Influences

Untitled Slide

• needs vs wants
• advertising
• making buying desions

NEEDS

disposable income
(or net income)

is money you have to spend after taxes are taken out of your paycheck
--take home pay--

wants

customers
vs
consumers

customers

CONSUMERS

spenders

• big spenders > blow all their $$$
• penny pinchers > save all their $$$
• Which spends more $$$ on wants?

discretionary income

is money spent after necesseties
have been paid for
(luxury items)

BREAKING THE CYCLE

break the cycle

• take the emotion out of spending
• think about your values (not adverts)
• learn to draw a line btwn needs/wants

DECIDING TO BUY

comparison shopping

• what brand to buy
• where to buy it
• buy now vs later

consider a product's:
cost, quality, and features compared to others similar products

is the most expensive brand worth the extra price; is it better quality; will it last longer

spending chart

• create a budget
• track income and spending

opportunity costs

• what you give up to purchase an item
• a trade-off

ADVERTISING

BRANDs

• generic > no brand, just product
• consider many generic products are
• made by the large manufacturers
• in other words, there's no difference

BRANDS

brand name > identifies a product or a manufacturer

brand names only matter if you let them, does not always mean product quality is better

logo > symbol that defines a product/company

ad agencies

• hired to promote brands, persuade
• the ave. teen sees 3000-5000 ads a day
• many companies spend maj. of budget on this
• sometimes referred to as "Madison Avenue"

ADVERTISEMENTS

advertisements

• determine/research a target market

research a target market

• what's their perception of N/W
• what problems are you trying to solve
• what emotions do they experience
• what is their current/desired lifestyle

advertisements

• determine/research a target market
• grab the attention of the audience

get their attention

• use emotion to appeal to senses
• show how to save money
• make promises of a better life
• solve their problems

advertisements

• determine/research a target market
• grab the attention of the audience
• make your brand stand out

make your brand stand out

• describe the product's benefits
• show it's unique features
• illustrate value & quality
• create a memorable ad

advertisements

• determine/research a target market
• grab the attention of the audience
• make your brand stand out
• change the consumers' brand habits

CHANGE THE CONSUMER'S BRAND PREFERENCES

if the consumer will switch and buy the advertised brand instead of the competition's, then the advertiser has done their job

strategy: beauty appeal

• we are drawn to beauty
• using a product will make you:
• more popular
• better looking

strategy: bandwagon

• buy the product like everyone else

strategy: celebrity

• associate the product with a celeb
• actor, athlete, musician, etc.
• celeb may influence you to buy it

strategy: emotional appeal

• product will make you feel better
• happier, confident, loved, etc.
• make you feel guilty if you don't buy

strategy: catchiness

• slogan
• jingle
• humor
• gets stuck in your head

STRATEGY: PRODUCT PLACEMENT

• use a product/brand in pop media
• tv, movie, games, etc.

strategy: retail sensory

• environmental stimulus
• appeal to your subconscious
• sound, visuals, scents
• make you stay longer, spend more

strategy: gotta have it now

• try to convince you NEED to buy it NOW
• use "limited time" promotions/incentives

strategy: target youth

• youth: pay attention to trends
• youth: spend a lot/influence spending
• youth: can become a life-long buyer

Targeting youth

• social network marketing
• schools: channel one, vending machines
• start em' young, product tie-ins
• advergaming

ftc

regulating adverts

• FTC > federal trade commission
• regulate marketing activities
• protect consumers
• false adverts, misleading prices,
• deceptive packaging/labels

if a consumer feels an advertisement is false, it can reported to the FTC

1. FTC issues a complaint
2. if the company continues, they are fined up to $10,000 a day
3. the company must correct the ad

MAKING BUYING DECISIONS

making decisions

• gather info
• comparison shop
• check the warranty
• consult with others

comparison shopping

• understand your choices > where to buy
• BIG BOX
• MOM & POP
• ONLINE

BIG BOX STORES

• national chain
• usually cheaper (bought in bulk)
• examples?

mom & pop stores

• more local, independent
• can offer personalized services
• examples?

online stores

• maybe a better price
• offers convenience
• makes comparison shopping easier
• might have to pay shipping
• can't touch merchandise

warranties

warranties

• does the brand offer one
• how long does it last
• is there an extended warranty
• does the store do its own repairs

CONSULTING OTHERS

consulting others

• talk with others about their experiences
• use sources like "Consumer Reports"-unbiased
• read online reviews of products