consumer behavior - a lesson
75Q1: a) “A family acts as an informal buying centre when family members participate in decision making? Explain.
Ans: there are typically six roles within any buying center. They are:
- Initiator who suggests purchasing a product or service.
- Influencers who try to affect the outcome decision with their opinions.
- Deciders who have the final decision.
- Buyers who are responsible for the contract.
- End users of the item being purchased.
- Gatekeepers who control the flow of information.
1. Influencers: Those family members who provide information and advice and thus influence the purchase.
The housewife tells her family about the new eatery that has opened in the neighborhood and her favorable description about it influences her husband and teenaged children to also patronize the restaurant. Family member(s) who provide information to other members about a product or service.
2. Gatekeepers: Those family members who control the flow of information about a product/service thus influencing the decisions of other family members. The teenaged son who wants a racing bicycle, may withhold from his father much of the relevant information on all brands except the one that he fancies, thereby influencing his father’s decision in favour of his preferred brand. Family member(s) who control the flow of information about a product or service into the family.
3. Deciders: Family members who have the power to unilaterally or jointly decide whether or not to buy a product or service. The husband and wife may jointly decide about the purchase of a new refrigerator. Family member(s) with the power to determine unilaterally or jointly whether to shop for, purchase, use, consume, or dispose of a specific product or service.
4. Buyers: Those family members who actually buy a particular product or service. A housewife may be the person who actually buys all the foodstuffs, rations and toiletries, which are consumed by all the family members. Family member(s) who make the actual purchase of a particular product or service.
5. Preparers: Those family members who transform or prepare the product into the form in which it is actually consumed. The housewife may prepare the family meal using raw vegetables, lentils, spices, oil and other ingredients. Family member(s) who transform the product into a form suitable for consumption by other family members.
6. Users: Those family members who use or consume a particular product or service. All family members may use the car, watch the television, and listen to the stereo music system Family member(s) who use or consume a particular product or service.
7. Maintainers: Family member(s) who service or repair the product so that it will provide continued satisfaction.
8. Disposers: Family member(s) who initiate or carry out the disposal or discontinuation of a particular product or service. The number and identity
b) Briefly explain reference group and ways in which they influence buyer behavior.
Ans: Reference Group
A group with which the customer identifies in some way, and whose opinions and experiences influence the customer's behavior. For example, a sports fan might buy a brand of equipment used by a favorite team
1. Aspiration Group - a sub-category of a reference group, consisting of individuals (not necessarily known personally) with whom a person desires to be associated. Like a boy associate himself with actor and buys the brands endorsed by the actor.
2. Normative reference group is that group in which the consumer had direct relation or face to face relation and influence on the consumer buying decision and behavior.
For example, family and friends etc. The members of the family are always in interaction with the consumer and they give different ideas and suggestions or advice to the consumer to buy a specific product or brand. And thus they influence the consumer.
3: Comparative reference group:
Comparative reference group is that group in which the consumer has indirect relation and less face to face interaction, such type of groups attract the consumer and the consumer gradually start to adopt the life style of the personalities lying in the comparative reference group..
Q 2: As a brand manager for Allen Solly’s women wear, what segmentation strategy would you recommend?
Ans: In September 2002, leading Indian apparel company, Madura Garments launched a line of readymade women's western wear under the brand name 'Allen Solly Women's Wear.' The launch was backed by advertisements in the national print and outdoor media.
The case examines the changing dynamics of the women's wear market in India during the 1990s and early-2000s. Changes in India's cultural values and social system, and the impact of these changes on the dressing styles of Indian women are explored in detail. Madura Garment's decision to enter the readymade women's Western wear segment is examined in detail in light of the above changes. The case discusses the strategies adopted by the company in terms of marketing research, product design, retailing and promotion. The case also provides information about other players in the women's Western wear market in India and takes a look at the market's future prospects
The move attracted attention for two reasons. First, this was the first-ever nationwide exercise by any company to offer readymade Western wear for women in India on this large a scale.
Second, Madura seemed to have taken a risk by trying to extend its hitherto 'exclusively for men' brand, Allen Solly, to the women's segment
The nationwide launch was undertaken following the brand's impressive performance during the test-marketing phase in the city of Bangalore (Karnataka) in December 2001. Through Allen Solly Women's Wear, Madura formally extended the concept of Friday Dressing to women all over the country.
Q 3: TNS undertook a study to understand the new car buyers in India. The study revealed a relationship between self image and product’s image. How would you explain this phenomenon?
Ans: TNS is a leading global provider of market information. We collect, analyze, and interpret information to help our clients better understand the needs and wants of their customers. We provide research, advice, and insight on market segmentation, advertising and communications, new product
development, brand performance, and stakeholder management. We are also one of the leading providers of social and political polling.
From our global network, which spans 70 countries, we provide local expertise and knowledge, together with internationally consistent information and analysis to multi-national organizations.
The key drivers for the six need segments in India are summarized below:
Potency buyers are motivated by a need to attract opposite sex and feel powerful; brand image of trendy and innovative appeals to this group.
Utility buyers seek a need for basic transportation and care for family; Value for money and cost of ownership are the benefits that these buyers associate with.
Prestige buyers are motivated by a need for prestige, indulge self, and exclusivity; They are least price sensitive and desirous of latest/ futuristic features in cars
Adventure buyers seek fun & adventure and to increase popularity; SUV finds preference for these buyers who relate to their cars as “lover”.
Status buyers want to show-off success and attract attention; Superior craftsmanship and best technology are imagery issues that this group relates to.
Liberation is the smallest of the six need segments – these buyers seek increased freedom and latest technology; safety consciousness is relatively higher among them.
Hyundai and Maruti: At a rational-level, both these makes finds similarities on some of the rational brand drivers such as good fuel economy, easy to maintain, practical cars, and good after-sales service coverage. However, Hyundai’s persona is more expressive, while Maruti’s is more protective. For example, increase popularity and show-off success are stronger motivations for Hyundai, while basic transportation and fit-in socially is higher for Maruti. Consequently, Hyundai finds a relatively better “fit” with adventure and potency as compared to utility and status for Maruti.
Honda and Toyota: Superior craftsmanship is a key similarity for both these brands at a rational-level. However, Honda’s positioning is closer to the individual oriented zone of self-assertion – reflected in one of its key motive of “feel powerful”. Toyota, in comparison, falls more on the expressive and affiliative side with motives like “feel young” and “for adventure and fun”.
Q 4: What are the different stages in the organizational buying decision cycle? And also discuss the roles of organizational members in the decision making process?ns: Some of the characteristics of Organizational Buyers are:
1. Consumer market is a huge market in millions of consumers where organizational buyers are limited in number for most of the products.
2. The purchases are in large quantities.
3. Close relationships and service are required.
4. Demand is derived from the production and sales of buyers.
5. Demand fluctuations are high as purchases from business buyers magnify fluctuation in demand for their products.
6. The organizational buyers are trained professionals in purchasing.
7. Several persons in organization influence purchase.
8. Lot of buying occurs in direct dealing with manufacturers.
Organizational Buying Situations
Straight rebuy
In this buying situation, only purchasing department is involved. That get an information from inventory control department or section to reorder the material or item and they seek quotations from vendors in an approved list.
Modified rebuy
In this buying situation, there is a modification to the specifications of the product or specifications related to delivery. Executives apart from the purchasing department are involved in the buying decisions. The company is looking for additional suppliers or is ready to modify the approved vendors list based on the technical capabilities and delivery capabilities.
New task buy
In this situation, the buyer is buying the product for the first time. As the cost of the product or consumption value becomes higher, more number of executives are involved in the process. The stages of awareness, interest, evaluation, trial, and adoption will be there for the products of each potential supplier. Only the products which pass all the stages will be on the approved list and price competition will follow subsequently.
Systems buy
Systems buying is a process in which the organization gives a single order to a single organization for supplying a full system. The buying organization knows that no single party is producing all the units in the system. But it wants the system seller to engineer the system, procure the units from various vendors and assemble, fabricate or construct the system.
The roles of organizational members in the decision making process can be understood as buying centers in the Business Buying Process
Users The persons who use the item. Say for safety gloves the operators.
Initiators The persons who request the purchase. The safety officer may initiate the request for the purchase.
Influencers Persons who held define specifications. In this case of safety gloves, the safety officer may himself define specifications. If an industrial engineer is in the organization, he may also be consulted. There can different gloves for different working situations and industrial engineer may be more aware of specific requirements due to his special nature of work - human effort engineering.
Buyers They are the people who actually do the buying transaction.
Gatekeepers They control access to personnel in a company. The receptionist, the secretaries etc.
Deciders People who decide on product requirements and suppliers. It is the final approval for product specifications and suppliers' list.
Approvers Persons who approve the purchase. In the case of safety gloves, the personal manager may have the power to approve.
Q 5: a) Briefly explain sensory perception and factors affecting it. How do the consumers interpret their own perceptions about the products?
Ans: The physical systems that can be related in some crude ways to human senses. Touch, sight, hearing, taste, etc. the perception achieved through these senses are called sensory perception.
Whereas Joy is not a physical sensation but an emotion.
Physical pain or pleasure can be thought of as merely genetic programming built around the physical signals that our sense organs transmit. If bitter things generally provided nourishment, and sweet things were poisons, humans and other animals long ago would have developed a liking for bitter tastes and an avoidance of sweets. The pleasure associated with mating is built in too, to encourage reproduction. Although we find freezing water extremely unpleasant, it is unlikely that fish living in Arctic waters are in a constant state of pain or discomfort. The senses generally provide the means for an organism to achieve survival and avoid damage or death, and the "good" or "bad" associated with certain sensations are instinctual to a large extent.
b) Analyze the ambience of “Pizza Hut” by focusing on its visual features (interior, lighting, arrangement), auditory (type and loudness of music) features, olfactory (food aromas) features and tactile (tablecloths, napkins) features. How are customers’ sensory perceptions likely to affect their overall image of the restaurant?
Ans: a chain restaurant must balance its dual identity as a chain restaurant and as a local restaurant. This duality affects the customers as well because of the deviations in the customer’s perception of, in this case, Pizza Hut as a restaurant or a fast food establishment.
All the restaurants in the UK are required to have music in the background and the internal decor also varies. However, most of the decor relate to pizzas and the colors blend with the Pizza Hut colors of red, black, yellow and green. These are primary bright colors that do not offer any sense of relaxation in the restaurant. Some of the restaurants serve their pizzas on the baking tray to show that they are straight from the oven while others serve them on wooden pallets. A setback for most of the restaurants is the crowded seating arrangements but it could be obviously deduced from the whole set-up that it is not a comfortable place to ‘sit and relax’, but rather to ‘eat and go’. An effective tool employed by the PizzaHut UK restaurants is the usual salad buffet and other starters like the hot barbeque wings that are used to kill the waiting times.
Q 6: Explain the process through which a new product moves from initial introduction to regular purchase and use?
Ans: Let us discuss the different stages in product life cycle.
Introduction stage: In this stage a product is launched in the market. The marketer has to make effort for
Creating product awareness in the market if it is leader
Induce trial of the product
Secure space in the outlet shelf.
Where, I: costs are high.
II: low sales volume
III: little or no competition
IV: no existing demand for the product
V: makes no money at this stage
2. Growth stage: This stage experiences rapid increase in sales volume where competition begins to increase, opportunity for large scale production and profit.
Where, 1) public awareness increases
2) Increased competition leads to price decreases
3) Maturity stage
Most of the products are in maturity stage. In this stage
I: the marginal Costs are low as a result of production in scale
II: sales volume peaks and most of the market is covered.
III: There is increase in competitors entering the market
IV: prices fall due to impact of competing products
V: brand differentiation and feature diversification is emphasized to maintain or increase market share
4. Saturation and decline stage
In this stage the sales volume decline, price and profitability diminish.
The marketer develops concern for 1) Identifying Weak products and determining such marketing strategy so that it could be dropped profitably.
Maruti 800 is at decline stage.
Q 7: a) Discuss the different approaches to positioning strategy giving and example of your choice.
Ans: A number of positioning strategies might be employed in developing a promotional program. The 7 such strategies are discussed below:
POSITIONING BY PRODUCT ATTRIBUTES AND BENEFITS
Associating a product with an attribute, a product feature or a consumer feature. Sometimes a product can be positioned in terms of two or more attributes simultaneously. The price/ quality attribute dimension is commonly used for positioning the products.
A common approach is setting the brand apart from competitors on the basis of the specific characteristics or benefits offered. Sometimes a product may be positioned on more than one product benefit. Marketers attempt to identify salient attributes (those that are important to consumers and are the basis for making a purchase decision)
Consider the example of Ariel that offers a specific benefit of cleaning even the dirtiest of clothes because of the micro cleaning system in the product.
Colgate offers benefits of preventing cavity and fresh breath.
Promise, Balsara’s toothpaste, could break Colgate’s stronghold by being the first to claim that it contained clove, which differentiated it from the leader.
Nirma offered the benefit of low price over Hindustan Lever’s Surf to become a success.
Maruti Suzuki offers benefits of maximum fuel efficiency and safety over its competitors. This strategy helped it to get 60% of the Indian automobile market.
POSITIONING BY PRICE/ QUALITY
Marketers often use price/ quality characteristics to position their brands. One way they do it is with ads that reflect the image of a high-quality brand where cost, while not irrelevant, is considered secondary to the quality benefits derived from using the brand. Premium brands positioned at the high end of the market use this approach to positioning.
Another way to use price/ quality characteristics for positioning is to focus on the quality or value offered by the brand at a very competitive price. Although price is an important consideration, the product quality must be comparable to, or even better than, competing brands for the positioning strategy to be effective.
Parle Bisleri – “Bada Bisleri, same price” ad campaign.
POSITIONING BY USE OR APPLICATION
Another way is to communicate a specific image or position for a brand is to associate it with a specific use or application.
Surf Excel is positioned as stain remover ‘ Surf Excel hena!’
Also, Clinic All Clear – “Dare to wear Black”.
POSITIONING BY PRODUCT CLASS
Often the competition for a particular product comes from outside the product class. For example, airlines know that while they compete with other airlines, trains and buses are also viable alternatives. Manufacturers of music CDs must compete with the cassettes industry. The product is positioned against others that, while not exactly the same, provide the same class of benefits.
POSITIONING BY PRODUCT USER
Positioning a product by associating it with a particular user or group of users is yet another approach.
Motography Motorola Mobile Ad.n this ad the persona of the user of the product is been positioned.
POSITIONING BY COMPETITOR
Competitors may be as important to positioning strategy as a firm’s own product or services. In today’s market, an effective positioning strategy for a product or brand may focus on specific competitors. This approach is similar to positioning by product class, although in this case the competition is within the same product category.
Onida was positioned against the giants in the television industry through this strategy, ONIDA colour TV was launched with the message that all others were clones and only Onida was the leader. “neighbour’s Envy, Owners Pride”.
POSITIONING BY CULTURAL SYMBOLS
An additional positioning strategy where in the cultural symbols are used to differentiate the brands. Examples would be Humara Bajaj, Tata Tea, Ronald McDonald. Each of these symbols has successfully differentiated the product it represents from competitors
b) Explain how does Fishbien model relate directly consumer beliefs with affective response?
Ans: Fishbein's Attitude
Attitudes are some of the most misunderstood aspects of our personalities. How we develop our attitudes and what impact they have on our behavior is equally a mystery.
Fishbein and Ajzen found two problems with the traditional views of attitude and communication; first the term attitude has been defined too generally. The traditional view did not differentiate between attitude, belief, subjective norms, behavioral intention and behavior. Fishbein and Ajzen felt that these key terms should be separated because each had a separate, but key role in both the prediction of actions. They have been defined too "loosely" and the results have been inconsistent and often contradictory with each other The second problem Fishbein found with the traditional view is that the researchers seemed to ignore the receiver. He felt that they were only looking at the message and were treating the receiver as a "passive recipient of information" and consequently gave the credit of attitude almost entirely to the quality of the message and the number of the arguments . These problems needed to be corrected.
Fishbein's attitude theories give us a basis to understand attitude and predict behavior.. His theories also help us to understand the development and formation of attitudes and belief, helping us find the most effective modes of persuasion and motivation; if we understand how attitudes are formed we are better equipped to mold them.
Fishbein's views on attitude can be broken down into three theories.
First we have his information and integration theory, which focuses on how we accumulate and organize information. According to this theory all information has the potential to affect attitude based on two variables valence and weight Valence is how the information compares to our attitude. All statements have a positive or negative valence based on whether or not we agree with them. A statement with a positive valence is something we already agree with and a statement with a negative valence is something we already disagree with. The effect information has on our attitude is also determined by the weight it has. Statements with a lighter weight regardless of their valence are not going to have much of an impact on our attitude. A statement that we believe has a great deal of weight is going to have a more significant impact on our attitude regardless of its valence. This theory also holds that most of the time one statement regardless of the weight we assign it will not have a significant impact on our attitude because our attitudes usually consist of a number of ideas that will counteract the new information.
Understanding Attitudes and Predicting Social Behavior Fishbein uses a woman's choice to use birth control pills to illustrate this. He used five consequences of using birth control pills rated them with either a positive of negative valence and then rated each with a weight. The valance was rated with Table A. The respondent was asked to rank possible consequences based on how favorable she thought they were. The respondent was then asked to rank how likely she thought each consequence would be.
According to this theory information can have three effects on attitude change: first information can change the weight of a particular belief, second information can effect the direction or valence of a particular belief and third information can add new beliefs (Littlejohn 2002).
The third theory has to do with how attitudes from the first two theories influence behavior; this theory is called Theory of Reasoned Action. In this theory Fishbein and Ajzen argue that "behavior results in part from intentions and from
