mkt3050 – consumer behavior week 6 april 23, 2012

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MKT3050 – Consumer Behavior SeminarWeek 6 – April 23, 2012


Making Decisions

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Internal factorsHow you learn

Your perceptionYour memory

How you organize informationAttitudes

Your motivationPersonal values

PersonalityLifestyle

Emotional expressiveness

External factorsYour culture and cultural valuesYour reference groupsPeer influenceSocial classFamily influence

Situation - atmosphere - timing - conditions


Objectives

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• This week, we’ll examine reference groups and how they are different than micro-cultures.– How are reference groups influence us? How do they deliver

value to us?• We’ll also review families and households.

– How are families changing? Households?– What effects have these changes had on consumers?

• And then we’ll begin discussion the consumer decision process.– How do consumers identify needs?– How do they search for information?


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Consumer Value Framework (CVF)


What are Reference Groups?How are they different from Micro cultures?

A group of individuals who has significant relevance for a consumer and who impacts the consumer’s evaluations, aspirations, and behavior.

Reference Groups

So how is this different from micro culture??


How do Reference Groups influence us?

• Group influence refers to the ways in which group members influence the attitudes, opinions, and behaviors of others within the group.

• Group members:– Share common goals

and interests– Communicate with, and

influence, one another– Share a set of

expectations, rules, and roles

– View themselves as members of a common social unit

©CHARLEY GALLAY/GETTY IMAGES http://www.youtube.com/watch?v=yTo7I3rCLIo


Types of Groups

• Primary – frequent interaction (family)• Secondary – less frequent (social

groups)

Primary & Secondary

brand community

Formal & Informal

Aspirational & Dissociative

• Formal – set of stated rules, codes of conduct (church)

• Informal – no membership requirements, no rules (golf club)

• Aspirational – you desire to become a member for your ideal self.

• Dissociative – you don’t want to belong. The ‘what not to be’ group influence

• What are your reference groups?


Dynamics of Reference Groups

ConformityA result of group influence in which an individual yields to the attitudes and behavior of others.

Peer PressureThe extent to which group members feel

pressure to behave in accordance with group expectations.

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Any peer pressure atNorthwood?


Dynamics of Reference GroupsTypes of Social Power


How can Reference Groups influence the behavior of others?

• Informational influence – consumers use the behaviors and attitudes of reference groups as information into making their own decisions.– Can occur through observation

• Utilitarian influence – consumers conform to group expectations to receive a reward or avoid punishment.– Reward = acceptance

• Value-expressive influence – consumers internalize a group’s values or join groups to express their own values and beliefs.


How can Reference Groups influence the product selection of others?

Influence varies depending on…• Public vs private consumption

– When seen by others, reference groups may be more important

• Luxury vs necessity item– Necessities aren’t as influenced by reference

groups

• Brand vs type of product is more important– If brand is in play, reference groups will influence

public items


How do Reference Groups Influence Consumer Purchases?

• Reference group influences stronger for purchases that are:– Luxuries rather than necessities– Socially conspicuous/visible to others

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Individual Difference in Susceptibility to Group Influence

Susceptibility to interpersonal

influences

Attention to social

comparison information

Separateness - connectedness Embarrassment

Which level of Maslow’s hierarchy affects how muchgroups affect you as an individual? What role does culture play?


What are Families and Households?

• Family defined as:– 2+ people related by blood, marriage, adoption who reside together

• Types of families:– Nuclear – immediate family– Extended – includes grandparents, in-laws– Orientation – born into– Procreation – married into

• Household Defined as:– All persons, related and unrelated who live in same housing unit

• Household importance is growing…– Rapid growth in nontraditional families and non-families

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Why is Understanding the Family and Household Structure Important?

• Many products purchased by a family unit• Individual buying decisions influenced by family members

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Young Divorced

no Children

Middle Aged Married no Children

Middle Aged Divorced no

Children

Young Divorced or Single with

Children

Middle Age Divorced or Single with

Children

Middle Age Divorced or

Single Empty Nesters


Determining Family Purchases

• Roles of family members affect purchase.– Instrumental roles – involve the economics of the

purchase– Expressive roles – involve the family’s emotional

needs, including upholding norms• Family members can play one or more roles in the

decision process:– Gatekeeper– Influencer– User– Decision Maker– Purchaser

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Marketers need to identifyand reach consumersin each of these roles.

Family roles differ by microCulture.


What has happened to Households as a result of changing family structures?

• The average household size has fallen in most industrialized countries

• Nonfamily households are projected to grow more rapidly than families over the next few decades, but the highest incomes are found among family households.

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Because many consumers are less connected to family influences, they look for surrogates to

help with decision making

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Social Media

Social Networks

Social Networking Websites

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Among Those Who Use Social Media, Facebook is Most Popular

Proportion of People Using Various Social Media Sites, Past Month

Flickr Digg CoziWindows Live Profile Foursquare TypePad

StumbleUpon Reddit Commission JunctionClassmates Online MeetUp Badoo

Wordpress LinkShare BlogHerBlogger Squidoo RenrenTumblr OrkutVimeo

Pinterest

Sites used by less than 10% of respondents

N14. Which, if any, of these specific sites, services, or tools have you used during the past 30 days? (1641)


Guidelines for Reaching Consumers with Social Media

•Social media is a tool you can use to get outside your box and create a more personal and personable relationship with your consumers•If you choose to use social media remember to:•Listen loudly: Employ people to monitor a range of social media platforms and listen to consumers’ conversations about you. •Respond quickly: Try not to let conversations and comments about your brand go unanswered. Respond to your consumers.•Celebrate successes: Gather consumers’ positive feedback and broadcast their words on social media. Let consumers talk for you.•Reinvent yourself: Gather consumers’ feedback and use it to make a better product or improve your services.


Other Family Surrogates / Group Influences Word-of-Mouth and Opinion Leaders

• Word-of-Mouth– Information about products, services, experiences that is

transmitted from consumer to consumer• Other consumers more believable than advertising and

marketing!

• Opinion Leaders– Consumers who have great influence on the behavior of others

• Knowledgeable about products• High level of involvement with products• Socially active and confident

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Surrogate Consumers / Market Mavens

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Lisa Belkin | MotherlodeLisa's Rankings

#1 Best Written #2 Most Controversial #3 Most Useful #13 2009 Top 50

If you want to know where modern moms are getting their voice, look no further than Lisa Belkin and her wildly successful New York Times blog. Controversial, funny, and always inspiring worthwhile conversation, Motherlode takes the top spot as the must-read mom blog of 2010. Lisa Belkin is the go-to source for the hottest parenting news, whether it’s a national saga unfolding before our eyes or a quietly interesting story that we’d never have found ourselves. http://www.youtube.com/watch?v=tUE84Y22eUg


Other influences on consumers

• Buzz Marketing– Through word-of-mouth– Viral (on-line)

• http://www.youtube.com/watch?v=iefi-7qXpzk&feature=related

• Stealth Marketing– Product placements

• http://www.youtube.com/watch?v=wACBAu9coUU– Having employees pose as consumers– Ethics??

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So how do Consumers make decisions?Consumption Process and Decision-Making

• CHOICE occurs throughout the process.– These choices are always

linked to finding value!• Doesn’t necessarily lead to

a product –– May be a service– Participation– Attendance

• Decision making is also linked to motivation and emotion


What types of perspectives do consumers have when making decisions?

Consumers don’tfollow the sameprocess with eachdecision.

Which perspectivesare more aligned with Utilitarian purchases?Hedonic?


What types of approaches do consumers use when making decisions?

• The decision making approach depends on the level of involvement and the level of risk associated with the decision.

• Which decision approach is longest? • When a consumer is brand-loyal, which approach is most likely?


Need Recognition doesn’t always lead to a decision

27A ‘want’ is the way in which consumers address a need !


What are ‘Need States’?

• Marketers try to uncover the motivations and emotions that underlie a need. The term ‘need states’ was developed in mid-2000.

• A need state is defined by a group of consumers who are alike in terms of the product benefits and attributes they seek in a particular use occasion. For the same product, a consumer can experience different need states over the course of the day or across the occasions they will use that particular product. – For instance, a yogurt user may want a product for weight control that

fits into her fitness routine for breakfast, and maybe lunch; at these occasions, she would desire a yogurt that is low in calories and fat.

– Later in the day, that same person may want an indulgence and seek a yogurt that is sweet, has a bold flavor and is worth the extra calories.

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How do Marketers attempt to measure needs?

• Focus groups with techniques like ..– laddering (an interviewing method that invites consumers to reveal

specifics), – projection (where consumers are asked to role play), – contextual interviews (observing behavior and product/category

interactions, either in person or via video diaries), offer insight into consumers’ different usage occasions with the brand and the needs that define them. • These techniques elicit consumer language that describes their need

states. Combining consumer language with our own observations allows us to understand the language we should use and the situations we should consider.– Has implications for new product development, brand personality,

and messaging.

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How do Marketers attempt to measure needs

• Quantitative tools like …– online journals and usage diaries (where consumers relay their

habits and practices)– attitude and image surveys (consumers react to functional and

emotional attributes)– market structure (relating product usage to demographics, needs

and occasions) help quantify consumer need states and provide a strategic focus for the marketing plan

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• Lays• Ruffles• Cheetos• Fritos• Doritos• Sun Chips• Baked Snacks

• Chips• Store Brand• Other Brands

• Popcorn• Pretzels• Multi-Grain• Snack Mix• Pork Rinds• Other Snacks

• Potato Chips• Cheese Puffs• Tortilla Chips• Corn Chips• Multi-Grain• Pretzels• Popcorn• Snack Mix• Veggie, Rice,

Pita, other chips

• Lays• Ruffles• Cheetos• Fritos• Doritos

• Pretzels• Tortilla Chips• Corn Chips• Pita & Bagel Chips

• Potato Chips• Baked• Light• Natural• Kettle

• Potato Chips• Cheese Puffs• Popcorn• Snack Mix• Pork Rinds• Veggie, Rice,

Potato Snk, etc…• Multi-Packs• Large Sizes• Canisters

Example Market Structure


Need and Search: Web Design

• Watch this clip on Manifest Digital’s successful use of consumer need recognition.

What does Manifest Digital mean when it says its philosophy is based on “user centered principles?”

12_ Manifest Digital.wmv

How has this philosophy contributed to the company’s success?


After Consumers identify a Need and decide to seek value, the Search begins!

Prepurchase – to help

with decision

External – family, friends, groups

Ongoing – staying up-

to-date

Internal – retrieve

stored info

Information Overload


How much to search?

• Product experience• Involvement• Perceived risk• Value of search effort

• Time availability• Attitudes towards

shopping• Personal factors• Situational influencers

mkt3050 – consumer behavior week 6 april 23, 2012

Technology