MAR 4333521

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MAR 4333-521

• Promotion Management
• Fall 2003Sarasota
• September 20, 2003
• Perspectives of Consumer Behavior
• Rich Gonzalez University of South Florida

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URLs (used today)

• www.smirnoff.com
• www.diageo.com
• www.pny.com

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September 20, 2003--Agenda

• Quiz 2
• Consumer Behavior
• For September 27

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For Today September 20

• Chapter 4- Perspectives on Consumer Behavior
• Diageo Effort to Revamp SmirnoffReflects
  'Superpremium' Successes,Deborah Ball, WSJ,
  September 5, 2003

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For September 27

• Chapter 5- The Communications Process
• RIAA Takes Off Gloves In Mounting Its Fight
  Against Music Thieves ,Lee Gomes, WSJ, September
  15, 2003

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Last Time

• National Assoc. RealtorsBenefits, Consistency
• Gateway--Inconsistency
• Examples of IMC In AdsNew BalanceFit
• Example of Broad ObjectiveFord
• Advertising Media Biz Structure

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Marketing Communication Requirements

• 1. Clearly Positioned
• 2. Directed to a Target Market
• 3. Created to Achieve Objective
• 4. Accomplishes Objective Within Budget Constraint

Shimp 2003
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Ford Brands

• Jaguar
• Ford
• Lincoln
• Mercury
• Mazda
• Volvo
• Aston-Martin

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Gateway

• 9/09/03--Gateway Inc. eliminating about 850
  jobs at the Sioux Falls, S.D., plant and an
  additional 100 workers will be laid off from
  North Sioux City, S.D. in Kansas City, Kan.
• In addition to those 850 will close its
  Hampton, Va., plant and lay off 450 save the
  company as much as 130 million a year
• cumulative losses of 1.73 billion since the
  fourth quarter of 2000.

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Diageo

• Biggest Vodka Brand?
• What Does James Bond Drink?
• 32 Market Share6.8 Million Cases (2002)Up 8
  in Volume2 Competitor Behind By 2 Million Cases
• Worldwide Market Leader Since 1970s

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Diageo Assignment

• Why is Smirnoff in trouble?
• What is Diageo doing about it?List some
  promotional activities
• Your opinion on efficacy
• Well open the class on 9/20 discussing this.

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Diageo--Smirnoff

• Smirnoff is in trouble because
• Share is down to 32 (-36)
• Superpremiums BIG Success
• Marketing Wasnt Effective Enough
• James Bond Dropped Them
• Relied On Older CustomersDidnt Get Younger
  Ones

Class Discussion
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Competitors?
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Diageo--Smirnoff

• Diageo is doing
• Parties with bartenders, salespeople, waitstaff
• Teaching specialty drinks
• Pitching Neat
• Changing Packaging
• New Commercials (J.Walter Thompson)
• Sponsoring Music Events
• Contest Forcing Participation/Consumption

Class Discussion
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Diageo--Smirnoff

• Diageo will (will not) be effective
• Courting bartenders is a smart move
• Changing Package Is Risky
• Diageo Knows They Need to Change Marketing
• If commercials use real people, will be
  effective
• Must innovate to offset the long term trend
  toward less per capita consump.

Class Discussion
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Quiz 2 Q1

• 1. The consumer decision process, consisting of
  several stages, begins with the problem
  recognition stage, then
• A) terminates if the interpersonal determinants
  do not last.
• B) continues on to search and evaluation of
  alternatives stages.
• C) frequently gets cut short due to consumer
  attitudes.
• D) the next stage is purchase.
• E) proceeds to the search stage, then immediately
  to purchase.

B Chap 4 105
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Quiz 2 Q2

• 2. Attitudes are learned predispositions to
  respond to an object. Consumer attitudes are
  important to marketers because they represent
  positive or negative feelings ________
• A) and desires.
• B) and discretionary income.
• C) and neutrality.
• D) which cannot be changed.
• E) and behavioral tendencies.  

E Chap 4 p 117
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Quiz 2 Q3

• 3. When consumers engage in information search,
  they often start with
• A) external search.
• B) sensation search.
• C) TV commercials.
• D) internal search.
• E) cognitive dissonance.

D Chap 4 p 112
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Quiz 2 Q4

• 4. A(n) _____________ is a group whose
  perspectives or values are being used by an
  individual as the basis for his or her judgments,
  opinions, and actions.
• A) decision team
• B) reference group
• C) purchasing agent
• D) lead example
• E) income group

B Ch 4 p 129
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Quiz 2 Q5

• 5. The various brands identified as purchase
  options to be considered
• during the alternative evaluation process is
  the consumers __________

Evoked Set Ch. 4, P116
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Brand Equity

• Awareness
• Loyalty
• Quality
• Associations

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Promotional Mix

• Advertising
• Direct Marketing
• Interactive/Internet Marketing
• Sales Promotion
• Public Relations
• Personal Selling

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Consumer Behavior

• The process and activities people engage in when
  searching for, selecting, purchasing, using,
  evaluating, and disposing of products and
  services so as to satisfy their needs and wants.

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It Would Be Logical

• Are consumers and buyers like Mr. Spock?

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The Consumer Decision Process
Problem Recognition
Information Search
Alternative Evaluation
Purchase Decision
Postpurchase Evaluation
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An Integrated Model of the Consumer Decision
Process

• Interpersonal Determinants
• Cultural Influences
• Social Influences
• Family Influences

Problem Recognition
Search
Feedback

• Personal Determinants
• Needs and Motives
• Perception
• Attitudes
• Learning
• Self-Concept

Alternative Evaluation
Purchase
Purchase Evaluation
Purchase Act
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Consumer Decision Process and Relevant Internal
Psychological Processes
Decision Process Stages
Psychological Processes
Problem Recognition
Motivation
Information Search
Perception
Alternative Evaluation
Attitude Formation
Purchase Decision
Integration
Postpurchase Evaluation
Learning
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Sources of Problem Recognition

• Out of stock
• Dissatisfaction
• New needs or wants
• Related product purchase
• Market-induced recognition
• New products

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Floppy Disk

• Benefits
• Costs
• Deficiencies

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New Product

• Flash Drive (Thumb Drive)
• www.pny.com

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Maslows Hierarchy of Needs
Physiological needs (hunger, thirst)
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Pampers appeals to needs for love and belonging
in this ad
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Las Vegas Convention Visitors Bureau

• View 4 Commercials
• What is the Objective?
• Good Taste or Bad Taste?

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Las Vegas Convention Visitors Bureau

• Objective(s)
• Go to Vegas
• Go to Vegas and be BAD
• Lose your inhibitions
• Message You wont pay for your actions

Class Discussion
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Las Vegas Convention Visitors Bureau

• Comments
• Might offend some people
• A little risque
• Inconsistent with family positioning
• No mention of gambling
• YOUR mental image of what it is that stays here

Class Discussion
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Probing the Minds of ConsumersPsychoanalytic
Theory Motivation Research

• In-Depth Interviews
• The consumer talks freely in an unstructured
  interview to obtain insights into his or her
  motives, ideas or opinions.
• Projective Techniques
• Methods allowing consumers to project values,
  motives, attitudes or needs on some external
  object.
• Association Tests
• Consumers respond with the first thing that comes
  to mind when presented with some verbal or
  pictorial stimulus.
• Focus Groups
• A group of consumers with similar backgrounds or
  interests discuss a product, idea or issue.

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Information Search

• Internal Search information stored in memory
• External Search actively seeking information
• from various sources
• Personal sources
• Friends, relatives, co-workers
• Market-controlled sources
• Ads, salespeople, in-store displays
• Public sources
• Print articles, news reports
• Personal experience
• Handling, examining, testing, using

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Perception
The process by which an individual receives,
selects, organizes and interprets information

• Stages in the perception process
• Sensation
• Attending to information
• Interpreting information
• Responding to information

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The Selective Perception Process
Selective Exposure
Selective Attention
Selective Comprehension
Selective Retention
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Evaluation of Alternatives
Brand B
Brand E
Brand I
Brand F
Brand M
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Toothpaste

• Crest
• Colgate

• Aim
• Pepsodent
• Mentadent
• Close-Up
• Aquafresh
• Rembrandt
• Sensodyne
• Arm Hammer
• UltraBrite

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Evaluative Criteria

• Criteria - Dimensions or attributes of a product
  or service used to compare various alternatives
• Objective criteria - price, warranty, color, size
• Subjective criteria - style, appearance, image

• Consequences outcomes that result from using a
  product or service
• Functional consequences concrete and tangible
• Pyschosocial consequences abstract, intangible

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This ad focuses on the favorable consequences of
using Top Flite golf balls
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Consumer Attitudes

• Learned predispositions to respond toward an
  objectan individuals overall feelings toward or
  evaluation of an object.

• Consumers may hold attitudes toward
• Individuals
• Brands
• Companies
• Organizations
• Product categories
• Retailers
• Advertisements
• Media

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Multiattribute Attitude Model

• Attitudes are a function of
• A S Bi X Ei
• A Attitude
• Bi Beliefs about brands performance on
  attribute i
• Ei Importance attached to attribute i
• N Number of salient attributes considered by
  consumer

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Ways to Influence or Change Attitudes

• Increase or change the strength or belief rating
  of a brand on an important attribute
• Change consumers perceptions of the importance
  or value of an attribute
• Add a new attribute to the attitude formation
  process
• Change perceptions of belief ratings for a
  competing brand

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Integration Processes and Decision Rules
Integration processes are the way product
knowledge, meaning, and beliefs are combined to
evaluate alternatives

• Types of decision rules
• Heuristics simple rule of thumb rules that are
  easy to use and apply
• Buy least expensive brand
• Buy brand on sale or for which I have a coupon
• Affect referral rule make decision on basis of
  overall affective impression or feelings about
  the brand
• Compensatory rules evaluate the strengths and
  weaknesses of each brand

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Market leaders such as Budweiser appeal to
consumer affect in their advertising
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St. Elizabeth Health Center

• Objective Increase PreferenceReach Consumer On
  Emotional Level
• View 2 Commercials
• 1. Heart Surgery--Rational
• 2. Traumatic PotentialEmotional

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St. Elizabeth Health Center

• Consistent?
• Contrast?
• Effective?

Class Discussion
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Consumer Learning Processes

• Cognitive Learning
• Consumers learn through information processing
  and problem solving
• Behavioral Learning
• Learning via association (classical conditioning)
• Learning via reinforcement (instrumental cond.)
• Modeling Processes
• Based on observation of outcomes and consequences
  experienced by others

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Cognitive Learning Process
Goal
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Classical Conditioning Process
Unconditioned stimulus (waterfall)
Association develops through contiguity and
repetition
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This Brita ad uses classical conditioning
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Instrumental Conditioning Process
Behavior (consumer uses product or service)
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External Influences
Subculture
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The Hispanic subculture is a very important
market in many parts of the U.S.
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Variations in ConsumerDecision Making

• Types of Decision Processes
• Extended Problem Solving
• Limited Problem Solving
• Routine Response Behavior

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Cholesterol-Free Half Half

• Objective Introduce New Product
• View 2 Commercials
• 1. Rational Appeal
• 2. Emotional Appeal

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Cholesterol-Free Half Half

• Do customers consider cholesterol content in food
  product purchase decisions?
• Effective?

Class Discussion
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End