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There are three important terms in marketing that are commonly used as interchangeable terms.(I) Consumer(II) Buyer(III) Customer
Consumer The term consumer represents human beings, animals birds trees and all those who have a capacity to consume.
Buyer Buyers are those who buy goods or services. All buyers are human beings. Buyers also represent those consumers who can’t become buyers on their own. Therefore all consumers are not buyers and all buyers need not to be consumers.
Customer The term customer finds meaning from the point of view of seller. We can find a customer for a company, shop, brand, product, class and so on. If a buyer repeatedly purchases products of one company he is called customer of company. Similarly if he buys from same shop, he is customer of shop.
Factors influencing consumerbehavior The behavior of consumer is influenced broadly by three important factors. They are:(I) Cultural and social factors(II) Personal and physical factors(III) Psychological factors
Cultural and social factors Cultural factors have deepest influence on the behavior of human beings. Culture is acquired. There are three sources of cultural learning . Parents, grandparents, elders and other members of a family teach and train a child how to behave. This is called formal learning. The child observes in society the behavior of others with whom he interacts and tries to intimate their behavior. This is called informal learning.
The third is technical learning where the child learns many things in educational institutions and the environment, developing analytical abilities.
Another important dimension of culture is social class- social classes are relatively homogenous and follow a hierarchical order. The most popular variable that decides the hierarchy of social class is income. However other variable such as occupation, education and place of residence can also be used, either separately or in combination, to decide social hierarchy.
Based on income a society can be divided into nine groups(I) Upper upper class(II) Middle Upper class(III) lower Upper class(IV) Upper middle class(V) Middle Middle class(VI) Lower middle class(VII)Upper lower class(VIII)Middle lower class(IX) Lower lower class
The major social groups that influence consumer behavior are family and reference groups. Family: A family is very close social group, within which individuals interact regularly. Members of family share values, habits, life styles and so on. Relationship within family are mutually inspiring, influencing the managing of the life pattern of each and every individual.
Reference groups: A reference group is any person or group that serves as a point of comparison for an individual while forming either general or specific values, attitudes or a specific guide of behavior. Consumers are generally influenced by primary group, secondary group, aspirational groups, associative groups and disassociative groups.
Primary group: It consists of family, relatives, friends, neighbors and co-workers. Secondary group: It consists of people connected with religion, regional and professional. Aspirational group: It consists of those persons with whom an individual develops an interest to join. Individuals try to associate themselves formally with some groups, with whom opinions and attitudes can be shared. Disassociative groups: It consists of those persons whose behavior is against the value system and life styles of an individual.
Personal and physical factors Education Occupation Status Economic position Personality and self concept Life style Age Sex Health Height and weight beauty
Psychological factors Motivation Perception Learning Attitudes and belief
How do customers developexpectationsLevel of service performance Customer responseExceeding maximum expected level Highly satisfied or delightedMaximum service level SatisfiedAdequate service level IndifferentMinimum service level DissatisfiedBelow minimum level Highly dissatisfied
Maximum service level Zone of tolerance Minimum service level
Maximum service level is blend of what the customer believes ‘can be and should be’. For example if you take the services of your college placement cell, your expectations in all likelihood would be a right job in right location for the right salary. However you are aware of the constraints in obtaining jobs – the vacancy position in various companies, the competition and the changing expectations of market. Due to this reason you may hold a lower level of expectation for the acceptance of the service. This lower expectation is called minimum service level.
The zone of tolerance is the extent to which customers recognize or are willing to accept the variation between the two levels of expectations, that is the maximum level and the minimum level. If the performance of the service is below the minimum level the customer will be frustrated and highly dissatisfied.
Consumer purchase decisionprocess Problem Evaluation ofidentification service Post purchaseand definition alternatives evaluation Information Service search purchase and consumption
Problem identification This is the first step in the consumer decision making process. Problem identification represents a perceived gap between the existing level and the desired level of customer living. Every gap identified by consumer will not become a need. The perceived level must cross a level, called threshold level, to become felt need.
Consumers do not react similarly for every felt need . The reaction of the buyer depends upon the level of involvement in the problem solving. At least three types of behaviors can be identified in this respect. HIPS: High involvement problem solving LIPS: Low involvement problem solving ZIPS: Zero involvement problem solving or routinised response.
Information search Research for information depends upon certain properties of the market offers. Economists have identified two categories of properties of consumer products. They are:(I) Search qualities: the attributes of the offer can be determined by the consumer before purchasing a product. For example, color, style, price, feel and smell.(II) Experience qualities: the attributes of the offer can be known either during consumption or after the purchase. E.g. taste wearability etc.
Later on third category was identified as credence qualities Credence qualities: The attributes of the offer that consumer may find impossible to evaluate even after the purchase and consumption.
Evaluation of service alternatives Customer evaluate the services of various companies and then take the decision accordingly. Service purchase and consumption Post purchase evaluation