BUS 450

CHAPTER
ONE
Consumer
Behavior:
Meeting
Changes and
Challenges

Learning Objectives
1. To Understand What Consumer Behavior Is and
the Different Types of Consumers.
2. To Understand the Relationship Between
Consumer Behavior and the Marketing Concept,
the Societal Marketing Concept, as Well as
Segmentation, Targeting, and Positioning.
3. To Understand the Relationship Between
Consumer Behavior and Customer Value,
Satisfaction, Trust, and Retention.
4. To Understand How New Technologies Are
Enabling Marketers to Better Satisfy the Needs
and Wants of Consumers.
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Chapter One Slide

2

Learning Objectives
(continued)
5. To Understand How Marketers Are
Increasingly Able to Reach Consumers
Wherever Consumers Wish to Be Reached.
6. To Understand How the Worlds Economic
Condition Is Leading to Consumption
Instability and Change.
7. To Understand the Makeup and Composition
of a Model of Consumer Behavior.
8. To Understand the Structure of This Book

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3

To Which Segment of
Consumers Will This Ad
Appeal?

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Chapter One Slide

A Segment of Consumers
Who are Environmentally
Concerned

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Chapter One Slide

Consumer Behavior
The behavior that consumers display
in searching for, purchasing, using,
evaluating, and disposing of products
and services that they expect will
satisfy their needs.

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6

Two Consumer Entities

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7

Development of the
Marketing Concept

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8

Production Orientation
From the 1850s to the late 1920s
Companies focus on production
capabilities
Consumer demand exceeded supply

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9

Sales Orientation
From the 1930s to the mid 1950s
Focus on selling
Supply exceeded customer demand

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10

Marketing Concept
1950s to current - Focus on the
customer!
Determine the needs and wants of
specific target markets
Deliver satisfaction better than
competition

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Chapter One Slide

11

Discussion Questions
1. What two companies
do you believe grasp
and use the marketing
concept?
2. Why do you believe
this?

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12

Societal Marketing Concept

Considers
consumers longrun best interest
Good corporate
citizenship

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13

The Marketing Concept

Embracing the
Marketing
Concept
Consumer
Research
Segmentation
Market
Targeting
Positioning

The process and

tools used to study
consumer behavior

Copyright 2010 Pearson Education, Inc. publishing as Prentice Hall

Chapter One Slide

14

The Marketing Concept

Implementing the
Marketing
Concept
Consumer
Process of dividing
Research
Segmentation
Market
Targeting
Positioning

the market into

subsets of
consumers with
common needs or
characteristics

Copyright 2010 Pearson Education, Inc. publishing as Prentice Hall

Chapter One Slide

15

Discussion Questions
1. What products that you regularly
purchase are highly segmented?
2. What are the different segments?
3. Why is segmentation useful to the
marketer for these products?

Copyright 2010 Pearson Education, Inc. publishing as Prentice Hall

Chapter One Slide

16

The Marketing Concept

Implementing the
Marketing
Concept
Consumer
The selection of one
Research
Segmentation
Market
Targeting
Positioning

or more of the
segments identified
to pursue

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Chapter One Slide

17

The Marketing Concept

Implementing the
Marketing
Concept
Developing a distinct
Consumer

image for the product in

the mind of the consumer
Successful positioning
includes:
Communicating the
benefits of the product
Communicating a
unique selling
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Hall
Chapter One Slide
18

Research
Segmentation
Market
Targeting
Positioning

The Marketing Mix

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Chapter One Slide

19

Customer Value,
Satisfaction, Trust, and
Retention

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Chapter One Slide

20

Successful Relationships
Value,
Satisfaction,
Trust,
and
Customer
Retention
Value
Customer
Satisfaction
Customer
Trust
Customer
Retention

Defined as the ratio

between the
customers perceived
benefits and the
resources used to
obtain those benefits
Perceived value is
relative and subjective
Developing a value
proposition is critical

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Chapter One Slide

21

Discussion Questions
How does
McDonalds
create value for
the consumer?
How do they
communicate this
value?

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Chapter One Slide

22

Successful Relationships
Value,
Satisfaction,
Trust,
and
Customer
Retention
Value
Customer
Satisfaction
Customer
Trust
Customer
Retention

The individual's perception

of the performance of the
product or service in
relation to his or her
expectations.
Customer groups based on
loyalty include loyalists,
apostles, defectors,
terrorists, hostages, and
mercenaries

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Chapter One Slide

23

Successful Relationships
Value,
Satisfaction,
Trust,
and
Customer
Retention
Value
Customer
Satisfaction
Customer
Trust
Customer
Retention

Establishing and
maintaining trust
is essential.
Trust is the
foundation for
maintaining a
long-standing
relationship with
customers.

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Chapter One Slide

24

Successful Relationships
Value,
Satisfaction,
Trust,
and
Customer
Retention
Value
Customer
Satisfaction
Customer
Trust
Customer
Retention

The objective of providing

value is to retain highly
satisfied customers.
Loyal customers are key
They buy more products
They are less price
sensitive
Servicing them is
cheaper
They spread positive
word of mouth

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Chapter One Slide

25

Top 10 Ranked U.S. Companies in Terms

of Consumers Trust and Respect of
Privacy
Table 1.2
Top 10
Companies

American
Express
eBay
IBM
Amazon
Johnson &
Johnson
Hewlett-Packard
U.S. Postal
Service
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Chapter One Slide 26

THE TRADITIONAL MARKETING

CONCEPT

VALUE- AND RETENTIONFOCUSED MARKETING

Make only what you can sell instead

of trying to sell what you make.

Use technology that enables

customers to customize what you
make.

Do not focus on the product; focus on

the need that it satisfies.

Focus on the products perceived

value, as well as the need that it
satisfies.

Market products and services that

match customers needs better than
competitors offerings.

Utilize an understanding of customer

needs to develop offerings that
customers perceive as more valuable
than competitors offerings.

Research consumer needs and

characteristics.

Research the levels of profit

associated with various consumer
needs and characteristics.

Understand the purchase behavior

process and the influences on
consumer behavior.

Understand consumer behavior in

relation to the companys product.

Realize that each customer

transaction is a discrete sale.

Make each customer transaction part

of an ongoing relationship with the
customer.

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27
Chapter One Slide

Impact of Digital
Technologies

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Chapter One Slide

28

The Mobile Consumer

Wireless Media
Messages will
expand as:

Penetration of Internet Usage Among

Mobile Subscribers in 16 Countries FIGURE 1.3

Flat-rate data
traffic increases
Screen image
quality is
enhanced
Consumer-user
experiences with
web applications
improve
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29

Consumer Behavior Is
Interdisciplinary

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30

A Simple Model of Consumer Decision

Making - Figure 1.4

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31