PIMG

M.B.A.-III Semester 2014

CONSUMER BEHAVIOUR

Unit I
3

Consumer Research
 Consumer Research
The systematic and objective process of
gathering, recording, and analyzing data for
aid in understanding and predicting consumer
thoughts, feelings, and behaviors.
In a global environment, research has become
truly international.
 Important Factors in Consumer
Research
• Speed
• The Internet
• Globalization
• Data Overload
 Types of Consumer Research
• Basic Research
– To expand knowledge about consumers in general
• Applied Research
– When a decision must be made about a real-life
problem
The Consumer Research Process
• Defining the Problem and Project Scope
• The Research Approach
• The Research Design
• Data Collection
• Data Analysis and Interpretation
• Report
 Consumer Research Methods

• Methods of consumer
research
• Primary research
methods
• Advantages and
disadvantages of each
method
Two Research Methods

• Secondary: use of existing

research already done
– Government
– Consulting firms
– Newspaper and magazine articles
• Primary: creation of specific
studies to answer specific
questions
 Primary Research Methods

• Surveys
• Experimentation
• Focus groups
• In-depth interviews
• Projective techniques
• Physiological
Measures
 Surveys
• Planned questions • Forms
– Open-ended – Mail
– Closed-ended – Telephone
• Sample size and – Mall Intercept
inferences – Computer/Internet
• Biases
– Wording
– Response
– Interviewer
 Computer/Online surveys
• Getting people to follow
instructions
• Opportunities for branching
(contingent questions)
• Sampling frame and response
• Possible emerging
opportunities
– Correlating data on which not
all respondents have answered
the same questions
 Experimentation

• Real world relevance

vs. control (internal vs.
external validity)
• “Treatments” and
factorial designs
• Sample sizes and
inferences
Focus Groups

• Groups of 8-12
consumers assembled
• Start out talking
generally about
context of product
• Gradually focus in on
actual product
Focus group research
In-depth interviews

• Structured vs.
unstructured
interviews
• Generalizing to other
consumers
• Biases
Projective Techniques (Creative Research)

• Measurement of
attitudes consumers
are unwilling to
express
• Consumer discusses
what other consumer
might think, feel, or do
Observation

• Consumer is observed--
preferably unobtrusively--
while:
– Examining products prior to
making a purchase
– Using a product
– Engaging in behavior where the
product may be useful
 Physiological Measures
• Devices attached to the consumer to measure
– Arousal
– Eye movement
• Consumer feedback
– Lever pulled to positive or negative positions
– Squeeze on ball
 Projection
• Psychological technique to get answers
without asking a direct question
• Participants project their unconscious beliefs
into other people or objects
• Reduces threat of personal vulnerability
• Consists of a stimulus and a response
 Associations
Uncovers a brand’s identity or product
attributes

• Word association for a product/brand

• Draw brands as people
 Construction
Process allows participant to construct
meaning
• Participant constructs a story or picture from
a concept
• Collages are developed on a topic
• Bubble drawings or cartoon tests ask
participant to construct a dialog
 Completion
For insight into participant’s need-value
system.
• Sentences, stories or conversations are
completed
• Eg. “When I think of beer…..”
 Expressive
For situations when participants cannot
describe their actions but can demonstrate
them.
• Participants role play or act out a story
• Themes are developed based on participants’
personal interpretations of pictures
• House where brand lives (Bud vs Guiness)
 Choice Ordering
Useful for rank ordering characteristics
associated with a brand, product or service
• Participants lists benefits from most to least
important
• Used with probing techniques to gather
insight into consumer benefit choices
 Projective Techniques
Zaltman metaphor elicitation technique (ZMET)
• Metaphor elicitation
• Collage building
• Brand stories
Video Elicitation
• Parasocial relationships
• Non-intrusive interviewing
• Point and counterpoint
 Data Analysis
Quantify by classifying content into categories
that are given numerical values
Qualify what is meant by the projections
• Participants elaborate on meanings
• Multiple tests allow patterns to emerge
Triangulation of multiple methods brings
authenticity to data analysis
 Creative Development Research
• Elicits consumer response to advertising ideas
• Requires creatives to understand response
• Creatives must seek ways to improve response of
future viewers
• Utilizes groups for comments that stimulate other
comments
• Requires experienced moderator / planner
 Assignment d

Pick a brand: Pepsi, Tata Docomo, HDFC, LIC, Samsung

Galaxy, Nokia Lumia, Geetanjali, BSNL, Aircel, ICICI,
Nestle, Bajaj Motors, Maggi, Sony Bravia, Sona Chandi
Chwanprash.
• Cut images from a magazine/newspaper that best
describe your feelings about the brand
• Paste the images together into a collage
• Explain what these images mean to you and why they
apply to the brand
• Compare your responses with those of another with
the same brand
 Assignment c, e

Pick a brand: Maruti Suzuki, Coca Cola, Vodafone, SBI,

LG, Sony, Panasonic, Tanishq, Airtel, Idea, ICICI,
Cadbury, Hyundai, M & M, Hero Motocorp, Lenovo.
• Cut images from a magazine/newspaper that best
describe your feelings about the brand
• Past the images together into a collage
• Explain what these images mean to you and why they
apply to the brand
• Compare your responses with those of another with
the same brand
 PIMG
(M.B.A.-III Semester 2011)
Consumer Behaviour

Unit I
4
Consumers’ Impact on
Marketing Strategy
 Consumer Behavior Involves
Many Different Actors
• Consumer:
– A person who identifies a need or desire, makes a
purchase, and then disposes of the product
• Many people may be involved in this sequence of
events.
– Purchaser / User / Influencer
• Consumers may take the form of organizations or
groups.
 Consumers’ Impact on
Marketing Strategy
• Market Segmentation:
– Identifies groups of consumers who are similar to
one another in one or more ways and then
devises marketing strategies that appeal to one or
more groups
• Demographics:
– Statistics that measure observable aspects of a
population
• Ex.: Age, Gender, Family Structure, Social Class and
Income, Race and Ethnicity, Lifestyle, and Geography
 A Lesson Learned
• Nike was forced to pull
this advertisement for a
running shoe after
disabilities rights groups
claimed the ads were
offensive.
• How could Nike have
done a better job of
getting its message across
without offending a
powerful demographic?
Market Segmentation
Finely-tuned marketing
segmentation strategies
allow marketers to
reach only those
consumers likely to be
interested in buying
their products.
 Consumers’ Impact on
Marketing Strategy (cont.)
• Relationship Marketing: Building Bonds with
Consumers
– Relationship marketing:
• The strategic perspective that stresses the long-term,
human side of buyer-seller interactions
– Database marketing:
• Tracking consumers’ buying habits very closely, and
then crafting products and messages tailored precisely
to people’s wants and needs based on this information
 Marketing’s Impact on Consumers
• Marketing and Culture:
– Popular Culture:
• Music, movies, sports, books, celebrities, and other
forms of entertainment consumed by the mass market.
– Marketers play a significant role in our view of the
world and how we live in it.
 Popular Culture

Companies often create product icons to develop an

identity for their products. Many made-up creatures and
personalities, such as Mr. Clean, the Michelin tire man and
the Pillsbury Doughboy, are widely recognized figures in
popular culture.
 Marketing’s Impact on Consumers: The
Meaning of Consumption

• The Meaning of Consumption:

– People often buy products not for what they do,
but for what they mean.
– Types of relationships a person may have with a
product:
• Self-concept attachment
• Nostalgic attachment
• Interdependence
• Love
 Marketing’s Impact on Consumers: The
Meaning of Consumption (cont.)

• Consumption includes intangible experiences,

ideas and services in addition to tangible
objects.
• Four types of Consumption Activities:
– Consuming as experience
– Consuming as integration
– Consuming as classification
– Consuming as play
 Four types of Consumption Activities

An Emotional or Aesthetic
Consuming as Experience
Reaction to Consumption Objects

Consuming as Integration Express Aspects of Self or

Society

Consuming as Classification Communicate Their Association

With Objects, Both to Self/ Others

Consuming as Play Participate in a Mutual Experience

and Merge Self With Group
Marketing’s Impact on Consumers: The Global
Consumer

• By 2015, the majority of people on earth will

live in urban centers.
• Sophisticated marketing strategies contribute
to a global consumer culture.
• Even smaller companies look to expand
overseas.
• Globalization has resulted in varied
perceptions of Consumers (both positive and
negative).
 The Global Consumer
American products like Levi jeans are in
demand around the world.
 Marketing’s Impact on Consumers: Virtual
Consumption
• The Digital Revolution is one of the most significant
influences on consumer behavior.
• Electronic marketing increases convenience by
breaking down the barriers of time and location.
• U-commerce:
– The use of ubiquitous networks that will slowly but surely
become part of us (i.e., wearable computers, customized
advertisements beamed to cell phones, etc.)
• Cyberspace has created a revolution in C2C
(consumer-to-consumer) activity.
Virtual Brand Communities
 Blurred Boundaries
Marketing and Reality

• Marketers and consumers coexist in a

complicated two-way relationship.
• It’s increasingly difficult for consumers to
discern the boundary between the fabricated
world and reality.
• Marketing influences both popular culture
and consumer perceptions of reality.
 Blurred Boundaries
Marketing managers
often borrow imagery
from other forms of
popular culture to
connect with an
audience. This line of
syrups adapts the “look”
of a pulp detective
novel.
 Marketing Ethics and Public Policy

• Business Ethics:
– Rules of conduct that guide actions in the
marketplace
– The standards against which most people in the
culture judge what is right and what is wrong, good
or bad
• Notions of right and wrong differ among
people, organizations, and cultures.
 Needs and Wants:
Do Marketers Manipulate Consumers?
• Consumerspace
• Do marketers create artificial needs?
– Need: A basic biological motive
– Want: One way that society has taught us that need can
be satisfied
• Are advertising and marketing necessary?
– Economics of information perspective: Advertising is an
important source of consumer information.
• Do marketers promise miracles?
– Advertisers simply don’t know enough to manipulate
people.
 Discussion Question
• This ad was created by
the American
Association of
Advertising Agencies to
counter charges that
ads create artificial
needs.
• Do you agree with the
premise of the ad? Why
or why not?
 Public Policy and Consumerism
• Consumer efforts in the U.S. have contributed to the
establishment of federal agencies to oversee
consumer-related activities.
– Department of Agriculture
– Federal Trade Commission
– Food and Drug Administration
– Securities and Exchange Commission
– Environmental Protection Agency
• Culture Jamming:
– A strategy to disrupt efforts by the corporate world to
dominate our cultural landscape
The Consumer Product Safety Commission
Culture Jamming
• Adbusters Quarterly is a
Canadian magazine
devoted to culture
jamming. This mock ad
skewers Benetton.
 Consumerism and
Consumer Research
• Kennedy’s “Declaration of Consumer Rights” (1962)
• Green Marketing:
– When a firm chooses to protect or enhance the natural
environment as it goes about its activities
• Reducing wasteful packaging
• Donations to charity
• Social Marketing:
– Using marketing techniques to encourage positive
activities (e.g. literacy) and to discourage negative
activities (e.g. drunk driving)
 Consumer Related Issues

• UNICEF sponsored this advertising campaign against child labor. The field
of consumer behavior plays a role in addressing important consumer
issues such as child exploitation.
 The Dark Side of
Consumer Behavior

• Consumer Terrorism:
– An example: Susceptibility of the nation’s food
supply to bioterrorism
• Addictive Consumption:
– Consumer addiction:
• A physiological and/or psychological dependency on
products or services
• Compulsive Consumption:
– Repetitive shopping as an antidote to tension,
anxiety, depression, or boredom
 The Dark Side of
Consumer Behavior (cont.)

• Consumed Consumers:
– People who are used or exploited, willingly or not, for
commercial gain in the marketplace
• Illegal Activities:
– Consumer Theft:
• Shrinkage: The industry term for inventory and cash
losses from shoplifting and employee theft
– Anticonsumption:
• Events in which products and services are deliberately
defaced or mutilated
 Consumer Behavior
As a Field of Study

• Consumer behavior only recently a formal

field of study
• Interdisciplinary influences on the study of
consumer behavior
– Consumer behavior studied by researchers from
diverse backgrounds
– Consumer phenomena can be studied in different
ways and on different levels
Journal of Consumer Research
The Pyramid of Consumer Behavior
 Consumer Behavior Disciplines
• The Issue of Strategic Focus
– Should CB have a strategic focus or be studied as a
pure social science?
• The Issue of Two Perspectives on Consumer
Research
– Positivism (modernism):
• Paradigm that emphasizes the supremacy of human
reason and the objective search for truth through
science
– Interpretivism (postmodernism):
• Paradigm that emphasizes the importance of symbolic,
subjective experience and meaning is in the mind of
the person
Positivist vs. Interpretivist Approaches to CB
The Wheel of Consumer Behavior
 PIMG
(M.B.A.-III Semester 2011)
Consumer Behaviour

Unit I
5

Modeling Behaviour
 Models of Consumer Behaviour
• Types of consumption
• Purchase paradigms
• Modelling consumption behaviour

“Human responses in a commercial world”

 What determines food choice?
• Prices + Income + Preferences
• There are three types of influences on
preference and choices for food:
– Characteristics of the product
– Characteristics of the individual
– Characteristics of the environment
 Types of consumption
• Important purchases (relevance)
• Repetitive consumption (frequency)
• Involuntary consumption (freedom)
• Group consumption (susceptibility to social
influence)
 Important purchases
• Product purchased for the first time
• Infrequently purchased products
– Time and effort to choose
– Little experience
– High involvement

Going to a new restaurant

Choosing the menu for an important dinner
 Repetitive consumption
• Frequent purchase
• Low price (or standard quality/variability?)
• Little conscious attention
• Low involvement
• Experience goods

Salt at the supermarket

 Involuntary consumption
• Unavoidable consumption
– Petrol for the car
– Telephone
– Repair of roads (social form, public goods)
– …

• Choice between brands?

Tap water
 Group consumption
• Purchase based on some group influence
process
– Family expenditures
– Company purchases

Mineral water
Purchase paradigms, theories and
models

Paradigm (perspective, framework)

Theory MODEL
Why do we need Consumer Behaviour
theories, paradigms and models?
• To support marketing practices as:
– Use of pricing incentives
• Impact on sales
• Reaction after the end of price cuts
• Understanding reasons behind consumer behaviour
– Advertising
• Impact on sales (or loyalty or brand recognition)
• Duration of effects
• Underlying mechanisms
– Brand extension
• Impact on the new product
• Impact on the old product
• Why?
 Example: price cuts
• During promotion: sales (quantity) up by 50%
• After promotion: sales at same level as before
• Why?
– % of new purchasers
– Perception low prices as low quality
 Purchase paradigms
• Are not mutually exclusive
• Subjective preferences
• Appropriateness for particular conditions
 Purchase paradigms
1. Cognitive paradigm (US)
– Purchase as the outcome of problem-solving

2. Reinforcement paradigm (UK)

– Purchase as learned behaviour

3. Habit paradigm
– Pre-established pattern of behaviour
 The Cognitive paradigm

• Decision-making as an explanation for

consumer behaviour
“The cognitive consumer is credited with the capacity
to receive and handle considerable quantities of
information, to engage actively in the comparative
evaluation of alternative products and brands, and
to select rationally among them” [Foxall]
 Cognitive paradigm
• Does it work?
• Typical purchase (especially for food)
– Few alternatives
– Little external search
– Few evaluative criteria
• Engel, Blackwell and Miniard (1995)
Extended Problem Solving (EPS)
• New and important purchases
Problem/need recognition

Search for information

Evaluation of alternatives

Purchase

Consumption

Post-consumption evaluation
 Limited problem solving (LPS)
• Even in new purchase there are no time,
resource and motivation to the search
• Search for information and evaluation of
alternatives are limited
 Habitual decision-making
• Loyalty to the brand
• Inertia
– The need is satisfied, but there is no special
interest in the product
• Food products
• “Satisficing behaviour”
Accept the first solution that is good enough to satisfy your
need, even if a better solution may be missed
Satisficing behaviour (Simon, 1957; Klein, 1989)
OR Automatic Response Behaviour (ARB)

Need recognition

Evaluation of single Option

NO

Purchase?

YES

END
 The Reinforcement paradigm
(Learning Theory)
• Reinforcer: an experience which raises the
frequency of “responses” associated with it
• Punisher: an experience which reduces the
frequency of such response
[Skinner, 1938; 1953]
 The learned behaviour theory
• Past behaviour teaches us, and after learning
we can modify later behaviour
– Satisfaction/dissatisfaction with a product
– It is a valid theory both under the reinforcement
and habit paradigm
 Some types of learning
• Classic conditioning
• “generalising effect”
• Learning is generalised
– Brand extension: use of an existing brand for a new product
– Use of stimuli: packaging, brand names, colours, smells,
music, context of purchase/consumption
• Reinforcement learning
– Trial and error learning
– Shaping (behaviour changed by reinforcing the
performances that show change in a desired direction)
 Classical conditioning
• Signs and colour coding (e.g. mailbox)
 The satiation effect
• Heavily used reinforcements lose power
(satiation effect)
– Wearout in advertisement
– Desensitisation: stimulus satiation
Stimuli and reinforcement learning
• Continuous and Intermittent learning
– Continuous is quicker
– Intermittent has a larger final effect
– Extinction period after the end of reinforcement
is longer for intermittent learning
 Punishment and reinforcement
learning
• Food poisoning consequences
– One failure is enough
– Undiscovered later improvements of the product
– Effect is long-lasting
 Reinforcement and marketing
strategy
• Control stimuli to “direct” behaviour
• Reinforcers
– Pleasure
– Information
• Degree of “openness” (range of activities
available to the consumer)
• Environment affects behaviour
 The Habit paradigm
• While the cognitive and reinforcement paradigms
are based on dynamics and change, the habit one is
related to aggregate stable markets, where
behaviour is seen as relatively unchanging.
• The habit paradigm excludes problem-solving or
planning
• Judgment comes after purchase and habits may be
broken
 The involvement factor
• Involvement
– Importance of purchase
– Risks involved
• Potential costs
• Irreversibility of the decision
– Type of cognitive process that is generated
 Frustration factor
• Frustration as “blocked motivation”
• No options are available
• Minor frustrations in using products may lead
to change products
• New products should be designed to avoid
frustration
Managerial control and the purchase
paradigms
• Cognitive paradigm
– Provide information and persuasion
– Suitable for one-off decisions
• Reinforcement paradigm
– Change the environment and stimuli
• Habit paradigm
– Packaging
– Advertising
 Problem/need recognition
• In general, individuals recognise they have a
need for something when there is a
discrepancy between their actual state and
ideal state.
 Need recognition and marketing
strategy
• Advertising
• In-store promotion
• Visibility
Need recognition…
 Variables involved in understanding
consumer behaviour

• Stimulus – ads, products, hungerpangs

• Response – physical/mental reaction to the
stimulus
• Intervening variables – mood, knowledge,
attitude, values, situations, etc.
Overall Model of Consumer Behaviour
External Influences Decision Processes
Culture
Subculture
Demographics Problem Recognition
Social status
Reference groups
Family Information Search
Marketing Activities Self-Concept
& Alt Eval & Selection
Learning
Internal Influences
Perception Outlet select & Purchase
Learning
Memory
Motives Postpurchase
Personality Processes
Emotions
Attitudes
 PIMG
(M.B.A.-III Semester 2014)
Consumer Behaviour

Unit II
1

Needs and Motivation

 What Is Motivation?
• The driving force within individuals that
impels them to action
– Produced by a state of tension due to an
unfulfilled need
– Which leads to conscious/subconscious attempts
to reduce the tension
 Types of Needs

• Innate Needs
– Physiological (or biogenic) needs that are
considered primary needs or motives

• Acquired needs
– Generally psychological (or psychogenic) needs
that are considered secondary needs or motives
 Types of Motives
• Rational Motives
– Goals chosen according to objective criteria (e.g.,
price)
• Emotional Motives
– Goals chosen according to personal or subjective
criteria (e.g., desire for social status)
 Types of Motives
• Latent Motives
– Motives that the consumer is unaware of or
unwilling to recognize
– Harder to identify
– Require projective techniques to identify
• Manifest Motives
– Motives that the consumer is aware of and
willing to express
 Goals
• Generic Goals
– the general categories of goals that
consumers see as a way to fulfill their needs
– e.g., “I want to get a graduate degree”
• Product-Specific Goals
– the specifically branded products or services
that consumers select as their goals
– e.g., “I want to get an MBA in Marketing
from IIM Ahmedabad.”
 The Selection of Goals

• The goals selected by an individual depend on

their:
– Personal experiences
– Physical capacity
– Prevailing cultural norms and values
– Goal’s accessibility in the physical and social
environment
 Motivations and Goals
Positive Motivation Negative Motivation
A driving force A driving force away
toward some object from some object or
or condition condition
Leads to an Leads to an
Approach Goal Avoidance Goal
A positive goal toward A negative goal from
which behaviour is which behaviour is
directed directed away
 The Dynamic Nature of Motivation

• Needs are never fully satisfied

• New needs emerge as old needs are satisfied
• A given need may lead totally different goals
• Consumers are more aware of their goals than
their needs
 The Dynamic Nature of Motivation
• Consumer values, personality and self-concept
influence consumer goals
• Consumers have multiple needs
– Pre-potent need
• Motives are difficult to infer from behaviour
• Past experiences (success/failure) influence goals
– Defence Mechanisms
 The Dynamic Nature of Motivation
• Motives may conflict with each other
– Three types of motivational conflict
• Approach-approach: when a consumer is drawn towards
two positive goals
• Approach-avoidance: when the goal object has both
positive and negative qualities
– You are both drawn toward and away from the object
• Avoidance-avoidance: when the consequences of buying an
object is unpleasant, and the purchase does not lead to any
pleasure
The Dynamic Nature of Motivation
• Motives can be aroused in many ways
– Physiological arousal
• Hunger, thirst
– Emotional arousal
• daydreaming
– Cognitive arousal
• Random thoughts
– Environmental arousal
• Cues in the environment (e.g. smell of food)
 Philosophies Concerned With Arousal
of Motives

• Behaviourist School
– Behaviour is response to stimulus
– Elements of conscious thoughts are to be
ignored
– Consumer does not act, but reacts
• Cognitive School
– Behaviour is directed at goal achievement
– Need to consider needs, attitudes, beliefs, etc. in
understanding consumer behaviour
Maslow’s Hierarchy of Needs
Maslow’s Hierarchy of Needs

TellBiological
the truth
Maslow’s Hierarchy of Needs

Safety
Commit to use

TellBiological
the truth
Maslow’s Hierarchy of Needs

Love and Belonging

Affirmation
Safety
Commit to use

TellBiological
the truth
Maslow’s Hierarchy of Needs

Self-Esteem

Love and Belonging

Affirmation
Safety
Commit to use
Biological
Tell the truth
Tell the truth
Maslow’s Hierarchy of Needs
Self-Actualization
Self-Esteem

Love and Belonging

Affirmation
Safety
Commit to use

TellBiological
the truth
 McClelland’s Trio of Needs
• Power
– individual’s desire to control environment
• Affiliation
– need for friendship, acceptance, and belonging
• Achievement
– need for personal accomplishment
– closely related to egoistic and self-actualization needs

3-121
Motivation and Marketing Strategy
• Identify the needs and goals of the target
market
– Identify both latent and manifest motives
• Use knowledge of needs to segment the
market and to position the product
• Use knowledge of needs to develop
promotional strategies
• Reduce motivational conflict
 PIMG
(M.B.A.-III Semester 2014)
Consumer Behaviour

Unit II
2

LEARNING: PRINCIPLES, THEORIES

 Snapshot from the Marketplace

• Today, companies combat consumer brand-

switching by offering rewards programs.
• Frequent-shopper programs’ rewards are
instrumental in the consumer learning process
for building customer loyalty.
• Companies ranging from airlines and hotels to
grocery chains offer myriads of rewards,
including preferential prices, frequent-flier
miles and free hotel nights, gifts, or even
Foursquare “badges.”
 What is Learning?

• Consumption of products and services is

a result of a learning process.
• Consumer behavior includes learning as
both adaptive and problem-solving
activity.
• As we come to discover that certain
behaviors produce results that are more
satisfying than others, we reassess our
purchasing strategies and behavior.
 Definition of Learning

• A process by which changes occur in the

content or organization of a person’s long-
term memory
• Connecting categories to behaviors that have
adaptive value in terms of consumer goals.
 Learning Theory

• Learning: A change in behavior that is long-

term and relatively permanent

• Theory: A set of underlying principles or

tested assumptions which enable us to
– 1. Organize and interpret our observations and
– 2. Decide on a response to those observations

128
 Learning Qualifications
– Learning is not directly observable.
– Behavioral changes are brought about by
experience.
– Effects are relatively long term
– Learning covers both overt activities and
cognitive processes.
 Types of Learning
– Incidental learning
– Learning by description
– Vicarious learning
– Direct experience
 Range of Learning Situations

• Learning occurs in situations ranging from

low to high levels of consumer involvement.
– Low-involvement learning
• Case where we are less motivated to
attend to or process material
to be learned
– High-involvement learning
• Case where we are motivated to diligently
process the information to be learned
 Behavioural Learning Theories

 Three learning theories are particularly

applicable to consumer behavior:
 Classical Conditioning: involves linking a
conditioned stimulus and an unconditioned
stimulus
 Operant Conditioning: learning is driven by the
positive or negative consequences of behavior
 Classical Conditioning

Consider the experiments by Pavlov with dogs.

Conditioned
Stimulus (CS)
Co
me
s to
Elic
it

Unconditioned Elicit Unconditioned

Stimulus (US) Response (UR)
 Classical Conditioning
Step 1: Before Conditioning

Bell No Response

and

Food Response (Salivation)

 Classical Conditioning

Step 2: During Conditioning

Bell Followed by
Food Response (Salivation)
 Classical Conditioning

Step 3: After Conditioning

Food Response (Salivation)

 Classical conditioning
• Signs and colour coding (e.g. mailbox)
 Classical Conditioning
and Formation of Associations

• Learning, according to this view, is a process

of establishing linkages between two
concepts, or a fusing of two separate items
to form a new and unique entity different
from either.
• In a consumer behavior context:
– Conditioned stimuli include products, brands,
and stores
– Unconditioned stimuli might include
celebrities, music, and humor.
 Learning Principles
Under Classical Conditioning

• Four conditions must prevail for

connections to be formed:
– Repetition: Frequency of pairing a conditioned
and an unconditioned stimulus
– Contiguity: Spatial or temporal nearness of
objects
– Contingency: The conditioned stimulus should
precede the unconditioned stimulus
– Congruity: Sequentially presented cues must
be related
 Operant Conditioning
Consider Skinner’s Experiments with Pigeons and Rats

Specific Reinforcement
Behavior or Punishment

Increased or Decreased
Probability of Response
How Operant Conditioning Works
• Operant conditioning proposes a
sequence in which behavior occurs first.
It is then reinforced (or punished).
• Reinforcement or punishment are
instrumental in bringing about desired
behavioral changes.
 Learning Principles Under Operant Conditioning

• Learning occurs via trial and error.

– Positive reinforcement: an inducement to repeat a
behavior in order to receive a reward
– Negative reinforcement: an inducement to repeat
a behavior in order to remove an adverse situation
– Punishment: an aversive consequence that
decreases the likelihood a particular response will
recur
 Different Reinforcement Schedules
Produce Different Learning Patterns

Continuous Reinforcement Intermittent Reinforcement

Behavior Maintenance

Behavior Maintenance
Time Time

Here forgetting occurs more quickly. Here forgetting occurs gradually over time
and the residual affects of learning persist.
 Practice Schedules

• Timing exerts important influences on learning.

– Massed practice condenses a learning schedule
into a brief time span.
• Tends to produce greater initial learning
– Spaced practice paces learning over time
intervals.
• Tends to produce learning that is longer lasting
 Challenges in Applying Operant Conditioning

• Behavior must first occur before it can be

rewarded. To accomplish this, two
approaches can be employed.
– Behavior shaping breaks down a complex
behavior into a series of simple component actions
and reinforces learners at each successive step.
– Ecological design involves calculated design of
physical space and other facets of the environment
to attain a desired consumer response.
 Applications of Conditioning Theories:
Stimulus Generalization and Discrimination

• Stimulus Generalization
– Our tendency to assign commonality to similar
stimuli
• Our response to one stimulus becomes extended to
other similar stimuli
• Case in point: Halo effect
• Stimulus Discrimination
– Our tendency to distinguish between similar—but
non-identical—stimuli
• Gives marketers the opportunity to differentiate their
products
 Cognitive Learning

• Humans are not locked into a ceaselessly

repetitive stimulus-response behavior
mode. Rather, we have the ability to think,
analyze, associate, learn consequences,
and solve problems.
• We may act differently in each case based
on perceived circumstances.
Classical Conditioning Revisited

• Renewed interest in classical

conditioning has produced Neo-
Pavlovian Conditioning: a
viewpoint that reshapes traditional
classical conditioning into a fully
cognitive theory.
 Neo-Pavlovian Conditioning

• Learned associations are not simple, but

rather rich and complex, involving
relationships among multiple objects or
events.
• This concept views conditioned learning as
not mere acquisition of new reflexes, but
rather as cognitive procurement of new
knowledge about the environment, where
one stimulus provides information about
another.
 The Reinforcement paradigm
(Learning Theory)
• Reinforcer: an experience which raises the
frequency of “responses” associated with it
• Punisher: an experience which reduces the
frequency of such response
[Skinner, 1938; 1953]
 The learned behaviour theory
• Past behaviour teaches us, and after learning
we can modify later behaviour
– Satisfaction/dissatisfaction with a product
– It is a valid theory both under the reinforcement
and habit paradigm
 Some types of learning
• Classic conditioning
• “generalising effect”
• Learning is generalised
– Brand extension: use of an existing brand for a new product
– Use of stimuli: packaging, brand names, colours, smells,
music, context of purchase/consumption
• Reinforcement learning
– Trial and error learning
– Shaping (behaviour changed by reinforcing the
performances that show change in a desired direction)
 The satiation effect
• Heavily used reinforcements lose power
(satiation effect)
– Wearout in advertisement
– Desensitisation: stimulus satiation
Stimuli and reinforcement learning
• Continuous and Intermittent learning
– Continuous is quicker
– Intermittent has a larger final effect
– Extinction period after the end of reinforcement
is longer for intermittent learning
 Punishment and reinforcement
learning
• Food poisoning consequences
– One failure is enough
– Undiscovered later improvements of the product
– Effect is long-lasting
 Reinforcement and marketing
strategy
• Control stimuli to “direct” behaviour
• Reinforcers
– Pleasure
– Information
• Degree of “openness” (range of activities
available to the consumer)
• Environment affects behaviour
 The Habit paradigm
• While the cognitive and reinforcement paradigms
are based on dynamics and change, the habit one is
related to aggregate stable markets, where
behaviour is seen as relatively unchanging.
• The habit paradigm excludes problem-solving or
planning
• Judgment comes after purchase and habits may be
broken
 The involvement factor
• Involvement
– Importance of purchase
– Risks involved
• Potential costs
• Irreversibility of the decision
– Type of cognitive process that is generated
 Frustration factor
• Frustration as “blocked motivation”
• No options are available
• Minor frustrations in using products may lead
to change products
• New products should be designed to avoid
frustration
Managerial control and the purchase
paradigms
• Cognitive paradigm
– Provide information and persuasion
– Suitable for one-off decisions
• Reinforcement paradigm
– Change the environment and stimuli
• Habit paradigm
– Packaging
– Advertising
 Learning & Hemispheric Specialization of the Brain

• A view that the left and right hemispheres of

the brain process, organize, and encode
information differently
– Left Hemisphere
• Specializes in analytical thinking,
verbalization, and algebraic calculations
– Right Hemisphere
• Specializes in interpreting and recognizing
visual patterns
 Learning-Related Concepts

• Vicarious learning: behavior change due to

observing the activity of others and the
consequences of their behavior
• Learning curve (Experience effect): tasks
become easier and are performed more quickly as
the number of repetitions increases
• Brand loyalty: consistent purchase of a specific
brand within a product category
• Brand parity: a belief that no significant
differences exist among brands
 Memory and Retention

• Mnemonic devices: auditory or visual aids

that promote retention of material by identifying
it with some easily-remembered symbols
• Google effect:
– In the case of information that is easily found online,
we tend to remember where it can be found rather
than recall the information itself
– In the case of less-easily-found information online,
we tend to remember the information itself.
 Memories
– Key elements from our and others’ experiences
that we store.
 The Structure of Memory
• Memory consists of three storage systems:
– Sensory memory: a storage system where
incoming data undergo preliminary processing
– Short-term memory: a storage system that
momentarily holds acquired information
• If information is significant, it may undergo:
– Rehearsal
– Encoding
– Long-term memory: an information warehouse
where data are organized and extendedly stored
• Knowledge structures: forming chunks composed of
related bits of information
 Why we forget
– Memory fades
– Absentmindedness
– Blocking
– Misattribution
– Bias
– Persistence
Information Retrieval, Extinction, & Forgetting

• Information retrieval: sifting through memory to activate

stored information
– Retrieval cues
• Extinction: when a behavior ceases because it no longer
brings rewards or prevents punishments
• Forgetting: when knowledge recedes into the mind’s
unconscious recesses and cannot be recalled
• Retroactive interference: when recent
learning interferes with recall of previous learning
– Misinformation effect
• Proactive interference: when prior learning interferes
with recall of recent learning
 PIMG
(M.B.A.-III Semester 2014)
Consumer Behaviour

Unit II
3

Personality and Self-Concept

 Personality

The
The totality
totality of
of thoughts,
thoughts,
emotions,
emotions, intentions,
intentions, and
and
behaviors
behaviors thatthat aa person
person
exhibits
exhibits consistently
consistently asas he
he
or
or she
she adapts
adapts toto his
his or
or her
her
environment.
environment.
6-169
 Personality
• Set of traits, characteristics, and
predispositions of a person
• Usually matures and stabilizes by about age
30
• Affects how a person adjusts to different
environments
Personality Qualities

• Unique to an individual
• Can be conceptualized as a
combination of specific traits
or characteristics
• Traits are relatively stable and
interact with situations to
influence behavior
• Specific behaviors can vary
across time
Psychoanalytic Approach

Id
Id

Superego
Superego

Ego
Ego
6-172
 Personality Theories
• Cognitive theory: people develop their
thinking patterns as their life unfolds
• Learning theories: behavior patterns
develop from the social environment
• Biological theories: personality as genetically
inherited
 Personality Theories (Cont.)
• Cognitive theory
– Develop thinking patterns as life unfolds
– Affects how the person interprets and internalizes
life's events
– Cognitive development stages
• Reflexive behavior of infant
• More complex modes of perception and interpretation
of events
– Neither driven by instincts nor unwittingly shaped
by environmental influences
 Personality Theories (Cont.)
• Learning theories
– Learn behavior from social interaction with other
people
– Young child: early family socialization
– Continuously learn from social environment:
stable behavior forms the personality
– Uniqueness of each personality follows from
variability in social experiences
 Personality Theories (Cont.)
• Biological theories
– Ethological theory
• Develop common characteristics as a result of
evolution
• Behavioral characteristics that have helped survival
over generations become inborn characteristics
 Personality Theories (Cont.)
• Biological theories (cont.)
– Behavior genetics
• Individual's unique gene structure affects personality
development
• Personality develops from interactions between a
person's genetic structure and social environment
 The Big-Five
Personality Dimensions
• Extroversion
– High: talkative, sociable
– Low: reserved, introverted
• Emotional stability
– High: calm, relaxed
– Low: worried, depressed
• Agreeableness
– High: cooperative, tolerant
– Low: rude, cold
 The Big-Five
Personality Dimensions (Cont.)
• Conscientiousness
– High: dependable, thorough
– Low: sloppy, careless
• Openness to experience
– High: curious, intelligent
– Low: simple, conventional

Assess yourself on each dimension

 Personality Types
• Locus of control: people control the
consequences of their actions or are
controlled by external factors
– External control: luck, fate, or powerful external
forces control one’s destiny
– Internal control: believe they control what
happens to them

Assess yourself against each type.

 Personality Types (Cont.)
• Machiavellianism
– Holds cynical views of other people's motives
– Places little value on honesty
– Approaches the world with manipulative intent
– Maintains distance between self and others
– Emotionally detached from other people
– Suspicious interpersonal orientation can
contribute to high interpersonal conflict
 Personality Types (Cont.)
• Machiavellianism (cont.)
– Focus on personal goals, even if reaching them
requires unethical behavior
– Suspicious orientation leads to view of
organizational world as a web of political
processes
 Personality Types (Cont.)
• Type A personality: a keen sense of time
urgency, focuses excessively on achievement,
aggressive
Type B personality: strong self-esteem, even
tempered, no sense of time urgency

Type A: significant risk factor for coronary heart disease.

 Personality Types (Cont.)
• Myers-Briggs Type Indicator (MBTI)
– Popular personality assessment device
– Four bi-polar dimensions
• Extroverted (E) - introverted (I)
• Sensing (S) - intuitive (I)
• Thinking (T) - feeling (F)
• Perceiving (P) - judging (J)
– Assigns people to one of sixteen types based on
these dimensions
 Personality Types (Cont.)
• Myers-Briggs Type Indicator (MBTI) (cont.)
– Extroverts look outward; introverts turn inward
– Sensers use data; intuitives use hunches
– Thinkers are objective; feelers are subjective
– Perceivers are flexible; judgers want closure
– ESTJ type: extroverted, sensing, thinking, and
judging
 Trait Approach
• Trait – a distinguishable characteristic that
describes one’s tendency to act in a relatively
consistent manner.
• Approaches:
– Nomothetic perspective
– Idiographic perspective

6-186
Important Traits Studied

Value
Value Materialism
Materialism
consciousness
consciousness

Complaint
Complaint
Innovativeness
Innovativeness proneness
proneness

Competitiveness
Competitiveness
6-187
Five-Factor Model

6-188
 Hierarchical Approaches
• Begin with the assumption that personality
traits exist at varying levels of abstraction.
– Specific traits – tendencies to behave in very well-
defined situations (e.g., complaint-propensity).
– Broad traits – behaviors that are performed
across many different situations (e.g.,
extroversion).

6-189
 Personology Approach
• Combines information on traits, goals, and
consumer lifestories to gain a better
understanding of personality.

6-190
• Total number of how a person can react and interact with others
• Personality determinant
- clan
- environment
- situation
• Especially personality atribute
- locus of control
- machiavellianism
- self-esteem
- self-monitoring
- Take a risk
- Type A Personality
Brand Personality Dimensions

6-192