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Lecture notes: Advertising and Consumer Psychology
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Lecture notes of all the lecture including the guest lecture (2018)
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Lecture 1. Psychology of MarComAH
The abbreviation of Albert Heijn is AH, which is pronounced as ahaa. The most important
function of ads is creating brand recognition. Repetition (mere exposure effect) is key for
creating brand recognition.
Open and closed SSN
The trend nowadays → closed social networks are growing fast. This network requires
permissions to see certain content, you won’t see things that you don’t seek out specifically,
and there are little to no stats to validate your activity. Here’s the most notable social
networks ranked from most to least open: Twitter is very open, Facebook is little open,
Instagram/snapchat are pretty closed.
A very short history
o 1882 → the first product placement in an advertising
o 1980s → personal selling (banging at the door of houses)
Key function of ads → brand awareness; repetition. If you repeat stuffs and do it frequently,
it stays in memories of people that watch it, especially when people are low involved. SEO is
very efficient when people are high involved. When you’re high involved, you’re Googling and
SEO makes you appear to find more easily when you’ve high involved audience. Replica → AI
friend application (chatbots) and Luka → location-based advertising based on what you like
and makes recommendations for instance places for where to lunch.
Marketing
= the activity, set of institutions, and processes for creating, communicating, delivering, and
exchanging offerings that have value for customers, clients, partners, and society at large
(AMA, 2016).
o Marketing mix → product, place, price, promoting, people, physical context, process.
o Multiplicative (→ you can only reach your ideal effect when all three factors are high;
these three steps need each other) Marketing Steps (→ what do you have to do for
building a strong brand):
• Watch Mark Ritson video (https://www.youtube.com/watch?v=pUB-jLlsGsk) →
diagnosis (research), strategy (for who is my brand, what do they want, and how
a’m going to deliver it to them), tactics (four ps)
,Integrated marketing communication
= capitalization on the multi-channel life to create a competitive advantage
Brands
Mr. Alfred Heineken (1992) → “Mr. Voorn, when my breweries burn down tonight, I will get
a loan tomorrow to rebuild them all on the basis of the value of my brand. But, Mr. Voorn,
when you burn down my brand tonight I will be stuck with a lot of empty breweries in the
morning!” Also read the book → how brands grow (barron)
o Brand = more than a product:
• “The intangible sum of a product’s attributes → its name, packaging, and price,
its history, its reputation, and the way it’s advertised.”
• “A name, sign, or symbol used to identify items or services of the seller(s) and
to differentiate them from goods of competitors.”
• “Products are made in the factory, but brands are created in the mind.”
The ways you can look at the value of brands: via a cultural perspective, cognitive
psychological point of view, as an organising phenomenon of companies
o Brands are association network in the brain → a brand is a bundle of benefits with
sustainable differentiation potential
1. Utilitarian benefit: e.g. taste, energizing
2. Economic benefit: e.g. price
3. Social benefit: acceptance (lifestyle)
4. Aesthetic benefit: e.g. Bottle design
5. Hedonistic benefit: e.g. Pleasurable use
Benefit has to be:
• Important or motivating to target consumers
• Deliverable by the brand (how well do all brands in target category deliver
various benefits?)
• Unique to the brand → differentially superior delivery
,Building brand equity
Brand equity is based on brand loyalty, brand awareness, perceived quality, brand
associations, and brand assets. Based on this, companies started to calculate the financial
perspective on brands. Companies do this because this creates a higher potential to loan more
money from the banks when the financial brand value is known. However, this is not allowed
anymore. Not it is still useful to this for instance when you want to sell your brand (goodwill).
Why do we need to consider the financial value of the brand?
1. Can easily borrow money from the bank
2. Worth more in the stock exchange
, Consumer behaviour
Thinking in human being is more limited compared to automated/unconscious act towards
brands. Decision process relates to system 2 (automatic).
Advertising: inform, persuade, remind
“Advertising is any form of paid communication by an identified sponsor aimed to inform
and/or persuade target audiences about an organization/product/service/idea”. Ads can be
B2C, B2B, B2E (business-to-employees), non-profit (organisations, political parties, causes).
There can be a big disparity between what you see and what actually happens.
o Application areas
• Profit (B2C)
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