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Name : - Singh Rahul Rajendra Pushpa Roll no : - 80Subject : - Marketing and Human Resource
Management
Consumer Behaviour
Introduction
All of us are consumers. We consume things of daily
use; we also consume and buy these products
according to our needs, preferences and buying
power. These can be consumable goods, durable
goods, specialty goods or, industrial goods. What we
buy, how we buy, where and when we buy, in how
much quantity we buy depends on our perception,
self concept, social and cultural background and our
age and family cycle, our attitudes, beliefs values,
motivation, personality, social class and many other
factors that are both internal and external to us.
While buying, we also consider whether to buy or not
to buy and, from which source or seller to buy. In
some societies, there is a lot of affluence and, these
societies can afford to buy in greater quantities and at
shorter intervals. In poor societies, the consumer can
barely meet his barest needs. The marketer therefore
Name : - Singh Rahul Rajendra Pushpa Roll no : - 80Subject : - Marketing and Human Resource
Management
tries to understand the needs of different consumers
and having understood his different behaviours, which
require an in-depth study of their internal and
external environment, they formulate their plans for
marketing.
Management is the youngest of sciences and oldest of
arts and consumer behaviour in management is a
very young discipline. Various scholars and
academicians concentrated on it at a much later
stage. It was during the 1950s, that marketing
concept developed, and thus the need to study the
behaviour of consumers was recognized. Marketing
starts with the needs of the customer and ends with
his satisfaction. When everything revolves round the
customer, then the study of consumer behaviour
becomes a necessity. It starts with the buying of
goods. Goods can be bought individually, or in
groups. Goods can be bought under stress (to satisfy
an immediate need), for comfort and luxury in small
quantities or in bulk. For all this, exchange is
Name : - Singh Rahul Rajendra Pushpa Roll no : - 80Subject : - Marketing and Human Resource
Management
required. This exchange is usually between the seller
and the buyer. It can also be between consumers.
Consumer behaviour can be defined as the decision-
making process and physical activity involved in
acquiring, evaluating, using and disposing of goods
and services. This definition clearly brings out that it
is not just the buying of goods/services that receives
attention in consumer behaviour but the process
starts much before the goods have been acquired or
bought. A process of buying starts in the minds of the
consumer, which leads to the finding of alternatives
between products that can be acquired with their
relative advantages and disadvantages. This leads to
internal and external research. Then follows a process
of decision-making for purchase and using the goods,
and then the post purchase behaviour which is also
very important, because it gives a clue to the
marketers whether his product has been a success or
not.
Name : - Singh Rahul Rajendra Pushpa Roll no : - 80Subject : - Marketing and Human Resource
Management
Meaning / Concept of Consumer
Behaviour:-
The term consumer behaviour is defined as the
behaviour that consumer display in searching for
purchasing, using, evaluating and disposing of
product and services that they expect will satisfy their
needs. Consumer behaviour focuses on how
individuals make decisions to spend their available
resources (time, money, effort) on consumption
related items. This includes what they buy, why they
buy it, when they buy it, where they buy it, how often
they buy it, how often they use it, how they evaluate
it after the purchase and the impact of such
evaluation on future, and how they dispose of it.
In another words, consumer behaviour can be
define as the behaviour of individuals in regards to
acquiring, using, and disposing of products, services,
ideas or experiences. Consumer behaviour also
includes the acquisition and use of information. Thus,
communication with consumers and receiving
Name : - Singh Rahul Rajendra Pushpa Roll no : - 80Subject : - Marketing and Human Resource
Management
feedback for them is a crucial part of consumer
behaviour, which is of great interest to marketers.
Definition of Consumer Behaviour:-
We define consumer behaviour as the mental and
physical activities undertaken by consumers to
acquire and consumer products to fulfill their needs
and wants. Our definition of consumer behaviour has
several elements worth noting. Let us discuss these
one by one.
Mental and Physical Activities
First, consumer behaviour includes both mental and
physical activities. Mental activities are acts of the
mind, and they relate to what we think, feel, and
know about products. Physical activities are, in
contrast, acts of the human body, and they relate to
what we physically do to acquire and consume
products.
Name : - Singh Rahul Rajendra Pushpa Roll no : - 80Subject : - Marketing and Human Resource
Management
Features/Nature of consumer
behaviour:-
(1) Consumer behaviour involves individual aspect as
well as social aspect. It is generally a purposive,
decision-making process.
(2) It is reflected through satisfaction or
dissatisfaction on the part of consumers after
actual purchase of product.
(3) Consumer behaviour is the result of interaction of
consumer with the environmental forces. The
buyer behaviour is influenced by the buyer’s
environment.
(4) Consumer behaviour is the net result of various
external/environmental factors. Such factors are
mainly social and psychological in character.
(5) Consumer behaviour includes behaviour of
consumers/buyers of consumer goods, consumer
durables and industrial products. Organizational
buying behaviour also comes within the scope of
consumer behaviour.
Name : - Singh Rahul Rajendra Pushpa Roll no : - 80Subject : - Marketing and Human Resource
Management
(6) Consumer behaviour is always uncertain as the
thinking process in human mind is uncertain.
(7) Consumer behaviour gives answer to various
questions such as why, what and how consumers
purchase goods and services.
(8) Study of consumer behaviour is a must in the
case of marketing of goods and services as such
study brings success to marketing efforts.
(9) Consumer buying behaviour is a challenge and an
opportunity to a market. Large-scale marketing is
possible only when consumer behaviour is
anticipated accurately.
Name : - Singh Rahul Rajendra Pushpa Roll no : - 80Subject : - Marketing and Human Resource
Management
Factors Affecting Consumer Behaviour:-
Consumer behaviour refers to the selection,
purchase and consumption of goods and services for
the satisfaction of their wants. There are different
processes involved in the consumer behaviour.
Initially the consumer tries to find what commodities
he would like to consume, then he selects only those
commodities that promise greater utility. After
selecting the commodities, the consumer makes an
estimate of the available money, which he can spend.
Lastly, the consumer analyzes the prevailing prices of
commodities and takes the decision about the
commodities he should consume. Meanwhile, there
are various other factors influencing the purchases of
consumer such as social, cultural, personal and
psychological. The explanation of these factors is
given below.
1. Cultural Factors
Name : - Singh Rahul Rajendra Pushpa Roll no : - 80Subject : - Marketing and Human Resource
Management
Consumer behaviour is deeply influenced by cultural
factors such as buyer culture, subculture, and social
class.
a. Culture
Basically, culture is the part of every society and is
the important cause of person wants and behaviour.
The influence of culture on buying behaviour varies
from country to country therefore; marketers have to
be very careful in analyzing the culture of different
groups, regions or even countries.
b. Subculture
Each culture contains different subcultures such as
religions, nationalities, geographic regions, racial
groups etc. Marketers can use these groups by
segmenting the market into various small portions.
For example, marketers can design products
according to the needs of a particular geographic
group.
Name : - Singh Rahul Rajendra Pushpa Roll no : - 80Subject : - Marketing and Human Resource
Management
c. Social Class
Every society possesses some form of social class,
which is important to the marketers because the
buying behaviour of people in a given social class is
similar. In this way, marketing activities could be
tailored according to different social classes. Here we
should note that social class is not only determined
by income but there are various other factors as well
such as wealth, education, occupation etc.
2. Social Factors
Social factors also impact the buying behaviour of
consumers. The important social factors are reference
groups, family, role and status.
a. Reference Groups
Reference groups have potential in forming a person
attitude or behaviour. The impact of reference groups
varies across products and brands. For example if the
product is visible such as dress, shoes, car etc then
Name : - Singh Rahul Rajendra Pushpa Roll no : - 80Subject : - Marketing and Human Resource
Management
the influence of reference groups will be high.
Reference groups also include opinion leader (a
person who influences other because of his special
skill, knowledge or other characteristics).
b. Family
Buyer behaviour is strongly influenced by the
member of a family. Therefore, marketers are trying
to find the roles and influence of the husband, wife
and children. If the buying decision of a particular
product is influenced by wife then the marketers will
try to target the women in their advertisement. Here
we should note that buying roles change with change
in consumer lifestyles.
c. Roles and Status
Each person possesses different roles and status in
the society depending upon the groups, clubs, family,
organization etc. to which he belongs. For example, a
woman is working in an organization as finance
manager. Now she is playing two roles, one of finance
Name : - Singh Rahul Rajendra Pushpa Roll no : - 80Subject : - Marketing and Human Resource
Management
manager and other of mother. Therefore, her buying
decisions will be influenced by her role and status.
3. Personal Factors
Personal factors can also affect the consumer
behaviour. Some of the important personal factors
that influence the buying behaviour are lifestyle,
economic situation, occupation, age, personality and
self-concept.
a. Age and life cycle
Age and life cycle have potential impact on the
consumer buying behaviour. It is obvious that the
consumers change the purchase of goods and
services with the passage of time. Family life cycle
consists of different stages such young singles,
married couples, unmarried couples etc, which help
marketers to develop appropriate products for each
stage.
b. Occupation
Name : - Singh Rahul Rajendra Pushpa Roll no : - 80Subject : - Marketing and Human Resource
Management
The occupation of a person has significant impact on
his buying behaviour. For example, a marketing
manager of an organization will try to purchase
business suits, whereas a low-level worker in the
same organization will purchase rugged work clothes.
c. Economic Situation
Consumer economic situation has great influence on
his buying behaviour. If the income and savings of a
customer is high then he will purchase more
expensive products. On the other hand, a person with
low income and savings will purchase inexpensive
products.
d. Lifestyle
Lifestyle of customers is another import factor
affecting the consumer buying behaviour. Lifestyle
refers to the way a person lives in a society and is
expressed by the things in his/her surroundings. It is
determined by customer interests, opinions, activities
Name : - Singh Rahul Rajendra Pushpa Roll no : - 80Subject : - Marketing and Human Resource
Management
etc and shapes his whole pattern of acting and
interacting in the world.
e. Personality and self concept
Personality changes from person to person, time to
time and place to place. Therefore, it can greatly
influence the buying behaviour of customers.
Actually, Personality is not what one wears; rather it
is the totality of behaviour of a man in different
circumstances. It has different characteristics such as
dominance, aggressiveness, self-confidence etc which
can be useful to determine the consumer behaviour
for particular product or service.
4. Psychological Factors
There are four important psychological factors
affecting the consumer buying behaviour. These are
perception, motivation, learning, beliefs and
attitudes.
a. Motivation
Name : - Singh Rahul Rajendra Pushpa Roll no : - 80Subject : - Marketing and Human Resource
Management
The level of motivation also affects the buying
behaviour of customers. Every person has different
needs such as physiological needs, biological needs,
social needs etc. The nature of the needs is that,
some of them are most pressing while others are
least pressing. Therefore, a need becomes a motive
when it is more pressing to direct the person to seek
satisfaction.
b. Perception
Selecting, organizing and interpreting information in a
way to produce a meaningful experience of the world
is called perception. There are three different
perceptual processes, which are selective attention,
selective distortion and selective retention. In case of
selective attention, marketers try to attract the
customer attention. Whereas, in case of selective
distortion, customers try to interpret the information
in a way that will support what the customers already
believe. Similarly, in case of selective retention,
Name : - Singh Rahul Rajendra Pushpa Roll no : - 80Subject : - Marketing and Human Resource
Management
marketers try to retain information that supports their
beliefs.
c. learning:
Learning relates to changes in individual behaviour
that are caused by information and experience e.g.,
when a consumer buys a car and is satisfied with its
performance, he will recommend this brand to others
also. Through learning people shape their beliefs and
attitudes.
d. beliefs:
Beliefs are based on knowledge, opinion, faith and
confidence. It is a descriptive thought that a person
holds about certain things. Brand image is the result
of beliefs, which eventually influences buying
behaviour.
e. attitude:
An attitude is a person’s favourable or unfavourable
evaluation of a product/service. Attitude develops
Name : - Singh Rahul Rajendra Pushpa Roll no : - 80Subject : - Marketing and Human Resource
Management
over a period of time. It is long lasting. Attitude
influences buying behaviour of consumers e.g., a
consumer having positive attitude will spend on
luxuries because he considers it as an investment
whereas another consumer may consider it waste of
money.
The forces noted above are external force but they
influence consumer behaviour considerably. The
marketer has to consider his product and the
satisfaction it offers to consumers. In addition, he has
to see that his product is as per modern culture and
life style. The marketer has to consider the social and
cultural influences on consumers while designing his
marketing strategy.
5. Economic Factors
Economic factors such as income and purchasing
power affect buyer behaviour. A rich buyer may not
be very alert about the price and may purchase a
product with high price. A person from low-income
Name : - Singh Rahul Rajendra Pushpa Roll no : - 80Subject : - Marketing and Human Resource
Management
group will be very sensitive/alert about the price and
may not purchase the product even with limited price
rise. The middle class buyers prefer to collect
information on price from different sources and take
appropriate buying decision. Buyer behaviour
affected due to high or low purchasing power.
Economic factors include:
a. Disposable Personal Income:
It refers to the money at the disposal of the consumer
to spend e.g., in a small family where every member
is earning the consumer will have higher disposable
personal income. As against this where only one
person is working and there are many more mouths
to be fed, disposable personal income will be low.
b. Size of Family:
A small family is a happy family. It is possible to
provide better quality life to the family members. In
case of a large sized family demands are too many
and economic means to satisfy them are highly
Name : - Singh Rahul Rajendra Pushpa Roll no : - 80Subject : - Marketing and Human Resource
Management
restricted. The result is presence of dissatisfied
needs.
c. Propensity to consume and save:
Saving for rainy days always helps the consumer. It
does not mean he is not going to spend. He will lead
his life within his source of income but make it a point
to save. He strikes a balance between consumption
and saving.
d. Consumer credit:
Availability of credit, other things remaining the
same, improves the purchasing power of the
consumers. They can look forward to possessing
several things that ordinarily would have remained
outside their reach such as house or car.
e. Discretionary income:
It refers to availability of additional income, which
improves the economic status of a consumer. In order
Name : - Singh Rahul Rajendra Pushpa Roll no : - 80Subject : - Marketing and Human Resource
Management
to have it, the consumer is required to put in extra
efforts. Certainly, his economic status improves.
Buyer behaviour - The decision-making
process
How do customers buy?
Research suggests that customers go through a five-
stage decision-making process in any purchase. This
is summarized
In the diagram below:
Name : - Singh Rahul Rajendra Pushpa Roll no : - 80Subject : - Marketing and Human Resource
Management
This model is important for anyone making marketing
decisions. It forces the marketer to consider the
whole buying process rather than just the purchase
decision (when it may be too late for a business to
influence the choice!)
The model implies that customers pass through all
stages in every purchase. However, in more routine
purchases, customers often skip or reverse some of
the stages.
Name : - Singh Rahul Rajendra Pushpa Roll no : - 80Subject : - Marketing and Human Resource
Management
For example, a student buying a favourite hamburger
would recognize the need (hunger) and go right to the
purchase decision, skipping information search and
evaluation. However, the model is very useful when it
comes to understanding any purchase that requires
some thought and deliberation.
The buying process starts with need recognition. At
this stage, the buyer recognizes a problem or need
(e.g. I am hungry, we need a new sofa, I have a
headache) or responds to a marketing stimulus (e.g.
you pass Starbucks and are attracted by the aroma of
coffee and chocolate muffins).
An “aroused” customer then needs to decide how
much information (if any) is required. If the need is
strong and there is a product or service that meets
the need close to hand, then a purchase decision is
likely to be made there and then. If not, then the
process of information search begins.
A customer can obtain information from several
sources:
Name : - Singh Rahul Rajendra Pushpa Roll no : - 80Subject : - Marketing and Human Resource
Management
• Personal sources: family, friends, neighbors etc
• Commercial sources: advertising; salespeople;
retailers; dealers; packaging; point-of-sale displays
• Public sources: newspapers, radio, television,
consumer organizations; specialist magazines
• Experiential sources: handling, examining, using the
product
The usefulness and influence of these sources of
information will vary by product and by customer.
Research suggests that customer’s value and respect
personal sources more than commercial sources (the
influence of “word of mouth”). The challenge for the
marketing team is to identify which information
sources are most influential in their target markets.
In the evaluation stage, the customer must choose
between the alternative brands, products and
services.
How does the customer use the
information obtained?
Name : - Singh Rahul Rajendra Pushpa Roll no : - 80Subject : - Marketing and Human Resource
Management
An important determinant of the extent of evaluation
is whether the customer feels “involved” in the
product. By involvement, we mean the degree of
perceived relevance and personal importance that
accompanies the choice.
Where a purchase is “highly involving”, the customer
is likely to carry out extensive evaluation.
High-involvement purchases include those
involving high expenditure or personal risk – for
example buying a house, a car or making
investments.
Low involvement purchases (e.g. buying a soft
drink, choosing some breakfast cereals in the
supermarket) have very simple evaluation processes.
Why should a marketer need to
understand the customer evaluation
process?
Name : - Singh Rahul Rajendra Pushpa Roll no : - 80Subject : - Marketing and Human Resource
Management
The answer lies in the kind of information that the
marketing team needs to provide customers in
different buying situations.
In high-involvement decisions, the marketer needs to
provide a good deal of information about the positive
consequences of buying. The sales force may need to
stress the important attributes of the product, the
advantages compared with the competition; and
maybe even encourage “trial” or “sampling” of the
product in the hope of securing the sale.
Post-purchase evaluation - Cognitive
Dissonance
The final stage is the post-purchase evaluation of the
decision. It is common for customers to experience
concerns after making a purchase decision. This
arises from a concept that is known as “cognitive
dissonance”. The customer, having bought a product,
may feel that an alternative would have been
preferable. In these circumstances, that customer will
Name : - Singh Rahul Rajendra Pushpa Roll no : - 80Subject : - Marketing and Human Resource
Management
not repurchase immediately, but is likely to switch
brands next time.
Case study
Tata Nano: Consumers' Post-Purchase Behaviour
Abstract:
Hundred years ago, when Henry Ford unveiled ‘Model
T’ in US as the people’s car, many a company
followed suit. Incidentally, after a century, history
repeated itself when Ratan N. Tata (Ratan Tata),
chairman of Tata Sons, the promoter company of the
Tata group, announced his long-cherished dream to
produce the world’s cheapest car, Tata Nano, at an
amazing price of INR 1lakh.
Introduction:
As Tata Nano vroomed to the customers on March
23rd 2009, few questions arose: How are the
Name : - Singh Rahul Rajendra Pushpa Roll no : - 80Subject : - Marketing and Human Resource
Management
consumers receiving it? Has the dream of Ratan Tata
come true? Set in early 2010, this case study focuses
on the post-purchase behaviour of Tata Nano buyers.
The post-purchase perceptions, dissonance levels and
moments of pride have been analysed with the help
of primary data collected through video interviews
conducted among 8 customers of Tata Nano in
Hyderabad, India, in mid-January 2010. The case
study runs in the backdrop of the conceptualization of
the Tata Nano car and the roadblocks that cropped up
during its production. This case study, primarily
positioned to discuss the dissonance levels in new
products, offers valuable insights.
Pedagogical Objectives:
To understand the conceptualization of Nano car as
the world’s cheapest car by Tata Motors and
analyse the causes and concerns in taking the car
from drawing board to board room to the shop floor
To understand the bottlenecks involved in the
production of Tata Nano and critically examine the
Name : - Singh Rahul Rajendra Pushpa Roll no : - 80Subject : - Marketing and Human Resource
Management
influence of those bottlenecks on the buying
behaviour of the customers while purchasing Tata
Nano, as well as on the brand Tata and its impact
on the brand loyalty thereof
To raise a general debate on addressing all the
possible cognitive dissonance touch points in the
case of new products – launched by either an
existing and established company or a new
company.
Bibliography
Title Consumer Behaviour Author Atul Kr. Sharma
Publisher Global Vision Publishing Ho,
2006ISBN8182201861,
9788182201866Length183 pages Subjects
Consumer behavior
MHRM N.G. Kale, M. Ahmed
Weblography
Name : - Singh Rahul Rajendra Pushpa Roll no : - 80Subject : - Marketing and Human Resource
Management
http://www.ehow.com/about_5162253_definition-
consumer-behavior.html#ixzz221r0k179
http://www.ehow.com/about_5162253_definition-
consumer-behavior.html
http://www.aipmm.com/html/newsletter/
archives/000434.php
http://tutor2u.net/business/marketing/
buying_decision_process.asp
http://en.wikipedia.org/wiki/
Buyer_decision_processes