Consumer Behavior

Def:
Understanding the behavior , consumer displays in
searching for, purchasing, using, evaluating and
disposing of products and services that they expect
will satisfy their needs
Personal Consumer
Organizational Consumers
Development of the Marketing Concept:
Production Concept : 1900s
1908 - $850
1916 - $ 360

Product Concept :
Marketing Myopia
Selling Concept :
Marketing Concept :
Alfred Sloan – Market Segmentation
KFC – 1930
Col Sanders
Implementing the Marketing Concept:
Segmentation
Targeting
Positioning
Marketing Mix:
Marico
Customer Value
Customer’s Value :
Perceived Benefits -
Economic
Functional
Psychological
&
Resources –
Monetary
Time
Effort
Psychological
Conventional Value Chain
Firm Centric
Porter’s Value Chain

Contemporary Model:
CK Prahlad & Venkat Ramaswamy –
Co-Creation
Value from Customer’s Perspective:
Personal – Demography
Esteem
Utility
Social
Price
Quality
Value Creation By the Firm:
Conformance Quality
Customer Satisfaction
Market-Perceived Quality
Value Relative to Competition
Customer Value Management
Customer Satisfaction :
Functions of Customer Expectations :
Completely Satisfied Customers – Loyalists
Apostles – Experience exceeds their expectations
Word of mouth
Defectors – Neutral
Terrorists – Negative Experiences
Hostages – Unhappy Customers
Mercenaries – Very satisfied but not loyal
Customer Retention :
Customer Profitability
Customer Pyramid :
Heavy users – Platinum
Price Sensitive – Gold
Iron
Lead
Strategies for Customer Loyalty
Jet Airways Case :
Mission – Alter Customers expectations of flying in
India
Not in the business of flying aircrafts
Business was to fly people
Started in 1993
Key Elements in the air-line business :
Network of destinations
Fleet of aircrafts
Continuous maintenance & housekeeping of aircrafts
Punctuality in flight timings
Low/minimum waiting on reservations
Tele-check-ins
Check-ins
Security &baggage retrievel
Continuous Communication with the customer
before, during & after a flight
In-flight & ground services
Exhaustive Research :
Dissatisfied Customers – Business Class
Business Travelers :
Values they looked for in an airline & what would
make their flying experience a memorable one
Customer information was transalated into the
product design :
Selection of aircraft
Its maintenance
Cleanliness
Ambience
Customer Training
In-flight service
Ground Service
Customized menu on board
Communicating by first name
One to one contact
1st to introduce – Frequent Flier
Strategy to compete in the International Market :
British Airways, Singapore Airlines
Influencing Buyer Behavior
Stages in Buying Process:

Customer Buying Process

Buyer’s
Recognition Search for mental Purchase Post
of problem or alternatives evaluation purchase
need and info. of behavior
alternatives

• Motives
Influencing Factors
• Culture/Social • Past experience • Speed of
• Friends • Store location
• Depleted • Brochures repairs
• Social class • Salesperson skill
inventory • Catalogs • Product
• Personality • Availability of durability
• Advertising • Memory, Risk credit
• Lifestyle • Extended
• Promotions, • Adoption process
store displays warranty

Time Line
Dalrymple & Parsons/Marketing 9
Management 7th edition: Chapter 3
Modeling Behavior:
Other influences

Personal Cultural
Motivation & involvement
influence influences

Problem recognition
Att Learning &
Information Search
itu memory
Purchasing Process
de Post-purchase behavior Sub-cultural
Family influences
Personality

Social group
Social class