Abstract Graves Enterprises is a maker of consumer and commercial grade floor care products. The new vice president for Graves Enterprises is responsible for doubling sales in both the consumer and commercial markets within the next year. The new findings of an extensive research suggested that the target market is homeowners, females 29-59, with a household income of $75-$150K. Consumers and businesses use defined processes for making purchasing decisions. They are two different markets with different processes for making purchasing decisions. Within the business world, the decision-making process—unlike that of the consumer—is marked by the inclusion of many people” (Weekly Lecture, 2009, p. 3). This paper analyzes the summary created by the marketing directors of Graves Enterprises which covers the consumer purchasing behavior and business purchasing behavior as it relates to their perspective markets. You Decide Consumer Behavior Knowing what you do about consumer behavior and purchase patterns, as shared in our Kotler text, what are your thoughts about the Consumer Products Proposal? Will it work?
Why or why not? It is important for Graves Enterprises to determine the wants and needs of the consumer market. Graves conducted primary and secondary research to determine the wants and needs of the targeted consumer market in hopes of doubling sales in the market. This is a new product line that is vulnerable without proper research. “Many new products that are launched each year fail miserably” (Weekly Lecture, 2009, p. 3). The comprehensive market research performed by the marketing director has hopefully provided enough insight to avoid costly mistakes later.
In looking at the report, the new pricing of the new product line, which is promoted as safe, effective, and eco-friendly, is probably much more than the consumer is willing to pay and may not work. An intervening factor in the consumer’s decision to purchase the eco-friendly product is the unanticipated situational factor. Pricing the product at 1. 5X the price could be perceived as a financial risk. Consumers will not purchase the product if it is deemed too expensive. In the information search, the consumer will probably look at the fact that the product is safe, effective, nd eco-friendly but pricey and in evaluating the alternatives will find a competitive product that has the same features but less pricey. What additional consumer recommendations would you make? Conducting further research on how important an eco-friendly product is to the targeted market would be beneficial. “It’s estimated that 80% of new products introduced each year fail—often, this is due to a lack of a full understanding of what consumers really want.. and for what they’re willing to pay” (Weekly Lecture, 2009, p. 3).
For that reason, Graves’ targeted market may or may not see the value in purchasing a 1. 5X floor care product when they can get the same product at a cheaper price. Business Behavior Knowing what you do about business purchasing and decision making processes within a business organization, as shared in our Kotler text, what are your thoughts about the Commercial Products Proposal? Will it work? Why or why not? Graves Enterprises conducted extensive research and determined that their current market leadership positions in their current business market are safe.
The commercial market base is much smaller but has great purchasing power; therefore, Graves must make sure that the product is customized for the market of schools, retail and office buildings. The market is secure with the current price; however, increasing the price two times the current price could disrupt the company’s security and in the end may not work. There is an added feature of a full antibacterial product line but it may not be enough to retain the current market with an increased price. What additional recommendations would you make to further grow the commercial side of the business?
In the commercial side of business, there are many people involved in the decision making process. “Buying centers usually include several participants with different interests, authority, status, and persuasiveness and sometimes very different decision criteria” (Kotler & Keller, 2009, p. 188). Sales representatives will have to be very involved in selling the new product to Graves’ current market; therefore, retaining the current market and acquiring new markets thus growing the business. Consumer and Business Behavior Thoughts
Having completed this exercise, what did you personally learn about Consumer Behavior that you did not previously know? Consumer behavior is very complex and it does not matter whether the product is high-end or low-end. If a consumer perceives a purchase as a risk then it affects the decision to purchase the product. Having completed this exercise, what did you personally learn about Business Behavior that you did not previously know? Purchase decisions in the business market are made by several people and committees.
There are special departments that are trained to make purchases for companies and the purchase decisions are not made lightly. Summary Considering this YOU DECIDE activity, what primary concept relative to purchasing behavior was the exercise trying to demonstrate? The exercise was trying to demonstrate the process that consumers and businesses use to make purchasing decisions and how each market reacts to new products. References Kotler, P. , Keller, K. L. (2009) Marketing Management. Thirteenth Edition. Prentice Hall Weekly Lecture (2009) Beginning the Journey…Lecture