consumer-behaviour-lecture-notes-2020-sem-1.pdf

lOMoARcPSD|46450428 Consumer Behaviour Lecture Notes 2020 SEM 1 Consumer Behaviour (University of Western Australia) Scan to open on Studocu Studocu is not sponsored or endorsed by any college or university...

lOMoARcPSD|46450428 Consumer Behaviour Lecture Notes 2020 SEM 1 Consumer Behaviour (University of Western Australia) Scan to open on Studocu Studocu is not sponsored or endorsed by any college or university Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428 Introduction to Consumer Behaviour (Week 1) Ch. 1  What is marketing? o The creation and communication of value o Finding, communicating and sustaining that competitive advantage that makes a company great  Underlying marketing is Consumer Behaviour  Hyundai ad: o Aired in 2009 during the GFC (Global Financial Crisis) o What are people afraid of in GFC? Losing jobs  Understanding CB: o Marketing Strategy  Global marketing  Positioning strategy – how your target segments think about the company based on what you put out there  Marketing mix  New market applications  CB audit  Market segmentation – Dividing larger groups into smaller, more easily targeted groups o Segmentation:  Geographic  Demographic  Psychographic – based on lifestyle  Behavioural Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428  It involves identifying consumer groups with unique needs and/or purchasing processes, and developing specific marketing programs targeted at individual groups o Positioning – what you want your consumers to think about the product  CB is a product-person-situation specific: a discipline dealing with how and why customers purchase or don’t purchase products and services  To be successful, a new product must be designed and marketed to solve a consumer problem  7 Ps of marketing: o Product o Price o People o Promotion o Process o Place o Physical Evidence 2 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428 Perception (Week 2) Ch.8  Information processing – a series of interlinked activities by which stimuli are transformed into information and stored  Perception – the process by which we notice, attend to and interpret the stimuli – objects, messages and events – that we encounter in the world around us  The nature of perception: o Exposure; random or deliberate o Attention; low or high involvement o interpretation; low involvement or high involvement o memory; long term or short-term memory  Exposure o When a stimulus comes within range of our sensory receptor nerves o Deliberate exposure to stimuli  The stimuli are exposed to the consumer  Consumers seek information to achieve certain goals o Random exposure to stimuli o Generally, consumers seek information that they think will help them to achieve certain goals; immediate or long term o Absolute threshold: whether the size of the stimulus is detectable by any of the senses o Selective exposure: the process by which individuals deliberately seek out exposure to certain stimuli and avoid exposure to others  Attention o When perceived stimulus goes to the brain for processing o Determined by: 3 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428  Stimulus factors: contrast, position and size  Individual factors  Situation factors o How many brands have you seen today? o Stimulus factors  the physical characteristics of the stimulus itself, such as of television advertisement  size and intensity  color and movement  position: location of stimulus  Isolation: separation of a stimulus object from other objects  format: the manner in which the message is presented  contrast: tendency to attend more closely to stimuli that contrast with their background than to stimuli that blend it  compressed messages: sped up messages to increase attention  Information quantity Adaptation level theory – theory that people adjust to the level and type of stimulus to which they are accustomed – e.g. ad that stands out when new will eventually lose its contrast effect o Changes to stimuli  Consumers become accustomed to and filter out expected stimuli: e.g if you drive seeing the same ad, you will eventually ignore it 4 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428  Absolute threshold: lowest level of stimulation needed for the senses to detect  Differential threshold  The ability to notice changes or differences in levels of stimulation  JND (Just Noticeable Difference) is the minimum change in stimulus required for consumers to notice the difference  Weber’s law: the larger the initial stimulus, the bigger the JND o Individual factors:  Consumer that are likely to influence how they perceive and process information.  Individuals differ in their ability to attend to information as well as in their level of curiosity  Perceptual vigilance: heighten awareness of stimuli relevant to current needs  Perceptual defense: decrease awareness of stimuli not relevant to current needs o Situational factors: Elements in the environment other than the focal stimulus that are likely to influence consumer behaviour  Involvement  Non focused attention: stimuli may be attended to without deliberate or conscious focusing of attention. Eg hearing your name when at a party  Hemispheric lateralization: two sides of the brain control different types of activities  Subliminal messages: a message that is not consciously attended to by the audience exposed to it, exposed too fast or softly 5 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428  Subliminal advertising has little to no effect, ineffectual  Interpretation o Gestalt Theory:  The closure principle: people tend to perceive an incomplete picture as complete. That is we tend to fill in the blanks based on prior experience  The principle of similarity: consumers tend to group together objects that share similar physical characteristics  The figure ground principle: one part of a stimulus will dominate (the figure), and other parts receded into the background (the ground) o Cognitive interpretation  Categorization of stimuli  Stimuli are placed within existing categories of meaning  The addition of new information to an existing category also alters that category and its relationships with other categories o Affective interpretation  Processing and adding meaning by feeling  Essentially the emotional response triggered by the stimuli 6 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428  for example, featuring pets in ads capitalises on the rich emotional relationships people have with their pets  Individual characteristics: o Learning: prior learning provides the framework within which people interpret and give meaning to new events and data o Expectations  Situational characteristics: o Temporary characteristics of the individual, such as hunger or loneliness, influence the interpretation of a given stimulus, as do moods o The amount of time available also affects the meaning assigned to marketing messages. o Physical characteristics of the situation – temperature, number and characteristics of other people present, the nature of the material surrounding the message in question, external distractions, the reason the message is being processed – affect how the message is interpreted. o In recognition of the critical importance of the meanings associated with stimuli, marketers are beginning to used semiotics o Semiotics – the study of how meaning is created, maintained and altered o Factors directly related to the product, such as its country of origin, can have a great influence on the meaning assigned to the product  Advertising evaluation: o Exposure – it must physically reach the consumer o Attention – it must be attended to by the consumer o Interpretation – it must be properly interpreted o Memory – it must be stored in memory in a manner that will allow retrieval under proper circumstances 7 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428 Learning (Week 3) Ch.9  Learning - any change in the content or organization of long-term memory; the result of information processing  Learning also plays an important role in maintaining established social norms, or the accepted attitudes and behavioral patterns in a given situation  Learning under conditions: o High involvement learning situation – a situation where the consumer is motivated to learn o Low involvement learning situation – a situation where the consumer has little to no motivation to learn or process the material  The concept of involvement is multidimensional: the degree of involvement experienced by the customer depends on the characteristics of the individual, the object and the situation.  Advertisers prefer high involving customers as they are more susceptible to learning their products and more likely to remember them  Highly involved customers are also able to differentiate between products and features. Which ones are the best and which feature is right for my situation?  Conditioning – using established relationship between a naturally occurring (unconditioned) stimulus and the natural occurring (unconditioned) response to that stimulus to bring about the association of that same (conditioned) response to a different (conditioned) stimulus o Classical conditioning:  Establishing a relationship between stimulus and response to bring about learning of the same response to a different stimulus 8 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428  Most common in low involvement situations  Learning is more often a feeling or emotion than information o Operant Conditioning:  Giving subjects reinforcements for every time they do something desirable and punishments for something undesirable  Example: birthday vouchers from restaurants  Cognitive learning – information-based learning o Iconic rote learning – association between two or more concepts in the absence of conditioning  Substantial amount of low involvement learning  Achieved by repeated ad messages  Eg Woolies Fresh Food Updates o Vicarious/modelling  You mock/follow a person’s behavior o Reasoning  Most complex form of cognitive learning  Hight involvement learning  General characteristics of learning o Strength of learning influenced by:  Importance and relevance  Involvement  Mood  Reinforcement or punishment  Stimulus repetitions  Imagery o Extinction 9 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428  Forgetting occurs when reinforcement of learning is withdrawn o Stimulus generalization  Brand equity and/or leverage  Often used by cheap brands to mimic prestige brands (hence trademarks)  Eg tommy Hilfiger’s line of handbags that mimics Gucci’s monogrammed look o Stimulus discrimination  Why a brand is different  Competing brands owned by the same company o Response environment  Strength of original learning  Similarity of original learning environment to the retrieval environment  Short term memory o Elaborative activities – use of previously stored experiences, values, attitudes, beliefs and feelings to interpret and evaluate information o Maintenance rehearsal – continual repetition of a piece of information  Long Term memory o Semantic memory – basic understanding of an object o Episodic memory – memory of a sequence of events  Eg first car, summertime  Ads can evoke this through narrative advertising  Schematic memory o Association of concepts and episodes with others, forming patterns 10 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428 o Brand image refers to the associations that the consumers have with a brand o Marketers want to influence these associations  Brand equity and leverage o Reputation and willingness to pay for a brand o Leverage is based on stimulus generalization 11 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428 Motivation (Week 4) Ch.10  Motivation: o The emerging force that activates or triggers behaviour o Provides purpose, direction and drive  Theories of motivation o Maslow’s hierarchy of needs  Physiological – basic needs such as food, water, shelter  Safety – refers to physical safety, security and stability  Belongingness – the desires for love, friendship, affiliation and group acceptance  Esteem – desire for a place in society or organization or in one’s respect  Self-actualization – a desire for personal fulfillment, only when the others are successfully satisfied o McGuire’s psychological motives  Cognitive preservation motives  Need for consistency  Need to attribute causation-  Need to categorise – organize info  Need for cues – the need for observable cues to infer what is felt and known  Cognitive growth motives  Independence – in control  Novelty – variety and change  Teleological – want things to go the way we think they will  Utilitarian – learn new info to solve problems 12 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428  Affective preservation motives  Need for tension reduction  Self-expression – show id and self-concept  Ego-defense - protect  Reinforcement – rewards  Affective growth motives  Assertion – increase self esteem  Affiliation – mutual and satisfying relationship  Identification – adopt new roles  Modelling – base behaviours on others Cognitive motives focus on the individual’s need for being adaptively oriented towards their environment and achieving a sense of meaning Affective motive focus on the individual’s need to reach satisfying feeling states and attain personal goals. Preservation oriented motives emphasizes the individual maintaining equilibrium Growth emphasizes development  Discovering purchase motives o Manifest motives – motives that are known and freely admitted o Latent motives – either unknown to the individual or individual is reluctant to admit them 13 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428  Projective techniques in motivation research o Association techniques  Word association: consumers respond to a given word  Successive word association: consumers give the series of words that comes to mind after hearing each word in a list  Analysis and use: whether there is emotional associations from responses o Completion techniques  Sentence completion  Story completion  Analysis and use: which themes evoke responses o Construction techniques  Cartoon techniques  Third person techniques: why people buy a certain product 14 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428  Picture response: consumers tell a story about a person who is shown  Analysis and use  Investigating Metaphors being seen as a way to deep meanings and a s a means of probing both manifest and latent motivations  Zaltman Metaphor Elicitation Technique (ZMET): uses qualitative methods to elicit the metaphors, constructs and mental models that drive consumers’ thinking and behaviour  Netnography – investigate the consumer behaviour and cultures present on the internet  Direct appeals are generally effective for manifest motives, since these are the motives that consumers are aware of and are willing to discuss.  Latent motives are difficult to implement but occasional direct appeals can be used. This type of motive can be determined by projective motivation-research techniques, such as word association, sentence completion and use of metaphor.  The overall campaign should try to position the product in the schematic memory of the target market in a manner that corresponds with the target market’s manifest and latent motives for purchasing the product.  Motivational Conflict - the outcome of different motives driving consumers to opposite behaviors o Approach – approach: a situation where a consumer faces a choice between two attractive alternatives.  Eg – a holiday in Italy or buying a large screen plasma TV o Approach – avoidance: consumer faces both positive and negative consequences in the purchase of a particular product.  Eg – consumer want the emotional satisfaction of fast food but does not want to gain weight o Avoidance – Avoidance: facing two undesirable alternatives 15 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428  Eg – not wanting to spend money on washing machine but also not wanting to go without one  Individual personality theories – all individuals have internal characteristics or traits and there are consistence and measurable differences between individuals  Five factor model of personality – o Extraversion/neurotocism o Instability o Agreeableness o Openness to experience o Conscientiousness  Social learning theory – emphasise the environment as the important determinant of behaviour  Social theorists claim that the situations that people face are the result of different situations. Behaviour is a result of some combination of individual traits and the situations people face  Within a marketing context, insight into an individual’s personality through their use of social networking may give insight into how to attract consumers’ attention by matching personality traits to marketing communication.  Brand Personality – a set of human characteristics that become associated with a brand. For example, a perfume might project youth, sensuality and adventure 16 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428  People will assign personalities to brands based on factors including the characteristics of the product category, the brand’s features, its packaging and its advertising  Emotions: o Strong, relatively uncontrolled feelings that affect our behaviour o Physiological changes during emotional experiences has led to the theory that physiological responses precede emotion. o It is the shaping of these physiological experiences through a process of attribution that constitutes the emotional reaction o The types of thoughts and our ability to think rationally vary with the type and degree of emotion  Marketers have always used emotions on an intuitive level to guide product positioning  Consumption related feeling or experiential aspects of consumer behaviour reflects a ‘hedonic’ perspective  Emotional arousal that engages consumers towards an anticipated experience is considered a type of response related to hedonic consumption  Various products are designed to deal with anxiety or depression. People often visit shopping centres, department stores or retail outlets to alleviate boredom, to experience excitement or desire, or to engage in ‘retail therapy’.  Marketers are recognizing the importance of designing retail environments to create these emotional experiences  The emotional content of advertisements enhances their attention- attraction and attention-maintenance capabilities 17 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428 Attitude (Week 5) Ch.11  Attitude – a combination of motivational, emotional, perceptual, and cognitive processes  A learned predisposition to respond in a consistently favourable or unfavourable manner with respect to a given object  Attitude object – anything about which an individual can have an attitude  The consumer may hold an attitude with a varying degree of confidence, a factor that has been shown to reinforce the link between the attitude and behaviour  Attitudes formed on the basis of word of mouth may be held strongly than those formed from advertising and other marketing communications  Attitude components: o Cognitive – belief and knowledge of the attitude object o Affective – emotions, feelings about a specific attribute or object o Behavioural – behavioural intentions with respect to specific attributes or overall object  Principle of component consistency – a change in one attitude component tends to produce related changes in the other two components  Cognitive dissonance – individual experiencing inconsistency between attitude components  Post purchase – consumer resolve cognitive dissonance by changing, in a positive direction, how they think and feel about their purchase  Seven factors to reduce consistency between measures of beliefs o a favourable attitude requires a need or motive before it can be translated into action 18 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428 o translating favourable beliefs and feelings into ownership requires ability o Purchases often involve tradeoffs both within and between product categories o If the cognitive and affective components are weakly held and if the consumers get additional information while shopping, then the initial attitudes may give way to new ones o Many purchase decisions involve other household members, either directly or indirectly o Brand attitudes are generally measured independently of the purchase situation o It is difficult to measure all the relevant aspects of an attitude  Social marketing – marketing designed to change societal attitudes in an effort to enhance public health and well being  Now widely used to address public health issues pertaining to both individuals and society as a whole  Most often used in the domain of public health, through the introduction of education programs designed to reduce or prevent the incidence of lifestyle diseases and antisocial behaviours  Changing the cognitive component o Changing beliefs about the attributes of the brand – shifting beliefs about the performance of the brand on one or more attributes o Shifting importance – shift the relative importance away from attributes evaluated as poor to attributes that are positively evaluated. o Adding beliefs – rebrand, new product features o Changing the ideal – altering the perceptions of the ideal brand o Cognitive iconic rote learning  Changing the affective component 19 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428 o Classical conditioning – a stimulus that the audience likes, such as music, is consistently paired with the brand name o Affect towards the advertisement – positive affect increase liking for the brand, or it may be high involvement, conscious process. Use of humour, celebrities or emotional appeals o Mere exposure – repeatedly presenting a brand to an individual could make the individual’s attitude towards the brand more positive  Changing the Behavioural component o Operant conditioning – impacting behaviour through reward or punishment o Behaviour may precede the development of cognition and affect, or it may occur in contrast to the cognitive and affective components o Consumers often try new brands or types of low-cost items in the absence of prior knowledge or affect o The key to marketing task is to induce people to purchase or consume the product, or at least try it out – to ensure that the purchase or consumption will indeed be rewarding o Since behaviour often leads to strong positive attitudes towards the consumed brand, a sound distribution system is important to prevent current customers from trying competitor brands  Individual and situational characteristics influencing attitude change o sway who lack commitment and are therefore more likely to attend and respond to their messages o many advertisements are for low involvement products, in which case the consumer may just glance at the advertisement and make a quick mental connection without reading the text o ELM (Elaboration Likelihood Model) suggests that brand involvement is a key determinant of how the information is processed and how attitudes are changed 20 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428 o High involvement results in a central route to attitude change, whereby consumers deliberately examine, think about and process those messages o Low involvement results in peripheral route where consumers form impressions of a brand based on information readily made available  Source credibility – the degree to which the source of a message is viewed as credible or believable by the target market  Sleeper effect – a communication phenomenon according to which the discounting of the message from a non-credible source dissipates overtime, allowing the message to produce attitude changes similar to those delivered by a credible source  Appeal characteristics o Fear appeals – make use of the threat of negative consequences if attitudes or behaviours are not altered o Humorous appeals – get attention using jokes, puns etc o Comparative appeals – explicitly states how one brand or product compares with its competitors o Emotional appeals – evoke strong feelings, especially positive feelings o Value expressive appeals – creates a personality for the product or an image of the user o Utilitarian appeals – functional benefits important to them  Consumer Decision process o Problem recognition o Information search o Evaluation of alternatives o Purchase decision o Post Purchase Evaluation 21 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428 Problem Recognition (Week 6) Ch.3 and 4  Problem recognition is the first stage of the consumer decision process  Many decisions focus not on the brand attributes but rather on the feelings or emotions associated with acquiring or using the brand  A brand may be selected not because of an attribute (price, style, functional characteristics) but because “it makes me feel good” or “my friends will like it”.  Purchases and related consumption behaviour driven by emotional or environmental needs have characteristics distinct from the traditional attribute-based model  Purchase involvement – level of concern for, or interest in, the purchase process, once the purchase process has been triggered by the need to consider a particular purchase o Habitual decision making o Limited decision making o Extended decision making  Need recognition – when you have to purchase a product because it is broken, used fully or needed for your lifestyle,  Opportunity recognition – when you have the choice to buy the product, whether to upgrade or change brands of a product you already owned or a product you might need in the future, increasing ideal state.  Habitual decision making o Involves no decision o Very low involvement o Result in repeat purchasing behaviour o Problem is recognized, internal search (long term memory) provides a preferred solution (brand) o Two distinct categories 22 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428  Brand loyal decisions: decisions made by a consumer who displays a high degree of product involvement and emotional attachment to that brand  Repeat purchase decisions: pattern of consumer behaviour that involves the purchase of the same good or service overtime.  Limited decision making o Similar to habitual decision making o Eg a consumer may select a product without seeking information beyond internal memory that “it tastes good”; no other alternative to be considered o May occur in response to some emotional or environmental needs o May evaluate a purchase in terms of the actual or anticipated behaviour of others  Extended decision making o A very high level of purchase involvement o Extensive internal and external information search is followed by a complex evaluation of multiple alternatives o After the purchase, doubt about its correctness is likely and a thorough evaluation of the purchase will take place  The nature of problem recognition o The recognition of a problem was the result of a discrepancy between a desired state and an actual state o An actual state is the way an individual perceives their situation and feelings to be at the present time o Desired state is the condition the consumer would like to be in at this point in time o the kind of action taken by a consumer in response to recognized problem relates directly to the situation, its importance to the consumers and the dissatisfaction or inconvenience creates by the problem 23 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428  Desire to resolve recognized problems depends on two factors: o The magnitude of the discrepancy between the desired state and the actual state o The relative importance of the problem  Types of consumer problems o Active problem – a problem the consumer is aware of o Inactive problem - problem the consumer is NOT aware of o Active problem solution – convince consumer the marketer’s brand provides a superior solution 24 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428 o Inactive problem solution – convince them that they have problem and then provide them the marketer’s brand provides a superior solution  The necessary condition for problem recognition is a discrepancy what a consumer desires and what the consumer has  Factors influencing the desired state (factors that affect problem recognition) o culture/social class o reference groups o household characteristics o financial status/expectations o previous decisions o individual development o motives (Maslow and McGuire o emotions o the situation  Factors influencing actual state o past decisions o normal depletion o product/brand performance o individual development o emotions o the efforts of consumer groups and gov dept o availability of products o the current situation  Instrumental performance – the physical or functional performance of a product 25 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428  Symbolic performance – the symbolic, expressive, aesthetic or image – enhancement performance of a product  Mental development may lead to dissatisfaction with existing reading material or music collections  The development of skills may lead to dissatisfaction with current equipment  Since individuals generally desire either a neutral or a positive emotional state, emotions can be an important source of problem recognition  The current situation has a significant effect on perceptions of the actual state. the presence of others, physical conditions, temporal perspective and antecedent states are key elements of the actual state  Marketing strategy and problem recognition o First, they need to know what problems consumers are facing o Second, they must know how to develop the marketing mix to solve consumer problems o Third, they occasionally cause customers to recognize problems o Finally, there are times where marketers wish to suppress problem recognition among consumers  Measuring problem recognition o Intuition – where marketing manager can analyse a given product and determine logically where improvements could be made o The difficulty is that the problem identified may be of low importance to most consumers o One way of overcoming it is to do a survey o Focus groups – composed of 8-12 of similar individuals brought together to discuss a topic o Surveys and focus groups take one of 3 approaches to problem identification: Activity analysis, Product analysis and problem analysis 26 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428 o Activity analysis – focuses on a particular activity and determines what problems consumers face during those activities o Product analysis – examines the purchase and use of a particular product or brand o Problem analysis – starts with a list of problems then asks the respondents to indicate which activities, products or brands are associated with those problems o Human factors research – attempts to determine human capabilities in areas such as vision, strength, response time, flexibility and fatigue, and the effect of such things such as lighting, temperature and sound on these capabilities  Identifies functional problems of which consumers are unaware of o Emotion research – attempts to discover, the role played by emotions in the consumer decision process  Generic problem recognition – the recognition of a discrepancy that a variety of brands within a product category could resolve  Selective problem recognition – the recognition of a discrepancy that only one brand in the product category can resolve  Marketing strategies that can be used to activate problem recognition o Designing their marketing mix to solve the recognized problem o May involve product development or repositioning, a change in opening hours, a different price or a range of other marketing strategies o Marketing managers often want to influence problem recognition rather than react to it. They wish to generate generic problem recognition or induce selective problem recognition o Attempts to activate problem recognition generally focus on the desired state o Attempts to make consumers aware of the negative aspects of the existing state are also common 27 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428 o Marketers try to influence the timing of problem recognition by making consumers aware of potential problems before they arise o Marketing managers may try to minimize or suppress problem recognition by current users of their brands  Information search: o Internal search – use information from memory o External search – the focus of the search shifts to external stimuli relevant to solving the problem o Ongoing search (explanatory search) – search for information conducted both to acquire information for later use and because the process itself is pleasurable  A consumer decision requires information regarding: o The appropriate evaluative criteria for the solution of a problem o The existence of various alternative solutions o The performance level or characteristics of each alternative solution with respect to each evaluative criterion  Evaluative criteria o The feature or desired characteristics of a product required to meet the consumer’s needs; the features the consumer believes a product should have, such as suitable price, brand or ingredients o A potential objective of both internal and external search is the determination of appropriate evaluative criteria o Provide information designed to influence the evaluative criteria used by consumers  Appropriate alternatives o Awareness set – a set of brands of which a consumer is aware, composed of three sub categories; evoked set, inept set and inert set 28 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428 o Evoked set (consideration) – those brands that the consumer is willing to consider for the solution of a particular consumption problem o Inept (negative) set – the consumer actively dislikes the brands, those brands the consumers considers completely unworthy of further consideration when attempting to solve a consumption problem o Inert (indifferent) set – those brands of which the consumer is aware, but towards which they are basically indifferent  Consumer total external information searches o Non searchers o Limited information searchers o Extended information searchers  Cost vs benefits of external searchers 29 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428 o The benefits of an external information search may be tangible – they may include a lower price, a preferred style or a higher quality product o May also be intangible – include reduced risk, greater confidence in the purchase or even enjoyment of the search itself o The costs and benefits of using the internet for information search activities can include consumers accessing and contributing to product review sites o Investing time and energy required to report their own experiences with the products to benefit other potential buyers  Market characteristics o Number of alternatives (products, stores, brands) o Price range o Store distribution (geography, number of stores, proximity) o Information availability  Product characteristics o Price level and product differentiation o ‘positive’ (reinforcement) products  Consumer characteristics o Learning and experience o Shopping orientation – general approaches or patterns of external searches o Social status o Age and stage is the household life cycle o Product involvement o Perceived risk – associations of risk with unsatisfactory product performance, increase information search before purchase  Situational characteristics o Time 30 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428 o Recipient o Physical surroundings o Social surroundings o physical/mental energy  Marketing strategies based on information search patterns  Maintenance strategy o A strategy employed by marketers to maintain current purchase behaviour in a situation where the brand is purchased habitually by the target market o Consistent attention to product quality and distribution o A reinforcement advertising strategy o Brand must be defended against disruptive tactics of competitors  Disrupt strategy o Disrupts the existing decision pattern o Short term – attention attracting advertising simed to break habitual decision making o Long term – shift the target market into a more extensive form of decision making  Capture strategy o Consumers engage in limited decision making o Marketers need to provide information at the point of purchase  Intercept strategy o To intercept the consumer during their search for information on the brands in their evoked set 31 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428 o Consumers don’t seek info of the brand o Necessary to place considerable emphasis on attracting consumers’ attention  Preference strategy o Target market using extended decision making o Causes target market to select a brand already in their evoked set o Uses campaign that will result in the brand being preferred by members of the target market  Acceptance strategy o Attract consumers’ attention or motivate them to learn about the brand o Long term advertising to enhance low involvement learning o Extensive advertising with a string emphasis on attraction o Motive is to move the brand into the consumer’s evoked set 32 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428 Evaluating and selecting alternatives (Week 7) Ch.5 5 stages of product purchase - Problem recognition - Information search - alternative evaluation p - Purchase - Post purchase  Evaluative Criteria – features or desired characteristics of a product required to meet the consumer’s needs; the features the consumer believes a product should have, such as suitable price, brand or ingredients Nature of Evaluative Criteria  The type of evaluative criteria a consumer uses to make a decision may vary from tangible cost and performance features to intangible factors such as style, taste, prestige or brand image  Characteristics of the individual (age and product familiarity) and characteristics of the purchase situation (time pressure and the number of alternatives available) also influence the number of evaluative criteria considered 33 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428  If an advertising campaign for a company’s product convinces the target market that a particular evaluative criterion is both relevant and important, this may enable the company to gain a substantial advantage over competitors whose products lack this feature Which evaluative criteria are used?  Determining which criteria: direct or indirect methods of measurements  Projective techniques: measure feelings, attitudes and motivations that consumers may be unable or unwilling to reveal  Benefit of projective techniques is the ability to uncover evaluative criteria that are based on emotional motivations  Perceptual mapping: consumers judge the similarity of alternative brands without specifying evaluative criteria; these judgements are then processed by computer to derive a perceptual map of the brands, of which the consumer’s evaluative criteria are the dimension 34 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428 Determining consumers’ judgement of brand performance in terms of specific evaluative criteria  Rank ordering scales  Best worst scaling  Likert scale: agree to disagree scale  Semantic differential scale: fast-slow, expensive-inexpensive) Relative Importance of evaluative criteria  Constant sum scale  Conjoint analysis: provides data on the structure of consumers’ preferences for product features and their willingness to trade one feature for more of another o Conjoin analysis is always limited to the attributes listed by the researcher o Not well suited to measuring the importance of emotional responses nor can it determine the interaction between different evaluative criteria Individual judgment and evaluative criteria  Surrogate indicator: an attribute, such as price, used to estimate the level of a different attribute, such as quality 35 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428  Few customers apply direct judgement, based on knowledge of technology, engineering and craft  Many would make an indirect judgement, using the reputation of the brand or the price level to infer quality  Heuristics: mental rule of thumb used by consumers to assist in the decision-making process Common market beliefs The accuracy of individual judgments  Sensory discrimination: ability to distinguish between similar stimuli using one of the senses  Just Noticeable Difference (JND): the minimum amount of change in a stimulus that needs to occur for consumers to notice the difference  Examples: Packaging changes, logo, amount/change of ingredients  Consumers can have a very different levels of sensitivity to variations in prices depending on the actual numbers appearing in the price Use of surrogate indicators  Consumers often use an observable attribute of a product to indicate the performance of the product on a less observable attribute  Consumers’ reliance on an attribute as a surrogate indicator of another attribute is a function of the first attribute’s predictive value and confidence value 36 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428  Predictive value: consumer’s perception of one attribute is an accurate predictor of another  Confidence attribute: the consumer’s ability to distinguish between brands based on the surrogate indicator  Consumers may also use surrogate indicators when it is possible for them to assess some claims made about the product Price  has been found to particularly influence the perceived quality of durable goods (computers, kitchen appliances), and to a lesser extent services and non-durable goods (detergent and muesli bars)  Increasing levels of quality of home brand products may mean that in some cases the less expensive option is actually of higher than a more expensive brand  Price has been shown to act as a surrogate indicator when consumers feel their ability to judge the product is inadequate and their degree of involvement is limited Brand  Brand name often used as a surrogate indicator of quality  Levi’s, Apple, Nike, Toyota  Has been found to interact with or replace the effect of relative price The role of evaluative criteria in marketing strategy  Marketers recognize and react to the ability of individuals to judge evaluative criteria, as well as to their tendency to use surrogate indicators  Blind test: when consumers aren’t aware of the product’s brand name to evaluate the functional characteristics of the product and to determine whether a JND over a particular competitor has been obtained without knowing the product brand. 37 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428  Marketers may want to influence the list of evaluative criteria used by consumers.  Marketers want to make direct use of surrogate indicators Decision rules  Conjunctive decision rule: meet minimum standards on ALL key attributes  “I’ll consider all brands that are all right on the attributes I think are important”  Disjunctive decision rule: meet minimum standards on ANY key attributes  “I’ll consider all brands that perform really well on any attribute I judge to be important”  Elimination by aspects decision rule: start with the most important attribute and progressively eliminate options aspects  “I want to buy the brand that has an important attribute that other brands do not have”  Lexicographic decision rule: ranking their criteria in order of importance. The consumer then selects the brand that performs best on the most important attribute  “I want to get a brand that does best on the attribute of most importance to me. If there is a tie, I’ll break it by choosing the one that does my best on my second most important criterion”  Compensatory decision rule: overall evaluation where strong attributes can make up for weak attributes 38 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428 Outlet selection and product purchase (Week 8) Ch.6 and 7 Retail outlet – any source of goods or services for consumers  Outlet choice vs product choice: o Brand (or item) first, retail outlet second o Retail outlet first, brand second o Brand and retail outlet simultaneously  For many individuals and for many product categories, stores that brands form the evoked set  A brand-first decision sequence would suggest brand image advertising  An outlet-first decision sequence would tend to focus on point-of- purchase (POP) materials, distribution through key outlets, and programs to encourage good shelf space and support from sales staff  Traditional retail environment are changing and retailers are trying to evolve into internet retailing and gain more consumers online even though they are geographically far or even the concept of online shopping from anywhere can be appealing. Internet retailing  Retailers must know how much people spend on the internet, the types and goods they are buying and the frequency of purchase  Although online shopping is often valued by consumers because of its convenience and time-saving potential, many people still like shopping at retail outlets because this allows them to feel, touch and try on the products before they buy 39 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428 Multichannel outlet strategies  Most common form: online to store. Customers searches online and then buys at the physical store  Around 78% of internet shoppers use two or more channels to browse and buy  Multi-channel shoppers tend to have higher incomes and spend 15 to 30 per cent more with a retailer than single-channel shoppers  The ability to use a multi-channel strategy enables marketers to calculate which channel provides the most cost-effective means of accepting orders from different segments of customers and to encourage migration to the most cost-effective channel(s). Attributes affecting retail outlet selection  Retail format o Depends on whether it is high involvement or low involvement o In general, consumers will select convenience outlet for low- involvement or routine purchases o Low involvement shopping also takes place in most of the mass- merchandising retailers, including supermarkets, discount stores and mass merchandisers such as Kmart.  Outlet image o the image a consumer perceives from an outlet  Store brands o Closely related to outlet image are store brands 40 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428 o Items carried in the store are the store’s own brand o Home brands or private labels o High quality at reasonable price  Retail advertising o Spillover sale – when an additional item is purchased by a customer who has come to purchase an advertised item o To accentuate service, selection or the affective benefits of their outlets, as well as ensuring that the products on offer meet the value expectations of the target segments Consumer Characteristics and outlet choice  Shopping orientation o Individuals go shopping for more complex reasons than simply to acquire a product or set of products o Diversion from routine activities, exercise, sensory stimulation, social interactions, learning about new trends and even acquiring interpersonal power have been reported as non-purchase reasons for shopping  Perceived risk 41 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428 o The risk, customer view, attached to the purchase of a product In store influences that alter brand choices  Unplanned purchases – a purchase that a customer did not intend to make prior to entering the point of purchase o Lack of rationality or alternative evaluation o Allows the marketers to use knowledge of the target market, its motives and the perceptions process to increase sales of specific items o Nature:  Reminder purchases  Impulse purchases  Specifically planned  Generally planned  Substitute decisions  Unplanned decisions  In store decisions 42 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428  Point of Purchase displays o Also known as shopper marketing o Generally a strong increase in sales when displays are used o Often elaborate on attention grabbing o Designed to quickly communicate to get unplanned sales  Special features  Price discounts  Atmospherics o Hedonic vs utilitarian  Impact of stockout situation o Can negate loyalty and habit  Lost sale or substitute sale  What you’ll buy instead if they ran out of your fave brand o Negative consequences for the brand and the retail outlet  Attitudes  Word of mouth Post purchase processes, customer satisfaction and consumer loyalty 43 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428  Post purchase activities  Some purchases are followed by a post purchase dissonance, when consumers have doubts or regrets about their purchase  The probability that a consumer will experience post-purchase dissonance and the magnitude of such dissonance are a function of the following: o The degree of commitment of the decision o The importance of the decision o The difficulty of choosing among the alternatives o The individual’s consumer sophistication o The individual’s tendency to experience anxiety in general 44 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428  Dissonance occurs because, when a person makes a relatively permanent commitment to a chosen alternative, they also make the decision to give up the attractive features of the unchosen alternatives  Those requiring limited decision making will not produce post purchase dissonance  Consumers generally try to reduce the dissonance by: o Increasing the desirability of the brand purchased o Decreasing the desirability of the rejected alternatives o Decreasing the importance of the purchase decision o Reversing the decision  Customers commonly search for additional external information that servs to confirm the wisdom of a particular choice  Product use o Multiple uses, multiple products; increase use innovativeness of the product. Online Retailers use recommendation systems, suggesting complementary or related products o Regional use behaviour; product use can vary regionally. Tea with milk or no milk o Defective products; stringent product-liability laws are forcing marketing managers to examine how consumers use their products.  Product recall – when an unsafe product is recalled by the ,manufacturer, usually for a full refund or exchange.  How to minimise post purchase dissonance as a marketer: o Tell them they are working on the defects o Tell them the awards or many top reviews from real consumers o Tell them they are doing the right thing o Increase the use innovativeness 45 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428  Disposal o A product may no longer function physically in a manner desired by a consumer o Five main disposal options available: sharing, exchanging, donating, recycling or ridding o Four main ways in which disposal decisions can affect a firm’s marketing strategy:  Disposal sometimes needs to occur before the acquisition of a replacement, due to limitations of physical space or money  Frequent decisions by consumers to sell, swap or give away used products can result in a large used-product market, which can reduce the market for new products  Australians and new Zealanders are not “throw away” societies  Environmentally sound disposal decisions benefits society as a whole and, thus, the firms then comprise it  The evaluation process o in general, we tend to perceive performance as being in line with our expectations if it falls within an acceptable range o Satisfaction with a purchase is primarily a function of the initial performance expectations and the perceived performance relative to those expectations  Evaluation of a purchase is defined by perceived performance relative to expectations  Expectations are often set by brand communications  Dimensions of performance o core service failure 46 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428 o service encounter failures o pricing o response to service failures o attraction to competitors o ethical problems o involuntary switching  Type of performances o Instrumental – does the product achieve its required purpose? o Symbolic – does it enhance the consumer’s self-concept in a desired way? o Affective – does it generate positive feelings?  Four types of responses of dissatisfaction o Passives – rarely act when dissatisfied o Voices – they take direct action to complaining to the firm (desireable) o Irates – take private action o Activists – likely to take direct, private and especially public action. They strongly believe the benefits of complaining  Marketing strategy and dissatisfied consumers o The process of expectation management also involves making sure that any foreseeable disruption to the delivery of the firm’s good or service is promptly communicated to consumers to ensure that they do not react with excessive anger o Since dissatisfied consumers tend to express their dissatisfaction to their friends, dissatisfaction may cause the firm to lose future sales to the unhappy consumer as well as current sales to that consumer’s friends 47 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428 o Most consumers who complain want a tangible result. Failure to deal effectively with this expectation can increase dissatisfaction o Firms need to resolve the cause of consumer complaints rather than just allowing consumers an opportunity to complain  Repeat purchase behaviour o Brand loyalty - implies a psychological commitment to the brand  Biased  Behavioural response  Expressed overtime  By a decisions-making unit  With respect to one or more alternative brands out of a set of such brands,  A function of psychological processes 48 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428 Situational Influences (Week 9) Ch.2 Situation – a set of factors other than the individual consumer and the stimulus object Situational influences – the influence on purchase decisions of situational factors  Situational influences may have a direct effect on their own, but they also interact with individual and product characteristics to influence behaviour  In some cases, the situation will have no influence whatsoever, because the individual’s characteristics or choices are so intense that they override everything else Three important aspects of this influence:  When a particular situation will influence consumer behaviour  How strong the effect is likely to be 49 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428  The way in which the situation will influence behaviour Why is it important for a marketing manager to understand situational influences on purchasing behaviour? A marketer must understand when, to what degree and in what way these situational influences will affect a consumer’s decision to spend time engaging in that activity The consumption process occurs within four broad situations:  The communication situation – consumers receive info about good and services  The purchase situation – product selection and purchase occurs  The usage situation – consumption of goods and services  The disposal situation – product or its packaging is discarded before or after use Belk’s Classification of situational influences  Physical surroundings - include geographical and institutional location, décor, sounds, aromas, or other material surrounding the stimulus object  Social surroundings – provide additional depth to the description of a situation. Examples are the other people present, their characteristics, their apparent roles and the interpersonal interactions occurring  Temporal perspective – it is more about time. Whether it is seasonal, whether the product is urgently required, time availability to shop, how long the previous product lasted or expected to last  Task definition – whether the product is utilitarian or used as a status symbol, whether it is a gift or for personal use, whether it is long lasting or decorative or whether it is intended for several uses. 50 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428  Antecendent states – momentary moods (anxiety, pleasantness, hostility or excitation) Ritual situations  Important to marketers: they involve prescribed consumption behaviours  Each major holiday has consumption implications, involving special meals, cards and/or gifts,  For example, roses and teddy bears and chocolates represent valentines day Situational influences and marketing strategy  Given that situations do have an effect, how should marketing managers respond to them? and what actions should they take to influence the situation?  It is important to remember that individuals do not encounter situations randomly. Instead, people create many of the situations they face  For example: people who choose to engage in physically demanding sports such as jogging, tennis or squash are indirectly choosing to expose themselves to the situation of ‘being tired’ or ‘being thirsty’  This allows marketers to consider advertising and segmentation strategies based on the situations that individuals are likely to encounter, given their lifestyles. What are the marketing implications of situational influences?  Situational influences are pervasive and affect all areas of marketing decision making.  For example, retailers may be particularly concerned with physical surroundings as well as social surroundings.  Distribution strategies must often be devised to account for the temporal aspects of the purchase situation, and task definition must be 51 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428 encapsulated in positioning and pricing strategies. Antecedent states may explain the lack of response to any marketing activity How useful is the person-situation segmentation procedure?  Because consumers are different but often share needs when confronted with similar situational factors, it is useful to be able to combine personal characteristics as well as situational factors in the segmentation process. The person-situation segmentation procedure allows marketers to identify opportunities that might otherwise be neglected 52 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428 Group influences and communication (Week 10) Ch.14  Almost all consumer behaviour takes place within a group setting. Groups  serve as one of the primary agents of consumer socialization and learning.  Reference group – a group whose presumed perspectives or values are being used by an individual as the basis for his or her current behaviour.  Aspirational reference group – groups in which an individual does not belong to but to which they have a positive attraction, exert s a strong influence with respect to some products  Dissociative reference group – a group with whom consumers do not identify and with whom they wish to avoid association  Conformity – the tendency to want to be line relevant and significant others  Norms – general expectations about behaviours that are deemed appropriate for everyone within a particular social context, regardless of what position they hold.  The nature of reference-group influence o Informational influence – when an individual uses the behaviours and opinions of reference group members as potentially useful pieces of information o Normative influence – when an individual chooses to fulfill group expectations in order to gain a reward or avoid a punishment o Identification influence – when an individual uses perceived group norms and values as a guide for their own attitudes or values  Degree of reference-group influence 53 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428 o Strongest when the use of the product or brand is public or visible to this group o Increases as the degree of necessity of an item decreases o The more commitment to the group, the more that individual will conform to the norms of that group o The individual’s confidence in the purchase situation  Personal sales strategies o The Asch phenomenon: social pressure; influencing an individual within a group to conform and change a correct answer to the group’s incorrect answer of the same question  Advertising strategies o Informational o Normative o Identification 54 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428  Consumption subcultures: a distinctive subgroup of society that self selects on the basis of a shared commitment to a particular product class, brand or consumption activity o Activity based communities are the most common. Snowboarding, skateboarding, golfing o Brand communities are characterized by a shared sense of belonging among its members that distinguishes them from those outside the community  Marketing and consumption communities o Targeting products towards needs and motivations of the subculture  Skiers and skateboarders have different subcultures and consumption habits o Shared consumption rituals  Going to the same pub before football matches  Opinion leadership o Opinion leaders filter, interpret or provide information for individuals within groups o People may not search for information from the advertisement but through an opinion leadership o Situations in which opinion leadership occurs:  When one individual exchanges information with another  When one individual volunteers’ information  As a by-product of a normal group interaction  Identifying opinion leaders o Greater long-term involvement with a product category o Size and diversity of their social networks o Functions primarily through interpersonal communication and observation o Tend to be somewhat gregarious (sociable) than others 55 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428  Marketing strategy and opinion leadership o Identifying opinion leaders o Product sampling o Retailing/personal selling  Roles – a prescribed pattern of behaviour expected of a person in a given situation by virtue of the person’s position in that situation o we need to appreciate how individuals’ roles within groups influence their decision making o Role style – individual variations in the performance of a given role o Role parameters – represent the range of behaviours acceptable within a given role o Role commitment – desire to continue in the role position o Role overload – individual tries to fill more roles than their available time, energy or money allows o Role evolution – the behaviours and products appropriate for a given role change over time o Role stereotype – shared visualization of the ideal performance of a given role  Factors affecting the spread of innovations o type of group o type of decision o marketing effort o fulfilment of felt need o compatibility o relative advantage o complexity 56 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428 o trialability o perceived risk  Characteristics of individuals adopting an innovation at varying points in time o Innovators o Early adopters o Early majority o Late majority o Laggards 57 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428 Culture (Week 11) Ch.16  Culture – the knowledge, beliefs, arts, laws, morals, customs and any other capabilities and habits acquired by individuals as members of a particular society  Several aspects of culture o Culture is a comprehensive concept, including almost everything that influences an individual’s thought processes and behaviours o Culture is acquired, it does not include inherited responses or predispositions o The complexity of modern societies is such that culture rarely provides detailed prescriptions for appropriate behaviour  Norms – rules or expectations that specify or prohibit certain behaviours in specific situations, based on or derived from cultural values  Norms are derived from cultural values, which are widely held beliefs that affirm what is desirable within that culture  Conformism o Conformism to norms is usually given explicit and obvious rewards only when a child is learning the culture (socialization) or when an individual is learning a new culture (acculturation) 58 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428 o Most cultures socialize their members to conform to certain norms and boundaries (of dress, behaviour, how to spend and how to save) o Conformism also has a great deal of influence on how people within any given culture consume  Cultures are not static and typically evolve and change slowly over time. Marketing managers need to understand both the existing cultural values and the emerging cultural values of the societies they serve  Cultural sensitivity is an important business skill – someone with a high CQ (cultural quotient) can quickly grasp the key aspects of another culture and adapt well to different cultural environments  International marketers face a number of challenges regarding the use of social media for international marketing purposes: o They cannot follow a ‘one size fits all’ approach. The social media component of any communication strategy must be customized to accommodate cultural differences o International marketers must continually monitor local news concerning their firm’s product offerings and brands, to gauge the impact of local events (which can become global in some cases) on overall strategy  The classification scheme consists of three broad forms of cultural values o Other-oriented values reflect a society’s view of the appropriate relationships between individuals and groups within that society o Environment-oriented values prescribe a society’s relationship to its economic, technical, and physical environments o Self-oriented values reflect the objectives and approaches to life that the individual members of society find desirable 59 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428  Although most of the values are presented as dichotomies (materialistic vs non-materialistic), this is not meant to represent an either/or situation. Rather a continuum exists between the two extremes Australasian values  Other oriented values: o Historically, since the European settlement, Australia and New Zealand have been relatively individualistic, competitive, somewhat romantic, masculine, youthful and parent oriented societies o Traditionally, age was valued highly in almost all cultures. Older people are seen as wise and knowledgeable but this was less true in Australasia, because characteristics such as physical 60 Downloaded by Jennifer Chen ([email protected])  lOMoARcPSD|46450428 strength, stamina, youthful vigour and imagination were required to transform these ‘wilderness’ into developed nations o Older citizens have now developed political and economical clout and are beginning to use it  Environment-oriented values o Australasians have traditionally admired cleanliness, performance, risk taking and the conquest of nature. o Our risk-taking orientation seems to have changed somewhat over time. despite world war 2 and Depression, risk taking remains highly valued and appears to be regaining appreciation as entrepreneurs, smaller firms and self-employment.  Self-oriented values o Australasians are hardworkers. Low percentages of unemployments o People are aware of the harm of dangerous goods sich as tobacco, alcohol and other drugs Cross cultural variation  Ethnocentrism – the belief that our culture and its products are superior and that other cultures have or should have the same values as we do  61 Downloaded by Jennifer Chen ([email protected])