MKTG 301: Test 2
55 Cards in this Set
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consumer decision making process
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1. problem recognition
2.information search
3. alternative evaluation
4.purchase(Acquisition)
5. post purchase behavior
(Use and Evaluation)
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Problem Recognition
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a. Consumers’ unmet needs
b. Marketers can “create” a problem, (restless leg syndrome, etc)
c. Marketers can “activate” a problem recognition
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Search
(Strategies)
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a. Shopping, gathering information, seeking
b. “How does a Marketer assist in that search”
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Alternative Evaluation
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-go out and search for a solution or product
-compares brands that will solve the problem
a. Choice between products
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Purchase [Acquisition]
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a. Not just buying
Acquiring solution to consumer problems other than just buying item. (Bartering, financing to vehicles, use of credit cards now registry.) Strategies for acquiring product
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Use and Evaluation
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a. What is the after purchase marketing strategy
b. Cognitive Dissonance – post purpose tension state
i. Buyers remorse
ii. Marketer raises expectation too high
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Theories of consumer behavior
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1). Economic Man
2). Involvement theory
3). Social Theory
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Economic Man Theory [Rational Decision Maker]
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a. Objective Criteria
- Measurable, Numerical
Ex purchase of car looking at objectives like miles on car, kbb resale. Looking at subjective such as color, who drives the type of car?
b. Utility Maximizer
- Get the product with the greatest benefit
c. “…
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Involvement Theory [Active v. Passive Consumer]
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a. Three Different Types of Decision Making Types
(how much product information does the consumer have?) – Determines level of activity
(how much brand information does the consumer have?) – Determines level of activity
-Routine
-Limited Problem Solving
Extensive Proble…
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Routine
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– Lowest Involvement – satisfied level of product and brand information
Promotion Budget / Advertising Budget / Distribution Area
1. The lower involvement of consumer the less “personal selling” required
2. Broadcast Media – quick general information
3. Intensive – ma…
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Limited Problem Solving
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Sufficient product information, limited brand information
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Extensive Problem Solving
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– Highest Involvement – insufficient info on both
Promotion Budget / Advertising Budget / Distribution Area
1. The higher involvement level the more “personal selling” expected
2. Print Media – more detail, read at length
3. Selective – specific market distribution
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Social Theory [Social Beings]
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A. Macro Level Social Influences - large
B. Micro Level Social Influences – smaller unit – interpersonal relations available
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Macro Level Social Influences - large
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i. Culture – national character
ii. Subculture – ethnic, age, geographic
iii. Social Class – layer of society – upper class / middle class / lower class
1. Income
2. Occupation
3. Education Level
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CULTURE, SUBCULTURE AND SOCIAL CLASS INFLUENCE
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a. Verbal and Nonverbal Communication
b. Customs
c. Values
d. Lifestyles
e. Media Habits
f. Product References
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Micro-Level Social Influences
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Reference Groups > Information Influence, Normal Influence, Identification Influence
Opinion Leaders > Charismatic, Product Experts
Role Models > ex. Bill Cosby pudding/jello cups,
– celebrity status
Family > Family Life Cycle, Household Role's > Purchaser User, Initiator (kids seei…
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Marketing Information Systems (MIS)
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1. Internal Accounting Component –
Transactional data – sales, complaint, gathering of information
2. Marketing Intelligence Component –
Environmental Scanning – monitoring trends and events
3. Marketing Research – deals with studies of specific “problems” relat…
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TYPES OF MARKETING RESEARCH PROBLEMS
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1. Exploratory Research – preliminary research that brings the problem into greater focus
2. Descriptive Research – research that describes and existing state of nature
a. Who, what, when, where, how, and why stuff…
3. Experimental Research – deals with cause and effe…
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SECONDARY INFORMATION SOURCES AND PRIMARY INFORMATION
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1. Secondary Information Source – second hand, information that already exists
2. Primary Information Source – self gathered information
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Secondary Information Source
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a. Internal Records –
b. Business Publications –
c. Government Agencies – Census Bureau, “Demand of Day-Care” example
d. Trade and Professional Organizations
e. Research Consulting Firms –
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Primary Information Source –
self gathered information
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Qualitative Research Methods- i. open ended, what is being said, reactions, feelings, themes, etc
v.
Quantitative Research Methods
i. measurable, statistics, means, percentages
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Qualitative Research Methods
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...
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Qualitative
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1. Focus Groups –
2. Depth Interviews –
3. Projected Techniques – useful to get to the latent motives
4. Observation Techniques - HYBRID, both their shoes”
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Focus Group
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a. 5-12 people, small group discussion
b. 1-2 hours
c. video taped, nonverbal record, all the detail
d. moderator – asks open ended questions
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Depth Interviews
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a. 1 on 1 interview, may talk better alone
b. highly skilled interviewer, (psychologist)
c. 1-2 hours
d. video taped
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Projected Techniques
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a. articulate
b. Manifest Motives – are conscious of, will admit to, can articulate and describe
c. Word Association Test –
d. Cartoon Frustration Test – fill in the dialogue bubble
e. Story Completion Test – “instant coffee” example
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Observation Techniques
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a. Observe, not question it
b. More natural state
c. Use of cameras – traffic patterns, what catches attention
d. Physical Trace Evidence Analysis – examining used product
e. Physiological Measurement – devices,
f. Scanner – tracking products
g. My…
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Quantitative
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1. Consumer Panels – (not a focus group)
2. Surveys – gather statistical data
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Consumer Panels
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a. large representative sample of consumers
b. record information about their behavior (Nielson Ratings)
c. over a period of time – longitudinal studies
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Surveys
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· Mail / E-mail Surveys
· Telephone Surveys
· Personal Interviews – set an appointment, face-to-face
· Shopping Mall intercepts –
Self-administered
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Survey Selection Criteria –
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1) Total Cost – types of surveys cost more than others
2) Response Rate – might be worth incentive
3) Speed Factor – turn around on getting enough data
4) Amount of Data – keep it to 20 min
5) Respondent Control – instructions, control over respondent
6) A…
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Validity
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instrument measures what it is supposed to measure
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Reliability
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– consistency in results with repeated administrations of the instrument
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Representativeness
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ability to generalize the results to the greater population
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PRODUCT STRATEGY
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-Total Product Concept
-Packaging Functions
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Total Product Concept
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1. Tangible Product – functional and aesthetic features of the product
2. Augmented Product – service and image extras
3. Generic Product – psychological and operational benefits of the product
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Packaging Functions
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1. Product Protection – breakage, fresher, colder
2. Attention – 7 or 8 second to grab attention
3. Differentiation – “use packaging to make your product different” (class example: Leggs egg shape)
4. Target Marketing– does the design indicate something about the prod…
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Package Functions
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6. Safety / Liability – legal duty to warn of foreseeable dangers of using the product
a. Caution coffee is hot, for ages 3 and up, small
7. Environmental Concern –environmental info
8. Cross-promotion – company to company, promoting company website
9. Additiona…
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PRODUCT PORTFOLIOS
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-Cash Cows
-Stars
-Question Marks
-Dogs
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Cash Cows
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o High market share relative to closest competitors
o Low market growth rate –
-mature products (class example: soup / Campbell’s Soup)
-requires less money to maintain
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Stars
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o High market share
o High growth rate –
- Requires more money to maintain
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Question Marks
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(active market, but product is lagging behind / can it be fixed…?)
o Low market share
o High market growth rate
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Dogs
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(generally a waste of time and money)
o Low market share
o Low market growth rate
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Product Strategy Alternatives
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1. Market Penetration Strategy – current products ~> current markets
2. Market Development Strategy – current products ~> go after new markets
3. Product Development – new products ~> designed for current markets
4. Diversification – new products ~> go after new marke…
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Idea Generation Step
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a. Customers – asking customers what they want
b. Employees – asking employees for new ideas
c. Channel members – active retailers asking manufacturers for new product
d. Government – patent office, grants for new technology
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NEW PRODUCT DEVELOPMENT PROCESS
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helps to decrease the risk
1. Idea Generation Step – (Marketing Research) (“numbers game”)
2. Screening -
3. Concept Testing -testing the idea (still no new product made)
4. Business Analysis –
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Screening
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a. Top Management Involvement
i. Determine “Strategic Fit”
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Concept Testing
Testing for adoption / diffusion determinants
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a. Testing for adoption / diffusion determinants
Adoption – process that individuals go through in accepting something new
1. Awareness ~> Interest ~> Trial ~> Adoption
Diffusion – when an entire society adopts something (e-mail)
Relative Advantage –the advantage of usin…
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Concept testing
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Compatibility – technology, issues, values, lifestyles, (hybrid cars, direct deposit)
Observability – [visibility factor] – people walking around with iPods
Trialability – extent of which the new product can be tried on a risk free basis
Monetary Costs – what are people willing t…
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Business Analysis
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-Break Even Analysis
-Estimates of Market Potential
-Development-limited production
-Optional – Test Marketing
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Break Even Analysis
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TOTAL FIXED COST DIVIDED BY CONTRIBUTION PER UNIT
Total Fixed Cost – permanent by nature, salaries, rent, insurance, etc
Contribution per Unit – average selling price minus average variable cost
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Development
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Alpha Testing – function, durability, safety
Beta Testing – consumer testing, (behind the scenes) – Develop the Marketing Mix
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Optional
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CONS:
1. COST, TIM, COMPETATIVE EXPOSURE
PROS:
1. SALES AND PROFIT FORECASTS – selling in action
2. MAREKTING MIX EXPERIMENTATION – pricing/packaging
3. TARGET MARKET ANALYSIS – determining actual target market
4. CONSUMER PURCHASE PATTERNS – beware, do …
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PROS
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1. SALES AND PROFIT FORECASTS –action selling
2. MAREKTING MIX EXPERIMENTATION – pricing/packaging
3 TARGET MARKET ANALYSIS – determining actual target market
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Pros
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4. CONSUMER PURCHASE PATTERNS – beware, do they buy a 2nd and 3rd time?
5. CANIBALIZATION EFFECTS – take away from current sales?
6. COMPETATIVE REACTIONS – find out likely competitors and their actions
7. CONSUMER SUGGESTIONS –
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MKTG 301: Test 2