NAME: STEPHEN NARTEY
SUBJECT: ADVERTISING
SESSION: LEVEL 300 (TOP-UP) WEEKEND
QUESTION: Identify the types of consumers in the consumer and business market.
A consumer is a person engaged in evaluating, acquiring and using goods and services to satisfy his needs and wants. The consumer is the key figure in any market and therefore, all activities carried in the consumer and business market are centered around him.
Consumer markets, on the other hand, are the markets for products and services that are bought by consumers for their own or family use. Goods consumers look out for in consumer markets can be categorised in the following ways:
Fast-moving consumer goods commonly known as FMCGs: These are high volume, with low unit value, fast repurchase. Examples include ready meals; baked beans; newspapers, toothpastes, soaps, shampoos, biscuits etc.
Ø Consumer durables: These are goods that have low volume but the per unit value is high. Consumer durables can be further sub - divided into:
White goods such as fridge-freezers; cookers; dishwashers; microwaves etc
Brown goods including DVD players; games consoles; personal computers etc
Soft goods which are also similar to consumer durables, the only difference is that they wear out more quickly and therefore they have a much shorter replacement cycle. Examples of soft goods include clothes, shoes, jackets, Jewelry, socks.
Services: Services are intangible products. Examples of services include hairdressing, dentists, and childcare.
In that spectrum, the consumer can be further divided in to two classes.
1: Personal Consumer
Personal consumer is that consumer who purchases goods and services for his own personal consumption or uses. We can say that consumer is also called to be the ultimate or final person because when the marketer produces the goods then he hands over the goods to personal consumer for final consumption.
For example: Auntie Efia Attah buys panties for his personal use so she is said to be personal consumer.
2: Organizational Consumer
Organizational consumer consists of the government agencies, business organization, non- governmental organization (NGO), firms and different types of manufacturing companies who purchase the goods and services in order to run the business of the firm or business concern or business organization.
For example: A non-governmental organisation in reproductive health purchases condoms from the Ghana Health Service in order to use to promote its advocacy campaign
The main purpose of the purchase is to facilitate their cause of addressing teenage pregnancy among the youth. Consumers can also be categorised into buyer types.
Demographics
This includes the income, socio-economics, age, gender, residency location, lifestyle, family status, and perception of products' value of the consumer.
Timing is another factor to consider when segmenting customers into types.
Timing of Purchase
Consumers can be grouped into the following 5 categories: Suspects, Prospects, First time buyers, Repeat buyers and Non-buyers, based upon where they are in the buying process.
Suspects are people that aren't even thinking about buying, prospects are those that are thinking about it, first time-buyers have decided they are going to buy, repeat buyers have bought before, and non-buyers are never going to buy.
Communications and support are often approached differently with these consumer types based upon the timing of their potential purchase.
Question 2: The role of advertising in consumer purchasing decision?
There is normally a six-step process that consumers go through when buying something. First they recognize a need, then they do research, they evaluate their research and look for alternatives. They then make a purchase decision, they go through the action of purchasing, and then they examine what they purchased after the fact.
Understanding the steps of the logical buying process doesn't always mean that every consumer will go through each of these every time. Factors that influence customer behavior include their need, the risk, and the type of good purchased which to a large extent, influenced by advertising.
For example, Mr. E buying a newspaper, which is a fast moving good, at a news stand. Chances are likely that Mr. E will recognize a need, make the decision to buy, buy and not give it a second thought. But that same consumer when he is going to buy let suppose Corolla X, however, will most likely cause the consumer to take their time through each step, as they wade carefully through all the details and alternatives.
In arriving at this decision by the consumer, is dependent on advertising. Too often, attention is focused on the ability of an ad to persuade us. People look out for a major effect rather than more subtle, minor effects. Big and immediate effects of advertising do occur when the advertiser has something new to say. Then it is easy for us to introspect on its effect.
But, consumers decisions are influenced largely by the minor or small effects of advertising that influences the consumer on which brand he should choose especially when all other factors are equal and when alternative brands are much the same.
It is easier to understand consumer purchasing decision from the low-involvement buying situations. The situation is like a ‘beam-balance’ in which each brand weighs the same. With one brand on each side, the scale is balanced. However, it takes only a ‘feather’ added to one side of the balance to tip it in favor of the brand on that side. The brands consumers have to choose from are often very similar. Which one will the buying balance tip towards? When we look for advertising effects we are looking for feathers rather than heavy weights. The buying of cars, appliances, vacations and other high-priced items are examples of high-involvement decision- making. This high level of involvement contrasts with the low level brought to bear on the purchase of products like shampoo or soft drink or margarine. For most of us, the buying of these smaller items is no big deal. We have better things to do with our time than agonize over which brand to choose every time we buy something.
The fact is that in many low-involvement product categories, the alternative brands are extremely similar and in some cases almost identical. Most consumers don't really care which one they buy and could substitute easily if their brand ceased to exist. It is in these low-involvement categories that the effects of advertising can be greatest and yet hardest to introspect upon.
Even with high involvement products the beam balance analogy is relevant because very different alternatives can weigh-up equal. We often have to weigh up complex things like ‘average quality at a moderate price’ against ‘premium quality at a higher price’. Often we find ourselves in a state of indecision between the alternatives. When the choice weighs equal in our mind, whether it is low involvement products or high involvement products, it can take just a feather to swing that balance.
The role advertising plays in consumer behaviours are similar to how kids grow in a day, we are just not aware of the small differences advertising can make. Even though these unnoticeably small changes in time add up to significant effects, individual increments are too small for us to notice. They are just below the just noticeable difference (JND).
Through the process of repetition these small increments can produce major perceived differences between brands, but we are rarely aware of the process taking place.
The cumulative effects of changes in brand image become starkly noticeable only in rare cases: for instance, when we return home after a long absence and find that an old brand is now seen by people in a different light — that in the intervening period the brand has acquired a different image.
Registering a claim in our minds (e.g. ‘taste the difference’ or ‘good to the last drop’) does not necessarily mean we believe it. However, it makes us aware that there are claimed differences between brands. This is a proposition (a ‘feather’, if you will) that, when everything else is equal may tip the balance of brand selection, even if only to prompt us to find out if it is true.
Repetition increases our familiarity with a claim. In the absence of evidence to the contrary, a feeling of greater likelihood that the claim is true begins to accompany the growing familiarity. This effect of repetition is known as ‘the truth effect. Even though it may be perceptibly small, a single reinforcement/reminder exposure can have substantial effects on short term sales and market share for well established brands with established ad campaigns.
