Essay on Marketing and Consumer Psychology
Discussion 1: Priming and Consumer Behavior
Priming is the effect of the impact of the foregoing information on the subsequent without active human intervention or, in other words, the activation of specific associations in memory. Using priming effects in groceries marketing is based on creating the impression of freshness and naturalness of products starting from the entry into the store. Thus, in Martin Lindstrom’s (2011) example with Whole Foods, the owners placed fresh flowers and vegetables at the entrance to the supermarket in order to make the primary impression of goods quality in the store as a whole. Having seen definitely fresh foods at the entrance, people transfer the feeling of freshness to the rest of products in the sales area. The use of symbols of purity like water drops and ice contribute to the overall effect, as well as the color associations, which we will further discuss in more detail.
Indeed, using colors with certain symbols and color combinations to create a certain image is applied effectively today to attract the attention of consumers in both the design of retail areas, packages of goods and means of in-store advertising, and display of goods. Studies show that colors appeal to people’s senses rather than logic: 80% of light and color is perceived by the nervous system and only 20% by vision (Haugtvedt et al., 2008, p. 361). Thus, influence of color on consumer choice can be illustrated by the following experiment (cited in Haugtvedt et al., 2008, p. 367-68). Housewives were given four cups of coffee to taste standing next to the boxes of brown, blue, red and yellow color. Coffee was the same in all the cups, but tasters did not know that. Results showed that 75% of participants noted that the coffee standing next to the brown box, in their opinion, was too strong. About 85% of the subjects found the coffee standing next to the red box most fragrant and tasty. Almost all claimed that the coffee standing next to the blue box was mild, and the one that stood next to the yellow box was weak.
In particular, Whole Foods actively uses green as the color of nature and harmony because its light hues directly symbolize freshness, as well as meet the desires of buyers to compensate for the lack of vitamins, fresh fruits and vegetables. Banana growers use a similar mechanism in the example cited by Lindstrom (2011). In general, we can conclude that food marketing becomes more successful with proper use of the color pallet which eventually becomes the corporate identity and causes persistent associations based on previous experience.
Discussion 2: Personal Branding
In the information age recommendations on creating a brand become important not only for material goods, but also for individuals. With respect to the personality, brand can be defined as a stable set of associations, the image formed in the perception of the surrounding people. It is worth saying that the definition of personal brand, in general, does not differ from the definition of product brand. For example, Chanel perfume is associated with aristocracy, refinement, high price, and personality of Coco Chanel. For connoisseurs of opera baritone Hvorostovsky is associated with a beautiful voice and a bright appearance, the mind immediately recollects such characteristics as the star of the world opera, the soloist of the leading opera houses in the world, as well as the arias he performed in the memory. In both cases there are strong associative images. If the ultimate goal of product brand is to increase profits in the long run, the personal brand depending on the scope of application, in addition to capitalization, may still pursue other goals. For example, a presidential candidate must create a positive and holistic image to make the voters believe and vote in one’s favor. But all in all, the ultimate goal of personal brands is recognition in a particular environment, high reputation, relevance, popularity and increase of the value in the labor market.
Indeed, personality brands are subject to the same rules and use the same benefits as product brands: their product sells better, their services are paid higher, they have weight in society and respect of others, they are listened to, and trusted. For example, advertising a particular product, a celebrity actually indirectly vouches for its quality. Typically, this proven strategy brings good fruit to companies, because consumers are more willing to trust the information received from a famous (in other words, almost familiar) person. However, personality brands are not only media persons or celebrities. Professionalism in any field today is regarded as a marketable commodity, and the professional as a brand. Thus, in case of looking for a new job, I would first try to answer a question whether it is authentic to make the CV in the same way as 999 000 others, and then would make efforts to construct my personal brand through applying Dan Schawbel’s three obligatory elements of: value proposition, differentiation, and marketability(Schawbel & Buckingham, 2013).
Discussion 3: The Effectiveness of Online Marketing
Today, companies are starting to use online solutions for all types of marketing tasks from creating awareness to after-sales services, and recognize that online tools are important and effective parts of the marketing strategies. Internet combines the interactive nature of communication, hypermedia nature and the possibility of establishing individual interaction. Global computer network has become both a new communication environment and the market with tens of millions of potential customers with a sufficiently high income level. The main advantages of internet marketing are considered interactiveness, opportunities for most accurate targeting, possibility of post-click analysis which leads to the maximization of indicators such as Site Conversion and ROI of the internet advertising. Moreover, marketers claim that online tools help them achieve marketing goals throughout their clients’ decision-making process, sometimes in ways that are not consistent with the general ideas of certain tools should be used.
As a result, according to the recent survey of CEOs, in the next three years they are most likely to plan to increase the advertising budget for Online Marketing, in particular, for search and video advertising, while budgets for media advertising and mailout are less likely to be increased (Scott, 2013, p. 113-115). In this perspective, the relevant question occurs of how to raise online marketing efficiency through the use of constantly updating mechanisms in the spirit of dynamic online audience. For example, involving social media in the communications process the companies should offer its readers/subscribers not the end sale, but something more interesting and useful, representing a “transactional” action in the buying process (Scott, 2013; Lindstrom, 2011). For example, if you sell cars, offers applications for test drives through your social media platforms, if you are selling training courses, invite for a free lesson, if you sell consumer electronics, promise a discount coupon, for complex B2B hardware fix number of downloads of brochures and price sheets, etc. In addition, it must be remembered that a robust interaction in real time allows producers to not only respond to comments and feedback of buyers, but also develop the right reputation policy. The brand’s reply to a user’s question or a comment is more important than the comment itself, because the producer’s reaction is the attitude of the brand to consumers that forms buying activity and brand loyalty.
Discussion 4: Online Distribution
For quite a long time, the famous Internet retailer Amazon has been intensively testing the fresh food delivery service Amazon Fresh, thus capturing another niche in the market and competing with major players like Wal-Mart.com or Alice.com. Expanding into new segments allows the company to declare itself as a retailer with the largest range of products offering to purchase any type of product not leaving the house.
The very idea grocery-shopping online is absolutely in the spirit of the time: it saves time and, depending on local prices, might save money. According to data from Tesco, the share of online food sales in the UK in 2009 accounted for about 3% of the total retail sales of food, while in 2014 online sales of food products are expected to increase to 5.5%, due to the fact that the growing number of consumers begins to positively evaluate the advantage of delivering, wide range, and affordable prices in the online grocery stores (Scott, 2013, p. 159). However, by now Amazon Fresh is mostly presented by third-party sellers, which makes their prices incompatible in many cases, especially if Wal-Mart coupons would be taken into account. In addition, unlike Amazon that doesn’t take back groceries or personal care items, Wal-Mart allows its consumers to return anything bought online to a local store within 90 days. At the same time, willingness to sell products with delivery is a proof of the high level of responsibility that cannot be achieved without special equipment, which involves the use of trucks with refrigerators and sealed compartments, special boxes for food storage, quality control at all stages. Together with attractive wholesale prices and direct manufacturer offers, these advantages of large retail chains are designed to ensure higher customer loyalty in the nearest future.
Discussion 5: “Free” Marketing
According to behavioral economists, neuro-marketers and copywriting experts, the word “free” has a huge impact on the buyer. Studies show that consumers cannot help noticing it, miss it or pass it by (Haugtvedt et al., 2008, Lindstrom, 2011). The word “free” literally means that “something is offered for nothing” and even though deep down people perfectly subconsciously realize that nothing happens for no reason and the company certainly gets benefit from something else, every time they hope that “maybe it is really so this time.”
An interesting example of the impact of the word “free” on consumers was demonstrated in Billund, the international airport in Denmark (Scott, 2013, p. 205). The company decided to carry out the split testing the call to action located on the fourth menu button of their online store, which was proposed to change from “Buy online” to “Buy Tax-Free.” Buy Tax-Free in this example meant buying without local Value Added Tax (saving 7-22%). Eventually, the second version showed better results, and surpassed the first one by 49.85% in CTR.
Practice shows that neutral inscriptions “Buy online” or “Order delivery” do not have any clearly defined economic or emotional effect: they just speak for themselves causing no special feelings, not showing benefits to the client, do not disclose the advantages. In turn, basing on Haugtvedt et al. (2008) research, the phrase including the word “Free” (tax free, free shipping) has many advantages: 1. Thoughtful valuable offer (assertion giving the user a complete picture of why one should buy a product or use the services of the company); 2. Competitive advantages (better offer capable to interest an online user who surfed today the entire Internet far and wide in search of the best prices and offers); 3. Demonstration of care for buyer’s benefits. This impact on the consumer’s psyche makes the technique of using the effect of the word “free” one of the most effective in promoting the products, along with the offer of discounts and coupons.
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