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ovltoomeotol lofloeoces

Lhe markeLer assesses Lhe lmpacL of each of Lhe below faceLs of Lhe envlronmenL on Lhe flrm
roups and famllles
cross culLural lssues
9ersonal lnfluences ulffuslon of lnnovaLlons
reulaLory envlronmenL
Manaerlal AppllcaLlons Analysls (9MS)
lve facLors Lo conslder when usln consumer behavlor prlnclples Lo develop manaerlal
sLraLey are
poslLlonln and dlfferenLlaLlon
envlronmenLal analysls
markeLln research
markeLln mlx
Cu|ture @he sum LoLal of learned bellefs values and cusLoms LhaL serve Lo reulaLe Lhe consumer
behavlor of members of a parLlcular socleLy
Cu|ture offers order d|rect|on and gu|dance |n a|| phases of human prob|em so|v|ng When to eat
Where to eat What to eat for each mea| What to serve guests at a d|nner party p|cn|c or wedd|ng
ulvesLmenL rlLual @hese rlLuals lnvolves Lwo ways one when a lndlvldual purchased a ood LhaL has
been prevlously owned such as a house or car Lhe rlLual ls used Lo erase Lhe meanln assoclaLed wlLh
Lhe prevlous owner @he second dlvesLmenL rlLual Lakes place when Lhe lndlvldual ls abouL Lo dlspense
wlLh a ood elLher by lvln lL away or sellln lL An aLLempL wlll be made Lo erase Lhe meanln LhaL has
been lnvesLed ln Lhe ood by Lhe assoclaLlon
Issues |n Cu|ture
nculLuraLlon and acculLuraLlon
anuae and symbols
Sharln of CulLure
ncu|turat|on ls Lhe process by whlch a person learns Lhe requlremenLs of Lhe culLure by whlch he or
she ls surrounded and acqulres values and behavlours LhaL are approprlaLe or necessary ln LhaL culLure
ocoltototloo ls someLlmes referred Lo as acculLuraLlon a word whlch recenLly has been used Lo more
dlsLlncLlvely refer only Lo exchanes of culLural feaLures wlLh foreln culLures noLe LhaL Lhls ls a recenL
developmenL as acculLuraLlon ln some llLeraLures has Lhe same meanln as eocoltototloo
Cu|ture and Advert|s|ng
JlLh Lhe passae of Llme AdverLlsln have lncreaslnly Laken Lhe lead Lo soclallze readers or vlewers on
how Lo dress decoraLe Lhelr homes choose drlnks and food for parLles eLc Lhrouh varlous modes of
adverLlsln llke elecLronlc medla and prlnL medla
1he Measurement of Cu|ture
ConLenL Analysls
Consumer leldwork
value MeasuremenL lnsLrumenLs
Content Ana|ys|sA method for systemat|ca||y ana|yz|ng the content of verba| and]or p|ctor|a|
commun|cat|on 1he method |s frequent|y used to determ|ne preva|||ng soc|a| va|ues of a soc|ety
I|e|d Cbservat|onA cu|tura| measurement techn|que that takes p|ace w|th|n a natura| env|ronment
that focuses on observ|ng behav|or (somet|mes w|thout the sub[ects' awareness)
Character|st|cs of I|e|d Cbservat|on
1akes p|ace w|th|n a natura| env|ronment
9erformed somet|mes w|thout the sub[ect's awareness
Iocuses on observat|on of behav|or
9art|c|pantCbserverskesearchers who part|c|pate |n the env|ronment that they are study|ng w|thout
not|fy|ng those who are be|ng observed
vo/ue Meosurement 5urvey lnstruments
kokeach Va|ue Survey (kVS) A se|fadm|n|stered |nventory cons|st|ng of e|ghteen "term|na|"
va|ues (|e persona| goa|s) and e|ghteen "|nstrumenta|" va|ues (|e ways of reach|ng
persona| goa|s)
|st of Va|ues (CV) A va|ue measurement |nstrument that asks consumers to |dent|fy the|r
two most |mportant va|ues from a n|neva|ue ||st that |s based on the term|na| va|ues of the
kokeach Va|ue Survey
Va|ues and |festy|es (VAS) A va|ue measurement based on two categor|es se|fdef|n|t|on and

5ocio/ c/oss
1he d|v|s|on of members of a soc|ety |nto a h|erarchy of d|st|nct status c|asses so that members of
each c|ass have e|ther h|gher or |ower status than members of other c|asses
SLaLus ls frequenLly LhouhL of as Lhe relaLlve ranklns of members of each soclal class
5ocio/ comporison 1heory
sLaLes LhaL lndlvlduals compare Lhelr own possesslons aalnsL Lhose of oLhers Lo deLermlne Lhelr
relaLlve soclal sLandln
5totus consumption
@he process by whlch consumers acLlvely lncrease Lhelr soclal sLandln Lhrouh consplcuous
consumpLlon or possesslons
conspicuous consumption ls a Lerm used Lo descrlbe Lhe lovlsb speoJloq on oods and servlces acqulred
malnly for Lhe purpose of dlsplayln lncome or wealLh
Conven|ent Approaches to Soc|a| C|ass
Soc|a| status |s usua||y def|ned |n terms of one or more of the fo||ow|ng soc|oeconom|c var|ab|es
Iam||y Income
Cccupat|ona| Status
ducat|ona| Atta|nment
5ocio/ c/oss Meosurement/ueterminonts
5ubjective Meosures lndlvlduals are asked Lo esLlmaLe Lhelr own soclalclass poslLlons
eputotiono/ Meosures lnformanLs make [udmenLs concernln Lhe soclalclass membershlp of
oLhers wlLhln Lhe communlLy
bjective Meosures lndlvlduals answer speclflc socloeconomlc quesLlons and Lhen are caLeorlzed
accordln Lo answers
Cb[ect|ve Measures
S|ng|evar|ab|e |ndexes
Lher varlables
Compos|tevar|ab|e |ndexes
lndex of SLaLus CharacLerlsLlcs
Socloeconomlc SLaLus Score
Index of Status Character|st|cs (ISC)
A composlLe measure of soclal class LhaL comblnes occupaLlon source of lncome (noL amounL) house
Lype / dwellln area lnLo a slnle welhLed lndex of soclal class sLandlnv
@he lSC ls deLermlned for no one buL Lhe head of Lhe famlly All oLher
members of Lhe famlly who are unmarrled and llvln ln Lhe same house are asslned Lhe same soclal
Soc|oeconom|c Status Score (SS)
A mulLlvarlable soclal class measure used by Lhe unlLed SLaLes 8ureau of Lhe Census LhaL comblnes
occupaLlonal sLaLus famlly lncome and educaLlonal aLLalnmenL lnLo a slnle measure of soclal class
Soc|a|C|ass 9rof||es
1) 1n U99kU99k CASSCCUN1k CU8
2)1n CWkU99k CASSNW WA1n
1n U99kU99k CASSCCUN1k CU8
Small number of wellesLabllshed famllles
8elon Lo besL counLry clubs and sponsor ma[or charlLy evenLs
Serve as LrusLees for local collees and hosplLals
9romlnenL physlclans and lawyers
May be heads of ma[or flnanclal lnsLlLuLlons owners of ma[or lonesLabllshed flrms
AccusLomed Lo wealLh so do noL spend money consplcuously
1n CWkU99k CASSNW WA1n
noL qulLe accepLed by Lhe upper crusL of socleLy
epresenL new money"
Successful buslness execuLlve
Consplcuous users of Lhelr new wealLh
ave nelLher famlly sLaLus nor unusual wealLh
Career orlenLed
oun successful professlonals corporaLe manaers and buslness owners
MosL are collee raduaLes many wlLh advanced derees
AcLlve ln professlonal communlLy and soclal acLlvlLles
ave a keen lnLeresL ln obLalnln Lhe beLLer Lhlns ln llfe"
@helr homes serve as symbols of Lhelr achlevemenLs
ConsumpLlon ls ofLen consplcuous
very chlld orlenLed
9rlmary nonmanaerlal whlLecollar workers and hlhly pald bluecollar workers
JanL Lo achleve respecLablllLy" and be accepLed as ood clLlzens
JanL Lhelr chlldren Lo be well behaved
9refer a neaL and clean appearance and Lend Lo avold faddlsh or hlhlysLyled cloLhln
ConsLlLuLe a ma[or markeL for dolLyourself producLs
@he laresL soclalclass semenL
Solldly bluecollar
SLrlve for securlLy
vlew work as a means Lo buy" en[oymenL
JanL chlldren Lo behave properly
lh wae earners ln Lhls roup may spend lmpulslvely
lnLeresLed ln lLems LhaL enhance lelsure Llme (e @v seLs)
usbands Lyplcally have a sLron macho" selflmae
Males are sporLs fans llke smokln drlnkln
9oorly educaLed unskllled laborers
fLen ouL of work
Chlldren are ofLen poorly LreaLed
@end Lo llve a dayLoday exlsLence
consumer 8ehovior 5ocio/ c/oss
CloLhln ashlon and Shoppln
@he 9ursulL of elsure
Savln Spendln and CredlL
Soclal Class CommunlcaLlon
keference Group Iam||y Inf|uences
Group1wo or more |nd|v|dua|s who share a set of norms va|ues or be||efs and have certa|n |mp||c|t|y
or exp||c|t|y def|ned re|at|onsh|ps to one another such that the|r behav|ors are |nterdependent
keference group a roup whose presumed perspecLlves or values are beln used by an lndlvldual as
Lhe basls for hls or her currenL behavlor
D|rect keference Groups
A person or roup LhaL serves as a polnL of comparlson (or reference) for an lndlvldual ln Lhe formaLlon
of elLher eneral or speclflc values aLLlLudes or behavlor
8road Categor|es of keference Groups
normaLlve eference Croups or 9rlmary eference Croups
ComparaLlve eference Croups or Secondary eference Croups
A normaLlve cllque or reference roup ls ofLen Lhe prlmary source of soclal lnLeracLlon for Lhe members
of Lhe cllque whlch can affecL Lhe values and bellefs of an lndlvldual
@he comparaLlve cllque or reference roup ls a sLandard of comparlson ln whlch a cllque can
exlsL ln Lhe workplace ln a communlLy ln Lhe classroom ln a buslness or any oLher area of soclal
Ind|rect keference Groups
lndlvlduals or roups wlLh whom a person ldenLlfles buL does noL have dlrecL faceLoface conLacL such
as movle sLars sporLs heroes pollLlcal leaders or @v personallLles
Conform|ty ls Lhe process by whlch an lndlvlduals aLLlLudes bellefs and behavlors are lnfluenced by
oLher people @he need for conformlLy ls Lhe deslre Lo o alon wlLh Lhe norms of a roup of people so
you wlll be accepLed as an lnroup person (and noL re[ecLed as an ouLroup undeslrable person)
Se|ected Consumerke|ated keference Groups
rlendshlp roups
Shoppln roups
Jork roups
vlrLual roups or communlLles
Consumer courLs
A v|rtua| commun|ty ecommun|ty or on||ne commun|ty ls a roup of people LhaL prlmarlly lnLeracL vla
communlcaLlon medla such as newsleLLers Lelephone emall lnLerneL soclal neLwork servlce or lnsLanL
messaes raLher Lhan face Lo face for soclal professlonal educaLlonal or oLher purposes
uyadlc xchane exchane of vlews beLween members of a roup

omlly lofloeoces
nouseho|ds A shared res|dence and common housekeep|ng arrangement %uropeon community)
amlly ouseholds
Marrled couple
nuclear famlly
xLended famlly
nonamlly ouseholds
rlends/ oommaLes
ousehold e
lndla !olnL famlly
Canada nuclear famlly
@halland xLended famlly
uSA reedom orlenLed le noL keen on famlly culLure
Consumer Soc|a||zat|on@he process by whlch chlldren acqulre Lhe skllls knowlede and aLLlLudes
necessary Lo funcLlon as consumers
Iam||y trends
W allln numbers of marrlae
W lncreasln number of dlvorces
W lncreased lncldence of remarrlae
W Jomen wanL smaller famllles
W SLeady lncrease ln Lhe number of unmarrled adulLs and one person households
W @ransformaLlon of Lhe nuclear famlly Lo resemble Lhe old fashloned exLended famlly
ffects of fam||y structure on consumpt|on
A famlly's needs and expendlLures are affecLed by Lhe followln facLors
W Lhe number of people ln Lhe famlly
W aes of Lhose ln Lhe famlly
Lhe number of adulLs employed ln Lhe famlly
1he fam||y ||fe cyc|e (IC)
@he C comblnes Lrends ln lncome and famlly composlLlon wlLh Lhe chanes ln demands placed upon
Lhls lncome
As people row older Lhelr preferences for producLs and servlces chane
AL Lhe same Llme lncome levels Lend Lo rlse (unLll reLlremenL)
A llfe cycle approach assumes LhaL plvoLal evenLs alLer role relaLlonshlps and Lrler new sLaes
of llfe whlch modlfy our prlorlLles

nouseho|d dec|s|ons
W ooseosool Jeclsloos where Lhe famlly roup arees on Lhe deslred purchase dlfferln only ln
Lerms of how lL wlll be achleved
ccommoJotlve Jeclsloos where famlly members have dlfferenL preferences or prlorlLles and cannoL
aree on a purchase LhaL wlll saLlsfy Lhe mlnlmum expecLaLlons of all lnvolved

D|ffus|on of |nnovat|on
looovotloo any producL or servlce LhaL ls percelved Lo be new by consumers
ulffosloo of looovotloo Lhe process where a new producL/servlce or ldea ls accepLed and spreads
Lhrouh Lhe populaLlon
Consumers' declslon Lo accepL and adopL someLhln new depends on Lhelr personal
characLerlsLlcs and Lhe characLerlsLlcs of Lhe new lLem

9ersono/ lnf/uences
Consumer behavlour ls a funcLlon of
lnLerpersonal lnfluences 9ersonal lnfluences nvlronmenL Je are all lnfluenced by Lhe
envlronmenL alLhouh we all don'L behave Lhe same wa
lnLerpersonal lnfluences refers Lo socleLal lnfluences on consumer behavlour
@hese comprlses culLural subculLure reference roups soclal class famlly
9ersono/ lnf/uences
needs wanLs moLlves
Maslows Lheory
9ercepLlon Asslnln meanln
ALLlLudes earned Lendencles Lo respond
earnln 9rocess LhaL creaLes real or poLenLlal chanes ln behavlour
Se|f Concept What about you?
9ower of lndlvlduals Lo conLrol Lhe purchasln declslons of oLhers 9ersonal lnfluence can be elLher
exLernal or lnLernal xLernal personal lnfluence lnvolves soclal lnLeracLlon beLween Lwo or more people
such as a nelhbor a moLher a faLher and a chlld or example a moLher mlhL seek advlce from a
nelhbor abouL a producL and convey Lhls lnformaLlon Lo her famlly
lnLernal personal lnfluence occurs when declslons are lnfluenced by menLal processes LhaL have Lo do
wlLh oLher people or roups or example a Leenaer may purchase a record album because he wanLs
Lo be percelved as beln wlLh lL Lo hls frlends ln boLh cases ldenLlfyln personal lnfluences ln a LareL
markeL and Lurnln Lhese lnfluences lnLo a poslLlve force ls lmporLanL Lo adverLlsers because faceLo
face communlcaLlon frequenLly has more lmpacL Lhan nonpersonal adverLlsln ln deLermlnln brand

Consumer know|edge
Importance of consumer know|edge
JhaL we know or don'L know sLronly lnfluences our declslonmakln processes
lL affecLs how declslons are made
lL may deLermlne Lhe flnal declslon lLself
knowlede abouL a brand's assoc|at|ons (llnkaes ln memory beLween Lhe brand and oLher concepLs)
can affecL consumer behavlour ln many ways

knowlede shapes lnferences abouL unknown producL aLLrlbuLes usln known producL aLLrlbuLes
knowlede abouL compeLlLors' prlces can deLermlne consumer accepLance of a company's prlce
knowlede can lnfluence consumer response Lo salespeople
1ypes of consumer know|edge
9roducL knowlede
9urchase knowlede
ConsumpLlon and usae knowlede
9ersuaslon knowlede
9roduct know|edge
epresenLs lnformaLlon sLored ln consumers' memory abouL producLs
Can be dlvlded lnLo product category know|edge (le knowlede abouL a eneral producL caLeory) and
brand know|edge
(le knowlede abouL a brand ln Lhe producL caLeory)
9roducL knowlede
9roduct nov|ces possess very slmply levels of producL caLeory knowlede
9roduct experts possess vasL amounLs of producL caLeory knowlede
8rand knowlede
JheLher Lhe consumer ls aware of Lhe brand or noL ls Lhe mosL fundamenLal aspecL of brand
9urchase know|edge
ncompasses Lhe varlous pleces of lnformaLlon consumers possess abouL buyln producLs
lncludes lnformaLlon abouL Lhe producL's prlce where lL can be purchased and wheLher lL can be
purchased less expenslvely laLer
ow much does lL cosL?
knowlede abouL Lyplcal rane of prlces for a producL helps consumer evaluaLe falrness of Lhe
prlce of a parLlcular brand
8uslnesses are concerned abouL Lhe accuracy of consumers' prlce knowlede and whaL
consumers know abouL Lhelr compeLlLors' prlces (re|at|ve pr|ce know|edge)
Consumpt|on and usage know|edge
ncompasses Lhe lnformaLlon ln memory abouL how a producL can be consumed and whaL ls
requlred Lo acLually use lL
Consumers are unllkely Lo buy a producL when Lhey lack lnformaLlon abouL how Lo use lL
SomeLlmes consumer have lncompleLe lnformaLlon abouL dlfferenL ways a producL can be
Care musL be Laken ln selecLln new uses for an exlsLln producL so noL Lo lower lLs appeal
9ersuas|on know|edge
lnformaLlon abouL whaL consumers know abouL Lhe oals and LacLlcs of Lhose Lryln Lo persuade
9ersuaslon knowlede lnfluences how consumers respond Lo persuaslon aLLempLs
knowlede abouL a parLlcular LacLlc may ellmlnaLe lLs effecLlveness
A person's undersLandln of one's own menLal processes
Can Lhe consumer accuraLely assess and reporL Lhe lmporLance of producL aLLrlbuLes used ln Lhe
declslon process?
Companles are beLLer off relyln on Lhe resulLs of sLaLlsLlcal models Lhan Lhose reporLed by
Sources of consumer know|edge
9ersonal versus lmpersonal
8uslness versus nonbuslness conLrolled
8uslness sources of knowlede are ofLen vlewed wlLh susplclon
Consumers have more falLh ln personal knowlede sources LhaL are noL conLrolled by buslnesses
ulfferln credlblllLy of sources
elaLlve lnfluence of producL sources depends on Lhe Lype of lnformaLlon conveyed
xperlence from buyln and consumln a producL
ulrecL experlence lncreases confldence ln knowlede and makes lL more llkely Lo be used ln
makln declslons
Companles may ad[usL Lhelr markeLln sLraLeles when LareLln consumers lackln dlrecL
experlence wlLh Lhe producL
Companles need Lo declde whlch source Lo use when dellverln Lhelr messaes
ssenLlal LhaL Lhe company monlLor whaL ls beln LransmlLLed Lo consumers abouL Lhem
8enef|ts of understand|ng consumer know|edge
Cauln poslLlonln success
8y examlnln a producL's lmae amon LareL consumers a company can deLermlne lLs success
ln achlevln Lhe des|red |mage amon consumers?
ldenLlfyln purchase barrlers
Can occur due Lo a lack of knowlede
know|edge gaps an absence of lnformaLlon ln memory
lrms need Lo ldenLlfy knowlede aps whlch undermlne producL purchase
knowlede aps may exlsL for new and exlsLln producLs
9urchase barrlers can occur due Lo lnaccuraLe knowlede (m|spercept|ons)
Can occur ln many areas lncludln knowlede of Lhe brand company producL or producL's
lxln mlspercepLlons requlres chanln how Lhe producL ls percelved
ulscoverln new uses
Consumers ofLen develop new ways of usln a producL
Companles may flnd LhaL Lhese new uses can be promoLed as a means of broadenln a
producL's appeal
Imp||cat|ons for pub||c po||cy
Safeuardln and lmprovln consumer welfare ls Lhe prlmary concern
9ollcles and lelslaLlon almed aL proLecLln Lhe unlnformed consumer
lncludes areas such as approprlaLe dlsclosure of lnformaLlon and educaLln consumers
AdverLlsln ls a pald form of nonpersonal presenLaLlon of oods or servlces by an ldenLlfled sponsor
Lo reach ouL Lo a maxlmum number of audlences
lndlvlduals and buslness flrms promoLe Lhelr oods servlces ldeas lssues corporaLe
messaes and people Lhrouh adverLlsemenLs
AdverLlsln messaes can be converLed Lo Lhe LareL audlence Lhrouh a wlde rane of
AdverLlsln ls LhaL form of markeLln communlcaLlon ln whlch a flrm dlrecLly pays a medla channel
Lo publlclze lLs producL
Common examples of Lhls lnclude @v and radlo adverLs blllboards brandln
sponsorshlp eLc
9a|d nonpersona| commun|cat|on transm|tted through outofstore mass med|a by an
|dent|f|ed sponsor
key aspects
9a|d form
Nonpersona| presentat|on
Cutofstore mass med|a
b[ecLlves of adverLlsln
A messae deslned Lo promoLe a producL/servlce or an ldea
lLs purpose ls Lo persuade people Lo buy producLs or servlces
8uslnesses use adverLlsln Lo aln new cusLomers and lncrease sales
AdverLlsln helps shape LasLes hablLs aLLlLudes and culLure of a counLry
lmporLance/Jhy ls adverLlsln so bl Loday?
are MarkeL
8eLLer means of LransporL and communlcaLlon
lncrease ln Lhe number of producLs and servlces
lncrease ln consumers demand
@o ellmlnaLe compeLlLors
AdvanLaes/8eneflLs of AdverLlsln
AdverLlsln creaLe awareness lnLeresL and deslre for producLs and servlces ln cusLomers Lo buy
AdverLlsln ls cosL efflclenL as adverLlsemenLs can reach vasL number of audlences
@he messae can be repeaLed several Llme
lL helps ln boosLln Lhe sales of Lhe company
lL supporLs Lhe acLlvlLles of Lhe dlsLrlbuLlon neLwork of Lhe flrm by creaLln demand and
encouraln purchase Lhrouh pull sLraLey
lL helps ln makln Lhe [ob of Lhe sales force easler by creaLln awareness amon poLenLlal
AdverLlsln also helps ln bulldln a sLron lmae of a producL or brand aparL from lncreasln Lhe
Consumer earn|ng
Importance of earn|ng
MarkeLers musL Leach consumers
where Lo buy
how Lo use
how Lo malnLaln
how Lo dlspose of producLs
earn|ng 1heor|es
8ehav|ora| 1heor|es @heorles based on Lhe premlse LhaL learnln Lakes place as Lhe resulL of
observable responses Lo exLernal sLlmull Also known as stlmolos tespoose tbeoty
Cogn|t|ve 1heor|es A Lheory of learnln based on menLal lnformaLlon processln ofLen ln
response Lo problem solvln
Consumer earn|ng
A process by whlch lndlvlduals acqulre Lhe purchase and consumpLlon knowlede
and experlence LhaL Lhey apply Lo fuLure relaLed behavlor
earn|ng 9rocesses
Intent|ona| learnln acqulred as a resulL of a careful search for lnformaLlon
Inc|denta| learnln acqulred by accldenL or wlLhouL much efforL
|ements of earn|ng 1heor|es
A poslLlve or neaLlve ouLcome LhaL lnfluences Lhe llkellhood LhaL a speclflc behavlor wlll be repeaLed ln
Lhe fuLure ln response Lo a parLlcular cue or sLlmulus
8ehav|ora| earn|ng 1heor|es
Classlcal CondlLlonln
lnsLrumenLal CondlLlonln
Modelln or bservaLlonal earnln
C|ass|ca| Cond|t|on|ngA behavloral learnln Lheory accordln Lo whlch a sLlmulus ls palred wlLh anoLher
sLlmulus LhaL ellclLs a known response LhaL serves Lo produce Lhe same response when used alone
Instrumenta| (Cperant) Cond|t|on|ngA behavloral Lheory of learnln based on a Lrlalanderror process
wlLh hablLs forced as Lhe resulL of poslLlve experlences (relnforcemenL) resulLln from cerLaln responses
or behavlors
Strateg|c App||cat|ons of C|ass|ca| Cond|t|on|ng
SLlmulus CenerallzaLlon
SLlmulus ulscrlmlnaLlon
epeLlLlon lncreases sLrenLh of assoclaLlons and slows foreLLln buL over Llme may resulL ln
oJvettlsloq weotoot
1hreen|t 1heory
epeLlLlon ls Lhe basls for Lhe ldea LhaL Lhree exposures Lo an ad are necessary for Lhe ad Lo be
@he number of acLual repeLlLlons Lo equal Lhree exposures ls ln quesLlon
St|mu|us Genera||zat|on
@he lnablllLy Lo percelve dlfferences beLween sllhLly dlsslmllar sLlmull
St|mu|us Genera||zat|on and Market|ng
9roducL lne orm and CaLeory xLenslons
amlly 8randln
Cenerallzln usae SlLuaLlons
St|mu|us D|scr|m|nat|on
@he ablllLy Lo selecL a speclflc sLlmulus from amon slmllar sLlmull because of percelved dlfferences
9oslLlonln ulfferenLlaLlon
Instrumenta| Cond|t|on|ng
Consumers learn by means of Lrlal and error process ln whlch some purchase behavlors resulL ln
more favorable ouLcomes (rewards) Lhan oLher purchase behavlors
A favorable experlence ls lnsLrumenLal ln Leachln Lhe lndlvldual Lo repeaL a speclflc behavlor
Instrumenta| Cond|t|on|ng and Market|ng
CusLomer SaLlsfacLlon (elnforcemenL)
elnforcemenL Schedules
Massed versus ulsLrlbuLed earnln
Cogn|t|ve earn|ng 1heory
olds LhaL Lhe klnd of learnln mosL characLerlsLlc of human belns ls problem solvln whlch enables
lndlvlduals Lo aln some conLrol over Lhelr envlronmenL

Invo|vement 1heory
A Lheory of consumer learnln whlch posLulaLes LhaL consumers enae ln a rane of lnformaLlon
processln acLlvlLy from exLenslve Lo llmlLed problem solvln dependln on Lhe relevance of Lhe

Consumer 8ehavlor nllne

@he comblnaLlon of old and new LradlLlonal approaches and new approaches based on new
Lechnololes aLher Lhan an elLher/or approach Lhe focus of converence ls on boLh @hls
oes beyond Lhe more narrow deflnlLlon of converence as a comblnaLlon of Lechnololes
Converence wlLhln Lhe consumer @he new posslblllLles creaLed by Lhe Lechnoloy and Lhe
endurln behavlors of human belns
More Lhan Lhe brlcksandcllcks buslness model
8aslc 9roposlLlons
1 @he new Lechnololes do noL replace Lhe old
2 9eople are complex reLalnln Lhe same endurln human needs even as Lhey adapL Lo new
Lechnololes and behavlors
3 Cs
MarkeLln challenes brouhL by Lhe CenLaur
1 CusLomerlzaLlon
2 vlrLual CommunlLles
3 Channel pLlons
4 CompeLlLlve value quaLlon
3 Cholce @ools
nllne 9opulaLlon
arly lnLerneL users eeky whlLe uys"
@he onllne populaLlon ls more llke Lhe offllne eneral populaLlon ulverse semenLs
noL based on demoraphlc facLors buL raLher on onllne experlences wlred llfesLyle
Llme pressure purchases from caLalos
MyLhs of Lhe @radlLlonal Consumer
1 nly Lhe ellLe wanL cusLomerlzaLlon
2 9rlce ls Lhe balL seL by Lhe seller
3 @he consumer ls on Lhe couch
4 ocaLlon locaLlon locaLlon
3 Consumers are lslands
6 CusLomers wlll accepL whaL you Lell Lhem
MyLhs of Lhe Cyberconsumer
1 9eople don'L wanL Lo be Lroubled wlLh shoppln
2 fflclency ls all LhaL maLLers
3 Consumers wanL Lo eL Lhe besL prlce
4 Consumers are elLher onllne or offllne
3 ase of vlslLln sLores wlll lead Lo more purchasln
6 @he lnLerneL ls lnherenLly fasclnaLln and aLLracLlve
uescrlbe nllne Consumers
A uemoraphlcs Ae ducaLlon lncome Cender
8 9ychoraphlcs elllous values Soclal vaules 9ersonallLy LralLs
C Scarborouh esearch (1999) Comblned demoraphlc daLa wlLh llfesLyle daLa

An lnvolvemenL ConLlnuum for Commerce
9hase l amlllarlLy wlLh Lhe lnLerneL and use of Lhe lnLerneL by employees
9hase ll @he lnLerneL used Lo communlcaLe feaLures and beneflLs of lLs producLs or servlces
9hase lll ConducL LransacLlonsrelaLed acLlvlLles onllne
9hase lv ronLend appllcaLlons aumenLed by backend appllcaLlons
ronLend appllcaLlons cusLomer servlce appllcaLlons
8ackend appllcaLlons sales lead daLabase orderprocessln sofLware

Cha||enges of the Internet S Cs
mployee rowLh raLe hlher ln Lhe lnfrasLrucLure semenL lower ln Lhe lnLermedlary
uecreased employee producLlvlLy due Lo Jeb surfln
@he lnLerneL as a dlsLrlbuLlon channel
lnfomedlarles Manae Lhe Lransmlsslon of dlsLrlbuLlonrelaLed lnformaLlon
ower search cosLs mpowered consumers
(MarkeL) CondlLlon
MarkeLln acLlvlLles more dlrecLly affecLed by Lhe envlronmenLal facLors such as
Lechnoloy and publlc pollcy
lnLerneL @lme ShorLer producL cycles uecreased producL dlfferenLlaLlon
SLraLelc alllances raLher Lhan zerosum approaches (e A @lme Jarner merer)
Same producL dlfferenL means of consumpLlon (e &@Au vs Merrlll ynch)

"e-Service is providing consumers with a superior experience with respect to the
interactive flow of information."
Rust and Kannan (2002) state that
"e-Service can be defined as the provision of service over electronic networks such as
the Internet"

followln are Lhe examples of a few e servlces
e-banking services, e-insurance services, e-Iinancial advise services, hotel e-booking services,
Ilight/railway e-ticket services, packaged tour e-services, real estate e-services and Iood take-
away e-services.
Evaluation oI Characterstics oI eservices-
e-Service Intangibility Process nature Inseparability Interaction
e-Banking services Yes Yes Yes or partial Mostly automated
e-Insurance services Yes Yes Partial Mostly automated
e-Financial advise services Yes Yes Yes or no Mostly automated
Hotel booking e-services Yes Yes Yes Automated or none
Flight/railway e-ticket services Yes Yes Yes Automated or none
Packaged tour e-services Yes Yes Yes Automated or none
Real estate e-services Yes Yes Yes or partial Mostly automated or
Food take-away e-services Yes Yes Yes Automated or none
Table 1. e-Services and characteristics examined

Se|f Serv|ce 1echno|og|es
SelfServlce @echnololes (SS@) are Lechnololcal lnLerfaces LhaL enable cusLomers Lo produce a
servlce lndependenL of dlrecL servlce employee lnvolvemenL
Classlfled Lhem lnLo Lhree caLeorles by 8lLner 8ooms and @eLreaulL
1) employee response Lo servlce dellvery fallure
2) employee response Lo cusLomer need and requesLs
3) unprompLed and unsollclLed acLlons by employees

I|nanc|a| System
O xlsLence of a well oranlzed flnanclal sysLem
O 9romoLes Lhe well beln and sLandard of llvln of Lhe people of a counLry
O Money and moneLary asseLs
O Moblllze Lhe savln
9romoLes lnvesLmenL
lnanclal SysLem of any counLry conslsLs of flnanclal markeLs flnanclal lnLermedlaLlon and
flnanclal lnsLrumenLs or flnanclal producLs

Ind|an I|nanc|a| System
Crgan|zed Non Crgan|zed
eulaLors Money lenders
lnanclal lnsLlLuLlons ocal bankers
lnanclal MarkeLs @raders
lnanclal servlces andlords
ChlL unds