Consumer Behaviour

Key to building customer

relationships

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Remember
Me?
I'm the fellow who goes into a restaurant, sits down and
patiently waits while the waitresses do everything but
take my order. I'm the fellow who goes into a
department store and stands quietly while the sales
clerks finish their little chitchat. I'm the man who drives
into a gasoline station and never blows his horn, but
waits patiently while the attendant finishes reading his
comic book.
"Yes, you might say, I'm a good guy. But do you know who
else I am? I am the fellow who never comes back, and
it amuses me to see you spending thousands of dollars
every year to get me back into your store, when I was
there in the first place, and all you had to do to keep
me was to give me a little service; show me a little
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courtesy."

Consumers Impact on Marketing

Strategy
Understanding consumer behavior is good
business.
Firms exist to satisfy consumers needs, so
Firms must understand consumers needs to
satisfy them.

The Process of Marketing Segmentation:

Identifies Groups of Consumers Who are Similar
to One Another in One or More Ways, and
Devises Marketing Strategies that Appeal to
One or More of These Groups.

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Consumers Impact On Marketing

Strategy:
Building Bonds With Consumers
Relationship Marketing occurs when a company
makes an effort to interact with customers on a
regular basis, and gives them reasons to
maintain a bond with the company over time.
Database Marketing involves tracking
consumers buying habits very closely, and
crafting products and messages tailored
precisely to peoples wants and needs based on
this information.

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Direct Marketing Tools

Client; 4
Customer; 3

5. 1 to 1 world

4. Loyalty Mktg

Strategic Value

Prospect; 2
Suspect; 1

3. Database Mktg

2.Direct Mktg, or
Response mech.
in mass media

1. Response
Advtg.

Time
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Advocate; 5
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Customer Value, Satisfaction, Trust and

Retention
Successful Relationships
Customer
value
Cost vs
Benefit..
As the
Customer
PERCEIVES
IT

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High level
of
customer
satisfaction
Performance
vs
Expectations
:
PERCEIVED
PERFORMAC
E

Strong
sense of
customer
trust
Establishing
&
Maintaining
Trust Key
to Long term
relationships

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Customer
retention
65% of Sales
come from
Loyal
Customers
Buy More
Less Price
Sensitive
Servicing is
Cheaper
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Consumer Behaviour
Study of How and Why consumers buy, consume
and dispose products and services
How consumers behave, What do they do?
Sequence of Behaviours / Activities a Buying Process

Why consumers behave they way they do

Mental and emotional processes
Personal / Internal
Demographics, Motivations, Beliefs, Attitudes, Perceptions,
Personality & Self image.

External influencers:
culture, groups, family
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How and Why?

HOW (they buy) helps us determine
Where we target our efforts
Why (they buy/ behave the way they
do) helps us determine HOW we will
segment, target and communicate
with them

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How Before Why ?

Traditionally, marketing thinking has
been even today:
1st : Segment the market
Then: Find out how & why of each
segment

Example:
Is this correct?

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Study How Before Why

Mapping this Buying Process (sequence of
behaviours) enables us to target changing ONLY
those behaviours which maximise our results
Hence, subsequent study of Why can be restricted
to these few, important selected behaviours.

Underlying attitudes, beliefs

Difficult to determine; Consumers often articulate
what is socially acceptable, enhances my self
image
Past behaviour is a good predictor of future behaviour
observable and measureable; Infer underlying
attitudes from observed behaviours.
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Two Consumer Entities

Personal
Consumer
The individual
who buys goods
and services for
his or her own
use, for
household use,
for the use of a
family member,
or for a friend.

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Organizational
Consumer
A business,
government
agency, or other
institution (profit
or nonprofit) that
buys the goods,
services, and/or
equipment
necessary for the
organization to
function.

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Consumer and avatars

Marketing as a science evolved through Consumer
Products, where Consumer also Buys and Pays
Consumer: one who Consumes
Customer one who buys and pays
Chooser and payor also can be split

Example
User: Nurse (Consumer) Not concerned about Price
Chooser Buyer: Nursing superintendent / HOD:
Payor: Procurement department of Hospital ???
patient ??

Influencer marketing
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Consumer and avatars

Other Examples??
Army (rifles), Hotels (Detergent for Laundry)
Mostly - institutional customers / B2B

Examples of similar splits in consumer

products?
Products for kids (users)

Paints:
Family Payor / buyor;
User? Painter Physical use of Paint;
Family/woman user of the effect of paint
Influencer: Interior decorator, magazines, friends
house
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