Psychology and Consumer Behavior

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Psychology and Consumer Behavior

• Frank R. Kardes

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No Call List

• What do you think???????

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Ad Exposure

• North Americans
• TV, Radio, Newspaper, Magazines
• This estimate does not include

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Consumer Psychologists Questions

• How do consumers
• What influences
• What kinds of errors
• What are the best

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Consumer Psych Studies
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History of Consumer Psychology

• John B. Watson
• Following WWI
• Controlling and predicting behavior

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Watson
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Consumer Psychology Today

• Consumer psychologists study
• The thinking behind consumer decisions

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Heuristics

• Mental shortcuts which allow consumers
• They can be helpful and harmful
• 4 common heuristics

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Prediction Heuristics

• 1. Representativeness Heuristic
• Medicine
• Can be incorrect

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Prediction Heuristic

• 2. Availability Heuristic
• Lots of overestimations and underestimations come
  from this because relying on event frequency in
  memory

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Prediction Heuristic

• 3. Simulation Heuristic
• What is hard for you to imagine seems implausible

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Prediction Heuristic

• 4. Anchoring and Adjustment Heuristic
• Since anchoring is easy and adjustment is hard we
  find it difficult to change first impressions of
  people

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Product A and B

• Examples

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Persuasion Heuristic

• 1.
• Assumes that long messages filled with lots of
  facts and figures indicate that the advertised
  product is of higher quality than those of
  shorter lengths regardless what they say

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Persuasion Heuristic

• 2.
• Based on the idea that people generally agree
  with people they like
• Example

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Persuasion Heuristic

• 3.
• Suggests the majority opinion is usually
  considered to be valid
• Example
• Example

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Compliance Heuristics

• Commitment and Consistency Heuristic
• Shows that once people agree (commit) to a
  request, they tend to stick to the agreement (be
  consistent) even if the nature of the request
  changes

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Examples of Commitment and Consistency Heuristic

• Low ball strategy
• Example
• Foot in the door
• Example

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Compliance Heuristic

• 2. Reciprocity Heuristic
• Example

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Example of Reciprocity Heuristic

• Ask you to buy something really expensive and
  you refuse but now are more likely to buy smaller
  product which was actually the target

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Compliance Heuristic

• 3. Scarcity Heuristic
• Example
• Example
• Example

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Compliance Heuristic

• 4. Social validation heuristic
• Consensus applies correctness
• Many others have bought it so you should too
• Examples
• Example

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Compliance Heuristic

• 5. Linking Heuristic

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Compliance Heuristic

• 6. Authority Heuristic
• Example

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Choice Heuristics

• 1. Lexicographic Heuristic
• Example

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Choice Heuristic

• 2.
• Helps us to make choices efficiently by
  eliminating all options that do not have the
  desired attributes and then examine all remaining
  attributes for the next most important and
  continuous until only one product is left

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Choice Heuristic

• 3. Additive Difference Heuristic
• We pay attention
• Most thorough

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Choice Heuristic

• 4. Conjunctive and Disjunctive Heuristic
• Conjunctive
• Disjunctive

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Effects of Context on Consumer Choices

• The background against which consumers view the
  product they buy is important
• Product should be
• Surround the product

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Effects of Context on Consumer Choices

• If we remember the background that went with a
  product
• Music, Scenery, Characters
• The more overlap between cues present in
  advertising

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Effects of Context on Consumer Choices

• We are more likely to remember what we think
  about most often or what we have just learned
  recently
• Context
• Example

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Effects of Context on Consumer Choices

• Consumers tend to give too much weight to
  information they have and too little weight to
  what information they dont have
• Example

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Effects of Context on Consumer Choices

• Expectations
• Winning 100 dollars is good
• Winning 100 dollars is not good

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Psychological Models of Consumer Behavior

• The Availability Valence Model
• Suggests that consumers evaluate products based
  on 2 key factors
• The more a consumer thinks about a product the
  more available it will be later

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Examples of the Availability Valence Model

• Sleeper Effect
• Overjustification Effect
• Example

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Summary of this Model

• Marketers should attempt to alter consumers
  memories so that more favorable than unfavorable
  information is available about a product

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The Accessibility Diagnosticity Model

• Builds
• Adds a third factor
• States that not only is availability and valence
  important

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The Accessibility Diagnosticity Model

• This model helps us figure out (based on what is
  relevant to the consumer at the time of purchase)
  what consumers will use as a basis for their
  purchase decisions

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The Accessibility-Applicability-Adjustment Model

• Builds on the other two models

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The Accessibility-Applicability-Adjustment Model

• Available info
• Accessible info
• This model says that effortful mental processing
  leads to

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People Make Adjustments When

• 1. The Influence of biasing factors
• 2. Knowledge about the effects
• 3. People are motivated and able to engage in

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The Accessibility-Applicability-Adjustment Model

• This model is influenced by
• Cognitive closure
• Lots of CC
• Little CC