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Chapter 9 Individual Decision Making Describe the different sections of the Rational Consumer Decision Making model (p.

.262) Problem Recognition v Information Search v Evaluation of Alternatives v Product Choice v Outcomes (Repeat) Why do we say mindless decision making can actually be more efficient? If we used rational decision making processes for every decision we would have to no time left to enjoy life. What is purchase momentum and how does it relate to the model of rational decision making? Buying impulses increase our likelihood of buying more like getting revved up and plunge into a spending spree. Name two ways a consumer problem can arise? Need recognition: quality of persons actual state can move downward. (person running out of gas) Opportunity recognition: consumers ideal state moves upward. (craving a newer, flashier car) fig9-3 What is sunk-cost fallacy? The reluctancy to waste something that we ourselves paid for. eg. A free ticket vs. A paid ticket. If there was a massive snowstorm on game night people would most likely risk the storm if they had a ticket they paid for. List three types of perceived risk and examples. Monetary Risk (eg. Real estate values dropping) Functional Risk (eg. Drill bits, if not used properly will break) Physical Risk (eg. Buying a motorcycle) Social Risk (eg. Wearing the wrong clothing) Psychological Risk (eg. Blood diamonds, fur) Describe differences between subordinate, superordinate, and basic level category. Superordinate: most broad level. (eg. Desserts) Basic Level: items have a lot in common but still permit a range of alternatives to be considered. (eg. Fattening dessert vs non-fattening dessert) Subordinate: More specific often with brands. ( cream, pie, cake vs fruit, yogurt, diet ice cream) What is an exemplar product? A product that is a really good example of a category, it is more familiar to consumers, and as a result

is more easily recalled and recognized. (eg. Coca Cola is the exemplar product of the soft-drink market.) What is the difference between inertia and brand loyalty? Inertia: a brand is bought out of habit, because it is easier or cheaper than alternatives. Little thought process is involved; however, if another product came by that was easier the consumer would not think twice about switching. Brand Loyalty: A form of repeat-purchasing that is a conscious decision to keep buying the same brand. Along with repeat purchases an underlying positive attitude towards the brand is included. Consumers are actively involved with brand and emotionally attached. They would not switch brands very easily even if the price was increased. Describe the difference between a non-compensatory and a compensatory decision rule? Compensatory: rule that a good attribute can compensate for poor attributes. Simple Additive rule Weighted additive rule Non-compensatory: rule that some poor attributes can eliminate an alternative all together. Lexicographic rule Eliminative-by-aspects rule Conjunctive rule Chapter 10 Buying and Disposing What is situational self-image? Who am I right now? The attitude and behaviours a person has at that instant. Are they being a man on the town where they spend lavishly and drink expensive wines and liquors to impress women or one of the boys where they care less about appearance and more on drinking beer and watching sports. Describe the difference between crowding and density. The presence of people creates an arrousal that can be both positive and negative. Density refers to the actual number of people occupying a space. The psychological state of crowding only exists if a negative affective state occurs as a result of the density. 100 people in a classroom designed to fit 75 is crowding but if it was a party the feelings may be more positive then negative. What is time-poverty? The feeling of being pressed for time, or not having enough. It may be due to perception rather than fact. People nowadays have more things to occupy their time with. List three motivations for shopping. Social experiences many people don't have anywhere to go for social outings so malls are becoming increasingly more popular for social gatherings. Sharing of common interests stores frequently have specialized goods that allow people with shared views and interests to communicate. Interpersonal attraction shopping malls are natural places to congregate, hangouts for teenagers, and controlled, safe environments for seniors. Instant status some people savour the experiences of being waited on and feeling important. (Harry Rosen)

The thrill of the chase some people pride themselves on their knowledge of the marketplace. They may relish the process of haggling and bargaining, viewing it almost as a sport. Pros and Cons of E-Commerce. Shop 24/7 less travel instant information more choices more price information more products available to developing countries Factors of store evaluation/image. Interior Design Types of Patrons Return Policies Credit Availability Unplanned buying and Impulse buying. Impulse: a sudden urge to buy than the consumer cannot resist. Unplanned: a person is prompted to buy something in-store because they are unfamiliar with store layout and are under a time restraint. Or a person is reminded to buy something by seeing it on shelves. What is lateral cycling and why is it important to marketing? Already purchased items are resold to others or exchanged. Flea markets, garage sales, ebay, kijiji, hand-me downs etc... List three actions consumers can take if they are dissatisfied with a purchase. Voice Response: consumer appeals directly to retailer (eg. Refund/exchange) Private Response: person discusses dissatisfaction to friends or people online. (negative word of mouth can be harmful to businesses) Third-party Response: Consumer takes legal action against merchant, registers complaints with BBB, or writes letters to newspapers. POP (Point of Purchase Stimuli) Elaborate product displays Demonstrations Free samples Coupon dispensers Chapter 11 Group Influence and Opinion Leadership Reference Groups groups that have relevance on individual's behaviours, evaluations, and aspirations. They influence consumers in three ways: Informational: what do the experts do or what brands do experts approve of. (eg. Buying a camera that a professional photographer uses) Utilitarian: individuals influenced by coworkers, friends, and family. (eg. Friends wear sports jerseys so I go out and by one.)

Lack of security Fraud Can't touch or try on items Exact colours may not reproduce online Expensive to make returns Breakdown of human relationships

Value-expressive: buying a product that the consumer feels will enhance their image, and reach their ideal self, or gain respect from peers. (eg. Buying a Mercedes to get respect from people) Reference groups influence is stronger on purchases that are luxuries, and visible to others.

Types of Reference Groups: Normative influence: helps set and enforce fundamental standards of conduct (eg. Parents - University) Comparative influence: decisions about specific brands or activities (eg. Harley Davidson fan club) List types of social power. Social Power refers to the capacity to alter the actions of others. Referent power: a person admires the qualities of a group so they try to imitate thems. Information power: a person having information that others want to know. Legitimate Power: granted power by virtue of social agreement. (people in uniform) Expert Power: people possessing a skill or knowledge in something (doctors) Reward Power: when a person or group has the means to provide positive reinforcement Coercive power: intimidation, personal selling, and emphasizing the bad things than can happen from not using a product or service. Which groups have more influence on purchasing decisions: small informal or large formal? Small informal groups can have a larger more powerful impact on individuals. What is a brand community? Brand community is a set of consumers who share a set of social relationships based on usage or interest of a product. They typically do not live near each other and only meet at brand fests like the Harley Davidson meet and greet. Deindividuation? The submersion of individual identities in a group. Eg. People at haloween parties or costume parties behaving more wildly. Whats the difference between normative and informational informational social influence? Social Loafing refers to the fact that people in a larger group do not devote as much effort to a task when their

contribution is part of a larger group effort. Eg. People in large groups tip less than individuals. Social Comparison Theory look to the behaviour of others to set a benchmark about reality. It is a way of increasing the stability of a persons self-evaluation. (Eg. A DJ needs to know who is at the party because although there is no right or wrong music the people at the club will put pressure on him to play the best music mixes.) Viral vs Guerilla Marketing Guerilla Marketing: strategies using unconventional locations and intensive WOM campaigns to push products. Viral Marketing: strategies of getting customers to sell a product on behalf of the company that creates it. Consumer Tribe Consumer tribe is a group of people that share a similar lifestyle and who can identify each other because of a shared allegiance to an activity or a product. Tribes are generally short lived and youth oriented like skateboarding. Chapter 12 Household Decision Making What is a nuclear family and how is it different from an extended family? Nuclear Family a mom, dad, one or more children. Extended family three generations living together. Who are boomerang kids? Kids that move back in with their parents. What is FLC and why is it important to marketers? The family life cycle (FLC) are factors that determine how couples spend money. The FLC combines trends in income and family composition. What are the different stages of FLC? Single adult > New couple > couple with children > couple with teenagers > launching children > family later in life What are the roles in the family? 1. Initiator 2. Information gathering 3. Gatekeeper 4. Influencer 5. Decision-Maker 6. Buyer 7. Preparer 8. User 9. Maintainer 10. Disposer What is the difference between consensual and an accommodative purchase decision?

Consensual: the group agrees on the desired purchase, differing only in terms of how they will make it happen. The whole family agrees to get a dog but the parents discuss how it will be taken care of and what kind of dog. Accommodative: group members have different preferences and priorities and cannot agree on a purchase that will satisfy everyones needs. Bargaining and coercion is used. Autonomic and Syncretic decisions: Autonomic: one person is responsible for the decision Syncretic: two partners are involved Describe a heuristic family: Heuristics simplify decision making: objective dimensions, task specialization, concessions based on intensity of each spouses preferences. Chapter 13 Consumers and Subcultures Discretionary Income: Money available to the household over and above that required for a comfortable standard of living. Excess cash that can be spent on wants Consumer confidence: Consumers beliefs about what the future holds for the economy. The beliefs can indicate how much money consumers are willing to spend or if they are more likely to save. What is pecking order? A consumers ranking on social status. People try to improve their ranking by moving up in social order. People that are haves rank higher than have-nots What is social class? Is it different from income? Social class is used to generally describe the rank of people in society. Social class is more than just income. It is how the money is spent. Difference between achieved and ascribed status? Achieved status is someone that worked for their wealth; whereas, ascribed status is people that were born into money. What is a chav? Young lower-class english people that mix track suits with expensive designer accessories. What is mass class? A large segment of global consumers that now enjoy a level of purchasing power that enables them to afford high-quality products except for big ticket items like university education, housing, or luxury cars. Social mobility: The passage of individuals from one social class to another. Horizontal (changing careers but staying roughly the same, ie nurse -> teacher), downward (getting laid off), and upward (getting promoted).

What are indications of social class? Income, housing, cars, lifestyle, career, etc... Status crystallization: The extent to which different indicators of a persons status are consistent with one another. Taste culture: Differentiates people by their aesthetic and intellectual preferences. (Eg. Upper-middle class people would be more likely to go to an art show than a lower-class person. Old money vs nouvaux riches: Old money has lots of money but does not need to flaunt it. New money flaunt their wealth to make up for an internal lack of assurance. Chapter 14 Age Subcultures Chapter 15 Canadian Identity & Ethnic Subcultures Acculturation: The process of movement and adaption to one country's cultural environment by a person from another country. Movement: the factors that cause a person to uproot and move from one country to another Adaption: people form new consumption patterns Assimilation: new immigrants adopt new products/habits to fit in with new country. Maintenance: continued use of some country-of-origin products/practices. De-ethnicitization: Happens when a product we associate with a specific ethnic group detaches from its roots to appeal to other subcultures. (Eg. Jalapeno bagels --> Jewish to Mexican) High-context culture vs low-context culture: HCC: group members are tightly knit and they infer meanings that are deeper than the spoken words. (new immigrants) LCC: are more literal (Canadians) Five Phases of Adjustment to New Immigrants The Honeymoon immigrants excited about new opportunities/country Culture Shock the reality sets in Superficial Adjustment the immigrants manage day-to-day life Stress/Depression the immigrants disparage new ways of life and realize the hardships Integration the immigrants move through society with ease as if they were native born. Six French-Canadian Roots 1. Joie de vivre 2. love of children 3. a need to be seen 4. artistic

5. sentimentality 6. instinctiveness Chapter 16 Cultural Influences on Consumer Behaviour Define culture: A societies values and ethics, as well as, the material object valued like: cars, clothing, sports, and food. Public vs Private Rituals Rituals: set of symbolic behaviours that occur in a fixed sequence and tend to be repeated. Private: women putting makeup on in the morning. Public: daily office luncheons Three stages of gift giving: Gestation: giver is motivated by an event to buy a gift Presentation: the process of gift exchange, the recipient responds (positively or negatively) and the giver evaluates this response. Reformulation: the bond between giver and receiver are adjusted, either strengthened or loosened. Define: Rite of Passage: Special times marked by a change in social status. Separation: person is detached from original group/status. (eg. Child leaving home to university) Liminality: person is literally in between stages. (eg. The new arrival on campus tries to figure out what to do for Frosh) Aggregation: person reenters society after the rite of passage is complete. (eg. Student returns home for summer break as a university veteran) Sacred vs Profane Consumption: Sacred: involves objects/events that are set apart from normal activities and are treated with some degree of respect or awe. Profane: involves objects/events that are normal and do not share any specialness. Stages of Sacralization and Desacralization: Sacralization occurs when ordinary events, objects, and people take on sacred meaning to a culture. Eg. Stanley Cup. Desacralization occurs when sacred items or symbols are removed from its special place or duplicated in mass quantities (eg. Reproduction Eiffel Towers) Collecting vs Hoarding: Collecting is a systemic acquisition of objects. Hoarding is unsystematic, uncontrollable acquiring of objects.