2. CONSUMER
What is Consumer
A consumer is the one who purchases the product for his/her own
need and uses or consumes it. A consumer cannot resell the good,
product or service but can consume it to earn his/her livelihood and
self-employment.
Definition of consumer
The consumer is the one who is the end-user of any goods or
services. Any person, other than the buyer who buys the product or
services and consumes the product by taking his/her permission is
categorized as a consumer. Any single or group of people, other than
the buyer who buys the product or services, consumes the product
by seeking his/her permission falls under the category of a
consumer. In simpler words, the consumer can be termed as the
end-user of the goods or services.
3. CONSUMER PROFILE: DEFINING THE IDEAL
CUSTOMER
Definition
A consumer profile is a description of a customer, or a set of customers, based on the characteristics that they have in common.
Before marketing a product to potential customers, you will need to define your target customer based on their:
• Lifestyle
• Age
• Location
• Income
• Interests
• Buying patterns
• Purchasing preferences
• Stage of life
Why Consumer profiling is required
Every business should invest time and resources in creating consumer profiles of their ideal customers.
These profiles describe consumers based on different categories mentioned above so they can be grouped for marketing
and advertising purposes. By targeting advertising to a specific market segment, companies and marketers can find more
success in selling a particular product and increase profits.
4. DIFFERENT
METHODS/APPROACH
USED FOR CUSTOMERS
PROFILING
1) The Psychographic Approach
• The psychographic approach takes a look at customers’ lifestyles to
define market segments. Many components play a role in using the
psychographic approach, such as activities, interests, values, and social
class.
• Lifestyle and demographics are factors that include age, location, and
gender. For example, a customer’s lifestyle determines how your
product will fit into the needs of school-going, college-going, and office-
going customers’ buying habits respectively.
• Activities, interests, and opinions are a subset of lifestyle, focusing on
your customers’ activities, interests, and opinions. It’s not a problem if
customer A enjoys books while customer B prefers novels – both of
them are readers, and that is how you profile them.
• Values, attitudes, and social class pertain to how people were brought
up. These affect how they spend their money and what they choose to
spend their money on. Social class is especially important, as their
income determines their buying power.
5. 2) The Consumer Typology Approach
• The customer typology approach segregates consumers based on their
motivations, their mindsets, and how to engage them. There are usually four
types of consumers: loyal consumers, discount consumers, impulsive
consumers, and need-based consumers.
• Loyal consumers are rare, but valuable. They tend to remain loyal to a
brand and promote these brands through word-of-mouth.
• Discount consumers, on the other hand, don’t prefer one brand over
another. They will only make a purchase if there is a discount or a sale.
• Impulsive consumers do not shop with anything specific in mind. Unlike
either loyal or discount consumers, they aren’t looking for a product, service,
or brand, and spend their money capriciously. They are more emotionally
driven rather than logically driven when making decisions.
• Need-based consumers are the opposite of impulsive ones, as they will only
purchase a product or service to fulfill a need. They are the type who would
enter a store quickly, make a purchase, then leave.
6. The Consumer Characteristics Approach
• The consumer characteristics approach asks what traits influence buying
decisions. There are a variety of consumer characteristics, but there are three
common ones that define modern consumers.
• Convenience-driven is one trait that characterizes a modern consumer.
These are the customers who may not have much time on their hands, so
they order products or services online so these arrive faster. For them,
everything should be fast, simple, and easy to use.
• Connectivity-driven consumers want to feel part of a community; they feel
connected to someone else if both purchase the same product. Connectivity-
driven consumers also tend to listen to other people for their opinion on
products, services, and brands. If one person says the product is good, then
these consumers would be more inclined to make the same purchase.
• Personalization-driven consumers would prefer a customer experience that
is customized for them specifically. These consumers value making the
choice of how a product will look, or how a service will be attuned to their
needs exactly.
7. DEFINITION OF CONSUMERISM
• Consumerism is defined as social force designed to protect consumer interests in the marketplace by
organising consumer pressures on business. Consumerism is a protest of consumers against unfair
business practices and business injustices.
• It aims to remove those injustices, and eliminate those unfair marketing practices, e.g., misbranding,
spurious products, unsafe products, planned obsolescence, adulteration, fictitious pricing, price
collusion, deceptive packaging, false and misleading advertisements, defective warranties, hoarding,
profiteering, black marketing, short weights and measures, etc.”
8. HISTORY OF
CONSUMERISM
Consumerism is an economic and societal way of viewing and understanding the
economy, which focuses on the idea of the consumption of a steady supply of goods
and services by the citizens of a given country. The consumption of goods and services
by individual consumers helps drive the economic engine of a consumerist society in
that it creates jobs for workers and wealth for businesses owners. While consumerism
as an ideology can be present in several different types of economic systems, it is most
often associated with capitalism. In particular, consumerism plays an important role in
modern democratic countries with mixed economies such as: the United States,
England, France, Canada, etc. Furthermore, consumerism is an important component
of the concept of supply and demand because it involves the supply of goods and
services and the demand (consumption) of goods and services by individual
consumers. To fully understand the significance of consumerism as an ideology it’s
also important to understand its development throughout history.
While people across many different civilizations and time periods have always
purchased and consumed goods, the modern concept of consumerism is best
understood to have begun in the late 1600s in Europe. From that point, consumerism
intensified throughout the 1700s and 1800s and became a major societal phenomenon
in which the consumption of products became a vitally important task for most people in
society. As stated above, consumerism is generally associated with the economic
system of capitalism. As such, consumerism as an ideology emerged alongside
capitalism and spread throughout Europe, North America and the rest of the world as
capitalism became the dominant economic system on the planet. During the early
years of the development of consumerism, two major historical events came to play an
important role, which included: Industrial Revolution and the Age of Imperialism.
9. What is Consumerism?
• Consumer is regarded as the king in modern marketing. In
a market economy, the concept of consumer is given the
highest priority, and every effort is made to encourage
consumer satisfaction.
• However, there might be instances where consumers are
generally ignored and sometimes they are being exploited
as well. Therefore, consumers come together for protecting
their individual interests. It is a peaceful and democratic
movement for self-protection against their exploitation.
Consumer movement is also referred as consumerism.
10. FEATURES OF
CONSUMERIS
M
Highlighted here are some of the notable features of consumerism −
• Protection of Rights − Consumerism helps in building business
communities and institutions to protect their rights from unfair
practices.
• Prevention of Malpractices − Consumerism prevents unfair practices
within the business community, such as hoarding, adulteration, black
marketing, profiteering, etc.
• Unity among Consumers − Consumerism aims at creating knowledge
and harmony among consumers and to take group measures on issues
like consumer laws, supply of information about marketing malpractices,
misleading and restrictive trade practices.
• Enforcing Consumer Rights − Consumerism aims at applying the four
basic rights of consumers which are Right to Safety, Right to be
Informed, Right to Choose, and Right to Redress.
11. INTRODUCTION TO CONSUMER BEHAVIOUR
Consumer Behaviour is the study of how individual customers, groups or organizations select, buy, use,
and dispose ideas, goods, and services to satisfy their needs and wants. It refers to the actions of the
consumers in the marketplace and the underlying motives for those actions. The study of consumer
Behaviour assumes that the consumers are actors in the marketplace. The perspective of role theory
assumes that consumers play various roles in the marketplace. Starting from the information provider,
from the user to the payer and to the disposer, consumers play these roles in the decision process.
Meaning and Definition:
Consumer Behaviour is the study of how individual customers, groups or organizations select, buy, use,
and dispose ideas, goods, and services to satisfy their needs and wants. It refers to the actions of the
consumers in the marketplace and the underlying motives for those actions. In the words of Engel,
Blackwell, and Mansard, “consumer Behaviour is the actions and decision processes of people who
purchase goods and services for personal consumption”
12. NATURE OF CONSUMER BEHAVIOUR:
1. Influenced by various factors:
i. Marketing factors such as product design, price, promotion, packaging, positioning and
distribution.
ii. Personal factors such as age, gender, education and income level.
iii. Psychological factors such as buying motives, perception of the product and attitudes
towards the product.
iv. Situational factors such as physical surroundings at the time of purchase, social
surroundings and time factor
v. Social factors such as social status, reference groups and family
i. Cultural factors, such as religion, social class—caste and sub-castes.
13. CONTD…..
2. Undergoes a constant change: Consumer Behaviour is not static. It undergoes a change over a period of time
depending on the nature of products.
3. Varies from consumer to consumer: All consumers do not behave in the same manner. Different consumers behave
differently. The differences in consumer Behaviour are due to individual factors such as the nature of the consumers,
lifestyle and culture.
4. Varies from region to region and country to county: The consumer Behaviour varies across states, regions and
countries. It may differ depending on the upbringing, lifestyles and level of development.
5. Information on consumer Behaviour is important to the marketers: Marketers need to have a good knowledge of
the consumer Behaviour. They need to study the various factors that influence the consumer Behaviour of their target
customers. i.e. Product design/model, pricing, packaging, positioning, promotion of product etc…
6. Leads to purchase decision: A positive consumer Behaviour leads to a purchase decision. A consumer may take the
decision of buying a product on the basis of different buying motives. The purchase decision leads to higher demand,
and the sales of the marketers increase.
14. CONTD….
7. Varies from product to product: Consumer Behaviour is different for different products. There
are some consumers who may buy more quantity of certain items and very low or no quantity of
other items.
8. Improves standard of living: The buying Behaviour of the consumers may lead to higher
standard of living. The more a person buys the goods and services, the higher is the standard of
living. But if a person spends less on goods and services, despite having a good income, they
deprives themselves of higher standard of living.
9. Reflects status: The consumer Behaviour is not only influenced by the status of a consumer, but
it also reflects it. The consumers who own luxury products like luxury car, watches and other items
are considered belonging to a higher status. The luxury items also give a sense of pride to the
owners
15. CONSUMERISM IN INDIA – CONSUMER PROTECTION
• The idea of consumer supremacy and consumer sovereignty is definitely fallacious in a free market
economy. In reality, consumer is not a king or queen. The manufacturer or the seller is dominant and
his voice is all powerful. His interests normally prevail over the welfare of the consumer.
• The root-cause of consumer movement or consumerism is ‘consumer dissonance’, as it has been so
nicely termed. Dissonance means after purchase doubts, dissatisfaction, disillusion, disappointment.
These are the sentiments of all dethroned sovereigns. But the consumer protection (the core of
consumerism) is essential for a healthy economy.
• Basically, consumers are demanding four ‘rights’ from the company-
1. Safety of products,
2. full and accurate information about products and services (without which some articles may not be usable and
may produce sales-resistance)
3. a choice
4. voice (redress).
16. FACTORS INFLUENCING CONSUMER BEHAVIOUR:
The behaviour of consumer is dependent on a number of factors which may be economic or non-
economic factors and are dependent upon economic factors such as income, price, psychology,
sociology, anthropology, culture and climate. The study of consumer behaviour has proved that following
are the main factors which influence the behaviour:
1. Economic Factors: Price, Income, Distribution of Income, Competition with substitute , utility and
Consumer preferences are the factors categorised as Economic factors .
2. Social Factors: Culture, Attitude of society, social values, Life-style, personality, Size of family,
Education, health standards are the factors catagorised as Social factors.
3. Psychology : It decides the personality, taste, attitudes of individuals or groups, life style, preferences
especially on occasions like marriage. The demonstration influence is also dependent upon psychology
of an individual.
17. CONTD….
4. Anthropology & Geography: Climate, region, history all effect, consumer
behaviour. In hot countries like India certain products which keep us cool like
squashes, sarbatas, are demanded but they have no demand in cold regions.
Culture is also influenced by climate.
5. Technology: In case of equipment’s whether for consumer use or industrial use is
affected by technological innovations and features. Even in case of perishable
goods the shelf life etc are determined by technological developments. Innovations
and introduction of new product also depends upon technological development.
6. Others: Knowledge-technical or otherwise and information. Government
decisions, laws, distribution policies, production policies have also big affect on
consumer behaviour
18. CONSUMERISM IN INDIA – NEED FOR CONSUMER PROTECTION
• Consumer choice is influenced by mass advertising using highly developed arts of persuasion. The consumer typically
cannot know whether drug preparations meet minimum standards of safety, quality and efficacy. He usually does not
know whether one prepared food has more nutritional value than others; whether the performance of a product will
in fact meet his needs and expectations; or whether the “large economy size” is really a bargain. Hence, we need
consumer protection.
• 1. Physical protection of the consumer, for instance, protection against products that are unsafe or endanger health
and welfare of consumer.
• 2. Protection of the consumer against deceptive and unfair trade practices. Consumer must have adequate rights and
means of redress against business malpractices and frauds.
• 3. Ecological and environmental effects of chemical, fertiliser or refinery complexes will have to be seriously
considered because they pollute water, air and food and endanger human life. Consumer wants due protection
against all types of pollution; he wants enriched quality of life — a beautiful, healthy, and peaceful environment free
from pollution.
