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Quiz 7 :

Customer Valuedriven Marketing Strategy: Creating Value for Target Customers

Quiz 7 :

Customer Valuedriven Marketing Strategy: Creating Value for Target Customers

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Consumers use one of three decision-making processes when purchasing goods or services: routinized response behavior, limited decision making, or extended decision making. Describe three buying experiences you have had (one for each type of decision making), and identify which decision-making type you used. Discuss why that particular process was appropriate.
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The three buying experiences of consumer XYZ along with problem solving used are mentioned below:
1) Household purchased at supermarket needs routinized response behaviour because lower risk and involvement is associated with this problem solving process. The products available have lower price and do not require any information gathering before making a purchase.
2) Purchase of shoes, perfumes and clothes, dinner at restaurants are examples of limited problem solving. These experiences fall in limited problem solving category as they are purchased occasionally and buyer needs to gather maximum information about various available brands in option. It needs buyer's time to make a decision.
3) To buy a new car, extended problem solving is required because these decisions need maximum information about the product to be purchased.

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Iams and Eukanuba Understand People Who Love Pets Many people treat their pets like family members and want to buy them the best, creating opportunities for marketing pet foods, treats, and even insurance. Marketers at Iams and Eukanuba, both owned by Procter Gamble, are using their knowledge of consumer behavior to market these goods and services to pet "parents." "The humanization trend continues in pet care, as pet parents continue to increase in willingness to invest in their pets," observes the Iams brand manager at parent company Procter Gamble. Food for cats and dogs has become a $19 billion business. As in the overall market for people food, pet foods with all-natural or special ingredients are increasingly attractive choices for consumers who are focused on pet health. For example, Iams ProActive Health pet foods include PreBiotics, good bacteria that promote healthy digestion. The company also has a Healthy Naturals line containing no artifi - cial colors, flavors, or preservatives. New lines of Iams and Eukanuba pet foods meet the nutritional needs of "senior" dogs and cats (older than nine). The popularity of such products indicates that consumers are highly involved in buying decisions about pet food, seeing pets as family members entitled to the same quality food and nutrition as everyone else in the family. Iams and Eukanuba use research to uncover the specific needs and preferences of consumers with pets. For example, customers with more than one cat were concerned about how to feed them when one cat is overweight but others are not. As a result, Iams created a Multi-Cat formula with ingredients aimed at reducing fat in heavy cats while still providing protein for lean cats. The company's Savory Sauce formulas for dogs are bottled just like barbecue sauces or marinades for people. The sauces are fortified with vitamins, minerals, and antioxidants, are low in calories and fat, and come in flavors such as Pot Roast or Country Style Chicken. Eukanuba also markets special foods for dogs with sensitive skin or a sensitive stomach, as well as breed-specific foods (for boxers, Labradors, and other dog breeds). More than 100,000 people have clicked to "like" Eukanuba's Facebook page, which features pet-care tips and videos, new product information, and links to sponsorships of events such as the American Kennel Club/Eukanuba National Championships. Through Facebook and Twitter, Eukanuba invites pet owners to submit questions for expert answers, showcasing the brand's connection with pet well-being. Eukanuba's YouTube channel offers tutorials on puppy training, highlights of dog-show winners, and videos about individual dog breeds. To help consumers learn more about training pets, feeding them properly, and what to expect as pets age, Iams partners with Dog Fancy and Cat Fancy magazines to provide free online classes at Dog College and Cat College. The curriculum includes courses on physiology, natural nutrition, communication, genetics, environmental science, health science, and art history. Participants can also enter to win pet food and, when they finish a course, print a Dog College "bark-alaureate" diploma. In addition, Iams and Eukanuba partner with the Veterinary Pet Insurance Co. to provide health insurance for cats, dogs, birds, and more exotic pets. By offering a wide variety of goods and services for pet health and well-being, Iams and Eukanuba are clearly paying attention to the needs of pet owners and making it possible for them to create healthy lifestyles for their pets. Why would consumers continue spending on their pets even during an economic downturn? Explain your answer in terms of consumer buying behavior concepts.
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Most pet lovers treat their pets as their family members. In fact, their company gives them the most pleasure for them. They feel their pets always as a stress relievers and energy boosters. Even though they are tired from dawn to dusk, the touch of their pets make them to be free from all headaches. That is the main reason; they never leave their pets even during their economic downturn.
In terms of consumer behaviour the pet lover's personals factors such as the stage of the life cycle, the interests, the age etc, shows a great effect on their lover towards the pets.

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What are the major stages in the consumer buying decision process? Are all these stages used in all consumer purchase decisions? Why or why not?
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Consumers have many types of problem solving processes that they can use to maintain and acquire various products. These products help customers satisfying their future and current needs.
Each process involve varied amount of physical and mental efforts depending upon the consumer's involvement, individual interest. There are varied levels of interest like enduring, situational, high, and low.
There is less social risk and expense associated with low involvement products. Situational involvement is dynamic and temporary. Consumer involvement is associated with different product categories, interest in advertisements, brand loyalty, and certain behaviours and decisions.

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Starbucks Refines the Customer Experience Starbucks-the Seattle-based company that popularized the "coffee culture"-is brewing up higher sales through new beverages and new cafés in global markets. A stop at Starbucks has become part of many consumers' daily routines. Some are attracted by the high-quality, brewed-to-order coffees, while others look forward to relaxing and socializing in the "third place" between home and work. Starbucks has researched and refined every aspect of the customer experience, from the size of its coffees ("tall" is actually "small") to the number of minutes that customers spend waiting in line. To speed up purchases, it offers a pay-by- cell phone option called "mobile pay." Consumers with iPhone or Android cell phones simply download the app and let cashiers scan the Starbucks code on the screen during checkout. The app links to the customer's Starbucks Card, which combines the rewards of a loyalty program with the convenience of a prepaid card for making purchases. Mobile pay is a big hit: in its first 15 months, customers used their cell phones to make more than 42 million payments to Starbucks. Well established in the intensely competitive U.S. market, Starbucks is growing much more quickly in Asian markets. The company will soon have 1,500 cafés and 30,000 employees in China, where consumers drink, on average, just three cups of coffee every year. By opening in more locations and encouraging consumers to bring their friends for coffee and conversation, Starbucks aims to increase demand and boost sales throughout China. In Japan, where Starbucks now has more than 1,000 cafés, consumers have long enjoyed the tradition of meeting in neighborhood coffee shops. Through market research, Starbucks stays in touch with what its customers like and what their lifestyles are like. Coffee lovers are still buying their espressos or lattes, but they're also "looking for a healthier lifestyle," says a Starbucks executive. In response to this trend, the company bought Evolution Fresh, which makes premium juices, and opened its first Evolution Fresh store in Bellevue, Washington. On the menu: all natural, freshly-blended drinks from nutritious fruits and vegetables, plus salads and wraps. Over time, Starbucks is adding Evolution Fresh drinks to the menu in all of its cafés and opening additional Evolution Fresh stores on the East and West Coasts. Although expanding into fresh juices means competing with Jamba Juice and other rivals, Starbucks is relying on its brand-building expertise to juice up this part of its business. Taking note of consumer interest in energy drinks, which has blossomed into an $8 billion market, Starbucks has also launched Starbucks Refreshers, a line of carbonated drinks with more than half the caffeine content of an espresso shot. Available in supermarkets and in Starbucks cafés, these all-natural drinks combine green, unroasted coffee with fruit juices for a fruity, non-coffee flavor. To gain significant market share, Starbucks must battle Red Bull, Rockstar, and other well-known marketers of energy drinks. Starbucks also believes in social responsibility. It offers health-insurance benefits to both part-time and full-time employees and donates generously to community projects. It also protects the environment by recycling in every café and constructing buildings designed to save energy and water. Finally, the company follows ethical purchasing practices to ensure that coffee growers get a fair price for their premium beans. Why would Starbucks want customers to know that it believes in social responsibility?
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Iams and Eukanuba Understand People Who Love Pets Many people treat their pets like family members and want to buy them the best, creating opportunities for marketing pet foods, treats, and even insurance. Marketers at Iams and Eukanuba, both owned by Procter Gamble, are using their knowledge of consumer behavior to market these goods and services to pet "parents." "The humanization trend continues in pet care, as pet parents continue to increase in willingness to invest in their pets," observes the Iams brand manager at parent company Procter Gamble. Food for cats and dogs has become a $19 billion business. As in the overall market for people food, pet foods with all-natural or special ingredients are increasingly attractive choices for consumers who are focused on pet health. For example, Iams ProActive Health pet foods include PreBiotics, good bacteria that promote healthy digestion. The company also has a Healthy Naturals line containing no artifi - cial colors, flavors, or preservatives. New lines of Iams and Eukanuba pet foods meet the nutritional needs of "senior" dogs and cats (older than nine). The popularity of such products indicates that consumers are highly involved in buying decisions about pet food, seeing pets as family members entitled to the same quality food and nutrition as everyone else in the family. Iams and Eukanuba use research to uncover the specific needs and preferences of consumers with pets. For example, customers with more than one cat were concerned about how to feed them when one cat is overweight but others are not. As a result, Iams created a Multi-Cat formula with ingredients aimed at reducing fat in heavy cats while still providing protein for lean cats. The company's Savory Sauce formulas for dogs are bottled just like barbecue sauces or marinades for people. The sauces are fortified with vitamins, minerals, and antioxidants, are low in calories and fat, and come in flavors such as Pot Roast or Country Style Chicken. Eukanuba also markets special foods for dogs with sensitive skin or a sensitive stomach, as well as breed-specific foods (for boxers, Labradors, and other dog breeds). More than 100,000 people have clicked to "like" Eukanuba's Facebook page, which features pet-care tips and videos, new product information, and links to sponsorships of events such as the American Kennel Club/Eukanuba National Championships. Through Facebook and Twitter, Eukanuba invites pet owners to submit questions for expert answers, showcasing the brand's connection with pet well-being. Eukanuba's YouTube channel offers tutorials on puppy training, highlights of dog-show winners, and videos about individual dog breeds. To help consumers learn more about training pets, feeding them properly, and what to expect as pets age, Iams partners with Dog Fancy and Cat Fancy magazines to provide free online classes at Dog College and Cat College. The curriculum includes courses on physiology, natural nutrition, communication, genetics, environmental science, health science, and art history. Participants can also enter to win pet food and, when they finish a course, print a Dog College "bark-alaureate" diploma. In addition, Iams and Eukanuba partner with the Veterinary Pet Insurance Co. to provide health insurance for cats, dogs, birds, and more exotic pets. By offering a wide variety of goods and services for pet health and well-being, Iams and Eukanuba are clearly paying attention to the needs of pet owners and making it possible for them to create healthy lifestyles for their pets. Which of the psychological influences on pet owners should marketers at Iams and Eukanuba pay particular attention to, and why?
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Starbucks Refines the Customer Experience Starbucks-the Seattle-based company that popularized the "coffee culture"-is brewing up higher sales through new beverages and new cafés in global markets. A stop at Starbucks has become part of many consumers' daily routines. Some are attracted by the high-quality, brewed-to-order coffees, while others look forward to relaxing and socializing in the "third place" between home and work. Starbucks has researched and refined every aspect of the customer experience, from the size of its coffees ("tall" is actually "small") to the number of minutes that customers spend waiting in line. To speed up purchases, it offers a pay-by- cell phone option called "mobile pay." Consumers with iPhone or Android cell phones simply download the app and let cashiers scan the Starbucks code on the screen during checkout. The app links to the customer's Starbucks Card, which combines the rewards of a loyalty program with the convenience of a prepaid card for making purchases. Mobile pay is a big hit: in its first 15 months, customers used their cell phones to make more than 42 million payments to Starbucks. Well established in the intensely competitive U.S. market, Starbucks is growing much more quickly in Asian markets. The company will soon have 1,500 cafés and 30,000 employees in China, where consumers drink, on average, just three cups of coffee every year. By opening in more locations and encouraging consumers to bring their friends for coffee and conversation, Starbucks aims to increase demand and boost sales throughout China. In Japan, where Starbucks now has more than 1,000 cafés, consumers have long enjoyed the tradition of meeting in neighborhood coffee shops. Through market research, Starbucks stays in touch with what its customers like and what their lifestyles are like. Coffee lovers are still buying their espressos or lattes, but they're also "looking for a healthier lifestyle," says a Starbucks executive. In response to this trend, the company bought Evolution Fresh, which makes premium juices, and opened its first Evolution Fresh store in Bellevue, Washington. On the menu: all natural, freshly-blended drinks from nutritious fruits and vegetables, plus salads and wraps. Over time, Starbucks is adding Evolution Fresh drinks to the menu in all of its cafés and opening additional Evolution Fresh stores on the East and West Coasts. Although expanding into fresh juices means competing with Jamba Juice and other rivals, Starbucks is relying on its brand-building expertise to juice up this part of its business. Taking note of consumer interest in energy drinks, which has blossomed into an $8 billion market, Starbucks has also launched Starbucks Refreshers, a line of carbonated drinks with more than half the caffeine content of an espresso shot. Available in supermarkets and in Starbucks cafés, these all-natural drinks combine green, unroasted coffee with fruit juices for a fruity, non-coffee flavor. To gain significant market share, Starbucks must battle Red Bull, Rockstar, and other well-known marketers of energy drinks. Starbucks also believes in social responsibility. It offers health-insurance benefits to both part-time and full-time employees and donates generously to community projects. It also protects the environment by recycling in every café and constructing buildings designed to save energy and water. Finally, the company follows ethical purchasing practices to ensure that coffee growers get a fair price for their premium beans. In terms of situational influences and level of involvement, what are the benefits of mobile pay?
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Amazon Some mass-market e-commerce sites, such as Amazon, have extended the concept of customization to their customer base. The company has created an affinity group by drawing on certain users' likes and dislikes to make product recommendations to other users. Check out this pioneering online retailer at www.amazon.com. Is the consumer's level of involvement with an online book purchase likely to be high or low?
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An individual's roles influence that person's buying behavior. Identify two of your roles, and give an example of how they have influenced your buying decisions.
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Understanding the process that an individual consumer goes through when purchasing a product is essential for developing marketing strategy. Knowledge about the potential customer's buying behavior will become the basis for many of the decisions in the specific marketing plan. Using the information from this chapter, you should be able to determine the following: See Table 7.1.What type of decision making are your customers likely to use when purchasing your product? img The information obtained from these questions should assist you in developing various aspects of your marketing plan found in the "Interactive Marketing Plan" exercise at www.cengagebrain.com.
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Name the types of consumer decision-making processes. List some products you have bought using each type. Have you ever bought a product on impulse? If so, describe the circumstances.
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Starbucks Refines the Customer Experience Starbucks-the Seattle-based company that popularized the "coffee culture"-is brewing up higher sales through new beverages and new cafés in global markets. A stop at Starbucks has become part of many consumers' daily routines. Some are attracted by the high-quality, brewed-to-order coffees, while others look forward to relaxing and socializing in the "third place" between home and work. Starbucks has researched and refined every aspect of the customer experience, from the size of its coffees ("tall" is actually "small") to the number of minutes that customers spend waiting in line. To speed up purchases, it offers a pay-by- cell phone option called "mobile pay." Consumers with iPhone or Android cell phones simply download the app and let cashiers scan the Starbucks code on the screen during checkout. The app links to the customer's Starbucks Card, which combines the rewards of a loyalty program with the convenience of a prepaid card for making purchases. Mobile pay is a big hit: in its first 15 months, customers used their cell phones to make more than 42 million payments to Starbucks. Well established in the intensely competitive U.S. market, Starbucks is growing much more quickly in Asian markets. The company will soon have 1,500 cafés and 30,000 employees in China, where consumers drink, on average, just three cups of coffee every year. By opening in more locations and encouraging consumers to bring their friends for coffee and conversation, Starbucks aims to increase demand and boost sales throughout China. In Japan, where Starbucks now has more than 1,000 cafés, consumers have long enjoyed the tradition of meeting in neighborhood coffee shops. Through market research, Starbucks stays in touch with what its customers like and what their lifestyles are like. Coffee lovers are still buying their espressos or lattes, but they're also "looking for a healthier lifestyle," says a Starbucks executive. In response to this trend, the company bought Evolution Fresh, which makes premium juices, and opened its first Evolution Fresh store in Bellevue, Washington. On the menu: all natural, freshly-blended drinks from nutritious fruits and vegetables, plus salads and wraps. Over time, Starbucks is adding Evolution Fresh drinks to the menu in all of its cafés and opening additional Evolution Fresh stores on the East and West Coasts. Although expanding into fresh juices means competing with Jamba Juice and other rivals, Starbucks is relying on its brand-building expertise to juice up this part of its business. Taking note of consumer interest in energy drinks, which has blossomed into an $8 billion market, Starbucks has also launched Starbucks Refreshers, a line of carbonated drinks with more than half the caffeine content of an espresso shot. Available in supermarkets and in Starbucks cafés, these all-natural drinks combine green, unroasted coffee with fruit juices for a fruity, non-coffee flavor. To gain significant market share, Starbucks must battle Red Bull, Rockstar, and other well-known marketers of energy drinks. Starbucks also believes in social responsibility. It offers health-insurance benefits to both part-time and full-time employees and donates generously to community projects. It also protects the environment by recycling in every café and constructing buildings designed to save energy and water. Finally, the company follows ethical purchasing practices to ensure that coffee growers get a fair price for their premium beans. With Evolution Fresh, which psychological influences on consumer buying decisions does Starbucks seem to be addressing?
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How does a consumer's level of involvement affect his or her choice of decision-making process?
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The consumer buying process consists of five stages: problem recognition, information search, evaluation of alternatives, purchase, and postpurchase evaluation. Not every buying decision goes through all five stages, and the process does not necessarily conclude in a purchase. Interview a classmate about the last purchase he or she made. Report the stages used and those skipped, if any.
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Amazon Some mass-market e-commerce sites, such as Amazon, have extended the concept of customization to their customer base. The company has created an affinity group by drawing on certain users' likes and dislikes to make product recommendations to other users. Check out this pioneering online retailer at www.amazon.com. What might motivate some consumers to read a "Top Selling" list?
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Iams and Eukanuba Understand People Who Love Pets Many people treat their pets like family members and want to buy them the best, creating opportunities for marketing pet foods, treats, and even insurance. Marketers at Iams and Eukanuba, both owned by Procter Gamble, are using their knowledge of consumer behavior to market these goods and services to pet "parents." "The humanization trend continues in pet care, as pet parents continue to increase in willingness to invest in their pets," observes the Iams brand manager at parent company Procter Gamble. Food for cats and dogs has become a $19 billion business. As in the overall market for people food, pet foods with all-natural or special ingredients are increasingly attractive choices for consumers who are focused on pet health. For example, Iams ProActive Health pet foods include PreBiotics, good bacteria that promote healthy digestion. The company also has a Healthy Naturals line containing no artifi - cial colors, flavors, or preservatives. New lines of Iams and Eukanuba pet foods meet the nutritional needs of "senior" dogs and cats (older than nine). The popularity of such products indicates that consumers are highly involved in buying decisions about pet food, seeing pets as family members entitled to the same quality food and nutrition as everyone else in the family. Iams and Eukanuba use research to uncover the specific needs and preferences of consumers with pets. For example, customers with more than one cat were concerned about how to feed them when one cat is overweight but others are not. As a result, Iams created a Multi-Cat formula with ingredients aimed at reducing fat in heavy cats while still providing protein for lean cats. The company's Savory Sauce formulas for dogs are bottled just like barbecue sauces or marinades for people. The sauces are fortified with vitamins, minerals, and antioxidants, are low in calories and fat, and come in flavors such as Pot Roast or Country Style Chicken. Eukanuba also markets special foods for dogs with sensitive skin or a sensitive stomach, as well as breed-specific foods (for boxers, Labradors, and other dog breeds). More than 100,000 people have clicked to "like" Eukanuba's Facebook page, which features pet-care tips and videos, new product information, and links to sponsorships of events such as the American Kennel Club/Eukanuba National Championships. Through Facebook and Twitter, Eukanuba invites pet owners to submit questions for expert answers, showcasing the brand's connection with pet well-being. Eukanuba's YouTube channel offers tutorials on puppy training, highlights of dog-show winners, and videos about individual dog breeds. To help consumers learn more about training pets, feeding them properly, and what to expect as pets age, Iams partners with Dog Fancy and Cat Fancy magazines to provide free online classes at Dog College and Cat College. The curriculum includes courses on physiology, natural nutrition, communication, genetics, environmental science, health science, and art history. Participants can also enter to win pet food and, when they finish a course, print a Dog College "bark-alaureate" diploma. In addition, Iams and Eukanuba partner with the Veterinary Pet Insurance Co. to provide health insurance for cats, dogs, birds, and more exotic pets. By offering a wide variety of goods and services for pet health and well-being, Iams and Eukanuba are clearly paying attention to the needs of pet owners and making it possible for them to create healthy lifestyles for their pets. During which stages of the buying decision process would you expect the educational resources of Dog College and Cat College to have the most influence on consumers' behavior?
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Amazon Some mass-market e-commerce sites, such as Amazon, have extended the concept of customization to their customer base. The company has created an affinity group by drawing on certain users' likes and dislikes to make product recommendations to other users. Check out this pioneering online retailer at www.amazon.com. Discuss the consumer buying decision process as it relates to a decision to purchase from Amazon.
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What are the categories of situational factors that influence consumer buying behavior? Explain how each of these factors influences buyers' decisions.
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Understanding the process that an individual consumer goes through when purchasing a product is essential for developing marketing strategy. Knowledge about the potential customer's buying behavior will become the basis for many of the decisions in the specific marketing plan. Using the information from this chapter, you should be able to determine the following: Determine the evaluative criteria that your target market(s) would use when choosing between alternative brands. The information obtained from these questions should assist you in developing various aspects of your marketing plan found in the "Interactive Marketing Plan" exercise at www.cengagebrain.com.
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Understanding the process that an individual consumer goes through when purchasing a product is essential for developing marketing strategy. Knowledge about the potential customer's buying behavior will become the basis for many of the decisions in the specific marketing plan. Using the information from this chapter, you should be able to determine the following: Using Table 7.2, what types of family decision making, if any, would your target market(s) use? img The information obtained from these questions should assist you in developing various aspects of your marketing plan found in the "Interactive Marketing Plan" exercise at www.cengagebrain.com.
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Attitudes toward products or companies often affect consumer behavior. The three components of an attitude are cognitive, affective, and behavioral. Briefly describe how a beer company might alter the cognitive and affective components of consumer attitudes toward beer products and toward the company.
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