LESSON 5 people about the purchase and use of products affects

buying decision.
CONSUMER BUYING BEHAVIOR 4. ATMOSPHERIC IN THE PHYSICAL SURROUNDING -
Physical surroundings which includes point-of-purchase
- Solely for the purpose of satisfying their needs. display, color, smell, music, crowds, promotional deals, and
stock out.
CONSUMER MARKET – market where peoply buy products for 5. ANTECEDENT STATES - Antecedent states are features of
personal use and are not intended for further sale to other people. the individual that are not lasting or relatively enduring
characteristics, which includes:
NOTE: Basic types of consumer market includes food and beverages,
 Momentary moods
retail stores, fast moving consumer products and transportation.
 Momentary condition
CONSUMER BUYING PROCESS – sequence of steps that a
consumer will need to undergo in order to arrive at final purchasing
decision PSYCHOLOGICAL INFLUENCES

1. Problem recognition – This step is also recognized as 1. MOTIVATION - Motivation of an individual to act is based on
identification of unmet needs: importance of need, identified as follows:
 recognized as identification of unmet needs.
 market perspective – problem recognition creates
opportunity.  Physiological Needs
 Safety and Security
2. Information search- consumer will attempt to look for
 Love and Belongingness
information coming from one or more sources:
 Esteem
 *personal sources  Self-Actualization
 *commercial sources
 *public sources 2. PERCEPTION - The perception is the process by which the
individual chooses, sort out, and takes meaning to the
 *experimental sources
information. There are different process that leads to
3. Evaluation of alternatives – certain criteria will be used the perception:
consumer in evaluating alternatives: 1) Selective Attention,
2) Selective Distortion , and
 *benefits 3) Selective Retention
 *qualities
 *price changed 3. LEARNING - Learning is an expensive experience and
practices that in reality changes behavior of any consumer.
 *past records
 *attractiveness
4. VALUES, BELIEFS, AND ATTITUDES - Belief is a promise
 *product related services a person holds about something. Attitude is a constant view
of something that includes the belief and emotional feeling
4. Purchase decision – several factors that contributes on the
and related behavior.
decision of the consumer to avoid, modify, or postpone a purchase
decision:
PERSONAL INFLUENCES
1. Attitudes of others
2. Unanticipated situational factors 1. AGE - The consumer buying behavior is greatly
3. Consumer’s perceived risk influenced by his age. Consumers buy different
products in different stages of the life cycle.
5. Purchase – consumer must settle on the following: 2. EDUCATION - Education has an impact on the level of
judgement consumers apply when buying. Educated
 *from whom they should buy people have higher level of judgement they apply when
 *when to buy purchasing.
 *consumer may to delay or abolish purchase 3. OCCUPATION - An individual's nature of job has a
direct influence on the products and brands he picks for
6. Post-purchase evaluation - After purchase is made, it is expected himself. People tend to buy product that promote their
that customer would evaluate the experience. Here are some few profession and role to the society.
thing's that a marketer should check about post-purchase experience: 4. LIFESTYLE - Lifestyle is the way an individual stays in
the society. Lifestyle means individual's interests
 *Post-Purchase Satisfaction values, opinions, and activities that reflect the manner
 *Post-Purchase Action in which he lives in the society.
 *Post-Purchase Use and Disposal
SOCIO-CULTURAL INFLUENCES

1) REFERENCE GROUPS - A Reference Group is a group with

SITUATIONAL INFLUENCES which an individual likes to be associated with, and be called
as a member of the group. Roles within reference groups:
1. TEMPORAL PERSPECTIVE - Time is the focus of temporal 1) Initiator,
perspective. Time is very vital to customers. Here are some 2) Influencer,
forms on how time can affect shopping: 3) Decision-Maker,
 *TIME PRESSURE 4) Buyer
 *TIME OF YEAR 1. ROLES AND STATUS - Status is the position a
 *TIME OF DAY person occupies in a particular situation. Roles is
the set of norms, values, behaviors, and
2. PURCHASE TASK - Purchase task means the buying personality characteristics connected to a status
intention or reason behind the purchasing decision of a
certain product or service.
3. SOCIAL SURROUNDING - Often times, a purchase
decision is influenced by the presence of other members of
the society while in a shopping activity. The opinion of these
 2. FAMILY - Family members highly influenced one's
preferences and behavior. In reality, a person
passes through two types of families, namely:
 Family of Orientation
 Family of Procreation
3. SOCIAL CLASS - Social class is where an
individual belongs in a society. Social class is
relatively permanent and ordered division in a
society where members share the same value,
interest, and behavior.
4. CULTURE - Culture refers to the beliefs, customs,
rituals, and practice that a particular group of
people follows.
ECONOMIC INFLUENCES
1. PERSONAL INCOME - The income of the person influences
his buying patterns. It is the income of a consumer that
dostates his purchasing power. The personal income a
person has, the more he can spend on a lot of items. The
contrary is true to people with less income.
2. FAMILY INCOME - The family income refers to the
combined sum of the income of all the family members. The
residual income after purchasing all the basic necessities of
everyday life may be utilized to buy shopping goods.
3. INCOME EXPECTATION - An individual's anticipation about
his increase income level in the future influences his buying
behavior today.
4. CONSUMER CREDIT - The credit facility obtainable to the
consumer influences his buying behavior. If the credit term is
liberal, then consumers are likely to spend more on the
extravagant items. This credit is offered thru banks and other
financial institutions.
5. LIQUID ASSETS AND SAVINGS OF THE CONSUMER -
The liquid assets with the consumer have an influencein his
buying behavior. The liquid assets are the assets that are
easily redeemable into the cash.
LESSON 6
SEGMENTATION, POSITIONING, AND TARGET MARKETING
Segmentation, targeting, and positioning or simply STP has
an important role in getting to the right customer. These three serve as
tools to align products/services with the right customers.
Segmentation classifies the customers into groups with similar
needs and wants so that companies can be able to use its limited
resources.
Target Market is basically a particular segment of customers
where marketing is directed following the right segmentation.
Positioning is creating a brand image in the mind of the
customer for customer retention and more customer delight.
Segmentation entails discovering what types of consumers with
diverse need exist.
In general, marketing professionals have three approaches in
meeting the needs of customers which are:
2) Undifferentiated strategy - consumers are treated the
same.
3) Concentrated strategy - company chooses to focus,
specialize, and target only one segment of the market.
4) Differentiated strategy - company is trying to sell to two or
more specific market segments' consumers that are treated
in different ways.
In order to determine the appropriate bases for segmenting market, the
beginning task is to find out the variables that divide the heterogenous
market into homogenous segments of similar wants and needs.
The are two types of segmentation approaches:
Needs based approach - market is segregated into different segments
according to similar nature of needs.
Profilers' approach - profilers are descriptive in nature and measurable
in terms of customer characteristics which can be used to update a
segmentation exercise. (geographic, demographic, psychographic,
and behavioral variables).
CRITERIA FOR SUCCESSFUL SEGMENTATION
1. SEGMENT MUST BE MEASURABLE - Market research
must be able to find out the accurate size of market
segment.
2. SEGMENT MUST BE ACCESSIBLE - Market segments
should be easily to reached in terms geography and
economy.
3. SEGMENT MUST BE SUBSTANTIAL - A substantail market
segment should be sufficiently large to have enough
spending power for the company to sustain itself.
4. SEGMENT MUST BE ACTIONABLE/RESPONSIVE -
Market segement that warrants action should have practical
value.
5. SEGMENT MUST BE SPECIFIC/DIFFERENTIABLE -
Market segment must be internally homogenous.
CONSUMER MARKET
SEGMENTATION
Consumer market pertains to buyers who purchase
goods and services for consumption rather than resale.
There are several ways to segment the market in
order to reach the most ideal consumers for certain products
or services. Some of these include demographic
segmentation, psychographic segmentation, behavioral
segmentation, and geographic segmentation.
1. DEMOGRAPHIC CHARACTERISTICS -
Demographic variables entaiil but are certainly not
limited to grouping consumers with regard to their
gender, age, ethnic background, income, occupation,
education, household size, religion, generation, marital
status, nationality, and even social class.
2. PSYCHOGRAPHIC CHARACTERISTICS -
Psychographic variables covers lifestyle, personality,
interests, activities, opinions, values, and attitudes.
Values and LIfestyle (VALS) is a useful tool for
evaluation psychographic variables. It segments adults
into eight distinct types or mindset using specific set if
psychological traits and key demographics that drives
consumer behavior.
Eight types of consumer:
1. Innovators,
2. Thinkers,
 3. Believers, 4. PRODUCT USER - This deals with positioning a product
4. Achievers, keeping in mind a specific user or a class of users.
5. Strivers, 5. PRODUCT CLASS - Positioning by product class is an
6. Experiencers, essential marketing approach because a business can gain
7. Makers, and more consumer publicity by offering a product that works
8. Survivors. with or has a connection to a first product they may know
and trust.
6. CULTURAL SYMBOLS - Cultural symbols identifies
3. BEHAVIORAL CHARACTERISTICS -
something that is very meaningful to the people that other
Behavioral characteristics of consumer markets consist
competitors are not using abd associate this brand with the
of product usage rates, brand loyalty, user status or
symbol.
how long they have been a customer, and even
7. COMPETITORS - An implicit or explicit frame of reference to
benefits that customer seek.
one or more competitors.

1. Usage Rate: Heavy Users, Mid-level Users, and

Light Users
2. Brand Loyalty: Applicant, First-time buyer, WRITING A POSITIONING STATEMENT
Frequent buyer, Promoter, and Loyal Customer
A positioning statement is a brief and concise description of a
3. Occassions: Universal, Regular-personal, and
target market and a compelling picture of how a company wants its
Rare-personal
targeted market to perceive its brand.
4. User Status: Non-users, Prospects, First-time
buyers, Regular users, and Defectors A good positioning statement is a guidepost for all marketing
efforts. It helps a company maintains concentration on its brand and its
4. GEOGRAPHIC CHARACTERISTICS - value proposition as it works on market strategy and tactics.
Geographic segmentation is the practice of segmenting
a campaigns target audience based on where they are SIX IMPORTANT FACTORS IN WRITING A GOOD POSITIONING
located. STATEMENT

1. It is straightforward, impressive, and fitted to the target

Factors under geographic segmentation:
 Climate,
 Population Density,
 Cultural Preferences
SELECTING TARGET MARKETS
Target marketing entails diving a market into segments and
then focusing all marketing efforts on one or few key segments
comprising of those customers whose needs and desires match very
well a company's product or service offerings.
There are several approaches to target marketing:
Undifferentiated Targeting -company selects the whole market as
one big market with no individual segments.
market.
2. It offers an instantly recognizable and simply understood
picture of a brand that differentiates it from its competitors.
3. It is believable, and the brand can fulfill on its promise.
4. A brand can be the only occupier of this particular position in
the market, so "own it.
5. It helps a company evaluates whether or not marketing
decisions are reliable with and supportive of its brand.
6. It provides opportunity for growth.
REPOSITIONING
Repositioning involves an attempt to transform consumer
perception of a brand, generally because the current position that the
brand holds has turned into less attractive.

Multiple Segment Targeting - company selects two or more Repositioning could have the following benefits:
segments to go after.
 Stronger competitive position
Concentrated Targeting/Niche - focuses on one or a few segments
 Enhanced sales
or niche in a market.
 Clearer target market
Micromarketing - tailoring the marketing programs and products to  Better aligned to present market needs
suit the needs and wants of specific locations of specific individuals.  Possible media attention

POSITIONING STRATEGIES REPOSITIONING STRATEGIES

Positioning is the space a brand occupies in the brains of  SAME PRODUCT AND TARGET MARKET, CHANGE IN
customers. It makes customers view a product in an exceptional and THE IMAGE OF THE PRODUCT
distinctive way and makes it stand out from the competition. It is the  INTANGIBLE - TARGET DIFFERENT MARKET
reason why the customers buy product or service. Positioning involves SEGMENTS WITH THE SAME PRODUCT
implementing the market targeting.  PRODUCT REPOSITIONING
 TANGIBLE - PRODUCT AND TARGET MARKET
APPROACHES TO POSITIONING STRATEGIES CHANGED
1. PRODUCT CHARACTERISTICS/CUSTOMER BENEFITS -
This strategy basically concentrates on attributes of the
product or customer benefits. CHALLENGES OF REPOSITIONING
2. PRICING QUALITY - Customer perceived that if the product
is expensive, it provides high quality. And if inexpensive, it 1. DEVELOPMENT COST
provides lower quality. 2. SIGNIFICANT COST OF RE-EDUCATING THE MARKET
3. USE OR APPLICATION - Positioning a product on the basis 3. LOSS OF CURRENT SALES
of its use or application is done intentionally to a make a 4. CONFUSED POSITIONING
bigger brand in the market. 5. DECISION OF REPOSITIONING AGAINST A NEW
OFFERING
6. COMPETITIVE ACTIONS
7. BRAND RISK