Concepts Underlying Pecreption

Perception is defined as the process by which an individual selects, organises and interprets stimuli into a meaningful and coherent picture of the world. No two individuals are alike. Although two persons may be exposed to the same stimuli, and under the same environmental conditions, how each one of them recognises, selects, organises, and interprets the stimuli will be a highly individualised process. Often the perceptual process is based on each one's own needs, values and expectations. Marketers are interested in knowing how each of these variables will influence the perception process.

We start with discussing the basic concepts underlying the perception process. 

Sensation

Sensation may be described as an immediate direct response of a physical sensory organ. The physical senses are vision, hearing, touch, smell and taste. These physical senses are continuously exposed to internal and external stimuli and human sensation occurs because of them. The sensation may be in the form of reaction of the eye to colour or mouth to t taste and so on. Thus, sensation is related to a very elementary or basic behaviour which is based on physiological functioning. And sensitivity of the person to the stimuli will vary depending on the individual's sensory receptors and the intensity of the stimuli to which he or she is exposed.

Perception is something more than sensation. It co-relates, integrates and comprehends the various sensations and information received from the different organs of the body by means of which a person develops his sensitivity to various things and objects. Perception is determined by both physiological and psychological factors. This is because perception is developed based on previous experience (learning), feeling and motives. Whereas, sensation only activates the sensory organs of the body. Simply stated, activation of the ears to hear what another person is saying is sensation and the inference of what is heard is perception.

An individual's sensitivity will depend on the sensory inputs.

Absolute Threshold

The point at which an individual senses a difference between 'something' and 'nothing' is referred to as the "absolute threshold' for a particular stimulus. For instance, two friends after a long ride on the motor bike are hungry. When these two friends first spot a restaurant, it is said to be their absolute threshold. If both of them spot the restaurant at different times, they are said to have different absolute thresholds.

Under conditions of constant stimulation, i.e., the individual gets continuous exposure to certain objects or events, then inspite of the absolute threshold increasing, due to the 'adoption' process, the stimuli will cease to make a positive impression.

This sensory adoption is a problem, which most of the advertisers try to avoid. If viewers are continuously exposed to the same ad for a long and continuous period, after some time they will no longer see the ad as it is. That is, they will no longer 'See' the ad such as to provide sufficient sensory input. It is due to this sensory adoption problem that many of the television advertisers, change their advertising campaigns after some time. If the advertisement, whether shown on T.V or in print media, loses its initial impact on the consumers mind and will cease to provide sufficient sensory input to be noted, it will be preferable to change the ad campaign. For instance the advertisement showing the evil cackle of the horned spokes Saitan (Devil) of Onida TV had been changed to a more humorous and synthetic announcement by an airhostess and now Onida T.V has after a gap of some time re-introduced the 'devil' in its ad.

With the emergence of new media, advertisers have realized the necessity of developing new advertisements, which will help to strengthen their brand building efforts. 

For example, Magicbricks.com, Dainik Jagran (India's largest selling Hindi Newspaper), SOTC Travels have been buying a lot of advertising space in leading newspapers such as The Times of India to ensure that readers note their ads. Big Bazaar uses the rear side of public transport city buses to advertise their products, ensuring that people on the road will be exposed to the ad. At times, advertisers try to draw attention by decreasing sensory input, such as include a lot of space so as to accentuate the brand name or product illustration. Some times the T.V may use silence (no voice over or audio music) to generate interest among the viewers.

Marketers are seeking innovative ways in an effort to catch the attention of the consumers. Through usage of such non conventional sensory inputs, marketers want to ensure that consumers 

notice their products and induce product trails, brand preference and create a high set of positive perception and experience with it. For instance, Tata-AIG Insurance uses SMS and ring tones (like to Zandu Balm, Maggi etc.,) apart from regular telesales in order to reach out to its audiences faster and at lesser cost. Some marketers use specifically engineered fragrance product offerings. Tide detergent powder advertises about its Rose plus Jasmine fragrance associated with their product. Such attempts are made to determine the target customers absolute threshold and woo them to purchase the particular brand.

Differential Threshold

The minimal difference that can be noticeable between two similar stimuli is known as the differential threshold or the just noticeable difference (j.n.d).

This concept was developed by a German scientist named Ernst Weber in the 19th century. He observed that the just noticeable difference between two stimuli was not an absolute amount but was relative and dependent on the intensity of the first stimuli or stimulus. According to this Weber's law, if the initial stimulus is strong, more or additional intensity will be required for the second stimulus to be perceived as different (Consumer Behavior, L.G. Schiffman, L.L. Kanuk, 6th Edn., Prentice Hall of India, New Delhi, 1997, pp. 148-150). For instance, if the price of a colour T.V increases by Rs. 100/- This increase in price may not be noticed (because the increment was below the just noticeable difference). But if the domestic cooking gas price increases even by Re one, this will easily be noticed by consumers. This is because in case of cooking gas, this price increase is a significant percentage of the basic cost of the cooking gas and thus the consumers attention will be drawn to the price hike.

As per the Weber's law, an additional level of stimulus (equivalent to the just noticeable difference) is required for most of the people to perceive a difference between the resulting stimulus and the initial stimulus. Further, it is also said that Weber's law holds true for all the senses and for almost all intensities also

Weber's law has very good marketing applications. Marketers are using Weber's law to determine the relevant just noticeable difference for various reasons. In case of reduction made in product size, increase in product price or reduced quality, the firm would not want the public to notice the difference or when the firm has updated its existing products, or lowered the price, they would want the consumers to just notice the difference, without being wastefully extravagant. For instance, because of increasing costs, firms have to choose between increasing prices or reduce the quantity offered at the existing price. There are some marketers who have preferred to keep themselves in the consideration set of the consumers mind by making a change in quantity. For instance, Brooke Bond's Red Label Tea which used to be available in the sizes of 250 gms and 500 gms is now available at the retail outlets in the 245 gms, 490 gms quantity size packs. This attempt by Brooke Bond is to make consumers just not notice the difference in the quantity size.

In product categories like soap, toothpastes, tea, fast foods etc, marketers have realised that consumers are in a position to try out and choose a number of brands based on price, symbolic appeal or the 'value for money' proposition offered by the manufacturers. And consumer loyalty in this segment is not very strong because even a small change in price may upset the brand. That is why for such product categories, the firms are announcing various promotional schemes like free toothbrush with Pepsodent toothpaste or one plus one free offer of Close-up Gel. Even in the consumer durables category such as the colour T.V., exchange offers (or exchange value proportion) are being offered in order to motivate consumers to buy. Since the market is filled with brands glutter, marketers are working out planned attempts to gain a share of the consumers' mind.

In a period, when the market is crowded with many (consumer) products (especially in consumer non durables) marketers try to adjust the price of their products so that the consumers may not become aware of the just noticeable difference. For instance when the price of tea goes up, the retailers offering loose tea, will downgrade quality (by making a blend consisting of inferior quality of tea leaves mixed with many other ingredients), while not including the 'just noticeable difference'. Some companies are either decreasing the package but maintaining the earlier pack size and get charging the same price. But such tactics will not reveal the Invisible price rise' to the consumers. For instance, Procter & Gamble reduced the number of sanitary napkins in its 'Whisper Ultra size' pack and Kimberley-Clark have reduced the number of diapers 'Huggies' in their packages.

At times, marketers realising the impact of cumulative advertising built up over the years, for a particular brand, may only go for updating the existing packaging so as to not lose the recognition of the product by the consumers. For instance 'Grasim Gwalior advertising has always been associated with the royal, Nawab of Pataudi. This trend was continued only with the emphasis, shifting to fall below the just noticeable difference with the inclusion of Saif Ali Khan, the son of the Nawab of Pataudi.

Medimix herbal soap has differentiated itself on the herbal plant more than two decades ago when there were only synthetic soaps available in the market. Inspite of many other brands having entered this product category, Medimix continued to communicate the benefit of the 'herbal' proposition through appropriate imagery.

A few decades ago Horlicks was positioned to appeal to convalescing people and other segments of consumers who need nutrition-professionals, dancers and children. The brand has not been able to maintain its consistency with regard to its user imagery but has been able to successfully sustain its 'nutrition' association. This brand has been re-launched a few times over the past few decades with an improved version of its offerings. Horlicks through its advertising imagery has continued to re-inforce its nutritive association by focusing on its 'Junior' variant (aimed at children), introduction of its cold shake (Targeting teenagers) — all in an attempt to match the changing needs of its consumers.

When Whirlpool bought the TVS washing machine, they entered into an agreement, where by they were entitled to use the brand name of TVS washing machine, initially for a short period. This was felt necessary because, Whirlpool realised that during the transition period, they would build up a brand name for 'Whirlpool washing machine and this gradual change in the brand name will fall below the just noticeable difference threshold.

Another popular soap in the sandalwood fragrance category is the Mysore Sandal Soap from Karnataka Soaps Detergents limited (KSDL). Over the years whenever the change in packaging of this soap was made, it was a very small one, so as to call in the just noticeable difference threshold level and also to retain its 'Originality'.

So, marketers are continuously engaged in trying to identity the consumers' differential threshold so as to determine the right amount of improvements to be made in the product which would be readily perceived by the consumers' also.

Subliminal Perceptions

There is a major controversy regarding consumer perception i.e., whether consumers can actually perceive marketing stimuli below their absolute threshold. The process whereby stimuli which are too weak or too brief to be consciously seen or heard, although they may be strong enough be perceived to by one or more recepter cells and thus be below the threshold is known as the subliminal perception. Simply put, Subliminal perception refers to the perception of a stimulus below their absolute threshold. Thus perception below the absolute threshold is referred to as subliminal perception. It is reported that in an experiment conducted by Vicary in 1957 had indicated that exposure may occur without attention or comprehension (Consumer Behavior, L.G. Schiffman, L.L. Kanuk, Prentice Hall, 1997, P. 153). That is, even though consumers may not see the message, they may register it. In Vicary's text, two messages were shown "Eat popcorn" and "Drink Coca cola" in movie theatre for a very short time (much below the absolute threshold) at five-second intervals. Subsequently, the sales of popcorn increased by 58 per cent and coca cola by 18 per cent when compared to the time period when there was no subliminal advertising (Consumer Behavior, D.L. Louden, A.J. Della Bitta, 4th Edn., Tata McGraw-Hill, New Delhi, 2006, pp. 379). Of course, later on there were controversies regarding the influence of subliminal advertising on consumer actions.

Nevertheless, evidence suggests that it will be very difficult to exert influence through subliminal stimuli. Further, due to variations among consumers in terms of their perceptual ability, the difficulty in implementing advertising themes at low threshold level and the lack of evidence to any effect of subliminal advertising on the purchasing behaviour of consumers, it is not often used as an effective marketing tool.

External And Internal Factors

The manner in which either a product or service is perceived will depend upon both internal and external factors. This is to say that both external reality and internal reality are intertwined. As human beings, we carry all of our experiences in our mind and have our own selfish interests, needs, motives and expectations in the way in which we would like 'reality' to exist in the world.

Now-a days, no firm can make a strong claim about having brand loyal customers because researches conducted have revealed that for a number of products where there is strong brand loyalty and where taste would appear to have a strong influence on the buying decisions, there is little sensory difference between products.

This is illustrated in the following case. A blind test was conducted (i.e., a test where the identity of the brand is cancelled) to determine the power of the sensory differences, values between 'Pepsi' and 'Coke' by a panel of consumers. The results of the above test are given here under:

• Prefer pepsi 51 %

• Prefer coke 44%

• Equal/can't say 5%

Then, the two brands were once again given to a matched sample, now with the true identity being revealed to the consumers. The results of this open test were as follows. 

• Prefer pepsi 23%

• Prefer coke 65%

• Equal/can't say 12%

From the above illustration it can be concluded that the value added appeal of a brand lies in terms of that which is aroused in the minds of the consumers when they see a familiar brand name or logo.

So, external factors can be said to be related to the physical character of the stimulus, while internal factors include our motives and expectations. Both the internal and external factors influence the way in which an individual perceives a product or brand.

External Factors Influencing Attention

Physical properties of the stimulus include intensity, size, position, contrast, novelty, repetition and movement.

Intensity and Size 

The brighter the sound (intensity) or more louder the sound, more likely that the person's attention is drawn to it. For instance, advertisers use this characteristic to draw the attention of the readers or viewers. Large sized advertisement in a newspaper or magazine will be noticed and also read more often than a small insertion given although the increase in size may not be linear. Prior to the launch of KINGFISHER AIRLINES, big advertisements were released in all leading newspapers to this effect in order to draw public attention. It is more likely that persons or readers notice an advertisement appearing on other pages of the newspapers than if it were to be given under the classified ads columns.

The various down line activities, organised as a part of the sales promotion campaign by various leading organisations are also used as a stimulant to attract the attention of potential customers. Marketers are using festivals to familiarize customers with their product or brand offerings. (For instance, Chateau Indage has tried to increase the mass popularity of its wine brand Vino by sponsoring festivals such as Ganesh Chathurthi pandals, put up banners and signages in high traffic areas of Mumbai.) World Space are advertising at festivals (it sponsored onam festival) venues via hoardings and occasionally even opting for ground promotions. Loud sound, bright colour and big banner especially when the atmosphere is otherwise serene will draw the attention of potential customers.

Position: 

The position of display of the product or advertisement also is a determining factor of attracting attention. An advertisement placed next to a compatible editorial column of magazines, and newspapers is thought to attract more readership response. The even number pages in the newspaper or magazine is assumed to be likely to attract more readers than the odd number pages. In magazines more readership is obtained when advertisements are put on the cover pages or within the first 10% of the pages.

Similarly, positioning of point-of-purchase, placement of the products (i.e., brands) at prominent places on the shelves at the retail outlet, rotating bill boards, hoardings at certain important points is more easily perceived by consumers and people.

For instance, the advertisements of organisations offering services such as Banks, Hotels, Airlines and Restaurants are prominently placed at airports.

Contrast: 

Human beings have the ability to adapt to sounds, odours, pain, bright lights, neon signs and movements. That is, human beings are able to use sensory organs to adapt themselves to various stimuli. This is where contrast will help in the perception process.

In the context of marketing, media planners also plan their advertisements keeping in mind the impact of contrast on perception. For instance,

• A black and white advertisement with a small spot is likely to attract attention because of the contrast (ICICI Bank uses the principle of contrast for its advertisements in magazines and newspapers).

• Advertisers consider colour advertisements to be more effective than black and white advertisement. (People have got a preference to seeing the 'colour films of the 60's and 70's rather than the black & white films of the pre-colour film's period).

• Some advertisers, alternatively make use of large and small sizes, loud and soft tones or primary and paster shades to attract more attention rather than using only one stimulus. • A quiet commercial after a loud programme can attract attention. Say the advertisement of 'De Beers' diamond after listening to a frantic rock music show shown on the television.

• Showing an object or product out of its normal setting will also attract attention, such as a car travelling across and dunes or along a beach. The print advertisement shows the luxury Scorpio car against the backdrop of a beach.

Novelty

It has been observed by marketers that anything which is different from what are normally expected tend to attract attention like an unusual bottle shape or a perfume strip in a magazine and so on. For instance, Frooti' was the first to introduce the novel idea of soft drink being offered in a tetra pack or when 'Coca Cola and Pepsi' were launched in small 'cans' during the World Cup. Likewise, Baron International was one of the first to start with the novel idea of exchange offers. Videocon, Onida and Philips are some of the brands which have created the perception among consumers that a second T.V means a smaller T.V.

Repetition 

Advertisements are repeated more often to enable consumers for brand recall as well as stimulate them and create a strong desire for interest in the purchase of the product.

In the crowded category of consumer non durables, consumers may not be interested to search for specific information about the product and brand before taking a decision to purchase the product. This is where constant exposure through repetition of the ads, will help in linking the brand wise 'top of the mind' recall. Thus marketers must work towards ensuring that, while there are several brands in the same product category, their brand will convey a different value felt proposition and he or she will be geared up to make purchase choice accordingly. For instance, in the tooth paste category, some of the leading brands such as 'Colgate', 'Close-up',

'Dabur', 'Anchor' and 'Pepsodent, have used repetition through mass media to ensure that the brand's proposition will make a significant impact on the consumer's purchase decision.

Movement 

Advertisers have also started using billboards or hoardings with movement, mobile vans etc., so as to inject a feeling of movement into it. Many marketers are finding out smarter ways to reach out to the consumer by organising some movementful activities like holding free trials, demonstrations, exhibitions, mobile vans etc. Such exercises could also result in creating excitement and reinforce top of mind recall. L.G. Electronics had organised a summer strategy. L.G. hired vans and drove through select cities taking its refrigerators and washing machine to the consumer door-step. Similarly, 'Honda City had also taken its car through the city, answered queries, allowed prospective customers to test ride the car and so on. It is assumed that such activities will not only help in easy recall of the brand but also stimulate the purchase decision and then go a long way in building long term relationship with their customers.

However, it is left to the respective marketer's to make efforts and find out the extent to which such tactics have really helped the brand in attracting customers.

Internal Factors Influencing Attention

Customers, may not receive the messages passively. Marketers are interested in knowing what is the impact of their usage of marketing mix elements on the minds of the consumers. The marketer has to constantly understand "What is going on in the consumers' mind there". Whereas, customers have the tendency to use the messages exhibited by the marketers and make their own meaningful interpretation of it and determine the brand's capability.

Consumer will typically associate his or her idea of the product or service with the brand name. It is not the organisation nor marketer but the brand which becomes the consumers's idea of the product or service. The consumer has got his or her own way of perceiving, interpreting and developing beliefs on the value of the brand. Because it is what customers perceive, interpret and believe the value of the brand to be, which plays a significant role at the market place. That is why organisations are working at developing a 'Brand Personality'. When a brand acquires a personality that is well recognised, even products with very little functional differences are seen as being different. Marketers are using marketing mix to develop differentiation strategy. Either of the marketing mixes can be used as a differentiating factor. A few of the more success examples in the Indian market on the basis of selected Superbrand India 2006-07 are:

• Nirma: Economically priced, one of the largest selling single detergent brands in the world.

• HSBC: Bank to give India its first ATM in 1987

• Faber World Class kitchen appliances: First company to introduce a life time warranty on electric chimneys.

• The Bournvita quiz contest: India's longest running national school quiz.

• Airtel: India's largest mobile service provider and with 18,000 songs, 20 languages, retailing across 1,00,000 outlets, it is the world's largest vendor of music.

• Oriental Insurance Company: An impressive record of 91.13% of settling customers grievances satisfactorily.

• Dainik Jagran (newspaper): Believes in reflecting,' the free voice of the people' - as per the National Readership Survey (NRS) 2005, it is the largest read daily in the world with readership of 21.2 million readers.

Thus marketer's are always involved in a search for a proposition that is unique and also sells. A good advertisement helps in the creation of a "Personality difference". And a brand personality can be linked to positioning also. So marketers are trying to assess the impact of the use of the marketing mix elements on the "inner" minds of the consumers. They are constantly involved in seeking answers to the internal factors which may affect the consumer's perception about the product or service (brands).

The Perceptual Process

Having discussed about the basic concepts and the external and internal factors affecting consumer perception, we will now try to understand the perceptual process. The perceptual process involves three components:

• Perceptual Selection

• Perceptual Organization

• Perceptual Interpretation

1. Perceptual Selection

The first, component of perception, selection, involves consumer being exposed to marketing stimuli and then he has to attend to them.

There is a tendency among people to consciously see and hear or be attentive to only certain aspects of the advertising message which is being communicated.

Perception is a selective process. Usually, people are able to sense and receive only limited information from the environment and hence are characteristically selective. During this process of selection, certain aspects of stimuli are screened out and others admitted. These aspects of the stimuli which are admitted remain and fall within the threshold of the person, while those which are screened out fall out or below the threshold limit.

Consumers will identify and choose marketing stimuli based on their needs and attitudes. A consumer intending to buy a sports bike will be more attentive to motor bikes ad, a style conscious person will be more receptive to ads for fashionable clothes while another consumer who is a habital soft drink lover will be more attentive to advertisements potraying the various soft drink brands. In all the above instances the consumer will process stimuli selectively by picking and choosing them based on his by her psychological set.

For perceptual selection to actually take place, the consumer must first see or hear the stimulus and then respond to it.

There are three processes which define selection:

• exposure

• attention

• selective perception

Exposure and Attention

When a consumer's senses - sight, hearing, smell, taste, touch are activated by a stimulus, exposure is said to have occurred. But their interest and involvement with the stimulus will be reflected at the level of attention they devote to it. Attention is defined as the momentary focusing of a consumer's cognitive capacity on a specific stimulus. For example, when consumers take notice of a TV ad, a new product displayed in the retail outlet or a new vehicle in the company showroom, it is said that attention has taken place.

Selective Attention

People will be selective in their choice of receiving various kinds of information for different products or services based on what interests them rather than the message content and also selection of the media.

So based on their need which is active at that point of time, people will be selective and choose to listen to certain aspects of the advertising message, and decide to see and hear only a part of what is being communicated. For instance, if a person's need (which is active at that point of time) is to purchase a pair of formal footwear, his mind will be ready to receive only those stimuli which will give him some information related to footwear. He will exercise a great deal of selectivity and look out for information messages that will help him to increase his knowledge about the retail outlets selling his type of shoes.

Advertisers try to use structural factors such as size through large ads, strategic placement of the ad in the print media by using eye catching photos or illustrations. For example the sportswear brand Adidas had used suburban underground railway system to tie in with the brand's tagline. "Impossible is Nothing". During a campaign it had used time lapse images along the usually blank walls between underground stations-positioned so that the speed of the train made it seem like the man was running alongside. At the stations, Adidas theme advertising made the connection between the running man and the brand.

Selective Exposure

Through selective exposure people try to avoid coming into contact with or avoid any message that may go against or be contradictory to the strongly held beliefs and attitudes. A person's belief very strongly influences his perception about people or things. Because of this, a fact is conceived not on what it is but on what a person believes it to be. Thus the individual normally puts a censorship on the stimulus (inputs) to avoid disturbance of his existing beliefs and value. This is also known as maintenance of cognitive consistency.

Consumers also look out and seek messages that they feel are pleasant or which are sympathetic to their causes and action. They try to avoid painful or unpleasant messages or are against those which they perceive to be threatening in nature. This is also referred to as a part of the process of cognitive dissonance. If a consumer is dissatisfied or unsure after the purchase of a particular product he or she will try to reduce the dissonance. In the words of Leon Festinger, (L. Festinger, A Theory of Cognitive Dissonance, Harper and Row, New York, 1975) this drive is "to establish internal harmony, consistency or congruity among his opinions, knowledge and values" Such dissatisfied consumers will try to reduce the dissonance by seeking information that will reiterate the high value of the product purchased by them and avoid information which may speak against the (presumed high value) product. For instance, those people who have developed the habit of chewing paan or tobacco will avoid all information (including articles) which may link 'chewing tobacco' to cancer. Consumers will selectively expose themselves to advertisements that will reassure and reinforce them of the wisdom in their purchase decision. are bombarded with a lot of information,

In today's age of e-technology, when consumers it becomes humanly impossible to take in all of it. So, they indulge in selective exposure. In other words:

• People are more likely to get attracted to the stimuli which relates to the current need. 

• It is more likely that people may observe the stimuli that they anticipate.

• People are more likely to notice a large deviation of the stimuli than the usual size of the stimuli (For example, a consumer who is interested in the purchase of a car is more likely to notice an ad offering Rs. 15000/- off the list price of an "A" brand than 'B' offering Rs 1500/- off the list price)

Selective Perception

Consumers will perceive marketing experiences stimuli selectively because each person will be unique in terms of her needs, attitudes experiences and personal characteristics. Selective perception means that different persons may perceive the same product, advertisement package in a different way. For example, one consumer may believe that Tide washing powder washes and makes clothes whiter than the other washing powders. Whereas, there could be another consumer who may not agree with this claim, for she may believe that all the washing powders are the same.

As seen from Figure above, selective perception occurs at every stage in the perceptual process. Selective exposure takes place because each individual's belief will influence what she decides to read or hear. Selective organisation occurs because each person will organize information so that it is consistent to her beliefs. And selective interpretation will take place such that perception will conform to prior beliefs and attitudes.

For example, Oral B toothbrush claims that its toothbrush will indicate when the user has to purchase a new toothbrush. This, the marketer assumed would be consistent to the consumers beliefs that such a toothbrush will be helpful. However, dentists, in general, may not concur with the claim. Such consumers' perception can be influenced by brand name associations arrived at from advertising and social stimuli, where the association tends to conform to the consumer's current knowledge and past experiences.

Such selective perception can affect both high involvement and low involvement purchase decisions. In case of low involvement purchases, consumers will selectively screen out more information so as to avoid informational clutter and cognitive activity. Whereas, in case of high involvement, consumers' will selectively choose information so that :

• It helps them to evaluate brands which meet their needs

• They can select brands which conforms to their belief and predispositions.

Perceptual Vigilance and Perceptual Defense

Since selective perception will help the consumer to receive information having relevance to her needs, this process is also called perceptual vigilance.

During high involvement purchases, consumers, through perceptual vigilance obtain the necessary information which matches their requirement. For low involvement purchases, consumers will screen out and minimize information processing through perceptual vigilance. In such instances, the consumer tends to selectively screen out information.

Perceptual defence refers to the individual being vigilant and screening out all those stimuli or elements which create conflict or may give rise to a threatening situation. Consumers may subconsciously screen out the stimuli which is found to be psychologically threatening, even if the exposure has taken place. They may even perceive other factors to be present, which may not be a part of the stimulus situation.

Perceptual vigilance or defence can also be said in reference to the way in which people maintain their prior beliefs. For instance, going by the saying "The customer is always right", the restaurant manager will deal in a proper manner with the customer who is upset with the customer service, ignoring the fact that it was actually the customer who behaved badly. This example again emphasises that individuals unconsciously may distort information that is not consistent with their needs, beliefs, opinions or attitudes.

Perceptual-Equilibrium and Disequilibrium

Perceptual Equilibrium

The underlying principle influencing selective perception is that consumers seek perceptual equilibrium i.e., consistency between prior beliefs they have about a brand and the information they receive about a brand. There are three theories which are based on the Principle of Selective Perception and Perceptual Equilibrium (Consumer Behavior, Henry Assael, 6th Edn., Thomson Learning, Singapore, 2004, P. 221).

Sherif's Social Judgment theory which says that consumers process information in order to ensure consistency by either rejecting contradictory information or by interpreting acceptable information such that it fits in more closely with their views.

Heider's Balance theory which states that when information received about an object conflicts with consumer's belief, they will try to achieve balance by changing their opinion about the object or the source of information or both. i.e., consumers will try to get a balance in beliefs about the information and the object.

According to the Cognitive Dissonance theory when post purchase conflicts arise, consumers will try to seek balance in the psychological set by seeking supporting information or by distorting contradictory information.

Each of the above theories indicate that consumers are seeking consistency between consumer's perception of marketing stimuli and their belief and attitudes.

Perceptual Disequilibrium

Sometimes consumers would accept discrepant information about a selected product. If they did not, it will mean that every time a consumer was dissatisfied, he or she will try to rationalize the purchase and would never switch brands. There are two theories which predict different outcomes of customer dissatisfaction.

The learning theory suggests that when a brand does not meet expectations, consumers learn from the negative experience and will adjust their belief and attitudes accordingly. The outcome is a reduction in the probability of repurchase. For example, even though a majority of the non paan eating consumers accept the link between eating paan and cancer, only half of the heavy paan eaters could be in a state of perceptual disequilibrium. Many of such paan consumers may accept this dissonant information and try hard to stop eating paan i.e., change their behaviour to conform to the information.

Cognitive dissonance theory suggests that when a brand does not meet expectation, consumers will disbelieve the negative information received. For example, the heavy paan eaters may disbelieve the link between cancer and eating paan and rationalize their paan eating behaviour.

Marketing Strategy and Selective Perception

Marketers can communicate messages which are clear cut or ambiguous. When consumers are engaged in perceptual defence, then ambiguous messages will be more effective because consumers are being given latitude to interpret their messages according to their belief about the brand. For example, advertisers use ambiguity in advertising when the product or service is important to consumers but its benefits are not clear cut. But since consumers are utilizing beliefs which are consistent with their needs, this can be referred to as perceptual defence.

For example Indian Oil's Ad asks

"Correct quality?

Correct quantity?

Special services?

Here's where you should be heading...."

The above questions from the Indian Oil gives consumers enough reasons for using Indian Oil's products and services. This ad enables consumers to selectively perceive a range of application with a minimum of informational content and relate it to the ad.

When consumers are engaged in perceptual vigilance, clear cut messages are likely to be more effective, especially when the information is supportive or contradictory to the consumer's belief. When the product or service benefits are clear cut and it is targeted at a specific target market, marketers use an advertisement where the informational content dominates and ambiguity is at the minimum. For example, in case of industrial advertising, most of the ads are providing direct informational content to match the consumers needs of receiving straight forward information. Here the principle of perceptual vigilance is being used. of

Chunking or grouping of information will help consumers to evaluate various brands products by making use of a variety of attributes.

Perceptual Blocking 

Another aspect of perceptual selectivity is perceptual blocking. When consumers are bombarded with lots of information, there is a general tendency to 'block out' some stimuli from their conscious awareness. It will be noticed that when consumers are exposed to many advertisements together, they will automatically switch off, from their mental set, most of the advertisements. For example, popular T.V. programmes are sponsored by marketers of products with commercial viability. The advertisements of all the sponsored products are shown (at times even repeated many times) in short intervals of time during the time of telecast. But most of these ads are perpetually 'blocked out' by consumers due to over exposure of the same.

Perceptual Organization

People do not experience all the stimuli selected by them as separate and discrete sensations They rather, organise this stimuli into groups and perceive them as a unified whole. This method of perceptual organisation enables individuals to view life in a simplified manner.

The underlying principles helping individuals in perceptual organisation was first developed by the Gestalt psychologists. (Gestalt, when translated from German means total configuration or whole pattern). These principles help in understanding perceptual organisations, which ar primarily related to the physiological events occurring in the nervous system of the individual in direct reaction to stimuli by the physical objects. There are three basic principles used in perceptual organisation - grouping, closure and context.

Grouping In grouping, the perceiver groups the different stimuli based on the principles of similarity, continuity and proximity. This means all those stimuli which are grouped together are likely to be perceived as having the same characteristics. The perception of stimuli as groups of information will facilitate easy memorising and recall by consumers.

Marketers are using this principle to enable consumers to get a unified picture and co-relate desired connection with their products. For instance, one of the commercials for Cadbury used to show an old grandfather blowing bubbles with his little grand children. Cadbury was promoting chocolates by associating with the natural spontaneous behaviour on the part of adults. The ad also conveyed the message "The real taste of life". This grouping will convey to the consumer that chocolates is a universal product to be enjoyed by all, irrespective of age barriers.

Through the ad of Nokia N 91, the advertiser is attempting to associate the brand with music and phone. The ad of The Economic Times (Now in Lucknow) tries to illustrate the concept of similarity through grouping the various editions of The Economic Times by providing different business news relevant to the particular city although it caters to the needs of the business news readers across the country as a whole.

The principle of continuity can be applied to the ad of Microsoft software which says that it can be used by all the company's employees, where the transition is continuous. The software can be utilized by all people and also provides them the software to match their ambition to succeed far and wide equally.

Context 

Figure and Ground 

Consumers tend to perceive an object in the context in which it is shown. While organizing information, people have the tendency to keep certain phenomena in focus and some other phenomena in the background. This is said to be the working of the figure and ground principle. This is a very important principle of context.

According to Gestalt psychologists, when individuals organize stimuli into wholes, they will distinguish stimuli which are prominent (the figure that is generally in the foreground) from the stimuli which is less prominent (those in the ground or background).

Advertisers, usually try to ensure that the product is the figure and the setting is in the background. This can be seen in the ad of Johnnie Walker given below.

Closure

When faced with incomplete information, individuals have the tendency to fill in the gaps themselves so as to gain a more meaningful information. They feel ill at ease when faced with an incomplete picture. They prefer to organise their perceptions so as to form a complete picture. In other words, if people are exposed to incomplete stimuli, they tend to perceive it as complete, by either consciously or subconsciously filling up the missing gaps. This may be done on the basis of his or her (the individual's) past experience, past information or on the basis of hunches. This concept of closure can be seen as the tension experienced by a person when a task is incomplete, and the satisfaction and relief that may be experienced on its completion.

At times, some of the advertisements are given in an incomplete manner, where broken lines are put, which have to be filled in with certain alphabets in order to convey some meaning. People usually fill up these gaps to get the picture or meaning.

Perceptual Interpretation

We have seen that perception is a personal phenomenon. People have the tendency to interpret the meaning of what they have selectively perceived and organised on the basis of their own assumptions about the stimuli. This interpretation of the stimuli will be dependent on what the individual expects to see in the light of his previous experience, intuition, data received, motives and interests at the time of perception.

It is likely that the stimuli are highly ambiguous. Some stimuli may be strong while others may be weak. Moreover, based on the angles at which stimuli are viewed, varying distances and changing levels of illumination, it is likely that there may occur fluctuations in the stimuli. Due to the ambiguity of the stimuli, the individual will prefer to interpret the sensory inputs received by him or her, such as to fulfil their personal needs, interests and so on. Thus, we can say that the perceptual interpretations of the stimuli by individuals are also done in relative terms. So there are chances of misinterpretation. But in order to understand how close a person's interpretation, is to reality, we will have to determine the clarity of the stimuli, the previous experience of the perceiver, the individual's motives (or needs) and interests.

Thus, after consumers have selected and organized stimuli, they interpret them. Consumers are able to interpret marketing information by making use of two principles:

(a) Categorization: This principle is with reference to the tendency of consumers to process and place information into their interpretation of logical categories. For example, "This new ad of mineral water must be probably just like 'Bisleri mineral water””.

(b) Inference This principle refers to consumers reasoning out and developing an association between two stimuli. For example, consumers might associate herbal extracts in body care products with natural ingredients.

Perceptual Distortion

There are certain factors which could influence the individual, leading to perceptual distortion. These are briefly discussed below.

Personality or Physical Appearance

Personality of the perceiver greatly influences the perception process. Researches have shown that people have a tendency to perceive others to be having the same attributes or qualities as themselves. People have the tendency to associate certain persons with others who may have certain attributes, irrespective of whether they consciously recognise the attributes or not.

This is why, advertisers give a lot of importance to the selection of models for advertisements. Potrayal of an attractive model to promote the product or service will have an added touch of persuasiveness. This can automatically induce the consumer to develop a positive attitude and behaviour towards the product. For instance, using celebrity, to endorse a product or brand is more appealing to the consumer's mind.

Example of celebrities endorsing certain brands are:

• Hema Malini - Kent water purifier, Malabar Gold 

• Amitabh Bachchan - Reid & Taylor, Boroplus Antiseptic tube

• Juhi Chawla - Kurkure snacks

• Kajol - Marie gold biscuits, Whirlpool washing machine, Asmi diamonds

• Sania Mirza - Tata Tea Premium

Stereotypes

This term 'Stereotype' is used to describe 'biases' involved in perceiving people. This means that there could be a bias involved when the perceiver sees/perceives the person or individual on the basis of a single class or category to which he or she belongs. Stereotypes also convey another meaning, that is there is a general concurrence on the attributed traits and also the possibility of a discrepancy between attributed traits and actual traits. Accordingly, stereotypes may attribute favourable and unfavourable traits to the person being perceived. For example, statements such as:

"All salespersons are fast talkers and bluff a lot." Stereotypes indicate the expectations from certain specific stimuli and how these (stimuli) will ultimately be perceived.

Halo Effect

The term 'Halo effect' is used to describe a process, in which judges use the general impression (either favourable or unfavourable) to evaluate certain specific traits. Here 'Halo' acts as a barrier or screen to keep the perceiver away from actually seeing the trait he is judging. The broad difference between the halo error and stereotyping error is that - in stereotyping the person is perceived on the basis of a single category, while under the halo effect the person is perceived on the basis of one trait or event.

According to consumer behaviourists, 'halo effect' includes the evaluation of multiple brands (say a product line of a firm) by evaluating just one dimension (either the brand name or celebrity endorsement). Going by this perspective of halo effect, marketers can extend the use of a brand name associated with one line of products to another. The knowledge or familiarity which consumers have with the product or brand is likely to influence their perception of the brand and extensions, if any. For example, Amul with the 'Taste of India' tag line has successfully been extended to its ice creams. Horlicks brand name has been successfully extended to its horlicks biscuits also. The value of the brand as perceived by the consumer will be in terms of assurance of quality, reliability and acceptable price.

Irrelevant Cues

Sometimes, consumers form perceptual judgement based on their giving importance to irrelevant cues. In the case of purchase of automobiles, at times, consumers' purchase decisions are based on the importance given to the look, colour, leather upholstery etc. rather than giving due consideration to the mechanical and technical superiority.

First Impressions

There is a very old saying which goes as "First impressions tend to be lasting ones" However, this wisdom will depend on the context and also on the extent to which the perceiver is aware of the relevance of the stimuli considered by him or her.

Firms have to exercise care, especially when launching new products and trying to create a good first impression on the minds of the consumers. If the product fails to make the desired 'first' impact, a 'second chance' to taste success may not occur. And, any subsequent attempts at communicating the advantages may not be sufficient to delete from the consumer's mind about its (unsuccessful) earlier attempts. For decades, Coca-cola company was known only for its Coca-cola brand. Later on the company tried to introduce other flavours and fruit juices and extend the Coca-cola name but consumers had learnt to perceive and link the brand name to the cola drink only. Finally they decided to advertise and support them separately.

Hasty Conclusions

Often people have the tendency to arrive at conclusions very quickly, before examining all the relevant evidence. This behaviour can be based on the person's attitude, motivation level, interest and past experience also. Consumers at times develop the attitude of drawing conclusions based on limited receipt of information. This factor will also act as a distorting factor and come in the way of his perceptual process. There is one ad which appears on the mass media, showing a spokesperson for 'consumer rights' cautioning consumers against blindly accepting the packaged product received from the shopkeeper. Consumers are advised that rather than jumping to conclusions about the verbal assurance of the contents, it is the consumer's right to ask the retailer to measure and verify the same in their presence.

Inspite of the above mentioned distorting influences, it is reassuring to observe that often an individual's past experience may help in resolving stimulus ambiguity in a more realistic way, right up to the 'interpretation' in the perceptual process. Moreover, it is only under changing stimulus condition situation that the individual's expectations may lead to wrong interpretations.

Perceptual Inference

Consumers draw inferences about brands, outlets, and associations. For instance, consumers may associate a Tanishq watch with quality. This inference could be drawn on the basis of word of mouth communication from peer group, friends or advertisements. We can understand this better by having a look at discussions, on product symbols and semiotics.

Product Symbols: Many of the symbols we see in the ads and packages are socially and culturally derived. For example, Air India's Maharaja symbolizes royal treatment, even the usage of orange, white and green colours on many of the packages can be associated with patriotism.

Symbols can affect the consumption process. For example the advertisement of Bajaj Discover DTS-i can be associated with fantacy (computer graphics showing how the the pipes follow the bike rider) and conveys the bike is fuel efficient. message that

However, advertisers have to remember that consumers will perceive symbols selectively. For example, Blackberry may indicate the iconic status to some while there could be others who may find it too fanciful for usage.

Semiotics: The study which examines the role of signs and symbols in assigning meaning to objects is called semiotics. Semiotics tries to determine the meaning consumer's assign to symbols through three components:

• The object or product (say, Kent Mineral RO)

• The symbol associated with the object (water purifier)

• The interpretant or meaning of the symbol (domestic, pure and healthy water).

For marketing purposes, semioticians view the symbols used in the packaging as a kind of culture or consumption dictionary, where the entries are considered to be products, which are culturally defined (Consumer Behavior, Henry Assael, 6th Ed., Thomson Learning. p. 232). Now, going back to the example of Kent Mineral (RO), Water Purifier, assume that the associations mentioned are what the company wants the consumer to associate with the symbol (water purifier). In reality, if the consumers were to associate with the symbol positively (i.e., as the company hoped to elicit), then it can be said that the consumer's perception matches with that of the company's symbolic representation. Under such circumstances, a positive perceptual inference has taken place suggesting that consumer perception has positively interpreted the said symbol. However, if the meaning many consumers associate with the symbol (Kent Mineral RO water purifier) does not match with what the company had hoped to elicit, the very purpose of using the symbol, by the company, defeated.

Consumer Imagery And Marketing Implications

Consumers have a number of enduring perceptions or images, which are quite relevant to the study of consumer behaviour. Thus, it becomes very difficult to gauge the consumer's mind.

Brand Image and Self Image

An important aspect of self concept is the person's level of aspiration. Generally products, brands, other people, places and possessions have symbolic value and are judged on the basis of how they fit with the personal picture of themselves. The different types of self image are:

• Actual self image - How consumers see themselves.

• Social self image - Consumers' perception of how they are seen by others.

• Ideal self image -  How consumers would like others to see them as.

• Expected self image - Consumers' expectations of how they would like to be seen as, at some specified time in the future.

Researches have revealed that consumer's prefer brands which relate to their self perception and to their subjective images of brands.

Brand image will indicate the overall perception of the brand and is based on how the consumer draws inferences about the brand. Brand image is influenced to a great extent by the company brand name too. Say Tata Steel or Bajaj Tempo travellers have established a certain brand image in the mind of the consumers.

A very important aspect influencing consumer's brand image is product positioning. Marketers try to position their brand such that it can meet the needs of the defined market segment. This is done by developing a product concept which will communicate, by using a suitable media, the desired benefit to the target market. Some of the brands which have succeeded due to the suitable product positioning are:

• ICICI Bank: Provide customers a large variety of products at affordable prices across a wide network of branches.

• NOKIA 1100 India phone: Innovative technology meant for rugged use. 

• SONY Technology innovation and premium quality in the field of high-tech entertainment.

But if the product is not positioned properly it may fail to capture the consumer's mind. For example, Mountain Dew, a lemon drink, with the USP "The Spirit of Adventure - Do the Dew" was launched in India. But this USP failed to position Mountain Dew as an adventure drink in the minds of the consumers. And the company had to think of a repositioning of the product.

Perceptual Mapping and Product Positioning

Perceptual mapping is a technique used by marketers to know consumer's perception of their products or services in relation to competitor's brand on one or more relevant characteristic. This technique will enable them to identify and see gaps in the positioning of all the brands in a particular product or service class category.

This technique had been first introduced by Volney Steffre to marketing, in order to determine the share of consumer choices that a new brand will draw when introduced in the market, and also to ascertain the patterns of substitution and competition that is likely to occur after a new brand is made available in the market. Usually consumer's tend to perceive the brand on many dimensions such as quality, price etc. Perceptual mapping technique is multidimensional in nature, enabling the marketer to measure how may stimuli characteristics can influence product perception. Simply stated, the technique of perceptual mapping will help marketers to make an estimate on how their products or services will appear to the consumers in comparison to competitive brands based on one or more relevant characteristics. Such a technique will also help the marketer to position their brand in the particular product category. For instance, the publisher may find that consumers (or readers) perceive its magazine say 'Business Today' to be similar in its editorial content to its closest competitor say 'Business World'. Here the publisher can try to reposition his magazine by changing the focus of its editorial features. Another example could be related to the brand personality. To enable consumers to perceive the difference in their brand as compared to its competitors in the luggage category, VIP industries positions its 'VIP Sky bags' with the value-for-money proposition.

Especially with many global brands available in the market, marketers need to think and concentrate on brand personality positioning.

The Perception of Quality

Consumers perception of quality is often based on his or her evaluation of a product's attributes. This in turn is determined by certain physical cues such as taste, smell, size and shape. But, in many instances, the consumer is unable to form a judgemental (perception) view, by merely going on the basis of the product's physical characteristics. This is because

• The physical differences that exist between competing brands are not sufficient enough to penetrate across consumer's sensory thresholds.

• The consumer may not be sufficiently experienced to determine which product differentiation is more important.

In the absence of first hand experience with the product, consumers tend to assess the product's quality on the basis of certain clues or indicators. At times, these indicators may be external, extrinsic to the product itself- such as price, brand name, promotion, display, P.O.P. (point of purchase) retail outlet and so on. For instance, many of the disinfectants are purchased on the basis of smell. Incense sticks (Agarbattis) are purchased on the basis of fragrance.

There are also intrinsic factors, related to the actual characteristics of the product itself- size, colour, feel and functional effectiveness. For instance, Laptop attached to LCD projector is preferred because of its functional effectiveness and size. The executive will find it to be very handy because of its size and functional utility.

Generally both intrinsic and extrinsic cues will affect the consumer's perception about the quality of the product and its perceived value.

In case of services, it becomes very difficult for the consumer to evaluate the quality of services. This is because of certain distinctive characteristics associated with services such as intangibility, variability, perishability. Moreover services are also simultaneously produced and consumed. These characteristics are not easily measurable, can vary from day to day, from person (employee performing the service) to another and from profession to profession.

In the absence of a method, whereby the consumers could compare the quality of services, they (the consumers) rely on extrinsic or surrogate cues to evaluate the quality of service provided. For instance, in evaluating a hotel's services, the consumer may look into the quality of furniture, interior decor, the services provided at the front office and reception, the availability of added services such as restaurants, swimming pool, the number of awards (if any) displayed, the cleanliness visible in the surroundings and so on.

This means marketers should aim at standardising and maintaining consistency with the quality of services provided. Consumer's use of surrogate indicators to make product or service choice means that research needs to be undertaken to find out those indicators or attributes which are used by consumers in making purchase decisions for particular products.

Price Perceptions

Consumers perceive value in brands when :

• They are cost driven brands, i.e., the brand costs less as compared to competing brands offering similar benefits.

• The product brands have certain unique benefits which offset their premium prices i.e., they are referred to as value added benefits.

MNC food and beverages major Pepsico, in the initials stages while trying to find a place in the Indian market for its juice brand Tropicana had to struggle. Till late 2005, the brand was seen only occupying the shop shelves, especially because of its premium positioning. Finally, Pepsico had to do a rethink on its positioning. It decided to introduce localized flavours such as 100% sweetened orange, guava, mixed fruit and others.

In the high end tech segment, brands such as IBM, Hewlett Packard and Compaq have been able to quote premium pricing position by offering certain specific features such as: more memory, higher CPU speed, LCD screens, DVD (read & write) etc. Such value added unique benefits offsets its premium price quoting. A very important link between consumer perception and marketing is related to the issue of price. Often, consumer's price perception will affect their perception of brand equity and thereby influence their purchasing behaviour also.

Due to the constant changes and intense competition at the market place, the Indian consumer with the imaginary remote control explores the various brands, evaluates them according to his or her concept of 'Perceived value' before purchasing the product or service. While taking purchase decisions, consumers will be looking at the perceived value aspect, which is a blend of quality and price. Thus, marketers need to understand what consumer's price perception will be based on:

• What their (consumers') expectations are about prices (price expectations). 

• Whether the above expectation will or not be reflected in the actual prices quoted (Actual versus reference prices).

• Whether consumers perceive a price- quality association (price-quality relationship).

Price Expectations

Supposing a consumer is planning to replace an old Philips 21 inch colour T.V set, with a new 29 inch colour T.V. He may expect to pay around Rs. 18,000/- for the new set. This price is the consumer's reference price (also known as a standard price), i.e., the price the consumer expects to pay for a certain item. The reference price can be defined as a reference point based on which consumers compare prices for alternative brands.

Apart from this, generally consumers have an acceptable price range, for a particular product, which shows a willingness to accept a range of prices. Marketers are concerned about the consumer's reference prices and the actual prices of the products or services available at the market place. Usually, there is a lot of difference between the consumers reference prices and the actual prices of items.

Sherif's Social Judgment Theory

Marketers are interested in knowing consumers' reaction to the difference between their reference price and actual prices. Sherif's social judgment theory will help to throw some light on the involvement of the consumers in the decision making process. Sherif had suggested three levels of latitude:

• A latitude of acceptance (the number of positions the individual accepts)

• A latitude of rejection (the number of positions the individual rejects)

• A latitude of no commitment (the positions towards which the individual is neutral)

A highly involved individual will have a definite opinion about an issue and would be willing to accept very few other positions. Such individuals will use more attributes to evaluate fewer brands. They also tend to agree with messages (within their latitude of acceptance) and interpret it more positively than it actually is. Such reactions of highly involved individuals is known as the assimilation effect. Such highly involved individuals with a definite opinion about an issue would not only accept few other positions but also reject a wide number of positions (narrow latitude of acceptance and wide latitude of rejection). The message which the individual disagrees with (within the latitude of rejection) will be considered to be more negative than it actually is. Such a reaction is referred to as the contrast effect.

For example, a young motorbike enthusiast who just bought a helmet and is very satisfied with the motorbike may recall some opinions passed out by a friend as more positive and encouraging than they were (assimilation). But, if very disappointed with the helmet, the motor bike enthusiast may recall the same comment by the friend to be more negative that it actually is (contrast). This shows that the highly involved individual is more likely to perceive messages selectively based on his or her preconceptions and biases.

In case of an uninvolved individual, he is likely to find more positions acceptable (i.e., has a wide latitude of acceptance) or would have no opinion about the issue (i.e., he or she has a wide latitude of non-commitment). Thus, such uninvolved individuals, are less likely to perceive the message selectively, and so an assimilation or contrast effect is less likely to occur.

Application of Sheriff's theory to consumer behaviour is illustrated in the following figure 

As seen in figure above, highly involved customers would be actively processing information though they may find fewer brands acceptable. Whereas, less involved consumers would be engaged in less information processing and would find many brands acceptable too.

Sherif's theory throws more light on the buying behaviour of passive or less involved consumers. Less involved consumers will consider a wider number of brands because of a lack of commitment to one or more brands. Due to their lack of commitment to any brand, they are not interested in spending time to interpret advertising messages or search for and evaluate brands. Such consumers will perceive advertising with little cognitive activity and adopt an easy way for purchasing goods. They will purchase the most familiar brand and also buy the same brand, repetitively.

Involved consumers will seek a more optional solution to their purchase decisions. They will use more attributes to evaluate fewer brands. This aspect has been illustrated in Figure 3.4 which shows that such consumers' latitude of acceptance is narrower and level of information processing greater.

A Comparison between Actual and Reference Prices

Researchers have taken the help of Assimilation Contrast theory (explained above) to understand consumer reaction. Going back to our earlier example, we presume that the consumer's expected price range for 29 inch colour T.V is from Rs. 14,000/- to Rs. 18,000/-, while the actual price may range from Rs. 16,000/- to Rs. 24,000/-. If the difference between actual and reference is within the consumer's acceptable price range, an assimilation effect occurs. Suppose our consumer evaluates three colour T.V. brands and finds that 29 inch TV. sets are priced around Rs. 16000/-, Rs. 18,000/- and Rs. 19,000/-. Since these prices are within the acceptable price range, he is likely to shift his reference price from Rs. 14,000/- towards the actual price of one of the brands (say Rs. 16,000/- after making a comparison of the various brands. This implies that the consumer did not mind changing the reference price closer to actual prices as long as the actual price was acceptable.

A study by Urbany, Beardan and Weilbaker revealed that when consumers found actual prices not in the acceptable price range, a contrast effect is likely to occur. i.e., they will reject brands priced higher than the acceptable price range.

A Price Quality Relationship?

Generally it is found that when consumers do not have sufficient information about product quality, they are likely to use price as an indication of quality. If our consumer does not have sufficient knowledge about T.V. sets and feels that there are significant price quality relationships between the various brands, he is likely to use high price as an indicator of quality.

Price is perceived to be an indicator of quality, if consumers have more confidence in the source of price information i.e., wherever they felt that the source of information was reliable and trustworthy. Thus consumer perception of prices are important for marketers, because it often influences their perception of quality which in turn will influence their purchase behaviour.

For example, in case of high end products such as electronic items, computers, cars etc., where technological along with functional attributes counted, the Indian consumer behaviour, has been showing positive inclination towards top brands from Toyota, Sony, Samsung and L.G. This can be because consumers perceived these foreign brands offer a proven product delivery experience so there is more involvement from them. But in case of low priced products such as hair dye or hair oil, Indian market is dominated by brands such as Godrej hair dye and Parachute hair oil. Consumers feel they are receiving the same value proposition from these brands, so there is less involvement and the consumer may buy the same brand consistently as he is happy with the brand.

Corporate Image: 

A corporate image goes beyond the design of a company's letterhead, In reality, the corporate image will encompass a much deeper and broad view, i.e., it will communicate the way a business enterprise will relate to its whole social and cultural context. 

A corporate image carries an 'added value'. A corporate image goes a long way in its ability to enter into a relationship with its customers. Because consumers enter into a relationship not only with the brands but with the organisation also. Just as brands create an image in the minds of their customers, so do organisations both for its internal customers (employees) and for their external customers. To keep pace with the technology advancements, the firm needs to go for providing various services i.e., a core service such as offering advice, or answering queries about product shipments, supplementary service such as to offer after sales maintenance for a machine and so on invariably involving interaction between customers and the employees. Further, recognising the human element in offering such services and the immense opportunity it provides for fostering customer (external) loyalty, has resulted in many corporate houses calling for broadening the marketing concept by emphasising on the customer contact employees relationship. This aspect is explained in the figure below.

If the employees or internal customers of an organisation are highly motivated and the firm is able to build a chain of loyal and very much involved internal customers and expose them to the external customers, the corporate house can blossom into an enterprise wide with the culture of customerisation. The pay off will be visible in "The values of customer service which will flow all over the Company" and in turn be passed on to the ultimate consumers. This will also enhance the perception or corporate image in the eyes of the consumers. The 'corporate image of some established companies such as Tisco, Tata Motors, Infosys, Wipro Technology is well known. These companies have successfully created a positive image of themselves in the minds of people by adopting various means of customerisation.

Advertising and Perceived Benefit

The principle of competitive persuasion plays a big role in our decision making process. Advertising helps in the creation of images in consumer's minds. People have a lot of belief in the brand image of a product or service.

Advertising helps in converting a product into a brand by adding psychological intangibles and functional tangible value to it. The intangible values will be the self image, life style and benefits. Advertising helps in creating images and uses this image and feelings to create equity for the brand. Advertising helps to make an asset out of a product, with 'cash value'. It is through advertising that brands help in forming the basis of a company's assets and are valued on them.

Jim Young (Jim Young, How to become an Advertising Man', Advertising Publications, Inc. 1963) suggested five ways to make advertising work. These are:

1. By familiarising - bringing the product into common use.

2. By performing the function of 'reminding' the consumers about the product and its utility or usage.

3. By communicating or spreading news in the commercial field. 

4. By overcoming inertia - the drag on human progress explained by the term 'Cultural lag'. 

5. By adding value to the product through creativity.

Thus advertising helps in increasing the perceived benefit of the brand. And this can be done effectively by understanding what advertising is trying to achieve i.e., what is its primary role? 

Sales Promotion and Perceived Value

Promotion activities can be split into price and non price related activities. 

Price related:

• Consumer price promotions

• Trade advertising allowances

• Dealer promotions.

• Free samples or goods

• Trade bonuses and so on

Non price related:

• Merchandising

• In store displays

• Point of Purchase

• Coupons

• Competitions

• Premiums and so on.

As mentioned earlier in the chapter, care should be taken that in case of price reductions, efforts are also made to re-inforce the belief of the positive worthiness of the brand by highlighting its attributes.

Further, continuous, indiscriminate and badly executed price cutting may also result in creating a negative image in the minds of the consumers. For instance, some retailers always have sale promotion programme, offering 20% or 40% discount on their products, throughout the year.

Nevertheless to ignore the role of normal price and the impact of a short term price reduction, would also be foolish or dangerous, especially when very often, for certain products, consumers make purchase decisions at the point of sale. For example, during festival seasons consumers may be in the mood to spend more than what they would do usually. So ideally speaking, firms have to determine beforehand their long term strategic decisions (especially in the event of wanting to beat competition) and on short term tactical pricing decisions to encourage new buyers or persuade lapsed buyers to return to you.

The role of promotion is to encourage purchase by temporarily improving the value of the brand. So value-added promotions must be used to enhance consumer's perception of the brand.

Public Relation and Perceived Value

Every firm strives to have a good relationship within the environment in which it operates. Public relation is a marketing tool used by firms to add value especially to the organisation. Public awareness and relation influence opinion of those who have a stake in the business, such that they are happy to support it.

Personal Selling and Perceived Value

Personal selling through the company's sales force is another effective marketing tool used by the firm to create and keep customers. Few of the specific advantages that can increase the perceived value through personal selling are:

Due to direct communication the salesperson can use this to build a more intimate relationship with the customer.

The sales person can personalise and tailor make the offer. The sales person can help the customers articulate their requirements more clearly and also modify the offer so as to fit the perceived needs of the customers.

Whenever objections are made and if it comes in the way of the perceived value of an offer, the sales person will be able to deal with them at functional as well as emotional levels.

Thus firms should make use of various marketing techniques to add value to a brand and alter or improve its perceived value.

Perceived Risk

Perceived risk can be defined as the uncertainty experienced by consumers due to their inability to foresee the consequences of their purchase decisions.

The above definition talks of two relevant aspects of, perceived risk, namely 'Uncertainty' and Consequences'. Though consumers examine all aspects of a purchase decision i.e., what to buy, how to buy, where to buy and so on, they cannot be absolutely sure about the consequences of their purchase decision. Due to this uncertainty, consumers perceive some degree of 'risk' in their purchase decision.

The major types of 'risk' perceived by consumers when making purchase decisions are: 

• Functional risk: The perception that the product may not function well as expected.

• Financial risk: The risk that the product may not be worth its cost

• Physical risk: The risk related to the physical characteristics or features of the product. 

• Social risk: The risk of the product not being accepted by the society as a good choice. 

• Psychological risk: The risk that the product choice may result in hurting and bringing down the morale and ego of the consumer.

• Time risk: The risk combined with the fear that the time spent in product search  may be in vain if the product does not perform as expected.

The perception of risk varies from person to person, depending on the individual (his or her tolerance limit) the type of product, the shopping method and the culture of the country. The amount of risk perceived can be based on whether the consumer falls under the high risk perceiver category (who will make a product choice from limited choices of products) or under the low risk perceiver category (who will make their choices from a wide range of alternatives).

With product categories also, consumers are likely to perceive a higher degree of risk with the purchase of higher priced products with more functional benefits than with products which do not have many technical features. The type of shopping method used by the consumer also influences his or her notion of "perceived risk", i.e., direct shopping from a retail outlet or by teleshopping, catalogues, personal selling etc. In the absence of direct experience with the product, consumers tend to perceive risk in mail order shopping. But now with many channels, having introduced the consumers to the benefits of tele shopping, there is less perceived risk being associated with such shopping experiences. Each country follows it own unique culture and accordingly its people will also display varying degrees of perceived risk.

Risk Reduction Strategies Adopted by Consumers

Consumers usually develop their own strategies for reducing perceived risk. These strategies could be one of these:

• Consumers Seek Information: Under this, consumers are engaged in a search for more information about the product from various sources of information (world of mouth, family, friends etc). This method is quite straight forward and logical because with more and more information available the consumer becomes more confident about his product category and brand choice thus reducing his perceived risk.

• Continuing with the Same Brand: Consumers try to reduce the perceived risk by avoiding changing the brand and going for new brands. Here, the consumer prefers to be loyal to the brand with which he is familiar rather than going for a change in brand.

• Going by Brand Image: Marketers spend a lot of money in promoting their brands by enhanching on the perceived quality of their products and thereby creating a favourable brand image. When consumers are required to make a choice from a particular product category, they tend to place more trust and favour the product which is a well known brand. For, with a well known brand, consumers are assured of the quality, functional performance etc., which will help to reduce the perceived risk associated with the brand.

• Going by the Store Image: Retail outlets also carry store image. Store image will communicate about the quality of products sold by them, assurance about good after saleg service, privilege to return in case of dissatisfaction and so on. For instance, a customer may decide to make purchases from the Park Avenue' outlet because he is assured of the quality of the products sold there going by the store, image, This in turn will also help in reducing the concept of perceived risk if he were to buy the same from a new retail outlet (say).

• Buy the Most Expensive Product There is a perception among people that high price is an indicator of high quality i.e., consumers tend to equate price and quality. Thus by going for purchasing the most expensive product, consumers will perceive that the risk factor is reduced.

• Seeking Reassurance: Seek assurance by adopting the various schemes offered by companies. These schemes may include money back guarantees, tees, warranties, samples etc.

The concept of perceived risk has many implications especially in case of new products as well as high priced goods. Thus, it is important for marketers to provide consumers with opportunities to reduce the perceived risk associated with the product, and thereby gain their confidence in the brand.