1 the consumer part 1: needs & wants, consumer demand, product life cycles

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THE CONSUMERTHE CONSUMERPart 1:

Needs & Wants, Consumer Demand, Product Life Cycles

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The ConsumerThe Consumer

A consumer is the person who uses the product.A customer is the person who buys the product.

• Wouldn’t this be the same person? Some examples when they are not?

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The ConsumerThe ConsumerIn the case of a parent or guardian of a child, the parent is considered a gatekeeper—a person who oversees the care of another.

• Marketers attempt to appeal to the gatekeeper as well as the consumer. Why?

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•Who is the Customer?

•Who is the Consumer?

• Who is the Gatekeeper?

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Another Scenario: Customer vs Consumer

Who is this?

Customer

... the Fans...(consumers)

Who is the Customer?

Where does he fit in “the Marketing Mix”?

the

PRODUCT(Derrick Rose)

...and the Consumer is...

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Consumer BehaviourConsumer behaviour is based on how the marketing mix interacts with the psychology of the Buyer. Buyer psychology includes their own culture, attitude, previous learning, and personal perceptions.

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Needs and WantsNeeds and Wants

self-actualization/fulfillment

esteem

belonging

safety

physiological

Maslow’s Heirarchy of Needs

It all comes down to:

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In our society, most people do not have difficulty satisfying needs.

Wants are items not necessary for survival, but add pleasure and comfort to our lives.

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In places with poverty, war, or oppression basic needs may not be met. Marketing focuses on meeting needs.

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In developed countries, demand is more driven by wants. Marketing presents alternatives, and helps customers set up value equations for each.

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Consumer DemandConsumer Demand

Consumer demand changes based on economic shifts and availability of new products.

economy is stable unemployment down

demand for goods and services UPpeople will buy things they want

economy is in a slump unemployment up

demand for goods & services DOWNpeople will only buy things they need

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Consumer DemandConsumer Demand

Demand also changes based on wants, needs, or changes in perceived value. Marketers need to make decisions based on:

• educated guess, research, historic trends

Former Marketing Market Guru

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Consumer DemandConsumer DemandDemand changes as retailers enter/exit the marketplace.

• Too many sellers of a product = demand

• As some close, less product available = demand

Misreading a market can mean disaster >

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Humour BreakActual Consumer labels

> On a Sears hairdryer: Do not use while sleeping.

> On a bag of Fritos: You could be a winner! No purchase necessary. Details inside.

> On a bar of Dial soap: Directions: Use like regular soap.

> On Boot's children's cough medicine: "Do not drive a car or operate machinery after taking this medication."

> On Nytol sleep aid: Warning: May cause drowsiness.

> On an Airline packet of peanuts: "Instructions: Open packet, eat nuts."

> On a child's Superman costume: "Wearing of this garment does not enable you to fly.“

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ConsumerConsumer Demand DemandUnderstanding fluctuations in consumer demand is essential to marketing. Because of this, marketers also use product life-cycle models to predict the life of new products.

• no product can be in demand forever see http://www.crazyfads.com/

• trends, technology and lifestyles change, affect consumer demand

http://www.crazyfads.com/

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The traditional PLC consists of four stages

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Nontraditional Nontraditional Product Life CyclesProduct Life Cycles

These include: Fads, Trends, Niche Markets, and Seasonal Markets.

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Nontraditional Product Life CyclesNontraditional Product Life Cycles

Fads

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FadsA product which is extremely popular for a very brief period of time, and loses popularity just as quickly.

Rubik’s cube, Cabbage Patch Kids, tamagotchi, Pet rock…(you researched this already)

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FadsFads are unpredictable, and high-risk. Companies try to get out of the market just as the fad peaks. If they wait too long, they get stuck with excess inventory.

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Trends

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TrendsA trend has a more lasting effect on the market than a fad. A trend is usually a movement towards a style of product.

Organic foods, Beanie babies, the Simpsons, cell phones

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Niche Markets

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Niche MarketsA small section of the market dominated by a small group of products that meet real, but unique needs and wants.Short growth, level maturity, limited competition.

Great Niche Market Entrepreneurs:Great Niche Market Entrepreneurs:Alex Tew: The Million Dollar Homepage.

This website was conceived in 2005 by Alex Tew, a college student from Wiltshire, England. The purpose of the website was to raise money for his college education. The home page consists of a million pixels arranged in a 1000 × 1000 pixel grid; the image-based links on it were sold for $1 per pixel in 10 × 10 blocks. Alex’s ultimate goal was to sell all of the pixels in the image, thus generating a million dollars of income. He achieved that goal on January 11, 2006, when the final 1000 pixels were put up for auction on eBay. http://www.milliondollarhomepage.com

Marla Cilley: FlyLady Who knew being a professional nag could be so profitable? Marla Cilley, “FlyLady” makes millions by nagging her approximately 550,000 e-mail subscribers known as “Flybabies”, to do things such as get up and get dressed for work, polish their sink, get their nails done, cook dinner and yes…go to bed! In 2010, sales of Marla’s nag business reached 4 million. Marla’s website: http://flylady.net

Sami Bayrakci: SomethingStore Do you like surprises? SomethingStore is a website launched in October 2007, that will send you “something”, randomly selected from thousands of products in their diverse inventory, for $10 (free shipping in the US), and you will discover what your something is when you receive it. http://www.somethingstore.com

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http://www.milliondollarhomepage.com/

http://flylady.net/

http://www.somethingstore.com/

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Seasonal Markets

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Nontraditional Product Life CyclesNontraditional Product Life CyclesSeasonal MarketsConsumer demand changes and is effected by the weather. Marketers anticipate periods of high and low demand, and work to create off-season opportunities.Ice cream parlours, resorts, lawn mowers, snow shovels, ice skates

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Joke BreakJoke BreakTEACHER: Why are you late?

WEBSTER: Because of the sign.

TEACHER: What sign?

WEBSTER: The one that says, "School Ahead, Go Slow."

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Why don't cats play poker in the jungle?

Too many cheetahs

Another Joke Another Joke BreakBreak

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ACTIVITYACTIVITY

My FivesAt your tables, try to identify five specific products which follow each of the non-traditional PLCs. (The ones presented in class do not count!)

PRIZES FOR BEST TABLE!

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a) Go to the Course Web page, Unit 2 and copy the questions for this PPT into a blank Word file. Transfer your own answers under each question, put your name at the top of the file.

b) Add the notes from the “My Fives” Activity to the end of the above questions/answers.

c) For a mark, save your completed file using the following file name: FirstName_Lastname_Consumer_P1.doc

d) Drag the file into the correct folder (by day and period) into the Drop-Off>ROBINSON folder.

ASSIGNMENT (for Marks)Part 1:

Needs & Wants, Consumer Demand, Product Life Cycles

1 the consumer part 1: needs & wants, consumer demand, product life cycles

Documents

consumera consumer

consumer demanddemand

product available

meeting needs

product lifecycle models

oppression basic needs

marketing mix

life of new products