Marketing 5

Five stages of the purchase decision processes
Problem recognition- desired state diff. From actual condition
Information search- buyer seeks to identify most appropriate suppliers once need been recognized
Alternative evaluation- consumers evaluate the feature of products and brands
Purchase decision- making decision move forward with a purchase
Post purchase behavior buyer may regrets his or her purchase
Three variations of the consumer purchase decision process
Routine-with little or no conscious effort
Limited- initiated motive that is fairly central to self-concept and is perceive
Extended- problem solving process employed
Psychographic
Lifestyle = Pshchographics…analysis
Reciprocity refers to
An industrial buying practice in which two organizations, manufacturer and a supplier agree to purchase each other’s products and services
Derived demand
The demand for industrial products and services that is driven by demand for other products and services
Situational influences
Physical-encompassing a consumer activity
Social-individual consumer’s behavior; activity…life style (psychographics)
Purchase task-reflects reason for engaging in the buying
Antecedent states- lasting effect beyond that decision
Temporal Perspective= time of day, season
North American Industry Classification System (NACIS)
Common industry definitions for Canada, Mexico, and the United States, which makes it easier to measure economic activity
Stages in the organizational buying process
Problem recognition,Information search,Alternative evaluation ,Purchase decision, Post-purchase behavior
are all influences by Situational, Physiological, Marketing Mix and Sociocultural
Organizational buying roles
Gatekeeper-control access to personnel in a company. The receptionist, the secretaries etc.
Influencer-have the power to persuade deciders and buyers during the decision making process…offer opinion…prior experience
Decider-approve the purchase
User-work directly with the purchased products or services
Buy classes
New buy-(research)
Straight rebuy-(routine)
Modified rebuy-(some research
Primary vs secondary data
Primary original
Secondary existing
Perceived risk and temporal states
represents the anxiety felt because the consumer can’t anticipate the outcomes of a purchase
Types/sources of personal observational data:
mechanical electronic (Niseln Media Research) personal(Mystery shoppers) neuromarketing (focus groups, ethnicgraphic)
Sociological influences
Family
Social Class
Culture
Demographics
Reference Group
Market segmentation
Aggregating prospective buyers into groups that have common needs and will respond similarly to a marketing action
Data mining refers to
Extraction of hidden predictive information from large data bases
use for predictive behavior
psychological influence
perception
motivation
personality
lifestyle
differentiated marketing strategy
appealing to the total market without regard to specific segments “Mass marketing”
Commodities, often non-profit/ “social” marketing causes, small marketing budget, little research
Undifferentiated marketing strategy
developing one or more products for each of several customer groups
developing different advertising strategies( message/media) for different customer groups(but offering the same product)
five step marketing research process
Define the problem: Specifying research objectives, Identifying consumer population of interest,Placing the problem in an environmental context
Develop a research plan: how collect data, identify data for marketing actions,specify constraints
Collect the relevant information: obtain primary and secondary data, information technology and data mining
Develop findings: analyze data, present findings
take action: Recommend, Implement,Evaluate
physiological influences
motivation
personality
perception
perceived risk
Values and Attitudes
Life Style (Psychological)
Industrial market
process, before selling
Wholesalers and re sellers markets
purchase and sell without reprocessing
Government markets
federal, state, and local… purchase goods and services for their constituents
three types of research methods
exploratory: provides ideas
causal: change in one factor changes another
descriptive: involves trying to determine frequency and relationship
three types of research questions/questionaires
Open-ended
Closed-ended/fixed Alternative
Dichotomous…type of fixed alternative
Semantic differential
Likert Scale
Advantage& Disadvantage of Primary and Secondary data
Secondary…low cost..time saving…can be out of date
Primary..more costly…time consuming
Types of auctions
Traditional:buyers compete to obtain a good or service by offering increasingly higher prices
Reverse:is a type of auction which the roles of buyer and seller are reversed
Market Product Grid
to identify a target market and recommend resulting actions
detecting new growth opportunities
Penetration strategy
When the product is in the current market, it can still grow.
There are three major approaches to increasing current product’s market share: 1. Encourage current customers to buy more. 2. Attract competitor’s customers. 3. Convince non-users to use the product.
Product development
When a new product is launched in the current market, the intensive growth strategies could be to: 1. Develop new features. 2. Develop different quality levels. 3. Improve the technology.
Market development
When the current product is launched in a new market, there are three approaches to develop the market: 1. Expand distribution channels. 2. Sell in new locations. 3. Identify the potential users
Diversification
When a new product is launched in a new market, diversification makes good sense as better opportunities are found outside the present business.
Geographic Segmentation
target markets for Region, City size, Stats area, Media-television, and density
Ethics
Personal, moral, principles and values
Laws
Society’s values and standards and are enforceable in the courts
Consumer bill of rights (1962)
Is a law that codified the ethics of exchange between buyers and sellers, including the rights to safety, to be informed, to choose, and to be heard
Moral idealism
Rights or duties as universal, regardless of the outcome
Example peace corps
Utilitarianism
Greatest Good for the greatest number
Example great marketing
Social audit
Consists of a systematic assessment of a firms objectives, strategies, and performance in terms of social responsibility
Triple bottom line
Accounting framework that incorporates three dimensions of performance: social, environmental , and financial Dimensions are commonly called people, planet, and profits
Supply chain management
Consist of all parties involved, directly or indirectly, in fulfilling a customer request. Included manufacturer and suppliers, transporters, warehouses, retailers, and customers themselves
Includes all functions involved in receiving and filling a customer request
Market segments
homogeneous groups of prospective buyers that result from the market segmentation process.
market-product grid
framework to relate the market segments of potential buyers to products offered or potential marketing actions by an organization.
Usage rate or frequency marketing
quantity consumed or patronage (store visits) during a specific period
Product positioning
place an offering occupies in a consumer’s mind on important attributes relative to competitive products
Product repositioning
changing the place an offering occupies in a consumer’s mind relative to competitive products
Actionable/Practical
The firm has the capability(s) to market to each segment, if required
Substantial
Given the segments are relatively broad, they should be individually substantial
Accessible
Various merchandising techniques can be used to promote and reach each of these segments
Responsive
Each market segment should respond better to a distinct marketing mix
A target market is
homogenous group of prospective buyers that results from the market segmentation process
Behavior-based variables
usage rate, usage occasion, product benefits
A market segmentation practice that divides the population of prospective customers based on the frequency with which they are likely to use a given product or service:
Heavy users
Light users
Non-users
The Target Marketing Process
Segmentation
Target Market
Positioning –
Secondary research
internal sources- feed backs, reports
external sources-published research government sources, syndicated research
primary research
exploratory-vague problem, involve in-depth consumer probing
causal- change in factor,Cause-and-effect relationships
descriptive-frequency and relationship terms of sales,Observational methods
Mass marketing focuses on
high sales and low prices.
Mass marketing philosophy…the total market is viewed as one big market with
NO segmentation.
Questionnaire data
facts and figures obtained by asking people about their attitudes, awareness, intentions, and behaviors.
Observational data
facts and figures obtained by watching, either mechanically or in person, how people actually behave
Marketing research
process of defining a marketing problem and opportunity, systematically collecting and analyzing information, and recommending actions
semantic differential scale questionnaire
used for measuring the meaning of things and concepts.
Likert scaling
measures the extent of agreement, bipolar scaling method
Dichotomous/Close-ended /Fixed Alternative
Yes/No; True/False; Agree/Disagree response. (‘Di = 2’)
Semantic Differential
measure people’s attitude toward stimulus words, objects, and concept
Open ended
more than one word answers
4 Types of Data
Internal Company Data-Customer Data – Knowing who your customer is,Customer Demographics,Spending Habits,Sales Data, Inventory Tracking
Marketing Intelligence-Competitive intelligence, Information about trends in external environment
Acquired Databases-Government databases, Purchase other companies’ data
Exploratory-(Qualitative and Quantitative) Research
Examples of Wholesale Merchants
Merchant: Own (take title to) the products they sell.
General merchandise: Carry a wide variety of nonperishable items.
Examples of Wholesale Merchants(2)
Single-line: Carry a narrow line of merchandise.
Cash-and-carry wholesalers…just what the name implies
North American Industry Classification System
environmental, competitor, buyers, suppliers, industry, and customers
North American
Free Trade
Agreement (NAFTA)
Began with President Ronald Reagan for the 1994 agreement reached by the United States, Canada, and Mexico that instituted a schedule for the phasing out of tariffs and eliminated a variety of fees other hindrances to encourage free between the three North American countries
Strategic Outsourcing
Process of engaging the services of a provider to manage essential tasks that would otherwise be managed by in-house personnel…insurance third-party providers.
Electronic commerce (Ecommerce
Allows consumers to electronically exchange goods and services with no barriers to time and distance.
Buyer-Seller Relationships and Supply Partnerships
Supply Partnership, Just-in-Time (JIT), Reciprocity
Business-to-business (B2B)
buying behavior refers to decision making and other activities of organizations as buyers
The important values of fairness, honesty, and trust should
influence all negotiations between business purchasers and their suppliers
For firms pursuing global markets, the possibility of
encountering ethical dilemmas is multiplied many times
Buy’ Classes
New Buy (research)
Straight Re-buy – buy same product from same vendor (routine)
Modified Re-buy- change the product(some research
Types of Auctions
Ascending,Descending,First Price Sealed Bid and Second-Price Sealed Bid