mkt 4

Consumer Decision-Making Process

  • Need Recognition:

    • Consumers become aware of a problem that requires a solution.
    • Marketer Strategies: Create wants and needs by highlighting products or services that address the problem.

  • Search Process:

    • Consumers seek alternatives that can solve their need.
    • Marketer Strategies: Ensure products are readily available and within reach for potential customers.

  • Evaluation of Alternatives:

    • Consumers examine alternatives to find the best fit for their needs.
    • Marketer Strategies: Persuade consumers that the attributes of their product matter the most by highlighting unique selling points.

  • Purchase Decision:

    • Consumers decide to purchase the alternative that fits their needs best.
    • Marketer Strategies: Streamline the purchasing process to reduce friction and enhance satisfaction.

  • Post-Purchase Evaluation:

    • Consumers evaluate their decision after the purchase, determining satisfaction or regret, and possible loyalty.
    • Marketer Strategies: Conduct follow-ups, satisfaction surveys, offer warranties, create return policies, introduce loyalty rewards, encourage reviews, and provide after-purchase support.

Consumer Involvement and Behavior Factors

  • Consumer Involvement: Influenced by the perceived risks and importance associated with purchases (classified as high or low involvement).

  • Factors Influencing Consumer Behavior:

    • External Factors:

    • Situational factors (e.g., product placements).

    • Social norms that shape expectations based on societal values.

    • Timing (time of day/year affecting product interest).

    • Purpose of Purchases (routine vs. special occasion).

    • Personal Factors:

    • Demographic factors (gender, age, life stage).

    • Lifestyle choices (activities and interests shaping preferences).

    • Mood (short-term mood impacts on consumer interests).

    • Personality traits (the Big Five: openness, extraversion, agreeableness, conscientiousness, neuroticism).

    • Psychological Factors:

    • Motivation: The inner drive to fulfill needs based on Maslow's hierarchy of needs:

      • Physiological: Basic needs like food and water.
      • Safety: Needs for security and protection.
      • Social: Needs for belonging and love.
      • Esteem: Needs for respect and self-esteem.
      • Self-Actualization: Achieving personal potential.

    • Perception: How consumers interpret information.

    • Learning: The process through which consumers change behavior based on experiences.

Consumer Learning

  • Incentives: For product trials to stimulate discussion about experiences.
  • Conditioned Responses:
    • Pair an unconditioned stimulus (e.g., Santa) with a neutral stimulus (e.g., Coca-Cola) to evoke positive feelings towards the product.

Attitudes

  • Definition: Mental positions, emotions, or evaluations towards products, which may be favorable or unfavorable.

Societal Influences

  • Culture: Shared beliefs and behaviors in a society.
  • Subculture: Distinct groups with different characteristics within the larger culture.
  • Social Class: Groups with similar income, education, and mindsets.
  • Reference Groups: Groups that influence individual behavior and decisions.
  • Family: Family influences preferences and behaviors in buying decisions.

Understanding the Customer: Marketing Research Process

  1. Define the Problem/Opportunity: Clarify what the research aims to accomplish.
  2. Design the Research: Identify data types (primary vs. secondary) and methods (qualitative vs. quantitative).
  3. Design Data Collection Forms: Outline structure, such as introduction, instructions, warm-up questions, and demographic questions.
  4. Specify the Sample: Determine the population of interest and size for reliable results.
  5. Collect the Data: Execute the research by gathering information from the specified sample.
  6. Analyze the Data: Clean, organize, and explore data to answer research questions.
  7. Write the Research Report: Summarize findings concisely using research paper formats (Title page, Table of contents, Executive summary, Methodology, Findings, Recommendations).

Percentage Change

  • Definition: Represents relative change between previous and current values, useful for tracking performance over time.
  • Formula:
    Percentage Change (Percentage\, Change\, (%) = \frac{New\, Value - Old\, Value}{Old\, Value} \times 100
  • Importance:
    • Enables accurate comparisons across different time periods for revenue, costs, etc.
    • Provides insights that raw numbers alone cannot convey—especially important for strategic decision-making.

Example Calculation

  • NT Inc.'s Growth:
    • Workforce in 2010: 50 employees
    • Workforce in 2022: 600 employees
    • Calculate percentage change:
      Percentage Change (Percentage\, Change \,(%) = \frac{600 - 50}{50} \times 100 = 1100\%
    • Result: Workforce increased by 1100% since 2010.