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Neural Correlates of Consumer behavior:
Bad News Management Effect Of Cause-related Marketing
Anna Jo1
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  1. 1. Printed by 웹 포 스 터 Neural Correlates of Consumer behavior: Bad News Management Effect Of Cause-related Marketing Anna Jo1 , Jiyoung Ryu1 , Jaesung Jeong1 1 Korea Advanced Institute of Science and Technology (KAIST), Daejeon, South Korea AbstractAbstract • Six pictures of logos of familiar multinational corporations in South Korea and product-related/social CM and product- related/CM-related/unrelated bad news were chosen for visual presentation(McDonald's, Adidas, Levi’s, Toyota, PepsiCo, Samsung). • The experiment used 5-point scale to assess corporate reputation and purchase intention, and a button box rested in the participant’s right hand. 20 healthy, right-handed subjects recruited from local communities.[M:F(13:7); mean age 25.7, range 22-30 years, SD:2.13] for behavioral study, then seven subjects participated in fMRI study[M:F(4:3); mean age 25.9, range 22-30, SD:3,2] • The subjects were responded the questions for six companies three times, respectively: before CM news headlines, after CM news headlines, and after negative corporate events. The control group were asked to evaluate the companies vice versa: before negative untold events, after negative untold events, and after CM news headlines. • Behavioral analysis using eye-tracking machine confirmed to observe of time on task as a measure of fMRI(1.5T Philips) study. • Cause-related marketing(CM) is the process of implementing marketing activities to contribute a specified amount to a designated cause based on a corporate social responsibility. • Recent studies have investigated the BOLD signal in ventral medial prefrontal cortex(VMPFC) and empathy-related insula activation correlated with the subjective value of voluntary donations. • Little is known about (1) why CM effectively attracts people to get good reputation and to promote purchase intention and (2) whether CM thwarts negative publicity in response to obvious business mismanagement(e.g. product-related/social mishaps). • In the present study, we empirically assessed the effects of CM on consumers’ attitude toward the 6 companies and demonstrated heightened activity in reward-related brain area. • To identify brain regions specifically involved in the CM effect versus business mismanagement, and vice versa, contrasts were computed. The BOLD activity in anterior insula and anterior cingulate cortices was shown to increase.(x=8, y=40, z=-2, p < 0.001) • The evoked activity in OFC reflecting motivation counteracting empathy was associated with letting altruistically punish moral hazard corporations.(x=-20, y=52, z=6, p < 0.001) • Proactive CM alleviates overall consumers' disappointment in reaction to corporate disasters by decreasing insular activity with whether emotionally aversive or not. • Anterior Cingulate Cortices are sensitive to the magnitude of loss/gain associated with the type of CM and Corporate misfortunes. • Further study should eliminate individual difference effectively and investigate the classification between corporate reputation and consumers’ purchase intention underlying neural mechanisms of social reward. Brain Dynamics Laboratory MethodsMethods ResultsResults ConclusionsConclusions Fig 1. Task time line for session I for fMRI study Fig 2. The averaged difference of corporate reputation(Q1) and purchase intention(Q2) between proactive CM(Group A) and reactive CM(Group B) from consumers’ perspective Fig 3. Brain responses for proactive CM : Reading CM news headlines – Reading negative corporate event. (a) conflict monitoring (b) altruistic punishment MethodsMethods Fig 1. Task time line describing CM context, and bad News for session 1 ResultsResults • Subjects’ ratings of corporate reputation and purchase intention were examined using categorized CM head lines and bad news. Judgments were not highly sensitive to the companies. • The directions of bad news management effect of CM on consumers were consistent with strategic corporate philanthropy classification on consumer perception of brand equity variable as identified by the 2x2 schema: two categories of philanthropic activity(directed vs. general) and strategic implementation(reactive vs. proactive).

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