Consumer Economics Chapter 7 Decision Making and Advertising

Consumer Economics Chapter 7 Decision Making and Advertising Copyright© 2009 Taylor & Francis Group, an informa business

Learning Objectives Discuss decision making in consumer behavior Explain three main types of decision making Understand advertising in relation to buying decisions and sustainable behaivor Know the pros and cons of advertising in relation to consumers Describe the government agencies that impact advertising Understand the value of social marketing and public service announcements

Introduction Consumers make decisions every day How consumers make decisions is important Advertising influences consumer decision making

Decision Making Takes Time • Decision making is choosing between two or more alternatives • Consumers try to make good decisions; but it is hard to do • Consumer decisions involve trading time and money for goods and services Copyright© 2009 Taylor & Francis Group, an informa business

Three Types of Decision Making Styles Habitual decision making Extended decision making Limited decision making

Theory and Style Preference The role of self-concept Self-esteem Rules of thumb Style Uniqueness theory

What Affects Consumer Decisions? Technological Advances Obsolescence Impulse buying Consumerspace

Advertising and Social Influence Paid communication First, gain their attention Many different types of advertising Placement and timing is important

Advertising is Necessary, but Complex 1. Use of color 2. Repetition 3. Consistency 4. Memory devices 5. Economic pros and cons of advertising 6. Deceptive advertising 7. The subconscious and subliminal advertising 8. Distasteful advertising 9. Infomercials 10. Marketing to children

Government and Advertising The role of the FTC Advertising Legislation Cease-and-desist orders Counter Advertising

Social Marketing and PSAs Uses marketing to solve social problems Social marketing straetgies Public service announcements

Chapter Summary Are consumer decisions rational? Consumers make many complex decisions A multitude of influences Advertising plays role Marketing can hurt and help consumers