marketing management (mkt600) anna zarkadamba.teipir.gr/files/marketing...

Marketing Management (MKT600)

Anna Zarkada

MM BB AA

Developing Exchange Relationships

Who are the buyers ?

What do buyers want?

Why do people choose the things they do?

How do we find the answers?

Where should we target our efforts?

Which is the best approach for out target

market?

Consumers and

Industrial Buyers

Products and Services VALUE

Buyer Behaviour

Market and Buyer Behaviour Research

Market Segmentation

Product Positioning

Techniques

Theories

Strategy

What is consumer behaviour?

Consumer behaviour is the study of

how individuals or groups buy, use and

dispose of goods, services, ideas or

experiences to satisfy

their needs and wants.

Model of Consumer Behavior

Figure 7.2 Model of consumer behaviour

CONSUMER PSYCHOLOGY

Key Psychological Processes

Motivation

•Maslow

•Freud

•Yung

Memory

• Short term

• Long term

• Associative network

Learning behavioral changes in response to

• experience

• drive

• cues

• discrimination (the process by which we

learn to make different responses to different stimuli)

• hedonic bias (I passed / he failed me)

Perception

• Selective attention

•Selective distortion

•Selective retention

• Subliminal perception

Learning

CONSUMER

CHARACTERISTICS

Consumer Characteristics

•Cultural

•Social

•Personal


Culture: Definition

Culture is

• shared

• learned

• dynamic

• adaptive but resilient

Culture provides

• identity

• context

• cohesion Culture: Characteristics

Material Culture • Artefacts

• Materialism

• Technology • Determinism

• Science, Exploration & R&D

• Economics • Production, distribution & consumption

• Wealth creation, accumulation & distribution

• Migration, Colonisation & Imperialism

Language & Communication • Verbal

•Translation & Interpretation

• Perfect Language & Lingua Franca

• Non-verbal • Space & Time

• Body Language

Social Structure • Stratification

• Mobility

• Organisations • Association

• Kinship

Religion • Beliefs

• Practice

• Morality

Aesthetics • Beauty

• Good taste

• Form, Shape and Colour

• Art • Popular & High Art

• Humour

Culture: Elements

Basic Assumptions

Norms & Values

Behaviours,

Artefacts & Products

Culture: A model

Hall

Comparing Cultures I

• sin

• ind • phil

• ita

• gre

• jap

• mex • fra

• fin

• isr

• aus • ger

• saf

• nzl • usa

• den • gbr

Hofstede

Comparing Cultures II

CULTURAL VARIEGATION “Santa Died for your Mastercard”

Subcultures

Nationalities

Religions

Racial groups

Geographic regions

Social Factors

Reference groups

• Membership

• primary

• secondary

• Non membership

• aspirational

• dissassociative

Social

roles

Status(es)

Family

Family of Orientation

(parents and siblings)

Family of Procreation

(spouse and children)

Roles of family members in the

buying decision process

• income earner

• decision maker

• influencer

• user

• buyer

• payer


Personal Factors

Age /

Generation

Values

Life cycle

stage

Occupation

Personality

Self-

concept

Wealth

Lifestyle

Age VS Generation

Lost Generation (1883–1900)

Greatest Generation (1901–1924)

Silent Generation (1925–1942)

Baby Boomer (1943–1960)

Generation X (1961–1981)

Generation Y-millennials-9/11* (1982–

2001) * people who were between the ages of 10 and 20 on September 11, 2001

? Generation Z-Generation@-

Net/iGeneration-Plurals* (2001 - ) * expected to be the first generation to earn less than their parents

Digital

Immigrants

Digital

Natives

Life Cycle Stage

◦ early years (<14) ◦ new consumers (15-17) ◦ young adults (18-34) single married no children married with children single parents

◦ middle years (35-54) single married no children married with children single parents empty nesters

◦ elderly (>55)

VALS™ survey – Values-Lifestyle

culture-personality

http://www.strategicbusinessinsights.com/vals/ustypes.shtml

http://www.strategicbusinessinsights.com/vals/demobehav.shtml

http://www.strategicbusinessinsights.com/vals/presurvey.shtml

LOHAS

(Lifestyles of Health and

Sustainability) market segments

• Sustainable economy

• Healthy lifestyles

• Ecological lifestyles

• Alternative health care

• Personal development

CONSUMER DECISION

MAKING

Philosophical Perspectives on Buyer

Behaviour

• Homo Œconomicus – rational,

focused on use and cost

• Passive man – receiver of

messages, Pavlov’s dogs and

cockroaches

• Cognitive man – collector of

information

• Emotional man - consumed by

subjective criteria

• Postmodern man – the variegated

one

Problem

recognition Information

search

Evaluation Choice Purchase

decision

Post Purchase

Behaviour

•Buy

•re-buy

•Loyalty …

Core

Product Tangible

Product

Augmented

Product

Buyer Decision model of the Homo

Œconomicus

Sources of information

Personal

Experiential Public

Commercial

Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall

Evaluation: Successive Sets Involved

in PC Consumer Decision Making


Perceived Risk

Functional

Physical

Financial

Social

Psychological

Time

Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall

How Customers Use and Dispose of

Products

Post-purchase behaviour

Post-purchase behaviour

Post-purchase satisfaction/ dissonance

Post-purchase actions

Post-purchase use and disposal

Questions

• What are customer

• value,

• satisfaction, and

• Loyalty

and

• how can companies deliver them?

• How can companies cultivate strong

customer relationships?

• How can companies both attract and retain

customers?


Organizational Philosophies

Figure 11.1 Traditional organisation vs. modern customer-oriented company organisation

EXPECTATIONS ->

VALUE->

SATISFACTION->

LOYALTY

Five Types of Customer Needs 1.Stated needs: what the customer explicitly

asks for “I want an inexpensive car”

2.Real needs: what the customer has in mind but

might not want to ask for ‘It’s not only the price, I want low running costs as well’

3.Unstated needs: what the customer expects,

especially in terms of service, but assumes will

be provided without having to ask for it he’s polite, he listens to me, I trust him

4.Delight needs: vaguely formed customer

expectations of ‘freebies’ that make the

customer happy he’s giving me the GPS for free!!!!

5.Secret needs: innermost and very personal

desires that are never explicitly expressed wait till my neighbors see this car!

words

thoughts

emotions

reactions

Related to the

product/service

value.

They have to be

fulfilled for the

exchange to take

place

Related to the

exchange

process. They

have to be fulfilled

to create

customer

satisfaction

dreams

Related to the

exchange and

post-purchase

experience.

They have to be

fulfilled to create

customer loyalty

Extension of the Five Types of Customer Needs

Determinants of

Customer Perceived Value

Image benefit Psychological cost

Personal benefit Energy cost

Services benefit Time cost

Product benefit Monetary cost

Total customer benefit Total customer cost

Customer

Perceived

Value

What is

customer perceived value?

Customer perceived value is the

difference between the prospective

customer’s evaluation of all the benefits

and all the costs of an offering and the

perceived alternatives.

The value proposition

The value proposition

consists of the

whole cluster of

benefits the

company promises

to deliver

Safety is a leading, but not the only, benefit promised in Volvo’s value proposition Source: Courtesy of Volvo Car Corporation / Agency: Arnold

How do buyers form their

expectations?

Expectations result from past buying

experience, friends’ and associates’ advice,

and marketers’ and competitors’ information

and promises.


What is Quality?

Quality is the totality of features and

characteristics of a product or

service that bear on its

ability to satisfy

stated or implied needs.


Measuring Customer Satisfaction

Periodic Surveys

Customer Loss Rate

Mystery Shoppers

Monitor competitive

performance

What is loyalty?

Loyalty is a deeply held

commitment

to re-buy or re-patronise a

preferred product or service in the

future

despite situational influences and

marketing efforts having the

potential to cause switching

behaviour.

What is customer relationship

management (CRM)?

CRM is the process of carefully managing

detailed information about individual

customers and all customer touchpoints to

maximise customer loyalty.


Framework for CRM

Identify prospects and customers

Differentiate customers by

their needs and

value to our company

Interact to improve knowledge

Customize for each customer

Figure 11.6 The customer-development process Source: J. Griffin (1995) Customer Loyalty: How to Earn It, How to Keep It, New York: Lexington Books, p. 36. See also M. Raphel and N. Raphel (1995) Up the Loyalty Ladder:

Turning Sometime Customers Into Full-Time Advocates of Your Business, New York: HarperBusiness

Figure 11.5 Customer-product profitability analysis


CRM Strategies to increase the

value of customer base

Reduce the rate of defection

Increase longevity

Enhance “share of wallet” ,

cross selling & up selling

Terminate low-profit

customers

Focus more effort on

high-profit customers

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