1th presentation

Question 1

Neo-classical Economics

Answer 1

Preferences are: 
discovered
transitive
time-consistent
No capacity constraints

Question 2

Rational Agent Model

Answer 2

Given the right information, people will maximize—always choose the product that best matches their (stable) preferences

Question 3

CB helps firms learn to…

Answer 3

…efficiently communicate information to facilitate consumer choice and to facilitate preference discovery

Question 4

Behavioral Decision Theory

Answer 4

Preferences are
constructed
not necessarily transitive
can be time-inconsistent

Information processing is constrained

Question 5

Bounded rationality

Answer 5

People will satisfice—choose products beyond a sufficient threshold, are inconsistent, ineffective, and often require help making choices

Question 6

CB helps firms learn…

Answer 6

…what consumers want, how consumers think, and how to shape consumer choice

Question 7

Segmentation

Answer 7

The 4 basic types of market segmentation are:

1. Demographic
2. Psychographic
3. Geographic
4. Behavioral

Question 8

Heuristics

Answer 8

A heuristic is a mental shortcut that allows people to solve problems and make judgments quickly and efficiently. These rule-of-thumb strategies shorten decision-making time and allow people to function without constantly stopping to think about their next course of action.

Question 9

A consumer is…

Answer 9

a person who identifies a need or desire, makes a purchase, and then disposes of the product.

Question 10

Perception

Answer 10

translates raw stimuli into meanings

Question 11

Perception

Answer 11

Perception - The process by which an individual selects, organizes, and interprets stimuli into a meaningful and coherent picture of the world

Question 12

Elements of Perception

Answer 12

Elements of Perception:
Sensation
Absolute threshold
Differential threshold
Subliminal perception

Question 13

Perceptual map –

Answer 13

Perceptual map – marketing tool to evaluate the relative position of compatitive brands along relevant dimensions

Question 14

Hierarchy of senses

Answer 14

Hierarchy of senses:
Vision (the most objective)
Audition
Touch
Smell
Taste (the least objective)

Question 15

Sensation

Answer 15

Sensation is the immediate and direct response of the sensory organs to stimuli

Question 16

A stimulus is..

Answer 16

A stimulus is any unit of input to any of the senses.

Question 17

Marketing stimuli:

Answer 17

advertisements
price promotions
product change
….Sensory Marketing!

Question 18

Slow music…

Answer 18

Slow music makes people take their time and spend more money.

Question 19

Loud music..

Answer 19

Loud music makes them move through the store quickly without affecting sales.

Question 20

Classical music…

Answer 20

Classical music leads people to buy more expensive merchandise.

Question 21

Smell/Olfactory

Answer 21

“Of all the five senses, smell is the one that creates the most powerful impression in your brain. A particular scent can trigger memories from a long time ago. (…) Smells creates memories and appeal directly to feelings.” (Wenham 2010)

Question 22

Taste/Gustatory

Answer 22

Taste is dependent to other senses: “Every single taste (…) is a combination of all our five Senses” (Krishna 2012 p. 342)

Question 23

Absolute threshold

Answer 23

Absolute threshold is the lowest level at which an individual can experience a sensation.

Question 24

Differential Threshold - JND

Answer 24

Differential Threshold (Just Noticeable Difference – JND) - Minimal difference that can be detected between two similar stimuli

Question 25

Weber’s law

Answer 25

The JND between two stimuli is not an absolute amount but an amount relative to the intensity of the first stimulus

The stronger the initial stimulus (e.g., size, weight, price, design), the greater the additional intensity needed for the second stimulus to be perceived as different.

Question 26

Marketing Applications of the JND

Answer 26

Marketers need to determine the relevant JND for their products
so that negative changes are not readily apparent to the public
so that product improvements are very apparent to consumers

Question 27

Exposure

Answer 27

Exposure

Possibility of noticing the information

Question 28

Attention

Answer 28

Attention

the information has been recorded in some way (it has been noticed)

Question 29

Attention:Key concepts

Answer 29

Attention is limited.

Attention is selective.

Question 30

Selection Depends Upon:

Answer 30

Nature of the stimulus
Expectations
Motives

Question 31

Nature of the stimulus

Answer 31

Includes the product’s physical attributes, package design, brand name, advertising and more…

Question 32

Expectations

Answer 32

Based on familiarity, previous experience or expectations.

Question 33

Motives

Answer 33

Needs or wants for a product or service.

Question 34

How Attention Works: 2 States of Attention

Answer 34

Location State (Where?)

Identification state (What?)

Question 35

Location State (Where?):

Answer 35

Saliency Map (Treisman et al 1980, Wolfe et al 1994)
Systematic Search (Monk 1984, Ponsoda et al 1995)

Question 36

Identification state (What?):

Answer 36

Gather more information of selected object: e.g., reading, holding, etc.

Question 37

Saliency map

Answer 37

Salient locations/objects capture attention involuntarily and instantaneously, e.g.:

salient color
unique orientation

Question 38

Which Stimulus is Salient?

Answer 38

Novelty:

Stimuli that appear in unexpected ways or places tend to grab our attention

Question 39

How we can help Systematic Search

Answer 39

Position:

Stimuli that are present in places we’re more likely to look stand a better chance of being noticed

Question 40

Interpretation

Answer 40

Interpretation refers to the meaning we assign to sensory stimuli, which is based on a schema

Question 41

Closure principle

Answer 41

People tend to perceive an incomplete picture as a complete and meaningful whole