Extra Lecture Notes Flashcards
one can see input goes into black box and see output comes out but
cannot see what processing happens inside the black box
as marketers/business managers, we know that the black box
is being affected by al kinds of external stimuli
brand name, 4P’s, etc.
what do see within a fraction of a second or after days or possibly after years?
the buyer’s response
what they think of the brand, whether they buy the product or not, etc.
not only do we have to study all the stimuli entering the black box and the buyer’s responses, but also
we have to understand what’s happening in the black box
the challenge of consumer behavior
infinite/mysterious
what does consumer behavior study?
delves deep into cogs and wheels of buyer’s minds (heart, emotion etc)
why should we study consumer behavior
consumer scientists believe that of everything in the universe…customers are the center of the universe
if companies do not understand their consumers
they will fail
what is the giant C word
Consumer
parent of a child nd you want them to drink more milk: do you give them the tall/skinny glass or short/wide glass?
wide/short
why?
because the child is self-pouring and this glass seems like they have to drink les. the tall glass looks like too much. they will consume more milk in the short glass without them realizing that.
74% more juice was poured and consumed when consumers (12-17)
poured the juice in the short wide glass
if youre pouring a cocktail, which glass would you use?
skinny/tall
gives consumers perception they drank more of the alcohol and are getting a god value when they didn’t
if youre a restaurant manager at an all you can eat buffet and you give out glasses, which should you give out for your glasses
skinny/tall to reduce waste/consumption in self-serve restaurants
3 things we need to study as consumer behavior scientists
how consumers obtain products and brands
how consumers consume (how often and why)
how consumers dispose (throw away? donate? recycle?)
consumption analysis
sub area of consumer behavior
why and how people USE products in addition to why and how they BUY
when the size of tide detergent package is small…
…the consumer pours out 220 milliliters of tide liquid per wash
when the size of the tide package is larger…
…consumers pour 240 mL of same load in same wash
why? bc consumers believe they have a bigger package so that means they have enough to use extra–not the case with small package
package size influences
consumption of products
–want people to buy and consume larger packages (not w bleach tho cause ppl dont like using too much bleach)
-depends on a brand by brand and product by product basis
jelly bean consumption increased by
137% when served in 24 colors compared to 6 colors
the more variety equals
the more ppl will snack/consume
studies showed the honda civic segment was the
teenage terror segment
studies showed the honda accord segment was the
recent MBA grad segment
studies showed the toyota sienna mini van segment was the
subarban mom segment
studies showed the cadilac sts segment was the
mid-career executive
studies showed the lexus ls 430 segment was the
titan of industry segment
what are uncontrollable variables?
enviornmental variables
- economic
- technologial
- political
- cultural
- demographic
- situational
what are controllable variables?
marketing mix
product
price
place
promotion
consumer influences and organization influences will influence how consumers…
(the entire spectrum of consumer behavior)
obtain the product
consumer the product
and dispose of the product
Why Study Consumer Behavior?
everyday an election is being held on consumers (with their dollars) on which brand/companies win
-macroeconomic level (will China have more jobs or Europe)
consumer behavior determines the economic health of a nation as well as the success of a marketing program
in the US, consumers are responsible for
70% or more of the nation’s economy
consumer decide which marketing program should be oriented
in which direction
the responsibility of consumer behavior also exists for
demarketing programs
Sam Walton said
Only the customer can fire us all
not exactly demartketing but in the same vein—
campaigns showing as consumers, we have to change how we dispose of products that we finished consuming–we have to recycle more
got milk campaign
one of the most powerful/successful marketing campaign
mustache campaign
began in the 80s
used familiar celebrities in each country
companies throughout the world are shifting towards healthir options–why?
consumers are worried about obesity
subway has become a
#1 fast food selling franchise (most outlets around the world) --overtaken mcdonalds a few years ago
–how? their east fresh campaign after doing market research their was a compelling need for healthy options
-Jared Fogle was a big tool in helping Subway succeed in their campaign
consumer behavior has the responsibility to educate consumers about
health
when consumer behavior affects personal policy, that is at the
individual level
how does consumer behavior affect personal policy
your quali
your quality of economic life (standard of living) is determined by
your personal policy, which in turn is strongly influenced by your consumer behavior
studies show that its not as important how much money you make in your lifetime but more so
how much you save, how frugal you are, etc
one of the most popular consumer research methods
observation techniques
observations can be ___ than surveys
economical/cheaper
shadowing is a very ___ consumer research methodology
common
observation research methods are called that bc
you don’t have to ask people questions
one of the most important research methods besides observations
surveys/interviews
surveys are the most
widely used methodology
surveys are not always reliable bc
ppl can lie
what is the advantage of surveys
you can ask people why they did something, info you cant get just from observations
the third most common consumer research methodology
experimentation
lab experiment
lab mock up (artificial) to replicate/simulate the real shopping experience
–more biased bc ppl behave differently when they know they are part of a lab experiment, but they are cheaper
field experiment
you get the cooperation of the actual store to conduct your exp in their store
–more realistic; more expensive
until we can understand as marketers how consumers use our products and why they use our products
we can never improve our products or introduce successful new product
every new product is backed by
consumer behavior research
4 foundations on which consumer behavior is based on
- The Consumer is Sovereign (understood worldwide)
- -the be all, the end all, the start of everything that has to do with business - The Consumer is Global (the world is shrinking)
- -consumer behavior has to be studied at a global/cross-cultural level - Consumers are different; Consumers are alike
- -we have to recognize that consumers are different (diff segments, parts of the world, etc.)
- -they behave differently
- -many consumers even from diff segments do have a lot of overlapping behaviors - The Consumer Has Rights
- -may differ by countries and cultures
customers may look different but
behave/respond in similar ways
customers may look the same but
behave/respond completely different
the consumer bill of rights was proclaimed and announced in the USA by
John F Kennedy (1962)
what is the takeaway of the coca cola story?
consumers also buy products due to emotion/loyalty to the brand
–dont forget to measure the emotion behind a brand
how does the prototypical consumer make his or her decision?
(decision process) Need Recognition Search for Information Pre-Purchase Evaluation of Alternatives Purchase Consumption Post-consumption Evaluation Divestment
Need Recognition/Problem Recognition
the consumer must recognize a need to solve a problem (another way of saying this is to buy a product)
Search for Information
consumer research products that could solve their problem
Pre-purchase Evaluation of Alternatives
Consumer then collects, organizes, and processes all the information that they have gathered and does an eval of all the alts.
Purchase
when the consumer decides to buy or not buy
–the most critical stage for the marketer
Consumption
how, when, how much, why consumers consume
Post-consumption Evaluation
how does the consumer evaluate the product either consciously or subconciously
Marketers have to know how to mitigate, reduce, and manage…
…negative evaluation and encourage positive post-consumption evaluation
Divestment
how does the consumer get rid of the product? what do they do after they’ve completed consumption of the product?
Need Recognition is the very first…
…step in any consumer behavior process.
As human creatures, we are…
dissatisfied, or we are always in a state of dissatisfaction OR at the subconscious level, we are always looking/striving for something better
just bc you are dissatisfied with what you have or wish you had something better…
…this does not trigger need recognition
—only when the “gap” becomes bigger is need recognition is triggered (like a rubber band that snaps)
memory of how bad the situation is plus memory of ads that could solve your problem affect your
need recognition
symbolic needs are products you buy and consume often…
subconsciously
is it possible to buy products to fulfill both symbolic and functional needs?
yes
internal search is retrieved
quickly and subconsciously
external search is performed
consciously : going online, reading reviews, etc.
two types of stimuli
marketer dominated
non marketer dominated
information processing stage includes 5 substages
Exposure Attention Comprehension Acceptance Retention
Exposure
the consumer is exposed to relevant ads and stimuli
Attention
have to make sure consumer will pay attention to ad
Comprehension
have to make sure consumer will understand the ad
Acceptance
even if understood, have to get consumer to accept the message
Retention
have to get consumer to internalize that message (even if understood and believed)
ads that create a brand image are
wanting to fulfill a void in symbolic needs
55% of ppl intentionally carry their smartphone while shopping so they can
comparison shop
40% of ppl said they had changed their mind about purchasing in-store based on
info found online while shopping
Evoked Set/Choice Sets
the short number of brands that each one of us in our minds that we carry around all the time
if you say deodorant, I think of the brand Secret
the final short list of brands that a consumer seriously considers buying from, even if they may be aware of 15 different brands
purchase intention can influenced even at the
very last minute (also known as the 13th hour)
the way that a consumer consumes a product largely determines…
…product satisfaction or dissatisfaction
–involves user error, very common in tech products
one of the most dangerous things a company can go through is when
the consumers suffer through the consumption experience, which leads to negative product evaluation
–need to be given the right instructions/info
an ad with an emotional appeal may be catering to…
hedonic and/or symbolic needs
another term for cognitive dissonance/post-purchase regret
buyer’s remorse
traits used to separate for target and positioning
individual differences:
demographics, psychographics, values, personality, behavior
consumer resources
some ppl have more or less money, some have cash, some have credit
time is also a resource
brain power (cognitive resource) is also a resource
you can be motivated differently depending on
what decision you are making
knowledge
diff consumers have diff levels of knowledge on the decision they are about to make
attitudes
you can have diff attitudes with different product categories, diff brands, etc.
one of the most important influences of consumer behavior
culture
-that’s why we have entire subjects and topics called cross-cultural influences/cross-cultural marketing
personal influence
you as a person interacting with the environment in diff ways
situational behaviors
how do you respond to situations depending on diff environmental forces that are always impacting you?
aspirational reference groups
groups you want to belong to–the opposite of membership groups
membership groups
groups that you are a member of that influence your behavior
the cdp can be mapped on a continuum
extended problem solving (highest and most complex level) limited problem solving routine problem solving (lowest and least complex level)
habitual decision making
when routine problem solving becomes a habit–becomes instinctive
what is the opposite of habitual decision making?
impulse buying
least complex form of limited problem solving
impulse buying
idea of brand inertia comes from
newton’s law of motion
brand loyalty v brand inertia
loyal to colgate? i will go to multiple stores to buy colgate
inertia to colgate? i always buy colgate, but i will buy another brand if colgate is out of stock
Pre-Purchase Processes
Need Recognition
Search
Evaluation
some consumers believe I am what I buy…
…others believe I buy what I am
–both can be true
if the degree of discrepancy at or above a certain threshold
need recognition is triggered
desired state can be increased even when consumer is completely happy with their product due to
new products and innovations being introduced to trigger need recognition
need recognition does not just depend on depressing actual state or increasing desired state, but also by accessing
the hidden desire/latent need
is most advertising generic or selective
selective
pre purchase search vs ongoing search
more focused vs passive
t/f
marketers must understand what consumers are searching
t
ppl are more likely to believe
family and friends (non biased interest) over salespeople (biased interest)
the less a consumer knows about a product category…
…the more they are willing to search
subset of awareness set
consideration set/evoked set/choice set
if you want a product to be evaluated a certain way…
…you put it on the shelf next to similar products
heuristics
a subconscious shortcut a consumer uses to make decisions
–ex: prefer to buy generic vs private label
during the piecemeal process, consumer are subconsciously setting up two restrictions:
cutoffs
signals
piecemeal process can be done
consciously or subconsciously
lexicographic strategy
certain segments of consumers evaluate brands by comparing them initially on the most important attribute (to the self)
one of the most popular/most common segmentations
demographics
demographers
consumer analysts
next best thing to measuring behavior is
proxy/leading indicator of behavior
there is a ___ ___ that links all nations/demographics together
butterfly/ripple effect
Demographics need to be studied in 4 different pillars
Changing Structure of Markets
Geographic Factors
Economic Resources
Global Markets
the birthrate does not include
infant mortality
if the US has a birthrate lower than 2.1, then how is the population not declining?
because of immigration
US has one of the largest ___ rates in the world
immigration
population momentum does not only depend on the size of the existing population but also
but it will also be the demographic/age distribution of a country
what kind of population will have greater momentum?
> > a younger population with more women at childbearing age
vs
an older population with fewer women at childbearing age
examples of cohorts
age cohorts
geographical cohorts
Xennials
children born in the late1970s–early 1980s
when muppies were young
yuppies
T/F
the silent generation thinks they are younger than they actualy are
T
Generation Alpha
new generation being identified and used in cohort terminology—these are the kids that are just being born now or have been born in the last 10–15 years.
(2010-2024)
The Greatest Generation
(1916-1928) important bc respect -now in their 90s--100s -have seen all the wars and served -lived through the Depression
social classes are not directly related to income classes, but they are…
correlated
fourth and critical stage of the CDP
Purchase
purchase planning is high when it is
important to the consumer
store displays can trigger need recognition, leading to an
unplanned purchase
up to 70% of purchases are unplanned purchases at
supermarkets/grocery stores
3 most important things for retailers to consider
location, location, location
-the most important thing about a retailer’s success is the location of the store
Tar-Zhay
Target
- -sounds French
- -WalMart for the upper class
how quickly a customer leaves the store depends on
the store’s atmosphere
extremely important for enhancing the retail experience
Point of Purchase displays
Pop Units
Yes units
6 Ps
Product Promotion Place Price Presentation (helps with logistics) Personnel/People
Nondiscretionary Time
Obligatory time
ex: taking work home
