Food Marketing and Consumer Behaviour - Chapter 1 - 2023-2024 PDF

Food marketing and consumer behaviour Academic year 2023-2024 Prof. dr. ir. Wim Verbeke Prof. dr. Christine Yung Hung ir. Fien Minnens Department of Agricultural Economics [email protected]; [email protected]; [email protected] Food marketing and consumer behaviour - Chapter 1 1 Chapter...

Food marketing and consumer behaviour Academic year 2023-2024 Prof. dr. ir. Wim Verbeke Prof. dr. Christine Yung Hung ir. Fien Minnens Department of Agricultural Economics [email protected]; [email protected]; [email protected] Food marketing and consumer behaviour - Chapter 1 1 Chapter 1: Introduction What is marketing? • Course objectives – – – – Principles of marketing for food Marketing management Communicate in marketing terms Think and Act Market oriented Food marketing and consumer behaviour - Chapter 1 3 What is marketing? Share the three words that come spontaneously to your mind when thinking about “marketing” Food marketing and consumer behaviour - Chapter 1 4 Course objective • Think and act market and consumer oriented • Look at the following situation – “Our customer wants a NEW THING installed in garden” – “Let’s put our best people on this project!” – “Let’s involve all departments to tackle this challenge!” Food marketing and consumer behaviour - Chapter 1 5 Stage 1: • Our commissionary (prospector) visits a prospective customer and discusses his/her needs. • The situation appears to be clear. The commissioner returns to the company and feels all right about the new project and having a potential new client. Food marketing and consumer behaviour - Chapter 1 6 Stage 1: As our commissionary understood the need Food marketing and consumer behaviour - Chapter 1 7 Stage 2: • The commissionary explains the customers’ need to the sales people, who in turn will report this demand to the company. • They write and draw their sales report as follows: Food marketing and consumer behaviour - Chapter 1 8 Stage 2: As sales reported Food marketing and consumer behaviour - Chapter 1 9 Stage 3: • “Sales” has asked for a new product. Apparently there are people out there who are interested in this kind of product. • Now it is up to us, the Research and Development (R&D) department, to design this thing: Food marketing and consumer behaviour - Chapter 1 10 Stage 3: As R&D designed and developed Food marketing and consumer behaviour - Chapter 1 11 Stage 4: Here comes a new design from R&D. How to manufacture this thing? OK, it’s clear, let’s do it this way: Food marketing and consumer behaviour - Chapter 1 12 Stage 4: As manufacturing produced Food marketing and consumer behaviour - Chapter 1 13 Stage 5: • This morning, we received a strange thing, to be installed in a customers’ garden. • It will not be easy, but we certainly will manage to assemble the thing. Food marketing and consumer behaviour - Chapter 1 14 Stage 5: As assembly installed Food marketing and consumer behaviour - Chapter 1 15 Stage 6: Oh no! Our customer is not satisfied !? How could this happen? What was the problem after all? Food marketing and consumer behaviour - Chapter 1 16 Stage 6: As the customer wanted it! Food marketing and consumer behaviour - Chapter 1 17 Food marketing and consumer behaviour - Chapter 1 18 Course objective • Think and act market and consumer oriented • Look at the following situation – “Our customer wants a NEW THING installed in garden” – “Let’s put our best people on this project!” – “Let’s involve all departments to tackle this challenge!” • Illustration: One way of handling a “customer need”… – – – – clearly the wrong way … a problem of not understanding the customer a problem of not understanding each other within a company lack of ability to think and act market and customer oriented Food marketing and consumer behaviour - Chapter 1 19 Course contents: Part One Marketing & Marketing Management • General introduction • CH. 1. Marketing and marketing management Food marketing and consumer behaviour - Chapter 1 20 Part Two: Analysing market opportunities • • • • • CH. 2. The marketing environment CH. 3. Consumer behaviour CH. 4. Consumer safety and quality perception CH. 5. Market research CH. 6. Developing a marketing strategy Food marketing and consumer behaviour - Chapter 1 21 Part Three: The Marketing Mix Each one of the 4 P’s • • • • CH. 7. Product management CH. 8. Pricing tactics CH. 9. Communication management (Promotion) CH. 10. Distribution management (Place) Food marketing and consumer behaviour - Chapter 1 22 What is marketing according to you? • Spontaneous associations ? • Marketing may have many different meanings to different people Food marketing and consumer behaviour - Chapter 1 23 Food marketing and consumer behaviour - Chapter 1 24 What is marketing? • • • • Activities to satisfy consumer needs Right product at the right price, place and time Right = what is right for the consumer / customer Marketing management = Managerial process: – – – – – Analysis Planning Strategy Implementation Control Food marketing and consumer behaviour - Chapter 1 25 What is marketing? • Western Europe, 1950s: – shortage of products / foods – no need for stimulating demand – focus on efficiency of marketing functions • storage • transportation • processing • distribution – 1970s: increasing importance of the role of institutions • Role of government • Role of marketing institutions: auctions, cooperatives Food marketing and consumer behaviour - Chapter 1 26 What is marketing? • Today’s “affluent society”: – Need for quality instead of quantity – Need for variation – New products, differentiation, innovation • Marketing Management approach • Customer orientation – customer / consumer is key and center – fulfillment of consumer needs Food marketing and consumer behaviour - Chapter 1 27 The core concepts of marketing • • • • • • Needs, wants and demand Products Value, cost and satisfaction Exchange, transactions and relationships Markets Marketing and marketeers Food marketing and consumer behaviour - Chapter 1 28 The core concepts of marketing • Need: state of feeling of deprivation • Want: desire for specific satisfier • Demand: want backed up by spending power and willingness to pay • Product: – Offers satisfaction to a need or a want – Physical product or service • Value: estimate of the capacity to satisfy a need Food marketing and consumer behaviour - Chapter 1 29 The core concepts of marketing • Exchange: one way to obtain a product – – – – – Two parties Things of value for both parties Communication and delivery Freedom to accept or reject Belief in appropriateness to deal • Market: – Group of people sharing same need/want – Willing and able to engage in exchange – Aim: satisfy the need or want Food marketing and consumer behaviour - Chapter 1 30 The core concepts of marketing • Marketeer: – Party seeking exchange more actively – Counterpart = prospect Food marketing and consumer behaviour - Chapter 1 31 Marketing Concept (b) versus Selling Concept (a) Starting point Focus Means Ends Company Products Selling and promoting efforts Profit through sales volume (a) The selling concept Market Customer Coordinated needs efforts Profit through customer satisfaction (b) The marketing concept Food marketing and consumer behaviour - Chapter 1 32 Possible company orientations towards markets • Production orientation: – Product availability is the major attention point – Low cost (mass) production – High production efficiency / productivity • Product orientation: – Product quality – Good products, improve products, better products – “good / the best products sell automatically” ? • Selling orientation: – Selling and promotion efforts – “additional efforts are needed to sell” Food marketing and consumer behaviour - Chapter 1 33 Company orientations • Marketing orientation: – Core = needs and want of target markets – Aim = to deliver satisfaction – Through 4 pillars: • Market focus • Customer orientation • Coordinated effort • Profitability Food marketing and consumer behaviour - Chapter 1 34 The marketing concept 1. Market oriented / customer focused 2. Coordinated effort 3. Profit oriented Marketing orientation • Consumers’ needs • Food companies Production orientation • Produce more • Farming businesses 4 elements /components of the marketing mix Food marketing and consumer behaviour - Chapter 1 35 4 pillars of the marketing concept 1. Market as starting point, but focus needed – Nobody can satisfy every need – Choose your target market (see later: STP) 2. Customer orientation – – – – Define need from customer viewpoint Realise customer retention Through providing customer satisfaction Maximise the opportunity to complain Food marketing and consumer behaviour - Chapter 1 36 4 pillars of the marketing concept 3. Coordinated effort – Involving all marketing functions – Together with other company departments 4. Profitability – Make profit to stay in business – By satisfying needs/wants/customers better than competitors do Food marketing and consumer behaviour - Chapter 1 37 The marketing concept 1. Market oriented 2. Customer focused 3. Coordinated effort 4. Profit through providing satisfaction Combine 4 P’s towards optimal results: PRODUCT PRICE PROMOTION / Communication PLACE OF DISTRIBUTION Food marketing and consumer behaviour - Chapter 1 38 Driving forces to adopt the marketing concept • • • • Sales decline: stabilisation of population (EU); worldwide growth Slow market growth: e.g. European Union food market 2-3 %/yr Changing buying patterns : e.g. quality, convenience, variety Increasing competition : – – – – Food versus non-food expenditures; food price inflation At home versus out-of-home consumption Global food suppliers, manufacturers, markets Sustainability issues: eating less and wasting less Food marketing and consumer behaviour - Chapter 1 39 Complete marketing model Company Analysis Objective Planning Application Control Information system Data: -Intern -Secondary -Primary Market Needs Wants Consumer Segments Marketing mix Price Product Promotion Distribution Food marketing and consumer behaviour - Chapter 1 40 Complete course model Ch.2 Marketing environment How companies learn from their environment Company Analysis Objective Planning Application Control Ch.6 Marketing strategy How companies plan based on their analysis of markets and the environment Ch.3 Market research How companies learn from their market Ch.4 and Ch.5 Consumer behaviour Information system How consumers make Data: food purchasing decisions -Intern -Secondary -Primary Market Needs Wants Consumer Segments Marketing mix Ch. 7 Product Ch. 9 Price Ch. 10 Ch. 8 Promotion Distribution Food marketing and consumer behaviour - Chapter 1 Ch. 7, 8, 9, 10 Each of the marketing mix elements 41