Consumer Behavior Ch. 9

Diffusion of Innovations: Adopter Categories

Is a classification that depicts where consumers stand in relation to other consumers in terms of the first time they purchase an innovation

Hedonistic product

Very expensive

Social Networks: similarity

among the group's members in terms of demographic and lifestyles

Reference Group Influence: Social Norm Messages

are more persuasive than "standard messages" because the are credible and believable

Late Majority

are risk averse and slow to adopt innovation. They wait until most other consumers have adopted the new product before buying it

celebrity testimonials

based on personal usage, the celebrity attests to the product's quality

celebrity endorsement

celebrities appear on behalf of products, with which they may or may not have direct experience of familiarity

Celebrities

celebrities, particularly movie stars, tv personalities, popular entertainers, and sports icons, are symbolic reference groups because they are liked, armored, and often have a high degree of perceived credibility.

Reference Group Influence: Reference groups serves as...

comparative and normative frames of reference for a person's values and behaviors

Early Majority

consist of consumers who buy innovations after the early adopter have done so

Reference Groups and Word-Of-Mouth: Word-Of-Mouth

consists of communications where satisfied customers tell other people how much they like a business, product, service, or event (could also be negative information). - the most credible forms of buying-related information - has a strong influence

Reference Group Influence: Normative Influence

consists of learning and adopting a group's norms, values, and behaviors. Comes from groups to which people naturally belong to, such as family, peers, and members of community

Early Adapters

consumers who buy new products within a relatively short period following introduction, but not as early as the innovators. Engage in word of mouth and likely to assist others who are considering adopting the new product

Risk Aversion

defines as the reluctance to take risks and low tolerance of ambiguous situations

Sources of Credibility and Reference Groups: Credibility can come from...

Formal and Informal Sources

Consumption-Related Reference Groups: Friendship Groups

Friends fulfill a wide range of needs: they provide companionship, security, and opportunities to discuss problems that an individual may be reluctant to discuss with family members

Reference Groups and Word-Of-Mouth: Social Class, Culture, Sub-Culture

Important reference groups

Marketers employ celebrities four ways...

1. celebrity testimonials 2. celebrity endorsement 3. celebrity actor 4. celebrity spokesperson

Factors Affecting Reference Group Influence: Conformity

1. inform or make members aware that brand or product exists 2. provide the individual with the opportunity to compare his or her own thinking with the attitudes and behavior of the group 3. influence the individual to adopt attitudes and behavior that are consistent with the group's norms 4. legitimize the member's decision to use the same product as other members

Characteristics of Opinion Leaders

1. opinion leaders are highly knowledgable regarding a particular product category, follow new products that come into the markets, and are often consumer innovators in their area of expertise 2. opinion leaders are self-confident, outgoing, and sociable 3. opinion leaders read special interest publications and regularly visit websites devoted to the specific topic or product category in which they specialize 4. opinion leaders and receivers belong to the same socioeconomic and age groups

Endorsers and Spokespersons

1. the synergy between the endorser and the type of product or service advertised is very important. 2. Endorsers who's demographic characteristics are similar to those of the target audiences are viewed as more credible and persuasive than those whose characteristics are not. 3. Although consumers may line an ad featuring a famous endorser, they will buy the product advertised only if they trust the marketer as well 4. Marketers who use celebrities in testimonials or endorsements must ensure that the message contents are congruent with spokesperson's qualifications.

Blogs

A discussion or informal site published on the internet and consisting of discrete entries

Sources of Credibility and Reference Groups: Formal Source

A formal source is either a person or medium providing consumption related information and tired and paid by an organization

Types of Reference Groups: Membership Group

A group to which a person belongs to, or realistically can join, is called a membership group. A group of men with whom a young executive plays poker weekly would be considered his membership group.

Types of Reference Groups: Symbolic Group

A group to which an individual is unlikely to belong to but whose values and behaviors that person adopts. An amateur tennis player looking up to a professional athlete.

Brand Community

A specialized, non geographically bound community formed on the basis of attachment to a product or brand

Sources of Credibility and Reference Groups: Informal Source

An informal source is a person whom the message receiver knows personally, such as a parent or friend who gives product information or advice, or individual met and respected online.

Reference Groups and Word-Of-Mouth: Reference Groups

Are groups that serve as sources of comparison, influence, and norms for people's opinions, values, and behaviors.

Reference Group Influence: Comparative Influence

Arises when people compare themselves to others whom they respect and admire, and then adopt some of those people's values or imitate their behaviors. A boss exerts comparative influence on the lower-level employee

Opinion Leaders are...

Category specific (specialize in one category)

Measuring opinion Leadership

Consumer researchers can measure the degree of the opinion leadership and its impact on consumption behavior by using one of the following methods. 1. the self designating method 2. the sociometric method 3. the key informant method

Factors Affecting Reference Group Influence: Group's Power and Expertise

Different reference groups may influence the beliefs, attitudes, and behavior of individuals at different times under different circumstances. "Power Groups" may bring

Credibility of Spokespersons, Endorsers, and other Formal Sources: Source Credibility

Is the believability of the endorser, spokesperson, or individual in an advertisement. Researchers have identifies the following dimensions in measuring the credibility of a person or organization: expertise, trustworthiness, and likability.

Consumption-Related Reference Groups: Virtual Communities

Many websites encourage consumers to repsond to them. The anonymity of the online environment allows people to express their views and benefit from others' views.

Factors Affecting Reference Group Influence: Power Groups

May bring about behaviors, but not changes in attitudes. Individuals may conform to the behavior of powerful persons or groups, but probably will neither change their attitudes not internalize their choices.

Effects of Time On Source Credibility: Sleeper Effect

One's disassociation of the message from its source over time, and remembering only the message content but not its source is called the sleeper effect

Consumption-Related Reference Groups: Shopping Groups

People may shop together just to enjoy shopping or to reduce their perceived risk; that is, they may bring someone along whose expertise regarding a particular product category will reduce their chances of making incorrect purchases. Membership rewards groups.

Slice-Of-Life Commercials

Promotional messages showing typical consumers in everyday situations. More effective than commercials featuring either a fantasy or emotional appeals.

Reference Groups and Word-Of-Mouth: Consumer Socialization

Providing the skills, knowledge, attitudes, and experiences necessary to function as consumers.

Sources of Credibility and Reference Groups: Source Credibility

Reference groups have a high degree of source credibility defined as a source's persuasive impact, stemming from its perceived expertise, trustworthiness, and believability.

Word of Moth Opinion Leadership: Opinion Leadership

Sociologists who studied the communications process among peers. One person- the opinion leader- informally influences others, who might be either opinion seekers or recipients.

Effects of Time On Source Credibility: Differential Decay

Suggests that the memory of a negative cue simply decays faster than the message itself, leaving behind the primary message content.

Consumption-Related Reference Groups:

The consumption related groups that influence consumers' attitudes and behavior include: friendship groups, shopping groups, virtual communities, and advocacy groups

Factors Affecting Reference Group Influence:

The degree of influence that a reference group exerts on an individual's behavior depends on the individual, product, and causal features. Conformity, the group's power and expertise, the individual's experience and personality, and the conspicuousness of the product

Factors Affecting Reference Group Influence: Product Conspicuousness

The degree of reference group influence on purchase decisions varies according to product conspicuousness. A conspicuous product is one that stands out and notices by others, such as an expensive watch or newly released digital camera. Products that are especially conspicuous and status revealing are most likely to purchase with an eye to the reaction of relevant others.

Reference Groups and Word-Of-Mouth: Family

The most important reference group because it provides children consumer socialization.

Consumption-Related Reference Groups: Advocacy Groups

The objective of consumption-focused advocacy decisions and support consumers' rights - entities organized to correct a specific consumer abuse and then disband - groups whose purpose is to address broader, more pervasive problem ares and operate over an extended period of time.

Medium Credibility

The reputation of the medium that carried the advertisement also enhances the credibility of the message. Most consumers believe that a respectable medium would only advertise products that it "knows" to be of good quality.

Vendor Credibility

The reputation of the retailer who sells the product has a major influence on message credibility. The area of credibility generated by a reputable vendor reinforces the manufacturer's message as well. The key basis for message credibility is the ability of the product, service, or brand to deliver consistent quality, value, and satisfaction to consumers.

Microblogs

has less content than the traditional blog and allow users to exchange small elements of content, such as short sentences, individual images, and video links

Factors Affecting Reference Group Influence: Relevant Information and Expertise

individuals who have firsthand experience with a product or service or can easily obtain detailed information about it; are less likely ti be influences by the advice of others. In contrast, persons who have little or no experience with an item, and do not trust advertising messages, are more likely to seek out the advice of others

utilitarian product

inexpensive, everyday

Twitter

is an online social networking service and microblogging service that enables its users to send and read text based messages of up to 140 character known as tweets

Buzz Agents

many firms enlist typical consumers to serve as buzz agents - consumers who promote products clandestinely and generally receive free sample's but not monetary payments

Klout Scores

measure the people's degree of influence online based on their abilities to generate engagement and feedback to what they post

Social Networks for hedonic products (personal pleasure)

not helpful

Social Networks

online virtual communities where people share information about themselves with others, generally with similar interests, with whom they have established relationships that, for the most part, exist only in Cyber space.

Salesperson Credibility

salespeople who engender confidence and integrity are most persuasive.

Weblogs

scores of websites enable anyone to post information on anything and everything quickly, for free, and from any location and at any time

celebrity actor

the celebrity plays a part in a commercial for the product

celebrity spokesperson

the celebrity represents the brand or company over an extended period.

Social Networks: Tigh Strength

the degree of intimacy and frequency of contact between the information seeker and the source

Innovators

the earliest consumers to buy new products they are prepared to take the risk

Social Networks: Source Credibility

the information seeker's perceptions of the source's expertise

Laggards

the very last consumer to adopt innovations. ugh-risk perceivers and the last ones to recognize the value of innovative products

Social Networks for utilitarian (everyday products)

very useful

Viral Marketing

virtual advertising

Non Adopters: Persistant non-adopters

who are very unlikely to become customers

Non Adopters: Prospective adopters

who could potentially become customers

Strategic Implications of Word of Mouth: E-WOM

word of mouth taking place online is E-WOM and it occurs in social networks, brand communities, blogs, chat room, and tweets