MAKETING MANAGEMENT

Class 2
Consumer markets and buying behavior
Business markets and business buying behavior
Marketing research

Asso. Prof. Dr. Le Thi My Linh

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Learning Objectives of Chapter 3

After studying the chapter 3, you should be able to:

1. Identify key four major factors that influence
consumer buyer behavior
2. Explain the role cultural, social, and personal
factors play in consumer behavior
3. Explain how consumers’ needs, emotions, and
memory influence their behavior
4. Illustrate the key stages of the buying decision
process.
Model of Consumer Behavior

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Customer analysis
• Who are the current and potential customers for the product or
service?
• Why do they buy?
• How do they make purchasing decisions?
• Where do they buy the product or service, that is, what
channels of distribution are used?
• When do they buy?

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Factors influencing consumer behavior

Social
Culture
Reference groups
Culture
Family
Subculture
Roles and status
Social class

Buyer
Personal
Psychological
Motivation Age and lifecycle stage
Perception Occupation
Learning Economic circumstances
Memory Value and Lifestyle
Personality and self concept
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Factors Affecting Consumer Behavior:
Culture
Culture – shared social values, norms &
roles ... “a handed down way of life”
• Most basic cause of a person's wants and behavior.
• Values
• Perceptions

Subculture Social Class

• Groups of people with shared • People within a social class
value systems based on common tend to exhibit similar buying
life experiences. behavior.
• Vietnamese Consumers • Occupation
• African American Consumers • Income
• Asian American Consumers • Education
• • Wealth
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Factors Affecting Consumer Behavior:
Social
Groups
•Membership
•Reference: Aspirational vs.
dissociative

Family
•Husband, wife, kids Social Factors
•Influencer, buyer, user

Roles and Status

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Types Of Family Decision making

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Discussion Scenario

Consider your purchasing behavior as well as

that of family members.
Does the influence of reference groups,
family, and social/roles status vary across
product categories, situation, or by family
member? If so, how and why?

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Factors Affecting Consumer Behavior:
Personal
Personal Influences

Age and Family Life Cycle

Occupation
Stage

Economic Situation Personality & Self-Concept

Lifestyle Identification

Activities Opinions

Interests

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Factors Affecting Consumer Behavior:
Psychological

Motivation

Psychological
Memory Factors Perception

Learning

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Consumers Have Many Attitudes

Individuals Products

Ads Brands
Attitudes
Toward:
Media Companies

Retailers Organizations

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Customers and Role Specialization
• Customer
• Client
• User
• Consumer
• Payer
• Buyer

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The Buyer Decision Process
Need Recognition

Information Search

Evaluation of Alternatives

Purchase Decision

Post-purchase Behaviour

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 Step 1: Need Recognition
Sources of Problem Recognition

New Needs
Out
Out of
of Stock
Stock Dissatisfaction
or Wants

Related Product Market-Induced New

Purchase Recognition Products
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©
Maslow’s Hierarchy of Needs
Self
Actualization
(Self-development)

Esteem Needs
(self-esteem, status)
Social Needs
(sense of belonging, love)

Safety Needs
(security, protection)

Physiological Needs
(hunger, thirst)

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Step 2: Information Search: Sources
•Family, friends, neighbors
Personal Sources •Most effective source of
information
•Advertising,
salespeople
Commercial Sources •Receives most
information from these
sources

Public Sources •Mass Media

•Consumer-rating groups

•Handling the product

Experiential Sources •Examining the product
•Using the product
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Step 3. Evaluation of Alternatives

Product Attributes
Evaluation of Quality, Price, & Features

Degree of Importance
Which attributes matter most to me?

Brand Beliefs
What do I believe about each available brand?

Total Product Satisfaction

Based on what I’m looking for, how satisfied
would I be with each product?

Evaluation Procedures
Choosing a product (and brand) based on one
or more attributes.
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Two Forms of Evaluative Criteria

Evaluative Criteria

Objective Subjective

Price Style
Warranty Appearance
Service Image

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Step 4: Purchase Decision
Purchase Intention
Desire to buy the most preferred brand

Attitudes Unexpected
of Others Situational
Factors

Purchase Decision

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Step 5. Postpurchase Behavior

Consumer’s Expectations of
Product’s Performance

Product’s Perceived
Performance

Satisfied Dissatisfied
Customer! Customer

Cognitive Dissonance
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Postpurchase Behavior

Cognitive Dissonance

?
Did I make a good decision?

Did I buy the right product?

Mar keting
Can minimize through:
Effective Communication
Follow-up
Guarantees
Warranties
Underpromise &
overdeliver
Did I get a good value?

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Types of Consumer Buying Decisions
•Expensive •Low cost
•Risky •Low risk
•Infrequent High Low •Frequent
•Self-Expressive Involvement Involvement

Significant Complex Variety-

differences Buying Seeking
between
brands Behaviour Behaviour

Few Dissonance- Habitual

differences
between Reducing Buying Buying
brands Behaviour Behaviour

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• quickly list 10 items you have purchased in the past
month

• reexamine how long it took you to make a decision

on each

• why did such a difference in decision occur?

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• think of an important purchasing decision
you have made

• what are some of the thoughts you have had

following your purchase? Any regrets?

• what has influenced those thoughts?

• how have you dealt with the discomfort?

• how has the company anticipated or dealt with

your discomfort?

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Personal Variable Models – Trade-off
Hotel Distance from Downtown (in miles)
Service
15 10 5 2
Level
Four-star (12) (8) (4) (1)
Three-star (13) (9) (5) (2)
Two-star (15) (11) (7) (3)
One-star (16) (14) (10) (6)
* The numbers in parentheses indicate the rank ordering of each
given combination, with (1) representing the most preferred and
(16) the least preferred.

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 Service Level Distance from Swimming Pool
(in # of stars) Downtown (in Yes No
4 3 2 1 miles)
2 5 10 15
Rate/night
$70 1 3 5 9 1 2 5 6 1 3
$100 2 4 6 10 3 4 8 10 2 4
$150 7 8 11 14 7 9 11 13 3 6
$200 12 13 15 16 12 14 15 16 7 8
Service Level (in
stars)
4 1 4 8 12 1 4
3 2 5 9 13 2 5
2 3 6 11 15 3 7
1 7 10 14 16 6 8
Distance from
Downtown (in
miles) 1 3
2 2 4
5 5 6
10 7 8 27
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Decision Making Unit - Family

➢Initiator
➢Influencers
➢Decider
➢Purchaser
➢Users

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4 - 28
Organizational
vs.
Consumer Buying
Behavior
 Learning Objectives of Chapter 4
After studying the chapter 4, you should be able to:
4.1 Explain the key aspects of the organizational buying process.
4.2 Define the role of the buying center in an organization.
4.3 Describe the stages of the decision process in business markets.
4.4 Explain how organizations develop marketing programs to attract and
retain business customers.
4.5 Describe how business-to-business marketers build and maintain
relationships with customers.
Organizational Buyers
• Industrial Markets
• buyers who produce and sell other things
• Kodak buys chemicals
• Trade Industries
• Companies that buy and resell
• Wholesalers and Retailers
• Government
• federal, state, and local
• e.g., national defense, public safety
• Institutions
• Universities, Hospitals
Organizational Buying
• Buyers technically trained
• Criteria explicit and needs specialized
• Multiple buying influences
• Multiple vendors used to reduce risk
• Longer decision-making time frame
• Greater importance of personal selling
Types of Organizational Buying Decisions

New Task Buying

Involved Decision Making

Modified Rebuy

Straight Rebuy
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Three Buying Situations
1. New Task
• New task—the problem or need is totally
different from previous experiences.
• Significant amount of information is
required.
• Buyers operate in the extensive problem
solving stage.
• Buyers lack well defined criteria.
• Lack strong predispositions toward a
solution.

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Three Buying Situations
2. Modified Rebuy

• Modified rebuy—decision makers feel there are

benefits to be derived by reevaluating alternatives.
• Most likely to occur when displeased with the
performance of current supplier.
• Buyers operate in the limited problem solving
stage.
• Buyers have well defined criteria.

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Three Buying Situations
3. Straight rebuy

• Straight rebuy—the problem or need is a

recurring or continuing situation.
• Buyers have experience in the area in
question.
• Require little or no new information.
• Buyers operate in the routine problem
solving stage.

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Decision Making Unit - Organization
Users Deciders

Influencers

Purchase decision
Initiators

Preparer

Gate keepers
Buyers

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Organizational Buying Stages
Identify need

Determine characteristics

Establish specifications

Identify potential sources

Request proposals

Evaluate proposals

Select supplier

Make post purchase evaluation

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Questions for the Industrial Salesperson
1. Which member takes part in the buying
process?
2. What is each members relative influence in
the decision?
3. What criteria is important to members in the
evaluation process?

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 Learning Objectives of Chapter 5

After studying the chapter 5, you should be able to:

5.1 Define the scope of marketing research.

5.2 Explain the marketing research process, how to gather and analyze
market data, and how to develop a research plan.
5.3 Explain how to measure and forecast market demand.
5.4 Define the different approaches to measuring marketing productivity
 Marketing research is all about generating insights

Marketing research is the function that links the

consumer, customer, and public to the marketer
through information used to identify and define
Marketing research marketing opportunities and problems; generate,
refine, and evaluate marketing actions; monitor
marketing performance; and improve understanding
of marketing as a process

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Marketing Research Process
1. Define the Problem
2. Develop research plan (Research Objectives, Research design
(data sources, research approaches, research instruments,
sampling plan, and contact methods.
3. Collect data
4. Analyse the collected data
5. Writing report, present the findings
6. Make the decision

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 INFORMATION SOURCES

Primary Secondary
In depth
interview
Observation Surveys Internal External
Focus group
Mail Telephone Personal
Email
online

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Types of Secondary Data Gathering
• Country information - http://www.doc.gov
• Nielsen, Gallup, Qualtrics, In 2018, Qualtrics was acquired by SAP

- http://www.acnielsen.com
• Sales figures
• Reports from salespeople
• Industry organizations - www.icsc.org
• Always use secondary data if it is sufficient to achieve research
objectives

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Key concept in Demand Measurement
• Market demand for an offering is the total volume that could be bought by
a defined customer group in a defined geographic area in a defined time
period in a defined marketing environment under a defined marketing
program

• Market potential—consists of the maximum sales available to all firms in

an industry during a given period, under a given level of industry
marketing effort, and under extant environmental conditions.

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Key concepts in Demand Measurement
Company demand and sales forecasts
• Company demand:
• company’s estimated market share under different
levels of marketing effort in a given time period

• How will sales change based on level of advertising,

promotion, sales effort, etc?
• Company sales forecast: is the expected level of company
sales based on a chosen marketing plan and an assumed
marketing environment.
• Used to make current purchasing and production
decisions
• Sales quota: sales goal
• Used to define and stimulate sales effort 46
Forecasting market demand
• All forecasts are built on one of three information bases:
what people say, what people do, or what people have
done.
• Industry Sales and Market Shares: actual industry sales
taking place in Co’ market, it means identifying
competitors and estimating their sales. Each company can
evaluate its own performance against the whole industry.
• Survey of Buyers’ Intentions
• Composite of Sales Force Opinions.
• Expert Opinion.
• Past-Sales Analysis

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Estimating Current Demand
 Total market potential—the maximum number of sales that
might be available to all of the industry’s firms during a given
period, under a given level of industry marketing effort and
environmental conditions.
 To estimate current demand, companies need to determine the
size, growth, and profit potential of each market opportunity.

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Estimating Future Demand
To estimate future demand companies survey buyers’ intentions, solicit the
input of their sales forces, gather expert opinions, analyze past sales, or
engage in market testing.

Three information bases: what people say, what people do, or what
people have done
✓Survey of buyers’ intentions
✓Composite of sales force opinions
✓ Expert opinion: distributors, suppliers, consultants
✓Past-sales analysis
✓Market-test method

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 Measuring Marketing Productivity

- Marketing research must assess the efficiency and effectiveness of

marketing activities.
- Two complementary approaches to measuring marketing productivity are:
(1) marketing metrics to assess marketing effects

(2) marketing-mix modeling to estimate causal relationships and measure

how marketing activity affects outcomes.

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