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  1. 1. 1 - 1 Chapter 1 Consumers Rule By Michael R. Solomon Consumer Behavior Buying, Having, and Being Sixth Edition
  2. 2. 1 - 2 • What useful ways can marketers categorize Gail as a consumer? • How do others influence Gail’s purchase decisions? • What role did brand play in Gail’s surfing habits? • What other factors influence Gail’s evaluation of products? Opening Vignette: Gail
  3. 3. 1 - 3 What is Consumer Behavior? • Consumer Behavior: – The study of the processes involved when individuals or groups select, purchase, use, or dispose of products, services ideas, or experiences to satisfy needs and desires • Role Theory: – Identifies consumers as actors on the marketplace stage • Consumer Behavior is a Process: – Exchange: A transaction in which two or more organizations give and receive something of value
  4. 4. 1 - 4 Some Issues That Arise During Stages in the Consumption Process Figure 1.1
  5. 5. 1 - 5 Consumer Behavior Involves Many Different Actors • Consumer: – A person who identifies a need or desire, makes a purchase, and then disposes of the product • Many people may be involved in this sequence of events. – Purchaser / User / Influencer • Consumers may take the form of organizations or groups.
  6. 6. 1 - 6 Consumers’ Impact on Marketing Strategy • Market Segmentation: – Identifies groups of consumers who are similar to one another in one or more ways and then devises marketing strategies that appeal to one or more groups • Demographics: – Statistics that measure observable aspects of a population • Ex.: Age, Gender, Family Structure, Social Class and Income, Race and Ethnicity, Lifestyle, and Geography
  7. 7. 1 - 7 A Lesson Learned • Nike was forced to pull this advertisement for a running shoe after disabilities rights groups claimed the ads were offensive. • How could Nike have done a better job of getting its message across without offending a powerful demographic?
  8. 8. 1 - 8 Market Segmentation Finely-tuned marketing segmentation strategies allow marketers to reach only those consumers likely to be interested in buying their products.
  9. 9. 1 - 9 Consumers’ Impact on Marketing Strategy (cont.) • Relationship Marketing: Building Bonds with Consumers – Relationship marketing: • The strategic perspective that stresses the long-term, human side of buyer-seller interactions – Database marketing: • Tracking consumers’ buying habits very closely, and then crafting products and messages tailored precisely to people’s wants and needs based on this information
  10. 10. 1 - 10 Marketing’s Impact on Consumers • Marketing and Culture: – Popular Culture: • Music, movies, sports, books, celebrities, and other forms of entertainment consumed by the mass market. – Marketers play a significant role in our view of the world and how we live in it.
  11. 11. 1 - 11 Popular Culture Companies often create product icons to develop an identity for their products. Many made-up creatures and personalities, such as Mr. Clean, the Michelin tire man and the Pillsbury Doughboy, are widely recognized figures in popular culture.
  12. 12. 1 - 12 Marketing’s Impact on Consumers: The Meaning of Consumption • The Meaning of Consumption: – People often buy products not for what they do, but for what they mean. – Types of relationships a person may have with a product: • Self-concept attachment • Nostalgic attachment • Interdependence • Love
  13. 13. 1 - 13 Marketing’s Impact on Consumers: The Meaning of Consumption (cont.) • Consumption includes intangible experiences, ideas and services in addition to tangible objects. • Four types of Consumption Activities: – Consuming as experience – Consuming as integration – Consuming as classification – Consuming as play
  14. 14. 1 - 14 Marketing’s Impact on Consumers: The Global Consumer • By 2006, the majority of people on earth will live in urban centers. • Sophisticated marketing strategies contribute to a global consumer culture. • Even smaller companies look to expand overseas. • Globalization has resulted in varied perceptions of the United States (both positive and negative).
  15. 15. 1 - 15 The Global Consumer American products like Levi jeans are in demand around the world.
  16. 16. 1 - 16 Marketing’s Impact on Consumers: Virtual Consumption • The Digital Revolution is one of the most significant influences on consumer behavior. • Electronic marketing increases convenience by breaking down the barriers of time and location. • U-commerce: – The use of ubiquitous networks that will slowly but surely become part of us (i.e., wearable computers, customized advertisements beamed to cell phones, etc.) • Cyberspace has created a revolution in C2C (consumer-to-consumer) activity.
  17. 17. 1 - 17 Blurred Boundaries Marketing and Reality • Marketers and consumers coexist in a complicated two-way relationship. • It’s increasingly difficult for consumers to discern the boundary between the fabricated world and reality. • Marketing influences both popular culture and consumer perceptions of reality.
  18. 18. 1 - 18 Blurred Boundaries Marketing managers often borrow imagery from other forms of popular culture to connect with an audience. This line of syrups adapts the “look” of a pulp detective novel.
  19. 19. 1 - 19 Marketing Ethics and Public Policy • Business Ethics: – Rules of conduct that guide actions in the marketplace – The standards against which most people in the culture judge what is right and what is wrong, good or bad • Notions of right and wrong differ among people, organizations, and cultures.
  20. 20. 1 - 20 Needs and Wants: Do Marketers Manipulate Consumers? • Consumerspace • Do marketers create artificial needs? – Need: A basic biological motive – Want: One way that society has taught us that need can be satisfied • Are advertising and marketing necessary? – Economics of information perspective: Advertising is an important source of consumer information. • Do marketers promise miracles? – Advertisers simply don’t know enough to manipulate people.
  21. 21. 1 - 21 • This ad was created by the American Association of Advertising Agencies to counter charges that ads create artificial needs. • Do you agree with the premise of the ad? Why or why not? Discussion Question
  22. 22. 1 - 22 Public Policy and Consumerism • Consumer efforts in the U.S. have contributed to the establishment of federal agencies to oversee consumer-related activities. – Department of Agriculture – Federal Trade Commission – Food and Drug Administration – Securities and Exchange Commission – Environmental Protection Agency • Culture Jamming: – A strategy to disrupt efforts by the corporate world to dominate our cultural landscape
  23. 23. 1 - 23 The Consumer Product Safety Commission
  24. 24. 1 - 24 Culture Jamming • Adbusters Quarterly is a Canadian magazine devoted to culture jamming. This mock ad skewers Benetton.
  25. 25. 1 - 25 Consumerism and Consumer Research • Kennedy’s “Declaration of Consumer Rights” (1962) • Green Marketing: – When a firm chooses to protect or enhance the natural environment as it goes about its activities • Reducing wasteful packaging • Donations to charity • Social Marketing: – Using marketing techniques to encourage positive activities (e.g. literacy) and to discourage negative activities (e.g. drunk driving)
  26. 26. 1 - 26 Consumer Related Issues • UNICEF sponsored this advertising campaign against child labor. The field of consumer behavior plays a role in addressing important consumer issues such as child exploitation.
  27. 27. 1 - 27 The Dark Side of Consumer Behavior • Consumer Terrorism: – An example: Susceptibility of the nation’s food supply to bioterrorism • Addictive Consumption: – Consumer addiction: • A physiological and/or psychological dependency on products or services • Compulsive Consumption: – Repetitive shopping as an antidote to tension, anxiety, depression, or boredom
  28. 28. 1 - 28 The Dark Side of Consumer Behavior (cont.) • Consumed Consumers: – People who are used or exploited, willingly or not, for commercial gain in the marketplace • Illegal Activities: – Consumer Theft: • Shrinkage: The industry term for inventory and cash losses from shoplifting and employee theft – Anticonsumption: • Events in which products and services are deliberately defaced or mutilated
  29. 29. 1 - 29 Consumer Behavior As a Field of Study • Consumer behavior only recently a formal field of study • Interdisciplinary influences on the study of consumer behavior – Consumer behavior studied by researchers from diverse backgrounds – Consumer phenomena can be studied in different ways and on different levels
  30. 30. 1 - 30 Journal of Consumer Research
  31. 31. 1 - 31 The Pyramid of Consumer Behavior Figure 1.2
  32. 32. 1 - 32 Consumer Behavior Disciplines • The Issue of Strategic Focus – Should CB have a strategic focus or be studied as a pure social science? • The Issue of Two Perspectives on Consumer Research – Positivism (modernism): • Paradigm that emphasizes the supremacy of human reason and the objective search for truth through science – Interpretivism (postmodernism): • Paradigm that emphasizes the importance of symbolic, subjective experience and meaning is in the mind of the person
  33. 33. 1 - 33 Positivist vs. Interpretivist Approaches to CB
  34. 34. 1 - 34 Taking it From Here: The Plan of the Book • Section I – Consumer Behavior • Section II – Consumers as Individuals • Section III – Consumers as Decision Makers • Section IV – Consumers and Subcultures • Section V – Consumers and Culture
  35. 35. 1 - 35 The Wheel of Consumer Behavior Figure 1.3