BusinessEssentialsTwelfthEditionChapter11MarketingProcessesandConsumerBehaviorCopyright?2019,2016,2013PearsonEducation,Inc.AllRightsReserved.IntroductionInthischapterwediscussthesemarketingbasicslikethemarketingplanandcomponentsofthemarketingmix,aswellastargetmarketingandmarketsegmentationexplorekeyfactorsthatinfluenceconsumerandorganizationalbuyingprocessesLearningObjectives(1of2)Explaintheconceptofmarketingandidentifythefiveforcesthatconstitutetheexternalmarketingenvironment.Explainthepurposeofamarketingplanandidentifyitsmaincomponents.Explainmarketsegmentationandhowitisusedintargetmarketing.Discussthepurposeofmarketingresearch,andcomparethefourmarketingresearchmethods.LearningObjectives(2of2)Describetheconsumerbuyingprocessandthekeyfactorsthatinfluencethatprocess.Discussthefourcategoriesoforganizationalmarkets,andthecharacteristicsofbusiness-to-business(B2B)buyingbehavior.Discussthemarketingmixasitappliestosmallbusiness.WhatIsMarketing?Marketingorganizationalfunctionandasetofprocessesforcreating,communicating,anddeliveringvaluetocustomers,andformanagingcustomerrelationshipsinwaysthatbenefittheorganizationanditsstakeholdersDeliveringValue(1of2)Valuerelativecomparisonofaproduct’sbenefitsversusitscostsDeliveringValue(2of2)Acompanymay:developanentirelynewproductthatperformsbetterthanexistingproductskeepastoreopenlongerhoursduringabusyseasonofferpricereductionsofferinformationthatexplainshowaproductcanbeusedinnewwaysValueandUtilityUtilityabilityofaproducttosatisfyahumanwantorneedFormTimePlacePossessionGoods,Services,andIdeasConsumerGoodsphysicalproductspurchasedbyconsumersforpersonaluseIndustrialGoodsphysicalproductspurchasedbycompaniestoproduceotherproductsServicesproductshavingnonphysicalfeatures,suchasinformation,expertise,oranactivitythatcanbepurchasedRelationshipMarketingandCustomerRelationshipManagementRelationshipMarketingmarketingstrategythatemphasizesbuildinglastingrelationshipswithcustomersandsuppliersCustomerRelationshipManagement(CRM)organizedmethodsthatafirmusestobuildbetterinformationconnectionswithclients,sothatstrongercompany-clientrelationshipsaredevelopedDataWarehousingthecollection,storage,andretrievalofdatainelectronicfilesTheExternalMarketingEnvironmentTheMarketingEnvironment(1of2)Political-LegalEnvironmenttherelationshipbetweenbusinessandgovernment,usuallyintheformofgovernmentregulationofbusinessSocioculturalEnvironmentthecustoms,mores,values,anddemographiccharacteristicsofthesocietyinwhichanorganizationfunctionsTheMarketingEnvironment(2of2)TechnologicalEnvironmentallthewaysbywhichfirmscreatevaluefortheirconstituentsEconomicEnvironmentrelevantconditionsthatexistintheeconomicsysteminwhichacompanyoperatesCompetitiveEnvironmentSubstituteProductproductthatisdissimilarfromthoseofcompetitors,butthatcanfulfillthesameneedBrandCompetitioncompetitivemarketingthatappealstoconsumerperceptionsofbenefitsofproductsofferedbyparticularcompaniesInternationalCompetitioncompetitivemarketingofdomesticproductsagainstforeignproductsStrategy:TheMarketingMixMarketingPlandetailedstrategyforfocusingmarketingeffortsonconsumers’needsandwantsMarketingObjectivesthethingsmarketingintendstoaccomplishinitsmarketingplanMarketingManagermanagerwhoplansandimplementsthemarketingactivitiesthatresultinthetransferofproductsfromproducertoconsumerComponentsoftheMarketingPlanStrategy:TheMarketingMix(1of2)Productgood,service,orideathatismarketedtofillconsumers’needsandwantsProductDifferentiationcreationofaproductfeatureorproductimagethatdiffersenoughfromexistingproductstoattractcustomersStrategy:TheMarketingMix(2of2)PricingprocessofdeterminingthebestpriceatwhichtosellaproductPlace(Distribution)partofthemarketingmixconcernedwithgettingproductsfromproducerstoconsumersPromotionaspectofthemarketingmixconcernedwiththemosteffectivetechniquesforcommunicatinginformationaboutproductsPromotion(1of2)Advertisinganyformofpaidnon-personalcommunicationusedbyanidentifiedsponsortopersuadeorinformpotentialbuyersaboutaproductPersonalSellingperson-topersonsalesPromotion(2of2)SalesPromotiondirectinducementssuchaspremiums,coupons,andpackageinsertstotemptconsumerstobuyproductsPublicRelationscommunicationeffortsdirectedatbuildinggoodwillandfavorableattitudesinthemindsofthepublictowardtheorganizationanditsproductsIntegratedStrategyIntegratedMarketingStrategystrategythatblendstogethertheFourPsofmarketingtoensuretheircompatibilitywithoneanother,aswellaswiththecompany’snon-marketingactivitiesTargetMarketingandMarketSegmentation(1of2)TargetMarketgroupofpeoplewhohavesimilarwantsandneedsandcanbeexpectedtoshowinterestinthesameproductsMarketSegmentationprocessofdividingamarketintocategoriesofcustomertypes,or“segments”TargetMarketingandMarketSegmentation(2of2)ProductPositioningprocessoffixing,adapting,andcommunicatingthenatureofaproductIdentifyingMarketSegments(1of2)GeographicVariablesgeographicunitsthatmaybeconsideredindevelopingasegmentationstrategyGeographicSegmentationgeographicunits,fromcountriestoneighborhoods,thatmaybeconsideredinidentifyingdifferentmarketsegmentsinasegmentationstrategyIdentifyingMarketSegments(2of2)DemographicVariablescharacteristicsofpopulationsthatmaybeconsideredindevelopingasegmentationstrategyDemographicSegmentationasegmentationstrategythatusesdemographiccharacteristicstoidentifydifferentmarketsegmentsDemographicVariablesTable11.1DemographicVariablesAgeUnder5,5–11,12–19,20–34,35–49,50–64,65+EducationGradeschoolorless,somehighschool,graduatedhighschool,somecollege,collegedegree,advanceddegreeFamilyLifeCycleYoungsingle,youngmarriedwithoutchildren,youngmarriedwithchildren,oldermarriedwithchildrenunder18,oldermarriedwithoutchildrenunder18,oldersingle,otherFamilySize1,2–3,4–5,6+IncomeLessthan$15,000,$15,000–$24,999,$25,000–$50,000,$50,000–$100,000,$100,000–$200,000,morethan$200,000NationalityAfrican,American,Asian,British,EasternEuropean,French,German,Irish,Italian,LatinAmerican,MiddleEastern,ScandinavianRaceAmericanIndian,Asian,AfricanAmerican,CaucasianReligionBuddhist,Catholic,Hindu,Jewish,Muslim,ProtestantGenderMale,femaleIdentifyingMarketSegments(1of3)Geo-DemographicVariablescombinationofgeographicanddemographictraitsusedindevelopingasegmentationstrategyGeo-DemographicSegmentationusingacombinationofgeographicanddemographictraitsforidentifyingdifferentmarketsegmentsinasegmentationstrategyIdentifyingMarketSegments(2of3)PsychographicVariablesconsumercharacteristics,suchaslifestyles,opinions,interests,andattitudesthatmaybeconsideredindevelopingasegmentationstrategyPsychographicSegmentationasegmentationstrategythatusespsychographiccharacteristicstoidentifydifferentmarketsegmentsIdentifyingMarketSegments(3of3)BehavioralVariablesbehavioralpatternsdisplayedbygroupsofconsumersandthatareusedindevelopingasegmentationstrategyBehavioralSegmentationasegmentationstrategythatusesbehavioralvariablestoidentifydifferentmarketsegmentsMarketingResearch(1of2)MarketingResearchthestudyofwhatcustomersneedandwantandhowbesttomeetthoseneedsandwantsMarketingResearch(2of2)TheResearchProcessStudythecurrentsituationSelectaresearchmethodCollectdataAnalyzethedataPrepareareportResearchDataSecondaryDatadatathatarealreadyavailablefrompreviousresearchPrimaryDatanewdatathatarecollectedfromnewlyperformedresearchResearchMethods(1of2)ObservationresearchmethodthatobtainsdatabywatchingandrecordingconsumerbehaviorSurveyresearchmethodofcollectingconsumerdatausingquestionnaires,telephonecalls,andface-to-faceinterviewsResearchMethods(2of2)FocusGroupresearchmethodusingagroupofpeoplefromalargerpopulationwhoareaskedtheirattitudes,opinions,andbeliefsaboutaproductinanopendiscussionExperimentationresearchmethodusingasampleofpotentialconsumerstoobtainreactionstotestversionsofnewproductsorvariationsofexistingproductsUnderstandingConsumerBehavior(1of3)ConsumerBehaviorstudyofthedecisionprocessbywhichpeoplebuyandconsumeproductsPsychologicalInfluencesincludeanindividual’smotivations,perceptions,abilitytolearn,andattitudesthatmarketersusetostudybuyingbehaviorPersonalInfluencesincludelifestyle,personality,andeconomicstatusthatmarketersusetostudybuyingbehaviorUnderstandingConsumerBehavior(2of3)SocialInfluencesincludefamily,opinionleaders(peoplewhoseopinionsaresoughtbyothers),andsuchreferencegroupsasfriends,coworkers,andprofessionalassociatesthatmarketersusetostudybuyingbehaviorCulturalInfluencesincludeculture,subculture,andsocialclassinfluencesthatmarketersusetostudybuyingbehaviorUnderstandingConsumerBehavior(3of3)BrandLoyaltypatternofregularconsumerpurchasingbasedonsatisfactionwithaproduct’sperformanceTheConsumerBuyingProcess(1of2)EvokedSet(orConsiderationSet)groupofproductsconsumerswillconsiderbuyingasaresultofinformationsearchRationalMotivesreasonsforpurchasingaproductthatarebasedonalogicalevaluationofproductattributesEmotionalMotivesreasonsforpurchasingaproductthatarebasedonnonobjectivefactorsTheConsumerBuyingProcess(2of2)BusinessMarketing(1of2)ServicesCompaniesMarketfirmsengagedinthebusinessofprovidingservicestothepurchasingpublicIndustrialMarketorganizationalmarketconsistingoffirmsthatbuygoodsthatareeitherconvertedintoproductsorusedduringproductionResellerMarketorganizationalmarketconsistingofintermediariesthatbuyandresellfinishedgoodsB2BBuyingBehaviorIndustrialbuyersbuyinbulkorlargequantitiesB2BbuyersaretrainedinmethodsfornegotiatingpurchasetermsIndustrialbuyersarecompanyspecialistsinalineofitemsandareoftenexpertsabouttheproductstheybuyBusinessMarketing(2of2)InstitutionalMarketorganizationalmarketconsistingofsuchnongovernmentalbuyersofgoodsandservicesashospitals,churches,museums,andcharitableorganizationsSocialMediaandMarketing(1of2)SocialNetworkingnetworkofcommunicationsthatflowamongpeopleandorganizationsinteractingthroughanonlineplatformSocialNetworkingMediawebsitesoraccesschannels,suchasFacebook,Twitter,LinkedIn,andYouTube,towhichconsumersgoforinformationanddiscussionsSocialMediaandMarketing(2of2)ViralMarketingtypeofmarketingthatreliesontheInternettospreadinformationlikea“virus”frompersontopersonaboutproductsandideasCorporateBlogscommentsandopinionspublishedontheWebbyorforanorganizationtopromoteitsactivitiesTheInternationalMarketingMixInternationalProductssomeproductscanbesoldabroadwithvirtuallynochangesInternationalPricingmarketersmustconsiderthehighercostsoftransportingand