Consumer Behaviour
Dr. Vibhuti Tripathi
Associate Professor
School of Management Studies
Motilal Nehru National Institute of Technology Allahabad
Prayagraj -211004
Email- [email protected]
Analysing Consumer Markets and Buying Behaviour
Why People Shop ?????
Consumers Mind is a Black Box
Any individual who purchases goods and services from the
market for his/her end-use is called a consumer.
In simpler words a consumer is one who consumes goods
and services available in the market.
Behaviour is defined as “the series of innumerable responses
portrayed by individuals in response to efforts of company and
experience to ones he knows.
Consumer Behaviour is a sum total of all the actions directly
involved in obtaining, consuming and disposing off products
both goods & services including the decision making process which
proceeds
and follow these actions.
Consumer Behaviour is a branch which deals with the various stages a
consumer goes through before purchasing products or services for his end
use.
There are several factors which influence buying decision of a consumer
ranging from psychological, social, economic and so on.
The study of consumer behaviour explains as to:
▪Why and why not a consumer buys a product? (Necessity, for releasing
stress, for status, for socialising etc.)
▪When a consumer buys a product ? (Occasions, Festivals, Monthly,
Frequently, Less frequently)
▪How a consumer buys a product ? (During Sale, High Quantities, Only
Branded, Only through organised retailers, from flee markets, different
products from different places in different quantities etc. )
• The buyer/consumers may not follow any rigid rules while taking the
purchase decisions.
• Everyday they are exposed to a world full of information -
Sources of information could be:
▪ Personal Sources- (Friends, Family, Relatives, Colleagues)
▪ Commercial Sources - (Advertisements, Press Conferences, other
Marketing Communication Modes)
▪ Public Sources - (Opinion of the public in news, shows, other
forums)
▪ Personal Experience- (Satisfaction, Dissatisfaction, Delight)
• Due to this human behaviour is changing constantly affecting an
individual’s purchase decision.
The main catalyst which triggers the buying decision of an individual is need
for a particular product/service. Consumers purchase products and
services as and when need arises.
For satisfying them it is important for an organisation to analyse consumers’
behaviour for
• Consumers’ reactions to a firms marketing strategy. (Segmentation,
Targeting, Positioning)
• The marketing concept stresses that a firm should create a Marketing Mix
(7 Ps) that satisfies (gives utility to) customers, therefore there is a need to
analyse the what, where, when and how consumers buy.
• Marketers can better predict how consumers will respond to marketing
strategies if they know -
• How Consumers make purchase decision
• What influences their purchase decision
Decision Making Decision Making
Consumers have
certain beliefs about
how their needs can
be satisfied
Needs/ Wants Beliefs
Customer’s experience &
Consumers have certain
Disposition experience of others
notions due to their
to Buy which play an important
culture subculture/
role in purchase decision
Buying Without Wanting Buying Without Deciding Deciding Before Buying
Impulse Purchase We plan to buy but don’t We plan to buy specific brands/
Sometime we don’t plan have specific brands/ styles/ styles/ colours/ quantities in
to purchase yet we buy colours/ quantities in mind mind
• When making a decision to buy a product from many
competing products, a consumer unknowingly passes
through a few stages of the decision process.
• Consumers does not pass through all the stages
before purchasing a product.
• The need for a given product is activated by
• Internal stimuli - Personality, experience
•External stimuli - Advertising, culture,
sub-culture
Model of Consumer Behaviour
Organizations can control the stimuli through managing their strategies (STP) and tactics
(7Ps), also there are uncontrollable stimuli related to external business environment and
socio-cultural environment of an individual.
They are always striving to understand the buyers black box (like an aircraft carries all
information) which contains the reasons why consumers buy or don’t buy
Buyers response is an out come of VALUE they receive, satisfaction and dissatisfaction,
usually uncontrollable yet can be managed through ensuring satisfaction or delight
Socio Cultural Environment
INPUT 1. Family
Firm’s Marketing Efforts
2. Informal Sources
1. Product 3. Non Commercial Sources
2. Promotion 4. Social Class, Culture
3. Price
4. Channels of Distribution
P
R
O Need Recognition
C Psychological Field
E Pre Purchase Search Motivation
S Perception
S Learning, Personality
Evaluation of Alternatives
Experiences
Purchase
Trial
OUTPUT Repeat Purchase
Post Purchase Evaluation
Consumer Decision Making Process
The Consumer or Buyer Decision Making Process is a method used by
marketers to identify and track the decision making process of a customer
journey from start to finish.
There are FIVE stages identified through which a consumer transits
1.Need Recognition
1. Need
2. Information Search
2. Alternatives
3. Information Evaluation 3. Best for Me (The brand and
drink type)
4. Purchase 4. Purchase
5. Post Purchase Behaviour
5. Satisfaction /Dissatisfaction
Need Recognition
The realization by the consumer that there is a difference
between “what is” and “what should be”.
The customer feels like something is missing and needs to
address it to get back to feeling normal.
Organisations should determine when the target demographic
develops these needs or wants.
The needs and wants are influenced by marketing stimuli and
internal stimuli
Information Search
Stage in the consumer decision-making process in which the consumer
perceives a need and actively seeks out information concerning products
that will help satisfy that need.
Information is not only gathered about the products via marketing communication
but also from people via recommendations and through previous experiences.
In this stage a customer is also thinks about risk management.
A customer makes a pro’s vs. con’s list to help make their decision.
People often don’t want to regret to make a decision so they take extra time in
information search.
Organizations should ensure to disseminate information
about their offerings through every possible communication
Vehicle like TV, News Paper, Magazines, Hoardings,
Internet, Emails, SMS, Calls etc.
Information Evaluation
umers determine the criteria to be used for evaluation of products.
assess the relative importance of each criteria and,
uate each alternative based on the identified criteria.
the customer has determined what will satisfy their want or need
will begin to seek out the best deal.
may be based on price, quality, or other factors that are important to them.
omers read many reviews and compare prices, ultimately choosing the one that satisfies most of their para
nizations should ensure to understand the parameters on which consumers evaluate their purchase.
Purchase
maller quantity and it would be also termed as Exploratory phase.
samples, offer testers, sell small quantities to induce trials. (There could be many other creat
ly related to brand loyalty, which firms try to encourage because it contributes to greater stab
expectations
Purchase sub-decisions
• Brand Decision Creating right positioning and
brand image
Neighbourhood shop,
•Vendor Decision Exclusive Showroom,
Mall, Multibrand outlet
Location
• Quantity Decision Ensure different pack
sizes to cater to different
Target markets with the
same product
• Timing Decision Recognise occasions
when your product
Is bought most
Cash
• Payment Methods Credit Card
Debit Card
Cheque
DECISION MAKING SET
CHOICE SET
TOTAL SET Best preferred choices
CONSIDERATION SET
All brands and out of consideration set
After evaluation of all
variety available in
alternatives few are matching
the market
the specific needs or expected
value and would be chosen in
case of non-availability of the
one of the chosen brands
DECISION
Post Purchase Behaviour
The purchasing process does not end when a consumer buys a product .
After the purchase consumers tend to evaluate their experience to decide if they
are satisfied or dissatisfied.
There are multiple criteria to evaluate
According to expected benefits and value
perceptions (functional & Emotional benefits
And monetary & non-monetary costs)
The information is used for future reference and for passing on information to
others who seek advice.
Outcomes of
Satisfaction
Loyalty Repeat Purchases Referrals
What influences consumer behaviour ?
1. Cultural Factors
People’s shared customs, beliefs, values t
generated from generation to generation.
Includes religion, language, history, artefa
smaller groups within cultural
framework with common life
experiences and situations.
relatively homogeneous and
enduring divisions in a society.
Division of members of the society into hie
distinct status classes
Members of each class have same status w
members of different groups may have hig
status
Influence of Cultural Factors on Buying Behaviour
Example- Food, Apparels, Lifestyle
It affects what consumers need and how
they perceive that need
Example - Authenticity of
How consumers are likely to search for various information sources
information like friends, family, experts
etc.
Example- Colour,
Importance placed on certain attributes of Technology Acceptance,
products /services Size
Example - Perception of value
Price negotiations during purchase process for Money, More purchases
during SALE time
Example - International cuisines/
How consumers use or consume products food but with Indian taste
2. Social Factors
Factors that are prevalent in the society where a consumer lives.
The society is composed of several individuals that have different
preferences and behaviors.
These varied behaviors influence the personal preferences of the other
set of individuals as they tend to perform those activities which are
acceptable to the society.
Reference Group
Family
Roles & Status
A. Reference Group
a
ng behavior and have a strong influence over each other.
ds
Primary Membership Group Primary Membership Group
Childhood Friends Colleagues
Informal and Frequent Interactions Formal and less frequent interactions
Aspirational Group
Higher social status
Celebrities
A Professional group
Dissociative Groups - A group to which one never wishes to belong to
Dissociative Group
Lower Social Status
Certain groups within reference group
The marketers should try to identify the roles within the reference group that influences
the behavior of others.
Opinion Leaders - a well-known/ popular individual that has the ability to influence the
opinion of those who are in the reference group.
There could be different opinion leaders within the group for different product categories
like fashion, mobile phones, gadgets, holidays etc.
Opinion leadership depends on the expertise / interest of an
individual about different product categories.
B. Family
Persons related by blood, marriage or adoption who
reside together is a family
The family members play a crucial role in designing one’s preferences
and behavior.
It offers an environment wherein the individual evolves, develops
personality and acquire values.
A child develops his buying behavior and preferences by watching his
parents and tend to buy the same products or services even when he
grows old.
Different individuals in the family play different consumption roles
Influencers, deciders, buyers/ purchasers, users, maintainers
Role of family members in case of buying a refrigerator
There seems to be a need to change the refrigerator for a long time but parents are ignoring it.
Son or daughter of the family may become an INFLUENCER by highlighting the need and
collecting information on latest refrigerators available in the market
Mother or Father may decide that it is high time the refrigerator is changed
Mother the DECIDER generally would decide about the capacity and other features of the
refrigerator like convertible selves / water dispenser on the door etc.
Mother or Father may BUY / PURCHASE
Entire family USES
On any fault in the refrigerator the children may call
Engineers or learn through manuals in order to maintain
C. Roles and Status
es and status throughout the life.
e society also influences his buying behavior.
ultiple roles like at her organization she may have a responsibility as senior manager but at home
-Law etc.
nsibilities change.
ent roles an individual in their target group plays
formulate more targeted marketing mix.
Such a woman will have different
needs to play different roles
3. Personal Factors
mers that strongly influence their buying behavior.
n to person that results in a different set of perceptions, attitudes and behavior towa
Basically personal factors define the
individuality of a person alongside few
psychological factors
A. Age & Lifecycle
Age and life-cycle have potential impact on the consumer buying behavior.
It is obvious that the consumers change the purchase of goods and services
with the passage of time.
Young Single professional will have different spending pattern and
consumption preferences in comparison to when he/she gets married
The choice of products, leisure, entertainment, saving patterns everything
change with the transition of life cycle stages.
Organizations should keep a continuous watch on the demographic shift in
their earlier defined target population in order to make relevant and
necessary changes in their market offerings.
B. Occupation
The occupation of a person has significant impact on his
buying behavior.
The people tend to buy those products and services that
advocate their profession and role in the society.
For example, the buying patterns of the lawyer will be
different from the other groups of people such as doctor,
architect, businessman, etc.
C. Economic Situation
Product Choice is greatly affected by economic circumstances of an
individual like:
stability, time duration and level of income, Spendable income,Sav
credit availability, Family Income
D. Lifestyle
Lifestyle is a person’s pattern of living in the world reflected in activities,
interests, opinions and shapes his whole pattern of acting and interacting in the
world.
Lifestyle could be unique to an individual irrespective of belonging to a Family/
Reference Group/ Social Class/ Culture.
Choice of products/services is influenced according to lifestyle
Healthy lifestyle could be the choice of an
Individual .
Not influenced by other influencing factors like
E. Personality
Personality: individual’s distinguishing psychological
Characteristics like - self confidence, dominance, sociability,
adaptability, introvert, extrovert etc.
Personality is not what one wears; rather it is the totality of behavior of a man in
different circumstances.
Consumers buy products which will match their personality
3. Psychological Factors
The Psychological Factors are the factors that talk about the psychology
of an individual that drive his actions to seek satisfaction.
Motivation - a drive, which propels a person
towards achieving his goals
Perception -the process by which an individual selects,
organizes and interprets information inputs to create a
meaningful picture.
Learning - involves changes in an individual’s behavior arising
from experience. It is a continuous process
Attitude & Belief - these are the tendency to respond to a given
situation in a particular way.
A. Motivation
A need becomes a motive when sufficiently backed with intensity.
There are different motives for which consumers buy.
The level of motivation influences the buying behavior of the consumers.
Maslow’s need hierarchy theory comprising of basic needs, security needs,
social needs, esteem needs and self-actualization needs.
People satisfy their most important needs first. The needs are placed in a
hierarchical order.
Freud’s Theory: Psychological forces shaping up peoples’ behavior are largely
unconscious and that a person can not fully understand his or her own motivation.
Organizations must identify the needs and latent motives behind buying their
products to ensure creating value accordingly - Functional or emotional benefits
B. Perception
Perceptions can vary widely among individuals exposed to same situation.
Three perceptual processes;
1. Selective Attention- People pay attention to those things which
in which they are interested
2. Selective Distortion- People comprehend the information or
situations according to their background knowledge
• Selective Retention- People tend remember those things /
situations which are of interest / relevance to them.
Organizations should understand the perception of targeted consumers and
the perceptual process they go through to ensure effective marketing
communication
C. Learning
Consumers can be made to learn the desired behaviour.
The individual’s learning depends on the skills, knowledge and intention.
The skills are developed through practice while the knowledge and
intention are acquired with the experience.
Organisations introducing innovative products/ new usages of the same
product / adding new users may make the consumers learn
1.About benefits of the product / service
•How to use the product
•What kind of people use the product
•Change the wrong perception about the product
D. Attitudes & Beliefs
Attitudes and Beliefs are the tendency to respond to a given situation in a
particular way.
These are developed by doing and learning.
Attitudes tend to be enduring, and because they are based on people’s values
and beliefs, they are hard to change.
Consumers purchase products/services based on their opinions which they
form towards them.
A product might be really good but if the consumer feels it is not worth, he
would never buy it.
Types of Buying Behaviours
• Consumers would demonstrate different buying behaviour
based on;
Involvement- Interest in buying
Nature of Products - Less/more frequently purchased,
Socially visible/ closely consumed
Toothpaste / Brush / Soap etc. - Low Involvement
Car / Bike - High Involvement - less frequently purchased,
Socially visible
Apparels - High Involvement - Socially visible
• Complex and expensive purchases are likely to involve more
buyer deliberation and more participants.
Different types of Buyers.
• Ones who know exactly what they want.
•Visitors who some what know what they want.
• The window shoppers,
• Non-Prospects
Experts have suggested FOUR types of buying behaviours which depend on
involvement a consumer has with the product and differentiation offered by
the organization.
High involvement:- when the consumer is highly involved while
buying a product. Generally this situation happens in case of expensive
or luxury goods.
Low involvement:- when the consumer is not highly involved while buying a
product. It happens in case of low price goods.
Significant differences between brands:- when there are significant
differences between brands.
Few differences between brands:- it means when there are very little
differences between brands.
Types of Buying Behaviours
High Involvement Low Involvement
Significant Differences
Between Brands Complex Buying Variety Seeking
Behaviour Buying Behaviour
Dissonance
Few Differences Reducing Buying Habitual Buying
Between Brands
Behaviour Behaviour
Complex Buying Behaviour
Complex buying behaviour:- when the consumer is highly involved in
the buying and there is significant differences between brands then it is
called complex buying behavior.
Consumer makes cautious efforts to collect sufficient information about
the product features through various sources (advertisements, internet,
reference groups).
Organisations must provide detailed information regarding the product
attributes/ benefits/Value proposition they offer through various
sources.
For eg. Consumer while buying a motor cycle is highly involved in the
purchase and has the knowledge about significant differences between
brands.
Variety Seeking Buying Behaviour
Variety seeking behaviour:- in this case consumer involvement is low
while buying the product but there are significant differences between
brands.
Consumers generally buy different products not due to dissatisfaction
from the earlier product but in order to seek variety.
Like every time they may buy different flavours of snacks/ fragrances/
styles/ designs etc. to break monotony.
Organizations should ensure to retain consumers by way of introducing
complete product lines like - oral care solutions (Tooth paste,
mouthwash/ tooth brush)/ skin care solutions.
Organizations continuously launch new variety in same product category
(Line extension) or they also launch new products in new related
product categories with the same brand name (Brand extension)
Dissonance Reducing Buying Behaviour
Dissonance buying behavior:- Consumer is highly involved in the
purchase but there are few differences between brands.
Dissonance is anxiety or conflict of pre or post purchase decision.
Consumers many times are unsure about their purchase decision
organisations in such cases should pass on relevant information through all
possible marketing communication channels to reduce pre-purchase
dissonance
Similarly in order to reduce post purchase dissonance they should repeatedly
advertise and ensure to have robust Customer Relationship.
Habitual Buying Behaviour
Habitual buying behavior:- in this case there is low involvement of the
consumer and there are few differences between brands.
The consumer buys the product quickly without making information search
or making extra effort to travel to a specific location/ waiting for the
availability. There is no strong attitudes for any brand.
They buy brands because -
1.They have been using that brand for extended period of time thus being
familiar with the brand
2. There is only a particular brand available in their neighbourhood
conveniently.
Organizations must ensure availability of their products from where
consumers generally buy the product.
They should be having a widespread distribution network.
