Consumer Behaviour

Learning Objectives: Understand what motivates a customer to buy a product or service. Know the consumer decision making process Understand the factors that inf uence consumer decisions Know the too s used to study consumer decision making.

Consumer Behaviour
!efinition: Consumer buyer Behaviour "he buying behaviour of fina consumers# individua s and househo ds who buy goods and services for persona consumption. Consumer $arket: % the individua s and househo ds who buy or ac&uire goods and services for persona consumption.

Consumer Behaviour
%na ysis of buyer or customer behaviour can be done into two broad groups : * Consumer buyers are those who purchase items for their persona consumption *Industrial buyers are those who purchase items on beha f of their business or organisation

Consumer Behaviour
Businesses now spend considerab e sums trying to earn about what makes 'customers tick(. "he &uestions they try to understand are: ) *ho buys+ ) ,ow do they buy+ ) *hen do they buy+ ) *here do they buy+ ) *hy do they buy+

) ,ow do they buy+ : Buyer decision process

How does the customer obtain the information ?

) -ersona sources:
fami y. friends. neighbours etc

) Commercia sources:
advertising/ sa espeop e/ retai ers/ dea ers/ packaging/ point#of#sa e disp ays

) -ub ic sources:
newspapers. radio. te evision. consumer organisations/ specia ist maga0ines

) 12perientia sources:
hand ing. e2amining. using the product

How does the customer use the information obtained? purchases inc ude those invo ving high e2penditure or persona risk 3 for e2amp e buying a house. a car or making investments. Low involvement purchases 4e.g. buying a soft drink. choosing some breakfast cerea s in the supermarket5 have very simp e eva uation processes.
High-involvement

% ternative eva uation

"he

stage of the buyer decision process in which the consumer uses information to eva uate a ternative brands in the choice set.

-urchase decision
"he

buyer6s decision about which brand to purchase.

-urchase behaviour: "he stage of the buyer decision process in which the consumers take further action after purchase. based on their satisfaction or dissatisfaction.

-ost

Post-purchase evaluation - Cognitive Dissonance

uyer discomfort caused by post purchase conf lict! It is common for customers to e"perience concerns after ma#ing a purchase decision . "he customer. having bought a product. may fee that an a ternative wou d have been preferab e. 7n these circumstances that customer wi not repurchase immediate y. but is ike y to switch brands ne2t time.

8timu us 39esponse $ode

Buyers black box

:actors inf uencing consumer behaviour

Cu tura :actors
Cu ture:

"he set of basic va ues . perceptions . wants and behaviours earned by a member of society and other important institutions. 8ubcu ture : % group of peop e with shared va ue systems based on common ife e2periences and situations. 12: 7n 7ndian Cu ture we have ,indus . $us ims. Christians . 8ikhs as re igious subcu tures. 8ocia C ass: 9e ative y permanent and ordered divisions in a society whose members share simi ar va ues. interests and behaviour.

8ocia :actors
groups 7mp ies peers . re atives. neighbours and friends inf uences a man6s behaviour. Opinion Leader -erson within a reference group who because of specia ski s . know edge. persona ity or other characteristics . e2erts socia inf uence on others.
9eference

8ocia :actors
:ami y

7mportant buying organi0ation of society. $arketers shou d study ro es and inf uences of the husband . wife and chi dren on purchase of different products ; services. 9o es ; status % person be ongs to many groups# fami y. c ubs and organi0ations. % person6s ro e in each group is defined by both ro e and status. % ro e is set of activities a person need to perform in the different groups. 1ach ro e carries a status with it. 12: a working mother.

8ocia :actors
"he typica ro es in such a group decision can be summarised as fo ows: Initiator "he person who first suggests or thinks of the idea of buying a particu ar product or service Inf luencer % person whose view or advice inf uences the buying decision Decider "he individua with the power and<or financia authority to make the u timate choice regarding which product to buy uyer "he person who conc udes the transaction $ser "he person 4or persons5 who actua y uses the product or service

%ge ; :ami y Life cyc e 8tages in :LC: =. Bache or stage >. ?ew y married coup es @. :u nest = : coup e with chi d under Ayrs B. :u nest 77 : coup e with youngest chi d Ayrs or over. C. :u nest 777: o der married coup e with dependent chi dren A. 1mpty nest 7 : o der married coup e with no chi dren iving with them. ,ead of househo d in abour force. D. 1mpty nest 77 : o der married coup e with no chi dren iving with them. ,ead of househo d retired E. 8o itary survivor. in abour force F. 8o itary survivor. retired.

-ersona :actors

Lifesty e % persons pattern of iving as e2pressed in his or her activities . interests and opinions. %ctivities: work. hobbies. shopping. sports. socia events. 7nterest: food. fashion. recreations etc Opinion: about se f. socia issues. business. products ; services

-ersona :actors

-ersona ity: "he uni&ue psycho ogica characteristics that ead to re ative y consistent and asting responses to one6s own environment. -ersona ity is a trait described in terms of se f confidence. dominance. sociabi ity. autonomy. defensiveness. adaptabi ity etc. 8e f concept is the individua 6s own perceived image and actua image is based on how others perceive the individua .

-ersona :actors

Brand -ersona ity: "he specific mi2 of human traits that may be attributed to a particu ar brand. 9esearcher has identified C brand persona ity traits: =. 8incerity 4 honest. down#to#earth5 >. 12citement 4 daring. spirited5 @. Competence 4 re iab e. inte igent5 B. 8ophistication 4 upper c ass and charming5 C. 9uggedness4 rough ; tough5

-ersona :actors

Occupation 1conomic circumstances

-ersona :actors

-sycho ogica :actors

4 or drive5: % need that is sufficient y pressing to direct the person to seek satisfaction of need. -erception % process by which peop e se ect. organi0e and interpret information to form meaningfu picture of the wor d.
$otive

$as ow6s ,ierarchy of ?eeds

Self Actualization
(Self-development)

Esteem Needs (self-esteem, status) Social Needs

(sense of belonging, love)

Safety Needs
(security, protection)

Physiological Needs
(hunger, thirst)

-sycho ogica :actors

Learning:

Changes in an individua 6s behaviour arising from e2perience. Learning occurs through interp ay of: !rives: a strong interna stimu us that ca s for action. Cues 4 signa s5 : minor stimu i which determine when. where. and how a person responds. 9esponse 9einforcement

-sycho ogica :actors

Be iefs: % descriptive thought that a person has about something. Be iefs can be changed. %ttitude : % person6s re ative y consistent eva uations . fee ings and tendencies toward an object or idea. %ttitudes are difficu t to change.

1motions

$emory
8hort

term memory Long term memory

:igure C.@ ,ypothetica L7C $enta $ap

"he Buyer !ecision -rocess for ?ew -roducts

% new

product can be defined as: "A good, service or idea that is perceived by some potential customers as new. It may have been available for some time, but many potential customers have not yet adopted the product nor decided to become a regular user of the product"

"he Buyer !ecision -rocess for ?ew -roducts

Research suggests that customers go through f ive stages in the process of adopting a new product or service these are summarised below: !" Awareness # the customer becomes aware of the new product, but lac$s information about it %" Interest # the customer see$s information about the new product &" 'valuation # the customer considers whether trying the new product ma$es sense (" )rial # the customer tries the new product on a limited or small scale to assess the value of the product *" Adoption # the customer decides to ma$e full and+or regular use of the new product

"he Buyer !ecision -rocess for ?ew -roducts

"ypes of Buying !ecision Behaviour

High Involvement
Significance differences between the brand

Low Involvement

Complex Buying behaviour

Variety Seeking buying behaviour

Few differences between the brand

Dissonance reducing buying behaviour

Habitual buying behaviour