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ADV 3008 Lecture Notes - Lecture 4: Cognitive Dissonance, A.D. Vision, Naproxen

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School
UCF
Department
Advertising
Course
ADV 3008
Professor
Darius Lana

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Document Summary

*the age of a product has little to do with what stage the product is in at any given time. New product: educate consumers about new products and services, demonstrate a need the(cid:455) did(cid:374)"t k(cid:374)o(cid:449) the(cid:455) had, (cid:449)hi(cid:272)h is fulfilled (cid:271)(cid:455) the produ(cid:272)t, show that a new product exists which can fulfill a recognized need. Advertising messages have a key role for products in this stage. The (cid:272)o(cid:374)su(cid:373)er is aski(cid:374)g (cid:862)what is this produ(cid:272)t for? (cid:863) Ads must show the product does offer a better way of doing things. You can get out in front of your customers before the competition. You can define the category to best reflect your product. It is expensive (research, development, and advertising costs) Requires the advertiser to educate consumers about why they need it. This phase is risky; estimated failure for new products is 67% Example: aleve was the first pain reliever to offer 8 to 12-hour dosing.

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Related Questions

The purpose behind much of advertising is to influence each of the five Consumer Decision Making process (Problem Recognition, Information Search, Evaluation of Alternatives, Product Choice (i.e. Purchase) and Outcomes (i.e. Postpurchase). Each stage of the Consumer Decision Making process has techniques that help consumers to manage the stage and then move onto the next one successfully. Eventually, the consumer moves to purchase (where we get excited to make the sale) but don't underestimate how important the last stage (post purchase) is to making additional sales in the future. Below are guidelines that show basic techiniques used to target and manipulate each Consumer Decision Stage through advertising.

Below are some issues that you will want to consider as you evaluate each of the five chosen advertisements. Please remember that your goal is not simply to answer these questions, but to provide insights into the consumer’s decision making process that you feel would be useful to a marketing manager (e.g., if an ad triggered the consumer’s decision to purchase the product). Other areas to comment on would be level of involvement, etc.

Consumer Decision Making Stage:

Considerations for Stage:

Common Ad Techniques:

Problem Recognition

What problems does this product solve for the consumer? • What triggered the decision to purchase this product? • Was this the first time the consumer purchased such a product?

Define and discern the Actual and Desired States

Ask a question (What’s for dinner tonight?)

Show before (actual state) and after (desired state)

Use the word “new” or “introducing” to initiate curiosity.

Information Search

• Did the consumer seek information about the product and about various brands? How was this information collected, and how much information was collected? • Was the consumer searching for any advertisements for the product? What was the consumer’s reaction to these advertisements?

Match amount of information with type of product.

Direct consumers to website, free kit or other information venues.

Show role models that “look” like the target market.

Show the entire line of product offerings (all the flavors and colors, etc.)

Testimonials, etc.

Evaluation of Alternatives

• How many alternatives were considered? How were they selected?• What features and characteristics of the product were most important to the consumer? Salient and Determinant defined attributes.
• How important was the brand of the product to the consumer?

Featuring specific variables that the product is known for (ex. Volvo=Safety). This is known as “positioning” a product.

Competitive method (brand compares themselves to “leading brand or category”)

Comparative method (brand compares themselves to another brand by name (Coke vs. Pepsi)

Product Choice

• Did any other people play a role in the decision process? Describe theroles that each person played.
• How was the final choice determined? How carefully was the decision made?
• Where did the consumer make the purchase? Why? • Did the consumer pay full price for the product?

Tell consumers where and how the product is sold.

Offer many ways to pay for the product.

Divide payments.

Offer sales promotion (coupons, rebates)

Post-Purchase Evaluation

• How is the product used and consumed? How does the consumer feel when he or she uses the product?
• What is the meaning of this product to the consumer?

Does it merely
serve a function for the consumer, or does it say something about who the consumer is?

Does the Ad encourage repeat purchase or loyalty to the brand- how?

Show awards the brand has won.

Show how a brand should be consumed.

Allow consumers many ways to return the product.

Allow consumers to easily provide feedback.

Reward consumers loyalty

This assignment asks you to find one ad that addresses each of the needs of the five stages (in other words five different ads). This means that there must be five different ads for the total project, one for each stage (all ads are different from one another). Create a Power Point Presentation that shows how the advertiser is addressing the needs of the consumer for the specific Consumer Decision Making stage.

*Be aware that there is a helpful power point demonstration in a conference opened this week marked as "Advertising and the Consumer Decision Process (Ad Examples)". This is informative only and does not need to be commented on.

First, show the ad in a slide and then follow-up with a slide which explains (bullet form) why the ad slide targets the Consumer Decision Making process stage. ALL ADS MUST BE STILL ADS (NO VIDEOS or LINKS). Therefore the ad MUST be able to be copied and pasted within the power point slide (NO LINKS). Here is the format of the presentation:

Slide 1: Name, date

Slide 2: Problem Recognition Ad

Slide 3: Explanation why it addresses this stage

Slide 4: Information Search Ad

Slide 5: Explanation why it addresses this stage

Slide 6: Evaluation of Alternatives Ad

Slide 7: Explanation why it addresses this stage

Slide 8: Product Choice (Purchase) Ad

Slide 9: Explanation why it addresses this stage

Slide 10: Outcomes (Postpurchase) Ad

Slide 11: Explanation why it addresses this stage

Slide 12: Conclusion

In the conclusion of the slide presentation choose which ad is most effective (overall) and why.

Logistics Run Down:

-No more than 18 slides in length (includes cover page and bibliography)

-Include a cover page and bibliography of sources. Outside sources (esp. learning resources from weeks covered) are encouraged to be cited and used.

-Organize and utilize the headings given above.

-No more than 2 grammatical/spelling errors are allowed (please proof before submitting).

-Text is required to be in Times Roman, 12 pt font, double space the text.

- Keep voice in business third person. Do not include visuals in text analysis, if need to add create an appendix and refer your reader to such.

A. There are some "status goods" like Rolex watches, that people want to own because they are expensive. In contradiction to the law of demand, if Rolex watches were less expensive, few "status-seeking" consumers would demand them. Reconcile status products or services with the law of demand. How does the existence of cheap "knock-off" imitations of Rolex watches fit with the law of demand?

B. Evidence suggests that babies are a normal good for lower income earners and an inferior good for higher income earners. Use the income elasticity of demand to explain what this means, using the definitions of "normal" and "inferior" goods.

C. Roses sell for about $40 a bouquet most of the year, and worldwide sales are 6 million bouquets per month. Every February, the price of roses doubles to $80 a bouquet, but the quantity of roses demanded and sold also increases, to 24 million bouquets per month. The cost of producing roses doesn't change throughout the year. Can you explain what else is going on that saves the law of demand?

D. Your business is about to launch an advertising campaign, announcing your new low prices. You hope the ads will bring in many more customers. Explain why you need to be concerned about your elasticity of supply.

 

SUMMARY: Sales of non-GMO foods are outpacing organic foods at U.S. grocery stores. This has important implications for the organic food industry which is responding with marketing to educate consumers. Organic foods are also non-GMO. Organic foods are certified by the U.S. Department of Agriculture which sets standards for the use of chemicals, antibiotics and animal welfare. The federal government regulates foods that are labeled organic, but not those labeled non-GMO. The distinction matters to companies because it can take years to be certified organic. It costs thousands of dollars initially and annual renewal is required. Non-GMO sales increased about 70% a year since 2013. This is significant to organic food companies because sales in one category can come at the expense of the other. Non-GMO and organic foods compete for shelf space. There is the perception consumers place a higher value on the non-GMO label than they do on certified organic foods. Non-GMO costs less and customers may feel it is just as good as organic. California Certified Organic Farmers developed a label to communicate that "Organic is non-GMO and more." Other cooperatives are considering marketing efforts to clarify that organic standards encompass non-GMO.

CLASSROOM APPLICATION: As consumer behavior changes, companies need to adapt. Organic foods are both non-GMO and they meet additional federal standards for certification which include the use of pesticides, antibiotics and animal welfare. Consumers seem confused about the differences between non-GMO and organic. This is important for organic food companies because the price of their foods is typically higher than those which are only non-GMO. Educating consumers is the goal of marketing efforts to clarify "Organic is non-GMO and more." The distinction is more important because of changes in consumer behavior which are driving shopping decisions. About 49% of consumers who responded to a poll thought non-GMO was important when shopping for food and beverages while 47% indicated the importance for organic. Consumers are interested in the safety and characteristics of the foods they buy and organic foods face new competition from efforts to market non-GMO foods.

QUESTIONS:
1. (Introductory) Define the term "non-GMO." Why would shoppers demand either non-GMO or organic foods?
2. Compare and contrast the standards and certification process for the non-GMO as compared to the certified organic label.
3. Discuss the efforts of organic food producers to market their products and educate shoppers about what organic certification entails.
4. Some producers think sales of non-GMO foods will boost sales of organic foods. Do you agree? Explain why…

Organic vs. Non-GMO Labels. Who’s Winning?Organic and non-GMO companies push for prominence—and meaning for their labels

Natural-foods makers have spent years going after the industry establishment. Now, they are taking on each other.Surging sales of foods marketed as made without genetically modified crops are outpacing sales of food labeled organic in U.S. grocery stores. That is frustrating some organic companies and farmers, who invest significant sums to meet government organic standards and to get their foods certified.

The organic industry is responding with marketing campaigns touting that its foods—in addition to being made without genetically modified organisms, or GMOs, as such crops are known—also abide by other requirements.

For example, the U.S. Department of Agriculture, which has certified organic foods since 2002, requires that producers also keep out most synthetic pesticides and certain fertilizers, and that animals used to produce organic food can go outdoors year-round and aren’t given hormones or antibiotics.

“Organic is non-GMO,” said Cathy Calfo, executive director of California Certified Organic Farmers, a trade group that recently started promoting a new label to highlight the difference. “Non-GMO is not organic.

The federal government doesn’t regulate non-GMO labeling. Instead, certification is done by private groups, mainly the Non-GMO Project. The Bellingham, Wash., nonprofit doesn’t prohibit the use of synthetic pesticides on crops used as ingredients, or ensure animal-welfare standards. But it says it tests more stringently to ensure GMOs aren’t inadvertently mixed into ingredients during transportation or production.

The distinctions might seem like hairsplitting, but they matter for companies. Earning the Non-GMO Project’s imprimatur or the USDA’s organic certification can take months or years, depending on the item and the applicant backlog. Each can cost thousands of dollars initially, and must be renewed annually—a significant expense for smaller producers. Prices for organic and non-GMO ingredients also are significantly higher than regular ones.

GMOs have become a focus of skeptical consumers. U.S. government agencies and international bodies including the World Health Organization long have said that GMOs—whose DNA is altered to withstand pests or weedkilling sprays—are safe. But the technology’s critics say it facilitates harmful use of pesticides and that GMOs’ safety for human consumption isn’t proven.

That doubt has driven rapid growth for non-GMO foods, which this year are on pace to surpass those of food bearing the USDA’s certified organic seal, according to data compiled by research company Spins LLC.

ENLARGE Non-GMO sales soared by an average of about 70% annually from 2013 through this year, and are expected to top $13 billion this year. That is five times the rate for food tracked by Spins that bears the organic seal, sales of which total nearly $11 billion for the 52 weeks ended Nov 1. The Spins data don’t include sales from Whole Foods Market Inc., a major seller of both categories.

The USDA’s organic certification applies to foods that are 95% or more organic. The Organic Trade Association, whose numbers include estimates of Whole Foods sales and some other retailers not measured by Spins, touts the much larger figure of $35.9 billion in 2014 for foods containing 70% or more organic ingredients.

One category’s growth can come at the expense of another’s, since specialty foods often compete for the same limited shelf space in supermarkets. Last year, foods labeled non-GMO claimed 3.7% of total food sales in U.S. grocery stores, more than the 3.5% for organic items, according to market-research firm Nielsen NV. About 49% of consumers polled by Nielsen called non-GMO an important factor in food-and-beverage shopping, versus 47% for organic.

Organic-food companies say many consumers are confused about the labels’ different attributes. Vernon Peterson, owner of Abundant Harvest Organics in Kingsburg, Calif., says he often receives inquiries about the peaches, persimmons and other crops that his company distributes to customers including Kroger Co. and Whole Foods.

“Even though we [are] a 100% organic company, I get a question or two a week, ‘is any of your produce genetically modified?’” he said. “We see the consumer putting a higher value on the non-GMO than the organic label.”

Megan Westgate, executive director of the Non-GMO Project, said the “relationship between non-GMO and organic is probably the most politically sensitive thing we deal with, and we’re careful not to undermine consumer trust in the organic label.” She said consumer confusion around the definition of organic predates the Non-GMO Project, but she acknowledged that some organic-food producers have expressed concerns about her group infringing on their turf.

‘We see the consumer putting a higher value on the non-GMO than the organic label.’

—Vernon Peterson, owner of Abundant Harvest Organics

Rising non-GMO food sales are “a two-edged sword,” said Oren Holle, a longtime organic farmer in Bremen, Kan. While some consumers may migrate from those to organic foods, Mr. Holle said he worries about “a perception out there that if I buy the non-GMO it’s a little less costly when you run up to the checkout counter, and it’s just about as good.”

Mr. Holle last year participated in an online-video campaign trumpeting organic food’s purported superiority over items that are only non-GMO. The Organic Farmers’ Agency for Relationship Marketing Inc., a cooperative that funded the campaign, is now discussing marketing materials that brand organic as “the real non-GMO.”

California Certified Organic Farmers, based in Santa Cruz, Calif., debuted its new label in March that boasts “Organic is non-GMO & more.” The labels are designed to attract shoppers looking for non-GMO foods while highlighting organic’s curbs on synthetic fertilizers and pesticides, said Ms. Calfo.

Mr. Peterson hopes the new label, which he has added to Abundant Harvest products, will clarify things. “When you have a confused public, it’s never good,” he said.

Some bigger organic brands are more sanguine. George Siemon, chief executive of Organic Valley, the largest U.S. cooperative of organic farms, said that while some consumers may find non-GMO easier to understand, it ultimately will boost organic-food sales by drawing more attention to how food is produced.Still, Mr. Siemon said that Organic Valley is considering adding a non-GMO label to some of its products.