Marketing 305 Exam #1

Culture of participation

- a belief in democracy - the ability to freely interact with other people, companies, and organizations - open access to venues that allow users to share content from simple comments to reviews, ratings, photos, stories, and more - the power to build on the content of others from your own unique point of view social media enables this culture

How we divide consumers

- age - gender - family structure - social class and income - race and ethnicity - geography - lifestyles - behavior

Dark side of consumer behavior

- consumer terrorism ex: Tylenol laced with cyanide - addictive consumption ex: Facebook, TV - compulsive consumption - consumed consumers ex: prostitution, human trafficking - shrinkage ex: shoplifting and employee theft - counterfeiting - anticonsumption - serial wardrobers

Consumer surveys consistently indicate that over 60% of consumers are willing to pay more for:

- recyclable packaging - all natural products - energy saving light bulbs - free trade coffee Yet, sales for these products are flat to lower versus a year ago

A product/brand can mean all things to all people, which is why marketers ________________________________________________.

... segment and target consumer groups

Traditional Consumer Funnel

1. Awareness 2. Familiarity 3. Consideration 4. Purchase 5. Loyalty

Consumer Decision Journey (replacing traditional consumer funnel)

1. Initial consideration set 2. Active evaluation, information gathering, shopping 3. Moment of purchase 4. Post-purchase experience (ongoing exposure) 5a. Back to the initial consideration set 5b. Loyalty loop

Organizations should encourage people to complain because:

1. They get the chance to correct the situation 2. They will avoid an escalating problem from negative social media posts 3. They collect valuable insights about customers' experiences that will help them improve for future customers 4. If consumers do not believe that the store will respond to their complaint, they will be more likely to simply switch than fight as they just take their business elsewhere

3 Possible Courses of Action if unhappy with a product or service:

1. Voice response 2. Private response 3. Third-party response

Great marketing and new products spring from a ___(1)____, but ____(2)_____ understanding of people's________(3)_________, and a product's ____________(4)___________.

1. deep 2. simple 3. links to a product 4. link to people's lives

Marketing has a goal to _________(1)_________ at a point in the _____(2)_______ to _______________(3)________________

1. reach consumers 2. consumption process 3. most influence their decision

People often buy products not for ______(1)_________ , but for _____(2)_______.

1. what they do 2. what they mean - a fundamental premise of modern consumer behavior ex of meanings: - self attachment concept - nostalgic attachment - interdependence - love

80/20 rule

20% of users account for 80% of sales

Interstate Commerce Commission (ICC)

Regulates interstate bus, truck, rail, and water operations - the ability of a firm to efficiently move products to its customers depends on ICC policies and regulation

Consumption Communities

Where members share opinions and recommendations about something - the growth of the web has created thousands of these

C2C e-commerce

consumer-to-consumer activity - largely increased activity due to cyberspace explosion

Market Access

consumers ability to find and purchase goods and services - many individuals access is limited because of physical, mental, economic, or social barriers

Marketplace Sentiments

consumers' feelings about companies or market practices

Virtual Worlds

immersive 3D virtual environments such as Second Life

The Student Digital Privacy & Parental Rights Act of 2015

law that would prevent companies from selling student data to 3rd parties

The Personal Data Notification & Protection Act of 2015

legislation that would requre consumers to be notified when their personal information has been compromised

Consumerspace

marketing environment where customers act as partners with companies to decide what the marketplace will offer - replaced marketerspace

Corrective Advertising

messages an organization releases (voluntarily or not) that inform consumers of previous messages that were inaccurate or misleading

Paradigm shift

occurs when a competing paradigm challenges the dominant set of assumptions ex: the perspective that regards people as rational information processors is currently the dominant paradigm, although this approach is now being challenged by a new wave of research that emphasizes the frequently subjective nature of consumer decision making

Greenwashing

occurs when companies make false or exaggerated claims about how environmentally friendly their products are

Identity theft

occurs when someone steals your personal information and uses it without your permission ex: charge items to your credit card or access medical service vis your health benefts

Social marketing

the promotion of causes and ideas (social products) such as energy conservation, charities, and population control ex: beer commercials to discourage drunk driving

Consumer Culture Theory (CCT)

the study of consumption from a cultural perspective rather than a psychological or economic focus

Consumer Behavior

the study of the processes involved when individuals or groups select, purchase, use, or dispose of products, services, ideas, or experiences to satisfy needs or desires - field referred to as "buyer behavior" in the 60's and 70's, focusing on the interaction between consumers and producers at the time of purchase (it is now recognized as an ongoing process)

Database marketing

tracks specific consumers' buying habits closely and crafts products and messages tailored precisely to people's wants and needs based on this information

Market Segmentation Strategies

An organization targets its product, service, or idea only to specific groups of consumers rather than to everyone

Positivist vs Interpretivist: View of causality

Positivist: - existence of real causes Interpretivist: - multiple, simultaneous shaping events

Positivist vs Interpretivist: Nature of reality, Goal

Positivist: - objective, tangible, single prediction Interpretivist: - socially constructed, multiple understanding

Positivist vs Interpretivist: Research relationship

Positivist: - separation between researcher and subject Interpretivist: - interactive, cooperative with researcher being part of phenomenon under study

Positivist vs Interpretivist: Knowledge generated

Positivist: - time free, context independent Interpretivist: - time bound, context dependent

Disciplinary Focuses on the study of consumer behavior (The Pyramid of Consumer Behavior)

[ Micro Consumer Behavior (individual focus) ] - experimental psychology - clinical psychology - microeconomics/ human ecology - social psychology - sociology - macroeconomics - semiotics/ literary criticism - demography - history - cultural anthropology [ Macro Consumer Behavior (social focus) ]

Brand Loyalty

a bond between product and consumer that is difficult for competitors to break

Media literacy

a consumer's ability to access, analyze, evaluate, and communicate information in a variety of forms, including print and nonprint messages

Asynchronous interactions

a conversation in which all participants are not required to respond immediately ex: when you text a friend and get an answer the next day

Synchronous interactions

a conversation that requires participants to respond in real time ex: when you text back-and-forth with a friend

Horizontal revolution

a fundamental change in how consumers communicate via social media, whereby information doesn't just flow from big companies and governments; information flows across people as well

Food desert

a geographic area where residents are unable to obtain adequate food and other products to maintain a healthy existence - 35% of the population, or over 500 people, whichever is less, live more than a mile from a grocery store in an urban area, or more than 10 miles away in a rural area - about 73.5 million people in the U.S. live in food deserts

Green marketing

a marketing strategy involving an emphasis on protecting the natural environment - involves the development and promotion of environmentally friendly products

Megacity

a metropolitan area with a total population of more than 10 million people - In 2011, there were 20 of these in the world

Conscientious Consumerism

a new value that combines a focus on personal health with a concern for global health

Consumers

a person who identifies a need or desire, makes a purchase, and then disposes of the product during the 3 stages of the consumption process

Functionally Illiterate

a person whose reading skills are not adequate to carry out everyday tasks, such as reading the newspaper or the instructions on a pill bottle - 1 in 7 U.S. adults are this

botnets

a set of computers that are penetrated by malicious software known as malware that allows an external agent to control their actions

Curation

a source such as a store or a celebrity selects a set of products to simplify shoppers' decisions

Want

a specific manifestation of a need that personal and cultural factors determine

Marketerspace

a time when companies called the shots and decided what they wanted their customers to know and do - replaced by consumerspace

Exchange

a transaction in which two or more organizations or people give and receive something of value

Paradigm

a widely accepted view or model of phenomena being studied

Real-time bidding

an electronic trading system that sells ad space on the web pages people click on at the moment they visit them

Sustainability

an emphasis on creating and maintaining the conditions under which humans and nature can exist in productive harmony, that permit fulfulling the social, economic, and other requirements of present and future generations

Voice Response

appealing directly to the retailer for a redress (i.e. a refund)

Interpretivism (post modernism)

argues that our society emphasizes science and technology too much and that this ordered, rational view of behavior denies or ignores the complex social and cultural world in which we really live - stresses the importance of symbolic, subjective experience, and the idea that meaning is in the mind of the person - in this view, the world in which we live is a pastiche: a mixture of images and ideas - paradigm that is challenging the current dominant paradigm of positivism (modernism)

Triple Bottom-Line Orientation

business strategies that strive to maximize return in 3 ways: 1. The financial bottom line- provide profits to stakeholders 2. The social bottom line- return benefits to the communities where the organization operates 3. The environmental bottom line- minimize damage to the environment or even improve natural conditions

B2C e-commerce

businesses selling to consumers

Private Response

express your dissatisfaction to friends and boycott the product or store where you bought it

Activist consumer groups

care about a company's political stance

Green consumer groups

care about a company's sustainability efforts

Ethical consumer groups

care about how a product was made ex: the working conditions

Demographics

descriptive characteristics of a population such as gender, age, income, or occupation

Environmental Protection Agency (EPA)

develops and enforces regulations aimed at protecting the environment - such regulations have a major impact on the materials and processes that manufacturers use in their products and thus on the ability of companies to develop products

Federal Trade Commission (FTC)

enforces laws against deceptive advertising and product labeling regulations. - marketers must constantly keep abreast of changes in FTC regulations to avoid costly fines

Food and Drug Administration (FDA)

enforces laws and regulations on foods, drugs, cosmetics, and veterinary products. - marketers of pharmaceuticals, over-the-counter medicines, and a variety of other products must get FDA approval before they can introduce products to the market

Net neutrality

ensures that everyone (individual users and behemoth companies) is guaranteed equal access to the "pipes" we rely on to access cyberspace

Economics of Information

perspective that regards advertising as an important source of consumer education

Relationship marketing

philosophy that the key to success is building relationships between brands and customers that will last a lifetime - marketers interact with customers on a regular basis and give them solid reasons to maintain a bond with the company over time

Cause marketing

popular strategy that aligns a company or brand with a cause to generate business and societal benefits

Corporate Social Responsibility (CSR)

processes that encourage the organization to make a positive impact on the various stakeholders in its community including consumers, employees, and the environment

Cultural Anthropology

product role in a society's beliefs and practices ex: ways in which fashions and models in a magazine affect readers' definitions of masculine versus feminine behavior

Microeconomics/ Human Ecology

product role in allocation of individual or family resources ex: factors influencing the amount of money a household spends on magazines

Macroeconomics

product role in consumers' relations with the marketplace ex: effects of the price of fashion magazines and expense of items advertised during periods of high unemployment

Experimental Psychology

product role in perception, learning, and memory processes ex: how specific aspects of magazines, such as their design or layout, are recognized and interpreted

Clinical Psychology

product role in psychological adjustment ex: how magazines affect readers' body images (do thin models make the average woman feel overweight?)

Sociology

product role in social institutions and group relations ex: pattern by which magazine preferences spread through a social group (like a sorority)

History

product role in societal changes over time ex: ways in which our culture's depicions of "femininity" in magazines have changed over time

Social Psychology

product role in the behavior of individuals as members of social groups ex: ways that ads in a magazine affect readers' attitudes toward the products depicted

Demography

product role in the measurable characteristics of a population ex: effects of age, income, and marital status of a magazine's readers

Semiotics/ Literary Criticism

product role in the verbal and visual communication of meaning ex: ways in which underlying messages communicated by models and ads in a magazine are interpreted

Transformative Consumer Research (TCR)

promotes research projects that include the goal of helping people or bringing about social change - also called participatory action research (PAR)

Consumer Product Safety Commission (CPSC)

protects the public from potentially hazardous products - through regulation and testing programs, the CPSC helps firms make sure their products won't harm customers

Federal Communications Commission (FCC)

regulates telephone, radio, and television - FCC regulations directly affect the marketing activities of companies in the communications industries, and they have an indirect effect on all firms that use broadcast media for marketing communications

Business Ethics

rules of conduct that guide actions in the marketplace - the standards against which most people in a culture judge what is right and wrong, good or bad

phishing

scams in which people receive fraudulent emails that ask them to supply account information

Provenance

shoppers are willing to pay more for an item when they know exactly where it comes from, and they are assured that "real people" have thoughtfully selected the things from which they choose

Role theory

sociological perspective that much of consumer behavior resembles actions in a play - we as consumers seek the lines, props, and costumes necessary to put on a good performance - marketers provide us "actors" with the props we need for our varied roles (ex: up and coming executive, geek, hipster, big man on campus)

Need

something a person must have to live or achieve a goal

Culture Jamming

strategies that attempt to disrupt or satirize messages from corporations - disrupt efforts by the corporate world to dominate our cultural langscape

Third-Party Response

take legal action against the merchant, register a complaint with the Better Business Bureau, or write a letter to the newspaper

Big data

the collection and analysis of extremely large databases

Positivism (modernism)

the current dominant paradigm which emphasizes that human reason is supreme and that there is a single, objective truth that science can discover - encourages us to stress the function of objects, to celebrate technology, and to regard the world as a rational, ordered place with a clearly defined past, present, and future. - this paradigm is being challenged by the newer paradigm of interpretivism (post modernism)

Locational privacy

the extent to which a person's activities and movements in the physical world are tracked by his or her devices such as smartphones

Materialism

the importance people attach to worldly possessions - materialists are more likely to value possessions for their status and appearance

Heavy users

the most faithful customers to a company

Popular culture

the music, movies, sports, books, celebrities, and other forms of entertainment that the mass market produces and consumes - both a product of and an inspiration for marketers

Social Media

the online means of communication, conveyance, collaboration, and cultivation among interconnected and interdependent networks of people, communities, and organizations enhanced by technological capabilities and mobility

Digital native

young people who have grown up with computers and mobile technology; multitaskers with cell phones, music downloads, and instant messaging on the internet; people who are comfortable communicating online and by text and IM rather than by voice