INTRODUCTION - assignmentsexcellence.comassignmentsexcellence.com/download/Marketing.docx · Web viewThe report analyses the buying pattern and behavior of the consumer by looking

Running Head: Individual Consumer Analysis

Individual Assessment 1: Consumer Behavior Insights

BUMKT5902 MARKETING MANAGEMENT

Partner location Semester 2, 2017

Student Name__________

Student ID__________

Lecturer Name___________

The Due Date and Time__________

Consumer Analysis Report 16

EXECUTIVE SUMMARY

The report analyses the buying pattern and behavior of the consumer by looking at the shopping

of one week that is explained in a separate excel sheet. The overall objective of this report is to

develop an understanding of the consumer and how a consumer understanding is a key input to

the creation of an effective and efficient marketing mix strategy. In purchasing of one week, the

consumer has purchased 22 products. The consumer has spent a large portion of his money on

low involvement products. The overall results of the analysis clearly show that quality,

convenience and price have been the most important marketing mix factors to the consumer’s

decision-making process. Samsung tab is the high involvement product that consumer

purchased during one week of shopping. It shows consumer is tech savvy. Also, the customer is

highly health and quality conscious. Moreover, the customer has mainly spent on fulfilling his

physiological needs that are known as first level of Maslow hierarchy of needs. Keeping into

account the buying behavior/pattern of the consumer, few suggestions have been also made to

better define the marketing mix strategy in the end.


Table of Contents1. INTRODUCTION....................................................................................................................4

1.1. Background & Purpose of Report...................................................................................4

1.2. Description of the Consumer...........................................................................................5

2. MAIN ANALYSIS....................................................................................................................5

2.1. Purchasing Behavior.......................................................................................................5

2.2. Customer value and Value Proposition...........................................................................6

2.3. Description/analysis of the decision making for the week’s purchases...........................6

2.3.1. Customer’s Buying (Purchase)................................................................................6

2.3.2. Product Need Recognition.......................................................................................6

2.3.3. Evaluation of Alternatives........................................................................................6

2.3.4. Post Purchase Behavior..........................................................................................7

2.3.5. Decision-Making Time.............................................................................................7

2.3.6. Shopping on Week/Weekend Days.........................................................................7

2.3.7. Payment Mode.........................................................................................................8

2.3.8. Influencing Factors...................................................................................................8

Convenience...................................................................................................................9

Quality.............................................................................................................................9

Price..............................................................................................................................10

Service..........................................................................................................................10

Health............................................................................................................................10

Taste.............................................................................................................................10

Incentive........................................................................................................................10

2.3.9. Maslow Hierarchy Need Theory.............................................................................11

Physiological Need........................................................................................................11

Safety............................................................................................................................11

Social & Belongingness Needs.....................................................................................12


Self-Esteem...................................................................................................................12

Self Actualization...........................................................................................................12

2.4. Nominated products for high involvement products..................................................13

2.5. Compare/contrast for the week’s purchases and the nominated product.................14

3. KEY INSIGHTS & RECOMMENDATIONS..........................................................................14

4. REFERENCES.....................................................................................................................16


1. INTRODUCTION

1.1. Background & Purpose of Report

It is very important to analyze the factors that influence the buying decisions of a consumer.

For instance, there are several personal, external and internal factors that can transform a

customer’s ‘no’ decision into a yes or vice versa. Thus, it is indispensible to examine those

factors that influence and predict behavior of consumers. It is possible to say that the overall

agenda of this report is to develop an understanding of the consumer and how a consumer

understanding is a key input to the creation of an effective and efficient marketing mix strategy.

In this report, the overall purchase behavior of the customer is analyzed with the help of

integrating marketing theories and concepts. For this purpose, a sufficient number of tables and

charts have been also used in the main body of the paper.

1.2. Description of the Consumer

The consumer is a male person of age 25. He is independent as he works as a part-time

employee in a retail store. He is not married and lives with his friends and relatives in

Melbourne. Currently, he is doing his bachelors from the Federation University of Australia. As

far as Psychographics are concerned, it is possible to say that the consumer prefers a healthy

life style that’s why whenever he purchases a product or obtains service he takes into account

quality and healthy items that are highly reliable and of high quality. Particularly, with reference

to Roy Morgan Values Segments, it won’t be wrong to say that the consumer belongs to two

values segments including young optimism and socially aware. It’s worth mentioning here that

values segments refer to a ground-breaking system of market segmentation that goes further

than demographics and psychographics in order to discover the values, states of minds and

attitudes that stimulate consumer behavior ("About Values Segments", 2017). The consumer is

socially aware because he is highly socially active. He likes to search for new and different

things that have some value. He looks for detailed information about available alternatives and

then takes into consideration the outcomes of each alternative vigilantly before taking a final

decision. Moreover, he belongs to value segment of ‘young optimism’ where he positively

thinks about every aspect of life. They tend to see positive sides of things ("Young Optimism",

2017).


2. MAIN ANALYSIS

In 7 days (1 week), the consumer has purchased 22 products including both cheap and

expensive products. All the goods and services that are bought by the consumer are included in

the separate excel file with a relevant and structured categorization. Now it is important to

analyze the shopping behavior of the consumer using below-mentioned marketing theories and

concepts of buyer behavior.

2.1. Purchasing Behavior

After analyzing the buying pattern of the consumer, it can be stated that a large portion of the

shopping has done by the customer on week days while few products and services have been

obtained on weekends.

2.2. Customer value and Value Proposition

In order to make a product more functional, the quality and features of a product or a service are

enhanced and this is called value adding. It can be claimed that the customer value proposition

is all about developing and delivering the value of the products. In other words, it refers to a

business or marketing statement that explains why a buyer should purchase a product or avail a

service. While planning marketing strategies marketing planners consider the importance of

developing value proposition (Gunasekaran, Krishnadevarajan & Lawrence, 2012).

2.3. Description/analysis of the decision making for the week’s purchases

2.3.1. Customer’s Buying (Purchase)

The purchase is itself involves a decision –making process that consumers used related to

market transactions before, during, and after the buying of a good or service (Lee, 2005). Here

we can analyze the consumer decision making process using the following steps.

2.3.2. Product Need Recognition


Without the recognition of the need, the purchases of the consumer cannot be made (Karimi,

2013). For instance, the need for water, juice, pizza, dinner was triggered by the consumer’s

thirst and hunger. In the same vein, the need for the purchase of Samsung tab was triggered by

external factors including word of mouth by friends and media advertisement.

2.3.3. Evaluation of Alternatives

Before taking a final decision, a consumer values all available product alternatives. The

evaluation process is also influenced by the factor of involvement. In case the customer is

positive and there is high involvement, then he/she will assess various companies or brands;

but if there is low involvement, only one company or brand will be assessed by the customer

(Lee, 2005). By looking at the spreadsheet, it becomes clear that for some of the products, the

customers had alternatives and for some others, there were no substitutes available. For

instance, the customers had no alternatives for milk, water, medicine, and car fuel and iPhone

charger. And the customer evaluated different other brand and companies before buying the

Samsung tab and the novel.

2.3.4. Post Purchase Behavior

At this stage, the consumer will compare the purchased items with his earlier expectations and

will be either satisfied or dissatisfied. This satisfaction or dissatisfaction undeniably can impact

on the decision process for same purchases from the same brand in the future. In case, the

customer got satisfied it will make the customer a loyal customer and assessment of alternative

stages will repeatedly be reduced or skipped altogether.

2.3.5. Decision-Making Time

Decision-making time is highly based on the level of involvement in buying the product by the

consumer. For example, if a customer is highly involved in the buying decision, then he or she is

most likely to take a lot of time in making the final choice of the item. On the contrary, if the

involvement level is low, the purchase will not have any preplanning and will not consume much


time. The excel spreadsheet indicates that the consumer during one week of shopping has

taken less time on purchasing most of the items as those were low involvement products. In

contrast, the consumer has taken almost 4-5 days in purchasing high involvement products.

2.3.6. Shopping on Week/Weekend Days

The information available on excel sheet clearly shows that the consumer made few purchases

on weekend and majority of the purchases have done on week days. For example, out of 22

total purchased items, the consumer bought only 7 products on weekend and rest of the items

on weekdays. Similarly, the consumer bought the most luxury products on weekend after

spending few days on planning and decision-making process.

Weekend29%

Weekdays71%

Week days/Weekends

2.3.7. Payment Mode

The customer used only two methods of payment and that are cash and credit card. The

payment mode section of the spreadsheet points out that the customer has purchased only 8

product using cash. It means the customer provided currency in return of goods and services.

On the other hand, the credit card has been used to purchases 14 products. It can be seen that

the customer has made mostly high priced products through credit card. And cash has been

used to buy daily basic items.


2.3.8. Influencing Factors

As it is mentioned in the starting of the report that consumer buying decision and buying

patterns or behaviors can be influenced by both internal and external factors. In this shopping of

7 days, different factors have undoubtedly impacted on the decision-making of the consumer.

The factors that have been analyzed in this manner are:

Price

Health

Quality

Convenience

Taste

Incentive

Services

Price17%

Health13%

Quality19%

Convienience23%

Taste12%

Incentive3% Service

13%

Influening Factors

ConvenienceIt is important to say that convenience has been the most impactful factor. It is mainly because

the customer personally prefers straightforwardness and convenience. Among all other

influential factors, convenience is of 23 percent and it has the largest contribution as an

influential factor.


QualityIt is second most important factor o which based the customer has made most of its purchases.

It depicts the customer is quality conscious. He prefers originality and genuineness. It is on

number two with 19% influence.

PriceSeveral marketers and experts claim that price is one of the most influential factors that attract

consumers toward purchasing. In other words, majority consumers generally made their buying

on the basis of low price. As far as buying of this consumer is concerned, it won’t be wrong to

say by looking at excel sheet that consumer has considered the price element while buying his

desired products. Price is just behind the element of quality and it is 17%.

ServiceThe consumer is somehow attracted by seeing the customer services of products. Customer

services play a very important role in the competitive environment of today. Businesses all over

the world are paying great attention to this aspect. Similarly, this element stands on 4 th position

with 13 percent.

HealthThe factor of heath also influenced the customer decision in a great way. Its part is 13 percent.

As it is mentioned before that the consumer is highly heath and quality conscious, so he did not

overlook these factors while making buying decision.

TasteThe taste percentage is 12 percent. It is adequate but obviously very less than other factors. In

buying eatable items like dinner, ice-cream, pizza Pepsi etc, the consumer was greatly

influenced by this factor

IncentiveThe percentage of incentive influential factor is just 3% which is not enough. So it can be said

that the consumer is not much attracted by looking at the incentive element of products.


2.3.9. Maslow Hierarchy Need Theory

Maslow’s Hierarchy of Needs is a popular model associated with motivational factors that start

with basic human needs such as friendship, love, security, and ascends upwards to the

increasingly high- level, self- actualization needs of human that a person forms and by this

mean becomes more affluent (Lester, 2009). The consumer buying behavior can be analyzed in

the light of Maslow Hierarchy Need theory.

Physiological83%

Safety4%

Social9%

Esteem4%

Masslow Heirarchy

Physiological NeedThis basic level of hierarchy includes basic human needs such as air, food, drink, shelter,

warmth, sex and sleep (Gawel, 1997). It is possible to say that the consumer has spent much of

his money on buying items that fulfill physiological needs. For instance, he has purchased

dinner, water, ice-cream, Pepsi, fruits, pizza and vegetables.

Safety These are second level needs that are associated with living a safe life. A number of studies

claim that this level of needs include environment security, employment, resources, health, etc


Gawel, 1997). The consumer has spent $5 on fulfilling his safety needs. He purchased medicine

during seven days of shopping.

Social & Belongingness Needs

In Maslow’s hierarchy, the social needs include love, recognition and belonging. The need for

emotional relationships at this level drives behavior of human. Following are some of the things

that satisfy social needs

Friendships

Family

Social groups

Community groups

Churches and religious institutions (Poston, 2009).

The consumer has purchased 2 items for fulfilling his social needs. The most high involvement

product with highest price is associated with this level of need.

Self-EsteemAt this level self-esteem is met where elements like confidence, self-worth, achievement, and

respect are achieved. These are high level needs which cannot be fulfilled from the market. It

can be said that the book is the product that has relation with self-esteem. It means the

customer has spent $15 on fulfilling this level of needs.

Self Actualization This highest level of human needs is achieved when people are able to realize personal

potential, self-fulfillment, and personal growth and crest experiences (Poston, 2009). The excel

spreadsheet clearly shows that the consumer has not achieved this level of need as it takes a

lot of time and cannot be purchased by money.

2.4. Nominated products for high involvement products


A consumer’s behavior is influenced by several factors. Based on experience and knowledge of

a consumer, some consumers may take purchase decisions quickly and other consumers may

require more information and be more involved in the decision process prior to making a

purchase choice. The involvement level reflects how individually significant or interested the

consumer is in consuming a product or service and how much detail the consumer needs to

take a purchase decision (Tanner & Raymond, 2010).

A higher risk and normally higher price tags are associated with high-involvement decisions. For

purchasing high involvement products, the consumers mostly take a lot of time as these

products are not bought often. With regard to 7 days shopping of the consumer, it is possible to

say that there are only a few high involvement products that he bought during one week of

shopping. These products are Samsung Tab, book, and genuine iPhone charger.

1

0

2

4

6

8

10

12

14

16

18

20

3

19

Product Involvement

High InvolvementLow Involvement

2.5. Compare/Contrast for the week’s purchases and the nominated product


During this shopping, the consumer has shopped both low and high involvement products. High

involvement products are elaborated above, whereas low-involvement buying typically involves

low risk and inexpensive products (Hamlin & Welsh, 1999). The total number of purchased

products is 22. Majority of products have been purchased during week days and these are

called week’s purchases. There are almost 19 week products for which the consumer had no

prior planning. For that reason it is also called impulse buying. For instance, he got ice-cream,

Pepsi, pizza, chicken wings, soaps and detergent etc by getting influenced by taste and internal

factors like thirst and hunger. He had no plans for purchasing those items. During one week of

shopping, most of the good and services are referred to low involvement buying as the

consumer took only a few seconds and minutes to bought those less-risky and inexpensive

products. On the other hand, the nominated product which is Samsung Tab took a lot of

consumer time, not seconds or minutes. It took 14 days of the consumer. The nominated

product shows the customers personality, standing and justifying lifestyle. The decision of

buying this nominated product took a lot of consumer’s time and was influenced by friends to a

great extent

3. KEY INSIGHTS & RECOMMENDATIONS

The importance of analyzing consumer behavior cannot be ignored. Consumer Behavior

mainly deals with the different stages a consumer experience before buying products or

services for his end use. For that reason, it is very important to examine customers’ interest,

needs and wants. Without a doubt, there are a number of external and internal factors that set

and alter consumers’ buying pattern and behaviors. So it is also vital to build a complete

understanding of those factors. Experts also argue that it is very important for especially

marketers to understand the psychology of consumers. They need to understand how

consumers can be influenced by their immediate surrounds, family members, friends, relatives,

colleagues and so on.

With reference to above report and excel shopping matrix, it can be concluded that the

customer has been influenced by his immediate external surrounding including friends and

family. In the same vein, his few buying decisions were affected by internal factors such as

hunger, thirst, enjoyment, taste etc. In the wake of analyzing the data on spread sheet, it can be

concluded that customer is highly health and price conscious. He has taken into account the

elements of price and quality while purchasing most of the items of basic needs.


Following suggestions can be made in the perspective of consumer’s buying behavior.

The picture of factors influencing the consumer buying pattern could be clearer. For

instance, the factor of quality has contributed 19%; likewise price has contributed 17%. It

means the customer has considered almost both factors while buying most of the items.

It is also clear quality products are normally available at high price. So this pattern

portrays a confusing picture.

The consumer has purchased few products related to social and safety needs. It is

understandable that these levels of needs were difficult to meet within such a short time

span. But at the same time the consumer should have spent more on fulfilling these

needs to create the balance.

The number of purchased products are although enough, but it should have been more.

4. REFERENCES


Hamlin, R. P., & Welsh, R. S. (1999). Low Involvement Decision Models: Can They Exist?. In Proceedings of the ANZMAC 99 Conference, University of New South Wales, Sydney. Available: http://anzmac. info/conference/1999/Site/H/Hamlin. pdf.

About Values Segments. (2017). Roy Morgan. Retrieved 13 August 2017, from http://www.roymorgan.com/products/values-segments/about-values-segments

Tanner, J., & Raymond, M. A. (2010). Low-Involvement versus high-involvement buying decisions and the consumer’s decision-making process. Marketing Principles.

Karimi, S. (2013). A purchase decision-making process model of online consumers and its influential factora cross sector analysis.

Poston, B. (2009). Maslow’s hierarchy of needs. surgical technologist, 41(8), 347-353.

Gunasekaran, S., Krishnadevarajan, P., & Lawrence, F. B. (2012). Sales and Marketing

Optimization: Developing Competitive Value Propositions in Distribution. (p. 128). Texas: Natl

Assn Wholesale-Distr. Retrieved from: https://books.google.com.pk/books?

id=jyromTNzPB4C&pg=PA128&dq=value+proposition+in+marketing&hl=en&sa=X&ved=0ahUK

EwjDy8bRiebPAhWLfxoKHeibAnsQ6AEIGTAA#v=onepage&q=value%20proposition%20in

%20marketing&f=false

Gawel, J. E. (1997). Herzberg's theory of motivation and Maslow's hierarchy of needs. Practical Assessment, Research & Evaluation, 5(11), 3.

Lee, S. H. (2005). An application of a five-stage consumer behaviour decision making model: An exploratory study of Chinese purchasing of imported health food (Doctoral dissertation, Faculty of Business Administration-Simon Fraser University).

Lester, D. (2013). Measuring Maslow’s Hierarchy of Needs. Psychological Reports: Mental &

Physical Health, 113, 15- 17.

Young Optimism. (2017). Roy Morgan. Retrieved 13 August 2017, from http://www.roymorgan.com/products/values-segments/young-optimism

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INTRODUCTION - assignmentsexcellence.comassignmentsexcellence.com/download/Marketing.docx · Web viewThe report analyses the buying pattern and behavior of the consumer by looking