MKTG 3323 Final Exam FANG
Types of Evaluation Processes
1. Attribute-based 2. Affect-based
Receiver
(Decoding) consumers who read, hear, or see the message
Market Characteristics
-number of alternatives -price range -store concentration -information availability
Primacy Effect
At the beginning and is greater processing, rehearsal. material presented early in a message is most influential (for highly involved audiences).
Recency Effect
At the end and is still present in the working memory. material presented later in the message is most influential (for uninvolved audiences).
5 Categories may be retrieved as a result of Internal Search
Awareness Set Unawareness Set Consideration or Evoked Set Inert Set Inept Set
Competitive Advertising
Compare positive and negative aspects of brand to competitor. Mostly in print and TV Media.
Cognitive Dissonance Conditions
Consumer is aware that there are many attractive alternatives. Decision is difficult to reverse. Decision is important and involves risk. Consumer has low self confidence.
Brand Inertia
Consumers buy a product repeatedly without any real attachment.
Elaboration Likelihood Model Peripheral to Persuasion
Cues - Fear - Desire 1. I just need a car 2. Sexy Girls 3. I can pay 4. This is the car for me
Noncompensatory Models
1. Conjunctive Rule 2. Disjunctive Rule 3. Lexicographic Rule 4. Elimination-by-Aspects Rule
Factors Influencing External Search
1. The ease of obtaining information from the source 2. The objectivity of the source 3. The trustworthiness of the source 4. The speed with which the information can be obtained
Primary Group
A group that includes members who have frequent, direct contact with one another. Ex. Family unit Have the most influence on their members.
Non-comparable choices: Consider two alternatives
A high definition TV, or a Trip to Hawaii
Disatisfaction
A mild, negative affective reaction resulting from a favorable appraisal of consumption outcome.
Satisfaction
A mild, positive emotional state resulting from a favorable appraisal of a consumption outcome
Customer/Consumer Commitment
A strong feeling of attachment, dedication, and a sense of identification with a brand.
Four Basic Type of Factors that influence Consumers External Search
Market Characteristics Product Characteristics Consumer Characteristics Situation Characteristics
Consumer Characteristics
Experience and Knowledge perceived Risk attitude toward shopping
Net Promoter Score (NPS)
Fred Rechiheld A service feedback rating system. You only need one question.. How likely is it that you would recommend Company X to a friend or colleague? NPS = % of promoters(9's & 10's) - % of detectors (0 through 6)
Factors Affecting Desired State
Goals, Aspirations, and change of circumstances. e.g. ( I saw a flat screen TV at my friends house. The image is much better. I'll buy one).
Three major types of decision making process
Habitual Decision Making (Routine) Limited Decision Making Extended Decision Making (Extensive)
Competitive Ads
High Market share brands should avoid comparative ads.
Prepurchase Search
Information gathered for the consumption problem at hand. Internal & External Searches
Situation Characteristics
Time availability Task Definition (such as gift giving) Pleasant physical surroundings
Serial Position Effect
Occurs when the order of presentation of information in a list influences recall of the information in the list. Placement of information at the beginning, middle, or end of a message impacts the recall of the information. Primary Effect (Beginning) Recency Effect (End)
The Nature of Information Search
Ongoing Search Prepurchase Search & (Internal & External Search)
Direct Comparative Advertising
When one brand is compared specifically with another brand. Should be used by low market share brands.
Indirect Comparative Advertisements
When the comparison brand is not specifically mentioned but instead refers to competitors (e.g. Industry average). Should be used by moderate share brands. Example: Burger King Ad with a guest with Mcdonalds boots on.
Reference Group
a group of individuals who have significant relevance for a consumer and who have an impact on the consumer's evaluations, aspirations, and behavior.
Confirmation
a perceived state where performance perceptions equal expectations.
Positive Disconfirmation
a perceived state where performance perceptions exceed expectations.
Negative Disconfirmation
a perceived state where performance perceptions fall short of expectations.
Compensatory Rule
allows consumers to select products that may perform poorly on one attribute by compensating for the poor performance by good performance on another attribute. Ex. "It's okay this car isn't very stylish because it gets good gas mileage."
Cognitive Dissonance
an uncomfortable feeling that occurs when a consumer has lingering doubts about a decision that has already been made. Sometimes known as buyers regret.
Elaboration Likelihood Model
attitudinal change model that shows attitudes are changed based on differing levels of consumer involvement through either central or peripheral processing.
Central Route to Persuasion
consumers are highly involved and will spend considerable effort in comprehending the message.
Peripheral Route to Persuasion
consumers are not involved with a message or lack either the motivation or ability to process the information.
Commitment and Consistency Principle
consumers feel pressured to maintain stable beliefs, attitudes, and behaviors. Inconsistencies often invite interpretations of personality flaws.
Habitual (Routine) Decision Making
consumers generally do not seek information at all when a problem is recognized and select a product based on habit. Brand Loyalty Brand Inertia
Extended Decision Making
consumers move diligently through various problem-solving activities in search of the best information that will help them reach a decision. This occurs when there are significant amounts of purchase risks involved with the decision.
Scarcity Principle
consumers often want what they can't have (e.g., Limited edition, sale ends soon, one time offer). Consumers also want things that may not be available in the future.
Limited Decision Making
consumers search very little for information and often reach decision based largely on prior beliefs about products and their attributes. This occurs when there are relatively low amounts of purchase risk and product involvement.
Authority Principle
consumers tend to comply with those in authority. People in uniforms (cops or fireman) People whom have titles or credentials (Doctors or Lawyers)
Liking Principle
consumers tend to comply with those whom they like. Familiarity Physical Attractiveness Similarity Ingratiation
Medium
could be personal (face-to-face interaction) or impersonal (ads on television, radio or the internet).
brand loyalty
deeply held commitment to rebuy a product or service regardless of situational influences. Consumers have a true affection for the product.
Affect-Based Evaluation
evaluate products based on the overall feeling that is evoked by the alternative. Experiential decision making.
Central Cues
information presented in a message about the product itself, its attributes, its advantages, or the consequences of its use.
Secondary Group
interactions with the group is much less frequent than the primary group. Ex. Social clubs and professional organizations The influence is less.
Ongoing Search
involves external search activities independent of solving an immediate purchase problem. (Focuses on simply staying up to date on a topic of interest).
Formal Group
is a group in which a consumer formally becomes a member. (ex. church member) Normally, groups generally have a set of stated rules, accepted values, and codes of conduct.
Noncompensatory Rule
strict guidelines are set prior to selection and any option that does not meet the specifications is eliminated from consideration. Ex. "I'll only buy a car that gets good gas mileage."
Inept Set
subset considered unacceptable
Inert Set
subset to which consumers are indifferent
Balance Theory Basic Rule
multiplication of the sign of the relations must come out with a positive sign. My friends friend is my friend (++=+) My friends enemy is my enemy (+-= -) My enemy's friend is my enemy (-+=-) My enemy's enemy is my friend (--=+)
Peripheral Cues
non-product related information presented in a message (attractiveness of spokesperson, imagery, music, # of arguments presented etc.).
Confirmatory Bias
tendency for expectations to guide performance perceptions. Ex. "This class is going to be really bad! I need to ask my friends how bad this teacher is and how hard the tests are."
Complaining Behavior
occurs when a consumer actively seeks out someone to share an opinion with regarding a negative consumption event
Unawareness Set
options not recalled
Feedback
the responses that the receiver sends back to the source.
Consideration or Evoked Set
the subset of options acceptable for further consideration.
attribution theory
focuses on explaining why a certain event has occurred.
Awareness Set
total universe of options recalled from memory
Social judgment theory
proposes that consumers compare incoming information to their existing attitudes about a particular object or issue and that attitude change depends upon how consistent the information is with the initial attitude.
Expectancy/Disconfirmation Theory
proposes that consumers use the expectations as a benchmark against which performance perceptions are judged.
Elimination-by-Aspects Rule (EBA)
rank order attributes in importance. Take top ranked attribute and eliminate any option not suppressing cut-off. Go to the next attribute and do same. Continue until one option left. I will rank the attributes by importance and define the minimum required values.
Lexicographic Rule
rank order attributes. Select option rated highest on most important attribute. If a tie, go to the next attribute. I will rank the order attributes and narrow down alternatives by comparing the first ranking.
Source Effects
refer to the characteristics of the person or character delivering a message that influence persuasion. Creditability Attractiveness Likeability Meaningfulness
Noise
represents all the stimuli in the environment that disrupt the communication process.
Disjunctive Rule
set cut-off (high) and accept options above it on any attribute. Is this product does not have the features I want, then it must have features that will make up for the loss.
Conjunctive Rule
set minimum cut-off and eliminate all options below it on any attribute. Product must meet my minimum requirements.
Message Effects
used to describe how the appeal of a message and it's construction affect persuasion.
Reciprocity Principle
when someone does you a favor, you feel obligated to return it in kind. e.g. gifts Consumers often return larger favors than they receive.
Aspirational Group
group in which an individual would like to belong, such as successful businessman, athletes, performers. Ideal Self
Informal Group
group that has no membership or application requirements and that may have no code of conduct.
Dissociative Group
group to which a consumer does not want to belong or be like. ex. teenagers tend to avoid clothing styles associated with older consumers. The store GAP came about because kids did not want to dress like their parents. Ex. VH-1 ads: Keeping you from becoming your parents.
Types of Groups
Primary and Secondary (Brand Community) Formal & Informal Aspiration & Dissociative
Product Characteristics
Product Differentiation
Factors Affecting Actual State
Product depletion, failure of product, to meet expectations, and out of style. e.g. (I'm running out of milk, I'd better go for groceries.)
Balance theory
Proposes that people have a preference to maintain a balanced state among the cognitive elements if these elements are perceived as forming a traid system. Heider
Attitudes
Relatively enduring overall evaluations of objects, products, services, issues or people. Enduring and learned, long term memory
Basic Communication Model
Source (encoding)-> Message-> Medium-> Receiver(decoding)-> Feedback
Actual State
Need Arising From: Internal Stimuli - Hunger External Stimuli - Friends Consists of consumer Need.
Consumer Decision-Making Process
Need Recognition-> Search for Information-> Evaluation of Alternatives-> Choice-> Postchoice Evaluation
Desired State
State where they buyers needs are fulfilled and the buyer is satisfied. Consists of a consumer Want.
need recognition
The first stage of the buyer decision process, in which the consumer recognizes a problem or need. Desire State or Actual State
Equity Theory
Theory holds that people will analyze the ratio of their outcomes and inputs to the outcomes and inputs of the other party (a company or another consumer) in the exchange. Satisfaction occurs when the ratios of the outcomes and inputs for each party to the exchange are approximately equal. Outcome A. Outcomes of B ________________________________________________________ Inputs of A Inputs of B
Elaboration Likelihood Model Central Path to Persuasion
Thinkinking- Logically 1. I need a car 2. The price is great 3. High- Performance 4. Top car of the Year
Cialdini's 6 Behavioral Principles
1. Liking Principle 2. Commitment and Consistency Principle 3. Reciprocity Principle 4. Scarcity Principle 5. Social Validation Principle 6. Authority Principle
Customer Share or Share Wallet
Amount Spent on your products = _________________________________________________________ Total amount Spent on Category
Internal Search
Deliberate retrieval of information stored in memory. About products, services, and experiments. Knowledge is related directly to consumers' experiences with products and services.
Attitude Change Theories
Elaboration likelihood model, Balance theory, and Social judgement theory
External Search
Engaging personal and market sources of information. Gathering of information from sources external to the consumer such as friends, family, salespeople, ads, independent research reports, and the internet.
Attribute-Based Evaluation
Evaluate alternatives across a set of attributes that are considered relevant to the purchase situation. Rational decision making.
Message Appeals
Sex, Humor, Fear, and Violence.
Customer Share or Walltet Share
The portion (percentage) of resources allocated to one brand from among the set of competing brands within a product category.
Brand Loyalty
is the degree to which customers holds a positive attitude towards a brand, has a commitment to it, and intends to continue purchasing it in the future. Two General Approaches: Behavioral Attitude
Phased Strategy
is when consumers sequentially use two non-compensatory models, or first use a non-compensatory model and then a compensatory approach.
Social Validation Principle
the perceived validity (or correctness) if an idea increases as the number of people supporting the idea increases. Ex. "The proof is in the numbers".