CHAPTE
R
Consumer
ONE
Behavior:
Meeting
Changes and
Challenges
Consumer Behavior
The behavior that consumers display
in searching for, purchasing, using,
evaluating, and disposing of products
and services that they expect will
satisfy their needs.
Two Consumer Entities
Development of the
Marketing Concept
Production Orientation
From the 1850s to the late 1920s
Companies focus on production
capabilities
Consumer demand exceeded supply
Sales Orientation
From the 1930s to the mid 1950s
Focus on selling
Supply exceeded customer demand
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Chapter One Slide
Marketing Concept
1950s to current - Focus on the
customer!
Determine the needs and wants of
specific target markets
Deliver satisfaction better than
competition
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Chapter One Slide
Discussion Questions
1. What two companies
do you believe grasp
and use the marketing
concept?
2. Why do you believe
this?
Societal Marketing Concept
Considers
consumers longrun best interest
Good corporate
citizenship
The Marketing Concept
Embracing the
Marketing
Concept
Consumer
Research
Segmentation
Market
Targeting
Positioning
The process and
tools used to study
consumer behavior
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The Marketing Concept
Implementing the
Marketing
Concept
Consumer
Process of dividing
Research
Segmentation
Market
Targeting
Positioning
the market into
subsets of
consumers with
common needs or
characteristics
11
Discussion Questions
1. What products that you regularly
purchase are highly segmented?
2. What are the different segments?
3. Why is segmentation useful to the
marketer for these products?
Copyright 2010 Pearson Education, Inc. publishing
12
Chapter One Slide
The Marketing Concept
Implementing the
Marketing
Concept
Consumer
The selection of one
Research
Segmentation
Market
Targeting
Positioning
or more of the
segments identified
to pursue
13
The Marketing Concept
Implementing the
Marketing
Concept
Developing a distinct
Consumer
Research
Segmentation
Market
Targeting
Positioning
image for the product in
the mind of the consumer
Successful positioning
includes:
Communicating the
benefits of the product
Communicating a
unique selling
proposition
14
The Marketing Mix
15
Customer Value,
Satisfaction, Trust, and
Retention
16
Successful Relationships
Value,
Satisfaction,
Trust,
and
Customer
Retention
Value
Customer
Satisfaction
Customer
Trust
Customer
Retention
Defined as the ratio
between the
customers perceived
benefits and the
resources used to
obtain those benefits
Perceived value is
relative and subjective
Developing a value
proposition is critical
17
Discussion Questions
How does
McDonalds
create value for
the consumer?
How do they
communicate this
value?
18
Successful Relationships
Value,
Satisfaction,
Trust,
and
Customer
Retention
Value
Customer
Satisfaction
Customer
Trust
Customer
Retention
The individual's perception
of the performance of the
product or service in
relation to his or her
expectations.
Customer groups based on
loyalty include loyalists,
apostles, defectors,
terrorists, hostages, and
mercenaries
19
Successful Relationships
Value,
Satisfaction,
Trust,
and
Customer
Retention
Value
Customer
Satisfaction
Customer
Trust
Customer
Retention
Establishing and
maintaining trust
is essential.
Trust is the
foundation for
maintaining a
long-standing
relationship with
customers.
20
Successful Relationships
Value,
Satisfaction,
Trust,
and
Customer
Retention
Value
Customer
Satisfaction
Customer
Trust
Customer
Retention
The objective of providing
value is to retain highly
satisfied customers.
Loyal customers are key
They buy more products
They are less price
sensitive
Servicing them is
cheaper
They spread positive
word of mouth
21
Top 10 Ranked Indian Companies in
Terms of Consumers Trust and Respect
of Privacy
22
Customer ProfitabilityFocused Marketing
Tracks costs and
revenues of
individual
consumers
Categorizes them
into tiers based on
consumption
behavior
A customer
pyramid groups
customers into
four tiers
Copyright 2010 Pearson Education, Inc. publishing
23
Chapter One Slide
THE TRADITIONAL MARKETING
CONCEPT
VALUE- AND RETENTIONFOCUSED MARKETING
Make only what you can sell instead
of trying to sell what you make.
Use technology that enables
customers to customize what you
make.
Do not focus on the product; focus on
the need that it satisfies.
Focus on the products perceived
value, as well as the need that it
satisfies.
Market products and services that
match customers needs better than
competitors offerings.
Utilize an understanding of customer
needs to develop offerings that
customers perceive as more valuable
than competitors offerings.
Research consumer needs and
characteristics.
Research the levels of profit
associated with various consumer
needs and characteristics.
Understand the purchase behavior
process and the influences on
consumer behavior.
Understand consumer behavior in
relation to the companys product.
Realize that each customer
transaction is a discrete sale.
Make each customer transaction part
of an ongoing relationship with the
customer.
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Chapter One Slide
24
Impact of Digital
Technologies
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25
Chapter One Slide
The Mobile Consumer
Wireless Media
Messages will
expand as:
Penetration of Internet Usage Among
Mobile Subscribers in 16 Countries FIGURE 1.3
Flat-rate data
traffic increases
Screen image
quality is
enhanced
Consumer-user
experiences with
web applications
improve
26
Chapter One Slide
Consumer Behavior Is
Interdisciplinary
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27
Chapter One Slide
A Simple Model of Consumer Decision
Making - Figure 1.4
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28
Chapter One Slide
