Consumer Behavior

Know the consumer

• Why do the consumers buy your product / Service?

• Why do these consumer buy your brand / service not the competitor's brand ?

• How do consumer perceive brand of your product / service, which fulfills their need. ?

• Are they satisfy or dissatisfy with your product / Service ?

• How are these feelings reflected in their buying behavior ?

Nature of Consumer Behavior

• Consumer Behavior can be Defines as….

“ The Decision process and physical activity engaged in evaluating, accruing, using or disposing of goods and services”

Nature of Consumer Behavior

• The Definition raises a few questions in our mind……….

– What or who are our consumers.– What is the decision process they are engaged

in.

Who is a Consumer

Approach 1:- Anyone who is Buying any good or services where money transition is involved

Approach 2:- Anyone actually purchase a product or services from a particular company or shop.

Consumer v/s Costumer

• There is a situations where distinction between consumer and costumer occurs

– When customer is not the actual user of the product / service or is the only one of the many user.

The Definition

“ Any person who is physically engaged in an activity of evaluation, accruing, using or disposing of goods and services”

The Rules of Consumer Behavior

• Initiator :- Any person who determines that some need or want is not being met.

• Influencer :- The person who intentionally / unintentionally influence the decision to buy or the actual purchase and or use of product or services.

• Buyer :- the person who actually makes the purchase.

• User :- The person who actually uses or consume the product o service.

Buying Process (Consumer Behavior)

Internal Environment

• Motivation and Involvement

• Attitude

• Personality and Self-Concept

• Learning and Memory

• Information Processing

• Motivation and Involvement– Type of motivation

1. Physiological2. Psychological

• Attitudes– Our learned predisposition towardsobjects, people and events

• Personality and Self-concept– Personality is the sum total of the unique

individual characteristics that make each one of us what we are.

Learning and Memory

• Information Processing

External Environment

• Cultural Influence• Sub-Cultural influence• Social Class Influence• Social Group Influence• Family Influence• Personal Influence• Other Influence

Cultural Influence“The set of basic values, perception, wants and behavior of society from

family and other important institution”

Sub-Cultural influence“A group of people with shared value system based on common life

experience and situation”

Social Class Influence“Relatively permanent and ordered division in a society whose

members share similar value, interest and behavior”

Social Group Influence“Two or more people who interact to accomplish individual or mutual

goals”

Family Influence

Personal Influence

Other Influence

Customer expectations of service

• Types of expectations customers hold for service performance

• Sources of customer expectations

Possible Levels of Customer Expectation

Consumer Expectations of Services

Consumer Expectations

• Pre-trial beliefs about a service that function as standards against which performance is judged.

Types of Expectations

• Desired service -- the level of service the customer hopes to receive

• Adequate service -- the level of service the customer will accept

Dual Customer Dual Customer Expectation LevelsExpectation Levels

Adequate Service

Desired Service

Zone ofTolerance

Adequate Service

Desired Service

Zone ofTolerance

The Zone of ToleranceThe Zone of Tolerance---The extent to which customers recognize and are willing to

accept variation in service performance

Service Components

Zones of Tolerance forZones of Tolerance forDifferent Service DimensionsDifferent Service Dimensions

Most Important Factors Least Important Factors

Level of

Expectation

Adequate Service

Desired Service

Zone ofTolerance

DesiredService

AdequateService

Zone of

Tolerance

Desired Service

Adequate Service

Zone of Tolerance and Importance of Service Dimensions

• As a service dimension becomes more important zone of tolerance will narrow and desired and adequate levels will increase

Factors that InfluenceFactors that InfluenceDesired ServiceDesired Service

DesiredService

AdequateService

Zone of

Tolerance

Enduring ServiceIntensifiers

Personal Needs

Factors that InfluenceFactors that InfluenceDesired ServiceDesired Service

• Personal Needs --- states or conditions essential to the physical or psychological well being --- physical, social, psychological, and functional

Factors that InfluenceFactors that InfluenceDesired ServiceDesired Service

• Enduring Service intensifiers --- individual stable factors that lead the customer to a heightened sensitivity– derived service expectations– personal service philosophy

Derived service expectations

Personal service philosophy

Factors that InfluenceFactors that InfluenceAdequate ServiceAdequate Service

DesiredService

AdequateService

Zone of

ToleranceSelf-PerceivedService Role

Situational Factors

Perceived ServiceAlternatives

Transitory ServiceIntensifiers

Factors That Influence Adequate Service Expectations

• Are short-term in nature and fluctuate more than the factors that influence desired expectations

Factors That Influence Adequate Service Expectations

• Transitory (Temporary) service intensifiers --- short-term, individual factors that make a consumer more aware of the need of service

Factors That Influence Adequate Service Expectations

• Perceived Service Alternatives----• As the number of alternatives increases, the level

of adequate service increases and the zone of tolerance narrows

Factors That Influence Adequate Service Expectations

• Situational Factors – Temporary changes in the normal state of

things ---- tends to lower the level of adequate service expected and widen the zone of tolerance

– Reason for purchase– Consumer mood– Weather– Time constraints– Emergency

Reason for purchase

Consumer mood

Weather

Time constraints

Emergency

Factors That Influence Adequate Service Expectations

• Self Perceived Service Role --- how well the customer perceives they are performing their own role in service delivery

Factors that InfluenceFactors that InfluencePredicted ServicePredicted Service

DesiredService

AdequateService

Zone of

Tolerance

Predicted Service

Explicit ServicePromises

Implicit ServicePromises

Word-of-Mouth

Past Experience

Factors that InfluenceFactors that InfluenceDesired and Predicted ServiceDesired and Predicted Service

• Explicit Service Promises• Implicit Service Promises• Word of Mouth • Past Experience

– particular service– within the same industry– related services

•More experience the narrower the Zone of Tolerance

Explicit Service Promises

Implicit Service Promises

Word of Mouth

Past Experienceparticular service, within the same industry, related servicesMore experience the narrower the Zone of Tolerance

Past Experienceparticular service, within the same industry, related services

Factors Influencing Customer Satisfaction

•Product/service quality•Specific product or service features•Consumer emotions•Attributions for service success or failure

Product / service quality

Specific product or service features

Consumer emotions

Acknowledgment of service

Factors Influencing Customer Satisfaction

• Perceptions of equity or fairness• Other consumers, family members, and

coworkers• Price• Personal factors

– the customer’s mood or emotional state– situational factors

Perceptions of equity or fairness

Other consumers, family members, and coworkers

Price

Personal factorsthe customer’s mood or emotional state situational factors

Evidence of Service from theCustomer’s Point of View

People

Process PhysicalEvidence

Employees Contact Customer him/herself Other customers

Operational flow of activities

Steps in process

Flexibility vs. standard

Technology vs. human

Tangible communication

Servicescape

Guarantees

Technology

Website

(Process)Operational flow of activities / Steps in

process

(Process) Flexibility vs. standard

(Process) Flexibility vs. standard

(Process) Flexibility vs. standard

(Process) Technology vs. human

(People)Employees Contact

(People) Other customers

(Physical Evidence)

Tangible communication

(Physical Evidence) Guarantees

(Physical Evidence) Technology

(Physical Evidence) Website

Strategies For Influencing Customer Perceptions

• Enhance Customer Satisfaction through Service Encounters

• Reflect Evidence of Service

• Communicate and Create a Realistic Image

• Enhance Customer Perception of Quality and Value through Pricing

Enhance Customer Satisfaction through Service Encounters

Reflect Evidence of Service

Reflect Evidence of Service

Communicate and Create a Realistic Image

Communicate and Create a Realistic Image

Enhance Customer Perception of Quality and Value through Pricing

Enhance Customer Perception of Quality and Value through Pricing