consumer

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CONSUMER BEHAVIOR
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Consumer behavior

• The term consumer behavior is defined as the
  behavior that consumers display in searching for,
  purchasing, using, evaluating and disposing of
  products and services that they expect will
  satisfy their needs.

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Difference between customers and consumers

• Every customer is a consumer but not every
  consumer a customer. Customer is one who is brand
  loyal, who has made a custom to purchase a
  particular company's product/services. thus
  customer is a sub set of consumer.
• One that consumes, especially one that acquires
  goods or services for direct use or ownership
  rather than for resale or use in production and
  manufacturing. A consumer is an end user.
• A customer One that buys goods or services. A
  customer can in turn resell to a consumer.

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• The central premise to understand consumer
  behavior People do not buy products or
  services, they buy benefits.
• Purchases are made not for the products
  themselves but for the problems they solve or the
  opportunities they create
• ? Consumer benefits are those positive factors
  that the consumer obtains as a result of the
  possession and/or use of a product or service

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Why We Study CB?

• Diverse Reasons -
• As Consumers
• As Marketers future Marketers
• As Students of Human Behavior

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Consumer Benefits

• Tangible Benefits measurable
• Intangible benefits associated with the
  feelings that you experience

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• Two different kinds of consuming entities
• Personal consumer
• Organizational consumer

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Personal Consumer

• The individual who buys goods and services for
  his or her own use, for household use, for the
  use of a family member, or for a friend.

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Organizational Consumer

• A business, government agency, or other
  institution (profit or nonprofit) that buys the
  goods, services, and/or equipment necessary for
  the organization to function.

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Development of the Marketing Concept
Production Concept
Product Concept
Selling Concept
Marketing Concept
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The Production Concept

• Assumes that consumers are interested primarily
  in product availability at low prices
• Marketing objectives
• Cheap, efficient production
• Intensive distribution
• Market expansion

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The Product Concept

• Assumes that consumers will buy the product that
  offers them the highest quality, the best
  performance, and the most features
• Marketing objectives
• Quality improvement
• Addition of features
• Tendency toward Marketing Myopia

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The Selling Concept

• Assumes that consumers are unlikely to buy a
  product unless they are aggressively persuaded to
  do so
• Marketing objectives
• Sell, sell, sell
• Lack of concern for customer needs and
  satisfaction

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The Marketing Concept

• Assumes that to be successful, a company must
  determine the needs and wants of specific target
  markets and deliver the desired satisfactions
  better than the competition
• Marketing objectives
• Profits through customer satisfaction

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The Marketing Concept

• A consumer-oriented philosophy that suggests
  that satisfaction of consumer needs provides the
  focus for product development and marketing
  strategy to enable the firm to meet its own
  organizational goals.

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• Marketing Concept is based on the premise that a
  marketer should make what it can sell, instead of
  trying to sell what it has made

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Implementing the Marketing Concept

• Consumer Research
• Segmentation
• Targeting
• Positioning

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Consumer Research

• The process and tools used to study consumer
  behavior.
• Two perspectives
• Positivist approach
• Interpretivist approach

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Segmentation, Targeting, and Positioning

• Segmentation process of dividing the market into
  subsets of consumers with common needs or
  characteristics
• Targeting selecting one ore more of the segments
  to pursue
• Positioning developing a distinct image for the
  product in the mind of the consumer

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Successful Positioning

• Communicating the benefits of the product, rather
  than its features

• Communicating a Unique Selling Proposition for
  the product

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The Marketing Mix

• Product
• Price
• Place
• Promotion

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Successful Relationships
Customer Value
Customer Retention
Customer Satisfaction
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Types of Customers

• Loyalists
• Apostles
• Defectors

• Terrorists
• Hostages
• Mercenaries

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Customer retention

• Makes it in the best interest of customers to
  stay with the company rather than switch to
  another firm
• Customers are grouped into four tiers
• The platinum tier heavy users, not price
  sensitive
• The gold tier Heavy users, not profitable, price
  sensitive
• The iron tier spending volume and profitability
  do not merit special treatment form the company
• The lead tier customers who actually cost the
  company by spreading negative word of mouth

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Ethics social responsibility

• All companies prosper when society prospers, many
  people believe that all of us, companies as well
  as individuals, would be better off if social
  responsibility were an integral part of every
  marketing decision.

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Societal Marketing Concept

• A revision of the traditional marketing concept
  that suggests that marketers adhere to principles
  of social responsibility in the marketing of
  their goods and services that is, they must
  endeavor to satisfy the needs and wants of their
  target markets in ways that preserve and enhance
  the well-being of consumers and society as a
  whole.

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The Societal Marketing Concept

• The societal marketing concept, advocates a long
  term perspective.
• It recognize that all companies would be better
  off in a stronger, healthier society, and that
  companies that incorporate ethical behavior and
  social responsibility in all of their business
  dealings and maintain loyal consumer support over
  the long run.

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Nature and characteristics of Indian consumer

• The Indian consumption patterns are slowly
  converging with global norms.
• The Indian consumer is now spending more on
  consumer durables, apparel, entertainment,
  vacations and lifestyle related activities.
• Entertainment, clothing and restaurant dining are
  categories that have been witnessing a maximum
  rise in consumer spending since 2002.

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• The rate of growth of spending on discretionary
  items (unlike basic necessities like food) has
  been growing at an average of 9 per cent per year
  over the past five years. A nation of savers,
  India, has now altered into a nation of spenders.

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Consumerism

• The movement seeking to protect and inform
  consumers by requiring such practices as honest
  packaging and advertising, product guarantees,
  and improved safety standards.
• Movement or policies aimed at regulating the
  products, services, methods, and standards of
  manufacturers, sellers, and advertisers in the
  interests of the buyer.

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Rights of consumers

• Right to safety
• Right to be informed
• Right to choose
• Right to be heard
• Right to seek redressal
• Right to consumer education

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Responsibilities of Consumers

• Responsibility of self-help
• Proof of Transactions
• Proper claim
• Proper use of Product/services