The Impact of Brand Value on Brand Selection - Term Paper Example

Table of Contents Particulars Page No 1.0 Introduction 2 2.0 Consumer Behaviour and Market Analysis 3 3.0 Internal Factors Affecting Consumer Decision Making Process 4 3.1 Consumer needs and motivation 4 3.2 Consumer Perception 5 3.3 Consumer learning and Involvement 6 3.4 Consumer attitude development and change 7 3.5 Consumer Personality and Self-concept 8 4.0 Internal Factors of Consumer Behaviour and Marketing Mix 11 5.0 STP Strategy and Internal Factors Affecting Consumer Buying Process 14 6.0 Diffusion of Innovation and Social Change 14 7.0 Conclusion 15 1.0 Introduction Samsung Smartphone has been successful in tapping a huge market of Smartphone and has emerged as tough competitors to the larger giants like Apple, Nokia etc which has amplified the need to study the internal factors affecting the consumer decision making of such products. This report has been specifically drafted to highlight upon the internal factors affecting consumer decision making process of purchasers in context to Samsung Smartphone. For providing a better and in-depth analysis of the study various internal factors like consumer needs and motivation, personality and self-development, perception of consumers towards Smartphone, consumers learning and involvement towards the products etc has been discussed in detail. Furthermore the report makes an effort to provide readers with an understanding of the influence of internal factors affecting consumer behaviour being closely linked to the marketing mix elements of Samsung Smartphone along with the STP strategy formed and executed by the company. A discussion of how the internal factors affecting consumer decision making process is linked to the broader external factors like diffusion to innovations and social change has also been presented long with a conclusion to the entire topic to ensure both practical and theoretical understanding to all its readers. 2.0 Consumer Behaviour and Market Analysis Consumers are highly complex entities who on a continuous basis look towards satisfaction of their innumerable needs, want and desires through the use of different products which best match or suits their needs. Study in the field of consumer decision making process has identified five critical steps which a consumer usually go through before making the final purchase of the product or service which are problem recognition, information seeking, evaluation of various alternatives available to the consumer, purchase decision and lastly post-purchase behaviour by recognizing different marketing factors. There are various factors which play a dominant role in attracting the consumer towards a particular product or service which are both internal and external in nature. Internal factors are critical factors which largely depend as a part of the consumer and include various personal factors such as age, education, self-concept, learning and knowledge, attitude, motive etc. External influence is based on various social environmental factors of the consumer including influence of intimate groups and influence of broad social class. Internal and external factors are highly significant in the consumer decision making process as it can ensure not just one time sell but repetitive purchase of the same product by same of different consumers. Internal influences highlight perception, learning, memory, motives, personality and attitudes which have an impact on the consumer decision of whether to buy a specific product or not. On the other hand external influence showcase culture, sub-culture, demographics, social status, role of reference groups, family and other allied marketing activities. All this factors play dominance role in consumer buying behaviour. Furthermore, consumers are also open to new and different products as they are flexible in nature and urge for better products or services which suits their needs and preferences. Hence it is important for the marketer to continuously identify all such internal and external influence to ensure better sales of their products offered and achieve sustainable competitive advantage over their existing and potential new rivals. 3.0 Internal Factors Affecting Consumer Decision Making Process Consumer behaviour is a subjective term as the consumer decision making process is influenced and affecting a lot many internal and external factors. Internal factors are more of personal influences like perceptions, attitudes, learning styles, motivation and life roles which play a significant role in the purchase decision of any product/service. Let us have a look at the various internal factors affecting consumer decision making process in context to Samsung Smartphone which is discussed as under. 3.1Consumer Needs and Motivation The most significant or important internal or personal factor affecting consumer decision making process is the personal need and motive of the consumer towards the product or service offered (Samsung Smartphone in this context). The need of the consumer can be identified as a lack of something or the difference between the desired state to the actual state. Motive on the other hand is the consumer’s inner state which boosts him to find a desired product/service to satisfy his urged need. For instance, a consumer may be using a mobile phone which lacked advanced features like e-mail facilities, internet connectivity, no video calls, gaming experience etc which is his/her current or actual state and may urge towards a better product which could be a Smartphone with latest and advanced technology. This need or desire would motivate the consumer to discover various Smartphone available in the market and satisfy his need generated by purchasing a Samsung Smartphone. Thus by identifying this need and motivation of consumers, Samsung can easily influence consumers towards the purchase of its Smartphone. The most substantial need identification model which could be used is the Maslow Need Theory. For instance a consumer may looked towards Samsung Smartphone for new gaming experience or a consumer may look towards the same for ensuring better quality with affordable price in context to Apple Smartphone available in the phone (Hollebeek, 2011). Thus different consumer may have different need and motives towards the same product which needs to be identified by the marketer which shall help the marketer in better segmenting of its targeted market and serve the consumer needs and wants in most effective manner. 3.2 Consumer Perception Consumer Perception is again an important internal factor which affects the consumer decision making process as it helps in recognizing, organizing and selecting a product or service among the various similar products offered in the market by different competitors. Perception of the product can be understood as the awareness towards the product as just getting consumer attention is not enough to ensure success in the dynamic market. Consumers only make the actual decision of purchasing the product when they perceive that the product shall be able to satisfy their need and wants. Thus, it can be concluded that it is the consumer’s perception which leads them to actually buy the product. One perception which is of significant importance is the level of perceived risk in potential buying of the products or services. There may be numerous risks to the same like functional risks, financial risks, physical, psychological, social or time based risks. Perception is further an individual process which is affected by various internal factors such as customer’s beliefs, need and wants, experiences, moods and desired expectation from the product. The product itself acts as stimuli in accelerating the perception of consumers in terms of the products sizes, colours, intensity and in the prime context in which the product/service is seen or heard. Consumer perception is thus an important internal factor in the buying behaviour of consumer towards a product or service which the marketer needs to continuously identify and develop marketing strategies towards the same. For instance, Samsung uses many slogans in their ads to perceive their consumers. Famous slogan like “The Next Generation Phones” itself perceives the consumers that the product is characterised with latest advanced technology and is to serve their needs for a longer duration than similar other Smartphone available in the market. One thing to understand about Samsung Perception is Value as they always strive to give their consumers a perception of higher and better value than offered by their competitors. 3.3 Consumer Learning and Involvement Consumer learning and involvement is also significant in the consumer buying behaviours as it determine the series of steps by which information related to the products or services can be encountered through the senses of the consumer and stored in the minds of the consumer. Learning can be viewed as a relatively permanent change in the consumer behaviour which is due to the information gathered or experienced both directly and indirectly towards the product or service. Advertisement is one such great tool used by Samsung to ensure better consumer learning and involvement of its consumers towards its Smartphone. Samsung in its ads try to give happiness to its customers and when the customers are actually happy towards the product and its usage it helps in creating a strong internal drive which results in positive reinforcement. The ads are created to create a strong internal stimulus in the consumers towards the use of Samsung Smartphone. Consumer involvement is an important variable which helps in explaining how consumers process the information and how such information might influence their purchase decision of the final product. Operant conditioning or instrumental conditioning is of the view that consumers act as active participant in the learning process by enacting on all or some of the environmental aspects. This individual’s responses lead to either two outcomes which could be positive reinforcement in terms of rewards or could be negative reinforcements in terms of punishments. Thus, behaviour is a function of its consequences. A favourable consequence or reward in context to a specific behaviour is thus an important element in context to personal perception. Reinforced behaviour strongly acts as element which links both stimulus and responses. For instance, if a consumer develops a positive response towards a product by actually purchasing the product then the chances that the consumer will use the product again and recommend to their peers is increased to a considerable extent. Conversely, if the outcome is unfavourable, then the chance of repurchase decreases along with negative influence on the mind of the peers towards the products. 3.4 Consumer Attitude Development and Change The next internal factor which substantially has a strong influence on the consumer decision making process is their own attitude towards the product or service. Attitude is an individual’s own likes or dislikes feelings about something. It can also be viewed as the judgement. Consumers have different attitudes towards different things which are relevant to the product, its brands, companies, celebrities, advertisements etc. Attitudes gain much importance in the object evaluation process of the products which could be either favourable or unfavourable. Research in the field of consumer behaviour supports the clear assumption that consumers attitude has strong influence on the final purchase of the product during the decision making process (Isabella, 2012). Once a positive or negative attitude is formed by a consumer in his/her mind towards a particular product or service it is difficult for the marketers to change them. Attitude of consumer can be easily reflected in an individual acts as well as in their buying patterns. Thus attitudes help marketer in identifying their position in the market and how well they are established in the overall market place. Identification of this attitude can help Samsung in knowing their consumers and their perception towards Smartphone. Samsung has been constantly looking to develop advertisements endeavouring to change the attitude of its consumers by giving them pleasure. Samsung has ensured that its products are designed towards consumer attitudes which may vary with different dimensions in terms of its directions, strength and stability. 3.5 Consumer Personality and Self-concept Another internal factor which affects consumer decision making process is the consumer personality and self-concept of consumers towards the potential purchase of a product or service. Self-concept implies the set of perceptions towards one-self and how the perception of one’s abilities is in relation to perception of others and towards the products. It is also identified as the self-image and how an individual actually views himself. Consumers or individuals develop their own self-concept ad change them as per their interaction between the psychological and social dimensions revolving around them. Research in the past have highlighted that consumers are more comfortable to those purchases which reflects and enhances their own self-concept about the product or service which further enhances and maintains their self-concept (BHATTACHERJEE, and PREMKUMAR, 2004). Self-concept in a nutshell may influence the consumer to buy a specific product in a list of product categories offered by different manufacturers and further may affect the brand selection along with the place to buy the product at the same time. Self-concept may be categorised in terms of three broad components which are: Self-image( How an individual views himself) Self- esteem (How an individual values himself) and Ideal self ( What an individual desires or wish to be) These three components literally affect the consumer buying pattern in terms of every product or service purchased. During the decision making process, the buyer always keep in mind of what he thinks of himself and how he values himself and how the product or the service purchased will be able to meet his/her future desires and wish. Consumers generally tend to buy those products and services which they belief to posses symbolic images which are similar and complementary to their own self-image. For instance, consumers may buy Samsung Smartphone to reinforce or strengthen their status in the society along with a better lifestyle and a symbol of higher standard of living in the society. Consumers may develop their own concept towards a product or service for instance consumers may develop a concept that Smartphone are always costlier and their value to the benefit derived is lower and hence may deny the purchase of the Smartphone on the other hand there may be a set of consumers who may develop self-concept that Smartphone are the need of the hour and it makes task easier along with added entertainment and allied benefits. Thus the marketers need to concentrate on the consumers who had already developed a negative self-concept towards the product and develop marketing strategies to ensure a conversion of the self-concept of the negativity towards actually reality which the product delivers. Personality on the other hand accounts for consistent patterns of behaviour and traits which make a consumer unique and different from others. Personality describes an individual’s disposition and how one individual is different from the other and encompasses unique traits as it exhibits the visible human internal traits and behaviours. The several traits on which personality of an individual may differ from the other are self-confidence, dominance, autonomy, adaptability and sociability (Azad and Safaei, 2012). Consumers are more likely to purchase a product that match up to their specific individual personality. It has been viewed that consumers personally tends to identify and associate themselves to certain brands and use the same as a means of self-expression. Thus it concludes that brands of the product are also perceived to reflect the personality of a consumer. Recent survey reveals that younger generation is more inclined towards the use of Smartphone whereas the older generation finds the same as more complicated and less supporting to their personality. Thus the Samsung marketers need to ensure better targeting of the older generation and develop Smartphone which are easier to navigate and suits the personality of all users. Thus we see there are many aforesaid internal factors which affect the consumer decision making process and are equally important as external factors affecting consumer decision making process. The marketers of Samsung on a continuous basis need to identify the aforesaid internal factors affecting consumer buying behaviour towards their Smartphone and develop strategies accordingly so as to ensure better returns and further ensure sustainable competitive advantage over its existing and potential rivals. 4.0 Internal Factors of Consumer Behaviour and Marketing Mix This section of the report endeavours to establish a link of the various aforesaid internal factors affecting consumer decision making process being linked to the marketing mix of Samsung Smartphone. The 4P’s of the marketing mix in context to Samsung Smartphone are discussed as under. Price: Pricing strategies act as crucial factor in the consumer decision making process as this can be directly linked to the various internal factors affecting consumer decision making process. For instance, consumers have a perception and belief that that the high price charged by Apple for its IOS Smartphone is due to the higher value the product is designed to deliver in comparison to Samsung Smartphone which needs to be addressed by the marketers so as to potentially switch the customer from Apple and other Smartphone manufacturers to Samsung Smartphone. Samsung for this instance try to use competitive pricing strategy and deliver web based ads and portals which make a clear comparison of higher value which Samsung Smartphone provide in comparison to other competitors in terms of both value and pricing is concern. Promotion: Promotion is yet another marketing mix stimuli which of considerable importance and can be closely linked to the internal factors affecting consumer decision making process. Perception of the consumers in terms of the product itself, packaging, brand name, advertisement, commercials etc all has considerable influence on the consumer decision making process. For instance, Samsung looks to promote its Smartphone by designing ads and celebrity endorsements which stays in the memory of the consumers for longer duration and act as stimuli towards the purchase of the product. Promotion further helps the consumer in evaluation of various alternatives available in the market and selection of the most suited one where internal factors such as self-concept and personality of the consumer are targeted upon. Promotions usually has four distinct elements which are advertising, public relations, personal selling and sales promotion which all acts as dominating factor to persuade consumers by activating the need and motive stimuli of the personal internal factors influencing consumer decision towards the actual purchase of a specific product or service. Place: This element of marketing mix can be linked to the internal factors affecting consumer decision making process in terms of easy accessibility of the products or services. Consumers belief and develop attitude that products which are readily available in the market are likely to be better purchased than importing the goods from different region which always attracts associate risk of damage and pilferage. Furthermore, Samsung Smartphone has service centres all across the globe which ensures consumers of easy maintenance of their Smartphone in case of any damage or malfunctioning and is an important factor which stimulates the sales of Samsung Smartphone over its near competitor like Apple. Furthermore in-store environment acts as stimuli which influence the consumers’ mood and willingness to visit and move around. Samsung uses its own exclusive stores to attract more consumers and easy accessibility of its products which increases the consumers perception not just on the quality of the products but helps in enhanced satisfaction and repeated visits to the stores for purchase of Samsung Smartphone. Product: Product is a marketing mix element which again has strong links with the internal factor affecting consumer decision making process as the same is directly linked to consumers perception about the product and whether the offered product match up the needs and motives of the consumers and help in establishing a stable self-concept or not. For instance the new Smartphone of Samsung is designed in a manner with provides consumers to satisfy multiple needs and motives like real-time gaming experiences, high-definition cameras, smart touch, eye detector etc. Research has shown that apart all factors be it external or internal affecting consumer decision making process the product marketing mix is the most significant as it is the product is to be purchased and all factors revolve around it. Thus we see that the marketing mix of any product (Samsung Smartphone in this context) is closely associated to the various internal factors affecting the consumer decision making process and marketers need to consider the same minutely so as to ensure better segmentation and targeting of its products. Let us now have a look at the STP strategy of Samsung Smartphone and how the same acts as important element in the various internal factors affecting consumer decision making process. 5.0 STP Strategy and Internal Factors Affecting Consumer Buying Process Samsung Smartphone has a large global market to tap for and it is important for the marketers to identify and understand the impact of various internal factors which affects the consumer decision making process. With the help of the aforesaid discussion Samsung looks to segment its consumers on basis demographic, psychographic, location and culture. In context to demographic segmentation, Samsung can look upon various personal factors affecting consumer decision making process like segmentation on basis of age, income, gender and education level. It can look to target both middle and higher income level for its Smartphone to broaden the scope of its market base. On basis of psychographic segmentation the Smartphone market can be targeted on various traits or internal factors affecting consumer decision making process such as on basis of attitude towards the usage of product, attitude towards price, opinion about the product, self-concept of the product etc. In context to culture and location market can be segmented on basis of different need and motives of the consumers. The selected targeted market can be affected positively by ensuring higher value to the products offered by Samsung. Samsung should look to position its Smartphone in the market to meet consumer motives and desires and compete with competitors such as Apple and Nokia which can be achieved by targeting and designing products with latest technological up gradation so as to meet the internal or personal factors affecting the consumer decision making process. 6.0 Diffusion of Innovation and Social Change Diffusion of Innovation and Social Change are strong external factors affecting the consumer decision making process. However the same can be closely linked to the internal factors affecting consumer decision making process as they occur due to personal factors of different consumers. Diffusion of innovation in simple sense implies new ideas and practices being spread across and absorbed by consumers in the society. Innovation is characterised with higher associated market risk of being absorbed by the society and looks towards a social change in the society but however with risks comes rewards in the form of superior products being designed and accepted by consumers with rewards in the form of higher sales and profitability and sustainable competitive advantage over the existing and potential rivals in the market place (Carpenter and Nakamoto, 2009). Innovation further varies during different phases or stages of the product life cycle. For instance, innovation in the Smartphone Industry has been rapid with new and advanced features being designed and equipped in new mobile phones as per customer needs and preferences and aim towards social change in both the minds and usage of the products by the consumers. The latest Samsung Smartphone is designed with latest and best technological up-gradation and looks to deliver benefits which no other Smartphone in the market delivers. Consumers on a continuous basis looks towards changes in the society as it is the nature of the human beings to look towards better and advanced products to satisfy their need and motive. 7.0 Conclusion The report has been designed in a synchronised and coordinated manner to highlight upon the various internal factors which affects and influences the consumer decision making process. The report to provide a better understanding looks upon Samsung Smartphone as a specific product however the factors and their influence can be generalised on all identified products and services available in the market. The report explains in detail the various internal factors such as consumer needs and motivation, personality and self-concept, consumer learning and involvement, consumer perception and consumer attitude development and change affecting consumer decision making process. The report also looks to explain the various marketing mix being linked to internal factors and how the same can be used by marketer for better absorption of the product in the marketplace. Furthermore a discussion is made on the diffusion of innovation and social change which are external factors affecting consumer decision making process but how the same are a result of various internal or personal factors affecting consumer decision making process. The report thus looks to ensure both practical and theoretical understanding to all its readers. References Azad, N. and M. Safaei, (2012). The impact of brand value on brand selection: Case study of mobile phone selection. Management Science Letters, 2(1): 1233-1238 BHATTACHERJEE, A. and PREMKUMAR, G., (2004). Understanding changes in belief and attitude toward information technology usage: a theoretical model and longitudinal test. MIS Quarterly, 28(2), pp. 229-254. Carpenter, G. S. and K. Nakamoto. (2009). “Consumer Preference Formation and Pioneering Advantage.” Journal of Marketing Research 26, 285-298. Hollebeek, L. D. (2011). Demystifying customer brand engagement: Exploring the loyalty nexus. Journal of Marketing Management, 27(7-8), 785-807. Isabella, G., (2012). Influence of discount price announcements on consumer’ behavior. Journal of Business Administration, 5(26): 657-671. Read More