International Consumption - Consumers’ perspective

Consumer Behaviour 1

‘Internation Agrifood Economics’ MIBE

Materials 2

Obligatory: slides published on the course website after the lessons (the

only material required for the final exam)

Optional readings (not required for the exam): • Solomon, M. (2006). Consumer behavior: European perspective. Harlow: Pearson Education. • Wilkie, W. (1990). Consumer behavior. New York: John Wiley & Sons • ‘Market Segmentation and Positioning’ at http://www.oup.com/uk/orc/bin/9780199290437/baines_ch06.pdf

Consumer Behaviour 3

Internal Processes

External Processes

Desisive Procesess

Consumer behaviour is the study of when, where, how, why (why not) and who does or does not buy a product.

• It involves elements from psychology , sociology, social antropology and economics; • It attempts to understand the decision making process (individually and in groups) •It studies characteristics of individual consumers such as demographics and behavioural (SEGMENTATION) • It also tries to assess influences on the consumer from groups such as family, friends, reference groups, and society in general;

Consumer Behaviour 4

• Perception • Learning & Memory • Motivation, Values, Involvemen • Attitudes • The self

Internal Processes

External Processes

Desisive Procesess

• group influence, • culture, • opinion leaders

Decisive processes

Perceptual Map 5

The perceptual process 6

Stimulus Sensory Receptors

Attention

Interpretation Reponses Perception

SENSATION

MEA

NIN

G

Refers to response of sensory receptor (5 senses)

The

mean

ing is in

terpreted

by

each p

erson

in an

ind

ividu

al w

ay, thu

s may d

iffer

EXAMPLE: perceptual maps of products or brands presenting in 2D placement of products/brands in psychological space

Sensory Perception 7

Sensory inputs evoke historical imagery, in which events that actually occurred are recalled.

advertising, store design, packaging, product’s size, styling, brightness and

distinctiveness compared with competitors

COLOURS

Sensory Perception 8

Fresh baked bread Pizza

Coffee Chicken

Bring back memories Reduce stress

Jingles Music Sound

1 2 3

Wool & Silk vs Denim

Factor in sales interactions.

Northern Europeans touch less than

southern Europeans

Food companies make sure that their products

taste as they should

• different sweetness / country

• New Coke

Perception - Gestalt 9

Incomplete picture as a whole

group together objects that share similar physical characteristics

one part of a stimulus (the figure) will dominate while other parts recede into the background.

Perception 10

Just Noticibale Difference (JND) – known as Weber’s Law

Symbolism

Signs, icons etc

Learning & Memory 11

When a stimulus (food) that elicits a response (salivation) is paired with a stimulus (a bell) which originally does not elicit a response (salivation) . Over time, this second stimulus (bell) causes

a similar response because it is associated with the first stimulus.

Classical conditioning Operant / instrumental

conditioning

When an individual learns to perform behaviours that produce positive outcomes and

to avoid those that yield negative outcomes.

FIXED INTERVAL REINFORCEMENT

POSITIVE REINFORCEMENT

NEGATIVE REINFORCEMENT

PUNISHMENT

VARIABLE INTERVAL REINFORCEMENT

FIXED RATIO REINFORCEMENT

Sales Promotions 12

Price discounts

Direct ‘20 % off’ ‘50% off’ Coupons issued by the

manufacturers or supermarkets

Discounts via supermarket loyalty cards

Extra-product price promotions

Buy-one-get-one-free Reduced price with-purchase (buy one and get

another at 0,1 Euro / 50% off) Multi-purchase (e.g., three for the price of two)

Collecting

Collecting food labels/beverage container tops in

return for gift

1. significant sales ↑ over the short-term 2. lead to changes in food-consumption patterns 3. Or not (lead to changes in consumption)

1) product testing leading to the consumption of a product not previously consumed, and, therefore, increased consumption 2) increased consumption of the product category

Learning & Memory 13

Cognitive learning occurs as a result of mental processes. In contrast to

behavioural theories of learning, cognitive learning theory stresses the

importance of internal mental processes.

COGNITIVE LEARNING

Motivational Conflicts 14

Approach - Approach by imwearingcons

by The Pizza Review

by gnuf

by johnsu01

Approach - Avoidance

Avoidance - Avoidance by isafmedia

by Charlotte Astrid

1

2

3

4

5

Motivation → Needs 15

Need for affiliation (to be together with

others)

Need for power (to feel supremacy or

matery over the surrounding - cars)

Need for uniqueness (to perform individual

identity)

Motivation → Needs 16

Need for affiliation (to be together with

others)

Need for power (to feel supremacy or

matery over the surrounding - cars)

Need for uniqueness (to perform individual

identity) Physiological (hunger, thirst, sleep)

Safety (protection, security)

Belonging (love, friendship,

acceptance)

Ego needs (prestige, status)

Self actualisation (fullfilment)

Maslows’s hierarchy of needs

Ice cream (to feel like a loved child again), full home baking,

hospital care

Gourmet foods, foreign cars, vodka, perfume

Strategies 17

1) Appeal to the consumers’ hedonic needs (sensory appeal - higher levels of attention)

2) Use novel stimuli, unexpected situation / ending

3) Prominent stimuli (loud music and fast action) in print formats, larger ads increase attention (look longer at coloured

pictures as opposed to black and white)

4) Include celebrity endorsers

5) Involve

ORGANIC

Case Study

• Attituted towards functional food in Finland:

– Reward from using (price, what I get from)

– Necessity (about needs)

– Confidence (trust, lack of trust)

18

In Finland 19

Reward from using FF Confidence in FF

Necessity for FF

Functional foods help to improve my mood

My performance improves when I eat Functional foods

Functional foods make it easier to follow a healthy lifestyle

I can prevent disease by eating functional foods regularly

The idea that I can take care of my health by eating functional foods gives me pleasure

Functional foods can repair the damage caused by an unhealthy diet I am prepared to compromise on the taste of a food if the product is functional I actively seek out information about functional foods

Functional foods are completely unnecessary

It is great that modern technology allows the development of functional foods

The growing number of functional foods on the market is a bad trend for the future

I only want to eat foods that do not have any medicine-like effects Functional foods are consumed mostly by people who have no need for them

It is pointless to add health effects to otherwise unhealthy foods For a healthy person it is worthless to use functional foods

Health effects are not appropriate in delicacies

I believe that functional foods fullfil their promises Functional foods are science-based top products If used in excess, functional foods can be harmful to health

In some cases functional foods may be harmful for healthy people

Using functional foods is completely safe

Thank you Next class : 15/11/11

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