Understanding Marketing Environment and Consumer Behavior

Understanding the Marketing Environment

Actors and Forces Shaping Marketing Success

A company's marketing environment encompasses the actors and forces beyond marketing that influence marketing management's capacity to cultivate and sustain successful relationships with target consumers. Companies must vigilantly monitor and adapt to the ever-changing environment. The marketing environment comprises two key components:

• Microenvironment: This includes actors close to the company that impact its ability to engage and serve customers effectively.
• Macroenvironment: This consists of broader societal forces that shape the microenvironment, including demographic, economic, natural, technological, political, and cultural factors.

The marketing environment is the combination of external and internal factors and forces that affect a company's ability to establish relationships and serve its customers. It consists of both an internal and an external environment.

Generational Cohorts

• Baby Boomers: Born between 1946 and 1964
• Generation X: Born between 1965 and 1980
• Millennials or Generation Y: Born between 1980 and 2000
• Generation Z: Born after 2000

Consumer Behavior Insights

Key Influences on Consumer Purchases

Consumer purchases are significantly influenced by a variety of factors:

1. Cultural: Culture, subculture, and social class.
2. Social: Groups, social networks, family, roles, and status.
3. Personal: Age and life-cycle stage, occupation, economic situation, lifestyle, personality, and self-concept.
4. Psychological: Motivation, perception, learning, beliefs, and attitudes.

The Buyer Decision Process

The buyer decision process consists of five stages:

1. Need Recognition: The consumer recognizes a problem or need, which can be triggered by internal stimuli (e.g., hunger) or external stimuli (e.g., an advertisement).
2. Information Search: The consumer seeks information about potential solutions. For example, they might pay more attention to car ads, notice cars owned by friends, engage in car-related conversations, search the web, talk with friends, or gather information in other ways.
3. Evaluation of Alternatives: The consumer evaluates different brands within their choice set. Evaluation methods vary; some consumers use careful calculations, while others buy on impulse.
4. Purchase Decision: After ranking brands, the consumer forms purchase intentions. Typically, the consumer decides to buy the most preferred brand.
5. Post-purchase Behavior: After purchasing the product, the consumer will experience either satisfaction or dissatisfaction and will engage in post-purchase behavior, which is of great interest to marketers.

Adoption of New Products

A new product is a good, service, or idea perceived as new by some potential customers. Marketers are keen to understand how consumers learn about products for the first time and decide whether to adopt them.

The adoption process is the mental journey an individual takes from first hearing about an innovation to finally adopting it.