- What is perceptional experience? Discuss different aspects of perception and its impact on consumer behavior.
ANS- When you see a ripe lemon in a supermarket, it seems eminently reasonable for you to believe that a lemon is there. Here you have a perceptual experience since you consciously see something yellow. And your experience seems to justify your belief since your experience seems to make it reasonable for you to believe that a lemon is there.
Our perceptual experiences of the world outside us seem to justify our beliefs about how the world outside us is. If that´s right, a question in the epistemology of perception remains open: how do our experiences justify beliefs about the external world? And a question in the philosophy of mind remains open as well: what are our experiences themselves like?
This entry will survey interactions between the epistemology of perception and the philosophy of mind. Following the existing literature, the focus will be on visual experience. The reader is invited to consider how generalizations to other senses might or might not succeed.
Section 1 considers theories of experience and what implications they might have for the epistemology of perception. Section 2 considers perceptual phenomena, such as attending or dreaming, with special implications for the epistemology of perception.
Consumer buying behavior can be defined as a series of activities people engage in when searching, evaluating, selecting, purchasing, using and disposing of products and services so as to satisfy their needs and desires.
In the store, the packaging acts as a gateway to the product. Consumers look at the packaging and respond to how it makes them feel at that moment. If the consumer feels that the product can potentially satisfy their needs, it influences their buying behavior.
This feeling is a result of choices made across several cognitive stages, thus most consumers find it to be complex and overwhelming at times. Since consumers are often in state of confusion, the most important role of packaging is to alleviate their fears. This article analyzes a typical consumer buying behavior in detail to highlight the role of packaging throughout.
Packaging As The Stimulus
Based on Ian Pavlov’s classical conditioning theory, we can treat the consumer as a subject who gets exposed to a product on the shelf, wrapped in its packaging, as the stimuli. The stimuli in this case is heavily cultured to affect subject’s response and achieve a desired consumer behavior.
Decision Making Along Path To Purchase
The classical conditioning theory suggests that product packaging directly influences a consumers perception of the product. And the influenced value perception of product is bound to affect consumers buying decision.
Perceived value may be seen as an “an overall assessment of the utility of a product based on perceptions of what they receive (quality) versus what they give (price)”.
Making a buying decision involves consumers to go through several cognitive and affective mental stages before they make a choice. When consumers recognize a need by themselves or upon provoking, they start to actively look around and consume information available across various channels. Based on what is presented to them during these stages, they form an attitude towards particular choices they begin to trust. After a choice is made, and consumer decides to make a purchase they continue to evaluate their decision while enjoying the product experience.
Perception Building Across The Path
To ease the burden of making a buying decision, consumers seek inputs from their reference groups — family, friends, colleagues, reviews on online forums, and several other means. Each of these inputs acts as a signal that affect their attitudes and perception towards the product. But filtering information to find the right signals is difficult and it is even harder to retain this information. There are evidences showing that consumers retain only the information that either appeals to them emotionally or one that strengthen their beliefs.
When exposed to conflicting signals, consumers get confused and tend to exhibit impulsive buying behavior. Under such circumstances, they rely on product packaging to provide visceral cues which enables them to skip through several decision making stages.
An adaptation from Torben Hansen’s conceptual framework explores relationships between various aspects affecting consumer perceptions as they progress through various stages — if consumers perceive a product as highly valued, they get satisfaction from actively engaging themselves in the decision making process.
Consumers directly equate price with quality. They expect products with high price to offer a high quality experience over other. Throughout the decision making process they look for cues to validate their own expectations. If consumers spent time in validation and available cues indicate a superior quality, they often create emotional ties.
When the perceived value of a purchase decision is very high (its financial or social implications), consumers are very cautious. This explains why people are careful when purchasing gifts, or planning for special occasions. Consumers are willing to spend time, involving themselves into the process and ensuring they choose the best under given circumstances. The degree of involvement is subject to consumers personal, psychological, and social contexts hence the extent of their pursuit can’t be determined but their willingness to engage is certain.
When perceived value of a purchase decision is low (for routine decisions), consumer tend to take impulsive decisions. This explains why over 70% purchases in supermarkets are unplanned. Although, consumers appear to skip most stages during impulsive buying, cognitively they are responding to the visceral cues from product packaging in many cases and making instant snap judgements about product quality. The importance of these cues in shaping purchase decision can be assumed from the fact that every 9 out of 10 consumers prefer in-store purchase when 5 of them had already researched online
- Would a consumer be more likely to follow a central route or a peripheral route to persuasion when deciding what type of personal computer to buy? Why? Explain how a marketer might use your answer to construct an effective ad for a personal computer?
Persuasion theorists distinguish between the central and peripheral routes to persuasion (Petty & Cacioppo, 1986). The central route employs direct, relevant, logical messages. This method rests on the assumption that the audience is motivated, will think carefully about what is presented, and will react on the basis of your arguments. The central route is intended to produce enduring agreement. For example, you might decide to vote for a particular political candidate after hearing her speak and finding her logic and proposed policies to be convincing.
The peripheral route, on the other hand, relies on superficial cues that have little to do with logic. The peripheral approach is the salesman’s way of thinking. It requires a target who isn’t thinking carefully about what you are saying. It requires low effort from the target and often exploits rule-of-thumb heuristics that trigger mindless reactions (see below). It may be intended to persuade you to do something you do not want to do and might later be sorry you did. Advertisements, for example, may show celebrities, cute animals, beautiful scenery, or provocative sexual images that have nothing to do with the product. The peripheral approach is also common in the darkest of persuasion programs, such as those of dictators and cult leaders. Returning to the example of voting, you can experience the peripheral route in action when you see a provocative, emotionally charged political advertisement that tugs at you to vote a particular way.
Triggers and Fixed Action Patterns
The central route emphasizes objective communication of information. The peripheral route relies on psychological techniques. These techniques may take advantage of a target’s not thinking carefully about the message. The process mirrors a phenomenon in animal behavior known as fixed action patterns (FAPs). These are sequences of behavior that occur in exactly the same fashion, in exactly the same order, every time they’re elicited. Cialdini (2008) compares it to a prerecorded tape that is turned on and, once it is, always plays to its finish. He describes it is as if the animal were turning on a tape recorder (Cialdini, 2008). There is the feeding tape, the territorial tape, the migration tape, the nesting tape, the aggressive tape—each sequence ready to be played when a situation calls for it.
In humans fixed action patterns include many of the activities we engage in while mentally on "auto-pilot." These behaviors are so automatic that it is very difficult to control them. If you ever feed a baby, for instance, nearly everyone mimics each bite the baby takes by opening and closing their own mouth! If two people near you look up and point you will automatically look up yourself. We also operate in a reflexive, non-thinking way when we make many decisions. We are more likely, for example, to be less critical about medical advice dispensed from a doctor than from a friend who read an interesting article on the topic in a popular magazine.
A notable characteristic of fixed action patterns is how they are activated. At first glance, it appears the animal is responding to the overall situation. For example, the maternal tape appears to be set off when a mother sees her hungry baby, or the aggressive tape seems to be activated when an enemy invades the animal’s territory. It turns out, however, that the on/off switch may actually be controlled by a specific, minute detail of the situation—maybe a sound or shape or patch of color. These are the hot buttons of the biological world—what Cialdini refers to as “trigger features” and biologists call “releasers.
Cupcakes and cookies arranged on a table for sale.
Humans are not so different. Take the example of a study conducted on various ways to promote a campus bake sale for charity (Levine, 2003). Simply displaying the cookies and other treats to passersby did not generate many sales (only 2 out of 30 potential customers made a purchase). In an alternate condition, however, when potential customers were asked to "buy a cookie for a good cause" the number rose to 12 out of 30. It seems that the phrase "a good cause" triggered a willingness to act. In fact, when the phrase "a good cause" was paired with a locally-recognized charity (known for its food-for-the-homeless program) the numbers held steady at 14 out of 30. When a fictional good cause was used instead (the make believe "Levine House") still 11 out of 30 potential customers made purchases and not one asked about the purpose or nature of the cause. The phrase "for a good cause" was an influential enough hot button that the exact cause didn´t seem to matter.
The effectiveness of peripheral persuasion relies on our frequent reliance on these sorts of fixed action patterns and trigger features. These mindless, rules-of-thumb are generally effective shortcuts for coping with the overload of information we all must confront. They serve as heuristics—mental shortcuts-- that enable us to make decisions and solve problems quickly and efficiently. They also, however, make us vulnerable to uninvited exploitation through the peripheral route of persuasion.
The Source of Persuasion: The Triad of Trustworthiness
Effective persuasion requires trusting the source of the communication. Studies have identified three characteristics that lead to trust: perceived authority, honesty, and likability.
When the source appears to have any or all of these characteristics, people not only are more willing to agree to their request but are willing to do so without carefully considering the facts. We assume we are on safe ground and are happy to shortcut the tedious process of informed decision making. As a result, we are more susceptible to messages and requests, no matter their particular content or how peripheral they may be.
Advertising is communication intended to inform, educate, persuade, and remind individuals of your product or businesses. Advertising must work with other marketing tools and business elements to be successful. Advertising must be interruptive — that is, it must make you stop thumbing through the newspaper or thinking about your day long enough to read or hear the ad. Advertising must also be credible, unique, and memorable in order to work. Like all effective marketing support, it must be built upon a solid positioning strategy. Finally, for any advertising campaign, enough money must be spent to provide a media schedule for ad frequency, the most important element for ad memorability.
Word-of-mouth advertising has existed as long as mankind has communicated and traded goods and services. Word-of-mouth advertising is considered the most effective form. It has the desired qualities of strong credibility, high audience attention levels, and friendly audience reception. It features open-ended conversation with questions and answers about the product, psychological incentives to purchase, memorability, efficiency and frequency. Word-of-mouth advertising passes product information to many other potential buyers (and may even include promotional trial demonstrations and free sampling), at little or no cost to the business. Whenever possible, a small business should build an advertising program that results in word-of-mouth advertising. Satisfied customers are your best advertisements.
In some respects, typical media advertising (e.g., the Miller Lite "less filling/more taste" ads) acts only as a catalyst to achieve word-of-mouth advertising and increased sales. Successful advertising will achieve many times more ad mentions through word-of-mouth than the number of paid media presentations of the ads.
Guidelines for Successful Advertising Campaigns
Here are some guidelines for creating memorable advertising that really sells:
Make sure your ads are "on strategy" with your business positioning. A good positioning strategy ensures identification of the correct target audience for your advertising, along with a listing of meaningful features and benefits. It can provide reasons why the product is superior and unique, along with an advertising "personality."
Communicate a simple, single message. People have trouble remembering someone´s name, let alone a complicated ad message. Use the "KISS" principle for ad messages: "Keep It Simple, Stupid." For print ads, the simpler the headline, the better. And every other ad element should support the headline message, whether that message is "price," "selection," "quality," or any other single-minded concept.
Stick with a likable style. Ads have personality and style. The Pillsbury Doughboy becomes a beloved icon; the Quiznos "sponge monkeys" nearly sunk the brand. Find a likable style and personality and stay with it for at least a year or more of ads. Changing ad styles and personality too often will confuse potential buyers. It also fights against memorability.
Be credible. If you say your quality or value is the "best" and it is clearly not, advertising will speed your demise, not increase your business. Identifying and denigrating the competition should also be avoided. It is potentially confusing and distracting and may back fire on you by making buyers more loyal to competitive products, not less.
Ask for the sale. Invite buyers to come to your store, send for more information, or call for information and orders in the ad. Provide easily visible information in the ad for potential customers to buy: location, telephone number, store hours, charge cards accepted, etc.
Make sure the ad is competitive. Do your homework. Examine competitive ads in the media that you are planning to advertise in. Make sure your ad stands out from competitive ads. You can use personal judgment, ad test exposures to a small group of target buyers (i.e., qualitative research), or more expensive, sophisticated quantitative test methods. Compare ads for uniqueness, memorability, credibility, and incentive to purchase.
Make sure the ad looks professional. If you have the time and talent, computer graphics and desktop publishing software can provide professional-looking templates to create good-looking print ads. Consider obtaining writing, artistic, and graphics help from local agencies or art studios who have experienced professionals on staff, with expensive and creative computer software in-house. They may save you time and money in the long run, with better results. Electronic ads (e.g., TV, radio, Internet) and outdoor ads are best left to professionals to write, produce, and buy for a fee or percentage of media dollars spent (i.e., generally 15 percent of gross media spending).
Be truthful. Whatever advertising medium you select, make sure your message is ethical and truthful. There are stringent laws regarding deceptive practices and false advertising.
- ‘Consumer behavior as a field of study examines both direct and indirect influences on consumption decisions’. Discuss. Also, highlight the importance of understanding consumer behaviour for developing marketing strategies.
Consumer behaviour is the study of individuals, groups, or organizations and the processes they use to select, secure, use, and dispose of products, services, experiences, or ideas to satisfy their needs and wants. It is also concerned with the social and economic impacts that purchasing and consumption behaviour has on both the consumer and wider society. Consumer behaviour blends elements from psychology, sociology, social anthropology, marketing and economics, especially behavioural economics. It examines how emotions, attitudes and preferences affect buying behaviour. Characteristics of individual consumers such as demographics, personality lifestyles and behavioural variables such as usage rates, usage occasion, loyalty, brand advocacy, willingness to provide referrals, in an attempt to understand people´s wants and consumption are all investigated in formal studies of consumer behaviour. The study of consumer behaviour also investigates the influences, on the consumer, from groups such as family, friends, sports, reference groups, and society in general.
The study of consumer behaviour is concerned with all aspects of purchasing behaviour - from pre-purchase activities through to post-purchase consumption and evaluation activities. It is also concerned with all persons involved, either directly or indirectly, in purchasing decisions and consumption activities including brand-influencers and opinion leaders. Research has shown that consumer behaviour is difficult to predict, even for experts in the field. However, new research methods such as ethnography and consumer neuroscience are shedding new light on how consumers make decisions.
Customer relationship management (CRM) databases have become an asset for the analysis of customer behaviour. The voluminous data produced by these databases enables detailed examination of behavioural factors that contribute to customer re-purchase intentions, consumer retention, loyalty and other behavioural intentions such as the willingness to provide positive referrals, become brand advocates or engage in customer citizenship activities. Databases also assist in market segmentation, especially behavioural segmentation such as developing loyalty segments, which can be used to develop tightly targeted, customized marketing strategies on a one-to-one basis.
Understanding purchasing and consumption behaviour is a key challenge for marketers. Consumer behaviour, in its broadest sense, is concerned with understanding both how purchase decisions are made and how products or services are consumed or experienced.
Some purchase decisions involve long, detailed processes that include extensive information search to select between competing alternatives. Other purchase decisions, such as impulse buys, are made almost instanteously with little or no investment of time or effort in information search.
Some purchase decisions are made by groups (such as families, households or businesses) while others are made by individuals. When a purchase decision is made by a small group, such as a household, different members of the group may become involved at different stages of the decision process and may perform different roles. For example, one person may search for information while another may physically go to the store, buy the product and transport it home. It is customary to think about the types of decision roles; such as:
In a family unit, the adult female often makes brand choices on behalf the entire household, while children can be important influencers
The Initiator the person who proposes a brand (or product) for consideration (something in return);
The Influencer someone who recommends a given brand;
The Decider the person who makes the ultimate purchase decision;
The Purchaser the one who orders or physically buys it;
The User the person who uses or consumes the product.
For most purchase decisions, each of the decision roles must be performed, but not always by the same individual. For example, in the case of family making a decision about a dining-out venue, the mother may initiate the process by intimating that she is too tired to cook, the children are important influencers in the overall purchase decision, but both parents may act as joint deciders performing a gate-keeping role by vetoing unacceptable alternatives and encouraging more acceptable alternatives. The importance of children as influencers in a wide range of purchase contexts should never be underestimated and the phenomenon is known as pester power.
The purchasing decision model
To understand the mental processes used in purchasing decisions, some authors employ the concept of the "black box"; a figurative term used to describe the cognitive and affective processes used by a consumer during a purchase decision. The decision model situates the black box in a broader environment which shows the interaction of external and internal stimuli (e.g.consumer characteristics, situational factors, marketing influences and environmental factors) as well as consumer responses. The black box model is related to the black box theory of behaviourism, where the focus extends beyond processes occurring inside the consumer, and also includes the relation between the stimuli and the consumer´s response.
The decision model assumes that purchase decisions do not occur in a vacuum. Rather they occur in real time and are affected by other stimuli, including external environmental stimuli and the consumer´s momentary situation. The elements of the model include: interpersonal stimuli (between people) or intrapersonal stimuli (within people), environmental stimuli and marketing stimuli. Marketing stimuli include actions planned and carried out by companies, whereas environmental stimuli include actions or events occurring in the wider operating environment and include social factors, economic, political and cultural dimensions. In addition, the buyer´s black box includes buyer characteristics and the decision process, which influence the buyer´s responses.
The purchase of up-market perfumes, often bought as gifts, are high involvement decisions because the gift symbolises the relationship between the giver and the intended recipient
The black box model considers the buyer´s response as a result of a conscious, rational decision process, in which it is assumed that the buyer has recognized a problem, and seeks to solve it through a commercial purchase. In practice some purchase decisions, such as those made routinely or habitually, are not driven by a strong sense of problem-solving. Such decisions are termed low-involvement and are characterized by relatively low levels of information search/ evaluation activities. In contrast, high involvement decisions require a serious investment of time and effort in the search/ evaluation process. Low involvement products are typically those that carry low levels of economic or psycho-social risk. High involvement products are those that carry higher levels of risk and are often expensive, infrequent purchases. Regardless of whether the consumer faces a high or low involvement purchase, he or she needs to work through a number of distinct stages of a decision process.
Overview of the consumer´s purchase decision process
The consumer buying process is usually depicted as consisting of 5 distinct stages:
The purchase decision begins with the problem recognition stage which occurs when the consumer identifies a need, typically defined as the difference between the consumer´s current state and their desired state. The strength of the need drives the entire decision process. Information search describes the phase where consumers scan both their internal memory and external sources for information about products or brands that will potentially satisfy their need. The aim of the information search is to identify a list of options that represent realistic purchase options. Throughout the entire process, the consumer engages in a series of mental evaluations of alternatives, searching for the best value. Towards the end of the evaluation stage, consumers form a purchase intention, which may or may not translate into an actual product purchase. Even when consumers decide to proceed with an actual purchase, the decision-process is not complete until the consumer consumes or experiences the product and engages in a final post purchase evaluation; a stage in which the purchaser´s actual experience of the product is compared with the expectations formed during the information search and evaluation stages. The stages of the decision process normally occur in a fixed sequence. However it should be noted that information search and evaluation can occur throughout the entire decision process, including post-purchase.
Marketing strategies impact the daily lives of the consumer significantly:
They act as the source of information for new products/ services available in the market.
It influences the way they think and perceive, their beliefs, thoughts, attitudes and their buying decisions.
On an average, a consumer is exposed to several promotional tactics every day. The television alone accounts for 6 hours of commercial advertisements every week (Lamb et al). In addition to the television, consumers also gain information from other forms of mass media like magazines, newspapers, radio, etc.
Impact of promotions on consumer behavior
Such advertisements have a mass impact as consumers change the way they purchase products, the politicians they root for in polls, their medicinal options, the toys they gift their children, etc. Although it is extremely difficult to change the beliefs, attitudes and character embedded deep in the roots of the person, most of the times marketing makes it a simpler task. Promotional activities are mostly successful in changing negative approaches to positive. For instance, if a consumer is loyal to a particular brand, advertisements may change their frequency of purchase. Marketing strategies affect the way a consumer ranks most important aspects of a brand like color, quality, taste, smell, texture, etc.
The impact of marketing strategies on consumer behavior is explained by Gort and Klepper (1982) as a process life cycle consisting of four stages:
Introduction: Here, the organization informs consumers about the new product. In this stage, the sales of a product increase.
Growth: here, the product has gained a level of stability in the market. The well-established hold pushes its sales further.
Maturity: On reaching maturity, the product reaches its optimum level of sales i.e. sales remain the same.
Decline: Finally, the product sales start to decrease in this stage as a result of competition, substitute products, etc.
Preparing a marketing strategy
The first step a company ideally adopts as a part of its marketing strategy is to inform the consumer about the product. This impacts the product sales as there is increased product awareness. Companies also invest most in the pre-launch stage of a product’s marketing plan. Here, we can identify with two primary effects of promotion and marketing on consumer preference: the impact on choice set and consumer utility quotient (Dixit & Norman, 1978; Grossman & Shapiro, 1984).
Hawkins (1986) rightly states that understanding consumer behavior is the initiation of the creation of an accurate marketing strategy. A product’s success/ failure is the evaluation of consumer responses to a particular marketing strategy. It also indicates if the organisation has been successful in fulfilling their wants and needs and their impact on the society. This can be represented as under
Marketing Strategy & its impact on Consumer Behavior (Source: Hawkins (2006); “Consumer Behavior”)
Marketing strategy & its impact on consumer behavior (Source: Hawkins (2006); “Consumer Behavior”)
The marketing strategies of many organizations can be modified by simply understanding issues such as
The psychologies of how consumers think, feel, reason, and select between different options of brands and products.
The psychology of how the consumer is influenced by his or her environment which include the culture, media to which the individual is exposed, family etc.
The behavior of consumers while shopping or making other marketing decisions.
Restrictions in consumer knowledge or information processing abilities have the ability to influence decisions and therefore the marketing result.
How consumers’ motivation and decision policies change with different products that differ in their level of importance or interest that they hold for the consumer.
How marketers can adapt to these psychologies and improve their marketing campaigns and marketing strategies which may create more impact in the minds of the consumer.
- Write a short note on opinion leaders. Explain the impact opinion leaders create in success of a product category.
Opinion leadership is leadership by an active media user who interprets the meaning of media messages or content for lower-end media users. Typically the opinion leader is held in high esteem by those who accept his or her opinions. Opinion leadership comes from the theory of two-step flow of communication propounded by Paul Lazarsfeld and Elihu Katz. Significant developers of the theory have been Robert K. Merton, C. Wright Mills and Bernard Berelson. This theory is one of several models that try to explain the diffusion of innovations, ideas, or commercial products.
Merton distinguishes two types of opinion leadership: monomorphic and polymorphic. Typically, opinion leadership is viewed as a monomorphic, domain-specific measure of individual differences, that is, a person that is an opinion leader in one field may be a follower in another field. An example of a monomorphic opinion leader in the field of computer technology, might be a neighborhood computer service technician. The technician has access to far more information on this topic than the average consumer and has the requisite background to understand the information, though the same person might be a follower at another field (for example sports) and ask others for advice. In contrast, polymorphic opinion leaders are able to influence others in a broad range of domains. Variants of polymorphic opinion leadership include market mavenism, personality strength and generalized opinion leadership. So far, there is little consensus as to the degree these concept operationalize the same or simply related constructs.
In his article "The Two Step Flow of Communication" by Elihu Katz, he found opinion leaders to have more influence on people´s opinions, actions, and behaviors than the media. Opinion leaders are seen to have more influence than the media for a number of reasons. Opinion leaders are seen as trustworthy and non-purposive. People do not feel they are being tricked into thinking a certain way about something from someone they know. However, the media can be seen as forcing a concept on the public and therefore less influential. While the media can act as a reinforcing agent, opinion leaders have a more changing or determining role in an individual´s opinion or action.
Factors for leadership In his article, Elihu Katz answers the question, "Who is an opinion leader?" One or more of these factors make noteworthy opinion leaders:
- expression of values
- professional competence
- Nature of their social network.
Opinion leaders are individuals who obtain more media coverage than others and are especially educated on a certain issue. They seek the acceptance of others and are especially motivated to enhance their social status. In the jargon of public relations, they are called thought leaders.
In a strategic attempt to engage the public in environmental issues and his nonprofit, The Climate Project, Al Gore used the concept of opinion leaders. Gore found opinion leaders by recruiting individuals who were educated on environmental issues and saw themselves as influential in their community and amongst their friends and family. From there, he trained the opinion leaders on the information he wanted them to spread and enabled them to influence their communities. By using opinion leaders, Gore was able to educate and influence many Americans to take notice of climate change and change their actions.
Many studies have shown that opinion leadership is in many markets the single strongest factor causing a purchasing decision, e.g. Bansal and Voyer, 2000; Kohli, 1989; Webster, 1988. However, it has actually not received adequate attention in previous literature. In particular, there has been surprising little research conducted that has examined the effect of social influences on the receiver’s purchase decisions across cultures. The importance of social influences has been exemplified in a classic consumer behaviour theory, Theory of Reasoned Action by Ajzen and Fishbein (1980), which specifies that individuals’ behavioural intentions are predicated by their own internal attitudes and their motivation to comply with others. Firms and marketers acknowledge that successful marketing of new/existing products or services depend on the impacts that the important others have on their potential customers. The focus of this study therefore rests on an assumption that some customers’ adoptions and opinions have a disproportionate influence on others’ adoptions. Previous literature has shown that interpersonal influence arising from opinion exchange behaviour is an important factor in consumers’ product adoption in Western societies (e.g. Bansal and Voyer, 2000; Gilly et al., 1998; Reagans, 2005; von Wangenheim and Bayon, 2003). As such, it is of managerial significance to discover similar trend in an international arena and whether the influence on purchase decisions depends on cultural background.
Research paper: The Impacts of Opinion Leaders towards Purchase Decision Engineering under Different Types of Product Involvement. Available from:
Culture Clark (1999) notes a high level of agreement amongst social scientists on two dimensions of national character reflecting: firstly, relation to self, secondly, relation to authority. These frameworks have been found in Hofstede’s collectivism-individualism and power distance. Hofstede (1980) identifies individualism-collectivism as a reflection of self-orientation, and power distance as a reflection of authority orientation. Using this framework as basis for investigating cultural variation in information use might allow decision to purchase to be attributed to cultural factors which would enrich our understanding of the results.
- Collectivism–Individualism Lee and Green (1991), aiming to validate Fishbein’s behavioural intention theory for application outside of the United States, found that subjective norms are more important to Korean samples (collectivists) than American samples (individualists). Their study provides an insightful ground for our study that the interpersonal forces have varying influence subject to differences in collectivism–individualism. Lee and Green also provided ground for Kongsompong et al. (2009) to use the same purchase scenario on student respondents in Australia, Singapore, Thailand, and USA to test social influence. Kongsompong et al. (2009) found that collectivists are more susceptible to social influence in buying situations than individualists. Their finding is consistent with collectivists’ trait of prioritising group harmony and avoiding conflicts. However, it must be noted that the final construct or the eventual findings are different to this study. Both studies aimed to measure behavioural intentions, which is a different construct to this study’s aim to measure purchase decisions with actual prior purchase. As such, this research aims to further add to the body of knowledge in purchase decisions with comparative study in Thailand (collectivist society) and USA (individualist society) investigating into different types of product involvement.
- Power Distance Prior studies indicate that individuals with higher power distance perception would tend to perceive the views of higher status individuals to be superior to their own (Tung and Quaddus, 2002). Thus acceptance of unequal power distribution implies the acceptance of substituting the decision of an individual for the decisions of an authority (Wong and Birnbaum-More, 1994). In other words, the higher the power distance value one holds, the stronger will be the referents’ influence on the individual, which indicates a greater role of subjective norm in one’s perception of purchase decision. However, none of these studies aim to measure the influence of opinion leaders towards the purchase decisions of the opinion seekers. In relation to this study, it was found that Americans have higher degree of equality hence small power distance as can be seen by McGregor’s Theory x and Theory y, which emphasises employees’ participation with the managers’ decisions to become a Theory y person. In addition, Maslow’s concept of self-actualisation also stresses self as a target end value. These famous American theorists reflect American culture. On contrary, Komin (1990) found that Thais are more tolerant to the unequal distribution of power and wealth. 2.2Product Involvement According to Park and Mittal (1985), motivational component of involvement indicates the 14 Pongsiri Tejavibulyaa and Somkiat Eiamkanchanalai / Systems Engineering Procedia 2 (2011) 12 – 22 Pongsiri Tejavibulya and Somkiat Eiamkanchanalai/ Systems Engineering Procedia 00 (2011) 000–000 cognitive/affective involvement. They indicated that information processing under cognitive differs from that under affective involvement. Cognitive involvement refers to the level of consumers’ informational processing activities, while affective involvement refers to the degree of a consumer’s emotional states evoked by an object, such as a product (Kim and Sung, 2009). Studies indicate that purchase decisions are based on considerations of both cognitive and affective product features. For instance, a consumer may be initiated first by cognitive involvement with an iPad’s features and functions, and/ or affectively involved with the sleek design of an iPad, or both. Previous literature has mostly averaged the cognitive and affective items together. For example, Kapferer and Laurent (1985) measured affective involvement within the construct of cognitive involvement by including emotional-related measurement items such as pleasure and excitement. Park and Mittal (1985)’s framework and the Foote, Cone, and Belding’s FCB Grid are some attempts to explain the involvement construct in terms of both cognitive and affective reactions to stimuli. Although the idea of classifying cognitive and affective purchase-decision involvement appears to be reasonable, it was not until Kim and Sung (2009) who confirmed that cognitive purchase-decision involvement is a different construct from affective purchase-decision involvement.
- Homophily Homophily is defined as “the degree to which pairs of individuals who interact are similar in terms of certain attributes, such as age, sex, beliefs, education, social status, and the like” (Rogers, 2003). Overall, the current empirical evidence suggests that homophilous sources of information will be perceived as more credible than heterophilous ones, which should result in greater influence (Brown and Reingen, 1987). As Price and Feick (1984) suggested, this is because of perceived ease of communication. Also homophilous individuals are more likely to have similar product needs and wants. Researchers who seem to agree that product-category involvement may play a part in this are Gilly et al. (1998). They suggested that demographic and perceptual homophily can affect word-of-mouth influence processes in different ways, and their effect varies depending on the product category. Perceptual homophily appears to have enhanced word-of-mouth influence on all product types. However, demographic differences appear to have impact only when the product category is consumer durables.
- Tie Strength Granovetter (1973) defined tie strength as “the strength of a tie is a (probably linear) combination of the amount of time, the emotional intensity, the intimacy (mutual confiding), and the reciprocal services which characterise the tie”. Brown and Reingen (1987) argued that when a strong tie exists between the sender and the receiver, the two are probably more familiar with each other than those who are in a weak tie condition, this results in a more easily facilitated search and hence an active search for word-of-mouth information. Therefore they suggested that strong ties bear greater influence on the receiver’s behaviour than weaker ties. This notion is further supported in the work of Frenzen and Nakamoto (1993). Bansal and Voyer (2000) also found support. Sweeney et al. (2007) concluded that word-of-mouth was more effective when there was a close relationship and a good rapport between the sender and the receiver. They point out that what is important is that the sender’s opinion must be viewed with respect by the receiver.
- Opinion Leader’s Expertise Consumers are more inclined to seek the advice from, and be influenced by, expert sources than by non-expert ones (Bansal & Voyer, 2000). This is because expertise reduces perceived risk during the evaluation stage of a purchase. In other words, an expert’s message would have a significant impact on the seeker’s purchase decision. Fitzgerald Bone (1995), Gilly et al. (1998), Wangenheim and Bayon (2004), and Sweeney et al. (2007) investigated the importance of opinion leader’s expertise and opinion leadership on the influence of a sender’s word-of-mouth on an opinion seeker. Their studies supported the impact of source expertise and opinion leadership on the effectiveness of word-of-mouth. In conclusion, behavioural influences are more pronounced when the credibility of the source is high than when it is low. 15Pongsiri Tejavibulyaa and Somkiat Eiamkanchanalai / Systems Engineering Procedia 2 (2011) 12 – 22 Pongsiri Tejavibulya and Somkiat Eiamkanchanalai/ Systems Engineering Procedia 00 (2011) 000–000 Robertson (1971) argued that products high in complexity and perceived risk and low in testability are more prone to personal influences than those low in complexity and perceived risk but high in testability. On the other hand, in the absence of such complexity, seekers will not need to use the source´s expert opinion as a helping hand for their own judgment.
- Opinion Seeker’s Expertise A number of empirical evidence supports a negative relationship between expertise and total external search for information (Gilly, et al. 1998). Bloch et al. (1986) found that product enthusiasts, assumed to be high in product expertise, conducted relatively little external search before making a purchase. This is due to large store of knowledge. These product experts would feel confident in their ability to make any individual product choice and would feel little need to consult others prior to product selection. On the contrary, consumers with less product knowledge and experience are more likely to doubt their own ability to make good product choices and therefore are likely to feel compelled to ask others for product advice (Furse et al., 1984). Contrary to the expected contention, however, previous research on the influence of opinion seeker’s expertise has not all been conclusive (Fitzgerald Bone, 1995; Gilly et al., 1998; Bansal and Voyer, 2000; Sweeney et al., 2007). For example, Gilly et al. (1998) found that opinion seeker’s expertise appeared to have a direct negative impact on opinion seeker’s influence on purchase decision of durable goods, but not on non-durable goods. Further investigation should be performed on product-category involvement as it appears that product-category involvement may play a part in this.
- What is cog native learning theory? Explain the concept with the help of relevant examples.
The Cognitive Learning Theory explains why the brain is the most incredible network of information processing and interpretation in the body as we learn things. This theory can be divided into two specific theories: the Social Cognitive Theory (SCT), and the Cognitive Behavioral Theory (CBT).
When we say the word “learning”, we usually mean “to think using the brain”. This basic concept of learning is the main viewpoint in the Cognitive Learning Theory (CLT). The theory has been used to explain mental processes as they are influenced by both intrinsic and extrinsic factors, which eventually bring about learning in an individual.
When you study “cognitive learning” you are studying the process the brain takes to learn. You are trying to figure out how the brain perceives its environment, develops problem-solving skills, and stores memories. These processes can happen both subconsciously and consciously and gaining insight into them will hopefully help us improve our learning on the conscious side of things.
So, for instance, some students learn better by watching, others by listening, others by writing, and others by doing. Knowing this, and identifying which students are which, a good teacher will take these approaches into account and more efficiently transmit knowledge to the students.
Cognitive Learning Theory (CLT) covers two specific theories: Social Cognitive Theory (SCT) and Cognitive Behavioral Theory (CBT). SCT focuses on behavioral, environmental (extrinsic) and personal (intrinsic) factors. CBT focuses on the individual’s perception of three things: the self, the environment, and the future. Obviously SCT will help the teacher create an environment that is conducive to learning. CBT is more the realm of the counselor who helps the client reformulate ideas about themselves and their situation so that they can function well regardless of their environment.
Attention - Sometimes our cognitive processing systems get overloaded and we have to select information to process further. This deals with how and why performance improves with attention.
Formation of concepts - This aspect studies human’s ability to organize experiences into categories. Response to stimulus is determined by the relevant category and the knowledge associated with that particular category.
Judgment and decision - This is the study of decision making. Any behavior, implicit or explicit, requires judgment and then a decision or choice.
Language processing - This is the study of how language is acquired, comprehended and produced. It also focuses on the psychology of reading. This includes processing words, sentences, concepts, inferences and semantic assumptions.
Learning - This is the study of new cognitive or conceptual information that is taken in and how that process occurs. It includes implicit learning that takes into account previous experience on performance.
Memory - Studying human memory is a large part of cognitive psychology. It covers the process of acquiring, storing and retrieving memory, including facts, skills and capacity.
Perception - This includes the senses and the processing of what we sense. This also includes what we sense and how it interacts with what we already know.
Problem solving - Solving problems is a way that humans achieve goals.
Achieving goals - Moving to a goal can include different kinds of reasoning, perception, memory, attention and other brain functions.
Reasoning - This is the process of formulating logical arguments. It involves making deductions and inferences and why some people value certain deductions over others. This can be affected by educated intuitive guesses, fallacies or stereotypes.
Areas of Application in Cognitive Psychology
Moral development - This includes how moral dilemmas change your moral reasoning in the stages of moral development.
Eyewitness testimony - Study of how a witness’s testimony is affected by stress, focusing on a weapon, or leading questions.
Forgetting - This area covers long and short term memory.
Selective attention - Humans have limited capacity for paying attention so this studies the selection of what deserves our attention.
Perception - This covers the processing of sensual inputs and how the brain turns them into sensual perceptions.
Child development - This deals with the process of cognitive processes as we grow.
Cognitive behavioral therapy - This uses the fact that thought patterns can affect behavior and tries to help people with mental health problems.
Learning styles - This investigates the different ways in which people learn.
Information processing - Compares humans to computers in the way we process information.
Cognitive interview - This is way of asking questions that help an eye witness remember better.
Education - Cognitive psychology can help with more effective learning techniques.
Face Recognition - An example of this is the fact that we still recognize a friend’s face even if one aspect of it changes, like a hair cut.
- How would reference group impact the sale of a perticular brand? Explain the impact celibrities create on sale of a brand.
Hyman (1942) introduced the term ‘reference group’, as “a person or a group of persons which significantly influences an individual’s behavior”. In other words, it is a group whose accepted perspectives or values are being used by an individual as the basis of his or her behavior. It provides standards (norms) and values that can become the determining viewpoint for the mode of thoughts and actions of those who are thus influenced. A reference group is defined as “an actual or imaginary individual or group conceived of having significant relevance upon an individual’s evaluations, aspirations, or behavior” (Park & Lessig, 1977). Reference groups are usually conformed by the social network of an individual: family members, friends and colleagues, and inspirational figures (Bachmann, John & Rao, 1993). Given that social networks are conformed in different manners in different cultural contexts, reference group influenc varies across cultures (Childers & Rao, 1992). Reference groups have basically two functions (Kelley, 1965): A normative function that sets and enforces standards for the individual, and a comparative function that serves as a comparison point against which an individual evaluates himself and others (Cocanougher & Bruce, 1971).
Marketing and consumer behavior scholars have shown that reference groups influence consumer choice, especially for branded products such as candy (Ratner & Kahn, 2002), clothing (Batra, Homer & Kahle, 2001), snack foods (Ratneshwar & Shocker, 1991), mineral water and sodas (Van Trijp, 1994), fragrances (Chow, Celsi & Abel, 1990), and wine (Quester & Smart, 1998). Bearden & Etzel (1982) attributed a significant part of this variation in choice to individual differences in consumer susceptibility to normative influence. In a study of wine brand choice, Orth & Kahle (2008) have found individuals higher on internal values and with more complex social identities were less susceptible to normative influence and placed less emphasis on social brand benefits. They have also shown that reference group salience interacts with personal values and social identity complexity in affecting consumer susceptibility to normative influence, which in turn affects consumer brand choice. Clark & Goldsmith (2006) examined the effects of innovativeness and attention to social comparison information on normative and informational dimensions and found that innovativeness is associated with susceptibility to informational influence despite a resistance to normative influence.
In simple words a reference group is any person or group that serves as a point of comparison (for reference) for an individual in forming either general or specific values, attitudes, or behavior (Schiffman & Kanuk, 2000). From the consumer behavior perspective, reference groups serve as frames of reference for individuals in their purchase or consumption decisions (Schiffman & Kanuk, 2000). Promotional strategies adopted by the marketers in using celebrities and the subtle use of group influence in their advertisements, clearly indicates the growing awareness on the part of marketing and advertising practitioners regarding the influence of reference groups in purchase decisions (Khan, 1988). For example, by using reference groups in their advertisements, Blackberry Mobile Systems17 are communicating the message that they are meant not only for the business executives but also for all those who are actively into mobile messaging, net surfing, film making, fashion designing, etc.
Reference Groups Classification
Reference groups can be classified in terms of a person’s membership or degree of involvement bwith the group, as well as in terms of the positive or negative influences they have on his or her values, attitudes, and behavior (Schiffman & Kanuk, 2000):
- A contactual group is one in which a person holds membership or has regular face-to-face contact and of whose values, attitudes, and standards he or she approves. Thus, a contactual group is likely to have a congruent influence on an individual’s attitudes or behavior.
- An aspirational group is one in which a person does not hold membership and does not have face-to-face contact but wants or aspires to be a member of the group. Thus, it often serves as positive influence on that person’s attitudes or behavior.
- A disclaimant group is one in which a person holds membership or has face-to-face contact but disapproves of the group’s values, attitudes or behaviors. Thus, the person tends to adopt attitudes and behavior that are in opposition to the norms of the group.
- An avoidance group is one in which a person does not hold membership and does not have face-to-face contact and whose values, attitudes, and behaviors he or she dislikes. Thus, the person tends to adopt attitudes and behavior that are in opposition to those of the group.
Cocanougher & Bruce (1971) distinguish between socially proximal referents that operate in the individual’s immediate social network and socially distant referents that operate in the periphery of the individual’s social domain. Parents, teachers and peers are representative of normative referents who provide the individual with norms, attitudes and values through direct interaction.
Comparative referents, such as sports heroes and entertainment figures, provide standards of achievement to which individuals aspire and are relatively further removed from the individuals
(Childers & Rao, 1992).
Reference group can also be classified into primary and secondary groups depending on the degree of participation (Kotler, 2003):
- Primary Groups are characterized by face the face-to-face association and high degree of cooperation among members. They are basic in forming the social nature of the consumer, since it is within these groups that a person’s most direct and most frequent interaction with others takes place and thus, they tend to be informal. Primary groups to which the consumers are mostly exposed are the family, neighbors, friends and co-workers.
- Secondary Groups are those where people tend to be more formal and there is less continuous interaction unlike primary groups. These are characterized by a more conscious and deliberate choice by those making the group membership. These groups are referred to as special interest groups. Communication within primary groups usually reflects immediate feedback but secondary groups experience a greater delay in feedback.
Secondary groups to which the consumers are usually exposed to are religious organizations, professional associations, trade unions, etc.
Influence of Positive and Negative Reference Groups on Consumers
Past research (Park & Lessig, 1977; Bearden & Etzel, 1982; Childers & Rao, 1992) has largely focused on positive reference groups (i.e., those groups that individuals wish to be associated with), identifying the central role they can play in determining attitudes and behaviors (White &
Dahl, 2006). The pervasive use of spokespersons in product and service endorsements reflects the widely held belief that individuals who are admired or who belong t