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MOS 1021 > Unit 6 > Flashcards

Unit 6 Flashcards

1
Q

Define consumer behaviour.

A

All those activities and all the decision-making that occur when a consumer recognizes needs and then chooses, purchases, consumes, disposes of, and evaluates the ways to satisfy that need.

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2
Q

What are B-Corps?

A

B Corps are for-profit companies that are part of a global movement to use business as a force for good. These firms commit to social and environmental missions as well as traditional profit-making goals.

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3
Q

What influences a purchase decision?

A
  • The purchase of a particular brand or product could be the result of an endorsement by a celebrity or a friend (ie. word-of-mouth endorsements)
  • When making a buying decision, consumers process a lot of information from social media, family, friends, and their own personal experiences
  • Purchases can be based on past experience with the product, or it could be due to the delivery of a free sample or an in-store encounter
  • Customer approaches a purchase decision is determined by the significance the consumer attaches to that decision (this significance is called invloment or consumer involvement)
  • Other important factors, but with lower response rates:
    Quality comparisons with other brands, price, recommendations from others, manufacturer’s reputation, and how well known and well advertised a product is
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4
Q

What are the steps of the consumer purchase decision process?

A
  1. Problem recognition
  2. Information search
  3. Evaluation of alternatives
  4. Purchase decision
  5. Post-purchase evaluation

These steps may not be followed depending on the type of purchase.

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5
Q

What are the models of risk?

A

Routine problem solving (low involvement)
- Consumer invests little time and effort in the decision (considering few or no alternatives, product attributes, or information sources).
- Toothpaste, coffee, razor blades, and deodorant are usually based on product satisfaction.
- No need to follow a prescribed buying procedure.

Limited problem solving (moderate involvement)
- The consumer invests some time and effort in the decision, considering serval alternatives, product attributes, and sources to ensure they are satisfied.

Extended problem solving (extended involvement)
- Consumer invests considerable time and effort in the decision, considering many alternatives, product attributes, and information sources to ensure they make a satisfactory choice.
- Automobile, an extended vacation, smartphone, or major household appliance require a lot of time, effort, money, and a proper evaluation of alternatives.
- It is likely that all steps in the buying process are followed.

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6
Q

What are consumption activities?

A
  • When, where, how, why people use products
  • Not all products have a functional purpose in our lives
  • Instead, the products communicate a message
  • May include symbolic meaning
    Eg. High-end luxury items
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7
Q

Define problem recognition.

A

In the consumer buying process, a stage in which a consumer discovers a need or an unfulfilled desire.

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8
Q

Describe the difference between actual state and ideal state

A

Actual state - “what I would like to have”

Ideal state - “what I have”

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9
Q

Define information search.

A
  • Conducted by an individual once a problem or need has been defined.
  • Motivated to act, the consumer next sets about seeking out information about how they should best solve their problem and satisfy their needs
  • Consumer involvement
  • Two types of information search:
    1. Internal search
    2. External search
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10
Q

Differentiate between internal and external search.

A

Internal:
- Effective when prior knowledge exists
- Memory, past experiences

External:
- No or limited prior knowledge likely
- Commercial sources: have the best interest in influencing our decisions (ex. advertising, most info comes from here)
- Don’t trust commercial sources
- Public sources: comes from 3rd parties (ex. reviews such as yelp)
- They don’t give us info about products
- We tend to trust these more
- Personal sources:
- Friends, family
- Most effective
- Experiential sources: new information we get about a product or service based on new experiences we have with that product or service
- Most effective

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11
Q

Define consumer involvement.

A

Perceived interest and importance that a consumer attaches to the purchase and consumption of a product or service.

If it is a routine and low involvement purchase with little risk, no information may be sought.

If it is a complex and high involvement decision that involves a higher degree of risk, numerous sources of information may be investigated.

As the price and associated risks of the purchase increase, the extent of the search for information also increases.

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12
Q

Define alternatives evaluation.

A
  • Aware of the options available to them, the consumer begins to weigh these options using their evaluate criteria to determine which one(s) is/are most likely to satisfy their needs.
  • Evaluation approaches
    - Compensatory
    - Non-compensatory
    - Heuristics
    - Don’t have to look at different alternatives
    - Loyalty to a brand
    - Branding
  • Consumer don’t consider every aspect of every product, they will tend to focus on the determinant attributes when making their assessments.
  • Consumers are lazy and rational.
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13
Q

Describe awareness set.

A

Awareness Set:
- Evoked Set (Consideration Set) - positive impression
- Inert Set - no impression
- Inept Set - negative impression

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14
Q

Define evoked set.

A

A group of brands that a person would consider acceptable among competing brands in a class of product.

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15
Q

Describe the purchase decision step.

A
  • At this stage, the consumer forms a purchase intention, determining what they will buy to satisfy their need, and then carriers out a purchase action (best alternative has been selected, a consumer is ready to make the purchase decision).
  • The decision of where to buy can be driven by price points, convenience, retail polices, and our own familiarity or experience with the seller
  • The decision of when to buy can be driven by finances, sales and promotions, time pressures, and the shopping situation
  • Incentives are now very common technique to attract prospective buyers
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16
Q

Describe the post-purchase evaluation step.

A
  • Compare product to expectations to assess satisfaction
  • Evaluates outcomes of their decision to inform their future consumer behaviours
  • The purchase of routine ideas is based on past experience and satisfaction (creates a positive, secure feeling after the purchase)
  • Consumers can sometimes grow unhappy (they are uneasy with the choice they made)
  • Other purchases may result in dissatisfaction leading to brand switching, a process involving more purchases and evaluations
  • Dissatisfaction results in cognitive dissonance
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17
Q

Define cognitive dissonance (theory by Leon Festinger).

A

An individual’s unsettled state of mind after an action he or she has taken.

The presence of cognitive dissonance suggests that the consumer is not confident that he or she has made the right decision. This can be overcome by taking certain actions.
Eg. Read online reviews, review the purchase, talk to a friend about the purchase, etc.

The organization should follow-up to ease the customer’s mind.

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18
Q

What influences consumer behaviour?

A
  • The purchase decisions are primarily influenced by psychological, personal, social, and cultural factors
  • Decisions about product, price, availability, and marketing communications are designed to positively influence customers
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19
Q

Define lifestyle.

A

A person’s pattern of living as expressed in his or her activities, interests, opinions, and values.

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20
Q

What is AIOS?

A

AIOS - activities, interests, and opinions.

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21
Q

What is the life-cycle theory?

A

Life-cycle theory is based on the changing needs of a family as its members progress through the various stages (different types of buying occur in each stage).
Marketers tend to define their target markets on the basis of age and life cycle, and devise appropriate marketing strategies suited to particular stages.

22
Q

How does technology influence buying behaviour?

A

Factors are combined to dramatically change the way in which consumers buy goods and services.

These factors include the growing numbers of time-pressed consumers, the availability of information through the Internet and social media networks, and our growing obsession with mobile devices.

23
Q

How does technology affect companies?

A
  • Marketers can monitor where consumers are and what they are purchasing with the amount of data and available technology
  • Retailers can also create detailed consumer profiles and target individual customers
  • The Internet and social media networks offer an effective and efficient means to communicate directly with people and are an essential component of the marketing communications mix
  • Marketers can use location- based targeting
24
Q

How does the current economic situation affect purchase decisions?

A
  • The economy directly or indirectly influences the attitudes, values, and lifestyles of people in Canada
  • The cyclical nature of the economy shapes purchase decisions
25
Q

What results due to a recession?

A
  • Unemployment may be on the rise, and the discretionary income of consumers may be low
  • Major and new purchases will be delayed and consumers will make products last longer
26
Q

What happens due to a boom?

A

Consumers are more likely to purchase more goods and services.

27
Q

How does the economy affect companies?

A
  • An organization will adjust its marketing strategies based on changes in the economy
  • A business organization remains conservative in hard times and is more aggressive in good times
28
Q

What is the “choice overload hypotheses”?

A

Contends that while it might be initially appealing, extensive choice is ultimately demotivational and cognitively taxing.

  • Daniel McFadden argues that extensive choice increases the perception of risk a consumer has and the amount of effort they feel they will need to expend, all of which has a demotivational effect
29
Q

What was the experiment conduced by Lyengar and Lepper?

A

The researchers tested the “Choice Overload Hypothesis” in 2000 by comparing reactions to limited choice and extensive choice in a set of 3 experiments.

  1. “The jam experiment”
    -This first experiment involved giving consumers a limited choice of 6 jams and then an extensive choice of 24 jams at a display booth in a quasi-experiment set in a grocery store.
  2. “The essays experiment”
    - The next experiment involved giving students a limited choice of 6 topics and an extensive choice of 30 topics for an optional extra credit essay assignment.
  3. “The chocolates experiment”
    - This final experiment involved offering onegroup of participants a limited choice of 6 chocolates and another group an extensive choice of 30 chocolates to select from.
30
Q

Where did Iyengar and Lepper find “Choice Overload” to be less likely?

A

Less likely with:
- Higher decision self-efficacy
- Clear prior preferences exist
- We experience positive affect

  • If someone is feeling happy when they are in the purchase decision process, they will not feel overwhelmed with the many choices

Meta-analysis that tested hypothesis found little supporting evidence:
There is limited support for the hypothesis; there is no such thing as too much choice.

31
Q

What are situational influences?

A

Situational influences are those non-enduring and contextual variables tied to a specific time or place that shape a purchase or consumption situation.

Situational influences on consumers:
- Physical surroundings
- Social surroundings
- Purchase task
- Temporal effects
- Antecedent states

32
Q

What are physical influences?

A

These describe the physical and spatial contexts that shape, surround, and contain consumer activity

Examples of these variables include noise, scent, lighting, décor, layout, and location

33
Q

What are social influences and how do they affect purchases?

A

Social influences describe the social contexts (or lack thereof) that surround consumer activity. This can include the people with us or around us and the interactions we have with them.

When people shop with other people, they are more likely to purchase more items and spend more money, this drives up sales and spending.

Role of others in our lives (shopping behaviour, impulse buys):

When people shop with friends instead of family, people are more likely to explore different things or pick up more items (browsing and perusing is more common); impulse buying is more common.

34
Q

Describe temporal effects.

A

Temporal effects are those time-based variables that can influence the purchase decision process

  • People are looking more variety in their shopping as the day progresses; they are willing to make more risks and try exciting things.
  • At the beginning of the day, people stick with comfort and familiarity - they are groggy and less comfortable with risk

Time of year (comfort products with less daylight):
- As the temperature becomes colder, people will spend more money on comfort items

Amount of time available (lowest price, most recognizable):
- When people have little time to shop, they will go for the lowest price or most recognizable/item used in the past if there is no preference in mind

  • When people are faced with many items with the same price and have not purchased the product before, they will go for the most recognizable item based on commercials, promotion, etc
35
Q

Describe antecedent states.

A

Antecedent states are those non-enduring or temporary conditions experienced by a consumer immediately prior to entering the consumer purchase decision process.

Emotional state (familiarity vs. novelty)
- Positive mood → more open to novelty (new)
- Sad emotion levels → preference for familiarity

Energy level (self-regulation vs. impulsive buying)
- People who have more energy and are more alert will regulate their shopping and get what they need and go
- People who are exhausted have little self-regulation; more susceptible to impulse buying

Cash on hand
- The amount of money you have at a given time will influence your buying

36
Q

Describe purchase task.

A

Our purchase behaviours can be driven by situationally-specific objectives and defined by the task, goal, or outcome they are meant to accomplish

  • Goal of a shopping trip
  • Casual shoppers will browse and purchase more items
  • Goal-directed shoppers will only get what is necessary
  • Embarrassing items = more items purchased
  • People who purchase these embarrassing items will purchase more additional items to blend in their purchases so it is less noticeable
37
Q

What is sensory marketing?

A

Sensory marketing is a strategy of engaging the consumer sense in a multi-dimensional way to affect their perceptions and influence their behaviours.
- The efficacy of these strategies relies on the notion of “Embedded Cognition”.
- Associative learning
- When using sensory strategies, smart marketers will also want to strive for some congruence between the sensation, its situation/context, and the consumer’s expectations.
- Atmospherics

38
Q

Describe sensory marketing in relation to sound (genre, volume, tempo).

A

By harnessing the “power of audition”, sensory marketers can use ambient sound(s) to shape consumer behaviour (has to take into consideration congruence and trends).

Genre:
- Can shape perceptions and spending
- Category of music
- Directed at target market to attract customers
- Classical music is the most influential genre

Volume:
- can shape a consumers response
- Loudness of music
- High volume increases stress response
- Low volume can be unwelcome

Tempo:
- can impact the time spent shopping
- Speed of beat (bpm)
- Longer browsing at slower tempos
- Up tempo music can help control customer traffic; influence customers to move quicker

39
Q

Describe sensory marketing in relation to scent.

A

By harnessing “the power of olfaction”, and use ambient scent to adjust consumer behaviour.

Scent preferences, two theories:
1. The Innate View of odour preference
- Its a part of our biology
- Hardwired into us
- Ex. It tells us what’s safe and not safe to eat
2. The Learned View of order preference
- We learn what we like and don’t like because its taught to use or through experience

Ambient scents capable of:
- Increase consumer engagement
- Increase consumer spending
- Decrease perceptions of passage of times

40
Q

Define associative learning.

A

Marketers should always be aware of the consumer’s tendency to strongly connect sensory information with specific memories, emotions, or experiences.

Scent –> event –> emotion.

A consistent pairing with events will allow you to quickly associate the scent with an emotion.

41
Q

What are purchase activities?

A
  • How consumer acquire products
  • The steps consumer take in this process
  • Includes the purchase decision process
42
Q

What are the elements of consumer risk?

A
  • Performance
  • Personal
  • Economic
  • Social
43
Q

What are the different types of sets?

A
  1. Universal set
  2. Awareness set
    - Inept set
    - Evoked set
    - Inert set
44
Q

Define consumer satisfaction.

A

A subjective evaluation of whether a product met, fell short of, or exceeded the consumer’s expectations.

45
Q

What is consumer choice?

A

The long-help assumption among marketers was that consumer demand for variety was near infinite and that endless product variation was a good way to capture market share, beat competitors, and satisfy consumers.

46
Q

Why are psychographics and demographics important?

A
  • The psychographic profile that indicates differences between people and why similar people buy different products
  • Psychographic research determines the activities (work, sports, and hobbies), interests (family, friends, and social attitudes), and opinions (social, issues, businesses, or politics) of consumers
  • When information about a person’s lifestyle is combined with demographic data, a more complete picture of an individual emerges; a picture that allows marketers to understand how someone interacts with others and their surroundings
  • Psychographic information shows how an individual’s interest in a particular product depends on his or her lifestyle
  • Psychographics allow the marketing organization to position its products effectively in the marketplace and to communicate better with its target buyers
47
Q

Define age and life cycle.

A

Individuals and families progress through a series of stages, starting with being a young single adult, progressing to marriage and parenthood, and ending as an older single individual.
Understanding the stages in the life cycle offers insight into household purchase decisions.

48
Q

What is location-based targeting?

A

Technology allows marketers to locate consumers as they move around and communicate directly with them.

49
Q

Define atmospherics.

A

A specific sensory strategy involving the manipulation of situational sensory variables, shaping what the consumer experiences to influence their perceptions and behaviours.

  • Appealing to sense of smell, touch, etc
  • Lighting, music
  • Layout: design of floor space
    Eg. Bread and dairy are on opposite sides of the store so that
    customers will have to walk the distance and be enticed to purchase additional items; directs traffic.
  • Crowding (spatial, people)
    Spatial crowding is not welcoming. Crowding of people increases spending because it communicates that the environment is popular and offers good products and prices.
50
Q

Ambient scents and effective sensory marketing?

A
  • Congruence
    • Two things fit
    • Scent or sensation meets our expectation
  • Unidimensional
    • Scent is very clear
  • Familiar
    • We can recognize it
51
Q

What is the notion of “Embedded Cognition”?

A

This theory suggests that sensory information can have powerful; but non-conscious influence on us.

MOS 1021 (2 decks)

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