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Consumer Behavior (mktg 211) > Midterm 2 > Flashcards

Midterm 2 Flashcards

1
Q

Do attitudes predict behavior?

A

No: I.e. people think pollution is a serious threat but few do anything about it

Yes: when

  • they are more accessible
  • they are more specific
  • consumers are knowledgeable about the domain
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2
Q

cognitive consistency (theory of persuasion)

A
  • consumers value coherence among their cognitive structures (since we store so much in LTM, we need to simplify concepts)
  • thus consumers want to maintain consistent attitudes
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3
Q

Self perception theory (Theories of cognitive consistency)

A

people observe their own behavior and infer their attitudes from that behavior

  • I.e. foot in the door technique: small request.
  • > large request
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4
Q

Heider’s balance theory (Theories of cognitive consistency)

A

people modify some attitudes to make them balanced with the rest of their attitudes

-consumers have triads if relations they want to keep in balance (you, perceptions of attitude object (I.e. friend), perceptions of some other object (I.e. a celebrity)

I.e. celebrity endorsement: consumer likes tiger woods and thus likes Nike (can be reversed)

tends to work when

  • low involvement products
  • celeb-brand fit
  • as long as the celebrity is liked
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5
Q

Elaboration likelihood model (theory of persuasion)

A

2 routes of persuasion

  1. Central (systematic): attitude change based on careful and effort full analysis of arguments presented in a message
  2. Peripheral (superficial): attitude change based on simple reactions to superficial cues in message (easily processed)

Process
Attend to advertisement-> motivation to elaborate
-if low involvement-> peripheral-> peripheral persuasion if periph. Cue is present (no persuasion if not
-if high involvement-> ability to elaborate
(if low ability: peripheral route)
(If high ability: central route-> elaboration on argument (if weak: no persuasion, if strong: favor, oppose, or neither/go to peripheral))

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6
Q

Central route (ELM)

A

Arguments drive persuasion

Types of elaboration on message argument

  • source derogation
  • counterargument
  • support arguments

Must provide strong arguments through

  • facts
  • evidence
  • reasoning
  • logic (I.e. celebrity fits logically with brand/ emotional appeals can work as long as they are related to product)
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7
Q

Peripheral route (ELM)

A

Persuasion depends on

  1. Source (communicator)
    - attractiveness/likability (halo effect)
    - credibility/trustworthiness
    - expertise
  2. Message
    - length (# of arguments)
    - emotional appeals (I.e. happiness in ad)
    - pleasant stimuli: music/visuals
    - self referencing
    - repetition: increases like ability (mere exposure) and believability (truth effect)
  3. Channel: I.e. multiple sources/ad placements increases believability of claims

Note: these cues influence persuasion independent of the arguments presented in the message

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8
Q

Celebrity endorsers (ELM)

A

What makes a good celebrity endorser

  1. Celebrity-audience fit
  2. Celebrity-brand/product fit
  3. Positive traits of celebrity

Centrally: need logical fit between celeb and brand to prevent certain types of elaboration (source derogation or counterargument)

Peripherally: celebrities attributes will be persuasive

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9
Q

When to use central or peripheral (elm)

A

use central route: If consumers are motivated to elaborate (high involvement) and you have compelling arguments

Use peripheral route “: if consumers are unmotivated to elaborate or you have a weak argument

-ideally design for both

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10
Q

How does post purchase satisfaction affect consumer behavior?

A

Effects of satisfaction

  • repeat purchase (customer acquisition cost 5x more than retention)
  • positive WOM

Effects of dissatisfaction

  • switching behavior
  • negative WOM
  • returns
  • tends to be enduring (loss aversion)
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11
Q

Procedural justice theory

A

Centered around the purchase process

-premised around notion that process should be fair regardless of outcome

distinction between

  • satisfaction with outcome
  • satisfaction with process(shopping experience) leading to outcome

Firms must worry about both product and shopping experience

  • treat consumers fairly (consistent)
  • explain procedure clearly (transparent)
  • give customers a voice (opp. To express opinions)
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12
Q

Expectancy disconfirmation theory

A

Centered around expectancy confirmation

Dissatisfaction when: expectations>actual performance

Satisfaction when
-expectations=actual performance

“Will” expectations (controllable by firm) vs “should” expectations (rarely controllable by firm)

Implications for firm

  1. Align will and should expectancies
  2. Set accurate will expectations
  3. Communicate consistent messages (consistency across channels)
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13
Q

Attribution theory

A

Centered around attributions of cause

Satisfaction with brand is determined by where consumers attribute blame to a failed service (company, self, uncontrollable factors)

3 factors of satisfaction (higher dissatisfaction left to right)

  1. Focus: who’s at fault (me, bad luck, firm)
  2. Stability: will this happen again (once, all the time)
  3. Controllability: was it within the firms control (no, yes)

Firms manage satisfaction by

  • minimizing the number of things where blame can be attributed to brand (I.e fix flaws in product design)
  • if you are to blame, reduce expectations of future failures by reframing bad experience as unstable and uncontrollable
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14
Q

What do customers do when they’re dissatisfied?

A
  1. Complain to firm
  2. Avoid firm
  3. Take overt actions (negative WOM or encouraging others to boycott)

Sometimes the worst thing to hear from a dissatisfied customer is silence

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15
Q

Measuring consumer satisfaction

A
  1. Surveys (Likert scale: agree-disagree, number rating system or ask about willingness to refer to others)
  2. Net promoter score (promoters-detractors): divide people up into
    - promoters (those who rate 9-10)
    - passives (those who rate 7-8
    - detractors (those who rate 6 or less)
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16
Q

How to improve satisfaction and NPS

A

Recognize that dissatisfaction is not driven by one thing and create a journey map that describes how a purchase is made and where satisfaction can go awry

Steps

  1. Identify consumer segments and personas
  2. Map the journey
  3. Identify the company side factors that affect satisfaction
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17
Q

The trigger (problem recognition stage 1)

A

Triggered to buy something when we perceive a need (perceived diff between actual and ideal state)

What determines our ideal state?

  • expectations
  • aspirations
  • life changes

What creates perceived need?

  • depletion
  • situation changes
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18
Q

Consideration set (problem recognition stage 2)

A

The subset of available options that are evaluated as potential choice options

awareness sets are large but consideration sets are quite small (evaluating many options is too effortful)

When do we economize?

  • when a cost of a mistake is low
  • when we have low need for variety
  • when retailers restrict variety

How do we economize?

  • learning from prior choices
  • exploiting similarities among options
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19
Q

Formation of the consideration set

A

-formed by unknown brands (found accidentally) and familiar brands evokes from LTM (most prominent)

Factors that determine which brands are evoked from LTM

  • prototypicality
  • familiarity
  • episodic/autobiographical experiences
  • preference
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20
Q

How can marketers influence initial consideration sets?

A
  1. Have consumers “accidentally discover brand
  2. Get brand into consumers evoked set
    - organize shelf placement
    - end of aisle displays
    - allow consumers to develop customized options
21
Q

Active evaluation/info search (stage 3 of problem recognition)

A

Searching for info about alternatives (new options to add into set and options to take out/ editing stage)

Includes

  • unknown brands found accidentally (external search)
  • familiar brands from evoked set (internal search
  • unknown brands found through intentional search (external search)
  • note: consumers mostly stick to initial options

What determines how much one searches?

  • cost of making a mistake
  • cost of search
  • felt involvement
  • need for cognition

External search

  • online
  • word of mouth
  • sometimes not accurate (confirmation bias:Hannah study: consumers search for info in a way that confirms prior beliefs)
22
Q

Weighted additive model (compensatory rules for high effort)

A

-multi attribute model: assumes that consumers form preferences for products by allocating specific weights to different attributes

Attitude toward brand b (A sub b)= sum of importance of attribute i (i.e. quality) (I sub i) x belief about the desirability of b on that attribute (I.e. consumer assessment of quality) (B sub ib)

-values are subjective and even if brand b is poor on one attribute, consumers may still have a positive attitude towards b if it has other good attributes

as firm owner you can try to

  • improve brand’s desirability on attribute i
  • reduce importance of inexpensiveness attribute
  • add a new compensatory attribute

Marketers encourage consumer to evaluate in this way by using brand attribute matrices (I.e. attribute checklists)

-also have consumers rate importance of each attribute and the desirability of each brand on each attribute.

23
Q

Additive difference model (compensatory rules for high effort decisions)

A

Formation of pairwise comparisons of attributes like a tournament
-can be weighted or unweighted

I.e. compare Samsung vs kindle. Based on different attribute and take the sum of each pair.

24
Q

Problems with direct assessments of attributes or alternatives

A
  1. People may not have good insights into their own preferences
  2. People may not want too reveal their preferences
25
Q

Conjoint analysis

A

Infer importance by observing how people’s preferences for alternatives change as attribute values have changed

(I.e. find out that quality or atmosphere of a restaurant matters to consumers by changing values on those attributes)

26
Q

Non compensatory rules

A

Decision policies that consider only a subset of all available info without making trade offs.

  • used early on the choice process to screen alternatives
  • used later in the choice process to decide between finalists

Types
1. Conjunctive: option is chosen if it’s above some threshold on all of a set of important attributes ( I.e. admit students if they meet a minimum gpa and sat score)

  1. Disjunctive: an option is chosen if it is above some threshold on at least one of a set of important attributes (I.e. Olympic team)
  2. lexicographic: choosing the option that is the best on the one most important attribute

Used when

  • in a hurry
  • choices are too complex
  • only one attribute matters
  • as a tie breaker when 2 choices are equal
27
Q

Biases in multi-attribute evaluations

A
  1. Choice set effects: items are made more appealing when compared to an inferior or flawed object
    - I.e. simonson and tversky experiment: 36% chose cross pen rather than getting $6 but 46% chose cross pen vs $6 when a less attractive pen was included in the choice set
  2. Anchoring effect: When asked to form an inference about an uncertain quantity, we start with an initial impression and adjust off that number
    - summary: evaluations of attributes may be biased by other information in task
28
Q

Low effort decision making

A

Based entirely on heuristics

What leads to it?

  • we are cognitive misers
  • we have low MAO
  • people differ in the degree to which they are satisficers ( seek good enough options) vs optimizers (seek the best option)
    - satisficers are more likely to engage in low effort decisions
    - optimizers May lead to better objective outcomes but not subjective ones because
    1. Rumination
    2. Reminders of opp. Cost
    3. Regret
29
Q

How do heuristics get learned?

A

Heuristic-> choice-> usage (experience) -> outcome:reinforcement (reward vs punishment)

-learning determines whether we use the heuristic again

High vs low effort

  • high effort: use of non compensatory rules (heuristics) often operate through central route
  • low effort: operate via system 1 processing
30
Q

Familiarity heuristic

A

Choice is made based on whether an option is familiar or seems similar to previous choices

-assumes that ones past choices were correct

Marketing implications
-increases the likelihood that customers will repeatedly buy the same brand

31
Q

Availability heuristic (base rate neglect)

A

Judgment of the probability of an event occurring is influenced by the ease with which past instances of that event can be recalled

-I.e. people think that they have a higher chance of winning the lottery because they see lottery winners (neglect base rate info)

Marketing implications

  • make the benefits of product vivid so that they’re easily recalled and seem more believable
    1. Provide vivid descriptions of positive product experiences
    2. Encourage customers to imagine benefits from product
    3. Stimulate positive WOM (truth effect)
32
Q

Non independence of events heuristic

A

Belief that past frequency affects future likelihood for statistically independent events (I.e. gamblers and hot hand fallacy)

33
Q

Representativeness heuristic

A

An event seems more likely if it more closely resembles similar predecessors
-I.e. generic brands look like big named brands

34
Q

Default/status quo heuristic

A

When people aren’t motivated to choose among a set of options they go with the default

Marketing implications

  • customers will stick with the firms pre selected default option
  • firms leverage defaults by
    1. selecting their default option strategically
    2. providing implied defaults by recommending an option (I.e. best value option)
    3. creating implied defaults by drawing attention to a specific option
    4. using introductory offers
35
Q

Choice overload

A

When the heuristic is to not buy at all

-I.e. jam study and 401k study: people with too many choices buy less

36
Q

Social exchange theory (brand loyalty) part 1: cost-benefit

A

People evaluate the value of a relationship according to the rewards and costs which correspond to the positive and negative things derived from the exchange (minimize costs and maximize benefits)

Value of relationship is determined by

  1. Subjective cost benefit analysis (value=benefits-costs)
  2. Comparing worth vs expected worth
  3. Comparing worth vs worth of available alternatives
37
Q

Social exchange theory part 2: fairness

A

People also seek out relationships that are fair

  • resentment if my costs>firms costs or my rewards< firms rewards
  • guilt if my costs firms rewards

What makes a price fair?

  1. Comparison to alternatives (competitions price or price paid by other customers)
  2. Comparison to expectations (past experience or pricing norms and procedure: for some products price fluctuations are normative)
    - but within reason: want buyers cost/benefit ratio to be proportionate to seller’s CB ratio
38
Q

The relationship and human relationships metaphor (brand loyalty)

A

Brands as a religion or seen as a relationship with spouse or close friend

Brands can be

  • part of self identity
  • give life meaning
  • are top of mind
  • create passion
  • have an autobiographical history
39
Q

How firms can manage brand loyalty

A
  1. Mechanically keep customers in loyalty loop (I.e. amazon dash button
  2. Discounts
  3. Targeted offers
  4. Cumulative points (I.e. punch cards or rewards points)
    - goal gradient effect: perceptions of progress impact one’s motivation to pursue ones goal (the closer you are to a goal the harder you work to attain the goal)
    - I.e: head starts in point program

Downsides

  1. Over justification: people attribute their choice behavior to the reward not the o reinsurance value of option
    - I.e. I buy this for the discounts not Bc I’m loyal
    - explained by cognitive dissonance
40
Q

Cognitive dissonance

A

an unpleasant state of arousal that results when cognition and behavior are in conflict
- we reduce dissonance by changing thoughts, behavior, attitudes or rationalizing the conflict

Studies

  1. Insufficient justification study:tension between attitude and desire to maintain self concept led people to change their attitude toward boring tasks if payed $1 to say it was fun
  2. Post decisions dissonance: when people chose between a good and bad product their ratings about how much they liked each product remained unchanged, but when they chose between 2 equal products their ratings changed ( “the reason I chose it must have been because it was better”)
41
Q

Downsides to loyal customers

A
  1. Expect more and better service
  2. Demand lower prices
  3. Less likely to spread WOM
  4. Firm May over invest in them
42
Q

Why are social influences so strong?

A

Groups provide

  • safety
  • support systems
  • norms

Different desire in response to group norms can impact our behavior: desirability to fit in vs desire ability for uniqueness

-I.e. desire for conformity: asch line study

But the way we perceive ourselves in relation to the group can also impact our behavior (self perception)

43
Q

Self perception in relation to groups

A
  1. False consensus effect: tendency to see own behavior as typical and to assume others will behave the same way (justifies bad behavior/safety in numbers)
  2. False uniqueness effect: the tendency to overestimate ones own uniqueness in social comparisons
  3. Spotlight effect: we often believe that people pay more attention to us than they actually do (I.e. Barry Manilow study)
44
Q

Compliance tactics to exert social influence

A
  1. Reciprocity (I.e. giving people a mint with their bill, free samples, “gifts”)
  2. Liking: customers are more likely to comply with requesters that they like
    - associate brand with well liked figures
    - sales rep can establish similarity with customer (I.e. Tupperware parties)
  3. Authority: experts provide shortcuts to decisions requiring specialized info (use of diplomas and uniforms)
  4. Scarcity
  5. Social proof: we determine what is correct in part by finding out what others think is correct
45
Q

Social media as a platform for social influence

A

good Reviews translate to more sales online

Social media has created and environment where we increasingly engage in public consumption (makes us susceptible to social influence and more influential to others)

  1. Social media is targeted (firms can target certain customers to benefit from “network effects”/ user to user influence)
  2. Social media can exert different types of social influence (normative, informational, emotional)
46
Q

Types of social influence on social media

A
  1. Informational influence: others are seen as sources of information, thus we change our attitudes based on info from others
  2. Normative influence: we act in ways consistent with group norms because of the implicit reward and punishments controller by group
  3. Emotional influence: we compare our feelings attitudes and behaviors to those of other people (aspirational/upward and ego/motivational/downward)
47
Q

Structure of a social media campaign

A
  1. Seed a message in the hopes that it spreads (on SM the cost of grabbing attention is low and you rely on the initial consumers to do the job for you)
  2. Identify tactics that maximize spreading (viral videos)
48
Q

What make people watch ads?

A
  1. Unexpectedness
  2. Emotionality
  3. Story arcs
  4. Simplicity and concreteness
49
Q

What makes ads go viral?

A

Content with

  1. Triggers: things that spark the urge to share
  2. Active emotionality: evoke emotions that trigger us to take action
    - high arousal positive and negative emotions cause sharing (I.e. happiness, anger anxiety surprise)
  3. Social capital: we share to make us look cool

Consumer Behavior (mktg 211) (2 decks)

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