Introduction to Consumer

Behaviour

Sanjeev Varshney
What is Consumer Behavior?

The study of individuals,

groups, or organizations
and the processes they use
to select, secure, use, and
dispose of products,
services, experiences, or
ideas to satisfy needs and
the impacts that these
processes have on the
consumer and society.
Why study consumer behavior?
• Consumer behavior theory provides the manager with
the proper questions to ask
• Marketing practice designed to influence consumer
behavior influences the firm, the individual, and society
• All marketing decisions and regulations are based on
assumptions about consumer behavior

Stimulus
Marketer  Consumer

Feedback/Input
 Marketing Strategy & Consumer
Behavior
What is the Core for Marketing
Strategy ?
• Creating Customer Value:
The difference between all the
benefits derived from a total
product and all the costs of
acquiring those benefits.
Process of Marketing Planning & Consumer
Behavior
Overall Model Of Consumer Behavior
 Behavioiur Change: Poll
• Do you expect behaviour of consumers change post COVID
• Yes
• No
• Whose behaviour do you expect will change more post COVID?
• Teenagers
• Youngsters
• Middle age
• Old age
• How do you expect it to change ?
• Cautious
• Spending will go down
• It will be back to normal very soon
• It will become more mindful
Three Broad areas of CB and its Interaction
with Marketing
 To Understand Consumer
Behaviour We need to do
Consumer Research

Most Companies in India and Abroad 
have a Consumer Insight Department 
Exercise
• Financial inclusion is a problem in India. Design a
consumer behaviour study to study the obstacles in
the growth.
• How will you establish the merchandise mix in a
Louis Phillipe store of an area ?
Evolution of Consumer Behaviour
Research
• Motivation Research- In-depth interview
• Behavioural Science Research – quantitative
research methods
• Interpretive Research (Postmodern perspective)-
Ethnographic research
• Data based research – predictive modeling
Quantitative Research Methods
• Secondary Data –
• Data collected through modern retail outlets bills
• Warranty cards and Past customer transactions
• Letters from customers
• Sales Reports
• Panel Data, Bill Data
• Primary Data-
• Observation
• Direct questioning
• Experimentation
• Projective techniques
Consumer Research
• Quantitative Research
• Looking for generalizations/segmentation
• Description of target market
• Want to identify how many people do this ?
• Qualitative Research
• Want to identify why people do this
• How people do this ?
• While launching new product
• Mixed Research
• Start with qualitative research
• Test the ideas from qual through quantitative research
 Designing Consumer Research
• Define the problem
• Identify the business problem
• Identify the marketing problem
• Identify the consumer research problem
• Clearly lay down research question
• Carry out some literature review (please check if the research is credible and
admissible as valid proof)
• Develop research propositions/hypothesis
• Establish the data sources and data collection method
• Establish the unit of analysis, method of analysis and please check does it give
you answers you are looking for.
• Please remember just because you have got higher mean values does not
mean they are significant
• Carry out discussion and try to establish why your results are externally valid
and establish the clear logic. Please give limitations and implications for
marketers.
Project
• Form your groups of 6-8 people and inform your
class CR by Monday evening (12.00 night)
• From the list of live projects choose which one you
want to work and submit your bids for the same in
the form of 3 page slides covering , objective,
research question, method and likely
output/deliverables
• Submit this by Friday (15th July) evening – 12.00
night
Buyer Behavior & Need
Identification

Sanjeev Varshney
Involvement and Types of Decision Making
The Process of Problem Recognition
Non-marketing Factors Affecting
Problem Recognition
Impact on Marketing Strategy
• Measuring Consumer Problems
• Activity Analysis
• Product Analysis
• Problem Analysis
• Human Factors and Emotion Research
• Responding to Consumer Problems
• Activating Problem Recognition
• Generic versus Selective
• Approaches
• Timing
• Suppressing Problem Recognition
Identifying Consumer Problems
 Activating Problem Recognition
The Direct to Home Calorie Conversion 
(DTHCC) model: 
GTC and Effem created a Direct to Home 
model of customer acquisition using the 
GTC Integrated 
Marketing platform.  
Objective:  
-   To educate customers about the 
Nutritional aspect of the food 
-   To maintain long term healthy 
relationship with the customers 
-   To Spread advantages of Pedigree all 
over the country 
-   To create a long term sustainable and 
scalable marketing model 
 Break out group Exercise: Product &
Problem analysis
• In your groups individually collect pictures of 6
products you like or dislike (household goods)
• For the pictures you have collected, share with your
group what you like about the product and what you
dislike about the product
• Now entire group should arrive at common factors
(attributes, features) as to what you like in a
household good.
• Create one slide and send it to the class
• Let,s prioritize in class
Time 15 min
Approaches to Activating Problem
Recognition
• Problem Recognition is a function of :
• Importance
• Magnitude of Discrepancy
• Firms/Marketers can attempt to
• Influence the size of discrepancy by altering the desired
state or the perceptions of the existing state. (Tell the
benefits of the product/generate concern about an
existing state- Your bills are still higher-use CFL)
• Influence the perception of the importance of an existing
discrepancy
Generic versus Selective
 Assignment
• In your groups choose and carry out a detailed activity
analysis for a chosen product/service and suggest a
change in the currently existing product/service class.
• Define the target market it is aimed at
• What value it is adding to the existing product
• Make a small presentation on the same
Note: Please go thru videos on design thinking to
develop a good idea

29
Working with Creativity
• Your creative idea can’t just be anything as it needs
to satisfy a couple of questions first, so go and ask
yourself:
• Does it appeal to my target market?
• Does it differentiate me from the competition?
• Does it achieve my overall objectives?
• Does it communicate value?
• Can I work with it across other media and in my
budget

30
 Information search
Perceptual Mapping &
Positioning

Sanjeev Varshney
Nature of Information Search
• Internal Search: relevant information from long-term
memory
• External Search: external information relevant to solving the
problem
• Ongoing Search: to acquire information for possible later
use and because the process itself is pleasurable
Types of Information Sought
• Evaluative Criteria: factors or features that are used to base
a decision
• Appropriate Alternatives:
• Evoked Set
• Inert Set
• Inept Set
• Alternative Characteristics: each brand on each pertinent
evaluative criteria
Information Search in Consumer
Decisions
Categories of Decision Alternatives
Awareness & Evoked Sets
Information Sources for a Purchase
Decision
Perceived Costs and Benefits of Consumer Search
Guide Search Effect

Benefits obtained
Financial
Psychological Continue 
YES
Physical search effort
Quality Product Do the expected 
benefits of 
external search 
Costs of search exceed the 
Out-of-pocket  expected costs?
    expenses Terminate 
Psychological NO search effort
Time
Activities missed
Amount of External search
• Long before purchase (Low involvement learning)

• Immediately before purchase

• Market Characteristics
• Product Characteristics
• Consumer Characteristics
• Perceived risk
Influencing Factor Sub Factor Impact
Market Characteristics No of alternatives Increase
Price Range Increase
Store concentration Increase
Information availability Increase
Product Characteristics Price Increase
Differentiation Increase
Positive products Increase
Consumer Characteristics Learning & experience Decrease
Shopping Orientation Mixed
Social Status Increase
Age & Household Life cycle Decrease
Product Involvement Mixed
Percieved Risk Increase
Situation Characteristics Time availability Increase
Task Mixed
Surroundings Increase
Social surroundings Mixed
Physical mental energy Increase
Marketing Strategies Based on
Information Search Patterns
Alternative Evaluation
How Consumers Make Choices
• Rational Choice Theory-optimal choice
• Bounded Rationality: a limited capacity for
processing information
• Affective Choice: choices driven by how they make
the user feel
• Attribute-Based vs. Attitude-Based Choice:
• Knowledge of specific attributes
• The use of attitudes, intuitions, and heuristics
Evaluative Criteria
• Nature of Evaluative Criteria
• Tangible
• Intangible
• Measurement of Evaluative Criteria
• Which criteria are used?
• Brand performance on criteria
• Relative Importance of Criteria
Perceptual Maps

© 2007 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin

Individual Judgment
• Accuracy of Individual Judgments: the ability to judge
performance of competing brands
• Use of Surrogate Indicators: an attribute used to stand
for or indicate another attribute (e.g.. Price)
• Influence on Marketing Strategy:
• Understanding the criteria
• Recognize the ability of individuals to judge
• Focus on surrogate indicators
 Choice based on Heuristics
• Persuasion Heuristics (influence beliefs and attitudes)
• The length-implies-strength heuristics
• The liking-agreement heuristics
• Consensus-implies-correctness heuristics (the bandwagon
effect)
• Prediction Heuristics (likelihood judgements)
• Representative heuristics (law of large numbers, gamblers fallacy,
regression to the mean)
• Availability heuristics
• Simulation heuristics
• Anchor-and-adjustment heuristic
• Influence or choice Heuristics
Performance on Each Evaluative
Criteria
Decision Rules Used by Consumers
Conjunctive: Select all (or any or first) brands that surpass a minimum level on 
each relevant evaluative criterion.
Disjunctive: Select all (or any or first) brands that surpass a satisfactory level on 
any relevant evaluative criterion.
Elimination- Rank the evaluative criteria in terms of importance and establish        
by-aspects satisfactory levels for each.  Start with the most important attribute 
and eliminate all brands that do not meet the satisfactory level.  
Continue through the attributes in order of importance until only one 
brand is left.
Lexicographic: Rank the evaluative criteria in terms of importance.  Start with the 
most important criterion and select the brand that scores highest on 
that dimension.  If  two or more brands tie, continue through the 
attributes in order of importance until one of the remaining brands 
outperforms the others.
Compensatory: Select the brand that provides the highest total score when the 
performance ratings for all the relevant attributes are added (with or 
without importance weights) together for each brand.
Conjunctive Decision Ad
Disjunctive Decision Ad
Elimination-by-Aspects Ad
Lexicographic Decision Ad
 Things to remember about Decision
Making
• Consumer will maximise value or minimise risk
• Framing effect (reference point)
• Loss aversion (prospect theory)
• Endowment effect
• Choice deferral

The value function that passes through the reference point is 
s-shaped and asymmetrical. The value function is steeper for 
losses than gains indicating that losses outweigh gains.
Information Processing for
Consumer Decision Making
The Nature of Perception
• Exposure: when a stimulus comes within range
of our sensory receptor nerves
• Random vs. Deliberate
• Attention: when the stimulus activates one or
more sensory receptor nerves and the resulting
sensations go to the brain for processing
• Low vs. High Involvement
• Interpretation: the assignment of meaning to
sensations
• Low vs. High Involvement
Stimulus Factors
• Size and Intensity – influence the probability of
paying attention

• Color and Movement – serve to attract

attention

• Position – placement of the object in a person’s

visual field
The Impact of Size
on Advertising Readership
Color and Size Impact on Attention
Stimulus Factors
• Isolation – the separation of a stimulus object
from other objects

• Format – manner in which the message is

presented

• Contrast – the tendency to attend more closely

to stimuli that contrast with their background
(Adaptation Level Theory)
Use of Isolation and Contrast
Individual Factors
• Interest – a reflection of overall lifestyle and the ability to
attend to information

• Need – reflection of long-term goals and plans and their short-

term needs

• Ability- Knowledge and Familiarity with the product

Situational Factors
• Program Involvement:
• Clutter
Non-focused Attention
• Hemispheric Lateralization – activity that takes
place on each side of the brain
• Left side: verbal information, symbolic representation,
sequential analysis, ability to be conscious and report.
(rational thought)
• Right brain: pictorial, geometric, timeless and nonverbal
information (images and impressions)
• Subliminal Stimuli – a message that is presented so
fast that one is not aware of seeing or hearing it
Determinants of Interpretation
Individual
characteristics

Stimulus
Interpretation:
characteristics
Gestalt Cognitive
Affective

Situational
characteristics
Interpretation
The assignment of meaning to sensations

• Cognitive interpretation – process whereby

stimuli are placed into existing categories of
meaning

• Affective interpretation – the emotional or

feeling response triggered by a stimulus such as
an ad
Interpretation Characteristics
• Individual:
• Learning
• Expectations
• Situational:
• Contextual Priming
• Stimulus:
• Stimulus organisation
• Sensory Discrimination
• Ambush Marketing
Have a safe winter.

Drive Bridgestone Tires
Impact on Marketing Strategy
• Impact on Retailers
• Brand Name and Logo Development
• Effective Media Strategy
• Advertisement and Package Design
• Warning labels and Disclaimers
• Evaluating Advertising effectiveness
• Ethical Concerns
 Post-purchase Processes,
Customer Satisfaction, and
Customer Commitment

Sanjeev Varshney
Post-purchase Consumer Behavior
Post-purchase Dissonance

• Post-purchase Dissonance: a consumer reaction

after making a difficult decision that involves doubt
and anxiety
• Probability of experiencing dissonance increases
based on:
• Degree of commitment or irrevocability
• Importance of the decision
• Difficulty in choosing
• Individual’s tendency to experience anxiety
Post-purchase Dissonance
• Approaches to reduce dissonance:
• Increase the desirability of the brand purchased
• Decrease the desirability of rejected brand
• Decrease the importance of the purchase
• Reverse the purchase decision (return before use)

Consumption Guilt-
when negative emotions or guilt feelings are aroused by the use of a 
product or a service. Marketers generally provide a rationale for indulging 
in the consumption act
Disposition Alternatives
Consumer Satisfaction an Overview
• It is the consumers fulfillment response (complete
Consumption Experience)
•Satisfaction with events that happen during
consumption
•Satisfaction with final outcomes
•Satisfaction with level of satisfaction received

It is a judgment that a product or service feature, or the

product or service itself, provided (or is providing) a
pleasurable level of consumption-related fulfillment,
including levels of under-or over fulfillment.
Factors Leading to Consumer
Satisfaction
• Personality Traits
• Expectations (we can control the commitments having
impact on expectations)
• Performance (quality, price, service, features
etc)
• Service Encounter
Information processing (we can control the sources of
information)
• Reputation
• Promotion
Disconfirmation (Performance Outcomes)
Post purchase outcome
Cognitive Dissonance (post –purchase dissonance)
Expectations
• It is what the customers bring to purchase
• Variants of Expectations
Wanted
Ideal Tolerance Zone

Excellence
Desired
Zone of
Deserved Indifference

Needed
Adequate
Minimum Tolerable
Predicted Intolerable
Expectations, Performance,
and Satisfaction
Sources of Information

• External Sources:
• Promotional claims
• Word-of-mouth
• Third party Information
• Product Cues
• Internal Sources:
• Past Experience
• Ease of recall (recency effect)
• Vividness of recall (distinctiveness)
Customer Satisfaction Outcomes

Will a satisfied customer be ready to pay more or stay 
even after the charges are increased ?
Dissatisfaction Response
Disconfirmation (negative)
• Disconfirmation has three components:
• Event, Probability of occurrence & its (un)desirability
• Three states of Dis-confirmation:
• Positive disconfirmation (Low probability that desirable
events occur/high probability un-desirable events do not
occur)---getting A grade while expecting B
• Negative disconfirmation (High probability desirable
events do not occur/low probability un-desirable events
occur----getting C grade while expecting B
• Zero
Relationship between Expectations & Dis
-confirmation
+ Disconfirmation

Very high
Positive - Disconfirmation
Expectations

Satisfaction Zone

Dis-Satisfaction Zone
Very Low
Negative + Disconfirmation
Expectations

- Disconfirmation

Involved consumers have been found to report higher levels of

(positive) disconfirmation and of satisfaction
Model for Consumer Satisfaction

Positive
Expectations word-of mouth

Repurchase-
Intention
Calculated Subjective Satisfaction/
Disconfirmation Disconfirmation Dissatisfaction
Brand Loyalty

Performance Complaint
Outcomes
Creating Committed Customers
Psychological Processes in achieving
Consumer Satisfaction

Antecedents
Consequences
•Personality traits

•Perceived performance Consumer •Cognitive Dissonance

Satisfaction
•Attribution
•Expectations
•Emotional expression
•Disconfirmation
Ways and Means to Enhance Customer
Satisfaction
• Minimize the negative emotions being generated at
the time of purchase
• Effectively make use of Advertising to reduce
cognitive dissonance
• Continuously supplement the consumer with
information that helps him in decision making and
reduce cognitive dissonance
• Have follow up sales efforts
• Do not over sell (customer expects fairness and
equity)
 Ways and Means to Manage Consumer
Dis-satisfaction
• Customer level:
• Be proactive
• Hear out your consumer complaints
• Grievance redressal system should be in place
• Inform the customer process and procedure for handling the complaints
• Make proper time commitments ( take an additional day or two)
• Revert back in stipulated time
• If need arises do not hesitate from informing him about the competent
authorities
• Give him/her research based data (technical details ) wherever needed
• Company level:
• Increase expenditure on promotion to handle cognitive dissonance and
choose the right medium
• Send mailers and updates on new product development etc. to handle post
purchase dissonance
Part II

Measuring Consumer
Satisfaction
Indicators of Satisfied Consumers

• Low Number of Complaints (precaution)

• Repeat Purchase
• Referrals/referral purchase
• Brand Loyalty
• Profitability
• High Market share
Methods of Measuring Consumer
Satisfaction
• Complaint & suggestion system
• Customer satisfaction surveys
• Likert type scales
• Semantic Differential scales
• Ghost shopping
• Lost Customer analysis
• For product & service features:
• Laddering
• Critical Incidence technique
Exercise

• Write one memorable incidence of

your interaction with a seller when
you were satisfied after purchase
• Recall an incidence when you were
annoyed and highly dis-satisfied
after making a purchase/interacting
with the service provider
Laddering
• Build repo but do not divulge your purpose of interviewing
• Opening questioning should be simple and non-threatening
• Never ask personal details in the beginning itself. Many of them
can be so personal that the consumer might not like to share
them
• Probe further depending on responses received
• Many a times repeating same question in different words might
give you answers.
• Paraphrasing can help in these situations
• Close and say thank you for time
• Analyse this data using content analysis
• Do pivoting to look for trends
Case Discussion
• Schemes
• Problem: sales is not picking up
• Ads were not influencing people
• Positioning was a problem ( fragrance was related to
cleaning power- harsh soap, skin care )
• What were the needs :
• Retailing was a problem –shelf space was bottom and not
with premium brands
• Coupon redemption is a problem
• Dove was an exemplar – mee too ?
• Research was done in ontario
Decision point : to continue or
discontinue
• Results were not same
• 64% said they will buy
• Coupon was launched
• Market was very price sensitive – charging high was
difficult
• Soap is soap
• Retailer was boss

• Decision is what to do next ?

What has gone wrong ?
• Very few people tried , no redemption
• Where did we wrong ?
• Execution – underplayed the role of retailer
• Overpriced
• Awareness set : 73%
• Consideration set: ( price, positioning-premium
beauty soap, perceived as women, skin care ,
fragrance , perception was it is harsh, 80% have
showers vs bath)
• Ads did not have any effect
• Awareness -73.5%
• Consideration set- 14.2%
• Trial generation -4.4% multiple usage
• Repeat purchase –
• Market share -0.9%
• Is every body using it in the family
• Avg time a soap last
• Cleopatra- 8.7 weeks
• Camay- 3.5
• Dove- 3.1
• Plamolive-2.5
• Aloe Lincoln- 1.4 weeks
Motivation & Personality

Sanjeev Varshney
 Consumer Motivation 
Involvement
and
Affect
Actual
State
Goal-
Need Drive directed Incentive
Stimulus State Objects
Recognition Behavior

Desired
State

Motivation: An activated state within a person that leads to goal-directed

behavior. It is the reason for behavior.

Motive: An unobservable inner force that stimulates and compels a

behavioral response and provides specific direction to that response.
 THE PROCESS OF MOTIVATION

 Needs—desires that arise when a consumer’s actual
state does not meet his or her desired state.
n Physiological Needs—innate or primary.
n Psychological Needs—secondary.

 Wants—learned manifestation of needs.
n Product-specific needs or need satisfiers.
 THE PROCESS OF MOTIVATION

Needs are aroused via three routes:

1. Physiological
2. Emotional
3. Cognitive

Aroused needs create tension or drives.

Drives motivate consumers to return to a

preferred or desired state, called the goal.
 Maslow’s Motive Hierarchy

5. Self-actualization: This involves the desire for self-

Advanced fulfillment, to become all that one is capable of becoming.
4. Esteem: Desires for status, superiority, self-respect, and
prestige are examples of esteem needs. These needs
relate to the individual’s feelings of usefulness and
accomplishment.
3. Belongingness: Belongingness motives are reflected in a
desire for love, friendship, affiliation, and group acceptance.
2. Safety: Feeling physical safety and security, stability,
familiar surroundings, and so forth are manifestations of
safety needs. They are aroused after physiological motives
are minimally satisfied, and before other motives.
1. Physiological: Food, water, sleep, and to a limited extent,
sex, are physiological motives. Unless they are minimally
satisfied, other motives are not activated.
Basic
Marketing Strategies and Maslow’s 
Hierarchy
1. Blister proof your feet:
2. Eating oatmeal is good for your heart
3. “Sar hen apka marji hen apki” ad of an helmet
4. Wherever teens gather, you’ll hear it. It’s the 
language of terrific fit and fashion
5. Your hand should look as contemporary as the 
rest of you
6. “ Be all you can be”
7. Challenges, Adventure and Growth”
 McClelland Trio of Needs
Need for Power
Need for affiliation
Need for Achievement
 SELF-DETERMINATION THEORY

 Intrinsic Motivation—pursuing an activity for it’s 
own sake.

 Extrinsic Motivation—pursuing an activity in order to 
receive a reward.

What is the Implication of this Understanding?

Understand the motivation of the consumer and that 
will give you the positioning and the theme for 
designing marketing campaigns 
 The Dynamics of Motivation
Needs are never fully satisfied
New needs emerge as old are fulfilled
Success or failure influence goals
Substitute goals
Frustration
Defense mechanism
n This gives various advertising appeals 
Multiplicity of needs & goals
Motivation Theory and Marketing 
Strategy
Discovering Purchase Motives
Marketing Strategies Based on Multiple 
Motives
Marketing Strategies Based on 
Motivation Conflict
Do Marketers Create Needs?
Latent and Manifest Motives
Motivation Research Techniques
Write a Story Around this Picture

Story should have a
n Beginning, 
n Body and 
n An End 

 Also describe the 
characters in your 
story.
Most Ads appeal to Multiple Motives
 Motivation Conflict
Approach-Approach Conflict
Approach-Avoidance Conflict
Avoidance-Avoidance Conflict

What are the marketing implications of the same ? 
Give examples 
Psychological Processes behind 
Motivation  
Consistency theories
n Attitude Function theory
n Balance theory

n Cognitive Dissonance theory  – Behaviour-

attitude discrepancy
Discrepancy interruption theory-  Discrepancies or
surprises and interruptions increase arousal and
emotion. Discrepancies require immediate attention.
Small discrepancies produce positive emotions
Large discrepancies produce negative emotions

Excitation-transference theory
 Personality
“Personality is the dynamic organization within the 
individual of those psychophysical systems that 
determine his unique adjustments to the 
environment.”  
 Personality theories
Which Personality theories have been 
explained in the articles for the session ?
n Psycho-analytic theory
n Social learning theory
n Stimulus response theory
n Trait theory
 Freudian Theory of Personality

Gratification ID EGO

SUPEREGO
Neo-Freudian Theory of Personality

Social Relations are fundamental to the 
formation and development of personality
Horney who focused on child-parent 
relationships and desire to conquer 
feelings of anxiety identified 3 personality 
groups:
n Compliant individuals
n Aggressive individuals
n Detached individuals
 Trait-Personality Theory
Two Common Assumptions:
All individuals have 
internal characteristics or 
traits
Consistent and 
Measurable differences 
between individuals
A trait is a consistent, long-lasting tendency in behavior. 
The Five-Factor Model of Personality
Dimensions of Brand Personality
Personality & Consumer Behaviour
Consumer Innovativeness
Consumer Dogmatism- rigidity vs. 
flexibility towards unfamiliar
Need for uniqueness
Sensation seeking
Consumer materialism
Compulsive consumption-addiction
Consumer ethnocentrism
Conspicuous consumption
 CHARACTERIZATION

 Brand Personification—
giving non-humans human-like
traits.

 Brand Anthropomorphism
—giving non-humans both
human form and human-like
traits.
 Brand personality
What personality characteristics come to mind for the 
following:
Brand is repositioned several times or changes its 
slogan repeatedly
Brand uses continuing character in its advertising
Brand charges a high price and uses exclusive 
distribution
Brand frequently available on deal
Brand offers many line extensions
Brand uses recycled materials
Brand features easy-to-use packaging or speaks at 
consumer’s level in advertising
Brand offers seasonal clearance sale
Brand offers five-year warranty or free customer hot line
Learning, Memory, and
Product Positioning

Sanjeev Varshney
The Role of Learning
Learning Theories and Involvement
Learning through Conditioning
Conditioning refers to learning based on association of a
stimulus and response.
• Classical (low involvement): using an established
relationship between a stimulus and response (Pavlov
Dog)
• Operant (high involvement): molding or shaping
behavior by using a reinforcement (Skinner’s pigeon)
Classical Conditioning
Affective Influence in Trial
Operant Conditioning
The Process of Shaping
 Cognitive Learning
Cognitive learning encompasses all the mental
activities of humans as they work to solve problems
or cope with situations.
• Iconic Rote (low involvement): the association
between two or more concepts in the absence of
conditioning
• Vicarious/Modeling (low or high involvement):
Observing the outcomes of others’ behaviors and
adjusting their own accordingly
• Reasoning (high involvement): Individuals engage in
creative thinking to restructure and recombine
existing information as well as new information to
form new associations and concepts.
Summary: Learning Theories & Involvement
 Linking Learning to Memory...
• Characteristics of Learning
– Strength of Learning
– Extinction
– Stimulus Generalization and Stimulus Discrimination
– Response Environment
• What is “memory”?
• How is memory like a computer?
– Sensory Memory
– Short-Term
– Long-Term
Example of Stimulus Generalisation
 Strength of Learning
• Importance
• Message Involvement (sing along)
• Mood
• Reinforcement/Punishment
• Repetition
• Dual Coding
 Exercise
• Read these words- Time: 30 sec
– Sholay
– Zanjeer
– Agnipath
– Baghban
– Paa
– Viruddh
– Deewar
– Abhimaan
– Mard
– Cheene kam
• Now try to recall these words: Time: 30 sec
 The Psychology of Learning (Tony
Buzan)
• The human brain primarily remembers the following:
– Items from the beginning of the learning period (the primacy
effect)
– Items from the end of the learning period (the recency effect)
– Any items associated with things or patterns already stored, or
linked to other aspects of what is being learned
– Any items which are emphasized as being in some way
outstanding or unique
– Any items which appeal particularly strongly to any of the five
senses
– Those items which are of particular interest to the person
 Increasing Retrieval
• Avoid competing Advertising
• Strengthen Initial Learning
• Reduce Similarity to Competing Ads
• Provide External Retrieval Cues
• Spacing
Influencing choice without altering brand evaluations:
Impact of Brand Priming on Other Brands

Product Class

Major Subcategory Minor Subcategory

Major Brand Minor  Major  Minor 

Brand Brand Brand
The Impact of Repetition
Repetition Timing on Advertising Recall
Forgetting Over Time
 Forgetting
• Decay
• Interference
• Part-list cueing effect
Case Discussion :
 Memory
• Sensory Meaning
• Semantic Meaning (symbolic associations)
• Episodic Memories
• Schematic Memory

Sensory  Short Term  Long Term 

Memory Memory Memory

Attention Elaborative 
Rehearsal
Schematic Memory
 Associative Networks Exercise
• In your groups take a major brand in the product
category chosen for your project. Develop associative
networks for the same and discuss results in next
class.
• Please remember your imagery should have the
following:
– Product characteristics
– Usage situations
– Episodes
– Affective reactions
Word cloud from Indian Movies
Word Cloud from People’s Perception
 Group Exercise
• Based upon 2 word clouds , how will you
change the image of police:

»Time : 10 min
Connecting Memory to Marketing
Strategy
• Brand Equity: the value consumers assign to a
brand above and beyond the functional
characteristics of the product
• Brand Leverage: often termed family
branding, brand extensions, or umbrella
branding, refers to marketers capitalizing on
brand equity by using an existing brand name
for new products.
 Brand Equity

Brand
Perceived value

Brand Brand
Awareness
Brand Equity Associations

Brand Loyalty
 Brand Extension

Name well
established

Boost sales Brand known

of the core Benefits of for high
brand using quality
same brand
name

Synergy Marketing
among costs
the products are lower
 Brand Dilution

Evaluate consumer 
Evaluate the fit between
perceptions of the 
the product class
attributes of the core brand 
of the core brand
and seek out extensions 
and the extension.
with similar attributes.

Refrain from  Is the brand 
extending the brand  extension distanced 
name to too many  enough from the 
products. core brand?
 Brand Repositioning

New design
New message
New faces
New audience
New image
New packaging
New uses
Identify a Brand that needs repositioning. How would you
reposition the brand
 Measures of Consumer Learning
• Recognition & Recall Measures
• Cognitive Measures
– Comprehension (pre-testing & post-testing)
• Attitudinal and behavioral measures of Brand Loyalty
 How to Carry out life style analysis
• Profile the customer on Activities, Interests, Hobbies, media habits,
value system etc.
• Once done clean data (drop respondents with insufficient data)
• Code
• Either use answer tree or identify the factor dividing consumers
into two large groups
• Now look for second variable which can divide the consumers into
further groups
• Continue this exercise till you reach a stage where further division
will not add value and the group becomes small enough to be
distinctly recognized.
• Now define each group
Self-Concept and Lifestyle

Sanjeev Varshney
 What is a Self-concept?

Self-concept: the totality of the 
individual’s thoughts and feelings 
having reference to him-or herself as 
an object

Self-concept can be divided into four 
basic parts…
Dimensions of a Consumer’s Self-
Concept
Exercise
How does a tattoo affe
ct one’s self-concept a
nd become part of one’
s extended self?
Will one or multiple visi
ble tattoos become the 
norm for younger cons
umers over the next 10 
years?
Exercise Can you describe the 
personality of these 
two girls
 Extended Self
Self + Possessions 

q Think of products that explain your self.
q Identify  one  single  product  in  your   
possession  which  you  feel  contribute  to 
yours self concept and has become part of 
your extended self. 
Interaction of Self-Concept 
and Brand Image
 Measurement of Self Concept

Rate your own actual self concept (A)
Rate your desired self concept (D)
Rate the Brand concept of Garnier Men’s 
products
Rate the person concept of John Abraham 
Assess the consistency of these four 
concepts
 Life Style
How a Person Lives  or how one enacts 
his or her self concept
Determined by:
n Past experiences
n Innate experiences
n Current situation
Lifestyle and the Consumption 
Process
 Measurement of Lifestyle
• Can be used as a general
measure, but most
Lifestyle Studies
commonly used to measure
n Attitudes a specific product or activity.
n Values
n Activities and Interests • General lifestyles can be
n Demographics used to discover new
product opportunities.
n Media Patterns
n Usage Rates • Specific lifestyle analysis
may help reposition existing
brands.
Cosmetic Life Style Segments of 
UK women
 The Vals System
SRI Consulting Business Intelligence
42 statements of agreement
Classifies individuals using two dimensions
n Self Orientation

Principle oriented
Status oriented
Action oriented
n Resources

Individuals are placed in one of 8 general 
psychographic segments
 VALS 
Lifestyle 
System
Demographics of the VALS 
Segments
Actualizer Fulfilled Believer Achiever Striver Experiencer Maker Struggler Total
VALS Segment Ownership and 
Activities
Total Actualizer Fulfilled Believer Achiever Striver Experiencer Maker Struggler
Product Possession Analysis/Life 
Style analysis 
This will help you in identifying possible 
market segments in absence of 
psychological and behavioral data
Better than demographic profiling
Becomes a basis to run marketing 
campaigns and launch schemes
Provides an input for better consumer 
understanding  and range selling at store 
Level 
 Exercise
From the data given identify different Life-
style segments 
Yankelovich’s MONITOR MindBase
Considers the individual’s position on a set of core 
values with his or her life cycle stage
Values identified include:
n Materialism

n Technology orientation

n Family values

n Conservatism

n Cynicism versus optimism

n Social Interaction

n Activity level

Grouped into 8 high-level segments
Consumption Differences across 
MindBase Segments
 Geo-Demographic Analysis 
(PRIZM)
Based on the premise that lifestyle, 
and thus consumption, is largely 
driven by demographic factors
Analyzes geographic regions
Every neighborhood in the U.S. can 
be profiled
Total of 62 lifestyle clusters
International Lifestyles: GLOBAL 
SCAN
 GLOBAL SCAN 
Segment Sizes across Countries
 Assignment 
Each group should carry out Interview with 
minimum of 5-10 young consumers (Age 14-25) 
and identify Lifestyle patterns
Share these findings with the batch by 17th July 
Lets identify consumer segments based on 
these findings. Each group should do this based 
on information provided by all the groups
Each group should mail their findings to me by 
20th
We will have discussion on this in next class
How to Carry out life style analysis
Profile the customer on Activities, Interests, Hobbies, 
media habits, value system etc.
Once done clean data (drop respondents with insufficient 
data)
Code 
Either use answer tree or identify the factor dividing 
consumers into two large groups
Now look for second variable which can divide the 
consumers into further groups
Continue this exercise till you reach a stage where 
further division will not add value and the group becomes 
small enough to be distinctly recognized.
Now define each group