Basics of consumer behaviour
- 1. Girish Jadhwani MBA II Basics of consumer behaviour
- 2. Index Sr.No Topic Slide no 1 2 3 4 5 6 7
- 3. Why to Study Consumer Behavior..? – To stay in business by attracting and retaining customers – To benefit from understanding consumer problems – To establish competitive advantage – Because it is interesting!
- 4. Failure rates of new products introduced – Out of 11000 new products introduced by 77 companies, only 56% are present 5 years later. – Only 8% of new product concepts offered by 112 leading companies reached the market. Out of that 83% failed to meet marketing objectives.
- 5. CONSUMER BEHAVIOUR – THE BEHAVIOUR THAT CONSUMERS DISPLAY IN SEARCHING FOR, PURCHASING, USING, EVALUATING, AND DISPOSING OF PRODUCTS AND SERVICES THAT THEY EXPECT WILL SATISFY THEIR NEEDS. – STUDY OF HOW INDIVIDUALS MAKE DECISIONS TO SPEND THEIR AVAILABLE RESOURCES <TIME… MONEY…EFFORT> ON CONSUMPTION RELATED ITEMS.
- 6. CONSUMER BEHAVIOUR – STUDY OF : * WHAT THEY BUY * WHY THEY BUY IT * WHEN THEY BUY IT * WHERE THEY BUY IT * HOW OFTEN THEY BUY IT, AND, * HOW OFTEN THEY USE IT – STUDY OF THE PROCESSES BY WHICH CONSUMERS MAKE DECISIONS. MORE SPECIFICALLY, IT IS CONCERNED WITH HOW CONSUMERS ACQUIRE ORGANIZE AND USE INFORMATION TO MAKE CONSUMPTION CHOICE. INTRODUCTION
- 7. Definition of Consumer Behavior – Individuals or groups acquiring, using and disposing of products, services, ideas, or experiences – Includes search for information and actual purchase – Includes an understanding of consumer thoughts, feelings, and actions
- 8. Acquisition, Consumption and Disposal – Acquisition – Receiving – Finding – Inheriting – Producing – purchasing – Consumption – Collecting – Nurturing – Cleaning – Preparing – Displaying – Storing – Wearing – Sharing
- 9. Acquisition, Consumption, Disposal – Disposal – Giving – Throwing away – Recycling – depleting
- 10. Basis for Comparison Customer Consumer Meaning The purchaser of goods or services is known as the Customer. The end user of goods or services is known as a Consumer. Resell A customer can be a business entity, who can purchase it for the purpose of resale. No Purchase of goods Yes Not necessary Purpose Resale or Consumption Consumption Price of product or service Paid by the customer May not be paid by the consumer Person Individual or Organization Individual, Family or Group of people Difference between customer and consumer
- 11. Consumer Roles – Initiator – Influencer – Decider – Gatekeeper – Buyer – User – Disposers
- 12. Consumer behavior and Demarketing – Demarketing may be considered “unselling” or “marketing in reverse”, which includes general and selective demarketing. – Although the concept of demarketing lacks a precise theoretical definition, it refers to an attempt by the firm to discourage all or some of its customers from making purchases either temporarily or permanently. Since the initial interests in the subject area of how to market strategically in times of shortages began, different viewpoints have been offered as to how the firm should pursue demarketing
- 13. Definition and Types of demarketing – In 1971 Kotler and Levy published a paper in the Harvard Business Review that introduced the then novel concept of “Demarketing,“that aspect of marketing that deals with discouraging customers in general or a certain class of customers in particular on either a temporary or permanent basis” Types of demarketing • General Demarketing • Selective Demarketing • Ostensible Demarketing • Unintentional Demarketing
- 14. Consumerism- Definition – Consumerism, the "social movement seeking to augment the rights and power of buyers in relation to sellers," (Kotler, 1972) – It is manifest in new laws, regulations, and marketing practices, as well as in new public attitudes toward government and business.
- 15. Consumerism- Definition – Marketing concept – Consumerism is a social and economic order that is based on the systematic creation and fostering of a desire to purchase goods or services in ever greater amounts. – In economics, consumerism refers to economic policies placing emphasis on consumption. – In an abstract sense, it is the belief that the free choice of consumers should dictate the economic structure of a society
- 16. Consumerism – The movement seeking to protect and inform consumers by requiring such practices as honest packaging and advertising, product guarantees, and improved safety standards" – or alternatively: "The theory that a progressively greater consumption of goods is economically beneficial".