Consumer psychology
Lectures online, Monday 15-17. 2 tutorials: Tutorial 1 = 1 and 2 December online, opportunity to ask
questions about assignment. Tutorial 2 = 12 and 13 January – 6 minute presentation – on campus.
Exam counts for 40% and assignment for 60%.
Exam = 25/1
Lecture 1 – Introduction
What is consumer psychology?
Consumer behavior is a psychologically based study of how individuals make buying decisions and
what motivates them to make purchase. Several facets:
- How a consumer feels about brands, products, services.
- What motivates a consumer to pick one product over another and why.
- What factors in a consumers’ everyday environment affect buying decisions or brand perceptions
and why.
So more than just products: services: going to the dentist, which TV programme to watch etc.
Marketing management decisions are based on assumptions regarding consumer psychology. You do
everything based on assumptions about the consumer. What makes the consumer? Products don’t
build brands, consumers do (quote you can agree/disagree with). It is not just about having a great
product: do consumers really want or need this? Price/strategy/promotion decisions are made based
upon the understanding they have of consumers. Why/when/what do they buy = the key.
A paper bag: solid, durable, multi-use. How much would you be willing to pay? Market value is 2,22,
but many people are willing to pay only 1 euro. A Vasari paper bag: 100,200,300 or nothing? All
students say buy nothing. A designer paper bag by Vasari was sold out within a week, the value of
,this was 260 euro. According to the Business Insider: the only differentiating factor between the
paper bags is the Jil Sander logo on it.
What drives these consumption decisions?
This question will be answered throughout this course: different reasons and motives. These are
beliefs, financial resources, emotions, psychological states and environment.
Lecture 2: self-concept/identity, beliefs and fundamental psychological needs.
Lecture 3: psychological deficits.
Lecture 4: affects in the marketplace or within us.
Lecture 5: socio-economic status (scarcity).
Lecture 6: motives don’t only define how we consume but also shape prosocial behavior.
Lecture 7: philosophical discussion about if objects/products can lead to happiness.
Lectures: zoom in on specific topics by the use of articles to discuss theories and understand CP
translate this into assignment (60%). Exam is 40%. = about knowledge application.
Experimental consumer research
A folder about experimentation: understanding the topic and terms.
Amateur researcher: why do people wake up in the morning with a headache? a given dataset
with variables: the more people sleep with their shoes on, the more people wake up with a headache
in the morning. But then a senior researcher: why? The dataset has other variables: is there an
underlying reason for both to sleep with shoes on and having a headache: heavy drinking. Sleeping
with shoes and a headache is a correlation, not a causation.
Need to identify whether the studies are based on correlation, or is there really causation?
Experiment lets us isolate cause and effect. Same with ice cream and sun burn: correlation. The cause
is the hot summer weather.
Experiments allow investigators to establish cause-and-effect relationships. In other words, isolate
different effects by manipulating an independent variable, and keeping other variables constant, to
see how it influences a specific outcome variable. Assign people to either sleep with their shoes on or
no shoes, and see if people have more headaches.
Does having a lot of options to choose from make us happy?
Amazon’s phone and accessories category alone contains over 82 million products. We are flooded
with choices. Once their was the idea that people want the most number of things to choose from.
But this is not true; too many choices is time consuming and you don’t know what you want
anymore. Happiness = defined here as post-purchase satisfaction. There is a sweet spot that to the
number of choices that the consumer wants to see.
Intuition isn’t always right; sometimes exactly wrong. Choice
overload refers to a cognitive process in which people have a
difficult time making a decision. It becomes more difficult or
stressful to determine which option is best. We feel sorrow
about the opportunities we forego. Also, when it is not clear
which option is best, you’re more likely to regret the decision
that you eventually make.
,Paper: When choice is demotivating: can one desire too much of a good thing?
Field study: experiment conducted in the real world. Taste trial in supermarket: what happens when
consumers are given a lot of selection for jam or limited selection?
1. Study conducted in a supermarket = field experiment
2. Confederate: research assistants are dressed as employees (not actual researches, but know
the purpose of the research)
3. Tasting booth with either 6 or 24 flavors (this is the manipulation/IV)
4. Observer noted the amount of consumers who approached the table and consumers who did
not stop and sampled jams (dependent variable)
5. Interested shoppers received a redeemable coupon (dependent variable. So 2 DV’s) more
or less likely to redeem coupon and buy jam.
6. Two consecutive Saturdays, displays rotated hourly and counterbalanced between days to
attempt to decrease confounding variables. No differences between days or hours.
24 jams was more attractive: but this does not translate into buying behavior.
6 jams is less attractive, but way more buying behavior.
Also did a lab study: a field study has a lot of things that you can not control for. Did they control for
the music that was playing, the weather of that day? Lab study controls everything (preferred).
Field study: strengths are that they reflect real life, natural setting; higher ecological validity. Less
likelihood of demand characteristics: participants do not know they are being studies. Limitation: less
control over extraneous variables.
Lab experiment: watch the movie 12 angry men. Then randomly assigned to either 6 essay topics or
30 essay topics about the movie that they watched. DV1 = % that chose to write the essay. DV2 = the
quality of the essay. Quality & completion rate was higher in 6 essay topic condition.
Specific critique of the article: choice of the number for the condition is not based on research: is 6
really limited, is 30 really much? You can use a manipulation check for this.
, Choice overload can leave you dissatisfied with the choice you made, what is often described as
byer’s remorse, or lead to behavioral choice/decision paralysis: people don’t know what they want
anymore because there are so many choices.
When are consumers most likely to feel overwhelmed by their options?
Paper: Chernev et al: Choice overoad: a conceptual review and meta-analysis
Found 4 conditions under which consumers may experience choice overload:
1. When people don’t have the time and want to make a quick and easy choice: choice-set
complexity: is there a dominant option, is there information about each option? For example, you
may have five laptop options to choose from but see 10 pieces of information about each. Or you
may be presented 10 laptop options but only one piece of information about each. The former is a
more complex choice set, and is likelier to result in choice overload.
2. Decision-task difficulty: How difficult is the actual act of deciding? Some decisions must be made
quickly, like choosing a meal option from a menu, while others may have much longer time limits or
none at all. The lesser time you have to make a choice the more likely it will lead to choice overload.
Time or energy: all the time and energy in the world will lead to less choice overload.
3. Preference uncertainty: How much do you already know what you want? The more you know
about your preferences, the easier it is to make a choice. If you have already established that buying
a Fairtrade peanut butter is your most important consideration in choosing a peanut butter jar, for
instance, it will be easy to compare multiple options along this dimension: you as a consumer has
reduced the options. Less likely to experience choice overload.
4. Decision goal: Are you buying or browsing? What is the ultimate goal of sifting through all of these
options? If the goal is to make a conclusive choice, that may mean considering trade-offs carefully
and potentially agonizing over a decision. If, alternatively, the goal is just to gather information that
may help with a future decision—such as browsing cars or looking at potential rental homes—then
choice overload may be less likely.
So how can marketers help reduce choice overload?
- Creating a dominant option: Coolblue laptops; 618 laptops, but created a Coolblue’s choice
that is the dominant option.
- Compare options: also Coolblue, compare laptops on criteria via a button. Reducing choice-
set complexity and preferences.