Chapter 7:
Connected Consumers Online
Learning Objectives
Consumers in the Twenty-first Century
Since 1994, the Internet has grown more quickly than any other medium in
history. Nearly 33 percent of the global population had internet access by 2011.
Consumer Behavior Online
Many consumer behavior principles that describe offline buying behavior also
apply to online marketing. At the same time, consumer online buying behavior
has many additional characteristics that differ from offline behavior. Key theories
are based upon the principles of scarcity, popularity, affinity, authority,
consistency, and reciprocity.
Inside the Internet Exchange Process
Exchange is a basic marketing concept that refers to the act of obtaining a desired
object from someone by offering something in return. When consumers purchase
a product, they are exchanging money for desired goods or services.
Technological Context
Two important developments are shaping online consumer behavior today
– home connection speeds and the changing landscape of digital content
receiving devices such as cell phones. Online speeds and the type of
equipment used to access the Internet determine whether a consumer
accesses high or low graphic websites. Streaming music, television, and
Social and Cultural Contexts
The internet enables consumers to help themselves to almost anything they
want when and where they please. Some of the social/cultural trends
Legal Context
In spite of piracy laws, illegally used software abounds. In spite of the
Can-Spam law, the number of unsolicited e-mails has actually increased.
However, the RIAA (Recording Industry Association of America) sued
thousands of illegal music file downloaders and had a significant affect on
online consumer behavior.
Individual Characteristics and Resources
Beyond general social and cultural trends, individuals vary in their online
behavior.
Individual Differences – Internet users differ in their needs and
desires, and differ from nonusers. Online attitude and skills vary in
degree according to whether they are users or nonusers.
Consumer Resources – Consumer value is the benefits minus the
costs (money, time energy and psychic costs).
Monetary – Debit cards, credit cards, electronic checks
(digital money), smart cards, or Paypal.
Time – Consumers want to receive appropriate benefits for
Internet Exchange – The actual moment when exchange occurs.
Browser favorites and social bookmarks assist consumers in
finding specific sites, information, or specials.
Exchange Outcomes – There are six basic things that people do
online – connect, create, enjoy, learn, trade, and give. Each is ripe
with marketing opportunity.
Connect – The Internet allows consumers to interact with
individuals and organizations using multimedia in two-way
communication. E-mail, chat rooms, Internet phone calls
and virtual postcards are the most popular ways for users to
connect.
Chapter Summary
The internet has grown more quickly than any other medium in history. In
2011, 2.3 billion people had access to the internet, representing 32.7 percent of
the global population. Yet 4.7 billion other people are not online, due to social
and cultural, technological, and legal and political issues, as well as the idea that
many activities cannot be replaced by the internet.
Underlying consumer behavior and psychology is similar online as offline
in most cases; however, the online environment drives many new behaviors.
Technology allows marketers to apply traditional theories in interesting ways to
consumers as they use social media and other internet venues.
The basic marketing concept of exchange refers to the act of obtaining a
desired object from someone by offering something in return. Individual
consumers bring their own characteristics and personal resources to the process as
Chapter Outline
Opening Vignette: The Customer’s Story
Have the class read the opening vignette on the one-hour look at young Justin.
Explore the difficulties Justin’s short attentions span can cause in building brand
awareness. Do you have any specific examples of company’s that have done a
good job of marketing themselves online? Companies that have done a poor job
of marketing themselves on line? How might SEO (search engine optimization)
enhance the online marketing?
I. Consumers in the Twenty-first Century
A. Users
2. Has become the fastest growing medium in history
3. 4.7 billion people not online worldwide
4. High cell phone adoption rates may drive more people online
II. Consumer Behavior Online
A. Online consumer behavior models similar to offline models
1. Buying process steps:
a. need identification
3. AIDA model: attention, interest, desire, and action
4. Word of mouth
B. Online consumer behavior models that differ from offline models
1. Scarcity
3. Affinity
5. Consistency
6. Reciprocity
III. Inside the Internet Exchange Process
Exchange is a basic marketing concept that refers to the act of obtaining a
desired object from someone by offering something in return.
A. Technological Context – The Internet has moved from novelty to
utility in the United States.
1. Home Connection Speeds
a. 66% to 77% of Americans connect with broadband
b. Broadband consumers have different behaviors
c. Smartphone customers focus on:
i. Texting
2. Receiving Devices
3. Web 2.0 Technologies
a. Also referred to as social media
B. Social and Cultural Contexts
1. Reputation
a. Based on the market’s perception
2. Relevance
a. Consumers dislike irrelevant communication
3. Engagement
a. Relevant content or entertainment is key
4. Other Key Trends:
a. Information overload
b. Multitasking
C. Legal Context
2. In spite of piracy laws, illegally used software abounds
D. Individual Characteristics and Resources — Some variances are based
on differences in characteristics (demographics and attitudes), and
some are based on the resources consumers bring to the exchange
process
1. Individual Differences – Internet users have several
characteristics that nonusers do not. Similarly, users differ in
their needs and desires
a. Demographics
i. 96% of 18-29 year olds use the Internet
2. Consumer Resources – Value = benefits – costs
a. Monetary cost – discretionary income is needed to
exchange for goods and services, and for a computer,
and ISP and Internet access. However, you can’t
really pay cash online
i. Credit cards (but some people don’t want them
or can’t get them)
ii. Debit cards
E. Internet Exchange
2. Browser favorites and social bookmarks help consumers
quickly jump to their favorite online retailer
F. Exchange Outcomes – People do six basic things online:
1. Connect – The Internet allows consumers to interact with each
other and the organization
2. Create – creation of multimedia to connect with friends, co-
workers and relatives.
3. Enjoy – many people use the Internet for entertainment
a. Audio and visual entertainment
4. Learn – consumers access information to learn:
a. News
5. Trade – transaction-oriented activities
a. 71% of Internet users have purchased products online
b. Users seek information before they buy
6. Give – creation of multimedia content to benefit others