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Consumer Behaviour

Assignment - A
Question 1: Define consumer behavior.
consumer buying decision process?
Explain briefly the
Answer: Consumer behavior can be defined as a psychological
process that a person goes though in recognizing needs, finding to
solve those needs, making purchase decisions, interpret information,
make plans on how to buy and finally buying the product. It can also
be said that consumer behavior is a study of individuals, groups, or
organizations and the process they use to select, secure, use and
dispose of products and services to satisfy the needs and the impact
that these processes have on the consumer and the society. This
behavior is often associated with a need and can be satisfied by a
tangible item or service.
The consumer buying process starts when a consumer has a problem,
wherein they now search for information on products or services that
can help solve the situation. They (consumers) try to internalize on
what information are needed and sort them accordingly. External
source of information is also used to look for items or services.
Mediums can be the following: Internet, radio, TV, newspapers or
magazines.
The selection process follows wherein the customer has tried and
looked for several viable items that can help resolve the problem. It is
in this stage that the consumer tries to rationalize which item or
service is the most applicable and useful to the current situation. Once
a product is selected, the consumer has now moved on the purchase
decision. It is in this stage that the consumer will actually buy the
selected product either thru cash or via credit cards.
Question 2: What do you mean by post purchase behavior?
Explain this with the help of suitable examples.
Answer: Post-purchase behavior involves all the consumers' activities
and the experiences that follow the purchase. Usually, after making a
purchase, consumers experience post-purchase dissonance. In other
words, they regret their purchase decision. The reasons for high post-

purchase dissonance can be attractiveness and performance of forgone


alternatives, difficult purchase decision, large number of alternatives,
etc.
A high level of post-purchase dissonance is negatively related to the
level of satisfaction the consumer draws out of product usage. While
experiencing post-purchase dissonance, consumers become acutely
aware of the marketers' communication. To reduce post-purchase
dissonance, consumers may sometimes even return or exchange the
product.
Another way of defining post purchase behavior is that after buying
the product, the consumer will now evaluate and compare it with
his/her expectations. This may lead to product satisfaction or
dissatisfaction. If the consumer is not satisfied with the product this is
known as cognitive dissonance.
One good example of post purchase behavior is when an online gamer
bought an electronic item in-game and paid for with real money. The
term for this transaction is known as real money trading. As the online
gamer pays for the item which by the way is not tangible in any way,
he receives the item and starts to use it online. He will feel satisfied of
his purchase but later on will think that what he paid for the nontangible item
can also be used to buy food or another tangible item.
Post purchase behavior is also a factor that helps a consumer
determine if he / she will buy the same product or look for other
alternatives. In the marketing point of view, getting feedbacks from
customers regarding their purchases can help a lot in coming up with
plans to either exploit the product due to popularity or improve things
to make it more saleable.
Question 3: What are the environmental factors influencing
buyer behavior? Explain the reference group with the help of
suitable examples.
Answer: Below are some of the environmental factors that influence
buyers behavior.
1. Culture plays a big role on how a consumer selects a product or
brand to satisfy their needs or wants. These are influences that are
imposed on the consumer by other individuals or by the
community.

2. Locality there are some consumers who are limiting their buying
behavior on their location. Competitor products may be available
for purchase but are located outside of their comfort zones are
often not patronized.
3. Family similar to culture, the family has great influence on the
buyers behavior as deciding on what to buy or what to get has to
coincide if its acceptable to the family.
4. Social class some products may be readily purchased by all
classes and there are some which are above the buying capability.
It can also be interpreted that some social class does not patronize
products belonging to another class.
5. Past experience in some cases wherein the product purchased did
not meet the expectations of the consumer, they will not buy the
same product again.
6. Lifestyle buying items or service depends on the current lifestyle
of the buyer as this will definitely come into play if for example
buyer only has limited means then they will opted to buy cheaper
items rather than regular or expensive ones.
7. Gender Typically, product purchases as based on gender
decisions have an impact on items being offered. Different buying
mindsets for the man and woman leads to different product
preferences despite similar in effect.
8. Reference groups Some consumers buy the products they need
or want based on the perceptions and experiences of others. They
often employ the bandwagon method wherein if everyone says its
good, it probably is. The consumer tries to do some research or
coordinate with different reference group to get feedback on the
product and if they are satisfied with it.
Question 4: Explain the concept of motivation in the consumer
behavior with the help of suitable examples.
Answer: Motivation is the inner drive that reflects goal-directed
arousal. In consumer behavior context, the result is desire for a
product, service, or experience. It is the drive to satisfy needs and
wants, both physiological and psychological, thru purchase and use of
products and services. Motivation in consumer behavior is often
associated with Maslows Hierarchy of Needs. It is in this concept that
there is a presence of a need that has to be satisfied by either a
tangible item or service. It also identifies types of needs which are the
following: Physiological, Safety, Love and belongingness, Esteem and
Self Actualization.

Motivation can also be defined as what stimulates all human behavior.


The process of motivation is initiated by the tension an unsatisfied
want creates. An individual makes all possible efforts to reduce that
tension. The needs or motives which are at the root of the motivation
process are of different types. Physiological needs or primary needs
include the need for air, water, food, clothing, shelter and sex, while
psychological or secondary needs include the need for affection,
status, security, etc. Needs could be positive, negative, utilitarian or
hedonic, conscious or unconscious, and accordingly goals are
formulated. A person has many goals and these goals are never
ending and a failure to satisfy them sometimes leads to frustration. A
person can deal with this by targeting substitute or related goals or by
building a defense mechanism such as aggression, rationalization,
regression and withdrawal.
A lot of consumer choices are tied with motivation as this is one factor
that they rely on to either purchase a product or not. Basing on a
specific need, the consumer will now look for a way to satisfy this
need. It could be buying a specific product or availing of a service.
Either way, the consumer is motivated to do something to meet
his/her needs.
Question 5: Write short notes on the following.
Answer 5c: Short Notes on: Primary Vs. Secondary Reference
Groups
Primary Vs. Secondary Reference Groups Primary groups are small
social groups whose members have close relationships with. They tend
to share everything to each other showing concern for one another.
This is a type of group that influences the identity of a person and how
it perceives a product or an item in a buyers point of view. The
primary groups can be your family, close friends and influential social
groups. Secondary reference groups on the other hand are established
to complement the primary groups. They are the alternative sources of
information and feedback that also can influence a persons buying
behavior.
Answer 5d: Short Notes on: The Family Life Cycle Concept

The Family Life Cycle Concept is a model that attempts to describe


the effect of time on a family through the phases of marriage, birth
and deaths reflected in the familys income and consumption. Key
variables of the concept are the following: Age, Marital Status, Career,
Disposable Income, Presence or absence of children.
Answer 5e: Short Notes on: Organizational Buying Behavior
Organizational Buying Behavior is a type of buying behavior wherein
buying of items or products is done for resale to other consumers. A
good example of this method is wholesaling. A store owner can buy
bulk items at a lesser price and sell them for a little profit in their
community.

Assignment - B
Question 1: Explain the Cognitive Learning Theory with the
help of suitable examples.
Answer: Cognitive Learning Theory attempts to explain human
behaviour by understanding the thought processes. The assumption
is that humans are logical beings that make the choices that make
the most sense to them. Information processing is a commonly
used description of the mental process, comparing the human mind
to a computer.
It can also be explained that we actively learn when we make an
effort to organize, store and finding the relationship between old
and new information, scripts and schema. To simplify things,
Cognitive Learning Theory is about how information is processed by
the mind.
A good example of this concept is when a child interacts with
his/her environment. As the child interacts he/she undergoes two
processes: Assimilation and Accommodation. In Assimilation, the
child interacts with an object or event in a way that is consistent
with an existing scheme. Accommodation is where the child tries to
modify an existing scheme or forms a new one to account for a new
event. In other words, people assimilate new experiences by
relating them to things they already know. On the other hand,
accommodation is what happens when the schema itself changes to
accommodate new knowledge. According to Piaget, cognitive
development involves an ongoing attempt to achieve a balance
between
assimilation
and
accommodation
that
he
termed equilibration.
People are intrinsically motivated to try to make sense of the world
around them. According to this view, people are sometimes in the
state of equilibrium, they can comfortably explain new events in
terms of their existing schemes. However at times they can
encounter events they cannot explain our make sense of this is
called disequilibrium, a mental discomfort. Through reorganizing
thought people are able to then understand the previously ununderstandable and r
eturn to equilibrium.

Question 2 a) What are attitudes?


strategies of attitude change.
Discuss briefly the
Answer: Attitudes are an individuals concept that represents his like
or dislike for a particular event, item or individual. These can also be
positive or negative attitudes which primarily are judgments of an
individual towards its fellow or a view point.
Attitudes can be changed through persuasion and we should
understand how attitude change as a response to communication. In a
marketing point of view, the strategies that involved in changing
attitudes start by changing the consumers basic motivational function.
Associating a product with an influential group, personality or event
can help motivate attitude change. As people like to associate things
they buy with famous people does help in altering their attitude
towards a product. Altering components of the model will lead to
innovation and the product being unique. This strategy will make the
organization more visible because people or consumers like variety in
their products. The last strategy is changing the consumers beliefs
about competitors brand. This is somewhat difficult as most
consumers are considered to be brand loyal. Changing their beliefs in
their brand will result to loss of trust and possibly shift to our direction.
Question 2b) Explain the influences of reference groups on
products and brands with the help of suitable examples.
Answer: Almost all consumers are social people as such their
reference groups play an important role in buyer behavior of a
particular product or brand. This goes well for both primary and
secondary reference groups. Reference groups have members who
have tried different brands for a specific purpose. Their experiences on
using the product are then cascaded to the group. They start to form
their product and brand preference once all members were able to give
their feedback. This same goes for primary groups whose close ties
with each other gives them an advantage as the atmosphere generally
centers on caring for each member.
Buyers tend to decide on how the item was perceived by either his
peers or friends. Only a small percentage of buyers usually patronize a
product that does not sit well with his reference groups.

When buying a toothpaste, a mans reference group is leaning towards


Colgate this goes the same for the mans family. In the end, the man
will buy Colgate as this was already proven as a good product both by
his peers and family.
Question 3: Why a researcher should prefer to use focus groups
rather than depth interview? When depth interview are
preferable?
Answer: Using focus groups to determine marketability or sales
interest in a product is more preferable because in focus groups, the
organization has complete control on how to choose their participants.
If they choose only young men to participate in an FGD about a
shaving cream, they can get immediate feedback from it. You can also
get an average feel of how the product will be patronized as based on
their feedback and observations.
In depth interviews are more of getting information on how a person
thinks about a certain procedure and not the product itself. Although
discussed during the interview, bias is always present and is often
hard to determine actual response regarding a particular product.
What 1 item is good for this person may be bad for the other.
Feedbacks and data can be gathered faster when using FGDs for a
product or item.

Case Study
New Customer - Information Needs
A customer, new to the bank, walks in through the door and looks around for
the most likely place to open a new account. There are two customer service
representatives (CSR) in the room, and neither of them has a customer at
the desk. The one nearest to the door is on phone, and the one behind him
has her head down, apparently buried in her work. No one looks up in the
direction of the customer.
The customer, Mrs. Benjamin, moves within view of the customer service
representative at the first desk. He continues talking, obviously completing a
personal phone call, without looking up. After several seconds, he says, "l ve
got to go. I ve got a customer." He hangs up and looks up, saying, "May I
help you? Mrs. Benjamin takes a seat on her own initiative and tells him that
she wants to open a current account. The CSR reaches for the signature card
and service brochure and starts quoting the monthly balance requirement to
avoid a service charge on a regular current account.
Mrs. Benjamin changes direction entirely and indicates her particular interest
in "something that offers an overdraft line of credit ... does the bank offers
anything...?.Clipping her last question, the CSR refers automatically to the
cash reserve account and says that it s something customers have to qualify
for. He informs Mrs. Benjamin that she ll have to fill out a credit application
and the bank will probably start her off with a Rs. 25,000 line and see how
she manages it. Then, after a while she can request an increase if she wants.
He asks the necessary questions and completes the paperwork to open the
current account and hands her the cash reserve application, telling her that
she can mail it back or drop it off next time she s in the bank. He asks her if
she wants an ATM card. She says no, and that s the end of that discussion.
She selects her check style, gives him her opening deposit, and finishes the
transaction. As Mrs. Benjamin leaves the bank, she wonders if everyone who
works for the bank is as poor in human relations skills as this CSR. She also
wonders if she made a mistake by not just walking out after being told, in
essence, that she might not be a good enough customer to qualify for more
than Rs. 25,000 of the bank s credit. Well, anyway, she s stuck with them
now - for a while at least. She ll wait and see how it goes over the next few
months, and she thinks to herself, "If I m still not comfortable with the bank,
I ll shop around and move my account to a bank where the people treat you
as if you really matter to them."
Questions:
Question a: The case presents a pre-purchase information
search situation. How well has the bank fulfilled the
informational needs of the customer?

Answer: The bank thru its CSR provided information pertaining to


opening an account and other types of transactions. The CSR was
straightforward in dealing with Mrs. Benjamin as he explained
procedures and other processes relating to her inquiries. One problem
that I observed in this case study is the lack of providing rapport with
the customer. Even though the process as explained carefully. The
CSR was not too accommodating with Mrs. Benjamin. He acted sort of
like a robot as he explained and handed out the forms.
Customer service as the name implies are there to make people
comfortable with their initial search for a service. It is not enough that
we CSRs can provide all the technical information regarding the
product they should be more approachable and show importance to
the customer. Since a customer doesnt purchase a product or avail of
a service just for the technical side of it. They combined this with how
they perceived the item and how they are satisfied with it.
On a technical side, the bank was able to provide the needed
information and forms to Mrs. Benjamin. On the aspect of providing
customer satisfaction they fell behind. As at the end of the case study,
Mrs. Benjamin has already doubts about her transaction with the bank
because of the poor service provided by the CSR. She now has a
conflict in herself if she wants to continue doing business with the
bank or take her money and select another bank.
Question b: How is the above interaction likely to affect the
customer s perception of the bank?
Answer: It has affected the customer already because as Mrs.
Benjamin was leaving the bank, she has doubts if the bank and its
employees have good customer relations. She felt that she was not
treated properly and that as a customer, she and others like her
provide the business to which a bank needs.
Mrs. Benjamin also felt that because she was a bit forward in getting
the attention of the CSR, she was given a small credit line, to which
she thinks she should get more. She also had this feeling that she was
not accorded the proper respect that she expected as a customer of
the bank. The manner by which the CSR afforded her during the entire
transaction was not very pleasing and bordering on him being irritated
by Mrs. Benjamins interruption of his call. Further, Mrs. Benjamin felt
like a second rate citizen because of the service she got from the CSR.
Question c: What is the marketing implication of the above
interaction?

Answer: If this trend of customer service is left unchecked, the bank


may stand to lose more customers. Without customers or depositors,
the bank suffers and in the end may close due to lack of funds.
Marketing the bank to reach out new customers will be difficult as
some people who had dismal experience will say negative things about
the bank to their families and friends. This would make the other
members of the family and their friends talk to other circles and the
bank will suffer negative publicity. Culture and family play important
roles in many of todays consumer decision making. They influence a
persons mindset about a particular service or product and if they do
not approve of it, the person most probably will not patronize it.
Question d: How would you advise the bank in terms of
fulfilling the informational needs of customers?
Answer: I would suggest to the bank officers to have their CSRs
undergo customer service training so that they will be aware that
providing service to customers is not mainly on providing information
or details of a particular product but making them comfortable and
ensure that their emotional needs are addressed as well.
Maintaining good customer relations is vital to keeping loyal customers
and enticing new ones to come and invest in the bank. This is one
aspect; I think the bank needs to work on at the soonest possible
time.
Informational need is a customers desire to locate and obtain
information to satisfy both conscious and unconscious needs. This
should be the top priority of the bank as this brings in more business
to their establishment. It is generally not enough to satisfy the
conscious need, the unconscious one has to be satiated also. In the
case of Mrs. Benjamin, the conscious informational needs were
addressed but the unconscious ones were not. This lead to a conflict in
the decision making process of Mrs. Benjamin whether to continue
with the bank or look for other banks.
.

Assignment - C
1.
The person who determines that some need or want is not being met is-a)
b)
c)
d)
2.
Influencer
Initiator
Buyer
User
The person who actually makes the purchase is-a)
b)
c)
d)
3.
Influencer
Initiator
Buyer
User
The five stages of consumer decision process are-a) Problem recognition, informa
tion search, evaluation behaviour, postpurchase behaviour and purchase decision.
b) Problem recognition, purchase decision, evaluation behaviour, satisfaction an
d
re-purchase
c) Problem recognition, post-purchase behaviour, satisfaction, re-purchase and
information research
d) None of the above
4.
The risks that are always at the backend of every customer are-a)
b)
c)
d)
5.
Perceived risks
Normal risks
Abnormal risks
None of the above
__________ factor has broadest and deepest influence on consumer behaviour.
a)
b)
c)
d)
Reference group
Social Class
Culture
Sub-culture

6. Environmental factors that influence the buyer behaviour in the sub-culture


lower, middle and higher is the-a)
b)
c)
d)
7.
Social group aspect
Religious group aspect
Age group aspect
None of the above
The process by which children acquire the skills, knowledge and attitude necessa
ry to
function as consumers is-a)
Consumer socialization

b)
c)
d)
8.
Consumer orientation
Consumer specialization
None of the above
In the organizational buying, the first phase is-a)
b)
c)
d)
9.
Search for and qualification of potential sources
Need recognition
Selection of an order routine
None of the above
Seeking new positive talks about-a)
b)
c)
d)
10.
Information
Information
Information
None of the

about the product purchased


about the sales
about the company
above

__________ provide information to other members.


a)
b)
c)
d)
11.
a)
b)
c)
d)
12.
Gatekeepers
Influencers
Deciders
None of the above
____________ control the flow of information about a product or service in a
family.
Gatekeepers
Influencers
Deciders
None of the above
_______ are having power to take decision.
a)

b)
c)
d)
Gatekeepers
Influencers
Deciders
None of the above
13. ____________ who initiate or carry out disposal or discontinuation of a part
icular
product or service.
a)
b)
c)
d)
14.
Maslows theory postulates ________ basic levels of human needs.
a)
b)
c)
d)
15.
Maintainers
Disposers
Users
None of the above
Five
Four
Three
Two
___________s psychoanalytic theory of personality is the cornerstone of modern
psychology.

a)
b)
c)
d)
16.
In ____________ , the childs primary source of pleasure is the process of elimina
tion
a)
b)
c)
d)
17.
Junior notified doctor
Just Noticeable difference
Just Not done
None of the above
_________ is the stimuli that give direction to the motives.
a)
b)
c)
d)
22.
Perception
Attitude
Information
None of the above
JND stands-a)
b)
c)
d)
21.
Consumerism
Dogmatism
Absenteeism
None of the above
__________ is defined as the process by which an individual selects, organizes,
and
interprets stimuli into a meaningful and coherent picture of the world.
a)
b)
c)
d)
20.
Oral stage
Anal stage
Phallic stage
None of the above

________ is a personality trait that measures the degree of rigidity individual


display
towards the unfamiliar and information that is contrary to its own established b
eliefs.
a)
b)
c)
d)
19.
Oral stage
Anal stage
Phallic stage
None of the above
In ____________ , the infant first experiences social contact with the outside w
orld
through the mouth.
a)
b)
c)
d)
18.
Sigmund Freud
Philip Kotler
Niel Armstrong
None of the above
Response
Reinforcement
Cues
None of the above
Changing the basic motivational function is a-a)
b)
Strategy of attitude change
Strategy of personality change

c)
d)
23.
Strategy of reference group change
None of the above
_________ is closely linked to cultural or group values and involves the sanctio
n of what
ought to or should be done.
a)
b)
c)
d)
24.
In _____________ power consumers accept information from members within a group
whom they perceive to be experts.
a)
b)
c)
d)
25.
Referent power
Legitimate power
Expert power
None of the above
__________ includes individuals who have direct influences on the consumer.
a)
b)
c)
d)
26.
The socialization agents
The commercialization agents
The modern agents
None of the above
The instigator is also known as-a)
b)
c)
d)
27.
The influencer
The initiator
The buyer
None of the above
__________ is someone whose opinion is valued in the decision-making process.
a)
b)

c)
d)
28.
The influencer
The initiator
The buyer
None of the above
This is the person who makes the final purchase-a)
b)
c)
d)
29.
Referent power
Legitimate power
Expert power
None of the above
The influencer
The initiator
The buyer
None of the above
Full nest 1 is-a)
b)
c)
d)
Young, married without child
Young, no children
Young, married with child
None of the above

30.
Full nest 2 is-a)
b)
c)
d)
31.
Full nest 3 is-a)
b)
c)
d)
32.
The upper-middle class
The lower-upper class
The middle class
None of the above
Content analysis, Consumer Fieldwork etc., is the measurement of-a)
b)
c)
d)
37.
Young married with children
Young married without children
Young single
None of the above
Achieving professionals are the-a)
b)
c)
d)
36.
Older, married with no children living with them
Young, married with child
Older, single, retired people
None of the above
From the consumption pattern point of view, in ________ stage of the family life
cycle,
outdoor sporting goods, sports, cars, fashion clothing etc. are consumed.
a)
b)
c)
d)
35.
Older, married with dependent children
Older, married without children
Older, married with no children living with them
None of the above

Solitary Survivors are-a)


b)
c)
d)
34.
Older, married, with dependent children
Older, married with children
Young, no children
None of the above
Empty nest is-a)
b)
c)
d)
33.
Young, married with child
Young, no children
Old, married with children
None of the above
Culture
Attitude
Personality
None of the above
_____________ is the broadest component that has an effect on consumer behaviour
.
a)
b)
Culture
Social class

c)
d)
38.
There are ________ types of cultural values.
a)
b)
c)
d)
39.
Three
Two
Four
Five
Nationality is a ___________ aspect.
a)
b)
c)
d)
40.
Reference groups
None of the above
Cultural
Sub-cultural
Personality
None of the above
There are ________ types of sub-cultures are there.
a)
b)
c)
d)
Three
Four
Five
None