Consumer Behavior and Technology

Consumer Chapter
Behavior 01
Consumer Behavior
and Technology
Learning Objectives
1.1 To understand the evolution of the marketing concept, what consumer behavior is, and the
components of strategic marketing.
1.2 To understand how technology has benefited both marketers and consumers.
1.3 To understand providing value and satisfaction and how technology has enhanced customer loyalty
and retention.
1.4 To understand marketers’ social and ethical responsibilities.
1.5 To understand consumer decision-making as the foundation of this book.
1.6 To explain how the knowledge of consumer behavior advances seeking employment after graduation.
Marketing
Marketing is the activity, set of institutions, and processes for
creating, communicating, and delivering offerings that have
value for customers, clients, partners, and society.
Consumer Behavior
Consumer behavior is the study of consumers’ choices during

searching, evaluating, purchasing, and using products and
services that they believe would satisfy their needs.
What Can a product Help Express About its Owner?
Sleek
Modern
Expensive
• Presence of healthy food option
“licensed” consumers to eat
Vices unhealthy food

• Estimated burger calories
& decreased over 100 calories when
accompanied by three celery
Virtues sticks.
• How and why do consumers
make decisions based on other
factors than facts and rationality?
Learning Objective 1.1
To understand the evolution of the
marketing concept, what consumer
behavior is, and the components of
strategic marketing.
Marketing Concept
The premise that marketing consists of satisfying consumers’

needs, creating value, and retaining customers, and that
companies must produce only those goods that they have
already determined would satisfy consumer needs and meet
organizational goals.
Marketing Concept
Application
How does the Vans ad

relate to the marketing
concept?
Development of the Marketing Concept
Production Concept
Development of the Product Concept
Marketing Concept
Selling Concept
Production Concept Product Concept Selling Concept Marketing Concept

Production
Marketing
Product
SellingConcept
Concept Marketing Concept
Marketing Myopia
• Short-sighted approach where companies “look

in the mirror instead of out the window”
• In other words, managers focus on the product,
not the needs it is designed to fulfill
Marketing Concept Requirements
The Marketing
Targeting Mix (4 Ps)
Market Positioning
Segmentation
To understand how
technology has benefited
both marketers and
consumers.
Value Exchange
• Technologies create a value exchange
• Technology makes it easier to shop
and access information,
entertainment, and customized
products
• Consumers pay for content with
information about themselves
Consumers Have Embraced Technology
Most Prominent
Online
Activities
More Precise Cookies
Targeting
Interactive Global Positioning

communications Systems (G P S)
Selfies
Cross-Screen Marketing
A promotional strategy that consists of tracking and targeting
users across their computers, mobile phones, and tablets, and
sending them personalized ads based on their interests, as
observed by marketers.
How does technology affect the Marketing
Mix?
Provide examples Discussion
• Interactive and novel communication Question
channels
• Customizing products and promotional
messages
• Better prices and distribution
To understand providing value and
satisfaction and how technology has
enhanced customer loyalty and retention.
Successful Relationships (1 of 3)
Value, Satisfaction, and Retention
• Customer Value
• Customer Satisfaction
Defined as the ratio between the customer’s
• Customer Retention perceived benefits and the resources used to obtain
those benefits
Perceived value is relative and subjective
Developing a value proposition is critical
Discussion • How does McDonald’s create value
for the consumer?
Questions
• How do they communicate this value?
• Customer Value
• Customer Satisfaction
• Customer Retention  The individual's perception of the performance of the
product or service in relation to his or her
expectations.
 Customer groups based on loyalty include loyalists,
apostles, defectors, terrorists, hostages, and
mercenaries
• Customer Value
• Customer Satisfaction  The objective of providing value is to retain highly
• Customer Retention satisfied customers.
 Loyal customers are key
 They buy more products
 They are less price sensitive
 Servicing them is cheaper
 They spread positive word of mouth
Customer Relationships
For Discussion:
Provide two examples where brands used technology to engage consumers/enhance
customer relationships.
Provide two examples where technology was used to add value to the consumer.
Forms of Engagement
Emotional Bonds
 Personal commitment and attachment
 Social media attempts to get consumers to engage emotionally with products and
brands
Transactional Bonds
 Mechanics and structures that facilitate exchanges between consumers and sellers
 Factors like assortment and transaction ease could shape the relationship
Determinants of Site Satisfaction
• Adaptation • Transaction ease
• Interactivity • Engagement
• Nurturing • Loyalty
• Commitment • Inertia
• Network • Trust
• Assortment
Profitability-Focused Segmentation
Miles Travelled Annually and Matching Revenues
Airplane’s Class and At least At least At least
Matching Revenues 250,000 150,000 100,000
per Mile Miles miles miles
First Class $ 1,000,000 $ 600,000 $ 400,000
($ 4 per mile) DIAMOND EMERALD EMERALD
Business Class $ 500,000 $ 300,000 $ 200,000
($ 2 per mile) EMERALD SAPPHIRE SAPPHIRE
Premium Economy $ 150,000 $ 90,000 $ 60,000
($ 0.6 per mile) ELITE SELECT SELECT
Economy $ 75,000 $ 45,000 $ 30,000
($ 0.3 per mile) SELECT
Measures of Customer Retention
Customer valuation Retention rates Analyzing defections

Review Question
• What is the difference between emotional and transactional
bonds?
• Identify and describe four of the eleven determinants of
customer satisfaction with online merchants. Characterize each
selected determinant as primarily driven by emotion or
stemming from the mechanics of the transaction.
To understand marketers
social and ethical
responsibilities.
Social Responsibility
Companies incorporate social Marketing ethics and social Socially responsible

goals into their mission responsibility can shape activities improve
statements organizational effectiveness image among
stakeholders
To understand consumer decision-

making as the foundation for this
book.
Consumer Decision Making (1 of 2)
• Inputs
– Firm marketing efforts
– Sociocultural influences
• Process
– Psychological factors
– Need Recognition, Decision Type, Prepurchase Search, Evaluation of
Alternatives
– Learning
• Outputs
– Purchase
– Post-purchase evaluation
Consumer Decision
Making (2 of 2)
To explain how knowledge

of consumer behavior
advances seeking
employment after
graduation.
Employment
Opportunities Advertising
Consumer
research
Brand
management

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Consumer Behavior and Technology

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Consumer Chapter

Consumer behavior is the study of consumers’ choices during

Vices unhealthy food

The premise that marketing consists of satisfying consumers’

How does the Vans ad

Development of the Product Concept

Production Concept Product Concept Selling Concept Marketing Concept

• Short-sighted approach where companies “look

Interactive Global Positioning

Customer valuation Retention rates Analyzing defections

Companies incorporate social Marketing ethics and social Socially responsible

To understand consumer decision-

To explain how knowledge

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