Consumer Behavior and Marketing Strategy - Coursework Example

Consumer behavior (Authors Name) (Institutional Affiliation) Consumer behavior The first step to consumer decision making is problem recognition. The root cause to making a decision starts with recognizing a particular problem by a consumer. The consumer has a need or a want that should be satisfied. A consumer can recognize that his current car is not of the new standards and thus he/she is compelled to consider buying a new one. The second step to consumer decision making process is information search. This involves the consumer looking for a product or services that effectively satisfies his/her wants. Most of the information received by the consumer is however through commercial sources such as newspapers, catalogs, media advertisement or through direct contact with the manufacture via mail. In this particular stage the consumer also analyses the strengths and weaknesses of the varieties of products available (Solomon 2009). Once the consumer decides on which product or service best satisfies his/her needs and wants the consumer goes to the next step which is to evaluate alternatives. The consumer’s main goal is to identify the best deal by comparing the various features and benefits of the different products. This may be based on a number of factors such as price, brands, colors and quality of the product or service, other factors such as preference may also influence their decisions. For consumers considering purchasing a car, price and prestige may be the most important factors. To most consumers however, perceived reliability of the car is core to their decision making. After careful evaluation of the alternatives the consumer then goes ahead to purchase the product or service. The consumer has already done extensive risk management and is sure of their decision. This stage however is influenced by factors such as the ability of the consumer to afford the car and sometimes the opinions of family and friends. The last step to the consumer decision making process is evaluating his overall decision referred to as the post-purchase stage. The consumer analyses if the product or service has indeed satisfied his/her need (Peter 2005). The assignment focuses on the assessment of consumer behavior on choice of an automotive. The assignment analyses the marketing strategies used by automotive companies such as segmentation, targeting and positioning. Automotives are categorized under high involvement products. A high involvement product is defined as a good with high capital value and is only purchased after very serious assessments and considerations. Market Segmentation Market segmentation can be defined as an approach that involves the division of the target market into different consumer segments. There are various methods that are available for segmenting the target groups. They include geographical, demographical, psychographic and behavioral segmentation. Psychographic segmentation stems from motivational research of consumers. This segmentation aims at relating the personality, character and buying behaviors of consumers. Psychographic segmentation analyses factors such as the opinions, activities, values and lifestyles of consumers in order to create various segments related to these factors. Behavioral segmentation divides consumers according to researched factors such as their level of information about the product, their attitude towards the product and also their usage rate and response to the product. Target processes Segmentation is important because it allows the marketer to sell to a specific group or otherwise referred to as a target audience. One of these target processes is referred to as differentiated target process. Differentiated strategy is selling your product or service to one or more market segments. This method allows the company to increase its customer base, sales and overall revenue. The advantage to this technique is that it helps expand the company’s sales reach (Levi 2007). Positioning Positioning is defined as implementation of the target strategy. A company can position itself as an operational excellent firm, a customer intimate firm or a technological effective firm. An operational excellent firm boasts strong competitive advantage in efficiency. The company is able to provide reliable services to its customers at more affordable costs than the competition. Customer intimate firms excel in service delivery. They are able to satisfy the customers’ needs exceptionally. Technological excellent companies on the other hand are able to provide products in the market that make use the best and latest technology. Consumer behavior Motivation Maslow (1943) in his study of motivation reiterated that individuals are motivated by the desire to achieve various needs. When a person has achieved a particular need, he/she seeks to achieve the next need. Maslow identified five important motivational needs that are divided into two main parts which are the basic needs and the growth needs. The basic needs include; psychological needs, safety needs, love and esteem. These needs are considered to highly motivate individuals when they are not fulfilled. Maslow stated that these needs should be sufficiently met before an individual is able to advance to higher levels of needs. The urge to satisfy these needs are affected by time. The longer the individual is deprived of these needs the stronger his/her desire to achieve the need grows. Once an individual has been able to sufficiently satisfy these basic needs he/she is now able to advance to the highest level of motivational need which is self-actualization. According to Maslow he noted that self-actualization was the most important and highest level of motivational need. Most individuals’ main aspiration is personal growth and self-fulfillment. This need is strongly associated with the individual desire to become and accomplish his/her full potential. Self-actualization has thus resulted to the specialization of careers for example some people are drawn by the need to become great sportsmen while others are driven by the need to become great scholars. At the bottom of Maslow’s hierarchal needs pyramid are the psychological needs. These are the physical conditions required for human survival they include air, water and food. Successful satisfaction of these needs ignite the desire for safety needs. Individuals desire physical, health and economic safety. After achieving these needs the individual is thus attracted by the need for love and belonging. Individuals have the need to have friendships, intimate relationships and family. Self-esteem follows suit after an individual successfully meets his/her psychological, safety and love and belonging needs. Self-esteem can simply be defined as the need by individuals to feel valued and respected by their peers. This need develops the desire for people to engage in different professions and hobbies all with an aim to create attention to them and also be recognized. The trio of needs theory was developed after Maslow’s theory and it assess the effects of individuals needs for achievement, power and affiliation under a managerial point of view. The theory states that people who are motivated by the need for achievement usually master a profession or situation. These individuals are motivated by overall accomplishments and are thus result oriented and tend to be shy of high risk and low risk situations. Individuals with need for affiliation on the other hand, are more focused on creating and maintaining social relations. They have a need to be loved and acknowledged in the society. The need for power unlike affiliation and achievement is a motivational need that is related to an individuals’ desire to influence others. Individuals who are motivated by power are attracted by work places that are keen on influence. Such individuals focus on prestige and personal status. Marketers can use Maslow hierarchy of needs and trio needs to influence consumer behavior in purchasing (Belch 2007). In relation to this study, a marketer can convince customer to buy a car by appealing to his/her need for safety and security. The marketer does this by convincing the customer that the car is reliable and safe for his family. A marketer can also appeal to the customer’s need for self-esteem by indicating that the car will increase his/her recognition amongst his/her friends. Personality The big five personality traits are used to describe the personality traits of individuals. These personality traits include intellect which is the level of an individuals’ creativity, conscientiousness which is the level of work ethic and organization, extraversion which is a persons’ level of sociability, agreeableness which is the level of friendliness and emotional stability which is the level of calmness. Intellect trait can be defined as an individuals’ general appreciation of art, unusual ideas and a variety of experiences. Individuals who are open to these factors have high levels of intellectual curiosity. They are open to trying new experiences, culture and largely interested in art and poetry. This is the reason why a company like Toyota uses this strategy. Toyota has a huge market scope and targets nearly every type of customer in the market in order to have competitive advantage over other automotive companies. Toyota developed the four wheel drive trucks and SUV’s for people who live in areas with poor roads and the Prius for customers who are concerned about the environment Conscientiousness is the ability of individuals to be able to aim for high achievements standards and to be self disciplined. This trait is associated with the ability of people to regulate and control their impulses. For example Hyundai used this personality trait to increase its profits and strengthen their brand. They realized that most individuals no longer focused on gas prices. Hyundai discovered that people were more concerned about losing their jobs and this limited them from purchasing a car. Hyundai thus created a segment of people concerned about job security and developed marketing strategies to target this people. Extraversion is a trait that is associated with individuals who are friendly and enjoy interacting with people. They are very enthusiastic individuals and are usually very active in group activities. Agreeableness reflects an individuals’ level of friendliness. Agreeable persons advocate for social harmony through being kind and trustworthy. They value good social relations with others and are very optimistic persons. People who possess the agreeable trait possess good leadership traits as well. Emotional stability is the capability of an individual to avoid situations of low tolerance and aversive stimuli such as anger, anxiety or depression. Individuals who are emotionally unstable are more vulnerable to stressful situations. Self-concept An individuals’ self-concept can be described as his/her perception of himself/herself. This perception includes both physical and psychological perception. The study of self-concept has been used to study how individuals view themselves and the influence of this on their consumer behavior. Self concept can be assessed in four different forms. The first form is self-assessment which involves a person evaluating his behavior according to the norms of the society. A person assesses himself/herself according to what is considered right or wrong. The second form of assessment is self evaluation which involves an individual defining himself/herself according to opinions and views from other people. This largely depends on the relationship between the two people. The assessment thus has great impact if the other individual has great interest in the person he/she is assessing. The third form of assessment is referred to as social comparison. This states that an individual evaluates himself in comparison with others. The individual defines himself according to his/her status in the society. The fourth form of assessment is through influence search or trend. This argues that individuals develop self concepts in relation to their aspirations for influence and recognition. Consumers’ perceptions of themselves greatly influence their purchasing behaviors. The greatest influencing factor is the ideal self-concept. This is defined as the consumers’ perception of what he/she would like to be. The consumer thus is attracted to products and services that relate to his/her future self-image. Self-concept has been used in markets to segment markets according to their self-image. For example automotive companies develop luxury cars to appeal to individuals who value prestige. Perception Perception is the basis through which individuals act. The element of perceptions includes sensation. Sensation is defined as an individuals’ sensory organs response to stimuli. Such stimuli may take the form of products, advertisements or brand names. The main objective of perception is to create awareness of the surrounding while the main goal of sensation is to detect stimuli in the surrounding (Carlson 2010). The customers use their sensory receptors to see, hear, smell and feel when they are subjected to stimuli. Perceptional selection can be defined as the subconscious selection of aspects of the environment by an individual. Individuals only respond to a small part of the stimuli in their environment. An individual may look at some things and ignore others subconsciously. The selection of stimuli depends on the consumer’s previous experience with the stimuli and the motives of the individual at that time. Perceptual organization can be defined as the tendency of people to organize their perceptions into groups. They organize their perceptions into figure and ground relationships which are influenced by their experience with the element. Grouping of stimuli helps the individual to easily recall and remember certain stimuli. Marketers use grouping to their advantage to associate their products with certain meanings. Individuals also use perceptional organization to have closure on stimuli which they consider incomplete. Perceptional interpretation is applied by individuals with an aim of sorting and understanding the ambiguous nature of stimuli. Individuals are normally subjected to a number of influences that distort their perception of stimuli. These factors may be physical appearance, first impressions and stereotypes. Perception greatly influences the buying behavior of consumers. Marketers can change the perception of consumers by properly planning their marketing activities. These marketing activities should present the product in the best possible way this is due to the fact that customers integrate all the information about a company to form a perception about the products they offer. Consumer imagery Consumer behavior is influenced by how they perceive images. These images may involve their own self image and product positioning. Self image is defined as the way individuals perceive themselves. Individual use certain traits such as habits, their possessions and even their relationships and behaviors to define themselves. Each individual considers himself as unique and thus they purchase products that relate to their self-image. Product positioning is also another factor that influences consumer behavior. Perception of a product by a customer is more important than what the product is actually is. Successful product positioning is based on the consumers’ reality and familiarity of what it is. There are various positioning strategies that can be used include competitor-based positioning, umbrella positioning and value-based positioning. Competitor-based positioning involves the choosing a category and finding a point of difference. The category is used to identify other similar brands in the market that are providing the same services and offering the same benefits, the point of difference is then used to identify the qualities of the brand that make it unique and superior to the other brands. Umbrella positioning is characterized by products possessing and associating the same brand name. The products are grouped together under one major brand and marketed together by the brand. This positioning is advantageous in launching new products with the intention of making them acceptable in the market due to the already acceptable nature of the brand image (Kapferer 2008). Value-based positioning is focused on the consumer. It involves positioning your product according to the values and benefits the product offers the consumers. Value-based is supported by the fact that consumers generally purchase products from companies that are reliable and those that understand their needs. An example of this is Hyundai who have positioned themselves in terms of value against Japanese cars. Learning There are two approaches to understanding learning; the behavioral approach and the cognitive approach. Behavioral approach argues that learning is a response to the events happening around an individuals’ external environment. Cognitive approach on the on the hand states that learning is deliberate and is a result of an individuals’ conscious activities. Cognitive learning is focused on the gathering and processing of information. It also involves storing the message in an individuals’ memory where it is readily retrievable. Marketers thus constantly update their consumers about the availability of new brands. For example car manufacturing companies constantly update their consumers about new feature in their cars. They achieve this through running constant advertisements in the media. Multi-attribute Attitudes models There are models that have been developed to explain consumer attitudes. One such model is the Fishbein model (1967) that was designed to explain individual attitude formation. The intention of the model is to assess the consumers’ attitude towards certain objects in the market place and to determine the various attributes that are related to these objects. This model is used to understand and assess the role of attitudes in consumer behavior. The model is basically comprised of three elements which include beliefs, weights and attitudes. Beliefs are described as a measure of an individual’s attitude weights on the other hand is an evaluation of the importance of a particular attribute. This model is basically used measure the overall attitudes of individuals. The main goal of the Fishbein model is to reduce the overall attributes in a quantifiable score (Oskamp 2005). Marketers can use this model to help determine which attitudes are more appealing to their customers. References  Carlson, Neil R. (2010) Psychology: the Science of Behaviour. Toronto: Pearson Education Canada.  Kapferer, Jean-Noël (2008). The New Strategic Brand Management: Creating and Sustaining Brand Equity Long Term. Kogan Page Publishers. Belch, G.E (2004) Advertising and promotion: An Integrated Marketing Communications Perspective, McGraw-Hill, New York Levi, K. (2007) "Differentiate or Diminish: The Art and Necessity of Business Positioning",) Loudon, D.L. and Bitta A.J. Della, (2002) Consumer Behavior, Fourth Edition, Tata McGraw-Hill, New Delhi. Kotler P., and Keller K.L (2009). Marketing Management, Pearson. Peter, P.J. and Olson, J.C. (2005), Consumer Behavior and Marketing Strategy, Seventh edition, McGraw-Hill Higher Education. Schiffman, L.G. and Kanuk, L.L. (2004), Consumer Behavior, Eight Edition, Prentice Hall, India. Wells W.D. and Prensky, D.(2006), Consumer Behavior, 1996, John Wiley & sons, Inc. Oskamp, S. & Schultz, W.(2005). Attitudes and opinions, Lawrence Erlbaum Associates Solomon, M, (2009). Consumer behavior buying, having, and being (8th ed.). Pearson Prentice Hall Read More