Global Consumer Behavior Final Exam Preparation.docx

Global Consumer Behavior Final Exam Preparation **1. Chapter 9. Learning & Memory** a\. What are the differences between short-term and long-term memory? Short-term memory (STM) deals with holding information temporarily while it is interpreted and transferred into long-term memory. STM = working...

Global Consumer Behavior Final Exam Preparation **1. Chapter 9. Learning & Memory** a\. What are the differences between short-term and long-term memory? Short-term memory (STM) deals with holding information temporarily while it is interpreted and transferred into long-term memory. STM = working memory, in use, analogous to thinking, active, dynamic process. Long-term memory (LTM) deals with storing and retrieving information to be used in decisions. LTM = permanent info storage, unlimited, permanent storage, store concepts, decision rules, processes, affective states (emotional). - STM has 3 characteristics: \~ short lived \~ has limited capacity. \~where elaborative activities take place. b\. What is maintenance rehearsal? Maintenance rehearsal is the continual repetition of a piece of info in order to hold it in current memory for use in problem solving or transferal to long-term memory. c\. What is schema? Schema is a mental framework or organized structure of knowledge that represents our understanding of a particular concept, category, or domain. d\. What are the differences between low-involvement and high-involvement learning? High involvement learning situation in which the consumer is motivated to process or learn the material. Low involvement learning situation is one in which the consumer has little or no motivation to process or learn the material. e\. What are the differences between classical and operant conditioning? Operant conditioning -- learning from consequences, where behaviors are strengthened or weakened based on the outcomes they produce (in high-involvement situations). - The individual's response is instrumental in getting a positive reinforcement (such as reward) or negative reinforcement (like punishment). Classical conditioning -- associating stimuli (in low-involvement situations). This involves learning to associate a neutral stimulus with a meaningful stimulus to elicit a reflexive response (ex: dog and sound of bell). Ex: pairing popular music with brand and brand itself might elicit positive emotions. f\. What is shaping? Shaping is the process of gradually molding or "shaping" a desirable behavior by reinforcing successive approximations of that behavior. Instead of waiting for the full behavior to occur spontaneously, shaping involves rewarding behaviors that are increasingly similar to the target behavior until the desired behavior is achieved. E.g., Using shaping with free samples involves initially offering free samples of a product to consumers. **2. Chapter 10. Motivation, Personality, & Emotion** a\. What is motive? Motive is a construct representing an unobservable inner force that stimulates and compels a behavioral response and provides specific direction to that response. b\. What are the four premises of Maslow's Hierarchy of Needs? −All humans acquire a similar set of motives through genetic endowment and social interaction. −Some motives are more basic or critical than others. −The basic motives must be satisfied to a minimum level before other motives are activated. −After basic motives are satisfied, more advanced motives come into play. c\. What are the differences between manifest and latent motives? Manifest -- motives that are known and freely admitted. Latent -- motives that are unknown to the consumer or reluctant to admit them. d\. What are the three types of motivation conflict and their examples? \- Approach-Approach: a choice b/w 2 attractive alternatives. \- Approach-Avoidance: a choice with both positive and negative consequences. \- Avoidance-Avoidance: a choice involving only undesirable outcomes. e\. What is regulatory-focused theory and its two motives (promotion-vs. prevention-focused)? Regulatory focus theory suggests that consumers will react differently depending on which broad set of motives (promotion-focus or prevention-focus) is most salient(= more important). - promotion-focus: consumers seek to gain positive outcomes (affect, emotion). - prevention-focus: consumers seek to avoid negative outcomes (facts, accuracy). f\. What is personality? Personality is an individual's characteristic response tendencies across similar situations. g\. What is consumer ethnocentrism? Reflects an individual difference in consumers' propensity to be biased against the purchase of foreign products. h\. What are the five dimensions of brand personality and their examples? Sincerity: down-to-earth, honest, wholesome, cheerful. Excitement: daring, spirited, imaginative, up to date. Competence: reliable, intelligent, successful. Sophistication: upper class, charming. Ruggedness: outdoorsy, tough. i\. What are the three dimensions of emotion? \- Pleasure: how pleasant or unpleasant one feels about something. ▪ E.g., Anger is an unpleasant emotion, while joy is a pleasant emotion. −Arousal: how energized or soporific one feels. −Dominance: the controlling and dominant versus controlled or submissive one feels. j\. What is consumer emotional intelligence? Consumer Emotional Intelligence is an important determinant of effective consumer coping. ▪ Consumers higher in emotional intelligence are better at perceiving, facilitation, understanding, and managing emotional information. **3. Chapter 11. Attitudes & Influencing Attitudes** a\. What is attitude component consistency? The degree of alignment among the cognitive, affective, and behavioral components of an individual\'s attitude towards a particular object, person, group, event, or idea. E.g., If someone holds a positive attitude towards environmental conservation, they may believe that conservation efforts are important (cognitive component), feel a sense of concern or empathy for the environment (affective component), and engage in behaviors such as recycling or reducing their carbon footprint (behavioral component). b\. What is the Elaboration Likelihood Model (ELM) and its two main routes through which attitude change can occur (central vs. peripheral routes)? The Elaboration Likelihood Model (ELM) offers insights into how attitudes are changed or influenced through persuasive communication. - When individuals are motivated and capable of processing a persuasive message deeply, they are likely to engage in the **central route** to persuasion. This involves carefully evaluating the content of the message, considering the strength of the arguments, and critically analyzing the information presented. - When individuals are less motivated or unable to process a message deeply, they may rely on peripheral cues or superficial aspects of the message to guide their attitude change. This is known as the **peripheral route** to persuasion. Peripheral cues can include factors such as the attractiveness of the source, the emotional appeal of the message, or the presence of catchy slogans or jingles. Elaboration Likelihood Model (ELM): What it is: A theory about how people are influenced by persuasive messages and how their attitudes can change. Central Route to Persuasion: What it means: When people are very interested in a topic and able to think about it deeply, they focus on the actual content of the message. They carefully evaluate the arguments and evidence. Example: Buying a Car: If you are really interested in buying a car and want to make a good decision, you will pay close attention to the car\'s features, safety ratings, fuel efficiency, and expert reviews. You\'ll think critically about whether the arguments for buying the car are strong and logical. Peripheral Route to Persuasion: What it means: When people are not very interested or are unable to think deeply about a topic, they focus on superficial aspects of the message. These aspects, called peripheral cues, can include things like the attractiveness of the person delivering the message, catchy slogans, or emotional appeal. Example: Buying a Snack: If you see an ad for a new snack and you\'re not really thinking much about it, you might be influenced by the fun jingle in the ad or the fact that your favorite celebrity is endorsing it, rather than the actual ingredients or health benefits of the snack. Summary: Central Route: Deep thinking about the message\'s content. Used when you care a lot about the topic and have the ability to analyze it. Peripheral Route: Superficial thinking based on easy-to-process cues. Used when you don\'t care much about the topic or can\'t analyze it deeply. c\. What are the exceptions to cue relevance? Cue Relevance: What it is: How important certain information is to consumers when they make decisions. Product Type: What it means: The importance of information can change depending on what product is being advertised. Example: Car Advertisement: If you see an ad for a car, you might not care much about the attractive model in the ad (peripheral cue). Instead, you\'re more interested in the car\'s features like safety and fuel efficiency (central cues). Shampoo Advertisement: In contrast, if you see an ad for shampoo, the attractive model with beautiful hair becomes very relevant because it directly relates to the product\'s promise (central cue). Competitive Situation: What it means: The competitive environment can make less important information (peripheral cues) become more important, even when consumers care a lot about the product (high involvement). Example: Similar Product Features: If two brands of smartphones have very similar features (central cues), a consumer who really cares about smartphones (high involvement) might choose the brand with the more appealing ad design or celebrity endorsement (peripheral cues). Summary: Cue Relevance: How much consumers care about certain pieces of information. Product Type: The importance of information changes depending on the product. Attractive models matter more for shampoo ads than for car ads. Competitive Situation: When product features are similar, even very interested consumers might choose based on the appeal of the ad itself rather than the product details. Cue Relevance: The degree of importance or significance that consumers attach to certain cues or information when making decisions. ▪ Product Type: What consumers find relevant can vary depending on the product being advertised. E.g., An attractive model (and her hair) may be decision irrelevant (peripheral cues) in an ad for a car, but decision relevant (central cues) in an ad for shampoo. ▪ Competitive Situation: The competitive situation can also work to enhance the role of peripheral cues even under high involvement. E.g., If competing brands are comparable in terms of their product features (central cues), highly involved consumers prefer the brand with the strongest peripheral cues in its advertising. d\. What are the marketing implications of central vs. peripheral routes of persuasion? Central Route Strategies: provide detailed info, highlight benefits&features, use credible sources, provide transparent info. Peripheral Route Strategies: use catchy visuals&slogans, leverage emotional appeals, keep messages simple&concise, use repetition. e\. What strategies are used by loyal consumers to resist persuasion from competitors (discrediting, discounting, and containment)? Discrediting: What it is: Saying bad things about your favorite brand aren\'t true. How it works: You argue against the negative claims with reasons why they\'re wrong. Example: Imagine you love a certain smartphone brand. If someone posts a bad review, you might say the reviewer didn\'t use the phone properly or has a bias against the brand. Discounting: What it is: Saying the bad things about your favorite brand don\'t really matter. How it works: You make the negative claims seem less important or relevant. Example: If you love a specific coffee brand and read a bad review about its taste, you might think, \"That person just has different tastes than me,\" and still believe the coffee is great. Containment: What it is: Ignoring the bad things about your favorite brand like they don\'t exist. How it works: You avoid or block out any negative information to keep your positive view intact. Example: If you\'re a big fan of a sports team, you might avoid reading articles that criticize your team and only read ones that praise them, so you can stay excited about your team. In summary: Discrediting: Argue that bad reviews are wrong. Discounting: Say the bad reviews don\'t matter. Containment: Ignore bad reviews altogether. **−Discrediting** (saying a brand attack isn\'t true): involves challenging negative information by presenting counterarguments. Consumers may seek weaknesses in competitor attacks to discredit the negative claims.E.g., A loyal customer of a particular smartphone brand might discredit negative reviews by pointing out flaws in the reviewers\' methodology or biases. **−Discounting** (saying a brand attack isn\'t important):occurs when consumers diminish the significance of negative information. They may protect their favored brand by reducing the importance they attribute to the criticized attribute. E.g., A coffee enthusiast may downplay negative reviews about the taste of their favorite coffee brand,attributing it to individual preferences rather than product quality. **−Containment** (sealing off the negative infomation like it doesn\'t exist): Consumers may mentally isolate or \"seal off\" negative information to quarantine it and prevent it from undermining their favorable perceptions. E.g., A fan of a popular sports team may avoid news articles criticizing their team\'s performance, choosing to focus only on positive coverage to maintain their enthusiasm. **4. Chapter 12. Self-Concept & Lifestyle** a\. What is self-concept? The self-concept refers to the collection of beliefs, perceptions, and ideas that individuals have about themselves. Divided into 4 parts: Private / Social self & Actual / Ideal Self-Concept. b\. What is the self-image congruence model, and how does it depend on product factors (e.g., value-expressive vs. utilitarian), situational factors (e.g., private vs. public or conspicuous consumption), and individual factors (e.g., high vs. low self-monitors)? The Self-Image Congruence Model is a marketing theory that explains how consumers\' self-concepts influence their brand preferences and purchase decisions. **▪ Value-Expressive vs. Utilitarian:** Self-image congruity is likely to matter more for products such as perfume where value-expressive symbolism is critical than for more utilitarian products such as a garage door opener. **▪ Private vs. Public/Conspicuous Consumption Situations:** Self-image congruity (especially ideal social self) is likely to matter more when the situation involves public or conspicuous consumption (e.g., having a beer with friends at a bar) than when consumption is private (e.g.,having a beer at home). **▪ High vs. Low Self-Monitors**: Self-image congruity is likely to matter more for consumers who place heavy weight on the opinions and feelings of others (called high self-monitors ) than for consumers who do not (called low self-monitors ), particularly in public situations where consumption behaviors can be observed by others. c\. What is the extended self, and what are its four distinct levels? It suggests that consumers often use external possessions as a way to define and express themselves. ▪ Individual Level: Personal possessions like jewelry, cars, or clothing serve as symbolic representations of identity and values, shaping self-perception and how others perceive us. ▪ Family Level: The family home, along with its furnishings and decor, is viewed as an extension of family members, reflecting their collective identity and providing a sense of belonging. ▪ Community Level: Environmental factors within the neighborhood, town, or city integrate into individuals\' self-concepts, influencing their sense of belonging and identity through culture, history, and landmarks. ▪ Group Level: Social groups, clubs, or sports teams contribute to individuals\' sense of identity and belonging, with landmarks and symbols reinforcing collective identity and shared values within the group. d\. What are psychographics? A close-up of a text Description automatically generated e\. What are two general lifestyle measurement systems (VALS & PRIZM), and what are their characteristics? −The VALS (Values and Lifestyle Survey) is a psychographic segmentation tool developed by SRI International. The VALS is based on enduring psychological characteristics that correlate with purchase patterns. ▪ Innovators, Thinkers, Believers, Achievers, Strivers, Experiencers, Makers, and Survivors. \- PRIZM is a state-of-the-art geo-demographic classification system. PRIZM, which stands for \"Potential Rating Index by Zip Market. A screenshot of a social media post Description automatically generated  **5. Chapter 14-18. Consumer Decision Process** a\. What is purchase involvement? (i.e., as purchase involvement increases, decision-making becomes increasingly complex: nominal → limited → extended decision-making.)\ Purchase Involvement (PI) is the level of concern for, or interest in, the purchase process, triggered by need to consider a particular purchase, and so, a temporary state influenced by the interaction of individual, product, and situational characteristics. A diagram of a process Description automatically generated b\. What is problem recognition? Problem recognition is the first stage in the consumer decision process. It involves the existence of a discrepancy between the consumer's desired state (what the consumer would like) and the actual state (what the consumer perceives as already existing. c\. What is the difference between internal and external search?  d\. What are evaluative criteria? −Evaluative criteria are those characteristics that are important to the consumer in the evaluation and choice of alternatives. e\. What is the difference among inert, inept, and evoked set? ▪ Inert set: alternatives that consumers are aware of and view in a neutral manner ▪ Inept set: alternatives that consumers are aware of and view negatively ▪ Evoked set: alternatives that consumers are aware of and view positivel f\. What is limited external search behavior? (i.e., external information search is skewed toward limited search, with the greatest proportion of consumers performing little external search immediately prior to purchase.) Limited external search behavior refers to consumers conducting minimal external information search after recognizing a need, especially just before a purchase. According to the textbook: High Search Costs: Searching for information requires time, energy, and money, which can deter extensive searching. Opportunity Costs: Consumers may prefer to spend their time on more desirable activities than searching for information. Cost-Benefit Analysis: Consumers will only search if the expected benefits (like lower prices or higher satisfaction) outweigh the expected costs. Often, they find the costs too high relative to the benefits. g\. What is the difference between the three types of choice processes (affective choice, attitudebased choice, and attribute-based choice)? ALSO EXAMPLES. −Affective choice is a decision-making process where individuals rely on their emotions and immediate emotional responses to make decisions.Instead of systematically analyzing the attributes or features of different options, affective choice focuses on how each option makes the individual feel. −Attitude-based choice is a decision-making process where individuals rely on their general attitudes, overall impressions, intuitions, or mental shortcuts to make a choice, rather than conducting a detailed comparison of specific attributes or features of the options. Factors such as low purchase involvement, limited information availability, and specific situational pressures like time constraints tend to boost the likelihood of attitude-based choice. −Attribute-based choice is a decision-making process where individuals carefully consider and compare specific attributes of the options available at the time of making a choice. Higher purchase involvement, easily accessible brand-attribute information, and situational factors such as lower time pressure increase the likelihood of attribute-based choice. h\. What are retailer brands? −Retailer brands are products that are developed, produced, and sold exclusively by a specific retailer under its own brand name or label. ▪ Exclusivity: Retailer brands are exclusive to the retailer that sells them, meaning they cannot be found at other retailers. ▪ Control: Retailers have control over the development, production, marketing, and pricing of their private label brands. ▪ Value Proposition: Retailer brands often emphasize value for money, offering consumers quality products at competitive prices. i\. What are spillover sales? − Spillover sales: occur when customers, who initially come to purchase an advertised item, end up buying additional products during their visit. ▪ For every \$1 spent on the sale item by people who came to the store in response to the advertising, another \$1 was spent on some other item(s) in the store. j\. What is the retail attraction/gravitation model? −Retail attraction model (= retail gravitation model): A theoretical framework used to analyze consumer behavior and predict patterns of store attraction, focusing on store size and distance from the consumer. ▪ Store size is quantified in terms of square footage, which is assumed to represent the breadth and variety of merchandise offered by the store. ▪ Distance, or travel time, to a store serves as a proxy for the effort required by consumers to reach a particular retail area. k\. What is post-purchase dissonance, and what are the four characteristics likely to contribute to it? **Postpurchase Dissonance**: A phenomenon that occurs when a consumer feels discomfort or uneasiness after making a purchase. −Characteristics which are likely to contribute to postpurchase dissonance: **▪ The degree of commitment or irrevocability of the decision:** The easier it is to alter the decision, the less likely one would experience dissonance. ▪ **The importance of the decision to the consumer:** The more important the decision is to the consumer, the more likely dissonance will occur. ▪ **The difficulty of choosing among the alternatives:** The harder it is to select from among the alternatives, the more likely one will experience postpurchase dissonance. **▪ The individual's tendency to experience anxiety:** It is most likely to occur among individuals with a tendency to experience anxiety. l\. What are the cognitive strategies utilized by consumers to reduce dissonance? **−Increase the desirability of the brand purchased:** Consumers may focus on the positive aspects of the chosen brand or product to reaffirm their decision. **−Decrease the desirability of rejected alternatives:** To justify their decision, consumers may mentally devalue or criticize the alternatives they considered but did not choose. **−Decrease the importance of the purchase decision:** Consumers may downplay the significance of the purchase decision to reduce its perceived impact on their overall well- being. **−Reverse the purchase decision (return before use):** In some cases, consumers may decide to reverse their purchase decision altogether by returning the item to the retailer before using it. This allows them to eliminate the source of dissonance entirely and restore their sense of satisfaction m\. What is churn rate and its marketing implications? Churn refers to the rate at which customers discontinue or cease their relationship with a company or service over a specific period. − This could include canceling subscriptions, switching to a competitor, or simply no longer engaging with the company. It typically costs more to obtain a new customer than to retain an existing one, and new customers generally are not as profitable as longer-term customers.