Consumer Psychology

• The study of the interactions between consumers and organizations.

• Advertisers and advertisements are everywhere!– We are exposed to up to 3000 advertising

messages a day– Examples include signs, billboards, flyers,

scented advertisements, TV, film previews

Unique Research Methods

• Surveys and Public Opinion Polls – often excellent at predicting public behavior. But have failed famously at times. – Sample selection is often the key– Participants often fudge answers (under-report

alcohol and junk food)

• Some companies have moved toward target samples (e.g., Toyota used VW Beetle owners)

Focus Groups

• Paid participation of 8-12 members

• Match the profile of traditional product owner

• Describe their reactions to a product

• Sometimes observed using the product

• More qualitative than quantitative

Projective Techniques

• Idea that people won’t directly express their opinions. Thus need to uncover their unconscious feelings

• Use role playing, personifications, have them describe someone who uses the product

Observational Techniques

• Idea that behaviors do not always correspond with attitudes

• Variety of techniques– Purchasing Behavior: sales after an ad is aired.

Problem is that there are often other variables to consider

– Supermarket Observers: costly and time consuming, lack of experimental control (e.g., SES, ethnicity)

Observational Techniques Cont.

• Scanner Cable Panels – shopping behavior is monitored electronically (UPC Codes). Shoppers are then targeted for specific advertising via cable television

• Brand Identification and Preference Tests: Take the Pepsi Challenge!!

Testing for Advertising Effectiveness

• Aided Recall Technique – most popular method. How much of the ad content can be remembered. Aided by specific interview questions

• Recognition – where did they see it, what do they recall

• Sales Tests – control and test areas• Coupon Returns – tracks actual buying behavior.

Price reduction from coupon leads to more sales than an equivalent price markdown

Television Programming Research

• What shows are watched by a lot of people. Advertising money is at stake

• Poor pre-release research – over 90% of new programs are cancelled in their first year

• New pilots are judged by audience reaction– Viewer samples, unfortunately, are rarely random

Nielsen Ratings

• Most commonly used rating system• Use mechanical devices to assess audience

size and composition• Audimeter tracks what program is on, but not

who is watching or if it is being watched• People Meter used during Sweeps period.

Asks for the above info., but only ½ the respondents actually use it

The Seller

• Types of Advertising Used– Direct sell: Designed to elicit an immediate

buying response– Consumer Awareness: create a brand name and

maintain awareness of that name– Product Image: create an image. For similar

products, need to make yours stand out– Institutional Advertising: persuade the public

that the company is a good neighbor (e.g., Shell advertises highway safety advice)

Types of Advertising, Cont.

• Comparative Advertising - compare one brand to others. Only successful when spokesperson has a high degree of credibility

• Informational Advertising – Present facts. Increased in last decade from 20% to 65%. – Magazine ads tend to be more informative than

TV

• Primary and Secondary Needs• Celebrity Appeals – social learning theory,

we often imitate those who we identify with, resemble, or who are popular– Not very effective. Credibility of celebrity

declines with an increase in products advertised

• Positive/Negative Appeals – negative appeals fail if consequences that are shown are overly unpleasant

Types of Advertising Appeals

Types of Advertising Appeals, Continued

• Implied Superiority – No Pain Reliever Works More Quickly!!

• Suggests that it is the fastest, but actually all pain relievers work equally fast

• 70% of assertions in TV commercials utilize implied superiority

Trademarks

• Shorthand symbol of the feelings and images associated with the product

• In the 18-29 age group, the most recognized trademarks are: Coke, Campbells, McDonalds, Pepsi, Kodak, Disney, NBC

• Foreign Interpretations

• Updating Trademarks

Product Image

• The ideas, thoughts, and feelings associated with the product’s personality

• Examples include –– The Marlboro Man– The Izod Alligator in the 1980’s – Mr. Clean

Product Packaging

• Plays an important role in the products that we buy

• Packaging costs comprise 1/3 the cost of supermarket items

• Environmental concerns surrounding packaging

Sex in Advertising

• Not very effective– Target sex stares at pictures, ignores rest of ad– Overall, poor recall for ads with sexual content

• Sexist portrayal of women in advertisements

Internet Advertising

• The power of the world wide web

• Number of people on the web grows everyday– Recently, women have begun to use the web

more than men

• Targeted advertising– Cookies count the number of times a site is

accessed. Counts what site you came from

The Consumer• Buying habits and brand loyalty – habit is

the key word– Move cans of soup from normal shelf, people

unwittingly buy wrong soup– Underscores importance of getting people into

your store and trying your product– Logic behind introductory offers

• Product pricing– Price frequently not considered for staples– We use price as a meter for quality

Advertising to Different Groups

• Ethnic Groups– Considering equal economic groups, blacks

spend more on clothing, but less than whites on food, housing, and medicine

– Black spokespeople are more effective in ads aimed at blacks

– For whites it depends upon the listener’s initial state of prejudice. Low prejudice whites find black spokespeople more memorable

Advertising to Different Groups

• Children– Huge amounts of disposable income: 4-12 year

olds control $14 billion, Teenagers spend more than $30 billion a year.

– Half of routine shopping is done by adolescents– Is it ethical for psychologists to help target

advertising at children?

Advertising to Different Groups

• Gays – tend to be better educated than the rest of the population. Thus they are wealthier.– Makes gays a large potential market with high

discretionary income

• Elderly – rapidly growing sector of the economy. Currently a sector of the population that struggles economically