Chapter 3

CUSTOMER ANALYSIS

WHY ARE CUSTOMERS IMPORTANT?

Customers are essential because this is where the life of an organization begins. Until customers place orders, nothing really happens. Once customers think enough about your goods or services to buy them. you are in business. Also, when customers stop placing orders your organization starts to die. Customers thus have a great deal to do with the success or failure of an enterprise. We believe that customers are the engine, the critical driving force that powers a market economy.

Seven (7) questions you must ask yourself about your customers, their motivations, and your relationship to your customers.
1.

2.
3. 4.

5.
6. 7.

Who are my customers? Where are my customers? When do customers buy? What do my customers want? How do customers buy? How do you learn about customers? How does a firm become customer oriented?

WHO ARE MY CUSTOMERS?

Consumer Customers
Consumer buyers include everyone who purchases goods for their own or family members consumption.

Business Customers
The demand for business products is derived from the demand for the final product. Thus the identity of components and services is often lost when selling to business buyers. As a result, the importance of brands is reduced and the role of specifications, timely delivery, and price is increased. Under these conditions, identifying the right customer is extremely difficult.

Nonprofit Customer
This includes community orchestras, the United Fund, public radio and TV stations, credit unions, hospitals, and schools. Each of these organizations is managed by a local board of directors. As a result, purchase orders for supplies and equipment often go to firms that maintain offices in the community.

Choosing the Right Customers

The best solution to the dilemma of customer emphasis is to take guidance from the strategic plan. A good strategic plan should identify who the company expects to work with not only now but in the future.

WHERE ARE MY CUSTOMERS?

Knowing where customers are located can be very useful to marketing managers. Existing customers are sometimes traced through invoice data. Another way to locate customers is through the use of warranty cards. These cards are enclosed with merchandise and customers are asked to fill them out and return them to the manufacturer.

WHEN DO CUSTOMERS BUY?

These are the periods when customers want to order, then the marketing concept suggests the marketing manager should adapt production and distributions systems to meet these customer demands

Adapting to Customer Buying Patterns Changing Customer Buying Patterns

WHAT DO MY CUSTOMERS WANT?

Determining customer wants seems simple enough , just monitor current sales to see what they are buying. There is, of course, more to determining customer wants than just checking out what sells. The main reason is that many new concepts and products have yet to be invented and are not currently for sale.

HOW DO CUSTOMERS BUY?

Customer Buying Process

1. Recognition of problem or need
* Motivation * Reference Groups * Family Influences

2.

Search for Alternatives & Information

* Perception *Perceived Risk * Opinion Leaders

3. Buyers mental evaluation of alternatives * Learning * Consistency Paradigm * Fear

4. Attitude Formation and Change

* The Standard Learning Hierarchy * The Dissonance-Attribution Hierarchy * The Low-Involvement Hierarchy

5. Purchase

6.

Postpurchase Behavior
* Dissatisfaction - Product or services
that do not live up to the buyer's expectation for durability or performance result in consumer dissatisfaction.

* Cognitive Dissonance - Another

important area of postpurchase behavior is cognitive dissonance , for the consumer remains aware of the favorable features of the unchosen brands and must reconcile this knowledge with his or her own decisions.

HOW DOES A FIRM BECOME CUSTOMER ORIETED?

Many firms say they are customer oriented, but often this is just slogans and window dressing. Some manager profess to be interested in customers just to protect their own departments and chances for promotion. Customer Checklist
They prepared a checklist to monitor how well they were doing in their drive to be more customer oriented.

Plant tours and Customer Visits

Another good way to learn about customers is to invite them in for a tour of your facilities and some informal discussions.