Consumer Behavior Chapter 1

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Chapter 1Consumers Rule
By Michael R. Solomon
Consumer Behavior Buying, Having, and Being
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What is Consumer Behavior?

• Consumer Behavior
• The study of the processes involved when
  individuals or groups select, purchase, use, or
  dispose of products, services, ideas, or
  experiences to satisfy needs and desires
• Role Theory
• Identifies consumers as actors on the marketplace
  stage
• Consumer Behavior is a Process
• Exchange A transaction in which two or more
  organizations give and receive something of value

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Some Issues That Arise During Stages in the
Consumption Process
Figure 1.1
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Consumers Impact onMarketing Strategy

• Market Segmentation
• Identifies groups of consumers who are similar to
  one another in one or more ways and then devises
  marketing strategies that appeal to one or more
  groups
• Demographics
• Statistics that measure observable aspects of a
  population
• Ex. Age, Gender, Family Structure, Social Class
  and Income, Race and Ethnicity, Lifestyle, and
  Geography

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A Lesson Learned

• Nike was forced to pull this advertisement for a
  running shoe after disabilities rights groups
  claimed the ads were offensive.
• How could Nike have done a better job of getting
  its message across without offending a powerful
  demographic?

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Market Segmentation

• Finely-tuned marketing
• segmentation strategies
• allow marketers to
• reach only those
• consumers likely to be
• interested in buying
• their products.

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Consumers Impact onMarketing Strategy (cont.)

• Relationship Marketing Building Bonds with
  Consumers
• Relationship marketing
• The strategic perspective that stresses the
  long-term, human side of buyer-seller
  interactions
• Database marketing
• Tracking consumers buying habits very closely,
  and then crafting products and messages tailored
  precisely to peoples wants and needs based on
  this information

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Marketings Impact on Consumers

• Marketing and Culture
• Popular Culture
• Music, movies, sports, books, celebrities, and
  other forms of entertainment consumed by the mass
  market.

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Popular Culture

• Companies often create product icons to develop
  an
• identity for their products. Many made-up
  creatures and
• personalities, such as Commander Safeguard etc,
  which are widely recognized figures in popular
  culture.

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Consumer Behavior InvolvesMany Different Actors

• Consumer
• A person who identifies a need or desire, makes a
  purchase, and then disposes of the product
• Many people may be involved in this sequence of
  events.
• Purchaser / User / Influencer
• Consumers may take the form of organizations or
  groups.

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VDO AD

• vdos\Commander Safeguard Complete 5 Part 1
  www1.keepvid.com.mp4

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Popular Culture
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VDO ADS

• vdos\pepsi call.mp4
• vdos\walls noori.mp4

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• Marketers play a significant role in our view of
  the world and how we live in it.

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Marketings Impact on Consumers The Meaning of
Consumption

• The Meaning of Consumption
• People often buy products not for what they do,
  but for what they mean.
• Types of relationships a person may have with a
  product
• Self-concept attachment
• Nostalgic attachment
• Interdependence
• Love

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VDO AD

• vdos\Coke ad (Coke and Meal, Part1)
  www1.keepvid.com.mp4

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Discussion Question

• What kind of statement does the Nike Swoosh make?

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Discussion Question
Discussion Question
Discussion Question
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Marketings Impact on Consumers The Meaning of
Consumption (cont.)

• Consumption includes intangible experiences,
  ideas and services in addition to tangible
  objects.

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Marketings Impact on Consumers The Global
Consumer

• By 2006, the majority of people on earth will
  live in urban centers.
• Sophisticated marketing strategies contribute to
  a global consumer culture.
• Even smaller companies look to expand overseas.

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The Global Consumer

• American products like Levi jeans are in
• demand around the world.

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The Global Consumer
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Marketings Impact on Consumers Virtual
Consumption

• The Digital Revolution is one of the most
  significant influences on consumer behavior.
• Electronic marketing increases convenience by
  breaking down the barriers of time and location.
• U-commerce
• The use of ubiquitous networks that will slowly
  but surely become part of us (i.e., wearable
  computers, customized advertisements beamed to
  cell phones, etc.)
• Cyberspace has created a revolution in C2C
  (consumer-to-consumer) activity.

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Virtual Brand Communities
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Blurred BoundariesMarketing and Reality

• Marketers and consumers coexist in a complicated
  two-way relationship.
• Its increasingly difficult for consumers to
  discern the boundary between the fabricated world
  and reality.
• Marketing influences both popular culture and
  consumer perceptions of reality.

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Blurred Boundaries

• Marketing managers
• often borrow imagery
• from other forms of
• popular culture to
• connect with an
• audience. This line of
• syrups adapts the look
• of a pulp detective
• novel.

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Marketing Ethics and Public Policy

• Business Ethics
• Rules of conduct that guide actions in the
  marketplace
• The standards against which most people in the
  culture judge what is right and what is wrong,
  good or bad
• Notions of right and wrong differ among people,
  organizations, and cultures.

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Needs and WantsDo Marketers Manipulate
Consumers?

• Consumerspace
• Do marketers create artificial needs?
• Need A basic biological motive
• Want One way that society has taught us that
  need can be satisfied
• Are advertising and marketing necessary?
• Economics of information perspective Advertising
  is an important source of consumer information.
• Do marketers promise miracles?
• Advertisers simply dont know enough to
  manipulate people.

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Discussion Question

• This ad was created to counter charges that ads
  create artificial needs.
• Do you agree with the premise of the ad? Why or
  why not?

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Consumerism

• Culture Jamming
• A strategy to disrupt efforts by the corporate
  world to dominate our cultural landscape

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Culture Jamming

• Adbusters Quarterly is a Canadian magazine
  devoted to culture jamming. This mock ad skewers
  Benetton.

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Consumerism and Consumer Research

• Green Marketing
• When a firm chooses to protect or enhance the
  natural environment as it goes about its
  activities
• Reducing wasteful packaging
• Donations to charity
• Social Marketing
• Using marketing techniques to encourage positive
  activities (e.g. literacy) and to discourage
  negative activities (e.g. drunk driving)

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Consumer Related Issues

• UNICEF sponsored this advertising campaign
  against child labor. The field of consumer
  behavior plays a role in addressing important
  consumer issues such as child exploitation.

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The Dark Side of Consumer Behavior

• Consumer Terrorism
• An example Susceptibility of the nations food
  supply to bioterrorism
• Addictive Consumption
• Consumer addiction
• A physiological and/or psychological dependency
  on products or services
• Compulsive Consumption
• Repetitive shopping as an antidote to tension,
  anxiety, depression, or boredom

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The Dark Side of Consumer Behavior (cont.)

• Consumed Consumers
• People who are used or exploited, willingly or
  not, for commercial gain in the marketplace
• Illegal Activities
• Consumer Theft
• Shrinkage The industry term for inventory and
  cash losses from shoplifting and employee theft
• Anticonsumption
• Events in which products and services are
  deliberately defaced or mutilated

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Consumer BehaviorAs a Field of Study

• Consumer behavior only recently a formal field of
  study
• Interdisciplinary influences on the study of
  consumer behavior
• Consumer behavior studied by researchers from
  diverse backgrounds
• Consumer phenomena can be studied in different
  ways and on different levels

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The Wheel of Consumer Behavior
Figure 1.3