lecture 3 - buyer behavior and competition

7/28/2019 Lecture 3 - Buyer Behavior and Competition

1/35

0

Consumer Behavior and

Compet i t ion


2/35

Consumer Behavior

The field ofConsumer Behavior:

studies how individuals, groups, and organizations

select, buy, use, and dispose of goods, services,

ideas, or experiences to satisfy their needs anddesires.

1


3/35

How And Why Consumers Buy

2

Figu re 6-1:

Model of Custom er Buyer Behavior


4/35

How and Why Consumers Buy

Influence Factors

Cultural

Social

Personal

Psychological

Exert broadest and

deepest influence

Culture Subculture

Social classes

3


5/35


Influence Factors

Cultural

Social

Personal

Psychological

Reference groups

Membership

Primary vs. secondary

Aspirational vs.

dissociative

Family

Social roles and statuses

4


6/35

Discussion Scenario

Consider your purchasing behavior as well asthat of family members.

Does the influence of reference groups,family, and social/roles status vary acrossproduct categories, situation, or by familymember? If so, how and why?

5


7/35


Influence Factors

Cultural Social

Personal

Psychological

Age

Stage in life cycle

Occupation

Economic circumstances

Lifestyle

Personality

Self-concept

6


8/35


Influence Factors

Cultural Social

Personal

Psychological

Motivation

Perception

Learning

Beliefs

Attitudes

7


9/35

Discussion Scenario

Before marketers can communicate a message to

prospects, they must break through selective

attention barriers. In addition to the criteria listed inthe text, the use of novel and intense stimuli can

help to catch attention.

What creative tactics might you use to grab attention

in a print ad? A TV ad?

8


10/35

Competitive Markets

9

Figu re 8-1:

Porters Five Forces that

Determ ine Market

Attract iveness


11/35

Competitive Markets

10

Figu re 8-2:

Barr iers and Prof i tabi l i ty


12/35

Discussion Scenario

Assume that Texas passes legislation which legalizescasino riverboat gambling (riverboats must be locatedon rivers, lakes, or oceans). A limited number of gaming

licenses are strictly controlled by the state gamingcommission.

Assume you work for Harrahs.Using Porters FiveForces, analyze the market attractiveness of Texas.

11


13/35

Competitive Markets

Failing to identify competitors can lead toextinction

Internet businesses have led to

disintermediation of middlemen Competition can be identified using the

industryor marketapproach

12


14/35

Competitive Markets

Industry Structures

Pure Monopoly

Pure Oligopoly Differentiated Oligopoly

Monopolistic Competition

Pure Competition

Only one firm offers an

undifferentiated product or

service in an area

Unregulated

Regulated

Example: Most utility

companies

13


15/35

Competitive Markets

Industry Structures

Pure Monopoly



Pure Competition

A few firms produce

essentially identical

commodities and little

differentiation exists

Lower costs are the key to

higher profits

Example: oil

14


16/35

Competitive Markets

Industry Structures

Pure Monopoly



Pure Competition

A few firms producepartially differentiateditems

Differentiation is by keyattributes

Premium price may becharged

Example: Luxury autos

15


17/35

Competitive Markets

Industry Structures

Pure Monopoly



Pure Competition

Many firms differentiate

items in whole or part

Appropriate market

segmentation is key to

success

Example:beer,restaurants

16


18/35

Competitive Markets

Industry Structures

Pure Monopoly



Pure Competition

Many competitors offer the

same product

Price is the same due to

lack of differentiation

Example: farmers selling

milk, crops

17


19/35

Competitive Markets

A broader group of competitors will be

identified using the market approach

Competitor maps plot buying steps in

purchasing and using the product, as well as

direct and indirect competitors

18


20/35

Competitive Markets

19

Figu re 8-3:

Compet i tor

Map o f

EastmanKodak


21/35

Competitor Analysis

20

Key Competitive Characteristics

to be Identified:

Strengths and WeaknessesEffect a firms competitive position

Reactive Patterns

Objectives

Strategies


22/35

Competitor Analysis

21

Figu re 8-4:

Strategic Groups in the Major Appl iance Indus try


23/35

Discussion Scenario

Choose one of these three product classes: personal

computers, soft drinks, or mass merchandise retailers.

Identify key competitors within your chosen product

class, as well as the competitive position held by each.

Be prepared to defend your classifications.

22


24/35

Competitive Intelligence Systems

23

Designing the

system

Collectingthe data

Evaluating andanalyzing the data

Disseminating information andresponding to queries

Designing the System Involves:


25/35

Designing Competitive Strategies

Major Strategies

Market-Leader

Market-Challenger

Market-Follower

Market-Nicher

Expanding the total

market

Defending marketshare

Expanding market

share

24


26/35


Expanding the Total Market:

Targeting Product to New Users

Market-penetration strategy

New-market strategy

Geographical-expansion strategy

Promoting New Uses of Product

Encouraging Greater Product Use

25


27/35


26

Figu re 8-5:Market Leader Defense Strategies


28/35


Before Attempting to Expand Market Share,

Consider:

Probability of invoking antitrust action

Economic costs involved

Likelihood that marketing mix decisions will

increase profits

27


29/35


Major Strategies

Market-Leader

Market-Challenger

Market-Follower

Market-Nicher

First define the

strategic goals and

opponent(s) Choose general

attack strategy

Choose specific

attack strategy

28


30/35


29

Figu re 8-6:

Market Challenger

A ttack Strategies


31/35


30

Intensive advertising promotion

Productproliferation

Prestige goods Price-discount

Productinnovation

Distributioninnovation

Improvedservices

Manufacturingcost reduction

SpecificAttack

Strategies

Lower-pricegoods


32/35

Discussion Scenario

As brand manager for the HP-Compaq personal

computing division, you have been given the

formidable task of increasing market share.

Identify and justify the general and specific attack

strategies that you would use to accomplish this

goal.

31


33/35


Major Strategies

Market-Leader

Market-Challenger

Market-Follower

Market-Nicher

Imitation may be moreprofitable thaninnovation

Four broad strategies: Counterfeiter

Cloner

Imitator

Adapter

32


34/35


Major Strategies

Market-Leader

Market-Challenger

Market-Follower

Market-Nicher

Niche specialties: End-user

Vertical-level

Customer-size

Specific customer

Geographic

Product/product line

Product feature

Job-shop

Quality-price

Service

Channel

33


35/35

Discussion Scenario

Companies or brands may successfully fill

market niches.

Can you think of some companies or brands

that follow a market niche strategy? If so,

which ones?

34

lecture 3 - buyer behavior and competition

Documents