Consumer Behavior: Segmentation Strategies

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Questions and Answers

Which scenario exemplifies negative reinforcement?

  • A student receives extra homework for misbehaving in class.
  • An employee avoids being late to work to prevent a pay dock. (correct)
  • A child is given a treat for completing their chores.
  • A shopper receives a discount for purchasing a specific quantity of an item.

Frequency marketing programs primarily leverage which type of learning?

  • Observational learning.
  • Punishment.
  • Positive reinforcement. (correct)
  • Cognitive learning.

A person sees someone being praised for using a specific brand of shampoo and then decides to switch to that brand. Which form of learning is this?

  • Classical conditioning.
  • Rote memorization.
  • Instrumental conditioning.
  • Observational learning. (correct)

Which type of memory is most closely related to schemas?

<p>Semantic memory. (A)</p> Signup and view all the answers

A company notices that 80% of its revenue comes from 20% of its customer base. Which segmentation rule does this exemplify?

<p>The 80/20 rule (B)</p> Signup and view all the answers

What is the primary difference between short-term and long-term memory?

<p>Short-term memory has a brief storage duration and limited capacity, while long-term memory has a relatively permanent storage and unlimited capacity. (A)</p> Signup and view all the answers

According to the associative network theory, how does the activation of one node influence related information?

<p>It activates other linked nodes through a process called spreading activation. (A)</p> Signup and view all the answers

A marketing campaign focuses on appealing to consumers' sense of touch, smell, and sight to influence their perceptions and behavior. What type of marketing strategy is this considered?

<p>Sensory marketing (B)</p> Signup and view all the answers

A student is driven to study diligently for an exam because they expect that a good grade will lead to better job opportunities. Which motivational theory best explains this behavior?

<p>Expectancy theory. (B)</p> Signup and view all the answers

A consumer is extremely loyal to a particular brand of coffee due to its consistent taste and aroma, and they always repurchase it. Which type of segmentation is best represented by this behavior?

<p>Behavioral segmentation (C)</p> Signup and view all the answers

Which of the following best describes the 'endowment effect' in consumer behavior?

<p>Consumers perceive higher value in items they own. (C)</p> Signup and view all the answers

A consumer purchases organic food because they believe it is healthier and better for the environment, demonstrating a concern for objective and functional attributes. Which type of need is primarily driving this purchase?

<p>Utilitarian needs. (B)</p> Signup and view all the answers

A toy manufacturer releases a slightly updated version of a classic toy from the 1980s, aiming to evoke positive memories and feelings in older adults who played with the toy as children. Which of the following concepts does this marketing strategy primarily leverage?

<p>Nostalgic attachment (B)</p> Signup and view all the answers

Which of the following scenarios demonstrates the concept of 'just noticeable difference' (JND)?

<p>A company increases its product price just below the threshold that consumers notice. (B)</p> Signup and view all the answers

According to Weber’s law, if a consumer can barely notice the difference in brightness between a 100-watt bulb and a 110-watt bulb, what wattage would the second bulb need to be for the consumer to notice a difference if the original bulb was 200 watts?

<p>220 watts (A)</p> Signup and view all the answers

A shopper in a grocery store is trying to decide between two bags of chips. Both are the same brand, but one is labeled “25% less fat” and the other is the original formula. If the shopper can’t tell the difference in taste, but chooses the “25% less fat” option because they believe it's healthier, which concept is influencing their decision?

<p>Differential Threshold (A)</p> Signup and view all the answers

A marketing team is designing an advertisement. To effectively capture consumer attention, which strategy would best leverage the principles of stimulus intensity and novelty?

<p>Creating a large, brightly colored ad with unexpected imagery, placed in an unusual location. (C)</p> Signup and view all the answers

Which of the following scenarios exemplifies the Gestalt principle of closure in consumer perception?

<p>A radio ad plays only the first few notes of a well-known song, and listeners instantly recognize the tune. (A)</p> Signup and view all the answers

A new brand of cleaning products uses packaging with similar colors and designs as a well-established, popular brand. Which Gestalt principle are they primarily trying to utilize, and what is the likely goal?

<p>Similarity; to encourage consumers to associate their product with the established brand's positive reputation. (C)</p> Signup and view all the answers

A company initially used a popular song in its advertisements, which led to a significant increase in product sales due to the positive emotions associated with the music. However, after a while, the song was replaced, and sales began to decline. Which of the following best explains this phenomenon in terms of classical conditioning?

<p>The conditioned stimulus (product) was no longer paired with the unconditioned stimulus (song), leading to extinction of the conditioned response (positive feelings toward the product). (E)</p> Signup and view all the answers

An online retailer offers customers a discount code every time they leave a positive review. Over time, the number of positive reviews increases significantly. Which type of learning is the retailer leveraging, and what element does the discount code represent?

<p>Instrumental conditioning; the discount code is a positive reinforcement. (B), Instrumental conditioning; the discount code is a positive reinforcement. (C)</p> Signup and view all the answers

A pet food company initially uses a bell to signal feeding time for dogs, leading them to salivate upon hearing the bell. Over time, the dogs also start salivating when they hear similar sounds, such as a doorbell or telephone ring. Which of the following concepts explains why the dogs react to these other sounds?

<p>Stimulus generalization (A)</p> Signup and view all the answers

A frequent flyer program rewards customers with points for every mile flown, which can be redeemed for free flights. How does this program apply the principles of instrumental conditioning to encourage customer loyalty?

<p>By providing positive reinforcement (reward points) that increase the likelihood of repeat purchases (flights). (B)</p> Signup and view all the answers

A company is trying to rebrand a product that had previously received negative reviews. They launch a new advertising campaign focusing on the product's improved features and positive customer testimonials. According to classical conditioning principles, what must the company ensure to reverse the previously negative associations?

<p>Consistently pair the product with positive stimuli to create new, positive associations that can override the old ones. (A)</p> Signup and view all the answers

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Flashcards

Consumer Behavior

The stages a consumer goes through, from needing something, to buying it, to using it.

Segmentation Strategies

Dividing consumers into groups based on shared characteristics for targeted marketing.

Demographic Segmentation

Categorizing consumers by age, gender, income, and other easily measured traits.

Geographic Segmentation

Categorizing consumers based on where they live and the characteristics of that area.

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The 80/20 Rule

The idea that 80% of a company’s sales come from 20% of its customers.

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Perception

The process of selecting, organizing, and interpreting sensory information.

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Endowment Effect

People value something more highly just because they own it.

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Absolute Threshold

The minimum level of stimulation a person can detect.

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Attention (in marketing)

The extent to which processing activity is devoted to a particular stimulus.

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Gestalt Psychology

A psychological school of thought emphasizing that the mind sees objects as a complete whole before perceiving the individual parts.

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Principle of Closure

People perceive incomplete information as if it's complete.

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Similarity (in perception)

Consumers group objects with similar physical characteristics.

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Figure-ground Relationship

One part of a stimulus dominates (figure), while others recede (ground).

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Learning

Long-term change in memory or behavior due to experience.

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Behavioral Learning

Learning due to responses to external events.

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Classical Conditioning

Pairing a stimulus that elicits a response with one that initially doesn't.

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Positive Reinforcement

Good behavior is followed by rewards, reinforcing the behavior.

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Negative Reinforcement

Removing something negative to reward a behavior, increasing the behavior.

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Punishment

Bad behavior followed by unpleasant consequences, decreasing the behavior.

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Observational Learning

Learning by watching others and the consequences of their actions.

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Script (Memory)

A sequence of events an individual expects to occur in a specific situation.

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Long-Term Memory

Relatively permanent storage of information with unlimited capacity.

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Short-Term Memory

Brief storage of information currently being used, lasting 15-30 seconds.

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Motivation

The driving force behind actions, pushing consumers to address needs.

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Study Notes

  • Multiple choice exam consisting of 32 questions
  • The exam is worth 20 points of the total grade
  • There is a 50 minute time limit

Intro to Consumer Behavior (Chapter 1)

  • Consumer behavior includes pre-purchase, purchase, and post-purchase stages
  • Segmentation strategies are applied in consumer behavior

Demographic Segmentation

  • Based on variables like age, gender, ethnicity, education, occupation, income, and family status
  • Demographic nuances exist

Geographic Segmentation

  • Based on regional variables such as region, climate, population density, and population growth rate

Psychographic Segmentation

  • Based on variables such as values and lifestyle

Behavioral Segmentation

  • Based on variables such as usage rate and patterns, price sensitivity, brand loyalty, and benefits sought

The 80/20 Rule

  • 80% of a company's revenue comes from 20% of total customers

Role Theory

  • Consumer behavior resembles actions in a play
  • Consumers seek products to put on a good performance
  • Nostalgic attachment occurs
  • One of the relationship types a person has with a product is when a product serves as a link with the past self
  • Examples include Jelly cats and Squishmellows

Perception (Chapter 3)

  • Perception is the process by which people select, organize, and interpret sensations
  • Endowment Effect: Individuals value things more if they own them
  • Touch creates psychological ownership

Sensory Marketing

  • Marketing engages consumers' senses, affecting their perception, judgment, and behavior

Sensory Thresholds

  • Areas where stimuli impact awareness
  • Absolute threshold: the minimum stimulation detectable

Differential Threshold

  • The range of change in a stimulus or differences between two stimuli that can be detected
  • Includes Just Noticeable Difference (JND) that represents the minimum change that can be detected
  • Advertisers generally want to exceed the JND
  • Price increases and size decreases

Weber's Law

  • A consumer's ability to detect a difference between two stimuli is relative
  • Attention: Extent of processing activity devoted to a particular stimulus
  • Attention is limited and can be divided through multitasking

Strategies for Enhancing Attention to Ads

  • Intensity, size, contrast, movement, surprise/novelty, and involvement

Gestalt Psychology

  • People interpret meaning from the totality of stimuli rather than individual ones
  • This results in seeing things as wholes rather than parts
  • Principles of closure involves people perceiving incomplete information as if it is complete Similarity: Consumers group objects with similar physical characteristics
  • Figure-ground involves one part of the stimulus dominating as the figure while other parts recede into the background

Learning and Memory (Chapter 4)

  • Learning is long-term memory or behavior change caused by experience or information processing
  • Incidental learning is the unintentional acquisition of knowledge
  • Behavioral learning assumes learning occurs through responses to external events
  • Classical conditioning involves pairing a stimulus that elicits a response with another stimulus that initially does not elicit a response on its own

Pavlov's Experiment

  • Includes neutral stimulus, unconditioned stimulus, conditioned response, and conditioned stimulus

Extinction

  • If the conditioned stimulus (bell) is presented repeatedly without the unconditioned stimulus (food), the conditioned response (salivate) may disappear
  • Stimulus generalization: The conditioned response may occur because of similar stimuli (bell sound - key jangling)
  • Instrumental conditioning/Operant conditioning occurs as individuals learn to perform behaviors that produce positive outcomes and avoid negative ones

Law of Effect

  • If a response is followed by a favorable consequence, that response is strengthened
  • If a response is followed by an unpleasant consequence, it is weakened

Positive Reinforcement

  • Concerns good behavior and rewards, learning that behavior is good for approaching positive outcomes
  • Negative Reinforcement: removing negative stimuli that are rewarding, learning that the removal is beneficial
  • Punishment: Concerns bad behavior and punishment, learning that behavior is bad in order to prevent negative situations
  • Frequency marketing rewards regular purchasers with better prizes as they spend more

Cognitive Learning

  • Observational learning occurs when people watch the actions of others and note the reinforcements they receive
  • Modeling: Imitating the behavior of others

Memory

  • Script: a sequence of events an individual expects to occur
  • Long-term memory is a relatively permanent storage of information
  • Unlimited capacity

Short-Term Memory

  • Consists of briefly storing information currently being used
  • Is 15-30 seconds long with rehearsal and active process
  • Has a limited capacity of 5-9 bits of information
  • Semantic memory is the basic knowledge and feelings an individual has about a concept
  • Episodic memory is a personal unique memory of a specific event
  • Associative network: Spreading activation occurs when a stimulus activates a node in the schema, which then activates linked nodes

Motivation (Chapter 5)

  • Motivation is the driving force behind human actions, pushing consumers to address real needs
  • Need: Perceived lack of something
  • Want: The specific pathway to fill the need gap
  • Expectancy theory is a cognitive approach where expectations of achieving desirable outcomes motivate behavior

Drive Theory

  • Drive theory stems from biological needs
  • Drive is an unpleasant state of arousal
  • Motivation reduces arousal and return to homeostasis
  • Utilitarian needs: Concerned with a consideration of the objective and functional attributes of the product
  • Hedonic needs: Concerned with a consideration of the subjective, pleasurable or aesthetic aspects of the product.
  • Most purchases are pleasure related
  • Maslow's hierarchy of needs concerns physiological, safety, love/belonging, esteem, and self-actualization

Motivational Conflicts

  • Approach-Approach Conflict: Involves 2 desirable alternatives, post-decision dissonance, and bundling benefits together Approach-Avoidance Conflict: Involves desirable and undesirable aspects of a single item (e.g., short-term rewards vs. long-term costs)
  • Avoidance-Avoidance Conflict: Involves 2 predominantly negative alternatives and stressing the unforeseen benefits of choosing one option

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