ASSIGNMENTS MK0002 (2 credits) Set 1 Marks 30 Consumer Behavior
Q.1 Two companies produce different lines of furniture. One company directs its line toward upper middle class consumers, the other to lower middle class consumers. What are likely to be the differences in a) Product styles and features b) Print media used for advertising and c) Distribution outlets and in-store environment? Ans: a) Product styles and features :
b) Print media used for advertising :
c) Distribution outlets and in-store environment:
Q. 2 Describe two situations in your own experience when Selective Attention and Selective Blocking perceptual processes occurred. What are the implications for marketing strategy? Ans: Selective Attention: Even when the customer is forced to look at an advertisement about a product which is of no interest to him/ her, the consumer may still ignore it. A person’s interest may be initially attracted by the stimulus characteristics, but beyond initial attention the customer’s further processing of this information from the stimulus depends on the personal interest in the featured product or service. 1. Sometimes that relates to a current needExample: If you are planning to buy a stereo system, you are more likely to notice ads for stereo systems or displays of stereo systems in an electronic shop. 2. Something that we expect to seeExample: People are more likely to notice something that they expect to see. If you enter a bookshop which also stocks music CDs, chances are that you may not notice the music, since you will be expecting to see only books. 3. Something that is unusualExample: People are more likely notice something which differs from the ordinary. An ad which is in bold print or a TV commercial that is louder than normal is bound to attract more attention. Selective Blocking: Consumers tend to protect themselves from being bombarded with stimuli, by simply ‘tuning out’ – blocking such stimuli from conscious awareness. People skipping the TV commercials while watching their favorite programmes by tuning to other channels, is an example of selective blocking. Q. 3 Describe the steps in the consumer decision making process for each of the following cases – a) A businessman considering the purchase of a new mobile phone for communication between branches of his firm and b) A consumer considering the purchase of a headache remedy that is advertised as stronger and more effective. Ans:
a) Step-1: Problem recognition: A businessman wanted to purchase of a new mobile phone for communication between branches of his firm. Here the problem is recognized and also solution is identified. Step-2: Information search: Now businessman search information for the best brand of mobile phones which suited his business needs at lower price. Step-3: Evaluation of alternative: The businessmen go for some other advanced option for communication such as LAN networking or internet. They may evaluate the alternative cost wise, efficiency wise and suitability wise. Here in this case the decision has been taken for mobile phones. Step-4: Purchase: In this step the businessmen decided the brand of mobile to be purchased. After selecting the brand he finally takes the decision to purchase it from convenient place/stores. Step-5: Post- purchase Evaluation: After the use of the purchased mobile the businessman takes the performance appraisal of
the mobile from his staff. He enquire the durability of hardware and software, service of TSP(Telecom service provider) and the servicing of mobile in case of faults.
b) Step-1: Problem recognition: A consumer wanted to purchase of a headache remedy that is advertised as stronger and more effective. Step-2: Information search: Here the information is advertised so this step not required. Step-3: Evaluation of alternative: Here this step is also not require as the decision is already taken to purchase the advertised medicine. Step-4: Purchase: He finally purchases the medicine from the store which advertised it. Step-5: Post- purchase Evaluation: In this step consumer analyze the claims in advertisements are true or not. Is the pill is really effective for headache? Is the penny paid for it is justified? etc
ASSIGNMENTS MK0002 (2 credits) Set 1 Marks 30 Consumer Behavior
Q.1 Assume that the following new products are being launched in the market – a) Electric car and b) Pocket calculators. Based on the five characteristics of innovations, what prediction could you make regarding the speed of adoption of these products? Ans: The Five Characteristics of innovation: The five characteristics of innovation are: 1. Relative advantage 2. Compatibility 3. Complexity 4. Divisibility 5. Observe-ability A. Electric Car: Electric car has several advantages over petrol car. i.e. Environment familiar, less money to run. But it has several disadvantages like complex, new technique less faith and also less speed. So this product takes long time to penetrate the market. We all know that Reeva electric car and electric motor bikes are total failure in India due to electricity problem. B. Pocket calculator: This product can easily penetrate the market as it is portable, less complex and it requires less investment to try. Q. 2 Select an example of an industrial buying decision. List out and briefly explain five similarities and five differences between the industrial decision process you have selected and the consumer decision process. Ans: Industrial buying decision in auto industry: In particular, we wish to understand the economic incentives and constraints that determine the make buy decision of the automotive assemblers. Several important changes have been happening in the automotive industry during the past decade. The most prominent one has been the rise of the supplier industry. From small players that manufactured individual parts, suppliers have grown to be partners of the assemblers, with design, testing, and manufacturing responsibilities, and an increasing global presence. Similarities and differences between industrial decision process and consumer decision process. S.No. Similarities differences
Evidence of business and industrial marketers engaging in meta- thinking is more substantial compared to household consumers. 2. For repetitive decision-making contexts, categorization rules are more often formalized in writing by executives but not by consumers. 3. All decision makers appear to create and use Formal, written, evaluation and choice simplifying decision rules when faced with two or rules are created and applied more often more alternatives. by professional buyers compared to household buyers. 4. Decisions are often made in groups of two or more Formal procedures are enacted often persons both in industrial and household buying. within industrial firms but not in households for meetings to frame problems. 5. Post- experience evaluations and assessments of Performance audits of suppliers, satisfaction occur often among both industrial and products purchased and the professional households. buyers employed by the organized are done more frequently by industrial firms and rarely, if ever, done by household. Q. 3 Which behavioral variables could be used to segment the following markets? – a) Soft drinks b) Household cleaners and c) Credit cards. Ans: Behavioralistic Segmentation Behavioral segmentation is based on actual customer behavior toward products. Some behavioralistic variables include:
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Thinking, deciding and actions by marketing and purchasing by industrial buyers and household consumers often include automatic as well as conscious processing of information. Both industrial and consumer buyers apply simplifying categorizing rules for decision contexts.
Benefits sought Usage rate Brand loyalty User status: potential, first-time, regular, etc. Readiness to buy Occasions: holidays and events that stimulate purchases Behavioral segmentation has the advantage of using variables that are closely related to the product itself. It is a fairly direct starting point for market segmentation.
Here the variable User Status is used to segment the market. It is so because all above product is used by upper class family.