Buyer Behaviour Group Assignment

Introduction

Huawei Technologies Co. Ltd is a Chinese multinational networking, services, and telecommunication equipment company, which headquartered in Shenzen, Guangdong (Wang 2016, p.173). Huawei has proliferated in recent years, from a small manufacturer to become a global leader in mobile technology. It can be seen how, in 2018, Huawei succeed overtook Apple to become the second biggest smartphone seller after Samsung. Huawei offers several varieties of smartphone based on the needs and wants of the customers. Huawei offers wide variety of the smartphone to choose, from very cheap devices, mid-range affordable price into a high-end smartphone.

In 16 October 2018, Huawei launched they first high-end smartphone named Mate 20 and mate 20 Pro. These smartphones become the most popular and best selling since its launch. At the time, the company succeeds sold ten million units devices within five months after they were launched (Rox 2019, paras 1-2). Huawei has surprised people by offering several features that have not yet appeared on many of its competitors. For instance, triple rear camera setup, dual nano sim card which allows a customer to use two sim card, or a sim card and NM card in one smartphone.

Use new artificial intelligence chipset called Kirin 980 giving users a longer battery life and increase speed connectivity, dual NPU which can boost the camera object’s recognition and able to recognize 4,500 images per minutes, fast charging which takes 30 minutes only to charge the phone from 0 to 70%, and wireless projection (Cragg 2018, paras 8-24). Meanwhile, the mate 20 Pro model has wireless reverse charger function which can turn the phone into a charging pad and able to charge another phone wirelessly.

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Furthermore, Huawei mate 20 edition has not only impressive features, but also has a stylish design which offers several color options such as pink gold, emerald green, twilight, black, and framed with a metal high gloss finish. Therefore, there will be no doubt if this smartphone becomes popular and sells successfully since its launch.

This report will define how Huawei Mate 20 can satisfy the customer needs and wants, by analyzing the segmentation, targeting, and positioning of Mate 20. Furthermore, we will define the buyer decision process of a smartphone, and customer internal, external influences in regard to purchasing the Mate 20, we also provide recommendations for competitors of the Mate 20.

Market Segmentation, Targeting and Positioning

Market Segmentation

According to Elliott, Thiele and Waller (2010, pp.175) Market Segmentation are characteristics that customer has in common and closely related to their purchasing behavior. Market segmentation divides by four categories, such as geographic, demographic, psychographic, and behavioral segmentation.

Based on geographic segmentation, Huawei targets the customer from all around the world, except US. From May 2016, Huawei successfully opens 35,000 retail stores worldwide and still planning to open new stores more globally (Tao 2017, paras 1). Which means potential customer able to purchase Mate 20 smartphone from their official retail stores anywhere in the world, except the US. In addition, Huawei also provides online shopping through their official website, customer all over the world except US can purchase Huawei Mate 20 from their website. Furthermore, Huawei also selling its product through third parties such as other online and retail stores, so that they able to expand its market and reach more customers.

Demographic segmentation for Huawei Mate 20 is both women and men, more than 21 years old, medium to high income, from a middle class, upper middle class to upper class.

Psychographic segmentation, people motivate to purchase this Mate 20 Smartphone with different purposes. Some people use for business focus, they buy the product to support their business. Secondly, Value chaser, people who seek first class features and services with economy price, Thirdly, socializer, as Mate 20 has triple rear camera and dual NPU features which give result high-quality picture, also has high speed data it can influence or motivate socializer people to buy this product to support them to upload picture and access their social network.

Behavioural segmentation, Huawei Mate 20 targets the behavior of the customer who is seeking the benefit. As we mentioned before, at the time Huawei has launched the product by offering several features which have not appeared yet on many of its competitors. Therefore, people interested in purchasing the product to try the new features, and expecting the benefits of the product based on what they pay for it.

Target Market

Huawei’s Mate 20 target market is for people who have middle to high income which is afforded to purchase the product, focused on people who are seeking smartphone with first class features but economy price, modern young people who open to change, businesspeople and socializer.

Positioning

Based on Mate 20 prices, Huawei defines itself as a high-end smartphone with ultimate performance and features, but at the same time charge the users with economy price compare to its main competitor such as Samsung and Apple, Huawei still charge a reasonable price considering the features that Huawei is offering. Huawei differentiates their product by launched Mate 20, offering several features that not yet appeared on its competitor. Furthermore, based on its slogan “higher intelligence,” the company creates a perception that Mate 20 is not only a smartphone, however, is an “intelligence phone,” a sophisticated phone which people had never been thought before.

How the iMate 20 Satisfies the Needs and Wants of Customer

According to Schiffman (2014, pp.72) needs are the essence of marketing concepts, company should have the ability to identify and satisfy consumer needs to survive, grow, and get profit in the highly competitive market. Several decades ago, the mobile phone was not a thing that people need it. However, nowadays, it is hard to find someone who does not have a mobile phone. Furthermore, with the advance of technology, people not only need a mobile phone for communicating only, but people also want something more features to entertain and support their daily life or business.

The company really understand the needs and the wants of the customer, as we can see nowadays people cannot be far from a smartphone, they need still connect to the internet to support their business and socializing, need longer battery life, need the best result of pictures, easy to recharge their phone, and affordable price. In this case, we believe that Huawei Mate 20 successfully satisfies the consumer needs and wants. By offering an impressive l smartphone with ultimate features and performance, affordable price compares to its competitor, excellent design, and outstanding photography.

Consider how a consumer may go through the decision-making process in a purchase of a mobile phoneThere are five stages of the consumer buying decision-making process.

Need recognition

The process begins when a consumer realizes they have a need. In today’s world possessing a mobile phone is no more a luxury but rather a necessity. The consumer will first become aware of the problems that come along with the absence of a mobile phone; difficulty in staying connected to others, missing out on world affairs and more.

Information search

The next stage is looking for information that will help solve their problem. The customer starts searching for information online and will also take advice from friends and family. He will decide what specific features he’s looking for in a mobile phone.

Option evaluation

Once the initial information search is complete, the consumer will evaluate their options. The specifications he’s looking for will be available in many mobile phones of many brands. He will then evaluate all his possible options on the basis of affordability, performance, quality and durability.

Purchase decision

At this point, the customer is ready to pull the trigger and make the purchase. They have made their decision as to which product and brand best fulfills their requirements.

Post-purchase evaluation

At this stage the customer reflects if they made the right decision. They will evaluate if the mobile phone they bought accurately and fully meets their needs.

How a consumer may be influenced by the Huawei Mate 20Internal influencesPersonal Motives and Needs

Personal motives and needs is considered to be the most crucial factor influencing purchase decision. The need can be termed as the difference of actual and desired state and motives signifies the drive which motivates a person to achieve his/her need (East et al. 2016). One of the needs of an individual may be concentrated on the feature of having a versatile phone which can be charged very quickly. The supercharge feature of the phone allows the brand to charge fast, 70% battery can be charged under 30 minutes duration (Consumer.huawei.com 2019). The motive or drive for the encouragement can be the price of the phone. The phone is going to be available in Australia and Europe and the Australian market will be enjoy a lower price than the European market. Price and availability can be considered as the motive for fulfilling the need of a smart phone. The price of Huawei Mate 20 in Australia is 1099 Australian dollars. Storage can be another need for the consumers. It has 980 Kirin processor and a 64 Giga Bytes (GB) of internal storage (Consumer.huawei.com 2019). The 128 GB storage can be expanded up to 256 GB with Huawei Nano memory card (Consumer.huawei.com 2019).

Attitude

Attitude is another internal influence which affects the buying behaviour of consumers by targeting their attitude. Attitude is what consumers thinks or feel about something (Ertz, Karakas and Sarig?ll? 2016). The aesthetic looks of the smart phone may be targeted for responding to the positive attitude of consumer towards the looks of a smart phone. Another negative attitude of the consumer of ‘getting a phone ruined by water’ was addressed by the splash resistant feature. The attitude of preferring a smart phone which acts as a mini version of laptop or desktop. The 6.53 inches screen size enables the customers to have an extravagant experience for watching a video and for gaming purposes. The experience will present a feel of a desktop but with the association of convenience and flexibility.

External Influences Culture

The values, beliefs and attitude are the shaping elements of the culture, which constructs the attitude regarding purchasing services or products. Culture is known for stimulating emotional needs, which leads to the behaviour of protecting the own culture through the features and offerings of the product. Mate 20 Pro and Mate 20 have various similar features but have a price difference of around 500 Australian dollars. The belief and attitude towards getting an almost similar smart phone under lower price range will influence the buying behaviour of the consumers. In 500 AUD less the consumers can experience a range of features and benefits, giant display, sensational battery and quality camera. The attitude of using smart phones for the purpose of gaming is responded by the brand by including features like 128 GB of internal storage, more accessible as compared to Razer phone 2 and 120 Hz display.

Social Class

This means the orderly arrangements of the society into several levels as per the income groups that helps in understanding the social status of the consumers. The consumption patterns, activities, life styles, interests, media patterns and attitude of the people vary in each social class and are important factors of determining the consumer behaviour (Lantos 2015). The Huawei Mate 20 comes at a price range of around $1099 and hence belongs to the higher social class. People tend to believe that higher the price, higher is the quality and the price of this product attracts the higher classes of people (Sawitri, Hadiyanto and Hadi 2015). The aesthetic designs and the high end features offered by the product by co-engineering with Leica provide a classy look. The unique craftsmanship creates a smooth and warm contrast to the glass back that the higher class would prefer to comfortably hold in their hands. It is a symphony on the hand.

Recommendation for the competitors of the Huawei Mate 20A consumer is influenced by both; internal and external forces. The internal forces are the individual’s specific needs and requirements and also their attitude. Some consumers may be interested in the versatile features that the phone offers while few may be attracted to the outlook of the phone.

The competitors can take advantage of the external forces. One of the external forces is the culture as a consumer’s buying behavior is highly affected by his cultural values and beliefs. Some consumers prefer a phone in lower price range that may give them maximum features therefore, the competitors can target the market by providing similar features as iMate 20 but at a slightly lower price.

Buying behavior also depends on the consumers’ socio economic class. People tend to believe that products of high price will be of better quality and iMate 20 attracts consumers belonging to the upper social class. The competitors can launch similar phones with different pricing so that they can make sales not only in the upper social class but can also target the middle social classes.

People also get influenced by other people’s views and suggestions. The competitors can hire brand ambassadors for their products that are popular amongst their target audience. Brand ambassadors can be a source of encouragement for the consumers to make the purchase. They can also hire people to spread positive word of mouth about their brand and product. While the consumers evaluate their options, they also look for other people’s reviews about the product which helps them in better decision making.

To gain more market, the competitors can do rigorous digital and social marketing. They can do below the line marketing to engage with the consumers on a one on one level. This will not only gain their trust in the brand or the product but will help create an experience for them, increasing sales and loyal customers.

Summary

The development of mobile phones and technology has been inspired by innovation and advancements over the period of time due to the changing needs and preferences of the consumers. In the current highly competitive market, the mobile phone manufacturers try to create a differentiation and earn a competitive edge as to fight for a bigger market share and persuade the consumers to purchase their product instead of their competitor’s. The consumer enjoys a large variety of brands and products available in the market but his buying decision is influenced by two major factor; internal (individual) and external (environmental).

Usually price is the most dominant factor while making purchase decision, with the features incorporated in the mobile phone closely behind. All the mobile phone manufacturers should carefully generate their strategy when producing, marketing and distributing these devices and focus on building a strong brand personality, positioning and differentiation. Not only do they have to focus on their own strategies but they are expected to closely follow their competitors’ as well.

The only way to be successful in such a competitive market is to make sure you put the consumer’s need as your priority. Build a product that satisfies their needs, is of high quality and is durable so that they do not feel the urge to switch products and brand. The manufacturers should also consider the selling price of their products so as to make it affordable for all people belonging to different income classes.

Reference List

1. Cragg, O 2018, Here are the top 5 huawei mate 20 and mate 20 pro features, viewed 18 May 2019, <
2. Elliott, G, Thiele, RS & Waller, D 2010, Marketing, John Wiley & Sons, Australia.Lee, T 2018, ‘first look at huawei’s higerh intelligence mate 20 and mate 20 pro smartphones at London global launch, CNA Lifestyle, 16 October, viewed 28 May 2019, <
3. Rox, R 2019, In just five months Huawei has sold 10 million mate 20 phones, viewed 18 May 2019, <
4. Schiffman, LG 2014, Consumer Behaviour, Pearson, Australia.Tao, L 2017, ‘huawei boosts retail channels to stem margin decline’, South China Morning Post, 27 July, viewed 19 May 2019, < M 2016, ‘The study of Huawei mobile phone marketing strategy that impacts customer satisfaction’, vol.4, no. 2, pp. 173-181, viewed 18 May 2019,