Marketing Communication - The Consumer Behaviour of Individuals Belonging To the Age Group of 30-50 - Case Study Example

Marketing Communication - The Consumer Behaviour of Individuals Belonging To the Age Group of 30-50 in the United Kingdom Table of Contents Customer Profile 3 Demographic Analysis 4 Promotional Strategy 6 Advertising 8 Public Relations 8 Sponsorships 10 Sales Promotions 10 Direct Marketing 10 Internet 11 Conclusion 12 Reflective Essay 12 References 14 Introduction Twenty first century has been often been dubbed as the age of competition. This century is categorized by the advent of globalization which has resulted in companies breaching geographical boundaries to grab a share of the market. In the context of growing competition, it has become extremely imperative for organizations to have an effective brand image. The market is also characterised by the presence of numerous kinds of customers with varying needs and wants. In order to gain a considerable market share, companies must provide tailor made products and services which are specific to the needs of the target customers. Porter stated three basic strategies that could be adopted by firms. These are cost leadership, focus and differentiation strategies. Figure 1: Framework of Porter’s Generic strategy (Source: California State University, n.d.) Customers can be categorised into different categories based on their age, social status, purchasing power etc. Categorisation of customers assumes importance as different customers have specific needs which must be fulfilled by firms. The present study analyses the consumer behaviour of individuals belonging to the age group of 30-50 in United Kingdom and prepare an effective marketing communication program that would be used to reach out to this particular customer category. Customer Profile Segmentation is a tool that is often used by marketers to segregate customers on the basis of certain factors. Segmentation is defined as “a process that uses data to understand a customer’s needs and how they decide to purchase one product over another”. This technique tends to segregate customer on the basis of similarities in their buying behaviour (Fahnestock, 2008, p.3). Application of segmentation offers certain unique advantages to an organization. Firstly it helps in providing tailor made products to each customer category having different tastes. Secondly, it helps in better allocation of resources along different product lines. Finally it also helps in countering the threats of competition posed by the advent of numerous competitors in the market (Bannon, 2004, p.4). Segmentation can be done on the basis of many factors. Customer can be segregated on the basis of geography, demographics, behavioural traits and psychographics (Sun, 2009, p.65-66). Customer profiling includes analysing the demographic, psychographic and buying behaviour of the customers (Fast Track Growth Venture, 2006, p.1). Demographic Analysis UK has about 13141300 individuals belonging to the age group of 30-44 years. Of this, approximately 6521700 are males and the rest are females (Office for National Statistics, 2009, p.11). Statistics reveal that an average household in United Kingdom spends close to 471 Pounds a week. It was also stated that individuals in the age group of 30-49 were higher spenders and spend approximately 582 Pounds a week which is much higher as compared to the average spending of the total population of the nation. The lowest spending was exhibited by individuals in the age group of 75 and above, with a weekly average spending of approximately 217 Pounds (Office for National Statistics-a, 2010). The figures imply tremendous opportunities for marketers, targeting the customers in the age group of 30-50. This segment has the highest purchasing power and hence can’t be ignored by any marketer. Individuals of this segment constitute the largest spenders in the UK market. Majumdar (2010) conducted a study on the effects that age has on the consumer buying behaviour patterns. He stated that young and middle aged customers exhibited different types of buying behaviour. It was found that young customers had a tendency to spend on products that were non essential in nature. This was in sharp contrast to the older population which spends most of its resources in purchasing essential goods. The author also stated that customer profiling needs to address both age as well as cohort effect (Majumdar, 2010 p.128). Profiling customers on the basis of age offers many distinct advantages to a marketer. It helps a marketer to take into account aspects like subcultures. It has been stated in various researches that subculture plays a vital part in the consumer buying behaviour of individuals. It also becomes easier for marketers to analyse the consumer behaviour who fall under a common age group as they display similar kinds of buying behaviour (Majumdar, 2010, p.128). Figure 2: Family Life Cycle Stages (Source: Majumdar, 2010, p.130) It has been observed that individuals generally spend more after they have started a married life. This category is classified by individuals belonging to the age group of 30-50. The tendency to purchase starts declining significantly after this age (Majumdar, 2010, p.130). Individuals in this age group also exhibit maturity in their buying behaviour. They are generally brand loyal and do not have the tendency to switch between brands at the drop of a hat. Customers in this age group also have significantly high purchasing power as they have a well settled career life. The income level of this customer class is considerably higher than the customers of lower age groups. Moreover the propensity to purchase goods and services is considerably high for this age group as compared to customers who are above 50 years of age. This makes this customer segment highly profitable as it offers tremendous potential to marketers. Individuals belonging to this age group constitute the decision making authority in a family which again highlights the importance of this category of customers. The demographic analysis reveals the importance of customers belonging to the age group of 30-50. It is also clear that any marketer trying to eye a substantial chunk of market share would try to influence this age group. The following section would provide an insight into the various marketing communication strategies that are used to lure this category of customers. Promotional Strategy Promotions are the most important tool available to marketers needed to convey their message to the target audience. Promotions serve as the vital link between an organization and its customers. It is through various promotional channels that organizations convey their intended messages to their targeted customer segments. The importance of promotions could also be analysed from the fact that any distortion in the communicated message would lead to confused positioning of the firm’s products and services in the minds of the consumer. A confused positioning can have disastrous consequences on the organization as it may directly hamper their revenue margins. Marketing Communication mix is defined as “the specific mix of advertising, personal selling, sales promotion and public relations that are being used by a firm to achieve its marketing and advertising objectives” (Assumption University of Thailand, 2010, p.2). The concept of integrated marketing communications has been developed in order to integrate the various tools of marketing communication. This helps in reducing cases of distortion in the message to be communicated to the target audience. The process of marketing communication generally encompasses the following aspects namely, 1. Sender 2. Message to be communicated 3. Media for communication 4. Receiver of the message 5. Encoding the message to be communicated 6. Decoding the communicated message 7. Response to the message 8. Feedback from the receiver (Assumption University of Thailand, 2010, p.8). Marketing communication process begins with the identification of the target market audience. The next step involves framing the objectives of marketing communication. In the next stage, the intended message to be communicated in properly designed. This is followed by selection of the media by which the message would be communicated to the target customers. Collective feedbacks are subsequently gathered and analysed using different tools. This helps in identifying the possible errors. Remedial actions could henceforth be prepared so as to make the marketing communication process achieve its objectives (Assumption University of Thailand, 2010, p.9-14). Different channels that are used by marketers to communicate their message to their target audience are stated below: 1. Advertising 2. Public Relations 3. Sponsorships 4. Sales promotions 5. Direct marketing 6. Internet Advertising Advertising is one of the oldest tools that have been used by marketers to promote their message to the customers. Advertising can be in the form of ads on TV, radio as well as through print media like newspapers and magazines. Organizations prepare short and catchy messages which contain information about product or service offering of the company. Companies often engage celebrities to endorse their brands in an attempt to lure customers to view their advertisements. This form of communication has significant effects on the minds of customers especially those within the age group of 30-50. This is because, most of them spend considerable time in reading newspapers, magazines etc. Firms, on their part, must ensure that the message is properly decoded by the targeted customer so that there is no instance of confused positioning. Attempts must be made to air advertisements on those channels which are frequently viewed by this category of customers. Public Relations ‘Public Relations’ is another tool that is being used by firms to promote their products and services to the targeted customer segments. Michelson & Stacks (2007) conducted a comparative analysis of advertising and public relations on their ability to influence the target market audience. They stated that public relations as a tool for marketing communication scores over traditional forms of advertising. The authors attributed this advantage to the effect of a ‘multiplier’. It was stated that the multiplier effect of public relation based marketing communication programme scored approximately 2.5 to 8 times more than the traditional form of advertisement. Public relations in the form of endorsement by a third party have greater effect on the target audience as compared to plain advertising. These factors assumes significance in the context of customers belonging to the age group of 30-50, as they are known to be highly matured and would therefore require concrete elements to support the claims of companies as stated in the marketing communication programme. The authors also quoted an example in which they stated that the editorial coverage of a product or service is bound to have greater influence on the target audience as it would involve a third party to analyse the claims made by companies in the marketing communication programme (Micaelson & Stacks, 2007, p.1-2). The effect of multiplier in a public relationship based marketing communication program is affected by five factors namely “situation, frequency, exposure, messaging strategy and finally the nature of the communication process” (Micaelson & Stacks, 2007, p.3). Situation implies the form of public relations being employed by a marketer; exposure implies the extent of promotional mix that is used in the marketing communication process. Messaging refers to the nature of the targeted market audience; it also reflects the nature of the message. Nature of communication denotes the extent of control of the marketer (Micaelson & Stacks, 2007, p.3). Sponsorships Sponsorships include funding programs of organizations in which firms pay for organizing a particular event like sports, cultural events etc. Sponsorships have long been used by organizations as a promotional tool for propagating information about their products and services to the customers. The target customer segment of 30-50 years can be lured by organizations if they sponsor different events like sports. Sporting events are mostly viewed by this category of individuals. Care must be taken by organizations to include and sponsor events which generate interest among these individuals. Soccer events like World Cup, English premier leagues are examples of events which generate considerable interest among the individuals belonging to the age group of 30-50 years. Sales Promotions The major advantage of sales promotion lies in the fact that they provide direct monetary advantage to the customers. Sales promotions help in inducing trails and to serve as a tool to induce price discrimination. Sales promotions also induce greater hedonic benefits to consumers. Sales promotions also serve to induce innovations among individuals (Chandon, Wansink & Laurent, 2000, p.35). Sales promotions serve as an effective communication media for targeting individuals aged 30-50 years as this age group is characterised by individuals who are generally price conscious. Hence offering price discounts as a part of sales promotions would help in luring customers aged 30-50 years. Being the decision maker in most of the families, these individuals provide great opportunities for any organization. Direct Marketing This is a form of marketing communication technique that is used by organizations to directly reach out to the customers using a sales force. The use of this technique offers certain distinct advantages to organizations, as distortion of communication does not take place in this mode. Moreover, customer queries can be solved on the spot as the consumer is in direct contact with the organization through its representatives. The use of this mode of communication generates instant feedbacks which help in garnering the views of customers about a particular product or service offering. These feedbacks could be used by organizations to improve its products and services as well as bring into light any potential error which might have crept in the product or service offering of the company. Immediate corrective steps could be taken so that the problem gets sorted. This would generate a sense of importance for the customer who would feel valued. This would enhance the image of the organizations in the minds of the customers. Internet Internet has evolved as an important medium for marketing communication among business houses. Huge scope and wide reach of this medium has made it a popular mode of communicating ideas about a firm’s products and services to its targeted customers. The advent of popular social networking sites like Facebook and Orkut have enhanced the reach and popularity of this medium as a tool for marketing communication. Internet as a medium also offers considerable advantage to an organization with regards to targeting customer aged 30-50 years, as individuals belonging to this age group access internet for long hours. Internet as a communication media also offers considerable risks since it is an open source which may be also used to spread misinformation about the products and services of an organization. Conclusion The study conducted above shows the potential of consumers who fall in the age group of 30-50 years. The importance of this customer segment lies in the fact that they are highly matured and have considerable disposable income which makes them one of the most profitable customer segments. The age structure of this customer segment makes them the decision makers in most of the cases which again shows their importance in influencing the buying behaviour. Organizations can try out numerous techniques of communication to target and tap this market segment. Marketers must also exercise caution while targeting this segment as they are most likely to evaluate a firm’s statement about a product or service. Care must be taken to include concrete information in the marketing communication program so that there is no instance of misinformation. This consumer segment is known to be highly brand loyal hence tapping this customer segment would reap huge competitive advantage for an organization. Providing false information or information distortion can have disastrous consequences on any organization as these customers carry the image of the firm. The problem gets compounded as they form the decision making units of a family. Hence, in conclusion it can be very well stated that consumers in the age group of 30-50 years offer significant potential to organizations, provided they are communicated and tapped in a proper and effective way. Reflective Essay The study concentrates on the aspect of integrated marketing communications and its effects on the profitability of the firm or an organization. The study helped in analysing a framework of marketing communication that would be used to target customers on the basis of their age. The study has been done on a customer segment that is considered to be highly profitable as most of the individuals are earning members of the family and have a significant say in the purchase decision of a family. The study helped in analysing the importance of integrated marketing communication towards the positioning of the firm. The study also helped in analysing the relationship between the product-mix and marketing communication strategies. After concluding the project valuable insight was gained on the different channels of integrated marketing communications. There are different channels for marketing communications which have different scope and reach. The study also helped in analysing the aspect of selection of channels of marketing communications. The study also helped in analysing how to attract a specific target customer group. The study also included important aspects like customer profiling which helped in analysing the framework of an integrated marketing communication strategy for an organization. The study also had a section that dealt with how the different channels of marketing communication could be used to tap the customers in the age group of 30-50 years. Finally the study not only gave a sound understanding of the aspect of integrated marketing communication but also gave a very practical means of framing an integrated marketing communication strategy based on age based demographics. 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