Adman Lecture 4


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Perspectives on Consumer Behavior

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Adman Lecture 4

  1. 1. Advertising Management Lecture 4: Perspectives on Consumer Behavior
  2. 2. Consumer Behavior <ul><li>How people think about, buy, and use products as a response to MC messages </li></ul>
  3. 3. Consumer Response <ul><li>Prospects (t hose who have not bought the brand but who might be interested in it) vs. Current Customers (t hose who have purchased the brand at least once within a designated period. ) </li></ul><ul><li>Consumers (b uy for their own personal or household use) vs. Business Buyers (b uy on behalf of their organization) </li></ul>
  4. 4. All Consumers Are Human Affected By: Sociocultural Factors Social Class Reference Groups
  5. 5. Factors that Affect Decision-Making <ul><li>Socio-cultural factors </li></ul><ul><ul><li>Culture: group values based on traditions and distinctive history </li></ul></ul><ul><ul><li>Society: a group of people who live together and organize their lives as a community </li></ul></ul><ul><ul><li>Social class: a ranking of people in a society by factors such as family history, occupation, education and income. </li></ul></ul>
  6. 6. Factors that Affect Decision-Making (Social class) Poor, unemployed Lower The “working poor”, who perform unskilled labor and menial work for minimal wages Upper lower Lower-middle class or blue-collar workers who earn an average pay Working class Professionals, small-business owners, corporate managers with comfortable incomes Middle Professionals & businesspeople who have achieved financial success Upper (2% of pop) The highest class, “old rich”, well-known families Upper, upper (1% of pop)
  7. 7. Reference groups <ul><li>Associations and organizations with which people identify or to which they belong and which influence their attitudes and behaviors. </li></ul>
  8. 8. Reference Group Categories Counterculture, gangs, antisocial people Disassociative Famous Entertainers, athletes, politicians Aspirational Opinion leaders, consultant, leading professionals Experts Clubs, churches, schools Membership Family, friends, co-workers Personal
  9. 9. Factors that Affect Decision-Making <ul><li>Personal Factors </li></ul><ul><ul><li>Needs and wants: biological and psychological motivations that drive actions. </li></ul></ul><ul><ul><li>Attitudes, Opinions, Beliefs </li></ul></ul><ul><ul><ul><li>Attitude: general disposition or orientation toward objects, people and ideas usually accompanied by negative or positive judgments </li></ul></ul></ul><ul><ul><ul><li>Opinion: a specific judgment that is emotionally neutral </li></ul></ul></ul><ul><ul><ul><li>Belief: a thought or idea based on knowledge </li></ul></ul></ul>
  10. 10. Maslow’s Hierarchy of Needs Marketing & IMC Implications Needs Survival necessities, utilities, medicines, basic food products Physiological: water, sleep, food, shelter Insurance, alarm systems, cavity protection, retirement, investments Safety: security, shelter, protection, order, discipline Lifestyle products, clothing, grooming aids, restaurants, and clubs Belongingness: love, friendship, acceptance Status appeal of cars, furniture, upscale electronics, country clubs, liquor, first class Esteem: prestige, status, accomplishment, respect, recognition Promote the enriching experience of travel, education, hobbies Self-actualization: self-fulfillment, creative expression
  11. 11. How Brand Decision Makers Respond to MC Messages <ul><li>Hierarchy of Effects models: descriptions of a series of stages of response that brand decision makers move through </li></ul><ul><ul><li>AIDA sequence (Attention, Interest, Desire, Action) </li></ul></ul>
  12. 12. How Brand Decision Makers Respond to MC Messages… Cont’d <ul><li>Think/Feel/Do Models </li></ul><ul><ul><li>Levels of involvement </li></ul></ul><ul><ul><ul><li>Low-involvement products-products that are relatively cheap and bought frequently without much consideration and are perceived as low risk. </li></ul></ul></ul><ul><ul><ul><li>High-involvement products-products for which people perceive differences among brands and are willing to invest pre-purchase decision-making energy. </li></ul></ul></ul>
  13. 13. How Brand Decision Makers Respond to MC Messages… Cont’d <ul><li>Think/Feel/Do Models </li></ul><ul><ul><li>Relevance- the extent to which a product or its message is pertinent and connects with a customer’s personal interests </li></ul></ul><ul><ul><li>Risks </li></ul></ul><ul><ul><ul><li>Financial </li></ul></ul></ul><ul><ul><ul><li>Performance </li></ul></ul></ul><ul><ul><ul><li>Physical </li></ul></ul></ul><ul><ul><ul><li>Psychological </li></ul></ul></ul><ul><ul><ul><li>Social </li></ul></ul></ul>
  14. 14. Think/Feel/Do Response Wheel <ul><li>THINK: </li></ul><ul><li>Problem recognition </li></ul><ul><li>info search </li></ul><ul><li>evaluation </li></ul><ul><li>FEEL: </li></ul><ul><li>Attitudes </li></ul><ul><li>Liking </li></ul><ul><li>Preferences </li></ul><ul><li>Conviction </li></ul><ul><li>Satisfaction </li></ul><ul><li>DO: </li></ul><ul><li>Try </li></ul><ul><li>Buy </li></ul><ul><li>Other action response </li></ul><ul><li>Repurchase </li></ul>BRAND DECISION PROCESS THINK FEEL DO
  15. 15. Elaboration Likelihood Model <ul><li>Persuasion model based on involvement </li></ul><ul><li>Elaboration: degree to which a customer thinks about a message and relate the information to their own lives as they make purchase decisions. </li></ul>
  16. 16. Elaboration Likelihood Model Peripheral route process is based on such message factors as imagery, emotions, associations, celebrity spokespeople & music which creates interest in a message even if there is little interest in the product itself. Peripheral Route Central Route BRAND DECISION High involvement: cognitive analysis of brand features and benefits Low involvement: Emotional analysis of situation & feelings
  17. 17. How Brand Decision Making Works Problems And Opportunities Post- Purchase Evaluation and learning Cognitive Path (central processing) Emotional Path (peripheral processing) Habit/Repeat Path Search for Information Evaluate Choices Evaluate feelings and experiences Habit and loyalty Purchase or take some other action Step 1 Step 2 Evaluation of Brand Alternatives Step 3 Step 4
  18. 18. How Brand Decision Making Works... Cont’d <ul><li>Step 1: Recognizing a Problem or an Opportunity </li></ul><ul><li>Step 2: Evaluating Brand Alternatives </li></ul><ul><ul><li>Awareness-getting a message past the senses-the point of initial exposure-and into consciousness, </li></ul></ul><ul><ul><li>Brand knowledge-understanding of a brand and its benefits. </li></ul></ul>
  19. 19. How Brand Decision Making Works... Cont’d <ul><li>Step 2: Evaluating Brand Alternatives </li></ul><ul><ul><li>Two levels of brand awareness </li></ul></ul><ul><ul><ul><li>Recognition: identifying something and remembering that you saw or heard it earlier </li></ul></ul></ul><ul><ul><ul><li>Recall: higher level of awareness, bringing something back from memory </li></ul></ul></ul><ul><ul><li>Evoked sets: a group of brands that comes to mind when a person thinks of a product category because the person has judged these brands to be acceptable. (Ex: Snacks: Indirect competition (nuts, cookies, chips, fruit, popcorn, candy), direct (nuts: almond, cashews, walnuts, peanuts) </li></ul></ul>
  20. 20. How Brand Decision Making Works... Cont’d <ul><li>Step 3: Deciding what action to take </li></ul>
  21. 21. Three paths to a brand decision B2B supplies, routine purchases, repeat purchases leading to brand loyalty Do / think /feel Habit/repeat processing Snacks, beverages, cigarettes, small household items / Restaurants, sporting events, trade shows, new products where sampling & demo are impt. Do / feel / think and Feel / do / think Experiential processing; impulse, experiences Car, major appliances, high-involvement and new products Think / feel / do Cognitive processing Products Route Type of decision making
  22. 22. How Brand Decision Making Works... Cont’d <ul><li>Step 4: Evaluating the Purchase decision or other action </li></ul><ul><ul><li>Learning-a change in what a person knows that comes from exposure to new information or experiences. </li></ul></ul><ul><ul><li>Cognitive learning theory-a view of learning as a mental process involving thinking, reasoning, and understanding. </li></ul></ul><ul><ul><li>Conditioned learning theory-a view of learning as a trial-and-error process. </li></ul></ul>
  23. 23. How MC Messages Influence Consumer Decisions <ul><li>Persuasion-the act of creating changes in attitudes and behaviors. </li></ul><ul><ul><li>Attitude formation & attitude change </li></ul></ul><ul><ul><ul><li>Direction: whether the feeling is positive or negative </li></ul></ul></ul><ul><ul><ul><li>Degree of conviction: how sure customers are about their attitudes, how strong their feelings are </li></ul></ul></ul><ul><ul><li>Brand likability </li></ul></ul><ul><ul><li>Credibility and trust </li></ul></ul><ul><ul><li>Believable arguments and reasons </li></ul></ul>