Consumer Behavior: An Introduction

• The following notes covers various aspects of consumer behavior
• Each section highlights key concepts, learning goals, and descriptions, suitable for study and review

Content Description & Readings

• The section contains class content descriptions, learning objectives and proposed practical activities
• Readings are suggested to address theoretical content, with a reference bibliography in book chapters and articles
• Compulsory books include Babin and Harris (2017) and Wanke (2009)
• Other books and research papers are optional, but may enhance comprehension of consumer behavior

Topic 1: Introduction for Consumer Behavior

• Introduces the concept of consumer behavior and its relation to data-driven marketing
• Aims to provide an overview of the Consumer Behavior field
• Aims to educate on how managers can use insights to enhance marketing performance

Topic 1: Learning Goals

• Understanding the meaning of consumption and consumer behavior
• Explain the role of consumer behavior in today's business and society
• Exploring the dynamic field of consumer behavior with respect to technological advances (information and data-driven marketing)

Consumer Behavior Definition

• Activities that take place as people go about addressing and attempting to address real needs
• When motivated by a need, a consumer seeks desirable ways to fulfill it
• Consumer behavior studies consumers through the consumption process
• Consumer behavior studies how consumers seek value to address real needs
• Marketing helps design products with greater value potential
• Understanding consumer behavior improves businesses, public policy, and individual lives

Consumer as a Process

• Consumption represents the process by which consumers use goods, services, or ideas into value
• Marketer and consumer interact to produce value
• The study of consumer behavior is essential for marketing
• It facilitates exchanges between consumers and companies
• It creates value for other stakeholders
• Consumer behavior provides comprehension of "why," "what," and "how" people buy
• Consumers exchange time, money, and energy for value (products, services)

Dynamic Field of CB

• Consumer behavior is constantly evolving
• Marketers respond to consumers in new ways and have historically used technology to communicate
• Billions of global consumers access markets via the Internet 24/7
• Focus on technological changes and the Sharing Economy is important to understand current consumers for value strategies
• Technology changes the ways people communicate with each other
• Digital media like Google, Facebook, Twitter, and Pinterest are good for reaching consumers
• Brands employ spokespeople, live videos, expert content, and promote other media
• Big data can predict customer behaviors with things like scanner data, survey responses, web traffic, social network interactions, and GPS tracking
• The NOVA Marketing Analytics Lab uses artificial intelligence to discover consumer behavior patterns
• The NOVA Marketing Analytics Lab's discoveries enable better prediction using several Machine Learning algorithms

Topic 1: Bibliography

• Babin, B. and Harris, E. (2017). Consumer behavior (CB8). South-Western College Pub - Chapter 1
• Blackwell, R., Miniard, P., Engel, J. (2005). Consumer Behavior. South-Western College Pub - Chapter 1
• Calder, Bobby and Alice Tybout (1987), “What Consumer Research Is ...," Journal of Consumer Research, 14 (June), 136-140
• Solomon, M. (2016). Consumer Behavior: Buying, Having, and Being (12th Edition) 12th Edition, Pearson – Chapter 1

Topic 2: Consumer Behavior Model

• Introduce the factors that influence consumer behavior
• Discuss consumer value
• Present the Holbrook Value Types Framework, purchase roles, and the 7 O's Model

Topic 2: Learning Goals

• Comprehending the factors that influence consumers behaviors
• Describing consumer value framework
• Defining the different purchase roles and the 7 O's Model

Main Factors Influencing CB

• Consumers enhance value in their choices
• Consumers are influenced by internal, social, and cultural factors
• Specific marketing strategies can project value delivery
• Topics 4-13 explore internal, social, and cultural influences in depth

Consumers and Value Frameworks

• Value is a key component that consumers consider during behavior
• Value is a personal assessment of the net worth a consumer obtains from an activity
• Value is ultimately pursued, and value captures gratification received during consumption
• Marketing literature suggests two main consumer value frameworks: Babin et al. (1994) and Holbrook (1999)
• The consumer value framework from Babin et al. (1994) describes hedonic and utilitarian values

Utilitarian vs Hedonic Value

• Utilitarian value helps consumers accomplish tasks and solve problems
• Provides a rational explanation for purchase
• Hedonic value is the immediate gratification from an activity
• It differs from utilitarian value as an end, is emotional and subjective, and is difficult to explain objectively

Types Of Value (Not Mutually Exclusive)

• Utilitarian and hedonic values are not mutually exclusive
• The same act of consumption can provide both
• The best consumer experiences deliver both high utilitarian value and high hedonic value
• Thinking of these opposites creates an important marketing strategy question
• Firms that offer low amounts of both types of value are failing

The Holbrook (1999) Value Framework

• Organizes consumer values into efficiency, excellence, status, esteem, play, aesthetics, ethics, and spirituality
• Each value can be extrinsic/intrinsic, self/other-oriented, and active/reactive
• Each organization can highlight these to differentiate offers

Purchase Roles

• Marketing must know the customers to define value strategies, because the purchase roles debate is essential, as well as the main purchase roles
• The main purchase roles are the user, the influencers, the initiator, the decider, and the buyer
• The consumer is the user of the product, is the one that companies design its offers to enhance value
• The influencer might influence during the purchase decision process
• The initiator initiates the process and can be the first one that talks about the product
• The decider decides for the purchase and product specifications
• The buyer purchases the product and pays for it

7 O’s Model

• A tool that describes main elements directly related to consumer behavior concerns when buying
• What does the market buy = Objects / Products
• Why does the market buy = Objectives / Motivation
• Who participates in the purchase = Organization / Stakeholders
• Who constitutes the market = Occupants / Consumers
• How does the market buy = Operations / Process
• When does the market buy = Occasions
• Where does the market buy = Outlets (store, online)

Topic 2: Bibliography

• Babin, B. and Harris, E. (2017). Consumer behavior (CB8). South-Western College Pub - Chapter 2
• Babin, B. J., Darden, W. R., & Griffin, M. (1994). Work and/or fun: measuring hedonic and utilitarian shopping value. Journal of consumer research, 20(4), 644-656
• Holbrook, M. B. (Ed.). (1999). Consumer value: a framework for analysis and research. Psychology Press
• Kumar, V. and Reinartz, W. (2016). Creating Enduring Customer Value. Journal of Marketing, 80 (November), 36-68
• Solomon, M. (2016). Consumer Behavior: Buying, Having, and Being (12th Edition) 12th Edition, Pearson – Chapter 2

Topics 3 and 4: Consumer Decision Process

• The goal is to discuss the decision process for consumption by analyzing each of the five activities for consumption
• A goal is to teach how consumers might be influenced during each one
• Present examples to establish how marketers can influence consumer behavior to enhance consumer value

Topics 3 and 4: Learning Goals

• Understanding the activities in the consumer decision-making process
• Analyze the factors that influence consumers driving decision process

Consumer Decision Process

• Consumers encounter unsolved needs and problem situations
• Consumers must make consumption choices every day
• The basic CB consumption process uses main activities that consumers perform as they go about satisfying needs
• The process includes the following five activities, as discussed below
• The process is not referred to as "steps"
• Consumers do not always process through activities in the sequential process, or complete them
• Consumers often face numerous making decisions daily, and simply defer a decision until later

Need Awareness

• The decision-making process begins in this step
• Recognition of a need happens when a consumer perceives a difference between an actual and desired state
• Actual state is perceived current state vs desired state
• The gap between the two is what starts the recognition
• Desired states can be affected by reference group information, consumer novelty seeking, and cognitive thought processes
• Consumers can plan actions by anticipating future needs
• The recognition of a need doesn't always trigger recognition quickly
• Value is important as the end goal, may cause someone to put off the decision
• Case studies are Contrex (French water brand) and Havaianas (Brazilian slippers)
• Contrex changed motivational functions associating products with targets
• Havaianas repositioned brand associating with celebrities

Information Search

• The decision-making process gets trigged when consumers perceive a difference between an tank or full tank
• Consumer information search is the behaviors that consumers engage in as they seek information that can be used to satisfy needs
• Consumers seek all types of information about potential solutions to needs
• The price of various alternatives, attributes to consider their importance, and the performance of the alternative

Consumer Search Behavior

• Search behaviors are categorized in a number of ways including:
• Ongoing search: consumer seeks because she is interested in a topic
• Pre-purchase search
• Internal search: Retrieval of knowledge about products, services, and experiences that are stored in memory
• External search: gathering information from sources external

Search, Continued

• Search has 2 steps which are ongoing and pre-purchase
• Consumers perform ongoing to seek because they are interested in a topic
• Ongoing is performed when consumers have involvement with the product
• Internal search includes retrieval of knowledge stored in a memory including services and experiences
• Memories are scanned to solve problems, so marketers need to understand their total brands to make it easier

External Search

• The consumer gathers information from friends, family, salespeople, advertising, the Internet, and search applications
• The selection of information source depends on ease, speed, objectivity, and trustworthiness
• Information gathered from family and friends is dependable
• Information from sources like advertising is less credible
• Search engines, social networking sites, and smartphone apps, have helped consumers find many solutions

Evaluating Alternatives

• An important part of decision making involves evaluating alternative solutions to problems
• A need is recognized during a search, in which begins the criteria
• Evaluative criteria includes being an attribute, potential benefits, or feature
• A feature is a characteristics of an object, while a benefit is a perceived result
• Consumers evaluate brands that they are known and remembered
• Evoked sets need to be played, and brands need investing to be top of mind in consumers

The Purchase Decision

• The purchase decision involves the moment consumers decide on acquiring resources
• Consumers find that their offer delivers expects value
• The conditions are time, price, and incurred process
• The post-purchase decision includes verifying if a solution satisfies needs in which satisfaction becomes an element
• Satisfaction is a positive milestone that defines a consumption
• Managers consider it important due to word of mouth and loyalty
• Can also include some other overlooked emotions may occur for post consumption reactions,
• The emotions can be anger, emotions, exhilaration, surprise and disgust towards appraisals

Post Purchase

• The final step of consumption is how to dispose a consumer refuse
• Can include a category that has cells, components, and electronics that do not give back valeu
• Conversing, recycling, donating, reselling, trading, and trashing can be options

Purchase Involvement

• Positively associated with search activities, especially for searches that are ongoing, and represents level of interest
• Purchase is known to increase due to possessing high involve purchases, perceived risk, and personal factor and shopping behavior
• Regarding the consumer side, highlighting would be important to Google which highlighted how the search can be carried out

Topic 3 and 4: Bibliography

• The consumer can use these to find out about brand and production: Babin, B. and Harris, E. (2017). Consumer behavior (CB8). South-Western College Pub - Chapters 12, 13 and 14
• Blackwell, R., Miniard, P., Engel, J. (2005). Consumer Behavior. South-Western College Pub - Chapters 3, 4, 5 and 6
• Puccinelli, N. M., Goodstein, R. C., Grewal, D., Price, R., Raghubir, P. and Stewart, D. (2009). “Customer Experience Management in Retailing: Understanding the Buying Process”, Journal of Retailing, 85 (1), 15-30
• Solomon, M. (2016). Consumer Behavior: Buying, Having, and Being (12th Edition) 12th Edition, Pearson – Chapters 9 and 10

Topic 5: Motivation

• Aims to understand the role of motivation for the study of consumer behavior
• A central part of consumer behavior
• Explain how marketing can identify reasons for purchase, and consumer motivation

Topic 5: Learning goals

• Understand what motivates human behavior
• Analyze and classify basic consumer motivations

Consumer Motivation

• Motivations are the inner reasons or driving forces behind actions that drive consumers to address real needs, as well as reason
• Human motivations are oriented around key behaviors including:

Consumer Motivation Types

• Homeostasis - motivation is aimed at maintaining a current acceptable state.
• Self-improvement results, driven by driven-self motivation that behavior will change
• Regulatory Focus suggests that a concept that consumers will orient with behaviors through promotional, promotional can make needs and goals
• Prevention terminology captures homeostasis and promotion focuses

The Motivation Process And Theory

• Learning leads to tension
• Goals are learned, unfulfilled needs, behavior, and desires.
• Processes that cause reduction
• Described by Maslow's hierarchy of need to describe a final state with:
• Security to be safe for survival
• Self-Accusation will need to feel love

Maslow And Motives

• People search for basic value and to satisfying needs to get food
• Higher esteem and higher income that give safe self-fulfillment
• Needs are fulfilled by basic value and can increase with elaborate value from needs and CB (consumer behavior.
• These motivations can classify products with some hedonic value

Topic 5: Bibliography

• Babin, B. and Harris, E. (2017). Consumer behavior (CB8). South-Western College Pub - Chapter 5
• Blackwell, R., Miniard, P., Engel, J. (2005). Consumer Behavior. South-Western College Pub – Chapter 8
• Crowe, E., and Higgins, E. T. (1997). Regulatory focus and strategic inclinations: Promotion and prevention in decision-making. Organizational behavior and human decision processes, 69(2), 117-132
• Higgins, E. T. (1997). Beyond pleasure and pain. American Psychologist, 52(12), 1280
• Solomon, M. (2016). Consumer Behavior: Buying, Having, and Being (12th Edition) 12th Edition, Pearson – Chapter 5

Topic 6: Emotions

• The study for students is to see how emotions affect consumers behavior.
• Role of emotions is possible and helps create value

The definition of Emotions

• Classification and definition for consumer importance
• Goal topics for learning
• Describe what they do with shaping value
• How should we measure consumer emotions?

The Consumer of Emotions

• The Content Description refers to specific psychological appraisals to behavior and states the consumer act immediately
• Psychologists debate that different codes of emotions are especially for consumer usage

Relevant Behavior

• Anticipatory appraisal such as anxiety
• Agency appraisal: responsibility for events that evoke gratefulness
• Equity appraisal: can happen when it is warm or anger
• Outcome appraisal considers how outcomes can be joyful
• Many consumer researchers focus mainly in consumer shaping to provide values and measurement

Emotions, The Options And PANAS

• CB has high technology for measuring emotions that needs self self-assessment
• PAD means three proposed dimensions of pleasure-arousal-dominance, which has a theory for what is important, so the theory may need measuring
• PANAS is positive, affect and negative as it uses the PANAS scale to see an emotion

Topic 6: Bibliography

• Babin, B. and Harris, E. (2017). Consumer behavior (CB8). South-Western College Pub - Chapter 5
• Blackwell, R., Miniard, P., Engel, J. (2005). Consumer Behavior. South-Western College Pub – Chapter 10
• Havlena, W. J., and Holbrook, M. B. (1986). The varieties of consumption experience: comparing two typologies of emotion in consumer behavior. Journal of consumer research, 13(3), 394-404
• Machleit, K. A., and Eroglu, S. A. (2000). Describing and measuring emotional response to shopping experience. Journal of Business Research, 49(2), 101-111
• Richins, M. L. (1997). Measuring emotions in the consumption experience. Journal of consumer research, 24(2), 127-146
• Solomon, M. (2016). Consumer Behavior: Buying, Having, and Being (12th Edition) 12th Edition, Pearson – Chapter 5
• Watson, D., Clark, L. A., and Tellegen, A. (1988). Development and validation of brief measures of positive and negative affect: the PANAS scales. Journal of personality and social psychology, 54(6), 1063

Topic 7: Perception

• Consumers should believe that perception is a main factor in attribute, consumers should believe that a product that is superior and deliver
• The process in the topic includes relations to the behavior of the phases of consumer perception

Goals and Definitions

• Define the perception concept for consumer behavior
• How the consumer should access to this perception, and the process
• The ways consumer see the world is a consumer awareness, which includes meaning

Consumer Action

• Be aware, and interrupt what to do in each Environment
• Perception has been and is influences by what to do
• Shapes how people learn and act
• Perception is reality
• Helps develop an easy way to see why people should always see the world

Topic 7: The Exposure Model

• Consumer are known to stimuli and comprehend with other the stimuli and exposure process that happens in an human sense for sound touch and other sensations
• Information captured happens differently and marketers need to actively engage to see more details so that the value becomes apparent
• Accordingly there includes there phrases which a consumer needs to react with the sensation, organize, and react during
• Sensing includes making first contact and the process which attention is paid, sensing can help give way to a next perspective, because more effortful thoughts means the other sensations have influenced everything

The Organizational Process Of The Brain

• Consumes need to think about how the human can assemble something, and brains organize by looking a the perceptions
• This means an initial effect can can categorize, with cognitive meaning or that can be simple
• The brain starts to continue when the consumers has encounter something
• When an individual has an event to do so they are allowed something special
  • Stimuli that can help categorize to individuals
  • Accommodations that allow to fit into new categories
  • The final approach will be the contrast, something for special to memorize easily