Understanding the market that you wish to serve is essential when it comes to running a successful business. Consumers have an unprecedented number of choices for places to shop and what to buy. To survive, retailers need an understanding of how consumers shop. Specifically, they need to know how their target demographic shops and understand the marketing implications of the consumer decision-making process.
In marketing, target demographic is a term used to define the consumer profile a business envisions when they are making products for use. Without proper outreach to the correct demographic, marketing will be useless at best and harmful to brand image at worst.
Marketing to your core demographic is the single most important thing that a marketing department will do. As a result, you need to have good, reliable consumer research to rely on. Your research is the bedrock that you base all of your marketing on and must be as accurate as possible.
Consumer research isn’t a one-time project. You must have regular check-ins with your researchers to make sure that you are on the right track with your marketing.
When consumers are buying items, they rely on two primary forms of reasoning: rational and emotional. Rational forms of reasoning can dictate why people go shopping in general. For example, if you need a new pair of shoes, you may choose to go to a mall or shopping center instead of a specific shoe store. However, the need is what prompted you to go shopping.
Rational choices are typically the catalyst for someone doing in-depth shopping. Another example is home shopping. You know your needs, but other details aren’t solidified by your logical reasoning. You, as a marketer, cannot control what the consumer feels that they need.
The rational behavior of your consumer, therefore, needs to be the starting point of your research. What prompts your customer to go shopping in the first place, and what makes them shop at your location? Knowing these things can help you make better choices than going in blind. Once you know what customers are thinking, you can then move on to what many consider to be the bulk of research in advertising.
Humans make thousands of choices every day, and many of those don’t involve any rational behavior. If a consumer is thirsty, they may not go to the nearest location for a drink, in most cases. They will go to get the item that they know they want. You cannot dictate when a customer is thirsty, but you can use marketing tactics to sway them to get a drink your beverage.
Emotional choices are as different and varied as the individuals who make them. Some of these emotional choices are based upon a quick emotional decision. These high-level emotional choices are powerful and include things like seeing an advertisement for a boot and thinking, “She looks great in those boots. I will look great in those boots.” These high-level choices are usually very basic and are made more as a spur of the moment thought.
Some consumers make choices based on a company’s values. For instance, in the United States, Chick-fil-A has donated to causes that it values. Some consumers support the company for these choices, while others feel that the company’s values violate their own.
Low-level emotional choices tend to be based upon moral values of the consumer. As a result, many companies have moved to be as transparent as possible. While this may alienate certain groups, it creates stronger brand loyalty among consumers whose values align with those of the business.
In many cases, emotional choices are more powerful than rational ones, since customers will pay more for a product if they feel better about the purchase. In the past, marketers could rely on brand loyalty, but that is no longer as large an indicator of who may purchase your products. Younger customers feel much less brand loyalty than older ones because they don’t see brand loyalty as a low-level value. Without brand loyalty, many retailers are left scrambling to increase sales.
Your job as a marketer is to know how your specific consumer demographic shops and to market directly towards their values, style and rational way of thinking. How do you, as a marketer, ensure that you are doing everything that you can to reach your customers? You first must understand how the consumer makes their choices. This requires an understanding of the consumer decision-making process model.
The consumer makes both rational and emotional choices when they are shopping, but that isn’t their entire decision-making process. To truly understand how to market, you must have a firm understanding of where your consumer’s thought process lies. Your marketing materials, therefore, should represent not just the basic steps of consumer choices, but play to your target demographic’s thought process.
Once again, the catalyst for most consumers is need — but this does not correspond to the hierarchy of needs. Instead, it is what your customer perceives as a need. What one person “needs” and another one “needs” may be completely different. For example, someone who loves cars may feel that they “need” a newer car than someone who is uninterested in the culture surrounding automobiles.
Almost all decision-making begins with the realization of a problem. As a marketer, your job is to make a consumer feel a need for your product. As mentioned above, the need doesn’t have to be an actual need for living.
People become accustomed to a certain lifestyle, and they are also creatures of extreme habit. Once a certain lifestyle has become a default, it is extremely difficult to change it. This creates the illusion of need to a consumer, and the drive to correct it is exactly the same as if they were attempting to resolve a physical need.
For a marketer, solution searching is the period of the buying process during which you want to make an impact on the consumer. Your consumer will be looking through search engines, their own shopping applications and considering things they have heard via word of mouth. They could also be looking at catalogs, print ads or billboards. Effective ads will stop a consumer in their tracks, so your ads should be designed to stop the search process and flip into an emotional thought process about your product.
Many consumers tend to look at a selection of options that they have narrowed down before they make a choice. The higher the value they perceive in an item, the more likely they are to purchase it. Customers are always looking for the best deal; however, what is a “deal” isn’t only based on money. It’s value to the consumer against the cost of the item.
When it comes to selection, the consumer has a variety of choices they can make. Once they’ve weighed the value to them against the cost, a consumer then needs to choose how they will purchase the item that they want. They will typically look for trusted sellers, either online or in physical space. Once they are certain that they have found what they want, the consumer will purchase.
During this process, the customer will be in a continual loop of evaluation. After they feel a desire or need, they will look to their social circle and their lifestyle to evaluate that need. If they have a variety of purchasing choices, they will also likely ask their circles if anyone has experience buying a similar item. While many forms of marketing and purchasing have changed, one of the most valuable assets you have in marketing remains unchanged: word of mouth.
Consumers will likely ask their network ahead of some purchases if they are new to dealing with a particular company. Every marketing expert wants to draw in lifetime customers, so this is where the focus of a good marketer turns to customer support. A bad interaction with a customer could lose you not only that customer, but customers in their sphere of influence. The opposite is also true; consumers who rave about a brand or experience can draw more customers to your company.
Once you know how consumers make choices, how does that apply to your marketing efforts? The answer is multifaceted. You need to know how your core demographic makes these choices, not the general process that consumers go through. The most effective answer to your questions involves marketing research.
There is a wide variety of available marketing research strategies, including:
- Online surveys
- Proctored testing
- Diary studies
- Focus groups
Online surveys are the easiest and cheapest way to get customer data quickly. To properly create a survey, you must focus on one major task at a time. You won’t get clear data if you aren’t focused on an online survey, and your questions need to be easy to read and should be able to be answered simply.
In this case, proctored testing isn’t the same as the testing done by schools. Instead, it focuses on having a researcher present while the customer is testing out a feature or product. For example, if you want to know how your online application is functioning, you should watch customers shopping on their phones.
What is most important in this scenario is the ability to get customer feedback in real-time. Encourage your participants to think aloud while they are working through whatever task you choose to give them. Your customer’s thought process is debatably more valuable to you as a marketer than how the tested application or product performs.
While much more time-consuming and intricate than either surveys or proctored testing, diary studies can be invaluable to a marketer. Your participants will either do a video daily or record specific tasks related to your product during a given timeframe. Typically a week is a reasonable request for participant time; more than that will increase your risk of drop-off significantly.
Focus groups used to be a major part of any marketing research; however, they are extremely ineffective and shouldn’t be used often. There have been numerous tests on the effectiveness of focus groups. One such test used a pair of jeans as the item being discussed. The researcher brought out a pair of jeans and asked for them to be passed around and checked out, and then the participants were invited to discuss.
After they had finished with the first pair of jeans, the researcher took the pants out of the room, waited a bit and then returned with the same pair of jeans. Almost immediately, it became apparent that at least one participant knew that they were the same pair, but they didn’t vocalize that opinion because everyone else was agreeing with either the first or the most self-assured participant.
Focus groups also tend to skew in the way that a company "wants” them to. This isn’t true research because of the confirmation bias. To get a true understanding of how to study consumers, you must talk to them individually to avoid the cult of personality.