Consumer Behavior you are what you buy …

1. Consumer Behavior you are what you buy…

2. Consumer Buying Behavior • Consumer Buying Behavior refers to the buying behavior of final consumers (individuals & households) who buy goods and services for personal consumption.

3. Need Recognition Information Search Cultural, Social, Individual and Psychological Factors affect all steps Evaluation of Alternatives Purchase Postpurchase Behavior Consumer Decision-Making Process

4. Decision Processing

5. Buyer Behavior Other people often influence a consumers purchase decision. The marketer needs to know which people are involved in the buying decision and what role each person plays, so that marketing strategies can also be aimed at these people. (Kotler et al, 1994). • Initiator: the person who first suggests or thinks of the idea of buying a particular product or service. • Influencer: a person whose views or advice carry weight in making the final buying decision • Decider: the person who ultimately makes the final buying decision or any part of it • Buyer: the person who makes the actual purchase • User: the person who consumes the product or service Note: teens are increasingly assuming more of these roles Think about your past purchase– who was in which role?

6. Market Segmentation, Targeting, and Positioning

7. Chapter Objectives • Identify the essential components of a market. • Outline the role of market segmentation in developing a marketing strategy. • Describe the criteria necessary for effective segmentation. • Explain each of the four bases for segmenting consumer markets. • Identify the steps in the market segmentation process. • Discuss four basic strategies for reaching target markets. • Summarize the types of positioning strategies. • Explain the reasons for positioning and repositioning products.

8. Selecting a Target Market • Before a marketing mix strategy can be implemented, the marketer must identify, evaluate, and select a target market. • Market:people or institutions with sufficient purchasing power, authority, and willingness to buy • Target market: specific segment of consumers most likely to purchase a particular product

9. Types of Markets • Consumer products:goods or services purchased by an ultimate consumer for personal use • Business products:goods or services purchased for use either directly or indirectly in the production of other goods and services for resale • The key to classification is to identify the purchaser and the reasons for buying the goods.

10. The Role of Market Segmentation • Market SegmentationDivision of the total market into smaller, relatively homogeneous groups • No single marketing mix can satisfy everyone. Therefore, separate marketing mixes should be used for different market segments.

11. No Market Segmentation

12. Segmented by Sex

13. Segmented by Age

14. Criteria for Effective Segmentation • Market segmentation cannot be used in all cases. To be effective, segmentation must meet the following basic requirements. • The market segments must be measurable in terms of both purchasing power and size. • Marketers must be able to effectively promote to and serve a market segment. • Market segments must be sufficiently large to be potentially profitable. • The number of segments must match the firm’s capabilities.

15. Segmenting Consumer Markets • Geographic Segmentation: Dividing an overall market into homogeneous groups on the basis of their locations • Does not ensure that all consumers in a location will make the same buying decision. • Help in identifying some general patterns.

16. Using Geographic Segmentation • Demand for some goods and services can vary according to the geographic region • Most major brands get 40-80 percent of their sales from what are called core regions • Climate is another important segmentation factor • Northern consumers, for example, eat more soup than Southerners • Southerners use more chlorine for their swimming pools than Northern residents

17. Segmenting Consumer Markets • Demographic Segmentation:dividing consumer groups according to characteristics such as sex, age, income, occupation, education, household size, and stage in the family life cycle • A primary source for demographic data in the United States is the Census Bureau

18. Segmenting by Gender • Marketers must ensure that traditional assumptions are not false • Recently, the lines have increasingly blurred • Some companies market successfully to both genders

19. Segmenting by Age • Identify market segments on the basis of age • Products designed to meet the specific needs of certain age groups

20. Teens • Rapidly growing market • Significant purchasing power • Cohert Effect • Tendency among members of a generation to be influenced and drawn together by significant events occurring during their key formative years, roughly 17 to 22 years of age

21. Baby Boomers • Born from 1946 until 1965 • Nearly 42 percent of U.S. adults • Values influenced both by the Vietnam War and the career-driven era • Huge disposable income • Seniors • By 2025, 1 in 5 over age 65 • Median age is now 35.2 years • Life expectancy 74 for men and 79 for women • Heads of households aged 55-plus control about three-quarters of the country’s total financial assets.

22. Segmenting by Ethnic Group • By 2050, nearly half of the population of the US will belong to nonwhite minority groups. • Hispanic • African Americans • Asian Americans • Native Americans • People of Mixed Race

23. Family Life Cycle Stages Segmentation • The process of family formation and dissolution • Life stage, not age, is the primary determinant of many consumer purchases • Segmenting by Household Type • Today’s U.S. households are very diverse • Married couples and their children • Blended by divorce or loss of spouse • Headed by single parent, same-sex parents, grandparents

24. Segmenting by Income and Expenditure Patterns • Engel’s Laws,as family income increases: • A smaller percentage of expenditures go for food • The percentage spent on housing and household operations and clothing remains constant • The percentage spent on other items (such as recreation and education) increases

25. Demographic Segmentation Abroad • Obtaining the data necessary for global demographic segmentation is often difficult • Many countries do not operate regularly scheduled census programs • For example, the most recent census of Holland is now over 20 years old, and Germany skipped its census from 1970 to 1987 • Daily life cycle data is difficult to apply in global demographic segmentation efforts

26. Psychographic Segmentation • Divides a population into groups that have similar psychological characteristics, values, and lifestyles • Lifestyle: people’s decisions about how to live their daily lives, including family, job, social, and consumer activities • The most common method for developing psychographic profiles of a population is to conduct a large-scale survey • AIO statements • VALS and VALS 2 “Values and Lifestyles”

28. Using Psychographic Segmentation • Psychographic profiles produce rich descriptions of potential target markets • Greater detail aids in matching a company’s image and its offerings with the types of consumers who are likely purchasers

29. Product-Related SegmentationDividing a consumer population into homogeneous groups based on characteristics of their relationships to the product • Can take the form of segmenting based on: • Benefits that people seek when they buy • Usage rates for a product • Consumers’ brand loyalty toward a product

30. Benefits • Focuses on the attributes that people seek in a good or service and the benefits that they expect to receive from that good or service • Groups consumers into segments based on what they want a product to do for them • Usage Rates • Segmenting by grouping people according to the amounts of a product that they buy and use • Markets often divided into heavy-user, moderate-user, and light-user segments

31. Brand Loyalty • Segmenting consumers grouped according to the strength of brand loyalty felt toward a product • Frequent flyer programs of airlines and many hotels

32. Using Multiple Segmentation Bases • Increase accuracy in reaching the right markets • Combine multiple bases • Geographic and Demographic • Product-related with income and expenditure patterns • Others

33. The Market Segmentation Process • Develop a Relevant Profile for each Segment • Forecast Market Potential • Forecast Probable Market Share • Select Specific Market Segments

34. CRITICAL DISCUSSION • Apakah gaya hidup Anda berbeda secara significan dari orang tua Anda? • Jika ya, bagaimana perbedaan keduanya? • Faktor apa saja yg menyebabkan perbedaan tsb?

35. DISCUSSION • Anda adalah brand manager produk terbaru mobile phone. • Jelaskan bagaimana dgn pemahaman consumer behavior itu berguna dalam membuat market segmentation strategy produk Anda?

36. TARGET MARKET

37. Strategies for ReachingTarget Markets • Undifferentiated Marketing: when a firm produces only one product or product line and promotes it to all customers with a single marketing mix • Differentiated Marketing: when a firm produces numerous products and promotes them with a different marketing mix designed to satisfy smaller segments

38. Concentrated Marketing (niche marketing): when a firm commits all of its marketing resources to serve a single market segment • Micromarketing: involves targeting potential customers at a very basic level, such as by ZIP code, specific occupation, lifestyle, or individual household

39. Selecting and Executing a Strategy • No single, best choice strategy suits all firms • Determinants of a market-specific strategy: • Company resources • Product homogeneity • Stage in the product life-cycle • Competitors’ strategy

40. POSITIONING

41. Positioning: a marketing strategy that emphasizes serving a specific market segment by achieving a certain position in buyers’ minds • Attributes • Price/quality • Competitors • Application • Product user • Product class

42. Positioning mapGraphic illustration that shows differences in consumers’ perceptions of competing products • RepositionMarketing strategy to change the position of its product in consumers’ minds relative to the positions of competing products

43. Hypothetical Competitive Positioning Map for Selected Retailers

44. Assignment • Jelaskan sekilas profile Project anda • Tulis dan jelaskan Marketing Mix (4Ps) project anda • Gambarkan STP dan Marketing Strategic dari project anda.