Syllabus for MKTG 330, Sections 3 & 4
CONSUMER BEHAVIOR
http://www.personal.psu.edu/jxb14/M330/
Spring 2012
Hans Baumgartner
Smeal Professor of Marketing
Office: 482 Business Bldg., Phone: 863-3559, E-mail:
Office hours: TR 2:30-4:00 or by appointment
Course objectives:
Establishing and maintaining exchange relationships with customers is critically important to the success of an organization, and a proper understanding of consumer behavior is a prerequisite for effective marketing decision-making. The purpose of this course is to introduce you to the study of consumer behavior and to provide you with an overview of the management of customer relationships. In general, you will learn how to solve practical problems by applying conceptual frameworks that help you organize your thinking about an issue. More specifically, this course will expose you to a variety of mental models that are useful for understanding the behavior of consumers, and through examples, exercises, case discussions, and short projects you will practice applying these models to the solution of marketing problems.
Course Details:
Course materials. Lecture topics and homework assignments are listed under Course Schedule. The overheads used in class are available as PowerPoint files from the course web site. A course pack containing all required readings is available from the Student Bookstore.
Preparation for class. The course will be a combination of lectures and discussions. For each class, read the relevant material in the course pack, download the overheads, and complete all assigned exercises. I expect you to come to class regularly and to take an active role in class discussions. I will monitor your attendance and participation in class, and both will contribute to your course grade.
Class exercises (CE). For many of the lectures I have developed an exercise that you should complete prior to coming to class. The exercises are listed in the assignment column of the Course Schedule (by their due date) and they are described in the on-line version of the syllabus. You don’t have to hand in anything and I won’t grade the exercises, but we will talk about them in class and you won’t be able to participate in the discussion unless you’ve done them ahead of time. Remember that your class participation is an important component of your grade.
Case discussions. We will analyze two cases during the semester. Case discussions only work well if everybody prepares the case thoroughly ahead of time. Please use the discussion questions listed under Class Exercises for this purpose. You should prepare all of the questions, but you have to hand in a typed response to three of the discussion questions at the beginning of class on the day of the case discussion (two-page maximum). If you want, you can prepare the case in groups, but the write-up should be done individually. Please note that you may be called upon to answer questions during the in-class discussion.
Short projects (SP). The purpose of the short projects is to illustrate important theoretical concepts and to give you an opportunity to conduct your own research. The short projects are listed in the assignment column of the Course Schedule (by their due date) and they are described in more detail in the on-line version of the syllabus. Each short project refers to an issue discussed during a previous class. There are four short projects in total. You are required to do two of them in writing by handing in a typed report (maximum of one single-spaced page excluding appendices, if appropriate) on the due date indicated in the Course Schedule (e.g., the first short project on memory for ads is due 1/31). Everybody has to choose one SP from the first part of the course (prior to spring break) and one from the second part.
Grading. There will be three non-comprehensive exams, which will count for 60% of your grade (20% each). The exam dates are listed in the Course Schedule. If you cannot come to class on a day when we have an exam, let me know in advance (and supply a very good reason for your absence), or your course grade will automatically drop by 20%. The short projects will contribute 15% to your grade. The case write-ups and your contribution to the in-class case discussions will be worth 10%. Your attendance and participation in class will make up the remaining 15%. My grading policy is as follows:
93 – 100 A 77 – 79 C+
90 – 92 A- 70 – 76 C
87 – 89 B+ 60 – 69 D
83 – 86 B 0 – 59 F
80 – 82 B-
Academic integrity, affirmative action & sexual harassment, and disabilities. Please see the following handout (integrity.doc), also attached to this syllabus, for details on these issues.
Course Schedule
DATE
/TOPIC
/ASSIGNMENT
1/10 / Course Introduction1/12 / Understanding Consumer Behavior: Mental Models for Marketers (intro.ppt) / CE: The introduction of New Coke
1/17 / Consumer Behavior Research
(research.ppt) / Norman (1976), A Comparison of Expert and Attractive Sources
1/19 / Psychological Foundations: Consumer Memory I (Overview) (memory1.ppt) / Keller (1993), pp. 1-8
CE: Advertising imagery
1/24 / Psychological Foundations: Consumer Memory II (Brand Knowledge and Brand Equity) (memory2.ppt) / Keller (1993), pp. 8-17CE: Brand schemas and brand extensions
1/26 / Case discussion: Mountain Man Brewing Company (MMBC) / Brief Cases, HBP # 2069CE: Discussion questions for MMBC case
1/31 / Psychological Foundations: Consumer Perception I (Attention) (percept.ppt) /
Peter and Olson (2008), Chapter 5 (pp. 103-115)
CE: Attention-getting marketing stimuliSP: Memory for ads
2/2 / Psychological Foundations: Consumer Perception II (Comprehension) (percept.ppt) /
Peter and Olson (2008), Chapter 5 (pp. 115-123)
CE: Inferences2/7 / Psychological Foundations: Consumer Affect and Motivation I (affmot.ppt) /
Peter and Olson (2008), Chapter 4
CE: Means-end chain analysis
2/9 / Psychological Foundations: Consumer Affect and Motivation II (affmot.ppt) and Review of Material for 1st Exam / Practice exam: Practice1.doc2/14 / First Exam /
2/16 / The Consumer Decision Making Process (decision.ppt) /
Peter and Olson (2008), Chapter 7 (pp. 162-172)
CE: Choice sets2/21 / Understanding Consumer Preferences I (Decision Rules and Heuristics) (decision.ppt) / Peter and Olson (2008), Chapter 7 (pp. 172-184)
CE: Decision rules and heuristics
SP: Attention-getting ads
2/23 / Understanding Consumer Preferences II (Conjoint Analysis) (conjoint.ppt) / A Practical Guide to Conjoint Analysis
CE: Conjoint analysis for laptops
2/28 / Consumer Satisfaction and Loyalty I (satis.ppt) / CE: Satisfaction measurement
3/1 / Consumer Satisfaction and Loyalty II (satis.ppt) / CE: The American Customer Satisfaction Index
3/6
3/8 / Spring break
3/13 / Environmental Influences on Consumer Behavior
(environ.ppt) / CE: Hofstede’s Cultural Dimensions
3/15 / Regularities in Purchase Behavior (regular.ppt) / Armed to the Teeth: Part A (read and complete the exercises)
3/20 / Market Segmentation and Target Marketing I
(segment.ppt) /
CE: Segmentation in the toothpaste market
SP: Critical incidents3/22 / Market Segmentation and Target Marketing II
(segment.ppt) and Review of Material for 2nd Exam /
Practice exam: Practice2.doc
3/27 / Second Exam /3/29 / Product Positioning
(mix.ppt) /
CE: Positioning of pain relievers
4/3 / Case discussion: Saxonville Sausage Company (SSC) /Brief Cases, HBP # 2085
CE: Discussion questions for SSC case4/5 / Consumer Response to Product and Price Programs I
(ppprog.ppt) / Zeithaml (1988), pp. 2-10
CE: Quality, price, and value of E-book readers
4/10 / Consumer Response to Product and Price Programs II
(ppprog.ppt) / Zeithaml (1988), pp. 10-18
4/12 / Consumer Response to Sales Promotion Programs
(spprog.ppt) / Chandon et al. (2000), Benefit Congruency Framework
CE: Evaluating sales promotions
4/17 / Consumer Response to Advertising Programs I
(cprog.ppt) / Shimp (1997), Chapter 6 (pp. 143-146, 150-160)
SP: Price knowledge
4/19 / Consumer Response to Advertising Programs II
(cprog.ppt) / Shimp (1997), Chapter 6 (pp. 160-167)
CE: TORA and coupon usage
4/24 / Consumer Response to Distribution Programs (dprog.ppt) / CE: Store atmosphere
4/26 / Course Wrap-Up and Review of Material for 3rd Exam / Practice exam: Practice3.doc
Finals Week / Third Exam
Class Exercises (CE)
The introduction of New Coke
One of the most famous marketing stories is the introduction of New Coke in 1985. Do some online research (Wikipedia is a good source) to answer the following questions: Why did the Coca-Cola Company decide to reformulate its flagship soft drink? How was the research leading to the reformulation conducted? Do you think Coca-Cola practiced the marketing concept when introducing New Coke, or when bringing back Coke Classic? Why or why not? Remember that practicing the marketing concept means that all company activities are focused on satisfying the needs and wants of customers in relevant target markets better than the competition.
Advertising imagery
Find a print ad that encourages vivid imagery (through the use of explicit imagery instructions asking consumers to imagine or visualize something, concrete words rich in imagery, or pictures that stimulate imagery) to help you remember the brand or information about the brand contained in the ad. What specific features make the ad memorable? If possible, bring the ad to class so everybody can see it.
Brand schemas and brand extensions
Draw your associative network for Clorox. Do this by thinking of all the associations that you have with this brand. How strong and favorable are the various associations, and which ones are unique to the brand? If you don’t know much about Clorox, talk to somebody who does. Assume that your brand schema is representative of schemas held by consumers in general and evaluate the marketing implications of the associative network. If Clorox were planning to extend the brand to other product categories (think about which other categories would be possible extension candidates), would these associations facilitate or hinder consumers’ acceptance of the extended brand?
Discussion questions for MMBC case:
(1) Why has MMBC been successful in the past? Discuss all aspects of this success in terms of the company, its customers and competitors.
(2) Discuss the Mountain Man Lager brand from the perspective of Keller’s model of brand knowledge. Does Mountain Man Lager have strong brand equity and if so, why? What has MMBC done to build customer-based brand equity?
(3) Why has MMBC experienced difficulties in recent years in spite of its strong brand?
(4) What options does Chris have? Is “do nothing” a feasible option?
(5) What are the pros and cons of introducing Mountain Man Light? Discuss this issue from the perspective of the model of brand extension discussed in class.
Attention-getting marketing stimuli
During one of your shopping excursions (e.g., a trip to the grocery store, a mall visit), carefully observe all the marketing stimuli present in the store environment (products, ads, promotions, etc.) and think about what makes (some of) them attention-getting. List at least five characteristics that are attention-getting for you. Be prepared to discuss your findings in class.
Inferences
Collect a few examples of brand names, brand symbols, package designs, product features, advertising claims (e.g., about nutritional content), promotional tactics, etc. that invite consumers to draw inferences about a product. Which of these inferences may not accurately characterize the product in question and could therefore be called misleading? Be prepared to discuss your examples in class and, if possible, bring them to class.
Means-end chain analysis
Read Chapter 4 of Peter and Olson to learn about means-end chain analysis and laddering. Then conduct a laddering interview with two consumers for the product category of premium ice cream (such as Häagen-Dazs). Proceed in three steps. First, determine which product attributes are important to consumers when they purchase premium ice cream. Second, for each product attribute, ask your informants why these attributes are important to them and try to elicit the consequences and values associated with each attribute. Third, based on these interviews, construct a hierarchical value map (HVM) for premium ice cream. Design an ad based on your HVM to market premium ice cream to college students.
Choice sets
Choose a product category in which three acquaintances who are not in this class made a recent purchase (e.g., soft drinks, fast food restaurants, energy bars, etc.). Ask your respondents to list all the brands in the product category that they were aware of prior to making the purchase (awareness set), and then have them indicate which brands they considered buying (consideration set), which brands they were indifferent toward (inert set), and which brands they knew they didn’t want to buy (inept set). Of course, you should also keep track of which brand they actually purchased. Try to find out from your respondents why different brands belong to each of the different choice sets.
Decision rules and heuristics
Use the data in the table below to decide which product a consumer would choose if (s)he were to use the following decision rules or heuristics: (a) weighted additive rule (according to this rule, the overall score is the weighted sum of the subjective values, where the weights are the attribute importances); (b) equal weight heuristic (according to this rule, unit weights are used for all attributes); (c) conjunctive heuristic; (d) lexicographic heuristic; and (e) elimination by aspects heuristic (read Chapter 7 in Peter and Olson, esp. Exhibit 7.4, before doing this assignment). Note: Numbers in parentheses are subjective ratings on a scale from 1 to 10, with 10 being the maximum score. Use these ratings in your calculations. The cutoff levels refer to the minimum or maximum acceptable standard on a given attribute (e.g., >5 on image means that the rating on this attribute has to be greater than 5 in order for the car to be considered).
Brand image / Price / Warranty (years/miles) / J.D.Power mechanical quality / Crash test rating / Horse-power / EPA mileage (city/highway)Nissan Altima / (6) / $19,800 (7) / 3/36K (7) / 3 (6) / Excellent (10) / 175 (8) / 23/29 (8)
Honda Accord / (8) / $17,095 (8) / 3/36K (7) / 4 (8) / Excellent (10) / 160 (7) / 24/34 (9)
Toyota Camry / (9) / $19,025 (7) / 3/36K (7) / 3 (6) / Excellent (10) / 160 (7) / 24/34 (9)
Ford Taurus / (6) / $21,200 (5) / 3/36K (7) / 3 (6) / Good (8) / 153 (5) / 20/27 (7)
VW Jetta / (10) / $25,045 (4) / 5/50K (9) / 4 (8) / Excellent (10) / 180 (9) / 22/29 (8)
Attribute importance / 6 / 10 / 9 / 8 / 6 / 5 / 7
Cutoff level / >5 / <$22,000 / >2/30K / >2 / at least good / >170 / >20/27
Conjoint analysis for laptops