Dena Ayzikovich Essay Question 2

10/04/2012 MKTG 20001

Marketers have realized that in order to outperform competitors, they must focus on customer satisfaction, or the individuals perception of the performance of a product or service in relation to his or her expectations ((Schiffman et al. 2005, pp. 23). In order for a customer to be satisfied with a marketers product, they must engage in the consumer decision-making process, which includes recognising a need, searching for information, evaluating alternatives, completing the purchase, and a post-purchase analysis. This plays an important part in company profitability, because satisfied customers tend to make repeat purchases and generate greater revenues. In order to achieve customer satisfaction, marketers must understand that most consumers have limited time, motivation and risk-taking initiative, so they must be assisted in the decisionmaking process. Marketers must first determine which decision-making unit they are targeting their product to. Decision-making units include the initiator, influencer, buyer, payer, and user. The company must decide who usually has the greatest influence in the purchase of the product, or, attempt to target and satisfy all of these units. The first step in the consumer decision-making process that these units engage in is need recognition, which occurs when the difference between actual state and desired state is above the threshold level set by the consumer (Schiffman et al. 2005, pp. 474). Marketers can have a direct effect on a physiological or social need recognition when the consumer engages in a pre-purchase information search. If a consumer does not have enough internal information from experience, they have to do an external search based on marketing and

non-commercial information. Typically, the less consumers know and the more important the purchase is, the more time they will spend searching. However, research confirms that little external search is done by the consumer even if they would benefit from the additional information, which is likely caused by limited time or motivation (Solomon and Rabolt 2004). This can be solved by providing consumers with easily available and processable information. For example, shopping in stores was regarded as the most important source of fashion information because it is readily accessible, requires little effort, and marketers use display techniques to make garments look attractive (Staden and Aardt 2011). Marketers have also taken advantage of the internet as an easy way for consumers to receive information. Therefore, companies should provide effortless ways to learn about their product or service, as consumers tend to undertake limited information searches. In the third step of the decision making process, consumers evaluate potential alternatives using a list of brands from which they plan to make their selection, and a list of criteria to evaluate each brand. Products do not end in purchase if the brand is perceived as: unknown because of consumers selective exposure to advertising media; unacceptable because of poor or inappropriate positioning; indifferent; overlooked because it is not clearly positioned or targeted to their market segment; or unable to satisfy consumers perceived functional or symbolic needs. To prevent this outcome, marketers should use promotional techniques to expose target consumers to a more favorable, relevant product image (Schiffman et al. 2005, pp. 478-480). This may require a change in product features or attributes; however, perceptions of symbolic inferiority are difficult for marketers to change (Paladino). Products or services can also be deemed unacceptable when evaluating alternatives because of the consumers level of perceived functional, physical, financial, social and time risk associated with the brand. Techniques such as

free samples, test drives, and coupons are used by marketers to minimize the risk perceived and enhance preferences for the good (Schiffman et al. 2005, pp. 482). In order to facilitate the brand choice, consumers often use compensatory decision rules, which allow trade-offs among attributes, or non-compensatory, which do not. These rules are used to limit information processing, which supports the point previously made that humans limit the effort exerted during the decision-making process (Bettman, Johnson and Payne 1991, pp. 57). They are important in marketing strategy because a marketer familiar with the prevailing rule can create promotional messages in a format that facilitates consumer decision making (Schiffman et al. 2005, pp. 488). For instance, in 2011 AT&T developed a series of advertisements stating that they had the best coverage worldwide, which suggests that quality should be the highest-ranked attribute for consumers using the lexicographic decision rule (AT&T). Consequently, in order for a companys product or service to be selected during the alternative evaluation process, marketers must create a relevant promotional message that emphasizes the lack of risk involved and that supports the typical decision rule used. After the consumer determines what product and brand to use, they must decide when and where to make their purchase. Consumers may complete a trial purchase, which is usually of a smaller quantity and can be encouraged through promotional tactics such as competitions, samples and sale prices. Marketers hope that this will turn into a repeat purchase, which signifies that the trial product met the customers approval. For unplanned purchases, variables such as music, lighting, colour, and crowding in the atmosphere of the retail setting might affect purchase (Schiffman et al. 2005, pp. 489). For example, a significant correlation was found between music-retail consistency and behavioral intention to purchase (Vaccaro 2009). Within this atmospheric context, packaging provides identification, quality and safety information that

differentiates the product from others in the category, thus facilitating the alternative evaluation and purchase stages of the consumer decision-making process (Butkeviien, Stravinskien and Rtelion 2008). After product consumption, the consumer evaluates their degree of satisfaction or dissatisfaction with the use of the product or service. The consumer is satisfied when the performance meets or exceeds expectations, and will repeat their purchase and give favorable word of mouth. This is the end goal of marketers, as it is easier to retain existing customers than to attract new ones. Otherwise, they may switch to a competitor, engage in negative word of mouth or complain (Schiffman et al. 2005, pp. 491-492). In order to achieve customer satisfaction and retention, marketers thus must create a favourable, informative retail environment. Consequently, marketers must understand that even if consumers have limited knowledge, they will still engage in a minimal information search and evaluation of alternatives. This is because individuals often lack the time or motivation to properly research and differentiate amongst various alternatives. Marketers thus must provide readily accessible product information that is clearly positioned to the target audience, and emphasizes the lack of risk involved with purchasing the product. These actions will increase the likelihood that customers will be satisfied and remain loyal to the brand.

References AT&T. Advertisement. Clever and Creative ATT Advertisements 2011. May 2011. Web. 10 Apr. 2012. <http://funniestarea.blogspot.com.au/2011/05/clever-and-create-attadvertisements.html>. Bettman, James R., Eric J. Johnson, and John W. Payne (1991), "Consumer Decision Making," in Handbook of Consumer Behavior, eds. T.S. Robertson and H.H. Kassarjian, Englewood Cliffs, NJ: Prentice-Hall, 50-84. Butkeviien, V., Stravinskien, J., & Rtelion, A. (2008). Impact of Consumer Package Communication on Consumer Decision Making Process. Engineering Economics, 56(1), 57-65. Paladino, Angela. Consumer Decision Making. Consumer Behaviour. University of Melbourne. Melbourne, March

Schiffman, Leon G., David Bednall, Aron O'Cass, Angela Paladino, and Leslie Kanuk. Consumer behaviour. 3rd ed. Frenchs Forest, N.S.W.: Pearson Education Australia, 2005. Print.

Solomon, M.R. & Rabolt, N.J. (2004) Consumer Behaviour in Fashion. Prentice Hall, New Jersey. Vaccaro, V. L., Yucetepe, V., Torres-Baumgarten, G., & Myung-Soo, L. (2009). The Impact of Atmospheric Scent and Music-Retail Consistency on Consumers in a Retail or Service Environment. Journal Of International Business & Economics, 9(4), 185-196.

van Staden, J., & van Aardt, A. (2011). Information seeking by female apparel consumers in South Africa during the fashion decision-making process. International Journal Of Consumer Studies, 35(1), 35-49