How Consumers Act and React /
Consumer Behavior
How Consumers Act and React / Consumer
Behavior
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How consumers really shop
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12 seconds at a product category
85% picked up only one brand within a category
90% only picked up one size
58% paid attention to the price
point of purchase / in-store displays signal special price
Consumer Decision Making (John Howard)
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Problem recognition
Information search
Alternative evaluation
Purchase
Post-purchase outcome / evaluation
How Consumers Act and React / Consumer
Behavior
 Influences on Consumer Behavior
 Surroundings: Advertising, sales promotion,
friends, family, salespeople, store, price, past
experience, etc.
 Outside Influences
 Culture:
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Nestle Cup of Noodles in France example - Convenience
McDonald’s German Drive Thru
 Opinion Leaders
 Internal Influences: within the individual.
Learning style, memory, modeling.
How Consumers Act and React / Consumer
Behavior
 Maslow’s Hierarchy
of Needs
Self Actualization
Esteem
Belongingness and Love
Safety
Physiological Needs
Place: Evian, Volvo, Just My Size pantyhose, Red Bull
How Consumers Act and React / Consumer
Behavior
 Consumer Behavior: understanding the
psychology of what is going on in the
consumer’s head.
Consumer Research:
 Step One: define your question!
 Otherwise you are simply going fishing
and this ocean is too big.
 Step Two: What kind of research do
you need?
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Quantitative
Qualitative
Secondary
Primary
Consumer Research
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Use Secondary Sources
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Company Records
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Annual Reports, customer profiles, public relations files,
technical reports (what brand is 99 44/100% pure?)
Trade Associations
Libraries
Sources of statistical Information (Government publishing
offices responsible for Census, etc.)
Company Stock Reports
Market Guides
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MediaMark Research (MRI) demographic & psychographic
info on light, medium and heavy users of products.
Simmons (SMRB) similar to MRI
Survey of Buying Power: geographic breakdown of
demographic splits of the US population
Computer based databases (e.g. InfoTrac)
Web sites: (e.g. Hoover’s online)
Consumer Research
 Primary Research
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Observation
Focus Groups
One - on - Ones
Survey
Psychographic research firms
Consumer Behavior
 Culture: a distinctive way of life of a group of people –
their complete design for living.
 Typical American Cultural Traits:
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Belief in the sovereignty of all people
Equality for all
Individualism
“Worship” of schooling
Love of size / bigness
Adaptability / open to change
Optimism
Humanitarianism
Mobility / “restlessness”
Practicality
Emphasis on making money
Self-protection and the sanctity of life.
Consumer Behavior
 Does America have
a class structure?
Consumer Behavior
 A rich man is not just a poor man
with more money. He has different
ideals, different personality forces,
different church membership and
different notions of right and wrong
all stemming from social class
differentials.

Pierre Martineau Motivation in Advertising
Consumer Behavior
 America’s Class System:
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Upper-upper Class: (0.5%) locally
prominent families, 2-3rd generation
wealth, living graciously, upholding
the family name, reflecting the
excellence of one’s own breeding
and displaying a sense of
community responsibility.
Consumer Behavior
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Upper-upper Class: (0.5%)
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#21, Newhouse, Donald Edward
73 , inherited and growing
Source: Media/Entertainment, publishing
Net Worth: $7.7 billion Hometown: Somerset County , NJ
Marital Status: married , 3 children
Undergraduate: Syracuse University, Drop Out
With brother Samuel Irving Jr., two sons of Sam Newhouse, who took over failing Staten
Island Advance 1922 and built what became the nation's largest newspaper chain. Sons
inherited Advance Publications after father's death in 1979. Donald runs newspapers
(Cleveland Plain Dealer, Newark's Star-Ledger), Si oversees glamorous Conde Nast
magazine division (Vogue, Vanity Fair, the New Yorker). Also owns Sunday newspaper
insert Parade, Fairchild Publications (Women's Wear Daily).
Consumer Behavior
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Lower Upper Class: (1.5%)
newly rich (nouveau riche).
Newly arrived and never
quite accepted wealthy.
 Each city’s executive
elite, founder’s of large
businesses and newly
well to do Doctors,
Lawyers.
 Their goals are a
combination of gracious
living and drive for
success.
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FYI: There are 2.2MM
millionaires in the US (>
1%).
Consumer Behavior
 Upper Middle Class:
(10%) Moderately
successful.
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Owners of medium sized
businesses, management
level executives and young
people (25-30) that are
“expected” to reach
management level.
Goal is career success,
tend to reflect that success
in home décor, social &
cultural participation.
They “want” to be part of
the upper classes which is
defined by greater net
worth.
Consumer Behavior
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Lower Middle Class:
(30 – 35%). Small
business owners &
highly paid blue collar
workers.
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Major goal is
“respectability” and
being accepted.
Live in neatly furnished
well maintained modest
homes more or less on
the “right side of town.”
Save for college
education for their
children.
Consumer Behavior
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Upper Lower Class:
(40%) Semi-skilled
production-line workers
and retail workers.
 Goal is enjoying life
and living well day to
day.
 They strive to be “up
with the times,”
fashionable with the
goal of living more
comfortably.
Consumer Behavior
 Lower – lower Class:
(15-20%) unskilled
workers, unassimilated
ethnic groups & the
sporadically employed.
 They have only 7-8%
of the total
purchasing power.
 Apathetic, fatalistic,
get their “kicks” while
they can.
Consumer Behavior
 Upper-Upper Class: Consume little, belongings are
inherited.
 Lower-Upper/Upper Middle: all possessions are
new. Foreign cars, sailboats, prestige through
acquisitions. Good schools, “the right” summer camps
for the kids, music lessons, etc. Purchase more than
any other single group.
 Lower Middle: price shopping, tend not to “want to
move” social groups so if they have extra money, they
buy a better house in the same neighborhood, better
clothes, etc.
 Lower classes: future is uncertain so they buy
heavily on impulse. Like to watch TV and go to the
movies, not really “readers.” Credit!
Consumer Behavior
 Family Life Cycle:
1. Bachelor stage: young single, no children
2. Newly married couple: young, no children
3. Full Nest 1: young married couple with
youngest child under 6
4. Full Nest 2: young married couples with
youngest child over the age of 6
5. Full Nest 3: older married couples with
dependent children
6. Empty Nest: older married couples with no
children living with them.
7. Solitary Survivors: Older single people.
Consumer Research
 ACV: All Commodity Volume
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A measurement of distribution in relation to sales.
gives the total amount of sales in a given category.
Example: a brand is said to have an 80% ACV if it is available
for sale in stores which make up 80% of the category sales.
 If Pantene has a 90% ACV, it means it is available in stores
where 90% of all shampoo products are sold; not 90% of
stores.
Consumer Research
 CDI: Category Development Index
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Way of comparing a local or regional sale of a product category
vs. national (which is always 100)
Percentage of total sales that occur in each geographic region
presented as an index.
 Example: BBQ sauce may have a 200 CDI in Texas which
means Texans consume twice as much BBQ sauce as the
average American.
 The higher the CDI, the stronger the category in that
particular region. The lower the CDI the weaker the sales
in that region.
Consumer Research
 BDI: Brand Development Index
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The comparison of brand sales indexed against total product
sales calculated on a geographic or other basis.
Let’s you know how strong your sales are in a particular region
vs. average sales in the US (index 100)
 Example: Pantene is the largest shampoo in the US and
has a 125 BDI in Chicago. This means that Chicago
consumers use 25% more Pantene than the average
American.
Consumer Research
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Understanding how ACV, CDI and BDI are actually
used.
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ACV: marketers generally want a high ACV to guarantee their
product is available in the places where consumers normally
buy the category. New product introduction usually require a
certain ACV level before they will begin promotional spending
(why spend before consumers can find the product to buy?)
CDI: Many product categories are highly regional (e.g.
sunscreen) and marketers will want to guarantee they are
promoting their products in markets with the best potential.
BDI: Brands can develop regionally as well (e.g. NYC is a Coke
town, LA is a Pepsi town). So not only is it important to
promote your product in a market with strong category
potential, but you then add your own brand potential on top of
that.
Consumer Research
 The Tricky Questions:
 Will your product likely be more successful in a
city with a CDI of 200 or a city with a CDI of 85?
 Should you spend money supporting your brand
in a market with a 200 BDI or a market with an
85 BDI?
 Where would you rather spend your ad dollars?
 Columbus, Ohio
CDI 200
BDI 50
 Indianapolis, IN
CDI 50
BDI 200
Consumer Research
 Mistakes made in
interpreting the
data
 Going overboard
with research.
 Chrysler “K-Car”
Consumer Research
 Asking the wrong questions.
 New Coke 1985
Consumer Research
 Believing everything people tell you.
People saying the “right thing.”
 Following every trend: Healthy Jell-O!
 Getting the answer you want to hear.
Dissecting the Creative Brief
The most important part of your plan
The Creative before the Creative
 Strategy: “What” you plan to accomplish
 Execution: “How” you plan to accomplish
your strategy.
Purpose of a Creative Brief?
1. To guide the work
1. A Creative brief defines “what” needs to
be created; it doe not tell the reader
“how” to do it.
2. To inspire great work.
The Creative before the Creative
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Some good industry thinking
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Strategy: a carefully designed plan to murder the competition
Any premise lacking a killer instinct is not a strategy
Any premise that doesn’t cry a consumer need is not a strategy
Any premise that addresses the entire world is not a strategy
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O’Toole: three most important things: competition,
target audience, what do you want them to know or
feel?
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DDB Needham’s: What basic human need does your
strategy hit (need to be popular, feel attractive, feel
wanted, obtain material things, safety, enjoy life, create
a happy family situation, etc.
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McCann; write the strategy as the target would write the
strategy
Dissecting the Creative Brief
1.
What do we want the advertising to do?
2.
Who is our target?
3.
What do they currently think?
4.
What would we like them to think?
5.
What is the single most compelling promise we can make them?
6.
How do we make it believable?
7.
Is there anything else worth considering that may help us get to
great creative work?
8.
Are there any executional mandatories?
What do we want the
advertising to do?
 What is the specific job of the
advertising?
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Communication Objective: What do you want to
accomplish as a result of running this
advertising?
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This is NOT a list of marketing objectives (e.g.
increase sales +15%), or a media objective (e.g.
create awareness) but the role advertising should
play in helping you reach your marketing objectives.
Relationship Between Marketing,
Advertising and Media Objectives
Marketing Objective: generally defined as a
sales / success objective
Advertising Objective: the communication
objective that will help you to
reach your marketing objective.
Media Objective: That which you must do
in paid and unpaid media in order
to meet your marketing objective.
Dissecting the Creative Brief
 Who is our target?
 What is a woman 18-49?
 Describe a single person.
 Your goal is to have your team say “I know this
person!”
 Go beyond name and basic demographics /
psychographics help your team understand who she is
(or he), how they think, what they think of your
category / brand currently, what motivates them, what
you believe will make them change their mind, etc.
 If your target has specific opinions about the
competition, include that insofar as it gives insight to
what is needed to change his/her mind.
Dissecting the Creative Brief
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What do they currently think?
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What would we like them to think?
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What do we need them to think in order to do what we want them to
do?
What is the single most compelling promise we can make
them?
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What does the target currently think about the category, the product,
the cause being advertised?
This is a single idea you want your advertising to communicate which
you believe will help your target to change his/her mind about your
product and choose it over your competition.
How do we make it believable?
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A clear, often rational fact which proves your promise to be true.
Creative Brief: example
1.
What do we want the advertising to do?
2.
Who is our target?
3.
What do they currently think?
4.
What would we like them to think?
5.
What is the single most compelling promise we can make them?
6.
How do we make it believable?
7.
Is there anything else worth considering that may help us get to
great creative work?
8.
Are there any executional mandatories?
The Creative before the Creative
 Types of Claims
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Generic Superiority: “no one does a better job”
Preemptive Claim: not unique, but unclaimed by the
competition: e.g.: Mountain grown coffee.
Unique Selling Proposition: true competitive advantage.
Brand Image: superiority through image portrayed e.g.
Nieman Marcus
Positioning: using your claim as your positioning e.g.
“Engineered like no other car in the world,” “the ultimate
driving machine.”
Resonance: attaching your brand to fundamental human
experiences (e.g. birthday, patriotism, marriage, love, etc.)
Dissecting the Creative Brief
 Is there anything else worth considering that
may help us get to great creative work?
 Only if there really is some additional fact, story, item
which will help “inspire” great work.
 Are there any executional mandatories?
 Often used to keep commercials within a certain
“predetermined” campaign. Again, if there are none,
leave it blank!
The Creative before the Creative
 What is a Big Idea?
 More than a selling proposition, more
than a positioning, becomes a rallying
cry for the brand
 E.g. “Think Different” for Apple, “The
relentless pursuit of perfection” for Lexus,
Just do it! for Nike.
What is a Consumer Insight?
 More than research, more than
observation
 the ability to see clearly and intuitively into
the nature of a complex person, situation,
or subject
The Creative before the Creative
 James Webb Young’s Technique
for Producing Ideas
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Immersion
Digestion
Incubation
Illumination
Reality Testing