In this article we will discuss about Consumer Behaviour: 1. Meaning of Consumer Behaviour 2. Examples of Consumer Buying Behaviour 3. Consumer Buying Process 4. Factors Influencing Consumer Behaviour 5. Models of Consumer Decision Making 6. Buying Motives of Consumers 7. Consumer Buying Behaviour 8. Role of Family in Shaping Consumer Behaviour 9. Reference Groups and Its Types and Other Details. Also learn about: 1. Nature Of Consumer Behaviour 2. Importance Of Consumer Behaviour 3. Consumer Behaviour Models 4. Factors Influencing Consumer Behaviour 5. Characteristics Of Consumer Behaviour 6. Consumer Behaviour In Economics 7.Consumer Behaviour Ppt For Mba
Consumer Behaviour Contents
- Meaning of Consumer Behaviour
- Examples of Consumer Buying Behaviour
- Consumer Buying Process
- Factors Influencing Consumer Behaviour
- Models of Consumer Decision Making
- Buying Motives of Consumers
- Consumer Buying Behaviour
- Role of Family in Shaping Consumer Behaviour
- Reference Groups and Its Types
- Marketing Strategies Adopted during Research and Evaluation Stage of Consumers’ Purchase Decision Process
- Different Products Need Different Kind of Buying Process from a Consumer’s Prospective
- Types of Consumer Problem-Solving Processes
- Importance of Studying Consumer Behaviour
Consumer Behaviour: Notes, Question and Answers, Examples, Process, Factors, Models & Strategies in Marketing
1. Meaning of Consumer Behaviour:
Consumer behaviour is a comparatively new field of study. The concept ‘consumer behaviour’ has been gaining importance since 1960. The evolution of marketing concept from a mere selling concept to consumer-oriented marketing has resulted in consumer behaviour becoming an independent discipline. The growth of consumerism and consumer legislation emphasises the importance that is given to the consumers.
Consumer behaviour is defined as “all psychological, social and physical behaviour of potential customers as they become aware of, evaluate, purchase, consume, and tell others about products and services”. In other words, consumer behaviour includes the acts of individuals directly involved in obtaining and using economic goods.
These acts are the result of a sequence of decisions made by the buyer. These decisions are influenced by various factors. Hence, consumer behaviour is the process by which individuals decide whether, what, when, where, how, and from whom to purchase goods and services.
The above discussion gives the following information about buyer behaviour:
1. Consumer behaviour involves both individual (psychological) processes and group (social) processes.
2. Consumer behaviour is reflected by post-purchase evaluation which indicates satisfaction or non-satisfaction.
3. Consumer behaviour includes communication, purchasing, and consumption behaviour.
4. Consumer behaviour is shaped by social environment.
5. Consumer behaviour includes both consumer and industrial buyer behaviour.
2. Types of Consumer Buying Behaviour
:
Types of consumer buying behaviour are determined by:
(1) Level of involvement in purchase decision. Importance and intensity of interest of consumer in a product in a particular situation.
(2) Buyers level of involvement determines why he/she is motivated to seek information about a certain products and brands but virtually ignores others.
High involvement purchases—Honda Motorbike, highly priced goods, products visible to others, and the higher the risk the higher the involvement.
Types of risk are as follows:
(i) Personal risk;
(ii) Social risk; and
(iii) Economic risk.
The four types of consumer buying behaviour are:
(i) Routine Response/Programmed Behaviour – Buying low involvement frequently purchased low cost items; need very little search and decision effort; purchased almost automatically. Examples include soft drinks, snack foods, milk etc.
(ii) Limited Decision Making – Buying product occasionally. When you need to obtain information about unfamiliar brand in a familiar product category, perhaps. Requires a moderate amount of time for information gathering. Examples include Clothes—know product class but not the brand.
(iii) Extensive Decision Making/Complex – High involvement, unfamiliar, expensive and/or infrequently bought products. High degree of economic/performance/psychological risk. Examples include cars, homes, computers, education.
Spend a lot of time seeking information and deciding. Information from the companies MM; friends and relatives, store personnel etc. Go through all six stages of the buying process.
(iv) Impulse Buying, No Conscious Planning – The purchase of the same product does not always elicit the same Buying Behaviour. Product can shift from one category to the next.
For Example:
Going out for dinner for one person may be extensive decision making (for someone that does not go out often at all), but limited decision making for someone else. The reason for the dinner, whether it is an anniversary celebration, or a meal with a couple of friends will also determine the extent of the decision making.
3. Consumer
Buying Process:
The marketer has to understand as to how the consumer actually makes a purchase decision, who makes the decision and the type of decisions and the steps in the buying process.
The following are the roles played by the people in consumer decision-making process:
(a) Initiator- A person who first suggests the idea of purchasing anything.
(b) Influencer – A person who influences the purchase decision.
(c) Decider- One who takes final purchase decision.
(d) Buyer – One who actually makes purchases.
(e) User – Person who uses the product.
Example:
The idea to buy a new model of television might come from college-going son or daughter. A knowledgeable neighbour or friend might advise on the model of TV the family should buy. The husband might make the final decision and the children will be seeing the television most.
The buying process begins with the discovery and recognition of an unsatisfied need or want. It becomes a drive. Consumer begins a search for information. This search gives rise to various decisions and finally the purchaser evaluates these alternatives and finally the purchase decision is made. Then the buyer evaluates the purchase and decides whether he is satisfied or not.
Buying process begins when a person begins to feel that a certain need or desire has arisen. The need may be activated by internal or external factors. The intensity of the want will indicate the speed with which a person will move to fulfil the want. The buyer will postpone the less important motives. Marketing management should offer appropriate cues to promote the sale of the product.
Aroused needs can be satisfied promptly when the desired product is not only known but also easily available. But when it is not clear what type or brand of the product can offer the best satisfaction, the person will have to search for information. This may relate to the brand, location and the manner of obtaining the product.
Consumers can use many sources, e.g., family, friends, neighbours, opinion leaders, and acquaintances. Marketers also provide relevant information through salesmen, advertisers, dealers, packaging, sales promotion and window-displaying. Mass media like newspapers, radio and television provide information. Marketers are expected to provide reliable, up-to-date and adequate information regarding their products and services. This is the pressing demand of consumerism.
This is the critical stage in the process of buying.
There are several important elements in the process of evaluation:
(a) A product is viewed as a bundle of attributes. These attributes or features are used for evaluating alternative brands. For example, a product like tea has certain common attributes such as taste, flavour, strength, aroma, colour, number of cups per packet, and price.
(b) Information cues or hints about a set of characteristics of the product in brands such as quality, price, distinctiveness availability, etc.
(c) Brand images and brand concepts can help in the evaluation of alternatives.
(d) In order to reduce the number of alternatives, some consumers may consider more critical attributes and mention the level for those attributes.
(e) Occasionally, consumers may use an evaluation process permitting trade-offs among different alternatives.
The purchase decision may be influenced by attitudes of spouse, friends and relatives, cost of the product, benefits of the product, etc. Purchase decision includes decisions with regard to product/brand, dealer, quantity and quality, timing, and payment.
Post-purchase behaviour refers to the behaviour of the customer after the purchase and it depends upon his experience of using the product and level of satisfaction. A satisfied customer may make repeat purchases. If the customer is not satisfied he may not buy the product again and may talk bad about the product to his friends, colleagues and relatives. In the case of consumer durables like air-conditioner, television, water purifier, after-sales service is important to achieve high level of customer satisfaction.
Output is the end-result of the inputs of consumer behaviour. It emerges after these inputs are duly processed by the consumer. Output is composed of purchase and post-purchase behaviour.
Purchase is a consumer commitment for a product. It is the terminal stage in the buying decision process that completes a transaction. It occurs either as a trial and/or adoption. If a consumer is buying something for the first time then from the behaviour viewpoint, it may be regarded as a trial. This trial enables him to accumulate experience about the product purchased.
If this experience is positive in terms of the satisfaction derived, then repeat purchases may offer, otherwise not. For example, when a new brand of bathing soap is introduced in the market, the consumer may buy it for the first time as a trial. However, repeat purchases will occur only when he is satisfied with its performance.
But the possibility of a trial purchase is not available in all cases. In the case of consumer durables such as scooters, refrigerators and the like, a trial is not possible, because once a product is purchased, it has to be adopted and repeatedly used. Adoption means a consumer decision to commit to a full or further use of the product.
The consumer behaviour regarding marketing decisions is influenced by a variety of organisational and environmental factors. The Government is one of the prominent ones among these factors which have considerable bearing on the marketing decision-making. Their role as decision-input is, at times, so powerful that they have an overriding influence on marketing decisions.
Consumers the world over have become more and more aware of their due rights and, consequently have become very demanding and choosy. They have started now to look for the ISI, ISO, AGMARK on the product. These trademarks give the consumers a legal guarantee of the quality of the products bearing them. They also help in protecting the consumers against unfair trade practices.
In order to influence the marketing decisions of companies, the role of Government has assumed one or a combination of the following forms-
One way for the State to influence marketing decisions of companies is to undertake actively undertake certain marketing activities by itself. It entails active participation of the State and its agencies in the country’s marketing operations.
The major forms of State participation may be:
1. The Government becomes a manufacturer or a monopoly buyer and/or seller. In developing countries like India, nationalised companies manufacture steel, cement, fertiliser, coal, etc. so as to augment their supply.
The Government procures and sells agricultural commodities such as food grains, cotton, jute, etc. through the Food Corporation of India, Cotton Corporation of India and Jute Corporation of India. The aim is to stabilise prices and protect consumers by regulating the supply of the products concerned.
2. The Government distributes or directs distribution of certain goods through specified agencies. In India, Government distributes food grains and fertilisers through Government and co-operative institutions and thereby influences the distributive functions of assortment and equalisation.
3. The Government promotes or discourages consumption of certain types of products. For example, the Government of India promotes the sale of family planning devices through its own purchases and mass-communication campaigns.
4. The government provides infrastructural and transportation facilities on preferential basis. For example, the State Warehousing Corporations and Railways extend preferential treatment for dairy products and food items.
Thus, by itself performing marketing functions such as selling, promoting, distributing, storing and transporting, the government exerts a lot of influence on the marketing decisions of companies.
Another option available to the Government is to institutionalise certain types of movements in the country, which exert pressure on the marketing decision-makers. For example, the Government of India has institionalised the movement for product grading and standardisation by establishing the Bureau of Indian Standards. This institution has developed a large number of product standards facilitating product identification, purchasing, selling, and marketing procedures.
4. Factors Influencing Consumer Behaviour
:
Consumer behaviour is affected by a number of factors. They can be classified into cultural, social, personal, and psychological factors.
I. Cultural Factors:
1. Culture:
Cultural factors have a deep influence on buyer behaviour. Culture is the basic determinant of a person’s wants. It refers to a set of learned beliefs, values, attitudes, morals, customs, habits and forms of behaviour that are shared by a society. These are transmitted from generation to generation.
Culture is always alive, moving, and ever-changing. Culture shapes the pattern of consumption and pattern of decision-making. Food habits, religious practices, the way we dress are all influenced by culture.
Examples:
(a) Toothpowder usage is in line with traditional mouth-washing habits. The person applies toothpowder to his index finger and rubs it on the teeth. Hence, the reason for the popularity of the toothpowder.
(b) Many companies have come out with religious calendars with illustrations of their products and such calendars are preserved for a long time.
2. Sub-Culture:
Each culture consists of smaller sub-cultures that provide more specific identification and socialisation for its members.
There are four types of subcultures:
(a) Nationality groups such as Chinese, Irish, Polish, etc.,
(b) Racial groups such as Blacks, Whites, etc.,
(c) Geographical groups such as North Indian, South Indian, etc.,
(d) Religious groups such as Christians, Muslims, Hindus, etc. – While Brahmins prefer to go for higher education and take up employment, Vaishyas are engaged in trading activities. Caste decides a person’s status and power in society. During elections, the candidates depend upon the people belonging to the same caste.
3. Social Classes:
These are divisions in the society which are hierarchically ordered and whose members share similar values, interests, and behaviour. There are three distinct social classes- upper, middle and lower classes. Lower classes show limited sense of choice making. Each class differs in their patronisation, the reading habits, clothing habits, etc. Upper class consumers want products and brands that depict their social status. Middle-class consumers shop carefully, read advertisements and compare prices before they buy.
For Example, a family from a higher class may wish to eat in a five-star hotel. A middle- class family may opt for a cost-effective restaurant.
II. Social Factors:
1. Reference Groups:
Reference groups are the social, economic, or professional groups that have a direct or indirect influence on the person’s attitudes or behaviours. Consumers accept information provided by their peer groups on the quality, performances, style, etc. These groups influence the person’s attitudes; expose them to new behaviours and lifestyles; create pressures on the individual.
A family, a circle of friends, a local club, an athletic team and college living groups are examples of small reference groups. When a member is satisfied with a product, he becomes the salesman of the product. He influences other members of the group. The consumer develops positive opinion towards a product or service based on admiration (Cricket players) and aspiration (Film stars) or empathy. The consumers think that, if he uses it, it must be good, if I use it, I will be like him. Example- Many marketers have used film stars to promote consumer goods.
2. Family:
Family constitutes the most influential group on one’s attitudes. Personal values, attitudes, and buying habits have been shaped by family influences. The members of the family play different role such as influencer, decider, purchaser, and user in the buying process.
A person acquires an orientation towards religion, politics, and economics and a sense of personal ambition, does not interact with the parents, still their influence in the unconscious behaviour can be significant. A person’s behaviour is also influenced by his/her spouse and children.
With a great exposure to more information through various media of communication, teenagers are occupying a major role in decision-making. In Indian urban families, wife is the purchasing agent. In case of expensive products, there is a joint decision-making. For example,
Husband dominance- Life insurance, automobiles, television.
Wife dominance- Washing machines, carpenting, kitchenware
Equal- Housing, vacation, outside entertainment.
Example- Johnson & Johnson products are advertised to mothers and not to small children who actually are the consumers.
The three-generation family (husband, wife, at least one child and at least one grand parent) is very common in rural areas-The head of the family plays a major role in buying decisions. Example- Purchase of Television, Insurance, Ornaments, etc. Even marriages are settled by elders.
3. Roles and Status:
Roles and Status are factors which also influence decision making. Roles are the activities of the person in a group. A woman plays the role of wife, mother and sister in a family. She plays the role of an employee in an organisation. She may also play the role of a secretary of an association.
Each role carries a status. People will choose products that will communicate their status to the society. Example- An executive working in a multinational bank may prefer branded shirts/trousers, expensive watches, perfumes and drive a car to reach office.
III. Personal Factors:
A buyer’s decisions are also influenced by personal characteristics, notably the buyer’s age and life-cycle stage, occupation, economic circumstances, lifestyle, and personality and self- concept.
1. Lifecycle:
People buy different goods and services over their lifetime. The life-cycle of a person begins with child birth, shifts to dependent infancy, adolescence, teenage, adulthood, middle-age, old age and then ends with death. Under each stage people’s buying behaviour is different. Under the first three stages, decisions are not made by the consumer.
They are totally dependent on others. In the next stage, buyers not only make their decisions but also influence others’ buying decisions. In the later stages of life-cycle, they are back to the early stages. Example- With exposure to TV, school-going children have started influencing buying decisions with regard to biscuits, chocolates, soft drinks, toys and marketers are targeting this segment.
2. Occupation:
A person’s behaviour depends upon his occupation. A company’s Managing Director will prefer expensive suits, air travel, separate cottage, etc. A worker would prefer economic dresses, bus travel, etc. The occupation of a person decides his ability to buy. Hence, his need-satisfaction depends on his occupation, which provides him the means.
3. Economic Circumstances:
Occupation gives rise to the economic circumstances. A person may have high desire to buy so many things. All his needs do not become wants. This is the result of his purchasing power. People’s economic circumstances refer to their spendable income, savings, assets, borrowing power and attitude towards spending versus saving.
Example- the Indian middle- class has grown in prosperity and consumption of items such as kitchen appliances, TV, refrigerators, washing machines, ready-made garments, jewellery is growing.
4. Lifestyle:
Lifestyle may be defined as the pattern or way of living of a person which will be indicated through the person’s activities, interests, and opinions. A person may reside in an HIC flat. He may have costly furniture. He shall buy his clothing’s only from Raymond’s. He may have his dinner only in five-star hotels. His hobby may be playing billiards. With the above activities, we can understand the lifestyle of a person. Hence, he will choose according to his lifestyle.
5. Personality:
Personality is defined as the person’s distinguishing psychological characteristics that lead to relatively consistent and enduring responses to his or her environment. Personality is described in terms of such traits as self-confidence, dominance, autonomy, deference, sociability, defensiveness and adaptability. A person to maintain his personality will decide his purchase accordingly. He buys products and services that reflect his image.
Example- Rural youth may buy tea and namkeen and urban youth buy popcorn and soft drinks.
Personality is a complex psychological concept. Its primary features are self-concept, roles and levels of consciousness. The self-concept refers to how a person sees himself and how he believes others to see him at a particular time. Self-concept has three parts- (1) the idealised self — what you would like to be? (2) The looking glass self — how you think others see you? and (3) Self-self — your own concept of what you are like.
Each individual plays many roles — loving father or mother, affectionate wife, friendly co-worker, efficient executive, wise home-manager, and so on. The buying behaviour is influenced by the particular role upon which a buyer is concentrating at a given time. Personality traits such as dominance, adventuresomeness, sociability, friendliness, responsibility, aggressiveness, dependence, etc., can indicate how people behave.
1. Motivation:
Motivation is the driving force which makes the person act. Motivation is the drive to act, to move, to obtain a goal or an objective. A human being is motivated by needs. When these needs are backed by purchasing power it becomes a want. Buyer behaviour, hence, is stimulated by motivation.
2. Perception:
A motivated person is ready to act. How the motivated person actually acts is influenced by his or her perception of the situation. To perceive is to see, to hear, to touch, to smell, and to sense something an event or relation and to organise, interpret and find meaning in the experience.
Our senses perceive the colour, shape, sound, smell, taste, etc., of this stimulus. Our behaviour is governed by these physical perceptions. Perception has been obtained by social psychologists as the ‘complex process’ by which people select, organise and interpret sensory stimulation into a meaningful and coherent picture of the world.
People can emerge with different perceptions of the same object because of three perceptual processes- Selective attention, selective distortion, and selective retention.
All persons are not alike. They see the world in their own special ways. For instance, all the members of the family have viewed a particular product advertisement in the television. The members may interpret the same in different ways. Example- Even to-day many consumers prefer to deal with Nationalised Banks/LIC as they feel that private companies may not reliable in the long run.
(3) Learning:
Learning describes changes in an individual’s behaviour arising from experience. Learning refers to changes in behaviour brought about by practice or experience. Almost everything one does or thinks is learned. Learning is the process of acquiring knowledge about products, their benefits and methods of usage and also disposal of product after use. Example- Product demonstration is a very effective method to convince the consumer. Products like paints, pressure cookers, fertilisers are promoted through demonstration.
(4) Belief:
A belief is a descriptive thought that a person holds about something. These beliefs may be based on knowledge, opinion, or faith. They may or may not carry emotional change. An attitude describes a person’s enduring favourable or unfavourable cognitive evaluations, emotional feelings, and action tendencies towards some object or idea.
In simple words, attitude is an emotionalised pre-disposition or inclination to respond positively or negatively in a consistent way towards similar objects. For example, once a consumer has developed a brand loyalty, it is hard to change his attitudes and beliefs towards the brand.
Attitudes are the result of experiences. Attitudes interact with perception, thinking, feeling, and reasoning. Example- Many health conscious people believe that Cola drinks are harmful and they prefer lassi, lime juice, cocoanut water or even mineral water.
Thus, we find that there are many forces acting on consumer behaviour. A person’s purchase choice is the result of the complex forces of cultural, social, personal, and psychological factors.
5. Models of Consumer Decision Making:
Consumer behaviour is an orderly process whereby the consumer interacts with his environment for making a purchase decision on products or services. Consumer behaviour has two aspects. The final purchase activity which is visible to us and the decision process which involves a number of complex variables and not visible to us.
The study involves what consumers’ buy, why they buy it, when they buy it, where they buy it, how frequently they buy it and how they dispose of it after use. Example- A study of consumer behaviour will reveal what kind of consumers buy computers, would they buy for home and personal use or for office, what features they look for, what benefit do they seek including post-purchase service, how much they are willing to pay, how many they are likely to buy, are they waiting for the prices to come down, do they look for some free goods offer, etc.
The objective of the study of consumer buying process is to know how a consumer makes his decision regarding buying or not buying a product or service. In most cases, a decision involves the selection of an option from two or more attractive choices. When a product is expensive (buying a car or apartment) it involves detailed thinking and analysis and high level of involvement on the part of the purchaser, compared to buying soap, vegetables, or groceries.
Basic model of consumer decision-making is composed of three stages, i.e., Input, Process and Output as shown below:
INPUT > PROCESS > OUTPUT
1. Input:
Input is stimulus variable and it includes marketing efforts of the organisation and socio-cultural environment. The efforts include 4 Ps of marketing, i.e., product, price, and promotion and distribution network. For example, when a company introduces a new model of mobile phone, it may run a series of TV commercials and press advertisements.
These activities are designed to reach, inform and persuade consumers to buy and use the product. The inputs are basically marketing-mix components that consist of the product, packaging, branding, and advertisement, personal selling, pricing of the product, distribution channel to move the product from the place of production to place of consumption, i.e., the consumer.
The socio-cultural environment serves as a non-commercial source of information. It includes reference groups (friends, colleagues in the office, members of local club, etc.), members of the family, social classes and cultural factors. These factors have tremendous influence on consumer.
The comments from a friend/colleague, opinion of experienced consumer, social status of a person, beliefs, values and customs, etc., are important input factors that influence how consumer evaluates and buy or reject a product. In the case of mobile phone, the consumer may go by the comments received from a colleague or friend regarding the performance of the particular model of mobile phone.
2. Process:
Process component of the model deals with how consumer makes purchase decision. Psychological factors like motivation, perception, attitude, belief, etc., affect the consumers’ decision-making process. The consumer receives the inputs (marketing efforts and socio- cultural factors) and processes the inputs through psychological process of information processing.
It includes problem recognition, information search, evaluation of alternatives and benefits that lead to a buying decision. The decision process which involves a number of complex variables is not visible to us.
3. Output:
Output part consists of purchase behaviour and post-purchase behaviour. There are three types of purchases, i.e., trial purchases, repeat purchases and long-term purchases. Initially, the consumer may buy small quantities of the product (trial purchase) and if he is fully satisfied with the product, he may make repeat purchases (brand loyalty).
During post- purchase evaluation, the consumer evaluates the performance of the product against his own expectations. There can be three outcomes of these evaluations, i.e., Actual performance meets his expectations (satisfaction), performance exceeds his expectations (customer delight) or performance is below expectations (dissatisfaction).
Rational Economic Model of Consumer Behaviour:
According to the rational economic model of buying behaviour, the buyer is a rational person and his buying decisions are totally governed by the concept of utility. If he has certain amount of purchasing power, a set of needs to be met and a set of products to choose from, he will allocate the amount over the set of products in a very rational manner with a very clear intention of maximising the utility of the benefits he is going to derive.
This purchasing power or economic model of consumer behaviour is certainly uni-dimensional.
It leads us to the four important predictions about the buyer behaviour:
(1) Lower the price of the product, the bigger the quantity that will be bought, which is generally called ‘price effect’.
(2) Higher the purchasing power, the higher the quantity that will be bought, which is known as ‘income effect’.
(3) Lower the price of a substitute product, the lower quantity will be bought of the original product, which is known as “substitute effect”.
(4) Higher the provisional expenditure, higher the sales, which is most commonly known as “communication effect”.
Though these predictions are highly acceptable, the assumption of rationality in behaviour is challenged by behavioural scientists as the Economic Model fails to give satisfactory explanation of how consumers behave. The model tries to explain as to how a consumer ought to behave rather than how he behaves.
That is why it cannot be applied to real life situation as one cannot measure utility in precise terms. The model centres around the “product” and “income” of the “consumer” and closely related psychological and sociological factors have been ignored.
Stimulus-Response Model of Consumer Behaviour:
A very simple psychological model of human behaviour is that stimulus leads to response (S-R). A consumer may get stimulus from environment and marketers.
The marketing stimuli are planned and processed by the marketer whereas environmental stimuli come from economic, social, political and cultural environment. The buyer’s behaviour is shaped by his attitudes and beliefs, motivation, perception, personality, etc. The buyer’s response can be observed in terms of choice of product, brand, dealer, purchase timing and purchase amount.
6. Buying Motives of Consumers
:
A buying motive induces a buyer to buy a product. It is an influence which provides an impulse to buy. There is a buying motive behind every purchase. It may not be the same with every buyer. One buyer may purchase a product to satisfy his one need and another may purchase the same to satisfy an altogether different need.
Therefore, it is necessary for the marketer to identify the buying motives of different kinds of customers. For this he must study the psychology of the customer and design his marketing-mix accordingly. Maslows’ need hierarchy theory which explains buyer’s motives.
There are three considerations which make a person purchase a product:
(i) He has a desire which is to be satisfied;
(ii) He has an urge which induces him to purchase; and
(iii) He has a reasoning.
Broadly speaking, individuals are motivated to buy by internal and external forces as discussed below:
1. Internal Motives:
They often originate in the minds of the people and are both physical and psychological in nature. They are broadly classified into two classes – rational, which is based on logical reasoning or thinking and emotional, which is based on personal feelings.
2. External Motives:
They originate because of interaction with the external environment. Since a consumer is the product of his environment, his buying motives are influenced by the external factors. Various factors like income, occupation, religion, culture, family and social environment act as motivators.
Buying motives may also be classified on the basis of product and patronage as discussed below:
1. Product Motives:
These explain why people buy certain products. Product motives result directly from the needs of customers.
Product motives may be of two kinds:
(a) Primary Buying Motives:
These relate to the reasons why consumers buy one class of goods rather than another. Such motives result directly from the needs and wants, and include the desire to achieve recognition, physical well-being, preservation of self-image, relaxation, beauty, knowledge, money gain, etc. The seller must discover the customer’s primary motives (for they are often unaware of such motives) and then direct his appeal as effectively as possible.
(b) Selective Buying Motives:
These relate to causes that induce a consumer to purchase certain class of quality goods. Selection is based on such motives as the desire for both economy and convenience. Some of the most common selective buying motives include desire for convenience, versatility, economy, dependability and durability.
2. Patronage Motives:
These cause a customer to buy products from a particular seller. Important patronage motives are those concerned with fashion, exclusiveness, dependable after-sales service, convenience of location, quality, price, reliability of the seller, punctuality in delivery, variety of selection, etc.
Rational and Emotional Motives:
When a person decides to buy a particular product or patronise a particular retailer, he may be guided by rational or emotional motives as discussed below:
1. Rational Motives (Economic Considerations):
These motives are based on a man’s reasoning, logic and ability and consideration of economic consequences. They include the immediate monetary cost, and long-range cost affecting the buyer such as economy, durability, depreciation, efficiency, degree of labour needed, dependability and ultimate benefits achieved.
2. Emotional Motives (Psychological Considerations):
These motives are based on personal feelings and cover a wide range of motives including impulses, instincts, habits and drives, etc. These motives include pleasure, comfort, status, pride, ambition, economic emulation, social achievement, selection of gifts, maintaining and preserving health, satisfaction of appetite, proficiency, romantic instinct, social acceptance, recreation and relaxation, etc.
Emotional motives are found more among people of high income groups. TV, Air Conditioner, Refrigerator, Washing Machine, Geyser, Car, etc. are generally bought to satisfy emotional motives.
7. Consumer Buying Behaviour
:
Consumer buying behaviour is a decision-making process and the act of people involved in buying and using various products. Consumer buying behaviour refers to the buying behaviour of the ultimate consumer.
There are various steps which are involved in this process viz.:
i. Problem recognition,
ii. Information research,
iii. Evaluation of alternatives,
iv. Purchase decision, and
v. Post-purchase behaviour.
A marketer needs to analyse all the steps which are involved in this process.
We need to discuss the post-purchase behaviour stage.
Post-Purchase Behaviour:
After the purchase, the consumer might feel dissonance if he hears some unfavourable comments about the purchased brand and favourable comments about the other brand. Thus a marketer must continuously reinforce the consumer’s choice and help him feel good about the brand.
If the consumer is not satisfied with the product then he is said to be disappointed. If his expectations are met by the product, he is said to be satisfied and if satisfaction exceeds expectations, the consumer is said to be delighted. The larger the gap between expectations and performance, the greater is the dissatisfaction.
If the customer is satisfied, he/she is more likely to purchase the product again. The satisfied customer will also tend to say good things about the brand to others and spread a positive word about it.
On the other hand, a dissatisfied customer may abandon or return the product and may take action against the company. Thus post-purchase behaviour analysis is very useful for a marketer.
Actions which can be taken by a marketer by analysing post-purchase behaviour of a customer:
i. Consumption rate should be analysed, since, it will help in sales forecast.
ii. Provide channels for speedy redressal of customer grievances.
iii. Sending a letter to the product/service owner by congratulating him to choose the best product/service, thus reducing the dissonance.
iv. Keeping a track of customer satisfaction and asking for the problems by having a proactive approach, e.g., Mobile service providers like Airtel, Idea etc., call their customers for feedback and ask about the service level.
Study of Post-Purchase Behaviour of Consumers:
Marketers should study the consumer’s post purchase behaviour in order to know the satisfaction level of consumers with respect to the product.
If the expectations of a consumer are not met from the product then he is said to be disappointed, if his expectations are met from the product, then he is said to be satisfied and if satisfaction exceeds expectations from the product, then he is said to be delighted. Thus, marketers need to know the category of the customers’ satisfaction.
In order to know the post-purchase behaviour, the following questions need to be answered:
i. Are the marketing campaigns overstating the benefits of product?
ii. Are there any other benefits that the consumer is seeking from the product?
iii. Why are the consumers dissatisfied? etc.
iv. Also, if the consumers want to be pacified in terms of money refund/ repairs or reimbursement, if necessary.
This can be done by using feedback forms, interviews, and questionnaire schedules or by observation methods so that post purchase behaviour can be analysed.
8. Role of Family in Shaping Consumer Behaviour
:
Family is the most influential factor for an individual. It forms an environment of socialisation in which an individual will evolve, shape his personality, acquires values and also develops attitude and opinion on various aspects.
Hence family members such as parents, siblings, spouse, grandparents, relatives (cousins, aunts, uncles etc.) play a key role in shaping consumer behaviour in the following ways:
(i) An individual usually discusses with his/her family members before purchasing a particular product or service. Family may support an individual’s decision to buy a particular product or stop him from buying it or even may suggest few other options.
(ii) The lifestyle followed by the family influences consumer’s buying behaviour to a great extent.
(iii) Other aspects associated with family in the context of consumer behaviour are economic well-being and emotional support. In countries like India, family members play a crucial role in shaping consumer behaviour.
(iv) In India, children usually stay with their parents specially till the time they get married. Hence whatever he or she sees from his childhood becomes his/her habit or lifestyle. For example, a lady belonging to an orthodox background would prefer salwar suits, sarees instead of western outfits.
Hence family shapes the buying behaviour of an individual as it influences his/her lifestyle, values, attitude, perception etc.
9. Reference Groups
and Its Types:
Reference groups are groups that consumers compare themselves to or associate with. They exercise a great deal of influence in consumer purchasing.
A reference group is the group whose perspective an individual takes on in forming values, beliefs, attitudes, opinions and overt behaviours. One considers this group as a ‘point of reference’, while evaluating their own existence in the world.
In simple words, reference groups are groups that consumers will look to for help in making buying decisions. These are considered as a social influence in consumer purchasing. A reference group includes individuals or groups that influence the opinions, beliefs, attitudes and behaviours of the consumers.
Marketers view reference groups as important because they greatly influence how consumers interpret information and make buying decisions. Reference groups influence what types of products consumers will purchase and which brand of product they will choose.
According to Philip Kotler – ‘A person’s buying behaviour is strongly influenced by many groups.’ A person’s reference groups are those groups that have a direct or indirect influence on the person’s attitude and behaviour.
Reference groups influence the consumers in three different ways:
i. They expose an individual to new behaviour and life-style.
ii. They influence attitude and self-concept.
iii. They create pressure for conformity that may influence product or brand choice.
Types of Reference Groups:
i. Membership Groups – Groups having direct influence on the purchase decision of a consumer.
ii. Primary Groups – With whom the person interacts fairly continuously and informally such as family, friends, neighbours and co-workers.
iii. Secondary Groups – With whom a person tends to be more formal and requires less continuous interaction like religious groups, professional and trade union groups.
iv. Aspirational Groups – Aspirational Groups are those that a person hopes to join, for example, groups of people owing a Ferrari.
v. Dissociative Groups – These are those whose values or behaviour an individual rejects and he will buy the products to avoid being associated with that group.
Although marketers must focus on all types of reference groups, but targeting the opinion leaders is important. Opinion leader is a person who offers informal advice or information about a specific product or product category, such as which product among several brands is the best. Opinion leaders are highly confident and socially active. They have very high influence on purchase decisions.
10. Marketing Strategies Adopted during Research and Evaluation Stage of Consumers’ Purchase Decision Process:
Marketer should adopt the following strategies so that consumer should acknowledge their product at the time of information research and evaluation stage:
(i) Promote and advertise the product aggressively.
(ii) Have a prompt sales force, which can attract the consumers towards the product.
(iii) State the benefits of the products in terms of solution to the consumers’ problems.
(iv) Specify the USP of the product.
(v) The distribution network of the product should be within the reach of the consumers.
(vi) Even if, the consumers are not interested in buying the product, still the sales force should have a feedback form specifying their reactions about the product.
(vii) Reinforcing the benefits of product is very important. Sales force/advertisement must try to re-state the benefits again and again.
(viii) The modes of advertisement should be within reach of the prospective consumers.
11. Different Products Need Different Kind of Buying Process from a Consumer’s Prospective:
1. Complex Buying Behaviour:
i. Consumers herein are highly involved in a purchase and are aware of significant differences among the brands.
ii. Usually a case when the product is expensive, bought infrequently, risky and highly self-expressive like an automobile.
2. Dissonance Reducing Buying Behaviour:
i. Consumer is sometimes engaged in highly involved purchase, but sees less difference in brands.
ii. High involvement is based on the fact that the purchase is expensive, infrequent and risky.
iii. In this case the buyer will shop around to learn what is available. If he finds quality difference in brands, he might go for the one with the higher price. If he finds little difference, he will simply buy on price or convenience. For example- Buying carpets.
3. Variety Seeking Buying Behaviour:
i. Some buying situations are characterized by low involvement but significantly high brand differences.
ii. Here consumers often do brand switching for the sake of variety, for example – biscuits.
4. Habitual Buying Behaviour:
i. Many products are bought under conditions of low involvement and absence of significant brand difference, for example, salt.
ii. Herein, the consumers have low involvement with most of the low cost, frequently purchased products.
12. Types of Consumer Problem-Solving Processes
:
The consumer problem-solving processes involve the following steps:
(1) Routinized Problem Solving:
(i) Used when buying frequently purchased, low cost items;
(ii) Used when little search/decision effort is needed; and
(iii) For example – buying a quart of orange juice once per week.
(2) Limited Problem Solving:
(i) Used when products are occasionally purchased; and
(ii) Used when information is needed about an unfamiliar product in a familiar product category.
(3) Extended Problem Solving:
Used when product is unfamiliar, expensive, or infrequently purchased; for example – buying a new car once every five years.
13. Importance of Studying Consumer Behaviour
:
A number of reasons make the study of consumer behaviour relevant for effective marketing management.
These are as follows:
1. Consumer do not always act or react as the theory would suggest. For example, consumer of the past reacted to price levels as if price and quality had positive relation. Today, consumer seeks value for money, less price but with superior features. This led Videocon to go for Bazooka which was positioned above the economy class but below premium class. The consumer response indicates that the shift has occurred.
2. Consumer preferences are changing and becoming highly diversified. The shift has occurred with availability of more choice compared to pre 1991 era. For example, the customer has many brands of computers to choose from, e.g., HP, Apple, Compaq, IBM, etc.
3. Consumer research has vividly pointed out that consumers dislike using identical products and prefer differentiated products to reflect their special needs, personalities, and life-styles. Thus, when Onida 21 was introduced, it was advertised on the television for the elite class. Maggie introduced Sour and Chili sauce with emphasis ‘its’ different’.
4. Meeting of special needs of customers requires market segmentation. The LIC provides its insurance cover to suit the needs of different types of customers— Jeevan Suraksha (Financial security and post-retirement benefits), Asha Deep II (Medical covers), Jeevan Shree (to retain key individuals in organisations), Jeevan Surabhi (money back with rising insurance cover), Jeevan Mitra (double benefit endowment plan), Money Back (for periodic cash flows), and Bima Kiran (for low-cost, high insurance cover).
5. Rapid introduction of new products with technological advancement has made the job of studying consumer behaviour more imperative. For example, the information technology is changing very fast as far as personal computer industry is concerned. The PC-486 has been declared as dead and even PC-Pentium has got many upgradations.
6. Implementing the ‘Marketing Concept’ calls for studying the consumer behaviour. The shift from selling age to marketing age meant that customer’s needs be given priority over the hard-sell tactics. It was realised that consumer would not buy anything offered for sale. The consumer would buy only those products which are perceived to satisfy his needs and wants. Thus, identification of target market before production is essential to deliver the desired customer satisfaction and delight.
Importance for Marketer to Study the Consumer Behaviour:
(i) New Philosophy:
Consumer behaviour is a modern and new philosophy. It helps the marketers in identifying the needs and wants of the consumer and developing goods and services accordingly. Thus, a marketer by satisfying the needs and wants of the consumers can lure them away from the competitors. Hence it acts as an important tool for marketing success.
(ii) Achievement of Goals:
The ability to identify and satisfy the unfulfilled consumer needs is the key to a company’s survival, profitability and growth. Hence study of Consumer behaviour helps the company in achieving its marketing goals.
(iii) Helps Dealers and Salesmen:
The study of Consumer behaviour is very useful for dealers and salesmen. It helps them in meeting consumer needs and wants successfully. Hence, knowledge of Consumer behaviour is necessary for improving the performance of the entire distribution system.
(iv) Better Marketing Programme:
Marketing programme includes various elements like product, price, place and promotion. The study of consumer behaviour helps the marketers in preparing a better and more relevant marketing programme. Relevant and effective marketing programmes are essential for achieving marketing goals and objectives.
(v) Predicting Market Trend:
Consumer behaviour can also help in projecting the future market trends. Thorough analysis of Consumer behaviour helps the marketers in identifying various opportunities and threats existing in the marketing environment.
(vi) Consumer Differentiation:
Market consists of different kinds of customers. The needs and wants of every consumer segment is different from one another. For each and every segment a separate marketing programme is required.
It is essential for a marketer to collect information regarding the different consumer segments existing in the market. Consumer behaviour study provides great deal of assistance to the marketers in collecting information about consumer differentiations.
(vii) Competition:
Consumer behaviour study helps the marketers in facing intense competition in the market. After analysing the behaviour of the consumer a marketer can offer better goods and services to the consumer than that being offered by the competition. Therefore, consumer behaviour is useful for the marketers in maintaining their competitive strengths.
(viii) Creation and Retention of Consumers:
Marketers who offer goods and services as per the needs and wants of the consumers perform better in the market. Such marketers find it easy to sell their products.
Marketers who continuously monitor the behaviour of the consumers are in a better position to meet the changing tastes, expectations and preferences of the consumers. Such marketers can easily create new buyers and can conveniently retain the existing ones.