Consumer is considered as very important person to a marketer. A consumer decides what to buy, when to buy, for whom to buy, why to buy, from where to buy and how much to buy. To become an efficient marketer, one must know the likes and dislikes of consumers for his product. In the last fifteen years, various models have been developed for explaining the manners of consumers’ in common decision-making circumstances. A lot of these models are impressive in scope, but their strength to explain the behaviour of consumers has been considerably concealed.
In fact, the majority research attempts so far have only been directed towards particular segments of the models rather than at the entire models. During a main study which endeavoured the testing of the entire Howard-Sheth model, the authors realized that many variables involved measurement and substantial definitional problems (Farley and Ring 1970). Consumer behaviour According to David Loudon and Albert J. Della Bitta consumer behaviour implies “the physical activity and decision process individuals engage in when acquiring, evaluating, disposing, and using of goods and services”.
Consumer behaviour deals with how a customer acts or reacts or behaves in making a purchase of services and goods of his choice in various circumstances. ( Rohracher, H(2003)), In the current world of promptly changing technology, consumer likings are also categorized by rapid changes. For existing in the market, an organization should consistently know the latest consumer tastes and trends. Consumer behaviour provides guidelines and invaluable clues to marketers on recent technological frontiers which they have to examine. For example, Lap Tops Mobile Phones, LCD Monitors, etc. Importance of Consumer behaviour: New aggressive competitors are rising with greater frequency.
• Ever intensifying and increasing competition.
• Change basis of rivalry.
• Niche attacks are happening to be common.
• Geographic sources of rivalry are becoming extensive.
• Pace of improvement is rapid.
• Product differentiation is deteriorating.
• Price competition is becoming further aggressive The modern marketing is customer oriented. All marketing activities revolve around the customer. As marketers began to study the behaviour of consumers, they soon realized that despite overriding similarities, all consumers were not alike.
Consumers differ in their taste, interest, nature, habits, needs, wants, income, age, mode of purchasing, lifestyle and so forth. All consumers do not like to use the same product. In this sense, all commodity markets are not homogeneous; rather they are heterogeneous (Rohracher, H (2003)). The same product cannot satisfy the needs of selected groups of consumers, marketers adopt the strategy of market segmentation. The marketers subdivide a market into homogenous sub-sets of customers having common customers in one set, in order to facilitate the marketing of their products.
Such selection of sub-sets as homogenous groups is called market segmentation. The market segmentation may be based on demographic, psychological or other strategic variables. Basic criteria for Market segmentation A market may be segmented on the basis of different variables. These variables can be grouped as: 1. Demographic factors 2. Geographical factors 3. Psychological or personality factors 4. Consumer- Behavioural factors 5. Socio- cultural factors. Demographic factors: – This includes population characteristics. This segmentation can be affected on the basis of their;
• Age, For instance, Child, young ones, adults, old etc. Sex can be categorised as Children, male, female, etc.
• Income: – high income groups, low income groups, middle class families etc comes under this category.
• Educational level: – For instance, a book market can be segmented as primary, secondary, high school, degree, post-graduate etc.
• Occupational status: – factors like the white collar workers and the blue collar workers, or businessmen, service class or professional etc.
• Size of the family: – big or small family. For example, electronic equipments and other household products are marketed with respect to the size of family.
Geographical factors: – Here the market is divided on the basis of geographic locations. The different bases may be area such as each state may be divided into segments. This segments may be further divided into rural, urban or town areas, or on the basis of climate such as hill or plain areas. Psychological or personality factors: – Here the segmentation is done on the basis of the intrinsic value of individual consumers. The bases are: Personality or Psychographic: – these groups can be made on the basis of lifestyle, the social class, personality, or the motto of consumers.
Benefit sought: – here the segmentation is done on the basis of benefits sought by different groups. For example, toothpaste market, children look for flavour, young looks for brightness, larger families for decay prevention, and men for prices. Consumer – Behavioural factors This mainly includes three factors such as;
• Rate of usage: – the quantity to be purchased by different groups.
• Buyer’s Motive: – motives such as economy, quality of the product, reliability, prestige in the society etc.
• Brand Loyalty Socio-Cultural Factors This mainly includes factors such as; Culture: – different cultures have different values, beliefs and customs.
• Sub-culture: – it also has different values etc.
• Social Class: – which is on the basis of income status in the society
• Family Life Cycle: – requirements differ in different stages of family life cycle. eg. Newly married, well established families etc. For effective market segmentation there are five major criteria. They are; 1. Identification and Measurability – this means that marketer must identify his consumer to whom he has to serve and whose requirements are almost the same.
The size of the market segment should also be measurable. 2. Responsiveness – the marketer should also specify whether consumers respond positively to the firm’s product or service. 3. Adequate Market Potential – There must be a sufficient number of people who can purchase the company’s product at a profit. They must have sufficient purchasing power to demand the product. 4. Accessibility – Market should be easily accessible to the marketer. Some markets are inaccessible for legal reasons or cost reasons. 5. Stability – Market must be stable to have a continuous demand.
There should be minimum change in the market. Models of consumer behaviour A model is a representative of an actual system. It focuses the similar features of that system. The aim of consumer behaviour models is to bring together our current awareness by introducing a series of models that try to describe the purchase decision procedure compared with pertinent variables (Lawrence, P. A. , and J. C. Jenkins (2000)). Various models have been proposed based on various factors such as environmental, scope, social, psychological, etc.
The main objective of proposing models is to determine the purchasing behaviour of consumers. However, these models can be considered in determining.
• Consumers’ attitude towards purchasing.
• Appropriate variables while purchasing.
• The features of variables
• Interrelationship between them. The buyer/decision process In 1967, Faris, Wind and Robinson put forward a model that demonstrates purchasing as a trouble. This is revealed in Fig. 1 and it explains the activities relate to the purchasing process: Fig. 1 The buyer/decision model
An individual requires a specific product. Information’s are collected from various sources including friends and family (commonly said as ‘word of mouth’) from catalogues, from visits to retail firms, from advertising, and from various sources. If the consumer is unaware of the product then the information search will be greater. The job of marketing is to make sure that the organisation’s products get high publicity throughout this ‘information search’ time and the optimum features of the product are stressed throughout the ‘evaluation of alternatives’ phase.
This will place the organisation’s product in the top position prior to the ‘purchase decision’, since the consumer is still helpless to further influences to make the right choice. Marketers should also be conscious of ‘post-purchase behaviour’ as this can influence further business and forward looking organisations attach great concern to after-sales service to improve the initial sale. This will reduce the extent of dissatisfaction in case of legitimate complaints (Lawrence, P. A. , and J. C. Jenkins (2000)).
Awareness of how the buyer/decision procedure operates is crucial for the success of marketing strategy. For simple purchases, the job of marketing is to guide the purchasing procedure in favour of the organisation’s products, maybe through an efficient advertising campaign. For more difficult purchases, consumers are assisted in their problem-solving procedures and that reassure is given to prove that their selection is a good one. The adoption process Marketers must initially make awareness and then help consumers through succeeding stages of the procedures.
Consumers cannot start to consider a new service or product as an answer to need-related problems without this knowledge. Successful unique products should try to be problem-solving as much as the consumer is concerned. Fig. 2 The adoption process If the product has appeal and potential interest, then potential buyers will search for further information. Customers then assess the new product in contradiction to the existing products, and then create an initial espousal by getting a trial sample, which may be a trial purchase or a free sample.
In adoption stage a decision is made whether to make use of the product. Post adoption confirmation is done when the product is adopted and the customer is looking for reassurance about the good sense of the purchase. Classification of Consumer Behaviour Models
• Economic Model – According to economic model, purchasing power of a customer depends on the concept of utility which states that if an individual has certain amount of money and defined sets of needs and a set of products then he or she will spend his or her money only on those products which yields him or her maximum benefits. The Learning Model – The learning model is fully based in the capability of a person to learn, discriminate and forget. It is based on Pavlov’s stimulus response which states that to bring changes in the consumer’s behaviour one must change the stimuli, responses and drives as per consumer’s perceptions or attitude.
• The Psychoanalytical Model – Since, the psychoanalytical model is a blend of two words ‘psychology’ and ‘analyses,’ it mainly deals with the study of psychology of customers. According to this model, every buying decision has a complicated motive by a purchaser which can be affected by his or her sense of longings and desires. The Sociological Model – According to the sociological model individual’s decisions not only depends on utility factors but mainly they are dependent on societal factors like groups of society, levels of society, and attitudes of persons of society. However it should also be noted that purchasing decisions are governed by societal restrictions also.
• The Nicosia Model – The Nicosia model is one of the examples of systems model where humans are treated as a system, with inputs as stimuli and behaviour being its output. It is mainly constructed by considering the marketing viewpoint of a consumer.
It was proposed by Francisco Nicosia, an expert in consumer motivation and behaviour in 1990. It establishes the relationship between firms and its consumer. It focuses how the activities of firm target the consumer to purchase firm’s products and finally its usage and evaluation on certain criteria (Shove, E (2003)).
• The Howard Sheth Model – The Howard Sheth model has been put forward by John Howard and Jagadish Sheth in 1969. This model states that there exists certain variable which affects the perception and learning of consumer, apart from inputs and outputs.
These variables are imaginary as it is difficult to measure them directly. Several other models have been proposed to explain purchaser’s behaviour. But all these models have their own pros and cons. In spite of their limitations, these models are helpful in determining a buyer’s behaviour. The psychology of marketing The mission of marketing is to recognize consumers’ wants and needs precisely, then to develop services and products that will fulfil them. In marketing to be successful, it is not enough to merely find out what customers need, but to discover why it is necessary.
Only by obtaining a comprehensive and deep understanding of consumer behaviour can marketing’s objectives can be realised (Kindig, L. June (2002)). Such an awareness of consumer behaviour helps to the mutual benefit of the marketer and consumer, permitting the marketer to turn into better capable of satisfying the consumer’s requirements effectively and determine a loyal group of consumers with a positive approach towards the organisation’s products. The psychological factors such as motivation, perception, motivation, learning, beliefs and attitudes have a great role in influencing consumer behaviour.
Perception is the procedure by which consumers organize, select, and interpret information. It is divided into;
• Selective attention – tendency of people to eliminate almost all information to which they are exposed.
• Selective retention – to retain only part of the information to which they are exposed.
• Selective distortion – to interpret information in a way that supports what they already believe. Learning is the changes in a person’s behaviour, rising from experience. It happens through the interplay of stimuli, cues, drives, reinforcement and responses.
A belief is the descriptive thought that a person holds about something. An attitude is a person’s consistency favourable or unfavourable feelings, tendencies and evaluations towards an idea and object (Wiser, R. H. (1998)). Motivation is the underlying force of any human activity not to mention buying alone. It is wishes or desires which initiate the sequence of events known as behaviour. Motivation depends on the Maslow’s Hierarchy of needs theory. Theories related to consumer behaviour are; Involvement theory and Message presentation
Two routes to persuasion- central route and peripheral route- theory are important in message presentation. The central route to persuasive theory suggests that a well documented advertisement concerning the pros and cons of the product encourages active, cognitive information processing that may induce the consumers to buy the products. It indicates a high involvement purchase situation (Shove, E (2003)) On the other hand; the peripheral route is adopted in low purchase situation. In such a case the marketer emphasizes the non- content message elements as background scenery, music celebrity spokespersons.
Some marketers oversimplify the two- route approach differentiating between peripheral (emotional) and central (rational routes) message appeals. Therefore the message should stress the unfulfilled needs of the consumers (central routed) as well as visual and symbolic cues in the ad should also support product claims (peripheral route). Those two combined enhance the persuasiveness of the message. One sided vs. Two sided messages A message might be either one sided or two sided. The one sided message describes only the plus points of the product advertised.
No weak point is mentioned in the advertisement. It does not acknowledge any strong points of the competitors’ products or weak point of the producers’ product. A two- sided message is one which describes not only the strong points of communicator’s product but also recognize the strong points of opposition’s products or few weak points of communicator’s product. Which type of message- one- sided or two sided- should be or should marketers tell their audiences only good points of their product or should they admit some negative qualities in their product?
Which strategy should they adopt? The answer of these questions depends on two factors, type of audience and the type of competition (Shove, E (2003)). When the communicator is of the view that the audience are friendly (if audience uses his product) or they initially favours the communicator’s position or they are not likely to hear the opposition’s claims, then one-sided(supportive) message that favours only communicator’s message should be more effective.
But when the audience are critical or unfavourable in the beginning or unfriendly (or if they uses opposition’s product) or if they are well educated or if they are likely to hear opposition’s claims, then a two –sided message is more effective because the audience tends to regard the communicator as more honest and objective since they admits merits of competitor’s products. Negative example There are various negative advertising between corporations. There are two main reasons for why they are not totally applicable to use. You don’t need to select. For instance, you can purchase both Pepsi and Coke. No one care about that. You can eat at both Burger King and McDonald’s – they are not going to stop you. One of the major driving forces behind recent advertising is that they are not directly related to sales numbers. And in many cases there will be a clear market leader who is impossible to overthrow. In future, Coke will rule the cola market. Since billboards and commercials don’t necessarily convert into money. The second reason is you are not required to watch the negative ads for products or corporation. They are mainly focused on branding; this means if you watch something linked to them you may correlate them with that particular brand. So when McDonald’s is attempting to be cool, health-aware, and their opponent open- Burger King is trying to be funny, quirky, and hip. There will be no cause for Burger King to hit McDonald’s directly in an ad as they’re legally restricted in what they are endorsed to say, and they will only be destroying their own product.
And for those who do swipe at the rivalry usually do so in a deliberately humorous method. 1. One of the best examples for negative Ads is that what bad ideas Coca-Cola could tell about Pepsi. Actually this is not correct excluding that from their viewpoint their drink tastes excellent. This idea is what Coca-Cola normally uses to advertise, that their product tastes better. Thus they are indirectly advertising that their drink tastes much better comparing any other drink, for instance Pepsi. 2.
The recent Burger King advertisement are adopting the similar strategy as the Pepsi challenge, in the Burger King ads they are demonstrating a faraway lands to locate a whopper virgin and are checking the flavour of the whopper against a Big McDonald’s, and the virgin selects the whopper of Burger king as better tasting. Thus they are indirectly advertising a negative ad against the Big McDonald. In fact the experts’ findings and the research proves that some negative advertisements can make opposite consequence in consumers. For instance: Anti-Tobacco ads might be creating more desire and consciousness for cigarettes.
An anti-obesity advertisement tends to seem as negative messages that can cause social troubles and support discrimination. Conclusion The business world is very complex. There are various factors that may affect the behaviour of the customer. These factors can be an ethnic group, values, social class, religion, age, gender, etc. The consumers’ process, interpret, perceive and store the stimuli is very important. This job will explain how consumers perceive, what perception is and how this idea can be applied by marketers. We cannot assume customers of all countries alike in their purchasing habits.
The marketers’ must know the consumers behaviour in exotic markets in order to develop their products or promotional plans to meet the requirements of the targeted foreign customers. Thus, the awareness of consumer’s behaviour is very important mainly for government agencies and marketers, it also benefits the customers. The awareness can serve as information for an educational programme planned to enhance their decision making regarding services and products.
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