MSc in Digital Marketing Week 2
Note: these notes are aimed as a memory mnemonic for my MSc in Digital Marketing
Review of Marketing Orientation and Introduction to Customer Behaviour
The marketing concept was one of the first strategic frameworks to provided firms with a sustainable competitive advantage
Competitive Advantage: To achieve superior performance through differentiation, to provide superior customer value, or by managing to achieve the lowest delivered cost. (Dibb & Simkin, 2004)
Academics began recognizing and operationalizing the marketing concept as “market orientation” in the 1990s (Kohli and Jaworski 1990, as cited by Kumar, et al, 2011)
Market orientation’s primary objective is to deliver superior customer value, based on knowledge derived from customer and competitor analyses and the process by which this knowledge is gained and disseminated throughout the organization. (Felton 1959; Narver and Slater 1990 as cited by Kumar, et al, 2011)
the components of ‘market orientation’ are: customer orientation, competitor orientation and interfunctional co-ordination. Kumar, et al, 2010, citing Kohli and Jaworski 1990
Studying Consumer Behaviour
- Makes good business sense if companies want to understand their customers’ needs.
- As an input into the marketing strategy – consumer response may often be the ultimate test of whether or not a marketing strategy will succeed
Nice model of ‘consumer behaviour’ in Kotley & Keller (2009)
Nice ‘stages of the consumption process’ in Solomon (2011)
Types of decision making – often based on level of risk from habitual decision making (bottle of water) > limited problem solving (toaster) > extensive problem solving (car)
buyology – Truth and Lies About Why We Buy (Martin Lindstrom; 2008) = the analysis of what makes (the psychology behind) people buy stuff.
Neuromarketing is a new field of marketing research that studies consumers’ sensorimotor, cognitive, and affective response to marketing stimuli. The word “neuromarketing” was coined by Ale Smidts in 2002.
Researchers use technologies to measure changes in activity in parts of the brain and/or sensors to measure changes in one’s physiological state, also known as biometrics to learn why consumers make the decisions they do, and what part of the brain is telling them to do it. Companies such as Google have used neuromarketing research services to measure consumer thoughts on their products
My favourite bit of the whole module = Maslow’s Hierarchy of Needs. Boom. #oldskool. Basically you can base marketing strategies on this model.
Then there was a comparison between Maslow & Hertzberg. So:
Self actualisation, self esteem and social (Maslow) = motivators (Hertzberg)
Safety + physiological (Maslow) = hygiene (Hertzberg).
The Role of Market Segmentation
We have to do it as there are too many potential customers to attract with a single marketing mix.
Market segmentation = Division of the total market into smaller, relatively homogenous groups.
Four common bases for segmenting consumer markets:
- Geographic segmentation
- Demographic segmentation
– Age, Gender, FLC, Social Class
- Behavioural / Product-related segmentation
– Benefit, loyalty, Attitude, Buyer Readiness, Usage
- Psychographic segmentation
– Opinions, Interests, Activities, Personality
– Motivation, Lifestyle
Psychographic Segmentation – The division of a population into groups that have similar psychological characteristics, values, motivations and lifestyles.
Good psychographic segmentation system developed by SRI Consulting Business Intelligence called VALS (Values, Attitudes and Lifestyles) that is based on concepts of resources and motivation.
VALS is researched using a questionnaire of 35 lifestyle and 5 demographic questions and is beneficial in 3 key areas:
- helps marketers create more effective goods and services for a target market
- Good leading segmentation mechanism that overlays the bones that geographic and demographic segmentation provides
- You may be of a similar age but you will all have various personalities and lifestyles
Then I watched a TED talk on the anthropology of mobile phones by Jan ChipChase (what an amazing name).
TED talk summary:
The 3 most important things people carry = keys, money and a mobile phone.
…Fundamental reason is based in survival. Keys = shelter/ warmth. Money = food/drink + travel to safety. Mobile = great recovery tool. Which was interesting as this links in with Maslow’s base points in his Hierarchy of Needs.