Product Knowledge and Involvement 1

Hierarchy of Product Competition Generic Competition – Trade-offs between customer expenditure to different problems that require a solution Class Competition – Different approaches to providing customer solutions to a common problem

Hierarchy of Product Competition (cont) Form Competition – Products perceived as addressing a problem in a similar way by providing comparable benefits Brand Competition – Products from an identified supplier that offers a particular value-proposition, set of options, and distribution system.

Levels of Product Knowledge Product Class Product Form Brand Model/Feature Coffee Ground Instant Folgers Maxwell House 1-pound can 8-ounce jar Autos Sedan Sports Car Sports Sedan Ford Taurus Mazda Miata BMW Station wagon, Air & power steering Leather seats, Air & 5 speeds Model 325e, Air & Automatic Trans

Levels of Product Knowledge Product Class Product Form Brand Model/Feature Beer Imported Light Low alcohol Heineken Coors Lite Sharps Dark Kegs 12-ounce cans Pens Ballpoint Felt tip Bic Pilot $0.79 model, regular tip $0.99 model, extra-fine tip

PRODUCT LIFE CYCLE STAGES OF THE DECISIONS PROCESS FOR INSTANT COFFEE 1 8 - 1 6 - 1 4 - 1 2 - MILLIONS OF POUNDS 1 - 8 - 6 - 4 - 2 - | | | | | | | | | | | 1 9 4 8 1 9 5 1 9 5 2 1 9 5 4 1 9 5 6 1 9 5 8 1 9 6 1 9 6 2 1 9 6 4 1 9 6 6 1 9 6 8

Product Life Cycle Characteristics Introduction Growth Maturity Decline Sales Low Fast Slow Decline Growth Growth Profits Cash Flow Customer Description Number of Competitors

Product Life Cycle Characteristics Introduction Growth Maturity Decline Strategic Focus Marketing Expenditures Marketing Emphasis Distribution Intensity Price Product

Types of Product Knowledge 1. Bundle of Attributes - Tangible (concrete) or intangible (abstract) characteristics of the product Nike running shoes Arch support Tread design $89.95 Lacing pattern

Types of Product Knowledge 2. Bundle of Benefits - Consequences or outcomes when purchasing and using products & services (Functional, Psychosocial) Nike running shoes Long-wearing Stabilize heel Run faster

Types of Perceived Risk Benefit risks: 1. Functional 2. Physical 3. Financial 4. Social 5. Psychological

Types of Product Knowledge 3. Value Satisfaction - Cognitive representations of important broad life goals that consumers are trying to achieve Be physically fit Have good health Live a long life Nike running shoes

The Means-End Chain A means-end chain is a knowledge structure that connects consumers’ meanings about product attributes, consequences, and values. The means-end chain provides a more complete understanding of consumers’ product knowledge.

Functional Consequences Psychosocial Consequences Means-End Chains of Product Knowledge Attributes Functional Consequences Less Psychosocial Consequences Level of Abstraction Values More

Means-End Chain Example: Gillette Sensor Razor CONSEQUENCES FUNCTIONAL PSYCHOSOCIAL ATTRIBUTES VALUES Spring suspension for twin blades Be well groomed Be attractive Close shave Relaxed Not stressed Lubricating strip Smooth, soft shave Be comfortable

Consumers’ Product Involvement The perceived importance or personal relevance of an object, event, or activity Involvement with a product or brand has both cognitive and affective aspects

Components of Involvement 1. Importance and risk (the perceived importance of the product and the consequences of a bad purchase) 1, 2, 3, 14 2. Probability of making a bad purchase 3. Pleasure value of the product category 4, 5, 6, 7 4. Sign value of self identify 11, 12, 13, 15, 16 8, 9, 10

Involvement Profiles of French Consumers (100 = average) Negative Pleasure Sign Consequences Mispurchase Value Value Detergents 79 82 56 63 Dresses 121 112 147 181 TV Sets 112 100 122 95 Vacuum Cleaners 110 112 70 78 Champagne 109 120 125 125 Yogurt 86 83 106 78 Facial Soap 82 90 114 118

Model of Consumer Product Involvement Self-concept -- basic values, goals, needs Personality traits Expertise Consumer characteristics Time commitment Price Symbolic meanings Potential for poor performance Product characteristics Purchase situation Time pressure Social environment Physical environment Environmental characteristics

Consumer characteristics Model of Consumer Product Involvement Consumer characteristics Intrinsic Self Relevance Involvement Interpretation & Integration Processes Product characteristics Situational Self Relevance Environmental characteristics

Factors that Influence Involvement Lower Involvement Higher Involvement (Toothpaste) (Automobile) Symbolic meanings Few Many regarding self: Social visibility of product Price: Potential harm to self and others Potential for poor performance: Time commitment to the purchase: