All Cases for Consumer Behaviour

All Cases for Consumer Behaviour 9th Edition by Barry J. BabinEric Harris

CONTENTS Case 1-1 IDEO: Consumer-Focused Innovation Case 1-2 Born or Reinvented - Case Answers Case 1-3 DemandTec By Acoustic Answers Case 1-4 Sears The Death of a Giant Answers Case 2-1 Self-Concept Self-Congruency Theory and Consumer Behavior Answers Case 2-2 Maslow's Influence Case 2-3 Narcissism Case Study - with question and answers Case 3.3 IGeneration Case 3-1 RateMyProfessors.com_Answers (1) Case 3-2 Open Your Eyes Case 4-1 Housing Options Answers Case 4-2 Is Cash Really King Case 4-3 Consumer Decision Making in a Pendemic Case 5-1 Satisfied Customers Answers Case 5-2 Susan G. Komen for the Cure_Answers (1) Case 5-3 Wise or Weaponry Answers

Case 1-1 IDEO: Consumer-Focused Innovation 1.

Where does IDEO get inspiration for its product designs?

Answer: IDEO’s inspiration comes from the consumer. IDEO’s product development teams use the “deep dive” process that consists of putting themselves into the consumers’ shoes. The resulting experience is very illuminating for the teams in understanding the consumers’ needs and their challenges in owning and using a product. Without direct personal experience, it is difficult to determine the features and benefits that consumers will value the most. Optimal product design must happen from the standpoint of the end user.

2.

What kind of value do you think successful products deliver to consumers?

Answer: Successful products need to “do the job” and create a rewarding personal experience for consumers. A well-designed product means that people enjoy using it as it makes their lives easier or makes them feel good about themselves. There are many dimensions of this “feel good” or hedonic aspect of product design. A person may gain a sense of social status from owning an expensive car or may derive a sense of freedom or empowerment from owning a fast car. The car is not just a thing that gets people from one place to another; it also influences how they feel while driving it.

3.

Why do you think having a product that simply works doesn’t always translate to consumer acceptance?

Answer: Consumers have many needs. These include both physical and psychological needs. A product that works but is unpleasant in some way, such as hard to manipulate, unattractive to look at, or reminiscent of something unpleasant, is likely to not catch on. In today’s society, consumers have many choices as many competitors exist. For example, when faced with a choice between a corkscrew that is easy to use and beautiful to look at and a corkscrew that just “does the job,” a consumer will probably choose the former.

4.

What is the relative importance of the utilitarian versus the hedonic value of products, as suggested by the work of IDEO? Answer: IDEO’s success seems to come from the understanding that utility alone is not sufficient in a product, which is why their product development strategy requires total immersion in the consumer experience. When a new product is developed that solves a problem that no other product has solved before, then it is very likely the utilitarian function will prevail. For example, the first mass-produced automobile, the Model T Ford, came in one style and one color, with Henry Ford famously saying, “Any customer can have a car painted in any color that he wants so long as it is black.” General Motors challenged the Model T by introducing cars in different styles and colors because there were consumers who sought variety, which is a hedonic value.

5.

Do you agree with Edison’s observation that “genius is 1% inspiration and 99% perspiration”? Explain your answer.

Answer: Students’ answers will vary. Insights don’t come out of nowhere. People who succeed in solving problems usually have spent a good deal of time thinking about the problem and looking at it. IDEO realizes that it’s not possible to solve consumers’ problems without understanding them first, which is why the “deep dive” process is so important to the teams for developing a market. Since individuals are motivated by a complex set of both utilitarian and hedonic values, the product that will deliver the biggest bundle of value satisfaction will be the most appealing to consumers.

Case 1-2 Born or Reinvented in the “Foreign” Land? Examining Brands and Country of Origin 1. Examine further the “2019 Ranking of Top 100 Global Brands”. Classify these brands while considering the product category or sector and the country of origin. Can you detect a pattern?

For example, do you see that strong players in the automotive sector emerge largely in Western Europe?

Answer: It should be clear that automotive products do center largely in Western Europe. Also, many of the technological products originate in the U.S. In fact, many of the products do come from the U.S. From the table we also see that luxury products may tend to originate in France, at least in the case of Chanel. These findings influence consumer perceptions and country-oforigin effects. The intent of this question is to get students thinking about country of origin effects and how they may play out across industrial sectors. Also, as the case emphasizes, these effects do differ across demographics, education, and socio-cultural factors.

2. List ten brands that you have in your home. Then research to find the country of origin of all the brands on your list. What do you find? How can marketing professionals make use of the information that you have analyzed?

Answer: Responses to this question will vary. And, they will likely largely mirror those from the question #1. Patterns should emerge, and student should respond with ideas about how marketers can use this information. The important point here is how the perception of county-of-origin effects influence consumer decision making and behavior. Marketing professionals work to research these effects and to promote products in a way that make sense within the consumers’ schemas. For example, Mercedes clearly promotes German engineering in their advertisements, and consumers around the world understand how this is an attribute of automobiles made in the country. This is a very clear and visible example of marketing mix components that are associated with country-of-origin effects.

3. Use the “2019 Ranking of Top 100 Global Brands” table to test the level of BoK of at least five people (excluding yourself). Examine and write a short reflection on how the extent of their knowledge varies with their lifestyles.

Answer: Again, responses will vary. Some people will be able to correctly identify the country of origin, while others will not. Patterns may emerge based on lifestyles. For example, people who enjoy technology and keep up-to-date with trends will likely be able to correctly identify county of origin, etc. Others may not. This is a great question for addressing how country of origin effects play out in consumer behavior, knowledge, and decision making.

4. Your textbook refers to the concept of perceptual maps. Construct a perceptual map using the following two dimensions: (i) product ethnicity (low / high), and (ii) level of BoK (low / high).

Choose at least ten brands or product categories to represent on the map. You may use the list of brands/categories available at the Interbrand website to populate a list for the map. Use the information from question 3 to identify the average level of knowledge of product ethnicity and extent of BoK.

Answer: Responses to this question will vary greatly. Students should be able to defend the positioning of the brands included.

5. Using the same information in question 3, how do you think a company can enhance its understanding of market segmentation so as to efficiently target a marketing message to its potential and existing customers?

Answer: Depending on previous responses, students should be able to discuss country of origin effects as segmentation tools for marketers. Given the information in the case, students should include discussion of perceptual effects as they apply to this important issue. And, they may expand into popular demographic variables including education, socio-economic factors, and lifestyles. The case mentions this in the discussion regarding segmentation and decision making. Changing country-of-origin perceptions depends largely on belief and attitude change. The student would most likely not have studied this chapter yet, but they may allude to it in this answer. Also, the student should be able to discuss how internationalization factors (as discussed in Chapter 1) relates to country-of-origin effects and segmentation as well.

Case 1-3 DemandTec by Acoustic: Using Collaborative Analytics and Science-Based Price Optimizatization in a Fragmented Latin American Market Answers: 1. Predictive models used by Target, identified changes in the purchase behavior of female shoppers, including increased spending on supplements important to neonatal development as well as unscented soaps and lotions, which indicated they might be pregnant. What other changes in purchase behavior might indicate that a female shopper is pregnant?

Answer: Answers will vary. The idea here is to not focus on obvious baby-related products such as diapers, formula, strollers, etc. And, the focus sudden changes in buying behavior.

For example, an expectant mother might exhibit common shopping behaviors that are out of her norm such as beginning to purchase organic foods, larger clothing, cameras, snack goods, anti-nausea medication, antacids, and body pillows. She would also tend to suddenly cut back on alcohol and tobacco purchases, and also to cut back on deli meats.

2. How does the use of collaborative analytics provide value to the consumer and help to facilitate exchanges between buyers and sellers?

Answer: Collaborative analytics, as the case discusses, allow for an improved analysis of massive amounts of data that not only increases efficiencies for the marketer, but that also allows customers to receive highly-personalized offerings. As such, these techniques offer improvements for both the marketer and consumer. With the focus on the price optimization software detailed in the case, the student should be aware that prices are able to be changed at the local level, further creating benefits for both the marketer and customer.

3. GPA uses collaborative analytics to look at the shopping behavior of their customers. The next time you purchase groceries, make a list of every item that you purchased. Try to organize them in a meaningful way. Imagine that a researcher was using ethnographic methods to analyze your grocery list. What insights might they have about you based on your purchases?

Answer: Answers will vary. Several examples are given below that signal a great deal about lifestyles: Health-focused consumers Organic milk Organic fruit and vegetables Organic cereal Free-range eggs

Fresh beef Whole grain bread Natural peanut butter Sugar free jam Fitness-prone consumers Protein powder Animal lovers Cat food Cat litter Cat treats Dog food Dog treats Wine Enthusiasts Wine Coffee / Tea Lovers Coffee Tea Benefit-sought toothcare (based on coffee/tea lovers) Advanced whitened toothpaste Home / Body focus consumers Water softener salt Leisurely / Hobby segments Coastal Living magazine Real Simple magazine

4. Choose a local retailer that is not part of a national or regional chain. Assume they have decided to expand their efforts internationally; and have therefore, enlisted the help of DemandTec by Acoustic. How will the use of collaborative analytics help them to better understand consumers in this new market?

Answer: Answers will vary. While it is difficult for a local retailer that is not a part of a national or regional chain to expand internationally, DemandTec by Acoustic could help tremendously. As detailed in the case, DemandTec allows marketers to gain valuable insights that are not easily

identified. All aspects of the marketing mix, including product, place, price, and promotion can be greatly impacted by the analysis. While answers could vary, retailers such as grocery stores, appliance stores, footwear stores, and athletic (golf, etc.) stores could greatly benefit from the use of DemandTec. For example, a footwear store could gather important segmentation and pricing information as is detailed in the case. This information could be used to help build effective and efficient product assortments, promotional campaigns, and pricing tactics. The purpose of this question is to get students to think about how collaborative analytics can help marketers of all sizes.

Case 1-4 Sears: The Death of a Giant Answers: 1. Describe some of the consumer behavior trends covered in this book that have affected Sears?

Answer: Answers will vary. Whereas Sears was once the largest retailer in the world, the company failed to keep up with changes in consumer trends and also fell trap to some highly questionable strategic decisions that left the company heading for bankruptcy.

The most obvious consumer trend, as highlighted in the case, is the trend toward discount stores and everyday low prices such as those found at Walmart. One trend that is noted in the book is a trend toward frugality, and this has led consumers to discount retailers. The company also failed to keep up with developments in ecommerce and felt the pain of falling behind Amazon. Big box shopping, like that available at Sam’s Club, Costco, Home Depot, and Lowe’s also directly impacted Sears in a seriously detrimental way. Sears has relied heavily on their presence in shopping malls, and mall shopping has seen a gradual decline in popularity (exacerbated by the Covid-19 pandemic). Ultimately, it’s been a perfect storm of failing to recognize and react to consumer trends, failing to efficiently compete in the ecommerce sphere, and failing at corporate-level strategy that has led to the rapid and well-publicized decline of Sears.

2. Describe the external and situational influencers that have likely steered shoppers away from Sears?

Answer: The trends highlighted in question #1 all apply (changes in value perspectives, shopping behaviors, frugality, etc.) as do changes in the situational influencers of store closures and merchandise unavailability. These closures and resultant disruptions to product deliver and order fulfillment (along with disastrous) vendor relations have steered customers away from the once proud retail giant. The Covid-19 pandemic, an important situational influencer, further pushed consumers towards online shopping.

3. Compare and contrast the total value concept for Sears versus your favorite retailer?

Answer: Answers will vary by favorite retailer. If the student were to compare Sears and Walmart, for example, we would expect the benefits from shopping at Walmart to include low prices, a wide selection of discounted items, and shopping convenience in the form of stand-alone bricks and mortar stores. The costs associated would be the relatively low monetary cost, but the higher costs in term of product image due to a focus on discounted items. For the total value concept, Walmart understands, and promotes, the everyday low price strategy. That is, they market to a carefully targeted consumer group that values price over quality. For Sears, the total value concept has been somewhat vague over the years. The department store approach that offered slightly more upscale products at relatively higher prices (usually within shopping malls) no longer appeals to most customers as compared to mass merchandise discount stores. The total value concept for Sears has largely been considered to be confusing by most consumers, leaving consumers with little motivation to shop at the stores.

4. What strengths does Sears still possess? Can Sears be revived? Please support your answer.

Answer: Answers will vary. This is a very difficult question. In mid-2021, there are only a handful of Sears stores remaining (less than 30). And, the holding company, Transformco, is dealing with a mountain of active court cases and litigation regarding the retailer. Furthermore, Transformco is a privately-held company, which makes much of the speculation regarding future strategy and financial performance very difficult to assess. It is easy to suggest that Sears may be able to survive as an online retailer, but even at that, it is very difficult to complete with Amazon and Walmart.

Much of the financial muscle of the company remains in real estate, but even this is being actively divested as a part of the strategy to stay afloat. The single best solution from a students’ perspective would probably be in online marketing and ecommerce, and possibly very small, carefully targeted Sears boutique stores that are laser focused on specific locales. Even retail analysts are currently baffled at the prospects for Sears.

Students, however, should be able to support their answers, which again, will likely focus on online / ecommerce.

Case 2-1 Self-Concept, Self-Congruency Theory and Consumer Behavior Tip for analysis: The important part for marketers is that self-concepts and self-congruency theory are important considerations in the marketing mix, including influencing branding, marketing communications, public relations, and more. Marketers will often segment by various attributes related to self-concept. For example, some marketers will indeed target those for whom being a conservative is a large part of their self-concept (for an example, do some research on

Black Rifle Coffee Company), while others might target those who consider themselves “foodies” (those with a strong interest in and love for cooking and eating good food and exploring a variety of foods). Therefore, when considering the following questions, research various brands’ marketing communications (websites, social media pages/posts, ads, etc.) to see if you believe them to be a fit for Kate’s self-concept or your own self-concept. Be able to defend the extended selves you’ve developed for you and for Kate.

1. Given the description of Kate, what products, and what specific brands within certain product categories (for example, if she owns a vehicle, the brand and type of vehicle she owns) do you think are part of her extended self? Think of products in a broad and thorough sense. They may include physical goods such as clothing, vehicles, books, music, furniture, and services such as restaurants, personal care services, memberships and the like. Be as descriptive as possible in your description of her extended self.

Answer: Answers will vary by individual. However, typical products students could mention here include that Kate owns a used hybrid car, but utilizes public transport services whenever possible. She may purchase brands of clothing that fit her outdoor lifestyle and support causes that she considers part of her identity, such as Patagonia, though she may purchase these from thrift shops or Goodwill due to her limited income and desire to contribute to less waste. She may belong to organizations such as the Sierra Club and volunteer for Crystal Springs Foundation, an organization that provides free environmental educational services to the public. She likely owns many hiking and camping brands, but generally value brands such as Coleman, due to her limited income. Again, this is just a sample.

Students will arrive at a variety of products and brands that make up Kate’s extended self.

2. Take some time for introspection. Thinking deeply, write a description of the characteristics [core beliefs, psychographics (activities, interest, and opinions], etc. that define your actual self. What products, and what specific brands have you bought in certain product categories that reflect your actual self.

Answer: This answer will completely depend on each student’s actual self.

3. Do the same thing as you did in Question 2., except do this for your ideal and possible selves. Since as a student you may not have the financial resources to have already bought many of these products, don’t place any emphasis on whether or not you can currently afford these products and brands; what would you buy, if you could, to reflect these aspirational selves?

Answer: Again, answers to this question will vary by student. However, many students might ideally see themselves in the future as desiring to be extremely successful in a business career. Many may ideally like to own a luxury vehicle, buy expensive clothing brands, and belong to a country club. They may ideally wish to live in an upscale gated community and become financially independent by a certain age, thus engaging in investment services they believe will get them there. They may recognize

that due to certain circumstances in their lives, however, that their possible self is somewhat more middle to middle-upper class, owning a value brand of sedan or SUV such as Toyota, living in a middle-class neighborhood, and wearing nice but more value-oriented clothing. With their possible self, they may see themselves as having more free time due to less work demands, and purchase more products related to their hobbies and interests. Expect a very large variety of answers here.

The important thing is simply to note whether the products and brands fit the possible and ideal selves as described by the individual student.

Case 2.2 Maslow’s Influence on the Chicago Bulls and Los Angeles Lakers

1. Maslow described several steps one can take to attain self-actualization in his book The Farther Reaches of Human Nature which is quoted above. What behaviors/habits in your own life can you work on to achieve self-actualization?

Answer: Responses to this question will vary greatly. Students may discuss such things as being kind to others, enjoying meaningful relationships, focusing on things bigger than themselves, having a sense of humor in challenging situations, living independently and not structuring their lives around the opinions of others, and more.

Students may also reflect on the entire hierarchy found in Maslow’s approach.

A particular focus may be on the step between Esteem and Actualization. The ideas brought up in this answer allow for a great discussion on how to become “actualized” in the Maslow approach.

2. In what ways can you foster self-actualization in other members in the groups, clubs, or organizations you belong to?

Answer: Successful companies, clubs, and organizations often focus on things bigger than themselves. They have a mission, cause, or deeper purpose that resonates with its members. Often the cause is related to a concern for the general well-being of others, and for success overall. By encouraging meaningful relationships, focusing on the success of the team and things bigger than themselves, members can help to instill this sense of actualization. As the case discusses, these principles can help to bring about the ultimate success of the group.

3. Maslow described peak experiences as "transient moments of self-actualization," brief moments of magnificence and awe. More specifically, Maslow said, "Think of the most wonderful experience of your life: the happiest moments, ecstatic moments, moments of rapture, perhaps from being in love, or from listening to music or suddenly 'being hit' by a book or painting, or from some creative moment." What peak experiences have occurred in your own life?

Answer: Responses will vary based on the individual. Peak experiences can be described as moments of wonder, joy, or euphoria. They are often characterized by a sense of feeling connected to the universe. These moments may occur when a deeper meaning suddenly becomes clear in one’s life. These are not necessarily spiritual.

The responses to this question will naturally vary, but should have the common

theme of total euphoria. This can be related to the motivational aspects of the case.

4. Recognizing peak experiences can point you in the right direction for self-actualization, based on the experiences you listed in the previous question, what careers, interests, hobbies, etc. can you pursue to help achieve self-actualization?

Answer: Based on the peak experience(s) students list in previous question, they should dig deeper and see if they can find a career/hobby/etc. that would help elicit more such feelings in their lives. For instance, perhaps a student discusses losing track of time and really enjoying drawing. This sense of creativity could be fostered by pursuing a career as a graphic artist or at least continuing to draw as a hobby. Or perhaps a student will say a peak experience occurred when they volunteered at a homeless shelter and hearing the stories of those less fortunate than themselves. Is it possible for the student to use their marketing talents to help the organization?

The purpose of this line of questioning is to encourage students to live authentically. Instead of living according to what other people say or suggest, one should follow insight gained from personal experience. All should be honest with themselves about their needs and desires in order to achieve self-actualization.

5. In what way does Maslow’s hierarchy apply to consumer purchase decisions? Using examples from your own buying behavior, detail products that you have purchased that related to each of the levels of Maslow’s needs.

Answer: Again, the responses will vary greatly. However, the student should clearly relate product / buying examples to each level of need. For example, food and shelter (apartment) decisions pertain to physiological needs. Home / computer security purchases pertain to safety needs. Many purchases such as going to a restaurant, having a family dinner, joining clubs, going out to a bar, etc., pertain to belongingness needs. Esteem need examples could include things like selfdevelopment, exercise, etc. Actualization needs can be found in symbolic product purchases like a Rolex watch, etc. Also, experiences (much like the esteem need responses) apply here as well, such as learning a new language, going on world trips, etc.

Narcissism – Look at Me Everyone

– By Robert A. Bergman (Assistant Professor of Marketing, Lewis University – Romeoville, IL) Dr. John Mayer, a clinical psychologist, ignominiously made famous on season 4 of Penn & Teller’s SHOWTIME series “Bullshit”– in an episode about “Manners”, coined the acronym “COW” to describe the tendency of many people to behave like “they are the Center-Of-The-World … COWs.” He even wrote a book about it entitled, “You’re not the only one on this Planet!”.

What he is really saying is that most people have a tendency toward being self-absorbed, full of self-admiration, extremely self-focused, having a high level of self-importance, and like being seen as an authority. In short, they have narcissism … or can be described as narcissistic.

The term originated from Greek mythology, where the young Narcissus fell in love with his own image reflected in a pool of water. Narcissists, like John Mayer’s COWs are LAME …

“Look At Me Everyone!!”

So, now that you know what narcissism means, let me tell you a story. The reason I tell you a story is that you’ll learn this lesson easier and better.

According to Psychology Today magazine, the reason that stories work so well on us is that we are susceptible to getting “swept up” in both their message and in the manner of their telling. Our brains respond to content by looking for the story to make sense out of the experience. Those in sales and marketing have known for a long time that stories trump data when it comes to persuasion because stories are easier to understand and relate to.

So, let me tell you a story … Once upon a time, there was a family of 3.14 people – the average family size in the US. Since “number of people per family has decreased over the past few decades … we’ll round down to 3. They are the Smith’s. Bob, Polly, and Alexandra.

Smith is the most common surname in America.

They live in Illinois, where they drive a black (most popular car color in America) Dodge Caravan - which is the most popular car in the state. They have a vanity license plate. In 2007, about 3.8% of vehicles had vanity license plates. It is estimated that the number has more than doubled since then. In fact, vanity plates are getting so popular … and the available letter/number combinations becoming more rare, that Texas has started auctioning off vanity plates hoping to raise about $5 million dollars per year. The vanity plate “FERRARI” went for $15,000. Displaying vanity plates boosts self-esteem - the fourth level of Maslow’s Hierarchy of Needs. Vanity plates say "who I am and what I want people to know about me.

They have a “I have an honor student” bumper sticker too – because most parents live vicariously through their children … boosting our self-esteem. They have the “family” stickers on their back window showing they are loyal fans of Disney. They have a window sticker that proudly displays their affiliation to the Chicago Black Hawks. They also have a “Proud to be Union” bumper sticker. This is all behavior that demonstrates Maslow’s 3rd level – Love and Belonging.

They also have a handicapped placard hanging from their rearview mirror … or a garter … or a Christian cross … or dashboard Jesus.

For all of these things we display on our cars, psychologists and researchers say it's more complicated than just vanity. Displaying signs and symbols of “who we are”, helps us predict and control what's happening in our lives.

It's "one of the ways we can let the world know “what I am”, “who I am” and “how people should treat me”.

The Smiths take selfies. Lots of selfies. According to psychologists, people who post selfies on social networks are more likely to exhibit some narcissism. Finding fulfillment is another reason why the selfie has become such a focal point in people's lives. People take selfies of just about anything and everything they do in their lives and post pictures on social media sites where hundreds of people will see it … to say “I am special”.

One thing many people are looking for via their selfies is a boost to their self-esteem. From a psychological perspective, people are looking for an avenue to fulfill this need and they have found it on their social media pages. Every like, share, and positive comment is a boost to their confidence, and this works to fuel the desire for more selfies.

In a TODAY/AOL body image survey, 41% of adult women said selfies and other flattering online photos make them “feel more confident”. For teenage girls, the results were even more empowering: 65% said seeing their selfies on social media boosts their confidence, and 40% of all teens said social media helps “them present their best face to the world.”

The Smith’s write a Christmas letter each year to tell their friends, relatives, co-workers, and everyone else on their Christmas card list how great their year has been – another boost to their self-esteem, confidence, achievement, and respect by others … feeding their narcissism.

They regularly post about themselves on Facebook and change their profile picture often.

In studies, the more people changed their profile picture, the more likely they were to report narcissistic traits. Posting, tagging and commenting on their own photos on Facebook is associated with narcissism … for both men and women.

I guess the Smith family shows some narcissistic tendencies – a strong need for self-esteem, belonging and attention.

In the 1970s, psychologists thought that about 7% of people has narcissistic tendencies.

Today, psychologists believe it’s closer to 70% - simply because we now have EASY ways to express ourselves to the world.

Marketers can use this knowledge about the compelling evidence of narcissistic tendencies in people to craft very effective marketing strategy.

Thank you Smith family for helping us to learn this valuable lesson.

Every good story has a moral to it. Based on what you know about marketing and consumer behavior, what do you think is the moral to this story?

Case 2.3 “Narcissism – Look at Me Everyone” 1. Brainstorm at least 5 strategies or tactics that the RETAIL side of a company (brick-andmortar retail stores) can carry out to cater to the narcissistic tendencies of each of the following audiences: a. Current customers b. Prospective customers c. Internal customers (store employees)

2. Brainstorm at least 5 strategies or tactics that the ONLINE side of the business (or companies that conduct all of their business online) can carry out to cater to the narcissistic tendencies of each of the following audiences: a. Current customers b. Prospective customers c. Internal customers (employees within the online operations)

3. Brainstorm at least 5 strategies or tactics that SERVICE companies can carry out to cater to the narcissistic tendencies of each of the following audiences: a. Current customers b. Prospective customers c. Internal customers (company employees)

Case 3.3 IGeneration

1. What are the distinguishable characteristics of Gen Z? Generation Z is considered to be made up of people who were born in 1997-2012. Some of the characteristics of this generation are considered to be financially driven and pragmatic in some aspects. They tend to be highly educated, diverse, and mobile. Of course, they grew up being “always connected”. They are also “truly global” and have a strong sense of diversity and inclusion. They also tend to see through marketing gimmicks easily.

2. What types of social power, if any, are most relevant for Gen Z consumers?

Generation Z has been impacted by the technological boom from screen based technology. In all of human history we have never seen anything like this. This has given the young people of Generation Z voices online. This has been seen through social media outlets such as Facebook and Instagram. There have been lots of social movements that have been influenced by Generation Z people via the internet. They tend to look for groups that represent expert and referent power, in particular, as they look for what they consider to be “truth” and also to fit in with other similar consumers.

3. How has social media and group influence helped to define Generation Z? Answers will vary, but this generation has been impacted by social media in extremely significant ways. Social media platforms are were most of these consumers get their

information. There are also a significant number of social media influencers in this group, people making money by just doing everyday tasks. Platforms such as TikTok and SnapChat have revealed how easily group influence can take place online. These tools represent a marketing tool for influencing large groups of people, especially those who think similarly on certain ideas or products.

4. Do you agree with the name “iGeneration” for Gen Z? Why or why not?

Answers will vary but it shouldn’t be surprising if many consumers agree. The name is quite fitting because a majority of this group of consumers have iPhones (or smartphones). Most consumers have all come in contact with Apple Products and have been directly or indirectly influenced by these products. It is such an innovative device.

The ability to have a product do almost anything technology related is astounding.

5. What makes the Generation Z so much different as a target market than generations before?

The reason Generation Z is such a different target market is because the group is so heavily impacted by social media and the internet. And, these consumers are easily accessible to any business or organization. Their data are monitored 24/7. For the consumer, this connectivity provides very well-targeted ads for products they would be interested in.

Case 3-1 RateMyProfessors.com: Does This Site Really Help in Choosing Classes?

1.

What assumptions can you make about managerial decision making, as it relates to the Millennial generation, from the case?

Answer: Millennials are more technologically savvy and connected. They have more access to the Internet and social networking sites than any other demographic segment.

Therefore, they use technology and social media tools to assist in data gathering for the managerial decision-making process.

They rely heavily on consumer feedback and opinions posted on the Internet and various social media sites. They are impulsive and make decisions quickly without evaluating all the data, as evidenced by Tom and Alex’s decision to ignore the dialogue text of consumer reviews and focus their attention on the numerical or value (star) ratings.

They work in groups or teams to share data and make decision making a group activity.

2.

Did Tom and Alex follow a logical and rational managerial decision-making process in determining their class schedules? Why, or why not?

Answer: Yes, they determined what constitutes “success” as a result of their decision making— and the factors by which they should measure success for their particular situations.

Yes, they also determined the evaluative criteria for data gathering purposes, and their use in the decision making process.

Yes, they factored in potential value-adds to the available data—the “chili pepper.”

No, they ignored some very valuable data—the dialogue text of the professor ratings.

3.

Identify the group influence that the information provided on RateMyProfessors.com places on Tom and Alex?

Answer: The group influence placed on Tom and Alex by the information provided on RateMyProfessors.com can be classified as reference groups. The ratings provided for the professors Tom and Alex are from individuals who have significant relevance for Tom and Alex—students like them (reference groups) at State U that have taken classes with the professors they are researching.

At first, the ratings on RateMyProfessors.com could be considered an informal group for which there is no formal membership requirement. However, it is really a formal group since there are applications and processes for membership, stated rules, accepted values, and codes of conduct. Students who provide ratings on each

instructor are current or former students of State U, which would make this a formal group.

Entrance into the classes where Tom and Alex deem the professor to be extraordinary could be conceived to constitute an aspirational group.

The current and former students who post reviews have referent and legitimate power—and to a degree, because their reviews can be embellished or made up. They have coercive power as well.

4.

Describe the types of interpersonal influence that the information provided on RateMyProfessors.com places on Tom and Alex.

Answer: Tom and Alex are subjected to informational influence since they are relying on the information provided in the student reviews of the professors. They believe the reviews are true and unbiased since they are submitted by students they perceive to be just like them.

Tom and Alex experience utilitarian influence in that they expect to receive a good class experience and good grade (rewards) from enrolling in these classes.

5.

What influence do consumer ratings that fall either above or below the norm have on your managerial decision-making process? For example, when a professor (or an Amazon.com product) is rated with 3 stars, what strength do you place on the few individual reviews that rate them with 1 star or 5 stars?

Answer: Instructors will get many answers revolving around 2 arguments: a) The 1 star and 5 star ratings were anomalies and should be disregarded since there are always some dissatisfied or exuberant customers. b) The 1 star and 5 star ratings are the most valuable ratings to read and scrutinize the dialogue of the review. That’s where reading what the consumer wrote is most important.

Case 3-2: “Open Your Eyes – Consumer Waste and the Ocean” 1. “Covid-19 has changed how we look at sustainability.” Discuss how you agree or

disagree with this statement.

Answer: Students will respond to their own experiences during COVID19 and the effects on their perception of sustainability. Definitions of sustainability can range between specific segments of sustainability, consumerism and anti-consumerism. This question will open the conversation for students and the faculty member to understand how students look at sustainability.

2. Look up your university sustainability initiatives. Look up another university outside of your country or state and look at their sustainability initiatives. How are they similar or different?

Answer: Students should first start with the exploration of their own campus sustainability.

This will help you understand how they view sustainability on their own campus. It may include trash receptacles, composting, campus gardens and water filling stations. Examples of sustainability programs include the following: University of California Santa Barbara https://sustainability.ucsb.edu/ University of Texas, El Paso https://www.utep.edu/student-affairs/greenfund/ Pepperdine University, https://www.pepperdine.edu/sustainability/ 3. Consumer behavior changes take time. Find a commercial that affected change in your life. The change does NOT have to be related to sustainability (i.e. drug abuse, underage drinking, teen anti-vaping campaign). Why did the commercial help change your Behaviors?

Answer: Examples of PSA commercials that have changed the student’s life could include one of the following examples. Students' responses to these examples could be used if students are unable to come up with their own life changing commercial examples.

Some ideas are below: Driving and Texting PSA: https://www.youtube.com/watch?v=rClJW9gnchc Anti-Smoking PSA: https://www.youtube.com/watch?v=Yk8ne92izUg Vaping is an Epidemic: https://www.youtube.com/watch?v=zYuyS1Oq8gY 4. To what extent are your personally concerned about pollution issues as they relate to the ocean and its ecosystem? Explain why.

Answer:

The responses here will vary, but hopefully, students are concerned and can explain why. Regardless, they should be able to defend their position. The cases details several issues that can be used to spark critical thinking on this important issue.

Case 4-1 | Housing Options: Big Decision - Big Risk Questions 1. Among the different consumer decision making approaches, how would you describe the decision that Maya has to make? What are the financial and non-financial risks associated with it? Please explain thoroughly.

From a decision approach viewpoint, hers would fit the realm of extended decision making. In this case, her decision process is rather lengthy since she has more than six months to finalize the purchase. Given her discussions and engagement with family, friends, online sites, etc. this would be a high-involvement purchase for her, and she seems to be thorough in solving her housing problem.

The financial risks are those associated with borrowing funds from family and banks to make the down payments, closing costs, and the monthly mortgage/interest payments. Once she signs on the dotted line, there is no going back, and she has to keep up with the payments. A related financial risk is the opportunity cost of those funds. What other purchases/investments alternatives could she have made with these funds?

Given her career trajectory in the medical field, it is not likely to happen but there is always a risk of defaulting on the financial obligations. Other longer term financial risks include unpredictable expenses, accidents or natural events that affect her cash-flow and those not covered by the homeowners insurance policy. Finally, the locale or the type of house she buys might lose value.

Non-financial risks include the worry about paying back her parents for the funds borrowed, the anxiety related to keeping the house tidy/clean both inside and its surroundings, making sure things are in working order, limits to her freedom and flexibility for moving to another job or another city, etc.

2. Which perspective on consumer decision making is represented by Maya’s situation? Is it possible that her decision transcends multiple perspectives? Please explain thoroughly.

Given Maya’s behaviors as described, it would fit the rational decision-making perspective. In this case, she is diligent about the whole process gathering valuable information from online and off-line sources. She had been comparing various locales, realtors, and mortgage options in order to make an informed decision. She is behaving in a rational manner and looking at the process with the expected value in mind.

While Maya’s decision is generally rational in nature, there might be other approaches that could be in play here. Given her insistence to find a lower price mortgage, one you attribute n economic perspective to her situation. Although, is it not mentioned, house buying definitely has an experiential/emotional angle to it? As Maya visits many houses, she is likely to find one that “feels like home.” Thus, there could be a focus on the hedonic value since she might look for the comforts of the homes, she grew up in.

It is also likely, that she could bring her family to the property she selects to get their opinion before she finally signs the papers. If this is the case, then the behavioral perspective could be in play.

3. What types of search behaviors are being exhibited in the case? Discuss this with regard to internal vs. external search, amount of search, etc. Please explain thoroughly.

Home buying as described in this case touches on all categories of search: ongoing, prepurchase, internal, and external.

Maya has been and will continue to search for various aspects of house buying for a length of time and she is likely to do this both passively and actively to stay up to date with the process.

She is also involved in prepurchase search since she is using all the information, she gathers in order to reach a decision for her house buying problem.

Her own memory and internalized experiences living in various homes while growing up is likely to inform her decision with respect to her new house. This might include various criteria that is acceptable to her, how she felt about her room, the gathering with family/friends, etc. The external search includes various sources of information as mentioned in the case – her parents, parents’ friends, her friends, online sites, realtors, etc. They are also likely to feature prominently in her decision-making process.

5. List and explain the various evaluative criteria the customer is utilizing in her decision making.

Is her criteria selection influenced by other factors? Does she have a determinant criterion for buying a house? Please explain thoroughly.

As explained in the chapter, evaluative criteria are product/service attributes that consumers consider when judging alternative solutions to solving a problem. These evaluative criteria could be: A feature – a property or the characteristic of the house such as size of the kitchen or having a 2-car garage vs. a 3-car garage.

A benefit – a perceived value derived from features of the house. So, a bigger kitchen means lots of room for Maya to cook and entertain her family and friends. A 3-car garage could provide extra room for her to store stuff, such as an additional refrigerator, etc.

Some of the criteria Maya is considering seems to be influenced by her own experiences while growing up – she does not want a big house with a large footprint, she wants a bigger bedroom, she would like to have space for a media room / theater, etc. There are others based on what she has learned from external sources such as her parents and friends. These might include proximity to the highway to access her work daily, timing of the decision since the mortgages rates are low, etc.

The case does not indicate one particular determinant criterion for buying the house although there could be several – location of the house, access to the highway and to shops/restaurants, footprint, size of the various rooms in the house, mortgage rates, etc.

6. Which of the decision rules is Maya applying in her decision-making process? Please explain thoroughly.

Maya is most certainly applying the attribute-based decision-making approach in which she is evaluating the properties across a set of attributes/features/benefits that she considers relevant to her decision making. The case provides information about how she is evaluating various options in terms of her buying decision. Although not clearly stated, it seems that Maya is using a non-compensatory model of decision making involving specific guidelines she set before the evaluation process. She is likely to eliminate properties that does not meet the optimal criteria such as having a big kitchen area.

Beyond these aspects, the case does not delve into the specific type of non-compensatory model (conjunctive, disjunctive, lexicographic, elimination by aspects) that Maya is likely to use since she is just beginning the alternative evaluation stage.

7. Are the various stages of the consumer decision making process represented in the case? If you were to step into Maya’s shoes, how would you complete the buying process? Please explain thoroughly.

The stages in consumer decision making are as follows: Need recognition: In this case Maya has recognized the need to move from an apartment to buying a house for various reasons. While apartment living had its benefits, she grew up in her parents house and felt nostalgic to have something similar and thus she began her journey to look for houses.

Search for information: As the case details, Maya has memory of her growing up in various houses with her parents and has also begun paying attention to external sources of information such as what her family and friends say about house buying and living in one.

Another element of her external information search is reviewing information online.

Evaluation of alternatives: While there not much information in the case about her exact process, Maya has begun evaluating some of the home features along with mortgage options. In most cases she seems to be using an attribute-based and non-compensatory alternative evaluation process.

As the case mentions, she is still in the alternative evaluation process since she still has to select a real estate agent and begin visiting open houses to research her options.

Completing the customer journey: As mentioned above, Maya is set to select an agent and visit open houses. If I were stepping into her shoes, I would do the same by developing a list of questions/criteria for a selecting an agent. For better customer service, I would then call some of the local agents, meet with them and ask them nearly the same set of questions in order to evaluate and select one agent. Once that is done, I would try to educate her/him on my needs, wants and preferences with respect to the property. The agent can then select properties and open houses that meet my criteria and show them to me.

Choice/purchase: After going over, taking pictures, and writing notes about each of the properties I visit as part of my consideration set, I’ll will get guidance from the agent, my parents, and friends to narrow it down to a couple of houses. At this stage, I’ll involve my parents and close friends to visit the two properties with me with the hope of obtaining additional information about both the properties. It is likely, that I will not find everything I need in a house and thus I might have to employ a compensatory decision heuristic to select one based on which property has most of what I am looking for. Of course, I’ll insist on home inspection to ensure the quality of my purchase and possible modifications to be made.

I will discuss the price with those involved and try to get the agent to negotiate on the bottom-line price. At this point, if everything is good, I might not haggle much on a few dollars either way. With the agent in the know, I would have been discussing the situation with my Costco-sponsored mortgage company and eventually make arrangements to close the deal.

Post choice evaluation: Having bought my first house, I’ll make arrangements to move depending on my apartment lease situation. If I have a month or so remaining on the lease, I’ll have time to made needed modifications on the house and slowly move my items in. Of course, I’ll seeking help from family and friends for this purpose. At the same time, I’ll be trying to decorate the house in a way I see fit with my parents’ guidance.

Once I am satisfied with the décor and the repairs, if any, I’ll be ready to host the housewarming party!!

Case 4-2: Is Cash Really King?

Answers 1. How do you see retailers both large and small adopting or failing to adopt cashless retail?

Answer:

Students should be encouraged to look at the National Retail Federation data on ecommerce trends. Since the pandemic and nationwide cash shortage, many retailers have encourage the use of exact change or the use of credit cards.

2. To what extent do you believe that the COVID-19 pandemic of 2020 affected consumer attitudes toward the use of cash?

Answer: COVID protocols and ecommerce has changed the reliance on cash. For almost two years consumers have relied on using cashless transactions and cash apps for quick payment. Student responses will vary, but most students will notice that case is being used less and less, and that this was impacted by the pandemic.

3. In what other ways do you think consumer behavior was affected by the COVID-19 pandemic?

Answer: Consumer behavior has shifted from bricks and mortar to ecommerce. The NRF publishes a study of ecommerce retail sales which continue to grow year after year. Not only has ecommerce grown but Statista published a dossier on social commerce which is expected to reach $79 billion by 2025. There’s more sales happening on social media platforms such as Facebook, Instagram and YouTube. Social media influencers have a 53% impact on the product we purchase from “word of mouth.”

4. What are your opinions on cashless retail? Do you prefer it? Why or why not? Do you think it will continue to grow in popularity?

Answer:

Answers will vary. This is a question to get students to share how they consume and purchase goods and services. There’s no wrong answer to their consumption patterns. Take a poll to explore which cash apps are most popular: Zelle, Vemo, Paypal, etc. https://money.usnews.com/money/personal-finance/saving-andbudgeting/articles/the-best-payment-apps

Case 4-3: Consumer Decision Making During a Pandemic 1. Think about a time when you were stressed and out of control, and even feared death.

Under those feelings, did you find yourself sticking with your favorite brand? Or did you try something new that gave you feelings of excitement and control?

Answer: The responses will vary greatly. For many students, when recalling 2020, many students will remember sticking to “tried and true” products and brands. Unless there was a shortage or anything, many will have purchased “go-to” brands. That is because they probably wouldn’t have wanted to any additional risk other than COVID by choosing different product or brand.

2. According to terror management theory, you can use two coping strategies in order for you to reduce your anxiety and fear: defending your worldview and/or bolstering your self-esteem. In which way do you believe you can defend your worldview? Are there any cultural aspects that you believe it is important to protect?

Answer: Again, responses will vary. For some students, they might defend their worldview by supporting racial and ethnic groups. Their observations at the time could be related

to this Many people were expressing favoritism on their own in-groups by engaging in protests or supporting certain ethnic group-owned businesses. Students would work to bolster esteem by focusing on the own group memberships. This would vary across cultures. Students may also respond with issues pertaining to inclusivity and diversity as well.

3. In what ways can you bolster your self-esteem? What are the areas that can give you the sense that you are valuable and lovable? Who are the people that can help you to heightened your self-esteem?

Answer: Once again, responses will vary greatly. During Covid, many students may have called and talked with my family more than before the pandemic. They may have checked in much more than usual. This could also have brought about a sense of comfort and a feeling of being loved. According to TMT, this would allow them to bolster self-esteem through family. Family members, friends, and even college faculty can help students to bolster their esteem.

CB 9 Part 5 Case 5-1 | Satisfied Customers: Competitive Asset or Liability?

Questions 1. Which of the theories of post-consumption reaction can be applied to the restaurant experience? Please explain thoroughly.

The expectation/disconfirmation theory suits this situation because restaurant guests utilize their expectations (from previous visits or from word-of-mouth/social media reviews before their first visit) to set their mental standards or benchmarks. They then compare the restaurant performance/experience with those benchmarks in order to arrive at a conclusion. Based on the information in the case, it would seem that there is positive disconfirmation among the guests since the restaurant performance/experience exceed their expectations.

Attribution theory also plays a part in post consumption reactions with respect to Forkz ‘n Spoonz. In this case, the restaurant guests might attribute their elevated consumption experience to specific actions that take place in the restaurant. These actions might include interactions/engagement with the waitstaff, offering of freebies for great suggestions, earning dining points, etc.

A modified equity theory approach can also be utilized since guests might be able to compare Forkz ‘n Spoonz level of effort in pleasing them to that of another comparable restaurant.

2. How can Stephanie measure satisfaction among guests who visit the restaurant on a regular basis?

Some programs Stephanie implemented to satisfy the regulars include  Consistency in service interactions.  Varying the service encounters for regulars who come in with high expectations.  Getting the waitstaff to know them beyond names, greeting them at the door, engaging with them at least 3 times  Offering freebies for great suggestions/comments/complaints, etc. & prizes for the best ones.  Dining points beginning with their second visit.  Engaging with them on social media.

Gathering valuable from ongoing guest interactions in the restaurant, guest satisfaction surveys, analyzing their experience sentiment on social media are good ways of continually measuring guest satisfaction.

3. What types of switching costs should the restaurant chain be concerned about? Please explain thoroughly.

Restaurant switching and related cost could be attributed to  Unfair treatment (not a likely scenario at this Forkz ‘n Spoonz)  Unfair prices (no information regarding prices provided in this case)  Procedural costs (time and effort to establish another routine at a different restaurant)  Financial costs (having to drive to another restaurant, deciding on menu options and their value)  Relational costs (having to leave the emotional relationships with Forkz ‘n Spoonz waitstaff and find newer relationships)  Customer acquisition costs (having to acquire newer guests at a higher cost compared to keeping existing guests)  Opportunity costs (expending resources on newer guests that could have been used for other purposes)

4. Given your experiences in restaurants, do you think Stephanie can transfer her guest service experiment to other restaurants within the chain? Why or why not?

This is a tough question to answer. Firstly, I have only worked at one restaurant within a chain and thus I am not in a position to compare one franchise to another. Secondly, I feel that even with a chain, each franchise tends to develop their own culture and style in dealing with customers based on the specific group of waitstaff, cooks, and managers – beyond corporate policies regarding guest interactions. In many instances, each franchise manager seems to have some leeway to try and establish their own policies depending on the location, clientele, etc.

So, transferring what works in one location to another, although not impossible, is unlikely to be effective. But great programs are worth repeating in other stores.

5. Which of the characteristics of relationship quality did the Forkz ’n Spoonz (store #103) exhibit in the case? Please explain thoroughly.

While there are many characteristics of relationship quality, the following seems to apply to Forkz ‘n Spoonz.      

Competence: Thanks to extensive training the waitstaff in the restaurant seem to be competent in their work. They are knowledgeable about the restaurant menu and policies when dealing with guests.

Trust: Their interactions with customers both in the restaurant (minimum 3 engagements in the restaurant) and on social media seem to contribute to their guest developing trust in them and their menu suggestions.

Equity: While not explicitly mentioned in the case, many guests seem to be returning to the restaurant with some level of loyalty. Of course, their service experience is great but that alone might not be sufficient if the food is not of good value.

Communication: This is one are that the waitstaff at Forkz ‘n Spoonz seem to excel in. They interact and engage with the guest on several occasions both in the restaurant and on social media.

Customization: While there is no information regarding offering guest customized options in the restaurant, it is possible to view the restaurant policies regarding offering dining points, freebies, etc. as possible customization.

Good customer-oriented policies and personnel: Stephanie’s experiences at Minnie’s and later at Forks ‘n Spoonz have resulted in various customer centric policies at the restaurant.

She trains her waitstaff in order to maintain guest centric policies such as consistency in service interactions; varying the service encounters for regulars who come in with high expectations; getting to know them beyond names, greeting them at the door, engaging with them at least 3 times; offering freebies for great suggestions/comments/complaints, etc. & prizes for the best ones; dining points beginning with their second visit; engaging with them on social media, etc.

6. If guest experience, loyalty and referrals are the keys to F&S success in the long run, can local advertising (on TV, billboards, magazines) be completely eliminated? Why or why not? Please explain thoroughly.

While it might be theoretically possible to eliminate local advertising given the success of guest loyalty and word-of-mouth programs, it might not be a good strategy in the long run. Albeit costing more to acquire new guests through local advertising, the media play does have a place in the marketing mix for the restaurant. Forkz ‘n Spoonz would need local advertising for a few reasons: 1. Existing loyal customers might stop visiting the restaurant for many personal reasons such as moving away from the neighborhood, health related issues, availability of newer and competing restaurants & offerings, etc.

2. In the long run, the restaurant needs to bring in newer guests in order to build a large customer base to replace those who leave for various reasons.

3. Forkz ‘n Spoonz also needs a bigger customer base from which to develop loyal guests for the future.

Case 5-2 Susan G. Komen for the Cure: Can This Relationship Be Saved?

1.

How did social media impact the complaining behaviors of donors and participants for Susan G. Komen for the Cure activities? What types of complaining behaviors were most apparent?

Answer: The social media backlash was quick as people began posting criticism on the decision to fund Planned Parenthood on their Facebook pages and in their Twitter accounts.

The huge outcry was reported in traditional media, mainly newspapers and television news, as well as through online news sources, such as The Huffington Post. Opponents of the decision spontaneously began donating money to Planned Parenthood within the first 48 hours of the story breaking. Susan G. Komen for the Cure received negative word-of-mouth (WOM), negative public publicity, and switching behavior, all before they responded to the complaining behavior or reversed their decision.

2.

What was the response by Susan G. Komen for the Cure to negative public publicity after their decision to stop funding mammograms in partnership with Planned Parenthood?

Would you have responded differently had you been in charge?

Answer: The Komen organization did not make a formal announcement about the decision, and they did not contact corporate sponsors in advance. Once the story broke in late

January, they did not respond to the story for four days. This allowed the negative word-of-mouth (WOM) and the resulting publicity to reach many of their supporters without telling their side of the story. The lack of response infuriated the former Komen supporters, who felt their concerns were being ignored. After four days, Komen founder Nancy Brinker announced that the organization was backing off of the decision. This was not enough to alleviate the anger of the former supporters. A few days later, the Sr. Vice President of Political Affairs also resigned, but with comments that did not acknowledge the controversial nature of the decision. Because Komen did not respond quickly, they found themselves reacting rather than acting.

In sports terms, they were forced to play “defense” rather than “offense” and thus delayed any recovery that could have occurred. Most customer-oriented organizations would have tried to gauge the reaction of supporters before the decision was made rather than assuming the organization understood the feelings and attitudes of their supporters.

3.

Officials at Susan G. Komen for the Cure seemed unprepared for the intensity of response that they encountered. How would an understanding of the difference between customer loyalty and customer inertia have prepared the Komen officials for the reactions they experienced?

Answer: Most nonprofit organizations assume that people who donate time or money regularly are more loyal to the organization than those who participate sporadically. Customer inertia occurs when people continue a pattern of behavior until some stronger force motivates them to change. Komen and Planned Parenthood are in the position of two people who share the same friend. One friend may have deeper ties than the other: a longer relationship, more frequent contact, or even more similar views and values.

Komen did not understand that some supporters’ loyalty to Planned Parenthood was the primary relationship, and their support for Komen was weaker than they expected. Thus, the supporters felt their contributions to Komen produced something of value, but their contributions to Planned Parenthood were even more important.

In the aftermath of new information, once supporters revised their opinions of Komen’s value, it is hard to go back to the previous attitudes. Thus, what appeared to be customer loyalty was in fact only customer inertia.

4.

Does the Komen organization demonstrate characteristics of relationship loyalty with their donors? Why, or why not?

Answer:

The characteristics of relationship quality are competency, communication, trust, equity, personalization, and customer orientation. Following the unpopular decision to defund Planned Parenthood grants, Komen supporters were exposed to attacks on the competence of the Komen organization, such as information about where the money was used. The delay in responding to criticism eroded both the communication and trust elements of the relationship. Some contributors also questioned the equity of the relationship when their criticisms and concerns seemed to be ignored. Komen still has the opportunity to personalize the relationship since participants contribute in the name of someone affected by breast cancer. And, while Komen demonstrated a lack of customer orientation with a decision that was so “out of step” with their supporters, the use of public relations consultants and customer research indicates a desire to become more customer-oriented in the future.

5.

Many Komen supporters switched their donations to Planned Parenthood after the negative public publicity. Use the concept of share of wallet to explain why this might have happened.

Answer: Most individuals have a limited amount of disposable income that they give to causes and charities. They distribute their charitable donations to causes that are most important, most salient, or closest to the benefits they value. If the same supporters were donating to both the Komen organization and Planned Parenthood because both causes benefited women, any change in the amount given to one will necessarily reduce the amount of money available to the other organization. When supporters felt Planned Parenthood was threatened, and at the same time were exposed to negative information about Komen, the share of wallet increased for Planned Parenthood, reducing or excluding the share of wallet available for Komen.

Case 5-3 Wise or Weaponry: Consumer Targeting Through Psychographic Data Analytics Questions 1. Even if Facebook or other information providers don’t break laws in sharing data, do they break a moral or ethical law in doing so?

Answer

Answers will vary. Interestingly, most Gen Z and younger who have been presented with this case study by the author say that they expect that companies will use their data and they generally find nothing wrong with it.

2. Within about 10 years’ time, consumers will have about 70,000 data points defining them, currently with no control over that at all. Does this worry you? Explain your answer.

Answer Answers will vary. Students in courses taught by the case study author have found nothing wrong with this.

3. As individuals we can limit the data we leak, but there’s no way to completely get off the grid.

Find the data and privacy information for one app on your phone or handheld device. What types of data does the app collect and for what purpose? Will you continue to use this app or will you delete it based on what you learned?

Answer Answers will vary. Students tend to research the data use and privacy policies for Instagram and other social media apps. They generally do not plan to discontinue using the apps, in spite of some documentation stating that the app has access to their text messages, pictures, and audio.

4. What rights should consumers have with regard to their data?

Answer Consumers should be able to request from companies what data they are collecting and to also request from the company what specific data the company has for him/her. Finally consumers should be able to request that all data about them be deleted from company systems, if they so wish.

5. Search the congressional database for bills related to data privacy and protection. Read one of them and summarize what it says. Search the database for bills introduced and their status at https://www.congress.gov/search.

Answer Answers will vary. This is a great question for classroom discussion as well.

6. Some say that data is the most valuable asset on earth. Why do you think this is being said?

Answer Data is a commodity that companies are willing to pay a big price to get.

Companies like Acxiom collect hundreds, if not thousands, of data points about

consumers enabling companies to target their advertising to precise audiences.

Precise targeting eliminates advertising spend waste by aiming their messaging at the right audience most likely to buy their products.

7. Which consumer behavior theories, principles, and concepts do you recognize in this case study?

Answer Answers will vary. Segmentation, targeting, and positioning (STP) is evident in this case study, as is stealth marketing, and marketing ethics.