McS 2600 Midterm Notes

Quiz #1

Motivation, Ability, and Opportunity

A case: bottled water

• What motivates some people to drink bottled water?

• Fears about the quality of tap water

• E.g., a 1993 outbreak of waterborne disease in Milwaukee

• Some consumers are motivated to project a certain image of themselves to other people

• “affluent- me”
• “healthy- me”

Motivation

• Definitions

• The drive to satisfy physiological and psychological needs through product purchases and consumption
• An inner state of arousal that is directed to achieving a goal

Consumer Motivation and its Effects

• High motivation

• Willingness to engage in goal-relevant activities

• Pay close attention to the goal
• Think carefully about info
• Attempt to understand or comprehend info
• Evaluate info critically
• Try to remember the information so that it can be retrieved later

Involvement

• Definitions

• The level of perceived importance and/ or interest evoked by a stimulus within a specific situation
• The level of motivation to process marketing information

A scale to measure involvement

[pic 1]

Involvement (Cont.)

• Types of involvement

• Enduring (intrinsic) involvement

• Interest in an offering for a long period of time

• Situational involvement

• Temporary interest in an offering, caused by situational circumstances

• Cognitive involvement

• Interest in thinking about information on offerings

• Affective involvement

• Tendency to become emotional about offerings

• Objects of involvement

• Involvement with Product Categories
• Involvement with Brands (Brand loyalty)
• Involvement with Ads
• Involvement with a Medium or a Program
• Involvement with Decisions and Behaviors (Response involvement)
• Therefore, we need to specify the object of involvement

What Affects Motivation?

[pic 2]

Personal Relevance

• Definition

• The extent to which something has a direct bearing on the self and has significant consequences or implications on one’s life
• Leads to highly effortful information processing and decision making

Values, Goals, and Needs

• Offerings and activities that are consistent with one’s values, goals, and needs are motivating
• Values

• Beliefs on what is good and important for you
• Source: genetics, culture, parents, and other environmental factors
• More likely to affect product category adoption decisions than..

Rokeach Value Survey

[pic 3]

A short survey of values [pic 4]

List of Values (LOV)

• A survey that asks consumers to rank nine principle values

• Self respect
• Sense of accomplishment
• Fun and enjoyment in life
• Sense of belonging
• Security
• Warm relationships with others
• Excitement
• Being well respected

• Why is the LOV useful?

• It predicts consumers’ actual consumption behaviors
• It identifies segments of consumers with similar value systems

Means-end chain[pic 5]

• Means-end chain

• Product attributes as a means to attain values
• Identifying the links between product features, benefits, and ultimately consumers values
• “laddering” technique

Example: John

• “because it is red”

• Features

• “because the red car is more likely to be noticed”

• Benefits [pic 6]

• “because it makes me feel good about myself”

• Values

Example: Mary [pic 7]

• “because it is red”

• Features

• “because the red care is more likely to be noticed”

• Benefits

• “because other drivers can see my car better, and I am less likely to be in the car accident”

• Values

Examples of Means-end Chains

[pic 8]

Goals

• A goal is defined as a mental image or representation associated with affect toward which action may be directed
• Goal setting

• The decision to pursue a given goal is a function of the desirability of the goal to the individual and the feasibility of goal attainment

• A goal hierarchy

• A structure of three level of goals
• Subordinate goals: how the focal goal is to be attained
• Superordinate: why the chosen course of action is pursued in the first place)

A goal hierarchy for losing weight

[pic 9]

Needs

• Needs

• An equilibrium level which is an ideal physical or psychological state
• Any departure from this equilibrium produces tension and arousal, which motivates fulfilling the needs (Homeostasis)

• Utilitarian needs

• Achieves some functional or practical benefit

• Hedonic needs

• Involves experiences, emotional responses or fantasies

• Symbolic needs

• How we perceive ourselves and how we are perceived by others

Categorizing Needs

[pic 10]

Characteristics of Needs

• Dynamic

• Satisfaction of needs is only temporary

• Hierarchical

• At a given moment, we assign more importance to some needs than others

• Can be aroused be external cues as well

Maslow’s Hierarchy of Needs [pic 11]

Criticism of Maslow’s Hierarchy

• Is this hierarchy universal?

• People sometimes ignore lower-order needs in pursuit of higher-order needs
• Cultural differences

• The intensity of needs

• Motivation at a given moment is affected more by the intensity of needs than by the existence of needs

Conflict of Needs

• Approach-avoidance conflict

• A given behavior satisfies some needs but fails to satisfy others

• Approach-approach conflict

• Tension due to a choice between two or more equally desirable options that fulfill different needs
• Theory of cognitive dissonance

• Avoidance- avoidance conflict

• Tension due to a choice between two or more equally undesirable options that fails to fulfill different needs

How to identify needs

• Interviews

• Conscious access of needs; Ability to articulate needs

• Observation of behaviors

• Requires subjective inference

• The same need can be exhibited in many behaviors
• The same behavior can reflect various needs

• Projective techniques

• Storytelling with cartoons and pictures
• Word associations, filling incomplete sentences or stories

• E.g., “Teenagers who smoke are ___.”

Thematic Apperception Test

[pic 12]

Perceived Risk

• Definition

• The extent to which the consumer is uncertain about the consequences of buying, using, or disposing of an offering

• Perceived risk is high when

• Little info about the offering is available
• Substantial quality difference exist between brands
• The offering is new or technologically complex
• The consumer has little experience in evaluating the offering
• The purchase is likely to be judged by others

Types of Perceived Risk

• Performance risk

• Uncertainty about whether the offering will perform as expected

• Financial risk

• Risk associated with monetary investment in an offering

• Physical risk

• The potential harm that an offering can cause to a consumers safety

• Social risk

• Potential harm to ones social standing that may arise from buying, using, or disposing of an offering

• Psychological risk

• Concern about the extent to which an offering is consistent with consumers perceived selves

• Time risk

• Uncertainties over the length of time consumers must invest in buying, using, or disposing of the offering

Reducing Perceived Risk

• Outcomes of perceived risk

• High risk poses psychological discomfort, which consumers are motivated to reduce

• Collecting additional information
• Compare the offering with alternative options
• Consulting friends or experts
• Buying the same brand as last time
• Using heuristics

Inconsistency with Attitudes

• Consumers are highly motivated to process information that is moderately inconsistent with existing attitudes

• Feeling of mild discomfort and/or threat
• High inconsistence with existing attitudes leads to…

• Defensive processing and counterarguments

Consumer Ability

• Definition

• The extent to which consumers have the resources necessary to understand the information thoroughly

• Source of ability

• Product Knowledge and Experience

• Sources: prior product usage, exposure to ads, interaction with salespeople, word of mouth, etc

• Cognitive Style

• Preference for the presentation format of information (i.e., visual vs. verbal)

• Intelligence, Education, and Age
• Money

Consumer Opportunity

• Lack of time or time-pressure

• Leads to limited/biased information processing
• Marketers must reduce purchase time

• Distraction

• Factors that divert consumers attention away from the message

• Amount of information
• Complexity of information
• Repetition of information

• Optimal repetition provides more chance to think about and scrutinize the information

Personality & Self concepts in CB

Personality

• Definition

• Inner psychological characteristics that determine and reflect how a person responds to the environment

• Characteristics

• Personality reflects individual differences
• Personality is consistent and enduring
• Personality can change

Freudian Personality Theory

• Unconscious needs and drives

• Sexual and biological drives and instincts

• Three interacting systems

• ID: meeting basic needs
• Superego: adding morals
• Ego: dealing with reality

Neo-Freudian Personality Theory

• Premise

• Social relationships are fundamental to the formation of personality

• Horney’s CAD Theory

• Compliant
• Aggressive
• Detached

Neo-Freudian Personality Theory (Cont’d)

• Horney’s CAD

• Compliant

• Moving toward others
• Interdependent, brand-loyal

• Aggressive

• Moving against others
• Preference to masculine appeal

• Detached

• Moving “from” others
• Independent, less brand loyal, variety-seeking

Cognitive Theories of Personality

• Premise

• People differ in how they process information

• Need for Cognition

• Predilection for thinking
• High NFC individuals

• More responsive to verbal, product-related information
• Spend more time processing print ads and remember ad claims better
• Are less affected by message framing

• Visualizers vs. Verbalizers

Need for Cognition Scale

[pic 13]

Trait Theories of Personality

• Premise

• Quantitative measurement of personality in terms of traits

• Multiple trait theories

• Big Five Theory

• Extroversion: People who are high in extroversion are outgoing and tend to gain energy in social situations.
• Instability: Individuals who are high in this trait tend to experience mood swings, anxiety, moodiness, irritability and sadness
• Agreeableness: People who are high in agreeableness tend to be more cooperative
• Openness to experiences: This trait features characteristics such as imagination and insight, and those high in this trait also tend to have a broad range of interests.
• Conscientiousness: Standard features of this dimension include high levels of thoughtfulness, with good impulse control and goal-directed behaviors.

[pic 14]

Trait Theories of Personality

• Need for uniqueness

• Desire to be different from others
• High NFU: willing to try innovations

• Optimal stimulation level

• High OSL: willing to take risks, try new products, seek variety

• Sensation seeking

• Need for varied, novel, and complex sensations
• High SS: engage in reckless behavior

• Consumer innovativeness

• Tend to try new products earlier than others

Quiz #2

Lecture 2 Cont’d

Marketing-specific Traits

• Consumer materialism

• The importance ascribed to the ownership and acquisition of material goods in achieving major life goals or desired states
• Gauges the extent to which an individual is preoccupied with purchasing and showeing off physical passions that are mostly nonessential and often conspicuous luxury goods

• Success factor

• The things I own say a lot of how well I’m doing in life
• I like to own things that impress people

• Centrality factor

• I like a lot of luxury in my life
• I try to keep my life simple, as far as possessions are concerned (reverse)

• Happiness factor

• My life would be better if I owned certain things I don’t have

• Buying impulsiveness

• A consumers tendency to buy spontaneously, unreflectively, immediately, and kinetically

• I often buy things spontaneously
• “just do it” describes the way I buy things
• “buy now, think about it later” describes me
• Sometimes I feel like buying things in the spur of the moment
• I carefully plan most of my purchase (reverse)

• Fixed consumption

• Passion for an interest in the category of what they collect
• Spending time and money into searching and building collections

• Compulsive consumption

• Addictive and uncontrolled buying or consumption with damaging consequences to oneself

• E.g. compulsive buying, problem gambling, alcohol addiction, eating disorder, etc.

Compulsive Buying Scale

• If I have any money left at the end of the pay period, I just have to spend it
• Felt others would be horrified if they knew of my spending habits
• Wrote a check when I knew I didn’t have enough money in the bank to cover it
• Bought myself something in order to make myself feel better
• Felt anxious or nervous on days I didn’t go shopping
• Made only the minimum payments on my credit cards

Brand Personality

• Brand personification

• Ascription of human personality traits to brand
• If _____ were a person, what kind of person would it be?

• Mr. coffee
• M&M
• Heineken
• Budweiser

Dimensions of Brand Personality

[pic 15]

Self-image

• Represents the way a person views her or himself
• Multiple selves

• Actual self: is the way the consumers see themselves
• Ideal self: is how consumers would like to see themselves
• Ought-to self: how consumers would like others to see them

• Brand-self image congruity

• Consumers tend to choose brand whose image is congruent with one of their self-image(s)

Extended self

• Definition

• Possessions are considered extensions of a consumer’s self
• Self becomes emotionally or symbolically attached to material possessions

• Utilitarian or problem solving
• Symbolic abilities and/or power: by making the person feel better
• Conferring social status: being an art collector and owning a rare masterpiece
• Feelings of immortality: leaving valuable bequests after death

[pic 16]

Self-image and Marketing

• Use self-concept for segmentation and positioning purpose
• Use actual and ideal/ought-to self concepts to promote brands
• Promote brands as ways of extending self-image

Lecture 3

Exposure

• Definition

• A stimulus coming within the range of a consumers sensory receptors
• Occurs when there is physical proximity to a stimulus that allows our senses to be activated

• Selective exposure

How Marketers Enhance Exposure

• Position an ad within a medium

• Commercial breaks
• Magazines
• Mediums that attract attention

• Product distribution and shelf placement

• Widespread distribution of brand
• The location or the amount of shelf space allocated to the product in retail stores
• Points in the store all consumers must go and spend time

Measuring Exposure

• Simmons data:

• What is the best media to expose consumers to an offering?

• The Nielson TV Index

• Exposure of ad
• People meter
• Who watches which program for how long?

• Traffic counters

• How many drivers/cars are exposed to this billboard
• PBM media, print measurement bureau

Limits of Perception

• Absolute Thresholds

• The minimum level of stimulus intensity needed to detect a stimulus (“absolute”)
• The stimulus must be sufficiently high in intensity to ___

• Subliminal Perception

• Unconscious activation of sensory receptors by a stimulus that is slightly below absolute threshold

• We are not aware of perceiving the stimulus even though our attention is directed to it
• Does subliminal stimuli affect brand choice?
• Kitchen detergent, participants exposed to scent, were more likely to clean

• Different Thresholds (J.N.D.)

• Intensity difference needed between two stimuli before the difference is perceived “relative”

• Reducing size of a candy bar, not able to see difference

• Weber’s Law

• The stronger the initial stimulus, the greater the additional intensity needed for the second stimulus to be perceived as different
• [pic 17]
• k is a constant provided for markets

How marketers utilize differential threshold

• When marketers do not want consumers to notice the difference,

• Make the change below differential threshold

• When marketers want consumers to notice the difference,

• Make the change above differential threshold

Attention

• Definition

• The extent to which processing activity is devoted to a stimulus
• The act of keeping one’s mind closely on something

• Characteristics of Attention

• Selective
• Dividable

• Can attend to multiple tasks as automatic well practiced and effortless

• Limited

Non-focal Attention

• Pre-attentive Processing

• Is it possible to attend to an object without awareness when we are focusing our attention to an adjacent object?
• Definition: the non-conscious processing of stimuli in peripheral vision

Hemispheric Lateralization

• The left hemisphere

• Counting, verbal processing, etc
• Processing things in the right visual field

• The right hemisphere

• Visual and spatial info, music, inferences and conclusion, etc.
• Processing things in the left visual field

• Therefore, pre-attentive processing is facilitated if

• Pictures in ads: to the left of an article
• Verbal info in ads: to the right of an article

Pre-attentive processing affects…

• Preference

• Pre-attentive processing breeds which increases preference

• Consumers like the brand name more if they processed it pre-attentively than if it has not been exposed at all

• Choice

• Consumers are more likely to consider choosing a product whose ad had been pre-attentively processed before

Ways to Enhance Attention

• Presenting personally relevant stimuli
• Presenting pleasant stimuli
• Presenting surprising stimuli
• Presenting easy-to-process stimuli
• Look for less cluttered environment

• Ambush marketing: placing ads in places where consumers do not expect to see them and cannot avoid them readily

Habituation

• Over-exposure

• When a stimulus becomes familiar, it loses people attention

• Advertising wear out

• Over-exposure of a commercial may lead to discomfort and negative attitude

• How to reduce habituation

• Alter the stimulus (commercials) often
• Used ads that differ in their executions but carry the same basic message
• Change the logo or packaging once in awhile

Related marketing concepts

• Ambush marketing

• Placing ads in places where consumers do not expect to see them and cannot readily avoid them

• Experimental marketing

• Facilitating consumer interaction with brands, products and services in sensory ways to create emotional bonds between consumers and marketing offerings

Perception

• The process whereby sensory stimulation is translated into organized experience
• Visual perception

• Brand logos; packaging; etc.
• Warm colors: arousing and exciting
• Cool colors: soothing and relaxing

• Auditory perception

• Auditory signature to create unique brand association
• Fast tempo: a more rapid traffic flow and turnover
• Slow tempo: a slower flow but encourages leisurely shopping

“Less marketed” perceptions

• Olfactory perception

• Odors can stir or calm mood and evoke memories
• Scent marketing

• E,g. cinnabon, grocery stores, used car dealers
• Singapore airlines, westin hotel

• Smell is processed by the limbic system

• Not under conscious control

• Tactile perception

• “touched” customers tip more
• Texture to touch, temperature

• Gustatory perception

• Nearly 80% of taste perception is derived from sense of smell

Perceptual Organization

• Gestalt psychology

• The process by which stimuli are organized into meaningful units
• A higher level of processing than simply registering stimuli on sensory receptors
• People derive meaning from the totality of a set of stimuli, not from individual stimulus

Organizational Principles

• The principle of figure and ground

• Stimuli are interpreted in the context of a background

• The principle of closure

• The tendency to fill in to incomplete stimuli so that they are perceived as meaningful

• The principle of grouping (similarity)

• A tendency to group together objects that share similar physical characteristics

Quiz #3

Lecture 4: Consumer learning and memory processes

Types of consumer learning

Cognitive learning

• Effortful, Evaluation of information to solve an unfulfilled need
• Starts from conscious recognition of problem
• Extensive learning of alternatives occur prior to purchase

Passive learning

• To simple ads via low involvement (e.g., TV commercials)
• “Mere exposure” effect produces familiarity and trial purchase
• Information processing and attitude information may happen after purchase

Types of consumer learning

Cognitive learning

• Knowledge (Awareness )→ Evaluation ( interest/desire  )→ Behaviour (Action)[pic 18]

Passive learning

• Affect(Familiarity )→ Behaviour (Trial)→ Evaluation (Satisfactory?)
• Consistent with classical conditioning

High-effort decision making        

• Hierarchy of effects

• Sequential steps used in DM

• High-effort hierarchy of effects

• Active learning leads to acquiring product beliefs
• Attitudes are formed based on product beliefs
• Choice reflects attitude toward the offering
• Traditional understanding of consumer choice: “motivated consumers,” “optimizing” [pic 19]

Low effort decision making

• Low-effort hierarchy of effects

• Incidental learning
• Constant repetition of ad messages leads consumers to pick up and retain messages passively without forming an attitude

• E.g., TV commercials

• Choice can be made in the absence of a strong attitude
• Satisficing (vs. “optimizing”)

Theories of consumer learning

• Classical conditioning
• Instrumental conditioning
• Observational learning

Classical conditioning

• How it works

• Repeatedly pair the target stimulus (CS: e.g., brand) with another stimulus that automatically evokes certain feelings and meanings (UCS)
• Repeated pairing facilitates a transfer of meanings and feelings from UCS to CS
• An mechanism of learning and affect transfer

• Pavolv’s experiment

• Dogs naturally salivate (UCR) upon seeing food (UCS)
• Repeatedly pair bell sound (CS) with food (UCS)
• After a while, dogs salivate (CR) at the bell sound (CS)
• Salivation has become bell sound

• Marketers’ perspective

• Repetition: repeatedly pair a brand with UCS that evokes a positive feeling
• After a while, the same feeling will be conditioned on the brand

• Stimulus generalization

• Conditioned on objects similar to the focal brand
• Marketers take easy ways

• Product line extensions

• Extend the brand name to a new item in a related product category

• Product form extensions

• Offer the same product in a different form (e.g., liquid gel)

• Family branding (a.k.a. brand extension)

• Extend the brand name to dissimilar product categories

• Licensing

• Lending the right to use a brand to another company

Which is which?

• V8 soup

• Product line extension

• Mr. clean: 2 new scents

• Product line extension

• Listerine: new pocketpacks

• Product line extension

• Campbell: frozen meals, tomato juice

• Family branding

• Calvin Klein belts, shoes, and scarves

• Brand licensing

Instrumental conditioning

• Definition

• Behavior can be facilitated by presenting or withdrawing reinforcements (or punishments) repeatedly
• Applies to learning of repeat purchase/ patronization

Contingencies of reinforcement