Consumer Behavior

Doss.Kdoss@xime.orgWeek 1- lecture 1 & 2

In the next 32 sessions….

• W’s of Consumer Behavior (1 session)

• Factors that influence the behavior (19

sessions)

• Decision making process (4 sessions)

Consumer behavior defined….

A study of how people/org select, buy, use

and dispose goods/services to satisfy their

needs and wants

Why study consumer behavior

Lack of knowledge of CB = big mistakes!

dictate

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Why Study CB

Helps firms to understand

• The psychology of how consumers think, feel, reason

• The psychology of how the consumer is influenced by

environment

• The behavior of consumers while shopping

• Limitations in consumer knowledge and its influence

• The motivation levels and the ways it varies between

products

• How marketers can adapt and improve their campaigns

Cultural influenceSocial ClassSocial Group

InfluenceFamily InfluenceOther Influences

Learning & Memory

Personality & Self-

concept

Attitudes

Motivation &

Involvement

Information Processing

Problem Recognition

Information Search

Evaluation

Purchasing Process

Post Purchase Behavior

Consumer Research

• The process and tools used to study consumer behavior.

• Two perspectives:

– Positivist approach/Modernism (approach that regards the CB

discipline as an applied marketing science, focus is on

consumer decision making)

– Interpretivist approach/Post modernism (approach that focuses

on the act of consuming rather that on act of buying)

Segmentation Variables

Geographic

Demographic

Psychographic

Behavioral

Market segmentation

Finely-tuned marketing segmentation

strategies allow marketers to

reach only those consumers likely to

be

interested in buying their products.

Firms need to be cautious when they reach out to newer

segments

• 750 million people in the world

are disabled, according to the

World Health Organization (WHO)

• 80% of disabled people live in

developing countries

• $800 billion in spending power in

US alone

Consumers’ Impact onMarketing Strategy

• Relationship Marketing: Building Bonds

with Consumers

– Relationship marketing:

• The strategic perspective that stresses the long-

term, human side of buyer-seller interactions

– Database marketing:

• Tracking consumers’ buying habits very closely,

and then crafting products and messages tailored

precisely to people’s wants and needs based on

this information

Marketing’s Impact on Consumers

• Marketing and Culture:

– Popular Culture:

• Music, movies, sports, books, celebrities, and other forms of

entertainment consumed by the mass market.

– Marketers play a significant role in our view of the world

and how we live in it.

Marketing’s Impact on Consumers: The Meaning of

Consumption• The Meaning of Consumption:

– People often buy products not for what they do, but for

what they mean.

– Types of relationships a person may have with a product:

• Self-concept attachment

• Nostalgic attachment

• Interdependence

• Love

Marketing’s Impact on Consumers: The Global

Consumer• Majority of people on earth live in urban centers.

• Sophisticated marketing strategies contribute to a global consumer

culture.

• Even smaller companies look to expand overseas.

• Globalization has resulted in varied perceptions of countries(both positive

and negative).

Marketing’s Impact on Consumers: Virtual

Consumption• The Digital Revolution is one of the most significant

influences on consumer behavior.

• Electronic marketing increases convenience by breaking

down the barriers of time and location.

• Cyberspace has created a revolution in C2C (consumer-to-

consumer) activity.

‘Recently, I had a terrible experience with Apple MacBook and Apple India. I posted a

review at your community and only then Apple listened and actually gave me a new

laptop. Thanks to your community and its power...Fortunately, the review is being

read by around 6000 people and people have been writing to me whether they

should be Apple MacBook.’ Pradeep Chopra co-founder OmLogic

( mouthshut.com)

Needs and Wants:Do Marketers Manipulate

Consumers?• Consumerspace

• Do marketers create artificial needs?

– Need: A basic biological motive

– Want: One way that society has taught us that need can be

satisfied

• Are advertising and marketing necessary?

– Economics of information perspective: Advertising is an

important source of consumer information.

• Do marketers promise miracles?

– Advertisers simply don’t know enough to manipulate people.

Consumerism

• Culture Jamming:

– A strategy to disrupt efforts by the corporate world to

dominate our cultural landscape

The Dark Side of Consumer Behavior

• Addictive Consumption:

– Consumer addiction:

• A physiological and/or psychological dependency on products

or services

• Compulsive Consumption:

– Repetitive shopping as an antidote to tension, anxiety,

depression, or boredom

• Consumed Consumers:

– People who are used or exploited, willingly or not, for commercial

gain in the marketplace

Next session

Perception