Sunday, February 24, 2013

Chapter-15: Problem Recognition



Chapter-15: Problem Recognition

Types of Consumer Decisions:
There are a myriad of decision options possible for the consumer in today’s market economy. These options, however, may be distilled into five main types of decisions:
(i) What to buy: Deciding what to buy is one of the consumer’s most basic tasks. No buying activity may take place unless this fundamental decision is made. A consumer’s product or service decision may encompass not only the generic category of products desired, such as appliances, but more specifically, the narrower range of items, such as kitchen appliances. Consumer must even make decision on brands, price, and product features.
(ii) How much to buy: A second basic decision by the consumer relates to how much of the item will be purchased. For example, when shopping for groceries the consumer must determine whether three litters of coke will be purchased or more.
(iii) Where to buy: The consumer needs to decide where the selected product or service will be purchased. This is very important decision, which interacts thoroughly with the previous decision on what to buy. Two products, although physically the same, are likely to perceived differently because of other facts associated with them. For example, consider an air conditioner sold with delivery, installation, and in-home servicing guaranteed by a full-service department store compared with the same model priced lower.
(iv) When to buy: The consumer must also determine when to buy. This decision is influenced by such factors as urgency of the need and availability of the chosen item. Other elements such as store opening times, periods of sales and clearances, availability of transportation, and freedom of family members to shop all the bearing on when one purchase.
(v) How to buy: The decision of how to buy is another complex issue. Many factors influence how the consumer buys. To indicate merely a few of the elements involved, consider some alternative strategies consumers use: shop extensively or buy for the first layout, pay cash or charge it, have it delivered or take it home.
Numerous purchasing patterns occur in the marketplace, with each consumer relying on whatever strategy seems to work well for himself. The problems that consumers must solve, however, could benefit from the cold logic of a computer rather than the hit or miss decision approach taken by some consumers.

Introduction to the Consumer Decision-Process Model:
Consumer decision processes vary considerably in their complexity. Most of the decisions consumers are required to make are probability rather simple ones such as the purchase of staple foods. However, consumers also must make decisions that are comparatively complicated, such as when buying durable goods. The range of difficulty of consumer decision processed extends even further to problem solving that may be characterized as being highly complex. The range of consumer problem solving approaches can be placed on a spectrum from routine problem solving, to limited problem solving, to extensive problem solving.
(i) Routine Problem Solving (RPS): When consumers buy a brand they have purchased before, it usually involves little or no information seeking and is performed quickly. Consumers are brand loyal and tend to buy in a habitual, automatic, and unthinking way.
(ii) Limited Problem Solving (LPS): When consumers buy a new brand in a familiar product category, it usually involves a moderate amount of information seeking and time in choosing.
(iii) Extensive Problem Solving (EPS): When consumers buy in an unfamiliar product category, it usually involves the need to obtain substantial information and a longer time to choose. They must form a concept of the new product category and determine the criteria to be used in choosing a brand.
However, it has been suggested from certain purchase situations some consumers do not engage in a pre-purchase decision process. For example, they may not have stored information, it may not be retrieved or retrievable, and they may not search externally.

Problem Recognition:
Problem recognition results when a consumer recognizes a difference of sufficient magnitude between what is perceived as the desired state of affairs and what is the actual state of affairs, enough to arouse and activate the decision process. The actual state refers to the way in which a need id already being met and the desired state is the way a person like for the need to be satisfied.
Consumers must become aware of the problem or need through processing of information arising internally or externally. They then become motivated. The process of problem recognition means that the consumer becomes aroused and activated to engage in some purposeful purchase-decision activity.

Types of Problem Recognition: Rather than viewing problem recognitions occurring in only one way, it is useful to understand that there may be varying types of problem–recognition processes. One approach has been to develop a classification system of situations based on the factors of immediacy or required solution and whether or not the problem was expected.
(i) Immediacy of problem solution is a relevant factor in determining the decision time horizon; that is, how soon a problem solution is needed, will affect the length of decision process and intensity of decision effort.
(ii) Expectancy of the problem can affect such facets as the sources of information used in the decision process, for example, as well as the number of alternative considered.
(iii) Routine problems are those in which the difference between actual and desired states is expected to occur and an immediate solution is required. Typically, convenience goods are associated with this type of problem-recognition, such as most grocery purchases are made by consumers.
 (iv) Emergency problems are those that are unexpected in which immediate solutions are necessary. For instance, a consumer who is involved in an automobile accident and totals his car may need a quick solution to his transportation problem.
(v) Planning problems occur when the problem occurrence is expected but an immediate solution is not necessary. For instance, a consumer who expects that his car will only last one additional year may begin to engage in window shopping for autos, have discussed with friends about various brands, and pay closer attention to automotive ads.
(vi) Evolving situations occur when the problem is unexpected but no immediate solution is required. The fashion-adoption ordinarily occurs over a lengthy period of time for many consumers.

Situations Leading to Problem Recognition: There are numerous situations that may cause consumer problem recognition to occur. Although discussion of all the potential sources is impossible, we can present the most significant reasons and explain briefly how each one might arise.
(i) Depleted or inadequate stock of goods: The consumer uses up the assortment of goods she has and must repurchase in order to re-supply her needs. As long as there still is a basic need for the item, problem recognition should result from its consumption. Sometimes the consumer’s stock of goods is inadequate for even her everyday needs and may require a purchase. For instance, she may want to install a bracket for hanging planter but finds that she doesn’t have t necessary tools such as ruler, a drill and screwdriver.
(ii) Discontentment with the stock of goods: Frequently, consumers become discontented with products they own, and this leads to problem recognition. For example, men’s ties and jacket lapels narrow and widen as fashion cycle progress. Consequently, men may feel their clothing is no longer stylish, and they may desire to update their wardrobes. Even though the old clothes might be perfectly serviceable, they may be an embarrassment to wear. As a result, this problem is resolved by purchasing some of the latest fashion.
(iii) Changing environmental circumstances: Consumers sometimes encounter changes in their environmental circumstances, which lead to problem recognition. One of the most significant of these situations in the family’s changing characteristics. Different lifecycle stages produces need for different products.
(iv) Changing financial circumstances: The financial status of the consumer has a very important relationship to problem recognition. The present or anticipated financial picture may trigger problem recognition as the consumer determines what purchases can be afforded.
(v) Marketing activities: The marketer frequently attempts to precipitate problem recognition thorough promotional efforts aimed at the consumer. With such efforts, the marketer seeks to have the consumer perceive a difference of sufficient magnitude between her desired state (ownership of the product) and her actual state (not owing it) to engage in search, evaluation, and purchasing activity for the marketer’s brand.

Results of Problem Recognition: Once the consumer becomes aware of a problem, two basic outcomes are possible. One result is for the consumer, in effect, not to pursue any further problem-solving behavior, which might occur if the difference between the consumer’s perceived desired and actual states is not great enough to cause him to act to resolve the difference. Another situation in which problem recognition may not lead to further stages of consumer decision making occurs when certain environmental elements preclude it.

Marketing Implications of Problem Recognition:
The significance to marketers of the problem-recognition stage of consumer decision-making is that the process can be effectively measured and can be used to develop and evaluate marketing strategies.
(i) Measuring problem recognition: Consumer researchers have found that the best way to assess the problem-recognition process is through scaling techniques, which measure purchase intentions. Purchase intentions incorporate the consumer’s attitudes toward the product and may be viewed as the mental forerunner of buying behavior.
(ii) Activating problem recognition: Promotion is an important vehicle used by marketers to cause problem recognition to occur among potential customers. Marketers often seek to influence consumer’s desired states such as in much of the advertising stressing benefits of product ownership. Consumer’s actual states often develop into situations that are routine, habitual, or unnoticed patterns of behavior. Many marketing activities, therefore, are designed based on the assumptions that buying occurs shortly before actual consumption.
(iii) Utilizing problem recognition information: The marketers need to analyze the purchase intention categories. For example, measuring the speed, direction, and size of shifts in buying. The market may also find significant implications for his marketing strategy by investing the relationship between purchasing intentions and buying behavior.

Chapter-13: Attitudes



Chapter-13: Attitudes
Definition:
Social psychologists, unfortunately, do not agree on the precise definition of an attitude. In fact, there are more that 100 different definitions of the concept. An attitude is how positive or negative, favorable or unfavorable, or pro or con a person feels toward an object. On the other hand attitudes may be defined as an enduring organization of motivational, emotional, perceptional, and cognitive process with respect to some aspects of the individual’s world. Another view is that attitudes view as learned predispositions to respond to an object or class of objects in a consistently favorable or unfavorable way.
This view of attitudes as being made up of three components: (i) the cognitive, or knowledge, component, (ii) the affective, or emotional, component, and (iii) the conative, or behavioral-tendency, component.
A consumer may believe strongly that Listerine mouthwash kills germs, helps prevent colds, gives people clean, refreshing breath, and prevents sore throats. If this consumer evaluates all five of these attributes as favorable qualities then according to the definition of attitude, he could have strongly favorable overall attitudes toward the brand.

Characteristics of Attitudes:
Attitudes have several important characteristics or properties:
(i) Attitudes have an object: By definition attitude must have an object. That is they must have a focal point – whether it be an abstract concept, such as ethical behavior, or tangible item, such as motorcycle. The object can be a physical thing, such as product or it can be an action, such as buying a personal computer. In addition, the object can be either one item such as a person, or a collection of items such as a social group.
(ii) Attitudes have direction, degree, and intensity: An attitudes express how a person feels toward an object, It expresses (i) direction – the person is either favorable, or unfavorable toward or for or against the object, (ii) degree – how much the person either likes or dislikes the object, and (iii) intensity – the level of sureness or confidence of expression about the object, or how strongly a person feels about his or her conviction. The direction, degree, and intensity of a person’s attitude toward a product have been said to provide marketers with an estimate of his or her readiness to act toward.
(iii) Attitudes have structure: Attitudes display organization, which means that they have internal consistency and possess inter-attitudinal centrality. Attitudes do not stand in isolation; they tend to associate each other to form a complex whole. Because attitudes cluster into a structure, they tend to show stability over time. A person’s attitude toward a specific object tends to generalize toward a class of objects.
(iv) Attitudes are learned: Just as a golf swing, a tennis stroke, and tastes are learned, so are attitudes. They develop from our personal experience with reality, as well as from information from friends, salespeople, and news media. Therefore, attitudes changes.

Functions of Attitudes:
Attitudes serve four major functions for the individual. These functions serve people’s need to protect and enhance the image they hold of themselves. In more general terms, these functions are the motivational bases which shapes and reinforce positive attitudes toward goal object perceived as need-satisfying and /or negative attitude other objects perceived as punishing or threatening.
(i) Adjustment Function: The adjustment function directs people toward pleasurable or rewarding objects and away from unpleasant, undesirable ones. It serves the utilitarian concept of maximizing reward and minimizing punishment. Thus, the attitudes of consumers depend to a large degree on their perceptions of what is need satisfying and what is punishing.
(ii) Ego-defensive Function: Attitudes formed to protect the ego or self-image from threats help fulfill the ego-defensive function. Actually, many outward expressions of such attitudes reflect the opposite of what the person perceives himself to be. A consumer who has made a poor purchase decision or a poor investment may staunchly defend the decision as being correct at the time or as being the result of poor advice from another person. Such ego-defense attitudes help us to protect our self-image, and often we are unaware of them.
(iii) Value Expressive Function: value expressive attitudes enable the expression of the person’s centrally hold values. Therefore, consumers adopt certain attitudes in an effort to translate their values into something more tangible and easily expressed. Thus a conservative person might develop an unfavorable attitude toward bright clothing and instead be attracted toward dark, pink-striped shirt. Marketer should develop an understanding of what values consumers wish to express about themselves, and they should design products and promotional campaigns to allow these self-expressions.
(iv) Knowledge Function: Humans have a need for a structured and orderly world, and therefore, they seek consistency, stability, definition, and understanding. Out of our need to know come attitudes about what we believe we need or do not need to understand. Attitudes enable consumers to simplify the complexity of the real world. Attitudes allow us to categorize or group objects as a way of knowing about them. Thus when a new object is experienced we attempt to categorize it into a group, which we know something about.

Sources of Attitude Development:
Attitudes develop from human needs and values people place upon objects that satisfy needs.
(i) Personal Experience: People come into contract with object in their everyday environment. Some are familiar, while others are new. We evaluate the new and reevaluate the old, and this evaluation process assists in developing attitudes toward object.
Several factors such as needs: because needs differ and also vary over time, people can develop different attitudes toward the same object at different points in their life; selective perception: we have seen that people operate on their personal interpretation of reality. Therefore, the way people interpret information about products, stores and so on, affects their attitudes toward them: and personality influence: how aggressive-passive, interpretation how we will evaluate.
(ii) Group Associations: All people are influenced to one degree or another by other members in the groups to which they belong. Our attitudes toward products, ethics, warfare, and a multitude of other subjects are influenced strongly by groups that we value and with which we do or wish to associate. Several groups, including family, work and peer groups, and cultural and sub-cultural groups, are important in affecting a person’s attitude development.
(iii) Influential others: A consumer’s attitude can be formed and changed through personal contact with influential persons such as respected friends, relatives, and experts. Opinion leaders are examples of people who are respected by their followers and who may strongly influence the attitudes and purchase behavior of followers.
To capitalize on this type of influence, advertisers often use actors and actresses who look similar to or act similar to their intended audiences. People tend to like others who are similar to themselves, because they believe that they share the same problem, from the same judgments, and use the same criteria for evaluating products.

Sources of information and influence
Personality /
Self-concept
Other beliefs
and attitudes



General attitude toward product or brand
1. Direct experience
Perception of information about product of brand
Beliefs about product or brand
2. Groups (social work, family, culture, etc)
Importance of beliefs about product attributes
3. Mass media
4. Contact with   influential others
Need structure
Value system

Figure #: A simple diagram of the interrelationships of an attitude toward a product or brand and other psychological processes.
The above figure shows a concise picture of psychological and external elements often claimed to be involved in the process of forming attitudes toward products. The process is dynamic and it continues to change over time.

Attitude Theories and Models:
Attitude theories primarily are concerned with how attitudes develop and change, Three of the more popular view points are founded on the general principle that the human mind strives to maintain harmony or consistency among currently perceived attitudes. If the mind perceives an inconsistency with its attitudes structures, mental tension develops to return the structures to a consistent state.

Congruity Theory: Assume that a consumer initially holds positive attitudes toward the rock group U2 (positive scale value +2) and negative attitudes toward a particular brand of electronic guitar (negative scale value –2). Then the consumer sees and advertisement where the U2 group makes positive statements about this brand of electronic guitar. Given this situation, the consumer will have inconsistent attitudes. (U2 whom I like, said nice things about a brand of guitar that I don’t like).
The consumer is now in a state of incongruity, which produces uncomfortable tension that must ultimately lead to resolution of the incongruity. The congruity model predicts that a person in this situation would reduce his favorable attitude toward group U2 and also become more favorable in his attitudes toward the brand of electric guitar. The model would predict a movement of two units of each attitude toward each other (the center) because the consumer perceives both objects as being of equal strength but in opposite directions of the zero neutral points.
The congruity principle is used frequently in marketing. Advertisers often use hired celebrities to endorse brands, services, organizations, and causes. Athletes speak against drug use among young people. The intent is to have consumers who hold positive attitudes toward a source to develop a positive value association between the source and the object.

Balance Theory: According to balance theory, a person perceives her or his environment in terms of triads. That is a person views herself or himself as being involved in a triangular relationship in which all three elements (person, ideas, and things) have either positive (liking, favorable) or negative (disliking, unfavorable) relationships with each other. This relationship is termed sentiment.
If the multiple relationship is negative it is called unbalanced and if positive, called balance. For example, (i) I like large luxurious cars. (ii) I don’t like energy-washing products. (iii) I believe large, luxurious car waste energy. The structure is not balance because there is positive relation on two sides and a negative relationship on the third.
This relationship creates tension, and it may possible to live with it and do noting. However, if sufficient tension exists, it is likely that attitude change will occur. For example, (i) disliking large, luxurious cars; (ii) believing that large, luxurious cars are not really energy-washing products; and (iii) liking energy-washing products. This rationalization can help change our perceptions of relationships and thus our attitudes.

Cognitive Dissonance: Cognitive dissonance results when a person perceives that two cognitions (thoughts), both of which he believes to be true, do not fit together; that is they seem inconsistent. The resulting dissonance produces tension, which serves to motivate the individual to bring harmony to inconsistent elements, thereby reduce psychological tension.
A person experiencing cognitive dissonance has three major ways to reduce it. (i) Rationalization, (ii) Seeking additional information that is supportive of or consistent with his behavior, and (iii) Either eliminating or altering some of the dissonance elements or by changing his attitude so that it is no longer dissonant. Each of the strategies may be used in alone or in combination.

Friday, February 22, 2013

Chapter-12: Learning and Memory



Chapter-12: Learning and Memory

Learning Defined:
Learning can be defined as a relatively permanent change in behavior occurring as a result of experience. The term behavior is used to refer to non-observable   cognitive activity as well as to overt actions. Therefore, it is very possible for learning to occur without any change in observable behavior. Learning results in relatively permanent changes in behavior excluding the effects of physical damage or to the body or brain and of natural human growth.   

Types of Learned Behavior:
(i) Physical behavior: We learn many physical behavior patterns useful in responding to a variety of situations faced in everyday life. For example, we learn to walk, talk, and interact with others. As a consumer we learn methods of responding to various situations as result satisfactions and dissatisfactions may occur.
(ii) Symbolic learning and problem solving: People learn symbolic meanings that enable highly efficient communication through the development of languages. Symbolic also allows the marketer to communicate with the consumers through such vehicles as brand names (Sony, Kodak etc.)
(iii) Active learning: Consumers learn many of their wants, goals, and motives as well as products satisfy these needs. Learning also influences consumers’ development of favorable or unfavorable attitudes toward a company and its products. These attitudes will affect the tendency to purchase various brands.

Principal Elements of Learning:
Consumers learn in several basic ways. However, four elements seem to be fundamental. The extent nature and strength of these components influence what will be learned, how it will be learned, and the rate it which learning will occur.
(i) Motive: motives arouse individuals, thereby increasing their readiness to respond. These arousal activities are essential, since it activates the energy needed to engage in learning activity. Any success at achieving the motivational goal or avoiding some unpleasant situation, tend to reduce arousal.
(ii) Cues: a cue may be viewed as a weak stimulus not strong enough to arouse consumer, but capable of providing direction to motivated activity. That is, it influences the manner in which consumer respond to a motive.
(iii) Response: a response may be viewed as mental or physical activity the consumer makes in relation to a stimulus situation. Responses appropriate to a particular situation are learned over time through experience in facing that situation. A hungry baby is more likely to cry or exhibit behavior than other responses.
(iv) Reinforcement: reinforced behavior tends to be repeated; consumers can learn to develop successful means of responding to their needs or changing condition. One important type of reinforcement achieved through reducing motive arousal. This occurs through removing a negative reinforcer (something that generates discomfort and is avoided), or receiving a positive reinforcer (something that generates pleasure and is sought).

Learning Classifications:
Various theories have been developed to explain different aspects of learning. These theories however, can be grouped into several major categories: Learning connections and cognitive interpretations.
Learning connections: some learning theorists maintain that learning involves the development of connections between a stimulus and some response to it. That is, the association of a response and a stimulus is the connection that is learned.
(i) Classical conditioning: Essentially, classical conditioning pairs one stimulus with another that already elicits a given response. Over repeated trials, the new stimulus will also begin to elicit the same or a very similar response. Experiment conducted by Pavlov, reasoned that because food (unconditioned stimulus) already caused his dog to salivate (unconditioned response), it might be possible to link a previously neutral stimulus to the food so that it too would be able to make the dog salivate.
(ii) Instrumental conditioning: this method also involves developing connections between stimuli and responses, but in a different way. A box named Skinner box, in one wall there is button which when pressed will deliver food to the pigeon in the box. When placed in the box, the pigeon will respond in a variety of ways. Eventually, it pushes the specific button and receives the food, and eats it with great enjoyment. As the push of the button will lead to reinforcement, this will help the pigeon to learn.

Cognitive interpretations: Instead of viewing learning as the development of connections between stimuli and responses, cognitive theorists stress the importance of perception, problem solving, and insights. This viewpoint contends that much learning occurs not as a result of trial-and-error or practice but through discovering meaningful patterns, which enable us to solve problems. As long as an individual has not solved a problem, a state of incompleteness produces tension to motivate continued search for a solution. Problem solution results in closure, which reduces the motivation tension and is reinforcing.

Memory:
As everyone’s experience has demonstrated, material that consumers have learned is not always readily retrievable by them. Some information, such as popular brand names or the location of merchandise in a supermarket, is easily remembered. Other information appears to end up lost, or at least it does not appear to be readily obtainable.
Memory processes are of considerable importance to the understanding of consumers. Basically, this is so because to a large extent, consumers act on the basis of their cognitions, or their knowledge or beliefs about the word. These cognitions are stores in memory and they influence how incoming stimuli are interpreted. They also form the basis for attitudes, behavioral intentions, and brand choice.

A representation of memory system: Several views exist regarding the structure of memory and its operation. One termed the multiple store approach, views memory as viewing composed of three distinctive storage registers (sensory, short-term, long-term) which differ in capacity, storage duration and functioning.
(i) Sensory memory: information is first received by sensory memory. Information is in the form of sensations that have been produced by the sensory receptors. Memory registers exist for sensations being produced by the visual, auditory, and other sense organs. The capacity of these registers is very large – capable of storing all that the sensory receptors transmit. A good illustration of the nature of these representations is the after-image we see in our minds eye immediately after observing an object and closing our eyes.  
(ii) Short-term memory: To a large extent, short-term memory can be viewed as the workplace for information processing. That is, it is a portion of memory activated to temporarily store and process information in order to interpret it and comprehend its meaning. This is accomplished by combining incoming information with other information (past experience, knowledge, and the like) stored in long term memory.
Although the duration of this memory register is considerably longer than that of sensory memory, it still is very brief, lasting less than one minute. In addition, the capacity of short-term memory is quite limited. Approximately, seven items or groupings of items are all that can be stored at any one time. 
(iii) Long-term memory: This memory system can be thought of as the relatively permanent storehouse for information that has undergone sufficient processing. Material can be maintained in long-term memory for as little as a few minutes to as long as many years. This system has the capacity to store an almost unlimited amount of information.
A predominant key to coding material for storage in long-term memory is meaningfulness, the personal understanding an individual can derive from the information. That is, through elaborative rehearsal the individual uses his existing knowledge to interpret incoming information and code it in a way that is consistent with his existing cognitive structure (knowledge base).
Some people claim that we never really forget anything that has been transferred to long-term memory. They argue that, what is forgotten is the key, which tells us where the material is located in our memory.

Advertising Applications of memory:
(i) Advertising messages with unique aspects have a greater potential for being remembered. Because material with unusual aspects is least affected by the process of forgetting.
(ii) The order in which material is presented seems to influence how well it will be retained, with the middle portion being most easily forgotten. The beginning and ending message stand out the most in remembering event.
(iii) Messages that encourage immediate rehearsal of material stimulate its retention. Maintenance rehearsal keeps material in short-term memory, and elaborative rehearsal will encourage the transfer to long-term memory.
(iv) More information can be processed and retained if it is chunked. The capacity of short-term memory is approximately seven items.
(v) The amount of information that can be transferred to long-term memory is a function of the time available for processing.
(vi) Memory is cue-depended, and presentation of relevant cues will stimulate recall. Certain cues present during the learning context associated with the material in the memory.
(vii) Material retained in long-term memory can be quite different from the information presented in a leaning situation. Some information will be lost from the short-term memory.
(viii) Material that is meaningful to the individual is leaned more quickly and therefore has a greater chance of being retained than does non-meaningful material. Some methods may be visual material, interactive imagery, showing mistakes, incomplete message, may be helpful for the marketer to increase individual learning more quickly.
Again, it should be stressed that the above list of general guidelines regarding consumers’ memory is not by any means exhaustive. In addition, the specific situation must be considered for employing any of them. However, the list is illustrative of the potential benefits of applying such concepts to the design of marketing communications.