THE CHANGING BEHAVIOR OF CONSUMERS IN

RETAILING
Modern Distribution has suffered various changes in the last eras in terms of the stores design and variety
of offers (products, services and brands) and price schemes. It is one of the zone with the highest rate of
hire significantly contributing to the national GDP and a mature market with a increasing number of
individuals gradually informed and very demanding, able to gather different information about products
and services and aware of the need to save money but keen for brands that wonders them.
With the evolution of the digital mediums, consumers are becoming increasingly stylish, connected and
have high expectations of the retail experience. Online retail is now surrounded in consumers behavior
and will force changes to the traditional retail operative mode, those retailers that do not transfer to the
new model will not continue. Good shopping experiences, both in online and offline stores, lead to
satisfaction that leads to promise and, therefore, rises the chance for the customer to become Loyal (and
recommend the online and off line store to their closest contacts).

Factors affecting consumer behaviour

i.

Cultural factors

Cultural factors have come from the different components related to culture or cultural environment from
which the customer belongs.
1. Culture and societal culture:
Culture is important when it comes to understand the needs and behaviors of an individual. Throughout
his existence an individual will be influenced by his family or his friends and his cultural environment
and society that will teach him values and preferences as well as shared behaviors to their own culture.
For a brand, it is important to understand and take into account the cultural factors inherent to each
market or to each situation in order to adapt its product and its marketing tactic. As these will play a role
in the perception, habits and behavior or expectations of consumers. For example, McDonalds is a
brilliant example of adaptation to the specificities of each culture and each market. Very well aware of
the importance to have an offer with specific products to meet the needs and tastes of consumers from
different cultures, the fast-food giant has for example. All the materials used by McDonalds in Arabic
and Muslim countries are certified halal. The fast food chain has not offering any product with bacon and
pork.
2. Sub-culture:

A society is composed of a number of sub-cultures in which people can find. Subcultures are groups of
people who share the same values based on a common experience and similar lifestyle in general.
Subcultures are the nationalities, religion sand ethnic groups, age groups and gender of the individual etc.
The subcultures are often considered by the brands for the splitting up of a market in order to adapt a
product or a communication strategy to the values or the specific desires of this segment. For example in
recent years the segment of ethnic cosmetics has greatly extended. These are products more suited to
non-Caucasian peoples and to types of skin pigmentation for African, Arab or Indian peoples for example.

ii.

Social factors

Social factors are among the factors influencing customer behavior significantly. They are as follows:

1. Reference groups and memberships groups:

The membership groups of an every individual are social groups to which they belongs and which will
influence them. The membership groups are usually associated to its social origin, age and place of
residence, work, hobbies and leisure, etc. Mostly, reference groups are defined as those that offer to the
individual some points of contrast more or less direct about his behavior, lifestyle, desires and consumer
habits. So they influence the image that the individual has himself as well as his behavior. Whether it is
membership group or non-membership group.

2. Family:
The family is may be the most influencing factor for every individual. It create an environment of
socialization in which an individual will change, will shape his personality and attain values. But also
develop attitudes and opinions on several subjects such as politics, society and social relations or himself
and his needs. But also on his customer habits his perception of brands and the products he purchase. We
all kept for several of us and for some products and brands, the same purchasing habits and consumption
patterns that the ones we had known in our family. For example if you have never drunk Coke during
your babyhood and your parents have defined it as a product full of sugar and not good for health. There
is very less chance that you are going to purchase it when you will grow up that someone who drinks
Coke since childhood.

iii.

Personal factors

Decisions and purchasing behavior are obviously also influenced by the characteristics of each customer.

1. Age and way of life:

A buyer does not buy the same products or services at the age of 20 or 70 years. The lifestyle, values, and
environment, activities, hobbies and customer habits change throughout his life.
For example during the life, a customer could change his diet from unhealthy products to a healthier diet
and during mid-life with family earlier needing to follow a little later a low cholesterol diet to elude
health problems.

2. Purchasing power and revenue:

The buying power of an individual will have of course, a significant influence on his behavior and buying
decisions based on his income and his capital. This obviously affects what he can afford and his
perspective on money and the level of importance of price in his buying decisions. But it also plays a role
in the kind of retailers where he goes or the kind of brands he purchase. As for social status, some
customers may also look for the social value of products they purchase in order to show external
indications of their incomes and their level of buying power.

3. Lifestyle:
The lifestyle of an individual comprises all of its activities, interests, values and opinions. The lifestyle of
a customer will influence on his behavior and buying decisions. For example a customer with a healthy
and balanced lifestyle will select to eat organic products and go to specific grocery stores, will do some
jogging regularly (and therefore will purchase shoes, clothes and specific products) etc.

iv.

Psychological factors

Among the factors the factors influencing customer behavior, psychological factors can be divided into
various categories such as motivation, perception and learning.

1. Motivation:
Motivation is what will drive customers to develop a buying behavior. It is the expression of a want is
which became pressing enough to lead the customer want to satisfy it. It is generally working at a
subconscious level and is quite difficult to measure.
2. Learning:

Learning is done through action. When we act and we learn. It indicates a change in the behavior resulting
from the experience. The learning changes the performance of an individual as he obtains information and
experience. For example you are sick after drinking milk, you have a bad experience, you associate the
milk with this state of discomfort and you learn that you should not drink milk. Therefore, you will not
buy milk anymore.

3. Perception:
Perception is the way through which an individual chooses, organizes and then interprets the
information which he receives in order to do something that makes sense. The perception of a
condition at a given time may decide if and how the consumer will act.

1. Buying Behaviour
Although we are living an economic crisis and there is no disbelief that this atmosphere is shifting
buying behaviors, there are still chances for the new distribution players because the consumers will last
to evolve and modern distribution should evolve with them (Gibson, 2012).Considerate the current
market in its several areas of trade must go outside studying the economic process to accepting marketing
strategies that involves producing and distributing consumer goods or services .The consumer has played
such a vital role in the market since the 1950s that science, such as sociology, anthropology, economy,
sociology and management have been studying him companies try to define the right planning
approaches, using market research and studys results to create positive relationships with consumers, as
they wish to satisfy their needs and desires. Hawkins and Coney (2001) state that the consumer behavior
is the study of people, sets of people and societies and the processes that are created for selecting,
attaining, using and classifying consumer goods and services, encouraging ideas and experiences that
please their desires and wants; it also studies the effect of these processes both in public and in private
ingesting. Other authors are inclined to find the study of consumer behavior as the set of physical and
intellectual activities played out by consumers as a result of their decisions, the manner in which they
pursue, pick, buy and use products and services to satisfy a latent need (Ehrenber et al1990, Engel 1884).
According to Morrison (2009), consumer behavior is built on the consumers decisions that outcome from
the acquirement and use of the products and services. Churchill and Peter (2000) protect that the decision
making processes is composed by several factors that affect the final buying choice; the social influencing
factors (Culture, Sub-culture, Social class, Reference groups and Family), the marketing influencing
factors (Price, Product, Promotion and Placement) and the situational influencing factors (physical
atmosphere, social atmosphere, weather, nature of the job and individuals physical situation). Inspiration
is another factor for several authors; Shank (2002) said that motivation is an internal force that draws the
consumer behavior towards the satisfaction of wants. To make a purchase the consumer uses motivation
to satisfy a need that was generated from desire. According to Engel et al (1990) motivation is where
ingesting starts, where it all arises, with the acknowledgement of a need. In fact, motivation is energetic
factor that is always fluctuating because once a previous set of needs are fulfilled, new ones arise. What
outcomes consensual is the fact that the consumer buying process is understood as learning, information
processing and decision making activity, divided in numerous subsequent steps: problematic
identification, info research, substitutions evaluation, purchasing decision and post-purchase behavior

(Bettman1979, Dibb et al 2001, Jobber 2001, Boyd et al 2002, Kotler1997, and Brassington & Petit
2003). For every company it is very essential to detect the elements on this decision process, to identify
the changes occurring in the persons over the time and to prepare suitable answers, in the form of
products or services (Rousseau2008, Faria et al 2012).
When a consumer is buying a definite product class for the first time he lacks experience; he doesnt have
a set of decision mediators to help him make the right choice. In order to collect all the material he needs,
he keenly searches for information in profitmaking and social environments (Faria et al 2012).
1.1 Choosing Point of sale
The physical point sale continues to play a key and strategic role, being one of the main idea of contact
between the brands and the consumers. Various individuals visit and circulate through the commercial
spaces without really purchasing anything; while few just want to enjoy the spaces, pass time, socialize,
be intelligently stimulated, entertain or simply replication an earlier experience, and few choose to delay
their buying because they could not find all they need or simply because they select to delay their
purchases because they like the ability to have a look and touch items before purchasing them (Johansson
2006, Milliward Brown 2010). According to study shows that 97% of the Portuguese consumers use the
internet to hunt for goods and 78% end up by purchasing online. Books and magazines home-based goods
and art and decoration were the most purchased products trips, clothes and accessories, holidays and show
tickets are the most hunted (Oliveira, 2012). it is important to understand that the Portuguese consumer is
following to different technologies and platforms available to buy, due to a considerable number of
factors- easy access to internet, Smartphones, Laptops and Tablets with a lower price and also the brands
capacities to converse through the internet, in fact 51% of the respondents said that internet really helps
them to make the wise decisions about the products and services to purchase. At that time only
understanding the need to save money the consumers look at the internet as a possible way to elude
picking situations (Oliveira 2012).
1.2 Cross Channel Strategy
Nowadays most of the companies use to distribute products and services via different channels
a multi-channel strategy, along with physical stores there are also online stores and e-commerce portals.
Cross channel retailing is at a turning point but with a recognizable extent of progress since it started only
five or six years ago. This strategy purposes to answer a growing use of internet and different
technologies and leads consumers to switch between the two channels during the buying process - the so
called new phenomenon: Research Online and Purchase Offline. The ROPO behavior can be classified in
two directions.
1- The buying process starts online with research and with real acquisition taking place offline
(ROPO A).
2- The research and try in a physical store and the subsequent buying in the Internet (ROPO B).
Now the current consumer studies point out that at times over 50% of the target group scan, research and
compare info online before they finally buying at the local store this seems to encourage retailers to hold
cross channel strategy, giving consumers the chance to research and know the products they offer before
buying them.
2. Satisfaction
Customer satisfaction is both about regarding consuming a product (goods and services) or idea (postpurchase stage) as well as all that takes place prior to the buying (Dubois 2003, Ferreira et al 2011) it is a

temporary feeling, one can feel satisfied with a products performance a service and an attendance action
(Lovelock 2001).According to Kotler (2000 p.58) satisfaction is the sense of pleasure or dissatisfaction
resulting from comparing the performance of a product observed in relation to the consumers
expectation. It is important to consider satisfaction as an essential goal for companies because it is the
mean to get and retain clients (Alves 2003) recent authors have referred that satisfaction should be the
ultimate reason to explain all customer behavior (Ferreira et al 2011and Kotler et al 2011). Moreover the
mere buyer satisfaction is not enough to attract them now a days it takes more than to merely satisfy you
need to delight them (Mittal 2008).When a company begins its activity, it usually has no customer
portfolio their hard work should focus completely on attracting new consumers. In firms that have been in
the market for some time, generally the number of conquered customers is greater than those they need to
attract. This means that the effort towards client retention should be greater than the effort to attract new
consumers (Kotler 1997). Unfortunately firms dedicate themselves largely on conquering fresh consumers
and give little attention to consumer retention and to apply efforts in order to launch a stronger relation
with their actual or current customers, Companies spend 70% of their marketing budgets on acquiring
new consumers while 90% of revenues result from current consumers (Kotler 1997 p.26). The basic norm
should be the reverse because the market share is a reflective indicator while consumer satisfaction is a
prospective indicator. It is a clear indicator of a close relationship with customers and thorough
understanding of their actions and needs expecting them and proactively presenting solutions instead of
presenting problems and doubts. The idea that is consensually accepted is that highly satisfied consumers
are less likely to shift suppliers and act as advocates and as the firms prescribers increasing its
importance in the market and causing more people or organizations to approach them and become fresh
clients (Kotler1997).Satisfaction allows the customer to gain confidence and start a loyal relationship. It
is also an important principle that customers should be loyal to a brand, making repeat purchases and
establishing a warm relations with it. This relationship will allow managers to measure the clients
affection and sensitivity towards the brand. Never the less successful firms and brands are the ones that
attain more than their purchasers satisfaction (meet your customers needs). They manage to surprise
them give them more than they expected to have (Kotler & Armstrong 2006, Mittal et al 2008, Silva
2009, Ferreira et al 2011) and further more help them feel that they have collected all the information
needed to confirm a proper decision (Pires &Santos 1996, Azjen 2001, Foxall 2003 Kotler & Armstrong
2006, Mattei et al 2006) in terms of product and services and points of sale.
3. Commitment
Commitment corresponds to psychological and emotional involvement established with a brand before
the consumer is able to define that the repeat buying behavior results from a sense of loyalty (Vieira
2011). According to many authors different motivations can be found behind the desire to remain and
therefore, different kinds of relations are maintained with a brand affective and calculated. That is why
Vieira and Baptista (2007) have stated that in a complementary way the existence of different types of
commitment calculated and defining it as the individuals connection to a brand (product, service and
point of sale company) based on the perceived costs related with a decision to drop (exit cost) and
affecting and defining it as a sense of desire and well-being also one should feel to stay in relationship
with a brand product, service and point of sale organization (Faria 2012). The commitment does not
appear straightway hence it is built through a relationship that develops between both parties. The authors
general opinion is that customers commitment is only related to the salesperson and service provide. A
high level of assurance is a powerful emotional barrier in changing customer behavior in respect to the
shift of brand or product.

4. Loyalty
The first step towards consumer loyalty is consumer satisfaction and several times erroneous for loyalty
itself satisfaction is happened by a repeat buying behavior and loyalty is materialized prior to the
purchasing decision process so loyalty materializes in intention or willingness to repeat an acquisition.
According to Reich heled (1996) there are two types of loyalty- consumers who are loyal to the point of
sale (the customer knows in which point of sale their favorite products or brands can be found and there is
low risk involved) and the consumer that is loyal to the brand (when the consumer has already bought and
knows what to expect then the risk is automatically reduced) being loyal to a brand is revealed in the
consumers action of purchasing a specific product or brand. Seth and Sobel (2001) also mention two
types of loyalty- loyalty behavior and loyalty attitudes. There is loyalty behavior when the consumer repurchases and which indicates that the consumer is satisfied with the product. Loyalty attitude exists
when the consumers motivation to buy a companys product is handiness or force of habit. The authors
said that this type of loyalty builds unstable relationships and if rivals offer better conditions this buyer
will not be immune.

Changes in Consumer
1. With the growing use of the internet and the continuous adoption for new technology a
considerable number of individuals start enjoying to buying online and as a consequence,
become satisfied, also developing a sense of commitment and loyalty.
2. Despite the increasing use of internet and the continuous adoption of new technology it is
expected that a considerable number of individuals still have a preference to go for shopping
in physical stores and wanting to have direct interaction with the products and peoples and,
though, feeling satisfied, committed and loyal.
3. Number of individuals have a preference market players that enable them to collect
information and decide on the completion of the purchase in online and offline stores.

Conclusion
As a new technique for doing business one can say that e-commerce has changed the way customers
purchase goods and services in a diary basis, with that tendency to rise, in a part due to the actual crisis
situation and the need to save money (which lead the individual to consider the costs related to travelling
through different stores in order to collect information and get the best prices and promotions), consumers
are getting used to shop in an online store instead of going to a physical one (Wen et al, 2011)
If we compare the traditional stores the offline and face-to-face commerce model the online option
presents some advantages such as products and services specially selected to be sell online (not available
in offline stores) so plenty of detailed information and advices and specially no temporal or spatial
limitations. In fact it is undisputable that the shopping environment is changing and we are now starting
to face an increasingly mature channel and easy to manage also secure to use and with very interesting
and appellative layouts which really satisfy the consumers and make them wish to return.
It seems very important that according to the study, that retail players consider the fact of having both off
and online stores if they really need to keep their customers and conquer potential ones. Online consumer
retention it is in fact, a warm issue in both IT and the marketing areas. What are the key factors that can
not only satisfy the consumer but exceed his or her expectations and leading to the intention to purchase?
What kind of promotional actions to develop so that people shall use both channels and in this way can

achieve a win-win perspective? This cross-channel plan may become one differentiation factor in a sector
that has been struggling essentially based on price and promotions

Reference
http://www.academia.edu/
http://google.com

Submitted by
KAMRAN KHAN
SMBA 13025
SEC-A