How Businesses Use Learning and Memory to Affect Consumers - Essay Example

? How businesses use learning and memory to affect consumers BY YOU YOUR SCHOOL INFO HERE HERE How businesses use learning and memory to affect consumers Introduction Studies on human memory illustrate the complexity by which humans encode, store and retrieve information. Encoding involves the receipt of information which is then processed or combined with other stimuli. Storage is the creation of a permanent record of information that has been encoded. Retrieval is the process of recalling information that has been processed in response to a particular cue or stimulus. What makes the study of memory so complicated is that humans have disparate methods by which information is encoded and retrieved, which is largely dependent on the level to which the human finds information relevant and important. Marketers, today, seem to understand these differences in learning and memory processing and generate marketing content (i.e. advertisements, banner ads or even digital marketing via technology) that alter the encoding process of consumers so that they will be better able to recall a brand or find personal preference toward the product or service. Consumers all have different learning processes, however there is research evidence that consumers are biased in learning as it relates to their personal stereotypes as well as the degree to which marketing information is considered relevant to the consumer. This essay focuses on the phenomenon of constraint theory in learning, consumer biases and offers an evaluation of how marketers persuade consumers to favour their brand based on consumer memory processing and learning characteristics of important target consumers. Consumer biases in learning and constraint theory It is the goal of marketers, from a competitive standpoint, to establish brand recognition in the minds of important and profitable consumers. Brand recognition is the ability of consumers to recall a particular brand under disparate conditions and be able to effectively recall logo, brand name and even brand-related slogans and jingles and link this recognition to the product or service (Schiffman and Kanuk 2010). Establishing brand recognition is critical to marketers as if they cannot recall the brand, the brand will not be considered as a potential purchase or sought as an alternative in the consumer behaviour model (Tan 2010). However, in order to establish this important aspect of brand management, marketers must first understand how consumers encode and retrieve information. The memory encoding process is complex in consumers and is often associated with the degree to which a consumer finds a particular stimulus to be enjoyable or relevant to their lifestyles or needs. Encoding processes are strongly related to the pre-existing personal experiences and phenomenon to which consumers are exposed (Yun Yoo 2008; Cameron 1999). For instance, a consumer that is given a glass of branded alcohol in an environment where there is a crying child will likely not result in the production of strong memories that favour the brand. However, when given the same branded beverage in an environment where there is fun social activity in the individual’s peer network, the situation will be encoded as a powerful memory with positive associations between brand and experience (Cameron 1999). Therefore, there is significant evidence in the memory encoding process that a person’s level of interest and involvement determines whether positive or negative cognitive associations are created in the memory encoding and retrieval processes. This is how marketers, today, are able to utilise memory processes in consumer target groups to gain positive brand recognition and general positive sentiment toward a brand. Marketing literature tells business leaders that when a brand is able to provide consumers with a perception that the brand can enhance their lifestyles and provide self-expansion (i.e. social status improvement or lifestyle enrichment), they are likely to develop very strong emotional attachments to the brand (Zhang and Chan 2009). This means, essentially, that consumers are often self-indulgent and seek to find brands that will enhance their standard of living and general way of life. Self-associations with the brand, when considering the encoding process, are important constructs that will determine general brand attitude and the extent to which a brand is recalled. The human propensity to make decisions about a brand based on its level of perceived personal enrichment determines how information is recalled and what type of associations are made with the brand (Greenwald, et al. 2002). Therefore, there is a dimension of motivational influence that determines how consumers encode and effectively retrieve processed information. Blackwell, Miniard and Engel (2006) indicate that consumers are largely aware of the effects of their personal values and personal needs, a conscious process referred to as need recognition. Need recognition occurs when the consumer detects a discrepancy between their current state and a desired state (Blackwell, et al. 2006). This means that consumers are driven by their motivations and value systems and this becomes a variable in the encoding process, which was aforementioned in the example of wine consumption in different environments and when exposed to disparate stimuli. Because of this, marketers must develop advertising or other brand-related content that strikes an emotional chord with consumers if they want the target consumers to select one brand over that of competing organisations. This assessment is supported by psychological theory as it pertains to the learning and memory processes. Desforges and Lings (1998) illustrate the phenomenon of constraint theory, which suggests that humans have considerable biases when encoding information and experiences. Constraint theory posits that if a consumer believes any piece of information is irrelevant, they will shut out this information in the learning process (Desforges and Lings 1998; Markman 1990). Constraint theory teaches that when there are pre-existing biases, any attempt to encode the information with positive associations to the stimuli will be superseded by consumer tendency to block out what they perceive as being irrelevant or unpleasant. The aforementioned phenomenon of constraint theory helps marketers to develop marketing content and communications that are lifestyle-relevant to consumers if they want the consumer to develop brand recognition and ultimately brand preference. More contemporary marketing efforts utilise psychographic segmentation, which is isolating important and potential consumers that will be attracted to a brand based on their attitudes, values and lifestyles (Boone and Kurtz 2008). Since consumers will only encode information positively when it is rather hedonistic (self-indulgent), messages must be pertinent to these factors if a marketer desires a consumer to create positive associations between the brand and the self. This phenomenon can be illustrated by the Pampers brand, a diaper product managed by Procter and Gamble, which had minimal success gaining consumer favour and brand preference utilising a website that devoted the majority of its digital communications on product functionality and innovation. Pampers attempted to position itself according to product quality on its corporate website, however consumers rejected this marketing communication as it did not service their hedonistic needs. After utilising psychographic marketing tactics and market research, Pampers realised that consumers wanted parenting advice from the company and helpful hints on proper child-rearing. Consumers found the product positioning and focus on this aspect of the marketing mix to be quite irrelevant to satisfying their needs which changed the dynamics of how Pampers communicated with and engaged consumer segments. Pampers subsequently created a new website for the brand known as the Pampers Parenting Institute, thereby creating lifestyle connections with consumers and building more loyalty toward Pampers over other competing diaper brands (Hensell 1998). The situation with Procter and Gamble illustrates how companies learn the encoding processes of consumers and the types of biases that occur when a consumer does not believe a brand can enhance their lifestyle or improve self-expansion at the personal level. Consumers found Pampers’ promotional strategies to be irrelevant to needs fulfilment and therefore blocked out important marketing messages that had been developed and distributed by Procter and Gamble in their encoding processes. It was not until the Pampers brand began to develop emotional and lifestyle positioning and promotion that consumers were retrieving encoded marketing information using positive associations between self and brand. This is highly critical to how marketers are able to persuade consumers to select their products and promote future repurchases. When positive brand attachments occur due to stimuli and communications that are relevant to needs fulfilment, consumers are more willing to pay higher prices for this new favourite brand and even defend the brand against potential derogatory statements in the social networking environment (Muniz and O’Guinn 2001). This is important because in order to build this type of loyalty, a contemporary brand needs to recognise that consumers will only encode portions of marketing communications that are perceived as being linked to personal values, needs and attitudes. All other information will, under constraint theory, be blocked out in an effort to put order to chaos in the encoding process. Marketers understand that values are actually long-standing and enduring beliefs of consumers that strongly impact how memory processes are consciously administered. The perceived value of marketing communications is highly relative to different consumer segments driven by economic factors, psychological factors and even social factors. There is a phenomenon of consumer behaviour known as cognitive dissonance, which is when consumers’ beliefs and values are at odds with existing thoughts about a particular brand. Cognitive dissonance is most commonly found in the stage of post-purchase evaluation (Bose and Sarker 2012). It was established that in the memory encoding process, personal experiences play in an important factor in which type of information is blocked out and not admitted to memory. A consumer may have purchased a product with the idea that the company’s persuasive messages were relevant to lifestyle and could fulfil an important need. However, after experiencing the product and not finding favour with it, encoding includes negative associations and cognitive dissonance has occurred. At this point, when exposed to the brand and future communications from the marketer, it is likely that all information retrieval will be associated with negative beliefs about the product which will, in turn, prohibit a desire to make future purchases of the brand. Though it is difficult for marketers to recover brand favour when this type of product failure has occurred, it does illustrate how brands choose to reposition the product in a new category to differentiate, offer promises for service recovery, or some other dimension that will replace negative encoding with positive encoding so that consumers change their perceptions about the brand and return to a state where they find personal connection between values and lifestyle associated with the brand. Wang, Zhang, Choi and D’Eredita (2002) explain that a consumer’s perceptions of a brand’s advertisements strongly influence their attitudes toward it. Consumer behaviour theory indicates that consumers, in the interpretation process, utilise pre-existing stereotypes and first impressions when making initial judgments about a brand (Schiffman and Kanuk 2010). Advertisers are able to use consistent, integrated communications strategies related to lifestyle and values so that consumers shed some of these biases and make more rational judgments about a product’s viability and relevance to fill their needs. Consumers actively relate new stimuli and marketing information with existing memories already stored in the consciousness which creates bias about a brand. In the brand management process, therefore, marketers often create new product innovations, change the brand name, or otherwise reposition the brand under a new competitive focus. This drives out the tendency of consumers to compare new information with pre-existing, stored information so that the brand is now considered a new stimulus and consumers will not block out important marketing communications as they now have no frame of experience reference by which to judge the brand negatively. Simply altering a brand so that it appears fresh is how companies persuade consumers to buy the product by preventing consumers from relying on past experiences and cognitive biases that would strongly influence opinion of the brand. Conclusion As illustrated, once marketers understand the many different biases that occur in the encoding process, they are better able to create communications that will drive out the phenomenon of consumer tendency to block storage of information that is considered irrelevant or non-self-indulgent. 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