Consumer behaviour and marketing

CONSUMER BEHAVIOUR• Behaviors that consumers display in searching for,

purchasing, using, evaluating and disposing of products and services.

• Focused on how an individual consumers or households make decisions to spend their available resources ( Time, Money, Effort ) on consumption related items.

• Study of When, Why, How and Where people do or do not buy a product.

• A blend of psychology, Sociology, Social anthropology and economics.

CONSUMER BEHAVIOUR AND MARKETING

• Marketing is the art and science of influencing consumer behaviour.

• Every aspect of marketing is tied to consumer behaviour.• Marketer need to understand the psychology of the

consumers.• Customer value is the difference between all the benefits

derived from a total product and all the costs of acquiring those benefits.

• Customer value requires the organisation to do a better job of anticipating and reacting to customer needs than the competitor.

• Buying behaviour includes Recognition of the problem (need to be met)search for informationconsideration of alternativespurchase, consumption, disposal • Marketers must be aware of the buying process

and consumer influences to be effective in appealing to, and meeting consumer needs

• Marketers should also aim to create value in the mind of the consumer by understanding what the consumer values

MARKET SEGMENTATION

• Finding out what kind of consumers with different needs exist.

• Consumers grouped according to their similar needs and characteristics.

• These market segments are described in terms of demographic, geographic location and media preferences.

TARGETING

• Preferred segment based on ability to meet the needs of this group.

• Choice depends on• How well the segment is served by other

manufacturers ?• How large is the segment• Do the organisation has the strength to appeal

to a particular group of consumers.

POSITIONING

• How consumers perceive your product in relation to others in the market

• Achieved through understanding the customers and applying relevant marketing mix strategies

MARKETING STRATEGY

• How an organisation will provide superior customer value to a target market

• This requires the formulation of consistent marketing mix which includes

ProductPricePromotionsPlaceService

THE PRODUCT• Product is anything a consumer acquires or

might acquire to meet a perceived need• Consumers generally buy for need satisfaction

not for physical product attributes.

PRICE

• Price is the amount of money paid to obtain the right to use the product.

• Price sometimes serves as a signals of quality.

PROMOTION

• Marketing promotions includes advertising, sales force, public relations packaging and any other signals that the firm provides about itself and the product.

DISTRIBUTION

• Distribution means having the product available where target customers can buy it. This is essential to the product’s success.

• Good channel decision requires a sound knowledge of where target customers shop for the product.

CONSUMER BEHAVIOUR AND ADVERTISING

Factors affecting consumer behavior

• Cultural and social influences– Culture– Social Class– Reference groups– Family– Demographics– Geography

• Psychological influences – Perception– Learning– Motives– Attitudes– Lifestyles

Cultural and social influences

• Culture

– Based on norms and values• Norms – boundaries a culture establishes for behavior• Values - broad preferences concerning appropriate

courses of action or outcomes

– Directly influences buying behavior


• Social Class– Determined by factors like income , wealth,

education, occupation, family prestige, value of home, and neighborhood

– It is assumed that people in one class buy different products for different reasons.


• Reference Groups

– Collection of people used as a guide for behavior in specific situations.

– Reference groups have three functions• They provide information• They serve as comparison• They offer guidance


• Family– Family consists of two or more people who are

related by blood, marriage or adoption and live in the same household.

– Family helps develop a lifestyle (how you spend time and money and the kinds of activities you value)


• Demographics– Are statistical, personal, social and economic

characteristics of a population including • Age• Gender• Education• Income• Occupation• Race/ ethnicity


• Geographic location

– Difference in buying behavior exists between different regions

– Buying behavior also differs urban areas and rural areas.

Psychological Influences

• Perception– The process by which we receive information

through our five senses and assign meaning to it.• 3 sets of influences shape perception

– The physical characteristics of the stimuli– The relationship of the stimuli to the surroundings– The person’s state of mind.

• Some stimuli are selected over others• Selective perception

– Screening out some information that does not interest us and retaining that information that interests us.


• Selective exposure– Seeking information that is in line with our beliefs, values,

experiences, biases, attitudes.

• Selective distortion– Changing the meaning of information that is conflicting with

our beliefs

• Selective retention– The process we go through to retain information


A little exercise

Activity - Perception

Activity - Perception

• Write down the ads which you remember.

• Write the reason for remembering every add.

• Discuss in class.

Psychological Influences• Learning– Perceptions lead to learning– We learn something that we perceive and attach

meaning to it.– Cognitive learning

• Perception -> Problem solving -> Insight

– Behavioral conditioning• Classic conditioning

– Pairing one stimulus with another that already is associated with a response

– e.g. associating sound of bell with end of school day

• Operant conditioning– Voluntary occurrences of behavior that are then rewarded ,

ignored or punished.

When you use a mobile while you drive, your head is somewhere else


• Motivation and Needs– Motive

• An internal force that forces you to behave in a particular way. • Advertisers study buying motives.

– Need• Basic forces that motivate us to do something• Primary needs: requirements to maintain life• Secondary: Acquired needs in response to our culture and

environment.• Needs change over time.

When did you last buy and why?


• Attitudes– A learned feeling you hold towards an object, a person

or an idea that leads to a particular behavior.

– Attitudes are resistant to change.

– Attitudes are learned, hence can be changed or replaced.

– Attitudes may be positive or negative, weak or strong.

Psychological Influence

• Lifestyle

– The way a person spends his time and money and the activities he likes to perform.

Role of consumer Behavior in Advertising

• Advertisements play an essential role in creating an image of a product in the minds of consumers.

• Advertising is basically a type of communication.• It attempts to persuade potential customers to purchase or

consume a product or service.• It is designed in such a way that it creates and reinforces

brand image and brand loyalty. • Advertisements must be catchy and communicate relevant

information to consumers.

Contd…

• Understanding the needs of the consumer is really important when it comes to creating the right advertisement for the right audience.

• Advertising is usually important for triggering the first time purchase of the product.

• it is only through advertisements; individuals are able to connect with your brand.

• Identify your target audience. The advertisement in some way must touch the hearts of the end-users for them to buy the product.

• The advertisement must show what the product is all about. It should, in a way give some kind of information about its price, benefits, usage, availability.

• Mercedes, I phone advertisement ought to be classy for people to recognize these products as status symbols.

• Advertisements meant for younger people (college goers, young professionals) ought to be colourful and trendy for them to be able to relate themselves with the product.

• Advertisements for insurance plans, medical benefits, hospitals ought to be sensible as they convey much serious information and target a mature segment of individuals altogether.

Consumer behaviour and marketing

Business

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