Consumer behavior

Consumer behavior is actions and processes of people who purchase

goods and services for their personal consumption.
The study of consumer behavior is an attempt to understand as well as
predict human actions in buying role. Knowledge of consumer behavior
and factors that influence consumer behavior are important for
marketers to achieve the objective of consumer satisfaction. The
consumer research or consumer behavior related research enables
marketing executives to predict reaction of consumers to promotional
messages and to understand why they take the purchase decisions the
way they do. It helps in formulating effective marketing programme and
serving target markets in a profitable way.
• Socio-Cultural factors : Sociologists are of the view that individual consumer’s
behavior is affected by group of individuals known as reference groups, opinion
leaders and family. Consumer’s buying decisions are also influenced by social class
and culture.
• Economic factors: As per economists, consumer is a rational person. He has perfect
knowledge about market. He tries to get maximum value for each unit of money
and efforts spent. However, his buying behavior is affected by his personal income,
family income, income expectation, level of standard of living and consumer credit
available.
• Psychological factors : Psychologists have explained the reasons as to why
consumer behaves in a particular manner. According to them, motivation,
perception, learning, attitude and personality are the major psychological factors,
internal to the individual, that affect the behavior of an individual as consumer.
 Consumer decision –making
process
• Consumer decision-making process, also called as buying process,
explains how consumer takes purchase decisions. It represents a
problem-solving approach followed by consumer and consists of five
steps i.e. (i) Recognition of need (ii) Search for information (iii)
Evaluation of alternatives (iv) Purchase decision and (v) Post-purchase
evaluation. It is important to know that ‘time lag’ i.e. time between
need recognition and ultimate purchase is long for expensive durable
products or new products whereas it is short for non-durable and less
costly products. The various steps have been discussed in detail as
below:
 Consumer behavior is all social, psychological and physical behavior of
individuals, who are end-users of products or services, as they become
aware of, evaluate, purchase, use and tell others about products or
services. Consumer behavior is reflected in buying activities and
includes communication, purchase and consumption behavior.
Consumer behavior is influenced by various factors. These factors are
broadly classified as economic, socio-cultural and psychological factors.
As per economists, consumer buying behavior is affected by his
personal income, family income, income expectation, level of standard
of living and consumer credit available.
The decision-making unit.

We have to accept that often purchasing is carried out to meet the requirements of
more than one person, which can mean that more than one person will be involved
in the purchasing decision processes. This applies equally in consumer and industrial
purchasing. When more than one person is involved, the individuals may have a
definite "role" to play in the process. The roles have been identified as follows:
• The initiator – the person who comes up with the idea of buying an item
• The influencer – the person, or people, who will shape the outcome of the decision.
• The decider – the person with the power or authority to make the decision.
• The buyer – the person who makes the actual purchase.
• The user – the person who will eventually use the product. And, of course, in many
purchases there will also be:
• The gatekeeper – the person who can prevent the decision from being made or make it
more difficult.
Classifications of Consumer buying
behavior
There are four types of consumer buying behavior:

• Complex buying behavior

• Dissonance-reducing buying behavior
• Habitual buying behavior
• Variety seeking behavior
1. Complex buying behavior
• Complex buying behavior is encountered particularly when consumers are buying
an expensive product. In this infrequent transaction, consumers are highly
involved in the purchase decision. Consumers will research thoroughly before
committing to invest.
• Consumer behaves very differently when buying an expensive product or a
product that is unfamiliar to them. When the risk of buying a product is very high,
a consumer consults friends, family, and experts before making the decision.
• For example, when a consumer is buying a car for the first time, it’s a big decision
as it involves high economic risk. There is a lot of thought on how it looks, how his
friends and family will react, how will his social status change after buying the car,
and so on.
Dissonance-reducing buying behavior
• In dissonance-reducing buying behavior, consumer involvement is very high. This
might be due to high prices and infrequent purchases. In addition, there is low
availability of choices with fewer significant differences among brands. In this type, a
consumer buys a product that is easily available.
• Consumers will be forced to buy goods that do not have too many choices and
therefore consumers will be left with limited decision making. Based on the products
available, time limitations, or budget limitations, consumers buy certain products
without a lot of research.
• For example, a consumer who is looking for a new collapsible table that can be taken
for camping quickly decides on the product based on a few brands available. The main
criteria here will be the use and the feature of the collapsible table and the budget
available to him.
Habitual buying behavior
• Habitual Buying Behavior is depicted when a consumer has low involvement in a purchase decision. In
this case, the consumer is perceiving only a few significant differences between brands.
• When consumers are buying products that they use for their daily routine, they do not put a lot of
thought. They either buy their favorite brand or the one that they use regularly – or the one available
in the store or the one that costs the least.
• For example, when a consumer buys an energy drink, he tends to buy the flavor/taste that he likes
without actually putting in a lot of research and time. Many products fit into this category. Products
such as chocolates, cakes, juices, etc., all fit into this product category.
• Consumers just go for it and buy it – there is no brand loyalty. Consumers do not research or need
information regarding the purchase of such products.
• Habitual buying behavior is influenced by radio, television, and print media. Moreover, consumers
are buying based on brand familiarity. Hence marketers must use repetitive advertisements to
build brand familiarity. Further to initiate product trial, marketers should use tactics like price drop
promotions and sales promotions.
Variety seeking buying behavior
• In variety-seeking consumer behavior, consumer involvement is low. There are
significant differences between brands. Here consumers often do a lot of brand
switching. The cost of switching products is low, and hence consumers might want to
try out new products just out of curiosity or boredom. Consumers here, generally buy
different products not because of dissatisfaction but mainly with an urge to seek
variety.
• For example, a consumer likes to buy a cookie and choose a brand without putting
much thought into it. Next time, the same consumer might choose a different brand
out of a wish for a different taste. Brand switching occurs often and without intention.
• Brands have to adopt different strategies for such types of consumer behavior. The
market leader will persuade habitual buying behavior by influencing the shelf space.
The shelf will display a large number of related but different product versions.