Unit - I

Introduction to Consumer
Behaviour
 Meaning
• Consumer behaviour focuses on how individuals make decisions
to spend their available resources (time, money, effort) on
consumption-related items that includes what they buy, why they
buy, when they buy it, where they buy it, how often they buy it,
how often they use it, how do they evaluate it after the purchase
and the impact of such evaluations on future purchases, and how
do they dispose of it.
 Definition

• The term Consumer Behaviour(CB) is defined as the

behaviour that consumers display in searching for,
purchasing, using, evaluating and disposing of products
and services that they expect will satisfy their needs. -
Leon G. Schiffman & Leslie Lazar Kanuk
 Kinds of Consuming Entities

• Personal Consumer
• Organizational Consumer
 Personal Consumer

• Buys goods and services for his or her personal use, or

for household consumption or for just one member of
the family or as a gift for a friend. The products are
bought for final use by individuals, who are referred to as
end users or ultimate consumers.
 Organizational Consumer

• Includes profit and non-profit businesses, government

agencies (local, state, national) and institutional (e.g.
schools, hospitals, and prisons), all of which buy
products, equipment, and services in order to run their
organizations.
 Significance of CB
• Production Policies •Price policies •Decision regarding channels
of distribution •Decision regarding sales promotion •Exploiting
marketing opportunities •Consumers do not always act or react
predictably •Consumer preferences are changing and becoming
highly diversified •Rapid introduction of new products
•Implementing the marketing concept
 Difference between Consumer and Customer
Basis of Comparison Customer Consumer
Meaning The purchaser of goods and The end user of the goods and
services is known as customer services is called as consumer
Resell A customer who can be a business No resale is happening
entity, who can purchase it for the
purpose of resale

Purchase of Goods Yes Not necessary

Purpose Resale or Consumption Consumption
Price Paid by the Customer May not be paid by the customer
Person Individual or Organization Individual, Group, Family of People
 Customer
• The term “customer” is used to refer to someone who regularly
purchases from a particular store or company.
• Customer can in turn resell the products and services to the
consumers. In other words, Customer is a person who uses the
product for selling purpose
• Customer purchases the product or service
• A customer is an individual or organization who purchases goods,
or sometimes just browses and doesn't buy
 Consumer
• •The term “consumer” refers to any one engaging in any of the activities
used in our definition of CB . These are the potential purchasers of products
and services offered for sale.
• •A consumer is an end user. A consumer acquires goods and services for
direct use or ownership. In other words, Consumer is the person who uses
the product for their personal consumption
• Consumer uses the product
• A consumer is anyone who uses the goods that have been
purchased, or uses any products or services that have
been generated within the economy
 Example

So, therefore if a man was to go to a shop and

purchase a bar of chocolate, and his wife was the
one to eat it, the man would be the customer (as he
bought the product) and his wife would be the
consumer (as she used the product).
 Nature and Characteristics of Indian
Consumers
• Young Demographics
• Aspirational consumer
• Value Consciousness
• Networked consumer
• Socially Conscious
• Brand Switchers
• Thinking beyond categories
• Religious Diversity
• Diversity in dress and food habits
• Working women
• Conservatives
• Rising purchasing power
 Factors Influencing Indian consumers
• Changing Demographics
• Smaller Households
• Increasing awareness
• Westernization
• Organized retail stores
• Celebrity influence
• Quality-oriented outlets
• Freebies
• Product colour, size, design and shape
• Changes in saving and investment patterns
 Need to Study Consumer Behaviour
• To satisfy need of customers
• Helps to understand consumer psychology
- Consumer psychology is based on his knowledge, attitude, intention and motive.
• Helps to understand consumer motives
• Helps to understand consumer choices
• Helps to understand consumer preferences
Factors Influencing Consumer Behaviour

• Internal Factors
• External Factors
 Internal Factors
• Perception
• Learning
• Attitude
• Motivation
• Personality
• Self Concept
• Psychographics
 External Factors
• Culture
• Subculture
• Cross Culture
• Social Class
• Family
• Reference Group
• Opinion Leaders