Consumer Behavior Exam 3

Why is Consumer Learning Important to Marketers?

• We want to teach consumers about the product attributes, where to buy it, how to use it.

• then we can analyze the effectiveness of our communication with our consumers

  • directly through advertising

  • indirectly through product appearance, packaging, price, and distribution channels

Learning

relatively permanent change in an organisms behavior due to experience

• some consumer learning is intentional - operant or observational

• much of consumer learning is incidental- classical

3 learning theories

classical

instrumental/operant

observational

classical conditioning applications:

stimulus generalization - learned associations can generalize to other things

• eg. family branding, look alikes

Stimulus discrimination- promote unique attributes

associative network

how is information stored?

• memories and info stored in nodes

• associative links of varying strengths connect the nodes

• when one node is active, this activation spreads (spreading activation) along associative links toward related concepts

• eg. small car=good gas milage =save money =can buy other things

delete

how many people in sample + why

30 , allows us to have statistical inference

what are two types of sampling procedures

probability and non probability

problems with surveys

• leading

• ambiguous

• unanswerable

• double barrled

• not mutually exclusive

How to identify opinion leaders

1) self-designating method

• ask individuals whether they consider themselves to be opinion leaders

• easy to apply to large group of potential opinion leaders

• inflation or unawareness of own importance/influence

2) key informant method- asking others

• key informants identify opinion leaders

3) sociometric analysis - trace communication patterns among group members

• systematic map of group interactions

• most precise method of identifying product-information sources, very difficult/expensive to implement

• referral behavior/network tie strength

• bridging function

scales

• semantic differential scale - polar opposites on a scale

• likert scale

Marketing Dashboard

Used to help display information in effective manner that is visually appealing

• identifies opportunity, threats, strengths

Intentional learning

learning that is acquired as a result of careful search for information

Incidental learning

learning acquired without effort or by accident

Behavioral learning theories

1) classical conditioning

2) operant/instrumental conditioning

• stimulus —> consumer —> response

Cognitive learning theories

1) Observational

Classical conditioning

Steps:

1) natural reaction: unconditioned stimulus is linked to unconditioned response

• food —> salvation

2) pairing: unconditioned stimulus is paired with neutral stimulus

• food + bell —> salivation

3) after learning: neutral stimulus becomes conditioned stimulus; produces conditioned response on its own

• bell —> salivation

behaviors are involuntary and not under conscious control of individual

instrumental/ operant conditioning

• use outcomes of behaviors to create positive or negative associations

• associate behavior with its consequences

• deliberate

Positive reinforcement

positive outcomes that strengthen the likelihood of a specific response

Negative reinforcement

unpleasant or negative outcomes that serve to encourage a specific behavior

Instrumental conditioning applications:

Reinforcement schedules:

• total reinforcement - reinforcement every time an event occurs

  • free drink after dinner with each meal

• fixed interval reinforcement - reinforcement after a certain amount of time

  • $5 off gas every Thursday at shell

• fixed ratio reinforcement - reinforcement after certain number of responses

  • every 6 meals you get a free one at teriyaki one

• variable ratio reinforcement - reinforcement after an unpredictable number of responses

  • slot machine, lottery

Classical vs. operant conditioning

• classical: behavior elicited by one stimulus will be elicited by a second stimulus if both stimuli occur together frequently

• operant: behavior that is given reinforcement is more Lilly to be repeated when he same situation arises in the future

Cognitive learning theory

• observational learning

• people are problem solvers actively using the information around them

steps:

1) attention- consumer focuses on a models behavior

2) retention- consumer retains this behavior in memory

3) production processes- consumer has ability to perform the behavior

4) motivation- a situation arises where in the behavior is useful to the consumer

5) observational learning- the consumer acquires and performs the behavior earlier demonstrated by model

Vicarious/observational learning

process by which people change their behaviors because they observe actions of other people and associated consequences

5 stages of consumer development

• children start accompanying parents to marketplace as early as one month

• begin to make independent purchases as early as 4 years old

• Stage 1: observing (1 month)

• stage 2: making requests (2 yrs)

• stage 3: making selections (4 yrs)

• stage 4: making assisted purchases (5 or 6)

• stage 5: making independent purchases (8 +)

Parental socialization styles

1) authoritative - warm, restrictive

• higher academics, more self-esteem, better social skills, less mental illness

2) authoritarian -hostile, restrictive

• lower academics, less self-esteem, poorer social skills, mental illness, delinquency

3) indulgent - warm, permissive

• impulsive, egocentric, poorer social skills, problematic relationships

4) neglecting - hostile, permissive

• impulsive, delinquency, drug or alcohol abuse, suicide

factors that influence retrieval of information

• age- biological decline

• self-reference effect - tendency to encode information differently depending on the level in which one is implicated in the information

  • when people asked to recall info when it is related in some way to themselves, recall rate can be improved

• state-dependent retrieval or mood congruency - your mood and mental state for the day

• familiarity- too little or too much hurts recall

• salience- stimuli that stand out

Memory

process of acquiring and storing information to use it later

contemporary approach to memory: information-processing model

• external inputs- stimuli

• encode- palce information in memory

• store-retain some of that information

• retrieve- recall

Consumer knowledge

• a subset of the total amount of information stored in memory that is relevant to product purchase and consumption

• information acquired through internal and external sources which attributes to consumer knowledge

how is consumer knowledge acquired, organized, and used?

• memory

• categorization

Components of Consumer Knowledge:

1) knowledge of products existence

2) knowledge of attributes and associations

3) purchase knowledge

4) consumption and usage knowledge

Categorization

• using prior information to classify or identify something new

• adding structure helps in managing high loads of information and allows the brain to reduce overall effort

• by putting stimuli into categories, consumers are able to decide how to behave in certain situations and what they can expect

  • eg. where would I expect to find this item in this store

3 types of categorization

1) constructed categories

• how do I clean the floor>? broom, vacuum cleaner, brush

2) formal categories - product types

• vacuum cleaners

3) consideration set - set of options from which you would choose one

• hoover, dyson, dirt devil

Graded Structure

• some category members (best example of a category) represent category better than other

  • prototype/exemplar (best example of a category)

  • more easily recalled

  • standard of comparison for category

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Memory Process

1) sensory memory- temporary storage of sensory information

• use attention to shift info to short-term memory

• attention- information that passes through an attentional gate is transferred to short-term memory

2) short-term memory- brief storage of information currently being used

• use elaborative rehearsal to commit information to long-term memory

• elaborative rehearsal- information subjected to elaborative rehearsal or deep processing

3) longterm memory- relatively permanent storage of information

Consumer knowledge from packaging

• communication benefits- usage instructions, dosage, how often to use, composition, warnings

• functional benefits- convenience protection, storage

• perceptual benefits- can imply status , economy, product quality

Nostalgia

• marketers may resurrect popular characters to evoke fond memories of the past

  • nostalgia

  • retro brand

how are products categorized

• put into preexisting category based on similarities between new product and category members

• create a new category (hybrid)

  • often a combination of two known categories

things that effect how we remember

• state dependent retrieval

• familiarity and recall

• salience

• viewing context

• pictorial vs. verbal cues

  • diagram (pictoral) vs rhyme (verbal cue)

Word of Mouth Communication

• what other consumers tell us about products (good and bad) is more influential than formal advertising

• WOM- product information transmitted by individuals to other individuals

  • more reliable form of marketing

  • social pressure to conform

  • influences two thirds of all sales

  • WOM relied on in later stages of product adoption

  • powerful in unfamiliar product categories

  • online social networking magnifies the impact of WOM communication

Opinion leaders

particularly likely to influence others’ product choice

• also known as mass connectors are empowered by online communities that result in powerful influence impressions that spread due to the momentum effect

Characteristics of opinion leader

• experts

• socially active

• among the first to buy

• unbiased evaluation

• similar to the consumer

Social media characteristics of online communities

• more users the better

• monetized based on number of users

• have a sense of cyberspace

• posts categorized by folksonomies

• constantly improving

Achieving a Flow State

• sense of playfulness

• sense of being in control

• highly focused attention

• mental enjoyment

• lost time

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• sociometric analysis- trace communication patterns among group members

  • systematic map of group interactions

  • most precise method of identifying product-information sources, very difficult/expensive to implement

  • referral behavior/network tie strength

  • bridging function

data

classified observations of behavior; your results

hypothesis

predicted relationship between variables

marketing research

• formal assembly and analysis of data about specific issues surrounding a marketing strategy

• link between marketing strategy and decisive marketing actions

Marketing research process

1) problem definition

2) research design

3) collect information

4) interpret and report findings

5) take action

Step 1: problem definition

• set research objectives

  • specify goals to accomplish

  • specify kind of research they want when setting research objectives

  • 3 types of marketing research: 1) exploratory 2) descriptive 3) causal

• Identify possible marketing actions

  • what are my measures of success

  • do different outcomes lead to different marketing actions

  • is the problem researchable

Research approaches

• personal interviews or surveys

• focus groups (min 6 ppl)

• mail/online/phone surveys

• observational data - facts and figures obtained by watching how people behave

• mechanical methods- mystery shopper

  • ethnographic research- observe consumers in natural habitat

• questionaries- include open-ended and closed-ended questions

  • phrasing and question order are key

Step 2: research design

• identify constraints (time,money)

• identify data

• determine data collection method

  • sampling

  • statistical inference

Samples

• subgroup of population from whom information will be collected

• sampling plan decisions:

  • population

  • sample size

  • sampling procedure

    • probability samples

    • non probability samples

Step 3: collect information

• primary and secondary

• internal and external

question formats

• open ended questions

• closed ended questions

• dichotomous questions - two options, yes no

• semantic differential questions

• likert scale questions

Experiments

• helps you avoid correlational research and isolate the cause of a change in behavior

• experiments require two main things:

  • researcher controls the IV

  • researcher “randomly assigns” participants to different versions of the IV

Step 4: interpret and report findings

• analyze the data

  • are we targeting the right customers?

  • are we meeting objectives?

  • customer relationship management (CMR)- offers benefits and can help firm gain competitive advantage

  • technology alone cannot build profitable customer relationships

• present the findings

  • marketing dashboard

  • distributing and using marketing information

  • routine reporting makes information available in timely manner

  • user friendly databases allow for special queries

  • intranets and extranets helps distribute information to company employees and value network members

Step 5: take action

• make recommendations

• implement action recommendations

• evaluate results

  • evaluate decision and process