Customer Analysis

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Customer Analysis
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7 Os of Consumer Behavior

• Occupants. Who constitutes the market?
• Objects. What does the market buy?
• Objectives. Why does the market buy?
• Organizations. Who participates in the buying?
• Operations. How does the market buy?
• Occasions. When does the market buy?
• Outlets. Where does the market buy?

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Quickly identify the 7 Os of Consumer Behavior
For

• Baby diapers
• Friday nights entertainment
• Pizza
• Resort hotels
• Intercity transportation (mainland)
• Dishwashing equipment

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Model of Buyer Behavior
Buyers Charact-eristics
Buyers Decision Process
Buyers Decisions
Marketing Stimuli
Other Stimuli
Product Price Place Promo- tion
Econ Tech Political Cultural Compet- ition
Cultural Social Personal Psycho- logical
Problem Search Evaluate Decision Post- purchase
Product choice Brand choice Dealer
choice Purchase timing Purchase amount
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ConsumerBuying Decision Process
Problem Recognition
Information Search
Evaluation of Alternatives
Purchase
Post-Purchase
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Successive Sets Involved in Consumer Decision
Making
Total Set
Awareness Set (Evoked Set)
Consideration Set
Choice Set
Decision
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Four Types of Buying Behavior
Complex Buying Behavior
Variety- Seeking Behavior
High Involvement
Low Involvement
Dissonance- Reducing Buying Behavior
Habitual Buying Behavior
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Postpurchase Evaluation

• Customer Satisfaction.
• Based on perception of quality and
  customers expectations.
• Cognitive Dissonance.
• Buyers remorse, followed by justification.

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Possible influences on the decision process

• Psychological
• Perception
• Motives
• Learning
• Attitudes
• Personality

• Social
• Roles/ family
• Reference groups/
• opinion leaders
• Social class
• Culture,subculture

• Personal
• Demographic
• Lifestyle
• Situational

Consumer buying decision process
Problem recognition
Information search
Evaluation of alternatives
Purchase
Postpurchase evaluation
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Demographic

• Age
• Gender
• Race
• Income
• Education
• Religion
• Ethnicity
• Size

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Lifestyle
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Situational Factors

• Time pressures
• Product scarcity
• Weather
• Use occasion
• Buying purpose (self, gift for others, etc.)

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Perception

• The process of selecting, organizing, and
  interpreting information inputs to produce
  meaning.
• Selective Exposure. Individuals select some
  pieces of information and ignore others.

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Selective Perception

• Selective Distortion. Changing or twisting
  currently received information.
• Selective Retention. When people remember
  information inputs that support their feelings
  and beliefs, forget inputs that do not.

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Motives

• Something that moves a buyer to action to satisfy
  a need or achieve a goal.
• At any one time we may be motivated by more than
  one motive, but some are stronger than others.

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Maslows Hierarchy of Needs
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Information
Learning
Experience
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Attitude

• A lasting, general evaluation of something
  (people, objects, or issues).
• Three components of an attitude, or the ABCs of
  Attitude
• Affect (Feelings)
• Behavior
• Cognition (Thoughts)

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Personality

• A persons distinguishing psychological
  characteristics that lead to relatively
  consistent and enduring responses to his or her
  environment.
• Self-confidence Sociability
• Dominance Defensiveness
• Autonomy Adaptability
• Deference

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Self-Concept

• Actual Self-Concept. How she views herself
• Ideal Self-Concept. How she would like to view
  herself.
• Others-self-concept (looking glass self). How
  she thinks others see her.

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Family Decision-Making Processes

• Autonomic. Decision made by either/or
• Husband-dominant
• Wife-dominant
• Children-dominant
• Syncratic. Decision made jointly.

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• Lawn mower
• Car
• House
• Furniture
• Family vacation
• Breakfast cereal
• Life insurance
• Movie
• Soft drinks
• Drapes
• Home computer

• Autonomic
• Husband-dominant
• Wife-dominant
• Children-dominant
• Syncratic

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The Family Life Cycle

• 1. Bachelor Stage.
• 2. Newly married. Young. No children.
• 3. Full Nest I. Youngest child under six.
• 4. Full Nest II. Youngest child over six.
• 5. Full Nest III. Older married couples with
  dependent children.

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The Family Life Cycle

• 6. Empty Nest I. Older married couples, no
  children living with them. Head of household in
  labor force.
• 7. Empty Nest II. Older married. No children
  living at home. Head of house retired.
• 8. Solitary survivor, in labor force.
• 9. Solitary survivor, retired.

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Reference Groups

• All the groups that have a direct (face-to-face)
  or indirect influence on a persons attitudes or
  behavior.

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Reference Groups

• Membership Reference Group
• Aspirational Reference Group
• Disassociative Reference Group
• Opinion Leader. Viewed by others in group as
  well-informed. Provides information.

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Social Classes

• Relatively homogeneous and enduring divisions in
  a society, which are hierarchically ordered and
  whose members share similar values, interests,
  and behavior.

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The American Class Structure
UPPER AMERICANS Upper-Upper (0.3) The
Old Rich Lower-Upper (1.2) The Nouveau
Riche Upper-Middle (12.5) Professionals,
managers
MIDDLE AMERICANS Middle-Class
(32) White-collar workers Working Class
(38) Blue-collar workers
LOWER AMERICANS Lower Class (9) Working,
but poor Lowest Class (7) Welfare,
unemployed.
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Social Class Criteria

• Occupation
• Education
• Income
• Wealth
• Possessions
• Neighborhood

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VALS 2 Frame- work
High Resources
Actualizers
Fulfilleds
Experiencers
Achievers
Strivers
Makers
Believers
Low Resources
Strugglers
Principle Oriented
Action Oriented
Status Oriented
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VALS 2 Groups -High Resources

• Actualizers. Successful, sophisticated, active,
  take-charge. Cultivated tastes for relatively
  upscale, niche-oriented products.
• Fulfilleds. Mature, satisfied, comfortable.
  Favor durability, functionality, value.
• Achievers. Successful, career-oriented.
  Established, prestige products that demonstrate
  success to peers.
• Experiencers. Young, vital, enthusiastic,
  impulsive, rebellious. Clothes, fast food,
  music.

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VALS 2 Groups- Low Resources

• Believers. Conservative, conventional,
  tradition. Familiar products, established
  brands.
• Strivers. Uncertain, insecure, approval-seeking,
  resource constrained. Stylish products that
  emulate those with greater wealth.
• Makers. Practical, self-sufficient, traditional,
  family-oriented. Practical, functional products.
  Tools, utility vehicles, fishing, hunting, etc.
• Strugglers. Elderly, resigned, passive,
  concerned. Cautious, brand loyal.

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Business and Organizational Buying Behavior
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Business Buyers vs. Consumers

• Fewer buyers
• Larger buyers
• Close supplier-customer relationships
• Geographically concentrated buyers
• Derived demand. Demand derived from ultimate
  purchasers.
• Inelastic demand.
• Professional purchasing.
• Several buying influencers. Buying center.

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Primary Concerns of Organizational Buyers

• Quality. Meets specifications
• Service.
• Price (Cost).
• In short, the bottom line.
• Reverse marketing. Developing close
  relationships so that buyer controls the supplier.

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Major Influences on Industrial Buying
Behavior

• Environ-
• mental
• Demand
• Economic
• outlook
• Interest rate
• Techno-
• logical
• change
• Political
• Regulations
• Competition
• Social
• Response

• Organi-
• zational
• Objectives
• Policies
• Procedures
• Resources
• Systems

• Inter-
• personal
• Interests
• Authority
• Status
• Empathy
• Persuas-
• iveness

• Indivi-
• dual
• Age
• Income
• Education
• Position
• Risk

Business Buyer
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Organizational Factors
Purchasing- Department Upgrading
Cross- Functional Roles
Centralized Purchasing
Decentralized Purchasing of Small Ticket Items
Internet Purchasing
Long-Term Contracts
Purchasing- Performance Evaluation Pro. Buyers
Lean Production
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The Buying Center

• The group of people within an organization who
  are involved in making organizational purchase
  decisions.
• Includes users, influencers, buyers, deciders,
  gatekeepers, initiators, approvers.

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Participants in the Business Buying Process
Users
Initiators
Influencers
Gatekeepers
Buyers
Deciders
Approvers
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• Users. People who actually use the product.
  Often initiate the buying process.
• Influencers. Technical personnel, such as
  engineers or consultants.
• Buyers. Their job is to buy. Select suppliers,
  negotiate terms. Purchasing agents.
• Deciders. People who decide on product
  requirements or on suppliers.
• Gatekeepers. Control the flow of information and
  access to other members of the buying center
  (e.g., secretaries, receptionists)

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• Initiators. Those who request that something be
  purchased. They may be users or others in the
  organization.
• Approvers. People who authorize the proposed
  actions of deciders or buyers.