Scanning the Marketing Environment

by

KOTLER ON MARKETING

Today you have to run faster to stay in place.

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MICRO ENVIRONMENT FORCES

The Company
Suppliers Marketing

Intermediaries Customers Competitors Publics

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MACRO ENVIRONMENT FORCES

Demographic

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Environment Economic Environment Socio Cultural Environment Natural Environment Technological Environment Political Environment

Analyzing Consumer Markets by

KOTLER ON MARKETING
The most important thing is to forecast where customers are moving, and be in front of them.
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THE BUYING DECISION PROCESS

Problem Recognition
May be triggered

internally or externally
Information Search
Heightened attention

(simply becoming more receptive) Active information search (asking people)

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THE BUYING DECISION PROCESS

Evaluation of Alternatives In evaluation, the consumer sees each product as a bundle of attributes with varying abilities for delivering the benefits sought to satisfy this need
Cameras: Picture sharpness,

camera speed, size, price Hotel: Location, cleanliness, atmosphere, price

Purchase Decision Intervening factors

Attitude of others Consumer reports 3-8 Unanticipated situational factors

THE BUYING DECISION PROCESS

Post Purchase Use and

Disposal
Monitoring how buyers use and

dispose of the product can help to increase the frequency of purchase by

Tying the act of replacing the

product to a certain holiday To provide better information as to either When the product was first used or would need to be replaced The current level of performance
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TYPES OF BUYING DECISION BEHAVIOUR

Buying behavior differs greatly for a tube of tooth paste, a tennis racket, financial services and a new car. High Involvement Significant Differences between Brands Complex buying behavior Low Involvement Variety-seeking buying behavior

Few Differences between Brands

Dissonancereducing buying behavior

Habitual buying behavior

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TYPES OF BUYING DECISION BEHAVIOUR

High Involvement Significant Differences between Brands Complex buying behavior

Low Involvement Variety-seeking buying behavior

Few Differences between Brands

Dissonancereducing buying behavior

Habitual buying behavior

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COMPLEX BUYING BEHAVIOUR

Consumers undertake complex buying

behaviour when they are highly involved in a purchase and perceive significant differences among brands Consumers may be highly involved when the product is expensive, risky, purchased infrequently and highly self expressive Typically , the consumer has much to learn about the category and will pass through a learning process Example : Car, Computer Implication: Should help buyers learn about product class attributes. They may motivate sales people to influence the final brand choice.
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TYPES OF BUYING DECISION BEHAVIOUR

High Involvement Significant Differences between Brands Complex buying behavior

Low Involvement Variety-seeking buying behavior

Few Differences between Brands

Dissonancereducing buying behavior

Habitual buying behavior

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DISSONANCE REDUCING BUYING BEHAVIOR

Consumers undertake dissonance reducing behaviour when they are highly involved in a purchase and perceive few differences among brands Consumers may be highly involved when the product is expensive, risky, purchased infrequently and highly self expressive Buyers may consider most brands (in a category) in a given price range to be the same. They may respond primarily to a good price or convenience. After the purchase, consumers might experience post purchase dissonance Example : carpet, medicine Implication: Price / convenience element, and counter dissonance .
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TYPES OF BUYING DECISION BEHAVIOUR

High Involvement Significant Differences between Brands Complex buying behavior

Low Involvement Variety-seeking buying behavior

Few Differences between Brands

Dissonancereducing buying behavior

Habitual buying behavior

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HABITUAL BUYING BEHAVIOUR

Consumers undertake habitual buying behaviour when they are not much involved in a purchase and perceive few differences among brands Consumers may be not be involved when the product is inexpensive, less risky, purchased frequently and so on. As buyers have little involvement, they simply go to the store and reach for a brand. If they keep on buying the same brand, its out of habit rather than strong brand loyalty. Consumer do not search extensively and passively receive information. Ad repetition creates brand familiarity rather than conviction. Example : salt, pulses, sugar, bread
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HABITUAL BUYING BEHAVIOUR

Implication:
Because of low involvement and few differences, marketers use price and sales promotion to stimulate product trial In advertising, ad copy should stress only few key points Visual symbols and imagery are more important as they can be remembered easily Television is more effective than print media because it is a low involvement medium suitable for passive learning Can also convert LOW involvement product in to one of HIGHER (or medium) Involvement.
By linking the product to some involving issue (cavity) By linking to some personal situation (vitamins, calcium) Strong advertising to trigger strong emotions related to personal values Add important feature
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TYPES OF BUYING DECISION BEHAVIOUR

High Involvement Significant Differences between Brands Complex buying behavior

Low Involvement Variety-seeking buying behavior

Few Differences between Brands

Dissonancereducing buying behavior

Habitual buying behavior

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VARIETY-SEEKING BUYING BEHAVIOUR

Consumers undertake variety seeking buying behaviour when they are not much involved in a purchase and perceive high differences among brands Consumers may be not be involved when the product is inexpensive, less risky, purchased frequently and so on. Consumers often do a lot of brand switching. Brand switching occurs for the sake of variety rather than dissatisfaction. Example : cookies, ice cream, candies, restaurants Implications:
Market leader : Will try to encourage habitual buying bahaviour by dominating shelf space, various versions, avoiding out stock conditions, frequent reminder advertising. Market challenger: Lower prices, deals, coupons, free samples, advertising. 3-19

VIDEO SESSION

Consumer Psychology in a recession

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QUIZ NEXT SESSION

MCQs

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