Final Exam Review 3809 Ch 8 11 EK 6 7 Chapter 8 Consumer Research The apparel supply chain has one purpose to provide an appealing and desirable product and to satisfy customer needs wants or aspirations Every forecast begins with the customer Traditional Product Development A Push System Manufacturers and retailers push product toward the consumer production The push system new styles are introduced seasonally and what doesn t sell driven is marked down Consumers choose from the abundance of available products and only participate by making a selection Alternative Product Development A Pull System Consumers become more demanding independent Requires a continuous flow of consumer information to shape product consumer driven Demand Activated Product Development by the late 1980s Demand Activated Product Development Evolution The First Wave from the early 1980s Building An Information technologies and Building the Infrastructure for a pull system The Second Wave Time Efficiencies Inventory Reduction Quick Response reduced cost The Third Wave By the mid 1990s Focusing on the Consumer Order to delivery a few months to a few weeks The Fourth Wave Markets of One segmenting down to the individual level Chris Anderson The Long Tail Demand Activated Product Development A strategy that uses information and manufacturing technology to efficiently produce goods with maximum differentiation with low cost production Mass Production Mass Customization Listening to the Consumer Spending behavior Impulse buying Routine purchases Lifestyle based shopping Consumer research Custom products or personalized services Qualitative Researcher listens to the consumer talk or observes consumers in natural settings and reports findings as descriptions of consumer types or categories of behavior Quantitative Researcher conducts surveys or experiments with a group of consumers the sample to understand a larger group the population and reports results in numerical data Asking What and Why Questions Focus Group Research Stimulus used ads storyboard 8 12 participants recruited by market research firms One or more people may dominate Not designed for consensus Depth Interview lengthy one on one interviews Consumer Anthropology methods originally used by anthropologists to study primitive tribes or subcultures have adapted to study consumers and buying behavior Interview teens in their rooms and look through their closets to understand the individual s taste Install a video camera in the store Researchers with a clipboard observe in store shopping behavior Relational Marketing Communicate with consumers through different media ad on TV or in print promotions in store directly Projective Techniques To allow people to reveal themselves in non threatening ways Ask to select a picture that corresponds to their feelings about a product brand or shopping situation Create a collage representing the personality of a brand Project deep emotions in this way Collaborative Filtering On the Web a person makes selections Software matches person s selections with those of thousands of others Consumer receives customized recommendation that reduces search time The company learns about customer s preferences Asking What and How Many Questions Mall Intercept Studies Intercept consumers in the mall Ask preliminary questions Facilities in the mall Takes several weeks to design study negotiate with study site distribute the Pretesting styles with consumers Consumers sit in front of computer screen and asked to indicate preferred research materials Style Testing Studies color styles etc Speed Survey Research Actual behavior may be different In store Testing Measure actual behavior not attitude or intention Showcase and Laboratory Stores Some manufacturers operate specialty stores as laboratories to test the viability of new products Museums to the product and offer a chance to present their entire line The stores are a place for the manufacturer to gather intelligence about what consumers want which products in the line are heating up and which are cooling down and which packaging and promotional initiatives are most effective Test stores Specialty store chains selling store labels designate certain stores as test sites Any store in the chain may be designated as a test store for a particular time period The test store is cleared of merchandise and reset with test merchandise Then business continues as usual Consumers are completely unaware that a test is underway Test Merchandise Groups A less expensive approach is to plant test groups of merchandise with ordinary merchandise When product developers monitor sales information from these test sites the company can fine tune sales potential by optimizing the selling price and color assortment They can also discover items that often are sold together as input for promotions and visual merchandising Panel Research Ask questions to a group of consumers over time to track changes in consumer attitudes and opinions Provide directional information Consumer Segmentation and Forecasting Consumer Generations Diversity Cross shoppers discount store to luxury store Chapter 9 Sales Forecasting The Future Real time Marketing 21st Century Marketing Executives become Information Gladiators Incoming information on consumer behavior and competitors actions Updated continuously as sales happen POS Marketers adjust the flow of goods or make changes in promotions and pricing The Balancing Act Anticipation and Improvisation The marketplace as a kaleidoscope where the handful of beads lock into one pattern holds it briefly and then cascades into a new configuration Shifts in the marketplace changes in tastes lifestyles immigration technological developments or prices of raw materials Chaos Theory patterns do not repeat exactly not in equilibrium orderly Think of the marketplace as a pile of sand with new sand sifting down disorder constantly Self organized critically The Fashion System on the Edge How do hits happen Complex System Buyers and Sellers interact with each other and share information Buyers cluster around products or styles forming patterns of preference An innovation enters the system may disappear almost immediately or may be adopted and spread through the system and if adoption reaches a critical mass it becomes a hit Hits can be powerful enough to change the relationships within a complex system Forecasting straightforward and accurate for products with long life cycles and steady sales