Introduction to Consumer Behavior and Marketing Strategy Online ...

6/1/2010
Chapter 1
Introduction to
Consumer Behavior and
Marketing Strategy
McGraw-Hill/Irwin
Copyright © 2008 by The McGraw-Hill Companies, Inc. All rights reserved.
Three Elements for Marketing Strategy
Online Business to Consumer
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Introduction
• The marketing concept suggests an
organization should satisfy consumer needs
and wants in order to make a profit
– Need to understand customers
– Must stay close to customers
• Past problems with marketing concept
– The concept was not implemented in the entire
organization and viewed more as a marketing
task
1-4
Introduction cont.
• Shift of focus to better serve consumers for
three major reasons
– Dramatic success of Japanese companies
• Focus on providing consumers value-laden products
• Superior quality and lower prices of Japanese
products
• Increased consumer interest in world markets
– Dramatic increase in the quality of consumer
and marketing research
• Use of technology to identify and know customers
personally
• Ability to track consumer reactions
1-5
Introduction cont.
• Shift of focus to better serve consumers for
three major reasons
– Development of the Internet as a marketing tool
• E-marketing potential
• Increased importance of consumer behavior
research
• Ability to conduct marketing research studies
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What is Consumer Behavior?
• The dynamic interaction of affect and
cognition, behavior, and the environment by
which human beings conduct the exchange
aspects of their lives
• Involves thoughts and feelings people
experience and actions they perform in the
consumption processes
1-7
What is Consumer Behavior? cont.
• Includes all things in the environment that
influence thoughts, feelings, and actions
– Comments from other consumers
– Advertisements
– Price information
– Packaging
– Product appearance etc.
1-8
Dynamic Consumer Behavior
• Thinking, feelings, and actions of individual
consumers, targeted consumer groups, and
society at large are constantly changing
• Requires ongoing consumer research and
analysis of important trends
• Makes development of marketing strategies
difficult and exciting
– Shorter product life-cycle increases importance
of constant innovation
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Consumer Behavior Involves Interactions
• Interactions among people’s thinking,
feelings and actions, and the environment
• Marketers need to understand
– What products and brands mean to consumers
– What consumers must do to purchase and use
them
– What influences shopping, purchase, and
consumption
1-10
Consumer Behavior Involves Exchanges
• Exchange between people involves giving
up of something of value and receiving
something in return
• Role of marketing in society is to help create
exchanges by formulating and implementing
marketing strategies
1-11
Approaches to the Study of Consumer
Behavior
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Major Approaches to Studying Consumer
Behavior
• Interpretive
– Based on theories and methods from cultural
anthropology
– Objective is to understand consumption and its
meanings
– Methods of study involve
• Long interviews
• Focus groups
1-13
Major Approaches to Studying Consumer
Behavior cont.
• Traditional
– Based on theories and methods from cognitive, social,
and behavioral psychology, and sociology
– Objective is to develop theories and methods to explain
consumer decision making and behavior
– Methods of study involve
• Experiments
• Surveys
1-14
Major Approaches to Studying Consumer
Behavior cont.
• Marketing science
– Based on theories and methods from
economics and statistics
– Objective is to develop and test mathematical
models to predict the impact of marketing
strategies on consumer choice and behavior
– This method of study has become popular in the
consumer packaged goods industry since it can
handle large scanner data sets
1-15
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Relationship among Action-Oriented Groups
in Consumer Behavior
1-16
Uses of Consumer Behavior
Research
• Three groups use knowledge about
consumer behavior and consumer behavior
research
– Marketing organizations
• Businesses attempting to sell products
• Organizations that seek exchanges with consumers
– Government and political organizations
• Major concern is monitoring and regulating
exchanges between marketing organizations and
consumers
1-17
Uses of Consumer Behavior
Research cont.
• Three groups use knowledge about
consumer behavior and consumer behavior
research
– Consumers
• Includes consumers and organizational buyers who
exchange resources for various goods and services
• Interest in making exchanges that help them achieve
their goals and the understanding of their own
behavior
1-18
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Consumer Behavior’s Role in
Marketing Strategy
• Marketing strategy
– Design, implementation, and control of a plan to
influence exchanges to achieve organizational
objectives
– In consumer markets, these are designed to
• Increase chances of favorable thoughts and feelings
of particular products, services and brands among
consumers
• Increase chances of trial and purchase
1-19
Consumer Behavior’s Role in
Marketing Strategy cont.
• Marketing strategy
– Developed by manufacturers, retail stores,
catalog retailers, e-tailers and other direct
marketers to
• Increase chances of favorable thoughts and feelings
among consumers about purchasing from them
• Increase chances of actual purchase
– Developed by companies that make funds
available for purchase to
• Increase chances of usage of services offered by
consumers
1-20
Consumer Behavior’s Role in
Marketing Strategy cont.
• Marketing strategies involve developing and
presenting marketing stimuli directed at
selected target markets to influence
– What they think
– How they feel
– What they do
• Essence of marketing strategy is to
understand markets, develop and implement
superior strategies to attract and hold them
profitably
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Consumer Behavior’s Role in
Marketing Strategy cont.
• Powerful force on consumers and society at
large
– The power of marketing and the ability of
consumer research and analysis to yield insight
into consumer behavior should not be
discounted or misused
1-22
Marketing Strategy Queries Consumer
Behavior Research Can Help Answer
1-23
Summary
• The marketing concept was defined and past
problems were discussed
• The aspects of consumer behavior were
presented
• Three major approaches to consumer behavior
research were exhibited
• The groups that use knowledge about consumer
behavior and research were identified
• The role of consumer behavior in a marketing
strategy was discussed
1-24
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