CONSUMER BEHAVIOR

Consumer behavior is the study of how people buy,

what they buy, when they buy and why they buy. It attempts to understand the buyer decision making process, both individually and in groups. It studies characteristics of individual consumers such as demographics, psychographics, and behavioural variables in an attempt to understand people's wants.

Buying Behavior
Definition : The decision process and acts of people involved in

buying and using products.

How does the buyer make purchasing decision? What factors influence consumer purchases?

Need to analyze buying behavior

What, Where, When & How Marketing Mix. Helps predict how consumers will respond to marketing strategies. Great impact on the success of firms marketing strategy.

Types of consumer buying behavior

Routine Response/Programmed Behavior
Limited Decision Making Extensive Decision Making

Impulse Buying

Routine Response / Programmed Behavior

Frequently purchased low cost items. Low involvement required. Little search and decision effort Purchased almost automatically.

Examples- routine response

Limited Decision Making

Occasional buying.
When information is needed for a unfamiliar brand in

a familiar product category. Requires a moderate amount of time for information gathering. Loyalty to a brand

Examples- limited decision

Extensive Decision Making

Complex process- requires high involvement
unfamiliar, expensive, infrequently bought products. High degree of economic/performance/psychological

risk. Lot of time spent seeking information and deciding.

Examples- extensive decision

Impulse Buying
Basis - purchase of the same product does not always

elicit the same Buying Behavior.

Reason determines the extent of decision-making. No conscious planning.

Examples- impulse buying

THIS

or

THIS ??

going for the dinner- reason can be an anniversary celebration, or a meal with a couple of friends.

Perception

The process by which an individual selects, organizes, and interprets stimuli into a meaningful and coherent picture of the world.

 Companies or Retailers mark up prices before putting them

up on sale. -- Bargaining behavior Discounts offered by reputed companies are genuine reduction in prices.-- Wait for the discount announcement Celebrities are admired by their followers though they do not use the product they endorse. --Success of soaps and cosmetics Lower price generally means inferior quality. Higher priced brands are not superior in quality by the same degree of multiplier. --Positioning at a lower quality end, as done by Haier, Lenovo Shopping in a big departmental store saves money.--Big Bazaar, Subhiksha Packaged ready-to-eat food items marketed in India are generally not fresh.-- Limited success of MTR, ITC foods

Influencing factors:
Cultural Factors Social Factors Psychological Factors

The marketer must be aware of these factors in order to develop a appropriate marketing mix for its target market.

Cultural Factors
Cultural factors exert the broadest and deepest

influence a) Culture b) Subculture, c) Social class are particularly important in buying behavior.

Marketers must Understand Indian Culture in Order to Succeed

Ford cars specially designed for Indian roads. Electrolux's madeforIndia fridge

chill drinking water, keeps food fresh & withstands long power cuts. Samsungmicrowave oven with grill. Nokia launched a handset Made for India Nokia 1100. McDonalds Mc Aloo Tikki Burger & Pizza McPuff. Cartoon Network-introduced South Indian folk tale Tenali Ram. Walt Disney cartoon TV shows are in Hindi. Omegawatches picked an Indian film personality to replace Cindy Cawford in its ad campaign. CocaCola has redesigned its crates as well as trucks for safe delivery on poor roads

Social Factors
Consumers wants, learning, motives etc. are

influenced by family, reference groups, social class A) Roles and Status B) Family C) Reference group

Psychological Factors

A persons buying choices are influenced by 4 major psychological factors 1. Motivation 2. Perception 3. Learning 4. Beliefs & attitudes

Consumer Buying Process

Need Recognition

Information Search

5 Stage Model of the Consumer Buying Process

Evaluation of Alternatives

Purchase Decision

Post-purchase Behavior

Need Recognition (awareness of need)

The buying process starts when the buyer

recognizes a problem or need. The need can be triggered by internal ,external, marketing stimuli. Ex.- persons normal needs-hunger/ thrust rises to threshold level and becomes a drive.

1. PROBLEM RECOGNITION

Difference between the desired state and the actual condition.

Example: By seeing a commercial for a new pair of shoes, stimulates your recognition that you need a new pair of shoes. Hunger stimulates your need to eat.

2. Information search
An aroused consumer will be inclined to search for

more information Internal search- memory. External search- if he needs more information. Friends and relatives (word of mouth); Marketer dominated sources; comparison shopping; public sources etc.

Contd..
Helps buyer find possible alternatives- i.e- the evoked

set. Hungry- want to go out and eat, evoked set is Chinese food Indian food etc.

3. EVALUATION OF ALTERNATIVES
Need to establish criteria for evaluation, features the

buyer wants or does not want. Rank/weight alternatives. Example: If you want to eat something spicy, then Indian food gets the highest rank etc

Evaluation of Alternatives Competitor brand information Consumer evaluation process 1. The consumer is trying to satisfy the needs. 2. The consumer is looking for certain benefits from

the product solution. 3. The consumer sees each product as a bundle of attributes for delivering the benefits sought to satisfy these needs

Contd..
Attributes of interests to buyer : Cameras : picture, sharpness, size ,price Hotels: Location ,cleanliness, atmosphere, price
If not satisfied with your choice then return to the

search phase.

4. Purchase decision In evaluation stage the consumer form preferences

among the brands In this phase-Choose buying alternative includes product, package, store, method of purchase , Incentives offered, out of stock, budget etc.

Consumer

4. PURCHASE DECISION

Choose buying alternative, includes product, package, store, method of purchase etc.
5. PURCHASE : May differ from decision, time lapse between purchase decision and the actual purchase, product availability.

6.Post-Purchase Evaluationoutcome:
Satisfaction or Dissatisfaction.
Have you made the right decision? This can be reduced by warranties, after sales

communication etc. It is the outcome Satisfaction or Dissatisfaction. This can be reduced by warranties, after sales communication etc.
Ex: After eating an Indian meal, may think that really

you wanted a Chinese meal instead of Indian.

so

where to start

everywhere

People Cluster Image build

Communities

To influence Consumer Behavior

Make

People
Friends