Advertising Management

Lecture 4: Perspectives on Consumer Behavior

Consumer Behavior

How people think about, buy, and use products as a response to MC messages

Consumer Response

• Prospects (those who have not bought the brand but who might be interested in it) vs. Current Customers (those who have purchased the brand at least once within a designated period.)

• Consumers (buy for their own personal or household use) vs. Business Buyers (buy on behalf of their organization)

Sociocultural FactorsSociocultural Factors

Social ClassSocial Class

All Consumers Are Human

AffectedBy:

AffectedBy:

Reference GroupsReference Groups

Factors that Affect Decision-Making

• Socio-cultural factors– Culture: group values based on traditions

and distinctive history– Society: a group of people who live

together and organize their lives as a community

– Social class: a ranking of people in a society by factors such as family history, occupation, education and income.

Factors that Affect Decision-Making (Social class)

Upper, upper

(1% of pop)

The highest class, “old rich”, well-known families

Upper (2% of pop) Professionals & businesspeople who have achieved financial success

Middle Professionals, small-business owners, corporate managers with comfortable incomes

Working class Lower-middle class or blue-collar workers who earn an average pay

Upper lower The “working poor”, who perform unskilled labor and menial work for minimal wages

Lower Poor, unemployed

Reference groups

• Associations and organizations with which people identify or to which they belong and which influence their attitudes and behaviors.

Reference Group Categories

Personal Family, friends, co-workers

Membership Clubs, churches, schools

Experts Opinion leaders, consultant, leading professionals

Aspirational Famous Entertainers, athletes, politicians

Disassociative Counterculture, gangs, antisocial people

Factors that Affect Decision-Making

• Personal Factors– Needs and wants: biological and psychological

motivations that drive actions.– Attitudes, Opinions, Beliefs

• Attitude: general disposition or orientation toward objects, people and ideas usually accompanied by negative or positive judgments

• Opinion: a specific judgment that is emotionally neutral• Belief: a thought or idea based on knowledge

Maslow’s Hierarchy of Needs

Needs Marketing & IMC Implications

Self-actualization: self-fulfillment, creative expression

Promote the enriching experience of travel, education, hobbies

Esteem: prestige, status, accomplishment, respect, recognition

Status appeal of cars, furniture, upscale electronics, country clubs, liquor, first class

Belongingness: love, friendship, acceptance

Lifestyle products, clothing, grooming aids, restaurants, and clubs

Safety: security, shelter, protection, order, discipline

Insurance, alarm systems, cavity protection, retirement, investments

Physiological: water, sleep, food, shelter

Survival necessities, utilities, medicines, basic food products

How Brand Decision Makers Respond to MC Messages

1. Hierarchy of Effects models: descriptions of a series of stages of response that brand decision makers move through

AIDA sequence (Attention, Interest, Desire, Action)

How Brand Decision Makers Respond to MC Messages…Cont’d

2. Think/Feel/Do Models Levels of involvement

• Low-involvement products-products that are relatively cheap and bought frequently without much consideration and are perceived as low risk.

• High-involvement products-products for which people perceive differences among brands and are willing to invest pre-purchase decision-making energy.

How Brand Decision Makers Respond to MC Messages…Cont’d

2. Think/Feel/Do Models Relevance- the extent to which a product

or its message is pertinent and connects with a customer’s personal interests

Risks• Financial• Performance• Physical• Psychological• Social

Think/Feel/Do Response Wheel

BRANDDECISIONPROCESS

THINK FEEL

DO

THINK:• Problem recognition• info search• evaluation

FEEL:• Attitudes

• Liking• Preferences

• Conviction• Satisfaction

DO:• Try• Buy• Other action response• Repurchase

Elaboration Likelihood Model

• Persuasion model based on involvement

• Elaboration: degree to which a customer thinks about a message and relate the information to their own lives as they make purchase decisions.

Elaboration Likelihood Model

Peripheral route process is based on such message factors as imagery, emotions, associations, celebrity spokespeople & music which creates interest in a message even if there is little interest in the product itself.

How Brand Decision Making Works

ProblemsAnd

Opportunities

Post-PurchaseEvaluation

andlearning

Cognitive Path(central processing)

Emotional Path(peripheral processing)

Habit/Repeat Path

Search for Information

Evaluate Choices

Evaluate feelings and experiences

Habit and loyalty

Purchase or take

some other action

Step 1 Step 2 Evaluation of Brand Alternatives Step 3 Step 4

How Brand Decision Making Works... Cont’d

Step 1: Recognizing a Problem or an Opportunity

Step 2: Evaluating Brand Alternatives– Awareness-getting a message past the

senses-the point of initial exposure-and into consciousness,

– Brand knowledge-understanding of a brand and its benefits.

How Brand Decision Making Works... Cont’d

Step 2: Evaluating Brand Alternatives– Two levels of brand awareness

• Recognition: identifying something and remembering that you saw or heard it earlier

• Recall: higher level of awareness, bringing something back from memory

– Evoked sets: a group of brands that comes to mind when a person thinks of a product category because the person has judged these brands to be acceptable. (Ex: Snacks: Indirect competition (nuts, cookies, chips, fruit, popcorn, candy), direct (nuts: almond, cashews, walnuts, peanuts)

How Brand Decision Making Works... Cont’d

Step 3: Deciding what action to take

Three paths to a brand decision

Type of decision making

Route Products

Cognitive processing

Think / feel / do Car, major appliances, high-involvement and new products

Experiential processing; impulse, experiences

Do / feel / think

and

Feel / do / think

Snacks, beverages, cigarettes, small household items /

Restaurants, sporting events, trade shows, new products where sampling & demo are impt.

Habit/repeat processing

Do / think /feel B2B supplies, routine purchases, repeat purchases leading to brand loyalty

How Brand Decision Making Works... Cont’d

Step 4: Evaluating the Purchase decision or other action– Learning-a change in what a person knows that

comes from exposure to new information or experiences.

– Cognitive learning theory-a view of learning as a mental process involving thinking, reasoning, and understanding.

– Conditioned learning theory-a view of learning as a trial-and-error process.

How MC Messages Influence Consumer Decisions

• Persuasion-the act of creating changes in attitudes and behaviors.– Attitude formation & attitude change

• Direction: whether the feeling is positive or negative• Degree of conviction: how sure customers are about

their attitudes, how strong their feelings are

– Brand likability– Credibility and trust– Believable arguments and reasons