Chapter 2

Diploma in Business Management

ANALYZING CONSUMER MARKETSC H A P T E R 6

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The chapter examines how the field of marketing is influenced by the actions of consumers, and also how we as consumers are influenced by marketers. It also overviews consumer behaviour as a discipline of enquiry, and describes some of the different approaches that researchers use in order better to understand what makes consumers behave as they do.

The field of consumer behaviour covers a lot of ground: it is the study of the processesinvolved when individuals or groups select, purchase, use or dispose of products,services, ideas or experiences to satisfy needs and desires. Consumers take many forms,ranging from a 6-year-old child pleading with her mother for wine gums to an executivein a large corporation deciding on an extremely expensive computer system. The itemsthat are consumed can include anything from tinned beans to a massage, democracy, rapmusic, and even other people (the images of rock stars, for example). Needs and desiresto be satisfied range from hunger and thirst to love, status or even spiritual fulfilment.

There is a growing interest in consumer behaviour, not only in the field of marketing butfrom the social sciences in general. This follows a growing awareness of the increasingimportance of consumption in our daily lives, in our organization of daily activities, inour identity formation, in politics and economic development, and in the flows of globalculture, where consumer culture seems to spread, albeit in new forms, from NorthAmerica and Europe to other parts of the world. This spread of consumer culture viamarketing is not always well received by social critics and consumers, as we shall see insubsequent chapters.4 Indeed, consumption can be regarded as playing such an importantrole in our social, psychological, economic, political and cultural lives that today ithas become the vanguard of history.

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Essential Readings1) Consumer Behaviour, A European Perspective, Michael Solomon, Gary Bamossy, Sren Askegaard, Margaret K. Hogg, 3rd edition Prentice Hall

2) Lecture PowerPoint Presentation Slides Chapter 6

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LEARNING OBJECTIVESAfter reading this chapter, students should:

Know how consumer characteristics influence buying behavior Know what major psychological processes influence consumer responses to the marketing program Know how consumers make purchasing decisions Know how marketers analyze consumer decision making

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CONSUMERS IMPACT ON MARKETING STRATEGY

Surfing websites or discussing products and brands can be a lot of fun almost as muchfun as actually making the purchases! But, on the more serious side, why should managers, advertisers and other marketing professionals bother to learn about this field?The answer is simple: understanding consumer behaviour is good business. A basicmarketing concept states that firms exist to satisfy consumers needs. These needs canonly be satisfied to the extent that marketers understand the people or organizationsthat will use the products and services they offer, and that they do so better than theircompetitors.

Consumer response may often be the ultimate test of whether or not a marketingstrategy will succeed. Thus, knowledge about consumers is incorporated into virtuallyevery facet of a successful marketing plan. Data about consumers help marketers todefine the market and to identify threats and opportunities in their own and othercountries that will affect how consumers receive the product. In every chapter, well seehow developments in consumer behaviour can be used as input to marketing strategies.Boxes headed Marketing opportunity will highlight some of these possibilities. Sonysintroduction of the Walkman is one good example of how consumers initially turneddown the product when the concept was tested in the market.9 The product was launchedanyway and the Walkman was an immense success Sony revolutionized the mobilemusic experience and sold almost 300 million Walkmans in the process. This doesnot mean that Sony now eschews consumer research, as is demonstrated by these fewexamples of marketing actions that resulted from studies focused on understandingconsumers.

Recent research found that todays teens see portable cassette players as dinosaurs.Sonys advertising agency followed 125 teens to see how they use products in theirday-to-day lives. Now, even portable CD players seem obsolete and not cool withthe consumer movement to removable memory sticks instead of a CD player that canwork with MP3 files. The Walkman also needed a fresh message, so Sonys agencydecided to use an alien named Plato to appeal to teens. This character was chosen toappeal to todays culturally ethnically diverse marketplace. As the account directorexplained, An alien is no one, so an alien is everyone.10 In addition to the memorystick players, the Apple iPod has also greatly changed the consumer music scene. Thedesigner of the iPod, Jonathan Ives, has himself become part of popular culture, andin a recent poll was voted Most Influential Person in British Culture, beating authorJ.K. Rowling and Ricky Gervais, star and creator of the popular television programme_____________________________________________________________________

CONCLUSIONConsumer behavior is influenced by three factors: cultural (culture, subculture, and social class); social (reference groups, family, and social roles and statuses); and personal (age, stage in the life cycle, occupation, economic circumstances, lifestyle, personality, and self-concept). Research into all these factors can provide marketers with clues to reach and serve consumers more effectively.

Four main psychological processes affect consumer behavior: motivation, perception, learning, and memory.

To understand how consumers actually make buying decisions, marketers must identify who makes and has input into the buying decision; people can be initiators, influencers, deciders, buyers, or users. Different marketing campaigns might be targeted to each type of person.

The typical buying process consists of the following sequence of events: problem recognition, information search, evaluation of alternatives, purchase decision, and postpurchase behavior. The marketers job is to understand the behavior at each stage. The attitudes of others, unanticipated situational factors, and perceived risk may all affect the decision to buy, as will consumers levels of postpurchase product satisfaction, use, and disposal and actions on the part of the company.

Consumers are constructive decision-makers and subject to many contextual influences. Consumers often exhibit low involvement in their decisions, using many heuristics as a result.

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