Background
This report elaborates consumer purchase behavior issue related to Blackberry Smartphone. The report seeks to ascertain the best marketing strategy that can fit the consumer behavior in the Smartphone industry.
Store Selection
Blackberry Smartphone store
Market Segmentation
The market for Smartphone should be segmented based upon the individuals’ purchasing power and the age bracket. The products should be designed to match the needs of the respective market segment. For example, the phones designed for the youth population should include interactive applications that facilitate sharing, message sending, reading of documents, access to internet and sending photos.
On the other hand, the designs for professionals should have email functionalities, QWERTY keyboard and additional business features. Users must be provided with innovative technology in addition to style. These features will provide memorable experience and promote the demand for the products.
Product Positioning
The Blackberry Smartphone devices are positioned on grounds of quality, as a company, RIM offers high quality products that are not only user friendly but also offer competitive prices to both business and personal users. The company enjoys significant competitive advantages given the global presence of its stores.
Variables under Study
A number of internal and external variables that affect Blackberry consumer behavior will be analyzed. External factors include demographic characteristics, reference groups, social status, and family. Internal variables on the other hand include personality, learning, self-concept, learning, memory, and motives.
Analysis of the Consumer Decision Process
Description of the External Variables
Demographics
The demographics of its current market indicates that it targets majorly the middle to upper income individuals aged from 30 to 35 and working in business and managerial sectors. The mainstream consumer market presents significant opportunities that the company can tap into.
The company can join this market segment through bringing in and integrating changes from the consumers’ point of view. The additional features that the company has introduced in its smart devices that include applications like Twitter and Facebook in addition to multimedia functionalities will attract the youth segment of the population including students and appeal to their interactive lifestyles.
The company should focus its marketing attention on the young generation who are well acquainted with social media, technology and can influence the consumption patterns of their parents.
Social Status
The demographics for this population are individuals who belong to the lower to the upper middle class. To this segment, ownership of a blackberry device is a symbol of status. They make use of these devices not only to communicate, but also to send emails, receive email notifications, and chat with friends.
Culture
The product targets all cultures because unlike other products, the use of smart devices is not strongly affected by culture. The product is used by individuals across all cultures.
Reference Groups
Many of the individuals falling within the 30-35 age brackets are workers in the middle of the careers. Their purchase decisions are mainly influenced by the opinions of the family members, friends, and peers.
They are equally influenced by the purchase decisions made by their closest friends and peers, who refer them to the specific stores where they bought their blackberry devices. The group also seeks information from the internet and social media before making purchase decisions.
Description of Internal Variables
Consumer Personality: the personality of the consumer especially that of the middle class has a significant influence on the purchase decisions.
Individual perceptions: a personal view of thins is very important as it dictates how this population segment interpret the appearance and feel of the products.
Learning: this population segment can be best explained by cognitive theory of learning. They learn through observation by seeing the purchase decisions made by their closest friends, family members, co-workers, and peers. This in turn influences how they behave.
Motives: consumer motives for purchasing a Smartphone (blackberry) arise mainly due to the need for self-actualization. Other motives include the type of customer service extended and the availability of after sales services.
Memory: past experience on the exemplary quality of the device influences the customer purchase decision. The attractiveness of the stores in addition to ease of navigating through the stores are equally important determinants of purchase decisions.
Statement of the Consumer Behavior Issue
Consumers are often confronted with the need to make purchase decisions on products and services almost on a daily basis. Some of these decisions are of utmost importance to consumers and involve great effort, while others are made based on impulse.
The view points on decision making vary from focus on habits that an individual develops to a focus on fresh events that involve a high degree of risk where buyers have to carefully gather and assess information before making choices (Papaoikonomou, Ryan & Ginieis, 2011). Consumer behavior issue for this project is ‘how do consumers make Smartphone purchase decisions.
The topic is of importance because individuals no longer base their purchase decisions on a phone’s functions and features alone. Every year, Smartphones’ sales increase at a faster rate. It is important to understand Smartphones’ sales drivers.
Previously, buyers focused on phones that were well designed and contained latest technology features such as GPS, Wi-Fi and high-resolution camera. However, today, the development of mobile hardware has been accorded secondary importance. Today, greater focus is on the experience that Smartphone offers, the possibilities that it makes possible and the specific needs that they meet (Zarantonello & Schmitt, 2010).
According to GFK Custom Research (2012), approximately 37 percent of individuals who own mobile phones in key global markets intent to upgrade to a Smartphone in their subsequent upgrade cycle. Similarly, a large percentage of individuals who use Smartphones (56 percent) express preference to a particular brand and very few of them have declared loyalty to their current Smartphone brand.
Methodology Employed
The project will adopt primary research methods specifically surveys. Approximately five students who identify themselves as Blackberry (RIM) users will be requested to complete a survey. The questions will be about their Smartphone preferences and it will take approximately 5 to 8 minutes to complete the survey.
Participation will be on voluntary basis and all respondents are requested to disclose as much information as possible. The responses gathered from the survey will be treated as confidential and all data will be reported in aggregate and not individually.
Analysis of Consumer Behavior Using Theory Concepts
In making a decision on whether to purchase a Blackberry Smartphone or not, consumers undergo a number of processes that include recognizing the problem before a consumer buys a Smartphone, he or she first realizes that there is a need which the phone will satisfy (Court, Elzinga, Mulder & Vetvik, 2009).
It is because of this that the consumer identifies a specific brand (Blackberry) for which s/he has developed an emotional attachment and s/he believes the phone can meet the needs identified. Because of this, people have different brand preferences for Smartphones namely: Apples, Blackberry, Windows Mobile, Nokia Symbian and Android.
Once a customer has developed a brand preference based on the need s/he believes the brand satisfies, it becomes very difficult for a competitor to gain his or her patronage. In making a Smartphone purchase decision, a number of factors will influence the individuals decision.
These include the brand performance of the Smartphone, availability of the product, personal emotions, normal depletion and individual development.
Information search; once the need for the Smartphone has been identified, the consumer embarks on the search for information. This is done both internally and externally to get a product that can address the identified need on an ongoing process.
The Smartphone customers develop relevant criteria for solving the problem. As information search advances, external information search tends to gain more importance. Market features that influence the choice of the product include: the Smartphones price, availability and distribution of the companys stores, available substitutes and price.
Product features for example, the level of differentiation and the price have a significant influence on the external search for information.
Evaluating the choices and selecting an alternative after gathering sufficient information about the available Smartphones that can meet the identified need, an evaluation of the various brands (Apples, Blackberry, Windows Mobile, Nokia Symbian and Android) is done and the on e best fit to address the need is selected.
A consumer evaluates the products based upon the features that can best respond to his problem and the criteria differs from one consumer to the other. Smartphone consumers base their decision criteria on the quality of the device, the price, the incentives, and the applications it supports.
Smartphone selection and purchase; the selection criteria that the consumers employ in selecting a brand is almost the same with the one they use in selecting the retail outlet. For many Smartphone buyers, the manner in which the products are displayed (store image), the type and volume of retail advertising significantly influences the evaluation criteria adopted by the customer.
Store image does not only include the display of the Smartphones but also the service delivered, merchandise, physical facilities, level of convenience, store atmosphere, promotional campaigns and the number of clientele. Smartphone consumes tend to exhibit a shopping orientation which is the approach the consumer adopts in acquiring both the non-purchase satisfaction and brand preference in different retail outlets.
In some cases, consumers may end up purchasing a Smartphone brand when in fact they did not have that plan in mind before they entered the store. This is called impulse purchase and this can be the result of the customer processing additional information induced by in store attractiveness. With the brand and the specific outlet in mind, a consumer makes a purchase of the Smartphone device.
After purchase process, it is a common experience that after making some purchases, consumers tend to question the wisdom behind the purchase. Whether or not the consumer experiences dissatisfaction with the product, the purchase of the Smartphone will most definitely be followed by use to fulfill the need identified in the first stage (Keinan & Kivetz, 2008).
However, a negative evaluation may result from the use. It is at this stage that the marketing aspects become more relevant. Through a consistent follow up on how consumers make use of the product, the company can device new methods of using their current products, they can develop catchy advertisements, create demand for new products, and change their existing products to conform to the customer requirements.
Some consumers of Smartphone devices may not be satisfied with the devices and they may end up disposing them. When a product fails to meet the expectations of the consumer post-purchase, dissatisfaction follows and this will have a significant influence on how the individual evaluates his next purchase process.
Because of this, they may decide to take no action at all, switch between stores, brands or products or warn their friends about the demerits of the product. These represent the effects of a negative purchase evaluation process. Some companies offer companies some level of repurchase motivation following a negative evaluation process.
Recommendations for Marketing Actions Based on Analysis
Need for Change in the Marketing Strategy
Price; a company that offers the most competitive prices in the market can capture a significant portion of the current market share especially during the hard economic times. If the prices of Smartphones can be set based upon the pricing strategies pursued by the competitors, consumers can benefit immensely.
Place; as noted earlier in the analysis one of the factors that determine the type of a Smartphone brand that consumers purchase is the availability of the product. Because of this, Smartphone companies must expand their regional, national and global presence.
Promotion; product promotions influence the demand for Smartphone devices. For companies in the industry to capture the market and convince consumers with their innovative technologies, they must explore modern ways of promoting the products to the mainstream consumer segment (Lee & Liqiang, 2010).
The new marketing styles should be formulated in a manner that attracts the younger generation by promoting interactive lifestyle applications.
Product; to effectively market the products and attract the masses, phones must have detailed features and trendy. Phones should have enhanced capabilities that include functions like multimedia capabilities and redesigning the phones to attract the consumers and capture substantial market share.
Penetrating the Market
Producers of Smartphones must focus on boosting their share in the Smartphone industry at both consumer and enterprise levels. The marketing team must formulate strategies aimed at creating and increasing brand awareness by selling the benefits of the brand. In the same way, firms should improve their delivery efforts and launch more service stations. This will provide them with an upper hand in entering new markets and capturing the market share.
Application of the Recommendations to Blackberry
From the above analysis, it is clear that Smartphone is a global leader in the cell phone device industry. Companies like Research in Motion (RIM) should redefine their target market from the traditional focus on business users to include even student customers. By redefining its target market, the company can easily increase its revenues.
To achieve revenue expansion, the company must undertake a number of marketing initiatives that include repositioning itself to cater for the diverse needs of the consumers. The company needs to produce lower-end phones but with similar capabilities like the high-end Blackberry Storm that will appeal to the younger population more so students.
Smartphones are associated with business professionals who need to communicate quickly regardless of whether they are on the move or in the office. However, given the increased popularity of smart devices and a decline in the price of mobile technology, Smartphone companies have been forced to expand their product lines to include features such as communication, data transfer and entertainment.
These companies must move ahead and market the aesthetic aspects of the phones as an integral component of selling the Smartphones. In addition, the number of applications that a Smartphone has dictates its sales market boundaries.
References
Court, D., Elzinga, D., Mulder, S. & Vetvik, O. (2009). The consumer decision journey. McKinsey Quarterly, (3), 96-107.
Gfk Custom Research. (2010). The Smartphone market is there to be won. Web.
Keinan, A. & Kivetz, R. (2008). Remedying Hyperopia: The Effects of Self-Control Regret on Consumer Behavior. Journal of Marketing Research (JMR), 45(6), 676-689.
Lee, S. M. & Liqiang, C. (2010). The Impact of Flow on Online Consumer Behavior. Journal of Computer Information Systems, 50(4), 1-10.
Papaoikonomou, E., Ryan, G. & Ginieis, M. (2011). Towards a Holistic Approach of the Attitude Behaviour Gap in Ethical Consumer Behaviours: Empirical Evidence from Spain. International Advances in Economic Research, 17(1), 77-88.
Zarantonello, L. & Schmitt, B. H. (2010). Using the brand experience scale to profile consumers and predict consumer behavior. Journal of Brand Management, 17(7), 532-540.