Consumer Behavior its Process, 4 Factors & Markets
Introduction to Consumer Behaviour
Concept and Meaning
Consumer Behaviour is the study of the processes involved when individuals or groups select, purchase, use, or dispose of products, services, ideas, or experiences to satisfy needs and desires.
It attempts to answer the “5 Ws and 1 H”:
What do they buy?
Why do they buy it?
When do they buy it?
Where do they buy it?
Who buys it?
How often do they buy it?
Consumer vs. Customer
Customer: The person who purchases the goods (The Buyer).
Consumer: The person who uses the goods (The End User).
Example: A mother buying baby food is the Customer, but the baby is the Consumer. Marketers must target both.
Types of Customers in Consumer Markets
Understanding the different types of customers helps in designing specific marketing strategies.
1. Loyal Customers
These customers purchase the same brand or shop at the same store repeatedly.
Significance: They are the most valuable asset. They provide steady revenue and positive word-of-mouth.
2. Discount Customers
These customers shop frequently but make decisions based on the size of markdowns or sales.
Significance: They help clear inventory (cash flow) but can increase costs due to returns and low margins.
3. Impulse Customers
They do not have a specific product in mind when they enter a store. They make purchasing decisions at the spur of the moment.
Significance: Retailers target them with attractive displays and Point-of-Sale (POS) promotions.
4. Need-Based Customers
They have a specific intention to buy a specific type of product.
Significance: They are difficult to upsell. If they don’t find what they need, they leave immediately.
5. Wandering Customers
They have no specific need or desire in mind; they wander for the experience or social interaction.
Significance: They make up the largest traffic in malls but the smallest percentage of sales.
Buying Motives: Rational vs. Emotional
A Buying Motive is the internal force or urge that induces a person to buy a product.
1. Rational Buying Motives (Head/Logic)
These motives are based on logical reasoning and sound judgment. The customer analyzes the “Pros and Cons” before spending money.
Price/Economy: Buying a product because it is cheaper than alternatives.
Durability: Buying a product because it lasts a long time (e.g., Furniture).
Efficiency: Buying a car that gives high mileage.
Suitability/Utility: Buying a product because it fits a specific need perfectly.
2. Emotional Buying Motives (Heart/Feelings)
These motives are driven by emotions, sentiments, or instincts, often without logical analysis.
Pride & Prestige (Status): Buying a luxury car (Mercedes) or expensive watch (Rolex) to display wealth.
Fear: Buying life insurance, helmets, or burglar alarms out of fear of loss or injury.
Love & Affection: Buying gifts for family or toys for children.
Comfort: Buying an air conditioner or a soft mattress.
Imitation: Buying a smartphone because a celebrity endorses it.
The Consumer Buying Decision Process
The purchase is not a single event; it is a 5-Step Process.
Stage 1: Problem Recognition (Need Arousal)
The process begins when the buyer recognizes a difference between their actual state and their desired state.
Internal Stimuli: Hunger, thirst, sleep.
External Stimuli: Seeing an advertisement, smelling fresh bread, seeing a friend’s new car.
Stage 2: Information Search
Once the need is triggered, the consumer looks for information.
Personal Sources: Family, friends, neighbors (Most effective/trusted).
Commercial Sources: Advertising, salespeople, websites, packaging.
Public Sources: Mass media, consumer ratings, blogs.
Experiential Sources: Handling, examining, or testing the product.
Stage 3: Evaluation of Alternatives
The consumer processes the information to arrive at brand choices.
Evoked Set: The specific brands the consumer considers buying.
Evaluation Criteria: Analyzing attributes like Price, Features, Style, and Warranty.
Decision: “Brand A is cheaper, but Brand B has better quality.”
Stage 4: Purchase Decision
The consumer forms an intention to buy the preferred brand. However, two factors can still interfere:
Attitudes of Others: (e.g., A husband wants a sports car, but his wife insists on a family van).
Unanticipated Situational Factors: (e.g., The consumer loses their job, or the product is out of stock).
Stage 5: Post-Purchase Behaviour
The marketer’s job does not end at the sale. The consumer will experience either:
Satisfaction: Performance matches expectations.
Dissatisfaction: Performance falls below expectations.
Delight: Performance exceeds expectations.
Cognitive Dissonance: A feeling of post-purchase anxiety (“Did I make the wrong choice?”). Marketers reduce this through warranties and follow-up calls.
Factors Influencing Consumer Behavior
Consumer behavior is the result of the interplay of four major factors:
1. Cultural Factors (The Broadest Influence)
Culture: The set of basic values, perceptions, wants, and behaviors learned from family and society. (e.g., In India, cultural values often dictate spending on weddings).
Sub-Culture: Distinct groups within a culture based on nationality, religion, or geography (e.g., Punjabi cuisine vs. South Indian cuisine preferences).
Social Class: Relatively permanent divisions in society (Upper, Middle, Lower) determined by income, occupation, and education. Each class has distinct product preferences.
2. Social Factors
Reference Groups: Groups that have a direct or indirect influence on a person’s attitudes (e.g., Co-workers, College friends).
Opinion Leaders: People who influence others (e.g., Tech YouTubers).
Family: The most important consumer buying organization. Marketers study the roles of husband, wife, and children.
Roles and Status: A person buys products that reflect their role in society. A Manager buys a suit; a mechanic buys overalls.
3. Personal Factors
Age and Life-Cycle Stage: Tastes in food, clothes, and recreation change with age (Bachelor → Newly Married → Full Nest with Kids → Empty Nest)
Occupation: A software engineer buys high-end gadgets; a factory worker buys durable work gear.
Economic Situation: Buying power depends on income, savings, and credit availability.
Lifestyle: A person’s pattern of living as expressed in their AIO (Activities, Interests, Opinions).
4. Psychological Factors
Motivation: A need becomes a motive when it is strong enough to drive action.
Maslow’s Hierarchy of Needs: Physiological → Safety → Social → Esteem → Self-Actualization
Perception: The process by which we select, organize, and interpret information. Two people can see the same ad but perceive it differently.
Learning: Changes in behavior arising from experience. (e.g., “I bought Brand X and it broke; I will never buy it again”).
Beliefs and Attitudes: Descriptive thoughts and deep-seated feelings about a brand. (e.g., “Apple is expensive but reliable”).
Practical Examples for Exams
Cultural Factor: Selling beef products in India is difficult due to cultural/religious beliefs, whereas it is common in the USA.
Social Factor (Family): A car purchase in India is often a family decision, whereas in the West, it might be an individual decision.
Psychological Factor (Perception): Consumers perceive a product priced at ₹999 as significantly cheaper than ₹1000, even though the difference is only ₹1.
