Consumer behavior involves the study of individuals' decision-making processes when purchasing goods and services, influenced by psychological, social, and cultural factors. It is dynamic, multifaceted, and crucial for developing effective marketing strategies, product innovation, and enhancing customer experiences. Market segmentation, targeting strategies, and understanding the buyer decision process are key components in effectively addressing consumer needs.

1. Unit 2
DR. Nidhi Raj Gupta

2. Consumer Behaviour
Consumer behaviour refers to the study of
individuals' decision-making processes and
behaviours when purchasing, using, or disposing
of goods and services.
It involves understanding the psychological,
social, and cultural factors influencing these
decisions.

3. Nature
• Multidimensional Aspect: Consumer behavior is a complex, multifaceted
phenomenon combining elements of psychology, sociology, anthropology, and
economics. It encompasses a wide range of factors, from individual mental
processes to broader cultural and social norms.
• Dynamic Nature: Consumer preferences and behaviors are not static; they evolve
over time due to various factors such as technological advancements, social
trends, economic changes, and personal experiences.
• Variability: Different consumers have unique needs, perceptions, and behaviors.
Even the same consumer may exhibit different behaviors in different situations.
• Influenced by Various Factors: Consumer behavior is influenced by internal factors
like beliefs, attitudes, and motivation, as well as external factors like family,
culture, and social groups.
• Decision-Making Process: It involves a series of steps that consumers go through,
including problem recognition, information search, evaluation of alternatives,
purchase decision, and post-purchase behavior.
• Goal-Oriented: Consumers engage in buying behavior to satisfy specific needs and
desires, which can range from basic physiological needs to complex psychological
motivations.

4. Importance
• Marketing Strategy Development: Understanding consumer behavior is crucial for
marketers to design and implement effective marketing strategies. It helps in segmenting the
market, targeting the right audience, and positioning products/services accordingly.
• Product Development and Innovation: Insights into consumer behavior guide businesses in
developing products that meet the evolving needs and preferences of consumers, leading to
innovation and improved product offerings.
• Enhancing Customer Experience: By understanding the needs and behaviors of consumers,
companies can enhance customer experiences, leading to increased customer satisfaction
and loyalty.
• Effective Communication: Knowledge of consumer behavior aids in crafting appropriate
communication strategies that resonate with the target audience, thereby increasing the
effectiveness of advertising and promotional activities.
• Competitive Advantage: Businesses that thoroughly understand and anticipate the behavior
of their consumers are more likely to gain a competitive edge in the marketplace.
• Risk Reduction: By predicting consumer responses and trends, companies can reduce the risk
associated with new product launches or market entry.
• Societal Impact: Understanding consumer behavior also has societal implications, as it can
help in promoting sustainable consumption patterns and influencing public policy for
consumer welfare.

5. Consumer Buying Behavior
Consumer Buying Behavior refers to the
BUYING BEHAVIOR of
final consumers (individuals & households)
who buy goods and services
For
Personal Consumption.

8. Problem

10. Types Of Problem
Routine Problem

11. Emergency Problem

12. Planning Problem

13. Evolving Problem

14. Activating Problem Recognition
Desired State
Actual State

16. Actual State

18. Information Search

19. The Buyer Decision Process
Step 2. Information Search
•Family, friends, neighbors
•Most influential source of
information
•Advertising, salespeople
•Receives most information
from these sources
•Mass Media
•Consumer-rating groups
•Handling the product
•Examining the product
•Using the product
Personal Sources
Commercial Sources
Public Sources
Experiential Sources

20. Alternate
Evaluation

21. The Buyer Decision Process
Step 3. Evaluation of Alternatives
Product Attributes
Evaluation of Quality, Price, & Features
Degree of Importance
Which attributes matter most to me?
Brand Beliefs
What do I believe about each available brand?
Total Product Satisfaction
Based on what I’m looking for, how satisfied
would I be with each product?
Evaluation Procedures
Choosing a product (and brand) based on one
or more attributes.

22. The Buyer Decision Process
Step 4. Purchase Decision
Purchase Intention
Desire to buy the most preferred brand
Purchase Decision
Attitudes
of others
Unexpected
situational
factors

23. The Buyer Decision Process
Step 5. Post Purchase Behavior
Consumer’s Expectations of
Product’s Performance
Dissatisfied
Customer
Satisfied
Customer!
Product’s Perceived
Performance
Cognitive Dissonance

24. Market Segmentation

25. Meaning
Market
Segmentation is the
sub-dividing of market
into homogeneous
subsets of customers,
where any subset may
conceivably be selected
as a market target to
be reached with a
distinct marketing
mix.” – Philip Kotler

26. Need &
Requisite
• Identify
Opportunities
• Optimize
Resources
• Minimize Risk
• Enhance
Customer
Satisfaction

27. Levels Of Market Segmentation

28. Local Marketing

29. Niche Marketing

30. Individual Marketing

33. Segmentation

34. HLL VS NIRMA

37. Bases for Segmentation (Consumer Goods)

38. Geographical

39. Demographical
Age
Income
Gender
Occupation
Education
Marital Status
Family Size & Structure

43. Psychographic

44. Meaning
Psychographic segmentation is a method used to
divide a market or customer group into segments
based on :
• Beliefs,
• Values,
• Lifestyle,
• Social Status,
• Activities, Interests

45. Psychographic
Personality Life Style

47. Behavioral
• Occasions
• Benefits
• User Status: nonuser, ex user,
Potential user, first time user,
regular user
• Usage Rate: light, medium, heavy
• Loyalty : Hard core, Split,
Shifting, Switchers
• Buyer readiness Stage: aware,
unaware, interested
• Attitude: Enthusiastic, Positive,
indifferent, Negative and hostile

48. Occasion

49. Benefit

50. Benefit

51. Benefit

52. Benefit

53. Benefit

54. Attitude

61. Target Meaning

62. Target

63. Targeting Strategies
• Standardization: Coke, Pepsi
• Differentiation: Economy
Class/ Business class
• Focus: Standardization +
Differentiation

64. Focus

65. Positioning
It Is A Marketing Strategy Focused
On Distinguishing A Brand From Its
Competitors.

66. Positioning

67. Positioning Types
Attribute/Benefit/ Value Differentiation
Competitive

68. POP & POD