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Lecture

Lecture #6 - Jan 25.docx

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Department
Economics
Course
Economics 1022A/B
Professor
Jeannie A Gillmore
Semester
Winter

Description
th MOS Lecture Notes January 25  Back to last classes risk question ($100 coin flip or $50) o If you are indifferent to this then you are risk neutral o If this amount is greater than $50 then you are risk seeking Socio-Cultural Influences  (51-59)  One way to summarize this material is to think about how our relation to different groups affects our decision-making as consumers o Why do consumers read certain blogs for advice? o Why do people buy expensive sport jerseys? o Why did Molson launch a strong beer in Quebec? Takeaways  Think of purchase decisions as the result of a process rather than an act  Customer evaluations are based on attributes; marketers try to know which of these matter to consumers  Involvement, situational factors affect intensity of the decision-making process  Consider: psychological and social cultural factors as well 5 Stage Model 1. Problem recognition  Level of involvement in purchase decision: personal, social, economic consequences 2. Information search  Situation  Psychological influences  Level of involvement in purchase decision: personal, social, economic consequences 3. Evaluation of alternatives  Situation  Psychological influences  Level of involvement in purchase decision: personal, social, economic consequences 4. Purchase decision  What where and when to buy  Socio-cultural influences  Level of involvement in purchase decision: personal, social, economic consequences 5. Post purchase behaviour  Am I satisfied?  Revisit decision and perhaps make a different decision  Level of involvement in purchase decision: personal, social, economic consequences *Other things that affect these decisions* Chapter 6: Segmentation and Targeting  How are market segments identified from the data? o Looking at the data to find the best way to describe the market o Statistical approaches o Harley Davidson: “Female buyers now account for 13% of new Harley-Davidson purchases”  May seem like a small number, but now if they are only targeting men then they are missing out on that 13% of the market  Where is the product image located? o Issue of objective and subjective properties of the product o “…in consumers’ minds relative to the competition” (110)  Why is repositioning relatively rare? o McDonald’s example  In France, the McDonalds is like all fancy and different then here (serve beer and wine, people on cash come ask what you want, etc.) o Gives up brand image that has been carefully cultivated over time o Risky!  The image of McDonalds that have been carefully placed and put into people minds is now changing, so all of the value that is stored in that marketing position is just given away for a new identity Market Segmentation  Consumers have diverse needs o One size does not fit all  Companies need to concentrate their resources (e.g. money) o Markets are
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