Wheel of Consumer Analysis Customer Decision Marking Information Processing

1. http://video.pbs.org/video/1757221034 Magic and the Brain Wheel of Consumer Analysis Customer Decision Marking Information Processing PBB#2 1

2. The Wheel of Consumer Analysis • The dynamic interaction of • affect and cognition, • behavior, and • environmental events • by which human beings conduct the exchange aspects of their lives. Affect & Cognition Behavior Marketing Strategy Marketing Strategy Environment PBB#2

3. Affect and Cognition • Affect and cognitionare different types of psychological responses customers can have in a customer environment. • Customers can have both affective and cognitive responses to any element in the Wheel of Consumer Analysis. PBB#2 3

4. The Wheel of Consumer Analysis Affect A consumer’s feelings about stimuli and events. Affect & Cognition PBB#2 4

5. Basic Characteristics of the Affective System A person’s affective system usually responds immediately and automatically to significant aspects of the environment. PBB#2

6. The Wheel of Consumer Analysis Cognition The mental structures and processes involved in Affect & Cognition PBB#2

7. Consumer Cognition A major function of cognitive systems is to interpret, make sense of and understand significant aspects of personal experience. • Understanding • Evaluating • Planning • Deciding • Thinking PBB#2

8. Affective System Cognitive System Affective Responses Emotions Feelings Moods Evaluations Cognitive Responses Knowledge Meanings Beliefs The Relationship Between the Affective and Cognitive Systems Environment PBB#2

9. The Wheel of Consumer Analysis Behavior The physical actions of consumers that can be directly observed and measured by others. Behavior PBB#2

10. The Wheel of Consumer Analysis Environment Everything external to customers that influences what they think, feel, and do. It is the medium in which stimuli are placed to influence customers. Environment PBB#2

11. The Wheel of Consumer Analysis Marketing Strategy A plan designed to influence exchanges to achieve organizational objectives. Marketing Strategy PBB#2

12. Marketing Strategy A set of stimuli placed in consumers’ environments designed to influence their affect, cognition, and behavior. Typically, a marketing strategy is intended to increase the probability or frequency of certain customer behaviors. PBB#2

13. Cognitive Processes in Customer Decision Making PBB#2

14. Important Cognitive Processes in Consumer Decision Making • 1. Interpretrelevant information in the environment to create personal knowledge or meaning • Combine orintegratethis knowledge to evaluate products or possible actions and to choose among alternative behaviors • 3. Retrieveproduct knowledge from memory to use in integration and interpretation processes PBB#2

15. General knowledge is stored in memory as propositions that link or connect two concepts. Types of Knowledge 1. General Knowledge Concerns people’s interpretations of relevant information in their environments. PBB#2

16. Example 1: Semantic are Expensive Nikon cameras Example 2: Episodic was fun Texas weekend Examples of General Knowledge PBB#2

17. A production is a special type of “if…, then…” proposition that links a concept or event with the resulting appropriate behavior. Types of Knowledge 2. Procedural Knowledge Knowledge that is stored in memory as a production. PBB#2

18. Example 1: Dissatisfied with the service of a restaurant Do not leave a tip Example 2: If the phone rings when you are busy Do not answer it Examples of Procedural Knowledge PBB#2

19. Information Processingand Memory Stores Sensory Memory (Senses) Working Memory (Short-term Store) Long-term Memory (Assoc. Network) External Stimuli Input PBB#2

20. Sensory Memory (Senses) Working Memory (Short-term Store) Long-term Memory (Assoc. Network) External Stimuli Input • Processing • Typical • 2. Special • Rehearsal • Chunking External Stimuli– Sensory input Sensory Memory Receptors – Gathers of external stimuli Forgotten; Lost PBB#2

21. Sensory Memory (Senses) Working Memory (Short-term Store) Long-term Memory (Assoc. Network) External Stimuli Input Recall (Retrieval, Activation) The process by which knowledge structures are formed and changed as consumes interpret new information and acquire new meanings and beliefs PBB#2

22. Spreading Activation Usually unconscious and occurs as interrelated parts of a knowledge structure that may be activated during interpretation and integration processes (or even daydreaming) PBB#2

23. Sensory Memory (Senses) Working Memory (Short-term Store) Long-term Memory (Assoc. Network) External Stimuli Input Integration Combining knowledge to for attitude and decision judgments Interpretation Make sense of or determine the meaning of the environment and one’s own behaviors and internal affective states PBB#2

24. Customer Reality is Not Always the Same as Objective Reality • Reference Price (Point of Comparison) • Spending vs Saving • Endowment Effect • Inertia vs Change PBB#2

25. Sensory Memory (Senses) Working Memory (Short-term Store) Long-term Memory (Assoc. Network) External Stimuli Input Associative Network -- An organized structure of knowledge, meanings, and beliefs about some concept such as a brand. Nodes (concepts) Links (beliefs) Each meaning concept (node) is linked to other concepts (nodes) to form a network of associations PBB#2

26. ASSOCIATIVE NETWORK Long- wearing tread Can wear with jeans, too Weight Cost $94 Cushioning Color Nike Running Shoes Swoosh symbol Feeling after a long, hard run Proud Status brand How to run lightly Lace shoes tightly Wear cushioned socks Relaxed Tired PBB#2

27. Sensory Memory (Senses) Working Memory (Short-term Store) Long-term Memory (Assoc. Network) External Stimuli Input Learning Processes The process by which knowledge structures are formed and changed as consumes interpret new information and acquire new meanings and beliefs PBB#2

28. Cognitive Learning 1. Accretion - Adding new meaning and beliefs to existing knowledge structures Long- wearing tread Can wear with jeans, too Weight Cost $94 Cushioning Color Nike Running Shoes Swoosh symbol Feeling after a long, hard run Proud Status brand How to run lightly Lace shoes tightly Wear cushioned socks Relaxed Tired PBB#2

29. Cognitive Learning At Wilson Sporting Goods Long- wearing tread Can wear with jeans, too Weight Cost $94 Cushioning Color Nike Running Shoes Swoosh symbol Feeling after a long, hard run Proud Status brand How to run lightly Lace shoes tightly Wear cushioned socks Relaxed Tired 2. Tuning - Parts of a knowledge structure are combined and given a new, more abstract meaning PBB#2

30. Cognitive Learning 3. Restructuring Nike Shoes Revising an entire associative network by reorganizing an old knowledge and creating entirely new meanings PBB#2

31. FrequencyComplexity 1. Accretion 2. Tuning 3. Restructuring Cognitive Learning PBB#2

32. Information Processing and Memory Stores Activation Retrieval Sensory Memory (Senses) Working Memory (Short-term Store) Long-term Memory (Assoc. Network) External Stimuli Input Accretion Tuning Restructuring Rehearsal Chunking Unavailable Forgotten; lost Forgotten; lost PBB#2

33. Associative Network Sweet Moderately Sweet Caffeine Lem/Lime Flavor Tasty Cola Tasty Lem/Lime Pepsi Sprite Clear Caramel Color Cola Flavor Fizz/Re- Freshing Caffeine Free PBB#2

34. Associative Network Poor Cola Taste Sweet Moderately Sweet Caffeine Lem/Lime Flavor Tasty Cola Tasty Lem/Lime Pepsi Sprite Clear Caramel Color Cola Flavor Fizz/Re- Freshing Caffeine Free Pepsi Crystal PBB#2

35. Associative Network Sweet Moderately Sweet Caffeine Lem/Lime Flavor Tasty Cola Tasty Lem/Lime Pepsi Sprite Clear Caramel Color Cola Flavor Fizz/Re- Freshing Caffeine Free Sugar Free Diet Pepsi Woman’s Drink After Taste Moderately Tasty Cola PBB#2

36. Associative Network Pepsi One Woman’s Drink Sweet Moderately Sweet Caffeine Lem/Lime Flavor Tasty Cola Tasty Lem/Lime Pepsi Sprite Clear Caramel Color Cola Flavor Fizz/Re- Freshing Caffeine Free Sugar Free Diet Pepsi Man’s Drink After Taste Moderately Tasty Cola PBB#2