MNM1505 - Introduction to Consumer Behaviour (MNM1505)
Institution
University Of South Africa (Unisa)
Full summary of MNM1505 Intro to Consumer Behaviour. Summary includes tables & figure with explanations and examples, past exams, and definitions. Can also be used for MNM2605.
MNM1505 - Introduction to Consumer Behaviour (MNM1505)
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MNM1505
Learning Unit 1
42As marketers, we need to understand issues such as
• How consumers think, feel and reason when purchasing products or services
• Aspects in the environment that can affect consumers’ purchasing decisions
• Individual and group factors that influence the behaviour and decision making of
consumers
• Family decision-making principles – who influences the purchasing decision, who
purchases and who consumes the product
• How the lack of knowledge of certain products can hamper purchasing behaviour
• How store layout, design and visual merchandising affect purchasing power
Marketing is a fundamental part of our daily lives. Marketing has two facets:
• First, it is a philosophy, an attitude, a perspective or a management-orientation
that stresses customer satisfaction.
• Secondly, marketing is a set of activities used to implement the philosophy.
The American Marketing Association (AMA) further defines marketing as “the
activity, set of institutions, and processes for creating, communicating, delivering,
and exchanging offerings that have value for customers, clients, partners, and
society at large”
50“Marketing is a process where an organisation, in its drive to meet its
organisational goals, focuses on meeting customers’ needs and wants, by means of
offering the right product, at the right price, at the right place, and by using the right
marketing communication channels and which, in this process, strives to establish
relationships with customers and to develop and grow these relationships with
relevant stakeholders in an ever-changing environment”.
Core purpose of any organisation is to be successful and profitable, thereby meeting
and satisfying the needs and wants of customers. Furthermore, organisations should
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offer customers the right product, at the right place and price, by using the right
promotional elements to reach their target market.
1.2.1 Marketing Mixes (7 P’s)
Stimuli are any elements of input that affect one or more of the five senses, namely
sight, smell, taste, touch and hearing
The marketing mix refers to a unique blend of product, place, promotion and pricing
strategies designed to produce mutually satisfying exchanges with the target market
• Product
The product is the item being offered to customers to satisfy their perceived needs
and wants; and will ultimately bring in the money for the organisation. Therefore, the
features and design of the product need careful consideration. Organisations need to
determine what product features will appeal to the target market for them to be
successful.
• Price
Have you ever wondered if the quality of a product is good if it is considerably
cheaper than its competitors? The price of a product should be a reflection of the
value to the customer and the quality of the product. The cost of the product or
service will ultimately have an impact on the organisation’s profit margins, supply
and demand and the marketing strategy of the organisation.
• Place/Distribution
Place (or distribution) refers to making the products and services available to the
customer, when and where the customer wants them. Distribution therefore refers to
the logistical function of getting the product from the point of production to the place
(store) where the customer wants the product/service. A product should be at the
ideal location – this can be in a store or online.
• Promotion
Having the right product at the right price means nothing if the benefits of the product
are not communicated to the customer. Promotions therefore involve the marketing
communication methods or channels used to inform the target market of the product
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offering, its benefits and differentiating factors. Promotion includes, for example,
advertisements, social media marketing, direct marketing, personal selling, sales
promotion, public relations and sponsorships.
• People
People refer to the individuals who serve the customer – the employees or staff
members of the business who are in direct contact with the customers. Having the
right people are extremely important for any business as they support the product
and service of the business. For example, the sales staff, staff members working at
the tills and the store assistants.
• Physical evidence
Physical evidence refers to the physical environment where the exchange takes
place.
In other words, physical evidence is the visual or tangible cues of the service
product, such as the design and look of the store, the packaging of the product, and
the neatness of the staff and surrounds.
• Processes
The last P refers to the processes, policies and procedures involved in serving the
customer. Businesses have to ensure that they have a well-tailored process in place
to maximise efficiency, costs and ultimately profitability. For example, when you
order a Big Mac Meal from McDonald’s, there are certain processes that take place
in the restaurant to have your order ready in the quickest possible time. This ensures
that
McDonald’s can serve more people in a certain time frame.
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1.2.2 Marketing Concept
The marketing concept can be described as an ethical code or philosophy that
governs all marketing initiatives. It is the way of thinking which determines the course
of action about marketing functions
The essence of the marketing concept lies in five principles:
• Customer-orientation: All actions should be aimed at satisfying the needs and
wants of the customer – “the customer is king”.
• Production-orientation: Production orientation is a philosophy that focuses on the
internal capabilities of the business rather than on the desires and needs of the
marketplace. Here, the business assesses its own resources and capabilities to
determine what it does best, what it can offer, and what is easy to produce given
the available resources.
• Sales-orientation: Individuals will buy products only if the business aggressively
promotes these products. The sales orientation therefore focuses on aggressive
sales techniques used by businesses to entice individuals to buy their products.
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