Consumer Behavior Notes PDF

**Consumer behavior** **Topic 1:** What Is Marketing? **Marketing is** a process by which companies create value for customers and build strong customer relationships to capture value from customers in return. **Customer needs, wants, and demands:** **Marketers' major decisions** ![](media/ima...

**Consumer behavior** **Topic 1:** What Is Marketing? **Marketing is** a process by which companies create value for customers and build strong customer relationships to capture value from customers in return. **Customer needs, wants, and demands:** **Marketers' major decisions**  **1.** **Segmentation**: This is the process of [dividing a market into distinct groups] of buyers with [different needs or behaviors]. There are several ways to segment: \- Demographics: Age, gender, income, etc. \- Behavioral: Consumer behavior patterns. \- Psychographic: Lifestyle, values, and personality traits. **2. Targeting**: After segmentation, [marketers choose which segments to target] and aim to serve those with [tailored products or services.] **3.** **Positioning**: Marketers then [position] their product or service in a way that [appeals to the target segment]. This involves defining how the product is perceived in the market. **4.** **Constructing the Marketing Pillars (4Ps):** \- [Product]: What the company offers. \- [Place]: Where and how the product is distributed. \- [Pricing]: Setting a price that aligns with the target market and positioning. \- [Promotion]: Communicating the product to the market (e.g., advertising, sales promotions). **What is Consumer Behavior?** Consumer behavior: the study of the **processes** involved when individuals or groups select, purchase, use, or dispose of products, services, ideas, or experiences to satisfy needs and desires. Consumer behaviour is the study of ***how people buy***, ***what they buy***, ***when they buy***, and ***why they buy***. It studies characteristics of individual consumers such as demographics, psychographics and behavioural variables in an attempt to understand people's needs and wants. Consumer behavior is an **ongoing process**, not merely what happens at the moment a consumer hands over money or credit card and in turn receives some good or service. **Actors in Consumer Behavior** **Consumer**:is a person who identifies a need or desire, makes a purchase, disposes of the product, and then consumes/uses the product's benefits. **Consumer vs. customer** **Customer** The actual or prospective [purchaser] of products or services **Consumer** The [ultimate user] or consumer of goods, ideas, and services **Big Data** **Database marketing** tracks specific consumers' [buying habits] very closely and crafts [products and messages tailored precisely to people's wants and needs] based on this information. The collection and analysis of [extremely large datasets] is called Big Data. **Culture of participation** Users upload 72 hours of video to YouTube every minute. In just 30 days on YouTube, more video is broadcast than in the past 60 years on the CBS, NBC, and ABC broadcasting net- works combined. It took radio 38 years to reach 50 million listeners. TV took 13 years to reach 50 mil- lion users. The Internet took 4 years to reach 50 million people. In less than 9 months, Facebook added 100 million use. People share more than 1.5 billion pieces of content on Facebook---every day. Every minutes, Snapchat users share 527,760 photos, 456,000 tweets are sent on Twitter, Instagram users post 46,740 photos. A fundamental premise of consumer behavior is that [people often buy products not for what they do, but for what they mean. ] **Self-concept attachment**: the product helps to [establish the user's identity ] **Nostalgic attachment**: the product serves as a [link with a past self ] **Interdependence**: the product is a part of the [user's daily routine] **Love**: the product [elicits emotional bonds] of warmth, passion or other strong emotions **Studying Consumer Behavior is a good business!** Marketing managers :\ -- Identify [customer's needs and wants]: business opportunities; new products development, new attributes to existing products -- Establish [appropriate marketing] programmes for the targeted segment. --  Positioning [decisions] --  [Knowledge and data about customers]: relationship marketing and customization. Social and not-for-profit organizations (i.e., charities; schools; community centers, etc.): -- These organizations have different customers to please (Donors, users, volunteers, general public, government) Public policy makers:\ -- Public service initiatives have to be [based on an understanding of consumer behaviour]. -- Most government initiatives (e.g., antismoking campaigns; creation of a healthy society) need a knowledge of consumer behaviour to succeed. Folks from all walks:\ -- Understanding consumer behaviour may [help one understands his or her own behaviour. ] **Disciplines in Consumer Research**  The image depicts a triangular model of **consumer behavior** that demonstrates the relationship between **micro consumer behavior** (focused on individuals) and **macro consumer behavior** (focused on society). It shows how various disciplines contribute to the study of consumer behavior at different levels. 1. **Micro Consumer Behavior (Individual Focus)**: This is at the top of the triangle, indicating a focus on understanding individual consumers\' psychological and behavioral processes. Disciplines such as **Experimental Psychology, Clinical Psychology, Developmental Psychology, Human Ecology**, and **Microeconomics** are [concerned with how individuals think, make decisions, and interact with products or services on a personal level.] 2. **Macro Consumer Behavior (Social Focus)**: The base of the triangle represents a broader social perspective on consumer behavior, studying groups, cultures, and societal influences. Disciplines such as **Sociology, Macroeconomics, Semiotics, Demography, History,** and **Cultural Anthropology** [study consumer behavior in terms of societal trends, group interactions, and cultural or historical influences on consumption.] 3. **The Flow between Micro and Macro**: The arrows indicate a dynamic flow between individual behavior (micro) and social factors (macro), [suggesting that both individual choices and societal factors influence consumer behavior.] The disciplines mentioned within the triangle contribute to a comprehensive understanding of how both personal and societal factors shape consumer decisions. In essence, consumer behavior is studied from both an individual (psychological and economic) perspective and a social (cultural, historical, and demographic) perspective, with insights from multiple fields shaping the overall understanding. **What factors affects consumer behavior?** Consumer behavior is influenced by **internal** (personal and psychological) and **external** (social and environmental) factors: **Internal Factors:** 1. **Motivation**: Drives consumers to fulfill needs, from basic to self-actualization. 2. **Perception**: How individuals interpret product information. 3. **Learning**: Past experiences shape future purchases. 4. **Attitudes/Beliefs**: Positive or negative feelings towards products. 5. **Personality**: Traits and self-concept influence product choices. 6. **Age/Lifestyle**: Preferences change with life stages. **External Factors:** 1. **Culture**: Values and customs guide buying habits. 2. **Social Class**: Economic status affects purchasing power. 3. **Reference Groups**: Family, friends, and colleagues influence choices. 4. **Economic Environment**: Income and economic conditions shape spending behavior. **Topic 2:** **Consumers as Problem Solvers** Every [consumer decision] we make is a [response to problem.] - Sometimes the decision-making process is almost [automatic]: we make our choice based on very little information. - At other times, the decision process resembles a [full time job ] **For Reflection** Is it a problem that consumers have too many choices? Would it be better to have less choices? How does it affect consumer decision-making? **32% bought a jar of jam under "limited choice" condition (6 flavors) vs. only 3% bought a jar of jam under " extensive choice" ( 24 flavors)** **Three Types of Decision-Making** Individual (consumer) possess a repertoire of strategies that help him to make decision. The image illustrates three types of consumer decision-making styles: **Cognitive**, **Habitual**, and **Affective**. Each reflects a different approach consumers take when making purchasing decisions. 1. **Cognitive Decisions**: **Deliberate, Rational, Sequential**: Cognitive decision-making involves a thoughtful, rational, and step-by-step process. Consumers consciously gather information, compare options, and analyze the pros and cons before making a decision. This type of decision-making is more likely to be used for expensive or complex purchases, like buying a car or choosing a home. 2. **Habitual Decisions**: **Behavioral, Unconscious, Automatic**: Habitual decision-making is routine-based. Consumers often make choices without much thought, relying on habits or past experiences. This applies to low-involvement products, such as buying the same brand of toothpaste regularly. The decision happens almost unconsciously because it\'s become a repeated behavior over time. 3. **Affective Decisions**: **Emotional, Instantaneous**: Affective decision-making is driven by emotions and feelings rather than logic. Consumers may make impulse purchases based on how a product makes them feel, such as buying a luxury item because it feels rewarding. These decisions are typically quick and less structured, often based on mood or emotional responses. Each decision-making style is influenced by the nature of the product, the level of involvement, and the consumer\'s personal preferences or habits. **Same choice situation but different perspectives** My husband: I want the car I read about in the latest issue of Car and Drive magazine. It has a six-cylinder turbo engine, a double-clutch transmission, a 90 stroke bore, and 10:1 compression ration. Me: I want a red one. **Involvement** Involvement is a person's [perceived relevance of the object] based on their inherent needs, values, and interests. The term object is used in the [generic sense to refer to a product, brand, ad, purchase situation or behavior. ] Involvement reflects our [level of motivation to process information] about a product or service we believe [will help us to solve a problem, or reach our goal].  **Types of Involvement** - Product involvement - Message involvement - Situational involvment **Product involvement** **Product involvement** is a consumer's [level of interest] in a particular product. As a rule, product decisions are likely to be highly involving if the consumer believes there is perceived risk. **Five Types of Perceived Risk:** 1. **Monetary Risk**: Concerns over [financial loss or overspending], especially with expensive items. 2. **Functional Risk**: Worries that the product [may not perform as expected.] 3. **Physical Risk**: [Fear of harm or health risks] from using a product. 4. **Social Risk**: Anxiety about [social judgment or damaging one\'s image] due to the purchase. 5. **Psychological Risk**: [Internal guilt or regret if the purchase conflicts with personal values or self-image.] These risks influence how consumers evaluate purchases. A chart of risk factors Description automatically generated with medium confidence **Message Involvement** Message involvement reflect the [level of attention] that consumer gives to a specific "message". **High-involved** consumers [process more information] comparing to **low-involved** ones. -- Print is a high-involvement medium. -- TV is a low-involvement medium. **How to boost person's motivation to process information?** - Use [**novel** stimuli], such as unusual cinematography, sudden silences, or unexpected movements, in a commercials. - Use [**prominent** stimuli], such as loud music and fast action, to capture attention. - Include [celebrity] endorsers. - [Provide value] that consumers appreciate. - Invent [new media] platforms to grab attention. - [Alternate reality] games (ARG) - Create a spectacles where [message is itself a form of entertainment.] Reebok installed a combination speed cam and a shoe display in the center of town. Then they told people that whoever ran past the display the fastest would get a free pair of shoes. **e.g.** Augmented Reality Taco Bell's in partnership with Snapchat create AR lenses and enabled users to turn their head into a taco. It broke a Snapchat record by amassing 224 million views in just one day. **Situational Involvement** Situational involvement take place with a [store, Website, or a location] where people [consume] a product or service. **Cognitive decision making** According to this perspective: People [carefully integrate] as much information as possible with what [they already know about a product], weigh the pluses and minuses of each alternative, and arrive at a satisfactory decision. Especially relevant to activities like financial planning or decision that impact a consumers quality of life. Individuals tend to be "*cognitive misers*" : we collect just as much data as we need to make an informed decision. **Steps in the cognitive Decision-Making Process** **Step 1: Problem Recognition** Occurs when consumer sees difference between current state and ideal state: **Problem Recognition: Shifts in actual or ideal states**  **Step 2: Information Search** The process by which we survey the environment for appropriate data to make a reasonable decision. -- [*Prepurchase* or *ongoing search*] *(hard-core shoppers).* -- *[Internal]* (memory) or *[external] search (Ad, friends, web, cybermediary..).* **How much do we search** We search [more when the product is important]. All things equal: -- [Younger], better educated people who enjoy the shopping / fact finding process tend to conduct more information searches. -- [Women] are more inclined to search than man. -- [Individual] who place [greater value on style and the image] they process. **Step 3: Evaluate Alternatives** **How we put products into categories ?** We cognitively represent information we have about products in knowledge structures Knowledge structure: refers to a [set of beliefs] and the [way we organize these believes in our minds. ] These structures matter to marketers because [they need to ensure that customer correctly group their product. ] We typically [represent a product] in a **cognitive structure at one of three levels:**  **Superordinate Level**: The broadest category, representing general product categories (e.g., \"beverages\"). **Basic Level**: A more specific category within the broader one (e.g., \"soft drinks\"). **Subordinate Level**: The most specific, identifying particular brands or models (e.g., \"Coca-Cola\"). E.g Levels of Abstraction in Dessert Categories **Strategic implication of product categorization** 1. **Product position:** the [success of positioning] strategy hinges on the marketer's ability to [convince the consumer to consider its product] within a given category. -- E.g., *Orange juice it's not just for breakfast anymore* -- *Pepsi A.M. coffee substitute* 2. **Identify competitors** 3. **Create an exemplars** 4. ***Locate products in a store*** **Evaluative criteria** are the [dimensions we use to judge] the merits of [competing options] (e.g. functional attributes, experiential). **Determinant attributes** are the features we [actually use to differentiate among choices]. Marketers need to educate consumer about which criteria they should use as determinant attributes. **Consumer decision rules** are [procedures used by consumers to facilitate] brands and other consumption related choices. - This rules [reduce the burden of making a complex decisions] by providing guideline that make the process less taxing. - **Two types** of consumer decision rules: **Noncompensatory Consumer Decision Rules** Lexicographic rule: --  Product attributes are [identified] --  Product attributes are [ranked] in terms of [importance ] --  [brands are compared] in terms of the attribute considered most important --  Brand that scores [highest on the first attribute is chosen] --  If there is a [tie, the scores on the next attribute are considered] Elimination-by-aspects rule: the buyer also evaluates brands on the [most important attribute and imposes a specific cutoff. ] Conjunctive rule (brand): --  Product attributes are [identified] --  a [minimally acceptable cutoff point is established] for each attribute --  [brands that fall below the cutoff] point on any one attribute are [eliminated from further consideration. ]  **Step 4: Product choice** In this step the consumer [choose one product among the product he evaluate.] **Step 5: Postpurchase Evaluation** Postpurchase Evaluation closes the loop; it occurs when we [experience the product or service we selected and decide whether it meets] (or may be even exceeds) our [expectations]. **Heuristics: mental shortcuts or "mental rules-of-thumb"** **Habitual decision making** Habitual decision making describes the [choices we make with little or no conscious effort.] There is a lot of factors that bias our decisions: **Priming**: cues in the [environment that make us more likely to react] in a certain way even tough we are [unaware of these influences. ] **Default bias**: we are [more likely to comply with a requirement than to make an effort not to comply. ] -- Opt in vs opt out We [often take the easy way out] (less mental effort) when we make decisions. **Satisfying solution:** The ["good enough"] (**bounded rationality**) **Framing (mental acconting)**: the way we [pose a problem and whether it's phrased in terms of gains and losses] influences our decisions. e.g: Free ticket vs. paid small fortune for the ticket. **-Sunk-cost fallacy**: We are [reluctant to waste something we have paid for ] **-Loss aversion**: We [emphasize losses] more than gains [ ] **-Prospect theory**: [risk differs] when we [face gains versus losses] A row of colorful rectangular labels Description automatically generated with medium confidence **AFFECTIVE DECISION MAKING** **Emotion and consumption** With affective decision making, [consumers make a decision because the choice feels right] [rather than because they have made a detailed, systematic evaluation] of the alternatives Affect is the [emotional response to products.] **Appraisal theory**: emotions are elicited and differentiated on the basis of a person\'s [subjective evaluation of the personal significance] of a situation, object, or event. -- Our interpretation of a situation [causes a emotional response] that is based on that interpretations. **Positive and negative affect** A passionate commitment to a brand is called a lovemark. **Positive** emotions: pride, joy, happiness **Negative** emotions like disgust, guilt, embarrassment [work to influence consumers to avoid some things. ] **How Social Media Tap into Our Emotions** - Happiness economy - Sentiment analysis - Word-phrase dictionary **Topic 3:** **Perception** The process by which individuals select, organize, and interpret stimuli into a meaningful and coherent picture of the world. It can be described as "how we see the world around us."  Individuals [act and react on the basis of their perceptions], not on the basis of objective reality. Consumers' perceptions are more important to a marketer than their knowledge of objective reality because [people make decisions based on their perceptions. ] **Sensation** Sensation refers to the [immediate response of our sensory receptors] (eyes, ears, nose, mouth and skin) to basic stimuli (sensory input) such as [light, color, sound, odor and texture.] Human sensory sensitivity refers to the [experience of sensation]; Sensitivity to stimuli varies with the quality of our sensory receptors Sensation itself [depends on energy change]. One honking horn more or less would never be noticed on a street with a heavy traffic. **Sensory Marketing** **Sensory marketing** is the process of [systematically managing consumers' perception and experience] of marketing stimuli. **Sensory Marketing Vision** **Vision**: product's [color, size, and styling, packaging]. **Reactions to [color] come from [biological & cultural difference:]** Western countries: black is the color of mourning; in Japan white plays this role Women tend to be drawn to brighter colors and more sensitive to subtle shadings and patterns Older person prefer white and bright tones (with age our vision takes on a yellow cast) **Colors influence our emotions directly:** Red: create [feelings of arousal] and [simulate appetite] Blue: is more [relaxing], carry a sense of [peace and limitless]; most preferred color around the world. **Trade dress:** is when some [color combinations come to be so strongly associated with a corporation] **Marketing Applications of Colors** **Ketchup question: Red, green or purple?** In 2000 Heinz decide to introduce "Blastin' Green" in a squeeze bottle as a promotional ketchup in support of the first Shrek movie. Two years after, Heinz introduced "Funky purple" ketchup, and other color (orange, blue, pink). What sensory perception is Heinz trying to appeal to? Do you think this product will be successful ? Why or Why not? **Sensory Marketing Smell** **Smell:** Odor can also [stir emotions and memory.] Are we smelling the same smell! With nearly a million variations on 400 smell receptors, everyone senses smell differently Any two people will have approximately 30% of receptors that are entirely different from someone else (Hiroaki Matsunami, Duke University ) Dunkin' Donuts campaign in South Korea Dunkin was associated with the junk food pastries, not hot liquid caffeine in South Korea When a company jingle played on municipal buses, an atomizer released a coffee aroma. The campaign increased visits to Dunkin' Donuts outlets near bus stops by 16% and sales at those outlets by 29%. **Sensory Marketing Hearing** [Audio watermarking: a catchy song or tune] that runs [continually through a person\'s mind]. Sound symbolism (field of linguistics): the process by which the way a word sounds influences our assumption about what it describes and attributes. Clorox, Chanel Hard consonant : **Kelloges** , **Pepsi** **Sensory Marketing Touch or haptic sense** Touch matters: Participants who simply [touched an item for 30 seconds or less created a greater level of attachment to the product.] The touch of toilet tissue increased sales by 50%. we are more sure about what we perceive if we can touch it. Example of Applications of Touch Perceptions Kansai engineering: A philosophy that [translates customers' feelings into design] [elements.] Mazda Miata designers discovered that making the stick shift (shown on the right) exactly 9.5 cm long conveys the optimal feeling of sportiness and control. **Sensory Marketing Taste** ** Taste** receptors [determine our experience of many products]. There are approximately 10,000 taste buds on the tongue but there are also taste buds in the throat. Each taste bud consists of between 50 and 100 individual [cells sending sensory information to the brain on the chemical composition and qualities of what we eat and drink.] [Women have more taste buds] and are more sensitive compared to men when it comes to evaluating dishes and drinks. It could mean that [women in some ways seem to have better taste] because of having more taste buds in the mouth and in the throat. [Culture affect the tastes] we find desirable. The [sound and the sight and touch interfere with the taste] **The perceptual process** **Perception** is the process by which [sensations are selected, organized, and interpreted].  [Each person interprets] the meaning of a stimulus in a manner consistent with [his /her own unique bias, needs and experiences.] **Stage 1: Key Concepts in Exposure** **Exposure** Exposure occurs when a stimulus comes within the range of someone's sensory receptors. ** The science of psychophysics** focuses on how the [physical environment is integrated into our personal, subjective world.] ** Sensory threshold:** is the **weakest** **or** **highest** **level** **of** **stimulus** that a person can detect. [What person are capable of perceiving.] ** The Absolute Threshold:** The **lowest level** at which an individual can experience a sensation. The absolute threshold means that the [stimulation used by marketers must be sufficient to register.] For example, the distance at which a driver can note a specific billboard on a highway is that individual's absolute threshold. The sound emitted by a dog whistle is too high to be detected by human ears, so this stimulus is beyond our auditory absolute threshold. ** The Differential threshold** refers to the **ability** of a sensory system to **detect** **changes** in a stimulus or differences [between two stimuli.] The **minimum** **change** in a stimulus or the minimal difference that **can** **be** **detected** between two similar stimuli is called the [***just*** ***noticeable*** ***difference* (J.N.D).**] **Marketing Applications of the JND** Manufacturers and marketers endeavor to determine the relevant JND for their products so that: **Negative changes**---increases in price, decreases in quantity or quality---**are** **not** **readily** **discernible** **to** **the** **public.** PepsiCo reduced the weight of one snack food bag from 14.5 ounces to 13.5 ounces (and maintained the price at \$3.29). Marketers want to [meet or exceed the consumers' differential threshold so that they readily perceive] the **improvements** made in the original product. "According to AdAge, Tropicana's unit sales decreased by 20% in less than two months of their new package being displayed on shelves. After two months of sales decline, Tropicana announced that they were dumping the new redesign and switching back to the old design" (Kinde, 2013). **Weber's Law** Ernst Weber (psychophysicist) found that the [amount of change required for the perceiver to notice a change] systematically [relates to the intensity of the original stimulus.] ** Weber's Law:** The stronger the initial stimulus, the greater a change must be for us to notice it. **Application of Weber's law in marketing** A rule of thumb used by some retailers is that a [markdown should be at least 20% to make an impact on shoppers.] If so, a pair of socks that retails for \$10 should be put on sale for \$8 (a \$2 discount). However, a sports coat selling for \$100 would not be benefit from a mere \$2 discount; it would have to be marked down to \$80 to achieve the same impact. **Subliminal perception** **Subliminal perception** refers to a stimulus [below the threshold of recognition or the level of consumer's awareness.] It is believed that many [ads are designed to be perceived unconsciously] (below threshold of recognition) People can [perceive stimuli without being consciously aware] that they are doing so. **Is Subliminal persuasion effective?** Most researchers believe that subliminal techniques [are not of much use in marketing]. Most examples of subliminal perception that have been discovered are not subliminal at all; they are quite visible. [If you can see it or hear it, it is not subliminal.] Extensive research has shown [no evidence that subliminal advertising can cause behavior changes.] **Stage 2: Attention** ** Attention** is the extent to which [processing activity is devoted] to a particular stimulus Consumers experience [sensory overload] 3500 pieces of ad every day vs.560 of ad 30 years ago Marketers need to [break through the clutter] **Media snacker:** consumers in their 20s [switch media venues] about 27 times per nonworking hour **Eyeball economy:** [fight for getting consumer attention] **Perceptual Selection** Because the brain's capacity to processes [information is limited, consumer are very selective about what they pay attention to.] **Perceptual selection** means that people [attend to only a small portion] of the stimuli to [which they are exposed.] *Psychic economy* **How do we choose?** Personal Selection factors **Experience** is the [result] of [acquiring and processing stimulation over time.] It helps to [determine how much exposure to a particular stimulus a person accepts] Perceptual filters based on our [past experiences influence what we decide to process.] **Perceptual vigilance:** means consumers are more likely to be aware of stimuli that relate to their [current needs.] **Perceptual defense:** means that people [see what they want to see---and don't see what they don't want to see.] **Adaptation** is the degree to which consumers [continue to notice a stimulus over time] **Factors leading to adaptation** **Stimulus selection factors** In general, we are [more likely to notice stimuli that differ from others] around them. A message create **contrast** in several ways: Size Color Position Novelty Shocking or unrealistic images Rich media content; teaser ads **Stage 3: Interpretation** **Interpretation** refers to the [meanings we assign to a sensory stimuli]. We interpret the stimuli to which we do [pay attention according to learned patterns or **schema** and expectations.] **Stimulus organization** **Gestalt psychology** : *people [interpret meaning from the totality of a set] of stimuli [rather] than from any [individual] stimulus.* **Gestalt** : the [whole is greater than the sum of its parts] **Gestalt principles** Closure: people perceive an [incomplete picture as complete] Similarity (grouping): consumers [group together objects that share similar] physical characteristics Figure-ground: [one part of the stimulus will dominate] (the figure) while the other parts recede into then background (ground) **Perpetual positioning** When a marketer understands how [consumers think about a set of competing brands, he can use these insights to develop a positioning strategy.] A product stimulus often is [interpreted in light of what we already know] about a product category and the characteristics of existing brands. **Perceptions of a brand consist of:** Functional attributes (e.g., its features, its price, and so on). Symbolic attributes (its image, and what we think it says about us) **Perception and marketing strategy** **Make perceptual selection work [in your favor]** Increase [exposure] to marketing stimuli by [placing ads in places where consumers are likely to be held captive.] Use the [JND principle or the Weber's law to draw attention] to the products by making sure that the [changes to the product are noticed.] [Draw attention] to your ad using contrast and other principles Find [creative ways to reduce blocking] ** Ensure that consumers organize and interpret [messages correctly]** ** Develop [suitable consumer imagery] (brand, package, service, price)** **Topic 4:** **Motivation**\ Motivation is the [driving force (inner reasons)] that impels people [to act.]\ -- Actual state: the condition in which the person [happens to be] at the given time\ -- Desired state: the condition the individual [would like to be]\ \ **Motivation** **process** A diagram of a drive theory Description automatically generated **Needs**\ We may categorize needs as:\ -- Physiological needs are innate (biogenic, primary) and fulfilling them [sustains biological existence] ([maintain life]). i.e.: shelter, food, air\ -- Psychological needs (psychogenic) are needs that [we learn in response] to our culture or social environment. i.e.: the need for self-esteem, prestige, affection, power, learning, and achievement, autonomy, uniqueness\ -- Utilitarian need: focus on the [objective,tangible attribute of the product] (practicality) / functional benefit. E.g: A drink: number of calories, vitamins/ Pair of jeans: durability, price.\ -- Hedonic need: oriented to the ["experience"], the pleasurable aspect of consumption,\ subjective; Involve [emotional response] (pleasure). E.g.: Pleasure we feel when we eat a good pizza regardless number of calories; the appearance of clothing rather their ability to keep out the cold **Can a product satisfy only one need?** A same product may [satisfy different needs]\ The purchase of a house satisfies:\ The need for [shelter] (**physiological**)\ But the [type of the house] (design) and its [location] are likely to reflect **psychological needs:**\ -- One may seek a place where large groups of people [can be entertained] (**social** needs).\ -- One wants to live in an exclusive community to [impress friends] (**ego** needs, achievement)\ -- A pair of blue jeans may be bought because for the [luxurious image] (**self-esteem** need) it portrays and because it [covers us] (**safety** need). **Need arousal** Most of an individual's need are dormant much of the time. Needs can be [internally or externally activated: ] -- **Biological arousal** ([involuntary]) E.g.: Stomach rumbling: need for food; decrease in body temperature: need for warm clothes -- **Emotional arousal** E.g.: A young man who dreams of being a famous author may enroll in a writing workshop -- **Cognitive arousal** [Random thoughts] can lead to cognitive awareness of a need to. E.g.: A commercial ad of cell phones may [trigger] an instant desire to call your family. -- **Environmental arousal** Cues in the environment (e.g. smell of food); coupon **Goals** **Goal** is a particular [outcome that a person would like to achieve]; it is a concert objective with [specific plan of action]. **e.g.** lose weight before the summer; save money to buy new car, study every day for an upcoming exam **1. Generic goals :** the [general categories] of goals that consumers see as a way to [fulfill their needs]. e.g., "I want to get a graduate degree" **2. Product-specific goal:** the [specifically branded products or services] that consumers select as their goals. e.g., "I want to get an MBA in Marketing from University of Sharjah " **Marketers are interested in getting consumers to move from [generic goals to product- specific goals]**[. ] e.g. Heinz spends a considerable amount on advertising [to make consumers ask for Heinz by name and not just for ketchup. ] **Selecting Goals** The goals that individuals select depend on :personal experiences and knowledge, physical capacity, cultural norms and values, the goal's accessibility (The goal object has to be both [socially acceptable and physically accessible].) **Needs and Goals** **Needs and goals are [interdependent]** neither exists without the other. However, people are [often not as aware of their needs as they are of their goals]. (e.g., joining chats groups online without beaning aware of our social need) **Needs are [never fully or permanently satisfied]** As individuals [attain their goals, they develop new ones]. If they [do not attain] their goals, they continue to [strive for old goals or they develop substitute goals. ] **New needs emerge as old ones are satisfied (hierarchy)** **Success and failure influence goals** --  [Failure lower goals] (**substitute goals**) E.g a man who cannot afford a BMW may convince himself that a new, sporty and less expensive Japanese car has an image he prefers. **Frustration and defense mechanisms** **Frustration** is the [feeling that results from failure] to achieve a goal. **Defense** **mechanisms** are cognitive and behavioral ways to [handle frustration] (especially for one that cannot cope with the failure) - daydream, withdrawal, projection, regression, etc. **Defense Mechanisms** **Aggression** Occurs when individuals respond to frustration with [aggressive behavior to protect self-esteem.] **Rationalization** Involves [inventing plausible reasons for not achieving goals.] **Regression** Individuals react to frustration with [childish or immature behavior.] **Withdrawal** [Frustration is resolved by leaving] the frustrating situation. **Projection** [Blaming external objects or other people] for one\'s own failures. **Daydreaming** [Engaging in fantasies] to attain imaginary satisfaction [for unmet needs.] **Identification** Resolving frustration by [subconsciously associating with someone else\'s success.] **Repression** [Avoiding the tension] from frustration by [suppressing the unsatisfied need]. **Need can conflict (motivational conflicts):** **Approach-Avoidance Conflict** The individual is [torn between wanting to engage in a behavior and wanting to avoid] it simultaneously. Example: The desire to eat organic food but wanting to save money. **Approach-Approach Conflict** Involves choosing between two [desirable] options. Example: Choosing between attending a career-night function or going out with friends. **Avoidance-Avoidance Conflict** Involves choosing between two [undesirable] options. Example: Deciding whether to jump off a plane or off a bridge when neither option is appealing. **THEORIES OF MOTIVATION** **Maslow\'s Hierarchy of Needs**, a motivational theory in psychology comprising a five-tier [model of human needs], often shown as hierarchical levels within a pyramid. Here's a breakdown of each level: **Maslow\'s Hierarchy of Needs (Bottom to Top)** 1. **Physiological Needs (Basic survival)** Includes: Food, water, air, shelter, and sleep. 2. **Safety and Security Needs (The need to be secure and protected)** Includes: Protection, order, stability, and security. 3. **Social Needs (The need to feel like a member of a family or community)** Includes: Affection, friendship, love, and belongingness. 4. **Ego Needs (The need to be recognized as a person of worth)** Includes: Prestige, status, self-esteem, and a sense of accomplishment. 5. **Self-Actualization (Become everything that you are capable of becoming)** Involves personal growth, creativity, and self-improvement. - [Lower-level needs generally must be satisfied before *higher-level*] needs become activated - Psychological needs are dominant when they are chronically unsatisfied Maslow's hierarchy offers a [useful, comprehensive framework for marketers] trying to develop [appropriate advertising appeals] for their products. The hierarchy enables marketers to [focus their advertising appeals on a need level] that is likely to be shared by a large segment of the prospective audience. The hierarchy [facilitates product positioning.] **Specific Needs and Buying Behavior** **McClelland\'s Trio of Needs:** Power, affiliation & achievement These categories suggest that different marketing strategies can be used to target individuals [based on their primary motivations and desires.] 1. **Need for Achievement** Individuals [value personal accomplishment]. Prefer situations where they can take responsibility for finding solutions. Tend to favor products that symbolize success, such as luxury brands or technology products. 2. **Need for Affiliation** Behavior is heavily influenced by the [desire for friendship, acceptance, and belonging.] Prefer products that can be used in group settings or are approved by friends. 3. **Need for Power** Motivated by a desire to [control their environment and others.] Prefer products that help them gain mastery over their surroundings. 4. **Need for Uniqueness** Aim to [assert their individual identity.] Enjoy products that emphasize their unique characteristics, like perfumes or clothing. **Implications of motivation theories to marketers** 1\. Marketers need to [determine the needs and goals] of the target market. 2\. Knowledge of consumer needs can be used to [segment the market.] 3\. Promotional strategies have to be tailored towards [highlighting how a product can satisfy consumer needs. ] 4\. Marketers need to [enhance consumer's motivation] to process communication **Affect** Affect [describes the experience of emotionally laden states]. The nature of these experience ranges from: -- **Evaluations**: are valenced (i.e., positive or negative) [reactions] to events and objects that are [not accompanied by high levels of physiological arousal] -- **Moods**: involve [temporary positive or negative affective states] accompanied by moderate levels of arousal. Moods tends to be diffuse and not necessarily linked to a particular event -- **Emotions**: tend to be [more intense] and often [relate to a specific triggering] event [Positive] emotions: Joy, happiness, etc.\ [Negative] emotions: disgust, anger, guilt, etc. **Mood Congruency** :refers to the idea that our [judgments tend to be shaped by our moods. ] **How Social Media Tap into Our Emotions** [Happiness] economy [Sentiment] analysis [Word-phrase] dictionary **Topic 5:** **Learning** Learning is a **relatively** **permanent** change in behavior caused by experience. The experience can be **direct** or it can be **observed**. **Intentional** learning acquired as a result of a [careful search for information ] **Incidental** learning when we learn even [when we don't try] Learning is an *ongoing process*:\ -- Our [knowledge] about the world [constantly] [updates] as we are [exposed to new stimuli.] -- And as [we receive ongoing feedback] that allows us to [modify our behavior] when we find ourselves in similar situations [at a later time. ] **Importance of Learning** Marketers must [teach consumers:] -- [where] to buy\ -- [how to] [use]\ -- how to [maintain] -- how to [dispose] of products --to [differentiate] their products from competitive offerings **Theories of Learning** There are several theories to explain the learning process: --**Behavioral learning theories** focus on [stimulus-response] connections. --**Cognitive theories** regard [consumers as complex-problem solvers] who [learn abstract rules and concepts] when they [observe what others say and do. ] **Behavioral learning theories** Behavioral learning theories assume that [learning takes place as the result of responses] to external events  **Types of Behavioral Learning Theories** **1. Classical conditioning**: a stimulus that elicits a [response is paired with another stimulus] that initially does not elicit a response on its own. [involuntary] behaviors. **2. Instrumental conditioning** (Operant conditioning): the individual [learns to perform behaviors] that produce positive outcomes and [to avoid those that yield negative] outcomes. -- [voluntary] behaviors. **Classical Conditioning** **Components of Conditioning** -- **Unconditioned stimulus** : it is a stimulus (food) [naturally capable] of causing the response (salivation) -- **Conditioned stimulus**: it is a stimulus that [did not initially cause the response] (bell), but [over time will be associate] with the response. -- **Conditioned response** (dog drooling) the [response] **Marketing applications of Classical Conditioning** - repetition - stimulus generalization - stimulus discrimination **Repetition** **Repetiotion** works by [increasing the strength of the association] and by [slowing the process of forgetting. ] After a certain number of repetitions retention declines: **Advertising wear-out**. [Wear-out may be avoided] by varying the message through cosmetic variation or substantive variation. **Extinction** occurs [when the effects of a prior conditioning diminish] and finally disappear. **Stimulus generalization** Pavlov found that a dog could learn to salivate not only to the sound of a bell but also to the sound of jangling keys. **Stimulus generalization**: Making the [same response to a slightly different stimulus] ([halo effect). ] Marketers can base some strategies on stimulus generalization: -- Family branding\ -- Product line extensions -- Licensing\ -- Look-alike packaging **Licensing** is contractually allowing a [well- known brand name to be affixed to the products of another manufacturer. ] **Stimulus discrimination** **Stimulus discrimination**: is the [opposite of stimulus generalization]: The ability to select a [specific stimulus from among similar stimuli.] The [consumer's ability to discriminate] among similar stimuli is the basis of a **positioning** strategy. **Instrumental conditioning or Operant conditioning** **IC** *occurs* when we **[learn]** to **[perform]** behaviors that **[produce] [positive] [outcomes]** and [avoid] those that yield [negative] [outcomes]. -IC suggests that consumers [learn by means] of **a trial-and-error** process in which some purchase behaviours result in more favourable outcomes (i.e., rewards) than other purchase behaviours. In instrumental conditioning, the [stimulus that results in the most satisfactory response is the one that is learned. ] -IC: learning take place over time, while the [learner attempts and abandons other behaviors that don't get reinforced. ] **How Does Instrumental Conditioning Occur?** Instrumental conditioning occurs in one of three ways: 1. **Positive** **reinforcement** occurs when the person [receive a reward] after a specific behavior. 2. **Negative** **reinforcement** occurs when the person [avoid a negative outcome. ] 3. **Punishment** occurs when [unpleasant events follow a response]. Used to [discourage] [behavior.] ***Extinction*** occurs when [there is no reinforcement]: the [conditioning is not activated] because it is not reinforced. **Positive or negative reinforcement?** -- Ad showing beautiful hair as a -- Ad showing wrinkled skin as reinforcement to buy shampoo. reinforcement to buy skin cream  **Reinforcement Schedules** Several schedules are possible: **Fixed-ratio reinforcement** occurs only after a [fixed] number of responses. **Variable-ratio reinforcement:** person get [reinforced after a certain number of responses,] but [don't know] how many responses are required. **Fixed-interval reinforcement:** the [first response you make brings the reward] and then on a [specific set] interval, future rewards are given. **Variable interval reinforcement:** one [doesn't know] when the reward will be offered E.g. [Marketing applications of instrumental conditioning principles ] - A thank you letter or follow- up calls after purchase. - Frequency marketing. - Popup sales. - Provide samples and free trials. - Make the product the ultimate reward ***Gamification*** Millennial have growing up playing games. [Important elements of gaming: ] --  A dynamic digital environment --  Multiple short and long-term goals --  Rapid and frequent feedback --  A reward for most or all efforts in the form of a badge or a virtual product --  Friendly competition a low-risk environment --  A manageable degree of uncertainty. ***Gamification:** "[taking techniques that make games engaging and addictive and applying them to things that are not games.]*" ***Gamification-example*** The Challenge: Google, like many companies, needed more of its employees to submit travel expense information on a timely and regular schedule. Gamified Solution: When Google employees take a work trip, they receive an allowance for each location. Google gamified the expense process by [letting employees who didn\'t spend their entire allowances choose what happened to the remaining money] --- getting paid out in their next paycheck, saving funds toward a future trip or donating it to a charity of their choice. Results: Gamifying Google\'s travel expense system translated into 100 percent compliance within six months of launching the program. **Cognitive learning theories** -- Learning through [thinking] [and] [problem] [solving], which enables individuals to gain some [control] [over] [their] [environment]. -- Cognitive learning is based on mental activity. **Is learning conscious or not?** A lot of [controversy surround the issue] of whether or not [people are aware of their learning process]. Some evidence support the existence of nonconscious procedural knowledge. ***Mindlessness*:** processing information in an [automatic passive way]. [Cognitive learning theorists argue] that even conditioning [occurs because] subjects develop [conscious hypotheses and then act on them.] **Observational learning** **Observational learning** occurs when [we watch the actions of others] and note the reinforcements they receive for their behaviors. learning occurs as a result of ***vicarious*** [rather than direct experience]: -- [People store these observations in memory] as they accumulate knowledge and then they [use this information at a later point] to guide their own behavior. -- Modeling is the [process of imitating the behavior of others]. **How do we learn to be consumers** **Consumer socialization :** is the process " by which [young people acquire skills, knowledge, and attitudes relevant to their functioning in the marketplace.]" *From where does this knowledge come from? Friends, Schools*, *Parents* **Five Stages of Consumer Development** **Stage 1: Observing** Children start observing marketplace behaviors as early as [1 month] old. **Stage 2: Making requests** The earliest onset is around [2 years old, with the median age at approximately 3 years.] **Stage 3: Making selections** Begins as early as [3 years, with a median onset age of about 4] years. **Stage 4: Making assisted purchases** Children start making purchases with assistance from adults around age [4, with the median onset around 5 years.] **Stage 5: Making independent purchases** The earliest independent purchases occur around age [4, with the median onset age being approximately 8 years.] **Cognitive Development** **Limited**: Children who are [younger than age 6 do not employ] storage-and-retrieval strategies. **Cued**: Children between the ages of [6 and 12 employ these strategies] but only when prompted to do so. **Strategic**: Children [12 and older spontaneously] employ storage-and-retrieval strategies. **Multiple-intelligence theory**: his influential perspective argues for other types of intelligence, such as athletic prowess or musical ability, [beyond the traditional math and verbal skills psychologists use to measure IQ. ] **In sum**  **My brain is FULL!!** Scientist estimate brain's memory storage capacity to something [closer to around 2.5] [petabytes] (or a million gigabytes) **3 million hours of TV shows (watching the TV for over 300 years!)** **Memory** is a [process] of [acquiring] in formation and [storing] it over time so that it will be [available when we need it. ] Information-processing approach\ Mind = computer data = input/output A close-up of a sign Description automatically generated **Memory Systems:** 1. **Sensory Memory** This stage [temporarily] stores information received [from the senses].Information lasts only a [couple of seconds before either fading or being transferred] for further processing. 2. **Short-Term Memory (STM) or Working Memory** Stores information for a [limited time and has a limited capacity]. The information in STM can be stored in two ways: - **Acoustically:** Based on how it [sounds]. - **Semantically:** Based on its [meaning]. **Chunking:** [Information is often grouped into \"chunks,\"] which are familiar configurations or patterns that make it [easier to remember as a unit.] 3. **Long-Term Memory** [Allows for the retention of information] over a long period. Information can be [transferred from STM to long-term memory] through a [process] known as **elaborative rehearsal.** This involves [deeper processing of information] (e.g., repetition or relating it to existing knowledge), which [enhances memory retention.] 4. **Elaborative Rehearsal and Marketing** Marketers can [facilitate elaborative rehearsal by creating catchy slogans or jingles, encouraging repeated exposure] to the information, which [helps embed it in long-term memory.] **How our memories store information** Recent research suggests that [long-term memory and short-term memory are interdependent systems. ] **Activation models of memory**: -- [depending on the nature] of the processing task, different levels of processing occur that activate some aspects of memory rather than others. -- The [more effort it takes to process information], the more likely it is that information will [transfer into long-term memory. ] **An associative network for perfumes** The other products we [associate] with an individual product [influence how we will remember it. ]  **Level of knowledge** Knowledge is [coded at different levels of abstraction and complexity]. ***Meaning*** concepts get [stored as individual nodes] (e.g. macho). A ***proposition*** (or ***belief***) [links two nodes together to form a more complex meaning], which can serve as a single chunk of information ( Axe is cologne for macho men). [Propositions are integrated] into a ***schema*** (a cognitive framework that is developed through experience). **Script** (type of schema) a [sequence of events an individual expects]. E.g., ***service scripts*** guide our behavior in commercial settings (e.g. dentist, spa, classroom). **How we retrieve memories when we decide what to buy** **Retrieval** is the [process whereby information is accessed from long-term memory.] [Differences] in retrieval ability among people can be [attributed to individual cognitive, physiological, and situational factors. ] **Situational factors:** - ***pioneering brand vs. follower brand*** - **spacing effect:** tendency to [recall printed material more effectively] when the advertiser repeats the target item periodically rather than presenting it repeatedly in a short time period. - **viewing environment** - **Ad itself.** **Understanding When We Remember** **State-dependent retrieval**: we are better able to access information [if our internal state] is the [same at the time of recall as when we learned the information.] **Familiarity and recall**: we are more likely to recall messages about [items we are already familiar with. ] -- Importance of brand awareness -- Warning: automaticity **Salience and the "von Restorff" effect** (novelty):\ -- Explains why [unusual advertising or distinctive packaging tends to facilitate brand recall] -- [The intensity and type of emotions we experience] at the time affect the way we recall the event (*good things seem even better and bad things even worse*). **Viewing context\ **-- Almost 1/3 will [remember] brands whose products were [placed in shows they enjoy ] **Pictorial versus verbal cues** -- Some evidence for the superiority of [visual memory over verbal memory ] **Measuring Memory for Marketing Stimuli** Recognition (Aidedrecall) vs. Recall (Unaidedorfree recall) **Problems with memory measures** -- Response biases -- Memory lapses **Omitting**: [leaving facts out ] **Averaging**: tendency to ["normalize" memories] by not reporting extreme cases **Telescoping**: in [accurate recall of time] **The Marketing Power of Nostalgia** "Back to the glory days" Marketers may [resurrect popular characters to evoke fond memories] of the past -- Nostalgia\ -- Retro brand (e.g. Mini Cooper, PT Cruiser, and Volkswagon's New Beetle) **Topic 6:** **What is an attitude?** A [learned] predisposition to [behave in a consistently favorable or unfavorable] manner with respect [to a given object]. Attitude object (AO): anything toward which one has an attitude. Attitude is **[lasting]** : tend to endure over time. Attitude is **[general]**: it applies to more than a momentary event. Attitudes are [**consistent** with behavior.] Attitudes are [**not** **permanent**] and can change either seldom or frequently. **Attitudes have [direction, degree and strength ]** -- Positive or negative -- Extent of positive or negative feelings -- Strength of feelings Attitudes are **[learned]**. **Functional Theory of Attitudes (Daniel Katz)** This theory suggests that [attitudes exist because they serve some function] for the person. [Two people] can have an [attitude] toward some object for [very different reasons.] **UTILITARIAN FUNCTION:** Relates to [rewards and punishments] **VALUE-EXPRESSIVE FUNCTION:** Expresses consumer's [values or self-concept] **EGO-DEFENSIVE FUNCTION:** [Protect] ourselves from [external threats or internal feelings] **KNOWLEDGE FUNCTION:** [Need for order, structure, or meaning] \"As marketers, we [need to know why an attitude is formed in order to be able to change it].\" **The ABC model of attitudes** Attitudes are [more complex than they first appear]. An **attitude** has [three components]: **Affect**: [Felling]; the way a consumer feels about an attitude object **Behavior**: [Doing]; person's intentions to do something (take action) with regard to an attitude object **Cognition**: [Knowing]; is what the consumer beliefs to be true about an attitude object **Hierarchies of effects** A diagram of a diagram Description automatically generated **How are attitudes formed?** Attitude formation: The shift from no attitude to an attitude (is a result of learning) -- **Classical conditioning:** Through [past] associations. -- **Operant** **conditioning:** Through [trial and reinforcement] -- **Cognitive learning:** Through [information processing] Different sources influence the [formation of attitudes]: -- Personal experience/personality factors -- Influence of family and friends -- Culture and society -- Media/ Internet/Social Media -- Marketing **All attitudes are [not created equal]**  **Consistency Principle** 7UP is my favorite soft drink. It taste terrible. We [value/seek harmony among thoughts, feelings, and behaviors] This is the basis for **the** **principle** **of** **cognitive** **consistency**. Theory of cognitive dissonance states that when a [person is confronted with inconsistences] among attitudes or behaviors, he will [take some action to resolve this "dissonance".] **Consistency Principle** -- I know that smoking cigarettes causes cancer [dissonance] -- But, I smoke cigarettes We reduce dissonance when we eliminate, add, or change elements -- **Change** **the** **behavior** ([Eliminate]): stop smoking -- **Trivialization** ([Add]): My uncle died at he age of 95, and he start smoking at the age of 12 -- **Change** **the** **belief** ([Change elements]): Questioning the link about smoking and cancer; Others research failed to establish this link **Self-perception** **theory** describes the [process in which people, lacking initial attitudes or emotional responses, develop them] by [observing their own behavior and coming to conclusions] as to what attitudes must have driven that behavior. -- Individual infer the attitude from their own behavior Eg: I guess I like the consumer behavior course. I seem to forget time when I am working on it. Self-Perception Theory helps to explain the effectiveness of following sales strategies 1. **FOOT-IN-THE-DOOR TECHNIQUE** Consumers are [more likely to comply with a larger request if they have first agreed] to comply [with a smaller request.] 2. **LOW-BALL TECHNIQUE** A person is [asked for a small favor] and, [after agreeing], is [informed that it will be very costly]. 3. **DOOR-IN-THE-FACE TECHNIQUE**: A person is [first asked to do something extreme] (which they refuse), then asked to do [something smaller.] **Attitude models** How do you feel about....? Attitude models [specify the different elements that might work together to influence consumer's] evaluations of an attitude object. **Multiattribute** **Attitude** **Models** assumes that a consumer's attitude toward an attitude object [depends on the beliefs that she has about several of its attributes]. -- **Attributes**: [characteristics] of the attitude object -- **Beliefs**: [cognition] about the attitude object -- **Importance weights**: reflect the [importance] of the attribute. **Fishbein model** is the [most influential one] **The Fishbein Model** 1. **Salient Beliefs**: These are the [beliefs people have about the object] (e.g., product, brand, or service). These beliefs are [significant to the consumer\'s attitude formation]. 2. **Object-Attribute Linkages**: This refers to the [probability] that a particular object (e.g., a product) [has an important attribute that matters to the consumer]. 3. **Evaluation of Each of the Important Attributes**: This refers to [how the consumer evaluates the importance and value of each attribute of the object] (e.g., the quality, price, design). These three components together **contribute to forming a consumer\'s overall attitude** toward a product or service. **Marketing Applications of the Multiattribute Model** 1. **Capitalize on Relative Advantage**: Focus on [highlighting the product\'s strengths compared to competitors], making the relative advantage clear to consumers. 2. **Strengthen Perceived Linkages**: Emphasize the [connection between key attributes and benefits] of the product, reinforcing why these attributes matter to the consumer. 3. **Add a New Attribute**: Introduce a [new feature or attribute] that will appeal to consumers and enhance the product's appeal. 4. **Influence Competitor's Ratings**: [Change the consumer\'s perception of competitors] by highlighting the competitor's weaknesses or shortcomings, influencing their ratings and making your product appear more favorable. \^\^\^These strategies [aim to shift consumer attitudes in favor] of a particular product or service.  Influence Competitor's Ratings Capitalize on Relative Advantage A clear plastic bottle with a blue cap Description automatically generated  Add a New Attribute Strengthen Perceived Linkages (new & improved) **How do marketers change attitudes? the art of Persuasion** **Persuasion** involves an [active attempt to change attitude]. **Basic psychological principles that influence people to change their minds or comply with a request** 1. **Reciprocity**: People are more likely to give [if they first receive]. Example: If a company offers a free sample, consumers feel a sense of obligation to reciprocate by purchasing the product. 2. **Scarcity**: People tend to find things that [are not readily available more desirable]. Example: Limited-time offers or \"only a few items left\" messages encourage urgency and can drive sales. 3. **Authority**: People tend to [believe authoritative sources]. Example: Celebrity endorsements or expert opinions can enhance the credibility of a product. 4. **Consistency**: People [try not to contradict what they have said before]. Example: If a person has previously expressed an interest in a brand, they are more likely to stay loyal to it in future purchases to maintain consistency with their past behavior. 5. **Liking**: People tend to [agree with those they like or admire]. Example: Brands often use likable spokespersons or influencers to promote products because consumers are more likely to be persuaded by someone they admire. 6. **Consensus**: People will [consider what others do before deciding what to do]. Example: Customer reviews and testimonials influence potential buyers by showing that others have had positive experiences with the product. \^\^\^These principles can be applied by marketers to influence consumer decisions and behaviors effectively. **The elements of communication** **The [Traditional] Communications Model** A diagram of a customer feedback Description automatically generated In the past the common medium used was what we [called traditional media] (Broadcast media mainly , TV & Radio) **The communication process** **An [updated] Communications Model**  This model reflect better the use of [new media] ( **narrowcast**) that allow for [more customized and interactive message] **The source** The source of the message is a [key factor that impact on the likelihood that consumer will accept the message. ] Several factors **influence the effectiveness** of a message source: -- **Credibility** -- **Attractiveness** (appearance, personality, social status, and similarity to the receiver) **Credibility** **Credibility** **refers** **to** **a** **communicator\'s** [**expertise,** **objectivity,** **or** **trustworthiness**] : how this person is competent ? It works: -- When consumer [need to learn] about the product [or form an opinion] -- We want to [change attitude toward utilitarian products that have high risk performance ] - [Celebrities] increase [awareness] of a firm's advertisement and [enhance both company image and brand attitudes. ] the [effect is stronger when the source's qualifications are relevant] to the product endorsed. **Attractiveness** **Source** **attractiveness** refers to the [perceived social value the message receivers associate with the source.] It is related to [appearance, personality, social status], and [similarity to the receiver.] We like to listen to people who are similar to us (**halo effect**) It works: When [used for products with high social risk], such as jewelry and furniture. When [consumer motivation to process the adv. is low], attractive source enhance the favorability of the consumer **The message** The message is the [thought, idea, attitude, image, or other information] that the sender wishes to [convey to the intended audience]. - **Verbal** (spoken or written) - **Nonverbal** ( photograph, illustration, symbol) or a **combination of the two**. The message objectives: Create awareness Promote sales Encourage/discourage practices Attract patronage Reduce dissonance Create goodwill/favorable image **Message Decisions** Images and text Message framing: **Positive** **framing**: stress the [benefits to be gained] by using a specific product (work better with persons with high need for cognition; independent self-view) **Negative** **framing**: the [benefits to be lost] by not using the product (work better with persons with low need for cognition; interdependent self-view) One-sided vs. two-sided messages **One-sided** **message** pretends that its products are the [only ones of their kind. ] **Two-sided** **message** [acknowledges competing] products Repeat the message **Mere** **exposure** **effect**: when [familiarity leads to a consumer's liking] an object **Types of message Appeals** **Emotional** **appeals** **Rational** **appeals** **Moral** **appeals** **Rational appeals** show that the [product will produce the desired benefits]. Examples are messages showing a product's quality, economy, value, or performance. **Fear Appeals** When do they work? When are they unlikely to work? -- Some researchers have found a [negative relationship between the intensity of fear appeals and their ability to persuade], so strong fear appeals tend to be less effective than mild fear appeals **-- Fear + disgust work better than only fear** -- [Social threat are more effective than physical] threats appeals -- [Fear appeals are unlikely to be effective among persons who score high on the personality variable] termed **sensation** **seeking**. **Humor appeals** - attracts [attention & enhances liking] of the product. [Humor that is relevant to the product is more effective] than humor unrelated to the product. Humor is [more effective in ads for existing products] than in ads for new products, and more effective in targeting consumers who already have a positive attitude toward the product. Humor is [more appropriate for advertising low-involvement] than high-involvement products. The [impact of humor is related to the receiver's personality and demographic] characteristics **Advergaming** Advergaming [refers to online games merged with interactive advertisements] Advertisers [gain many benefits] with advergames **Plinking** is the [act of embedding a product in a video]