BAC 324: Understanding Customer Behaviour

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Questions and Answers

What is the primary goal of studying customer behaviour?

To understand who is shopping in stores

To create more-enticing products and service offers (correct)

To understand how customers perceive marketing offers

To analyze sales and revenue

What is the most correct definition of customer behaviour?

Studying customer demographics

Describing who is shopping in stores

Analyzing how customers perceive marketing offers

How customers shop in stores, including their frequency and preferences (correct)

What are the five main factors that influence consumer behaviour?

Financial, Environmental, Social, Technological, and Political

Psychological, Social, Cultural, Personal, and Economic (correct)

Marketing, Sales, Service, Product, and Price

Demographic, Geographic, Psychographic, Behavioural, and Firmographic

What is Maslow's theory of hierarchy of needs?

A model that ranks customer needs from basic to self-actualization Signup and view all the answers

What is the role of motivation in consumer behaviour?

A key driver of consumer purchasing decisions Signup and view all the answers

What is the importance of understanding consumer perception?

It allows businesses to analyze customer needs and preferences Signup and view all the answers

What is the primary goal of understanding psychological factors in consumer behaviour?

To understand customer motivations and needs Signup and view all the answers

What is the significance of understanding consumer behaviour in business?

To communicate with customers in a productive and delightful way Signup and view all the answers

What is the primary purpose of Kotler's Five Product Level model?

To analyze product and customer profitability Signup and view all the answers

What is the initial stage of the new product development process?

Idea generation Signup and view all the answers

What is the primary goal of market research in the new product development process?

To determine the demand for a product Signup and view all the answers

What is the benefit of grouping products into product families that align with customer segments?

Better modeling of sales and production planning Signup and view all the answers

What is the primary focus of the production concept?

Production efficiency and cost reduction Signup and view all the answers

What is the primary goal of competitor analysis in the new product development process?

To identify areas for product differentiation Signup and view all the answers

What is the primary focus of the selling concept?

Sales and marketing strategies Signup and view all the answers

What is the benefit of having a robust understanding of the target market during the idea generation stage?

Understanding customer needs and pain points Signup and view all the answers

What is the primary goal of Single Segment Concentration?

To focus on a single market sector with minimal resources Signup and view all the answers

What is the basis of doing segmentation according to the VALS Framework?

Psychographic segmentation Signup and view all the answers

Which of the following companies is an example of Single Segment Concentration?

All of the above Signup and view all the answers

What is the primary advantage of Selective Specialization?

Reducing risks by targeting multiple segments Signup and view all the answers

What is the primary goal of Customer Driven Marketing Strategy?

To create a product that meets the needs of a specific customer segment Signup and view all the answers

What is the primary characteristic of a business that uses Single Segment Concentration?

Having a powerful market position Signup and view all the answers

What is the primary goal of Market Segmentation?

To divide a market into segments based on specific characteristics Signup and view all the answers

What is the primary advantage of understanding customer needs in the Consumer Decision Making Process?

It allows businesses to create a product that meets the needs of a specific customer segment Signup and view all the answers

Study Notes

Understanding Customer Behavior

Businesses study customer behavior to understand their target audience and create more enticing products and service offers.
Customer behavior involves understanding how customers shop, including factors like shopping frequency, product preferences, and how marketing, sales, and service offers are perceived.

Factors Influencing Consumer Behavior

There are five main factors that determine consumer behavior: Psychological, Social, Cultural, Personal, and Economic factors.

Psychological Factors

Motivation is a key factor influencing consumer behavior, with Maslow's theory of hierarchy of needs providing a framework for understanding different levels of human needs.
Perception is shaped by gathering information about a product and generating a relevant image.
Kotler's Five Product Level model provides a method for structuring product portfolios to target various customer segments.

Product Development Process

The new product development process begins with idea generation, where businesses brainstorm ideas to solve existing customer problems.
Research is conducted to flesh out ideas, including market research and competitor analysis.

Consumer Decision Making Process

Understanding consumer behavior helps businesses communicate with customers in a productive and delightful way.
Consumer decision making involves understanding the needs and pain points of the target market.

Market Segmentation

Single Segment Concentration involves focusing on a single market sector, such as Ginger Hotels catering to customers on a tight budget.
Selective specialization involves concentrating on several commercial sectors, reducing risk and allowing companies to shift focus to more lucrative areas.

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Description

Learn about customer behaviour, including shopping frequency, product preferences, and marketing perceptions, to create more appealing products and services.