Consumer Behaviour Lecture

21/1/19

What is consumer behaviour?

Study of the process involved when individuals or groups select, purchase, use or dispose of products, services, ideas or experiences to satisfy needs and desires. (Soloman et al, 2011)

Maslow’s Hierarchy of Needs

Self-actualisation needs: the desire for self-fulfilment in achieving whatever someone can

Esteem and status: striving to achieve a high standing in relation to other people

Social needs: we need social experience and desire products and services that facilitate social exchange

Safety needs: protection from the unpredictable happening in life e.g. accidents

Physiological needs: The fundamentals of survival

How does your own self-concept create influence behaviour?

Self-esteem – (Richins 1993; Kees et al., 2008)

Marketers use attractive models for a social comparison process where young female consumers compare themselves and feel inadequate against them.

…ironically when showed adverts with ‘real sized women’ the advert scored less favourably…

*This model does not really account for the influence of other people. For example, how does family affect the consumer behaviour and consumption? *

Divers and changing markets

Most fashion marketers try to attract several market segments at once e.g. GAP sells to men, women and children.

Consumer buying habits don’t remain the same. Changes in economic or social conditions can affect the consumer’s choices.

Segmenting A Market

Market segmentation is a way of analysing a market by categorising their specific characteristics.

Specific characteristics include: demographics, psychographics, geographics, behaviouristic/usage, situation, geodemographic.

·      Demographics are statistics that describe a population in terms of personal characteristics such as age, gender, income, ethnic background, education, religion, and lifestyle.

·      Psychographics are studies of consumers based on social and psychological characteristics such as attitudes, interests and opinions.

·      Geographics are statistics about where people live.

·      Behaviouristics are statistics about consumers based on their knowledge, attitudes, use, or response to a product.

Marketers may look at the purchase occasion for a product, the products benefits sought by consumers, or usage level and commitment towards a product:

·      Purchase Occasion: identifies the instance when a consumer might use a product (“after-five”, or work attire)

·      Product Benefits: identifies the benefits that consumers desire in a fashion product or service (stain-resistance or wrinkle-free)

·      Usage Level and Commitment: identifies how often they use a product and their loyalty to purchasing it (will you buy a replacement)

·      Geodemographic segmentation: hybrid segmentation: You Are Where You Live (financial means, tastes, preferences, lifestyles and consumption habits)

Targeting

The next step is targeting, in which marketers evaluate each potential segment and decide upon which groups of customers they will invest marketing resources.

·      Selected groups are known as target markets

·      How is technology making it easier for fashion firms to target potential customers?

Brand Positioning Statement

-defined as the conceptual place you want to own in the target consumer’s mind – the benefits you want them to think of when they think of your brand. An effective brand positioning strategy will maximize customer relevancy and competitive distinctiveness, in maximising brand value.

When doing research to inform a brand positioning project, you must be able to answer the following questions:

1.     What does the brand community currently believe about or value in the brand?

2.     What might the brand community believe or value about the brand in the future?

3.     What does the organisation currently claim about the brand?

4.     What would the organisation like the brand to become down the road?

The final step… Positioning?

How do you want to be seen in the market place? What is your key competitive advantage…? What do you want to highlight?

·      Product Differentiation e.g. the Lynx effect will make you more sexually attractive towards women…

·      Service Differentiation e.g. Kia offer a 7-year warranty…

·      Personnel Differentiation e.g. Apple Geniuses

Product Life Cycle

The fashion cycle: the ongoing introduction, rise, peak, decline, and obsolescence in popularity or specific styles or shapes.

All styles that come into fashion rotate through the fashion cycle.

Stage 1  – first stage of fashion cycle is when new styles, colours, textures, and fabrics are introduced.

-       The new style may be accepted by a small number of people called fashion leaders.

-       Promotional activities include fashion shows and advertising in high fashion magazines.

-       Fashions are produced in small quantities at high prices.

-       Retail buyers purchase limited numbers to see if the style will be accepted.

Stage 2 – the second stage of the fashion cycle when consumer interest grows and the fashion becomes more readily accepted by consumers.

-       Mass production brings down the price of the fashion, which results in more sales.

-       Styles are manufactured in less expensive materials and in lower quality construction than the original style.

-       Promotional efforts are increased in high fashion magazines the heighten consumer awareness.

-       Retail buyers order items in quantity.

Stage 3 – the third stage of the fashion cycle during which a style is at its height of popularity.

-       The fashion is demanded by almost everyone because it is now within the price range of most consumers and is mass produced in many variations.

-       Each retailer tries to persuade customers that its version of the style is the best.

Stage 4 – the fourth stage of the fashion cycle when the market is saturated and popularity decreases.

-       The fashion is overused and becomes dull and boring

-       As the fashion decreases in popularity, retailers mark down their prices.

-       Promotions centre around major clearance or closeout sales of the fashion.

Stage 5 – the fifth stage of the fashion cycle when the style is rejected, is undesirable at any price, is no longer worn, and is no longer produced.

-       Ends as an accepted fashion.

Extension Strategy

-       Can be defined as – a medium to long term plan for lengthening a products life cycle. It is likely to be implemented during the maturity or early decline.

-       Extension strategies include:

o   Redesigning the product – new and improved!

o   Adding an extra feature – Now with… (colour, quality, texture…)

o   Changing the packaging and advertising to appeal to a NEW market segment.

o   Providing a unique selling point (USP)