understanding consumer behavior as a foundation for your marketing craft

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Human Pursuit of Happiness in the World of Goods MYCBBOOK.COM

Welcome to the Fascinating World of Consumers


© Open Mentis 2012


OpenMentis.com MYCBBOOK.COM

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The New Age of Consumer Empowerment

Welcome to the Consumer Age of Web 2.0

Arianna lives in Cincinnati, Ohio. Hear her

rave about her new pair of shoes!

These are no ordinary shoes. They are uniquely mine. With some priceless elements of my autobiography built into them. They are my signal to the world as to who I am. I wear them with spirit, glee, and pride. I designed them, myself!

I had been dreaming of designing my own pair of shoes for some time. So, on the afternoon of November 22, 2011, I sat down at my laptop and launched Keds.com. The Keds design tab led me step-by-step through the process of creating the shoe I wanted. I had the option of choosing the basic style and then applying my own design and paint to the upper, lower, left and right quarters, tongue, sole, lining, laces, and even eyelets. I made these choices—giving shape to my needs and my tastes.

Viola, I am now a co-creator !

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1. Define and

Dissect

Consumer

Behavior

3. Consumer

needs and

wants

4. Five

Resources All Humans Have

6. The

purpose of

business & of

marketing, and

the power and

limits of marketing

to influence CB

5. Four

Consumption

Values

2. Five

Visions of the

Consumer

Learn Apply Experience

C h a p t e r O b j e c t i v e s

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We Are Consumers 24-7!

• We are always consuming something. (like the clothes we are wearing)

• We are sometimes planning future consumption

• We are sometimes enjoying the memory of past

consumption.

Q. Is this person being a consumer at this moment?

Can you think of any moments when you are

NOT being a Consumer?

Yes No

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Five VISIONS of CONSUMER

1. Consumer As Problem Solver

2. As Economic Creature

3. As a Computer

4. As a Shopper

5. As a Reveler

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WHAT IS CONSUMER BEHAVIOR?

Consumer Behavior is the Mental

and Physical Activities undertaken

to Acquire and Consume the

Products and Services so as to

fulfill Needs and Wants.

Physical Activity: Buying a product;

preparing a product for consumption, etc.

Mental Activity: Evaluating a product in

your mind

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NEED and WANT

NEED: A Discomforting Human Condition

WANT: A Desire for a Specific Product so as to

Alleviate That Condition

Note that we do not limits needs

to basic survival, nor do we think

of wants as luxuries. Nor do we

confuse product with needs (as in “I need coffee, therefore

coffee is my need!”).

Read in the chapter about the merits of this

conception of needs and wants.

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THREE ESSENTIALS of

CONSUMER BEHAVIOR

1. Exchange. An interchange

between two parties where

each receives value

2. Resources. Something that

others value

3. Value. Sum total of all benefits

we receive from a product USER

U Utilitarian

S Social

E Ego-Identity

R Recreation/

Hedonic

Five Resources: Money

Time

Physical energy

Knowledge & Skills

Social capital

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V. A. L. U. E.

What consumers seek in marketplace

exchanges

1. Utility

2. Social

3. Ego/identity

4. Recreation

Which values does this kinetic dress offer consumers?

(Kinetic dress, Vilkas, from xslab.net)

Review pages 12-13 and discuss

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F i v e R e s o u r c e s

Review these on p. 11 and then

Score yourself on each on a 10-point scale

Money

Time

Physical energy

Knowledge & Skills

Social capital

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DOES MARKETING CREATE A NEED?

Review p. 14-15 and discuss:

Consumers who might want these products--from

where do they learn/acquire these needs/wants?

Would

Marketing

Create a

Need for

these

products?

In every consumer?

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1. What consumers really need (for survival) are just the basics

(e.g., food, clothing, shelter). As to all other products,

consumers come to believe they need them because marketers

tell them so.

2. Marketers create new products. Until then, consumers

manage with whatever is available. By creating new products,

marketers created consumer needs for those products.

3. Marketers package products and create messages that lure

consumers. By themselves, many of the products would not

have attracted consumers.

4. Marketers flood the media with commercials and deals;

exposed to a barrage of commercial messages day-in and day-

out, it is natural for consumers to succumb

YES

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1. To limit consumer needs to basic survival is to limit

consumers to mere biological beings. As social and

psychological beings, their social and psychological needs

are just as important.

2. Products are not needs, so creating products cannot

equal creating needs. Products are solutions to needs,

which must already exist in consumers.

3. Many products fail despite heavy marketing. Thus, not

marketing but the product’s benefits (including social and

psychological benefits) cause consumers to want them.

4. Consumers don’t really trust marketers anyway. Rather,

their product choices are based on advice from

independent sources and influence from peers.

NO

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DOES MARKETING CREATE A NEED? 1. To limit consumer needs to basic

survival is to limit consumers to mere

biological beings. As social and

psychological beings, their social and

psychological needs are just as

important.

2. Products are not needs, so creating

products cannot equal creating needs.

Products are solutions to needs, which

must already exist in consumers.

3. Many products fail despite heavy

marketing. Thus, not marketing but the

product’s benefits (including social and

psychological benefits) cause

consumers to want them.

4. Consumers don’t really trust

marketers anyway. Rather, their product

choices are based on advice from

independent sources and influence

from peers.

NO

1. What consumers really need (for

survival) are just the basics (e.g., food,

clothing, shelter). As to all other

products, consumers come to believe

they need them because marketers tell

them so.

2. Marketers create new products. Until

then, consumers manage with whatever

is available. By creating new products,

marketers created consumer needs for

those products.

3. Marketers package products and

create messages that lure consumers. By

themselves, many of the products would

not have attracted consumers.

4. Marketers flood the media with

commercials and deals; exposed to a

barrage of commercial messages day-in

and day-out, it is natural for consumers

to succumb

YES

Now, decide which side you are on and why?

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DOES MARKETING CREATE A NEED? 1. To limit consumer needs to basic survival is to limit

consumers to mere biological beings. As social and

psychological beings, their social and psychological

needs are just as important.

2. Products are not needs, so creating products cannot

equal creating needs. Products are solutions to needs,

which must already exist in consumers.

3. Many products fail despite heavy marketing. Thus,

not marketing but the product’s benefits (including

social and psychological benefits) cause consumers to

want them.

4. Consumers don’t really trust marketers anyway.

Rather, their product choices are based on advice from

independent sources and influence from peers.

NO

1. What consumers really need (for survival) are just the

basics (e.g., food, clothing, shelter). As to all other

products, consumers come to believe they need them

because marketers tell them so.

2. Marketers create new products. Until then,

consumers manage with whatever is available. By

creating new products, marketers created consumer

needs for those products.

3. Marketers package products and create messages

that lure consumers. By themselves, many of the

products would not have attracted consumers.

4. Marketers flood the media with commercials and

deals; exposed to a barrage of commercial messages

day-in and day-out, it is natural for consumers to

succumb

YES

Now, decide which side you are on and why?

The side you choose will impact your entire life as

a marketer, hugely. If you adopt the “Yes”

perspective, the kind of marketing you will create

and embrace will be materially different from the

one created under the “No” perspective. Also

materially different will be your life satisfactions!

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What is the purpose of business?

And of marketing?

Now, do you still believe that it is:

• To Make Money

• To create consumer needs

• To mastermind the consumer mind

Closely read this topic on p. 18

Or you believe, instead, that it is:

(Fill-in your answers below)

….......................................................

…………………………………………

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The Age of the Empowered Consumer

The age of Co-creation & personalization

The age of the authentic experience

The age of collaborative consumption

The Age of the Consumer in the driver’s

seat

Which of these trends do you

personally find useful in your

own firm?

Review this rich material on p. 20-22 and then discuss:

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The age of Co-creation, personalization

On Zazzle.com, you can customize 49 products: clothing (T-shirts, hoodies, hats, etc.), accessories (ties, necklaces, bags, etc.), cards and postage, office products, home products, art posters, and cases for your iPhones, iPads, Blackberrys, and Samsung Galaxy S. Prices are reasonable (hats: $14.95; men’s ties: $29.95; greeting cards: $2.95; iPad cases: $49.95 and up, etc.), and the customized items are shipped within 24 hours!

Z a z z l e Anything

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The age of the consumer in the driver’s seat

Get it here, get it now

Zaarly This U.S. company, launched in May 2011, is eBay in reverse. Consumers post what they want, when, and how much they are willing to pay for it. Then other consumers (as well as conventional sellers) offer to fulfill the consumers’ needs. The notable feature is the kinds and varieties of needs that you can post: baby-sitting services, a wedding singer, a chance to ride in a sports car, interior design advice, and the like. You can post your order on the Web and also on your mobile with an app; no need to tell it where you are—the “hyper-local” app already knows. Zaarly is a first, in that it is buyer-driven, and delivers in the “here and now” (e.g., want coffee delivered in an hour). The company boasts over 9.1 million posts in 200 U .S. cities (as of November 2011). And now its name is also a verb: its Web site offers a step-by-step guide, “How to Zaarly”!

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The age of empowerment

On October 1, 2011, Molly Katchpole, a 22-year old Roger Williams University student, posted a petition on Change.org against Bank of America’s proposed $5-a-month debit card fee. By the month’s end, more than 300,000 people had signed the petition. And more than 20,000 people had pledged to close their Bank of America checking accounts. On November 1, the Big Bank aborted the plan!

David vs. Goliath

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The PURPOSE of MARKETING is to help

the consumer experience the proverbial

tattoo that is already within him/her.

The Tattoo

is Already Inside the Consumer

The desire to wear a shoe like

this is already inside the

consumer

Tattoo : Desire

To satisfy the consumer, you have to

bring that tattoo out.

Tattoo as a metaphor

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Romancing the Consumer Maxwell House In July 2011, Maxwell House Canada opened its second

Optimism Café in Toronto (the first was in Montreal), giving away a free cup

of coffee throughout the month of July. As part of its Brew Some Good

campaign, it launched its Is Your Cup Half Full or Half Empty Optimism

campaign. It invited consumers to take an optimism break and post a video

clip or a letter on its Web site. Among the posted videos was this one :

A blind person sat on a sidewalk with a cardboard sign that read “I’m blind. Please help.” Passersby occasionally dropped a few small coins. Then a woman came by and wrote something on the other side of the cardboard. For the rest of the day, people came by and emptied their pockets of change. The woman had changed the sign to read: “It is a beautiful day. But I can’t see it!”

The Art of

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Learn Apply Experience

Review your understanding of CB

1. How does the book define Consumer NEEDS and WANTS

and how it differs from your everyday speech. Why

defining these in this way is helpful to marketers?

2. Do you believe marketing creates consumer needs?

Explain. Also articulate how your belief on this will impact

your work as a marketer?

3. How are today’s consumers more empowered?

4. What five resources all humans have and how they are

usable in exchange?

5. What four values consumers seek (USER). How does your

product respond to consumer search for these values?

6. What is the purpose of business? And of marketing?

What should it be?

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Source of Material:

CONSUMER BEHAVIOR Human Pursuit of Happiness in the World of Goods

(by Ban Mittal, Ph.D.) ISBN: 978-0-979-1336-3-3

(Paperback: 978-0-979-1336-4-0)

Open Mentis Publishers

Pow

erPo

int

by:

Ban

Mit

tal,

Ph

. D.

www.openmentis.com www.mycbbook.com

I welcome and will highly value your comments.

[email protected] [email protected]

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INTRODUCTION

Human Pursuit of Happiness in the World of Goods


understanding consumer behavior as a foundation for your marketing craft

Business