INFORMATION PROCESSING

Presented By: Juhhie Mendiratta

Presentation Agenda
Information Acquisition Perceptual Coding Marketing Implications Stage Model

Consumer Information Processing

It is the acquisition of stimulus inputs, manipulation of these inputs to derive meaning from them and use of this information to think about products and services.

Consumer use this information for: 1. Receive information 2. Organize information 3. Attach meaning to the information 4. Storing information 5. Retrieving information

INFORMATION PROCESSING FRAMEWORK

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Consumer Characteristics Situational Characteristics

Executive System

Acquisition STIMULI

Perceptual Coding

Integration

Outcomes

Memory

Information Acquisition
It is the set of activities of means by which consumers are exposed to various environmental stimuli and begin to process them

This exposure can occur in two ways:

Active search Internal Search: scanning memory for stored information relevant to purchase situation.

This information must have been received from passive method

Example: information from advertising claims, personal experience, product test results, interaction with customers Internal search is deliberate and comprehensive in important purchases In regular replenishment, memory scan is automatic and doesnt even reach conscious mind

Information acquired from internal search is sufficient for consumers needs A decision can be made without seeking any external information External information search depends on 1. Market conditions example: price and feature of different brands 2. Situational factors example: crowd of store, urgency of need 3. Buying strategies that customers adopt

4. Individual factors confidence

example:

level

of

involvement

and

self

Passive Reception
Consumers confront and acquire information in the process of living their daily lives It occurs when consumer acquires information which they are actually not seeking

Zapping: avoiding commercials by switching to other channels with the help of remote control
Zipping: When commercials are fast forwarded with the help of remote control, thus picture becomes distorted with no noise

Awareness Threshold
A stimuli can be either too small or so great that it escapes awareness

Sensation
Absolute Threshold (20 cycles per second) Minimum value of a stimulus capable of being consciously noticed Terminal Threshold (20,000 cycles per second) Maximum value of a stimulus capable of being consciously noticed

Differential Threshold
It is the smallest detectable difference between two values of the same stimulus Consumers threshold exists when consumer notices that the stimulus has changed Difference between this value and starting value is often referred to as the just noticeable difference

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Webers Law
Consumers differ in their ability to detect differences between stimulus values and this varies with conditions Stimulus change needed to reach the differential threshold is a constant proportion of the starting stimulus value.

11 Voluntary

Attention
Stimuli is deliberately focused on because of their relevance to task in hand.

Consumers motives, knowledge and expectations information will be served as a guide to selective attention
Involuntary

about

It occurs when consumer confronts unexpected stimuli that seem interesting or distinctive even though it is unrelated to current goal or activity Example: Funny Advertisement Percentage of involuntary attention is more than voluntary attention

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Characteristics of attention
Consumers can only attend to only limited number of items at one time Example: Five to seven chunks of information Many stimuli require attention and those known to consumers do not need attention

Attention can be allocated to stimuli on a rapid basis

Processing rate is 26 items per second

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Selective attention
Stimulus factors Characteristics of stimuli attract attention such as emotion arousing properties, physically intense values and surprising characteristics Color Contrast Size and position Humour

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Individual factors
Attention span Keep the message simple Adaptation Fresh advertising approaches and offer new and improved products Perceptual Vigilance Consumers pay more attention to marketing stimuli relevant to aroused states example: comparative advertising is more attractive Perceptual Defense Decreasing the awareness of threating stimuli

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Perceptual encoding
Process of assigning mental symbols to sensations Factors influencing the encoding of stimuli 1. Individuals ability to process the sensation 2. Motivation to process the sensation 3. Opportunity to process the sensation

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Stages in encoding process

Feature analysis In this, consumer identifies main stimulus feature and assesses how they are organized Synthesis stage Organized stimulus elements are combined with other information available in the environment and in memory to develop an interpretation of stimulus Three major influences on synthesis stage are: 1. Stimulus features 2. Contextual influences 3. Memory factors

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Categorization process is when a consumer categorizes similar stimuli Consumers perceive degrees of match between any stimuli and a category in which it should be assigned.

Typicality: More a given stimulus is perceived to be typical of a given category, the greater the likelihood that it will be assigned to that category
Depth of processing is the degree of effort consumer spends in developing meaning out of stimuli

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Influences on encoding
Feature Analysis Activities Feature analysis involves mentally arranging sensations into a coherent pattern called as gestalt Figure ground Either the figure appears to stand out as being in front of the more distant background Figure is perceived o have form and to be more substantial than the ground

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Proximity

In organization process, items close to each other in time or space tend to be perceived as being related while separated items are viewed as different Example: soft drinks: fun
Similarity

Items perceived as being similar tend to be grouped together

Closure Consumer organize incomplete stimuli by perceiving them as complete figures

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Factors influencing Synthesis Stage

Learning It helps consumers to categorize stimuli by developing their abilities to identify stimuli attributes used in discrimination Personality Example: fear of uncertainty is curbed by seal of approval Motivation Attitude

Consumers attitudes are thought of as predispositions to understand and respond to objects and events in consistent ways
Adaptation levels

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Marketing Implications
Product Factors Consumers directly evaluate physical product attributes called as intrinsic cues such as shape, size of ingredients

Consumers product perceptions are likely to be influenced by extrinsic cues when product is complex
Certain extrinsic cues are more likely than others to be selected for use in judging products

The way in which extrinsic cues are encoded can strongly influence consumer product evaluations
All extrinsic cues are not encodable by consumers These help consumers in developing additional interpretations of the product

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Price Considerations
Psychological pricing Consumer demand is greater at certain prices and this demand decreases at prices above and below these points Price and product quality Consumer tend to use price as an indicator of the quality or the satisfaction potential of the product Reference prices are not constant but changes with marketing experiences Buyers appear to develop a range of acceptable prices around the standard or reference prices

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Company and store image

A Company Image is the perception customers have as a result of their experiences with it and their knowledge of and beliefs about it A strong and clear company image can increase consumers confidence in its products and their predisposition to purchase them

The way consumers perceive a company change influence their reactions to its offerings
Perception of store image is derived not only from functional attributes of price, convenience and merchandise but also from the influence of variables such as architecture, interior design, etc.

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Advertising issues
Sex in advertising Main purpose is to attract customers attention to the advertisement Consumers predisposition towards sexual themes determine their reaction to the ad Reaction is negative when the member of same sex is used as nude model Sexual theme is acceptable for some products (perfumes, deodrant)

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Subliminal advertising Subliminal messages are those that are transmitted so subtly that the receiver is not consciously aware of receiving them . They are below the threshold limit

It is done in three ways:

1. Present visual stimuli for brief duration 2. Present auditory message at accelerated speed at low volumes 3. Hide images or words in pictorial material

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Stage Model: AtkinsonShiffrin Model

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