Consumer Behaviour

Prof Javed

Consumer Behaviour is the study of how individuals make decisions to spend their available resources(time,money,effort) on consumption related items.

What they buy? How they use and dispose the products?

When they buy? Why they buy? Where they buy,How often?

Cultural factorsSocial factorsPersonal factorsPsychological factors

Individual buying pattern is affected by his culture

Subculture has more specific identification

Culture affects buying behaviourEggless cakes for Jains ,Alcohol free

products offered to Gulf countries. Purchase of gold on Padwa – Indian

cultureMarathi Ads are aired to cater to the vast

majority of people in the state French –particular about their language

Family ,friends, formal social groups, colleagues, consumer action groups influence the consumer buying behavior significantly.

Family : Family of orientation –one’s parents and siblings

Family of Procreation-spouse and children

Newly wed couples buy honeymoon packages

Husbands have started taking keen interest in housekeeping , cooking due to rising proportion of working women

Reference groups They have a direct /indirect influence on a

person’s behavior Primary reference groups 1.Membership Group: Members of

Swadeshi /Gandhigiri club 2.Aspirational group-whom one aspires

to join ! 3.Disclaimant group- Being a member

dislikes the values 4.Avoidance /dissociative group- not a

member and dislikes their attitudes & behaviour

Secondary reference groupsOpinion leaders –special

skills ,knowledge , personality Identify media read /tuned to by

opinion leadersE.g: kitchenware –Housewife is

the best opinion leader

Age Easy to digest and eat –old ageLow fat low calorie –health conscious

adultsSweet meat –young adolescentsStage in lifecycleDivorce, remarriage , widowhood …

life circumstances have an effect on consumer behavior.

Occupation and financial status Blue collared worker –Lunch box,

work clothes, work shoes. White collared executives –laptop,travel,adventure

Personality , self concept, Lifestyle affect buying behavior e.g. Choice of apparel ,Real estate, home appliances, automobiles

Personality –psychological characteristics that give enduring & consistent responses to the environment

Motivation : Why one buys and when?Perception : interpret information to

create meaningful picture of the world. Understanding Customer’s perception would help marketers creating a proper image around the brand (Positioning)

Beliefs and attitudes Learning – test rides , free samples are

aimed at changing attitudes towards the product

Initiator – gives the idea of purchasing the product

Influencer- advices and influences the purchase decision

Decider – a person who decides – where ,when , how to buy a product

Buyer – actually purchases the product User – final beneficiary who uses the

product Maintainer- repairs /services the product Disposer – a person who disposes the

product

Extensive problem solving buying behavior

Expensive and infrequently purchased products

Consumers collect a lot of data High involvement product Marketers must differentiate their brand to

stay ahead of competition Marketers must help customers know

the brand E.G : Washing machine, music system,

automobiles

Routine buying behavior.

Routine purchasesLow involvement products – Salt In case the customer reaches for the

same brand, it is due to habit and not brand loyalty necessarily

Variety Seeking behaviorNeed for variety is felt by the

consumerBrand switching for variety than

satisfaction reasonsE.g: Cookies

Impulse buying behavior On the spot decision Instantaneous purchaseMarketers lure customers through

free gifts ,discounts. In store displays-danglers, banners,

cut outs…Point of purchase communication

Sensory Branding

Problem /need recognition

Information search

Evaluation of alternatives

Purchase decision

Post purchase behavior

A person recognizes a need or a problem

Internal stimuli – Hunger External stimuli-AdsMarketers need to identify stimuli

that trigger needs

Two levels of arousal 1.Heightened attention : more receptive

to information about the product2.Active information search – calls up

friends ,visit stores. Sources of Consumer Information Personal sources-

family ,friends ,neighbors Commercial sources- dealers, sales

persons. Ads, displays Experiential sources- handling the

product ,free samples /test rides. Public sources – media, Testing labs.

Awareness set –total set of brands Contender set – applies criteria like

budget, preferences.Choice set – strong contenders form

which he /she will purchase

Consumers seek bundle of benefits E.g : while buying a camera –

picture ,focus ,size and speed Customers develop brand beliefs on

every attribute of the brand. Customers believe that Olympus camera has better focus ,pocket friendly (Denim pockets)

These set of beliefs enable consumers to develop ‘Brand image ‘

Factors affecting purchase decision Attitude of others-Purchase

intention adjustment Unanticipated situational factors

–health , job , death of spouse.Perceived risk – money ,self

confidence , Attribute uncertainty Decisions – Brand –vendor-

quantity-timing-payment

Concept of satisfaction /delight Cognitive dissonance – when he does

not get all the benefits he was looking for or competitor’s brand offers his sought benefits

Reinforce: ‘ yehi hai right choice baby’ Educate the consumer for proper usage –

Washing machines for making lassi in Punjab

Disposal – no harm to the environment-Kodak , HP empty cartridges, Samsung –damaged mobile handsets

Professionally and technically qualified buyers

0 or 1 level channelPerformance ,reliability , durability Packaging is more protective than

being promotional Impulse buying is rare Multiple buying influencesNegotiations/tenders and bidding

Straight rebuy–regular and routine purchases like consumables , tools, spares.

Modified rebuy –specifications of products to be purchased change, need to look out for new suppliers along with the existing suppliers .

New task buying-completely new products

Process of Buying

Demographic – o Industry – which industry should

we focus on?o Company size – what size

companies should we focus on?o Location – what geographical areas

should we focus on?

b. Operating variables – Technology – what customer technology should we focus on?

o Usage status – Should we focus on heavy, medium, light users or nonusers?

o Customer capabilities – Should we focus on customers needing many or few services?

c. Purchasing approaches – Highly centralized or decentralized purchasing organization

o Engineering dominated, financially dominated.

o Strong relationships or go after most desirable companies. Leasing, service contracts, system purchase, sealed bidding –

o Companies seeking qualities, service, price – purchasing criteria

d. Situational factors – o Urgency – needing quick & sudden

delivery or service.o Specific application – certain

application or all application.o Size of order – large or small orders

e. Personal characteristics – o Buyer sellers similarity – companies

whose people & values are similar to ours.

o Attitude towards risk – risk taking or risk avoiding companies.

o Loyalty – companies that show high loyalty to their suppliers.