MCS 2600 In Class Notes Chapter 3: Dogmatism

- A personality train that reflects the degree of rigidity a person displays toward the unfamiliar and toward information that is contrary to his or her own established beliefs

Ranges on continuum for inner directedness to other directedness

- Inner directedness o Rely on own values when evaluating products

- Other directedness o Look to others

Need for uniqueness - An individual’s pursuit of differentness relative to others that is achieved through the

acquisition of consumer goods in order to enhance one’s personal and social identity - Consumers who avoid conforming to expectations or standards of others

Optimum Stimulation level - A personality trait that measures the level or amount of novelty or complexity that

individuals seek in their personal experiences - High OSL consumers tend to accept risk and novel products more readily than low OSL

consumers Sensation Seeking

- The need for varied novel and complex sensations and experience and the willingness to take social and physical risks for the sensations

Cognitive Personality Factors - A need for cognition(NFC)

o A persons craving for enjoyment of thinking o Individual with high NFC more likely to respond to ads rich in product

information Cognitive Personality Factors

- Visualizers vs Verbalizers Fixated Consumption: Refers to collectors and hobbyists tendency to accumulate items that are related to their interests and show them off to friends and other with similar interests

o Passion for category o Willingness to invest effort o Willingness to invest time and money o Aggressively competes in auctions

Compulsive Consumption: Addictive and out of control buying that often has damaging consequences for both the compulsive shopper and those around him or her Materialism

- Attachment to wordily possessions - Is a train of people how feel their possessions are essential to their identity? - Traits

o Acquire and show off possessions o Self centered and selfish o Seek lifestyle full of possession o Do not get greater personal satisfaction from possessions

Consumer ethnocentrism and Cosmopolitanism *** - Consumer likely hood to accept or reject foreign made products - Ethnocentric consumers feel wrong to purchase products out of economy - Cosmpolitan orientation consider the world their market place

Brand Personality - Personality like traits associated with brands - Brand personality that is strong and favorable will strengthen a brand but not

necessarily demand a price premium Product Anthropomorphism and Brand Personification

- Product anthropomorphism o Attributing human characteristics to objects

▪ Tony the tiger and Mr. peanut - Brand Personification

o Consumers perception of brands attributes for a human like character

Product Personality Issues

- Gender - Geographically - Color

Self and Self Image - Consumer have a variety of enduring images of themselves

Makeup of the self-Image - Contains traits skills habits possessions relationships and way of behavior

- Developed through background experience and interaction with others - Consumers select products congruent with this image

Difference Self Image *** - Actual Self Image: How consumers see themselves - Ideal Self Image - Social Self Image: How consumers feel people see them - Ideal Social Image - Expected Self Image - Out to self: Traits an individual believes are in her duty to possess

How are possessions being extensions of the self? - Actually by allowing the person to do things that otherwise would be very difficult or

impossible to accomplish - Symbolically making the person feel better - Conferring status - Feelings or immortality leaving valued possessions to young family

Altering the self-image - Consumers use self-altering products to express individualism by:

o Creating new self o Maintaining the existing self o Extending the self

How do consumers use self-altering products - Consumers use self-altering products to express their new selves

Vanity - Physical Vanity: Loves self-physical appearance - Achievement vanity: Excessive concern with one’s personal achievements

Chapter 4 Perception****

- The process by which an individual select, organizes and interprets stimuli into a meangful and coherent picture of the world

- Elements of perception o Sensation o Absolute threshold o Differential threshold o Subliminal Perception

Sensation: is the immediate and direct response of the sensory organs to stimuli - A stimulus is any unit of input to any of the senses

Absolute threshold - The lowest level at which an individual can experience a sensation

Sensory Adaption - Refers specifically to getting used to certain sensations or becoming accustomed to a

certain level of stimulation - Sensory adaption is a problem that causes many ads to change they ads campaigns

Differential Threshold (Just noticeable difference) **** - Minimal difference that can be detected between two similar stimuli

- Weber’s law o The and between two stimuli is not an absolute amount but an amount relative

to the intensity of the first stimulus o The stronger the initial stimulus the greater the additional intensity needed for

the second stimulus to be perceived Difference between absolute and differential threshold**** Ambush Marketing

- Placing ads in places where consumers do not expect to see them and cannot readily avoid them*****

Experiential Marketing** - Allows customers to engage and interact with offering in sensory ways in order to create

emotional bonds between consumers and marketing offerings Subliminal Perception

- Stimuli that are too weak or too brief to be consciously seen or heard o They may be strong enough to be perceived by one or more receptors

- Is it effective o No evidence if it works or not

Aspects of Perception - Selection

o Organizational ▪ Into

Selections Depends Upon: - Nature of the stimulus - Expectations - Motives

Contrast - One of the most attention compelling attributes of a stimulus - Advertisers use color contrasts size unexpected and unrealistic images to create gain

attention Perceptual Selections Important concepts****

- Selective Exposure o Consumers seek out messages which: are pleasant, that can sympathize with

- Selective Attention o Heightened awareness when stimuli meet their needs

- Perceptual Defense o Screening out of stimuli that are threatening

- Perceptual Blocking o Consumers avoid being bombarded by: tuning out, Netflix

Perceptual Organization - Gestalt Psychology: is the name of the school of psychology that first developed the

basic principles of perceptual organization Organization

- Principles:

o Figure and ground (People tend to organize perceptions into figure and ground relationships)

o Grouping (People group stimuli to form a unified impression or concept) (Helps memory and recall)

o Closure (People have a need for closure and organize perceptions to form a complete a picture

Stereotypes: - Physical - Descriptive - First Impressions - Halo Effect (perceive and evaluate multiple objects basted on one product)

Product Positioning - Establishing a specific image for a brand in the consumer’s mind in relation to

competing brands - Conveys the product in terms of how it fulfills a need - Successful positioning creates a distinctive positive brand image

Packaging as a Positioning Element - Packaging conveys the image that the brand communicates to the buyer - Color, weight image, shape etc.

Perceptual Mapping - An analytical technique that enables marketers to graphically plot consumer’s

perceptions concerning product attributes of specific brands Positioning of Services

- Image is a key factor for services - Services often want a differentiated positioning strategy to market several versions

Perceived Price and Perceived Quality - Reference Prices- Used as a basis for comparison - Perceived Quality of Products

o Intrinsic(rational) vs Extrinsic(emotional) cues*** Price/ Quality Relationship

- The perception of price as an indicator of product quality Perceived Risk

- The degree of uncertainty perceived by the consumer as to the consequences of a specific purchase decision***

o Functional Risk o Physical Risk o Financial Risk o Psychological Risk o Time Risk

Chapter 4 The Elements of Perception

- Raw sensory input by itself does not produce or explain the coherent picture of the world that most adults possess

- Perception is the result of two different kinds of inputs that interact to form the personal pictures

o One type of input is physical stimuli from the outside environment the other consists of people’s expectations motives

Sensory Input - Sensation is the immediate and direct response of the sensory organs to stimuli. - Stimulus is any unit of input of any of the sense - Sensory receptors are the human organs that receive sensory inputs

The Absolute Threshold - The lowest level at which an individual can experience a sensation is called the absolute

threshold - Sensory adaption is getting used to certain sensations - Many of the promotional methods aimed at increasing sensory input take the form of

ambush marketing or experiential marketing Ambush Marketing

- Consists of placing ads in places where consumers do not expect to see them and cannot readily avoid them

Experiential Marketing - Allows customers to engage and interact with brands, products and services in sensory

ways in order to create emotional bonds between consumers and marketing offerings The Differential Threshold

- Two similar stimuli o Differential threshold o Just Noticeable difference

- That the JND between two stimuli was not an absolute amount but an amount relative to the intensity of the first stimulus

- Websers law as it has come to be known states that the stronger the initial stimulus the greater the additional intensity needed for the second stimulus to be perceived as different

The JNDS Implications for Product Pricing and Improvement - First they want to prevent changes from becoming readily discernible to the public - Second they way to ensure that product improvement are very apparent to consumers

but without being wastefully extravagant - Marketers use the JND to determine the amount of improvement they should make in

their products - Improvements below the JND will not be perceived and will hurt the credibility of a

marketer promoting the product as new and improved The JNDS implications for logos and Packaging

- Markets who do not consider the impact of the JND when introducing new logos may anger their loyal customers

Subliminal Perception - Stimuli that are too weak or too brief to be consciously seen or heard may nevertheless

be strong enough to be perceived by one or more receptors cells.

o This process is called subliminal perception because this stimulus is beneath the threshold or limen

- No evidence that subliminal advertising persuades people to buy goods or services - Tangential indication that subliminal advertising may reduce antisocial behavior

Perceptual Selection - Which stimuli get selected depends on two major factors in addition to the nature of the

stimulus itself o Consumers previous experience as it affects their expectations o Their motives at the time

The Stimulus - Contrast is one of the most attention compelling attributes of a stimulus

Motives - The stronger the need the greater the tendency to ignore unrelated stimuli in the

environment Selective Perception

- Perceptual defense takes place when consumers subconsciously screen out stimuli that they find psychologically threatening even though exposure has already taken place

- One way to combat perceptual defense is to vary and increase the amount of sensory input

Perceptual Organization - The principles underlying perceptual organization are often called Gestalt psychology.

Three of the basic principles of perceptual organization are figure and ground grouping and closure

Figure and Ground - The term figure and ground refers to the interrelationship between the stimulus itself

and the environment or context within which it appears - The ground usually perceived as indefinite hazy and continuous. - The figure of ground is generally attributed to the figure rather than to the ground

which helps give the figure greater definition Grouping

- Refers to people’s instinctive tendency to group stimuli together so that they become a unified picture or impression

Closure - Is people’s instinct to organize pieces of sensory input into a complete image or feeling.

Individuals need closure which means that if they perceive a stimulus as incomplete - Ads that include closure

o Asking consumers to unscramble words o Showing pictures and asking consumers to name items shown o Including words with missing letters and ask the consumer to fill in blanks

Perceptual Interpretation Stereotyping - Some stimuli are weak because of such factors as poor visibility brief exposure high

noise level or constant fluctuation. When stimuli are highly ambiguous - There are many reasons behind stereotyping. Generally, people stereotype because it

makes the processing of sensory input quicker and easier

- The triggers of stereotyping are physical appearance descriptive terms first impression and the halo effect

Halo Effect - Refers to the overall evaluation of an object that is based on the evaluation of just one

or a few dimensions - The lucrative field of licensing is based on the halo effect

Consumer Imagery - Refers to consumer’s perceptions of all the components of products services and brands

and to how consumer evaluate the quality of marketer’s offerings Service Image

- Because services are intangible image becomes a key factor in differentiating a service from its competition

Perceived Price - Is the customers view on the value that he or she receives from the purchase - Reference prices are external or internal - Naturally tend to believe that the selling prices of market offerings are considerably

higher than their perceived fair prices Perceived Quality

- If consumers do not perceive offerings as superior products that satisfy their needs and provide value, they will not purchase them regardless of objective evidence

- Some of these cues are intrinsic to the product or service others are extrinsic Product Quality

- Intrinsic cues are physical charactertics of the product itself such as size color flavor or aroma. In some cases, consumers use physical characteristics

- More often than not however consumers use extrinsic cues that is characteristics that are not inherent in the product

Service Quality - It is more difficult for consumers to evaluate the quality of services than the quality of

products - They are intangible they are variable they are perishable and they are simultaneously

produced and consumed - The servqual scale measures the gaps between customers’ expectations of the services

that they had purchased and they perceptions of the services that they had actually received. It includes two factors

o Outcome o Processes which focuses on how the core services were delivered

Price and quality - Some price/quality perceptions are related to personal happiness

Store image and Perceived Quality Manufacturers Image and Perceived Quality

- Institutional advertising the promotion that is designed to promote a company’s overall image without overtly referring to specific products

Perceived Risk

- Is the uncertainty that consumers face when they cannot foresee the consequences of their purchase decisions

- Risk that is not perceived will not influence consumer behavior Perceived Risk Varies

- High Risk perceivers are often described as narrow categorizers because they limit their choices to a few safe alternatives

- They would rather exclude some perfectly good alternatives than chance a poor selection

- Low risk perceivers have been described as broad categorizers because they tend to make their choices from a much wider range of alternatives. They would rather risk a poor selection than limit the number of alternatives from which they can choose

Elements of Perceived Risk

- Functional Risk - Physical Risk - Financial Risk - Psychological Risk - Time Risk

Consumers Can reduce Perceived Risks - Seek Information - Remain brand loyal - Rely on Brand image - Rely on store image - Buy the most expensive brand

Chapter 5 Leaning

- The process of applying ones past knowledge and experience to present circumstances and behavior

o Marketers are concerned with how individuals learn because they want to teach them

▪ About products ▪ Product attributes ▪ Where to buy ▪ How to use them

Elements of Learning Theories - Motivation - Cues - Response - Reinforcement

Two Major Learning Theories - Behavioral Learning

o Based on observable behaviors that occur as the result of exposure to stimuli

▪ Classical Conditioning: an automatic response that builds up through repeated exposure and reinforcement (pavlovs dogs)

• Repetition (increases the association between the conditioned and unconditioned stimulus) (slows the pace of forgetting) (Advertising wear our is a problem)

• Stimulus Generalization (Having the same response to slightly different stimuli) (Helps “me too” products to succeed”) (useful in (product extensions)

• Stimulus Discrimination (Selection of a specific stimulus from a similar stimuli) (Opposite of stimulus generalization) (Discrimination is the basis of positioning which looks for unique ways to fill needs)

▪ Instrumental conditioning: a behavioral theory of learning based on a trial and error process with habits forced as the result of positive experiences resulting from certain responses or behavior (bf skinner) ***

- Cognitive Learning

Reinforcement of behavior - Positive and negative Strategic Applications of Instrumental Conditioning - Customer satisfaction - Reinforcement schedules - Shaping - Massed versus distributed learning

Observational Learning (modeling of vicarious learning) - A process by which individuals learn behavior by observing the behavior of others and

the consequences of such behavior Information Processing and Cognitive Learning

- Cognitive Learning o Learning involves complex mental processing of information

Sensory Input Working Memory Long Term Store Retrieval Tri Component Attitude Model***

- Cognitive Stage: person’s knowledge and beliefs about a product - Affective Stage: Feelings toward buying - Conative Stage: Intention to buy

Involvement - Degree of personal relevance that the product or purchase holds for that customer - High involvement purchases are very important to the consumer - Low involvement holds little relevance

Central and Peripheral Routes to Persuasions - Central route to persuasions

o High involvement purchases o Requires cognitive processing

- Peripheral route to persuasions o Low involvement o Consumer loss motivated to think

Hemisphere Lateralization and Passive Learning - Hemisphere lateralization

o Also called split brain theory - Left brain

o Rational o Active o Realistic

- Right brain o Emotional o Metaphoric o Impulsive o Intuitive

Hemispheral Lateralization - Right brain theory is consistent with classical conditioning and stresses the importance

of the visual component of advertising - Printed information is verbal information is processed on the brains left side - You want a balance

Measures of Consumer Learning Brand loyalty - Recognition and Recall Measures

o Aided Recall(recognition) o Unaided Recall ()

Brand Loyalty*** - The ultimate desired outcome of consumer learning and measures purchase frequency

brand switching and commitment to buy the brand - Depends on

o Risk aversion o Brand reputation o Social influence

Types of Brand Loyalty** - Covertous loyalty- No purchase but strong attachment toward the brand that was

developed from the person’s social environment - Inertia Loyalty: purchasing the brand because of habit and convenience but without an

emotional attachment - Premium loyalty: high attachment to the brand and high repeat purchase

Brand Equity *** - The intrinsic value of a brand name. This value stems from the foundations of brand

loyalty: the consumer’s perception of the brands superiority the social esteem that using it provides

Chapter Seven/Nine Persuading Consumer & Reference Groups

Basic Communication Model Sender Message Channel Receiver feedback Communications

- Impersonal o Marketing departments, advertising, PR

- Interpersonal o Formal(salesperson) o Informal sources(family)

Source Credibility - A sources persuasive impact, stemming from its perceived expertise, trustworthiness,

and believability Family = Most Important Reference group The source- Impersonal and Interpersonal Communications

- Source credibility - Reference groups

o Normative influence consists of learning and adopting a groups norm, values and behaviors

o Comparative Influence arises when people compare themselves to other whom they respect and admire someone(celebrity)

o A group of which a person belongs to or realistically can join, is called membership group

o A symbolic group is a group to which an individual is unlikely to belong (but adopts)

Consumption Related Reference Groups - Friendship groups - Shopping Groups - Virtual Communities - Advocy groups

Factors affecting Reference Group Influence - Conformity

o Influence its members a reference groups must: ▪ Inform members that the brand product exists ▪ Provide opportunity compare

- Group power and expertise - Relevant Information and experiences - Product conscious The Source: Word of Mouth – Strategic Applications - Buzz Agents (amps up the product) Vs Brand Terrorists(trolls) Adopter Categories - Innovators - Early Adopters - Early Majority

- Late Majority - Laggards

Credibility of Formal Sources Endorser Effectiveness - Effectiveness is related to the message and its ease of comprehension - Congruency between the endorser and the product types is important - Endorsers demographic characteristics should be similar to the target - Endorser credibility is not a substitute for corporate credibility - Endorsers words must be realistic for them - Vendor Credibility (reputation of the retailers) - Medium Credibility (the credibility of the magazine - Effects the time (The sleeper effect phenomenon when the consumer does not

remember the source) The Receivers as the Target Audience

- Personal characteristics and motives - Involvement and congruency - Mood

Overcoming Psychological Noise - Repeating exposure to advertising message - Contrast to break through clutter - Customized promotion message - Effective positioning - Offering unique value propositions

Media(channel) - Mass media - Non-traditional (media is:

o Addressable o Interactive o Response measurable

Non Traditional Media - Out of home and on the go

o Billboards o Ambient advertising (in new places)

- Online and Mobile Designing Persuasive Communications

- Message Structure and Presentation o Message framing (negative and positive framing)

- One Sided Versus Two Sided Messages (Depends on nature of the audience and nature of competition)

- Order effects(primacy)(recency) (Order of benefits) - Brand Name

Fear/ Threatening Appeals 1. Understand reaction and previous experiences 2. Beware of the boomerang effect 3. Behavior change is long and complex process

4. Study relationship with action and anxiety 5. Determine whether rational or emotional threat/fear appeal 6. Repeat advertising over the long term 7. Accept that some addicts may not respond 8. Consider alternatives

Types of Celebrity Appeals*** Testimonial Based on person usage

Endorsement Celebrity lends his or her name appears on behalf of product(may not be expert)

Actor Celebrity presents a product or service as part of character

Spokesperson Very open about involvement

Feedback Determine Effectiveness

- Exposure effects: how many consumers received the message - Persuasion effects: was the message received and interpreted correctly - Sales effects: did the ads increase sales

Chapter 6 Consumer Attitude Formation and Change Attitude: A learned predisposition to behave in a consistently favorable or unfavorable manner with respect to a given object What are Attitudes

- The attitude “object” o Attitudes are directed at objects. Object refers to such things as: product,

product category, brand, service, possessions, product use, causes or issues, people advertisement price, Internet site, price, medium, or retailer. Attitude “can be conceptualized as a summary evaluation of an object.”

- Attitudes are a learned predisposition - Attitudes have consistency - Attitudes occur within a situation

Structural models of attitudes - Tri Component Attitude Model

o Cognitive (the knowledge and perceptions that are acquired by a combination of a direct experience with the attitude object and related information from various sources)

o Affective (A consumer’s emotions or feelings about a particular product or brand)

o Conative (the likelihood or tendency that an individual will undertake a specific action or behave in a particular way with regard to the attitude of object)

- Multi Attribute attitude model: attitude models that examine the composition of consumer attitudes in terms of selected product attributes or beliefs

o The attitude toward object model (attitude is function of the presence of certain beliefs or attributes) (Useful to measure attitudes toward product and service categories or specific brands)

o The attitude toward behavior model (is the attitude toward behaving or acting with respect to an object, rather than the attitude toward the object itself) (corresponds closely to actual behavior)

o Theory of reasoned action model (includes cognitive affective and conative components) (includes subjective norms in addition to attitude)

▪ Subjective norms are based on normative beliefs and motivation to comply with the preferences of relevant others

- The Trying to consume Model: An attitude designed to account for the many cases where the action or outcome is not certain but instead reflects the consumers attempt to consume

- Attitude toward the ad model: a model that proposes that a consumer forms various feelings(affects) and judgments(cognitions) as the result of exposure to an advertisement which in turn affect the consumer’s attitude toward the ad and attitude toward the brand

Issues in Attitude Formation - How attitudes are learned

o Conditioning and experiences o Knowledge and beliefs

- Sources of influence on attitude formation o Personal experience o Influence of family o Direct marketing and mass media

- Personality factors o Need for cognition o Innovativeness

Strategies of Attitude Change - Changing the basic motivational function - Associating the product with an admired group or event - Resolving two conflicting attitudes - Altering components of the multi attribute model - Changing beliefs about competitor’s brands

Changing the basic motivational function - The utilitarian function stems from the belief that consumers’ attitudes reflect the

utilities that brands provide. When a product has been useful or enabled us to perform certain tasks in the past, our attitude toward it tends to be favorable.

- The ego-defensive function maintains that people form attitudes in order to protect themselves from sensing doubt and to replace uncertainty with feelings of security and confidence.

- The value-expressive function maintains that attitudes reflect consumers’ values and beliefs.

- The knowledge function holds that people form attitudes because they have a strong

need to understand the characters of the people, events, and objects they encounter.

What Products that you purchase associate themselves with an admired group? *** When Does it personally influence your purchasing?** Attitude Change

- Altering Components of multi attribute model o Changing relative evaluation of attributes o Changing brand beliefs o Adding an attribute o Changing the overall brand rating

- Changing beliefs about competitor’s brands Elaboration Likelihood Model(ELM): customer attitudes are changed by two distinctly different routes to a persuasion: a central route or a peripheral route

Behavior Can Precede or Follow Attitude Formation

- Cognitive Dissonancy Theory o Holds the discomfort or dissonance occurs when a consumer holds conflicting

thoughts about a belief or an attitude object o Cognitive dissonance theory and attribution theory provide different

explanations as to why and how behavior sometimes precedes attitude formation.

- Attribution Theory o A theory concerned with how people assign causality to events and form or alter

their attitudes as an outcome of assessing their own or other people’s behavior Post Purchase Dissonance (Ways to reduce)

- Rationalize decisions - Seek advertisements that support choices - Try to sell friends on the positive features of the purchase made - Look to satisfied owners for reassurance

Internal Vs External Attribution

- Self-perception attribution addresses individuals’ inferences or judgments as to the cause of their own behavior

Defensive Attribution - Consumers are likely to accept credit personally for success and to credit failures to

others Attribution Theory

- Self-Perception Theory o the foot-in-the-door technique is based on the premise that individuals look at

their prior behaviours (e.g., compliance with a minor request) and conclude that they are the kind of person who says “Yes” to such requests (i.e., an internal attribution). Example: use of a coupon

- Attitude towards others o Every time a person asks “Why?” about a statement or action of another or

“others”—a family member, a friend, a salesperson, a direct marketer, a shipping company— attributions toward others theory is relevant.

- Attitudes toward objects o It is in the area of judging product performance that consumers are most likely

to form product attributions toward objects. - How we test our attributions

o Distinctiveness o Consistency over time o Consensus

ON MIDTERM:

- Maslow’s - Different types of segmentation - Go through first two chapters - Chapter 16(little bit) (conducting research) (know terms) - Know the models (in slides) - Be able to define models (attitude and formation to change) - High need for cognition - Persuasions - High involvement and low envloment - Freudian - Description of learning - Difference between absolute threshold and …. - Selective attention and exposure - Difference cognitive and behavioural theories (know your theorists) - Variety seeking, sensation seeking - Scenario type questions - Different types of sources