Stages of Customer Buying Behavior - Essay Example

?Question Stages Buying Behavior There are mainly six stages buying process which a faces throughout his/her buying process. The major revenue source of Facebook is the Banner Ads that are used by the companies to advertise their products. Therefore, the main customers of Facebook are the companies which use Facebook as a platform for their marketing campaign. The following analysis highlights the whole customer buying process in terms of those companies which act as customers of Facebook. Problem Recognition In this step, the companies try to find how they should market themselves. What platform should be used by them in order to market their products and services more effectively covering huge masses all around the globe? The companies also aim to find such marketing tools which are personal and closer to their customers’ needs and preferences. Information Search This step involves the searching phase in order to obtain the latest information regarding the most effective personal marketing tool. Different tools are used by the companies to advertise themselves. TV and commercial ads are considered as one way marketing in which the customer’s feedback cannot be obtained. In this way, the current trend of bidirectional marketing is on its move such that most of the companies are using social networking sites for this purpose. These companies not only post their marketing messages through the banner ads but also create their communities to interact with their customers, and other fans of their products. Evaluation of Alternatives After the gathering of information regarding the social network sites, the next step is to evaluate these sites as to which site fulfill the advertising requirement of those companies. Social networking sites including Facebook, twitter, MySpace etc are the most popular sites which are mostly used by the companies to advertise themselves. Facebook charges the most for the banner ads because it provides more personal and appealing marketing interface to its customers i.e. companies who wish to advertise. Buying Decision Buying decision is the next step in customer buying process. In this step customer actually decides as which option is the best one to utilize which can ultimately fulfill the marketing requirements of the company and provide a more populated customer base to attract. In this way, these companies tend to focus more towards Facebook as Facebook has the most number of active users as compared to other social networking sites. Buying This step is the actual buying activity in which these companies pay the Facebook for their banner ads to be put in to the Facebook pages. Facebook provides those companies a unique offer such that these companies can target their customers who are within the geographical and demographic boundaries of those companies. For instance, Facebook ensures that only those users should watch those banner ads which are used to target them by these companies rather than posting those banners on the profiles of those users who cannot be catered by those companies by any means. Post Buying Decision In the post buying stage, these advertising companies keep evaluating as what actually is feedback of the customers who being attracted by the Facebook platform. These evaluations can be performed by the activities of the users on the community pages created by these companies. Customer’s feedbacks and likings would certainly lead to the judgment as how effectively the marketing messages are conveyed to the customers as a primary basis. Increase in sales and revenue growth of these companies, would eventually conform the expectations of these companies as to what extent the companies remained successful in terms of their marketing efforts. Factors affecting Facebook Customers External Factors Four external forces can influence Facebook customers might be: 1. Government interventions in respect of utilizing Facebook as a medium of marketing tool 2. Emergence of other better social networking site with more enhanced features and cost effective packages 3. Technological and network based issues in some countries due to which facebook customers might become reluctant in using facebook’s advertising platform. 4. Issues raised by social and religious groups based on rumors or other factors in order not to use Facebook as a medium of advertising. Internal Factors Four internal forces that can influence Facebook customers might be: 1. Change in the features of facebook outlook 2. Change in the advertising packages offered by Facebook to its customers 3. Change in the activity level of Facebook users 4. Change in the Facebook’s policies especially relating to its customers and users. Question 2: Marketing Promotional Mix Marketing Promotional Mix utilizes the effective marketing communication tools may have the following forms. Some of these forms include Advertising, Personal Selling, Direct Marketing, Sponsorship, Public Relations and Sales Promotion etc The following discussion highlights three of these marketing communication tools which include Advertising, Public Relations and Sales Promotion. Advertising Advertising is the primary activity of marketing to attract the customers. The advertising mainly contain different forms including TV and radio ads, billboards, ads on newspapers, magazines, journals, websites etc. Some of the characteristics of creating good advertisement include high level targeting of the potential customers, tend to solve a problem, catchy and unique in their style and communication, and stimulate the audience to act towards the message of the advertisement. The major features of the advertising include wide coverage of target audience, repetition of the message, control over the message of advertisement, builds strong brand loyalty. The effectiveness of advertising can be measured by distinct metrics including the customer’s feedback, inquiries, returning to the products and services; purchase repetition, sales growth etc. Facebook provides a well established platform for companies to use its banner ads as the highly popular medium of advertisement. Despite of being an expensive medium, yet it fulfills the requirements of its customers with its unique offerings. Banner ads are used by these companies to advertise their marketing messages to those potential customers, who can be targeted by those companies on geographical and demographic basis. For example, a company wants to advertise its marketing message to a certain class of audience, the automatic features of those banner ads will direct those banner ads messages only to those potential customers who are intended by the company to target. Public Relations One of the core reasons of marketing communication is to create excellent public relations with its potential customers. The quality of public relations shapes up the organization’s efforts towards achieving its marketing goals. Public relations are of utmost importance in defining the relationship between an organization and its surrounding stakeholders which include customer, suppliers, shareholder, employees, government, media and other organizations. The characteristics of public relations lead towards the effective marketing campaign of any organization. The major characteristic is that these public relations are the established without even paying for anything in a direct form. It can be called as unpaid publicity. The main feature of maintaining public relation is that the publicity of the organization is made by the third party through event organization, symposium etc. Effectiveness of Public Relations can be measured by the increasing customer base, more number of inquiries regarding organization’s event or public dealings, the interest of public in attending the seminars and workshops arranged by the organization etc. Facebook is the best platform to maintain the public relations as it offers the companies to create the communities through which they can interact with their fans, customer and other followers. The promising feature of this platform is that it is free of charge. In this way, these companies can create a community which describes the overall outlook of the company, information about the products and services being offered, customers’ feedback and many other interactive features. Sales Promotion Sales Promotion is also one of the effective advertising tools in the marketing campaigns of the organization. This tool is used by the companies to increase the short term sales of the company by providing incentives to the customers in the form of discounts, gifts, extra usage, free delivery etc. The major characteristics of Sales Promotion are the communication, incentives and the invitation towards the products and services offered by the organization. The features of sales promotion include the price discrimination in different areas of the same product according to the demand of that product, the response to varied buying behavior and the regional difference in the geographical background of the customers. The effectiveness of sales promotion can be achieved by appropriately targeting the efforts in attracting the customers, planning the incentives to be provided to the customer and finally, the ultimate objective of the sales promotion in terms of what the organization wants to achieve with the sales promotion. Sales Promotion strategies are being used by the companies which use Facebook as one of their marketing medium. Promotional banner ads along with information of different promotional schemes through community pages on Facebook are widely used for this purpose. Question 3: Elements of Communication Process Noise Sender Encoding Message Media Decoding Receiver Feedback Distortion Following are the nine elements which are used in the effective communication process. The example of Facebook’s communication is illustrated in the given process. Sender The customers and users of Facebook are the originator of any message. Encoding Once the users recognize as what to communicate through facebook, they start encoding those ideas into words, i.e. encoding. Message After the words are framed in a proper manner, the content of message is formulated. Media After the message is created by the users and customers, they decide the medium of sending the message. Facebook in this way, act as the medium of exchange of views, information, ideas and messages. Noise In the context of facebook, the noise may bring hurdles to this communication process such as website maintenance, issues in network connections etc may hinder the process of effective communication through facebook. Distortion Distortion refers to the way in which the essence of the meaning of the message is lost during the communication process. In Facebook context, often it happens that messages are distorted due to information overload, jumping to the conclusion of the message at the initial stage, snap judgment and perceptual biasness etc. Decoding Decoding refers to the activity in which the content of the message is understood by the person at the receiving end. Messages or status updates running on news feeds of Facebook are the messages that are decoded by the customers and users. Receiver Ultimately, the receivers are the people to whom the message is intended to be sent. Feedback Feedback is the reaction of the receivers as how they get back to those messages. They may either reply on the facebook messages, or ignore them, or store them for future retrieval. All of these responses lie at the discretion of the facebook users and customers. Limitations – Global Marketing Strategy Facebook marketing department should be aware of the following limitations when deciding the global marketing strategy. 1. Facebook do not have the control over the governments around the world. They might deactivate the website browsing in their jurisdictions for any reason. 2. Facebook do not have the control over the activities of its competing social networking sites. 3. Facebook cannot offer everything for its customer for free of cost. 4. Facebook cannot charge from its users. If it did so, it would lose substantial amount of revenues that it generates from the advertising banner ads. Barriers– Global Marketing Strategy The following are the barriers that might hinder the activities of marketing department of facebook: 1. Since Facebook is not a publicly owned entity yet, therefore lack of funds is still a barrier in expanding more applications and operations. 2. There are still many untapped markets where facebook is still in its initial stage and substantial amount of revenues is still missing by the Facebook. 3. Facebook should consider the fact that many social and religious groups are not in favor of facebook’s expansion, therefore more focus should be given on this issue and the marketing department should formulate policies to harmonize the thoughts of different groups. Question 4: Comparison of the characteristics and benefits of qualitative and quantitative research methods Qualitative Research Qualitative research incorporates gathering data through pictures, videos, words, interviews, artifacts or objects. In this type of research, interpretation of events is substantial. For instance, in detail interviews, participant observation etc. Qualitative research is more time consuming and rich. There are lesser chances to generalize the results which are generated through qualitative research. Gathered results are interpreted in generalized and subjective manner, at times they can also be diagnosed. Objective of Qualitative Research The primary aim of the qualitative research is to provide detailed and complete description of topic on which research is to be conducted. Qualitative research is more suitable for the initial part of research project. Modes of Data Collection The data for qualitative research are gathered through different instruments. Usually, primary data is gathered in order to conduct qualitative research. For this, the researcher has to employ various techniques for data collection. Examples include non-structured or structured interviews, detailed interviews, narratives, focus groups, participant observation, questionnaire, documentary or content analysis and archival research. Quantitative Data Quantitative research primarily focuses on classifying features, counting or numerical analysis of data. Quantitative research integrates constructing econometrical or statistical modeling as well as figures and numbers to explain or interpret the results. Methods of Data Collection In order to acquire data for quantitative research, various techniques are employed. It can be done through surveys, questionnaires and other instruments to collect measurable or numerical data. Usually, secondary data is utilized for conducting quantitative research which means the data which is already available through different sources. Facebook – Benefits of Research Methods Facebook incorporates quantitative as well as qualitative research. It has appointed several researchers who conduct research related for each country regarding the demographics, psychographics and behavioral basis in order to attract related products and features for them. Qualitative and quantitative, both the research methods can benefit facebook as the available opportunities for facebook are unlimited. It can conduct more research regarding each area for market penetration. It has already reached its saturation point but a lot more is still to come as it is continually integrating and adopting new and latest features and interface in order to hold the interest of its users. a) Include a diagram of Continuum Research technique. Behavioral Usability Studies Data mining Data Source Phone Focus Groups E-mail Surveys Attitudinal Detailed Interviews Surveys Qualitative Approach Quantitative Question 5: AIDA as a Promotional Mix for Facebook AIDA model consist of four basic elements which are: Awareness/ Attention Interest Desire Action Each element is crucial in developing an effective promotional mix. Facebook has been utilizing this model very efficiently which is the major driver of its success. AIDA model in facebook represent the awareness of facebook to every other person nowadays. Whether a person uses or owns a facebook account or not, he or she is most likely to be aware of what exactly it is. Almost every other person is highly interested in using facebook due to the number of activities it offer. Therefore the second stage is also done effectively by facebook. Mostly people have fulfilled their desire by activating their accounts. The fulfillment of desire in AIDA model leads to final stage which is the Action step. Each of these steps must be strategically designed in order to have a better promotional mix. Awareness For social media network, awareness works as bread and butter. The basic purpose of the development of facebook is awareness. There are many businesspersons who are making people aware of their business through facebook. Awareness can take numerous from because it let people know that you exist. Facebook, itself, doesn’t require any awareness because 9 out of every 10 person is aware of facebook somehow or other. Interest After getting attention, the second step is to gather the interest of the customer. Facebook has numerous users all over the world and nowadays people are more interested in facebook than ever before. Benefits and features which facebook offer arouse the interest of its users. Desire The site of a company makes huge impression and normally customers judge a company by their site. Facebook has developed an attractive interface in order to provide people with the desire of having their own account on it. Facebook has taken its users from interest to desire stage in a rich, clean and easy to navigate way. Action After the users have the desire, there are now mentally ready to use your product. That stage is called as Action. Millions of people have activated their account and millions of businesses are being run on facebook. In action stage, facebook users are satisfied by the interest and desire stage because it provides with an attractive experience of using facebook. References Changing Minds, n.d. AIDA. [Online] Available at: http://changingminds.org/disciplines/sales/methods/aida.htm [Accessed 15 February 2012] Evans, Liana, 2011. 10 Research Tools for Social Media Strategies. [Online] (23 February) Available at: http://www.clickz.com/clickz/column/2028067/research-tools-social-media-strategies [Accessed 15 February 2012] Neill, James, 2007. Qualitative versus Quantitative Research: Key Points in a Classic Debate. [Online] (28 February) Available at: http://wilderdom.com/research/QualitativeVersusQuantitativeResearch.html [Accessed 15 February 2012] Peters, Josh, 2010. HOW TO: Optimize Your Social Media Marketing Strategy. [Online] (27 October) Available at: http://mashable.com/2010/10/27/optimize-social-media-marketing/ [Accessed 15 February 2012] Public Relation (PR), n.d. Public relations as part of the marketing communications mix Product placement in media. 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