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Lamb, Hair, McDaniel

The Marketing

Environment

1

Chapter 4

2012-2013

(C) 2014 Cengage Learning Inc. All Rights Reserved.

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(C) 2014 Cengage Learning Inc. All Rights Reserved 2

Target Market

A defined group most likely to buy a

product

Changes as consumers age

External elements change

consumers desires

1

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Social Factors

Values

Attitudes

Lifestyle

2

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Component Lifestyles

The practice of choosing goods

and services that meet ones

diverse needs and interestsrather than conforming to a

single, traditional lifestyle.

Todays consumers want multifunctional

products

No longer defined only by occupation2

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The Role of Social Media in

Communication

Social Media allow the creation andexchange of user-generated contentand include several formats that

allow for:One-to-one communication

One-to-many communication

Many-to-many communication

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Demographic Factors

People are the basis for any market

Demographic characteristics relate

to buyer behavior Demographic cohorts have their own

needs, values, and consumption

patterns.

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Tweens

812 years old

Great spending power

Attitudes, access to information,

sophistication well beyond their

years

Clothing, home dcor


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Generation Y

19791994

Between the late teens and 34 year

olds

Dramatic lifestyle changes

Impact by the recession

Tech-savvy generation Surfing the Web and social media


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Generation X

19651978

Latchkey childrenproducts of

dual career households (or divorced

or separated parents).

Independent, resilient, adaptable,

cautious and skeptical


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Baby Boomers

19461964

Late forties to mid sixties

Life expectancy at 77.4

Willing to change brands and try

new things

Affluent, flexible and experienced


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Economic Factors

Purchasing

Power

Inflation

Recession

ConsumersIncome

5

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Economic factors

Consumers income

education andidentifying target markets

Purchasing powerrelative to cost of living

Inflationoutsourcing

Recessionstore brands, coupons (fueldockets)


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Technological Factors

The need for R&D to stimulate

innovation

R&D helps to develop products to

help consumers

Meet the needs and wants of

consumers


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Research

Basic Research

Applied

Research

Pure research that aims to

confirm an existing theory or

to learn more about a

concept phenomenon.

An attempt to develop new

or improved products

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Stimulating Innovation

Build scenarios

Enlist the web

Talk to early adopters

Use marketing research

Create an innovative environment

Cater to entrepreneurs


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Cengage Learning Inc. 2013. All Rights Reserved. 16

The Role of

Marketing Research

Diagnostic

Predictive

Descriptive

Gathering and

presenting factual

statements

Explaining data

ddress what if

questions

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The Marketing Research

Project

Marketing

Research

Problem

Marketing

Research

Objective

Management

Decision

Problem

Determining what information is

needed and how that information

can be obtained efficiently and

effectively.

The specific information needed to

solve a marketing researchproblem; the objective should be toprovide insightful decision-makinginformation.

A broad-based problem that usesmarketing research in order for

managers to take proper actions.

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Collect

Data

Specify

Sampling

Procedure

Plan Design

Primary Data

Define

Problem

Analyze

Data

Prepare

Present

Report

Follow Up

1

23

4

5

6

7

Exhibit 9.1The Marketing Research

Process


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The Dove Real Beauty Campaign

For Self esteem

Changing perceptions

Understanding consumers


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Political and Legal Factors

New technology

Society

Businesses

Consumers

Laws and Regulations Protect:

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Understanding Regulatory

Bodies

ACCC

Ombudsman

Consumer protection in Australia

Misleading and deceptive conduct

Monopoly and anti-competition conduct

Rise of consumer privacy issues

Internet as a predatory tool


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Competitive Factors

Market Share

and Profits

Firms must work

harder to maintain

profits and market

share.

Global Competition

More foreign firms

are enteringmarket.

Foreign firms now

compete on

product quality.

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2013 by Cengage Learning Inc. All Rights Reserved.23

Lamb, Hair, McDaniel

Chapter 6

Consumer

Decision

Making

2012-2013

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2013 by Cengage Learning Inc. All Rights Reserved. 24

Understanding Consumer

Behavior

Consumerbehavior

consumers makepurchase decisions

consumers use anddispose of product

= HOW

1

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Need Recognition

Result of an imbalance between actual and

desired states.

Need recognition is the first

stage in the decision-making process

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Stimulus

Any unit of input affecting one or

more of the five senses:

sight

smell

taste

touch

hearing

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Internal Stimuli

Occurrences which you experience

e.g. thirst, hunger


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Information Search

Internal Information Search

Recall information in memory

External Information search

Seek information in outsideenvironment

Nonmarketing controlled Marketing controlled

2

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External Stimuli

Are influences from an outside

source such as someones

recommendation of a new

restaurant, colour of anautomobile, advertising,

promotion, etc


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External Information Searches

Need More

Informat ion

More RiskLess knowledge

Less product experienceHigh level of interest

Lack of confidence

Less RiskMore knowledge

More product experienceLow level of interest

Confidence in decision

Need Less

Informat ion

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Cognitive Dissonance

Inner tension that a consumer

experiences after recognizing

an inconsistency between

behavior and values or

opinions.

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More

Involvement

Less

Involvement

RoutineResponseBehavior

LimitedDecisionMaking

ExtensiveDecisionMaking


Consumer Buying Decisions

and Consumer Involvement

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the amount of time and effort a buyer

invests in the search, evaluation, and

decision processes of consumerbehavior.

Involvement


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Factors Determining the Level

of Consumer Involvement

Situation

Social Visibility

Interest

Perceived Risk ofNegative Consequences

Previous Experience

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Types of Involvement

Product Involvement

Situational Involvement

Shopping Involvement

Enduring Involvement

Emotional Involvement


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Factors Influencing Buying Decisions

SocialFactors

IndividualFactors

Psycho-logical

Factors

CulturalFactors

CONSUMERDECISION-MAKING

PROCESS

BUY /DONT BUY

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Cultural Influences

Language, myths,

customs, rituals,

and laws that

shape the

behaviour of thepeople


Values

Norms

Attitudes

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Social Influences

ReferenceGroups

OpinionLeaders

FamilyMembers

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Individual Influences

Gender

AgeLife Cycle

PersonalitySelf-Concept

Lifestyle


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PsychologicalInfluences

Perception

Motivation

Learning

Beliefs & Attitudes


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Learning

Creates changes in behaviourthrough experience and practice

Experiential learninge.g. coldmedicine

Conceptual learninge.g. Diet coke

and artificial sweetener Reinforcement and repetition

Stimulus generalization b i ll i h d

ch 4 and 6(1)

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