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Lectu

MKT509
Consumer Behavior

Rajesh Verma
 MKT501 MARKETING MANAGEMENT

MKT509 Consumer Behaviour 2020 Dr. Rajesh Verma

 Lecture Learning Outcome
MKT501 MARKETING MANAGEMENT

After this session, you will be able to:

•Discuss innovation diffusion and apply the

innovation analysis to develop marketing
strategy.

MKT509 Consumer Behaviour 2020 Dr. Rajesh Verma

 Consumer Behaviour

MKT509 Consumer Behaviour 2020 Dr. Rajesh Verma

 Innovation

An innovation is an idea, practice, or product

perceived to be new by the relevant individual or
group.

MKT509 Consumer Behaviour 2020 Dr. Rajesh Verma

 Defining Innovations
 Firm-oriented definitions
 Product is “new” to the company
 Product-oriented definitions
 Continuous
 Dynamically continuous
 Discontinuous
 Market-oriented definitions
 Based on consumer exposure
 Consumer-oriented definitions
 Consumer judges it as “new”

MKT509 Consumer Behaviour 2020 Dr. Rajesh Verma

Innovation
- Continuous Innovation
Adoption of this type of innovation requires relatively minor changes in behavior
or changes in behaviors that are unimportant to the consumer.

MKT509 Consumer Behaviour 2020 Dr. Rajesh Verma

Innovation
- Dynamically Continuous Innovation
Adoption of this type of innovation requires a moderate change in an important
behavior or a major change in a behavior of low or moderate importance.

MKT509 Consumer Behaviour 2020 Dr. Rajesh Verma

Innovation
- Discontinuous Innovation
Adoption of this type of innovation requires major changes in behavior of
significant importance to the individual or group

MKT509 Consumer Behaviour 2020 Dr. Rajesh Verma

 Categories of Innovations

MKT509 Consumer Behaviour 2020 Dr. Rajesh Verma

 Example-Telephone

MKT509 Consumer Behaviour 2020 Dr. Rajesh Verma

 Quiz-Identify the Category

Dynamically Continuous Innovation

MKT509 Consumer Behaviour 2020 Dr. Rajesh Verma

Quiz-Identify the category

Discontinuous Innovation

MKT509 Consumer Behaviour 2020 Dr. Rajesh Verma

Quiz-Identify the category

Discontinuous Innovation

MKT509 Consumer Behaviour 2020 Dr. Rajesh Verma

 Adoption

The stages through

which an individual
consumer passes in
arriving at a decision to
try (or not to try), to
continue using (or
discontinue using) a new
product.

MKT509 Consumer Behaviour 2020 Dr. Rajesh Verma

 Process
NAME OF WHAT HAPPENS EXAMPLE
STAGE DURING THIS STAGE

Awareness Consumer is first exposed Rajesh sees an ad for a 23-inch thin LED
to the product innovation. HDTV in a magazine he is reading.

Interest Consumer is interested in Rajesh reads about the HDTV set on the
the product and searches manufacturer’s Web site and then goes to an
for additional information. electronics store near his apartment and has
a sales person show him the unit.
Evaluation Consumer decides After talking to a knowledgeable friend,
whether to believe that Rajesh decides that his TV will fit nicely on
this product or service top of the chest in his bedroom. He also
will satisfy the need--a calls his cable company and finds out that
kind of “mental trial.” he can exchange his “standard” cable box at
no cost for an HDTV cable box.

MKT509 Consumer Behaviour 2020 Dr. Rajesh Verma

 Process (-Contd-)
NAME OF WHAT HAPPENS EXAMPLE
STAGE DURING THIS STAGE

Trial Consumer uses the Since the HDTV set cannot be “tried” like a
product on a limited basis small tube of toothpaste, Rajesh buys the
TV at this local electronics store on his way
home from work. The store offers a 14-day
full refund policy.
Adoption If trial is favorable, Rajesh loves his new HDTV set and expects
(Rejection) consumer decides to use many year of service from it.
the product on a full,
rather than a limited
basis--if unfavorable, the
consumer decides to reject
it.

MKT509 Consumer Behaviour 2020 Dr. Rajesh Verma

Diffusion Process

The process by which the acceptance of an innovation is spread by

communication to members of social system over a period of time.

The diffusion process is the manner in which innovations spread

throughout a market.

MKT509 Consumer Behaviour 2020 Dr. Rajesh Verma

 Elements of the Diffusion
Process

 The Innovation
 The Channels of Communication
 The Social System
 Time

MKT509 Consumer Behaviour 2020 Dr. Rajesh Verma

 Rate of Diffusion

MKT509 Consumer Behaviour 2020 Dr. Rajesh Verma

 Quiz-Kind of diffusion?

 Fast
Diffusion

MKT509 Consumer Behaviour 2020 Dr. Rajesh Verma

 Example

https://yourstory.com/smbstory/hand-sanitisers-demand-coronavirus-personal-hygiene-manufacturers-pee-safe-vlcc

MKT509 Consumer Behaviour 2020 Dr. Rajesh Verma

 What is diffusion of
innovations? (Everett Rogers 1962)

MKT509 Consumer Behaviour 2020 Dr. Rajesh Verma

 Leader
Innovation distinguishes between a Leader and a
Follower.
-Steve Jobs

MKT509 Consumer Behaviour 2020 Dr. Rajesh Verma

 5 critical factors influencing
innovation diffusion

RANKING MUNDIAL DE USUÁRIOS DE INTERNET

Adoption probability grows if innovation has clear
Relative advantage advantages for product, service or current behavior
1º 2º 3º 4º 5º 6º
The more innovation is consistent with pre-existing
Compatibility higher the adoption probability

Complex changes involved in innovation, reduce

Complexity of transition adoption likelihood

A chance to try an innovation before making a final

Possibility of testing decision increase adoption likelihood
Towards Engaged Teaching
The more obvious innovation benefits the greater
Visibility of benefits adoption likelihood

MKT509 Consumer Behaviour 2020 Dr. Rajesh Verma

 Diffusion Rate
a) Nature of the group involved,
b) Type of innovation decision required,
c) Extent of marketing effort,
d) Strength of felt need,
e) Compatibility of the innovation with existing values,
f) Relative advantage,
g) Complexity of the innovation,
h) Ease in observing usage of the innovation,
i) Ease in trying the innovation, and
j) Perceived risk in trying the innovation.

MKT509 Consumer Behaviour 2020 Dr. Rajesh Verma

 Clicks analysis helps to
unravel diffusion
RANKING MUNDIAL DE USUÁRIOS DE INTERNET

Social networking 1º 2º 3º 4º 5º 6º
(word-of-mouth about Innovators
innovation)

E-mails Early Adopters

“Searcher” Late Majority

MKT509 Consumer Behaviour 2020 Dr. Rajesh Verma

 Threshold model

 Threshold model in consumer demand:

when one buys depends on the number
of previous buyers

Correlations

“Bandwagon” “Reverse Bandwagon”

(positive) (negative)

MKT509 Consumer Behaviour 2020 Dr. Rajesh Verma

 Bandwagon
To get into the “swim of things”

Status - seeking In order to conform with those they wish to be associated with

In order to be fashionable or stylish

MKT509 Consumer Behaviour 2020 Dr. Rajesh Verma

Towards Engaged
MKT509 Consumer Behaviour Teaching 2020 Dr. Rajesh Verma
Towards Engaged
MKT509 Consumer Behaviour Teaching 2020 Dr. Rajesh Verma
 Adopter Categories

Towards Engaged
MKT509 Consumer Behaviour Teaching 2020 Dr. Rajesh Verma
 Adoption Rate

MKT509 Consumer Behaviour 2020 Dr. Rajesh Verma

 Quiz: Which
Category of
adaptors is
this ad target
at?

Innovators
MKT509 Consumer Behaviour 2020 Dr. Rajesh Verma
 Quiz: Which Category of
adaptors this event target at?

MKT509 Consumer Behaviour 2020 Dr. Rajesh Verma

Marketing
Strategy

MKT509 Consumer Behaviour 2020 Dr. Rajesh Verma

 Discussion Question
 Which adaptor category are you?

 Does it differ with different product categories?

 How about your parents, what category are

they?

 Is age a factor in innovation behavior?

MKT509 Consumer Behaviour 2020 Dr. Rajesh Verma

 Have a question or comment?

Need additional support?

rajesh.verma@lpu.co.in
www.rajeshverma.in
https://www.facebook.com/vermarajesh
https://in.linkedin.com/in/profrajeshverma
+91-9872974457 (WhatsApp)

MKT509 Consumer Behaviour 2020 Dr. Rajesh Verma