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Consumer Behaviour Theories Notes

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THEORIES Introduction Role theory (the perspective that much of consumer behaviour resembles action in a play)

• Each consumer has lines, props and costumes that are necessary to a good performance. Since people act out many different roles they may modify their consumption decisions according the particular play they are in at the times. The criteria that they use to evaluate products and services in one of their roles may be quite different from those used in another role.

• Another way of thinking about consumer roles is to consider the various plays that the consumer may engage in. One classical role here is the consumer as a chooser - somebody who can choose between different alternatives and explores various criteria for making this choice. But the consumer can have many other things at stake than just making the right choice.

• We are all involved in a communication system through our consumption activities, whereby we communicate our roles and statuses. We are also sometimes searching to construct our identity through various consumption activities.

• The main purpose of our consumption might be exploration of a few of the many possibilities the market has to offer us.

• We might feel victimised by fraudulent or harmful offerings from the marketplace and we may decide to take action against such risks from the marketplace by becoming active in consumer movements. Or we may react against the authority of the producers by co-opting their products and turning them into something else as when military boots all of a sudden became normal footwear for peaceful women.

• We may decide to take action as political consumers and boycott products from companies or countries whose behaviour does not meet our ethical or environmental standards.

• Hence as consumers we can be choosers, communicators, identity seekers, pleasure seekers, victims, rebels and activists. Market Segmentation (strategies targeting a brand only to specific groups rather than to everybody)

• Depending on its goals and resources a company may choose to focus on just one segment or several, or it may ignore differences among segments by pursuing a mass market strategy.

• In the internet based market Amazon tries to reach multiple segments at the same time while Google News UK focuses on being a search engine for information and news for consumers in the UK.

• Age o Consumers in different age groups have very different wants and needs and a better understanding of the ageing process of European consumers will continue to be of great importance to marketers. o While people who belong to the same age group may differ in other ways, they do tend to share a set of values and common cultural experiences that they carry throughout life. o Marie Claire, the French magazine, that is published in 25 editions and 14 languages, has noticed that its circulation and readership has fallen in past years due to primarily not keeping pace with its younger readers and their reading habits. In the past article length was typically 9-10 pages and what is now desired is 2-5. Rather than concentrating on serious articles on contemporary women's issues, the newer and younger readership is looking for something more fun and entertaining. Finding the balance of fun and serious has been the challenge in bridging women readers of different age groups.

• Gender o Differentiating by sex starts at a very early age - even nappies are sold in pink trimmer or blue trimmed versions. As proof that consumers take these differences seriously market research has showed that many parents refuse to put their baby boys in pink nappies. o One dimension that makes segmenting by gender so interesting is that the behaviours and tastes of men and women are constantly evolving. In the past most marketers assumed that men were the primary decision makers for car purchases, but this perspective is changing with the times.

o Sometimes, the gender segmentation can be an unintended product of an advertising

strategy. Wranglers launched a European campaign featuring macho Wild West values such as rodeo riding after an earlier campaign featuring a supermodel had made their sales of jeans to women grow 400% but put men off their brand. o Segmenting by gender is alive and well in cyberspace. In France a group of women started the first women's electronic magazine and web portal called Newsfam.com. These entrepreneurs are hoping to reproduce the success of American sites like IVillage.com and Women.com. Family structure o A persons family and marital status is yet another important demographic variable as this has such a big effect on consumers spending priorities. o Young bachelors and newlyweds are most likely to take exercise, go to wine bars and pubs, concerts and to the cinema and to consume alcohol. o Families with young children are big purchasers of health food and fruit juices while single parent households and those with older children buy more junk food. Home maintenance services are most likely to be used by older couples and bachelors. Social class and income o People in the same social class are approximately equal in terms of their incomes and social status. They work in roughly the same occupations and tend to have similar tastes in music, clothing etc. They also tend to socialise with each other and share ideas and values. Race and ethnicity o As our societies grow increasingly multicultural, new opportunities develop to deliver specialised products to racial and ethnic groups and to introduce other groups to these offerings. o Sometimes this adaptation is a matter of putting an existing product or service into a different context. For example in Great Britain there is a motorway service station and cafeteria targeted at the Muslim population. It has prayer facilities, no pork menus and serves halal meat. Further research into this area has shown that a halal service station was discussed as referenced but this does not appear to have been built. o Turks in Berlin do not have to rely solely on the small immigrants greengrocers and kiosks known from so many European cities as a Turkish chain has opened the first department store in Berlin, carrying Turkish and Middle Eastern goods only, catering to both the large Turkish population as well as to other immigrant groups and Germans longing for culinary holiday memories. o As one of the fastest growing segments in the European food market, halal foods now has its own on-going marketing research organisations and media outlets for European managers and consumers.

Product attachment theories

• The hallmark of marketing strategies at the beginning of the 21st century is an emphasis on building relationships with customers. The nature of these relationships can vary and these bonds help us to understand some of the possible meanings products have for us. Here are some of the types of relationship a person may have with a brand; o Self-concept attachment - the product helps to establish the user's identity. o Nostalgic attachment - the product serves as a link with past self. o Interdependence - the product is a part of the user's daily routine. o Love - the product elicits bonds of warmth, passion, or other strong emotion.

• Brand identities are thus potentially very closely linked with consumer identities and brands can elicit deep emotional engagement from consumers. Even brands we do not like can be very important to us because we often define ourselves in opposition to what we do not like.

Cultural influences Culture (the values, ethics, rituals, traditions, material objects and services produced or valued by members of society) (etic perspective - an approach to studying culture that stresses the commonalities

across cultures and emic perspective - an approach to studying cultures that stresses the unique aspects of each culture)

• Consumer culture is becoming increasingly globalised and brands have become signs of a global ideology of cultural vale and power.

• The process of globalisation has attracted a tremendous amount of interest in the last couple of decades. But learning about the relationship between the global and the local in the practices of other cultures is more than just interesting - it is an essential task for any company that wishes to expand its horizons and become part of the international or global marketplace at the beginning of the new millennium.

• This viewpoint represents an etic perspective which focuses on commonalities across cultures. An etic approach assumes that there are common, general categories and measurements which are valid for all countries under consideration. One such etic study identified four major clusters of consumer styles when they looked at data from the US, the UK, France and Germany; price sensitive consumers, variety seekers, brand loyal consumers and information seekers.

• One the other hand many marketers choose to study and analyse a culture using an emic perspective, which attempts to explain a culture based on the cultural categories and experiences of the insiders. For example cultures vary sharply in the degree to which references to sex and nudity are permitted. One study analysed responses to advertising for controversial products including potentially offensive adverts related to sexual behaviour such as adverts for condoms, female contraceptives, underwear and STI's. It was found that results for what was deemed controversial highly differed between the UK and New Zealand on the one hand and Turkey and Malaysia on the other. While negative reactions to sexual references differed, racist imagery was ranked among the most offensive in all samples. Post modernism theory (a theory that questions the search for universal truths and values and the existence of objective knowledge)

• The dominance of the brand, the possibility of engineering reality in the experience sector and the blurring of the fashion picture has been linked to major social change. One proposed summary term for this change is postmodernism.

• Postmodernists argue that we live in a period where the modern order with its shared beliefs in certain central values of modernism and industrialism is breaking up. Examples of these values include the benefits of economic growth and industrial production and the infallibility of science.

• A key word is pluralism, indicating the co-existence of various truths, styles and fashions. Consumers and producers are relatively free to combine elements from different styles and domains to create their own personal expression. This pluralism has significant consequences for how we regard theories of marketing and consumer behaviour. Most significantly pluralism does not mean that anything goes in terms of method or theory but it does mean that no single theory or method can pretend to be universal in its accounting for consumer behaviour or marketing practices.

• Together with pluralism one European researcher has suggested that postmodernism can be described by six key features; o Fragmentation - the splitting up of what used to be simpler and more mass orientated, exemplified by the ever growing product ranges and brand extensions in more and more specialised variations. The advertising media have also become fragmented with increasingly specialised TV channels, magazines, radio stations and websites for placing ones advertising. o De-differentiation - postmodernists are interested in the blurring of distinctions between hierarchies such as a high and low culture advertising and advertising and programming or politics and show business. Examples would be the use of artistic works in advertising and the celebration of advertising as artistic works. Companies such as Coca Cola, Nike and Guinness have their own museums. The blurring of gender categories also refers to this aspect of postmodernism. o Hyperreality - refers to the spreading of simulations and the making real of what was just fantasy. Disneyland is quintessentially hyperreal. Marketers are among the prime creators of hyperreality. o Chronology - this refers to the consumer's nostalgic search for the authentic and a preoccupation with the past. A postmodern way of looking at the same phenomenon is retro branding conceptualised as the revival or relaunch of a brand from a prior historical period

that differs from nostalgic brands by the element of updating. Retro brands are of relevance here as well because these revived brands invoke brand heritage which triggers personal and communal nostalgia. o Pastiche - a recent book on postmodern marketing is a pastiche of a novel. The Marketing Code basically uses the format of the novel to discuss various marketing techniques, promoting the view that marketing is an art form rather than science. This play on The Da Vinci Code is a playful and ironic mixing of existing categories and styles which is typical of pastiche. o Anti-foundationalism - this last feature of postmodern marketing efforts refers not to parody but to an outright anti marketing campaign. For example campaigns encouraging the receiver of the message not to take notice of the message since somebody is trying to seduce and take advantage of them. Postmodernism has also been attached to such themes as the ability of readers to see through the hype of advertising. This may suggest that we are becoming more skilled consumers and readers/interpreters of advertising, recognising adverts as hyperreal persuasion or seduction attempts which do not intend to reflect our own daily experiences. Younger consumers especially may be prone to detect and enjoy the self-referencing or intertextuality of advertising. Here the selfconsciousness of the brand as a brand and the ambivalence that follow from it is seen as the entertaining aspect of the contemporary marketing.

Consumer addiction

• The pressure of consumer society is not only felt on the environment but also on the individual consumer, sometimes with negative outcomes. Compulsive buying is a physiological and/or psychological dependency on products or services. While most equate addiction with drugs, virtually any product or service can be seen as relieving some problem or satisfying some need to the point where reliance on it becomes extreme. Even the act of shopping itself is an addictive experience for some consumers.

• Such compulsive consumption has been on the rise in Western societies throughout the last decades. But there is reason to believe that consumers in newly marketised economies are even more vulnerable. For example evidence from Germany indicates that the rise of compulsive buying behaviour is bigger in the newly marketised parts of central and Eastern Europe compared with the Western parts. Finally over consumption should not be regarded strictly as an individual failure, but may also be viewed as a structural problem that has evolved in our affluent consumer society.

Perception Perception (the process by which stimuli are selected, organised or interpreted) and stages in the perceptual process

• People undergo stages of information processing in which stimuli are input and stored. However, we do not passively process whatever information happens to be present. Only a very small number of stimuli in our environment are ever noticed. Of these, an even smaller number are attended to. The stimuli that do enter our consciousness are not processed objectively. The meaning of a stimulus is interpreted by the individual, who is influenced by their unique biases, needs and experiences. These three stages of exposure (or sensation), attention and interpretation make up the process of perception.

• Sensation refers to the immediate response of our sensory receptors (e.g. Eyes, ears, nose, mouth, fingers) to such basic stimuli as light, colour and sound. Perception is the process by which these stimuli are selected, organised and interpreted. We process raw data (sensation), however, the study of perception focuses on what we add or take away from these sensations as we assign meaning to them.

• The subjective nature of perception is demonstrated by a controversial advertisement developed for Benetton. Because a black man and a white man were handcuffed together, the advert was the target of many complaints about racism after it appeared in magazine s and on hoardings, even though the company has a reputation for promoting racial tolerance. People interpreted it to mean that the black man had been arrested by the white man. Even though both men are dressed

identically, people's prior assumptions shaped the adverts meaning. The company's goal was exactly that; to expose us to our own perceptual prejudice through the ambiguity of the photo. Such interpretations or assumptions stem from schemas, or organised collections of beliefs and feelings. That is, we tend to group the objects we see as having similar characteristics, and the schema to which an object is assigned is a crucial determinant of how we choose to evaluate this object at a later time. The perceptual process can be illustrated by the purchase of a new aftershave/perfume. We have learned to equate aftershave/perfume with romantic appeal, so we search for cues that (we believe) will increase our attractiveness. We make our selection by considering such factors as the image associated with each alternative and the design of the bottle as well as the actual scent. We thus access a small proportion of the raw data available to us and process it to be consistent with our wants. These expectations are largely affected by our cultural background. For example, a male consumer self-conscious about his masculinity may react negatively to an overly feminine brand name, even though other men may respond differently. A perceptual process can be broken down into the following stages; o Primitive categorisation - in which the basic characteristics of a stimulus are isolated, our male consumer feels he needs to bolster his image, so he chooses aftershave. o Cue check - in which the characteristics are analysed in preparation for selection of a schema; everyone has his own unique, more or less developed schemas or categories for different types of aftershave such as down to earth macho, mysterious or fancy French. We use certain cues such as the colour of the bottle to decide in which schema a particular cologne fits. o Confirmation check - in which the schema is selected o Confirmation completion - in which a decision is made as to what the stimulus is; the consumer decides he has made the right choice and then reinforces this decision by considering the colour of the bottle and the interesting name of the aftershave.

Perception thresholds

• There are some stimuli that people are not capable of perceiving - for example a dog whistle. Also some people are better at picking up sensory information than others. The science that focuses on how the physical environment is integrated into our personal subjective world is known as psychographics. By understanding some of the physical laws that govern what we are capable of responding to, this knowledge can be translated into marketing strategies.

• When we define the lowest intensity of a stimulus that can be registered on a sensory channel we speak of a threshold for that receptor. The absolute threshold refers to the minimum amount of stimulation that can be detected on a sensory channel. The sound emitted by a dog whistle is too high to be detected by human ears, so this stimulus is beyond our auditory absolute threshold. The absolute threshold is an important consideration in designing marketing stimuli. A hoarding might have the most entertaining story ever written but this genius is wasted if the print is too small for passing motorists to read.

• The differential threshold refers to the ability of a sensory system to detect changes or differences between two stimuli. A commercial that is intentionally produced in black and white might be noticed on a colour television because the intensity of colour differs from the programme that preceded it. The same commercial being watched on a black and white television would not be seen as different and might be ignored altogether.

• The issue of when and if a change will be noticed is relevant to many marketing situations. Sometimes a marketer may want to ensure that a change is noticed, such as when merchandise is offered at discount. In other situations the fact that a change has been made is downplayed as in the case of price increases or when the size of a product, such as a chocolate bar, is decreased.

• A consumer's ability to detect a difference between two stimuli is relative. A whispered conversation that might be unintelligible on a noisy street can suddenly become public and embarrassing in a quiet library. It is the relative difference between the decibel level of the conversation and its surroundings, rather than the loudness of the conversation itself, that determines whether the stimulus will register.

• The minimum change in a stimulus that can be detected is also known as the JND which stands for just noticeable difference. In the 19th century, Ernst Weber a psychologist found that the amount of change that is necessary to be noticed is related to the original intensity of the stimulus. The

stronger the initial stimulus the greater the change must be for it to be noticed. This relationship is known as Weber's Law. Many companies choose to update their packages periodically, making small changes that will not necessarily be noticed at the time. When a product icon is updated, the manufacturer does not want people to lose their identification with a familiar symbol.

Perceptual maps (a research tool used to understand how a brand is positioned in consumers' minds relative to competitors)

• In many cases, consumers use a few basic dimensions to categorise competing products and services and then evaluate each alternative in terms of its relative standing on these dimensions.

• This tendency has led to the very useful positioning tool of the perceptual map. By identifying the important dimensions and the asking consumers to place competitors within this space, marketers can answer some crucial strategic questions such as which product alternatives are seen by consumers as similar or dissimilar and what opportunities exist for new products that possess attributes not represented by current brands. Perceptual Interpretation (gestalt psychology, principle of closure, principle of similarity, figure ground principle)

• Interpretation refers to the meaning that people assign to sensory stimuli. Just as people differ in terms of the stimuli that they perceive, the eventual assignment of meanings to these stimuli varies as well. Two people can see or hear the same event but their interpretation of it may be completely different. Consumers assign meaning to stimuli based on schema, or set of beliefs, to which the stimuli is assigned. During a process known as priming, certain properties of a stimulus are more likely to evoke a schema than others. A brand name can communicate expectations about product attributes and colour consumer's perceptions of product performance by activating a schema.

• One somewhat disturbing example of how this works comes from America. Children aged 3-5 who ate McDonalds French fries served in a McDonalds bag overwhelmingly thought they tasted better than those who ate the same fried out of a plain white bag. Even carrots tasted better when they came out of McDonalds bag.

• Stimulus ambiguity occurs when a stimulus is not clearly perceived or when it conveys a number of meanings. In such cases consumers tend to project their own wishes and desires to assign meaning. Although ambiguity in product advertisements is normally seen as undesirable to marketers it is frequently used creatively to generate contrast, paradox, controversy or interest. For example, a popular advert from Benson and Hedges cigarettes featured a group of people sitting around a dinner table while a man wearing only pyjama bottoms stands in the background. The ambiguous character yielded valuable publicity for the company as people competed to explain the meaning of the mysterious pyjama man.

• People do not perceive a single stimulus is isolation. Our brain tends to relate incoming sensations to imagery of other events or sensations already in our memory based on some fundamental organisational principles. A number of perceptual principles describe how stimuli are perceived and organised;

• The gestalt; o These principles are based on work in gestalt psychology, a school of thought maintaining that people derive meaning from the totality of a set of stimuli rather than from any individual stimulus. The German word gestalt roughly means whole, patter or configuration and this perspective is best summarised by saying the whole is greater than the sum of its parts. o A piecemeal perspective that analyses each component of the stimulus separately will be unable to capture the total effect. The gestalt perspective provides several principles relating to the way stimuli are organised. o The gestalt principle of closure implies that consumers tend to perceive an incomplete picture as complete. That is, we tend to fill in the blanks based on our prior experience. This principle explains why most of us have no trouble reading a neon sign even if one of the letters is burnt out, or filling in the blanks in an incomplete message. The principle of closure is also at work when we hear only part of a jingle or theme. Utilisation of the principle of closure in marketing strategies encourages audience participation which increases the chance that people will attend to the message.

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