Marketing & Services Management MSc Marketing & Services Management Consumer Value & Experiential Marketing Dr. Weiyue (Jimmy) Wang

Lecture Objectives To understand: consumer personal value social influences consumer segments experiential marketing empirical academic studies

Consumer Personal Value Consumers’ personal values and social influences play significant roles in product evaluation and purchase behaviour (Zhou and Wong 2008, Pepper et al. 2009, Darley et al. 2010) Personal values is defined as an enduring belief that a specific mode of existing conduct is personally and socially preferable to an alternative mode of existing conduct (Rokeach,1968).

Social Influences on Consumer Behaviour On social influences side, based on the social compliance and normative influence theories (Bearden et al. 1989, O’Cass and McEwen 2004), peer or reference people represents an actual or imaginary group that have significant relations to an individual’s evaluations and behaviour.

An Academic Research Animosity and Willingness to Buy Foreign Products: The Moderating Effects of Materialism and Susceptibility to Normative Influence 5

CET and Animosity Consumer ethnocentrism (CET): the beliefs held by consumers about the appropriateness, indeed morality, of purchasing foreign-made products’ (Shimp and Sharma 1987) The central tenet of CET is that consumers with stronger CET distinguish domestic products from foreign/imported products and try to avoid buying foreign products Ethnocentric consumers tend to believe that purchasing foreign products harms the domestic economy and it is immoral to buy them Animosity: remnants of antipathy related to previous or ongoing military, political, or economic events (Klein et al., 1998)

The Existing Framework Consumer ethnocentrism Product judgement Willingness to buy foreign products Economic animosity War animosity 7

An Expanded Framework Materialism Centrally held consumer belief about the importance of possessions in one’s life (for example, pleasure and happiness) (Belk 1985) A mind-set or constellation of attitudes regarding the relative importance of acquisition and possessions of objects in one’s life’ (Richins and Dawson 1992, p. 307). Susceptibility to Normative Influence (SNI): the tendency to live up to the expectations of others (Bearden et al. 1989, Batraet al. 2001) SNI is driven by the desire and need to maintain and enhance self-image through identification with a reference group and by adopting its behaviour or opinion

The Expanded Framework Consumer ethnocentrism Product judgment Willingness to buy Economic animosity War animosity Susceptibility to normative influence Materialism 9

Source: Luo, 2005, Journal of Consumer Psychology Shopping with others… How does shopping with others influence impulsive purchasing Sample: 152 + 112 undergraduates for two experiments The presence of peers increases the urge to purchase but the presence of family members decreases it Moderator: participants are more susceptible to social influence and the group (peers or family) is more cohesive Source: Luo, 2005, Journal of Consumer Psychology

Consumer Segmentation Need Behaviour Characteristic

Experiential Marketing Customers’ developing recognition of and purchasing goods or services from a company or brand after they experience activities and perceived stimulations (Schmitt, 1999) Tangible products to intangible services Companies should focus not only on products/services they sell but also on an entire experience that they create for customers (Yuan & Wu, 2008)

Traditional Marketing Features and benefits Traditional Marketing Narrow definition of product category and competition Method are analytical, quantitative and verbal Customers are rational decision-makers Source: Schmitt, 1999

Experiential Marketing Customer Experience Consumption is a holistic experience Methods are eclectic Experiential Marketing Customers are rational and emotional animals Source: Schmitt, 1999

Strategic Experiential Modules Strategic Experiential Modules include Sensory experiences (SENSE) Affective experiences (FEEL) Creative cognitive experiences (THINK) Physical experiences, behaviours and lifestyles (ACT) Social-identity experiences (RELATE) Schmitt, B. 1999. Experiential Marketing, Journal of Marketing Management, 15, 53-67.

Empowerment Structural or relational approach of empowerment management practices and activities that seek to give more power to the employee Motivational or psychological approach of empowerment employee’s cognitive beliefs or perceptions of being empowered 16

Psychological Empowerment A motivational sense that enhances feelings of self-efficacy among organizational members (Conger and Kanungo,1988) A motivational construct manifested in four cognitions: meaning, competence, self-determination, and impact (Spreitzer, 1995) Meaning Competence Self-determination Impact 17

What we have achieved? Consumer segmentation Consumer values Social influences on consumer buying behaviour Direct and indirect effects on consumer decision making Consumer segmentation Experiential Marketing Components of Experiential Marketing (Schmitt, 1999) Empirical studies