Chapter 15 Consumer Behavior

how to go about the final removal of separation between consumer and producer in the supply chain.

"last-mile problem"

Home delivery, as a solution to the last-mile problem, presents many retail and service firms' problems because the use of _____-_______ delivery services like Fetch or Instacart, as well as the use of common carriers like FedEx or UPS, mean that the last-mile solution is implemented outside the firm's ________

third-party ; control

represents one form of publicity in which an ostensibly objective outsider (neither the customer nor the business) provides publicly available purchase recommendations.

third-party endorsement

Functional consumption contexts must deliver __________ value to prevent switching and create loyalty in the form of _________ ________. Experiential consumption must deliver ________ value to create strong feelings that mean high ____________

utilitarian ; customer share ; hedonic ; commitment

inertia is more associated with _________ value and commitment is more associated with _________ value

utilitarian ; hedonic

Complainers, although sometimes unpleasant to deal with, are _________ sources of feedback about potential problems in service quality, product performance, or system malfunction.

valuable

A consumer's attributions represent cognitions about _____ the performance turned out as it did, and equity perceptions are cognitive reactions related to __________ ___ ___________

why ; fairness or justice

customer is likely to believe that they were treated fairly after complaining, and these thoughts evoke a more positive outcome. This positive outcome can represent a ..

win-win situation

Switching costs can be divided into three categories:

1. Procedural 2. Financial 3. Relational

two types of third party endorsements

1. The first type makes recommendations based on cumulative consumer ratings (like trip advisor) 2. The second type involves recommendations from subject experts

male consumers aged _____ to _____are the most likely to complain

30 ; 39

One might easily see that attribution theory plays a role in dealing with negative publicity. If consumers blame the company for the event surrounding the negative publicity, then the potential repercussions appear serious. However, public action to deal with any consequences of a negative event can mollify any negative effects. T/F

True

The certainty of a lengthy stream of revenues is much less for a customer acting only on inertia. T/F

True

The consumer who reacts with disgust is unlikely to complain. Disgust evokes an avoidance response, and as a result, a disgusted consumer avoids a potential confrontation and simply goes away. T/F

True

These organizations help facilitate responses from companies but they also make the complaints public. T/F Federal Communications Commission Better Business Bureau

True

True consumer loyalty consists of both a pattern of repeated behavior as evidenced by high customer share and a strong feeling of attachment, dedication, and sense of identification with a brand. T/F

True

a claim is just ridiculous, and responding may only give it some credibility that it does not deserve. T/F

True

a consumer may think the process to get a refund was too difficult while believing the refund itself was fair. In such a case, procedural justice contributes to inequity but distributive fairness contributes to equity because the consumer believes the refund was just T/F

True

bad publicity is better than no publicity at all. T/F

True

balance theory, which is described in an earlier chapter, as consumers try to maintain their existing belief systems. If the relationship with the brand is strong, accepting negative information also diminishes the consumer's self-concept. T/F

True

three out of four consumer complaints across all industries are resolved satisfactorily. T/F

True

Is one type of value more important in preventing switching behavior? ___________ value becomes important in motivating a consumer to repeat a behavior over again. In particular, for functional types of services, such as payment apps, utilitarian value is strongly related to _________ ________ (and therefore preventing switching).

Utilitarian ; customer share

relational switching cost ex ..

a consumer who has used the same hairstylist for five years. After going away to college, finding a new hair salon near the college campus seems much more convenient. Upon entering the salon and being greeted by a nice and friendly stylist, the consumer remains very uneasy

_________ saved Tylenol's reputation.

action

Typically, a consumer who complains is seeking some type of ________ to address a perceived service failure resulting in a _________ __________

action ; value deficit

What happens after consumption also serves as a basis for __________ beliefs in preparation for the ______ engagement with the company.

adjusting ; next

If the brand image cannot be maintained, then retailers implementing delivery and pick-up services incur higher costs without any competitive ____________

advantage

After two transgressions from the same business, a consumer becomes particularly vengeful unless the company can demonstrate that their intentions were to serve the customers' best interests _____ ________

all along

One of the most important things that happens after the first transaction is ____________ ______________. Therefore, businesses should be very interested in what happens after consumption—the outcomes of consumption—and the climax of CB.

another transaction

Consumers' behavioral reactions can be understood by considering whether the emotions they experience evoke ________ or _________ reactions.

approach ; avoidance

A host of evidence suggests that it's better for companies to respond ____________ to complaints.

assertively

Customer share reflects a behavioral component of loyalty by reflecting repeated _______

behavior

Customer share is the _______, and customer commitment is the ________ component of loyalty.

behavioral ; affective

Customer share represents a _________ component that is indicative of customer __________

behavioral ; loyalty

both consumers and marketers benefit from relationships that are not just long-lasting, but also mutually ___________

beneficial

Keeping customers happy has never been more important than in the ____-_____ ______

big-data era

the extreme degree of attachment between a customer and a brand to the extent that the brand becomes part of that particular customer's self-identity

brand love

watching the canning operations made ________ the fact that nobody could possibly slip a needle into a can at the speeds the assembly line operates.

clear

One of the tricks for marketers is to be able to understand the difference between the two types of consumers—the one who is highly engaged in _________ and the one who is _________ and very willing to be efficiently served.

co-creation ; unengaged

utilitarian value mechanisms tend to be more homogenized, and as a result, differences in hedonic value do more to drive customer ______________

commitment

Hedonic value, however, plays a larger role in creating ________. The receipt of hedonic value pays off as _______ goes by, because consumers' memories of hedonic value remain relatively strong.

commitment ; time

A firm that concentrates on repeated behavior alone, perhaps by always being convenient, can do well, but remains more vulnerable to ..

competitors

As you probably know from your own behavior, not all dissatisfied customers _________. In fact, far less than ______ of customers experiencing some dissatisfaction complain to management.

complain ; half

Realize that one does not have to be a _________ to spread negative WOM. Some estimates suggest that consumers who fail to achieve a valuable consumption experience are likely to tell their story to an average of 16 others, not including posts on social media

complainer

reviews can function like ___________ in pointing out potential service problems

complaints

Loyalty programs reward good customers with perks. From a behavioral learning perspective, these can be regarded as rewards that __________ behavior so that consumers repeat ______ behavior (like buying drinks at Starbucks).

condition ; good

Switching costs are one reason why a consumer may be dissatisfied with a service provider but will ________ to do business with them.

continue

refers to an exchange between consumers and businesses that the consumer views as unusually negative

critical incident

__________ influences complaining. Consumers from __________ cultures are ______ likely to complain than those from _________ cultures,

culture ; collectivist ; less ; individualist

the portion of resources allocated by a consumer to one brand from among the set of competing brands.

customer share

a company may be able to release some counter-PR to media that allows consumers to make up their own minds about the potential source of any negative PR. If this is done properly, the company does not publicly _______ any allegation about the event and instead insists that actions are being taken to get to the _________ of the event.

deny ; bottom

Compared to the angry customer, a __________ or __________ consumer is not likely to complain

disgusted ; hopeless

even when consumers are __________, they may not switch. Consider the case when competitive intensity is _____, meaning there are few alternatives for the consumer and switching costs are _____

dissatisfied ; low ; high

the intangible assets, like the feel associated with a choice or place, or the feelings consumers have for carrying their Louis Vuitton luggage or casually enjoying a Coke, are very hard to ________

duplicate

nearly _______ in ten consumers participate in loyalty programs.

eight

On occasion, consumers' verbal complaints to the marketing company do not _________ the negative emotions they experience

eliminate

suggests that a consumer evaluates a consumption experience, reacts __________, and then, perhaps, practices switching behavior

emotionally

when it comes to the ____________ industry, consumers appear more likely to spread the word about shows they find ______ rather than those they do not.

entertainment ; valuable

consumer opinions will be more shaped by reviews for technologically-oriented products and relatively unfamiliar brands compared to __________ brands.

established

When competitors in functional contexts provide undifferentiated services, they too need to create distinct ________ that produce ________ value as a means of driving loyalty.

feelings ; hedonic

Value is shaped by _________ and ___________ and, in turn, drives a consumer to stay or leave, encourages or discourages further engagement, and ultimately ________ whether the relationship is maintained through both behavioral and affective loyalty

function ; experience ; determines

Indeed, engagement, particularly in terms of __________ purchasing, is why marketers are interested in _________ satisfaction. Marketers want customers to stay _________ engaged following a transaction.

future ; pursuing ; positively

Attributes that marketers build into a product to create procedural switching costs are a source of frustration for customers. For example, some consumers become so frustrated with cable TV services that they just ..

give up their TV

consumers are about ______ as likely to spread positive WOM as they are negative WOM.

half

Negative publicity can do considerable ______ to a brand.

harm

Anger motivates both ________ and _________ behaviors toward the marketer.

harmful ; helpful

However, if Bill were truly committed, he would seek out another Starbucks location, even if it is not the most convenient or the least expensive option. This distinguishes inertia from a truly loyal customer. Indeed, the Starbucks loyalty program succeeds not just for the points, but because the Starbucks customer experience often brings ________ value.

hedonic

for more experiential types of services, such as fashion shopping, _________ value is more strongly related to customer share.

hedonic

When competitive intensity is _____ and switching costs are _____, a company is vulnerable to consumers who will switch providers even when _______. The consumer has many companies vying for the _______, and changing to a competitor presents little _______

high ; low ; satisfied ; business ; barrier

WOM is powerful because of relatively ...

high source credibility

Negative WOM can also damage the _______ of the firm.

image

Loyalty programs can be critically _________ in feeding data to ____ systems.

important ; AI

Many firms that truly adopt a relationship marketing approach with customers enjoy ____________ performance. This is particularly the case as the relationship between customer and seller becomes very personal and involves ________

improved ; trust

In extreme cases, the negative WOM attached to one company can have effects that spill over to an entire

industry

Benefits such as convenience and low-price help create and feed customer ______. Feelings of emotional attachment that a high degree of personalization in terms of offers and unique experiences bring, feed customer ____________

inertia ; commitment

Once consumers adopt the more convenient option, they build up ______ that may take a large perceived gain in value to ________

inertia ; overcome

firms take legal action to try to stop organized efforts at fake reviews because they know that reviews __________ sales.

influence

in-store pickup or curbside, click & collect systems offer retailers and service firms more control over the _______ ______. The benefit of convenience builds customer _____ as they may work the pickups into their weekly routine.

last mile ; inertia

Not only do perceptions of unfair prices may make consumers temporarily angry, but they also create _____________ ___________

lasting memories

Companies like Amazon try to add some credibility to reviews by indicating whether the person leaving the review is a ___________ customer.

legitimate

Even if an Apple MacBook is easy to use, a consumer familiar with a PC-based Windows operating platform would have to forgo this knowledge to learn how to use a MacBook. Thus, the effort that went into learning the PC system is _____ and replaced by effort that would be needed to learn how to use an Apple. When consumers master a technologically complex product, they become very ________ to switching.

lost ; resistant

price-sensitive consumers become less ______ following the __________ than do those with less price sensitivity.

loyal ; complaint

he inability of web-based retailers to create anything other than procedural loyalty may be responsible for low levels of ________ observed for many pure-play (Internet-only) retailers

loyalty

If the consumer has been a regular Waffle House customer, switching to Panera Bread now involves learning a new assortment of menu items, taking a risk of losing any accumulated Waffle House _______ _______, and missing out on all of those free Waffle House coffee _______

loyalty benefits ; refills

a device that encourages repeated purchasing and keeps track of the amount of engagement a customer has had with a given marketer (as well as a list of actual items purchased by the consumer); more spending generally brings more rewards in one form or another.

loyalty program

For hoteliers, loyalty programs create a sense of both long-term financial gain and higher relational switching costs for customers, but those same loyalty programs can be expensive to ______ based on the perks required to build up the switching costs. Thus, loyalty programs have to be executed with care.

maintain

brands with low customer satisfaction can have high ________ ______.

market share

low satisfaction/high market share situation is typical among _______ _________

mass marketers

Complaining is a relatively _____ way of coping with anger.

mild

Results are ______ with respect to loyalty programs' effectiveness. In fact, they can sometimes backfire by appealing too _______ to consumers who are ________ shoppers.

mixed ; strongly ; bargain

Marketing firms today need to invest resources toward _________ online reviews and social media posts and to respond accordingly in a way that is not argumentative, but invites further communication with a legitimate complainant.

monitoring

hese antiloyal consumers, who are former customers, become perhaps the most frequent source for ________ word-of-mouth.

negative

While _________ engagement like complaining perhaps receives more __________ as reactions to consumption, positive outcomes, including positive word-of-mouth behavior, and ultimately, the development of a strong relationship, are ___________ elements to success.

negative ; attention ; essential

Formerly loyal consumers sometimes become the biggest sources of

negative WOM

More and more consumers are turning to social media as a way of spreading ..

negative publicity

an action that occurs when negative wom spreads on a relatively large scale, possibly even involving media coverage

negative publicity

Consumers who spread negative WOM without complaining to the company itself are particularly likely to _______ do business with that company again

never

Marketing managers have come to accept the fact that getting business from a customer who has already done business with the company before is easier than getting a _____ __________

new customer

consumers do not maintain relationships in which they find ____ value. Even if consumers do not enjoy shopping at Walmart, they tend to repeat the behavior because of high __________ value

no ; utilitarian

When it comes to rancorous or retaliatory revenge, the customer is definitely ____ _________ right.

not always

Marketers must continually adjust their ________ _________ for various media devices or risk aggravating potential customers. A wait of even a few seconds for a page to load can be a source of complaints. Thus, investments in technology make sense—to the extent that such things as Internet speed can be _________

online content ; controlled

when relationship quality is very strong, the marketer and the customer act as ________

partners

The fact of the matter is that for consumers as well as marketers, complaining ______ _____

pays off

when marketers can take action to address a negative situation before a consumer complains, a very __________ outcome can result.

positive

consumers who have bad experiences with companies become agents of ________ WOM if they believe the transgression was handled with high procedural _________

positive ; justice

occurs when consumers spread information from one to another about positive consumption experiences with companies.

positive WOM

value plays a role in the _____-consumption process. During an exchange, the consumer goes through the consumption process, and the result produces some ________ and type of value. The value, in turn, shapes what happens _____

post ; amount ; next

switching costs are another important reason why CS/D results often fail to _______ future purchasing behavior.

predict

consumers high in _________ ___________ are more likely to _________ than consumers with some indifference about the price paid for a service.

price sensitivity ; complain

Complaints are a _______ _______ of information that can be used to make ____________ to goods and services.

prime source ; improvements

Although perks can be very expensive for companies to provide, they make sense because the so-called good customers are disproportionately __________ for the companies.

profitable

not all high satisfaction conditions are highly _________. By limiting ________ on satisfaction, a firm can sometimes find profitability.

profitable ; spending

One study of this type of behavior suggested that it more than pays for itself in terms of customer retention if the store provides the compensation _______

quickly

Gatorade automates some responses to social media as a way of protecting the brand from negative publicity. In the social media world, the key is to respond ________ before negative news goes ______

quickly ; viral

One of the drawbacks of disconfirmation theory, , is that it does not account for value _________

received

When a consumer complains, the marketer has a chance to ________ the negative situation.

rectify

even though all types of functional costs can prevent switching, evidence suggests that ___________ barriers may be the most resistant to influence. Retailers who build up procedural switching costs, particularly through the use of loyalty cards and other similar programs, may gain temporary repeat purchase behavior, but they fail to establish the connection with the customer that wins them ______ loyalty.

relational ; true

refers to the emotional and psychological consequences of changing from one brand/retailer/service provider to another.

relational switching costs

Marketers have come to realize that the exchange between a business and a consumer constitutes a __________

relationship

The tenet of _________ marketing is that a company's marketing is much more efficient when most of the business comes from _______ customers. In this sense, Bill is a more valuable consumer to Starbucks than Erin is. Starbucks gets a greater ______ of Bill's coffee business than they do Erin's.

relationship ; repeat ; share

Taken together, CS/D, complaining behavior, switching, customer share, and commitment all indicate ..

relationship quality

represents the degree of connectedness between a consumer and a retailer.

relationship quality

Doing nothing is neither the best nor the worst option. Taking action seems to be a ____________ thing to do, but the action might backfire and bring more _________ to the issue

responsible ; attention

Highly committed customers will make ________ to continue a relationship with a brand. In addition, those truly loyal customers remain engaged with a brand by spreading _______ WOM

sacrifices ; positive

Negative WOM does not affect all consumers and all brands in the ______ ______. Consumers who have very strong, positive feelings about a brand may have a difficult time _________ negative WOM.

same way ; accepting

The most basic marketing function is removing separation between buyer and ..

seller

Sometimes, an issue may be so politically _________ that any response has the chance of being ____________

sensitive ; misinterpreted

Consumers with a strong economic orientation display a lower customer _____ among competitors, and instead choose to shop in the place with the current best _______

share ; offer

Some managers use the term ________ ___ ________ to refer to customer share

share of wallet

The story of CB does not end with the transaction. In fact, a transaction can be a _________ place. To help bring customers back, many companies offer _____________ ______________: 100 percent Satisfaction or Your Money Back!

starting ; satisfaction guarantees

customer engagement in co-creation of both utilitarian and hedonic value creates a ________ that encourages them to tell others about their experience and exhibit loyalty-related behaviors.

stickiness

Financial Times: ranks business schools and graduate business programs U.S. News and World Report: ranks universities, educational programs, and hospitals Consumer Reports: rates the latest consumer products from soap to automobiles Wine Spectator and Wine Advocate: rates wines based on blind taste tests by editors on a scale of 50 to 100 J.D. Power: rates automobiles and many other industries CNET: rates many consumer products, with an emphasis on electronics (reviews.cnet.com) what are these examples of?

subject experts of third party endorsements

After initial denials of such incidents, evidence emerged to the contrary of the denials. Facebook's brand image continues to ______

suffer

Equity judgments, in particular perceptions of unfair treatment, are particularly prone to lead consumers to

switch

dissatisfaction does not always mean that the consumer is going to ________. Before reaching a conclusion on vulnerability to losing a customer, one also has to consider at least ____ other _______. For instance, the ______ of competition and the competitive _________ also play a role in determining who switches

switch ; two ; factors ; amount ; intensity

a consumer behavior context, refers to the times when a consumer chooses a competing choice, rather than the previously purchased choice, on the next purchase occasion.

switching

utilitarian and hedonic value can be key to preventing consumers from __________ to a competitor and creating true _________ among consumers

switching ; loyalty

If a consumer visited Waffle House for breakfast last week, and chooses Panera Bread for the next breakfast outing, the consumer has practiced ..

switching behavior

the costs associated with changing from one choice (brand/retailer/service provider) to another

switching costs

development and enforcement of legal barriers has not caught up with

technology

Marketers have to assume that for every customer who complains about a problem, there are _______ ______ who experienced one but didn't _________

ten more ; complain

word of mouse

the electronic version of WOM

Another study shows that shoppers who experience a reversal in orientation, in a pattern consistent with reversal theory, when something in the environment triggers a shift from a browsing to a buying orientation. A reversal of that type transforms the customer experience into higher value and the shoppers reciprocate with a highly likely to describe the experience to others. T/F

True

Antiloyalty is often motivated by a bad experience between a consumer and the marketer that the marketer could not redress. T/F

True

Consumers who complain experience different emotions than do those who do not complain. In contrast to consumers who are merely dissatisfied, angry consumers are very likely to complain and, at times, the anger becomes very strong and reaches the stage of rage T/F

True

consumers will tend to continue a pattern of behavior until some stronger force motivates them to change.

Consumer inertia

Customers who believe a firm has adequately responded to some negative critical incident are likely to become more loyal, and loyalty is the positive outcome relationship-oriented firms seek. T/F

True

Lower-tier loyalty customers don't need to know all the secrets of top-tier loyalty. T/F

True

those who will do everything possible to avoid doing business with a particular marketer.

Antiloyal consumers

___________ recognizes that the value received from consumption depends not only on the products or service providers, but also on the customers themselves! for example, a vacation experience to the Top of the Rock in Missouri or the Palms Hotel and Spa at Miami Beach, the customer plays a role in creating the experience and may end up taking credit for that good outcome. At the very least, the customer has done enough research to find the place.

Co-creation

refers to the number of firms competing for business within a specific category

Competitive intensity

___________ ___________ occurs when a consumer actively seeks out someone to share an opinion with regarding a negative consumption event. The person may be a service provider, a supervisor, someone designated by a company to take complaints, or an institution like the Better Business Bureau (BBB) or Federal Trade Commission (FTC).

Complaining behavior

captures this sense of attachment, dedication, and identification.

Customer commitment

___________ ___________ ___________ consist of the total economic resources that must be spent or invested as a consumer learns how to obtain value from a new product choice. Consumers in some parts of the world do not have such a subsidized system so a new smartphone can cost the equivalent of over $1,000 to _________

Financial switching costs ; acquire

Loyalty cards also allow marketers to learn more about customers' personal characteristics and behavior through the data they collect. T/F

True

takes place when consumers pass on negative information about a company from one to another

Negative word-of-mouth (negative WOM)

_____-____________ cognitions lead to an affective reaction most conventionally represented by consumer ____________ or ____________ (CS/D). This particular model recognizes that the evaluation process could lead to any number of varying affective outcomes,

Post-consumption ; satisfaction ; dissatisfaction

refers to the extent that consumers believe the processes involved in processing a transaction, performing a service, or handling a complaint are fair

Procedural justice

the lost time and extended effort spent in learning ways of using some product offering

Procedural switching costs

when a consumer yells insults and makes a public scene in an effort to harm the business

Rancorous revenge

an action taken by a consumer who becomes violent with employees and/or tries to vandalize a business in response to an unsatisfactory experience

Retaliatory revenge