Lecture 1: Introduction to Consumer Behaviour
Selling concept: Any product can be sold through aggressive and effective selling techniques
Marketing concept: Delivering the desired satisfaction more effectively & efficiently than competitors
• Marketing management: the process of planning and executing the conception, pricing,
promotion and distribution of ideas, goods, and services to create exchanges that satisfy
individual and organizational objectives: meeting customer needs profitably
Production concept: mass production & economies of scale
Marketing mix (4 p’s):
• Product: which benefits do I offer the consumer
• Price: at what cost
• Promotion: by what info / persuasion
• Place: at which place and time
Quality attributes can be delivered through:
• Intrinsic cues: product characteristics that are intrinsic to the product and cannot be
changed without altering the product (flavour and aroma cues for beer)
• Extrinsic cues: other marketing efforts (price and brand
name cues for beer)
Consumer behaviour: the study of the processes involved when
individuals / groups select, purchase, use or dispose of products,
services, ideas or experiences to satisfy their needs and desires.
Consumer decision making:
• Need recognition: utilitarian & hedonic motivations
o Hedonic consumption: food consumption as a goal on itself
o Utilitarian consumption: food consumption as an instrumental mean to achieve
some further goal
• Search behaviour: internal & external research
o Leads to perception about marketing stimuli / information
o Includes cognitive (knowledge) and affective factors (feelings/emotions)
o Interpretation IS NOT intention
• Evaluation of alternatives: alternatives are evaluated on a limited number of choice criteria
o Each of the criteria has a weight attached to it reflecting its importance
• Choice & Evaluation
o Purchase intention & unanticipated circumstances (out of stock)
▪ Satisfaction = reinforcement of choice
▪ Dissatisfaction = changes in the decision process
Elaboration Likelihood Model (ELM):
• High involvement situation: info is processed through central route
o Content of message is evaluated extensively
• Low involvement situations: info is processed through peripheral route
o Attitudes are formed on basis of simple cues in message / context
3 determinants of consumer behaviour: consumer, product & situation characteristics
,Lecture 2: Quality Perception
Why study perception?
• Consumers act on what they perceive not on what is reality
o Reality: scientific objectivity (product characteristics, based on facts)
o Perception: human subjectivity (consumer perception of the cues in the environment)
▪ Perception is the process by which stimuli from the environment are
selected, organized and interpreted.
▪ Perception involves (1) external stimuli, (2) sensory receptors, (3) mental
processes, and (4) reactions to stimuli
▪ Valid perception requires observational reliability. But observational
reliability is no guarantee for valid perception.
• Inter-observer reliability: between people
• Intra-observer reliability: over time
Brunswik’s Lens Model
• Ecological validity: cue predictive value - ambiguity
o Relationship between distal variable and
proximal cues
▪ What is → what can be observed
o Proximal cues are indicators of distal
phenomena (the object)
o Some proximal cues are ‘better’ indicators
than others (higher ecological validity)
o Cue ambiguity reduces ecological validity
▪ Cue ambiguity: search < experience < credence attributes
• Credence attributes are extremely ambiguous, so they need extrinsic
cues (You don’t know it’s Fair Trade without an label)
o Cues can be highly valid predictors, meaningless and ambiguous
• Cue utilisation: cue confidence value – combination of cues
o Relationship between proximal cues and perceptual response
▪ What can be observed → what is observed
o Pragmatic perception follows a probabilistic strategy (cues are imperfect)
▪ Making the most likely inference about the object
▪ Using some weighting according to assumed
cue validity
▪ Being flexible to update the inference to
changes
▪ Mostly ‘recognition-based’ selection of cue
o We use these cues to inferred ‘true state’
o The ‘hypothesised reality’ is tested against further cues
o What you perceive depends on the cues that are selected
• Functional validity
o Relationship between distal variable and perceptual response
▪ What is → what is observed
o To what degree does the perceptual response match the distal variable
, Steenkamp Paper (1990)
• Value based quality consists of:
o Evaluative judgement (1)
▪ Quality cues
• Can be determined prior to consumption
• Informational stimuli / search attributes
• Intrinsic: physical, inseparable part of the product (colour, size)
• Extrinsic: related, attached to the product (price, brand, label)
• Based on these cues: quality beliefs
▪ Quality attribute (taste)
• Cannot be determined prior to consumption
• Experience or credence attributes
• What the consumer wants to obtain
• Intrinsic: inherent to the product (organic production)
• Extrinsic: attached to the product (Fair Trade)
o On subject – object interaction (3)
▪ Comparative to other products (if other products are very good, this one is
perceived worse)
▪ Personal (differs among subjects)
▪ Situational (depends on context)
o In a consumption context (3)
▪ Fit to provide the desired consumption experience
• Anticipated fitness for consumption
• Formation of (quality) attribute beliefs can be based on:
o Descriptive belief formation
▪ Based on cues: search attributes, experience attributes
▪ Mostly trial and error based: few inferences
o Informational belief formation
▪ Classic communication & persuasion model
▪ Source / receiver / message effect (noise)
o Inferential belief formation
▪ Previous experiences
People use more informational & inferential belief formation. Based on experience &
credence quality cues & based on intrinsic & extrinsic quality cues
• Quality perception seen as a three step procedure
o Cue acquisition & categorisation
o (Inferential) attribute belief formation
o Integration of beliefs into overall quality judgement
Search attributes: can be determined before purchase (colour, weight, brand)
Experience attributes: can be discerned only after purchase (vacations, taste)
Credence attributes: hard to evaluate even after purchase & consumption (medical diagnosis, auto
repair)
Selling concept: Any product can be sold through aggressive and effective selling techniques
Marketing concept: Delivering the desired satisfaction more effectively & efficiently than competitors
• Marketing management: the process of planning and executing the conception, pricing,
promotion and distribution of ideas, goods, and services to create exchanges that satisfy
individual and organizational objectives: meeting customer needs profitably
Production concept: mass production & economies of scale
Marketing mix (4 p’s):
• Product: which benefits do I offer the consumer
• Price: at what cost
• Promotion: by what info / persuasion
• Place: at which place and time
Quality attributes can be delivered through:
• Intrinsic cues: product characteristics that are intrinsic to the product and cannot be
changed without altering the product (flavour and aroma cues for beer)
• Extrinsic cues: other marketing efforts (price and brand
name cues for beer)
Consumer behaviour: the study of the processes involved when
individuals / groups select, purchase, use or dispose of products,
services, ideas or experiences to satisfy their needs and desires.
Consumer decision making:
• Need recognition: utilitarian & hedonic motivations
o Hedonic consumption: food consumption as a goal on itself
o Utilitarian consumption: food consumption as an instrumental mean to achieve
some further goal
• Search behaviour: internal & external research
o Leads to perception about marketing stimuli / information
o Includes cognitive (knowledge) and affective factors (feelings/emotions)
o Interpretation IS NOT intention
• Evaluation of alternatives: alternatives are evaluated on a limited number of choice criteria
o Each of the criteria has a weight attached to it reflecting its importance
• Choice & Evaluation
o Purchase intention & unanticipated circumstances (out of stock)
▪ Satisfaction = reinforcement of choice
▪ Dissatisfaction = changes in the decision process
Elaboration Likelihood Model (ELM):
• High involvement situation: info is processed through central route
o Content of message is evaluated extensively
• Low involvement situations: info is processed through peripheral route
o Attitudes are formed on basis of simple cues in message / context
3 determinants of consumer behaviour: consumer, product & situation characteristics
,Lecture 2: Quality Perception
Why study perception?
• Consumers act on what they perceive not on what is reality
o Reality: scientific objectivity (product characteristics, based on facts)
o Perception: human subjectivity (consumer perception of the cues in the environment)
▪ Perception is the process by which stimuli from the environment are
selected, organized and interpreted.
▪ Perception involves (1) external stimuli, (2) sensory receptors, (3) mental
processes, and (4) reactions to stimuli
▪ Valid perception requires observational reliability. But observational
reliability is no guarantee for valid perception.
• Inter-observer reliability: between people
• Intra-observer reliability: over time
Brunswik’s Lens Model
• Ecological validity: cue predictive value - ambiguity
o Relationship between distal variable and
proximal cues
▪ What is → what can be observed
o Proximal cues are indicators of distal
phenomena (the object)
o Some proximal cues are ‘better’ indicators
than others (higher ecological validity)
o Cue ambiguity reduces ecological validity
▪ Cue ambiguity: search < experience < credence attributes
• Credence attributes are extremely ambiguous, so they need extrinsic
cues (You don’t know it’s Fair Trade without an label)
o Cues can be highly valid predictors, meaningless and ambiguous
• Cue utilisation: cue confidence value – combination of cues
o Relationship between proximal cues and perceptual response
▪ What can be observed → what is observed
o Pragmatic perception follows a probabilistic strategy (cues are imperfect)
▪ Making the most likely inference about the object
▪ Using some weighting according to assumed
cue validity
▪ Being flexible to update the inference to
changes
▪ Mostly ‘recognition-based’ selection of cue
o We use these cues to inferred ‘true state’
o The ‘hypothesised reality’ is tested against further cues
o What you perceive depends on the cues that are selected
• Functional validity
o Relationship between distal variable and perceptual response
▪ What is → what is observed
o To what degree does the perceptual response match the distal variable
, Steenkamp Paper (1990)
• Value based quality consists of:
o Evaluative judgement (1)
▪ Quality cues
• Can be determined prior to consumption
• Informational stimuli / search attributes
• Intrinsic: physical, inseparable part of the product (colour, size)
• Extrinsic: related, attached to the product (price, brand, label)
• Based on these cues: quality beliefs
▪ Quality attribute (taste)
• Cannot be determined prior to consumption
• Experience or credence attributes
• What the consumer wants to obtain
• Intrinsic: inherent to the product (organic production)
• Extrinsic: attached to the product (Fair Trade)
o On subject – object interaction (3)
▪ Comparative to other products (if other products are very good, this one is
perceived worse)
▪ Personal (differs among subjects)
▪ Situational (depends on context)
o In a consumption context (3)
▪ Fit to provide the desired consumption experience
• Anticipated fitness for consumption
• Formation of (quality) attribute beliefs can be based on:
o Descriptive belief formation
▪ Based on cues: search attributes, experience attributes
▪ Mostly trial and error based: few inferences
o Informational belief formation
▪ Classic communication & persuasion model
▪ Source / receiver / message effect (noise)
o Inferential belief formation
▪ Previous experiences
People use more informational & inferential belief formation. Based on experience &
credence quality cues & based on intrinsic & extrinsic quality cues
• Quality perception seen as a three step procedure
o Cue acquisition & categorisation
o (Inferential) attribute belief formation
o Integration of beliefs into overall quality judgement
Search attributes: can be determined before purchase (colour, weight, brand)
Experience attributes: can be discerned only after purchase (vacations, taste)
Credence attributes: hard to evaluate even after purchase & consumption (medical diagnosis, auto
repair)
