Motivation Process Model

The psychological concepts used for optimizing the marketing mix:

1.      1. Perception – Perception is the process of giving meaning to the stimulus.

            Perception Mapping

1.       Quality – High & Low

2.       Price – High & Low

            Elements of Perception:

1)      Sensation   

2)      Absolute Threshold               

3)      Differential Threshold                           

4)      Subliminal Perception           

5)      Habituation

Perceptual Selection: Depends on two major factors

A)     Internal Factors – Interest, Needs, Motives, Expectations

B)      External Factors – Intensity and Size, Position, Contrast, Novelty, Repetition, Movement

2.       2.Motivation – 1) Rational Ex. Cause and effect details, Cost-benefit analysis         

                        2) Emotional (no reason)

                        Motive – A driving force which makes an individual to act/response.

3.      3.Attitude – It’s a pre-disposition which is learnt over a period of time towards certain object. 

                 Tri-Component Attitude model:

1.       Knowledge (about information)

2.       Feeling (about emotions)

3.       Behavioural Tendency

4.       Personality – The sum total of all psychological characteristics which determines and influences the behaviour.

5.       Learning – The way you do what you do.

Consumer Behaviour and Market Research

Faculty: Dr. S.M. Dhume

Dr. Ankush Sharma

Recap of Lecture 3

Prepared by:mithlesh,PGDIM-18,Roll no.74

In today’s class first we did the revision of first two classes and then following topics were covered:

1. What is CB?

2. Why do we study CB?

3. Approaches

4. Modelling

5. Types of buying behaviour.

What is CB?

CB is a subset of human behaviour i.e. CB is a part of total human behaviour. Total human behaviour means how a person behave socially ,politically .A person behave in a different way in different situation .CB is a study of buying behaviour of a person i.e. what is the behaviour of a person before buying, during buying and after buying.

Now what is behaviour?

Behaviour is a response (effect) to a stimulus (cause)

       For every effect there is a cause and for every cause there is effect.

Stimulus (cause)                                                                                     response (effect)

Response is determined by the stimulus .To get desired positive response, stimulus must be appropriate.

Now if response is only determined by stimulus then all individual should have same response for a given stimulus but it is not so. Why   ?  Because of different filter, no two individuals can not have   same behaviour even if they are twine (but can have similar behaviour  ,the task of segmentation is identifying and grouping the individual who has similar behaviour).

                                                                                      Filter

Stimulus (cause)                                                                                                                        response (effect)

What is this filter and how it is created?

Every human being has some accumulated knowledge by birth .In human being knowledge get passed from one generation to the next and then every person born and bought up in different situations. Every one of us studied in different school  ,grown up in different cultures, spending time among different people ,have different parent so all of us are different in one way or other.

So our response not only depends on stimulus but on filter also

CB is the sum of response ,filter and stimulus

What answers CB gives:

Who is the customer ,why he is buying ,how he is buying ,from where he is buying ,when he is buying, how much he is buying.

A marketer must know the answer of these questions and to get there answer he should have knowledge of CB then only he can do the segmentation ,targeting, positing and can attract the customer.

Why do we study CB?

1.To understand the philosophy of marketing/marketing concepts ,you should have prior knowledge of CB.There are five marketing concepts:

i)product concept:This orientation hold that customer will favour those products that offer most quality, performance or innovative features.Managers focusing on this concept concentrate on making the superior products and improving them over time.

ii)production concept :It hold that consumer will prefer that products that are widely available and inexpensive .Managers focusing on this concept concentrate on achieving high production efficiency ,low cost and mass distribution.

iii)selling  concept :It hold that consumer and business if left alone will ordinarily not buy enough of products. The organisation must therefore undertake an aggressive selling and promotion effort. This concept  assume that consumer typically show buying inertia or resistance and must be coaxed into buying. It also assumes that the company has a whole stoke of effective selling and promotional tools to stimulus more buying .Most firms practice the selling concept when they have overcapacity. Their aim is to sell what they make rather then make what market wants.

iv)marketing concept:It hold that to achieve its goal company must be more effective then competitor in creating ,delivering and communicating value to the customer .The marketing concept rest on four pillars namely target market, customer need, integrated marketing and profitability.

What is the difference between sales concept and marketing concept?

The sales concept is preoccupied with the sellers need to convert his product into cash.The marketing concept is preoccupied with the idea of satisfying the need of the customer by mean of product as a solution to the customers problem (need).

v) Mass marketing concept :It is a marketing converging  strategy in which firm ignore market segment differences  and go after the whole market with one offer .The idea is to broadcast a message that will reach the largest number of people possible.

2 .To be successful in marketers job , you need to study CB.

Marketers job is to create appropriate stimulus to get desired responses like getting convinced, buying, satisfaction of customer, reuse of product  ,positive word of mouth by the customer.

3. study of CB facilitate marketing decision like how to survive ,grow, retention of customer ,giving satisfaction to the customer.

What is satisfaction? It is the relationship between performance and expectation.

If expectation<performance, customer will be dissatisfied .He will not come back because he has other options .and also he will spread the negative word of mouth about the product.

If expectation =performance  ,customer will be just satisfied .A just satisfied customer may shift to competitor even with small incentive by the competitor.

If expectation >performance, customer will be delighted .It will result in retention of the customer. A delighted customer spread positive word of mouth about the product .A delighted customer will even gives the chance if u fails.

Is under promising and over delighted is appropriate to delight the customer ?No. Because  customer will not get attracted to your offering and he may choice your competitors more attractive offer. so overpromising is appropriate ?No. overpromising and over delivering is the best way to delight the customer.

4.In branding the study of CB is needed

The problems faced by customer: many options, limited time and energy .So solution is turning to brand. Buying a branded product among many options save time and energy which a customer can use in other thing.

Commodity: commodity is a unbranded product. Product is a commodity. For a   commodity it very difficult to seek attention so the commodity needs branding.

                                                                                                                                                               Brand awareness

Marketing             commitment          differentiation          brand          brand equity  

                                                                                                                                                                 Brand association

Marketing needs the commitment of the customer which comes when you differentiate yourself from your competitor. Today differentiation is a big challenge you cannot distinguish yourself on the objective attributes because they can be copied ,cannot distinguish by technology because everyone has almost same technology ,you can only distinguish yourself on the subjective  attributes (image associated with the product).to create the brand you need brand equity.Brand equity comes from

1.Brand awareness: if the customer can recall your product and how well he is aware about the product.It lead to high brand equity.

2.Brand association like pepsi associated with youthness, phenyl with cleanliness  etc

Approaches

Introspective: analysing own behaviour at the instant of buying.

Retrospective : analysing own buying behaviour after buying the product.

Prospective: analysing others buying behaviour.

Prescriptive: asking questions to potential buyer about their buying behaviour.

Modelling

CB models:

-describe the phenomena of buying ; what it is.

-explain the buying phenomena ;why it is the way it is.

-predict what is likely to happen.

-control the CB behaviour.                                                   

Popular CB model is black box.Here black box refer to consumer mind.when the mind get the stimulus it starts processing and then respond accordingly.

Stimulus/input/cause                                                  process                                                response/output/effect

Stimulus type:

1. uncontrollable-which can not be controlled by the marketers .example inflation, what your competitors are doing.

2. controllable-which can be controlled by marketer. example price, product, promotion, place i.e. marketing mix.

Promotion mix:advertising,sales promotion,publicity,personal selling

Advertising: it involves non personal , mostly paid promotion after using mass media outlets to deliver the marketers message .

Sales promotion: in this incentive is given to increase the sale. example discount.

Publicity: it use third party source particularly news media to offer a favourable mention of the marketers company or product without direct payment to the publisher of the information.

Personal selling:it involves personal contact between buyer and the seller.

                All elements of marketing mix acts as a stimulus .marketer has control over all of them. Than this stimulus is processed is the customers mind.

How the processing takes place.

-perception:it is the process of giving the meaning to the stimulus .perception is more important then reality for a marketer.if perception is positive the behaviour would be positive.perception mapping can be use to study perception.                                        Quality

                                                              Surf                                         tide

                                     Price                                                             

                                                                                                              Nirma

-motivation: it is the driving force that make the individual to respond or act. There is a gap between prevailing and desirable. Motivation fill this gap .if there is no gap, there would be no motivation.

                          Prevailing                                                            desirable

Motivation type-

Rational: customer compare cost and benefit before buying .In this there is always a reasoning in buying.

Emotional: no reasoning in buying

What is the difference between perception and motivation?

Perception is inside the customer and motivation is outside deriving force.

-attitude: it is the predisposition which is learned over a period of time toward certain object. If you have positive attitude toward the object then your behaviour would also be positive.

Triattitude attribute model:

Knowledge-is about information.

Feeling-is about emotion.

Behavioural  tendency.

Behaviour is determined by feeling and feeling is determined by knowledge.

VALS Framework

US Framework and VALS™ Types

VALS™ segments US adults into eight distinct types—or mindsets—using a specific set of psychological traits and key demographics that drive consumer behavior. The US Framework, a graphic representation of VALS, illustrates the eight types and two critical concepts for understanding consumers: primary motivation and resources. The combination of motivations and resources determines how a person will express himself or herself in the marketplace as a consumer.

VALS assigns individuals a VALS type on the basis of their responses to questions in theVALS Survey. VALS-typing populations of interest, such as customers or constituents, is the first step in a VALS approach to achieving strategic marketing and communication goals.

Using VALS provides clients with:

• A fresh perspective by effectively "putting them inside the head" of their customers
• Rich, customized, consumer profiles or personas
• Distinctive communication styles of their best targets.

Primary Motivation: Ideals, Achievement, and Self-Expression

The concept of primary motivation explains consumer attitudes and anticipates behavior. VALS includes three primary motivations that matter for understanding consumer behavior: ideals, achievement, and self-expression. Consumers who are primarily motivated by ideals are guided by knowledge and principles. Consumers who are primarily motivated by achievement look for products and services that demonstrate success to their peers. Consumers who are primarily motivated by self-expression desire social or physical activity, variety, and risk. These motivations provide the necessary basis for communication with the VALS types and for a variety of strategic applications.

Resources

A person's tendency to consume goods and services extends beyond age, income, and education. Energy, self-confidence, intellectualism, novelty seeking, innovativeness, impulsiveness, leadership, and vanity play a critical role. These psychological traits in conjunction with key demographics determine an individual's resources. Various levels of resources enhance or constrain a person's expression of his or her primary motivation.

Innovators are successful, sophisticated, take-charge people with high self-esteem. Because they have such abundant resources, they exhibit all three primary motivations in varying degrees. They are change leaders and are the most receptive to new ideas and technologies. Innovators are very active consumers, and their purchases reflect cultivated tastes for upscale, niche products and services.

Image is important to Innovators, not as evidence of status or power but as an expression of their taste, independence, and personality. Innovators are among the established and emerging leaders in business and government, yet they continue to seek challenges. Their lives are characterized by variety. Their possessions and recreation reflect a cultivated taste for the finer things in life.

Favorite Things:

• BMW
• Wired
• sparkling water
• a rewarding experience

Thinkers are motivated by ideals. They are mature, satisfied, comfortable, and reflective people who value order, knowledge, and responsibility. They tend to be well educated and actively seek out information in the decision-making process. They are well-informed about world and national events and are alert to opportunities to broaden their knowledge.

Thinkers have a moderate respect for institutions of authority and social decorum but are open to consider new ideas. Although their incomes allow them many choices, Thinkers are conservative, practical consumers; they look for durability, functionality, and value in the products that they buy.

Favorite Things:

• Subaru
• Kiplinger's Personal Finance
• a glass of wine
• a substantive discussion

Like Thinkers, Believers are motivated by ideals. They are conservative, conventional people with concrete beliefs based on traditional, established codes: family, religion, community, and the nation. Many Believers express moral codes that have deep roots and literal interpretation. They follow established routines, organized in large part around home, family, community, and social or religious organizations to which they belong.

As consumers, Believers are predictable; they choose familiar products and established brands. They favor U.S. products and are generally loyal customers.

Favorite Things:

• Mercury
• Cooking with Paula Deen
• local TV news
• a close-knit family

Motivated by the desire for achievement, Achievers have goal-oriented lifestyles and a deep commitment to career and family. Their social lives reflect this focus and are structured around family, their place of worship, and work. Achievers live conventional lives, are politically conservative, and respect authority and the status quo. They value consensus, predictability, and stability over risk, intimacy, and self-discovery.

With many wants and needs, Achievers are active in the consumer marketplace. Image is important to Achievers; they favor established, prestige products and services that demonstrate success to their peers. Because of their busy lives, they are often interested in a variety of time-saving devices.

Favorite Things:

• Honda
• Every Day with Rachael Ray
• low-calorie domestic beer
• recognition at work

Strivers are trendy and fun loving. Because they are motivated by achievement, Strivers are concerned about the opinions and approval of others. Money defines success for Strivers, who don't have enough of it to meet their desires. They favor stylish products that emulate the purchases of people with greater material wealth. Many Strivers see themselves as having a job rather than a career, and a lack of skills and focus often prevents them from moving ahead.

Strivers are active consumers because shopping is both a social activity and an opportunity to demonstrate to peers their ability to buy. As consumers, they are as impulsive as their financial circumstance will allow.

Favorite Things:

• Chevrolet
• Playboy
• Coke Classic
• win the lottery

Experiencers are motivated by self-expression. Young, enthusiastic, and impulsive consumers, Experiencers quickly become enthusiastic about new possibilities but are equally quick to cool. They seek variety and excitement, savoring the new, the offbeat, and the risky. Their energy finds an outlet in exercise, sports, outdoor recreation, and social activities.

Experiencers are avid consumers and spend a comparatively high proportion of their income on fashion, entertainment, and socializing. Their purchases reflect the emphasis that they place on looking good and having "cool" stuff.

Favorite Things:

• VW
• Rolling Stone
• Red Bull
• to be entertained

Like Experiencers, Makers are motivated by self-expression. They express themselves and experience the world by working on it—building a house, raising children, fixing a car, or canning vegetables—and have enough skill and energy to carry out their projects successfully. Makers are practical people who have constructive skills and value self-sufficiency. They live within a traditional context of family, practical work, and physical recreation and have little interest in what lies outside that context.

Makers are suspicious of new ideas and large institutions such as big business. They are respectful of government authority and organized labor but resentful of government intrusion on individual rights. They are unimpressed by material possessions other than those with a practical or functional purpose. Because they prefer value to luxury, they buy basic products.

Favorite Things:

• Dodge Ram
• Field & Stream
• Budweiser
• NASCAR

Survivors live narrowly focused lives. Because they have few resources with which to cope, they often believe that the world is changing too quickly. They are comfortable with the familiar and are primarily concerned with safety and security. Because they must focus on meeting needs rather than fulfilling desires, Survivors do not show a strong primary motivation.

Survivors are cautious consumers. They represent a very modest market for most products and services. They are loyal to favorite brands, especially if they can purchase them at a discount.

Favorite Things:

• an American car
• AARP Magazine
• The 700 Club
• a home-brewed cup of coffee

Applications of VALS™

Innovation: New-Product Development

VALS™ consultants facilitate successful product launches and help avoid costly mistakes. Understanding the needs of various consumer groups guides new-product and services development.

Applications:

• Ideation
• Entry-Stage Targeting
• Concept Testing
• Focus Groups
• Features and Benefits
• Business Partnerships
• Distribution Channel

Representative Projects:

• A major wireless-device manufacturer used VALS to explore new opportunities to create consumer value. VALS developed a process to evaluate future consumer demand across a diverse set of new opportunities. The client used the results of the process to select product-development projects and portfolio investments.
• A European luxury automobile manufacturer used VALS to identify online, mobile applications that would appeal to affluent, early-adopter consumers within the next five years. On the basis of the VALS Innovation Diffusion model, the manufacturer identified early-adopter groups; it explored their reactions to a variety of mobile services for use in automobiles. The VALS analysis enabled the company to prioritize applications for development and determine the best strategic alliances to pursue.
• An international consumer-electronics firm used VALS to anticipate consumer demand for a new consumer media product for delivery over the Internet. By using VALS™/MRI data, the company was able to customize the product feature set and delivery style to meet the needs of two consumer targets.
• A major telecommunications-product company used VALS to select an early-adopter target for a new telecommunications concept. VALS enabled the company to develop the product prototype and prioritize features and benefits, with a focus on the early-adopter target. The company used VALS to select the best name and logo, choose an overall positioning strategy, and set an initial price point.

Targeting: Positioning

VALS™ consultants identify which market opportunities are strongest. Relating features and benefits to distinct segment needs clarifies strategies for targeting and expansion.

Applications:

• Competitive Analysis
• Brand Differentiation
• Target Selection
• Proprietary Research
• Linking of Data Sets
• Customer Retention

Representative Projects:

• A Japanese auto manufacturer repositioned its product line in the United States by using VALS to understand target consumer perceptions of its product mix better. The resulting advertising campaign, based on VALS, increased sales 60% in six months.
• A Minnesota medical center planned to offer a new line of service: cosmetic surgery. It used VALS™ Focus Groups to identify target consumers (people most interested in and able to afford the service). By understanding the underlying motivations of the target, the center and its ad agency were able to develop a compelling selling proposition. The resulting advertising was so successful that just a few weeks into the campaign, the center exceeded its scheduling capabilities.
• A leading U.S. bank used VALS™/MacroMonitor data from Consumer Financial Decisions to reposition several ubiquitous products in commodity categories. By understanding the emotional benefits sought by target consumers, the advertising agency was able to define unique selling propositions for each product that linked to the corporate branding strategy. The bank achieved about one-third of its customer-acquisition goal 12 weeks into the first campaign.
• One of the premier U.S. community real estate developers included VALS in a custom research survey of homeowners to increase the developer's understanding of which amenities would be most attractive to add to its communities. VALS enabled the developer to link its own research to nationally syndicated research from Mediamark Research & Intelligence, LLC (MRI) to identify a broad diversity of leisure preferences.

Communications: Channel Planning

VALS™ consultants show you how to craft more effective messaging campaigns. Understanding what motivates consumers illuminates how to speak to them in ways that will initiate action.

Applications:

• Value Proposition
• Brand Personality
• Creative Development
• Channel Planning
• Media Placement

Representative Projects:

• A large pension plan provider to the United States conducted a custom research survey of its participants, incorporating VALS to identify which of its participants it could service electronically. By understanding the motivations of these consumers, the provider was able to revise its Web site and communications to serve its participants' needs better.
• One of the largest U.S. financial institutions used VALS to create rich descriptive profiles of consumers and their needs based on VALS™/MacroMonitor and VALS™/MRI data to increase the efficiency and productivity of the institution's communications programs. The profiles enabled a consistent and shared vision of target consumers across all programs—one point of reference for the institution and its multiple advertising agencies.
• A prestigious international advertising agency used VALS to streamline channel planning and media placement for a national U.S. client. A more in-depth understanding of the client's target consumers through VALS™/MRI data also provided direction when assessing new and alternative media venues and new television programming and magazine titles for inclusion in media buys.
• An electric utility used VALS to increase participation in its energy-conservation program by developing a targeted direct mail campaign. Using VALS™/MRI data, the utility identified two distinctly different VALS segments as key targets. By developing unique strategies for each audience and identifying zip codes with high proportions of each target using GeoVALS™, the utility reported a 25% increase in participation.

Geolocation

GeoVALS™ links VALS™ marketing strategies to geographic locations. Find the most important geography for your business.

Applications:

• Direct Mail
• Market Potential
• Retail Locations
• Store-by-Store Evaluation
• Local Media Selection

Representative Projects:

• A U.S. cruise ship company used VALS in a custom research survey to identify and understand consumers most interested in its specialized tours. By designing direct mail creative to appeal to targeted consumers and mailing to key zip codes, the cruise line increased reservations 400%.
• A leading U.S. bank used VALS to identify target consumers for a credit product using VALS™/MacroMonitor. To understand which alternative media channels would yield the greatest visibility for the advertising in a large metropolitan market, the bank reviewed VALS™/Scarborough data. It employed GeoVALS™ to link the target's behaviors and media preferences in the single market to size the maximum market potential.
• A large regional retailer used GeoVALS™ in combination with zip codes of its credit-card customers to understand the types of consumers who were trafficking each of its stores. It evaluated target consumer groups' buying behaviors by using VALS™/MRI data to suggest higher potential per store retail-floor allocations and merchandise mix.
• A branch of the U.S. military incorporated VALS into a custom research survey to identify the best target for a recruiting campaign. Once identified, GeoVALS™ served at the state level to locate recruiting centers in which the military should focus efforts.

Policy

Federal, state, and local governments and other policy makers can use VALS™ to understand consumer acceptance of and resistance to current and future policy: Nonprofit organizations can benefit by better understanding contributors and volunteers.

Applications:

• Segmentation
• Thought-Leader Identification
• Campaign Ideation
• Theme Development
• Communications Design
• Donor Outreach
• Public Relations

Representative Projects:

• Using VALS in a custom research study, a municipal electric utilityused VALS to segment residential customers, understand differences in attitudes toward energy use, and craft targeted communications for their energy-efficiency offers.
• VALS helped a State Department of Conservation increase residential recycling of bottles and cans through its custom research study. We surveyed residents to identify recycling attitudes and behaviors. Working with the department and its advertising/PR firm, we selected a target and developed communication themes. The agency designed a series of radio and print ads. The department piloted ads in a community with high target concentrations that it identified using GeoVALS™. Recycling increased 15% in three months.
• SBI conducted a campaign-development project for a nonprofit organization that was concerned that environmentalists "preach to the choir" but don't effectively communicate with "the rest of America." It identified underlying motivations of various pro and con environmental positions as well as relevant communication themes for specific consumer segments using a custom research survey. SBI conceptualized ideas for new environmental campaigns for targeted audiences.
• A nonprofit organization associated with the U.S. National Parksintegrated the VALS questionnaire into an custom online survey of its donor base. Segmenting respondents by VALS enabled it to select the best target for future recruitment efforts. The improved target understanding informed strategic-planning decisions and led to a revision of donor materials.