Marketing behavioral psychology

The history of the marketing approach

Marketing Vs Behavioral Psychology Marketing, as a thoughtful, structured approach, originated in the United States after the terrible financial crisis of 1929, which revealed the need for better consideration and integration of the way the market operates in its entirety.

After the Second World War, modern means of mass production combined with the development and emergence of new markets gave rise to mass marketing, whose raison d’être came down to supply.

Consumer society

This new stage in the development of marketing as an economic discipline was a response to the new needs of what is still known today as the “consumer society”. From now on, the aim of marketing is to help companies sell products that are as standardized as possible to the widest possible customer base.

This supply-side marketing, thanks in particular to the phenomenon of economies of scale, will greatly help to improve company productivity at all levels, and consequently increase profitability.

Reaction to the economic crisis

Then, in response to the economic crisis that hit most industrialized countries from the mid-70s onwards, the marketing approach shifted to focus on the customer, and proposed a new strategy: segmentation.

Economic difficulties will encourage companies to analyze and better anticipate developments in their business sector, for example by setting up their first market surveys.

With competition intensifying under the aegis of policies now favoring free trade, companies are focusing on differentiating their commercial offering in order to better meet consumer expectations and demands. It’s fair to say that mass marketing was in its heyday.

In the early 1980s, the customer was at the heart of the marketing approach, and satisfying consumer needs was considered the priority.

Targeted offers begin

Companies are starting to offer targeted products to coherent groups of consumers, known as “segments”. These highly homogeneous groups share common traits in terms of behavior and needs.

This trend towards singling out individual consumers continued in the 90s with the emergence of an increasingly individualized approach to marketing, driven by technological progress – the emergence of the Internet and e-commerce, in particular – and increasingly fierce commercial competition.

As a result, companies will begin to perceive each customer as a strategic asset and personalize their offer even more. The notion of customer loyalty will also become a real challenge.

In response to this new situation marketing specialists will develop direct sales approaches and exploit the new tools at their disposal, such as e-mailing, content marketing via blogs and websites, the use of social networks, video, targeted digital advertising, the remarketingetc.

The two facets of the marketing approach

In the modern marketing approach, there are two essential dimensions: strategic marketing and operational marketing.

1- Strategic marketing

Strategic marketing can be broken down into two stages.

The first focuses on market research and strategic intelligence. Because before you can think about developing a strategy, you first need to create the optimum conditions for implementing the marketing process for your product or service offering, which will take into account the specific features of your market.

Behavioral research marketing

Research marketing and strategic intelligence, i.e. the ongoing analysis and monitoring of your market, will enable you to gather the data and information that will later guide your strategic and operational choices.

If your business is focused on foreign markets, you’ll need to adapt your marketing approach to the specific features of your target markets, and carry out an in-depth study of the country you’re targeting, because despite the phenomenon of globalization, each foreign market has a number of specific elements that need to be taken into consideration.

Consumption patterns and buying behavior

These include cultural aspects, which influence consumption patterns and buying behavior, as well as local players and intermediaries who can help you get your product to market. Identifying the supply and demand characteristics of your target market is also a must.

Finally, it would be imprudent to neglect the regulatory aspect.

Market ecosystem

In any case, imperfect knowledge of the ecosystem of a given market, whether at home or abroad, can jeopardize your commercial success.

The second stage concerns the diagnosis you make of the results obtained in the study and analysis phase, and the resulting strategic choices.

Strategic decisions

The data gathered through market research and business intelligence should be used to identify risks and opportunities in the market in question.

Next, your company can define its strategic orientations and the methods of action that will enable it to implement a successful sales plan, obviously taking into account its own resources and mode of operation.

During this crucial phase, you will have to make a number of important strategic decisions:

• Create an optimal product-market approach, where the offer is perfectly adapted to your target clientele and takes the competition into account
• Define segments within your overall target customer base, as well as the
  positioning
  positioning of your offer
• Determine sales policies and strategies that take into account the specific characteristics of each segment and any local peculiarities if you are targeting foreign markets.

2- Operational marketing

Once the strategic decisions have been taken, your company needs to implement the sales actions that will ensure that your offer is perfectly adapted to market expectations, and that your customer relationships are long-lasting. To do this, use a marketing plan, more commonly known as a “marketing mix”.

This marketing plan is defined on the basis of the “4 Ps”, which are the 4 essential variables for any marketing action: product (Product), price (Price), distribution (Place) and communication (Promotion).

These 4 essential elements of the marketing mix will help you answer the following questions:

• Which product best meets your customers’ needs (range, positioning, etc.)?
• What pricing policy should you adopt?
• What are the best distribution channels for your product or service?
• What are the best channels and strategies for your communications/marketing?

However, this marketing mix model based on the 4 Ps can be criticized for being mainly focused on the offer. However, more and more marketers want to focus on the customer dimension and the value proposition when developing and implementing their marketing approach.

That’s why some companies today choose to base their marketing plan on the “4 Cs” (Customer needs, Cost to satisfy, Convenience of buying, Communication):

• Instead of focusing on the product itself, the first C focuses on solving a problem or satisfying a need in the customer’s life.
• The second C represents the overall cost of the product (Cost) and not the selling price.
• The third C in Convenience is similar in spirit to the P in Place (distribution), but from the consumer’s point of view, i.e. the possibility for your customers to use a variety of distribution channels (Internet, physical points of sale, mobile, etc.). A multi-channel strategy, for example, will enable your company to better satisfy each market segment via the most appropriate distribution channel.
• The latest C from
  Communication
  is always aimed at giving visibility to your offer. But there’s more to it than that, because every aspect of your communications must be geared to personalized, long-term customer relationship management. A CRM (customer relationship management) platform remains the essential tool for achieving this.