PrinciplesofMarketingNineteenthEditionChapter5ConsumerMarketsandBuyerBehaviorCopyright?2024,2021,2018PearsonEducation,Inc.AllRightsReservedLearningObjectives5.1Definetheconsumermarketandconstructasimplemodelofconsumerbuyerbehavior.5.2Explorethefourmajorfactorsthatinfluenceconsumerbuyerbehavior.5.3Understandthestagesinthebuyerdecisionprocessandthemajortypesofbuyingdecisionbehavior.5.4Describetheadoptionanddiffusionprocessfornewproducts. BeyondMeat:ChangingConsumerAttitudesandBehavior,OneBurgerataTimeChangingingrainedconsumerattitudesandbehaviorscanbedifficult.ButBeyondMeatisofftoagoodstartwithitsplant-basedmeatproducts.TheBeyondBurger“cookslikeabeefpatty.Itsizzles,itoozes.Andsizzle,weknow,iswhatsells.”davidebonaldo/ShutterstockLearningObjective1Definetheconsumermarketandconstructasimplemodelofconsumerbuyerbehavior.ConsumerMarketsandBuyerBehaviorConsumerbuyerbehavioristhebuyingbehavioroffinalconsumers—individualsandhouseholdsthatbuygoodsandservicesforpersonalconsumption.Consumermarketsaremadeupofalltheindividualsandhouseholdsthatbuyoracquiregoodsandservicesforpersonalconsumption.ModelofConsumerBehaviorFigure5.1AModelofBuyerBehaviorLearningObjective2Explorethefourmajorfactorsthatinfluenceconsumerbuyerbehavior.CharacteristicsAffectingConsumerBehavior(1of16)Figure5.2FactorsInfluencingConsumerBehaviorCharacteristicsAffectingConsumerBehavior(2of16)CulturalFactorsCultureisthesetofbasicvalues,perceptions,wants,andbehaviorslearnedbyamemberofsocietyfromfamilyandotherimportantinstitutions.CharacteristicsAffectingConsumerBehavior(3of16)CulturalFactorsSubculturesaregroupsofpeoplewithinaculturewithsharedvaluesystemsbasedoncommonlifeexperiencesandsituations.MarketingtoHispanicAmericanconsumers:SelectMcDonald’srestaurantsincommunitieswithdeepLatinroots—here,Miami’siconicLittleHavananeighborhood—launchedRitmoyColorMcDonald’s(RhythmandColorMcDonald’s)experiences,transforminglocalrestaurantsintovibrantexpressionsoftheirHispanicroots.JeffreyIsaacGreenberg2+/AlamyStockPhotoCharacteristicsAffectingConsumerBehavior(4of16)CulturalFactorsRealMarketing5.1:Micro-Influencers:SometimesSmallerIsBetterInsteadofpayingtopdollartoasmallgroupofmega-influencers,manybrandsnowarepartneringwithalargernumberofsmallermicro-influencerstogiveamoreauthentic,focused,andaffordablevoicetotheirbrand.DiegoCervo/ShutterstockCharacteristicsAffectingConsumerBehavior(5of16)GroupsandSocialNetworksReferencegroupsOpinionleadersWord-of-mouthinfluenceInfluencermarketingOnlinesocialnetworksTargetingBlackAmericanconsumers:P&G’s“MyBlackIsBeautiful”campaignaimstosparkconversationby,for,andaboutblackwomentoeffectpositivechange.ThecampaignhelpstobuildpositiverelationshipsbetweenP&Gbrandsandblackconsumers.TasiaWells/Stringer/GettyImagesCharacteristicsAffectingConsumerBehavior(6of16)SocialFactorsFamilyisthemostimportantconsumer-buyingorganizationinsociety.Role

andstatuscanbedefinedbyaperson’spositioninagroup.Embracingdiversity,equity,andinclusiveness:Respondingtorenewedcallsforracialequity,severalcompanieshaverenamed,repositioned,andreimagedwell-knownbutculturallyinsensitivebrands.Forexample,QuakerrebrandeditsAuntJemimapancakemixesandsyrupsasPearlMillingCompanyproducts,namedafterthesmallmillthatfirstproducedthepancakeproducts.MichaelNeelon(misc)/AlamyStockPhotoDiscussionQuestion(1of2)Howdosocialfactorsinfluenceabuyer’sbehavior?CharacteristicsAffectingConsumerBehavior(7of16)PersonalFactorsOccupationaffectsthegoodsandservicesboughtbyconsumers.AgeandLifeStageaffecttastesinfood,clothes,furniture,adrecreation.Economicsituationsincludetrendsinspending,personalincome,savings,interestrates.Appealingtooccupationsegments:MedicalapparelmakerFIGSsellsmodern,comfortable,andfunctionalscrubsmadewithitsproprietaryfabricsdirecttomedicalandhealthprofessionals.

FIGSCharacteristicsAffectingConsumerBehavior(8of16)PersonalFactorsLifestyleisaperson’spatternoflivingasexpressedinhisorherpsychographics.Personalityreferstotheuniquepsychologicalcharacteristicsthatdistinguishapersonorgroup.Lifestyles:ActionsportsfootwearandapparelmakerVanssellsmorethanjustproducts.Itsells“OfftheWall”lifestyleexperiences.snapshopped/ShutterstockCharacteristicsAffectingConsumerBehavior(9of16)Brandpersonality:Ford’smarket-leadingF-seriespickuptruckbrandispositionedontoughness—BuiltFordTough—conveyingquality,durability,andresilience.Chuckld.photos/AlamyStockPhoto;MichaelWels/AlamyStockPhotoCharacteristicsAffectingConsumerBehavior(10of16)PsychologicalFactorsMotivationPerceptionLearningBeliefsandattitudesThisclassicadfromtheAmericanAssociationofAdvertisingAgenciespokesfunatsubliminaladvertising.“So-called‘subliminaladvertising’simplydoesn’texist,”saysthead.“Overactiveimaginations,however,mostcertainlydo.”AmericanAssociationofAdvertisingAgenciesCharacteristicsAffectingConsumerBehavior(11of16)PsychologicalFactorsAmotive(ordrive)isaneedthatissufficientlypressingtodirectthepersontoseeksatisfactionoftheneed.Motivationresearchreferstoqualitativeresearchdesignedtoprobeconsumers’hidden,subconsciousmotivations.CharacteristicsAffectingConsumerBehavior(12of16)Figure5.3Maslow’sHierarchyofNeedsCharacteristicsAffectingConsumerBehavior(13of16)PsychologicalFactorsPerceptionistheprocessbywhichpeopleselect,organize,andinterpretinformationtoformameaningfulpictureoftheworld.PerceptualProcessesSelectiveattentionSelectivedistortionSelectiveretentionCharacteristicsAffectingConsumerBehavior(14of16)PsychologicalFactorsSelectiveattentionisthetendencyforpeopletoscreenoutmostoftheinformationtowhichtheyareexposed.Selectivedistortionisthetendencyforpeopletointerpretinformationinawaythatwillsupportwhattheyalreadybelieve.Selectiveretentionisthetendencytoremembergoodpointsmadeaboutabrandtheyfavorandforgetgoodpointsmadeaboutcompetingbrands.CharacteristicsAffectingConsumerBehavior(15of16)PsychologicalFactorsLearningisthechangeinanindividual’sbehaviorarisingfromexperienceandoccursthroughtheinterplayof:DrivesStimuliCuesResponsesReinforcementCharacteristicsAffectingConsumerBehavior(16of16)PsychologicalFactorsAbeliefisadescriptivethoughtthatapersonhasaboutsomethingbasedon:KnowledgeOpinionFaithAnattitudedescribesaperson’srelativelyconsistentevaluations,feelings,andtendenciestowardanobjectoridea.SPANX:ChangingtheWayWomenThinkabout“Shapewear”SPANXandfounderSaraBlakelyhavefundamentallychangedthewayconsumersthinkaboutclothingandtheirbodyshapes.It’snot“foundationwear”anymore.“Shapewearisthecanvasandclothesaretheart.”?WillVragovic/TampaBayTimes/ZUMAPRESS.com/AlamyLiveNewsStockPhotoLearningObjective3Understandthestagesinthebuyerdecisionprocessandthemajortypesofbuyingdecisionbehavior.Figure5.4BuyerDecisionProcessTypesofBuyingDecisionBehavior(1of2)ComplexbuyingbehaviorDissonance-reducingbuyingbehaviorHabitualbuyingbehaviorVariety-seekingbuyingbehaviorTypesofBuyingDecisionBehavior(2of2)Figure5.5FourTypesofBuyingBehaviorSource:AdaptedfromHenryAssael,ConsumerBehaviorandMarketingAction(Boston:KentPublishingCompany,1987),p.87.Usedwithpermissionoftheauthor.TheBuyerDecisionProcess(1of6)NeedRecognitionNeedrecognitionisthefirststageofthebuyerdecisionprocess,inwhichtheconsumerrecognizesaproblemorneedtriggeredby:InternalstimuliExternalstimuliTheBuyerDecisionProcess(2of6)InformationSearchInformationsearchisthestageofthebuyerdecisionprocessinwhichtheconsumerismotivatedtosearchformoreinformation.Sourcesofinformation:PersonalsourcesCommercialsourcesPublicsourcesExperientialsourcesTheBuyerDecisionProcess(3of6)EvaluationofAlternativesAlternativeevaluationisthestageofthebuyerdecisionprocessinwhichtheconsumerusesinformationtoevaluatealternativebrandsinthechoiceset.TheBuyerDecisionProcess(4of6)PurchaseDecisionPurchasedecisionisthebuyer’sdecisionaboutwhichbrandtopurchase.Thepurchaseintentionmaynotbethepurchasedecisiondueto:AttitudesofothersUnexpectedsituationalfactorsTheBuyerDecisionProcess(5of6)PostpurchaseBehaviorPostpurchasebehavioristhestageofthebuyerdecisionprocessinwhichconsumerstakefurtheractionafterpurchase,basedontheirsatisfactionordissatisfaction.TheBuyerDecisionProcess(6of6)PostpurchaseBehaviorCognitivedissonanceisbuyerdiscomfortcausedbypostpurchaseconflict.Postpurchasecustomersatisfaction:Postpurchasecustomersatisfactionisakeytobuildingprofitablecustomerrelationships.Mostmarketersgobeyondmerelymeetingthecustomerexpectations—theyaimtodelightcustomers.Dusit/ShutterstockTheCustomerJourneyCustomerjourney:thesumoftheongoingexperiencesconsumershavewithabrandthataffecttheirbuyingbehavior,engagement,andbrandadvocacyovertime.Thecustomerjourney:Byunderstandingthecustomerjourney,marketerscanworktocreatebrandexperiencesthatwillresultinpositivepurchasebehavior,engagement,andbrandadvocacyovertime.TylerNottley/ShutterstockDiscussionQuestion(2of2)Whymustmarketersunderstandthecustomerjourney?LearningObjective4Describetheadoptionanddiffusionprocessfornewproducts.TheBuyerDecisionProcessforNewProducts(1of3)Theadoptionprocessisthementalprocessanindividualgoesthroughfromfirstlearningaboutaninnovationtofinalregularuse.Stagesintheadoptionprocessinclude:AwarenessInterestEvaluationTrialAdoptionL’Oréalhasinvesteddeeplyintechnologiesthatmakeacustomer’sjourneyasfullandfulfillingaspossible.Theongoingaimis“toprovideservicestoourconsumerstohelpthemdiscover,try,buy,andexperienceourbrands.”Isaaack/ShutterstockTheBuyerDecisionProcessforNewProducts(2of3)IndividualDifferencesinInnovativenessInnovatorsEarlyAdoptersEarlyMainstreamLateMainstreamLaggingAdoptersTheBuyerDecisionProcessforNewProducts(3of3)Figure5.6AdopterCategoriesBasedonRelativeTimeofAdoptionofInnovationsAnalyzingandUsingMarketingInformationInfluenceofProductCharacteristicsonRateofAdoptionRelativeadvantageCompatibilityComplexityTrialabilityObservabilityCopyrightThisworkisprotectedbyUnitedStatescopyrightlawsandisprovidedsolelyfortheuseofinstructorsinteachingtheircoursesandassessingstudentlearning.Disseminationorsaleofanypartofthiswork(includingontheWorldWideWeb)willdestroytheintegrityoftheworkandisnotpermitted.Theworkandmaterialsfromitshouldneverbemadeavailabletostudentsexceptbyinstructorsusingtheaccompanyingtextintheirclasses.Allrecipientsofthisworkareexpectedtoabidebytheserestrictionsandtohonortheintendedpedagogicalpurposesandtheneedsofotherinstructorswhorelyonthesematerials.PrinciplesofMarketingNineteenthEditionChapter6BusinessMarketsandBusinessBuyerBehaviorCopyright?2024,2021,2018PearsonEducation,Inc.AllRightsReservedLearningObjectives6.1Definethebusinessmarketandexplainhowbusinessmarketsdifferfromconsumermarkets.6.2Identifythemajorfactorsthatinfluencebusinessbuyerbehavior.6.3Listanddefinethestepsinthebusinessbuyingdecisionprocess.6.4Discusshowonline,mobile,andsocialmediahavechangedbusiness-to-businessmarketing.6.5Comparetheinstitutionalandgovernmentmarketsandexplainhowinstitutionalandgovernmentbuyersmaketheirbuyingdecisions.LINKEDIN:ThePlacetoBeforB-to-BWithafast-growingmembershipofmorethan800millionbusinessprofessionals,LinkedInstandsoutasthego-toB-to-Bsocialsellingplatform.ItletsB-to-Bmarketers“markettowhomatters.”AlexandraPopova/ShutterstockConsumerMarketsandBuyerBehaviorBusinessbuyerbehaviorreferstothebuyingbehavioroftheorganizationsthatbuygoodsandservicesforuseintheproductionofotherproductsandservicesthataresold,rented,orsuppliedtoothers.Thebusinessbuyingprocessistheprocesswherebusinessbuyersdeterminewhichproductsandservicesareneededtopurchase,andthenfind,evaluate,andchooseamongalternativebrands.LearningObjective1Definethebusinessmarketandexplainhowbusinessmarketsdifferfromconsumermarkets.DiscussionActivity(1of2)Howdoesthebusinessmarketdifferfromtheconsumermarket?BusinessMarkets(1of3)MarketStructureandDemandFewerbutlargerbuyersDeriveddemandInelasticdemandFluctuatingdemandDeriveddemand:ToincreasedemandforGore-Texfabrics,Goremarketsdirectlytobuyersoftheoutdoorandathleticapparelbrandsmadeusingitsproductsandtechnologies.ThisadtellsrunnersthatGore-Textechnologyistestedand“GuaranteedtoKeepYouDry.”BothGoreanditspartnerbrandswin.CarolynJenkins/AlamyStockPhotoBusinessMarkets(2of3)NatureoftheBuyingUnitBusinessbuyersusuallyfacemorecomplexbuyingdecisionsthandoconsumerbuyers.Comparedwithconsumerpurchases,abusinesspurchaseusuallyinvolves:MoredecisionparticipantsMoreprofessionalpurchasingeffortMorebuyerandsellerinteractionBusinessMarkets(3of3)TypesofDecisionsandtheDecisionProcessBusinessbuyersusuallyfacemorecomplexbuyingdecisionsthanconsumerbuyers.Supplierdevelopmentisthesystematicdevelopmentofnetworksofsupplier-partnerstoensureanappropriateanddependablesupplyofproductsandmaterialsforuseinmakingproductsorresellingthemtoothers.Thebusinessbuyerdecisionprocess:Morethanjustsellingexpensiveairplanestoitsbusinesscustomers,Boeingwinsbuyers’businessbybuildingday-in,day-out,year-in,year-outproblem-solvingpartnershipswiththem.StephenBrashear/GettyImagesLearningObjective2Identifythemajorfactorsthatinfluencebusinessbuyerbehavior.BusinessBuyerBehavior(1of8)Figure6.1AModelofBusinessBuyerBehaviorBusinessBuyerBehavior(2of8)MajorTypesofBuyingSituationsStraightrebuyisabuyingsituationinwhichthebuyerroutinelyreorderssomethingwithoutanymodifications.Modifiedrebuyisabuyingsituationinwhichthebuyerwantstomodifyproductspecifications,prices,terms,orsuppliers.Newtaskisabuyingsituationinwhichthebuyerpurchasesaproductorserviceforthefirsttime.BusinessBuyerBehavior(3of8)MajorTypesofBuyingSituations(continued)Systemssellingisbuyingacompletesolutiontoaproblemfromasingleseller.RealMarketing6.1UPS:AStrategicLogisticsSolutionsPartnertoBusinessCustomersForitsbusinesscustomers,UPSdoesmorethanjustgetGrandma’sholidaypackagethereontime.Itpartnerscloselywiththemtodevelopfulllogisticssolutions.LukeSharrett/BloombergviaGettyImagesBusinessBuyerBehavior(4of8)ParticipantsintheBusinessBuyingProcessBuyingcenterconsistsofalltheindividualsandunitsthatplayaroleinthebusinesspurchasedecision-makingprocess.UsersInfluencersBuyersDecidersGatekeepersBuyingcenter:CardinalHealthdealswithawiderangeofbuyinginfluences,frompurchasingexecutivesandhospitaladministratorstosurgeonswhoactuallyusetheproducts.GroundPicture/ShutterstockBusinessBuyerBehavior(5of8)ParticipantsintheBusinessBuyingProcessUsersarethosethatwillusetheproductorservice.Influencershelpdefinespecificationsandprovideinformationforevaluatingalternatives.Buyershaveformalauthoritytoselectthesupplierandarrangetermsofpurchase.Decidershaveformalorinformalpowertoselectandapprovefinalsuppliers.Gatekeeperscontroltheflowofinformation.BusinessBuyerBehavior(6of8)ParticipantsintheBusinessBuyingProcessThebuyingcenterconceptpresentsamajormarketingchallengegiventhevariedgroupsinvolvedinthedecision.Whoparticipatesinthedecision?RelativeinfluenceondecisionbyvariousparticipantsEvaluationcriteriausedbyvariousparticipantsArethereInformalparticipantsinvolvedindecisionBusinessBuyerBehavior(7of8)MajorInfluencesonBusinessBuyersEmotionsplayanimportantroleinbusinessbuying.Peterbilt’smarketingstressesperformancefactorssuchasefficiency.ButitalsostressesmoreemotionalfactorssuchastherawbeautyofPeterbilttrucksandtheprideofowninganddrivingone.“ClassPays.”RomanKorotkov/ShutterstockBusinessBuyerBehavior(8of8)MajorInfluencesonBusinessBuyersFigure6.2MajorInfluencesonBusinessBuyerBehaviorLearningObjective3Listanddefinethestepsinthebusinessbuyingdecisionprocess.TheBusinessBuyerDecisionProcess(1of5)Figure6.3StagesoftheBusinessBuyerDecisionProcessTheBusinessBuyerDecisionProcess(2of5)Problemrecognitionoccurswhensomeoneinthecompanyrecognizesaproblemorneed.Internalstimuli—NeedfornewproductorproductionequipmentExternalstimuli—IdeafromatradeshoworadvertisingProblemrecognition:Salesforce’s“Blazeyourtrail”adsshowhowitsolvesproblemsforsomeofitshigh-profilecustomers,suchasUnileverandIntuit,suggestingthatitcandothesamefornewcustomers.davidtran07/123R

FTheBusinessBuyerDecisionProcess(3of5)Generalneeddescriptiondescribesthecharacteristicsandquantityoftheneededitem.Productspecificationdescribesthetechnicalcriteria.Valueanalysisisanapproachtocostreductionwherecomponentsarestudiedtodetermineiftheycanberedesigned,standardized,ormadewithlesscostlymethodsofproduction.TheBusinessBuyerDecisionProcess(4of5)Suppliersearchinvolvescompilingalistofqualifiedsupplierstofindthebestvendors.Proposalsolicitationistheprocessofrequestingproposalsfromqualifiedsuppliers.Supplierselectioniswhenthebuyingcentercreatesalistofdesiredsupplierattributesandnegotiateswithpreferredsuppliersforfavorabletermsandconditions.TheBusinessBuyerDecisionProcess(5of5)Order-routinespecificationsincludesthefinalorderwiththechosensupplierandlistsallofthespecificationsandtermsofthepurchase.Performancereviewinvolvesacritiqueofsupplierperformancetotheorder-routinespecifications.LearningObjective4Discusshowonline,mobile,andsocialmediahavechangedbusiness-to-businessmarketing.EngagingBusinessBuyerswithDigitalandSocialMarketing(1of3)E-ProcurementandOnlinePurchasingOnlinepurchasingCompany-buyingsitesExtranetsOnlineprocurementisstandardprocedureformostcompaniestoday,lettingbusinessmarketersconnectwithcustomersonlinetosellproductsandservices,providecustomersupportservices,andmaintainongoingcustomerrelationships.icetray/123R

FEngagingBusinessBuyerswithDigitalandSocialMarketing(2of3)E-ProcurementandOnlinePurchasingAdvantagesAccesstonewsuppliersLowerscostsSpeedsorderprocessinganddeliveryEnhancesinformationsharingImprovessalesFacilitatesserviceandsupportDisadvantagesErodesrelationshipsasbuyerssearchfornewsuppliersEngagingBusinessBuyerswithDigitalandSocialMarketing(3of3)B-to-Bdigitalandsocialmediamarketingisusingdigitalandsocialmediamarketingapproachestoengagebusinesscustomersandmanagecustomerrelationshipsanywhere,anytime.ContainershippinggiantMaerskLineengagesbusinesscustomersthroughaboatloadofdigitalandsocialmedia.“Thegoalistogetclosertoourcustomers.”rafapress/ShutterstockDiscussionActivity(2of2)Howhaveonline,mobile,andsocialmediachangedbusiness-to-businessmarketing?LearningObjective5Comparetheinstitutionalandgovernmentmarketsandexplainhowinstitutionalandgovernmentbuyersmaketheirbuyingdecisions.InstitutionalandGovernmentMarkets(1of2)Institutionalmarketsconsistofschools,hospitals,nursinghomes,andprisonsthatprovidegoodsandservicestopeopleintheircare.CharacteristicsLowbudgetsCaptivepatronsB-to-BBrandsonTikTok:SucceedingonToday’sHottestSocialMediaPlatformBusiness-to-businessmarketersareincreasinglyusingyouthful,fun,andquirkyTikTokvideostoconnecteffectivelywiththeirbusinesscustomers.kovop58/ShutterstockInstitutionalMarketsInstitutionalmarkets:KraftHeinzFoodservicehelpsinstitutionalfoodservicecustomersinanyofseveralindustriesfindcreativemealsolutionsusingitsbroadassortmentoffoodandcondimentbrands.Ithelpsthem“ElevateYourMenu.”CourtesyofTheKraftHeinzCompanyInstitutionalandGovernmentMarkets(2of2)Governmentmarketstendtofavordomesticsuppliers,requirethemtosubmitbids,andnormallyawardthecontracttothelowestbidder.AffectedbyenvironmentalfactorsNon-economicfactorsconsideredMinorityfirmsDepressedfirmsSmallbusinessesGovernmentmarkets:Somecompaniessellprimarilytogovernmentbuyers.LockheedMartinmakesalmostallofitssalestoorthroughtheU.S.government.VanderWolfImages/Shutterstock;KristofferTripplaar/AlamyStockPhotoCopyrightThisworkisprotectedbyUnitedStatescopyrightlawsandisprovidedsolelyfortheuseofinstructorsinteachingtheircoursesandassessingstudentlearning.Disseminationorsaleofanypartofthiswork(includingontheWorldWideWeb)willdestroytheintegrityoftheworkandisnotpermitted.Theworkandmaterialsfromitshouldneverbemadeavailabletostudentsexceptbyinstructorsusingtheaccompanyingtextintheirclasses.Allrecipientsofthisworkareexpectedtoabidebytheserestrictionsandtohonortheintendedpedagogicalpurposesandtheneedsofotherinstructorswhorelyonthesematerials.PrinciplesofMarketingNineteenthEditionChapter7CustomerValue–DrivenMarketingStrategy:CreatingValueforTargetCustomersCopyright?2024,2021,2018PearsonEducation,Inc.AllRightsReservedLearningObjectives7.1Definethemajorstepsindesigningacustomervalue-drivenmarketingstrategy:marketsegmentation,targeting,differentiation,andpositioning.7.2Discussthemajorbasesforsegmentingconsumerandbusinessmarkets.7.3Explainhowcompaniesidentifyattractivemarketsegmentsandchooseamarket-targetingstrategy.7.4Discusshowcompaniesdifferentiateandpositiontheirproductsformaximumcompetitiveadvantage.FACEBOOK(META):TargetingtheDiverseNeedsofDifferentSocialMediaSegmentsThankstosuccessfulsegmentationandtargeting,Facebook/Meta’sfourhugesocialmediaplatforms—Facebook,Instagram,WhatsApp,andMessenger—nowconstitutefourortheworld’stopfivesocialmediabrands.rvlsoft/ShutterstockLearningObjective1Definethemajorstepsindesigningacustomervalue-drivenmarketingstrategy:marketsegmentation,targeting,differentiation,andpositioning.CustomerValue–DrivenMarketingStrategyFigure7.1DesigningaCustomerValue–DrivenMarketingStrategyLearningObjective2Discussthemajorbasesforsegmentingconsumerandbusinessmarkets.MarketSegmentation(1of14)Marketsegmentationrequiresdividingamarketintosmallersegmentswithdistinctneeds,characteristics,orbehaviorsthatmightrequireseparatemarketingstrategiesormixes.MarketSegmentation(2of14)SegmentingconsumermarketsSegmentingbusinessmarketsSegmentinginternationalmarketsRequirementsforeffectivesegmentationMarketSegmentation(3of14)SegmentingConsumerMarketsGeographicsegmentationDemographicsegmentationPsychographicsegmentationBehavioralsegmentationMarketSegmentation(4of14)SegmentingConsumerMarketsGeographicsegmentationdividesthemarketintodifferentgeographicalunitssuchasnations,regions,states,counties,cities,orevenneighborhoods.MarketSegmentation(5of14)SegmentingConsumerMarketsDemographicsegmentationdividesthemarketintosegmentsbasedonvariablessuchasage,life-cyclestage,gender,income,occupation,education,religion,ethnicity,andgeneration.MarketSegmentation(6of14)SegmentingConsumerMarketsPsychographicsegmentationdividesamarketintodifferentsegmentsbasedonsocialclass,lifestyle,orpersonalitycharacteristics.Hyperlocalsocialmarketing:BurgerKing’sboldWhopperDetourcampaignoffereddeeplydiscountedWhopperstoanyBKappuserwithin600feetofaMcDonald’s.JoernPollex/GettyImages;nikdoorg/123RFMarketSegmentation(7of14)SegmentingConsumerMarketsAgeandlife-cyclestagesegmentationdividesamarketintodifferentageandlife-cyclegroups.Gendersegmentationdividesamarketintodifferentsegmentsbasedongender.Incomesegmentationdividesamarketintodifferentincomesegments.Gendersegmentation:ToycompanyLEGOGroupannouncedrecentlythatitwillworkhardertoremovegenderstereotypesfromitsproductsandmarketing.CreativaImages/ShutterstockMarketSegmentation(8of14)SegmentingConsumerMarketsBehavioralsegmentationdividesamarketintosegmentsbasedonconsumerknowledge,attitudes,usesofaproduct,orresponsestoaproduct.Lifestylesegmentation:RockyMountainTinyHousescaterstothe“tinyhouse”lifestylesegmentofconsumersseeking“aplaceofprideandcomfort,yetoneofsimplicityandaffordability.”“LiveSimply,”advisesthecompany.ppa/ShutterstockMarketSegmentation(9of14)SegmentingConsumerMarketsBehavioralSegmentationOccasionsBenefitssoughtUserstatusUsagerateLoyaltystatusBenefitsegmentation:Schwinnmakesbikesforeverybenefitsegment.“Nomatterwhatyou’relookingfor,”saysSchwinn,“we’vegotalineofbikesforyou.”UsedwithpermissionofPacificCycleIncMarketSegmentation(10of14)SegmentingConsumerMarketsMultiplesegmentationisusedtoidentifysmaller,better-definedtarget