1. What is the role theory, and how does it help us to understand consumer behavior?

Each consumer has lines, props and costumes that are necessary to a good performance. Since people act out
many different roles they may modify their consumption decisions according the particular play they are in at
the times. The criteria that they use to evaluate products and services in one of their roles may be quite
different from those used in another role. Another way of thinking about consumer roles is to consider the
various plays that the consumer may engage in. One classical role here is the consumer as a chooser –
somebody who can choose between different alternatives and explores various criteria for making this choice.
But the consumer can have many other things at stake than just making the right choice. We are all involved in
a communication system through our consumption activities, whereby we communicate our roles and statuses.
We are also sometimes searching to construct our identity through various consumption activities.
The main purpose of our consumption might be exploration of a few of the many possibilities the market has to
offer us. We might feel victimized by fraudulent or harmful offerings from the marketplace and we may decide
to take action against such risks from the marketplace by becoming active in consumer movements. Or we may
react against the authority of the producers by co-opting their products and turning them into something else
as when military boots all of a sudden became normal footwear for peaceful women. We may decide to take
action as political consumers and boycott products from companies or countries whose behavior does not
meet our ethical or environmental standards. Hence as consumers we can be choosers, communicators,
identity seekers, pleasure seekers, victims, rebels and activists.

2. How does the sense of touch influence consumers’ reactions to products?

Haptic senses appear to moderate the relationship between product experience and judgment confidence.
We’re more sure about what we perceive when we touch it. Have you ever noticed that some shoppers are
drawn to touch store merchandise? Some consumers like to handle all sorts of products, even those that they
do not intend to buy. Store managers have recognized that displays which allow customers to touch items can
lead to increased sales. However, marketers may wonder under what conditions this increase in sales is most
likely to occur. Touch researchers have learned that there are variations in people’s “need for touch”—their
preferences and motivations for obtaining product information by touching the product. Moreover, certain
product categories—those that vary in texture, weight, hardness, and temperature, all of which can be
appreciated best through touch—are more likely to encourage touch prior to purchase. These findings have
important implications for managers. Point-of-purchase signs, displays, and packaging that encourage people
to touch the product may increase the likelihood that consumers will make a purchase. For people with a high
“need for touch,” a marketing communication that incorporates touch leads to increased customer response
and greater persuasion.

3. What is the difference between an unconditioned stimulus and a conditioned stimulus?

Conditioned and unconditioned responses are behaviors that result from specific stimuli. An unconditioned
response is behavior that occurs naturally due to a given stimulus. However, a stimulus prompts a conditioned
response only when someone has come to associate that stimulus with another. For example, when a person
yelps upon being bitten by an insect, the yelp is an unconditioned response. After hearing a buzzing every time
one is bitten, one might begin to yelp every time one notices the sound: this is a conditioned response because
it occurs after one learns to associate the buzz with an insect bite (it does not occur spontaneously).
Psychologists distinguish between conditioned and unconditioned responses to explain classical conditioning, a
kind of learning.

4. Describe three types of motivational conflicts, citing an example of each from current marketing campaigns.
In an approach–approach conflict, a person must choose between two desirable alternatives. A student might
be torn between going home for the holidays and going on a skiing trip with friends. Many of the products and
services we desire have negative consequences attached to them as well. We may feel guilty or ostentatious
when buying a status-laden product such as a fur coat, or we might feel like a glutton when contemplating a
tempting package of Twinkies. An approach–avoidance conflict exists when we desire a goal but wish to avoid
it at the same time. Sometimes consumers find themselves “caught between a rock and a hard place.” They
may face a choice with two undesirable alternatives, for instance, the option of either throwing more money
into an old car or buying a new one. Marketers frequently address an avoidance–avoidance conflict with
messages that stress the unforeseen benefits of choosing one option (e.g., by emphasizing special credit plans
to ease the pain of car payments).
5. How do feelings about the self-influence the specific brands people buy?
The influential role of emotion in consumer behavior is well documented: When evaluating brands, consumers
primarily use emotions (personal feelings and experiences), rather than information (brand attributes, features,
and facts). Advertising research reveals that the consumer's emotional response to an ad has a far greater
influence on their reported intent to buy a product than does the ad’s content—by a factor of 3-to-1 for
television commercials and 2-to-1 for print ads. “Likeability” is the measure most predictive of whether an
advertisement will increase a brand’s sales. Studies show that positive emotions toward a brand have a far
greater influence on consumer loyalty than trust and other judgments, which are based on a brand’s attributes.
Emotions are the primary reason why consumers prefer brand-name products. After all, many of the products
we buy are available as generic and store brands with the same ingredients and at cheaper prices. Why do we
decide to pay more for brand-name products?
A nationally advertised brand has power in the marketplace, because it creates an emotional connection to the
consumer. A brand is nothing more than a mental representation of a product in the consumer’s mind. If the
representation consists only of the product’s attributes, features, and other information, there are no
emotional links to influence consumer preference and action. The richer the emotional content of a brand’s
mental representation, the more likely the consumer will be a loyal user.

6. Why digital marketing is replacing conventional marketing?

Traditional marketing refers to any type of promotion and advertising of goods and services which includes:
Print media, Billboards, Flyers or pamphlets, TV, Newspaper, Radio, etc. At that time, it takes so much of
efforts, cost and time to use these kinds of methods. In this marketing, a business owner has to wait for a long
time to speak to their customers as it takes time to reach them out. But, traditional marketing is not dead it is
just replaced by digital marketing in a better way. Digital marketing is the new form of marketing which simply
involves the promotion of goods and services using digital mediums like Facebook, Instagram, YouTube,
LinkedIn etc. Digital marketing is basically result-oriented. In this marketing, you can target your audience
globally which you were not supposed to do in traditional form of marketing. Difference between Traditional
marketing and Digital marketing: Costs: In traditional marketing, it takes a high cost whenever you want to
place an ad in Radio, newspaper etc. But in digital marketing there is no limit of budget, you can place your ad
easily in any of the digital platforms like Facebook. Customization: In traditional marketing, it is difficult to
target your customer, especially an individual. But in Digital marketing, you can target your customer according
to his/her age, location, gender, and interest etc. in a very short time. Measurability: In traditional marketing,
it’s not easy to keep a track for your campaigns. But, in digital marketing, you can easily keep an eye on
analytics to measure and track about all of your campaigns. There are so many tools like Google Analytics that
helps you to keep a track whether your ads are working properly or not. Stats: More than 80% of
shoppers/buyers do their research online before investing in a product/service. Almost 60% of U.S. adults use
Facebook on a regular basis. 94% of B2B marketers are actively using LinkedIn for marketing. Mobile will be
accounting for over 70% of digital ad spend by 2019.
90% of B2C businesses report social media as being the most effective content marketing tactic.

7. Explain what is meant by brand image, brand awareness and brand equity.

8. brand image is identified

as observation about the
brand as replicated by the
9. brand relations detained in
customer psyche
Brand image is identified as observation about the brand as replicated by the brand relations detained in
customer psyche. Brand image also stated as brand sense, and it is mainly established on customers’ previous
considerations and the position of the product or service but as well affected by organizations symbol of their
 external brand communications. The victorious brand image make potential customer to know wants which
brand fulfills to differentiate the brand among its rivals, and consequently enhance the likelihood that
customers determination to buy brand. Brand image is also known like an essential source of brand equity.
If a consumer ever seen or listen about brand he can let know a brand properly. Brand awareness play main
role in consumer’s decision making, since the superior the brand awareness, that definite product/brand will
turn into part of consumer’s deliberation set of brands. Consumer obtain brand awareness with marketing
communication. Brand awareness is how customers link brand through the exact product that they aspire to
possess. Brand awareness is a marketing term that describes the degree of consumer recognition of a product
by its name. Creating brand awareness is a key step in promoting a new product or reviving an older brand.
Ideally, awareness of the brand may include the qualities that distinguish the product from its competition.
Brand awareness has straight belongings on brand’s equity.
Brand equity refers to a value premium that a company generates from a product with a recognizable name
when compared to a generic equivalent. Companies can create brand equity for their products by making them
memorable, easily recognizable, and superior in quality and reliability. When a company has positive brand
equity, customers willingly pay a high price for its products, even though they could get the same thing from a
competitor for less.

10. What are some factors that influence how an organizational buyer evaluates a purchase decision?
There are five factors that influence an organizational buying decision identified by Sheth:
Background of the individuals: educational background, their requirements of their roles within the
organization and their lifestyles. Information sources: purchasing agents would have greater exposure to
commercial sources of product information then QC engineers or manufacturing management. Active search:
active search for information on competing suppliers` products is carried out by purchasing personnel as this is
considered part of the purchasing function. Perceptual distortion: the differing values and goals of the three
groups of individuals will exert an influence on their perception of available objective information so that there
is consistency with prior knowledge and beliefs. Satisfaction with past purchase: as the three parties involved
may have different goals, they are likely to use different criteria in evaluating past experiences of products. The
degree of satisfaction achieved with past purchases may therefore differ between the parties involved and this
will affect their expectations in the current decision process.

11. Explain why it is important to study consumer behavior.

1. It concerns with modern marketing philosophy – identify consumers’ needs and satisfy them more
effectively than competitors. It makes marketing consumer-oriented. It is the key to succeed.
2. Achievement of Goals: The key to a company’s survival, profitability, and growth in a highly competitive
marketing environment is its ability to identify and satisfy unfulfilled consumer needs better and sooner than
the competitors. Thus, consumer behavior helps in achieving marketing goals.
3. Useful for Dealers and Salesmen: The study of consumer behavior is not useful for the company alone.
Knowledge of consumer behavior is equally useful for middlemen and salesmen to perform their tasks
effectively in meeting consumers’ needs and wants successfully. Consumer behavior, thus, improves
performance of the entire distribution system.
4. More Relevant Marketing Programme: Marketing programme, consisting of product, price, promotion, and
distribution decisions, can be prepared more objectively. The programme can be more relevant if it is based on
the study of consumer behavior. Meaningful marketing programme is instrumental in realizing marketing goals.
5. Adjusting Marketing Programme over Time: Consumer behavior studies the consumer response pattern on a
continuous basis. So, a marketer can easily come to know the changes taking place in the market. Based on the
current market trend, the marketer can make necessary changes in marketing programme to adjust with the
market.
6. Predicting Market Trend: Consumer behavior can also aid in projecting the future market trends. Marketer
finds enough time to prepare for exploiting the emerging opportunities, and/or facing challenges and threats.
7. Consumer Differentiation: Market exhibits considerable differentiations. Each segment needs and wants
different products. For every segment, a separate marketing programme is needed. Knowledge of consumer
differentiation is a key to fit marking offers with different groups of buyers. Consumer behavior study supplies
the details about consumer differentiations.
8. Creation and Retention of Consumers: Marketers who base their offerings on a recognition of consumer
needs find a ready market for their products. Company finds it easy to sell its products. In the same way, the
company, due to continuous study of consumer behavior and attempts to meet changing expectations of the
buyers, can retain its consumers for a long period.
 9. Competition: Consumer behavior study assists in facing competition, too. Based on consumers’ expectations,
more competitive advantages can be offered. It is useful in improving competitive strengths of the company.
10. Developing New Products: New product is developed in respect of needs and wants of the target market. In
order to develop the best-fit product, a marketer must know adequately about the market. Thus, the study of
consumer behavior is the base for developing a new product successfully.
11. Dynamic Nature of Market: Consumer behavior focuses on dynamic nature of the market. It helps the
manager to be dynamic, alert, and active in satisfying consumers better and sooner than competitors.
Consumer behavior is indispensable to watch movements of the markets.
12. Effective Use of Productive Resources: The study of consumer behavior assists the manager to make the
organizational efforts consumer-oriented. It ensures an exact use of resources for achieving maximum
efficiency. Each unit of resources can contribute maximum to objectives.

12. What is learning? Explain behavioral and cognitive learning.

Learning is the activity or process of acquiring knowledge or skill by studying, practicing, or experiencing
something. The behavioral approach dominated psychology for many years. Learning was the central axis of all
theory and research. This occurred through mechanisms of consequences and reinforcement of behavior:
classical and operant conditioning. However, with the arrival of cognitivism, everything changed, since mental
processes were considered.
The behavioral (learning as a response to changes in our environment) perspective is the psychological
approach that suggests that the keys to understanding development are observable behavior and external
stimuli in the environment. Behaviorism is a theory of learning, and learning theories focus on how we respond
to events or stimuli rather than emphasizing internal factors that motivate our actions. These theories provide
an explanation of how experience can change what we do (Pavlov and his dogs).
Cognitive psychology assumes that humans have the capacity to process and organize information in their
mind. It is concerned less with visible behavior and more with the thought processes behind it. Cognitive
psychology tries to understand concepts such as memory and decision making.

13. Compare and contrast different approaches to decision-making by consumers.

1. Nominal Decision-Making: Nominal decisions are often made about low-cost products. They include
frequent purchases, purchases from a familiar brand or product, buying that requires low involvement, or little
search efforts. The important thing to remember about nominal decision-making, is that too much marketing
effort can have a negative impact on your customers. If someone is already happy to buy an item on impulse,
or because of brand loyalty, they don’t need constant interaction with the brand asking them what they like
about the substance, or whether they want to change anything. Too much marketing is not only debilitating to
your budget, but it can get on your customer’s nerves – which is a dangerous thing for brands in this highly
competitive era. When purchasing your product is a nominal decision, marketers simply need to perform brand
maintenance. 2. Limited Decision-Making: Limited decision-making is a little more involved than nominal
decision-making, but it’s still not a process that requires in-depth research. Limited decisions are made about
mid-cost products, semi-frequent purchases, or purchases from a somewhat familiar brand. They require a
little involvement, and perhaps some searching. When customers make limited decisions, they take a small
amount of time to ponder over their purchase, but they might not go online to look for testimonials and
reviews. Instead, they could consider their memory of their product, and make decisions based on logical
inferences. When it comes to addressing limited decision-making, it’s important for marketers and brands to
examine their customer data, and understand the factors that influenced decision-making. Finally, (3)
extended decisions are made about higher-cost products, and infrequent purchases. They require a lot of
involvement, often centre around unfamiliar brands or products, and need extended thought and search
efforts to ensure buyer confidence. Major purchases come with more risk for the customer, and that means
that there’s more cause to consider things from a deeper perspective. When it comes to influencing extended
decision-making, the best thing that any brand can do is work on building their positive online presence (social
presence, provide extensive product details, offer interactive guides, etc.).

14. Identify three motivations for shopping.

Firstly, and naturally, it’s Money. Most salespeople think that when a buyer asks for a discount or a lower price,
it’s because they don’t see the value in your product or service. However, it goes down to a deeper level than
that. We have to remember that most of our B2B buyers want a lower price because: 1) They want to get more
repeat business from their customers; 2) They want to offer something better than their competition. So, their
rationale in asking for a lower price may revolve around their ability to offer their customers a better deal.
 Secondly, a buying influencer may be Reduced Risk. What is meant by this is that sellers may want to have
greater confidence they won’t miss their deadlines with their customers. It could be they want greater
confidence that the products they offer will actually do what they promise they will do. And they want to give
their customers more reasons to use them, so their reputation increases and they become more attractive to
new clients. So, one of the areas you can highlight could be how your products and services reduce the risks
they have to take in their market-place. This will give them more confidence and peace of mind when they sell.
Another key component in decision-making may be Time. If you are able to offer confidence to your prospect
that you will be able to deliver on time, there will be less time spent by them on worrying about customer
complaints and issues of inventories. It will also give them confidence that the value of dealing with you is
greater because they can trust your promises and can get on with what they do best, without worrying about
what’s happening in the background.

15. Distinguish between different types of impulse purchasing.

Accelerator impulse: consumers are motivated to stockpile, purchasing in advance of some future need. Sales
promotions such as BOGOF (buy one get one free) appeal to this type of impulse, as consumers can rationalize
the purchase as likely to be used in the future. Compensatory impulse: consumers make impulse purchases as
a reward for success or as compensation for failure. Advertisements for confectionary or snacks often suggests
that we deserve compensation or reward through food. An example of this is “have a break – have a KitKat”
slogan where the marketer makes an association of a rest from work with a chocolate snack. Breakthrough
impulse: this type of impulse relates to the sudden need to make a purchase, often triggered by some kind of
unconscious problem or issue. Researchers suggest that it can be life changing as well as dealing with particular
issues suffered by the person. For example, an impulse a man may see a ring in a jewellery shop, buy it, and
propose to his girlfriend. Advertisements shown around Valentine`s Day often try to encourage such impulsive
behaviour. Blind impulse: this refers to impulse buys that are not easily explained or rationalized by the
consumer. Often this occurs when a consumer is overwhelmed by the product and feels that they just have to
have it immediately, without any thoughts for the cost implications.

16. Define attitude, belief and intention and explain how these concepts are measured.
Consumer attitude may be defined as a feeling of favourableness or
unfavourableness that an individual has towards an object. As we, all
know that an individual with a positive attitude is more likely to buy a
product and this results in the possibility of liking or disliking a
product. Consumer attitude basically comprises of beliefs towards,
feelings towards and behavioural intentions towards some objects.
Belief plays a vital role for consumers because, it can be either
positive or negative towards an object. For example, some may say
tea is good and relieves tension, others may say too much of tea is
not good for health. Human beliefs are not accurate and can change
according to situations. Consumers have certain specific feelings
towards some products or brands. Sometimes these feelings are based on certain beliefs and sometimes they
are not. For example, an individual feels uneasy when he thinks about cheese burst pizza, because of the
tremendous amount of cheese or fat it has. Behavioural intentions show the plans of consumers with respect
to the products. This is sometimes a logical result of beliefs or feelings, but not always. For example, an
individual personally might not like a restaurant, but may visit it because it is the hangout place for his friends.
The most widely used approach to attitude measurement has been the attitude scale. 1. The Thurstone scale
consists of a set of statements about a certain issue, each of which has a numerical value stating how
(un)favourable it is judged to be. The respondents then tick only those statements to which they agree. After
they complete the survey, the mean score is calculated, indicating their attitude on the issue in question. 2. the
Likert scale is a five (or seven) point scale which is used to allow the individual to express how much they agree
or disagree with a particular statement. 3. The Osgood Semantic Differential (SD) measures people's reactions
to stimulus words and concepts in terms of ratings on bipolar scales defined with contrasting adjectives at each
end (good – bad).

17. Explain the concept of brand personality. Discuss three ways in which a company can develop a personality
for its products.
Brand personality is a set of human characteristics that are attributed to a brand name. A brand personality is
something to which the consumer can relate; an effective brand increases its brand equity by having a
 consistent set of traits that a specific consumer segment enjoys. This personality is a qualitative value-add that
a brand gains in addition to its functional benefits. Brand personality is a framework that helps a company or
organization shape the way people feel about its product, service, or mission. A company's brand personality
elicits an emotional response in a specific consumer segment, with the intention of inciting positive actions that
benefit the firm. Customers are more likely to purchase a brand if its personality is similar to their own.
1. Tell a story: Stories have a universal power to take simple words and transform them into concepts, allowing
them to take on a life of their own. As a content marketer, harnessing the power of storytelling can really help
capture your audience's attention and strike an emotional chord, which is unparalleled when it comes to
forming bonds and building strong customer relationships. 2. Be witty and/or humorous: Being witty and/or
humorous with your content can be great for creating conversations and encouraging positive brand
perceptions. The goal is to build relationships and people love having a laugh, when done right, being funny or
witty can help your brand in the following ways: It captures audience attention and makes you stand out from
all the digital "noise"; It makes your brand more memorable, which increases the likelihood of purchase and/or
advocation; It helps connect with your audience by eliciting an emotional response. 3. Use the power of
nostalgia: In the marketing world, leveraging the power of nostalgia can work wonders when it comes to
eliciting an emotional response from your audience. Striking that emotional chord is the bee's knees for
marketers, and nothing does it quite as well as referencing a blast from the past. 4. Celebrity Endorsements:
One shortcut to brand identity building that’s often used by a variety of companies is celebrity endorsement.
This can be helpful in establishing the kind of people you want your brand to appeal to. 5. Creating a
Personality: There are plenty of brands which thrive through inventing an identity, or otherwise embellishing
the story of an individual to help build up a sense of identity for their company.
This is particularly common for fast food chains, who opt to include mascots that customers can learn to
identify.

18. Describe personality trait theory. Give five examples of how personality traits can be used in consumer
research.
A personality is regarded the sum of a set of traits or qualities about a person, and these can be used to predict
or explain consumption behavior. This view works on the basis that traits can be assessed and evaluated. The
trait-based approach assumes a quantitative approach to personality, which is viewed as comprising of a set of
traits. According to the trait-based view of the self, an individual`s personality is composed of definite
predispositional attributes (traits) and they can be described in terms of a particular combination of these
traits. It is assumed that traits are common to many individuals, but the exact combination reflects the
personality of the individual. Traits are relatively stable and exert fairly universal effects on behavior regardless
of environment. There is a single-trait approach (focus is on one trait that is particularly relevant to a situation)
and multi-trait approach (concerned with a number of personality traits taken together and how they combine
to effect consumption).
Openness means being open to experiencing new or different things. Those who score high on this trait tend to
be intellectually curious, willing to try new things, and more creative or unconventional. Those who score low
on this trait are usually opposed to change and struggle with abstract thought. Conscientiousness refers to
acting in an organized or thoughtful way. Those who score high on conscientiousness tend to be self-
disciplined, strive for achievement, and follow a plan or schedule. Scoring low on this trait, you may be more
unstructured in your approach to tasks and procrastinate more often. Extraversion is seeking stimulation in the
company of others. Those who score high on this trait don’t mind being the center of attention and tend to be
very social and energetic. Those who score low on extraversion often prefer to be alone and may be anxious in
social situations. Agreeableness entails being compassionate and cooperative towards others. Those who score
high on agreeableness tend to get along well with people and are more sympathetic and caring. Those who
score lower on this trait can be less empathetic and seem uninterested in others. Neuroticism refers to
emotional sensitivity—particularly when it comes to environmental or situational factors. Those who score high
for this trait can be easily stressed and sometimes come off as worry-warts. Those who score low on
neuroticism, on the other hand, tend to be more emotionally grounded and laid-back.

19. What is perception? What is the role of our five senses in perception? Use some common examples to
illustrate.
Perception is a process by which a consumer identifies, organizes, and interprets information to create
meaning. A consumer will selectively perceive what they will ultimately classify as their needs and wants.
Perception is a psychological variable involved in the purchase decision process that is known to influence
consumer behavior. Other variables included in this consumer process include: motivation, learning, attitude,
 personality, and lifestyle. All of these concepts are crucial in interpreting the consumer buying process and can
also help guide marketing efforts.
Creating customer experience seems to be one of the central objectives in retail environments. Consumers
satisfy their needs by means of a complex of experiences that are filtered through their senses. Experiential
marketing has therefore become a popular marketing technique used by marketers in promotions. More
specifically, sensory marketing has been applied in various ways in below-the-line promotions. According to
research, marketers need to incorporate all the senses in sensory marketing as senses rarely operate in
isolation. In the field of marketing, incorporating consumers’ senses of sight, smell and sound is a popular
sensory marketing tool as these senses are classified as the main senses in humans. Incorporating senses such
as touch and taste remains a challenge for marketers as certain products such as expensive alcohols and
computer software do not necessarily lend themselves to be promoted by means of touch and taste in a retail
setting.
Example: entering a chocolate store where the chocolate smell is pushed in the air, X-mas music and ads are
running on the radio in the background (sound) and a stand with samples is waiting for a customer to try the
chocolate (sight + taste + touch).

20. What is involved in creating satisfied customers?

1. Revamp your customer service: Consumers always remember companies with great customers service, so
make sure that yours is top notch. Establish a special follow up procedure, where your employees would call
consumers to ask them whether they’re happy with your product or service. Follow up to make sure your
clients received the product or provide some updates on the delivery arrangements – all this will show you care
about your customers and rely on their trust. 2. Seek consumer opinion: When following up, it’s great to ask
your clients what they think about your product. Your interest in what they think about your company’s offer
will make them feel valued and engaged with your brand – and this is the first step to building a lasting
relationship. 3. Personalize it: When contacting your clients, make sure to remember their name and your
previous conversation with them. Refer to their last purchase and ask about it. All this will help them feel more
‘at home’ with your business. 4. Send birthday cards and seasonal greetings: If you’ve got a comprehensive
client database, this kind of follow up can be easily automatized. Sending e-mails with seasonal greetings and
featuring some relevant offers, discounts and sales advertisements will give you an opportunity for regular
updates. Sending a birthday card, you can attach a special promo code or a personalized selection of products
related to the ones bought by the client. 5. Reward consumer referrals: Grant your costumers special
promotions or discounts if they refer your company to their family and friends. This follow up will help you to
build a stable consumer network built on trust and loyalty. 6. Offer something of value: This is especially
relevant if you’ve got a team of sales reps eager to find new customers and establish closer relationships with
your regulars. Every time they contact a client, they should offer something of value – information about
developments in the industry, an interesting article that matches the interests of the customer or a notice
about what’s new at the company. 7. Send a hand-written note: Sending a thank-you note in a e-mail won’t
impress anyone. A handwritten note is a great idea – not only is it more personal, but also very original. This
applies mostly to situations where the sale is arranged personally by a sales representative. Establish this policy
and you’ll see your reps develop closer relationships with your customers.
Industry experts agree that it’s best to follow up within two weeks after the sale. Following up is easy, costs a
fraction of your time and can be vital in establishing valuable and long-lasting consumer relationships.

1. Why should a marketer study consumer behaviour? How can it enable him or her to devise better marketing
strategies?
In regard to the marketer’s view point, they assume that the basic purpose of marketing is to sell goods and
services to more people so that more profit could be made. This principle of making profits is heavily applied by
almost all marketers. Earlier, the marketers were successful in accomplishing their purpose. However, today, as
the consumers are more aware about the use of product and other information of the product, it is not easy to
sell or attract customer to buy the product. Thus, in order to sell a product or service or to convince consumers
to buy product, the marketers have to undergo through proper research to win them over. The following are
some of the points discussed that explains the value to marketers of understanding and applying consumer
behaviour concepts and theories. The study of consumer behaviour helps marketers to recognize and forecast
the purchase behaviour of the consumers while they are purchasing a product. The study of consumer
behaviour helps the marketers not only to understand what consumer’s purchase, but helps to understand
why they purchase it. Moreover, other questions like how, where and when they purchase it are also
answered. Consumer behaviour is of most importance to marketers in business studies as the main aim is to
 create and retain customers. If the consumers are satisfied with the product, he or she will buy the same
product again. Therefore, creating customers and the retaining of those customers are important. It is
important for marketers to consider the factors that affect the buying behaviour of consumer before entering
the market. There are many factors that can influence the purchase decision of consumers such as social
influence, cultural influences, psychological factors and personal factors. Effective marketing of a product by
sales people may help to deliver right product to right people. Consumer behaviour deals with the knowledge
of what the consumers need and want to buy and what goods and services are available to satisfy their needs.
The theories and concepts of Consumer behaviour help marketers to optimize their sales and to create efficient
marketing strategies. Moreover, these theories provides marketers with information on the consumer’s
behaviour to spend money, likely causes that incline them to spend more money on a product, and these two
information help to plan strategies that should be practiced by the marketers for successful marketing of a
product

21. Elaborate on perception process. What factors affect an individual’s perception?

A customer`s decision to purchase a
product will be influenced largely by
the way how he perceives the
product. His perception will be
affected not only by the quality of the
product, but the attributes as well
(which are successfully presented by
advertising, packaging, and other
techniques).
1. Sensation (vision, hearing, touch,
taste, smell): provides us the
information on the world (product)
around us. Via the sense receptors this information is transmitted to the nervous system – sensation: the
collection of information and perception: the way how we interpret this information.
The absolute threshold of a sensation is defined as the intensity of a stimulus that allows an organism to just
barely detect it (perfume in 6room flat, teaspoon of sugar in 2gallon water, etc.). The difference threshold (or
just noticeable difference [JND]), refers to the change in a stimulus that can just barely be detected.
2. Localization: to know where the objects are in our environment first, we have to separate the objects from
one another and from the background. Figure (and object grouping) and ground relationship.
3. Recognition: shape, size, colour and texture are attributes to recognize an object. Our ability to perceive an
object is determined not only by the object itself, but also by the context how it occurs (young lady – old lady
example).
4. Attention is the next part of the perception process, in which we focus our attention on certain incoming
sensory information. Since we can’t tune in to each and every one of the thousands of messages and images
we’re exposed to daily, we tend to only pay attention to information that we perceive to meet our needs or
interests. Since we can’t tune in to each and every one of the thousands of messages and images we’re
exposed to daily, we tend to only pay attention to information that we perceive to meet our needs or interests.
This type of selective attention can help us meet instrumental needs and get things done. Selective retention:
people will forget much of what they learn. They tend to retain information that supports their attitudes and
beliefs. Selective distortion: even noted stimuli do not always come across in the intended way, each person
fits information into existing mindset. Selective distortion describes the tendency of people to adapt
information to personal meanings – misinterpretation.
5. A fundamental process of perception is sensory adaptation (habituation) — a decreased sensitivity to a
stimulus after prolonged and constant exposure. When you step into a swimming pool, the water initially feels
cold, but after a while you stop noticing it.
External factors: intensity and size (truck in city and truck in peaceful place), position (upper part of the
magazine gains more attention), contrast (big – small, etc.), novelty (anything that is different, attracts more
attention), repetition, movement. Internal factors: interests (two people`s perception of the situation may be
completely different because of their differing interests), needs (if we are hungry, we will most likely attend to
food stimuli) and expectations (Kelly`s aroused warm-substitute and cold substitute teacher).
22. Describe the factors influencing attention. How can knowledge of these factors be of assistance to the
Advertising Manager of a company selling baby shampoo?
External factors: intensity and size (truck in city and truck in peaceful place), position (upper part of the
magazine gains more attention), contrast (big – small, etc.), novelty (anything that is different, attracts more
attention), repetition, movement. Internal factors: interests (two people`s perception of the situation may be
completely different because of their differing interests), needs (if we are hungry, we will most likely attend to
food stimuli) and expectations (Kelly`s aroused warm-substitute and cold substitute teacher).
External factors: intensity and size (mid-sized, no rough edgy shaped packaging), position (not too high on the
shelf, not too low, in order to be easily reachable for young mothers, baby`s face positioned on the upper,
easily noticeable part of the packaging), contrast (use warm colours, e.g. light blue, pink, light yellow, etc.),
novelty (unique packaging), diversify (offer girl and boy shampoo and perceive with an air refresher hidden
behind the products to awake the senses.

2. “Motivation is an important aspect in every company”. Support this statement and elaborate on one
Motivation Theory
The motivation for achievement is of importance to the marketer who wishes to motivate his staff to a high
level of performance. It suggests that careful consideration should be given to the identification of work targets
so that they provide the achievement-motivated individual with sufficient challenge and opportunity for
satisfaction.
According to McClelland people can be classified into two groups: those that have high need to achieve and are
challenged by the opportunity to succeed; and those who have little or no ambition to be successful. People
with high need to achieve tend to learn faster and make decisions more quickly than those with low
achievement motivation. It is important though, for people with high achievement motivation that they receive
feedback on the results of their effort, because without this, they are unable to derive satisfaction for these
efforts – McClelland`s Theory of Need Achievement.

3. What do Maslow and Freud contribute to explaining the message used and motivational factors in the target
market?
Maslow posited that human behaviour and decision-making are motivated by one of the five need levels in his
hierarchy. Applied to marketing theory, your ability to effectively appeal to one of these motivational drivers is
a key determinant of your potential success. Non-essential services – massage treatments or custom tailoring,
for example – may be marketed successfully to those in the fourth or fifth level of Maslow's hierarchy because
those people are driven by the needs for increased self-esteem and realizing their full potential. The same
marketing campaign is unlikely to appeal to those on the first level, as they are driven by the most basic of
human needs: food, water and other elements of survival. A prospective customer driven by Maslow's second
needs level, safety and security, might be enticed to buy a new car if you convince him that it is safe for his
family, reliable and well-rated in consumer studies. Someone driven by the need for self-esteem, in needs level
four, is looking for recognition and validation, so you might tailor your marketing to convince her that acquiring
and implementing your accounting methods will bring accolades from her peers or make her look good to her
boss.
Maslow's basic principles linking marketing to human psychology remain valid. You connect best with
prospective customers if you appeal to their needs in a relevant, meaningful way. Consider the level of need
your customer is trying to meet, and market your product in such a way as to convince him that it will fulfil
exactly that need. Perform periodic evaluations of your marketing techniques because your target audience
may not remain static.
Always be aware of where on Maslow's needs hierarchy your customer base is and where your product fits in.
The more these two connect, the more effective your marketing efforts are.
Freudian Motivation Theory Put to Use: When companies want to gauge the probability of success for a new
product, they will enlist market researchers to uncover the hidden motivations of a selected group of
consumers to determine what might trigger their buying habits. They may utilize a number of techniques to
discover such deeper meanings, such as role-playing, picture interpretation, sentence completion, or word
association, among others. Such exercises can help researchers learn about how consumers react to products
and how to best market them as a result. For example, buying a particular brand of computer can make a
person feel smart, successful, productive, and prestigious. Marketers can use this information to cultivate
brand identity.
4. What is meant by motivational conflict, and what relevance does it have for marketing managers?
Most behaviours, including purchase and use, are subject to multiple motives, and there are many situations
where these motives come in conflict with each other. Three types: When confronted with two equally
attractive choices, consumers may be caught in an approach/approach conflict (being in a restaurant and
choosing between 2-3 dishes that you like), until choice is made, it is not possible to move forward.
Approach/avoidance is when a desired goal also has negative consequences (e.g. response of an employee
whose desire for the higher salary of a promotion is countered by reluctance to take on more responsibility or
to change hours). Two equally undesirable choices trigger an avoidance/avoidance conflict. E.g. an employee
must choose between two unwanted outcomes. This situation occurs in poor economies when management
asks staff to accept salary cuts or work longer hours. By applying principles of motivational conflict theory to
find a resolution, an employer or manager can use company resources to his best advantage. This conflict can
affect consumption patterns and, therefore, is of interest to marketing

5. Explain operant conditioning theory and discuss how it can be used by marketers.
Operant conditioning occurs when a response by the learner is instrumental in producing a reinforcing
stimulus. The response producing the reinforcement becomes stronger, whereas that not reinforced becomes
weaker (Skinner box example with rat). Responses to certain situations are learned, because they result in
need fulfilment. The need that is fulfilled, may be either positive (goal-directed) and negative.
In marketing, when a consumer purchases a particular product and is satisfied, his behaviour will be positively
reinforced and there is a high probability that he will buy the product again, so continuing to obtain satisfaction
from the product, its purchase may become a learned response and brand loyalty will be established. However,
on the other side, if through a manufacturing problem the product does not live up to its claims, the purchase
of the product will be negatively reinforced and the customer may be consciously avoid purchasing it again.
This can create serious problems for the manufacturer concerned as it may be difficult to extinguish a
negatively reinforced response.

6. What are the key differences between operant conditioning classical conditioning?
There are two essential differences between classical and operant conditioning: 1.: classical conditioning
involves unconscious (involuntary) learning, while operant conditioning involves conscious (voluntary intent of
the part of the learner. 2.: in classical conditioning the learner`s responses do not influence the delivery of the
reinforcing stimulus, while in operant conditioning reinforcement is contingent upon a certain response.
Neither classical, nor operant conditioning will persist in the absence of reinforcement and in both cases,
generalization will occur to other similar situations.
The key feature of classical and operant conditioning is that both involve the establishment of an association or
connection between stimulus and response. Sometimes these theories are referred to as “black box” theories
as in their crudest form they assume the individual is not able to influence his/her environment and is,
therefore, open to manipulation by various stimuli.

7. What do we mean by cognitive learning, and how does it differ from the conditioning theory approach to
learning?
The cognitive learning theory is about understanding how the human mind works while people learn. The
theory focuses on how information is processed by the brain, and how learning occurs through that internal
processing of information they receive, rather than simply responding to stimuli from their environment. The
cognitive learning theory is a broad theory used to explain the mental processes
and how they are influenced by both internal and external factors in order to
produce learning in an individual. The theory is credited to Piaget who believed
knowledge is something that is actively constructed by learners based on their
existing cognitive structures. He disagreed with the behaviourist theory which
focuses strictly on observable behaviour. He concentrated more attention to
what went on inside the learner`s head, instead of how they reacted.
The behaviourist approach only studies external observable behaviour that can
be objectively measured. This theory is based on a stimulus and a person`s response to that stimulus.
Behaviourists believe that internal behaviour cannot be studied because internal mental processes cannot be
observed and objectively measured. In other words, we cannot see what happens in a person`s mind, so
therefore, we cannot measure it. However, unlike behaviourism, the cognitive approach believes that internal
 mental processes can be scientifically studied. It focuses on the thought process behind the behaviour.
Cognitive psychologists believe in order to understand behaviour, you have to understand what goes on in the
brain to cause the behaviour. Therefore, the cognitive approach to learning pays more attention to what goes
on inside the learner`s head and focuses on mental processes, rather than just observable behaviour. Changes
in behaviour are observed, but only as an indicator to what is going on in the learner`s brain.

8. How can the principles of (a) classical conditioning theory and (b) instrumental conditioning theory be
applied to the development of marketing strategies?
Classical conditioning and operant conditioning are psychological reactions exploited by advertisers to
convince us to buy their products. In classical conditioning, consumers respond to a stimulus in a particular,
unconscious way – for example, by salivating when they see a picture of delicious food. In operant
conditioning, advertisers try to change consumers' behaviour by using rewards or punishment. For example, by
giving consumers money back after buying a particular product. In classical conditioning, the advertiser
attempts to get consumers to associate their product with a particular feeling or response, in the hope that the
consumer will then buy the product. For example, an ad for a fast food restaurant will usually make the food
look delicious and mouth-watering so that consumers will feel hungry when they watch the ad and want to go
out and buy some of the food. Another example of classical conditioning occurs in ads where you see people
having a good time using a product. Consumers may then associate good feelings and having fun with the
product and may be more likely to buy the product.
Positive Reinforcement: This is a type of operant conditioning in which consumers are rewarded for buying a
product or service. The reward acts to reinforce the behaviour, making the consumer more likely to continue
buying the product. For example, coupons are a form of operant conditioning. Consumers use coupons to buy a
product for money off, then continue to buy the product even when the coupons are no longer available,
because they become conditioned to buying the product. Free offers are another form of operant conditioning.
One operant conditioning strategy is to offer consumers a free sample, then a coupon good for a large
discount, then a coupon for a smaller discount. At the end of this, the consumer may be so used to using the
product that they continue to buy it at full price. Offers such as “Buy 10, get one free” are another form of
operant conditioning.
Negative Reinforcement: This type of operant conditioning may be used to get consumers to stop doing
something. For example, electricity companies may charge more for electricity used during peak hours. This is a
way to get people to use less electricity during peak hours. Salespeople who call at inconvenient times or use
pressure to convince you to buy a product or service are also using negative conditioning. The idea is that you
will buy the product in order to stop the pestering. Another form of negative conditioning is a threat to void a
warranty if the consumer does not use the company's repair and maintenance products. For example, voiding
the warranty of a printer if you do not use the manufacturer's branded ink cartridges.

9. What are some of the major marketing implications of the changing role of women?
The multiple, and often conflicting, roles of women today pose significant challenges for marketers and
researchers. Four major factors which are evident in demographic data -delayed age of marriage, the
decreasing fertility rate, women's employment, and women-headed families - have potential for causing
important changes in women's consumer behaviour. Since higher education is related to delayed marriage,
another implication is that both partners will bring increased financial resources into the initial years of
marriage. This will clearly allow for a more rapid accumulation of a stock of high-quality durable goods as well
as for continued high expenditures on personal consumption goods, services, travel, and leisure pursuits. Since
many women may be delaying the birth of the first child until careers are well established, most of them are
likely to return to the labour force very quickly, if they leave it at all. The resulting segment of well-educated
and affluent two-worker families may choose to spend as little time as possible on activities that represent
merely "custodial care" of the home or the children. Instead, they will try to devote as much time as possible to
activities that provide rewarding family interaction. Products and services which promote interaction between
parents and children that is both enjoyable and intellectually stimulating should be especially attractive. These
factors have both individual and interactive effects. Those who market goods and services to women will be
well advised to look beyond the "outputs" of consumer decision-making -- product and brand choice -- and to
investigate in depth the processes by which those final decisions are made. The life style choices available to
women today are many and varied. Products and services are sought both to implement these life style choices
and to reflect them. Understanding how products and services fit into chosen life styles is a necessity if they are
to be marketed effectively. it seems clear that we should expect to find few major differences in the purchase
of consumer durable goods between families with working and non-working wives. Differences, however, may
 exist in buying behaviour relative to frequently purchased goods and services, which have received less
research attention to date. In developing, as well as marketing, products and services we should look at the
incompatible demands which often result from women's multiple roles. Any working wife or mother could
assure us that these role-incompatible demands are legion. As marketers we should also look more clearly at
the budgetary allocations and decision-making process of non-traditional families, especially the dual-income
and the woman-headed family, two rapidly-growing groups.

10. Analyse and evaluate how families buy through different stages of development and change.
Analysis of changes in the family status has led to the concept of the family life cycle. A concept that can be
easily applied as a market segmentation tool. Identified stages:
- Bachelor stage: young, single people not living at home. Focused are: leisure and finding a suitable spouse. A
high amount of income is spent on clothing, eating out, holidays and leisure durables.
- Newly married couples: expenditure on leisure activities is quite high, focus is on building up a home, this
group has the highest average purchase of durable goods (e.g. furniture and domestic appliances)
- Full nest I: Young married couples with youngest child <6. Saving may be reduced, and there may be
dissatisfaction with the family`s financial position.
- Full nest II: Young married couples with youngest child >=6. Expenditure is heavily influenced by the children.
- Full nest III: older married
- Empty nest I: older married couples with no children living with them – couple will make home improvements
but no luxury items
- Empty nest II: older married couples with no children living at home – household head retired, reduction in
family income, expenditures are health-oriented.
- Solitary survivor I: - in the labour force: expenditure on leisure pursuits and holidays
- Solitary survivor II: - retired: same as above, but in reduced amount

11. What is meant by attention? What determines which stimuli an individual will attend to? How do marketers
utilize this?
Attention is the process by which an individual allocates part of his or her mental activity to a stimulus. There
are two factors that determine which stimuli will focus our attention: external factors (physical characteristics)
and internal factors (motives and expectations).
Physical properties: intensity and size, position, contrast, novelty, repetition and movement. Internal factors
are interest, effort, emotion, organic state, etc.
Advertising material readily habituates and the marketer must constantly find a way to demonstrate how his
product is differentiated from the competitor`s. brand. Design and packaging can be different but often it is
similar to the competition when its placed beside it on the market shelves. Habituation is sometimes useful,
e.g. where a brand leading company`s can use similar packaging to his other product in hope that consumer`s
positive perceptions of the other product will be transferred to that product.
Consumers may evaluate the product through its physical characteristics (smell, size, shape), but sometimes
they are not able to evaluate purely on the physical basis. Sometimes brand preferences are based on non-
product characteristics (bread in a cellophane and waxed paper). Research is needed to identify the indicators
for choice decision used during purchase. Price is often used as one, particularly in the perception of quality.
The marketer must always remember that the perception is not always affected by direct sensory cues but it
can be also influenced by pas experience, learning and attitudes.

12. How does a group differ from a reference group? What criteria are used by marketers to classify groups?
A group is two or more individuals who share a set of norms, values, and beliefs and have certain implicitly or
explicitly defined relations to one another such that their behaviour is interdependent. A reference group is
that group whose presumed perspectives or values are being used by an individual as the basis for his or her
current behaviour.
Criteria used to classify:
(1) membership: One is either a Member or No-Member.
(2) strength of social tie: friends, close acquaintances, etc.
(3) type of contact: larger groups generally have less contact, primary groups (e.g. families) have generally
frequent interpersonal contact; secondary groups have generally limited interpersonal contacts.
 (4) attraction: refers to the degree of desirability by a member to be associated with a group. Attraction can be
either Positive or Negative and applies to either Members or Non-members.

13. Discuss three main ways in which customer satisfaction can be measured.
1: Use Customer Surveys: To get accurate feedback and actionable items for customer satisfaction, survey your
customers soon after the utilization of the service. There are different ways by which an organization can
conduct customer surveys: In-app surveys, Online surveys, In-store surveys, Feedback forms, Offline surveys
over the phone or SMS. By integrating a contact centre technology with a feedback tool, organizations can
record surveys that ask customers to rate their services. Remember that your customers are very busy, and
most of them hesitate to fill in surveys as it takes their precious time. To counter this, your surveys should be
crisp and specific.
2: Measure Customer Satisfaction Score: The Customer satisfaction score measures the short-term happiness
of your customers. The scale typically ranges from highly unsatisfied to highly satisfied:
Highly unsatisfied – Unsatisfied – Neutral – Satisfied - Highly satisfied
The above scale asks the customers to rate the service received from 1–5, where 1 represents customers who
are highly unsatisfied and 5 represents customers who are highly satisfied. Some businesses increase the scale
to 7 or even 10 to record more accurate results from their customers. Once the score is collected from the
desired number of customers, the average number received is the CSAT score you can relate to. A higher CSAT
score means higher customer satisfaction. But it has a limitation, as it only measures the recent transaction
with the business. To measure the wider relationship let's drill down further.
3: Measure Net Promoter Score: Imagine a situation where your customers are satisfied with your offerings
but are not ready to recommend your business to friends. Such a situation arises when they are not sure of
your longevity to keep them happy. To measure results and track customer loyalty, Net Promoter Score (NPS)
was introduced. NPS measures the probability of a customer referring your business to someone. Thus it does
not measure the short-term happiness as the customer is bound to think about the service provided to them
over a time period and refer to a friend only in case of consistency. Thus, a simple question under NPS would
look like:
Will you recommend us to your friends?
0–6 (Not a chance) - detractors
7–8 (Maybe)
9–10 (Very Likely) - promoters
To calculate NPS, just subtract the percentage of detractors from the percentage of promoters.
A high percentage means that your customers have developed a sense of loyalty towards your brand and are
ready to take you places, but a low percentage would mean that your customers believe you lack consistency
to keep them happy.

14. Does subliminal advertising work. Support your view.

Subliminal messages in advertising are designed to engage people subconsciously. These ads use various
colours, shapes, and words that enable customers to make small but powerful associations between a brand
and an intended meaning. In short, be subtle. And advertisements have a long history of being subtle. Whether
they're hiding a double-meaning in a logo or working some Photoshop magic, subliminal ads definitely meet
the criteria of clever. And the more clever the ad, the better we feel about "getting" it -- and the better we feel
about the product.
- A subliminal message can be found in the FedEx logo. Whitespace in the logo
clearly shows an arrow -- an
indication of the company's speed
and ability to get your delivery from
Point A to Point B.
- T h i s i s s u b l i m i n a l m
responded with the image on the right. Pepsi's original ad is subliminal in that
it makes the viewer think and chuckle a bit: it's funny to suggest that getting a
Coke when you wanted a Pepsi is scary. Coca-Cola's response is perfect, as well, and becomes a great learning
tool: sometimes, the tagline really does make the image.

15. Compare and contrast the economic, passive, cognitive, and emotional models of consumer decision making.
 1. The economic model portrays consumers as making rational choices. Clearly, this model isn't characteristic
of most consumption things as a result of consumers are seldom aware and knowledgeable of all the product
alternatives in any given state of affairs, and of all the options and benefits of the merchandise earrings they
will choose between. Thus, they're usually unable to formational choices. within the study of client behaviour,
the economic man model is commonly rejected as too idealistic and oversimplified.
2. The passive model depicts the buyer as primarily submissive to the selfish interests and promotional efforts
of merchant. consumers are perceived as impulsive and irrational purchasers, able to yield to the arms and
aims of marketers. a minimum of to a point, the passive model of the buyer was signed to by the hard-driving
super salesmen of recent, who were trained to treat the buyer as associate degree object to be manipulated.
3. The psychological (cognitive) feature model depicts shoppers as drawback solvers, wherever consumers
cognitively method info, search out product and services that fulfil their desires, kind preferences, build
decisions, and interact in post-purchase evaluations of their alternatives.
4. The emotional Model: some consumers make purchases based on emotions like joy, love, fear or hope.
Many hope to preserve a sense of the past. Small businesses need to determine what emotional connection
their target market has to their products and build their promotional programs around it.

16. How can a marketer use knowledge of reference group influence to develop advertising strategies?
Identifying and using reference groups in marketing are important because reference groups influence the
attitudes, goals, aspirations, opinions, and information that determine customer standards and expectations
regarding your business and your products or services. Understanding reference groups, and how they
influence your target customers, will enable you to fine-tune your marketing messages and appropriately
package the messages for delivery via the customer’s preferred platforms.
Knowing the reference groups of your best customers and target audience provides a wealth of information
about the kind of information prospects will want or need at each stage of the purchase journey, as well as
how to shape the messaging and how to package the data. It might also provide insight into where prospects
are most likely to want to find information.
It takes time to gather sufficient information to classify reference groups of customers and prospects. Choosing
the right people to appear in ads or to provide endorsements can be tricky – particularly if the person is known
to hold an opinion at odds with a critical value held by your prospect. However, when you have the necessary
information, your marketing team can craft very powerful marketing messages that strike the right chord with
your target audience.
Using reference groups in marketing can be done by a business of any size, in any industry or sector. Reference
groups can help you develop powerful marketing programs that deliver the right message in the right
packaging at the right time in the right place. Before you launch a campaign based on reference groups, it will
be important to test it with representatives of the target market. Testing will ensure a match with the values,
tastes, opinions, and behaviours of the group.

17. What is meant by impulse purchase? Why is it important to marketers?

Impulsive buying is the tendency of a customer to buy goods and services without planning in advance. And
with little regard to the consequences what we are buying. When a customer takes such buying decisions at
the spur of the moment, it is usually triggered by emotions and feelings. Four types of impulse purchase are
identified: 1. Accelerator impulse (consumers are motivated to stockpile for future need), 2. Compensatory
impulse (purchase as a reward for success or failure), 3. Breakthrough impulse (a sudden need to purchase,
triggered by an issue or problem) and 4. Blind impulse (“just have to have it” – no rational explanation).
Revenue can be increased by targeting impulse buyers. If someone buys a magazine or a candy bar while
standing in line at a grocery store, that counts as an impulse purchase. But that’s really nothing to get excited
over. Consider this, however: 54% of consumers have spent more than $100 on an impulse purchase, and 20%
have spent over $1,000. Those are the numbers that can motivate marketers and retailers. Impulse buyers
aren’t hard to find, but you need to position your brand, products, and marketing campaigns accordingly to
encourage these people to spend more money: marketers need to understand the psychological characteristics
of impulsive consumers (younger generations are more likely to make an impulsive purchase), focus on the
right products (you have to figure out what products you want to entice people to buy), create FOMO (fear of
missing out): Promotional campaigns are a great way to target impulsive shoppers. Discounts, deals, and
coupons available only for a limited time might do the trick. Create a sense of urgency by saying there is a
limited quantity remaining; learn how to place items strategically (placement is key for both brick-and-mortar
stores as well as ecommerce sites), simplify the buying process (once someone decides to make an impulse
purchase, you don’t want to give them any chance to change their mind, the buying process needs to be as fast
 and easy as possible) and provide ease of access to customer support (great customer service can help drive a
sale, especially for an impulse buyer, but your company needs to provide the consumer with easy access to a
customer service representative, if you have a retail store, make sure your staff are properly trained to assist
customers while they are walking through your store.

18. Assess the effectiveness of the customization of promotions for both internet and conventional stores sales.
(1) optimization procedures lead to substantial profit improvements over the current practice for all types of
promotions (customized and undifferentiated); (2) loyalty promotions are more profitable in online stores than
in offline stores, while the opposite holds for competitive promotions; (3) the incremental payoff of individual-
level over segment- and mass market—level customized promotions is small in general, especially in offline
stores; (4) for categories that are promotion sensitive, individual-level customized promotions can lead to a
meaningful profit increase over segment- and mass market—level customized promotions in online stores; and
(5) low redemption rates are a major impediment to the success of customized promotions in offline stores.
Optimal undifferentiated promotions should be the primary promotion program in this channel, and firms can
benefit from offering a combination of optimal undifferentiated and customized promotions for suitable
categories in offline stores.

19. What is happening to male and female gender roles?

Gaining an understanding of how gender differences influence purchase decisions and recognizing gender-
specific tendencies (not stereotypes!) is important for any business that sells to people – and wants to do so
more effectively. Men’s motives for shopping appear to be more utilitarian (The conscious pursuit of an
intended consequence. Essentially, meaning you’re shopping “to get something done”), whereas women’s
shopping motives tend to be hedonic (Related to intrinsic and emotional responses. In other words, you’re
shopping because you love it). Women prefer the hunt, men want a quick and effortless process; AND Women
make decisions on a more emotional level, whereas men approach decision-making with facts and data, men
and women differ dramatically in their strategies for information processing and decision-making. Men are
loyal to brands, women are loyal to good service: this means that when advertising to women, it is important
to use marketing to build a personal relationship with female customers while when marketing to men, you
should highlight the advantages and benefits of your products.
Good customer service? Woman want to feel important; men want to get out fast - For men, good services
mean helping them find the right item and helping them get through checkout quickly. For women, customer
satisfaction is strongly linked to a shop’s willingness to share expert advice (demonstrate familiarity with the
product) and the shop’s ability to help them determine which products suit best. What’s the best way to target
male and female shoppers? - Women are more likely to respond to email marketing, so reach them this way.
Educate, empower and provide reassurance. And, remember, they’ll be checking their emails during lunchtime.
Include coupons or discount codes to fulfil their desire to find the best bargain. With men, it’s advisable to
invest in paid advertising so that your product appears when they are searching for something similar.
Conclusion: In a world where personalization is key, businesses have to keep in mind which gender they are
targeting. The fashion industry was first to recognize and respond to men and women shopping differently. By
considering the distinctive differences between male and female online shoppers, you (even if you are not in
the fashion industry) will be able to effectively enhance customer engagement, conversion, and loyalty.

20. a) What is self-concept? What are the four types of self-concept?

The term self-concept is a general term used to refer to how someone thinks about, evaluates or perceives
themselves. To be aware of oneself is to have a concept of oneself. Four Types:
Actual self-concept - who I am now?
Social self-concept - how I am seen by others/ how I would like to be seen by others?
Private self-concept - how I am or would like to be to myself?
Ideal self-concept - who I would like to be?
b) How do marketers use insights about self-concept?
Marketers attempt to create product images that are consistent with the self-concept of their target market.
The idea of multiple selves is important for marketers, especially in terms of understanding consumer`s
aspirations and ideals of who they want to be, as much as their ideas of who they do not want to be.

21. Explain how advertising can influence people’s choices of goods.

 There is no denying that the influence of advertisements on society and the people in it has been profound. It
continues to make advertising one of the most fascinating and talked-about fields of the 21st century. Media
guarantees that people will be exposed to a deluge of various advertising messages, even if the recipients are
only passive viewers and listeners. In the 70`s people saw 500 ads per day (mostly on TV), but since then a
greater number of media outlets is available at people's fingertips and this has risen to 10000 different types of
ads depending on the demographic factors.
A quick look at a group of advertisements will show that they use similar language. Many advertisements are
direct response advertisements, which are ads designed to make the viewer take a specific action now. Words
and phrases often used in direct response ads include: Buy now Book now Click here Get started Try now…
Specifically, the portion of an ad that pushes for an immediate action is called the call to action. The call to
action is a critical component of any ad because it drives the viewer to take action. A call to action only works
when the ad’s viewer feels that taking action is in her best interest, which a company can achieve by using
persuasive language in the rest of the advertisement. Another effect of advertising is educating consumers
about specific products and services. This can be part of the persuasion written into an ad. A consumer cannot
know that buying a product is in his best interest if he does not understand the product. At its core, the
influence of advertising in everyday life is the power to alter what consumers think and feel. A successful ad
cultivates desire within the viewer and makes her want to buy a product while minimizing any doubts she has
about the product. Beyond how advertising influences consumer behaviour, advertising can make shopping
easier: a specific product lets consumers know that a retailer carries that product and that they can go there to
purchase it. Effective advertising does not just tell consumers what they will pay for a product, but it also
communicates how the price they will pay relates to the product’s value, often showing them that they are
saving money by making a purchase.

22. Explain the multi-attribute models of attitudes. How can a marketer use the models to change consumer
attitudes?
Attitudes are an expression of inner feelings that reflect whether a person is favourably or unfavourably
predisposed to some "object". The multi-attribute attitude models state that a consumer’s attitude towards an
attitude object (product/service offering, brand, elements of the marketing mix) is a function of a consumer’s
perception and belief of the key attributes as well as his assessment of the key attributes. It has three
elements:
a) The Attitude-towards-Object Model: The attitude-toward-object model states that a consumer’s attitudes
towards a product/service offering or a brand, is a function of the presence or absence of certain attributes,
and the corresponding evaluation.
b) The attitude-toward-behaviour model focuses on the individual’s acts of behaviour towards the attitude
object rather than mere affect or feeling towards the object. The premise is that a consumer may have positive
feelings towards an attitude object, but he may have a negative attitude regarding his intention for buying such
a product/service offering. Thus, a positive attitude towards the offering may not necessarily end up as an act
of purchase.
c) The Theory-of-Reasoned-Action Model: The theory of reasoned action model attempts to study the impact
of i) instances of behaviour, and ii) subjective norms
Marketers need to understand attitudes not only towards their products and brands but also towards those of
their competitors. companies engage in brand-tracking exercises examining consumer attitudes towards their
brands and from this try to establish key aspects of the brand attributes that appeal to consumers. If
companies understand how consumers feel about their offering and those of their competitors, they are in a
better position to understand what it is about the product category that is important to consumers and task to
adjust or add new attributes based on this research. Linked to this approach companies may attempt to change
consumer beliefs about their offering.

23. Discuss the reasons why consumers go shopping.

To make our purchases we have to shop whether with major retailer on the Internet or in a local shop or
market. The pleasure we get from shopping and how our motivations and even personalities affect how we
shop are important marketing. The following are personal motives for shopping:
Role playing: Shopping is related to certain roles in society and for some women grocery shopping offered the
opportunity to express their housewife role.
Diversion: shopping can be a recreational activity diversion from everyday life.
Self-gratification: Shopping may offer a compensation for other problems in consumer`s life. Escapism and
reward are part of this type of shopping motivation.
 Learning about new trends: Going around the shops allows people to keep up-to-date with new trends.
Physical activity: this refers to people shopping for physical exercise and indeed there is a trend towards the
shopping mall as a place for exercise.
Sensory stimulation: Being bombarded with sights, sounds and smells – for example during Christmas Time.

24. Analyse and evaluate different approaches to explaining the link between attitudes and behaviour.
One of the underlying assumptions about the link between attitudes and behaviour is that of consistency. This
means that we often or usually expect the behaviour of a person to be consistent with the attitudes that they
hold. This is called the principle of consistency. The principle of consistency reflects the idea that people are
rational and attempt to behave rationally at all times and that a person’s behaviour should be consistent with
their attitude(s).
It is assumed that attitudes cause behaviour, but there are other possible relationships (Bohner and Scharwz
2003). Behaviour may not be influenced by attitudes, but by: 1. Values and value systems; 2. Worldviews, 3.
ideology
Another possibility is something else that predicts behaviour like moral norms (an individual's personal
standards of conduct). The individual will perform the behaviour, in this case, because of moral obligation or
conviction. Godin et al preferred the idea of moral norms influencing intention to do the behaviour, which
leads to the behaviour
The relationship between attitudes and behaviour may be mediated by motivational states, or according to
reversal theory, "meta-motivational states". These are four pairs of states that motivate individuals. One pair is
telic (serious-minded) versus paratelic (playful). Individuals can switch between the two versions.

25. What is meant by family decision making? How can different members of the household be involved with
different stages of the decision process?
Family decision making is a concept in marketing & consumer behaviour where an individual decides to buy a
certain product or service after deciding it along with his or her family. Family decision making is a collective
decision by the family, even if the individual is going to buy the product or service entirely with his/her own
money. Every individual has his/her own taste of buying and consumption. This pattern is largely inherited by
the family or the people surrounding the individual. The buying behaviour of the individual depends a lot on
age, gender, location, income and willingness to spend. The family members which comprise of parents,
siblings, grandparents and relatives play a very important role in deciding what to buy and what not to buy.
Information Gatherers – These are the individual who share information about the product of relevance
among the family members. These people have great power as they can selectively transfer information which
they favour and discard any information which are not liked by them, thus playing a crucial role in family
decision making.
Influencers - These people do not have the power to buy things but they have a great power to influence the
decision. For Ex- Children in family can really influence the decision for which movie to watch in movie theatre.
Decision Maker – The decision maker has the power to decide whether to buy or not, what to buy, when to
buy, where to buy, etc.
Purchaser – The purchase is the one which actually purchase the items following the orders to decision maker.
But it can also decide the product in case of unavailability of product or may/may not buy according to his/her
will.
Hence, this concludes the definition of Family Decision Making along with its overview.

26. What is green marketing? What values underlie green marketing?

Green marketing is the marketing of environmentally friendly products and services. It is becoming more
popular as more people become concerned with environmental issues and decide that they want to spend
their money in a way that is kinder to the planet. Green marketing can involve a number of different things,
such as creating an eco-friendly product, using eco-friendly packaging, adopting sustainable business practices,
or focusing marketing efforts on messages that communicate a product’s green benefits.
This type of marketing can be more expensive, but it can also be profitable due to the increasing demand. For
example, products made locally in North America tend to be more expensive than those made overseas using
cheap labour, but they have a much smaller carbon footprint because they don’t have to fly across the globe to
get here. For some consumers and business owners, the environmental benefit outweighs the price difference.
Green marketing is a practice whereby companies seek to go above and beyond traditional marketing by
promoting environmental core values in the hope that consumers will associate these values with their
 company or brand. Engaging in these sustainable activities can lead to creating a new product line that caters
to a new target market. This is also sometimes known as sustainable marketing, environmental marketing or
ecological marketing.

27. What actions do consumers take to avoid post purchase dissonance before the purchase?
Dissonance is “psychologically uncomfortable” and the resulting tension includes the individual to attempt to
reduce the dissonance and achieve more consistency or consonance between the cognitions involved.
Consonance can be achieved in a number of ways:
- The decision can be revoked
- The chosen alternative can be made more attractive by the individual giving attention only to information
supporting its positive features.
- The rejected alternatives can be made less attractive by the individual
- The attitudes and believes can be changed so that they are consistent with behaviour.
For example, a consumer may hold an unfavourable attitude towards a product, but a coupon offer may induce
him to try it. His behaviour in trying the product is inconsistent with the attitude he holds and dissonance
results. By re-evaluating the product, possibly through establishing a cognitive overlap and adopting a positive
attitude towards it, the individual achieves consonance; that is attitudes and behaviour are now consistent.

28. What is a mood? How does it differ from an emotion? How do moods influence consumption behaviour?
Moods are defined as emotional states that are less intense, transient and short term. They are also described
on a continuum as good or bad, and thus have a positive and negative valence. Emotions are changes in the
body state that impact psychological processes thereby resulting in expression of feelings and observable
behavioural reactions.
Putting consumers in a good mood has many positive implications for increasing the likelihood that they will
buy your product. There are many reasons why this is true:
Positioning and product differentiation: When they are in a good mood, consumers are better able to see
similarities as well as differences among products. In other words, consumers who are in a good mood will be
quicker at recognizing what kind of brand you are within a product category and how you are different from (or
better than) your competitor.
Openness to new products: People who are in a good mood tend to be more receptive to new products. This
fact is really important to marketers who are selling innovations, because it implies that consumers will be
more likely to think about and give their products a chance.
Risk-taking: Similarly, good moods can encourage purchase because consumers tend to be more willing to take
risks.
Impulsive buying: Even if the product is not new, putting consumers in a good mood can affect purchase.
Consumers in a good mood buy more impulsively than consumers in neutral or negative moods (more likely for
a small-ticket item).
Favourable brand attitudes: But even if they don't encourage impulse purchase, good moods can have other
benefits. Consumers tend to like a whole range of things—products, ads, salespeople, brands—when they are
in a good mood. Although mood may create only short-term effects on attitudes toward these things,
continuous association of a good mood with a given brand can create more-lasting brand attitudes. In addition,
linking a product with mood-inducing things creates emotional connections to your brand that are harder for
competitors to imitate.

29. What is customer value, and why is it important to marketers?

Customer value is the satisfaction the customer experiences (or expects to experience) by taking a given action
relative to the cost of that action. The given action is traditionally a purchase, but could be a sign-up, a vote or
a visit, while the cost refers to anything a customer must forfeit in order to receive the desired benefit, such as
money, data, time, knowledge.
Marketers should be committed to the proposition that the creation of customer value must be the reason for
the firm’s existence and certainly for its success. That the actual act of delivering customer value should be
considered as a must for both employees as well as employers since customers are one of the most important
possessions any business can acquire. In order to achieve superior customer value any organization must be
able to develop, retain as well as implement competitive advantage. Therefore, a market-oriented culture
provides a solid foundation for these value-creating capabilities, which will greatly enable a business to
consistently deliver superior value to its crucial customers. Market orientation provides a combination purpose
for the efforts and projects of individuals, by this means leading to superior performance. Value driven
 marketing strategies aid organizations in the following areas “understanding customer choices, identifying
customer segments, increasing competitive options, improving service quality, strengthening communications,
focusing on what it is meaningful to customers, and building customer loyalty amongst others.”

30. What is post-purchase dissonance? Give your own examples. Did you go on to buy the same
products/services/brands again? What did you tell others about them?
Post-purchase dissonance is the consumer's dissatisfaction with the purchase of a given product. This
consumer will have to change the market behaviour in relation to this product. e.g. by buying a new,
alternative good. The post-purchase dissonance does not have to be caused solely by doubts about the product
or service purchased. The post-purchase dissonance phenomenon may also result from obtaining incomplete
or incorrect information about a given product or service.
Example of the gimbal purchase on Instagram.

31. What are the characteristics of Opinion Leaders and why are they useful in Marketing Campaigns?
Opinion leaders are the influencers of their respective niches. They influence the choices and beliefs of their
followers towards or against a specific brand, product or service.
- They are knowledgeable in their field.
- They are respected and trusted by their followers.
- Their views carry weight and significance.
- They interpret the media messages and put them into context for the wider population.
- They have a giving spirit and often share their knowledge with the followers on social media.
Opinion leaders who don’t have an affiliation with the product they’re promoting are even trusted more than
the people who do. If the opinion leader is within your family or friend circle, you tend to believe him more
than anyone else as you feel that they have your best interests in mind and want you to make the right choice.
True opinion leaders have a strong impact on their audience’s choices and have a higher social status among
their friends, family, and followers.
With an average person witnessing around 10,000 advertisements each day and not recalling even a fraction of
those, opinion leaders have evidently become very important when it comes to the marketing of a product.
pinion leadership has even become a profession in this era of the internet. These professional opinion leaders
(also called influencers) put in efforts to constantly improve their judging skills by following a particular topic
closely, getting hands-on experience with various products of their area of interest. During their journey to
expertise, they garner enough audience and followers. They have their own personal brand and can build or
shatter any brand just by their words. Customers prefer engagement, interaction and a sort of physical touch
over distant advertisement messages. This is where opinion leaders make a world of difference. They talk to
the target audience.

32. Explain the role of formal and informal groups in an organization.

Formal groups are created to achieve organisational objectives; this is achieved through co-ordinating the work
load. Individuals are brought together by defining their role within the organisations structure. The nature of
the tasks is predominant to the group; this formal structure reinforces the organisation’s culture and control
systems. When there is a business need for a specific task to be completed, groups can be formed to
accomplish this. These groups can have a time limit placed on them from the start. Informal groups are formed
by personal preferences, and satisfy psychological and social needs. A lack of official information will quickly
reveal informal groups within an organisation. The grape vine will pass information swiftly through the
organisation. This cuts through the organisation’s structure ignoring the formal channels of communication.
The group members are spread across departments; they might be friends who do lunch, or smokers who meet
outside the building. This networking is informal, and can benefit the individual member; each group has its
own culture. These groups are cross sectional, and are formed without any involvement from the formal
structure.

33. Explain the Theory developed by Ivan Pavlov. Explain its importance to marketing.
Pavlovian theory is a learning procedure that involves pairing a stimulus with a conditioned response. In the
famous experiments that Ivan Pavlov conducted with his dogs, Pavlov found that objects or events could
trigger a conditioned response. The experiments began with Pavlov demonstrating how the presence of a bowl
of dog food (stimulus) would trigger an unconditioned response (salivation). Pavlov then designed an
experiment using a bell as a neutral stimulus. As he gave food to the dogs, he rang the bell. Then, after
 repeating this procedure, he tried ringing the bell without providing food to the dogs. On its own, an increase
in salivation occurred. The result of the experiment was a new conditioned response in the dogs. Pavlov’s
theory later developed into classical conditioning, which refers to learning that associates an unconditioned
stimulus that already results in a response (such as a reflex) with a new, conditioned stimulus. As a result, the
new stimulus brings about the same response.
A simple application of Pavlovian theory is the response that some consumers have when they hear the word
“sale.” It can generate an urge to shop, even if people have no specific need at the time. The theory can also
work with specific brands. A consumer may start associating a brand name or product with a certain perception
after repeated marketing efforts and/or experience with the brand or product. For instance, many people
associate the brand name Neutrogena with purity and clear skin. Consumer behaviour is a constantly evolving
science. With this knowledge, marketing professionals can be more effective in reaching their audience and
bringing value to employers.

34. What is the role of emotion in the consumer decision process?

Most people believe that the choices they make result from a rational analysis of available alternatives. In
reality, however, emotions greatly influence and, in many cases, even determine our decisions. The influential
role of emotion in consumer behaviour is well documented:
- Functional magnetic resonance imaging (fMRI) shows that when evaluating brands, consumers primarily use
emotions (personal feelings and experiences), rather than information (brand attributes, features, and facts).
- Advertising research reveals that the consumer's emotional response to an ad has a far greater influence on
their reported intent to buy a product than does the ad’s content—by a factor of 3-to-1 for television
commercials and 2-to-1 for print ads.
- Research conducted by the Advertising Research Foundation concluded that “likeability” is the measure
most predictive of whether an advertisement will increase a brand’s sales.
- Studies show that positive emotions toward a brand have a far greater influence on consumer loyalty than
trust and other judgments, which are based on a brand’s attributes.
Emotions are the primary reason why consumers prefer brand-name products. After all, many of the products
we buy are available as generic and store brands with the same ingredients and at cheaper prices. An
understanding of consumer purchase behaviour must be based on knowledge of human emotion and include
the paramount influence that emotions have on decision-making.

35. Why are consumers’ needs and goals constantly changing? What factors influence the formation of new
goals?
The needs and goals of consumers change simply because life and its demands are constantly changing.
Consumers often find themselves in a new or unexpected situation, and therefore must alter their goals in
order to effectively adapt. Additionally, the goods and services available to consumers are always changing,
leading to new opportunities for consumers and inevitably some will pursue them. The economic environment
can also change needs and goals, as the financial situation of the consumer changes.
Globalization is one ongoing phenomenon that has led to the goals and needs of consumers changing. With the
development of the Internet, buyers and sellers gain access to a wider worldwide market. This expands the
range of goods and services available to customers, and can lower the prices of goods as information to all
parties improves. What's more, as globalization causes countries to become more interlinked, trading
opportunities increase along with job opportunities. Consumers may alter their career goals because of this if
they see a potential job opportunity has become available in another country of the world.
The nature of the human being itself could be one element that causes the needs and goals of consumers to
constantly change. The human mind is adapted to making short term survival decisions, even though most
people do try to plan for the long run. People often easily change their minds; it could be said that the nature
of the human is very fickle. The challenge of the seller is to provide for the consumer taking into consideration
the fact that consumer opinions can quickly change.

36. What do we mean by lifestyle? What factors determine and influence lifestyles?
Lifestyle refers to the way consumers live and spend their time and money. It is determined by one`s past
experiences, innate characteristics and life situations. Lifestyle of a person involves his consumption pattern,
his behaviour in the market place, practices, habits, conventional way of doing things, allocation of income and
reasoned actions. It reflects the individual`s attitudes, values, interests and his view towards the society.
 Lifestyle of a person is typically influenced by his/her needs, wants and motivations and also by external factors
such as age, income, occupation, family, culture, education, reference group, social class and buying power.
Any change in one of these factors leads to a change in the behaviour of the consumer.

37. What is meant by exposure? What determines which stimuli an individual will be exposed to? How do
marketers utilize this knowledge?
Exposure is the process by which the consumer comes in physical contact with a stimulus. Exposure is linked to
physical positioning, and this can be managed by marketing and advertising (case with ANAR, the Spanish child
abuse org; also hiding chocolate between cat food won`t be exposed).
Marketers are now attempting a wide variety of tactics to increase stimulus exposure, particularly since
consumers` exposure to marketing stimuli is selective. These efforts are important as consumers now engage in
behaviours that interfere with exposure like zipping (fast forwarding through a videotaped program), zapping
(switching channels during commercials), and flipping (switching channels even when there is no commercial).
Among those efforts that marketers are, using is road blocking - placing the same ads on multiple channels
simultaneously.
38. What is post-purchase dissonance? What characteristics of a purchase situation are likely to contribute to
post-purchase dissonance?
Post Purchase Dissonance is when the customer’s state of the mind and perception is quite uneasy after
purchasing the product or service offering of the brand. This results in the customer either regretting the brand
or in returning the product back from where he purchased.
There could be many reasons for Post purchase dissonance leaving the customer unsatisfied or uneasy about
the purchase.
- He thinks that he has overpaid for the product that he has purchased.
- He has realized that the competitor’s product is far better in terms of price, features, and attributes as
compared to the brand’s product.
- There is a disparity between his prior evaluation of the product and his final purchase. So he doesn’t want
the product anymore.
- Maybe it was an Impulse purchase and the customer regrets the impulse.
One of the major reasons behind this regret after the purchase is the evolving tastes and preferences of the
customer and the growing competition in the market.

39. What are virtual groups? Why do consumers participate in virtual groups and what are the implications for
marketers?
Virtual communities represent a new type of social formation on the Internet. They expand the power of
technology to connect individuals by providing unprecedented opportunities of social interaction and
relationships development among people with shared interests irrespective of geography and time. It has been
estimated that 84% of US Internet users (close to 100 million people) belong to virtual communities, including
professional associations, hobby groups, political organizations, and entertainment communities. The interest
of marketing professionals and scholars in virtual communities is caused primarily by their potential to affect
sales by spreading electronic word of mouth, serving as self-selected highly specialized target markets, and
being valuable sources of information about trends, preferences, and new product ideas. Other possible effects
of virtual communities are related to their social nature, and include adding interactivity to electronic
storefronts to increase their attraction to recreational shoppers, and serving as reference groups that can
influence their members` shopping preferences.

40. How should marketers promote products and services to working women? What appeals should they use?
Explain.
Some basic conclusions about gender differences, including:
Males are more self-oriented, whereas females are more other-oriented; females are more cautious
responders; Females are more responsive to negative data; Males process data more selectively and females
more comprehensively. When the husband is the primary or sole breadwinner, household spending decisions
divide roughly equally. He makes about a third of them, she makes a third, and they make a third jointly.
However, it’s increasingly common for the wife to command a higher salary than the husband; almost 40
percent of married working women bring in more than their partner. To market to working women the
marketers should use the following techniques:
 - Promote that the product is convenient to use and pragmatic as working women are very busy and have to
manage their family and career needs.
- Product helps in multi-tasking and increases efficiency.
- Give the option of ordering online and home delivery
- Give the opportunity to customize the package according to the unique need of each woman.
- They often get paid lesser than their male counterparts so keep the products in an affordable range.
- Offer free trials as they will learn to trust when they have experienced the product themselves.
- Where she works can also be the contact point and when she sees her colleagues using the product, she will
look at it more favourably.

41. What factors determine the degree of influence a reference group will have on a given consumer decision?
- Information and experience: an individual who has first-hand experience with a product or service, or can
easily obtain full information about it, is less likely to be influenced by the advice of example of others. On the
other hand, a person who has little or no experience with a product or service and does not expect to have
access to objective information about it is more likely to seek out the advice or example of others.
- Credibility, attractiveness and power of the reference group: a reference group that is perceived as
credible, attractive, or powerful can induce consumer attitude and behaviour change. When consumers are
primarily concerned with the acceptance or approval of others they like, with whom they identify, or who offer
them status or other benefits, they are likely to adopt their product, brand, or other behavioural
characteristics. When consumers are primarily concerned with the power that a person or group can exert
over them, they might choose products or services that conform to the norms of that person or group in order
to avoid ridicule or punishment.
- Conspicuousness of the product: the potential influence of a reference group on a purchase decision varies
according to how visually or verbally conspicuous the product is to others. A visually conspicuous product is
one that wills standout and is noticed; a verbally conspicuous product may be highly interesting, or it may be
easily described to others. Products that are especially conspicuous and status revealing are most likely to be
purchased with an eye to the reactions of relevant others.

42. Explain the different types of purchase decisions that consumers have to make.
Behind apparently simple decisions, there are a range of thought processes which impact decision-making. For
instance, a buyer may decide at the “spur of the moment”, based on emotion, or he may make a researched,
and well-thought out decisions. Based on this observation, we can see that different processes exist for
decision-making. There are three types of consumer decisions to consider:
1. Nominal: often made about low-cost products. They include frequent purchases, purchases from a familiar
brand or product, buying that requires low involvement, or little search efforts. The important thing to
remember about nominal decision-making, is that too much marketing effort can have a negative impact on
your customers. If someone is already happy to buy an item on impulse, or because of brand loyalty, they don’t
need constant interaction with the brand asking them what they like about the substance, or whether they
want to change anything. Too much marketing is not only debilitating to your budget, but it can get on your
customer’s nerves – which is a dangerous thing for brands in this highly competitive era.
2. Limited: a little more involved than nominal decision-making, but it’s still not a process that requires in-
depth research. Limited decisions are made about mid-cost products, semi-frequent purchases, or purchases
from a somewhat familiar brand. They require a little involvement, and perhaps some searching. When
customers make limited decisions, they take a small amount of time to ponder over their purchase, but they
might not go online to look for testimonials and reviews. Instead, they could consider their memory of their
product, and make decisions based on logical inferences. When it comes to addressing limited decision-making,
it’s important for marketers and brands to examine their customer data, and understand the factors that
influenced decision-making, such as product quality, product availability, price and packaging style
3. Extended: are made about higher-cost products, and infrequent purchases. They require a lot of
involvement, often centre around unfamiliar brands or products, and need extended thought and search
efforts to ensure buyer confidence. Major purchases come with more risk for the customer, and that means
that there’s more cause to consider things from a deeper perspective. When it comes to influencing extended
decision-making, the best thing that any brand can do is work on building their positive online presence.

43. Explain cognitive dissonance theory and show how marketers can use this theory to inform their activities.
Cognitive Dissonance Theory, developed by Leon Festinger (1957), is concerned with the relationships among
cognitions. According to cognitive dissonance theory, there is a tendency for individuals to seek consistency
among their cognitions (i.e., beliefs, opinions). When there is an inconsistency between attitudes or behaviours
(dissonance), something must change to eliminate the dissonance. In the case of a discrepancy between
attitudes and behaviour, it is most likely that the attitude will change to accommodate the behaviour. Two
factors affect the strength of the dissonance: the number of dissonant beliefs, and the importance attached to
each belief. There are three ways to eliminate dissonance: (1) reduce the importance of the dissonant beliefs,
(2) add more consonant beliefs that outweigh the dissonant beliefs, or (3) change the dissonant beliefs so that
they are no longer inconsistent.
Dissonance occurs most often in situations where an individual must choose between two incompatible beliefs
or actions. The greatest dissonance is created when the two alternatives are equally attractive. Furthermore,
attitude change is more likely in the direction of less incentive since this results in lower dissonance. In this
respect, dissonance theory is contradictory to most behavioural theories which would predict greater attitude
change with increased incentive (i.e., reinforcement).
Influence marketing is often relegated to customer acquisition efforts, yet the need to create advocates and
social proof around a brand necessitates better engagement with existing customers. Identifying cognitive
dissonance in existing customers allows marketers to pinpoint the micro-influencers that may help alleviate the
tension and sway their belief towards a feeling of satisfaction with the purchase and possibly even advocacy.
Left alone, consumers with these feelings may return the product, or worse, turn to social channels to complain
about it. The returns and online negativity can be curbed when true influence marketing techniques are
applied to this consumer segment.