Consumer Behaviour (CB)

CB is defined as the behaviour that consumer display in “searching for, purchasing, using, evaluating and disposing of products and services that they expect will satisfy their needs. CB focuses on now individuals make decisions to spend their available resources (time, money, effort) on consumption related items. That includes:

•What they buy

•Where they buy

•Why they buy

•When they buy it

•How often they buy

•How often they use it

•How they evaluate it after the purchase

•Impact of these evaluations on future purchase

•How they dispose of it

CB describes two different kinds of consuming entities:

•Personal consumer

•Organizational consumer (project & non project org. govt. agenties institutions i.e. school, hospitals, prisons etc.)

Demographics– are statistics that measure observable aspects of a population such as birthrate, age, gender, income etc. one of the most important segment for the marketer.

Lifestyle and Psychographic Segmentation– Lifestyle is basically now a person lives. It is now one enacts his/her self concept. It is determined by the persons past experiences, innate characteristics and current situations.

Psycho (mental) Graphic (profiling) may be viewed as the method of defining lifestyle in measurable terms. It is the systematic use of relevant activity, interest and opinion constructs to quantitatively explore and explain the communicating, purchasing and consuming behaviours of persons for brands, products and cluster of products.

Psychographic (including lifestyles) and demographic profiles are highly complementary approaches that work best when used together. By combining the knowledge marketers are provided with powerful information about tgt segment.

Lifestyle Marketing– Lifestyle frequently provides the basic motivation and guidelines for purchases, although it does so in an indirect and subtle manner.

Lifestyle and the consumption process

Lifestyle Determinants• Demographics• Subculture• Social class• Motives• Personality• Emotions• Values• Household life cycle• Culture• Past experience

LifestyleHow we live• Activities• Interests• Likes/Dislikes• Attitudes• Consumptions• Expectations• Feelings

Impact on BehaviourPurchases• How• When• Where• What• With whomConsumption• Where• With whom• How• When• What

Measurement of Lifestyle–

• Attitude – Evaluative statement about other people, places, ideas, products etc.

• Values – Widely held beliefs about what is acceptable/desirable.

• Activities & Interests – Non-occupational behaviour to which consumes devote time and effort e.g. hobbies, sports, public service.

The Technique of Lifestyle Segmentation–

Lifestyle segmentation measure (i) how people spend their time engaging in activities (ii) what is of most interest/important to them in their immediate surroundings (iii) their opinion and views about themselves and world around them (AIOS).

Lifestyle Dimensions

Activities Interests Opinions Demographics

Work Family Themselves Age

Hobbies Home Social issues Education

Social events Job Politics Income

Vacation Community Business Occupation

Entertainment Recreation Economics Family size

Club Member Fashion Education Dwelling (house to live-in)

Community Food Products Geography

Shopping Media Future City size

Sports Achievements Culture Stage in lifecycle

Demographics– age, education, income, occupation, family structure, gender, geographic location.

• Media pattern – the specific media the consumers utilize.

• Usage Rates – measurement of consumption within a specified port category; often consumers are characterized as heavy, medium, light or nonusers.

VALS – Introduced in 1978 VALS (Values & Lifestyles) given by SRI Consulting Business Intelligences is the most popular application of psychographic research by marketing managers.

SRIC – BI has identified there primary self orientations.

• Principle Oriented – These individuals are guided in their choices by their beliefs and principles rather than by feelings, events or desire for approval.

• Status oriented – The actions, approval and opinion of others heavily influence these individuals.

Experiences and Makers : Action Oriented

Experiences – are young, vital, enthusiastic, impulsive and rebellious. They seek variety and excitement, savoring the new, the offbeat and the …..

Makers – are practical people who have constructive skills and value self sufficiency. They live within a traditional context of family, practical work and physical recreation and have little interest in what lies outside that context.

Actualizers/Innovation – are successful, sophisticated active, take charge people with high self esteem and abundant resources. They are interested in growth and seek to develop, explore and express themselves in a variety of ways.

Strugglers/Survivors – Their lives are constricted. They are poor with limited education and skills, without strong social bonds, frequently elderly and concerned about their health they are often resigned and passive.

Action Oriented – These individual desire social or physical activity, variety and risk taking.

Fulfields and believers: Principle oriented

Fulfields – are mature, satisfied, comfortable, reflective people who value order, knowledge and responsibility. They are well educated and are in professional occupation.

Believers – are conservative, conventional people with concrete beliefs based on tradition established codes: family, community, church & the nation.

Achievers & strivers: Status oriented

Achievers – they are successful career and work oriented people who like to and generally do, feel in control of their lives. They value consensus, predictability and stability over risk, intimacy and self discovery.

Strivers – they seek motivation, self definition and approval from the world around them.

They are striving to find a secure place in life. They are concerned about opinion and approval of others, environmental factors affecting consumers.They are of two types:1. Internal variables– They comprise of factors that are present within the consumers.– They differ with individuals.They include:• Motivation• Perceptions• Learning• Beliefs• Values• Customer & attitude• Personality2. External variables: They are present outside the customer and influences his buying behaviour. They include:• Consumer culture• Social factors• Reference grp• Family & roles• Status

Decision-Making Process – A decision is the selection of an action from two or more alternative choices.

Buying Roles:

1. Initiator – A person who first suggests the idea of buying the part/service.

2. Influencer – A person whose view/advice infevers the decision.

3. Decider – A person who decides on any component of a buying decision – where to buy, how to buy etc.

4. Buyer – The person who makes the actual purchase.

5. User – A person who consumes/uses the pelt/service.

Buying Behaviour – Consumer decision-making varies with the type of buying decision. Atypes of consumer behavior has been identified based on the degree of involvement and the degree of differences amongst the brands.

Complex BuyingBehaviour

(expensive, bought infrequently, risky, highly self expressive e.g.

car, laptop, house)

Variety seeking buying behaviours (e.g. cookies, dominated by)

Dissonance reducingBuying Behaviour

e.g. carpet(First acted, then acquired new

beliefs, then set of attitude)

Habitual buyingBehaviour

(e.g. salt) (brand familarity leads to purchase)

High Involvement Low Involvement

Significantdifference

between brands

Few differences between brands

Levels of Consumer Decision-Making

(i) Extensive Problem Solving – When consumers have no established criteria for evaluating a pelt category or specific brands in that category or have not narrowed the no.. Of brands they will consider to a small manageable subset, their decision-making efforts can be classified as extensive problem solving.

(ii) Limited Problem Solving – At this level of problem solving, consumers already have established the basic criteria for evaluating the pelt category and the various brands in the category. However they have not fully established preferences concerning a select group of brands.

(iii) Routinized Response Behaviour – At this level consumers have experience with the pelt category and a well established set of criteria with which to evaluate the brands they are considering. In some situations they may search for a small amt. of additional information in others they simply review what they already know.

Models of consumers: Four views of Consumer Decision Making:

(i) An Economic View – In this the consumer has been characterized as making rational decisions.

(ii) A Passive View – Opposite to rational economic view of consumers is the passive view that depicts the consumer as basically not submissive to the self servicing interests and promotional efforts of marketer.

(iii) A Cognitive View – It potrays the consumer as thinking problem solver. This model focuses on the process by which consumers seek and evaluate information about selected brands and retail outlet.

(iv) An Emotional View – Consumer can be a emotional or impulsive buyer and is likely to associate deep feelings or emotions as joy, fear, love, hope, fantasy with certain purchases/possessions.

Problem Recognition

Information Search

Evaluation of Alternatives

Purchase Decision

Post Purchase Behaviour

Five Stage Model of Consumer Buying Behaviour

External InfluenceFirms Marketing

Efforts• Product• Promotion• Price• Channel of …….

Socio-cultural Env.• Family• Informal Sources• Non comm. sources• Social class• Subculture/culture

Input

Consumer Decision-Making

Need Recognition

Prepurchase search

Evaluation of Alternatives

Psychological Field• Motivation• Perception• Learning• Personality• Attitude

Process

Experience

Purchase• Trial• Repeat purchase

Post-purchaseevaluation

Output Model of consumer decision making

Post-purchase behaviour

CULTURAL

• Culture

• Subculture

• Social class

SOCIAL

• Reference Group

• Family

• Roles & Statuses

PERSONAL

• Age & life cycle stage

• Occupation

• Lifestyle

• Personality & self concept

• Economic circumstances

PSYCHOLOGICAL

• Motivation

• Perception

• Learning

• Beliefs & Attitudes

BUYER

Factors Influencing Consumer Behaviour

An Overview of Problem Recognition

How consumers fell about the product

Process & factors of problem recognition

His expectations from the composition of a new product

Existing consumer position

Desired consumer position

Perceived gap/ Discripancy tension (Threshold level problem)

Stock out

Dissatisfaction with present stock

Enhancement in funds

Marketing efforts

Problem recognition

Every gap does not cross the threshold level. Marketers increase the gap and increase the tension level so that purchase can be made.

Recognition of new need situation

Generation of new wants

Availability of new pelt offering

Changing environmental circumstances

Contributed by

Types of Problem Recognition

Immediacy of Solution

Expectancy of Immediate Solution Immediate SolutionProblem Required not Required

Occurance of Routine PlanningProblem Expected

Occurance of Emerging EvolvingProblem unexpected

Information sources for a purchase decision

Information sources

Internal Information

ExternalInformation

Actively Acquired Passively Acquired Actively Acquired

Past Searches

Personal experience

Low involvement learning

Independent Groups

Personal contacts Marketer Information

Experimental

Magazines, consumer groups and govt. agencies

Friends/Family Sales person website advt.

(Pdt inspection/pdt trial)

All Brands

Known Brands Unknown brands

Acceptable Brands

Unacceptable Brands

IndifferentBrands

Over-lookedBrands

PurchasedBrands

NotPurchased

Brand

Evolved set Inept set Inert set

(1)

(2) (3) (4)

(5)(4)

All Brands

Known Brands Unknown brands

Acceptable Brands

Unacceptable Brands

IndifferentBrands

Over-lookedBrands

PurchasedBrands

NotPurchased

Brand

Evolved set Inept set Inert set

(1)

(2) (3) (4)

(5)

How Consumer Use or Dispose of Products

Rent it

Lend it Rent it

Lend itGive it

Trade it

Sell it

Throw it away

Use it to serve original purpose

Convert it to serve new purpose

Store it

Direct to consumer

Through middleman

To intermediary

Product Get rid of it permanent

Keep it

Get rid of it temporarily

Product value

Servicesvalue

Personal value

Image value

Monetarycost

Timecost

Energycost

Psychiccost

Total Customer

value

Total Customer

cost

Customer Delivered

Value

Models of Consumers – Three views of consumer decision making:

The term “models of consumers” refer to a general view/perspective as to how (and why) individuals behave as they do.

(i) Economic view

(ii) Passive view

(iii) Cognitive view