Introduction
In today's expanding global market, it is crucial to comprehend the global consumer. Marketers and consumer behaviour researchers are continuously working towards identifying these consumers and distinguishing their characteristics. Although there may be common sociological and psychological influences on consumer behaviour in Western cultures, regional consumption patterns cannot be disregarded.
Consumer behavior in the marketplace is centered on the purchase and utilization of products and services, as well as their integration into consumers' daily lives. Researchers utilize various techniques to comprehend consumer characteristics, such as descriptive classifications like demographics and psychographics. Additionally, individual consumers are members of a larger society with shared cultural values and beliefs, which can be further segmented into subcultures. Despite being part of the overarching European community, consumers from diverse European nations exhibit reg
...ional differentiations.
Marketers utilize market segmentation strategies to tailor their communications to address the diverse needs of a varied target market. Understanding consumer behavior translates into business success, as marketers who grasp their customers' desires fare better than their rivals. The key factor lies in determining the target audience and the approach to be taken. Marketers achieve this by defining markets and subsequently dividing them into smaller segments based on the demographics and psychographics of the targeted population. The consumer's response ultimately determines the efficacy of a marketing strategy.
However, initial consumer testing is not an exact science. Even if a product fails its initial test marketing, it can still become highly successful. Sony has responded to market and consumer changes by introducing its new MP3 player, which competes with the Apple iPod. Effective market segmentation involves dividing the population into smaller segments of consumers who
have unique characteristics that distinguish them from the larger population. This process of "slicing up" the market allows for the gathering of accurate information about the traits, habits, likes, and dislikes of consumers.
To ensure effective segmentation, it is essential to fulfill the following requirements: members of the identified segment should possess comparable product needs that distinguish them from consumers in other segments. It should be feasible to clearly discern significant disparities between the segments. The segment must be sufficiently sizable to generate profit, and consumers within the segment should be reachable through an appropriate marketing mix.
The consumers in the segment will respond in the desired way to the marketing mix. Two important segmentation tools are the use of demographics and psychographics to determine unique attributes of the targeted population. Demographic statistics measure the observable aspects of the population. Psychographics are far more subtle. They illustrate the differences in consumers' personalities and cannot be measured objectively.
Demographic variables include: Age - Different age groups have different needs and wants.
Consumers within the same age groups often have similar values and cultural experiences. The behaviors and preferences of men and women are continuously changing. It is believed that marketing strategy unintentionally leads to gender segmentation. Marital status and family structure are significant demographic factors that have an impact on spending priorities. People belonging to the same social class often have similar occupations and may have shared values and interests. Income is a reliable indicator of purchasing power and market potential.
Race and ethnicity: Immigrants from Asia and Africa are the fastest growing ethnic groups in Europe. Increased multiculturalism creates new opportunities for marketers.
Geography: Cultural differences play an important role in
consumption patterns. Within the European context, consumption is common across cultures, but it is also specific between different cultural groups.
European segmentation factors encompass consumption traits that are common across various cultures as well as consumption traits that are unique to specific cultural groups. Additionally, the practice of relationship marketing, which involves establishing enduring connections with consumers, is widely recognized as crucial for marketers. Understanding current and potential consumers enables marketers to enhance their effectiveness. As such, relationship marketing has evolved into a pivotal aspect of establishing long-term relationships between companies and consumers, emerging as a significant trend among marketers.
In addition to relationship marketing, there has been a significant growth in the requirement to collect and handle precise customer information. This has resulted in the development of advanced database marketing, which monitors consumer purchase patterns. Nevertheless, this idea of 'big brother is watching you' may be intimidating to certain consumers. Database marketing must adhere to respondent confidentiality constraints. As global consumers, marketers have a substantial influence on us through various methods centered around establishing relationships with customers. Advertisements demonstrate proper behavior, define roles, and provide information about product utilization.
By 2006, the majority of people will reside in urban centers. By 2015, there are expected to be 26 'megacities'. Sophisticated marketing strategies have been used to target these large markets, resulting in the emergence of a global consumer culture. This culture is characterized by a shared enthusiasm for brand-name consumer products, film stars, and music celebrities. The digital revolution has also greatly influenced consumer behavior, with the internet's power continually expanding as more individuals gain access worldwide. It is worth noting that the impact of the
web extends beyond businesses selling products directly to customers (B2C e-commerce).
The explosion of the cyberspace has brought about a revolution in consumer-to-consumer activity, known as C2C e-commerce, leading to the emergence of virtual brand communities. Close relatives of the global consumer are Euro-consumers. Much research and marketing effort focuses on identifying the characteristics of Euro-consumers. Studies show that there are connections between social class, culture, and income, indicating that consumers who have more positive attitudes towards cultural change are more likely to consume luxury goods, regardless of their demographics and social class.
Marketing Ethics
The constant challenge lies in balancing the achievement of organizational profit goals with the need to conduct business in an honest and ethical manner.
Prescribing Ethical Standards of Conduct
Organizations often create codes of conduct for their employees, while marketing associations provide guidelines for conduct. These guidelines may include a requirement to disclose the significant risks associated with a product or service.
The identification of additional features that will result in a higher cost, the prevention of false or deceptive advertising, the refusal of aggressive sales techniques, and the prohibition of selling or fundraising activities disguised as market research.
Socially Responsible Behavior Some marketers continue to violate the bond of trust with the consumer through the use of 'bait-and-switch' tactics and deceptive claims. Ethical behavior can be measured by how companies address issues with their advertising or products. Benetton stopped running controversial advertisements that depicted an AIDS victim, which were considered exploitative by consumers. Marketing techniques that persuade consumers to buy non-essential products have faced significant criticism. Philosophers examine this dilemma in terms of individuals utilizing their freedom of will and action when making choices.
However, this clinical
approach only applies when informative advertising is used in marketing communication. Any other forms of advertising, specifically those with imagery and underlying motives, cannot be rationally explained in the same way. The ongoing debate surrounding the manipulation of customers through marketing techniques is explored from three different viewpoints.
Do Marketers Generate Artificial Desires?
There are conservative traditionalists who argue that advertising can contribute to the moral decline of societies due to the pursuit of hedonistic pleasure. On the other hand, liberals believe that the false promises of material happiness are used to appease individuals who might otherwise be activists striving to change the system.
Advertising creates demands that can only be satisfied by its products, leading to various responses to this criticism. One argument is that needs are innate biological motives, and wants are society's way of teaching us how to satisfy those needs. The main goal of advertising is to raise awareness of needs, rather than creating the needs themselves. Therefore, needs are something we are socialized to have. Marketers must be aware that they significantly contribute to the socializing influence in modern society and thereby influence needs.
Many commentators argue that marketers effectively manipulate consumer purchasing decisions through their knowledge of psychology and social sciences, leading to concerns about the ethical aspects of advertising. It is widely acknowledged that advertising has a significant impact on shaping and altering consumer behavior. However, the key question is whether individuals possess enough discernment to see past the marketing tactics and make informed judgments.
Visit the PBS Frontline website on 'The Persuaders' to delve into the realm of contemporary marketers and advertisers. The website delves into their strategies for understanding our wants
and identities. Despite advertising's influence, advertisers still lack sufficient knowledge about their target audience to successfully manipulate them. This is evident from the significant rate of product failures (40-80 per cent).
The Impact of Interdisciplinary Fields on Consumer Behaviour Research
Consumer behaviour incorporates multiple fields, including psychophysiology, sociology, and anthropology.
Each discipline has its own perspective on the subject, resulting in a diverse sociological interpretation of a captivating and ever-changing topic. The figure displayed below showcases a holistic and interconnected approach to understanding consumer behavior, considering both macro and micro viewpoints. The macro perspective centers around societal factors, while the micro perspective focuses on the individual. [pic] pyramid of consumer behavior. Consumer research has embraced two prevalent research paradigms: Positivism, which values human reason and believes that objective truth is only attainable through scientific investigation; and Structured and ordered, which emphasizes functionality.
Celebrates technology and regards the world as an ordered, rational place with a clearly defined past, present, and future. Emphasizes material well-being and is predominantly based on the homogenous views of a predominantly Western and male culture. Interpretivism believes that the social and cultural world we live in is complex, and dislikes excessive emphasis on science and technology.
Emphasizing the significance of symbolic and subjective experiences, this perspective suggests that individuals construct meanings from their own unique, shared cultural experiences. As a result, there are no definitive right or wrong references. Consumption is viewed as a collection of varied experiences. Numerous experts in consumer behavior argue that the dominant positivistic paradigm of consumer behavior is currently undergoing a paradigm shift, as it faces competition from the interpretivist paradigm.
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