Tag Archives: Consumer Behavior

Why multiplexes should learn from independent theaters

On a sunny Saturday, I watched a classic movie titled To Be or Not to Be at the Stanford Theatre, a historic theater in Palo Alto. This movie experience felt like quiet therapy. I want to keep returning to this theatre for several reasons.

First, the analog ticketing gave me human connection. I received a red paper ticket at the tall glass booth, and another person inside cut it in half and handed it back. This mechanical process made me feel warmly connected.

Second, it was affordable in an expensive area. The ticket was $7, which is cheaper than a typical restaurant tip, and a small popcorn was only $1.50. In a place like Palo Alto where everything feels expensive, this low price made me feel comfortable.

Third, and most important, was the atmosphere. Most of the audience were senior couples, quietly watching the movie. Nobody used smartphones and nobody spoke loudly. I did not interact with them, but I felt comfort simply being near them. This calm environment helped me slow down my thoughts that dynamic AI talks never could. Although we often study seniors, we know little about how we feel when quietly sharing space with seniors. Perhaps, we enjoy being near them, watching them chat softly and walk slowly.

Independent theaters like the Stanford Theatre may represent the future of cinema. Multiplexes continue to be positioned as destinations for young couples, but moviegoers are turning away from them. Instead of focusing on couples looking for extraordinary experience, theaters should become places for individuals seeking quiet and reflection.

**

Reference

Bargh, J. A., Chen, M., & Burrows, L. (1996). Automaticity of social behavior: Direct effects of trait construct and stereotype activation on actionJournal of personality and social psychology71(2), 230.

Previous research has shown that trait concepts and stereotypes become active automatically in the presence of relevant behavior or stereotyped-group features. Through the use of the same priming procedures as in previous impression formation research, Experiment 1 showed that participants whose concept of rudeness was primed interrupted the experimenter more quickly and frequently than did participants primed with polite-related stimuli. In Experiment 2, participants for whom an elderly stereotype was primed walked more slowly down the hallway when leaving the experiment than did control participants, consistent with the content of that stereotype. In Experiment 3, participants for whom the African American stereotype was primed subliminally reacted with more hostility to a vexatious request of the experimenter. Implications of this automatic behavior priming effect for self-fulfilling prophecies are discussed, as is whether social behavior is necessarily mediated by conscious choice processes.

“…We constructed two versions of the scrambled sentence task: one elderly prime version, which contained words related to the elderly stereotype, and another, neutral version. For the elderly prime version, the critical stimuli were worried, Florida, old, lonely, grey, selfishly, careful, sentimental, wise, stubborn, courteous, bingo, withdraw, forgetful, retired, wrinkle, rigid, traditional, bitter, obedient, conservative, knits, dependent, ancient, helpless, gullible, cautious, and alone… In the neutral version, the elderly prime words were replaced with the words unrelated to the elderly stereotype (e.g., thirsty, clean, private).”

“…Participants in the elderly priming condition (M = 8.28 s) had a slower walking speed compared to participants in the neutral priming condition (M= 7.30 s), t(2S) = 2.86,p< .01, as predicted…”

“…Thus, our results are in harmony with those of Carver et al.
(1983), who advanced a “behavioral schema” model as an explanation for modeling effects. According to the behavioral
schema model, the perceptual and actional representations of
the same type of behavior share many features in common and
thus develop strong connections. As a result, if one has just perceived another person acting in a generous or an aggressive way, for example, one’s behavioral schema for generosity or aggression is activated and accessible, and so one is more likely to behave that way oneself in subsequent situations for which generosity or aggression is a relevant response.

How consumers create greenwashing

I was recently invited by Shelley Takahashi, Professor of Industrial Design at California State University Long Beach, to speak to junior students about sustainability.

During this opportunity, I shared my research on green consumption conducted with Bohee Jung (Jung & Joo, 2021). We borrowed the concept of choice–preference inconsistency from consumer behavior research to test whether consumers over-choose green options even when they do not evaluate them highly.

We found that while 76% chose the green option, only 49% actually rated it more favorably. A similar gap can be seen in real-world cases like the hype around Starbucks plastic reusable cups. Although companies are often accused of greenwashing, consumers themselves contribute by over-choosing green products they do not fully use.

Photo courtesy of Nicole Jolliff

***

Reference

Jung, B., & Joo, J. (2021). Blind Obedience to Environmental Friendliness: The Goal Will Set Us Free. Sustainability, 13(21), 12322.

In the past, researchers focusing on environmentally friendly consumption have devoted attention to the intention–action gap, suggesting that consumers have positive attitudes toward an environmentally friendly product even though they are not willing to buy it. In the present study, we borrow insights from the behavioral decision making literature on preference reversal to introduce an opposite phenomenon—that is, consumers buying an environmentally friendly product even though they do not evaluate it highly. We further rely on the research on goals to hypothesize that choice–evaluation discrepancies disappear when consumers pursue an environmentally friendly goal. A two (Mode: Choice vs. Evaluation) by three (Goal: Control vs. Quality vs. Environmentally friendly) between-subjects experimental design was used to test the proposed hypotheses. Our findings obtained from 165 undergraduate students in Korea showed that, first, 76% of the participants chose an environmentally friendly cosmetic product whereas only 49% of the participants ranked it higher than a competing product, and, second, when participants read the sentence “You are now buying one of the two compact foundations in order to minimize the waste of buying new foundations,” the discrepancy disappeared (64% vs. 55%). Our experimental findings advance academic discussions of green consumption and the choice–evaluation discrepancy and have practical implications for eco-friendly marketing.

Displaying lifestyle: Inglenook winery and Tsutaya bookstore

Inglenook winery, owned by filmmaker Francis Ford Coppola, is famous for its fine wines and cinematic heritage. Its castle-like architecture is also impressive. However, beyond these attractions, Inglenook’s wine displays are unique.

Rather than presenting bottles in isolation, Inglenook pairs them with lifestyle products such as artisan candles, gourmet pasta, sketchbooks, and sun hats.

These combinations are not decorative. They suggest how wine is consumed and experienced in real life: during intimate dinners, relaxing moments, creative reflection, or outdoor leisure. The display turns wine into a lifestyle choice.

Likewise, Tsutaya bookstore pairs books with music, stationery, and home goods, helping visitors envision these products as part of their lifestyle.

At both the Napa winery and the Tokyo bookstore, lifestyle-oriented displays enable consumers to see how the products integrate into their daily lives, thereby increasing their perceived value.

***

Reference

Stokburger-Sauer, N. E., & Teichmann, K. (2016). The effect of context attractiveness on product attractiveness and product quality: The moderating role of product familiarity. Marketing Letters, 27(4), 675–686.

Bundling is pervasive in today’s markets. However, the bundling literature contains inconsistencies in the use of terms and ambiguity about basic principles underlying the phenomenon. The literature also lacks an encompassing classification of the various strategies, clear rules to evaluate the legality of each strategy, and a unifying framework to indicate when each is optimal. Based on a review of the marketing, economics, and law literature, this article develops a new synthesis of the field of bundling, which provides three important benefits. First, the article clearly and consistently defines bundling terms and identifies two key dimensions that enable a comprehensive classification of bundling strategies. Second, it formulates clear rules for evaluating the legality of each of these strategies. Third, it proposes a framework of 12 propositions that suggest which bundling strategy is optimal in various contexts. The synthesis provides managers with a framework with which to understand and choose bundling strategies. It also provides researchers with promising avenues for further research.

Red stickers at the gas pump changed how we pay

While filling up my car at a California gas station, I often noticed three red stickers on the pumps. Initially, I thought the pumps were new. However, I soon learned that these red tapes are security stickers designed to prevent card skimming scams.

Card skimming occurs when criminals place fake card readers over the real ones to steal credit card information. If someone tries to tamper with the machine, the seal breaks.

I have been instinctively looking for these red stickers at the gas station. Interestingly, I actually feel relieved when they are not there because it means the machine has not been tampered with.

This simple visual cue further changes how I behave. Now I prefer to tap my credit card instead of inserting it.

Researchers once said consumers might hesitate to use contactless payment because of perceived risks. But at California gas stations, tapping feels safer. Real people do not behave the way academic research expects them to.

***

Reference

Karjaluoto, H., Shaikh, A. A., Leppäniemi, M., & Luomala, R. (2020). Examining consumers’ usage intention of contactless payment systemsInternational Journal of Bank Marketing38(2), 332-351.

Purpose: This study develops and tests a conceptual model that combines the modified Unified Theory of Acceptance and Use of Technology (UTAUT2) with a consumer brand engagement model to predict consumers’ usage intentions toward contactless payment systems in a developed country.

Design/methodology/approach – We cooperated with a contactless payment service provider in Finland and reached out to 22,000 customers, resulting in 1,165 usable responses. The collected data were analyzed using structural equation modeling.

Findings – The study shows that the UTAUT2 and the consumer brand engagement model together explain approximately 70% of the variance in usage intention. Of the predictors, habit and consumers’ overall satisfaction have the strongest influence on usage intentions. The model also confirms the positive relationship between intention and use.

Practical implications – Understanding the reasons for both the intention to use and the continued use of contactless payments is important for merchants, banks, and other service providers. This study shows which technology adoption factors drive both the intention and the use of contactless payments. The finding that intention is mainly driven by habit and overall satisfaction and not by hedonic reasons indicates that such behaviors are difficult to change.

Originality/value – This study is among the first to examine contactless payment usage in a developed market, where over half of all point-of-sale transactions are executed using contactless payment cards and/or cell phones.

How urinal heights in California made me kinder

Men’s restrooms in California are interesting. Among multiple urinals, one is almost always placed significantly lower than the others.

At Stanford University’s Y2E2 building, the engineering department’s restroom features a lowered urinal.

D.School, home to Stanford’s designers and creativity thinkers, also incorporates this principle.

In the Mountain View Public Library, the pattern continues.

Even at the Santa Cruz amusement park, this feature can be observed.

Interestingly, California’s attention to height differences goes beyond urinals.

At the Stanford Redwood City’s gym, drinking fountains are installed at two different heights.

Similarly, two hand dryers vary their heights in the Mountain View Public Library.

The Santa Cruz amusement park includes one sink with a footstep among a row of basins.

These height variations comply with accessibility codes to accommodate a broader range of users, including children and individuals with disabilities. They are specified in the California Building Code (CBC), Chapter 11B.

According to Section 11B-605.2 of the CBC, urinals must be either stall-type or wall-hung, with the rim positioned no higher than 17 inches (432 mm) above the finished floor. Additionally, urinals are required to have a minimum depth of 13½ inches (343 mm), measured from the outer face of the urinal rim to the back of the fixture.

In all the cities I have visited including Toronto, Seoul, and Copenhagen, I have never encountered men’s restrooms with urinals at varying heights. It was only after being exposed to this design in California that I became aware of how some individuals might struggle with standard urinals.

Certainly, ideal height for urinals is arguable. However, regardless of the practical effectiveness of the height variations, California’s effort to accommodating different people is psychologically effective. This enforced inclusivity encourages me to be more considerate of others including children or individuals in wheelchairs. Design can reveal aspects of the world we overlook.

***

Reference

Patrick, V. M., & Hollenbeck, C. R. (2021). Designing for all: Consumer response to inclusive designJournal of consumer psychology31(2), 360-381.

Inclusive design considers the needs and capabilities of the whole population to decrease the actual or perceived mismatch between the user and the design object. We review the inclusive design literature across multiple disciplines to conceptualize inclusive design, identify who should be included in the inclusive design process, present an overview of the evolution of design approaches, and summarize best practices on how organizations can facilitate inclusive design. We posit three levels of inclusive design based on the diminishing degree of mismatch between the user and the design object: providing accessibility (Level 1), engaging participation by creating equitable experiences (Level 2), and facilitating empowered success via flow experiences (Level 3). We introduce our Design, Appraisal, Response, Experience (DARE) framework to explain the complex cognitive appraisals and emotional responses that each of these three levels of inclusive design elicits and underscores the notion that inclusive design works best when it’s not intended for a specific need, but rather benefits anyone who uses it. We conclude with a call for future research in this rich and important domain of investigation that seeks both to understand consumer response to inclusive design and to incorporate inclusive design into brand strategy, practice, and policy.

Why Americans stick to Keurig while the world prefers Nespresso

After arriving in California, I was struck by a coffee pod brand completely unfamiliar to me: Keurig. Despite owning a Nespresso coffee machine at the office and a De Longhi espresso machine at home, I was surprised that I had never seen or heard about Keurig before.

In California, Keurig machines are everywhere. The brand holds 41% of the single-serve coffee machine market in the United States and is estimated to have three times the sales of Nespresso nationwide.

However, Nespresso is the leading coffee capsule brand in most other markets. In Korea, it dominates the coffee machine market with a 52% share.

The biggest advantage of Keurig is that many coffee companies produce pods or capsules compatible with its machines. Brands like Starbucks, Peet’s Coffee, and Dunkin offer options for Keurig users. Additionally, Keurig machines and K-Cups are generally more affordable than Nespresso machines and capsules.

However, Nespresso has gaining market share in the United States. Since introducing the VertuoLine system, which brews full-size coffees in addition to espresso, Nespresso increased its US market share to 14.4% in 2023 up from 11% in 2022. During the same period, Keurig’s share declined from 56.2% to 53.1%. The competition between the two brands is intense and dynamic.

Does this mean cultural differences explain their dominance in different markets? Do Californians value variety and quantity, while Koreans appreciate premium experiences?

Cultural differences are unlikely to be reasons. The real explanation is much simpler: people rarely switch from the brand they first encounter. Californians often start with Keurig because it is the most accessible option, while Koreans are introduced to Nespresso through advertising. Once preferences are formed, they tend to stick.

Each brand’s popularity may not be driven by taste or luxury but by who enters the market first. This is why Uber holds an advantage over Lyft in ride-hailing services and why Waymo continues to thrive while Cruise failed in the self-driving car industry.

***

Reference

Carpenter, G. S., & Nakamoto, K. (1989). Consumer Preference Formation and Pioneering Advantage. Journal of Marketing Research, 26(3), 285-298.

Examined whether pioneering advantage could arise from the process by which consumers learn about brands and form their preferences (PFs). In 2 experiments with 103 MBA students, hypothetical emerging markets were constructed, varying the order of brand (computer software packages or down quilts) entry across Ss and the types of competitors that subsequently entered the market. Analysis showed that PFs were influenced by the order of brand entry. Moreover, the PF formation process produced a PF structure that made a pioneer’s market share largely invulnerable to competitors, even if switching costs were minimal and brands could reposition.

Why do some stores attract me like magnets?

It is hard to find souvenirs in California that are not available in Korea. Because of this, I do not usually feel drawn to specific stores. However, Jupiter & Main at Half Moon Bay caught my attention. This store carefully selects items made from natural materials and hand-crafted designs. The collection includes leather goods and handmade decor.

I could not pass by another store, Makers Market at Santana Row in San Jose. This store also features handcrafted goods made from natural materials. The range includes leather, wood, and textiles, all showcasing expert craftsmanship.

I am attracted to these stores likely because of a psychological association between the material of a product and the perception of its authenticity. For example, when a material like leather is local, I may assume that the finished product is also local. While this perception is not always accurate, it becomes stronger when handmade or hand-crafted elements are involved. This association makes handmade crafts using leather or natural materials particularly appealing as souvenirs. As someone who values authenticity, these products feel local, and stores featuring them create local experience.

***

Reference

Beverland, M. B., & Farrelly, F. J. (2010). The quest for authenticity in consumption: Consumers’ purposive choice of authentic cues to shape experienced outcomesJournal of consumer research36(5), 838-856.

Drawing from image-elicited depth interviews, we investigate whether consumers pursue the consumption of authentic objects with specific personal goals in mind. We find that consumers are motivated to focus on those particular cues in objects that for them convey authenticity (what is genuine, real, and/or true) and that this decision-making process is driven by a desire to draw different identity benefits (control, connection, virtue) from authentic objects. Our interpretive analysis elaborates contributions to theorizing related to consumer agency in seeking authentic consumption experience. We provide cultural explanations for the desire to assert the authentic self in these particular ways.

How my misconception shaped my view of Blue Bottle

At Santana Row in San Jose, the Blue Bottle Coffee store captures attention with its European-inspired design. A shaded patio under a huge tree, cozy seating, and a fountain create the ambiance of a European plaza.

What struck me, however, was my assumption that Blue Bottle was a Japanese brand due to its minimalist design and precise brewing methods. To me, this coffee brand felt synonymous with Balmuda, a Japanese Electronics brand that prioritizes simplicity.

However, the truth surprises me. Blue Bottle is neither Japanese nor European. It was founded in Oakland, California, in 2002. While it embraces Japanese style, the brand’s actual roots are Californian. In 2017, Nestlé acquired a majority stake, expanding its reach to over 100 locations worldwide, including Japan, South Korea, and China.

Despite its true origins, Blue Bottle seems to benefit from the misconception of being Japanese. Although research shows that authenticity of origin enhances value, my observation flips this insight: when a brand’s origin is incorrectly perceived but aligns with its narrative, it can still elevates value. For Blue Bottle, the misperception of Japanese origins strengthens its image of precision and sophistication. Authenticity may not matter as much as perception.

***

Reference

Newman, George E., and Ravi Dhar (2014), “Authenticity Is Contagious: Brand Essence and the Original Source of Production,” Journal of Marketing Research, 51(3), 371–386.

It is well established that differences in manufacturing location can affect consumer preferences through lay inferences about production quality. In this article, the authors take a different approach to this topic by demonstrating how beliefs in contagion (the notion that objects may acquire a special aura or “essence” from their past) influence perceptions of authenticity for everyday consumer products and brands. Specifically, they find that due to a belief in contagion, products from a company’s original manufacturing location are viewed as containing the essence of the brand. In turn, this belief in transferred essence leads consumers to view products from the original factory as more authentic and valuable than identical products made elsewhere.

Why $39 feels worth it for a fake experience in Las Vegas

I recently visited Las Vegas to attend CES 2025. While many exhibitions were exciting, it was a gondola ride at the Venetian Hotel that kept me thinking afterward.

I was surprised to see people willingly pay premium prices for fabricated experiences. The ride costs $39 for a 10-minute journey along an indoor canal under a painted sky. A private gondola for two costs $156! Why would anyone pay so much for something artificial?

The answer probably lies in the power of social status. These fabricated experiences are designed to be visually stunning. They create shareable moments for platforms like Tiktok or Instagram. I saw many visitors took gondola selfies under the “Venetian sky.” Authenticity may matter less than the emotions people gain from the experience.

***

Reference 1

Pine, B. J., & Gilmore, J. H. (1998). Welcome to the experience economy. Harvard Business Review, 76(4), 97-105.

How do economies change? The entire history of economic progress can be recapitulated in the four-stage evolution of the birthday cake. As a vestige of the agrarian economy, mothers made birthday cakes from scratch, mixing farm commodities (flour, sugar, butter, and eggs) that together cost mere dimes. As the goods-based industrial economy advanced, moms paid a dollar or two to Betty Crocker for premixed ingredients. Later, when the service economy took hold, busy parents ordered cakes from the bakery or grocery store, which, at $10 or $15, cost ten times as much as the packaged ingredients. Now, in the time-starved 1990s, parents neither make the birthday cake nor even throw the party. Instead, they spend $100 or more to “outsource” the entire event to Chuck E. Cheese’s, the Discovery Zone, the Mining Company, or some other business that stages a memorable event for the kids—and often throws in the cake for free. Welcome to the emerging experience economy.

**

Reference 2

Choi, B., & Joo, J. (2021). Authentic Information on the Back Label of Wine Bottle. Asia Marketing Journal, 23(3), 13–26.

This paper investigates whether including authentic information on the back labels of wine bottles enhances consumers’ confidence and purchase intentions about wine; it also assesses the moderating role of involvement and knowledge about wine. We conducted two experimental studies. Study 1 generated three findings. First, when the back label had authentic information, subjects showed higher confidence levels. Second, this effect was hold for subjects with low levels of involvement. Finally, we did not observe this effect for subjects with high levels of involvement. Study 2 extended study 1’s findings and identified the moderated mediation effect of confidence. The findings highlight the important impact on wine choice of authentic information. However, the findings also suggest that authentic information may not be sufficient to attract people with high levels of involvement and knowledge. This study’s findings provide wine producers with practical marketing insights.

Stan’s donut shop: Classic recipes, loyal customers

Stan’s Donut Shop in Santa Clara, California, has been making fresh, hand-made donuts since 1959. It is a favorite place for many people who love classic donuts.

During a recent early morning visit, the shop was crowded with customers. Many were talking to their family members over Airpods which donuts to buy.

The menu offers a wide variety of donuts at affordable prices: classic glazed donuts are priced at $1.75, old-fashioned donuts at $1.25, cinnamon rolls at $3.00, and coffee at $1.50, with refills for just 50 cents.

The shop’s nostalgic ambiance, coupled with the sight of donuts being freshly prepared, evokes a sense of nostalgia that resonates with many customers. This connection to the past, along with the affordability of the offerings, exemplifies why nostalgia marketing is effective at In-N-Out in Long Beach and Cafe Strada in UC Berkeley.

***

Reference

Hartmann, B. J., & Brunk, K. H. (2019). Nostalgia marketing and (re-) enchantmentInternational Journal of Research in Marketing36(4), 669-686.

Most marketing and branding activities are essentially concerned with enchantment—the rendering of the ordinary into something special. To create enchantment, companies are increasingly marketing past-themed brands and products. Yet, there is little research about why and how such nostalgia marketing creates enchantment for consumers. Building on different modalities of nostalgia identified in sociological literature (reluctant nostalgia, progressive nostalgia, and playful nostalgia), we analyze the creation of enchantment through a longitudinal, qualitative, multi-method program of inquiry. We find three routes to enchantment grounded in different nostalgia modes: (1) re-instantiation (symbolic retrojection into a past), (2) re-enactment (reflexively informing the present with past-themed brands and practices), and (3) re-appropriation (ludic re-interpretation of the past). By unfolding the different ways in which marketers can press rewind to create enchantment, we discern important implications for theorizing and managing past-themed brands in terms of marketing strategy, targeting and positioning, brand experience design, and marketing communications.

***

Reference

Fuchs, Christoph, Martin Schreier, and Stijn M.J. van Osselaer (2015), “The Handmade Effect: What’s Love Got to Do with It?,” Journal of Marketing, 79 (2), 98–110.

Despite the popularity and high quality of machine-made products, handmade products have not disappeared, even in product categories in which machinal production is common. The authors present the first systematic set of studies exploring whether and how stated production mode (handmade vs. machine-made) affects product attractiveness. Four studies provide evidence for the existence of a positive handmade effect on product attractiveness. This effect is, to an important extent, driven by perceptions that handmade products symbolically “contain love.” The authors validate this love account by controlling for alternative value drivers of handmade production (effort, product quality, uniqueness, authenticity, and pride). The handmade effect is moderated by two factors that affect the value of love. Specifically, consumers indicate stronger purchase intentions for handmade than machine-made products when buying gifts for their loved ones but not for more distant gift recipients, and they pay more for handmade gifts when purchased to convey love than simply to acquire the best-performing product.