Summary of Chapter 8

Summary of Chapter 8

Announcement Quiz on the 23rd of May 2 Chapter Five Slide 2

Homework Subject: - Explain Hedonic and Utilitarian products. - Give detailed consumer behaviour characteristics of both Hedonic and Utilitarian shoppers - Explain the differences between Hedonic and Utilitarian shoppers. Dead Line: 23th of May 2016 Format: Report. Not more then 3 papers. Printed file. 3 Chapter Five Slide 3

Announcement Project: Will give the project of Wednesday. Check out the announcement through the system Dead Line: 6th of June, 2016. 4 Chapter Five Slide 4

Learning Relating one s past knowledge to present circumstances and applying past and present experiences to future behaviours. The process by which individuals acquire the purchase and consumption knowledge and experience that they apply to future related behavior Chapter Seven Slide 5

7.1 Elements of Learning Theories Motivation Unfilled needs lead to motivation and spurs learning Cues Stimuli that direct motives Response Consumer reaction to a drive or cue Reinforcement Increases the likelihood that a response will occur in the future as a result of a cue Chapter Seven Slide 6

Two Major Learning Theories Behavioral Learning Based on observable behaviors (responses) that occur as the result of exposure to stimuli Stimulus- responce learning Cognitive Learning Learning based on mental information processing Often in response to problem solving Chapter Seven Slide 7

7.2 Behavioral Learning 1. Classical Conditioning: Automatic responce to a situation built up through repeated exposure. 2. Instrumental (Operant) Conditioning: Learning occurs through trial and error process, with habits formed as a result of received reward from trial. Chapter Seven Slide 8

7.3 Information Processing and Cognitive Learning Learning involves complex mental processing of information Emphasizes the role of motivation Cognitive Learning Chapter Seven Slide 9

Involvement Degree of personal relevance that the product or purchase holds for that customer. High involvement purchases are very important to the consumer (in terms of perceived risk). Complex, goal oriented purchases Low-involvement hold little relevance, have little perceived risk, and provoke limited information processing Chapter Seven Slide 10

CHAPTER NINE Communication and Consumer Behavior

Learning Objectives 1. To Understand the Role of the Message s Source in the Communication Process. 2. To Understand the Role of the Message s Audience (Receivers) in the Communication Process. 3. To Learn About Advertising Media and How to Select the Right Media When Sending Promotional Messages Targeting Selected Consumer Groups. 4. To Learn How Understanding Consumers Enables Marketers to Develop Persuasive Messages. 5. To Understand How Marketers Measure the Effectiveness of Their Promotional Messages. 12

Which Type of Communication Is Featured in This Ad, and What Strategic Concept Does It Get Across? 13

Nonverbal Used for Positioning 14

Basic Communication Model Figure 9.2 15

9. 1 The Source as the Initiator Formal Communication Source Marketer or organization Informal Source A parent, friend or other consumer 16

The Source - Impersonal and Interpersonal Communications 1. Impersonal Communication Communication of organisations through avdertising, Public Relations, spokepersons. 2. Interpersonal Communication One to one communication - Formal sources: sales person - Informal sources: peers that consumers communicate face to face or via electronic means. 17

Source Credibility Source Credibility: The perceived honesty and credibility of the source of communication has influence of on the acceptance of the info by receiver. 18

The Source - Rererence Groups: Reference Groups Normative: Influencing defined values or behaviour Comparative: Benchmark spesific but narrow part of ones lifestyle. Membership: Symbolic: the consumer is not member but takes the values anf attitutes of the group 19

The Source: Informal Sources Informal Sources Opinion leaders: category spesific opinion leaders or influencers. Word of Mouth: Two way communication. Take place face to face, through online, telephone 20

The Source: Word of Mouth as an Informal Source Word of Mouth and ewom Two-way communication Social networks Brand communities: Online forums Message boards and Blogs 21

The Source Word of Mouth Strategic Applications Buzz Agents E-ferrals and recommendations: sending notices about ones selections Viral Marketing Online viral campaigns need to be managed carefully to tackle negative comments 22

Viral Marketing VIRAL Circulation of something that is threw out by somebody like an injected virus that captures the body 23

Viral Marketing- Case Sony Xperia BEST PRACTISE: LAUNCH OF OBJECTIVES 1- To launch the new product 2- To increase the awareness of the water resistance and other technical spesifications of the new device 24

Viral Marketing- Case Sony Xperia SCREEN QUALITY WATER PROOF NIGHT VISION BATTERY LIFE First ever only digital product launch in Turkey 25

Viral Marketing- Case Sony Xperia Viral video was promoted through several different channels. Owned social media: Video platforms: 27

Viral Marketing- Case Sony Xperia Total Reach: 9.5 million people through Video watched 944 thousand times. (view/reach ratio: 9.5%) new fans in : 16.500 Total engagement in 13%) : 50.458 (engagement / view ratio: a. 34.247 like, b. 6196 comments (98%positive) c. 10.015 shares 28

Negative WOM with celebrity endorseme 29

Discussion Questions How have informal sources affected your decision as a consumer? Which informal sources are the most powerful? Why? When? 30

Institutional advertising Publicity or PR Endorsers, spokepersons The Source Credibility of Formal Sources 31

Why Are Consumers Likely to Perceive This Ad as Credible? 32

A Glamorous Celebrity Endorser is More Likely to be Perceived as a Credible Source, Especially for a Hedonistic Product. 33

Celebrity Recommendation through Social Media 34

Discussion Questions Who do you consider credible spokespeople? Why? Can you think of certain ads with credible spokespeople? Ads with spokespeople who are NOT credible? 35

Credibility of Formal Sources Endorser Effectiveness Effectiveness is related to the message and its ease of comprehension Synergy between the endorser and the product types is important. (Match up theory) Endorser s demographic characteristics should be similar to the target Endorser credibility is not a substitute for corporate credibility Endorser s words must be realistic for them 36

Ease of comprehension When message comprehension is low, receiver s rely on the celebrity s credibility in forming attitudes toward the product. 37

Synergy between product and the celebrity According to associated learning theory, celebrities are conditioned with the product they promote. 38

Credibility of Formal Sources Other Credibility Sources Vendor Credibility The reputation of the retailers Medium Credibility The credibility of the magazine, website, or radio station Effects of time The sleeper effect: Disassociation of the mesage from the source over time. Phenomenon when the consumer does not remember the source 39

9.2 The Receivers as the Target Audience All audiences interpret the message according to their; - personnal preceptions - personnal experiences Pictures Words, Symbols spokepersons Expectations Experiences Characteristics Motives Involvement Mood 40

9.2 The Receivers as the Target Audience Personal characteristics and motives Personality, demographics, social groups, and lifestyle have impact on how the message is received. Involvement and congruency Mood Increased contrast may increase the power of the message. 41

Barriers to Communication Barriers to communication Selective perceice/exposure to messages Selective exposure to media (with improved technology) Psychological noise Competing advertising mesages Distracting thoughts 42

Overcoming Psychological Noise Repeating exposure to advertising messages Contrast to break through clutter Customized promotion messages Effective positioning Offering unique value propositions 43

9.3 Media as the channels for Transmitting Messages Media: Mass Media: Interpersonal Nontraditional (New) Media Traditional media Untraditional media Mass Media TV Radia Newspaper Magazines Outdoor PR Direct Marketing Direct Mail Broadcast Print Online media Digital advertising SEO- Search engines Blogs, Forums Online PR Mobile ads Interactive TV E-direct marketing 44

Mass Media Requirements of Media Strategy when advertising on Mass Media: 1. Consumer Profiling 2. Audience Profiling 45

9.3 New Media Nontraditional (New) Media is: Addressable Customized and addressed to different receivers Interactive Receivers can interact with the sender Response measurable Receiver's response can be measured 46

The Shift From Traditional To Nontraditional Advertising - Figure 9.5 47

Nontraditional Media Out-of-home and On-the-go Advertising screens in buildings and transit Digital billboards on roads Ambient advertising (in new places) Online and Mobile Includes consumer-generated media: sponsored content on blogs, forums, social networks Narrowcast messages Mobile Interactive TV (itv) 48

Ambient Advertising 49

Ambient Advertising Dental Care 50

Mobile Advertising By shooting the barcode of a product, consumers may reach the relevant online pages of the product. Comparison sides, forums etc. With the use of the GPS navigation aps, companies track the location of consumer and send relevant mesages to call for action 51

Media (Channel) Congruence with message Addressable advertising Branded entertainment 52

Case: Sony Xperia Objective -Trigger the target segment Relevancy: To grab the attention of iphone users when they need battery - Direct targeting to iphone users Description When click ntvmsnbc web sites, iphone users who are under 20% battery life, get a direct advertising. Message: Your battery is uder 20%. Xperia Z3 s battery life lasts 2 days. Demandgreat. Measurement Target: 900.000 views 53

Mobile activities to increase relevancy iphone users under 20% battery life, who click on ntvmsnbc web site get this message. 54

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