Consumer Behavior – Chapter 2: Value & the Consumer Behavior Framework

These flashcards cover the key concepts from Chapter 2, including the Consumer Value Framework, types of value, marketing strategy, market segmentation, perceptual mapping, and customer lifetime value.

What does the Consumer Value Framework (CVF) illustrate?

The factors that shape consumption-related behaviors and ultimately determine the value associated with consumption.

Which component of the CVF reflects the strength of the bond between a consumer and a brand, retailer, or service provider?

Relationship quality.

What information system collects, maintains, and reports detailed customer data to enable a more customer-oriented approach?

Customer Relationship Management (CRM).

In the CVF, what must occur before a consumer can receive value from a product or service?

A consumption (decision-making) process.

Which two broad categories of factors influence the consumption process in the CVF?

Internal influences and external influences.

What term describes the thinking or mental processes by which consumers process and store information?

Cognition.

Feelings or emotions associated with objects and activities are known as what?

Affect.

How are ‘individual differences’ defined in consumer behavior?

Characteristic traits of people—such as demographics, personality, and lifestyle—that help determine their behavior.

What is the ‘zero moment of truth’ in external influences?

The moment when a shopper moves from passive to active and seeks out exchange alternatives.

Which external influence category addresses how other people shape consumer decisions, whether face-to-face or online?

Social environment.

What type of influence refers to factors unique to a time or place (e.g., store décor, weather, economic climate)?

Situational influences.

Provide the basic definition of value in consumer behavior.

A personal assessment of the net worth obtained from an activity.

According to the value equation, what two broad elements are weighed against each other?

‘What you get’ (benefits) versus ‘what you give’ (sacrifices such as money, time, effort, opportunity costs).

What type of value stems from a product helping solve a problem or accomplish a task?

Utilitarian value.

Which type of value is derived from the immediate gratification and emotions of the consumption experience itself?

Hedonic value.

Name a retailer mentioned in the lecture that primarily exemplifies utilitarian value.

Amazon.

Which streaming service was cited as primarily providing hedonic value?

Netflix.

Define marketing strategy in one sentence.

The way a company goes about creating value for customers.

What is marketing myopia?

The shortsighted view that a company is in a product business rather than a value- or benefits-producing business.

What are marketing tactics, and which four major decision areas do they cover?

Specific actions to implement strategy, covering product, price, promotion, and distribution.

In the total value concept, what does an ‘augmented product’ include?

The physical product plus any accompanying services (e.g., installation, warranties) needed to obtain benefits.

Explain value co-creation in one sentence.

The idea that both the marketer and the consumer actively contribute resources (knowledge, skills) to produce value.

What term captures consumers’ increasing tendency to seek value from immediacy and virtual connections rather than ownership?

Liquid consumption.

List the four elements of the marketing mix.

Product, price, promotion, and distribution (place).

Define target market.

The specific segment or segments of a market that a company chooses to serve.

What is market segmentation?

Separating a market into groups based on different demand curves (or value equations) associated with each group.

In market segmentation, what does ‘elasticity’ refer to?

The sensitivity of consumers to changes in a product characteristic such as price.

Describe ‘backward sloping demand.’

A situation in which higher prices lead to higher quantities demanded in a particular segment.

What is product differentiation?

A market condition in which consumers perceive competing products as different rather than identical.

Define product positioning.

The way a product is perceived by consumers relative to competing products.

What tool graphically depicts the positioning of competing products?

A perceptual map.

Which strategy positions a firm far from competitors, creating a new ‘space’ and isolating it for a time?

Blue ocean strategy.

On a perceptual map, what does an ‘ideal point’ represent?

The combination of product characteristics that provides the most value to a specific consumer or segment.

What is a strategy canvas?

A multi-dimensional perceptual mapping technique used to identify uncontested (blue-ocean) market space.

Provide the formula for Customer Lifetime Value (CLV) used in the lecture.

CLV = NPV (sales – costs) + NPV (equity).

Why do marketers focus on customers with high CLV?

Because not all customers are equally profitable; concentrating resources on high-CLV customers maximizes firm value.

Which CVF component directly addresses consumers’ knowledge and skills brought to the transaction, enabling value co-creation?

Internal influences (consumer psychology and abilities).

What common class discussion question probes whether social shopping influences buying behavior?

Do you find that shopping with friends or family affects your purchase decisions compared to shopping alone?

How does the lecture suggest Sears is positioned in terms of utilitarian and hedonic value?

Offering low levels of both utilitarian and hedonic value.

Give one example from the lecture of a brand that combines high utilitarian and hedonic value.

Trader Joe’s.