Read this essay to learn about Consumer Behaviour. After reading this essay you will learn about:- 1. Definition of Consumer Behaviour 2. Factors Influencing Consumer Behaviour 3. Study of Consumer as an Individual 4. Consumer Behaviour in their Cultural and Social Settings 5. Influence of Consumer Behaviour on Decision Making Process.
Essay Contents:
- Essay on the Definition of Consumer Behaviour
- Essay on the Factors Influencing Consumer Behaviour
- Essay on the Study of Consumer as an Individual
- Essay on the Consumer Behaviour in their Cultural and Social Settings
- Essay on the Influence of Consumer Behaviour on Decision Making Process
Essay # 1. Definition of Consumer Behaviour:
Consumer behaviour is defined as the behaviour that consumers display in searching for purchasing, using, evaluating and disposing of products, services and ideas that they expect will satisfy their needs.
The study of consumer behaviour is concerned not only with what consumers buy, but also with why they buy it, when, where and how they buy it and how often they buy it. Consumer behaviour is an integral part of strategic market planning.
The study of consumer behaviour is the study of how individuals make decisions to spend their available resources (time, effort, money) on consumption-related items. Methodology used to study consumer behaviour is known as consumer research.
Consumer research takes place at every phase of the consumption process; before the purchase, during the purchase, and after the purchase. The field of consumer research developed as an extension of the field of marketing research to enable marketers to predict how consumers would react in the market place and to understand the reasons they made the purchase decisions they did.
Since the market place is composed of different people, with different backgrounds, different interests, different needs and wants, it is necessary to segment the markets. Market segmentation is the process of dividing a market into distinct subsets of consumers with common needs or characteristics and selecting one or more segments to target with a specially designed marketing mix.
Following major categories of consumer characteristics provide the most popular basis for market segmentation:
1. Geographic factors
2. Demographic factors
3. Psychological characteristics
4. Sociocultural variables
5. Use-related characteristics
6. Use-situation factors
7. Benefits sought and
8. Hybrid segmentation forms.
Essay # 2. Factors Influencing Consumer Behaviour:
Consumer behaviour is influenced by following factors:
1. Cultural Factors:
Culture, subculture and social class.
2. Social Factors:
Reference groups, family, and roles and statuses.
3. Marketing Inputs:
Information from a variety of sources. Product, price, place and sales promotion information.
4. Situational Factors:
Users, usage occasions, availability of finance, availability of products.
5. Personal Factors:
Age, stage in the life cycle, occupation, economic circumstances, life-style, personality and self-concept.
6. Psychological Factors:
Motivation, perception, learning, beliefs, and attitudes.
Research into all these factors can provide clues as to how to reach and serve consumers more effectively.
Essay # 3. Study of Consumer as an Individual:
Consumer Needs:
Psychologists and consumer behaviourists agree that most people tend to experience the same kinds of needs and motives. Human-needs—consumer needs—are the basis of all modern marketing. Marketers do not create needs, they simply make consumers more keenly aware of unfelt needs.
Successful marketers define their markets in terms of the needs they presume to satisfy, rather than in terms of the products they sell. This is a market- oriented approach to marketing.
The specific courses of action that consumers pursue and their special goals are selected on the basis of their thinking processes (i.e. cognition) and previous learning. Therefore, marketers attempt to influence the consumer’s cognitive processes.
The needs are physiological (food, shelter, clothing etc.) and acquired needs (psychological needs like esteem, fear, love and acceptance). For any given need, there are many different and appropriate goals. The specific goal selected depends on the individual’s experiences, physical capacity, prevailing cultural norms and values, and the goals accessibility in the physical and social environment.
Needs and goals are interdependent and change in response to the individual’s physical condition, environment, interaction with other people, and experiences. As needs become satisfied, new higher-order needs emerge that must be fulfilled. Failure to achieve a goal often results in feelings of frustration.
Personality and Consumer Behaviour:
Personality can be defined as the psychological characteristics that both determine and reflect how a person responds to his or her environment. Trait personality theory states that individual possess innate psychological traits, e.g., innovativeness, novelty seeking, need for cognition, materialism, to a greater or lesser degree and that these traits can be measured by specially designed scales.
Each individual has a perceived self-image as a certain kind of person with certain traits, habits, possessions, relationships and ways of behaving. Consumers frequently attempt to preserve, enhance, alter, or extend their self-images by purchasing products or services and shopping at stores believed to be consistent with the relevant self-image and by avoiding products and stores that are not.
Consumer Perception:
Perception is a process by which an individual selects, organises, and interprets stimuli into a meaningful and coherent picture of the world. Examples of stimuli include products, packages, brand names, advertisements, and commercials. Sensory receptors are the human organs that receive sensory inputs.
The study of perception is largely the study of what we subconsciously add to or subtract from raw sensory inputs to produce our own private picture of the world. People organise these stimuli on the basis of certain psychological principles.
The interpretation of stimuli is also uniquely individual, because it is based on what individuals expect to see in light of their previous experience, on their motives, and interest at the time of perception.
Consumers have a number of enduring perceptions, or images that are particularly relevant to the study of consumer behaviour. Influences that tend to distort objective interpretation include physical appearances, stereotypes, halo effects, irrelevant cues, first impressions, and tendency to jump to conclusions.
Just as individuals have perceived images of themselves, they also have perceived images of products and services, of prices, product quality, retail stores, manufacturers, and of brands. Products and services that are perceived favourably have a much better chance of being purchased than products or services with unfavourable or neutral images.
Consumers often judge the quality of a product or service on the basis of informational cues ; some are influenced by colour, size, flavour etc. while others by price, store image, brand image, service environment etc.
In the absence of direct experience or other information, consumers often rely on price as an indicator of quality. Manufacturers who enjoy a favourable image generally find that their new products are accepted more readily than those of manufacturers with less favourable images.
Consumers generally perceive functional or financial risk in making product selection because of uncertainty as to the consequences of their decisions.
In order to reduce this perceived risk consumers strategy by increased information search, brand loyalty, buying a well-known brand, buying from a reputable retailer, buying the most expensive brand, and seeking reassurance in the form of money-back guarantees, warranties and pre-purchase trial.
This concept has important implications for marketers, who can facilitate the acceptance of new products by incorporating risk reduction strategies in their new product promotional campaigns.
Learning:
Learning is a process by which individuals acquire purchase and consumption knowledge and experience that they apply to future related behaviour. Cognitive learning theory is concerned with how information is processed by the human mind, how it is stored, retained and retrieved. The processes of memory include rehearsal, encoding, storage, and retrieval.
Consumer Attitudes:
Attitude research is undertaken to determine:
(a) Whether consumers will accept a proposed new-product idea,
(b) To learn how target customers are likely to react to a proposed change in the firm’s packaging.
Awareness of consumer attitudes is such a central concern of both product and service marketers that it is difficult to imagine any consumer research project that does not include the measurement of some aspect of consumer attitudes.
Attitudes are an expression of inner feelings that reflect whether a person is favourably or unfavourably predisposed to some ‘object’ e.g., a brand, a service, a product, product category, product use, price.
The formation of consumer attitudes is strongly influenced by:
(a) Personal experience
(b) Influence of family and friends
(c) Direct marketing
(d) Exposure to mass media
(e) Individual’s personality
Similar to attitude formation, attitude change is also influenced by:
(i) Learning,
(ii) Personal experience,
(iii) Other sources of information, and
(iv) Personality.
Attitude change strategies that can be used are:
1. Changing the consumer’s basic motivational function,
2. Associating the product with an admired group or event,
3. Resolving two conflicting attitudes,
4. Altering components of the multi-attribute model, and
5. Changing consumer beliefs about competitors brands.
Communication and Persuasion:
In order to create persuasive communications, the marketer must first establish the objectives of the communication, then select the appropriate audience for the message and the appropriate media through which to reach them, and then design the message in a manner that is appropriate to the medium and to the audience. A prompt feedback is also essential, to enable the marketer to make modifications to the media and message, if required.
Communications are of two types:
(a) Interpersonal Communication:
These occurs on a personal level between two or more people and may be verbal or nonverbal, in person, by telephone or by mail.
(b) Impersonal or Mass Communication:
In these, there is no direct contact between source and receiver through impersonal media such as television, radio, newspapers, or magazines.
Media selection depends upon the product, the audience and the advertising objectives of the campaign.
Essay # 4. Consumer Behaviour in their Cultural and Social Settings:
Group Dynamics:
Almost all individuals regularly interact with other people who directly or indirectly influence their purchase decisions. Hence, the study of groups and their impact on the individual is of great importance to marketers concerned with influencing consumer behaviour.
Following are the basic types of consumer-relevant groups which influence the consumption behaviour in individuals:
1. Family,
2. Friendship groups,
3. Formal social groups,
4. Shopping groups,
5. Consumer action groups and
6. Work groups.
Factors that affect the reference group influence are:
(a) Information and experience
(b) Credibility, attractiveness and power of reference group.
(c) Conspicuousness of the product.
Following major types of reference group appeals in common marketing usage are:
1. Celebrity appeals e.g. movie stars, TV personalities, popular entertainers, sport stars etc.
2. Expert appeals. A person who, because of his occupation, special experience is in a unique position to help the prospective consumer evaluate the product or service.
3. Common man appeals. In this, testimonials of satisfied customers are used to demonstrate to prospective customers that someone just like them uses and is satisfied with product or service.
4. Executive appeals. In this, firms use their top executives as spokespersons in consumer ads. because their appearance seems to imply that someone at the top is watching over the consumer’s interest.
5. Trade or spokes-character appeals.
These present an idealised image and dispense information that can be very important for the product or service.
These reference group appeals are effective promotional strategies because they increase brand awareness and reduce perceived risk among prospective customers.
Family Decision-Making:
Many marketers recognise the family as the basic decision-making unit, they most frequently examine the attitudes and behaviour of only one member who is a major decision-maker. Sometimes, they also examine the attitudes and behaviour of the primary user of the product or service.
The extent and nature of husband-wife influence in family decisions depends on the specific product or service, and the specific product feature under consideration.
Social Class and Consumer Behaviour:
Social class profiles provide a broad picture of the values, attitudes, and behaviour that distinguish the members of various social classes. Social class may be defined by the amount of status that members of a specific class possess in relation to members of other classes.
In recent years, some marketers has turned to geo-demographic clustering. Geo-demographic clustering is a technique that combines geographic and socioeconomic factors to locate concentrations of consumers with particular characteristics.
Consumer researchers have been able to relate social-class standing to consumer attitudes concerning specific products and social class influences on the actual consumption of products.
Influence of Culture:
In the context of consumer behaviour, culture is defined as the sum total of learned beliefs, values and customs that serve to regulate the consumer behaviour of members of a particular society. Beliefs and values are guides for consumer behaviour.
Subculture:
The members of a specific subculture possess beliefs, values and customs that set them apart from other members of the same society. Subculture defines a distinct cultural group that exists as an identifiable segment within a larger and more complex society. India has a large number of subcultures depending upon geographical location, castes, tribes, religion, age, sex, etc.
All consumers are simultaneously members of more than one subcultural segment. Therefore, marketers should strive to understand how multiple subcultural memberships interact to influence target consumers’ relevant consumption behaviour.
Cross-Cultural Consumer Analysis:
Cross-cultural consumer analysis is the effort to determine to what extent the consumers of two or more nations are similar or different. If international marketers are to satisfy the needs of consumers effectively, they must understand the relevant similarities and differences that exist between the peoples of the countries they decide to target.
Consumers have specific attitudes or even preference for products made in particular countries. These “country-of-origin” effects influence how consumers rate quality, and sometimes, which brands they will ultimately select.
Main problems involved in cross-cultural analysis are: differences in language, consumption patterns, needs, product usage, economic and social conditions, marketing conditions etc.
Cross-cultural analysis should be based on psychological, social, and cultural characteristics concerning the consumption habits of foreign consumers. Such analysis would identify increased marketing opportunities that would benefit both international marketers and their targeted consumers.
Essay # 5. Influence of Consumer Behaviour on Decision-Making Process:
Opinion Leadership:
Friends, neighbours, acquaintances, co-workers and others have influence on the individual’s consumption behaviour. Nature and dynamics of this influence called the opinion leadership process, and the personality and motivations of those who influence called the opinion leaders, and those who are influenced called the opinion receivers are need to be examined.
Opinion leadership is the process by which one person (the opinion leader) informally influences the actions or attitudes of others, who may be the opinion seekers or merely opinion recipients.
Marketing strategists concentrate their efforts more on the opinion leaders segment as compared to opinion receivers segment. Therefore, marketers can create opinion leaders for their products by taking socially involved or influential people and deliberately increase their enthusiasm for a product category.
Diffusion of Innovations:
The introduction of new products and services is vital to the:
(а) Consumers, as it represent increased opportunities to satisfy personal, social and environmental needs,
(b) Marketers, as it provide an important mechanism for keeping the firm competitive and profitable,
(c) Entire country or geographic regions or even the world, as it represent potential improvements in the quality of life for people.
The diffusion process and the adoption process are the two closely related concepts concerned with the acceptance of new products by consumers.
(а) Diffusion Process:
Diffusion process is concerned with how innovations spread, that is, how they are assimilated within a market. Diffusion can be defined as the process by which the acceptance of an innovation (a new product or service or idea or practice) is spread by communication (mass media, sales people or informal conversations) to members of a social system (a target market) over a period of time.
From the above, it is clear that diffusion process has following four basic elements:
(1) Innovation,
(2) Channels of communication,
(3) Social system, and
(4) Time.
(b) Adoption Process:
Individual consumer passes through different stages of a process while arriving at a decision to try or not to try or to continue using or to discontinue using a new product. This process of diffusion of innovation is known as adoption.
The stages in the adoption process are:
1. Awareness about the product innovation.
2. Interest in the product.
3. Evaluation of the product innovation.
4. Trial of the product on a limited basis.
5. Adoption or rejection based on their trials.
The product characteristics which influence the acceptance of a new product by the consumers are:
(1) Relative advantage
(2) Compatibility
(3) Complexibility
(4) Trialability
(5) Communicability.
New product marketers are vitally concerned with identifying the consumer innovator so that they may direct their promotional campaigns to the people who are most likely to try new products, adopt them, and influence others.
Variables in Consumer Decision-Making:
The decision model has three sets of variables:
1. Input variables,
2. Process variables and
3. Output variables.
Input variables that affect the decision-making process include commercial marketing efforts, as well as non-commercial influences from the consumer’s sociocultural environment.
Decision process variables are influenced by the consumer’s psychological field, including the evoked set {i.e. the brands in making a purchase choice). The psychological field influences the consumer’s recognition of a need, pre-purchase search for information and evaluation of alternatives.
The output phase of the decision model includes the actual purchase (either trial or repeat purchase) and post purchase evaluation. Both pre-purchase and post purchase evaluation feedback in the form of experience into the consumer’s psychological field, and serve to influence future decision processing.
Consumer behaviour is not just making a purchase decision or the act of purchasing, it also includes the full range of experiences associated with using or consuming products and services. It also includes the sense of pleasure and satisfaction derived from possessing or collecting “things”.
The outputs of consumption are:
(i) Changes in feelings, moods or attitudes;
(ii) Reinforcement of lifestyles, an enhanced sense of self, satisfaction of consumer related need;
(iii) Belonging to groups;
(iv) Expressing and entertaining oneself.