Chapter 1: Introduction to Consumer Behavior and Marketing Strategy

How can consumer behavior research help internet marketers increase their chances of success?
 Through marketing concept.
 Through marketing concept, organizations should satisfy consumer needs and wants to make
profits.
 In order to implement this, organizations must understand their customers and stay close to them
to provide products and services that consumers will purchase and use appropriately.

Companies are making changes to serve consumers better for three major reasons:
1. Company focus on providing consumer with value- laden products has spurred other companies to
follow.
2. Dramatic increase in the quality of consumer and marketing research.
3. Increased emphasis on consumers is the development of the Internet as a marketing tool.

In sum, many companies have recognized the importance of consumers and have sophisticated
approached and detailed data from which to develop organizational and marketing strategies.

What is Consumer Behavior?

The American Marketing Association defines consumer behavior as:
 The dynamic interaction of affect and cognition, behavior, and the environment by which
human beings conduct the exchange aspects of their lives.
 In other words, it involves thoughts and feelings people experience and actions they perform in
the consumption processes.
 Consumer behavior entails all consumer activities associated with the purchase, use, and disposal
of goods and services, including the consumer’s emotional, mental, and behavioral responses
that precede, determine, or follow these activities
 Includes all things in the environment that influence thoughts, feelings, and actions.
Comments from other consumers
Advertisements
Price information
Packaging
Product appearance
Consumer Behavior is Dynamic.
 Thinking, feelings, and actions of individual consumers, targeted consumer groups, and society at large
are constantly changing.
 Requires ongoing consumer research and analysis of important trends.
 Makes development of marketing strategies difficult and exciting.
 Shorter product life-cycle increases importance of constant innovation. This involves creation to
create superior value for customers and stay profitable.
Consumer Behavior Involves Interactions.
 Interactions among people’s thinking, feelings and actions, and the environment
 Marketers need to understand:
 What products and brands mean to consumers?
 What consumers must do to purchase and use them?
 What influences shopping, purchase, and consumption?
Consumer Behavior Involves Exchanges
 Exchange between people involves giving up of something of value and receiving something in return.
 Role of marketing in society is to help create exchanges by formulating and implementing
marketing strategies.

Approaches to Consumer Behavior Research

 1. Interpretive Approach
 Based on theories and methods from cultural anthropology.
 Objective is to understand consumption and its meanings.
 Methods of study involve:
 Long interviews
 Focus groups
2. Traditional Approach
 Based on theories and methods from cognitive, social, and behavioral psychology, and
sociology.
 Objective is to develop theories and methods to explain consumer decision making and behavior.
 Methods of study involve:
 Experiments
 Surveys
3. Marketing science Approach
 Based on theories and methods from economics and statistics.
 Objective is to develop and test mathematical models to predict the impact of marketing
strategies on consumer choice and behavior.
 This method of study has become popular in the consumer packaged goods industry since it can
handle large scanner data sets.

Uses of Consumer Behavior Research

 As shown below, three groups- marketing organizations, government and political organizations and
consumers- use knowledge about consumer behavior and consumer behavior research. Each group is
interested in consumer behavior as it influences the consumer’s interactions and exchanges with other
group.

Relationship among Action- Oriented Groups interested in Consumer Behavior

Three groups use knowledge about consumer behavior and consumer behavior research
1. Marketing organizations
 Businesses attempting to sell products.
 Organizations that seek exchanges with consumers.
2. Government and political organizations
 Major concern is monitoring and regulating exchanges between marketing organizations and
consumers.
3. Consumers
 Includes consumers and organizational buyers who exchange resources for various goods and
services.
  Interests in making exchanges that help them achieve their goals and the understanding of their
own behavior.

Consumer Behavior’s Role in Marketing Strategy

Marketing strategy
 Design, implementation, and control of a plan to influence exchanges to achieve organizational
objectives.
 In consumer markets, these are designed to:
 Increase chances of favorable thoughts and feelings of particular products, services and brands
among consumers.
 Increase chances of trial and purchase.
 Developed by manufacturers, retail stores, catalog retailers, e-tailers and other direct marketers to:
 Increase chances of favorable thoughts and feelings among consumers about purchasing from
them.
 Increase chances of actual purchase.
 Developed by companies that make funds available for purchase to:
 Increase chances of usage of services offered by consumers.
 Marketing strategies involve developing and presenting marketing stimuli directed at selected target
markets to influence:
 What they think?
 How they feel?
 What they do?
 Essence of marketing strategy is to understand markets, develop and implement superior strategies to
attract and hold them profitably.
 Powerful force on consumers and society at large
 The power of marketing and the ability of consumer research and analysis to yield insight into
consumer behavior should not be discounted or misused.