The success in improving sales volumes largely relies on the ability of the sales department to accurately analyze the main drivers of customer behavior. Different products are affected by various factors determining sales to a varying degree. The quality, price, and supply quantities are however universal determinants of sales in all products (Marketing Teacher, 2009, Para 4).
This paper analyses the behavior of consumers and businesses in a case involving Graves Enterprises, a manufacturer of consumer and commercial grade floor care products.
The Consumer Products Proposal emphasizes promoting the eco-friendly element of the products. The price is to be hiked by 50% above current prices. It also proposes diversification by introducing extra products. Finally, it suggests the expansion into other retail lines. Some of these proposals are not feasible. Market survey shows price is the most important influence on the choice behavior by consumers. Eco-friendliness was the least important attribute. In this regard the suggestion to increase prices and ensure eco-friendliness is wrong. This will not work to improve sales but may even reduce volumes sold due to the sensitivity or elasticity of the products to price changes. According to research price remains the most powerful influence on buyer behavior. This being the case, a 50% price hike cannot lead to good sales. The focus should be on how to reduce prices to improve competitiveness (Brown, 2008, Para3).
The commercial products proposal seeks the introduction of a full antibacterial product line for schools and hospitals and the repackaging of anti-skid wax for sale to hospitals and nursing homes. The new product line is to be charged twice the price of current products. The proposal to introduce the new products at twice the price of current products will not work. This is because hospitals and nursing homes also considered price as the key purchasing decision. The high prices are likely to put off buyers despite the extra features.
In growing the commercial side of the business, the focus should shift from increasing prices to decreasing them to beat the competition. An advertising campaign spelling out the unique features of the company’s products should be undertaken. The mold reduction aspect, as well as the “Scotchgard” for continued stain protection, can be very powerful selling points especially in trying to position the products as being superior to those offered by competitors. This will best influence the minds of consumers. The company should move aggressively towards the healthcare industry as it remains untapped (Kotler, and Keller, 2009, pp42).
In completing this exercise, the writer learned that consumer behavior has not really changed with the introduction of the environmental friendliness aspect in the modern-day market. Despite the numerous awareness campaigns, consumers are still not willing to pay higher for eco-friendly products. Price sensitivity remains high despite other possible benefits that the products may be offering.
The writer also learned that the main determinant of business behavior is the cost-cutting element. Despite their unique nature and the need to adopt the best hygiene, hospitals and nursing homes remained highly sensitive to price changes in cleaning products. This is a new reaffirming of the prominent position of costs in influencing business behavior.
What seems to be most sensible may not necessarily be effective in influencing consumer behavior. Thorough research and analysis should regularly be undertaken to ensure the accuracy of decisions made.
Reference
Marketing Teacher, (2009). Consumer Buyer Behavior. Web.
Kotler, P., and Keller, L., (2009). Marketing Management. Pearson Education, Pearson Prentice Hall.
Brown A., (2008). Consumer Buying Behavior. Web.