MARK 3321 1st Edition Lecture 6 Outline of Last Lecture I Consumer Behavior II Consumer Decision Making Process III Factors determining Level of Consumer Involvement IV Marketing Implications of Consumer Involvement Outline of Current Lecture I Factors Influencing Buying Decisions II Market segmentation III Bases for Segmenting Consumer Markets Current Lecture Factors influencing Buying Decisions o Cultural o Subculture A homogenous group of people who share elements of the overall culture as well as unique elements of their own group Commonly divided on the basis of geographic regions national and ethnic background and religious beliefs Social class A group of people in society who are considered nearly equal in status or community esteem who regularly socialize among themselves both formally and informally and who share behavioral norms Measured as a combination of occupation income education wealth and other variables Social factors Reference groups Direct o Primary o Secondary These notes represent a detailed interpretation of the professor s lecture GradeBuddy is best used as a supplement to your own notes not as a substitute o o Indirect o Aspirational o Non aspirational Opinion leaders Family members Individual factors Gender Age life cycle stage Personality self concept lifestyle Psychological factors Perception Selective exposure o Selective distortion o Consumer remembers only that info that supports personal beliefs Motivation Consumer changes or distorts info that conflicts with feelings or beliefs Selective retention o Consumer notices certain stimuli and ignores others Maslow s Hierarchy of Needs Learning Learning theory o o Experiential vs conceptual learning Experiential works well with food such as sampling or free trial Conceptual are mainly explaining Stimulus generalization vs discrimination Stimulus generalization Stimulus discrimination Associating characteristics of the same brand for new products Being able to see the difference from other brands Beliefs and attitudes Changing target consumers attitudes o Changing beliefs about attributes o Changing the importance of beliefs o Adding new beliefs CH 8 Segmenting and Targeting Markets Market segmentation o Market o Market segment o A subgroup of people or organizations sharing one or more characteristics that cause them to have similar product needs Market segmentation People or organizations with needs or wants and the ability and willingness to buy The process of dividing a market into meaningful relatively similar identifiable segments or groups Criteria for successful segmentation o Substantiality o Identifiability and measurability o Segments must be identifiable and their size measurable Accessibility o Segment must be large enough to warrant a special marketing mix Members of targeted segments must be reachable with marketing mix Responsiveness Segmentation bases variables o Unless segment responds to a marketing mix differently no separate treatment is needed Characteristics of individuals groups or organizations used to divide a total market into segments Bases for Segmenting Consumer Markets o o o Geographic segmentation base Region of the country or world Market size Market density Climate All of these are variables Demographic segmentation base Age Gender Income Ethnic Family life cycle Psychographic segmentation Personality Motives broad and general Self expression Conveying status Stay consistent with their religious or moral beliefs Lifestyles Geo demographics o Combination of geographic demographic and lifestyle variables Benefit segmentation The process of grouping customers into market segments according to the benefits they seek from the product Product specific Ex common benefits sought by people who ride bicycles o o Exercise off road adventure transportation socialization environmental Usage rate segmentation Dividing a market by the amount of product bought or consumed 80 20 principle A principle holding that 20 of all customers generate 80 of the demand More useful for services than products Ex restaurants can look at number of visits sales etc