Consumer Roles in Consumer Roles in Marketing Marketing

CommunicationsCommunicationsObjectiveObjective: : Introducing and discussing the Introducing and discussing the

significance of consumer behavior and significance of consumer behavior and motivations in communications in tourism and motivations in communications in tourism and

hospitality.hospitality.

Consumer Buying Consumer Buying BehaviorBehavior

Consumer buying behaviorConsumer buying behavior refers to the refers to the buying behavior of the individuals and buying behavior of the individuals and households who buy goods and services households who buy goods and services for personal consumption. for personal consumption.

Consumer marketConsumer market refers to the refers to the combination of all these individuals and combination of all these individuals and households.households.

These diverse consumers make their These diverse consumers make their choices among various products based on choices among various products based on several factors. several factors.

Model of Consumer Model of Consumer BehaviorBehavior

How do consumers respond to How do consumers respond to various marketing efforts that the various marketing efforts that the company might use? The company company might use? The company that understands how consumers will that understands how consumers will respond to product features, prices, respond to product features, prices, advertising has a great advantage advertising has a great advantage over its competitors.over its competitors.

According to the “According to the “model of buyer model of buyer behaviorbehavior”, marketing (4Ps) and other”, marketing (4Ps) and other

macro macro environmental environmental ((economic, economic, technological, political and cultural) technological, political and cultural) stimulus starts the response model. stimulus starts the response model. All these enter into the buyer’s head All these enter into the buyer’s head (black box) and then turn into (black box) and then turn into responses as product choice, brand responses as product choice, brand choice, dealer choice, purchase choice, dealer choice, purchase timing, and purchase amount.timing, and purchase amount.

The The buyer behavior is affected bybuyer behavior is affected by; (1) ; (1) the buyer’s characteristic - cultural, the buyer’s characteristic - cultural, social, personal, psychological; (2) social, personal, psychological; (2) the buyer’s decision process.the buyer’s decision process.

Model of Buyer BehaviorModel of Buyer Behavior

Marketing &Marketing &

Other StimuliOther Stimuli Buyer’s Black BoxBuyer’s Black Box Buyer’s ResponseBuyer’s Response

ProductProduct EconomicEconomic BuyerBuyer

PricePrice TechnologicalTechnological characteristiccharacteristic

PlacePlace PoliticalPolitical Buying Buying

PromotionPromotion CulturalCultural decisiondecision

processprocess

Product choiceProduct choice

Brand choiceBrand choice

Dealer choiceDealer choice

Purchase timingPurchase timing

Purchase amountPurchase amount

Roles of ConsumersRoles of Consumers Included in the 4Ps, consumer behavior is Included in the 4Ps, consumer behavior is

affected by marketing communications.affected by marketing communications. Consumers are influenced by media Consumers are influenced by media

representations and messages; based on representations and messages; based on how they interpret and evaluate how they interpret and evaluate information. information.

Consumers may react in different ways to Consumers may react in different ways to certain types of messages or media certain types of messages or media channels or sources. Therefore, channels or sources. Therefore, companies need to research to understand companies need to research to understand what forms of communication work best what forms of communication work best and produce the desired results. and produce the desired results.

However, this is not an easy process as However, this is not an easy process as marketing communications are delivered marketing communications are delivered in an integrated fashion. in an integrated fashion.

Consumers are aware of products or Consumers are aware of products or brands through various forms of brands through various forms of communications including advertising, communications including advertising, sponsorship, public relations, word-of-sponsorship, public relations, word-of-mouth, exposure to places through film mouth, exposure to places through film and television, etc. and television, etc.

As a result, it is difficult to evaluate how, As a result, it is difficult to evaluate how, where, when a person becomes familiar where, when a person becomes familiar with a brand, organization, destinations, ...with a brand, organization, destinations, ...

In addition, consumers themselves In addition, consumers themselves actively buy into or identify with actively buy into or identify with certain brands, images, or certain brands, images, or organizations. organizations.

Modern consumers often act as Modern consumers often act as advocates for certain products, advocates for certain products, places, brands, and so on. places, brands, and so on.

Consumer Behavior Consumer Behavior TheoryTheory

Consumer beavior theory is based on Consumer beavior theory is based on the discipline of psychology. the discipline of psychology.

Accordingly, consumers are Accordingly, consumers are perceived as rational beings whose perceived as rational beings whose buying choices are directed to buying choices are directed to satisfy a need. satisfy a need.

Different paradigms in consumer Different paradigms in consumer behaviour; behaviour; The cognitive approachThe cognitive approach: recognizes : recognizes

puchases as problem-solving decisionspuchases as problem-solving decisions The reinforcement approachThe reinforcement approach: recognizes : recognizes

consumption as learned behaviorconsumption as learned behavior HabitHabit: recognizes routine production of : recognizes routine production of

behavior for particular purchases.behavior for particular purchases. While the first has a cognitive While the first has a cognitive

perspective, the last two have perspective, the last two have behaviourist perspectives. behaviourist perspectives.

The Cognitive ParadigmThe Cognitive Paradigm

Focuses on consumer decision making Focuses on consumer decision making process involving process involving need arousalneed arousal information processinginformation processing brand evaluationbrand evaluation purchasepurchase Post-purchase evaluationPost-purchase evaluation

Does not explain repeat-buying Does not explain repeat-buying behavior, spontaneous or impulsive behavior, spontaneous or impulsive “walk-by” decisions.“walk-by” decisions.

Need Need RecognitionRecognition

The buying process starts when the buyer The buying process starts when the buyer recognizes that he has a problem or need.recognizes that he has a problem or need.

The need can be felt because of internal The need can be felt because of internal stimuli (hunger, thirst...) or external stimuli stimuli (hunger, thirst...) or external stimuli (the buyer may feel hungry when he passes by (the buyer may feel hungry when he passes by a bakery, the buyer may need to have a a bakery, the buyer may need to have a vacation when he watches a commercial about vacation when he watches a commercial about Caribbeans on TV).Caribbeans on TV).

At this stage, the marketer must identify the At this stage, the marketer must identify the factors that most trigger interest in the factors that most trigger interest in the product and develop marketing programs that product and develop marketing programs that involve these factors.involve these factors.

Information SearchInformation Search

When the consumer feels his need, he When the consumer feels his need, he satisfies his need with a product near at satisfies his need with a product near at hand. But, if there is not such a hand. But, if there is not such a product, he starts to search for product, he starts to search for information. information.

The consumer can obtain information The consumer can obtain information from several sources;from several sources; personal sourcespersonal sources: family, friends, : family, friends,

neighbors, acquaintances (more important neighbors, acquaintances (more important for the consumer to evaluate)for the consumer to evaluate)

commercial sourcescommercial sources: advertising, : advertising, salespeople, dealers, packaging, displays salespeople, dealers, packaging, displays (more important for the consumer to get (more important for the consumer to get information)information)

public sourcespublic sources: mass media, consumer : mass media, consumer rating organizationsrating organizations

experiential sourcesexperiential sources: handling, examining, : handling, examining, using the productusing the product

Here, the marketer is responsible to Here, the marketer is responsible to identify the consumer’s sources of identify the consumer’s sources of information and their importance, then information and their importance, then design its marketing efforts in the way design its marketing efforts in the way that would increase the awareness and that would increase the awareness and knowledge of the potential consumers.knowledge of the potential consumers.

Evaluation of AlternativesEvaluation of Alternatives

After gathering information, the After gathering information, the consumer evaluates each alternative consumer evaluates each alternative and makes a brand choice. and makes a brand choice.

Consumers pay attention to certain Consumers pay attention to certain issues when evaluating the alternatives;issues when evaluating the alternatives; product attributesproduct attributes: consumers see products : consumers see products

as a bundle of product attributes (e.g. as a bundle of product attributes (e.g. quality, size, price...) Consumers pay the quality, size, price...) Consumers pay the most attention on the attributes that most attention on the attributes that satisfies their need the most. satisfies their need the most.

degrees of importancedegrees of importance: consumers give : consumers give different degrees of importance to different different degrees of importance to different attributes according to their needs and attributes according to their needs and wants.wants.

brand beliefsbrand beliefs: consumers develop a set of : consumers develop a set of brand beliefs about where each brand brand beliefs about where each brand stands on each attribute. The set of beliefs stands on each attribute. The set of beliefs that are held about a particular brand is that are held about a particular brand is known as the known as the brand imagebrand image. .

total product satisfactiontotal product satisfaction: consumers : consumers combine the attributes that give them the combine the attributes that give them the highest perceived satisfaction and create highest perceived satisfaction and create their ideal product.their ideal product.

evaluation procedureevaluation procedure: consumers approach : consumers approach different brands through some type ofdifferent brands through some type of

evaluation procedure which depends evaluation procedure which depends on the individual and specific buying on the individual and specific buying situation. In some cases, consumers situation. In some cases, consumers use use logical thinkinglogical thinking, and at other , and at other times, times, emotionalemotional. Sometimes, they . Sometimes, they may decide on their own, or ask their may decide on their own, or ask their friends, or salespeople for advice.friends, or salespeople for advice.

Here, the marketer should study Here, the marketer should study the buyers to understand how they the buyers to understand how they evaluate each alternative - e.g. evaluate each alternative - e.g. which attribute receives the which attribute receives the highest attention. highest attention.

Purchase DecisionPurchase Decision

The consumer ranks all the brands and intends The consumer ranks all the brands and intends to purchase one. However, sometimes the to purchase one. However, sometimes the consumer does not buy the one he intended. consumer does not buy the one he intended. Two factors can come between the purchase Two factors can come between the purchase intention and decision;intention and decision; attitudes of othersattitudes of others; e.g. family may claim that the ; e.g. family may claim that the

alternative is better.alternative is better. unexpected situational factorsunexpected situational factors; unexpected events ; unexpected events

may change the purchase intention e.g. the consumer may change the purchase intention e.g. the consumer may loose his job so that he have to purchase a may loose his job so that he have to purchase a cheaper brand, a friend my report his dissatisfaction cheaper brand, a friend my report his dissatisfaction about the product, a competitor may drop its prices...about the product, a competitor may drop its prices...

Postpurchase BehaviorPostpurchase Behavior

After purchasing the product, the After purchasing the product, the consumer will be satisfied or consumer will be satisfied or dissatisfied and will engage in dissatisfied and will engage in postpurchase behavior of interest. postpurchase behavior of interest.

Whether the buyer is satisfied or Whether the buyer is satisfied or dissatisfied is determined by the dissatisfied is determined by the relationship between the consumer’s relationship between the consumer’s expectations and the product’s expectations and the product’s performance.performance.

The marketer’s job does not end when The marketer’s job does not end when the product is bought. The marketer the product is bought. The marketer must do research in order to must do research in order to understand whether the consumer is understand whether the consumer is satisfied about the product or not. satisfied about the product or not. Responding to consumer complaints Responding to consumer complaints help to reduce the number of help to reduce the number of dissatisfied consumers. E.g. Toyota dissatisfied consumers. E.g. Toyota contacts the new car owners and contacts the new car owners and congratulates them. In addition, places congratulates them. In addition, places advertising with the favorable words of advertising with the favorable words of the new car owners. “I love what you do the new car owners. “I love what you do for me Toyota”for me Toyota”

The Reinforcement The Reinforcement ParadigmParadigm

Focuses on the way behavior is modified Focuses on the way behavior is modified by the environment, therefore managers by the environment, therefore managers try to change the consumer’s situation.try to change the consumer’s situation.

Past behavior teaches consumers and Past behavior teaches consumers and after learning they shape their future after learning they shape their future puchases.puchases.

There are a number of ways to learn There are a number of ways to learn about products and brands including about products and brands including trial and error, brand extention, use of trial and error, brand extention, use of stimuli (packaging, colors, etc.).stimuli (packaging, colors, etc.).

The Habit Paradigm The Habit Paradigm

Focuses on established patterns of Focuses on established patterns of behavior. behavior.

Mobilised in response to relevant Mobilised in response to relevant stimuli.stimuli.

Consumer behavior for Consumer behavior for tourism and hospitality tourism and hospitality

services?services?

Consumers and Markets for Consumers and Markets for Tourism and Hospitality Tourism and Hospitality

ServicesServices A market is defined as all those A market is defined as all those

willing and able to purchase tourism willing and able to purchase tourism and hospitality services.and hospitality services.

A market includes both current and A market includes both current and potential customers.potential customers.

Organizations need to know how Organizations need to know how their services are positioned in the their services are positioned in the mind of both current and potential mind of both current and potential customers. customers.

Markets and customer-base of Markets and customer-base of organizations change in time due to organizations change in time due to changes in socio-economic changes in socio-economic circumstances, attitudes (e.g. organic circumstances, attitudes (e.g. organic products)products)

Consumers atttudes toward company’s Consumers atttudes toward company’s products and offers may also change. products and offers may also change.

Marketing communications is basically Marketing communications is basically directed towards developing sales. directed towards developing sales.

The messages must be created and The messages must be created and delivered having target audiences in delivered having target audiences in mind. mind.

Generic Versus Variant Service Generic Versus Variant Service MarketsMarkets Before preparing their marketing Before preparing their marketing

communications, marketers need to communications, marketers need to distinguish between generic needs of distinguish between generic needs of markets for tourism and hospitality services markets for tourism and hospitality services and the range of offers (variants) within that and the range of offers (variants) within that generic category. generic category. For instance, while a package holiday is a generic For instance, while a package holiday is a generic

service category, there are subcategories or service category, there are subcategories or services product classes under it; winter sun, services product classes under it; winter sun, summer sun, lakes and mountains, activity as summer sun, lakes and mountains, activity as safari holidays (which may even have a range of safari holidays (which may even have a range of different types like day safaris, 1-3 nights short-different types like day safaris, 1-3 nights short-break safaris, luxury safaris, budget safaris...break safaris, luxury safaris, budget safaris...

Marketing AnalysisMarketing Analysis

In order to understand more about their In order to understand more about their customers and develop the right customers and develop the right marketing plans and communications marketing plans and communications strategies, managers should break down a strategies, managers should break down a market into more discrete market groups market into more discrete market groups or segments.or segments.

Therefore, they do a great deal of analysis Therefore, they do a great deal of analysis on customers and markets. on customers and markets.

This type of market analysis is sometimes This type of market analysis is sometimes called market analysis-competitor called market analysis-competitor analysis. analysis.

Such analysis look at the following Such analysis look at the following factors:factors: Total number of people in a population Total number of people in a population

who ay be purchase the products/serviceswho ay be purchase the products/services Total number of customers actually Total number of customers actually

buying these types of products/servicesbuying these types of products/services Size of sales of the company’s Size of sales of the company’s

products/services relative to competitors’products/services relative to competitors’ Relationship between the company’s Relationship between the company’s

products/services relative to competitors’ products/services relative to competitors’ Ability of people to buy company’s offer Ability of people to buy company’s offer

over other types of products/services.over other types of products/services.

In developing marketing In developing marketing communications, first markets are communications, first markets are analysed. analysed. Market analysisMarket analysis Identification of stakeholdersIdentification of stakeholders Customer analysisCustomer analysis Segmentation and targetingSegmentation and targeting Marketing communications mixMarketing communications mix Customer relationship managementCustomer relationship management Service quality and satisfactionService quality and satisfaction

What the Organization What the Organization Needs to Know about Needs to Know about Consumers’ BehaviorConsumers’ Behavior

Marketing communications must Marketing communications must consider that consumers are open to consider that consumers are open to influence from external environmental influence from external environmental factors which influence consumer factors which influence consumer behavior and how they process behavior and how they process marketing messages. marketing messages.

In order to develop attractive messages, In order to develop attractive messages, organizations need to answer the organizations need to answer the following questions about their following questions about their customers;customers;

Who:Who: what type of person, their socio- what type of person, their socio-demographic characteristics and situational demographic characteristics and situational influences.influences.

When:When: do people buy and when they receive do people buy and when they receive and/or receptive to messages.and/or receptive to messages.

Why:Why: their motives for buying and also how their motives for buying and also how they react to the messages through perception.they react to the messages through perception.

What:What: their preferences, attitudes and beliefs their preferences, attitudes and beliefs about the services they buy and their purchase about the services they buy and their purchase behavior; also their reactions to marketing behavior; also their reactions to marketing messages, the frequency of purchase and use. messages, the frequency of purchase and use.

Where:Where: the place they buy the products or the place they buy the products or receive the messages from.receive the messages from.

Which methods:Which methods: they use to purchase the they use to purchase the products/services. products/services.

Consumer Consumer Characteristics – Who?Characteristics – Who?

In order to better target their marketing In order to better target their marketing communications, when analying markets, communications, when analying markets, it is important for organizations to it is important for organizations to collect information on the following;collect information on the following; DemographicsDemographics Socio-economic characteristics; employment Socio-economic characteristics; employment

status, social class, lifestyle, etc. status, social class, lifestyle, etc. Feelings, beliefs and valuesFeelings, beliefs and values Decision-making units; childrenDecision-making units; children Buying center roles; initiator, influencer, Buying center roles; initiator, influencer,

gatekeeper, decider, puchaser, user.gatekeeper, decider, puchaser, user.

Decision and Purchase Decision and Purchase Characteristics – When?Characteristics – When?

Organizations should understand Organizations should understand when customers buy their when customers buy their porducts/services by checking their porducts/services by checking their sales data, when they search for sales data, when they search for information, when they make their information, when they make their decision to buy and what infleunce decision to buy and what infleunce those decisions, so that they can those decisions, so that they can determine the timing of their determine the timing of their marketing communications. marketing communications.

Consumer Motivations – Consumer Motivations – Why?Why?

If organizations understand why If organizations understand why customers choose their customers choose their products/services over competitors’, products/services over competitors’, then they can direct their marketing then they can direct their marketing communications to stimulate new communications to stimulate new demand (extend the market) or remind.demand (extend the market) or remind.

Motivation; physical, social, personal, Motivation; physical, social, personal, cultural motivations for tourism and cultural motivations for tourism and hospitality products/serviceshospitality products/services

PerceptionsPerceptions IdentityIdentity

Buying Behavior Patterns – Buying Behavior Patterns – What?What?

This question is about the types of This question is about the types of things people buy, e.g. Short things people buy, e.g. Short breakes vs. long holidays etc. breakes vs. long holidays etc.

Attitudes; marketing Attitudes; marketing communications managers are communications managers are interested in understanding how interested in understanding how attitudes to places and services can attitudes to places and services can be influenced.be influenced.

Distribution and Access – Distribution and Access – Where?Where?

This relates to how consumers This relates to how consumers access marketing messages, e.g. access marketing messages, e.g. Online booking, etc. Online booking, etc.

Orgenizations need to know where Orgenizations need to know where consumers access marketing consumers access marketing communications and under which communications and under which circumstances they react favourably circumstances they react favourably in relation to the content of the in relation to the content of the message.message.

Purchase Characteristics – Purchase Characteristics – Which Methods?Which Methods?

Organizations also need to know Organizations also need to know how consumers purchase their how consumers purchase their products/services e.g. cash or by products/services e.g. cash or by credit card, etc.; how they book, credit card, etc.; how they book, whether they get help or not, whether they get help or not, whether they pay in advance or not.whether they pay in advance or not.

ResourcesResources

McCabe, S. (2009). Marketing McCabe, S. (2009). Marketing Communications in Tourism and Communications in Tourism and Hospitality: Concepts, Strategies and Hospitality: Concepts, Strategies and Cases. Butterworth-Heinemann: Oxford. Cases. Butterworth-Heinemann: Oxford.

Kotler, P.; Bowen, J. and Makens, J. (Kotler, P.; Bowen, J. and Makens, J. (20102010). ). Marketing for Hospitality and Tourism (Marketing for Hospitality and Tourism (5th. 5th. ed.). Prentice Halled.). Prentice Hall: New Jersey.: New Jersey.

Kotler, P. and Armstrong, G. (20Kotler, P. and Armstrong, G. (201010) ) Principles of Marketing (1Principles of Marketing (133th ed.). Prentice th ed.). Prentice HallHall: New Jersey.: New Jersey.