BUSML 4201 Consumer Behavior Exam I Consumer Behavior reflects the totality of consumers decisions with respect to the acquisition consumption and disposition of goods services time and ideas by humans over time Offering a product service activity or idea offered by a marketing organization to consumers 1 The Psychological Core What affects consumer behavior The internal consumer processes Motivation Problem Recognition realizing there is an unfulfilled need Information Search Identifying the necessary actions to take to solve the problem Decision Making 2 The Process of Decision Making Ability Opportunity Post Purchase Decision judgment on whether the decision i High Effort Decisions ii Low Effort Decisions made was the correct one i Does Experience Expectations expected behavior norms ideas that characterize a 3 The Consumer s Culture group of people Culture Diversity Influences i Age gender education social status all affect decision making information Symbols Values Personality Lifestyle affect decision making Reference Groups group we compare ourselves to for 4 Consumer Behavior Outcomes external signs we use to express our identity i Ex North Face jacket Consumer Behavior Methods How to Study consumer behavior Intuition and Introspection alone cannot always provide real insight o Data is needed Primary vs Secondary Data Primary Data collected specifically for the purpose of solving the problem at hand Ex Experiments Interviews Focus Groups etc Secondary Data collected for some other purpose than the problem at hand Ex External census Gallup polls etc Internal past records sales data etc Rule of Thumb Collect secondary data first then primary Experimental Research used to test hypotheses about causal relationships between variables 3 Factors Necessary for Causation 1 Correlation 2 Temporal Antecedence the cause has to precede the effect 3 No 3rd factor driving both supposed cause and effect Motivation Ability Opportunity Motivation inner state of arousal Provides energy needed to achieve a goal What Affects Motivation Personal Relevance Consistency with Self Concept our mental view of who we are Has potentially significant consequences or implications something that has direct bearing on the self o Ex Buying clothes to fit your style Values beliefs about what is good right important Needs internal state of tension Some kind of Risk is involved o Ideal State Desired State o Performance risks o Physical Risks o Social risks o Etc Needs vs Wants Need a discrepancy Values beliefs about what is good right important Goal objectives that we would like to achieve when needs motivate us Wants form of consumption used to satisfy needs Means End Chain Attributes Consequences Values Attributes concrete abstract Consequences functional psychological Values instrumental terminal Why do firms need to understand consumers needs Segment based on needs Develop need satisfying offerings Enhance communication effectiveness Consumers don t buy products they buy things that satisfy needs Firms can move actual state downward or ideal state upward Needs Recognition occurs when consume sees a difference in PERCEIVED and IDEAL state or Change the Perceived Actual state Change Desired Ideal state Ability Opportunity Exposure Attention Perception Exposure consumer comes into physical contact with stimulus Possibly may notice More likely to notice when o Back cover of magazine o After certain articles o Beginning or end of commercial break o During certain TV events Selective Exposure when stimulus comes into range of someone s sensory receptors Ex Zipping and Zapping Attention the extent to which processing activity is devoted to a particular stimulus The information has actually been recorded in some way Characteristics Selective we decide what we want to focus on Divided can focus on more than one thing at a time Limited we don t have infinite Voluntary vs Involuntary Attention Voluntary Personal Relevance Involuntary Surprising Pleasant Prominent Perception developing an interpretation of a stimulus Perception is constructive based on our expectations Ex Instant coffee regular coffee in blind taste tests Yet women thought instant coffee was for unfit housewives Based on prior knowledge expectations Perception Threshold the level when a stimulus is detected JND Just Noticeable Difference Threshold Weber s Law K s S K constant of proportionality s smallest change capable of being detected S original stimulus value Ex a 3 price change won t be noticed on a 300 purchase but it will on a 6 purchase Categorization Comprehension Categorization when consumers use prior knowledge to label identify classify something new Why Do We Categorize It Helps us learn Taxonomic Category grouping similar objects into the same category The objects have similar features Sharing within categories Sharing across categories 1 Superordinate 2 Basic 3 Subordinate 3 Levels Ex Soda Ex Beverages Ex Mountain Dew Prototype the best example of a category Experts people whose prior knowledge is well developed more categories more subordinate level categories Goal Derived Categories contain things we see relevant to a goal Ex Things you would do during the vacation Comprehension extracting meaning from categorization Objective to communicate Subjective accurate do consumers understand the message marketers intend what do they understand regardless of whether it is