Consumer Behavior Buying, Having, Being, 14th edition Michael R Solomon Instructor Manual

Consumer Behavior Instructor's Manual Patricia Buhler Consumer Behavior Buying, Having, and Being Fourteenth Edition

Michael R. Solomon Cristel Antonia Russell

Chapter 1: Buying, Having, and Being: An Introduction to Consumer Behavior

Chapter 1: BUYING, HAVING, AND BEING: AN INTRODUCTION TO CONSUMER BEHAVIOR CHAPTER OBJECTIVES When students finish this chapter, they should be able to: 1-1. Summarize how the consumption of goods, services, experiences, and ideas is a major part of our lives.

1-2. Identify and discuss the technological and sociocultural trends that require constant monitoring to understand consumer behavior.

1-3. Explain how consumption both contributes to the world’s problems and provides solutions.

1-4. Describe how many disciplines and perspectives inform our understanding of consumer behavior.

CHAPTER SUMMARY Summarize how the consumption of goods, services, experiences, and ideas is a major part of our lives.

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 and desires and to define and express their identities. The items we consume include anything from canned peas to a massage, democracy, Juicy jeans, a virtual reality experience, K-pop music, or a celebrity like Taylor Swift. The needs and desires we satisfy range from hunger and thirst to love, status, and even spiritual fulfillment. Consumption refers to all facets of the consumer behavior process, which includes how we observe and make sense of the world around us, how we choose and purchase things, and how we use consumption to communicate our identity and our sense of self in society.

One of the fundamental premises of the modern field of consumer behavior is that people buy products not for what they do but for what they mean. This principle does not imply that a product’s basic function is unimportant but rather that the roles products (and services) play in our lives extend well beyond the tasks they perform. Our consumption choices help us define our identity. Identity is a multilayered concept that involves our personal self and our social self.

Identify and discuss the technological and sociocultural trends that require constant monitoring to understand consumer behavior.

There’s little doubt that the digital revolution is one of the most significant influences on consumer behavior, and the impact of the internet will continue to expand as more and more people around the world log in. Communications no longer just flow top-down from companies and established media to passive recipients (consumers). Today, they also flow across regular users. Social media refers to the online means of communication, conveyance, collaboration, and cultivation among interconnected and interdependent networks of people, communities, and organizations enhanced by technological capabilities and mobility. Every day the influence of social media expands as more people join online communities. As part of our online activity, we are all generating massive amounts of information that hold tremendous value for marketers, especially as our devices .

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Chapter 1: Buying, Having, and Being: An Introduction to Consumer Behavior

increasingly connect to one another as part of the Internet of Things (IoT). The collection and analysis of extremely large datasets is called Big Data. This data explosion is profoundly changing the way we think about consumer behavior. Companies, nonprofits, political parties, and even governments sift through massive quantities of information that enable them to make precise predictions about what products we will buy, what charities we will donate to, what candidates we will vote for, and what levers they need to push to make this even more likely to happen. The metaverse describes an environment we will very possibly inhabit in the near future, where activities in the physical and digital worlds are integrated into an immersive user experience.

Increasingly the content we encounter is from brands that have become a part of global culture.

Understanding consumer behavior means staying on top of consumer trends. Important trends include the sharing economy, diversity and multiculturalism, authenticity, and sustainability.

Explain how consumption both contributes to the world’s problems and provides solutions.

Many critics argue that consumption is the source of many of the world’s problems: growing mental and physical health problems, climate change, addiction, and other issues that threaten our quality of life as individuals and as a society. They claim that modern marketing practices make these problems worse because they create unhealthy needs that people then try to satisfy. It’s just as easy to argue that consumption can also be the source of solutions to a better world. A greener planet will require that consumers make better, more environmentally sound choices. Solving the housing crisis will likely involve creative solutions to home ownership and a greater variety of housing options.

For businesses also, responsible marketing is about merging consumer centricity, a focus on meeting consumers’ needs, with making a positive impact on our communities—both in the small sense (local communities) and in the broad sense (our planet).

Describe how many disciplines and perspectives inform our understanding of consumer behavior.

Many different perspectives shape the field of consumer research. You can find people with training in a wide range of disciplines—from neuroscience to anthropology—doing consumer research. Universities, manufacturers, museums, advertising agencies, and governments employ consumer researchers.

CHAPTER OUTLINE I. Consumer Behavior: People in the Marketplace A. What Is Consumer Behavior?

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 and desires to define and express their identities. a. Consumption Is a Process. a. Consumer behavior is an ongoing process, not merely what happens at the moment a consumer hands over money or a credit card and in turn receives some good or service. b. Consumption refers to all facets of the consumer behavior process, which include how we observe and make sense of the world around us, how we .

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Chapter 1: Buying, Having, and Being: An Introduction to Consumer Behavior

choose and purchase things, and how we use consumption to communicate our identity and our sense of self in society. b. What Does It Mean to Consume? a. People buy products not for what they do, but what they mean. The roles products (and services) play in our lives extend well beyond the tasks they perform. All things being equal, we choose the brand that has an image consistent with our underlying needs and desires and aligned with our identity. b. Identity is a multilayered concept that involves our personal self and our social self.

B. A Branded World A brand enables consumers to identify a particular company, product, or individual.

It uses identifying markers to tell potential buyers not only what it does but also what it means and perhaps even the cultural values it stands for.

C. Understanding Consumers Is Good Business a. The bottom line for managers, advertisers, and other marketing professionals: Understanding consumer behavior is good business. Organizations exist to satisfy needs, and marketers can satisfy these needs only to the extent that they understand the people or organizations that will use the products and services they sell. b. Successful companies understand that needs are a moving target.

Use Chapter Objective 1-1 Here Use Key Terms consumer behavior, consumption, identity, and brand Here Use Review Questions 1-1 and 1-5 Here Use Consumer Behavior Challenge 1-12, 1-13, and 1-14 Here

II. Consumers, Society, and Technology: A Moving Target The United Nations defines a megacity as a metropolitan area with a total population of more than 10 million people. It is estimated that by 2030, three out of five people will live in cities.

A. Social Media: The Horizontal Revolution a. Word of mouth has always been a major force, but the explosion of social media takes “word of mouth” to a whole new level because it has created a horizontal revolution: Communications no longer just flow top-down from companies and established media to passive recipients (consumers). Today, they also flow across regular users. b. Social media refers to the online means of communication, conveyance, collaboration, and cultivation among interconnected and interdependent networks of people, communities, and organizations enhanced by technological capabilities and mobility. Today, some people wear tiny cameras that allow them to create a lifelog of every event experienced throughout the day. c. The term digital native originated in 2001 to explain a new type of student. These consumers grew up “wired” in a highly networked, always-on world. They did not know a world without digital technology.

B. Artificial Intelligence and the Metaverse .

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a. The Internet of Things (IoT) refers to the growing network of interconnected devices embedded in objects that speak to one another. b. Autonomous vehicles (self-driving cars) and “smart home” products are examples of IoT. c. We are witnessing a revolution in M2M (machine-to-machine) communication. d. Artificial intelligence (AI) applications continuously improve through machine learning (such as Siri and Alexa).

C. “Big Data” and Data Analytics a. We are all generating massive amounts of information that hold tremendous value for marketers. b. The collection and analysis of extremely large datasets is called Big Data. c. In addition to the huge volume of information marketers now must play with, its velocity (speed) also enables companies to make decisions in real-time that used to take months or years.

D. Welcome to the Metaverse! a. Most definitions of the metaverse center on these elements: a. It exists in the physical world, but it also involves immersive environments. b. It’s “always on” and operates in real-time. c. It’s built on a virtual economy, including nonfungible tokens (NFTs), which are digital assets with unique identification codes and metadata that distinguish them from one another. d. It allows people to possess virtual identities that don’t necessarily correspond to who they are in real life.

E. Globalization of Brands and Cultural Practices a. In this world of increasing global mobility, two countervailing forces drive consumer behavior: the desire to belong and the drive for cultural distinctiveness, the feeling of being different and separated from the surrounding cultural environment. On the one end, consumers have a natural in-group bias: They prefer culturally related brands that meet their desire to connect with “home” and their home culture. But on the other end, consumers can feel a sense of cultural distinctiveness that drives them to seek out brands that represent other cultural groups.

F. Proactive Consumers and User-Generated Content Probably the biggest phenomenon of the 21st century is the degree to which consumers want organizations to market with them rather than market to them.

1.UGC Rules! a. User-generated content, where everyday people film commercials, voice their opinions about products, brands, and companies on blogs, podcasts, and social networking sites, is part of the Web 2.0 era, which shifted the Internet from a one-way transmission medium to a social, interactive medium.

2. Consumer Creation in the Transmedia Environment a. An important development in the consumer ecosystem is the shift from traditional media to the more integrated system called transmedia, which refers to the web of media from traditional media platforms, like magazines and television, to more novel and emergent ones, like digital media, video games, and the metaverse. b. Transmedia challenges traditional views of popular culture – the music, movies, sports, books, celebrities, and other forms of entertainment that the mass market .

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produces and consumes – because we can access these forms of entertainment in so many ways and in so many forms. c. Marketing messages are communicated synchronously through transmedia in the form of transmedia storytelling, which refers to telling a story across multiple platforms and formats. Consumers access brand and marketing messages synchronously across transmedia, and this variety of contact points allows them to engage with content in such a variety of ways that it amounts to a make-your-ownjourney.

G. Consumer Trends: Keeping Up with the Culture That Won’t Stand Still 1. Consumer trends refers to the underlying values that drive consumers toward certain products/services and away from others.

2. A brand that aligns with a dominant value stands a much better chance of success.

3. Important trends that will impact marketing strategies in the near future include: a. Sharing economy b. Authenticity and personalization c. Blurring of gender roles d. Diversity and multiculturalism e. Social shopping f. Income inequality g. Healthy and ethical living h. Simplification i. Interconnection and the IoT j. Anonymity

Use Chapter Objective 1-2 Here Use Key Terms megacity, revolution, social media, lifelog, digital native, the Internet of Things, autonomous vehicle, machine-to-machine, artificial intelligence, machine learning, Big Data, metaverse, nonfungible tokens (NFTs), cultural distinctiveness, in-group bias, usergenerated content, Web 2.0, transmedia, popular culture, transmedia storytelling, contact points, and consumer trends Here Use Review Questions 1-2 and 1-3 Here Use Consumer Behavior Challenge 1-6, 1-10, and 1-15 Here

III. Consumption: From Problem to Solution?

A. What Do We Need – Really? a. A survey found that happiness is linked to satisfying wants and needs, whereas meaningfulness relates to activities that express oneself and impact others in a positive way. The distinction between a “happy” and a “meaningful” life brings up an important question: What s the difference between needing something and wanting it? b. A need is something a person must have to live or achieve a goal. c. A want is a specific manifestation of a need that personal and cultural .

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factors determine.

B. Toward Responsible Consumption and Responsible Business a. Responsible marketing is about merging consumer centricity, a focus on meeting consumers’ needs, with making a positive impact on our communities – both in the small sense (local communities) and in the broad sense (our planet).

Use Chapter Objective 1-3 Here Use Key Terms need, want, responsible marketing, and consumer centricity Here Use Consumer Behavior Challenges 1-7, 1-8, 1-9, and 1-11 Here

IV. Multiple Perspectives on the Study of Consumer Behavior A. What Disciplines Study Consumer Behavior?

Many different perspectives shape the field of consumer research. a. A Micro Focus On the micro side, we find researchers who understand the brain and its inherent processes. Foundation for these perspectives come from the following disciplines: a. Cognitive psychology: This discipline focuses on the study of internal mental processes. b. Neuroscience: This discipline focuses more deeply inside the brain and nervous system. c. Judgment and decision making (JDM): This discipline studies all the complexities of human judgments and decisions. d. Behavioral economics: This branch of economics extends from classical and neoclassical economics and integrates insights from psychology. e. Social psychology: This branch of psychology focuses on the social factors that affect individual or group behavior. b. A Macro Focus On the macro side, we find researchers who regard consumption from a social and cultural point of view, drawing on sociology and anthropology. a. Sociology: This discipline focuses on the study of group behavior. b. Anthropology: This discipline comparatively examines culture, society, and human differences from the perspective of the individual embedded in a collective.

Other disciplines that inform consumer research include: c. Semiotics and literary criticism: Semiotics, the study of meanings and symbols, and literary criticism, the systematic and organized analysis and evaluation of texts, offer tools to deconstruct and extract the meanings inside ads, social media posts, and even entire marketing campaigns. d. Computer science: Computer science is the study of computers and computational systems to understand consumer behavior. e. History: This discipline studies the past and critically examines these source materials to assess consumption trends over time and the factors that shape them. .

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B. Where Do We Find Consumer Researchers? a. Just about anywhere we find consumers, we are likely to find consumer researchers.

They work for manufacturers, retailers, marketing research firms, governments, nonprofit organizations, and colleges and universities.

C. The Philosophy of this Book Understanding complex real-world consumption phenomena requires a plurality of methods and theoretical approaches – and hence the multidisciplinary nature of the study of consumer behavior.

Insights from multiple paradigms, which refer to ways of thinking about and studying a phenomenon are woven into insights in each chapter.

Use Chapter Objective 1-4 Here Use Key Terms cognitive psychology, neuroscience, judgment and decision making (JDM), behavioral economics, social psychology, sociology, anthropology, semiotics and literary criticism, computer science, history, and paradigms Here Use Review Question 1-4 Here

End-of-Chapter Support Material

REVIEW QUESTIONS 1-1. Provide a definition of consumer behavior.

It 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 and desires to define and express their identities. (1 minute, Chapter Objective 1-1, AACSB: Application of Knowledge) 1-2. What is “Big Data”?

Big data refers to the collection and analysis of extremely large datasets. For example, Macy’s used GPS phone signals from Macy’s parking lots on Black Friday to estimate whether the department store would meet its sales projections for that day. (1 minute, Chapter Objective 1-2, AACSB: Information Technology) 1-3. What is popular culture, and how does this concept relate to marketing and consumer behavior?

Popular culture, consisting of the music, movies, sports, books, celebrities, and other forms .

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of entertainment consumed by the mass market, is both a product of and an inspiration for marketers. Our lives are also affected in more far-reaching ways, ranging from how we acknowledge cultural events such as marriage, death, or holidays to how we view social issues such as air pollution, gambling, and addictions. (1 minute, Chapter Objective 1-2, AACSB: Reflective Thinking) 1-4. Name two different disciplines that study consumer behavior. How would their approaches to the same issue differ?

Two disciplines that study consumer behavior are cognitive psychology and sociology.

Cognitive psychologists study consumer behavior from a mental / brain information processing perspective while sociologists study consumer behavior from a group behavior perspective. (1.5 minutes, Chapter Objective 1-4, AACSB: Application of Knowledge) 1-5. This chapter states “people often buy products not for what they do but for what they mean.” Explain the meaning of this statement and provide an example.

The roles products (and services) play in our lives extend well beyond the tasks they perform. All things being equal, we choose the brand that has an image consistent with our underlying needs and desires and aligned with our identity. One example of this is Peeps candy. These marshmallow products have no nutritional value but have a group of devotees that use Peeps in decorations, slide shows, and sculptures. The Peeps brand has created nostalgic attachment as this brand has an image or personality consistent with the underlying needs of the consumer. (5 minutes, Chapter Objective 1-1, AACSB: Reflective Thinking)

CONSUMER BEHAVIOR CHALLENGE Discuss 1-6. As consumers increasingly interact with one another in digital form, what are the ramifications for real-world human relationships?

This question is one students should find most interesting. The impacts on human relationships are truly unknown at this point; however, one could speculate that such digital interactions could lead to a decline in traditional human interactions, as humans become accustomed to new digital relationships. Students might explore why employers have warned of a lack of human skills in digital natives. Psychologists have also voiced concerns about the impact of digital relationships. Conversely, digital relationships may have a positive impact on human relationships if humans come to realize potential emotional shortcomings of some digital interactions. (5 minutes, Chapter Objective 1-2, AACSB: Reflective Thinking) 1-7. What aspects of consumer behavior would interest a financial planner? A university .

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administrator? A graphic arts designer? A social worker in a government agency? A nursing instructor?

The listing of the aspects of consumer behavior corresponding to these positions should reflect the particular aspects of each position. For example, a financial planner depends on consumers’ willingness to postpone consumption in order to save and invest money to have more later. A social worker must be concerned about people’s attitudes toward government, social work in general, and the role of government in people’s lives. What each of these positions share, and what should underlie the discussion, is their connection to the consumption process and the fact that consumers themselves will have different needs and wants associated with their consumption. Each of the listed parties would attempt to influence consumers by using a different aspect of consumption, and these differences need to be discussed and analyzed. (7 minutes, Chapter Objective 1-3, AACSB: Application of Knowledge and Reflective Thinking) 1-8. Critics of targeted marketing strategies argue that this practice is discriminatory and unfair, especially if such a strategy encourages a group of people to buy a product that may be injurious to them or that they cannot afford. For example, community leaders in largely minority neighborhoods have staged protests against billboards promoting beer or cigarettes in these areas. However, the Association of National Advertisers argues that banning targeted marketing constitutes censorship and thus is a violation of the First Amendment. What are your views regarding this issue?

It is important to guide discussion to the legitimate interests on both sides. In this situation, however, the discussion should also examine the legitimacy of each side’s basic point. For what groups should target marketing not be allowed? On the other hand, under what specific circumstances should target marketing be allowed? Is the argument that target marketing unduly influences those who cannot resist its appeal reasonable? Is the counterargument that banishing target marketing amounts to censorship and is unconstitutional equally specious? Discussion should initially focus on the validity of each argument and then evolve toward a compromise that will protect target-marketing efforts while recognizing the needs of society. (5 minutes, Chapter Objective 1-3, AACSB: Ethical Understanding and Reasoning) 1-9.

The chapter discussed a study that compared and contrasted people who lead “happy” lives versus those with “meaningful” lives. How does this distinction relate to the way you decide to spend your time and money? How does it relate to consumer behavior more generally?

Students should be able to differentiate between a want and a need. The discussion should identify how meaningfulness relates to activities that express personality and impact others in a positive way. Discussion should identify those who pursue happiness over meaningfulness as being takers rather than givers, and that they are more likely to think in the present instead of the past or future. Those who pursue meaningfulness would indicate the opposite. Worry, stress, and anxiety might also be associated with those who pursue happiness. (5 minutes, Chapter Objective 1-3, AACSB: Reflective thinking and application of knowledge) .

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1-10. A book bemoans the new wave of consumer-generated content, labeling it “the cult of the amateur.” It compares the social networking phenomenon to the old story about the monkeys: If you put an infinite number of monkeys in a room with an infinite number of typewriters, eventually they will (by hitting keys randomly) reproduce all the major works of literature. In other words, the large majority of user-generated content is at about the same level, and the future of professionally produced, quality work is in doubt. Do you agree or disagree with this assertion?

Students who are members of a social networking community or those who actively blog, might strongly defend the practice and might be offended by the monkey reference. Even though they might agree that there are many sites with ramblings, rants, and raves, they might also point out serious sites where user-generated content is thought provoking.

They might also mention instances where blogs check facts when the traditional media fails to do so. An example of this was a blogger proving that documents used by CBS News to discredit President Bush were forgeries.

Some students might also mention that not all “professionally produced” work can be labeled as “quality” work. Either students or the instructor could provide examples. It might also be beneficial to briefly discuss what “quality” means, who judges quality, and if this is a classic bias against the “new” by the older generation who prefers the traditional. (7 minutes, Chapter Objective 1-2, AACSB: Analytical Thinking) 1-11. A few years ago a publicity campaign for a late-night cartoon show backfired when it aroused fears of a terrorist attack and temporarily shut down the city of Boston. The effort consisted of one-foot-tall blinking electronic signs with hanging wires and batteries that marketers used to promote the Cartoon Network TV show Aqua Teen Hunger Force (a surreal series about a talking milkshake, a box of fries, and a meatball). The signs were placed on bridges and in other high-profile spots in several US cities. Most depicted a boxy, cartoon character giving passersby the finger. The bomb squads and other police personnel required to investigate the mysterious boxes cost the city of Boston more than $500,000— and a lot of frayed nerves. Is there a line between attention-getting publicity stunts and activities that should be illegal or forbidden?

This question should generate quite a discussion among students as they debate the limits they believe to be acceptable in gaining attention. Students might discuss responsible marketing and making a positive impact. The question becomes one of the greater good – Is it enough for a company to do whatever it can to promote a product, OR is there a greater good to consider, in this case the unfortunate frayed nerves of a city?

(5 minutes, Chapter Objective 1-3, AACSB: Reflective Thinking)

1-12. List the facets of the consumer behavior process referred to in consumption. Describe the issues that you considered in each of these facets when you made a recent important purchase.

Consumption refers to all facets of the consumer behavior process, which include how we .

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observe and make sense of the world around us, how we choose and purchase things, and how we use consumption to communicate our identity and our sense of self in society.

Individual student responses will vary. (15 Minutes, Chapter Objective 1-1, AACSB: Reflective Thinking) 1-13. This chapter states that people play different roles and that their consumption behaviors may differ depending on the particular role they are playing. State whether you agree or disagree with this statement, giving examples from your personal life. Try to construct a “stage set” for a role you play, specifying the props, costumes, and script that you use to play a role (e.g. job interviewee, conscientious student, party animal).

Our consumption choices help us define our identity. Identity is a multilayered concept that involves our personal self and our social self. (20 Minutes, Chapter Objective 1-1, AACSB: Reflective Thinking) Apply 1-14. Talk to car owners and probe to see what (if any) relationships they have with their vehicles. How are these relationships acted on? (Hint: see if any of the respondents give their cars a nickname, or if they “decorate” them with personal items.) To give you some additional insight, check out a YouTube video called I Love My Car! that originally aired on the TV show My Strange Addiction.

All things being equal, we choose the brand that has an image (or even a personality) consistent with our underlying needs and desires and aligned with our identity. The way we feel about ourselves and the things we like to do in our spare time all help to determine which products will push our buttons and even those that will make us feel better. They should also attempt to show how the consumption patterns that they engage in with their cars reflect these differences. (5 minutes, Chapter Objective 1-1, AACSB: Analytical Thinking and Reflective Thinking) 1-15. The specific way we choose to satisfy a need depends on our unique history, learning experiences, and cultural environment. For example, two classmates may feel their stomachs rumble during a lunchtime lecture. If neither person has eaten since the night before, the strength of their respective needs (hunger) would be about the same. However, the way each person goes about satisfying his need might be quite different. Conduct this exercise with classmates: “As you probably know, a prisoner who is sentenced to die traditionally gets to choose his or her ‘last meal’. If you had to do this (let’s hope not), describe your last meal in detail.” Compare the responses you get, especially among people from different ethnic or cultural backgrounds. What similarities and differences emerge?

Student reports should attempt to show choices vary by ethnic and cultural backgrounds.

(5 minutes, Chapter Objectives 1-1 and 1-2, AACSB: Analytical Thinking and Reflective Thinking)

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CASE STUDY TEACHING NOTES

Alexa -- What is Consumer Behavior?

Summary of Case Amazon’s smart speaker Alexa becomes a factor in consumer decision making through its product recommendation capability. As the use of Alexa and similar products becomes more pervasive, compatibility with these systems’ algorithms may become more important than brand positioning.

Suggestions for Presentation It is suggested that this case be presented with the content related to technology and consumer behavior in the chapter (“The Global ’Always-On‘ Consumer”).

Suggested Answers for Discussion Questions CS 1-1. Choose two of your favorite brands and devise an idea for an Alexa “skill” that consumers could find useful. How would these skills help sell more of the brands’ products and/or increase customer loyalty?

Many brands could be targets for Alexa skills that provide ideas for uses of the brand’s products or help customers solve problems the brands’ products are designed to address. Examples: Nike (exercise routines), Miracle Grow (gardening tips), Axe (grooming tips). The skills could increase sales by increasing consumer satisfaction and/or increasing usage through suggestions of additional use situations.

(10 - 12 minutes, Chapter Objectives 1 & 3, AACSB: Reflective Thinking) CS 1-2. How can brands remain relevant in the Age of Alexa? What strategies should brand managers employ to continue to influence consumer purchase decisions if consumers become more reliant on AI assistants?

Brands will need a deep understanding of the algorithms used by Alexa and similar tools for making product recommendations. With that knowledge, a brand can highlight key differentiating features in product descriptions. Advertising may become more focused on function than image. Brands may still be able to position based on image and less functional attributes, but they will have to try to reach consumers before they are at the point of asking Alexa for a recommendation. Some students may not be familiar with the term “positioning strategy,” discussed in Chapter 3: The use of elements of the marketing mix (i.e., product design, price, distribution, and marketing communications) to influence the consumer’s interpretation of its meaning in the marketplace relative to its competitors.

(10 - 12 minutes, Chapter Objective 2, AACSB: Analytical Thinking) .

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CS 1-3. What kinds of products or brands will most likely be either negatively or positively affected by an increased use of AI assistants? Explain your answer.

Products that are currently sold based on imagery rather than functionality are the most vulnerable. Products for which consumers do not do extensive research before purchasing would more likely benefit from decisions made by Alexa algorithms. However, some consumers will look to Alexa for advice on even more expensive, shopping-oriented products.

(10-12 minutes, Chapter Objectives 2, AACSB: Reflective Thinking)

MULTIPLE CHOICE QUESTIONS 1. Amazon’s Echo is an example of a consumer product that relies on . a. artificial intelligence b. robotics c. digital algorithms d. big data e. the Internet of Things Correct response: a Artificial intelligence (AI) is changing the marketing landscape by adding a new channel to push advertising, gather consumer preference data, and create brand loyalty.

2. As more people adopt AI technologies such as Amazon’s Echo, we will likely see _____. a. an increase in the volume of big data collected about individual preferences b. a decrease in the volume of big data collected about individual preferences c. no change in the volume of big data collected about individual preferences since the Echo does not collect data d. no change in the volume of big data collected since it is illegal to eavesdrop on individual households e. a decrease in the demand for data analytics services Correct response: a These devices are listening in and collecting data on individual preferences. This will add to the volume of big data and increase the need for people with the skills to analyze this data.

3. Which of these groups is most likely to utilize a technology such as Alexa? a. Baby Boomers b. Digital natives c. Hispanics d. Older consumers e. Men Correct response: b Digital natives are those individuals who grew up with technology. They have always been “wired” and have never experienced a world without hands-on, instant access to digital technologies. .

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4. Technologies such as Alexa and Siri rely on software to interact with consumers known as a. the Internet of Things b. voice recognition c. visual d. lifelog software e. robot companion Correct response: b Voice recognition software enables us to ask questions that Alexa can answer. Consumers can set up voice profiles so Alexa can recognize their individual speech patterns.

5. In the age of AI, promotion will likely be directed more to a. “pull” activities b. image-oriented advertising c. influencer advertising d. “push” activities e. personal selling Correct response: d “Push” activities are focused on the distribution channel, as compared to “pull” activities like traditional advertising that are focused on the consumer. Since Alexa is tightly connected to a distribution channel (Amazon), it is more likely that promotion focused on the requirements and idiosyncrasies of the channel will be more effective in the age of AI.

Additional Support Material STUDENT PROJECTS Individual Projects 1.

Ask students about their involvement with social media sites and/or blogs. Ask them to explain why they are using them. What benefits do they derive from them? Who are the target audiences for their information? Have them explain their concerns about privacy, if any.

Student responses about their involvement with social networking sites and blogs will vary and can be used to generate discussion about how consumers influence one another through electronically mediated communications, to remind the class about the concepts (e.g. digital natives, virtual communities) and to connect how the web and the horizontal revolution are changing consumer behavior to students’ personal experiences.

(7 minutes, Chapter Objective 1-2, AACSB: Reflective Thinking)

2.

This assignment can really be fun for the class and the presenter. Have a student wear or bring to class a recent clothes purchase. Have them explain how his or her purchase decision was influenced by different economic, social, cultural, and/or psychological variables.

The individual responses to this activity will be as varied as the personalities of .

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the students in your class, but it is a good opportunity to remind students about how consumers often consume products because of what they mean, not because of what they do. This assignment can also work well as a collage, where students use images of products to tell rest of the class about them (and may include products they currently use or aspire to use in the future). This project can also lead to the discussion of the connection of the products to the student’s selfconcept/identity and provide the student with the opportunity to explore the economic, social, cultural, and/or psychological variables that make the product desirable. (5 minutes, Chapter Objectives 1-1 and 1-4, AACSB: Reflective Thinking) 3.

This activity can be done as an extension to or independent of assignment number 2.

Have students explain why they chose the clothes they are wearing to class. Probe on this one. Was there any implied symbolism? Do all students seem to be dressed in a similar fashion? Why does this occur? Can marketers learn from this? Do marketers strategically contribute to this?

This activity is likely to generate some discussion about how consumers use clothing to identify themselves as part of a group (or distinguish themselves as not part of a group).

You can give students the opportunity to make the connection between group influences and marketers’ attempts to segment their target audiences. You may also direct students to consider the role of popular culture in their clothing choices. This activity provides an opportunity to remind students about the concept of economics of information, and to ask them how advertising and/or product placements contributed to their senses of style.

(5 minutes, Chapter Objectives 1-1 and 1-2, AACSB: Reflective Thinking and Analytical Skills)

4.

Assign students to teams to identify at least three instances where consumer social media has had an impact on the organization and/or popular culture. Examples may include such things as consumer tweets to a perceived unpopular decision by a business (for example photoshopping of models to make them appear ‘perfect’) or citizen social media blowback from perceived injustices by government (for example the ongoing immigration debates).

This activity provides students with the opportunity to recognize that just as marketers adapt to changing consumer needs, consumers now wield the power to influence not only marketers but governments and popular culture. (5 minutes, Chapter Objective 1-2, AACSB: Reflective Thinking)

5.

Ask students to consider their own consumption practices over the past decade. Have them list the ways that online consumption activities have replaced or modified their realworld consumption activities.

This activity asks students to reflect on their personal experiences with the internet and how those experiences affected offline consumption activities. It is a good opportunity to remind students about the availability of niche products, virtual communities, and consumer recommendations. It may also provide an opportunity to ask students about how their online consumption activities are tracked/monitored by marketers, and what .

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value they receive in exchange for the loss of privacy. (10 minutes, Chapter Objective 1-2, AACSB: Reflective Thinking)

Group Projects 1.

Have groups select a product of interest (e.g., a car, mp3 player, vacation spot, movie, sporting event, etc.). Have each person in the group make a list of what they consider to be the product’s main attributes (both physical and psychological). Compare and contrast the attributes listed by the women and by the men to see how they may vary. Next, if there are any age or ethnic differences within the group, see if differences appear. Based on these differences formulate strategies for appealing to the various subgroups within your group.

The project gives students the opportunity to see whether preferences differ across demographic variables that marketers use to segment customers. The responses will vary depending on the product and the students. You can also ask students to consider how individual lifestyles affect the attributes of interest, which may help explain similarities across ethnic and age groups.

Students are likely to think about the media they will use to appeal to different subgroups Encourage them to think retail distribution, the messages they will use to communicate with their target audiences, the price, and the characteristics/features of the product they will use to appeal to the different subgroups. This will demonstrate how knowledge of consumer needs and wants relates to market strategy. (15-20 minutes, Chapter Objective 1-2, AACSB: Application of Knowledge and Written and Oral Communication)

2.

Have groups of students find an example of a recent product, service, or program that was a failure. Fortune, U.S.A. Today, the Wall Street Journal, Forbes, or some other marketing publications are excellent sources. Have students explain to the class how knowledge of consumer behavior, or the lack of it, could have contributed to the success or failure of the effort.

Similar to #2, the responses and reasons for failure will vary. The project should reinforce the idea that marketers need to have a thorough understanding of consumer behavior of their target audiences to understand how to meet their needs and wants. It can be related to the question of whether marketers create needs. Look for students to “diagnose” the reasons for failure in a way that goes beyond the surface clues in the article. It may be a good opportunity for students to explore other sources at the same time to look for additional clues (e.g. Census data, economic indicators, Lifestyle Analyst, profiles of competitors, etc.). (15-20 minutes, Chapter Objective 1-1, AACSB: Application of Knowledge)

ONLINE ASSIGNMENTS .

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Chapter 1: Buying, Having, and Being: An Introduction to Consumer Behavior

Individual Assignments 1.

Go to www.rockstargames.com. Click on the link for “games.” Select three different video games marketed by this company. Discuss both sides of an ethical debate for each.

This activity provides students with an opportunity to think not only think about what they consider right and wrong, but also to analyze the issue from the opposite perspective.

Encourage students to try to support the debate from each side, rather than making one side obviously weaker so their preferred side is a clear winner. It is good practice for building arguments and thinking critically about issues.

(20 minutes, Chapter Objectives 1-3 and 1-4, AACSB: Ethical Understanding and Reasoning)

2.

Go to www.aarp.org. The American Association of Retired Persons is one of the largest lobbying and citizen action groups going today. Projections indicate that, as our nation ages, this organization will only get larger and more influential. After visiting this website, list five ways the organization is trying to influence corporate attitudes toward the older consuming public. What type of networks is the organization trying to build?

How would database information from this group be useful to a marketer?

This activity provides students with an opportunity to get more familiar with the needs of a large and important demographic segment and shows an example of how one group is taking action to address those needs. It also provides an opportunity to revisit the concept of database marketing and why it is useful to marketers.

(10-15 minutes, Chapter Objective 1-2, AACSB: Application of Knowledge)

3.

Visit www.alesyabags.com and identify the factors used to segment the company’s target audience. How does the company use social media to engage its target audience?

Given what you know about the target audience, do you feel Alesya Bags’ use of social media is effective or ineffective? Explain why.

Students should identify the company segments the target audience based on gender, age, occupation, income, and lifestyle. Students should also recognize the role of social media in the target segments’ lives and the role of engagement via social media tools in developing a lifestyle brand.

(10-15 minutes, Chapter Objective 1-2, AACSB: Reflective Thinking)

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Chapter 2: Consumer Ethics, the Marketplace, and the Planet

Chapter 2: CONSUMER ETHICS, THE MARKETPLACE, AND THE PLANET

CHAPTER OBJECTIVES When students finish this chapter, students should be able to: 2-1. Define business ethics and identify the elements that comprise the PESTLE framework.

2-2. Summarize how the political environment affects consumer decision making.

2-3. Discuss how the economic landscape affects consumers’ access to the marketplace.

2-4. Explain the ways marketers respond to social issues to shape consumer behavior.

2-5. Describe the technological changes that are creating new challenges for consumer protection.

2-6. Explain how the legal environment influences consumer behavior.

2-7. Describe how consumer behavior directly impacts the environment.

CHAPTER SUMMARY Define business ethics and identify the elements that comprise the PESTLE framework.

Business ethics are rules of conduct that guide actions in the marketplace; these are the standards against which most people in a culture judge what is right and what is wrong, good or bad.

Marketers must confront many ethical issues, especially ones that relate to how much they make consumers “want” things they don’t need or are not good for them. It is both ethically and financially smart to maximize customer satisfaction. In some cases, external bodies such as the government or industry associations regulate businesses to ensure that their products and advertising are safe, clear, and accurate. Consumer behavior researchers may play a role in this process and those who do transformative consumer research (TCR) may even work to bring about social change. Companies also play a significant role in addressing social conditions through their corporate social responsibility (CSR) practices and social marketing campaigns that promote positive behaviors Summarize how the political environment affects consumer decision making.

In the politically charged environment we inhabit, consumers make choices based on their beliefs and values—and they vote with their wallets. Through their brand and product choices, consumers make statements to companies about the types of products they want and how, when, and where (or even if) they want to learn about those products. The explosion of social activism we’ve encountered both in the U.S. and in many other parts of the world over the past few years has encouraged some companies to take a stand on controversial issues.

Discuss how the economic landscape affects consumers’ access to the marketplace.

Our relationships with companies and other organizations are complex, and many issues that impact quality of life relate directly to marketing practices. In addition to changes in income due to unforeseen events like the pandemic, market access can be a problem because many people are unable to navigate the marketplace as a result of disabilities, illiteracy, or other conditions. .

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Explain the ways marketers respond to social issues to shape consumer behavior.

The 2020s have seen a proliferation of social causes that affect the marketplace in fundamental ways. In response to social justice movements, companies are taking a close look at what their brands and marketing communications look like. Cause marketing is a popular strategy that aligns a company or brand with a cause to generate business and societal benefits. Many firms today try to integrate corporate social responsibility (CSR) into their business models; this encourages an organization to make a positive impact on the various stakeholders in its community, including consumers, employees, and the environment.

Describe the technological changes that are creating new challenges for consumer protection.

Many of us are leery about opening the door to our private lives so that big tech companies can enter at will. One of the biggest ethical issues many marketers face today relates to how much they can—or should—know about their customers, including even their genetic data. New technologies also make it fairly easy to disseminate content that may or may not be “real” or accurate. Artificial intelligence creates new opportunities and challenges for consumers and consumer protection, but the automation of tasks and exchanges based on consumer data also opens up new issues related to privacy, bias, and ethics. Other tech-related challenges include addiction to social media, identity theft, and cyberbullying.

Explain how the legal environment influences consumer behavior.

Concern for the welfare of consumers has been an issue since at least the beginning of the 20th century. Today, activists continue to voice concerns about a range of issues such as child labor, exploitative advertising, and genetically engineered food. Partly due to consumers’ efforts, the U.S. government established many federal agencies to oversee consumer-related activities.

These include the Department of Agriculture, the Federal Trade Commission, the Food and Drug Administration, the Securities and Exchange Commission, and the EPA. Consumers also are at fault for engaging in illegal or borderline activities, such as shoplifting, vandalism, and counterfeiting.

Describe how consumer behavior directly impacts the environment.

Worries about climate change, entire species going extinct, widespread exposure to carcinogens and harmful bacteria, and many other life-and-death issues are front and center. The circular economy model proposes that sustainable growth can happen only through ongoing reutilization of resources and materials with the ultimate goal of generating zero waste. A green marketing strategy involves the development and promotion of environmentally friendly products and a focus on this attribute when the manufacturer communicates with customers. Momentum has been building for some time around the need to claim a brand purpose—a reason to exist beyond making money— and sustainability efforts are fulfilling that need for many businesses.

This “eco-wakening” is happening among many consumers in both developed and emerging economies. The SHIFT framework sums up the actions marketers need to take in order to promote prosocial behavior by identifying five key drivers, such as social influence and tangibility. The LOHAS (Lifestyles of Health and Sustainability) market segment is growing in size and influence as consumers become more sensitized to a brand’s impact on the environment.

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Chapter 2: Consumer Ethics, the Marketplace, and the Planet

CHAPTER OUTLINE I. What Is the “Right” Thing?

Business ethics are rules of conduct that guide actions in the marketplace—the standards against which most people in a culture judge what is right and what is wrong, good, or bad. a. These universal values include honesty, trustworthiness, fairness, respect, justice, integrity, concern for others, accountability, and loyalty. b. Consumer behavior can be the solution to many of the crises we face. The crucial relationships between consumer behavior and the complex world can be examined with the PESTLE framework – examining political economic, social, technological, legal, and environmental issues.

Use Chapter Objective 2-1 Here Use Key Terms business ethics and PESTLE framework Here Use Review Question 2-1 Here Use Consumer Behavior Challenge 2-8 and 2-12 Here

II. PESTLE: The Political Environment Consumers make choices based on their beliefs and values. Through their brand and product choices, consumers make statements to companies about the types of products they want and how, when, and where they want to learn about those products.

A. Consumer Activism Consumer activism occurs when consumers band together to attack what they view as unsafe or otherwise harmful.

B. Corporate Activism A decade ago, it was rare for a company to get out front on an inflammatory issue, for fear of turning off customers. Today, there has been an explosion of social activism across the globe. This has encouraged some companies to engage in corporate sociopolitical activism (CSA), where they deliberately take a stand on a controversial issue. The jury is still out on how consumers will treat companies that take a controversial stand on social issues.

C. Slacktivism Slacktivism refers to small and relatively meaningless expressions of support for important causes, such as liking a charity on Facebook rather than making a donation or volunteering.

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Use Chapter Objective 2-2 Here Use Key Terms consumer activism, corporate sociopolitical activism (CSA) and slacktivism Here Use Consumer Behavior Challenge 2-9 Here

III.

PESTLE: The Economic Environment Large numbers of people do not have market access. That is, their ability to find and purchase goods and services is limited due to physical, mental, economic, or social barriers. An equitable society requires that everyone has equal access. This lack of access has many detrimental psychological consequences for those who experience it.

A. Disabled Consumers More than 10 million adult Americans live with a disability; globally, the number of disabled people is over one billion. In the U.S. this group controls approximately $645 billion in disposable income; yet, most companies pay little attention to the unique needs of this sizeable group.

B. Consumed Consumers Consumed consumers are people who are used or exploited, willingly or not, for commercial gain in the marketplace. Organ, blood, and hair donors are one example.

The global red market for body parts has been estimated to be as high as $1.7 billion.

C. Food Deserts A food desert refers to a census tract where 33 percent of the population or 500 people, whichever is less, live more than a mile from a grocery store in an urban area or more than 10 miles away in a rural area. It is estimated that about 23.5 million people live in food deserts in the United States.

1. Many people experience food insecurity, where they have limited access to a healthy diet on a daily basis.

D. Literacy 1. Media literacy describes the extent to which a consumer can critically evaluate the messages they receive from the web, TV, and every other communication source that tries to persuade us. While it’s our job to critically evaluate this information, not everyone has the skills to do that.

2. Financial literacy is the degree to which a person understands key financial concepts and possesses the ability and confidence to manage personal finances through appropriate short-term decision making and sound long-range financial planning while staying mindful of life events and changing economic conditions.

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Chapter 2: Consumer Ethics, the Marketplace, and the Planet

3. It is estimated that about one in seven U.S. adults is functionally illiterate – meaning they do not have reading skills adequate to carry out everyday tasks.

Use Chapter Objective 2-3 Here Use Key Terms market access, consumed consumers, food desert, food insecurity, media literacy, financial literacy, and functionally illiterate Here Use Review Question 2-7 Here

IV. PESTLE: The Social Environment In response to social justice movements, companies are taking a close look at what their brands and marketing communications look like. a. Cancel culture refers to the phenomenon of the public calling out companies for missteps and recommending that consumers boycott the guilty brands. b. All things being equal, people are likely to choose a brand that gives back to the community. Cause marketing is a popular strategy that aligns a company or brand with a cause to generate business and societal benefits. c. Many firms today try to integrate corporate social responsibility (CSR) into their business models. CSR describes processes that encourage the organization to make a positive impact on the various stakeholders in its community. d. When a company does a good thing, their reputation improves, their consumers’ goodwill increases, and so do consumers’ evaluations of the company’s product through what is referred to as a benevolent halo effect. This vanishes, however, when consumers sense that good behavior is motivated by self-interest rather than a genuine desire to give back. e. Consumers also increasingly hold companies accountable for their corporate social irresponsibility (CSI).

Use Chapter Objective 2-4 Here Use Key Terms social justice, cancel culture, cause marketing, corporate social responsibility (CSR), benevolent halo effect, and corporate social irresponsibility (CSI) Here Use Review Question 2-5 and 2-6 Here Use Consumer Behavior Challenge 2-1, 2-3, 2-4, 2-23, and 2-16 Here

V. PESTLE: The Technological Environment New technologies disrupt our lives – for better and for worse.

A. Data Privacy While we love our technology, many are concerned about data privacy. One of the biggest issues marketers face relates to how much they can or should know about their customers. Technologies record much of our activities including our location if we .

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Chapter 2: Consumer Ethics, the Marketplace, and the Planet

carry a smartphone with GPS. 1. Governments are trying to come to the rescue with data protection policies. The European Union instituted the General Data Protection Regulation, which requires websites to provide visible notice regarding private information they collect through cookies and to give consumers the choice to disagree to such tracking.

2. The paradox is that technology is empowering but also creates vulnerabilities.

Empowerment is now viewed as a latent vulnerability.

B. Data Accuracy The internet’s reach makes it incredibly easy to spread rumors, false “facts”, and even conspiracy theories.

1. When it comes to medical issues, the World Health Organization now calls this glut of false information an infodemic that causes confusion and unhealthy risk-taking.

C. Identity Theft Identity theft occurs when someone steals your personal information and uses it without your permission. It is the most common consumer complaint according to the FTC. 1. Criminals may also access sensitive information through data breaches, where they hack into an organization’s computers.

2. Phishing occurs when people receive fraudulent emails that ask them to supply account information.

3. Consumers are also open to botnets that hijack computers without a trace.

4. Locational privacy is a related issue as GPS tracking technology identifies and records consumer locations.

D. Pushing the Envelope 1. Artificial intelligence describes computer systems that are able to perform tasks that normally require human intelligence. Even “impartial” computers can make inaccurate decisions if the input they receive is flawed in some way. This is referred to as algorithm bias.

2. Genetic data is the latest frontier in private data potentially mineable for marketing purposes.

E. Technology Addictions 1. Consumer addiction is a physiological or psychological dependency on products or services.

2. Social media addiction can be compared to a chemical dependency.

3. Another issue with technology in cyberbullying, which is the willful and repeated harm inflicted through the use of computers, cell phones, and other electronic devices.

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Use Chapter Objective 2-5 Here Use Key Terms data privacy, General Data Protection Regulation, latent vulnerability, infodemic, identity theft, data breaches, phishing botnets, locational privacy, artificial intelligence, algorithm bias, genetic data, consumer addiction, social media addition, and cyberbullying Here Use Consumer Behavior Challenge 2-1, 2-2, and 2-14 Here

VI. PESTLE: The Legal Environment Concern for the welfare of consumers has been an issue since at least the beginning of the 20th century.

A. Governmental Regulations and Agencies 1. Several federal agencies oversee consumer-related activities in the U.S. These include the Department of Agriculture, the Federal Trade Commission, the Food and Drug Administration, the Securities and Exchange Commission, and the Environmental Protection Agency. Table 2.3 presents consumer legislation that is designed to protect consumers and Table 2.4 lists major U.S. regulatory agencies.

2. Corrective advertising refers to the use of advertising by a company to inform consumers of messages it previously published that were wrong or misleading.

B. Consumers Behaving Badly 1. Consumers’ desires, choices, and actions often result in negative consequences to individuals and the society in which they live. Some of these actions are relatively benign, but others have more onerous consequences. Harmful consumer behaviors, such as excessive drinking or cigarette smoking, stem from social pressures.

C. Consumer Theft and Fraud 1. Both online and offline, fraud is rampant.

2. Stealing from stores is the most common scam. Shrinkage is the industry term for inventory and cash losses from shoplifting and employee theft.

3. Some big companies are trying to crack down on serial wardrobers who buy an outfit, wear it once, and return it; customers who change price tags on items, then return one item for the higher amount; and shoppers who use fake or old receipts when they return a product.

D. Unauthorized Knock-Offs 1. Counterfeiting refers to companies or individuals selling fake versions of real products to customers.

2. Researchers have found one good route to potentially discourage purchases of counterfeit products: generate a feeling of what they term moral disgust.

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Use Chapter Objective 2-6 Here Use Key Terms corrective advertising, shrinkage, serial wardrobers, counterfeiting, and moral disgust Here Use Review Question 2-2 Here Use Consumer Behavior Challenge 2-15 Here

VII. PESTLE: The Natural Environment a. Almost everyone today is concerned about saving our planet. Some analysts call this new perspective that encourages us to make positive decisions throughout the buying process conscious consumerism. The U.S. Environmental Protection Agency defines sustainability as being based on a simple principle: Everything that we need for our survival and well-being depends, either directly or indirectly, on our natural environment. b. Momentum has been building for some time around the need to claim a brand purpose – a reason to exist beyond making money and sustainability efforts are fulfilling that need for many businesses. The World Wildlife Federation describes this growth in awareness as eco-wakening. c. Every action helps, but most likely we need to revisit the fundamental ways we use – and get rid of – natural resources. For example, apparel businesses have been seduced by the allure of fast fashion – inexpensive garments that are manufactured and replaced quickly to keep up with fast-changing trends to feed the ever-changing tastes of shoppers. d. One promising economic model is the circular economy (CE). The CE model proposes that sustainable growth can happen only through ongoing reutilization of resources and materials with the ultimate goal of generating zero waste.

Circularity is “restorative and regenerative by design.” e. As a response to consumer efforts, many firms have chosen to protect or enhance the natural environment as they go about their business activities. This practice is known as green marketing. Reusable grocery bags are growing in popularity as a simple environmental and socially conscious choice to reduce our reliance on disposable plastic bags. Bring your own bags (BYOB) can change shopping behaviors. f. Even though consumers largely support green products, many people don’t actually buy green. This is in part due to the higher price of green products. It is also due to distrust because of greenwashing. Greenwashing occurs when companies make false or exaggerated claims about how environmentally friendly their products are. Despite all the social, cultural, and environmental changes our world faces, consumers’ prosocial behaviors may be the answer. .

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Chapter 2: Consumer Ethics, the Marketplace, and the Planet

This term describes actions that benefit others and the world around us, including charitable giving and other donation behaviors (such as blood or organ donation), volunteering, ethical purchasing, and consumer activism.

B. The SHIFT: Changing Consumer Behavior for the Better The SHIFT framework sums up the actions marketers need to take in order to promote prosocial behavior by identifying five key drivers: Social Influence, Habits, Individual Self, Feelings and Cognition, and Tangibility.

C. The “Tree-Huggers” It’s typical to find that a relatively small number of consumers account for a large amount of the action with regard to a certain consumption activity or purchase.

Marketers point to a segment of consumers who are especially likely to choose sustainable products and services: The Lifestyles of Health and Sustainability segment, or LOHAS. They have also been referred to as cultural creatives.

Use Chapter Objective 2-7 Here Use Key Terms conscious consumerism, sustainability, brand purpose, eco-wakening, fast fashion, circular economy (CE), green marketing, bring your own bags (BYOB), greenwashing, and LOHAS Here Use Review Question 2-3, 2-4, and 2-8 Here

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End-of-Chapter Support Material

REVIEW 2-1.

What are business ethics, and why is this an important topic?

Business ethics are rules of conduct that guide actions in the marketplace. These are the standards against which most people in a culture judge what is right or wrong, good, or bad.

However, the notions of right and wrong differ among people, organizations, and cultures.

This is an important distinction as we learn to work with those of other cultures. (2 minutes, Chapter Objective 2-1, AACSB: Reflective Thinking)

2-2.

Give two examples of important legislation that affects U.S. consumers.

The Pure Food and Drug Act in 1906, the Federal Meat Inspection Act in 1907, the Foreign Corrupt Practices Act in 1977, and the 2010 Dodd–Frank Wall Street Reform and Consumer Protection Act are examples given in the text. (2 minutes, Chapter Objective 26, AACSB: Application of Knowledge)

2-3.

What is a circular economy?

The circular economy (CE) is a model that proposes that sustainable growth can happen only through ongoing reutilization of resources and materials with the ultimate goal of generating zero waste. It is considered “restorative and regenerative by design.” This is different from the linear economy which is on continual expansion through stimulation of mass production, mass consumption, and rapid disposal. Students should refer to Figure 2.1 The Circular Economy in the text. (2 minutes, Chapter Objective 2-7, AACSB: Reflective Thinking)

2-4.

What is eco-wakening, and what are the likely consequences for consumer behavior?

Eco-wakening refers to the growth in awareness of companies to claim a brand purpose.

That is, more organizations are embracing a reason to exist beyond making money.

Sustainability efforts are fulfilling that need for many businesses. One survey cited 66 percent of respondents and 75 percent of millennial respondents saying they consider sustainability in their purchase decisions. This has paid off for companies like Unilever that listen. (2 minutes, Chapter Objective 2-7, AACSB: Reflective Thinking)

2-5.

Define social marketing and give an example of this technique.

Social marketing uses marketing techniques normally employed to sell beer or detergent to encourage positive behaviors such as increased literacy and to discourage negative activities such as drunk driving. (1.5 minutes, Chapter Objective 2-4, AACSB: Application of Knowledge) .

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What is the primary difference between transformative consumer research and other kinds of consumer research?

Transformative consumer research promotes research that includes the goal of helping people or bringing about social change. This idea views consumers as collaborators who work to realize change, rather than as an issue that needs to be researched. Other kinds of research promote research as a way to study an issue, not to promote change.

(2 minutes, Chapter Objective 2-4, AACSB: Reflective Thinking)

2-7. Why is market access an important aspect of consumer well-being? What are some important reasons why consumers can experience limited market access?

Market access is the consumer’s ability to find and purchase goods and services.

Access might be limited because of physical, mental, economic, or social barriers.

There are 11 million U.S. adults that have conditions that make it difficult for them to leave home to shop. This can be minimized through the use of technology and other resources. (2 minutes, Chapter Objective 2-3, AACSB: Reflective Thinking) 2-8.

What is greenwashing, and why is it a problem for marketers?

Greenwashing is the promotion of environmentally friendly products, but often, the claims are false or exaggerated. Studies show that almost one-fourth of U.S. consumers feel they have no way of knowing how true a claim might be, and one report shows that 95 percent of consumer companies that market products as “green” make misleading or inaccurate claims. (2 minutes, Chapter Objective 2-7, AACSB: Reflective Thinking)

CONSUMER BEHAVIOR CHALLENGE Discuss 2-1 In today’s wired world, consumers can run, but we can’t hide: If someone wants to know where we are or where we’ve been, the data are there for the asking. As with web tracking, there is value here: We can easily identify by looking at hundreds or even thousands of reviews the best sushi place within a block of our current location, or perhaps get a heads up on that policeman with the radar gun who is hiding behind that billboard up the highway. However, this is a mixed blessing if this information gets into the wrong hands. Consumers need to make tough tradeoffs between convenience and constant surveillance. The chapter notes that marketing has a huge credibility problem today; most consumers simply don’t trust what marketers say or do. What steps can a marketer take to restore this trust?

Students may discuss the benevolent halo effect and the problem when consumers sense that the good behavior was motivated by self-interests. Companies must demonstrate good faith. This certainly extends to the handling of consumer information. Consumers acknowledge the paradox of empowerment and vulnerabilities with technology. Since consumers are taking many actions to protect their online privacy, marketers might engage in more coordinated interventions with their consumers. Students might refer to Table 2.2 Poisoning the Well: Types .

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of Misinformation to discuss the impact of these types of misinformation and how they impact other “trustworthy” companies. (20 minutes, Chapter Objectives 2-4 and 2-5, AACSB: Reflective Thinking; Ethical Understanding and Reasoning Abilities)

2-2. Internet addiction has been a big headache in South Korea for several years, where 90 percent of homes connect to cheap, high-speed broadband. Many young Koreans’ social lives revolve around the “PC bang,” dimly lit internet parlors that sit on practically every street corner. A government study estimates that up to 30 percent of South Koreans younger than 18 are at risk of internet addiction. Many already exhibit signs of actual addiction, including an inability to stop themselves from using computers, rising levels of tolerance that drive them to seek everlonger sessions online, and withdrawal symptoms such as anger and craving when they can’t log on. Some users have literally dropped dead from exhaustion after playing online games for days on end. How big a problem is internet addiction here in the United States? Should parents and educators actively police how much time kids spend online, or if they do so are they preventing young people from interacting with their peers in the ways they want?

Students will have mixed views about this topic; although, many should be able to relate to the idea of internet addiction. Discussions should include not only the physical and/or psychological potential dangers, but also on the ethics associated with policing others. (20 minutes, Chapter Objective 2-5, AACSB: Reflective Thinking; Ethical Understanding and Reasoning Abilities) 2-3. Should scientists who study consumer behavior remain impartial, or is it appropriate for them to become involved in the topics they research like those who adhere to the transformative consumer research perspective?

Students will have varied opinions on this topic. Students should be able to identify and discuss transformative consumer research and its goals of helping bring about social change. Students should be able to compare this concept to more traditional types of research. Discussion should relate to corporate social marketing and indicate how research has furthered this process. (20 minutes, Chapter Objective 2-4, AACSB: Reflective Thinking) 2-4. Today many consumers pursue a ‘decluttering lifestyle.’ Should marketers encourage this trend toward simplicity even though it stresses buying less stuff that marketers sell? What marketing opportunities do you foresee if this trend spreads?

Keep in mind that the goal of marketing should not simply revolve around trying to sell consumers ‘more stuff.’ Marketing is about providing consumers with what they need and want while considering the larger societal needs. Decluttering fits well within the framework of marketing. Marketing opportunities include creating and providing the products/services that fit this new paradigm. (10 minutes, Chapter Objective 2-4, AACSB: Reflective Thinking) 2-5. Because of higher competition and market saturation, marketers in industrialized countries try to develop third-world markets. Asian consumers alone spend $90 billion a year on cigarettes, and U.S. tobacco manufacturers push relentlessly into these markets. We find .

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cigarette advertising, which often depicts glamorous Western models and settings, just about everywhere – on billboards, buses, storefronts, and clothing – and tobacco companies sponsor many major sports and cultural events. Some companies even hand out cigarettes and gifts in amusement areas, often to preteens. Should governments allow these practices, even if the products may be harmful to their citizens or divert money that poor people should spend on essentials? If you were a trade or health official in a third-world country, what guidelines, if any, might you suggest to regulate the import of luxury goods from advanced economies?

Students will have a variety of views on this topic. Students should indicate regulations and laws in the U.S. that affect a company’s ability to market and indicate how marketing is different in developing or third-world nations. Students should discuss analyst predictions for growth in Europe and the U.S. as well as the expected huge growth in China and other Asian and developing countries. This response should also explain provenance, and the willingness to pay more for an item when consumers know exactly where it came from.

Curation, the process of being an expert on a product should also be discussed. (20 minutes, Chapter Objective 2-6, AACSB: Reflective Thinking) 2-6. A case involving Wendy’s fast-food chain made national headlines when a woman claimed she had found a finger in her bowl of chili. The restaurants became the butt of jokes (some said they served nail clippers with their food instead of forks), and sales dropped dramatically at the company’s franchises. This forced layoffs and reduced hours for many employees – until the woman was arrested for fraud. Consumers commonly file lawsuits against companies to claim damages if a product or service didn’t work as expected. In some cases, the defendant just settles the suit to make it go away because it costs more to mount a defense than to just pay damages. Are there too many frivolous lawsuits? Does our justice system adequately meet the needs of both consumers and companies in terms of how it awards damages?

Student responses will vary but the instructor can use this discussion to address major legislation related to consumer behavior. Legislation would include a discussion on the Department of Agriculture, the Federal Trade Commission, the Food and Drug Administration, the Securities and Exchange Commission, and the EPA. (20 minutes, Chapter Objective 2-6, AACSB: Reflective Thinking) 2-7. Nonprofit organizations routinely rely on generous corporate donations, and it is common to name facilities after benefactors. The Nationwide Children’s Hospital in Ohio is no exception; its name recognizes the insurance company’s $50 million donation. Now the hospital is adding the Abercrombie & Fitch Emergency Department and Trauma Center and there is the Limited Too & Justice Main Lobby. The Campaign for a Commercial-Free Childhood opposes this partnership. The group’s director commented, “Abercrombie & Fitch is really among the worst of corporate predators. A company with such cynical disregard for children’s well-being shouldn’t be able to claim the mantle of healing. . . . And, personally, I find it very concerning that they named their hospital after an insurance company.” What do you think? Is this over the line, or does it matter where the money comes from so long as the result is beneficial?

Students will vary in their response to this challenge as both sides present important points.

Abercrombie recognizes the positive publicity, which will be generated from such a donation, .

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and charities need funding. At the same time, the center may feel that it is selling out to accept money from an organization, which behaves at times as though it lacks concern for children.

(5 minutes, Chapter Objective 2-1, AACSB: Ethical Understanding and Reasoning Abilities) 2-8. From time to time, advertisers use dark humor to get their messages across, as when a lonely calorie, repairman, or robot considers suicide. Or, an ad may imply that shoppers are “mentally ill” if they pay retail prices. Are these appeals a legitimate way to communicate a message; if so, under what circumstances?

Such appeals are meant to be humorous rather than fear or guilt based. Humor appeals are legitimate. The issue is whether this form of humor is in good taste and a good choice for the brand in question. (3 minutes, Chapter Objective 2-1, AACSB: Ethical Understanding and Reasoning Abilities) 2-9. The chapter discusses the positive and negative potential effects of corporate sociopolitical activism (CSA). What’s your feeling—should a company link itself to a social cause, or should it remain neutral?

Students should review the positive and negative effects of CSA discussed in the text. Student feelings on the topic are likely to vary widely. Students should be encouraged to provide examples for their positions. (10 minutes, Chapter Objective 2-2, AACSB: Ethical Understanding and Reasoning Abilities) 2-10. Fifty-four million dollars for a pair of missing pants? A judge in Washington, D.C., made headlines when he filed a $54 million lawsuit against his neighborhood dry cleaner because it lost a pair of his pinstriped suit pants. He claimed that a local consumer protection law entitled him to thousands of dollars for each day over nearly four years in which signs at the shop promised “same day service” and “satisfaction guaranteed.” The suit dragged on for several months, but at the end of the day, the plaintiff went home with empty pockets.111 And some people claim we have too many lawsuits in this country! Should our legal system allow for lawsuits that encourage consumers to sue companies over complaints like this?

Students will vary in response to this issue as both sides may have valid points. This question will certainly provide a lively discussion. (10 minutes, Chapter Objective 2-6, AACSB: Reflective Thinking)

2-11. A woman in New Zealand apparently died from drinking too much Coca-Cola. Her family said she drank about 2.2 gallons of the beverage every day for years. Prior to her death, she had several rotten teeth removed, and she gave birth to a baby who was born without any tooth enamel. The 31-year-old mother of eight died following a cardiac arrhythmia after consuming more than two pounds of sugar and 970 mg of caffeine a day. Coca-Cola noted that the coroner’s report, while singling out its product as a probable cause of death, stated that the company “cannot be held responsible for the health of consumers who drink unhealthy quantities of the product.”112 What’s your take on this—should companies be held liable if their customers misuse what they sell?

Students will vary in response to this issue. Students should present strong foundations for .

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the positions they take. A review of PESTLE’s legal environment would be necessary.

There are many practical as well as ethical issues that can be considered. Some students may draw parallels to excessive alcohol consumption. (10-20 minutes, Chapter Objective 2-6, AACSB: Ethical Understanding and Reasoning Abilities; Reflective Thinking)

2-12. A hot-button topic right now involves efforts to curb child obesity by encouraging advertisers to limit the messages they send to kids about foods that are high in sodium, saturated fat, and added sugars. Under new federal rules, even the scoreboards in high school gyms will have to advertise only healthy foods. Several large cities including New York City and Philadelphia have tried to prevent the sale of large sizes of sugary drinks to fight obesity.

Public health advocates hail these attempts, whereas others argue that they would transform the United States into a “Nanny State” that imposes on our freedom to choose to consume whatever we would like. Should city, state, and federal governments dictate what (legal) products people should consume, even when the population’s health is at stake?

Student responses will vary substantially. There are many practical as well as ethical issues that could be discussed covering everything from who decides what is ‘healthy’ to varying viewpoints on what constitutes ‘ethical action.’ (20 minutes, Chapter Objective 2-1 and 2-6, AACSB: Reflective Thinking; Ethical Understanding and Reasoning Abilities) 2-13. Companies and organizations in the United States spend billions of dollars to acquire and manage data on consumers such as credit and transaction histories. Well-off consumers obviously hold great attraction to marketers because they have greater buying potential.

Today companies have the ability if they choose to offer a more attractive deal to highervalue customers to win their business. The flip side of this process is that potentially they can discriminate against low-income people who won’t qualify for lower prices. And in most cases, companies don’t permit consumers to access their database to learn what they know about them. Is it fair to stratify consumers in this way so that some get access to more attractive options than others?

The question should generate quite a lively discussion, as opinions will be markedly varied.

Looking at this from a strict economic perspective, it makes perfect sense for companies to concentrate on those who can buy more and pay more. However, from a social marketing perspective, even those that are disadvantaged in some manner (for example income) should have access to the same products. (20 minutes, Chapter Objective 2-4, AACSB: Reflective Thinking; Ethical Understanding and Reasoning Abilities)

Apply 2-14. Will consumers trade lower prices for less privacy? Car owners now can let insurance companies monitor their driving using a new technology in exchange for lower rates.

Customers who sign up for Progressive’s TripSense program get a device the size of a Tic Tac box to plug into their cars. The device will track speed and how many miles are driven at what times of the day. Every few months, customers unplug the device from the car, plug it into a computer, download the data, and send them to the company. Depending on results, discounts .

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will range from 5 to 25 percent. In Great Britain, a major insurer is testing a program called Pay as You Drive. Volunteers will get a device the size of a Palm computer installed in their cars. The gadget will use global positioning satellite technology to track where the car goes, constantly sending information back to the insurance company. Cars that spend more time in safer areas will qualify for bigger discounts. Of course, the potential downside to these efforts is that the insurance companies may be able to collect data on where you have driven, how long you stayed in one location, and so on. Conduct a poll of ten drivers of various ages where you describe these programs and ask respondents if they would participate to receive a discount on their insurance premiums. What reasons do they give —pro and con?

This question of exchanging privacy for lower prices (or convenience, or any of a number of other benefits) can be applied in many contexts these days, particularly in e-commerce. As the student reports are discussed, the instructor can relate this issue to various topics. These include value (what benefits are people gaining and what cost are they “paying”?), ethics (what are the implications of companies having such a depth of information on consumers?), public policy (should there be attempts to regulate such business activities?), and demographic segmentation. Probe students as to what types of trade-offs they have made (providing personal, credit card, bank account, and other information in order to conduct business online) (10 minutes, Chapter Objective 2-5, AACSB: Ethical Understanding and Reasoning Abilities) 2-15. Many college students “share” music by downloading clips. Interview at least five people who have downloaded at least one song or movie without paying for it. Do they feel they are stealing? What explanations do they offer for this behavior? Try to identify any common themes because of these interviews. If you were devising an ad campaign to discourage free downloading, how might you use what you have learned to craft a convincing message?

Obviously, ethical issues of right and wrong should emerge here. These issues should reflect the ethical behavior of the consumer (is it wrong to download for free?), as well as that of the corporations (are they ripping customers off by charging too much?). Reports should also revolve around “dark side” issues. Specifically, is this activity stealing? Is it on the same level as shoplifting? Certainly, the explanations given will fall into the category of justification. Thus, from the marketer’s perspective, the suggested ad campaign should be designed in a way to persuade consumers that their justified behavior is wrong. (5-10 minutes, Chapter Objective 2-1 and 2-6, AACSB: Ethical Understanding and Reasoning Abilities) 2- 16. If you’re not happy with a product or service, is it worthwhile to complain?

In one study, business majors wrote complaint letters to companies. When the firm sent a free sample in response, this action significantly improved how the students felt about it. This didn’t happen, however, when they only received a letter of apology—but no swag. Even worse, students who got no response reported an even more negative image than before. This shows that any kind of response is better than none. 116 Interview people you know who have had negative experiences with stores or manufacturers. What action (if any) did they take, and what happened? Are they more or less likely to patronize the offending company as a result?

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Student responses will vary substantially as they share the experiences of people they interviewed. Students should include a discussion of why people took the actions they did. (20 minutes, Chapter Objective 2-1 and 2-4, AACSB: Ethical Understanding and Reasoning Abilities)

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CASE STUDY TEACHING NOTES Chapter 2 Case Study: Face It-- Facial Recognition Is Coming to a Walgreens Near You Summary of Case Facial recognition is being used in marketing in a variety of ways. Walgreens uses the technology to determine the demographics of customers viewing a cooler and presents targeted ads. Customers entering a store can be analyzed to determine the optimal age of floor personnel or when one of those customers is a VIP. Payment processes can be sped up and faces can be analyzed for reactions to ads. The technology is not perfect and can misread the faces of women and people of color. Some states in the U.S. are regulating the use of facial recognition.

Suggested Answers for Discussion Questions CS 2-1. Compare the use of facial recognition in marketing with other tools of one-to-one marketing, like online cookies or databases that contain detailed personal information gleaned from a variety of sources. How is facial recognition the same or different?

Both online use of cookies and in-store use of facial recognition provide some level of disclosure of their use, the latter through signs posted in the store. However, while an online user is often prompted to OK the use of cookies, a similar “opt in” is not available for facial recognition.

Some students may not be aware that marketing databases have collected so much information about them, much of which is gathered through the normal processes of doing business. In this way, the use of databases to target customers is similar to facial recognition gathered when consumers are just moving through their daily activities.

(10 minutes, Chapter Objective 5, AACSB: Reflective Thinking) CS 2-2. Some retailers use facial recognition to alert staff to the arrival of known shoplifters. What are the pros and cons of this application of the technology?

Retailers benefit as store personnel are notified and can use surveillance (cameras and floor personnel) to prevent some shoplifting and catch those who are observed stealing.

However, the imperfections of the technology risk some shoppers being “branded” as a thief when it is just a matter of mistaken identity. This can have negative reputational impact for those who are incorrectly tagged as a known shoplifter. This problem is particularly troubling for shoppers of color as some of the facial recognition technology is less reliable in distinguishing non-white people.

(10 minutes, Chapter Objectives 4 & 5, AACSB: Reflective Thinking) CS 2-3. What steps could companies take to use facial recognition technology ethically? In your answer, consider options for informed consent in various contexts: retail stores, outdoor billboards, and tablets in rideshare vehicles. .

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A primary objective should be to make consumers aware of when facial recognition is in use. In retail stores, this could be done via signs or messages on receipts. Outdoor billboards could periodically flash a message that explains that facial recognition is in use. This approach could also be used on screens in rideshare vehicles.

While disclosure messaging should be clear, it can also include statements about the value to consumers of the use of the technology: more personalized product offers that better fit consumer preferences, more personalized/faster service, and advertising that better fits the consumer’s demographic profile.

(10 minutes, Chapter Objective 5, AACSB: Reflective Thinking)

MULTIPLE CHOICE QUESTIONS 1. Concerns about the use of facial analysis have been primarily about its use in what context? a. law enforcement b. robotics c. higher education d. entertainment e. the Internet of Things Correct response: a Much of the conversation about facial recognition has focused on its use in law enforcement, with concerns about the level of identification accuracy, particularly with the faces of women and people of color.

2. Early versions of facial recognition were significantly less accurate when identifying the faces of women and people of color. This inaccuracy has been attributed to a. racism b. sexism c. “training” of the software using images of white males d. lack of diversity among programmers developing the software e. errors of randomness Correct response: c The inaccuracy of early versions of facial recognition technology has been attributed to the process of “training” the algorithms using images of celebrities that were more often white and male.

3. Walgreens’ use of facial recognition evaluates shoppers looking at coolers, seeking to determine all the following consumer characteristics except a. age b. gender c. products being looked at d. emotional response to display e. body type Correct response: e Walgreens’ facial recognition looks for age, gender, products being looked at, and emotional responses. .

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4. As compared to traditional focus group evaluations of advertising, facial recognition is more a. invasive b. unbiased c. entertaining d. time-consuming e. ethical Correct response: b Advertising can be enhanced by facial analysis. Rather than relying on expressed opinions in focus groups, advertisers can get unbiased and unreserved emotional reactions to proposed ads in a noninvasive manner.

5. Concerning the regulation of companies’ use of facial recognition in the U.S. a. The federal government strictly regulates the way facial recognition can be used. b. Three states have passed bills regulating the way facial recognition can be used and other states are considering doing so. c. More than half of the states in the U.S. have some form of facial recognition regulation. d. While there are guidelines for the use of facial recognition, no states have financial penalties for violations of those regulations. e. “Caveat emptor” (“Let the buyer beware.”)

Correct answer: b There is currently no federal regulation that limits companies’ use of facial recognition, but three states – Illinois, Texas, and Washington – have passed bills and other states are considering doing so. At least two states have financial penalties associated with violations.

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Additional Support Material STUDENT PROJECTS Individual Projects 1.

Have students explain what it means to be a green consumer. They could report on what they have done to be “green” and how their behaviors have changed. Have they tried to influence anybody else to go “green” and how?

The chapter introduces the idea of green marketing, but student perceptions of green consumers are likely to be based on outside experiences, including their own efforts to be more environmentally responsible, which will vary. Some students may view green consumers as the small subset of consumers who willingly make sacrifices to protect the environment. Others may characterize green consumers as idealistic tree-huggers.

Research indicates most consumers fall somewhere on a spectrum from green to brown based on their environmental values and their beliefs in their ability to make a difference.

The question about their attempts to influence others can be related to the idea of consumption communities and group influences on consumption behavior. (5 minutes, Chapter Objective 2-7, AACSB: Reflective Thinking)

2.

Each group should locate an example of a company that is heavily involved in social or green marketing. Make a report on the activities of the company. Compare this company to a direct competitor that is not so extensively involved in such activities. What are the advantages/disadvantages that the social/green approach has over the other?

Student responses should reflect an understanding of what social or green marketing is.

Some students may confuse social marketing with marketing via social media, so it is important to identify differences between the two concepts. The comparison with the competitor should consider the way the company uses or does not use their social/green marketing efforts to position their offerings. If possible (it will depend on the company/industry), students should analyze how social/green marketing efforts relate to the company’s bottom line, consumer attitudes toward the company, and brand loyalty.

(20 minutes, Chapter Objective 2-4 and 2-7, AACSB: Analytic Skills)

ONLINE ASSIGNMENTS

Individual Assignments 1.

Go to www.moveon.org. What is the main variable that this site uses to segment the American public? What is the resulting segment to which this site is attempting to appeal? Extensively, describe this segment in terms of demographic and psychographic variables. What issues seem to be raised on this site? If you were an advertiser, would it be a good idea to sponsor a message on this site? Explain.

Moveon.org is a civic action group that segments the American public based on political .

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ideals. Opinions are one of the facets of psychographic segmentation (activities, interests, opinions). The website notes the organization is a non-partisan effort to give the public a voice in policymaking. However, the separate PAC by the same name raises money to support Democrat candidates. Unlike other political action groups, its donors tend to give small donations via the web. Students may make inferences about the demographics and psychographics of the group’s audience based on the issues raised on the website, and the group’s use of the web as a primary communication vehicle. Student opinions of whether it would be a good idea to sponsor a message on the site may depend on these inferences, but students may also point out that site sponsorship by corporate interests contradicts the group’s mission to reduce corporate America’s influence over Washington. An advertiser for a social initiative may not be as susceptible to this challenge.

(15 minutes, Chapter Objective 2-2, AACSB: Analytic Skills and Reflective Thinking) 2.

Go to www.benjerry.com. Ben & Jerry’s Ice Cream is famous for a well-rounded mission statement and care and concern for the environment. What is their mission? What indications are there about the organization’s commitment to the environment? What values does the company try to express? How might this expression help the organization market products?

Ben & Jerry’s mission statement can be found under Values (follow the link here: https://www.benjerry.com/values). The company publishes a Social and Environmental Assessment Report each year (follow the link here: https://www.benjerry.com/aboutus/sear-reports). Students may relate the company’s values to the growing LOHAS segment.

(25 minutes, Chapter Objective 2-4 and 2-7, AACSB: Reflective Thinking)

3.

Go to www.wholefoods.com. Take some time to become familiar with the website.

Describe this company and the products that they offer. Select specific examples of products that seem to target the LOHAS values segment. Are there products that might appeal to values other than those described by LOHAS? LOHAS is an acronym for “lifestyles of health and sustainability.” Marketers are responding to the needs of this segment with eco-friendly products and programs. Students may observe the Whole Foods seafood labeling initiative and their efforts to reduce seafood that is not sustainable. Students may become aware of wellness programs Whole Foods rolled out in select markets, which include nutrition programs, social dinners, and partnerships with exercise facilities/yoga centers in exchange for a membership fee.

Students should also recognize that people might buy products that appeal to LOHAS for reasons other than health and sustainability.

(20 minutes, Chapter Objective 2-7, AACSB: Reflective Thinking)

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Chapter 3: Perceiving and Making Meaning

Chapter 3: PERCEIVING AND MAKING MEANING

CHAPTER OBJECTIVES When students finish this chapter, students should be able to: 3-1. Explain how consumer behavior is often shaped by sensory appeals that are often unnoticed.

3-2. Outline the three-stage process of perception that translates raw stimuli into meaning.

3-3. Discuss how the field of semiotics helps us understand how consumers create meaning out of symbols.

3-4. Describe how consumers play an active role in shaping brand meanings.

CHAPTER SUMMARY Explain how consumer behavior is often shaped by sensory appeals that are often unnoticed.

Marketing stimuli have important sensory qualities. We rely on colors, odors, sounds, tastes, and even the “feel” of products when we evaluate them. Not all sensations successfully make their way through the perceptual process. Many stimuli compete for our attention, and we don’t notice or accurately interpret most of them.

Outline the three-stage process of perception that translates raw stimuli into meaning.

Perception is the process by which physical sensations, such as sights, sounds, and smells, are selected, organized, and interpreted. The eventual interpretation of a stimulus allows it to be assigned meaning. A perceptual map is a widely used marketing tool that evaluates the relative standing of competing brands along relevant dimensions.

Although evidence that subliminal persuasion is effective is virtually nonexistent, many consumers continue to believe that advertisers use this technique. Some of the factors that determine which stimuli (above the threshold level) do get perceived include the amount of exposure to the stimulus, how much attention it generates, and how it is interpreted. In an increasingly crowded stimulus environment, advertising clutter occurs when too many marketing-related messages compete for attention.

We don’t attend to a stimulus in isolation. We classify and organize it according to the principles of perceptual organization. A Gestalt, or overall pattern, guides these principles. Specific grouping principles include closure, similarity, and figure-ground relationships. The final step in the process of perception is interpretation. Symbols help us make sense of the world by providing us with an interpretation of a stimulus that others often share. The degree to which the symbolism is consistent with our previous experience affects the meaning we assign to related objects. .

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Chapter 3: Perceiving and Making Meaning

Discuss how the field of semiotics helps us understand how consumers create meaning out of symbols.

A semiotic analysis involves the correspondence between stimuli and the meaning of signs. The intended meaning may be literal (e.g., an icon such as a street sign with a picture of children playing). Or it may be indexical if it relies on shared characteristics (e.g., the red in a stop sign means danger). Meaning also can be conveyed by a symbol in which an image is given meaning by convention or by agreement of members of a society (e.g., stop signs are octagonal, whereas yield signs are triangular).

Describe how consumers play an active role in shaping brand meanings.

Marketers try to communicate meanings about their brands by positioning their products or services with cues that they hope consumers will interpret in the intended manner. But ultimately meanings reside in consumers’ minds, so brand meanings take a life of their own in the market.

CHAPTER OUTLINE I.

Sensation a. Products and commercial messages often appeal to our senses but because of the profusion of these messages, we don’t notice most of them. We pay attention to some messages and tune out others. b. Sensation refers to the biochemical signals that our senses send to our brain for processing. Our sensory receptors (eyes, ears, nose, mouth, fingers, skin) capture basic stimuli such as light, color, sound, odor, and texture. c. Perception is the process by which people select, organize, and interpret these sensations.

A. Sensory Marketing Sensory marketing occurs when companies think carefully about the impact of sensations on our product experiences.

1. Vision a. All six main elements of visual perception are essential to marketers: 1. Illuminance refers to the amount of light we perceive on an object.

2. Shape is the perceived space occupied by an object in the perceptual field as comprised by the outer boundaries of that object.

3. Surface color affects how people perceive an object.

4. Materiality refers to the visual texture and reactance of the exterior surface of an object.

5. Location is the positioning, orientation, spacing, and movement of an object in relation to other objects within an area. b. A handful of firms produce color forecasts. c. Recent research found evidence of an aesthetic bias: Product designs that are deemed more attractive lead us to think the product will also be more useful.

2. Dollars and Scents

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a. Odors stir emotions or create a calming feeling. They invoke memories or relieve stress. b. We process fragrance cues in the limbic system, the most primitive part of the brain and the place where we experience immediate emotions.

3. Sound a. Music and other sounds affect people’s feelings and behaviors. b. Pitch helps consumers make inferences about the size of a product: Lower pitch in voice or music leads consumers to infer a larger product size. This Pitch-size effect occurs because we tend to visualize what we hear: It’s a cross-modal effect where two different sensory systems influence one another. c. Sound symbolism is the process by which the way a word sounds influences our assumptions about what it describes and attributes.

4. Touch a. The natural user interface incorporates habitual human movements that we don’t have to learn. b. The endowment effect occurs when people imagine owning a particular object. c. The power of touch even translates to online shopping, where touchscreens create a stronger feeling of psychological ownership compared to products consumers explore using a touchpad or a mouse. d. Researchers are starting to identify the important role the haptic (touch) sense plays in consumer behavior. e. Individuals who score high on a need for touch (NFT) scale are especially sensitive to the haptic dimension. f. Researchers have found that people like a product less and are less likely to buy it if another person has touched it earlier. This is known as the contamination effect. g. Kansei engineering is a philosophy that translates customers’ feelings into design elements.

5. Taste a. Taste is a huge driver behind the $46 billion Americans spend on food and beverages in a year. b. Gastrophysics is the focus on the science of eating that considers how physics, chemistry, and perception influence how we experience what we put in our mouths. c. All foods are a combination of five basic tastes: sweetness, sourness, bitterness, saltiness, and umami (a savory taste). d. Each additional bite of food can be increasingly pleasurable. This is referred to as hedonic escalation. This is especially likely when a food is made of a complex combination of flavors and when we are motivated to identify more of those flavors in each bite.

B. Augmented and Virtual Reality: Welcome to the Metaverse Augmented reality (AR) refers to media that superimpose one or more digital layers of data, images, or video over a physical object.

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Chapter 3: Perceiving and Making Meaning

The imminent explosion of virtual reality (VR) technology in the consumer market is also driving the integration between physical sensations and digital information. Unlike AR that delivers a combination of both sensory experiences, VR provides a totally immersive experience that transports the user into an entirely separate 3D environment.

Use Chapter Objective 3-1 Here Use Key Terms sensation, perception, sensory marketing, illuminance, shape, surface color, materiality, location, color forecasts, pitch-size effect, cross-modal effect, sound symbolism, natural user interface, endowment effect, psychological ownership, haptic, need for touch (NFT), the contamination effect, Kansei engineering, Gastrophysics, hedonic escalation, and augmented reality (AR) Here Use Review Questions 3-1 and 3-8 Here Use Consumer Behavior Challenges 3-12 and 3-18 Here

II.

The Stages of Perception a. Like computers, we undergo stages of information processing in which we input and store stimuli. Unlike computers, though, we do not passively process whatever information happens to be present. b. The three stages of exposure, attention, and interpretation make up the process of perception.

B. Stage 1: Exposure Exposure occurs when a stimulus comes within the range of someone’s sensory receptors. Consumers concentrate on some stimuli, are unaware of others, and even go out of their way to ignore some messages.

1. Sensory Thresholds a. Sensory threshold is the point at which the stimulus is strong enough to make a conscious impact on his or her awareness. b. Psychophysics focuses on how people integrate the physical environment into their personal, subjective worlds. c. Absolute threshold refers to the minimum amount of stimulation a person can detect on a given sensory channel. The sound a dog whistle emits is at too high a frequency for human ears to pick up, so this stimulus is beyond our auditory absolute threshold. d. Differential threshold refers to the ability of a sensory system to detect changes in or differences between two stimuli. e. The minimum difference we can detect between two stimuli is the just noticeable difference (j.n.d.)

1.The stronger the initial stimulus, the greater a change in the stimulus must be for us to notice it. This relationship is Weber’s Law. 2.The shrinking (or elimination of small size) packaging is referred to as shrinkflation.

2. The Myth of Subliminal Perception .

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a. Marketers want to create messages above consumers’ thresholds so people will notice them. Some consumers believe that marketers design many advertising messages so they will be perceived unconsciously, or below the threshold of recognition. b. Another word for threshold is limen, and we term stimuli that fall below the limen subliminal. Subliminal perception refers to a stimulus below the level of the consumer’s awareness.

3. The Truth: Pre-Attentive Processing a. Whereas subliminal advertising is largely a myth, there is plenty of scientific evidence for the process called pre-attentive processing: We are able to process information and develop positive brand responses even when we are not directly or deliberately paying attention to a brand message.

C. Stage 2: Attention a. Attention refers to the extent to which processing activity is devoted to a particular stimulus. Consumers often experience sensory overload; we are exposed to far more information than we can process. b. The fight for your attention – or what some marketers refer to as an eyeball economy – gets tougher every day. c. Recent research shows that the mere presence of one’s phone near us results in brain drain: a deficit of cognitive resources.

1.Multitasking a. A large proportion of teens report that they engage in multitasking, where they process information from more than one medium at a time as they alternate among their cell phones, TVs, and laptops. b. Multiscreening, using another media screen while watching television, is a very common form of multitasking.

2. Distractions! a. When an ad distracts us from another activity, we infer that the advertised brand must be interesting. This is referred to as metacognitive inference.

3. Rich Media a. In the online world, advertisers keep innovating to get visitors to watch their messages. One of the most popular today is rich media—the use of animated gif files or video clips to grab viewers’ attention. b. The process of perceptual selection means that people attend to only a small portion of the stimuli to which they are exposed.

4. Getting Attention a. In general, we are more likely to notice stimuli that differ from others around us (Weber’s Law). A message creates contrast in several ways: • Size—The size of the stimulus itself in contrast to the competition helps to determine if it will command attention. Readership of a magazine ad increases in proportion to the size of the ad.

• Color—Color is a powerful way to draw attention to a product or to give it a distinct identity.

• Position – We stand a better chance of noticing stimuli that are in places where we’re more likely to look. That’s why the

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competition is so heated among suppliers to have their products displayed in stores at eye level.

• Novelty—Stimuli that appear in unexpected ways or places tend to grab our attention.

5. Losing Attention a. Adaptation is the degree to which consumers continue to notice a stimulus over time. b. Several factors lead to adaptation: • Intensity—Less-intense stimuli (e.g., soft sounds or dim colors) habituate because they have less sensory impact.

• Discrimination—Simple stimuli habituate because they do not require attention to detail.

• Exposure—Frequently encountered stimuli habituate as the rate of exposure increases.

• Relevance—Stimuli that are irrelevant or unimportant habituate because they fail to attract attention.

D. Stage 3: Interpretation Interpretation refers to the meanings we assign to sensory stimuli. Two people can see or hear the same event, but their interpretation of it can be as different as night and day, depending on what they had expected the stimulus to be. The meaning we assign to a stimulus depends on the schema, or set of beliefs, to which we assign it.

One factor that determines how we will interpret a stimulus is relational processing: this happens when we process a stimulus in relation to the relationships it has with other events, sensations, or images in memory.

1. Interpretational Biases: The Eye of the Beholder Our brains tend to relate incoming sensations to others already in memory, based on some fundamental organizational principles. These principles derive from Gestalt psychology. The German word Gestalt roughly means whole, pattern, or configuration; we summarize this term as “the whole is greater than the sum of its parts.” a. The Gestalt perspective provides several principles that relate to the way our brains organize stimuli: • The closure principle states that people tend to perceive an incomplete picture as complete.

• The similarity principle tells us that consumers tend to group together objects that share similar physical characteristics.

• The figure-ground principle states that one part of a stimulus will dominate (the figure), and other parts recede into the background (the ground).

• Joint vs. separate presentations refers to whether products are presented as a group or independently of one another.

.

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Use Chapter Objective 3-2 Here Use Key Terms exposure, sensory threshold, psychophysics, absolute threshold, differential threshold, just noticeable difference (j.n.d.), Weber’s Law, shrinkflation, subliminal perception, pre-attentive processing, attention, sensory overload, eyeball economy, brain drain, multitasking, Multiscreening, metacognitive inference, rich media, perceptual selection, contrast, size, color, position, novelty, adaptation, intensity, discrimination, exposure, relevance, schema, relational processing, Gestalt, closure principle, similarity principle, figure-ground principle, and joint vs. separate presentations Here Use Review Questions 3-2, 3-3, 3-4 and 3-5 Here Use Consumer Behavior Challenges 3-13, 3-14, 3-15, 3-16, 3-17 and 3-19 Here

III.

Semiotics: The Meaning of Meaning a. To help them understand how consumers interpret the meanings of symbols, some marketers turn to semiotics, a discipline that studies the correspondence between signs and symbols and their roles in how we assign meanings. b. From a semiotic perspective, every marketing message has three basic components: • Object (the product that is the focus of the message) • Sign (or symbol) (the sensory image that represents the intended meaning of the object • Interpretant (the meaning we derive from the sign). c. Signs relate to objects in one of three ways: They can resemble objects, connect to them, or tie to them conventionally.

• • •

An icon is a sign that resembles the product in some way An index is a sign that connects to a product because they share some property A symbol is a sign that relates to a product by either conventional or agreed-on associations

Use Chapter Objective 3-3 Here Use Key Terms semiotics, object, sign, interpretant, icon, index, and symbol Here Use Review Question 3-7 Here Use Consumer Behavior Challenges 3-11 and 3-20 Here

IV. Who Owns Brand Meanings?

A. Marketers Position Brands 1. When a marketer understands how consumers think about a set of competing brands, it can use these insights to develop a positioning strategy, which is a fundamental component of a company’s marketing efforts as it uses elements of the marketing mix .

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to influence consumers’ interpretation of its meaning in the marketplace relative to its competitors.

2. Marketers can use many dimensions to carve out a brand’s position in the marketplace. These include: • Lifestyle • Price leadership • Attributes • Product class • Competitors • Occasions • Users • Quality • Country of origin B. But Ultimately, Brand Meanings Live in Consumers’ Minds 1. A recent review of consumer research on branding concludes that consumers’ constant contestations of brand meanings – where they question and modify what the product or service symbolizes – are a source of strength and even of antifragility: the ability to grow when faced with stressors.

Use Chapter Objective 3-4 Here Use Key Terms positioning strategy, contestation, and antifragility Here Use Review Questions 3-6, 3-9, and 3-10 Here

End-of-Chapter Support Material REVIEW 3-1.

How does the sense of touch influence consumers’ reactions to products?

Moods are stimulated or relaxed based on sensations reaching the skin, whether from a luxurious massage or the bite of a winter wind. Touch has even been shown to be a factor in sales interactions (holding an item makes a consumer feel attached to it; touch can increase tips/coupon redemption). We are surer about what we perceive when we can touch it. (3 minutes, Chapter Objective 3-1, AACSB: Reflective Thinking) .

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3-2.

Identify and describe the three stages of perception.

Exposure occurs when a stimulus comes within the range of someone’s sensory receptors. Attention refers to the extent to which processing activity is devoted to a particular stimulus. Interpretation refers to the meaning that we assign to sensory stimuli. (3 minutes, Chapter Objective 3-2, AACSB: Application of Knowledge)

3-3.

What is the difference between an absolute threshold and a differential threshold?

The absolute threshold refers to the minimum amount of stimulation that can be detected on a given sensory channel. The differential threshold refers to the ability of a sensory system to detect changes or differences between two stimuli. (1 minute, Chapter Objective 3-2, AACSB: Application of Knowledge)

3-4.

Does subliminal perception work? Why or why not?

Some research by clinical psychologists suggests that people can be influenced by subliminal messages under very specific conditions, though it is doubtful that these techniques would be of much use in most marketing contexts. Effective messages must be very specifically tailored to individuals, rather than the mass messages required by advertising. (2 minutes, Chapter Objective 3-2, AACSB: Reflective Thinking)

3-5.

Describe two factors that can lead to stimulus adaptation.

Five factors can lead to stimulus adaptation: • Intensity: Less-intense stimuli (e.g., soft sounds or dim colors) habituate because they have less sensory impact.

• Duration: Stimuli that require relatively lengthy exposure in order to be processed tend to habituate because they require a long attention span.

• Discrimination: Simple stimuli tend to habituate because they do not require attention to detail.

• Exposure: Frequently encountered stimuli tend to habituate as the rate of exposure increases.

• Relevance: Stimuli that are irrelevant or unimportant will habituate because they fail to attract attention. (2 minutes, Chapter Objective 3-2, AACSB: Reflective Thinking)

3-6.

“The whole is greater than the sum of its parts.” Explain this statement.

Gestalt roughly means whole, pattern, or configuration, and this perspective is best summarized by the saying “the whole is greater than the sum of its parts.” (3 minutes, Chapter Objective 3-4, AACSB: Reflective Thinking)

3-7.

List the three semiotic components of a marketing message, giving an example of each.

.

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The object is the product that is the focus of the message (e.g., Marlboro cigarettes).

The sign is the sensory image that represents the intended meaning of the object (e.g., the Marlboro cowboy). The interpretant is the meaning derived (e.g., rugged, individualistic, American). (3 minutes, Chapter Objective 3-3, AACSB: Application of Knowledge) 3-8.

What do we mean by the concept of augmented reality? Give an example that is not discussed in the chapter. How does this concept differ from virtual reality?

Augmented reality refers to media that superimposed one or more digital layers of data, images, or video over a physical object. Virtual reality integrates the physical senses with digital information. Unlike augmented reality that delivers a combination of both sensory experiences, virtual reality provides a totally immersive experience that transports the user into an entirely separate 3D environment. One example of augmented reality not discussed in the text is used by Google when showing routes to destinations. (5 minutes, Chapter Objective 3-1, AACSB: Application of Knowledge)

3-9.

What is a positioning strategy? What are some ways marketers can position their products?

A positioning strategy is a fundamental part of a company’s marketing efforts as it uses elements of the marketing mix (i.e., product design, price, distribution, and marketing communications) to influence the consumer’s interpretation of its meaning. Marketers can use many dimensions to carve out a brand’s position in the marketplace. These include: • Lifestyle: Hairbrella designed a whole line of hair protection products, from sleep caps to rain hats.

• Price leadership: L’Oréal’s Noisôme brand face cream is sold in upscale beauty shops, whereas its Plenitude brand is available for one-sixth the price in discount stores—even though both are based on the same chemical formula.

• Attributes: Bounty paper towels are “the quicker picker upper.”

• Product class: Tesla is an all-electric car.

• Competitors: Northwestern Insurance is “the quiet company.”

• Occasions: Wrigley’s gum is an alternative at times when smoking is not permitted.

• Users: Levi’s Dockers are targeted primarily to men in their 20s to 40s.

• Quality: At Ford, “Quality is job 1.”

• Country of origin: Jeep, Coca-Cola, and Levi’s are the ultimate American brands.

(5 minutes, Chapter Objective 3-4, AACSB: Reflective Thinking)

3-10.

“Brand meanings live in the minds of consumers.” Explain this statement.

Intuit’s co-founder Scott Cook said “A brand is no longer what we (the company) tell the consumer it is. It is what consumers tell each other it is.” The meaning of brands lives in consumers’ minds. It is reflected in what they do and say about the brand. Consumers are increasingly comfortable with owning a brand. They use brands to communicate their .

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personal identity or to connect with other kindred spirits to share their love or hate for what marketers sell. Consumers have an active role in keeping brands alive and dynamic.

(5 minutes, Chapter Objective 3-4, AACSB: Reflective Thinking) CONSUMER BEHAVIOR CHALLENGE DISCUSS 3-11. The slogan for the movie Godzilla was “Size does matter.” Should this be the slogan for the United States as well? Many marketers seem to believe so. The average serving size for a fountain drink has gone from 12 ounces to 20 ounces. An industry consultant explains that the 32-ounce Big Gulp is so popular because “people like something large in their hands. The larger the better.” Some cities (most notably New York) have tried to ban sales of sugary drinks greater than 24 ounces but have so far been unsuccessful.

Hardee’s Monster Burger, complete with two beef patties and five pieces of bacon, weighs in at 63 grams of fat and more than 1,000 calories. The standard for TV sets used to be 19 inches; now it is 32 inches and growing. Hulking SUVs have replaced tiny sports cars as the status vehicle of the new millennium. What’s up with our fascination with bigness? Is this a uniquely U.S. preference? Do you believe that “bigger is better”?

Is this a sound marketing strategy?

This question comprises multiple questions. The first, “What’s up with our fascination with bigness?” is very general and should spark some general comments or discussion.

If anything specific is to come from this particular question, students should be directed to theorize as to “why” people in the United States prefer bigger sizes. The second question, “Is this a uniquely American preference?” can only really be addressed when students have a concept of product size in other countries. Thus, foreign students and students who have lived or studied abroad will be a good resource here. Another option if assigning this question as an at-home project is to have students research product sizes in other countries to make comparisons. It might be helpful if you give a few specific products for them to research, such as soft drinks, automobiles, and televisions.

The third question, “Do you believe that ‘bigger is better’?” should be directed toward whether or not larger sizes benefit the consumer. The final question examines whether super-sized products benefit the marketer. (Possible At-Home Project Idea) (10 minutes, Chapter Objective 3-3, AACSB: Reflective Thinking) 3-12. Augmented reality applications may reach the level of sophistication where we observe almost everything through the screen of our smartphones in order to receive an “enhanced” experience. Do you view this as a positive development or a problem?

Augmented reality can add value to a consumer’s experience by allowing consumers to apply an additional layer of data/images to their existing views, which can deepen the consumer’s understanding of the product/product features. Marketers can use this additional layer to provide customized products and/or promotional offers. However, AR can also serve as a distraction from the real-life sensory experience and may result in information overload. Some students may mention privacy concerns, as the provider .

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of the AR experience can track information about their preferences, or because ultimately AR technology may allow others (including sellers) to recognize and find information about them as they walk down the street or into a store. It may also lead to unwelcome offers (spam) from marketers. (10 minutes, Chapter Objective 3-1, AACSB: Reflective Thinking and Ethical Understanding and Reasoning) 3-13. The chapter notes that marketers may elect to shrink the amount of product it sells and maintain the same price rather than raise the price. Is this ethical?

This question needs to be split into two parts: 1) whether marketers have the right to charge the same for less product and 2) whether the marketer is responsible to inform the consumer of the price to quantity ratio or whether the consumer is responsible to judge value on his or her own. (10 minutes, Chapter Objective 3-2, AACSB: Analytical Skills) 3-14. Define a schema and provide an example of how this concept is relevant to marketing.

A schema is a set of beliefs that we use to assign meaning to something. It is critical that marketing decisions are based on what criteria consumers will use to evaluate a product or message. For example, we assume that products that are lower down in a frame weigh more than products that appear higher in a frame, based on our concept of gravity. Schema also helps to develop a brand personality. (10 minutes, Chapter Objective 3-2, AACSB: Analytical Skills) 3-15.

Many studies have shown that our sensory detection abilities decline as we grow older.

Discuss the implications of the absolute threshold for marketers who want to appeal to the older consumer.

Some of us can pick up sensory information that others, whose sensory channels have diminished, cannot. The absolute threshold refers to the minimum amount of stimulation a person can detect on a given sensory channel. This is an important consideration when designing marketing stimuli. Students should discuss a wide range of implications when appealing to the older consumer. (20 minutes, Chapter Objective 3-2, AACSB: Application of Knowledge)

APPLY 3-16. Interview three to five friends about their perceptions of energy drinks. Construct a perceptual map for each set of products. Based on your map of energy drinks, do you see any areas that are not adequately served by current offerings?

Have the students start this project by listing a number of descriptive words that are or could be used when positioning energy drinks in the marketplace. Have them ask the respondents to position various energy drinks on the map according to their impressions of the energy drinks selected. For the part of the question about areas that are not adequately served by the current offerings, students should identify “gaps” in the map and determine whether filling the gap will add value to the target consumers. Since .

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perceptual mapping is not explicitly covered in the chapter, this is an opportunity for instructors to connect this content to that covered in another class such as advertising.

(Possible Field Project Idea) (20 minutes, Chapter Objective 3-2, AACSB: Application of Knowledge) 3-17. Using magazines archived in the library, track the packaging of a specific brand over time. Find an example of gradual changes in package design that may have been below the j.n.d.

You might give a few hints here. For example, Aunt Jemima, the Morton Salt Girl, and Betty Crocker are trademarks that changed over time. Review the changes in ads as well. Package changes include Ivory Soap, Kellogg’s Rice Krispies, and Campbell Soup. Students can simply examine automobile ads to see how styles of a particular car have changed over the years—the body is the car’s package. (Possible Field Project Idea) This question needs to be assigned with an appropriate time to complete the work. The examples found may mirror the changes in design for the Pepsi logo.

(20 minutes, Chapter Objective 3-2, AACSB: Reflective Thinking) 3-18. Visit a set of websites for one type of product (e.g., personal computers, perfumes, laundry detergents, or athletic shoes) and analyze the colors and other design principles employed. Which sites “work” and which don’t? Why? Look through a current magazine and select one ad that captures your attention over the others. Explain why this ad attracts you.

See if the students will notice how similar many of the products and brands are in terms of shape, weight, color, and size as depicted on the websites. A good way to approach this project is to pick a mainstream product such as an Apple computer (because of its bright colors). Be sure to have students state what they mean by “it will work” (a success) and how this was measured. Have one or two students go online to demonstrate how they approached this project. (Possible At-Home Project Idea) After students have indicated what ad caught their attention, probe to see if there are any other reasons. This is a good opportunity to remind students about what ads are likely to get their attention because of personal factors and stimulus factors. Ask the class if any other aspects of the ad struck them. (Possible Field Project Idea) (20 minutes, Chapter Objective 3-1, AACSB: Analytical Thinking) 3-19. Find ads that utilize the techniques of contrast and novelty. Give your opinion of the effectiveness of each ad and whether the technique is likely to be appropriate for the consumers the ad targets.

Opinions will vary here. Some people like novelty in most everything, while others want people to be more serious. You should look for students to identify different ways marketers create a contrast, and for students to recognize how contrast (including novelty) is used to get their attention and overcome advertising clutter. (Possible Field Project Idea) (15 minutes, Chapter Objective 3-2, AACSB: Reflective Thinking) .

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3-20. Assume that you are a consultant for a marketer who wants to design a package for a new premium chocolate bar targeted to an affluent market. What recommendations would you provide in terms of such package elements as color, symbolism, and graphic design? Give reasons for your suggestions.

Answers will vary here. Some terms that will be used are luxury, best, and ultimate.

Color will vary from purple to gold. (10 minutes, Chapter Objectives 3-1 and 3-2, AACSB: Reflective Thinking)

CASE STUDY TEACHING NOTES Chapter 3 Case Study: The Metaverse is Marketing’s Brave New World Summary of Case The metaverse refers to virtual worlds that allow users to play games and participate in events using a digital persona known as an avatar. Marketers are finding ways to advertise, sell, and build their brands in this new virtual environment. Businesses are opening virtual stores where consumers can enjoy entertainment and buy products for use by their avatars. Some stimuli are enhanced in this world, while others (such as touch) are non-existent. The future for metaverse marketing looks promising with McKinsey & Company predicting global spending in the metaverse could reach as high as $5 trillion by 2030.

Suggested Answers for Discussion Questions CS 3-1. What marketing opportunities could exist for global marketing in the metaverse?

What potential obstacles would have to be overcome to make global marketing successful?

At this stage in the development of the metaverse, the key categories for virtual commerce are in entertainment and the purchase of products and services for use by a consumer’s digital avatar (e.g., clothing).

Brainstorming opportunities could be spurred by considering which categories in the physical world more easily translate than others: Transportation – perhaps avatars want to ride in style.

Food – It’s doubtful that consumers would spend to feed their avatars, but they might participate in games that restauranters like Chipotle have offered, particularly when there is some offer tied to a real-world benefit.

Accountants – Someone must count all that virtual money and at least one major accounting firm has set up shop in the metaverse. (see https://www.nasdaq.com/articles/6-businesses-that-have-bought-land-in-the-metaverse) .

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Counseling – Consumers may feel more comfortable getting help from a virtual provider.

Obstacles include getting later adopters to embrace such an unusual concept. Not unlike online shopping, consumers do not have the advantage of being able to physically interact with the product. Businesses that require a level of personal service will have to deal with potentially thousands of customers entering their virtual store at the same time.

(10 minutes, Chapter Objectives 1 & 2, AACSB: Reflective Thinking) CS 3-2. The visual and auditory capabilities in the metaverse enable creativity but could also lead to sensory overload. How can companies avoid this negative phenomenon, particularly in a virtual environment that is minimally under the control of any individual marketer?

Creative marketers will guide consumers into parts of the metaverse that are more targeted and less distracting, similar to a floor of a department store dedicated to men’s fashion that is away from all the distractions of the main corridor of a busy shopping mall. The flexibility of the virtual world should allow a marketer to personalize the buying experience to one that fits the known preferences of a particular consumer or at least of the demographic group to which the consumer belongs. Colors in a store could be changed for each consumer, décor could be more or less elaborate depending on the consumer’s age, and background music could be adapted to each consumer’s preferences. While all these personal touches could add to sensory overload, if properly implemented, they could create an environment that feels more familiar and therefore less distracting.

(10 minutes, Chapter Objectives 1 & 2, AACSB: Reflective Thinking) CS 3-3. Most brands in the metaverse will probably also exist IRL (In Real Life). How can brands use metaverse initiatives to increase sales of IRL products? What steps should marketers take to ensure that metaverse promotions do not damage the overall brand identity, impacting IRL sales?

Sales promotions in the metaverse could offer a combination of benefits in both virtual and physical worlds (e.g., a coupon that provides a discount on both virtual or IRL products.) Products that are only available IRL could be first “experienced” in the metaverse. The metaverse is a great advertising medium, allowing the use of 3D visuals and opportunities for the consumer to interact with the characters in the ads. These ads can enhance brand image and direct consumers to IRL buying opportunities.

In the real world, marketers must take care not to send messages in words, sounds, or pictures that are damaging to the brand image. This same rule applies in the metaverse with added risks of missteps. Marketers must carefully consider how their products and messaging will be received in the metaverse and how consumers could potentially use and misuse the virtual products and other metaverse investments (like a virtual store). .

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As with IRL, test marketing is essential. The advantage to metaverse marketing is that a failed marketing experiment can be taken down almost instantaneously.

(10 minutes, Chapter Objective 1, AACSB: Application of Knowledge)

MULTIPLE CHOICE QUESTIONS 1. In its current manifestation, the metaverse is a. a single connected/interoperable universe b. several separate digital entities, each with its own rules for access & membership c. only conceptual and cannot yet be accessed d. only available for gaming applications e. illegal Correct answer: b In its current manifestation, the metaverse is not a single connected/interoperable universe, but rather several separate entities, each with its own set of rules for access, membership, and monetization.

2. In metaverse jargon, IRL stands for a. Internal Roblox Layer b. International Reality League c. In Real Life d. Insignificant Risk of Liability e. Instant Realization of Liability Correct answer: c.

In metaverse jargon, the physical world is referred to as In Real Life (IRL).

3. The primary function of Nonfungible Tokens (NFTs) is to a. provide game “pieces” for virtual games b. make change for financial transactions conducted in the metaverse (like digital coins) c. certify ownership of digital art d. facilitate metaverse investments in Bitcoin e. reduce the chances of “virtual fungus” Correct answer: c Nonfungible tokens (NFTs) certify the ownership of digital art using blockchain technology.

4. Consulting firm McKinsey & Company predicts that global spending in the metaverse could reach what amount by 2030? a. $5 trillion .

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b. $5 billion c. $5 million d. $30 trillion e. 10,000 Bitcoin Correct answer: a McKinsey & Company predicts that global spending in the metaverse could reach as high as $5 trillion by 2030.

5. Regarding consumer behavior in the metaverse, which is true? a. Evaluating product quality is much easier in the metaverse than in the real world. b. Consumers will always prefer the real world to the metaverse. c. Sensory stimuli like smells, tastes, and textures are heightened in the metaverse. d. Status signaling is unlikely to exist in the metaverse. e. Sensory stimuli like sights and sounds are on virtual steroids, providing new tools for getting and holding attention.

Correct answer: e In the metaverse, sensory stimuli like sights and sounds are on virtual steroids, providing new tools for getting and holding attention.

Additional Support Material STUDENT PROJECTS Individual Projects 1. Visit a department store through its perfume/cologne/cosmetics section. Do the scents have enough of an appeal to motivate buying? Does it appear that each of these is appealing to the sense of smell in a strategic manner?

For most shoppers, perfumes, colognes, and cosmetics may be an impulse purchase. The products are important to the department stores because they tend to have high margins.

In fact, students should have difficulty remembering discounts associated with these products – companies are more likely to use a gift with purchase as an enticement because they do not want to deteriorate their brands’ images. Department stores often position these products near the main entrance to entice shoppers to “sample” products that were not on their lists. Frequently, the individuals who sell the products in these sections work for, and receive special training from, the companies they represent (as opposed to the department store). From a sensory perspective, the companies often use special lighting and attractive images, including attractive salespeople, in addition to .

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the scents, to help attract additional attention to the area and position their offerings.

(10 minutes, Chapter Objective 3-1, AACSB: Reflective Thinking) 2. Ask students to find three ads that contain symbolism. Examine the symbols and discuss the meaning the symbols convey. Encourage the student to identify the different types of signs used in the ads and the product qualities being communicated by each. Additionally, find a symbol that might not or should not be used in advertising in the cultural context of America. Why would you not utilize it?

The three types of signs discussed in the chapter are icons (signs that resemble products), indexes (signs connected to products because they share a property with the product), and symbols (signs related to the product through conventional or agreedupon associations). You may ask students to find an ad that represents each of these three types of signs to help reinforce the differences between them. Just as the examples will vary, so will the product qualities being communicated by each type of sign.

Students will also find different examples of symbols that might not or should not be used in the cultural context of America. Look for students to identify why it would not be culturally acceptable and use the exercise as an opportunity to connect their examples to the concept that our reactions to stimuli are often a function of our cultural backgrounds. (30 minutes, Chapter Objective 3-3, AACSB: Reflective Thinking) 3. What are the symbols of “green marketing?” Students need to review them and discuss whether or not they are effective.

On the most basic level, companies’ uses of the color green, its associations with environmental protection, and the widely recognized symbol for recycling are likely to come up. However, the discussion is likely to go beyond the recycling symbol and the use of the color green because the use of symbols in green marketing (identified in chapter one as marketing practices that promote a firm’s efforts to protect or enhance the natural environment as they go about their business activities) is a hot topic that may stimulate debate among students. Some companies use symbols associated with wellrecognized environmental organizations. However, students may recognize that there are also an overwhelming number of green marketing symbols associated with green marketing that were created by individual firms that may be confusing to consumers because they lack meaningful and verifiable criteria for what makes the product eligible to be associated with the symbol (e.g., CBS EcoAds). To help students prepare their opinions about whether or not the symbols are effective, you may want to direct them toward the FTC’s Green Guides. (20 minutes, Chapter Objectives 3-1 and 3-3, AACSB: Application of Knowledge) 4. Here is a field project that students always like. Have students (you might have only one or a few students do this as a special or alternative assignment) print a collection of brand/product symbols (an alternative would be to have students create a PowerPoint presentation with images inserted to be projected in the classroom for all to see). Then have this student quiz fellow classmates to see if they can recognize the product or company. This will show students how effective symbols are and how much .

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involuntary learning has taken place in their life. You might give a reward to the student who had the most correct responses.

Student examples and recognition of the symbols will vary. You can connect the exercise to the concepts of perceptual vigilance and talk about the cultural meaning associated with the symbols. For a twist on the exercise, you may ask students to find international symbols for brands that are available in the United States to discuss how and why they are different. (30 minutes, Chapter Objective 3-3, AACSB: Reflective Thinking, Communication Abilities) 5. Here is a tough assignment for an undergraduate. Ask students to spend an afternoon watching a favorite television show. Ask them to be particularly observant of the various products and services that are used as props during the show. Do these products or services have any symbolic value? How would viewer perception be different if alternative brands or even generic brands had been used? To what extent are the props shown or mentioned? Are they used to help develop the plot? How? You can relate this project back to the idea that consumers often use products for what they mean instead of what they do. Props and set design are an important part of character development because they can help quickly create an image and a background for the character. Similarly, consumers use products to help communicate something about themselves or their identities. Students may also recognize that product placements are used frequently in today’s media to break through the clutter associated with other advertising and to overcome challenges associated with consumers fast- forwarding through ads using their DVRs. In some cases, these products may be mentioned as part of the storyline (e.g., an episode of Friends that has a storyline about an apothecary table from Pottery Barn; Toyota’s discussion of product attributes/demonstration of safety features/self-parking cars during the storyline of Bones, etc.). (75 minutes, Chapter Objective 3-2, AACSB: Reflective Thinking) 6. Have students visit a grocery store and pick out five products. They should identify how each appeal to the five senses. How are they the same? How are they different? To what extent do any of them appear to be strategically designed to appeal to the five senses?

This project is a good way to reinforce the five senses and how marketers use appeals to each. Due to the popularity of sensory marketing as a way to differentiate products, students will be able to find a wide variety of products that appeal to the five senses. It is important to look for students to identify similarities and differences in the use of the appeals, and how the appeals relate to strategy, as the analytical aspect of this exercise.

(30 minutes, Chapter Objective 3-1, AACSB: Reflective Thinking and Analytical Skills Group Projects 1. Develop a print and/or video ad for a product/brand that includes as many of the sensory stimuli as possible in order to convey the environmental message. .

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Students will require some time to prepare their ads. Remind them to think about the one message they want to get across and to think about how they can use the stimuli to help break through the clutter. Print ads are generally easier to prepare, but many students have video functionality on their cell phones and share videos online, so finding equipment may not be as challenging as it used to be. Video will allow students the opportunity to include auditory stimuli, while a print ad may provide students with the opportunity to appeal to the sense of touch. (120 minutes, Chapter Objective 3-1, AACSB: Reflective Thinking) 2. Collect a variety of packages of children’s and adults’ breakfast cereals. How different are the j.n.d strategies for each market? Catalog various j.n.d strategies utilized and state whether they are likely to be effective for any other products. If your group were marketing the cereal, what would you have done differently?

Students may want to go beyond the current packages available on the shelves to look for historic images of packages, which are readily available online. Frosted Flakes and Lucky Charms are popular examples of things that have changed over time. Students should look not only at the colors and words used on the packaging but also at how marketers draw attention (or choose not to draw attention) to product changes like package size, the addition of nutrients, and promotional offers. (90 minutes, Chapter Objectives 3-1 and 3-2, AACSB: Reflective Thinking) 3. Have student groups find three examples of brands or companies that have made changes to their products (i.e., retail chains re-designing their stores, a new logo, etc.).

Have them discuss how the concept of “just noticeable difference” might affect consumer perceptions of these changes. Are the changes something that the marketers wanted to be noticed?

Students should recognize that marketers want some changes to go unnoticed (e.g., smaller package sizes, less oz. per package for the same price resulting in an increase in price) while marketers want other changes to be noticed (product improvements, logo redesigns, lower unit pricing). The exercise helps draw additional attention to the trend where food inflation is hidden by smaller (sometimes marketed as healthier or more environmentally friendly) packages, which students may find interesting. Students may enjoy playing “detective” to find variations in products they may not have noticed in the past. (60 minutes, Chapter Objective 3-2, AACSB: Reflective Thinking) ONLINE ASSIGNMENTS Individual Assignments 1. Visit www.globalgreen.org. What are some of the sensory cues they are utilizing in order to attract your attention to various subjects/topics and ads?

The most obvious response will be the use of visual cues. Color, size of headlines, font style, and use of motion may be mentioned among the visual cues. Students may try to .

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connect the use of color to what they learned about color in the chapter. The website also offers videos, which engage users with sight and sound. Since the website is a destination and the Internet is a lean forward medium, it is likely that consumers who go to globalgreen.org are motivated to pay attention to the messages (or they would not visit the website). (20 minutes, Chapter Objective 3-1, AACSB: Reflective Thinking) 2. Go to www.tvguide.com. On the opening webpage, how many ads (including pop-ups) do you notice? Compare and contrast the approach of each ad to exposure, attention, and interpretation. Comment on how the consumer goes through these steps when being exposed to each ad. Provide an illustration of your description.

Student responses will vary. In some cases, most of the advertising space on the website (top, side, and bottom) will be occupied by a single sponsor. Student responses should differentiate between the parts of the process that occur - exposure, attention, and interpretation - and should note personal and stimulus factors that affect the perception process at each stage. (20 minutes, Chapter Objective 3-2, AACSB: Reflective Thinking) 3. Go to www.toyota.com/prius. Prius has focused its promotional efforts on the internet and other non-traditional media. Is this website a good way to promote a car? In terms of concepts of perception, why or why not?

Students will have different opinions about whether the website is a good way to promote a car, so look for ways they support their opinions with the concepts of perception. For example, students may talk about perceptual vigilance, the website’s ability to create a sensory experience, and how Toyota uses the website to shape consumer perceptions in order to position the Prius. (20 minutes, Chapter Objective 3-2, AACSB: Reflective Thinking) 4. Go to www.leapfrog.com or www.pbskids.org. These sites are designed to facilitate learning among children. Compare and contrast these sites for sensory stimulation, attention value, and ability to promote a sale of the product. How are semiotics used on these sites?

Students should recognize that the websites have different goals – leapfrog.com sells educational toys, and pbskid.org promotes (sells) educational programs (using games and videos). The target audience for the two websites varies as well. PBSkids.org is more visually oriented and has audio cues when you scroll over the items, which may be helpful for young users who cannot read (who are included in the target audience for many of the programs). On the other hand, leapfrog.com sells products, so although it also has a separate community for parents, parents are probably the main target audience for the site. In terms of semiotics, students may answer this part of the question by identifying the object, sign, and interpretant of the marketing messages on each site.

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For example, they may identify the books at leapfrog.com as the object, the leapfrog as the sign, and the interpretant as the ability to jump ahead/make progress (leapfrog) using the object. Alternatively, the students may identify icons, indices, and/or symbols on each website. (30 minutes, Chapter Objectives 3-1 and 3-3, AACSB: Reflective Thinking)

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Chapter 4: LEARNING, REMEMBERING, AND KNOWING

CHAPTER OBJECTIVES When students finish this chapter, students should be able to: 4- 1. Describe how conditioning results in learning.

4- 2. Summarize how we learn about products and consumption practices by observing others’ behavior.

4- 3. Explain how our brains process and store information about brands in our memory.

4- 4. Discuss how knowledge about brands is organized in our brains.

CHAPTER SUMMARY Describe how conditioning results in learning.

Behavioral learning theories assume that learning occurs because of responses to external events. Classical conditioning occurs when a stimulus that naturally elicits a response (an unconditioned stimulus) is paired with another stimulus that does not initially elicit this response. Over time, the second stimulus (the conditioned stimulus) elicits the response even in the absence of the first.

Summarize how we learn about products and consumption practices by observing others’ behavior.

Cognitive learning occurs as the result of mental processes. For example, observational learning occurs when the consumer performs a behavior because of seeing someone else performing it and being rewarded for it or when a consumer avoids a behavior because of seeing someone else performing it and being rewarded or punished for it.

Explain how our brains process and store information about brands in our memory.

Memory is the storage of learned information. The way we encode information when we perceive it determines how we will store it in memory. The memory systems we call sensory memory, short-term memory, and long-term memory each play a role in retaining and processing information from the outside world in marketing strategies.

Discuss how knowledge about brands is organized in our brains.

Our knowledge of brands is integrated in a complex network of nodes that, when activated, can in turn activate associated nodes. In these networks live consumption constellations and brand knowledge networks.

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CHAPTER OUTLINE I.

How Do We Learn?

Learning is a relatively permanent change in behavior caused by experience. The learner need not have the experience directly, however; we can also learn when we observe events that affect others. We learn even when we don’t try: We recognize many brand names and hum many product jingles, for example, even for products we don’t personally use. We call this casual, unintentional acquisition of knowledge incidental learning.

Psychologists who study learning advance several theories to explain the learning process. These theories range from those that focus on simple stimulus–response connections (behavioral theories) to perspectives that regard consumers as solvers of complex problems who learn abstract rules and concepts when they observe what others say and do (cognitive theories).

A. Behavioral Learning Theories Behavioral learning theories assume that learning takes place as the result of responses to external events.

Two major approaches to learning represent this view: classical conditioning and instrumental conditioning.

B. Classical Conditioning 1. 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 associate it with the first stimulus.

2. Pavlov, a Russian physiologist who conducted research on digestion in animals, first demonstrated this phenomenon in dogs.

3. He paired a neutral stimulus (a bell) with a stimulus known to cause salivation in dogs (meat powder).

• The powder was an unconditioned stimulus (UCS) because it was naturally capable of causing the response.

• Over time, the bell became a conditioned stimulus (CS); it did not initially cause salivation, but the dogs learned to associate the bell with the meat powder and began to salivate at the sound of the bell.

• The drooling of the dogs because of a sound, now linked to food, was a conditioned response (CR).

4. Recent research shows that learning is even more effective through evaluative conditioning. Instead of associating the UCS with a single activating stimulus, the UCS is paired with a series of different stimuli that all trigger the same type of emotional response.

5. Repeated exposures – repetition – increase the strength of stimulus–response associations.

6. Extinction, which happens when the effects of prior conditioning diminish and finally disappear.

C. Marketing Applications of Classical Conditioning Principles Pairing nonsense syllables (meaningless sets of letters) with such evaluative words as .

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beauty or success, transfers the meaning of fake words. These associations are important to many marketing strategies that rely on the creation and perpetuation of brand equity, in which a brand has strong positive associations in a consumer’s memory and commands a lot of loyalty as a result.

1. Marketing Applications of Repetition a. Some research says three exposures to an ad is ideal: 1st exposure creates awareness; 2nd shows relevance of product; 3rd reminds of benefits. b. Advertising wear-out occurs when the marketing stimulus no longer has an impact on the consumer.

2. Marketing Applications of Classical Conditioning Principles: The Halo Effect at Work 1. Stimulus generalization refers to the tendency of stimuli similar to a CS to evoke similar, conditioned responses.

2. The halo effect occurs when people react to other, similar stimuli in much the same way they respond to the original stimulus.

3. Strategies that marketers base on stimulus generalization include: 1. Family branding: Many products capitalize on the reputation of a company name.

2. Product line extension: Marketers add related products to an established brand.

3. Licensing: Companies often “rent” well-known names, hoping that the learned associations they have forged will “rub off” onto other kinds of products.

3. Look-Alike Packaging 1. Companies that make generic or private-label brands and want to communicate a quality image often exploit a linkage with a particular brand with look-alike packaging or putting their products in packages like those of popular brands.

2. Consumer confusion occurs if one company’s logo (design, etc.) is so similar to another that the average consumer has difficulty distinguishing between them.

D. Instrumental Conditioning 1. Instrumental conditioning (or operant conditioning) occurs when we learn to perform behaviors that produce positive outcomes and avoid those that yield negative outcomes.

2. Introduced by B.F. Skinner.

3. We learn the desired behavior over a period of time as a shaping process rewards our intermediate steps.

4. Instrumental conditioning occurs in one of three ways: 1. The environment provides positive reinforcement in the form of a reward, strengthening the response and we learn the appropriate behavior.

2. Negative reinforcement strengthens responses so that we learn the appropriate behavior.

3. Punishment occurs when unpleasant events follow a response. We learn not to repeat these behaviors.

4. When a person no longer receives a positive outcome, extinction is likely to occur, and the learned stimulus-response connection will not be maintained. .

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E. Marketing Applications of Instrumental Conditioning 1. Frequency marketing rewards regular purchasers with prizes that get better the more they spend (e.g., airline frequent flyer programs).

Use Chapter Objective 4-1 Here Use Key Terms learning, incidental learning, behavioral learning theories, classical conditioning, unconditioned stimulus (UCS), conditioned stimulus (CS), conditioned response (CR), evaluative conditioning, repetition, extinction, brand equity, advertising wear-out, stimulus generalization, halo effect, family branding, product line extension, licensing, lookalike packaging, consumer confusion, instrumental conditioning, shaping process, positive reinforcement, negative reinforcement, punishment, and frequency marketing Here Use Review Questions 4-1, 4-2, 4-3, 4-4, 4-14, and 4-18 Here Use Consumer Behavior Challenges 4-20, 4-21, and 4-28 Here

II. Cognitive Learning Theory Cognitive learning theory stresses the importance of internal mental activities.

A. Observational Learning Observational learning occurs when we watch the actions of others and note the reinforcements they receive for their behaviors. In these situations, learning occurs as a result of vicarious rather than direct experience.

Modeling is the process of imitating the behavior of others.

B. How Kids Develop Cognitive Skills Theory of mind is a cognitive skill that refers to knowing and being aware of one’s own and of other people’s mental states: understanding what they think and feel.

Piaget was the foremost proponent of the idea that children pass through distinct stages of cognitive development.

An alternative view suggests three developmental stages: • Limited: Children who are younger than age six do not employ storage-and-retrieval strategies.

• Cued: Children between the ages of six and 12 employ these strategies but only when prompted to do so.

• Strategic: Children 12 and older spontaneously employ storageand-retrieval strategies.

C. Kids’ Message Comprehension Because children differ in their abilities to process product-related information, advertisers’ direct appeals to them raise many serious ethical issues. Beginning in the 1970s, the Federal Trade Commission (FTC) took action to protect children.

Mindfulness is related to the practice of meditation and encourages followers to slow down, tune out distractions, and focus on what they are feeling now.

D. Marketing Applications of Cognitive Principles Our ability to learn vicariously when we observe the outcomes of what others do makes the lives of marketers much easier.

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Use Chapter Objective 4-2 Here Use Key Terms cognitive learning theory, observational learning, modeling, and mindfulness Here Use Review Question 4- 5 Here Use Consumer Behavior Challenges 4-22 and 4-31 Here

III.

Remembering Memory is a process of acquiring information and storing it over time so that it will be available when we need it.

Contemporary approaches to the study of memory employ an information-processing approach.

The memory process (Figure 4.3) entails three stages: • Encoding: information enters in a way the system will recognize.

• Storage: we integrate this knowledge with what is already in memory and warehouse it until it is needed.

• Retrieval: we access the desired information.

A. How Our Brains Encode Information The way we encode information helps to determine how our brain stores it.

In many cases, we encode meanings at a symbolic level, based on the set of associations we hold in the brain’s semantic network.

Episodic memories relate to events that are personally relevant. Some memories are stored in a narrative way, creating a story structure that connects pieces of the event together.

Three memory systems exist: 1. Sensory Memory 1. Sensory memory stores the information we receive from our senses.

2. Short-Term Memory 1. Short-term memory (STM) stores information for a limited time and has limited capacity. This system is working memory. Memories may be either acoustic (sounds) or semantic (meaning).

2. We combine smaller pieces of information into larger chunks of information.

This is known as chunking.

3. Long-Term Memory 1. Long-term memory (LTM) is the system that lets us store information for long periods of time.

2. Elaboration allows information to move from STM into LTM.

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B. What Makes Us Forget?

Forgetting may occur through decay – the passage of time.

Forgetting may also occur through interference – new information replacing old.

Retroactive and proactive interference are two forms of interference.

Sometimes, we just want to forget, known as motivated forgetting.

Memory efficacy – the belief that we will be able to remember things that we are experiencing right now – was directly linked to whether we behave more virtuously.

The Google effect (or digital amnesia) is the tendency for people to rely too heavily on the ability to readily access content online and, as a result, be less likely to remember certain details.

C. What Helps Us Remember?

Although most of the information that enters LTM does not go away, it may be difficult or impossible to retrieve unless the appropriate cues are present.

1. Salience 1. The salience of a brand refers to its prominence of activation in memory.

2. The von Restorff Effect shows that almost any technique that increases the novelty of a stimulus also improves recall.

3. Recall of mixed emotions (those with positive and negative components) occurs differently than unipolar emotions that are either wholly positive or wholly negative.

2. Visual versus Verbal Cues 1. We are more likely to recognize information we see in picture form at a later date.

2. One reason for the power of visuals is that products are important memory markers; they can encapsulate certain time periods, and they serve as a reminder of personal or collective experiences.

3. Photos can serve as a form of memory preservation and ultimately replace the physical object.

3. Creating a Narrative 1. Constructing messages in the form of a narrative helps them resonate with the audience. A narrative is often an effective way to convey product information. Stories help people to construct mental representations of the information they see or hear.

Sometimes instead of creating a whole narrative around their brand, companies just insert their brand in an existing story through product placement.

D. How Do We Measure Consumers’ Memories for Marketing Messages?

1. Recognition versus Recall 1. Two basic measures of impact are recognition and recall.

• In a recognition test, researchers show ads to subjects one at a time and ask if they have seen them before.

• In a free recall test, researchers ask consumers to independently think of what they have seen without being prompted for this information first.

2. Problems with Memory Measures 1. Response bias: people tend to give the answers they believe they are .

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supposed to give. The results we obtain from a measuring instrument are not necessarily based on what we measure, but rather on something else about the instrument or the respondent. This form of contamination is a response bias.

3. Memory Lapses, Biases, and False Memories 1. People are prone to forget information or retain inaccurate memories.

2. A willfully ignorant memory occurs when we “hide our head in the sand” and remember instead only those things we like about the brand.

4. Marketing Applications of Consumers’ Memories 1. Nostalgia describes the emotions that arise when we view the past with both sadness and longing.

2. A retro brand is an updated version of a brand from a prior historical period.

Use Chapter Objective 4-3 Here Use Key Terms memory, encoding, storage, retrieval, semantic network, episodic memories, sensory memory, short-term memory (STM), chunking, long-term memory (LTM), elaboration, decay, interference, motivated forgetting, memory efficacy, the Google effect, salience, the von Restorff Effect, mixed emotions, unipolar emotions, memory markers, memory preservation, narrative, product placement, recognition, recall, response bias, willfully ignorant memory, nostalgia, and retro brand Here Use Review Questions 4-6, 4-7, 4-8, 4-9, 4-10, 4-14, 4-16, and 4-17 Here Use Consumer Behavior Challenges 4-24, 4-26, 4-27, 4-29, 4-30 and 4-32 Here

IV. How do we Organize what we Know?

Our brains like to label and categorize new things we learn to relate these experiences to what we already know about the world. The brain is organized as an associative network that contains many bits of related information.

In the associative network, links form between nodes. Each node represents a concept related to the category.

Spreading activation allows shifting back and forth among levels of meaning.

A. Levels of Knowledge 1. We encode information more readily when that information is consistent with an existing schema.

2. A script is a sequence of events an individual expects to occur. As consumers, we learn scripts that guide our behavior.

B. How Do We Put Products into Categories?

1. Product categories are the building blocks of a market, but sometimes companies like to play with them; they create new ones when they introduce hybrid products that feature characteristics from two distinct domains.

C. “If They Own This, They Must Own That”: Consumption Constellations Networks of brands alongside all the associations we make with them are called consumption constellations.

1. How Do You Learn to be an Expert? .

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a. When consumers are passionate about a topic or product category, they seek more knowledge, and some even develop expertise about certain products or brands. Experts are thirsty for knowledge; they have more elaborate cognitive structures; they remember information better; and they are more efficient at accessing that information. b. Knowledge is constructed not just as a function of cognitive processes that happen in the brain, but also through what is called embodied knowledge. We develop and grow our knowledge through our own actions, and by witnessing others’ actions. Experts develop their knowledge about products not from reading more about them, but also from living them.

D. Marketing Applications of Consumers’ Knowledge Structures The way we categorize products has a lot of strategic implications for marketers.

1. Position a Product The success of a positioning strategy hinges on the marketer’s ability to convince the consumer to consider its product within a given category.

2. Identify Competitors Many different product forms compete for membership. Products and services that on the surface are quite different compete with each other at a broad level for consumers’ discretionary dollars.

3. Create an Exemplar Product The characteristics of category exemplars tend to exert a disproportionate influence on how people think of the category in general.

4. Locate Products in a Store Product categorization can affect consumers’ expectations regarding the places where they can locate a desired product.

5. Create Distinctive Associations A halo effect occurs when associating a brand with images, sounds, or celebrities that generate positive responses.

We retrieve information on a pioneer brand (first brand to enter a market) from memory better than for follower brands.

Use Chapter Objective 4-4 Here Use Key Terms associative network, nodes, spreading activation, script, hybrid products, consumption constellations, experts, knowledge, category exemplars, halo effect, pioneer brand and follower brand Here Use Review Questions 4-11, 4-12, 4-13, 4-15, and 4-19 Here Use Consumer Behavior Challenges 4-23 and 4-25 Here

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End-of-Chapter Support Material REVIEW 4-1.

What is the difference between an unconditioned stimulus and a conditioned stimulus?

Ivan Pavlov, a Russian physiologist doing research on digestion in animals, first demonstrated this phenomenon in dogs. Pavlov induced classically conditioned learning by pairing a neutral stimulus (a bell) with a stimulus known to cause a salivation response in dogs (he squirted dried meat powder into their mouths). The powder was an unconditioned stimulus (UCS) because it was naturally capable of causing the response. Over time, the bell became a conditioned stimulus (CS); it did not initially cause salivation, but the dogs learned to associate the bell with the meat powder and began to salivate at the sound of the bell only. (5 minutes, Chapter Objective 4-1, AACSB: Application of Knowledge)

4-2.

How can marketers use repetition to increase the likelihood that consumers will learn about their brand?

Many classic advertising campaigns consist of product slogans that have been repeated so many times that they are etched in consumers’ minds. Conditioning will not occur or will take longer if the CS is only occasionally paired with the UCS. One result of this lack of association may be extinction that occurs when effects of prior conditioning reduce and finally disappear. This can occur, for example, when a product is overexposed in the marketplace so that its original allure is lost. (5 minutes, Chapter Objective 4-1, AACSB: Reflective Thinking)

4-3.

Why is it not necessarily a good idea to advertise a product in a commercial where a really popular song plays in the background?

A popular song might also be heard in many situations in which the product is not present. When the unconditioned stimulus appears in the absence of the conditioned stimulus, it can lead to extinction of the effect of conditioning. (5 minutes, Chapter Objective 4-1, AACSB: Reflective Thinking)

4-4.

What is the difference between classical conditioning and instrumental conditioning?

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 it is associated with the first stimulus. Instrumental conditioning, also known as operant conditioning, occurs as the individual learns to perform behaviors that produce positive outcomes and to avoid those that yield negative outcomes. (5 minutes, Chapter Objective 4-1, AACSB: Reflective Thinking) .

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4-5.

What is the major difference between behavioral and cognitive theories of learning?

In contrast to behavioral theories of learning, cognitive learning theory approaches stress the importance of internal mental processes. This perspective views people as problem solvers who actively use information from the world around them to master their environment. Supporters of this view also stress the role of creativity and insight during the learning process. (5 minutes, Chapter Objective 4-2, AACSB: Reflective Thinking)

4-6.

Name the three stages of information processing as we commit information about products to memory.

Encoding, storage, and retrieval. (5 minutes, Chapter Objective 4-3, AACSB: Reflective Thinking)

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What is external memory and why is it important to marketers?

During the consumer decision-making process, internal memory is combined with external memory that includes all of the product details on packages and other marketing stimuli that permit brand alternatives to be identified and evaluated. (5 minutes, Chapter Objective 4-3, AACSB: Reflective Thinking)

4-8.

Give an example of an episodic memory.

Episodic memories relate to events that are personally relevant. As a result, a person’s motivation to retain these memories will likely be strong. Couples often have “their song” that reminds them of their first date or wedding or some remember the first time they went on a date or what happened at their high school prom. (5 minutes, Chapter Objective 4-3, AACSB: Reflective Thinking)

4-9.

Why do U.S. phone numbers have seven digits? (not including the area code)?

Initially, researchers believed that STM was capable of processing between five and nine chunks of information at a time, and for this reason, they designed phone numbers to have seven digits. (5 minutes, Chapter Objective 4-3, AACSB: Reflective Thinking)

4-10. List the three types of memory, and explain how they work together.

Sensory memory permits storage of the information we receive from our senses. This storage is temporary; it lasts a couple of seconds at most. Short-term memory (STM) also stores information for a limited period, and it has limited capacity. Similar to a computer, this system can be regarded as working memory; it holds the information we are currently processing. Long-term memory (LTM) is the system that allows us to retain information for a long period. Elaborative rehearsal is required in order for information to enter into long-term memory from short-term memory. This process involves thinking about the meaning of a stimulus and relating it to other .

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information already in memory. (10 minutes, Chapter Objective 4-3, AACSB: Reflective Thinking) 4-11. How is associative memory like a spider web?

Knowledge structures can be thought of as complex spiderwebs filled with pieces of data. This information is placed into nodes connected by associative links within these structures. Pieces of information that are seen as similar in some way are chunked together under some more abstract category. New, incoming information is interpreted to be consistent with the structure already in place. (10 minutes, Chapter Objective 4-4, AACSB: Reflective Thinking) 4-12. How does the likelihood that a person wants to use an ATM machine relate to a schema?

The desire to follow a script or schema helps to explain why such service innovations as automatic bank machines, self-service gas stations, or “scan-your-own” grocery checkouts have been met with resistance by some consumers, who have trouble adapting to a new sequence of events. (5 minutes, Chapter Objective 4-4, AACSB: Reflective Thinking) 4-13. Why does a pioneer brand have a memory advantage over follower brands?

Some evidence indicates that information about a pioneer brand (the first brand to enter a market) is more easily retrieved from memory than follower brands because the first product’s introduction is likely to be distinctive and, for the time being, no competitors divert the consumer’s attention. (10 minutes, Chapter Objective 4-4, AACSB: Analytical Thinking) 4-14. If a consumer is familiar with a product, advertising for it can work both ways by either enhancing or diminishing recall. Why? As a rule, prior familiarity with an item enhances its recall. This is one of the basic goals of marketers who are trying to create and maintain awareness of their products. The more experience a consumer has with a product, the better use he or she is able to make of product information. However, there is a possible fly in the ointment: As noted earlier in the chapter, some evidence indicates that extreme familiarity can result in inferior learning and recall. When consumers are highly familiar with a brand or an advertisement, they may attend to fewer attributes because they do not believe that any additional effort will yield a gain in knowledge. (5 minutes, Chapter Objectives 4-1 and 4-3, AACSB: Reflective Thinking) 4-15. Define nostalgia and tell why it is such a widely used advertising strategy.

We can describe nostalgia as a bittersweet emotion; the past is viewed with both sadness and longing. References to “the good old days” are increasingly common, as advertisers call up memories of youth—and hope these feelings will translate to what .

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they are selling today. (5 minutes, Chapter Objective 4-3, AACSB: Reflective Thinking) 4-16. Name the two basic measures of memory and describe how they differ from one another.

Two basic measures of impact are recognition and recall. In the typical recognition test, subjects are shown ads one at a time and asked if they have seen them before. In contrast, free recall tests ask consumers to independently think of what they have seen without being prompted for this information first—obviously this task requires greater effort on the part of respondents. (15 minutes, Chapter Objective 4-3, AACSB: Reflective Thinking) 4-17. List three problems with measures of memory for advertising.

Three problems with measures of memory for advertising are response biases, memory lapses, and false memories. (5 minutes, Chapter Objective 4-3, AACSB: Reflective Thinking) 4-18. How do different types of reinforcement enhance learning? How does the strategy of frequency marketing relate to conditioning?

Businesses can shape behavior when they gradually reinforce actions with rewards. Instrumental conditioning occurs when behavior produces positive outcomes and we learn to avoid those behaviors that do not produce desired outcomes. Shaping is a reinforcement tool that rewards intermediate actions.

Positive reinforcement strengthens the response, and we learn appropriate behavior. Negative reinforcement also strengthens the response as we learn to avoid a certain behavior. Punishment is an unpleasant event that follows an action.

When a person no longer receives a desired outcome for an action, they will eventually quit performing the action. Frequency marketing rewards regular purchasers with prizes as they spend more. This positive reinforcement encourages consumers to spend more and increases reward levels. (5 minutes, Chapter Objective 4-1, AACSB: Reflective Thinking) 4-19. How does learning new information make it more likely that we’ll forget things we’ve already learned?

Decay causes a structural change in how we learn and remember. Forgetting also occurs because of interference. When we learn new information, it displaces previous information. Because we store information in memory as nodes that link to one another, we are more likely to retrieve a meaningful concept that is connected by a larger number of links. As we learn new information, a stimulus loses its effectiveness in retrieving old responses. (5 minutes, Chapter Objective 43, AACSB: Reflective Thinking) CONSUMER BEHAVIOR CHALLENGE .

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DISCUSS 4-20. To hasten kids’ introduction to social media, a team of Finnish designers invented a block-sorting toy that also works like Twitter. It allows preverbal kids to grab colorful blocks with icons for sleeping, eating, or brushing their teeth; the kids then fit them into slots to indicate what they’re up to. The device then transmits the “status update” to light up the corresponding block-shape on the same toy in another household.

Should very young children be introduced to social media this way?

Answers will vary; some students will think social media is good for young children, while others will think it is bad for young children’s educational growth. (5 minutes, Chapter Objective 4-1; AACSB: Reflective Thinking) 4-21. In his book Blink: The Power of Thinking without Thinking, author Malcolm Gladwell argues that hallowed marketing research techniques like focus groups aren’t effective because we usually react to products quickly and without much conscious thought; thus, it’s better just to solicit consumers’ first impressions rather than getting them to think at length about why they buy. What is your position on this issue?

There are various concepts that students may apply to support both sides of this argument. Both classical conditioning and behavioral instrumental conditioning would support the idea that we make consumer decisions quickly and without much thought. However, cognitive learning theory approaches stress the importance of internal mental processes. This perspective views people as problem solvers who actively use information from the world around them to master their environment. (10 minutes, Chapter Objective 4-1, AACSB: Analytical Thinking) 4-22. Mindfulness training often claims to help people change how they eat, how they work out, and how they study. Do you agree?

Students' responses will vary and provide an interesting discussion. Responses might draw on information presented in the text on mindfulness. (10 minutes, Chapter Objective 4-2, AACSB: Reflective Thinking) 4-23. Research shows that taking photos of experiences with the intention to share them reduces one’s enjoyment of the experience. This happens because the goal of sharing involves the possibility of feeling judged by others. Has that happened to you? Can you describe the experience and the reactions you got to your photos?

Photos can serve as a form of memory preservation. Students will share the varied reactions they got to their photos. This should create a lively discussion on reactions.

(10 minutes, Chapter Objective 4-2, AACSB: Analytical Thinking) 4-24. The “Google effect” describes our tendency to place our trust in a search engine without bothering to think for ourselves. Do you agree that this is a problem? If so, what do you think might be the consequences? Is there any way to prevent “digital .

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amnesia”?

Students’ responses to the “Google effect” and “digital amnesia” will vary. Some may argue that this is not a problem while others consider the consequences of this problem. (10 minutes, Chapter Objective 4-3, AACSB: Reflective Thinking)

4-25.

Even food can facilitate recall: One study looked at how favorite recipes stimulate memories of the past. When the researchers asked informants to list three of their favorite recipes and to talk about these choices, they found that people tended to link them with memories of past events, such as childhood memories, family holidays, milestone events (such as dishes they only make on special holidays, liked corned beef and cabbage of St. Patrick’s Day), heirlooms (recipes handed down across generations), and the passing of time (e.g., only eating blueberry cobbler in the summer). Indeed, one of the most famous literary references is from the classic (3,000 page!) novel Remembrance of Things Past by Marcel Proust. The narrator dips a pastry (a “madeleine”) into his tea, and this action unleashes a flood of memories that drive the rest of the book. How might marketers try to tie these powerful food-related memories to branding strategies?

Students will think of their own memories and how senses can impact their own memories. (10 minutes, Chapter Objective 4-4, AACSB: Analytical Thinking)

4-26. Some die-hard fans were not pleased when the Rolling Stones sold the tune “Start Me Up” for about $4 million to Microsoft which wanted the classic song to promote its Windows 95 launch. The Beach Boys sold “Good Vibrations” to Cadbury Schweppes for its Sunkist soft drink, Steppenwolf offered its “Born to be Wild” to plug the Mercury Cougar, and even Bob Dylan sold “The Times They Are AChangin’” to Coopers & Lybrand (now called PriceWaterhouseCoopers). Other rock legends have refused to play the commercial game, including Bruce Springsteen, the Grateful Dead, Led Zeppelin, Fleetwood Mac, R.E.M., and U2. According to U2’s manager, “Rock ‘n’ roll is the last vestige of independence. It is undignified to put that creative effort and hard work to the disposal of a soft drink or beer or car.”

Singer Neil Young is especially adamant about not selling out; in his song “This Note’s For You,” he croons, “Ain’t singing for Pepsi, ain’t singing for Coke, I don’t sing for nobody, makes me look like a joke.” What is your take on this issue? How do you react when one of your favorite songs turns up in a commercial? Is this use of nostalgia an effective way to market a product? Why or why not?

Student responses on this issue will range from support to opposition of artists selling songs for commercial application. Their reasons for either will also vary.

Some will like hearing familiar songs in commercial jingles because it grabs their attention, is more relevant to them, or prompts them to recall fond memories. Some will express support simply because it is the artists’ prerogative to sell what is theirs.

Others will oppose this practice for reasons similar to those expressed by the artists mentioned. It is likely that among business and marketing students, however, most will find nothing wrong with the commercial application of popular songs. Responses should reflect the concept that nostalgia in marketing can be effective because it can .

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prompt positive emotions in consumers. (15 minutes, Chapter Objective 4-3, AACSB: Analytical Thinking) 4-27. The chapter discusses the possibility that our increasing reliance on apps to search for information is diminishing our natural abilities to think for ourselves. Do you agree?

This question should generate quite a bit of discussion. Memory is defined as a process of acquiring information and storing it over time so that it will be available when we need it. If we use an app to find our information for us constantly, the argument could be made that we no longer have the need to remember. (25 minutes, Chapter Objective 4-3, AACSB: Reflective Thinking) 4-28. New passive monitoring systems allow us to pay tolls automatically or simply show our phones equipped with systems like Apple Pay. Convenient, for sure. But these systems also eliminate the transparency of the connection between the stimulus and the response. As a result, we don’t think as much about the costs when we use them. Is this a problem for consumers?

Student responses will vary. Some students will agree with the idea that the connection between the stimulus and the response is in some way broken. Other students will view this new payment process as just an evolution of the time-honored methods of payment that have been in use for years. (15 minutes, Chapter Objective 4-1, AACSB: Reflective Thinking) 4-29. The Snapchat app provides a way for social media users to share content that disappears after a brief time with their friends. In Europe, Google is fighting an intense legal battle over what some call the “right to be forgotten”; users want the option to dictate to Google whether it will be allowed to display results when people search about them. On the other hand, some people who believe that “information wants to be free” say that if a person posts online it should be with the expectation that the content will be permanent and that you forfeit control over others’ right to access it. Which argument is correct?

Student responses will vary greatly based upon personal feelings. (20 minutes, Chapter Objective 4-3, AACSB: Reflective Thinking; Ethical Understanding and Reasoning)

APPLY 4-30. Devise a product jingle memory test. Compile a list of brands that are or have been associated with memorable jingles, such as Chiquita Banana, Alka-Seltzer, McDonald’s, or even webuyanycar.com. Read this list to friends and see how many jingles are remembered. You may be surprised at the level of recall.

Students should be able to generate many product jingles for this “memory test.”

Most of these will be highly advertised products that students have been exposed to .

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recently. It might be surprising to note that many of the advertised products are not targeted at the student/consumer, and yet they will have high levels of recall for the jingles. As the instructor, you may want to develop your own list of older jingles (many of which the students will not remember) that students will find interesting, such as those based on older, popular songs (i.e., “I’d like to buy the world a Coke”).

(75 minutes, Chapter Objective 4-3, AACSB: Reflective Thinking) 4-31. A physician borrowed a page from product marketers when she asked their advice to help persuade people in the developing world to wash their hands habitually with soap. Diseases and disorders caused by dirty hands—like diarrhea—kill a child somewhere in the world about every 15 seconds, and about half those deaths could be prevented with the regular use of soap. The project adapted techniques that major marketers use to encourage habitual product usage of items such as skin moisturizers, disinfecting wipes, air fresheners, water purifiers, toothpaste, and vitamins. For example, beer commercials often depict a group of guys together, because research shows that being with a group of friends tends to trigger habitual drinking! The researchers found that when people in Ghana experienced a feeling of disgust, this was a cue to wash their hands. However, as in many developing countries, toilets are actually a symbol of cleanliness because they have replaced pit latrines. So, an advertising campaign included messages that reminded people of the germs they could still pick up even in modern bathrooms— mothers and children walked out of restrooms with a glowing purple pigment on their hands that contaminated everything they touched. These images in turn triggered the habit of hand washing and the project resulted in a significant increase in the number of consumers who washed their hands with soap. How can other organizations that work to improve public health, the environment, or other social issues harness our knowledge about consumer learning and habitual behavior to create or reenergize positive habits?

This would make an excellent take-home assignment with a discussion following during a later class. Consider assigning specific organizations or public health initiatives to students to contemplate how to apply marketing persuasion principles.

Students should recognize the application of instrumental conditioning. Focus student work on schemas and priming. These are likely areas that will apply to public initiatives. (45 minutes, Chapter Objective 4-3, AACSB: Reflective Thinking) 4-31. Collect some pictures of “classic” products that have high nostalgia value. Show these pictures to others and allow them to free associate. Analyze the types of memories that are evoked and think about how a marketer might employ these associations in a product’s promotional strategy.

Consumers’ responses to “classic” product pictures should prove interesting to students. They should be encouraged to evaluate the types of meaning associated with products and asked to determine the relative effectiveness of various messages for different target consumer groups. The real emphasis, however, should be placed on students’ recommendations for translating the special meaning of these products for consumers into effective promotional messages. (15 minutes, Chapter Objective 4-2, AACSB: Analytical Thinking) .

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CASE STUDY TEACHING NOTES Chapter 4 Case Study: Kidfluence and Kidfluencers – Marketing to Children Responsibly Summary of Case Much money is spent on products for children and children influence other purchases that are not exclusively for kids. This “kidfluence” effect has caused marketers to focus significant promotional effort on these young consumers. But since children’s brains and decision-making abilities are still developing, companies marketing to them should make sure they are doing so in a responsible and ethical manner.

Brain science helps explain how kids respond to marketing messages. Social media is frequently used to advertise to kids and has also led to the rise of a particular kind of spokesperson – “kidfluencers” -influencers who are kids themselves. Recognizing the need to be careful when marketing to children (and in response to public pressure), advertisers and social media companies have taken steps to help ensure a more responsible approach when advertising to and providing content to children.

Suggested Answers for Discussion Questions CS 4-1.

Discuss some of the ways that the limited decision-making and self-control capabilities of young children could lead them to make inaccurate assessments of advertising messages.

Use examples to illustrate.

Children may not be able to distinguish between advertising “puffery” and factual information about the products. A claim that a toy car is the “fastest car ever!” may be interpreted as the fastest among all available toy car options.

Very young children may see cartoon or computer-generated graphics depicting children playing with toys and conclude that the product is bigger or have more functionality than it actually does. For example, an ad may show children riding in a toy rocket and the child may expect to get a ride to the moon.

Children may not be able to fairly weigh the claims of actors or spokespeople in advertising.

If a child actor in an ad says a toy is “the best toy I’ve ever played with!” the child may conclude that this is an authoritative assessment of the quality of the product.

(10 minutes, Chapter Objective 4, AACSB: Reflective Thinking)

CS 4-2.

If you were designing an ad campaign directed at 6-10-year-old kids, what principles could you use to ensure that you are communicating to them in an appropriate and responsible manner, while still promoting your product?

Students’ answers will vary. Some possible principles: •

Ensure that words used are all age appropriate and not confusing, subject to interpretation, or able to be “taken” multiple ways. .

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• • •

Graphics, cartoons, and CGI depictions of the product should be sized in proportion to the size of children being targeted for the product.

Action toys should show a realistic depiction of how the product moves and how it is used in play.

Ads should be tested with a panel of children with questions focused on assessing children’s accurate understanding of the product’s functionality after viewing the ads.

Other principles can be found in this review of the Children’s Advertising Review Unit’s Revised Guidelines for Children’s Advertising. CARU is a division of the Better Business Bureau. https://www.natlawreview.com/article/caru-s-revised-guidelines-children-s-advertisingwhat-they-mean-marketers (10 minutes, Chapter Objective 4, AACSB: Application of Knowledge) CS 4-3.

What are the risks to the children serving as kidfluencers who are allowed by parents (and encouraged by marketers and fans) to take on this role? What limitations regarding kidfluencers, if any, should advertisers voluntarily agree to and/or legislators enforce by law?

Similar to risks associated with child actors or other young entertainers, there are risks ranging from overscheduling to depression that results from overwork and neglecting normal interactions with other children. A primary concern could be the impact of time spent on influencer activity that negatively affects children’s educational and social development.

Responsible advertisers and advertising professional organizations can suggest limits on influencer activity, including the frequency of social media posts and time intervals between the creation of YouTube videos.

As more children become involved in influencer marketing, states may choose to include them under existing laws that apply to children in the entertainment industry. See this website for summaries of regulations by state: https://www.dol.gov/agencies/whd/state/child-labor/entertainment#:~:text=Yes,Sec.,employment%20in%20the%20entertainment%20industry.&text=Title%2026%20Sec.,th ey%20must%20have%20work%20permits (10 minutes, Chapter Objective 2, AACSB: Reflective Thinking)

MULTIPLE CHOICE QUESTIONS 1. Advertising targets the brain’s limbic system, which is in charge of a person’s a. sensing of stimuli like the senses of smell and touch. b. emotional responses. c. interpretation of color. .

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d. cognitive behavior like decision-making skills and self-control. e. ability to move one’s limbs (arms and legs).

Correct answer: b The limbic system is in charge of our emotional responses. Intense stimuli like loud noises, quick motion, and bright colors cause neural pathways to send messages that result in joy and excitement and trigger the release of “feel-good” chemicals like dopamine and endorphins.

2. An important part of brain physiology is the prefrontal cortex which is responsible for a. interpretation of color. b. interpretation of sounds. c. emotional responses. d. cognitive behavior like decision-making skills and self-control. e. ability to interact with others.

Correct answer: d The prefrontal cortex is responsible for cognitive behavior like decision-making skills and self-control.

3. The prefrontal cortex is not fully developed until about age a. 25. b. 50. c. 4. d. 18. e. The prefrontal cortex continues to develop throughout one’s life.

Correct answer: a The prefrontal cortex is not fully developed until a person is about 25 years old.

4. A key reason that influencers are so effective in marketing is that a. consumers consider influencers as more trustworthy and relatable than traditional “celebrities” because they are “everyday people.” b. influencers typically have advanced degrees or other credentials. c. influencers are required to be certified by the American Marketing Association. d. influencers tend to be slightly older than those they are influencing, giving them an air of maturity and authority. e. influencers are not financially compensated, making their advice more credible.

Correct answer: a Research has shown that consumers consider influencers as more trustworthy and relatable than traditional “celebrities” because they are “everyday” people.

5. In response to concerns about advertising’s impact on children, advertisers and/or social media companies a. have taken little or no action. b. have stopped advertising to people under the age of 18. c. no longer use children as actors or spokespeople in their ads. d. have limited the collection of data on individual kids for targeting purposes. e. require confirmation that an adult is present before playing social media video ads targeted toward children.

Correct answer: d Walt Disney Co. decided not to show preschoolers ads on its Disney+ service and will not collect data on individual kids for targeting purposes. Google and Facebook parent Meta no longer allow adtargeting to people under 18. .

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Additional Support Material STUDENT PROJECTS Individual Projects 1.

Ask students to visit a grocery store or a similar retail setting and discreetly observe the behavior of individual shoppers and groups of shoppers for an extended period.

Have them record any behaviors that they witness that could be examples of the following concepts: vicarious learning, incidental learning, classical conditioning, and instrumental conditioning. Have students present their findings to the class or discuss them in groups.

Some of these learning examples may be challenging to observe directly. Students may need to draw on their own exposure to marketing communications and make inferences about why consumers are behaving as they are. Vicarious learning examples should reference the idea that the consumer learned by watching someone else’s behavior and whether s/he received positive or negative reinforcement for that behavior. Incidental learning examples should reference the idea that the consumer learned about the product without necessarily having an interest in the product or product category. Classical conditioning examples will probably be the easiest to observe because the applications of stimulus generalization and the repetition of likable spokes-characters or endorsers as cues are likely to be present. Instrumental conditioning examples may include frequency rewards or gifts with purchase. (45 minutes, Chapter Objectives 4-1, 4-2, AACSB: Application of Knowledge)

2.

Have students recall their first act of “green” consumption. Ask them to list the product involved and the sequence of actions they took. Ask them why they remembered it and how significant that was to their subsequent behaviors.

This individual project can be modified to reflect a number of consumption acts. If you choose to use green consumption, it provides an opportunity to tie the exercise to the concept of green marketing (chapter 1) and perceptions (chapter 2). To relate the project to the current chapter, help students identify how the consumption event is associated with other nodes in their minds and ask them to reflect specifically on how repetition or rehearsal may have strengthened the associations to help them recall the specific event. (45 minutes, Chapter Objective 4-4, AACSB: Reflective Thinking)

3.

Ask students to narrate the sequence of events that led to their first access and registration at a social networking site (www.facebook.com, www.myspace.com, www.orkut.com, or others). Have them list some of the positive and negative reinforcements they have encountered at the site since they joined.

The exercise reinforces applications of instrumental conditioning of the consumer .

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decision-making process, which will be explored in greater depth later in the text.

It is important to note whether students distinguish between positive reinforcement (the presence of a reward in exchange for their behavior) and negative reinforcement (avoiding a negative outcome or the absence of a reward). In the context of Facebook, students may feel rewarded when someone likes their status.

Students may also join or participate to avoid feeling left out or lonely because they do not see updates from others. (25 minutes, Chapter Objective 4-1, AACSB: Reflective Thinking) 4.

Have students devise their own classical conditioning experiments involving a “green” product such as organic milk or similar products. Let them utilize UCS, CS, and CR. Look for students to identify the part of their experiment that is the unconditioned stimulus (UCS), which generates the desired response on its own; the conditioned stimulus (CS), which generates the response because of its association with the unconditioned stimulus; and the (desired) conditioned response (CR) that should ultimately be associated with the conditioned stimulus. (30 minutes, Chapter Objective 4-1, AACSB: Reflective Thinking)

5.

Many brands attempt to capitalize on positive associations that consumers have for competing brands by copying certain characteristics. Have students identify an example of this and relate it to the halo effect.

Students are likely to bring examples of private label or generic brands that try to leverage similar packaging to capitalize on consumers’ positive associations with national brands. (15 minutes, Chapter Objective 4-1, AACSB: Reflective Thinking)

6.

Ask students to write their favorite brand name. They should then draw an associative network around the brand that includes three attributes/features, three benefits, three competitors, attributes, and benefits for the competing brands, etc.

They can be allowed to add personal opinions and feelings about the brand to the network.

The exercise should help students visualize the web of connections between nodes that characterize the associative network theory of memory. You can tie the exercise to further exploration of the concept of the evoked set (since they identify competitors). Since they start with brand identification, ask them to identify when the related nodes are brand-specific (claims), ad specific, product category specific, or related to evaluative reactions (positive or negative emotions). (20 minutes, Chapter Objective 4-4, AACSB: Reflective Thinking)

7.

Have students create their schema for “made in the U.S.,” “made in Japan,” and “made in Germany” cars. What features and attributes would they include in each of the schemas?

Student associations with each schema will vary. Look for students to recognize that .

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a schema is a cognitive framework that is developed through experience. Remind students that it is easier for consumers to encode information that is consistent with an existing schema than it is to encode information that is incongruent with our expectations based on experiences. (20 minutes, Chapter Objective 4-3, AACSB: Reflective Thinking) 8.

Assign students to locate a print advertisement that is a clear example of a marketer employing the concepts of stimulus generalization or stimulus discrimination. Have students present the ads to the class.

For stimulus generalization, students may select private label/generic brands that are packaged to look like the national counterpart, examples of companies that use family branding, product line extensions, or brands that license a brand name. For stimulus discrimination, students are likely to find examples where a national brand clarifies what distinguishes its brand from private label/generic competitors, and/or urges consumers not to settle for cheap imitations. (20 minutes, Chapter Objective 41, AACSB: Reflective Thinking and Written and Oral Communication)

9.

Have students identify an example of both positive reinforcement and negative reinforcement in a marketing context. As students present their findings in class, have the class discuss how effective each example is at establishing the desired or intended behavior.

Examples will vary. In addition to looking for students to differentiate between positive and negative reinforcement, also look for evidence that they understand the difference between negative reinforcement and punishment. (30 minutes, Chapter Objective 4-1, AACSB: Reflective Thinking and Written and Oral Communication)

10.

Ask students to observe their friends, roommates, and co-workers for an extended period to identify an incidence of modeling as it relates to a celebrity. Have them note how the four conditions of modeling are met. Is the celebrity a brand endorser?

How might their behavior be positive/negative for the marketers of the brands(s) that the celebrity endorses?

The four conditions the student should include in his/her response include: • The consumer’s attention must be directed to a model that is desirable to emulate for reasons of attractiveness, competence, status, or similarity.

• The consumer must remember what is said or done by the model.

• The consumer must convert this information into actions.

• The consumer must be motivated to perform these actions.

When celebrities are paid endorsers of a product, students may respond differently than if the celebrity appears to wear or use a product without being compensated.

However, many students recognize that celebrities are given products in the hopes they will use them and influence others to use them. When you speak about negative effects of celebrity behaviors, students may think of Tiger Woods. You may also bring up the publicity stunt from Abercrombie & Fitch where they announced they would pay cast members of MTV’s show Jersey Shore not to wear their apparel because .

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they did not want to be associated with the cast members’ images (Summer 2011). (90 minutes, Chapter Objective 4-2, AACSB: Reflective Thinking and Written and Oral Communication) 11.

Have students think of specific examples where their sensory, short-term, and longterm memory have been activated by marketing information.

Sensory memory is activated when consumers are exposed to marketing stimuli. If the information passes through an attentional gate, it can be stored acoustically or semantically for a short period in short-term memory. To make it to long-term memory, students should recognize marketing efforts to increase the likelihood of rehearsal (e.g., repetitions, catchy slogans/jingles). (15 minutes, Chapter Objective 43, AACSB: Reflective Thinking)

12.

Ask each student to complete the following assignment based on a popular national brand: Collect as many pieces of promotional material (ads, direct mail, etc.) as possible for the brand. Based on this promotional evidence, identify any bits of information that marketers intend to be associated with the brand. Create an associative network for the brand, integrating the documented nodes of information with other nodes.

This project gives students the opportunity to create a model from marketing stimuli instead of their memories, which may give them a different perspective on what the brand marketers are trying to communicate. It may provide an interesting discussion to compare what the student recalled on his/her own about the brand to what the marketing materials are trying to communicate, and why there are differences.

Students will need time (1-2 weeks) to collect the marketing materials for the brand.

Students will most likely identify nodes associated with brand claims, the ads, and the product category. (75 minutes, Chapter Objective 4-4, AACSB: Reflective Thinking)

13.

Assign each student to ask three friends to list as many brands as they can remember for a product class of their choosing. Have them ask each friend questions about each brand on the list to get a better idea of why each might have been recalled. Then, have them identify whether familiarity, salience, or other factors influencing recall were present. Were there differences between the first brands recalled and the others?

In general, familiarity with a brand, the salience/importance of the brand, and the novelty associated with the presentation of the brand are likely to enhance its recall.

The exercise provides students with an opportunity to analyze the role of each factor for their friends, which should help reinforce how these factors affect recall. (45 minutes, Chapter Objective 4-4, AACSB: Analytical Thinking)

Group Projects 1.

Create a long list of brand slogans from the past 10 or more years—e.g., Ford, where quality is job one; I want my MTV; Always Coca-Cola; Pizza-pizza (Little Caesar’s); BMW: the ultimate driving machine. Divide the class into teams or .

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simply in half. Read the brand slogans one at a time, omitting the brand name.

Award points to the first team to correctly identify the brand associated with each slogan. Afterward, point out how memory was strong, even for older slogans (some may be able to identify slogans from when they were very young children). Discuss why this is the case according to the principles of memory in the chapter.

Students should recognize that they are retrieving brand information from long-term memory. They may note differences are cognitive, physiological, and situational factors that helped them retrieve (or caused them to forget) the slogans. Depending on the brands selected, they also may recognize stronger memories for pioneering brands and the effects of the brand spacing out repeated messages. (20-30 minutes, Chapter Objective 4-4, AACSB: Reflective Thinking) 2.

Match the brand name to the slogan in class. Provide a list of 10 or 20 brand names along with as many slogans and have groups match them. As a homework assignment, they can then be asked to assume the role of an advertising agency and try to develop better (or humorous) slogans for these products. These can be presented in class and students can vote on the best slogans that were developed.

This is a fun exercise and can help reinforce the idea that salience and novelty contribute to recall. The homework assignment is an opportunity for students to flex their creative muscles and the competitive aspect may be enjoyable for the students. (20-30 minutes, Chapter Objective 4-4, AACSB: Reflective Thinking)

3.

Have student groups design an experiment that would demonstrate the occurrence of either classical conditioning or instrumental conditioning. Have them conduct their experiment on members of the class.

Individual project idea #4 asks an individual student to design an experiment to demonstrate the occurrence of classical conditioning. If students select classical conditioning, ask them to identify the part of their experiment that is the unconditioned stimulus (UCS), which generates the desired response on its own; the conditioned stimulus (CS), which generates the response because of its association with the unconditioned stimulus; and the (desired) conditioned response (CR) that should ultimately be associated with the conditioned stimulus.

For instrumental conditioning, ask them to identify the behavior, the reward, and the desired consumer response. (45 minutes, Chapter Objective 4-1, AACSB: Reflective Thinking)

4.

Have student groups visit a grocery store. How are marketers taking advantage of consumer ability to “chunk” information through strategies used on packaging?

Brand names (which represent a chunk of information about the brand), images, and product descriptors on labels (e.g., natural, which represents a chunk of associations with the word) are likely to show up in student responses. (30 minutes, Chapter Objective 4-3, AACSB: Reflective Thinking,)

.

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5.

Ask groups of students to design an experiment to test the process of state-dependent retrieval. Have them conduct the experiment on ten individuals, five in a moodcongruent condition and five in a mood-incongruent condition. Have the groups present their experiments and findings to the class.

Students may use films or candy to alter moods, and should maintain a common recall task across the two groups so the mood congruency is the only manipulated variable. (90 minutes, Chapter Objective 4-3, AACSB: Analytical Thinking and Written and Oral Communication)

6.

Have student groups create a list of things that make them nostalgic. Then, during a period of a few days, have each of them identify ways that marketers of products targeted toward them have focused on any of these elements of nostalgia. Can they identify any nostalgia brands that are focused on their feelings of nostalgia? Have them share their findings with group members.

Student responses should reflect their understanding that nostalgia describes a bittersweet emotion where we view the past with both sadness and longing. Student examples are likely to include music, food, and beverages, which are often salient to students. Nostalgia brands may include retro brands (e.g., the Snoopy Sno Cone Machine that was recently reintroduced by Sababa Toys). (20-30 minutes, Chapter Objective 4-4, AACSB: Reflective Thinking)

ONLINE ASSIGNMENTS Individual Assignments 1.

Go to www.levis.com. Levi Strauss is a brand that is 150 years old. However, the long-dominant player in the jeans and apparel industry has struggled in recent years to regain market share that it has lost to brands that are more youthful. Visit their website and discuss what strategies the company appears to be using to attract Generation Y (30 million plus individuals born between 1986 and 2002). What forms of learning is the company attempting to use to reacquire a youthful audience? Be specific in your description and provide illustrations of your ideas from the website to support chapter concepts.

Levis.com promotes its products with appeals to individualism, innovation/progress, achievement, and social activism. They use social media (blogs, Facebook, Twitter, and mobile updates) to communicate with and connect to their target audience. They may use rewards to motivate some behaviors (e.g., free shipping for a purchase > $100; sign up for email and we’ll give you a code for free shipping) and they use attractive models to display their apparel. Students may categorize the use of the attractive model as an effort to encourage observational learning or they may categorize it as an application of classical conditioning, since the marketer may anticipate positive feelings toward the model will transfer to the apparel s/he is wearing. Students may also identify a second application of classical conditioning: .

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the efforts toward social activism may generate goodwill that transfers to Levi’s. (25 minutes, Chapter Objective 4-2, AACSB: Reflective Thinking,) 2.

Go to www.gogorillamedia.com. Become familiar with the advertising product offerings from this company. What previously useless space is this company turning into valuable advertising space? What advertisers might be most interested in the various types of ad space options? How would each affect learning and memory?

What memory processes would be most critical to the success of the different ad options?

The URL directs students to a blog for an agency that specializes in non-traditional media, including guerrilla marketing. Different ad space options may help firms break through advertising clutter, which will increase the likelihood of exposure.

Exposure is a key to familiarity. Novel stimuli are also more likely to be recalled.

This includes novel presentations of messages, like those offered by non-traditional media. Students can reference Figure 4.3, which summarizes the memory process.

(20 minutes, Chapter Objective 4-3, AACSB: Reflective Thinking)

.

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Chapter 5: Motivation

Chapter 5: Motivation

CHAPTER OBJECTIVES When students finish this chapter, students should be able to: 5- 1. Understand how motivation can be intrinsic or extrinsic.

5- 2. Outline how products can satisfy a range of consumer needs.

5- 3. Discuss how setting goals correctly can motivate consumers to strive toward and achieve those goals.

5- 4. Explain how the way we evaluate and choose a product depends on our degree of involvement with the product, the marketing message, or the purchase situation.

CHAPTER SUMMARY Understand how motivation can be intrinsic or extrinsic.

Motivation refers to the processes that lead people to behave as they do. It occurs when a need that the consumer wishes to satisfy is activated. The need creates a state of tension that drives the consumer to attempt to reduce or eliminate it. The motivation can be intrinsic, pulling from the person’s inherent drives, or it can be extrinsic, pushed by an external force.

Outline how products can satisfy a range of consumer needs.

Marketers try to satisfy consumers’ needs, but the reason any product is purchased can vary widely. The identification of consumer motives is an important step to ensure that a product will meet the appropriate need(s). Traditional approaches to consumer behavior have focused on the ability of products to satisfy rational needs (utilitarian motives), but hedonic motives (such as the need for exploration or fun) also guide many purchase decisions. Maslow’s hierarchy of needs demonstrates that the same product can satisfy different needs.

Discuss how setting goals correctly can motivate consumers to strive toward and achieve those goals.

When we set goals deliberately, when we monitor goal progress, and when we are committed to reaching the goal, we are most likely to achieve it. Consumers experience different kinds of conflicts that can impact their purchase decisions, such as approach–approach and approach– avoidance conflicts. A goal has valence, which means that it can be positive or negative. We direct our behavior toward goals we value positively; we are motivated to approach the goal and to seek out products that will help us to reach it. In general, the higher we set our goals, the better we perform. One way to encourage people to set even higher goals for themselves is to frame them correctly. Some factors that influence the results include the time frame, specificity, and difficulty of the goal. .

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Explain how the way we evaluate and choose a product depends on our degree of involvement with the product, the marketing message, or the purchase situation.

Product involvement can range from low, where consumers make purchase decisions based on inertia, to high, where they form strong bonds with favorite brands (cult products). Marketing strategies also need to consider consumers’ extent of engagement with the messages about their products and the environments in which consumption of these products occurs.

CHAPTER OUTLINE I.

The Motivation Process: Why Ask Why? To understand motivation is to understand why consumers do what they do.

A. Push or Pull? Intrinsic versus Extrinsic Motivation 1. Motivation refers to the processes that lead people to behave as they do. It occurs when a need that the consumer wishes to satisfy is aroused. The desired end state is the consumer’s goal. Marketers try to create products and services to provide the desired benefits and help the consumer to reduce this tension.

2. Motivation can be intrinsic or extrinsic. Intrinsic motivation occurs when a person pulls from their own inherent drives; extrinsic motivation occurs when a person is pushed by an external force. The placebo effect demonstrates the power that intrinsic motivation plays on our feelings. It refers to the welldocumented tendency for your brain to convince you that a fake treatment is the real thing.

3. Metamotivation refers to people’s understanding of their own personal motivational states and the best ways to motivate themselves.

4. Many programs are designed to create external incentives to motivate consumers.

5. Achievement motivation refers to wanting to do well and trying to achieve some standard of excellence, whether that standard is conscious or nonconscious.

B. Motivational Drive 1.Drive Theory a. Whether the need is utilitarian or hedonic, the magnitude of the tension it creates determines the urgency the consumer feels to reduce it. We call this degree of arousal a drive. b. Drive theory focuses on biological needs that produce unpleasant states of arousal. The arousal this tension causes motivates us to reduce it and return to a balanced state called homeostasis. Retail therapy – the act of shopping to restore balance in life – is an example.

2. Nonconscious Goals Even goals that we are not aware of (nonconscious goals) can have a strong impact on our choices.

C. Self-Regulation 1. Self-regulation describes our ability to monitor and manage our own emotions, .

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thoughts, and behavior. Psychologists tout it as the most fundamental skill to be successful at many tasks. Having a self-regulatory strategy means that we specify in advance how we want to respond in certain situations. These “if-the” plans, or implementation intentions, may dictate how much weight we give to different kinds of information, a timetable to carry out a decision, or even how we will deal with disruptive influences that might interfere with our plans.

2. A recent study distinguished between two types of motivation: promotion motivation encourages people to focus on hopes and aspirations, while prevention motivation focuses on responsibilities and duties as it prompts people to think about avoiding something negative.

3. A biohacker is a person who meticulously monitors their bodily processes and vital signs with the intent of creating a superhuman race. The self-recording of personal data is a hallmark of the quantified self (QS) movement.

Use Chapter Objective 5-1 Here.

Use Key Terms motivation, goal, intrinsic motivation, extrinsic motivation, Metamotivation, external motivation, drive, drive theory, homeostasis, retail therapy, nonconscious goals, self-regulation, implementation intentions, promotion motivation, prevention motivation, biohacker, and quantified self (QS) movement Here.

Use Review Questions 5-1, 5-4, and 5-5 Here.

Use Consumer Behavior Challenges 5-9, 5-10, and 5-13 Here.

II.

Consumer Needs A. Utilitarian and Hedonic Needs 1. A need reflects a basic goal such as keeping yourself nourished or protected from the elements. A want is a specific pathway to achieving this objective.

When we focus on a utilitarian need, we emphasize the objective, tangible attributes of products. Hedonic needs are subjective and experiential.

2. Hedonic consumption refers to the multisensory, fantasy, and emotional aspects of consumers’ interactions with products.

B. How Can We Understand Needs?

1. Maslow’s Hierarchy of Needs a. The Hierarchy of Needs was originally developed to understand personal growth and how people attain spiritual “peak experiences.” Marketers later adapted the work to understand consumer motivations. b. Maslow’s hierarchical structure implies that the order of development is fixed—that is, we must attain a certain level before we activate a need for the next, higher one. (Figure 5.2) c. The Great Resignation we witnessed in the years after the pandemic as workers rethought what they wanted to do to make a living relates to the quest for meaning. d. The order of the hierarchy is: • Physiological .

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• Safety • Social • Esteem • Self-actualization • Self-transcendence 2. Terror Management Research on terror management theory shows that making people conscious of their own death activates safety needs and motivated people to engage in healthier behavior.

Mortality salience makes people more likely to engage in materialistic and self-serving behavior.

3. Self-Determination According to self-determination theory, humans are intrinsically motivated by the innate psychological needs for autonomy, relatedness, and competence: a. Autonomy refers to the experience of volition and willingness. b. Relatedness refers to the experience of warmth, bonding, and care, and is satisfied by connecting to and feeling significant to others. c. Competence is the belief in one’s ability to perform essential tasks.

C. How “Needy” Are You? Individual Differences in Motivation Some important needs that are relevant to consumer behavior include: 1. Need to belong 2. Need for power 3. Need for uniqueness 4. A fresh start mindset is the belief that people can change their own destiny and get a fresh start, get a new beginning, and chart a new course in life, regardless of their past or present circumstances.

5. A new school of thought says that grit, a combination of passion and long-term perseverance toward one’s goals, is even more important than genius. One analysis suggested that grit is very strongly correlated with conscientiousness, the ability to be organized, responsible, industrious, and reliable, and that it may be conscientiousness and not grit per se that drives succeeding in one’s goals.

Use Chapter Objective 5-2 Here.

Use Key Terms hedonic consumption, hierarchy of needs, terror management theory, mortality salience, self-determination theory, autonomy, relatedness, competence, fresh start mindset, grit and conscientiousness Here.

Use Review Question 5-3 Here.

Use Consumer Behavior Challenges 5-11 and 5-13 Here.

III.

Setting and Reaching Goals A. Goal Conflicts Consumers experience different kinds of motivational conflicts that can impact their purchase decisions. .

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A goal has valence, which means that it can be positive or negative. We direct our behavior toward goals we value positively; we are motivated to approach the goal and to seek out products that will help us to reach it.

Because a purchase decision can involve more than one source of motivation, consumers often find themselves in situations in which different motives, both positive and negative, conflict with one another. Marketers attempt to satisfy consumers’ needs by providing possible solutions to these dilemmas. (Figure 5.3) 1. Approach-Approach Conflict a. Approach-approach conflict occurs when a person must choose between two desirable alternatives. b. The theory of cognitive dissonance is the idea that people have a need for order in their lives and that a state of dissonance (tension) exists when beliefs or behaviors conflict with one another. We resolve the conflict that arises when we choose between two alternatives through a process of cognitive dissonance reduction. c. Postdecision dissonance occurs when a consumer must choose between two products, both of which possess good and bad qualities.

2. Approach-Avoidance Conflict a. Approach–avoidance conflict occurs when we desire a goal but wish to avoid it at the same time.

3. Avoidance-Avoidance Conflict a. Avoidance-avoidance conflict is a situation that contains only undesirable alternatives (“caught between a rock and a hard place”).

B. Goal Framing Affects Goal Completion In general, the higher we set our goals, the better we perform. A relatively easy way to encourage people to set even higher goals for themselves is to frame them correctly. A frame is simply a way of presenting information to change how it may be processed and interpreted.

1. Positive and Negative Frames Recent research finds that when they set goals, consumers can decide how many goal-consistent activities to undertake or how many goal-inconsistent activities to forego. In other words, they can apply positive or negative frames that influence how hard they will work to achieve the goal.

2. Ends versus Means When they pursue a goal, consumers generally have one of two mindsets: an outcome-oriented mindset (focusing on what the outcome will look like) or an implemental mindset (focusing on how to reach that outcome).

3. The Time Frame A set of research studies illustrates that the way you describe the amount of time available to complete a task – the time frame – makes a difference.

According to studies on the mere urgency effect, we tend to choose to perform urgent tasks with short completion windows, compared to more important tasks. This tendency to pursue urgency over importance happens because urgent tasks bring more immediate and certain outcomes, and we want to finish the urgent tasks first and then work on important tasks later.

4. Goal Difficulty and “Emergency Reserves” .

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Hard goals can lead to better success and greater satisfaction. The key is to make sure to have emergency reserves. These reserves provide a type of slack in our goal pursuit in case we fail.

5. Goal Specificity Goals cannot be too generic. They must be specific.

Use Chapter Objective 5-3 Here.

Use Key Terms approach-approach, theory of cognitive dissonance, approach-avoidance, avoidance-avoidance, positive or negative frames, outcome oriented mindset, implemental mindset, time frame, mere urgency effect, and emergency reserves Here.

Use Review Question 5-2 Here.

Use Consumer Behavior Challenge 5-12 Here.

IV.

Consumer Involvement Involvement is a person’s perceived relevance of the object based on their inherent needs, values, and interests. (Figure 5.4) A person’s degree of involvement is a continuum that ranges from absolute lack of interest in a marketing stimulus at one end to obsession at the other. Inertia describes consumption at the low end of involvement, where we make decisions out of habit because we lack the motivation to consider alternatives.

Cult products such as Apple command fierce consumer loyalty, devotion, and maybe even worship by consumers. A large majority of consumers agree that they are willing to pay more for a brand when they feel a personal connection to the company.

A. Types of Involvement 1. Product Involvement a. Product involvement is a consumer’s level of interest in a particular product.

Product decisions are likely to be highly involved if the consumer believes there is a lot of perceived risk. This means the person believes there may be negative consequences if they choose the wrong option. (Figure 5.5 lists five types of perceived risk.) b. When a consumer is highly involved with a specific product they exhibit brand loyalty: Repeat purchasing behavior that reflects a conscious decision to continue buying the same brand. c. Consumers engage in brand switching, even if our current brand satisfies our needs. Variety-seeking is the desire to choose new alternatives over more familiar ones.

Strategies to Increase Product Involvement: • •

Mass customization describes the personalization of products and services for individual customers at a mass-production price.

DIY (Do It Yourself) refers to doing activities ourselves rather .

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• •

than hiring someone else to do it. Researchers refer to this as the IKEA Effect.

Co-creation strategies go a step further, because the company works jointly with customers to create value.

Gamification refers to the application of gaming principles.

2. Message Involvement a. Alternate reality games (ARGs) are an emerging way to engage consumers. Thousands of people participate in a fictional story or competition to solve a mystery. b. Media vehicles possess qualities that influence our motivation to pay attention to what they tell us – this is known as message involvement. c. Print is a high-involvement medium. Television is a low-involvement medium.

Strategies to Increase Message Involvement: • Use novel stimuli, such as unusual cinematography, sudden silences, or unexpected movements, in commercials.

• Use prominent stimuli, such as loud music and fast action, to capture attention.

• Include celebrity endorsers.

• Provide value that customers appreciate.

• Invent new media platforms to grab attention.

• Encourage viewers to think about actually using the product.

• Create spectacles where the message is itself a form of entertainment.

3. Situational Involvement Situational involvement describes engagement with a store, website, or location where people consume a product or service.

Strategies to Increase Situational Involvement: • Personalization • High tech • Subscription boxes.

Use Chapter Objective 5-1 Here.

Use Key Terms involvement, inertia, product involvement, perceived risk, brand loyalty, varietyseeking, mass customization, DIY (Do It Yourself), KIDEA Effect, co-creation, alternate reality games (ARGs), message involvement, and situational involvement Here.

Use Review Questions 5-6, 5-7, and 5-8 Here.

Use Consumer Behavior Challenges 5-14 and 5-15 Here.

REVIEW .

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5-1.

What is motivation and why is this idea so important to marketers?

Motivation refers to the processes that lead people to behave as they do. It occurs when a need is aroused that the consumer wishes to satisfy. Once a need has been activated, a state of tension exists that drives the consumer to attempt to reduce or eliminate the need.

Marketers try to create products and services that will provide the desired benefits and permit the consumer to reduce this tension. (5 minutes, Chapter Objective 5-1, AACSB: Reflective Thinking)

5-2.

Describe three types of motivational conflicts, citing an example of each from a current marketing campaign.

In an approach–approach conflict, a person must choose between two desirable alternatives. A student might be torn between going home for the holidays and going on a skiing trip with friends. Many of the products and services we desire have negative consequences attached to them as well. We may feel guilty or ostentatious when buying a status-laden product such as a fur coat, or we might feel like a glutton when contemplating a tempting package of Twinkies. An approach–avoidance conflict exists when we desire a goal but wish to avoid it at the same time. Sometimes consumers find themselves “caught between a rock and a hard place.” They may face a choice with two undesirable alternatives, for instance, the option of either throwing more money into an old car or buying a new one. Marketers frequently address an avoidance–avoidance conflict with messages that stress the unforeseen benefits of choosing one option (e.g., by emphasizing special credit plans to ease the pain of car payments). (10 minutes, Chapter Objective 5-3, AACSB: Reflective Thinking,)

5-3.

Explain the difference between a need and a want.

The specific way a need is satisfied depends on the individual’s unique history, learning experiences, and cultural environment. A want is the particular form of consumption used to satisfy a need. For example, two classmates may feel their stomachs rumbling during a lunchtime lecture. If neither person has eaten since the night before, the strength of their respective needs (hunger) would be about the same. However, the ways each person goes about satisfying this need might be quite different. (5-7 minutes, Chapter Objective 5-2, AACSB: Reflective Thinking)

5-4.

What is cognitive dissonance?

Cognitive dissonance is based on the premise that people have a need for order and consistency in their lives and that a state of tension is created when beliefs or behaviors conflict with one another. The conflict that arises when choosing between two alternatives may be resolved through a process of cognitive dissonance reduction, where people are motivated to reduce this inconsistency (or dissonance) and thus eliminate unpleasant tension. (5 minutes, Chapter Objective 5-1, AACSB: Reflective Thinking)

.

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5-5.

Name the levels in Maslow’s hierarchy and give an example of a marketing appeal that is focused at each level.

•

Physiological: ads that promise to provide a cure for hunger or thirst fall in this category • Safety: insurance companies, security companies, and social marketing campaigns often focus on safety • Social: alcohol companies, fragrance companies, and oral hygiene companies often focus on social/belonging (as do dating websites) • Esteem: luxury goods, educational institutions, and athletic footwear/apparel manufacturers often focus on esteem • Self-actualization: spiritual organizations, some charities, and the military focus on self-actualization • Self-transcendence: ads focused on creating clarity around a firm’s brand and the brand’s purpose, specifically, its social purpose such as TOMS shoes.

You can also ask students to come up with their own examples for a single product to extend this exercise (see Application Exercise 1). (25 minutes, Chapter Objective 5-1, AACSB: Reflective Thinking) 5-6.

List three types of perceived risk, and give an example of each.

Perceived risk means that a person believes there may be negative consequences if he or she chooses the wrong option. One type of risk is monetary risk. An example might be buying a lower-priced product that also has a lower quality instead of a more expensive product with a better reputation for quality. Social risk affects self-esteem and selfconfidence. An example of a social risk would be in choosing one brand of headphones or cell phone over another, more popular brand. Psychological risks are based on affiliation and status. One type of psychological risk might be in the purchase of an expensive luxury automobile. (5 minutes, Chapter Objective 5-4, AACSB: Reflective Thinking)

5-7.

What is consumer involvement? How does this concept relate to motivation?

We can define involvement as “a person’s perceived relevance of the object based on their inherent needs, values, and interests.” The word object is used in the generic sense.

It refers to a product (or a brand), an advertisement, or a purchase situation. Consumers can find involvement in all these objects. Involvement increases consumer motivation to process information about the object. (10 minutes, Chapter Objective 5-4, AACSB: Reflective Thinking)

5-8.

What are some strategies marketers can use to increase consumers’ involvement with their products or messages?

• •

Appeal to the consumers’ hedonic needs. For example, ads using sensory appeals generate higher levels of attention.

Use novel stimuli, such as unusual cinematography, sudden silences, or .

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unexpected movements in commercials.

• Use prominent stimuli, such as loud music and fast action, to capture attention in commercials. In print formats, larger ads increase attention. In addition, viewers look longer at colored pictures as opposed to black and white.

• Include celebrity endorsers to generate higher interest in commercials.

• Provide value customers appreciate.

• Let customers make the messages (user-generated content).

• Invent new media platforms to grab consumer attention.

Create spectacles/performances where the message is a form of entertainment. (25 minutes, Chapter Objective 5-4, AACSB: Reflective Thinking) CONSUMER BEHAVIOR CHALLENGE DISCUSS 5-9.

Does money buy happiness? Why or why not?

Happiness is a mental state of well-being characterized by positive emotions. What makes us happy? Although many of us believe owning more shiny material goods is the key to happiness, research says otherwise. Several studies have reported that a greater emphasis on acquiring things actually links to lower levels of happiness. Younger people are more likely to associate happiness with excitement, whereas older people are more likely to associate this state with feelings of calm and peacefulness. (5 minutes, Chapter Objective 5-1, AACSB: Reflective Thinking)

5-10

The chapter discusses the quest by many consumers to quantify their personal actions – exercise, bodily functions, finances, and perhaps even the number of dates they went on

this month. As we continue to “outsource” these measurements to technology and share them with our networks, do you think this can go too far? At what point do we stop being an individual and start to be a set of metrics?

Student responses will vary. Students should include a discussion of the quantified self (QS) movement and self-regulation. (15 minutes, Chapter Objective 5-1, AACSB: Reflective Thinking) 5-11. A group of psychologists argued that we need to revise Maslow’s hierarchy of needs.

They propose we should delete “self-actualization” from the pinnacle and replace it with “parenting.” Right below this peak, they added “mate retention” and “mate acquisition.”

They claim that too many people see Maslow’s triangle as “aspirational” – a description of what fulfilled individuals “should” do – rather than as an explanation of how human motivation actually works. Their perspective is evolutionary; if the only purpose of art, music, and literature is self-fulfillment, how does that contribute to the survival of the species? What do you think – do our motivations to buy, have, and be ultimately come down to the survival of our gene pool? .

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Survival of the gene pool was typically designated to the bottom of the triangle as a physiological need, along with food and water. The positioning at the bottom of the triangle suggests the reproductive process is fundamental or part of the foundation, not something people aspire to do once they have accomplished everything else. That said, studies in biology suggest animals (in general) are less likely to reproduce when food and water resources are scarce. Students may have different opinions about when the desire to reproduce has the potential to drive consumer behavior. (15 minutes, Chapter Objective 5-2, AACSB: Reflective Thinking)

5-12. Our emotional reactions to marketing cues are so powerful that some high-tech companies study mood in small doses (in 1/30 of a second increments) as they analyze people’s facial reactions when they see ads or new products. They measure happiness as they look for differences between, for example, a true smile (which includes a relaxation of the upper eyelid) and a social smile (which occurs only around the mouth). Whirlpool used this technique to test consumers’ emotional reactions to a yet-to-be-launched generation of its Duet washers and dryers. The company’s goal: To design an appliance that will actually make people happy. Researchers discovered that even though test subjects said they weren’t thrilled with some out-of-the-box design options, such as unusual color combinations, their facial expressions said otherwise. Does the ability to study our emotional reactions at such a specific level give marketers an unfair advantage?

Responses to this question will center around what students believe the goals of marketing to be. The idea of creating products that actually elicit happiness is laudable; however, if they believe the goal to be selling a product at all costs, then their viewpoint will be quite different. (10 minutes, Chapter Objective 5-3, AACSB: Reflective Thinking, Ethical Understanding and Reasoning)

APPLY 5-13

Our online behaviors also can satisfy needs at different levels of Maslow’s hierarchy of needs, especially when we participate in social networks such as Facebook. Web-based companies can build loyalty if they keep these needs in mind when they design their offerings: • We satisfy physiological needs when we use the Web to research topics such as nutrition or medical questions.

• The internet enables users to pool information and satisfy safety needs when they call attention to bad practices, flawed products, or even dangerous predators.

• Profile pages on Facebook let users define themselves as individuals.

• Online communities, blogs, and social networks provide recognition and achievement to those who cultivate a reputation for being especially helpful or expert in some subject.

• Users can seek help from others and connect with people who have similar tastes and interests.

• Access to invitation-only communities provides status. .

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• Spiritually based online communities can provide guidance to troubled people.

Interview people you know about their motivations to participate in social media. Ask them to provide a list of the platforms they access most, then for each probe about their reasons to visit these. What needs do these sites appear to satisfy? How might these insights help you to devise ideas for new social media products?

Student responses will vary based on the users interviewed and types of social media used. Responses should recognize how social media fills needs and helps to create an identity for the user. (2 hours, Chapter Objectives 5-1 and 5-2, AACSB: Reflective Thinking) 5-14. Interview members of a celebrity fan club. Describe their level of involvement with the “product,” and devise some marketing strategies to reach this group.

Student responses to this exercise might consider a variety of celebrities—movie stars, musicians, and politicians—living and dead. They might be asked to consider the Elvis Presley fan club phenomenon in terms of the tremendous marketing opportunities that have derived from tours of his home in Memphis (Graceland), his personal property displayed in “museums” (guitars, clothing, music awards, etc.), his “signature” hairstyle and sideburns, other actors’ and musicians’ remakes of his movies and songs, television programs, Elvis parades, books, postage stamps, etc. The quickest way to do this project is to “go online” to a “favorite site.” Most of the recognized search engines (e.g., Yahoo!) will have ways for you to reach the celebrity sites. (Possible Field Project Idea) (30 minutes, Chapter Objective 5-4, AACSB: Reflective Thinking)

5-15. The text notes that marketers continue to push the envelope to create spectacles that will increase consumer involvement with their messages: • A British show broadcast a group of skydivers who performed a dangerous jump to create a human formation in the air that spelled out the letters H, O, N, D, A. • Honda built a musical road in Lancaster, PA; grooves in the cement create a series of pitches that play the William Tell Overture when a car drives over them.

• A New York campaign for Jameson Irish Whiskey projects an ad onto a wall— an operator scans the street for pedestrians who fit the brand’s profile and inserts live text messages directed at them into the display.

• To promote the 25th anniversary of the Michael Jackson album Thriller, which featured zombies dancing in a music video of the title song, Sony BMG staged a performance in the London Underground. A group of “passengers” suddenly burst into a zombie-like dance before they disappeared into the crowd, and this videotaped scene was posted online. The video inspired similar performances in other countries, and within a week more than a million people had downloaded these films. In a similar stunt for T-Mobile, several hundred commuters at the Liverpool rail station broke into a dance; more than 15 million people watched the performance on YouTube in the following weeks.

Can you top these? Imagine that a client hires you to launch a new energy drink. Propose a .

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spectacle you could engineer that would attract potential customers to learn more about your product.

Student responses to this question will vary considerably. They might include popular music, celebrities, or trends including dance moves, and activities. Concepts from the text such as mood, happiness, positive effects, etc. might also be discussed. (30 minutes, Chapter Objective 5-4, AACSB: Reflective Thinking)

CASE STUDY TEACHING NOTES Chapter 5 Case Study: Game On! Using Gamification to Engage with Consumers Summary of Case Marketers have learned that games can be a great way to get and hold consumers’ attention and help them engage with a brand. Gamification marketing uses experience, design, and game mechanics to attract and retain customers. Ads in game form sometimes work better than a traditional ad because we react differently to a game than we do to a traditional ad, largely based on a desire for rewards.

Gamification has been shown to lead to more engagement and increased purchases. The approach is definitely catching on, with the gamification market projected to grow to $32 billion by 2025 and $38.4 billion by 2026.

Suggested Answers for Discussion Questions CS 5-1. Choose a product without an apparent gamification strategy, and design a campaign that uses games to engage with users. Test your creativity by designing something more involved than simply winning badges for buying more of the product.

To spur ideas, suggest students look for ways to create games that use familiar sports as an inspiration for a game.

While games can incorporate rewards for frequency of purchase, that loyalty should provide additional opportunities for gameplay or more advantaged play (like a bonus), rather than just awarding gold stars for buying products.

Brands that have characters may provide students with game ideas that incorporate the character in the game: • •

Progressive Insurance (Flo) B&G Foods (Jolly Green Giant) .

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• P&G (Mr. Clean) • Pillsbury (Poppin’ Fresh aka, Pillsbury Dough Boy) • Energizer (Bunny) • Michelin (Michelin Man) • Geico (Gecko) (10 minutes, Chapter Objective 4, AACSB: Application of Knowledge) CS 5-2. What makes a “good” game? Create a list of dos and don’ts for effective marketing gamification.

Students’ answers will vary. Some possible features (from Chapter Text): • • • • •

Multiple short- and long-term goals Rapid and frequent feedback A reward for most or all efforts in the form of a badge or a virtual product Friendly competition in a low-risk environment A manageable degree of uncertainty

Other possibilities: • Fun • Challenging (but not too hard) • Levels of play • Ability to interact with/play with others • Visually engaging Note that these are all “Do’s:” the opposites of the above lists could be considered “Don’t’s.”

(10 minutes, Chapter Objective 4, AACSB: Application of Knowledge) CS 5-3. Does gamification work with all demographics (age, income, gender, education)?

What game design elements should be considered when marketing to different demographic segments?

Some research has been conducted on this topic, including: Bittner, J.V. and Shipper, J. (2014), "Motivational effects and age differences of gamification in product advertising", Journal of Consumer Marketing, Vol. 31 No. 5, pp.

391-400. https://doi.org/10.1108/JCM-04-2014-0945 Jonna Koivisto, PhD, Aqdas Malik, PhD, Gamification for Older Adults: A Systematic Literature Review, The Gerontologist, Volume 61, Issue 7, October 2021, Pages e360– e372, https://doi.org/10.1093/geront/gnaa047 Koivisto, Jonna & Hamari, Juho. (2014). Demographic differences in perceived benefits from gamification. Computers in Human Behavior. 35. 179–188. https://doi.org/10.1016/j.chb.2014.03.007. .

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Students may assume that only teens and younger adult consumers will be candidates for gamified marketing experiences.

Game design factors for older consumers might include: • Themes that are more familiar to an older demographic, perhaps using appropriate sports figures or celebrities.

• Less technical aspects to the game that might not be familiar to those who do not play video games.

• Word games or other similar games that play on games popular with older adults like crossword puzzles or Sudoku.

Game design factors for children might include: • Use of cartoon characters such as animals • Fast and simple play that considers shorter attention-spans • Achievable goals • Sounds and graphics that reward successful play • Acknowledgment of effort (Good Try! Try again!)

(10 minutes, Chapter Objective 4, AACSB: Reflective Thinking)

MULTIPLE CHOICE QUESTIONS 1. Gamification is particularly useful with which generations? a. Baby Boomers and Children b. Children and Gen Z c. Millennials and Gen Z d. Gen X and Baby Boomers e. Children and Millennials Correct answer: c Games are particularly effective to reach younger Millennial and Gen Z consumers who have grown up with digital technology.

2. The psychology of gamification includes all but which one of the following? a. Consumers can choose to play rather than being “forced” to watch an ad. b. Games give users control. c. We have a tendency to form habits. d. Games satisfy a need for achievement. e. There is no chance of failure with a marketing game.

Correct answer: e Rather than being forced to watch an ad, consumers are able to choose what they want to play for. Players do not see the experience as an ad, but rather as a reward, as a prize. These games give users control and reinforce desirable behavior – such as providing a product review-through rewards. Games can also satisfy one’s need for achievement, even if only in small ways.

The tendency to form habits is also at play; some games offer players rewards to return on a regular basis. .

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3. One study cited in the case found that what percent of study respondents would be more likely to make a purchase from a brand if they had enjoyed playing a game offered by the company? a. 60% b. 99% c. 10% d. 20% e. Most respondents said that games did not affect their purchase behavior.

Correct answer: a A study by digital agency Reflect Digital found that 60 percent of study respondents would be more likely to make a purchase from a brand if they had enjoyed playing a game offered by the company; the number rises to 86 percent for those who have played branded games before.

4. The gamification market is projected to grow to what size by 2026? a. $30 million b. $38 billion c. $1 trillion d. $2 billion e. $10 million Correct answer: b The gamification market is projected to grow to $32 billion by 2025 and $38.4 billion by 2026.

5. A major goal of marketing gamification is a. variety b. engagement c. awareness d. fun e. stimulation Correct answer: b Marketers have learned that games can be a great way to get and hold consumers’ attention and help them engage with a brand.

Additional Support Material STUDENT PROJECTS Individual Projects 1.

Ask students if they have provided opinions regarding products or brands on any website.

If yes, have them share it with the class. If not, let them visit a site to provide opinions .

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about their most recent significant purchase. They can also go to www.epinions.com and provide their input.

Students may have gone to an individual retailer’s website or a website that collects consumer opinions. This is related to the idea of involvement because consumers are more likely to provide opinions about a product if they have a high level of involvement.

(15 minutes, Chapter Objective 5-4, AACSB: Reflective Thinking) 2.

Have students think of examples of products or services that each of them has purchased that fit the three types of motivational conflicts found in Figure 4.1.

Approach-approach conflict—a person must choose between two desirable alternatives example: choosing between two favorite brands of automobiles.

Approach-avoidance conflict—many products or services we desire have negative consequences attached to them; example: wanting Twinkies but feeling like a glutton.

Avoidance-avoidance conflict—a choice between two undesirable alternatives; example: spend more to repair an older car or buy a newer more expensive car. (15 minutes, Chapter Objective 5-3, AACSB: Reflective Thinking)

3.

Find a student who is not too shy to do this one. Ask the student to search for unconscious motives by asking six people if they are wearing perfume or cologne. Make sure they keep asking until at least three people say, “Yes.” Then have them ask the respondents, “Why do you wear cologne?” Ask three of those who said they were not wearing cologne, “Why not?” Ask the three who said, “No” if they wore any the last time they had a date. Share their responses with the class and evaluate them. Can the class uncover any hidden motivations?

Look for students to understand what motivation is. Some people may be forthcoming about the needs that they are trying to satisfy by using cologne, which may or may not be related to dating. Students may make inferences about hidden motivations that are not correct. (45 minutes, Chapter Objective 5-1, AACSB: Analytical Thinking)

4.

Ask students to come up with a list of products or services that people primarily buy because they want to “belong.” Have them explain why they listed the particular items.

Then, have them explain how individuals in solitude might also consume each of the items that they listed. Are there viable needs that consumers have for consuming these products both in the company of others as well as by themselves?

Social needs or a need to belong is often used as part of the marketing appeal for beverages (e.g., alcoholic beverages), fragrances, oral hygiene products, and entertainment products, among others. Traditional students may think of the marketing associated with student organizations, including sororities/fraternities. For the second part of the question, the students’ responses will depend on the product selected and the cultural norms associated with the consumption of the product. (20 minutes, Chapter Objective 5-2, AACSB: Reflective Thinking)

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5.

Have each student extensively describe a consumption situation that reflects each of the following: need for affiliation, need for power, and need for uniqueness.

Consumption situations that reflect a need for affiliation usually put the consumer in the company of other people and make him/her feel like part of something.

Bars/clubs/sporting events may be among the examples. Consumption situations that reflect a need for power usually put the consumer in control and give the consumer an opportunity to develop mastery over his/her surroundings. Automotive products (e.g. tires, engine additives, vehicles) and technology products often appeal to the need for power. Consumption situations that reflect a need for uniqueness include products that bring out the individual’s distinctive qualities and/or make the individual feel special.

Apparel often falls into this category, particularly when the consumer is shopping for a special event. (20 minutes, Chapter Objective 5-2, AACSB: Reflective Thinking)

6.

Have students find advertisements that attempt to persuade consumers to think of products as objects that satisfy one of the motives described in this chapter. Have them identify and classify that motive.

Students may think broadly of hedonic or utilitarian motives. Hedonic motives are driven by a desire to experience excitement or fantasy. Utilitarian motives are driven by a rational or functional need. They may also speak about motives that are aroused by biogenic (food, water, air, shelter) or psychogenic needs (status, power, affiliation), or by the need for affiliation/power/uniqueness. Look for students to reflect on their understanding of the category of underlying needs they select. (30 minutes, Chapter Objective 5-2, AACSB: Reflective Thinking)

7.

Ask students to find a print ad that appeals to each level of Maslow’s hierarchy. In class, have different students show their ads and explain why their ads appeal to each level. Ask why they think the firm selected this particular appeal. Is there an overlap between levels? Is this good or bad?

Student examples should include an ad that appeals to physiological, safety, social, esteem, and self-actualization needs. Student explanations should reflect their understanding of each of these levels in the hierarchy. Student opinions about the overlap between levels and whether it is good or bad are likely to vary. Encourage students to think about whether it is good or bad in light of what they read regarding criticisms of Maslow’s hierarchy in the chapter. (20 minutes, Chapter Objective 5-2, AACSB: Reflective Thinking)

8.

Have students think of some product or service they have purchased recently. Then have them respond to the elements of consumer involvement in Figure 5-4. Is their involvement with this product best described as product involvement, message-response involvement, or purchase situation involvement? Why?

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Student responses will vary depending on the purchase made but look for students to reflect on their understanding of the type of involvement they use to describe the situation by explaining why the type of involvement they selected is the most descriptive of their purchase situation. Some students may feel high levels of more than one kind of involvement characterized by the purchase. If so, encourage students to explain why that is the case, which should help reinforce the differences between the different types of involvement. (20 minutes, Chapter Objective 5-4, AACSB: Reflective Thinking) Group Projects 1.

Assign groups of students to observe a table of people eating in either a restaurant or cafeteria setting. See if they can identify any of the major motives at work. Have them report on their conclusions. (Hint: Watch the respondents’ behavior while they eat and during their conversation. Perhaps students might like to videotape part of the meal—five minutes maximum).

Most students will be able to distinguish between people who are there for the entertainment or enjoyment of the experience (hedonic motives) from those who are simply there to satisfy their hunger (utilitarian motives). Students may also use Maslow’s hierarchy to classify motives. Some students may find this fun, particularly if they like to people watch and make up stories about who the people are and what they are doing.

Other students may not feel comfortable watching others. If not, you may want to provide an alternative assignment. Students may have the ability to videotape on their phones.

(90 minutes, Chapter Objective 5-2, AACSB: Analytical Thinking)

2.

Have groups of students come up with three examples of a truly mass-customized product. For each, have them give extensive reasons as to why consumers might choose the mass-customized version of a product over the “off-the-rack” version.

Student examples may include M&M’s (www.mymms.com is mentioned in the text), Dell computers, make-up/perfume companies, blue jeans companies, NikeID and Chuck Taylor Converse sneakers, credit card companies that allow you to put a photo you select on your credit card, etc. Reasons why consumers might choose a mass-customized version of the product may be a function of the way they will use the product (a product that is designed for them is more likely to meet the consumers’ needs/wants) and may relate to the need for uniqueness. (20 minutes, Chapter Objective 5-4, AACSB: Reflective Thinking)

3.

Have the class keep a diary of their consumer decisions for a two-day period. (Make sure they include both actual purchases and conscious decisions not to buy.) At the end of the period, have them review their diaries and classify their apparent motives. (Maslow’s scheme may be useful here.) During this process, were they more aware of ads? Have students discuss their diaries in groups.

If you guide students toward Maslow’s hierarchy of needs, you should look for their responses to be characterized based on physiological, safety, social, esteem, and self.

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actualization needs. Since this is a suggested group project, it may be enlightening to ask students to compare their motives for the same product category. The last question, regarding awareness of ads, can be related to the content in Chapter 2 on perceptual vigilance. (90 minutes, Chapter Objective 5-2, AACSB: Reflective Thinking,) 4.

Have the class go to a shopping center or mall and observe others’ behavior. What conclusions can they make about motives and involvement after having made the observation?

This group assignment is similar to the first group assignment but takes place in a different context. It may be easier to observe multiple shoppers in a mall than in a restaurant. You can direct students to characterize shoppers based on their demographics to see if there is any pattern, what the students perceive motivates different shoppers in this context. (90 minutes, Chapter Objectives 5-2 and 5-4, AACSB: Reflective Thinking)

5.

In a project related to #4, have groups of students visit a shopping mall or a superstore.

Have them evaluate the retail environment for ways that both the retailer and product manufacturers try to increase consumer involvement (refer to the text if necessary for strategies to increase involvement).

Students may observe shoppers who seem highly involved in a product category or purchase situation. They should recognize sales promotions and customized communication strategies are designed to increase consumer involvement. They may also observe strategies used to increase involvement in the in-store messages (e.g. end-cap displays, shelf-talkers, digital signage). (60 minutes, Chapter Objective 5-4, AACSB: Reflective Thinking)

ONLINE ASSIGNMENTS Individual Assignments 1.

Go to www.burton.com. Burton Snowboards are very popular with Gen Y. How does this website attempt to motivate consumers to try the sport and the Burton products? Be specific with the description of strategies that Burton uses. Do you think the Burton approach is effective? Explain. This project can also be done with Nike.com.

The website uses video to show people trying the sport, collects information to learn about consumer needs and provide advice to make the sport less intimidating to newcomers, offers a community of users, and provides access to people who want to learn how to snowboard. Student opinions on whether the Burton approach is effective may vary. (15 minutes, Chapter Objectives 5-1 and 5-4, AACSB: Reflective Thinking)

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2.

Go to http://www.vans.com. Find the link for creating your own custom pair of Vans shoes. Go through the process and print an example of your shoes to take into class and share. Describe the experience. Did the experience contribute to the level of involvement in shopping for such a product?

Vans Customs offers consumers the opportunity to choose from four different types of sneakers. After the consumer selects a size and gender, the site offers consumers the ability to customize the design (with templates where the consumer can start). The site provides an example of mass customization (personalization of products and services for individual customers at a mass-production price), which is noted to increase product involvement in the chapter. (20 minutes, Chapter Objective 5-4, AACSB: Reflective Thinking)

3.

Go to www.specialized.com. Specialized Bicycles is one of the leading manufacturers and marketers of all types of bikes. Browse their website. Give a brief description of their different product lines. How does Specialized motivate consumers to get into biking?

What might Specialized do to improve the “motivation” aspect of their site (you might want to compare it to the Burton Snowboard site discussed previously)?

Specialized offers mountain bikes, road bikes, multi-use bikes, dirt/park/street bikes, bikes for kids, and equipment for bikes. Specialized shows images of people enjoying their products and provides information about champions. The site also provides an opportunity for consumers to engage in a community and interactive tools to help decision-making. Specialized may offer a call to action or provide access to training events for beginners. (20 minutes, Chapter Objectives 5-1 and 5-2, AACSB: Reflective Thinking)

Group Assignments 1.

Visit a motivation website such as www.GetMotivation.com or www.Motivation123.com. Many of these sites target personal motivation, but are there techniques that marketers can learn in order to motivate consumers to buy a product/service or buy into a type of lifestyle? Write a report and present it.

Students should identify specific techniques related to the content of the website they select. The students may have different ideas about how the content on the websites relates to the suggested content. Look for students to provide support for their opinions.

(45 minutes, Chapter Objective 5-1, AACSB: Reflective Thinking)

2.

Go to www.burningman.com. Become familiar with the purpose of this festival. As a group, discuss the extent to which it is possible to achieve the purposes set forth by this organization. Discuss the irony of this.

Burning Man is a festival dedicated to self-reliance, self-expression, art, and community.

The ten principles are found here: http://www.burningman.com/whatisburningman/about_burningman/principles.html. The .

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festival touts individual expression/self-reliance at the same time as it espouses the value of the community. (30 minutes, Chapter Objective 5-2, AACSB: Reflective Thinking)

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Chapter 6: Attitudes and How to Change Them

Chapter 6: ATTITUDES AND HOW TO CHANGE THEM

CHAPTER OBJECTIVES When students finish this chapter, students should be able to: 6- 1.

6- 2.

6- 3.

6- 4.

Explain the functions and components of attitudes in consumer behavior.

Describe the ways in which we form attitudes.

Explain how persuasion is an active attempt to create or change attitudes.

Discuss the ways in which the source, the message, and the medium are used to craft persuasion strategies.

CHAPTER SUMMARY Explain the functions and components of attitudes in consumer behavior.

An attitude is a predisposition to evaluate an object or product positively or negatively. We form attitudes toward products and services, and these attitudes often determine whether we will purchase or not. A key to attitude formation is the function the attitude holds for the consumer (e.g., is it utilitarian or ego defensive?).

Describe the ways in which we form attitudes.

One organizing principle of attitude formation is the importance of consistency among attitudinal components—that is, we alter some parts of an attitude to be in line with others. Such theoretical approaches to attitudes as cognitive dissonance theory, self-perception theory, and balance theory stress the vital role of our need for consistency.

Multiattribute attitude models underscore the complexity of attitudes: They specify that we identify and combine a set of beliefs and evaluations to predict an overall attitude. Researchers integrate factors such as subjective norms and the specificity of attitude scales into attitude measures to improve predictability.

Explain how persuasion is an active attempt to create or change attitudes.

The traditional view of communications regards the perceiver as a passive element in the process. New developments in interactive communications highlight the need to consider the active roles a consumer plays when they obtain product information and build a relationship with a company. Advocates of permission marketing argue that it’s more effective to send messages to consumers who have already indicated an interest in learning about a product than trying to hit people “cold” with these solicitations.

Discuss the ways in which the source, the message, and the medium are used to craft persuasion strategies. .

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The communications model specifies the elements marketers need to transmit meaning. These include a source, a message, a medium, a receiver, and feedback. Two important characteristics that determine the effectiveness of a source are its attractiveness and credibility.

Some elements of a message that help to determine its effectiveness include the following: communication of the message in words or pictures; employment of an emotional or a rational appeal; frequency of repetition; conclusion drawing; presentation of both sides of the argument; and inclusion of fear, humor, or sexual references. Advertising messages often incorporate elements from art or literature, such as dramas, lectures, metaphors, allegories, and resonance.

Reality engineering occurs when marketers appropriate elements of popular culture to use in their promotional strategies.

The relative influence of the source versus the message depends on the receiver’s level of involvement with the communication. The elaboration likelihood model (ELM) specifies that source effects are more likely to sway a less involved consumer, whereas a more involved consumer will be more likely to attend to and process components of the actual message.

CHAPTER OUTLINE I.

The Power of Attitudes

People use the term attitude in many ways. For our purposes, an attitude is a lasting, general evaluation of people (including oneself), objects, advertisements, or issues.

We call anything toward which one has an attitude an attitude object (Ao).

Consumers have attitudes toward a wide range of attitude objects, from productspecific behaviors (e.g., you use Crest toothpaste rather than Colgate) to more general, consumption-related behaviors (e.g., how often you should brush your teeth).

A. Attitudes (Generally) Guide Our Behavior

Psychologist Daniel Katz developed the functional theory of attitudes to explain how attitudes facilitate social behavior. According to this approach, attitudes exist because they serve some function for the person.

There are different functions of attitudes: • Utilitarian function—The utilitarian function relates to the basic principles of reward and punishment.

• Value-expressive function—Attitudes that perform a value-expressive function relate to the consumer’s self-concept or central values. A person forms a product attitude in this case because of what the product says about him or her as a person.

• Ego-defensive function—Attitudes we form to protect ourselves either from external threats or internal feelings perform an ego-defensive function.

• Knowledge function—We form some attitudes because we need order, structure, or meaning. A knowledge function applies when a person is in an ambiguous situation or when he or she confronts a new product.

B. Attitudes, Fast and Slow: Cognitive and Affective Components .

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Two distinct ways of deciding are slow thinking and fast thinking. The distinction between these two systems is common in psychology: “Type I” processes are fast, autonomous, and intuitive, while “Type 2" processes are slow, deliberative, and analytic.

C. “I Know It”: Cognitive Focus Cognitive models of attitudes focus primarily on the beliefs (accurate or not) we hold about a product.

Because attitudes are so complex, marketing researchers may use multiattribute attitude models to understand them. This type of model assumes that consumers’ attitude toward an attitude object (Ao) depends on the beliefs they have about several of its attributes.

Basic multiattribute models contain three specific elements: • Attributes are characteristics of the Ao. A researcher tries to identify the attributes that most consumers use when they evaluate the Ao. • Beliefs are cognitions about the specific Ao (usually relative to others like it). A belief measure assesses the extent to which the consumer perceives that a brand possesses a particular attribute.

• Importance weights reflect the relative priority of an attribute to the consumer. Although people might consider an Ao on a number of attributes, some attributes are likely to be more important than others (i.e., consumers will give them greater weight). Furthermore, these weights are likely to differ across consumers.

The most influential multiattribute model is called the Fishbein model, named after its primary developer. The model measures three components of attitude: • Salient beliefs people have about an Ao (i.e., those beliefs about the object a person considers during evaluation).

• Object-attribute linkages, or the probability that a particular object has an important attribute.

• Evaluation of each of the important attributes.

When we combine these three elements, we compute a consumer’s overall attitude toward an object.

1. Marketing Applications of the Multiattribute Models • Capitalize on relative advantage • Strengthen perceived product/attribute linkages • Add a new attribute • Influence competitors’ ratings D. “I Feel It”: Affective Focus Moods involve temporary positive or negative affective states that are not necessarily linked to a particular event.

Emotions such as happiness, anger, and fear tend to be more intense; they often relate to a specific triggering event.

1. Moods Shape Our Judgments Mood congruency refers to the idea that our moods tend to shape our judgements; consumers evaluate the same product more positively when they are .

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in a positive versus a negative mood.

Helping others to resolve their own negative moods is known as negative state relief. A trend in advertising is toward inspirational stories that manipulate our emotions like a roller-coaster. This is referred to as sadvertising.

2. Emotions Rule Our Brains: Neuromarketing The emerging field of neuromarketing uses functional magnetic resonance imaging (or MRI), a brain-scanning device that tracks blood flow as we perform mental tasks, to take an up-close look at how our brains respond to marketing messages and product design features.

E. Oops! Attitudes Aren’t as Simple as We Thought Complicated concepts like attitudes don’t always fit into the neat little boxes we would like them to.

We find some “messy” factors to keep in mind: • Ambivalence: Generally, attitudes have a valence: They range from strongly negative to strongly positive. But there are many products, brands, and services toward which we hold both positive and negative views. When this happens, we experience attitudinal ambivalence: a sense of being torn or mixed about an attitude object, because both positive and negative components of our attitudes are simultaneously accessible.

• Explicit and implicit elements: Explicit attitudes are those that consumers are conscious of. But we also hold more difficult-to-detect implicit attitudes, those that occur outside of our awareness but still have a big impact on what we think, say, or do. This may be due to a social desirability bias – a conscious effort to report only attitudes that are deemed socially acceptable while keeping your “real” feelings buried.

• Social pressure: There may be social pressure to conform to what others say or do. We are often acutely aware of normative influences – what we believe other people think we should do.

Medication adherence describes the extent to which people fill and take prescribed medicines.

F. An Improved Fishbein Model to the Rescue: The Theory of Reasoned Action Researchers tinkered with the Fishbein model to improve its predictive ability. They call the newer version the theory of reasoned action.

A new element, the subjective norm (SN), takes into account the effects of what we believe other people think we should do. Two factors are used to measure SN: (1) the intensity of a normative belief (NB) that others believe we should take or not take some action and (2) the motivation to comply (MC) with that belief (i.e., the degree to which the consumer takes others’ anticipated reactions into account when evaluating a purchase).

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Chapter 6: Attitudes and How to Change Them

Use Chapter Objective 6-1 Here Use Key Terms attitude, attitude object, functional theory of attitudes, utilitarian function, value-expressive function, ego-defensive function, knowledge function, slow thinking, fast thinking, Fishbein model, moods, emotions, mood congruency, negative state relief, sadvertising, neuromarketing, valence, ambivalence, explicit attitudes, implicit attitudes, social desirability bias, social pressure, normative influences, theory of reasoned action, subjective norm (SN) and medication adherence Here Use Review Questions 6-1, 6-4, 6-6, 6-8, and 6-15 Here Use Consumer Behavior Challenges 6-23, 6-32, 6-34, and 6-39 Here

II.

How Do We Form Attitudes

To understand how committed someone is to their attitude, it’s useful to think about how those attitudes formed in the first place. a. Commitment

Consumers vary in their commitment to an attitude; the degree of commitment relates to their level of involvement with the attitude object.

Three (increasing) levels of commitment are: 1. Compliance—At the lowest level of involvement, compliance, we form an attitude because it helps us to gain rewards or avoid punishment. This attitude is superficial.

2. Identification—Identification occurs when we form an attitude to conform to another person’s or group’s expectations.

3. Internalization—At a high level of involvement we call internalization, deep-seated attitudes become part of our value system. b. The Consistency Principle According to the principle of cognitive consistency, we value harmony among our thoughts, feelings, and behaviors, and a need to maintain uniformity among these elements motivates us. This desire means that, if necessary, we change our thoughts, feelings, or behaviors to make them consistent with other experiences.

The consistency principle is an important reminder that we don’t form our attitudes in a vacuum. c. Balance Theory Balance theory considers how people perceive relations among different attitude objects, and how they alter their attitudes so that these remain consistent (or “balanced”).

A balance theory perspective involves relations (always from the perceiver’s subjective point of view) among three elements, so we call the resulting attitude structures triads. Each triad contains (1) a person and his or her perceptions of (2) an attitude object and (3) some other person or object.

We link elements together in one of two ways: They can have either a unit relation, where we think that a person is somehow connected to an attitude object .

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(something like a belief), or they can have a sentiment relation, where a person expresses liking or disliking for an attitude object.

Balance theory helps us to understand how an attitude toward a person or celebrity can transfer to a brand that they are associated with.

Basking in reflected glory refers to when consumers publicize their connections with successful people or organizations (no matter how shaky the connection) to enhance their own standing.

Use Chapter Objective 6-2 Here Use Key Terms compliance, identification, internalization, principle of cognitive consistency, balance theory and basking in reflected glory Here Use Review Questions 6-2, 6-3, 6-5, 6-7, 6-9 and 6-10 Here Use Consumer Behavior Challenges 6-35 and 6-45 Here

III.

Persuasion: How Do Marketers Change Attitudes?

Persuasion is an active attempt to change attitudes. This is of course job number one for many marketing communicators. a. Sell the Steak or the Sizzle?: The Elaboration Likelihood Model The elaboration likelihood model (ELM) assumes that, under conditions of high involvement, we take the central route to persuasion. Under conditions of low involvement, we take a peripheral route instead. (Figure 6.3) i. Fast Persuasion: The Peripheral Route The peripheral route is the well-traveled route – when we are not really motivated to think in depth about the marketer’s arguments. This route to persuasion highlights the paradox of low involvement: When we don’t care as much about a product, the way it’s presented increases in importance. ii. Slow Persuasion: The Central Route

If people generate counterarguments in response to a message, it’s less likely that they will yield to the message, whereas if they generate further supporting arguments, it’s more likely they’ll comply. According to the ELM, when we find information in a persuasive message relevant or interesting, we pay careful attention to it. In this event, we focus on the arguments the marketer presents and generate cognitive responses to this content. iii. Narrative Persuasion The term narrative transportation describes the extent to which someone feels immersed in a story and is thus “transported” into the action. This is a very powerful way to convey a message. Narrativity is the extent to which a message tells a story.

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b. Persuasion Knowledge: Talking Back to Marketers The premise of the persuasion knowledge model is that consumers develop knowledge about persuasion attempts and then call upon this experience whenever they believe someone is trying to change their mind.

1.Media Literacy A large body of research has shown that when consumers access their persuasion knowledge, they evaluate the source of the persuasion attempt less favorably and they are less likely to get persuaded.

2.Disclosures and Warnings: Do They Work?

Consumers use persuasion knowledge differently. Instead of skepticism and rejection of the message, they may simply search for a more credible source.

Whereas conventional wisdom is that persuasion knowledge is always a bad thing, new research shows that boosting consumers’ persuasion knowledge helps the marketer by making consumers evaluate the marketer more positively.

Use Chapter Objective 6-3 Here Use Key Terms persuasion, elaboration likelihood model (ELM), peripheral route, paradox of low involvement, counterarguments, narrative transportation, narrativity, persuasion knowledge model Here Use Review Questions 6-11, 6-20, and 6-21 Here Use Consumer Behavior Challenges 6-24, 6-38, and 6-40 Here

IV. Crafting Persuasive Communication Strategies The communications model (Figure 6.4) model specifies the elements marketers need to control to communicate with customers: • Source: Where the communication originates.

• Message: There are many ways to say something, and the structure of the message has a significant effect on how we perceive it.

• We transmit the message via a medium.

• Receivers interpret the message.

• The source receives feedback so that the marketer can use receivers’ reactions to modify aspects of the message as necessary.

• In today’s dynamic world of interactivity, there are also many elements of consumer-to-consumer exchanges around the source, the message, and the medium.

A. Decisions, Decisions Tactical Communicational Options

Social scientists developed the traditional model of communications to understand situations in which a source transmits information to many receivers at one time – typically via a broadcast medium. This perspective essentially views advertising as .

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the process of transferring information to the buyer before a sale and regards the message as perishable. That model doesn’t work as well now that we can narrowcast, or finely tune our messages to suit small groups of receivers.

Permission marketing acknowledges that a marketer will be more successful when they communicate with consumers who have already agreed to listen to them (opt-in).

1. The Source Under most conditions, the source of a message can have a big impact on the likelihood that receivers will accept it. Credibility and attractiveness are two particularly important source characteristics. a. Source Credibility Source credibility refers to a communicator’s expertise, objectivity, or trustworthiness. This relates to consumers’ beliefs that this person is competent and that they will provide the necessary information we need when we evaluate competing products. A credible source is particularly persuasive when the consumer has yet to learn much about a product or form an opinion of it.

Source credibility suffers if consumers perceive that the source is biased. Knowledge bias implies that a source’s knowledge about a topic is not accurate. Reporting bias occurs when a source has the required knowledge but we question their willingness to convey it accurately.

Fake news (hoaxes spread by hackers or other outsiders) may reduce source credibility.

A sleeper effect is said to occur when people, over time, “forget” the negativity associated with a particular information source and change their attitudes to align with that advocated by the source. b. Source Attractiveness: “What is Beautiful is Good” Source attractiveness refers to the social value recipients attribute to a communicator. This value relates to the person’s physical appearance, personality, social status, or similarity to the receiver (we like to listen to people who are like us). c. Is Beauty Only Skin Deep?

We assume that good-looking people are smarter, hipper, and happier than the rest of us. This is an example of a halo effect, which occurs when we assume that persons who rank high on one dimension excel on others as well. d. Star Power: Celebrities as Communications Sources In general, celebrity endorsers are more effective when they are male, actors, and endorsers who are congruent with the product. They are also more effective when the endorsement itself is implicit (rather than explicit) and it is about a new product. e. From Talking Head to Partner: The Celebrity Collab Companies are creating collaborations with celebrities – so-called collabs – that link to the endorser’s image or passion in a meaningful 6-8

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Chapter 6: Attitudes and How to Change Them

way. f. Nonhuman Endorsers A celebrity endorsement strategy has its drawbacks. Because of this, marketers seek alternative sources, including cartoon characters and mascots.

Spokescharacters boost viewers’ recall of claims that ads make and yield higher brand attitudes. g. The Most Convincing Sources? Other Consumers Through word of mouth, reviews, and social media, consumers’ voices can be loud and often prevail over more traditional sources.

C. The Message

Characteristics of the message itself help determine its impact on attitudes. These variables include how we say the message as well as what we say.

1. Should We Use Pictures or Words?

The saying “One picture is worth a thousand words” captures the idea that visuals are effective, especially when the communicator wants to influence receivers’ emotional responses.

However, a picture is not always as effective when it communicates factual information. Verbal elements are more effective when an accompanying picture reinforces them, especially if they frame the illustration. Visual images, in contrast, allow the receiver to chunk information at the time of encoding.

2. Types of Message Appeals There are major types of message appeals available to communicators (Table 6.2).

3. Comparative Appeals Comparative advertising refers to a message that compares two or more recognizable brands and weighs them in terms of one or more specific attributes.

Although some comparative ads result in desired attitude changes, they may also be lower in believability and stir up source derogation (i.e., the consumer may doubt the credibility of a biased presentation).

4. How Do We Structure the Argument? a. Two-Sided Appeals Most messages merely present one or more positive attributes about the product or reasons to buy it. These are supportive arguments. An alternative is to use a two-sided message, in which the message presents both positive and negative information.

Under the right circumstances, refutational arguments that first raise a negative issue and then dismiss it can be quite effective.

This approach increases source credibility because it reduces reporting bias. b. Sex Appeals Echoing the widely held belief that “sex sells,” many marketing communications for products from perfumes to autos feature heavy doses of erotic suggestions that range from subtle hints to blatant .

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displays of skin. (Sex appeals) c. Humor Appeals Do humor appeals work? Overall, funny advertisements do get attention. However, the verdict is mixed as to whether humor affects recall or product attitudes in a significant way. A funny ad does inhibit counterarguing (in which a consumer thinks of reasons why he or she doesn’t agree with the message). d. Fear Appeals Fear appeals emphasize the negative consequences that can occur unless the consumer changes a behavior or an attitude. e. Appeals That Use Narrative Devices Many ads take the form of an allegory, which is a story about an abstract trait or concept that advertisers tell in the context of a person, animal, vegetable, or object.

A metaphor places two dissimilar objects into a close relationship such that “A is B,” whereas a simile compares two objects, “A is like B.” A and B, however dissimilar, share some quality that the metaphor highlights.

Resonance is another type of literary device advertisers frequently use. It is a form of presentation that combines a play on words with a relevant picture.

5. Should We Repeat the Message?

People tend to like things that are more familiar to them, even if they were not that keen on them initially. Psychologists call this the mere exposure phenomenon.

When ads are transporting – for instance, with mental imagery (people are prompted to use their imagination while the process an ad) – then more claims beyond three about a product lead people to like the product more.

The two-factor theory explains the fine line between familiarity and boredom; it proposes that two separate psychological processes operate when we repeatedly show an ad to a viewer. The positive side of repetition is that it increases familiarity and thus reduces uncertainty about the product. The negative side is that over time boredom increases with each exposure.

D. The Medium In traditional advertising, the message is placed before or after content on a

given medium. But most people tune out advertising of this sort.

1. Advertainment Messages are less likely to trigger counterarguments if they are linked to a narrative.

This insight has led to a whole new world of advertainment: the fusion of advertising and entertainment. a. Native Advertising Native advertising refers to digital messages designed to blend into the editorial content of the publication in which they appear. b. Product Placement Product placement is the insertion of real products in fictional .

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movies, TV shows, books, and plays. c. Advergaming The future is bright for advergaming, where online games merge with interactive advertisements that let companies target specific types of consumers. d. Reality Engineering Reality engineering occurs when marketers appropriate elements of popular culture and use them as promotional vehicles.

Use Chapter Objective 6-4 Here Use Key Terms communications model, permission marketing, source credibility, knowledge bias, reporting bias, fake news, sleeper effect, source attractiveness, halo effect, collabs, Spokescharacters, message appeals, comparative advertising, source derogation, supportive arguments, refutational arguments, sex appeals, humor appeals, allegory, simile, resonance, mere exposure phenomenon, mental imagery, two-factor theory, advertainment, native advertising, product placement, advergaming, and reality engineering Here Use Review Questions 6-12, 6-13, 6-14, 6-16, 6-17, 6-18, 6-19, and 6-22 Here Use Consumer Behavior Challenges 6-25, 6-26, 6-27, 6-28, 6-29, 6-30, 6-31, 6-33, 6-36, 6-37, 6-41, 6-42, and 6-44 Here

End-of-Chapter Support Material

REVIEW 6-1.

How can an attitude play an ego-defensive function?

Attitudes we form to protect ourselves either from external threats or internal feelings perform an ego-defensive function. An early marketing study indicated that housewives in the 1950s resisted the use of instant coffee because it threatened their conception of themselves as capable homemakers. (5 minutes, Chapter Objective 6-1, AACSB: Reflective Thinking)

6-2.

How do levels of commitment to an attitude influence the likelihood it will become part of the way we think about a product in the long term?

Consumers vary in their commitment to an attitude; the degree of commitment is related to their level of involvement with the attitude object. Consumers are more likely to consider brands that engender strong positive attitudes. (10 minutes, Chapter Objective 6-2, AACSB: Reflective Thinking) .

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6-3.

We sometimes enhance our attitude toward a product after we buy it. How does the theory of cognitive dissonance explain this change?

The theory of cognitive dissonance states that when a person is confronted with inconsistencies among attitudes or behaviors, they will take some action to resolve this “dissonance,” perhaps by changing an attitude or modifying a behavior. The theory has important ramifications for attitudes because people are often confronted with situations in which there is some conflict between their attitudes and behaviors. Thus, if a person encounters negative information about a product after purchasing it, they may discount that information and focus on positive information that would reaffirm their reasons for having purchased. (15 minutes, Chapter Objective 6-2, AACSB: Reflective Thinking) 6-4.

What is mood congruency and how do advertisers use it?

Mood congruency refers to the idea that our moods tend to shape our judgments; consumers evaluate the same products more positively when they are in a positive versus a negative mood.

This is why advertisers attempt to place their ads after humorous TV programming or create uplifting messages that put viewers in a good mood.

(10 minutes, Chapter Objective 6- 1, AACSB: Reflective Thinking)

6-5.

According to balance theory, how can we tell if a triad is balanced or unbalanced? How can consumers restore balance to an unbalanced triad?

Components of a triad can be either positive or negative. More importantly, people alter these components in order to make relations among them consistent. The theory specifies that people desire relations among elements in a triad to be harmonious or balanced. If they are not, a state of tension will result until somehow the person changes his perceptions and restores balance. (10 minutes, Chapter Objective 6-2, AACSB: Reflective Thinking) 6-6.

Describe a multiattribute attitude model and list its key components.

A multiattribute model assumes that a consumer’s attitude (evaluation) toward an attitude object (Ao) depends upon the beliefs they have about several or many attributes of the object and the importance of those attributes. The use of a multi-attribute model implies that identifying these specific beliefs and combining them to derive a measure of the consumer’s overall attitude can predict an attitude toward a product or brand. (5 minutes, Chapter Objective 6-1, AACSB: Reflective Thinking) 6-7.

“Do as I say, not as I do.” How does this statement relate to attitude models?

Many studies have obtained a very low correlation between a person’s reported attitude toward something and their actual behavior toward it. Some researchers have been so discouraged that they have questioned whether attitudes are of any use at all in understanding behavior. (5 minutes, Chapter Objective 6-2, AACSB: Reflective Thinking) .

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6-8.

What is a subjective norm, and how does it influence our attitudes?

The value of SN is arrived at by including two factors: (1) the intensity of a normative belief (NB) that others believe an action should be taken or not taken, and (2) the motivation to comply (MC) with that belief (i.e., the degree to which the consumer takes others’ anticipated reactions into account when evaluating a course of action or a purchase). It influences attitudes because consumers are likely to be more comfortable with attitudes that are consistent with subjective norms. (10 minutes, Chapter Objective 6-1 AACSB: Reflective Thinking) 6-9.

What are some obstacles to predicting behavior even if we know a person’s attitudes?

Some outcomes are beyond the consumer’s control; behavior is not always intentional (impulsive actions; situation changes, novelty seeking); the measures of attitudes may not be specific enough to behavioral intentions; the time frame when the attitude was measured may have been too far removed from the behavior; personal experience may be more powerful than attitudes formed from advertising; and cultural roadblocks (e.g. involuntary acts, the impact of subjective norms, non-linear perspectives on time, fatalistic cultures) may interfere. (105 minutes, Chapter Objective 6-2, AACSB: Reflective Thinking) 6-10.

Describe the theory of reasoned action. How does it improve our ability to predict behavior from attitudes?

The theory of reasoned action has primarily been applied in Western settings. Certain assumptions inherent in the model may not necessarily apply to consumers from other cultures. Several cultural roadblocks diminish the universality of the theory of reasoned action: • Some acts are not voluntary, and the model predicts the performance of a voluntary act.

• The relative impact of subjective norms may vary across cultures.

• The model presupposes consumers are thinking ahead, while not all cultures subscribe to the linear perspective on time.

• Some (more fatalistic) cultures do not believe the consumer controls his/her actions.

(20 minutes, Chapter Objective 6-2, AACSB: Reflective Thinking and Diverse and Multicultural Work Environments) 6-11.

List three psychological principles related to persuasion.

The psychological principles include reciprocity, scarcity, authority, consistency, liking, and consensus. (3 minutes, Chapter Objective 6-3, AACSB: Reflective Thinking) 6-12.

Describe the elements of the traditional communications model and tell how the updated model differs.

The traditional model of communication includes the components of source, channel, message, receiver, and feedback. The updated model (interactive model) recognizes that .

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there are multiple senders and multiple receivers, all sending and receiving information simultaneously through a central medium. It also recognizes the importance of permission marketing. (15 minutes, Chapter Objective 6-4, AACSB: Reflective Thinking) 6-13.

What is source credibility, and what are two factors that influence our decision as to whether a source is credible?

Source credibility refers to a source’s perceived expertise, objectivity, or trustworthiness.

Factors affecting source credibility are: 1) whether the source’s qualifications are viewed as relevant, and 2) whether or not there is a bias associated with the source. (5-7 minutes, Chapter Objective 6-4, AACSB: Reflective Thinking) 6-14.

What is a halo effect, and why does it happen?

The halo effect occurs when persons who rank high on one dimension are assumed to excel on others as well. It happens because of the transfer of meaning from one object to another. Classical conditioning can help explain how the halo effect works. (5 minutes, Chapter Objective 6-4, AACSB: Reflective Thinking) 6-15.

Marketers must decide whether to incorporate rational or emotional appeals in a communications strategy. Describe conditions that are more favorable to one or the other.

The answer often depends on the nature of the product and the type of relationship consumers have with it. It is hard to gauge the precise effects of rational or emotional appeals. While recall ability of ad content tends to be better for “thinking” ads than for “feeling” ads, conventional measures of advertising effectiveness may not be appropriate to measure the cumulative effects of emotional ads. These measures assess cognitive responses and may penalize feeling ads because the reactions are not as easy to articulate. (5 minutes, Chapter Objective 6-1, AACSB: Reflective Thinking) 6-16.

When should a marketer present a message visually versus verbally?

Visuals should be used when the marketer wants to generate an emotional response.

Because it requires more effort to process, a verbal message is most appropriate for high-involvement situations, such as in print contexts in which the reader is motivated to really pay attention to the advertising. Because verbal material decays more rapidly in memory, messages require frequent exposure to obtain the desired effect. Visual images, in contrast, allow the receiver to chunk information at the time of encoding. Chunking results in a stronger memory trace that aids retrieval over time.

Visual elements may affect brand attitudes in one of two ways. First, the consumer may form inferences about the brand and change his beliefs because of an illustration’s imagery. For example, people in a study who saw an ad for a facial tissue accompanied by a photo of a sunset were more likely to believe that the brand came in attractive colors. Second, brand attitudes may be affected more directly; for example, a strong positive or negative reaction to the visual elements cause will influence the consumer’s .

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attitude toward the ad (Aad) that will then affect brand attitudes (Ab). (15 minutes, Chapter Objective 6-4, AACSB: Reflective Thinking) 6-17.

How does the two-factor theory explain the effects of message repetition on attitude change?

The two-factor theory explains the fine line between familiarity, which can result in favorable attitudes through the mere exposure effect, and boredom, which can result in habituation where the consumer stops paying attention to the ad, by proposing that two separate psychological processes are operating when a person is repeatedly exposed to an ad. The positive side of repetition is that it increases familiarity and thus reduces uncertainty about the product. The negative side is that over time boredom increases with each exposure. At some point, the amount of boredom incurred begins to exceed the amount of uncertainty reduced, resulting in wear-out. (10 minutes, Chapter Objective 64, AACSB: Reflective Thinking) 6-18.

Do humorous ads work? If so, under what conditions?

Humor is more likely to be effective when the brand is clearly identified and the funny material does not “swamp” the message. This danger is similar to one we have already discussed about beautiful models diverting attention from copy points. Subtle humor is usually better, as is humor that does not make fun of the potential consumer. Finally, humor should be appropriate to the product’s image. An undertaker or a bank might want to avoid humor, whereas other products may adapt to it quite well. (10 minutes, Chapter Objective 6-4, AACSB: Reflective Thinking) 6-19.

Why do marketers use metaphors to craft persuasive messages? Give two examples of this technique.

Metaphors allow the marketer to activate meaningful images and apply them to everyday events. In the stock market, “white knights” battle “hostile raiders” using “poison pills;” Tony the Tiger equates cereal with strength, and the Merrill Lynch bull sends the message that the brokerage is “a breed apart.”(5 minutes, Chapter Objective 6-4, AACSB: Reflective Thinking) 6-20.

What is the difference between a lecture and a drama?

A lecture is like a speech in which the source speaks directly to the audience in an attempt to inform them about a product or persuade them to buy it. A drama is similar to a play or movie. (5 minutes, Chapter Objective 6-3, AACSB: Reflective Thinking) 6-21.

What is narrative transportation and how does this apply to persuasion?

Narrative transportation describes the extent to which someone feels immersed in a story and is thus “transported” into the action. Narrative ads are more likely to be shared and to be shared more frequently. Researchers found reviews are more persuasive if they have characteristics that make them resemble a narrative.

(5 minutes, Chapter Objective 6- 3, AACSB: Reflective Thinking) .

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6-22.

Describe the elaboration likelihood model and summarize how it relates to the relative importance of what is said versus how it’s said.

The elaboration likelihood model (ELM) assumes that once a consumer receives a message, she begins to process it. Depending on the personal relevance of this information, the receiver will follow one of two routes to persuasion. Under conditions of high involvement, the consumer takes the central route to persuasion. Under conditions of low involvement, she takes a peripheral route instead. (10 minutes, Chapter Objective 6-4, AACSB: Reflective Thinking) CONSUMER BEHAVIOR CHALLENGE DISCUSS 6-23.

“If it’s on the internet, it must be true.” How big a problem is misinformation about brands? The chapter states that the large majority of Americans no longer trust the accuracy of what they see in mainstream media. Do you agree? What are the ramifications of this distrust for marketers, and how might they improve the situation?

Students’ responses to this question will vary depending on their personal views and beliefs. Ramifications can be significant; however, since this lack of trust could potentially lead to a decline in belief towards all forms of trust in advertising. (5 minutes, Chapter Objective 6-1, AACSB: Reflective Thinking) 6-24.

An antismoking ad sponsored by the New York City Department of Health crossed the line for many viewers. The spot showed a young boy who cries hysterically as a crowd of adults walks by him. The voiceover says, “This is how your child feels after losing you for a minute. Just imagine if they lost you for life.” The ad aroused a lot of controversy because it wasn’t clear if the child was merely acting or if the spot’s producers provoked his tears for the camera. Is this genre of “scared straight” advertising an effective way to convince people to curb unhealthy behaviors like smoking?

Students will find this challenge question more interesting if the instructor shows the clip in class. Although this is an opinion question, students may feel more empathy for the child than for the marketer in this case. The instructor can also show the recently proposed packaging changes from the Food and Drug Administration that were ruled against in court when the cigarette companies proposed the images were designed to get an emotional response instead of delivering facts. (10 minutes, Chapter Objective 6-3, AACSB: Ethical Understanding and Reasoning) 6-25. The Pandora music site attracts about 70 million listeners, who tune in to playlists Pandora creates based on their initial preferences for certain artists. The site uses a music intelligence algorithm to dissect the characteristics of favorite songs and serve up others that are similar. Pandora’s engineers constantly tweak the playlists as they experiment with variations of the experience. For example, do listeners want to hear mostly familiar songs, or do they want to discover new music? One of the biggest issues they wrestle with: How frequently should Pandora repeat the same song or artist in a playlist? The site .

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constantly tries new variations to arrive at the optimal number of repetitions, but it turns out a lot depends on other factors, such as the time of day and where listeners are when they tune in. For example, Pandora’s data show that users welcome new music instead of the same old, same old, but when they’re at work not so much. The company continues to tweak its algorithm as it tries to answer the elusive question, “Can you have too much of a good thing?” What do you think— should music sites like Pandora focus on songs we love now, songs they think we will love, or both?

Students will likely have a lot of opinions to share. Mood congruency, habituation, and implicit attitudes might be discussed as factors considered in Pandora’s approach to playlists.

(30 minutes, Chapter Objectives 6-1 and 6-4, AACSB: Ethical Understanding and Reasoning) 6-26. The sleeper effect implies that perhaps we shouldn’t worry too much about how positively people evaluate a source. Similarly, there is a saying in public relations that “any publicity is good publicity.” Do you agree?

There will certainly be exceptions to this. The good thing about publicity is that it is free.

Thus, when a company of any kind is getting publicity, they are getting free promotion.

The extent to which negative publicity will have positive effects on consumer perceptions simply depends. One of the best-case scenarios is when the negative publicity is controversial and offends people who are not part of the target group, while being perceived in a positive manner by those who are part of the target group. (10 minutes, Chapter Objective 6-4, AACSB: Ethical Understanding and Reasoning) 6-27.

The American Medical Association encountered a firestorm of controversy when it agreed to sponsor a line of healthcare products Sunbeam manufactured (a decision it later reversed). Should trade or professional organizations, journalists, professors, and others endorse specific products?

This question addresses the issue that not all people who endorse products are necessarily celebrities or models. The effect of the endorsement can be very strong, however, because of the element of trust and respect (or even the power of recommendation) that might be involved. Students should think of situations beyond those mentioned in the question that address this issue. A lively discussion should follow. How do the students feel about the ethics involved? In what circumstances should a sitting President, endorse a product? (10 minutes, Chapter Objective 6-4, AACSB: Ethical Understanding and Reasoning) 6-28.

Swiss Legend, a watch brand, gets famous people to wear its colorful timepieces. One way it does this is to give away its product at awards shows. Publicists call this common practice “gifting the talent”: Companies provide stars with “goody bags” full of complimentary products. What do you think about the practice of “gifting the talent” to accumulate endorsements? Is this a sound strategy? Is it ethical for celebrities to accept these gifts?

Although this may be considered a gray area promotional technique, it does not carry with it the level of deception that flogging does. Many fans and viewers are aware that .

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when stars are wearing things at events, they have been given those items or are even paid to wear such. For those that are not aware of this, there is no information given that implies that the star bought the apparel or accessory item of their own volition. At the most basic level, it is a minimal investment with the potential for very effective media coverage. (15 minutes, Chapter Objective 6-4, AACSB: Reflective Thinking and Ethical Understanding and Reasoning) 6-29.

Watchdog groups have long decried product placements because they blur the line between content and advertising without adequately informing viewers. The networks themselves appear to be divided on how far they want to open the gate. According to one study, the effectiveness of product placement varies by product category and type of placement. Consumers indicate that product placements have the most influence on their grocery, electronics, and apparel purchases.

The most common platform for a placement is to get a brand shown on a T-shirt or other piece of an actor’s wardrobe. What do you think about this practice? Under what condition is product placement likely to influence you and your friends? When (if ever) is it counterproductive?

Product placement and celebrity endorsement can add credibility and recognition.

Product placement is the insertion of real products in fictional movies, TV shows, books, and plays. A study reported that consumers respond well to placements when the show’s plot makes the product’s benefit clear. Audiences also have a favorable impression when a retailer provides furniture, clothes, appliances, and other staples for struggling families. These actions generate feelings of emotional security. However, when the placement is not consistent with the plot, the brands can be negatively affected because they seem out of place. (5 minutes, Chapter Objective 6-4, AACSB: Reflective Thinking) 6-30. One of the most controversial intersections between marketing and society occurs when companies provide “educational materials” to schools. Many firms, including Nike, Hershey, Crayola, Nintendo, and Foot Locker, provide free book covers swathed in ads.

Standard art supplies, blocks, trucks, and dolls get supplemented with Milton Bradley and Care Bears worksheets, Purell hand-cleaning activities, and Pizza Hut reading programs.

Clearasil provides sample packets of its acne medication along with brochures to educate high school students about proper skin care; the handouts also direct students to the Clearasil website where they can register for music downloads and iPods. Other companies contract with schools to run focus groups with their students during the school day to get reactions to new product ideas. Some schools encourage kids to practice their math as they count Tootsie Rolls, and the kids use reading software that bears the logos of Kmart, Coke, Pepsi, and Cap’n Crunch cereal. Many educators argue that these materials are a godsend for resource-poor schools that otherwise could not provide computers and other goodies to their students. However, a California law bans the use of textbooks with brand names and company logos. This legislation was prompted by complaints from parents about a middle-school math book that uses names such as Barbie, Oreos, Nike, and Sony PlayStation in word problems. What’s your position on these practices? Should corporations be allowed to promote their products in schools in exchange for donations of educational materials, computers, and so on?

Student responses will vary but may include discussions on product placement benefits and drawbacks. Some students might consider a comparison with advergaming. .

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Advergaming is the practice of integrating brands and products with the stories the game tells, much like integrating brands in textbooks and homework activities. (10 minutes, Chapter Objective 6-4, AACSB: Ethical Understanding and Reasoning) 6-31.

Some consumer advocates worry that the above forms of weaving brands and products in the content of entertainment amounts to covert advertising, a form of advertising that works under the guise of non-advertising formats. The U.S.’s Children’s Advertising Review Unit expressed concern that sponsors were not appropriately disclosed in child influencer unboxing videos. A study testing the potential usefulness of disclosing sponsorship of those videos found that pre-roll warnings helped the parents be more aware of the sponsorship, and hopefully in turn more mindful about explaining these persuasion attempts to their children.

Whether it’s sponsored digital content, native advertising, product placement, or advergaming, the concern is that consumers do not recognize the persuasive nature of the ad, so they are being tricked. Do you agree?

Student responses will vary. There may be strong opinions about persuasion attempts to children. (10 minutes, Chapter Objective 6-4, AACSB: Ethical Understanding and Reasoning)

6-32. Commercial Alert, a consumer group, is highly critical of neuromarketing. The group’s executive director wrote, “What would happen in this country if corporate marketers and political consultants could literally peer inside our brains and chart the neural activity that leads to our selections in the supermarket and voting booth? What if they then could trigger this neural activity by various means, so as to modify our behavior to serve their own ends?” What do you think? Is neuromarketing dangerous?

Neuromarketing techniques rely on sophisticated devices like the MRI to understand how our brains respond to marketing messages. There may be some strong opinions about how far firms should go. Just because the technology is available, does it mean we should use it? (10 minutes, Chapter Objective 6-1, AACSB: Ethical Understanding and Reasoning) 6-33.

A recent study’s findings sum up the impact of sex appeals: Yes, they get noticed and remembered—but many viewers don’t recall what the ad was plugging! And, males do like provocative messages more than females, but this doesn’t translate into stronger brand attitudes. Another study looked specifically at the issue of whether sexy ads increase desire for romantic products. According to human evolutionary theory, men tend to be primed to take advantage of sexual opportunities whenever they are reasonably available, as relationships with multiple partners maximizes the likelihood that their genes will be passed on. Therefore, the researchers reasoned, they should dislike objects that don’t help them to achieve this goal. Sure enough, when male subjects saw highly sexual ads, they reported less interest in joining the long-term dating site eHarmony.com or buying jewelry from Kay Jewelers. This diminished interest did not occur for female subjects. What’s your position on the use of sex in advertising? Should brands “engage” viewers with titillating imagery? .

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Some students may suggest that erotic content can be counterproductive. Others may suggest that sexual appeals may work well when the product is related to sex. (10 minutes, Chapter Objective 6-4, AACSB: Reflective thinking) APPLY 6-34.

Think of a behavior someone does that is inconsistent with his or her attitudes (e.g., attitudes toward cholesterol, drug use, or even buying things to make them stand out or attain status). Ask the person to elaborate on why he or she does the behavior and try to identify the way the person has resolved dissonant elements.

Students should be able to generate many diverse examples of this type of consumer behavior. Assume you are a high school student who is health conscious but who may smoke occasionally because your friends smoke. The reason you smoke may be to “fit in” with a group, or the behavior may serve as some type of initiation into the group. You may resolve dissonant elements by telling yourself that an occasional cigarette will not hurt you as long as you keep exercising and eating right.

(25 minutes, Chapter Objective 6-1, AACSB: Reflective Thinking) 6-35. Construct a multiattribute model for a set of local restaurants. Based on your findings, suggest how restaurant managers can improve an establishment’s image via the strategies described in this chapter.

The multi-attribute models that students develop for a set of local restaurants should include: • A number of product attributes—characteristics of the restaurants, such as price, type of foods, number of menu items, location, etc.

• Beliefs regarding specific restaurants (in terms of attributes).

• Important weights reflecting the relative priority of specific attributes for them individually.

Although there likely will be some common elements in the models developed, students should be encouraged to think about how each model is reflective of the individual responsible for the product evaluation. The instructor should point out to students the complexity of consumer attitudes, as demonstrated by the diversity of attitudinal statements, product attributes, beliefs, and importance weights that might be chosen.

(Possible Individual or Group Field Project Idea) (75 minutes, Chapter Objective 6-2, AACSB: Analytical Thinking) 6-36. Locate foreign ads at sites like japander.com in which celebrities endorse products they do not pitch on their home turf. Ask friends or classmates to rate the attractiveness of each celebrity, then show them these ads and ask them to rate the celebrities again. Does the star’s “brand image” change after it is paired with cheesy ads? Based on these results, what advice would you give to a manager who has to choose among endorsement offers for a famous client?

.

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Student responses should address how messages build credibility and source attractiveness. Students may also recognize the application of Classical Conditioning, where the negative association has the potential to transfer from the product, or the act of endorsing the product if the celebrity is a serious actor, to the celebrity. (20 minutes, Chapter Objective 6-4, AACSB: Reflective Thinking) 6-37. Collect ads that rely on sex appeal to sell products. How often do they communicate benefits of the actual product? How effective do you believe they are?

Students will be able to find examples of products that use sex appeal in almost any magazine, but magazines targeted toward men or women are the best sources. NOTE: Be sure to examine ads before they are presented to the class. Some students are carried away (especially the males) and present material that is offensive to other class members (especially the females). The instructor should not rely solely on the students’ judgment in this matter. (Possible Field Project Idea) (30 minutes, Chapter Objective 6-4, AACSB: Reflective Thinking) 6-38. Observe the process of counterargumentation by asking a friend to talk aloud while watching a commercial. Ask him to respond to each point in the ad or to write down reactions to the claims the message makes. How much skepticism regarding the claims can you detect?

Students will enjoy this project. You might encourage a student to videotape a few ads and show the tape to a friend. This will give the student an opportunity to choose a few ads that make a number of claims that can be analyzed. (Possible Field Project Idea) (15 minutes, Chapter Objective 6-3, AACSB: Reflective Thinking) 6-39. The chapter discusses the important problem of medication adherence. How can healthcare marketers strengthen the link between intentions and behavior to boost the rate at which people actually take their prescribed medications? Devise a communications strategy to increase the adherence rate.

The responses and communication strategy will be different for each student. Students should address the inconsistency between attitudes and behaviors. The theory of reasoned actions indicates there is a difference between intentions and behaviors. The communication strategy should target the behavior more than the intention. It should also address normative influences that can result in a contradiction between what we say we will do and what we actually do. (5 minutes, Learning Objective 6-1, AACSB: Reflective Thinking) 6-40. Make a log of all the commercials shown on a network channel shows during a two-hour period. Assign each to a product category and decide whether each is a drama or an argument. Describe the types of messages the ads use (e.g., two-sided arguments) and keep track of the types of spokespeople who appear (e.g., TV actors, famous people, animated characters). What can you conclude about the dominant forms of persuasive tactics marketers currently employ? .

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The instructor might want to encourage students to work in pairs to better manage the recording of 10- and 15-second commercials. One person could write about one commercial while the other person is listening to the next commercial. (Possible Field Project Idea) (150 minutes, Chapter Objective 6-3, AACSB: Ethical Understanding and Reasoning) 6-41. A metaphor places two dissimilar objects into a close relationship such that “A is B,” whereas a simile compares two objects such that “A is like B.” A and B, however dissimilar, share some quality that the metaphor highlights. Metaphors allow the marketer to apply meaningful images to everyday events. In the stock market, “white knights” battle “hostile raiders” with the help of “poison pills”; Tony the Tiger equates cereal with strength; and “you’re in good hands with Allstate” insurance.

Collect examples of ads that rely on the use of metaphors or similes. Do you feel these ads are effective? If you were marketing the products, would you feel more comfortable with ads that use a more straightforward, “hard-sell” approach? Why or why not?

Students will find a variety of product ads relying on both metaphors and similes.

Students may develop a heightened awareness for this approach to ads. Responses about ad effectiveness are likely to vary.

(5 minutes, Learning Objective 6-1, AACSB: Reflective Thinking) 6-42. A brand that wants customers to see it as a “friend” by depicting a model using it is more effective when the product image appears horizontally and near the model. On the other hand, if a brand wants customers to see it as a “leader,” the advertiser will have better luck if it physically places the brand above the user and farther away (“it’s lonely at the top”). Create a mockup of two versions of an ad that depict the same brand as either a “friend” or a “leader.”

Students should enjoy this hands-on challenge applying course concepts.

(5 minutes, Learning Objective 6-4, AACSB: Analytical Thinking) 6-43. Devise an attitude survey for a set of competing automobiles. Identify areas of competitive advantage or disadvantage for each model you include.

The semantic-differential scale often is used to describe a consumer’s beliefs about product, brands, and /or companies. Students are likely to develop scale items reflecting a variety of beliefs about individual products, where a set of product attributes is rated on a series of scales. For example: My travel agent is: Very efficient Very accessible Very friendly

1—2—3—4—5—6—7 1—2—3—4—5—6—7 1—2—3—4—5—6—7

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Chapter 6: Attitudes and How to Change Them

Semantic-differential scales also may be used to compare the images of competing brands, as in the next example: Honda Accords have good interior features.

Agree 1—2—3—4—5—6—7

Disagree

Toyota Camry’s have good interior features.

Agree 1—2—3—4—5—6—7

Disagree

Chevrolet Malibu’s have good interior features.

Agree 1—2—3—4—5—6—7 (90 minutes, Chapter Objective 8-2, AACSB: Analytic Skills)

Disagree

6-44. A government agency wants to encourage people who have been drinking to use designated drivers. What advice could you give the organization about constructing persuasive communications? Discuss some factors that might be important, including the structure of the communications, where they should appear, and who should deliver them. Should it use fear appeals? If so, how?

A persuasive communication should consider the source, the message, the medium, the receivers, feedback, and consumer-to-consumer exchanges around the source, the message, and the medium.

(90 minutes, Chapter Objective 6-4, AACSB: Analytical Thinking)

CASE STUDY TEACHING NOTES Chapter 6 Case Study: Anti-Smoking Advertising - Can You Be Scared into Quitting?

Summary of Case This case is focused on cause advertising: the cause of discouraging smoking. Discussion could center around the challenges of discouraging consumption and/or the use of fear in advertising.

The information about when fear does and does not work provides an opportunity for a more detailed discussion of the use of fear in persuasive communications. It also underscores the recognition that target markets often have multiple sub segments, each requiring a different kind of appeal.

Suggestions for Presentation A good starting point would be to discuss how cause advertising is the same and how it is different from encouraging people to buy and consume products and services in a for-profit scenario.

Suggested Answers for Discussion Questions .

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CS 8-1. What is another health, political, or philanthropic cause that could benefit from an advertising campaign? Create two taglines that could be used: one for people who are prevention-focused and another for those who are promotion-focused.

Student answers will vary.

Prevention-focused people are concerned with possible negative outcomes.

Consumers who are promotion-focused are concerned with aspirations and achievements.

Tagline ideas should have an identifiable tone (e.g., humor, fear, information, etc.), should have a clear link to the cause, and should be memorable.

(10 minutes, Chapter Objectives 3 & 4, AACSB: Reflective Thinking CS 8-2. Health warnings have appeared on cigarette packages for almost 50 years. Discuss how habituation, or a decline in responsiveness due to repeated exposure (see Chapter 4), may be a factor affecting their effectiveness. In 134 countries, graphic images related to smoking’s effects must also be shown on the packages. Why or why not might this help smokers decide to quit?

Habituation occurs when the consumer no longer pays attention to the stimulus because of fatigue or boredom. Excessive exposure can cause advertising wear-out, which can result in negative reactions to an ad after we see it too often.

The two-factor theory explains the fine line between familiarity and boredom; it proposes that two separate psychological processes operate when we repeatedly show an ad to a viewer. The positive side of repetition is that it increases familiarity and thus reduces uncertainty about the product. The negative side is that over time boredom increases with each exposure. At some point the amount of boredom exceeds the amount of uncertainty the message reduces, and this results in wear-out.

The introduction of graphic images may jolt some smokers (and would-be smokers) into paying attention to warnings, but even these horrific images could lose their impact over time. One approach that might slow habituation is to vary the words and images used so that consumers see different versions of the warnings.

(10 minutes, Chapter Objective 2, AACSB: Application of Knowledge)

CS 8-3.

How can a marketer determine what kinds of appeals will be the most persuasive in making the case for a product or cause? Design a simple experiment using the cause you chose for question CS 6.1 above.

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Focus groups can provide useful input. Testing attitudes about the cause before and after being exposed to ads would be one approach. Experiments that use more indirect methods may be useful, such as one experiment that exposed teens to anti-smoking posters displayed in a convenience store. For an example, see: http://wesa.fm/post/graphic-anti-smoking-posters-might-encourage-some-kids-usecigarettes#stream/0 (10 minutes, Chapter Objective 3, AACSB: Reflective Thinking)

MULTIPLE CHOICE QUESTIONS 1. The Centers for Disease Control advertisements on smoking cessation or smoking prevention use __________ appeals. a. fear b. intellectual c. truth d. informational e. shock Correct response: a Fear appeals have been shown to be reasonably effective in most cases. However, fear appeals can have the opposite effect if smokers become defensive and downplay the risks.

2. A __________ smoking cessation ad focuses on aspirations and achievements and the positives associated with quitting tobacco use. a. prevention-focused b. promotion-focused c. fear based d. truth campaign e. funny Correct response: b A promotion-focused smoking cessation ad focuses on aspirations and achievements and the positives associated with quitting tobacco use. These types of ads reach a different consumer group that may not respond to fear based or prevention-focused ads.

3. Anti-smoking campaigns and smoking cessation programs have been __________ in the United States and the number of smokers is __________. a. very effective; near zero b. unproductive; unchanged c. quite effective; at a new low d. ineffective; at a new high e. largely ineffective; around 42% of the population Correct response: c

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Anti-smoking campaigns and smoking cessation programs have been quite effective in the United States and the number of smokers is at a new low. However, new data suggest that smoking increased during the pandemic shutdown of 2020.

4. The two statements “Smoking causes cancer” and “I smoke cigarettes” create a feeling of __________ that may cause someone to quit smoking. a. cognitive dissonance b. cognitive resonance c. internalization d. cognitive consistency e. object-orientation Correct response: a The two statements “Smoking causes cancer” and “I smoke cigarettes” create a feeling of cognitive dissonance that may cause someone to quit smoking. Cognitive dissonance occurs when we are confronted with inconsistencies that cause us to feel uncomfortable.

5. Which of these psychological principles should be the most effective in causing people to change their attitude with regard to smoking? a. Scarcity b. Authority c. Reciprocity d. Consistency e. Liking Correct response: b The psychological principle that should be the most effective in causing people to change their attitude with regard to smoking is authority. Many anti-smoking campaigns use medical professionals or people who have suffered from cigarette smoking. These individuals can speak with authority about the topic.

Additional Support Material STUDENT PROJECTS Individual Projects 1.

Have students explain the consistency, balance, and Fishbein theories to a friend, and then ask the friend to analyze two of his/her recent experiences that seem to confirm or disconfirm one or more of these theories. Report the findings to the class.

To be able to explain it to a friend, the student must understand each of the theories and be able to differentiate between the theories. Thus, this is a useful exercise for reinforcing the theories. Further, students get feedback from a friend that allows them to think .

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critically about whether the theory relates to his/her experiences. (15 minutes, Chapter Objective 6-1, AACSB: Reflective Thinking and Written and Oral Communication) 2.

It is time for true confessions. Describe three instances when your purchase behavior was inconsistent with an attitude toward the product or service you were buying. Explain why this happened. Share this with the class, asking them if they agree with the explanation or whether they have other notions.

Students may provide examples where outside influences intervened, they did not have the resources to select the product/service they really wanted, or where they only had certain products or services available because of the location or an out of stock situation. (10 minutes, Chapter Objective 6-2, AACSB: Reflective Thinking and Written and Oral Communication)

3.

Have students prepare an example of the Fishbein model and present the findings to the class.

Students should identify attributes that are important to attitude formation, ask the respondents to note the importance of each attribute, and then ask the respondents to rate the brands on those attributes. The attitude score will be with the sum of the weighted beliefs (importance rating x belief rating) for all of the attributes for each brand. (30 minutes, Chapter Objective 6-1, AACSB: Analytical Thinking and Written and Oral Communication)

4.

Ask one of your students to interview three people and have each respondent identify an advertisement that they have a positive attitude toward and an ad to which they have a negative attitude. Be sure to inquire to find out how their attitudes toward the ads influence their attitudes toward the products and likelihood of purchase.

Favorable attitudes toward an ad often will result in favorable attitudes toward the product, especially in cases where the consumer does not have direct experience with the product. In general, experience is more powerful than advertising in consumer evaluations of a product. (45 minutes, Chapter Objectives 6-2 and 6-3, AACSB: Reflective Thinking)

5.

Have students conduct a simple content analysis by examining either print or broadcast ads. They may find such ads in real sources such as magazines, newspapers, or by watching television. They may also find such ads online at websites that maintain archives of advertisements. Students should view numerous ads and analyze which of the following message appeals appear to be used: (a) emotional, (b) rational, (c) sex, (d) humorous, and (e) fear. Does the medium or specific media vehicle influence which appeals are used most commonly? After conducting this analysis, have students explain which appeal(s) is most powerful. Most persuasive? Most credible?

This extensive project may be appropriate as an individual project outside of class.

Students should receive enough time to complete the content analysis and a general idea .

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of the time frame and number of ads they should evaluate. The assignment requires critical thinking about the use of different types of claims, so it should reinforce a basic understanding of the claims as well as provide students with exposure of how and when they are used. (90 minutes, Chapter Objective 6-4, AACSB: Reflective Thinking) 6.

Bring in a number of print or television ads that rely on the use of metaphors or resonance (or have your students do it). Have the students discuss the ads in groups. What are their initial reactions to the ads? How effective do they think they are? Do they think some other approach would be more convincing? Why? This exercise will reinforce the concepts of metaphors and resonance and provide students with the opportunity to think critically about their effectiveness. Students that provide another approach should provide their reasoning for the suggestion. (40 minutes, Chapter Objective 6-4, AACSB: Reflective Thinking and Analytical Thinking)

Group Projects 1.

Give the class a list of eight or ten common generic products (e.g., cars, peanut butter, detergent, toothpaste, gasoline, toilet paper, microwave dinners, a professional football team, an airline, and a soft drink) and ask them to list their favorite brand(s) of the product. See if those who are participating know how they developed their brand preference and how the products’ attributes are related to their attitudes toward the product(s).

This exercise will provide the opportunity for students to discuss differences in the formation of brand preferences and the importance of different attributes, which will help reinforce the information about attitude formation. (30 minutes, Chapter Objectives 6-1 and 6-2, AACSB: Reflective Thinking)

2.

Divide the class into teams and have each team come up with a set of about ten descriptive words that could be used to positively or negatively describe a specific consumer good (e.g., a stereo, car, expensive clothing, etc.). Send students out to interview a friend who owns this product. Determine the length of time the respondent has owned the product and then have the respondent evaluate the product according to some criteria determined by the class. See if the people who more recently purchased the product have a more positive attitude toward it than those who have owned it for a longer period.

Students will analyze the length of the relationship with the product relative to the attitudes associated with the product. In some cases, recent consumers may have a honeymoon effect or will have a strong emphasis on positive aspects of the product to overcome cognitive dissonance. However, in general, commitment to positive attitudes is likely to increase over time. Because of time involved in the exercise, the instructor may wish to do this in class between groups or only have a few students participate in the project. (60 minutes, Chapter Objective 6-2, AACSB: Analytical Thinking)

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3.

Ask a group of students to think about restaurants they like and do not like to patronize.

Have them design a multi-attribute model for three of these restaurants, making sure both spectrums are included. Have students make suggestions of how the managers could improve the restaurants’ image by following the strategies and tactics found in this chapter.

Student measurement should include the importance of the attributes as well as the beliefs about the attributes. Ways to change the attitudes may include adding an attribute, changing beliefs (about one of the brand’s attributes or a competitor’s attribute), and changing importance ratings. (30 minutes, Chapter Objective 6-1, AACSB: Reflective Thinking)

4.

Bring in a number of print or television ads that use celebrity endorsers (or have students do it). Have students get into groups to discuss how effective they think the ads are. By evaluating the spokesperson as either “good” or “poor,” determine whether the class likes the celebrity. Do they find the ads believable or contrived? Probe to find out why they feel this way.

This is a critical thinking exercise where students make judgments about the effectiveness of a celebrity endorser based on the characteristics described in the chapter (attractiveness, credibility, fit with the product, etc.). (15 minutes, Chapter Objective 6-4, AACSB: Reflective Thinking)

5.

Have student groups collect ads that demonstrate the literary devices of allegory, metaphor, simile, and resonance. Have them discuss the effectiveness of such with the class.

Look for students to understand what each of the concepts is and differences between the techniques. The perception of effectiveness of each technique is likely to depend on the product category, familiarity with the brand, and other aspects of the execution. (30 minutes, Chapter Objective 6-4, AACSB: Reflective Thinking)

6.

Have groups of students take a common consumable product and apply a fear appeal to promoting the product. Have the students critique the effort with respect to the material presented in the chapter on using fear appeals. Have them do the same for applying a humor appeal to a commonly serious product.

Students should recognize that moderate fear appeals are most effective; consumers shut down or avoid attending to high fear appeals, and low fear appeals do not motivate a consumer response. Students should also recognize that using humor to promote a serious product might backfire. (20 minutes, Chapter Objective 6-4, AACSB: Reflective Thinking,)

ONLINE ASSIGNMENTS

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Individual Assignments 1.

Go to www.levistrauss.com. Levi Strauss used to dominate the jeans market. It was a mainstay product for youth in the ’50s, ’60s, and ’70s. Something happened in the ’80s and ’90s, however, that caused the youth to begin shifting their attention to other brands and different ways of dressing. What did attitudes have to do with this shift? How should the company best deal with these changes? Using yourself as an example, tell Levi’s what they must do to secure your business again. If you are already a customer, explain what the company must do to keep your business.

The trip to the website is important if the student is not a customer or is not familiar with Levi Strauss products. The things the students will want Levi’s to do to earn their business will depend on what motivates the students to buy clothes and the attributes that are important to the students. (15 minutes, Chapter Objectives 6-3 and 6-4, AACSB: Reflective Thinking)

2.

Visit http://www.levistrauss.com/sustainability/. Read their statements and policies regarding environment, community, diversity, etc. What is the students’ attitude toward the policies of Levi Strauss? What is their level of commitment to their attitude toward Levi Strauss Company?

The students’ attitudes toward the company, based on its corporate responsibility practices, may be different from their attitudes toward the products it makes. Students are likely to talk about the standard learning hierarchy since they are evaluating information about the policies, and then deciding how they feel about it and behaving based on those cognitions and feelings. (15 minutes, Chapter Objective 6-2, AACSB: Reflective Thinking)

3.

Visit www.izod.com. Is a multi-attribute model a good one to apply to this product to explain how attitudes are formed? Why or why not? Suggest an alternative model.

Izod products may be expensive, so even if a consumer has a positive attitude toward the product, they may not act on that attitude. The theory of trying may be an appropriate alternative model. (15 minutes, Chapter Objective 6-1, AACSB: Reflective Thinking)

4.

Go to https://www.ge.com/products. Pick a product from the huge portfolio of General Electric. This product should be one that you do not use or do not have a negative attitude.

Design a brief advertising campaign that would persuade you to use the product. Explain the process that you went through and the principles from the chapter you used in your campaign.

Students should address the attributes about which they have negative beliefs in the campaign. Students should recognize how beliefs relate to attitudes. (15 minutes, Chapter Objectives 6-3 and 6-4, AACSB: Reflective Thinking)

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Chapter 7: Deciding

Chapter 7: DECIDING

CHAPTER OBJECTIVES When students finish this chapter, students should be able to: 7- 1. Identify the two primary ways in which consumers make decisions.

7- 2. Outline the steps of the rational (slow) decision making process.

7- 3. Summarize the ways in which we engage in fast thinking and rules of thumb to make decisions.

7- 4. Describe how context effects can influence the decision making of a consumer, even when the consumer is unaware of the influence.

7- 5. Discuss how online shopping and purchasing platforms can influence consumer decision making.

CHAPTER SUMMARY Identify the two primary ways in which consumers make decisions.

Every consumer decision we make is a response to a problem. Of course, the type and scope of these problems varies enormously. We make some decisions thoughtfully and rationally as we carefully weigh the pros and cons of different choices. In other cases, we let our emotions guide us to one choice over another as we react to a problem with enthusiasm, joy, or even disgust.

Decision-making researchers refer to these distinct ways of thinking as slow and fast thinking.

Perspectives on decision making range from a focus on habits that people develop over time to novel situations involving a great deal of risk in which consumers must carefully collect and analyze information before making a choice. Many of our decisions are highly automated; we make them largely by habit.

Outline the steps of the rational (slow) decision making process.

A typical decision involves several steps. The first is problem recognition, when we realize we must take some action. This recognition may occur because a current possession malfunctions or perhaps because we have a desire for something new. Once the consumer recognizes a problem and sees it as sufficiently important to warrant some action, they begin the process of information search. This search may range from performing a simple memory scan, to determining what they have done before to resolve the same problem, to extensive fieldwork during which they consult a variety of sources to amass as much information as possible. In the evaluation of alternatives stage, the options a person considers constitute their evoked set. When the consumer eventually must make a product choice among alternatives, they use one of several decision rules. Noncompensatory rules eliminate alternatives that are deficient on any of the criteria they’ve chosen. Compensatory rules, which consumers are more likely to apply in highinvolvement situations, allow them to consider each alternative’s good and bad points more carefully to arrive at the overall best choice. Once the consumer makes a choice, they engage in .

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postpurchase evaluation to determine whether it was a good one; this assessment, in turn, influences the process the next time the problem occurs.

Summarize the ways in which we engage in fast thinking and rules of thumb to make decisions.

In many cases, people engage in surprisingly little research. Instead, they rely on various mental shortcuts, such as brand names or price, or they may simply imitate others’ choices. We may use heuristics, or mental rules of thumb, to simplify decision making. One of the most common beliefs is that we can determine quality by looking at the price. Other heuristics rely on wellknown brand names or a product’s country of origin as signals of product quality. When we consistently purchase a brand over time, this pattern may be the result of true brand loyalty or simply inertia because it’s the easiest thing to do.

Describe how context effects can influence the decision making of a consumer, even when the consumer is unaware of the influence.

Principles of mental accounting demonstrate that the way a problem is framed and whether it is put in terms of gains or losses influences what we decide. In addition, other cues in the environment—including subtle ones of which we may not even be aware—may prime us to choose one option over another. A prime is a stimulus that encourages people to focus on some specific aspect of their lives. Much of the current work in behavioral economics demonstrates how a nudge—a deliberate change by an organization that intends to modify behavior—can result in dramatic effects.

Discuss how online shopping and purchasing platforms can influence consumer decision making.

The internet has changed the way many of us search for information. Today, our problem is more likely weeding out excess detail than searching for more information. Comparative search sites and intelligent agents help to filter and guide the search process. We may rely on cybermediaries, such as web portals or AI programs, to sort through massive amounts of information to simplify the decision-making process.

CHAPTER OUTLINE I.

Fast or Slow Thinking?

Every consumer decision made is a response to a problem.

We make some decisions thoughtfully and rationally (slow thinking). In other cases, we let our emotions guide us (fast thinking).

We may create a mental budget that helps us to estimate what we will consume over time so that we can regulate what we do in the present.

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Use Chapter Objective 7-1 Here Use Key Terms slow thinking, fast thinking, and mental budget Here Use Consumer Behavior Challenge 7-30 Here II.

Rational (Slow) Decision Making When they think slowly, consumers approach decision making from a rational perspective. Traditionally, consumer researchers approached decision making from a rational perspective. According to this view, people integrate as much information as possible with what they already know about a product, weigh the pluses and minuses of each alternative, and arrive at a satisfactory decision.

A. Steps in the Cognitive Decision-Making Process The steps in decision making are: (1) problem recognition, (2) information search, (3) evaluation of alternatives, and (4) product choice. i. Step 1: Problem Recognition Problem recognition occurs when we experience a significant difference between our current state of affairs and some state we desire. ii. Step 2: Information Search Information search is the process by which we survey the environment for appropriate data to make a reasonable decision.

As a general rule, we search more when the purchase is important, when we have more of a need to learn more about the purchase, or when it’s easy to obtain the relevant information.

Because experts have a better sense of what information is relevant to the decision, they engage in selective search, which means their efforts are more focused and efficient.

A filter bubble occurs when the broadcast media, websites, and social media platforms we consult serve up answers based upon what they “think” we want to see. iii. Step 3: Evaluate Alternatives

The alternatives a consumer knows about are called the evoked set and the ones they seriously consider are known as the consideration set. a. Evaluative Criteria Evaluative criteria are the dimensions we use to judge the merits of competing options.

Criteria on which products differ from one another carry more weight in the decision process than do those where the alternatives are similar.

Determinant attributes are the features we actually use to differentiate among our choices. b. Decision Rules To choose between options, consumers may use compensatory and noncompensatory rules. Under conditions of high cognitive involvement, people tend to think carefully about the pros and cons of various options. c. Compensatory Rules .

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A compensatory rule allows a product to make up for its shortcomings on one dimension by excelling on another. It is more likely to apply during type I thinking. There are two basic types of compensatory rules: The simple additive rule leads to the option that has the largest number of positive attributes.

A weighted additive rule allows the consumer to take into account the relative importance of the attributes by weighting each one. d. Noncompensatory Rules When we make habitual or emotional decisions, we use a noncompensatory rule. This means that if an option doesn’t suit us on one dimension, we just reject it out of hand and move on to something else.

• The lexicographic rule says, “select the brand that is the best on the most important attribute.”

• The elimination-by-aspects rule is similar to the lexicographic rule because the buyer evaluates brands on the most important attribute. In this case, though, s/he imposes specific cut-offs.

The conjunctive rule entails processing by brand. As with the elimination-by-aspects procedure, the decision maker establishes cut-offs for each attribute. However, here s/he chooses a brand if it meets all the cutoffs but rejects a brand that fails to meet any one cut-off. iv. Step 4: Product Choice Once we assemble and evaluate the relevant options in a category, eventually we have to choose one.

Feature creep occurs when products become too overly complex with myriad features the typical consumer cannot or has difficulty understanding. This condition of choice overload, or hyperchoice, forces us to make repeated decisions that may drain psychological energy while decreasing our abilities to make smart choices.

Consumers tend to want more options, but when there are too many options, they tend to make poorer decisions or just give up in frustration; this is the paradox of choice. v. Step 5: Postpurchase Evaluation Postpurchase evaluation closes the loop; it occurs when we experience the product or service we selected and decide whether it meets our expectations. a. Social Scoring In the process called social scoring, both customers and service providers increasingly rate one another’s performance. b. Regret and How to Avoid It When we do not select a certain option and this foregone option now seems better than the option that we chose, we may end up experiencing regret.

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Regret makes people less likely to repurchase the chosen products, but it does not make people more likely to complain to the maker of that product. c. “Deer-in the Headlights”: Decision Paralysis Although consumers tend to like to make their own choices, having to choose sometimes leads to anxiety and decision paralysis.

Use Chapter Objective 7-2 Here Use Key Terms rational perspective, problem recognition, information search, filter bubble, evoked set, consideration set, evaluative criteria, determinant attributes, compensatory rule, simple additive rule, weighted additive rule, noncompensatory rule, lexicographic rule, elimination-by-aspects rule, conjunctive rule, feature creep, choice overload, hyperchoice, paradox of choice, postpurchase evaluation, social scoring, and decision paralysis Here Use Review Questions 7-2, 7-3, 7-6, 7-11, and 7-13 Here Use Consumer Behavior Challenges 7-22, 7-24, 7-25, 7-26, 7-28, and 7-30 Here

III.

Fast Thinking and Rules of Thumb The rational decision-making steps are well and good, but common sense tells us we don’t undergo this elaborate sequence every time we buy something.

Habitual decision making describes the choices we make with little or no conscious effort.

Why does a person buy the same brand over and over? In some cases, the explanation is inertia, which means that it involves less effort to pick a familiar brand. Or it could be brand loyalty, which describes a pattern of repeat purchasing behavior that involves a conscious decision to continue buying the same brand.

A. Behavioral Biases Homo economicus (“economic man”), regards us as ideal decision makers with complete rationality and complete access to all the information we need to make an informed decision.

But the reality is that we just don’t work that hard for most decisions. One reason is that it’s not possible for our brains to process all that detailed information about everything, nor is it probably worth our time. Another reason is that we often are less homo economicus and more homo ludens – “man the player.” This view recognizes the more light hearted aspects of consumption.

A survey found that about one-fifth of Americans admitted to buying while under the influence, or drunk shopping.

System I processing can lead to behavioral biases, when our preferences deviate from the standard economic model that views people as rational decision makers who calmly and carefully weigh their choices to be sure they make the best possible decision.

Behavioral economics focuses upon these biases that take the form of nonstandard beliefs. .

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B. Heuristics and Mental Accounting: Take the Shortcut • Maximizing solution: We want to arrive at the best result possible outcome.

• Satisficing solution: We seek simply to receive an adequate outcome.

• This “good enough” perspective on decision making is called bounded rationality.

1. Mental Accounting Many habitual spending decisions we make are subject to mental accounting biases. This reminds us that the way we think and use money depends on all kinds of subjective factors.

2. Heuristics These “mental rules-of-thumb” shortcuts are referred to as heuristics. (Table 7.2)

Use Chapter Objective 7-3 Here Use Key Terms habitual decision making, inertia, brand loyalty, homo economicus, homo ludens, drunk shopping, behavioral biases, standard economic model, behavioral economics, nonstandard beliefs, maximizing solution, satisficing solution, bounded rationality, mental accounting, and heuristics Here Use Review Questions 7-1, 7-8, 7-9, 7-10, 7-18, and 7-19 Use Consumer Behavior Challenges 7-23, 7-25, 7-27, and 7-32 Here

IV.

The Unseen Power of Context Effects: Framing, Priming, and Nudging Physical cues “prime” us to react even when we are not aware of the impact. The sensations we experience are context effects that subtly influence how we think about products we encounter.

Framing is how we pose a question to people or what exactly we ask them to do.

Loss aversion is the idea that people hate losing things more than they enjoy getting things.

Researchers who work on prospect theory analyze how the value of a decision depends on gains or losses; they identify principles of mental accounting that relate to the way we frame the question.

Under the sunk-cost fallacy, if we have paid for something, we are more reluctant to waste it.

A. Priming

Priming involves including cues in the environment that make us more likely to react in a certain way even though we’re unaware of these influences. A prime is a stimulus that encourages people to focus on some specific aspect of their lives.

Temporal framing also makes a difference. Framing something in a message as .

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coming at the end of a time period shifts our attention to the left, while framing something as coming at the beginning of a time period shifts our attention to the right.

B. Nudging

Much of the current work in behavioral economics demonstrates how a nudge—a deliberate change by an organization that intends to modify behavior—can result in dramatic effects.

An urgency nudge is a nudge for consumers to act immediately.

A default bias is evident when we are more likely to comply with a requirement than to make the effort not to comply.

C. Do Nudges Work?

Priming and nudging tactics are increasingly common.

Use Chapter Objective 7-4 Here Use Key Terms context effects, framing, prospect theory, sunk-cost fallacy, priming, nudge, urgency nudge, and default bias Here Use Review Questions 7-4, 7-5, 7-12, 7-14, 7-18, 7-19, and 7-20 Use Consumer Behavior Challenges 7-27 and 7-31 Here

V.

Online Decision Making

What’s the most common way for us to conduct information search today? Google it.

Although there are other search engines out there, Google’s version of the software that examines the web is dominant.

A. SEO Search engine optimization (SEO) refers to the procedures companies use to design the content of websites and posts to maximize the likelihood that their content will show up when someone searches for a relevant term.

B. The Power of Customer Reviews Many of us rely on online reviews to steer us toward and away from specific restaurants, hotels, movies, garments, music, and just about everything else.

Online user ratings are the second-most trusted source of brand information according to a survey across 56 countries.

C. How Accurate Are Customer Reviews When we check out online reviews of a product and they’re all glowing, we tend to be a bit suspicious. It’s more effective for a review to include some negative reviews. Researchers recently documented what they call the binary bias. People tend to easily distinguish between positive ratings and negative ratings, but they are not sensitive to distinctions between more extreme and less extreme. As a result, when we see several reviews that are aggregated, we pay more attention to the proportion of positive to negative reviews, rather than the distribution of different review values.

D. The Long Tail .

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The business model known as the long tail is based on the concept that we no longer need to rely solely on big to find profits. Companies can make money if they sell small amounts of items that only a few people want—if they sell enough different items.

E. Cybermediaries A cybermediary is a website or app that helps to filter and organize online market information so that customers can identify and evaluate alternatives more efficiently (Pricegrabber.com is an example).

Directories and portals (such as Yahoo!) are general services that tie together a large variety of different sites. Forums, fan clubs, and user groups offer productrelated discussions to help customers sift through options. Intelligent agents are software programs that use collaborative filtering technologies to learn from past user behavior to recommend new purchases.

Our homes are the last frontier for digital selling assistants like Amazon’s Alexa or Google’s Home.

Service robots assist humans with various tasks. The more effective ones exhibit such traits as intelligence, likability, safety, and social skills.

Some companies use AI applications to upsell, or encourage customers to buy additional items, due to the suggestions made.

Use Chapter Objective 7-5 Here Use Key Terms search engines, search engine optimization (SEO), binary bias, long tail, cybermediary, intelligent agents, service robots, and upsell Here Use Consumer Behavior Challenges 7-15, 6-16, 7-17, 7-21, and 7-29 Here

End-of-Chapter Support Material

REVIEW 7-1.

Why can “mindless” decision making actually be more efficient than devoting a lot of thought to what we buy?

Sometimes the decision-making process is almost automatic; we seem to make snap judgments based on very little information. At other times, coming to a purchase decision begins to resemble a full-time job. A person may literally spend days or weeks thinking about an important purchase such as a new home, even to the point of obsession.

Mindless decision-making is more efficient because we do not waste time seeking .

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information when the decision is not as important, or we have previously made the decision. (5 minutes, Chapter Objective 7-3, AACSB: Reflective Thinking) 7-2.

List the steps in the model of cognitive decision making.

Problem recognition, information search, evaluation of alternatives, product choice, and outcomes. (5 minutes, Chapter Objective 7-2, AACSB: Reflective Thinking) 7-3.

Name two ways in which a consumer problem arises.

1) A person’s standard of comparison may be altered, 2) the quality of the consumer’s actual state can move downward, and 3) the consumer’s ideal state can move upward. (3 minutes, Chapter Objective 7-2, AACSB: Application of Knowledge) 7-4.

Give an example of the sunk-cost fallacy.

Simply put, the sunk-cost fallacy occurs when someone has paid for something and is therefore reluctant to waste it. When someone attends a sporting event even though weather may put him or her at personal risk is an example. (5 minutes, Chapter Objective 7-4, AACSB: Application of Knowledge) 7-5.

What is prospect theory? Does it support the argument that we are rational decision makers?

Prospect theory, a descriptive model of how people make choices, finds that utility is a function of gains and losses, and risk differs when the consumer faces options involving gains versus those involving losses. Losses are perceived as more important than gains.

This says that the factors of decision-making are relative. That would imply that we are not rational. (5 minutes, Chapter Objective 7-4, AACSB: Reflective Thinking) 7-6.

“Marketers need to be extra sure their product works as promised when the first introduce it.”

How does this statement relate to what we know about consumers’ evoked sets?

People are more likely to add a new brand to the evoked set than one that we previously considered but passed over, even after additional positive information has been provided for that brand. For marketers, consumers’ unwillingness to give a rejected product a second chance underscores the importance of ensuring that it performs well from the time it is introduced. (5 minutes, Chapter Objective 7-2, AACSB: Reflective Thinking)

7-7.

List three product attributes that consumers can use as product quality signals and provide an example of each.

1) Price: Consumers commonly associate a higher price as an indicator of a higher level of quality. 2) Country-of-origin: A common U.S. perception is that watches that are made in Switzerland are of a higher quality than watches made in any other country. 3) Brand name: Some brands have developed an image of quality (i.e., Mercedes Benz, Toyota, .

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etc.) more so than others (i.e., Kia). (10 minutes, Chapter Objective 7-3, AACSB: Application of Knowledge) 7-8.

How does a brand name work as a heuristic?

Branding is a marketing strategy that often functions, as a heuristic because people assume top brands can be trusted. People form preferences for a favorite brand, and then they literally may never change their minds in the course of a lifetime. (5 minutes, Chapter Objective 7-3, AACSB: Reflective Thinking) 7-9.

Describe the difference between inertia and brand loyalty.

Inertia exists when we buy a brand out of habit merely because it requires less effort. For brand loyalty to exist, a pattern of repeat purchases must be accompanied by an underlying positive attitude toward the brand. The underlying attitude makes the consumer less likely to switch in response to a promotion than if they simply behaved based on inertia. (5 minutes, Chapter Objective 7-3, AACSB: Reflective Thinking) 7-10.

What is the difference between a noncompensatory and a compensatory decision rule? Give one example of each.

Noncompensatory decision rules are choice shortcuts where a product with a low standing on one attribute cannot make up for this position by being better on another attribute. Unlike noncompensatory decision rules, compensatory decision rules give a product a chance to make up for its shortcomings. Consumers who employ these rules tend to be more involved in the purchase and thus are willing to exert the effort to consider the entire picture in a more exacting way. The willingness to let good and bad product qualities balance out can result in quite different choices. (5 minutes, Chapter Objective 7-2, AACSB: Reflective Thinking) 7-11.

What is a prime? How does it differ from a nudge?

A prime is a stimulus that encourages people to focus on some specific aspect of their lives such as their financial well-being, or the environment. A nudge is a deliberate change by an organization that intends to modify behavior and can result in dramatic effects. (5 minutes, Chapter Objective 7-4, AACSB: Reflective Thinking) CONSUMER BEHAVIOR CHALLENGE DISCUSS 7-12.

Excessive food consumption may link to emotional issues such as feelings of inferiority or low self-esteem. In some situations, people consume products (especially food) as a reaction to prior life experiences such as the loss of a loved one or perhaps abuse as a child. A British man whom the U.K. news media once dubbed “the world’s fattest man” when he weighed in at 980 pounds is a case in point. He explained that as an adult his insatiable desire to constantly eat stemmed from an abusive father and sexual abuse by a .

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relative: “I still had all these things going around in my head from my childhood. Food replaced the love I didn’t get from my parents.” (The good news: after a gastric bypass operation this man has lost almost two-thirds of his body weight). Obviously, this is an extreme case, and it certainly doesn’t mean that everyone who struggles with his or her weight is a victim of abuse! Nonetheless, emotion often plays a role—a dieter may feel elated when he weighs in at three pounds less than last week; however, if he fails to make progress, he may become discouraged and actually sabotage himself with a Krispy Kreme binge. Is it ethical for food companies to exploit these issues by linking their products to enhanced moods?

Responses will vary based on the beliefs of students. Students should consider the cognitive, habitual, and effective aspects of consumer decision making. The feedback loop should be used to help with self-regulation. Implementation intentions should be discussed in terms of how they are exploited. (20 minutes, Chapter Objective 7-2, AACSB: Ethical understanding and reasoning) 7-13.

The chapter discusses ways that organizations can use “nudges” to change consumer behavior.

Critics refer to them as benevolent paternalism because they argue they force people to “eat their vegetables” by restricting the freedom to choose. For example, several cities including New York and Philadelphia have tried (unsuccessfully thus far) to ban the sales of extra-large portions of sugary drinks. What’s your take on these efforts – should local, state, or federal governments be in the business of nudging citizens to be healthier?

Responses will vary based on the beliefs of the students. Students should understand how much of the current work in behavioral economics demonstrates how a nudge—a deliberate change by an organization that intends to modify behavior—can result in dramatic effects. A simple “nudge” that changes how people act is to switch from asking consumers to “opt in” to a program to asking them to “opt out” of a program if they don’t want to participate. (20 minutes, Chapter Objective 7-4, AACSB: Ethical understanding and reasoning) 7-14.

Technology has the potential to make our lives easier as it reduces the amount of clutter we need to work through to access the information on the Internet that really interests us. However, perhaps intelligent agents that make recommendations based only on what we and others like us have chosen in the past limit us, in that they reduce the chance that we will stumble on something (e.g., a book on a topic we’ve never heard of or a music group that’s different from the style we usually listen to) through serendipity. Will the proliferation of “shopping bots” make our lives too predictable by only giving us more of the same? If so, is this a problem?

Responses will vary by student. Intelligent agents are sophisticated software programs that use collaborative filtering technologies to learn from past user behavior to recommend new purchases. When you let Amazon.com suggest a new book, the site uses an intelligent agent to propose novels based on what you and others like you have bought in the past. The biggest problem Web surfers face these days is to narrow down their choices, not to beef them up. In cyberspace, simplification is key. If we Google a term, most of us are only likely to look at the first few results at the top of the list.

Indeed, that’s one reason why search engine optimization (SEO) is so important today; this term refers to the procedures companies use to design the content of websites and .

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posts to maximize the likelihood that their content will show up when someone searches for a relevant term. Our goal is to persuade people to access our content. Just like an expert fisherman chooses his spot and carefully selects the right lure to catch a fish, SEO experts create online content that will attract the attention of the search algorithms, or mathematical formulas, that companies like Google use to determine which entries will turn up in a search. The algorithm will hunt for certain keywords, and it also will consider who uses them. (20 minutes, Chapter Objective 7-5, AACSB: Ethical understanding and reasoning) 7-15.

It’s increasingly clear that many postings on blogs and product review websites are fake or are posted there to manipulate consumers’ opinions. How big a problem is this if consumers increasingly look to consumer-generated product reviews during the stage of information search? What steps, if any, can marketers take to nip this problem in the bud?

Increasingly many of us rely on online reviews to steer us toward and away from specific restaurants, hotels, movies, garments, music, and just about everything else. A survey of 28,000 respondents in 56 countries reported that online user ratings are the second-most trusted source of brand information (after recommendations from family and friends). We usually put a lot of stock in what members of our social networks recommend.

Unfortunately, user ratings don’t link strongly to actual product quality that objective evaluation services like Consumer Reports provide. And there’s evidence that mobile reviews may be less helpful than desktop reviews, even when the same reviewer writes both. Comments posted via mobile devices are more emotional and more negative.

Regardless of their accuracy, customer product reviews are a key driver of satisfaction and loyalty. Another advantage these reviews provide is that consumers learn about other, less popular options they may like as well, and at the same time products such as movies, books, and CDs that aren’t “blockbusters” are more likely to sell. (20 minutes, Chapter Objective 7-5, AACSB: Ethical understanding and reasoning)

7-16.

For the same reasons that anthropomorphized digital assistants are influential, they are also worrisome. Recent research reveals that consumers are increasingly concerned artificial intelligence assistants are invading their privacy and threatening their human identity. Some even put Alexa back in her box so she can’t hear background conversations. Even if you’re not ready to give up on Alexa or Google Home, what steps (if any) do you think you should take to protect your data privacy?

Student responses will vary. Given that these digital assistants do more than turn on your lights or play your favorite music, some students will highlight their ability to be intrusive. Others will have less concern with protecting privacy and the level of that protection. (20 minutes, Chapter Objective 7-5, AACSB: Ethical understanding and reasoning)

7-17.

Research supports the argument that the way we pay for a product changes the way we perceive it. More specifically, credit cards prime people to focus less on the costs of the .

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item and more on the benefits. Using plastic decouples the expense of the purchase so we tend to buy more when we can charge it. Newer innovations like digital wallets take this a step further so payment— at least at the time of purchase—is even less painful. Are these formats going to create problems if they prime us to think more about short-term gratification and less about the long-term hit to our budgets? Do marketers have an obligation to try to prevent these problems?

Responses will vary by student but should consider the idea of priming consumers in the decision making process. Researchers who work on prospect theory analyze how the value of a decision depends on gains or losses; they identify principles of mental accounting that relate to the way we frame the question as well as external issues that shouldn’t influence our choices but do anyway. The notion that even subtle changes in a person’s environment can strongly influence the choices he or she makes has emerged on center stage in the study of consumer behavior in recent years. Unlike standard economic theory that regards people as rational decision makers, the rapidly growing field of behavioral economics focuses on the effects of psychological and social factors on the economic decisions we make, and many of these choices are anything but “rational.”

Indeed, it turns out that it’s quite possible to modify the choices of individuals and groups merely by tinkering with the way we present information to them. Much of the emerging work in behavioral economics focuses on the role of priming: Cues in the environment that make us more likely to react in a certain way even though we’re unaware of these influences. A prime is a stimulus that encourages people to focus on some specific aspect of their lives such as their financial well-being or the environment. (20 minutes, Chapter Objective 7-3 and 7-4, AACSB: Ethical Understanding and Reasoning) 7-18.

Country of origin can discourage sales in some situations, and in some cases, this is due to deeply held moral views. For example, some Jews refuse to buy cars made by Mercedes-Benz and other German automakers due to their use of slave labor to make vehicles during World War II. Should a company bear responsibility for decisions its predecessors made?

Student responses will vary significantly based upon their own individual beliefs and should make for engaging conversation. Ethnocentrisim refers to the belief that products from other places are inferior (or unwanted) when compared to local versions. Many factors can lead to this belief, with history being a very relevant one. (15 minutes, Chapter Objectives 7-3 and 7- 4, AACSB: Reflective Thinking and Ethical Understanding and Reasoning)

7-19.

If people are not always rational decision makers, is it worth the effort to study how they make purchasing decisions?

The decision-making steps presented in the chapter cover many situations, but common sense tells us we don’t undergo this elaborate sequence every time we buy something. If we did, we’d spend our entire lives making these decisions. Some of our buying behaviors simply don’t seem “rational” because they don’t serve a logical reason. Habitual decision making describes the choices we make with little or no conscious effort. Many .

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purchase decisions are so routine we may not realize we’ve made them. Although decisions we make on the basis of little conscious thought may seem dangerous or at best stupid, this process actually is quite efficient in many cases. As consumer researchers, studying these decisions to try and better understand the process may provide us with avenues by which to influence even those habitual decisions. (Chapter Objective 7-3; AACSB: Reflective Thinking) APPLY 7-20.

Find examples of electronic recommendation agents on the web. Evaluate these. Are they helpful? What characteristics of the sites you locate are likely to make you buy products you would not have bought on your own?

Amazon.com has intelligent agents. The students may have to spend a fair amount of time to come up with actual recommendation agents. Their responses to the second question are likely to vary and it may be unclear whether they would have come across the products via another source. (15 minutes, Chapter Objective 7-5, AACSB: Reflective Thinking)

7-21.

Sometimes a company actually invents a determinant attribute: Pepsi-Cola accomplished this when it stamped freshness dates on soda cans. It spent about $25 million on an advertising and promotional campaign to convince consumers that there’s nothing quite as horrible as a stale can of soda-even though people in the industry estimate that drinkers consume 98 percent of all cans well before this could be a problem. Six months after it introduced the campaign, lo and behold, an independent survey found that 61 percent of respondents felt that freshness dating is an important attribute for a soft drink. Devise a similar strategy for another product category by coming up with a completely new product attribute. How would you communicate this attribute to your customers?

In order for a marketer to effectively recommend a new decision criterion, its communication should convey three pieces of information: 1. It should point out that there are significant differences among brands on the attribute.

2. It should supply the consumer with a decision-making rule, such as if (deciding among competing brands), then . . . (use the attribute as a criterion). It should convey a rule that can be easily integrated with how the person has made this decision in the past. Otherwise, the recommendation is likely to be ignored because it requires too much mental work.

3. These things should be applied to coming up with a new attribute and communicating it to the target market. (15 minutes, Chapter Objective 7-2, AACSB: Reflective Thinking)

7-22.

Choose someone you know who grocery shops on a regular basis and keep a log of their purchases of common consumer products during the term. Can you detect any evidence of brand loyalty in any categories based on consistency of purchases? If so, talk to the

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person about these purchases. Try to determine if their choices are based on true brand loyalty or on inertia. What techniques might you use to differentiate between the two?

To begin with, the instructor should ask the students to differentiate between brand loyalty and inertia. Brand loyalty is represented by a pattern of repeat product purchases, accompanied by an underlying positive attitude toward the brand. Inertia describes consumption at the low end of involvement, where decisions are made out of habit because the consumer lacks the motivation to consider alternatives.

For example, a student said that her mother buys the same cereal every week. In discussing the reason for buying the cereal, her mother said she bought it because it was what the student’s father liked. She considered him to be brand loyal. Techniques the student could use to find out if the father were truly brand loyal would be to ask him to try other cereals. After trying these alternatives, if he insisted that his was the best, he could be considered to be brand loyal. (Possible Field Project Idea) (45 minutes, Chapter Objective 7-3, AACSB: Reflective Thinking) 7-23.

Hershey’s stresses the determinant attribute of product authenticity when the chocolate company states: “Hershey, PA is where it all started more than 100 years ago, and it’s still where the famous Hershey’s Kisses are made”. Find examples of other companies that appeal to their heritage. How effective are these messages?

Student responses will vary some may include Coors, Sam Adams, Smucker’s, JohnsonJohnson, and Disney. (20 minutes, Chapter Objective 7-2, AACSB: Reflective Thinking)

7-24.

Form a group of three. Pick a product and develop a marketing plan based on either cognitive or habitual decision making. What are the major differences in emphasis between the two perspectives? Which is the most likely type of decision-making process for the product you selected?

Answers will vary.

(20 minutes, Chapter Objective 7-2 and 7-3, AACSB: Reflective Thinking)

7-25.

Identify a person who is about to a major purchase. Ask that person to make a chronological list of all the information sources he or she consults before deciding what to buy. How would you characterize the types of sources he or she uses (i.e., internal versus external, media versus personal, etc.)? Which sources appeared to have the most impact on the person’s decision?

Student responses will vary. Several issues may be considered including bounded rationality and brand loyalty issues. How consumers process information in the decision making process should be considered, as well as their role within the family and that decision making unit. (20 minutes, Chapter Objective 7-2, AACSB: Reflective Thinking

7-26.

Perform a survey of country of origin stereotypes. Compile a list of five countries and ask people what products they associate with each. What are their evaluations of the products .

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and likely attributes of these different products? The power of a country stereotype can also be demonstrated in another way. Prepare a brief description of a product, including a list of features, and ask people to rate it in terms of quality, likelihood of purchase, and so on. Make several versions of the description, varying only the country from which it comes. Do ratings change as a function of the country of origin?

Students may have strong associations for many countries tied to specific products or product categories. Examples might include European import/luxury cars, French wines, Italian leather goods, Swedish crystal, and Japanese electronics. It may be interesting to expand the notion of country of origin and ask students to talk about areas in the United States that are particularly well known for specific products. Alternatively, for both country and region of origin, students should be challenged to think of examples that represent weak or poor association that marketers would want to avoid. (Possible Field Project Idea) (60 minutes, Chapter Objectives 7-3 and 7-4, AACSB: Reflective Thinking) 7-27.

Ask a friend to “talk through” the process he or she used to choose one brand over others during a recent purchase. Based on this description, can you identify the decision rule that was most likely employed?

The instructor might begin by reviewing the two types of decision rules, namely, compensatory and non-compensatory. Compensatory decision rules involve averaging information about attributes of competing products where a poor rating on one attribute can be offset by a good rating on another. Non-compensatory decision rules, alternately, would find a brand with a low rating on one relevant/important attribute eliminated from the consumer’s choices, despite higher ratings on less relevant/important attributes. The specific types of compensatory and non-compensatory rules also should be reviewed. (20 minutes, Chapter Objective 7-2, AACSB: Analytical Thinking)

7-28.

Think of a product you recently shopped for online. Describe your search process. How did you become aware that you wanted or needed that product? How did you evaluate alternatives? Did you wind up buying online? Why or why not? What factors would make it more or less likely that you would buy something online versus in a traditional store?

Student responses will vary. (20 minutes, Chapter Objective 7-5, AACSB: Reflective Thinking)

7-29.

Can you replicate Chan’s decision-making process as he chose a TV brand for other consumers or other products? Create a grid for a different product category that lists available brands and the features each offers. (Hint: Product websites for computers, cars, and other complex products often generate these grids when they allow you to choose the “compare products” option.) Present this grid to several respondents and ask each to talk aloud as they evaluate their options. Based on their description, can you identify which decision rule they seem to use?

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Student answers will vary. Grids will likely have an indication of features, prices, and quality issues. Decisions may be based on cognitive, habitual, or affective processes.

There may be discussion about constructive processing, mental budgets, and self regulation. Students should consider emotion in the decision making process. (20 minutes, Chapter Objectives 7-1 and 7-2, AACSB: Reflective Thinking) 7-30.

Extraneous characteristics of the choice situation can influence our selections, even though they wouldn’t if we were totally rational decision makers. Create two versions of this scenario (alternate the text you see in parentheses as directed) and ask a separate group of people to respond to each: You are lying on the beach on a hot day. All you have to drink is ice water. For the past hour you have been thinking about how much you would enjoy a nice cold bottle of your favorite brand of beer. A companion gets up to go make a phone call and offers to bring back a beer from the only nearby place where beer is sold (either a fancy resort hotel or a small, run-down grocery store, depending on the version you’re given). He says that the beer might be expensive and so asks how much you are willing to pay for it. What price do you tell him?

When researchers gave both versions of this question to respondents, they found that the median price participants who read the fancy-resort version gave was $2.65, but those who got the grocery-store version were only willing to pay $1.50. In both versions, the consumption act is the same, the beer is the same, and they don’t consume any “atmosphere” because they drink the beer on the beach. How do these results compare to yours?

Student responses will vary based on who was interviewed. (30 minutes, Chapter Objective 7-4, AACSB: Application of Knowledge)

7-31.

Several products made in China (including toothpaste and toys) have been recalled because they are dangerous or even fatal to use. Some American consumers have stopped buying them as a result. Essentially these consumers use country of origin as a heuristic to avoid Chinese products. If the Chinese government hired you as a consultant to help it repair some of the damage to the reputation of products made there, what actions would you recommend?

Student responses will vary. It is important to keep in mind that country of origin (COO) is an important heuristic. However, we do sometimes witness consumer animosity toward a brand (or a country) due to intense negative publicity or dislike for the manufacturer (or country). (Chapter Objective 7-3, AACSB: Reflective Thinking)

CASE STUDY TEACHING NOTES Chapter 7 Case Study: P&G and the Moments of Truth – Just How Many Moments Are There?

Summary of Case .

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This case is about the evolution of the “Moments of Truth” concept made famous by P&G. The early view of these key points of interaction with the consumer were focused on reviewing options in a store and then using the product at home after purchase. Over the years, many other moments were proposed at both ends of the process to include evaluation of alternatives via web search and feedback following the user experience.

Suggestions for Presentation This case can be taught as part of the decision-making process. If used in class, consider discussing with students how they might make a decision for the purchase of one of the many P&G products (see us.pg.com).

Suggested Answers for Discussion Questions CS7-1. Focus upon each of the “moments of truth” in turn.What specific strategies could P&G employ in each one to increase the probability of a sale and repeat business?

Answers will vary depending on “moments” chosen. Many of the strategies will focus on effectively communicating with the consumers/customers through various means such as advertising, email, and social media.

(10 minutes, Chapter Objectives 2 & 5, AACSB: Application of Knowledge)

CS7-2. For a consumer purchasing a new car, which would be the first, second, and third most important moments in the process? Explain your prioritization.

All the moments are important, and cases could be made for more than one prioritization. One ranking (most important first) would be: 1. <ZMOT—This is the stimulus that causes a consumer to begin a search. It could be one of the many problems that consumers try to solve with a car, or it may be a reaction to advertising. This “starts the ball rolling.”

2. ZMOT— Many car shoppers (particularly younger ones) will start with internet research; if the brand fails at this moment, the consumer may take the brand off their list.

3. FMOT – It is worth discussing how FMOT is different in this context as most car “stores” will not have more than one brand. Nevertheless, the first trip to the dealer is still a critical point in the decision-making process.

(5 minutes, Chapter Objective 2, AACSB: Analytical Thinking) CS7-3. Do frameworks like the MOTs help marketers, or is this just “consultant-speak?” If you believe the approach helps, explain how.

Most of the MOTs had been previously considered important points in the consumer’s journey before the MOT idea was defined. However, the MOT idea allowed P&G CEO Lafley to emphasize their importance and to focus his marketing team on designing strategies to maximize impact at each MOT. While the expansion of the list of MOTs could dilute their effect, each new .

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proposed MOT reminds marketers that there are many critical steps in the process and each deserve some level of marketing attention.

(10 minutes, Chapter Objective 2, AACSB: Reflective Thinking)

MULTIPLE CHOICE QUESTIONS 1. P&G calls the step in the sales process when the customer provides feedback to the firm about their purchase __________. a. the third moment of truth b. closing the loop c. the feedback period d. the satisfaction moment e. the second moment of truth Correct response: a P&G calls the step in the sales process when the customer provides feedback to the firm about their purchase the third moment of truth. The first moment of truth occurs when the customer is looking at the product to determine whether to buy it and the second moment of truth occurs when the customer uses the product at home.

2. P&G dubbed the internet research that consumers do prior to purchasing a product __________. a. FMOT b. ZMOT c. SMOT d. TMOT e. AMOT Correct response: b ZMOT is an acronym for Zero Moment of Truth and it represents the internet research that consumers conduct prior to buying a product.

3. The Moments of Truth framework helped P&G understand the path from stimulus to purchase to brand loyalty is __________. a. constructive processing b. difficult to navigate for marketers c. a journey with several important steps d. an elimination-by-aspects rule e. counteractive construal Correct response: c The Moments of Truth framework helped P&G understand that the path from stimulus to purchase to brand loyalty is a journey with several important steps along the way. Marketers need to understand all these steps to ultimately shape consumer preferences and create brand loyalty.

4. P&G would like consumers to engage in __________ for its consumer products. .

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a. counteractive construal b. evaluative criteria c. prevention motivation d. habitual decision making e. social scoring Correct response: d Habitual decision making describes decisions we make with little or no conscious effort. P&G is the world’s largest consumer products manufacturer and it would like for consumers to develop a brand preference and automatically buy the firm’s products, such as soap or toothpaste, with little or no thought.

5. The Moments of Truth model shows that consumer adoption is __________. a. a complex process b. one point in time c. easy to manipulate d. easy to model e. focused on the initial sale Correct response: a The Moments of Truth model shows that consumer adoption is a complex process where the firm gets several opportunities to make an impression.

Additional Support Material STUDENT PROJECTS Individual Projects 1.

Have individual students evaluate a recent purchase of a large-scale item (e.g., expensive clothing, car, stereo system, appliance, furniture, etc.) based on the stages in the Consumer Decision Making Process. Ask them if they think they gathered enough information before making their decision. See if they were satisfied with the quantity or quality of the information they had at their disposal.

Students may make assumptions about why information was or was not available. (15 minutes, Chapter Objectives 7-1, 7-2, and 7-3, AACSB: Reflective Thinking)

2.

Have students choose a specific type of product. Then, have them find product-rating reports from Consumer Reports or a similar organization that tests products. The students should evaluate the rating system the organization used. What other information would have been useful?

Students should select a higher involvement product if they want the information to be available via Consumer Reports. Student evaluations of missing useful information will .

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depend on the product chosen. (20 minutes, Chapter Objectives 7-4 and 7-5, AACSB: Reflective Thinking) 3.

Ask a student to compile a description of three products that include both features and country of origin. Then have the student ask a few people to rate the quality of the products and whether they would probably buy them. See if he or she can find out why the respondents feel this way.

Some respondents may indicate that the country of origin is part of the issue, but many will not. Students may need to probe with specific questions about the country of origin.

In addition, responses will likely differ by age group. (45 minutes, Chapter Objective 7-4, AACSB: Reflective Thinking)

4.

It is often revealing when a student interviews a manager of a local retail store to determine how the store is attempting to meet the consumer’s need for information. After the interview, suggest that the student use powers of observation to determine how effective the approach seems to be.

Retail products with high margins may use salespeople to provide information. Other retailers may use shelf-talkers, kiosks, Q-codes, and websites. (30 minutes, Chapter Objective 7-4, AACSB: Reflective Thinking)

5.

Have a student identify countries-of-origin of popular U.S. cars. Find out how many cars that we identify as “American” are made in other countries and how many cars we identify as “foreign” are assembled in the United States. A variation on this would be to do the same with heavy equipment (such as John Deere) or with motorcycles or cars that are considered to be of Japanese origin.

Students may be surprised to learn about foreign brands that are assembled in the United States. In discussion, ask them if learning this changes their attitudes toward the brands.

(45 minutes, Chapter Objective 7-4, AACSB: Reflective thinking)

6.

What sources of information are most valuable to you when making a decision on purchasing (a) a computer, (b) an expensive piece of jewelry, (c) selecting a place to worship, and (d) something online? Explain.

Student responses may vary, particularly for d) something online, which is very vague.

Look for students to explain why they rely on those sources of information. (15 minutes, Chapter Objective 7-2, AACSB: Reflective Thinking)

7.

Have students keep a diary listing their highest and lowest involvement product purchases or service transactions for each day for a week. Have them identify the decision process they went through and how satisfied they were with their decision. Then have them write a short paper describing the lessons they learned from the purchases.

What mistakes were made?

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Students should be given enough time to reflect on the purchases so they have lessons they learned from the purchases available. Students should recognize the difference between the high involvement decisions, which likely included the steps in the extensive decision making process, and the low involvement decisions. (25 minutes, Chapter Objectives 7-2 and 7-3, AACSB: Reflective Thinking) 8.

Ask a student to bring to class an advertisement that is designed to activate the problemrecognition process. Does the student think that the ad works on the consumer’s actual state or ideal state? See if the student can improve the problem recognition features of the advertisement.

This exercise will help students differentiate between the actual and the ideal state. Look for students to provide support for why their suggestions improve the problem recognition features of the advertisement. (10 minutes, Chapter Objective 7-2, AACSB: Reflective Thinking)

Group Projects 1.

This project will require student groups to conduct consumer interviews. They should contact people (acquaintances, friends, etc.) and ask them questions about a recent purchase or consideration of a purchase. Specifically, they should ask the consumer what factors led them to problem recognition. They should also ask the respondents to explain the similarities or differences that existed between their choices at decision time.

Students should ask for specific stimuli that led to problem recognition and note if the problem was recognized because of a difference from the ideal state or a deterioration of the actual state. (120 minutes, Chapter Objectives 7-2, AACSB: Reflective Thinking)

2.

Student groups should consider the product category of gas/electric hybrid vehicles.

Based on the consumer decision-making process, they should design a strategy for a company selling this product. They should cover each stage of the decision-making model used in the chapter.

Students should include problem recognition, information search, evaluation of alternatives, purchase and post-purchase steps and design strategies that address consumer needs at each stage. (45 minutes, Chapter Objective 7-2, AACSB: Reflective Thinking)

ONLINE ASSIGNMENTS Individual Assignments 1.

Go to www.peapod.com. Online grocery is alive and well. Although most grocery purchases that we make fall into the category of habitual decision-making, somehow, this .

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concept is working for some people. Spend some time on this site and assemble a grocery order. What are the pros and cons of using an online service for habitual decision-making decisions?

Peapod.com and other grocery services allow you to recall your past grocery lists, which saves time and effort associated with choosing each product you want each time. This is particularly valuable for habitual purchases. Buying online reduces the likelihood of impulse purchases that may increase the overall grocery bill, but it also may reduce the likelihood that a consumer sees a good deal on a substitute product. (20 minutes, Chapter Objective 7-3, AACSB: Reflective Thinking)

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Chapter 8: Buying, Using, and Disposing

Chapter 8: BUYING, USING, AND DISPOSING

CHAPTER OBJECTIVES When students finish this chapter, students should be able to: 8- 1. Explain the factors that influence consumers’ shopping experience during each phase of the purchasing process.

8- 2. Describe how the virtualization of shopping increases our reliance on digital assets.

8- 3. Summarize how the growth of a “sharing economy” changes the way consumers think about using and owning.

8- 4. Explain how the climate change crisis requires us to think differently about buying, using, and disposing to limit our environmental footprint.

8- 5. Identify the maladaptive consumer behaviors that can occur in the purchasing and using phases.

CHAPTER SUMMARY Explain the factors that influence consumers’ shopping experience during each phase of the purchasing process.

Many factors affect a purchase. These include the consumer’s antecedent state (e.g., their mood, time pressure, or disposition toward shopping). Time is an important resource that often determines how much effort and search will go into a decision. Our moods are influenced by the degree of pleasure and arousal a store environment creates.

The shopping experience is a pivotal part of the purchase decision. In many cases, retailing is like theater: Consumers’ evaluation of stores and products may depend on the type of “performance” they witness. The actors (i.e., salespeople), the setting (i.e., the store environment), and the props (i.e., store displays) influence this evaluation. Several factors, such as perceived convenience, sophistication, and expertise of salespeople, determine store image, which you can think of as similar to a brand personality. With increasing competition from nonstore alternatives, it has never been more important for stores to create a positive shopping experience. Online shopping is becoming increasingly common, and this new way to acquire products has both good (e.g., convenience) and bad (e.g., security) aspects.

Describe how the virtualization of shopping increases our reliance on digital assets.

Mobile shopping apps on smartphones provide imaginative new ways for retailers to guide customers through the shopping experience: These apps can locate merchandise, identify the nearest restroom in a mall, or scout out sales. Virtual currencies encourage consumers to switch from cash and credit cards to digital wallets, which are electronic devices that allow an individual to make e-commerce transactions. A lot of this activity is propelled by the spread of near-field communication (NFC) technology that allows devices near to one another (like a .

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smartphone and an NFC terminal in a store) to establish radio communication. In addition, P2P (peer-to-peer) payment systems, such as Google Pay Send, PayPal, and Venmo, empower ordinary citizens to transact business with one another. In today’s changing market that often values speed, flexibility, and convenience, consumption tends to be more liquid; it is (1) ephemeral, (2) access-based, and (3) dematerialized.

Summarize how the growth of a “sharing economy” changes the way consumers think about using and owning.

In the rapidly growing sharing economy, people rent what they need rather than buy it. New technologies make this process much easier, and online networks allow us to form bonds of trust with strangers. In addition, many consumers no longer place a premium on owning products and prefer to “borrow” them only for the specific times when they need them.

Explain how the climate change crisis requires us to think differently about buying, using, and disposing to limit our environmental footprint.

Today more than ever, product disposal is an important element of consumer behavior. Waste from unused food, textiles, electronics, and other products is clogging our landfills and polluting our oceans. Many consumers and organizations address these issues by encouraging various forms of recycling, where products are reused rather than discarded.

Identify the maladaptive consumer behaviors that can occur in the purchasing and using phases.

Maladaptive consumption refers to substance-related addictions, like alcohol, tobacco, or opioids, as well as behavioral problems like gambling, overeating, or overusing technology or social media. This dark side of consumer behavior is problematic from a health standpoint, as these behaviors are mentally and physically harmful. It is also problematic from an economic standpoint, as these behaviors are also financially costly, and from a social standpoint, as they can hurt your relationships with others. In recent years, addiction to technology and social media has increased, as well as hoarding, an addictive behavior where consumers feel compelled not to discard used items. Concern about the environment and waste makes the issue of product disposal key in many categories. In addition to understanding whether and how consumers recycle, newer recommerce models, such as swishing, are emerging that enable people to share more of their used goods with one another rather than disposing of them.

CHAPTER OUTLINE

I.

The Shopping Experience Figure 8.1 illustrates the main factors that affect our shopping experience before, during, and after the purchase occurs.

A. Shop ‘Til You Drop?

Shopping is how we acquire needed products and services, but social motives for shopping also are important. Shopping is an activity that we can perform for .

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either utilitarian or hedonic reasons – or both.

Consumers vary in terms of their shopping orientation, or general attitudes about shopping. These orientations vary depending on the product categories and store types we consider.

A key distinction in shopping motivations is shopping for purpose, which is the utilitarian function of shopping, versus shopping for fun, which is the hedonic function.

Hedonic shopping motives includes the following: • Gratification seeking • Idea shopping • Adventure seeking • Social shopping • Role play • Value shopping The management perspective called design thinking is hot right now. It emphasizes the importance of creating products, services, and stores that aren’t just pretty. Instead, they have to make sense in terms of how customers actually live their lives and use these things.

The customer journey is the series of steps that occur before, during, and even after the shopping experience.

The consumer journey concept was influenced by the Japanese approach to total quality management. To help companies achieve more insight, researchers go to the gemba, which to the Japanese means “the one true source of information.”

B. Retailing as Theater Disney is revamping its stores to re-imagine the “magic” of the customer experience.

The quest to entertain means that many stores go all out to create imaginative environments that transport shoppers to fantasy worlds or provide other kinds of stimulation. We call this strategy retail theming.

Innovative merchants today use four basic kinds of theming techniques: •

Landscape themes rely on associations with images of nature, Earth, animals, and the physical body.

• Marketscape themes build on associations with manufactured places.

• Cyberspace themes build on images of information and communications technology.

• Mindscape themes draw on abstract ideas and concepts, introspection and fantasy, and often possess spiritual overtones.

One popular theming strategy is to convert a store into a being space, a space that resembles a living room. Many of these being spaces come and go rapidly – on purpose. Pop-up stores appear in many forms around the world.

C. Store Atmospherics Atmospherics are defined as the “conscious designing of space and its various dimensions to evoke certain effects in buyers.” These dimensions include colors, scents, and sounds. .

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To boost the entertainment value of shopping (and to lure online shoppers back to bricks-and-mortar stores), some retailers create activity stores that let consumers participate in the production of the products or services they buy there.

D. In-Store Decision Making Despite efforts to “pre-sell” consumers through advertising, marketers recognize that the store environment exerts a strong influence on many purchases.

When a shopper suddenly decides to buy something in the store, one of two different processes explains why: 1. The shopper engages in unplanned buying when they are unfamiliar with a store’s layout or perhaps, they are under some time pressure.

2. The shopper engages in impulse buying when they experience a sudden, irresistible urge.

Budget shoppers generally use mental computation strategies to keep track of their spending.

E. POP Goes the Retailer: Point-of-Purchase Stimuli A point-of-purchase (POP) stimuli can be an elaborate product display or demonstration, a coupon- dispensing machine, or an employee who gives out free samples of a new cookie in the grocery aisle.

F. The Salesperson: A Lead Role in the Play The salesperson is one of the most important players in the retailing drama.

A buyer–seller situation is like many other dyadic encounters (two-person groups); it’s a relationship in which both parties must reach some agreement about the roles of each participant during a process of identity negotiation.

The ability to be adaptable is vital when customers and salespeople have different interaction styles. We each vary in the degree of assertiveness we bring to interactions. At one extreme, nonassertive people believe it’s not socially acceptable to complain. Assertive people are more likely to stand up for themselves. Aggressives may resort to rudeness and threats.

The psychological dimension of time – how we experience it – is an important factor in queuing theory, the mathematical study of waiting lines.

G. Are You Satisfied?

Our overall reaction to a product after we’ve bought it goes by the name of consumer satisfaction/dissatisfaction (CS/D) Satisfaction or dissatisfaction is more than a reaction to how well a product or service performs.

According to the expectancy disconfirmation model, we form beliefs about product performance based on our prior experience with the product or communications about the product that imply a certain level of quality.

Contamination occurs when we see someone touch a product, or even get close to a product, that closeness spreads to the product and the product feels “dirty.”

Moral disgust describes how people react to what they view as unethical or socially unacceptable, a feeling that can literally make some people experience physical symptoms, like nausea.

H. Dissonance Dissonance theory can help explain why evaluations of a product tend to increase after we buy the product.

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Consumers actively seek support for their decisions so they can justify them.

Use Chapter Objective 8-1 Here Use Key Terms shopping orientation, hedonic, utilitarian, design thinking, customer journey, total quality management, gemba, retail theming, being space, pop-up stores, atmospherics, activity stores, unplanned buying, impulse buying, mental computation strategies, point-ofpurchase (POP) stimuli, dyadic encounters, identity negotiation, queuing theory, consumer satisfaction/dissatisfaction (CS/D), expectancy disconfirmation model, contamination, and moral disgust Here Use Review Questions 8-2, 8-4, and 8-5 Here Use Consumer Behavior Challenges 8-8, 8-9, 8-12, 8-13, 8-14, 8-15, 8-16, 8-17, 8-18, 8-19, 8-20, 8-21, 8-22, 8-23, and 8-24 Here

II.

E-Commerce and the Digital World A lot of our shopping experiences have moved online.

Industry analysts estimate a cart abandonment rate of about 70 percent as shoppers get frustrated and those online purchases just don’t happen.

A. From Bricks to Clicks The term showrooming means that a shopper visits a store like Best Buy to explore options for big-ticket items like TVs or appliances and then he or she finds a cheaper price for the specific model online.

B. Shopping Apps and In-Store Tech Mobile shopping apps on smartphones provide imaginative new ways for retailers to guide shoppers through the experience, as they do everything for you: locate merchandise, identify the nearest restroom in a mall, or scout out sales.

Some retailers deploy beacons in their stores. These devices communicate with smartphone apps indoors through a Bluetooth signal.

Augmented reality (AR) and virtual reality (VR) platforms promise to turn the shopping experience into an interactive playground.

C. Digital Currencies Digital wallets are electronic devices that allow an individual to make e-commerce transactions. A lot of this activity is propelled by the spread of near field communications (NFC) technology that allows devices near to one another (like a smartphone and an NFC terminal in a store) to establish radio communication. In addition, P2P (peer to peer) payment systems such as Google Pay Send, PayPal, and Venmo empower ordinary citizens to transact business with one another.

The Bitcoin system uses peer-to-peer technology to operate with no central authority or banks; it’s the most prominent form of cryptocurrency that relies upon an encryption technique called the blockchain rather than banks to regulate the generation of units of currency and verify the transfer of funds. .

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The marketing world is abuzz about the potential of NFTs (non-fungible tokens).

This is a digital certificate of ownership for a one-of-a-kind cryptographic asset that cannot be interchanged with another item.

D. Online Commerce: Raising the Bar The high-fashion site ModaOperandi bills itself as a pretailer; it provides exclusive styles by prodding manufacturers to produce runway pieces they wouldn’t otherwise make because store buyers weren’t sure anyone would pay the money for them.

Generally speaking, online shoppers value these aspects of a website: • The ability to click on an item to create a pop-up window with more details about the product.

• The ability to click on an item and add it to your cart without leaving the page you are on.

• The ability to “feel” merchandise through better imagery, more product descriptions, and details.

• The ability to enter all data related to your purchase on one page.

• The ability to mix and match product images on one page to determine whether they look good together.

E. Liquid Consumption In today’s changing market that often values speed, flexibility, and convenience, comsumption tends to be more liquid. Researchers define liquid consumption with three core attributes: 1. Ephemeral (They value those objects only in certain contexts and for limited lengths of time.)

2. Access-based (Liquid products are “accessed” rather than owned outright.)

3. Dematerialized (Liquid products use fewer or no materials in order to deliver their desired functionality.)

Use Chapter Objective 8-2 Here Use Key Terms cart abandonment rate, showrooming, mobile shopping apps, beacons, virtual reality, digital wallets, near field communications (NFC) technology, P2P (peer to peer) payment systems, cryptocurrency, blockchain, NFTs (non-fungible tokens, pretailer, and liquid consumption Here Use Review Questions 8-1 and 8-3 Here Use Consumer Behavior Challenges 8-10 and 8-18 Here

III.

New Ways to Have and Use: Ownership and the Sharing Economy We are witnessing the rise of the sharing economy, or what is sometimes called collaborative consumption. In this business model, people rent what they need rather than buy it.

Doing business with other consumers rather than with companies is known as P2P commerce (peer-to-peer). .

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A. The Thrill of Thrifting The secondary market, where people sell used goods, is growing exponentially.

Thrifting – where people supplement some of their purchases of brand-new products with items they find in these venues – is a popular activity for many.

Use Chapter Objective 8-3 Here Use Key Terms sharing economy, collaborative consumption, P2P commerce, secondary market, and thrifting Here Use Review Question 8-6 Here Use Consumer Behavior Challenge 8-11 Here

IV.

The Climate Crisis A. Product Disposal Product disposal is an important element of consumer behavior.

Because we form strong attachments to some products, it can be painful to get rid of them. Our possessions anchor our identities, our past lives on in our things.

B. The Crisis of Food Waste While millions of people suffer from food insecurity, many millions of pounds of food are avoidably wasted.

The “squander sequence” is the waste that occurs from how consumers use or misuse food products at the preacquisition/purchasing, acquisition, consumption, and disposition stages.

C. Recycling and the Underground Economy In lateral cycling, one consumer exchanges something he or she owns for something the other person owns.

Economic estimates of the underground economy (any economic activity that is not reported to government authorities and therefore is not taxed) range from 3 to 30 percent of the gross national product of the United States and up to 70 percent of the gross domestic product of other countries.

The new trend of recommerce shows that consumers want to squeeze more value out of their possessions by selling or trading them. This focus has given birth to the swishing movement, where people organize parties to exchange clothing or other personal possessions with others.

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Use Chapter Objective 8-4 Here Use Key Terms product disposal, “squander sequence”, lateral cycling, underground economy, recommerce, and swishing Here Use Review Question 8-4 Here

V.

The Dark Side of Buying and Using Maladaptive consumption refers to substance-related addictions as well as behavioral problems like gambling, overeating, or overusing technology or social media. This dark side of consumer behavior is problematic from a health standpoint and from an economic standpoint.

A. Addictive and Compulsive Behavior Some consumers take the expression “born to shop” quite literally. They shop because they are compelled to do so rather than because shopping is a pleasurable or functional task. Compulsive shopping refers to repetitive and often excessive shopping performed as an antidote to tension, anxiety, depression, or boredom.

B. Gambling Gambling is an example of a consumption addiction that touches every segment of consumer society.

C. Hoarding Hoarding is the acquisition of possessions without disposing of them.

D. Tech and Social Media Addiction Internet addiction refers to the compulsive overuse of digital experiences to the detriment of the individual.

The web design industry even has a name for the practice of increasing user interfaces that are intentionally designed to trick or deceive the user: dark design.

Use Chapter Objective 8-5 Here Use Key Terms maladaptive consumption, compulsive shopping, hoarding, internet addition, and dark design Here

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End-of-Chapter Support Material

REVIEW 8-1.

What are the two dimensions that determine whether we will react positively or negatively to a purchase environment?

Pleasure—–a person can enjoy or not enjoy a situation and arousal—they can feel stimulated or not. (5 minutes, Chapter Objective 8-1, AACSB: Reflective Thinking, 8-2.

List three separate motivations for shopping and give an example of each.

Social experiences: The enjoyment of shopping with friends and families.

Idea shopping: The desire to keep up with trends and new fashions, to see new products and innovations.

Gratification seeking: Shopping for stress relief.

Value shopping: Some people pride themselves on being able to find the best bargains.

(15 minutes, Chapter Objective 8-1, AACSB: Reflective Thinking) 8-3.

What are some important pros and cons of e-commerce?

Numerous benefits and limitations of e-commerce are discussed for both the consumer and the marketer. (10 minutes, Chapter Objective 8-2, AACSB: Reflective Thinking,) 8-4.

List three factors that help to determine store image.

Color, scents, and sounds. (5 minutes, Chapter Objective 8-1, AACSB: Reflective Thinking) 8-5.

What is the difference between unplanned buying and impulse buying?

Unplanned buying may occur when a person is unfamiliar with a store’s layout or perhaps when under some time pressure; or, a person may be reminded to buy something by seeing it on a store shelf. In contrast, impulse buying occurs when the person experiences a sudden urge he cannot resist. (10 minutes, Chapter Objective 8-1, AACSB: Reflective Thinking) 8-6.

How do business models in the sharing economy differ from traditional purchase processes?

We’re witnessing the rise of the sharing economy, or what is sometimes called collaborative consumption. In this business model, people rent what they need rather than buy it. Collaborative consumption communities typically offer a website that allows individuals to list their services and a rating system that allows both buyers and sellers to rate their experiences. What is fueling this revolution? Primarily technology that dramatically lowers transaction costs, so that it’s much easier to share assets and track them across large numbers of people. Online payment systems make it easy to exchange .

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money. Social networks create communities and build trust among strangers who can access each other’s histories. Sellers can make money from assets they don’t use much; think about how many hours a typical owner actually uses an electric drill compared to how much it costs to buy one. (10 minutes, Chapter Objective 8-3, AACSB: Reflective Thinking)

8-7.

What is the difference between recycling and lateral cycling?

During lateral cycling, one consumer exchanges something he or she owns for something the other person owns. Reusing other people’s things is especially important in our throwaway society because, as one researcher put it, “there is no longer an ‘away’ to throw things to.” Although traditional marketers don’t pay much attention to used product sellers, factors such as concern about the environment, demands for quality, and cost and fashion consciousness make these “secondary” markets more important. In fact, economic estimates of this underground economy range from 3 to 30 percent of the gross national product of the United States and up to 70 percent of the gross domestic product of other countries. The new trend of recommerce (a play on the term e-commerce) shows that many consumers want to squeeze more value out of their possessions by selling or trading them. (10 minutes, Chapter Objective 8-4, AACSB: Reflective Thinking) CONSUMER BEHAVIOR CHALLENGE DISCUSS 8-8.

Are pop-up stores simply a fad, or are they a retailing concept that’s here to stay?

Given that there are so many strategies that have circulated through retailing, it is likely that nothing is “here to stay.” Students should be engaged in a discussion as to how long they think that this trend will last and possible reasons that it might end (no longer providing the benefits of promoting the new idea; stores so profitable that they remain open, etc.). (5 minutes, Chapter Objective 8-1, AACSB: Reflective Thinking)

8-9.

Think about exceptionally good and bad salespeople you have encountered as a shopper.

What qualities seem to differentiate them from others?

The instructor might ask students to recall the last time they went shopping. In the context of that shopping trip, students should describe the characteristics of the salespeople who assisted them. The instructor, or a member of the class, should generate a list of the most common traits mentioned and use the class discussion to profile both good and bad salespeople. The students also should be encouraged to consider the text discussion of source credibility, including such characteristics as similarity, attractiveness, expertise, trustworthiness, and likeability. (10 minutes, Chapter Objective 8-1, AACSB: Reflective Thinking)

8-10.

The chapter noted that as many as 70 percent of people who shop online abandon their carts before they get to the checkout page. What are the major “pain points” you’ve encountered when .

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you purchase online, and how might you reduce them or eliminate them altogether?

Students will likely provide a long list of “pain points” that primarily focus on speed and ease of website use. (10 minutes, Chapter Objective 8-2, AACSB: Reflective Thinking) 8-11.

Consumers who participate in the sharing economy seem willing to interact with total strangers.

Despite safety and privacy concerns, what is the long-term outlook for this change in the way we think about interacting with people whom we don’t know? How can businesses help to diminish worries some people may have about these practices?

Consumers no longer want to buy them. Instead we’re witnessing the rise of the sharing economy, or what is sometimes called collaborative consumption. In this business model people rent what they need rather than buying it. Collaborative consumption communities typically offer a website that allows individuals to list their services and a rating system that allows both buyers and sellers to rate their experiences. Technology that dramatically lowers transaction costs, so that it’s much easier to share assets and track them across large numbers of people. Online payment systems make it easy to exchange money. Social networks create communities and build trust among strangers who can access each other’s histories. (10 minutes, Chapter Objective 8-3, AACSB: Reflective Thinking) 8-12. Several men’s clothing retailers nationwide now provide free booze to their male clientele to encourage them to hang out in their stores. Is it ethical to encourage customers to get wasted before they shop?

This is an extension of what salons have been doing for some time for women. Student opinions will vary with students pointing out that it is up to the customers to choose how much to consume. Make the connection for students that offering such refreshments are a part of store image and atmospherics. (5 minutes, Chapter Objective 8-1, AACSB: Ethical Understanding and Reasoning) 8-12.

Some retailers work hard to cultivate a certain look or image, and they may even choose employees who fit this look. Abercrombie & Fitch, for example, seems to link itself to a cleancut, all-American image. At one point, a lawsuit claimed that Abercrombie & Fitch systematically “refuses to hire qualified minority applicants as brand representatives to work on the sales floor and discourages applications from minority applicants.” (Abercrombie replied that it has “zero tolerance for discrimination.”) We know the Hooters restaurant chain is known for its attractive female waitresses. Should a retailer have the right to recruit employees who are consistent with its image even if this means excluding certain types of people (e.g., non-Caucasians, men) from the sales floor? What are some positive and negative aspects of a policy that requires employees who interact with customers to wear a uniform?

Traditionally, the law has allowed for hiring people with a certain look or body type if it can be proven that this is a necessary component of the product or service. For example, airlines can refuse to hire flight personnel that exceed a weight and size limitation (or terminate them if they exceed the limitations after being hired) because there is limited space to work on the airplanes. Ethnic restaurants can choose to only hire people of that ethnicity. Modeling agencies and movie/TV production companies make hiring decisions .

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based almost exclusively on the way people look. However, for many chains such as Abercrombie & Fitch, it is difficult to justify this link. In addition, in a case such as this, they would be unwise to attempt such a link for reasons of public perception. Since this lawsuit, Abercrombie & Fitch has implemented personnel policies to ensure that this problem will be eliminated. Whether or not students feel retailers should have the right to exclude certain types of people will vary based on the student’s opinion. The discussion on the use of uniforms should include the role of identity negotiation. A uniform is a factor that helps to define a salesperson’s role in the organization. (15 minutes, Chapter Objective 8-1, AACSB: Reflective Thinking) 8-14. The store environment is heating up as more and more companies put their promotional dollars into point-of-purchase efforts. Some stores confront shoppers with videos at the checkout counter, computer monitors attached to their shopping carts, and ads stenciled on the floors. We are also increasingly exposed to ads in non-shopping environments. For example, a health club in New York was forced to remove TV monitors that showed advertising on the Health Club Media Networks, after exercisers claimed that the programming interfered with their workouts. Do you feel that these innovations are overly intrusive? At what point might shoppers rebel and demand some peace and quiet while they shop? Do you see any market potential in the future for stores that “countermarket” by promising a “hands-off” shopping environment?

Student opinion will vary based on their knowledge/experience and feelings/beliefs about place-based media. You might ask your students if they ever encounter this type of promotion and explore their reaction at the time of exposure. Students might also be asked to consider a more objective opinion, in light of what they have learned from this course. They should be challenged to view the advantages and disadvantages of these practices from the perspectives of both consumers and retailers. (20 minutes, Chapter Objective 8-1, AACSB: Reflective Thinking) 8-15. Courts often prohibit special-interest groups from distributing literature in shopping malls. Mall managements claim that these centers are private property. However, these groups argue that the mall is the modern-day version of the town square and as such is a public forum. Find some recent court cases involving this free-speech issue and examine the arguments pro and con. What is the status of the mall as a public forum? Do you agree with this concept?

This exercise will challenge the student to conduct primary and secondary research.

Encourage exploration of this issue with other students, faculty members, and consumer advocacy groups. A search should be conducted of published sources such as court cases and the Law Review. They might call the management office of a local mall for additional information. (30 minutes, Chapter Objective 8-1, AACSB: Reflective Thinking) 8-16. Marketers use “tricks” to minimize psychological waiting time. These techniques range from altering customers’ perceptions of a line’s length to providing distractions that divert attention from waiting. .

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One hotel chain received excessive complaints about the wait for elevators, so it installed mirrors near the elevator banks. People’s natural tendency to check their appearance reduced complaints, even though the actual waiting time was unchanged.

Airline passengers often complain about the wait to claim their baggage. In one airport, they would walk 1 minute from the plane to the baggage carousel and then wait 7 minutes for their luggage. When the airport changed the layout so that the walk to the carousel took 6 minutes and bags arrived 2 minutes after that, complaints disappeared.

Restaurant chains are scrambling to put the “fast” back into fast food, especially for drive-through lanes, which now account for 65 percent of revenues. In a study that ranked the speed of 25 fast-food chains, cars spent an average of 203.6 seconds from the menu board to departure. Wendy’s was clocked the fastest at 150.3 seconds. To speed things up and eliminate spills, McDonald’s created a salad that comes in a container to fit into car cup holders. Arby’s is working on a “high viscosity” version of its special sauce that’s less likely to spill. Burger King is testing see-through bags so customers can quickly check their orders before speeding off.

What are your waiting line “pain points?” How can companies change their processes to make these situations easier or more enjoyable for you?

The psychological dimension of time—how we actually experience it—is an important factor in queuing theory, the mathematical study of waiting lines. As we all know, our experience when we wait has a big effect on our evaluations of what we get at the end of the wait. Although we assume that something must be pretty good if we have to wait for it, the negative feelings that long waits arouse can quickly turn people off. Student discussions on their “pain points” will vary. (15 minutes, Chapter Objective 8-1, AACSB: Reflective Thinking) 8-17. People have more leisure time than ever. Why do they feel so rushed, and how can marketers address this problem?

Student responses will vary with some believing that the amount of leisure time has actually declined, not increased. There are many possible answers to this question including the fact that, even with increased leisure time, today’s consumers are being pulled in so many ways that it appears we have less time. (Chapter Objective 8-1, AACSB: Reflective Thinking) 8-18. Is the customer always right? Why or why not?

Of course, the consumer is not always right, but they do have a right to be wrong and be heard. (Chapter Objectives 8-1 and 8-2, AACSB: Reflective Thinking)

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APPLY 8-19. Conduct naturalistic observation at a local mall. Sit in a central location and observe the activities of mall employees and patrons. Keep a log of the nonretailing activity you observe (e.g., special performances, exhibits, socializing, etc.). Does this activity enhance or detract from business the mall conducts? As malls become more like high-tech game rooms, how valid is the criticism raised that shopping areas are only encouraging more loitering by teenagers who don’t spend a lot in stores and simply scare away other customers?

Students tend to like this exercise. Now that they have been exposed to a variety of consumer behavior constructs, they are likely to see things in the retail context that they did not notice before. They will probably notice a wide variety of non-retailing activities in the mall. Encourage your students to think about the advantages and disadvantages of these other activities from both the consumers’ and retailers’ points of view. Encourage students to develop a specific plan for dealing with teenage loitering that would work, be legal, and would not interfere with normal store and mall traffic. Students might interview mall officials or security officers to get their viewpoint about loitering.

(Possible Field Project Idea) (90 minutes, Chapter Objective 8-1, AACSB: Analytical Thinking) 8-20. Select three competing clothing stores in your area and conduct a store image study for them. Ask a group of consumers to rate each store on a set of attributes and plot these ratings on the same graph. Based on your findings, are there any areas of competitive advantage or disadvantage you could bring to the attention of store management?

Students should review the section on store image (including Atmospherics) before beginning this exercise. You might encourage the students to select stores that are very different from each other rather than “direct competitors.” Consider using this as an opportunity to discuss the strengths and weaknesses of this type of market research.

(Possible Field Project Idea) (30 minutes, Chapter Objective 8-1, AACSB: Analytical Thinking) 8-21. Create a customer journey map by recording in precise detail each step you personally took when you interacted with a physical store or an e-commerce website. What are the potential “pain points” in this journey that might interface with a successful transaction?

You might want to ask different groups of students to construct a customer journey map for different types of products, such as convenience versus specialty goods. Tell students to look up these terms in the glossary and index for further information. (Possible Field Project or In-Class Group Project Idea) (25 minutes, Chapter Objectives 8-1 and 8-2, AACSB: Reflective Thinking) 8-22. Many retailers believe that when they pile a lot of stuff around their store, this cluttered look encourages shoppers to hunt for items and eventually buy more. Dollar General recently raised the height of its shelves to more than six feet; JC Penney transformed .

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empty walls into jewelry and accessory displays; Old Navy added lanes lined with items like water bottles, candy, and lunchboxes. Best Buy is even testing the impact of filling aisles with bulky items like Segways and bicycles to compensate for the smaller space that thin TVs and smaller speakers take up. Walmart recently did an abrupt about-face: The company only recently remodeled its stores by eliminating the pallets of items it used to stack in the centers of aisles, and it reduced overall inventory by about 9 percent.

Customers loved the leaner, cleaner look. Only one problem: They bought less stuff. As a senior Walmart executive commented, “They loved the experience. They just bought less.

And that generally is not a good long-term strategy.” Now, Walmart is adding inventory back in and is once again piling stacks of merchandise in aisles. What is your take on these store-stocking strategies? Visit several “big-box” stores in your area, such as Walmart, Target, Best Buy, Costco, and so on. If possible, interview shoppers about their experiences. Do they have trouble navigating around the store? Do they enjoy the clutter?

Does it feel like a “treasure hunt” when they have to pick their way around piles and pallets? If you were designing a store, how would you craft a stocking strategy that would make it easy to shop there?

A variety of responses will emerge from this activity because students may have different motivations for shopping and may have different experiences within the store depending on the shopper density when they shop. Students should recognize the trade-off between the convenience of making things neat, orderly and easy to find and the messy, cluttered store with things stacked high, which customers associate with lower prices. (30 minutes, Chapter Objective 8-1, AACSB: Reflective Thinking) 8-23. Identify three people who own electric coffeemakers. Then, “go to the gemba” by observing them as they actually prepare coffee in the appliance at home. Based on these experiences, what recommendations might you make to the designer of a new coffee maker model that would improve customers’ experiences with the product?

Student responses will vary. (30 minutes, Chapter Objective 8-1, AACSB: Reflective Thinking) 8-24. Interview three consumers who have used a sharing economy service, such as Zipcar, Airbnb, Snapgoods, and others. How would you characterize their experiences compare with more traditional models?

Student responses will vary. (30 minutes, Chapter Objective 8-3, AACSB: Reflective Thinking) 8-25

The chapter emphasizes the importance of design thinking to create products that are Easy and fun for people to use. Find an example of a product you own that is not userfriendly. How might you redesign it?

Student responses will vary. (30 minutes, Chapter Objective 8-1, AACSB: Reflective Thinking)

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Even subtle labelling and packaging cues can make us more or less likely to throw away a partially consumed product. Recent research shows that changing the visual features of a product’s packaging can help cut back (or encourage) waste. Researchers studied whether consumers were more likely to hold on to and finish disposable water bottles based on the placement of the bottle’s label. When labels were placed higher on a water bottle, consumers held onto them because the bottles appeared less empty. In contrast, when labels were placed lower on a water bottle, consumers were more likely to throw them away or leave them behind because the bottle seemed emptier. Can you replicate this finding with a group of friends?

Students will likely find this an interesting hands-on activity. (30 minutes, Chapter Objective 8-4, AACSB: Application of Knowledge)

CASE STUDY TEACHING NOTES Chapter 8 Case Study: RH — Revolutionizing Physical Retailing Summary of Case RH (formerly Restoration Hardware) is a luxury brand that offers lighting, décor, home furnishings, bathware, and a variety of other products clearly targeted to an upper income clientele. At one of their 83 galleries, you can buy everything from toys to a crystal chandelier for $51,425. In recent years, RH has decreased its total number of stores, but “doubled down” on the remaining ones by renovating them into big, beautiful galleries located in renovated historical buildings. These 45,000 square foot stores include cafés and offer childcare.

RH has a different view of its retail spaces—not as stores, but rather as galleries or showrooms, where customers can get inspiration and style guidance. One retail consultant calls these new RH showrooms a kind of “giant 3D real-time catalog”. RH is moving into new formats, including guesthouses, private jets, and vintage yachts available to rent.

Suggestions for Presentation Have students discuss other businesses that use retailtainment or other physical/ambiance kinds of strategies to keep customers coming in.

Suggested Answers for Discussion Questions .

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CS 8-1. In this chapter, you learned about some retailers that convert their whole store into a “being space.” How does this concept apply to the RH strategy and how might it affect its sales?

From the chapter: One popular theming strategy is to convert a store into a being space. This kind of environment resembles a sort of commercial living room, where we can go to relax, be entertained, hang out with friends, escape the everyday, or even learn. When you think of being spaces, Starbucks probably comes to mind. The coffee chain’s stated goal is to become our “third place” where we spend the bulk of our time, in addition to home and work. Starbucks led the way when it outfitted its stores with comfy chairs and Wi-Fi. RH’s cafés could serve as a being space, allowing customers to relax with friends while being exposed to (and in some cases “trying out”) RH products. These kinds of spaces encourage customers to spend more time with the brand and to do so in a relaxed and enjoyable setting that might put them more in the mood to buy RH products.

(10 minutes, Chapter Objective 1, AACSB: Reflective Thinking) CS 8-2. In this chapter, you learned that context effects and more specifically, atmospherics can affect consumers’ behavior in a store. Look over some of RH’s lavish galleries at rh.com/galleries. How might the gallery atmospherics lead to more purchases of RH products and services?

The high-end settings found at the galleries may encourage aspirational purchases—buying products that typify a level of financial success that the customer has yet to, but wants to, achieve. Customers who have positive social experiences in the RH restaurants or bars may associate those positive feelings with the atmosphere that the RH products help enable (e.g., furniture, rugs, paintings, and décor).

(10 minutes, Chapter Objective 1, AACSB: Analytic Thinking) CS 8-3. What elements of RH’s approach could be appropriate for retailers that are at price levels below the high/end prestige level of a retailer such as RH? Even value-priced retailers can create an atmosphere designed to draw customers into their stores. For example, Walmart could create a small hunting enthusiast section that tries to mimic the kind of environment that retail chain Bass Pro Shops has created. Students should be able to come up with other ideas that their favorite retailers could try.

(15 minutes, Chapter Objective 1, AACSB: Analytic Thinking)

MULTIPLE CHOICE QUESTIONS 1. RH’s retail strategy is designed to __________. .

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a. get people into physical stores b. increase online sales c. increase the number of brick-and-mortar stores d. focus on high-turnover low-margin items e. offer low-end merchandise that sell quickly Correct response: a RH’s retail strategy is designed to get people into physical stores. The company does this by offering engaging content that consumers can try out while they are in the store.

2. RH understands that a consumption decision can be influenced by the way a product looks but also by how customers might use the product. This perspective is known as __________. a. touchpoint marketing b. the purchase environment c. design thinking d. TQM e. Gemba Correct response: c RH understands that a consumption decision can be influenced by the way a product looks but also by how customers might use the product. This perspective is known as design thinking. For this reason, the stores are set up in a way that customers can try the products and see how they would look in their homes.

3. Retailers like RH create shopping themes that resemble a commercial living room where people can go to hang out and relax. This type of strategy converts the physical store into a __________. a. pop-up store b. being space c. pure play business d. showrooming experience e. shopping orientation experience Correct response: b Retailers like RH create shopping themes that resemble a commercial living room where people can go to hang out and relax. This type of strategy converts the physical store into a being space.

4. RH consciously designs its retail spaces to evoke certain effects that will impact the potential buyers. This practice is called __________. a. atmospherics b. showrooming c. theming d. an interactive style e. a dyadic encounter Correct response: a RH consciously designs its retail spaces to evoke certain effects that will impact the potential buyers. This practice is called atmospherics. Outdoor retailer Bass Pro Shops also uses this strategy by creating landscaped outdoor-themed displays inside its stores. .

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5. RH’s products would be classified as __________. a. recycled goods b. beacons c. luxury goods d. discount goods e. situational self-image products Correct response: c RH’s products would be classified as luxury goods. The store sells very high-end home furnishings, home decor, bathware, lighting, and other home products.

Additional Support Material STUDENT PROJECTS Individual Projects 1.

Have students go to a shopping mall. Have them analyze the behavior of shoppers based on observation only. Can they determine the nature of people’s reasons for shopping?

Have them keep track and present the results to the class.

Students may observe the pace at which the consumers are shopping, the number and types of purchases they have made from shopping bags, the number of people in the shopping group, the gender composition of the group, and the time of day, among other things, and make inferences about the shopper’s motivations. (90 minutes, Chapter Objective 18-1, AACSB: Reflective Thinking)

2.

Ask a student to visit competing discount houses, supermarkets, department stores, or specialty shops in your area and describe the image they have of each store. What factors account for the image differences? For the poorest image store, design a strategy for upgrading its image.

Student responses will vary depending on the stores visited, but they should recognize that there is often a cost associated with atmospherics. Therefore, stores with a higher image may also have higher margins on the products they sell. At the same time, some .

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stores may try to look bare bones and cluttered because consumers associated these store designs with lower prices. (120 minutes, Chapter Objective 8-1, AACSB: Reflective Thinking) 3.

Have students talk to other students at the university or college. What forms of complaint behavior do they observe? What strategies could the university or college follow to alleviate these complaints?

Students may enjoy this project. Student-to-student complaint interactions would be categorized as word of mouth. If the student complained to a third party or directly to the university, their complaints would fit in different categories. The strategies to alleviate complaints may be directed at the student or at the problem. (60 minutes, Chapter Objective 8-1, AACSB: Reflective Thinking)

4.

Have someone visit a local supermarket and question the manager regarding how shelf space is allocated. What and who determines which products are placed on the shelves, how much space they are allocated, and at what level they are displayed on the shelf?

Students may be surprised at the amount of thought that goes into shelf positioning.

Students who find it interesting may also want to read Paco Underhill’s book, Why We Buy: The Science of Shopping. (45 minutes, Chapter Objective 8-1, AACSB: Reflective Thinking)

5.

Many consumers have become more interested in conserving than in “throwing away.”

Have students think of ideas they have for creative recycling. Then, see if they can figure out ways to profitably market these ideas to the public.

Some organizations provide rewards to consumers that recycle (e.g. recyclebank.com).

Organizations like ebay.com, craigslist.org and freecycle.org help consumers recycle.

People who run flea markets make money by renting space to people who often want to sell used merchandise. Students might also sell extended warranties or service plans on second-hand products. (20 minutes, Chapter Objective 8-4, AACSB: Reflective Thinking)

6.

Ask a student to relate to the class a purchase experience in which dissatisfaction resulted from the product or service purchased. Have the student tell the class how they reacted in terms of post-purchase dissonance. How could the seller avoid future similar incidents?

Post-purchase dissonance is a result of tension that often occurs because of a difference between expectations and reality. The student should recognize that lowering expectations or improving service is two ways of reducing the gap between expected and actual service. (30 minutes, Chapter Objective 8-1, AACSB: Reflective Thinking and Written and Oral Communication)

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7.

Freecycle something. Then, take something off of Freecycle.org. Report on the experience including the feelings of giving/receiving, the benefit or value to the giver/receiver, etc.

Individual feelings will vary; the value should include the value of the object and the reduced cost to the environment. (30 minutes, Chapter Objective 8-4, AACSB: Reflective Thinking and Written and Oral Communication)

8.

Have each student think of a time when they had to get rid of something that had been significant to them. Analyze this situation in terms of divestment rituals.

Divestment rituals include iconic transfer ritual (taking pictures and videos before disposal), transition-place ritual (putting items away in a garage before disposal); and ritual cleansing (washing, ironing, and wrapping the item before disposal). (15 minutes, Chapter Objective 8-3, AACSB: Reflective Thinking)

9.

Faculty often gets free textbooks from publishers in order to review and possibly prescribe them for their courses. Book buyers come by faculty offices to get books (sometimes, instructor copies), which are then “recycled” into the aftermarket. Is this activity ethical? Does this help keep the cost of books lower for students? Alternatively, should the faculty freecycle these books by offering them to needy students?

Many schools have policies against selling text books to book buyers. The costs for some students may be lower, but the publisher probably has revenue goals so it is likely to increase the costs for other students. Faculty members can put unused copies on reserve at the library; this provides the benefit of sharing the content with needy students without profiting from something that was a goodwill gift from the publisher, which may ultimately increase prices for other students. (30 minutes, Chapter Objective 8-4, AACSB: Ethical Understanding and Reasoning)

Group Projects 1.

In groups, visit three or four different grocery stores, note the elements of the stores’ environment, and compare them. Based on what you have seen, make recommendations to the store manager in order to improve the retailing environment.

Look for students to select specific aspects of the store environment to improve and to tie their recommendations to the store’s overall positioning. (90 minutes, Chapter Objective 8-1, AACSB: Reflective Thinking)

2.

Student teams should go to an activity store to interview the manager. Given that the concept of the store is built around participating in the production of a good, ask the manager what benefits they perceive in this model, both from the consumer perspective and from the company perspective.

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Before assigning this exercise, make sure there is an activity store nearby that is willing to participate in the interview process. If there is only one activity store, you may want to select a single group to do this project so the manager is not overwhelmed with inquiries.

As an alternative, you can ask students to explore the websites of activity stores online to find the same information. Publicly traded stores will have information about the company perspective in their annual reports, and the consumer perspective should be evident from the copy on the website, which is likely to explain the value of the shopping experience to the consumer. (60 minutes, Chapter Objective 8-1, AACSB: Reflective Thinking) 3.

Assign each student group a competitive task. Each member of the group should attempt to get an item off Freecycle.org. The competition is: Which member of the group can come up with a free item that is worth the most? Which did the most good for the giver?

Which did the most good in terms of keeping it out of a landfill?

The value of the free item in total dollars should be compared to the value of keeping the product out of a landfill. (30 minutes, Chapter Objective 8-4, AACSB: Reflective Thinking)

4.

Have groups of students research and catalog recycling/reusing efforts in their community as part of the class project. They can think of this assignment as their contribution to public service. They can contact the local media to disseminate this information to the local public.

Look for students to focus on the positive dimension of existing efforts as well as the areas for improvement and to tie their recommendations back to what they learned in consumer behavior about product disposal. (30 minutes, Chapter Objective 8-4, AACSB: Reflective Thinking and Written and Oral Communication)

ONLINE ASSIGNMENTS Individual Assignments 1.

Go to www.bestbuy.com. The Best Buy website promises interactivity with the customer. What evidence do you find that this has occurred (if any)? Evaluate the Best Buy website as to ease of use and customer involvement. What are your impressions about the Best Buy approach? What is the company doing right and what are they doing wrong with respect to customer buying?

Students may note the ability to search, watch videos about “blue shirt test drives” of products, easy access to weekly promotional specials, the ability to compare products, etc. Look for students to provide support that relates back to the consumer behavior concepts in the chapter for what the company is doing right and what the company is

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doing wrong on the website. (15 minutes, Chapter Objective 8-2, AACSB: Reflective Thinking,) Group Assignments 1.

Go to www.bananarepublic.com and www.oldnavy.com. Have your group compare these two websites as to online atmosphere. Next, if possible, go to a Banana Republic and Old Navy store to determine the differences between in-store atmospheres. Comment on what you find. How have the two organizations positioned themselves? Is there consistency between the approaches used on the Web versus the approaches used in the retail environment? Explain. What improvements should one or both of the organizations make with respect to consumer buying? Explain how you arrived at your suggestion(s).

Both company websites are linked, as is gap.com and piperlime.com, and provides access to a common shopping bag. However, the designs of the websites are very different, as are the store images in the bricks and mortar versions of the store. Students should observe differences in the atmospherics, the salespeople, and the type and quantity of merchandise, and relate these differences to the positioning of the stores. For the recommendations, look for students to provide support for their suggestions from the chapter. (45 minutes, Chapter Objectives 8-1 and 8-2, AACSB: Reflective Thinking and Analytical Thinking)

2.

Go to www.customerssuck.com. As a group, examine accounts given by employees as to the outrageous behavior observed in retail settings. Summarize the findings. What conclusions can be made from this?

The examples on this website are a little bit dated, but can still be useful for students to categorize findings. Students may have examples from their own retail experiences. (20 minutes, Chapter Objective 8-5, AACSB: Reflective Thinking)

3.

Visit www.customerrespect.com/ and learn about what they do about treating online customers. Is this service necessary?

The service may provide online “listening” for companies that do not have the resources to perform this important responsibility in house. Student opinions will vary about whether the service is necessary, but should agree on the importance of designing websites to meet customer needs. (30 minutes, Chapter Objective 8-2, AACSB: Reflective Thinking)

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Chapter 9: Identity and the Self

Chapter 9: IDENTITY AND THE SELF

CHAPTER OBJECTIVES When students finish this chapter, students should be able to: 9- 1. Explain how the self-concept strongly influences consumer behavior.

9- 2. Describe how our consumption choices are expressions of our identities and extensions of our selves.

9- 3. Summarize how consumers are finding new ways to express identity via their consumption choices.

9- 4. Recognize the many sociocultural factors that contribute to gender identity.

9- 5. Discuss how our bodies are an important component of our identities.

CHAPTER SUMMARY Explain how the self-concept strongly influences consumer behavior.

Consumers’ self-concepts are reflections of their attitudes toward themselves. Whether these attitudes are positive or negative, they will help to guide many purchase decisions; we can use products to bolster self-esteem or to “reward” the self.

Describe how our consumption choices are expressions of our identities and extensions of our selves.

We choose many products because we think that they are like our personalities. The symbolic interactionist perspective on the self implies that each of us has many selves, and we require a different set of products as props to play each role. We view many things other than the body as part of who we are. People use valued objects, cars, homes, and even attachments to sports teams or national monuments to define the self when they incorporate these into the extended self.

Summarize how consumers are finding new ways to express identity via their consumption choices.

We often engage in impression management—a conscious effort to influence what others think about us. The brands we choose play an important part in that process. But consumers also rely upon the brand they choose to bolster their self-concepts, especially when some aspect of identity is threatened. In addition, many people now express identity via their digital selves, or the form they take when they interact in online environments.

Recognize the many sociocultural factors that contribute to gender identity.

Gender roles, or a society’s conceptions of masculinity and femininity, exert a powerful influence on our expectations about the brands we should consume. Advertising and products .

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that are sex-typed play an important role because they portray idealized expectations of gender identity. Definitions of gender are currently in flux as many people question whether the traditional male/female dichotomy applies to them.

Discuss how our bodies are an important component of our identities.

A person’s conception of their body also provides vital feedback to self-image. A culture communicates specific ideals of beauty, and consumers go to great lengths to attain these. Many consumer activities involve manipulating the body, whether through dieting, cosmetic surgery, piercing, or tattooing. Sometimes these activities are carried to an extreme because people try too hard to live up to cultural ideals. One common manifestation of this is eating disorders, where people become so obsessed with thinness that they engage in damaging eating behaviors, like anorexia or bulimia. Body decoration or mutilation may serve such functions as separating group members from nonmembers, marking the individual’s status or rank within a social organization or within a gender category, or even providing a sense of security or good luck.

CHAPTER OUTLINE

I.

The Self Are you what you buy?

A. Concept and Self-Esteem The self-concept summarizes the beliefs a person holds about their own attributes and how they evaluate the self on these qualities. The self-concept is a complex and malleable structure.

Each element that contributes to our self-concept is an identity.

Self-esteem refers to the positivity of a person’s self-concept. People with low self-esteem expect that they will not perform very well, and they will try to avoid embarrassment, failure, or rejection.

When a consumer compares some aspect of himself or herself to an ideal, this judgment influences self-esteem.

The ideal self is a person’s conception of how they would like to be, whereas the actual self refers to our more realistic appraisal of the qualities we do and don’t have. We choose some products because we think they are consistent with our actual self, whereas we buy others to help us reach an ideal standard.

Our avoidance self refers to the type of person we don’t want to be.

B. The Self and Others We also often engage in a process of impression management in which we work hard to “manage” what others think of us.

1. The Looking Glass Self Sociologists call the process of imagining others’ reactions “taking the role of the other,” or the looking-glass self.

“Who do other people think I am?” We tend to pattern our behavior on the perceived expectations of others, as a form of self-fulfilling prophecy. When we act the way we assume others expect us to act, we often confirm these .

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perceptions.

2. Social Comparison Exposure to ads may trigger a process of social comparison, in which the person tries to evaluate their appearance by comparing it to the people depicted in the advertising images.

3. Self- Construal Self-construal describes the degree to which we think of our self as independent from others versus feeling interdependent with them. People who grow up in Western cultures tend to focus on the independent self, thinking of themselves in terms of unique personal traits and attributes and de-emphasizing others, whereas people who grow up in Eastern cultures tend to focus on the interdependent self, defining their identities largely by their relationships with others.

4. Self-Consciousness A heightened concern about the nature of one’s public “image” results in more concern about the social appropriateness of products and consumption activities.

Consumers who score high on a scale of public self-consciousness express more interest in clothing and use more cosmetics than others who score lower.

High self-monitors are more attuned to how they present themselves in their social environments, and their estimates of how others will perceive their product choices influence what they choose to buy.

C. The Malleable Self In a way, each of us really is several different people. We have as many selves as we do different social roles.

A person may require a different set of products to play each of their roles.

1. Role Identities: Do You Know Your Lines?

The dramaturgical perspective on consumer behavior views people as actors who play different roles. We play many roles, and each has its own script, props, and costumes. The self has different components, or role identities, and only some of these are active at any given time.

Some roles may conflict with one another. In the torn self, individuals struggle with retaining an authentic culture while still enjoying Western freedoms.

How do we decide which self to “activate” at any point in time? The sociological tradition of symbolic interactionism stresses that relationships with other people play a large part to form the self.

2. Creating Our Self as We Consume Self-image congruence models suggest that we choose products when their attributes match some aspect of the self.

Consumers perceive customized products more positively because they allow more alignment with their self-image – known by researchers as self-imageconsistent product perceptions.

The choices we make in terms of what brands we buy, what we consume, or what we do are more valuable to us when they link to an identity we desire.

This process is called self-signaling; it’s a message to ourselves that our .

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choices sync with how we want to think about ourselves.

Congruence models assume a process of cognitive matching between product attributes and the consumer’s self-image.

We are attached to an object to the extent we rely on it to maintain our selfconcept.

Use Chapter Objective 9-1 Here Use Key Terms self concept, identity, self-esteem, ideal self, actual self, avoidance self, impression management, looking-glass self, self-fulfilling prophecy, social comparison, selfconstrual, independent self, interdependent self, public self-consciousness, self-monitors, dramaturgical perspective, role identities, torn self, symbolic interactionism, self-image congruence models, self-image-consistent product perceptions, and self-signaling Here Use Review Questions 9-1, 9-2, 9-4, and 9-5 Here Use Consumer Behavior Challenge 9-8 Here

II.

We Consume to Express Our Identities Consumers actively assemble consumption practices, products, and brands to express themselves as part of their identity projects: the active creation and communication of how a person defines and communicates their identity to the world.

A. The Extended Self Those external objects that we consider a part of us constitute the extended self.

The four levels of the extended self are (Figure 9.1): 1 Individual level—Consumers include many of their personal possessions in self-definition. These products can include jewelry, cars, clothing, and so on. The saying “You are what you wear” reflects the belief that one’s things are a part of one’s identity.

2 Family level—This part of the extended self includes a consumer’s residence and the furnishings in it. We can think of the house as a symbolic body for the family, and the place where we live often is a central aspect of who we are.

3 Community level—It is common for consumers to describe themselves in terms of the neighborhood or town from which they come. For farm families or other residents with close ties to a community, this sense of belonging is particularly important.

4 Group level—We regard our attachments to certain social groups as a part of the self; we’ll consider some of these consumer subcultures in later chapters. A consumer also may feel that landmarks, monuments, or sports teams are a part of the extended self.

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Use Chapter Objective 9-2 Here Use Key Term extended self Here Use Consumer Behavior Challenges 9-8, 9-19, 9-20, and 9-22 Here

III.

New Ways to Express Identity A. Compensatory Consumption Some people have a much clearer picture of their self-concept than do others.

They are very clear and confident about their identity. Researchers call this selfconcept clarity.

Compensatory consumption is a way for consumers to respond to threats to their self-esteem by consuming products that link to that aspect of the self-concept.

Symbolic self-completion theory suggests that people who have an incomplete self-definition tend to complete this identity when they acquire and display symbols they associate with that role.

B. Anti-Consumption as Self-Defining Some consumers may avoid brands they feel are too “corporate” to signal their desire for a more just world. Some anti-consumption acts, like boycotting or avoiding products are emancipating.

C. Embodied Cognition The concept of embodied cognition says that the states of the body modify states of the mind.

Our behavior and observations of what we do and buy shape our thoughts rather than vice versa.

Power posing – standing in a confident way even when you don’t feel confident – has been shown to affect brain activity.

The symbolism of certain clothes has been shown to impact how people behave.

This concept is known as enclothed cognition.

D. Our Digital Selves Our digital selves represent our identity in these online worlds, whether expressed via our social media profiles, Instagram photos, or by Bitmojis or avatars.

New virtual makeover technologies make it even easier for each of us to involve the digital self as we choose products to adorn our physical selves.

FOMO (fear of missing out) means that our constant exposure to social media accelerates this trend of being online.

Sexting is the posting of nude or seminude photos of themselves online.

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Section 2: Internal Influences on Consumer Behavior

Use Chapter Objective 9-3 Here Use Key Terms self-concept clarity, compensatory consumption, symbolic self-completion theory, anti-consumption, embodied cognition, power posing, enclothed cognition, digital selves, virtual makeover, FOMO (fear of missing out), and sexting Here Use Consumer Behavior Challenges 9-10, 9-12, 9-16, 9-18, and 9-20 Here

IV.

Gender and Consumer Behavior Whereas sex refers to a biological difference, gender identity is shaped by a variety of sociocultural factors. Gender is a culturally embedded, politically charged phenomenon as well as a biological label.

A. Gender Socialization and Gender Roles A culture’s expectations about how those of a gender should act, dress, or speak are referred to as gender roles.

Children pick up on the concept of gender roles at an earlier age than researchers previously believed.

Many commercial sources, such as Cinderella or Katniss dolls, provide lessons in gender socialization for both girls and boys.

There is still plenty of patriarchal masculinity, a viewpoint that advocates the superiority of masculinity over femininity, or the authority of men over women.

Recently, however, we are witnessing more balanced representations of gender roles.

B. Gender Differences in Consumer Behavior Many societies expect males to pursue agentic goals, which stress self-assertion and mastery. However, they teach females to value communal goals, such as affiliation and building harmonious relations.

1. Beware of Gender Stereotypes in Advertising and Products Sex-typed products reflect stereotypical masculine or feminine attributes, and consumers associate them with one gender or another.

2. Androgyny and Gender-Bending Products Androgyny refers to the possession of both masculine and feminine traits.

Gender-bending products are items which are traditionally sex-typed items adapted to the opposite gender.

C. Toward Greater Gender Fluidity Marketers must be aware and respectful of current debates about gender identity and stay tuned in as the meaning of gender continues to evolve.

The proportion of American adults identifying as lesbian, gay, bisexual, transgender, queer, or other (LGBTQ+) has doubled since 2012.

Despite the growing visibility of the LGBTQ+ community in our culture, misconceptions and stereotypes still abound. .

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Chapter 9: Identity and the Self

D. The Quest for Gender Justice and Equality Despite some progress toward gender equality in the marketplace, the world of marketing continues to perpetuate many flawed and unjust gender roles. Progress around the world toward gender justice is slow and access to the marketplace is lagging.

Use Chapter Objective 9-4 Here Use Key Terms gender identity, gender roles, gender socialization, patriarchal masculinity, agentic goals, communal goals, sex-typed products, androgyny, gender-bending products, and LGBTQ+ Here Use Consumer Behavior Challenges 9-10, 9-11, 9-15, 9-21, and 9-23 Here

V.

The Body Body image refers to a consumer’s subjective evaluation of his or her physical self.

A. Ideals of Beauty and Stereotypes An ideal of beauty is a particular model, or exemplar, of appearance. Ideals of beauty for both men and women may include physical features as well as clothing styles, cosmetics, hairstyles, skin tone, and body.

1. Marketing and Advertising Contribute to a Society’s Ideals of Beauty Advertising and other forms of mass media play a significant role in determining which forms of beauty we consider at any point in time. An ideal of beauty functions as a sort of cultural yardstick. Consumers compare themselves to some standard and they are dissatisfied with their appearance to the extent that they don’t match up to it.

Advertisers also contribute to shaping our beliefs about males’ ideal appearance. A study of men who appear in advertisements found that most sport the strong and muscular physique of the “macho” male stereotype. This obsession is so common that it has its own unique label: bigorexia.

2. Beyond Ageism and Sexism Norms of beauty are continually changing. Female social media influencers are resisting and defying previously ageist and sexist fashion and beauty ideals.

B. Negative Consequences of Impossible Body Ideals Body image distortions are psychological disorders that cause the patient to believe that their body literally is bigger or smaller than others see it.

At least 400 websites attract people with “ana” and “mia” nicknames for anorexia and bulimia. These communities focus on what they call thinspiration.

Group dieting is a growing problem as consumers patronize blog rings devoted to excessive weight loss.

Vanity sizing refers to the deliberate assignment of smaller sizes to garments.

C. Body Positivity: Enter the Fatshionistas .

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Section 2: Internal Influences on Consumer Behavior

A recent study focused on fatshionistas, plus-sized consumers who want more options from mainstream fashion marketers. They found that indeed these consumers can agitate for change.

D. Body Decoration and Mutilation People in every culture adorn or alter their bodies in some way.

1. Body Modification Because many consumers experience a gap between their real and ideal physical selves, they often go to great lengths to change aspects of their appearance. Beard transplants are one of the latest trends for men!

2. Cosmetic Surgery Consumers increasingly choose to have cosmetic surgery to change a poor body image or simply to enhance appearance.

Medical tourism describes a rapidly growing sector of the global economy that encourages consumers to travel to other countries for surgical procedures that might be unavailable, more dangerous, or more expensive where they live.

3. Tattoos Tattoos offer consumers an opportunity to mark their uniqueness but also sometimes to mark belongingness to a particular group.

E. The Mechanized Body The invasion of wearable computing is at hand. Whether devices we wear on our wrist like the Apple Watch, or woven into our clothing, increasingly our digital interactions will become attached to our bodies.

Analysts believe the day when many of us will be chipped may not be that far off. After all, pet owners have been chipping their dogs for years to ensure that they don’t get lost.

Some people are pushing the envelope as they explore new ways to integrate their bodies with technology. These individuals are known as biohackers.

A cyborg refers to a person who lives a technologically enhanced existence, and who often possesses special abilities because she or he is linked to other parts of a larger system (internet).

Followers of The Singularity movement believe that we are headed toward a new era, where human intelligence will merge with computer intelligence to create a human/machine hybrid civilization.

Mapping of the human genome has created a whole new type of data: genetic data.

F. The Quantified Self Consumers are keeping track of their bodies’ performance as never before.

The quantified self can also be problematic. Researchers have shown that so much measuring and tracking reduces our enjoyment of those activities and our motivation to engage in them.

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Chapter 9: Identity and the Self

Use Chapter Objective 9-5 Here Use Key Terms body image, ideal of beauty, bigorexia, body image distortions, thinspiration, group dieting, vanity sizing, fatshionistas, wearable computing, chipped, biohackers, cyborg, the Singularity movement, genetic data, and quantified self Here Use Review Questions 9-3 and 9-6 Here Use Consumer Behavior Challenges 9-7, 9-9, 9-13, 9-14, 9-17, and 9-24 Here

End-of-Chapter Support Material REVIEW 9-1.

List three dimensions that describe the self-concept.

1.

2.

3.

9-2.

Content—facial attractiveness versus mental aptitude; Positivity or negativity—self-esteem; and Intensity, stability over time, and accuracy—the degree to which one’s selfassessment corresponds to reality. (5 minutes, Chapter Objective 9-1, AACSB: Reflective Thinking)

Compare and contrast the real versus the ideal self. List three products for which a person is likely to use each type of self as a reference point when they consider a purchase.

The ideal self is a person’s conception of how he or she would like to be, whereas the actual self refers to our more realistic appraisal of the qualities we have and don’t have.

Product choices will vary, but products associated with the ideal self are more likely to be expressive. (5 minutes, Chapter Objective 9-1, AACSB: Reflective Thinking,)

9-3.

Have ideals of beauty in the United States changed during the past 50 years? If so, how?

A study of almost 50 years of Playboy centerfolds shows that the women have become less shapely and more androgynous since Marilyn Monroe graced the first edition with a voluptuous hourglass figure of 37–23–36. However, a magazine spokesman comments, “As time has gone on and women have become more athletic, more in the business world and more inclined to put themselves through fitness regimes, their bodies have changed, and we reflect that as well. But I would think that no one with eyes to see would consider playmates to be androgynous.” (10 minutes, Chapter Objective 9-5, AACSB: Reflective Thinking) 9-4.

What does “the looking-glass self” mean? How do feelings about the self influence what we buy? .

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Section 2: Internal Influences on Consumer Behavior

This process of imagining the reactions of others toward us is known as “taking the role of the other,” or the looking glass self. According to this view, our desire to define ourselves operates as a sort of psychological sonar: We take readings of our own identity by “bouncing” signals off others and trying to project what impression they have of us.

(5 minutes, Chapter Objective 9-1, AACSB: Reflective Thinking) 9-5.

How do Eastern and Western cultures differ in terms of how people think about the self?

The emphasis on the unique nature of the self is much greater in Western societies. Many Eastern cultures instead stress the importance of a collective self, where a person derives his identity in large measure from his social group. Both Eastern and Western cultures see the self as divided into an inner, private self, and an outer, public self. However, where they differ is in terms of which part is seen as the “real you”—the West tends to subscribe to an independent construal of the self that emphasizes the inherent separateness of each individual. (5 minutes, Chapter Objective 9-1, AACSB: Multicultural and Diversity Understanding) 9-6.

How did tattoos originate?

Tattoos have a long history of association with people who are social outcasts. For example, the faces and arms of criminals in sixth-century Japan were tattooed as a means of identifying them, as were Massachusetts prison inmates in the nineteenth century and concentration camp internees in the twentieth century. Marginal groups, such as bikers or Japanese yakuze (gang members) often use these emblems to express group identity and solidarity. (5 minutes, Chapter Objective 9-5, AACSB: Reflective Thinking) CONSUMER BEHAVIOR CHALLENGE DISCUSS 9-7.

As wearable computing takes off, so too will the possibility of “chipping” people so that they can directly interact with their devices without having to go through an interface like a smartphone.

What ethical problems might this practice pose? Do the potential benefits outweigh the risks?

Student opinions will vary dramatically. It is important to work to keep the conversation constrained to only the idea of “chipping.” The ethical dilemmas associated with this concept are significant and should be explored in depth. (10 minutes, Chapter Objective 9-5, AACSB: Reflective Thinking and Ethical Understanding and Reasoning) 9-8.

At the end of the day, are you what you buy?

Student responses will differ based on opinion. Students may discuss the self-image congruence models that suggest we choose products when their attributes match some aspect of the self. Emotional connections can make consumers defensive of their favorite brands if they see negative information about those brands. Cognitive matching between product attributes and self-image should also be considered. Ideas such as the reflected self and self-concept can be used to support the student’s opinions. (10 minutes, Chapter Objectives 9-1 and 9-2, AACSB: Reflective Thinking) .

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Chapter 9: Identity and the Self

9-9.

Shopping for back-to-school “basics” used to mean T-shirts, jeans, socks and some notebooks. Now, many parents have a new item to add to the list: tattoos. About 45 percent of parents polled say that hair highlights, teeth whitening, even tattoos are among the items they will buy their kids to go back to school. What (if any) age is appropriate for kids to get these grownup modifications?

Students will have different opinions about the appropriate age for each of these three items. Some students may bring up the show “Toddlers in Tiaras,” where pre-school girls are often consumers of highlights and teeth whitening. Look for students to support their opinions with references to consumer socialization and what the use of the product means in relationship to the consumer’s self-concept. (15 minutes, Chapter Objective 9-5, AACSB: Reflective Thinking)

9-10. Restaurant chains that attract diners with buxom servers in short shorts have become so popular the industry has a name for this category: breastaurants. The largest eatery of this kind is Hooters, which boasts more than $1 billion in sales annually. Other category members include Twin Peaks, Mugs N Jugs, and Tilted Kilt. Is it ethical to hire women as waitresses because they have certain physical characteristics? Is it ethical to exclude others (including men) from these jobs if they don’t?

Student opinions will vary but will likely include information about Hooters or other chains that attract diners with servers in short shorts and tight or small tops. The discussion should focus on sex-typed products and how they reflect stereotypical masculine or feminine attributes, and how products are associated with one gender or another. (10 minutes, Chapter Objectives 9-3 and 9-4, AACSB: Reflective Thinking) 9-11. One consequence of the continual evolution of sex roles is that men are concerned as never before with their appearance. Men spend $7.7 billion on grooming products globally each year. A wave of male cleansers, moisturizers, sunscreens, depilatories, and body sprays washes up on U.S. shores, largely from European marketers. L’Oréal Paris reports that men’s skincare products are now its fastest-growing sector. In Europe, 24 percent of men younger than age 30 use skincare products— and 80 percent of young Korean men do. Even some cosmetics products, like foundation and eyeliner, are catching on in some segments, though men aren’t comfortable owning up to using them.

In fact, a British makeup product looks like a ballpoint pen so men can apply it secretly at the office. Over the past decade, the media paid a lot of attention to so called “metrosexuals”: straight males who are interested in fashion, home design, gourmet cooking, and personal care products. How widespread is this phenomenon? Do you see men in your age group focusing on these interests? Should marketers change how they think of male sex roles today?

Student responses will vary and include information based on their own life experiences.

An identification of sex-typed products should be made, and how marketers are challenging the stereotype. Men receive mixed messages about how they are supposed to behave and feel. One study found that men try to make sense out of three models of .

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Section 2: Internal Influences on Consumer Behavior

masculinity: the breadwinner, rebel, and man-of-action hero. Products are becoming more androgynous, and the orientation is not clearly defined. Study respondents did not link androgynous lifestyles to sexual orientation. The result of androgyny is the promotion of fender-bending products. (6 minutes, Chapter Objective 9-4, AACSB: Reflective Thinking) 9-12. Some activists object to Axe’s male-focused marketing because they claim it demeans women. In contrast, Dove’s “Natural Beauty” campaign gets kudos because it promotes more realistic expectations for girls. Guess what? The same company – Unilever – owns both Axe and Dove. Is it hypocritical for a big company to sponsor positive messages about women in one of its divisions while it sends a different message in another?

Student responses to this will vary. Some will see the behavior as hypocritical and others will say it is just a matter of segmentation and targeting based on an understanding of the target audience. When Unilever consolidated brands, they try to capture universal values – for Dove it was real beauty and for Unilever it was something they termed “bom chicka wah wah” – which could otherwise be characterized as appealing to men using the promise of sex. Two videos may help show the contrast in the strategies between the two brands: http://www.youtube.com/watch?v=9zKfF40jeCA is the Onslaught video from Dove; http://www.youtube.com/watch?v=SwDEF-w4rJk is a parody on the Onslaught video that shows Axe images. Recently, South Africa decided to pull the Fallen Angels ad from Axe because of a complaint. (20 minutes, Chapter Objective 9-3, AACSB: Reflective Thinking and Ethical Understanding and Reasoning)

9-13. The clothing chain H&M features computer-generated models on its website. The company drew criticism for presenting only picture-perfect people; for example, the Norwegian Broadcasting Corporation accused the chain of “creating unrealistic physical ideals.” A company spokesman defended the move by explaining that these unreal bodies would ensure that the garments remain the focus of online shoppers’ attention. In contrast, the teen-oriented magazine Seventeen pledged to always feature “real girls” in its pages. This change was in response to an online petition that gathered nearly 85,000 signatures in just 4 days. The 14-year old reader who posted the petition stated, “For the sake of all the struggling girls all over America, who read Seventeen and think these fake images are what they should be, I’m stepping up. I know how hurtful these photoshopped images can be.” What do you think of this argument—does the use of only “perfect” bodies create a problem for real shoppers?

Student’s responses will vary but cover similar issues. Body image refers to a consumer’ subjective evaluation of his or her physical self. Our evaluations don’t necessarily correspond to what those around us see. Whether the perceptions are accurate is not the point, because our insecurities weigh us down whether they’re justified or not. Some marketers exploit consumer’s tendencies to distort their body images when they prey on insecurities about appearance. Even social media impacts how we feel about our bodies.

Our satisfaction with the physical image we present to others depends on how closely we think the image corresponds to the ideal our culture values. An ideal of beauty is a .

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Chapter 9: Identity and the Self

particular model of appearance, and may include physical features, clothing styles, hairstyles, skin tone, and body type. Our desire to match these ideas drives a lot of our purchase decisions. However, beauty is not universal. Marketers and mass media play a large role in determining which forms of beauty we consider desirable. When we don’t measure up, it lowers our self-esteem, and can possibly diminish the effectiveness of an ad because of negative feeling. Our culture communicates standards of beauty virtually everywhere. An increase in body image distortion is occurring among females. These psychological disorders cause consumers to believe that the body is bigger or smaller than others see it. This results in eating disorders and other life issues for real shoppers.

(20 minutes, Chapter Objective 9-5, AACSB: Reflective Thinking) 9-14. Many people feel that a preoccupation with physical appearance diverts consumers from discovering true happiness, i.e., “you can’t judge a book by its cover.” On the other hand, recent research finds that a heightened interest in appearance can actually improve the mental health of elderly people; putting on make-up can slow the progress of dementia by helping sufferers keep their brains active. Numerous organizations provide wigs to chemotherapy patients who lose their hair to bolster their self-esteem. Is a focus on looks ultimately a positive or a negative force? How can marketers encourage a “healthy” interest in appearance?

Student responses will vary considerably and will likely be tied to their views of physical fitness. There is no “correct” answer to this question. Consideration should be given to directing student discussion to looking and the pros and cons of the idea of physical appearance. (10 minutes, Chapter Objective 9-5, AACSB: Reflective Thinking) 9-15. An important debate has existed for years about whether gender stereotypes in advertising influence and perpetuate existing values and norms around stereotyping at large, or whether advertising depictions simply reflect the values of society, without having much direct influence on them. Which way do you think this process works: Does advertising simply respond to ongoing changes in society, or is it instrumental in creating those changes? Are advertisers to blame for unrealistic images of people that motivate them to conform to these ideals?

Student responses will vary considerably. There is no “correct” answer to this question, though students should consider the role of advertisers in creating and maintaining these ideals. (10 minutes, Chapter Objective 9-4, AACSB: Reflective Thinking) 9-16. There is a tendency to become preoccupied with documenting the moment – the more pictures people take, the less they say they enjoy the actual experience. What’s your take?

Are we overly concerned with posting what we do as opposed to just experiencing things in the moment?

Student responses will vary considerably. Students may reflect on their own behavior in this practice. (10 minutes, Chapter Objective 9-3, AACSB: Reflective Thinking)

.

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Section 2: Internal Influences on Consumer Behavior

9-17. The chapter references a study that found when a larger body is labeled as “normal” size, people who see it become less concerned about overeating. What do you think? Will our culture’s new focus on body positivity ironically come back to bite us, as more people decide it’s OK to overeat?

Student responses will vary considerably and will likely be tied to their views of “normal” size. (10 minutes, Chapter Objective 9-5, AACSB: Reflective Thinking) APPLY 9-18. If our possessions do indeed come to be a part of us, how do we bring ourselves to part with these precious items? Researchers find that people often take steps to distance themselves from a favored object before they get rid of it. Strategies they identified include taking pictures and videos of the objects; moving them into an out-of-the way location such as a garage or an attic; or washing, ironing, and wrapping the item.

Interview people you know who have disposed of a product that was important to them— for example, a well-used car or a favorite sweatshirt that finally had too many holes to keep. What steps did they take to “divest” themselves of this attachment (such as removing personal items from a car before selling it, and so on)?

Answers will vary, some students will talk about giving these products to charity, others will discuss how they are just not needed anymore. (30 minutes, Chapter Objective 9-3, AACSB: Reflective Thinking) 9-19. Construct a “consumption biography” of a friend or family member. Make a list of or photograph his or her favorite possessions and see if you or others can describe this person’s personality just from the information provided by this catalog.

Students might like to bring in a short videotape of the types of products the subject owns.

This is usually a fun exercise, as students love to guess who the subject is. Usually, of course, they can pinpoint the person and come close to describing the person’s personality. (Possible Individual Field Project) (45 minutes, Chapter Objective 9-2, AACSB: Reflective Thinking) 9-20. Interview victims of burglaries or people who have lost personal property in floods, hurricanes, or other natural disasters. How do they go about reconstructing their possessions, and what effect did the loss appear to have on them? Similarly, poll your class: If their house or apartment was on fire and they could only take one possession with them as they evacuated, what would it be?

This project may be somewhat difficult to do if no losses have occurred. An alternative is to have students watch news broadcasts and record their impressions of the responses and demeanor of the interviewed subjects. Given the recent El Nino effect on the lives of many U.S. citizens, there will be many stories about losses and difficulties encountered. How does a marketer deal with these situations? See if the students can find marketing

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Chapter 9: Identity and the Self

responses that seem admirable and unacceptable. (60 minutes, Chapter Objectives 9-2 and 9-3, AACSB: Reflective Thinking) 9-21. Watch a set of ads on TV that feature men and women. Try to imagine the characters with reversed roles (i.e., the male parts played by women and vice versa) Can you see any differences in assumptions about sex-typed behavior?

Students will have fun with this challenge though it will be a revelation to some. An example of an ad that has women and men playing their traditional roles is a Duncan Hines cake mix commercial. The commercial shows the wife/mother making a cake.

When the cake is ready, the father/husband and children are smiling and happy. The ad then says, “Nothin’ says lovin’ like a cake from the oven.” If one switches the roles of the man and woman, the ad somehow would not correspond to our image of having a cake baked by someone who loves us. Most of the time we will want to see ads that reflect a reality, as we normally perceive it. (Possible Field Project Idea) (30 minutes, Chapter Objective 9-4, AACSB: Reflective Thinking) 9-22. How do people you know feel about their cars? Interview some of them about the “relationship” they have. Do they decorate their cars? Do they have nicknames for them?

And, check out a video on YouTube called “I Love My Car” to really see how deep these relationships can go.

Student answers will vary and should include a lively discussion about their relationship with their cars, and other important possessions. (30 minutes, Chapter Objective 9-2, AACSB: Reflective Thinking) 9-23. Many advertisers routinely purchase stock photography when they need an image of a certain kind of person to insert in an ad. Many photos of women reflect common stereotypes, ranging from the crisp businesswoman who wears a suit and glasses and holds a briefcase to the smiling mother who pours milk into cereal bowls for her kids at breakfast. Sheryl Sandberg, the Facebook executive who is an advocate for women in business, started an organization called Lean In to promote leadership. Lean In has now partnered with Getty Images, one of the biggest stock photography companies, to offer an image collection that represents women differently. The new collection depicts women as surgeons, painters, bakers, soldiers, and hunters. There are girls riding skateboards and women lifting weights. Look through a sample of current magazines and collect images of women. To what extent do they represent a range of roles? Categorize these images according to the type of product advertised and the situation that the photo depicts (e.g. multitasking women holding a tablet and a baby, happy homemaker, etc.). Based on what you find what message do our media give us about gender roles today?

Media continues to use stereotypical roles including females and the elderly. (30 minutes, Chapter Objective 9-4, AACSB: Reflective Thinking) 9-24. Young girls in our society are under tremendous pressure to express their sexualized identity – to wear tight clothing, post sexy images, or engage in inappropriate behaviors .

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Section 2: Internal Influences on Consumer Behavior

like watching porn or sexting. This emphasis can trigger a range of negative emotions, and it can even lead to anxiety, depression, eating disorders, PTSD, or in some cases, suicide. Do you agree with these research findings? How can marketers help to reduce these issues?

Student responses will vary greatly based upon their personal beliefs. (15 minutes, Chapter Objective 9-5; AACSB: Reflective Thinking)

CASE STUDY TEACHING NOTES Chapter 9 Case Study: Retailer Torrid: Empowering Women of all Sizes Summary of Case This case reviews recent efforts to capture the plus-size fashion market with a focus on the company Torrid, a direct-to-consumer apparel and intimates’ brand in North America. Torrid strives to empower curvy women to love the way they look through the brand’s focus on providing the perfect fit for their customers. Challenges serving this expanding market are noted along with the benefits of selling via ecommerce and the influence social media campaigns can have. Competitors are taking notice of Torrid’s success, expanding their plus-size offerings.

Suggestions for Presentation The case discusses the broader demographics with regard to body type, which contrasts with the consumer options. Apparel and intimates for larger women has been a limited market, which provides an opportunity for companies who actively pursue and cater to this market. Torrid is trying to cultivate a client base and name recognition through social media campaigns that not only celebrate all body types but solicit customer-generated content in doing so.

Suggested Answers for Discussion Questions CS 9-1: Explain the success that Torrid and similar brands have experienced in relation to selfconcept, self-esteem, and self-consciousness. How can the plus-size industry leverage what we know about consumer behavior to address self-esteem issues? Be sure to address the unique challenges facing plus-size brands in today’s marketplace.

Students should display understanding of factors that influence consumer decision making. Plus-size women have long been overlooked in apparel and especially in intimate apparel. Understanding this, marketers can recognize that plus-size women want to be celebrated and catered to just as all people do. Torrid’s social media campaigns are going against the norms of “traditional beauty” typically seen in mass media. Asking customers to serve as models for the clothing line not only empowers those women but other women who can begin to see themselves in the same way.

Framed as both celebration of beauty but also of rebelling against old standards, this marketing strategy can prime consumer decisions.

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Chapter 9: Identity and the Self

Companies marketing these products must be careful not to focus on their customers’ size, even while pointing out features that acknowledge the unique fashion needs of the market. Another challenge is getting consumers to come into stores that are focused on larger sizes. Also, some plus-size women are hesitant to invest in new clothes, believing they will lose weight and that their purchases will no longer be the right size. (15 minutes, Chapter Objectives 4 & 5, AACSB: Analytical Thinking) CS 9-2: Discuss the real-world changes that appear to be occurring with respect to media images of women. What are the reasons for this? Find two recent articles or examples that illustrate these changes.

This might go in two directions. The western standard is characterized by the trend over the last fifty years toward women being thinner and thinner, less voluptuous. The reality, however, is that the average size and weight of women in the United States has been increasing, as illustrated in the case. In discussing this issue, it’s important that students are able to cite specific campaigns or ads that illustrate one trend or the other (15 minutes, Chapter Objective 5, AACSB: Analytical Thinking) CS 9-3: How do you reconcile the greater degree of acceptance of plus-size women with the parallel emphasis our society continues to place on thinness (as evidenced by the billions we spend on diet products, exercise, and so on)? Given the health problems associated with obesity (heart disease, diabetes, etc.) should the industry continue to encourage this acceptance? What role is social media playing?

For Torrid, it is not a matter of encouraging acceptance of obesity or emphasizing thinness as an ideal. The issue is to meet the needs of plus-sized women. As for society, there are always ideals and people who do not meet the ideals. This is not something that can be easily reconciled. Torrid’s use of social media to solicit customer-generated content is a way of advancing new ideas and expanding the discussion in substantive ways. (15 minutes, Chapter Objectives 5, AACSB: Ethical Understanding and Reasoning) CS 9-4: Visit the website of Torrid or one of its competitors and discuss how the brand positions itself to support its customers' positive self-image. What is the brand's strategy to support a customer’s body image?

Have students explore the website and attempt to identify ways in which it might influence customer decision making. Ask the students to determine if the site’s content primes fast or slow decision-making. Ask students to identify any attempts to framing, priming, or nudging to shape consumer behavior. (15 minutes, Chapter Objective 1, 4 & 5, AACSB: Analytical Thinking)

Additional Support Material STUDENT PROJECTS Individual Projects .

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Section 2: Internal Influences on Consumer Behavior

1.

Ask students to contact the gay and lesbian student club on campus. Select a sample from both genders and ask them about how they view products marketed to their segment. Do they see a difference between what is targeted at them vs. what is targeted at the “straight” segments? Is stereotyping still prevalent? Have them provide examples.

Look for students to provide authentic responses from both genders. The responses are likely to vary depending on the person who is asked. Students can compare their responses in class and analyze the reasons for the differences. (30 minutes, Chapter Objective 9-4, AACSB: Reflective Thinking)

2.

Ask a student to bring to class two brands within the same product category that project different images to the consumer. Have the student discuss the projected images by comparing and contrasting the two different brands. What techniques did the marketer use to project these images? Is the self-concept of the buyer important? Explain.

Students may select products that appeal to different lifestyles or different genders. Look for students to identify characteristics of the brand, perhaps by noting the communications, packaging, distribution, pricing strategy, that help it establish an association with the specified image. The student can speculate about whether the marketer is attempting to fill a gap in the buyer’s self-concept. The student should support his/her opinion with an explanation of why s/he believes it is the case. (20 minutes, Chapter Objective 9-1, AACSB: Analytical Thinking)

3.

Ask students to interview the managers of two retail-clothing stores. See if they can discover the degree to which the managers believe that consumer personalities and selfimages are important to the marketing and promotional activities of their store. Ask the students if they are in agreement with the managers’ comments.

The responses are likely to vary depending on the person who is asked. Students can compare their responses in class and analyze the reasons for the differences, considering the type of retail store, the price points and level of service offered, and the gender(s) served by the store. (20 minutes, Chapter Objective 9-1, AACSB: Reflective Thinking)

4.

Have male students and female students (separately) interview three women and three men whom they think are just about the right weight for their height and bone structure (instruct students to tell respondents that their responses are completely confidential). The students should ask the respondents if they think of themselves as overweight, underweight, or about right. Then, see if they can determine how the subjects reached their conclusions. Next, ask the subjects if they are doing anything to manage their weight. If possible, have students ask the respondents what their weight and height are.

Discuss how the students seem to feel about their weight.

Subjects may reference ideals associated with the media and other sources of socialization. You may want to ask students to include questions about the subject’s cultural background to see if they can identify any differences based on culture. The .

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stigma associated with weight may prevent some respondents from wanting to share some of this information, especially with members of the opposite sex, which provides a challenge but also provides something else to discuss in class. (60 minutes, Chapter Objective 9-5, AACSB: Reflective Thinking) 5.

Have students find media examples of men exhibiting agentic as well as communal goals.

Have them do the same for women. How much did they find that each gender tended to adhere to the societal expectation?

Students should recognize that agentic goals stress assertiveness and mastery, while communal goals stress affiliation and relationships. For the second part, students should analyze whether it was more difficult to identify ads the opposite gender role (malecommunal; female-agentic) and what the portrayals in the ads they selected indicate about societal expectations. (45 minutes, Chapter Objective 9-4, AACSB: Reflective Thinking)

6.

Ask your students to compile a list of ten household chores. Then have each student interview two married couples (one newlywed and the other seasoned) to determine who usually performs that chore—the husband or the wife. If possible, have the students ask the subject when their spouse is not around. Do they agree? Have students share their findings with the class.

Students may observe more consistency among the seasoned couple than the newlywed couple, but it really depends on whom they speak. Students should look for evidence that the roles have changed or that the roles have not changed with the length of the marriage. (75 minutes, Chapter Objective 9-4, AACSB: Reflective Thinking)

7.

Assign students to collect advertisements that would tell a stranger something about their self-concept (and image). Have them put these ads on a poster board and bring them to class. Display the poster boards in class and see if the class can match the boards to the correct students.

Students like this assignment because it allows them to use creativity to tell a story about themselves using products and images. It also provides students with an opportunity to get to know one another better as they match the collages to the student. (30 minutes, Chapter Objective 9-1, AACSB: Reflective Thinking)

8.

Have students consider the ethical consequences of the products and promotional campaigns produced by both the fashion industry and the fast-food industry. Have them develop their thoughts as a written assignment. Have them share their responses in class before turning the assignment in.

Student opinions will vary. Look for students to support their opinions with information from the chapter. (45 minutes, Chapter Objectives 9-2 and 9-3, AACSB: Ethical Understanding and Reasoning)

.

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Section 2: Internal Influences on Consumer Behavior

9.

Assign students to collect five ads that show male or female models exhibiting tattoos or body piercings (they may want to consult tattoo-related magazines or they may print ads from the Internet). Comment on the reason for the display. Did the model match the product to be sold? Do people that do not have tattoos or body piercing relate well to the ad? How could you determine this?

The chapter notes that tattoos and piercings have become more mainstream. However, tattoos are still associated with rebellion and risk taking. Students should identify whether the image associated with the tattooed/pierced model is congruent with the image of the product. (30 minutes, Chapter Objective 9-5, AACSB: Reflective Thinking)

10.

Students should visit a website for cosmetic surgeons. Have them find testimonials from actual patients that describe the reasons why they obtained the augmentations that they did.

In addition to reporting about the testimonials, ask students to analyze the reasons why the consumers obtained the augmentation and relate the reasons to the concept of selfconcept. (20 minutes, Chapter Objectives 9-5, AACSB: Reflective Thinking)

11.

Within a 10-mile radius of the campus where the students are taking this class, have students put together a list of the tattoo parlors. Have them call each and find out how long they have been in business. Have them visit a few of the parlors that have been around the longest and interview the owner as to how many shops there were 10 years ago. Have the students then construct a list of the tattoo shops at that point in time.

Students should draw conclusions based on this comparison.

Students should notice an increase in the number of tattoo parlors. They may want to ask the owners of the parlors that have been around the longest how the clientele has changed (lifestyle, number of tattoos, volume of clients) as they form their conclusions.

(90 minutes, Chapter Objective 9-5, AACSB: Analytical Thinking)

Group Projects 1.

Ask groups to interview other students on campus and determine the type of behaviors and activities they are engaged in to appeal to others they meet both on and off campus.

Do they change their appearance depending on the person or persons they are meeting with? If they do, how and why? If they do not, why not?

When students think of others they meet on campus, they may think about particular groups (e.g. sorority/fraternity members, members of a sport team) or individuals (fellow students in a business class, parents of roommates, professors). If they do not, they may be prompted to do so. When students think of others they meet off campus, they may think of employers, students from other schools, patrons at an establishment where s/he works, etc. It is likely that students will recognize that we often change our appearance based on our audience and expectations/social norms. (120 minutes, Chapter Objective 9-1, AACSB: Reflective Thinking) .

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Chapter 9: Identity and the Self

2.

Have each student interview four people (one each in their 20s, 30s, 40s, and 50s) to determine how important appearance is on the job. Then have students form groups in class to discuss their findings. In addition, have them discuss their own opinions on this issue as well as whether or not they feel an employee’s appearance should be considered in performance evaluations. See if their attitudes change when the employee must deal directly with customers. This activity is also interesting when you ask the subjects about the proper appearance in church or at an important social function.

The type of job the interviewee holds and the individual’s cultural background may have a greater impact on their perception that appearance is more important than the age group they belong. Students are likely to have different opinions about the importance of appearance in customer-facing positions, church, and social functions. (120 minutes, Chapter Objective 9-1, AACSB: Reflective Thinking)

3.

Have student groups devise a list of traditional male traits with respect to personal care and hygiene. Then, have them visit a cosmetics section of a major department store and interview salespeople with respect to the nature of their male customers. What are they buying, and how are they using it? Then, have the groups compare their interview findings with their list of traditional characteristics.

Traditional male traits regarding personal care and hygiene might reflect ideas that suggest it is not masculine to preen or peacock. However, the increase in male consumption of tanning, teeth whitening, skin care, and even make-up products suggest an increased concern for personal appearance and a willingness to act on it. This may be a function of high divorce rates (resulting in men who want to have an improved appearance to start dating again) and women who are part of the work force who put less emphasis on how much money a potential spouse makes and more emphasis on his appearance. (45 minutes, Chapter Objective 9-2, AACSB: Reflective Thinking)

4.

Have each group design a role-playing scenario that deals with one of the following situations: (a) A 40-year-old male suddenly announces to his wife that he plans to get a tattoo. (b) A couple, both 40 years old, discusses with their teenage son or daughter whether tattooing or body piercing would be appropriate. How can arguments be avoided? (c) A female loan officer in a bank has decided to have her nose pierced.

Look for students to adopt the stereotypical characteristics of the individual in the situation they choose to role-play. Students involved in the role-play and student observers may comment on the meaning behind the tattoos and the piercings, and on whether it is culturally acceptable for individuals with different roles to express themselves in this way. (30 minutes, Chapter Objectives 9-2 and 9-5, AACSB: Reflective Thinking)

ONLINE ASSIGNMENTS Individual Assignments .

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1.

Go to www.victoriassecret.com. How does this website use enhancement of the self to attract consumers? Would you expect males to visit the site as well as females? How could the site make it easier for males to purchase from the site (remember, males make up a significant portion of sales in the organization’s retail stores)? Is sizing easy on this site? How could it be improved?

Victoria’s Secret may create a gap between the actual self and the ideal self for women in their target audience who visit the website. They sell the idea that their products can help women fill this gap by making them “sexy” or “angels.” The brand promise to men is similar – it is an idealized version of his partner. The site could make sizing easier (e.g. offering visuals for sizing), which may help broaden the site’s appeal to male consumers. (20 minutes, Chapter Objective 9-1, AACSB: Reflective Thinking)

2.

Go to www.tattoo.com. Need a tattoo? Ever thought about getting one? Well, this website might just get you started in that direction. After reviewing the site, what are your impressions about tattooing? How is a self-concept involved in this process? What might cause you to get a tattoo if you do not already have one? Pretend that you are going to get a tattoo—which one of the designs would you choose? Download it (or copy it).

Bring it to class; show your choice; explain why it is really “you.” Have fun with this one.

Tattoo.com is a site where you can submit your tattoo idea for a free artist’s rendering or explore existing tattoos for inspiration. Students should recognize that tattoos could be used by consumers to make statements about themselves. Tattoos are often associated with adventures or rebellion and venturesomeness. Ask students to explain why they selected the designs they did. (15 minutes, Chapter Objective 9-5, AACSB: Reflective Thinking)

Group Assignments 1.

As a group, visit several social networking sites. How are members at various sites expressing themselves? What kinds of information are they providing? What does that tell the reader about them? Are there differences between the various sites’ members and their expressions?

Students are likely to observe differences between men and women in terms of what and how often each gender shares. You may tie this assignment back to the question of employers looking at information about potential employees on Facebook. (30 minutes, Chapter Objective 9-1, AACSB: Reflective Thinking)

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Chapter 10: Personality, Values, and Lifestyles

Chapter 10: PERSONALITY, VALUES, AND LIFESTYLES

CHAPTER OBJECTIVES When students finish this chapter, students should be able to: 10-1. Explain how our personality influences the way we process marketing communications, make decisions, and respond to social influences.

10- 2. Describe how our behavior is shaped by our values and attitudes toward money, things, and time.

10- 3. Explain how our lifestyle is related to and informed by our consumer behavior.

10- 4. Summarize the ways that brands inform and influence our consumer behavior.

CHAPTER SUMMARY Explain how our personality influences the way we process marketing communications, make decisions, and respond to social influences.

The concept of personality refers to a person’s unique psychological makeup and how it consistently influences the way a person responds to his or her environment. Marketing strategies based on personality differences have met with mixed success, partly because of the way researchers have measured and applied these differences in personality traits to consumption contexts. Some analysts try to understand underlying differences in small samples of consumers by employing techniques based on Freudian psychology and variations of this perspective, whereas others have tried to assess these dimensions more objectively in large samples using sophisticated quantitative techniques.

Describe how our behavior is shaped by our values and attitudes toward money, things, and time.

Products take on meaning because a person thinks the products will help him or her to achieve some goal that is linked to a value, such as individuality or freedom. A set of core values characterizes each culture, to which most of its members adhere. Our lifestyles are influenced by how we feel about and prioritize important resources. Money has complex psychological meanings; we equate it with success or failure, social acceptability, security, love, or freedom.

Time is also an economic variable, or a resource that we must divide among our activities.

Similarly, our basic beliefs about the way the world should operate relative to how we feel about political and social causes tend to be related to the brands we prefer.

Explain how our lifestyle is related to and informed by our consumer behavior.

A consumer’s lifestyle refers to the ways they choose to spend time and money and how their consumption choices reflect these values and tastes. Lifestyle research is useful to track societal consumption preferences and to position specific products and services to different segments. .

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When marketers segment based on lifestyle differences, they often group consumers in terms of their AIOs (activities, interests, and opinions). We associate interrelated sets of products and activities with social roles to form consumption constellations. People often purchase a product or service because they associate it with a constellation that, in turn, they link to a lifestyle they find desirable. Psychographic techniques classify consumers in terms of psychological, subjective variables in addition to observable characteristics (demographics). Marketers have developed systems to identify consumer “types” and to differentiate them in terms of their brand or product preferences, media usage, leisure time activities, and attitudes toward broad issues, such as politics and religion.

Summarize the ways that brands inform and influence our consumer behavior.

A brand personality is the set of traits people attribute to a product as if it were a person.

Consumers assign personality qualities to all sorts of inanimate products. Like our relationships with other people, these designations can change over time; therefore, marketers need to be vigilant about maintaining the brand personality they want consumers to perceive. Forging a desirable brand personality often is key to building brand loyalty.

CHAPTER OUTLINE

I.

Personality Personality refers to a person’s unique psychological makeup and how it consistently influences the way a person responds to his/her environment.

Although we may undergo dramatic changes as we grow up, in adulthood measures of personality stay relatively stable. Studies of thousands of people’s scores on the widely used measurement instrument the Minnesota Multiphasic Personality Inventory (MMPI) confirm that our personalities tend to stabilize by the age of 30.

The Myers-Briggs Type Indicator, which is based on Jung’s work, is another widely used personality test.

A. How Can We Measure Personality?

1.

The Psychiatric Perspective: Consumer Behavior on the Couch The psychologist Sigmund Freud proposed that much of one’s adult personality stems from a fundamental conflict between a person’s desire to gratify his or her physical needs and the necessity to function as a responsible member of society. This struggle plays out in the mind among three systems.

The id is about immediate gratification; it operates according to the pleasure principle. The superego is the counterweight to the id. This system is essentially the person’s conscience. The ego is the system that mediates between the id and the superego. The ego tries to balance these opposing forces according to the reality principle, which means it finds ways to gratify the id that the outside world will find acceptable.

2.

Neo-Freudian Theories The Neo-Freudian movement puts greater emphasis on how individuals .

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3.

handle their relationships with others as opposed to unresolved childhood conflicts.

Carl Jung believed that the cumulative experiences of past generations shape who we are today. These shared memories create archetypes, or universally recognized ideas and behavior patterns.

Motivational Research Motivational research borrowed Freudian ideas to understand the deeper meanings of products and advertisements. This perspective relies on depth interviews with individual consumers.

The Zaltman metaphor elicitation technique (ZMET) is a widelyused adaptation of the motivational perspective. It’s a market research tool based on our tendency to think about something in terms of the images and metaphors that represent its underlying qualities.

B. Trait Theory Popular online matchmaking services such as match.com and eharmony.com offer to create your “personality profile” and then hook you up with other members whose profiles are similar. This approach to personality focuses on the quantitative measurement of personality traits, which we define as the identifiable characteristics that define a person.

1. The Big Five Personality Traits The Big Five Inventory is a set of five dimensions that form the basis of personality: • • • • •

Openness to experience Conscientiousness Extroversion Agreeableness Neuroticism

Personality affects how we process information, how we relate to other people, how we shop, etc. One important personality trait is whether we believe that humans and general phenomena are changeable versus fixed. Entity theorists view things as fixed and unchanging, while incremental theorists view things as more flexible and dynamic.

2. Need for Touch Need for touch is one type of need that captures an individual’s preference for using the haptic system, or the send of touch, to transmit and understand information. Need for touch includes a facet that is autotelic, which reflects the fun, pleasurable aspect of touch and a facet that is instrumental, which reflects the usefulness aspect of touch – that is, its ability to provide information.

3. Need for Perfection People can differ in need for perfection. Being a perfectionist has its downside when it comes to making decisions. They are driven by dichotomous thinking, a type of black-and-white cognitive thinking style. So, when faced with a difficult decision, perfectionists tend to give up once they realize that a .

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perfect outcome is no longer possible, and this leads them to make inferior decisions.

4. Trait Reactance Trait reactance is an individual predisposition to resist and oppose any influence perceived as a restriction on one’s autonomy. Some people are naturally high in psychological reactance; they do not like to be told what to do, and they do not like anyone influencing them.

Religiosity is the degree of religious observance and beliefs.

5. Frugality A trait relevant to how we shop is frugality. Frugal people deny short-term purchasing whims; they choose instead to resourcefully use what they already own.

Use Chapter Objective 10-1 Here Use Key terms personality, Minnesota Multiphasic Personality Inventory (MMPI), Myers-Briggs Type Indicator, id, pleasure principle, superego, ego, reality principle, archetypes, motivational research, the Zaltman metaphor elicitation technique (ZMET), personality traits, entity theorists, incremental theorists, need for touch, haptic system, autotelic, instrumental, need for perfection, dichotomous thinking, trait reactance, religiosity, and frugality Here Use Review Questions 10-1 and 10-2 Here Use Consumer Behavior Challenge 10-6 Here

II.

Values A value reflects what is important to us or what we consider good or bad.

A. Belief Systems Two people can believe in and exhibit the same behaviors (e.g., vegetarianism), but their underlying belief system may be quite different (e.g., animal activism versus health concerns). The extent to which people share a belief system is a function of individual, social, and cultural forces.

In many cases values are universal. Who does not desire health, wisdom, or world peace? What sets cultures apart is the relative importance, or ranking, of these universal values. This set of rankings constitutes a culture’s value system.

It is usually possible to identify a general set of core values that uniquely define a culture. For example, core values such as freedom, youthfulness, achievement, materialism, and activity characterize U.S. culture.

B. How Can We Understand Values?

Psychologist Milton Rokeach developed the Rokeach Value Survey which included a set of terminal values, or desired end states, and a set of instrumental values, actions we need to take to achieve these terminal values.

C. The Means-End Chain Model The means–end chain model assumes that people link specific product attributes .

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(indirectly) to terminal values: We choose among alternative means to attain some end state that we value.

A technique researchers call laddering uncovers consumers’ associations between specific attributes and these general consequences.

D. Syndicated Surveys A number of companies track changes in values through large-scale surveys. They sell the results of these studies to marketers, who receive regular updates on changes and trends.

Materialism refers to the importance people attach to worldly possessions.

Materialists, then, are more likely to value possessions for their status and appearance-related meanings. Materialistic people also appear to link more of their self-identity to products.

Materialistic values start with what we learn from our parents. But according to cultivation theory, another powerful source of influence is cumulative exposure to television and the lifestyles we observe on fictional shows.

E. Toward More Simplicity Of late one important trend that runs counter to materialism is minimalism. This describes a simple lifestyle, with an emphasis on getting rid of things you don’t need.

The pandemic prompted many people to adopt a fresh start mindset – the belief that people can restart or reset something in their lives, despite any past or current obstacle.

F. Values Related to Money Compared with those with a spending orientation, individuals with a saving orientation are naturally motivated to exercise self-control to save money and to monitor spending in a regular and consistent manner.

Not surprisingly, we tend to make poorer financial decisions when we are stressed. Research identified lifestyle-based depletion, a feeling that one cannot keep up with the responsibilities and expectations placed upon them. The research found that this depletion creates high stress and reduces our ability to exercise self-control on purchase decisions.

G. Values Related to Time Time is one of our most precious resources.

Open rates refer to the percentage of people who open an email message from a marketer.

Many consumers believe they are more pressed for time than ever before; marketers label this feeling time poverty.

1. Timestyles Time is an economic variable; it is a resource that we must divide among our activities. An individual’s priorities determine their timestyle.

A study examined how the timestyles of a group of U.S. women influenced their consumption choices. Five metaphors capture the participants’ perspectives on time: • Time is a pressure cooker.

• Time is a map. .

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• Time is a mirror.

• Time is a river.

• Time is a feast.

2. Psychological Time and Deceleration It’s important for marketers to understand psychological time because we’re more likely to be in a consuming mood at certain times than we are at others.

A recent ethnography of people who took the Camino de Santiago pilgrimage in Spain found that consumers seek out such experiences to find deceleration.

The travelers slowed down the experience of time by decreasing the traveled distance, the use of technology, and the number of experienced episodes.

Use Chapter Objective 10-2 Here Use Key terms value, belief system, value system, core values, terminal values, instrumental values, means-end chain model, laddering, materialism, cultivation theory, minimalism, fresh start mindset, spending orientation, saving orientation, lifestyle-based depletion, open rates, time poverty, timestyle, psychological time, and deceleration Here Use Consumer Behavior Challenges 10-5, 10-7, and 10-13 Here

III.

Lifestyles and Consumer Identity E-sports fans, those who get their kicks by watching other people play video games, make choices about how they spend their time.

Lifestyle defines a pattern of consumption that reflects a person’s choices of how to spend his/her time and money. These choices play a key role in defining consumer identity.

A lifestyle marketing perspective recognizes that people sort themselves into groups on the basis of the things they like to do, how they like to spend their leisure time, and how they choose to spend their disposable income.

A goal of lifestyle marketing is to allow consumers to pursue their chosen ways to enjoy their lives and express their social identities.

A. From What to Why: Psychographics Psychographics involves the “use of psychological, sociological, and anthropological factors . . . to determine how the market is segmented by the propensity of groups within the market—and their reasons—to make a particular decision about a product, person, ideology, or otherwise hold an attitude or use a medium.”

Demographics allow us to describe who buys, but psychographics tells us why they do.

1. How We Perform a Psychographic Analysis Psychographic studies take several different forms: • A lifestyle profile looks for items that differentiate between users and nonusers of a product. .

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•

A product-specific profile identifies a target group and then profiles these consumers on product-relevant dimensions.

• A general lifestyle segmentation study places a large sample of respondents into homogenous groups based on similarities of their overall preferences.

• A product-specific segmentation study tailors questions to a product category.

2. Buyer Personas When marketers combine personality variables with knowledge of lifestyle preferences, they have a powerful lens they can focus on consumer segments.

They call these lenses the buyer personas. (Some call them avatars.)

3. AIOs Most contemporary psychographic research attempts to group consumers according to some combination of three categories of variables: activities, interests, and opinions – AIO for short.

Marketers use the results of these studies to: • Define the target market • Create a new view of the market • Position the product • Better communicate product attributes • Develop product strategy • Market social and political issues Clustering together consumers into distinct lifestyle groups known as lifestyle segmentation typologies allows marketers to more easily identify and reach similar consumers.

The best-known lifestyle segmentation system is the Values and Lifestyles System (VALS2). (Figure 10.3) The VALS2 groups are: • Innovators • Thinkers • Achievers • Experiencers • Believers • Strivers • Makers • Strugglers Use Chapter Objective 10-3 Here Use Key terms e-sports, lifestyle, lifestyle marketing perspective, psychographics, buyer personas, AIO, lifestyle segmentation typologies, and Values and Lifestyles System (VALS2) Here Use Review Questions 10-3 and 10-4 Here Use Consumer Behavior Challenges 10-8, 10-11, 10-12, and 10-14 Here

.

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IV.

The Roles Brands Play in Our Lives Brands matter because of what they mean.

A. The Brand Personality A brand personality is the set of traits people attribute to a product as if it were a person.

B. How Do We Get to “Know” a Brand?

Just as we rely on all sorts of cues to infer a human being’s personality, the same is true when we try to figure out brand personality. A product’s design is a cure and packaging is another. Shapes and colors link to meanings. Another important cue is a brand name.

C. The Meaning Transfer Model Consumers absorb brands’ meanings through a meaning transfer process.

Brands themselves gather cultural meaning by borrowing from cultural systems.

When consumers bring brands into their lifestyles, they take possession of those meanings.

D. Brand Resonance Forging a successful brand personality often is key to building brand loyalty.

Marketers who are able to create brand resonance cement a bond with the consumer that is very difficult to break.

The phenomenon of Doppelgänger brand image occurs when consumers, unhappy with the brand, create websites to attack the brand or post parodies.

E. Archetypes (Again) Advertisers often refer to Jung’s theories when they set about to create a vivid brand personality. These images appear frequently in marketing messages that feature characters such as wizards, revered teachers, or even Mother Nature.

F. Spokescharacters Companies often rely on spokescharacters to make their brand seem more humanlike. Another advantage is that these mythical creatures can help companies when they face a trust crisis because a well-liked spokescharacter can help to reassure consumers if a brand encounters a problem.

A recent study examining how people interact with service robots (specifically designed to interact with customers) found that certain robot design features and characteristics trigger feelings of anthropomorphism, the tendency to attribute human characteristics to objects or animals.

G. Congruence Between Consumer and Brand Consumers tend to prefer brands with personalities that match their own.

Narcissists are more inclined toward arrogant brands, or brands that communicate the message they are superior to others. Narcissists respond well to arrogant brands because they feel self-congruent with them. Self-congruity occurs when a consumer sees their self-concept reflected in a brand.

H. Lifestyle Brands and Lifestyle Brand Constellations The designer Ralph Lauren has crafted a classic lifestyle brand that people around the world associate with American lifestyle.

A lifestyle marketing perspective implies that we must look at patterns of behavior to understand consumers. .

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Chapter 10: Personality, Values, and Lifestyles

Many products and services do seem to “go together”, usually because the same types of people tend to select them.

An important part of lifestyle marketing is to identify the set of products and services that consumers associate with a specific lifestyle.

Many people today evaluate products not just in terms of functions but also in terms of how well their design coordinates with other objects and furnishings.

Marketers who understand these cross-category relationships may pursue cobranding strategies where they team up with other companies to promote two or more items.

Product complementarity occurs when the symbolic meanings of different products relate to one another. Consumers use these sets of products we call a consumption constellation to define, communicate and perform social roles.

I. Selling Authenticity Today one of the most important criteria for many consumers is authenticity or being trustworthy and genuine.

J. Brand Storytelling It’s increasingly common for marketers to think carefully about bringing their brands to life as they embrace the communications approach known as brand storytelling. This is based on a long tradition of brand narrative research, which has documented the immersive power of stories and the ability for readers of the stories to engage with and participate in the story by “filling in the blanks.”

A brand storytelling perspective lets the consumer engage with and navigate the brand’s transmedia world. This refers to the complex web of places where consumers can engage with brands.

The backstory, a behind-the-scenes experience of the brand’s history, encourages consumers to learn as much as they can about the brand’s “inside story.”

When a brand is an underdog, its brand biography, the history of its origins or founders, is especially compelling.

Use Chapter Objective 10-4 Here Use Key terms brand personality, meaning transfer process, brand resonance, Doppelganger brand image, service robots, anthropomorphism, arrogant brands, self-congruity, lifestyle brand, cobranding strategies, product complementarity, consumption constellation, authenticity, brand storytelling, brand narrative, transmedia world, backstory, and brand biography Here Use Consumer Behavior Challenges 10-9 and 10-10 Here

End-of-Chapter Support Material .

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REVIEW 10-1. How does Freud’s work on the unconscious mind relate to marketing practice?

Freud believed that much of our personality stems from the desire to satisfy physical needs and the need to be a responsible member of society. The id directs a person towards pleasure and can be used by marketers to increase desire for a good or service.

The superego tempers this urge. According to the reality principle, the ego will try to gratify the id in a way the outside world will find acceptable. Marketers promote products as a means of gratification. In particular, it highlights the potential importance of unconscious motives that guide our purchases. The implication is that consumers cannot necessarily tell us their true motivation when they choose products, even if we can devise a sensitive way to ask them directly. The Freudian perspective also raises the possibility that the ego relies on the symbolism in products to compromise between the demands of the id and the prohibitions of the superego. People channel their unacceptable desire into acceptable outlets when they use products that signify these underlying desires. This is the connection between product symbolism and motivation: The product stands for, or represents, a consumer’s true goal, which is socially unacceptable or unattainable. By acquiring the product, the person vicariously experiences the forbidden fruit. (10 minutes, Chapter Objective 10-1, AACSB: Reflective Thinking) 10-2. Core values evolve over time. What do you think are the three to five core values that best describe Americans today?

Student responses will vary as the list of core values can be long. Students should understand that core values uniquely define a culture and include values such as freedom, youthfulness, materialism, and activity. (5 minutes, Chapter Objective 10-2, AACSB: Reflective Thinking)

10-3. What is the basic philospophy behind a lifestyle marketing strategy?

A lifestyle marketing perspective recognizes that people sort themselves into groups on the basis of the things they like to do, how they like to spend their leisure time, and how they choose to spend their disposable income. (5 minutes, Chapter Objective 10-3, AACSB: Reflective Thinking) 10-4. How can marketers stay on top of changes in lifestyle trends?

Marketers use psychographics to group customers based on some type of variable, such as activities, interests, or opinions. Many research companies and advertising agencies develop a lifestyle segmentation typology. These incorporate psychological and demographic data to divide adults into groups. These groups indicate what a consumer might be passionate about, such as social issues, achievement, or branding. Based on the .

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needs of the group, marketing can be changed to promote what is most important to that consumer group. (5 minutes, Chapter Objective 10-3, AACSB: Reflective Thinking) CONSUMER BEHAVIOR CHALLENGE DISCUSS 10-5. One way to clearly see the impact of shifting cultural values on consumption is to look at the increasing emphasis on the importance of health and wellness. In recent years, topperforming new food/beverage products featured items with natural or organic ingredients, such as Chobani yogurt and Nature’s Pride bread. Where is this trend going—is it just temporary or does it reflect a more permanent change in how U.S. Americans look at what they eat and drink?

A value is a belief that some condition is preferable to its opposite, for example, organic food is believed to be better for you than processed food. Consumers purchase products because they believe these products will help them attain a value related goal, such as improved health. These purchases support the consumer’s value system and core values that define them as consumers. The media acts to reinforce these values, thereby ensuring an ongoing trend in healthier food choices. Acculturation occurs when we share knowledge with others to promote the same goals. The use of natural and organic ingredients is a trend that is becoming more permanent as labeling guidelines and laws are established to better identify natural and organic foods, (5 minutes, Chapter Objective 10-2, AACSB: Reflective Thinking)

10-6. Is there such a thing as personality? If so, how might you integrate knowledge about consumer’s personality traits into a marketing strategy?

Responses will differ based on the student’s views. Personality influences the way a consumer responds to stimuli, and marketing efforts capitalize on this with mixed results.

Personality is how we respond to the environment. However, there are studies that find people do not have stable personalities, and that this is just a way to categorize people.

Others studies show that personality is stabilized by the age of 30. We know that people do not act consistently in all situations. A marketer can capitalize on the unstable personality by highlighting the benefits of buying a product to fit in with peers. A marketer might capitalize on a more mature personality by indicating the same goals. (5 minutes, Chapter Objective 10-1, AACSB: Reflective Thinking)

10-7. Is it accuracte to claim that sustainability is now a core value for Americans? Why or why not?

Responses will differ based on students' opinions. Students should understand that a general set of core values uniquely define a culture, and core values evolve over time.

Some analysts feel our focus on physical objects is shifting towards the consumption of .

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experiences instead. Consumers in the U.S. are increasingly valuing sustainability and rewarding companies that are environmentally friendly. (5 minutes, Chapter Objective 102, AACSB: Reflective Thinking) 10-8. The chapter discusses how Facebook data has been illegally used to develop consumer profiles that can help organizations to tailor messages that will appeal to them. Do improper uses of data as well as data breaches that make us vulnerable to hackers merit additional regulation of social media by government agencies (that might themselves make use of these data for “security” purposes)? What is the proper tradeoff between freedom of information and consumer privacy?

Responses will differ based on students' opinions. The question should lend itself to a lively discussion between those students looking for more government oversight and those believing such matters are better left to individual consumers and companies. ( 5 minutes, Chapter Objective 10-3, AACSB: Reflective Thinking)

APPLY 10-9. Identify some of your favorite brands. If each “came to life” as a person, what kind of person would he or she be? Describe the brand personality of each – on what basis do you infer these traits?

The first thing students will have to do to answer this question is to establish the ten personality dimensions. They are free to construct these as they choose; however, the material in the chapter offers some suggestions. The differences will be the result of differences observed. It will be easier for them if they choose products from a brand category with which they are familiar. (Many times students will know more about the brand than what is shown in the advertisement.) Be sure the students demonstrate “how” personalities relate to the advertising and packaging used by the marketer to differentiate these products. (10 minutes Chapter Objective 10-4, AACSB: Reflective Thinking) 10-10. Interview a set of consumers about their favorite brands; things they “can’t live without.”

Based upon the discussion of brand resonance in the chapter, see if you can identify the type of attachment that’s operating for each consumer-brand connection.

Responses will vary based on student opinions. Forging a successful brand personality is key to building brand loyalty. Marketers who are able to create brand resonance cement a bond with the consumer that is very difficult to break. Encourage the students to openly discuss the types of attachments they feel for their “favorite brands.” (10 minutes Chapter Objective 10-4, AACSB: Reflective Thinking) 10-11. Using media that target college students, construct a consumption constellation for this social role. What set of products, activities, and interests tend to appear in advertisements depicting “typical” college students? How realistic is this constellation? .

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Answers will vary but will include textbooks, dorm life, sports, professors, etc. Most students will think that these factors are realistic. (15 minutes, Chapter Objective 10-3, AACSB: Analytical Thinking) 10-12. Extreme sports. YouTube. Pinterest. Veganism. Can you predict what will be “hot” in the near future? Identify a lifestyle trend that is just surfacing in your universe. Describe this trend in detail, and justify your prediction. What specific styles or products relate to this trend?

Do it yourself (DIY), solutions, recipes, and crafts. (30 minutes, Chapter Objective 10-3, AACSB: Reflective Thinking,) 10-13. Collect a sample of ads that appeal to consumers’ values. What value is being communicated in each ad, and how is this done? Is this an effective approach to designing a marketing communication?

A value is a belief that some condition is preferable to its opposite. Two people can believe in and exhibit the same behaviors (e.g., vegetarianism), but their underlying belief system may be quite different (e.g., animal activism versus health concerns). The extent to which people share a belief system is a function of individual, social, and cultural forces. Advocates of a belief system often seek out others with similar beliefs so that social networks overlap; as a result, believers tend to be exposed to information that supports their beliefs. (15 minutes, Chapter Objective 10-2, AACSB: Reflective Thinking) 10-14. Identify three distinct “taste cultures” within your school. Can you generate a “consumption constellation” for each (clothing, music, leisure activities, etc.)?

The answers to this question will be as varied as the students in your class. The creation of the consumption constellations should be utilized to easily engage students. (20 minutes, Chapter Objective 10-3, AACSB: Reflective Thinking)

CASE STUDY TEACHING NOTES Chapter 10 Case Study: Beyoncé’s Beyhive – Honeybees and Killer Bees in Love with their Queen Summary of Case This case is focused on pop music superstar Beyoncé Knowles, her several business ventures, and most of all, her enthusiastic fan base known as the Beyhive. These passionate fans help promote her brand but can also be vicious online towards anyone they believe is disrespecting their “queen.” The case provides an opportunity to discuss the marketing of celebrities and also helps explain brand devotion and its benefits for brand extensions. .

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Suggestions for Presentation This material can be used to illustrate how brands can take on their own life, replete with their own personalities, meanings, and narratives.

Suggested Answers for Discussion Questions CS7-1. How would you describe the consumer identity of the Beyhive – the Beyonce fans? Are there particular personality or lifestyle characteristics that members of the Beyhive share?

Student answers may vary but will include a discussion on consumer identity and lifestyle marketing and draw references from the case study. Personality or lifestyle characteristics of members of the Beyhive might include consumers of pop/R&B music, fashions in line with those Beyoncé wears or sells, and for female fans, the projection of a feeling of confidence and empowerment. (5 minutes, Chapter Objective 3, AACSB: Reflective Thinking) CS7-2. How would you describe Beyoncé’s brand personality? How has it changed or evolved over the expanse of her solo career? How does it compare with other celebrity brand personalities with which you’re familiar?

This is a great opportunity to have students apply what they’ve learned in this case to other brands and celebrity personalities they’re familiar with. Beyoncé fans are drawn to the Beyhive lifestyle and draw energy from their connection with Beyoncé’s messages of honesty, independence, and empowerment. Such a message is inspiring and infectious, and so her fans not only want to share it with others but also defend her from any criticism. Students have an opportunity to think critically about how other strong brand personalities compel such strong followings. (10 minutes, Chapter Objective 2, AACSB: Analytical Thinking) CS7-3. If you were hired as Beyonce’s brand manager, what types of products and services would you suggest she consider endorsing? How would these products appeal to the members of the Beyhive community? Develop a list of specific marketing and promotional tactics that might be used to reach the Beyhive target market.

Student answers may vary but should incorporate ideas related to relating to values Beyoncé promotes in her music. To spark ideas, suggest categories such as experiences (travel), prepared food (restaurants), jewelry/watches, and electronics. (10 minutes, Chapter Objective 4, AACSB: Application of Knowledge) CS7-4. What are some of the potential downsides of aligning yourself with a brand personality like Beyonce? Is there any harm in being a member of the Beyhive? Explain.

There is a definite risk that some fans, particularly more marginal ones, will not want to be seen as being the same as the most intense members of the Beyhive. Beyoncé must .

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walk a tight wire of appreciating her most rabid fans while not encouraging crazy and vindictive behavior that might alienate more moderate fans. The safest and most balanced way to handle this challenge would probably be to make some occasional acknowledgment to the grassroots Beyhive movement (perhaps at concerts) and then to conduct a more traditional fan engagement in official communications like her website.

(10 minutes, Chapter Objective 1 & 2, AACSB: Reflective Thinking)

Additional Support Material STUDENT PROJECTS Individual Projects 1.

Have students collect print advertisements that portray some of the aspects of Freudian principles in action. Do they seem effective? Is the message lost in the execution?

Students are likely to select ads that portray phallic symbols, the id, the superego, or conflicts between the two. Students may get confused about the Freudian ego and select ads that feature characters that have a “big ego," so be sure the students know the difference. (30 minutes, Chapter Objective 10-1, AACSB: Reflective Thinking)

2.

Ask students to examine advertisements and determine which appear to be Freudian or Neo-Freudian in nature. How is this determined? What were the messages in the advertisements?

Freudian ads are likely to be about sexual conflicts, while Neo-Freudian ads are likely to be about relationships. Students may gravitate toward ads with archetypes for the NeoFreudian examples. (20 minutes, Chapter Objective 10-1, AACSB: Reflective Thinking)

3.

Have each student develop a description of his or her own pleasure principle as it relates to consumption. In other words, how is their pleasure maximized and pain minimized when they buy certain types of products? What are the things that marketers do to appeal to this?

Students are likely to select products that provide immediate gratification. Marketers may appeal to consumer emotions and promote the experience of pleasure in the communications for the product. The advertising campaign, “What Happens in Vegas Stays in Vegas,” promises pleasure without consequences. (10 minutes, Chapter Objective 10-1, AACSB: Reflective Thinking)

4.

Have students select an ad or series of ads from a well-known campaign. Based on the ad, how have archetypes been formed among consumers?

Archetypes are universally shared ideas and behavior patterns. These memories would be .

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about birth, death, and the devil (as shown in myths, stories, and dreams). Students may refer to Table 6.1. (30 minutes, Chapter Objectives 10-3 and 10-4, AACSB: Reflective Thinking,) 5.

Have each student characterize three different people that they associate with (friends, coworkers, classmates, family members, etc.) based on traits (trait theory). Each of the three should be distinct. How could an advertiser use this information?

Traits include extroversion (socially outgoing) and introversion (quiet and reserved); innovativeness (degree to which a person likes to try new things); materialism (amount of emphasis a person places on acquiring and owning products); self-consciousness (degree to which a person deliberately monitors and controls the image of the self that he or she projects to others); need for cognition (degree to which a person likes to think about things and by extension expends the necessary effort to process brand information); and frugality (frugal people deny short-term purchasing whims in favor of resourcefully using what they own). (15 minutes, Chapter Objective 10-1, AACSB: Reflective Thinking)

6.

Ask students to list three products that seem to have personalities. Describe the personalities. What types of people buy these products? Is there a match between the consumer’s personality and that of the brand or product?

Examples of personality dimensions include old fashioned, wholesome, traditional, and lively. Depending on the products, the personalities may match the consumer’s or not. If not, remind students that a consumer may select a product with a different personality if s/he desires to have more of that personality trait. (20 minutes, Chapter Objectives 10-1 and 10-4, AACSB: Reflective Thinking)

7.

This chapter mentions that politicians can market themselves through the use of psychographic analyses. What are some of the marketing strategies and techniques used by politicians in recent elections? Did the candidates design special appeals to attract the attention of special target markets? What communication strategies were used? Discuss your observations with the class.

Student responses will depend on the most recent election and whether they select a local or national candidate race. In the 2008 presidential election, President Obama bought commercial time on MTV, Comedy Central, and VH1. He advertised using mobile advertising and banners, as well as on Facebook. He purchased virtual billboards in video games. He used these strategies to reach the younger demographic based on their interests and activities. (20 minutes, Chapter Objective 10-3, AACSB: Reflective Thinking,)

8.

Ask a student to bring in an ad in which the brand being marketed was at one time a status symbol but fell out of fashion for a time (e.g., Cadillac, Parker Pen, Izod-Lacoste, etc.). Have the student discuss whether the ad still attempts to create that perception.

What new product, if any, has replaced the featured product as a status symbol? .

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For a status symbol to distinguish a customer and show they have “made it,” it must be exclusive in some way. Cadillac, for example, hurt its image as a status symbol when it introduced lower priced models and offered inexpensive leases, making the brand more available to those with less money. That, coupled with the fact that it only retained appeal to an older audience that did not want the increasingly desirable foreign luxury cars, hurt its ability to continue to communicate status. (25 minutes, Chapter Objective 10-4, AACSB: Reflective Thinking

9.

Ask students to think of a specific lifestyle (your own, your parent’s, your aspirations, etc.) and then make a list of products and services that are linked in the consumer’s mind to that specific lifestyle. (Hint: You might decorate your living room, design a wardrobe, think of options for a car, etc.)

Student responses will vary. It may be helpful to narrow down the specific task, perhaps using the hints to select one area where the lifestyle might be reflected. (30 minutes, Chapter Objective 10-3, AACSB: Reflective Thinking)

Group Projects 1.

Have students develop print or video advertisements that apply Freudian and Trait theory principles for products or services that target college students. Have them explain if their advertisements will work effectively. Ask them to test the advertisements with other students that are not in the consumer behavior class.

Students should identify how they have applied Freudian and trait theory principles in their response about whether the advertisements will work effectively. This exercise will provide students with the opportunity to think critically about the application of these theories. (180 minutes, Chapter Objectives 10-1 and 10- 2, AACSB: Reflective Thinking and Written and Oral Communication)

2.

Using AIO segmentation, have groups of students design a new advertising campaign for a chain of restaurants targeting young professional college graduates. Have them explain the process they went through.

Students should include activities, interests, and opinions, and may refer to Table 7.3.

Look for students to relate the message in the advertising campaign to their understanding of the segment based on these three dimensions. (120 minutes, Chapter Objective 10-3, AACSB: Reflective Thinking)

3.

Assign groups of students to go to an airport (or other location where they will find lots of foot traffic) to people watch. Have them classify as many people as possible according to social class based on the appearance and behaviors of individuals. Have the class as a whole discuss their results. What lessons can be learned from this?

.

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It will be challenging for students to determine social class based on the appearance of individuals. Further, some social classes are not likely to be represented at the airport.

Students may rely on status symbols and distinguish people based on behaviors, like whether they travel business class or first class. International airports will add another layer of complexity to trying to determine the social class of individuals since status symbols in other countries are different from those in the United States. (90 minutes, Chapter Objective 10-3, AACSB: Reflective Thinking) 4.

Student groups should identify three examples of lifestyle marketing on the internet.

Have members of the group demonstrate at least one of these sites in class. Show how the site uses lifestyles to the organization’s advantage.

5.

Students should select websites that appeal to people with common leisure activities and discretionary spending habits. Many sites are aimed at a specific lifestyle so they can attract a certain type of advertiser. The exercise can also be done with blogs. (15 minutes, Chapter Objective 10-3, AACSB: Reflective Thinking)

ONLINE ASSIGNMENTS Individual Assignments 1.

Go to www.bebe.com. Analyze the product offerings for this company based on the id and the superego. Do people who buy this brand do so based on one or the other? Explain how the ego may create balance.

Bebe.com is a website for a women’s clothing retailer. Students will probably associate the fashions offered by the retailer with the id. However, the website also includes information about Bebe’s support of a foundation at times, which students may see as an effort to balance the hedonic aspects promoted on the rest of the website. (20 minutes, Chapter Objective 10-1, AACSB: Reflective Thinking)

2.

First, print out the VALS types along with their descriptions. Hand them to the students and have them select the type they think they are. After noting their choices, have them visit http://www.strategicbusinessinsights.com/vals/presurvey.shtml and take the survey to determine who they really are. Is the self-selection different from the results of the survey? If yes, why do they feel they are different from what the survey states? Can the differences be reconciled?

This exercise should deepen student engagement with the VALS types, which should increase their understanding of the VALS framework. They may also evaluate the measurement used to categorize consumers on the framework. (30 minutes, Chapter Objective 10-3, AACSB: Reflective Thinking)

3.

Go to www.burtsbees.com. How does this site use lifestyle marketing to its advantage?

What lifestyle would be most associated with the products shown on this site? After .

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reading the history of the founders, how were the founders able to project their own lifestyles into the products produced by the company? How could the company expand its sales into other lifestyle segments?

Burt’s Bees sells natural products. Its products are likely to appeal to people whom value natural products and the environment. Its founders include their story on the website and on the packaging for some of the products. Look for students to talk about expansion into other lifestyle segments in ways that does not alienate the current lifestyle segment. (15 minutes, Chapter Objective 10-3, AACSB: Reflective Thinking)

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Chapter 11: Social and Cultural Identity

Chapter 11: SOCIAL AND CULTURAL IDENTITY

CHAPTER OBJECTIVES When students finish this chapter, students should be able to: 11- 1. Explain how the dynamics of social identity influence our daily lives and consumer behavior.

11- 2. Describe how our family can shape our identity and often guide our consumption choices.

11- 3. Discuss how age-related life events shape our identity and often guide our consumption choices.

11- 4. Summarize how our ethnicity and race shape our identity and often guide our consumption choices.

11- 5. Explain how our religious and political beliefs affect how we think and often guide our consumption choices.

11- 6. Describe how “birds of a feather flock together” in place-based subcultures.

CHAPTER SUMMARY Explain how the dynamics of social identity influence our daily lives and consumer behavior.

We often think of ourselves and our identity through the lens of the groups and subcultures to which we belong. Each of us has a social identity comprised of unique identity-relevant behaviors, attitudes, and beliefs related to the groups from which we derive our sense of self.

Our social identity is shaped by tensions of autonomy and affiliation in how we relate to these different groups. Most people want to express their uniqueness as a person, but they also value the different parts of their social identities that connect them with others who have similar ones.

Consumers identify more closely with companies that allow them to pursue important social identities.

Describe how our family can shape our identity and often guide our consumption choices.

Marketers must understand how families make decisions. Spouses have different priorities and exert varying amounts of influence in terms of effort and power. Women who work outside the home tend to command more power in purchasing decisions, but, on the other hand, the significant growth in the number of stay-at-home fathers also influences this dynamic. Family members mutually construct a family identity that defines the household to both members and outsiders. Family rituals, narratives (stories the members tell about the family), and everyday interactions help families maintain their structure, maintain their family character (day-to-day characteristics of family life), and clarify members’ relationships to one another. The extended family used to be the most common family unit. It consists of three generations who live together, and it often includes grandparents, aunts, uncles, and cousins. However, demographic data tell us that this “ideal” image of the family is no longer realistic. The U.S. Census Bureau regards .

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any occupied housing unit as a household regardless of the relationships among the people who live there.

Discuss how age-related life events shape our identity and often guide our consumption choices.

An age cohort consists of people of similar ages who have similar experiences. Important cohorts today include Gen Z (kids who were born in the late 1990s to early 2000), Gen Y (born between 1986 and 2002), and baby boomers (born between 1946 and 1964). Each life stage brings with it certain needs and priorities. Marketers often target products and services that allow us to express the priorities and needs we encounter at such stages. The global youth market is massive. Because teens are interested in so many different products and have the resources to obtain them, many marketers avidly court them. Another key identity phase happens in the latter stages of consumers’ lives, often as they transition to retirement. Older adults (ages 65+) control more than 50 percent of discretionary income, and their net worth is five times that of the average consumer, yet marketers often overlook this important age cohort.

Summarize how our ethnicity and race shape our identity and often guide our consumption choices.

A person’s ethnic origins, racial identity, and religious background often are major components of their identity. African Americans, Hispanic Americans, and Asian Americans are the three most important ethnic/racial subcultures in the United States. Key issues to reach members of racial/ethnic subcultures are consumers’ degree of acculturation into mainstream U.S. society and the recognition of important cultural differences among subgroups (e.g., Puerto Ricans, Cubans, and Mexicans).

Explain how our religious and political beliefs affect how we think and often guide our consumption choices.

The quest for spirituality influences demand in product categories including books, music, and cinema. Although the impact of religious identification on consumer behavior is not clear, some differences among religious subcultures do emerge. Marketers need to consider the sensibilities of believers carefully when they use religious symbolism to appeal to members of different denominations. The same is true for political beliefs that often link in people’s minds to certain products or services they will seek out or avoid.

Describe how “birds of a feather flock together” in place-based subcultures.

Geodemography refers to analytical techniques that combine data on consumer expenditures and other socioeconomic factors with geographic information about the areas in which people live to identify consumers who share common consumption patterns. Researchers base this approach on the common assumption that “birds of a feather flock together.” Marketers can increase the efficiency of their messages when they focus on the similarities among consumers who choose to live in the same place.

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CHAPTER OUTLINE

I.

The Dynamics of Social Identity A. Facets of Social and Cultural Identity A Subculture is a group whose members share significant beliefs and common preferences.

B. The Dynamics of Identity Each of us has a social identity comprised of unique identity-relevant behaviors, attitudes, and beliefs related to the groups form which we derive our sense of self.

Each of these social identities is also tied to an emotion profile, which when activated, can influence which emotions we think are appropriate to exhibit or to use in our decision-making.

Our social identity is shaped by the tension between autonomy and affiliation as we relate to these different groups. On one end, most of us value autonomy – that is, the ability to make decisions on our own, free from external influences. On the other end, our identity is also shaped by the groups to which we belong and with which we want to have affiliation.

C. Salient Identity Cues At its core, social identity involves comparing ourselves with others and making consumption decisions accordingly.

Certain identity mindsets can be activated when an identity cue is made salient or noticeable.

Some individuals exhibit stronger responses to symbols because the identity they activate is salient to them. But the concept of social identity priming reminds us that identities we hold can become salient.

D. Threats to Social Identity People respond to a social identity threat according to their self-construal, or the degree to which they perceive themselves as independent versus interdependent.

When our need for autonomy is greater than our need for affiliation, we tend to go against the grain. But this also depends on whether we use a convergent versus divergent style of thinking. A convergent style of thinking reflects a preference for more alignment between one’s identity and one’s choices. A divergent thinking style would lead to opposite effects: prompting local identity would engage a preference for the global brand and vice versa.

We can signal that we’re part of a group but still convey a unique identity within the group.

1. Are You with Me or Not? Do you think group identities don’t matter? Years of research on the minimal group paradigm demonstrate just how flimsy a connection can be and still make a difference. That’s one reason we tend to have an ingroup bias, or a bias toward things, or brand, that represent our ingroup and thereby satisfy our desire to connect with what feels like “home.”

The complex dynamics within and across social identities are also affected by a person’s social dominance orientation, or the extent to which a person .

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wants their ingroup to be superior to – and exercise power over – outgroups.

Organizations can try to boost identity synergy by aligning their appeals to the facets of identities that their target customers might have.

2. “There’s No Place Like Home” As we travel the globe, our sense of identity might change. Our travels may activate our sense of cultural distinctiveness or seeing ourselves as separate from the immediate cultural environment.

E. Intersectionality Every consumer possesses multiple social identities, and these social identity structures interact in fostering life experience. Intersectionality describes the ways in which these competing identities combine to form unique experiences.

1. The Societal Consequences of Identity-Based Treatment Our experience of the marketplace affects our sense of identity. There is a lot of evidence that inequal experiences have negative repercussions in consumers; send of identity.

Use Chapter Objective11-1 Here Use Key Terms subculture, social identity, emotion profiles, autonomy, affiliation, identity mindsets, social identity priming, social identity threat, convergent, divergent, minimal group paradigm, ingroup bias, social dominance orientation, identity synergy, cultural distinctiveness, and intersectionality Here Use Consumer Behavior Challenges 11-13 and 11-29 Here

II.

The Family A. The Meaning of Family Family members mutually construct a family identity that defines the household for both members and outsiders.

In this family network, consumption practices, or activities that involve consuming a product, play an essential role in structuring and defining the family as a unit as well as smaller groups within the family.

B. Going Nuclear? The Structure of Households Evolves The extended family used to be the most common family unit. It consists of three generations who live together, and it often includes grandparents, aunts, uncles, and cousins.

The nuclear family—a mother, a father, and one or more children—largely replaced the extended family, at least in U.S. society.

The U.S. Census Bureau regards any occupied housing unit as a household regardless of the relationships among the people who live there.

The family unit continues to evolve, and marketers need to challenge their .

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cherished assumptions: • Nearly half of all women between the ages of 25 and 29 have never been married, up from about a quarter of that age group in 1986.

The percentage of women of childbearing age and their partners who define themselves as voluntarily childless is on the rise.

• DINKs (double income, no kids) couples are better educated on average than are two-income couples with children.

• The number of couples who cohabitate (live together without being married) continues to increase.

• Circumstances such as divorce, the need for a breadwinner to live in a different place, and military service make it more common for family networks to be scattered geographically so family members need to work harder to maintain their connections with one another.

• Children are more likely to live at home after graduating from college rather than taking their own places. (Known as boomerang kids.)

• Many adults care for their own parents as well as for their children.

Middle-aged people are sometimes called the sandwich generation because they must support both the generation above them and the one below them.

C. The Family Life Cycle Given the fluidity of the family, it is useful to think about its life cycle. The family life cycle (FLC) combines trends in income and family composition with the changes these demands place on this income.

The FLC is a kind of life course model that accounts for life event experiences that create physical, social, and emotional demands and circumstances to which people must adapt.

The three primary factors that affect the FLC are: ▪ Ages of the household members ▪ Presence or absence of children in the home ▪ Ages of children if present.

The FLC changes as a function of sociocultural trends.

D. Parenting and Consumer Behavior Our parents’ own consumer behaviors and beliefs influence the way we interact with products and the marketplace. This material parenting shapes children’s behavior and can in fact shape materialism.

1. Parenting Styles Two important dimensions of parenting are emotional and behavioral.

Combining these two dimensions, we can identify four distinct parenting styles: • Authoritative parents have both restrictive and warm interactions with children.

• Neglecting parents are permissive but also display hostile tendencies.

• Indulgent parents are lenient, compliant, accepting, affirmative, and .

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•

nonpunitive in dealings with children.

Authoritarian parents are restrictive and display relatively more hostility.

Parenting styles help determine the consumer activity of children.

Parental yielding occurs when a parental decision maker “surrenders” to a child’s request. Yielding drives many product selections because about 90 percent of these requests are for a specific brand.

2. Parenting Teen Consumers As children get into their teens, parenting takes on a whole different form.

Adolescence is a difficult phase of life, a transition when autonomy motivations get stronger, and affiliation often shifts from family to other groups.

Research found that parental restrictiveness had the most positive impact on subsequent positive marketplace behaviors.

3. The Extended Family: Pets As of 2022, 70 percent of U.S. households own a pet, and Americans spend more than $100 billion per year on pet food, toys, and other supplies. In addition to keeping us company and doing clever tricks, animal companions serve an important role. Consumers often choose a pet based on their own personality characteristics, and they tend to treat pets as family members. Pets may become central to consumers’ identity projects.

Use Chapter Objective11-2 Here Use Key Terms family identity, extended family, nuclear family, household, voluntarily childless, KINKs, cohabitate, boomerang kids, sandwich generation, family life cycle (FLC), material parenting, authoritative parents, neglecting parents, indulgent parents, authoritarian parents, and parental yielding Here Use Review Questions 11-5, 11-6, and 11-7 Here Use Consumer Behavior Challenges 11-13, 11-14, 11-20, 11-21, 11-24, 11-29, 11-30, 11-32, 11-33, and 11-34 Here

III.

Age and Generations Each life stage brings with it certain needs and priorities. Marketers often target products and services that allow us to express the priorities and needs we encounter at such stages.

A. Teenagers The global youth market is massive. It represents about $259 billion in spending power annually.

Teen consumers have many needs. Product usage is a significant medium that lets them satisfy these needs. .

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Teenagers in every culture grapple with fundamental developmental issues when they transition from childhood to adult.

The Saatchi & Saatchi advertising agency identified four basic conflicts common to all teens: • Autonomy versus belonging • Rebellion versus conformity • Idealism versus pragmatism • Narcissism versus intimacy B. “Tweens” We call kids ages 8 to 14 tweens because they are “between childhood and adolescence, and they exhibit characteristics of both age groups.

They spend about $44 billion annually.

Many social, economic, and media trends shape tweens’ identity.

Purpose matters, and they value brands that stand for something – and, importantly, that they view as authentic.

C. Consumers Aging Gracefully: Retirement and Beyond Another key identity phase happens in the latter stages of consumers’ lives, often as they transition to retirement. We can already see the effects of the mature market today. Older adults (ages 65+) control more than 50 percent of discretionary income, and their net worth is five times that of the average citizen.

When people retire, they often experience a consumer identity renaissance; this refers to the redefinition process people undergo when they retire. A research project identified two different types of identity renaissance: revived or emergent.

In the last stages of the family life cycle, older consumers often move from autonomy to needing more assistance in tasks.

D. Age Cohorts An age cohort consists of people of similar ages who have similar experiences.

Traditional age cohorts are: • The Interbellum Generation—People born at the beginning of the 20th century.

• The Silent Generation—People born between the two world wars.

• The War Baby Generation—People born during World War II. • The Baby Boom Generation—People born between 1946 and 1964.

• Generation X—People born between 1965 and 1985.

• Generation Y—People born between 1986 and 2002.

• Generation Z—People born 2003 and later.

1. Gen Z Gen Z describes kids who were born in the late 1990s to early 2000s. This is the first generation of the 21st century; 55 percent are Caucasian, 24 percent are Hispanic, 14 percent are African American, and 4 percent are Asian. They are digital natives who spend a lot of time online.

2. Gen Y Gen Y was born between 1986 and 2002. Also known as millennials and echo boomers, this generation is hopeful about the future. They make up nearly one-quarter of the U.S. population, and they spend $170 billion a year .

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of their own and their parents’ money. Their lifestyle of connexity is that of “jugglers” who value being both footloose and connected at the same time.

Three major forces have shaped their experience: • Economy • Globalization • Social media Unlike their parents or older siblings, Gen Yers tend to hold relatively traditional values, and they prefer to fit in rather than rebel.

3. Gen X The Gen X age subculture consists of 46 million Americans who were born between 1965 and 1985. Some have called them “slackers” or “baby busters” because of their supposed alienation and laziness, 4. The Mature Market: Boomers & Seniors The baby boomer age subculture consists of people whose parents established families following the end of World War II and during the 1950s when the peacetime economy was strong and stable. This generation is much more active and physically fit than its predecessors.

Demographers distinguish between two subgroups of Baby Boomers: “Leading-edge” boomers, born between 1946 and 1955, grew up during the Vietnam War and Civil Rights eras. “Trailing-edge” boomers, who were born between 1956 and 1964, came of age after Vietnam and the Watergate scandal.

They are going to be an important segment for a long time.

Use Chapter Objective11-3 Here Use Key Terms tweens, mature market, consumer identity renaissance, age cohort, Gen Y, millennials, echo boomers, connexity, Gen X, and baby boomer Here Use Review Questions 11-8, 11-9, 11-10, and 11-11 Here Use Consumer Behavior Challenges 11-14, 11-25, 11-26, 11-27, 11-30, 11-36, and 11-37 Here

IV.

Ethnic and Racial Identities A. Ethnic and Racial Identity The degree to which we pay attention to our membership to a given group is a function of that groups’ salience in our mind. This sometimes comes from the situation we are in but also from the degree to which we identify with the group.

Ethnic identification is the extent to which we are emotionally attached to our own ethnic group and to which we find our membership in that group to be a significant part of our identity.

Regardless of our own racial or ethnic identities, many modern consumers love to experiment with the products of other cultures.

Researchers developed a diversity seeking scale that measures a person’s .

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propensity to seek out cultural diversity in products, services, and experiences.

B. Ethnic and Racial Diversity in the U.S. The rapidly growing diversity of U.S. culture is one of the most important drivers of change in this century. The number of people self-reporting more than one race or ethnicity is also growing.

The Census Bureau predicts that by 2050, people who identify themselves as multiracial will make up almost 4 percent of the U.S. population.

1. Hispanic/Latinx Americans Nearly one in five Americans is Hispanic/Latinx, and the U.S. is one of the largest Spanish-speaking countries.

It’s important to note that being Hispanic is an ethnicity, not a race.

The umbrella term Hispanic describes people of many different backgrounds.

Nearly 60 percent of Hispanic Americans are of Mexican descent. The next largest group, Puerto Ricans, make up just less than 10 percent of Hispanics.

Hispanics are now the nation’s second-largest consumer market after white non-Hispanics, with $1.7 trillion in purchasing power. They are also geographically concentrated.

Black Americans still face racial stigma in the marketplace; they are often denied access to financing or treated differently based on their skin color.

They often adjust to this stigma by developing strategies of respectability to make their lives more tolerable. They engage in normative respectability: displaying consumption choices that associate them with desired social identities that are perceived as “respectable.” Or instead, they might engage in oppositional respectability: displaying consumption choices that enhance or elevate their blackness.

2. Asian Americans Asian Americans are the fastest-growing racial group in the nation.

The term Asian refers to 20 national origins, with Chinese being the largest and Filipino and Japanese second and third, respectively.

C. Showing Respect: Ethnic and Racial Symbols Ethnic and racial symbols are especially laden with cultural connections and relevance to the groups for which they are sacred.

Marketers’ shorthand symbolism became taboo with crude and unflattering images.

As the civil rights movement gave more power to minority groups and their rising economic status began to command marketers’ respect, these negative stereotypes began to disappear.

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Use Chapter Objective 11-4 Here Use Key Terms ethnic identification, diversity seeking scale, Hispanic, racial stigma, respectability, normative respectability, and oppositional respectability Here Use Review Questions 11-1, 11-2, and 11-3 Here Use Consumer Behavior Challenges 11-12 and 11-19 Here

V.

Religious and Political Identity People who are religious celebrate and adopt cherished traditions and holidays through acts of consumption. The way people live their religion often depends on whether that religion is dominant in the place where they live, whether it is in the minority, or whether it is diasporic, or recently brought in and practiced by a small number of people.

A. Religion and Consumption Religion plays an important role in consumer behavior. Religious beliefs shape consumption choices as they sometimes determine what we will not buy.

Megachurches are home to thousands of members.

B. Marketing to Muslims Although Muslims only comprise about one percent of the total U.S. population, analysts estimate that this number will more than double by 2050.

1. Halal Foods Mindful of the success of kosher certification, some Muslims recognize that halal foods, or foods permissible under the lases of Islam, also may appeal to mainstream consumers.

Halal as a descriptor is being used for more and more commodities, services, and activities.

2. Modest Fashion The veil, an essential element of the Islam religion, is also often a fashion symbol.

There is growing interest in clothing styles that are not as revealing as many current outfits. This trend for modest fashion is now a $250 billion global industry.

C. Political Identity Political orientation affects what we buy. Political values are an important driver of consumer behavior because in our society political orientation is an essential ingredient of one’s identity. In the U.S., these differences run deep because people are “brand loyal” to their party.

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Use Chapter Objective11-5 Here Use Key Terms diasporic, megachurches, halal, modest fashion, and political orientation, Here Use Review Question 11-4 Here Use Consumer Behavior Challenges 11-15, 11-16, 11-18, 11-22, 11-23, and 11-31 Here

VI.

Community (Geographic and Place-Based Subcultures) A. Geodiversity Geodemography refers to analytical techniques that combine data on consumer expenditures and other socioeconomic factors with geographic information about the areas in which people live to identify consumers who share common consumption patterns.

Whether someone lives in a city – that is, their extent of urban identification – is having an increasingly large effect on the identities people pursue, the political issues people endorse, and the consumption activities people engage in.

An identity we might call “the global citizen” refers to a person who values diverse viewpoints and new experiences that are not restricted to their physical place of residence. This tendency is sometimes called cosmopolitan.

B. Diversity in the U.S. The U.S. is very diverse. Political attitudes may be quite different, and it’s likely there are a lot of new product labels and brands to learn. Even though we are all residents of the U.S., the reality is that our everyday experiences depend on just where we call home in this huge country.

C. Birds of a Feather Flock Together: Grouping Consumers by Zip Codes Marketers who apply geodemographic techniques that use large data sets on where people live and what they consumer assume that “birds of a feather flock together” – people who have similar needs and tastes tend to lie near one another, so it should be possible to locate “pockets” of like-minded people whom marketers can reach more economically by direct mail and other methods.

Marketers tailor their efforts to recognize these geographical differences using Nielsen’s PRIZM system. This system classifies every U.S. zip code into 1 of 66 categories. This helps marketers go beyond simple product-category purchase data and demographics to really understand a market.

.

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Use Chapter Objective11-6 Here Use Key Terms geodemography. Urban identification, cosmopolitan and PRIZM Here Use Consumer Behavior Challenges 11-17 and 11-35 Here

End-of-Chapter Support Material

REVIEW QUESTIONS

11-1.

Why is it difficult to identify consumers in terms of their ethnic subculture membership?

The United States is heterogeneous, so it is difficult to separate subcultures from mainstream society. Further, many people identify with two or more races, refusing to describe themselves as only white, black, Asian, Korean, Samoan, or one of the other categories listed. (5 minutes, Chapter Objective 11-4, AACSB: Diverse and Multicultural Work Environments)

11-2.

Why are Hispanic American consumers attractive to marketers?

The Hispanic subculture is a sleeping giant that until recently many U.S. marketers largely ignored. The growth and increasing affluence of this group has now made it impossible to overlook, and major corporations avidly court Hispanic consumers.

Marketers especially like the fact that Hispanics tend to be brand loyal. Hispanics who strongly identify with their ethnic origin are more likely to seek Hispanic vendors, to be loyal to brands used by family and friends, and to be influenced by Hispanic media. This segment is also highly concentrated geographically by country of origin, which makes them relatively easy to reach. (15 minutes, Chapter Objective 11-4, AACSB: Diverse and Multicultural Work Environments)

11-3.

Why are Asian Americans an attractive market segment? Why can they be difficult for marketers to reach?

Asian Americans make up the fastest-growing population group. Despite its potential, this group is hard to market to because it actually is composed of subgroups that are culturally diverse and speak many different languages and dialects. The term Asian refers to 20 national origins, with Chinese being the largest and Filipino and Japanese .

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second and third, respectively. (10 minutes, Chapter Objective 11-4, AACSB: Diverse and Multicultural Work Environments 11-4.

How do religious subcultures affect consumption decisions?

In some cases, dietary or dress requirements create demand products, and these items then may gain in popularity among other groups. For example, less than one-third of the 6 million consumers who buy kosher products are Jewish. Seventh-Day Adventists and Muslims have very similar dietary requirements, and other people simply believe that kosher food is of higher quality. That is why some of the nation’s largest manufacturers get involved. About two-thirds of Pepperidge Farm’s products, for example, are kosher.

For either personal or religious reasons, a growing number of women are looking for modest fashion – now a $250 billion global industry. (10 minutes, Chapter Objective 115, AACSB: Diverse and Multicultural Work Environments) 11-5.

What is a nuclear family, and how is it different from an extended family?

The extended family used to be the most common family unit. It consists of three generations who live together, and it often includes grandparents, aunts, uncles, and cousins. The nuclear family—a mother, a father, and one or more children largely replaced the extended family, at least in U.S. society. (5 minutes, Chapter Objective 11-2, AACSB: Diverse and Multicultural Work Environments) 11-6.

What are boomerang kids?

Children are more likely to live at home after graduating from college rather than taking their own places. Demographers call these returnees boomerang kids (you throw them out … they keep coming back). In today’s shrinking job market, many young people are forced to redefine the assumption that college graduation automatically means living on their own. (5 minutes, Chapter Objective 11-2, AACSB: Diverse and Multicultural Work Environments) 11-7.

What is the FLC, and why is it important to marketers?

Because they recognize that family needs and expenditures change over time, marketers apply the family life cycle (FLC) concept to segment households. The FLC combine trends in income and family composition with the changes these demands place on this income. As we age, our preferences and needs for products and activities tend to change.

Twenty-somethings spend less than average on most products and services because their households are small and their incomes are low. Income levels tend to rise (at least until retirement), so that people can afford more over time. Older consumers spend more per capita on luxury items such as gourmet foods and upscale home furnishings. In addition, we don’t need to repeat many purchases we make when we start out. For example, we tend to accumulate durable goods such as large appliances and replace them only as necessary. Over the years, researchers have proposed several models to describe family life-cycle stages, but with limited effect because most failed to take into account such .

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important social trends as the changing role of women, the acceleration of alternative lifestyles, childless and delayed-child marriages, and single-parent households. (5 minutes, Chapter Objective 11-2, AACSB: Diverse and Multicultural Work Environments), 11-8.

What is an age cohort, and why is it of interest to marketers?

An age cohort consists of people of similar ages who have undergone similar experiences. They share many common memories about cultural heroes (e.g., John Wayne versus Brad Pitt, important historical events (e.g., World War II versus the 2001 terrorist attacks), and so on. Although there is no universally accepted way to divide people into age cohorts, each of us seems to have a good idea of what we mean when we refer to “my generation.” (5 minutes, Chapter Objective 11-3, AACSB: Diverse and Multicultural Work Environments) 11-9.

How are Gen Yers different from their older brothers and sisters?

Unlike their parents or older siblings, Gen Yers tend to hold relatively traditional values and they believe in the value of fitting in rather than rebelling. Their acculturation agents (as we discussed in the previous chapter) stress teamwork—team teaching, team grading, collaborative sports, community service, service learning, and student juries. Violent crime among teenagers is down 60 to 70 percent. The use of tobacco and alcohol are at all-time lows. So is teen pregnancy. Five out of ten echo boomers say they trust the government, and virtually all of them trust Mom and Dad. (5 minutes, Chapter Objective 11-3, AACSB: Diverse and Multicultural Work Environments) 11-10. What are tweens, and why are so many marketers interested in them?

Marketers use the term tweens to describe the children aged 8 to 14 who spend $44 billion a year. Tweens are “between” childhood and adolescence and they exhibit characteristics of both age groups. (5 minutes, Chapter Objective 11-3, AACSB: Diverse and Multicultural Work Environments) 11-11. What are some business categories that stand to benefit most from the increasing affluence and vitality of the senior market?

Travel and hospitality, car sales and rentals, apparel, banking, and others. (3 minutes, Chapter Objective 11-3, AACSB: Diverse and Multicultural Work Environments)

CONSUMER BEHAVIOR CHALLENGE DISCUSS

11-12. Adidas provoked outrage when the company posted a photo of a new design, the JS Roundhouse Mids, on its Facebook page. The shoes come with bright orange shackles .

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and the tagline “Got a sneaker game so hot you lock your kicks to your ankles?” Many users complained that this image is highly offensive to African Americans because it evokes imagery of slavery and chain gangs. The company claimed the design had nothing to do with these issues, but the damage was done. Do you agree with Nike? If not, how might you have handled this differently?

Student responses to this question will vary. Students should consider how companies should respond to marketing that is offensive. (30 minutes, Chapter Objective 11-4, AACSB: Reflective Thinking, Ethical Understanding and Reasoning) 11-13. The average U.S. teenager spends well more than eight hours a day in front of a screen, whether smartphone, PC, TV, or tablet. One study reported increasing physical isolation among internet users; it created a controversy and drew angry complaints from some users who insisted that time they spent online did not detract from their social relationships. However, the researchers said they had now gathered further evidence showing that internet use has lowered the amount of time people spend socializing with friends and even sleeping. According to the study, an hour of time spent using the internet reduces face-to-face contact with friends, coworkers, and family by 23.5 minutes; lowers the amount of time spent watching television by 10 minutes; and reduces sleep time by 8.5 minutes. What’s your perspective on this issue? Does increasing use of the internet have positive or negative implications for interpersonal relationships in our society?

Student responses to this question will vary dramatically. (30 minutes, Chapter Objectives 11-1 and 11-2, AACSB: Reflective Thinking, Ethical Understanding and Reasoning)

11-14. More than 16 million millennial women are now mothers, and that number grows by more than a million every year. These new parents demand innovations in child-rearing to match their experiences in other realms of their lives. These “parennials” are information-hungry; they never stop researching the best things to buy for their children.

There are numerous resources for them to learn about parenting, such as chat rooms like Wonder Weeks and WebMDBaby. Many parennials, accustomed to chronicling every great dish they order in a restaurant, give their children YouTube channels from the first sonogram and hashtags when they’re born.127 What is the next “killer app” for young parennials?

Students have an opportunity to respond creatively. (30 minutes, Chapter Objectives 11-2 and 11-3, AACSB: Reflective Thinking, Ethical Understanding and Reasoning) 11-15. Among Facebook’s various problems over the last few years is that some of the country’s leading employers placed recruitment ads on the platform that were limited to particular age groups. Facebook’s ability to target very specific profiles has raised concerns about potential age discrimination in hiring. Some companies argue that this .

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strategy is permissible because targeting older people for entry-level jobs would be a waste of money. For example, Goldman Sachs said that while about one-quarter of those who click on job ads are over 65, almost none go on to apply for an analyst job.

What’s your take on this issue—is social media’s ability to finely target very specific consumer groups a plus or a minus?

Student responses to this question will vary dramatically. (30 minutes, Chapter Objective 11-4, AACSB: Reflective Thinking, Ethical Understanding and Reasoning) 11-16. Several major advertisers including Corona beer have come under fire recently for showing allegedly racist ads that favor white people over black people. In a Facebook ad for Dove body wash, a black woman removes her brown shirt and the ad then reveals a white woman in a light shirt (Dove later apologized). This is not a new problem: A soap ad that ran in the early 1900s featured a white child asking a black child, “Why doesn’t your mamma wash you with Fairy soap?” In 2017 the skin care company Nivea ran a deodorant ad that read, “White is purity.” White supremacists on the internet loved it In what some have labeled the most racist ad ever made, a 2016 commercial for the Chinese company Qiaobi’s laundry detergent shows an Asian woman who shoves a detergent pod into a black man’s mouth and puts him in a washing machine, from which he emerges as a light-skinned Asian. While you would think these ads are screened for such insulting content, apparently many still make it through. Should advertisements be more thoroughly screened, or are people just overreacting to these attempts at humor?

How might the system be changed to avoid these blunders?

Student responses will vary. The question presents a good platform from which to discuss the ever-evolving concept of acceptability in advertising. As society’s views and norms change, so must advertising practices. (15 minutes, Chapter Objective 11-4, AACSB: Diverse and Multicultural Work Environments) 11-17. Geodemographic techniques assume that people who live in the same neighborhood have other things in common as well. Why do they make this assumption, and how accurate is it?

Geodemography refers to analytical techniques that combine data on consumer expenditures and other socioeconomic factors with geographic information about the areas in which people live to identify consumers who share common consumption patterns. Researchers base this approach on the common assumption that “birds of a feather flock together”—people who have similar needs and tastes also tend to live near one another, so it should be possible to locate “pockets” of like-minded people whom marketers can reach more economically by direct mail and other methods. Residents of different clusters display marked differences in their consumption of products. One popular clustering technique is Nielsen’s PRIZM system. This system classifies every U.S. Zip Code into 1 of 66 categories, ranging from the most affluent “Blue-Blood Estates” to the least well-off “Public Assistance.” Although consumers in two different clusters may purchase a product at an equivalent rate, these similarities end when we take their other purchases into account. These differences highlight the importance of going beyond .

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simple product-category purchase data and demographics to really understand a market.

(10 minutes, Chapter Objective 11-6, AACSB: Diverse and Multicultural Work Environments) 11-18. Should members of a religious group adapt marketing techniques that manufacturers customarily use to increase market share for their secular products? Why or why not?

Most students will probably say that some level of marketing used by churches and religious groups is fine. After all, without any kind of promotion, how are the members of an organization supposed to be informed about the services that a church offers?

Worshippers and potential worshippers have needs and desires, just like any consumers in any consumer context. So, it seems fitting that churches attempt to meet the needs of the members of their congregation. However, some students will probably raise the issue that there is a line in marketing something like religion. A Starbucks outlet in a church?

It has happened. (10 minutes, Chapter Objective 11-5, AACSB: Diverse and Multicultural Work Environments) 11-19. Years ago R. J. Reynolds announced plans to test market a menthol cigarette called Uptown specifically to black consumers. According to the company, about 70 percent of black smokers prefer menthol, more than twice the average rate. After market research showed that blacks tend to open cigarette packs from the bottom, the company decided to pack Uptowns with the filters facing down. Reynolds canceled its plans after private health groups and government officials protested. Does a company have the right to exploit a subculture’s special characteristics, especially to increase sales of a harmful product such as cigarettes? What about the argument that virtually every business that follows the marketing concept designs a product to meet the needs and tastes of a preselected segment?

The instructor should anticipate a high level of interest and involvement with the issues represented in the RJR case. As in the case of targeting gays and the handicapped, there is likely to be a difference of opinion. It would be particularly interesting to hear the perspectives of both white and black students on this specific case. Generally, students should be able to think about and critically examine the issues regarding segmentation (on any basis) in order to meet the unique needs and wants of consumers and to increase overall sales of the product. (20 minutes, Chapter Objective 11-4 AACSB: Diverse and Multicultural Work Environments and Ethical Understanding and Reasoning) 11-20. Discuss the pros and cons of the voluntarily childless movement.

The percentage of women of childbearing age who define themselves as voluntarily childless is on the rise. Twenty percent of women ages 40 to 44 have no children, double the level of 30 years ago. Childless couples are an attractive market segment for some companies (but obviously not for others, such as Gerber Baby Food). So-called DINKS (double income, no kids) couples are better educated on average than are twoincome couples with children. According to the U.S. Census Bureau, 30 percent of childless couples consist of two college graduates, compared with 17 percent of those with kids. Many childless couples feel snubbed by a child-oriented society. In recent .

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years they formed networking organizations such as Childfree by Choice to support this lifestyle decision. (5 minutes, Chapter Objective 11-2, AACSB: Diverse and Multicultural Work Environments) 11-21. When they identify and target newly divorced couples, do you think marketers exploit these couples’ situations? Are there instances in which you think marketers may actually be helpful to them? Support your answers with examples.

Responses will vary by student but should address the family life cycle. As people move through these life stages, we observe significant changes in expenditures in leisure, food, durables, and services, even after we adjust the figures to reflect changes in income. We simply attribute some of these changes to variations in functional needs, whereas others reflect deeper motivations as we transition from one role to another. For example, researchers find that new mothers undergo profound changes in self-concept during pregnancy and after delivery; these changes influence the types of products they consume to reflect their new identities. The same would be true of those who divorce. (5 minutes, Chapter Objective 11-2, AACSB: Diverse and Multicultural Work Environments) 11-22. Born-again Christian groups have been instrumental in organizing boycotts of products advertised on shows they find objectionable, especially those that they feel undermine family values. Church leaders can encourage consumption but, more importantly, they can also discourage it—sometimes with powerful effects. The Disney Corporation discovered how effective these movements can be when the Southern Baptist Convention voted to persuade all its members to boycott Disney’s operations. The church instituted its anti-Mickey rebellion to protest the “Gay Days” at the theme parks and advocated a view that Disney had a radical homosexual agenda that it promoted through its broadcasts. Soon other organizations joined the cause, including the American Family Association, the General Council of the Assemblies of God, the Congregational Holiness Church, the Catholic League for Religious and Civil Rights, and the Free Will Baptists. The fallout from the boycott was significant; Disney was forced to lay off 4,000 employees. Do religious groups have a right or a responsibility to dictate what advertising a network should carry?

As with many of the previous exercises, the answer to this question is a matter of individual opinion. As always, the instructor should encourage students to consider both sides of the argument and develop examples or cases to defend both positions, regardless of their personal opinions. (10 minutes, Chapter Objective 11-5, AACSB: Diverse and Multicultural Work Environments and Ethical Understanding and Reasoning) 11-23. Religious symbolism appears in advertising, even though some people object to this practice. For example, a French Volkswagen ad for the relaunch of the Golf model showed a modern version of the Last Supper with the tagline, “Let us rejoice, my friends, for a new Golf has been born.” A group of clergy in France sued the company and the ad had to be removed from 10,000 billboards. One of the bishops involved in the suit said, “Advertising experts have told us that ads aim for the sacred in order to shock, because using sex does not work anymore.” Do you agree? Should religion be used to market products? Do you find this strategy effective or offensive? When and where is .

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this appropriate, if at all?

In answering this question, students may come up with numerous related incidents to illustrate the impact of highlighting religion in popular culture and advertising. One interesting approach to this issue (and related issues of offenses based on any other group or subculture) might be to suggest that there should be no censure of such material at all; that in a society where free speech is a core value, such material should not need to be censured or regulated. If indeed companies cross the line, then the market should take care of itself by a decrease in demand for products produced by such companies. (15 minutes, Chapter Objective 11-5, AACSB: Diverse and Multicultural Work Environments and Ethical Understanding and Reasoning) 11-24. This chapter discussed the dramatic changes in family structure today. The reality is that many other types of families continue to grow rapidly as well. Indeed, some experts argue that as traditional family living arrangements wane, we place even greater emphasis on siblings, close friends, and other relatives who provide companionship and social support. Some people join intentional families, groups of unrelated people who meet regularly for meals and who spend holidays together. Indeed, for some the act of meeting together to consume homemade food plays a central role in defining family: It is a symbolic way to separate a family unit from other social groups by allowing the cook(s) to personalize the meal and express affection via the effort that went into preparing the feast. What evidence do you find of the impact of nontraditional family structures? How will these alternative lifestyles change the way we think about consumer behavior?

Responses will vary by student. The response should recognize the concept of extended family and how the notion of the traditional family unit continues to evolve. The response may consider divorce, voluntary childlessness, and family life cycle. (10 minutes, Chapter Objective 11-2, AACSB: Multicultural and Diversity) 11-25. This chapter describes members of Gen Y as much more traditional and team-oriented than their older brothers and sisters. Do you agree?

Given that the traditional college students of today fall into the Gen Y category, this should be an interesting discussion. Do students want to see themselves as “traditional”?

If this is a good thing, then they are likely to agree. However, even if this is true, it will be interesting to see if students will want to “’fess up.” (15 minutes, Chapter Objective 11-3, AACSB: Diverse and Multicultural Work Environments) 11-26. Many parents worry about the time their kids spend online, but this activity may actually be good for them. A study by the MacArthur Foundation claims that surfers gain valuable skills to prepare them for the future. The study also finds that concerns about online predators are overblown; most kids socialize with friends they know from other situations like school or camp. What is your take on this? Are concerns about excessive web surfing unjustified?

.

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Students will likely feel that the concern is overblown. Regardless, the use of the Internet for young people is important for marketers targeting this group. (10 minutes, Chapter Objective 11-3, AACSB: Diverse and Multicultural Work Environments) 11-27. What are some of the positives and negatives of targeting college students? Identify some specific marketing strategies that you feel have been either successful or unsuccessful at appealing to this segment. What characteristics distinguish the successes from the failures?

According to material found in the chapter, advertisers spend approximately $100 million per year to try to influence this $20 billion market. As noted, the average college student has approximately $200 in discretionary funds each month beyond their basic needs. The marketers would certainly like to capture those dollars. Advantages of pursuing this market include the facts that they have money to spend and they are willing to try new products. Many, however, are inexperienced buyers, are hard to reach through traditional media, and tend to be specialized in the way they receive their information.

As noted in the chapter, one unique way of reaching the college student is the use of sampler boxes and wall media. Students should be challenged to think of other media forms and strategies that might prove to be successful with their market. This question usually results in a lively discussion. (15 minutes, Chapter Objective 11-3, AACSB: Diverse and Multicultural Work Environments) APPLY 11-28. Locate current examples of marketing stimuli that depend on an ethnic or religious stereotype to communicate a message. How effective are these appeals?

Students are likely to identify beer companies for their practice of ethnic segmentation in advertising. To target Hispanic Americans or African Americans, for example, advertisers are employing well-known Hispanic and African American personalities (e.g., movie stars, professional athletes, etc.) to promote their products. It is likely that these appeals are effective when the consumer feels a sense of identity or affinity with the spokesperson. (25 minutes, Chapter Objectives 11-4 and 11-5, AACSB: Diverse and Multicultural Work Environments) 11-29. We can think of college students who live away from home as having a substitute “family.” Whether you live with your parents, with a spouse, or with other students, how are decisions made in your college residence “family”? Do some people take on the role of mother, father, or child? Give a specific example of a decision that had to be made and the roles members played.

Students will likely find this an interesting challenge to reflect on their own buying decisions. (25 minutes, Chapter Objectives 11-1 and 11-2, AACSB: Diverse and Multicultural Work Environments) .

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11-30. Arrange to interview two couples, one married fewer than 5 years and one married for more than 20 years. Prepare a response form that lists five product categories— groceries, furniture, appliances, vacations, and automobiles—and ask each spouse to indicate, without consulting the other, whether purchases in each category are made by joint or unilateral decisions and to indicate whether the unilateral decisions are made by the husband or the wife. Compare each couple’s responses for agreement between husbands and wives relative to who makes the decisions and compare both couples’ overall responses for differences relative to the number of joint versus unilateral decisions. Report your findings and conclusions.

The reports prepared by students will differ based on their unique findings. (25 minutes,

Chapter Objectives 11-2 and 11-3, AACSB: Diverse and Multicultural Work Environments)

11-31. To understand the power of ethnic stereotypes, conduct your own poll. For a set of ethnic groups, ask people to anonymously provide attributes (including personality traits and products) most likely to characterize each group using the technique of free association.

How much agreement do you obtain across respondents? To what extent do the characteristics derive from or reflect negative stereotypes? Compare the associations for an ethnic group between actual members of that group and nonmembers.

Students should be encouraged to conduct their own research for this exercise and many others. This may be a good time for the instructor to emphasize the importance and value of market and consumer research efforts. (45 minutes, Chapter Objective 11-4, AACSB: Diverse and Multicultural Work Environments and Analytical Skills) 11-32. Observe the interactions between parents and children in the cereal section of a local grocery store (remember to take earplugs with you). Prepare a report on the number of children who expressed preferences, how they expressed their preferences, and how parents responded, including the number who purchased the child’s choice.

The report prepared by students will differ based on their experience in data collection.

(45 minutes, Chapter Objective 11-2, AACSB: Diverse and Multicultural Work Environments and Analytic Skills) 11-33. Select a product category and, using the life cycle stages this chapter describes, list the variables likely to affect a purchase decision for the product by consumers in each stage of the cycle.

A life-cycle approach to the study of the family assumes that pivotal events alter role relationships and trigger new stages of life that alter our priorities and brand loyalties.

Students will have different responses based on the examples chosen. (10 minutes, Chapter Objective 11-2 AACSB: Analytic Skills) 11-34. Consider three important changes in the modern family structure. For each, find an .

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example of a marketer who seems to be conscious of this change in its product communications, retailing innovations, or other aspects of the marketing mix. If possible, also try to find examples of marketers who have failed to keep up with these developments.

Over the years, researchers have proposed several models to describe family life-cycle stages, but with limited effect because most failed to take into account such important social trends as the changing role of women, the acceleration of alternative lifestyles, childless and delayed-child marriages, and single-parent households. There are four variables that address these changes: age, marital status, the presence or absence of children in the home, and the age of the children, if present. The examples students choose will vary, and will their indication of how marketers keep up, or fail to keep up, with these developments. (10 minutes, Chapter Objective 11-2, AACSB: Reflective Thinking) 11-35. One study asked young people in the United States and the Netherlands to write essays about what is “cool” and “uncool” and to create visual collages that represent what it means to be cool. The researchers found that cool has multiple meanings to kids in these two cultures. Some of the common dimensions include having charisma, being in control, and being a bit aloof. Many of the respondents also agreed that being cool is a moving target: The harder you try to be cool, the more uncool you are! Here are some of their actual responses: • “Cool means being relaxed, to nonchalantly be the boss of every situation, and to radiate that” (Dutch female) • “Cool is the perception from others that you’ve got ‘something’ which is macho, trendy, hip, etc.” (Dutch male) • “Cool has something standoffish and at the same time, attractive” (Dutch male) “Being different, but not too different. Doing your own thing, and standing out, without looking desperate while you’re doing it” (American male) • “When you are sitting on a terrace in summer, you see those machos walk by, you know, with their mobile [phones] and their sunglasses. I always think, ‘Oh please, come back to earth!’ These guys only want to impress. That is just so uncool” (Dutch female) • “When a person thinks he is cool, he is absolutely uncool” (Dutch female) • “To be cool we have to make sure we measure up to it. We have to create an identity for ourselves that mirrors what we see in magazines, on TV, and with what we hear on our stereos” (American male) Replicate this study in your area. Recruit a group of teenagers to construct individual collages that represent what they feel is “cool.” Analyze their choices—what patterns do you see?

Responses will vary. (1 hour, Chapter Objective 11-6, AACSB: Reflective Thinking) 11-36. One pair of researchers took an in-depth look at how 13 and 14 year old integrate the computer into their lives, and how they use it to express their cyberidentities. These tweens have limited mobility in real life (too young to drive), so they use the computer to transport themselves to other places and modes of being. The researchers explored the .

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metaphors these kids use when they think about their computers. For some, the PC is a “fraternity house” where they can socialize; it also can be a “carnival;” where they play games and an “external brain” that helps with homework. Interview some tweens about their online behaviors. How do they think about their digital devices? What role do they play in their lives?

Student responses will vary given their level of involvement or attachment to their electronic devices. (1 hour, Chapter Objective 11-3, AACSB: Reflective Thinking) 11-37. Locate one or more consumers (perhaps family members) who have emigrated from another country. Interview them about how they adapted to their host culture. What changes did they make in their consumption practices over time?

The class will be able to discuss this question in more depth if someone who personally knows an immigrant conducts this interview. (30 minutes, Chapter Objectives 11-1 and 11-4, AACSB: Diverse and Multicultural Work Environments and Ethical Understanding and Reasoning) 11-38. Interview some retired people. How are they reconstructing their identities? What opportunities do their desires present for marketers?

People can reconstruct identity by focusing on revitalizing a previous identity (revived) or by pursuing a new one (emergent). In either case, marketers can provide the products and brands that will help “build” and reflect the identity in question. (90 minutes, Chapter Objective 11-3, AACSB: Diverse and Multicultural Work Environments

CASE STUDY TEACHING NOTES Chapter 11 Case Study: Hyundai’s OKAY Campaign: Driving Towards Diverse Markets Summary of Case Hyundai has developed an ad campaign for its electric vehicles that attempts to appeal directly to historically underrepresented communities of color, most specifically the Black community. In the early stages of EV and hybrid car development, ads have almost exclusively targeted middleaged, college-educated white males. The Hyundai OKAY campaign is a notable departure from that historical trend and perhaps a sign of things to come.

Suggestions for Presentation You may wish to encourage students to review ads online and in social media with a focus on the actors, models, and language that is present in those ads. Do they notice any trends in race, ethnicity, gender, socioeconomic status, etc.? In what way is the Hyundai OKAY campaign similar and different?

Suggested Answers for Discussion Questions

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CS 11-1 Who is the target market for the OKAY Hyundai ad campaign? Include specific demographic variables and other characteristics of identity that you think Hyundai wants to appeal to with the ad campaign.

The campaign is targeting communities of color, most specifically the Black community who are often overlooked in this market. OKAY Hyundai is Hyundai Motor Company’s first Black American marketing campaign – using the Black slang “OKAY,” to connect with potential Black customers, as well as to Black families. Only 3% of electric vehicles are owned by African Americans, even though concerns about the environment are high among Black consumers. (10 minutes, Chapter Objective 2 & 4, AACSB: Ethical understanding and reasoning) CS 11-2 How might the early adopters of electronic vehicles respond to the Hyundai ad campaign specifically targeted to Black customers?

Students' answers will vary. Some may find it positive to see ads depicting historically underrepresented groups portrayed in positive ways, as well simply seeing ethnic minority actors/models represented in ads. Other potential positives are 1) greater awareness of unique aspects of a particular ethnic group, 2) a general sense of “importance” of a particular ethnic group, and 3) providing jobs for actors and models in that ethnic group as well as work for advertising agencies with a particular ethnic group focus. (10 minutes, Chapter Objective 3, AACSB: Reflective Thinking) CS 11-3 How do economics, the environment and even one’s political beliefs affect the type of automobile a consumer decides to purchase?

Students' answers will vary; but students should be accounting for the pressures and privilege of diverse socioeconomic backgrounds, the norms and values of various subcultures, and the political ideologies that might emerge from these social factors.

Have students consider the intersectionality of our identities and how those aspects of self influence and inform our consumer behavior.

(10 minutes, Chapter Objective 1, AACSB: Analytical Thinking) CS 11-4 Imagine that you are in the market for a new vehicle and income is not your primary issue (have enough money to purchase whatever you like), what type of vehicle would you consider purchasing? What characteristics of your identity inform your choice of vehicle to purchase?

Students' answers will vary; but students should be accounting for various factors of our social identity (refer them to Figure 11.1), including the norms and values of various subcultures and the political ideologies that might emerge from these social factors. Have students also consider the dynamics of our identities, such as emotional profile, autonomy, and affiliation. Finally, have students consider threats to our identities as well.

(10 minutes, Chapter Objective 1, AACSB: Reflective Thinking) .

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Additional Support Material STUDENT PROJECTS Individual Projects 1.

Ask students to bring pictures of businesspersons, celebrities, athletes, etc. who, according to them, may have transcended ethnic or racial lines in terms of their appeal.

Have students justify their selections.

Student selections will vary. Beyoncé, Jennifer Lopez, Derek Jeter, Michael Jordan, and former President Obama may be among the selections. Ask students to provide evidence for the idea that the people they selected transcend ethnic or racial lines. (10 minutes, Chapter Objectives 11-4 and 11-5, AACSB: Diverse and Multicultural Work Environments)

2.

Go through both mainstream and ethnic magazines and look for ads that might be culturally/religiously insensitive. Justify why the students think so.

Again, examples are likely to vary, but look for students to provide justification for their selections. (30 minutes, Chapter Objectives 11-4 and 11-5, AACSB: Diverse and Multicultural Work Environments)

3.

Bring some magazines to class that are primarily targeted toward either African American or Caucasian audiences. Ask the students to look through each type of magazine and select advertisements that are similar, except for the models. Are there any other differences between the ads (e.g., language, social situation, etc.)? Explain.

Students’ selections will vary. Students may notice changes to the copy and the setting, in addition to the differences in the models. (20-25 minutes, Chapter Objective 11-4, AACSB: Diverse and Multicultural Work Environments)

4.

Have individual students bring to class print ads aimed at a particular subculture and show how the ads attempt to address the group. Do the students think they are effective?

Students will likely select racial or ethnic subcultures, so remind them they can select religious, age, lifestyle, etc. subcultures. (30 minutes, Chapter Objective 13-2, AACSB: Diverse and Multicultural Work Environments)

5.

Assign students to interview a member of a subculture other than his or her own (e.g., African American, Hispanic American, Asian American, white, Catholic, Mormon, Jewish, etc.) to discover what types of products or services are purchased because of membership in this particular group. What are some marketing implications? .

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Students are likely to find differences in food eaten and perhaps in the way holidays are (or are not) celebrated. Look for students to reflect on the marketing implications. (45 minutes, Chapter Objectives 11-4 and 11-5, AACSB: Diverse and Multicultural Work Environments) 6.

Have a student visit a toy store to observe the various types of toys that are for sale to ethnic subcultures. Have them give a report on the range of toys available and specify the intended racial or ethnic markets.

The selections will likely vary based on demand in the market at your location. In some cases, a product like Dora the Explorer, who is Hispanic, transcends ethnic boundaries.

(20 minutes, Chapter Objective 11-4, AACSB: Diverse and Multicultural Work Environments)

7.

Send students to a retail store of their choice and have them comment on ethnic symbols that may or may not be used in marketing the store’s products. For example, are mannequins racially diverse? Should retail stores follow a policy of appealing to ethnic groups with symbols? Explain.

The diversity of symbols like mannequins and the opinions of students are likely to vary.

Mannequins are used to create need recognition at the point of sale; ask students for their opinions regarding whether the principle of similarity extends to mannequins. (30 minutes, Chapter Objective 11-4, AACSB: Diverse and Multicultural Work Environments)

8.

Assign students to talk to a religious professional (e.g., minister or priest) about his views toward marketing to consumers based on religious preferences. What is his opinion?

Does he market his religion? If so, how? Comment on whether you agree with this policy or not.

The responses from the religious professionals and the students are likely to vary. Look for students to support their opinions. (30 minutes, Chapter Objective 11-5, AACSB: Diverse and Multicultural Work Environments and Ethical Understanding and Reasoning)

9.

Given that college students are tech-savvy, they can research and catalog some of the viral marketing efforts implemented by marketers. Are these effective in reaching them?

If yes, why and if not, why? What can be done to improve the strategies?

The number of viral marketing efforts targeting college students is large, so you may want to narrow this task to five or six from the past three years. Look for students to provide their opinions, recommendations, and support for both. (20 minutes, Chapter Objective 11-3, AACSB: Diverse and Multicultural Work Environments)

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10.

Have students collect ads that seem to stereotype some of the age groups discussed in the chapter. Are these effective or do they turn off the intended audience?

Students may have the easiest time finding ads that reflect stereotypes of teens and older adults. (45 minutes, Chapter Objective 11-3, AACSB: Diverse and Multicultural Work Environments)

11.

Choose a basic product that is used by people of all age groups (soft drink, toothpaste, automobile, etc.). Identify different brands of this product that target different age groups (Gen Yers, Gen Xers, boomers, seniors). Identify key differences in the product itself as well, as in how these brands are promoted, priced, and distributed.

Look for students to identify the characteristics of the age cohort in their description/ evaluation of the 4 P’s used for the product marketing to each group. (20 minutes, Chapter Objective 11-3, AACSB: Diverse and Multicultural Work Environments)

12.

Have students contact their parents or grandparents. What is nostalgic to them? How have you seen this used in advertising? What products have a nostalgic appeal for them? Do they say that nostalgic appeals work on them? Have them give examples.

What is nostalgic will vary by individual. Often times, examples relate to music used in advertisements. Some companies will revive earlier versions of their products to trigger nostalgic feelings. (25 minutes, Chapter Objective 11-3, AACSB: Diverse and Multicultural Work Environments)

13.

Ask students to use a product example (i.e., food products, automobiles) to illustrate how the marketer might promote to youths to take advantage of the influence they exert on family purchase decisions.

Food products that appeal to children are placed at eye level in the grocery store.

Further, food companies often use licensing deals to put children’s favorite characters on packaging and use the characters in communications. In the past, some automobile companies used cartoon characters. Now, automobile companies offer expanded features for kids (e.g. DVD players). (15 minutes, Chapter Objective 11-2, AACSB: Reflective Thinking)

Group Projects 1.

Assign student groups to visit two local supermarkets to find out if either has segmented their market based on the subculture or ethnic background of their customers. How many subcultures does each supermarket recognize? Have the students talk to the store manager if possible.

Many supermarkets have an Asian section, a Hispanic section, and/or an International section. Some have an organic section, which appeals to a lifestyle subculture. Some have .

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a section of kosher goods. The availability of different sections depends on the needs of the market and the supermarket’s flexibility to serve the market. (60 minutes, Chapter Objectives 11-4 and 11-5, AACSB: Diverse and Multicultural Work Environments) 2.

Have groups prepare a list of holidays that are oriented toward a particular subculture (e.g., Cinco de Mayo, Martin Luther King’s birthday, Passover, Easter, St. Patrick’s Day, etc.). Now have them ask a few people if they celebrate or commemorate these holidays.

What are the marketing implications? (Make sure that some of the people interviewed belong to the subcultures chosen.)

With the exception of Martin Luther King’s birthday, which may prompt travel and retail promotional sales but otherwise is less associated with specific consumption behaviors than the other holidays on the list, respondents should be able to talk about specific products associated with the holidays. (20 minutes, Chapter Objectives 11-4 and 11-5, AACSB: Diverse and Multicultural Work Environments)

3.

Have student groups go to a senior citizen gathering (this can be any kind of gathering) and interview three men and three women about nostalgia. What were they most nostalgic about? How could this be used in marketing to capture their attention? What did you learn from this experience?

As with individual project 12, the things that make the respondents nostalgic are likely to vary. Students should write up the implications of the insights gained from the interviews.

(90 minutes, Chapter Objective 11-3, AACSB: Diverse and Multicultural Work Environments)

4.

Have student groups interview a working and a nonworking woman who have children in grade school. Have them write down the menu that they served for the previous evening meal. Ask them about the specific brands that they used to prepare the meal (e.g., bread, beverage, entree, vegetables, fruits, dessert, etc.). Have them then collate this information to discover any similarities and differences.

Students may find a heavier reliance on convenience foods in the household with the working woman. However, students should consider differences that might occur if the woman has outside help (e.g. a cook, a nanny that helps prepare meals, etc.), there is a non-working man in the household, the woman’s schedule allows flexibility to prepare dinner, etc. (40 minutes, Chapter Objective 11-2, AACSB: Diverse and Multicultural Work Environments)

5.

Have groups find good and bad examples of advertising targeted toward “seasoned citizens.” To what extent do these ads stereotype the elderly? Do you think that the elderly would like or resent the implications? Are there any elements in these ads that make them effective in reaching and persuading the elderly? Explain.

The elderly is a growing age group and has different subcultures within the group. Some marketers are responding to that in their communications. For example, the AARP is 11-28

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showing ads that make the distinction between the sub segments in its target audience.

Some ads that portray the elderly in a less positive light may be targeted to younger age cohorts. (60 minutes, Chapter Objective 11-3, AACSB: Diverse and Multicultural Work Environments)

ONLINE ASSIGNMENTS Individual Assignments 1.

Go to the following: www.bet.com, www.ebony.com, and www.vibe.com. What do these African American interest websites have in common? How do they use desire for ethnicity to their advantage? Would members of other races be attracted to these sites? If so, why? State your general impressions of these sites. Explain.

Bet.com has separate sections for celebrities, music, news, and shows. Ebony.com has sections called news, entertainment, lifestyle, and your money. Finally, vibe.com is mainly about hip-hop music. It seems most likely to attract members of other races who are interested in hip-hop music. Johnson Publishing Group was planning to discontinue the publication of Ebony because of falling circulation and ad revenue. Under new leadership, with outsourced circulation, and with JPMorgan Chase as a new equity stakeholder in 2011, the magazine's numbers were improving. However, like many magazines, they have to compete with communications on the web, where bloggers are talking about causes, politics, popular culture, etc. and presenting opinions free and 24/7. (30 minutes, Chapter Objective 11-4, AACSB: Diverse and Multicultural Work Environments)

2.

Go to www.catholic.org, www.lds.org, and www.scientology.org. Each of these sites expresses thoughts about religion and religious freedom. What techniques do the sites use to stimulate their audiences to follow their messages and commit to participation? How can marketers use religious websites to their advantage? Is there a potential conflict of interest or ethical dilemma in using religious websites for commercial purposes? Explain.

The websites use different tactics to engage consumers. For example, Scientology.org has a video ad on its home page. lds.org, on the other hand, offers a lot of information.

Often, the commerce aspects of the websites are related to charity work or humanitarian efforts. Still, students may have differences of opinion about the ethics of the commerce offerings. (30 minutes, Chapter Objective 11-5, AACSB: Diverse and Multicultural Work Environments)

3.

Go to www.mtv.com. MTV has been around for a long time. Did you watch it when you were a teen? How has it changed? What new strategies is the organization using to reach its target market of today? Where will the organization be heading in the future? How could it keep its customers and viewers from “growing up” and leaving it as a source of entertainment and information? Plot a strategy that might help with this.

MTV has made changes throughout its history to appeal to the next generation of teens, with varying success. Students will likely have specific ideas to keep MTV content relevant to its fickle target audience. Look for them to tie it back to the chapter’s .

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discussion of teens and what is cool. (20 minutes, Chapter Objective 11-3, AACSB: Diverse and Multicultural Work Environments) 4.

Go to www.seventeen.com and www.cosmopolitan.com. How are these two sites different? What are their two target markets? What messages and values are being transmitted by the two websites? How can age and gender be combined by marketers to ensure success? Find two illustrations on the two websites to illustrate your thoughts or feelings.

The main difference between the two websites is the age groups they target. The content and format at cosmopolitan.com are designed to appeal to an older audience of women than the content and format at Cosmo girl, which is aggregated with the sites from Seventeen and Teen magazines. (20 minutes, Chapter Objective 11-3, AACSB: Reflective Thinking and Multicultural and Diversity Understanding)

Group Assignments 1.

Have your group explore www.starwars.com. How does this site make appeals to its selected audience? What are the strongest features of the website? Write a brief marketing plan for the website to attract more African American, Hispanic American, and Asian American visitors. Predict the success of your marketing planning effort.

Look for students to understand the characteristics, needs, and wants of the three groups in their proposed strategies. (20 minutes, Chapter Objective 11-4, AACSB: Diverse and Multicultural Work Environments)

2.

Go to www.bratz.com. Have your group analyze how this popular toy site attempts to broaden its base to various ethnic groups. After analyzing the website, write a brief summary plan that demonstrates your group’s ideas for broadening the ethnic appeal of the website.

Bratz dolls gained popularity in part because of their diverse looks and urban, hip style.

Student ideas for broadening the ethnic appeal may include new characters, complete with “lifestyle profiles” that reflect the subculture, and additional language choices. (30 minutes, Chapter Objective 11-4, AACSB: Diverse and Multicultural Work Environments)

3.

Visit www.aarp.com and determine the issues of the senior citizen segment. Are there any to which marketers need to pay attention? Determine how marketers can address them.

The AARP website attempts to keep up with the issues that are most important at any given point in time, so the issues vary. However, political discussions about Social Security benefits and health care, lifestyle issues such as fitness, blood pressure control and weight loss, and information about personal finance tend to be among the top headlines. These may be areas where senior citizens create a demand for services.

(15 minutes, Chapter Objective 11-3, AACSB: Diverse and Multicultural Work Environments)

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Chapter 12: How Groups Define Us

Chapter 12: HOW GROUPS DEFINE US

CHAPTER OBJECTIVES When students finish this chapter, students should be able to: 12- 1. Describe the role of reference groups and social norms in influencing consumer behavior.

12- 2. Describe how social influences flow through word-of-mouth communication and how they’re especially powerful when they come from opinion leaders.

12- 3. Explain how, whether in a family or a corporation, members of a group unit play different roles and have different amounts of influence when making collective decisions.

12- 4. Explain how consumers are social beings that form groups, tribes, and communities around consumption practices and brands.

CHAPTER SUMMARY Describe how social influences flow from reference groups and social norms.

We belong to or admire many different groups, and a desire for them to accept us often drives our purchase decisions. Individuals or groups whose opinions or behavior are particularly important to consumers are reference groups. Both formal and informal groups influence the individual’s purchase decisions, although such factors as the conspicuousness of the product and the relevance of the reference group for a particular purchase determine how influential the reference group is.

Describe how social influences flow through word-of-mouth communication and how they’re especially powerful when they come from opinion leaders.

Much of what we know about products we learn through word-of-mouth (WOM) communication rather than formal advertising. We tend to exchange product-related information in casual conversations. Although WOM often is helpful to make consumers aware of products, it can also hurt companies when damaging product rumors or negative WOM occur.

Opinion leaders who are knowledgeable about a product and whose opinions are highly regarded tend to influence others’ choices. Specific opinion leaders are somewhat hard to identify, but marketers who know their general characteristics can try to target them in their media and promotional strategies. Other influencers include market mavens, who have a general interest in marketplace activities, and surrogate consumers, who are compensated for their advice about purchases.

Explain how, whether in a family or a corporation, members of a group unit play different roles and have different amounts of influence when they make collective decisions.

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Section 5: Belonging

Collective decision occurs whenever two or more people evaluate, select, or use a product or service. In organizations and in families, members play several different roles during the decision-making process. These roles include gatekeeper, influencer, buyer, and user.

Marketers must understand how families make decisions. Spouses have different priorities and exert varying amounts of influence in terms of effort and power. Women who work outside the home tend to command more power in purchasing decisions, but on the other hand, the significant growth in the number of stay-at-home fathers also influences this dynamic.

Organizational buyers are people who make purchasing decisions on behalf of a company or other group. Although many of the same factors that affect how they make decisions in their personal lives influence these buyers, their organizational choices tend to be more rational.

Their decisions are also likely to involve more financial risk, and as the choices become more complex, it is probable that a greater number of people will be involved in making the decision.

The amount of cognitive effort that goes into organizational decisions relates to internal factors, such as the individuals’ psychological characteristics, and external factors, such as the company’s willingness to tolerate risk. One of the most important determinants is the type of purchase the company wants to make: The extent of problem-solving required depends on whether the product or service it procures is simply a reorder (a straight rebuy), a reorder with minor modifications (modified rebuy), or something it has never bought before or something complex and risky (new task).

Explain how consumers are social beings that form groups, tribes, and communities around consumption practices and brands.

Brand communities unite consumers who share a common passion for a product. Brandfests, which companies organize to encourage this kind of community, can build brand loyalty and reinforce group membership. Social media platforms significantly increase our access to others’ opinions about products and services. Virtual consumption communities unite those who share a common passion for products that include apparel, cars, music, beer, political candidates, etc.

Many social media users post content online that satisfies the motive for self-enhancement as well as the desire to share opinions and experiences about products and services. Consumers may engage with these brands via social games.

CHAPTER OUTLINE I.

Sources of Group Influences Social identity theory argues that each of us has several “selves” that relate to groups. These linkages are so important that we think of ourselves not just as “I,” but also as “we.”

In numerous experiments that employ the minimal group paradigm, researchers show that even when they arbitrarily assign subjects to one group or another, people favor those who wind up in the same group.

The cues we use to decide if we should identify with—and thus trust—others may be quite subtle. For example, people who simply eat the same things (what researchers .

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Chapter 12: How Groups Define Us

term IFC —Incidental Food Consumption)—like, trust, and cooperate with one another more than those who don’t.

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

1. Types of Reference Groups Consumers prefer brands that are linked to reference groups to which they belong or to which they aspired to belong because these groups contribute to their identity.

An associative reference group consists of people we actually know. In contrast although we don’t know those in an aspirational reference group, we admire them anyway.

We also deliberately do the opposite if we want to distance ourselves from dissociative groups (groups we do not want to be associated with).

2. Creating Associations with a Reference Group Recent research finds that the perceived typicality of an influencer – that is, the extent to which they conform (or fail to conform) with the stereotypical consumer of the brand – can change the strength of a brand’s associated reference group.

B. Social Norms: How Groups Change Our Behavior For a society to function, its members develop norms, or informal rules that govern behavior.

The primary driver for paying attention and behaving according to social norms is that they allow us to attain our goals of behaving effectively, of fostering and growing relationships with others, and of managing our self-concept.

1. Norms Guide Our Behavior There are two main types of norms: descriptive norms refer to our perceptions of what others are doing. When we think that many people are doing something, we are more likely also to engage in the behavior.

In contrast, prescriptive norms refer to our beliefs about what others think we should do.

2. Norms Depend Upon Comparison Groups Norms operate by giving us a sense of what other people do or think. But not all “other people” are the same.

Associative norms refer to our beliefs about a group to which we belong.

Norms we associate with a dissociative reference group are called dissociative norms. These norms are helpful to communicate behaviors that are not appealing.

3. Conformity: Going Along to Get Along Conformity is a change in beliefs or actions as a reaction to real or imagined group pressure. For a society to function, its members develop norms or informal rules that govern behavior.

The Red Sneakers Effect is the term given to an individual’s actions that are nonconforming and, under some conditions, can lead to more positive impressions.

Mere virtual presence occurs when social media reveals demographic information about a brand’s online supporters.

4. Conformity Operates on an Unconscious Level A social default occurs where a person imitates others without even thinking about .

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it. This is especially influential in situations where consumers don’t have strong preferences or don’t have the time, energy, or motivation to decide something for themselves.

Social loafing happens when we don’t devote as much time and effort to a task as we could because our contribution is part of a larger group effort.

5. Differences in Susceptibility to Influence The extent to which other people guide an individual’s choices is referred to as the personality trait susceptibility to interpersonal influence.

Use Chapter Objective 12-1 Here Use Key Terms social identity theory, minimal group paradigm, IFC (Incidental Food Consumption), reference group, associative reference group, aspirational reference group, dissociative groups, perceived typicality, descriptive no4rms, prescriptive norms, dissociative norms, conformity, norms, Red Sneakers Effect, mere virtual presence, social default, social loafing, and susceptibility to interpersonal influence Here Use Review Question 12-11 Here Use Consumer Behavior Challenges 12-18, 12-31 and 12-35

II.

Word-of-Mouth Word-of-mouth (WOM), or in the digital era, word of mouse, influence refers to product information that individuals transmit to other individuals. WOM is more influential than traditional marketing messages.

WOM is especially powerful when the consumer is relatively unfamiliar with the product category.

A. Viral Marketing and Buzz Building Stimulate WOM to build buzz around a product or service, then sit back and let your customers do the heavy lifting.

Viral marketing occurs when an organization motivates visitors to forward online content to their friends.

Brand communications form feedback loops (“echoes”) between all the sources of brand information- the “universe” of corporate communications, news media, and user-generated social media.

B. Negative WOM Consumers weigh negative word-of-mouth more heavily than they do positive comments.

As we transmit information to one another, it tends to change. The resulting message usually does not resemble the original at all. The term for the process that takes place is serial reproduction.

C. Buzz Gone Bad Just as buzz is great when it benefits the brand, it can also turn sour if it falls into a negativity spiral, a process through which negative messages inspired others to add to the conversation. These negative spirals can trigger social media firestorms, a sudden increase in negative word-of-mouth and complaints against a company. These can be .

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especially damaging to brands.

D. Information Flows in Social Networks: Who Knows Whom?

The play Six Degrees of Separation is based on the premise that everyone on the planet indirectly knows everyone else. A game called Six Degrees of Kevin Bacon challenges players to link the actor Kevin Bacon with other actors in much the same way.

Sociometric methods trace communication patterns among members of a group.

1. The Structure of Social Networks

Sociometric analyses can identify referral behavior (who recommends a brand to whom) and locate strengths and weaknesses in terms of how a brand’s reputation flows through a network.

Whether offline or online, social networks consist of a set of socially relevant nodes connected by one or more relations. Nodes are members of the network who are connected to one another. Ties are the connections among nodes; these form due to shared affiliations, common hobbies and interests, and, of course, family, friends, and professional contacts.

Social networks are sometimes called social graphs, though this term may also refer to a diagram of the interconnections of units in a network.

Flows occur between nodes. Flows are exchanges of resources, information, or influence among members of the network. In social media, these flows of communication go in many directions at any point in time and often on multiple platforms – a condition referred to as media multiplexity.

2. Tie Strength

Sociometric techniques consider the type of relationships among members of a social network. Tie strength refers to the nature of the bond between people. It can range from strong primary (e.g., a person’s spouse) to weak secondary (e.g., an acquaintance whom you rarely see).

Although strong ties are important, weak ties are as well because they perform a bridging function, which may result in a referral process, thus demonstrating the strength of weak ties. Weak ties are even stronger influences when they rely on consensus language – that is, language signaling general agreement about a product or behavior.

Recent research shows the differences between hub users (social media users who have a higher ratio of followers relative to people they are following) and non-hub users. This research suggests that non-hub users may play an important role in the diffusion of new products because these users have much stronger ties with those in their immediate network.

3. Information Cascades

Researchers of social network dynamics have uncovered a web of complexities in how information circulates in these networks. The original framework of opinion leadership is called the two-step flow model of influence. It proposes that a small group of influencers disseminates information because they can modify the opinions of a large number of others.

Newer frameworks say the influence is driven more by the interaction among those who are easily influenced; they communicate the information to one another and participate in a two-way dialogue with the opinion leader as part of an influence network. .

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These conversations in turn create information cascades that occur when a piece of information triggers a sequence of interactions.

Businesses often seek to leverage our social networks to acquire new customers and generate WOM. One of the motivations that drives us to share is the motivation for social empowerment, the desire to feel an impact on others. A case in point: the rise of social coupons, coupon sets that include one for self-use and one to be shared.

E. Who Influences Us: Opinion Leaders and Social Media Influencers Opinion leaders are individuals that are frequently able to influence others’ attitudes or behaviors. Opinion leaders are extremely valuable information sources because they possess social power, or the capacity to alter the actions of others.

Homophily refers to the degree to which a pair of individuals is similar in terms of education, social status, and beliefs. Effective opinion leaders tend to be slightly higher in status and educational attainment than those they influence, but not so high as to be in a different social class.

1. Social Media Influencers The influencer marketing model basically replicates the “cool kid” phenomenon we all experienced in high school.

When companies rely on social media influencers, they take advantage of four key influencer resources: follower networks, positioning, content, and follower trust. They tap into the influencer’s follower networks, capitalize on the influencer’s personal positioning in a specific domain of interest and on the communication content, and most of all, they rely on the trust followers have in the influencer.

2. Identifying the Most Effective Opinion Leaders The fact we transmit advice about products does not mean other people take that advice.

3. Bloggers The viral marketing explosion highlights the power of the megaphone effect; a huge audience is available to everyone.

The phenomenon of the dispreferred market effect occurs when someone couches a negative review by beginning with dispreferred markers such as “I’ll be honest…”

4. The Surrogate Consumer The surrogate consumer is a third party we retain to provide input into our purchase decisions.

5. Product Curators The product curator is an individual, working on behalf of manufacturers or stores, that create an exhibition and often include recommendations about how to use the items and perhaps even share their stories about how they use them in their own lives.

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Use Chapter Objective 12-2 Here Use Key Terms word-of-mouth (WOM), word of mouse, viral marketing, user-generated social media, negative word-of-mouth, serial reproduction, negativity spiral, Six Degrees of Kevin Bacon, sociometric methods, social networks, modes, ties, social graphs, media multiplexity, tie strength, strength of weak ties, consensus language, hub users, two-step flow model of influence, influence network, information cascades, social empowerment, social coupons, opinion leaders, social power, homophily, influencer marketing model, influencer resources, megaphone effect, dispreferred market effect, surrogate consumer, and product curator Here Use Review Questions 12-1, 12-2, 12-3, 12-4, 12-5, 12-6, 12-7, 12-8, and 12-9 Here Use Consumer Behavior Challenges 12-19, 12-22, 12-23, 12-24, 12-15, 12-26, 12-28, 12-29, 12-30,12-34 and 12-35 Here

III.

Who Influences Us: Collective Decision Making A. The Collective Decision Making Process Many of the decisions we make are collaborative.

This collaborative or collective decision-making process includes two or more people who may not have the same level of investment in the outcome, the same tastes and preferences, or the same consumption priorities.

1. Key Roles in a Collective Decision The roles in the collective decision making process include the following: • Initiator • Gatekeeper • Influencer • Buyer • User 2. Factors That Influence Group Decisions

Some specific factors that come into play in group decision making include: • Interpersonal need • Product involvement and utility • Responsibility • Power B. The Intimate Corporation: Collective Decision Making in Households The synoptic ideal calls for the husband and wife to act as joint decision makers.

Research shows that one way a partner in a close relationship can act out if they feel they have less power is via oppositional brand choice; they deliberately choose brands they know their partner doesn’t like.

C. Collective Decision Making in Organizations

Organizational buyers are people who purchase goods and services on behalf of companies for the companies’ use in manufacturing, distribution, or resale. These individuals buy from business-to-business (B2B) marketers that must satisfy the needs of organizations.

A number of factors influence the organizational buyer’s perception of the purchase situation. These include: .

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•

Expectations of the supplier (e.g., product quality, the competence and behavior of the firm’s employees, and prior experiences in dealing with that supplier) • Organizational climate of the company (i.e., how it rewards performance and what it values) • Buyer’s assessment of his or her own performance (e.g., whether he or she believes in taking risks).

Typically, a group of people (members of a buying center) plays different roles in more complex organizational decisions.

The buyclass theory of purchasing divides organizational buying decisions into three types.

• A straight rebuy is a habitual decision.

• A modified rebuy situation involves limited decision making.

• A new task involves extensive problem solving.

Agile marketing refers to using data and analytics to continuously source promising opportunities or solutions to problems in real time, deploying tests quickly, evaluating the results, and rapidly iterating. Scrum involves the use of small teams that run quick “sprints” and frequently change up their approach based upon rapid and honest feedback.

Use Chapter Objective 12-3 Here Use Key Terms collective decision-making process, synoptic ideal, oppositional brand choice, business-to-business (B2B) marketers, buying center, buyclass theory of purchasing, straight rebuy, modified rebuy, new task, and agile marketing Here Use Review Questions 12-12, 12-13, 12-14, 12-15, and 12-16 Here Use Consumer Behavior Challenges 12-17, 12-20, 12-27, and 12-31 Here

IV.

Who Influences Us: Consumer Communities A. Consumer Collective Consumer collectives are networks of social relations centered on a brand, a practice, or a digital platform.

Collectives can be of all sizes, visibility, and longevity. Some, called brand secret microcollectives are very small, secretive, and ephemeral.

Consumers also rally in movements toward or against causes they care about.

B. A Culture of Participation Social media platforms enable a culture of participation: a belief in a democratic internet; the ability to freely interact with other people, companies, and organizations; open access to venues that allow users to share content from simple comments to reviews, ratings, photos, stories, and more; and the power to build on the content of others from your own unique point of view.

Digital platforms also provide an easy way for consumers around the world to exchange information about their experiences with products, services, music, restaurants, and .

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movies. Brand communities are a hugely important meeting place for like-minded consumers to commune with other fans of a product, service, store, or celebrity/athlete.

C. Brand Communities

A brand community is a group of consumers who share a set of social relationships based on usage of or interest in a product.

Some community-oriented companies may hold brandfests to bring owners together.

Researchers find that brand community members create added value for themselves and other members as they develop better ways to use and customize products. Collective value creation is the idea of experienced product users coaching new users in ways to maximize their enjoyment of the product, so that more and more people benefit from a network of satisfied participants.

1. Key Characteristics of Online Communities Successful online communities possess several important characteristics:

• Standards of behavior (no flaming – posting in all caps - allowed) • Member contributions (most members are lurkers) • Degree of connectedness • Network effects D. Support Groups In addition to organized religion, numerous other types of groups serve similar functions for consumers – following a spiritual-therapeutic model.

There are Facebook groups for just about anything. A recent study of health- and wellness- related virtual support communities found that members of the community do not always get what they come for. The researchers identified many paradoxical social dynamics, or contradictory aspects in how members relate to one another.

Private groups on social media offer a safe space for identity expression, especially for groups that feel marginalized. These groups can become what researchers call counterspace to the dominant images and stereotypes in the more mainstream media.

E. Gaming Communities A social game is a multiplayer, competitive, goal-oriented activity with defined rules of engagement and online connectivity among a community of players.

These applications usually incorporate elements of game design, such as leaderboards that indicate how each player is doing relative to others and badges that show the community the challenges the player has mastered.

MMORPGs, or massive multiplayer online role-playing games, truly encompass the social aspects of gaming.

Digital virtual consumption (DVC) may well be the next frontier of marketing.

Consumers worldwide spend more than $80 billion per year to by virtual goods for their online characters.

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Use Chapter Objective 12-4 Here Use Key Terms consumer collectives, brand secret microcollectives, movements, culture of participation, brand community, brandfests, collective value creation, flaming, lurkers, spiritual-therapeutic model, virtual support communities, paradoxical social dynamics, counterspace, social game, leaderboards, badges, MMORPGs, digital virtual consumption (DVC) and virtual goods Here Use Review Question 12-10 Here Use Consumer Behavior Challenges 12-21 and 12-32 Here

End-of-Chapter Support Material

REVIEW QUESTIONS 12-1. What is word of mouth, and how can it be more powerful than advertising?

Word of mouth (WOM) is product information transmitted by individuals to individuals.

Because we get the word from people we know, WOM tends to be more reliable and trustworthy than recommendations we get through more formal marketing channels. (5 minutes, Chapter Objective 12-2, AACSB: Reflective Thinking) 12-2. Which is more powerful, positive or negative word of mouth?

Consumers weigh negative word of mouth more heavily than they do positive comments.

(5 minutes, Chapter Objective 12-2, AACSB: Reflective Thinking) 12-3. Describe some ways in which marketers use the internet to encourage positive word of mouth.

A virtual community of consumption is a collection of people whose online interactions are based upon shared enthusiasm for and knowledge of a specific consumption activity.

Like the brand communities we discussed earlier, these groups form around a shared love for a product, whether it is Barbie dolls or Apple iPads. However, members remain anonymous because they only interact with each other in cyberspace. (10 minutes, Chapter Objective 12-2, AACSB: Reflective Thinking)

12-4. What is viral marketing? Give an example of this strategy.

Viral marketing refers to the strategy of getting visitors to a website to forward information on the site to their friends in order to make still more consumers aware of the product—usually by creating online content that is entertaining or just plain weird. Viral marketing for oil? Pretty slick. WD-40 quadrupled visitors to its fan club website by .

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offering 1,000 AM/FM radios in the shape of oilcans to individuals who signed up 10 other members. (5 minutes, Chapter Objective 12-2, AACSB: Reflective Thinking) 12-5. What is an opinion leader? Give three reasons why they are powerful influences on consumers’ opinions.

An opinion leader is a person who is frequently able to influence others’ attitudes or behaviors.

• •

•

•

•

They are technically competent and thus convincing because they possess expert power.

They have prescreened, evaluated, and synthesized product information in an unbiased way, so they possess knowledge power. Unlike commercial endorsers, opinion leaders do not actually represent the interests of one company. Thus, they are more credible because they have no “axe to grind.”

They tend to be socially active and highly interconnected in their communities. They are likely to hold offices in community groups and clubs and to be active outside of the home. As a result, opinion leaders often have legitimate power by virtue of their social standing.

They tend to be similar to the consumer in terms of their values and beliefs, so they possess referent power. Note that although opinion leaders are set apart by their interest or expertise in a product category, they are more convincing to the extent that they are homophilous rather than heterophilous. Homophily refers to the degree to which a pair of individuals is similar in terms of education, social status, and beliefs. Effective opinion leaders tend to be slightly higher in terms of status and educational attainment than those they influence, but not so high as to be in a different social class.

Opinion leaders are often among the first to buy new products, so they absorb much of the risk. This experience reduces uncertainty for others who are not as courageous.

Furthermore, whereas company-sponsored communications tend to focus exclusively on the positive aspects of a product, the hands-on experience of opinion leaders makes them more likely to impart both positive and negative information about product performance. (10 minutes, Chapter Objective 12-2, AACSB: Reflective Thinking)

12-6. Is there such a thing as a generalized opinion leader? Why or why not?

When marketers and social scientists initially developed the concept of the opinion leader, they assumed that certain influential people in a community would exert an overall impact on group members’ attitudes. However, later work began to question the assumption that there is such a thing as a generalized opinion leader, somebody whose recommendations we seek for all types of purchases. Very few people are capable of being expert in a number of fields. Sociologists distinguish between those who are monomorphic, or expert in a limited field, and those who are polymorphic, or expert in several fields. (5 minutes, Chapter Objective 12-2, AACSB: Reflective Thinking) .

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12-7. What is the relationship between an opinion leader and an opinion seeker?

The fact that we transmit advice about products does not mean other people take that advice. For someone to be considered a bona fide opinion leader, opinion seekers must actually heed his advice. An alternative is to select certain group members (key informants) who we ask to identify opinion leaders. The success of this approach hinges on locating those who have accurate knowledge of the group and on minimizing their response biases (e.g., the tendency to inflate one’s own influence on the choices of others). (5 minutes, Chapter Objective 12-2, AACSB: Reflective Thinking) 12-8. What are sociometric techniques? Under what conditions does it make sense to use them?

Sociometric methods trace communication patterns among members of a group. These techniques allow researchers to systematically map out the interactions that take place among group members. (5 minutes, Chapter Objective 12-2, AACSB: Reflective Thinking) 12-9. List three types of social power, and give an example of each.

Responses will vary by students. Social power describes the capacity to alter the actions of others. It can be based on referent power (the power to promote a fashion brand by a celebrity), information power (identifying the next trend in gaming), legitimate power (doctors at a hospital teaching medical students), expert power (hiring an astronaut to design technology for the space station), reward power (earning loyalty rewards from your favorite retailer), or coercive power (a car salesman offering a special price if you buy today). (5 minutes, Chapter Objective 12-2, AACSB: Reflective Thinking) 12-10. What is a brand community, and why is it of interest to marketers?

A brand community is a group of consumers—like those zealous Halo players— who share a set of social relationships based on usage of or interest in a product. Researchers find that people who participate in these events feel more positive about the sponsor’s products as a result, and this enhances brand loyalty. They tend to forgive product failures or lapses in service quality, and they’re less likely to switch brands even if they learn that competing products are as good or better. Furthermore, these community members become emotionally involved in the company’s welfare, and they often serve as brand missionaries because they carry its marketing message to others. Researchers find that brand community members do more than help the product build buzz; their inputs actually create added value for themselves and other members as they develop better ways to use and customize products. (5 minutes, Chapter Objective 12-4, AACSB: Reflective Thinking) 12-11. Define conformity and give an example of it. Name three reasons why people conform.

Conformity is a change in beliefs or actions as a reaction to real or imagined group pressure. For a society to function, its members develop norms or informal rules that .

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govern behavior. Without these rules, we would have chaos. Imagine the confusion if a simple norm such as “always stop for a red traffic light” did not exist. There are several reasons why people conform, and student answers will vary, but should include a combination of cultural pressures, fear of deviance, commitment, group unanimity, size and expertise, susceptibility to interpersonal influence, and environmental cues. (5 minutes, Chapter Objective 12-1, AACSB: Reflective Thinking)

12-12. How does knowing what you now know about B2B decisions change the way you might approach a marketing campaign to influence the members of a buying center?

Three types of strategies encompass most organizational decision situations.

• • •

A straight rebuy is a habitual decision. It’s an automatic choice, as when an inventory level reaches a preestablished reorder point.

A modified rebuy situation involves limited decision making. It occurs when an organization wants to repurchase a product or service but also wants to make some minor modifications.

A new task involves extensive problem solving. Because the company hasn’t made a similar decision already, there is often a serious risk that the product won’t perform as it should or that it will be too costly. (45 minutes, Chapter Objective 12-3, AACSB: Reflective Thinking)

12-13. What are some factors that influence how an organizational buyer evaluates a purchase decision?

Three decision making dimensions describe the purchasing strategies of an organizational buyer: 1.

The level of information he or she must gather prior to the decision.

2.

The seriousness with which he or she must consider all possible alternatives.

3.

The degree to which he or she is familiar with the purchase. (15 minutes, Chapter Objective 12-3, AACSB: Reflective Thinking)

12-14. Summarize the buyclass model of purchasing. How do decisions differ within each class?

The classic buyclass theory of purchasing divides organizational buying decisions into three types that range from the least to the most complex. Three decision making dimensions describe the purchasing strategies of an organizational buyer: 1.

2.

3.

The level of information they must gather prior to the decision.

The seriousness with which they must consider all possible alternatives.

The degree to which they are familiar with the purchase. (15 minutes, Chapter Objective 12-3, AACSB: Reflective Thinking)

12-15. What are some of the ways in which organizational decisions differ from individual .

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consumer decisions? How are they similar?

•

• • • •

•

The purchase decisions that companies make frequently involve many people, including those who do the actual buying, those who directly or indirectly influence this decision, and the employees who will actually use the product or service.

Organizations and companies often use precise technical specifications that require a lot of knowledge about the product category.

Impulse buying is rare (industrial buyers do not suddenly get an “urge to splurge” on lead pipe or silicon chips). Because buyers are professionals, they base their decisions on past experience and they carefully weigh alternatives.

Decisions often are risky, especially in the sense that buyers’ careers may ride on their judgment.

The dollar volume of purchases is often substantial; it dwarfs most individual consumers’ grocery bills or mortgage payments. One hundred to 250 organizational customers typically account for more than half of a supplier’s sales volume, which gives the buyers a lot of influence over the supplier.

B2B marketing often emphasizes personal selling more than advertising or other forms of promotion. Dealing with organizational buyers typically requires more face-to-face contact than when marketers sell to end consumers. (25 minutes, Chapter Objective 12-3, AACSB: Reflective Thinking)

12-16. List three roles employees play in the organizational decision-making process.

The roles are: • Initiator—The person who brings up the idea or identifies a need.

• Gatekeeper—The person who conducts the information search and controls the flow of information available to the group. In organizational contexts, the gatekeeper identifies possible vendors and products for the rest of the group to consider.

• Influencer—The person who tries to sway the outcome of the decision. Some people may be more motivated than others to get involved, and participants also possess different amounts of power to get their point across.

• Buyer—The person who actually makes the purchase. The buyer may or may not actually use the product.

• User—The person who actually consumes the product or service. (15 minutes, Chapter Objective 12-3, AACSB: Reflective Thinking)

CONSUMER BEHAVIOR CHALLENGE DISCUSS 12-17. Industrial purchase decisions are totally rational. Aesthetic or subjective factors don’t— and shouldn’t—play a role in this process. Do you agree?

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Student responses to this question will vary. (10 minutes, Chapter Objective 12-3, AACSB: Reflective Thinking) 12-18. We can think of college students who live away from home as having a substitute “family.” Whether you live with your parents, with a spouse, or with other students, how are decisions made in your college residence “family”? Do some people take on the role of mother, father, or child? Give a specific example of a decision that had to be made and the roles members played.

Answers to this question will vary substantially; however, the same factors come into play regardless of their answers. Those factors are: • • • •

Interpersonal need—(a person’s level of investment in the group) Product involvement and utility—(the degree to which a person will use the product to satisfy a need) Responsibility—(for procurement, maintenance, payment, and so on) Power—(or the degree to which one family member exerts influence over the others) (20 minutes, Chapter Objective 12-1, AACSB: Reflective Thinking)

12-19. A sociometric study on obesity (similar to the one we read about regarding clusters of smokers) provides a striking example of how our social networks influence what we do.

The researchers analyzed a sample of more than 12,000 people who participated in the Framingham Heart Study, which closely documented their health from 1971 to 2003.

They discovered that obesity can spread from person to person, much like a virus. The investigators knew who was friends with whom, as well as who was a spouse or sibling or neighbor, and they knew how much each person weighed at various times over three decades so they could reconstruct what happened over the years if study participants became obese. Guess what? When one person gains weight, close friends tend to gain weight, too. A person’s chances of becoming obese if a close friend put on the pounds increased by 57 percent! The friend’s influence remained even if he or she lived hundreds of miles away. The researchers speculated that the reason for this social contagion effect is that when our best buds get fat, this alters our perception of normal body weight, so we aren’t as concerned when we put on a few pounds as well. How does social contagion work in your life?

Sociometric methods trace communication patterns among members of a group.

These techniques allow researchers to systematically map out the interactions among group members. In many cases, one or a few people emerge as the “nodes” in a map— our opinion leaders. This method is the most precise, but it is difficult and expensive to implement because it involves close study of interaction patterns in small groups. For this reason, it’s best to apply a sociometric technique in a closed, self-contained social setting, such as in hospitals, in prisons, and on military bases, where members are largely isolated from other social networks. Sociometric techniques don’t just look at who talks (or texts) to whom; they also consider the type of relationships among members of a social network. Tie strength refers to the nature of the bond between people. It can .

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range from strong primary (e.g., one’s spouse) to weak secondary (e.g., an acquaintance whom one rarely sees). Although strong ties are important, weak ties are as well because they perform a bridging function. This type of connection allows a consumer access between subgroups. (15 minutes, Chapter Objective 12-2, AACSB: Analytical Thinking) 12-20. The average U.S. teenager spends well more than 8 hours a day in front of a screen, whether smartphone, PC, TV, or tablet. One study reported increasing physical isolation among Internet users; it created a controversy and drew angry complaints from some users who insisted that time they spent online did not detract from their social relationships. However, the researchers said they had now gathered further evidence showing that Internet use has lowered the amount of time people spend socializing with friends and even sleeping. According to the study, an hour of time spent using the Internet reduces face-to-face contact with friends, co-workers, and family by 23.5 minutes, lowers the amount of time spent watching television by 10 minutes, and shortens sleep by 8.5 minutes.

What’s your perspective on this issue? Does increasing use of the internet have positive or negative implications for interpersonal relationships in our society?

The answer to this question all depends on how “interpersonal” is defined. If the definition sticks to that of traditional face-to-face communication, then it will be hard to argue that increased time online does not detract from interpersonal communication.

Time is a limited resource. And as is shown above in the question itself, there is research to back this up. However, if students lean toward defining interpersonal communication as any type of communication between people, then there will be strong argument for the fact that increased time online enhances such. Given that many people spend time emailing, IMing, chatting, interacting in forums, blogs, etc., then in many cases, the time spent online is providing opportunities to interact with others that would otherwise not be there. (15 minutes, Chapter Objective 12-2, AACSB: Analytical Thinking) 12-21. A consumer tribe is similar to a brand community; it is a group of people who share a lifestyle and can identify with each other because of a shared allegiance to an activity or a product. Although these tribes are often unstable and short lived, at least for a time members identify with others through shared emotions, moral beliefs, styles of life, and of course the products they jointly consume as part of their tribal affiliation.

Some companies, especially those that are more youth-oriented, use a tribal marketing strategy that links their product to, say, a group of shredders. However, there also are plenty of tribes with older members, such as car enthusiasts who gather to celebrate cult products like the Citroën in Europe and the Ford Mustang in the United States, or “foodies” who share their passion for cooking with other Wolfgang Puck wannabes around the world. Identify and visit a tribal festival in your area (e.g. a comic book convention, a rock concert, a basketball tournament, a vegan food show, etc). What role do marketers play in this event? How and to what extent do attendees identify with other “tribal” members?

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Responses will vary based on the tribal event students choose to participate in, but should discuss opinion leaders and influence networks. (3-4 hours, Chapter Objective 124, AACSB: Reflective Thinking)

12-22. Walmart contended with a widespread text-messaging hoax that warned women to stay away from its stores or risk death. The digital rumor apparently originated in an urban myth (an unsubstantiated “fact” that many people accept as true) that circulated via email several years ago. As a reflection of how widespread this myth became, at one point Walmart was number five on Twitter’s list of trending topics. If you were a Walmart communication executive, how might you deal with this kind of public relations nightmare?

Students are likely to have different opinions about the best way to handle the rumors.

Draw their attention to the information about rumors and word-of-mouth so they understand the value of having consumers share the right information (vs. using less credible advertising). (15 minutes, Chapter Objective 12-2, AACSB: Ethical Understanding and Reasoning Abilities) 12-23. The strategy of viral marketing gets customers to sell a product to other customers on behalf of the company. That often means convincing your friends to climb on the bandwagon, and sometimes you get a cut if they buy something. Some might argue that that means you’re selling out your friends (or at least selling to your friends) in exchange for a piece of the action. Others might say you’re simply sharing the wealth with your buddies. Have you ever passed along names of your friends to a company or website? If so, what happened? How do you feel about this practice?

Responses will vary based on student experiences. When people share their opinions about products with their social networks, they may do so to satisfy one of several goals: To manage the impression they make on others, to regulate emotions by expressing affective reactions, to share and acquire information, to bond with others, and to persuade others to change their opinions. Unlike a spontaneous conversation in the physical world, when consumers write about products they have more time to think strategically about what they’re saying—and about how these judgments reflect on them.

(15 minutes, Chapter Objective 12-2, AACSB: Ethical Understanding and Reasoning) 12-24. Social media influencers and opinion leaders are sometimes called power users. They

have a strong communications network that gives them the ability to affect purchase decisions for a number of other consumers, directly and indirectly. Much like their offline counterparts, power users are active participants at work and in their communities. Their social networks are large and well developed. Others trust them and find them to be credible sources of information about one or more specific topics. They tend to have a natural sense of intellectual curiosity, which may lead them to new sources of information. And they post an awful lot of brand-related content: Forrester Research has dubbed these brand-specific mentions influence impressions. In advertising lingo, an impression refers to a view or an exposure to an advertising message. Forrester estimates .

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that, each year, U.S. consumers generate 256 billion influence impressions as people talk about their lives with each other, telling stories and experiences that invariably include brands. These influence impressions are primarily delivered by—you guessed it—power users: Only 6.2 percent of social media users are responsible for about 80 percent of these brand mentions. Forrester calls these influencers mass connectors. Suppose you wanted to conduct a social media campaign that targets these valuable power users. How would you respond to your (non-marketing) CEO who says, “These people make up only a very small slice of our total customer market. Why would we bother to waste our precious resources on them?”

Responses will vary based on student experiences. Students should consider the attributes of effective opinion leaders and influencers. (15 minutes, Chapter Objective 12-2, AACSB: Ethical Understanding and Reasoning) APPLY 12-25. Identify fashion opinion leaders on your campus. Do they fit the profile the chapter describes?

The class might agree to focus on a particular group of fashion opinion leaders. After deciding on the group, they could go through an opinion leader profile and determine whether or not the group members actually are fashion experts. (Possible Field Project Idea) (15 minutes, Chapter Objective 12-2, AACSB: Reflective Thinking) 12-26. A study on antibranding documented hostility among consumers who object to the gasguzzling Hummer vehicle. One driver posted this message: “The H2 is a death machine.

You’d better hope that you don’t collide with an H2 in your economy car. You can kiss your ass goodbye thanks to the H2’s massive weight and raised bumpers. Too bad you couldn’t afford an urban assault vehicle of your own.”

Identify an antibranding site for another product. What functions does the site seem to serve? How can people who participate there be considered part of a community?

Answers will vary, some students will discuss public service announcements like don’t drink and drive or don’t smoke, etc. (15 minutes, Chapter Objective 12-2, AACSB: Reflective Thinking) 12-27. More than 16 million millennial women are now mothers, and that number grows by more than a million every year. These new parents demand innovations in child rearing to match their experiences in other realms of their lives. These “parennials” are informationhungry; they never stop researching the best things to buy for their children. There are numerous resources for them to learn about parenting, such as chat rooms like Wonder Weeks and WebMDBaby. Many parennials, accustomed to chronicling every great dish they ordered in a restaurant, give their children YouTube channels from the first sonogram and hashtags when they’re born. What is the next “killer app” for young parennials? .

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Students’ responses to this question will vary widely. (5 minutes, Chapter Objective 12-2, AACSB: Reflective Thinking) 12-28. Conduct a sociometric analysis within your dormitory or neighborhood. For a product category such as music or cars, ask each individual to identify other individuals with whom they share information. Systematically trace all of these avenues of communication and identify opinion leaders by locating individuals whom others say provide helpful information.

Students should include a discussion of sociometry in their responses and recognize that sociometric methods allow researchers to systematically point out the interactions that take place among group members. Conducting a study of this type should highlight for students how difficult and expensive such activities can be. (Possible Field Project Idea) (90 minutes, Chapter Objective 12-2, AACSB: Analytical Thinking) 12-29. Trace a referral pattern for a service provider such as a hair stylist; track how clients came to choose them. See if you can identify opinion leaders who are responsible for referring several clients to the businessperson. How might the service provider take advantage of this process to grow their business?

Students are likely to come up with all types of incentive programs that will motivate customers to refer friends. Once something like that is in place, the likelihood of a referral network emerging is greater. (30 minutes, Chapter Objectives 12-2 and 12-3, AACSB: Reflective Thinking) 12-30. The power of unspoken social norms often becomes obvious only when we violate them.

To witness the result firsthand, try one of the following: Stand facing the back wall in an elevator, serve dessert before the main course, offer to pay cash for dinner at a friend’s home, wear pajamas to class, or tell someone not to have a nice day.

Answers will vary. (15 minutes, Chapter Objective 12-1, AACSB: Reflective Thinking) 12-31. Identify a set of dissociativegroups for your peers. Can you identify any consumption decisions that you and your friends make with these groups in mind?

Responses will vary by student. Reference groups impact our buying decisions both positively and negatively. In most cases, we model our behavior to be in line with what we think the group expects us to do. Sometimes, however, we also deliberately do the opposite if we want to distance ourselves from avoidance groups. You may carefully study the dress or mannerisms of a group you dislike (e.g., “nerds,” “druggies,” or “preppies”) and scrupulously avoid buying anything that might identify you with that group. Rebellious adolescents do the opposite of what their parents desire to make a statement about their independence. In one study, college freshmen reported consuming less alcohol when they associated it with their avoidance groups. (15 minutes, Chapter Objective 12-4, AACSB: Reflective Thinking) .

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12-32. Several colleges have sponsored “social media detox” events. Students at Saint Mary’s College of California were challenged to “Disconnect, Power Off and Unplug” in order to rediscover “The Lost Art of Solitude;” no Internet for a month! The library at Wake Forest University created a “ZieSta Room” where technology is banned.

Do a “detox” of your own for 48 hours. No cellphones. No Facebook. No social media of any kind. Keep a diary of your experiences.

Student outcomes will vary. (50 hours, Chapter Objectives 12-1 and 12-2, AACSB: Information Technology)

12-33. Although social networking is red hot, could its days be numbered? Many people have concerns about privacy issues. Others feel that platforms such as Facebook are too overwhelming. As one media executive comments, “Nobody has 5,000 real friends. At the end of the day it just becomes one big cauldron of noise.” What’s your stance on this: Can we have too much of a good thing? Will people start to tune out all of these networks?

Student responses will vary. The fear of missing out (FOMO) drives many on social media to constantly check their status to be certain they stay on top of what their (online) friends are up to. Certainly, there are advantages to always feeling connected, but perhaps the downside is a vague feeling of regret or inadequacy that lurks in the background in case we chose not to be somewhere—or even worse, that we weren’t invited in the first place. FOMO usually is based upon a false perception that friends’ lives are so much more glam than their own. Many people assume that others are better off socially, but those others feel the same. All of this has the potential to lead to social media burnout. (25 minutes, Chapter Objective 12-2, AACSB: Reflective Thinking) 12-34. The adoption of a certain brand of shoe or apparel by athletes can be a powerful influence on students and other fans. Should high school and college coaches be paid to determine what brand of athletic equipment their players wear?

Student responses will vary. The conversation should focus on the role players (and coaches) play as potential opinion leaders. (10 minutes, Chapter Objectives 12-1 and 122, AACSB: Ethical Understanding and Reasoning)

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CASE STUDY TEACHING NOTES Chapter 12 Case Study: Lush Is Trying to Find an Authentic Voice Online Summary of Case Lush, a skincare firm, makes environmentally friendly products that align with the social identity and values of their customers. This case discusses how the company is attempting to appeal to its customers in an authentic way. The company’s most ardent followers are known as “Lushies.”

To maintain its connection, Lush has faced challenges striking the right tone in its social media utilization.

Suggestions for Presentation You may wish to encourage students to explore the Lush website and some of its social media posts on Twitter, Pinterest, and YouTube before discussing this case. As an exercise, you could ask them to plan out a sample of a social media post that its customers would find authentic and appealing.

Suggested Answers for Discussion Questions CS 12-1 What is the rationale behind Lush’s decision to discontinue and then reintroduce a curated assortment of social media channels? Do you think followers and customers understood Lush’s choice? Why or why not?

Students should be able to articulate the complexity of social media and the various ways messaging – even well-intended messaging – can be misunderstood or misappropriated. This reality of social media is something students might be able to relate to in their personal lives as well, allowing you to draw the connection between organizations and the individual, the business world and the personal world. Students will have varying interpretations and opinions as to whether customers understand or agree with focusing on certain social media platforms as opposed to others, which presents an opportunity to discuss the influence of groups and opinion leaders.

(15 minutes, Chapter Objectives 1 & 2, AACSB: Application of Knowledge)

CS 12-2 As Lush implemented the change, how could it measure the effects of leaving, then returning to social media, on the achievement of its marketing goals?

The company could examine metrics before it began discontinuing its presence on certain social media. It could look at overall followers, website traffic, repeat buyers, quarterly revenue reports, etc. Lush could also then examine metrics in a similar way after it began to develop a presence on specific media. Because part of their decision making was influenced by the COVID-19 pandemic shutdowns, the company could also look at the influence of social norms and communities that formed as a result in changes consumption patterns.

(10 minutes, Chapter Objectives 1 & 4, AACSB: Analytical Thinking)

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CS 12-3 How would you describe the Lush brand community? What are the key characteristics of the online community? How do you think Lush’s decision to discontinue and criticize the same social media outlets that connects the brand with its followers will impact how customers view the brand?

Students will have varying opinions about how best to describe the Lush community, as well as its key characteristics. Focus students attention on the structure of social networks and the informational flows within that network.

(10 minutes, Chapter Objective 1, AACSB: Application of Knowledge)

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Additional Support Material STUDENT PROJECTS Individual Projects 1.

Ask each student to think about individual family members, friends, and acquaintances.

On paper, have them identify the people who act as opinion leaders, product innovators, and market mavens. Describe what each person does. Have a few students share their observations with the class.

Look for evidence that students can differentiate between opinion leaders (knowledgeable consumers who are frequently able to influence others’ attitudes or behaviors), product innovators (consumers who actively seek out the latest and greatest in a product category and are willing to take risks), and market mavens (individuals with a general interest in the marketplace). (20 minutes, Chapter Objective 12-2, AACSB: Reflective Thinking)

2.

Have a student think about some goods and services that he/she has purchased recently.

To what extent did word-of-mouth communication influence purchases?

Word-of-mouth tends to be more credible than advertising. Students are more likely to rely on word-of-mouth and external search, in general, in high involvement purchase categories. Social risk may increase reliance on word-of-mouth. Negative word-of-mouth tends to be a larger consideration in purchase decisions than positive word-of-mouth. (10 minutes, Chapter Objective 12-2, AACSB: Reflective Thinking)

3.

Encourage a student to think of something he/she recently purchased in which advice was actively sought from others. For what reasons was advice sought? Why was the particular person selected to provide this advice?

Students are likely to note advice was sought for a high involvement product, which usually motivates more active external search. Advice is typically sought from individuals with knowledge/expertise in the product category. (15 minutes, Chapter Objectives 12-1 and 12-4, AACSB: Reflective Thinking)

Group Projects 1.

Each student group will have the task of forming or joining a brand community. Have them decide upon a brand that none of them really uses. Then, have them research the brand extensively and begin their own pro-product dialogue among themselves. If they wish to establish an online chat room or message board, that would be all the better. After having done this for a set period, have group members discuss how they feel about the brand. Whether they have purchased or not, do they feel more “loyal”? Have they developed positive attitudes? Do they find themselves engaging in WOM outside the group?

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Students should select a product they use, have an interest in, and are passionate about, if possible. Look for students to connect with the ideas in the figure (e.g. social networking, community engagement, impression management, and brand use). (90 minutes, Chapter Objective 12-4, AACSB: Reflective Thinking) 2.

Have the students videotape interviews with three individuals regarding a product they recently purchased for the first time. Why did they purchase it? What was the role of “word of mouth” and personal influence (whether real or simulated)? The group should edit the tape to present a summary illustration of their findings.

As in the individual project, interviewees are likely to note advice was sought for a high involvement product, which usually motivates more active external search. Advice is typically sought from individuals with knowledge/expertise in the product category. (60 minutes, Chapter Objective 12-2, AACSB: Reflective Thinking)

3.

Describe how opinion leaders can be formed and found on the Internet. Describe the advantages and disadvantages of using opinion leaders on the Web. How would this form of opinion leadership be different from any other form of opinion leadership (if at all)?

Opinion leaders can be formed via the Internet because of the availability of product information to be synthesized and the ability to connect with a large number of individuals. Opinion leaders might be found in top organic search results, by having a high circle of trust/positive feedback from other users, or having many followers. They may be less likely to be similar to the consumer in terms of values and beliefs. (30 minutes, Chapter Objective 12-2, AACSB: Analytical Thinking)

4.

Have student groups do an analysis of a rumor that was started about a product or company (e.g., a human finger found in a can of Pepsi, the “Satanic” connection in Procter & Gamble’s moon-and-stars logo; Pop Rocks candy will make your stomach explode; McDonald’s puts worms in its hamburgers; there are spider eggs in Bubble Yum, etc.). What effect did these rumors have on sales? How did the company handle the situation?

Look for students to include research on the rumor/to include outside sources in their assignment. You can extend this assignment by asking the student to suggest an alternative response strategy for the company. (60 minutes, Chapter Objective 12-2, AACSB: Reflective Thinking)

5.

Have a group prepare a sociometric analysis of online grocery shoppers. How is this group different and similar to in-store shoppers?

Sociometric analysis would show whether the individuals refer others or influence others’ purchase decision online. They could be compared to off-line shoppers. (90 minutes, Chapter Objective 12-2, AACSB: Analytical Thinking)

ONLINE ASSIGNMENTS .

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Individual Assignments 1.

Go to www.hairclub.com. One of the great problems facing men in our day and age is the prospect of going bald. How does the Hair Club for Men play to male fears? How do they use opinion leaders to persuade prospective customers to try their products? What do you think of the organization’s promotional campaigns? Explain.

The Hair Club shows successful clients receiving positive reinforcement for their new looks, including the Hair Club’s president. Encourage students to think about the ethics of indicating that bald = ugly and hair = happy, successful, and attractive. (30 minutes, Chapter Objective 12-2, AACSB: Reflective Thinking)

Group Assignments 1.

Visit a few fraternity or sorority websites and evaluate how they try to influence their current and potential brothers and sisters. Talk to students who are members and those that are not associated with them. Determine if their group influences are effective or not based on your assessments of the two groups – members and non-members.

Students should have observations from the public communications on the web sites, from members, and from non-members. Look for students to support their conclusions about the effectiveness of the group influences from these three sets of observations. (60 minutes, Chapter Objectives 12-1 and 12-4, AACSB: Analytical Thinking)

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Chapter 13: Social Class and Status

Chapter 13: SOCIAL CLASS AND STATUS

CHAPTER OBJECTIVES When students finish this chapter, students should be able to: 13- 1. Summarize how our consumption choices are expressions of our taste and are strongly influenced by our social class.

13- 2. Describe how consumption contributes to movements within and across social class structures.

13- 3. Explain how we consume to communicate our social standing to others.

13- 4. Discuss the ways organizations are starting to work toward greater social justice to combat inequality.

CHAPTER SUMMARY Summarize how our consumption choices are expressions of our taste and are strongly influenced by our social class.

Our consumption choices are expressions of our taste and are strongly influenced by our social class. A consumer’s social class refers to their standing in society. Factors including education, occupation, and income determine the class to which we belong. Virtually all groups make distinctions among members in terms of relative superiority, power, and access to valued resources. This social stratification creates a status hierarchy in which consumers prefer some goods to others. Although income is an important indicator of social class, the relationship is far from perfect. Factors such as place of residence, cultural interests, and worldview also determine social class.

Describe how consumption contributes to movements within and across social class structures.

Consumption contributes to movements within and across social class structures. Social class is a continuum, and we can—as a function of life events, many of them consumption-related— move up and down along this continuum. For instance, gaining more education allows us to access occupations with greater prestige. These movements along the social class continuum are referred to as social mobility.

Explain how we consume to communicate our social standing to others.

We consume to communicate our social standing to others. Social comparison occurs when we assess how we stand compared to others around us. This process also is key to understanding our perceptions of social status in a society: We compare ourselves and what we have with others and what they have, or with our own situation in earlier times. Because products and .

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services link so closely to social class, they often play an important role as status symbols in communicating wealth or prestige to others.

Discuss the ways organizations are starting to work toward greater social justice to combat inequality.

Many organizations are starting to work toward greater social justice to combat inequality.

Purpose-driven consumers, who choose products and brands based on how well they align with their values, now represent the largest segment of consumers. But, as marketers jump on the social justice bandwagon, it’s crucial for them to “walk the walk” as well as “talk the talk” when they align themselves with causes.

CHAPTER OUTLINE I.

What Is Social Class?

Social class refers to a group of people with similar levels of prestige and esteem who also share beliefs, attitudes, and values that they express in their thinking and behavior.

People tend to marry in a social class similar to their own, a tendency called homogamy. More than 90 percent of married high school dropouts marry someone who also dropped out or who has only a high school diploma.

A. Social Class Provides a Set of Resources

Current theoretical perspectives on social class view the social structure of a society as a function of how economic, status, and power dimensions are systematically distributed. A person’s capital refers to their own resources, as well as their ability to effectively mobilize the capital resources in their network of connections. For these sociologists, social class is a set of resources that are deployed by a person within a competitive field to attain greater symbolic capital within that field.

Each social class group shares the same type of capital, but the resources of each social class group are different.

• Economic capital is money and wealth.

• Social capital is the aggregate of actual and potential resources within one’s social network. But it’s not just knowing a lot of people; it’s about being able to get the backing of those relationships.

• Cultural capital refers to a set of distinctive tastes, skills, and practices.

Embodied cultural capital refers to the knowledge and skills that we’ve acquired from our social position and that we demonstrate on an everyday basis.

These differences create social distinction, a system of social relations embedded in judgments of consumption tastes. The new elite in America, which some researchers term the aspirational class, are highly educated, but their consumption choices are far from flashy. Instead, their choices reflect their .

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values.

B. Social Distinction, Taste, and Habitus The sociological perspective regards class as a network for relationships of mutual acquaintances that can draw upon each other’s resources. B Bourdieu concluded that “taste” (preference for specific things) is a statusmarking force, or habitus, that causes consumption preferences to cluster together.

According to Bourdieu, we consumer and collect experiences when we are young, and we incorporate these experiences into our habitus as we accumulate cultural capital.

A person’s social standing shapes a taste regime, or a system of norms that links aesthetics to practice.

C. Online Capital

When you’re online, it’s not so much what you own as what you post or how you post it that raises or lowers your status among your network.

The “psychic income” we get when we post reviews that others validate creates a reputation economy, in which the “currency” people earn is approval rather than cold hard cash.

Like exclusive country clubs, online gated communities that selectively allow access to some people may offer a high degree of social capital to the lucky few who pass the test.

D. “Is That a Yoga Mat?” Taste Cultures and Codes Our consumption choices are expressions of our taste and a representation of our social class.

Luxury consumers who become connoisseurs gain what researchers have termed maturity: They reject mass luxury brands, preferring instead inconspicuous luxury products.

The term glamping refers to luxury “camping” in which participants use luxury RVs and create private enclaves accessible only to them.

E. How Do We Measure Social Class?

Given the complexities of social class, it’s not easy to quantify these categories.

That’s because social class is as much a state of being as it is of having: It’s not just about money but also what we do with our money and how our social class identity influences what we think is important, desirable, or just plain attractive.

Standing in society is hard to measure objectively, so most sociologists instead rely on proxies, or indicators that give an approximate indication of one’s position. By far, the most useful proxies of social class are education and profession.

One proxy that’s gaining in popularity is a person’s credit score.

These measure of subjective socioeconomic status assess perceived social class and are better suited for psychological research that tackles the impact of one’s perceived social standing on psychological functioning and behavior.

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Use Chapter Objective 13-1 Here Use Key terms social class, homogamy, economic capital, social capital, cultural capital, embodied cultural capital, social distinction, aspirational class, taste, habitus, taste regime, reputation economy, online gated communities, maturity, glamping, and proxies Here Use Review Questions 13-3, 13-5, 13-7, 13-8, 13-10, and 13-11 Here Use Consumer Behavior Challenges 13-20,13-21, 13-23, 13-24, 13-26, and 13-31 Here

II.

Social Class Structures In virtually every context, some people rank higher than others. Patterns of social arrangements evolve whereby some members get more resources than others by virtue of their relative standing, power, or control in the group.

A. Social Stratification The process of social stratification refers to this creation of artificial divisions that allow us to understand the structure of a society, the relative size of the different socioeconomic groups, and the types of consumer behavior that are prevalent in each stratum.

Most groups exhibit a structure, or status hierarchy in which some members are better off than others.

A system which defines people by what they do for a living is called occupational prestige and is one way we evaluate their “worth.”

B. Social Mobility Social mobility refers to the passage of individuals from one social class to another.

Horizontal mobility occurs when a person moves from one position to another that’s roughly equivalent in social status. Downward mobility occurs when displaced workers go on welfare rolls or join the ranks of the homeless.

Upper mobility reflects a movement upward on the social ladder.

Two factors contribute to upward mobility: increases in educational attainment and a shift in women’s roles: 1.

The college wage premium, which describes the gap between what workers with a college degree earn compared with those without one, has grown dramatically.

2.

Mothers with preschool children are the fastest-growing segment of working people. The female-to-male earnings ratio is 0.82, which means that on average a woman earns 82 cents for every dollar a man brings home. Compensation continues to lag.

C. Some Key Factors That Influence Consumer Behavior within and across Social Classes Individuals in different social classes have distinct ways of thinking, feeling, and acting.

1. Empowerment One study that looked at social class and how it relates to consumers’ feelings of empowerment reported that lower-class consumers are less likely to feel 13-4

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they have the power to affect their outcomes in life. This orientation influenced consumption behaviors.

2. Consumer Confidence Consumer confidence reflects how optimistic or pessimistic people are about the future health of the economy and how they predict they’ll fare down the road.

A range of factors influence the overall savings rate including individual consumers’ pessimism or optimism about their personal circumstances, such as a sudden increase in personal wealth as the result of an inheritance and global events such as the Great Recession.

3. Old Money versus New Money People who have had money for a long time tend to use their fortunes a lot differently.

Old money families (e.g., the Rockefellers, DuPonts, Fords, and others) live primarily on inherited funds.

The label nouveau riche describes consumers who recently achieved their wealth and who don’t have the benefit of years of training to learn how to spend it.

A cosmopolitan is someone who tries to be open to the world and who strives for diverse experiences.

Use Chapter Objective 13-2 Here Use Key terms social stratification, status hierarchy, occupational prestige, social mobility, horizontal mobility, downward mobility, upper mobility, college wage premium, female-tomale earnings ratio, consumer confidence, savings rate, nouveau riche, and cosmopolitan Here Use Review Questions 13-1, 13-2, 13-4, 13-9, and 13-12 Here Use Consumer Behavior Challenges 13-18, 13-29, and 13-30 Here

III.

Social Status and Consumption Social comparison is key to understanding our perceptions of social status in a society. This term refers to where we think we stand in a society, and to assess that standing, we compare ourselves and what we have with others and what they have, or with our own situation in earlier times.

When consumers compare their financial situation with others, they may get a sense of financial deprivation, or the sense that they don’t have as much money as their peers.

Class consciousness is an awareness of one’s place in a system of social classes.

A. To Whom Do We Compare Ourselves?

When we engage in upward comparison, we compare ourselves to aspirational .

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social reference groups, but when we engage in downward comparison, we look at those less fortunate than us.

An aspirations gap is the relative difference between one’s aspired standard of living and that which they have attained.

No matter how much material life conditions change, one’s well-being tends to revert to its previous baseline – known as the “hedonic treadmill.”

Aspirations failure refers to living in a high-growth area leading people to form lofty but unattainable goals, which can create frustration and discouragement when the goals do not come to fruition.

Some researchers measure what they call subjective socioeconomic status – a person’s judgment of their own status, whether or not that assessment necessarily corresponds to reality – by simply asking people to indicate the degree to which they perceive themselves or their households to be worse off or better off than most other people or households.

B. Status Symbols Because products and services link so closely to social class, they often play an important role as status symbols – possessions or services that communicate wealth or prestige to others.

Status seeking is a significant source of motivation to procure products and services that we hope will let others know we’ve “made it.”

According to optimal distinctiveness theory, all of us experience tension between a need for assimilation and a need for differentiation. Lower-class consumers have a dominant need to assimilate while higher-class consumers have a dominant need to differentiate.

Virtue signaling is the impression management practice of publicly expressing sentiments intended to show one’s good character of moral uprightness.

C. Conspicuous Consumption Veblen suggested that we buy things to create invidious distinction; this means that we use our purchases to inspire envy in others through our display of wealth or power.

Conspicuous consumption refers to people’s desire to provide prominent, visible evidence of their ability to afford luxury goods – also referred to as status signaling.

Some people spend above their means as a form of impression management that makes others believe they have the resources to splurge even then these excesses may decrease their overall standard of living; this is called “spending implies wealth.”

Consumers engage in conspicuous consumption to display status markers, yet the prominence of these markers varies from products with large recognizable emblems to those with no logo at all. These differences are labeled brand prominence.

Status signaling is especially common for those individuals who have a higher power distance belief – that is, those who have a higher acceptance of and tendency to endorse power or status disparities.

Reverse signaling refers to the type of signals we infer from associations between a product or brand and people of a given social class.

D. Status Pivoting Upward comparison can make us worried about our social status, a condition called status threat. This can motivate us to emulate their consumption choices. Another 13-6

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way to cope with status threat is by status pivoting, which also involves signaling our status and success – but doing so in alternative domains.

E. Status and Parody Displays As the competition to accumulate status symbols escalates, sometimes the best tactic is to switch gears and go in reverse. One way to do this is to deliberately avoid status symbols. This sophisticated form of conspicuous consumption is called parody display.

F. The Meaning of “Luxury”

SRI Consulting Business Intelligence divides consumers into three groups based on their attitudes toward luxury: 1.

Luxury is functional—These consumers use their money to buy things that will last and have enduring value.

2.

Luxury is a reward—These consumers use luxury goods to say, “I’ve made it.”

3.

Luxury is indulgence—To these consumers, the purpose of owning luxury is to be extremely lavish and self-indulgent.

G. The Evolutionary Perspective on Luxury Luxury products serve many purposes: They boost consumers’ self-esteem, allow them to express their identity, and signal social status. In line with the evolutionary perspective, which examines human behavior through the lens of biological evolution and natural selection, researchers have found that luxury products also play important signaling functions in heterosexual relationships: Men use conspicuous luxury products to attract mates, whereas women use such products to deter female rivals.

Use Chapter Objective 13-3 Here Use Key terms social status, financial deprivation, class consciousness, upward comparison, downward comparison, aspirations gap, hedonic treadmill, aspirations failure, subjective socioeconomic status, status symbols, status seeking, virtue signaling, invidious distinction, conspicuous consumption, status signaling, spending implies wealth, brand prominence, power distance belief, reverse signaling, status threat, status pivoting, parody display, and evolutionary perspective Here Use Review Questions 13-13, 13-14, and 13-15 Here Use Consumer Behavior Challenges 13-19, 13-22, 13-27, and 13-28 Here

IV.

Social Inequality, Poverty, and Social Justice Income inequality is the extent to which resources are distributed unevenly within a population.

One Percenter is a term used to describe the top 1 percent of income in the US. The wealthiest 160,000 U.S. families have as much as the poorest 145 million families.

The wealthiest 1 percent of Americans control around 20 percent of the national income. .

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One indicator of income inequality is the CEO pay ratio, which compares the salary of a company’s chief executive to the earnings of a typical employee.

The digital divide refers to how access to technology is still restricted for many people because of income.

Many advocates argue that historical, legal, and political processes that have acted selectively upon individuals with the lowest levels of education and income have accentuated health disparities.

A. The Bottom of the Pyramid: Low-Income Consumers The vast numbers of low-income consumers are referred to as the bottom of the pyramid. These four billion people live on less than $2 per day.

The 4A’s framework of awareness, affordability, acceptability, and availability helps marketers make needed changes to provide for the needs of low-income consumers around the world.

B. The Role of Consumption in Social Justice: Walk the Walk The National Retail Federation reports that purpose-driven consumers, who choose products and brands based on how well they align with their values, now represent the largest segment of consumers (44 percent).

C. Social Responsibility Consumption is often at the core of economic inequalities.

To address social justice in the global marketplace and create social change that eliminates or reduces inequalities, researchers propose programmatic responses across the main institutions in the market as well as more cooperation among these domains: 1. Businesses can improve access to bottom-of-the-pyramid consumers and invest in cause-related marketing.

2. Society can form grassroots community organizations and consumer movements that generate change.

3. The government can enact policy changes and put forth education efforts that improve citizens’ opportunities for upward social mobility and offer safeguards to those in precarious situations.

4. Non-profit organizations can fund and encourage social programs that address and reduce social inequalities.

Use Chapter Objective 13-4 Here Use Key terms income inequality, one percenter, CEO pay ratio, digital divide, health disparities, bottom of the pyramid, purpose-driven consumers, and social change Here Use Review Questions 13-6 and 13-16 Here Use Consumer Behavior Challenges 13-25 and 13-27 Here

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End-of-Chapter Support Material

REVIEW QUESTIONS 13-1. How have women contributed to the overall rise in income in our society?

One reason for this increase in income is that there also have been a larger proportion of people of working age participating in the labor force. Mothers with preschool children are the fastest-growing segment of working people. Furthermore, many of these jobs are in high-paying occupations such as medicine and architecture that used to be dominated by men. Although women are still a minority in most professional occupations, their ranks continue to swell. The steady increase in the numbers of working women is a primary cause of the rapid growth of middle- and upper-income families. There are now more than 18 million married couples making over $50,000 a year. However, in almost two-thirds of these families, the wife’s paycheck is propelling the couple up the income ladder. (5 minutes, Chapter Objective 13-2, AACSB: Reflective Thinking)

13-2. How does consumer confidence influence consumer behavior?

Consumers’ beliefs about what the future holds are an indicator of consumer confidence that reflects the extent to which people are optimistic or pessimistic about the future health of the economy and how they will fare down the road. These beliefs influence how much money they will pump into the economy when making discretionary purchases. (5 minutes, Chapter Objective 13-2, AACSB: Application of Knowledge)

13-3. What is social class? Is it different from income? If so, how?

We use the term social class more generally to describe the overall rank of people in a society. People who are grouped within the same social class are approximately equal in terms of their social standing in the community. They work in roughly similar occupations, and they tend to have similar lifestyles by virtue of their income levels and common tastes. These people tend to socialize with one another and share many ideas and values regarding the way life should be lived. Indeed, “birds of a feather do flock together.” (10 minutes, Chapter Objective 13-1, AACSB: Application of Knowledge) 13-4. Define social mobility and describe the different forms it takes.

In some societies, such as India, one’s social class is very difficult to change, but America is reputed to be a country in which “any man (or woman?) can grow up to be president.” Social mobility refers to the “passage of individuals from one social class to .

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another.” Social mobility can be upward or downward. (10 minutes, Chapter Objective 13-2, AACSB: Application of Knowledge) 13-5. What one variable is the best indicator of social class? What are some other important indicators?

When we think about a person’s social class, there are a number of pieces of information we may consider. Two major ones are occupation and income. A third important factor is educational attainment that is strongly related to income and occupation. (5 minutes, Chapter Objective 13-1, AACSB: Reflective Thinking) 13-6. What is income inequality, and why is it a problem?

Today one of the biggest issues we hear about is income inequality, that is, the extent to which resources are distributed unevenly within a population. One consequence of rising inequality is that more consumers worry about “falling behind” if a breadwinner loses his or her job or if the family can no longer afford the cost of housing, transportation, and other necessities. For example, a researcher who conducted an in-depth study of residents of a rural trailer park identified one segment of consumers she called the Reluctant Emigrants. These people once lived in fixed-site homes but various economic problems forced them to move to the more affordable trailer park. Because their lives are on a downward trajectory, their primary concerns focus on security and protection. (5 minutes, Chapter Objective 13-4, AACSB: Reflective Thinking) 13-7. Why might a person’s social class not change when they earn more money?

One problem is that even if a family increases household income by adding wage earners, each additional job is likely to be of lower status. A homemaker who gets a parttime job is not as likely to get one that is of equal or greater status than the primary wage earner’s full-time job. In addition, the extra money earned is often not pooled toward the common good of the family. Instead, the individual uses it for his own personal spending.

More money does not then result in increased status or changes in consumption patterns because it tends to be devoted to buying more of the usual rather than upgrading to higher-status products. (10 minutes, Chapter Objective 13-1, AACSB: Reflective Thinking) 13-8. What are some of the problems we encounter when we try to measure social class?

One reason is that most measures of social class were designed to accommodate the traditional nuclear family, with a male wage earner in the middle of his career and a female full-time homemaker. Such measures have trouble accounting for two-income families, young singles living alone, or households headed by women, who are so prevalent in today’s society. Another problem with measuring social class is the increasing anonymity of our society. Earlier studies relied on the reputational method, in which extensive interviewing was done within a community to determine the reputations and backgrounds of individuals. This information, coupled with the tracing of interaction .

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patterns among people, provided a very comprehensive view of social standing within a community. However, this approach is virtually impossible to implement in most communities today. One compromise is to interview individuals to obtain demographic data and to combine these data with the subjective impressions of the interviewer regarding the person’s possessions and standard of living. (15 minutes, Chapter Objective 13-1, AACSB: Reflective Thinking) 13-9. How do the worldviews of blue-collar and white-collar consumers tend to differ?

Although they would like to have more in the way of material goods, working-class people do not necessarily envy those who rank above them in social standing. They may not view the maintenance of a high-status lifestyle as worth the effort. As one blue-collar consumer commented, “Life is very hectic for those people. There are more breakdowns and alcoholism. It must be very hard to sustain the status, the clothes, and the parties that are expected. I don’t think I’d want to take their place.” (10 minutes, Chapter Objective 13-2, AACSB: Reflective Thinking) 13-10. Describe the difference between a restricted and an elaborated code. Give an example of each.

These definitions are found in a previous chapter. Students may refer to those definitions and draw on material from this chapter to provide examples. Restricted codes are dominant among the working class, whereas the middle and upper classes tend to use elaborated codes. Restricted codes focus on the content of objects, not on relationships among objects. Elaborated codes, in contrast, are more complex and depend on a more sophisticated worldview. These code differences extend to the way consumers approach basic concepts such as time, social relationships, and objects. (10 minutes, Chapter Objective 13-1, AACSB: Reflective Thinking) 13-11. What is cultural capital, and how does a person accumulate it?

This refers to a set of distinctive and socially rare tastes and practices—knowledge of “refined” behavior that admits a person into the realm of the upper class. The elite in a society collect a set of skills that enable them to hold positions of power and authority, and they pass these on to their children (such as etiquette lessons and debutante balls).

These resources gain in value because access to them is restricted. That is part of the reason why people compete so fiercely for admission to elite colleges. Much as we hate to admit it, the rich are different. (10 minutes, Chapter Objective 13-1, AACSB: Application of Knowledge) 13-12. How do you differentiate between “old money” versus “Nouveau Riches” consumers?

We call consumers who have achieved extreme wealth and have relatively recently become members of upper social classes the nouveau riches, a term that many people use in a derogatory manner to describe newcomers to the world of wealth. (5 minutes, Chapter Objective 13-2, AACSB: Reflective Thinking) .

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13-13. What roles do status symbols play in purchase decisions?

We tend to evaluate ourselves, our professional accomplishments, our appearance, and our material well-being relative to others. Often it’s not enough just to have wealth or fame; what matters is that you have more of it than others. A major motivation to buy is not to enjoy these items but rather to let others know that we can afford them. These products are status symbols. The popular bumper-sticker slogan, “He who dies with the most toys, wins,” summarizes the desire to accumulate these badges of achievement.

Status-seeking is a significant source of motivation to procure appropriate products and services that we hope will let others know we’ve “made it.” A study demonstrated how people turn to status symbols to prop up their self-concepts, especially when they feel badly or uncertain about other aspects of their lives. Rising incomes in man economically developing countries, such as South Korea and China, coupled with decreasing prices for quality consumer goods and services, create explosive demand for luxury products or at least “affordable” versions of these goods. This change fuels demand for mass-consumed products that still offer some degree of panache. Companies such as H&M, Zara, EasyJet, and L’Oréal provide creature comforts to a consumer segment that analysts label mass class. This term describes the hundreds of millions of global consumers who now enjoy a level of purchasing power that’s sufficient to let them afford high-quality products—except for big-ticket items such as college educations, housing, or luxury cars.

(5 minutes, Chapter Objective 13-3, AACSB: Reflective Thinking) 13-14. What is conspicuous consumption? Give a current example.

Conspicuous consumption refers to people’s desire to provide prominent visible evidence of their ability to afford luxury goods. (5 minutes, Chapter Objective 13-3, AACSB: Application of Knowledge) 13-15. What is a current example of parody display?

As the competition to accumulate status symbols escalates, sometimes the best tactic is to switch gears and go in reverse. One way to do this is to deliberately avoid status symbols—that is, to seek status by mocking it. Social scientists call this sophisticated form of conspicuous consumption parody display. Hence, the popularity of old, ripped blue jeans, and “utility” vehicles such as Jeeps among the upper classes. (5 minutes, Chapter Objective 13-3, AACSB: Reflective Thinking) 13-16. What is wokewashing, and how does this practice relate to brands that take a stand on social justice issues?

Wokewashing occurs when marketers don’t back up their claims. It is critical for marketers to “walk the walk” and “talk the talk.” A failure to do so can result in being called out. A potential positive then becomes a negative as consumers expect the organization to be firm in their stated commitment to social justice issues. (5 minutes, Chapter Objective 13-4, AACSB: Ethical Understanding and Reasoning) .

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CONSUMER BEHAVIOR CHALLENGE DISCUSS 13-17. The comedian Groucho Marx famously commented, “I’d never join a club that would

have me as a member.” Some venues—such as exclusive websites, nightclubs, etc.— carefully monitor participants to screen out people who don’t “belong.” What do you think of this practice?

Student opinions will vary. They may provide examples of their own clubs screening membership. (5 minutes, Chapter Objective 13-2, AACSB: Reflective Thinking) 13-18. Research finds that the social elite tend to be omnivorous: They embrace and seek variety

in all forms of consumption, from music to food. But being omnivorous is not just happening amongst the elite. A sociological study compared American consumers’ openness to different musical genres between 1993 and 2012. Their study showed a trend toward greater openness and acceptance of diversity in music not just amongst the elites but every education level and age group (especially young people) in their large sample.

If we continue to see this kind of openness to new experiences, how do you think that social change may affect the power of social class in the coming years?

Student responses will vary. Students may include a discussion of cosmopolitanism and an openness to diverse experiences across social classes. (5 minutes, Chapter Objective 13-2, AACSB: Reflective Thinking) 13-19. Sears, JC Penney, and Walmart tried hard in recent years to upgrade their images and appeal to higher-class consumers. How successful have these efforts been? Do you believe this strategy is wise?

JC Penney has not been very successful in changing its image. Because consumers have always thought of stores like JC Penney, Sears, and Walmart as discount or low-price stores, it is likely that these stores will have difficulty changing their images among the public. Attempting to change a store’s image when consumers have a strong perception of the store’s image—and one that is largely inconsistent with the proposed image—can be a very risky strategy. As in the case of JC Penney, retailers run the risk of alienating a significant group of loyal consumers with these attempts. (15 minutes, Chapter Objective 13-3, AACSB: Analytical Thinking) 13-20. What are some of the obstacles to measuring social class in today’s society? Discuss some ways to get around these obstacles.

Some of the obstacles in measuring social class in today’s society are changes in family structure, anonymity, and status inconsistency. One way to get around obstacles is to obtain demographic data and combine the data with the interviewer’s subjective impressions of the individual’s standard of living and possessions. Interviewers should be .

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adequately trained. Researchers should attempt to cross-validate data with multiple judges. (15 minutes, Chapter Objective 13-1, AACSB: Reflective Thinking 13-21. How do you assign people to social classes, or do you at all? What consumption cues do you use (e.g., clothing, speech, cars, and so on.) to determine social standing?

As discussed in the text, people are assigned to social classes by virtue of their social standing in the community. People are grouped according to their occupation, lifestyle, ideas and values, and income. Consumption cues that may be used to determine people’s social standing include their cars, homes, clothing, speech, and types of people with whom they socialize. (15 minutes, Chapter Objective 13-1, AACSB: Reflective Thinking) 13-22. In today’s economy, it has become somewhat vulgar to flaunt your money – if you have any left. Do you think this means that status symbols like luxury products are passé? Why or why not?

This will be an interesting debate among students. They may agree that luxury can be consumed in tasteful ways. The absence of a conspicuous brand on luxury items is one way around this concern. Luxury products are becoming more popular in China and some Arab countries. (15 minutes, Chapter Objective 13-3, AACSB: Reflective Thinking) 13-23. Thorstein Veblen argued that men in the 19th century used young, attractive women as “trophy wives” to display their wealth. Is this argument still valid today?

Student responses will vary based on their opinion of trophy wives. To Veblen, wives are an economic resource. He criticized the “decorative” role of women, as rich men showered them with expensive clothes, pretentious homes, and a life of leisure as a way to advertise their own wealth. Today we refer to these women as trophy wives. In recent years the tables have turned as older women—who increasingly boast the same incomes and social capital as their male peers—seek out younger men as arm candy. These socalled cougars are everywhere; surveys estimate that about one-third of women older than age 40 date younger men. (5 minutes, Chapter Objective 13-1, AACSB: Reflective Thinking) 13-24. Research suggests that social class influences how much compassion people show to others who need help. For example, one study reported that luxury car drivers were more likely to cut off other motorists instead of waiting for their turn at the intersection.

Another showed that less-affluent people are more likely to agree with such statements as, “I often notice people who need help,” and “It’s important to take care of people who are vulnerable.” Other studies have demonstrated that upper-class people are not as good at recognizing others’ emotions. One explanation is that more resources provide a sense of independence; the less we have to rely on others, the less we care about their feelings.

Do you agree that wealthy people are less caring? Why or why not?

Student responses will vary. One approach to social class focuses on the codes (the ways .

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consumers express and interpret meanings) people within different social strata use.

Restricted codes focus on the content of objects, not on relationships among objects.

Elaborated codes, in contrast, are more complex and depend on a more sophisticated worldview. These code differences extend to the way consumers approach basic concepts such as time, social relationships, and objects. (5 minutes, Chapter Objective 13-1, AACSB: Ethical Understanding and Reasoning)

13-25. This chapter observes that some marketers find “greener pastures” when they target lowincome people. How ethical is it to single out consumers who cannot afford to waste their precious resources on discretionary items? Under what circumstances should we encourage or discourage this segmentation strategy?

Student responses will vary but should indicate an understanding of segmentation strategy and why marketers use it. There should also be an understanding of the 4 A’s of addressing low-income consumers and targeting the bottom of the pyramid. (10 minutes, Chapter Objective 13-4, AACSB: Ethical Understanding and Reasoning) 13-26. Some have referred to our modern world as “status obsessed” because we are constantly bombarded with images and posts of peers and strangers alike on social media, such as Facebook, LinkedIn, and Twitter. Do you agree?

Student responses will vary but should indicate an understanding of the impact of social media on marketing and self-perceptions. (10 minutes, Chapter Objective 13-1, AACSB: Reflective Thinking) 13-27. The chapter discussed the evolutionary perspective. It is important to note that this viewpoint attracts a lot of debate, sometimes heated and biting, among consumer researchers. The advocates argue that deep-seated evolutionary motives influence much modern behavior, in particular protection motives, such as avoiding physical harm or disease, and social motives, such as affiliation, acceptance, and status; acquiring and keeping a mate; and caring for family. The critics argue that it is overly simplistic to view humans as wired to have survival or reproduction instincts and that our genes and predispositions cannot in and of themselves explain many of our behaviors. What do you think?

Student opinions will vary. (10 minutes, Chapter Objectives 13-3 and 13-4, AACSB: Reflective Thinking) 13-28. Status symbols are products, such as Rolex watches or expensive sports cars, that we value because they show others how much money or prestige we have. Do you believe that your peer group values status symbols? Why or why not? If yes, what are the products that you think are status symbols for consumers your age? Do you agree with the assertion that a cell phone is a status symbol for many young people?

Status symbols are possessions we use to communicate wealth or prestige to others.

Today, cell phones are ubiquitous in our society. Possibly the type of cell phone today is .

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a better status symbol than just the possession of a cell phone. (15 minutes, Chapter Objective 13-3, AACSB: Reflective Thinking) 13-29. As we continue to emerge from The Great Recession, many people live frugally; they cut back on visits to restaurants, buy fewer high-end clothes and other luxury goods, and hold onto their cars much longer. Are we witnessing a long-term shift in consumer behavior, or do you believe this is just a temporary situation?

Student responses will vary widely based upon their personal beliefs. (5 minutes, Chapter Objective 13-2, AACSB: Reflective Thinking)

APPLY 13-30. Compile a list of occupations and ask a sample of students in a variety of majors (both business and non-business) to rank the prestige of these jobs. Can you detect any differences in these rankings as a function of students’ majors?

The students should be encouraged to try this exercise with a variety of individuals, not just students in different majors. It would be interesting to see differences in perceptions of prestige due to gender, age, current occupation, level of education, etc. (Possible Field Project Idea) (30 minutes, Chapter Objective 13-2, AACSB: Analytic Skills) 13-31. Compile a collection of ads that depict consumers of different social classes. What generalizations can you make about the reality of these ads and about the media in which they appear?

The instructor might review this exercise after students have completed it. The instructor might attempt to identify aspects of the advertisements that students used to classify consumers as members of different social classes. A discussion of how our attitudes and perceptions are influenced by stereotypical beliefs could then be used with the students’ own examples as evidence of stereotypical beliefs and their potentially negative consequences. (Possible Field Project Idea) (30 minutes, Chapter Objective 13-1, AACSB: Reflective Thinking)

CASE STUDY TEACHING NOTES Chapter 13 Case Study: Are Dollar Stores Really Cheaper?

Summary of Case Consumer behavior is influenced by internal and external factors. One of the external factors that sets real boundaries for consumers is their level of income. Some marketers refer to strategies directed at different income tiers as targeting certain levels of a pyramid. Dollar Stores Market to .

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the bottom of the pyramid (focusing on consumers with very limited financial means) which provides market opportunity but also presents unique challenges.

Suggestions for Presentation This material can be used to illustrate how factors like target market income level can affect all parts of the marketing mix strategy.

Suggested Answers for Discussion Questions CS 13-1 Using the “4A’s” framework in Figure 13.3, analyze the considerations that went into the decision for Dollar General opening 1,000+ new stores in the United States over the past few years.

The two areas Dollar Stores primarily focuses on affordability. The company looks for opportunities to create value while also focusing on appealing to the customer desire to find “the thrill of a good deal.” The economic factors of its customers does not allow for much latitude in price variation, so Dollar Store will continue to focus on this formula.

(10 minutes, Chapter Objective 1 & 3, AACSB: Application of Knowledge) CS 13-2 Select one city in one of the states or areas mentioned in the case and do an online search of dollar stores within a 5-mile radius. Does your research confirm or deny the assertion that dollar stores are closely congregated in blue-collar lower income areas? How does this concentration of dollar stores affect consumer shopping options?

Students’ responses will vary, but generally they should find that Dollar Stores are aggregated in lower income neighborhoods and regions. Discussions can lead to whether or not the focus of Dollar Stores to locate in these areas is ethical. A counter question would be if the absence of other retailers in these same areas is ethical. You could pose the following question to students based on their findings: Are retailers like Dollar Store working toward greater social justice to combat inequality?

(10 minutes, Chapter Objective 4, AACSB: Ethical Understanding and Reasoning) CS 13-3 Are companies targeting the bottom of the pyramid taking advantage of vulnerable consumers with limited resources?

This question could lead to a good discussion about the ethics of product offerings targeted at any income class. Only a small percentage of consumer products would fulfill the strictest definition of “needs.” However, if a product is not harmful and if promotion is handled in a truthful and non-deceptive manner, the marketing of the product should not be considered unethical. There is a temptation to make judgments about how people with low incomes should spend their discretionary funds. With Dollar Store, consumers can in fact find good value, but as always should do due diligence with price comparisons with other retailers.

(10 minutes, Chapter Objective 4, AACSB: Ethical Understanding and Reasoning) .

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Additional Support Material STUDENT PROJECTS Individual Projects 1.

Have students look for the parody display segments in town – for instance, the freegans, or the blue denim pants (Von Dutch) crowd. Talk to them and determine their rationale for their lifestyle and their opinions about other social classes.

When upper class individuals avoid brands this is called parody display. Students may find the reasons why interesting. However, it may be difficult to find parody display segments. (15 minutes, Chapter Objective 13-3, AACSB: Reflective Thinking)

2.

Have a student visit a high-end specialty store for a luxury good (i.e., Louis Vuitton, Coach, Burberry, etc.). Have them interview a sales associate or manager about the existence of the mass class segment. Can they identify the difference between upper-class people and middle- to lower-class people who buy the products? What are the noted differences? How prevalent are the mass culture members?

Students should find the first-hand experience of the sales associate interesting. The appeal to the mass class is likely to depend on the retailer. (30 minutes, Chapter Objectives 13-1 and 13-3, AACSB: Reflective Thinking)

3.

Conduct this as an in-class activity. Prepare a list of 15 occupations and distribute copies to the class. Ask each student to rank the occupations according to prestige. Compile the results (either during class, or after the next class period). Discuss the results with the class. Are there consistencies? Why do these form? What implications do these perceptions have on consumer behavior?

This exercise relates to the information about occupational prestige. Different people are likely to have different responses to the occupations. Students should be encouraged to explore the root of these differences. (15 minutes, Chapter Objective 13-2, AACSB: Reflective Thinking)

4.

Ask students to find at least two manufacturer’s ads for the same type of product (e.g., clothing, food product, personal care product, etc.) that they think are aimed at different social classes. How do these ads differ?

Look for students to relate the elements of the advertisement, including the social environment, the furnishings in the background, the colors used, etc. to other consumption behaviors of each social class. (20 minutes, Chapter Objective 13-1, AACSB: Reflective Thinking) .

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5.

Ask a student to bring in an ad in which the brand being marketed was at one time a status symbol but fell out of fashion for a time (e.g., Cadillac, Parker Pen, Izod-Lacoste, etc.). Have the student discuss whether the ad still attempts to create that perception.

What new product, if any, has replaced the featured product as a status symbol?

For a status symbol to distinguish a customer and show s/he has “made it,” it must be exclusive in some way. Cadillac, for example, hurt its image as a status symbol when it introduced lower priced models and offered inexpensive leases, making the brand more available to those with less money. That, coupled with the fact that it only retained appeal to an older audience that did not want the increasingly desirable foreign luxury cars, hurt its ability to continue to communicate status. (25 minutes, Chapter Objective 13-3, AACSB: Reflective Thinking)

6.

Have a student interview one or more salespeople from one of the following product categories: new or used cars, stereo equipment, clothing, insurance, or real estate. Ask the student to determine the social classes or status of their customers. Does the student recommend that the sales approach will vary depending on the customer’s social class?

The chapter notes some of the differences in how social class members shop. The student’s recommendation may be based on the salesperson’s perceptions of these differences and the student’s evaluation of whether capitalizing on the differences is ethical. (45 minutes, Chapter Objectives 13-1 and 13-2, AACSB: Ethical Understanding and Reasoning)

7.

What status symbols motivate you to purchase? Pick an example product and give an illustration.

Student responses will vary. Look for students to explain how owning the product or using the service differentiates them from those who do not own/use the product. (15 minutes, Chapter Objective 13-3, AACSB: Reflective Thinking)

8.

How can online marketers use social class in marketing efforts? Give examples of good and bad usage. Go online to do this if possible.

Students might compare sites that cater to the upper class (e.g. robbreport.com) to sites that cater to the middle class (e.g. parade.com). They also may compare retailers. Look for students to evaluate the marketing efforts critically in their responses. (45 minutes, Chapter Objectives 13-1 and 13-3, AACSB: Reflective Thinking)

9.

Ask students to compile a selection of recent ads that attempt to link consumption of a product with a specific lifestyle. In class, have students demonstrate what they have found. Discuss how the goal of linking product consumption to a lifestyle is usually accomplished.

.

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There are plenty of brands that use sports sponsorships (e.g. tennis, golf, X-games) to associate with a specific lifestyle. Well-known spokespeople can also be used to create a link. (45 minutes, Chapter Objective 13-1, AACSB: Reflective Thinking) 10.

Ask students to think of a specific lifestyle (your own, your parent’s, your aspirations, etc.) and then make a list of products and services that are linked in the consumer’s mind to that specific lifestyle. (Hint: You might decorate your living room, design a wardrobe, think of options for a car, etc.)

Student responses will vary. It may be helpful to narrow down the specific task, perhaps using the hints to select one area where the lifestyle might be reflected. (30 minutes, Chapter Objectives 13-1 and 13-3, AACSB: Reflective Thinking)

Group Projects 1.

Have student groups visit two sections of a community—one where residents are professionals and businesspeople and one where residents are mostly working class. Ask them to note how the homes vary in terms of color, architecture, and the general appearance of the lawn and landscape. Have them check the paper or call a realtor to find the general value of homes in the area. What types of stores are in the neighborhood and how are they promoted?

Look for students to identify characteristics of the homes and the retailers that serve the neighborhoods. Students may also use real estate tracking services like zillow.com in some markets to find out the value of homes in the different areas. (60 minutes, Chapter Objective 13-2, AACSB: Reflective Thinking)

2.

Ask a group to classify the major retail stores (department and specialty stores) in your community according to their estimation of the social class of their target market. Have them explain how the marketing strategy is different for each of the stores profiled.

Look for students’ descriptions of social class to go beyond income and consider education and occupation. Students should relate the marketing strategy back to the information in the chapter about how members of different social classes shop. (20 minutes, Chapter Objective 13-2, AACSB: Reflective Thinking)

3.

Ask students to make a list of slang terms that are used to disparage social classes. Why are these terms used? How do marketers disparage or make fun of social classes (which they do not target)? What is the best way to treat all classes with ethics and dignity?

Slang terms are most likely to apply to upper class and lower class categories. Students should recognize that marketer efforts to associate with one class often depend on their ability to differentiate the consumers who will use it from other social classes. Be sensitive to the fact that some of the slang may be offensive to some students. (15 minutes, Chapter Objectives 13-1 and 13-4, AACSB: Reflective Thinking)

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4.

Have your group designate which social class would most accurately describe each member’s current position. Where do the members expect to be in 5 years with respect to social class? What differences will occur if the anticipated movement in social class occurs? Discuss the changes in class.

Many people categorize themselves as middle class, which is one of the issues with selfdesignating social class. Some students may consider their own status and not the status of their parents. Many business students may aspire to be lower upper class in five years.

(25 minutes, Chapter Objective 13-2, AACSB: Reflective Thinking)

5.

Assign groups of students to go to an airport (or other location where they will find lots of foot traffic) to people watch. Have them classify as many people as possible according to social class based on the appearance and behaviors of individuals. Have the class as a whole discuss their results. What lessons can be learned from this?

It will be challenging for consumers to determine social class based on the appearance of individuals. Further, some social classes are not likely to be represented at the airport.

Students may rely on status symbols and distinguish people based on behaviors, like whether they travel business class or first class. International airports will add another layer of complexity to trying to determine the social class of individuals since status symbols in other countries are different from those in the United States. (90 minutes, Chapter Objective 13-1, AACSB: Reflective Thinking)

ONLINE ASSIGNMENTS Individual Assignments 1.

Go to www.burberry.com. How does this prestige fashion label use social class and status to sell its products? Comment on their approach. Does this approach make you want to buy such products? Explain.

Burberry.com uses a distinctive font, color scheme, and music, in addition to highly stylized photographs of its products. The products are not available to everyone because they use exclusive distribution and high price points. Student opinions about whether the products are desirable are likely to vary. (15 minutes, Chapter Objectives 13-1 and 13-3, AACSB: Reflective Thinking)

2.

Go to www.maxlang.com. How much would you pay for a belt for casual or business wear? How much does Max Lang charge? Is Max Lang selling belts or status? How can the Max Lang website overcome problems such as sizing and the desire to personally see prestige products? What do you think of the organization’s strategy?

Max Lang sells expensive belts and belt buckles, but the website design does not support the position of Max Lang belts as a status symbol. The website has a toll free number for support. The site may have to rely on reputation/word of mouth and online reviews in the absence of the ability to view the products. (15 minutes, Chapter Objectives 13-1 and 133, AACSB: Reflective Thinking) .

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Group Assignments 1.

Visit both www.macaronigrill.com and www.dennys.com. Have your group analyze the approaches that both of these websites have taken to appeal to their target markets. What elements and cues in these websites reflect the principles contained in this chapter on social status?

Both companies appeal to the masses, but Macaroni Grill appeals to a slightly higher social class. Denny’s tends to focus on the quantity of food at a low price point, while Macaroni Grill tends to focus on the quality of the food. The colors and layout used on each site are in line with their different positions. (20 minutes, Chapter Objectives 13-1 and 13-2, AACSB: Reflective Thinking)

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Chapter 14: CULTURE CHAPTER OBJECTIVES When students finish this chapter, students should be able to: 14- 1. Describe how culture is a society’s personality.

14- 2. Discuss how consumption rituals structure our experiences and convey our cultural values.

14- 3. Summarize how products, brands, and practices are vessels of cultural meanings.

14- 4. Explain how products, ideas, and practices circulate through society via the process of diffusion.

CHAPTER SUMMARY Describe how culture is a society’s personality.

A society’s culture includes its values, ethics, and the material objects its members produce. It is the accumulation of shared meanings and traditions among members of a society. We describe a culture in terms of ecology (the way people adapt to their habitat), its social structure, and its ideology (including moral and aesthetic principles).

Discuss how consumption rituals structure our experiences and convey our cultural values.

A ritual is a set of multiple, symbolic behaviors that occur in a fixed sequence and that we repeat periodically. Ritual is related to many consumption activities that occur in popular culture.

These include holiday observances, gift giving, and grooming. A rite of passage is a special kind of ritual that marks the transition from one role to another. These passages typically entail the need to acquire ritual artifacts to facilitate the transition. Modern rites of passage include graduations, fraternity initiations, weddings, debutante balls, and funerals.

Summarize how products, brands, and practices are vessels of cultural meanings.

We divide consumer activities into sacred and profane domains. Sacralization occurs when we set apart everyday people, events, or objects from the ordinary and thereby make them sacred.

Objectification occurs when we ascribe sacred qualities to products or items that sacred people once owned. Desacralization occurs when formerly sacred objects or activities become part of the everyday, as when companies reproduce “one-of-a-kind” works of art in large quantities.

Explain how products, ideas, and practices circulate through society via the process of diffusion.

Diffusion of innovation refers to the process whereby a new product, service, or idea spreads through a population. Innovators and early adopters are quick to adopt new products, and .

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laggards are slow. A consumer’s decision to adopt a new product depends on his or her personal characteristics as well as on the characteristics of the innovation itself. We are more likely to adopt a new product if it demands relatively little behavioral change, is easy to understand, and provides a relative advantage compared with existing products. The fashion system includes everyone involved in creating and transferring symbolic meanings. Many different products express common cultural categories. According to meme theory, ideas spread through a population in a geometric progression much as a virus infects many people until it reaches epidemic proportions

CHAPTER OUTLINE

I.

Cultural Systems Culture is a society’s personality.

It includes both abstract ideas and material objects and services. It is the accumulation of shared meanings, rituals, norms, and traditions among the members of an organization or society.

Consumer researchers in the consumer culture theory movement study consumer behavior with ethnography, which is a deep, longitudinal inquiry from the inside of a cultural phenomenon or group to unravel insights into the cultural processes therein.

A. Dimensions of Culture Culture is not static. 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. This includes the domestic and political groups that dominate the culture (e.g., the nuclear family versus the extended family; representative government versus dictatorship.

• Ideology—The mental characteristics of a people and the way they relate to their environment and social groups.

B. How We Learn about Our Culture The process of learning the values, beliefs, and behaviors in our own culture is called enculturation. In contrast, acculturation refers to the learning that occurs when we travel to a new culture and learn that culture’s value system and ways of doing things.

C. Dimensions of Culture One of the most widely used measures of cross-cultural values is an instrument called Hofstede dimensions of national culture.

This measure scores a country in terms of its standing on six dimensions: • Power Distance • Individualism • Masculinity • Uncertainty Avoidance • Long-Term Orientation .

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• Indulgence versus Restraint Other cultural dimensions have begun to emerge that also explain consumer behavior. One distinction is tightness-looseness, which refers to the strength of social norms, or the social pressure to behave a certain way, and the extent to which deviance from those norms is tolerated versus punished.

D. Cultural Meaning Creation and Movement We don’t form our tastes and product preferences in a vacuum. The many images mass media present to us drive our choices. These options constantly evolve and change.

How consumers use the brands or speak about the brands infuses further cultural meaning to the brand – and the cycle continues.

Many judges or “tastemakers” have a say in the products we consider. These cultural gatekeepers filter the overflow of information as it travels down the “funnel.”

E. Myths A myth is a story with symbolic elements that represents a culture’s ideals. The story often focuses on some kind of conflict between two opposing forces, and its outcome serves as a moral guide for listeners.

1. The Function and Structure of Myths Many myth stories involve binary opposition, which represents two opposing ends of some dimension (e.g., good versus evil, nature versus technology).

Often a mediating figure resolves the conflict between mythical opposing forces.

Some people create their own consumer fairy tales. They tell stories that include magical agents, donors, and helpers to overcome villains and obstacles as they seek out goods and services in their quest for happy endings.

2. Marketing the Myth Many marketers are more than happy to help us live out these fairy tales.

Corporations often have myths and legends in their history.

Use Chapter Objective 14-1 Here Use key Terms culture, ethnography, ecology, social structure, ideology, enculturation, acculturation, Hofstede dimensions of national culture, tightness-looseness, cultural gatekeeper, myth, binary opposition, and consumer fairy tales Here Use Review Questions 14-1 and 14-2 Here Use Consumer Behavior Challenges 14-15 and 14-23 Here

II.

Consumption Rituals A ritual is a set of multiple, symbolic behaviors that occurs in a fixed sequence and is repeated periodically.

A. Rituals and Community Fortress brands are items we use to perform rituals. They are called this because .

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once they become embedded in our ceremonies—whether we use them to brush our teeth, drink a beer, or shave—we’re unlikely to replace them.

Extraordinary beliefs – beliefs that either cannot be affirmed by science or that even contradict established science – are an important part of consumer rituals.

Researchers examined how people come to regard products as lucky. They looked at conditioned superstition, which occurs when consumers who don’t feel they have control over their outcomes come to associate a product that is paired with a reward with the outcome itself.

1. Ritual Artifacts and Scripts Many businesses benefit because by supplying ritual artifacts to consumers.

These are items we need to perform rituals, such as wedding rice, birthday candles, diplomas, specialized foods and beverages, and retirement watches.

In addition, people often follow a ritual script to identify the artifacts we need, the sequence in which we should use them, and who uses them. a. Grooming Rituals Virtually all of us practice private grooming rituals. These ceremonies help us to transition from our private self to our public self.

Grooming rituals express two kinds of binary opposition: private/public and work/leisure. b. Gift-Giving Rituals In a gift-giving ritual, we procure the perfect object, meticulously remove the price tag, carefully wrap the object (where we symbolically change the item from a commodity to a unique good) and deliver it to the recipient.

Researchers view gift-giving as a form of economic exchange in which the giver transfers an item of value to a recipient, who in turn must reciprocate.

However, gift-giving also involves symbolic exchange.

The gift-giving ritual proceeds in three distinct stages: 1. During gestation the giver procures an item to mark some event.

2. The second stage is presentation or the process of gift exchange.

3. In the reformulation stage, the giver and receiver redefine the bond between them (either looser or tighter) to reflect their new relationship after the exchange. The reciprocity norm obliges people to return the gesture of a gift with one of equal value. c. Holiday Rituals On holidays, we step back from our everyday lives and perform ritualistic behaviors unique to those occasions.

Halloween is an antifestival—an event that distorts the symbols we associate with other holidays.

2. Rituals as Rites of Passage Modern rites of passage are rituals we perform to mark a change in social status. Every society, both primitive and modern, sets aside times for these changes.

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Use Chapter Objective 14-2 Here Use key Terms ritual, fortress brands, extraordinary beliefs, conditioned superstition, ritual artifacts, ritual script, grooming rituals, gift-giving ritual, gestation, presentation, reformation, reciprocity norm, antifestival, and rites of passage Here Use Review Questions 14-3 and 14-4 Here Use Consumer Behavior Challenges 14-11, 14-13, 14-14, 14-17, 14-18, 14-19, 14-22, 14-27, 14-29, and 14-30 Here

III.

Products Are Vessels of Cultural Meanings We need to be aware of an item’s symbolism and whether there are people for whom its meaning is special.

A. Sacred and Profane Products Sacred consumption occurs when we “set apart” objects and events from normal activities and treat them with respect or awe. Note that in this context the term sacred does not necessarily carry a religious meaning, although we do tend to think of religious artifacts and ceremonies as “sacred.”

Profane consumption, in contrast, describes objects and events that are ordinary or everyday; they don’t share the “specialness” of sacred ones. Again, note that in this context we don’t equate the word profane with obscenity, although the two meanings do share some similarities.

Sacralization occurs when ordinary objects, events, and even people take on sacred meaning.

Objectification occurs when we attribute sacred qualities to mundane items. One way that this process occurs is via contamination whereby objects we associate with sacred events or people become sacred in their own right.

1. Collections of “Sacred” Products Collecting refers to the systematic acquisition of a particular object or set of objects. This is in contrast to hoarding, which reflects a reluctance to discard used objects.

2. Domains of Sacred Consumption •

• •

Sacred Places: A society “sets apart” sacred places because they have religious or mystical significance (e.g., Bethlehem, Mecca, Stonehenge) or because they commemorate some aspect of a country’s heritage (e.g., the Kremlin, the Emperor’s Palace in Tokyo, the Statue of Liberty, or Ground Zero in Manhattan).

Contamination makes these places sacred: Something sacred happened on that spot, so the place itself takes on sacred qualities.

Sacred People: Hundreds of fan clubs memorialize Elvis.

Sacred Events: Sometimes public events resemble sacred, religious ceremonies. .

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3. From Sacred to Profane, and Back Again Desacralization occurs when we remove a sacred item or symbol from its special place or duplicate it in mass quantities so that it loses its “specialness” and becomes profane.

B. Global Consumer Culture Many multinational firms are household names, widely recognized by literally billions of people. The dominance of these marketing powerhouses creates a global consumer culture that unites people around the world by their common devotion to brand-name consumer goods, movie stars, celebrities, and leisure activities.

County of origin (COO) is an important heuristic. Marketers often go out of their way to link a brand with a country to capitalize on associations people have with a specific COO. Ethnocentrism refers to the belief that other places are inferior to one’s own.

Use Chapter Objective 14-3 Here Use key Terms sacred consumption, profane consumption, sacralization, objectification, contamination, collecting, hoarding, desacralization, global consumer culture, country of origin (COO), and ethnocentrism Here Use Review Questions 14-5 and 14-6 Here Use Consumer Behavior Challenges 14-10, 14-12, 14-16, 14-24, 14-25, and 14-26 Here

IV.

The Diffusion of Innovations

Diffusion of innovations refers to the process whereby a new product, service, or idea spreads through a population.

An innovation is any product or service that consumers perceive to be new.

Adoption rates of an innovation can go exponential when the process reaches the moment of critical mass – what one author calls the tipping point.

A. How Do We Decide to Adopt an Innovation?

1. Types of Adopters Roughly one-sixth of the population (innovators and early adopters) are quick to adopt new products, and one-sixth (laggards) are slow. The other twothirds, so-called late adopters are somewhere in the middle. These consumers are the mainstream public. (Figure 14.2) Innovators represent about 2.5 percent of the population and marketers are eager to identify them. These are the individuals who are always on the lookout for novel products or services and who are first to try something new.

An innovator tends to be a risk-taker. He or she is likely to have a relatively high educational and income level and to be socially active. .

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Early adopters share many of the same characteristics as innovators. An important difference is their high degree of concern for social acceptance, especially regarding expressive products such as clothing and cosmetics.

2. The Gartner Hype Cycle The Gartner Hype Cycle (Figure 14.3) is a widely used approach to help analysts chart the progress of a technological innovation. Its purpose is to tease apart the “hype” from the real commercial promise of a new product or platform such as gamification or virtual reality.

This model describes five key phases of a technology’s life cycle: • • • • •

Innovation Trigger Peak of Inflated Expectations Trough of Disillusionment Slope of Enlightenment Plateau of Productivity

3. Types of Innovations Researchers identify three major types of innovations. They refer, in a relative sense, to the amount of disruption or change they bring to people’s lives.

• A continuous innovation is a modification of an existing product, such as when General Mills introduces a Honey Nut version of Cheerios or Levi’s promotes shrink-to-fit jeans. Most product innovations are of this type; they are evolutionary rather than revolutionary.

• A dynamically continuous innovation is a significant change to an existing product.

• A discontinuous innovation creates a big change in the way we live. Major inventions, such as the airplane and the computer, fall into this category.

B. What Determines If an Innovation Will Diffuse?

Regardless of how much we have to change what we do, a successful innovation should possess these attributes: • Compatibility—The innovation should be compatible with consumers’ lifestyles.

• Trialability—Because we think an unknown product is risky, we’re more likely to adopt an innovation if we can experiment with it before making a commitment.

• Complexity—The product should be low in complexity. All things being equal, we will choose a product that’s easier to understand and use rather than a more complex one.

• Observability—Innovations that are readily apparent are more likely to spread because we can learn about them more easily.

• Relative advantage—The product should offer relative advantage over alternatives. The consumer must believe that it will provide a benefit other products cannot offer. .

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C. The Diffusion of Consumption Practices Practices are “routinized things people do, say, and understand” that are situated within a larger system of social structures. These practices often move from one context to another, acquiring new “carriers,” taking on new meanings, and influencing other practices. This process is known as practice diffusion.

One widely used approach to predicting whether people will adopt a new form of technology or information system is the Technology Acceptance Model (TAM).

TAM suggests that the likelihood of change is based on two factors: the perceived usefulness of the new option and its perceived ease of use.

D. The Fashion System The fashion movement known as normcore reflected an effort by young Bohemian types to “get over themselves.” They devoted tremendous effort to set themselves apart from others with quirky style flourishes like handlebar moustaches and drinking obscure microbrews, and so they felt a need to throw themselves back into mainstream culture.

1. Fashion Is about a Lot More Than Paris Runways The fashion system includes all the people and organizations that create symbolic meanings and transfer those meanings to cultural goods.

Cultural appropriation occurs when individuals or companies who belong to a dominant cultural group adopt a minority group’s cultural symbols in an exploitative, stereotypical, or disrespectful manner.

2. The Spread of Memes A meme is an idea or product that enters the consciousness of people over time. Memes travel fast, and when they make fun of brands, they can hurt.

Memes spread among consumers in a geometric progression just as a virus starts off small and steadily infects increasing numbers of people until it becomes a pandemic.

E. Consumers as Sources of Innovations Today some marketers have figured out that their customers are the best source for new product ideas. This is the logic behind crowdsourcing, which describes the growing practice of soliciting ideas for new products and even advertising campaigns from a user community.

The process of value co-creation emphasizes the involvement of consumers both in the production and design process and in the product use process.

The wisdom of crowds perspective argues that, under the right circumstances, groups are smarter than the smartest people in them. If this is true, it implies that large numbers of consumers can predict successful products.

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Use Chapter Objective 14-4 Here Use key Terms diffusion of innovations, innovation, adoption rates, tipping point, laggards, late adopters, innovators, Gartner Hype Cycle, continuous innovation, dynamically continuous innovation, discontinuous innovation, compatibility, trialability, complexity, observability, relative advantage, practices, practice diffusion, Technology Acceptance Model (TAM), fashion system, cultural appropriation, meme, crowdsourcing, co-creation, and wisdom of crowds Here Use Review Questions 14-7 and 14-8 Here Use Consumer Behavior Challenges 14-9, 14-20, 14-21, 14-28, and 14-31 Here

End-of-Chapter Support Material

REVIEW QUESTIONS 14-1. What is culture? List three dimensions social scientists used to describe a culture and give an example of each.

We can think of culture as a society’s personality. It includes both abstract ideas, such as values and ethics, and material objects and services, such as the automobile, clothing, food, art, and sports that are produced or valued by a society. Put another way, culture is the accumulation of shared meanings, rituals, norms, and traditions among the members of an organization or society.

• Ecology—The way a system adapts to its habitat. Ecology is shaped by the technology a culture uses to obtain and distribute resources (e.g., industrialized societies versus Third World countries). The Japanese, for example, greatly value products designed for efficient use of space because of the cramped conditions in that island nation.

• Social structure—The way in which orderly social life is maintained. This includes the domestic and political groups that are dominant within the culture (e.g., the nuclear family versus the extended family; representative government versus dictatorship).

• Ideology—The mental characteristics of a people and the way in which they relate to their environment and social groups. This revolves around the notion that members of a society possess a common worldview. They share certain ideas about principles of order and fairness. They also share an ethos, or a set of moral and .

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aesthetic principles. A theme park in Bombay that caters to India’s emerging middle class, called Water Kingdom, illustrates how a culture’s worldview can be distinctive. Many consumers there are unfamiliar with mixed-sex public activities of this nature, so the park rents swimsuits to women who have never worn one before.

No thongs here, though: The suits cover the women from wrists to ankles. (20 minutes, Chapter Objective 14-1, AACSB: Diverse and Multicultural Work Environments) 14-2. A myth is a special kind of story. What makes it special? What is an example of a modern myth?

A myth is a story containing symbolic elements that express the shared emotions and ideals of a culture. It often features a conflict between two opposing forces. It often sets good against evil. It reduces anxiety because it provides consumers with guidelines about their world. An example of the modern myth is fairy tale weddings that Disney stages for couples that want to enact their own version of a popular fairy tale. (5 minutes, Chapter Objective 14-1, AACSB: Reflective Thinking)

14-3. What is a ritual? Describe three kinds of rituals and provide an example of each.

A ritual is a set of multiple, symbolic behaviors that occur at a variety of levels. Three kinds of rituals are: gift-giving rituals (ex. Christmas gifts), holiday rituals (ex. wearing costumes for Halloween), and grooming rituals (ex. bathing). (10 minutes, Chapter Objective 14-2, AACSB: Application of Knowledge) 14-4. List the three stages of a rite of passage ritual.

A rite of passage consists of three phases, separation, liminality, and aggregation. For example, when a student leaves for college they will experience the three phases. In the first stage, separation, he detaches from his original group or status as a high school kid and leaves home for campus. Liminality is the middle stage, where he is in limbo between statuses. Think of those bewildered new first-year students who try to find their way around campus during orientation. In the aggregation stage, he returns to society with his new status. Our hero returns home for Thanksgiving break as a cocky college “veteran.” (5 minutes, Chapter Objective 14-2, AACSB: Reflective Thinking) 14-5. What is the difference between sacred and profane consumption? Provide one example of each.

Sacred consumption involves objects and events that are “set apart” from normal activities and are treated with some degree of respect or awe. They may or may not be associated with religion, but people tend to regard most religious items and events as sacred. An example of this might be a once-in-a-lifetime round-the-world cruise. Profane consumption involves consumer objects and events that are ordinary, everyday objects and events that do not share the “specialness” of sacred ones. An example of this might .

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be going mall shopping on the weekend. (5 minutes, Chapter Objective 14-3, AACSB: Application of Knowledge) 14-6. How is a collection sacred? What is the difference between collecting and hoarding?

Collecting refers to the systematic acquisition of a particular object or set of objects.

Collecting expensive cars is a sacred experience for a few. A car might be sacralized as soon as it enters a collection and it takes on a special significance to the collector that outsiders may find hard to comprehend. We can distinguish this activity from hoarding, which is merely unsystematic collecting. Hoarding is becoming a problem in some areas where consumers’ refusal to throw things away in some extreme cases has resulted in fires, eviction, and even the removal of children from the home. (5 minutes, Chapter Objective 14-3, AACSB: Reflective Thinking)

14-7. Who are innovators? Early adopters? Laggards?

Roughly, one-sixth of the population (innovators and early adopters) are very quick to adopt new products, and one-sixth of the people (laggards) are very slow. Even though innovators represent only about 2.5 percent of the population, marketers are always interested in identifying them. These brave souls are always on the lookout for novel products or services and who will be the first to try a new offering. Just as generalized opinion leaders do not appear to exist, innovators tend to be category-specific as well.

Early adopters share many of the same characteristics as innovators, but an important difference is their degree of concern for social acceptance, especially with regard to expressive products, such as clothing, cosmetics, and so on. (5 minutes, Chapter Objective 4-4, AACSB: Reflective Thinking) 14-8. What is an example of a meme?

A meme is an idea or product that enters the consciousness of people over time— examples include tunes, catch phrases (“You’re fired!”), or styles such as the Hush Puppy. (5 minutes, Chapter Objective 14-4, AACSB: Reflective Thinking) CONSUMER BEHAVIOR CHALLENGE Discuss 14-9. This chapter discusses the perils of cultural appropriation, where a company borrows symbolism from a specific culture for its own purposes. While many critics abhor this practice, others point to the role that fashion plays in exposing people to other cultures.

What’s your take—is cultural appropriation a problem, or just a “compliment” for the culture that provides the symbols?

Student responses will vary. The discussion may include the adoption of symbols in an exploitative, stereotypical, or disrespectful manner. Victoria Secret’s use of this practice .

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may be discussed. (5 minutes, Chapter Objective 14-4, AACSB: Reflective Thinking) 14-10. The allure of U.S. consumer culture spreads throughout the world but with a lot of pushback in many places. Critics in other countries deplore the creeping Americanization of their cultures because of what they view as excessive materialism. One French critic summarized this resistance to the diffusion of U.S. culture: He described the Euro Disney theme park as “a horror made of cardboard, plastic, and appalling colors—a construction of hardened chewing gum and idiotic folklore taken straight out of a comic book written for obese Americans.” What is your reaction to these criticisms?

While a variety of reactions will be shared, a discussion should include ethnocentrism.

(5 minutes, Chapter Objective 14-3, AACSB: Reflective Thinking) 14-11. Many colleges boast unique rituals in which students engage in some scripted group activity, though in recent years, some institutions have abolished these because of safety concerns or because the rituals encourage underage drinking. Casualties include spring couch burning at the University of Vermont, and Texas A&M’s bonfire on the eve of the annual football game against the University of Texas (the bonfire ritual has since been revived off campus). However, UC–Santa Barbara still offers an Undie Run. Naked Harvard students let off steam just before finals in The Primal Scream, and Yale seniors run naked through campus libraries at the end of each semester to toss candy at underclass students as they cram for finals. Denison University celebrates Naked Week and Tufts has a Naked Quad Run. What is your feeling about these rituals? Should universities encourage them?

Students may draw on the many examples shared in the press over the past few years.

Feelings will definitely vary across students. (15 minutes, Chapter Objective 14-2, AACSB: Reflective Thinking) 14-12. “Disney World is a sacred place.” Do you agree? Why or why not?

This question should be used to make sure that students understand the definition of “sacred” as it applies in consumer behavior (objects and events that are “set apart” from normal activities and are treated with some degree of respect or awe). Once they understand this, most all should agree that Disneyland is a sacred place to some . . . to many. (5 minutes, Chapter Objective 14-3, AACSB: Reflective Thinking) 14-13. Describe the three stages of the rite of passage associated with graduating from college.

The rite of passage includes three phases: 1. Separation—detached from original group (e.g., college freshman leaves home).

2. Liminality—person is literally in between statuses (e.g., freshman during orientation).

3. Aggregation—person reenters society after rite of passage (e.g., goes home for Christmas as a “college veteran”).

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For the college graduation example: 1. Students should recognize the college graduate’s separation involves detachment from his or her college friends, roommates, fraternity brothers/sorority sisters, and professors.

2. During the liminality phase, the college graduate is in between stages—college and career—and experiences a period of adjustment to the new environment.

3. Aggregation occurs when the graduate becomes part of the professional society, identifying with his or her career rather than college. (10 minutes, Chapter Objective 14-2, AACSB: Reflective Thinking) 14-14. Have you ever given yourself a gift? If so, why did you do it and how did you decide what to get?

Research has shown that the most common reasons that people buy themselves gifts are to reward themselves for good deeds, to console themselves after negative events, or to motivate themselves to accomplish some goal. As students respond, relate their responses to these reasons for buying self-gifts. (5 minutes, Chapter Objective 14-2, AACSB: Reflective Thinking) 14-15. Identify modern-day myths that corporations create. How do they communicate these stories to consumers?

Student responses will vary based on the myths they identify. A myth is a story with symbolic elements that represents a culture’s ideals. The story often focuses on some kind of conflict between two opposing forces, and its outcome serves as a moral guide for listeners. In this way, a myth reduces anxiety because it provides consumers with guidelines about their world. Most members of a culture learn these stories, but usually we don’t really think about their origins. In some cases, marketers adapt these stories and (perhaps unconsciously) pattern their messages along a mythic structure. Myths serve four interrelated functions in a culture: metaphysical (they help explain the origins of existence), cosmological (they emphasize how components of the universe are interrelated), sociological (they maintain social order), and psychological (they provide models of personal conduct). (10 minutes, Chapter Objective 14-1, AACSB: Reflective Thinking) 14-16. In the last few years, our culture has been shocked by revelations regarding sexual harassment by famous artists, actors, executives, and others as the #MeToo movement accelerated. Prominent companies including Volkswagen, Mercedes-Benz, Hugo Boss, Bayer, IBM, and Kodak had ties to Nazi Germany. Aetna and New York Life profited by selling insurance policies to slaveowners. Yet we value their products today. To what extent can or should we separate the creator from the creation? Should we buy products or services that are “tainted” by their owners’ or companies’ unsavory past actions?

Student responses will vary based on their own personal beliefs. It is important to cover in this question the fact that what is acceptable (or normal) in a culture may very well change over a period of time. Socially (culturally) acceptable actions of one era may not .

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necessarily be viewed in the same light by a later era. However, that does not mean that the actions of the past are to be viewed through the lens of today. (15 minutes, Chapter Objective 14-3, AACSB: Reflective Thinking, Ethical Understanding and Reasoning) 14-17. “Christmas has become just another opportunity to exchange gifts and stimulate the economy.” Do you agree? Why or why not?

To some extent, the answer to this question will reflect each student’s upbringing, their appreciation of this religious event and season, their sense of tradition, and their cynicism. Marketers and consumers are both to blame for the over-commercialization of the season. Many, however, still regard this season as one of the most religious on the calendar. Have students talk about Christmas traditions. Most can remember more traditions than details of presents they have received or given. Ask them to describe how their family feels about Christmas (from their mother and father’s standpoint). Is the Christmas season a time for family renewing and gathering (most will say yes)? This question should provide for a lively debate. Be sure to include the marketing aspects of the season and whether this is right or wrong. (10 minutes, Chapter Objective 14-2, AACSB: Reflective Thinking) 14-18. Bridal registries specify very clearly the gifts that the couple wants. How do you feel about this practice? Should people actually specify what you should buy for them, or should a gift be a more personal expression from you?

There should be representatives that emerge to support both sides of this debate.

Although, because this practice has become so culturally accepted, younger people will probably see nothing wrong with it. However, traditionally, the nature of gift giving was more symbolic in nature. Part of gift giving is developing or reinforcing a symbolic relationship, but now the process is much more automated. (10 minutes, Chapter Objective 14-2, AACSB: Reflective Thinking) 14-19. Rituals can provide us with a sense of order and security. In a study of the drinking rituals of college students, the researchers found that drinking imposed order in students’ daily lives—from the completion of assignments to what and when to eat. In addition, ritualizing an activity such as drinking provided security and fellowship at a time fraught with confusion and turbulent change. Obviously, though, there is a dark side to drinking rituals. Consider the highly publicized death of a Massachusetts Institute of Technology student who died three days after falling into an alcohol-induced coma as the result of a fraternity pledge. Indeed, binge drinking is probably the most widely practiced ritual among college students; it has been described as the most significant health hazard on college campuses today. What role does drinking play in the social life on your campus?

Based on your experience, how does it fit into rituals of college life? Should these practices be changed? If so, how?

Student responses will likely mirror the research on this topic; the majority of students at some point in their college experience are involved in ritualistic drinking. Thus, most everyone will have something to share—some (obviously) more than others will. Their .

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responses to whether or not such practices should be changed will likely be based on whether or not they have had or have witnessed any negative experiences associated with drinking. (15 minutes, Chapter Objective 14-2, AACSB: Reflective Thinking) 14-20. Movie companies often conduct market research when they produce big-budget films. If necessary, they will reshoot part of the movie when viewers say they do not like it. Some people oppose this practice: They claim that movies, like books, songs, plays, and other artistic endeavors, should not conform to what the market wants, lest they sacrifice their integrity. What do you think?

The instructor should encourage students to review the relevant discussion in the text concerning aesthetic marketing research and then express their thoughts and feelings regarding the use of consumer research for these purposes. Considering these practices in light of the marketing concept should generate an interesting discussion. (15 minutes, Chapter Objective 14-4, AACSB: Reflective Thinking) 14-21. Boots with six-inch heels were a fashion rage among young Japanese women a few years ago. Several teens died after they tripped over their shoes and fractured their skulls.

However, followers of the style claimed they are willing to risk twisted ankles, broken bones, bruised faces, and other dangers the platform shoes caused. One teenager said, “I’ve fallen and twisted my ankle many times, but they are so cute that I won’t give them up until they go out of fashion.” Many consumers around the world seem to be willing to suffer for the sake of fashion. Others argue that we are merely pawns in the hands of designers who conspire to force unwieldy fashions down our throats. What do you think?

What is and what should be the role of fashion in our society? How important is it for people to be in style? What are the pros and cons of keeping up with the latest fashions?

Do you believe that we are at the mercy of designers?

Another question is very opinion oriented. Responses will largely be based on how consumers view fashion and how willing they are to sacrifice to incorporate fashion into their lives. The “should” element of this question may bring forward some idealistic responses. Most students will likely take the approach that consumers are free to do as they choose, and that fashion “should” be what consumers want it to be. (15 minutes, Chapter Objective 14-4, AACSB: Reflective Thinking)

14-22. Identify the ritual elements of a football game.

A ritual is a set of multiple, symbolic behaviors that occurs in a fixed sequence and is repeated periodically. A football game provides the perfect setting to practice and experience multiple rituals including dressing up for the game in the colors of your “home” team, chanting, and the consumption of food and drink in a group atmosphere to name a few. Many more examples exist. (15 minutes, Chapter Objective 14-2, AACSB: Reflective Thinking) 14-23. The chapter states that a culture is a society’s personality. If your culture were a person, .

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Section 4: Consumers in Their Social and Cultural Settings

how would you describe its personality traits?

Responses to this question will vary greatly. (10 minutes, Chapter Objective 14-1, AACSB: Reflective Thinking) APPLY 14-24. Over the years, the McDonald’s fast-food chain has tried to modify its menu to appeal to people in different cultures. In India, the company doesn’t sell any of its famous beef hamburgers. Instead, it offers customized entrées such as a Pizza McPuff, McAloo Tikki (a spiced-potato burger), and a Paneer Salsa McWrap. Still, like many other marketers, the company has come under fire for ignoring cultural sensitivities. Back in 1994 during the soccer World Cup, the fast-food giant reprinted the Saudi Arabian flag, which includes sacred words from the Koran, on disposable packaging it used in promotions.

Muslims around the world protested this borrowing of sacred imagery, and the company had to scramble to correct its mistake. Still, McDonald’s keeps trying—it recently introduced the McVegan in its stores in Finland and Switzerland. Research McDonald’s menus in a few different countries. What evidence can you find that the company has adapted its offerings to local tastes? Do you see any opportunities it is missing?

Responses to this question will vary greatly. Students should be encouraged to think creatively.

(10 minutes, Chapter Objective 14-13, AACSB: Reflective Thinking)

14-25. People in Thailand are preoccupied with supernatural forces. One common sight is a “spirit house,” a miniature dwelling intended for protective ghosts. Some include electric wiring and indoor lighting: you will even find them in 7-Eleven convenience stores throughout the country. Thais spend about $63 million per year on visits to fortune tellers. Stores sell amulets for good luck next to breath mints, and horoscope books next to junk food. There are YouTube channels devoted to fortune telling and computer programs like “Feng Shui Master.” Which supposedly helps to predict the future of gold prices.

How do consumers in the United States compare? Interview people you know about any “magic” items they own (e.g. how many of your friends have a lucky charm or hang a St. Christopher medal or some other object from their rearview mirrors?) Get them to describe their feelings about these objects and tell how they acquired their magical properties. How would they feel if they lose these special items?

The nature of “magic” as described in the text simply refers to the fact that marketers of many different types of goods will imply that their product will result in extraordinary effects. Most people will probably refer to items in their possession around which they themselves have somehow developed a sense of the supernatural. Be sure to make special note of any student who responds with an example that demonstrates that a company has actually played a role in the development of such perceptions. (60 minutes, Chapter Objective 14-3, AACSB: Reflective Thinking) .

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14-26. Interview people you know who collect some kind of object. How do they organize and describe their collections? Do you see any evidence of sacred versus profane distinctions?

The very nature of collecting should result in people applying some element of sacredness to the items being collected. However, there will likely be a range, with items that are more sacred and items that are less sacred. (45 minutes, Chapter Objective 14-3, AACSB: Reflective Thinking) 14-27. Ask friends to describe an incident where they received a gift they thought was inappropriate. Why did they feel this way, and how did this event influence the relationship between them and the gift giver?

According to the text, research has shown that gift giving is more exchange-oriented (instrumental) in the early stages of a relationship but becomes more altruistic as the relationship develops. In addition, third parties can exert strong influences on gift giving as others influence people in their social network when selecting gifts for recipients. So, student responses to this question should depend upon which stage of a relationship the gift giving took place in. However, given that this perspective on gift giving identifies a social and relationship component, a gift perceived as inappropriate will certainly affect the relationship between the receiver and the giver. (30 minutes, Chapter Objective 14-2, AACSB: Reflective Thinking) 14-28. U.S. television inspires knockoffs around the world. But to be fair, many U.S. viewers don’t realize that U.S. reality show hits such as Big Brother and American Idol started out as European concepts that U.S. producers imported. In fact, the U.K. version of Big Brother briefly went off the air after a fight broke out and housemates threatened to kill each other. In contrast, a Malaysian show that borrows the American Idol format is called Imam Muda (Young Leader). Contestants debate religious topics and recite passages from the Koran. The winner doesn’t get a recording contract. Instead, he receives a job as an imam, or religious leader; a scholarship to study in Saudi Arabia; and an all-expensespaid pilgrimage to Mecca, Islam’s holiest city. See whether you can identify foreign versions of reality shows. You should be able to find them online. How have the creators of these programs adapted them to appeal to local customs?

This will be an interesting question for class discussion on variations in values.

(12.5 hours, Chapter Objective 14-4, AACSB: Reflective Thinking 14-29. The chapter states that experience-oriented gifts (e.g., lessons) do more to strengthen the relationship between givers and receivers than do material gifts. How might a marketer in the travel industry apply this insight to their own efforts?

Experiential gifts (e.g., sky-diving lessons) strengthen relationships between givers and receivers more than material gifts (e.g., a set of wine glasses), regardless of whether the recipient actually consumes the gift in the company of the gift giver. This fact is the key to answering this question. Just providing the gift, whether or not the receiver actually .

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Section 4: Consumers in Their Social and Cultural Settings

“cashes it in” goes a long way to building goodwill. (C10 minutes, Chapter Objective 142, AACSB: Reflective Thinking)

14-30. Death also involves rites of passage. Funeral ceremonies help the living organize their relationships with the deceased. Action is tightly scripted, down to the costumes (e.g., the ritual black attire, black ribbons for mourners, the body laid out in its best clothes) and specific behaviors (e.g., sending condolence cards or holding a wake). Passing motorists award special status to the cortege (the funeral motorcade) when they obey the strong social norm that prohibits cutting in as the line of cars proceeds to the cemetery. Funeral practices vary across cultures, but they’re always rich in symbolism. Compare and contrast funeral rituals in another country versus those we typically see at American death ceremonies.

Student responses will vary depending on the country of comparison. (C10 minutes, Chapter Objective 14-2, AACSB: Reflective Thinking) 14- 31. The chapter discusses the Gartner hype cycle, and it describes five stages in the cycle.

Identify three current tech innovations (e.g., virtual reality, drones, etc.), and pinpoint where you believe each new product fits in the cycle.

Students may discuss the innovations and discuss why they believe each is at a designated stage in the cycle. (C10 minutes, Chapter Objective 14-4, AACSB: Reflective Thinking)

Case Study: Twist, Lick, and Dunk! Does it Make Oreos Taste Better?

Summary of Case Many Oreo consumers follow the “Twist, Lick, and Dunk” practice, which is an example of a food ritual. One study found that these food rituals may actually enhance our enjoyment of the food we eat. Mondelēz, the maker of Oreos, has invested heavily in promotional activity designed to help us remember how to eat its cookie, including TV and social media ads.

Suggested Answers for Discussion Questions CS 14-1. What other food categories or brands have rituals associated with them? If you are a participant in one or more of those rituals, do you agree with the study referenced above that this ritual increases your enjoyment of the food?

You can help students with ideas by suggesting categories like fast food or candy or foods associated with specific meals such as breakfast. Students should consider whether the rituals increase their interest in the food, create a memory associated with eating it, or just makes it more fun, particularly when others are participating in the same ritual along with them. .

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Chapter 14: Culture

(10 minutes, Chapter Objective 2, AACSB: Reflective Thinking) CS 14-2. Choose a food brand without an apparent ritual and come up with one that could be used in a promotional activity. (No dunking allowed.)

Students’ answers will vary depending on the brand chosen. Rituals could involve preparation, how the food is served, cut, folded, speed of consumption, etc.

(10 minutes, Chapter Objective 2, AACSB: Application of Knowledge) CS 14-3. How could Oreo assess the impact of the twist, lick, and dunk ritual? Create a simple experiment that could provide Oreo marketers with data to judge the role that the ritual plays in some marketing metric of interest (e.g., brand loyalty, likely increased frequency of purchase, or differentiation from competitive offerings).

Subjects could be presented with Oreos and competitive cookies and could be asked how they would describe the optimal way to eat each to see how pervasive the ritual is. Another approach would be to ask the subject which of the cookie brands is associated with Twist, Lick, and Dunk.

Subjects could be presented with Oreos and asked to describe the ritual/saying associated with the brand.

(10 minutes, Chapter Objective 2, AACSB: Reflective Thinking)

MULTIPLE CHOICE QUESTIONS 1. __________ are sets of multiple, symbolic behaviors that occur in a fixed sequence and are repeated periodically. a. Rituals b. Styles c. Systems d. Consumer fairy tales e. Myths Correct response: a Rituals are sets of multiple, symbolic behaviors that occur in a fixed sequence and are repeated periodically. Rituals are an important component of culture and are often associated with food consumption.

2. One study discovered that people who performed the Oreo cookie ritual of twist, lick, and dunk enjoyed their food more and __________. a. ate more cookies b. were willing to pay more for the product c. were susceptible to advertising manipulation d. were more willing to try new products e. were prone to obesity .

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Section 4: Consumers in Their Social and Cultural Settings

Correct response: b One study discovered that people who performed the Oreo cookie ritual of twist, lick, and dunk enjoyed their food more and were willing to pay more for the product relative to those who did not perform the ritual.

3. Since Oreo cookies are the featured product in the twist, lick, and dunk ritual, the Oreo cookie could be considered a __________. a. gift-giving product b. normcore c. fortress brand d. fad e. fashion Correct response: c From the chapter: A study the BBDO Worldwide advertising agency conducted illustrates the close relationship between brands and rituals. It labels items that we use to perform our rituals fortress brands because once they become embedded in our ceremonies—whether we use them to brush our teeth, drink a beer, or shave—we’re unlikely to replace them.

4. Which of these cultural shifts threatened the Oreo cookie ritual? a. A change in U.S. demographics b. An aging population c. A change in consumption preferences d. Concern over childhood obesity e. A decline in dental insurance coverage Correct response: d Concern over childhood obesity reduced the sales of Oreo cookies. The firm also quit advertising in schools and many schools pulled Oreo cookies from their vending machines.

5. Which of these cultural factors also impacted the sales of Oreo cookies? a. Smartphone adoption b. Graying population c. Increasing diversity d. Increased competition e. Decline in rituals Correct response: a The widespread adoption of smartphones also impacted the sales of Oreos. Prior to smartphones, consumers waiting in line to be checked out were prime targets for impulse purchases. These consumers are now looking at their smartphones instead.

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Chapter 14: Culture

Additional Support Material STUDENT PROJECTS Individual Projects 1.

Invite someone from the funeral industry to come to talk to the class on marketing practices in the industry. Ask students to collect literature from various funeral homes to study before the guest speaker’s visit. Have students formulate questions before the class.

This exercise will increase student familiarity with rituals and ritual artifacts. The funeral business has high margins because of the perceived importance of the rituals. (40 minutes, Chapter Objective 14-2, AACSB: Reflective Thinking,)

2.

Invite someone from the wedding industry to come to talk to the class on marketing practices in the industry. Ask students to collect literature from various wedding-related businesses to study before the guest speaker. Have students formulate questions before the class.

Similar to #1, this will increase student familiarity with rituals and ritual artifacts. You can assign both and have students do a comparison between the two industries. (40 minutes, Chapter Objective 14-2, AACSB: Reflective Thinking)

3.

Ask students to identify what they perceive to be a sacred place on campus. How is this place honored? Marketed? How is information about this place passed on to future students? How does the university or college use this sacred place to market the university or college? Is this proper?

This exercise is more appropriate on campuses that have longstanding traditions.

Students will have different opinions about whether it is appropriate to market the tradition that makes the place sacred. (20 minutes, Chapter Objective 14-3, AACSB: Reflective Thinking)

4.

Have students interview two people from two different foreign cultures. Have the students ask what major differences they see between the cultural values in their country and those in the American culture. Ask the students to explain these to the class.

American core values are likely to include: freedom, youthfulness, achievement, materialism, activity, conformity, individuality, efficiency, etc. Core values from the other culture will vary by culture. (10 minutes, Chapter Objective 14-3, AACSB: Reflective Thinking)

5.

Ask students to describe rituals they follow when visiting a shopping mall, movie theater, or restaurant. How could marketers capitalize on these rituals?

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Section 4: Consumers in Their Social and Cultural Settings

Rituals might include stopping at the food court, throwing change in the fountain to make a wish, saying grace before eating, buying popcorn and Junior Mints, etc. Some of the rituals will be easier to commercialize. (10 minutes, Chapter Objective 14-2, AACSB: Reflective Thinking) 6.

Have students comment on the practice of drinking while attending college. What are their opinions and perceptions of the role of drinking in the college experience? Is it ritualistic? If so, how do marketers capitalize on this ritual? If a college really wanted to discourage drinking, what would be the best way to do this culturally?

Some students may think of binge drinking as a rite of passage and part of the collegiate process. It would be difficult for a college to change this cultural norm in many cases since it is reinforced by other students’ behavior and in the media (TV, movies, advertising). Universities try to change the ritual through education and by offering alternative activities. (20 minutes, Chapter Objective 14-2, AACSB: Reflective Thinking)

7.

Each student should identify and describe a possession that most people would consider ordinary, but to them is sacred. Have them describe how this sacredness developed.

Students should select a possession that is set apart and special in some way. Look for students to explain how the possession became objectified and use the discussion to reinforce the concept of contamination, where objects we associate with sacred events or people become sacred in their own right. (10 minutes, Chapter Objective 14-3, AACSB: Reflective Thinking)

8.

Visit an upscale-fashion department store or boutique. Interview the manager about fashion. How does the manager decide on which fashion merchandise to purchase? What does he or she do with fashion merchandise once it has run its course? How does he or she know when a fashion is becoming unfashionable? Relate your results to the class.

Many buyers will be centralized, so students may have more luck with these questions at a small, privately owned boutique than at a chain or department store. Look for students to relate the responses to the fashion life cycle discussed in the chapter. (30 minutes, Chapter Objective 14-4, AACSB: Reflective Thinking)

Group Projects 1.

Have student groups research and report on how student cultures are being affected by the spread of social networking phenomenon. Is social networking sacred or profane consumption? What are its positive and negative effects?

Students are likely to argue that social networking is profane since it has been adopted by the masses and is not special. They are likely to have differences of opinions about the .

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positive and negative effects, but should recognize the ability to constantly update others on what you are doing helps connect people. However, it also may lead to over sharing, which is particularly problematic when the information or visual shared has a negative impact on the sharer’s reputation. (30 minutes, Chapter Objective 4-3, AACSB: Reflective Thinking) 2.

Have student groups identify an American custom, more, and convention. Then, have them design a new product or service (or multiple if necessary) that would take advantage of the existence of these crescive norms.

Look for students to label the custom, more, and convention. Customs are norms that control basic behaviors, mores are customs that involve taboos/forbidden behavior and have a strong moral overtone, and conventions are norms that regulate how we conduct our lives. (10 minutes, Chapter Objective 4-3, AACSB: Reflective Thinking)

3.

Have student groups identify what they feel is the most sacred symbol on campus and establish the reasons for this. Then, have the class come together and compare their results.

Sacred symbols often become sacred because of an event or an individual that rubbed off on the symbol. Students should recognize that some symbols that are on the list might be categorized as profane if they are desacralized. (20 minutes, Chapter Objective 14-3, AACSB: Reflective Thinking)

4.

Ask groups to compare a list of rituals that will probably be performed (or that were performed) at their wedding ceremony and reception. What are the marketing implications of these rituals? (It is interesting to point out the different rituals based on a religious, ethnic, or racial subculture and rituals that seem to be solely American.) An added question might be: How are wedding plans affected when people from different subcultures get married?

This project is an extension of Individual Project #2. Students should do outside research on the rituals and the role of subculture in the rituals. (40 minutes, Chapter Objective 142, AACSB: Reflective Thinking)

5.

Ask each group to design a new holiday to be implemented in the nation. This holiday should have a theme, a date for celebration, and a unique idea that could be marketed.

Have the class vote on the best idea.

You can bring up George’s holiday on Seinfeld, Festivus, to help get students thinking about what types of holidays might be proposed. (20 minutes, Chapter Objective 14-2, AACSB: Reflective Thinking)

ONLINE ASSIGNMENTS

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Section 4: Consumers in Their Social and Cultural Settings

Individual Assignments 1.

Go to www.menscience.com. Everyone has grooming rituals. Examine this website and the implications that it has for male grooming. Describe how the design of the website seeks to enhance male grooming rituals that would then require the use of products that they sell.

The website sells products for shaving, which most men do, but also encourages men to have a daily regimen for facial care, for fitness, for anti-aging, and for grooming other body hair. It provides information and sells products to support these grooming rituals.

(10 minutes, Chapter Objective 14-2, AACSB: Reflective Thinking)

2.

Go to www.elvis.com. After exploring this website, comment on the myth and legend of Elvis Presley. What marketing techniques are used? How has “the King” been able to retain a loyal following after all these years? Using data found on the website, construct a brief strategy for introducing the Presley music to today’s teen generation. Do not treat this as an impossible task. How would “the King” do it if he were alive today?

Remember, teens from the ’50s made him a superstar.

Students may rely on some of the information from Chapter 12, in addition to the information about myths and marketing and from the website, to support their recommendations regarding marketing Presley music to today’s teens.

(10 minutes, Chapter Objectives 14-1 and 14-3, AACSB: Reflective Thinking)

3.

Visit www.cocacola.com and access their websites in various countries. Are the countryspecific websites different? What are the main points of difference? What are the commonalities?

Students will be able to observe that the communications and the products (including packaging and flavors, in some cases) vary by country. Communications may reflect differences in values and language. Students can also look at the country-specific Facebook pages.

(20 minutes, Chapter Objective 14-3, AACSB: Reflective Thinking)

4.

Go to www.dkny.com and www.esteelauder.com. What is new in fashion, style, and cosmetics? Either of these sites might give you some clue. After visiting the websites, list what you perceive to be the top five trends in female fashion for this year. Remember, fashion may be more than just clothing. Report your opinions to the class.

The content on both of these websites is changed on a regular basis, so you may want to visit the sites to develop your own ideas before assigning the project to the students.

(20 minutes, Chapter Objective 14-4, AACSB: Reflective Thinking)

Group Assignments 1.

Go to www.marvel.com and www.dccomics.com. After visiting these two websites, have your group discuss and comment on the use of heroes and antiheroes in these two organizations’ products and websites. What magical qualities have been bestowed on the .

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characters you have found? How are these characters used to deliver messages? How have marketers used these characters for merchandising purposes? Why do these characters remain popular? Which is your group’s favorite? Why? When you discuss the heroes and antiheroes, see if the students can relate the comic book characters’ personalities to any brand personalities. Which marketers try to create magical qualities on brands using similar story development to those used in the comics?

If students cannot think of any examples, do students feel it would be effective for any brands?

(30 minutes, Chapter Objective 14-3, AACSB: Reflective Thinking) 2.

Go to www.snopes.com. As a group, spend some time on this website. Then, choose an urban myth that you find most interesting (regardless of whether it is true or not). Apply the four interrelated functions of myths to the one that you chose. How can the concept of binary opposition be applied to the myth that you chose? In your opinion, has the Internet made urban myths and legends more commonplace? Why? When two opposing ends of some dimensions are represented this is called binary opposition. Characters or products are often characterized as to what they “are not” rather than what they “are.”

(20 minutes, Chapter Objective 14-1, AACSB: Reflective Thinking)

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Appendix A

APPENDIX A

Section 1: Analyzing the Athletic Shoe Market Brief Description of the Data The data from the 2022 MRI Simmons data about different athletic shoe brands includes information about the markets (e.g., Market Segment Size, Estimate Count, Percentage of Total, Percentage within Market Segment Who Bought in the Last Year, and the Index).

Suggestions for Presentation The case is appropriate for use after any of the chapters in Section 1.

Ask students to read the case and get familiar with the data. Reinforce the explanation of the index values. Consider demonstrating the estimates in task 3 with a different brand or segment before the questions are assigned.

Students may be asked to prepare the questions in advance and then broken into small groups to discuss the Discussion and Debate questions, ultimately sharing their responses with the class.

Alternatively, students may work through the questions in class and complete the Discussion and Debate for homework. If you want to give students practice with data visualization, you can ask them to create an infographic to help them tell the data’s story in a way that supports their conclusions.

Questions and Sample Responses Task 1: Correct the Table The formulas are provided to help students complete the calculated values. Direct students to read the questions carefully to make sure they identify the correct numbers to plug into the formula.

Q1: Calculate the market segment size (in percentage) for heavy internet users Market Segment Size (000s) in the internet 1 (Heavy Users) Column = 50,839 /Market Segment Size (000s) in the Total Column = 254,237 50,839/254,237 = 20%

Q2: Calculate the percentage of total market for adults 18-34 who bought Adidas in the past 12 months.

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Appendix A

Estimated Count (000s in Adults 18-34) = 15,058 /Estimated Count (000s in Total) = 35,393 15,058/35,393 = 42.54% Students can check their work by making the calculations for the columns to the left and right and seeing how the answers compare to the values listed in those columns (which are not missing).

Q3: Calculate the index for adults 18-34 who are heavy internet users who bought Adidas in the last 12 months.

Calculation = 100 + [(% within market segment who bought last year in adults 18-34 heavy internet) 20.46 - (% within market segment who bought last year in total)]

13.92

/% within market segment who bought last year in total

13.92

x 100 The index is 147.

Q4: For the Women column, calculate the percentage within market segment who bought Asics in the last 12 months.

Estimated Count (000s)

7,162

/Market Segment Size (000s)

131,318

5.45%

Q5: For Men 18-34, calculate the Estimated Count (000s) who bought Nike shoes in the last 12 months.

Market Segment Size (000s) for Men 18-34 x

37,586

Percentage within Market Segment who bought Last Year for Men 18-34

0.2898

10,891

Task 2: Making Inferences about Athletic Shoe Buyers

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Appendix A

1. Generally speaking, does it appear that heavy internet users are more or less likely than the average U.S. adult to have bought these shoe brands in the last 12 months?

The response should consider each shoe brand. Based on the index of 124, it appears that heavy internet users are more likely than the average consumer to have bought Nike in the last 12 months. An index value of 124 can be interpreted as members of that segment are 24 percent more likely than the national average to have bought these shoe brands in the last 12 months. Similarly, Adidas (index = 120) and Reebok (index = 113) were more likely to be purchased by heavy internet users. On the other hand, heavy internet users were 9 and 16% less likely to buy Asics (index = 91) and New Balance (index = 84).

AACSB: Analytical 2. If you were going to run a series of advertisements for your company targeting younger adult women, which brand would you recommend to feature on the advertisement? Which shoe brand would you be disinclined to feature? Why? Most students will select Adidas to feature, as 23.04% of women 18-34 purchased Adidas in the last year according to the data. Similarly, 20.60% of women 18-34 purchased Nike and 19.36% purchased Reebok. On the other hand, New Balance only earned sales from 9.43% of women between the ages of 18-34 during the twelve-month period. Therefore, there is justification to not feature New Balance.

AACSB: Analytical, Reflective Thinking 3. Lately, management for your company has worried that its positioning has completely overlooked serving the wants of “older” consumers (older than 45 years old). If your company decides to market toward older U.S. adults, which of the brands should it be more conscientious about featuring?

The information in the table includes the total market, then breaks it out by men and women.

It provides additional information about a subset of the population, adults 18-34, and then breaks out the subset into men and women. It does the same with the heavy internet users – and then breaks out the heavy internet users who are 18-34 years old.

The information about the segments that include older consumers are not offered.

Fortunately, by comparing the 18-34 year olds to the values for men and women over 35, we can identify trends in the market that reflect consumers who are 35 and over. These trends can inform recommendations about brands to use to appeal to older consumers. Alternatively, students may choose to compare 18-34 year olds to all men and women.

For example, Nike and Adidas, which have a higher likelihood of being selected by 18-34 year olds than average Americans, have a lower likelihood of being selected by 35+ adults.

On the other hand, New Balance performs well with 35+ adults. Therefore, the company would want to be conscientious about featuring this brand to target older consumers.

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Appendix A

AACSB: Analytical, Reflective Thinking Task 3: Estimating the Value of the Shoe Buying Segments 1.

What are the total estimated sales of these five shoe brands for heavy internet users in the last 12 months?

The average number of pairs of shoes for each purchaser was 1.5 for Nike and Reebok, and 2.0 for Adidas, Asics, and New Balance. The average price per pair, as reported from internal financials, was $70 for Adidas, Asics, and New Balance, $65 for Reebok, and $75 for Nike.

Of the 50,839,000 heavy internet users, 8,490,000 purchased Adidas; 2,276,000 purchased Asics, 4,552,000 purchased New Balance; 13,025,000 purchased Nike; and 2,054,000 purchased Reebok.

Estimating the 8,490,000 heavy internet users who purchased Adidas in the last twelve months bought 2 pairs each at an average purchase price of $70: 8,490,000 x $140 = $1,188,600,000.

Estimating the 2,276,000 heavy internet users who purchased Asics in the last twelve months bought 2 pairs at an average purchase price of $70: 2,276,000 x $140 = $318,640,000.

Estimating the 4,552,000 heavy internet users who purchased New Balance in the last twelve months bought 2 pairs at an average purchase price of $70: 4,552,000 x $140 = $637,280,000.

Estimating the 13,025,000 heavy internet users who purchased Nike in the last twelve months bought an average of 1.5 pairs at an average purchase price of $75: 13,025,000 x $112.5 = $1,465,312,500.

Estimating the 2,054,000 heavy internet users who purchased Reebok in the last twelve months bought an average of 1.5 pairs at an average purchase price of $65: 2,054,000 x $97.50 = $200,265,000.

The estimate for all heavy internet users is calculated by adding the values for each brand together for a sum of $3,810,097,500 in athletic shoe sales to heavy internet users from the five brands in the last twelve months.

AACSB: Analytical 2. For a random U.S. adult woman, how much would we estimate she spent on Asics shoes in the last 12 months?

For a random U.S. adult woman, there is only a 5.45% chance that she purchased Asics shoes in the past twelve months. This can be calculated by taking the size of the current female market purchasing Asics (7,162,000) divided by the total size of the female athletic shoe market (131,318,000). If she purchased Asics athletic shoes, we estimate that she spent $140 on two pairs of shoes. Since there is only a 5.45% chance she falls into that segment, we estimate that a random U.S. adult woman spent $7.63 on Asics shoes in the last twelve months. This can be calculated by taking the average spend on shoes ($70 x 2 pairs = $140) .

Appendix A

and multiplying it by the likelihood of her purchasing athletic shoes (5.45%) ($140 x 5.45% = $7.63).

AACSB: Analytical 3. For the U.S. adult women segment, which shoe brand is currently the most profitable for the online athletic store? If it costs $10 in advertising spend to acquire a new female customer, which shoe brands would be best to feature in an advertising campaign?

For a random U.S. adult woman, there is a 14.4% chance that she purchased Adidas, a 20.63% change she purchased Nike, a 10.42% chance she purchased New Balance, and a 3.48% chance she purchased Reebok. Based on these calculations and the estimated spending calculated from Table 2, the average spend per brand is $20.16 for Adidas, $7.63 for Asics, $23.21 for Nike, $14.59 for New Balance, and $3.39 for Reebok. Nike and Adidas are currently the most profitable brands in the U.S. adult women segment. If advertising is being considered, Nike, Adidas, and New Balance would be the most appropriate brands to feature in an ad directed at the female market for the online athletic store.

AACSB: Analytical Discussion and Debate 1.

Based solely on the information that you analyzed, do you think it makes more sense for your company to: treat the whole market as homogeneous (no segmentation), use a single variable segmentation scheme (just gender, just age, just Internet usage), or a multivariate segmentation scheme? Regardless of your answer, identify the advantages and limitations associated with your argument.

Students may have different responses to the question. The important part of the response is that they support their conclusion with the data. The analysis of the information should lead them to the conclusion that there are benefits to segmenting the market using gender, age, and internet usage. For gender, male consumers were slightly more likely to buy New Balance and Reebok, and less likely to buy Asics and Adidas, where Nike was closer to average for both genders. If you add age to gender, you see clear differences between older and younger consumers, particularly when it comes to Nike, Adidas (favored by younger women), and New Balance (favored by older consumers) athletic shoes. Segmenting heavy internet users by age also suggests heterogeneity between younger and older heavy internet users when it comes to athletic footwear purchases in the last twelve months. Adidas and Nike are favored by younger heavy Internet users, with indices that suggest they are nearly 50% more likely to buy than the average U.S. consumer, while older heavy internet users have stronger preference for New Balance than younger heavy internet users.

AACSB: Analytical, Reflective Thinking 2. You are about to ask a junior analyst at your company to run another MRI Simmons report for you. Which additional variables do you think would be best to add into the report for segmentation purposes? Why?

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Appendix A

Student responses will vary. Some may note that they would prefer to have information about the segment that is 45 and older. Social class and income may be another relevant segmentation variable. Others might wish to see the information about heavy internet users broken out by age and gender. Students may wish to identify shoppers who access the online shoe retailer by mobile device and explore differences between those consumers and consumers who shop from a computer. Additional variables of interest may include geography and lifestyle characteristics, as well as product-oriented characteristics, where the benefits sought and prices paid by consumers who purchase athletic shoes for running may be different from the benefits sought and prices paid by consumers who purchase athletic shoes for basketball. Fashion consumers would be another segment that is likely to have different behavior, relative to consumers who purchase athletic footwear for athletic activities. Finally, there is an emerging trend of collecting and trading sneakers as a hobby, representing an additional consumer segment.

Additional information about media habits including social media platform use of each segment would be useful to better understand how to advertise the online athletic shoe store.

AACSB: Analytical, Reflective Thinking 3. Consider some of the emerging macro-environmental trends that influence consumer behavior. How could the athletic shoe store incorporate emerging trends into its marketing strategy?

Student responses will vary. Some may discuss the desire for authenticity and personalization, allowing customers to design their own shoe or personalize their purchase by swapping out the color of shoelaces or adding 3D printed design elements to their shoe. For example, Nike now has a “Nike by You” site where customers can design various elements of their shoe purchase. Students could also discuss the blurring of gender roles and how that may impact the current website layout or search structure for athletic footwear. Currently, the website may be segmented by gender, but this may be less important for consumers, allowing for the online retailer to create unisex search features.

AACSB: Analytical, Reflective Thinking

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Appendix A

Section 2: Evolving Trends in Fitness and French Fries Brief Description of the Data The data includes information about U.S. adult gym memberships in 2020 and 2022, as well as information about U.S. adult spending on fast-food restaurants, from the Spring 2020 and the Spring 2022 MRI Simmons. The data set also includes media preferences of fitness consumers.

Suggestions for Presentation Students may want to compare the 2020 and 2022 numbers for each variable before they start to answer the questions.

You may ask them to talk in small groups about what they observe and what they are able to infer from their observations in class and then assign the questions for homework.

A follow up in class activity may be to have them work in small groups to identify a target audience, identify the value proposition, and write a positioning statement for the friend’s gym.

Ask them to support their choices using their research and analysis of the competitors.

The emphasis in the questions and data is on the gym memberships. A follow up exercise might ask students to compare the positioning and persuasive messaging for one of the gym chains to the positioning and persuasive messaging one of the fast food restaurant chains. Ask them to make inferences about the target audiences and compare and contrast the value propositions associated with each.

Questions and Sample Responses Which of the three income groups had the largest change in gym membership from 2020 to 2022? If this was expressed in terms of percentage change, which income group experienced the largest change from 2020 to 2022? What do you think accounts for this change?

Gym memberships fell in every income category between the period of 2020 and 2022.

Consumers with household incomes of $75,000+ had a decrease of 8,400,000 memberships, or a 20.29 percentage point decrease. The middle income category (household incomes of $40,000$74,999) experienced the largest percentage point decrease with 22.67 percent fewer consumers with gym memberships.

AACSB: Analytical

Which of the three gyms had the largest market share in 2020? In 2022?

Planet Fitness was the market share leader in 2020, with 12,000,000 members, and remained the leader in 2022 with 10,100,000 members, despite the decline in memberships.

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Appendix A

AACSB: Analytical

From 2020 to 2022, does it appear that LA Fitness, 24 Hour Fitness, and Planet Fitness comprise a greater or lesser share of the total gym membership market? Why? Despite membership decline, Planet Fitness increased their share of the market, moving from 17.7% market share to 18.9%. Planet Fitness had the slowest decline rate, with a 15.8% decline, losing 1.9 million memberships in the two year period. On the other hand, 24 Hour Fitness experienced a more severe decline, losing 31.6% of its customers in a 2 year period and nearly a full percentage point in market share loss between 2020 and 2022 (from 5.6% to 4.9%). The decline in memberships experienced by 24 Hour Fitness far exceeded the average industry loss of 21.4%.

AACSB: Analytical

Discussion Compare the membership trends between LA Fitness, 24 Hour Fitness, and Planet Fitness. Are membership trends similar or different across genders and income groups? Consider the different marketing mixes of the three gyms; what do you think may account for the differences in membership trends? (Tip: You can use a tool like Google News to search for news articles about each gym in 2020 or 2022.)

Despite membership decline, Planet Fitness experienced an increase in market share amongst both male and female segments. While Planet Fitness retained its dominant market share, its membership declines were highest among the female segment, losing one million female memberships.

LA Fitness and 24 Hour Fitness lost market share amongst women (with a decline of 8.5% to 7.6% for LA Fitness and a decline of 6.5% to 5.1% for 24 Hour Fitness), but experienced a more modest decline (LA; 0.1% decline) or no decline (24) amongst men.

24 Hour Fitness experienced no change in memberships amongst households with incomes between $40,000 and $74,999, however, 24 Hour Fitness experienced a loss in memberships across the other income segments and from both genders. These changes represent a decrease in market share for the lower income and upper income segments, however, the stable memberships amongst the middle-income category represents an increase in market share (from 4.7% to 6% of this income segment) given the overall industry declines. 24 Hour Fitness maintained market share from the male segment (4.6%), but experienced a market share decline amongst women (from 6.5% to 5.1%).

Despite a decline in memberships, LA Fitness gained market share among members with household incomes less than $40,000 (with an increase from 7% to 7.6% market share from this segment) and amongst members with household incomes between $40,000 and $74,999 (with an

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Appendix A

increase from 6.7% to 7.8% in this income segment). LA Fitness lost market share among members with household incomes greater than $75,000 (with a decline from 8.5% to 7% of this income segment).

Planet Fitness gained market share amongst the middle- and upper-income segments with increases from 19.3% to 20.7% amongst members with household incomes between $40,000 and $74,999 and increases from 15.2% to 17% amongst members with household incomes greater than $75,000. Planet Fitness experienced market share decreases amongst the lower income segment.

AACSB: Analytical, Reflective Thinking

Your friend told you that he envisions his gym being a place where people who are “intimidated” about going to the gym will feel safe and empowered to work out. Assuming this aspect of your friend’s gym is going to be part of his positioning, which of the three competing gyms would you consider to be his most serious competitor? Why? The Planet Fitness franchise used Judgement Free Zone messaging to avoid “gymtimidation,” which is similar to the messaging your friend envisions using at his gym.

AACSB: Analytical, Reflective Thinking

Which income group has experienced the greatest increase in fast food spending from 2020 to 2022? Do you think this information is relevant for your friend when thinking about the marketing mix of his gym? Why or why not?

Households with incomes over $75,000 experienced an increase in fast food spending, which may signal something about the value of convenience among higher income consumers. It could also be a signal that this income segment was better able to absorb inflationary increases. Fast food sales increased between 2020 and 2022, which could be a function of increased price points on the fast food menus due to inflation. While fewer consumers earning less than $40,000 annually purchased fast food in the last six months, consumers in this segment spending more than $100 on fast food increased by 168%. A discussion of macro-level social and economic trends and their corresponding impacts on consumer behavior relating to the pandemic and inflation may be useful.

A 2017 Wall Street Journal article mentioned a trend where gyms are increasingly offering healthy meals (preservative free, natural) to go at gyms. The popular service may have high margins, which could influence your friend’s marketing mix.

A 2022 article from Market Watch positions Planet Fitness as “more affordable” under an inflationary climate. Another interesting trend reflected in this article and others includes a discussion of gym amenities such as swimming pools and daycare. LA Fitness is more known for

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Appendix A

such amenities, having remodeled many of its facilities pre-pandemic to include pools, spas, cycling studios, and playing courts.

While not detailed in the included data tables, Planet Fitness offers a High School Summer Pass as a market strategy to attract a younger market segment.

AACSB: Analytical, Reflective Thinking Visit the websites of LA Fitness, 24 Hour Fitness, and Planet Fitness. Compare and contrast the perceptual elements used by these three brands. How might your friend develop a positioning strategy that learns from the success of these brands and differentiate his gym using sensory stimuli and perceptual positioning?

Student responses will vary. One point of comparison could be based on visual perception.

Planet Fitness and 24 Hour Fitness both have gym members moving and using equipment in a video format displayed on their front pages. For 24 Hour Fitness, this focuses more on their class environments. For Plant Fitness, the focus is more on individual workouts and use of equipment. In contrast, LA Fitness uses static pictures on rotation. Other points of visual perception include contrasting color schemes, logo choices, fonts AACSB: Analytical, Reflective Thinking Suggest how your friend might apply concepts from motivational theory to encourage consumers to join their gym.

Student responses will vary. One point of discussion may revolve around personal relevance and self-concept. Students may discuss how the promotional use of people who look like the target audience, taking a normative approach, versus using fitness models, taking an aspirational approach. Another discussion point could revolve around goals and how gym slogans align with various fitness goals. For Planet Fitness, the slogan “feel fitacular” and “judgment free” focus on the value proposition of exercise to feel better in a welcoming environment rather than focusing on weight loss. In contrast, 24 Hour Fitness focuses on the value proposition through benefit naming and through their slogan “for your best results” to focus on weight loss or strength outcomes.

AACSB: Analytical, Reflective Thinking Based on the available data, create a buyer persona for your friend’s ideal customer.

The data indicates that the largest income segment for gym memberships is in households with income over $75,000 per year. For gender, women represent the gender segment that is most likely to have a gym membership. The household income of the $75,000+ segment is also the most likely to have spent over $100 in fast food expenditures. This may indicate that this income segment has higher disposable income to pay for a gym membership and could also be communicating the value of convenience (for fast food). Women are slightly less likely to have spent more than $100 on fast food and therefore may be less interested in some of the curious trends your friend mentioned. Students should showcase some creativity in creating a semi-fictional character description around these three insights. Other points that may be relevant to the persona, but are not present in the data include age, fitness goals, and preferences (i.e., feeling safe and empowered). .

Appendix A

AACSB: Analytical, Reflective Thinking

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Appendix A

Section 3: Cats, Kibble, and Commercials Brief Description of the Data Three reports from MRI Simmons are provided to inform a media buy for a pet boutique chain.

The reports include quantity of pets owned by viewers of each channel, the types of pet services used by channel viewers, and where people buy their pet food.

Suggestions for Presentation Before students respond to the questions, which are broken out into separate tasks, consider asking them to identify examples of vertical percentage information and horizontal percentage information and explain what it means. The index values are provided. Consider reviewing that an index of 100 is average for U.S. consumers.

The case is appropriate for use after any of the chapters in Section 3, which examines how consumers make decisions about products. It may be helpful to review consumer segmentation and note its practical application in the context of media buying.

The problems can be assigned for homework or worked as small groups in class. The questions can help inform the discussion and debate, so an assignment that gives students the opportunity to respond to the questions individually and submit them, as homework, and then asks them to work in small groups to respond to the debate and discussion questions, it may increase their analysis of the results and provide them with an opportunity to consider alternative perspectives.

If you wanted to add to the assignment, consider asking students to look up the media kits for the networks and creating a storyboard for the creative they would recommend appear on one of the networks, based on the metrics and what they learn from the media kit.

Questions and Sample Responses 1. If someone owns a dog, what is the percentage chance they watch Fox News? What if they own a cat?

Students should identify the 1 dog segment and look for the vertical percentage, 18.4%, which represents the percentage of 1 dog owners who watch Fox News. For 1 cat owners, the vertical percentage is 16%.

AACSB: Analytical 2. Which channel is much more likely to be watched by someone with four or more dogs than an average American? What is the index value for this channel? An index value of 100 is the benchmark for an average U.S. adult to have four or more dogs.

Animal Planet has an index among U.S. adults with four or more dogs. It is watched by 16.1% of viewers with four or more dogs. The Discovery Channel has an index of 150. It is watched by

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Appendix A

23.5% of viewers with four or more dogs. The History Channel is more popular with U.S. adults, in general, so although its index is 127, it reaches 24.3% of dog owners with 4 or more dogs.

Similarly, the Food Network is more popular among U.S. adults, so although it has an index of 111, it attracts 21.5% of viewers with four or more dogs.

AACSB: Analytical 3. Which channel is much less likely to be watched by someone with four or more cats than compared to an average American? What is the index value?

The Cooking Channel has an index value of 82 for people who have four or more cats. It is much less likely to be watched by someone with four or more cats than an average American.

AACSB: Analytical 4. If we wanted to reach the two to three dog-owning households by advertising on a single cable channel, which channel would we pick?

HGTV is watched by 21.6% of dog owners with two to three dogs. Similarly, the History Channel is watched by 21.4% and the Food Network is watched by 20.7% of dog owners with two to three dogs.

AACSB: Analytical 5. Based on these results, is it fair to say that Animal Planet watchers are more likely to own either a cat or dog compared to the national average?

Animal Planet watchers are more likely to have at least one dog or cat than the national average.

Of all Animal Planet watchers, 83.8% of them have at least one pet.

AACSB: Analytical 6. Regardless of the number of dogs or cats someone owns (including zero!), about how many U.S. adults in total said they watch the Cooking Channel?

Fifteen million, 465 thousand adults said they watch the Cooking Channel. The students can calculate it by taking the viewers within a segment divided by the percent of horizontal to get the total viewers.

AACSB: Analytical 1. Your friend assumed that Animal Planet is the best channel to find pet owners who use pet services frequently. Do your data support or contradict her belief? Why?

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Appendix A

The data suggest History Channel attracts consumers who use pet services frequently. Less than 12% of most pet service users watch Animal Planet. On the other hand, History Channel attracts 17-21% of pet service users and HGTV attracts 20-24% of pet service users.

AACSB: Analytical

1. Assuming people only buy from one of the four options, how many people in total bought their pet food from an online pet store, grocery store, a pet specialty store, or directly from their veterinarian? What percentage of this total bought from their veterinarian?

Table 3 shows 9.1% of the U.S. market buys pet food at online pet stores, 23.1% of the market buys pet food at a grocery store, 3.5% of the market buys pet food from the veterinarian, and 4.8% of the market buys at pet specialty stores. Of those who bought pet food from one of those four options, 9.8% bought from the veterinarian.

AACSB: Analytical

2. Which cable channel had the largest percentage of viewers who buy their pet food from a veterinarian?

HGTV has the greatest number of viewers who buy their pet food from a veterinarian (22%).

AACSB: Analytical Discussion and Debate 1. Based only on the information provided, which three cable channels would you recommend as the best choices for promoting the business? Which three cable channels do you think are the poorest fit?

HGTV, the History Channel, and the Food Network have a high percentage of consumers who purchase pet food at specialty stores or the veterinarian. Consumers in these categories might be more likely to switch to another specialty store. Fox News, AMC, and the Discovery Channel are also relevant options. History Channel viewers are also active users of pet services, which may be higher margin offerings at a pet boutique. On the other hand, Comedy Central, the Cooking Channel, and SyFy do not attract a large percentage of pet owners, so they would likely be the poorest fit.

AACSB: Reflective Thinking 2. What other additional information would you like to have so that you could make a more informed recommendation? Why is it important? How could you find out this information?

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Appendix A

Information about income, household size, discretionary spending on pet products, and geography might help the boutique pet stores decide where to locate and who to target. With the competition from online, receiving high touch, in person services may be more desirable if they are easy to access. In addition, if the audience is outside the perimeter that would travel to a location, it is wasted coverage. Income is important if the boutique prices are higher, but perhaps more important is the discretionary spending on pet products. Sometimes consumers spend disproportionately on pets if they are perceived as family members. Additional fields could be requested on the report. Sales information from current customers could be analyzed to understand how far they are willing to travel and what different types of pet owners spend.

AACSB: Analytical 3. If the pet store chain told you that its services were much more profitable than its product (toys, food, and so on) sales, would that change your recommendation? Why or why not?

Student responses may vary, and it is a nice opportunity for them to reconsider if they just focused on the number of pets or dog food. However, the numbers related to pet service consumption are largely consistent with the pet food offerings. The services were factored into the sample response. Comedy Central and Syfy do a little bit better with services than the Cooking Channel, but they still reach less people in the target audience. So, in this example, the recommendation would not change.

AACSB: Analytical, Reflective Thinking

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Appendix A

Section 4: Going Global with Juice Brief Description of the Data The 2014 GfK Consumer Trends Global Consumer Survey and the 2018 CIA Factbook provided the information in the table, which includes information about countries (Germany, UK, and USA), High and Medium income groups, White and Blue collar occupational groups, and then values and behavior. The behaviors of most interest are related to fruit juice consumption.

Suggestions for Presentation The analysis of the data for the first task, Understanding the Data, is straightforward and would be quick to go over in class in advance of assigning tasks two and three. One possibility would be to introduce the data and work through task one together, assign tasks 2 and 3 for homework, and then have the students work in small groups to compare their responses and engage in the discussion and debate.

If you choose to do tasks two and three in class, it would be helpful for students to have the data in an Excel file.

Some of the calculations are provided for the high income, white collar segment from Germany.

Students may use this information to double check their work as they calculate values in other segments.

If you wanted to add to the existing assignment, you can ask the students to explore other information that is available about the countries in the CIA Factbook that might have an influence on the results. In addition, you may ask students to gather their own data about which countries might have high potential for expansion, given their inferences about the countries in the data set, as an individual or group assignment.

Questions and Sample Responses Task 1: Understanding the Data (AACSB: Analytic) 1. Which country has the segment with the fewest consumers in it?

The answer is Germany. The High Income, Blue Collar segment has about 51,640 people who drink fruit drinks daily. The Medium Income, Blue Collar segment is also small, but although it has the smallest percentage, the group it is a percentage of is larger, which makes the number of consumers larger.

2. Which country has the largest total number of potential consumers in it?

The United States has the highest total number of potential consumers in it, with 265.45 million consumers.

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Appendix A

3. Find the country that has the consumer segment that makes up the largest percentage of its total amount of consumers. What is that percentage?

The USA White Collar workers with high incomes account for 77.2% of the largest group size, which is about 58% of all US consumers who are 15+.

4. Which segment prioritizes physical appearance as a motivation for eating/drinking healthy?

The USA White Collar workers with high incomes prioritize eating healthy, nutritious foods for appearance.

5. Which segment prioritizes mental/emotional health as a motivation for eating/drinking healthy?

High income, Blue Collar workers from the UK prioritize mental/emotional health as a motivation for eating/drinking healthy.

Task 2: Estimating Sales (AACSB: Analytic) Using some assumptions provided by the CFO, you are tasked with estimating the annual sales (in $) for each segment in each country. To do so, you will need to make the following assumptions: • When someone says they drink juice or drinks fruit drinks “daily,” we assume they actually have 0.7 of that drink on a typical day.

• When someone says they drink juice of drinks fruit drinks “weekly,” we assume they actually have 0.1 of that drink on a typical day.

• For all other answers, we assume that they don’t drink the beverage at all.

• There are 365 days in a year.

• Using the data provided by GfK and the assumptions above, what are total estimated number of fruit drinks & juices (combined) that are estimated to be sold to consumers of each segment in a typical year (365 days)?

The answers have been provided to you for the first column.

CALCULATION: Estimated Units Sold Per Segment per Year = [(Segment Total Size) × (% daily drink) × (assumed daily consumption) + (Segment Total Size) × (% weekly drink) × (assumed daily consumption) + (Segment Total Size) × (% daily drink)*(assumed daily consumption) + (Segment Total Size) × (% weekly drink)*(assumed daily consumption)] × 365 According to these estimates, how many beverages would we assume a typical person in each segment consumes per year?

CALCULATION: Average yearly consumption per consumer = [For each segment, take the answers immediately above]/[total size of segment] Task 3: Estimating Sales Financial Assumptions: .

Appendix A

(1) The per unit price sold to distributors will be $0.80, regardless of country or quantity sold.

(2) The estimated market share for sales depends on how much a segment sees health and wellness as being essential to their lives. If healthy and wellness is a priority for a segment, the CFO assumes a 10% market share in that segment during the first year is reasonable. If health and wellness is not a major priority, the market share is assumed to only be 5%. Health and wellness is considered to not be a priority for a segment if less than 50% of the members of that segment identify it as a priority.

Question 1: Using the GfK data and the information provided by the CFO, what is the estimated annual sales for each segment?

CALCULATION: Annual Sales $ estimated per segment = [(Original Estimated Units Sold Per Segment per Year) × (Assumed Market Share, per CFO’s rules) × (Price per unit to distributors)] Germany High

Number of Daily Drinks in Segment (000s) Beverages sold per year to segment (000s) Estimated annual juice/drink beverages consumed per year by segment member CFO Data Estimated Market Share within segment Estimated Annual Sales Estimated Sales per Consumer

Medium White Collar Blue Collar White Collar Blue Collar 544.5 317.4 2155.8 1147.6 198732.6

115842.1

786867.4

418868.6

72.5

78.5

69.1

51.0

19873.3

11584.2

78686.7

41886.9

15898.6 5.8

9267.4 6.3

62949.4 5.5

33509.5 4.1

UK High White Collar Number of Daily Drinks in Segment (000s) Beverages sold per year to segment (000s) Estimated annual juice/drink beverages consumed per year by segment member CFO Data Estimated Market Share within segment Estimated Annual Sales Estimated Sales per Consumer

Blue Collar

Medium White Collar Blue Collar

1609.0

752.6

1168.5

1315.4

587284.5

274681.1

426493.0

480127.2

111.5

126.5

84.5

95.1

29364.2 23491.4 4.5

27468.1 21974.5 10.1

21324.7 17059.7 3.4

24006.4 19205.1 3.8

USA High

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Medium

Appendix A White Collar Number of Daily Drinks in Segment (000s) Beverages sold per year to segment (000s) Estimated annual juice/drink beverages consumed per year by segment member CFO Data Estimated Market Share within segment Estimated Annual Sales Estimated Sales per Consumer

Blue Collar

White Collar

Blue Collar

6802.8

1799.3

5492.4

5263.6

2483027.9

656753.7

2004715.0

1921196.5

124.7

66.9

82.1

100.5

248302.8 198642.2 10.0

32837.7 26270.1 2.7

100235.8 80188.6 3.3

192119.7 153695.7 8.0

Please note that the market share is adjusted for UK High Income White Collar Consumers and UK Medium Income White Collar and Blue Collar Consumers as well as for High Income US Blue Collar workers and Medium Income US White Collar workers because they have less than 50% of the segment that values Health and Fitness. Therefore, their market share is 5% instead of 10%.

Question 2: Which country, overall, has the highest estimated annual sales? Which country has the lowest estimated annual sales?

The US has the highest estimated annual sales and the UK has the lowest estimated annual sales.

Question 3: Based on these estimates, how much money per consumer would we expect for each segment?

The last row in each table has the estimated sales per consumer.

Discussion and Debate: 1. Based solely on the information that was analyzed, which country do you think your juice company should expand to? Why? There appears to be greater demand for a premium, all natural juice beverage line in Germany than there does in the UK. The value associated with health and wellness, particularly among higher income consumers, should increase the likelihood of success in the German market.

2. While making its financial estimates, your company did not consider the impact of every GfK survey question reported in the table above. For example, the company did not consider if each segments’ satisfaction with the availability of healthy foods and beverages at grocery stores might impact their market share within a given segment. From your perspective, how

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Appendix A

might your firm incorporate the rest of the GfK information into their estimates? Which questions do you think may lead to you increasing or decreasing different estimates?

Student responses will vary. Consumers who have unmet needs for healthy options may be more attractive than consumers in a saturated market. Therefore, the satisfaction might factor into the strategic decision making. However, because the availability of healthy options often corresponds with market demand for healthy options, the fruit juice might have an opportunity to grow in a health and wellness oriented market if the market is not saturated.

The different motivations for eating health, nutritious foods – physical health, mental/emotional health, and appearance – might inform positioning and estimates of market demand.

3. Think about other important consumer behavior factors that might impact the success of your company's juice in a foreign market. What other important information do you think is pertinent for your juice company to know but was not present in the table above? Why? Student responses will vary. Availability of technology like refrigeration in homes and retailers would affect distribution and access. Factors like the size of the refrigerator and how often one shops might impact purchasing frequency. Perceptions of the US as the country of origin, and desire for local foods, might impact attitudes toward the product. Demand for alternatives – other ways of quenching thirst like water or nutrient enhanced beverages – might impact demand for juice.

AACSB: Analytical, Reflective Thinking

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