CONSUMER

PERCEPTION
Nature & Dynamics of Perception
and Information processing
 Elements Of Perception
 Two people might be exposed to the same stimuli
under the same conditions ------ but they will draw
different meanings out of the same.
 Perception is about “ how we see the world around
us”. Its influenced by a person’s needs, values and
expectations.

 Perception is defined as the process by which an

individual selects, organizes and interprets stimuli
into meaningful and coherent picture of the world.
Information Processing For Consumer Decision Making
Exposure
Random ----------------------------------- Deliberate

Attention
Low involvement ---------------------------- High involvement
Perception

Interpretation
Low involvement ---------------------------- High involvement

Short term ---------------- Memory --------------- Long term

Stored experiences,
Active problem values, decisions,
solving rules feelings

Purchase & consumption decisions

 Information processing
 Information processing is a series of activities –stimuli are
perceived, transformed into information and stored.
 First activity is Perception.
 Exposure occurs when a stimulus (Ad) comes
within range of a persons sensory receptors.
 Attention occurs when a stimulus is received (say
the Ad is seen).
 Interpretation is the assignment of meaning to the
received sensation.
 Memory has short term version just for present
decision or longer term retention of the meaning.
 Elements Of Perception
Sensation: immediate & direct response to
stimuli by the sensory receptors.
 Stimuli include products, packages, brand
names, Ads and other commercials.
 Sensation will depend on the energy level
changes in the environment ( resident of
Mumbai vs. rural Indian).
Sensory adaptation is about “getting used
to certain sensations”, that it loses its impact.
 Brings in the reason for changing campaigns.
Absolute Threshold: the lowest level at
which an individual can experience a
sensation.
Differential Threshold: is the minimal
difference that can be detected between two
similar stimuli is called differential threshold.
 Just Noticeable Difference ( j. n. d.)
 When it comes to product improvements
marketers should meet or exceed consumers
differential threshold.
Dynamics Of Perception
 Sensory world comprises of an infinite number of
discrete sensations.
 As we are bombarded with tens/hundreds of
stimuli every minute ----- Physical stimuli from the
outside environment and Internal stimuli
(individuals desires, motives) based on previous
experiences,
 We sub-consciously get into which stimuli to
recognize and interpret – or in other words----
 Selection, Organization and interpretation of
stimuli.
Dynamics Of Perception

 Nature of the stimulus: nature of the product, its

physical attributes, packaging, design, factors
related to advertising – copy, contrast, models,
positioning claims etc.
 Expectations: people usually see what they expect
to see and what they expect to see is usually
based on familiarity, previous experience or
preconditioned set.
 Motives: people tend to perceive the things they
need or want. The stronger the need the greater is
the tendency to ignore unrelated stimuli.
Stimulus Factors
 Size and intensity of the stimuli

 Colours and Movement of the object


 Position of the object in the person’s vision field
(shelf space, screen/page location etc)

 Contrast from expected / isolation from other

stimuli.

 Interest generated by the stimuli

 Perceptual selection:
 Consumers subconsciously exercise a great
deal of selectivity as to which aspects of the
environment they should perceive.
 Two major factors other than the nature of the
stimuli itself –
 1) consumer’s previous experience as it
affects their expectations and

 2) their motives at that time (needs, desires,

interests etc.)
 Selective Perception

 Selective Exposure:
 Consumers seek out messages that they
find pleasant / which they are sympathetic
with and avoid ones which are unpleasant.
 Selective Attention:
 People have heightened awareness of
stimuli that meet their needs – likely to note
ads of products that will satisfy their needs.
 Selective Perception
 Perceptual Defense: we subconsciously screen
out stimuli that are psychologically threatening,
even after getting exposed.
 (Smokers avoiding the statutory warnings)
 Perceptual Blocking: protect themselves from
being bombarded with stimuli by simply blocking
such stimuli
 Perceptual Distortion: Individuals are subject to
a number of influences that tend to distort their
perceptions –
 Gauging people based on Physical appearance, Sterotyping,
perceptions based on First impressions, Jumping to conclusions,
Halo effect etc.
Perception - Marketing applications
 Positioning: image that a consumer has in
his mind about a product.
 Positioning is actually more important to the
ultimate success of a product than are its
actual characteristics.
 Product repositioning: forced change either
due to competitors activities or due to
change in consumer preferences.
 Perceptual Mapping: shows were the
product stand vis-à-vis competitors brands.
 Perception - Marketing applications
 Perceived Price: how consumer perceives the
price – as high, medium or low.
 Reference prices are prices which consumer as a
basis for comparing/judging another price.
 Internal reference prices are prices / price ranges
retrieved from memory.
 Tensile price claims (save up-to 50%, save 10 –
40%, save more than 25%)
 Objective price claims: save 25%
 Price Bundling
 Consumers are less sensitive to price when they
use credit cards.
 Perception - Marketing applications

 Acquisition utility represents the consumers

perceived economic gain or loss associated with a
purchase
 and is a function of product utility and purchase
price.
 Transaction Utility – concerns the perceived
pleasure or displeasure associated with the
financial aspect of the purchase
 and is determined by the difference between the
internal reference price and the purchase price.
Perception - Marketing applications
 Perceived Quality:
 Consumers often judge the quality of a
product on the basis of a variety of
informational cues.
 Intrinsic cues (physical characteristics of the
product – size, color, flavor, aroma, etc).
 Extrinsic cues are packaging, pricing,
advertising, types of shops were its sold etc.
 Service Quality -SERVQUAL
 Perception - Marketing applications
 Perceived Risk –
 the uncertainty that consumers face when they
cannot foresee the consequences of their
purchase decision.
 Functional risk
 Physical Risk
 Financial Risk
 Social Risk
 Psychological risk
 Time Risk
 Perception - Marketing applications
 How consumers handle risk
 Consumers seek information
 Consumers are brand loyal (avoid risk by being loyal to
the brand which they are satisfied with).
 Consumers select by brand image
 Consumers rely on store image
 Consumers buy the expensive models (when in doubt
consumers buy the expensive models).
 Consumers seek reassurance (when uncertain about
qualities they look for reassurances such as guarantees /
warranties, certifications etc.)
 Perception Learning

External Stimuli
Attitude / behavioral changes

Selective Exposure Immediate consumer Change in knowledge

(Filter 1) action (Leading to structures (classical
out conditioning)
operant learning)

Short term Long Term

Exposure

Memorizing
Selective Attention Perceptual Blocking
(Filter 2) (Filter 3)
out

Socio-cultural
Attention And third party Interpretation
reject Influences (filter 4)
 Consumer
Learning

Elements of Learning, Types of Learned

Behavior and Learning Theories.
 Nature Of Learning

 Information processing consists of exposure,

attention, interpretation leading to perception.

 Learning is the term used to describe the

processes by which memory and behavior are
changed as a result of conscious and non-
conscious information processing.

 Learning is any change in the content or

organization of long term memory or behavior.
 Learning & Consumer Behavior
Culture
Values

Sub-culture Attitudes

Social Class Tastes

Family Purchase
Preferences
&
Friend’s Learning Use Behavior
Skills

Institutions Feelings

Experiences Meanings

Mass Media Behaviors

Advertising
 High Involvement & Low Involvement

 High Involvement learning situation is one in

which the consumer is motivated to process
or learn the material.
 Individual reading the buyer’s guide of a lap
top before the actual purchase.
 Low involvement learning is one in which the
consumer has little or no motivation to
process or learn the material.
 Much of learning occurs in low involvement
contexts.
Low Involvement Learning

 Incidental Exposure
 Typical situation where the reader of an article gets
exposed to the Ads placed next to it.

 An individual who is not interested in clothing

 May notice an Ad featuring a model whom the
respondent greatly admire.
 Similarly he/she may notice clothes ads if they face
a need to buy new clothes soon.
Behavioral Learning Theories

 Conditioning (stimulus-Response Theories) refers

to learning based on association of a stimulus
(information) and response (behavior or feelings).

 Classical Conditioning

 Instrumental or Operant Conditioning

Classical Conditioning
Unconditional Stimulus
(Cricket Match)
Unconditioned Response
(Excitement)

Conditioned Stimulus
(Drinking Pepsi)

Conditioned Stimulus Conditioned Response

(Drinking Pepsi) (Excitement)
Strategic Applications Of Classical Conditioning
 Repetition
 Increases the strength of the association between
a conditioned stimulus and an unconditioned
stimulus and slows the process of forgetting.
 Although some over-learning aids retention, at
some point the individual can become satiated.
 Advertising wear out -both attention and retention
will decline.
 Can be overcome by varying the messages.
 Lux Ads, Marlboro ads
Strategic Applications Of Classical Conditioning

 Stimulus generalization
 Learning depends not only on repetition but also
on the ability of the individuals to generalize.
 That is making the same response to slightly
different stimuli.
 Explains why me-too products exist/succeed in the
market.
 Applied by marketers to product line, product form
and category extensions.
Strategic Applications Of Classical Conditioning

 Stimulus Discrimination
 Opposite of stimulus generalization – consumer
selects specific stimuli from among similar stimuli.
 Positioning concept – unlike the clone who thinks the
consumer will generalize their perceptions, the market
leaders want the consumer to discriminate their stimuli.
 Product Differentiation: strategies aimed at creating
differentiation based on an attribute. This attribute can be
even a trivial one such as colour.
 Its difficult to unseat once the stimulus
discrimination is established.
 Instrumental Conditioning
 Classical learning is most common in low
involvement situations.

 Instrumental or Operant conditioning (B.F. Skinner)

differ from classical primarily in the role and timing
of reinforcement.
 It also require a link between stimulus & response.
 Since no automatic stimulus response relationship
is involved, the subject must be first induced to
engage in the desired behavior.
 Operant Conditioning
 Operant learning differs from classical
conditioning primarily in the role and timing of
reinforcement.
 Suppose Parle brings out a new mango drink which
according to the company has a more natural taste than
Mazza etc.
 How do we prove this to our target audience.
 One approach would be to distribute large quantities of free
samples at supermarkets/ other public places where our
target market is present and thus gain a favorable
disposition.
 Operant Conditioning

Stimulus Desired response Reinforcement

(Mango drink) (consumption) (natural flavor)

Increases probability
Of response to stimulus

 Reinforcement plays a much larger role in operant than it

does in classical conditioning.
 Operant conditioning often involve in the actual use of the
product. Thus a great deal of marketing strategy should be
focused on initial trial.
Operant Conditioning
Try Unrewarded
Brand A (Legs too loose)

Stimulus Try Unrewarded

Situation Brand B (tight in seat)
(Need good
Fitting trousers)
Try Unrewarded
Brand C (Too baggy)

Try Rewarded
Brand D (Perfect fit)

Repeat behavior
 Operant Conditioning
Process of shaping in
purchase Behavior  This process of encouraging
partial responses to leading to
Consume a free sample that the final desired response is
was given to you known as shaping.
 Widely used by marketers,
especially when you have
Purchase a second pack consistent quality product
using the discount coupon
that was given with the
which are superior to products
free sample currently available.
 Rebates, trading of stamps,
freebies like toys etc. to shop in
Repurchase the product a store or to buy a brand,
at full price. providing good ambience, retail
entertainment are all examples.
 Cognitive Learning Theory
 Learning Based on mental activity is called
cognitive learning.
 Unlike behavioral learning theory, cognitive theory
holds that learning involves, complex mental
processing of information.
 Vicarious learning/modeling

 Iconic Rote Learning

 Reasoning / analogy
 Modeling or Observational learning
 Considerable amount of learning takes place in the
absence of direct reinforcement (either positive or
negative)
 Through a process called modeling or observational
learning (or vicarious learning).

 Consumers observe how others behave in response

to certain situations (stimuli) and the ensuing results
(reinforcement) that occur, and they imitate (model)
the positively reinforced behavior when faced with
similar situations.
 Modeling is the process through which individuals learn
behavior by observing the behavior of others and the
consequences of such behavior.
 Advertisers sees the importance in observational learning ,
especially in selection of celebrities or other models.
 A teenager sees an ad that depicts social success as the
outcome of using a certain brand of shampoo – she will
want to buy it.
 A child sees the ad of Sachin Tendulkar drinking Boost –
the secret of his energy and he will also look forward to
have boost.
 Vicarious learning is the basis for much of today’s
advertising.
Cognitive Learning Theory
 Iconic Rote Learning:
 Learning the association between two or more
concepts in the absence of conditioning.
 One may see an Ad that claims that Tiger Balm is
a joint pain reliever and the recipient will add
Tiger along with MOOV and Iodex in his
memory under the pain reliever concept.
 A substantial amount of low-involvement
learning involves iconic rote learning.
 Iconic rote learning – by numerous a
repetition of a simple message that occur as
the consumer scans the environment may
result in the message being learned.
 Through iconic Rote Learning consumer
form beliefs about the attributes of the
product without being aware of the source of
information.
 When the need arises purchase may be
formed based on these beliefs formed.
 Cognitive Learning Theory
 Reasoning / Analogy
 Most complex form of cognitive learning is
reasoning including analogical reasoning.
 Here, individuals engage in creative thinking to
restructure and recombine existing information as
well as new information to form new associations
and concepts.
 It starts with information from a credible source that
questions our existing beliefs.
 New information is considered with the existing
knowledge as the base.
Attitude
Attitude

 An attitude is an enduring organization of

motivational, emotional, perceptual and
cognitive processes with respect to some
aspect of our environment.

 It is a learned predisposition to respond

consistently in a favorable or unfavorable
manner with respect to a given object.
Attitude Components
 Attitudes serve four key functions for
individuals.

 Knowledge function
 Value Expressive functions
 Utilitarian Function
 Ego defensive function
 Perception Learning

External Stimuli
Attitude / behavioral changes

Selective Exposure Immediate consumer

out (Filter 1) action (Leading to Change in knowledge
operant learning) structures (classical
conditioning)

Exposure
Short term Long Term

Memorizing
Selective Attention Perceptual Blocking
(Filter 2) (Filter 3)
out

Socio-cultural
Attention And third party Interpretation
reject Influences (filter 4)