Consumer Behavior Chapter Summaries.docx

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Marketing and Consumer Studies
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MCS 2600
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Karen A.Gough

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Consumer Behavior Chap. Summary 1,4,5,6,7,8,9,13 Chapter 1 – Consumer Behavior: Meeting Changes and Challenges 1.1 - To Understand What Consumer Behavior Is and the different Types of Consumers What Is Consumer Behavior? Consumer Behavior is the behavior that consumers display in searching for, purchasing, using, evaluating, and disposing of products and services that they expect will satisfy their needs Consumer behavior focuses on how individual consumers and families or households make decisions to spend their available resources (time, money, effort) on consumption-related items. - what they buy, why they buy it, when they buy it, where they buy it, how often they buy it, how often they use it, how they evaluate it after purchase, impact of evaluations on future purchase, how they dispose it As consumers, we play a vital role in the health of the economy – local, national, and international. Our purchase decisions affect the demand for basic raw materials, transportation, production, banking; employment of workers and development of resources, success of some industries and failure of others Marketer’s need to know everything they can about consumers—what they want, what they think, how they work, and how they spend their leisure time They need to understand the personal and group influences that affect consumer decision and how to identify and know how to reach there target audience The term consumer behavior describes two different kinds of consuming entities: the personal consumer and the organizational consumer Personal Consumer buys goods and services for his or her own use, for the use of the household, or as a gift for a friend The products are bought for final use by individuals, who are referred to as end users or ultimate consumers Organizational Consumer includes profit and not-for-profit business, government agencies (local, state, and national), and institutions (e.g. schools, hospitals, and prisons), all of which must buy products, equipment, and services in order to run their organizations End-use consumption is the most pervasive behavior, because it involved every individual, of every age and background, in the role of the buyer or user or both. 1.2 - To Understand the Relationship Between Consumer Behavior and the Marketing Concept, the Societal Marketing Concept, as Well as Segmentation, Targeting, and Positioning Consumer Behavior and the Marketing Concept Strategic and applied field of consumer behavior is rooted in 3 philosophically different business orientations that lead up to one orientation called the marketing concept 1) Production orientation (1850-1920) – the focus during this period was gearing up manufacturing skills in order to expand production—to make more products Focus was on perfecting production capabilities of the company Demand exceeded supply and consumers were happy with what they got No emphasis on product variation, but were satisfied to be able to produce larger quantities of the product 2) Sales Orientation (1930-1950) – the focus was to sell more of what the manufacturing department was able to produce This second orientation extended out from the expanded capacity that was created during the production era Additional products being produced needed to be sold; the orientation shifted from producing to selling Supply reached a point where it was greater than demand Created a need for some really different thinking on the part of businesses eager to expand but were held back by oversupply of similar products 3) Marketing orientation (1950’s) – at the “heart” of the emerging marketing orientation was the realization that it was time for businesses to focus more of their attention on consumers and their preferences; to put consumersfirst in their business thinking and planning Consider what consumers wanted, rather than what the company finds easiest to make or least expensive to make, is in keeping with the marketing concept Accepting market orientation leads to the core philosophy of marketing, the marketing concept What is the Marketing Concept? Key assumption of marketing concept is in order to be successful, a company must determine the needs and wants of specific target markets and deliver the desired satisfactions better than the competition A satisfactory profit is envisioned as an appropriate reward for satisfying consumers’ needs, not as a right of simply being in business Marketing Concept (defined) is a consumer-oriented philosophy that suggests that satisfaction of consumer needs provides the focus for product development and marketing strategy to enable the firm to meet its own organizational goals Example of repositioning and market targeting page 8-9 Marketing concept is a highly useful guideline and philosophy for managing businesses because it has effectively served to remind businesses to keep consumers’ needs up-front when contemplating new products and services, crafting marketing communications, or planning other strategies Societal Marketing Concept suggests that consumers may on occasion respond to their immediate needs or wants, while overlooking what is in effect in their own long-run best interest, or the best interest of their family and neighbors, the best of their country or region, or even the best interest of the entire planet “Societal Marketing” refers to the role of enlightened marketers; management who takes it upon itself to remind consumers as to what is in consumers long-run best interest and also sets out what its own company is doing in order to be a good corporate citizen FIGURE 1.1 Embracing the Marketing Concept Consumer Research represents the process and tools used to study consumer behavior Companies continuously conduct marketing research to monitor consumers’ needs and preferences Consumers are complex with psychological and social needs apart from their functional needs The needs and priorities of different consumer segments differ dramatically, and the objectives of a company should be to target different products and services to different market segments in order to satisfy the needs Segmentation, Targeting, and Positioning Market Segmentation is the process of dividing a market into subsets of consumers with common needs or characteristics Because most companies have limited resources, few companies can pursue all the market segments identified Market Targeting is the selection of one or more of the segments identified for the company to pursue Positioning refers to the development of a distinct image for the product or service in the mind of the consumer, an image that will differentiate the offering from competing ones and faithfully communicate to the target audience that the particular product or service will fulfill their needs better than competing brands Successful positioning centre’s around two key principles: 1) Communicating the benefits that the product will provide rather than the products features. “Consumers do not buy drill bits—they buy what makes holes” 2) Because there are many similar products in the marketplace, effective positioning strategy must develop and communicate a unique selling proposition—a distinctive benefit or point of difference—for the product or service “me too” products lack a unique image or benefit The Marketing Mix The Marketing Mix consists of a company’s service and/or product offerings to consumers and the methods and tools it selects to accomplish the exchange Marketing Mix consists of 4 elements known as “four P’s”: 1) the Product - features, designs, brands, and packaging of a good or service offering, along with post purchase benefits such as warranties and return policies 2) the Price - the list price, including discounts, allowances, and payment methods 3) the Place - the distribution of the product or service through specific store and non-store outlets 4) Promotion - the advertising, sales promotion, public relations, and personal selling efforts designed to build awareness of and demand for the goods or service 1.3 – To Understand the Relationship Between Consumer Behavior and Customer Value, Satisfaction, Trust, and Retention Consumer Value, Satisfaction, Trust, and Retention Many companies have adopted the marketing concept since it emerged in the 1950’s The result is more products in more sizes, models, versions etc. and more precise target markets. This has resulted in increasingly competitive marketplace. Internet has allowed very less costly distribution. This has accelerated the rate at which new competitors enter markets and sped up rate at which segmentation, targeting and positioning approaches must be updated or changed. Most of all, these changes have been very positive for consumers to be proactive in seeking out online information, opinions, product availability, and price comparisons. Marketers today must make the customer the core of the company’s organizational culture, across all departments and functions, and ensure each and every employee views any exchange with a customer as part of a customer relationship, not as a transaction. Four drivers of successful relationships between marketers and customers are 1) Customer Value 2) High levels of customer satisfaction 3) Strong sense of customer trust 4) Building a structure that ensures customer retention Providing Customers with Value Customer Value can be thought of as the ratio between the customers’ perceived benefits (economic, functional, and psychological) and the resources (monetary, time effort, psychological) used to obtain those benefits. Perceived value is relative and subjective Developing a value proposition (term replacing the popular business term unique selling proposition) and looking for the impact of emerging “megatrends” (e.g. individualism, choice overload, hiving, geek chic) are influential factors in attaining successful positioning of a brand Ensuring Customer Satisfaction Customer Satisfaction is the individual consumer’s perception of the performance of the product or service in relation to his or her expectations The concept of customer satisfaction is a function of customer expectations A customer whose experience falls below expectations will be dissatisfied. A customer whose experiences match expectations will be satisfied, and customers whose expectations are exceeded will be very satisfied or even delighted. On the positive side, there are completely satisfied customers who are either loyalists who keep purchasing, or apostles whose experiences exceed their expectations and who provide very positive word-of-mouth about the company to others On the negative side there are defectors who feel neutral or merely satisfied and are just as likely to stop doing business with the company; consumer terrorists who have had negative experiences with the company and who spread negative word of mouth; and hostages who are unhappy customers who stay with the company because of a monopolistic environment or low prices and who are difficult and costly to deal with because of their frequent complaints. Then there are mercenaries who while being satisfied customers, really o not have any real loyalty to the company and may defect at any point for a lower price elsewhere or on impulse, defying the satisfaction—loyalty rationale Companies should strive to create apostles, raise satisfaction of defectors and turn them into loyalists, avoid having terrorists or hostages and reduce the number of mercenaries Building Customer Trust Consumers trust of a range of different consumer information sources reveals that word-of-mouth communications or recommendations from other consumers is in a league by itself in terms of being the most trusted source of consumer information Newspapers, consumer opinions posted online, and brand Web sites are also high scoring in terms of being trustworthy in the minds of consumers. Ads before movies, online banner ads, search engine ads, text mobile ads etc. are on the bottom of the list Specific dimension of trust is privacy TABLE 1.2 If a customers relationship is at risk in terms of trust, there is also the related concept of delight, in which a company seeks to recover in the eyes and minds of consumers by setting things in right with the customer and further demonstrates to that customer that he or she is valued Securing Customer Retention A strategy of customer retention is designed to make it in the best interest of customers to stay with a company rather than switch to another company Customer Retention (defined) is providing value to customers continuously so they will stay with the company rather than switch to a competitor More expensive to secure new customers than to keep existing ones Small reductions in customer defections produce significant increases in profits because 1) loyal customers buy more products 2) loyal customers are less price sensitive and pay less attention to competitors advertising 3) servicing existing customers, who are familiar with the company’s offerings and processes, is cheaper 4) loyal customers spread positive word of mouth and refer other customers Internet and cell phone are important “tools of interaction” for both marketers and consumers to communicate with each other Marketers can create customized products and services coupled with customized marketing messages that cater to the needs of consumers called one-to-one marketing) Sophisticated marketers build selective relationships with customers, based on where customers rank in terms of profitability, rather than merely strive to retain customers Customer profitability-focused marketing tracks costs and revenues of individual customers and then categorizes them into tiers based on consumption behaviors that are specific to the company’s offerings “Customer Pyramid” 1) The platinum tier includes heavy users who are not price sensitive and who are willing to try new offerings 2) The gold tier consists of customers who are heavy users but not as profitable because they are more price sensitive than those in the higher tier, ask for more discounts, and are likely to buy from several providers 3) The iron tier consists of customers whose spending volume and profitability do not merit special treatment from the company 4) The lead tier includes customers who actually cost the company money because they claim more attention than is merited by their spending, tie up company resources, and spread negative word of mouth TABE 1.3 1.4 – To Understand How New Technologies Are Enabling Marketers to Better Satisfy the Needs and Wants of Consumers The Impact of New Technologies on Marketing Strategies These new technologies and new media have made it easier for marketers to adapt the elements of the marketing mix to specific consumers’ needs and to more quickly and efficiently build and maintain relationships with customers Online communication and emerging digital technologies have introduced several dramatic changes into the marketing environment Consumers Have More Power Than Ever Before They can use “intelligent agents” to locate the best prices for products or services, bid on various marketing offers, bypass distribution outlets and middlemen, and shop for goods around the globe and around the clock from the convenience of there own home. Consumers Have More Access To Information Than Ever Before They easily find reviews for products they are considering buying that have been posted by previous buyers and participate in virtual communities of persons who share the same interests they do Marketers Can and Must Offer More Services and Products Than Ever Before The digitization of information enables sellers to customize the products and services they are selling and still sell them at reasonable prices. Also allows marketers to customize the promotional messages directed at many customers. Increasing Instantaneous Exchanges between Marketers and Customers Traditional advertising is a on way street where the marketer pays a large sum of money to reach a large number of potential buyers via mass medium, and then assesses whether or not the message was effective. Digital or new media communication enables a two-way interactive exchange in which consumers can instantly react to the marketers message by clicking on links in a Web site. Marketers Can Gather More Information About Consumers More Quickly And Easily Many marketers now employ narrowcasting—a method that enables them to develop and deliver more customized messages to increasingly smaller market segments on an ongoing basis Impact Reaches Beyond the PC-Based Connection Of the Web Page 16 1.5 – To Understand How Marketers Are Increasingly Able to Reach Consumers Wherever Consumers Wish to Be Reached The Mobile Consumer We can expect expanded use of wireless media messages as 1) the availability of flat-rate data traffic to consumers increases 2) with creation of enhanced screen image quality 3) increased consumer-user experiences with improved Web-related applications FIGURE 1.3 1.7 – To Understand the Makeup and Composition of a Model of Consumer Behavior Consumer Behavior and Decision Making Are Interdisciplinary Consumer behavior was a new field of study until the mid-late 1960’s. Marketing theorists borrows heavily from the concepts developed in other scientific disciplines, such as psychology (study of the individual), sociology (study of groups), social psychology (study of how an individual operates in groups), anthropology (the influence of society on the individual), and economics to form the basis of this new marketing discipline A Model of Consumer Decision Making The process of consumer decision-making can be viewed as three distinct but interlocking stages: the input stage, the process stage, and the output stage FIGURE 1.4 Input stage influences the consumers recognition of a product need and consists of two major sources of information: the company’s marketing efforts (the product itself, its price, its promotion, and where its sold) and the external sociological influences on the consumer (family, friends, social class, cultural and sub cultural memberships) The process stage focuses on how consumers make decisions. Psychological factors inherent in each individual (motivation, perception, leaning, personality, attitude) affect how the external inputs from the input stage influence the consumer’s recognition of a need, prepurchase search for information and evaluation of alternatives. The output stage of the consumer decision-making model consists of two closely related post-decision activities: purchase behavior and post-purchase evaluation. Page 19 Page 20 for Summary Chapter 4: Consumer Motivation Motivation as a Psychological Force  Motivation: the driving force within individuals that impel them to act o this driving force is produced by a state of tension resulting from an unfulfilled need NEEDS  Innate: physiological, needs like water, food, air, shelter, sex etc. o they are required to sustain life and are therefore considered primary needs  Acquired: needs we have learned in response to our environment & culture, needs like self esteem, power, learning etc. o they are considered psychological, not necessary to sustain life, secondary needs  Example: finding shelter is an innate need; seeking a ritzy condo to provide the shelter is a secondary need  Needs can have a positive direction (wants, desires) or a negative one (fears, aversions) GOALS  Goals are sought after results of motivated behaviour  Generic goals: general classes of goals consumers see as a means of fulfilling their needs o Example: Completing an undergrad degree  Product specific goals: specifically branded goals consumes chose to fulfill their needs o Example: Completing a BComm program at the University of Guelph  Goal selection o Goal selection is based on experience, physical capability, norms, values, capability etc. o Approach object: a positive goal, behaviour is directed towards it o Avoidance object: a negative goal, behaviour directed away from it RATIONAL VS EMOTIONAL MOTIVES  Rational: select goals based on objective info like size, price, weight etc.  Emotional: selecting goals based on personal criteria like pride and affection The Dynamics of Motivation  Needs are never fully/permanently satisfied o Ex: throughout the day we experience hunger needs that must be satisfied  New needs emerge as old needs are satisfied o Ex: Maslow’s hierarchy of needs  Success and failure influence goals o Once you achieve a goal you are likely to set the next one higher, raising your levels of aspiration o Works in reverse, those who don’t reach their goals lower their levels of aspiration o Substitute goals sufficiently take the place of the original goal o When people do not attaint their goals, multiple defense mechanism come into play  Ex: aggression, rationalization, withdrawal etc. AROUSAL OF MOTIVES  Physiological  Emotional  Cognitive  2 opposing views on motive arousal o Behaviourist school – motivation is a mechanical process, no conscious thought involved  Ex: an impulse buy o Cognitive school – all behaviour is directed at goal achievement Types and Systems of Needs MASLOW`S HIERARCHY  Physiological  Safety and security  Social needs  Ego needs  Self-actualization These stages are ranked in order or importance, lower level needs (physiological) must be satisfied before the higher level needs emerge. Each level is generally mutually exclusive although there is some overlap as no need will ever be fully satisfied. Marketers use the needs triangle to determine how their products can be matched to a level that the majority of consumers are currently at. MURRAY`S LIST OF PSCHOGENIC NEEDS  Needs associated with inanimate objects o Ex: retention, order  Needs that reflect ambition, power, accomplishment, and prestige o Ex: recognition, achievement  Needs concerned with human power o Ex: dominance, autonomy  Sadomasochistic needs o Ex: aggression  Needs concerned with affection between people o Ex: affiliation, rejection  Needs concerned with social intercourse o Ex: exposition Murray`s approach was the first systematic approach to understanding human needs that aren`t biological. A TRIO OF NEEDS  Power o Desire to control your environment, closely related to the Ego need  Affiliation o Behaviour is strongly influenced by the desire for friendship, acceptance or belonging, a social dependence  Achievement o More self confident and see accomplishment as an end in itself o Closely related to self actualization and ego The Measurement of Motives  Because motives are intangible, no single measure can really be set  Combinations of measures are used instead, these can include anything from surveys to focus groups  Qualitative (aka projective) techniques are often used because ambiguous stimuli require participants to tap into their subconscious  Motivational Research o First coined in the `50s (by Dichter) to describe these qualitative methods o Created to uncover consumers subconscious based on the fact we are not always aware of these motives o Examples of qualitative methods:  Storytelling – customers tell it as it is regarding certain products they`ve used  Thematic apperception tests – pictures are shown and participants are asked to tell a story about the picture, these ideas are used in ad creation and marketing technique  Chapter 5- Personality and Consumer Behaviour Personality can be defined as those inner psychological characteristics that both determine and reflect how a person responds to his or her environment. inner characteristics- specific qualities, attributes, traits, factors and mannerisms that distinguishes one individual from another. 3 distinct properties in the study of personality: 1- Personality reflects individual differences 2- Personality is consistent and enduring 3- Personality can change (personality changes not only in response to abrupt events but also as part of a gradual maturing process) Theories of Personality Freudian Theory: Sigmund Freud’s psychoanalytic theory of personality is one of the cornerstones of modern psychology. It was built on the premise that unconscious needs or drives are at the heart of human motivation and personality. He constructed his theory on the basis of patients’ recollections of early childhood experiences, analysis of dreams, and the specific nature of their mental and physical adjustment problems. He proposed that human personality consists of 3 interacting systems: 1- Id (primitive and impulse drives such as thirst, hunger, sex) 2- Superego (internal expression of society’s moral and ethical codes of conduct) 3- Ego (the individual’s conscious control, the balance between Id and Superego) Freud emphasized that individuals pass through a number of childhood development stages that are named; oral, anal, phallic, and genital stages. When Freud’s theory is applied by researchers it is believed that human drives are largely unconscious and that consumers are primarily unaware of their true reasons for buying what they buy. Neo-Freudian Personality Theory: Believed that social relationships are fundamental to the formation and development of personality. Alfred Adler viewed human beings as seeking to attain various rational goals, which he called style of life. He also places emphasis on the individual’s efforts to overcome feelings of inferiority. Harry Stack Sullivan, another neo- Freudian, stressed that people continuously attempt to establish significant and rewarding relationships with others. He was particularly concerned with the individual’s efforts to reduce tensions, such as anxiety. Karen Horney was also interested in anxiety, and focused on the impact of child parent relationships and the individual’s desire to conquer feelings of anxiety. Horney proposed that individuals be classified into 3 personality groups: 1- Compliant individuals move toward others (desire to be loved) 2- Aggressive individuals move against others (desire to excel and win admiration) 3- Detached individuals move away from others (desire independence, individualism) Trait Theory: The orientation of trait theory is primarily quantitative or empirical; it focuses on the measurement of personality in terms of specific psychological characteristics, called traits (any distinguishing relatively enduring way in which one individual differs from another). Single-trait personality tests measure just one trait, are often developed specifically for use in consumer behaviour studies. They measure traits such as consumer innovativeness (how receptive a person is to new consumer-related experiences), consumer materialism (the degree of the consumer’s attachment to worldly possessions) and consumer ethnocentrism (the consumer’s likelihood to accept or reject foreign- made products). Trait researchers believe it is more realistic to expect personality to be linked to how consumers make their choices and to the purchase or consumption of a broad product category as opposed to a specific brand. Personality traits that have been useful in differentiating between consumer innovators and non-innovators include consumer innovativeness, dogmatism, social character, need for uniqueness, optimum stimulation level, sensation seeking, and variety novelty seeking. Consumer innovators: Those who are open to new ideas and to be among the first to try new products, services or practices. The 3 personality traits of Consumer Innovativeness: 1- Global innovativeness- exists independent of any context; one that represents the “very nature” 2- Domain-specific innovativeness- narrowly defined activity within a specific domain or product category 3- Innovative behaviour- a pattern of actions or responses that indicate early acceptance of change and adoption of innovations Consumer Dogmatism: a personality trait that measures the degree of rigidity (vs. openness) that individuals display towards the unfamiliar and toward information that is contrary to their own established beliefs. Ex. Someone who is highly dogmatic approaches the unfamiliar defensively and with considerable discomfort and uncertainty, and is more likely to choose established products. Someone who is low dogmatic (open minded) will readily consider the unfamiliar or opposing beliefs and prefers innovative products. Social Character: the classification of individuals into distinct sociocultural types. Inner-directedness consumers tend to rely on their own inner values or standards in evaluating new products and are likely to be consumer innovators (prefer ads that stress product features and benefits). Other-directedness consumers tend to look to others for guidance as to what is appropriate or not and are less-likely to be consumer innovators (prefer ads that feature an approving social environment or group). Need for Uniqueness: People who strive to be differentiated and conformity to others’ expectations is avoided. Research indicated that people with high NFU are not concerned about being criticized, and are receptive to making unique choices. Optimum Stimulation Level: the level of stimulation an individual desires. Some people prefer a simple, uncluttered, and calm existence, whereas others prefer an environment crammed with novel, complex, and unusual experiences. High OSLs (exploratory behaviours) are linked with greater willingness to take risks, to try new products, to be innovative, to seek purchase-related information, and to accept new retail facilities than low OSLs. Sensation Seeking: a trait characterized by the need for varied, novel, and complex sensations and experience, and the willingness to take physical and social risks. Closely related to OSL. Variety or Novelty Seeking: another personality-driven trait closely related to OSL. There appear to be many different types of consumer-variety seeking: exploratory purchase behaviour (switching brands to experience new, different and possibly better alternatives), vicarious exploration (securing information about a new or different alternative and then contemplating about the option), and use innovativeness (using an already adopted product in a new or novel way). Cognitive Personality Factors 1. Need for Cognition: a promising cognitive personality characteristic that measures a person’s craving for or enjoyment of thinking. Consumers who are high in NTC are more likely to be responsive to the part of an ad that is rich in product-related information or description; whereas consumers with low NFC are more likely to be attracted to the background or peripheral aspects of an ad (attractive model). 2. Visualizers versus Verbalizers: cognitive personality research classifies consumers into two groups: visualizers (consumers who prefer visual information and products that stress the visual) or verbalizers (consumers who prefer written or verbal information and products). There are two different types of visualizers; object visualizers encode and process images as a single perceptual unit, while spatial visualizers process images piece by piece. Consumer Materialism Materialism (the extent to which a person is considered materialistic) distinguishes between individuals who regard possessions as essential to their identities and their lives and those for whom possessions are secondary. Characteristics of materialistic people include (1) They especially value acquiring and showing off possessions; (2) they are particularly self-centered and selfish; (3) they seek lifestyles full of possessions, and (4) their many possessions do not give them greater personal satisfaction. “Tightwads” generally spend less than they would like to due to anticipated pain they associate with making purchases, while “spendthrifts” find little pain in paying and therefore they spend more. Consumption dreaming: consumer dreams about material objects and experiences. Five categories of consumption dreams: 1- consumption 2- information 3- planning 4- communication 5- visualization Fixated Consumption Behaviour: is in the realm of normal and socially acceptable behaviour. Fixated consumers do not keep their objects or purchases of interest a secret; rather, they frequently display them. For example, people who collect something and keep their collection on display. Fixated consumers have the following characteristics: (1) a deep interest in a particular object or product category, (2) a willingness to go to considerable lengths to secure additional examples of the object or product, and (3) the dedication of a considerable amount of discretionary time and money to search. Compulsive Consumption Behaviour: is in the realm of abnormal behaviour, the “dark side” of consumption. Consumers who are compulsive have an addiction; in some aspects they are out of control, and their actions may have consequences. Oniomania is a new term for people who suffer from a shopping addiction. Consumer Ethnocentrism: Responses to Foreign-Made Products CETSCALE has been successful in identifying consumers with a predisposition to accept (or reject) foreign-made products, and has been shown to be a reliable measure in both the US and other nations. Consumers who are highly ethnocentric are likely to feel that it is inappropriate to purchase foreign-made products due to the resulting economic impact on the domestic economy, whereas nonethnocentric consumers tent to evaluate foreign-made products-ostensibly more objectively- for their extrinsic characteristics. Country-by-Country Ethnocentrism- evidence suggests that ethnocentrism varies by country and product. For example, Mexican consumers are more ethnocentric than their French and American counterparts. Cosmopolitanism is opposite of the ethnocentric view, that is a consumer with a cosmopolitan orientation would consider the world to be his or her marketplace, and would consciously be attracted to products, experiences, and places from other cultures. Brand Personality Consumers subscribe to the notion of brand personality, that is, they attribute various descriptive personality-like traits or characteristics to different brands in a wide variety or product categories. A brand personality provides an emotional identity for a brand, and encourages consumers to respond with feelings and emotions toward the brand. A Brand’s personality can either be functional (“dependable and rugged”) or symbolic (“the athlete in all of us”). Marketing communication most often has the greatest influence in creating a brand personality. There are two categories or service brand personality types: (1) traits derived from the Brand Personality Scale, and (2) traits derived from the Five Factor Model of Personality. BPS Traits: sincerity, excitement, competence, sophistication and ruggedness. FFM Traits: Agreeableness, extroversion, creativity, stability and conscientiousness. **See pg. 139 for description and examples. Product Anthropomorphism Anthropomorphism is attributing human characteristics to something that is not human. Products presented as human but which lack human features tend to be evaluated less favourably by consumers than products that are presented as human and have human-like attributes. Brand Personification Brand personification tries to recast consumers’ perception of the attributes of a product or service into a human-like character. Sometimes the consumer develops a relationship with a brand that is similar in certain respects to the relationships they have with other humans. The brand personality framework is as follows: Sincerity >down-to-earth, honest, wholesome, cheerful. Excitement >daring, spirited, imaginative, up-to-date Competence > reliable, intelligent, successful Sophistication >upper-class, charming Ruggedness > outdoorsy, tough Product Personality and Gender A product personality, or persona, frequently endows the product or brand with a gender. For example Mr. Coffee was given a masculine persona. Product Personality and Geography Marketers learned long ago that certain products, in the minds of consumers, posses a strong geographical association (New England clam chowder). By employing geography in the product’s name, the product’s manufacturer creates a geographic personality for the product. Personality and Colour Consumers associate personality factors with specific colours (coca-cola is associated with red, which connotes excitement) Blue- respect, authority Yellow- caution, novelty Green- secure, natural, relaxed Red- human, exciting, hot Orange- powerful, affordable Brown- informal, masculine, relaxed White- goodness, purity, chastity Black- sophistication, power Silver, Gold, Platinum- regal, wealthy Self and Self-Image Individuals have been thought to have a simple self-image and to be interested, as consumers, in products and services that satisfy that single self. However it is more accurate to think of consumers as having multiple selves. This thinking reflects the understanding that a single consumer is likely to act quite differently with different people and in different situations. In terms of consumer behaviour, the idea that an individual embodies a number of different “selves” suggests that marketers should target their products and services to consumers within the contexts of a particular self, and in certain cases, a choice of different products or different selves. The Makeup of the Self-Image Consistent with the idea of multiple self-images, each individual has an image of him or herself as a certain kind of person, with certain traits, skills, habits, possessions, relationships, and ways of behaving. Individuals develop their self- images through interactions with other people- initially their parents, and then other individuals or groups with whom they relate. A variety of different self-images have been recognized in the consumer behaviour literature: (1) actual self-image (how consumers in fact see themselves), (2) ideal self-image (how consumers would like to see themselves), (3) social self-image (how consumers feel others see them), and (4) ideal self- image (how consumers would like others to see them). Expected self- how consumers expect to see themselves at some specific future time (somewhere between actual and ideal self) Ought-to self- consists of traits or characteristics that an individual believes it is their duty or obligation to possess The Extended Self Consumers’ possessions can be seen to confirm or extend their self-images. This can be done in a number of ways: (1) actually, by allowing the person to do things that otherwise would be very difficult or impossible to accomplish (problem solving by using a computer), (2) symbolically, by making the person feel better or bigger (receiving an award), (3) by conferring status or rank (among collectors of rare works of art because of the ownership of a particular masterpiece), (4) by bestowing feelings of immortality by leaving valued possessions to young family members (this also has the potential of extending the recipients’ selves) and (5) by endowing with magical powers (a pair of cuff links inherited from one’s grandfather might be perceived as magic amulets bestowing good luck when they are worn) Altering the Self Sometimes consumers wish to change themselves to become a different or improved self by using things such as clothing, grooming aids, cosmetics, accessories to modify their appearance. In using self-altering products, consumers are frequently attempting to express their individualism or uniqueness by creating a new self, maintaining the existing self and extending the self. Physical vanity is an excessive concern for and/or a positive or inflated view of one’s personal appearance and achievement vanity is an excessive concern for and/or a positive or inflated view of one’s personal achievements. Low self-monitors are individuals who are typically guided by their inner feelings whereas high self- monitors claim that they act differently in different situations with different people. Virtual Personality or Self The notion of a virtual personality or virtual self provides an individual with the opportunity to try on different personalities or different identities, much like going to the mall and trying on different outfits in a store. An example is taking part in an online chat room where you can create your own identity from scratch.  Chapter 6  Consumer Perception  Perception – the process by which an individual selects, organizes and interprets stimuli into a meaningful and coherent picture of the world  Sensation – immediate and direct response of the sensory organs to stimuli.  Stimulus – any unit of input to any of the senses  Sensory receptors – the human organs that receive sensory inputs (eyes, ears, nose, mouth, skin)  Absolute threshold – lowest level at which an individual can experience a sensation  Sensory adaptation – “getting used to” certain sensations; becoming accommodated to a certain level of stimulation  Differential threshold (just noticeable different j.n.d) – minimal difference that can be detected between two similar stimuli  Weber’s law – the stronger the initial stimulus, the greater the additional intensity needed for second stimulus to be perceived as different  Subliminal perception – stimuli that are too weak or brief to be consciously seen or heard may nethertheless be strong enough to be perceived by one or more receptor cells  Selective Exposure – consumers actively seek out messages that they find pleasant or with which they are sympathetic, and they actively avoid painful or threatening ones  Selective attention – consumers exercise a great deal of selectivity in terms of the attention they give to commercial stimuli and minimal awareness of stimuli irrelevant to their needs  Perceptual Defense – consumers subconsciously screen out stimuli that they find psychologically threatening, even though exposure has already taken place. Vary and increase amount of sensory input to fight perceptual defense  Perceptual Blocking – consumers protect themselves from being bombarded with stimuli by simply “tuning out” – blocking such stimuli from conscious awareness  Gestalt Psychology – three of the most basic principles of perceptual organization are Figure and Ground, Grouping, Closure  Product Placement (Branded Entertainment) – advertised product is integrated into the TV show or film (used by cast or integrated into plot)  Grouping – perception of stimuli as groups or chunks of information, rather than discrete bits of information, facilitates their memory and recall.  Stereotypes – biased pictures in peoples’ minds of the meanings of various stimuli, mainly triggered by physical appearances, descriptive terms, first impressions and the halo effect  Halo Effect – used to describe situations in which the evaluation of a single object or person on a multitude of dimensions is based on the evaluation of just one or a few dimensions  Positioning – the image that a product has in the mind of the consumer  Perceptual Mapping –enables marketers to determine just how they want their products or services to appear to consumers in relation to competitive brands on one or more relevant characteristics.  Perceived Price – should reflect the value that the customer receives from the purchase  Satisfaction-based pricing, relationship pricing, efficiency pricing  Reference Prices – any price that a consumer uses as a basis for comparison in judging another price, can be internal or external  Perceived Risk – uncertainty that consumers face when they cannot foresee the consequences of their purchase decisions  High risk perceivers are considered narrow categorizers because they limit their choices to safe alternatives  Low risk perceivers are considered broad categorizers because they tend to make decisions from a much wider range of alternatives  Types of Perceived Risk Functional: risk that product wont perform as expected Physical: risk product causes to self and others Financial: risk that product won’t be worth the cost Social: risk that poor product choice may result in embarrassment Psychological: risk that poor product choice may bruise consumer’s ego Time: risk of time wasted  How Consumers Handle Risk Seek info: from word of mouth, salespeople and general media, more important when high risk associated with purchase brand loyal: remain loyal to brand with previous satisfactory experience. High risk perceivers more likely to remain loyal select brand image: “trust” a favored or well-known brand when you have little experience rely on store image: depending on the store’s careful decisions when buying their products buy most expensive model: price/quality relationship, people think the most expensive will be the best seek reassurance: money back guarantees, government and laboratory test results, warranties, repurchase trials etc. Chapter 7: Consumer Learning Page 190-223 LEARNING - Learning = the process by which individuals acquire the purchase and consumption knowledge and experience that they need apply to future related behavior o Process – continuously evolving and changing o Knowledge o Experience – incidental and possibly unintentional o Consumer learning - Elements of Learning: o Motivation  Unfulfilled needs lead to motivation which spurs learning o Cues  Cues are the stimuli that directed these motives o Response  How individuals react to a drive or cue o Reinforcement  Increases the likelihood that a specific response will occur in the future as the result of particular cues or stimuli - The 2 general categories of learning theory are behavioral learning and cognitive learning BEHAVIORAL LEARNING - Behavioral Learning (also referred to as Stimulus Response Learning) = When a person acts (responds) in a predictable way to a known stimulus then he/she is said to have learned o Deals with the inputs and outcomes of income - 3 forms of behavioral learning that are relevant to marketing are classical conditioning, instrumental (or operant) learning and observational (vicarious) learning - Classical Conditioning o Conditioning – response to a situation built up through repeated exposure
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