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CHAPTER FIVE
MARKETING AND CONSUMER BEHAVIOR: THE
FOUNDATIONS OF ADVERTISING
OBJECTIVES
The main purpose in this chapter is to underline the importance of the marketing process in
business and to define the role of advertising and other marketing communications tools in
presenting the company and its products to the market. The successful advertising practitioner
must understand the relationship between marketing activities and the way consumers behave. It
is that relationship that ideally shapes effective advertising. (p. 136)
After studying this chapter, your students will be able to:
1. Define marketing and explain the role advertising plays in the larger market context.
2. Discuss the concept of product utility and the relationship between utility and consumer
needs.
3. Identify the key participants in the marketing process.
4. Outline the consumer perception process and explain why advertising people say,
"Perception is everything."
5. Describe the fundamental motives behind consumer purchases.
6. Discuss the various influences on consumer behavior.
7. Explain how advertisers deal with cognitive dissonance.
TEACHING TIPS AND STRATEGIES
This chapter delves into consumer behavior and how advertisers use it to influence
purchasing habits. I suggest using the lecture to convey the importance of PERCEPTION
in advertising.
One of the questions that Maslow’s hierarchy of needs fails to answer is what makes
someone buy something? I ask the class, this very question. The answers vary all over
the place. No differently then if you ask students, “Why are you getting a degree?” I
have heard my parents wanted me to. I want to make more money. My friends are here.
Do you see the problem that advertisers must now deal with. They have to figure out
what the majority of people want and then sell them on that benefit.
There is an old maxim in sales, “Features tell and benefits sell.” If you look at effective
advertising you will usually see this. For instance, if Mercedes is advertising heated
seats, they are more likely to push the heats are always warm (feature). Yet, the (benefit)
is what sells the seats. When it is cold and you walk out to your car, your seats won’t be
cold, like the rest of your car, this means to you…. Do you see the benefits? I
recommend going over with students the different feature and benefit statements for the
ads in this book. This will help students understand that all advertising is trying to create
a position in the mind using feature and benefit statements.
One of the best advertising campaigns I like to share with students is Slick 50 or Dial
Antibacterial soap. Before Slick 50, most consumers didn’t know or didn’t care that the
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first three seconds when someone starts their car is where most engine damage occurs.
Yet, Slick 50 was able to position itself as the lubricant that was going to solve the
problem. Feature: This product will protect your engine. Benefit: This means that your
engine should last longer. See, how without the benefit statement the advertising isn’t as
effective? The results of the advertising, sales took off. After all, even though it was
almost $20.00 for one bottle, wasn’t that cheaper then a new engine?
Dial soap did a similar theme in there advertising campaign. Most Americans, didn’t
know that bacteria was everywhere. Dial created a campaign conveying to consumers
that germs are everywhere and you can get rid of them by using Dial Antibacterial soap.
A new category of soap was created by a simple advertising campaign with bacteria in
mind. Now there are many different products with antibacterial protection. This is good
advertising and marketing working together.
We can have a new product or service that is phenomenal. The challenge is to get
consumers to understand the new product/service to help avoid product/service failure.
That is where advertising comes in.
When I have discussions with students regarding this, they tend to be very surprised.
Many times students believe that advertising is about coming up with the jingle or the
phrase that helps it to stand apart from others. That is a function of advertising, yet a very
small function of advertising.
LECTURE OUTLINE
A5-1 Home.Grocer.com homepage (p. 137)
I.
Introduction (pp. 137-139) — In 1998, the Golden Age of Entrepreneurialism: dot-coms
sprang up by the thousands as people sought to take advantage of new, Internetrelated technologies. HomeGrocer.com, a new e-business set out with a vision of
grocery shopping on-line where people would receive their grocery order the next
day. The new venture received more than $160 million dollars in funding from bigtime investors. HomeGrocer.com expanded in a mater of months from one to three
locations and had a plan toward swift steady growth. HomeGrocer.com lacked one
important thing; a product that appealed to a broad enough customer base to turn a
profit. On June 26, 2000 just 3 months after going public, HomeGrocer.com was sold
to its main rival, Webvan, for $1.1 billion in stock-one year later, after losing $697
million in three years, Webvan also closed its doors. How could this happen? Poor
marketing.
a. Failed to identify its potential customers
b. Lacked a complete understanding of the potential customer’s wants. It was not
just offering a new service. HomeGrocer.com was attempting to change customer
grocery shopping behavior
c. With hungry investors, tight competition and an ever-evolving marketplace,
HomeGrocer.com needed to grow big and needed to do this quickly. Instead of
taking the time needed to foster a change in customer behavior, Homegrocer.com
expanded as quickly as Wall Street dictated.
d. HomeGrocer.com had to charge a fee to provide its service unless orders reached
$75 or move, local grocers had been delivering their food to residents of densely
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II.
populated areas for years with no extra cost. At the time, the majority of
customers were not willing to pay a premium for delivery.
e. In an attempt to speed up the change in customer behavior, HomeGrocer.com. In
2000 it budgeted $120 million in advertising expenditures. This amount far
succeeded companies total sales.
To succeed in business, a company’s top managers must understand the basic principals
of marketing. Specifically, they must understand who their customers are, and they must
listen and respond to their customers’ desires
The Assumption Syndrome
1. You can't assume anything about a market. Respect the importance of marketing
and know how to interpret the data uncovered by research.
2. Even superior advertising can't save a product that isn't marketed correctly.
The Larger Marketing Context of Advertising (p. 139)
Advertisers must understand the relationship between the product and the marketplace –
the province of marketing. Marketing’s role is often misunderstood.
The key to a company’s success is its ability to locate, attract, and keep customers who
are willing and able to pay for the firm’s goods and services. This means being able to
locate prospects and to understand their wants and needs. Then to create need-satisfying
products and communicate their existence to the market.
A. The Relationship of Marketing to Advertising (p. 139)
Marketing is the business process of planning and executing the conception, pricing,
promotion, and distribution of ideas, goods, and services to create exchanges that
satisfy the perceived needs, wants, and objectives of individuals and organizations.
Advertising is just one of the numerous tools used in the promotion or
communication, aspect of marketing.
B. Customer Needs and Product Utility (p. 140)
1. A main element of marketing is its focus on the special relationship between a
customer's needs and the product's problem-solving potential. This is generally
referred to as the product's utility.
2. Utility extends to the product's ability to satisfy both symbolic (or psychological)
wants.
3. Marketers use research to discover what needs and wants exist in the marketplace
and to define a product's general characteristics in the light of economic, social,
and political trends.
4. The goal is to use this information for “product shaping” — designing products,
through manufacturing, repackaging, or advertising, to satisfy more fully the
customer's needs and wants.
Ad Lab 4-A “Understanding Needs and Utility” (pp. 141. 142)
5. Some companies give marketing short shrift, introducing a product without a
clear idea of its utility to the customer, hoping that advertising will move the
product off the shelf.
C. Exchanges, Perception, and Satisfaction (p. 140)
Marketing aims to create exchanges that satisfy the perceived needs, wants and
objective of individuals and organizations. Three important concepts are:
1. Exchanges: The Purpose of Marketing and Advertising (p. 141)
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III.
An exchange—any business transaction in which one person trades something of
value to another person. Exchange is the traditional, theoretical core of
marketing, which facilitates exchanges, increasing the potential for satisfaction. It
does this via advertising, which makes people aware of the availability of
products and their selection alternatives.
2. Perception is Everything (p. 142) — People about to engage in a business
exchange sometimes feel apprehensive, worrying that the exchange may not be
equal — even though it may be more than fair. The perception of inequality is
most likely based on the fact that the customer lacks knowledge about the
product. It is important that the seller reassures the buyer — perhaps through
advertising — that an equal exchange is possible. There must be a perception of
equal-value or the likelihood of an exchange is remote.
a. Two levels of customer perception
1) The perception of the product or service
2) The perception of needs, wants, and objectives
b. Advertisers must first develop customers' perception of the product
(awareness, attitude, interest), and then a perception of its value in satisfying
a want or need (utility). The greater the customer's need, the greater the
potential value or utility of the need-satisfying product.
3. Satisfaction: The Goal of the Customer
The final concept of satisfaction is still an issue after an exchange has occurred.
Customers must be satisfied that their needs are met by their actual use of the
product, or they won't perceive that an equal-value exchange took place.
Advertising reinforces satisfaction by reminding customers why they bought the
product, helping them defend the purchase against skepticism, and enabling them
to persuade other prospects to buy.
The Key Participants in the Marketing Process (p. 143)
A. Customers — the people or organizations who consume products and services. They
fall into three general categories (p. 143):
1. Current customers — those who have already purchased something from a
business and who may purchase on a regular basis
2. Prospective customers — people about to make an exchange or are considering
it.
3. Centers of influence — customers, prospective customers, or opinion leaders
whose opinions and actions others respect.
B. Market (p. 143) — The second participant in the marketing process is the market,
which is simply a group of current customers, prospective customers and
noncustomers who share a common interest, need, or desire; who have money to
spend to satisfy needs or solve problems; and who have the authority to make
expenditure decisions. Does not include everyone (more information in chapter 6)
Companies advertise to four broad classifications of markets:
1. Consumer markets — include people who buy goods and services for their own
use.
2. Business markets (p. 144) — are composed of organizations that buy natural
resources, component products, and services that they resell, use to conduct their
business, or use to manufacture another product. There are severe subtypes of
business markets, the two most important being:
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IV.
a. Reseller markets — buy products for the purpose of reselling them.
b. Industrial markets — buy products used to produce other goods and
services.
3. Government markets — buy products for municipal, state, federal, and other
government activities.
4. Transnational (or global) markets — include any of the other three markets
that are located in foreign countries.
C. Marketers (p. 145) — include every person or organization that has products,
services, or ideas to sell.
Customer Behavior: the Key to Advertising Strategy (p. 145)
A. The Importance of Knowing The Consumer (p. 145)
Advertisers spend a lot of money to keep individuals and groups of individuals
(markets) interested in their products. To succeed, they need to understand what
makes potential customers behave the way they do. Advertisers must study:
1. Consumer behavior — the mental and emotional processes and the physical
activities of people who purchase and use goods and services to satisfy particular
needs and wants.
2. Organizational buyers — the people who purchase products and services for
use in business and government is also very important.
B. Consumer Decision Process: An Overview (p. 146)
Exhibit 5-1 Customer decision process conceptual model (p. 146)
A5-2 (p. 146)
Advertising's primary mission is to reach prospective customers and influence their
awareness, attitudes, and buying behavior. To do this, an advertiser must make the
marketing communications process (discussed in Chapter 1) work very efficiently.
The consumer decision-making process is a rapid evaluation program run by our
mental computers the moment a medium delivers an advertising message to us. The
fundamental building blocks are:
1. Personal processes (p. 147) govern the way we discern raw data (stimuli) and
translate them into feelings, thoughts, beliefs, and actions. These are the
“perception,” the “learning,” and the “motivation processes.”
2. Mental processes and behavior affected by two sets of influences:
a. Interpersonal influences — which includes our family, society, and culture.
b. Nonpersonal influences — factors often outside the consumer's control e.g.,
time, place, and environment.
3. Final step typically requires yet another process, the evaluation of alternatives,
in which we choose brands, sizes, styles, and colors. If we do decide to buy, our
postpurchase evaluation will dramatically affect all our subsequent purchases.
V. Personal Processes in Consumer Behavior (p. 147)
The first task in promoting any new product is to create awareness (perception) that the
product exists.
The second is to provide enough compelling information (learning and persuasion) about
the product for prospective customers to make an informed decision.
Finally, advertising needs to be persuasive enough to stimulate customers' desire
(motivation) to satisfy their needs and wants by trying the product.
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A. The Consumer Perception Process — perception is the personalized way we sense,
interpret, and comprehend stimuli. The perception challenge is the first and greatest
hurdle advertisers face.
Exhibit 5-2 The model of consumer perception process (p. 148)
A5-3 (p. 148)
1. Stimulus is the physical data we receive through out senses.
2. Perceptual Screens — the subconscious filters that shield us from unwanted
messages before any data can be perceived, it must penetrate a set of perceptual
screens.
a. Physiological screens comprise the five senses, detect the incoming data,
and measure the dimension and intensity of the physical stimuli.
b. Psychological screens evaluate, filter and personalize information according
to subjective emotional standards. These screens evaluate data based on:
1) Innate factors, such as the consumer's personality and instinctive human
needs,
2) Learned factors, such as self-concept (the image we have of who we are
and who we want to be), interests, attitudes, beliefs, past experience, and
lifestyle.
3) Selective perception (p. 149) — As over-communicated consumers, we
unconsciously screen out or modify many of the sensations that bombard
us, focusing on some and ignoring others.
3 Cognition — the concept of comprehending the stimuli. Once we detect the
stimulus and allow it through our perceptive screens, we can comprehend and
accept it. Now perception has occurred, and the stimulus reaches the consumer's
reality zone.
4. Mental Files — We store memories in our minds according to a mental filing
system:
a. We rank files by importance, price, quality features, etc.
b. We can easily remember two brand names in a mental file, but find it
difficult to remember more than seven.
c. We resist opening new files.
d. We avoid filing new information that is inconsistent with what is already
filed.
e. Mental files drive the perceptual screens — a major challenge to advertisers.
B. Learning and Persuasion: How Consumers Process Information (p. 151)
Learning is a relatively permanent change in thought process or behavior that occurs
because of a reinforced experience. Like perception, learning works of the mental
files and contributes to them, producing habits and skills.
Persuasion is linked to learning and is a change of belief, attitude, or behavioral
intention is caused by promotional communication (personal selling, advertisement,
etc.).
1. Theories of Learning
a. Cognitive theory – views learning as a mental process of memory, thinking,
and the rational application of knowledge to practical problems – a good
description of how we learn from the experience of others and how we
evaluate complex purchase decisions
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b. Conditioning (stimulus-response) theory treats learning as a trial-and-error
process – the consumer responds to some stimulus; if the consumer’s
response reduces the drive, then satisfaction occurs and the response is
rewarded or reinforced – applicable to simple, basic purchases consumers
make every day.
c. Persuasion occurs when the change in belief or behavior intention is caused
by promotion communication (e.g. advertising).
Exhibit 5-3 simple diagrams of cognitive and conditioning theory (p. 151)
A5-4 (p. 151)
2. The Elaboration Likelihood Model
Exhibit 5-4 The Elaboration Likelihood Model(p. 152)
A5-5 (p. 152)
a. The Elaboration Likelihood Model portrays the two ways promotion
communication can persuade consumers:
1) Central route to persuasion — When consumers are considering an
expensive or complicated product purchase, they have a higher level of
involvement with the product or the message. Under these conditions,
they are motivated to pay attention to the central, product-related
information (such as product attributes, benefits, or positive functional or
psychological consequences. Their higher involvement leads to a more
elaborate level of understanding.
2) Peripheral route to persuasion — consumers with little or no reason to
pay attention to or comprehend the central information of the product or
the related communication will be less likely to pay attention to direct
expression of a central route communication, but will be more likely to
stop and absorb some peripheral aspects of the promotion
communication (actors in a TV commercial, exciting photo in a print ad,
etc.).
b. As most mass advertising is not seen by a majority of people at a given time
and as most ads not very relevant to most people’s goals or needs, most ads
receive peripheral processing.
c. When a product has a distinct advantage, the advertiser’s goal should be to
encourage central route processing by increasing the consumer’s
involvement with the message (e.g., comparative advertising).
c. Repetition can have a positive influence by rekindling memories of
information from prior ads.
3. Learning Produces Attitudes and Interest
a. Attitude — acquired mental position regarding some idea or object; the
positive or negative evaluations, feelings or action tendencies that we learn
and cling to. To advertisers, gaining positive consumer attitudes is critical to
success.
b. Brand interest — an individual's openness or curiosity about a brand. For
mature brands in categories with familiar, frequently purchased products,
brand interest is even more critical for motivating action.
3. Learning Leads to Habits and Brand Loyalty.
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a. Habit — the acquired behavior pattern that becomes nearly or completely
involuntary — is the natural extension of learning. Most consumer behavior
is habitual because it is safe, simple, and essential.
b. Brand loyalty — the consumer's conscious or unconscious decision to
repurchase a brand continually. It occurs because the consumer “perceives”
the brand offers the right product features. The major objective of all brand
marketers is to produce brand loyalty, a direct result of the habit of
repurchasing and the reinforcement of continuous advertising. In the quest
for brand loyalty, advertisers have three aims related to habits:
1) Breaking habits — to get consumers to unlearn an existing purchase
habit to lure them to try a new product.
2) Acquiring habits — to help consumers learn to repurchase their brand
3) Reinforcing habits — to remind current customers of the value of their
purchase and to encourage them to continue purchasing.
5. Learning Defines Needs and Wants (p. 155) — a need may become a want as we
file perceptions. And want leads to motivation.
B. The Consumer Motivation Process (p. 155)
1. Motivation — the underlying drives that contribute to the individual's
purchasing actions stemming from the conscious or unconscious goal of
satisfying our needs and wants:
a. Needs — the basic, often-instinctive, human forces that motivate a person to
do something.
b. Wants — "needs" we learn during our lifetime.
2. To better understand what motivates people, Abraham Maslow developed the
classic model called the hierarchy of Needs — Maslow's theory states that the
lower, physiological and safety needs dominate human behavior and must be
satisfied before the higher, socially acquired needs (or wants) become
meaningful. The highest needs, self-actualization, is the culmination of fulfilling
all the lower needs and reaching to discover the true self. The levels are
identified as:
Exhibit 5-5 hierarchy of needs table of need/product/promotional appeal (p. 155)
A5-6 (p. 155)
a. Physiological needs — base needs; such as, water, food, shelter, etc.
b. Safety needs — avoidance of situations that are unfamiliar, threatening, or
might lead to injury or illness.
c. Social needs — friendship, affection, a sense of belonging.
d. Esteem needs — self-respect, recognition, status, success.
e. Self-actualization — fulfillment of lower needs and knowing one’s true self
(self-fulfillment)
Exhibit 5-6 Rossier and Percy’s eight fundamental purchase and usage
motives (p.156)
A5-7 (p. 156)
3. The promise of satisfying a certain level of need is the basic promotional appeal
for most ads. Ad campaigns often portray the fulfillment of social, esteem, and
self-actualization needs, and many offer the reward of satisfaction through
personal achievement. The level of need to be fulfilled by the consumer must be
expressed directly or indirectly in the ad to achieve the highest possible success.
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VI.
4. Motivation — To be motivated, a consumer must first have a chosen goal.
Typically, a consumer first evaluates the need (and the product’s utility to resolve
the need) and either accepts or rejects the product or need as being worthy of
action.
a. Acceptance converts satisfaction of the need into a goal, which in turn
creates dedication (motivation) to reach a particular result.
b. Rejection removes the necessity for action, thereby eliminating the goal and
the need to be motivated.
5. Negatively Originated (Informational) Motives (p. 156)
a. Most common energizers of consumer behavior –negatively originated
motives — for problem removal or problem avoidance. Once a product is
purchased and resolves the problem, drive or motivation is reduced. (p.138)
b. Also called informational motives because the consumer actually seeks
information to reduce the mental state.
c. These could also be called “relief” motives because they relieve the negative
state.
6. Positively Originated (Transformational) Motives
a. Positively originated motives — buy a product for some benefit or reward
rather than removal or reduction of a negative situation.
b. Positively originated motives exist in three basic forms that are also called
transformational motives:
1) Sensory gratification
2) Intellectual gratification
3) Social approval
c. These could also be called “reward” motives because the transformation is a
rewarding state.
Before creating messages, advertisers must seriously consider the goals and
motivations that lead to consumer behavior.
Interpersonal Influences on Consumer Behavior (p. 158)
Interpersonal influences — relationships with other humans affect consumer behavior.
A. Family Influence (p. 151) — from an early age, family communication affects our
socialization as consumers — our attitudes toward many products and our purchasing
habits, a child learning the “right” products to buy. This influence is usually strong
and long lasting. Recent research has indicated that family influence is diminished as
working parents take a less active role in raising their children.
Ethical Issue “Is It Marketing or Is It Exploitation?” (pp. 158, 159)
B. Societal Influence (p. 158) — when we affiliate with a particular societal division, or
identify with some reference group, or value the opinions of certain opinion leaders,
it affects our views on life, our perceptual screens, and eventually the products we
buy.
1. Societal Divisions: The Group We Belong To. Sociologists traditionally divided
society into social classes: upper, upper-middle, lower-middle, etc. However,
these are no longer functional and marketers seek new ways to classify societal
divisions and new strategies for advertising to them. (These will be discussed in
Chapter 5)
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VII.
VIII.
Exhibit 5-7 Contemporary Social Classes (p. 159)
2. Reference Groups: The People We Relate To. People we try to emulate or whose
approval concerns us are called reference groups.
3. Opinion Leaders: The People We Trust. An opinion leader is a person or
organization whose beliefs or attitudes are respected by people who share an
interest in some specific activity. Choosing an opinion leader as a spokesperson
must be done with a complete knowledge of the company’s target market.
C. Cultural and Subcultural Influence. (pp. 160 and 161) Culture relates to a
homogeneous group's whole sets of beliefs, attitudes, and ways of doing things,
typically handed down from generation to generation. Every country has its own
special tastes. It is nearly impossible for an advertiser to change these tastes. The
United States and Canada embrace many subcultures — they may be based on race,
national origin, religion, language, or geographic proximity. Subculture — a
segment within a culture that shares a set of meanings, values or activities that differ
in certain respects from those of the overall culture. Subcultures tend to transfer their
beliefs and values from generation to generation.
Nonpersonal Influences on Consumer Behavior (p. 162)
The most important nonpersonal influences are:
A. Time (p. 162) — all marketing activities must be planned with the consumer's time
clock in mind e.g., when the timing is right for purchase. This is a function of need,
which may be a function of time.
B. Place (p. 162) — marketers carefully weigh consumer demand when deciding where
to build stores or offer their products. If a product appears “everywhere,” consumers
may not consider it to be special.
C. Environment (p. 162) — many environments (ecological, social, political, technical,
economic, household, and point-of-sale location) can affect the purchase decision.
1. A recession may make buyers too poor to afford the product.
2. International Environments (p. 163) — global marketers are especially
concerned with the purchase environment. Of all business functions, marketing
activities are the most susceptible to cultural error. When creating advertisements
for foreign consumption, marketers must consider many environmental factors:
cultural trends, social norms, changing fads, market dynamics, product needs,
and media channels. The state of a country's technological development affects
its economic and social conditions. Some foreign governments exert greater
control over their citizens and businesses. Political control often extends to
which products companies may advertise and sell, which media they use, and
what their ads say. Political environment affects media availability as well.
The Purchase Decision and Postpurchase Evaluation (p. 163)
Ad Lab “Applying Customer Behavior Principles to Ad Making” (p. 163)
RL 4-1 “Consumer Decision-Making Process” (Website)
(Note: The story about a fictitious student named Chris in the text is used to demonstrate
the steps of a consumer’s behavior in making a purchase and the role of advertising in
this process. The use of RL 4-1 in discussing this section is strongly suggested.)
At the point of making a purchase decision, consumers typically search, consider and
compare alternative brands. Consumers evaluate selection alternatives (called the evoked
set). To do this, they establish:
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A. Evaluative criteria — the standards used to judge the features and benefits of
alternative products. Not all brands make it to the evoked set.
B. Postpurchase evaluation
1. Purchaser considers what has been done. A key feature of the postpurchase
evaluation is cognitive dissonance. The theory of cognitive dissonance (also
called postpurchase dissonance) holds that people strive to justify their behavior
by reducing the dissonance, or inconsistency, between their cognition (their
perceptions or beliefs) and reality.
3. The consumer may experience satisfaction from the product, reinforcing the
decision to purchase, or the purchase may prove unsatisfactory. In either case,
feedback from the postpurchase evaluation updates the consumer’s mental files,
affecting perceptions of the brand and future purchases.
AD LAB 5-A “Understanding Needs and Utility” (p. 141)
Select an ad from a weekly news magazine and describe in detail what it offers in terms of
psychic utility and the functional utilities of form, task, possession, time, and place.
Example: A two-page spread magazine ad by Nike showing a dozen or so exhausted, sweaty
athletes being sprayed with a mist of water. Each is dressed in soggy running shorts and t-shirts.
As if in a classic Baroque painting, the well-lighted human figures seem to emerge out of the
darkened and misty backdrop, striking natural — but classic Greek statue-like poses — as they sit
and stand to catch their breath and cool down. The only lettering is “Nike” alongside the familiar
check mark logo in one corner.
The psychic utility of individual performance and success is captured via the way each athlete is
made to appear unique among the group and is posed in a manner that suggests a classic Greek
statue. Their visible perspiration and appearance of being exhausted suggest their performance
has a cleansing effect and of a job done to the fullest. The water mist reinforces the ideal of
cleansing the body. The suggestion they have completed their task suggests that the Nike
equipment helped motivate them and supported them successfully through the strenuous task.
AD LAB 5-B “Applying Consumer Buying Principles to Ad Making” (p. 163)
Choose an ad from a popular magazine and explain how the visuals, the words, and the overall
design of the ad accomplish the following tasks. Provide specific details to support your answers.
1. Penetrate consumer perceptual screens.
Answer guidelines:
Screens need to be penetrated via a peripheral or central pathway route of persuasion by
stimulating:
a. Physiological Screens

sight

hearing

taste

smell

touch
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b. Psychological Screens

innate factors

personality

instincts

learning
2. Stimulate consumer learning.
Answer guidelines:
a. The interplay of symbols (photos, words, and the logo). Do they create a crossassociation?
b. Visual layout. Does it enhance or detract from readability?
c. Text. Does it reinforce the big idea?
3. Utilize the consumer's perceptual files.
Answer guidelines:
Do the words and pictures help you to focus on the product, or ads message? Refer to Exhibit
5-5, page 155.
4. Stimulate consumer wants and needs to affect motivation.
Answer guidelines:
Hierarchy of Needs (Refer to Exhibit 4-5, page 155)
 physiological
 safety
 social
 esteem
 self-actualization
Also refer to exhibit 11-1, page 375
ETHICAL ISSUE “Is It Marketing or Is It Exploitation?” (pp. 158-159)
1. Do you think playing on people's desire for material possessions has a place in advertising?
When does this become exploitation?
Answer guidelines:
a. Individuals make exchanges that they perceive to be at least equal or greater in value than
the cost. Hence, the desire for more possessions is an inherent human factor that certainly
guides product advertising. Playing on people’s drives is not necessarily unethical; but, in
the eyes of some, overdoing it may be. Defining the limits is the problem; people’s
perceptions are highly variable.
b. Utility is the key to any exchange. Some might consider it excessive to do anything more
than simply explaining or portraying the particular utility.
 Utility is a product's ability to provide either symbolic or psychological "want"
satisfaction.
 Consumer "wants" (desires) are "needs" learned during their lifetime.
c. In some circumstances, marketing and advertising can affect exchanges unfavorably and
lead to exploitation
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
Marketing — the process of planning and executing the conception, pricing,
promotion, and distribution of ideas, goods, and services, to create exchanges that
satisfy the perceived needs, wants, and objectives of individuals and organizations.
 Advertising — a function of marketing that can be biased because its content can be inserted
in a medium without outside editing. Its primary goal is to encourage consumers to purchase
the product with the promise of satisfaction of the consumer's wants (i.e., desires) and needs.
Therefore, puffery may be employed that could result in an incidence of exploitation.
 As this ethical issue discussion illustrates, exploitation can occur more readily in conditions
of economic deprivation or social crises.
2. Is it the advertiser's responsibility to determine whether prospective customers can afford a
product or service? Why or why not?
Answer guidelines:
a. Yes: The potential for a class-action law suit exists for advertising a product whose
features and benefits are not properly matched to an audience’s age, economic status,
gender, etc. Also, ads are more successful when the target market has the ability to pay
for the product. If a class-action lawsuit occurs, it could prove to be more costly than
completing research on the nature of the market and potential legal problems. Note: To
succeed, lawsuits typically require proof of intent (to defraud, coerce, etc.); acquiring
such proof (internal memos, correspondence, etc.) can be very difficult and expensive.
b. No: because affordability is not the issue — how individuals choose to spend their money
is the issue. Traditionally, most people who make unwise financial decisions have had to
face the consequence of their actions. Also, it is a money-losing proposition for a
company to market products to individuals who cannot initially pay the price of the
product. So the typical company refrains from advertising to unprofitable markets — and
the cost of handling loans and tracking down deadbeats merely adds to the problem.
3. Do you feel the third-person effect applies to consumers in the developing countries? If so,
how can marketers avoid exploiting them?
Students’ answers will vary.
Sample Answer:
Yes, the belief that marketers are exploiting the poor people in developing nations is very
likely an example of the third person effect. Critics who contend that people who live in the
Third World lack the sophistication to make sound decisions about advertising messages may
be unwittingly saying more about their own arrogance or insecurity than about the real wants
and needs of the people they presume to protect.
Notwithstanding, marketers need to be aware of the potential for people to misperceive their
intent. One way is to focus on relationship building rather instead of sales transactions.
Sophisticated marketers are interested in developing mutually beneficial relationships with
customers that will last for many years. With that objective in mind, they undertake
educational programs, involve themselves in community activities, and strive to avoid any
actions that might be interpreted as exploitation.
REVIEW QUESTIONS
1. What is marketing, and what is advertising’s role in the marketing process? (pp. 139-140)
Marketing is the business process management uses to plan and execute the conception,
pricing, promotion, and distribution of its products. Advertising is just one of the numerous
tools used in the promotion, or communication aspect of marketing. But how advertising is
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done, and where it is run, depends largely on the other aspects of the marketing mix and for
whom the advertising is intended to reach.
2. How does product utility relate to advertising? (p. 140)
An important element in our definition of marketing is the special relationship between a
customer's needs and a product's need-satisfying potential, known as the product's utility.
Utility is the product's ability to satisfy both functional needs and symbolic (or psychological)
wants. Advertising communicates the product's functional or psychic utility.
3. Why is the perceived equal-value exchange an important advertising issue? (pp. 141-142)
An exchange is any business transaction where one person sells something of value to
another person. For such an exchange to take place, an individual must perceive that the
product’s utility is equal to or greater in value than its cost. Thus, the significance of the
perceived equal-value is that without this perception, the likelihood of an exchange is very
remote. Advertising is an important contributor to this process because it can increase the
perceived value of the advertised product.
4. What's the difference between a customer and a market, and what are the different types of
markets? (pp. 143-145)
Customers are the people or organizations who consume products and services. A market is a
group of potential customers who share a common interest, need, or desire, who can use the
offered good or service to some advantage, and who can afford or are willing to pay the
purchase price. The different types of markets are:
a. Consumer markets which include people who buy goods and services for their own
personal use.
b. Business markets which are composed of organizations that buy natural resources,
component products, and services that they either resell (reseller markets) or use in
making (industrial markets) another product.
c. Government markets buy products for the successful coordination of municipal, state,
federal, and other government activities.
d. Transnational (or global) markets include any of the other three markets that are
located in foreign countries.
5. What does the term “consumer behavior” relate to, and why is it important to advertisers? (p.
147)
Consumer behavior is the mental and emotional processes and the physical activities of
people who purchase and use goods and services to satisfy particular needs and wants.
Advertisers spend a lot money to keep individuals and groups of individuals (markets)
interested in their products. To succeed, they need to understand what makes potential
customers behave the way they do.
This is important because a key goal for advertisers is to get enough relevant data to develop
an accurate profile of a set of buyers, in order to establish a common ground for conducting
communications. Advertising creative people are then expected to develop patterns of words
and images (symbols) for ads, using the data from consumer behavior studies as a guide.
6. Which consumer behavior process presents the greatest challenge to advertisers? (p. 145)
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The perception problem is the first and greatest problem advertisers face. Perception — our
personalized way of sensing and comprehending the stimuli to which we are exposed — is, in
fact, our reality. When exposed to over 1,500 advertising messages daily, we learn to be
selective. This screening process typically works against many advertisers, disallowing their
advertising messages to reach our reality. That’s why some advertisers spend millions of
dollars on national advertising, sales promotion, and point-of-purchase displays, only to
discover later that consumers have little or no memory of their product or promotion. Of
those ads that do reach consumers, they may not be able to fully absorb the entire message
without further exposure from other elements of an integrated marketing communications
program.
7. What is the difference between the central route and the peripheral route to persuasion? (pp.
148-149)
Which route is used depends on the consumer’s level of involvement with the product or
message.
In the central route to persuasion, consumers have a higher level of involvement with the
product or message. Therefore, they are motivated to pay more attention to the central,
product-related information, such as product attributes and benefits, or demonstrations of
positive functional or psychological consequences.
The peripheral route to persuasion is very different. People who are not in the market for a
product typically have low involvement with the product message. They have little reason to
pay attention to it or to comprehend the central information of the ad. However, these
consumers might attend to some peripheral aspects, like pictures in the ad or actors in the
commercial, for their entertainment value. Whatever they think or feel about these peripheral,
non-product aspects might integrate into a positive attitude toward the ad.
8. What is the significance of negatively originated motives and positively originated motives to
advertisers? (pp. 155-156)
Before creating messages, advertisers must carefully consider the goals that lead to consumer
motivations. The purchase of a certain product might represent a negatively originated motive
to some, and a positively originated motive to others. This suggests two distinct product
markets that advertisers must understand and may call for completely different advertising
strategies.
9. What are some of the environmental influences that affect consumer behavior in international
markets? (pp. 158-159)
As a nonpersonal influence on consumer behavior, the all-encompassing nature of
“environment” makes it more difficult to control than those of “time” or “place.” A country's
technological development affects its economic and social conditions. Some foreign
governments exert control over their citizens and businesses, determining which products
companies may advertise and sell, which media they use, and what their ads say. A religion
can similarly govern an entire nation’s buying habits.
There are strategies that can mitigate the influences stemming from the environment. In
countries where people earn little, demand for expensive products is low. So the creative
strategy of an automobile advertiser might be to adapt by targeting the small group of
wealthy, upper-class consumers. In a country with a large middle class, the same advertiser
would be better off mass marketing the car and positioning it as a middle-class product.
(Note: Consumer behavior includes the activities, actions, and influences of people who
purchase and use goods and services to satisfy their personal or household needs and wants).
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10. How does the theory of cognitive dissonance relate to advertising? (pp. 164)
The theory of cognitive dissonance states that people strive to justify their behavior by
reducing the degree to which their impressions or beliefs are inconsistent with reality. When
a consumer makes a purchase of an expensive diamond necklace, for example, the exchange
requires a loss of cash, an obvious component of financial security and happiness. The loss
stimulates an emotional reaction characterized by a mild flush of anxiety that’s followed by a
mental review of the entire purchase. The anxiety is reduced when the purchaser reads an
advertisement reassuring him that diamonds are a good investment that can “return a greater
cash value” at a later time.
Some advertisers have attacked a market leader with attempts to create cognitive dissonance
for competitive reasons. Market leaders (and political incumbents), on the other hand, must
try to reduce dissonance by placing advertisements positioning themselves or their product as
the "wise choice".
EXPLORING THE INTERNET
These Internet exercises address the two main areas covered in this chapter: marketing (Exercise
1) and consumer behavior (Exercise 2).
1. Marketing
Visit the following Web sites and apply what you have learned from this chapter by
identifying the marketer, product utility, customer(s), and type of market(s) for each.
 AT&T (www.att.com)
 Caterpillar (www.caterpillar.com)
 Delta Air Lines (www.delta-air.com)
 DHL Worldwide Express (www.dhl.com)
 FOX Broadcasting Company (www.fox.com)
 General Motors (www.gm.com)
 Johnson & Johnson (www.johnsonandjohnson.com)
 Kodak (www.kodak.com)
 Marriott (www.marriott.com)
 NBA (www.nba.com)
 Proctor & Gamble (www.pg.com)
 Siemens (www.siemens.com)
 Sony (www.sony.com)
 Transamerica Corp. (www.transamerica.com)
 Unisys (www.unisys.com)
 Visa International (www.visa.com)
 Wal-Mart (www.wal-mart.com)
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Sample Answer:
www.delta-air.com
a. marketer: Delta Airlines
b. product utility: form (comfortable airfare accommodations), possession (low price), and
time (online reservations) utility
c. customer(s): largely adults; 60/40 men due to business travelers
d. type of market(s): consumer and business-to-business markets
2.
Consumer Behavior
Understanding consumer behavior is essential to the contemporary advertiser. Browse the
websites listed below, keeping in mind what you have learned about culture/subculture, social
class, reference groups, family/household, and opinion leaders. Identify and describe the
major social influences that enable each organization to be successful in reaching its
consumers.
 alt.Culture (www.altculture.com)
 America Online (www.aol.com)
 Beechnut (www.beechnut.com)
 Ben & Jerry’s (www.benjerry.com)
 Cars & Culture (www.carsandculture.com)
 Motorola (www.motorola.com)
 Music Television (MTV) (www.mtv.com)
 Rollerblade (www.rollerblade.com)
 Sega (www.sega.com)
 Tower Records (www.towerrecords.com)
Sample Answer:
America Online (AOL)America Online is a major example of the social influences and trends that
dominate the latter half of the 1990s. Why has AOL been so successful?
a. Education about the benefits of and how to use computers is a social change that has
facilitated a lower cost and greater availability of computers. The computer’s impact on
society allowed greater access to information and eased the transfer of data, making
people more efficient and effective in getting things done.
b. Cyberspace has become a large part of many Americans’ interactions with their various
reference groups – be it e-mail with their friends/family or surfing Web sites for more
information on their favorite movie star.
c. Many of the opinion leaders now exist to purport the Internet life.
d. Our culture is becoming more and more fast-paced, and the wealth of information on the
Net helps to save time and provide easy, inexpensive, and efficient access to a wealth of
information allowing consumers to, in the end, be more productive and spend more time
doing what they want to do – even if it is more time browsing the Web!
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IMPORTANT TERMS
Attitude, 153
brand interest, 153
brand loyalty, 153
business markets, 144
centers of influence, 143
central route to persuasion, 152
cognition, 149
cognitive theory, 151
conditioning theory, 151
consumer behavior, 145
consumer decision-marking process, 146
consumer markets, 143
culture, 160
current customers, 143
Elaboration Likelihood Model, 152
environments, 162
evaluation of alternatives, 147
evaluative criteria, 164
evoked set, 164
exchange, 141
government markets, 144
habit, 153
hierarchy of needs, 155
industrial markets, 144
informational motives, 157
interpersonal influences, 147, 158
learning, 151
market, 143
marketers, 145
marketing, 139
mental files, 150
motivation, 155
needs, 155
negatively originated motives, 156
nonpersonal influences, 147, 162
opinion leaders, 160
organizational buyers, 145
perception, 147
perceptual screens, 148
peripheral route to persuasion, 152
personal processes, 147
persuasion, 151
physiological screens, 148
positively originated motives, 157
postpurchase dissonance, 164
postpurchase evaluation, 147, 164
prospective customers, 143
psychological screens, 148
reference groups, 160
reseller markets, 144
selective perception, 149
self-concept, 148
social classes, 158
stimulus, 147
stimulus-response theory, 151
subculture, 161
theory of cognitive dissonance, 164
transformational motives, 157
transnational (global) markets, 144
utility, 140
wants, 155
ANCILLARY
ACTIVITIES & EXERCISES
1. Utility is the product's ability to satisfy both functional needs and symbolic (or psychological)
wants. Advertising communicates the product's functional or psychic utility. Thus, some ads
promote how well a product works, while others tout glamour, sex appeal, or status. Have
the students find at least 3 examples of ads that satisfy functional needs and 3 examples of
ads that satisfy symbolic (or psychological) wants.
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2. Have the students select five (5) ads, one for each stage in Maslow's hierarchy of needs. The
students are to identify which of the motivational needs they believe the advertisers were
appealing to when they created the advertisement and give an explanation as to their choice.
IMAGES FROM THE TEXT
Images are available as color acetates through your local McGraw-Hill/Irwin sales
representative.
A5-1
A5-2
A5-3
A5-4
Exhibit 5-1
Exhibit 5-2
Exhibit 5-3
A5-5
A5-6
A5-7
Exhibit 5-4
Exhibit 5-5
Exhibit 5-6
Homegrocer.com ad (p. 137)
Customer decision process conceptual model (p. 146)
Consumer perception process (p. 148)
Cognitive and conditioning learning theories
(p. 151)
Elaboration Likelihood model (p. 152)
Hierarchy of Needs (p. 155)
Purchase and usage motives (p. 156)
REFERENCE LIBRARY
Located on the McGraw-Hill
Contemporary Advertising website:
www.mhhe.com/arens04
RL 5-1
The complete model of the Consumer Decision-Making Process
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