RSM353H Consumer Behaviour Midterm Notes.docx

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University of Toronto St. George
Rotman Commerce
Scott Hawkins

Introduction to Consumer Behavior 9/24/2012 7:59:00 PM Market segmentation strategies: targeting a brand only to a specific group of consumers Brands have defined images or personalities created by product advertising, packaging, branding and other marketing strategies that focus on positioning a product a certain way If product succeeds getting a trust, it builds brand loyalty WHAT IS CONSUMER BEHAVIOUR? CB: study of the processes involved when individuals or groups select, purchase, use or dispose of products, services, ideas or experiences to satisfy needs and desires Consumer behavior is a process o On-going process, not a momentary thing o Exchange is integral part of marketing Before, after or during the purchase Consumer behavior involves many different actors o Consumer: person who identifies a need or desire, makes a purchase, then dispose of the product during the three stages in the consumption process Can be individuals or organizations/groups o Purchaser/user o Influencer CONSUMERS IMPACT ON MARKETING STRATEGY Firms satisfy consumers needs and marketers must understand the people/organizations to do better Knowledge about consumers is important Since marketing is not forever, this knowledge helps to ensure the product is appealing in the present and the future Segmenting Consumers o Marketing segmentation: identifies groups of consumers who are similar to one another in one or more ways and then devises marketing strategies that appeal to one or more groups o Demographics: measure observable aspects of a population such as birth rate, age distribution and income Relationship marketing: building bonds with consumers o Database marketing: involves tracking consumers buying habits very closely and crafting products and messages based on information MARKETINGS IMPACT ON CONSUMERS Marketing and culture o Popular culture can be a product and inspiration for marketers o Consumer-generated content: everyday people voice their opinions on blogs, Internet and this is the biggest marketing phenomenon o Web2.0: era of rebirth of the Internet as interactive medium The meaning of consumption o People often buy products not for what they do but for what they mean o Choose the brand that has an image consistent with his or her underlying needs o Role theory: consumer act out many different roles and alter their consumption depending on their role at the moment o Emphasis on building relationships with customers The global consumer o U-commerce: use of ubiquitous networks that will slowly but surely become a part of us o Globalization gives a reason to understand how customers are in other countries differ from host o Virtual consumption B2C commerce C2C commerce Marketing Ethics and Public Policy o Business ethics: rules of conduct that guide actions in the market place NEEDS AND WANTS: DO MARKETERS MANIPULATE CONSUMERS Consumer jamming: aims to disrupt efforts by the corporate world to dominate our cultural landscape Green marketing: firms protect or enhance the natural environment as they go about their business activities Social marketing: using marketing techniques normally employed to sell beer or detergent to encourage positive behaviors such as increase literacy or to discourage negative activities THE DARK SIDE OF CONSUMER BEHAVIOUR Addictive consumption o Physiological or psychological dependency on products or services Compulsive consumption o Repetitive shopping, often excessive done as an antidote to tension, anxiety, depression or boredom o Compulsive centres on the process of buying, not the purchases themselves, impulsive buying focuses on the purchases of products Illegal activities o Shrinkage: industry term for inventory and cash losses from shoplifting and employee theft o Anti-consumption: products and services are deliberately defaced or mutilated CONSUMER BEHAVIOUR AS A FIELD OF STUDY Interdisciplinary influences on the study of consumer behavior o CB is influenced by different perspectives The issue of two perspectives on consumer research o Paradigm: fundamental assumptions the researchers make about what they are studying and how to study it o Positivism: basic set of assumptions underlying the dominant paradigm at this point in time Emphasizes the objectivity of science and the consumer as a rational decision maker o Interpretivism: importance of symbolic, subjective experiences and the idea that meaning is in the mind of the person- individuals construct their own meanings based on their unique and shared cultural experiences Stresses the subjective meaning of the consumers individual experience and the idea that any behavior is subject to multiple interpretations rather than having a single explanation Group Influence and Opinion Leadership 9/24/2012 7:59:00 PM Reference group: actual or imaginary individual or group conceived of as having significant relevance upon an individuals evaluations, aspirations or behaviour Informational influence: individual seeks information about brands from professionals Utilitarian influence: individuals decision to purchase a particular brand is influenced by the preferences of people of social interaction Value-expressive influence: will enhance the image others have of him or her Some people are more influential than others, marketers can use this as aid Normative influence: reference group helps to set and enforce fundamental standards of conduct Comparative influence: decisions about brands are affected Formal vs informal groups o Formal groups are easily identifiable and accessible (comparative) o Informal groups exert more power (normative) Brand communities and tribes o Brand community: set of consumers who share social relationships based on usage or interest in a product o Brandfest ->brand loyalty o Consumer tribe: people who share similar lifestyle, can identify each other of a shared allegiance to an activity or a product o Tribal marketing: link ones product to the needs of a group as whole Membership VS inspirational reference groups o Aspirational reference groups: idealized figures o Factors that affect the likelihood that people becoming part of consumers identified reference group Propinquity: physical distance Mere exposure: see often -> like Group cohesiveness Positive VS negative reference groups o Avoidance groups
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