Consumer Behavior in Kelloggs & Table of Plenty - Case Study Example

Consumer Behavior Abstract Organizations spend millions of dollars each year to search for information about consumer behavior. The study was conducted on two Australian-based Kellogg’s and Table of Plenty cereals companies to examine the consumer behavior. The study examined various internal factors which influence consumer behavior. For example, consumer motivating factors such as incentives, fear, growth and achievement were examined. Other factors examined include learning and attitude. The findings established that consumer knowledge about the products influences their attitude and their buying habits. Through learning consumers consumer, can develop a different perception about a product or brand name of the company. Organizations use the information about customer perceptions and expectations to design products that meet consumer expectations. Introduction People always make decisions about what to wear or eat and so on. Similarly many product decisions are arrived at routinely, and these help provide value and customer satisfaction as well as effectively enhance the value of the company (Smith & Mackie, 2007). Additionally, it improves products and services, and creates a competitive advantage. This is known as consumer behavior. Companies can spend millions of dollars just to uncover the reasons behind the decisions that characterize the consumer behavior (Perner, 2010). This assignment examines the broader inner characteristics of the consumers in the Australian market with specific examples of Kellogg’s & Table of Plenty, based upon some of their breakfast cereals. The focus is to compare and contrast their consumers in terms of their inner characteristics, namely motivation, personality, perception, learning and attitude. Solomon (2009, p. 113) defines consumer behavior as "the study of consumers and the processes they use to choose, consume (use), and dispose of products and services and how those processes impact on the consumer and the society at large." Companies and firms’ marketing decisions are primarily based on assumption and knowledge of consumer behavior. In other words, the psychology of how consumers make decisions and what influences those decisions help companies and firms to improve their marketing strategies (Smith & Mackie, 2007). Therefore, since consumers are different they tend to display different internal characteristics relating to their needs, motivations, personality, perception, and learning regarding the same products or services (Perner, 2010). These internal factors play a major role in affecting a consumers’ behavior and so one would prefer ‘Nicely Nutty Muesli from Table of Plenty’ (Table of Plenty), rather than Crunchy Nut from Kellogg’s (Kellogg’s Websites). As such these internal characteristics play a contributing factor in the difference between tastes and preference. Motivation Smith and Mackie (2007) define motivation as a creation representing an unobservable internal force that stimulates and may compel a specific behavioral response and provide a precise direction of the response. In other words, motives are but "internal energizing force which directs a person’s behavior toward satisfying needs or achieving goals" (Solomon, 2009, 172). An individual motivation occurs when their system gets aroused and driven toward an appropriate behavior in attempts to satisfy a desired goal. To the consumer, this internal drive can be viewed as either a need or a want that an individual has towards a particular product (Smith & Mackie, 2007). What motivates one person to have a preference of Crunchy Nuts may differ from what motivates one to Nicely Nutty Muesli. Different ideas have since been developed regarding motivation that can refer to needs. These theories include Herzberg’s theory, Maslow’s theory, and Freud’s theory. Fredrick Herzberg theory, has categorized factors that cause dissatisfaction under dissatisfiers and those causing satisfaction as satisfier (Smith and Mackie, 2007). Dissastisfiers include factors such as salary, status, personal life, and work conditions relationship with senior sand peers, etc. while satisfiers include achievement, work, recognition, advancement, growth, etc. (Smith & Mackie, 2007) To Abraham Maslow, what motivates people to act is unfulfilled needs within them, and people often meet certain basic needs before being motivated to meet other higher needs. According to Smith and Mackie (2007), people often acquire their motives through genetic endowment and social interaction in which some would be considered more important than others. As such, Maslow developed a hierarchy of human needs into five levels, which human seeks to satisfy depending on the need starting from the most basic of all (Perner, 2010). The figure below illustrates the Maslow’s hierarchy of needs as adapted from Smith and Mackie (2007)’s work. Need Level Description and example Self-Actualization Needs A desire to know, understand, systematize, organize or construct a system of values e.g. self-development and realization. Esteem Needs Striving to achieve a high standing relative to others e.g. self-esteem, recognition or status Social Needs Striving to be accepted by family members and close friends for instance seeking a sense of belonging and love Safety Needs Concern over physical survival for example seeking protection, security and peace of mind. Physiological Needs Necessity for survival, for instance food, water, shelter, sleep or sex. Physiological needs must be satisfied before one start seeking more complex need like love, friendship, and belonging. According to Freud, there are unconscious psychological forces that shape a consumer’s behavior, and the consumer cannot fully understand their motivations (Smith & Mackie, 2007). That is to say a consumer whether a child or an adult will examine a product and react to it specifically in accordance with their innate capabilities and quite unconscious cue such as shape, weight, size or brand. Different consumers have different things that motivate them, and so there are different types of motivations. These include: Incentive: Some consumers are motivated by the knowledge that they would eventually get a reward by doing something; marketing firms can use bonuses and promotions as incentive to get these kinds of consumers (Smith & Mackie, 2007). Fear: This is a form of motivation that involves the use of consequences to achieve the set goals, always accompanied by a penalty failure to achieve the set target. Achievement: Commonly referred to as the drive for competency, is where one is driven to achieve goals and tackle new challenges and improve one’s skills and competency (Smith & Mackie, 2007). Growth: This need for self-improvement is an internal motivation which can be characterized as a burning desire to increase and improves one’s knowledge of oneself and the outside world (Smith & Mackie, 2007). Nicely Nutty Muesli breakfast cereals are composed of fully toasted and packed cashews and almonds. They are suitable for vegans and those who are avoiding honey due to fructose malabsorption as such one can be motivated to have this Table of Plenty product for breakfast (Smith & Mackie, 2007). On the other hand, Crunchy Nut has that good taste that can be a source of motivation that make one have a high appetitive desire towards this Kellogg’s product (Kellogg’s website). These two products thus have closely, but different motivations that make consumers seek to satisfy each moment one opt for one rather than the other (Oskamp & Schultz, 2005). Arousal or process of motivation The motivational processes involve steps the consumer takes to get motivated. If the process is followed closely, then there are eventual credible results. Notably the process will demand little work and foresight and adequate planning on the consumer’s part (Smith & Mackie, 2007). Furthermore, the arousal of any particular set of needs at a particular moment may be caused by internal stimuli which are based in an individual physiological condition, by emotional or cognitive processes or by stimuli from the external environment (Hockenbury & Hockenbury, 2007). The figure below shows the process as adapted from Perner (2010)’s work: Figure 1. An illustration of the process of consumer motivation Personality Personality refers to perceived personal characteristics that are consistently exhibited, especially when one acts in the presence of others (Smith & Mackie, 2007). According to Perner (2010), in some cases the behavior one projects in a condition is similar to the behaviors a person exhibits in another situation. For marketers, it is of importance to know that consumers make purchase choices to support their theory. Therefore, using various research techniques to identify how consumers view themselves give marketing companies insight into products and promotion options that are not clear (Smith & Mackie, 2007). For instance, marketing strategists for Nicely Nutty Muesli breakfast cereals can develop a strategy around consumers who have fructose malabsorption offering them the opportunity to have the cereals that have no honey content. While marketers examine consumers they build marketing strategies around more obvious clues to consumption behavior such as consumers’ demographic indicators (Perner, 2010). Researchers have developed personality theories based on their own interpretation of personality traits. Traits can be defined as any distinguishable, relatively enduring way in which one person is different from another. Neo-Freudian theory asserts that social relationships are quite fundamental towards the formation and development of personality (Smith & Mackie, 2007). A lot of efforts are placed to overcome the feelings of inferiority, and so people continuously seek to establish significant and rewarding relationship with other as a way of reducing tension or anxiety. Therefore, Australian Marketers who position their products or services as providing an opportunity to belong or to be appreciated by others in a group or social setting would seem likely to be guided by characterization of the detached individual. Trait theory asserts that a person’s personality is composed of definite predisposition attributes called traits that make one person different from the other (Perner, 2010). According to Hockenbury & Hockenbury (2007), trait researchers have found that personality affect how consumers make choices and purchase or consume a broad product category rather than a specific brand. As such understanding consumer behavior is the most challenging concept in Australian marketing strategy. This understanding would shed considerable light on what is important for consumers as well as suggest some of the most important influences on customer decision-making process (Novack, 2010). Noteworthy, consumers purchase products to reflect their unique personalities. Therefore, Australian marketers must develop their products, advertising and promotional campaigns taking into the account personality types of their target customers (Daily News, 2013). According to Smith and Mackie (2007), marketers’ interest in consumers’ personality is primarily based upon the assumption that in spite of their uniqueness as individuals, members of groups and aggregates may possess a given trait or personality type common with each other (Dahl, 2002). Additionally, the easier an Australian marketer understands the type of customers he/she is dealing with the easier it is to sell and cross-sell to them. Marketing adverts of Crunchy Nut will easily sell to consumers with child-like personality implying that those who are easily influenced emotionally while Nicely Nutty Muesli will easily sell even to those with mature adult type of personality (Kellogs Websites; Table of Plenty website). This is because the later type of personality is not easily influenced by emotion and is often hard to crack unless properly and cautiously convinced as to why the breakfast cereal is appropriate for them (Dahl, 2002). Perception In marketing, perception can refer to an approach of identifying, organizing and interpreting consumer information to create meaning. Generally, a consumer will selectively perceive what they will ultimately classify as their most need or wants (Perner, 2010). The customer's perceptions about a business and its products or services have quite a dramatic effect on their buying behavior. This explains why different Australian firms spend a lot of money in advertisement to favorably influence the perception of target consumers. Accordingly, with considerable careful planning and suitable execution, an Australian marketing firm can influence customers’ perception and foster profitable consumer behavior towards a business of interest (Hockenbury & Hockenbury, 2007). According to Perner (2010), this influence can be done through trickery and manipulative ways or by simply presenting the company in question in the best possible light. In so doing, the firms make their products not only exposed to the general public but also make the firms products to stand out from the competitive crowd. According to Smith and Mackie (2007), perception can be seen as the process of selecting, organizing, and interpreting information inputs to produce meaning. Generally, people receive numerous pieces of information but only a few reach their awareness by selective exposure, a process through which an individual selects which inputs will reach awareness. A person’s current set of needs affects greatly his/her selective exposure with preference to give depending on one’s strongest need (Hockenbury & Hockenbury, 2007). One’s selective perceptions can easily results into two phenomena, namely: selective distortion and selective retention. Selective distortion occurs when one receives information which is inconsistent with one’s personal feelings or beliefs and so one opt to twist or change the received information. On the other hand, with selective retention, a person tends to remember information inputs that suitably support one’s personal feelings and beliefs (Smith & Mackie, 2007). After perception, an individual mentally organizes and properly integrates the newly received information with what is already stored in thought in such a way as to produce meaning (Perner, 2010). Thereafter one assigns the meaning to the organized information and so one interprets the received information based upon what one expects or to what one is familiar with. Since marketers cannot possibly have control of customers’ perception about firm or products, they try to entice them through different stimuli such as information exposure (Novack, 2010). This strategy depends on the assumption that consumer satisfaction depends on the information they have about a product. Kellogs and Table of Plenty firms use this information to influence consumers through the use of internet; popular social Medias like Facebook and twitter (Kellogg’s Website; Table of Plenty Websites). Learning Dahl (2002), refer to this process as changes in a person’s though processes and behaviors due to the consistently received information and experience. Furthermore, this learning process is greatly influenced by the consequences of an individual’s behavior as such behavior with satisfying results often tends to be repeated. Unlike inexperienced consumers who may opt to use different and more simplistic types of information, experienced buyers are familiar with the offered products and purchase situation and so tend to buy things quite consciously (Novack, 2010). Taking this into consideration, Australian marketing firms assist consumers to get to learn about their products by helping them gain experience with them through different ways such as free samples, in-store demonstrations, and test drives. Attitudes Attitude in marketing terms can refer to the general evaluation of a product or service created over time (Solomon, 2008). Perner (2010) defines consumer attitude as a composition of a consumer’s beliefs, feelings, and behavioral tendencies toward some tangible or intangible object or idea within the context of marketing. A consumer can hold either negative or positive beliefs or feelings toward a specific firm, product or service. The consumer attitude can be both an obstacle and an advantage to a marketing firm. Also, attitude can be viewed as a learned predisposition to proceed in favor of or opposed to a given object or product and therefore outside influences can easily persuade a consumer’s opinion of a product or service (Novack, 2010). This may include how the product is marketed or how the Australian marketing personnel’s approach the clients as this can either tune on the consumers attitude or tune them off completely. A good example is Crunchy Nuts advert (Appendix 1 and 2) which has an emphasis on how the cereal tastes. It is meant to tune on consumers and so arouse their desires to have a taste of the breakfast cereals (Kellog’s website). In addition, the two firms use brightly colored pictures to demonstrate the products for sale and through this they tend to appeal to consumers attitude. It can be said that within the context of marketing, an attitude can be used as a filter upon which every product and service is scrutinized (Solomon, 2008). For Smith and Mackie (2007), an attitude consists of three major components, namely: cognitive (basically knowledge and information about an object or idea; secondly, affective actions regarding an object or idea) and behavioral which is actions regarding an object or an idea. Australian Marketers must thus ensure to measure consumers attitudes towards prices, packaging designs, brand names, advertisement, salespersons, repair locations, features of existing or proposed products and social responsibility activities (Solomon, 2009). Novack (2010) pointed out some of the methods that marketers can use to gauge consumer's attitudes such as the use of direct questioning of consumers through the internet and social media. According to Oskamp and Schultz (2005), attitudes form directly as a result of experience, either personal experience or personal observation. Notably social roles and social norms play a strong influence on attitudes. Australian Marketing firms use classical conditioning to influence consumer’s attitude toward a specific product. For instance, in Kellogg’s offers and promotions page (Kellogg’s website), a couple is shown enjoying breakfast cereals. This attractive and appealing imagery causes one to develop a positive association with the use of Kellogg’s cereals for breakfast. Furthermore, people can also develop attitudes by observing the people around them (Solomon, 2009). One can start having a positive attitude towards the consumption of Crunchy Nuts simply because people around them tend to use and enjoy Crunchy Nuts cereals for breakfast. Similarly, one can develop a negative attitude towards Nicely Nutty Muesli because people around them have similar attitudes (Kellogs Website; Table of Plenty website). Learning theories of attitude such as the classical conditioning, observational learning can also aid in changing one’s attitude. Classical conditioning can be used to create certain emotional reactions towards a product by associating positive feelings with the target objects, while operant conditioning can be used to strengthen desirable position and weaken undesirable one (Perner, 2010). Again people can change their attitude after observing their behavior of other (Oskamp & Schultz, 2005). Conclusion The knowledge of consumer's inner characteristics helps Australian marketing firms design proper strategies to make the ever changing taste and preference of consumers. Manufacturing firms also rely on this information to determine what motivates customers as well as their diverse personalities and so design products to satisfy the desires. Australian marketing firms must also research on the consumer’s attitude towards the various products, their perceptions and ensure they are promptly informed of the available products. This will ensure that the companies in question make a good sale of their products and remain competitive in the market. References Crunchy Nut. (n.d.). Retrieved November 23, 2014, from Daily News. (May 13, 2013). “IFS to Focus on Consumer Behaviours, Adapt Retail Supply Chain.” (Colombo, Sri Lanka). Retrieved November 23, 2014, from Dahl, D. (2002) Social Influence and Consumer Behavior: Journal of Consumer Research, Iii-V. Hockenbury, D. & Hockenbury, S. E. (2007). Discovering Psychology. New York, NY: Worth Publishers. Nourishing you for life! Table of Plenty (Creative Cereals). (n.d.). Retrieved November 23, 2014, from Novack, J. (2010). “Internal influences – lifestyle and attitude.” Retrieved, November 23, 2014, from Oskamp, S. & Schultz, W. (2005). Attitudes and opinions. NJ: Lawrence Erlbaum Associates. Perner, L. (2010). “Consumer Behavior: The Psychology of Marketing.” Retrieved on November 23rd 2014, from Smith, E. R. & Mackie, D. M. (2007). Social Psychology. London: Psychology Press. Solomon, M. (2009). Consumer behavior buying, having, and being (8th ed.). NJ: Pearson Prentice Hall: 37-312. Appendices Appendix 1 Crunchy Nut The trouble is they taste too good™. Find out why people can’t wait to dig into this crunchy, nutty, and perfectly sweet taste sensation. Visit crunchynutville.com.au Appendix 2 Products Customer Corner Recipes Online Shop Who We Are Contact Us Special Promotions Free Gift Offer Free Gift Offer Top Dear Customer, Below are instructions regarding how to claim the free gift offer. MUESLI: Send us proof of purchase of 3 of our mueslis and we will send you a gift! You can send your receipt or 3 barcodes. Please make sure to provide your name, contact details, address and e-mail and phone number (so we can contact you if there is any issue). Send to: Factory 27, 148 Chesterville Rd, Moorabbin Vic 3189 Australia Or You can also photograph and email this proof to: info@tableofplenty.com.au Terms and Conditions: 1. Please allow 4 to 6 weeks for the delivery of the gift. 2. Offer limited to one gift per person. 3. Gifts will only be processed when sent to the address above or email (no other address please) 4. The gift changes from time to time - we aim to surprise you :-) Thank you for supporting our family business. Home | Contact us | Privacy | Sitemap Table of Plenty © 2014 Read More