CONSUMER BEHAVIORIntroduction and OverviewLets cracks it and lets be at it

Consumer

Behavior

ShopperBuyer

CustomerUser

PurchaserEnd userClient

PerformanceActionsdeeds

activitiesmannersConduct

work

SO WHAT EXACTLY IS CONSUMER BEHAVIOR ?

What is consumer behavior ?

The Study of: How come, What When Why Where

People buy / consume / believe / communicate about a product / service / anything of value to organisation

Cont’d..

What they buy? Why they buy it? When they buy it? Where they buy it? How often they buy it? How often they evaluate it? How they evaluate it after the

purchase? The impact of such evaluations on

future purchases? How they dispose it?

Consumer Behavior – Definition “How individuals, groups, and organizations select,

buy, use, and dispose of goods, services, ideas, or experiences to satisfy their needs and desires.”

Consumer behavior from

Sale perspective (Before sale perspective)

Product usage perspective Word of mouth perspective / Other

Marketing perspective post sales After sales perspective Cross sell / repeat sale perspective

Consumer behavior elements of interest

Consumer Consumer market in terms of

Geography Target audience Demographics Consumption

Sellers Political factors and many more elemets

What is consumer market ?

Consumer market is all about the Place part of marketing

Market is one of many varieties of systems, institutions, procedures, social relations and infrastructures whereby parties engage in exchange… Where consumer’s buy product

Types of Market Form Scale : Geographical Types of participants Types of goods and services And many more..

Lets see how consumer market is imp..

Consumer Market

National level

Consumer market

Various other types of market which we are going to incorporate in our study / course Form type of market

Physical retail markets Non physical markets

Style of business Brokerage Intermediary market

Basis types of goods and services Financial markets Service industry Goods of all types like food, clothes, property, etc.

Consumer market

Various other types of market which we are going to incorporate in our study / course Form type of market

Physical retail markets Non physical markets

Style of business Brokerage Intermediary market

Basis types of goods and services Financial markets Service industry Goods of all types like food, clothes, property, etc.

WHY ARE WE LEARNING CONSUMER BEHAVIOR ?

Its simple ! Because we want,to encash products which consumer want

and not, products whichconsumer may, does not, or would

think about , etc .

To make selling easy and generate profits from consumer

Lets take a Marketing outlook About managing profitable customer

relationships Attracting new customers Retaining and growing current customers

CB impacts perceived Value

Your product can have demand if it is costly

Ur product can be costly and yet be considered lower value

Value perceived corresponds to consumer behavior

Product performance

Customers perceived performance

Performance meets expectation

Customer satisfaction is factor of product performance

This is dependent on consumer’s behavior

So marketing is..

Process of building profitable customer relationships by creating value for customers and capturing value in return

Hence the new model is..

Every phase has consumer behavior……

NEED TO STUDY ?

‘You cannot take the consumer for granted any more’

Therefore a sound understanding of consumer behaviour is essential for the long

run success of any marketing program

Why is this important?

Out of 11000 products launched by 77 companies, only 56% are present five years later – Kuczmaski & Associates

Only 8% of new product concepts offered by 112 leading companies reached the market. Out of this 83% failed to reach marketing objectives – Group EFO Ltd., Marketing News, Feb 1, 1993, Pg 2

Why Study Consumer Behavior?

To implement the Marketing Concept . . a plan to influence buyer – seller exchanges to meet organizational goals

To understand complex influences on consumption processes

To increase a manager’s confidence to predict consumer responses to their marketing strategy

To avoid “the Self-Reference Criterion”

Cultural factors

Culture

Sub - culture

Social Class

Motivation

Perception

Learning

Beliefs & attitudes

Psychological Factors

Initiator

Influencer

Decider

Buyer

User

Gatekeeper

INITIATOR first identifies the need to buy a particular product or service

INFLUENCER views influence the buying centre's buyers and deciders

DECIDER ultimately approves all or any part of the entire buying decision -- whether to buy, what to buy, how to buy, and where to buy;

BUYER holds the formal authority to select the supplier and to arrange terms of condition;

USER consumes or uses the product or service;

GATEKEEPER controls information or access or both, to decision makers and influencers.

Buying Roles

Buying Behavior

The decision process and acts

of people involved in buying

and using products.

Complex

Dissonance - Reducing

Habitual

Variety Seeking

The Wheel of Consumer Behavior

Issues During Stages in the Consumption Process

Psychological factor

motivation

Motivation

Driving force within individuals that impels them to action Motivation has been considered as emotion

in consumer behavior leading to some action

Marketers have to en-cash on this emotion by not going against it but adapting to it

Motivation is due to some issue and leads to some kind of gratification

Unfulfilled needs, wants and desires

Tension Behavior

Personality perception learning attitudes

Goal or need fulfillment

Drive

Tension reduction

Needs / wants / desires

Innate needs / primary needs – roti, kapda aur makaan

Acquired needs / secondary / psychological

More is coming in Maslows needs Could be positive or Negative as well

Psychological Needs

Safety Needs

Social Needs

Personal Need(Self Actualisation Esteem)

Goals

Product specific goals – associated with brand

Generic goals – no brand association Positive goal – towards – is one towards

which behavior is directed Negative goal – away - is one towards

which behavior is directed away

Product specific goal – associated with brand

Generic goal- No brand association

Positive goals

Negative goals

ATTITUDE

A learned predisposition to behave in a consistently favorable or unfavorable manner with respect to a given object

Learned deposition- state of mind regarding something; inclination: a disposition to gamble.

Functions of Attitudes

Utilitarian: Do the products provide some benefit or reward?

Value-expressive: Does the product say something about who I am or would like to be? Is it self-expressive.

Ego-defensive: Does the product protect my self-esteem Does it help overcome any self doubts

Knowledge function: does the product help me to organize the information – does the product meet the needs for order and structure

Tricomponent Attitude Model

COGNITIVE COMPONENT The knowledge and perceptions that are

required by a combination of direct experiences with the product and related information about the very product from various sources. This knowledge and resulting perceptions commonly take the from of belief. This belief ultimately culminates into attitude towards buying the product.

AFFECTIVE COMPONENT A consumer’s emotions or feeling about a particular product or brand constitutes the affective component of an attitude. These emotions or feeling with the product subsequently results into brand loyalty sometimes.

CONATIVE COMPONENT Conative component is concern with the likelihood or tendency that an individual will undertake a specific action or behave in a particular way with regard to the attitude object. Conative component is frequently treated as an expression to of the consumer’s intention to buy.

MULTI ATTRIBUTE ATTITUDE MODELS

Attitude models that examine the composition of consumer attitudes in terms of selected product attributes or beliefs.

Multiattribute attitude models portray consumers' attitudes with regard to an attitude object (e.g., a product, a service, a direct-mail Catalog, or a cause or an issue) as a function of consumers' perception and assessment of the key attributes or beliefs held with regard to the particular attitude object.

3 TYPES

Attitude Toward Object:The attitude-toward-object model is

especially suitable for measuring attitudes toward a product (or service) category or specific brands.

EXAMPLE:

Attitude Toward Behavior:The attitude-toward-behavior model is the

individual's attitude toward behaving or acting with respect to an object rather than the attitude toward the object itself. 

ADs

It’s important for marketers to know the individual’s attitude about the act of purchasing a BMW (attitude toward behavior) rather than to know about his attitude toward the car (attitude toward object). This seems logical for a consumer might have a positive attitude towards an expensive BMW but a negative attitude towards his prospects for purchasing the vehicle.

Theory-of-reasoned-action model

To put the definition into simple terms: a person's volitional (voluntary) behavior is predicted by his attitude toward that behavior and how he thinks other people would view them if they performed the behavior. A person's attitude, combined with subjective norms, forms his behavioral intention

Depends on Attitude, subjective Norms and Behavioral Intention

Theory-of-reasoned-action model

THE TRYING -TO -CONSUME MODEL

The theory of trying to consume is designed to account for the many cases in which the action or outcome is not certain but instead reflects the consumer's attempts to consume (i.e., purchase).

A classic example of trying ("got") to consume is attempting to diet and lose weight. 

Attitude-Toward-The-Ad Models:

As the model depicts, the consumer forms various feelings (affects) and judgments (cognitions) as the result of exposure

to an ad. A positive relationship between attitude toward the

advertisement and purchase intention for each of the advertised products; that is, if consumers "like" the ad, they are more likely to purchase the product.

The Marketer’s Challenge

Deep seated attitudes are internalised and become part of the person's value system

Attitudes are difficult to change because

they are so important to the individual