Consumer Behaviour

Role of Marketing in Consumer Behaviour

Marketing Role
The role of marketing helps solve a number of contemporary problems in consumer behaviour Effective business managers realize the importance of marketing to the success of their firm.

Definition- Marketing
Marketing can be defined as . the process of planning & executing the conception, pricing, promotion, & distribution of ideas, goods & services, to create exchanges that satisfy individual & organizational objectives Notice that the definition includes services, Ideas & products as well

Marketing
It is important to understand the marketing concept, an important philosophy of many marketing managers The essence of the marketing concept is captured in three inter-related orientations:

Marketing Orientations
Consumers needs & wants Company objectives Integrated strategy

Marketing - Wants & Needs:

Consumers Wants & Needs: When the focus is on identifying & satisfying the wants & needs of customers, the intention of the firm is not merely seen as providing goods & services.

Marketing
Instead, wants & needs satisfaction is viewed as the purpose and providing the products & services is the means to an end

Company satisfaction:
Company satisfaction: Consumers needs & wants are many Therefore, a firm that concentrates on satisfying a small portion of all desires will most effectively utilize its resources

Integrated Strategy
An integrated effort is most effective in achieving a firms objective through consumer strategy For maximum impact this requires the marketing efforts be closely coordinated & compatible with each other & other activities of the organization

Limitations of marketing concept

Several limitations of the marketing concept have been noted, especially with the degree to which attempting to satisfy consumers needs & wants can lead to negative consequences for society

 For example, solid waste disposal of society, the propellant used in sprays cause depletion of the ozone layer

Solid waste disposal

Solid waste disposal

Ozone layer

Hole in Ozone layer

 Adjustments in the marketing concept that incorporate societal objectives have been made to lessen such shortcomings For example, several food chains have reduced their volume of packaging & have undertaken information campaigns to raise consumer awareness on environment friendly products

environment friendly products

Eco-friendly

Eco-friendly products

 However, the basic need to understand consumers is still fundamental to these revises schemes Several major activities can be undertaken that is marketing-orientation These include:

 Companys objectives & any of the firms special advantages are used as criteria to select the special needs & wants to be addressed

 Market Opportunity Analysis Target segment Selection Marketing Mix Determination

Market Opportunity Analysis

This activity involves examining Trends & conditions in the marketplace to identify consumers needs & wants that are not being fully satisfied The analysis begins with a study of general market trends, such as consumer lifestyles & income levels which may suggest unmet wants & needs

 A variety of recent trends have resulted in many product offerings for consumer satisfaction For example: companies attuned to the fitness interests of people have been quick to offer new products such as fitness bikes, weight training books, & clothing

 In the health care field companies sensing unmet needs have offered coin-operated blood pressure testing machines at shopping centers, & other locations Also low-priced minor surgery centers without meals or overnight stay are now available

Target Market Selection

The process of reviewing market opportunities often results in identifying distinct groupings of consumers who have unique wants & needs This can result in a decision to approach each market segment with a unique offering Consider the soft drink market

Target Market Selection

The process of reviewing market opportunities result in in identifying distinct groupings of consumers who have unique needs & wants This can result in a decision to approach each market with a unique market offering

Target Market Selection

Consider the soft drink market:

Target Market Selection

Major segments are distinguished by the type of purchase situation: The Food Store segment The cold bottle or vending machine segment The fountain market , including fast-food outlets

Food Store segment

Vending machines

Fountain Market

Target Market Selection

Unique packaging arrangementscontainer type & size- point of purchase promotions, & other variants are made for each segment

Marketing Mix Determination

This stage involves developing & implementing a strategy for delivering an effective combination of want satisfying features to consumers within target segments A series of decisions are made on four major ingredients frequently referred to as the marketing mix variables- 4Ps

Marketing Mix Determination

These characteristics in each area provides some information on & knowledge in consumer behaviour relevant for decision making:

Marketing Mix Determination

Product: What size, shape, & features should the product have? How should it be packaged? What aspects of service are most important to consumers?

Coke, fanta, Sprite

Varied products

Fanta- Different Flavours

Coke
Coke- Zero calories- 100 countries

Sprite & Fanta

General Motors

GM

Timex & Swatch

Timex watches

Swatch
Swatch

Swatch

Swatch

Swatch
Telephone

Product positioning
Positioning can be done by: Product Attribute: Colgate fights cavities ; Close Up gives fresh breath Product User: Johnson baby soaps for babies/children Product Class: Kelloggs is a breakfast food

Johnson
Soap

Kelloggs
Cornflakes

Product positioning
Product application: Vicks Action 500 is for colds, Iodex for backaches/sprains Price/Quality: Arrow is an expensive shirt Competition: Kawasaki bike is better than Yamaha in acceleration, Cadburys & Munch advertisements Positioning is with reference to competition

Motor Cycles
Kawasaki & Yamaha

Yamaha

Yamaha

Kawasaki

Kawasaki
Mo-bike

Shirts- Price, quality

Arrow shirts

Arrow shirts

Chocolates
Chocolates

Nirma- Low cost

IBM-Distribution/Service

Caterpillar-Distribution/Service

Caterpillar-Distribution/Service

Mercedes-Prestige
Logo

Mercedes-Prestige
Logo

Mercedes-Prestige

Mercedes-Prestige

Mercedes-Prestige

Price
The SL-500 offers an overwhelming sporting experience. One of its kind as the New SL-Class Roadster is the first Mercedes to be equipped with SENSOTRONIC BRAKE CONTROL (SBC). At the showroom, this car costs around Rs 1 crore 20 lakhs with an on-road price of around Rs. 1 crore 33 lakhs.

Mercedes-Prestige
Car

Rolls Royce-Prestige
Rolls-Royce Motor Cars made its debut at the 1904 Paris Motor Show, displaying two-, threeand four-cylinder cars, delivering 10hp, 15hp and 20hp respectively. An advert was placed in The Autocar magazine for "the first simple, silent Rolls-Royce", and with the launch of the sixcylinder, 30hp model (6177cc, 55mph) success was immediate. Rolls began to race a "Twenty" four-cylinder car - with its 4118cc 20hp engine delivering up to 52mph - and won the 1906 Isle of Man Tourist Trophy in a "Light Twenty" shorter-wheelbase model.

Rolls Royce Price in India

Rs. 3,50,00,000 Rs. 4,20,00,000

Rolls Royce-Prestige
Logo & Symbol: Sykes called it The Spirit of Speed, but later he said, "A graceful little goddess, the Spirit of Ecstasy, who has selected road travel as her supreme delight and alighted on the prow of a Rolls-Royce motor car to revel in the freshness of the air and the musical sound of her fluttering draperies." The Spirit of Ecstasy was born. Sykes presented the first Silver Lady to Rolls-Royce in February 1911, since then nearly every Rolls-Royce car has featured this figurine.

Interiors

Rolls Royce-Prestige
Rolls Royce

Product
What type of Warranties & service programmes should be provided? What type of accessories & associated products should be offered?

Product
Example of water in US & India The market for Mineral water & watertreatment systems has opened up

Price
Marketers have to decide on the prices to be charged for the companys products & services This will determine the amount of revenue the company will generate Factors involving CB are:

Price
How aware are the consumers in the relevant product segment? How sensitive are consumers to price differences among brands? How large a price reduction is needed to encourage purchasers during new product introductions & sales promotion?

Price
What size discounts should be given to those who buy by cash? For example in the watch market the consumers do not show a high concern for prices A special-made custom watch has been sold for $4.3 million A New York dealer sold 50,000 gold Swiss watches in one year

Watches

Cartier
-Prices start at around $500 and go as high as $100,000.00 depending on model, gold content and vintage.

Place
The place variable involves consideration of where and how to offer products & services for sale It is also involved with mechanisms for transferring goods & their ownership to consumers Decisions influenced by CB include:

Place
What type of retail outlet should sell the firms offering? Where should they be located? How many? What arrangements are reqd to distribute products from to retailers?

Place
To what extent is it necessary for the company to own or maintain tight control over activities of firms in the channel of distribution? What image & clientele should the retailer seek to cultivate? Example: Sears & Sears Financial Network

Promotion
The goals & methods of communicating are of concern for CB Consumer related decisions include: What methods of promotion are best for each specific situation? What are the most effective means to get consumer attention?

Promotion
What methods best convey the intended message? How often should a given advertisement be repeated? Role of comparative advertising

Comparative advertising
Comparative advertising is an advertisement in which a particular product, or service, specifically mentions a competitor by name for the express purpose of showing why the competitor is inferior to the product naming it.

Comparative advertising
Chocolates

Parody advertising
This should not be confused with parody advertisements, where a fictional product is being advertised for the purpose of poking fun at the particular advertisement, nor should it be confused with the use of a coined brand name for the purpose of comparing the product without actually naming an actual competitor.

Comparative advertising
The Campbell Soup Company is calling out Progresso chicken noodle soup for having MSG and Dunkin' Donuts is promoting a taste test claiming the respondents preferred their coffee over Starbucks.

Report
Surefire Loses Preliminary Injunction Motion Against Advanced Armaments Silencer Advertising

Report
Santa Ana, CA The court denied Surefires preliminary injunction motion and silenced its attempt to shoot down Advanced Armaments silencer advertising. (Motion details blogged here). The court quickly pointed out that the accused advertisement doesnt make any reference to Surefire and the pictured suppressor is not readily identifiable as a Surefire product. Surefire must be questioning its decision to file a lawsuit that unlike the advertisement at issue unequivocally identified its product as the one pictured in the advertisement and brought more attention to it than the advertisement itself. Indeed, Surefire submitted discussions from weapon forums that referenced the lawsuit and the advertisement at issue. The alleged four false statements at issue were: (1) the SureFire suppressor shown uses spot welds; (2) SureFires spot welds are not as strong as the fusion welds used by AAC; (3) SureFires spot welds are likely to fail during normal semi-automatic and full-automatic firings; and (4) AACs suppressors are more durable than suppressors like the SureFire suppressor shown. The court determined that the statements were not literally false on their face or by necessary implication because the suppressor cannot be positively identified as Surefires. As a result, the court also found that Surefire could not evidence actual injury because the non-comparative statements cause injury to all competitors and none is more likely to suffer from the offending broadcasts than any other. Thus, Surefire could not show a likelihood of success on the merits or significant hardship if the preliminary injunction was not granted. The case is SureFire, LLC v. Advanced Armament Corp., SACV 08-1405 DOC (C.D. Cal. 2008).

India- Ford & City

Unibic India
This is what Unibic India found soon after the launch of their biscuit Great Day. Accompanied with the tagline, Why have a good day, when you can have a great day!, this obvious stab in the direction of competitor Britannias Good Day biscuits, has led to the issuance of an injunction order by the Bangalore City Civil Court on December 12 in 2007. The order also now restrains Unibic from placing any further advertisements that disparage Good Day in any manner especially as in their copy where they urge consumers to try Great Day and not any other mere biscuit.

Unibic India
http://images.google.co.in/imgres?imgurl=http://b p3.blogger.com/_GtnL9sC_Uho/R7w_iGzJ5iI/AA AAAAAAAs8/TUFEbySsO1c/s320/2.jpg&imgrefu rl=http://selvamandselvam.blogspot.com/2008/0 2/comparative-advertising-britanniagets_9103.html&usg=__INrKXWaf0Ih9yDnJ_r1k ArEQL3s=&h=320&w=207&sz=9&hl=en&start=5 &um=1&tbnid=uQKXFhwKlXemaM:&tbnh=118&t bnw=76&prev=/images%3Fq%3Dcomparative% 2Badvertising%2Bindia%26ndsp%3D20%26hl% 3Den%26sa%3DN%26um%3D1

Horlicks vs Complan
GlaxoSmithKline Consumer Healthcare (GSK), which owns the Horlicks brand, recently took Heinz Indias health drink Complan head on. Its advertisement did not beat about the bush when it said it has more nutritional content and is also cheaper than Complan. Heinz India retaliated claiming that the higher price that consumers were paying for Complan was for a much higher nutritional value.

Horlicks vs Complan
http://images.google.co.in/imgres?imgurl=http:// www.businessworld.in/bw/image/Business/Mark etingAndAdvertising/Complan-and-HorlicksCut_TS.jpg&imgrefurl=http://www.businessworld .in/bw/2009_07_31_Name_Of_The_Game.html &usg=__zBzIdm8N6YX63kb6ICXDjT2UpK8=&h =164&w=150&sz=8&hl=en&start=31&um=1&tbni d=mkbqGQ15kXzzM:&tbnh=98&tbnw=90&prev=/images %3Fq%3Dcomparative%2Badvertising%2Bindia %26ndsp%3D20%26hl%3Den%26sa%3DN%26 start%3D20%26um%3D1

Coke-Pepsi
In the 1980s, during what has been referred to as the cola wars, soft-drink manufacturer Pepsi ran a series of advertisements where people, caught on hidden camera, in a blind taste test, chose Pepsi over rival Coca-Cola.

Coke- Pepsi
The use of comparative advertising has been well established in political campaigns, where typically one candidate will run ads where the record of the other candidate is displayed, for the purpose of disparaging the other candidate.

Pepsodent- Colgate
http://www.financialexpress.com/news/co mparative-advertising-in-india-need-tostrengthen-regulations/143918/

Pepsodent- Colgate
CASE 1: New Pepsodent vs Colgate Case Hindustan Lever Ltd claimed in advertising its New Pepsodent that this particular toothpaste was 102% better than the leading one. Its TV advertisement showed saliva samples of two boys taken for testing hours after brushing.

Pepsodent- Colgate
The ad suggested one boy had brushed with the New Pepsodent while the other one had used a leading toothpaste. Visually depicting the test of the two samples side by side, the slide with sample of the leading toothpaste showed a large number of germs while that with the New Pepsodent showed negligible germs.

Pepsodent- Colgate
In the ad, the boys were asked the name of the toothpaste they had used. While one boy said Pepsodent, the response of the second boy was muted. However, the lip movement of the boy indicated Colgate. Also, while muting, the music played in the background resembled that of the jingle used in the Colgate advertisement.

Pepsodent- Colgate
The market share of toothpaste for Colgate and Hindustan Lever was 59% and 27% respectively. The Commission was, thus, of the view that a reference to a leading and famous brand implied Colgate. But the Commission noted that due to the jingle played in the backgroud resembling to the one of Colgate and due to the brands presence in India for over 50 years, the comparitive product in the TV ad could be identified as Colgate. Thus, it became a case of comparative advertisement and a claim could be made of disparagement of Colgates products.

Ends