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CONSUMER BEHAVIOR. BUAD 307 MARKETING FUNDAMENTALS. Why does Staples sell Starbucks coffee?. Influences on and of Consumer Behavior. PERCEPTION/ SENSATION. MARKET RESEARCH. INFO SEARCH. COGNITION. CHOICES. STRATEGY. AFFECT. PREFERENCES. BELIEFS. CONSUMER. COMMUNICATION.

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consumer behavior

CONSUMER BEHAVIOR

BUAD 307

MARKETING FUNDAMENTALS

influences on and of consumer behavior
Influences on and of Consumer Behavior

PERCEPTION/

SENSATION

MARKET

RESEARCH

INFO

SEARCH

COGNITION

CHOICES

STRATEGY

AFFECT

PREFERENCES

BELIEFS

CONSUMER

COMMUNICATION

SOCIAL AND

OTHER INFLUENCE

learning outcome objectives
Learning Outcome Objectives
  • Understand how consumer cognitive (thinking) processes and limitations, affect, beliefs, social influences, and other contextual factors influence consumer decision making, choices, and behavior
  • Appreciate how these insights can be used to design and implement effective marketing strategies
  • Appreciate individual and segment differences in process and outcome
true or false
True or False?
  • If you have bad breath, you cannot smell it yourself.
  • If you eat a balanced diet, you do not need vitamin supplements.
  • Using a razor with five blades will reduce the likelihood of cutting yourself and will result in less skin irritation.
  • Dell Computers tend to be of higher quality than those made by HP and Sony.
  • Rust stains on clothes can be removed with the use of lemon juice. Bleach actually makes these stains worse.
questions faced by consumers
Questions Faced By Consumers
  • Are veggie burgers actually healthy?
  • What makeup should you use to get an “even” skin tone?
  • Do I get any useful benefits from spending more than $125 on a digital camera?
  • Should I get a “make-over?” What am I looking for? What should I do?
  • Is my mechanic honest?
  • Which tie should I wear for a job interview?
  • Should I give my wife roses, chocolate, or software?
consumer problems and recognition
Consumer Problems and Recognition
  • Consumer problem:Discrepancy between ideal and actual state--e.g., consumer:
    • Has insufficient hair
    • Is hungry
    • Has run out of ink in his or her inkjet cartridge
  • Problems can be solved in several ways--e.g., stress reduction <----- vacation, movie, hot bath, medication
consumer decisions theory and reality in consumer buying
CONSUMER DECISIONS:Theory and Reality in Consumer Buying

PROBLEM

RECOGNITION

INFORMATION

SEARCH

EVALUATION OF

ALTERNATIVES

PURCHASE

POSTPURCHASE

EVALUATION/

BEHAVIORS

Theory

Complications

approaches to search for problem solutions
Approaches to Search for Problem Solutions

INTERNAL

Memory

Thinking

EXTERNAL

Word of mouth, media,

store visits, trial

CATALOG

options identified and considered
Options Identified and Considered

UNIVERSAL SET

All possible options

RETRIEVED SET

Options that readily come to mind

EVOKED SET

Options that will be considered by the consumer

Note: Retrieved and evoked sets will vary among different consumers

reminder
REMINDER
  • For low involvement products, efforts aimed at affecting internal search tend to be more effective—the consumer is usually not willing to expend energy on external search.
  • External search is more likely for higher involvement products.
decision making issues
Decision Making Issues
  • Involvement level
    • Temporary
    • Enduring
  • Consumer locus of control
    • Internal
    • External
  • Product category complexity
  • Consumer knowledge
evaluation type
Evaluation Type
  • Compensatory: Decision based on overall value of alternatives (good attribute can outweigh bad ones)
  • Non-compensatory: Absolutely must meet at least one important criterion (e.g., car must have automatic transmission)
  • Hybrid: Combination of the two (e.g., one non-compensatory measure, then compensatory tradeoffs on other attributes
  • Abandoned strategy: Consumer finds initial criteria unrealistic and proceeds to less desirable solution

IMPORTANT

LESS

IMPORTANT

heuristics low involvement decision rules
Heuristics—Low Involvement Decision Rules
  • If either Coke or Pepsi is on sale, buy that brand; otherwise, buy Coke
  • The larger the navels, the better the orange
  • The larger package is likely to offer a lower unit price (not true in reality)
attitudes components
Attitudes―components

BELIEFS

AFFECT

(FEELING)

BEHAVIORAL

INTENTIONS

attitude components
Attitude Components
  • Beliefs
    • Can be positive, negative, or neutral
    • May or may not be accurate
    • May contradict other beliefs held by the other person
  • Affect
    • May be positive or negative
    • May take on specific dimension (e.g., pleasure, disgust)
  • Behavioral Intentions
    • An individual’s plan or expectations of what he or she will do
    • May appear inconsistent with beliefs
    • May not predict well what the individual will do in reality
generating beliefs through advertising
Generating Beliefs Through Advertising
  • Statements must be
    • Perceived
    • Comprehended
    • Remembered
    • Believed (at least in part)
positioning through creating beliefs
Positioning Through Creating Beliefs
  • “It’s not delivery; it’s De Journo!”
  • “Wal-Mart. Always low prices. Always.”
  • “I just saved a bunch of money on my auto insurance.”
  • “U-um Good!” (Campbell’s Soup)
multiattribute models of attitude
Multiattribute Models of Attitude
  • Attitude computed as a function of multiple attributes weighted for importance:

Ab= attitude toward brand b

Wi: weight of attribute I

Xib: belief about brand b’s performance on attribute I

  • Model assumes rationality

Calculations will not be required on the exam. You should know conceptually what this involves conceptually—i.e., weighing importance and intensity of feeling.

multiattribute models
Multiattribute Models
  • Caveats
    • Different segments exist that will weight factors differently—thus, overall averages can be misleading. Separate analyses should be done for different segments of interest. (Segments can be identified by certain statistical techniques).
    • Individual differences exist in scale intensity—for some, it is much “easier” to be extremely good or extremely bad.
    • Prior research may be needed to identify issues (dimensions) to be weighted.
    • Some factors may be intangible—What are the substantive differences between Windows and Apple computers?
    • Non-compensatory factors—“must-haves”—may determine final result.
  • Applications
    • Determining
      • Overall performance
      • Areas of strength and weakness
    • Comparison to competitors
      • Overall
      • Areas of strength and weakness

REMINDER:

PERCEPTIONS ARE NOT NECESSARILY ACCURATE. We are looking to work with what consumers believe.

affect
Affect
  • Based on
    • past emotional associations of product
    • emotional effect of beliefs
attitude characteristics
Attitude Characteristics
  • Availability/accessibility
  • Constructed vs. natural
  • Strength
measurement of attitude components
Measurement of Attitude Components
  • Beliefs
    • Semantic Differential Scales
        • Good -------------------Bad
        • Fast --------------------Slow
        • Reliable-----------------Unreliable
  • Feelings
    • Likert Scales (Strongly agree … Strongly Disagree)
        • “This product makes me happy.”
measurement
Measurement
  • Behavioral Intention
    • Rating of likelihood of purchase
    • May need projection if social desirability affects willingness to admit to product use
attitude change strategies part i
Attitude Change Strategies, Part I
  • Change Affect
    • Classical conditioning
      • “Pairing” the brand or product with desired stimulus—e.g., a car with a beautiful woman
    • Attitude toward the ad
      • A likable ad for a brand in a mundane product category—e.g.,
        • Energizer Bunny
        • Snuggles (fabric softener)
    • Mere exposure
attitude change strategies ii
Attitude Change Strategies II
  • Change behavior (e.g., sampling)
    • Attitudes are inferred from behavior (e.g., I buy the product  I must like it or It must be good)
  • Change Belief Component
    • Change existing beliefs
      • Difficult
      • Advertiser’s motives are suspect
    • Change importance of attributes
    • Add beliefs
    • Change ideal (fashion)
adding beliefs true or not examples
Adding Beliefs (True or Not): Examples
  • Brushing and flossing do not reach all areas of the mouth
  • People under stress need more vitamins
  • Baking soda will reduce odor of refrigerators
  • Fragmented hard drives may cause computer errors
reminder28
REMINDER
  • Changing currently held beliefs tends to be difficult—people know the marketer has an ulterior motive
  • Adding new beliefs that are not inconsistent with what is already believed may be more effective
one sided vs two sided appeals
One-sided vs. two sided appeals
  • One-sided: only saying what favors your side
  • Two-sided: stating your case but also admitting points favoring the other side
    • Why is this effective?
potential family life cycle stages
Potential Family Life Cycle Stages

YOUNG

COUPLE

YOUNG

SINGLE

EMPTY NEST

I/II

FULL NEST

I/II/III

SINGLE

PARENT

OLDER

SINGLE

BLENDED

economic marketing implications of household cycles
Income tends to increase with time

But children/ obligations add cost

Divorce

increases costs

may change income distribution marriage

Product demand due to

singles with low expenses

new couples

divorced families

children

empty nesters --> more income

Economic/Marketing Implications of Household Cycles
household decision making
Roles/influence

Information gatherers/holders

Influencers

Decision makers

Purchasers

Users

Household Decision Making
the means end chain
The Means-End Chain

Aim promotion/

positioning at higher

levels of chain!

Self-esteem

Values

Feeling of power

Consequences

Performance

Attributes

Fast acceleration

Large engine

subliminal perception a diabolical marketing tool
Subliminal Perception: A Diabolical Marketing Tool?
  • Subliminal messages in ads are illegal in U.S.
  • Some research support for modest effects
    • Probably limited to one syllable words
    • Complex messages can probably not be processed subliminally
message framing
Message Framing
  • Many tradeoffs can be stated in two, mathematically equivalent ways—e.g.,
    • “80% lean” vs. “20% fat”
    • $49.00 per person per night based on double occupancy
some consumer behavior issues that will come up elsewhere in the course
Some Consumer Behavior Issues That Will Come Up Elsewhere in the Course
  • Demographics (segmentation)
  • Lifestyle (segmentation)
  • Culture/subculture (segmentation, international marketing)
  • Diffusion of innovation (product)
  • Attention (promotion)
organizational buyers
Types

Industrial

Reseller

Government and non-profit organizations

Purchase types

Straight rebuy

Limited decision making

Extended decision making

Characteristics

Greater involvement

Bureaucracy

Long term relationships

Price is important but may not be the most important factor

Organizational Buyers