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BUAD 307 MARKETING FUNDAMENTALS
Why does Staples sell Starbucks coffee?
Lars Perner, Instructor
Influences on and of Consumer Behavior
COMMUNICATION SOCIAL AND OTHER INFLUENCE
Lars Perner, Instructor
Learning Outcome Objectives Understand how consumer cognitive (thinking) processes and limitations. social influences. and other contextual factors influence consumer decision making. affect. and behavior Appreciate how these insights can be used to design and implement effective marketing strategies Appreciate individual and segment differences in process and outcome BUAD 307 CONSUMER BEHAVIOR Lars Perner. choices. Instructor 4 . beliefs.
you cannot smell it yourself. BUAD 307 CONSUMER BEHAVIOR Lars Perner. you do not need vitamin supplements. Bleach actually makes these stains worse. Using a razor with five blades will reduce the likelihood of cutting yourself and will result in less skin irritation. Dell Computers tend to be of higher quality than those made by HP and Sony. If you eat a balanced diet.True or False? 1. Instructor 5 . Rust stains on clothes can be removed with the use of lemon juice. 5. 4. 2. If you have bad breath. 3.
Instructor 6 . or software? BUAD 307 CONSUMER BEHAVIOR Lars Perner. chocolate.Questions Faced By Consumers Are veggie burgers actually healthy? What makeup should you use to get an ³even´ skin tone? Do I get any useful benefits from spending more than $125 on a digital camera? Should I get a ³make-over?´ What am I looking for? What should I do? Is my mechanic honest? Which tie should I wear for a job interview? Should I give my wife roses.
stress reduction <----.vacation..Consumer Problems and Recognition Consumer problem: Discrepancy between ideal and actual state--e..g. Instructor 7 . medication BUAD 307 CONSUMER BEHAVIOR Lars Perner. hot bath. movie.g. consumer: ± Has insufficient hair ± Is hungry ± Has run out of ink in his or her inkjet cartridge Problems can be solved in several ways--e.
Instructor 8 .CONSUMER DECISIONS: Theory and Reality in Consumer Buying PROBLEM RECOGNITION INFORMATION SEARCH EVALUATION OF ALTERNATIVES PURCHASE POSTPURCHASE EVALUATION/ BEHAVIORS BUAD 307 Theory Complications CONSUMER BEHAVIOR Lars Perner.
Instructor 9 . store visits. media.Approaches to Search for Problem Solutions INTERNAL Memory Thinking EXTERNAL Word of mouth. trial BUAD 307 CATALOG CONSUMER BEHAVIOR Lars Perner.
Instructor 10 .Options Identified and Considered UNIVERSAL SET All possible options RETRIEVED SET Options that readily come to mind EVOKED SET Options that will be considered by the consumer Note: Retrieved and evoked sets will vary among different consumers CONSUMER BEHAVIOR BUAD 307 Lars Perner.
External search is more likely for higher involvement products. efforts aimed at affecting internal search tend to be more effective²the consumer is usually not willing to expend energy on external search.REMINDER For low involvement products. BUAD 307 CONSUMER BEHAVIOR Lars Perner. Instructor 11 .
Instructor 12 .Decision Making Issues Involvement level ± Temporary ± Enduring Consumer locus of control ± Internal ± External Product category complexity Consumer knowledge BUAD 307 CONSUMER BEHAVIOR Lars Perner.
g. Instructor BUAD 307 LESS IMPORTANT 13 .. then compensatory tradeoffs on other attributes ± Abandoned strategy: Consumer finds initial criteria unrealistic and proceeds to less desirable solution CONSUMER BEHAVIOR Lars Perner.g.Evaluation Type IMPORTANT ± Compensatory: Decision based on overall value of alternatives (good attribute can outweigh bad ones) ± Non-compensatory: Absolutely must meet at least one important criterion (e. one non-compensatory measure.. car must have automatic transmission) ± Hybrid: Combination of the two (e.
buy that brand. buy Coke The larger the navels. Instructor 14 . otherwise.Heuristics²Low Involvement Decision Rules If either Coke or Pepsi is on sale. the better the orange The larger package is likely to offer a lower unit price (not true in reality) BUAD 307 CONSUMER BEHAVIOR Lars Perner.
Attitudes components BELIEFS AFFECT (FEELING) BEHAVIORAL INTENTIONS BUAD 307 CONSUMER BEHAVIOR Lars Perner. Instructor 15 .
disgust) BUAD 307 CONSUMER BEHAVIOR Lars Perner. or neutral ± May or may not be accurate ± May contradict other beliefs held by the other person Behavioral Intentions ± An individual¶s plan or expectations of what he or she will do ± May appear inconsistent with beliefs ± May not predict well what the individual will do in reality Affect ± May be positive or negative ± May take on specific dimension (e.. Instructor 16 . pleasure.g.Attitude Components Beliefs ± Can be positive. negative.
Instructor 17 .Generating Beliefs Through Advertising Statements must be ± Perceived ± Comprehended ± Remembered ± Believed (at least in part) BUAD 307 CONSUMER BEHAVIOR Lars Perner.
Always. Instructor 18 . Always low prices.Positioning Through Creating Beliefs ³It¶s not delivery. it¶s De Journo!´ ³Wal-Mart.´ ³I just saved a bunch of money on my auto insurance.´ ³U-um Good!´ (Campbell¶s Soup) BUAD 307 CONSUMER BEHAVIOR Lars Perner.
You should know conceptually what this involves conceptually²i. Instructor 19 ..Multiattribute Models of Attitude Attitude computed as a function of multiple attributes weighted for importance: Ab ! §i !1WiXib Ab= attitude toward brand b W i: weight of attribute I Xib: belief about brand b¶s performance on attribute I Model assumes rationality Calculations will not be required on the exam. weighing importance and intensity of feeling. BUAD 307 n CONSUMER BEHAVIOR Lars Perner.e.
± Some factors may be intangible²What are the substantive differences between Windows and Apple computers? ± Non-compensatory factors²³musthaves´²may determine final result. overall averages can be misleading. it is much ³easier´ to be extremely good or extremely bad.Multiattribute Models Caveats ± Different segments exist that will weight factors differently²thus. ± Prior research may be needed to identify issues (dimensions) to be weighted. Instructor 20 . Separate analyses should be done for different segments of interest. We are looking to work with what consumers believe. (Segments can be identified by certain statistical techniques). BUAD 307 Applications ± Determining Overall performance Areas of strength and weakness ± Comparison to competitors Overall Areas of strength and weakness REMINDER: PERCEPTIONS ARE NOT NECESSARILY ACCURATE. CONSUMER BEHAVIOR Lars Perner. ± Individual differences exist in scale intensity²for some.
Instructor 21 .Affect Based on ± past emotional associations of product ± emotional effect of beliefs BUAD 307 CONSUMER BEHAVIOR Lars Perner.
Instructor 22 .Attitude Characteristics Availability/ accessibility Constructed vs. natural Strength BUAD 307 CONSUMER BEHAVIOR Lars Perner.
Measurement of Attitude Components Beliefs ± Semantic Differential Scales ± Good -------------------Bad ± Fast --------------------Slow ± Reliable-----------------Unreliable Feelings ± Likert Scales (Strongly agree « Strongly Disagree) ± ³This product makes me happy.´ BUAD 307 CONSUMER BEHAVIOR Lars Perner. Instructor 23 .
Instructor 24 .Measurement Behavioral Intention ± Rating of likelihood of purchase ± May need projection if social desirability affects willingness to admit to product use BUAD 307 CONSUMER BEHAVIOR Lars Perner.
a car with a beautiful woman ± Attitude toward the ad A likable ad for a brand in a mundane product category² e. ± Energizer Bunny ± Snuggles (fabric softener) ± Mere exposure BUAD 307 CONSUMER BEHAVIOR Lars Perner..g.. Instructor 25 .Attitude Change Strategies.g. Part I Change Affect ± Classical conditioning ³Pairing´ the brand or product with desired stimulus²e.
g. Instructor 26 .Attitude Change Strategies II Change behavior (e...g. sampling) ± Attitudes are inferred from behavior (e. I buy the product I must like it or It must be good) Change Belief Component ± Change existing beliefs Difficult Advertiser¶s motives are suspect ± Change importance of attributes ± Add beliefs ± Change ideal (fashion) BUAD 307 CONSUMER BEHAVIOR Lars Perner.
Adding Beliefs (True or Not): Examples Brushing and flossing do not reach all areas of the mouth People under stress need more vitamins Baking soda will reduce odor of refrigerators Fragmented hard drives may cause computer errors BUAD 307 CONSUMER BEHAVIOR Lars Perner. Instructor 27 .
Instructor 28 .REMINDER Changing currently held beliefs tends to be difficult²people know the marketer has an ulterior motive Adding new beliefs that are not inconsistent with what is already believed may be more effective BUAD 307 CONSUMER BEHAVIOR Lars Perner.
Instructor 29 . two sided appeals One-sided: only saying what favors your side Two-sided: stating your case but also admitting points favoring the other side ± Why is this effective? BUAD 307 CONSUMER BEHAVIOR Lars Perner.One-sided vs.
Instructor 30 .Potential Family Life Cycle Stages YOUNG SINGLE YOUNG COUPLE EMPTY NEST I/II FULL NEST I/II/III SINGLE PARENT BLENDED BUAD 307 OLDER SINGLE CONSUMER BEHAVIOR Lars Perner.
Economic/Marketing Implications of Household Cycles Income tends to increase with time But children/ obligations add cost Divorce ± increases costs ± may change income distribution marriage Product demand due to ± singles with low expenses ± new couples ± divorced families ± children ± empty nesters --> more income BUAD 307 CONSUMER BEHAVIOR Lars Perner. Instructor 31 .
Household Decision Making Roles/influence ± ± ± ± ± Information gatherers/holders Influencers Decision makers Purchasers Users BUAD 307 CONSUMER BEHAVIOR Lars Perner. Instructor 32 .
Instructor 33 .The Means-End Chain Aim promotion/ positioning at higher levels of chain! Self-esteem Feeling of power Performance Fast acceleration Large engine Values Consequences Attributes BUAD 307 CONSUMER BEHAVIOR Lars Perner.
Instructor 34 . Some research support for modest effects ± Probably limited to one syllable words ± Complex messages can probably not be processed subliminally BUAD 307 CONSUMER BEHAVIOR Lars Perner.S.Subliminal Perception: A Diabolical Marketing Tool? Subliminal messages in ads are illegal in U.
Instructor 35 .g. ± ³80% lean´ vs.Message Framing Many tradeoffs can be stated in two. ³20% fat´ ± $49..00 per person per night based on double occupancy BUAD 307 CONSUMER BEHAVIOR Lars Perner. mathematically equivalent ways²e.
international marketing) Diffusion of innovation (product) Attention (promotion) BUAD 307 CONSUMER BEHAVIOR Lars Perner. Instructor 36 .Some Consumer Behavior Issues That Will Come Up Elsewhere in the Course Demographics (segmentation) Lifestyle (segmentation) Culture/subculture (segmentation.
Instructor 37 .Organizational Buyers Types ± Industrial ± Reseller ± Government and non-profit organizations Characteristics ± Greater involvement ± Bureaucracy ± Long term relationships ± Price is important but may not be the most important factor Purchase types ± Straight rebuy ± Limited decision making ± Extended decision making BUAD 307 CONSUMER BEHAVIOR Lars Perner.
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