Marketing Intelligence Assignment 1

Assignment 1 môn Marketing Intelligence. Nhận viết thuê assignment chuyên ngành marketing bằng tiếng anh hoặc tiếng việt giá hợp lý. Liên hệ 0978936352 The author has an order to run a marketing research from a client who is CEO of Services and Entertainment NNC Company. This company opened a public house named Ress Pub and they ask me to do research about buying behavior of targeted customer. In this article, the author will have detail analysis about buying behavior in order to help CEO have overview about targeted customer’s buying behavior. To serve the research, the author will choose 10 random customers in pub and create an interview.

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Marketing Intelligence

Assignment 1

9/9/2015

Ha Hung Minh

Contents

Introduction: 2

1.1 Describe the main stages of the purchase decision-making process 3

5 main stages of the purchase decision-making process 3

Apply on Ress Pub 6

1.2 Explain theories of buyer behavior in terms of individuals and markets 7

Black box model 7

Personal variable models 8

Diffusion of innovation models 9

1.3 Explain the factors that affect buyer behavior 12

Psychological factors 12

Motivation: 12

Perception: 13

Learning: 15

Beliefs and attitudes: 15

Social factors 16

Reference groups and membership groups : 16

Family: 17

Social roles and status: 18

Cultural factors 18

Culture and societal environment: 19

Sub-cultures: 19

Social classes: 20

Cultural trends: 21

Economic factors 21

Personal Income: 21

Family income: 22

Income Expectations: 22

1.4 Evaluate the relationship between brand loyalties, corporate image and repeat

purchasing 22

Apply on Ress Pub 23

Conclusion 24

Appendix: 25

Interview 25

References: 26

Introduction:

The author has an order to run a marketing research from a client who is CEO of Services and Entertainment NNC Company This company opened a public house named Ress Pub and they ask me to do research about buying behavior of targeted customer In this article, the author will have detail analysis about buying behavior in order to help CEO have overview about targeted customer’s buying behavior To serve the research, the author will choose 10 random customers in pub and create an interview

1.1 Describe the main stages of the purchase making process

decision-Ress pub was built by businessman Pham Viet Trung –CEO of Services and Entertainment NNC Company- and opened in May, 2015 The aim was to create a place where hipsters and teenagers have a good time to relax Ress pub offer a range of beer, cocktail, mock tail, wines,

spirits, foods and DJ, live music Targeted customers of Ress pub are hipsters and teenagers;

they need to find a good place to relax, entertaining after stressful work hours Because of new pub, Ress pub has problems about marketing The author will give recommendation about buying behavior through all the models and theories in marketing intelligence; it’s very important to get the attention of targeted customers

5 main stages of the purchase decision-making process

The author will explain 5 main stages of the purchase decision-making process, and then the author will describe the purchase decision-making process through interviewers

1 Need recognition/ Problems recognition

The need recognition is the first and most important step in the buying process Needs recognition leads to motivation If there is no need, there is no purchase This recognition happens when there is a lag between the consumer’s actual situation and the ideal and desired one Based on Maslow’s hierarchy of needs, needs have 5 types: physiological needs, safety needs, need of love and belonging, need of esteem (for oneself and from the others), need of self-actualization A need can be triggered by internal and external stimuli Internal stimuli refer

to a personal perception experienced such as hunger, thirst, knowledge, lifestyle, attitudes and

so on External stimuli are based on outside influences such as advertising, social network,

situation, family, culture For example, when a person feels thirsty (internal stimuli) and he sees

advertising about beverage on TV programs (external stimuli), the need recognition will appears

to resolve the problem He needs to buy a soft drink

2 Information search

Once the need is identified, it’s time for the consumer to find information about solutions to fix the problem They will search more or less information depending on the complexity of the choices to be made but also their level of involvement There are 2 main level of involvement:

low involvement (inexpensive) and high involvement (expensive) For example, when

consumers want to buy a pizza (low involvement), they need to find less information than by a car Then consumer will seek to make their opinion to guide their choice and their decision making process with:

Internal information: this information is already present in the consumer’s memory It comes

from previous experiences they had with a product or brand and the opinion they may have of the brand In consumer’s memory constitute previous experiences about product such as

exposure, attention, comprehension, acceptance, retention For example, a consumer had buy

a bag of Converse and he feel satisfy with quality as well as the design of Converse’s bag So, he had a good experience of converse’s brand Therefore, he wants to buy a shoes and he trust about the brand of Converse And he decide buy shoe of Converse

External information: This is information on a product or brand received from and obtained by

friends or family, by reviews from other consumers or from the press There are 2 types of external information: personal (friend, family, ) and impersonal (social network, magazines,

advertise) For example, when a consumer search information to by a car, he need to get the

suggestion of the expert person who know many brand of car and have knowledge about car After that, consumer will find more information on car magazines or internet

3 Alternative evaluation

Once the information collected, consumers will be able to evaluate the different alternatives that offer to them, evaluate the most suitable to their need and choose the one they think it’s best for them This evaluation process may lead to changes in beliefs, regarding the brand which, in turn, leads to changes in attitudes and intentions to purchase The consumer arrives

at attitudes toward different brands through some evaluation procedure How consumers go about evaluating purchase alternatives depends on the individual consumer and the specific buying situation In some cases, consumers use careful calculations and logical thinking At other times, the same consumers do little or no evaluating; instead they buy on impulse and rely on intuition Sometimes consumers make buying decisions on their own; sometimes they

turn to friends, online reviews, or salespeople for buying advice For example,

4 Purchase decision

Now that consumer have evaluated the different solutions and products available for respond

to their need, they will be able to choose the product or brand that seems most appropriate to their need Then proceed to the actual purchase itself

Consumer’s decision will depend on the information and the selection made in the previous step or affected by such things as their previous shopping experience

The decision also affect by unexpected situational The consumer may form a purchase intention based on factors such as expected income, expected price, and expected product

benefits However, unexpected events may change the purchase intention For example, the

economy might take a turn for the worse; a close competitor might drop its price Thus, preferences and even purchase intentions do not always result in actual purchase choice

5 Post-purchase behavior

Once the product is purchased and used, consumers will evaluate the adequacy with their expectation original needs (those who caused the buying behavior) Whether they have made the right choice in buying this product or not; they will feel either a sense of satisfaction for the product (and the choice) If the product has brought satisfaction to consumers, they will minimize stages of information search and alternative evaluation for their next purchases

Apply on Ress Pub

Stage 1 – Need recognition: In a Saturday night, some teenagers need to hang out in order to

meet friend and relax with a cup of beer (internal stimuli, lifestyle) Another people need to find

a place because of heavy rain when they are going on the street (external stimuli, situation) Some kind of people just feeling hungry but they are run out of money and they need to find a free meal (physiological needs in Maslow’s hierarchy)

Stage 2 – Information search: Teenagers already have known a pub in Ta Hien Street and they

went to this pub last week (internal information) However, a friend recommended Ress Pub because he wants to find a new place to entertaining (external information from environment) People who need shelter because of heavy rain just find first place that they can see People who are hungry known Ress Pub have event Free BBQ on Saturday (knowledge)

Stage 3 – Alternative evaluation: Group of teenagers has bad opinions of the pub in Ta Hien

Street because music and beer were not good As for the Ress Pub, it got good reviews People who are shelter because of heavy rain have not another choice People who are hungry evaluate Ress Pub is the best choice

Stage 4 – Purchase decision: After evaluating the possibilities, all group decided to choose the

Ress Pub However, if rains are not heavy, people who are shelters will not go to Ress Pub

Stage 5 – Post-purchase behavior: Teenagers group and people who are hungry had a good

time with friends and they really love fresh beer, free meals of Ress Pub They will choose Ress Pub for the next Saturday (next purchase behavior) They also rate high-score for Ress pub on Facebook, its mean they are volunteer to advertising Ress Pub to another people However, people who need to shelter were uncomfortable, they did not like the style of Ress Pub and music was so noisy

1.2 Explain theories of buyer behavior in terms of individuals and markets

Black box model

The black box model of consumer behavior identifies the stimuli responsible for buyer behavior The black box model shows the interaction of stimuli, consumer characteristics, decision process and consumer responses

It can be distinguished between interpersonal stimuli (between people) or intrapersonal stimuli (within people)

The black box model is related to the black box theory of behaviorism, where the focus is not set on the processes inside a consumer, but the relation between the stimuli and the response

of the consumer The marketing stimuli are planned and processed by the companies, whereas the environmental stimuli are given by social factors, based on the economic, political and cultural circumstances of a society The buyer's black box contains the buyer characteristics and the decision process, which determines the buyer's response

The black box model considers the buyer's response as a result of a conscious, rational decision process, in which it is assumed that the buyer has recognized the problem However, in reality many decisions are not made in awareness of a determined problem by the consumer

Personal variable models

Unlike the black box model, where external stimuli are the main focus, the personal variable model is internal factors affect consumer behavior and purchasing decisions This model specifically ignores external stimuli, such as marketing techniques, and concentrates on internal psychological variables These variables include lifestyle, motivations, and personality It also looks at individual decision-making processes, such as problem recognition, alternative evaluation, as well as post-purchase behavior

Examples of personal variable models:

Compensatory or trade-off model: When faced with a choice between products

composed or certain attributes or benefits in different proportions, a consumer will compromise on his image of the ideal product, and accept less of one attribute in return for more of another This is a judgment about which combination of attributes offers the highest overall utility, or value

The threshold model: For each perceived attribute of a product, there is a perceived

threshold of acceptability, below which product will be rejected Each attribute is assessed, until the product falls short on one (usually price) and is discarded

Diffusion of innovation models

Diffusion is the process by which an innovation is communicated through certain channels over time among the members of a social system Diffusion is a special type of communication concerned with the spread of messages that are perceived as new ideas

An innovation, simply put, is “an idea perceived as new by the individual.” An innovation is an idea, practice, or object that is perceived as new by an individual or other unit of adoption The characteristics of an innovation, as perceived by the members of a social system, determine its rate of adoption

The four main elements in the diffusion of new ideas are: The characteristics of the

innovation; the channels of communication used; the social system within which communication takes place; the stages of the adoption process reached by members of the social system

The characteristics of the innovation

The innovation, to spread and be adopted should show:

The characteristics which determine an innovation's rate of adoption are:

Relative advantage: is the degree to which an innovation is perceived as better than the idea it

supersedes The degree of relative advantage may be measured in economic terms, but social prestige, convenience, and satisfaction are also important factors It does not matter so much if

an innovation has a great deal of objective advantage What does matter is whether an individual perceives the innovation as advantageous The greater the perceived relative advantage of an innovation, the more rapid its rate of adoption will be

Compatibility: is the degree to which an innovation is perceived as being consistent with the

existing values, past experiences, and needs of potential adopters An idea that is incompatible with the values and norms of a social system will not be adopted as rapidly as an innovation that is compatible The adoption of an incompatible innovation often requires the prior

adoption of a new value system, which is a relatively slow process

Complexity: is the degree to which an innovation is perceived as difficult to understand and

use Some innovations are readily understood by most members of a social system; others are more complicated and will be adopted more slowly New ideas that are simpler to understand are adopted more rapidly than innovations that require the adopter to develop new skills and understandings

Trial ability: is the degree to which an innovation may be experimented with on a limited basis

New ideas that can be tried on the installment plan will generally be adopted more quickly than innovations that are not divisible An innovation that is trial able represents less uncertainty to

the individual who is considering it for adoption, who can learn by doing

The channels of communication used

Communication is the process by which participants create and share information with one another in order to reach a mutual understanding A communication channel is the means by which messages get from one individual to another Mass media channels are more effective in creating knowledge of innovations, whereas interpersonal channels are more effective in forming and changing attitudes toward a new idea, and thus in influencing the decision to adopt or reject a new idea Most individuals evaluate an innovation, not on the basis of

scientific research by experts, but through the subjective evaluations of near-peers who have adopted the innovation

The social system within which communication takes place

The third main element in the diffusion of new ideas is the social system A social system is defined as a set of interrelated units that are engaged in joint problem-solving to accomplish a common goal The members or units of a social system may be individuals, informal groups, organizations, and/or subsystems The social system constitutes a boundary within which an innovation diffuses How the system's social structure affects diffusion has been studied A second area of research involved how norms affect diffusion Norms are the established behavior patterns for the members of a social system A third area of research has had to do with opinion leadership, the degree to which an individual is able to influence informally other individuals' attitudes or overt behavior in a desired way with relative frequency A change agent

is an individual who attempts to influence clients' innovation-decisions in a direction that is deemed desirable by a change agency

The stages of the adoption process reached by members of the social system

There are five adopter categories, or classifications of the members of a social system on the basis on their innovativeness:

Innovators – 2.5% are the first 2.5 percent of the individuals in a system to adopt an

innovation This interest in new ideas leads them out of a local circle of peer networks and into more cosmopolite social relationships Communication patterns and friendships among a clique

of innovators are common, even though the geographical distance between the innovators may

be considerable Thus, the innovator plays a gatekeeping role in the flow of new ideas into a system

Early adopters – 13.5% are a more integrated part of the local system than are innovators

Whereas innovators are cosmopolites, early adopters are localities This adopter category, more than any other, has the greatest degree of opinion leadership in most systems The early

adopter decreases uncertainty about a new idea by adopting it, and then conveying a subjective evaluation of the innovation to near-peers through interpersonal networks

Early majority – 34% the early majority adopt new ideas just before the average member of a

system The early majority interacts frequently with their peers, but seldom holds positions of opinion leadership in a system The early majority's unique position between the very early and the relatively late to adopt makes them an important link in the diffusion process They follow with deliberate willingness in adopting innovations, but seldom lead

Late majority – 34% the late majority adopt new ideas just after the average member of a

system Like the early majority, the late majority make up one-third of the members of a system Their relatively scarce resources mean that most of the uncertainty about a new idea must be removed before the late majority feel that it is safe to adopt

Laggards – 16% Laggards are the most locality in their outlook of all adopter categories; many

are near isolates in the social networks of their system The point of reference for the laggard

Motivation is what will drive consumers to develop a purchasing behavior It is the expression

of a need is which became pressing enough to lead the consumer to want to satisfy it It is usually working at a subconscious level and is often difficult to measure

Motivation is directly related to the need and is expressed in the same type of classification as defined in the stages of the consumer buying decision process