BUSS505 Lecture Notes PDF

Preview

Summary

Week 2 - PerceptionPerception: the process where an individual becomes aware of the environment through exposure to stimuli, and interprets it in a way that fits with their own frame of reference Perceptual Defence = to avoid or distort information to protect from perceived risk or perceptual overl...

Description

Week 2 - Perception Perception: the process where an individual becomes aware of the environment through exposure to stimuli, and interprets it in a way that fits with their own frame of reference  Perceptual Defence = to avoid or distort information to protect from perceived risk or perceptual overload, information that we think is important not to see  Selective Perception = perceiving marketing stimuli to reinforce our frame of reference of what is important and relevant for us, therefore anyone could perceive the same information differently We have a heightened awareness of marketing that will meet our needs and a depressed awareness of irrelevant information eg. refusing to believe or listen to information that contradicts what we already believe  Frame of Reference = all past experiences, feelings, expectations, motives, attitudes etc.  Perceptual Blocking = consumers protect themselves from being bombarded by stimulus by intentionally not paying attention eg. muting ads on TV, scrolling past ads on FB  Subliminal Perception = perceiving stimuli that you are not aware you are being exposed to, below your level of conscious awareness The Perceptual Process: Exposure (physical contact through senses), Attention (noticing and focusing on the stimuli) & Comprehension (understanding the stimuli by relating it to existing knowledge) Factors of Perception: The Situation (how other people are reacting, the social setting) , The Perceiver (frame of reference), The Target (the marketing strategies involved) Trade Dress = the packaging or look of a product that strongly associates with a brand exclusively Contagion = a psychological spreading of certain thoughts or actions, that can be brought via rumours or suggestions

Sensory Marketing: 1. Vision = attracts and maintains attention eg. Colour - reactions to colour are biological and learned, it becomes associated with specific companies and feelings eg. Size - the bigger the plate the more we eat, we focus on the height of a glass more than the width

2. Smell = relates to a mood or memory 3. Hearing = sound affects feeling and behaviours eg. the pace of music in store for fast purchases or slow relaxed experiences, how a brand name sounds aloud, certain letters sound less intense or sophisticated 4. Taste = changes with consumers changing palates and cultural changes on desirable tastes 5. Touch = product experience and judgement through feel

Week 3 – Learning and Memory Internal Stimulus = from inside your body eg. hunger pains, emotion, full bladder External Stimulus = outside the body eg. flashing lights, scary or sad events Learning: the process by which an individual obtains purchase and consumption knowledge and applies this to future behaviour Intentionally learning information for a specific subject

VS.

Unintentionally learning through sense and reaction to the environment

Elements of Consumer Learning: with the aim to stimulate learning in consumers

Motivation: to learn stems from information that is relevant to consumer needs and goals

Cues: used to direct consumers towards purchasing by influencing the consumer to respond to motives

needs, wants, drives, and desires of an individual lead toward the purchase of products

Logos / Branding / Packaging

Physiological (hunger, body related) Psychological (make you feel

Quality vs. Price = the cue that more expensive products are of higher quality,

different/better) or environmental (introduction of a new product, trends, conformity)

even though this is not necessarily true

Arousal Motives = physiological, emotional, cognitive or environmental elements that make you notice certain stimuli eg. if the weather becomes cold, you will be more interested in advertising relating to warm clothing Behaviour: how consumers react to a cue

Reinforcement: increasing the likelihood of a response to occur again in the future

learning takes place even if a purchase is not made over time a particular image of the brand or product is solidified

the reward that a consumer feels after buying and using a product reinforces future purchases

Learning Theories: Behaviour Learning: results from exposure to stimulus, observing behaviours that you then take on Cognitive Learning: learning through problem solving to gain control over the environment, conscious learning,  based on an individual’s cognitive ability  emphasises the role of motivation and mental processes (thoughts and decisions) in producing a desired result  the ability to form mental images differs between consumers, therefore the ability to recall information is also different Classical Conditioning

Instrumental/Operant Conditioning

The Structure of Memory: Sensory = remains in the mind’s sensory store for 1-2 seconds

Short-Term = real memory where information passes through the attention gate and held for 2-10 seconds

Long-Term = information is processed, considered and retained for extended periods of time

associating specific consequences with

combining two stimuli to create a new

behaviour through trial and error & reward and punishment to stimulate decision making eg. product sampling, experiences of bad

behavioural effect eg. pairing food and a bell together to teach

quality vs good quality

a dog that a bell signals food teaching behaviours through repetition,

an individual learns to perform behaviours

creates an automatic response, the more repetition the stronger the association

that produce positive outcomes and avoid behaviours that produce negative outcomes

becomes and slows the pace of forgetting common in low-involvement situations eg. things that require less energy, time, care and thought input too much repetition can make people bored and uninterested, retention then declines different marketing campaigns are used to avoid advertising wear-out

Stimulus Generalisation = having a similar response to different stimuli Note: Emotion is more effective than logic in advertising The Process of Memory: Cognitive Learning the process of getting information into  memory by storing short-term memory into long-term

Retrieval

Rehearsal

being able to recall the information from memory, with consumers typically

mental repetition of information helps to solidify information in



remembering a product’s benefits rather than actual

both short and long-term memory which aids in

features

retrieval

Week 4 – Attitudes

Attitudes: learned predispositions in response to people, subjects/issues, the environment, brands etc. in a consistently favourable or unfavourable way  attitudes differ in intensity  can have positive, negative, neutral, and both positive and negative attitudes at the same time Activation of the Attitude:  activated by being consciously aware of a memory  through exposure to the object, especially if the attitude was originally formed through direct experience with the object  the more accessible the attitude, the greater its influence on categorising and judging objects and likelihood of guiding future behaviour Influence:  relatives and friends  personal values  attention  interpretation and perception  memory

Functional Theory of Attitudes: Utilitarian considers both positive and negative outcomes associated with an object to guide behaviour that obtains or avoids

Value-Expressive allows consumers to express their core values, beliefs, and self-concept (note)

certain outcomes Eco-Defensive using attitudes as a defence mechanism,

Knowledge allows consumers to simplify decision

associating self with things that are going well and disassociation with things that are

making, organise new information and create generalisations

going bad eg. disliking sport because you are bad at it Note: Actual Self = how a person perceives themselves and the attributes they think they possess

Ideal Self = how a person would like to perceive themselves and the person they want to be Attitude Components: Cognitive (beliefs/thinking): a consumer can hold both positive and negative beliefs towards an object, it is not often one or the other, some beliefs may be neutral, can differ depending on circumstances and some beliefs may not be true eg. coffee is good on a cold day – but not on a hot day eg. Cadbury is a respected brand – but they use palm oil Affect (feelings): not all feelings stem from beliefs, independent feelings may contradict beliefs eg. an extreme environmentalist still having a Christmas tree due to the happy feelings associated with the holiday Behavioural Intention: what the consumer will do with the object, buy or not buy based on beliefs and feelings, although the behaviour may be reflective of other circumstances eg. going somewhere with friends because they want to Attitude-Behaviour Consistency: factors that create inconsistency  Ability = being unable to perform the behaviour eg. lack of money to buy the car brand you think is the best  Motive = the need for the object outweighs the contradicting attitude (low-intensity of feelings or beliefs)

 Competing Demand for Resources = scarcity, trade-off for having to make decisions  Social Influence = influence of friends and surroundings on accepted behaviour  Measurement Problems = difficulty in accurately measuring all components and prioritising them Note: Cognitive Dissonance = inconsistency between attitude components, when one contradicts another Elaboration Likelihood Model (ELM): when people are more likely to be influenced by either the messages content or the superficial aspects surrounding the message

Central Route

Peripheral Route

deep processing focused on the quality

superficial processing, focused on

of the message arguments

surface features only, usually the communicators attractiveness

consumers are motivated and have a desire to pay attention

Advertising Appeals: fear, sex, humour, act on emotions rather than rationale  Message appeal creates mental shortcuts for consumers to make decisions  Source effects such as credibility, attractiveness, likability, and meaningfulness help to define the person/brand advertising the message, and therefore create mental shortcuts to make decisions harnessing pre-existing attitudes Attitude Change: the marketing strategies used to change consumer attitudes  Cognitive (learning): change of current beliefs and their importance, support and strengthen arguments of positive aspects and refute negative claims, draw conclusions for consumers on what they should believe or let them evaluate the evidence themselves, use of two-sided appeals offering a negative and positive aspect where the ‘but’ is emphasised  Affect (feelings): use of classical conditioning, attractiveness of the marketing campaign rather than the product itself, use of the mere-exposure effect which relates increased exposure to increased likeability of the product, even if no beliefs or feelings are formed  Behaviour: operant conditioning, marketers use consumer rationale to change

behaviour based on lower prices and convenience, change in beliefs and feelings also has effect on change in behaviour

Week 5 – Decision Making Process: a decision is the selection of an action from two or more alternatives (including whether to make the decision and which brand) Need Recognition Tension is created by the difference between consumer’s actual state and desired state A significant difference between states cause consumers to recognise the need or problem Affected by: internal stimuli, external stimuli, marketers Search  Internal Search: first step to information gathering, based on memory and personal experiences  External Search: the next step if internal search failed to resolve the problem completely, pre-purchase research from sources – personal, friends, family – independent, consumer groups – marketing, advertising, websites, staff – experiential, trial and inspection  Factors that increase pre-purchase search: Product – long time since last purchase, high price, range of choices, Situational – first time purchase, purchasing a gift, Personal – welleducated, open-minded, under 35 age group Alternative Evaluation 1. Evoked/Consideration Set – list of brands they will make their decision from 2. Criteria – used to evaluate each brand based on the perceived importance of product attributes eg. price, brand name, country of origin Purchase Decision 1. Trial Purchases – first time purchase of product, evaluates brand 2. Repeat Purchases – consumer has found the product satisfactory and repurchases 3. Long-term Commitment Purchases – purchase of durable goods where a trial purchase is not possible seg. fridge, washing machine Post-Purchase Evaluation Evaluating how the product performed based on your expectations: Exceeds Expectations = Satisfaction Meets Expectations = Neutral Feeling Below Expectations = Dissatisfaction Cognitive Dissonance = consumers doubts after purchase on if the decision was correct

Situational Influence

Psychological Influence

Social Influence

physical and social

perceptions

family

surroundings time purchase reason

motives personality self-image

reference groups opinion leaders culture

mood

class

Heuristics in Decision Making: efficient rules that people use to form judgements and make decisions quickly  Low-Involvement Rules “better” = preferred brand, larger size / unit quantity, price (comparing previous purchase, competitors, anchors)  Present Bias = the value/reward of having something now rather than waiting  Anchoring = influence from the first information consumers are exposed to eg. expensive menu item makes other options seem more affordable, sale price was $500 now $100  Sunk-Cost Effect = invested money influences decision eg. continuing to watch a bad movie because you have paid for it  Confirmation Bias = searching for information that confirms what we already believe  Halo Effect = recognition of one characteristic that translates to the same attitude for the entirety  Representativeness = estimation of the likelihood an event will happen based on existing ideas we already have  Availability = deciding based on the information you already have, examples that first come to mind eg. recency – the example that happened the most recently – President = Trump eg. vividness – the most prominent memory/example – Ocean Dangers = Sharks  Loss Aversion = making a decision that avoids loss, more influenced by impact of loss than gain

Week 6 – Social and Cultural Influence Heuristics in Advertising: capitalising on social and cultural influences and how they increase the effectiveness of a marketing strategy  Likeability = using a characteristic that is likeable in general  Cognitive biases = simplifying information to make the choice easier, relying on previously learnt decision making short-cuts  Surprise effect = when the ending of an advert is unexpected  Availability = leads to familiarity

 Affect = use of emotions in adverts, feelings then become thoughts  Bandwagon Effect = do, believe or say something because other people are  Sender Effect = trust in the sender or sharer of the information Personal Influence:  Opinion Leader = a person who informally influences the attitudes and actions of others, commonly through use of social media power (mass connecters), can be noncommercial, can be brand advocates or brand detractors  Word of Mouth = the opinions of people you know and trust are more influential than a sales person or a paid advertisement, information can be received from friendship groups, brand communities or virtual groups about existing and new products Reference Groups: membership groups (common interests), aspiration groups (people an individual aspires to be like or belong to), dissociative groups (inconsistent with an individual’s beliefs and therefore avoidance of these attitudes and behaviours)

 Socialisation = determining what is acceptable and acting accordingly  Self-Concept = protect and modify true self to align with others in the group  Social Comparison = basing personal behaviours on how we compare to others, as well as the desire to be better than others  Conformity = a change in beliefs or actions based on real or perceived group pressures Social Influence: a change in an individual’s behaviours, thought feelings, attitudes etc, as a result of interacting with others  Herding = the instinct to follow others  Majority = when a large proportion of people in a reference group hold an opinion, it is likely the individual with also adopt this opinion  Conformity = through: Internalisation – genuinely believe and accept group norms, Identification – change of public behaviour in presence of the reference group, Compliance – going along with the norm to avoid consequences, Informational – believe the information the reference group provides is accurate, Normative – we want the reference group to like and accept us  Social Loafing = a person typically exerts less effort when working in a group than if completing the task alone  Obedience = yielding to instructions or orders from an authority figure 6 Processes of Influence:

Reciprocation the feeling of obligation to

Authority trust in people in a

Commitment & Consistency the desire to act

Scarcity limited availability

Liking the more we like someone the

Social Proof judging what others are

return favours or match given

position of power

consistently with previous decisions –

creates demand

more we agree with them – we

doing before deciding to do

behaviour

(authority, education)

we do not want to contradict our own behaviours

like and trust people who are similar to us

something yourself

Culture: knowledge, beliefs, preferences, laws, morals, customs, almost everything that influences an individual’s thought process and behaviour formed through experiences and learning – slowly evolves and changes over time – satisfies societies needs by providing norms Hofstede Dimensions of Culture:  Power distance = equalitarian or embraces hierarchy, the extent to which inequality and power are tolerated (who has authority, what type, how much, anyone in a position of power)  Individualism vs Collectivism = individualist or collectivist, the degree to which societies integrate and depend on groups, greater importance of individual or group goals (family sizes and roles, decision making process)  Uncertainty Avoidance Index = comfortable or uncomfortable with uncertainty, how unknown situations or unexpected events are dealt with as a society  Masculinity vs Femininity = nurture or power importance, gender equality and value of associated characteristics (value achievement, assertiveness and competitiveness, value cooperation, modesty and non-material things)  Long-Term Orientation vs Short-Term Orientation = focus on the future and long-term growth vs focus on the present, fast results and tradition  Indulgence vs Restraint = the extent and tendency of a society to fulfil its desires based on social norms of needs and regulations vs. having fun and enjoying life (self-control, need to seek pleasure, balance of work and play)

Week 7 – Individual Behaviour, Personality and Performance Job Performance

=

Individual Attributes Demography Personality<...