MKT302 Final Quiz

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Information Power

a person possesses information power simply because he or she knows something others would like to know

The market maven

a person who likes to transmit market place information of all types

Bounded Rationality

"Good enough" perspective on decision making

Decision Making steps

(1) Problem recognition (2) information search (3) evaluation of alternatives (4) Product Choice (5) Post purchase evaluation

Prospect Theory

Challenges traditional rational choice theory by considering how people actually make decisions rather than how rational indiviudals should make decisions

Conformity

Change in beliefs or actions as a reaction to real or imagined group pressure

Step 1: A change in the ideal state (opportunity recognition)

A consumer craves a sweet drink after working a long shift

Brand Community

A group who share a set of social relationships based on usage of or interest product

Social Scoring

Both customers and service providers increasingly rate one another's performance

What are the 5 C's of Marketing Analysis

Company Collaborators Customers Competitors Context

Simple additive rule

Consumer chooses the option that has the largest number of positive attributes

Cognitive Decision Making

Deliberate, rational, Sequential

Buyclass Theory of Purchasing

Divides organizational buying decisions into three types

Brand Loyalty

a pattern of repeating purchasing behaviors that involves a consious decision to continue to buy the same brand

Affective Decision Making

Emotional, instantaneous

Step 4: Product Choice

Feauture creep - when products become too overly complex with features so the customer cannot understand

Avoidance Groups

Groups that we do not want to be associated with

Straight Rebuy

Habitual decision, automatic choice EX: starbucks purchasing Oatly oat milk for their lattes

What is hyperchoice?

Having too many choices, forces consumers to make repeated decisions that drain psychological energy while decreasing smart choice abilities

Power Dynamics

How much influence someone has over their family/living situation

Collective value creation

Idea of experienced product users coaching new users in ways to maximize their enjoyment of the product

Endowment Effect

Implication of loss aversion, describes the tendency of indivudals to assign a higher value to items they own compared to the value they would assign if they did not own them

High Price Alternatives

People assume that higher-priced alternatives are better quality than a lower priced option

Diminishing Sensitivity

People become less sensitive to changes in wealth of value as the magnitude of those changes increase or move away from the reference point

Certainty Effect

Overweighting of outcomes that are obtained with certainty relative to outcomes that are merely probable

Buzz Building

Marketers stimulate WOM to build buzz around a product or service

Heuristics

Mental shortcuts that allow people to solve problems and make judgements quickly and efficiently

Superordinate category

More abstract Ex: drinks More Specific: Fruit juice, pop, energy drinks

Expected Utility Theory

People chose the option with the highest expected utility

Rational Perspective

People integrate as much information as possible about what they already know about a product

Organizational Buyers

People who purchase goods and services on behalf of companies for the companies use

What are the 4 P's of the marketing mix?

Product Place Promotion Pricing

What is an example of a simplifying strategy?

Purchasing the same product as last time

Nudge Theory

Requiring people to opt out if they do not want to do something makes them more likely to comply

Legitimate Power

Sometimes we grant power by virtue of social agreements, such as the authority we give to police officers, soldiers, and doctors.

Lexicographic Rule

The brand that is the best on the most important attribute (higher camera quality, will always choose base on that one aspect)

Habitual Decision making

The choices made with little or no concious effort

Weighted additive rule

The consumer takes into account the relative importance of of the attributes by weighing each one

Conjunctive Rule

The decision maker establishes cut-offs for every attribute, but rejects a brand that does not have all attributes

Reward Power

a person or group with the means to provide positive reinforcement

Risk adverse

When exposed to gains

Risk Seeking

When exposed to losses

The Red Sneakers Effect

a term given individual's action that are nonconforming

Surrogate Customer

a third party we retain to provide input into our purchase decision (professional shoppers, interior designers)

Reference Group

an actual or imaginary individual or group that significantly influences an individuals evaluations, aspirations, or behavior (models, star athletes)

Product Curators

an individual working on behalf of manufacturers or stores that includes reccomendations on how to use product

Sunk Cost

any expenditure we have already made that we are unable to get back (financial, emotional, time-related)

A decline in the quality of the actual state (need recognition)

becoming thirsty after a long workout

Habitual Decision Making

behavioral, unconcious, automatic

Basic level category

classifying products, have a lot in common (healthy vs unhealthy drinks)

Sunk Cost Fallacy

consumers continue a behavior or endeavor as a result of previously invested resources (time, money effort)

Export Power

derives from the knowledge one possesses about a content area (Gordon Ramsay endorsing a beverage)

Innovative communicators

early purchasers, like to take risks and try new things

Step 3: Evaluate Alternatives

evoked set: alternatives a customer knows about considerate set: The consumer searching for a drink is looking for a healthier option

Product involvement and utility

how much a person will use the product to satisfy the need

Referent Power

if a person admires the qualities of a person or a group, they try to copy the referent's behaviors (modify what they do to conform)

Collective decision-making process

includes two or more people who may no have the same level of investment in the outcome, the same tastes and preferences or same consumption

Opinion leaders

individuals that are frequently able to influence others' attitudes or behaviors

New Task

involves extensive problem solving (company has yet to make this decision yet)

Modified Rebuy

involves limited decision making, organization wants to repurchase but with minor changes

Responsibility

more disagreements about a decision if there are long term Concequences

Probability Weighting

overweight low-probability events, making risky choices more appealing and underweight high-probability events impacting how we asses the likelihood of different outcomes

Loss Aversion

people hate losing things more than they enjoy getting things

Compensatory rules

products make up for its shortcomings on one dimension by excelling on another

Enthnocentrism

refers to the belief that products from other places are inferior to local versions

Context Effects

refers to the influence of environmental factors on one's perception of a stimulus

elimination-by-aspects rule

similar to the lexi rule, buyer evaluates brand on the most important attribute but imposes a cut off.

Constructive Processing

states that we we evaluate the effort well need to make a particular choice

Step 2: Informative Search

survey the environment for the appropriate data to make a reasonable decision

Covariation

the association among attributes that may or may not actually influence one another Ex: using a cars looks to judge other abilities

Intertia

there is less effort involved with picking a familar brand

Availability Heuristic

things come to mind more easily are believed to be far more common

Define Purchase Momentum

when initial impulse purchases increase the likelihood that we will buy even more, even if the products are unrelated

Post-Purchase evaluation

when we decide whether or not the product or service we selected meets our expectations

Interpersonal Need

your personal investment in the group


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