INTRODUCTION

As a consumer we are all unique and this uniqueness is reflected in the consumption pattern and
process purchase. The study of consumer behavior provides us with reasons why consumers differ from
one another in buying using products and services. We receive stimuli from the environment and the
specifics of the marketing strategies of different products and services, and responds to these stimuli in
terms of either buying or not buying product. In between the stage of receiving the stimuli and
responding to it, the consumer goes through the process of making his decision.

Stages of the Consumer Buying Process:

Six Stages to the Consumer Buying Decision Process (For complex decisions). Actual purchasing is only
one stage of the process. Not all decision processes lead to a purchase. All consumer decisions do not
always include all 6 stages, determined by the degree of complexity...discussed next.

The 6 stages are:

1. Problem Recognition--difference between the desired state and the actual condition. Deficit in
assortment of products. Hunger--Food. Hunger stimulates your need to eat.

Can be stimulated by the marketer through product information--did not know you were deficient? I.E.,
see a commercial for a new pair of shoes, stimulates your recognition that you need a new pair of shoes.

2. Information search--

o Internal search, memory.

o External search if you need more information. Friends and relatives (word of mouth). Marketer
dominated sources; comparison shopping; public sources etc.

A successful information search leaves a buyer with possible alternatives, the evoked set.

Hungry, want to go out and eat, evoked set is

o Chinese food

o Indian food

o burger king

3. Evaluation of Alternatives--need to establish criteria for evaluation, features the buyer wants or
does not want. Rank/weight alternatives or resume search. May decide that you want to eat something
spicy, Indian gets highest rank etc. If not satisfied with your choices then return to the search phase. Can
you think of another restaurant? Look in the yellow pages etc. Information from different sources may
be treated differently. Marketers try to influence by "framing" alternatives.
4. Purchase decision--Choose buying alternative, includes product, package, store, method of
purchase etc.

5. Purchase--May differ from decision, time lapse between 4 & 5, product availability.

6. Post-Purchase Evaluation--outcome: Satisfaction or Dissatisfaction. Cognitive Dissonance, have

you made the right decision. This can be reduced by warranties, after sales communication etc.

After eating an Indian meal, may think that really you wanted a Chinese meal instead.

Types of Consumer Buying Behavior

Types of consumer buying behavior are determined by:

• Level of Involvement in purchase decision. Importance and intensity of interest in a product in a

particular situation.

• Buyers level of involvement determines why he/she is motivated to seek information about a
certain products and brands but virtually ignores others.

High involvement purchases--Honda Motorbike, high priced goods, products visible to others, and the
higher the risk the higher the involvement. Types of risk:

• Personal risk

• Social risk

• Economic risk

The four type of consumer buying behavior are:

• Routine Response/Programmed Behavior--Buying low involvement frequently purchased low

cost items; need very little search and decision effort; purchased almost automatically. Examples include
soft drinks, snack foods, milk etc.

• Limited Decision Making--Buying product occasionally. When you need to obtain information
about unfamiliar brand in a familiar product category, perhaps. Requires a moderate amount of time for
information gathering. Examples include Clothes--know product class but not the brand.

• Extensive Decision Making/Complex high involvement, unfamiliar, expensive and/or

infrequently bought products. High degree of economic/performance/psychological risk. Examples
include cars, homes, computers, education. Spend a lot of time seeking information and deciding.

Information from the companies MM; friends and relatives, store personnel etc. Go through all six
stages of the buying process.

• Impulse buying, no conscious planning.

 The purchase of the same product does not always elicit the same Buying Behavior.
Product can shift from one category to the next. For example:

Going out for dinner for one person may be extensive decision making (for someone that does not go
out often at all), but limited decision making for someone else. The reason for the dinner, whether it is
an anniversary celebration, or a meal with a couple of friends will also determine the extent of the
decision making.

Factors Effecting the Consumer Buying Decision Process

A consumer, making a purchase decision will be affected by the following three factors:

1. Cultural and sub culture Factor

2. Social Factor

3. Personal Factor

• Culture and Sub-culture--

Culture refers to the set of values, ideas, and attitudes that are accepted by a homogenous group of
people and transmitted to the next generation.

Culture also determines what is acceptable with product advertising. Culture determines what people
wear, eat, reside and travel. Cultural values in the US are good health, education, individualism and
freedom. In American culture time scarcity is a growing problem that is change in meals. Big impact on
international marketing.

Culture can be divided into subcultures:

o geographic regions

o Human characteristics such as age and ethnic background.

West Coast, teenage and Asian American.

Culture affects what people buy, how they buy and when they buy.

Understanding Consumer Buying Behavior offers consumers greater satisfaction (Utility). We must
assume that the company has adopted the Marketing Concept and are consumer oriented.

Social Factors
Consumer wants, learning, motives etc. are influenced by opinion leaders, person's family, reference
groups, social class and culture.

• Roles and Family Influences--

Role...things you should do based on the expectations of you from your position within a group. People
have many roles.

Husband, father, employer, employee. Individuals role are continuing to change therefore marketers
must continue to update information. Family is the most basic group a person belongs to. Marketers
must understand:

o that many family decisions are made by the family unit

o consumer behavior starts in the family unit

o family roles and preferences are the model for children's future family (can reject/alter/etc)

o family buying decisions are a mixture of family interactions and individual decision making

o Family acts an interpreter of social and cultural values for the individual.

The Family life cycle: families go through stages; each stage creates different consumer demands:

• Reference Groups--

Individual identifies with the group to the extent that he takes on many of the values, attitudes or
behaviors of the group members.

Families, friends, sororities, civic and professional organizations. Any group that has a positive or
negative influence on a persons attitude and behavior.

Membership groups (belong to)

Affinity marketing is focused on the desires of consumers that belong to reference groups. Marketers
get the groups to approve the product and communicate that approval to its members. Credit Cards
etc.!!

Aspiration groups (want to belong to)

Disassociate groups (do not want to belong to)

Honda, tries to disassociate from the "biker" group. The degree to which a reference group will affect a
purchase decision depends on an individuals susceptibility to reference group influence and the strength
of his/her involvement with the group.
• Social Class

An open group of individuals who have similar social rank. US is not a classless society. US criteria;
occupation, education, income, wealth, race, ethnic groups and possessions.

Social class influences many aspects of our lives. i.e; upper middle class Americans prefer luxury cars
Mercedes.

o Upper-upper class, .3%, inherited wealth, aristocratic names.

o Lower-upper class, 1.2%, newer social elite, from current professionals and corporate elite

o Upper-middle class, 12.5%, college graduates, managers and professionals

o Middle class, 32%, average pay white collar workers and blue collar friends

o Working class, 38%, average pay blue collar workers

o Lower class, 9%, working, not on welfare

o Lower-lower class, 7%, on welfare

Social class determines to some extent, the types, quality, and quantity of products that a person buys
or uses.

Lower class people tend to stay close to home when shopping; do not engage in much pre-purchase
information gathering.

Stores project definite class images.

Family, reference groups and social classes are all social influences on consumer behavior. All operate
within a larger culture.

Personal Factor Unique to a particular person. Demographic Factors, Sex, Race, Age etc. Who in the
family is responsible for the decision making? Young people purchase things for different reasons than
older people.

Psychological factors

Psychological factors include:

• Motives-
-A motive is an internal energizing force that orients a person's activities toward satisfying a need or
achieving a goal. Actions are effected by a set of motives, not just one. If marketers can identify motives
then they can better develop a marketing mix.

MASLOW hierarchy of needs!!

o Physiological

o Safety

o Love and Belonging

o Esteem

o Self Actualization

Need to determine what level of the hierarchy the consumers are at to determine what motivates their
purchases. The product was not selling well, and was almost terminated. Upon extensive research it was
determined that the product did sell well in inner-city convenience stores. It was determined that the
consumers for the product were actually drug addicts who couldn't digest a regular meal. They would
purchase Nutriment as a substitute for a meal. Their motivation to purchase was completely different to
the motivation that B-MS had originally thought. These consumers were at the Physiological level of the
hierarchy. BM-S therefore had to redesign its MM to better meet the needs of this target market.

Motives often operate at a subconscious level therefore are difficult to measure.

• Perception—

Perception is the process of selecting, organizing and interpreting information inputs to produce
meaning. IE we chose what info we pay attention to, organize it and interpret it.

Information inputs are the sensations received through sight, taste, hearing, smell and touch.

Selective Exposure-select inputs to be exposed to our awareness. More likely if it is linked to an event,
satisfies current needs, intensity of input changes (sharp price drop).

Selective Distortion-Changing/twisting current received information, inconsistent with beliefs.

Advertisers that use comparative advertisements (pitching one product against another), have to be
very careful that consumers do not distort the facts and perceive that the advertisement was for the
competitor. A current example...MCI and AT&T...do you ever get confused?

Selective Retention-Remember inputs that support beliefs, forgets those that don't.

Average supermarket shopper is exposed to 17,000 products in a shopping visit lasting 30 minutes-60%
of purchases are unplanned. Exposed to 1,500 advertisement per day. Can't be expected to be aware of
all these inputs, and certainly will not retain many.

Interpreting information is based on what is already familiar, on knowledge that is stored in the
memory.

• Ability and Knowledge--

Need to understand individual’s capacity to learn. Learning, changes in a person's behavior caused by
information and experience. Therefore to change consumers' behavior about your product, need to give
them new information re: product...free sample etc.

When making buying decisions, buyers must process information.

Knowledge is the familiarity with the product and expertise. Inexperience buyers often use prices as an
indicator of quality more than those who have knowledge of a product.

Non-alcoholic Beer example: consumers chose the most expensive six-pack, because they assume that
the greater price indicates greater quality.

Learning is the process through which a relatively permanent change in behavior results from the
consequences of past behavior.

• Attitudes--

Knowledge and positive and negative feelings about an object or activity-maybe tangible or
intangible, living or non living.....Drive perceptions

Individual learns attitudes through experience and interaction with other people. Consumer attitudes
toward a firm and its products greatly influence the success or failure of the firm's marketing strategy.

Honda "You meet the nicest people on a Honda", dispel the unsavory image of a motorbike rider, late
1950s. Changing market of the 1990s, baby boomers aging, Hondas market returning to hard core. To
change this they have a new slogan "Come ride with us".

Attitudes and attitude change are influenced by consumer’s personality and lifestyle.

Consumers screen information that conflicts with their attitudes. Distort information to make it
consistent and selectively retain information that reinforces our attitudes. IE brand loyalty.

There is a difference between attitude and intention to buy (ability to buy)

• Personality--
all the internal traits and behaviors that make a person unique, uniqueness arrives from a person's
heredity and personal experience. Examples include:

o Work holism

o Compulsiveness

o Self confidence

o Friendliness

o Adaptability

o Ambitiousness

o Dogmatism

o Authoritarianism

o Introversion

o Extroversion

o Aggressiveness

o Competitiveness.

Traits affect the way people behave. Marketers try to match the store image to the perceived image of
their customers.

There is a weak association between personality and Buying Behavior; this may be due to unreliable
measures. Nike ads. Consumers buy products that are consistent with their self concept.

• Lifestyles--

Recent US trends in lifestyles are a shift towards personal independence and individualism and a
preference for a healthy, natural lifestyle.

Lifestyles are the consistent patterns people follow in their lives.

The marketer must be aware of these factors in order to develop an appropriate MM for its target
market.
1.1 What is Marketing?

Marketing on the one hand is a business philosophy and on the other an action oriented process. The
philosophy - also termed as marketing concept - has its roots in market economy. There are four critical
ideas that form the foundation of such an economy:

• Individuals pursue their self-interest to seek rewarding experience

• Their choices determine as to what would constitute such experience, the choices themselves being
shaped by personal (taste) and external (cultural) influences.

• Consumers enjoy the freedom to choose; they are sovereign.

• This freedom ensures free and competitive exchange between “buyers and sellers”. Marketing in turn
is based on these four principles.

Thus Marketing can be defined as a

‘Process that aims at satisfying individual and organizational needs by creating, offering and exchanging
competitively made products that provide value to the buyers’

Today our focus is on customer. Objectives liken revenue, profit, market share, etc. Re important, but
they will flow only by acquiring customer competence. In our country particularly the customer, even as
late as in 1980s, was bereft of alternatives; he would uncomplainingly buy whatever the seller dished
out. Not any more. Today’s choice empowered customer, supported by a competitive environment,
global quality, and new economic realities, decides the fate of the marketer.

So let’s define Marketing once more: “It is a total business philosophy aimed at identifying the needs of
each customer group, then designing and producing product / service package so as to serve the groups
more effectively than the competitors”.

This definition reveals three key dimensions of marketing:

• It seeks to identify customer needs: Many manufacturers would know all there is to know about
relevant production technology, but nothing about their customers’ wants. They may design products
with fancy features without considering the perceived value of such features to their
buyers. Then they wonder why their sales staff fails to push the product in the market.

Marketing attempts to select customer groups for which it can develop a competitive edge: •
Companies taking a shotgun approach - meaning all things to all people - inevitably end up with sackful
of unsold product inventories.

What is Consumer Buying Behavior?

Definition of Buying Behavior: Buying Behavior is the decision processes and acts of people involved in
buying and using products.

Need to understand:

• Why consumers make the purchases that they make?

• What factors influence consumer purchases?

• Changing factors in our society.

Consumer Buying Behavior refers to the buying behavior of the ultimate consumer. A firm needs to
analyze buying behavior for:

• Buyer’s reactions to a firms marketing strategy has a great impact on the firm’s success.

• The marketing concept stresses that a firm should create a Marketing Mix (MM) that satisfies
(gives utility to) customers, therefore need to analyze the what, where, when and how consumers buy.

Marketers can better predict how consumers will respond to marketing strategies.

NEED OF THE STUDY –

There are different national & international products present in India. So to identify the customer &
their buying behavior have been the focus of a number of international and national product. The result
of these studies have been useful to the provide solution to various marketing problem.

Understanding buying behavior pattern per se is not enough without understanding the composition
and origin of the customer. Today most of the Indian customers are attracted by the imported goods
because of their high quality. So that most of the Indian company product looses their credibility and
loyalty in domestic customers.

So the objectives of the study are –

1. How can we stand out in a highly competitive market where consumer have so many choice?.

2. How we can provide best loyalty to our customer while earning a fair profit?

3. How can we grow our business while retaining a core of the loyal customer?

BACK GROUND: A major area of concern in marketer-consumer relation is the growing influence and
utilization of the credit market, an outcome of compulsive buying, which has negatively affected the

consumers, leading them to unmanageable debt levels. A study to find whether there is any association
of the following variables on compulsive buying viz, big five Personality traits, materialism,
demographics and credit card usage. The research design is a conclusive design which is single cross
sectional descriptive in nature. The primary data was collected using non probability sampling
technique. A quota sample of 120credit card holders (using credit card/s above one year) was chosen.

The respondents in aggregate ‘neither agree nor disagree’ to materialism and have ‘rarely’

compulsive buying. The respondents ‘moderately agree’ that they are high enhanced credit card
spenders, but at the same time they ‘rarely’ indicate compulsive buying, which is a positive outcome.
They ‘disagree’ to high credit card financing behavior, which again exposes to the fact that they ‘spent
and finance their spending’ cautiously, keeping track of mental account4 as a self control device against
environmental factors, like retailing environment, availability of credit and so. Emotional stable
extroverts tend to have a steady spending behaviour and external influences do not impact much, is
true in this study. Twelve percent of respondents have ‘high credit default probability’, with a score
between 5 to 10on the scale.

The emergence of relationship in some cases is as supported by literature from previous studies at the
same time poses a challenge before the researcher to take up complicated models (like

structural equation modeling) to possibly explore a new direction to the nature of relationships.
CHAPTER (II)

RESEARCH METHODOLOGY
 OBJECTIVE OF THE STUDY

The systematic and objective identification, collection, analysis, dissemination, and use information for
the purpose of assisting management in decision making related to the identification and solution of
problem and opportunities in marketing.

When an industry comes in the competitive market then the main

problem comes in front of him is, how can survive in the market. For this purpose they have to know
about their production process, employment process, distribution process, consumer needs and
consumer behavior. The main purpose of the industry is to satisfy the consumer needs. Their all function
rounds around the customer, they try to know the behavior of the customer and fulfill their goal and to
know about the customer’s behavior they do marketing research. In this era the marketing research is
the basic part of the industry. Marketing research include the evaluation of the organization’s all
functions like their production, manufacturing, distribution, marketing , financial and human resources.

We can say it is the internal research of an industry. There are some external factor which affects the
growth of the organization like customer behavior and the political, technological, economical, and legal
environment. And the most important factor is consumer buying behavior because this factor is
responsible for the utilization of the product and ultimately sells of the product. So industry also
needs the research on the consumer buying behavior.

When we do the research on the consumer behavior we should know the entire factor which
affects the consumer buying behavior. Social environment, education, culture and traditions, income,
society are the factors which affect the buying behavior of the consumer. We can also divide it into
geographic, demographic, psychological factor. The main objective of this study are –

To under stand why customer buy a particular product.

To know the marketing opportunities.

To know about customer acceptance of the product.

 To analyse the customer expectation from the manufacturer.

To help the company to know what consumer want in the product.

Why consumer prefer imported goods instead of indigenous goods.

In the marketing research we firstly design our research. Our research can be Descriptive,
explorative and casual research design.

Casual research design is based on survey and observation. In this research process we are selected
descriptive research design.

RESEARCH METHODOLOGY

Research problems: To study buying behavior of consumer for indigenous and imported products.

Data source: Primary data and secondary data

Research approach: Survey approach

Research methodology: Exploratory method

Research Instruments: Questionnaire

 SAMPLING PLAN

Population Definition

Sample: Malls ,Super Mark

Extent: Delhi/NCR

Sample Methods Random Simple Sampling

Sample size 75.

Primary data Questionnaire and Interview

SAMPLE

While deciding about the sample of research, it is required from the researcher’s point to pay attention
to these under mentioned points:

a) Sample Units: A decision has to be taken concerning a sampling unit before selecting a sample,
sampling unit may be a geographical one such as state, district, village Etc. so in this research sampling
unit is Delhi/NCR.

b) Source list: It is also called sampling frame from which sample is to be drawn ,it caters name of
all the items of a universe (in case of finite universe only).Researcher has to prepare it

c) Sampling size: This refers to the no. of items to be selected from the universe to constitute a
sample. This is a major problem before the researcher. The size of sample should neither be excessively
large not too small, it should be optimum. This size of population must be kept in view for this also limits
the sample size .Sample size in this research is 75 customers.

d) Sampling procedure: Finally the researcher must decide the type of sample he must be .That is
he must decide about the technique to be used in selecting items for the sample .In fact this technique
or procedure stands for the sample design itself. In this we used the random sampling on the basis of
first survey results, which is from 75 respondents.

INSTRUMENTS USED

We collected primary data through sample survey or census surveys from the selected elements in
malls and super markets. So for this purpose we have used the most popular tool of primary data
collection through direct communication with respondents. The tools we used are questionnaires.

Source of data: Data required for the study was collected through primary sources i.e. Market Survey.

METHOD OF DATA COLLECTION

Actually data is of two kinds so researchers should keep in mind both types of data.

a) Primary Data: Primary data are those, which are collected afresh and for the first time and this
happen to be original in character.

b) Secondary Data: Secondary data are those data which have already been collected by someone
else and which have already been used as per required.

There are basically two sources to collect secondary data

a) Internally: Provided by the company/organization

b)Externally: Various publication of central, state and local Government.

• Books, magazines, newspapers

• Internet

After only keeping in mind one can think about what type of data has to be collected during research as
our research is concerned we have to gather primary data for Customer behavior
 QUESTIONNAIRE

This method is more popular .The questionnaire is sent to the person concerned to answer the
questions formatted and return the same soon.

A Questionnaire consists of a number of questions printed or typed in definite order on a form or set of
forms. The Questionnaire is sent to the respondents. In order to achieve the research objective it is
necessary to collect accurate and relevant data, secondary data are already published data collected for
purposed other than the specific research needs at hand.

Primary data that are collected specifically for the research situation at hand, were collected by surveys
,using respondents surveys is one of the ways of collecting primary data namely observations,
experiments and surveys .

Appendices

Questionnaire on Customer survey

Topic:-Buying behaviors consumer International & Indian product.

Name:

Age/sex:

Profession:

1. Where do you like to go for shopping?

a) Super market b) Mall c) Traditional shop d) e-shopping.

2. How many time you like to visit this place?

a) During weekends b) Monthly

c) 15-20 days d) rarely

3. Are you brand conscious?

a) Yes b) No

4. Are you satisfied with the variety of brand availability in the market?

a) Yes b) No

5. If yes you prefer?

a) National brand b) International brand

6. Are you in favors of liberalization for easy availability of imported goods?

a) Yes b) No

7. Which parameter/s effect you’re buying decisions?

a) Quality b) Price c) easy availability d) national/ state

8. Which type of garments you prefer?

a) Indigenous b) Imported

9. Which type of food you prefer?

a) Indigenous b) Imported
10. Which type of cosmetic you prefer?

a) Indigenous b) Imported

11. If you prefer Indigenous product/brand what else can be done to make them comparison with
International brands?

………………………………………………………………

…………………………………………………………………

12. If you prefer indigenous goods what fascinates towards them.

………………………………………………………………….

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