1- Imagine you are designing a marketing campaign for a new grocery store opening in the Downtown/Brickell area. What demographics would you be considering when creating this campaign? (Chapter 1)
2- Briefly outline what a corporate social initiative program might be for the Lowes (home & building supplies) corporation. Note: This should be something you come up with yourself, not an initiative that the company currently uses. (Chapter 2)
3- In your opinion, which of the five senses is most important in sensory marketing and why? (Chapter 3)
4- Describe the concept of gamification and give two examples of how a retail clothing store could use gamification in their sales and marketing strategies. (Chapter 4)
5- How can a brand’s personality influence consumer behavior? Give two examples of organizations whose brand personality directly relates to the consumers personality. (Chapter 7)
6- Explain how reciprocity, scarcity, authority, consistency, liking, and consensus can change a consumer’s attitude. Use a real-world example/organization for each concept. (Chapter 8)
7- In your opinion, which of the hedonistic shopping motives most accurately describes the shopping motives of the average American? Defend your belief. (Chapter 10)
8- Give two examples of brands that have relied on conformity to strengthen their brand and brand communities. Explain why these brands have been successful. (Chapter 11)
9- When thinking about the automobile market in South Florida, is social class or income a better predictor of consumer behavior? Defend your belief. (Chapter 12)
10- How does the McDonalds corporation adapt to local cultures in their international locations? (Chapter 14)

Chapter 1: buying, having, and being
Dr. Jennifer Houston

Consumer behavior:
People in the marketplace
Demographics are the descriptive characteristics of a population, such as age, gender, income, or occupation

We can also look at the social influence of product consumption by analyzing consumption communities, such as social media groups

Marketers can use information on demographic and consumption community preferences to engage in market segmentation strategies
Targeting a brands products, services, and ideas to specific groups of consumers whose lifestyles make them the most likely buyers
The sellers hope to be rewarded with brand loyalty, or a bond between their products and the target market
Consumer behavior concerns the products and services we buy and use, and the ways these fit into our lives

Marketers may find it useful to categorize buyers/consumers in order to understand and compare the buying trends of different groups

What is consumer behavior?
Consumer behavior is an ongoing process

Consumer behavior is the study of the processes involved when individuals or groups select, purchase, use, or dispose of products, services, ideas, or experiences to satisfy needs or desires


A consumer is a person, organization, or business who identifies a need or desire and makes a purchase

The Exchange

A transaction in which two or more organizations or people give and receive something of value

Seller or Influencer

A seller is a person, organization, or business who has goods and services available for exchange

An influencer is someone who recommends certain products to target markets on behalf of a seller

How do we divide customers into groups?
Though demographics are a simple way of categorizing consumers, consumer demographics can have a major impact on product choices

Some of the most important demographic groups include:
Family structure
Social class and income
Race and ethnicity

Our society is evolving from a mass culture where everyone shares similar preferences into a diverse culture

This evolution comes from an increase in the number of options available to consumers

Marketers typically identify heavy users, and use the 80/20 rule:
20% of users (consumers) account for 80% of sales

How do we divide customers into groups?
Once consumer groups have been identified or established, marketers can engage in relationship marketing by interacting with customers and maintaining bonds with these groups

Database marketing is a specific way of tracking consumers’ buying habits and using this information to tailor products to the target market
The collection and analysis of extremely large data sets is called Big Data
The internet provides a large volume of user information at quick velocities that allow sellers to make quick product decisions
User-generated content and Web 2.0
Marketers carefully define customer segments and listen to people in

Chapter 2: consumer well-being
Dr. Jennifer Houston

Business ethics and consumer rights
Business ethics are rules of conduct that guide actions in the marketplace and are the standards against which most people in a culture judge what is right and what is wrong
Honesty, trustworthiness, fairness, respect, justice, integrity, concern for others, accountability, loyalty

Ethics and legality can overlap, but they are not inherently the same
Businesses that engage in legal but unethical behavior risk losing customers over perceived immoral behavior
Ethical business is good business

The majority of consumers around the world say that they are willing to pay more for products and services from companies that are committed to positive social and environmental impact

Personal morals, ethics, and law

Personal Morals >>

Personal morals are the independent values that a person has about what is right and wrong in any given situation

Ethics >>

In business, ethics is beyond personal morals (in that it represents the beliefs of an entire organization and not just one person), but not necessarily rules of conduct that are legal vs. illegal on a larger scale

Codified Law >>

Codified law is the hard line of what is legal versus illegal under an organizations home government, or the government in which an organization conducts business operations

Needs and wants: do marketers manipulate consumers?
Many questions have come to light as consumers become more independent from companies in the buying process
Do marketers create artificial needs?
Is marketing necessary?
Do marketers promise miracles?
Do marketers sometimes try to convince consumers that their wants are needs?

We are moving from a marketerspace (companies call the shots) and into a consumerspace (the empowerment of consumers to choose how, when, or if they will interact with sellers)

Consumer rights and product satisfaction
There are three general courses of action for consumers who are dissatisfied with a product or service

Voice your response directly to the retailer for a refund
Privately respond your dissatisfaction to friends and boycott the product or store you bought it in
Use a third-party response and take legal action, register a complaint with the Better Business Bureau, or write letters to local media outlets to express your negative marketplace sentiments

If you’re not happy with a product or service, what can you do about it?

Organizations who encourage complaints get the chance to correct the situation, avoid an escalating problem on social media, collect valuable insight about the customers experience, and if all else fails, do a little damage control

Market regulation
Examples of U.S. Regulatory Agencies
Department of Agriculture
Federal Trade Commission
Food and Drug Administration
Securities and Exchange Commission
Environmental Protection Agency
Consumer Product Safety Commission
Interstate C

Chapter 12: income and social class
Dr. Jennifer Houston

Income and consumer identity
Money has complex psychological meanings – we equate it with success or failure, social acceptability, security, love, freedom, and even sex appeal
Our expectations about the future and our overall consumer confidence impacts how much we are willing to spend
When consumers feel optimistic about the future, they reduce the amount of money the save (their savings rate), they take on more debt, and they splurge on discretionary items
Consumer demands for goods and services depends on both our ability and our willingness to buy

Spending habits can be dictated by the discretionary income available to a household once the bills are paid to maintain a household

Income inequality and social mobility
There is a tremendous gap between the “one percenters” at the top of the global economy and the poorest segments of our world’s population

Income inequality is a huge issue, with the extent to which resources are distributed being very uneven within our population
Strategists describe an economy that’s driven by a fairly small number of rich people as a plutonomy

The CEO pay ratio (the difference between a CEO’s earnings and the average employee earnings within the company) is larger in the US than any other developed country

Income inequality and social mobility
Social mobility refers to the passage of individuals from one social class to another
Horizontal mobility occurs when a person mores from one position to another that’s relatively equal in status
Downward mobility and upward mobility are vertical movements in either losing or gaining social class

In order to avoid downward mobility, including joblessness, homelessness, and other symptoms of poverty, people must make shifts in spending to be more frugal and less materialistic in times of economic recession

Income-based marketing

Mothers with preschool children are the fastest growing segment of working people
Though women still earn .78 cents to a man’s dollar

As we recover from the Great Recession (2007-2009), the average American’s standard of living continues to improve

The college wage premium, or gap between what works with a college degree can earn compared with those without, has also grown dramatically

Targeting the top of the pyramid
Consumers can be divided into three groups base don their attitudes toward luxury:
Luxury is functional – high research, high longevity
Luxury is a reward – luxury products say “I’ve made it”
Luxury is indulgence – emotional approach, lavish and attention-seeking
Many marketers try to target affluent, upscale markets who have the resources to spend on costly products that command higher profit margins
Affluent individuals, however, do not necessarily fit into the same market segmentation
Researchers have noticed that many affluent people may indulge in luxury goods, but buy everyday items as cheaply as possible


Chapter 3: Perception
Dr. Jennifer Houston

In studying perception, we look at what marketers can add to the raw sensation’s consumers experience to give them meaning
Marketers can influence the sensory inputs that consumers receive, and appeal to consumers across multiple senses
Sensory marketing can be used to create a competitive advantage
Sensation refers to the immediate response of our sensory receptors to basic stimuli such as light, color, sound, odor, and texture

Perception is the process by which people select, organize, and interpret these sensations

Sensation Marketing

Marketers communicate meaning via the visual channel through a products color, size, and styling

Colors have been linked to consumers emotional responses

Choosing an appealing color palette is a key issue in package design

Companies can develop a trade dress and color forecasts

Sensation Marketing

Odors can stir emotions or create a calming feeling

Fragrance cues are processed in the limbic system of our brains

Sensation marketing
Music and other sounds affect people’s feelings and behaviors

Corporations can create audio watermarks to establish a brands sound distinctiveness

Companies can benefit from sound symbolism, or the process by which the way a word sounds influences our assumptions about the attributes of a product


Sensation marketing
The ability to incorporate the sense of touch has been important and profitable for companies

Technology has grown into a natural user interface, where users use touchscreens on virtually any type of technological device

Sensations that reach the skin can stimulate or relax us; we are haptic creatures who identify touch as an important sense to our experience with products
Buyers tend to want to touch objects before buying them
Encouraging shoppers to touch a product prompts consumers to imagine owning the product (the endowment effect)

Sensation marketing
Gastrophysics looks at how physics, chemistry, and perception influences how we experience what we taste

Some companies are developing an “electronic mouth” to test products prior to release

Augmented and virtual reality
Augmented reality refers to media that superimposes one or more digital layers of data, images, or video over a physical object (think Google Glass or PokemonGo)

Virtual reality technology in the consumer market drives the integration between physical sensations and digital information (think the Oculus)

The stages of perception
Our sensory threshold is what we are capable of perceiving from our environment
Our absolute threshold refers to the minimum amount of stimulation a person can detect on a given sensory channel
We also have a differential threshold, or an ability to detect changes or differences between two stimuli
The minimum difference we can detect between two stimuli is the just noticeable difference
Weber’s law says that the stronger an initial stimulus

Chapter 4: learning and memory
Dr. Jennifer Houston

How do we learn?
Theories about how we learn are heavily rooted in both behavioral and cognitive psychology
Behavioral learning theories assume that learning takes place as a result of responses to external events
Classical conditioning
Instrumental conditioning

Cognitive learning theories stress the importance of internal mental processes

Learning is a relatively permanent change in behavior caused by first-hand and observed experiences

Learning is an ongoing process, and sometimes we aren’t aware that we are learning – this is incidental learning, or the casual and unintentional acquisition of knowledge

Behavioral learning theories
The main components of classical conditioning are unconditioned stimuli, conditioned stimuli, and conditioned responses

Real life example:
Publix offers weekly by one, get one sales at their retail locations (unconditioned stimulus) that naturally drives purchasing behavior (the desired response). To reinforce the shopping behavior, Publix starts handing out free cookies during each of their buy one, get one events (conditioned stimulus). After repeated experiences of receiving cookies when these sales occur, a consumer learns to positively associate receiving a cookie with feeling like they’ve gotten a good deal on their groceries (conditioned response). Eventually Publix stops having their buy one, get one sales, but continues to give customers a free cookie on each visit. The presence of the cookie is now associated with feeling like you’re getting a good deal on your purchase.
Classical conditioning occurs when a stimulus that elicits a response is paired with another stimulus that initially does not elicit a response on its own

Over time this second stimulus causes a similar response because we learn to associate it with the first stimulus

Behavioral learning theories
Just like that, a free treat from the bakery that costs the organization significantly less than their buy one, get one sales has reinforced your shopping behavior at their grocery stores
For this psychology to trick to work on your consumer behavior, Publix would have to pair their sales with their free cookies in repetition to increase the stimulus-response association of getting a good deal
Effectiveness also depends on occasionally reinforcing the behavior by pairing a sale with a cookie from time to time to keep the association strong
Once the association has diminished, the consumers response of feeling like they’ve gotten a good deal simply because they’ve gotten a free cookie may face extinction
Classical conditioning occurs when a stimulus that elicits a response is paired with another stimulus that initially does not elicit a response on its own

Over time this second stimulus causes a similar response because we learn to associate it with the first stimulus

Behavioral learning theories
While using classical conditioning to strengthen your purchasing be

Chapter 11: group influences and
social media
Dr. Jennifer Houston

Social identity theory argues that each of us has several “selves” that relate to groups

In numerous experiments that employ the minimal group paradigm, researches show that even when they arbitrarily assign subjects to groups, people favor those who wind up in the same group with them

Humans are social animals. We belong to groups, try to please others, and look to others’ behavior for clues about what we should do in public settings

Social power
Referent power – if someone admires the qualities of a person in a group, they try to copy the behavior
Information power – held by people who simply know more about something that others desire to know
Legitimate power – someone who has been granted power by social agreements on their authority
Expert power – not just knowing more than others, but being an expert in the area
Reward power – held by someone who can provide positive reinforcement
Coercive power – held by people able to influence someone because of social or physical intimidation
Social power describes the capacity to alter the actions of others
The degree to which you are able to make someone else do something, regardless of whether the person does it willingly, gives you power over a person

Reference groups
Reference group influences don’t work the same way for all types of products and consumption activities
We’re less likely to consider other peoples preferences when we are choosing products that are not complex vs. when they are

There are different types of reference groups
Membership reference groups consist of people we know
Aspirational reference groups consist of people we don’t know, but admire anyway
Avoidance groups are people that we want to distance ourselves from
Our effort to avoid negative reference groups may be stronger than to join positive ones

Just because we find ourselves in the company of others doesn’t necessarily mean they impact what we say or do

A reference group is an actual or imaginary individual or group that significantly influences an individual’s evaluations, aspirations, or behavior

Conformity is a change in beliefs or actions as a reaction to real or imagined group pressure
For a society to function, members develop norms – informal rules that govern behavior
We conform in small ways every day, even though we don’t always realize it, and unspoken rules govern many aspects of consumption
The pressure to conflicts with another motivation we’ve discussed: the need to be unique

What makes it more likely that we will conform?
Cultural pressures – some cultures encourage conformity more than others
Fear of deviance –fear that groups may punish deviance
Commitment – the more people value a group, the more they want to conform to the group
Group unanimity, size, and expertise – as groups gain power, compliance increases
Susceptibility to interpersonal influence – how much an

Chapter 8: attitudes and persuasive communications
Dr. Jennifer Houston

The power of attitudes
Consumers have attitudes toward a wide range of attitude objects, from product-specific behaviors to more general, consumption-related behaviors
The functional theory of attitudes explains how attitudes facilitate social behavior because they serve some function for the person
Utilitarian function – basic principles of reward and punishment
Value-expressive function – relate to consumers self-concept
Ego-defensive function – protecting ourself from external threats or internal feelings
Knowledge function – when a person is in an ambiguous situation
Within the context of consumer behavior, an attitude is a lasting , general evaluation of people (including oneself), objects, advertisements, or issues

We call anything toward which one has an attitude and attitude object

The Abc model of attitudes

There are three components of attitudes (the ABC Model):
Affect – how a consumer feels about an object
Behavior – the actions a consumer takes towards a product
Cognition – what the consumer believes is true about the product

Hierarchy of effects
The high involvement hierarchy: think -> feel -> do
Assumes that a person approaches a product decision as a problem-solving process

The low-involvement hierarchy: think -> do -> feel
Assumes that the consumer initially doesn’t have a strong preference for one brand over another, and forms and evaluation after they have bought the product

The experiential hierarchy: feel -> do -> think
Assumes that we act based on our emotional reactions
Emotional contagion: massages that happy people deliver enhances our attitude toward the product

Attitude researchers developed the concept of a hierarchy of effects to explain the relative impact of the three components

Each hierarchy specifies that a fixed sequence of steps occur to develop an attitude

How do we form attitudes
Examples of commitment (low, middle, and high):
Compliance: we form an attitude because it helps us to gain rewards of avoid punishment
Superficial, and susceptible to change based on availability or social monitoring
Identification: we form an attitude to conform to another person’s or group’s expectations
Internalization: a high level of involvement when deep-seated attitudes become part of our value system
It’s important to distinguish among types of attitudes because not all form in the same way

Consumers vary in their commitment to an attitude, and the degree of commitment relates to their level of involvement with the attitude objects

How do we form attitudes
The consistency principle: we value harmony among our thoughts, feelings, and behaviors, and a need to maintain uniformity among these elements motivates us

The self-perception theory: assumes that we observe our own behavior to determine just what our attitudes are, much as we assume that we know what another person’s attitude is when we watch what they do

Chapter 14: culture
Dr. Jennifer Houston

Cultural systems
Our culture determines the overall priorities we attach to different activities and products, and it also helps us decide whether specific products will satisfy these priorities
The relationship between consumer behavior and culture is a two-way street

Culture is a societies personality
It includes both abstract ideas, such as values and ethics, and material objects and services
It’s the accumulation of shared meanings, rituals, norms, and traditions amount the members of an organization or society

Dimensions of culture
A cultural system consists of these functional areas:
Ecology: the way a system adapts to its habitat; the technology a culture uses to obtain and distribute resources shapes its ecology
Social structure: the way people maintain an orderly social life, including the domestic and political groups that dominate the culture
Ideology: the mental characteristics of a people and the way they relate to their environment and social groups

Cultural movement
Styles reflect more fundamental societal trends
A style begins as a risky or unique statement by a relatively small group of people and then spreads as others become aware of it
Styles usually originate as an interplay between the deliberate inventions of creators and are modified by the consumer to suit their own needs
Cultural products travel widely, across countries & continents
Influential people in the media and everyday influencers play a significant role in which items will succeed
Most styles eventually wear out and people move on to newer things
The cultural selection process never stops
When we are looking at purchase options, many possibilities initially compete for adoption
Many possibilities initially compete for adoption, but through the process of collective selection most drop out of the mix on the process of conception to consumption

Cultural movement

A cultural production system (CPS) is the set of individuals and organizations that create and market a cultural product
The structure of a CPS determines the types of products it creates
A CPS has three major subsystems:
A creative subsystem to generate new symbols of products
A managerial subsystem to select, make tangible, produce, and manage the distribution of new symbols and productions
A communications subsystem to give meaning to the new product and provide it with a symbolic set of attributes

Cultural stories and ceremonies
Myths are stories with symbolic elements that represents a cultures ideals
Myths serve four interrelated functions in a culture
Metaphysical – explaining the origins of existence
Cosmological – emphasizes that all components of the universe are part of a single picture
Sociological – maintaining social order because the authorize a social code to follow
Psychological – provide models for personal conflict
Every culture develops stories and ceremonies that help its members make

Chapter 10: buying, using, and disposing
Dr. Jennifer Houston

Situational effects on consumer behavior
A consumption situation includes a buyer, a seller, and a product or service
Many other factors are also involved, such as the reason we want to make a purchase and how the physical environment makes us feel
In addition to the functional relationships between products and usage situation, another reason to take environmental circumstances seriously is that a person’s situational self-image – the role they play at any one time – helps to determine what they want to buy or consume
Marketers need to fine-tune their segmentation strategies to take the usage situation/context into consideration
Many contextual factors affect our choices, such as our mood, whether we feel time pressure to make a purchase, and the particular reason we need the product

Situational effects on consumer behavior
Temporal factors
Time is one of our most precious resources, and we think more about what we want to buy when we have the luxury of taking our time

A person’s priorities determines their timestyle
With people feeling like they are more pressed for time than ever consumers may feel like they are in time poverty

In addition to physical cues, other people in the situation (co-consumers) affect purchase decisions

A consumers ‘psychological time’ is also important as consumers are more likely to buy when in certain moods as opposed to others
Many contextual factors affect our choices, such as our mood, whether we feel time pressure to make a purchase, and the particular reason we need the product

Situational effects on consumer behavior
Researches have determined four dimensions of time: The social dimension
The temporal orientation dimension
The planning orientation dimension
The polychronic orientation dimension

These researchers also identified five metaphors that capture the perspective of time:
Time is a pressure cooker
Time is a map
Time is a mirror
Time is a river
Time is a feast
Many contextual factors affect our choices, such as our mood, whether we feel time pressure to make a purchase, and the particular reason we need the product

The shopping experience
The competitive marketplace is one reason marketers engage in design thinking, which emphasizes the importance of creating products, services, and stores on something deeper than just looks

Marketers need to be mindful of the customer journey and map out the steps a customer takes when interacting with the company
The journey spans a variety of touchpoints moving from awareness to engagement to purchase
The consumer journey concept was influenced by the Japanese approach of total quality management called gemba
There is a fierce competition among brands for consumers attention, which involves a seller’s desire to lure customers into stores or to their website to complete transactions

Two basic dimensions, pleasure and arousal, determine whether we will reac

Chapter 7: Personality, lifestyles, and values
Dr. Jennifer Houston

One of the most famous theories of personality is that of Sigmund Freud, who believes that much of our personality stems from a fundamental conflict between our drive to gratify physical needs and the necessity to function as a responsible member of society
A person’s personality is their unique psychological makeup and how it consistently influences the way a person responds to his or her environment
These underlying characteristics, coupled with situational factors, are parts of the puzzle of what determine human behavior

Consumer behavior on the couch: Freudian theory

Freudian theory revolves around three systems that are a component of our personality:
The id, which operates on the pleasure principle & immediate gratification

The superego, our conscience

The ego, which operates according to the reality principle and is the mediator between the id and superego

Consumer behavior on the couch: Freudian theory

Most Freudian application to marketing relates to a product’s supposed sex symbolism/sex appeal

In the 1950’s, motivational research borrowed Freudian ideas to understand the deeper meanings of products and advertisements

Neo-Freudian theories
Karen Horney – believed people move toward others (compliant), away from others (detached), or against others (aggressive)
Carl Jung – pioneer of analytical psychology; believed that the cumulative experiences of past generations shape who we are today
We share a collective unconscious that are inherited
Shared memories create archetypes, or universally recognized ideas and behavior patterns
Young & Rubicam uses the archetypes to guide brands and make decisions

Freud’s work had a huge influence on subsequent theories of personality

Brand archetypes

(based in Jungian theory)

Trait theory
The most widely used approach to measuring personality traits is the Big Five dimensions of personality
Openness to experience

The Myers-Briggs Type Indicator is a Jungian-based, trait-measuring personality inventory that rates individuals’ personalities across 4 dimensions
Trait theories of personality focus on the quantitative measurement of personality traits, which are identifiable characteristics that define a person

The big five personality dimensions

The Myers-Briggs typology

Applying Trait theories to consumer research

The trait theory of personality can be used to pinpoint the specific personality traits & tendencies of segmented markets
General use of personality testing to predict consumer behavior has had mixed success
Some personality tests are not particularly valid in their measurements of consumers personality (like the MBTI)
Personality tests may not be designed for the context of marketing and be hard to generalize into consumer behavior
Tests may not be administered correctly, or may make ad-hoc chan

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