Introduction

Define consumer needs

Identify customer segments
Position New products
Satisfying needs at individual level
Develop marketing strategies to communicate
benefits.
Evaluate strategies for effectiveness
Ensure such strategies do not mislead or deceive
consumers.
Evolution of Concepts
 Concepts
Production Concept Consumers prefer products that are widely
available and inexpensive. The production concept is more operations
oriented than any other concept. Click here to read more about the
Production Concept

Product Concept Consumers favour products that offer the most

quality, performance, or innovative features. The product concept
believes in the consumer and it says the consumers are more likely to
be loyal if they have more options of products or they get more
benefits from the product of the company. Click here to read more
about the Product Concept

Selling Concept Consumers will buy products only if the company

aggressively promotes or sells these products. Off course, in this era
of marketing, we know that selling is not the only tactic to sell your
product. You have to focus on marketing as well. Click here to read
more about the Selling Concept
 Marketing Concept Focuses on needs/wants of target
markets & delivering value better than competitors. The
marketing concept believes in the pull strategy and says that
you need to make your brand so strong that customers
themselves prefer your brand over every other competitor.
This can be achieved through marketing. Click here to read
more about the Marketing Concept

Societal Marketing concept Focuses on needs / wants of

target markets & delivering value better than competitors that
preserves the consumers and societys well-being. Click here
to read about the Societal Marketing concept
 4Ps Of Marketing
Product
Price
Place
Promotion
Product Life cycle
Core Marketing Concepts
Hierarchy of Needs
(Abraham Maslow)
 Definition
Consumer behaviour is the study of
individuals, groups, or organizations and all the
activities associated with the purchase, use and
disposal of goods and services, including the
consumer's emotional, mental and behavioural
responses that precede or follow these activities.
 .
Consumer behaviour entails "all activities
associated with the purchase, use and disposal of
goods and services, including the consumer's
emotional, mental and behavioural responses that
precede or follow these activities." The term,
consumer can refer to individual consumers or
organizational consumers. Consumer behaviour is
concerned with:
Purchase activities: how consumers acquire
products and services, and all the activities
leading up to a purchase decision, including
information search, evaluating goods and services
and payment methods
 Continued
Use or consumption activities: concerns the
who, where, when and how of consumption.

Disposal activities: concerns the way that

consumers dispose of products and packaging;
may also include reselling activities such as eBay
and second-hand markets
 Continued

Consumer behaviour analysis is the "use of

behaviour principles, usually gained
experimentally, to interpret human economic
consumption." As a discipline, consumer
behaviour stands at the intersection of
economic psychology and marketing science.
.
Emerged in the 1940s and 50s as a distinct
sub-discipline in the marketing area.
Consumer behaviour is an inter-disciplinary
social science that blends elements
from psychology, sociology, social
anthropology and Economics,
especially Behavioural Economics.

It examines how emotions, attitudes and

preferences affect buying behaviour.
 Continued

Characteristics of individual consumers such

as demographics, Personality, lifestyles and
behavioural variables such as usage rates, usage
occasion, loyalty, brand advocacy, willingness to
provide referrals, in an attempt to understand
people's wants and consumption are all
investigated in formal studies of consumer
behaviour.
 Continued

The study of consumer behaviour also

investigates the influences, on the consumer,
from groups such as family, friends, sports,
reference groups, and society in general.
 So to Conclude:

The study of consumer behaviour is concerned

with all aspects of purchasing behaviour - from
pre-purchase activities through to post-purchase
consumption, evaluation and disposal activities.
It is also concerned with all persons involved,
either directly or indirectly, in purchasing
decisions and consumption activities including
brand-influencers and opinion leaders.
 Market Segmentation

Market segmentation is the process of dividing

a market of potential customers into groups, or
segments, based on different characteristics. The
segments created are composed of consumers who
will respond similarly to marketing strategies and
who share traits such as similar interests, needs, or
locations.
 STP
Segmentation, targeting, and positioning
together comprise a three stage process.
(1) determine which kinds of customers exist,
then
(2) select which ones we are best off trying to
serve and, finally,
(3) implement our segmentation by optimizing
our products/services for that segment and
communicating that we have made the choice to
distinguish ourselves that way.
Market Segmentation Strategies
 Criteria for Effective Targeting of
Market Segments
Once we have done segmentation of the entire
pie of the market, we need to evaluate each
segment to know if we have done the
segmentation correctly. If the segmentation is
not proper the entire marketing plan may
backfire. For this there are various parameters
about a segment we need to check, they are:
 Continued

1.Substantial The segment should be sizeable

enough to make the firm profitable.

2.Measurable The segment should be such

that all its measurable characteristics like market
size, purchasing power, demand can be found
out.
 Continued
3.Accessible The segment should be such that the
product can reach the segment via distribution
channels and the promotions can reach them via
proper media.
4.Differential All the segments should be different
than each other and should not overlap. If they do,
they should come under one segment. That is if
more than one segments respond similarly to one
kind of marketing mix, they should grouped under
one segment.
5.Actionable The segments should be such that
effective marketing programs can be implemented.
.

Key Determinants of
Consumer Behaviour:
.

Personality
 General Meaning of Personality

The combination of characteristics

or qualities that form an individual's
distinctive character.
 Definition
Personality refers to individual differences in
characteristic patterns of thinking, feeling and
behaving. The study of personality focuses on two
broad areas:
One is understanding individual differences in
particular personality characteristics, such as
sociability or irritability.
The other is understanding how the various parts
of a person come together as a whole.
 DEFINITION

The inner psychological characteristics

that both determine and reflect how a
person responds to his or her
environment.
 The Nature of Personality

Personality reflects individual differences

Personality is consistent and enduring
Personality can change
 Discussion Questions

How would you describe your

personality.
How does it influence products that
you purchase .
 Theories of Personality
Freudian theory
Unconscious needs or drives are at the heart of
human motivation
Neo-Freudian personality theory
Social relationships are fundamental to the
formation and development of personality
Trait theory
Quantitative approach to personality as a set of
psychological traits
 Freudian Theory:
ID
Warehouse of instinctual needs for which
individual needs immediate satisfaction.
SUPEREGO
Individuals internal expression of societies moral
and ethical codes of conduct.
EGO
Individuals conscious control that balances the
demand of the id and the superego.
 Freudian Theory and
Product Personality
Beginning of 20th Century
(Sigmund Freud)
(Psychoanalytic Theory)
Consumer Researchers using Freud
personality theory see consumer
purchases as a reflection and extension
of the consumers own personality.
 Non-Freudian Personality Theory
Sigmund Freud Colleagues like:

1. Alfred Adler We seek goals to overcome feeling

of inferiority. (Style of Life)

2. Harry Stack Sullivan We continually attempt to

establish relationships with others to reduce
tensions. (Reduce Tension)
 Non-Freudian Personality Theory
Karen Horney was interested in child
parent relationships and desires to conquer
feelings of anxiety.

She proposed three personality groups:

 Continued:

Compliant: They move towards others

they desire to be loved, wanted and
appreciated.
Aggressive: They move against others.
Detached: They move away from
others.
 TRAIT THEORY
Trait Theory constitutes a major departure from
Freudian and non-Freudian movements.

This theory focuses on the measurement of

certain specific characteristics or traits.

Trait theorists are concerned with the

construction of personality tests (inventories) that
enable them to pinpoint individual differences in
terms of specific traits:
 Continued
These tests measure traits such as:

Consumer Innovativeness.

Consumer Materialism.

Consumer Ethnocentrism.
 Consumer Behaviour

PERCEPTION
 Definition.
Perception is defined as the process
by which an individual selects,
organizes and Interprets stimuli in to
a meaningful and coherent picture
of the world.
 The basic concepts underlying the
perception process are:

a) Sensation.
b) The Absolute Threshold.
c) The Differential Threshold.
d) Subliminal Perception.
 SENSATION
It is the immediate and direct response
of the sensory organs to stimuli.

An Stimuli may be products, Packages,

Brand Names, Advertisements and
Commercials etc.
 Sensory Receptors are:
a) Eyes
b) Ears
c) Nose
d) Mouth
e) Skin

They receive sensory Inputs.

No Sensation v/s Sensation
 Sensation(Cont.)
As sensory input decreases ,however our
ability to detect changes in input or intensity
increases, to the point that we attain
maximum sensitivity under conditions of
minimal stimulation

For Example:
It was so quiet I could hear a pin drop
 Sensation(Cont.)
Most of the marketing communications
today appeal to:

Sight.
Sound (Music).
Smell (2004,Nobel Prize).
Touching (Persuasive Tool).
 The Absolute Threshold
The Lowest point at which an individual
can experience a sensation is called
ABSOLUTE THRESHOLD.
or
Point at which an individual an detect a
difference between Something and
Nothing is that individuals Absolute
Threshold for that stimulus.
The Absolute Threshold
 EXAMPLES OF ABSOLUTE THRESHOLD

Vision - A candle flame 30 miles away

Hearing - A watch ticking 20 feet away
Smell - A drop of perfume in a 6-room
house
Taste - A teaspoon of sugar in a gallon of
water
Example
 Continued

The continuous exposure leds to

adaptation. Thus sensory adaptation
is a problem that concerns many
advertisers that is why marketers
change their advertising campaigns
regularly.
 Continued

In an effort to cut through the advertising

clutter and ensure that consumers notice
their advertisements, some marketers try
to increase sensory inputs.

This leds to the concept of :

 .

The
Differential
Threshold
 Definition
The minimum difference that can be detected
between two similar stimuli is called the
differential threshold or the Just noticeable
difference.(J.N.D).

Ernest Weber (19th Century)

 The Theory:
The J.N.D between two stimuli is not an
absolute amount but an amount relative to
the intensity of the first stimulus.

It also states that the stronger the initial

stimulus, the greater the additional
intensity needed for the second stimulus
to be perceived as different.
Webers law is important for Marketing due to two
reasons:
1. So that ve changes (Reduction in
size,quality,price) are not readily discernible to
the public. (Remain below the J.N.D).

1. So that +ve changes/Improvements (Updated

Packaging ,Lower price, Larger Size) are very
apparent to the consumers without being
wastefully extravagant (At or just above the
J.N.D)
Examples of J.N.D
 .

SUBLIMINAL
PERCEPTION