MKT 305 - HoyleSpring 2020GUIDELINES FOR THE CUSTOMER RESEARCH.docx

MKT 305 - Hoyle
Spring 2020
GUIDELINES FOR THE CUSTOMER RESEARCH PROJECT
SUBMISSION 1:
Brainstorming/conceptual analysis
One of the requirements for MKT 305 is the completion of a
customer research project that will account for 25% of a
student's final grade. This project has two submissions.
Submission 1 will be a brainstorming/conceptual analysis. This
portion of the project is worth 30% of the project grade or 7.5%
of a student’s final grade. The primary objective of this
submission is for groups to use conceptual frameworks
discussed in class to analyze and evaluate buyer behavior
among CMU students within a selected local service category.
CATEGORY SELECTION
Each group will be assigned to a specific service category to
research from those listed in Exhibit 1 of this document. Groups
will perform research on the same category for both submission
1 and submission 2.
BRAINSTORMING/CONCEPTUAL ANALYSIS
In this submission you are to use several of the theoretical
frameworks covered in class to analyze choice behavior in your
service category. Your analysis must include the following:
1.
An analysis of the consumption values that the
competitors/brands in your service category serve using the
Motivation Behind Market Choice Framework discussed in
class. Examine both the purchase decision as well as the choice
decision separately using the four consumption values discussed
in class (functional, social, emotional and epistemic value).

Identify all possible motivations under each consumption value
for both the purchase and the choice decisions.
2.
Identification and description of a minimum of at least four
benefit (need-based) segments in your category. Indicate which
competitors in the service category you believe to be best
positioned to satisfy each segment and which are in the worst
position. Give rationale for your choices.
3.
An analysis of perceived risks that could potentially affect
choice in your service category organized using the four types
of perceived risk discussed in class. For each risk you identify,
describe actual or potential strategies that might be used by
competitors (not customers) in the service category to alleviate
customer concerns about these issues.
DELIVERABLES
A printed hard copy of the analyses detailed aboveis due
Tuesday 2/25, by the end of class. This part of the project
requires groups to write up the required
brainstorming/conceptual analyses (consumption value analyses,
perceived risks, and benefit segments) plus any additional
conceptual analyses they may wish to submit.
GRADING
No group member will receive a grade for the written report
higher than that given to the group. In order to help insure
satisfactory participation by all, a group member evaluation
form will be collected at the end of the term (after Submission 2
is submitted). Those students consistently rated as poor
performers by others in their group will have their project
grades reduced according to the severity and consistency of the
negative ratings. Submission 1 will be graded based on the
depth (level of description and detail), breadth (number of
relevant items identified) and thoroughness of the analysis
(were important items omitted), the quality of the presentation
(writing, organization GSP, aesthetics) and the correctness of

the application of buyer behavior concepts (were terms used
correctly, were items classified in the correct category).
Submissions begin with a default grade of B which can then be
raised (or lowered) based on the extent to which the paper
distinguishes itself from the pack and establishes itself as better
(or worse) than the average submission based on the criteria
above. Attached is the grading rubric.
EXHIBIT 1:
List of Eligible Service Categories to Research
1.
Sub/sandwich shops (Subway, Jimmy John’s, Which Wich,
Firehouse, Panera)
2.
Groceries (Aldi, Wal-Mart, Target, Rics, Meijer)
3.
Full service (sit-down) dinner restaurants (Applebees, Texas
Roadhouse, Bennigans, Olive Garden, Ruby Tuesday’s,
Mountain Town)
4.
Ice cream (Dairy Queen, Culvers, Doozies, Pineapple Tiki)
5.
Coffee houses (Starbucks, Bigby, Ponder, Java City)
6.
Pizza delivery (Domino’s, Jet’s, Hungry Howies, Papa John’s,

Vin Trofeos)
7.
Sports bars (Buffalo Wild Wings, O’Kelley’s, The Cabin,
Hunter’s)
8.
Mexican food quick-service (Qdoba, Taco Bell, Taco Boy,
Chipotle)
MKT 305 Submission 1 Rubric
Grading criteria
Does Not Meet Expectations
Meets Expectations
Exceeds Expectations
1. Consumption Values- Purchase decision
●Depth (level of description and detail: quality of rationale)
●Breadth (number of relevant motivations identified; did not
overlook key factors)
●Presentation (writing, organization, GSP, aesthetics)
●Correct application of buyer behavior concepts (terms used
correctly, motivations classified in correct category).

Comments:
Letter Grade for this analysis:
2. Consumption Values- Choice decision
●Breadth (number of relevant motivations identified; did not
overlook key factors)
correctly, motivations classified in correct category).

Comments:
Grading criteria
Does Not Meet Expectations
Meets Expectations
Exceeds Expectations
3. Benefit (need-based) Segments
●Breadth (number of relevant segments identified; did not
overlook key segments; identified best worst positioned
competitor in each segment identified)

correctly, segments identified are legitimate need-based).
Comments:
4. Perceived Risks
●Breadth (number of relevant risks identified; did not overlook
key risks, identified risk alleviation strategies)

correctly, risks classified in correct category).
Comments:
Overall % Grade for Submission 1:
MKT 305
NEEDS COURSE PACKET
Strategic Framework of the Customer Buying Process
Stage
Key Customer Concept
Marketing Objective
Affected marketing activities
1
needs
Create Value
Produce solutions that meets the needs of a segment of
customers better than the competition
Product/service development*
Pricing
Benefit segmentation

2
perceptions
and attitudes
Sell Value
Get targeted customers to perceive that your solution meets
their needs better than the competitions ’solutions
Promotion*
Packaging
Pricing
Branding
Positioning
3
purchase
Deliver Value
Acquire orders from customers and fulfill these orders to the
customer’s satisfaction.
Distribution*
Pricing*
Customer Service
* most important activity
OUTLINE:
A. Needs Vs. Wants
B. The Motivational Process
1. Motivational Problems
2. Motivational energy vs. Motivational direction
C. Motivation Behind Market Choice
1. Two Levels of Market Choices:
2. Four Values Driving Choice
D. Benefit Segmentation
E. Measuring Customer Needs
F. Perceived Risk
1. Types Of Perceived Risk
2. How Customers Deal With Perceived Risk
G. Manifest vs. Latent (Covert & Hidden) Motives

NEEDS DISCUSSION QUESTIONS:
1. What motivates people to smoke cigarettes? Why would
someone who is aware of its undesirable consequences begin
smoking in the first place?
2. What is the distinction between needs and wants? Can
wants exist without needs? Can wants precede needs?
3. Can marketers create needs? Can marketers create wants?
What is the appropriate role of marketing with regard to
customer needs and wants?
4. What are the motivational problems that keep customers
out of the market for a particular product or service? How can
marketers address each of these issues?
5. What is the distinction between motivational energy and
motivational direction? What are the implications of each?
6. Analyze motivations for why people smoke cigarettes
using the motivation behind market choice framework. Do the
same for bowling.
7. Does emotional value ever drive the purchase behavior of
industrial (B to B) buyers? How? What about social value?
8. What is benefit segmentation? How does it differ from
traditional segmentation approaches? What are its advantages?
What are its disadvantages?
9. What are the requirements of a good benefit segment?
10. How do manifest motives differ from latent motives? How
do covert motives differ from hidden motives?
11. Is perceived risk a positive or a negative for marketers? Is
it more of an opportunity or a threat? Explain.
12. What strategies do customers use to help alleviate perceived
risk? How is this relevant to marketers?
“Oil company advertising has led people to the conclusion that
more expensive (higher grade) fuels will make their cars easier
to start, get more gas mileage, and last longer but this is
generally untrue…your engine has to be designed to use that

extra octane…the extra cost is just lining the pockets of the oil
companies”
Michael Solomon, Customer Behavior,
p. 92
The Appropriate Role of MARKETING WITH REGARD TO
NEEDS AND WANTS
Create wants, i.e., satisfy the needs of one or more segments of
customers better than anyone else.
Key points
1. Be “need” not product focused
examples: Smith Corona, American Trap Co., Blockbuster
2. Insufficient “just” to satisfy needs
example: Swiffer, Grill Glove
3. Satisfy all their needs
example: Diet Beer
4. Do not attempt to satisfy everyone with one solution.
example: Egg McMuffin, Curves
A Better Mousetrap
"If a man can write a better book, preach a better sermon, or
make a better mousetrap than his neighbor, though he builds his
house in the woods the world will make a beaten path to his
door.
Chester M. Woolworth (https://www.loc.gov/item/2017840634/
), when he was president and chairman of Animal Trap Co.
(https://www.woodstream.com/heritage )of America,
commissioned an industrial designer to come up with an even
better mousetrap. The finished product was a sleek, brown
plastic gadget that looked something like an upside-down

bathtub. It had a spring that snapped upward and strangled the
mouse when it nibbled the cheese (or peanut butter or
gumdrops, said by some to be the preference of discerning
mice). The trap was big enough to conceal a good-sized mouse
(except for the tip of its tail, which hung out), so that the
squeamish householder need never lay eyes on the victim. And
perhaps best of all, the trap was reusable -- press down on the
spring from the top and neatly drop the mouse into the garbage
pail.
But the Little Champ, as it was affectionately named, gathered
dust on the shelves of hardware stores while the tried-and-true
snap-trap continued to snag customers. Why? In a 1962
publication of the American Management Associations,
Woolworth mused over the plight of the Little Champ and
admitted that "we're still not sure. Perhaps it didn't look like a
mousetrap. Maybe it was priced wrong. The old traps cost about
$.07 [the Little Champ sold for about $.12].
Maybe it was the disposal feature. Many women just throw
away the $.07 trap -- with the mouse in it."
Indeed, this last guess proved to be the answer. More recent
market research shows that "the homeowner will, often as not,
throw the trap out with the rodent even though it could be used
over again," says John Reid. In which case, the old Victor snap-
trap suited the customer's purposes just fine -- it was cheap, it
was simple, and it didn't look like a designer mousetrap, so no
one felt any qualms about tossing it out.
http://www.inc.com/magazine/19850301/1091.html
MOTIVATION
The driving force within individuals that impels them to take
action in order to satisfy a need.
MOTIVATIONAL PROCESS MODEL
1. Unfilled need

↓
2. Awareness of unfilled need
↓
3. Tension
↓
4. Action
↓
Customer Motivation Problems –
Why customers do not take action to fill their needs – i.e. why
they stay out of markets.

1. Customer forgets about their need.
Strategy - Remind customers of their need
examples: Hallmark, Dentists, Jet Dry, Car Fax
2. Customer lacks the motivation to fill their need.
Strategy -Increase Customer Tension
examples: Ziebart, Scope, Orkin, Allstate
3. Customer is not aware of an effective solution to their need.
Strategy –Develop an effective solution for customers
examples: Wrigleys, Arm & Hammer, Excedrin Migraine
COMPARISON OF THE TWO COMPONENTS OF
MOTIVATION: ENERGY VS. DIRECTION
Motivational energy
Motivational direction
Definition
The extent to which the customer is motivated to take action to
fill their need.
The action(s) the customer takes to fill their need
Source of motivation
related to need strength
related to wants
Demand type
Primary
demand
Secondary demand
Indication this component is the problem
Customer fails to take action, does not enter your market
Customer buys from your competitor rather than you
.

MOTIVATION BEHIND MARKET CHOICE FRAMEWORK
Two Levels of Market Choices
1. THEPURCHASE DECISION
things that motivate someone to make a purchase in a particular
category.
Example: deciding to buy a smart phone.
2. THE CHOICE DECISION
things that motivate one’s purchase choice within a category.
Example: deciding to buy an Apple I-phone rather than a
Samsung Galaxy.
MOTIVATION BEHIND MARKET CHOICE FRAMEWORK
Four Consumption Values
1. UTILITARIAN VALUE
the ability of an alternative to provide functional benefits.
Examples: appliances (purchase); horsepower and fuel economy
of a car (car choice)
2. SOCIAL VALUE
The ability of an alternative to affect one's social image.
Examples: jewelery (purchase); luxury brand (car choice)
3. EMOTIONAL VALUE
The ability of an alternative to elicit positive feelings
Examples: music (purchase); design aesthetics (car choice)
4. EPISTEMIC VALUE
The ability of an alternative to provide novelty, or satisfy
curiosity.
Examples: online content (purchase); innovative new

technology in a car (car choice)
Don't Underestimate the Role of Emotion, Self-Image in B2B
Sales
B2C sales and marketing entities have long recognized the need
to connect the brand with the customer’s ego and sense of self.
If you can cultivate a brand or specific product that makes
customers feel better about themselves, the battle for the
purchase decision is practically won (and price sensitivity is
greatly reduced)! Brands like Starbucks® and Apple® are
champions at this.
In contrast, the role of customer ego has historically been
overlooked in B2B sales, in favor of the business benefits of our
solution – most often some combination of improved growth,
profitability and efficiency – delivered to the customer
organization. Certainly, these are key considerations for B2B
sales, but to overlook the emotional needs of individual
purchase decision makers is to miss key opportunities for sales
advantage and differentiation.
Next time you are mapping out the Features, Advantages and
Benefits of your product/service for a client organization, take
the time to run through the same process relative to your key
contact’s personal benefit. How will this purchase make his/her
life easier or make this individual look good to his/her boss and
peers? How might this purchase make the individual customer
feel smarter, cooler or more successful? What might this
purchase decision say about his/her level of sophistication,
relevance or thought leadership?
Taking extra time and thought to add this personal dimension to
your solution will help you build personal relationships and
cultivate advocates within the client organization. And with
purchase committees becoming more and more common,
cultivating fans within the client organization has become more
essential to our sales success. At the end of the day, companies

don’t buy products and services; people do. We’ve all heard that
familiar saying, now we just need to start living it!
BENEFIT SEGMENTATION
Grouping customers into segments based on similarity in
benefits sought
Benefit
Segmentation
Traditional segmentation
Definition
Grouping customers into segments based on common benefits
sought
Example: Tide vs. Cheer
Grouping customers into segments based on common
background characteristics such as demographics
Strengths
Provides strong focus for developing products/services and
message strategy
Examples: Toyota
Health clubs
Makes it easier to select media to reach the segment
Weaknesses
1. May not be able to come up with a good demographic profile
for the segment
Example: black licorice
2. A few markets do not require customers to make tradeoffs
Example: toothpaste
https://www.youtube.com/watch?v=z-o_LI8-5oY
Customers in the same segment may have conflicting needs
Example: GMC Syclone targeted to young male

REQUIREMENTS OF A GOOD NEED BASED SEGMENT
1. Segment defined by benefitsought not by buyer
characteristics or product type/characteristics.
Example: mowers that mow lawns quickly (wide cutting decks)
or mowers you do not have to push vs. men 25-34 or lawn
tractors
2. Benefitsought must be a major factor (trigger) for some group
of buyers.
Example: easy starting push mowers vs. push mowers with cup
holders
3. Segment must be large enough to be worth targeting
Example: lawn tractors for tight, heavily treed lawns (zero
radius) vs. lawn tractors for bored mowers (equipped with
entertainment systems)
4. Benefit sought should be a potential source of competitive
advantage (i.e. something most competitors cannot provide).
Example: rechargeable plug-in lawn tractors vs. lawn tractors
with automatic transmission
Which of the following are legitimate need-based segments for
supermarket coffee?
1. Males 25-34
2. Young urban professionals
3. Price-conscious drinkers
4. Energy seekers
5. College students
6. Quality coffee connoisseurs
7. Fast preparation time seekers
8. Hazelnut flavored coffee lovers

9. Families
10. Office workers
11. Coffee drinkers without a coffee maker
12. Late shift workers
13. K-cups
14. Small pot/batch coffee drinkers
15. Portable/Ready-to-drink hot coffee drinkers
16. Folger’s brand loyals
MEASURING CUSTOMER NEEDS
Attribute Importance: Have respondents indicate how important
different attributes are to them when evaluating different
competitors.
Example: fast food hamburger restaurants:
very
very
unimportant important
Taste of food 1 2 3 4
5 6 7
Price 1 2 3
4 5 6 7
Speed of service 1 2 3 4
5 6 7
Menu variety 1 2 3 4
5 6 7
Location 1 2 3
4 5 6 7
3 TYPES OF CUSTOMER MOTIVES
Type of motive
Customers know their true motivation?
Customers will tell you their true motivation?

Manifest
yes
yes
Latent: covert
yes
no
Latent: hidden
no
no
PERCEIVED RISK:
Risk = probability x cost
Undesirable Consequences Customers Seek To
Avoid When Making Purchase Decisions
TYPES OF PERCEIVED RISK:
1. Social Risk:
risk that a wrong choice will result in embarrassment or
disapproval from others
examples: horse racing, clothing, store brands
2. Performance Risk:
risk that a wrong choice will not perform as well as expected
examples: bleach, pain relievers, logistics, fruit
3. Financial Risk:
risk that a wrong choice will be overpriced or lead to negative
financial consequences.
examples: used cars, retailing, houses
4. Physiological Risk:
risk that a wrong choice may cause physical harm
examples: Volvo, chain saws, laser eye surgery
HIGH OR LOW PERCEIVED RISK PURCHASES?

1. Cell Phone
2. Paper Towels
3. Flour
4. Car
5. Shoes
6. Jeans
7. Socks
8. Milk
9. Chainsaw
10. Oil Change
Sample Questions needs vs. wants
1. Which of the following is correct.
a. Needs are defined as requirements that people must have in
order to survive.
b. Wants are defined as things a person desires but does not
need.
c. A person cannot want a product unless it addresses their
needs.
d. a and b
2. A person wishes to go to Taco Bell in order to relieve their
hunger. In this scenario ________ represents the person’s need
and _________ represents the person’s want.
a. Taco Bell/hunger
b. hunger/Taco Bell
c. hunger/hunger
d. Taco/Bell/Taco Bell
Sample questions: motivational process
1. Which of the following is correct regarding the motivational
process model presented in class?
a. The first stage is “tension”
b. the action stage leads to the tension stage
c. the tension stage leads to the action stage
d. the need stage leads to the tension stage

e. the final stage is “awareness of a need”
2. According to class discussion on the motivational process
model, what strategy is most appropriate for a company who has
an innovative and effective new solution for a problem that is of
great concern to customers?
a. create a need
b. remind customers of their need
c. increase customer tension
d. suggest an action customers can take
Sample Question: Motivational energy vs. motivational
direction
Which of the following reasons why someone does not purchase
Coppertone sunscreen would be attributed to “motivational
direction” rather than to “motivational energy”.
a. He is unaware of the dangers of the sun and how sunscreen
can protect his skin from damage.
b. He is aware of the dangers of the sun but he never thinks
about buying sunscreen when he is shopping.
c. He is aware of the dangers of the sun but is not concerned
enough to buy sun screen.
d. He is concerned about protecting his skin from sun damage
but he always buys Banana Boat.
Sample questions: consumption values
1. A customer chooses to go to the Horseshoe Lounge
because he thinks it is the best place in town to meet new
people. Which consumption value motivated this customer’s
choice of bar?
a. utilitarian value
b. social value
c. emotional value
d. epistemic value

2. A customer chooses to join the local chapter of the Rotary
Club because he thinks this membership will help communicate
to others that he is someone who is involved in the community.
Which consumption value motivated this decision?
b. social value
c. emotional value
d. epistemic value
3. A customer decides to go on an Alaskan Cruise in order to
experience what life is like that far north and to see what
whales and glaciers really look like in person. Which
consumption value motivated this decision?
b. social value
c. emotional value
d. epistemic value
4. A customer decides to go to the Lowes to buy a
refrigerator because he wants to support the sponsor of his
favorite race car driver Jimmy Johnson. Which consumption
value motivated this decision?
b. social value
c. emotional value.
d. epistemic value
1. A customer decides to buy the Braun blender they want
from Wal-Mart because the store’s price match guarantee
assures them that if they see the same blender at another store
for a lower price within two weeks of purchase, Wal-Mart will
give them a refund for the price difference. This customer’s

decision to buy from Wal-Mart was due to their desire to deal
with which type of perceived risk?
a. social risk
b. performance risk
c. financial risk
d. physiological risk
2. A customer decides to buy a plain white Toyota Camry
because they do not want to drive an attention- getting vehicle
that might attract the awareness of potential carjackers or the
police. This customer’s purchase choice was due to their desire
to deal with which type of perceived risk?
a. social risk
b. performance risk
c. financial risk
3. A customer needs to rent, sight unseen, a beach villa in
Myrtle Beach for a week of vacation. She ended up renting a
moderately priced villa because she was afraid the less
expensive units that were available might be in poor condition.
This customer’s purchase choice was due to their desire to deal
with which type of perceived risk?
a. social risk
b. performance risk
c. financial risk
4. A customer who has never tanned before because they find
tanning salons to be intimidating, selects to use a particular
local salon because they offer a free 30 minute orientation
session on tanning etiquette and how to properly use the salon’s
facilities. This customer’s purchase choice was due to their
desire to deal with which type of perceived risk?
a. social risk
b. performance risk

c. financial risk
18

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MKT 305 - HoyleSpring 2020GUIDELINES FOR THE CUSTOMER RESEARCH.docx