Lecture 002 - Understanding the Consumer.pptx

Understanding the Consumer is part of the course Advertising Strategy.

1. Understanding the Consumer Course: Introduction to Advertising Strategy Week: 2 Instructor : Sayyed Paras Ali 02-20-2025

2. Course Overview: What to Expect in This Course Understanding advertising strategy fundamentals. Exploring the advertising industry and its key players in Pakistan. Learning how to create impactful ad campaigns for local markets. Developing skills for real-world advertising challenges in Pakistan.

3. Learning Objectives: What You Will Learn Today Understand the psychology of consumer behavior Learn about audience segmentation (demographics, psychographics , behavior) Explore the consumer journey & decision-making process Apply knowledge through an in-class activity

4. What is Consumer Behavior ? Consumer behavior refers to the study of how individuals make decisions to buy, use, and dispose of products/services. It includes psychological, social, and emotional factors that influence purchasing.

5. Why Customer Behavior is important ? Helps marketers understand what motivates consumers. Improves targeted advertising and product positioning. Enhances customer satisfaction and brand loyalty.

6. Factors Influencing Consumer Behavior Understanding the Consumer

7. Factors Influencing Consumer Behavior Psychological Factors – Perception, motivation, beliefs, and attitudes. Personal Factors – Age, occupation, income, personality, lifestyle. Social Factors – Family, friends, social status, culture. Economic Factors – Purchasing power, product affordability.

8. 1. Psychological Factors Factors Influencing Consumer Behavior Definition: How a consumer thinks, perceives, and reacts to marketing messages. Includes motivation, perception, beliefs, and attitudes. Key Components : Motivation : What drives a person to buy? (e.g., Need for safety, status, convenience) Perception : How consumers interpret brand messages (e.g., A luxury brand is perceived as premium ) Beliefs & Attitudes : A consumer’s opinion about a brand (e.g., "Organic food is healthier") Example: A fitness brand markets "healthy living" to appeal to motivated consumers who want a better lifestyle.

9. 2. Personal Factors Factors Influencing Consumer Behavior Definition: Characteristics unique to each consumer that influence buying behavior. Key Components : Age & Life Stage : Young people buy gadgets, while older adults buy health products . Occupation & Income : High earners may prefer luxury brands; students may opt for budget products. Personality & Lifestyle : Some prefer adventurous brands (Nike), while others prefer formal brands (Rolex). Example : McDonald's markets Happy Meals to kids, while offering premium burgers for adults.

10. 3. Social Factors Factors Influencing Consumer Behavior Definition: How friends, family, social status, and cultural values influence buying behavior. Key Components: Family Influence : Parents influence kids' choices (e.g., toothpaste, breakfast cereals ). Social Groups : People adopt fashion & tech trends from peer groups . Culture & Traditions : Certain foods, clothing, and products are preferred based on cultural norms. Example: In Pakistan, branded lawn suits are popular because of cultural influence and social trends.

11. 4. Economic Factors Factors Influencing Consumer Behavior Definition: The consumer’s financial condition and the economy’s overall state impact purchasing decisions. Key Components: Purchasing Power: People with higher incomes buy premium brands; budget-conscious consumers prefer affordable options. Product Affordability: Even middle-class buyers may buy luxury brands if offered installments or discounts. Economic Conditions: During inflation, people cut back on non-essential items. Example: During economic downturns, people reduce luxury spending and buy essentials like groceries and medicine.

12. Consumer Behavior in Advertising Consumers react differently to rational vs. emotional appeals. Advertising strategies should align with consumer motivations. Example: Rational Appeal: “This detergent removes 99% stains.” Emotional Appeal: “This detergent keeps your family safe.”

13. Audience Segmentation Understanding the Consumer

14. Audience Segmentation Definition: Audience segmentation is the process of dividing consumers into groups based on common characteristics. Helps in targeted marketing and personalized messaging. Key Segments : Demographics – Age, gender, income, education, family size. Psychographics – Interests, values, lifestyle, personality. Behavioral – Brand loyalty, purchase habits, product usage.

15. 1. Demographic Segmentation Audience Segmentation Examples: Coca-Cola targets youth & working professionals. Shan Foods targets Pakistani homemakers & chefs. Why is it important? Helps create effective advertisements. Ensures brands communicate with the right audience.

16. Psychographic Segmentation Audience Segmentation Definition: Categorizing people based on their values, interests, and lifestyle. Example: Nike targets fitness-conscious & competitive individuals. Starbucks appeals to urban, socially active, and brand-conscious consumers.

17. Behavioral Segmentation Audience Segmentation Definition: Dividing consumers based on how they interact with a product. Examples: Brand Loyalty : Apple users prefer iPhones over other brands. Usage Rate : Heavy coffee drinkers vs. occasional coffee drinkers. Why is it useful? Helps marketers customize offers for frequent buyers.

18. The Consumer Journey Understanding the Consumer

19. The Consumer Journey What is the Consumer Journey? The process a consumer goes through before purchasing a product. Stages : Awareness : Recognizing a need or problem. Consideration : Researching and comparing options . Decision : Purchasing the product . Post-Purchase : Brand loyalty and reviews.

20. 1. Awareness Stage – Recognizing a Need The Consumer Journey The consumer realizes they have a need or problem. Brands create awareness through advertisements, word-of-mouth, or online content. Example : A customer sees an ad for Sufi Cooking Oil on TV, highlighting its health benefits. They realize they need a healthier cooking oil.

21. 2. Consideration Stage – Research & Comparison The Consumer Journey The consumer searches for solutions, compares different products, reads reviews, and asks for recommendations. Example : The customer compares Sufi Oil with Dalda and Meezan Oil. They check social media reviews, ask friends, and watch YouTube comparisons.

22. 3. Decision Stage – Making the Purchase The Consumer Journey The consumer chooses a product based on price, quality, or brand trust. The brand’s messaging, discounts, and promotions influence the decision. Example : The customer visits Al-Fatah Supermarket and finds that Sufi Oil is on discount. They choose Sufi Oil over Dalda due to price + positive reviews.

23. 4. Post-Purchase Stage – Experience & Loyalty The Consumer Journey The consumer evaluates whether the product met their expectations. A good experience leads to brand loyalty; a bad one leads to complaints. Example : The consumer likes the taste and quality of Sufi Oil. They share positive feedback on social media and recommend it to family. They become a repeat customer, always buying Sufi Oil.

24. The Consumer Decision-Making Process Understanding the Consumer

25. The Consumer Decision-Making Process Consumers go through 5 key steps before making a purchase: Problem Recognition : Need for a product (e.g., a new phone ). Information Search : Looking for brands, features, and prices. Evaluation of Alternatives : Comparing different brands. Purchase Decision : Choosing and buying the product. Post-Purchase Behavior : Satisfaction, feedback, or complaints.

26. Step 1 – Problem Recognition The Consumer Decision-Making Process Definition: The consumer realizes a need or problem that requires a solution. This stage is triggered by personal needs, external influences, or marketing messages. Example: A student notices their old mobile phone is slow and battery drains quickly. A customer sees an ad for milk with added calcium and realizes they need healthier options. Brand Role: Brands create awareness through ads, social media, and influencer marketing.

27. Step 2 – Information Search The Consumer Decision-Making Process Definition: The consumer gathers information about available products/services. This could be through Google searches, social media, TV ads, word-of-mouth, or product reviews. Example : The student watches YouTube reviews comparing Samsung, Vivo, and iPhone models. A family asks friends about the best dairy milk brand (e.g., Olper’s vs. Nestlé). Brand Role: Companies ensure strong online presence, customer testimonials, and expert endorsements.

28. Step 3 – Evaluation of Alternatives The Consumer Decision-Making Process Definition: Consumers compare different options based on features, prices, brand reputation, and recommendations. They filter choices and prepare for a final decision. Example: The student compares Jazz and Telenor internet packages before choosing one. A customer evaluates Shan Masala vs. National Masala based on spice quality & price. Brand Role: Offer side-by-side comparisons, influencer marketing, and persuasive messaging to influence decisions .

29. Step 4 – Purchase Decision The Consumer Decision-Making Process Definition: The consumer finally selects a brand and makes the purchase. Factors like discounts, promotions, product availability, and peer pressure may influence the decision. Example: The student chooses a Samsung phone because it is affordable & has a good camera. A mother buys Shan Masala because it has better flavor & a buy-one-get-one-free deal. Brand Role: Brands must offer promotions, easy payment methods, and strong in-store availability to close sales.

30. Step 5 – Post-Purchase Behavior The Consumer Decision-Making Process Definition: After using the product, the consumer evaluates satisfaction and decides whether they will repurchase or switch brands. Example : The student loves the Samsung phone and leaves a positive review online. The customer is disappointed with milk quality and switches from Nestlé to Olper’s . Brand Role: Provide after-sales service, customer support, and loyalty programs to retain customers.

31. Example – A Consumer Buying a Smartphone The Consumer Decision-Making Process Scenario: A customer wants to buy a new phone. Problem Recognition: Old phone is slow. Information Search: Reads online reviews, watches YouTube comparisons. Evaluation of Alternatives: Compares Samsung, Apple, and OnePlus . Purchase Decision: Buys an iPhone based on features. Post-Purchase Behavior: Leaves a review online.

32. Class Activity – Develop an Audience Persona Understanding the Consumer

33. Class Activity – Develop an Audience Persona Objective: Work in small groups and create an audience persona for a product. Instructions: Choose a product (e.g., fast food, skincare, electronics). Define its target audience (age, gender, income, lifestyle). Identify their motivations, needs, and habits . Example Persona for a Clothing Brand: Name : Sarah Ahmed Age : 25 Occupation : University student Interests : Fashion, social media, online shopping Buying Behavior : Prefers affordable, trendy clothing

34. Assignment # 2 Deadline: 02-24-2025

35. Assignment 2 – Target Audience Analysis Task: Choose a brand (local or international). Analyze its target audience using segmentation techniques. Submit a one-page report covering : Brand Name Target Audience (Demographics, Psychographics, Behavior ) Consumer Journey (Awareness to Post-Purchase ) Key Takeaways Deadline : 02-24-2025

36. Quiz # 2 02-19-2025

37. Question 1 What is consumer behavior? A) Study of consumer decisions B) Study of only product features C) Study of advertisement effectiveness D) Study of business profits

38. Question 2 Which of the following is NOT a factor influencing consumer behavior? A) Psychological B) Economic C) Office Location D) Personal

39. Question 3 What does 'psychographics' in audience segmentation refer to? A) Age and gender B) Interests, values, and lifestyle C) Brand loyalty D) Household income

40. Question 4 Which factor influences a consumer's perception of a brand? A) Social class B) Product color C) Advertising and past experiences D) Company name only

41. Question 5 At which stage of the consumer journey does a buyer recognize a need? A) Consideration B) Decision C) Awareness D) Post-Purchase

42. Question 6 Which segmentation method divides consumers based on buying habits? A) Geographic B) Behavioral C) Psychographic D) Demographic

43. Question 7 Why is post-purchase behavior important for brands? A) It increases production costs B) It determines customer satisfaction and loyalty C) It affects only luxury brands D) It has no impact on marketing

44. Question 8 What does 'brand recall' refer to? A) A company's recall of defective products B) A customer's ability to remember a brand C) The legal registration of a brand D) The physical packaging of a brand

45. Question 9 Which brand in Pakistan successfully used emotional appeal in its marketing? A) Jazz B) Shan Foods C) Samsung D) Pepsi

46. Question 10 How does economic condition influence consumer behavior? A) Determines product affordability B) Only affects luxury goods C) Has no impact on daily purchases D) Only influences large companies

47. Question 11 Which media channel is best for targeting young Pakistani consumers? A) Radio B) Newspaper C) TikTok and Instagram D) Billboards

48. Question 12 What is the main goal of audience segmentation? A) To reduce marketing costs B) To target the right consumers effectively C) To increase brand loyalty D) To analyze consumer complaints

49. Question 13 Which of the following is an example of rational appeal? A) A detergent ad showing a mother and child bonding B) A toothpaste ad showing 99% germ protection C) A chocolate ad using nostalgia D) A perfume ad with a celebrity

50. Question 14 In which stage of the consumer journey does a buyer compare products? A) Awareness B) Consideration C) Decision D) Post-Purchase

51. Question 15 Which of the following is a common mistake in advertising? A) Strong emotional appeal B) Cultural irrelevance C) Using a brand ambassador D) Targeting the right audience

52. Question 16 What is A/B testing in advertising? A) Running an ad campaign in two countries B) Comparing two versions of an ad for performance C) Launching a product before an ad D) Testing an ad with only employees

53. Question 17 Which Pakistani telecom brand used 'Jazz It Up' as its campaign? A) Telenor B) Jazz C) Zong D) Ufone

54. Question 18 Why do brands use influencer marketing? A) To reduce product cost B) To reach target audiences through trusted figures C) To replace traditional advertising D) To eliminate competition

55. Question 19 What is the role of budgeting in advertising? A) Allocating resources and measuring campaign success B) Increasing marketing expenses only C) Removing financial risks D) Preventing brand recall

56. Question 20 Which of the following represents the correct consumer journey order? A) Awareness > Decision > Consideration > Post-Purchase B) Consideration > Awareness > Decision > Post-Purchase C) Awareness > Consideration > Decision > Post-Purchase D) Decision > Awareness > Consideration > Post-Purchase

57. Correct Answers Q1: A) Study of consumer decisions Q2: C) Office Location Q3: B) Interests, values, and lifestyle Q4: C) Advertising and past experiences Q5: C) Awareness Q6: B) Behavioral Q7: B) It determines customer satisfaction and loyalty Q8: B) A customer's ability to remember a brand Q9: B) Shan Foods Q10: A) Determines product affordability Q11: C) TikTok and Instagram Q12: B) To target the right consumers effectively Q13: B) A toothpaste ad showing 99% germ protection Q14: B) Consideration Q15: B) Cultural irrelevance Q16: B) Comparing two versions of an ad for performance Q17: B) Jazz Q18: B) To reach target audiences through trusted figures Q19: A) Allocating resources and measuring campaign success Q20: C) Awareness > Consideration > Decision > Post-Purchase

58. Recap & Key Takeaways Consumers make decisions based on psychology, needs, and habits. Audience segmentation helps in targeted marketing. Understanding the consumer journey improves advertising strategies. Practical application through activities and assignments.

59. Next Class Preview Market Research in Advertising How market research helps brands. Different research techniques & tools. Case studies from Pakistan.

60. Next Class Preview Market Research in Advertising How market research helps brands. Different research techniques & tools. Case studies from Pakistan.

61. Thank you Sayyed Paras Ali Editorial Board Member, COMSTECH Journal of Science Communication and Diplomacy Permanent Member, Science Communication Advisory Committee, COMSTECH - OIC Email: [email protected] WhatsApp : [phone]