Consumer Behavior Semi Midterm Lesson.pptx

Lesson for BSBA 2nd Year

1. Consumer Learning and Memory

2. WHAT IS LEARNING? Learning is a relatively permanent change in behavior caused by experience. Learning is a relatively permanent change in behavior caused by experience. The experience can be direct or it can be observed. Learning is an ongoing process.

3. What is Learning? Generally, learning is a process by which changes occur in the content or organization of an individual’s long-term memory From a marketing standpoint, learning can be thought of as the process by which individuals acquire the purchase and consumption knowledge and experience that they apply to future related behavior

4. How do we learn? We learn even when we don’t try : We recognize many brand names and how many product jingles, for example, even for products we don’t personally use. We call this casual, unintentional acquisition of knowledge incidental learning.

5. Range of Learning Situations Learning occurs at various levels of consumer involvement Low-level involvement : consumers have little or no motivation to process the information High-involvement learning : consumers are highly motivated to process the information

6. Learning Theories There are many theories about how people learn. They fall into two general categories: Behavioral learning theories Cognitive theories

7. Behavioral Learning Theories Are also referred to as stimulus-response theories because based on premise that observable responses to specific external stimuli signal learning has taken place When a person responds in a predictable way to a known stimulus, he or she is said to have learned There are two behavioral theories with relevance to marketing: Classical conditioning Instrumental/operant conditioning

8. Classical Conditioning The theory that conditioned learning results when a stimulus that is paired with a stimulus that elicits a known response serves to produce the same response when used alone. In marketing, learning through association, where a stimulus (e.g., a brand jingle) is paired with a response (e.g., positive emotions).

9. Classical Conditioning Schematic Presentation of Classical Conditioning Conditioned Stimulus (CS) Unconditioned Stimulus (US) Unconditioned Response (UR) Elicits Comes to Elicit

10. The use of a well-known, admired individual to advertise a product can condition consumers to have positive feelings about the product “Cause marketing”

11. Strategic Applications of Classical Conditioning Three basic concepts derive from classical conditioning Repetition Stimulus generalization Stimulus discrimination

12. Repetition Increases the strength of the association between a conditioned stimulus and an unconditioned stimulus (learning) It is used by advertisers when scheduling media exposure for an advertising campaign Too much repetition can lead to advertising wear out Consumers may become annoyed with repetitive ads and develop a negative image of the product as a result

13. Stimulus Generalization Learning relies not only on repetition, but on peoples’ ability to generalize --that is, respond in the same way to slightly different stimuli Explains why some manufacturers try to make their generic/store brands similar in appearance to name brands

14. Marketers use this principle to take advantage of a well-known and trusted brand in a number of ways Product line extensions Product form extension Product category extension Referred to as the halo effect

15. Stimulus Discrimination Opposite of stimulus generalization Results in the selection of a specific stimulus from among similar stimuli Forms the basis for marketers’ positioning strategy Permits marketers to differentiate their product from competitors’ (through, e.g. different features, colors, ingredients, etc.)

16. Choose 1 business in Guinayangan. Make a suggestion or list ways on how they can use Classical Conditioning to improve the marketing of their product.

17. Answer: A coffee shop offers a free drink after every 10 purchases. A customer decides to stop shopping at a store because they were treated rudely. An airline provides bonus miles for customers who book their flights through their app. A fast-food chain introduces a "no purchase, no free dessert" rule. A cosmetics brand sends personalized discounts to customers who engage with their social media posts.

18. Operant (Instrumental) Conditioning B.F. Skinner Learning occurs through trial and error Habits are formed as a result of rewards for certain behaviors Consumers who try different brands, models, styles until they find the one that “fits” are engaged in instrumental learning

19. Operant Conditioning Specific Behavior Reinforcement or Punishment Increased or Decreased Probability of Response Schematic Presentation of Operant Conditioning

20. Reinforcement A reward given to acknowledge a desired behavior and increase the probability it will be repeated Positive reinforcement Events that strengthe n the likelihood of a specific response Negativ e reinforcement A negative outcome that also serves to encourage a specific behavior Fear appeals

21. Punishment Punishment discourages behavior as opposed to encouraging behavior to avoid a negative result

22. Extinction When a learned response is no longer reinforced, it diminishes to the point of extinction—i.e., there is no longer a link between the stimulus and the expected reward

23. Strategic Applications of Instrumental Conditioning Customer Satisfaction In order to keep its customers, a marketer or business must maximize positive reinforcement This can be done through the product itself Can also be done with other elements of the purchase situation

24. Reinforcement Schedules The pattern in which reinforcements are given Marketers have found that while product quality needs to remain high to satisfy consumers, non-product positive reinforcement does not have to be offered every time

25. Three types of reinforcement schedules: Continuous/total (every time) Systematic/fixed ratio (every “nth” time) Random/variable ratio

26. Time Time Behavior Maintenance Behavior Maintenance Reinforcement Schedules & Forgetting Forgetting occurs more quickly Forgetting occurs gradually over time and the residual effects of learning persist Continuous Reinforcement Intermittent Reinforcement

27. Cognitive Learning The process by which consumers use information processing, problem-solving, and thinking to understand products and make purchasing decisions.

28. Cognitive Learning Learning based on mental activity (i.e. thinking and problem-solving) Unlike simpler organisms, we learn not only by trial and error, but by searching for information evaluating the information, and making a decision about what is best for us

29. Cognitive Learning Theories Insight Learning : Learning through problem-solving and gaining insights into the product. Example: A Jollibee commercial that showcases how a new menu item solves a common dining problem, prompting viewers to consider trying the product.

30. Cognitive Learning Theories Observational Learning : Learning by observing others, such as celebrities or influencers endorsing products. Example: A commercial featuring a celebrity using a local brand like Bench apparel, which encourages consumers to imitate the celebrity's style.

31. Cognitive Learning Theories Information Processing Theory: Learning through receiving and interpreting information, which helps in decision-making. Example: A Globe Telecom advertisement that presents various features of a new data plan, guiding consumers through the benefits and how it meets their needs.

32. Marketing Implications of Cognitive Learning Theory Primary implication is to emphasize the importance of providing information to consumers Providing information can be a promotional strategy as well

33. Brand Loyalty A consumer’s consistent preference for and purchase of a specific brand In high-involvement purchases (e.g., a car) it reduces risk and facilitates selection In low-involvement purchases (e.g., tissues) it saves time and effort Brand loyalty generally results from consistent positive experiences with a company and/or its products

34. There has been a recent decline in brand loyalty Boredom or dissatisfaction with the products Variety-seeking Increased concern with price To counter these actions, marketers have adopted a number of programs (e.g., frequent flyer) that reward brand loyalty

35. Classical Conditioning : Coca-Cola associating the brand with happiness and celebrations in their "Share a Coke" campaign. Operant Conditioning : GCash offering cashback rewards for every purchase using their app. Observational Learning : Influencers like Anne Curtis promoting cosmetics, influencing young Filipinas to try the products.

36. Definition of Attitudes Attitudes are learned tendencies to respond in a consistently favorable or unfavorable manner toward a given object, person, or event. In consumer behavior, attitudes influence how consumers evaluate products, brands, and services.

37. Components of Attitudes 1. Cognitive Component: Beliefs or thoughts about a product (e.g., 'San Miguel Beer is high-quality'). 2. Affective Component: Emotional feelings towards a product (e.g., nostalgia linked to Jollibee meals). 3. Behavioral Component: Actions or behaviors towards a product (e.g., purchasing Oishi snacks regularly).

38. Formation of Attitudes - Attitudes are formed through experiences, social influences, and marketing communications. - Cultural factors play a significant role in shaping attitudes. - In the Philippines, family influence and brand endorsements by local celebrities are common factors.

39. Changing Attitudes 1. Persuasive Communication: Influencing consumer beliefs or emotions. 2. Classical Conditioning: Associating brands with positive experiences (e.g., Jollibee’s 'Kwentong Jollibee' ads). 3. Cognitive Dissonance Reduction: Aligning consumer attitudes with their behavior through marketing strategies.

40. Persuasion Techniques - Source Factors: Credibility, attractiveness, and expertise of the communicator (e.g., Coco Martin). - Message Factors: Content and style of the message (e.g., humor in Mang Inasal ads). - Audience Factors: Characteristics of the target audience (e.g., targeting younger Filipinos on social media).

41. Central vs. Peripheral Routes to Persuasion - Central Route: Involves logical arguments and factual information. Effective when the audience is motivated and able to think about the message. - Peripheral Route: Involves emotional appeal, celebrity endorsements, or attractive visuals. Suitable when the audience has low motivation or ability to process the message.

42. QUIZ This type of learning occurs when a neutral stimulus becomes associated with a meaningful stimulus, leading to a conditioned response. A marketing strategy where customers receive rewards, such as points or discounts, for repeat purchases or referrals. This learning theory emphasizes the role of mental processes in understanding and acquiring knowledge through observation and reflection.

43. QUIZ In this type of conditioning, a consumer develops a preference for a product because it has been consistently paired with positive experiences or feelings. A scenario in which a person avoids a brand after a negative experience, demonstrating a learned behavior based on past outcomes. This learning method focuses on the consequences of behavior, where behavior is strengthened or weakened based on reinforcement or punishment.

44. QUIZ A strategy used by brands where a customer receives a free product after purchasing a specific number of items. The process through which consumers learn about products by observing the behavior of others and the outcomes of those behaviors. This term refers to a learned response that occurs automatically due to the pairing of stimuli, such as salivating at the sound of a bell after being conditioned.

45. QUIZ A promotional tactic where consumers are encouraged to continue buying a product to avoid losing an ongoing benefit, such as a subscription service. TRUE OR FALSE In classical conditioning, the unconditioned response is always a natural reaction to an unconditioned stimulus. Negative reinforcement always leads to punishment.

46. QUIZ -15 What are the three components of attitudes in consumer behavior?

47. Think of a fictional brand (e.g., a coffee shop, a clothing brand) Create a short persuasive marketing pitch for the target costumer of your chosen product. Discuss the following: What specific consumer behaviors do you want to reinforce (e.g., repeat purchases, customer referrals, social media engagement)? What types of rewards will you offer to encourage these behaviors (e.g., discounts, freebies, exclusive access)? How will you structure the rewards (e.g., fixed-ratio, variable-ratio)?