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Kezia Maria N.

P
MCD2050 Tutorial Essay Questions: Week 5
1A: Describe the three (3) major types of reference groups that can influence consumer
behaviour. Use the example of choosing a university degree, to demonstrate the influence
of each reference group on consumer behaviour. (50%)
Reference groups are groups that have a direct or indirect influence on a person’s
attitudes or behaviour. They often serve as our role models and inspiration. Marketers view
reference groups as important because they influence how consumers interpret information
and make purchasing decisions. Reference groups influence what types of products a person
will purchase and which brand of product a person will choose. There are three types of
reference groups, there are membership groups, aspirational groups, and dissociative groups.
Membership groups are groups that have a direct influence on a person’s behaviour and to
which a person belongs, for example friends, teachers, family, etc. However, aspirational
groups are groups to which an individual wish to belong, for example corporate work
colleagues or even celebrities. Whereas, dissociative groups are groups to which an individual
does not wish to be associated with such as gangs and extremist groups.
Based on the video, there are many common mistakes that usually teenagers did when
choosing university or college. The mistake is many teens choose a university because many
of his/her friends going to that university. He/she wants to enter the university because
he/she wants to feel the familiarity. When friends influence a person’s decisions, that is what
we called membership groups. In this case friends have direct influence in a person while
decide a university. It can cause disappointment in a long term because other people
preferences can’t be equated. In this case the aspirational group can be the alumni of the
university that promoting and sharing their experiences to them. The positive feedback from
the alumni can make the teenagers interested to enter the university and choose the degree
because he/she wants to reach their success with the same path like the alumni. However,
teenagers don’t want to be impacted by the dissociative groups, so when they are choosing
university, they can choose their circle, make friends with good people, and avoid any people
that maybe give negative impact (for example the gangsters, etc).

1B: Using the consumer decision-making process, explain in detail the stages a consumer
will go through when deciding on their destination university degree. (50%)

The importance of a purchase is related to the consumer’s involvement. Before buying a


product customers will do certain things so they can surely decide what they want to buy.
Firstly, they have to recognise the needs and wants. Consumer is aware of unsatisfied needs
or wants so the marketers stimulates or create awareness of a new need or wants. Secondly
the consumer must search more information about the product from all available and
convenient resources that are trusted. Third, they have to evaluate and select from many
options that offered, so they can evaluate by the criteria they want, rank all of the
alternatives and considering the willingness to purchasing/not purchasing the product. After

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that, they will purchase the product after choosing the exact product and brand. Lastly,
after the consumer already purchase the product they can continue to evaluate the product
and deal with the cognitive dissonance(the state of having inconsistent thoughts, beliefs, or
attitudes, especially as relating to behavioral decisions and attitude change). The consumer
will give feedback to the brand or seller and it will affect the future purchases.
When choosing university degree, people must think about what kind of faculty they
like or dislike to make sure that the upcoming decision will make them satisfied. The next
thing to do is to search more information about the related degree, the differences between
degrees, the similarities, the advantage, the units, and also the opportunity in the future after
they graduate from the university. After having much information, they can evaluate and
select between many choices of degree, and minimize their choice, they can evaluate by their
interest, ability, and preferences. The next thing to do is enrol to the university degree. After
they entering the university, they will feel the impact from the degree they take and
implement it. They will feel satisfied or even dissatisfied.

2A: Describe any three (3) personal factors that may influence consumer behaviour. Use the
example of purchasing a pair of shoes demonstrating the influence of each factor on
consumer behaviour. (50%)
Personal factors are the individual factors to the consumers that strongly influences
their buying behaviors. These factors vary from person to person that results in a different
set of perceptions, attitudes and behavior towards certain goods and services. It makes the
buyer’s decision may be impacted by their role within the buying process. Different people
(such as friends and family) may initiate or even pay for the offer, whilst the consumer is
merely the end user of the offer. Personal factors consist of age and lifecycle stage;
occupations and income; and lifestyle and personality.

- Age and lifecycle stage: This factor show that tastes in offers vary as people get
older. The interest in products, entertainment, leisure activities all change
throughout the course of a person’s life. For example, while purchasing a pair of
shoes, kids will be more interested with shoes that have colourful display or shoes
that painted with their favourite cartoon. Whereas, most of teenagers purchasing
shoes that currently on trend such as Adidas NMD, Vans, slip on sneakers, etc.
However, adults purchasing shoes based on their experience and the performance
that suit with their occasion. Based on the video, the woman choosing heels that
comfortable to used and the heels that have neutral colours, so it will be easier to
match the shoes with the outfit while working in the office. While older people will
prioritize shoes that really comfortable for them.
- Occupations and income: A person job will impact on their purchases, so the
consumer’s level of income can impact on the number of available choices. A
person with high salary will choose to buy shoes that more expensive such as Gucci,
Chanel, Louis Vuitton, and so on since they have enough money to back up their
demand. However, a person with lower income will purchase cheaper shoes since

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they have limited money. For the occupation, people that work in the office will
using heels or other formal shoes, but, people that work in the factory will use
boots or the other appropriate shoes. However, most of students using sneakers
while attending to school.
- Lifestyle and personality: Lifestyle is a person’s pattern of living as expressed in
their activities, interest, and opinions. It describes a person’s pattern of how
people allocate their money. Whereas, personality describes the unique
characteristics that lead to relatively consistent and lasting responses to one’s own
environment. It explains an individual’s behaviour. For instance, people who
always buy luxury goods or shoes from the expensive brand and famous designer
will think twice if they have to buy cheap shoes because buying luxury shoes is
their lifestyle, so it’s hard for them to change their habit. In contrast, people that
like simple things will buy basic goods, and buying luxuries goods is not a must as
long as the product still performs well.

2B: Using the situation of watching a movie, explain how each of the five (5) situational
factors may influence consumer behaviour. (50%)
Situational factors refer to the immediate circumstances or happenings that
influence consumer buying preferences. Personal factor consist of 5 factors which is
physical, social, time, motivational, and mood.

- Physical: The characteristics of the location in which the purchase decision is made.
Consumers may change or alter their purchase depending on the atmosphere,
ambience and lighting of the store. For example, if people can choose without
thinking about the price, people will choose the premiere theatre in XXI than the
usual theatre because the premiere provides comfortable seats.
- Social: The social interactions made with others at the time of purchase, such as
staff, may either attract or discourage consumers to make their purchase. For
instance, a person won’t feel satisfy if the employee in the cinema isn’t welcome
and friendly with the customers while the customers will purchase a movie ticket.
Customers won’t repurchase if the employee give the bad services.
- Time: The time allowed for a purchase decision to be made can impact the range
of options and choices available to the consumer. Time constraints can encourage
consumers to seek more convenient options. For example, since a person have a
lot of free time, he/she will prefer to watch avengers end game which has the
duration of 3 hours. But when he/she only have limited time, he/she will watch
other movie that has shorter duration.
- Motivational: The reasons or occasion for the purchase may impact the choices
made by consumers. For example, in the holiday season there are more people
watching movie either with their family or friends since they have more free time.
- Mood: The mood of a consumer at the time of purchasing the product may alter
their choice of offer. For example, a person that want to feel more relax will prefer
to watch romance or comedy movie than a horror or action movie since it will
make them nervous.

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3A. Using at least three (3) different segmentation variables, develop and justify two (2)
segment profiles for one (1) of the following products: (50%)
1. 100% Recycled, plastic-free toilet rolls (i.e. Pureplanet)
2. A domestic business class ticket (i.e. Jetstar Business Max Bundle)
3. A 3-in-1 Winter Jacket (i.e. Patagonia Women’s 3-in-1 Parka)
Segmentation is a process of dividing a market into groups based on certain shared
characteristics. Segmentation is very important because it allows an organisation to more
efficiently allocate their scarce resources and also allows an organisation to effectively meet
customer needs and wants. The first step of the segmentation process is segmenting
consumer market. There are 4 segmenting variables that used to segmenting the consumer
market, which is geographic, demographic, psychographic, and behavioural segmentation.
Geographic segmentation is a process of dividing a market into different geographical
units such as nations, regions, states, municipalities, cities or neighbourhoods. It uses
common strategy in the certain areas and serves customer that their needs based on their
living area or local preference. However, demographic is a process of Dividing the market into
groups based on variables such as age, gender, family size, family life cycle, income,
occupation, education, religion, race and nationality. Psychographic segmentation tries to
divides buyers into different groups based on psychological/personality traits, lifestyle or
values. But, people in the same geodemographic group can have different profiles. Lastly,
behavioural segmentation divides buyers into groups based on their knowledge of product,
their attitude towards it, the way they use it, and their responses to it. Behavioural
segmentation itself still divided into many variables such as user status, usage rate, buyer-
readiness stage, etc.
The table below describe the segmentation variables for a domestic business class
ticket:

Business travellers Holiday travellers


Value/ benefit sought Less time consuming comfortable
geographic Short and long-distance Long distance travellers
travellers
demographics Buying tickets without Travelling with family,
considering about price too searching cheaper flights
much, searching for the since there are many options
most effective way to go
somewhere
Behaviour(usage level) light rarely

Based on the table, it represents the two targeted consumers which is business
travellers and holiday travellers, and also three variables that affects the consumer’s
purchases. The first thing is the travellers will consider the value or benefit that they get if
they purchase the tickets. In this case, the business travellers can save their time because

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travelling with airplane is less time consuming. Whereas, the holiday travellers using airplane
because it is more comfortable especially for them who travel with family. Based on the
segmenting variables, geographic variables tell that the most of business travellers that use
the airlines travel to either short and long-distance place. But most of the holiday travellers
who use the airlines travel to long distance place. However, the business travellers buying
tickets without considering about the price too much since it’s their necessity, but travelling
for holiday purpose is not necessity but luxury so it will be more options. Business travellers
tend to use airline more often because they are busier than the holiday travellers.

3B. Using the example of Adidas’ FUTURECRAFT initiative to create fully recyclable clothing,
discuss the three (3) ways in which marketers can evaluate market segments. (50%)
In evaluating different market segments, a company/firm must look at three different
factors which are segment size and growth, segment structural attractiveness, and company
objectives and resources. The first step is to determine the segment size and growth. This
step shows how Firms want to select segments that have the right size and growth
characteristics. After selecting the segment size and growth, the next step is to Segmenting
structural attractiveness. In this step, the firm will analyse the following, current and potential
competitors, threat of substitute products, the power of buyers and the power of suppliers.
Finally, after analysing the competitors, threads, and the power of buyers and supplier, the
last step is to consider company objectives and resources. This step is important because
segmentation must be consistent with the organization’s goals.
The first thing that Adidas must do while evaluate market segment is determine the
segments that have bigger opportunity for Adidas in the long term. The changes in the society
may have impact in the economic growth. This step shows that Adidas must search which
segments they can enter. After that, they also have to consider the cultural characteristic
because it affects how people think, the willingness of the buyers to buy the product, the
suppliers that will supply the raw materials, etc. In conclusion based on the video, Adidas
targeted market is young people that like using sneakers and also people that concern with
the environmental issues. So that the buyers will support the Adidas act that recycle the shoes.
Lastly, Adidas must pay attention on their ability to produce those products. They have to
consider the goals and maintaining everything so it will be related and consistent with the
firm’s purpose.

4A. Use examples of your choice to demonstrate the use of each of the four (4) market
targeting strategies that a firm can employ. (50%)
A company must select their targeting strategies and choosing most profitable
segment to serve. The targeted market is one set buyers who share common needs or
characteristic that the firm decides to serve. There are 4 targeting strategies, which is
undifferentiated, differentiated, concentrated (niche), and micromarketing.

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- Undifferentiated: The company decides to ignore market segment differences and uses
a marketing strategy that is intended to appeal to as many people as possible.
Undifferentiated can serve higher market with low marketing cost since they are not
differentiating their targeted market. For example, toothpaste (such as Pepsodent brand)
isn’t made their product specially for one consumer, and it’s sold in huge quantities.

- Differentiated Marketing: A market coverage strategy where a company decides to target


several market segments and designs separate offers for each. For example, Toyota as a car
manufacturer produce many kinds of cars, their targeted customers can be a person who
wants to buy city car, family car, or pickup car.

- Concentrated (Niche) Marketing: A market coverage strategy where a company goes after
a large share of one (or a few) submarkets i.e. one particular segment. For example, Gucci
that focus on selling goods for people who interested in fashion and also people that like to
buy luxury clothes or fashion items.

- Micromarketing: Tailoring products and marketing programs to the needs and wants of
specific individuals. The micromarketing strategy focusing their product or service for each
customer.
Local : batik (needs/wants for local consumer groups)
Individual: (individual) For example, custom shampoo and conditioner by Function of Beauty.
4B. Draw and justify a product positioning map for one (1) of the following products. Ensure
that you include at least three (3) competing offers in your positioning map. You are not
allowed to look at both price and quality as variables together.: (50%)

1. Renova Black Toilet Paper 6 Roll


2. Virgin Australia Economy Getaway Class Flight
3. Lululemon Down For It All Running Winter Jacket

Positioning describes how the target market perceives the organization’s offer relative
to competing offers. It is how the customers distinguish a company, its brands and products
from competitors when they are selecting from available alternatives.

Winter Jacket
Fashionable
Gucci

H&M
Adidas
Low price High price
Lulu Lemon

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Unfashionable

Gucci: is one of the most famous designer brand that have very unique and fashionable
design. Their targeted market is people that interested in fashion and people that like to buy
luxury goods.

H&M: is a clothing brand that sell fashion goods for teens. Their most targeted customers is
teenagers and young adult. Teens usually buying goods that is on trend. That’s why H&M
provides and sells winter jacket with many various model and colors but with the affordable
price.

Adidas: Adidas is a brand that sells sport apparels including winter jacket. The price is
approximately $100 so, it is cheaper than Lulu Lemon. But Adidas it’s less fashionable than
Gucci since Adidas design their product for people that like sporty goods. The design usually
simple and they only provide neutral colors.

Lulu Lemon: is a brand that sells cheaper winter jacket than Gucci. But it is still more expensive
when compared to H&M and Adidas, because it is made from Glyde fabric that makes the
winter jacket become wind and water resistant. Based on its website, Lulu Lemon prioritized
their quality. So that’s why their product doesn’t available with too many colors or designs.

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