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Western University
Management and Organizational Studies
Management and Organizational Studies 1021A/B
Kevin Thompson

Pre-Midterm (Chapters 1 – 8) Chapter 1: An Introduction to Consumer Behaviour - Marketers need to understand the wants and needs of different consumer segments - Market segmentation is an important aspect of consumer behaviour - Consumers can be segmented along many dimensions including: o Product usage o Demographics – objective aspects of a population such as age and gender o Psychographics – psychological and lifestyle characteristics - Emerging developments such as the new emphasis on relationship marketing and the practice of database marketing mean that marketers are much more attuned to the wants and needs of different consumer groups o This is especially important as people are empowered to construct their own consumer space, accessing product information where and when they want it and initiating contact with companies on the internet instead of passively receiving marketing communications o In addition, consumers may be thought of as role players who need different products to help them play their various parts Chapter 2: Perception - Perception is a 3 stage process that translates raw stimuli into meaning - Perception is the process by which physical sensations such as sights, sounds, and smells are selected, organized and interpreted - The eventual interpretation of a stimulus allows it to be assigned meaning - A perceptual map is a widely used marketing tool that evaluates the relevant standing of competing brands along relevant dimensions - Products and commercial messages often appeal to our senses but many of them will not succeed - Marketing stimuli have important sensory qualities. We rely on colors, odors, sounds, tastes, and the feel of products when evaluating them - Not all sensations make their way successfully through the perceptual process though o Many stimuli compete for our attention and the majority are not noticed or accurately comprehended - People have different thresholds of perception o A stimulus must be presented at a certain level of intensity before it can be detected by an individual’s sensory receptors o In addition, a consumer’s ability to detect whether two stimuli are different, the differential threshold, is an important issue in many marketing contexts such as changing a package design, altering a size of a product, or reducing its price - In recent years, the sensory experiences we get from products and services have become even more important when choosing among competing options o Consumers increasingly want to buy things that will give them hedonic value, in addition to functional value o They often believe that most brands perform similarly, so they weigh a product’s aesthetic qualities heavily when they choose - Subliminal advertising is a controversial but largely ineffective way to talk to consumers o A lot of controversy has been sparked by so called subliminal persuasion and related techniques by which people are exposed to visual and audio messages below the threshold o Although evidence of subliminal persuasion’s effectiveness is virtually nonexistent, many consumers continue to believe that advertisers use this technique - Some of the factors that determine which stimuli get perceived above the threshold level are the amount of exposure to the stimulus, how much attention it generates, and how it is interpreted - In an increasingly crowded stimulus environment, advertising clutter occurs when too many marketing related messages compete for attention - The stimuli we do pay attention to are interpreted according to learned patterns and expectations - A stimulus that is attended to is not perceived in isolation, it is classified and organized according to principles of perceptual organization o These principles are guided by a gestalt, or overall pattern o Specific grouping principles include closure, similarity, and figure ground relationships - The final step in the process of perception is interpretation o Symbols help us make sense of the world by providing us with an interpretation of a stimulus that is often shared by others o The degree to which the symbolism is consistent with our previous experience affects the meaning we assign to related objects - The science of semiotics helps us to understand how symbols are used to create meaning - Marketers try to communicate with consumers by creating relationships between their products or services and desired attributes - A semiotic analysis involves the correspondence between stimuli and the meanings of signs o The intended meaning may be literal. For example, an icon, such as a street sign with a picture of children playing o The meaning may be indexical. It relies on shared characteristics. For example, the red in a stop sign means danger o Finally, meaning can be conveyed by a symbol, in which an image is given meaning by convention or agreement of members of a society. For example, stop signs are octagonal while yield signs are triangular - Marketer created associations often take on a life of their own as hype is assumed to be real. This condition is known as hyper reality Chapter 3: Learning and Memory - It’s important for marketers to understand how consumers learn about products and services - Learning is a change in behaviour that is caused by experience - Learning can occur through simple associations between a stimulus and a response, or via a complex series of cognitive activities - Conditioning results in learning - Behavioral learning theories assume that learning occurs as a result of responses to external events - Classical conditioning occurs when a stimulus that naturally elicits a response, an unconditioned stimulus, is paired with another stimulus that does not initially elicit this response. Over time, the second stimulus, the conditioned stimulus, comes to elicit the response as well - Learned associations can generalize to other things, which is important to marketers. This response can also extend to other similar stimuli in a process known as stimulus generalization o This process is the basis for such marketing strategies as licensing and family branding, in which a consumer’s positive associations with a product are transferred to other contexts - There is a difference between classical and instrumental conditioning o Operant, or instrumental conditioning, occurs as the person learns to perform behaviours that produce positive outcomes and avoid those that result in negative outcomes o While classical conditioning involves the pairing of two stimuli, instrumental learning occurs when reinforcement is delivered following a response to a stimulus  Reinforcement is positive if a reward is delivered following a response  It is negative if a negative outcome is avoided by not performing a response  Punishment occurs when a response is followed by unpleasant events  Extinction of the behaviour will occur if reinforcement is no longer received - Observation of others’ behaviour can result in learning - Cognitive learning occurs as the result of mental processes o For example, observational learning takes place when the consumer performs a behaviour as a result of seeing someone else performing it and being rewarded for it - Memory systems work o Memory refers to the storage of learned information o The way information is encoded when it is perceived determines how it will be stored in memory o The memory systems known as sensory memory, short-term memory, and long-term memory each play a role in retaining and processing information from the outside world - Our knowledge of individual products is influenced by other products we associate with them - Information is not stored in isolation, it is incorporated into knowledge structures where it is associated with other related data - The location of product information in associative networks and the level of abstraction at which it is coded help to determine when and how this information will be activated at a later time - Some factors that influence the likelihood of retrieval include: o The level of familiarity with an item o Its salience or prominence in memory o Whether the information was presented in pictorial or written form - Products help us to retrieve memories from our past o Products also play a role as memory markers. They are used by consumers to retrieve memories about past experiences, autobiographical memories, and are often valued for their ability to do so o This function also contributes to the use of nostalgia in marketing strategies - Marketers measure our memories about products and ads o Memory of product information can be measured through either recognition or recall techniques o Consumers are more likely to recognize an advertisement if it is presented to them than to recall one without having any cues. However, neither recognition nor recall automatically or reliably translates into product purchases Chapter 4: Motivation and Values - It’s important for marketers to recognize that products can satisfy a range of consumer needs - Marketers try to satisfy consumer needs but the reasons any product is purchased can vary widely - The identification of consumer motives is an important step in insuring that the appropriate needs will be met by a product - Traditional approaches to consumer behaviour have focused on the abilities of products to satisfy rational needs, utilitarian motives. But hedonic motives, such as the need for exploration or fun, also play a role in many purchase decisions - As demonstrated by Maslow’s Hierarchy of Needs, the same product can satisfy different needs depending on the consumer’s state at the time. That is, whether basic physiological needs have already been satisfied - In addition to his or her objective situation, the consumer’s degree of involvement with the product must also be considered - The way we evaluate and choose a product depends on our d
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