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Title: 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
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