MRKT 452 Lecture Notes - Lecture 13: Video Lesson, Loss Aversion, Price Premium
11 Jun 2018
School
Department
Course
Professor
12#video#lectures#=#8#graded#pop-quizzes
==>#Buy-o-logy#1#&2/#Aisles#of#Persuasion#are#not#for#the#quizzes#(use#for#help#on#
the#mall#assignment)
Consumer)Behavior
Study#of#decisions#
Products
○
Services
○
Ideas#
○
•
Study#of#satisfaction
•
Study#of#branding
•
Decisions
Consumer#Products
Products
•
Services#
•
Ideas
•
Important#to:
Managers
Sales
○
Market#Share
○
Profits
○
Interest#in#repeat#purchase#over#time#=#more#profitable
○
•
Consumers#=#want#to#make#good#decisions#about#food,#saving,#etc.
•
Society#=#decisions#that#help#other#people,#the#environment,#and#future#
generations
•
Decision-Making
Decisions#are#influenced#by#information•
Marketers#can#design#information#to#influence#decisions•
Prices
9-Ending#Prices#=#consumers#pay#more#attention#to#the#left#digit#
(Anchoring)
○
Reference#Prices#=#consumers#use#reference# price#to#judge#value#
(Anchoring)#and#consumers#infer#it#is#a#limited#time#offer#(Anticipated#
Regret)
○
Loss#Leader#Prices
Generate#sales#for#slow#periods#=#demand#shifting
§
Sell#extras#during#the#experience# =#food,#drinks,#tours,#
advertising,#etc.
§
Encourage#trial#=#e.g.#good#experience# with#Easyjet#=>#increased#
liking#for#the#brand
§
Helps#attract#traffic#to#a#city#=#customers#buy#things#in#the#city
§
○
Advertising
Introductory#Offers
Experience# is#the#best#advertisement#=#first#hand#experience# vs.#
second#hand#experience#
§
People#find#it#difficult#to#give#up#things#=#loss#aversion
§
○
Branding
Branding#=#Fries#and#carrots#wrapped#in#McDonald's#wrapper#vs.#plain#
wrapper
○
Store#Design
Product#Display#-deep#discounted#items#are#often#displayed#far#in#the#
store#=#increases#temptation
○
Product#Scarcity#-limited#time/quantity#offers#are#used#to#increase#
sales#=#anticipated#regret
○
Social#Marketing
Organ#Donations#=#people#often#stick#with#the#"default#option"
○
Preauthorized#Savings#=#people#often#stick#with#"automatic#decisions"
○
Culture
E.g.)Chevy#Nova#didn't#sell#well#in#Spanish#speaking#countries#because#
Nova#means#"no-go"#in#Spanish
○
Group
Group#Think#=#too#much#cohesiveness#biases#decisions
○
Group#Dynamics#=#order#of#participation#biases#decisions
○
Customer)Satisfaction
Maximizing)It
Exceed#expectations#=#product#performance#should#exceed#consumer#
expectations
•
Satisfaction#with#process#vs.#product
Salesperson#training
○
Retail#ambiance
○
Post-purchase#follow-up
○
•
Minimizing#dissatisfaction#after#purchase#=#customer#service#and#
compensation#for#poor#performance
•
Measuring)It
Survey#data
Questions#measuring#overall#satisfaction#and#drivers#of#satisfaction
○
Key#drivers#of#customer#satisfaction#
○
•
Sales#data
Sales#records#of#customers
○
Customer#lifetime#value
○
Segmentation,#customer#acquisition#and#retention
○
•
Branding
Brand)Equity)-psychological#and#financial#features#of#a#brand
Importance
Ability#to#extend#brand#name#to#other#categories
○
Price#premium#over#unbranded#alternatives
○
Increases#power#in#distribution#channels
○
Increases#value#of#firm#during#acquisitions
○
Revenue#from#licensing
○
Managing#It
Advertising
○
Social#Media
○
Product#Design
○
Consumer)Behavior)Summary
Data)for)Understanding)Consumer)Behavior
Customer#Satisfaction•
Customer#Lifetime#Value•
Survey/Experiments#=#e.g.#Facebook#experiments#with#colors#sometimes#to#
see#who#stays#and#who#leaves
•
Customer/Social#Trends•
Secondary/Observational•
Big#Data•
Intro&to&Consumer&Behavior
Monday,#15#January#2018
10:22#AM
Document Summary
==> buy-o-logy 1 &2/ aisles of persuasion are not for the quizzes (use for help on the mall assignment) Interest in repeat purchase over time = more profitable. Consumers = want to make good decisions about food, saving, etc. Society = decisions that help other people, the environment, and future generations. 9-ending prices = consumers pay more attention to the left digit (anchoring) Reference prices = consumers use reference price to judge value (anchoring) and consumers infer it is a limited time offer (anticipated. Generate sales for slow periods = demand shifting. Sell extras during the experience = food, drinks, tours, advertising, etc. Encourage trial = e. g. good experience with easyjet => increased liking for the brand. Helps attract traffic to a city = customers buy things in the city. Experience is the best advertisement = first hand experience vs. second hand experience. People find it difficult to give up things = loss aversion.
