Preparation to the exam

Question 1

Anchoring

Answer 1

Anchoring is a particular form of priming effect whereby numerical judgments tend to be influenced by prominent numbers that are available in the context. These prominent numbers – called anchors – need not even be relevant to the judgment.

Question 2

Endowment effect

Answer 2

Directly related to loss aversion (people do not want to lose what they already have), the endowment effect illustrates that the mere ownership of goods makes people prefer a certain thing more than another. This means that a random allocation of goods may determine people’s preferences, as they do not want to give up what they already have.

Question 3

Priming

Answer 3

The term priming refers to activating particular associations in memory just before carrying out an action or task. For example, a person who sees the word “yellow” will be slightly faster to recognize the word “banana.” This happens because yellow and banana are closely associated in memory.

Question 4

Loss aversion

Answer 4

People don’t want to lose what they have already

Question 5

Default options

Answer 5

default option - an option that is selected automatically unless an alternative is specified.

Question 6

Social proof

Answer 6

Social proof, also known asinformational social influence, is a psychological phenomenon where people assume the actions of others reflect correct behavior for a given situation. This effect is prominent in ambiguous social situations where people are unable to determine the appropriate mode of behavior, and is driven by the assumption that surrounding people possess more knowledge about the situation.

Question 7

Reciprocity

Answer 7

Social proof, also known asinformational social influence, is a psychological phenomenon where people assume the actions of others reflect correct behavior for a given situation.

Question 8

Authority

Answer 8

Authority – the factor which influences the attitude and behavior of a consumer towards a product by presenting positive authoritative opinions about it by famous person or company.

Question 9

Scarcity

Answer 9

Scarcity the relative availability of a particular product. If a product is considered to be scarce and unique, one is likely to find it more valuable than other more common goods. Consequently, price for scarce goods is usually higher.

Question 10

Anchoring (examples)

Answer 10

Two goods, and one of them is more expensive (iPhone 6 and 6s)
To show new price and old one (discount)

Question 11

Endowment effect (examples)

Answer 11

• Mugs and pens (exchange)

- Car for 17500 with radio vs car for 17000 and radio for 500

Question 12

The “triune brain”

Answer 12

The “triune brain” is the
hypothesis of neurologist Paul
MacLean and he proposes that
evolution has adopted a policy
of building more advanced
brains on top of older, more
primitive brains, rather than
redesigning from scratch.

Question 13

Three components of triune brain

Answer 13

• Reptilian (survival instincts)
• Mammalian (Emotion, connection, rewards)
• Neocortex - Thinking brain (rational thinking)

Question 14

The main difference between system 1 and system 2 by Kahneman

Answer 14

System 1 = automatic system (intuition)

System 2 = effortful system (reasoning)

Question 15

Explain an experiment with jams by Iyengar and Lepper

Answer 15

More jams offered meant
more people tried
the different flavours
but less people
actually chose/bought
the jam!

Question 16

Opt in vs opt out (Default effect)

Answer 16

opt-in system:
people need to tick the box if they want to join – people don’t take action and don’t join!
opt-out system: people need to tick the box to unjoin – again,
people don’t take action and in this case, they stay joined

Question 17

COMPROMISE EFFECT

Answer 17

When people choose between three options that vary along two dimensions, the option in the
middle (which is average on both dimensions) tends to get chosen more often.

Question 18

The main elements of liking theory

Answer 18

• Using famous people in ad campaigns
• Friendly/attractive service personnel
• Sales people adjusting to the client (we like people similar to ourselves)
• The company’s “About Us” page on the website, humanizing qualities of
  managers and employees, such as hobbies they enjoy.
• humor

Question 19

Herd behaviour

Answer 19

Inevitably, the environment around us
influences our behaviour.
In particular, we take notice of how
others around us behave and/or
have behaved before us. (Example graffiti)

Question 20

Commitment and consistency in consumer behaviour

Answer 20

you like to be consistent (brand loyal)

Question 21

seven approaches from the brand

management

Answer 21

The economic approach
The identity approach
The consumer-based approach
The personality approach
The relational approach
The community approach
The cultural approach

Question 22

The economic approach

Answer 22

the brand as part of the traditional marketing mix.

Question 23

The identity approach

Answer 23

the brand as linked to corporate identity.

Question 24

The consumer-based approach

Answer 24

the brand as linked to consumer

associations.

Question 25

The personality approach:

Answer 25

the brand as a human-like character.

Question 26

The relational approach

Answer 26

the brand as a viable relationship partner.

Question 27

The community approach

Answer 27

the brand as an essential point of social

interaction.

Question 28

The cultural approach

Answer 28

the brand as part of the broader cultural context.

Question 29

three wave of branding

Answer 29

1. wave – the basic rational promises
2. wave – appealed emotionally
3. wave – appeals to the higher level of
   consciousness ‐ the spiritual or the ethical.

Question 30

HOW CREATIVE TECHNIQUES

AFFECT THE BRAIN

Answer 30

1 STORYTELLING
2 SURPRISE
3 PARTICIPATION
4 MUSIC AND OTHER SENSES

Question 31

6 powerful stimuli for the „old brain“

Answer 31

Self-Centered
Contrast
Tangible
Beginning and End
Visual
Emotion