Buyer Behavior

MKTG 407

What is Consumer Behavior? (Ch1-Ch2)Affect & Cognition (Ch3)

What is Marketing?• American Marketing Association Definition:American Marketing Association Definition:

• Marketing is an organizational function and a set of Marketing is an organizational function and a set of processes for creating, communicating, and delivering processes for creating, communicating, and delivering value to customers and for managing customer value to customers and for managing customer relationships in ways that benefit the organization and its relationships in ways that benefit the organization and its stakeholders.stakeholders.

• In sum,In sum,• Marketing is about Marketing is about delivering value delivering value to to all people all people affected affected

by a transaction.by a transaction.• Marketing is about Marketing is about meeting needsmeeting needs..

What is Consumer Behavior?

• American Marketing Association (and Book) Definition:American Marketing Association (and Book) Definition:• The dynamic interaction of affect and cognition, behavior, and the The dynamic interaction of affect and cognition, behavior, and the

environment by which human beings conduct the exchange aspects of environment by which human beings conduct the exchange aspects of their lives.” (p. 5 in text).their lives.” (p. 5 in text).

• DynamicDynamic• Always changing with faster product cycles and greater need for Always changing with faster product cycles and greater need for

continued innovationcontinued innovation

• Involves InteractionsInvolves Interactions• Among cognition, affect, behavior and the environmentAmong cognition, affect, behavior and the environment

• Involves ExchangesInvolves Exchanges• Exchanging value for valueExchanging value for value

What is Consumer Behavior?

• Another Nice Definition (Hoyer & MacInnis):Another Nice Definition (Hoyer & MacInnis):• The totality of consumers’ decisions with respect to the The totality of consumers’ decisions with respect to the

acquisition, consumption, and disposal of goods, services, acquisition, consumption, and disposal of goods, services, activities, experiences, people, and ideas by (human) activities, experiences, people, and ideas by (human) decision-making units (over time). (cf. Jacoby, 1976)decision-making units (over time). (cf. Jacoby, 1976)

What is Consumer Behavior?

ConsumerBehavior

Consumer Activities•Purchase•Use/Consumption•Disposal

Consumer Responses•Emotional•Cognitive•Behavioral

Kardes et al. (2008)

Consumer Influences

Culture, Ethnicity, Personality,Family, Life Stage, Values, Attitudes,Motivations, Feelings, Knowledge

Organizational Influences

Brand, Advertising, Promotions, Price,Product Features, Packaging, Service, Loyalty Programs, Store Atmosphere

Obtaining

What to buy?Where to buy?How to pay?Purchase other products?

Consuming

How do you use product?How much do you use?Does product match expectations?

Disposing

How do you get rid of product?How much do dispose?Do you recycle?

Blackwell et al. (2006)

Approaches to Studying CB (1.1)

Why Study Consumer Behavior?

• Improve Business PerformanceImprove Business Performance

• Become a Better ConsumerBecome a Better Consumer

• Help Other Consumers to Make Better ChoicesHelp Other Consumers to Make Better Choices

The Wheel of Consumer Analysis

ReciprocalDeterminism

Affective or Cognitive?

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The Affective System

• Five Characteristics:

• Largely reactive

• Little direct control over affective responses

• Felt physically in the body

• Responds to virtually any type of stimulus

• Most affective responses are learned

Types of Affective Responses

Feelings

Functions of the Cognitive System

• Interpret Information

• Attention and Comprehension

• Integrate Information

• Evaluate and Make Decisions

• Draw on Knowledge Stored in Memory

• Once activated, influences interpretation and

integration

Environment

Interpretation(Attention & Comprehension)

New Knowledge

Integrate Information(To Form Attitudes, Intentions,and Choices Among Options)

Memory(Stored

Knowledge)

Consumer Behavior

CO

GN

ITIV

EPR

OC

ESSES

Types of Knowledge

• General Knowledge (schemas)

• Stored as Propositions Linking Two Concepts

• Procedural Knowledge (scripts)

• Stored as Propositions Linking a Concept/Event with Behavior

Avatar is Great

EatingChoc.

always OrderCoffee

An Associative Network or Schema

Accessibility of Knowledge Structures

• Priming

• Temporary activation of an “associative network”

which influences interpretation, encoding, decision-

making, behavior

• Chronic Accessibility

• Constructs which are almost always highly accessible

(e.g., based on individual differences)

Using Metaphors to CommunicateAffective and Cognitive Meaning

• Metaphors:

• Represent one thing in terms of something else

• Can communicate thoughts and feelings about a

product, brand or company

• Are critical part of effective marketing strategies

Ernest Dichter (1907-1991)“Father of Motivational Research”Applied Freud’s Psychoanalytic Approach to Consumer Motivations

Nothing says lovin’ like something from the oven

Put a tiger in your tank

• Differing Views

• Affective and cognitive systems are independent

• Affect is largely influenced by the cognitive system

• Affect is the dominant system

• Affective and cognitive systems are highly interdependent

Relationship BetweenAffective/Cognitive Systems (cont.)

Relationship BetweenAffective/Cognitive Systems

Focus on Research

An Illustration of How ConceptsStored in Memory Affect Interpretation

and Decision-Making(e.g., priming)

Jiang et al. (2009, JCP, Study 4)• Background (a Person x Situation Interaction):

• # 8 is lucky in Chinese culture• May depend on whether a person is “promotion” or “prevention” focused

• Promotion focused individuals focus on obtaining gains• Prevention focused individuals focus on avoiding loses

Lucky (8) vs.Unlucky (4)

Priming

RiskyConsumerBehavior

Regulatory Focus(Promotion vs. Prevention Focus)

Jiang et al. (2009, JCP, Study 4)• Background (a Person x Situation Interaction):

• # 8 is lucky in Chinese culture• May depend on whether a person is “promotion” or “prevention” focused

• Promotion focused individuals focus on obtaining gains• Prevention focused individuals focus on avoiding loses

• Method• Hong Kong University Students• Independent Variable (evaluate how much they like 20 numbers)

• Good Luck Priming Condition• 12 of 20 numbers have an ‘8’ in them

• Bad Luck Priming Condition• 12 of 20 numbers have a ‘4’ in them

• Dependent Variables• Participation in Lottery (for a chance to win expensive dinner)• Investment in on-line stock trading

Environment

Interpretation(Attention & Comprehension)

New Knowledge

Integrate Information(To Form Attitudes, Intentions,and Choices Among Options)

Memory(Stored

Knowledge)

Consumer Behavior

CO

GN

ITIV

EPR

OC

ESSES

Apply the PrecedingInformation-Processing Model

(Including “Activation”of Knowledge)

to a Recent Consumer Decision

Cognitive Processing Ability is Limited

• Implications

• Consumers may base decisions on only a few

attributes

• Consumers may base decisions on heuristics (or

rules of thumb)

• Processing may become “automatic” (and behavior

“habitual”)

Focus on Research

An Illustration of How HeuristicsAffect Consumer Behavior

Valenzuela et al. (2009, JCP)

50%29% 21%

The “Center Stage” Effect

• Effect stronger when choice will be “evaluated” (by others)

• Effect does not occur due to increased attention

• Rather, effect occurs because people believe the middle option is more popular

• Effect does not occur if told the arrangement of the options is random

Think of a Recent Example ofHow a Simple Heuristic

Affected Your Consumer Behavior

Take Home Points1.1. CB is an interaction between affect/cognition, behavior, & environment; CB is an interaction between affect/cognition, behavior, & environment;

each can affect the others (reciprocal determinism)each can affect the others (reciprocal determinism)2.2. Affect and cognition are interdependentAffect and cognition are interdependent3.3. Affect is a physical sensation which is largely learned, not under our Affect is a physical sensation which is largely learned, not under our

control, and reactivecontrol, and reactive4.4. Cognitive system helps us interpret and integrate information and draw Cognitive system helps us interpret and integrate information and draw

on existing knowledge to form preferences, intentions and decisionson existing knowledge to form preferences, intentions and decisions5.5. General knowledge (schemas) and procedural knowledge (scripts) are General knowledge (schemas) and procedural knowledge (scripts) are

stored as “propositions” and are organized in “associative networks”stored as “propositions” and are organized in “associative networks”6.6. Much of marketing (CB) is about building up propositions (associations) Much of marketing (CB) is about building up propositions (associations)

and making them highly accessibleand making them highly accessible7.7. Accessibility can vary as a function of priming or chronic accessibilityAccessibility can vary as a function of priming or chronic accessibility8.8. Because consumer has limited cognitive capacity, much cognitive Because consumer has limited cognitive capacity, much cognitive

processing is relatively simple and can be based on “heuristics”, and processing is relatively simple and can be based on “heuristics”, and much processing/decision-making can become “automatic” or habitualmuch processing/decision-making can become “automatic” or habitual