Marketing Exam 2 Study Guide Chapter 6 Consumer Decision Making Understanding consumer behavior reduces uncertainty when defining target market and marketing mix Consumer decision making process 1 need recognition imbalance b t actual and desired states stimuli trigger wants 2 information search external outside environment internal using memory 3 evaluation of alternatives evoked set group of products that can be chosen 4 purchase consumer decides whether to buy when what where and how to pay 5 postpurchase behavior cognitive dissonance consumers try to seek pos reinforcement Types of Consumer buying decisions involvement 1 routine response behavior frequently purchased low cost little search time 2 limited decision making moderate info gathering deliberating b t few alternatives 3 extensive decision making unfamiliar expensive product lots of info seeking Factors that determine level of involvement previous experience interest perceived risk of negative consequences financial social psychological situation social visibility Cultural Influences on Consumer Behavior 1 Culture Values values are most defining element of a culture 2 Subculture homogeneous group of ppl share overall culture unique elements Can be divided based on demographics geographic national ethnic background political beliefs religious beliefs 3 Social class ppl equal in status or esteem socialize together share behavioral norms Social Influences on Consumer Behavior 1 Reference groups primary membership interact regularly ex family friends secondary membership less consistent interaction more formal ex club aspirational group someone wants to join nonaspirational group with which and individual does not want to associate 2 Opinion leader individual who influences opinions of others 3 Family socialization process how cultural values norms are passed down Individual Influences on Consumer Behavior 1 Gender more men beginning to shop 2 Age Family Life Cycle major life events married kids etc 3 Personality Self concept self perception made up of ideal and real self image Psychological Influences on Consumer Behavior 1 Perception interpreting stimuli selective exposure distortion and retention 2 Motivation Maslow s hierarchy physiological safety social self esteem actualization 3 Learning experiential conceptual stimulus generalization discrimination 4 Beliefs Attitudes changing beliefs importance of beliefs or adding new ones Chapter 7 Business Marketing Intended use not physical characteristics distinguishes business product from consumer Stickiness how effective a Web site is frequency x duration x site reach B2B internet trends disintermediation reintermediation building relationships Strategic Alliances must be built on commitment trust to succeed in long run Keiretsu network of interlocking corporate affiliates 4 Major categories of Business Customers 1 Producers original equipment manufacturers buy business goods incorporate them into products they produce ex construction real estate food service firms 2 Resellers buy finished goods resell them for profit 3 Governments contracts usually put out for bid 4 Institutions goals other than profits ex schools hospitals colleges churches NAICS numbering system used to classify businesses by industry How business markets differ from consumer markets Demand derived demand for business products inelastic increase in price doesn t affect demand joint demand for 2 or more items used together in final product fluctuating multiplier effect small increase in consumer demand creates large change in business demand of customers far fewer than consumer marketers Location of buyers much more geographically concentrated ex New York Distribution structure more direct channels B2B online exchange Nature of buying more formal than consumer buying Nature of buying influence more people involved in purchase decisions Type of negotiations much more common in business markets Use of reciprocity business buy from own customers Use of leasing business lease much more than consumers Primary Promotional Method personal selling personal contact Types of Business Products 1 Major equipment capital goods ex planes buildings 2 Accessory equipment less expensive shorter lived ex drills fax machines 3 Raw materials unprocessed ex ore lumber wheat fruits 4 Component parts finished or almost finished ex tires electric motors 5 Processed materials some processing ex chemicals corn syrup plastic 6 Supplies consumable not part of final product ex paper towels paper pencils 7 Business services expense items ex advertising legal maintenance Business Buying Behavior Buying centers all people in an org who become involved in purchase decision Evaluate criteria quality service price Buying Situations new buy purchasing for first time modified rebuy some change in original good or service straight rebuy reorders same goods Business Ethics most companies follow ethical practices Customer Service increasing importance some customers are more valuable Chapter 5 Developing a Global Vision Benefits expands economic freedom spurs competition raises productivity living standards MNC heavily involved in international trade capital intensive using more capital than labor in production process Countries such as China Canada are restricting foreign purchases by MNC s Global marketing standardization uniform products all over the world External Environment Factors Culture companies must understand culture to be successful ex language problems Economic Technological Development more developed more purchasing power China India both have huge markets China U S have strained relationship Political Structures Actions Tariffs quotas boycotts exchange control market grouping ex EU Mercosur Latin American Trade Agreement Uruguay Round dramatically lower trade barriers worldwide created WTO WTO eliminated GATT fixed loopholes NAFTA Canada US Mexico free trade zone CAFTA Central America instituted in 2005 EU free trade zone w 27 European countries also political economic community World Bank offers low interest loans advice and info to developing nations IMF lender of last resort promotes trade loans to troubled nations G 20 forum for international economic development discuss key global issues Demographic Makeup urban or rural age geographic distribution Natural Resources shortages of oil etc How firms enter global market in order of low risk low return to high risk high return Exporting least risky buyer for export
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