Exam 6: Customers, Segmentation, and Target Marketing

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Need Recognition
The buying process begins when consumers recognize that they have an unmet need. This occurs when consumers realize that there is a discrepancy between their existing situation and their desired situation. Consumers can recognize needs in a variety of settings and situations. Some needs have their basis in internal stimuli such as hunger, thirst, and fatigue. Other needs have their basis in external stimuli such as advertising, window shopping, interacting with salespeople, or talking with friends and family.
Information Search
When done correctly, marketing stimuli can prompt consumers to become interested in a product, leading to a desire to seek out additional information. This desire can be passive or active. In a passive information search, the consumer becomes more attentive and receptive to information, such as noticing and paying attention to automobile advertisements if the customer has a want for a specific car brand. A consumer engages in active information search when he or she purposely seeks additional information, such as surfing the Internet, asking friends, or visiting dealer showrooms. The amount of time, effort, and expense dedicated to the search for information depends on a number of issues. The most important is the degree of risk involved in the purchase.
Evaluation of Alternatives
In evaluating the alternative product or brand choices among the members of the evoked set, the consumer essentially translates his or her need into a want for a specific product or brand. Consumers evaluate products as bundles of attributes that have varying abilities to satisfy their needs. The most important consideration for marketers during the evaluation stage is that the marketer's products must be in the evoked set of potential alternatives. For this reason, marketers must constantly remind consumers of their company and its product offerings.
Purchase Decision
After the consumer has evaluated each alternative in the evoked set, he or she forms an intention to purchase a particular product or brand. However, a purchase intention and the actual act of buying are distinct concepts. The customer may postpone the purchase due to unforeseen circumstances. Marketers can often reduce or eliminate these problems by reducing the risk of purchase through warranties or guarantees, making the purchase stage as easy as possible, or by finding creative solutions to unexpected problems. The key issues for marketers during the purchase stage are product availability and possession utility.
Postpurchase Evaluation
In the context of attracting and retaining buyers, postpurchase evaluation is the connection between the buying process and the development of long-term customer relationships. In the postpurchase stage, buyers will experience one of these four outcomes:
$\ddot{\mathrm{Y}}$ Delight - The product's performance greatly exceeds the buyer's expectations.
$\ddot{\mathrm{Y}}$ Satisfaction - The product's performance matches the buyer's expectations.
$\ddot{\mathrm{Y}}$ Dissatisfaction - The product's performance falls short of the buyer's expectations.
$\ddot{\mathrm{Y}}$ Cognitive Dissonance (Postpurchase Doubt) - The buyer is unsure of the product's
performance relative to his or her expectations.
Consumers are more likely to experience dissatisfaction or cognitive dissonance when the dollar value of the purchase increases, the opportunity costs of rejected alternatives are high, or the purchase decision is emotionally involving. Firms can manage these responses by offering liberal return policies, providing extensive postpurchase support, or reinforcing the wisdom of the consumer's purchase decision.