from Chapter 2
Maslow's hierarchy from biological needs to more abstract ones. Consumers purchase
products to fulfill their needs. For example, consumers who are price conscious make pur
chase decisions using value as a primary attribute, whereas consumers with high needs for
social approval purchase brands with much less of a concern for price.
Economists talk about this differently. They call it
"imperfect competition"; that is, consumers have unique
needs and desires, so collectively a marketplace of con
sumers is heterogeneous. Differences in perceptions and
A company can't be all things preferences require that different products be provid
to all customers. It must choose ed to satisfy the different segments' needs. When a large,
heterogeneous market is segmented into smaller, ho
a segment to serve. mogeneous markets, a company can focus on meeting
the demands of one or two of these groups and create
something that is closer to what the customers want.
Another random document with
no related content on Scribd:
large party of Miaki’s men, all armed, and watching as outposts.
Some were for shooting us, but others hesitated. Every musket was,
however, raised and levelled at me. Faimungo poised his great spear
and said, “No, you shall not kill Missi to-day. He is with me.” Having
made this flourish, he strode off after his own men, and my
Aneityumese followed, leaving me face to face with a ring of levelled
muskets. Sirawia, who was in command of this party, and who once
like Nowar had been my friend, said to me, Judas like, “My love to
you, Missi.” But he also shouted after Faimungo, “Your conduct is
bad in taking the Missi away; leave him to us to be killed!”
I then turned upon him, saying, “Sirawia, I love you all. You must
know that I sought only your good. I gave you medicine and food
when you and your people were sick and dying under measles; I gave
you the very clothing you wear. Am I not your friend? Have we not
often drunk tea and eaten together in my house? Can you stand there
and see your friend shot? If you do, my God will punish you
severely.”
He then whispered something to his company which I did not
hear; and, though their muskets were still raised, I saw in their eyes
that he had restrained them. I therefore began gradually to move
backwards, still keeping my eyes fixed on them, till the bush hid
them from my view, whereon I turned and ran after my party, and
God kept the enemy from following. I would like to think that
Sirawia only uttered the cruel words which I heard as a blind to save
his own life; for at this time he was joined to Miaki’s party, his own
people having risen against him, and had to dissemble his friendly
feelings towards me. Poor Sirawia! Well I knew that Miaki would
only use him as a tool for selfish interests, and sacrifice him at last.
All this showed how dangers grew around our path. Still we trusted
in Jehovah Jesus, and pressed on in flight. A second hostile party
encountered us, and with great difficulty we also got away from
them. Soon thereafter a friendly company crossed our path. We
learned from them that the enemies had slaughtered other two of
Manuman’s men, and burned several villages with fire. Another
party of the enemy encountered us, and were eager for our lives. But
this time Faimungo withstood them firmly, his men encircled us, and
he said, “I am not afraid now, Missi; I am feeling stronger near my
own land!”
Hurrying still onwards, we came to that village on their high
ground called Aneai, i.e., Heaven. The sun was oppressively hot, the
path almost unshaded, and our whole party very exhausted,
especially Faimungo, carrying his load of stolen goods. So here he sat
down on the village dancing ground for a smoke, saying,—
“Missi, I am near my own land now. We can rest with safety.”
In a few minutes, however, he started up, he and his men, in wild
excitement. Over a mountain, behind the village and above it, there
came the shoutings, and anon the tramp, tramp of a multitude
making rapidly towards us. Faimungo got up and planted his back
against a tree. I stood beside him, and the Aneityumese woman and
the two men stood near me, while his men seemed prepared to flee.
At full speed a large body of the tallest and most powerful men that I
had seen on Tanna came rushing on and filled the dancing ground.
They were all armed, and flushed with their success in war. A
messenger had informed them of our escape, probably from Miaki,
and they had crossed the country to intercept us. Faimungo was
much afraid, and said,—
“Missi, go on in that path, you and your Aneityumese; and I will
follow when I have had a smoke and a talk with these men.”
I replied, “No, I will stand by your side till you go; and if I am
killed, it will be by your side. I will not leave you.”
He implored us to go on, but that I knew would be certain death.
They began urging one another to kill us, but I looked round them as
calmly as possible, saying, “My Jehovah God will punish you here
and hereafter, if you kill me or any of His servants.”
A killing-stone, thrown by one of the savages, grazed poor old
Abraham’s cheek, and the dear soul gave such a look at me, and then
upwards, as if to say, “Missi, I was nearly away to Jesus.” A club was
also raised to follow the blow of the killing-stone, but God baffled the
aim. They encircled us in a deadly ring, and one kept urging another
to strike the first blow or fire the first shot. My heart rose up to the
Lord Jesus; I saw Him watching all the scene. My peace came back to
me like a wave from God. I realized that I was immortal till my
Master’s work with me was done. The assurance came to me, as if a
voice out of Heaven had spoken, that not a musket would be fired to
wound us, not a club prevail to strike us, not a spear leave the hand
in which it was held vibrating to be thrown, not an arrow leave the
bow, or a killing-stone the fingers, without the permission of Jesus
Christ, whose is all power in Heaven and on Earth. He rules all
Nature, animate and inanimate, and restrains even the savage of the
South Seas. In that awful hour I saw His own words, as if carved in
letters of fire upon the clouds of Heaven: “Seek, and ye shall find.
Whatsoever ye shall ask in My name, that will I do, that the Father
may be glorified in the Son.” I could understand how Stephen and
John saw the glorified Saviour as they gazed up through suffering
and persecution to the Heavenly Throne! Yet I never could say that
on such occasions I was entirely without fear. Nay, I have felt my
reason reeling, my sight coming and going, and my knees smiting
together when thus brought close to a violent death, but mostly
under the solemn thought of being ushered into Eternity and
appearing before God. Still, I was never left without hearing that
promise in all its consoling and supporting power coming up through
the darkness and the anguish, “Lo, I am with you alway.” And with
Paul I could say, even in this dread moment and crisis of being, “I am
persuaded that neither death nor life ... nor any other creature, shall
be able to separate us from the love of God which is in Christ Jesus
our Lord.”
Faimungo and others now urged us to go on in the path. I said,
“Faimungo, why are we to leave you? My God heard your promise
not to betray me. He knows now what is in your heart and in mine. I
will not leave you; and if I am to die, I will die by your side.”
He replied, “Now, I go on before; Missi, keep close to me.”
His men had gone, and I persuaded my Aneityumese to follow
them. At last, with a bound, Faimungo started after them. I followed,
keeping as near him as I could, pleading with Jesus to protect me or
to take me home to Glory. The host of armed men also ran along on
each side with their weapons ready; but leaving everything to Jesus, I
ran on as if they were my escort, or as if I saw them not. If any reader
wonders how they were restrained, much more would I, unless I
believed that the same Hand that restrained the lions from touching
Daniel held back these savages from hurting me! We came to a
stream crossing our path. With a bound all my party cleared it, ran
up the bank opposite, and disappeared in the bush. “Faint yet
pursuing,” I also tried the leap, but I struck the bank and slid back on
my hands and knees towards the stream. At this moment I heard a
crash above my head amongst the branches of an overhanging tree,
and I knew that a killing-stone had been thrown, and that that
branch had saved me. Praising my God, I scrambled up on the other
side, and followed the track of my party into the bush. The savages
gazed after me for a little in silence, but no one crossed the stream;
and I saw them separate into two, one portion returning to the
village and another pressing inland. With what gratitude did I
recognise the Invisible One who brought their counsels to confusion!
I found my party resting in the bush, and amazed to see me
escaped alive from men who were thirsting for my blood. Faimungo
and his men received me with demonstrations of joy, perhaps feeling
a little ashamed of their own cowardice. He now ascended the
mountain and kept away from the common path to avoid other
Native bands. At every village enemies to the Worship were ready to
shoot us. But I kept close to our guide, knowing that the fear of
shooting him would prevent their shooting at me, as he was the most
influential Chief in all that section of the island.
One party said, “Miaki and Karewick said that Missi made the
sickness and the hurricanes, and we ought to kill him.”
Faimungo replied, “They lie about Missi! It is our own bad conduct
that makes us sick.”
They answered, “We don’t know who makes the sickness; but our
fathers have taught us to kill all foreign men.”
Faimungo, clutching club and spear, exclaimed, standing betwixt
them and us, “You won’t kill Missi to-day!”
In the flight we passed springs and streamlets, but though parched
with sickening thirst, not one of us durst stoop down to drink, as we
should have been almost certainly killed in the act. Faimungo now
sent his own men home by a near path, and guided us himself till we
were close upon the shore. There, sitting down he said,—
“Missi, I have now fulfilled my promise. I am so tired, I am so
afraid, I dare not go farther. My love to you all. Now go on quickly!
Three of my men will go with you to the next rocks. Go quickly!
Farewell.”
These men went on a little, and then said, “Missi, we dare not go!
Faimungo is at war with the people of the next land. You must keep
straight along this path.”
So they turned and ran back to their own village.
To us this district was especially perilous. Many years ago the
Aneityumese had joined in a war against the Tannese of this tribe,
and the thirst for revenge yet existed in their hearts, handed down
from sire to son. Besides, Miaki had incited the people here to
murder the Teachers and me if we attempted to escape this way.
Most providentially the men were absent on a war expedition, and
we saw only three lads and a great number of women and children,
who ran off to the bush in terror. In the evening the enraged savages
of another district assaulted the people of the shore villages for
allowing us to pass, and, though sparing their lives, broke in pieces
their weapons of war—a very grievous penalty. In the next district, as
we hasted along the shore, two young men came running after us,
poising their quivering spears. I took the useless revolver out of my
little native basket, and raising it cried,—
“Beware! Lay down your spears at once on the sand, and carry my
basket to the next landing at the black rocks.”
They threw their spears on the sand, lifted the bag, and ran on
before us to the rocks which formed the march betwixt them and
their enemies. Laying it down, they said appealingly, “Missi, let us
return to our home!” And how they did run, fearing the pursuit of
their foes.
In the next land we saw none. After that we saw crowds all along,
some friendly, others unfriendly, but they let us pass on, and with the
blessing of Almighty God we drew near to Mr. Mathieson’s Station in
safety. Here a man gave me a cocoa-nut for each of our party, which
we greatly required, having tasted nothing all that day, and very little
for several days before. We were so weak that only the struggle for
life enabled us to keep our feet; yet my poor Aneityumese never
complained and never halted, not even the woman. The danger and
excitement kept us up in the race for life, and by the blessing of God
we were now approaching the Mission House, praising God for His
wonderful deliverances.
Hearing of our coming, Mr. Mathieson came running to meet me.
They had heard of my leaving my own Station, and they thought I
was dead! They were themselves both very weak; their only child had
just been laid in the grave, and they were in great grief and in greater
peril. We praised the Lord for permitting us to meet; we prayed for
support, guidance, and protection; and resolved now, in all events, to
stand by each other till the last.
Before I left the Harbour I wrote and left with Nowar letters to be
given to the Captains of any vessels which called, for the first, and the
next, and the next, telling them of our great danger, that Mr.
Mathieson was almost without food, and that I would reward them
handsomely if they would call at the Station and remove any of us
who might be spared thence to Aneityum. Two or three vessels
called, and, as I afterwards learned, got my letters; but, while buying
my stolen property from the Natives for tobacco, powder, and balls,
they took no further notice of my appeals, and sailed past Mr.
Mathieson’s straight on to Aneityum. “The tender mercies of the
wicked are cruel!”
Let me now cull the leading events from my Journal, that
intervened betwixt this date and the final break-up of the Mission on
Tanna—at least for a season—though, blessed be God! I have lived to
see the light rekindled by my dear friends Mr. and Mrs. Watt, and
shining more brightly and hopefully than ever. The candle was
quenched, but the candle-stick was not removed!
On Wednesday, 22nd January, 1862, we heard that other three of
Manuman’s people had been killed and a district burned with fire.
Though this poor man was one of Nowar’s chief friends, yet I heard
him say before my flight, “When so many children are being killed,
why do they not send one for food to me and my family? They are as
tender and good as the young fowls!” A remark like this lets you see
deep into the heart of a Cannibal, and he a sort of half-converted one,
if I may use such an expression; certainly not one of the worst type
by any means.
On the 23rd January, Mr. Mathieson sent for Taura, Kati, and
Kapuku, his three principal Chiefs, to induce them to promise
protection till a vessel called to take us away. They appeared friendly,
and promised to do their best. Alas! the promises of the Tannese
Chiefs had too often proved to be vain.
On Friday, 24th January, report reached our Station that Miaki
and his party, hearing that a friendly Chief had concealed two of
Manuman’s young men, compelled him to produce them and club
them to death before their eyes. Also, that they surrounded
Manuman’s party on a mountain, and hemmed them in there, dying
of starvation and trying to survive on the carcases of the dead and on
bark and roots. Also, that Miaki had united all the Chiefs, friends and
foes alike, in a bond of blood, to kill every one pertaining to the
whole Mission on Tanna. Jesus rules.
SPRINGING FORWARD HE
CAUGHT THE CLUB.
On Sunday, the 26th January, thirty persons came to worship at

the Mission House. Thereafter, at great risk, we had Worship at three
of the nearest and most friendly villages. Amidst all our perils and
trials, we preached the Gospel to about one hundred and sixteen
persons. It was verily a sowing time of tears; but, despite all that
followed, who shall say that it was vain! Twenty years have passed,
and now when I am writing this, there is a Church of God singing the
praises of Jesus in that very district of Tanna. On leaving the second
village, a young lad affectionately took my hand to lead me to the
next village; but a sulky, down-browed savage, carrying a ponderous
club, also insisted upon accompanying us. I led the way, guided by
the lad. Mr. Mathieson got the man to go before him, while he
himself followed, constantly watching. Coming to a place where
another path branched off from ours, I asked which path we took,
and, on turning to the left as instructed by the lad, the savage getting
close behind me, swung his huge club over his shoulder to strike me
on the head. Mr. Mathieson, springing forward, caught the club from
behind with a great cry to me; and I, wheeling instantly, had hold of
the club also, and betwixt us we wrested it out of his hands. The poor
creature, craven at heart however blood-thirsty, implored us not to
kill him. I raised the club threateningly, and caused him to march in
front of us till we reached the next village fence. In terror lest these
Villagers should kill him, he gladly received back his club, as well as
the boy his bow and arrows, and they were lost in the bush in a
moment. At the village from which this man and boy had come, one
savage brought his musket while we were conducting worship, and
sat sullen and scowling at us all the time. Mocking questions were
also shouted at us, such as—“Who made the rains, winds, and
hurricanes? Who caused all the disease? Who killed Mr. Mathieson’s
child?” They sneered and scoffed at our answers, and in this Taura
the Chief joined the rest. They retorted that trading vessels had
called at the Harbour, and that all my clothes and property had been
sold for muskets, powder, caps, and balls, so that Miaki and his men
had plenty of ammunition for fighting purposes now! After this,
feeling that no one could be trusted, we ceased visiting these villages,
and refrained from exposing ourselves at any distance from the
Mission House.
On the 27th, at daylight, a vessel was seen in the offing, as if to
tantalize us. The Captain had been at the Harbour, and had received
my letter from Nowar. I hoisted a flag to induce him to send or come
on shore, but he sailed off for Aneityum, bearing the plunder of my
poor Mission House, purchased for ammunition and tobacco from
the Natives. He left the news at Aneityum that I had been driven
from my Station some time ago, and was believed to have been
murdered.
On the 29th January, the young Chief Kapuku came and handed to
Mr. Mathieson his own and his father’s war-gods and household
idols. They consisted chiefly of a basket of small and peculiar stones,
much worn and shining with use. He said,—
“While many are trying to kill you and drive the worship of
Jehovah from this island, I give up my gods, and will send away all
Heathen idols from my land.”
On the 31st, we learned that a party of Miaki’s men were going
about Mr. Mathieson’s district inciting the people to kill us.
Faimungo also came to inform us that Miaki was exerting all his
artifice to get us and the Worship destroyed. Manuman even sent,
from inland, Raki, his adopted son, to tell me of the fearful sufferings
that he and his people were now passing through, and that some
were killed almost every day. Raki’s wife was a Chief’s daughter, who,
when the war began, returned to her father’s care. The savages of
Miaki went to her own father’s house and compelled him to give her
up as an enemy. She was clubbed and feasted on.
On Sabbath, 2nd February, thirty-two people attended the
morning service. I addressed them on the Deluge, its causes and
lessons. I showed them a doll, explaining that such carved and
painted images could not hear our prayers or help us in our need,
that the living Jehovah God only could hear and help. They were
much interested, and after Worship carefully examined the doll. Mr.
Mathieson and I, committing ourselves to Jesus, went inland and
conducted worship at seven villages, listened to by in all about one
hundred people. Nearly all appeared friendly. The people of one
village had been incited to kill us on our return; but God guided us to
return by another way, and so we escaped.
During the day, on 3rd February, a company of Miaki’s men came
to the Mission House, and forced Mrs. Mathieson to show them
through the premises. Providentially, I had bolted myself that
morning into a closet room, and was engrossed with writing. They
went through every room in the house and did not see me,
concluding I had gone inland. They discharged a musket into our
Teacher’s house, but afterwards left quietly, greatly disappointed at
not finding me. My heart still rose in praise to God for another such
deliverance, neither by man nor of man’s planning!
Worn out with long watching and many fatigues, I lay down that
night early, and fell into a deep sleep. About ten o’clock the savages
again surrounded the Mission House. My faithful dog Clutha,
clinging still to me amid the wreck of all else on Earth, sprang quietly
upon me, pulled at my clothes, and awoke me, showing danger in her
eye glancing on me through the shadows. I silently awoke Mr. and
Mrs. Mathieson, who had also fallen asleep. We committed ourselves
in hushed prayer to God and watched them, knowing that they could
not see us. Immediately a glare of light fell into the room! Men
passed with flaming torches; and first they set fire to the Church all
round, and then to a reed fence connecting the Church and the
dwelling-house. In a few minutes the house, too, would be in flames,
and armed savages waiting to kill us on attempting an escape! Taking
my harmless revolver in the left hand and a little American
tomahawk in the right, I pled with Mr. Mathieson to let me out and
instantly again to lock the door on himself and wife. He very
reluctantly did so, holding me back and saying,—
“Stop here and let us die together! You will never return!”
I said, “Be quick! Leave that to God. In a few minutes our house
will be in flames, and then nothing can save us.”
He did let me out, and locked the door again quickly from the
inside; and, while his wife and he prayed and watched for me from
within, I ran to the burning reed fence, cut it from top to bottom, and
tore it up and threw it back into the flames, so that the fire could not
by it be carried to our dwelling-house. I saw on the ground shadows,
as if something were falling around me, and started back. Seven or
eight savages had surrounded me, and raised their great clubs in air.
I heard a shout—“Kill him! kill him!” One savage tried to seize hold
of me, but, leaping from his clutch, I drew the revolver from my
pocket and levelled it as for use, my heart going up in prayer to my
God. I said,—
“Dare to strike me, and my Jehovah God will punish you! He
protects us, and will punish you for burning His Church, for hatred
to His Worship and people, and for all your bad conduct. We love
you all; and for doing you good only you want to kill us. But our God
is here now to protect us and to punish you.”
They yelled in rage, and urged each other to strike the first blow,
but the Invisible One restrained them. I stood invulnerable beneath
His invisible shield, and succeeded in rolling back the tide of flame
from our dwelling-house.
At this dread moment occurred an incident, which my readers may
explain as they like, but which I trace directly to the interposition of
my God. A rushing and roaring sound came from the South, like the
noise of a mighty engine or of muttering thunder. Every head was
instinctively turned in that direction, and they knew, from previous
hard experience, that it was one of their awful tornadoes of wind and
rain. Now, mark, the wind bore the flames away from our dwelling-
house, and had it come in the opposite direction, no power on Earth
could have saved us from being all consumed! It made the work of
destroying the Church only that of a few minutes; but it brought with
it a heavy and murky cloud, which poured out a perfect torrent of
tropical rain. Now, mark again, the flames of the burning Church
were thereby cut off from extending to and seizing upon the reeds
and the bush; and, besides, it had become almost impossible now to
set fire to our dwelling-house. The stars in their courses were
fighting against Sisera! The mighty roaring of the wind, the black
cloud pouring down unceasing torrents, and the whole surroundings,
awed those savages into silence. Some began to withdraw from the
scene, all lowered their weapons of war, and several, terror-struck,
exclaimed,—
“That is Jehovah’s rain! Truly their Jehovah God is fighting for
them and helping them. Let us away!”
A panic seized upon them; they threw away their remaining
torches; in a few moments they had all disappeared in the bush; and
I was left alone, praising God for His marvellous works. “O taste and
see that God is good! Blessed is the man that trusteth in Him!”
Returning to the door of the Mission House, I cried,—
“Open and let me in. I am now all alone.”
Mr. Mathieson let me in, and exclaimed,—
“If ever, in time of need, God sent help and protection to His
servants in answer to prayer, He has done so to-night! Blessed be His
holy name!”
In fear and in joy we united our praises. Truly our Jesus has all
power, not less in the elements of Nature than in the savage hearts of
the Tannese. Precious Jesus! Does He not chide us, saying,
—“Hitherto ye have asked nothing in My Name. Ask and ye shall
receive, that your joy may be full!”? How much help, blessing, and
joy we lose every day, because we do not take all to Jesus as we
ought! Often since have I wept over His love and mercy in that
deliverance, and prayed that every moment of my remaining life may
be consecrated to the service of my precious Friend and Saviour!
All through the remainder of that night I lay wide awake keeping
watch, my noble little dog lying near me with ears alert. Early in the
morning friends came weeping around us. Our enemies were loudly
rejoicing. It had been finally resolved to kill us at once, to plunder
our house and then to burn it. The noise of the shouting was
distinctly heard as they neared the Mission premises, and our
weeping, friendly Natives looked terror-struck, and seemed anxious
to flee for the bush. But just when the excitement rose to the highest
pitch, we heard, or dreamed that we heard, a cry higher still, “Sail
O!” We were by this time beginning to distrust almost our very
senses; but again and again that cry came rolling up from the shore,
and was repeated from crowd to crowd all along the beach, “Sail O!
Sail O!” The shouts of those approaching us gradually ceased, and
the whole multitude seemed to have melted away from our view. I
feared some cruel deception, and at first peered out very cautiously
to spy the land. But yonder in very truth a vessel had sailed into the
bay. It was the Blue Bell, Captain Hastings. I set fire to the reeds on
the side of the hill to attract his attention. I put a black shawl as a flag
on one end of the Mission House and a white sheet on the other.
This was one of the vessels that had been to Port Resolution, and
had sailed past to Aneityum some time ago. I afterwards saw the
mate and some of the men wearing my shirts, which they had bought
from the Tannese on their former visit. At the earnest request of
Doctors Geddie and Inglis, Mr. Underwood, the owner, had sent
Captain Hastings to Tanna to rescue us if yet alive. For this purpose
he had brought twenty armed men from Aneityum, who came on
shore in two boats in charge of the mate, the notorious Ross Lewin.
He returned to the ship with a boat-load of Mr. Mathieson’s things,
leaving ten of the Natives to help us to pack more and carry them
down to the beach, especially what the Missionary thought most
valuable.
The two boats were now loaded and ready to start. It was about
two o’clock in the afternoon, when a strange and painful trial befell
us. Poor dear Mr. Mathieson, apparently unhinged, locked himself
all alone into what had been his study, telling Mrs. Mathieson and
me to go, for he had resolved to remain and die on Tanna. We tried
to show him the inconsistency of praying to God to protect us or
grant us means of escape, and then refuse to accept a rescue sent to
us in our last extremity. We argued that it was surely better to live
and work for Jesus than to die as a self-made martyr, who, in God’s
sight, was guilty of self-murder. His wife wept aloud and pled with
him, but all in vain! He refused to leave or to unlock his door. I then
said,—
“It is now getting dark. Your wife must go with the vessel, but I will
not leave you alone. I shall send a note explaining why I am forced to
remain; and as it is certain that we shall be murdered whenever the
vessel leaves, I tell you God will charge you with the guilt of our
murder.”
At this he relented, unlocked the door, and accompanied us to the
boats, in which we all immediately left.
Meantime, having lost several hours, the vessel had drifted
leeward; darkness suddenly settled upon us, and when we were out
at sea we lost sight of her and she of us. After drifting about for some
hours in a heavy sea and unable to find her, those in charge of the
boats came near for consultation, and, if possible, to save the lives of
all. We advised that they should steer for Port Resolution by the
flame of the Volcano—a never-failing light-house, seen fifty miles
away—and there await the vessel. The boats were to keep within
hearing of each other by constant calling; but this was soon lost to
the ear, though on arriving in the bay we found they had got to
anchor before us. There we sat in the boats and waited for the
coming day. As the light appeared, we anchored as far out as
possible, beyond the reach of musket shots; and there without water
or food we sat under a tropical sun till mid-day came, and still there
was no sign of the vessel. The mate at last put all the passengers and
the poorest seamen into one boat and left her to swing at anchor;
while, with a strong crew in the other, he started off in search of the
vessel.
In the afternoon, Nowar and Miaki came off in a canoe to visit us.
Nowar had on a shirt, but Miaki was naked and frowning. He urged
me to go and see the Mission House, but as we had seen a body of
men near it I refused to go. Miaki declared that everything remained
as I had left it, but we knew that he lied. Old Abraham and a party
had slipped on shore in a canoe, and had found the windows
smashed and everything gone except my books, which were scattered
about and torn in pieces. The armed men there wanted to kill the
Aneityumese, but others said, “Not till we get Missi killed too!” They
learned that Miaki had sold everything that he could sell to the
Traders. The mate and men of the Blue Bell had on my very clothes.
They boasted that they had bought them for a few figs of tobacco and
for powder, caps, and balls. But they would not return a single shirt
to me, though I was without a change! We had all been without food
in the boat since the morning before, so Nowar brought us off a
cocoa-nut each, and two very small roasted yams for the ladies.
Those, however, only seemed to make our thirst the more severe, and
we spent a trying day in that boat under a burning sun. Miaki said,—
“As our fathers did not destroy Missi Turner’s house, we will not
destroy yours.”
But after a time, failing to persuade me to accompany him and fall
into a trap, he muttered,—
“We have taken everything your house contained, and would take
you too if we could; for we hate the Worship, it causes all our
diseases and deaths; it goes against our customs, and it condemns
the things we delight in.”
Nowar informed me that only a few nights before this, Miaki and
his followers went inland to a village where last year they had killed
ten men. Having secretly placed a savage at the door of every house,
at a given signal they yelled, and when the terrified inmates tried to
escape they killed almost every man, woman, and child. Some fled
into the bush, others rushed to the shore. A number of men got into a
canoe to escape, but hearing women and children crying after them
they returned, and taking those they could with them they killed the
rest lest they should fall alive into Miaki’s hands. These are surely
“they who through fear of death are all their lifetime subject to
bondage.” The Chief and nearly his whole village were cut off in one
night! Not an uncommon thing in those Islands, where war becomes
chronic, and the thirst for blood becomes insatiable. The dark places
of the Earth are “full of the habitations of horrid cruelty.” To have
actually lived amongst the Heathen and seen their life gives a man a
new appreciation of the power and blessings of the Gospel, even
where its influence is only very imperfectly allowed to guide and
restrain the passions of men. Oh, what will it be when all men in all
nations love and serve the glorious Redeemer!
This Miaki and his followers were a scourge and terror to the
whole island of Tanna. They intensely hated Nowar, because he
would not join in their cruelties. Yet he and Manuman and Sirawia
and Faimungo continued to survive long after war and death had
swept all the others away. The first three lived to be very old men,
and to the last they made a profession of being Christians, though
their knowledge was very limited and their inconsistencies very grave
and very numerous. Happy is it for us that we are not the judges, for
souls either of the white or the dark skin, as to how many and
grievous things may be forgiven, and whether there be or be not that
spark of love, that grain of faith which the Lord the Pitiful will
graciously accept and increase![1]
1. See Appendix A. “The Prayer of the Tannese,” etc.
About five o’clock in the evening the vessel hove in sight. Before
dark we were all safely on board, and were sailing for Aneityum.
Though both Mr. and Mrs. Mathieson had become very weak, they
stood the voyage wonderfully. Next day we were all safely landed. We
had offered Captain Hastings £20 to take us to Aneityum, but he
declined any fare. However, we divided it amongst the mate and
crew, for they had every one shown great kindness to us on the
voyage. After arriving on Aneityum, Mrs. Mathieson gradually sank
under consumption, and fell asleep in Jesus on 11th March, 1862, in
the full assurance of a glorious resurrection, and was interred there.
Mr. Mathieson, becoming more and more depressed after her death,
went over to Mr. Creagh’s Station, on Maré, and there died on 14th
June, 1862, still trusting in Jesus, and assured that he would soon be
with Him in Glory. Never more earnest or more faithful souls
entered the Mission field, but they both suffered from weakness and
ill-health during all their time on Tanna, and had frequently to seek
change by removal for a short period from the island. Their memory
is very fragrant to me as fellow-labourers in the Gospel of Jesus.
After their death, I was the only one left alive in all the New
Hebrides Mission north of Aneityum to tell the story of those pioneer
years, during which were sown the seeds of what is now fast
becoming a glorious harvest. Twenty-five years ago, all these dear
brethren and sisters who were associated with me in the work of the
Mission were called home to Glory, to cast their crowns at the feet of
Jesus and enjoy the bliss of the redeemed, while I am privileged still
to toil and pray for the salvation of the poor Islanders, and plead the
cause of the Mission both in the Colonies and at home, in which work
the Lord has graciously given me undreamt-of success. My constant
desire and prayer are that I may be spared to see at least one
Missionary on every island of the group, to unfold the riches of
redeeming love and to lead the poor Islanders to Jesus for salvation.
What could be taken in three boats was saved out of the wreck of
Mr. Mathieson’s property; but my earthly all perished, except the
Bible and the translations into Tannese. Along with the goods
pertaining to the Mission, the property which I had to leave behind
would be undervalued at £600, besides the value of the Mission
House, etc. Often since have I thought that the Lord stripped me thus
bare of all these interests, that I might with undistracted mind
devote my entire energy to the special work soon to be carved out for
me, and of which at this moment neither I nor any one had ever
dreamed. At any rate, the loss of my little earthly all, though
doubtless costing me several pangs, was not an abiding sorrow like
that which sprang from the thought that the Lord’s work was broken
up at both Stations, and that the Gospel was for the time driven from
Tanna.
In the darkest moment, I never doubted that ultimately the victory
there, as elsewhere, would be on the side of Jesus, believing that the
whole Earth would yet be filled with the glory of the Lord. But I
sometimes sorely feared that I might never live to see or hear of that
happy day! By the goodness of the Ever-merciful One I have lived to
see and hear of a Gospel Church on Tanna, and to read about my
dear fellow-Missionaries, Mr. and Mrs. Watt, celebrating the Holy
Supper to a Native Congregation of Tannese, amid the very scenes
and people where the seeds of faith and hope were planted not only
in tears, but tears of blood,—“in deaths oft.”
My own intention was to remain on Aneityum, go on with my work
of translating the Gospels, and watch the earliest opportunity, as God
opened up my way, to return to Tanna. I had, however, got very weak
and thin; my health was undoubtedly much shaken by the continued
trials and dangers through which we had passed; and therefore, as
Dr. and Mrs. Inglis were at home carrying the New Testament
through the press in the language of Aneityum, and as Tanna was
closed for a season, Dr. Geddie, the Rev. Joseph Copeland, and Mr.
Mathieson all urged me to go to Australia by a vessel then in the
Harbour and leaving in a few days. My commission was to awaken an
interest among the Presbyterian Churches of our Colonies in this
New Hebrides Mission which lay at their doors, up till this time
sustained by Scotland and Nova Scotia alone. And further, and very
specially, to raise money there, if possible, to purchase a new Mission
Ship for the work of God in the New Hebrides,—a clamant necessity,
which would save all future Missionaries some of the more terrible of
the privations and risks of which a few examples have in these pages
already been recorded.
After much prayerful deliberation with my brethren and with my
own heart before God, I somewhat reluctantly felt constrained to
undertake the task. If my story was to be the means of providing
more Missionaries for the Islands, and of providing a commodious
Ship for the service of the Mission alone, to keep open their
communications with the outer world and with Christian influences,
not to speak of carrying their provisions at fixed periods, or rescuing
them when in troubles and perils from the jaws of death, I was not
unwilling to tell it again and again, if the Lord would open up my
path. God knows my heart, and any one who really knows me will
easily admit, that no selfish or egotistical motive has influenced me
in reciting through all the Australasian Colonies, New Zealand,
Scotland, and latterly in many parts of England and Ireland, the
incidents of my career and experience, first of all on Tanna, and
thereafter for nearly twenty years—as the Second Part of my
biography will relate—on the neighbouring island of Aniwa; an island
entirely given to me by the Lord, the whole population of which
became Christian; and they and their race will be my crown of joy
and rejoicing in the day of the Lord Jesus.
With regrets, and yet with unquenchable hope for these Islands, I
embarked for Australia, having received the solemn promise of my
brethren, that in entering upon this great effort I was to be left
absolutely free of all control, and empowered to carry out the work as
God might seem to guide me, and open up my way. I had only
spoken to one man in Sydney; all the doors to influence had
therefore to be unlocked, and I had no helper, no leader, but the
Spirit of my Lord. The Second Part of this Autobiography, should
God spare me to write it, will record His marvellous goodness in
using my humble voice and pen and the story of my life for
interesting thousands and tens of thousands in the work of Missions,
and especially for binding together the children of the Sabbath
Schools of Australasia in a Holy League of help to the New Hebrides,
which has already borne precious fruit to His glory, and will continue
to do so for ages to come.
Oftentimes, while passing through the perils and defeats of my
first years in the Mission field on Tanna, I wondered, and perhaps
the reader hereof has wondered, why God permitted such things. But
on looking back now, I already clearly perceive, and the reader of my
future pages will, I think, perceive, that the Lord was thereby
preparing me for doing, and providing me materials wherewith to
accomplish the best work of all my life—the kindling of the heart of
Australian Presbyterianism with a living affection for these Islanders
of their own Southern Seas—the binding of all their children into a
happy league of shareholders, first in one Mission Ship, and finally in
a larger and more commodious Steam-Auxiliary, and, last of all, in
being the instrument under God of sending out Missionary after
Missionary to the New Hebrides, to claim another island and still
another for Jesus. That work, and all that may spring from it in time
and Eternity, never could have been accomplished by me, but for
first the sufferings and then the story of my Tanna enterprise!
Some unsophisticated souls who read these pages will be
astonished to learn, but others who know more of the heartless
selfishness of human creatures, will be quite prepared to hear, that
my leaving Tanna was not a little criticized, and a great deal of
nonsense was written, even in Church Magazines, about the breaking
up of the Mission. All such criticism came, of course, from men who
were themselves destitute of sympathy, and who, probably, never
endured one pang for Jesus in all their comfortable lives. Conscious
that I had, to the last inch of life, tried to do my duty, I left all results
in the hands of my only Lord, and all criticisms to His unerring
judgment. Hard things also were occasionally spoken to my face. One
dear friend, for instance, said,—
“You should not have left. You should have stood at the post of
duty till you fell. It would have been to your honour, and better for
the cause of the Mission, had you been killed at the post of duty like
the Gordons and others.”
I replied,—“I regard it as a greater honour to live and to work for
Jesus, than to be a self-made martyr. God knows that I did not refuse
to die; for I stood at the post of duty, amid difficulty and danger, till
all hope had fled, till everything I had was lost, and till God, in
answer to prayer, sent a means of escape. I left with a clear
conscience, knowing that in doing so I was following God’s leading,
and serving the Mission too. To have remained longer would have
been to incur the guilt of self-murder in the sight of God.”
Never for one moment have I had occasion to regret the step then
taken. The Lord has so used me, during the five-and-twenty years
that have passed over me since my farewell to Tanna, as to stamp the
event with His own most gracious approval. Oh, to see a Missionary,
and Christian Teachers, planted on every island of the New
Hebrides! For this I labour, and wait, and pray. To help on the
fulfilment thereof is the sacred work of my life, under God. When I
see it accomplished, or in a fair way of being so, through the
organization that will provide the money and call forth the men, I
can lay down my head as peacefully and gratefully as ever warrior
did, with the shout of victory in his ears,—“Lord, now lettest Thou
Thy servant depart in peace!”
For the present, my pen is here laid aside. I shall wait to see what
use the Lord makes of Part First of my autobiography, before I
prosecute the theme. If the Christian public seems not to find in it
the help and quickening that some friends think it likely to bestow on
those who read, the remainder need not be written. Part Second, if
called for, will contain a record, in many respects, an utter contrast
to all that has gone before, and yet directly springing therefrom, as
will be seen by all who look beneath the surface. I am penning these
words in 1887, and five-and-twenty years lie betwixt this date and
my farewell to Tanna. These years, if ever published, will tell the
story of my visiting all the Colonial Churches, and collecting the
purchase money of our white-winged Mission Ship, the Dayspring;
my return to Scotland, visiting all the home congregations in 1864,
and securing several new Missionaries to follow me to the New
Hebrides; my second marriage, and settlement on Aniwa, with her
whom the good Lord still spares to me, the mother of our happy
family, and my God-given helpmeet in all the work of the Gospel; the
conversion of that whole island of Aniwa from idolatry, and the
planting there of a Church and Congregation of Christ, from which
have since gone forth many Native Evangelists and Teachers. Then
there will fall to be recorded my call from the Islands in recent years
to revisit all the Colonial Presbyterian Congregations once again,
telling them the story of the Conversion of Aniwa—the sinking of the
well, and other incidents, which turned an entire people from idols
and from cannibalism to the service of the living and true God—
whereby the Churches, and especially the children, were led more
and more to make the New Hebrides their own very harvest field in
the Heathen world. And finally, I will have to tell how I was again
sent home to Scotland in 1884 to raise money for the purchase or
building of a steam-auxiliary Mission Ship, now urgently required in
the interests of the Mission, both because of the great increase in the
number of the Missionaries and the necessities of so many families;
and also and chiefly to avert the dreadful disappointments and loss
of time, and thereby sometimes of life itself, caused by the frequent
becalming of our little Dayspring in these thickly-islanded seas. That
part of the story will show the fruits of the education and perils and
experiences of a lifetime, in the marvellous impression produced by
the simple and unadorned recital of the story of Tanna and Aniwa,
amongst the Christian people of Scotland, Ireland, and England.
Multitudes were blessed in almost every town where a meeting was
granted me. Three Missionaries devoted themselves to the New
Hebrides, and are already labouring there; while others consecrated
themselves to several of the great seats of Foreign Mission enterprise
in Africa and Asia. I returned to my own Church of Victoria with a
sum of nearly £9,000, of which £6,000 was for the new Missionary
Steam-Auxiliary, and the remainder for the outfit and support of
more Missionaries for the Islands; and that money I handed over to
the Australian Church, where it awaits, at interest in the bank, the
arrangements being made by all the Colonies to take each their due
share in the future up-keep of the Ship. For this—for everything—for
all, praise be to the Lord! I never asked one subscription, except in
prayer and in my public appeals. The Lord sent in all freely to me
through the hands of His people; to Him be all the glory. I went back
to Aniwa, and found the work of the Lord going forward there as if in
a regularly settled Congregation at home, fostered and guided by an
occasional visit of my ever dear and genuine friends, Mr. and Mrs.

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Marketing Management 5th Edition

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About the author xii

Part 1 Marketing Strategy

Part 2 Product Positioning

8 New Products and Innovation 109

Part 3 Positioning via Price, Place,

10 Channels of Distribution 161

11 Advertising Messages and Marketing Communications 185

12 Integrated Marketing Communications and Media Choices 205

13 Social Media 224

Part 4 Positioning: Assessment Through

15 Marketing Research Tools 256

17 Marketing Plans 293

About the author xii

Part 1 Marketing Strategy

1 Why Is Marketing Management

1-1 Defining Marketing

2-1 Three Phases of the Purchase Process 13

3-1 Why Segment? 32

3-4 How Do Marketers Segment

4-1 What Is Targeting and Why

5-1 What Is Positioning and Why Is It Probably the Most Important

Part 2 Product Positioning

6 Products: Goods and Services 79

6-1 What Do We mean by Product? 79

7-4 What Are Branding Strategies? 98

8 New Products and Innovation 109

8-1 Why Are New Products Important? 1 09

Part 3 Positioning via Price, Place,

9-1 Why Is Pricing so Important? 1 31

9-8d Competitive Strategy and Game Theory 155

10 Channels of.Distribution 161

1 0-1 What Are Distribution Channels, Supply Chain Logistics, and

11 Advertising Messages and Marketing

1 1 -1 What Is Advertising? 187

12 Integrated Marketing Communications

1 2-1 What Media Decisions Are Made in Advertising Promotional

13 Social Media 224

13·1 What Are Social Media? 224

Part 4 Positioning: Assessment Through

14-1 What Are Customer Evaluations, and Why Do We Care? 239

15 Marketing Research Tools 256