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Consumer Behavior 2022-2023
What we will cover
1. CB in Marketing
a. Consumer decision-making process
b. Dual Process Theory
2. Customer Journey Mapping
a. Attitudes, intentions and behavior
b. Measurement
3. Emotions and Motivation
4. Exposure, Attention, and Perception
5. Cognition and Heuristics and Biases
6. Nudging
7. Consumer Identity
8. Social Influence
9. Cultural Influence
10. Social marketing & Sustainable behavior
Course Material
- Slides Blackboard
- Weekly preparation because continuous assessment
- Mandatory Reading: Nudge the final edition
Practical Assignment: Societal Implication
- Same groups as previous assignment
- Imagine a public health campaign
- Design a social media communication campaign
- Present on May 22nd (10 minutes)
- Attendance during the presentations is mandatory for all students
Assessment
- Continuous Assessment 10% (quizzes)
- Group assignments 40%
o Research assignment 20% and practical assignment 20%
o Peer assessment will follow
- Written exam 50%
o Closed book
o Multiple choice and open questions, dictionary allowed
- Study material
o Slides, lecture notes, guest lectures, the book by Thaler and Sunstein, all articles and
videos assigned for each class
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Inhoud
Consumer Behavior 2022-2023 ............................................................................................................... 1
1. Intro ................................................................................................................................................. 5
1.1. What is consumer behavior? ................................................................................................... 5
1.2. Why should we study Consumer Behavior? ............................................................................ 6
1.3. What does the buyer’s decision process looks like? ............................................................... 8
1.3.1 Need Recognition ................................................................................................................... 8
1.3.2 Information Search ................................................................................................................. 8
1.3.3 Evaluation alternatives ........................................................................................................... 9
1.3.4 Purchase Decision................................................................................................................... 9
1.3.5 Post-Purchase Decision .......................................................................................................... 9
1.4. Consumer decision-making: why it happens? ....................................................................... 10
2. Attitudes ........................................................................................................................................ 11
2.1. What are attitudes?............................................................................................................... 11
2.2. Attitude-behavior change and how can we measure attitudes? .......................................... 13
3. Emotions and Motivations ............................................................................................................ 15
3.1. What are emotions? .............................................................................................................. 15
3.2. Theories of Emotions............................................................................................................. 16
3.3. Emotions and Marketing ....................................................................................................... 17
3.4. What are motivations? .......................................................................................................... 18
3.5. Theories of motivations......................................................................................................... 19
3.6. Motivations and marketing ................................................................................................... 20
4. Exposure, Attention and Perception – Information Processing .................................................... 21
4.1. Exposure ................................................................................................................................ 22
4.2. Attention ............................................................................................................................... 22
4.3. Perception ............................................................................................................................. 24
4.4. Memory ................................................................................................................................. 27
4.5. Implications for branding ...................................................................................................... 27
4.6. From Perception to Cognition ............................................................................................... 28
5. Cognition: Heuristics and Biases ................................................................................................... 31
5.1 First Bias: Anchoring .............................................................................................................. 31
5.2 Familiarity - The Mere Exposure Effect ................................................................................ 32
5.3 Loss Aversion ......................................................................................................................... 33
5.4 Endowment Effect (Based on Loss aversion) ........................................................................ 34
5.5 Confirmation Bias .................................................................................................................. 34
5.6 Availability Bias ...................................................................................................................... 34
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5.7 Expectations Bias ................................................................................................................... 35
5.8 Myopia: Present vs Future .......................................................................................................... 35
5.9 Representative heuristic.............................................................................................................. 35
5.10 Mental accounting..................................................................................................................... 36
5.11 Bias Context Effects ................................................................................................................... 37
5.12 The paradox of choice ............................................................................................................... 37
6. Consumer Identities ...................................................................................................................... 38
6.1. Self-concept ........................................................................................................................... 38
6.2. Social identity ........................................................................................................................ 38
6.3. Influence of Values/ Lifestyle / Personality for Segmentation.............................................. 40
6.4. Branding ................................................................................................................................ 42
6.5. Session overview Consumer Identity .................................................................................... 43
7. Social Marketing and Nudging....................................................................................................... 44
7.1. What is social marketing? ..................................................................................................... 44
7.2. What are frequent techniques in social marketing? ............................................................. 45
7.3. What is the value of public-private partnerships? ................................................................ 47
7.4. What is nudging? ................................................................................................................... 48
7.5. What are frequent nudging techniques? .............................................................................. 49
7.6. Which nudges are used in real life? ...................................................................................... 51
8. Social Influence.............................................................................................................................. 53
8.1. Why so powerful?.................................................................................................................. 53
8.2. Mimicry (examples) ............................................................................................................... 54
8.3. Social prof/Consensus/Conformity (examples) ..................................................................... 54
8.4. Social identity through reference groups (social identity) .................................................... 56
8.5. Cialdini and 7 weapons of influence (see video) ................................................................... 57
9. Consumer culture .......................................................................................................................... 58
9.1. Culture, subculture, (consumer) socialization....................................................................... 58
9.2. Cultural differences East and West ....................................................................................... 59
9.3. Implications for marketing .................................................................................................... 61
9.4. Are cultures fixed vs adaptive ............................................................................................... 62
10. Sustainability ............................................................................................................................. 65
11. Guest College neuromarketing: Professor Desmet ................................................................... 66
11.1. People are irrational .......................................................................................................... 66
11.2. People are predictably irrational ....................................................................................... 67
11.3. Marketing applications ...................................................................................................... 67
12. Guest College Marketing in Open Source: Professor Noury ..................................................... 68
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12.1. What is Open Source? ....................................................................................................... 68
12.2. What are some of the challenges for Open Source Companies? ...................................... 69
12.3. Marketing tools? ............................................................................................................... 70
12.4. Task- Real Contribution ..................................................................................................... 71
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1. Intro
1.1 What is consumer behavior?
1.2 Why should we study consumer behavior?
1.3 What does the buyer’s decision process looks like?
1.4 Consumer decision-making: why it happens?
1.1. What is consumer behavior?
CB is the study of the processes involved when individuals or groups select, purchase, use or dispose
of products, services, ideas or experiences to satisfy needs and desires.
- Examples:
o What would motivate a person to buy a car?
o Why do people keep smoking?
o Why do people buy single use coffee cups (starbucks)?
o What would persuade people to donate blood?
- CB is an interdisciplinary science
o Microeconomics: consumer theory and consumer choice
o Sociology: groups, cultures and societies
o Psychology: the decision process, the learning process, attitudes and motivations
o Social psychology: cognitive and heuristic biases
What’s the difference between a consumer and a shopper?
- Consumer’s buying roles:
o Initiator: initiates the idea
o Gatekeeper: controls access
o User: consumes
o Buyer: actual purchase
o Decider: ultimate buying decision
o Influencer: influences
Comparing consumer and shopper needs
- Consumer:
o User, actually a wider set of roles that a person can fulfil
o Requirements that I need fulfilled by the products I buy for me and my family
o e.g., healthy, durable, filling, tasty
- Shopper:
o Buyer, the person who actually buys the product
o E.g. mostly girls buy the deo for men so the deo with a girl on it is not effective at all
o e.g., variety, value, convenience
CB as a process
- Pre-purchase
o How do consumers decide that they need a product or a service?
o What are the best information sources to learn more about alternative choices?
- Purchase
o How do consumers experience acquiring a product or service?
o What does the purchase say about the consumer?
- Post-Purchase
o Does the product perform its intended function?
o How is the product eventually disposed of, and what are the environmental
consequences of this act?
What determines that one person buys one phone instead of another?
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- Someone might prefer an expensive Iphone and someone else would choose a cheaper
alternative
- CB as subjective and situational
o Subjective:
▪ Consumer: personal influences, psychological influences, social influences, …
o Situational:
▪ Organisational influences: product (packaging, reputation, image, color),
place (where the packages are sold), price, promotion
Consumers’ impact on marketing strategies
- Good business: basic marketing concepts rely on satisfying consumer needs
- Marketers can only satisfy needs to the extent that they understand customers
- Marketers have to understand the wants and needs of different consumer segments
- No “one size fits all”, consumers are irrational
4 Types of Market segmentation
- Marketing segmentation: process of dividing the mass market into subsets of consumers
who share common needs, characteristics and behaviors.
- 4 types:
o Psychographic segmentation:
▪ Categorization of people based on their lifestyle, in combination with
measures of attitudes, beliefs and personality.
▪ Focus on WHY people buy the product
▪ Psychographics: lifestyle, attitudes, interests, beliefs, emotions, values,
aspirations
o Behavioral segmentation:
▪ Exploring groups, audiences and consumers by their actions and behaviors
▪ Looks at WHAT the consumer does
▪ Purchasing behavior, usage behavior, benefit sought, customer satisfaction,
customer loyalty
o (demographic): focuses on WHO buys the product
o (geographic)
1.2. Why should we study Consumer Behavior?
“There is only one boss. The customer. And he can fire everyone in the company from the chairman
on down, simply by spending his money somewhere else”. – CEO of Walmart
Selling concept
- Starting point: the factory
- Focus on existing products: this means selling and promotion
- End: profits through sales volume
Marketing concept
- Starting point: the market
- Focus on the customer needs: this means integrated marketing
- End: profits through customer satisfaction
Marketing is a social and managerial process by which individual and groups obtain what they need
and want through creating and exchanging products and value with others.
Customer needs
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“True marketing starts with the customer. His demographics, his realities, his needs, his values. It
does not ask “What do we want to sell” but rather “What does the customer wants to buy?”
What is value?
- Customer value is consumer’s assessment of the overall capacity of offering to satisfy needs
and wants.
- The values are really determined by the customers.
- You could think that you offer the best value but ultimately what is valuable is determined by
the consumer and that is why it is so important to understand consumer behavior in detail .
Value discipline
- Product leadership
o Best product
o Continuous innovation and creativity. New products to market quickly.
o E.g. Apple
- Operational excellence/cost leadership
o Best total cost
o Leading in price and convenience
o Reduce cost and create efficient value delivery system
o E.g. Ikea, Colruyt, Ryanair
- Customer intimacy
o Best total solution
o Constantly tailor offering to needs of target customers based on knowledge of the
individual customer.
o E.g. Dell
➔ You need to excel in one of these 3 and be okay in all 3
2 types of value
- Utilitarian: functional value, buying the product helps to accomplish tasks
o Functional need that you are trying to seek
o Buying a car: functional need: transportation
- Hedonic: gratification that comes from experiencing an activity or consuming a product
o Usual positive experience
o Buying a car: hedonic value: Ferrari and Bentley with extra features and luxury
The Golden Circle
The purpose has more value than the product itself.
WHY market this product? Everything starts from here?
HOW do you do what you do? Improve marketing strategies to
facilitate the creation of value by generating a better understanding of
WHAT do you do? Ensure that products/service meet consumer needs
Why is CB important in marketing?
- To ensure that products/service meet consumer needs
- Improve marketing strategies to facilitate the creation of value
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- Investigate how consumers think, feel, reason, are influenced by their environment, their
motivations and decisions strategies.
- Explain how marketers can adapt and improve their marketing campaigns and strategies to
more effectively reach the consumer.
1.3. What does the buyer’s decision process looks like?
The Buyer Decision Process
1) Need recognition
2) Information search
3) Pre-purchase evaluation of alternatives
4) Purchase: First moment of truth
5) Consumption: Second moment of truth
6) Post-purchase evaluation
7) Divestment
New Four Step Mental Model
- ZMOT: all research a consumer does
before the FMOT like reading reviews
- FMOT: first interaction between a
shopper and a product on a store’s shelf
1.3.1 Need Recognition
- Difference between current and desired situation
- Internal stimuli: Hunger, thirst, tiredness
- External stimuli: situational, advertising, …
First implication for marketers: be aware of needs.
Second implication for marketers: be aware of need inhibitors.
Third implication for marketers: needs can be stimulated.
1.3.2 Information Search
Sources used during information search:
- Internal search: information from memory and personal sources: family and friends
- External search: commercial sources (advertising), public sources (media), personal
experience (using the product)
Brand Sets: Traditional view
- In the traditional funnel metaphor, consumers start with a set of potential brands and
methodically reduce the number to make a purchase.
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1.3.3 Evaluation alternatives
Non-compensatory models of choice:
- Conjunctive heuristics: minimal requirement for all important attributes
o e.g. book vacation: apartment, price, location, … x filters that need to be fulfilled
o Depending on your criteria, you will get a different selection of options
- Disjunctive heuristics: at least one attribute level acceptable
o Price is usually the first level
- Lexicographic heuristics:
o Rank attributes in order of importance
o Brand that scores best on most important attribute is chosen
o Tie: brand that scores best on 2nd most important attribute is chosen etc
- Elimination-by-aspects heuristics:
o Rank attributes in order of importance
o Brand that score acceptable on most important attribute continue to round 2
o Round 2: all acceptable brands on second most important attribute etc
Compensatory models of choice
- Weigh pros and cons each brand and select best total option
- Strong performance of important attribute(s) can compensate for weak performance on
others
1.3.4 Purchase Decision
Four types of consumer buying behavior
“Involvement represents the perceived
relevance of an object based on one’s
needs, values and interests.”
Impulse buying
- 80% of our buying is impulse buying
- Pure impulse buying: no intention
- Planned impulse buying: intention, but wait for occasion (based on promotional discount)
1.3.5 Post-Purchase Decision
“Analyzing what happens after a sale is as important as understanding what causes consumers to buy
in the first place. In fact, because this is an analysis of actual rather than potential customers and
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purchase situations, enlightened marketers consider post-purchase behavior of primary importance
in its impact on future sales.”
Post-Purchase Dissonance
- Related to cognitive dissonance
- Buyer’s remorse
- Doubts or anxiety about the wisdom of the purchase
- Most likely to happen when the decision is important to consumers
Reducing post-purchase dissonance
- Communication: reaffirm buyers, follow-up calls
- Policy: good return policy, money-back guarantee
- Sense of belonging: VIP, club membership
1.4. Consumer decision-making: why it happens?
Complex Model of Decision-Making
Generative Theories
- Dual-process theory: human behavior is driven by two different systems
- Fast thinking and slow thinking
- Example of the baseball and bat that cost together 110EUR.
