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Chapter 2:

Consumer Behavior & theMarketing Manager

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Managerial Application Areas

of Consumer Behavior:

Product ositioning and Product

Differentiation

nvironmental Analysis

Market esearch

Marketing- ix Development

egmentation of the Marketplace

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Product PositioningInfluencing how consumers perceive a

brands characteristics relative to those of

competitive offerings

Goal: influence demand by creating a

product with specific characteristics and a

clear image

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Product Differentiation

Consumers perceive meaningful differences

between a brand and its competitors

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Specific Positioning

Market Leaders

No mention of competitors

Competitive Positioning

Non-market leaders

Positioned in relation to market leader

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Perceptual Map

Simple Preparation

Involved Preparation

Healthy Unhealthy

Beef

Pork

Tuna

Chicken

Turkey

Fresh Fish

Bacon

Hot Dogs

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Environmental Analysis

The assessment of

the external forces

that act upon thefirm and its

customers, and that

create threats and

opportunities

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Components of the External

Environment

Demographic

Economic

Natural

Technological

Political

Cultural

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Demographics

The study of population changes and

subcultural values of various demographic

groups based on such factors as age, sex,

income, education, ethnicity, and geography

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Economic Environment Three Major Contributions of Behavioral

Economists:

Consumer sector of the economy canstrongly influence the course of the

aggregate economy Factors that influence the decision of

families to buy or save

Methodology for making predictions ofaggregate economic activities based uponconsumer surveys

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Natural Environment

Raw materials available

Pollution

Disease

Expansion of desert

regions around the globe

Weather phenomena

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Political Environment

Laws, regulations impact consumers.

Politically important national or internationaldevelopments.

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Cultural Environment

Customs

Values

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MARKET RESEARCH

Applied consumer research

Designed to provide management with

information about consumer behavior

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Product

Promotion

Pricing

Distribution

Marketing-Mix Development

The development and coordination ofactivities involving the:

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New Product Development Idea generation

Concept testing

Product development

Market testing

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Advertising and Personal

Selling Implications

Sales Promotion

Applications

Public Relations

Promotional Strategy

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Price Changes How will consumers react when companies

raise or lower the price of a product?

Principles of perception can be applied toanalyze if consumers will notice a

difference in price and if so, what effect it

has

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Product Distribution

Impacted by

understanding how

consumers make

their purchasing

decisions

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Market Segmentation

Subdividing the market

into distinct subsets of

customers

Similar needs and wants

Reached with a different

marketing mix

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Four Classifications of

Segmentation Variables:

Characteristics of the Person

Situation Geography

Culture and Subculture

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Characteristics of the Person Demographic Characteristics

Behavioral Segmentation

Benefit Segmentation

Usage Behavior

Psychographic and Personality

Characteristics

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Consumer Situations

Temporary environmental factors

Form the context within which a consumer

activity occurs

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Geographic Segmentation

Region

Census blocks

Size of cities and counties

Population density

Climate

Geodemographics: thecombination of geography

and demographics

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Culture and Subculture

Culture is the way of life of the people of a

society

Subculture is a subdivision of a national

culture and is based on some unifying

characteristic, such as social status ornationality

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Segmenting Industrial MarketsDifferent segmenting

variables are used to

classify companiesinto segments

including the North

American Industry

Classification System(NAICS).

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Solving Managerial Problems

. . . is a four-step process:

1. Gather information and identify the

problem/opportunity

2. Identify the relevant consumer behavior

concepts and how they apply to the

problem

3. Develop a managerial strategy

4. Summarize the managerial

recommendations