Understanding Consumer Behavior

Consumer Behavior Fundamentals

• Consumer behavior encompasses value-seeking activities as individuals address their needs.
• The study of consumer behavior explores how consumers seek value to fulfill their needs.
• A "want" signifies a consumer's specific desire to address a recognized need.
• "Exchange" involves giving something in return for something of greater perceived value.
• "Costs" represent the negative outcomes of consumption experiences.
• "Benefits" are the positive results of consumption experiences.
• "Consumption" is the process where consumers transform goods, services, or ideas into value.
• Economics examines production and consumption.
• Psychology studies human reactions to environment.
• Social psychology studies people's thoughts, feelings, and behaviors when interacting with others.
• Cognitive psychology studies mental reactions involved in information processing.
• Neuroscience studies the brain mechanisms linked to emotion via the central nervous system.
• Marketing involves value-producing seller activities that facilitate exchanges between buyers and sellers.
• Sociology studies groups within a society, crucial for understanding consumption in group settings.
• Anthropology interprets relationships between consumers, their purchases, and activities.
• A consumer (customer) orientation prioritizes consumer value and satisfaction.
• Market orientation embodies a culture that values creating value for customers among all employees.
• Stakeholder marketing recognizes that more than just buyers and sellers are involved in the marketing process.
• Interpretive research explores the inner meanings and motivations behind specific consumption experiences.
• Qualitative research gathers unstructured data through case analysis, clinical interviews, and focus groups.
• In phenomenology, the researcher offers subjective interpretation of lived experience related to consumption
• Ethnography draws conclusions about consumption interpreting artifacts.
• Netnography studies cultures and communities online.
• Quantitative research uses numerical data to look at consumer behavior.
• "Big data" represents the vast amounts of data potentially used to predict consumer behaviors.
• Predictive analytics applies statistical tools to find patterns in data for predicting consumer behavior.
• Relationship marketing aims to improve a firm's performance through repeat business.
• Touchpoints are direct lines of communication between a firm and a customer.
• Resource-advantage theory explains how firms succeed or fail through acquiring resources from consumers in return for the value the resources create.
• An "attribute" is a tangible part of a product that delivers a benefit of consumption.
• A "product" is a bundle of benefits.
• Undifferentiated marketing offers the same basic product to all customers.
• Production orientation gears innovation toward efficient and economic production.
• Differentiated marketers serve firms that serve multiple market segments with unique offerings.
• "One-to-one marketing" offers an individual marketing plan wherein a different product is offered for each individual.
• Niche marketing firms specialize in serving one market segment with particular demand characteristics.

Consumer Behavior Value Framework

• The Consumer Value Framework (CVF) outlines factors shaping consumption behaviors and value.
• Customer Relationship Management (CRM) is a system for collecting and reporting customer data to enable a customer-oriented approach.
• The degree of connectedness between a consumer and a brand is "relationship quality".
• "Service" refers to an organization's efforts toward value creation.
• Internal influences are psychological traits that are part of a consumer.
• "Cognition" refers to thinking or mental.
• "Affect" refers to feelings about objects or activities.
• "Individual differences" include demographics, personality, and lifestyle.
• External influences are social and cultural aspects that are part of a consumer's life
• The "social environment" involves how other people influence consumer decision making and value.
• "Situational Influences" affect consumer decision making and value received.
• "Value" is a personal assessment of net worth obtained from activity.
• "Utilitarian value" helps a consumer solve a problem or accomplish a task.
• "Hedonic value" comes from immediate gratification.
• "Strategy" is a planned approach to achieve goal.
• A "Marketing strategy" helps create value for customers.
• "Marketing myopia" views a company as a product, not value.
• "Corporate strategy" defines a firm's general goals.
• "Marketing tactics" implement marketing management.
• Product placements can be found in movies or television shows
• "Augmented product" involves the physical product purchased plus any services to use the product and obtain its benefits.
• "Total value concept" is understanding that products provide values multiple ways.
• "Value co-creation" is a consumer necessary to partake in the production of value.
• The "marketing mix" helps implements marketing strategy.
• The "target market" that a company serves can be identified segment/segments.
• "Market segmentation" separates a market into groups.
• "Elasticity" is how sensitive a consumer is to changes of a product.
• "Product differentiation" is the condition in which consumers do not view all competing products as identical to one another.
• "Product positioning" is the way a product is perceived by the consumer.
• "Perceptual maps" are used to depict competing products.
• "Blue ocean strategy" positions a company away from competitors.
• The "ideal point" combines product characteristics to provide consumer or market segment.
• "Customer lifetime value (CLV)" indicates the approximate worth of a customer to a company in economic terms.

Consumer Learning Perception

• "Learning" represents changes in behavior due to interaction between a person and a stimulus.
• "Perception" is a consumer's awareness of reality.
• "Exposure" brings a stimulus within proximity for a consumer to sense it.
• "Sensation" is a consumer's immediate response to stimulus.
• "Sensory marketing" seeks to engage consumers' senses.
• "Attention" allocates the information processing capacity
• "Cognitive organization" is the process by which the brain assembles sensory evidence into something recognizable.
• "Assimilation" results when a stimulus has characteristics where consumers readily recognize it as something familiar.
• "Accommodation" requires consumers to process exceptions to rules about the category.
• "Contrast" occurs when a stimulus does not share enough in common with existing categories for it to allow categorization.
• "Anthropomorphism" gives humanlike characteristics to inanimate objects.
• "Selective exposure" involves screening out stimuli and exposing to others.
• "Selective attention" involves only paying attention to certain stimuli.
• "Selective distortion" happens when consumers interpret information in biased ways based on prior beliefs.
• "Subliminal processing" is when the brain deals with low-strength stimuli, below conscious awareness.
• "Absolute threshold" is the minimum stimulus strength to be perceived.
• "Subliminal persuasion" is behavior change induced by subliminal processing.
• "Just noticeable difference (JND)" occurs when a stimulus is stronger for someone to notice the difference.
• Weber's law states that a consumer's ability to detect differences between two levels of a stimulus decreases as the intensity of the initial stimulus increases.
• "Just meaningful difference (JMD)" is the smallest needed amount of change in a stimulus that would influence consumer consumption and choice.
• "Explicit memory" develops when a person is exposed to and tries to remember information.
• "Implicit memory" is for remembering things that a person did not try to remember.
• "Preattentive effects" are learning that happens without attention.
• "Mere Exposure Effect" leads consumers to prefer a previously exposed stimulus.
• "Mere association effect" transfers of meaning between objects accidentally.
• "Product placements" are in movies or television shows.
• "Involuntary attention" is automatic, beyond conscious control.
• "Orientation reflex" is a natural reflex to a threatening event.
• "Involvement" signifies personal relevance for a particular product.
• "Unintentional learning" modifies behavior through a consumer-stimulus interaction
• "Intentional learning" helps consumers learn devote certain information.
• The "behaviorist approach to learning" focuses on behavioral changes due to association.
• The "information processing prospective to learning" focuses on the cognitive processes associated with comprehension.
• "Classical conditioning" is change in behavior associating one stimulus with another.
• "Unconditioned stimulus" already has behavioral response.
• "Conditioned Stimulus" requires pairing with unconditioned stimulus to cause desired response.
• "Unconditioned response" occurs as a result of unconditioned stimulus.
• "Conditioned response" results from being exposed to the conditioned Stimulus.
• "Instrumental Conditioning" reinforces punishment/rewards.
• "Positive reinforcers" are rewards.
• "Discriminative stimuli" occur in the presence of reinforcers.
• "Shaping" modifies behavior over time in small increments.
• "Punishers" are stimuli that decrease bad the likelihood of bad behavior.
• "Extinction" ceases behaviors through lack of reinforcement.

Comprehension, Memory, and Cognitive Learning

• "Comprehension" is the way people cognitively assign meaning to things they encounter.

• "Signal theory" explains ways in which communications convey meaning.

• The "price matching guarantee (PMG)" guarantees a product will be at a certain price.

• "Physical characteristics" are tangible elements of a message.

• The "golden section" is a preferred ratio of objects, equal to 1.62 to 1.00.

• "Message congruity" helps determine if a message makes sense and is internally consistent.

• The "figure" on a message captures a person's attention.

• The "ground" is the background in a message.

• "Figure-ground distinction" helps separate focus point from background.

• "Figurative language" uses nonliteral meaning.

• "Expertise" is knowledge perceived to have about subject.

• "Trustworthiness" is how honest and unbiased the source is perceived to be.

• "Credibility" means a source is an expert and trustworthy.

• "Counterarguments" contradict message.

• "Support arguments" further support message.

• "Habituation" exposure to stimulus affects comprehension

• "Adaptation level" is level of stimulus to which consumer accustomed.

• "Dostats" is a Russian word meaning “acquiring things with great difficulty".

• "Expectations" influence future situations.

• "Brain dominance" has to do with if a consumer is right or left-brain dominant.

• "Metaphor" has a figurative meaning.

• "Information intensity" helps determine amount of information Consumer processes.

• "Framing" influences the perceived meaning of something.

• "Prospect theory" uses framing with risk assessments.

• "Priming" uses environmental concepts and frames affect value and meaning.

• "Construal Level" determines if we have an abstract of concrete mindset.

• "Memory:" helps store knowledge.

• "Multiple Store Theory of Memory" contains sensory, workbench, and long-term.

• "Sensory Memory" stores things exposed to one of the five senses.

• "Iconic storage" stores visual information in sensory memory.

• "Echoic storage" stores auditory information.

• "Haptic perception" is how something feels.

• "Workbench memory" is where information processes before recall.

• "Encoding" is how information gets transferred to long-term.

• "Retrieval" helps bring information back to workbench memory.

• "Repetition" keeps thought alive in short term memory.

• "Dual coding" uses codes when traces available.

• "Meaningful Encoding" information transferred and attached to workbench.

• "Chunking" groups some stimuli together.

• "Cognitive interference" interferes with memory and comprehension.

• A "chunk" is a single memory.

• "Response generation" reconstructs memory traces into recollection.

• "Long-term memory" stores information encountered.

• "Semantic coding" converts meaning.

• "Memory trace" becomes some thought active.

• "Spreading activation" spreads from one concept to another.

• A "tag" helps retrieve knowledge.

• "Rumination" triggers recurrent memories.

• "Nostalgia" attempts to relive the past and linger.

• "Elaboration" is how long the consumer continues process.

• "Personal elaboration" has people imagine themselves relating to a stimulus.

• "Associative network" stores information and knowledge.

• "Declarative knowledge" components that represent factors.

• "Nodes" are concepts found in associative networks.

• Paths" represents the association between nodes.

• "Schema" associates an entity and meaning.

• "Exemplar" schema has the best representative of some category.

• "Prototype Schema" has the best representative of categories.

• "Script Schema" represents event.

• "Episodic memory" accounts for past events.

• "Social Schema" provides type person meaning.

• "Social stereotype" describes schema.

• "Social Identity" defines from Social groups.

Motivation and Emotion Consumer Behavior

• "Sentiment analysis" analyzes social media sites and phrases for emotional meaning.
• "Motivations" are what drives consumers.
• "Homeostasis" is state of equilibrium in body.
• "Self-improvement" helps aim at changing current state.
• "Regulatory focus theory" determines how behavior is focused.
• "Maslow's Hierarchy of Needs" describes consumers addressing a prioritized set of needs.
• "Utilitarian motivation" drives to acquire products to use.
• "Hedonic motivation" drive to experience something emotionally.
• "Consumer involvement" is the personal relevance consumer finds.
• "Moderating variable" help change variable between two variables.
• "Product involvement" defines product relevance.
• "Product enthusiasts" have very high product involvement.
• "Shopping Involvement" is personal relevance of shopping behavior.
• "Situational involvement" interests in temporary purchase.
• "Enduring involvement" ongoing interests.
• "Emotional involvement" is a the type of deep personal interest.
• "Emotion" elicits certain appraisal.
• "Psychobiological" creates both physical and human responses.
• "Visceral responses" lead to physical behavior.
• "Cognitive Appraisal Theory" suggests that specific appraisal thoughts link to specific emotions.
• "Anticipation Appraisal" focuses on the future to elicit emotions.
• "Agency appraisal" reviews responsibility.
• "Equity appraisal" considers event.
• "Outcomes Appraisal" are outcomes that help consumers feel better.
• "Mood" is a general affective state.
• "Mood-congruent judgments" influence values within consumer mood.
• "Consumer affect" is how customer feels about a product.
• "Autonomic measures" record visceral reactions.
• "PAD" self-reports pleasure-arousal- dominance.
• "Bipolar" has emotions and a situation.
• "Flow" is where a high involvement where a consumer engrosses.
• "Emotional expressiveness" shows outward reactions.
• "Emotional intelligence" controls certain situation/ reactions.
• "Emotional effect on memory" elicits better recall for mild.
• "Autobiographical memories" are meaningful events
• "Mood-congruent recall" has consumer to remember if in mood.
• "Schema-based affect" has meaning that is related to schema.
• "Aesthetic labor" helps manages for employee to perform job well.
• Emotional laborexistence helps employee to manage.
• "Self-conscious emotions" are specific and result.
• "Emotional contagion" is where emotion displays influence another.
• "Product contamination" is where feeling are harmed cause others.