Marketing 313 Exam 1

2 types of compensatory decision rules

1. additive: ranking products against each other for each attribute, then choosing one with lowest total number. Weighted additive: assigning values that are greater for more important attributes e.g. 1 point per inch of TV, 10 points total for LED 2. multi-attribute: assigning score to each product for each attribute, then multiply weighting of attribute by rating e.g. Sony TV is a 7 for size, size importance = 6, so 7*6 plus other attribute answers

2 notes on Maslow's hierarchy of needs

1. bottom ones need to be satisfied before you can move up to other needs 2. hierarchy criticized because it's seen as having a very Western view - other cultures would order needs differently LOOK UP

3 Gestalt concepts

1. closure: people perceive an incomplete picture as complete e.g. photos cutting off parts of vodka bottle, scrambled, still can tell what it is; incomplete letters 2. similarity: consumers group objects that share similar physical characteristics 3. figure-ground: one part of the stimulus will dominate (figure) while other parts recede into background (ground) e.g. seeing vase as figure v. seeing faces looking at each other as figure in same picture

3 categories of consumer decision making

1. cognitive (head) 2. habitual (hand) 3. affective (heart). most time spent on cognitive decision making

2 types of decision rules

1. compensatory: allow for trade-offs among attribute values - low values on one attribute may be compensated by high values on another attribute 2. non-compensatory: do NOT allows for trade-offs among attribute values. elimination of alternatives that do not meet certain criteria. consumers may start with non-comp. methods, then move to comp. methods for reduced consideration set - they're not mutually exclusive methods

4 types of non-compensatory decision rules

1. conjunctive: set minimum cutoffs for each criterion and accept product that meets or exceeds ALL criteria levels ("must be this AND this") 2. disjunctive: set minimum cutoffs for each criterion and accept product that exceeds minimum level on AT LEAST ONE criterion ("must be this OR this") 3. lexicographic: rank attributes by importance, choose best option for most important criterion. if tie, move to second most important criterion ("most important: LED") 4. elimination-by-aspects: set minimum cutoff for each criterion, then select one criterion and eliminate options that don't exceed cutoff. continue to eliminate options until only one remains ("criterion 1, 2, 3")

4 broad consumer behavior lessons

1. consumer behavior is a process that extends beyond the mere act of buying, 2. people often buy products not for what they do, but for what they mean, 3. "we are what we have:" possessions affect the way we feel about ourselves and others, 4. possessions have been theorized as extensions of the self

4 kinds of heuristics

1. covariation: assuming correlation between two unrelated variables e.g. believing that exterior of used car indicates quality 2. country of origin: ethnocentrism with thinking French wine is best because it's French 3. branding cues: tend to prefer familiar brands 4. price / quality inferences: thinking high price = higher quality

3 biases from using heuristics

1. default bias: people usually inferring that default is way to go and that there's a reason for it being the default e.g. higher % of organ donors in countries that have opt-out 2. sunk cost bias: failing to ignore costs already incurred, choosing trip that was more expensive even though cheaper one you also already paid for will be more fun 3. anchoring and adjustment: being influenced by first impression of numbers e.g. stating last two digits of SS serving as benchmark for WTP for different products

3 aspects of culture

1. ecology: physical surroundings e.g. space limits in European apartments. technology used to negotiate ecology 2. social structure: laws / norms / rituals 3. ideology: set of beliefs / principles about order and fairness

3 step process for perception

1. exposure 2. attention 3. interpretation. the full process is sensory stimuli -> sensory receptors -> exposure -> attention -> interpretation

4 other psycho-social needs not in Maslow's hierarchy

1. need for achievement: strongly value personal accomplishment 2. need for affiliation: to be in the company of other people 3. need for power: to control one's environment 4. need for uniqueness: to assert one's individuality

Hofstede's cultural dimensions (5)

1. power distance: relation to authority 2. individualism / collectivism: relation to group 3. masculinity / femininity 4. uncertainty avoidance 5. long-term orientation

process steps for cognitive decision making

1. problem recognition 2. information search 3. evaluation of alternatives 4. choice

2 ways to measure memory

1. recognition: seeing if someone remembers stimulus from before 2. recall: seeing if someone can "spontaneously generate" a previously experienced stimulus at a later time, no stimulus given

3 ways classical conditioning can be applied to marketing

1. repetition (INCREASES LEARNING, used to associate sound of A-S with relief) 2. conditioned product associations 3. stimulus generalizations

3 types of meanings encoded into LTM

1. semantic meaning: general knowledge / facts, typical SYMBOLIC associations e.g. rich people drink champagne 2. episodic memories: life events, personal experiences 3. narrative (procedural) memories: knowledge of how to do things, implicit, difficult to verbalize. semantic and episodic memory are types of DECLARATIVE memory under LT memory, defined as "knowledge that..." and factual / explicit

how many ads do you see in a day?

3000-3500 ads / logos / etc. HOWEVER, you don't REMEMBER that many, showing importance of attention step in perception process - exposure isn't everything

how many items can you store in ST memory?

7 +/- 2 items can be stored in ST memory

Harley-Davidson example from class

HD now finding it difficult to get past macho act that worked well with baby boomer men. they had a very clear image of their target consumer, and the brand came to reflect a lifestyle. these previous marketing successes are now limiting growth, since consumers outside this demographic. want to attract younger buyers and women, but much of their marketing still caters to "grizzled men reliving their youth." essentially, they're using the same old approaches but hoping to attract new buyers. what the product means is at odds with new buyers' (women's) self-images

power distance (PDI)

Hofstede cultural dimension. relation to authority, how much people accept / expect that power is distributed unequally, how strong roles of hierarchies are in a society. High PDI (China) means you expect authority, unequal power distribution. Low PDI (USA, Denmark) means superior / subordinates seen as closer to equal

which state do marketers typically influence to trigger problem recognition?

IDEAL state, not actual state. can educate customer, remind customer, or exaggerate problem

absolute threshold definition

LOOK UP minimum amount of stimulation a person can detect on any given sensory channel

example for each level of Maslow's hierarchy of needs

Lowest: 1. physiological: ZzzQuil for sleeping 2. safety: Michelin "because so much is riding on your tires" 3. love / belonging: Hallmark cards, American Express with belonging membership 4. esteem / ego: American Express with black card rarely seen 5. self-actualization: Nike ID creating your own shoe

involvement and where types of decisions fall on involvement scale

a person's perceived relevance of the object based on her inherent needs / values / interests. involvement reflects our level of motivation to process information about a product / service. habitual is LOW involvement, while cognitive AND affective are HIGH involvement. inertia describes consumption at low end of involvement

differential threshold definition

ability of a sensory system to detect changes in / differences between two stimuli. People tend not to notice relatively small differences. just noticeable difference: incremental (minimum) change required to detect a difference between two stimuli. If you don't want consumers to notice difference (changing syrup in Fruit Rollups, downsizing packages), fall below JND

economies of scope

achieved when producing two or more distinct goods is cheaper than producing each separately. total cost of production decreases as a result of increasing the number of different goods produced

subliminal advertising

ad or stimulus shown so quickly that it doesn't meet the threshold of "liminal" recognition. it's controversial, but largely ineffective. subliminal exposure can influence people, but effects not predictable, limited. simple influence, not necessarily a specific brand

conditioned product associations

application of classical conditioning to marketing. example with Skyy Vodka being paired with attractive women: arousal from women is unconditioned response, aiming to have customer be aroused by brand. also seen with Nike being associated with Tiger Woods, want brand to be associated with excellence

stimulus generalization and 3 examples

application of classical conditioning to marketing. tendency for stimuli SIMILAR to a conditioned stimulus to evoke similar, UNconditioned responses e.g. keys jingling made dogs salivate. can be seen with 1. family branding by Heinz trying to get favorable response to other products since there was a favorable response to ketchup, 2. line extensions with Listerine, 3. licensing with Sunkist, 4. lookalike products

need definition

basic biological motive, requirement to function

advertising wear out definition

becoming so used to seeing an ad that you stop paying attention to it. seen with LaCoste brand being promoted by General Mills like a cereal, available in every outlet. however, this eliminated the exclusivity element of the brand, hurting customer's preference for it

values definition (Rokeach)

beliefs about what is right, important, and good; beliefs that some conditions are better than others. values change over time e.g. Western values include materialism now, while from 1900-1980 they included "cheap, practicality." conscientious consumerism with LOHAS (lifestyles of health and sustainability) emerging

perceptual positioning equation

brand perceptions = functional attributes + symbolic attributes

how do cognitive and habitual decision making outcomes differ?

cognitive decision outcome: maximizing. habitual decision outcome: satisficing

affective decisions

decisions not necessarily made in a rational, sequential manner. doing things that make people feel good, forming mental images of consumption, brands being associated with positive emotions

terminal values definition (Rokeach)

desired end states e.g. a comfortable life, a sense of accomplishment, wisdom

vision (perception) with colors

different meanings for colors across the world e.g. white represents innocence in US, but it represents death / mourning in East Asia. Red: intensity of blood / fire, active, passionate, aggressive. brown: nurturing of Mother Earth, reliability, support, dependability. pink used to color insulation, differentiating product

hedonic need definition

experiential, emotional, serving a pleasurable purpose e.g. chocolate, perfume ads. utilitarian / hedonic needs are NOT mutually exclusive. one may just be larger than the other in influencing customers. certain kinds of watches have hedonic benefits, not just functional benefits

long-term orientation (LTO)

extent to which people exhibit a pragmatic, future-oriented perspective (high LTO) rather than a short-term POV (low LTO). Low LTO: US, value personal stability, instant pleasure, focus on pursuit of happiness. High LTO: China, Japan, value ordering of relationships by status, persistence, sense of shame, focus on peace of mind, importance of education

uncertainty avoidance (UAI)

extent to which people in a country are threatened by ambiguous / risky situations and exhibit a preference for continuity / stability. High UAI: Greece, Portugal, uncertainty builds tension, rules and proscribed behavior used. Low UAI: UK, Denmark, education focuses on flexibility / individual choice, creativity and innovation fostered

masculinity / femininity (MAS)

extent to which people value assertiveness / earning / material possessions (masculine, Germany, US, being a winner is valued, problems seen as opportunities) as opposed to nurturing / caring roles (Sweden, modesty valued, priorities are relationships / quality of life). collectivism and feminism overlap

sensory receptors

eyes, ears, nose, mouth, skin

problem recognition definition and 2 types

first step in cognitive decision making, perceived gap between desired and current state. 1. need recognition: ACTUAL state DECREASES to create gap e.g. car breaks down 2. opportunity recognition: IDEAL state INCREASES to create gap e.g. new phone model comes out

cognitive learning theories

focus on consumers as problem solvers who learn when they observe relationships. DIFFERENT from behavioral learning theories

behavioral learning theories and 2 types

focus on stimulus-response connections. consumer's mind is black box, NOT focusing on process within consumer's mind. 1. classical conditioning with Pavlov 2. instrumental / operant conditioning with Skinner

fixed ratio reward v. variable ratio reward

for instrumental conditioning. fixed ratio: reward given every time or every x amount of times. variable ratio: reward interval varies. since variable ratio is less predictable, you have to respond at a constant rate e.g. gambling and lottery games

embeds definition

for subliminal techniques. figures that are inserted into magazine advertising by using high-speed photography / airbrushing. Subliminal auditory perception also used in ads

Maslow's hierarchy of needs

from bottom: 1. physiological (breathing, food, water, sleep), 2. safety (security of body, health, morality, employment), 3. love / belonging (friendship, family, sexual intimacy, acceptance by others), 4. esteem / ego (self-esteem, confidence, achievement), and 5. self-actualization (self-fulfillment, morality, creativity, spontaneity)

associative networks

from memory lecture. web of associations between different marketing materials, product categories, features, and competitors

8 types of brand positioning

from perception lecture. 1. lifestyle (Grey Poupon is high class) 2. price leadership (Walmart with no frills) 3. attributes (Bounty is "quicker picker upper") 4. product class (7UP as beverage instead of medicine) 5. competitors (Northwestern Insurance is the quiet company) 6. occasions (use Wrigley gum when you can't smoke 7. users (Levi's Dockers targeted to young men) 8. quality (quality is job 1 at Ford). these are different approaches to influencing how customers perceive brands / products

attention definition and 3 properties

from perception lecture. extent to which mental activity is devoted to a stimulus. attention is 1. selective 2. capable of being divided 3. limited

product placement implications

from perception lecture. it's an effective way to get EXPOSURE, but sometimes products not noticed (no attention) or not used in way companies want them to be used (not interpretation they want)

utilitarian need definition

functional or serving a practical purpose e.g. microwave, sunscreen ads

chunking

grouping items together to form large items, easier to remember 12 numbers when string is framed as 3 dates since 3 items are easier to remember than 12. you can also remember them as years presidents were shot for semantic memory, even easier

list of values approach

have consumers rank values e.g. self-respect, security, others in order of importance in order to ID segments of consumers

individualism / collectivism (IDV)

how much people look after themselves and their immediate family only (individualist, US, UK, strict division between private and work life, "keep nice things for themselves" instead of sharing) v. people belonging to in-groups in exchange for loyalty (collectivist, China, shame is an important emotion, achieve shared goals)

drive theory

humans motivated by biological needs LOOK UP

endowment effect

if you give someone something for a while, they become attached to it e.g. 24-hour test drive

smell (perception)

impacts perception of environment e.g. "dinosaur breath" scent used to increase realism of museum exhibit

examples of triggers of problem recognition

inventory runs out, family life cycle with empty nest now, changing reference groups (people you ID with), dissatisfaction, boredom / novelty-seeking, new needs stimulated by ads / new products. REMEMBER that these trigger problem recognition, the first step in cognitive decision making

difference between knowledge structure and knowledge content

knowledge structure: the way knowledge is organized e.g. categories and prototypes. categories can be hierarchically organized, one member more typical of category. knowledge content: info we already have in memory: schemas, scripts, associations

instrumental (operant) conditioning definition

learning to perform behaviors that produce positive outcomes and to avoid behaviors that produce negative outcomes. VOLUNTARY behavior

touch (perception)

level of familiarity / trust created with touch e.g. wait staff who touched diners received greater tips, touching an item for 30 seconds increased attachment and WTP

short-term memory and 2 ways to enhance it

limited capacity (5-9 items), draws from sensory memory AND long-term memory, item persists as long as it is rehearsed, duration about 15-30 seconds. also called conscious / working memory. it's essentially a memory buffer. ST memory is enhanced through 1. chunking 2. rehearsal

physical influences on attention

low arousal leads to little attention, but too much arousal inhibits attention. MODERATE arousal facilitates attention. humor and eye-catching ads can cut through the clutter, violate people's expectations, get your attention

interpretation definition

meaning assigned to sensory stimuli - based on a schema

instrumental values

means to get to terminal values e.g. must be ambitious (instrumental value) in order to have a comfortable life (terminal value), must be honest (instrumental) in order to achieve happiness (terminal)

INVOLVEMENT idea really important

ok

schema definition

organized, general knowledge of the world. associations linked to a CONCEPT. can have a schema for a brand e.g. McDonalds schema may include: fast, cheap, greasy, unhealthy

classical conditioning

pairing a stimulus (unconditioned stimulus, food) - that generates a response - to another stimulus (conditioned stimulus, bell) that does not elicit a response on its own. INVOLUNTARY behavior. unconditioned response is salivating when food presented, conditioned response is salivating when bell rings

long-term memory and 2 ways to enhance it

part of memory where info is placed for later use. fed by ST memory. virtually UNLIMITED capacity and duration. getting info into LT memory takes effort, you need to encode it. enhanced by 1. recirculation: info remembered via simple repetition without active rehearsal 2. elaborative rehearsal: processing at deeper levels, focusing on meaning, linking to other info in memory, not just repeating over and over.

exposure definition and ways to get visual exposure

process by which the consumer comes into physical contact with a stimulus. marketers can gain visual exposure through ads, point-of-purchase displays, shelf space (eye level), product placement

product v. message involvement

product involvement: a consumer's level of interest in a particular product. higher involvement if there's a perceived risk e.g. expensive or potential for embarrassment with wrong choice. message involvement: amount of interest consumers have in specific media vehicles e.g. print is high-involvement since the reader actively processes info, while TV is low-involvement medium with passive viewer

visual design (perception)

putting cookie in bottom right (Oreo): heavier, more filling, away from fulcrum. in top left: lighter b/c gravity, closer to fulcrum. Coke bottle redesigned back to classic shape to differentiate.

learning definition

relatively permanent change in behavior that is caused by experience. learning is a way to start / keep brand loyalty

primacy effect

remembering first items in a sequence

recency effect

remembering last / most recent items in a sequence

extremes of repetition in marketing

repetition increases learning, and more exposures = increased brand awareness. however, when exposure decreases, extinction occurs. too much exposure leads to wear out. there are DIMINISHING returns to repetition

2 types of information search

second step in cognitive decision making process. 1. internal: memory, thinking 2. external: word-of-mouth, media, store visit, trial. the most believable source of info is a mix of marketer- and non-marketer-controlled info

sensory stimuli

sights (lots of research on vision in sensory marketing), sounds, smells, tastes, textures

script definition

simple, highly structured, and familiar sequence of events. associations linked to HOW WE DO SOMETHING, process

want definition

specific manifestation of a need e.g. you WANT steak because you're hungry (you have a need to eat). specific examples asking if a product is a want or a need are trick questions since a product can be both a want and a need. a house fulfills need for shelter, but want is reflected with the specific house. products for less obvious needs may fulfill higher-order psycho-social needs too.

sensory memory

takes in information (stimuli / sensory input), very short duration (<1 second for vision, around 3 seconds for hearing), keeps only what is processed. very little info retained at all. temporary storage, but LARGE capacity. ATTENTION determines what items move into ST memory

definition perception

the process by which sensations are selected, organized, and interpreted

semiotics definition and triangle parts

the study of how marketers use symbols to create meaning, links object/product, sign/image, and interpretant/meaning concepts in triangle e.g. Marlboro cigarettes (object), cowboy (sign), ruggedness (interpretant)

consumer behavior definition

the study of the PROCESSES involved when individuals or groups select, purchase, use, or dispose of products / services / ideas / experiences to satisfy NEEDS and DESIRES. having and being follows from buying

2 sets for evaluation of alternatives

third step in cognitive decision process. 1. evoked set: all brands that come to mind when thinking about product category. need to be in evoked set in order to be in consideration set 2. consideration set: brands you may actually buy. evoked and consideration sets depend on if you make choice in-store or outside e.g. writing cereal on list instead of Cheerios

norms definition

under social structure part of culture. rules dictating what is right / wrong that are SOCIALLY enforced

laws definition

under social structure part of culture. rules of conduct enforced by a controlling authority e.g. no discrimination based on gender, SO women can be in the military and men can be nurses

rituals definition

under social structure part of culture. set of symbolic behaviors occurring in fixed sequence that are periodically repeated e.g. handshake v. kisses for greeting, rites of passage like Bar Mitzvah, reciprocity with gift-giving

utilitarian v. hedonic need example

utilitarian: Volvo emphasizing utilitarian benefit from seatbelt in ad while Porsche emphasizes the pleasure of having / owning vehicle in ad, more hedonic

indexing a region

viewership % / population % e.g. if your region is 25% of the country but you represent 50% of the viewership, your region would index at 200

means-end chain definition

way of linking (by laddering) specific product attributes / features to benefits / consequences to terminal values. shows alternative means to attain valued end states. laddering technique uncovers consumers' associations between specific attributes and general consequences. benefit can also be framed as an avoidance of a cost

spreading activation definition and 5 types

what memories are stored in terms of. 1. brand-specific: claims BRAND makes (it's macho) 2. ad-specific: medium / content of AD itself (macho guy uses it in ad) 3. brand identification: brand name 4. product category: how it works / where it should be used 5. evaluative reactions: positive / negative emotions

when does the highest level of search occur?

when product knowledge is moderate, in the middle. bell-shaped curve with product knowledge on x-axis, search level on y-axis. low search level with low product knowledge because consumer is least able to get / efficient at getting info. low search level with high product knowledge because they're the most able but least motivated

when are heuristics most often used?

with habitual (hand) decision making

how do you compare "non-comparable" alternatives e.g. apples and oranges?

you can compare then across more abstract, broader attributes instead of concrete ones e.g. nutritional value instead of color or taste

implications of different cultural dimensions

you can take a similar marketing approach when going into a new country with similar emphasis of values. otherwise, you have to adapt marketing strategy to new culture, deliver in culturally relevant way e.g. wine at Euro Disney. there's a belief that with a more global community, there will be increased consumer homogeneity

selective exposure examples

zipping: speeding through commercials. zapping: changing channel