Consumer behavior all material Prepared by karventhan
A CUSTOMER IS THE MOST IMPORTANT VISITOR ON
HE IS NOT DEPENDENT ON US,
WE ARE DEPENDENT ON HIM.
HE IS NOT AN INTERRUPTION ON OUR WORK, HE IS
THE PURPOSE OF IT.
HE IS NOT AN OUTSIDER ON OUR BUSINESS
HE IS A PART OF IT.
WE ARE NOT DOING HIM A FAVOUR BY SERVING
HE IS DOING US A FAVOUR BY GIVING US THE
OPPORTUNITY TO DO SO.
The term Consumer Behavior, individual buyer
behavior, end user and consumer buying behavior all
stands for the same.
It includes the study of what they buy, why they buy
it, when they buy it, where they buy it, how often they
buy it, and how often they use it.
Consumer behaviour refers to the actions of consumers in
the market place& underlying motives for those actions.
Marketers need to understand why customer buy a
particular goods & services they will be able to
Which products are needed in the market place,
How best to present the goods to the consumers. product
It attempts to understand the buyer decision making
process, both individually and in groups. It also tries to
assess influences on the consumer from groups such as
family, friends, reference groups, and society in general.
Concept of Consumer Behavior
Consumer Behaviour is the study of the following
Why and why not a consumer buys product?
When a consumer buys a product?
How a consumer buys a product?
The people do or do not buy a product.
Difference between Consumer and
Generally, a consumer refers to individuals who buy for themselves or
their family (hence the term 'consumerism' in economics and
politics), whereas a customer can also mean the retailer or person who
buys from the manufacturer, etc. for ultimate sale to others.
The one who buys the product is called a customer and the who uses
the product is called a consumer.
A consumer is anyone who typically engages in any one or all of the
activities mentioned in the definition. Traditionally, consumers have
been defined very strictly in terms of economic goods and services
wherein a monetary exchange is involved. This concept, over a period
of time, has been broadened. Some scholars also include goods and
services where a monetary transaction is not involved and thus the
users of the services of voluntary organisations are also thought of as
consumers. This means that organisations such as UNICEF, CRY, or
political groups can view their public as "consumers".
“Consumer Behavior is the process and activities
people engage in when searching
for, selecting, purchasing, using, evaluating, and
disposing of products and services so as to satisfy their
needs and desires.”
Belch and Belch
Characteristics of Consumer
Price Elasticity of Demand.
Scope of Consumer Behavior
‘What’ the consumers buy: goods and services
‘Why’ they buy it: need and want
‘When’ do they buy it: time:
day, week, month, year, occasions etc.
‘Where’ they buy it: place
‘How often they buy’ it: time interval
- ‘How often they use’ it: frequency of use .
Significance of Consumer
The Study of Consumers’ Behavior is vital in framing production
policies, price policies, decisions regarding channels of distribution
and decisions regarding sales promotion.
Decision regarding channels of distribution
Decision regarding sales promotion
Exploiting Marketing Opportunities of competitors
Consumer do not always act or react Predictably
Consumer preference are changing and becoming highly diversified.
Rapid Introduction of New Products
Implementing the “Marketing Concepts”
Dimensions of Consumer Behavior
when they buy
how they buywhere they buy
why they buy
1. Psychological Factor
a) Motivation – motivation is a willing to achieve a certain
goal, motivation could be effected because of consumer financial
b) Perception - what perception consumer have about a certain product
c)Knowledge & Education Level - Every consumer takes decision
according to their knowledge and education level so consumer
behavior can change if they feel new information about a product. So
knowledge and education is an important factor for consumer to buy a
product or hiring services
d) Attitude - consumer attitude suggest how they are motivated towards
e)Life Style – how consumer give value of their life and what way life they
f) Culture – culture is an external influence, how we live and what we
g)Group Membership – another external influence factors , often
consumer belong to many other groups which may affect consumer
2. Sociological factor - A lot of sociological factor could
affect consumer behaviour like Family
life, age, education level, good and bad sociological
3. Economic Factor - Economic factor is a significant
factor in consumer behavior , a lot of consumer can
suffer because of poor economic conditions.
The Internal Influences of CB
d =>Beliefs and Attitude
a=>Age and Life Cycle Stage
b=>Occupation and Economic
e =>Life style
f =>Self image
State the External Influences of
1. Socio-cultural Influences
2 Social class
4. Reference Group
5. Roles and Status
Applications of knowledge of
consumer behavior in marketing
Analyzing market opportunity
Selecting the target market
Determining the marketing mix
Product ( ex : Maggi)
• Use in Non-profit and Social Marketing
Industrial and individual consumer
INDUSTRIAL CONSUMER BEHAVIOUR
An organizational buying is a process by which a
company/organization establishes a need for
purchasing products and choose among competing
brands and suppliers.
Reason to buy product:
In production of another product
supplied to others
CONSUMER BUYING BEHAVIOUR
The process by which individuals search for
select, purchase, use and dispose of goods and
services, in satisfaction of their needs and wants.
A firm needs to analyze buying behavior for:
Buyer’s reactions to a firms marketing strategy has a great
impact on the firm’s success.
The marketing concept stresses that a firm should create a
Marketing Mix (MM) that satisfies (gives utility to)
customers, therefore need to analyze the
what, where, when and how consumers buy.
Marketers can better predict how consumers will respond
to marketing strategies.
VARIOUS STAGES OF THE CONSUMER BUYING
Problem recognition (Awareness of need):
*Difference between the desired state and the actual
condition. Deficit in assortment of products.
* Hunger--Food. Hunger stimulates your need to eat.
Internal search, memory.
External search if you need more information. Friends and
relatives (word of mouth). Marketer dominated sources;
comparison shopping; public sources etc.
Evaluation of Alternatives:
- Need to establish criteria for evaluation, features the
buyer wants or does not want.
Choose buying alternative, includes
product, package, store, method of purchase etc .
May differ from decision, time lapse between 4 &
5, product availability.
Outcome: satisfaction or dissatisfaction. Cognitive
dissonance, have you made the right decision. This can be
reduced by warranties, after sales communication etc
Perceptual FilterBy learning we mean how someone changes what they know, which in turn may affect
how they act. There are many theories of learning, a discussion of which is beyond the scope
of this tutorial, however, suffice to say that people are likely to learn in different ways. For
instance, one person may be able to focus very strongly on a certain advertisement and be
able to retain the information after being exposed only one time while another person
may need to be exposed to the same advertisement many times before he/she even
recognizes what it is. Consumers are also more likely to retain information if a person has a
strong interest in the stimuli. If a person is in need of new car they are more likely to pay
attention to a new advertisement for a car while someone who does not need a car may need to
see the advertisement many times before they recognize the brand of automobile.
Impulse purchase(lip moisturizer, magazines and
Routine purchase(milk, eggs and cheese)
Limited Decision Making(hair colour)
Extensive Decision Making (tv,car,a home,computer)
The Nicosia model
This model focuses on the relationship
between the firm and its potential consumers. The
firm communicates with consumers through its
marketing messages (advertising), and the consumers
react to these messages by purchasing response.
Looking to the model we will find that the firm and
the consumer are connected with each other, the firm
tries to influence the consumer and the consumer is
influencing the firm by his decision.
Source: Nicosia, (1976).
The Nicosia model is divided into four major fields:
Field 1: The consumer attitude based on the firms’
Field 2:search and evolution
Field 3:act of purchase
Webster and Wind Model
This is a complex model developed by F.E.Webster and
Y. Wind as an attempt to explain the multifaceted
nature of organization buying behavior
Refers to the environmental , organizational
, interpersonal and individual buying determinants
which influences the organizational buyer’s
PSYCHOLOGICAL INFLUENCES ON
Concepts such as motivation and personality;
perception; learning; values, beliefs and attitudes; and
lifestyle are useful for interpreting buying processes
and directing marketing efforts.
Motivation is the energizing force that causes
behaviour that satisfies a need.
An individual consumer may purchase an item
that they believe will further the own goals or will
satisfy a need they have. For example, a shopper may
stop at the mall food court because they are
hungry, and may select a salad to eat because they
believe it will help them achieve weight loss or a
Motivation can be defined as the processes that
account for an individual’s intensity, direction, and
persistence of effort toward attaining a goal.
The following are the three key elements in this
1. Intensity: how hard a person tries
2. Direction: toward beneficial goal
3. Persistence: how long a person tries
Motivation is an inner drive that reflects goal-
directed arousal. In a consumer behaviour context, the
result is a desire for a product, service, or experience.
It is the drive to satisfy needs and wants, both physiological
and psychological, through the purchase and use of
products and services
Five stages of the motivation process:
Want or desire
Behavioural Models of
Abraham Maslow’s “Need
Maslow’s Hierarchy of Needs
General Examples Organizational Examples
Types of Motivation
Positive Motivation(Financial and non Financial )
The Dynamic Nature of Motivation
Needs are never fully satisfied
New needs emerge as old needs are satisfied
People who achieve their goals set new and higher
goals for themselves
Arousal of Motives
The arousal of any particular set of needs at a specific
moment in time may be caused by internal stimuli
found in the individual’s physiological condition, by
emotional or cognitive processes or by stimuli in
Perception is the process through which the
information from outside environment is
selected, received, organized and interpreted to make
it meaningful to us.
According to S.P. Robbins, “Perception may be defined
as a process by which individuals organize and
interpret their sensory impressions in order to give
meaning to their environment.”
Factors that influence perception:
1) Factors in the perceiver
2) Factors in the situation
3)Factors in the target
Learning may be defined as “The process of
acquiring the ability to respond adequately to a
situation which may or may not have been previously
encountered, the favourable modification of response
tendencies consequent upon previous experience; the
process of acquiring insight into situation.”
According to E.R.Hilgar, “Learning is a
relatively permanent change in behavior that occurs as
a result of prior experience.”
Classical conditioning-(e.g. Dog , bell, time,etc)
Operant conditioning ((e.g. if you insert a coin in coffee
machine you can get coffee. You leant from past experience
how to cause the environment to deliver a cup of coffee)
Social conditioning (the ability of individual by observing
others. i.e. can leant from parents, peers, boss, etc.people
gain elf confident when someone else do it than are simply
told what to do)
Cognitive conditioning(people draw on their experience
and use past learning as the basis for present experience)
What are the various Elements of Learning
Cues(indicator e.g.“ first step is the best step” and base
on time it varies)
Response(choice of behaviour)
Reinforcement(consequence i.e. support,back up))
How learning Influences on Consumer Behavior.
Recognition and Recall
Cognitive Responses to Advertising
Attitudinal and Behavioural Measures of Brand
The term Personality has been derived from Latin
word “Personare” which means ‘to speak through’.
Personality is an individual’s characteristics
response tendencies across similar situations.
According to Schiffman and Kanuk, “Personality
can be defined as those inner psychological
characteristics that both determine and reflect how a
person responds to his or her environment.”
The Nature of Personality
Impact (force)Behaviours and Actions
Psychological and physiological(shaped by
environment i.e. life experience and our parents
Personality reflects Individual Differences
Personality is consistent(steady) and enduring(long
Personality can change
Significance of Personality
Differential Emotional Reactions
Differential Stress Handling
Theories of Personality
1) Type (individual are categorised depending on their physical
characteristics e.g. age)
2)Trait(factor analysis and rating scale used, he will be describe
himself about his attitude, feeling , etc and asked with other
person to evaluate from what he knows about individual)
3)Psychoanalytic (comprises id, ego and super ego) (a hunger
man can (relax) experience partial gratification of his hunger by
imagining a delicious meal- id, ego- man cannot satisfy his
hunger by eating image, reality must considered, super ego-
judge whether an action is right or Wrong according to the
standard of society,
4) Social learning (stresses on the change of behaviour
through learning from several sources i.e. the person action in
given situation according to specific characteristics of situation)
5) Humanistic (behaviour depends on how an individual
perceives the world)
Attitude is defined as a mental, emotional or
rational predisposition with regard to a
fact, state, person or an object. In the context of
consumer behaviour we are studying the attitude of
buyers towards all the relevant attributes of a product
or services as well as the marketer and market.
It is feeling or beliefs of an individual or
groups of people.
Characteristics of Attitude
The attitudes that have significant influence on an
individual’s behaviour & personality have certain
characteristics. Attitude is formed on the basis of
learning, knowledge, information, upbringing
(education), thinking, lifestyle, experience, predispos
(tendency), belief, faith, outlook, communication, ob
servation, etc. It can be good or bad, optimistic or
pessimistic, positive or negative, broad or narrow
friendly or unfriendly & so on. It may be consistent, may
change with several external factors like time or
environment, may be influenced or even can influence
Three components of attitude
1. Affective (feelings, sentiments and emotions about
some idea, person, event)
2. Behaviour (predisposition (tendency) to get on a
favourable or unfavourable evaluation of something)
3. Cognitive (beliefs, opinion, knowledge, or
information held by individual)
Self and Self-Image
A person’s perceptions of his/her self
People have multiple selves
Different selves in different situations
Different Self Images
How you see your self
How you would like to see yourself
How you think others see you
Ideal Social Self-Image
How you would like others to see you
How you expect to be in the future
The qualities that you think you should possess
Consumer Expectation may be defined as the desires
or wants of the consumer.
These expectations are in most
instances, different from what the customer gets in a
real-life situation from the organization
Consumer Expectations and
Consumer expectations and satisfaction also impact
Expectations are defined as beliefs about a product’s or
service’s attributes or performance at sometime in the
future and are a key determinant of satisfaction.
Consumer Expectation + Lower customer service =
Consumer Expectation+ Equal customer service=
Consumer Expectation + Higher customer service=
The Issues relating to Consumer
Knowledge and Expectation of Consumer.
Level of Expectation
Performance Significantly below Expectations
Components of Expectations
Define Consumer Satisfaction
Customer Satisfaction is the attitude-like feeling of a
customer towards a product or service after it has been
It is generally described as the full meeting of one’s
The Factors Influencing Consumer Satisfaction
Various Benefits of Consumer Satisfaction
Managing Consumer Satisfaction
There are several things that marketers can to manage
customer satisfaction and leverage it in their
Understand what can Go Wrong
Focus on Controllable Issues
Manage Customer Expectations
Offer Satisfaction Guarantees
Make it Easy for customers to complain
Create relationship programs
Socio-cultural environment refers to influence
exercised by certain social and cultural factor on the
purchase behavior of consumer. Such factors include
culture , Social class , family and reference group
etc. Socio –Cultural environment is interaction of
social environment with cultural environment , etc .
social environment refers to influence exercised by
certain social institutions and social system, like
family reference group etc . Cultural environment
refers to influence exercised by cultural factor , viz
., customs , value system , habit , preferences
, education , language, traditions , etc . .
Consumer purchasing decisions are often
affected by factors that are outside of their control but
have direct or indirect impact on how we live and what
we consume. One example of this are cultural factors
Culture is defined as the patterns of behavior and
that characterize a society and separate it from others.
Culture conveys values,
ideals, and attitudes that help individuals
communicate with each other
and evaluate situations An individual’s culture
provides a frame of reference concerning acceptable
behaviors, and as such, culture is a learned set of
Culture represents the behavior, beliefs and, in
many cases, the way we act learned by interacting or
observing other members of society. In this way much
of what we do is shared behavior, passed along from
one member of society to another. Yet culture is a
broad concept that, while of interest to marketers, is
not nearly as important as understanding what occurs
within smaller groups or Sub-Cultures to which we
may also belong. Sub-cultures also have shared values
but this occurs within smaller groups. For
instance, sub-cultures exist where groups share similar
values in terms of ethnicity, religious
beliefs, geographic location, special interests and
Culture is defined as the complex, sum
knowledge, belief, traditions, customs, art, morals, law and
any other habits acquired by people as members of a
society. Culture of one society differs from that of another.
Many of our actions and behavior as consumers stem from
our cultural background.
MAGGI has now become an integral part of consumers
preferring fast food. The societal culture has now
drastically changed. Women, who were earlier considered
as homemakers only have now stepped out of their homes
and are engrossed with hectic schedules. They largely opt
for such alternatives that are less time consuming and even
healthy for their family.
Sub-Cultural Influences Within a given culture, there
are many groups or segments of people with distinct
customs, tradition and behaviour, which set them apart from
other people. All Indians share one common cultural
heritage, but the Hindu Brahmins of Tamil Nadu are very
different from the Hindu Bengalis of Calcutta in the same way as
Kashmiri Hindus are different from the Hindus of Gujarat. Each
of these people, within one cultural mainstream have uniquely
distinct sub-cultures. They have their style of dress, food
habits, religious traditions and rites(resources)all of which have
implication for the marketer.Considering the local tastes and
preferences that form a part of the
subculture, MAGGI introduced its Rice Mania in Shahi Pulao for
the North, Lemon Masala for the South and Chilli Chao for the
Eastern parts of the country.
Characteristics of culture
Culture is invented
Culture is learned
Culture is socially shared
Cultures are similar but different
Culture is adaptive
Culture is organized and integrated
Its dealing with or comparing two or more cultures
Cross-culture tries to bring together such relatively
unrelated areas as cultural anthropology and
established areas of communication. Its core is to
establish and understand how people from different
cultures communicate with each other and the culture
of a society comprises the shared
values, understandings, assumptions, and goals that
are learned from earlier generations, imposed by the
members of the present day society and passed on to
the succeeding generations.
Cross culture values
Other oriented value
Environment oriented value
Basic area for cross culture Analysis
Different market segment opportunities
Difference in criteria for evaluating products and
Difference in consumption pattern and perceived
benefits of products and service
Upper class categories
A group consist of people who have a sense of relatedness
as a result of interacting with each other .
An assemblage of persons or objects gathered or located
together; an aggregation: a group of dinner guests; a group
of buildings near the road.
Two or more figures that make up a unit or design, as in
A number of individuals or things considered together
because of similarities: a small group of supporters across
Characteristics of group
More than one person
Sufficient interaction between member
Perception of themselves as a group
Allocation of certain roles to the members
Social relationship between member
Consumer relevant group
A group of people who are related to each other
A person's children
A group of related people including people who lived
in the past
Two are more person related by blood , marriage etc
Characteristics of family
Reference groups are used in order to evaluate
and determine the nature of a given individual or other
group's characteristics and sociological attributes. It is
the group to which the individual relates or aspires to
relate himself or herself psychologically. It becomes
the individual's frame of reference and source for
ordering his or her
experiences, perceptions, cognition, and ideas of self.
It is important for determining a person's self-
identity, attitudes, and social ties. It becomes the basis
of reference in making comparisons or contrasts and
in evaluating one's appearance and performance.
Communication is the process by which information is
transmitted between individuals or organization so that an
understanding response results.
It is an important tool in the hand of marketing used by them to
create a customer.
Communication can be defined as transmission of information
and messages to consumer via the media of personal
contact, mail, print tele/electronic means and broadcast
The various Features of Communication
Communication is Unavoidable
Role of Perception
How Communication Influence on
Brand Switching: Some promotions encourage consumers to buy a different
brand than the one they bought on an earlier purchase occasion, or had the
intention of buying now.
Repeat Buying: Repeat purchase may result because of habit formation that
may develop because the brand is bought more than once due to sales
Purchasing more or Accelerating Timing of Purchase: Purchasing more and
accelerating (hurry) timing refers to those situations when consumers buy
more than their immediate requirement or shift their purchase timing as a
result of promotions.
Increasing Category Expansion and Consumption: Sales promotions are likely
to stimulate demand by creating new occasions for purchase, or by increasing
the consumption rate by consumers.
How to Design an Effective Communication