MT 219 Marketing Unit Three

Global Marketing and Consumer Behavior

Note: This seminar will be recorded.

Review of Unit Two

• How did it go? Questions or concerns?

• Suggestions for Unit 3: Assignment templates built into introduction & Remember that the unit 4 review will also use concepts from unit 3

• Questions?

In this unit we will cover

• Global Marketing-International environmental forces

-Trade Alliances, markets and agreements

• Consumer Behavior--Involvement levels and their impact on problem solving

-The consumer buying decision process

-Situational, psychological and social influences

International Marketing

Defined in text as: “Developing and performing marketing activities across national boundaries.”

Increasingly, international marketing is a way firms can ensure marketing success when domestic markets have been saturated.

International Environmental Forces• All aspects of the marketing mix must often be changed to be

successful in international markets.- Sociocultural- extremely important – products that are socially or culturally inappropriate are unlikely to be successful.

- Economic- Marketers must keep price in line with competition and, consumer expectations and ability to buy.

- Political – Marketers must ensure they do not undertake controversial activities that will result in political fallout. This include relations with labor unions

- Legal- Marketers must ensure they conform to the requirements of the countries they do business in.

- Competitive- The company needs to undertake competitive activities that are considered suitable in international markets. Laws vary.

- Technological- Marketers should not assume their technology is compatible with people’s or country’s needs.

Trade Alliances and Agreements

• There are several main groups, but many countries also have bilateral trade agreements not in the text.

- NAFTA- Trade agreement between Mexico, Canada and the US,- European Union- Higher form of agreement that joins member states in trying to develop a common economic partnership.

- APEC- Asian alliance that seeks to cooperate on common trade issues.- MERCOSUR- South American- The goal is a common market like Europe. Currently an alliance.

- GATT- Group of countries that agree to certain rules and agree to a process for settling trade disputes so they do not spiral out of control. The WTO was created in Uruguay Round of GATT to promote free trade.

Consumer Behavior

The buying behavior of people who purchase products for personal or household use and not for business purposes

We study consumer behavior in order to-understand the major influences on what, where, when and how consumers buy

-be in a better position to develop marketing strategies

High Involvement vs. low involvement

IntensityImportanceRisk assessment

Enduring vs. Situational involvement

Types of buying behavior

• Routinized response behaviorfrequently purchased, familiar, lost cost items

• Limited Problem Solving behaviorunfamiliar brand in familiar category

• Extended Problem Solvingunfamiliar, expensive or infrequently purchased items

Consumer Decision Process

Problem Recognition

Information SearchInternalExternal

Evaluation of Alternativesconsideration setevaluative criteria

Purchase

Post Purchase EvaluationCognitive Dissonance

Situational Influences

• Physical surroundings: location, store atmosphere, aromas, sound, lighting, weather and other factors.

• Social surroundings: others who are present when the purchase is made. Friends, relatives, salespeople and other customers can all affect behavior

• Time perspective: the amount of time required to become knowledgeable about a product, search for it, and purchase it, are also factors.

• Reason for purchase: People behave differently depending on the reason for the purchase

• Buyers momentary mood and condition

Plus – concern for the opinion of others

Psychological influences - Perception

• Perception is “he process of selecting, organizing, and interpreting information in a way that is meaningful for us. Because the average consumer is bombarded with constant information everyday, we are selective in what we choose to be exposed to”.

• Human beings also interpret information based on existing knowledge. Therefore, we selectively distort new data in such a way as to make it consistent with existing data.

- Selective Exposure- Selective Distortion- Selective Retention

Motives and Maslow’s Hierarchy

• Self actualization• Esteem• Social• Safety• Physiological

Learning

• Change in behavior resulting from experience and information• Begins with

- Need- Cue- can be turned on by any sense- Response- Reinforcement- Generalization

Attitudes

• Have Direction (degree of “goodness” or “badness”) and Intensity

• Hard to Change, but do-able• A belief linked to an emotion

Personality and Self-Concept

• Results in consistent patterns of behavior• Includes purchase behavior• Many times these may be subconscious

Lifestyle

• Activities (golf, bowling)• Interests (politics)• Opinions (being “green”)

Social Influences

• Roles• Socialization and Family• Reference Groups

membershipaspirationdissasociative

Opinion Leaders

Social Classes• Open groups of individuals with similar social rank

- Education, Occupation, and Income

- Upper: prize quality merchandise, prestigious brands, and products that reflect good taste. Money is invested in art as well as travel, books, tennis, golf, and swimming clubs

- Middle: like fashionable items, spend for worthwhile experiences such as college educations and ski trips, tour packages, and attractive home furnishings.

- Working: have a strong sense of value, shop for bargains as well as vehicles and equipment related to recreation and camping as well as automotive equipment

- Lower: purchase mostly products required for survival, necessities

Culture

• Single broadest determinant of consumer behavior

• Accumulation of values, knowledge, beliefs, customs, objects, and concepts that characterizes a society

Subcultures

• Groups of individuals whose values and behavior patterns are similar

• Can be based on a number of factors, including- Geography

- Demographic characteristics

- Common experiences and history

Any Questions?

Thank you for attending!

See you next week!

I will post the link to the recording of tonight’s seminar in the course Announcements.