Paper Example on Consumer Behaviour Model: Environmental Factors

Introduction

Lululemon is athletic apparel and technical clothing business which focuses on the offering of high-quality products at reasonable prices (Hoover's Inc., n.d). Therefore, the most critical environmental factors that are relevant to the customers are offering and price. Majority of its customers choose to focus on the quality of the product offered since they need it to be durable. Most sportswear tends to wear out quickly due to the nature of activities which users engage. Therefore, they prefer to make a purchase that will last them long enough to make it worth the price. That is the reason why the second most important factor is the product price. Athletic apparel and technical clothing are not basic needs for many. They feature products which have been developed from special material meant to offer protection to users. That is why the products tend to be quite costly, unlike usual pieces of clothing. However, Lululemon does not exaggerate the prices, which is why the set amount is perceived as a fair price by many.

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Consumer Behaviour Model: Consumer factors

Concerning consumer factors, the most important ones feature lifestyle, perception, and social class. Lululemon products are luxury products, meaning that many can still do without them. That is why it targets a specific group who would be willing to spend the money and make a purchase. The lifestyle of the consumer matters a lot. If the consumer is not one who engages in sports frequently, he will not be interested in making a purchase. However, those who want to lead active lifestyles by engaging in various sports may find it a necessity to own these products. The perception that the consumer has will also influence the purchase decision. One must be able to perceive the product as one of high quality that is being sold at a great price. They need to view it as a product that will last and serve its purpose before being influenced to make a purchase. Lastly, social class is also important because, for some, the products may just be a luxury rather than a basic need. The consumer needs to be willing to spend on these products instead of working out in general attires. Therefore, the middle to upper social classes is the most likely group to make the purchase.

Role of involvement in consumer decision-making

To make a purchase or no purchase decision, the customer of Lululemon will have to go through a high-involvement process. The products of this company are high-involvement since they carry great risks in case they fail. They are also highly-priced compared to the normal clothing that people wear every day. The products are designed specifically for various sporting activities. Therefore, routine response behaviour is not showcased since it is quite difficult for consumers to engage in impulse buying. On the contrary, they tend to engage in extended problem solving, which features spending so much time researching the product and its prices before making a purchase. The consumers need to be convinced that it is the right choice which will meet their sporting needs without taking too much financial risk.

Consumer decision-making process

Marketing can greatly influence consumer decision-making at each of the six stages. In the first stage of need recognition, the consumer realises that he needs sportswear that will protect his elbow and knees in case of a fall (Stax Inc., 2017). The whole body should also be protected from any cuts or bruises. At this point, Lululemon can market its products which feature special materials that are tough and not easily torn. The likelihood of getting any injuries in this sportswear is very minimal. In step two, the client starts looking for product information. Here, Lululemon needs to consider customer feedback and use of social media to get previous customers to share their experiences. Third, the consumer engages in product evaluation. At this point, Lululemon can advertise itself as a company offering quality sportswear at reasonable prices as compared to its competitors. That will place the company at a better position of being considered for the purchase. Fourth, the consumer makes the actual purchase based on the final decision made. To ensure the process is made easier, Lululemon should state where the store is and even advertise itself as having an online store for the customer's convenience. Fifth, the evaluation post-purchase takes place, and the client decides whether the product is worth it. Lululemon can use its marketing to contact the consumer and get any feedback on the product purchased (Stax Inc., 2017). Any steps for improvement will also be considered. Lastly, if the customer shows satisfaction, another sports product can be marketed to them in the last step. It increases the likelihood of them making yet another purchase.

Part 2 - Market Segmentation, Targeting, and Positioning

Segmentation

For Lululemon sportswear products, two market segments can be identified. The first one features the trendy urban segment. That features consumers who perceive themselves to be fashion-oriented and active (Hoover's Inc., n.d). Therefore, they will choose Lululemon products because they need to use the products for sporting activities as they always purchase such products (McAlexander et al., 2015). They will also need the product because it is considered trendy to engage in sports while in the right attire. Lastly, they purchase the products because of the high quality and protection they enjoy from using them. The second features the wealthy market segment (Hoover's Inc., n.d). It features individuals from the middle to the upper social class who can purchase the products simply because they have the financial power to do so. Also, their lifestyle promotes physical activities so that they can maintain good health. Lastly, they understand that sports gear are much more effective than normal clothing when it comes to exercising.

Target Market

Considering the two segments above, the target market is the "Urban Trendy" market segment. It is the most profitable for Lululemon and represents opportunities for growth since the majority of consumers fall within this range (Korstrom, 2018). Today, many people living in urban areas are changing their mindset to embrace physical activities and healthy lifestyles. Also, they want to look good and feel great about themselves even as they are performing these activities (McAlexander et al., 2015). More individuals will likely adopt a similar mindset considering the increased need for healthier lifestyles. Lastly, the goal of Lululemon is to support physical activity that will enable individuals to lead healthier lives (Lincoln Lululemon hosts fitness classes, promotes exercise, 2019). This target market is supporting the outcome.

Target Market Strategy

Concerning the marketing strategy, Lululemon should continue to pursue both the newly identified market as well as the existing ones. Through this multi-segment marketing, the company will be able to reach more customers who also contribute towards its success. Currently, the market is not highly concentrated as not many companies are offering sports products (Korstrom, 2018). By focusing on many segments at once, the company will be able to experience more growth since more individuals are becoming knowledgeable about sports, and the importance of the right sportswear. Hence, focusing on the fashion-oriented population alone will mean that the company will not appeal to those who are trying to get active or those who want affordable safety products for their use.

Positioning

Considering the map's outcome, it is clear that customers perceive Nike to be a better option in terms of comfort. However, Adidas is perceived to have a better product cost than the other competitors. Therefore, Lululemon only has two competitors that it must outdo in terms of product comfort and price, as well as concerning the comfort of use. Since the number of competitors is few, the company can remain in this space and compete with others. However, it will need to introduce some changes in its strategy to ensure that its position improves in the market. Ideally, some cost adjustments are needed, as well as changes in product material to ensure that customers enjoy comfort in addition to being protected from injuries (Setini & Caisar Darma, 2020). However, if the comfort of the product is increased to match that of Nike, or even go beyond it, then consumers may not have a problem with the current product price being used.

References

Hoover's Inc. (n.d.). Lululemon Athletica Canada Inc. Hoover's Company Records - In-Depth Records. Retrieved from https://app-avention-com.ezproxy.umuc.edu/company/2daee78d-d97d-3c08-9dfd-5732be06758f#report/company_summary

Korstrom, G. (2018, October 30). International expansion key to Lululemon success. Retrieved from https://biv.com/article/2018/10/international-expansion-key-lululemon-success

Lincoln Lululemon hosts fitness classes, promotes exercise. (2019, November 27). UWIRE Text, p. 1. Retrieved from https://link-gale-com.ezproxy.umuc.edu/apps/doc/A606880009/AONE?u=umd_umuc&sid=AONE&xid=87cb97e0

McAlexander, J., Koenig, H., & DuFault, B. (2015). Millennials and Boomers: increasing alumni affinity and intent to give by target market segmentation. International Journal of Nonprofit and Voluntary Sector Marketing, 21(2), 82-95. doi: 10.1002/nvsm.1544

Setini, M., & Caisar Darma, D. (2020). Towards Market Share: Segmentation, Target and Market Position. International Business Management, 13(9), 405-414. doi: 10.36478/ibm.2019.405.414

Stax Inc. (2017, April 5). Customer Decision-Making Criteria and the Importance of Price. Retrieved from https://medium.com/stax-insights/consumer-decision-making-criteria-and-the-importance-of-price-1783d5589a8e