CUSTOMER INSIGHTS Benedikt Schnurr, PhD Customer Insights 1 Nature of the Course My Part • Theoretical/Conceptual input • Examples • Structure Your Part • Active participation • Critical and analytical thinking Outcome • Joint discovery & learning Customer Insights 2 Relevant Content Basic Literature Mothersbaugh. D., Hawkins, D., and Kleiser, S. B. (2020). Consumer Behavior: Building Marketing Strategy, 14th Edition. McGraw Hill. Solomon, M. R. (2020). Consumer Behavior: Buying, Having, and Being, Global Edition, 13th Edition. Pearson. Academic Journal Articles (see Syllabus and Moodle) Cases (see Syllabus and Moodle) Customer Insights 3 Session Structure (i) Lecture (ii) Science Insights (iii) Case Preparation (Cases will be uploaded on Moodle) (iv) Joint Case Discussion Customer Insights 4 EXAM Date: tba Nature: multiple-choice More information to come in time! Customer Insights 5 Customer Insights 6 INTRODUCTION TO CONSUMER BEHAVIOR Customer Insights 7 Consumers Are a Strange Breed Customer Insights 8 Consumers Are a Strange Breed https://www.youtube.com/watch?v=_qWHJ29-s4U Customer Insights 9 What is Consumer Behavior? “The study of the processes involved when individuals or groups select, purchase, use, or dispose of products, services, ideas, or experiences to satisfy needs and desires.” Consumer Perspective Marketer Perspective Prepurchase Issues How do consumers decide that they need a product? What are the best sources of information to learn about alternative choices? How are consumer attitudes toward products formed and/or changed? What cues do consumers use to infer which products are superior to others? Purchase Issues Is acquiring a product a stressful or pleasant experience? What does the purchase say about the consumer? How do situational factors, such as time pressure or store displays, affect the consumers’ purchase decision? Does the product provide pleasure or perform its intended function? How is the product eventually disposed of, and what are the environmental consequences of this act? What determines whether consumers will be satisfied with a product and whether they will buy it again? Do consumers tell others about their experiences with the product and infuence their purchase decisions? Postpurchase Issues Customer Insights 10 Applications of Consumer Behavior Marketing Strategy Regulatory Policy Customer Insights Social Marketing 11 Marketing Strategy and Consumer Behavior Market Analysis Company Competitors Conditions Consumers Market Segmentation Identify product-related need sets Group customes with similar need sets Describe each group Select attractive segment(s) to target Marketing Strategy Product, Price, Distribution, Promotion, Service Consumer Decision Process Problem recognition Information search Alternative evaluation Purchase Use Evaluation Outcomes Individual Firm Social Customer Insights 12 Marketing Strategy and Consumer Behavior Market Analysis Company Recognizing firms’ (marketing) abilities (strength/ weaknesses), including NPD, channel, advertising, service, research, consumer knowledge, … Competitors Knowledge of competitors’ capabilities and strategies Conditions State of economy, physical environment, government regulations, technological developments Consumers Knowledge of consumers’ needs and desires and anticipate their reactions Customer Insights 13 Marketing Strategy and Consumer Behavior Market Segmentation Customer Insights 14 Marketing Strategy and Consumer Behavior Marketing Strategy Product Consumers buy need satisfaction, not a physical product Price Consumer cost: everything a consumer must surrender in order to receive the benefits of owning/using a product Communication With whom? What? Where? When? What effect? Distribution How? Where? When? Service Auxiliary or peripheral activities that are performed to enhance the primary product Customer Insights 15 Marketing Strategy and Consumer Behavior Consumer Decision Process Customer Insights 16 Marketing Strategy and Consumer Behavior Outcomes Firm outcomes Product/Brand position Sales and profits Customer satisfaction Individual outcomes Need satisfaction Injurious consumption Society outcomes Economic Physical environment Social welfare Customer Insights 17 Consumer Research Micro Macro Disciplinary focus Magazine usage sample research issues Experimental psychology: product role in perception, learning, and memory processes How specific aspects of magazines, e.g. design and layout, are recognized and interpreted Clinical psychology: product role in psychological adjustment How magazines affect readers’ body images Microeconomics: product role in allocation of individual or family resources Factors that influence the amount of money households spend on magazines Social psychology: product role in the behavior of individuals as members of social groups How ads in a magazine affect readers’ attituds toward depicted products Sociology: product rle in social institutions and group rlationships Pattern by which magazine preferences spread through a social group Macroeconomics: product role in consumers’ relation with marketplace Effects of price of fashion magazines and expense of items advertised during times of economic crises Semiotics: product role in the verbal and visual commnication of meaning How underlying messages communicated by ads are interpreted Demography: product role in the measurable characteristics of a population Effects of age, income, and marital status of a magazine’s readers History: product role in societal changes over time Ways in which our culture’s depiction of femninity and masculinity have changed over time Cultural anthropology: product role in a society’s beliefs and practices How fashions and models in a magazine affect readers’ definition of masculine versus feminine behavior Customer Insights 18 Consumer Trends https://www.mintel.com/global-consumer-trends Health Undefined Collective Empowerment Priority Shift Coming Together Sustainable Spaces Digital Dilemmas Customer Insights 19 Consumer Trends https://www.youtube.com/watch?v=WYcV81Ii3oQ Customer Insights 20 Now, You Know… …what consumer behavior is …how consumer behavior shapes marketing strategy (and vice versa?) …the scientific disciplines that study consumer behavior …consumer trends to look out for Customer Insights 21 SCIENCE INSIGHT Customer Insights 22 Science Insight Barasch, A., Zauberman, G., & Diehl, K. (2018). How the intention to share can undermine enjoyment: Photo-taking goals and evaluation of experiences. Journal of Consumer Research, 44(6), 1220-1237. Customer Insights 23 Introduction Sharing experiences with others can benefit consumers in multiple ways, for example boost their mood and enhance their sense of meaning (Lambert et al. 2013; Reis et al. 2010) Customer Insights 24 Introduction Existing Research on Sharing Experiences This Research Sharing occurs after the experience has ended Effect of anticipating sharing an experience à How do consumers’ salient intentions to share an experience in the future affect their enjoyment of that experience in the present? à How does taking photos with the intention to share them later influence consumers’ enjoyment of an experience? Why focus on photo taking? • Facebook: 350 million photos uploaded every day (gizmodo.com) • Instagram: 1,074 photos uploaded every second (omnicoreagency.com) Customer Insights 25 Theoretical Background Self-presentation concern: • People are motivated to present themselves to others in a favorable light (Goffman 1959) • Social situations induce a desire to control the way people appear to others (Schlenker 1980; Tedeschi 1981) • Taking photos with the intention to share them with others activates a self-presentational motive of communicating desired identities to others (Gollwitzer 1986; Leary and Kowalski 1990). à Taking photos with the intention to share them with others increases self-presentation concerns (an inherently negative state; (Ariely and Levav 2000; Mackie and Goethals 1987), thus undermining enjoyment of the experience à Self-presentation concerns decrease pleasurable immersion in the experience itself, thus reducing enjoyment (Csikszentmihalyi 1997; Killingsworth and Gilbert 2010) Customer Insights 26 Hypotheses H1: Relative to taking photos for the self, taking photos with the intention to share with others will reduce enjoyment of an experience. H2: Relative to taking photos for the self, taking photos with the intention to share with others will increase self-presentational concern. H3: Self-presentational concern will diminish enjoyment both directly and indirectly through reduced engagement in the experience. Customer Insights 27 Study 1: Photo Taking at a Tourist Attraction Participants and design: 153 participants approached in front of the Rocky Statue in Philadelphia, who ere about to take a photo Measures: Independent Variable: Photo taking goal (for myself/to share with others) Dependent Variables: Enjoyment of the experience (1 = not at all, 15 = extremely) Recommendation intention (1 = not at all, 15 = extremely) Results (logistic regression): Enjoyment of the experience: B = –1.54, p < .01 Recommendation intention: B = –1.21, p = .05 à When individuals take photos to share, they enjoy the experience less than when they take photos for themselves. Customer Insights 28 Study 2: Field Experiment Participants and design: 440 students were asked to create a Christmas holiday album either for themselves or to share on Facebook Measures (survey distributed after holidays): Enjoyment of the Christmas photo-taking experience (1 = not at all, 7 = extremely) Results (independent samples t-test): Enjoyment of the experience: Msharing goal = 5.15 vs. Mself goal = 5.58; p = .01 à When individuals take photos to share, they enjoy the experience less than when they take photos for themselves. Customer Insights 29 Study 4: Moderation by Self-consciousness Participants and design: 289 participants watching a first-person walking tour through Carcasonne were asked to imagine either taking photos for themselves or in order to share them with others Measures: Enjoyment of the experience (1 = not at all, 7 = extremely) Self-consciousness (13-item scale) Results (regression analysis): Enjoyment: b = –.60, p = .001 Interaction: b = –.10, p < .01 Sharing goal: self-consciousness à enjoyment: b = –.07, p < .01 Self- goal: self-consciousness à enjoyment: b = .03, p = .24 à For those who take photos for themselves, self-consciousness is not related to enjoyment. However, for those who take photos to share with others, being higher in selfconsciousness is related to lower enjoyment during the experience Customer Insights 30 Study 5: The Effect of Sharing with Different Audiences Participants and design: 153 participants experiencing a virtual London bus tour were asked to either take photos for themselves or in order to share them with close friends or to share them with acquaintances Measures: Enjoyment of the experience (1 = not at all, 7 = extremely) Self-presentation concerns (three-item scale) Engagement in the bus tour (two items) Customer Insights 31 Study 5: The Effect of Sharing with Different Audiences Results (one-way ANOVAs): 7 6 4.92 5 SP concerns: F(2, 150) = 4.99, p < .01 3.30 4 3 Enjoyment: F(2, 150) = 3.96, p = .02 5.6 5.55 Engagement: F(2, 150) = 6.77, p < .01 2.90 2.74 2 1 Self Distant others Enjoyment Close others Self-presentation concern Customer Insights 32 Discussion Contributions Research on sharing experience (Lambert et al. 2013; Reis et al. 2010; Tamir and Mitchell 2012): Previous research: effects of sharing after an experience This research: intention of sharing an experience during an experience Research on impression management (Baumeister 1982) Identification of hedonic costs of anticipating future self-presentation: seeking future utility from sharing photos can diminish hedonic utility in the present. Research on photo taking (Barasch et al., 2017; Diehl et al. 2016) Previous research: effects of taking versus not taking photos on enjoyment of an experience This research: effects of taking photos for different audiences Future research • Examining how photo-taking goals affect features of the photos • Additional situational variables Customer Insights 33 Now, You Know… …how certain goals while taking a photo can affect the enjoyment of an experience …how to empirically test these effects …how examining these effects contributes to consumer research Customer Insights 34 CASE Customer Insights 35 Case – Alexa Choose two of your favorite brands and devise an idea for an Alexa “skill” that consumers could find useful. How would these skills help sell more of the brands’ products and/or increase customer loyalty? How can brands remain relevant in the Age of Alexa? What strategies should brand managers employ to continue to influence consumer purchase decisions if consumers become more reliant on AI assistants? What kind of products or brands will most likely be either negatively or positively affected by an increased use of AI assistants? Customer Insights 36 THANK YOU Customer Insights 37
