Consumer Behavior:

PERCEPTION

Name and last name:

Visit one of the supermarkets (e.g., Spar, Mercator) and observe how bottled
water is positioned on the shelves. Where do you find the store brand and where
the most expensive brand? What are the reasons that guide this positioning?
Use up to 400 words to answer this task.
Product positioning

How the general consumer think and act when enters the shop
While positioning begins with a product, the concept is really about
positioning the product in the mind of the customer
Easier way of getting into someones mind is to be first
The customer is bombarded with the continuous stream of advertising.
Consumers mind react to high volume of advertising by accepting only what
is consistent with prior knowledge or experience.

VAZNO:

Shelf space is an important resource for the retailers.

Retailers want to effectively allocate shelf space to its brands.
Retailer places both types of brands in the shelf e.g. private and national.
Allocation of shelf space is critical task for the retailer.
Retailer places private labels in the shelves for gaining higher margins.
While the purpose of placing national brand is to enhance the brand image of
PL, and store.
Retailer places PL near the national brands so that customers perceive it of high
quality.
Retailer allocates more shelf space to private as compared to national brand.
Results reveal that about 20% shelf is more allocated to private brands in
comparison to national brands.
Enhances the performance and total sales of a retail outlet.
Shelf space allowances by the manufacturer increase NB space on shelf.
PLs are place in shelf disproportion to their sales.
If assortment and advertisement of national brand is greater than the PL, then
NBs are allocated more space.
Image building, private label shelf space and bargaining power are the factors
which influence the shelf space decision.
PL is substitute of national brand and gives more revenue to the retailer.
Most of the customers prefer national brand. Market trends show that national
brand will expand in future.

Some of the visual placement techniques retailers use to capture on consumer

behavior includes:
Block placement items that are related to one another are placed together
Vertical placement merchandise being displaced on more than one shelf level
Commercial placement items with higher perceived value are given more
desirable positioning, while items that dont add much to the bottom line are
given less desirable space

Margin product positioning the more profit an industrial item gives the retailer
the better position it will receive
Market share placement the higher revenue generators are placed in shelves
that consumers can easily find them

Shelf space is a very important asset of the retailer. Shelf space is used by retailers for
multiple purpose e.g. placing products, enhancing displays, visibility, making
comparison easy among the products etc. Shelf space allocation decision to private &
national brands is largely influenced by multiple factors.
Retailer wants to give more shelves to private brands, while the manufacturer also
wants the proper shelf. If retailer does not give the appropriate shelf space to national
brand then it does not give the too good image of retailer. The reason is that,
customers are more aware of national brands, if they do not see national brands in the
retail outlet, and then customers perceive the retailer is of low quality
Factor analysis is statistical method used to reduce the data by extracting the
unobserved, uncorrelated variables from the observed and correlated variables. In
this, all the related variables are put under the common factor. Three factors are
extracted like image building, private label shelf space and retailers bargaining power
which show 68% variation. These factors have impact on the retailers shelf space
decision. Among all other variables price, promotion and market share are more
significant for shelf space decision. Significant relationship is found between city,
image building, private label shelf space and retailers bargaining power. While the
retail experience has not any association with these factors. Retail category has shown
association just with image building.
The factors include variables as
Image building (Price and promotion, demand, visibility, brand awareness,
advertisement)
Private label shelf space (Market share, quality, features, assortment)
Retailers bargaining power (Shelf space allowances, variety, in stock
availability).
Different factors for placing of private label or national brand
When there is number of National brands then the profits are high.
More shelf space is allocated to the brands either Private brand or National
brand with the high in stock availability.
Bargaining power of retailers increases with the introduction of private label.
Demand for the products increases when more shelf space is allocated.
When the price competition between Private and National is high, then profit
raises.
More shelf space is allocated to the National brands with the high brand image.
Shelf space allowances to the retailer increases the shelf space to the National
brands.
Brand awareness of National brands is higher than Private brands.
Less shelf space is allocated to the National brands when the private brands are
of high quality.
Greater the features in National brands, lesser the shelf space is allocate to
Private brands.
Private brands are placed in shelves disproportion to sales.
More shelf space is allocated to the brand either Private or National with the
high advertising.

The greater the prices gap between store brand and national brands, the lower
the space occupied by store brand on the shelves.
Visibility of brands can be increased through giving more shelf space
The greater the number of promotions of National brand, the lower the space
occupied by store brands on the shelves
Placement of Private label near National brand, increases the profit for the
retailers.
The greater the depth of assortment (number of product variants) of National
brand, the lower the space occupied by Private brands on the shelves.
When the Private brands are of low quality then, they are position close to
National brands
Less shelf space is allocated to Private brand due to its low price.
Private brands are sold at less prices than National brands because of low
quality
The lower the store brand market share in the category, the lower the space
occupied by store brand on the shelves.
Price and promotion has no impact on the shelf space allocation of private and
national brands

Vazno:
Profits for the retailers increase when PL is placed near the NB.
When the PLs market share is low then they are given less space.
Retailers bargaining power increases when he introduces the PL.
Disagree that, price and promotion has no impact on shelf space decision.
PL is sold at low price, because they have low quality.
Shelf space allowances by manufacturer to retailer, increase the space for
national brands.
Respondents perceive PL as a substitute of NB.
Customers prefer national brand over the private brand.
Due to shelf space performance and total sales increase.
National brand will expand in future.
Regression & Correlation
Image building and private label shelf space synergize each other. Private label shelf
space and image building Marjory contribute to shelf space. While private label shelf
space and bargaining power are negatively related. Image building, private label shelf
space and bargaining power are positively related to overall index.

Sensation and perception

Sensation is the immediate response of our sensory receptors (eyes, ears, nose,
mouth, and fingers) to basic stimuli (light, color, sound, odor, and texture).
Perception is the process by which sensations are selected, organized, and
interpreted.

Hedonic Consumption
Hedonic consumption: multisensory, fantasy, and emotional aspects of
consumers interactions with products
Marketers use impact of sensations on consumers product experiences
Vision

Color provokes emotion

Reactions to color are biological and cultural
Color in the United States is becoming brighter and more complex
Trade dress: colors associated with specific companies

Sound affects peoples feelings and behaviors

Phonemes: individual sounds that might be more or less preferred by
consumers
Example: i brands are lighter than a brands
Muzak uses sound and music to create mood
High tempo = more stimulation
Slower tempo = more relaxing
Touch
Haptic sensesor touchis the most basic of senses; we learn this before
vision and smell
Haptic senses affect product experience and judgment
Kinsei engineering is a Japanese philosophy that translates customers feelings
into design elements
Taste
Flavor houses develop new concoctions for consumer palates

Cultural changes determine desirable tastes

The more respect we have for ethnic dishes, the more spicy food we desire

Exposure
Exposure occurs when a stimulus comes within range of someones sensory
receptors

We can concentrate, ignore, or completely miss stimuli

Cadillacs 5 second ad

Differential Threshold
The ability of a sensory system to detect changes or differences between two
stimuli
Minimum difference between two stimuli is the j.n.d. (just noticeable difference)
Example: packaging updates must be subtle enough over time to keep current
customers
Subliminal Perception
Subliminal perception occurs when stimulus is below the level of the consumers
awareness.

Rumors of subliminal advertising are rampantthough theres little proof that it

occurs.

Most researchers believe that subliminal techniques are not of much use in
marketing.

Attention
Attention is the extent to which processing activity is devoted to a particular
stimulus

Consumers are often in a state of sensory overload

Marketers need to break through the clutter

Stimulus Organization
Gestalt: the whole is greater than the sum of its parts
Closure: people perceive an incomplete picture as complete
Similarity: consumers group together objects that share similar physical
characteristics
Figure-ground: one part of the stimulus will dominate (the figure) while the other
parts recede into the background (ground)
Semiotics
Semiotics: correspondence between signs and symbols and their role in the
assignment of meaning
Marketing messages have three basic components:
Object: product that is the focus of the message
Sign: sensory image that represents the intended meanings of the object
Interpretant: meaning derived
Perceptual Positioning
Brand perceptions = functional attributes + symbolic attributes

Perceptual map: map of where brands are perceived in consumers minds

Used to determine how brands are currently perceived to determine future
positioning

Positioning Strategy
Examples of brand positioning
Lifestyle
Price
leadership
Attributes
Product
class
Competitors
Occasions
Users
Quality

Grey Poupon is high class

Southwest Airlines is no frills
Bounty is quicker picker upper
Mazda Miata is sporty convertible
Northwestern Insurance is the quiet company
Wrigleys gum used when smoking not permitted
Levis Dockers targeted to men in 20s and 30s
At Ford, Quality is Job 1