Why They Buy: An Introduction | Michael Solomon | Skillshare

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Taught by industry leaders & working professionals
Topics include illustration, design, photography, and more

Lessons in This Class

6 Lessons (39m)
    • 1. 0.1 An intro to the course and to me

    • 2. 0.2 Why Marketing Rules

    • 3. 0.3 Wants versus needs

    • 4. 0.4 So, what do your customers need?

    • 5. 0.5 What is Consumer Behavior?

    • 6. 0.6 The importance of empathy for marketing success

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About This Class


This class is the first installment in a series that will explore the mysteries of consumer behavior.  

Marketing begins and ends with the customer, from determining customers' needs and wants to providing customer satisfaction and maintaining customer relationships. We'll take a deep dive into the basic concepts and principles in consumer behavior to help you apply what you learn to your own business.  If you don't understand why they buy, you can't give 'em what they want!

Each installment will explore one facet of consumer behavior.  If you take all of my courses, you'll be much better-equipped to understand what drives your own customers!  

Meet Your Teacher

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Michael Solomon

Expert on Consumer Behavior


Hello, I'm Michael.  Here's some background about me and what I do:

Michael “wrote the book” on understanding consumers. Literally. Hundreds of thousands of business students have learned about Marketing from his 30+ books including Consumer Behavior: Buying, Having, and Being -- the most widely used book on the subject in the world.

 Michael’s mantra: We don’t buy products because of what they do. We buy them because of what they mean. He advises global clients in leading industries such as apparel and footwear (Calvin Klein, Levi Strauss, Under Armour, Timberland), financial services and e-commerce (eBay, Progressive), CPG (Procter & Gamble, Campbell’s), retailing (H&M), sports (CrossFit, Philadelphia Eagles), manufacturing (DuPont... See full profile

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1. 0.1 An intro to the course and to me: Hi there. And welcome. Let me jump in by asking you some questions. Are you fascinated by consumer behavior by all of the brands that are out there that people are absolutely crazy about? What is it that makes people wait out in the rain and snow, sometimes overnight or even for days for products like the iPhone that they absolutely have to have right now and then, On the other hand, there are a lot of brands out there that they could just take relief. They're really not interested in them at all. What is it about those people, or what is it about those brands that makes that kind of connection? What about your own customers? Do you ever wish that you could understand them better? Do you ever wish that you could learn why it is that you can put together what you know is a great offering, a wonderful product or service a dynamite marketing campaign? And yet people just don't respond the way you want them to. I'm sure that can be very frustrating, but there are ways to understand your customers. So if you answered yes to any of those questions, you've come to the right place. My name is Michael Solomon, and I'm really excited to introduce my program on consumer behavior. I hope youll enjoy it, and I know that you're going to benefit from it. The basic idea behind the course is that I want to help you to see your customer in a new way. You're probably in the trenches every day trying to make really sound business decisions, but you don't often have the luxury to step back and really understand what it is about your customer. That's either turning them onto your offering or perhaps turning them off. And that's what I'm here to help you with. A lot of what I'm going to talk about you probably will think of as common sense, but it's common sense that has an important distinction because it's also backed by scientific research. So my goal during this program is to highlight a lot of different pieces of information and to give you a lot of strategic suggestions that on the one hand probably sound like common sense once I talk about them but on the other are backed by years of research that really support why it is that it's worth making. These changes were taking these suggestions. So let me start by telling you a little bit about myself. I'm a professor of marketing, currently at the House School of Business at ST Joseph's University in Philadelphia. I've been a marketing professor for more years than I care to think about. Prior to coming to ST Joseph's University, I was a professor at Auburn University, Rutgers University, and I began my career at New York University. In addition to being an academic, I've had the opportunity to consult with many different organizations on topics related to consumer behavior, advertising, retailing, social media and marketing strategy. So here you see some logos of some of the organizations that I've had the privilege of working with or that I'm currently working with today. In addition, I also spend a lot of time writing books. So I have been a textbook author for I hate to say it almost 30 years. You can see some of my textbooks here, and I'm proud to say that one of those textbooks is a book on the topic of consumer behavior, and it's the most widely used in the world. So I've had the opportunity over the years to revise this book many times. It's currently in the 12th edition, believe it or not, and I'm always learning. The field is always changing, and I'm happy to share some of those changes with you. But enough about me. We're here to help you learn and to help you benefit from what we know in the field about consumer behavior. 2. 0.2 Why Marketing Rules: let's begin with a fundamental question that you may be asking yourself right about now. And that is why is understanding consumer behavior so important to my business? I like to answer that question by starting with the story. And this story is that some years ago I was working as a consultant to a large advertising agency in Manhattan and the client that we were working on or with, at the time Waas, a company that made various kinds of personal care products for women. And they're still in business today. They do quite well. But there agency was trying to get a better handle on just who the customer waas so that they could devise some advertising executions that would appeal to that person. So as we started to talk to various people who were working on the account, what came out very clearly was that they had a very definite image in their minds of who the customer was for this particular product. And that customer Waas a young woman, probably in her twenties, maybe early thirties, at best, very cosmopolitan, very urbane. I love to shop at fancy stores, love to dress well, go out to glamorous places at night and on and on. I think you get the idea. So that was the customer. The image that they had in their minds and all of their work that followed really was based on speaking to that woman. So as we started to dig deeper into the data and toe look at who really was there customer , we found something quite different. In fact, we discovered that the typical customer for this particular product was actually a woman in her fifties who lived alone and had a lot of cats. So the woman actually looked a little bit more like this. And you can see that that is probably not as desirable a target, certainly not the one that these people wanted to work with. But that was the target nonetheless. And once we were able to convince the brand team that they were talking to the wrong person , they were able to substantially revamped their advertising campaign to speak to the woman who actually was there customer, and to engage her a bit more and to connect with her and, as a result of the brand did quite well on again, continues to do well to this day, but but still the average customer for this brand. It looks a bit more like the woman on the right than the woman on the left, so I can't tell you what the brand is, but I'll let you draw your own conclusions about that. So why is that important? Well, it reminds us what marketing is about. And let's just start with the basics here. Let's start with the definition of marketing as defined by the American Marketing Association, which is the trade group of the marketing industry, and the A M A. Describes marketing as follows the activity set of institutions and processes for creating , communicating, delivering and exchanging offerings that have value for customers, clients, partners and society at large. Whoa, man, that is a mouthful that is a very long and complicated definition. It's got some value to it, and it's worth understanding all the component parts. But but let's cut to the chase, Really, for our purposes, marketing is something more simple. Marketing really is satisfying your customers needs and doing so better than anyone else. So at the end of the day, if you are able to understand your customers to know what they want and to convince them that you have an offering or what we call a value proposition that is superior to your competitors. You were going to win the day. It's a simple is that And in fact, when you look around at various kinds of bumper stickers and posters that you see around the world, you see a lot of them like this. You know, drummers do it with a bang. Scientists do it repeatedly and on and on. So I think that a good way to keep in mind what marketing is about is maybe to think about a bumper sticker that might say something like Marketers do it to satisfy needs. That is really what it all boils down to. Marketers do it to satisfy needs now. Marketing wasn't always like that. We didn't always worry so much about customers needs, and so we can see. Even in the fairly brief period in which marketing has been a formal discipline and really has not been around very long, we can see that it's evolved through a variety of phases. So let's review those really quickly back in the day, especially back in the early 19 hundreds when when businesses started to get more sophisticated about their customers and thinking about the relationship between what they made and what the marketplace wanted, we entered a period of marketing that is often referred to as the production era, and the production era was exemplified by Henry Ford and the Model T and you. Everybody is familiar with the model T. Henry Ford was one of the pioneers of the modern assembly line, and he had the insight to understand that he could achieve remarkable economies of scale by mass producing even a complicated product like a an automobile. And so this was the production era because essentially, the approach was whatever we produce, they will buy. And there really wasn't much choice in the matter. In fact, there's a famous saying ascribed to Henry Ford. You may have heard of it, and it says that while he boasted, actually, my customers can have any color car they want as long as it's black. So that little saying I think really nicely summarizes the production era. We're going to give the customers what they want, as long as that's what we happen to be making at the time now. That approach quickly became outmoded, especially as other competitors entered the market. And, for example, General Motors got into the picture and started to offer alternatives to the Model T. So we soon morphed into a new era that's often called the sales era. And during the sales era, really, the perspective was, Let's see who does the best job of convincing customers that we have the best product. So it wasn't necessarily offering products that consumers genuinely need, but it certainly was a race to the bottom. I guess you could say to convince the customer that we have what you want, and so really, it became a matter of who is the best salesman who is able to come up with the best pitch and is going to convince customers that they have the best products. So really, marketing became more like a wrestling match and winner take all and again not too much consideration of the customer's needs and and certainly not very much interest in cultivating a long term relationship with the customer. So let's fast forward to today where that perspective is largely outmoded, and today we like to talk more about a relationship era, and you may have heard this term relationship marketing. And this is based on the understanding that we don't want to necessarily just sell a customer. One time we want to be there, go to alternative, perhaps for their entire life. And so marketers today like to talk about the lifetime value of a customer, and that reflects the recognition that we're going to make our money not by selling once, but by selling repeatedly. And it also reflects an understanding that is extremely important. And, ah, lot of companies don't really recognize this, And that understanding is that it is much more expensive to attract new customers than it is to keep old ones. It's more expensive to attract new customers than it is to keep old ones. So a lot of companies are always focused on where is my next customer coming from? And I think that at times they tend to ignore the fact that they already have perhaps a loyal set of customers, and they probably need to do more to keep those customers loyal because those are the people who were going to keep coming back time after time. You've already convinced them you have a quality offering, but they need that reassurance, and you need to maintain ah, strong bond with that loyal customer. 3. 0.3 Wants versus needs: as we think about relationships, we have to recognize that marketing really is not just about satisfying needs. It's really about satisfying wants. And then we get into the distinction between a need and a want. And this is Ah, this is an argument that marketers have all day long. You know, what is the difference between a need and a basically a need is a fundamental psychological or physiological characteristic or goal that we have to achieve, such as eating and drinking and sleeping, and perhaps being accepted by others or being admired by others. So that is an example of a need. But a want is a specific way to satisfy that need. And for every need we can define, there are many, many different ways to satisfy that need. So depending on which culture were from, depending on what is important to us, to different people can experience the same need but come up with very, very different ways to satisfy that need. And though that is the where the want comes in and that's where competition comes in in the marketing space, because what you're saying is Aiken satisfy your need, but your competitors also saying that, and the trick is to get your customer to choose your route to satisfying in need rather than your competition. So again, an example of a basic need is to eat. We all need to eat because otherwise bad things happen like we die of starvation. So obviously everybody needs to eat. Many of us think about food a lot, And, uh, of course, when we get hungry, that need becomes really paramount. And that's kind of all we can think about. But how do we satisfy that need? While we all have different ways to do that, we all have different priorities. Preferences, tastes, goals, etcetera. So some people are going to choose a big, juicy hamburger. Others are going to have a sweet tooth and would rather have a cookie, etcetera. So, of course, a lot of advertising and marketing communications are really intended to get you to think about satisfying your need for food in a specific way. And we have to bear in mind that a lot of this is culturally conditioned, so that something that is a great way to satisfy that hunger need in one culture might not be so great. In another and in fact, it might be something that we don't think of as being too desirable. So, for example, here is a picture of a nice couple in South Korea, and they're hungry. They're satisfying their need in a way that some of us might not choose to do. And what they're doing is they're they're eating a live octopus and sharing it in a very nice way. So the next time you get hungry, if you decide to satisfy your need that way, then perhaps you need to move to South Korea, where it's considered perfectly acceptable and desirable to do that. 4. 0.4 So, what do your customers need?: So how do we think about consumer needs? We know that we need to satisfy them. That's the basic, if you will, prime directive. If you're a Star Trek fan, the prime directive of marketing is to satisfy needs. And what we try to do is to understand those needs and to compartmentalize them so that at any given time we have a better understanding and insight into just what our customer is looking for. And over the years, researchers have identified many different kinds of needs. So, for example, we can talk about the need for affiliation. Of course, that's a psychological need, and that means that most of us, unless we are hermits and like to live alone in a mountaintop somewhere, I have a need to be around other people, and we have a need for acceptance. We wanna have friends, we want to join groups. We feel validated when we form connections with others. So in some cases, marketing strategies revolve around the idea that by using our product, you're going to strengthen your social connections. In contrast, sometimes people have a need for power, and what that means is they may want to be so called masters of the universe. They want to be the ones who call the shots. They want to be the ones who were waited on. They want to be the ones who feel that they are in control of the situation. So you can imagine that a person who has a need for power is not necessarily going to be interested in or susceptible to, the kind of appeal for a person who is having a strong need for affiliation. Another need is a need for uniqueness. And again, all three of these, of course, are psychological needs, a need to be distinct from others. I need to express your own identity to be your own person. That's a message that our culture often sends us. And so we may have products that basically tell you if you use our brand, you will not be like everybody else. You will be your own person, and you will be able to express yourself, and there are many other needs like that where we will talk about some of them further on in the course. But the general take away right now is that you need to understand needs. You need to look at your customers and ask yourself, What is it exactly that they're trying to accomplish when they choose to buying my products or services? Or perhaps they don't choose to buy them? What need are they looking for that you are not offering to satisfy? 5. 0.5 What is Consumer Behavior?: the focus on needs brings us around in a full circle to the basic topic of this course. And that is what is consumer behavior. Because those of us who study consumer behavior essentially are trying to figure out why do people do what they do and what needs did they satisfy? And what does that mean for their daily lives and how we understand them? So let's plunge into a long winded definition of consumer behavior. But I promise you that it's worthwhile because there are many different components to consumer behavior and that the discipline is actually more complicated than you might imagine. So here is the long winded definition, the process individuals or groups go through to select, purchase, use and dispose of goods, services, ideas or experiences to satisfy their needs and desires. So that's a long winded definition, just like the a amazed definition of marketing is kind of long winded but also valuable. Let's break it down a little bit and explore why we really need to have all of these different components for this kind of long winded definition. So, first of all consumer behavior is a process this is important to recognize What? What do we mean by a process? It means that usually there are Siris of steps that occur even though those steps may not be obvious to the casual observer. So we don't typically wake up in the morning and say, OK, I'm gonna buy a house today and just call up the real estate agent and send in our deposit Instead, we go through a very long process, perhaps a very tiring and rigorous process of trying to figure out exactly what our options are, narrowing them down, deciding what we can afford, where we want to be, what we want to do and on and on. So, obviously, some consumer decisions are much simple or than others. We don't go through that process when we're buying a pack of gum, perhaps, but in just about every decision you can identify, in fact, we can find a Siris of steps. This is important to us strategically because it allows us to identify opportunities and challenges during each of those steps, rather than just focusing on the outcome, which is the actual purchase. So that's why the process is so important. Individuals or groups, we think of a consumer decision as being one that's made by an individual by your customer . But the reality is that many consumer decisions are made by more than one person, so it may be a married couple. It may be a group of roommates. It may be a buying center in a large organization. So typically, the decision to buy, say, a new computer system for company is not made by any one individual, but rather by some kind of committee. And so group decisions are much more complicated than individual decisions. We need to understand that more. We also need to understand that even if the individuals involved don't necessarily make the purchase, they may be influencers. They may be people who are going to have a big impact on the purchase. A great example of that, which will talk about later in the course, is Children. So we know that Children have enormous impact on some of the decisions that families make. For example, where to go on vacation. If you're in the business of selling vacations, you need to recognize that it's not just the mom or the dad that is making that decision, and perhaps you need to get the Children on your side as well, so individuals and groups are often involved in these decisions. Next, we have a string of words here selecting, purchasing, using and disposing. So again, this reminds us that the word purchases in here. But purchase is only a small part of the process. Typically, before we actually fork over some money or a credit card to buy a product or service, we've gone through a very elaborate process, as I've already mentioned of looking at various options, deciding which ones are possibilities, narrowing them down, etcetera. Then we make the purchase, which, in and of itself can be very complicated. And again we'll talk more about that later in the course. But then we bring the objects home, and we have to use them in some way. This is often a bigger stumbling block than companies understand, because once people get something home, if it doesn't work well, obviously they're not going to buy it again. And they're not gonna be happy campers. In fact, many times the reason that something doesn't work is not that it is literally malfunctioning, but rather that the instructions air so complicated that people cannot figure out how to use it. So, for example, with Elektronik products, this is definitely the case, and a very high percentage of products that are returned to companies because they don't work actually work fine. It's just that the company neglected to focus on How can we facilitate the the consumers use of the product, perhaps by even writing clear instructions for a change and then finally, disposal. What do people do with products after they're done with them? Especially in our world today, where we have so many environmental concerns, the disposition of products is very important. In addition, we often have very significant so called gray market's or used markets where many of the products that we buy in fact are not bought directly from manufacturers or stores, but rather from other people. So companies really need to understand these processes as well. Next, we have goods, services, ideas or experiences. This is a great reminder that consumer behaviour applies not just to a can of peas or to a new car, not just to tangible items, but too many intangibles as well. And especially again today in our society, we find that many consumers are much more interested in intangibles than they are intangibles. And even if you're selling a tangible product, they're much less interested in what that product does, but rather the experience or the emotion that it creates. And we're gonna talk a lot about that. So services, ideas or experiences are extremely important. And it it almost doesn't matter what business you're in. I guarantee you to. Some extent you're not just selling a good you're selling and experience. You're selling an idea. And that idea might be hope. It might be sophistication. It might be a political agenda. It might be a religious agenda. All of these things are part and parcel of consumer behavior, and finally we come back to the basic definition of marketing and satisfying needs and desires. So once again, we can see that at the end of the day, if we are able to satisfy our consumers needs and again do it better than anybody else and let people know that we can do it better than anybody else, those air, both important, Then we will come out successful. But many times companies fail not because they have not satisfied needs, but rather because they haven't let consumers know that they're able to do this, they haven't communicated the true value proposition that they're selling. Perhaps they focused on Lee on what the product does rather than what it means, and that is a really, really bad mistake. 6. 0.6 The importance of empathy for marketing success: the key to marketing success is meeting your customers needs. So how can you do that unless you know what those needs are When you think about it, think about your own experience. How do you decide that you need a product or service? You're not only a business person, you're a consumer as well. And so you, yourself and your employees have great insights that perhaps you're not tapping based on your own experiences, perhaps either in your own line of business or when you go to buy things in other lines of business. How do you decide toe? Activate that process where you actually go into the marketplace and look at all your options and go through this whole complicated process. What is a sales person do that helps you in this process? What does a sales person do that turns you off? So we all have experiences in stores and, of course, on websites and other forms of distribution where we have great experiences, we have bad experiences that that may be totally independent of what the product is, and what that boils down to is really putting yourself in the shoes of the customer and as this cartoon suggests, you know, perhaps being able to experience the pain points that your customer has. Are you able to empathize with your customer? The way you can empathize with your customer is by understanding your customer. So the more you know about what makes him or her tick, the better the chance you have of being able to address that person's needs. And that's why I think empathy is an extremely important part of marketing that many business people tend to ignore. So we can define that as we do here, the ability to step into the shoes of another person, aiming to understand their feelings and perspectives, and to use that understanding to guide our actions. So empathy means being able to take the role of the other. If you contrarily put yourself in the shoes of the other person, then you can intuitively understand what it is that's going to rock their boat. What is it that's going to meet their needs? So psychologists, even when they look at young Children, find that kids very in terms of the amount of empathy that they're able to experience and developmental psychologists refer to this capability as a theory of mind. They find that popular Children, for example, have a more advanced theory of mind, so that the kid that everybody likes even in grade school tends to be the kid who is able to put him or herself into other shoes to get along with other people by having a more advanced understanding of what makes them tick. So if that works for kids on the playground, you can imagine how important and effective that approach is. When you're trying to sell a product or service to a grown up. So again we can ask a fundamental question. Who is your customer? And when I asked this question, I don't mean just tell me who they are. Demographically, that is. What is their age? What is their gender? What is their income, etcetera, Those air important questions. And we'll address those, of course. But more fundamentally I mean, who is your customer as an individual? What does that person think about? What does that person fantasize about? What do they dream about? What are their pain point? These are the questions you need to answer, and hopefully in an empathetic way so that you can put yourself in your customer's shoes and be in a better position to meet their needs. So the take away of all of this is basically don't assume that you know your customer. You may know what your customer looks like. You may know what they say to you, but take it a step further. Try to visualize what life is like from his or her perspectives. What are his or her priorities? Not yours. Very often, when I talk to managers, I find that they are actually projecting their own priorities into the heads of their customers. So going back to the story that I told at the beginning of this video, don't assume that your customers the person that you want him her to be, But step back to say, Who is this person, really? And how am I in a position to satisfy his or her needs in a way that my competitors can't