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Questions and Answers
What is one benefit of retaining loyal customers?
What is one benefit of retaining loyal customers?
Mercenaries have strong loyalty and are unlikely to defect.
Mercenaries have strong loyalty and are unlikely to defect.
False
Name one strategy that can be used to develop customer retention.
Name one strategy that can be used to develop customer retention.
Erect switching barriers
Consumer behavior is an __________ area that includes the study of psychology and sociology.
Consumer behavior is an __________ area that includes the study of psychology and sociology.
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Match the following disciplines with their focus areas:
Match the following disciplines with their focus areas:
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What has technology created that significantly impacts the marketing mix?
What has technology created that significantly impacts the marketing mix?
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Customer satisfaction is defined as the individual's perception of product performance in relation to their expectations.
Customer satisfaction is defined as the individual's perception of product performance in relation to their expectations.
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Name one customer group based on satisfaction and loyalty.
Name one customer group based on satisfaction and loyalty.
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The ratio between the customer’s perceived benefits and the resources used to obtain those benefits is known as customer ________.
The ratio between the customer’s perceived benefits and the resources used to obtain those benefits is known as customer ________.
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Match the customer groups to their descriptions:
Match the customer groups to their descriptions:
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What does the customer retention strategy aim to enhance?
What does the customer retention strategy aim to enhance?
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Consumers provide limited information about themselves to marketers.
Consumers provide limited information about themselves to marketers.
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What do satisfied customers who do not have many other choices in the market refer to?
What do satisfied customers who do not have many other choices in the market refer to?
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Which of the following is NOT a base used to segment consumers?
Which of the following is NOT a base used to segment consumers?
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Behavioral targeting plays a minor role in today's marketing.
Behavioral targeting plays a minor role in today's marketing.
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What are the three key elements of the Consumer Decision Making Model?
What are the three key elements of the Consumer Decision Making Model?
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The study of signs and symbols, especially as elements of communication, is known as _____ .
The study of signs and symbols, especially as elements of communication, is known as _____ .
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Match each psychological field with its primary focus:
Match each psychological field with its primary focus:
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Which objective focuses on the relationship between segmentation, targeting, and positioning?
Which objective focuses on the relationship between segmentation, targeting, and positioning?
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Human Ecology is relevant in the study of consumer behavior.
Human Ecology is relevant in the study of consumer behavior.
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Name one of the factors used in behavioral targeting.
Name one of the factors used in behavioral targeting.
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Which of the following is not a characteristic of Geo-demographic segmentation?
Which of the following is not a characteristic of Geo-demographic segmentation?
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Psychographic segmentation includes consumers' activities, interests, and values.
Psychographic segmentation includes consumers' activities, interests, and values.
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What are the two motivations of VALS thinkers?
What are the two motivations of VALS thinkers?
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The VALS category known for being self-sufficient and not materialistic is called __________.
The VALS category known for being self-sufficient and not materialistic is called __________.
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Which segment in VALS is characterized by being young, enthusiastic, and social?
Which segment in VALS is characterized by being young, enthusiastic, and social?
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Match the following VALS segments to their primary characteristics:
Match the following VALS segments to their primary characteristics:
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Behavioral segmentation focuses on the benefits tourists seek in a national park.
Behavioral segmentation focuses on the benefits tourists seek in a national park.
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What are environmentalists seeking when visiting a national park?
What are environmentalists seeking when visiting a national park?
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What is the primary focus of the Marketing Concept?
What is the primary focus of the Marketing Concept?
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The Selling Concept prioritizes long-term customer relationships over transactions.
The Selling Concept prioritizes long-term customer relationships over transactions.
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What is market segmentation?
What is market segmentation?
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The focus of the Societal Marketing Concept is on sustainable practices for the __________ good of all stakeholders.
The focus of the Societal Marketing Concept is on sustainable practices for the __________ good of all stakeholders.
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Match the marketing concepts with their primary focus:
Match the marketing concepts with their primary focus:
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Which concept emphasizes the importance of knowing consumers' long-term interests?
Which concept emphasizes the importance of knowing consumers' long-term interests?
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Target marketing involves selecting a group of customers to focus resources on reaching.
Target marketing involves selecting a group of customers to focus resources on reaching.
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The Marketing Mix is a combination of tactical tools used by a marketer to execute __________.
The Marketing Mix is a combination of tactical tools used by a marketer to execute __________.
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Which type of tourist prefers a calm and unpolluted environment?
Which type of tourist prefers a calm and unpolluted environment?
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Want-it-all Tourists prioritize conservation over socializing.
Want-it-all Tourists prioritize conservation over socializing.
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What does real-time behavioral targeting allow advertisers to do?
What does real-time behavioral targeting allow advertisers to do?
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Usage rate classifies consumers into _____, medium, light, or non-users.
Usage rate classifies consumers into _____, medium, light, or non-users.
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Match the loyalty status with their descriptions:
Match the loyalty status with their descriptions:
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Which segmentation focuses on occasions like Valentine's Day?
Which segmentation focuses on occasions like Valentine's Day?
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Predictive analytics can help identify significant changes in consumer behavior.
Predictive analytics can help identify significant changes in consumer behavior.
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What is the role of data brokers in real-time behavioral targeting?
What is the role of data brokers in real-time behavioral targeting?
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Study Notes
Consumer Behaviour - Unit 1
- This unit introduces consumer behaviour, markets, and technology.
- Key learning objectives involve understanding the evolution of the marketing concept, marketing tools, the relationship between value and customer retention, and socially responsible marketing.
- Students need to understand how the internet and related technologies improve marketing transactions by adding value for both marketers and customers.
- The interrelationships among customer value, satisfaction, and retention in today's marketing are crucial. Understanding effective customer retention is also important.
- Consumer behavior should be viewed as an interdisciplinary area, including consumer decision-making.
What is Consumer Behaviour?
- Consumer behavior is the study of all consumer decisions (relating to acquisition, use, and disposal of marketing offers, goods, and services) at different times (hours, days, weeks, months, and years).
- This includes searching for, purchasing, using, evaluating, and disposing of products or services to meet needs.
Market Offering
- A market offering is anything that promises to fulfill customer needs and wants.
- Market offerings include goods, services, events, experiences, places, organizations, information, and ideas.
Learning Objective 1.1
- Understand the evolution of the marketing concept, tools used in marketing strategies, the connection between values and customer retention, and socially responsible marketing.
Marketing Orientations/Philosophies
- These philosophies guide marketing strategies.
- Specific concepts include:
- Production concept
- Product concept
- Selling concept
- Marketing concept
- Societal marketing concept
Production Concept
- Consumers favor widely available, affordable products.
- Focus: Production and distribution efficiency.
Product Concept
- Consumers favor high-quality, superior performance, and innovative products.
- Focus: Continuous product improvement
Selling Concept
- Consumers will not buy enough of a company’s products unless it undertakes large-scale selling and promotion efforts.
Marketing Concept
- Knowing the needs and wants of target markets and providing desired satisfaction better than competitors is key to achieving organizational goals.
- Focus: Customer needs and suitable offerings.
Societal Marketing Concept
- Marketing decisions should consider consumers’ wants, company requirements, consumers' long-term interests, and society's long-run interests.
- Focus: Sustainable practices for the collective good of all stakeholders.
Selecting Customers to Serve
- Consider the entire collection of actual and potential buyers.
Market Segmentation
- Divide the market into groups of customers with similar needs and wants (homogeneous).
Target Marketing
- Focus resources on reaching a specific customer group(s).
Marketing Mix
- Using a combination of tactical tools.
- Tools used by marketers to execute strategy include product, price, place, and promotion. For services, also consider people, process, and physical evidence.
Learning Objective 1.3
- Understand how the internet and related technologies improve marketing transactions by adding value to both marketers and consumers.
Marketing & Technology
- Technology has significantly revolutionized the marketing mix.
- Technology creates value exchanges, allowing for lower prices and customized products.
- Consumers provide data, allowing for better, precise targeting of customers.
- Consumers have greater access to information and products.
Learning Objective 1.4
- Understanding the interrelationships among customer value, satisfaction, and retention and technology's revolutionary role in creating effective retention measures and strategies is critical.
Successful Relationships: Value, Satisfaction, Retention
- Successful relationships require high customer value, satisfaction, and retention.
Customer Value
- The ratio between a customer's perceived benefits and the resources used to obtain them.
Customer Satisfaction
- Perception of how well a product or service meets expectations.
Customer Groups
- Loyalists, Apostles, Defectors, Terrorists, Hostages, Mercenaries
Customer Retention
- Objective in providing value is to keep satisfied customers, who buy more products, care less about price, and spread positive word-of-mouth.
Measures to Assess Customer Retention
- Customer Valuation, Retention Rates, and Analyzing Defections
Learning Objective 1.5
- Understand consumer behavior as an interdisciplinary area, encompassing consumer decision making.
Interdisciplinary Nature of Consumer Behaviour
- The influence of psychology, sociology, social psychology, anthropology, and communication studies.
Interdisciplinary Influences
- Various factors, including neuro-science/neuro-marketing, experimental psychology, developmental psychology, human ecology, microeconomics, social psychology, macroeconomics, semiotics/literary criticism, demography, history, cultural anthropology, affect and influence consumer behaviour
Consumer Decision Making Model
- Stages in the consumer decision-making process (input, process, and output).
Tutorial Session
- Tutors cover segmentation, targeting, and positioning.
Chapter 2 Learning Objectives
- Understand the interrelationships among market segmentation, targeting, and positioning.
- Understand segmentation bases (demographics, psychographics, product benefits sought, and usage-related factors).
Learning Objective 2.1
- Understand the interrelationships among market segmentation, targeting, and positioning. This includes selecting the best target markets.
Market/Segmentation/Targeting
Why is Segmentation Necessary
- Consumer differences necessitate different strategies.
- Segmentation helps tailor products and messaging.
Selecting Target Markets
- Target segments should be identifiable, profitable, stable, and reachable, congruently aligning with objectives and resources.
Criteria for Effective Targeting
- Identifiable segments, sizeable segments, stable segments, accessible segments, segments congruent with the company's objectives & resources
Learning Objective 2.2
- Understand segmentation bases: Demographics, Psychographics, Product Benefits Sought, and Usage-Related Factors.
Market Segmentation
- Demographic (age, gender, FLC, social class, etc.)
- Geographical (Geo-demographic)
- Psychographic (lifestyle, activities, interests, opinions, values)
- Behavioral (benefit, usage rate, awareness, occasion)
Quantitative Factors
- Factors measurable in numerical terms (demographics, geographics, usage rate, purchase frequency).
Cognitive Factors
- Factors residing in consumers’ minds (personality traits, cultural values, attitudes, preferences).
Psychographic Segmentation
- Consumers' lifestyles; activities, interests, and opinions. These factors explain purchase decisions.
Personality Traits
- Consumer innovators, Open-mindedness
VALS
- Values and lifestyles segmentation system categorizing consumers by primary motivation and resources (Innovators, Thinkers, Believers, Achievers, Experiencers, Strivers, Makers, Survivors).
Brand Loyalty
Usage Rate, Usage Occasion Segmentation
RTB (Real-Time Bidding)
- A technique that enables advertisers to precisely target users by determining bids on a per-impression basis.
- Involves tracking user interests by observing their behaviour/actions including website visits, and purchase history
Profiling Impressions
- Profiling includes using (invisible) cookies on Web pages to track users behaviours (website visits, usage, engagement),
Predictive Analytics
- Measures designed to predict consumers' future purchases using information obtained from their prior data and personalized promotions
Tracking Online Navigation
- Websites visited, engagement on sites, lifestyles/personalities, purchase, returns, and exchanges
Instagram Advertisements
Learning Objective 2.3
- Understand behavioral targeting, including real-time bidding, and its role in modern marketing.
Learning Objective 2.4
- Understanding how to position, differentiate, and reposition products
Positioning
- Process of creating a distinct image and identity for products, services, or brands in consumers' minds.
Umbrella Positioning
- Statement or slogan describing the universal benefit of a company's offering
Other Types of Positioning
- Premier positioning, positioning against competition, key attribute positioning, unowned positioning
Perceptual Map
- Diagram illustrating consumers' perceptions of competing brands along relevant product attributes.
Positioning Statement Example
Repositioning
- Strategically changing a product's image/identity in consumers' minds.
Recap – Implementing STP
- Stages in implementing STP (Segmentation, Targeting, Positioning)
Next Steps – Consumer Research
- The next step in marketing strategy is consumer research.
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Description
Explore key concepts in consumer behavior and strategies for enhancing customer retention. This quiz covers definitions, matching disciplines with their focus areas, and the importance of loyal customers. Test your knowledge on customer satisfaction and the marketing mix.
