Introduction: The Impact of the Digital Revolution on Consumer Behavior

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• Introduction The Impact of the Digital
  Revolution on Consumer Behavior

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OpeningVignette
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Objectives of One-to-One Marketing

• To attain customers
• Sell them more products
• Make a profit

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Digital Revolution in the Marketplace

• Allows customization of products, services, and
  promotional messages like never before
• Enhances relationships with customers more
  effectively and efficiently

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Changes in the Business Environment

• Access to customer patterns and preferences
• Evolution to other -Web connection
• PDAs
• HDTV
• Mobile phones

• Increased consumer power
• Access to information
• More products and services
• Interactive and instant exchanges

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Consumer Behavior

• 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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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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Business Leaders Who Understood Consumer Behavior

• Alfred Sloan, General Motors
• Colonel Sanders, KFC
• Ray Kroc, McDonalds

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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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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 Profitability-Focused Marketing
Tier 1 Platinum Tier 2 Gold Tier 3 Iron Tier
4 Lead
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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

• All companies prosper when society prospers.
• Companies, as well as individuals, would be
  better off if social responsibility was an
  integral component of every marketing decision.
• Requires all marketers adhere to
  principles of social responsibility.

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Firms Marketing Efforts 1. Product 2.
Promotion 3. Price 4. Channels of distribution
Sociocultural Environment 1. Family 2. Informal
sources 3. Other noncommercial sources 4. Social
class 5. Subculture and culture
Input
External Influence
Need Recognition Prepurchase Search Evaluation
of Alternatives
Psychological Field 1. Motivation 2.
Perception 3. Learning 4. Personality 5. Attitudes
Process
Consumer Decision Making
Experience
Figure 1-1 A Model of Consumer Decision Making
Purchase 1. Trial 2. Repeat purchase
Post-Decision Behavior
Output
Postpurchase Evaluation