Consumer Behavior MKTG 302-PSYC 335 Comprehension, Memory, and Cognitive Learning Prof. Dr. Zeynep Gürhan-Canlı

Comprehension Refers to the interpretation or understanding that a consumer develops about some attended stimulus in order to assign meaning.

Exhibit 4.1: The Components of Consumer Information Processing

Exhibit 4.2: Comprehension Depends on Multiple Factors

Physical Characteristics of the Message Intensity Color Font ©JONATHAN LARSEN/DIADEM IMAGES/ALAMY Numbers Spacing

Simplicity/Complexity Simple phrases such as “fat free” often communicate more clearly than detailed information. ©JAMES F. QUINN/CHICAGO TRIBUNE

Exhibit 4.3: Congruent or Incongruent Message Sequences? IMAGE COURTESY OF THE ADVERTISING ARCHIVES PR NEWSWIRE

Message Source Factors Likeability Attractiveness Trustworthiness Expertise

Message Receiver Characteristics Intelligence/Ability Prior Knowledge Involvement Familiarity/Habituation Expectations Physical Limits Brain Dominance

Environmental Characteristics Information Intensity Framing Timing

Prospect Theory (Kahneman and Tversky 1979) Value (+) Loss Gain Value (-) The Value Function

Prospect Theory Buyers judge a loss as more painful than they judge the gain of an equal amount as pleasurable. Gains and losses have a diminishing effect as they grow larger. It is advantageous to segregate gains in a mental account. It is likewise advantageous to integrate losses. More positive evaluations result from the bundling of prices and debundling of price discounts.

Framing Effects (adapted from Puto 1987) Example: The use of budgets to frame the prospects of an industrial buyer contracting for parts. The buyer is given a budget of $100,000. The buyer must choose between two suppliers: Supplier A will deliver the necessary parts at a guaranteed price of $90,000. Supplier B will deliver the necessary parts, but the price is dependent on contract provisions. There is a .5 probability that the price will be $80,000 and a .5 probability that the price will be $100,000. Which supplier would you choose? Another buyer must choose between the same two suppliers, but with a budget of $80,000. Which supplier would you choose?

Multiple Store Theory of Memory Views the memory process as utilizing three different storage areas within the human brain.

Exhibit 4.6: The Multiple Store Approach to Memory Rehearsal Encoding

Mental Processes Assisting Learning Repetition Dual Coding Meaningful Encoding Chunking These rely on making associations.

Associative Network A network of mental pathways linking knowledge within memory.

Associative Network Coffee Carbonated Caffeine Pepsi Generation Brown Coke Pepsi “The Bottle” Sweet Taste Cold Beverage Trace strength and accessibility, spreading activation, priming

Exhibit 4.9 The Knowledge for Snack Foods

Retrieval Types of retrieval Retrieval failures Recall and recognition Decay: The weakening of nodes or links over time. Interference occurs due to semantic networks being closely aligned. Primacy and recency effects

Cognitive Schemas Schema – a type of associative network that works as a cognitive representation of a phenomenon that provides meaning to that entity. Exemplar – a concept within a schema that is the single best representative of some category. Prototype – characteristics more associated with a concept.

Apply the cognitive schema concept in understanding how consumers react to products, brands, and marketing agents. 26

Exhibit 4.10 Category Exemplars

Episodic Memory, Social Schemata, and Elaboration Episodic memory may elicit fond childhood memories of playing cowboy. Stetson is relying on the social schema or stereotype of the cowboy to provide meaning. Elaboration allows the consumer to picture himself using the cologne resulting in better recall. IMAGE COURTESY OF THE ADVERTISING ARCHIVES