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UTA / Marketing / MARK 3324 / What is the household life cycle?

What is the household life cycle?

What is the household life cycle?

Description

School: University of Texas at Arlington
Department: Marketing
Course: Consumer Behavior
Professor: Adwait khare
Term: Spring 2016
Tags: Consumer Behavior, Marketing 3324, and Marketing
Cost: 50
Name: Study Guide- Test #2
Description: Straight from the book. Basically its like summaries of the chapters. Some of the notes are from class as well.
Uploaded: 03/06/2016
28 Pages 162 Views 4 Unlocks
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TEST #2 STUDY GUIDE


What is the household life cycle?



CH 6

∙ Households are important not only for their direct role in the  consumption process but also for critical role in socializing children o Purchasing and consumption patterns are among those attitudes  that are socialized

 Meaning that whatever is consumed as kids, people will be  inclined to continue buying habits

∙ Household- all the people who occupy a housing unit

∙ There are different types of households:  

o Family household- having at least two members related by birth,  marriage, or adoption, one is the householder

o Nonfamily household- householder living alone or exclusively  with others to who he or she is not related  


What are the two steps in the two step flow of communication?



∙ Traditional family household has been important focus for marketers  o Traditional family- a married opposite-sex couple and their own  or adopted children living at home We also discuss several other topics like What stage of piaget’s theory of cognitive development is associated with early childhood?

 This family has declined over time—today, only about 20%  are traditional families

∙ Step Families are also important and are growing

o Step Family- a married- couple family household with at least  one child under the age of 18 who is a step-child (i.e son or  daughter through marriage)

 Due to high divorce and remarriage rates  

∙ But there are many unmarried couples that see themselves as families  o 6.2 million unmarried-partners (opposite and same sex)  households in the US


Why is hemispheric lateralization important?



∙ Family life cycle is that most families pass through an orderly  progression of stages, each with its own characteristics, financial  situations and purchasing patterns

o Used to be simple—married by 20’s, had several children who  grew up and had their own families; the original couple retired  and the male would eventually die, followed after a few years by  the female

o Now it is more complex We also discuss several other topics like Who is athena?

∙ Researchers have developed several models of household life cycle  (HLC)

o Based on age marital status of the adult members of the  household and presence and age of children  

o HLC assumes that households move into a variety of relatively  distinct ad well defined categories over time  

o Each category in the household life cycle poses a set of problems that household decision makers must solve

∙ HLC stages:

o Single I- consists of young adults ages 18-34, unmarried. 68%  men and 60% women. Single I is basically the unmarried  members of the Generation Y’ers.

 Can be subdivided into those who live with or or both  parents and those who live alone or with other individuals  o Young Couples: No Children- Marriage is much more lively for the  25 to 34 year olds (50%) than it is under 25 crowd (14%).  Lifestyles altered by living together. Savings, household  furnishing, major appliances and more comprehensive insurance  coverage are among the new areas of problem recognition and  decision making

 Most have dual incomes  

o Full Nest I: Young married with children- Roughly 6% are married  with children. Addition of first child creates a significant change— wife may withdraw partly or fully from the labor force, the couple may have to move to a bigger place, choices of  If you want to learn more check out What are examples of polyatomic ions?

vacation/restaurants etc. will change.  

 Moms across the HLC possess 1.7 trillion in spending power o Single Parent I: young Single Parents- birth or adoption by singles is increasingly common. Roughly 40% of children are born to  unmarried mothers. 40% of these children may actually be born  to cohabiting unmarried parents  We also discuss several other topics like Is smoking marijuana in a city park in fort collins a deviant act?

 9% of American households are single-parent family

 younger members of tis group tend to have low incomes  and less education

o Middle-Aged Single- made up of people who have never married  and those who are divorced and have no child-rearing  

responsibilities. Are in the 35-64 age category which is primarily  the Gen X and baby boomers. Typically have higher incomes and  thus have more money to spend on their lifestyle and they are  willing to indulge themselves  

o Empty Nest I: Middle Aged Married with No Children- households  represent second marriages in which children from first marriage  are not living with the parent. Also includes married couples  whose children left. 55% of married couples in this age group  We also discuss several other topics like What is opsonization?

 Both will typically have jobs so they are very busy and  have plenty of money to spend on indulging themselves  o Delayed Full Nest I: Older Married with Young Children- Baby  Boomers and Gen X who waited to have their first child until their mid 30’s. Represent nearly 15% of all households and 71% of all  married couples with children under 18. MAJOR difference  between “delayed full nest I” and younger new parents is  income. Older new parents have significantly larger incomes. In We also discuss several other topics like What is griffith?

addition, delayed full nest I can also spend more on non child  expenditures such as food, alcohol and entertainment.

o Full Nest II: Middle-Aged with Children at Home- A major  difference between this group and delayed full nest I is age of  the children. The children of the full nest II are generally over age six and are becoming more independent. Greater demands for  space create a need for larger homes and cars. These factors,  coupled wit heavy demand for clothing and an increased need to  save for college, create a considerable financial burden on  housed holds in this stage.

o Single Parent II: Middle-Aged single with children at Home-Are in  the 35 to 64 who have children are often faced with serious  financial pressures. The children of this segment are given  extensive household responsibilities. Many in this position are  inclined to use time-saving alternatives such as ready to eat  food, and they are like to eat at fast food restaurants.  

o Empty Nest II: Older Married Couples- There are about 11million  household in this segment. Many Couples in the over 64 age  group are either fully or partially retired. The younger members  of this group are healthy and active and are usually financially  well off. They also spend considerable time and money on  grandchildren. A this stage and the next distribution of valued  family assets such as family heirlooms, property and money also  become important.

o Older Single- There are around 17 million older single in the  united states. About 70% all older single are female and roughly  two thirds live alone. Being older, single and generally retired  create unique needs for housing, socialization, travel and  recreation. Financial firms have set up special programs to work  with these individuals. A recent study labeled consumers who  were single as the result of the death of a souse as “single by  circumstance”. People who fall in such category are less  innovative, more risk averse, more price sensitive, and more  likely to engage in coping behaviors.  

∙ The HLC is an important segmentation tool given its relation to  differences in needs, wants, constraints, and consumption patterns  that are unique to each stage

∙ HLC/Occupational Category Matrix- the vertical axis is the stage in  the HLC, which determines the problems the household will likely face;  the horizontal axis is a set of occupational categories, which provide a  range of acceptable solutions

o Found to be useful across a range of products in segmenting the  market and developing appropriate marketing strategies  ∙ Research in the form of focus group interviews that is used to  determine the following information for each relevant cell

o What products/service are now being used to meet the need or  perform the activity?

o What, if any, symbolic or social meaning is associated with  meeting the need or use the current products?

o Exactly how are the current products or services being used? o How satisfied are the segment members with the current  solutions, and what improvements are desired?

∙ Attractive segments are those that are large enough to meet the firm’s objectives and have needs that current product is not satisfying ∙ Family Decision making- the process by which decisions that directly or indirectly involve two or more family members are made o Many family purchases are inherently emotional and affect the  relationships between the family members  

∙ There are 6 roles that occur in family decision making: o Initiator- the family member who first first recognizes a need or  starts the purchase process

o Information gatherer- individual who has expertise and interest  in a particular product

o Influencer- person who influences the alternatives evaluated, the criteria considered, and the final choice

o Decision maker- individual who makes the final decision o Purchaser- the family member who actually buys the product  (typically an adult or teenager)  

o User- The end user of the product (usually there are multiple) ∙ Family decision have been categorized as  

o husband-dominant, traditionally occurred with purchases of  products like cars, liquor and life insurance  

o wife-dominant, were more common in purchase of household  maintenance items, food and kitchen appliances

o joint, were most likely when buying a house, living room furniture and vacations

o individualized  

∙ how family members interact in a purchase decision is largely  dependent on the culture and subculture, the role specialization, the  degree of involvement each has in the product area, and the personal  characteristics of the family members  

∙ There are 6 basic approaches that individuals use to resolve purchase  conflicts after they have arisen

o Bargaining

o Impression management, misrepresenting the facts in order to  win

o Use of authority, claiming superior expertise  

o Reasoning, using logical argument to win

o Playing on emotion, using the silent treatment or withdrawing  from the discussion

o Additional information, getting additional data or third part  opinion

∙ Family provides the basic framework of consumer socialization o Consumer Socialization, is the process by which young people  acquire skills, knowledge and attitudes relevant to their  functioning as consumers in the marketing place

o Process refers to how children learn about consumption  ∙ Younger children have limited liabilities to process certain types of  information

∙ Piagets stages of cognitive development are widely accepted set  of stages of cognitive development for children

o Stage 1: The period of sensorimotor intelligence (0 to 2 years  old)- behavioral is primarily motor child does not yet “think”  though cognitive development is seen

o Stage 2: The period of preoperational thoughts (3 to 7 years old)- characterized by the development of language and rapid  conceptual development

o Stage 3: The period of concrete operations (8 to 11 years old)- the child’s cognitive structures reach their greatest level of  development and the child becomes able to apply logic to all  classes of problems

o Stage 4: The period of formal operations (12 to 15 years old)- the child’s cognitive structures reach their greatest level of  

development and the child becomes able to apple logic to all  classes of problems.

∙ The content of consumer learning can be broken down into 3  categories

o Consumer skills, those capabilities necessary for purchases to  occur such as understanding money. Budgeting product  evaluation etc.

o Consumption related preferences, the knowledge, attitudes and  values that cause people to attract differential evaluations to  products, brands, and retail outlets

 Parents may teach kids that Calvin Klein is a “prestigious”  brand and then later affects their buying patterns  

o Consumption related attitudes, cognitive and affective  orientations toward marketplace stimuli such as ads,  

salespeople, warranties etc.

 Parents teach kids that “you get what you pay for”, thus  assuming a strong price-quality relationship

∙ Parents these consumer learning both deliberately and casually ∙ Consumer socialization can happen in different ways like through  advertisements and friends

∙ Instrumental Training- occurs when a parent or sibling specifically and  directly attempts to bring about certain responses through reasoning  or reinforcement

o i.e a parent might try to directly teach their kid which snack  goods should be eaten by talking about nutrition

∙ Modeling, occurs when a child learns appropriate or inappropriate  consumption behavior by observing others

o Usually occurs without direct instruction  

o Children can learn both positive and negative consumption  patterns through modeling

∙ Mediation, occurs when a parent alters a child initial interpretation of  or response to a marketing or other stimulus

∙ Professor James McNeal developed a 5 stage model of how children  learn to ship by visiting supermarkets and other retail outlets with  parents

o Stage I: Observing- Starts at median age of two months. At this  stage children make sensory contact with the market place and  begin forming mental images of marketplace objects and  symbols. This stage ends when children understand that a visit  to the market may produce rewards beyond the stimulation  caused by the environment

o Stage II: Making Requests- Starts at the median age of 2.  Children begin requesting items in the store from their parents.  They use pointing and gesturing as well as statements to  indicate that they want an item. In the latter months of stage II  they begin to make requests for items at home, particularly when they are seen on television

o Stage III: Making Selections- Actually getting an item off the shelf without assistance is the first act of independence. Soon,  children will remember the store location and desired item.  

o Stage IV: Making assisted purchases- most children learn by  observing that money needs to be given in order to get things  from a store. Soon they are allowed to select and pay for items  with their own money. They are now Primary consumers (median  age of 5and a half years old)

o Stage V: Making Independent Purchases- Making a purchase  without a parent to oversee it requires a fairly sophisticated  understanding as well as the ability to visit the store. Most  children remain in stage IV for a long time (median age of 8) ∙ Marketing to children is full of ethical concerns  

o Concerns that advertisements may produce undesirable values  in children that result in inappropriate diets and unhealthy levels  of family conflict

 This is due to the limited information processing skills in  young children

∙ Only the older children could fully engage in the analogical reasoning  required to completely understand the ad

∙ Used to be that you would market to kids in Saturday morning cartoons but now there are more options

o i.e National Geographic Kids magazine, 4kidstv.com site  o Many firms target Kids Clubs but unfortunately these clubs can  sometimes engage in sales techniques that are controversial  

CH 7

∙ Group- two or more individuals who share a set of norms, values or  beliefs and their behaviors are independent

∙ Reference Group- whose presumed perspective or values are being  used by an individual as the basis of his/her current behavior o As situations change, we might base our behaviors on a different  group (which becomes a reference group)

∙ Groups may be classified to a number of variables. There are 4 criteria o Membership

o Strength of social ties

o type of contact

o attraction

∙ membership is dichotomous—either belong to the group or don’t ∙ strength of social tie refers to th closeness of group linkages o Primary Groups, include family and friends

o Secondary Groups, include professional and neighborhood  associations

∙ Type of contact refers to whether the interaction is direct or indirect o The internet is an example of indirect and has increased  ∙ Attraction refers to desirability that membership is a given group has o Dissociative reference groups have negative desirability   i.e teen avoiding clothes for older people

o Aspiration reference groups, are non-membership groups with a  positive attraction

∙ A consumption subculture, self-selects on the bases of a shared  commitment to a particular product class/brand

o Have an identifiable social structure  

o Set of shared beliefs/values

o Unique jargon, rituals etc.

 In other words, they are reference groups for there  

members

 Members vary in their commitment and interpretation ∙ These subculture adopt consumption patterns in large part to affirm  their unique identity

o Golfers and their shoes

∙ Marketer should use respected members of subcultures to identify  trends

∙ Consumption subcultures focus on the interactions of individuals  around an activity, product or brand

∙ Brand community- non-geographical bound community, base on  structured set of social relationship with owner of product and  psychological relationship with product itself

∙ Community- characterized by consciousness, shared rituals and  traditions

o i.e biking community cruisers like Harley

∙ Brand communities can add value to the ownership of the product and  build intense loyalty

o Derived personal and social benefits

∙ Online community- interacts over time around a topic of interest on the internet

o Extent of connection can vary dramatically

o Recent and ongoing evolution relations to online communities  involve online social network sites

∙ Online social network allows individuals to

o Construct a public or semipublic profile

o Articulate a list of other users with whom they share a  connection

o View and traverse their list of connections

 Marketers spend over 4 billion on ads

∙ They are attractive to markets because

o Consumer usage is high

o Majority of users, use to share information

o Customer acquisition potential seem high

o 2/3 of consumers that use social media are more likely to recall  brand

∙ First guiding principle in marketing online is to be “transparent” o Have to put out as much info as possible

∙ Reference group influence can take 3 forms:

o International influence- occurs when an individual uses  behaviors/opinions of reference group members as potentially  useful info

o Normative influence, (sometimes referred to as utilitarian) occurs wen an individual fulfills group expectations to gain direct reward o Identification influence (or value expressive), occurs when  individuals have internalized the groups values/norms

 No need for reference group

∙ Reference groups may or may not have influence

∙ There are some marketing strategies that can be employed based on  reference group influence  

∙ Personal sales strategies

o Asch phenomenon- pressure to conform with the majority ∙ Advertising strategies

o Marketers use all 3 types of reference groups influence when  developing ads

 Except normative is not used as much as it once was   Identification used by ads when a product is used by a  particular group

∙ We learn about new products and services from reference groups in 2  basic ways

o Observing or participating

o Word of mouth (WOM)

 Involves individuals sharing information with other  

individuals verbally  

 Not all sources equal in value  

∙ Opinion leaders- actively filter, interpret or provide product and  brand relevant information

∙ Two-Step flow of communication- process of one receiving  information to their family, friends and colleagues

o What usually happens is a multistep flow of communication ∙ Multistep flow of communication- involves opinion leaders for a  particular product area who actively seek relevant information from  mass media

∙ Exchange of advice and information between group members occur  directly or indirectly  

o Directly: through WOM

o Indirectly: through observation  

∙ Most notable characteristic of opinion leader is greater long-term  involvement with product category

o Referred to as enduring involvement, which can lead to  enhanced knowledge

∙ Opinion leadership functions primarily through interpersonal  communication and observation  

o Occur between people with similar demographic characteristics   i.e bloggers, youtubers etc.

∙ Market mavens- both initiate discussions about products and respond  to requests for market information

∙ Influentials are also similar to market mavens

o Represent about 10%of population and have broad social  networks that allow them to influence the attitude of the other  90%

o Can also be called e-fluentials (consists of adults)

∙ Some methods of marketers to generate WOM to influence opinion  leaders include  

o Stimulation- to encourage conversation on the brand o Sampling- also called “seeding” involves getting a sample of the  product into the heads of potential consumers  

∙ Advertising, product sampling, retailing/personal selling, creating buzz  are all ways to promote WOM  

o Buzz is defined as the exponential expansion of WOM  o Buzz is a key aspect of guerrilla marketing  

 Marketing with limited budget using nonconventional  communication strategy

∙ Innovation- is an idea, practice or product perceived to be new by  relevant individual/group

∙ Categories of Innovation:

o Continuous innovation, requires minor changes in behavior or  changes in unimportant to the consumer (i.e toothpaste) o Dynamically Continuous, requires moderate change in an  important behavior of low or moderate importance (i.e digital  camera)

o Discontinuous innovation, requires major changes in behavior of  significant importance to the individual/group (i.e becoming  vegetarian)

∙ Individual consumers go through a series of distinct steps—adoption  process

o Awareness, interest evaluation, trial, adoption

∙ The diffusion prices, is the manner in which innovations spread  throughout a market  

o Spread refers to purchase behavior in which he product is  purchased  

∙ For most innovations, the diffusion process follows a similar pattern o Start with slow growth, rapid and then slower

∙ Factors affecting the spread, rate at which innovation is diffused have  10 factors

o Type of group

o Type of decision

o Marketing effort

o Fulfillment of felt need

o Compatibility  

o Relative advantage

o Complexity

o Observability

o Trial ability

o Perceived risk  

∙ Researchers have divided the adopters of any innovation into 5 groups  o Innovators—25% i.e risk takers  

o Early adopters—13.5% i.e opinion leader

o Early majority—34% i.e more cautious

o Late majority—34% i.e skeptical

o Laggards—16% i.e locally oriented

∙ Earlier purchases of an innovation differ from later purchases marketer  should consider “moving target markets”

o i.e focusing on part of the target market most likely to be  innovators and early adopters

o as innovation gains acceptance, focus should shift o early and  late majority

∙ Diffusion enhancement strategies

o Critical part of the process is to analyze the innovation from the  target markets perspective

 Will indicate diffusion inhibitors (i.e obstacles)

CH 8

∙ Information processing is a series of activaties by which stimuli are  perceived, transformed into info and stored

∙ Has 4 stages:

o Exposure  

o Attention

o Interpretation

o Memory

∙ The first 3 of the stages make up perception

o Exposure occurs when a stimulus like a banner ad comes within  range of a person

o Interpretation is the assignment of meaning

o Memory is the short term use od the meaning for immediate  decision making

∙ These processes occur simultaneously and are interactive ∙ Perceptual defenses, also considered selectivity, means the individuals  are not passive recipients of marketing messages

∙ With exposure there is also selective exposure  

o Selective nature of consumers is a major concern for marketers ∙ Media exposure Is also a concern because people are more active to  avoid them

o Zipping, occurs when one fast forwards through commercial  o Zapping, involves switching the channels

o Muting, is turning the sound off during commercial break ∙ Product placement in entertainment media provides exposure that  consumers don’t try to avoid

∙ Movies and media are just some of the avenues being used; they also  use side of trucks, taxis, airplanes etc.

∙ Sometimes, however, consumers actively seek out marketing stimuli  which is known for voluntary exposure

o i.e superbowl commercials

∙ Infomercials tend to have a positive response

o infomercials are program-length television commercials with a  toll-free number and/or web address  

∙ Permission based marketing, is the voluntary and self selected nature  of such online offerings where consumers “opt in” to receive email  based promotions

o Also being used to enhance mobile marketing on cell phones ∙ Attention occurs when the stimulus activates on or more sensors and  occurs within the context of a stimulation

∙ Stimulus factors are physical characteristics of the stimulus itself  i.e ad size and color  

o The intensity of a stimulus (how loud, bright or length) can  increase attention.  

 One aspect of intensity is intrusiveness, or the degree that  one is force to see/ hear it

 Repetition is related to intensity

o Individuals are attracted to attractive visuals that are pleasant  stimuli

 The picture superiority effect on attention demonstrates  the importance of an ad’s visual component and suggests  why heavy use of pictures in contemporary print ads is  

justifies

o Color and movement serve to attract attention because they  are more noticeable

o Position refers to the placement of an object in physical space  and time  

 Position effects in advertising often depend on the medium and how consumers normally interact with the medium

o Isolation is separating stimulus object from other objects  The use of “white space”(placing a brief message in the  center of an otherwise blank ad) is based on this principle o Format refers to the manner in which the message is presented  Simple, straightforward presentations receive more  

attention than complex presentations

o Contrast is related to the ide of expectations and expectations  drive our perceptions of contrast

 Packaging, in-store displays that differ from our  

expectations tend to get noticed  

 Adaption level theory suggests that if a stimulus doesn’t  change, over time we adapt or habituate to it and begin to  notice it less

o What one is interested in is generally an individual characteristic

 In advertising, factors that increase curiosity, such as plot  the possibility of a surprise ending and uncertainty as to  the point of the message until the end can increase  

interest and attention

o Information Quantity represents the number of cues in the  stimulus field  

 Cues can relate to the features of the brand itself etc  Increases in information quantity in TV ads quickly lead to  information overload because consumers have no control  over the pace of exposure  

∙ Individual factors are characteristics that distinguish one individual  from another  

o Motivation is aa drive state created by consumer interests and  needs

 Product involvement indicated motivation or interest in a  specific product category

 Smart banners(type of behavioral targeting) are banner  ads that are activated based on terms used in search  

engines and are available for websites

o Ability refers to the capacity of individuals to attend to and  process information

 It is related to knowledge and familiarity with the product,  brand or promotion

 Study shows that more educated individuals pay more  attention to information given by pharmaceutical ads

 Brand familiarity is an ability factor related to attention.  Those with high brand familiarity may require less  

attention to the brands ads because of their high existing  knowledge

∙ Situational factors include stimuli in the environment other than the  focal stimulus and temporary characteristics of the individual that are  induced by the environment such as time pressures or crowded store

o Clutter represents the density of stimuli in the environment   Cluttering the environment with too many point-of

purchase displays decrease the attention consumers pay o Program involvement refers to how interested viewers are in the  program or editorial content surrounding the ads  

 Audience is attending to the medium because of the  program  

∙ Nonfocused attention is when stimuli is attended without deliberate or  conscious focusing of attention  

∙ Example is the cocktail effect, where an individual engaged in a  conversation with a friend isn’t consciously aware of other

conversations in a party until someone in another group says  something relevant like their name

o Hemispheric laterization is a term applied to activities that  take place on each side of the brain

 Left side of the brain Is primarily responsible for verbal  info, symbolic representation. Controls the ability of  

rational thought  

o Subliminal stimuli is a message presented so fast or softly that one is not aware of seeing or hearing it

 “hides” key persuasive information within an ad by making it so weak that it is difficult for an individual to physically  detect

∙ Interpretation is the assignment of meaning to sensations  o It is a relative process rather than absolute—perceptual relativity o Second aspect of interpretation is that it tends to be subjective  and open to a shost of psychological biases

 Subjective nature can be seen between semantic  

meaning(the conventional meaning) and psychological  

meaning (meaning of a word assigned by an individual)

o Final aspect of interpretation is that it can be a cognitive  “thinking” process or an affective “emotional” process

 Cognitive interpretation is a process where stimuli are  placed into existing categories of meaning (i.e early DVD  players thought to be the same as VCR’s—notion was due  to lack of experience)

 Affective interpretation is the emotional or feeling response triggers by a stimulus such as an ad

∙ Marketing stimuli have meaning only as individuals interpret them  based on needs, desires, experiences and expectations

o Inherent physiological and psychological traits influence how a  stimulus is interpreted  

 Some people experience emotions more strongly than  others, called affect intensity

o The meanings attached to such natural things as time, space,  relationships and colors are all learned and vary across cultures o Individuals interpretations of stimuli tend to be consistent with  their expectations, referred to as the expectation bias

 i.e in a taste test, 100% of students accepted dark brown  vanilla pudding as chocolate. This expectation was cued by color

∙ Situational context provides a context within which the focal  stimulus is interpreted

o Contextual cues, present in the situation play a role in consumer  interpretation independent of the actual stimulus

 Color can be a contextual cue (i.e color blue is more  

relaxing than red)

 Nature of programming can also be a contextual cue (i.e  coke doesn’t put advertisement is TV news because there  is bad news involved and doesn’t want to be associated  because they are an upbeat company)

∙ Stimulus is the basic entity to which an individual respond  ∙ Consumers respond and interpret to basic traits of stimulus such as  size shape and color

o A general trait is the extent to which the stimulus is unexpected,  referred to as incongruity

 As a consequence, products/ads that deviate somewhat  from established norms are often better liked  

 Rhetorical figures involve the use of an unexpected twist I  how a message is communicated either visually or verbally o Stimulus organization refers to the physical arrangement of the  stimulus objects

 Proximity refers to the fact that stimuli positioned close  together are perceived as belonging to the same category  Sometimes proximity results from relationship of the  stimulus to its context as in ambush marketing

 Ambush marketing involves any communication or activity  that implies or infer, that an organization is associated with an event (i.e advertise heavily during an event like  

basketball game)

 Closure involves presenting an incomplete stimulus with  the goal of getting consumers to complete it and thus  

become more engaged

 Figure-ground involves presenting the stimulus in such a  way that it Is perceived as the focal object to be attended  to and all other stimuli are perceived  

o In order to interpret stimulus change, consumers must be able to categorize and interpret the new stimulus relative to the old (i.e  interpreting change)

 Physiological ability of an individual to distinguish between  similar stimuli is called sensory discrimination

 The minimum amount that one brand can differ from  another with the difference still being noticed is called just  noticeable difference (j.n.d)

 The higher the initial level of an attribute, the greater that  attribute must be changed before the change will be  

noticed

 After noticing a change or difference, a consumer must  interpret it  

 Change is interpreted with respect to some reference state

∙ Interpretation often requires consumers to make inferences ∙ An inference goes beyond what is directly stated or presented  o Some inferences realted to product quality are relatively  consistent across consumers  

 Price-perceived quality is an inference based on the  

popular adage “you get what you pay for”

 Advertising intensity is also a quality signal. Consumers  infer that more heavily advertised brands are of higher  

quality

 Warranties are another wuaility signal, with longe  

warranties generally signaling higher quality

 Other quality cues include country of origin (COO)

o Consumer inference from visua images are beoming increasingly  important as advertisers increase their use of visual imagery o When data about an attribute are missing, consumers assign it a  value based on a presumed relationship between that attribute  and one for which data are available  

∙ Perception is critical implication for marketing strategy in different  ways

∙ Retail strategy, store interiors are designed with frequently purchased  items, separated so the consumer will travel more through the store  o Point of purchase displays also attract attention and boost sales  o Cross-promotions where signage in one area of the store  promotes complementary products in another can also be  effective  

∙ Brand name and logo development is also important

o Linguistic considerations- sometimes brand names have no  inherent meaning but slowly gain associations over time o Branding strategies- strategies are developed to leverage strong  existing brand names

 Brand extension- where an existing brand extends to a new category with the same name (i.e levi strauss putting its  name Levi on uscale mens suits)

 Co-branding- an alliance in which two brands are put  together on a single product  

o Logo design and typographic- how a product or service name is  presented (i.e logo) is also important

 Shapes and scripts is important

CH 9

∙ Learning is any change in the content or organization of long-term  memory or behavior

∙ Memory is the total accumulation of prior learning experiences  o Short term memory (or working memory) is the portion of total  memory that is currently used

o Long term memory is the part of total memory devoted to  permanent information

∙ Short term memory has limited capacity to store information and  sensations  

o Individuals use short term memory to hold information while they analyze and interpret it  

o They can then transfer it to another system like long term  memory

∙ The short lived nature of short term memory means that consumers  have to constantly refresh information through maintenance rehearsal  o Maintenance rehearsal is the continual repetition of information  in order to hold it in current memory for use of problem solving  or transfer to long term

∙ Short term memory is termed working memory because that is where  information is analyzed and interpreted  

∙ Short term is where elaborative activities take place

o Elaborative activates are the use of previously stored  

experiences, values, beliefs etc to interpret and evaluate  

information in working memory as well as to add previously  stored info

∙ Elaborative activates can involve both concepts and imagery o Concepts are abstractions of reality that capture the meaning of  an item in terms of other concept

o Imagery involves concrete sensory representations of ideas,  feelings and objects

∙ Key issue in learning and memory is the extent of elaboration o A major determinant is consumer involvement  

o Elaboration is enhanced when consumer are more involved in the brand and information will be transferred

∙ Long term memory is viewed as an unlimited, permanent storage ∙ Marketers are interested in semantic memory which is the basic  knowledge and feelings an individual has about concept

∙ Another type of memory of interest is episodic memory which is the  memory of sequence of events in which a person participated  o i.e personal memories like graduation, birthdays etc

∙ Flash bulb memory is a type of episodic memory  

o Flash bulb memory is acute memory of the circumstances  surrounding a surprising event. Key aspects include

 Vividly detailed

 Contain specific situational details about location etc

 Held with a high degree of confidence

 Perceived as special and different  

∙ Schema or schematic memory (sometimes called knowledge  structure) is a pattern of associations around a particular concept  o Schema can contain product characteristics, usage situations,  episodes, and affective reactions (i.e example what you  associate mountain dew with)

∙ Memory of how an action sequence should occur, such as purchasing  and drinking a soft drink to relieve thirst is a special type of schema  known as script

∙ The likelihood and ease with which information can be recalled from  long term is called accessibility

o i.e coca cola is the first brand that comes to mind when you think of sodas. Due to all of the ads

∙ Retrieval may involve explicit and implicit memories

o Explicit memory is characterized by the conscious recollection of  an exposure event

o Implicit memory involves the non-conscious retrieval of  previously encountered stimuli

∙ People learn things in different ways, could take a lot of involvement,  attention and processing

∙ High-involvement learning is one in which the consumer is motivated  to process or learn the material

o i.e individual reading PC magazine pror to purchasing a computer ∙ Low-involvement learning is one in which the consumer has little or  no motivation to process or learn the material  

∙ Level of involvement is the primary determinant of how material is  learned

∙ Conditioning is probably the morst appropriately described as a set of procedures tha marketers can use to increase the chances that an  association between two stimui is formed or learned

∙ There are two basic forms of conditioning

o Classical conditioning- attempts to create an association  between a stimulus and some response

 i.e popular music being paired with a particular brand, the  brand may elicit the same emotions the music does

o Operant conditioning- attempts to create an association between a response and some outcome that serves to reinforce the  response  

 Involves rewarding desireable behavior such as brand  purchases with positive outcome to reinforce the behavior  (i.e free samples)

 Shaping is the process of encouraging partial responses  leading to the final desired response  

∙ Cognitive learning encompasses all the mental acitivites of humans as  they work to solve problems or cope with situations

∙ 3 types of cognitive learning are very important

o Iconic rote learning- learning a concept or the association  between two or more concepts in the absence of conditioning   i.e someone sees an ad that says “ketoprofin is a headache remedy”, people will then association “ketoprofin” with  

“headache remedy”

o Vicarious learning or modeling- use of imagery to anticipate  the outcome of various courses of action

 Consumers don’t have to learn just through direct  

experience, they can also observe the outcomes of others  behaviors

 Modeling also occurs in low-involvement situations

o Analytical reasoning is the most complex of cognitive learning   One form of analytical reasoning is the use of analogy  Analogical reasoning is an inference process that allows  consumers to use an existing knowledge base to  

understand a new situation or object (allows consumers to  use knowledge with something they are familiar with)

∙ Stimulus discrimination or differentiation refers to the process of  learning to respond differently to similar but distinct stimuli o i.e the management of Bayer aspirin feels that consumers should not see its aspirin as being the same as other brands

∙ Stimulus generalization often referred to as the rub-off effect,  occurs when a response to one stimulus is elicited by a similar but  distinct stimulus

o so if a consumer who learns that nabisko’s Oreo cookies taste  good and therefore assume that the company’s new Oreo  chocolate cones will also taste good

∙ In conditioned learning, forgetting is often referred to as extinction ∙ In cognitive learning, forgetting is often referred to as retrieval  failure

∙ The stronger the original learning the more likely relevant information  will be retrieved when required

∙ Importance refers to the value that consumers place on the  information to be learned  

o Might be driven by the inherent interest of product or by the  need

∙ Importance is one dimension that separates high-involvement learning  situations from low-involvement situations

∙ When a consumer is not motivated to learn the material, processing  can be increased by causing the person to become involved with the  message itself

∙ Several issues regarding message involvement are important to  consider

o First, there is evidence that scent may be important to memory   Marketers developing tech for “scent emitting” through the internet

o Second, is the role of suspense  

 Sometimes marketers wait until the very end of a message to reveal the brand name in an attempt to attract interest  and attention

 It can be ineffective because it gives little time to  

consumers to integrate new information

o Final, regards message strategies that highlight a brands  personal relevance to the consumer  

 One strategy is self-referencing, which indicates that  consumers are relating brand information to themselves  ∙ Learning enhancement caused by a positive mood suggests the types  of programs that marketers attempting to encourage consumer  learning should advertise on

∙ Anything that increase the likelihood that a given response will be  repeated in the future is considered reinforcement  

o A positive reinforcement is a pleasant or desired consequence  o A negative reinforcement involves the removal or the avoidance  of an unpleasant consequence  

o Punishment is the opposite of reinforcement  

 It is any consequence that decreases the likelihood that a  given response will be repeated in the future  

∙ Repetition enhances learning and memory by increasing the  accessibility of information in memory or by strengthening the  associative linkages between concepts

o Effects of repletion depend on importance and reinforcement  o Both the number of times a message is repeated and the timing  of those repetitions affect the extent and duration of learning  and memory

o Any time it is important to produce widespread knowledge of the  product rapidly, as when introducing a new product, frequent  repetitions should be used, this is called pulsing

o Too much repetition however, can cause consumers to actively  shut out the message, evaluate negatively, or disregard it and  effect called advertising wear out

∙ Consumer can store (code) information in different ways  o Storing the same information in different ways (dual coding)  results in more internal pathways (associative links) for retrieving information

 An example of dual coding is when consumer learn  

information in two different contexts—a consumer sees two ads for the same brand of dandruff shampoo one with  

office theme and one with social theme. That different  

themes provides multiple paths to the brand and therefore  enhances recall later on  

o Echoic memory is the memory of sounds, including words o Learning and memory appear to be enhanced when the key  ideas communicated through one made are consistent with those communicated through other modes

∙ Sometimes consumers have difficulty retrieving a specific piece of  information because other relate information in memory gets in the  way, it is called memory interference  

o This is common due to competitive advertising

∙ One strategy is to avoid having your ad appear in the same set of ads  as your competitors  

o Another strategy called regency planning involves trying to plan  advertising exposures ao that they occur as close in time to a  consumer purchase as possible  

∙ Another strategy is to increase the strength of the initial learning  because stronger learning is less subject to memory interference  ∙ Reduce similarity to competing ads since ads that ads within the same  product has shown increase in interference

∙ Retrieval cues provide an external pathway to information that is  stored in memory  

∙ Retrieval is also affected by the similarity of the retrieval (response)  environment to the original learning environment and type of learning  ∙ Brand image refers to the schematic memory of a brand o It contains the target market interpretation of the products  attributes. Benefits, usage situations, users and so on

o Sometimes brand name may not trigger recall of prior ads,  example, seeing the brand on a store shelf may not be enough  for retrievable, so to remedy that there are other cues to ink the  brand like “Got Milk?” campaign

∙ Product positioning is a decision by a marketer to try to achieve a  defined brand image relative to competition within a market segment  o Product positioning has major impact on the long-term success of the brand, presuming the firm can create the desired position in  the minds of the consumers

∙ Perceptual mapping offers marketing managers a useful technique  for measuring and developing a products position

∙ Product repositioning refers to a deliberate decision to significantly  alter the way the market views a product

∙ Brand equity is the value consumers assign to a brand above and  beyond the functional characteristics of the product  

o Brand equity is synonymous with the reputation of the brand o based on the product position of the brand

∙ Brand leverage often termed family branding, brand extensions  or umbrella branding refers to marketers capitalizing on brand equity  by using an existing brand name for new products

∙ Successful brand leverage requires the the original brand have a  strong positive mage that the new product fit with the original product  on at leas one of the 4 dimensions

o Complement: two products used together

o Substitute: the new product can be used instead of the original  o Transfer: consumers see the new product as requiring the same  manufacturing skills as the original

o Image: the new product shares a key image component with the  original

CH 10

∙ Motivation is the reason for behavior

o A motive is a construct representing an unobservable inner force  that stimulate and compels a behavioral response and provides  specifc direction

∙ Maslow’s hierarchy of needs

o All human acquires a similar set of motives through genetic  endowment and social interaction

o Some motives are more basic or critical than other

o The more basic motives must be satisfied to a minimum level  before other motives are activated

o As the basic motives become satisfied, more advanced motives  come into play

∙ McGuire developed a classification system that organizes these various theories into 16 categories

∙ McGuire first divides motivation into four main categories using two  criteria

o Is the mode cognitive or affective?

 Cognitive motives focus on the persons need for being  adaptively oriented toward the environment and achieving  a sense of meaning

 Affective motive deal with the need to reach satisfying  feeling states and to obtain personal goals

o Is the motive focused on preservation of the status quo or growth  Preservation motives emphasize the individual as striving  to maintain equilibrium

 Growth  

∙ Need for consstency (active, internal), a basic desire to have all  facts of oneself consistent with each other  

o This includes attitudes, behaviors, opinions, self0images, views  of others and son on

∙ Cognitive Preservation motives include

∙ Need of attribution(active, external), this set of motives deals with our need to determine who is or what causes the things that happen to us and relates to an area of research called attribution theory

∙ Need to categorize (passive, internal), people have a need to  categorize and organize the vast array of information and experiences  they encounter ina meaningful yet manageable way so they establish  cateogirs or mental partitions to help them do so  

∙ Need for objectification (passive, external), these moyives reflect needs or observable cues or symbols that enable people to infer what  they feel and know  

o Impressions, feelings and attitudes are subtly estbalisheed by  vieweing ones own behavior and that of others

∙ Cogntive Growth motives include

∙ Needs for autonomy (active, internal), the need for independence  and individuality is a characteristic of the American cultures ∙ Need for stimulation (active, external) Affiliation refers to the  need to deelop mutually helpful and satisfying relationships with  others.

o Relates to altruism and seeking acceptance in interpersonal  relations

∙ Need for identification (passive, internal) need for identification  results in the consumer’s playing various roles  

o A person may play a role as student, sorority member, bookstore employee and so on

o Marketers encourage consumers to assume new roles (i.e  become a skateboarder)

∙ Need for modeling (passive, external) need for modeling reflects a tendency to base behavior on that of others

o modeling is a major means by which children learn to become  consumers

∙ Discovering purchase motive can easy or difficult

∙ Motives that are known and freely admitted are called manifest  motives

∙ Second group of motives are unknown to the consumer or were such  that he or she was reluctant to admit them, called latent motives ∙ Determining latent motives is more complex  

∙ Motivation research or projective technique are designed to provide  information on latent motives

∙ Beyond projective techniques, a popular tool for identifying motives is  laddering or constructing a means-end or benefit chain

o i.e ask a consumer over and over again what are the benefits  until they cant think of any more

∙ after isolating the motives, the next task is to design the marketing  strategy around the appropriate set of motives

∙ with many motives consumers have, there are frequent conflicts  between motives

∙ Approach-Approach Motivational Conflict, a person who must  choose between two attractive alternatives

o Can be resolved by a timely ad designed to encourage one or the other action

o Can also do price modification, i.e buy now, pay later ∙ Approach-avoidance motivational conflict, a consumer facing a  purchase choice with both positive and negative consequences  o i.e consumers who want a tan but don’t want to suffer the skin  damage

∙ Avoidance-Avoidance motivational conflict, a choice involving  only desirable outcomes  

o i.e consumers washing machine breaks but he doesn’t want to  pay for a new one or repair it or go without it

∙ Consumes are often strategic in terms of the behaviors they choose to  attain a desire outcome  

∙ Two prominent sets of motives are termed promotion and prevention

o Promotion-focused motives revolve around a desire for growth  and development and are related to consumers hopes and  aspirations  

o Prevention-focused motives revolve around a desire for safety  and security and are related to consumer’s sense of duties and  obligations

∙ Both prevention and promotion motives reside in each person  simultaneously  

o Due to childhood experiences, one or the other tends to  dominate in each person—this is known as chronic accessibility  ∙ The personality fo the consumer helps guide and further direct the  behaviors chosen to accomplish goals in different situations  o Personality is an individuals characteristic response tendencies  across similar situations  

∙ Most useful types of personality are called trait theories o Trait theories assume

 All individuals have internal characteristics or traits related  to action tendencies

 There are consistent and measurable differences between  individuals on those characteristics  

∙ Multi-trait personality theory identifies traits that in combination  capture a substantial portion of the personality of the individual ∙ Most commonly used multi-trait personality is the Five-Factor Model o This theory identifies five basic traits formed by genetics and  early learning  

 Extroversion  

 Instability

 Agreeableness

 Openness to experience

 Conscientiousness

∙ Single-trait theories emphasize one personality trait as being  particularly relevant to understanding a particular set of behaviors  o Consumer ethnocentrism reflects an individual difference in  consumer propensity to be biased against the purchase of  foreign products

 Consumers with low ethnocentrism tend to be more open  to cultures

o Need for cognition (NFC) reflects an individual difference in  consumer’s propensity to engage in and enjoy thinking  

 Those with high NFC engage in more effortful processing of persuasiveness communications, prefer verbal to visual  information

o Consumers need for uniqueness reflects an individual difference  in consumers propensity to pursue differentness relative to to  others through the acquisition and utilization of consumer goods

∙ Brand image is what people think od and feel when they ear or see a  brand name  

o Brand personality is a particular type of image that some  brands acquire

 a set of human characteristics that become associated with a bran  

∙ Brand personality can serve as a way to target specific market  segments  

∙ There are numerous elements to communicate brand personality  o Celebrity Endorsers

o User imagery

o Executional Factors

∙ Emotions are relatively uncontrolled feelings that affect behavior  o Some people are more emotional than others—called affect  intensity

∙ Three basic dimensions underlie all emotions—pleasure, arousal and  dominance (PAD)

∙ Gratitude in a consumer context is the emotional appreciation for  benefits received  

∙ Coping involves consumer thoughts and behaviors in reaction to  stress- inducing situation designed to reduce stress and achieve more  desired positive emotions  

o three broad types in response to negative emotions emanating  from stressful events such as bad customer service or product  failure

 Active coping- thinking of ways to solve the problem,  engaging in restraint to avoid rash behavior

 Expressive support seeking- venting emotions and seeking  emotional and problem focused assistance from others

 Avoidance- avoiding the retailer mentally or physically or  engaging in complete self denial  

∙ Consumer emotional intelligence- is a person’s ability to skillfully use  emotional information to achieve a desirable consumer outcome ∙ Emotions can play a variety of roles in advertising—emotional content  in ads enhances their attention, attraction and maintenance  capabilities  

∙ Emotional messages may be processed more thoroughly than neutral  messages

∙ Emotional ads that trigger a poostiively evaluated emotion will  enhance liking of the ad itself

∙ Repeated exposure to positive-emotion-eliciting ads may increase  brand preference through classical conditioning  

∙ Brand preference may also occur in direct, high-involvement way

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