Definition of consumer Behaviour Nature and scope of Consumer Behaviour Types of Consumer Behaviour Development concepts Market Segmentations

1. P.Venkata Subbaiah,
MBA,(Ph.D.)
AITS (Autonomous),Rajampet
CONSUMER BEHAVIOUR
Introduction and overview to study of Consumer Behaviour
Nature & Significance Of Consumer Behaviour
Dimensions of Consumer Behavior
Development concept of Consumer Behaviour
Marketing Segmentation

2.  Consumer behaviour has emerged in the 1940s and 50s as a distinct sub-discipline
of Marketing
 “Consumer behavior is the process where by individual decides what, where, when,
how, from whom to purchase the goods and services.” --- Walter
 According to Engel, Blackwell, and Mansard, ‘consumer behaviour is the actions and
decision processes of people who purchase goods and services for personal
consumption’.
Differences among below terms
 Customer
 Consumer
 Client
 End-User
 Buyer

3. Consumers can be divided into two types –
Household consumers – Who buy products for their own consumption.
Industrial consumers – Who buy products for further value addition, as inputs for manufacturing or for retailing.

4. Consumer behaviour is the study of individuals, groups, or
organizations and all the activities associated with the purchase, use
and disposal of goods and services, and how the consumer's
emotions, attitudes and preferences affect buying behaviour.
Purchase activities: The purchase of goods or services; how consumers acquire
products and services.
Use or consumption activities: Concerns the who, where, when and how of
consumption and the usage experience.
Disposal activities: Concerns the way that consumers dispose of products and
packaging; may also include reselling activities such as eBay and second-hand
markets

5.  The study of Consumer Behavior helps in understanding how individuals make
decisions to spend their available resources like time, money, and effort while
purchasing goods and services.
 It is a subject that explains the basic questions that a normal consumer faces −
what to buy, why to buy, when to buy, where to buy from, how often to buy, and
how they use it.

6. Types of consumer behavior
There are four main types of consumer behavior:
1. Complex buying behavior
2. Dissonance-reducing buying behavior
3. Habitual buying behavior
4. Variety seeking behavior

7. Dimensions of Consumer Behavior
Consumer behavior is multidimensional in nature and it is influenced by the following
subjects −
Psychology is a discipline that deals with the study of mind and behavior.
Sociology is the study of groups.
Social Psychology is a combination of sociology and psychology
Cultural Anthropology is the study of human beings in society.

8. What it reveal ?
 What consumers think and how they feel about various alternatives
(brands, products, etc.);
 What influences consumers to choose between various options;
 Consumers’ behavior while researching and shopping;
 How consumers’ environment (friends, family, media, etc.) influences
their behavior.

9. Nature of Consumer Behaviour
1. Influenced by various factors
2. Undergoes a constant change
3. Varies from consumer to consumer
4. Varies from region to region and country to county
5. Information on consumer behaviour is important to the marketers:
Product design/model
Pricing of the product
Promotion of the product
Packaging
Place of distribution
6. Leads to purchase decision
7. Varies from product to product
8. Improves standard of living

10. Significance of Studying Consumer Behaviour
(i) Realistic Implementation of the Marketing Concept:
• The modern marketing concept is consumer-oriented.
• To give a realistic implementation to this concept, a study of consumer
behavior is imperative.
• More specifically, a study of consumer behavior is a must for developing an
ideal marketing-mix; which is the cornerstone of the concept of marketing.
• It is, in fact, very true to state that unless the marketer knows what
consumers buy and why; it is not possible to design and implement a
successful scheme of marketing-mix to, beat the completive elements.

11. (ii) Planning Product Differentiation and Market Segmentation:
For planning product differentiation strategies (i.e. making the product so
differentiated and unique that consumer may be tempted to buy only that
product due to its unique features); a study of consumer behaviour is very
significant or necessary.
Again, for designing schemes of market segmentation (a process of dividing
a potential market into distinct sub-markets of consumers with common
needs and characteristics), a study of consumer behaviour is very
necessary.

12. (iii) Selection of Distribution Channels:
A study of consumer behaviour not only includes what consumers buy;
but also the source from where they buy’.
For example, men of status in society may never buy things from
ordinary shops and ordinary markets. They may prefer to buy from
prestigious stores and markets; even though they may have to pay a
higher price and so on for various categories of consumers.

13. (iv) Designing Promotional Techniques:
Promotional techniques include advertising message and media,
personal selling approaches and special sales promotional devices.
Designing promotional techniques is much facilitated by a study of
consumer behaviour; which may throw light on the psychology of
people as to the factors which affect their buying decisions.

14. (v) Trade-Off between Price and Quality:
A study of consumer behaviour is likely to reveal whether target
consumers of the enterprise emphasize more on the price of the
product or its quality.
On this basis, the marketer can device suitable pricing strategies and
programmes aimed at upgrading the quality of organization's
products to suit the needs, habits and behaviour of consumers.

15. Development Of The Marketing Concept And
The Discipline Of Consumer Behaviour:
• The field of consumer behaviour is rooted in the marketing concept, a business
orientation that evolved in the 1950s through several alternative approaches toward
doing business referred to respectively: -
1) The Production Concept.
2) The Product Concept.
3) The Selling Concept.
4) The Marketing Concept.
5) The Societal Marketing Concept

16. 1) THE PRODUCTION CONCEPT:
• The production concept assumes that consumers are mostly
interested in product availability at low prices; its implicit marketing
objectives are cheap, efficient product and intensive distribution.
• It makes sense when consumer are more interested in buying what’s
available rather than wait for what they really want.
• The main objective is to expand the market.

17. 2) THE PRODUCT CONCEPT:
• The product concept assumes that consumers will buy the product that
offers them the highest quality, the best performance, and the most
features.
• It ensures the company to improve the quality of its product and add new
features.
• The product concept often leads to “marketing myopia” that is focusing on
the product rather than the customer needs.

18. 3) THE SELLING CONCEPT:
• The assumption of the selling concept is that consumers are unlikely to buy
the product unless they are aggressively persuaded to do so – mostly
through “hard sell” approach.
• The problem in this concept is that it fails to satisfy a customer.
• Today the selling concept is utilize be marketers of unsought products –
that is which people are not willing to buy it (such as life insurance).

19. 4) THE MARKETING CONCEPT:
• It started in 1950’s when some marketers realized we can sell more
products by determining what consumer would buy.
• Consumer need and wants became the firm’s primary focus.
• The marketers should made product what t can sell, instead of what it
has made.

20. STARTING POINT FOCUS MEANS ENDS
SELLING CONCEPT
Factory  Product  Selling & Promotion  Profit through sale volume
MARKETING CONCEPT
Market  Needs  Marketing  Profit via customer satisfaction

21. 5) THE SOCIETAL MARKETING CONCEPT:

22. IMPLEMENTING THE MARKETING CONCEPT:
• To identify unsatisfied consumer need, companies had to engage in
extensive marketing research. The marketing concept underscored
the importance of consumer research.
• The strategic tools that are used to implement the marketing concept
include segmentation, targeting, positioning and the marketing mix.

23. • Analyzing market opportunity:
• Selecting target market:
• Marketing-mix decisions:
• Use in social and non-profits marketing
Strategic Applications of Consumer Behaviour

24. Market Segmentation
 Market segmentation is the process of dividing a market of potential customers into groups, or
segments, based on different characteristics.
 The segments created are composed of consumers who will respond similarly to marketing
strategies and who share traits such as similar interests, needs, or locations.

25. SEGMENTATION OF MARKET – CONSUMER BEHAVIOUR