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122 Cards in this Set
- Front
- Back
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demographic segmentation
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age
sex socio-economic status (SES) geodemographic segmentation |
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Types of market segmentation
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geographic
demographic psychological segmentation by usage segmentation by benefit |
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Product lifecycle
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introduction
growth maturity saturation decline |
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school of research
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positivist
interpretivist |
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Definition of consumer behaviour
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The mental, emotional and physical activities that people engage in when
selecting, purchasing, using, and disposing of products and services so as to satisfy needs and desires. |
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Positivist approach assumptions
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All behaviour has objectively identifiable causes and effects, which can be
isolated, studied and measured. • When faced with a problem or a decision people process all the relevant information available to deal with it. • After processing this information people make a rational decision about the best choice to take or decision to make. |
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Interpretivist approach assumptions
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Cause and effect cannot be isolated because there is no single objective
reality everyone can agree on; • Reality is an individual’s subjective experience of it, so each consumer’s experience is unique; • People are not simply, or always, rational information processors or decision makers, because this view takes no account of an individual’s emotional life (what has been called fantasies, feelings and fun). |
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Difference between consumer and customer
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The term customer usually implies a relationship over
time between the buyer and a particular brand or retail outlet. |
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Demographic trends
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The population is ageing.
Members of the postwar baby boom are now middleaged. The proportion of young people in the population, especially between 15–20 years, is declining. • Average household sizes have declined, with a great increase in oneperson households. • Women are having fewer children and giving birth later in life. |
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Geodemographic segmentation definition
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Geodemographic implies, this segment is based
on the idea that people who live in the same neighbourhood will tend to be of the same Socioeconomic Status, and where each of the three SES factors of income, education and occupation will also be similar. |
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Psychological segmentation areas of behaviour
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Activities How do people spend their time? (for example, work,
entertainment, shopping) Interests What are people most interested in? (for example, family, job, recreation, food) Opinions How do people view themselves and their world? (for example, politics, business, education, the future). |
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What did the marketing concept do
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marketing concept did was to provide a focus for a changing
producer orientation from one of unthinking control and dominance of the producerconsumer relationship to one of greater sophistication. |
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Market conditions for segmentation to work
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identity
access size |
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Product characteristics which determine customer response
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Relative advantage
• Compatibility • Complexity • Trialability • Observability |
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Levitt’s Total Product Concept
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Generic product.
Expected product. Augmented product. Potential product. |
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Areas of risk
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1. Performance – will it do what it is supposed to?
2. Financial – will it be worth the money? 3. Physical – will it be safe? 4. Time – Will it be time-consuming to return? 5. Social – Even if she likes the suit, will the office? 6. Psychological – Is it me? |
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Types of self image
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Actual self image: the traditional concept of how people actually
see themselves Ideal self image: how people would like to see themselves Social self image: how people think others see them Ideal social self image: how people would like others to see them |
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Personality theories
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Freudian
Neo-freudian Self Trait Brand |
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Definition of learning
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Learning is the relatively permanent process by which changes in behaviour,
knowledge, feelings or attitudes occur as the result of prior experience. |
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Learning approaches
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Behaviourist approach
Cognitive approach |
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Types of conditioning
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Classical (Pavlov)
Operant (Skinner) |
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Component of the socioeconomic status SES
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education
income occupation |
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Component of psychological segmentation
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Activities
Interests Opinions |
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Components of segmentation by usage
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Volume of purchase
Frequency of purchase Occasion |
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Definition of Diffusion of new products
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the process by which an innovation . . . is communicated through certain channels
over time among the members of a social system. |
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distribution of adoption
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Innovators
early adopters early majority late majority laggards |
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Components of the individual perspective
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perception
personality learning, memory and thinking motivation |
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Theory X
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People are inherently lazy so they must be motivated by external incentives
• They will pursue their own goals, which run counter to those of the organisation, so they need extra controls to keep them in line • They are quite irrational and incapable of selfdiscipline or selfcontrol • The rare individuals who are rational, controlled and selfmotivated will therefore have to manage others. |
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Theory Y
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People seek meaning and a sense of accomplishment and to exercise autonomy and be independent in their work
• As they are basically controlled and selfmotivated they will find external controls and incentives demeaning • If they are only given the chance to do so they will come to regard the organisation’s goals as their own. |
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Definition of motivation
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A general term for any part of the hypothetical psychological process which
involves the experiencing of needs and drives and the behaviour that leads to the goal which satisfies them. |
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Buying behaviour =
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Ability + Opportunity + Motivation
BB = f(A,O, M) |
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Maslow hierarchy of needs
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self-actualisation needs
self-esteem needs social needs safety needs Physiological needs |
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Types of conflict
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approach - approach
avoidance - avoidance approach - avoidance |
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Types of needs
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achievement
affiliation power |
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Instituations that have the most influence on our socialization
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family
school nation-state |
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Roles in family purchasing decision
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iinitiator
influencer decision-maker buyer user gatekeeper |
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strategies for family conflict resolution
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coercion
persuasion bargaining manipulation |
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Consumer life-cycles stages
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• Bachelor unmarried person under 35
• Newly married under 35, no children • Full nest I married, youngest child under 6 • Full nest II married, youngest child 6–12 • Full nest III married, youngest child in teens • Empty nest I married, children left home • Empty nest II married, child left home, retired • Solitary survivor widow(er), children left home, still working • Retired solitary survivor As above but retired |
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Stages of development (Piaget)
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Sensory Motor Stage (birth to two years)
Preoperational Stage (two to seven years) Concrete Operations Stage (seven to eleven years) Formal Operations Stage (11 years on) |
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Definition of assimilation
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children assimilate new information about the world into their cognitive
system, their existing way of thinking. |
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Definition of adaptation
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children’s existing way of thinking is not
sufficiently complex to let them make sense of some new information. |
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threephase model of development
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I. pre-economic
II. micro-economic III. macro-economic |
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External Influences on Consumer Socialisation
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parent
school social norms marketing and advertising |
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Types of groups
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Primary and Secondary Groups
Formal and Informal Groups Membership and Reference Groups |
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Factors influencing the effectiveness of status symbols
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Exclusivity – only a few people should be eligible to acquire it
• It should be relatively expensive • It should be of good quality • It should be of limited supply • It should be used by honoured and respected people |
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Methods for measuring social class
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objective
subjective reputational |
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Social values - Ideal factors
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individualism
equality humanitarianism youthfulness social conformity |
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Social values - actualities
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materialism
progress, achievement and success efficiency and practicality activity mastery of environment |
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attitude components
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cognitive
affective conative |
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sources of attitudes
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family
peers direct experience |
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changing Attitudes
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Mere exposure
Persuasive communication. Cognitive dissonance. |
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parts of the process of communication
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source of the communication
the communication itself the audience |
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Heuristics used in decision-making
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the representative heuristic, the attitude heuristic
the availability heuristic. |
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Consumer Decision Process
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Recognising problem
Internal information search External information search Evaluating alternatives Purchase processes |
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major factors that influence their choice of store
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location,
layout, merchandising service. |
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Consumer rights
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1 Safety.
2 Be informed. 3 Choose. 4 Be heard. 5 A clean environment. 6 Privacy. |
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Coping with risks
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Information Gathering
Relying on brand loyalty Some official seal of approval The image of a major new brand The image of the store |
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antecedants causing a consumer to act on a problem
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Changing circumstances
Depleted stock Dissatisfaction with stock Marketing influences Product add-ons |
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Threshold of awareness definition
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Absolute threshold, marks the difference between sensing and not sensing
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Just noticeable difference
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Minimum amount of difference one can detect
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price just noticeable threshold
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15 to 20%
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Common properties of the sense
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Threshold of awareness
Sensory adaptation |
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Illusions
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Figure and ground
Grouping Closure |
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Gestalt psychology
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Whole is more than the parts, we search for meaning, patterns
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Perceptual constancy
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Our perception of things remain constant.
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The Representative Heuristic
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pick out something familiar in a new object and then equate its similarity with one we know.
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The Attitude Heuristic
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Starting off with liking or disliking a product then believing what we would want to be true about it,
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Availability Heuristic
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estimating the likelihood of something occurring using the availability of relevant data from our memory.
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Illusion - figure and ground
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the way we perceive things against a background; the way we need a background before we can pick out an object in the environment.
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Illusion - grouping
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we structure our perceptions is by grouping things into patterns.
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Illusion - closure
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If certain things are familiar to us our perceptual process will close the gaps in the picture, thereby providing the necessary contour lines for us to perceive it as a distinct object.
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Zeigarnik Effect
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Because of this need to complete an incomplete picture, things that we cannot complete tend to bother us, and therefore stick in the memory.
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Reductionist Approach:
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All human behavior can be reduced to consumerism, such as a doctor-patient relationship. What is missing is the psychological content of the relationship.
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PRIZM
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Uses 40 categories to divide up Americas zip code districts From the Blue Blood estates to Public assistance to Grain Belt.
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ACORN
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Devides Britain into 38 types of Neighborhoods.
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Thelma:
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Traditionalists, devoted to husband children and home is a churchgoer has no higher education and watches a lot of TV. 25%
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Candice:
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Chic suburbanite, Highly educated and sophisticated reads and watches little TV. 20%
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Mildred:
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Militant mother, Maried young and has children. Husband has insecure job, not happy with her lot, listens to rock and watches a lot of TV. 20%
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Cathy:
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Contented housewife, a younger version of Thelma but without the religion avoids news and looks for wholesome family entertainment. 18%
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Eleanor:
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Elegant socialite, Big city version of Candice through career rather than community. 17%
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VALS:
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(Values and Lifestyles) The most elaborate psychological segmentation classification. Was carried out in the 70’s and classified Americans into 9 categories such as Survivor, sustainer, believer, belonger, struggler. Updated in the 80’s VALS-2 reduced to 8 categories.
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Pressures that lead companies to the development of new products:
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1. Declining birth rates.
2. Technological innovation the shortening of PLC’s. 3. Pressure of organizational change and renewal. |
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Successful Innovation
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The most potent secret lies in changing some aspect, however small, of the way society is organized, which results in satisfying a demand that consumers were perhaps unaware that hey had.
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3 main types of Innovation
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1. Continuous: Modifications to existing products, new models and flavors. New model car, a new flavor of yougurt.
2. Dynamically Continuous: Requires more change in consumer behavior. Can be the modification of an existing product or the creation of a new one. Compact disks, new foods. 3. Discontinuous: Requires a new form of consumer behavior. The rarest innovations but th ones with the greatest social impact. Telephone, Radio, TV. |
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1. Freudian Psychoanalysis
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The human personality is made up of the id, ego and superego.
a. Id – raw impulses of sex and aggression. Unconscious. b. Ego – rational conscious thinking part of our personality. c. Superego – Unconscious, deals with morality our conscience. Responsible for our feelings of guilt. |
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Freud’s Developmental Stages
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a. Oral Stage – Lack of Satisfaction produces a hostile sarcastic personality and to much satisfaction a dependant gullible personality.
b. Anal Stage – Strictness leads to an anal personality and laxness leads to disorder and messiness. c. Phallic Stage – is crucial to determining ones attitudes towards people of the opposite sex and positions of authority. |
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1. Neo- Freudian Psychoanalysis
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Felt that Freud gave to much importance to biological drives. Neo-Freudians tend to de-emphasize the id in favor of the Ego.
Karen Horney states that people can be classified according to their relationships with others: 1. Compliant 2. Aggressive 3. Detached This is measured on a CAD personality scale. |
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1. Self Theory
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Centered on the work of Carl Rogers.
People try to live up to their potential. The fact that their potential so often remains unfulfilled is due to the oppressive effects of family school and other social institutions that shape the lives of the subjects. Rogers believes that people are basically rational and are motivated to be the best that they can be. |
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1. Trait Theory:
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The leading theorist is Raymond Cattell. He states that we all have characteristics called traits that are shared but we all differ on the strengths of various traits.
Cattel eventually came up with a list of 16 different factors on which he bases personality profiles. His personality test known as the 16PF is now widely used in job selection and vocational guidance. Cattell suggests that there are 3 important sources of personality data: Life data, self-report questionnaire data, and objective data from personality tests. |
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Brand Personality
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A more modest and attainable approach in marketing is the development of a brand personality. To give a product characteristics such as old fashioned, elegant rugged or masculine.
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Stimulus Generalization
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The dog would salivate not only at the usual bell but also at other bells with a similar sound.
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Stimulus Discrimination
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– The dog can be trained not to salivate at certain bells and salivate at the sound o others.
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Operant Conditioning
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– Training using conditional techniques.
Positive Reinforcement – Press the bar to get a reward. Extinction – Remove the reward to stop the behavior. Negative reinforcement – Press the bar to avoid pain. Punishment – Giving pain after an undesirable action. |
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Consumer Applications of Operant Conditioning
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It is important at all cost that consumers are not punished (get a bad product) after a purchase.
There is no cheaper form of positive reinforcement than saying thank you or following up with a thank you note. |
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The Cognitive Approach
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Was founded By Wolfgang Kohler.
The cognitive school emphasizes the importance of knowledge and insight. The greatest advantage of an insightful solution is that unlike trial and error learning it can be applied to new situations. There is a link between the psychology of perception and the psychology of learning, the concept of memory. |
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The process of committing to memory seems to involve 3 distinct stages.
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1. You register a stimuli. Less than a second.
2. Short term memory. Decide whether you want to remember the stimuli. Up to 30 seconds. 3. Long term memory. The information is processed, repeated or rehearsed so that it sticks. |
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Making Learning Meaningful
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Repetition has diminishing returns.
May be very effective when there is little competition but may cancel each other out when there is a lot of competition. Visuals are very effective. That is why symbols are used to represent brands. Self-referencing – The act of relating information to ones own life. Mnemonics – Breaking information down into groups and associating each group of information to a trigger. Meaningfulness – We learn things by linking them to thing that we already know. We organize our memories into packages called schemas. Modeling – Seeing other people doing something and using them as models for our own behavior. |
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Creating Needs
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There is no evidence that needs can be created, however existing needs can be stimulated.
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Semiotics
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The use of symbols to represent products. Symbols are much more powerful than words.
It is hard to tell what a symbol means to a particular individual. Even Freud said sometimes a cigar is just a cigar. Remember the prunes example and what they represent. |
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What is a Family?
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A group of two or more people living together who may be related by blood, marriage or adoption.
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Nuclear Family
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Immediate Family.
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Extended Family
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Grandparents cousins and the list goes on.
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Changes in Family
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The extended family is now pretty rare in western countries.
It is now also pretty rare for the man to be the sole bread winner. The rate of divorce has also increased. |
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Households
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Households are based on where people live together rather than with whom.
People living together in institutions are not considered households. People who live alone are considered a household. |
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Consumer Socialization
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Parents do not give specific training in this area they act as role models.
Co-shopping usually is a mother child thing and it is a useful way to spend time together in today’s busy world. On these trips children learn about budgeting, choosing between products, brands and quality. Co-shopping once again is a two way process. Children may become role models for their parents when shopping for such stuff as VCRs and CDs. |
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Primary groups
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Primary groups are small face to face groups, typically around 4 to 8 people. Most of us belong to several such groups as these at any given time.
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Secondary groups
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Secondary groups are to large to be considered primary usually above 20 people. Members of a dental association or of religions are examples.
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Properties of Group Life
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Unintended group influence Couples tend to have similar patterns of consumer behavior to each other, patterns that are systematically different fromother couples who met in different kinds of neighborhoods. This is an extension of Geodemographic segmentation.
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Conditions Necessary for someone to exert consumer influence:
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1. There is an ongoing personal relationship.
2. The other person is an expert or knowledgeable in the field. 3. You do not personally have the information to evaluate the product. 4. You do not trust the vendor’s sale pitch. |
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Conformity and consumer Norms
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1. Most of us feel uncomfortable if our buying behavior is out of step with the people around us for example not owning a TV.
2. People who do not mind such conformity are likely to be opinion leaders. Especially of new products and innovations. 3. It might just take the support of one other person to make conformity resistable. 4. Most of us accept some silly opinions if they seem to be the norm of our group. For example Bermuda shorts are attractive. The whole fashion industry is based on this. |
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Conspicuous Consumption
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The buying of products for what they stand for so as to claim status.
Having a carpet in your office or the key to the executive lavatory can be a matter of great importance to people. It is also a cheap way for companies to reward employees. People settle for symbols of status. For example organized crime gives to charity in order to get respect. |
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Attitude
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1. Stable – once formed will keep that form.
2. Long Lasting – will be stable over years. 3. Learned – we are not born with it. 4. Predisposition to respond – links to the actual behavior. 5. In a certain way – emphasizes consistency. |
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Forming Attitudes
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1. Classical conditioning
2. Stimulus generalization – Heinz 57 varieties. 3. Stimulus discrimination – To negate the effects of me to products. 4. Operant conditioning or reinforcement 5. Cognitive learning |
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Strategies for changing attitude
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Low consumer involvement – use an advertising blitz or conditioning.
Increasing involvement - Try to increase the consumers involvement by associating the product with a political cause or health concern. Involvement – Use the multi-attribute model a. Change beliefs – anything that claims to last the longest, be the most reliable or give the best value for the money. b. Changing Evaluations – Changing the way a consumer evaluates a product. For example baked beans have always been cheap and convenient but when consumers discovered that they were high in fiber and healthy the way they were evaluated changed. c. Changing beliefs and evaluations – Removing or adding attributes. Adding fiber to bread or removing caffeine from coffee. Adding vitamins to milk and removing it’s fat content. |
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The two most important factors in changing peoples attitudes are:
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1. Credibility – The communicator should be perceived as an expert and trustworthy. Arguing against ones own interests is especially effective! Fast smooth talkers seem to be perceived as more credible. Sleeper effect – a not so credible spokesperson gives a message. After time the sender is forgotten but the message remembered.
2. Attractiveness – Using celebrities. It is said that this technique works only up to a point on trivial issues. |
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key questions are considered in evaluating the effectiveness of the message:
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1. Reason or Emotion – Modern research looks more into the effects of different levels of emotion rather than the distinction between the two. It seems to be the combination of high emotional arousal plus specific instructions on what to do that is most effective.
2. Images or Statistics – Apparently the vividness of an individual picture is much more persuasive than words. All the cracks adding up to the size of a basketball. 3. One sided or two sided argument - For uninformed people or people that share the same opinion the one sided argument approach is more effective. For well informed people or people that don’t share the same opinion the two sided approach is more effective. 4. Primacy or Recency effect – There is an obvious relevance to the timing of adds on radio and TV with relation to the time of the purchasing decision. 5. Size of attitude discrepancy – It is much easier to change the attitudes of the target audience when there is only a small discrepancy. |
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Factors which effect the way the audience will perceive a message and how they will respond to it:
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1. Self-Esteem – It seems that people with low self-esteem are much more susceptible to persuasion. This seems to concur with Milgams and Asch’s studies.
2. Social approval – Allied to self-esteem is finding people who have a deeply felt need for social approval. 3. Prior Experience – The most important factor in audience attitude change. Inoculation and forewarning. 4. Public commitment – When people make a public commitment that jives with group norms rather than a private commitment they are more likely to change their behavior. Examples are, Kurt Lewin’s Offal studies. Tupperware parties. 5. Mood – a. Content – The add should be upbeat and happy. b. Context – The add should be placed in a program that is upbeat. |
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Why do people go shopping?
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• To get out of the house.
• To get info on what is available. • To meet friends. • To break up routine. • Exercise • To feel important as a household provider. |
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9 Images of the consumer:
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1. Chooser – The most prevalent image.
2. Communicator – The acts of buying are nonverbal communication. 3. Explorer – Hunting for bargains, exploring. 4. Identity-Seeker – Defining who one is through purchases. 5. Hedonist 6. Victim – Overcharging manipulation cartels. 7. Rebel – Younger people, Tearing jeans. 8. Activist – Greens and boycotts 9. Citizen - Political linked to a community |
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Components of the social perspective
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Family Influences
Social and Developmental Influences The Influence of Small Groups The Influence of Social Class Cultural Influences Attitudes |
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Exam question: Advertising
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1. Model of communication
- Encoding - Transmission via medium - Decoding -feedback 2. Factors affecting persuasiveness of message - Credibility a. expert b. trustworthy -attractiveness 3. Nature of communication - approval to reason or emotion - images or stats ar emore convincing? -message one-sided or two-sided -primacy or recency effect -size of discrepancy in attitude being adressed 4. Nature of the audience -self-esteem -need for social approval -previous exposure -mood 5. cultural factors - humour or ser 6. perception |
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Decision rules
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Compensatory
Non-compensationary Conjunctive Disjunctive Lexicographic Elimination |
