Consumer behavior

The term customer refers to the purchaser of a product or service whereas the term consumer refers to the end user of a product or service.

A customer is

What is it

?

Factors influencing consumer behavior

Cultural

Social

Personal

Psychological

personality

Contd..

Schiffman (2008) as that the unique dynamic organization of characteristics of a particular person, physical and psychological, which influence behaviour and responses to the social and physical environment.

related to the heredity and the experience of early childhood.

psychographic

Activities

•Interests

•Opinions

Family helps shape an individual's

attitudes and behaviours

develop political and

religious beliefs, lifestyle

choices, and consumer

preferences

society

outside influences of others

Attitude and life styles

“the patterns in which people live

and spend time and money.”

Beliefs and feelings

Values of perception

•Organization,

•Identification,

•Interpretation

The organization, identification and interpretation of sensory information in order to represent and understand the environment.

can be shaped by learning, memory and expectations.

Models of consumer behavior

Traditional models:

Economic Model

Learning Model

Psychoanalytic Model

Sociological Model

Economic model

Law of principal of maximum utility Law of equimarginal utility enables a

consumer to secure the maximum utility from limited purchasing power Price effect Substitution effect Income effect

Learning model

The response of satisfaction reinforces the relationship

Learns to associate connection between stimulus and response which becomes habit

Understanding the response of consumer at the market place

Psychoanalytical model

Personality of consumers and their responses

Consumer behavior is directed by a complete set of deep seated motives

Sociological model

As his role, status, interaction, influence,

group relation, lifestyle, income, occup-

ation, place of residence, social class etc.

Contemporary models

Harward seth model Nicosia Webster and wind Engel, balckwell and minard model

Howard sheth model

Customer lacks well defined evaluative criteria to judge the product

Searches for information After passing his own personality, his

intake is modified Evaluates the brands available Seeks greatest potential of satisfying his

motives

example

Online shopping

Nicosia model Proposed by Francesco Nicosia in

1970s Incomplete in a number of aspects,

very reductionist

Variables in the model have not been clearly defined

A number of assumptions have been made that question the validity of this model, for instance:

What type of consumer are we talking about? The company and the consumer have an

existing relationship? What type? Is this for a new product? Is this the first

exchange the consumer has had with the producer?

example

Four-wheelers

Engel, Blackwell and minard model

Information input

Information processing

Decision process stage

Variables influencing decision making process

example

Garment sectorSocial classFamilyLifestylePersonalityBeliefs attitudes

Webster and wind

partitiones the buying process into several processes

processes of decision-making are determined by environmental and organizational factors.

Final buying process rendered as the mixture of individual and group decision

example

Automobile manufacturing• B2B business

• Purchasing tires

conclusion

Understanding consumer contributes the best to any organization and for this, models would work great