MKTG7503: Consumer & Buyer Behaviour

Contemporary perspectives on consumer behaviour

Week 2
Semester 2, 2023

(1st & 3rd August)

CRICOS code 00025B

Last Week

 Course overview
 Assessment overview
 Consumption
 The different approaches to studying consumers

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 Lecture Outline

Week 2 topic: Contemporary perspectives on consumer

behaviour
• Key topics from behavioural insights that impact
consumer behaviour
• Theories & practices of experiential consumption &
consumer culture theory (CCT)

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 Approaches to studying consumers and
consumption

Interdisciplinary perspectives on consumption:

 Anthropology
 Sociology
 Psychology
 Economics
 History
 Geography

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Consumer behaviour as a field of study

Interdisciplinary influences on the

study of consumer behaviour:
 There is great diversity in
researchers interested in CB
both in their background and
approach.
 Micro focus – individual
consumer behaviour (micro
issues)
 Macro focus – group behaviour,
societal trends and market
system issues. 5
Source: Solomon et al., (2013). Consumer behaviour: Buying, having, being. Pearson Australia, Sydney, p. 29
 Positivist vs. Interpretivist
Approaches

Assumptions Positivist Approach Interpretive Approach

Nature of reality Objective, tangible, Single Socially constructed
Multiple
Nature of the data Typically: response distilled into Typically visual, textual & verbal
numeric scores evidence - in rich detail

Goal Prediction Understanding

Knowledge Time-free; Context- Time-bound; Context-dependent
generated independent
Position of the Researchers is at “arms-length” The researcher is the research
researcher – tries to be ‘invisible” and instrument and uses skills and
relies on responses to rapport to gain insights based on
structured measures or choices trust

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Source: Adapted from Laurel A. Hudson & Julie L. Ozanne (1998, March). Alterative ways of seeking knowledge in consumer research.
Journal of Consumer Research, 14(4), 508-21.
 Big ideas this week

 Contemporary ways of looking at how consumers behave:

• The context of decisions - environment where consumers
make consumption choices influences behaviours in
different ways (behavioural insight).
• Consumers are experience-seekers – emphasis away from
consumers as buyers to a focus on consumer experiences.
 Social and cultural aspects of consumption influence
consumers (CCT: Consumer Culture Theory)
 Technology creates new contexts that influence and drive
consumption.
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 Behavioural Insights

 Focuses on the contexts of decisions;

the environment within which
consumption choices take place.
 Often involves choice architecture
which is how the way a choice is
presented influences the choices made.
 The study of “nudging” people towards
a particular behaviour
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Example: the black housefly at Schiphol airport urinal

Automatic Mode

 When you are operating routinely with little effort and

no feeling of voluntarily being in control.

Uncontrolled Effortless

Associative
Fast Automatic
Mode

Unconscious Skilled

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Reflective Mode

 When you are giving effortful attention to a mental

activity. This is often associated with considered choice
and concentration.
Controlled Effortful

Deductive
Slow Reflective
Mode

Self-aware Rule-following 10
 Mental accounting and loss aversion

 Mental accounting is when individuals allocate assets

into separate, non-transferable groupings to which
they may assign different levels of utility.
• Example: How people save for a holiday
• Sometimes results in irrational behaviour

 Acts to frame and keep decision-making under

control based on the individual’s cognitive
limitations – how costs & benefits are weighed in
the mind of the consumer.
• Loss aversion – generally we dislike losses more
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than we like gains of an equivalent amount.
 Norms

 Norms are the informal rules that govern behaviour

Typical Meaning in
Behaviour Australia Alternative Meaning

Consumers age 14-17
consuming beer or wine in a
restaurant
Supervisors and employees
socialising together
Kissing
Unacceptable & illegal in
many areas
Supervisors and co-workers
can be friendly with each
other
Purely a family greeting or
romantic activity
Alcohol is part of a nice family meal in
many Western cultures. Not
considered “drinking”.
Employees and supervisors should
keep their distance away from work.
An employee who acts too casually
with a ‘senior’ could incur a sanction.
In many nations, kissing is common
when making a new acquaintance or
greeting a friend.

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See Steve Martin (2012) Idea Watch, Harvard Business Review, pp. 23-25
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 Discussion 1

Consider how ideas from behavioural economics might be used to

tackle obesity in schools. Particular questions to discuss in your
groups:
 How might choice architecture be used?
 How important might our understanding of automatic and reflective
modes be for this project?

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Behavioural Economics

 A default is a preselected option without active choice,

e.g. organ donors.

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 the “Usain Bolt of nudges”
When nudges becomes shoves
Cass Sustein, 2018

Automatic enrolments “has far more impact than other kinds of nudges”
such as making choices simpler and easier for people

Source: Accenture’s 2016 Consumer Survey

https://www.accenture.com/au-en/insight- 16
new-au-patient-engagement-survey
Priming – influencing behaviour

… is the altering of people’s behaviour outside of their

conscious awareness as a result of their first being
exposed to certain sights, words, sensations or activities

SO_P?

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 Discussion 2: How easily are we
influenced

Read Consumer Insight 2.2 (p. 51-52)

1. Consider how you might use what you have learnt about priming to increase
saving energy (e.g. water, electricity).
2. Think of some examples of how manufacturers use priming to encourage us
to purchase products. Are there instances where this has been used in ways
that might be considered unethical , e.g., to encourage increased
consumption?
Words

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Sight Smell
Experiential Marketing

 Consumers as experience-seekers
 Emphasizes sensory hedonic aspects of consumers
rather than rational maximizers.

Remembere
Pre- Core
Purchase d
consumptio consumptio
experience consumptio
n n
n

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 Experiential Marketing

 Hedonic consumption – the multi-sensory, fantasy, and emotional

aspects of consumers’ interactions with products.
 Creating “fun, fantasy and feeling” (Holbrook and Hirschman, 1982)

 Experiences are events that engage individuals in a personal and

memorable way (Pine & Gilmore 1998).
• Emphasis away from consumer as buyer to focus on consumer experiences

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Discussion 3

Discuss the ‘Share a Coke’ campaign in a group:

 Explain how the marketing actions used
in this campaign creates an ‘experience’
for the consumer?
• Describe the experience?
• What emotions does it evoke?
• What sensory and hedonic aspects of the
consumers are being influenced?
 What are the good and ‘not so good’ aspects
of the “Share a Coke” campaign?
 What do you think Coke’s objective is in
creating this style of campaign?
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 Consumer Culture Theory (CCT)

CCT researchers study consumption and marketplace behaviours and

focus on exploring and documenting the dynamic interrelationships
between marketplace resources, cultural myths and ideologies,
sociological and institutional structures and consumer identity projects.

Interested in:
• Market-made commodities and
desire-inducing marketing symbols.
• Commercially produced images
• Social situations, social roles and
relationships
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Source: Arnould, E.J. & Thompson, C.J. (2005). “Consumer Culture Theory (CCT): Twenty Years of Research”. Journal of Consumer Research, 31(4), pp. 868-882.
 CCT: Marketplace cultures

 Consumers interact with the

marketplace to satisfy their
needs and wants.
 Consumers become
influencers and producers of
culture.
 (e.g., dynamics embedded in
brand communities; subcultures;
consumer tribes; marketplace
social links & relationships, etc.)
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Source: Arnould, E.J. & Thompson, C.J. (2005). “Consumer Culture Theory (CCT): Twenty Years of Research”. Journal of Consumer Research, 31(4), pp. 868-882.
 Tough Mudder: A research
perspective

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Source: http://juliencayla.com/ . Downloaded: 10 February 2017

(Discussion 4: Buying Pain)
(we’ll do this next week)

What do you know about “Tough Mudder”?

1. What are consumers buying through participation in
these events?
2. How can marketers strategically contribute to this?

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 What to take away

 Key aspects of behavioural economics can be applied

to understanding consumer behaviour; and is applied
to real-life issues and problems.
 Choice architecture, nudging, mental accounting,
default setting, priming
 Recognise that marketers sell “experiences” and
achieve this by tapping into consumers’ hedonic wants
and desires.
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 FEQs for Week 2 & 3

 Explain the “theory of nudging”. What behavioural insights does this

approach apply to influence consumer behaviour? Use a behaviour
change examples to explain the differences between automatic and
reflective systems; mental accounting, priming, default settings.
 Using a current marketing example, explain experiential consumption
and how it influences consumer thoughts and feelings.
 Explain how mobile technologies change consumer behaviour. How
would you categorise mobile technology as an innovation? Consider
how mobile technology might be used by food retailers to encourage
consumers to shop in their store. What are the pros and cons for
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companies using mobile technology to market to customers?
 Next week – Week 3

Lecture topic for discussion:

 Group discussion for consumer culture theory (CCT)

 The nature of innovation and why innovations are adopted and rejected

 Briefing on Assessment 1
• Structure and components
• Sample topics
• Formulation of research problem & questions
• Preparing to collect data and ethical requirements
• Qualitative (interview) vs. quantitative (survey) methods
Additional reading

Arnould, E.J. & Thompson, C.J. (2005). “Consumer Culture Theory

(CCT): Twenty Years of Research”. Journal of Consumer Research,
31(4), pp. 868-882.

Hudson, L.A. & Ozanne, J. (1998, March). Alterative ways of seeking

knowledge in consumer research. Journal of Consumer Research,
14(4), pp. 508-21.

Martin, S., (2012). “98% of HBR readers love this article”. Harvard
Business Review, October, pp. 23-25.
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