Chapter 1: Intro To Consumer Behaviour Flashcards
Consumption Communities
Web groups in which members share views and product recommendations online
Anything from baseball fantasy team lineups to iPhone apps
Market segmentation
Organizations target it’s products, service, or idea only to specific groups of consumers rather than to everyone
Lifestyle statement
It says a lot about a persons interests, as well as something that they would like to be
Brand loyalty
Bond between product and consumer that is very different for competitors to break
Consumer behaviour
The process involved when individuals or groups select, purchase, use, or dispose of products, services, ideas, or experiences, to satisfy needs and desires
The items we consume
Range from peas to massages, anything really such, raggae music, or a celebrity like Katy aperry
In its early stages of development, the field of consumer behaviour was often referred to as _______
Reflecting an emphasis on the interaction between consumers and producers at a time of purchase
Buying behaviour
Why did buyer behaviour change to consumer behaviour?
Marketers now recognize that consumer behaviour is an ongoing process, not merely what happens at the moment someone hands over money and receives the good
Exchange
The process whereby two or more organizations or people give and receive something of value
Issues that arise during stages in consumption process (figure 1.1)
Take a look at the chart
Why should we learn about consumer behaviour?
Understanding consumer behaviour is good business
Firms only exist to satisfy consumer needs
These needs can only be met when marketers understand what people want
______ about consumers help marketers define the market and identify threats to a brand and opportunities for it
Data
Marketing segmentation (definition)
Identifies groups of consumers who are similar to one another in one or more ways and then devises marketing strategies that appeal to one or more groups
80/20 rule
20 percent of sales account for 80 percent of sales
This shows the importance of brand loyalty - by identifying the most faithful customers using market segmentation they can maximize profits
Demographics
Statistics that measure observable aspects of population, such as birth rate, age distribution, and income
Psychographics
The use of psychological, sociological, and anthropological factors to construct market segments
Or differences in consumers personalities, attitudes, values, and lifestyles
Few of the Most important demographic dimensions
Age Gender Family structure and life stage Social class and income Ethnicity Geography Lifestyles
Relationship marketing
The process of creating, maintaining, and enhancing strong, value-laden relationships with customers
Database marketing
Marketing that focussed on tracking specific consumers behaviours habits very closely and crafts products and messages tailored precisely to people’s wants and needs based on this information
Types of relationships a person may have with a product:
1) SELF-CONCEPT ATTACHMENT
2) NOSTALGIC ATTACHMENT
3) INTERDEPENDENCE
4) LOVE
1) SELF-CONCEPT ATTACHMENT
The product helps to establish the user’s identity
2) NOSTALGIC ATTACHMENT
The product serves as a link with a past self
3) INTERDEPENDENCE
The product is a part of the user’s daily routine
4) LOVE
The product elicits emotional bonds of warmth, passion or other strong, positive feelings
Types of marketing stimuli
In the forms of:
Advertisements
Stores
Product competing for our attention and out dollars
Popular culture
Music, movies, sports, books, celebrities, and other forms of entertainment consumed by the mass market
Consumer-generated content
A hallmark of web 2.0, arising when everyday people voice their opinion about products, brands, and companies on blogs, podcasts, and social networking sites and film their own commercials that they post on websites
One of the fundamental premises of the modern field of consumer behaviour is that
People often buy products not for what they do but for what they mean
The roles products play in our lives go well beyond the tasks they perform
Example: buying Nike is more than choosing athletic wear, you may be making a lifestyle statement about the type of person you are or want to be
global consumer culture
in which people around the world are united by their common devotion to brand-name consumer goods, movie stars, and celebrities.
Virtual Consumption
Electronic marketing increases convenience by breaking down many of the barriers caused by time and location.
Facilitated B2C and C2C commerce
horizontal revolution
information flow across people
characterized in part by the prevalence of social media
Social media
the online means of communication, conveyance, collaboration, and cultivation among interconnected and interdependent networks of people, communities, and organizations enhanced by technological capabilities and mobility.
synchronous interactions
ones that occur in real time, such as when you text back and forth with a friend
asynchronous interactions
ones that don’t require all participants to respond immediately, such as when you text a friend and get an answer the next day
culture of participation
The notion that social media platforms enable the user to freely interact with other people, companies, and organizations, allowing the user to share content and build on the content of others
“the Internet of things” (IoT)
the growing number of smart, connected, and interactive products available to consumers today
M2M
machine-to-machine communication
These are some of the important consumer trends that will impact marketing strategies in the near future:
1) SHARING ECONOMY
2) AUTHENTICITY AND PERSONALIZATION
3) BLURRING OF GENDER ROLES
4) DIVERSITY AND MULTICULTURALISM
5) SOCIAL SHOPPING
6) HEALTHY AND ETHICAL LIVING
7) SIMPLIFICATION
8) ANONYMITY—
1) SHARING ECONOMY
a continued blurring of the boundary between producers and consumers, as “everyday people” take on the roles of hoteliers, taxi drivers, and even advertising agencies. We will see a de-emphasis on the value of owning products such as automobiles and power tools as opposed to leasing them on an as-needed basis. Today consumers want to avoid ownership and the financial costs and responsibilities that come with it. We would rather “rent” an experience than own a thing.
2) AUTHENTICITY AND PERSONALIZATION
an aversion to corporate “hype,” as consumers place a premium on knowing the lineage of the companies they patronize. Consumers also will demand more individualized experiences rather than buy mass-market products and services. There will be an increase in artisanal products and continuing growth of the “maker movement,” augmented by wider availability of 3D printing technologies. Shoppers are willing to pay more for an item when they know exactly where it comes from, and they are assured that “real people” have thoughtfully selected the things from which they choose. This process of curation, which used to refer to an expert who carefully chooses pieces to include in a museum exhibit, now applies to a range of consumer products such as food, clothing, and travel.
3) BLURRING OF GENDER ROLES
the continuing movement away from gender binarism as sexual identity becomes more fluid and more people refuse to identify themselves as male or female. In Canada, individuals who do not identify as male or female now have another option to check off on a passport
4) DIVERSITY AND MULTICULTURALISM
racial and ethnic divisions will blur as people are exposed to other groups both in person (e.g., at the workplace) and online. Intermarriage rates continue to accelerate; a growing number of countries no longer adhere to strict categories when they ask citizens to identify racial identity.
5) SOCIAL SHOPPING
the traditional lone decision maker will become harder to find, as ready access to product reviews and others’ immediate feedback turns many buying situations into committee decisions.
6) Healthy and ethical living
a continued focus on wellness, physical fitness, and environmental sustainability. This priority is likely to divide along social class lines, as growing economic inequality makes it difficult for less affluent consumers to afford healthy and sustainable products.
7) SIMPLIFICATION
a movement away from “hyperchoice” and toward “de-cluttering” of one’s life and possessions, plus a higher priority on “experiences” rather than acquiring “things.”
8) ANONYMITY
data hacking, cyberbullying, and advertising tracking that fuel a desire for “the right to be forgotten.” Consumers will flock to platforms like Snapchat that don’t retain posts, or that allow users to create alternative identities
Business ethics
essentially rules of conduct that guide actions in the marketplace—the standards against which most people in a marketplace judge what is right, wrong, good, or bad
Universal values include
Honesty, trustworthiness, fairness, respect, jutstice, integrity, concern for others, accountability, and loyalty
Prescribing Ethical Standards of Conduct
Professional organizations often devise a code of ethics for their members.
One of the most common and stinging criticisms of marketing is that marketing techniques (especially advertising) are responsible for
convincing consumers that they “need” many material things and that they will be unhappy and somehow inferior people if they do not have these “necessities.”
Need (definition)
basic biological motive
Want (definition)
represents one way society has taught us to satisfy that need
culture jamming
aims to disrupt efforts by the corporate world to dominate our cultural landscape
Examples: TV turnoff day and Buy Nothing Day
corporate social responsibility (CSR)
Corporate activities that benefit the community in some way through a positive social, ethical, or environmental impact
cause-related marketing
Type of marketing that involves collaboration between a for-profit business and a nonprofit organization for mutual benefit
Differs from corporate giving (or philanthropy) in that cause marketing is not solely based on donations
green marketing
Marketing strategy involving an emphasis on protecting the natural environment
Example: Removing wasteful packaging
Greenwashing
Companies making fake or exaggerated claims about how environmentally friendly their products are
Social marketing
The promotion of causes and ideas (social products), such as energy conservation, charities, and population control
refers to using marketing techniques normally employed to sell beer or detergent to encourage positive behaviours such as increasing literacy or to discourage negative activities such as drunk driving
transformative consumer research (TCR)
Promotes research projects that include the goal of helping people or bringing about social change
The Dark Side of Consumer Behaviour
There is a “dark side” to some behaviours that can have negative impacts on consumers and society.
Dark sides include:
Kale’s own ideas
1) People being killed on big sale days such as Black Friday
2) Excessive drinking or smoking from social pressures
3) Shoplifting and insurance fraud
4) exposure to unattainable media ideals of beauty and success
Real dark sides of consumer behaviour
1) Addictive Consumption
2) Compulsive consumption
3) Illegal activities
4) Anticonsumption
Consumer addiction
a physiological or psychological dependency on products or services
Includes addictions to alcohol, drugs, cigarettes
Compulsive consumption
refers to repetitive shopping, often excessive, done as an antidote to tension, anxiety, depression, or boredom
Shopaholics
Compulsive consumption is distinctly different from impulse buying
The impulse to buy a specific item is temporary, and it centres on a specific product at a particular moment. In contrast, compulsive buying is an enduring behaviour that centres on the process of buying, not the purchases themselves
Much negative or destructive consumer behaviour can be characterized by the following three common elements:
The behaviour is not engaged in by choice.
The gratification derived from the behaviour is short-lived.
The person experiences strong feelings of regret or guilt afterward.
In North America, a retail theft is committed every five seconds
Fuck me, this is crazy
Shrinkage
industry term for inventory and cash losses from shoplifting and employee theft.
Counterfeiting
Companies or individuals selling fake version of real products
Anticonsumption
Actions taken by consumers that involve the deliberate defacement of mutilation of products
Examples: Product tampering, graffiti on buildings, boycotting a brand, destroy billboards and other ads
Two ways for marketers to collect information
By collecting:
1) Primary data
2) Secondary data
Primary research
Research conducted to specifically address the research question at hand
Secondary research
Research conducted by another party that can be utilized or applied to the research question at hand
Primary research methods
Surveys, focus groups, interviews, observational research, qualitive methods, and experiments
Consumer insights
Drawing important information about the consumer in ways that probe deeper to understand the underlying motivations for a given behaviour, as opposed to simply just observing or describing what consumers are doing
Survey Research
A survey is a method of data collection in which the respondents self-report answers to a set of questions posed by the researcher.
The most common forms of surveys include written surveys, online surveys, and phone surveys.
Allows for vast and expansive collection, but limited and not as rich answers
Focus groups
Focus groups usually involve small group sessions with approximately 6 to 12 consumer participants.
The session is guided by a moderator who leads a group discussion involving a product, concept, or marketing message.
Elicit rich and detailed answers, but social influence can playa role, dampening the expression of consumers’ true individual attitudes
Interviews
One on one interaction with an interviewer and respondent
Good if topic is embarrassing, sensitive, or polarizing
Time consuming, expensive,
Observational research
Directly watching behaviours in a natural context (at a mall) or a controlled setting (lab that watches children play)
This is the purest measurement as it measures real behaviours
Qualitative research
Tends to tap into the more subjective, experiential, and narrative aspects of the consumption experience.
Story telling - asked for an anecdote about their experience
Role playing: consumers are asked to be in a particular role and act out how they would respond to a particular marketing stimulus
Photos / pictures: Of their experience with the product
projective techniques
These involve the presentation of an ambiguous, unstructured object, activity, or person that a respondent is asked to interpret or explain
Experimental research
A final research technique involves conducting experiments, which are used when the researcher wants to make cause-and-effect claims
random assignment
This means each person has an equal chance of ending up in any of the experimental conditions
Summary Of The Chapter
Here we go boss
Why consumer behavior is a process?
Consumer behaviour is the study of the processes involved when individuals or groups select, purchase, and use or dispose of products, services, ideas, or experiences to satisfy needs and desires. A consumer may purchase, use, and dispose of a product, but these functions may also be performed by different people.
Marketers must understand the wants and needs of different consumer segments.
Market segmentation is an important aspect of consumer behaviour. Consumers can be segmented along many dimensions, including product usage, demographics (the objective aspects of a population, such as age and gender), and psychographics (psychological and lifestyle characteristics). The importance of relationship marketing means that marketers are much more attuned to the wants and needs of different consumer groups over the long term.
Our choices as consumers relate in powerful ways to the rest of our lives.
Marketing activities exert an enormous impact on individuals. Consumer behaviour is relevant to our understanding of both public policy issues (e.g., ethical marketing practices) and the dynamics of popular culture.
The Internet has transformed the way consumers interact with companies and with each other. Online commerce allows us to locate obscure products from around the world, and consumption communities provide forums for people to share opinions and product recommendations
Marketers must be aware of consumer trends.
As society changes, so too does consumption. More recently, we have seen movement toward more of a sharing economy, preferences for simplicity, anonymity, authenticity and personalization, growing recognition of the importance of diversity, and a focus on health and wellness, just to name a few.
Ethical issues in marketing and consumer behaviour are important.
Society is placing ever-growing emphasis on the importance of ethics in business practice. Many organizations and associations create and follow rules of conduct that demonstrate the importance of values such as honesty, fairness, respect, and integrity.
Many firms have focused on increasing their actions through corporate social responsibility efforts as well as green and social marketing campaigns.
There is a “dark side” to some behaviours that can have negative impacts on consumers and society.
Consumer behaviour can also have a “dark side,” which includes outcomes such as addictive consumption, compulsive consumption, and illegal activities.
Many different research methodologies can be used to understand consumer behaviour.
Primary research is research that is conducted specifically to address the research question at hand. Secondary research refers to research that has been conducted by another party and can be applied to the research question at hand.
While the majority of consumer research has traditionally been conducted using surveys, a number of other research methodologies are being used by marketers that seek consumer insight