Mmasian's Blog

Consumer behavior: Past, Present and the Future

mmasian — Sun, 21 Mar 2010 16:09:03 +0000

In this aggressively interactive environment, what a company has to adapt is change.
Martin, Mooreman, Rust and Bahlla all stressed out that maximizing customer satisfaction is far off more important than giving value to shareholders and gaining profit. I agree with them on that matter. As a consumer, I want to my needs to be fully satisfied. I will tend to buy products which I think can satisfy my need and consider also its price. After having an empirical experience with the product that I bought and attesting that it is a god one, I will constantly buy that certain product. This is strongly supported by Howard and Sheath’s A Theory of Buyer Behaviour. There are elements in buyer’s decision brand: set of motives; several alternative courses of action and; decision mediators by which the motives are matched with the alternatives. By having an ample knowledge that this certain product can satisfy one of my wants then I will tend to repeat my purchase of that brand. Since the consumer has accumulated sufficient experience and information, brand ambiguity is eliminated. Seek for knowledge about that need is somewhat already disregarded since satisfaction already occurred. At times like these customers satisfaction should always be the top priority because the consumers greatly affect the status of a business firm.
The CEOs contribute in making a firm more customer oriented since they are the ones who monitors the whole process in their businesses. I would like to commend James Burke, a former CEO since I think he showed and exemplary act even if his name was at stake. He disregarded profit loss just to do what is right. All CEOs must be dutiful and possess good qualities of being a leader. Like in the articles written about the recall of Toyota, since it was reported that a lot of accidents have been happening and a lot of them involves a Toyota vehicle. The company was asked to do a recall and by recalling thousand s of vehicles meant losing a lot of profits. This issue is an example of an important problem each company is faced with. Two questions are; does the company innovate and make a lot of cars because a) they want their consumers to enjoy the new cool cars that they are introducing in the market and that they are fully aware about each section of their vehicles? And b) If Toyota is interested in the company’s profit. But the issue has already happened; the essence of this is that companies should always be consumer-centric more than anything else. The only fault I see about the company is that what they did not respond immediately regarding their vehicles’ complaints. Though the company’s president Toyoda made a public apology, the immediateness of despondence about the case is what still matters. The case in happened to Toyota is common among other brands of vehicles too. But it’s a big deal since a lot of people patronize Toyota, and the sudden increase of acceleration causing accidents happened should not be taken for granted. Consumer behavior decides on how a product is to be sold and packaged. Finally, as marketers or as any individual who is part of the marketing and commerce world, we must realize that customers’ satisfaction and safety must always be first as innovation of cars continue to increase. If a complaint is served, comply to it immediately, and not wait for consumers to complain again and ask for recalls. The CEOs and the CMOs are the ones accountable for the increasing profitability of the firm’s customers. To be a successful CEO or CMO one must promote a customer-centric culture and remove the obstacles to the flow of customer information throughout the organization. A product cannot be sold if it were not sold by marketers. Since we are used to the traditional marketing process, buying and selling, David Court mentioned in his article about CMOs that they must be prepared especially since a type of marketing approach emerged and this is thru the Internet. The Internet is considered as the biggest shift in today’s marketing world. Since, change is constant CMO’s are expected to be competent enough to meet the diverse challenges that they are about to face in the marketing world. Both CMO’s and CEO’s must work hand in hand in order to be competent with other emerging marketing strategies and fields.
Convenience is one factor that affects consumer in decision making. An example in the article is that a guy purchased a lot of beers rather than spending his time at a pub. This can be supported by what is happening right now to Japan. The attitudes and behaviours of the Japanese are changing dramatically. We can attribute the guy’s purchase of beers instead of going to pubs by the Japanese current belief which is “To spend time to save money”. This is also a result of the changing time that consumers are now more conscious to what they are specifically investing their time and money on. Economic crisis surely affects the consumers’ decision making. The Internet plays a major role as the leading source of convenience especially among the people of China and Japan. A number of consumers just stay at home and surf the web. Even in purchasing products like food. While the needs of consumers differ from their needs before, the means in satisfying this needs evolved as well. The Internet is one of the evolutions that occurred as response to the consumer behaviour of people. Online marketing is rampant and is a fad today. Purchasing of food can be made through the Internet. Technology comes not only from the plain old television that we have but as well as with our mobile phones. A lot of mobile phones (Nokia, iPhone, BlackBerry, Samsung, Sony Ericsson and the likes) cater Internet. With that small screen people can make purchases by just logging in. Firms must be versatile in adapting with these rapid changes in marketing especially in online marketing.
Research is also very important in selling products. In Rethinking Marketing, it was stated there that products that have too complicated features will tend to be not customer –friendly as a result, obviously, sales would not be commendable. Marketing is part of research and it should not be taken for granted because it makes half of the success of the product making. In research there are two things to remember: Quantitative and Qualitative approach in gathering data. Since marketing is a highly complex area, quantitative approached is used. In order to obtain quantitative data new techniques are to be used. Techniques also changes and advances as the rapid change in the environment occurs. This rapid change has its pros and cons. Advancement in techniques could provide various ways in simplifying problems but overusing and misusing these techniques could fail our desires. Technique is just like fashion because it can come and go. Once it is a fad and the newest thing there is people start to consume it. However, if there is a new advanced technique available that old technique could be “forgotten”. The most popular type of modeling technique appeared to be to use the computer to interrogate a complex symbolic model and then to use a graphical user interface to present the results. Research would not be complete and logical if it does not involve qualitative research. Triangulation is discussed in the article. It means the combination of methodologies in the study f the same phenomena. Triangulation blends and integrates a variety of data and method. In this method he use of multiple measures may also uncover some unique variance which otherwise may have been neglected by single methods. It is here that qualitative methods, in particular, can play an especially prominent role by eliciting data and suggesting conclusions to which other methods would be blind. Triangulation is a means in research that allows us to come up with various results. Thus, researchers will be more guided in concluding their research. This method answers questions as well as alternative answers since like what is stated above, it use various techniques. With this guide old theories may be refashioned. Development of new ideas will be created and researchers will be able to provide a more sensible and enriched explanations to the problem. Another approach of research is that of Katona’s since he is a psychologist. He was trying to integrate the usage of Psychology in developing formal logics of economic actions. There are differences between an Economic and Psychological approach. Psychologists start their approach by first observation, derive hypotheses, test those hypotheses, reformulate the given hypotheses then try and revised it again. While in Economic approach there is the absence of psychological research of detailed systematic elaboration prior to observation. It was included in his article that through the use of Psychological method, psychologists can draw on: the theory of learning and thinking; the theory of group belonging; and the theory of motivation. There is what we call the Habitual Behaviour and the Problem Solving Behaviour in analyzing the rationality of man. Habitual behaviour is about what a man will most likely decide based on what he has already experienced in the past which turned out to be successful and effective. His past decision greatly affects his next one. While the Problem Solving Behaviour is wherein a man starts to deliberate questions in his mind wherein he weighs decisions accordingly. But in most cases as well as based on a personal experience I always go for the Habitual Behaviour because I am certainly not a fan of taking risks which is bad though. The article of George Katona made me see the lack of contact between economists and psychologists. There is a necessity of studying and considering all types of variables whether is it from a different field. It was given emphasis in the article motives and goals that change with and are adapted circumstances, but all of these are in all aspects significant for us to be fully aware of problems and be able to attempt to solve them. With this we can all try to be rational.
Going back to The Age of Customer Capitalism and Rethinking Marketing the two articles share the same idea that businesses nowadays should be consumer centric, but the two articles differ in the sense that Martin stated that there is no way to simultaneously optimize two different things. That it is possible to maximize two desirable variables or to minimize two undesirable variables. It is possible to maximize shareholder value given a minimum hurdle of customer satisfaction, or to maximize the customer’s satisfaction given a minimum, hurdle for shareholder value appreciation, but you can’t maximize both.
While in the article of Bahlla et al they stated that both can be achieved at the same time. My take on this two opposing ideas is that, both customer satisfaction and value for shareholders can be achieved at the same time. But achieving these two things cannot happen overtime. A firm that gives high importance to their customers will have their market sales increased since their customers will give out their loyalty to them. For a reasonable period of time, the value for shareholders will soon eventually be given since the firm’s profits tend to increase due to consumers’ patronization. The things that I have learned in all the articles that I have read are very vital in shaping me to become successful in the future. As a Corporate and Marketing Communications student it is expected that I should be equipped with proper knowledge in the field that I am taking. I must be adept with the changes that are happening in the marketing world. The articles that were provided as reading materials to this course did not only made me gain adequate knowledge about the terms and skills that I should be learning, but it also taught me how to become both a good person and a good marketer. I have learned to not put at stake a consumer’s health or situation just for me to earn profit or be promoted. It is necessary for me to give value to consumers rather than give more importance to my own personal gains. I can say that as a sophomore student of Marketing I’m already equipped with the things that are needed as soon as I graduate and step into the real marketing world. I am grateful that I am given the opportunity to learn all these things at a young age. I consider this as an advantage from everybody else who is taking marketing. With all these learnings it is up to me now how I will shape and apply it to myself. I am also grateful because I had the chance to become the student of Mr. Lui San Juan. Indeed I was cursed due to my absences, he makes threatening yet hilarious remarks in class and gives us never ending papers. But I realize that all these reading materials have purposes in my life. It challenged me to be brilliant and impressive even if I am under time pressure. I hope more marketing students will experience the things that I have experienced throughout this course. It was challenging, full of insights, very knowledgeable and fun.

Seeking Knowledge

mmasian — Wed, 17 Mar 2010 01:41:22 +0000

I am taking up Marketing and Corporate Communications and basically my course is shaping me to become a good seller, research analyst and marketing executive. Those three jobs mentioned above would not be effective as possible if I am not good on the second job, which is the research analyst.

In research there are two things to remember: Quantitative and Qualitative approach in gathering data. Since marketing is a highly complex area, quantitative approached is used. In order to obtain quantitative data new techniques are to be used. Techniques also changes and advances as the rapid change in the environment occurs. This rapid change has its pros and cons. Advancement in techniques could provide various ways in simplifying problems but overusing and misusing these techniques could fail our desires. Technique is just like fashion because it can come and go. Once it is a fad and the newest thing there is people start to consume it. However, if there is a new advanced technique available that old technique could be “forgotten”. The most popular type of modelling technique appeared to be to use the computer to interrogate a complex symbolic model and then to use a graphical user interface to present the results.

It is also important that the company supports their employees. A company must aim their employees to be equipped with knowledge about he usage of advanced techniques in research. This could be possible by letting their marketers attend external training regarding the topic. Another important thing that I realized is that, professors of undergraduate marketing students must already teach them or introduced quantitative research that has extensive usage of figures. Perhaps, this will greatly shape and help future employees in the marketing world to have knowledge about it and will soon enhace it as soon as they graduate.

Research would not be complete and logical if it does not involve qualitative research. Triangulation is discussed in the article. It means the combination of methodologies in the study f the same phenomena. Triangulation blends and integrates a variety of data and method. In this method he use of multiple measures may also uncover some unique variance which otherwise may have been neglected by single methods. It is here that qualitative methods, in particular, can play an especially prominent role by eliciting data and suggesting conclusions to which other methods would be blind.

Triangulation is a means in research that allows us to come up with various results. Thus, researchers will be more guided in concluding their research. This method answers questions as well as alternative answers since like what is stated above, it use various techniques. With this guide old theories may be refashioned. Development of new ideas will be created and researchers will be able to provide a more sensible and enriched explanations to the problem.

Consumer Centric

mmasian — Sun, 28 Feb 2010 16:20:39 +0000

Change is constant. With this, people tend voluntarily or involuntarily to cope up with these changes that are happening around them. As change arose, technology also emerges and copes up with the pace of life. Companies in this matter cope up with the rapid changing situations in life.

Toyota, one of the leading automobile making company is faced with a very crucial problem. The company is asked to recall a lot of cars because of complaints and reported deaths that involves a Toyota vehicle. From 2001 – 2010 the reports about Toyota accidents increased relatively. From my own perspective, since Toyota is from Japan, a first world country that is known for its drive to excel in the field of technology obviously took innovations into the next level. The only problem that I see in this innovation is its rapidness. Because of its rapid innovation Toyota took for granted the safety precautions of its vehicles. Reports about the sudden increase of its acceleration were probably one of the causes of the reported accidents.

With this, the Toyota Company was sued and was asked to be present in Washington to clear out the problems and causes regarding the issues. Toyoda, the grandson of the founder of Toyota faced the jurors and defended his company. Not everyone was convinced about his defence with his company’s side. Since the recalls of Toyota’s vehicles were made, the company lost billions of dollars. Toyoda was questioned about not responding immediately to the complaints and concerns of their consumers. Though Toyota promised to cooperate with is personal interest in resolving the issue.

This issue is an example of an important problem each company is faced with. Two questions are; does the company innovate and make a lot of cars because a) they want their consumers to enjoy the new cool cars that they are introducing in the market and that they are fully aware about each section of their vehicles? And b) If Toyota is interested in the company’s profit. But the issue has already happened; the essence of this is that companies should always be consumer-centric more than anything else. The only fault I now I see about the company is that what they did not respond immediately regarding their vehicles’ complaints.

In what had happened to Toyota is common among other brands of vehicles too. But it’s a big deal since a lot of people patronize Toyota, and the sudden increase of acceleration causing accidents happened should not be taken for granted. Consumer behaviour decides on how a product is to be sold and packaged. Finally, as marketers or as any individual who is part of the marketing and commerce world, we must realize that customers’ satisfaction and safety must always be first as innovation of cars continue to increase. If a complaint is served, comply to it immediately, and not wait for consumers to complain again and ask for recalls.

Siding with Katona

mmasian — Wed, 17 Feb 2010 08:22:33 +0000

After having read the article of Katona, I learned that though Economics may be considered as the main branch of science that deals with business cycle, we should also be open to other branches of science like Psychology in understanding the behavioural patterns of consumers. I for a fact agree with what Katonah was trying to imply in her article.

We should not believe in all the traditional theories that we know regarding one issue. Our minds should be imaginative and we must always interrogate our adapted thoughts. Because really, what we know—what the experts have taught us is all wrong after all. What I am saying directly pertains to the Economic theory. Stated in the Economic theory are that an economic man or rational man; has the principle of complete information and foresight; the principle of complete mobility; the principle of pure competition. After having developed these assumptions, theorists introduced changes so that the theory may approach reality. But as what is also mentioned in the article that up to now the procedure of gradual approximation to reality has not been completely successful does not invalidate the changed method. I completely disagree with the said assumptions above. A man does not know anything and he cannot by only his influence the process of certain products. Rather others influence his choice and by this altogether they influence the pricing of goods.

So what does Katona trying to prove here? He was trying to integrate the usage of Psychology in developing formal logics of economic actions. There are differences between an Economic and Psychological approach. Psychologists start their approach by first observation, derive hypotheses, test those hypotheses, reformulate the given hypotheses then try and revised it again. While in Economic approach there is the absence of psychological research of detailed systematic elaboration prior to observation. It was included in his article that through the use of Psychological method, psychologists can draw on: the theory of learning and thinking; the theory of group belonging; and the theory of motivation.

There is what we call the Habitual Behaviour and the Problem Solving Behaviour in analyzing the rationality of man. Habitual behaviour is about what a man will most likely decide based on what he has already experienced in the past which turned out to be successful and effective. His past decision greatly affects his next one. While the Problem Solving Behaviour is wherein a man starts to deliberate questions in his mind wherein he weighs decisions accordingly. But in most cases as well as based on a personal experience I always go for the Habitual Behaviour because I am certainly not a fan of taking risks which is bad though.

The article of George Katona made me see the lack of contact between economists and psychologists. There is a necessity of studying and considering all types of variables whether is it from a different field. It was given emphasis in the article motives and goals that change with and are adapted circumstances, but all of these are in all aspects significant for us to be fully aware of problems and be able to attempt to solve them. With this we can all try to be rational.

Understanding Consumer Behavior

mmasian — Thu, 04 Feb 2010 10:54:59 +0000

A sale is made, not in the mind of the salesperson, not over the counter or desk, but in the mind of the buyer. In the marketing field, making sales is the essence of marketing. But one cannot achieve effective marketing immediately because there are several factors that are need to be taken into consideration in doing marketing.

Let’s first start the discussion with the Basic Theory of Human Motivation of Abraham Maslow. In this theory, hierarchy of needs are presented into a pyramid diagram. This hierarchy of needs are divided into five parts, namely; physiological needs; security and protection; social belongingness; self fulfilment; self actualization. According to Maslow’s theory consumers have different needs and you can identify each need from his diagram of human needs. However, a need that is already gratified will no longer be considered as a need. With this, another need arises. In short, if a need is satisfied then it becomes unimportant in the current dynamics of an individual.

In relation to Maslow’s theory that people buy differently because they have different needs, it is also said that people have different consumer behaviours because of several factors such as their backgrounds are different that people have different set of values. People have different “frames of references” and include such behaviour tendencies as conservatism and optimism or pessimism which are deeply rooted and generally guide people’s actions. Also stated in the given chapter, people are different from each other because of different conditions. These different conditions of people are Environmental factors ( temperature, humidity, altitude and other stimuli); General organic states ( fatigue, hunger, sleepiness); Specific conditions induced by chemicals ( alcohol, tobacco, morphine, caffeine); Previous events ( job loss, traffic ticket, a fight with someone); Incentives and Motives (praise, reproof, rivalry, reward or punishment). There are three approaches to understand the buying motives that can surely help salespeople namely, 1) The traditional emotional-rational approach, 2) the problem solving approach, 3) the self concept theory. Desire is very vital in consumer behaviour. Consumer’s desire to try new things out of curiosity greatly affects consumer behaviours.

The 5^th Chapter discusses about The Art of Persuasion. People are mostly motivated by the desire for the future benefits a salesperson offers them. The important thing is the salesperson must convey clearly hid presentation of the product to the consumer. People will accept things if there are no blocking ideas in their minds. In here, seldom is much truth to its suggestion. To be an effective persuader one must also have supporting ideas to its introductions in to support the product that they are offering. Not only the credibility of the salesperson helps affects the acceptance of the consumers to the product, also the intensity with which the suggestion is made affects its approvals.

Since I have already mentioned most of the different reasons of consumer behaviour, it is likewise important to identify the external and important factor that helps in marketing products. A product cannot be sold if it were not sold by marketers. Since we are used to the traditional marketing process, buying and selling, David Court mentioned about a different type of marketing approach and this is thru the Internet. The Internet is considered as the biggest shift in today’s marketing world. Since, change is constant CMO’s are expected to be competent enough to meet the diverse challenges that they are about to face in the marketing world. Both CMO’s and CEO’s must work hand in hand in order to be competent with other emerging marketing strategies and fields. Lastly, a marketing business would not be big if it only focuses on the product or service overtime. Companies must be able to adapt changes and include complexities in their companies for the common good of all. These complexities include the expansion of their business in terms of products and services.

Hello world!

mmasian — Thu, 04 Feb 2010 07:53:25 +0000

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