Unit 1 - Understanding consumer behavior Flashcards
What is Marketing?
creating, communicating & delivering offers that have value for customers, clients, partners & society.
Organisations, then, need to research about the needs, desires, expectations of their customers through different methodologies.
What is Consumer Behaviour?
The study of consumer’s choices during searching, evaluating, purchasing, and using products and services that they believe would satisfy their needs.
Marketing concept
- marketers satisfy consumer needs effectively by making only those products that consumers are likely to buy
- balance
- what the firm produces linked with the satisfaction of consumers’ needs
Marketing Myopia
Companies focus on the product itself rather than those consumers’ needs it presumes to satisfy.
- Careful: most unhappy buyers share their dissatisfaction with other consumers
- Example: Booking
- Example: Tripadvisor
marketing segmentation
- The process of dividing a market into subsets of consumers with common needs or characteristics.
- Each subset represents a consumer group with shared needs that are different from those shared by other groups.
targeting
selecting the segments that the company views as prospective customers and pursuing them with different offerings → strategy & planning
positioning (pt.1)
- process by which a company creates a distinct image & identity for its products, services, & brands in consumers’ minds
- image differentiates the company’s offering from competitors by communicating to the target audience that the product fulfils the target consumers’ needs better than alternatives
positioning (pt.2)
segmentation, targeting and positioning are implemented across the marketing mix components:
- product
- price
- place
- promotion
on Technology, Consumers and Marketers (pt.1)
- Transformation through innovation
- Value exchange: Consumers provide marketers with detailed personal information to become better informed, buy customized products and shop more efficiently.
on new trends in marketing & consumer behavior
o Transformation through innovation
o Machine learning
o Big data (field that treats ways to analyze, systematically extract information from big sets of data)
o Big Data Marketing
o Hyper-segmentation (advanced & real-time customization of offerings, content & customer experience at an individual level)
Sharing: personal information for more personalized offers
Machine Learning
- We love data
- We need machines to “learn” from consumers and offer them personalized options which connect with those things they like.
what is the new consumer (pt.1)
hard to attract, satisfy and retain
they look for information on the web
new marketers use the web & social media:
• Customize their offerings & promotional messages.
• Can offer effective pricing strategies.
• Shorten distribution channels.
What’s most important with new customers?
Design campaigns based on their customer’s experiences, desires, expectations…
And build long-term relationships with customers.
what is the new consumer (pt.2)
New consumer: difficult to surprise, attract, satisfy and retain.
Web and social media:
- Customize the approach to each type of consumer
- Competitive prices with more direct impact
- Cancelation of distribution channels
- Design of campaigns based on consumer tastes, expectations,
opinions, wishes…
The internet drastically improved
consumers’ access to the information they need…
But it also enables marketers to gather more precise data about consumers.
Cookies
Cookies: webpages store code left by users about the information they search.
• Online data enable data brokers and marketers to exchange information and allow data aggregators to track who is interested in the information ‘cookies’ store.
On Big Data Marketing
- To research their customers brands use digital technology
* Big Data Marketing: helps organisations to make decisions related to the company.
on Classifying consumers
Demographic items:
- Age
- Gender
- Marital Status
- Social class / incomes
- Race / ethnicity
- Geography
- Lifestyle
on interactive communications (Traditional Advertising VS Electronic Communications)
Traditional marketing→Evaluation:
Looking at sales
Post-purchase marketing
Research studies
Electronic communications→Evaluation: Two-way communications
Interactive exchange
Instant reaction to messages by consumers
There are two forms of customer engagement:
There are two forms of customer engagement:
- Emotional Bonds: customer’s commitment and attachment to the company
- Transactional Bonds: mechanics and structures that facilitate exchanges between consumers and sellers
Marketers use technology to build emotional bonds through social media.
Emotional bonds VS transactions
- the objective of discerning customers’ emotional & transactional motives when buying from a company is to understand the drivers of customer satisfaction which lead to customer retention & long-term relationships
determinants of customer satisfaction:
adaptation; interactivity; nurturing; commitment; network; assortment; transaction ease; engagement; loyalty; inertia; trust
kind of relationship with a product/service→SELF-CONCEPT ATTACHMENT
establishes user’s identity
kind of relationship with a product/service→NOSTALGIC ATTACHMENT
it links the user with a previous experience or memory
kind of relationship with a product/service→INTERDEPENDENCE
The product is part of the daily routine of the user
kind of relationship with a product/service→LOVE
the product establishes emotional links with the user
social media
means of interactions among people in which they create, share and exchange information & ideas in virtual communities and networks
marketers use social media to
create, co-create and share content with their fans & followers
Current environment
implies changes
New COVID situation:
- Less willingness to pay
- Higher consumption at home
- Growing concern for health
- Wish for little indulgences
- Explosion of online channels
- Bet on proximity stores
what is growth hacking
get new consumers or increase the number of current purchases with very limited investments
OBPPC
To OFFER the most appropriate BRAND for each consumption occasion, with the right PACK and PRICE, activating each CHANNEL in a specific way.
- the portfolio and price are optimized in addition to putting the consumer at the centre of the equation
- it allows a sales increasement and profits in various types of markets and companies in size
objective of growth hacking and OBPPC
to adapt and differentiate the portfolio, responding to each consumption occasion with a set of pack-price combinations that cover the different provisions to pay of buyers.
roles of growth hacking and OBPPC
- Trial - Recruitment of new consumers - Frequency - Generate higher frequency of consumption among current consumers - Upsize - Consume more every time - Upscale - Higher value products that increase your average spend
4 steps and questions to answer
- Occasions: Are there any consumption occasions that we are not covering? Are
there any new consumer trends that we are missing? - Brands: which brands from our portfolio can be used to cover different consumption occasions? Can we expand our brands with credibility to those new occasions and consumers?
- Pack and Price: do we cover all the necessary roles with our portfolio? Can we recruit new consumers, retain current ones and get them to increase their spending? Is our pricing strategy between products consistent?
- Channels: how can we capture the trends present in each channel? Can we differentiate our portfolio by channel?
Social Responsibility and Ethics
- requires marketers to fulfil the needs of the target audience in ways that improve, preserve and enhance society’s well being while simultaneously meeting their business objectives
- many companies have incorporated social goals into their mission statements and believe that marketing ethics and social responsibility are important components of organizational effectiveness
- perceptions of a company’s lack of social responsibility or unethical marketing strategies negatively affect consumer purchase decisions
