Consumer Behavior How does psychology and behavior impact promotions?

Consumer Behavior

How does psychology and behavior impact

promotions?

The Communication Process

• Source• Communication objective• Message• Message channel• Target Audience• Communication Outcome• Feedback• Noise

Communication Process in Advertising and Promotion

• Source – advertising (retailer, manufacturer); PR (newspaper reporter, competition, manufacturer, retailer)

• Communication Objectives (awareness, influence behavior, recall)

• Message (via advertisements, POP display)

Communication Process in Advertising and Promotion

• Message Channels – (media, salesperson)

• Communication Outcome – Brand Awareness, Attitude change, brand associations, trial

• Receiver – Target Audience

• NOISE – interferes and interrupts the communications process

Who Are Consumers?

• People who buy products

• People who use products

• Example: Mom buys the cereal but the kids consume and influence decision

Major Influences on Consumers

• External Influences– Culture

– Social Class

– Reference Groups

– Family

• Personal Influences– Age

– Sex

– Family Status

– Occupation

• Psychological Influences– Attitudes

– Perception

– Needs

Culture• Complex of tangible

items such as art, literature, clothing, music and intangibles such as law, values, customs that define a group of people and their way of life.

Social Class

• Position that you and you family occupy within society

• Determined by:– income

– occupation

– wealth

– family prestige

– value of home

Reference Groups• Collection of people

that you use as a guide for behavior in specific situations.

• 3 Functions– provide information

– means of comparison

– furnish guidance

Family• 2 or more people living in a house related

by blood, marriage, or adoption

• Provides economic, financial and emotional support

• Determines Lifestyle

Personal Influences

• Age• Gender• Family Status• Education• Occupation • Income• Race and Ethnicity

Perception

• The process by which an individual receives, selects, organizes and interprets information to create a meaningful picture of the world.

• Individualized process where information is filtered and screened for interpretation

Selective Exposure• Consumers choose

whether or not to make themselves available to information.– Example: in the

Golden Age of TV networks ads could reach 70% of audience

Selective Attention

• Consumer chooses to focus attention on certain stimuli while excluding others.– Example: average

consumer exposed to 3,000 – 20,000 promotional messages a day

Selective Comprehension

• Consumers tend to interpret information in a manner that will support their own, attitudes, beliefs, motives, and experiences.

Selective Retention

• Final screening process.

• Consumers do not remember all that they see, hear, or read even after attending and comprehending it.

Psychological Influences

• Elaboration Likelihood Model– Attitudes– Behavioral

Intentions– Involvement

• Needs – Maslow’s Hierarchy of Needs

Attitudes

• learned predisposition to think in a certain way about a person, product, service or idea

• based on:– personal factors -social class– cultural factors -race– educational factors– familial roots– religious factors

Elaboration Likelihood Model

• model that allows marketers to predict routes to persuasion

• route to persuasion based on two moderating variables:– motivation (involvement)– ability to comprehend

• central and peripheral routes are the ends of an elaboration continuum

ELM• Elaboration

– amount of issue relevant thinking done by the consumer

• Involvement– personal motivation

to “think”

– reflects risk and how close the issue ties to the ego

Peripheral Route

• Affective Route - Zajonc

• reflects lower levels of involvement or lack of ability to process

• outcome is attitude toward the ad

• attitudes less resistant or persistent than those formed centrally

• relies on cues such as sex, celebrities, music color, visuals to persuade

Peripheral Route

• Most effective forms of advertising will be:– tv

– radio

– celebrity endorsers

– mood oriented print ads

– sex

Hedonic Needs

• Attend to messages that make us feel good.

• Hedonic Consumption– stimulus cues

consumption of memories

• I.e., perfume and an old girlfriend

Central Route

• high levels of involvement• higher levels of ability to process• may reflect a natural desire to be cognitive• cognitive route to persuasion• outcome is an attitude toward the brand• attitudes formed centrally are more

resistant and persistent

Central Route

• reflected by the Fishbein Model of Attitude Formation

• best forms of advertising– print

– cognitive

– product information provided

Fishbein Model Attitude Changes

• Change a belief– Very difficult to change an initial negative

impression

• Change the Importance of the Evaluative Criteria

• Add a new BiEi Combination– BEST! Improves your position and hurts

everyone else!

Multi-Stage Memory Theory

• Sensory Memory– Physical Property Analysis

• Short Term Memory– Assign some meaning to the new input

– Combines with long-term stores

• Long-term Memory– Unlimited memory store

Techniques to Enhance Memorability

• Repetition– Frequency

• Jingles

• Slogans

• Taglines

• Logos

Maslow’s Hierarchy of Needs

• Motivation - internal force that stimulates the person to act in a certain manner.

• Needs- the basis of motivated behavior

Maslow’s Hierarchy

• Self-Actualization - Fulfillment

• Ego Needs - success, achievement

• Social Needs - affection, friendship

• Safety and Security Needs - protection, order, stabilization

• Physiological Needs - food, water, shelter, sex