WESTERN CONNECTICUT STATE UNIVERSITY ANCELL SCHOOL OF BUSINESS Marketing Department MKT 310 Consumer Behavior: Concepts, Research Methods and Application Dr. Ronald Drozdenko Office WS 301 e-mail: drozdenkor@wcsu.edu 4 SH Spring 2008 837-8776 Office Hours: Tuesday & Thursday 1:00-2:00 pm, Wednesday 9:00am-12:00pm. Please e-mail me to confirm an appointment. Appointments for other times may be arranged. Contact List: I will be using your Western and Blackboard Vista e-mail addresses to contact you. Course Web Site at conduit.wcsu.edu Updates to this syllabus will be posted on the course site. Catalog Description: Consumer Behavior is the study of the buying units (e.g., people, family, businesses, organizations, etc.) and the exchange processes involved in acquiring, consuming, and disposing of goods, services, experiences and ideas. Concepts and research methods from marketing and the social and behavioral sciences are applied to describing and understanding decision processes in the context of the global marketplace. Students will examine how marketers use consumer data to make decisions about product development, service, promotion, pricing and distribution channels. This course provides students with an opportunity to explore and apply concepts from the perspectives of the marketer, the consumer and society in general. PREREQUISITES: Junior Standing, MKT 301 and FIN 230 (or another basic statistics course) and GPA > 2.3. If you do not meet these prerequisites, see me immediately. Required Text: Consumer Behavior by Leon G. Schiffman & Leslie Lazar Kanuk; 2007, 9th ed. Prentice Hall. Instructor's Emphasis and Objectives: In addition to the above catalog description, students will become familiar with the methods marketers use to the study specific marketing problems and opportunities. Toward this goal, students will complete application projects in the areas of: - market segmentation - brand positioning - hypothesis testing - decision making for high and low involvement products Several in-class projects such as package perception, memory organization, attitude measurement, crosscultural product preferences, and peer group influence will also strengthen an applied orientation to the study of consumer behavior. As part of departmental program assessment and continual improvement, there will also be supplemental coverage of service and not-for-profit marketing. In order to evaluate student comprehension throughout the semester, assessment of key concepts will be embedded into course materials. Consumer Research Exercises The Marketing Department revised the curriculum in order to reinforce and integrate fundamental quantitative and research concepts into the required courses in the major. This expanded course in Consumer Behavior incorporates exercises designed to build knowledge and skills in consumer research. These exercises will apply important concepts in marketing decision-making and use Excel and SPSS for data analysis. Use of Technology In this Course: This course uses technology to enhance learning and provide exposure and practice in using technology tools. Technology elements of this course include: Lectures and discussions guides in Powerpoint Data analysis and graphics in Excel and SPSS Use of library resource databases Online surveys Internet applications Course website with discussion section, current articles and other supplemental materials Course Website: Please visit the course website often for course updates, online discussions and the posting of materials. You will be able to access your grades and articles. Notification of class cancellations will be posted on the website. Go to conduit.wcsu.edu for information on accessing the website. COURSE REQUIREMENTS: Four application projects Eight in-class exercises Three exams Class participation The due dates for these requirements are listed in the Class Schedule (page 8). PLEASE NOTE Assignments submitted late are subject to a 20% point reduction for each calendar day late. There is a 10% grade reduction service charge if you e-mail me an assignment without permission. Please use your WCSU e-mail address to contact me. E-mail from other addresses may be filtered and not get to me. Use topic headings when writing reports. All reports must be typed and stapled. No folders or oversized pages please. Make up exams will be given at the instructor's discretion if arrangements are made prior to the scheduled exam time. (Exceptions to this policy may be made in cases of documented illness.) Incomplete grades will be given only with advance approval. Back up all computer files and don’t wait until the due date to print your reports. If you have a problem with an assignment or an exam date please see me in sufficient time so that we can address the problem. Please review Western’s Academic Honesty Policy http://www.wcsu.edu/facultystaff/handbook/forms/honesty-policy.pdf Course failure, suspension or expulsion from the University can be the consequence of violating academic behavior codes. 2 Attendance policy: Consistent attendance is encouraged and will be recorded regularly. Late attendance will be noted. Attendance affects your class participation grade and is significantly correlated with exam performance. Exams: The exams will cover the concepts presented in the text and any other materials discussed in class. The exams include objective (multiple choice) and discussion questions. The chapters that are included on the exams are listed in the Class Schedule. Note that Exam 3 has a cumulative section. Class Participation: Your class participation grade will be based upon your contributions to class and web discussions and your participation in class projects and project reports. Keep good notes on the class projects and discussions for the exams. Please visit the course website to participate in the discussions. These discussions will comprise 4 points of your class participation grade and must be completed when due. Classroom Computers: This course will include several in-class computer exercises. However, the notebook computers are to be used for course work only and should remain closed during lectures and discussions. Loss of class participation points may result from using the computers for purposes other than those specified. I am interested in your opinions on the exercises and projects as learning tools. You may include your comments in the discussion sections of your reports. Consumer Research Exercises While it is important for marketers to have a foundation in the theories of consumer behavior, it is also important to understand how the theories are applied using research methods. Marketers routinely make decisions about various aspects of consumer behavior. These decisions should be based on the proper interpretation of data. Consumer data are available from a number of sources. However, it is often necessary for a marketer to collect data for specific decisions because existing data are insufficient. These exercises are intended to provide the student with experience using different types of data for marketing decision-making and provide a framework for proper consumer research techniques. Eight exercises will cover the following areas: 1. Examining the Consumer Research Process 2. Exploring Secondary Consumer Data 3. Using Syndicated Data 4. Exploring Qualitative Research Methods 5. Developing Rating Scales in Consumer Research 6. Demonstrating Research Results with Descriptive Analysis and Graphical Displays 7. Examining Basic Relationships 8. Applying Simple Experimental Design and Hypotheses Testing Application Projects An overview of the Application Projects is presented in the following pages. The format and further details for each project will be discussed as the semester progresses. Due dates are listed on the class schedule. Note: Projects 1 and 2 may be conducted as group projects (limit 3 students per group). Please consider the following if you are thinking about working in a group. If you have any doubts, do the project alone. 1) Select group members carefully. (You don't want to get stuck doing all the work!) 2) The specific contributions of each group member must be documented in the report. 3) The quality of the report must reflect the size of the group. 3 Project 1- Segmentation: Segmentation is one of the most important concepts and tools in marketing. Products are developed and positioned in response to the needs of specific groups of people. As we progress through the chapters you will become aware of more segmentation variables. These variables include demographics (e.g., age, sex, income), psychographics (e.g., attitudes, interests, opinions), situations (e.g., time, social, physical, etc.) and transaction (e.g., frequency of purchase, brand loyalty, etc.). An objective of this project is to select a market and explore the usefulness of potential segmentation variables. 1. Select and research a product category based on your interest or experience. You may select products that are goods or services in either the consumer or business-to-business market. The range of categories is very broad such as; skis, cosmetics, mountain bikes, fast foods, car audio, computers, furniture, financial services, hospitality, not-for-profit arts centers, etc. If the product already shows extensive segmentation, for example, automobiles select a “sub-segment,” such as sports cars. You should select a product category with sufficient research sources. When gathering information about your market use library sources (e.g., Business Week, WSJ, Ad Age, MRI database, etc. ) that are no older than three years if possible. You should have at least thre current sources. (Company websites are not considered research sources.) You must cite any sources in the body of your paper in Chicago, APA or another suitable manuscript style. (The journals of the American Marketing Association use a variation of the Chicago style.) http://www.liu.edu/cwis/cwp/library/workshop/citation.htm In order to understand the market, you may also have to examine trade publications, contact trade organizations and examine websites. You may also want to interview people in the industry such as retailers and product managers for their insights. 2. Outline current brands, product features, distribution channels, prices, and promotion. A table is good way to outline products in the category. A representative sample is adequate. It is not necessary to describe all products in the category. 3. Speculate on existing targeted segments based on current market characteristics. Nearly every product category has been segmented in order to target the needs of customers more effectively and efficiently. You should be able to speculate on existing segments based on the marketing programs in the category. For example, by looking at price, promotion (especially ad content), distribution channels and specific product attributes, you should be able to determine the target groups. 4. Review demographic, psychographic and behavioral variables. Determine if there are segments that are not being adequately served. You should systematically review variables (see the text for a list of segmentation variables) and provide evaluations relevant to market conditions. A table listing variables and your evaluation of the relevance of each variable should help organize your analysis. 5. Based on your analysis, identify at least two of these underdeveloped market segments. Review your analysis of the existing segments, marketing mixes, and relevant variables to determine whether there are segments that are not being adequately served. How would you determine the viability of these segments? 6. Discuss implementation for the underdeveloped segments. Determine how you would start to develop a marketing mix for the underdeveloped segments. Assuming that the segments you have identified are underserved, speculate on pricing, product attributes, promotions, and distribution for these segments. 4 Project 2 - Brand Positioning: The objective of this project is to examine how marketers determine consumer perceptions of their product relative to competitors’ products. Brand positioning is based on characteristics of a product such as quality, price or an attribute specific to the product category (power, smoothness, sweetness, etc.). Marketers develop positioning maps as a means of monitoring the effectiveness of marketing strategies and tactics. You should use an online survey (e.g., Surveymonkey.com) to collect data for this project. We will review online survey methods in class. For this project select a product category from the list below and develop a positioning map. One of the requirements of this project is to compare the positioning of brands in two target groups. Find as many brands as possible by going to stores, looking in catalogs, searching online, etc. Choose at least 5 of these brands to study. Select at least four product characteristics, (e.g., prestige, quality, taste, price, style, image, effectiveness, features, etc.) that you feel are relevant to your product category. Develop a rating scale for the perceived importance of these characteristics. Then develop a rating scale question for each characteristic that allows respondents to express where they feel each brand falls on a continuum. Sample at least ten respondents from two different groups (20 respondents total), for example, users-nonusers, young-old (sample must be older than 18 years), males-females. In your survey ask respondents to rate the importance of each characteristic when purchasing a brand in the category and then ask respondents to rate each brand on the characteristics. Calculate the means of the importance ratings of the product characteristics. Using the two most important characteristics develop an X-Y plot in Excel or another program to map the means of each brand and both groups. Colors, symbols or transparencies can be used to differentiate between the groups on the map. Your report should include the following: 1) Brand selection rationale (secondary data such as market share may be available.) 2) A rationale of why the characteristics you selected are relevant (secondary sources may be used.) 3) Group selection justification 4) A description of your data collection procedure with the table of means 5) Positioning map (X-Y plot) for the two most important characteristics (using Excel or another program) 6) A discussion of how the brands compare across groups 7) A detailed discussion of what this map may mean to a marketer 8) Copy of the rating scales and raw data table (in Excel or other spreadsheet program) 9) The link to your online survey Select the product category ONLY from the following list: coffee, moisturizers, chewing gum, dress shoes, handbags, car audio system. You may also use the product category of your segmentation project. *** Hints: Select brands that you think your groups will perceive as being different on the characteristics. This will increase the chances of obtaining a positioning map with brands dispersed in several regions. If brands are clustered in one small region of the map, interpretation will be more difficult. You might want to conduct an Internet and library database search to gather more information about the brands that you have selected. 5 Project 3 - Hypothesis Testing: In order to effectively meet consumer needs, marketers often make comparisons of different marketing stimuli and different target groups. Product-form variations, versions of ads, alternative retailers, and pricing levels are compared to determine which are most effective for specific target groups. The purpose of this project is to apply marketing or behavioral science theories to test a hypothesis about a marketing situation. All students are expected to contribute to this project. As a group we will evaluate various situations, relate the situation to existing theory, develop hypotheses, collect data, analyze the data, and develop conclusions about our study. 1) Select a marketing problem or situation. Ad Age, Business Week, WSJ, etc., are good sources for current marketing problems or situations. We may also contact local companies to explore the possibility of conducting a study relevant to a problem or opportunity they are encountering. For example, past classes have examined consumer attitudes to different packaging, the effects of the gender and age of an endorser on product acceptance, brand loyal in young and older consumers, and the effects of price on the perception of product quality. One of the situations we will consider this semester is the effects of country of origin of products on consumer price perceptions. 2) Examine theories presented in your text or lectures that are relevant to the marketing situation. For example a number of theories discussed in the text may apply, such as perception of salient cues, reference group identification, lifestyle models, and learning theories. 3) Apply the theory to the situation by developing a hypothesis. For example, we could hypothesize that a target group would be more responsive to an endorsement made by a person similar to them. Variations in learning and reference group identification could contribute to how strongly a target group responds to a peer endorser. Reference groups may influence younger consumers to a greater degree. From the perspective of a marketer, it would be valuable to know which factors consumers feel are important in selecting products in a particular category. 4) Develop a specific method to test this hypothesis to yield results that would be meaningful to the marketing problem. For example, we could conduct a study comparing preference to two product positionings; one stressing a particular product attribute (e.g., price, durability, convenience) and one communicating group identification with the product. To elaborate, the responses to the ads by two different groups of consumers could be compared. It is important to develop a testing method that eliminates the effects of extraneous factors, so that findings can be attributed to the characteristics under examination (product attributes vs. group identification) and not to other factors such as how the questions were asked or the format of the ads. 5) Collect data from appropriate sample and compute appropriate descriptive and inferential statistics (e.g., ttest, Chi-square, sign test, etc.) to test the hypothesis. Students are responsible for collecting data (10-20 respondents) entering data into a computer spreadsheet and performing statistical analyses. 6) Discuss potential marketing application and any limitations of the study. 6 Project 4 - Consumer Journal: What factors affect your decision-making process in the selection of low and high involvement products? The objective of this project is to gain insights about consumer behavior from examining your own behavior. Additionally, this project may help you become a better consumer. Document as many factors as possible that influenced product evaluation before purchase, at the time of purchase and after purchase. What was the weight of advertising, peer influence, direct inspection, outside evaluation, past experience, etc. Did taking this course in Consumer Behavior modify your decision-making process for some products or make you more aware of influencing factors? Record the dates that you were exposed to or sought out information about the product. Also indicate if you detected the influence in retrospect, that is, after it had an effect. Log information on at least 2 low involvement and 2 high involvement products. The report should be divided into five major sections (1 for each product and a discussion section) and be organized as follows: For each of the four products include: A) Influencing factors and your response before, during and after purchase B) Chronological recording (dates of actions and influences) C) Your consideration about paying for the product and method of payment (cash, credit, debit, etc.) Discuss the following: A) The difference between high and low involvement products B) How concepts discussed in the course relate to your behavior and cognition C) If and how taking this course in Consumer Behavior affected your behaviors or cognition ***Hint: Start recording your purchase process early in the semester. Your grade on this project is partially dependent on how well your journal is detailed and chronologically sequenced. If you are not making a high involvement purchase in the next few months, you can search for a product that you intend to purchase in the near future. Do not base this project on previously purchased products, only products purchased during the semester should be used. 7 POINT BREAKDOWN REQUIREMENT POSSIBLE EARNED Project 1 (Segmentation) Project 2 (Brand Positioning) Project 3 (Hypothesis Testing) Project 4 (Consumer Journal) 10 10 6 8 ______ ______ ______ ______ In-class exercises (8 exercises @ 1point each) 8 ______ Exam 1 Exam 2 Exam 3 14 14 15 ______ ______ ______ Class Participation 15 ______ -----------------------------------------------------------------------------------------------------------------------------------------------TOTAL 100 ______ GRADING Please keep record of your earned points. Points earned on Projects have traditionally been higher than points earned on exams. No extra credit points will be given for any additional work unless formally announced in class. Final grades will be based on total earned points as specified below. (In order to determine what your grade is during the semester, divide your earned points by the possible points and refer to the table below.) 100-95------------- A 94-90------------- A89-87------------- B+ 86-83------------- B 82-80------------- B79-77------------- C+ 76-73------------- C 72-70------------- C69-67------------- D+ 66-63------------- D 62-60------------- D<60---------------- F 8 MKT 310 CONSUMER BEHAVIOR COURSE SCHEDULE Spring 2008, TR, 8:05-9:45am Section 01 Any Schedule Changes Will Be Posted on the Course Website WEEK DATE Tues,Thurs CHAPTERS, DISCUSSION TOPICS AND PROJECTS DUE 1 January 22, 24 Course Orientation, Chapter 1, 2: Introduction and Consumer Research Not-for-Profit Organizations, Project 4 Review 2 January 29, 31 Chapter 2, 3 Research, Market Segmentation, Project 1 Review Exercise 1 February 5, 7 Chapter 4 Consumer and Organizational Motivation Exercise 2 February 12, 14 Chapter 5 Personality & Consumer Behavior Exercise 3 5 February 19, 21 Review Chapters 1-5, Exam 1 Exam 1 2/21 6 February 26, 28 Chapter 6 Consumer Perceptions of Goods and Services Project 2 Review Project 1 Segmentation 2/28 7 March 4, 6 Chapter 7 Consumer Learning Exercise 4 March 11, 13 Chapter 8, 9 Attitudes, Communication, Project 3 Review Exercise 5 3 4 8 Spring Break March 17-22 9 March 25, 27 Chapter 10,11 Reference Groups, Family Influences & Social Class Project 2 Brand Positioning 3/27 10 April 1, 3 Review Chapters 6-11, Exam 2 Exam 2 4/3 11 April 8, 10 Chapters 12, 13 Culture & Subculture Exercise 6 April 15, 17 Chapter 14 Cross-Cultural Behaviors, Finalize Project 3 Exercise 7 April 22, 24 Chapter 15 Consumer Influences & Diffusion of innovations Exercise 8 14 April, May 29, 1 Chapter 16 Consumer Decision Making Project 3 (Data Due) 4/29 15 May 6 Hypothesis Testing Project Analysis Exam 3 Review Project 4 Consumer Journal 5/6 12 13 Exam 3 is scheduled for Tuesday, May 13, 11:00am- 1:30pm 9