COMM148MT

What are factors affecting behaviors of members of the buying center?

Organizational Influences - E.g. company's goals and its operating environment (recession, growth period, lawsuits pending, etc.), also the organization's finances, capital assets, market position, quality of HR, and country in which the firm operates. - Employees tend to adopt heuristics, which are decisions rules designed to reduce the number of viable options to a smaller, manageable set. - Satisficing is a frequently used decision rule = when an acceptable alternative has been identified, it is taken and the search ends. Individual Factors - 7 factors affect each member of the business buying center. Each factor affects how individuals interact with other members. - Personality Features + Personality features influence how a person performs buying-center roles. - Role and Perceived Roles + People's perception of how their roles fit into the buying center process and the organization influences the manner in which they become involved in a purchasing process. - Personal Objectives + Objectives can lead buyers to make purchases that help them politically in the organization, even when they are not the best choice. + Personal objectives in buying decisions can be tied to obtaining promotions, making rivals look bad, "brown-nosing" a boss, or the genuine desire to help the organization succeed. - Motivational Levels + A person's degree of motivation largely depends on the match between the individual's goals and the organization's objectives. + Need for recognition is a common motivator for many individuals. - Levels of Cognitive Involvement + Both consumer and business buying behaviors are influenced by levels of cognitive involvement. + Individuals with higher levels of cognitive capacity seek more information prior to making decisions. - Levels of Power + A person derives her level of power in the buying process from the role in the buying center, her official position in the organization, and the impact of the purchase decision on a specific job. + When a particular purchase decision directly affects an employee, she may try to gain more power through the buying process. - Attitudes Toward Risk + Oftentimes, vendors are chosen because buyers believe the choice poses the lowest risk. + Risk avoidance leads buyers to stay with current vendors rather than switching. + People believe that taking risks, especially when a failure occurs, affects performance appraisals, promotions, and other outcomes.

Be able to identify an example of standardization

McDonalds: "I'm lovin' it" global campaign. Attempt to strengthen the connection between McDonalds with its worldwide customers. More than just a new tag line. New way of thinking about and expressing brand appeal to consumers. Released one commercial in multiple languages, with the uniform message of "I'm lovin' it" in every country.

Understand the means-end theory.

Means-end theory suggests that an advertisement should contain a message, or means, that leads the consumer to a desired end state. These end states are personal values. - A means-end chain should start a process in which viewing the advertising message leads the consumer to believe that using the product will help achieve a personal value. The MECCAS (Means-End Conceptualization of Components for Advertising Strategy) model explains ways to move consumers from product attributes to personal values by highlighting the product's benefits. - Advertisers link the attributes of the product to specific benefits consumers derive. These benefits, in turn, lead to the attainment of a personal value.

Understand brand image and rejuvenating a brand image.

Brand image = summarizes what the company stands for, and how it is known in the marketplace. Role of Brand Image - Consumer Perspective: - Provides positive assurance - Unfamiliar settings - Little or no previous experience - Reduces search time - Provides psychological reinforcement - Provides social acceptance Role of Brand Image - Company Perspective: - Extension of feelings to new products - Ability to charge more - Consumer loyalty - More frequent purchases - Positive word-of-mouth - Greater channel power - Attracts higher quality employees - More favorable ratings Rejuvenating a Brand Image: Keys to Success 1. Help former customers rediscover the brand 2. Offer timeless consumer value 3. Stay true to original, but contemporize 4. Build a community

Describe brand parity.

Brand parity results when consumer believe that various brands provide the same set of attributes. Shoppers select from a group of brands rather than one specific brand. Quality becomes less of a concern because consumers perceive only minor differences between brands. Net effect = steady decline in brand loyalty.

What specific target audience information should be included in a creative brief?

Overly general target market profiles do not help. E.g. rather than specifying "males, ages 20 to 35," more specific information will be needed, such as "males, ages 20 to 35, college- educated, and professionals." Other information, including hobbies, interests, opinions, and lifestyles, make it possible to more precisely develop an advertisement.

Understand the categories of brand names, figure 2.6.

Overt = reveals what a company does (e.g. American Airlines). Implied = contains recognizable words or word parts that convey what a company does (e.g. FedEx). Conceptual = captures the essence of what a company offers (e.g. Krispy Kreme Doughnuts). Iconoclastic = represents something unique, different, and memorable (e.g. Monster).

Define private brands.

Private brands = proprietary brands marketed by an organization and normally distributed exclusively within the organization's outlets. - Low price, low quality products - Primary audience: price-sensitive/low-income consumers - Consumers see few differences between national brands and private brands

Identify the 4 P's of the marketing mix (note, distribution is also referred to as place).

Product Price Place Promotion

What is product positioning?

Product positioning summarizes the perception in the consumer's mind of the nature of a company or brand and its products relative to its competitors. Positioning created by factors: - e.g. product quality, price, distribution, image, marketing communications Positioning differentiates a product from the competition in the mind of the target audience.

Understand the concept of brand equity.

Brand equity = represents a set of characteristics that are unique to a brand. - Helps fight brand parity - Allows brand to be perceived better - Perception of brand equity means that consumers view a good or service's brand name as different, better, and one that can be trusted. - Brand equity dissuades consumers from looking for cheaper products, special deals, or other incentives. Brand Equity requires: 1. Brand awareness - Unaided recall - Recognition (aided recall) 2. Brand attributes & associations 3. Perceived quality 4. Brand loyalty - Only brand that customers purchase - Emotion - Value - Customer experience

What are the factors affecting time spent on an external search?

1. Ability to search - consists of a person's educational level combined with the specific knowledge he/she has about a product and the various brands in a specific category. - Moderate level = most likely to search. 2. Motivation - the greater the motivation, the more time spent on an external search. - Motivation is determined by the consumer's: level of involvement, need for cognition, and level of shopping enthusiasm. + Involvement summarizes the extent to which a stimulus or task is relevant to a consumer's existing needs, wants, or values. + The need for cognition personality characteristic identifies individuals who engage in and enjoy mental activities. People with high needs for cognition gather more information and search more thoroughly. + Enthusiasm for shopping - customers who enjoy shopping undertake more in-depth searches for goods and services. 3. Cost vs. Benefit - higher perceived benefits increase the inclination to search. - Cost of the search consists of: + Actual cost + Subjective cost (time spent, anxiety experienced) + Opportunity cost of foregoing other activities to search for information

List the characteristics of effective spokespersons, figure 6.13.

1. Attractiveness 2. Trustworthiness 3. Similarity 4. Expertise 5. Likability All characteristics contribute to credibility.

Identify the components of a creative brief.

1. Background/Problem - that can be solved by communication 2. Target audience - and key insights into their attitudes and behavior 3. Brand position - and other branding decisions, such as personality and image 4. Communication objectives - that specify the desired response to the message by the target audience 5. Proposition or selling idea - that will motivate the target to respond 6. Media considerations - about where and when the message should be delivered 7. Creative direction - that provides suggestions on how to stimulate the desired customer response

Identify the steps in the IMC planning process, figure 4.1.

1. Communications research 2. Target market 3. Product positioning 4. Objectives 5/6. Budget & IMC components

Describe the four ways consumers interact across multiple media formats, figure 1.6.

1. Content grazing = looking at 2 or more screens to access unrelated content (e.g. watch TV + text friend). 2. Investigative Spider Webbing = consumer investigates specific content across multiple platforms (e.g. watching football, access stats on phone). 3. Quantum Journey = focuses on completing a specific task (e.g. finding restaurant/reviews/maps on different platforms). 4. Social Spider Webbing = consumer shares content across multiple devices (e.g. posting on FB, texting friends to look at post).

Identify the steps in an integrated marketing communications plan, figure 1.4.

1. Current situational analysis 2. SWOT analysis 3. Marketing objectives 4. Target market 5. Marketing strategies 6. Marketing tactics 7. Implementation 8. Evaluation of performance

Models of the nature of the evaluation process

1. Evoked set = brands the individual considers in a purchasing situation. - Inept set - contains the brands that are part of a person's memory that are not considered because they elicit negative feelings - Inert set - holds the brands that the consumer is aware of, but the individual has neither negative nor positive feelings about them. - In other words, in most purchase situations a consumer only considers brands in her evoked set. - Placing a brand name in the evoked sets of consumers may be the primary goal of a marketing message. 2. Multi-attribute approach = useful for understanding high-involvement purchases. - Consumers' attitudes toward a brand is determined by: + The brand's performance on product or brand attributes + The importance of each attribute to the consumer 3. Affect referral = suggests that consumers choose brands with emotional connections. - Saves mental energy - Multi-attribute approach may have been used previously - Consumers often develop emotional bonds with brands

Understand the business-to-business buying process.

1. Identification of needs - like consumers, businesses also purchase based on needs. - Once a need has been recognized, the order will be placed with the current vendor in a straight rebuy situation. - When the purchase constitutes a modified rebuy or new task, members of the buying center move to the next step. 2. Establishment of Specifications - In a new task purchase, the most complete specifications are spelled out. Many times, various vendors assist the buyer in developing clear specifications. - In modified rebuy situations, managers examine specifications to ensure they are current and meet the company's needs. 3. Identification of Vendors - once specifications have been identified, potential vendors are located and asked to submit bids. 4. Vendor Evaluation - evaluation of vendors normally occurs at two levels: - Initial screening of proposals - narrows the field of vendors down to three to five competitors. - Vendor audit - audits are important if the company wants a long-term relationship with a supplier. 5. Vendor Selection - the selection criteria used include quality, delivery, performance history, warranties, facilities and capacity, geographic location, technical capability, and per-dollar value 6. Negotiation of Terms - In most purchasing situations, negotiation of terms will be a formality because the conditions have already been worked out. - Occasionally, however, changes are made at this point in a contract or purchase. 7. Post-purchase Evaluation - post-purchase phase represents a marketing opportunity. Vendors that provide high-quality products, make follow-up calls and offer additional services often move into a straight rebuy situation.

For a market segment to be viable, it should pass what tests?

1. Individuals or businesses within the market segment should be similar, or homogenous (i.e. same needs, attitudes, interests, opinions). 2. Market segment differs from the population as a whole. 3. Market segment must be large enough to be financially viable to target with a separate marketing campaign. 4. Market segment must be reachable through some type of media or marketing communications method.

What purposes do labels on packages serve?

1. Must meet legal requirements - identifying the product contained in the package and any other specific information about content, such as nutritional information on foods 2. Provides marketing opportunity - Labels may reveal special offers and other tie-ins (e.g. cereal box toy). Also often carry terms designed to build consumer interest and confidence (e.g. "natural," "premium," "industrial strength" make a product appear to be a better buy).

Understand the consumer decision-making process, figure 3.1.

1. Need recognition - Present status vs. preferred state. - Marketing helps consumers recognize imbalances between the two states. - Physical, social, psychological need recognition triggered by advertising. 2. Information search - Internal search - recall information in memory. + Consumer quickly reduces the number of potential brands. - External search - seek information in outside environment. + The amount of time a consumer spends on an external search depends on three factors: ability, motivation, and costs versus benefits. 3. Evaluation of alternatives - Analyze product attributes - Use cutoff criteria ("must-have") - Rank attributes by importance 4. Purchase decision - Factors that influence buying decisions include: + Cultural = values, language, myths, customs, etc. + Social = reference groups, opinion leaders, family members, etc. 5. Post-purchase evaluation - Consumers reduce dissonance by: + Seeking information that reinforces positive ideas about purchase + Avoiding information that contradicts + Revoking the original decision by returning the item

What are communications budgets based on?

1. Percentage of sales = allocations derived from either sales from the previous year or anticipated sales for the next year. 2. Meet the competition = companies raise or lower expenditures to match amounts spent by the competition. Seeks to prevent loss of market share. 3. "What we can afford" = sets the marketing allotment after all of the company's other budgets have been established or while determining other budgets. Company leaders allocate money based on what they feel can be spent. 4. Objective and task = marketers identify the communications objectives to pursue and then calculates the cost of accomplishing each objective. The communications budget becomes the cumulative sum of the estimated costs for all objectives. 5. Payout planning = management establishes a ratio of advertising to sales or market share. This method normally allocates greater amounts in early years to yield payouts in later years. 6. Quantitative models = computer simulations can be developed to model the relationship between advertising or promotional expenditures with sales and profits.

Understand the different approaches to positioning, figure 4.6.

1. Product Attributes - any product trait or characteristic that sets a brand apart from other brands may be considered an attribute. 2. Competitors - using competitors to establish position can be accomplished by contrasting the company's product against others. 3. Use or application - positioning that involves creating a memorable set of uses for a product emphasizes the use or application approach. 4. Price-quality relationship - businesses that offer products at the extremes of the price range may position by price-quality relationships. At the high end, quality becomes the emphasis. At the low end, price or value is emphasized. 5. Product user - another positioning strategy can distinguish the brand or product by specifying who might use it. 6. Product class - position may be based on product class. Occasionally, a company creates a new brand in a product class designed to stress superiority. 7. Cultural symbol - positioning a product as a cultural symbol will be difficult. When the company successfully achieves such a position, it can gain a strong competitive advantage.

Identify the three primary approaches used in communications research.

1. Product-specific research = identifying key product characteristics and benefits that become selling points. 2. Consumer-oriented research = assists marketers in identifying the context of a product's use. - Anthropological approach = direct observations of consumers using the good or service. - Sociological analysis of social class issues, trends, and family life cycle changes. - Psychological motives analysis for product purchases (e.g. feeling sexy, powerful, intelligent). 3. Target-market research = identifies those who will be the recipient of a communications campaign. - i.e. Looks at best market for a particular benefit of a good or service.

Understand the communications process model, figure 1.1.

1. Senders 2. Encoding 3. Transmission devices 4. Decoding 5. Receivers 6. Noise -Clutter

Understand types of Business-to-business sales, such as a straight rebuy.

1. Straight rebuy = occurs when the firm has previously chosen a vendor and places a reorder. - This routine process normally involves only one or a few members of the buying center. 2. Modified rebuy = buying team considers and evaluates alternatives. - Reasons to make a modified rebuy: + Dissatisfaction with current vendor + A different vendor makes an attractive offer + End of contractual arrangement with current vendor + Individuals involved in decision process have no or little experience with the product 3, New task buy = company considers a good or service for the first time or it has been a long time since the last purchase. Further, the product involved is one with which organizational members have no or extremely little experience. This type of purchase normally requires input from a number of buying center members.

Understand the impact of advertising expenditures, and the different effects.

A common concept was that a 10% increase in advertising would lead to a 1-2% increase in sales. The relationship between marketing expenditures and advertising has several factors: 1. The communications goal - the communications objective and stage in the hierarchy of effects model influence the advertising goal, budget, and message to be sent. 2. Threshold effects - what occurs when an advertising pro- gram begins to have a significant impact on consumer responses 3. Diminishing returns - a point at which a promotional campaign has saturated the market and further advertising and promotional expenditures adversely affect profits 4. Carryover effects - An instance in which an individual becomes ready to buy a product and remembers a key company due to the effectiveness of its marketing program. + Promotion for need-based products should be designed to create brand recall, which occurs when the consumer has been exposed to the company's message for so long that, when the time comes to buy, the individual remembers the brand name. 5. Wear-out effects - an instance in which consumers ignore or even develop negative attitudes toward a brand because the campaign has become "old" or "boring". + Some consumers may develop negative attitudes toward the brand if they become annoyed at the marketing communication and believe the advertisement should be discontinued. 6. Decay effects - what occurs when a company stops advertising and consumers begin to forget the message.

Familiarize yourself about trends in consumer buying, such as gender and age complexity.

Age Complexity - technology has led to children "growing up" at a much earlier age, and some adults refuse to grow old (e.g. driving sports cars, buying products that younger people buy). - Marketers try to create messages that reflect these behaviors but do not offend or confuse more traditional middle-aged people. Gender Complexity - refers to the manner in which the traditional roles, lifestyles, and interests of men and women have become blurred. - Marketers must adjust to less rigidly defined gender roles. Active, Busy Lifestyles - economic conditions and global competition have led many individuals to work longer hours in order to protect their jobs as corporations are forced to downsize. People tend to concentrate less on material possessions and more on experiences with friends and family. Time pressures also account for increases in sales of convenience items. Diverse Lifestyles - a wide diversity exists in the paths individuals take into adulthood, along with the living arrangements they create during that time. - E.g. second chancers - divorcees, usually between the ages of 40 and 59 and often have higher household incomes, entertainment and vacation services appeal to this group - E.g. LGBT community - digital ads may be especially effective with this group, because they have a higher than average ownership of smartphones. Communication Revolution - emerging technologies have altered the ways brands and firms are influenced by word-of-mouth communication. Social media offers pathways to engage in two-way communications with consumers. Experience Pursuits - recognizing that consumers often prefer experiences over things, companies provide customers with moments to remember rather than more items to put in their homes. Health Emphasis - many consumers try to develop a balanced lifestyle with an emphasis on nutrition, exercise, and staying active.

Identify the various forms or approaches from each message strategy category, figure 6.1.

Cognitive + Generic + Preemptive + Unique selling proposition + Hyperbole + Comparative Affective + Resonance + Emotional Conative

Understand marketing communication objectives.

Communication objectives tie the organization's context, target markets, and positioning approaches to the ultimate selection of budget figures and IMC components. Communications objectives are derived from overall marketing objectives, which tend to be general because they are for the entire company (e.g. sales volume, market share, profits, return on investment). Common communication objectives: + Develop brand awareness + Increase category demand + Change customer beliefs or attitudes + Enhance purchase actions + Encourage repeat purchases + Build customer traffic + Enhance firm image + Increase market share + Increase sales + Reinforce purchase decisions

Identify demographic and psychographic segmentation.

Demographic segmentation: - Age - Gender - Income - Ethnicity - Family Life Cycle Psychographic segmentation: - AIO Measures (activities, interests, and opinions) - VALS (Values and Lifestyles) = categorizes consumers into 8 different groups based on resources and action orientation: 1. Innovators 2. Thinkers 3. Achievers 4. Experiencers 5. Believers 6. Strivers 7. Makers 8. Survivors

Understand derived demand.

Derived demand = creates many business needs and is based on, linked to, or generated by the production and sale of some other good or service. E.g. the demand for steel is linked to the annual sales of automobiles. When the demand for vehicles goes down, the demand for steel also declines.

Understand dual channel marketing.

Dual Channel Marketing = selling virtually the same goods or services to both consumers and businesses. - Most common scenario occurs when a product sold in business markets is then adapted to consumer markets. - Spin-Off Sales = occurs when individuals who buy a particular brand at work enjoy positive experiences, and, as a result, purchase the same brand for personal use. Dual Channel Marketing Strategies: - Use different communication messages - Create different brands - Use multiple or different channels

Describe an evoked set

Evoked set = brands the individual considers in a purchasing situation. - Inept set - contains the brands that are part of a person's memory that are not considered because they elicit negative feelings. - Inert set - holds the brands that the consumer is aware of, but the individual has neither negative nor positive feelings about them. - In other words, in most purchase situations a consumer only considers brands in her evoked set. - Placing a brand name in the evoked sets of consumers may be the primary goal of a marketing message.

Define an executional framework and identify the different types.

Executional framework = signifies the manner in which an ad appeal will be presented and a message strategy conveyed. Types of Executional Frameworks: + Animation + Slice-of-life + Storytelling + Testimonial + Authoritative + Demonstration + Fantasy + Informative

Understand types of brands, figure 2.11.

Family Brands = company offers multiple products under one brand name - E.g. Campbell - soup & other vegetable products. - Transfer associations = consumers expect products from the same brand to uphold similar levels in quality, occurs as long as the new product remains within the same product category. Brand Extension = use of an established brand name on new goods or services (expands brand meaning). - Extension might not be related to the core brand. - E.g. Nike extended brand name to a line of clothing. Flanker Brand = new brand by a company in a good or service category in which it currently has a brand offering. - E.g. P&G's laundry detergents - Flanker brands appeal to target markets a brand does not reach + Helps the company offer a more complete line of products, reaches higher percentage of customers. + Establishes barriers to entry for competing firms.

Understand the concept of brand parity in the business-to-business sector.

In business-to-business marketing, a visible global brand presence is equally crucial. The existence of multiple vendors, increasing perceptions of brand parity, and growing use of the internet make it impossible for a company to succeed using only price differentiation. To combat such situations, a strong brand is a necessity in the global environment. Brand equity increases the chances of being selected.

Be able to identify examples of flighting, continuous, and pulsating schedules

Pulsating schedule = involves continuous advertising and communications during the year with bursts of higher intensity at specific times (more ads in more media). Flighting schedule = communications are presented only during peak times and not at all during other times of the year. Continuous schedule = spending in level amounts, keeping the brand repetitively in front of consumers.

Understand the concepts of severity and vulnerability in a fear appeal.

Severity = the part of the fear behavioral response model that leads the individual to consider how strong certain negative consequences of an action will be. + (i.e. level of consequence) Vulnerability = the part of the fear behavioral response model that leads the individual to consider the odds of being affected by the negative consequences of an action + (i.e. probability of event occuring)

In terms of marketing communications and international implications, what is standardization?

Standardization = one strategy marketers can employ for global companies. Involves companies featuring a uniform product and message across countries. The approach involves generating economies of scale in production while creating a global product using a more universal promotional theme. The language may be different, but the basic marketing message stays the same.

Understand stimulus codability

Stimulus codability = process of successful logos eliciting shared meaning among consumers. Logos with high stimulus codability evoke consensual meanings within a culture or subculture. Consumers readily recognize logos with high degrees of codability, e.g. Apple, McDonalds, & Pepsi. Companies that have logos with lower degrees of codability often spend more money on advertising. - E.g. Nike Swoosh before it became recognized.

Identify tangible and intangible elements of brand image, figure 2.1

Tangible Elements: - Goods or services sold - Retail outlets where the product is sold - Advertising - Marketing communications - Name and logo - Packaging and labels - Employees Intangible Elements - Corporate personnel (ideas, beliefs, conduct) - Environmental policies - Corporate culture - Country location - Media reports

Understand the role of the buying center.

The buying center = the group of individuals making a purchase decision on behalf of a business. The buying center complicates buying decisions. It consists of 5 roles: 1. Users = members of the organization who actually use the good or service 2. Buyers = individuals given the formal responsibility of making the purchase 3. Influencers = individual, e.g. engineers, who shape purchasing decisions by providing the information or criteria utilized in evaluating alternatives 4. Deciders = individuals who authorize the purchase decisions 5. Gatekeepers = individuals who control the flow of information to members of the buying center Roles often overlap, and several individuals can occupy the same role in a buying center, especially for large purchases.

Understand the hierarchy of effects model, figure 5.1.

The hierarchy of effects model helps to clarify the objectives of an advertisement campaign. 1. Awareness 2. Knowledge 3. Liking 4. Preference 5. Conviction 6. Purchase 1, 2 - Cognitive 3, 4, 5 - Affective 6 - Conative The hierarchy of effects approach enjoys the benefit of allowing marketers to identify common steps consumers and businesses take when making purchases. Building brand loyalty requires all six steps.

Understand the attitude formation sequences which match the hierarchy of effects model steps.

The most common sequence that takes place when an attitude forms is: - Cognitive → Affective → Conative Cognitive-oriented ads work best for achieving brand awareness and brand knowledge. Affective-oriented advertisements are better at inspiring liking, preference, and conviction. Conative ads are normally best suited to facilitating product purchases or other buyer actions.

Why is the post-purchase phase critical in the business-to-business arena?

The post-purchase phase represents a marketing opportunity. Vendors who have performed at a high quality often move into a straight rebuy situation. + They become the chosen vendor and avoid going through the entire process again - unless something changes. Even for products purchased occasionally, vendors try to produce quality in hopes that the client company returns the next time they make a purchase.

Define message strategy.

The primary tactic or approach used to deliver a message theme.

Define crowdsourcing.

The process of outsourcing the creative aspect of an advertisement to the public.

Identify types of appeals that can be used in designing ads.

Types of Appeals: + Fear + Humor + Sex + Music + Rationality + Emotions + Scarcity