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CB BB BBBBBB
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Organizational/business buying
• Any good or service purchased for a reason other than personal or
household consumption is part of the business market.
• The activity of marketing goods and services to business users, rather than
to ultimate users, is business marketing.
• Product Specification
– Development of the items technical specification product value
analysis (PVA) is done.
– PVA is an approach to cost reduction in which components are
carefully studied to determine if they can be redesigned or
standardized or made by cheaper methods of production
• Supplier Search
– Identification of the most appropriate supplier
• Proposal Solicitation
– Buyer invited qualified suppliers to submit proposals
• Supplier Selection
– Buying center will specify desired supplier attributes and indicate
their relative importance
– It rates each supplier on the identified attributes
• Price
• Supplier reputation
• Product reliability
• Service reliability
• Supplier flexibility
• Performance Review
– Supplier evaluation can be done by
• Contacting the end user and asking for feedback
• Buyer may rate the supplier on various criteria using weighted score
method
Growth of consumer research
• Consumer research is an extension of
marketing research.
• Emphasis on consumer behavioral aspects.
• Earlier objectives of consumer research were:
• To determine why consumers made
purchasing decision.
• To understand how consumers would react to
promotional messages
Research techniques
• 1. Qualitative research technique: its findings
give insights on psychological aspects of
consumer behavior which help in generation
of new product ideas.
• 2. Quantitative research technique: It helps in
analyzing the likely behavior to be adopted by
the consumer based on various promotional
inputs.
Consumer Research:
Methods of Studying Consumer Behavior
1. Observation
• In-home observation: examining how and when
consumers use and consume products in their households
• Shadowing: following and observing consumers in the
shopping and consumption processes. Researchers may
ask questions about reasons for behaviors
• Physiological methods: Techniques borrowed from
medicine, psychology and other sciences including
cameras to measure eye movement, galvanic skin
response, and MRI
2. Interviews and Surveys
• Surveys: efficient method for gathering information
from a large sample of consumers by asking questions
and recording responses (telephone and Internet
surveys, mall intercepts, and mail questionnaires)
• Focus Groups: a group discussion led by a
moderator skilled in persuading consumers to thoroughly
discuss a topic of interest
• Longitudinal Studies: repeated measures of
activities over time to determine changes in opinions,
buying, and consumption behaviors
3. Experimentation
• Attempts to understand cause-and-effect relationships
by carefully manipulating independent variables to
determine how these changes affect dependent
variables
• - Laboratory experiment
• - Field experiment
• Independent variables might include number of
advertisements and package design
• Dependent variables might include purchase intent or
behavior
4. Consumption Research
• Builds on the three primary research
methods to examine how people use
products and services rather than how they
buy them
• May use ethnographic tools to under-stand
how values and culture influence usage of
products and other behaviors
• May identify new uses for existing products
or new product to satisfy unmet or changing
consumer needs
Class test
• Differentiate between consumer and
customer with suitable examples.
• How present marketing concept evolved from
the production concept?
• What is the process of STP? Why it is so
important to understand the consumer
behavior ?Give examples.
Segmentation: Learning Objectives
1. To Understand Why Market Segmentation Is
Essential.
• Differentiation helps
products compete
• Segmentation helps
identify media
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Positioning
The value
proposition,
expressed through
promotion, stating
the product’s or
service’s capacity
to deliver specific
benefits.
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Criteria for Effective Targeting
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Bases for Segmentation
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Discussion Questions
• Considering the largest bank in your college’s city or
town:
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Consumer-Rooted Segmentation Bases
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Demographic Segmentation
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Demographic Profile of India
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Demographic Profile of India
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Demographic Profile of India
2010 (Estimate)
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Income
Category Yearly Income Nature Remarks
The very rich INR> 200,000 Benefit maximizers Own cars, PCs
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Personality Traits
• People often do not identify these traits because
they are guarded or not consciously recognized
• Consumer innovators
– Open minded
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Lifestyles
• Psychographics
• Includes activities,
interests, and opinions
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Discussion Questions
• How might you differ from a person with
similar demographics to yourself?
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VALS Segmentation
BELIEVERS
STRIVERS
INNOVATORS
SURVIVORS
THINKERS
• Be Indian,EXPERIENCERS
Buy Indian
ACHIEVERS
MAKERS
•• Are Are brand
Enjoyimage conscious
the finer
loyalthings
••• •Are not
Slowfor
Follow
Attracted
Shop interested
tofashion
change
comfort,
to premium in image
habits
durability, /value
products prestige
• Use Limited
Receptive
coupons incometo but
& watch new carry
for sale credit
products,
••Like Look educational
•Spend
balances
•technologies
Prime for
much
Unimpressed bargains
target &for
income
by &
distribution public
on of
variety
luxuries socializing
&productsaffair
buy basics
programming
• Trust advertising
•• •Buy Watch
Spend
Frequent TV
on more
vendors
ontoimpulse
Average
Listen TV
radio than
clothing
watchersof&average
personal
wide varietycare
of
•publications
Read
•products widely
Watch TV often & often
Readauto,
•• •Read
Heavy
Read retirement,
users
business of
home,news home & &
packaged
mechanics, selfgeneral
and
fishing,
help
interest
Prefer
Light
•outdoor TV
TV
electronic magazines
Read women
publications to reading
viewers
media
magazines magazines
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Socio-Cultural Values and Beliefs
• Sociological = group
• Anthropological = cultural
– Cultural values
– Sub-cultural membership
– Cross-cultural affiliations
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Consumption-Specific
Segmentation Bases
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Consumption-Specific
Segmentation
Usage-Behavior
• Usage rate
– Awareness status
– Level of involvement
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Consumption-Specific
Segmentation
Usage-Behavior
• Usage-situation segmentation
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Benefits Segmentation
• Benefits sought represent consumer needs
• Benefits of media
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Benefits Visiting Tourists Seek in
National Park
Segment Description
Environmentalists Interested in an unpolluted, un-spoilt natural environment
and in conservation. Not interested in socializing,
entertainment, or sports. Desire authenticity
and less man-made structures and vehicles
in the park.