TOPIC 1: BUYING, HAVING AND BEING: AN INTRODUCTION TO CONSUMER

BEHAVIOR

Consumer behavior: people in the marketplace

● Consumers take many forms: adults vs. children, individuals vs, groups, students vs.
dean.
● Consumer behavior is a process:
○ Several steps: need recognition, information search, alternative selection,
buying, post-purchase.
○ Many roles: initiator, influencer, decider, buyer, user.
● What is the consumer behavior discipline/field? The study of the processes involved
when people select, purchase, and use products to satisfy their needs.
● Why is it fundamental to understand the consumer? Organizations can only survive if
they satisfy the consumer needs.

How to divide our consumers up, as they are different

● Our society is evolving form a mass culture to a diverse society with endless choices
○ It is key to know consumers in depth.
○ Create specialized messages and products.
● The 80/20 rule:
○ 80% of users account for 20% of sales → focus on the most important
customers.
● Segmentation criteria:
○ Demographic: age, gender, family structure, social class and income, race
and ethnicity.
○ Geographic: continent, country, region, etc.
○ Psychographic: lifestyles.
○ Behavioral: the use consumers make of the product.

Marketing's impact on consumers

● Marketers have a huge impact on the way we live: the products we buy, the movies
we watch, the clothes we wear, the words we speak.
● Popular culture: entertainment forms produced and consumed buy the mass market.
● Role theory: people behave like if they were in a play → influences their consumption
pattern.
● People establish relationships with brand:
○ Self-concept attachment: the product helps to establish the user’s identity.
○ Nostalgic attachment: the product serves as a link with a past self.
○ Interdependence: the product makes part of the user’s daily routine.
○ Love: the product has a strong emotional bond with the user.

What does it mean to consume?

● Our motivations to consumers are complex and varied: needs, budget life goals, peer
opinions, etc.
● People often buy products not for what they do, but for what they mean: we choose
brands that have an image consistent with us.
● Difference between needing something and wanting it:
○ Need: something a person must have to live or achieve a goal.
 ○ Want: a manifestation of a person need’s, it is determined by her personal
and cultural factors.

The global “Always-On” consumer

● Changes in population:
○ Most people live in urban centers.
○ Diversity is becoming the norm.
● Digital natives: those consumers who interacted with digital technology since they
were born.
● Digital revolution:
○ Technology is everywhere from companies to homes.
○ People are connected 24/7: communicating, learning, buying, etc.
● Internet of things (IoT): interconnected devices that communicate among them.

Consumer behavior as a field of study

● Consumer behavior as a field of study:
○ Recent discipline started only a few decades ago.
○ Very interdisciplinary: experimental psychology, microeconomics,
demography, anthropology, etc.
● Where do CB researchers work? manufacturers, retailers, marketing research firms,
governmental agencies, nonprofit, organizations, universities, etc.
● What are the topics investigated in CB? Household products development, retail
construction, web design, public policy, etc.

Consumer trends
● New values that shape consumers behavior and push them towards certain products.
● Many organizations publish their consumer trends reports.
● Important consumer trends:
○ Sharing economy
○ Authenticity and personalization
○ Blurring of gender roles
○ Diversity and multiculturalism
○ Social shopping
○ Income inequality
○ Healthy and ethical living
○ Simplification
○ Interconnection and the internet of things
○ Anonymity

TOPIC 2: CONSUMER WELL-BEING

Business Ethics and Consumer Rights

● Green products → products that are good for the environment.
● “Ethical business is good business” → people prefer ethical products if all things are
equal, and even there's surveys that report people are willing to pay more if the
goods or services are made by companies that implement programs to give back to
society.
○ Increasing number of consumers choose green products.
 ○ Most consumers say they are willing to pay extra to have green products.
○ This feeling is stronger for young consumers.
● Doing well by doing good → performing well financially (profits), but at the same time,
doing good things to society.
● Companies create awareness that a need exists.

Consumer rights and product satisfaction

● What can unsatisfied consumer do?
○ Complain to the company.
○ Take legal action against the company.
○ Buy somewhere else.
● Ignoring customer dissatisfaction can be dangerous for the company.
● Customer complains present a good opportunity for the companies:
○ The company can learn about its mistakes and improve, they get a chance to
correct the situation.
○ If the problem is solved, the relation with the consumer typically improves.
● Market regulation:
○ Several governmental agencies oversee consumer-related activities (OCU,
Oficina del Consumidor y Usuario).
○ These agencies are good to both companies and consumers since they limit
bad practices.

Major policy issues relevant to consumer behavior

● Data privacy and identity theft:
○ Some new technologies (GPS, i.e., facial recognition…) make the market
more effective but also thereat consumer’s privacy.
○ Identity theft occurs when someone steals your personal information and
uses it without your permission.
○ Crime is moving to the internet: identify theft, botnets (another computer
enters yours and takes information, makes purchases, etc.).
● Market access problems:
○ Many people cannot buy what/where they want not because of the money but
due to physical, mental and social barriers (for example, old people or people
with disabilities).
● Triple bottom-line orientation:
○ Companies should care about profits, people (workers, consumers, society)
and the planet.
● Greenwashing:
○ When companies make false/exaggerated claims on how environmentally
friendly they are.
○ Most consumers don’t believe in the companies’ green claims.
○ Consumers stop buying a product if they feel they have been misled.

The dark side of customer behavior

● Addictive consumption (consumo adictivo):
○ Physiological or psychological dependence on the consumption of a product
○ Alcohol, cigarettes, gambling, video games, social media, etc.
● Compulsive consumption:
 ○ Repetitive and excessive shopping that harm the consumer.
● Consumers can also behave unproperly, which becomes an issue for the rest of the
society because then the company will increase the prices to compensate for the
stolen products.
○ Theft
○ Wear once and return

TOPIC 3: PERCEPTION

Sensation
● We live in a world full of sensations:
○ Consumers are never far from ads (banners, tv commercials, billboards) and
product packages.
○ Each person manages this sensory bombardment by paying attention to
some stimuli and ignoring others.
● Sensation:
○ Immediate response of our sensory receptors to basic stimuli (light, color,
sound, odor, texture).
● Marketing messages are more effective when they appeal to several senses.
● Sensory marketing (example: you walk by a bakery and smell the sweets and are
incentivized to buy or the music in a clothes shop).
○ When companies use the senses to create messages (color on the
packaging: bright or palid), shopping experiences, and products that connect
better with consumers and influence the stronger.
*Stimuli is something external to the person, he/she receives it from the world.

Vision
● Marketers use many visual elements in advertising, store design and packaging
○ Size, position, contrats, movement and color.
● Colors influence our emotions:
○ Red → emotion arousal and stimulates appetite.
○ Green → relaxing and helps for concentration.
● Our brain finds it easier to recall colors than words. Human brains are more used to
colors than words. Many years ago the human brain was using colors not numbers,
for example on the savanna when they were chasing animals they used color to drag
attention, they didn't use numbers.
● Different cultures assign different meanings to colors. (example: in China the bride
wears red, in Europe the bride wears white).
● Color preferences depend on gender and age:
○ Typically, women pay more attention to color and have a richer palette than
men.
○ Older people prefer white.

Sense
● Human process fragrance cues in the limbic system, the most primitive part of our
brain.
○ The place where we experience immediate emotions.
● Odors influence emotions:
 ○ These emotions influence behavior.
○ Odors makes consumers feel attracted or avoid certain places, people and
products (example: muy mucho uses his pleasing smell to attract people
inside).
○ Can create calming feelings.
○ Invoke memories.
● Scent memory is stronger than visual memory:
○ Scent memory can persist for a very long time.
○ Some stores have their own scent signature.

Sound
● Music is a very primitive way of human communication:
○ When people listen or sing music together, they move closer to one another,
this is because music has been in our lives for thousands of years.
● Music an other sounds affect people’s feelings and behaviors.
● Memory of music lasts for a very long time and is among the last to disappear (you
can see that in people with Alzheimer's).
○ Some brands have their own jingle and use it in their commercials and stores
to identify the brand and distinguish it from the competition, (example:
mercadona, “leche,cacao,avellanas y azúcar” nocilla).
● When creating a brand name, some companies pay attention to the sound
symbolism.

Touch
● Our experience of touch is much like a primal language that our species learnt before
writing and speech:
○ We have a tendency to touch objects.
● Encouraging shoppers to touch a product makes them feel more attached to it:
○ People value that product more, if you go to a store and are allowed to touch
you feel like it already belongs to you.
○ Increases people’s likelihood to buy it.
○ Makes people willing to pay more for that product.
*Nowadays online brands allow people to return their product for free just to give
them the option to touch them.
● Touch can also influence human interactions:
○ Waitstaff who touched dinners received better tips.
○ Food demonstrators who lightly touched shoppers had a higher number of
customers sample and buy the product.
○ Yet, accidental touch from a stranger (especially male) leads to more negative
reactions.

Taste
● Our taste receptors contribute to how we experience many products:
○ Food and drinks
○ Medicines (example: dalsy for kids)
● Our tastes’ preferences depend on many factors:
○ Culture (example: coke is sweeter in US, indian people say european food
has no taste).
 ○ Gender and age (example: males are more likely to eat spicy food, old people
don’t usually enjoy spicy or very tasteful food).
○ Consumption situation (example: preference for sweet popcorn on romantic
movies or spicy food on action movies).

Stages of perception & personal selection factors

● Perception: process by which people select, organize and interpret the sensation to
which they are exposed.
● Stage 1: Exposure
○ When a stimulus comes within the range for someone’s sensory receptors.
○ Sensory threshold (after some amount of sense we start to be aware that it
exists, a minimum amount of interaction that a person needs to be aware of a
sense, example: sound for dogs or humans) and differential threshold (we are
able to see differences between two stimuli).
● Stage 2: Attention
○ The act of processing the information received from the exposure to a given
stimulus.
○ The level of attention depends on the stimulus (wind in a class), the situation
(level of voice in a disco), and the person receiving it.
○ Perceptual selection: due to the brain's limited capacity consumers are
selective on what they want to pay attention to (example: video of the passes
and the gorilla or looking for something in the supermarket).
○ Perceptual vigilance: we are more likely to be aware of stimuli that are related
to our current needs.
○ It is more likely to notice stimuli that differ from others in terms of size, color
and position.
● Stage 3: Interpretation
○ The meaning people assign to a sensory stimuli.
○ Different cultures give different meaning to the same stimuli: dragons in the
west (danger) and the far east.
○ Depends on the person and her past experiences (fear of dogs because of a
past experience).

TOPIC 4: LEARNING AND MEMORY

How do we learn?
● Learning
○ A relatively permanent change in behavior caused by experience.
○ Ongoing process: we are constantly updating our image of the world as we
receive new information.
● Sources of learning:
○ Own experience
○ Observation of others
● Learning theories:
○ Behavior learning theories: people learn by responding to external events or
stimulus.
 ○ Cognitive learning theories: gives more importance to internal mental
processes by claiming that people learn by creating abstract rules and
concepts.

Behavioral learning theories

● Classical conditioning:
○ A stimulus that provokes a response is paired with another stimulus that
initially does not elicit a response but itself.
○ Pavlov's dogs: a scientist rings a bell to give food to dogs, when it becomes a
habit dogs learn that when the bell rings food is coming. Now when the bells
ring dogs start drooling (babear).
● Repetition:
○ Repeated exposure increases the strength of stimulus-response association.
○ Creates a sense of familiarity to the consumer. Which makes her more likely
to choose it.
○ Is more effective when alternating among different locations (repetición de un
cartel publicitario muchas veces para crear familiaridad, pero en diferentes
localizaciones para que lo vean en diferentes sitios y no siempre en el mismo
lugar).
○ Example: publicity in public transportation it’s very repetitive and they are
meant to be seen by a lot of people multiple times. They put the publicity in
different locations and in different types of transportation so they can reach as
many people as possible. We repeat the same messages in different
locations to create awareness multiple times.
● Stimulus generalization:
○ When people generalize the original stimulus to another similar one.
○ Products from different brands with similar packages are rated similarly.
○ Famous brands extend their product lines. Example: reese's is a chocolate
snack brand that later on extended the brand into cereals. To extend the
product brand the new product should have some relation with the first one.
For example if your company produces bleach you won’t be successful if you
now start selling toothpaste for babies because people will associate the first
product with the new one.

Cognitive learning theories

● Observational learning
○ We learn about products and events by observing other people's actions and
the reinforcement they obtain from those actions.
● Modeling
○ Imitating the behavior of another person who we perceive as important.
(family, friends, influencers or famous people. etc.)
○ Powerful form of learning as humans have a strong tendency to imitate
others.

Memory
● Memory is very important in marketing as companies rely on consumer to:
○ Remember an advertisement
○ Remember a product they liked
 ○ Remember a brand to which they are loyal
● Consumers use internal (brain, own memory) and external (shopping list, photos)
memories.
● Memory process
○ Encoding → codificar, process of translating the information into codes that
then we store in our brains.
■ When we codify new information into our memory.
■ It’s easier to retain new information when we associate it with data
already in our memory. (example: you’re in a store and find a new
product. It is easier to remember it if we can associate it with
something you already have in our mind. Everything it is easier to
remember with something you already know).
■ Companies frequently use celebrities to facilitate the encoding of their
products.
○ Storage
■ Information is stored in associative networks of related data that are
constructed little by little. (our memories are “redes” connected
between each other).
○ Retrieval → recuperar
■ The process of recovering information.
■ Our brain has so much information that sometimes is difficult to recall
it.
■ Marketing messages that activate our memory can be very helpful in
some situations.
■ Recognition (“reconocer”) vs. Recall (you have to think about products
that you have in your brain, in spanish “recordar”).

TOPIC 5: MOTIVATION AND AFFECT

The motivation process

● Motivation
○ The process and reasons that lead people to behave in a certain way.
○ Once the consumer realizes that she has a need, a state of tension appears
that motivates her to satisfy that need.
○ Needs can be utilitarian (basic needs) and hedonic (pleasant and unpleasant
situations, products deeply related with emotions or pleasure, for example,
something that reminds you about your childhood).
● Motivational direction and strength
○ Motivates push consumers towards certain behaviors in order to alleviate the
tension.
○ Motivations can be driven by biological (body needs, like hunger or need of
sleep) or cognitive (they come from the mind, like to eat in a good/special
restaurant) factors.
○ The magnitude of the tension determines the urgency the consumer has to
reduce it.
● Different people have different motivations: save money for my summer trip with my
friends.
 ● Motivational conflicts
○ Consumers might experience contradictory motives which then will influence
their buying. (example: you have the motivations to save money but you have
the motivation to go to dinner with your friends).
● Types of motivational conflict
○ Approach-approach conflict
■ Choosing between two desirable alternatives, when it comes to make
the decisions we tend to think about the good things of the product
(example: dark chocolate or white chocolate, you have the need of
entertainment and have to choose between disneyland paris or
orlando).
○ Approach-avoidance conflict
■ Want to buy a product but also avoid some of its negative
consequences (example: to eat chocolate but it's not good for your
health, you are partying and want to get another drink but you also
want to avoid a hangover in the morning).
○ Avoidance-avoidance conflict
■ Choosing between two undesirable alternatives, when it comes to
making a decision we tend to focus on the bad things(example: your
car broke and you have to choose between repairing it or buying a
new one).
● Sales promotions (activities which you do in your store to influence the sell of your
products) impact stronger hedonic than utilitarian purchases:
○ Utilitarian products are a basic need so you have to buy them either way.
○ When we have a price discount we have an additional excuse to buy hedonic
products, for example, you are gonna buy milk either with a discount or not. If
there's a discount on chocolate you have an excuse to justify yourself.
○ Sensory marketing can be a type of sales promotion, because you influence
the consumer to buy hedonic products which are bought usually by impulse.
Affect (related with feelings)
● Affect has a strong impact on consumer evaluations and decisions:
○ Can be negative or positive and vary (change) in intensity.
○ Frequently operates in an unconscious way.
○ Provides information to the consumer about products, events, people and
places (based on your past experiences and the feelings you feel due to that,
you can tell if a product is good or bad, emotions allows us to come to a
conclusion).
● Types of affective responses
○ Evaluations
■ Reaction to events and products not accompanied by high levels of
arousal (starting to feel and emotion, example: they ask if you liked a
bottle of water an you answer it’s good not to bad, there's no emotions
in your response).
○ Moods
■ Temporary affective states that last for some time.
■ Diffus (“difuso”) and not necessarily linked to a particular event.
○ Emotions
 ■ More intense and short-lived than moods, frequently triggered by
some particular events. The balance of emotions is: positive or
negative.
■ Example (6 basic emotions): happiness, sadness, anger, fear, disgust,
surprise.

*System 1: is the brain we share with animals and therefore it’s more related with emotions

Consumer involvement
● Involvement
○ The degree of connection between a person and an object.
● Level of involvement depends on the consumer, product and situation.
● Involvement reflects the consumer motivation to process information about the
product.
○ Higher level of involvement when the product is expensive or has some risk
behind.
● Types of involvement:
○ Product involvement: is a consumer’s level of interest in a particular product.
○ Message involvement : influence or motivation to pay attention to what they
tell us.
○ Situation involvement: describe engagement with a store, web site or a
location where people consume a product or service.

TOPIC 6: PERSONALITY, LIFESTYLE AND VALUES

Personality
● Personality
○ A person’s psychological characteristics.
○ Influences her behavior and how she responds to the environment.
○ Personality stabilizes once a person reaches her 30s.
● Freudian Theory
○ Human behavior is shaped unconsciously by sexual desire.
○ Products have sexual symbolism.
● Neo-freudian theories:
○ Give more importance to how people relate with others than to their sexual
motivations.
○ People can be more prone (inclinadas, en un sentido de personalidad, te decantas más
por una cosa o por otra) towards (a) others, {example: viaje en grupo, board
game} (b) away from others, {example: smartphone, Wi/PS5, book} or (c)
against others {example: experience to fight in a ring, boxing class, they like
competitive sports} (Karen Horney).
○ Cumulative experiences of past generations shape today’s ideas and
behaviors (Carl Jung).
● Trait theory (teoría de los rasgos)
○ People have their own personality traits which influence their behavior.
● Big five
○ The approach most widely used to measure personality traits.
○ Consists in a set of 5 dimensions:
 ■ Openness to experience: how much a person is open to do things in
new ways.
■ Conscientiousness: the level of organization and structure a person
needs.
■ Extroversion: how much a person likes to interact with others.
■ Agreeableness: level of cooperation and empathy towards others.
■ Neuroticism: how well a person copes with stress.

Brand personality
● Brand personality
○ The traits consumers attribute to a product as if it were a product.
○ Consumers rely on external characteristics such as the product design,
packaging and brand name to infer the brand personality.
● Brand storytelling
○ Creating a story to describe the brand.
○ Humans need stories and BS (brand storytelling) allows consumers to involve
more strongly with the brand.
○ Example; the underdog brand biography describes the brand’s humble origins
and how it struggled to reach success, aims to have consumers with similar
stories identified with the brand.
● Anthropomorphism
○ Attribute human characteristics to a brand, example: “Don limpio”, people
create this type of characters because human beings are more likely to
connect with these humanice characters.
○ We tend to prefer products similar to ourselves.

Lifestyle and consumer identity + Psychographics

● People with similar demographic characteristics can have very different consumption
patterns due to different lifestyles.
● Lifestyle
○ How a person chooses to spend her time and money.
○ Is a statement about how we want others to perceive us.
○ Each lifestyle subculture has its own norms, vocabulary and product
insignias.
● Psychographics segmentation
○ Based on lifestyle and opinions.
○ Allows to understand better the consumer:
■ Offer messages and products that connect more strongly with her.
● Buyer persona
○ Based on real data about your consumers, the company creates an imaginary
person who represents its ideal customer.
○ Facilitates to connect with the target customers.
● Consumption constellation
○ Many products seem to “go together” because a group of similar people tend
to buy them.
○ Big Data and AI help companies to predict and suggest what consumers will
choose.
■ Amazon: “Customers who bought that book also bought…”
Values
● Values
○ Beliefs about how to live.
■ Example: freedom, materialism, family integrity, etc.
○ Though some values are universal, different cultures prioritize them
differently.
● Core values
○ The most important and distinctive values of a particular culture.
○ Evolve over time.
● Personal values
○ A person’s belief system is a function of cultural, social and individual forces.
○ Values play an important role in a person’s consumption pattern.

TOPIC 7: DECISION MAKING

Introduction to decision making

● Consumer hyperchoice
○ Nowadays consumers need to make many decisions, which drains their
psychological energy.
● The effort we put on our decisions varies depending on their importance
○ E.g. Car vs. chocolate
○ Decision makers have a repertoire of strategies to use in different situations.
● Types of Consumer Decision Making:
○ Cognitive: Deliberate, rational, sequential.
○ Habitual: Intuitive, unconscious, automatic.
○ Affective: Emotional, instantaneous.

Cognitive decision making

● Rational decision making
○ Traditional perspective.
○ Decision makers carefully integrate as much information as possible,
weighting the pluses and minuses of each alternative, and finally select the
best one. (we use this type of decision making when we want to buy products
like cars, houses, typically the most expensive ones, we call these types of
products high involvement products).
○ Used essentially in high involvement situations/products (example: financial
products, cars, etc.).
○ In these situations, markers should supply customers with a lot of relevant
information.

Stages in consumer decisions making

● Problem recognition:
○ Occurs when the consumer experiences a significant difference between her
current and desired state, “you notice you need something”.
○ Example: creating gap between ideal and actual (down), you have a sweater
for three months and now it is used, so you have the need to buy a new one,
your actual state has gone down but the ideal stays the same creating a gap
between them.
 ○ Companies do not create needs, they manipulate our perception of ideal
state, and the gap between ideal and actual (up) state increases.

● Information search:
○ We search more when the purchase is important, it is easy to obtain
information or we enjoy learning about the category.
○ The type and quantity of information searched depends on the experience of
the consumer. Neither newbies or experts search for a lot of information, the
ones in the middle are the ones that search for the most information, they
already know how to process information about the subject but they also
know they need to learn more about it. The amount of search for newbies and
experts is the same but the type of search is different.
○ The Internet offers an infinite supply of information, though consumers’ use of
it is limited and biased.

● Evaluation of alternatives
○ Typically not easy, much of the effort consumers put in the decisions comes at
this stage.
○ The number of alternatives can be enormous and daunting.
○ Evoked set: are all the brands you recall about the subject, all the ones that
you know and come to your mind. An expert has the longest evoked set about
the subject they are experts about. If companies want to be on the evoked set
of customers they need to be known through ads and publicity.
○ Consideration set: the brands or products left after a person has narrowed
down their choices based on their own personal screening criteria, such as
previous exposure, brand awareness, price, and more. If companies want to
be on the consideration set of consumers they need to fit with their needs.

● Product choice
○ Selecting what the consumer believes is the best alternative for her.
○ Often we assume more features the better, though when the consumer takes
the products home realizes the importance of simplicity.

● Postpurchase evaluation
○ After consuming the product, we assess if it met our expectations, and decide
whether to buy it or not.
○ Not just consumers evaluate companies, companies also evaluate consumers
(example: airbnb, cabify).
Additional concepts
● Neuromarketing
○ Using fMRI (a brain scanning device) to track the brain activity of consumers
when exposed to products and commercial messages in order to identify the
most effective ones.
○ The brain activity provides a more accurate image of the consumers feelings
and responses towards the marketing element than the questionnaires’
answers.
● Product categorization
○ The way we categorize products influences greatly how we perceive and
compare them, and consequently, their buying likelihood.
○ “Category exemplars” (example: coca-cola, chupa chups, typex, kleenex,etc.)
have a huge influence on the way consumers evaluate the category and its
several alternatives. Products that are so important that give name to the
brand.
● Different decision rules
○ Compensatory: evaluates several attributes and allows the stronger to
compensate for the weaker attribute (example: you want to buy an Audi, the
weak attribute is the price, the strong ones are power or prestige).
○ Noncompensatory:
■ Lexicographic rule (consumer chose the brand that has the highest
level in the most important attribute, you only care about one attribute
example: in a car could be speed, so you only base your criteria for
choosing on which is the fastest one).
■ Elimination by aspect rule (example: you want a laptop, all laptops that
cost more than 1.000 are automatically eliminated from the list) you
eliminate what doesn't fit your criteria.
■ Conjunctive rule, means you chose a product as long as it meets all
the criteria that are important for you. (example: for a house it could be
location, number of bedrooms, garden, price, etc. you would buy the
one that has all the criteria).

Habitual decision making

● Bounded rationality (Herbert Simon)
○ Typically, consumers do not evaluate all attributes of all alternatives in the
market.
■ This happens because consumers face many decisions daily and their
time and energy is not infinite.
○ Consumers usually use a Satisficing Solution:
■ They search until finding a good enough alternative.
● Habitual decision making
○ For frequent decisions consumers choose almost automatically and with low
effort.
○ Though the outcome i nos always the best, it’s very efficient.
● Heuristics (Rules-of-Thumb that work as mental shortcuts)
○ Covariation (example: you assume a clean fat is correlated with the flat being
in good state).
○ Country of origin (example: buying a German car you assume they work well).
 ○ Familiar brand names (example: in a supermarket you want to buy powder
milk for you first child you will buy the brand that sound familiar).
○ Higher price (example: you don’t know which car to buy but want quality you
assume the one with higher price it’s the best).

Priming and nudging

● There are a multitude of factors that bias (influir de forma no objetiva) our decisions
unconsciously.
● Framing
○ The way a product is described can influence our perception of it, and related
decisions.
● Prime
○ A stimulus that makes people focus on specific aspects, which influence their
decision. (example: in class they were talking about summer, sand, beach
and later you discuss with you family the destiny of family vacation you will be
voting for a beachy destiny).
● Examples
○ Prospect theory: an option's value is based on its comparison with others;
loss aversion (you will be more unhappy for losing 10€, than happy for
founding 10€, losses generate a more unsatisfying feeling than a winning of
the same amount).
○ Sunk-cost: if we’ve paid for something, we’re more reluctant to waste it.
○ Mental accounting: we assign out cost/benefits to specific categories created
by us artificially.
○ Default bias: we are more likely to comply with a requirement than to make
the effort to don’t comply. (example: when cookies show on your laptop every
time you enter a website, you probably just accept all, instead of reading them
and just accepting the ones you think make sense).

TOPIC 8: BUYING, USING AND DISPOSING

Consumption Situation
● Consumption Situation
○ The context in which a product is consumed.
● Many factors influence the satisfaction with the consumption situation:
○ Temporal factors: season, time of the day, queuing, etc.
○ Physical environment: décor, organization and cleaning, odor, temperature,
sound, etc.
○ Social context: type and quantity of co-consumers (people that are
buying/consuming at the same time you are).

Shopping experience
● Shopping experience:
○ The way the consumer acquires the products she needs.
○ Can be performed for utilitarian or hedonic reasons.
● Hedonic reason behind the shopping experience:
○ Social experience (going shopping with friends)
○ Sharing of common interests
 ○ Status
○ The thrill of the hunt
● Cash vs. digital currency.
● The shopping experience is radically different if the consumer is buying online or in a
brick-and mortar store.
○ Online:
■ Available 24/7 everywhere.
■ Wider assortment (more options).
■ Lacks the social component of shopping.
○ Brick-and-mortar (tienda física):
■ Physical stores are not dead but need to reinvent themselves.
■ From selling products to offer entertainment:
● Enjoying the shopping experience leads consumers to stay
longer in the store (and spend more money).
■ Mobile shopping apps and in-store tech.
■ Salespeople expertise and trust make them key factor in shopping.

Ownership and the sharing economy

● Sharing economy or collaborative economy:
○ Nowadays many people prefer to share rather than own a product.
○ Facilitated by the democratization of the internet and smartphones.
○ Stronger among young consumers. (economic motivation, more use of the
internet, more open to new experiences, environmental motivation).
● Factors:
○ Economic motivations are important but not exclusive:
■ Buyers can obtain products with lower prices.
■ Sellers/providers can have an additional source of revenue from an
asset they don’t use.
○ Environmental and minimalistic concerns.
○ Allows to access more products and services.

Postpurchase and product disposal

● Product disposal:
○ Final stage and consumption, when the consumer stops using the product
○ Damages heavily the environment.
● Increasing number of customers care about what happens to their products once
they no longer use them.
○ Many companies are taking responsibility at this stage and communicate in
the market.
● Possible actions:
○ Recycling
○ Reusing and second-hand markets
TOPIC 9: INCOME AND SOCIAL CLASS

Income and consumer identity

● Household income:
○ The money a household has to face its daily expenditures and long term
commitments.
● Consumer demand depends on both ability (rich vs poor) and willingness to buy
(tightwads: “tacaño”, a person that has the money but doesn't want to spend it vs
spendthrifts: “derrochador”, you want to spend all the money you have).
● Our expectations about the future affect our current spending:
○ Economy health: if the expectations for the future are good people are going
to spend more money, if the expectations are bad people are going to save up
money and not spend that much money.
○ Consumer’s own financial situation.
● How and in which product a consumer spends money changes along her life (young
people spend money on traveling or partying, instead older people spend it on the
house, school for their children, etc.).
● Income inequality:
○ The extent to which resources are distributed unevenly within a population.
○ Inequality has been rising in the last decades.
○ Affects the consumption pattern (in a society with a middle class, people are
going to spend more money, in an unequal society poor people spend money
on lottery and rich people spend it on luxury).
○ Example: unequal society: United States, South Africa; equal society:
Sweden, Norway.
● High-Income consumers:
○ Are not homogenous: old money (born in a rich family, you inherited) vs
nouveau riche (you become rich in life, for example by creating a company).
● The bottom of the pyramid:
○ Though they possess less resources, they still have needs to fulfill and
represent a huge segment.
● Social mobility:
○ The movement of a persona from a social class to another one: downwards
vs upward mobility.
○ Stronger upward mobility in big towns, areas with more two-parents
households, and better education.

Social class and consumer identity

● All societies have some type of hierarchical structure.
● Social class:
○ Describes the overall rank of people in a society.
○ Involves more than income, it is also a matter of lifestyle.
○ People in the same social class tend to have similar occupations, lifestyles,
tastes and values.
● People socialize mainly with those from the same social class:
○ Buy similar products.
● Not easy to measure (subjective and sensitive issue).
○ Social class structure (W. Lloyd Warner, 1941):
 ■ Upper (upper upper, lower upper).
■ Middle (upper middle, lower middle).
■ Lower (upper lower, lower lower).

Status symbols and social capital

● People tend to evaluate themselves relatively to others.
● Status symbols:
○ Products and services that communicate wealth and prestige to others.
○ A major motivation to buy these products is not to enjoy them but to show
others we can afford them.
○ Purchased more by consumers with a higher need to demonstrate their
status.
○ Conspicuous waste: show others that we have so many resources that we
can waste them.
● Codes:
○ A “secret” meaning about something that only people from the same group
can understand.
○ Good manners and etiquette.
○ Art taste (Pierre Bourdieu): people inherited the social class of their parents.
● Social capital:
○ Having access to an exclusive network of people who provide you some
benefits.
○ Belonging to these circles offers prestige.
○ While some people do everything to enter, some other people work hard to
don’t let others get in.

TOPIC 10: CULTURE

Cultural system
● Culture:
○ The shared meanings, rituals, norms and traditions among the members of an
organization or society.
○ Includes abstract ideas (values, ethics) and material objects (clothes, food,
art).
○ Determine priorities and its effects on consumption is powerful but often
difficult to grasp.
● Culture is not static, it evolves:
○ A style begins as a risky or unique statement by a relatively small group of
people and then spreads to others who admire it until too many people use it
and it’s no longer attractive.
○ Advertising and fashion industries play a key role in spreading new styles.
○ Culture production system: the set of individuals and organizations that create
and market a cultural product (ocio: arte, cine, libros, conciertos, etc.).
Cultural stories and ceremonies
● Every culture develops its own stories and ceremonies that help its members
understand the world.
● Myth:
○ A story symbolic elements that represent a culture’s ideals.
○ Shared by most members, offers them guidelines to cope with the challenges
(“moraleja”).
○ Societies and even some organizations have their own myths.
○ Advertisements sometimes represent mythic themes.
● Rituals:
○ Ceremonies with a symbolic meaning that occur to mark a specific occasion
(example: when you finish college you have the ritual of graduation,
Christmas every end of December you get together with family and exchange
gifts).
○ Intent to affirm membership to a group and foster the creation of bonds.
○ The consumption of some products can also be ritual (e.g. morning coffee
with colleagues); typically lead consumers to be more attached to these
products and enjoy them more.

Sacred and profane consumption

● Sacred consumption:
○ Products or events consumed by a persona that she considers to be very
special.
○ Not necessarily religious.
○ Can refer to dams such as places, people, events and products. (example: a
pen you've been using since you started high school until graduating from
university).
● Desacralization
○ When a consumer no longer considers a sacred product to be special.
● Profane consumption:
○ The consumption of products/events that we consider normal or from
everyday.

The diffusion of innovations and the fashion system

● Innovation:
○ Any products that consumers perceive as new.
● Diffusion of innovations:
○ The process whereby innovations spread through a population.
○ The explosion of social media makes diffusion much quicker nowadays.
○ Innovation diffusion depends not only on the characteristics of the product but
also on the cultural values of a society and in particular its willingness to try
new things.
● Different acceptance cycles: fads, fashion and classics

- Classic: adopted by many members of the

population and for a long period of time, examples:
car, a business suit, hat, etc.
 -Fads:“tendencia”, something that appears and grows quickly but also disappears
quickly.
-Fashion: scooter, etc.

Global consumer culture

● West culture, and US in particular, has a strong influence around the world:
○ Examples: movies, music, art, fashion, technology, brand, and consumption
patterns.
● Strategies to sell to different cultures:
○ Standardized strategy: sees the world as homogenous, uses the same
approach throughout the world to benefit from economies of scale. Example:
apple, the products are the same, the only things that could change are the
price or the keyboard.
○ Localized strategies: perceives each culture as unique, tailors its approach to
the sensibilities of each culture in order to create a stronger relation with each
of them. Example: McDonald’s has different products in each country
depending on the culture and typical food.
○ Combination of both and standardized and localized strategies.
● Does global marketing work?
Can we sell the same product all around the world since there are so many and
diverse cultures.
○ Countries can be very diverse: “Think global, act local” Partick Geddes and
Akio Morita.
○ Some customers from different countries share similar values and lifestyles
(example: affluent people or the youth due to the presence of the internet in
the life of young people): as a company you should focus on these niches.