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Measurement of Consumer Beh..

Measurement of Consumer Beh..

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Published by Piper John Dasooza

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Categories:Types, Business/Law
Published by: Piper John Dasooza on Mar 19, 2009
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Consumer Behavior Faculty: J.Rai
 The study of consumers helps firms and organizations improve theirmarketing strategies by understanding issues such as how
 The psychology of how consumers think, feel, reason, and selectbetween different alternatives (e.g., brands, products);
 The the psychology of how the consumer is influenced by his or herenvironment (e.g., culture, family, signs, media);
 The behavior of consumers while shopping or making other marketingdecisions;
Limitations in consumer knowledge or information processing abilitiesinfluence decisions and marketing outcome;
How consumer motivation and decision strategies differ betweenproducts that differ in their level of importance or interest that theyentail for the consumer; and
How marketers can adapt and improve their marketing campaigns andmarketing strategies to more effectively reach the consumer.One "official" definition of 
consumer behavior
is "The study of individuals,groups, or organizations and the processes they use to select, secure, use,and dispose of products, services, experiences, or ideas to satisfy needs andthe impacts that these processes have on the consumer and society."Although it is not necessary to memorize this definition, it brings up someuseful points:
Behavior occurs either for the individual, or in the context of a group(e.g., friends influence what kinds of clothes a person wears) or anorganization (people on the job make decisions as to which productsthe firm should use).
Consumer behavior involves the use and disposal of products as wellas the study of how they are purchased. Product use is often of greatinterest to the marketer, because this may influence how a product isbest positioned or how we can encourage increased consumption.Since many environmental problems result from product disposal (e.g.,motor oil being sent into sewage systems to save the recycling fee, orgarbage piling up at landfills) this is also an area of interest.
Consumer behavior involves services and ideas as well as tangibleproducts.
 The impact of consumer behavior on society is also of relevance. Forexample, aggressive marketing of high fat foods, or aggressivemarketing of easy credit, may have serious repercussions for thenational health and economy.
There are four main applications of consumer behavior
:
 The most obvious is for
marketing strategy 
—i.e., for making bettermarketing campaigns. For example, by understanding that consumersare more receptive to food advertising when they are hungry, we learnto schedule snack advertisements late in the afternoon. Byunderstanding that new products are usually initially adopted by a fewconsumers and only spread later, and then only gradually, to the rest
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Consumer Behavior Faculty: J.Rai
of the population, we learn that (1) companies that introduce newproducts must be well financed so that they can stay afloat until theirproducts become a commercial success and (2) it is important toplease initial customers, since they will in turn influence manysubsequent customers’ brand choices.
A second application is
 public policy 
. In the 1980s, Accutane, a nearmiracle cure for acne, was introduced. Unfortunately, Accutaneresulted in severe birth defects if taken by pregnant women. Althoughphysicians were instructed to warn their female patients of this, anumber still became pregnant while taking the drug. To get consumers’attention, the Federal Drug Administration (FDA) took the step of requiring that very graphic pictures of deformed babies be shown onthe medicine containers.
Social marketing
involves getting ideas across to consumers ratherthan selling something. Marty Fishbein, a marketing professor, went onsabbatical to work for the Centers for Disease Control trying to reducethe incidence of transmission of diseases through illegal drug use. Thebest solution, obviously, would be if we could get illegal drug users tostop. This, however, was deemed to be infeasible. It was alsodetermined that the practice of sharing needles was too ingrained inthe drug culture to be stopped. As a result, using knowledge of consumer attitudes, Dr. Fishbein created a campaign that encouragedthe cleaning of needles in bleach before sharing them, a goal that wasbelieved to be more realistic.
As a final benefit, studying consumer behavior should make us betterconsumers. Common sense suggests, for example, that if you buy a 64liquid ounce bottle of laundry detergent, you should pay less per ouncethan if you bought two 32 ounce bottles. In practice, however, youoften pay a size
 premium
by buying the larger quantity. In other words,in this case, knowing this fact will sensitize you to the need to checkthe unit cost labels to determine if you are
really 
getting a bargain. There are several units in the market that can be analyzed. Our main thrustin this course is the
consumer 
. However, we will also need to analyze our ownfirm’s strengths and weaknesses and those of 
competing firms
. Suppose, forexample, that we make a product aimed at older consumers, a growingsegment. A competing firm that targets babies, a shrinking market, is likely toconsider repositioning toward our market. To assess a competing firm’spotential threat, we need to examine its assets (e.g., technology, patents,market knowledge, awareness of its brands) against pressures it faces fromthe market. Finally, we need to assess conditions (the marketingenvironment). For example, although we may have developed a product thatoffers great appeal for consumers, a recession may cut demand dramatically.So my conclusion about the measurement of consumer behavior is theimpact of consumer behavior on society is also of important. For example,aggressive marketing of high fat foods, or aggressive marketing of easycredit, may have serious effect for the national health and economy.
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Consumer Behavior Faculty: J.Rai
is often needed to ensure that we produce what customersreally want and not what we
think 
they want.
Primary vs. secondary research methods
. There are two mainapproaches to marketing.
Secondary 
research involves using informationthat others have already put together. For example, if you are thinking aboutstarting a business making clothes for tall people, you don’t need to questionpeople about how tall they are to find out how many tall people exist—thatinformation has already been published by the U.S. Government.
Primary 
research, in contrast, is research that you design and conduct yourself. Forexample, you may need to find out whether consumers would prefer thatyour soft drinks be sweater or tarter.Research will often help us
reduce risks
associated with a new product, but it
cannot take the risk away entirely 
. It is also important to ascertain whetherthe research has been complete. For example, Coca Cola did a great deal of research prior to releasing the New Coke, and consumers seemed to preferthe taste. However, consumers were
not 
prepared to have this drink replacetraditional Coke.
Secondary Methods
. For more information about secondary marketresearch tools and issues, you can referhttp://buad307.com/PDF/Secondary.pdf .
Primary Methods
. Several tools are available to the market researcher—e.g., mail questionnaires, phone surveys, observation, and focus groups.Referhttp://buad307.com/PDF/ResearchMethods.pdfor advantages anddisadvantages of each.
Surveys
are useful for getting a great deal of specific information. Surveyscan contain open-ended questions (e.g., “In which city and state were youborn? ____________”) or closed-ended, where the respondent is asked to selectanswers from a brief list (e.g., “__Male ___ Female.” Open ended questionshave the advantage that the respondent is not limited to the options listed,and that the respondent is not being influenced by seeing a list of responses.However, open-ended questions are often skipped by respondents, andcoding them can be quite a challenge. In general, for surveys to yieldmeaningful responses, sample sizes of over 100 are usually required becauseprecision is essential. For example, if a market share of twenty percent wouldresult in a loss while thirty percent would be profitable, a confidence intervalof 20-35% is too wide to be useful.Surveys come in several different forms. Mail surveys are relativelyinexpensive, but response rates are typically quite low—typically from 5-20%. Phone-surveys get somewhat higher response rates, but not manyquestions can be asked because many answer options have to be repeatedand few people are willing to stay on the phone for more than five minutes.
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