BUS630: Consumer Behavior

7a. Explain how we are motivated to buy or use products in order to be consistent with what other people do

• How might others influence the consumer buying process?
• Can our social circle influence buying decisions? If so, how?
• What factors might influence buying habits?

Most of us believe we have complete control over what we buy. But many times, other things influence our buying process. Sometimes, it might be family, friends, social media, or coworkers. Or we may feel the need to compete with other people, and many times, these feelings or thoughts may not be something we are consciously aware of.

Our social circle can influence our buying decisions, which might vary from small to large purchases. For example, if your neighbor Buys a new electric car, you may feel the need to also buy one. This might depend on your relationship with your neighbor or the feeling that you need to compete with your neighbor.

Your relationship with others may depend on values or beliefs and how similar they may be. Some social factors that influence your decision-making process may include family, culture, social class, or even groups you belong to. Someone in your family may buy a product that you like, and you may wish to also buy that product.

To review, see Social Factors and Social Influences.

 

7b. Explain how consumers' word of mouth (both positive and negative) is often more influential than advertising campaigns

• How does word of mouth work as it relates to marketing?
• Why are some people more influential than others when purchasing a product?
• What is the difference between a word-of-mouth and an advertising campaign?

Do you have a friend who gets excited when they find a product they like? They may tell you about it, send you videos, and explain how much they love that product. Most likely, that person will influence a dozen people to buy the same product. This is called word-of-mouth marketing. Although your friend is most likely not receiving monetary compensation for telling people about their favorite new product. Companies love word-of-mouth marketing because it is inexpensive and effective.

With social media today, these types of people can influence followers. Their word-of-mouth marketing reaches more people than they would connect with in a one-on-one conversation. These influencers can have quite a bit of power in that social circle. Sometimes, these people have a magnetic personality that naturally gets people excited about something.

An advertising campaign may reach quite a few people but may not be specifically promoted to the target market. However, an influencer can target a specific market and may cover numerous similar products. For example, a makeup influencer may try many different products and have people who follow them on social media to gain tips and tricks on applying makeup. In contrast, an advertisement in a magazine promotes to a general audience that may not include people interested in makeup.

To review, see Social Influences.

 

7c. Assess how online technologies are accelerating the impact of word-of-mouth communication

• How can word-of-mouth techniques be promoted online?
• Could a marketing company promote a word-of-mouth consumer campaign? Why or why not?
• How can social media be used to promote successful consumer product reviews?

One of the ways that word-of-mouth communication can reach quite a few people is through social media. A decade ago, people could post something on a social page about something they were excited about. But today, they may have hundreds of thousands of followers and can reach a larger audience. Many of these influencers have perfected the art of promoting products by editing videos and giving ideas about how the product might be used.

Marketing companies may support these social media influencers and create a similar word-of-mouth campaign by using their own influencers. For example, many companies now share blogs and video blogs describing uses for various products they sell. For example, a heating, ventilation, and air-conditioning (HVAC) company may ask a marketing company to write blogs and video blogs for their website. These videos may show products that they sell or give ideas to homeowners who have issues with their HVAC, and they offer an opportunity to connect with potential buyers while setting themselves up as the experts in that area.

To review, see Social Influences.

 

7d. Identify how social networking is changing the way companies and consumers interact

• How has social networking changed over the last two decades?
• How can a company use social media to their advantage when promoting products?
• What can a company do to encourage online consumer interaction?

Social media has changed quite a bit over the last couple of decades, and with marketing, it has become specifically targeted to consumers who need products or services.

Social circles, social networking, and online consumer interaction are other ways companies can interact with customers. By creating a business social media page, consumers can follow the companies and have their posts appear on their feeds. Customers can also ask questions by posting information about a problem and looking for a solution. This interaction helps companies to better connect with their customers daily.

Companies can also use direct advertising on social media to reach their target market. For example, do an online search about carpet cleaning because you need the service. You may see a carpet cleaning advertisement show up almost immediately on your social media. This is targeted advertising specifically to you, and if this same company has a social media page, you can connect directly with that company through social media and avoid having to make a phone call.

To review, see Social Influences.

7e. Identify the demographic factors that relate to family and household structure

• Can you name three demographics that marketers might use that relate to family?
• Can you name three demographics marketers might use that relate to household structure?
• Why is it important for marketers to use demographics?

Demographics are basic information about consumers that marketers can use to better understand consumer buying habits. Demographics might include age, sex, race, education level, homeowners, etc. Demographics are essential statistics that help to describe populations.

When it comes to family and household structure, the family demographics that might be used are the size of the family or the head of the household. For example, in the United States, we can investigate statistics that show which states have the largest families and what those averages are. Marketing companies can then use this information to target larger families with household advertising or family needs.

A few years ago, a teenage girl purchased a pregnancy kit at a store, and while checking out, she used her parent's phone number to take advantage of rewards. A few weeks later, that store sent promotional items and congratulations to the family about prenatal vitamins for the new baby. This is how the family found out their teenage daughter was pregnant. In this case, the marketing was very specific and targeted the correct market, but it missed the mark on the discrepancy.

To review, see Demographic Influences.

 

Unit 7 Vocabulary

This vocabulary list includes terms you will need to know to successfully complete the final exam.

• family demographics
• online consumer interaction
• social circles
• social media influencers
• social networking
• word-of-mouth marketing