Marketing - Understanding Customer

Customer is the central point of all marketing activities. Manufacturers are producing those products which are needed by the customers. As the consumer behaviour differ from person to person the manufacturer must understand it. Knowledge of the buying motives of consumers is essential for a marketer/manufacturer, because it is buying motives that prompt the buyer to purchase. These motives may be food and drink, fear, bargain, etc. Consumer behaves in a particular manner as directed by his inner motive. It is in the interest of the marketeer that he study and analyse the buying motives.

According to D. J. Durian, "Buying motives are influences or considerations which provide the impulse to buy, induce action or determine choice in the purchase of goods and services."

Classification of Buying motives:
1. Primary Buying Motives: These motives are necessary for human life. For example, food, clothes, house, social recognition, freedom from fear and dangers, comfort ant to attract opposite sex.
2. Secondary Buying Motives: These motives are the motives learnt by human being from the society. For example, to bargain, to earn the profits, to collect information, efficiency, convenience, style, reliability and prestige.

Various stages of Buying Motives or Decision Making Process in Buying:
A decision to buy a product is taken after passing through different stages. These stages differ form product to product. A decision to buy a product of daily use is taken with in a second but a decision to buy a durable product is taken after critical study of many factors. Generally, a buyer goes through following stages when he decides to buy a product:
1. Feeling of Unsatisfied Needs: A consumer is a social being. He feels many needs but finds himself unable to fulfill all these needs due to his limited resources. Therefore, he determines a order of preference for satisfying his needs. Determination of such order of preference is the first stage of buying process. A marketer tries to convey the uses of his products to the consumers through his advertisement programmes.
2. Identification of alternatives: Determination of preference order sets the needs of a consumer in an order and the consumer starts to fulfill his needs one by one. He determined the need to be satisfied first of all. Then he tries to identifies different alternatives available to study his need. He frames an opinion with regard to the size, brand, uses, and price, etc. of these alternatives.
3. Evaluation of these alternatives: Now merits and demerits off all the alternatives are evaluated. It helps the consumer in choosing the best possible alternative. After selecting the best alternative, the consumer proceeds to buy it.
4. Post purchase feeling: Buying process does not end with the purchase of product. It includes the feelings of consumers after they have purchased the products. At this stage, attempts are made to understand the extent to which the buyers feel themselves satisfied with their purchases. Such information is very useful for the marketer.

Different environments and their influences on marketing

Marketing Environment

An organization operates basically in three types of environments macro, micro and internal environment. These environments also affect the marketing activities of an organization and they have direct and indirect effect on these activities. Some of the element of these environments are controllable and some are non controllable for the organizations. A brief description of these environments and their effect on the firms are as follow:

The Macro Environment This environment can be studied in the form of PEST Analysis.

1. Political Environment: It includes how and to what degree a government intervenes in the economy. Specifically, political factors include areas such as tax policy, labour law, law, trade, tariffs, and political stability. Furthermore, governments have great influence on the health, education, and infrastructure of a nation.
2. Economical Environment: It includes economic growth, interest rates, exchange rates and the inflation rate. These factors have major impacts on how businesses operate and make decisions. For example, interest rates affect a firm's cost of capital and therefore to what extent a business grows and expands. Exchange rates affect the costs of exporting goods and the supply and price of imported goods in an economy
3. Social Environment: It includes the cultural aspects, health consciousness, population growth rate, age distribution, career attitudes and emphasis on safety. Trends in social factors affect the demand for a company's products and how that company operates. Companies may change various marketing strategies to adapt to these social trends (such as offering innovative health insurance schemes).
4. Technological Environment: It includes technological aspects such as R&D activity, automation, technology incentives and the rate of technological change such as how to market products on internet effectively. Technological shifts can affect costs, quality, and lead to innovation.

The Micro Environment These are internal factors close to the company that have a direct impact on the organization’s strategy. These factors include:

1. Customers: Marketing organizations survive on the basis of meeting the needs, wants and providing benefits to their customers.

2. Suppliers: Increase in raw material prices will have a knock on affect on the marketing mix strategy of an organization. Prices may be forced up as a result.

3. Shareholders: Satisfying shareholder needs may result in a change in tactics of marketing organization. Many internet companies who share prices rocketed in 1999 and early 2000 have seen the share price tumble as they face pressures from shareholders to turn in a profit.

4. Media: Consumer programmes with a wider and more direct audience can also have a very powerful and positive impact. It enforces organizations to change their marketing strategies.

5. Competitors: Marketing is all about differentiation. What benefit can the organization offer which is better than their competitors. Can they sustain this differentiation over a period of time from their competitors? Competitor analysis and monitoring is essential for an organization to maintain its position within the market. 

The Internal Environment It refers to the combination of elements inside the organization on which it has full control. These are as follow:

1. Employees: Employing the correct sales force and keeping it motivated is an essential part of the strategic planning process of a marketing organization. Training and development plays an essential role particular in service sector marketing in-order to gain a competitive edge.  This is clearly apparent in the airline industry.
2. Processes: Internal processes and procedures affect the product delivery, after sales services, customer satisfaction, etc. It is a very important aspect in services marketing.
3. Culture of the organization: It refers to whether the culture is supportive to marketing objectives of the organization?

Marketing Mix

The marketing mix principles (also known as the 4 p’s.) are used by business as tools to assist them in pursuing their objectives it was given by Jerome McCarthy in 1960. The marketing mix principles are controllable variables, which have to be carefully managed and must meet the needs of the defined target group. Four P’s of marketing mix are Product, Price, Place and Promotion. Aim of marketing mix is putting the right product in the right place, at the right price, at the right time. A description of each is given below:

1.     Products: Products refers to the goods which are offered by the company to the customers. Decisions regarding products includes questions like

What should be the features of the product?

How it should look like?

How it should be branded and packaged?

What should be its quality? And the like

2.     Price: Price is the amount the customer pays for the product. Pricing decisions includes pricing policy, pricing objective and pricing strategy. It answers the question that what should be the best price of the product? taking into consideration firm’s objectives, competition, etc.

3.     Place: Place represents the location where a product can be purchased. It is often referred to as the distribution channel. It can include any physical store as well as virtual stores on the Internet.

4.     Promotion: Promotion refers to all the communication regarding the product to the customers. Different elements of promotion are Advertising, Personal Selling, publicity and sales promotion. There are various tools of promotion and company has to decide upon the best suitable way of promotion which can yield maximum returns or fulfill promotional objectives.