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Consumer Economics
Chapter 7
Decision Making and Advertising
Copyright©2009 Taylor & Francis Group, an informa business
Learning Objectives
Discuss decision making in consumer behavior
Explain three main types of decision making
Understand advertising in relation to buying decisions and sustainable behaivor
Know the pros and cons of advertising in relation to consumers
Describe the government agencies that impact advertising
Understand the value of social marketing and public service announcements
Introduction
Consumers make decisions every day
How consumers make decisions is important
Advertising influences consumer decision making
Decision Making Takes Time
• Decision making is choosing between two or more
alternatives
• Consumers try to make good decisions; but it is
hard to do
• Consumer decisions involve trading time and
money for goods and services
Copyright©2009 Taylor & Francis Group, an informa business
Three Types of Decision Making Styles
Habitual decision making
Extended decision making
Limited decision making
Theory and Style Preference
The role of self-concept
Self-esteem
Rules of thumb
Style
Uniqueness theory
What Affects Consumer Decisions?
Technological Advances
Obsolescence
Impulse buying
Consumerspace
Advertising and Social Influence
Paid communication
First, gain their attention
Many different types of advertising
Placement and timing is important
Advertising is Necessary, but Complex
1. Use of color
2. Repetition
3. Consistency
4. Memory devices
5. Economic pros and cons of advertising
6. Deceptive advertising
7. The subconscious and subliminal advertising
8. Distasteful advertising
9. Infomercials
10.Marketing to children
Government and Advertising
The role of the FTC
Advertising Legislation
Cease-and-desist orders
Counter Advertising
Social Marketing and PSAs
Uses marketing to solve social problems
Social marketing straetgies
Public service announcements
Chapter Summary
Are consumer decisions rational?
Consumers make many complex decisions
A multitude of influences
Advertising plays role
Marketing can hurt and help consumers