978-0136074892 Solution Manual Chapter 04 Part 2

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Teaching Tips and Strategies from Barbara S. Faries, MBA

This chapter provides understanding of consumer behavior: who buys, why they

buy, how they make purchase decisions, where they purchase, and when they buy.

Key Terms and Concepts Introduced Include:

·Market segmentation

·One-to-one marketing

·Mass customization

·Segmentation variables

·Descriptors

·Geographic

·Demographic

·Cohort analysis

·Psychographic

·Hierarchy of needs

·Physiological

·Safety

·Social

·Ego

·Self-actualization

·Evoked or consideration set

·Purchase set

·Inert set

·Multivariate model

·Compensatory model

·Expectations

·Family life cycle

·Relative advantage

·Compatibility

·Complexity

·Trialability

·Observability

·Network externalitities

Note: Two recurring themes in this Instructor’s Manual will be the first two items:

·Link theory to practice.

·Engage students to link work experience to the concepts demonstrated in

the text.

·Instructors are encouraged to link theory to practice by finding current examples

in the consumer environment that demonstrate the key concepts above.

·If your class contains those already working in the field, have them describe how

the concepts in theory match those in the actual workplace.

One of the most important concepts in this chapter is segmentation. I often find

using current popular consumer items is a way to demonstrate this. I use companies such as

Nike, Adidas, or Apple products. Have the students discuss these companies and the way

they segment their markets and products to reach different consumer groups. I often use

this an in-class exercise by outlining various segments and products then applying common

segmentation variables to demonstrate the point.

The other important point students need to understand is the timing issue of product

sales and the effect these timing or purchase cycles have on the organization from

marketing communications to distribution channels to manufacturing and inventories. Once

again, using a common season such as Christmas to demonstrate purchase timing and the

effect on the manufacturer’s plans can be quite useful.

Review Questions

1. Think of a product or service that is mass marketed and one that focuses on one or

more particular segments. How does the development of marketing strategy differ in

the two cases?

2. For a product of your own choosing, pick one logical variable (e.g. age) that can be

used to segment the market. Now, add a second variable (e.g., gender), so that

customers have to satisfy the categories of both variables simultaneously (e.g., 18-

to24-year-old women). Now add a third variable. How many possible segments can you

identify from a combination of the three variables? What implication does this have for

the marketing manager?

3. Visit the VALS2Web site and find out in which psychographic group you fall. Apply the

questions to a copy of acquaintances in different age groups (mother, uncle, younger

sister, etc.) and classify them as well. Would you have guessed that they would be in

those groups?

4. Write a list of physical characteristics for a product. Take each characteristic and

indicate what benefits it provides to customers. How would an advertisement reflect

this information?

5. What are the challenges in marketing products that are highly seasonal? Pick some

examples to illustrate.

6. Pick a high tech product that was successful (e.g., VCR) and one that was not (e.g., the

videodisc player, Apple Newton). Using Everett Roger’s five factors facilitating the

adoption of new technological products (relative advantage, etc.), explain the

difference in the product’s success.

Exercises, Activities, and Projects

Purpose: To help students link theory to real life.

To convey to students how market segmentation is used in the business world.

Have students break into groups and turn to pages 105 – 107 Tables 4.7 and 4.8

These tables depicts the different characteristics of Harley-Davidson Motorcycle

riders. Have students compare and contrast the differences between the different

buyers of motorcycles. Have them share their findings with the class. This exercise

helps students to understand that products are created with a specific profile in

mind. You might even want to give students a customer profile and have them

explain to you what type of bike that person would probably buy and why.

Another variation would be to use the example of Harley-Davidson then ask the

students to compare and contrast other makers and manufacturer’s of motorcycles

segmentation strategies. Compare and contrast Kawasaki’s and Honda’s strategies

to Harley-Davidson: Are they same? Different?