M1 Flashcards
original use and features of crocs
boating shoe- grip soles, waterproof, toe protection, easy on and off, and ventilation holes for drying
How did the shoes get the name crocs?
designed to work on land and out in the water
also look like a crocodile head from the side
what is the just noticeable difference threshold and its significance in logo changes?
how to market crocs? they’re so ugly
attempt to expand customer base by offering more types of products (shirts, hats, sunglasses, garden knee pads - but people didn’t buy)
eventually had 9 clog models in 17 colors
what was crocs first marketing campaign? with who?
ugly can be beautiful
jonathan shoenberg from TD advertising and designs
he wore the shoes while traveling and they caught peoples’ eyes - “those are so ugly; where can i get a pair?”
they were so ugly they got your attention whether you liked it or not
how did jibbitz start and how did they help crocs?
started as parents decorating their kids crocs with charms (sheri and rich schmelzer)
allowed for mass personalization- made crocs bespoke (custom)
clogs started to go out of style; how did crocs make them relevant again?
1) authentic collabs with celebrities and companies (KFC and hidden valley) also adds new segments - their fans
got younger generation hooked in hopes that older generation would follow
limited edition creates scarcity mindset so people buy quickly
2) come as you are campaign
included diverse bunch of celebrities who all love crocs
crocs has a perfect shoe for everyone
how did covid 19 actually help crocs?
people didn’t care how they looked since they were working from home - started prioritizing comfort
crocs are easy to clean
crocs donated shoes to healthcare workers - made themselves known for doing good for the community
downsides of a niche consumer base
requires more research on what consumers want
less potential buyers but also less competition
features of crocs shoes that helped them expand their consumer base
comfortable and easy to clean –> attracted hospital workers, servers, etc
were also approved by medical organization for people with diabetes
how can knock-offs hurt the real brand?
from a distance, other people cannot tell if it’s real or fake, but they can tell if it looks worn or low quality
they might then believe that the real crocs brand is low quality when in reality they saw a person wearing croc dupes that were falling apart
are we always consuming?
yes, we are always consuming space, air, time, clothes, buildings, furniture, etc
consuming can also be thinking about a past or future purchase
what is the poverty tax
the idea that lower SES people end up paying a greater cost for goods because they don’t have the luxury of buying high quality up front and having that product last a lifetime
they have to keep buying cheaper replacements which adds up
what is the difference between a need and a want
need: discomforting human condition which must be perceived by the self (can be physical or mental)
a want is a desire for a specific object or product - can be a solution to a need
what is the ultimate marketing goal?
create consumer value and satisfaction
importance of picking a price for a product
influences consumer value - how much they think the product should perform, how long it should last, the quality, etc
very easy to disappoint the consumer by picking a high price
what are the 4 P’s?
price
place
promotion
product
what are price’s tools?
list price, discounts, payment plans, credit terms
what are product’s tools?
variety, quality, design, brand name, packaging
what are promotion’s tools?
ads, personal selling, sales promotion, PR
what are place’s tools?
channels, coverage, inventory, logistics, assortments, transportation
3 reasons to study consumer behavior
1) improve business performance: anticipate customer needs via specific marketing strategies
2) influence public policy: improve society’s wellbeing (ex. warnings to take birth control on accutane; FDA nutrition label requirements)
3) help consumers make better decisions via social marketing: educate people about destructive habits/products, promote good behaviors (ex. educate on how to read nutrition labels)
what are the 3 essentials of consumer behavior?
1) exchange: between parties - each gives up something of lesser value for something of greater value
2) resources: time, knowledge, energy, social capital (can use money in place of any of these)
3) value: total net benefits we get from an exchange - is the underlying goal of all exchanges - value is conveyed when a consumer’s need is met
what are the different types of value? 4 and they are not mutually exclusive
1) utility/functionality: does the product do what you expected?
2) social: does the product help you maintain social relationships? maintain a positive image?
3) ego/identity: does the product help you build or convey your identity or align with what you believe in?
4) recreation/hedonism: does the product put you in a good mood?
what is the difference between value and delight
value: a consumer’s overall rating of the product’s utility based on the costs and benefits
delight: exceeding a consumer’s expected net gains (value) and it gets them to come back
reason for naming the brand lululemon
the letter L is not pronounced in japan - the presence of L’s indicates that the brand is American and of high status
how did chip wilson delight consumers with lululemon
consumers expected them to be more form-fitting than their previous yoga clothes but were surprised about the sweat-wicking properties
what are two reasons for humans’ excessive consumption
1) need to stimulate our larger brains
2) other animals don’t have prestige (giving status to others without earning it through competition/dominance behaviors) - we use products to signal status
what happens to male consumption when they are looking for a mate?
it becomes more conspicuous - more obvious - they want to signal that they have money
how do status and shame drive consumption?
fear of being judged negatively by peers (and having them think you’re low status) may cause people to purchase things to improve their perceived status
people differentiated between store-bought and homemade clothes around the industrial revolution
argument that marketing does not cause needs
argument that marketing does cause needs
do things actually get used after they’re bought
no, only 1% of materials are in use 6 months after sale
what are planned and perceived obsolescence and what problem do they cause
planned is when the manufacturer designs the product to stop working at a certain point, forcing the customer to buy a new one
perceived is when the consumer feels like the product has gone out of style so they want to buy the newest version
problem: dilemma of the commons - what these people/consumers think is good for them (always buying the newest version or making consumers by the newest version) is bad for the environment which negatively impacts everyone else
ways to lower your carbon footprint
buy from companies that source materials responsibly
buy less or buy things you will actually use
eat less meat
use less single-use plastics
buy quality not fast fashion
why do we need to do market research?
so companies produce what consumers actually want, not what the company thinks they want
to decrease the risk of a product not selling well
what are basic and applied market research
basic: look for general relationships/trends between variables - no specific situations - can be used to advance a general theory
applied: looks at one relationship in a specific situation - trying to address a specific problem/goal
why did “new coke” not do well?
coke felt threatened by pepsi - people preferred pepsi in blind taste tests and coke believed it was because pepsi was sweeter so they changed the coke formula
people didn’t like the new coke - they didn’t like the taste and the new name/label disrupted their emotional connection/identity with the original coke
what are the 2 main distinctions in types of research methods
primary vs secondary: was it done by you, or are you collecting data that other researchers already had
qualitative vs quantitative: are you observing how specific groups of people behave in certain situations, or getting numbers from large surveys to determine correlation and causation
do qualitative first (more expensive) and use qualitative to inform quantitative
types of research methods by goal
exploratory
1) focus groups
2) in-depth interviews
3) projective tests
4) observation
descriptive
1) longitudinal studies
2) surveys
correlational/causal
1) correlational
2) causal experiments
key points of focus groups
8-12 people discussing a product, advertisement, etc
moderator to prevent groupthink
group is intentionally biased to fit the situation/product
question order matters: general before specific, behavior before attitude, positive before negative, unaided before aided
key points of in-depth interviews
one-on-one with an interviewer for an hour+
may cover sensitive topics not easily discussed in group settings
establish rapport and trust
tims consuming and expensive
key points of projective tests
person projects their underlying thoughts/feelings about a product onto an ambiguous stimulus
subject to bias from interpreter
can get consumer insight on sensitive/uncomfortable topics
key points of observation
obtrusive and unobtrusive
people may act different if they know they are being watched
can observe actual behavior but don’t know consumer’s thoughts
can be hard/subjective to score
key points of longitudinal studies
follow a group of people over time
true panel: repeated measures of the same variables each time
omnibus panel: using different measures and variables over the time period
expensive and possible attrition (need to make sure there aren’t any systemic similarities between people that drop out)
key points of surveys
self-selection bias
useful for getting info from a large group
potential bias from interviewer, question wording, and social desireability
key points of correlations
tells you if variables are associated but cannot tell you the direction of association (cause)
make use of natural groups
allows for study of variables that would otherwise be unethical or impossible
key points of causal experiments
2 requirements:
1) random assignment to control or experimental groups means any difference between groups has to be because of the treatment (change in independent variable)
2) manipulation of one or more variable (independent variables)
type I error - false positive
type II error - false neg
purpose of segmentation
tailor marketing and products to manipulate peoples’ spending and increase efficiency and profit
what did orbitz do differently for mac and PC users and why
showed mac users more upscale hotels (4 and 5 stars) and higher priced rooms with more amenities
they did this since mac users were already likely to spend $20-30 more on a room per night and more likely to choose a 4-5 start hotel
showed the consumer options they liked and got more money
what’s the compromise effect
people buy the middle priced option so you can get them to spend more by changing the anchor prices
aggregation
type of segmentation that uses undifferentiated mass marketing
used in rare cases where consumer satisfaction doesn’t matter, where all consumers have an equal need for a product, in small markets where further dividing the population would not be profitable
pros and cons of aggregation
pros: economical - don’t have to do a lot of research because you’re not tailoring the product to a segment
cons: inefficient and ineffective if customer satisfaction is an important factor
market segmentation
tailoring marketing and products to a subgroup of the population that has different behaviors, needs, etc
2 assumptions underlying segmenting
1) preference heterogeneity - not every consumer has the same desires
2) by tailoring your marketing strategy to fit a certain group of people, you can make the product appealing enough to offset the cost of the market research
pros of segmenting
reveals opportunities for a company to make a new product targeted at a specific segment (find segments with unmet needs or wants)
increased consumer satisfaction (one size fits all doesn’t truly satisfy anyone)
convenient for the consumer (showing them ads of things they like)
4 steps of segmentation
1) identify product related need sets (what needs are unmet) - can use top down or bottom up (specific to general or general to specific)
2) group consumers with similar need sets - do concept testing to see how these consumers react to the product idea
3) describe each group - you have consumers with a similar need set but what else is similar among them? (demographic, geographic, psychographic, behavior, benefits sought)
4) select segment(s) to serve - need at least 3 of the 6 points to be profitable
points that make a segment attractive
1) identifiable with clear distinctions between other segments
2) substantial size where there are enough consumers to profit
3) accessible and able to reach for advertising
4) stable and able to turn a profit over a long period of time
5) differentiable from other segments
6) actionable and able to create products and marketing campaigns for the people in that segment
2 key demographics
population size and distribution
occupation (reflects income, education, impacts lifestyle)
gendered marketing
women end up paying more
allows brands to sell more and charge more (instead of buying one type of soap, buy men’s and women’s soap but the women’s costs more)
what is gender contamination
when a product becomes so associated with one gender that the other gender won’t buy it - often need to hypermasculize products associated with women to tell men it’s okay for them to buy it
what is the pink tax and has legislation against it been successful?
pink tax is the idea that women pay more for toys and personal care products
it’s hard to implement laws because products must contain the same ingredients, have the same intended use, have the same features, and have the same design - the only difference being color/gender
which states have pink tax legislation
CA pink tax law 2023, NY banned pink tax in 2020, CA req same prices at salons and dry cleaners
what is majority fallacy
going after the biggest, most appealing segment might not be the best option since it will also have the most competition (targeting the same segment as the majority)
what is cannibalization
products within the same company compete against each other
ex) old navy, GAP, banana republic are clothing stores owned by the same company - but each has different price ranges so they are geared toward slightly different segments
