explain why marketing managers should understand consumer behavior
if a manager knows through research that something is the most important attribute to a target market, the manufacturer will redesign the product to include that attribute
components of the consumer decision making process
1. need recognition – the result of an imbalance in desired states
2. information search – customers search for available alternatives to satisfy.
3. evaluation of alternatives – the customer uses information stored in memory and obtained from outside sources to develop criteria to make the decision
4. purchase – fully planned purchase – based upon a lot of information.
partially planned purchase – know product category they want but don’t know the specific store or product.
unplanned purchase – the customer doesn’t know what to buy until they get there.
5. postpurchase behavior – when buying products, consumers expect certain outcomes from the purchase
explain the consumer’s post purchase evaluation process
when people recognize inconsistency between their values and their behavior they feel an inner tension called cognitive dissonance. Consumer’s try to reduce dissonance by justifying their purchase decision. Marketing managers can help reduce dissonance through effective communication with the customer.
Identify the types of consumer buying decisions and discuss the significance of consumer involvement
routine response behavior – frequently purchased, low cost, low involvement.
limited decision making – low levels of involvement (higher than routine)
extensive decision making – high levels of involvement
Identify and understand the cultural factors that affect consumer buying decisions
pervasive – all the things customers do without conscious choice
functional – creates values and acceptable behavior for each culture.
learned – Consumers are not born knowing the values and norms of society.
dynamic – it adapts to changing needs and an evolving environment.
value – an enduring belief share by a society that a specific mode of conduct is personally or socially preferable to another mode of conduct.
Identify and understand the social factors that affect consumer buying decisions
Identify and understand the individual factors that affect consumer buying decisions
gender – physical differences between man and woman.
age and family life cycle stage -age can play a role, as well as the stages through which the user evolves through maturity
Describe business marketing
the marketing of goods and services to individuals and organizations for purposes other than personal consumption
Describe the role of the Internet in business marketing
the use of the internet to facilitate the exchange of goods, services the exchange of goods and services and information between organizations.
Discuss the role of relationship marketing and strategic alliances in business marketing
business’ use relationship marketing and strategic alliances to strengthen operations and better compete.
Identify the four major categories of business market customers
producers, resellers, governments, and institutions
Explain the North American Industry Classification System
a detailed numbering system developed by the United States, Canada, and Mexico to classify North American business establishments by their main production processes
Explain the major differences between business and consumer markets
Unlike consumer demand, business demand is derived, joint, and fluctuating.
Business customers buy in much larger quantities than consumers.
Business marketers usually have far fewer customers than consumer marketers.
Business customers tend to be much more geographically concentrated than consumers.
Channels of distribution for business marketing are typically shorter.
Unlike consumers, business buyers usually approach purchasing rather formally.
Typically more people are involved in a business decision.
Negotiation is much more common in the business market.
Business’ usually choose to buy from their own customers.
Business’ lease much more commonly than consumers.
Business marketers tend to emphasize personal selling in their promotion efforts.
Describe the seven types of business goods and services
Discuss the unique aspects of business buying behavior
Describe the characteristics of markets and market segments
market – people or organizations with needs or wants and the ability and willingness to buy
market segment – a subgroup of people or organizations sharing one or more characteristics that cause them to have similar product needs
Explain the importance of market segmentation
Market segmentation helps marketers define customer needs and wants more precisely.
Discuss criteria for successful market segmentation
sustainability – a segment must be large enough to warrant developing and maintaining a special marketing mix.
identifiability and measurability – segments must be identifiable and their size measurable.
accessibility – the firm must be able to reach members of targeted segments with customized marketing mixes
responsiveness – the firm need not treat a segment that doesn’t respond as well separately
Describe the bases commonly used to segment consumer markets
geographic segmentation – refers to segmenting markets by region.
demographic segmentation – segmenting markets on demographics (age, gender)
psychographic segmentation – market segmentation by personality, motives, lifestyles etc.
usage rate segmentation – divides a market by the amount of product bought or consumed.
List the steps involved in segmenting markets
1. select a market or product category for study
2. choose a basis or bases for segmenting the market
3. select segmentation descriptions
4. profile and analyze segments
5. select target markets
6. design, implement, and maintain appropriate marketing mixes
Describe the bases for segmenting business markets
company characteristics – geographic location, type of company, company size.
buying processes – segmenting customers on the basis of how they buy.
Discuss alternative strategies for selecting target markets
undifferentiated targeting – essentially adopts a mass-market philosophy viewing the market as one big market with no individual segments.
concentrated targeting strategy – a firm selects a market niche for targeting its marketing efforts.
multisegment targeting strategy – a firm that chooses to serve two or more well-defined market segments and develops a distinct marketing mix for each.
Explain how CRM can be used as a targeting tool
CRM entails tracking interactions with customers to optimize customer satisfaction and long-term company profits.
Explain how and why firms implement positioning strategies and how product differentiation plays a role
The development of any marketing mix depends on positioning, influences the overall perception of a brand. product differentiation is a positioning strategy that many firms use to distinguish their products from those of competitors.
Explain the concept and purpose of a marketing decision support system
an interactive, flexible, computerized information system that enables managers to obtain and manipulate information as they are making decisions.
Define marketing research and explain its importance to marketing decision making
the process of planning, collecting, and analyzing data relevant to a marketing decision. Marketing research links the consumer, customer, and public to the marketer through information.
Describe the steps involved in conducting a marketing research project
1. identify and formulate the problem/opportunity
2. plan the research design and gather secondary data
3. specify the sampling procedures.
4. Collect primary data
5. analyze the data
6. prepare and present the report
7. follow up
Discuss the profound impact of the Internet on marketing research
the rapid development of the internet has eliminated much of the drudgery associated with the collection of secondary data
Discuss the growing importance of scanner-based research
a huge database of marketing efforts and consumer behavior is compiled through scanner based research
Explain when marketing research should be conducted
Research should be undertaken only when the expected value of the information is greater than the cost of the information
Explain the concept of competitive intelligence
an intelligence system that helps managers assess their competition and vendors in order to become more efficient and effective competitors.
Define the term product
everything, both favorable and unfavorable, that a person receives in an exchange.
Classify consumer products
bought to satisfy an individual’s personal wants
Describe marketing uses of branding
branding has three main purposes: product identification, repeat sales, and new product sales.
Describe marketing uses of packaging and labeling
packaging functions – containing and protecting the products, promoting products, facilitating storage, use, and convenience, facilitating recycling and reducing environmental damage.
Discuss global issues in branding and packaging
one brand name everywhere – useful when company markets one main product and does not have any connotations in markets
adaptations and modifications – modifications such as name, when the product has the wrong connotation elsewhere
different brand names in different markets – changing your brand name to the language of the country your selling in.
Describe how and why product warranties are important marketing tools
a warranty confirms the quality or performance of a good or service.
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