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Unformatted text preview: MKT 613- Consumer Behavior Prof. Carolyn Yoon Session 21 (Apr. 6) Notes Exercises (notes marked in red): Advertising to Children Slide: May use this during the Ethics Class: Youtube video “Mass Media marketing sex and beauty to little girls” Compulsive Buying Slide: Can use for the Ethics Class: show house of a compulsive shopper hoarding and Ask “how would you feel if you had a role in this situation, contributed to this person’s problem? Introduction Companies, services that have a social component to it… if someone on Facebook endorses that, guess what happens? Facebook is low value socially, word of mouth is much stronger. They have actually been able to quantify some of this, so for instance, American Eagle, when they started posting the “like” buttons on Facebook, the… went up by 57% on average. So they are saying “wow, all the businesses should be doing this,” but I think the question should be asked that is not being asked is that if everyone is on Facebook, then whatever advantages… can’t be as high, but you now, Facebook doesn’t take a cut from any of this, I guess they could do that but they think that it is going to lead to more advertising because companies see that they are getting higher sales through Facebook features, so that they are more likely to advertise. It seems pretty intuitive, something that we already knew and sort of talked about, but this is kind of the stage for understanding social media so it is being covered as “wow, this is more effective than generic advertising.” Slide: Paradox of Choice Let’s talk more about today’s stuff, which is getting more into the bulk side of consumer behavior. We can start out with something called the Paradox of Choice. So life is pretty complicated these days, lots of choices, and people can get intimidated by these choices, and it can actually lead to greater unhappiness because people get paralyzed by choices, right? And to the extent that some of you are optimizers as opposed to satisfizers, from an economic standpoint, if you are trying to be a utility maximizer, it is about finding the best choice to purchase. And so Barry… who is a psychology professor at Swarthmore is the one that really has this Christian view forward, and in a way he is attacking economists’ perspectives, and I talked to him about this, and he says that the economic view is kind of like an ocean liner, and by arguing that a large subset of the population, you can try to get people to think about this a little bit more, but I think that most people think that it is good to come up with the best choice possible, and when it comes to something like jeans, what does that mean? I think this is actually an experience that he had at the Gap, which kind of started this research, going in and realizing that instead of the… it’s whatever regular pair of Jeans, Levi’s, it is just like every different cuts, colors, you just end up spending way too much trying to decide because it is too overwhelming. colors, you just end up spending way too much trying to decide because it is too overwhelming....
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