Consumer behavior Defining consumer Anyone who makes a purchase for the end consumption and not for

further sale. Whats behavior? The way in which anyone behaves or responds to a particular situation. So, Consumer Behaviour is to study what a consumer want, why he want, when, where, and how often.. It can be defined as, The study of the processes involved when individuals or groups select, purchase, use, or dispose of products, services ideas, or experiences to satisfy needs and desires. the decision process and physical activity individuals engage in when evaluating, acquiring, using, or disposing of goods and services. Reasons for studying CB Increase in consumer power Tracking consumers more effectively Helps marketers to offer more services and goods than ever before For students of human behavior

STUDYING CONSUMER BEHAVIOUR The study of consumer behaviour can also be quite complex, because of many variables involved and their tendency to interact with and influence each other. Models of CB have been developed as a means of dealing with this complexity. The under mentioned model revels that it is made up of three major sections: External environmental variables influencing behaviour Individual determinants of behaviour The consumers decision process

External Variables It consists of six specific influences which are, culture, subculture, social class, social group, family, and personal influences. Individual Determinants It includes five major determinants-Personality and self concept, motivation and involvement, information processing, learning and memory and attitudes. The Consumer Decision Process It starts with Problem recognition which occurs when the consumers is activated by the awareness of a sufficient difference the actual and the ideal situation. For eg, realization of acute thirst and the nonavailability of water or any other beverage. Prerna garg 1

Consumer behavior Then the consumer tends to undertake an informal search which usually starts with internal search). If it doesnt satisfies, the consumer goes for an external search. The purchasing process involves a series of decisions, including the type of retail outlet and specific brand or service. The outcomes of the purchase can be either satisfaction or dissatisfaction. Dissatisfaction can generate a heightened desire for additional info as well as post purchase experiences that results in feedback to the problem-recognition stage.

Consumer decision process( input-process-output)

Firms marketing efforts Product Place Price Promotion Socio cultural environment Family Informal sources Non commercial sources Social class Subculture and culture

Need recognition

Prepurchase search Evaluation of alternatives

Psychological field Motivation Personality Perception Learning Attitudes

Experience

Purchase Trial Repeat purchase

Post purchase evaluation SCHIFFMANS AND KANUKS MODEL FOR CONSUMER BUYING PROCESS Prerna garg 2

Consumer behavior It varies considerably in their complexity. So, due to their varying complexity and purchase, consumers make quite complicated decisions. The range of problem solving can be classified as follows: For frequent and general purchases, consumers require little or no information search and are brand loyals.
ROUTINE PROBLEM SOLVING-

It requires time in seeking and choosing when a consumer buy a new brand in a familiar product category.
LIMITED PROBLEM SOLVING-

It involves substantial information search when a consumer makes a purchase in an unfamiliar product category.
EXTENSIVE PROBLEM SOLVING-

ROUTINE PROBLEM SOLVING purchase involvement low level Problem recognition Automatic

LIMITED PROBLEM SOLVING medium

EXTENSIVE PROBLEM SOLVING High

Semi automatic

Complex

Information search And involvement

Minimal

Limited

Extensive

Purchasing orientation Convenience Post purchase process Brand loyalty

Mixed Repurchase or brand switching

Shopping Loyalty or complaint

PROBLEM RECOGNITION It occurs due to difference in sufficient magnitude between the actual and perceived situation. Consumers must become aware of the problem arising internally or externally.
TYPES OF PROBLEM RECOGNITION

They can be basically classified into four types: Routine problems- Those in which the difference between the actual and desired stares are expected to occur and an immediate solution is required. Emergency problems- Those that are unexpected in which immediate solutions are necessary. Planning problems- Those that are expected to occur but an immediate solution is not necessary. Evolving problems- Those that are unexpected to occur and no immediate solution is required too.
SITUATIONS LEADING TO PROBLEM RECOGNITION

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Consumer behavior Depleted or inadequate stock of goods Discontentment with the stock of goods Changing environmental circumstances Changing financial circumstances Marketing activities INFORMATION SEARCH Search refers to mental as well as physical information seeking and processing activities which one engages in to facilitate decision-making. They can be: Prepurchase search Its the information search prior to any purchase after the recognition of the problem. Ongoing search It occurs when a consumer is searching with an interest in the product and not due to demand and is independent of specific needs or decisions. Internal Search It is done by Recalling information, experiences, and feelings concerning products and brands. Now we generally recalls products or a situation on the basis of: 1. Brands 2. Attributes 3. Experiences External Search The Consumers acquire information from outside sources and gets engaged in pre-purchase and ongoing search. Some of the external can be: 1. Retailer search 2. Media search 3. Interpersonal search 4. Internet source Factors affecting external search behavior Market conditions Buying strategies Individual factors Open-mindedness, self-confidence, Socio-economic conditions like the education and income, and Consumer market beliefs. Situational factors 1. The urgency of need or the time pressure on the purchase. 2. Store conditions (layout and design) 3. Special opportunities arise due to any off-season discounts or attractive prices. Perceived risk. Prerna garg 4

Consumer behavior 1. 2. 3. 4. 5. Monetary risk Functional or performance risk Physical risk Social risk Psychological risk ( fear of guilty, poor self concept or vice versa) EVALUATION OF ALTERNATIVES It involves all those activities undertaken by the consumer to appraise the alternatives carefully in respect to each other on the basis of certain criterion. . When consumers evaluate the alternatives, consumers tend to use two types of information: A list of brands from which they plan to make their selection (the evoked set) The criterion they will use to evaluate each brand. 1. Evoked set refers to the specific brands a consumer considers in making a purchase within a particular product category. 2. Inept set consists of brands the consumers exclude from purchase consideration because-they feel it to be unacceptable. 3. Inert set consists of brands the consumer is indifferent towards because they are perceived as having not many advantages.

The brand may be unknown because of the consumers selective exposure to advertising media ad stimuli. Brands may be unacceptable because of poor qualities or attributes or inappropriate positioning in either advertising or Product characteristics. Brands may be perceived as not having any special benefits and are regarded indifferently by the consumer. Brands may be overlooked because they have not been clearly positioned or sharply targeted at the consumer market segment. Brands may not be selected because they are perceived by consumers as unable to satisfy perceived needs as fully. Prerna garg 5

Consumer behavior FACTORS AFFECTING EVALUATION OF ALTERNATIVES Urgency of the need Significance of the product Complexity among the alternatives.

Consumer purchasing process

Reasons for shopping Personal motives 1. Role playing 2. Diversion from the daily routine 3. Self satisfaction 4. Learning new trends 5. Physical activity Social motives 1. Enlarging interaction with people 2. Peer group attraction 3. Status exhibition 4. Pleasure of bargaining

CHOOSING A STORE FACTORS DETERMINING STORE CHOICE Store location Store design and physical facilities Merchandise Promotional activities Personnel Customer services

IN-STORE PURCHASING BEHAVIOR A number of factors influence a consumers buying behavior within the store like: Store layout and traffic pattern Point-of-purchase media- special displays like electronic equipments are used to attract the attention of consumers to one or more products. Product shelving- It includes the appropriate size and height of the shelves, the number of rows, their facing, the shelf sign-boards etc. Pricing strategies Packaging Personal selling effects. Prerna garg 6

Consumer behavior NON-STORE PURCHASING Marketers usually refer to it as non-store marketing or direct marketing. It includes, personal selling, TV, radio, tele-shopping, catalogues, direct mails etc. POST PURCHASE BEHAVIOR This stage is very important from the consumers perspective. Firstly it serves to broaden the consumers perspective of his own experiences stored in their memory. Secondly, it provides a check on how well he is doing as a consumer in selecting stores etc. CONSUMER SATISFACTION Satisfaction refers to the buyers state of being adequately rewarded in a buying situation for the sacrifice he has made. Adequacy of satisfaction is a result of matching actual past purchase and consumption experience with the expected reward from the brand. Consumers form certain expectations prior to the purchase. They may be about: The nature and performance pf the product/service The costs and efforts to be expended before the actual purchase The social benefits or costs accruing to the consumer as a result of the purchase

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Consumer behavior EVALUATION OF ALTERNATIVE S

PURCHA SE

PRODUCT EXPECTATI ON

CONFIRMATION OR DISCONFIRMATI ON

PRODUCT PERFORMA NCE

SATISFACTI ON

DISSATIS FACTION

Consumer complaint behavior As a result of consumer dissatisfaction, they may exhibit unfavorable word-of mouth communication. Such behavior damages the companys image. Secondly the consumers may not re purchase the brand and the third is a complaining attitude. Post purchase dissonance It occurs as a result of a wide discrepancy between the consumers decision and the consumers prior evaluation. Dissonance theory was based on two basic principles: Dissonance is uncomfortable and will motivate the person to reduce it Individuals experiencing tends to avoid such situations further. Conditions causing dissonance End of the minimum threshold of dissonance tolerance. When the action is irreversible Unselected alternatives were more attractive Lots of better substitutes Purchase pressure on the consumer at the time of purchase HOW TO REDUCE DISSONANCE Prerna garg 8

Consumer behavior Changing product evaluation Reevaluating the alternatives as to be almost the same so that it makes very little difference which one is chosen. Selective retention

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