Lecture 1- introduction
It is informative to see how researchers want to present their information to people
- The textbooks are very pre-pandemic, things have changed a lot since these books
were published
- All of the books highlight people and the idea that consumer behavior is about people
going out in the world, interacting with other people
- The idea of brands and brand logos → you can see kfc, burger king etc. consumer
behavior is about how people interact with brands, how they decide whether they
want to buy product or not
- Technology is an important issue. Consumer behavior is shaped in large part by
technology which shows how we interact with each other and how we interact with
brands. We buy a lot online; we want to know how online platforms work (social media
for example) and how this shapes the ideas we have.
What is consumer behavior?
The processes involved when selecting, purchasing, using or disposing of goods and services,
ideas or experiences to satisfy needs and desires.
1. Choice→ choosing to buy a product or get rid of it
2. Deals with goods and services, ideas or experiences → the common idea that people
have is about tangible consumer goods e.g. buying a can of soup in the supermarket.
Consumer behavior is more than that. Do you follow the corona restrictions, will you
get a vaccine? It is all about how people perceive information and how they make
decisions based on that
3. Needs and desires → if we want to understand decision-making and the behaviors and
goods that people choose. We have to understand what they are and what they mean
a. A cyclical process
i. Needs and desires, what are they and how do they motivate us to make
choices. What gets us out of bed in the morning to take action
ii. Selecting, purchasing and using products. When we are in the situation
of making a decision, how do we choose between options? Do we do it
in a rational way or do we focus on some aspects of information,
ignoring things we consider to be irrelevant
iii. Outcome of decisions. Our decisions do not end when we decide to
spend money. Most of the time we are not satisfied and want to start
the whole cycle again
, 1. What do we need? – Maslows hierarchy of needs
We go through certain challenges and as we fulfill those needs, we move on to the
next. We start with physiological needs, a roof above or heads, then we want safety
etc. there are some needs in this hierarchy more salient. These needs guide us to
certain products and outcomes.
2. Making choices
We can understand decisions as a conflict between rational deliberation, which is
making a calculated choice. Or automated decisions, based on our gut feelings. There
might be some situation that make us better off trusting our guts.
3. Assessing outcomes
What can a general consumer do to live a satisfying life? On the left there are increases
in wealth in the US in the 21st century. The GNP is increasing a lot, people have more
money, they can buy more products, there are more product options. However, on the
right we see changes in happiness over time. People were less happy as time increases.
We want to understand if earning money makes us happier. If it is not money that
makes us happy, what can we do to increase happiness?
Why study consumer behavior?
- Better marketing for companies→ the most common approach. In the two thousands
and two thousand-tens people found out that we can learn a lot from experiments.
Researchers in industry are constantly using experiments to try and improve their
marketing.
o Better marketing- Christian (2012)
▪ A/B testing is used by tech companies to improve website performance
How many search results per page?
• What is the best slogan or headline?
• Which payment service should my website use?
o Better consumer decisions= we can help to make roadmaps for ourselves and
people that we know because everyone makes decisions.
▪ Resisting social influence
• Learn to identify marketing and persuasion techniques
▪ Using heuristics (simple rules of thumbs)
• When should you ‘trust your gut”
▪ Decision aids
• Record and organize important information
, o Better decisions for policy makers
▪ This is also about public policy and government
Since the two thousand, people are interested in how the government can use
‘nudge’ theories to improve healthy living and public policy. These are all
attempts to improve public decision-making and they do not always work. We
should not always trust our common sense when we make policy. We need
data because we cannot always predict how people react. E.g. there are rules
in the US over calorie count. People were buying too much unhealthy food, so
policymakers used calorie counts so it was easier for people to see how much
calories they were consuming in order for them to make healthier choices. In
the US, there are a lot of options you can choose for on the side, it is important
to realize that there is colored information along with these options.
Researchers found that giving this colored information does not help people to
make healthier choices.
• People do not know what to do with the calorie count. They do
not know how many calories they can take for dinner or a day
• People do not go for a healthy option when they go to KFC but
rather for a cheap option. When you see you get a lot of calories
for less money it stimulates to buy the unhealthy food. So, it
works stimulating instead of discouraging
▪ Information helps but what is more important is relying on empathy
for social connection. People will sooner engage in social distancing
when others are also behaving that way.
Lecture 2
Part 1. Consumer perception
, Sensation: responses form sensory receptors (eyes, nose, ears, mouth, skin) to stimuli like
light, color and sound. It is basically how our body reacts on stimuli and how these organs
respond to these stimuli or don’t in some cases.
Sensory stimuli
Environmental information received through sensory receptors.
But we are not able to sense every stimulus in the environment. Our sensory organs don’t pick
up on everything in the environment. This is good because otherwise we would sense every
change in the environment. What DO we sense?
- Thresholds: levels of strength or intensity that stimuli must exhibit to be sensed. We
must perceive some level to be able to sense anything
o Absolute threshold= the lowest possible amount of stimulation that can be
detected by sensory receptor. The limit of what we are physically capable of
sensing. E.g. the smallest amount of light that our eyes can sense or the lowest
decibel that our ears pick up
▪ Detection is not all or nothing→ the question for researchers when they
are investigating what our thresholds are is more about how much
better you are in guessing
▪ When is detection greater than chance?
▪ People are playing really faint sounds or presenting faint light. The
respondents should say when they see or hear something. The absolute
thresholds when people go beyond guessing but are actually able to
notice a stimulus. E.g. when can you differentiate between black and
really dark grey?
▪ Individual differences
• Sound perception
o Playing sounds that only young people could hear in a
room. Older people should not hear it so it does not
matter because only young people will be annoyed.
• Taste perception
o How many taste receptors do you have? Everybody can
take a circle, cover the tongue in blue coloring substance
and count the receptors in the circle. You can see if one
is an extreme taste preceptor, someone who can tell the
difference between different tastes
o Differential threshold= the smallest possible change in a stimulus or (difference
between stimuli) that can be detected.
▪ just noticeable difference (JND)
