Implications of Marketing Models
Word-of-mouth can be a powerful pressure on buying behavior, and marketing strategies are designed to influence word-of-mouth. The increasing status, power and use of social media helps marketers to take more benefit to reference groups in helping them to spread messages about their products and services.
In general, consumers search to increase satisfaction and evade pain. They wish to reduce the risk of decisions they make and will spend more time in researching the purchase decisions that signify a higher level of risk.
For example, low-cost and low-involvement products like shampoo will require less efforts and worry on the part of consumers than high-cost and high-involvement products like cars, computers or homes.
Consumer involvement influence how consumers collect, understand and convey information, make buying decisions and make post-purchase evaluation. As the level of consumer participation increases, the consumer has better motivation together, comprehend, elaborate, justify and understand the information. Thus, a marketer needs to understand the process in a proper manner and design his marketing mix in a manner that can trigger the involvement process in his favor.
Example of ABC Fancy Dream Stores
Three facts were discovered by a survey done on a Fancy store which was particularly disturbing which are as follow −
People found ABC Fancy Stores to be less friendly and helpful, as customers were generally not allowed to search by themselves. Children got bored and hence parents often left the store within few minutes after finishing their necessary shopping. They never browsed, searched or spent spare time at Fancy Dreams stores, which could actually help in promoting more sales.
With lots of choices available in the market, consumers stopped up treating Fancy Dreams stores as unique and exclusive anymore.
New Strategies for New Times
The dynamic economic conditions are affecting consumer behavior, their perceptions and attitudes. Consumers are changing their behavior in several different ways, situations and various primary attitudes and values which express these changes. It is vital for us to re-look at the consumer and bring back our understanding to well alter the marketing strategies.
Not all the consumers react to the environmental changes in the same way. Different consumers have different reactions to the economic challenges. Reduction may be reflected in different tangible and psychological ways or modes.
Manufacturers also need to offer a variety of different solutions and propositions to meet these changes in their behavior. Therefore, different consumer segments may be affected at different levels and growth may vary from segment to segment.
Find New Pastures
Growth may be easier to come through geographical expansion, than competitive battle in the current markets. The impact of the slowdown is more definite in larger cities, though the smaller towns and villages are also affected if they rely on export-based industries.
Hence, if growth may be challenged in the larger cities, it may be a good time to set forward and explore new markets in towns, townships and villages. They are the markets, which are growing at a faster pace and offer greater return for investments.
Re-Look at your Brand Portfolio
The challenge is to offer value without compromising the image in the market.
There are different strategies to deliver value – some are appropriate and some misguided, some will damage the brand image permanently and some will keep the image undamaged but still help to adjust.
Research shows that direct price reductions are likely to damage more than temporary discounts and decreasing pack sizes are more harmful than increasing pack size at the same price.
Look at your Distribution Channels
A stressed economic situation not only changes the consumer, but also changes the sellers. Consumers are normally more close to the brand than the retail store, hence their first option is not to change the brand, but try to find the brand at a cheaper price at another store.
With more time at hand and greater incentive to economize, more consumers are likely to shop at overexcited markets than the pricier supermarkets and ease stores. The search for value and bargains will also turn the shoppers to online shopping – the only channel that will grow even faster than overexcited markets.
Helping the Consumer
When opportunities are less and the competition is more vicious, the Chinese consumers will want to enhance their skills and knowledge. Visibly it is very good news for companies teaching English or computer programming or knowledge. However, the opportunity is not restricted to these firms – the FMCG industry could also take more educative communication position - wine makers could try to educate the consumers about appreciating fine wines, cosmetic companies could offer training on skin care and food companies could instruct on diet and nutrition.
Family, Home, and Security
Recession is the supreme time to catch up with friends; relatives take their children to the park and visit parents, and in the process enjoy emotional warmness to compensate for the coldness of the fiscal climate.
The children are likely to pay a deep price for this, with parents having more time and fondness as well as renewed determination to help their children with their studies. This offers opportunities to promote in-house consumption, than out of house consumption, which in many categories such as alcohol, is more expensive.
It is not just the product but also the message, which needs to reflect the current consumer mind. The communication messages of nowadays needs to reflect sentiments of care and protection, rational and careful behavior, performance and value these tones of communication, which always appealed to the Chinese consumers, are likely to find even greater meaning in these times.
For the largest internet population in the world, internet has been a tool of entertainment and information – less a tool for commerce. However, the original barriers are being overcome and consumers are discovering the joy of internet shopping.
The attributes of consumer connect with internet shopping are variety, enables detailed evaluation and comparisons and getting the product at competitive prices. These are the attributes the buyer will be looking in the period of fiscal slowdown.
Keep a Permanent Hand on the Pulse of the Consumer
Things are changing at an exceptional pace. As a result, so is the consumer atmosphere and sentiment, which will have an effect on their decision-making and the brands and products that they buy. If marketers do not feel their pulse all the time, they could go wrong. One cannot just listen to the consumer once a year - marketers need to put their ears firmly on the ground and listen to every change of beat, every tone of the consumer ]mood and continue to find tune of the strategy.