CHAPTER ONE

Consumer Behavior and Marketing Strategy

McGraw-Hill/Irwin
Copyright 2004 by The McGraw-Hill Companies, Inc. All rights reserved.

What is Consumer Behavior?

The study of individuals, groups, or organizations and the processes they use to select, secure, use, and dispose of products, services, experiences, or ideas to satisfy needs and the impacts that these processes have on the consumer and society.

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Why study consumer behavior?

Consumer behavior theory provides the
manager with the proper questions to ask Marketing practice designed to influence consumer behavior influences the firm, the individual, and society All marketing decisions and regulations are based on assumptions about consumer behavior
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Applications of Consumer Behavior

Marketing Strategy Regulatory Policy Social Marketing Informed Individuals

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Marketing Strategy & Consumer Behavior

Creating Customer Value:
The difference between all the benefits derived from a total product and all the costs of acquiring those benefits.

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Marketing Strategy & Consumer Behavior

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Consumer Insight 1-1

What services could become experienceprovoking events? How would they do this? How can retailers, including Internet outlets, provide their customers experiences? What would a store like Niketown (or a local shopping mall in your area) have to do to charge admission for customers to enter?

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Market Analysis Components

The Consumers The Company The Competitors The Conditions

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Market Segmentation
Market Segment: a portion of a larger
market whose needs differ somewhat from the larger market. Four steps to segmentation: Identify product-related need sets Group customers with similar need sets Describe each group Select an attractive segment(s) to serve

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Market Segment Attractiveness

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Marketing Strategy
How will we provide superior customer
value to our target market? Marketing Mix The Product Communications Price Distribution Service

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Outcomes
Firm:
Product positioning Sales Customer Satisfaction Individual: Need Satisfaction Injurious Consumption Society: Economic Physical Environment Social Welfare

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Creating Satisfied Customers

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Overall Model Of Consumer Behavior

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Consumer Insight 1-2

What does the consumption of a product
like Nikes mean to Andre? What does this story say about our society and the impact and role of marketing?

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