Consumer behaviour is the study of how individuals, groups, or organizations select, purchase, use, and dispose of goods, services, ideas, or experiences to satisfy their needs and desires. This field examines the psychological, social, cultural, and economic factors that influence consumer decision-making. For marketers, understanding consumer behaviour is crucial to developing effective strategies that meet consumer demands and enhance satisfaction.
Definition of Consumer Behaviour
American Marketing Association (AMA):
“Consumer behaviour is the dynamic interaction of affect and cognition, behaviour, and the environment by which human beings conduct the exchange aspects of their lives.”Philip Kotler:
“Consumer behaviour is the study of how individuals make decisions to spend their available resources (time, money, effort) on consumption-related items.”
1. Importance of Studying Consumer Behaviour
Improved Marketing Strategies:
- Understanding consumer needs helps businesses create products and campaigns that resonate with their audience.
- Example: Customizing offers for millennials versus Gen Z consumers.
Segmentation and Targeting:
- Identifies diverse consumer groups and enables precise targeting based on preferences.
Product Development:
- Insights into consumer preferences guide innovations and product improvements.
Predicting Market Trends:
- Studying past behaviours helps anticipate future market demands.
Enhancing Customer Satisfaction:
- By understanding consumer expectations, businesses can provide superior value.
2. Characteristics of Consumer Behaviour
Dynamic Nature:
- Consumer preferences change over time due to societal trends, technological advancements, or personal experiences.
Influenced by Various Factors:
- Psychological, cultural, social, and personal factors drive buying decisions.
Varied Decision Processes:
- The complexity of decision-making depends on the type of product, ranging from habitual purchases to extensive research for high-value items.
Goal-Oriented:
- Consumers make purchases to fulfill specific needs or desires, often influenced by Maslow’s hierarchy of needs.
Continuous Process:
- Consumer behaviour extends beyond the purchase, encompassing post-purchase evaluation and future purchase intentions.
3. Types of Consumer Behaviour
Complex Buying Behaviour:
- Occurs when: The product is expensive, infrequent, and has a significant impact (e.g., buying a car).
- Example: Consumers evaluate features, consult reviews, and compare brands extensively.
Dissonance-Reducing Buying Behaviour:
- Occurs when: Consumers face a high-involvement decision but see minimal differences among brands.
- Example: Choosing between similar air conditioners; post-purchase reassurance is critical.
Habitual Buying Behaviour:
- Occurs when: Low involvement and minimal brand differences exist.
- Example: Purchasing everyday items like bread or toothpaste.
Variety-Seeking Buying Behaviour:
- Occurs when: Low involvement but significant brand differences exist.
- Example: Trying new snack brands for a change in taste.
4. Models of Consumer Behaviour
Economic Model:
- Consumers are rational and aim to maximize utility based on available resources.
Psychological Model:
- Focuses on the psychological factors (motivation, perception, learning, beliefs, and attitudes) influencing behaviour.
Sociological Model:
- Highlights the impact of society, culture, and family on consumer decisions.
Howard-Sheth Model:
- Explains consumer decision-making based on three levels: extensive problem-solving, limited problem-solving, and habitual response behaviour.
5. Stages of Consumer Decision-Making Process
Need Recognition:
- Identifying a problem or need.
- Example: Feeling thirsty leads to purchasing a beverage.
Information Search:
- Gathering information from personal, commercial, public, or experiential sources.
Evaluation of Alternatives:
- Comparing brands or products based on features, price, and quality.
Purchase Decision:
- Selecting the product and finalizing the purchase.
- Influenced by: Availability, promotions, or external opinions.
Post-Purchase Behaviour:
- Evaluating satisfaction, which impacts future purchases and brand loyalty.
6. Factors Influencing Consumer Behaviour
Cultural Factors:
- Culture: Influences values, perceptions, and preferences.
- Subculture: Specific groups with shared values (e.g., regional or religious groups).
- Social Class: Income, education, and occupation determine preferences.
Social Factors:
- Family: Plays a significant role in shaping consumption habits.
- Reference Groups: Influence choices through opinions or shared interests.
- Roles and Status: Define purchase patterns based on societal expectations.
Personal Factors:
- Age and Life Cycle Stage: Needs and priorities change over time.
- Occupation and Economic Situation: Affect purchasing power.
- Lifestyle and Personality: Reflect individual preferences and attitudes.
Psychological Factors:
- Motivation: Driven by needs (Maslow’s hierarchy).
- Perception: Influenced by selective exposure, distortion, and retention.
- Learning: Past experiences guide future decisions.
- Beliefs and Attitudes: Shape preferences and brand loyalty.
7. Applications of Consumer Behaviour in Marketing
Product Development:
- Tailoring products to meet specific consumer needs and expectations.
Pricing Strategies:
- Understanding perceived value and price sensitivity.
Promotional Campaigns:
- Crafting messages that resonate with target audiences.
Distribution Decisions:
- Ensuring products are available where the target audience shops.
Customer Relationship Management (CRM):
- Building loyalty by understanding and addressing customer concerns.
8. Contemporary Trends in Consumer Behaviour
Digital and Social Media Influence:
- Online reviews, influencer marketing, and social media platforms shape purchasing decisions.
Sustainability and Ethical Consumption:
- Increasing preference for eco-friendly and socially responsible brands.
Personalization:
- Consumers expect tailored experiences and recommendations.
Omni-Channel Shopping:
- Seamless integration of online and offline channels.
Increased Price Sensitivity:
- Economic uncertainty has heightened focus on value for money.
Conclusion
Consumer behaviour is a multidimensional field that provides valuable insights into the complex decision-making processes of individuals and groups. For marketers, understanding these behaviours is essential to crafting effective strategies that align with consumer needs and preferences. By studying consumer behaviour, businesses can build stronger connections with their target audiences and foster long-term relationships.
In the next section, we will explore the Consumer Buying Process in greater detail, providing a structured understanding of how purchase decisions are made.