The Decision Making Process And Physical Activity Marketing Essay

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1st Jan 1970 Marketing Reference this

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All of us are consumers. We consume things of daily use; we also consume and buy these products according to our needs, preferences and buying power. These can be consumable goods, durable goods, specialty goods or, industrial goods. What we buy, how we buy, where and when we buy, in how much quantity we buy depends on our perception, self concept, social and cultural background and our age and family cycle, our attitudes, beliefs values, motivation, personality, social class and many other factors that are both internal and external to us. While buying, we also consider whether to buy or not to buy and, from which source or seller to buy. In some societies there is a lot of affluence and, these societies can afford to buy in greater quantities and at shorter intervals. In poor societies, the consumer can barely meet his barest needs. Therefore, marketers try to understand the needs of different consumers and having understood his different behaviors which require an in-depth study of their internal and external environment, they formulate their plans for marketing.

Consumer behavior can be defined as the decision-making process and physical activity involved in acquiring, evaluating, using and disposing of goods and services. This definition clearly brings out that it is not just the buying of goods/services that receives attention in consumer behavior but, the process starts much before the goods have been acquired or bought. A process of buying starts in the minds of the consumer, which leads to the finding of alternatives between products that can be acquired with their relative advantages and disadvantages. This leads to internal and external research. Then follows a process of decision-making for purchase and using the goods, and then the post purchase behavior which is also very important, because it gives a clue to the marketers whether his product has been a success or not.

“Why do some companies perform more profitably than others, even though they compete for the same customers, have to pay the same wages, and are subject to the same regulations? One major reason commonly advanced is that some companies are better than others at developing products and services in which their customers see a high value relative to competing products and relative to the price”(Blois and Grunert, 2000). [1] Developing products in which customers will see a high value requires, in turn, a good understanding of customers, what they want, how they buy, what determines whether they will be satisfied with a product or service. A company that continuously tries to understand its customers and uses that knowledge in developing products and services is also said to be market oriented. It has been shown that companies that are more market oriented are generally more profitable.

Researchers in marketing have studied most areas of consumer behavior including the impact of everything from music to lighting on how people behave and how they consume products. This is not surprising while considering the fact that we live in a consumption-drives culture. Also the factors influencing consumer behavior must be considered as well as similar factors influencing the buying decisions in business to business transactions. On this paper, we are going to discuss the underlying benefits that consumers look when purchasing a car and determine customers’ expectations on the product, and how to generate the segmentation of target customers to be able to differentiate between both genders’ prospective and attitudes.

2. Literature Review

2.1. Consumer Buying Behavior

The decision processes and acts of final household consumers associated with evaluating, buying, consuming, and discarding products for personal consumption.

Consider the purchase an automobile. You generally will not consider different options until some event triggers a need, such as a problem needing potentially expensive repair. Once this need has put you “on the market”, you begin to ask your friends for recommendations regarding dealerships and car models. After visiting several dealerships, you test drive several models and finally decide on a particular model. After picking up your new car, you have doubts on the way home, wondering if you can afford the monthly payments, but then begin to wonder if instead you should have purchased a more expensive but potentially more reliable model. Over the next five years, the car has several unexpected breakdowns that lead you to want to purchase a different brand, but you have been very happy with the services of the local dealership and decide to again purchase your next car there (Palmer, 2000) [1] .

In this particular case, the following generic model of consumer decision making appears to hold:

In the problem recognition phase, the consumer sees a big difference of his current state and ideal state. The consumer realizes there is a problem which needs to be solved. In our paper, Assume that, consumer realizes that he wants a car for his daily transportation. The reasons are probably he moves to countryside from the city center and he needs driving the car from his new home to his office or probably he is not satisfied with his current car’s status, for example, probably the design is too out of date.

Once a problem is recognized, the consumer enters into the information search phase. Consumers need right information to help him/her solve the problem. Information search is the process by which the consumer investigates his/her environment for right data to make a reasonable decision. Information sources include two types: internal search and external search. Internal search involves a scan of information stored in memory to recall past experiences or knowledge regarding purchase alternatives. External search involves going outside sources to acquire information such as personal sources, marketer controlled sources, public sources, or through personal experiences such as examining or handling a product. In our study, the internal search may mean the different car models in the consumer’s mind. For the external search, it may include the car advertisements, car makers’ websites, dealers’ introduction and friends and relative.

The third stage is the evaluation of alternatives stage. Consumers are faced with different options and they have to narrow down different options and choose one of the options as the final one. The alternatives actively considered during a consumer’s choice process are his evoked set. The evoked set includes those products already in memory, plus those prominent in the retail environment. For example, in our study, consumer probably didn’t know much about cars, especially the technical aspects of cars, so probably he had only considered a few major Japanese brands in his memory because he thinks Japanese brands represents value for money and good quality. If a company’s product is not included in the list of alternatives or if information about the product is not available to the customer, there is no opportunity to compete actively for the potential business. 36It is not impossible to change a customer’s evaluation but it is very difficult. Therefore the key to good marketing, according to (Dongyon and Xuan, 2008 ) [1] , is to understand the evaluation criteria used by the customer as well as the strengths and weaknesses of the competitors.

After the related alternatives from a category have been considered and evaluated, a choice would be made. Based on the decision, the customer will thereafter make the purchase decision and actually buy the product. The customer’s decision is based partly on the quality and price of the product and partly on the policies and procedures of the company.

When consumer was looking at different cars, he focused on one or two Japanese brands he is familiar with and ignored other brands. Consumer narrowed down his choices by only considering two specific brands. Evaluative criteria and determinant attributes are used. Evaluative criteria are the dimensions used to judge the merits of competing options. When comparing with alternative options, the consumer could chose cars equipped with night vision and navigation which he thinks could be useful for his leisure trip to countryside, so night vision and navigation are considered as evaluative criteria. Cars without night vision and navigation will not be on the consumer choices list. Another important point is that criteria on which products differ from one another carry more weight in the decision process than do those where the alternative are similar.

Finally, there is a post-purchase stage where the customer evaluates the product and its usefulness based on their expectations of the product. A satisfied customer sends positive messages or talks favorably to his friends or family members about the product. The satisfied customer will purchase other products from that company or will repeat purchasing the product in the future. Marketers could understand how to build brand loyalty and how to encourage favorable word-of-mouth communication by learning the post-purchase stage (Palmer, 2000) [1] .

2.1.1. Factors Influencing the Buyer Behavior

Consumer behavior is affected by many uncontrollable factors. Just think, what influences you before you buy a product or service? Your friends, your upbringing, your culture, the media, a role model or influences from certain groups.

‘Culture’ is one factor that influences behavior. Simply culture is defined as our attitudes and beliefs. But how are these attitudes and beliefs developed? As an individual growing up, a child is influenced by their parents, brothers, sister and other family member who may teach them what is wrong or right. They learn about their religion and culture, which helps them develop these opinions, attitudes and beliefs. These factors will influence their purchase behavior however other factors like groups of friends, or people they look up to may influence their choices of purchasing a particular product or service. ‘Reference groups’ are particular groups of people some people may look up towards too that have an impact on consumer behavior. ‘Opinion leaders’ are those people that you look up to because your respect their views and judgments and these views may influence consumer decisions (Proctor, 2000) [2] .

2.1.2. Perception

Our perception is an approximation of reality. Our brain attempts to make sense out of the stimuli to which we are exposed.

Several sequential factors influence our perception. Exposure involves the extent to which we encounter a stimulus. Most of this exposure is random; we don’t plan to seek it out. Exposure is not enough to significantly impact the individual, at least not based on a single trial In order for stimuli to be consciously processed, attention is needed. Interpretation involves making sense out of the stimulus. Weber’s Law suggests that consumers’ ability to detect changes in stimulus intensity appear to be strongly related to the intensity of that stimulus to begin with.

Several factors influence the extent to which stimuli will be noticed. One obvious issue is relevance. Consumers, when they have a choice, are also more likely to attend to pleasant stimuli (but when the consumer can’t escape, very unpleasant stimuli are also likely to get attention, thus, many very irritating advertisements are remarkably effective). Surprising stimuli are likely to get more attention wand survival instinct requires us to give more attention to something unknown that may require action. A greater contrast occurs in the difference between stimuli and its surroundings as well as greater prominence (e.g. greater size, center placement) also tend to increase likelihood of processing.

With better understanding of customer’s perceptions, companies can determine the actions required to meet the customer’s needs. They can identify their own strengths and weaknesses, where they stand in comparison to their competitors, chart out the path future progress and improvement. Customer satisfaction measurement helps to promote an increased focus on customer outcomes and stimulate improvements in the work practices and processes used within the company (Dongyan & Xuan, 2008) [1] .

2.1.3. Attitude

Consumer attitudes are a composite of a consumer’s beliefs about, feelings about and behavioral intentions toward some object within the context of marketing, usually a brand or retail store. These components are viewed together since they are highly interdependent and together represent forces that influence how the consumer will react to the object.

Consumers also hold certain feelings toward brands or other objects. Sometimes these feelings are based on the beliefs, e.g., a person feels nauseated when thinking about a hamburger because of the tremendous amount of fat it contains, but there may also be feelings which are relatively independent of beliefs. The behavioral intention is what the consumer plans to do with respect to the object, e.g., buy or not buy the brand. As with affect, this is sometimes a logical consequence of beliefs or affect, but may sometimes reflect other circumstances.

Changing attitudes is generally very difficult, particularly when consumers suspect that the marketer has a self-serving agenda in bringing about this change, e.g., to get the consumer to buy more or to switch brands.

Changing Affect; one approach is to try to change affect, which may or may not involve getting consumers to change their beliefs. One strategy uses the approach of classical conditioning try to pair the product with a liked stimulus. Finally, products which are better known, through the mere exposure effect, tend to be better liked, that is, the more a product is advertised and seen in stores, the more it will generally be liked, even if consumers to do not develop any specific beliefs about the product.

Changing Behavior; people like to believe that their behavior is rational; thus, once they use our products, chances are that they will continue unless someone is able to get them to switch. One way to get people to switch to one brand is to use temporary price discounts and coupons; however, when consumers buy a product on deal, they may justify the purchase based on that deal (the low price) and may then switch to other brands on deal later. A better way to get people to switch to our brand is to at least temporarily obtain better shelf space so that the product is more convenient. Consumers are less likely to use this availability as a rationale for their purchase and may continue to buy the product even when the product is less conveniently located.

Changing beliefs; Although attempting to change beliefs is the obvious way to attempt attitude change, particularly when consumers hold unfavorable or inaccurate ones, this is often difficult to achieve because consumers tend to resist. Several approaches to belief change exist:

Change currently held beliefs; it is generally very difficult to attempt to change beliefs that people hold, particularly those that are strongly held, even if they are inaccurate.

Change the importance of beliefs.

Add beliefs; Consumers are less likely to resist the addition of beliefs so long as they do not conflict with existing beliefs.

Change ideal; It usually difficult, and very risky, to attempt to change ideals, and only few firms succeed (Palmer, 2000) [1] .

2.1.4. Motivation

People considered several perspectives on behavior as a way to understand what motivates the consumer. Each of these perspectives suggests different things as to what the marketer should do and what can and cannot be controlled. The Hard Core Behavioral perspective is based on learning theories such as operant and classical conditioning. These theories suggest that consumers must learn from their own experiences rather than merely observing other people who overeat and get sick.

The Social Learning Perspective, in contrast, allows for vicarious learning i.e., learning obtained by watching others getting good or bad consequences for behavior. The models that may be observed and imitated include peers and family members as well as relevant others that may be observed in advertising. Certain people are more likely to be imitated than others. Generally, observations are made of overt behavior, but some room is made for individual reasoning in learning from others. This perspective is clearly more realistic than that of the Hard Core view.

The Cognitive approach emphasizes consumer thinking rather than mere behavior. Here, the emphasis is on how people reason themselves to the consequences of their behavior. It is often somewhat more difficult to attempt to get into a consumer’s head than it is to merely observe his or her behavior, and what we observe is somewhat more subjective.

The Biological approach suggests that most behavior is determined by genetics or other biological bases. By this perspective, it is suggested that consumers eat the foods they eat in large part because the body craves these foods. The main implication of biological determinism is that the marketer must adapt, for example, food advertisements are more likely to be effective when people are hungry, and thus they might better be run in the late afternoon rather than in the late morning (Blois & Grunert, 2000) [1] .

Involvement; it has to do with an individual’s intensity of interest in a product and the importance of the product for that person.

The purchase of a car is much more risky than the purchase of a quart of orange juice, and therefore presents a higher involvement situation. This modifies the way that the generic model works. As involvement increases, consumers have greater motivation to comprehend and elaborate on information salient to the purchase. A life insurance agent, for example, would typically be more interested in contacting a young couple who just had a baby than an eighteen year old college student – even though the new parents might be struggling to make ends meet while the student is living more comfortably. Although the annual investment into a policy is much lower if started at a younger age, most young college students are not open to thinking about long term estate planning. A young couple with a new child, however, is much more open to thinking about issues associated with planning for the child’s future education, saving to buy a house, or even saving to take an extended vacation upon retirement.

The automobile industry today is the most profitable industry. Due to the increase in disposable income in both rural and urban sector and easy finance being provided by all the financial institutes, the passenger car sales have increased rapidly over the corresponding period in the previous year. Further competition is heating up in the sector with a host of new players coming in and others like Porches, Mercedes, Audi, and BMW all set to venture in Egyptian Market. One factor that could help the companies in the marketing of their products is buying behavior of the consumers. The buying behavior of the customers can be studied by knowing their perceptions about the cars in the market and about the possible entrants in the market. One such technique is by knowing and creating a personality for the brands. So marketers will have to constantly monitor and understand the underlying demographics and psychographics to map their respective industries are moving and decide what needs to be done, by way of adding value that motivates customers to buy the company’s products and influence the future industry structure (Blois & Grunert, 2000) [1] .

2.2. Development of Car Market

According to the new technology that is developing nowadays, customer attitude towards cars has been changing for the car companies, and they have to serve these new challenges to gain customer satisfaction and fulfill his needs. The car marketers are now growing all over the world other than past years, and they are evaluating and analyzing the new car buyers’ needs and wants. They found that the consumer’s basic needs while thinking of a car are comfort, luxury, safety, economy, performance and convenience. Also we can’t neglect the role of marketers on understanding how culture has an impact on the car marketing in relation to consumer buying process, and the demand of the product is different from country to another, so marketers should take this into consideration when studying the consumer buying behavior. The segmentation is really important to be created in order to reach the selected target customer in the target market (Nath, 2009) [2] .

2.2.1. The Uses of Demographics and Lifestyle Segmentation

Many marketers use the word segmentation and translate it into “Demographics” only, and this is really a wrong concept to be followed in order to create an effective target customers. The word segmentation is classified into different types which are; demographics, lifestyle, psychographics, behavioral, geographic, and usage. On this paper, we will concentrate on demographic and lifestyle and see the uses of each one. The demographic segmentation concerned on age, gender, occupation, social class …etc, the mistake that marketers do is concentrating on one type of demographics such as age, for instance. This wrong concept cause lack richness of information which lead to the declining of the product life cycle. So, in order to have a good study and evaluation on consumers, marketers should gather all the information needed in the demographic segment to obtain a more clear insight of the audience’s characteristics.

Life style segmentation, people understand it as “how the person lives, buys, and uses the product”. It can be defines as the total image the individual has of himself by expressing his self concept. It is also a good concept for having a good advertising plan because it elaborates the story life of the target customer which will make it easier to identify the advertising image successfully. According to the researchers’ point of view, they detected that needs and desires are being created by life styles, and life styles are one of the major concepts that affects the purchasing power and the buying behavior of consumers. Relating to cars, marketers can be supported with the life style analysis to be able to understand the relationship between consumer’s life styles and the product or service they sell. The life style of people who use cars can be measured using to the following questions;

1) What are their demographic characteristics?

2) What are their interests and how do they spend their time?

Mainly we can say that the basic idea of life style is like what Nath (2009, p.2) [1] stated in his research which is:

“The more marketers know and understand about their customers, the more effectively they can communicate with and serve them”.

2.2.2. Consumer Behavior on Luxury Cars

In the last seven years, the demand of luxury car markets is increasing with the growth of technology, and this permanent changing affects our daily life and our demands too. Marketers try to understand the different needs of consumers then understand the different behaviors on the purchasing process, and this requires studying the internal and external environment that is formulated for their marketing plan in order to be differentiated in the field and increase the market share other than the competitors. It is obvious that competition is growing as a result of these developments, and this shows the role of brand identity to beat the competition. The perceived car image is the key of success in the buying decision, large companies such as Mercedes-Benz and BMW need to be updated with all the changing of social value to develop their attributes and categories on their brands, and this leads to the saturation of their positions of the global market (Anurit et al, n.d.) [1] .

A process of buying starts in the minds of the consumers which lead to the finding of alternatives between products that can be acquired with their relative advantages and disadvantages. This aspect applies on cars; the marketers study the consumer’s life and understand his needs in order to beat the competition because now the luxury car market is expanding in a high speed and according to this heavy competition, marketers are forced to be differentiated as possible as they can to exceed the market over the competitors.

Few authors determined the customer perceptions of luxury cars and they were concerned in consumer loyalty and brand switching. So marketers use the promotional tools to maintain customer relation, increase their loyalty and brand switching. The authors’ researches were focused on the segmentation of low price car ranges, regarding the segmentation of luxury cars, and how to choose between the brand image and the choice of buyers. Unfortunately they found that marketers neglect customers’ differences attitudes and perceptions towards automobile which affects the buying decision.

Studying the buying behavior of luxury cars is really different for marketers rather than the lower segmented cars. Now marketers are on the spot, so they need to understand well their target customers, their lifestyles, their attitudes, and their perspectives on the luxury cars. They should also study their loyalty level towards their present brand, and how to operate and convince them to switch to your brand. This can be by presenting the advantages of car that differentiate it over the others, then marketer can use the promotion tools to play on his psychological side by letting him test drive the car to be more convinced and also to increase the customer’s credibility. Also marketer can do a special promotion for the customer to show him how the company specialize their customers rather than the others (Anurit et al., n.d.) [1] .

2.3. Understanding Women

2.3.1. Women Buying Behavior

Women are the most profitable customers in the cars industry rather than men because they are involved in two dimensions: loyalty and referrals. First, the demand of women are higher than men while doing prime purchase in any category, they spend most of their time being loyal to their chosen brand, and the role of marketers here is to maintain the customer relationship by sending invitations on a special event, improving the after-sale-services to satisfy them and increase their loyalty. Second, the role of word-of-mouth appeared, although women are satisfied and loyal to the brand, they will recommend to other that this brand is favorably impressive. When the marketer reaches women’s satisfaction, he is successfully targeted both men and women because he will over fulfill the demands for men as we discussed before. So we see that marketing to women delivers a better return on marketing through higher customer acquisition and greater customer retention (Barletta, 2003) [2] .

2.3.2 The Characteristics of Women in the Market

There are some ways in which the women’s market wields a big stick. They provide some perspective on how much women earn and own, and they cast light on how women spend.

Earning Power – What’s In Her Wallet?

On average, women are earning a whole lot more money than they used to. Over the next two decades we will see the immense assets of two generations become increasingly concentrated in the hands of baby boomer women. What that means is there are an existing market today and an even larger potential market that spans the next two decades.

Consumer Spending Power – Household Chief Purchasing Officer.

Retailers and packaged goods companies have known for a long time that their primary purchaser was female. What marketers haven’t caught on to yet is that women’s spending power now extends far beyond the small stuff. In the past, big-ticket items like cars, insurance policies, and major appliances were historically bought by, and therefore marketed, to men. Things have changed, nowadays; women drive the purchases even in historically male driven categories. For example:

a. Women make 53% of all investment decisions.

b. Women make 55% of all consumer electronic purchases.

c. Women make 60% of all home improvements buyers.

d. Women make 60+% of all new car purchases.

e. Women make 66% of all new computer purchases.

Women Mean Business – Controlling the Company Checkbook.

Companies that market business to business also need to pay attention, because when it comes to business buying, women play a significant role as well. Most of the purchasing managers and buyers including the wholesale and retail buyers are women. Not only do women make up the majority of the market, but they are more profitable. Marketing to women will deliver more profit to your bottom line than putting the same budget against an all-male target.

More Profitable Customers

Two dimensions of the women’s buying process make them more profitable customers than men in the long run: loyalty and referrals. First, because women are more demanding in making the initial purchase in a category, they recoup their time investment by staying more loyal to the brand they’ve chosen in subsequent purchase cycles. Second, because word of mouth is more prevalent among women, they are more likely to recommend to others those brands or salespeople that impress them favorably (Barletta, 2003) [1] .

Effectively targeting women generates higher customer satisfaction – among both women and men. Accordingly, when you meet the higher expectations of women, you are more than fulfilling the demands for men. In essence, you’ve got two satisfied customers for the price of one. Marketing to women delivers a better return on your marketing dollar through both higher customer acquisition and greater customer retention.

2.3.3. Why Market Differently to Women

When it comes to buying, women have different prospective, beliefs, attitudes, and preferences on their buying decision. In order to understand how to reach woman’s satisfaction, marketers should use gender learning to be specified and able to reach

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