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Consumer Behavior PP Chapter 2
Consumer Behavior PP Chapter 2
Consumer Behavior PP Chapter 2
Consumer Behavior
John C. Mowen
Michael S. Minor
Ten Concepts to Learn
PERMS CB and marketing
Product positioning research
Product CB and the marketing
differentiation mix
Elements of the The bases of
consumer segmentation
environment Behavioral
Behavioral segmentaiton
economics Managerial
applications analysis
Application Areas of
Consumer Behavior:
PERMS
Environmental Analysis
Market Research
Segmentation of the Marketplace
Product Positioning and Product
Differentiation
Marketing-Mix Development
Product Positioning . . .
. . . is influencing how consumers
perceive a brand’s characteristics
relative to those of competitive
offerings
. . . is the
assessment of the
external forces that
act upon the firm
and its customers,
and that create
threats and
opportunities
The Natural
Environment . . .
. . . includes the types of
raw materials available,
pollution, consumer fear
of contracting deadly
diseases, the expansion
of desert regions around
the globe, and various
weather phenomena,
such as hurricanes or
drought
Components of the External
Environment
Demographi Technological
c
Political
Economic
Cultural
Natural
The Economic
Environment
Set of factors involving monetary, natural, and human
resources that influence firms/consumers.
Behavioral economics: study of economic decisions
made by individual consumers and the behavioral
determinants of those decisions.
3 Major Contributions of Behavioral Economists:
Originated and documented the idea that the consumer sector of
the economy can strongly influence the course of the aggregate
economy
Investigated what factors influence the decision of families to
buy or save
Developed a methodology for making predictions of economic
activities based upon consumer surveys
The Technological
Environment
Goal is to anticipate
what changes in the
technological
environment will
occur and how these
will influence the
lifestyle and
consumption
patterns of
consumers
MARKET RESEARCH . . .
Product Pricing
Promotion Distribution
Promotional Strategy
Advertising
Personal Selling
Sales Promotion
Applications
Public Relations
Price Changes
Predicting the likely impact of price
changes on consumers is an
important consumer behavior area.
How will consumers react when
companies raise or lower the price of a
product?
Principles of perception can be applied
to analyze if consumers will notice a
difference in price and if so, what effect
it has
Product Distribution . . .
. . . will be impacted
by understanding how
consumers make their
purchasing decisions.
**Example: low
involvement decision
(e.g., purchase soft
drink), must use
extensive distribution.
Market Segmentation . . .
. . . involves
subdividing the
market place into
distinct subsets of
customers having
similar needs and
wants, each of which
can be reached with
a different marketing
mix
Four Classifications of
Segmentation Variables:
Characteristics of the Person
Nature of the Situation in Which the
Product or Service May Be
Purchased
Geography
Culture and Subculture Adopted by
the Consumer
Characteristics of the
Person
Demographic Characteristics
Behavioral Segmentation:price
elasticity, benefits sought,
usage rate, brand loyalty
Benefit Segmentation
Psychographic and Personality
Characteristics
Demographics is . . .
Subculture is a subdivision of a
national culture and is based on
some unifying characteristic, such
as social status or nationality
Segmenting Industrial
Markets
Different segmenting
variables are used to
classify companies into
segments including the
North American
Industry Classification
System NAICS).
Developed as part of
NAFTA in 1997.
20--2-digit codes.
Solving Managerial
Problems . .
. . . is a three-step process:
Gather information and identify the
problem/opportunity
Identify the relevant consumer
behavior concepts and how they
apply to the problem
Develop a managerial strategy by
identifying the managerial
implications of each consumer
concept.