Transcript CB Lecture

Consumer Behavior
Consumer behavior: consists of
the actions a person takes in
purchasing and using products
and services, including the mental
and social processes that come
before and after these actions.
4-2
Influences on the consumer purchase
decision process from both internal and
external sources
4-4
Perception
Perception is the process by
which an individual selects,
organizes, and interprets
information to create a
meaningful picture of the world.
4-5
In marketing:
“Perception is reality.”
In art:
“Is all what we see or seem
but a dream within a dream.”
Edgar Allan Poe
1809 - 1849
In politics:
“Power is the ability to define
phenomena.”
Huey Newton
1942 - 1989
1. Perception
Encoding
Stimulus
Receptor
Codes
SIS
SIS
Filter
Attention
Expectations
Motives
Attitudes
Gestalt
Organization
Closure
Proximity
Common Fate
Figure-ground
PH
Perception
Perceptual Hypothesis
Memory
Feedback
Principles of Sensation
1. Only change is recognized
2. The ability to detect is based on the amount of the stimulus
Thresholds:
Absolute
JND (Just noticeable difference)
S. S. Stevens
Package volume and price
Perceptual Defense
Smoking study
Sherif’s Theory
Subliminal Advertising
Perceptual Defense
Sherif’s Theory
Perceptual Defense
Subliminal advertising
Perceptual Defense
Jean Piaget
Schemata
Assimilation
Accommodation
1896 - 1980
Perceptual Equilibrium
Cognitive Dissonance
Perceptual Equilibrium
Cognitive Dissonance
Other perceptual factors
Color
Other perceptual factors
Size
Square Root Law
Impact
Other perceptual factors
Social factors
Halo effect
Being attractive is good
Jane is attractive
therefore Jane is good!
Other perceptual factors
Social factors
Stereotypes
Other perceptual factors
Social factors
Similarity
Other perceptual factors
Social factors
Initial impressions
Other perceptual factors
Perceived risk
People are not good at calculating actual risk…

What to do about it: Perceived Risk
• Obtain Seals of Approval
• Secure Endorsements
• Provide Free Trials/Samples
• Give Extensive Instructions
• Provide Warranties/Guarantees
• Allow customers to disconnect
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Learning
A relatively permanent change in behavior due
to prior experience.

Behavioral Learning
Classical conditioning
Appetite Appeal
4-34
Classical Conditioning
Ivan Pavlov
1849 - 1936
Is a brain necessary for
learning?

Behavioral Learning
Operant conditioning
4-37
Law of Effect
The probability of behaviors followed
by a “satisfying” state of affairs increases,
while probability of behaviors followed
by a “dissatisfying” state of affairs decreases.
Edward Thorndike
1874 - 1949
Behaviorism
Behaviors are dictated only by the environment
and by Thorndike’s Law.
B. F. Skinner
1904 - 1990
It thinking necessary
for learning?
Extremely important to:

Behavioral Learning
• Stimulus Generalization
• Stimulus Discrimination
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
Cognitive Learning

Brand Loyalty
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Attitudes and Attitude Change
Attitudes: Learned predispositions to
respond to an object or class of objects
in a consistently favorable or unfavorable way.
Attitudes and Attitude Change
1. They are learned
2. They are predispositions
3. They are consistent
4. They are the link between
perception and behavior
5. They are a “hypothetical construct”
Why do customers have them?
1. Organize knowledge
2. Ego-defense
3. Value
4. Utilitarian (tools)
Changing
attitudes
1. Consistency
2. Communications
Consistency
1. Reactance Theories
Establishing and maintaining freedom
Consistency
2. Cognitive Dissonance
Festinger (grasshoppers)
Leon Festinger
1919 - 1989
Consistency
2. Cognitive Dissonance
Pro-Obama article
Consistency
2. Cognitive Dissonance
Post purchase dissonance
Consistency
3. Social judgment theories
Sherif
Heider’s Balance Theory
Consistency
4. Congruity theories
Linkage to positive or negatives
Attitude Change and Communication
Attitude Change and Communication
1. Source credibility
Expertise and familiarity
The “Sleeper Effect”
Attitude Change and Communication
2. Source physical attractiveness
Halo Effect
Why?
Gets attention
Gives information
Minimizes cognitive
dissonance
Works
Attitude Change and Communication
3. Source likeability
Factors
Similarity (unless….)
Speed of speaking
http://www.youtube.com/watch?v=0MBzYZVzJCY
Errors
Known factors
(As seen on TV!)
Attitude Change and Communication
4. Message factors
Repetition (two factor theory)
Words vs Pictures
Vivid or Abstract
Attitude Change and Communication
4. Message factors
Comparative
One-sided vs. two-sided
Drawing conclusions
Primacy or Recency Effects
Attitude Change and Communication
5. Receiver Emotions
a. Feeling good
Humor (What is funny?)
Attractiveness
Sex… food….
Music
Flattery
Good news
Attitude Change and Communication
5. Receiver Emotions
a. Feeling bad
Works or doesn’t work?
Protection Racket
Al Capone
1899 - 1947
Hierarchy of Effects
Learning Hierarchy
Cognition
Affect
Behavior
Hierarchy of Effects
Emotion Hierarchy
Affect
Behavior
Cognition
Hierarchy of Effects
Behavior Hierarchy
Behavior
Affect
Cognition
Customer Decision Making
Involvement & Decision Complexity

Low Involvement
• Maintain Product Quality
• Avoid Stockouts
• Reduce Cognitive
Dissonance with Ads

High Involvement
• Use Comparative Ads
• Use Personal Selling
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Customer Decision Making
Involvement
Low
High
High
Impulse
Buying
Complex
Decision
Making
Low
Inertia
Brand Loyalty
Complexity
Comparison of problem-solving variations:
extended, limited, and routine
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Consumers use search, experience, and
credence properties to evaluate services
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The purchase decision process consists of
five stages:
Ideal
Opportunity
Actual
Need
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2. Information Search
Internal Search
Awareness Sets
Evoked set
50% to 70% of all purchases
2. Information Search
External Search
How much:
Involvement
Perceived Risk
Time Pressures
Customer Characteristics
Familiarity and Expertise
Ignorance paradox
3. Alternatives Evaluation
Models:
Compensatory
Non-compensatory
Conjunctive Bottom up
Lexicographic Top down
Heuristic
Satisficing
4. Purchase
5. Post-Purchase Experience
All products are evaluated!
Expectancy Disconfirmation model
Equity Theory What is fair?
Cognitive Dissonance
Contrast Effects
Valence
Post-Purchase Experience
Buyer’s Regret
+
Reactance
Dissonance
Time

Personality

Traits

Self-Concept
4-76
Personality and Lifestyle
Sigmund Freud
1856 - 1939
Personality and Lifestyle
Carl Jung
1875 - 1961
Personality is related to consumer behavior
but
No one knows how it works!!!
Values and lifestyle:
VALS™ identifies eight consumer segments
INNOVATORS
Sophisticated,
Change Leading,
Active, Take Charge
ACHIEVERS
Successful, Career &
Family Oriented,
Moderate
THINKERS
EXPERIENCERS
Information Seeking,
Satisfied,
Reflective
Risk Seeking,
Enthusiastic,
Impulsive
BELIEVERS
MAKERS
Conservative,
Conventional,
Traditional
Homegrown, Self
Sufficient, Macho,
Family Oriented
STRIVERS
Trendy, Approval,
Seeking,
Disenfranchised
SURVIVORS
Passive,
Risk Averse,
Constrained
Copyright © 2010 by Strategic Business Insights. All rights reserved.
4-80
Take the VAL’s Test
http://www.strategicbusinessinsights.com/vals/presurvey.shtml
Take a personality test
http://personality-testing.info/tests/BIG5.php
Hierarchy of needs
Abraham Maslow
1908 - 1970
4-82
Group Influence
A group is a social structure in which people
have common goals.
Groups establish:
1. Norms
2. Roles
3. Status
4. Conformity
Types of Groups:
1. Membership groups
Formal
Informal
Types of Groups:
2. Non-membership groups
Aspirational
Avoidance
Usage
Private - Necessity
Private – Luxury
Public - Necessity
Public - Luxury
Rule
little influence of groups
influence what but not which
influence which but not what
influence both what and which
Social Class
A social stratification of persons with
shared values, attitudes, and behaviors.
In the U.S., social class is mostly a matter of:
1. Education
2. Occupation
Not INCOME!
Social Class
Privilege
In U.S.
Education
Occupation
Stores and shopping
Perhaps nothing in the U.S.
more segmented by social class!
SOCIOCULTURAL INFLUENCES
ON CONSUMER BEHAVIOR
PERSONAL INFLUENCE

Opinion Leaders

Word of Mouth
• Buzz
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SOCIOCULTURAL INFLUENCES
ON CONSUMER BEHAVIOR
FAMILY INFLUENCE

Consumer Socialization

Family Life Cycle
4-95
Modern family life cycle stages and flows
4-96
SOCIOCULTURAL INFLUENCES
ON CONSUMER BEHAVIOR
CULTURE AND SUBCULTURE

Culture
• Hispanic
Buying
Patterns

• African
American
Buying
Patterns
Subcultures
• Asian
American
Buying
Patterns
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Culture and Subculture
Some basic definitions :
Racial subcultures
Ethnic subcultures
High and low context
De-ethnicization
Culture and Subculture
Some basic definitions :
Micro cultures:
Shared ID with an activity or art form
Norms
Culture and Subculture
Clyde Kluckhohn
1905 - 1960
1. Time
a. Past-Present-Future Orientation
b.Monochronomatic vs Polychronomatic
c. Basic nature of time
Linear
Circular
Procedural
2. Individual relation to nature
a. Subjugated
b. In harmony
c. Mastery over
3. Individual relation to others
a. Traditional
b. Democratic
c. Individualistic
4. Personal activity
a. Being
b. Becoming
c. Doing