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A Review Study on Consumer Behaviour

Miss. Riya B. Agrawal Dr. Rajesh Kumar Pandey


MBA 2nd Year Student (Mkt.) Associate Professor
SSR IMR, Silvassa, SSR IMR, Silvassa
Affiliated to SPPU, Pune Affiliated to SPPU, Pune
Email: riyaa8784@gmail.com Email: rajesh.pandey@ssrimr.edu.in

ABSTRACT

Consumer Behaviour is one among the essential factors that surrounds the marketing
function. Consumer Behaviour is referred as the actions that are directly indicative of the
preferences & attitudes of the consumers towards the products. Consumer Behaviour gets
reflected not just during the purchase instead it precedes the purchase function & also follows
the function. The learning on Consumer Behaviour by the Industries encapsulates the study of
Consumer group comprising of Individuals & Institutions pertaining to the actions they
demonstrate towards usage and disposal of products, services & other related aspects. The
studies on Consumer Behaviour have focused on the essential factors that influence the
purchasing behaviour of consumers. Such factors quite noticeably are: Social, Cultural,
Personal and Psychological factors. In the era when the consumers are purchasing products
not just for its utility instead for perceived worth – understanding Consumer behaviour
becomes pretty essential for organisations.

The scope of the paper encompasses seeking & disseminating understanding on the concept
of Consumer Behaviour while reviewing the literature available on the theme of consumer
behaviour. It is a descriptive study conducted through the help of secondary data. The authors
have reviewed the selected literature & drawn inferences which may be indicative in nature &
not exhaustive. Being a study on generalist aspect of the concept of Consumer Behaviour
may lead to limitation of the study and extend a future scope of the study pertaining to
specific study in the field of Consumer Behaviour through the help of Primary Data.
Consumer Behaviour study is an intrinsic part of Marketing function. A well defined
behavioural aspect of consumers may reflect in the success of not just the specific firm but
overall Industry.

Key Words: Consumer Behaviour, Consumer buying behaviour, Models of Consumer


Behaviour

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INTRODUCTION

The aim of marketing is to know and understand the customer so well the product
or service fits him and sells itself."
- Peter F. Drucker, Author and Management Thinker

The Need for the study of Consumer Behaviour is perhaps as old as the concept of
Marketing. The world of Marketing is very dynamic and understanding every facet of
Marketing becomes an essential aspect for Industries. The function of Marketing has been
witnessed to start with the need generation and potentially ends with the Customer
Satisfaction. So, the market is a place where the exchange takes place for any reason between
the buyers and sellers, where in the inevitable role is played by the “Consumers” in light of
the fact that buying of any item entirely relies upon the purchasing behaviour of the consumer
or the customer. When everything revolves around the customer then the study of consumer
behaviour becomes a necessity, as the most focused area in every field of business and
services. (www.wisdomjobs.com) Now a days, many business is trying to find out the
changing needs and preferences of consumer’s in today’s scenario. As a consumer, we are all
unique and this uniqueness is reflected in the consumption pattern process of our purchases in
respect of different preference, likes, taste, dislikes and adopt a different behavioural patterns
while making up a purchase decision. Consumer Behaviour is the behaviour that consumer
display in scanning for purchasing, using, evaluating and disposing of products and services
that they expect will satisfy their needs. (https://research-methodology.net)

The study of consumer behaviour provides us with reasons why consumers differ from one
another in terms of evaluating, buying, using products and services. It is concerned with what
consumers purchase, yet in addition with why they buy it, when and where and how they buy
it, and how often they buy it, and also how they consume it & dispose it. Even we see the
environmental influences to Consumer behaviour like social, cultural & personal factors.
Consumer behaviour seem to have individual determinants in the form of personality,
motivation & involvement, learning and attitude of customers. Hence, it also enhances
marketers & future marketers to understand and predict buying behaviour of consumers in the
marketplace and can shape their marketing strategies accordingly. As said by Professor
Theodore Levitt of the Harvard Business School, the study of Consumer Behaviour is one of
the most important aspect in business area, because the purpose of a business is to create
and retain customers (www.wisdomjobs.com). This recommends that Customers are created
and maintained through marketing strategies and perhaps the knowledge & information about

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consumers is important for developing successful marketing strategies as marketers face the
challenges to think about and analyse the relationship with the consumers, and the consumer
behaviour & the marketing strategy.

OBJECTIVES OF THE STUDY

The Authors have considered the following objectives for the study:
To understand the essentials of Consumer Behaviour
To perform literature review on literary sources i.e., Books, Articles & Research
Papers pertaining to consumer behaviour experienced across the Industry.
To refer & review the existing models of consumer behaviour and recommend a
Model of consumer behaviour towards purchase decision.

SIGNIFICANCE OF THE STUDY

Consumer Behaviour has already attracted the larger quotient of marketing thoughts. The
basic motto for developing & marketing a product is to solve existing problem in the market
and satisfy the needs of the Consumers. Significantly, the study of consumer behaviour
supports this motto and ensures a smooth path for the business. It enables the marketers to
acknowledge, recognize and foresee the buying actions of a consumer. However Consumer
Behaviour not necessarily only reflects the learning on what consumers buy but also the
complete action as to why, when, where, and how often they buy it. Consumer behaviour also
has huge impact on the entire distribution system. Learning of consumer behaviour is
beneficial for not just the Business owners instead for middlemen and also to salesperson to
perform their tasks effectively in meeting consumers’ needs. The consumer behaviour
enables the organisation in analysing market opportunity, selecting target market and
supporting the overall Marketing Mix. The elements of Consumer Behaviour are essentially
required to be studied in order to sustain the competitive business environment. Consumer
behaviour learning may be considered the based for the learning of consumer perception,
attitude, culture, life styles, consumer experiences and over all purchase decision making.
The huge scope of the concept of Consumer Behaviour in market domain, its relative
advantages and profound business preposition signifies the rationale behind the study of
Consumer Behaviour.

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RESEARCH METHODOLOGY

A Review Study on Consumer Behaviour is a descriptive study conducted with the help of
Secondary Data. The study aims at understanding the essentials of Consumer Behaviour and
to perform literature review on articles & papers pertaining to consumer behaviour
experienced across the Industry. As part of the literature review 17 sources have been
referred to gather understanding and knowledge on Consumer behaviour. The scope of the
study entail the understanding based on the review of the contributions from various authors
on the theme of Consumer behaviour. The study has the scope of extending further literature
for review on the theme of Consumer Behaviour. The Authors have considered the consumer
behaviour at large rather segmenting to any specific industry; this may be a major limitation
of the study and forms the future scope of the study.

RESEARCH PROCESS:
The study was massively conducted with the help of Secondary data collected from various
sources. The Authors have followed the following Research Process to complete the literary
work:

Chart No. 1: Research Process adopted for the study


Source: Authors Study

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LITERATURE REVIEW

Consumer Behaviour is an essential attribute to be studied as it is worth understanding the


fact that the behaviour of consumer has the tendency to change on intervals for specific
products. The Authors have presented the literature review & categorised the same under the
following heads: Consumer Behaviour: Preferences & Attitude, Consumer Behaviour:
Influencing Elements, Consumer Behaviour: Demographic Factor and Impact created on
Consumer Behaviour.

Chart No. 2: Consumer Behaviour: Literature Review Categorization


Source: Authors Review Study

a) CONSUMER BEHAVIOUR: PREFERENCES & ATTITUDE


Consumer Preferences & attitude need to be understood in order to serve the consumers
better. Consumer buying behaviour is the sum total of a consumer's attitudes, preferences,
intentions, and decisions regarding the consumer's behaviour in the market place when
purchasing a product or service. Consumer makes buying decision every day and many
people don’t even know the factors which drive them to this decision. Usually the factors
affecting consumer buying behaviour include psychological, social, cultural, and personal
factors. (Ramya & Ali 2018) Dr. Muthu C. Velayutham & Abdul A. Brosekhan express
their thought on the term, ‘consumer’ refers not only to the act of purchase itself, but also
to patterns of aggregate buying which include pre-purchase and post-purchase activities.

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Pre-purchase activity might consist of the growing awareness of a need or want, and a
search for and evaluation of information about the products and brands that might satisfy
the consumers whereas, the post-purchase activities include the evaluation of the
purchased item in use and the reduction of any anxiety which accompanies the purchase
of expensive and infrequently-bought items.

The Consumer attitude has potential to get influenced with change in geographic region
however the same may not be that dominant. A study on consumer behaviour for food
products in India from different perspectives was attempted in north India. Respondents
accepted the fact that their food habits get affected with the shifting to a new region but
many basic buying and consumption behaviour do not change. Some of the changes in
buying and consumption behaviour of relocated people, which were observed after their
settlement to a new region, were not significantly different from the level of changes in
behaviour of non-moving people. (Gupta, 2009) The studies have proved that relational
and subjective elements of service are most influential to Consumer behaviour. In a retail
atmosphere Smiling and making eye contact, giving the customer full attention, being
respectful, and conveying a measure of importance are critical factors. It may considered
that personal elements of service may be of critical importance in cultivating new
customer relationships. (Roberts & Campbell, 2006) Indian Banking Industry has made
an attempt to ascertain the level of awareness among the respondents about the retail
banking services, to measure the level of satisfaction regarding retail products and
services and to offer suggestions to expand the retail market through improved customer
services. The study based on 60 customers each from SBI and Indian Overseas Banks are
selected on convenience sampling method. The study reveals the customers were highly
aware of most of the retail banking products except some like home banking, telebanking
and institutional financing. It also reveals that routine operations factors are highly
influencing the satisfaction level of the customers. The study concludes retail banking
offers phenomenal opportunities for growth and development, the challenges are equally
formidable. How far the retail banking is able to lead the growth of banking industry in
future would depends upon the challenges and how it makes use of the opportunities
effectively. (Revathy B. 2012) Customer is key to the business decisions. Talking about
the Consumer preferences & attitude in the Banking sector, post economic liberalisation,
Banks started providing tailor made services to the changing needs of the ultra-modern
customer to face the stiff competition from the rival banks. Today the customer services

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preference keep on changing at a rapid speed and their demands. To achieve the highly
challenging task of customers satisfaction bankers are turning to technology for help.
Bankers are not only satisfying the customer but must also trigger the attitude of the
customers towards the bank. (Alagarsamy & Wilson, 2013)

b) CONSUMER BEHAVIOUR: INFLUENCING ELEMENTS


Consumer Behaviour is prone of being influenced by the various factors. These factors
influence the consumer behaviour leading to impact on purchase decision making. The
Researchers in their respective studies have noticed that due to the use of internet online
shopping is growing worldwide. Marketers are trying to understand the online buying
behaviour of Indian customers so that they can find out new ways of identifying various
profitable customers and targeting them better. Nowadays, the social networking is also
growing rapidly and is especially popular amongst homemakers. An empirical study
through online survey was conducted on 56 homemakers in the age group of 25-45 years
in western suburbs of Mumbai. After examining the attitudes of homemakers towards
online shopping it was observed that homemakers are utilitarian. Shopping for them is an
experience, leisure activity to reduce their boredom. Most of the homemakers prefer to go
to mall and spend money liberally but spend very conservatively online. The certain
factors such as to touch and feel the product, enjoy market place, interaction with sales
person, instant satisfaction of purchasing products are missing in online shopping. As a
result of this, offline shopping is more preferable than online because offline shopping
leads to impulse buying and immediate satisfaction. The study also reveals that the
influence of social media is limited to creating awareness, generating curiosity leading to
information search. It does not influence homemakers to buy. (Varma & Agarwal, 2014)

The Customer Satisfaction may also get aimed through understanding the consumer
behaviour. The studies have revealed that customer satisfaction, a transaction-specific
attribute, is dependent on nine different factors i.e. Tangibility, E-fulfillment, Convenience
& Availability, Accuracy, Responsiveness, Empathy, Promptness, Personal Assistance.
An independent study conducted on Banks stated that the learning on consumer behaviour
may not only lead to achieve customer satisfaction instead it will help in strengthening the
bond between the banks and their customers, thereby helping the banks to retain and/or
expand their overall customer base. Today, customers expect higher quality services from

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banks which, if fulfilled, could result in significantly improved customer satisfaction, and
potentially retention levels. (Chavan & Ahmad, 2013)

The study of consumer buying behaviour has become an integral part of strategic market
planning as even the customer plays three distinct roles of user, payer and buyer.
Consumer behaviour has always been a great interest for marketers to understand how
consumers think, feel and select from various alternatives products, brands and how they
get influenced by the environment like - cultural, social, personal and psychological
factors. Also lifestyle impacts the consumer buying behaviour. (Naranje & Pawar 2015) It
has been witnessed that over past years, demand for consumer durables has raised with
rising income levels, changing lifestyles, increasing consumer awareness and introduction
of new model. The products like air conditioners are no longer perceived as luxury
products. Such behavioural changes are the resultant of dynamic environment in the
market. (Deshpande & Saxena 2017) In organizations when it comes to marketing
strategies, the customer is the ‘core’. Thus it is necessary for marketers to plan the
motives of price, purchasing, payment mode, and delivering method in such a manner that
suits customers. (Khaniwale, 2015)

Consumer Behaviour has been defined as “those acts of individuals directly involved in
obtaining, using, and disposing of economic goods and services, including the decision
processes that precede and determine these acts”. Consumer behaviour is a complex area,
but marketers try to find out as much as they can about who are their customers in order
to identify their needs, how they behave, what influences them to make a decision to buy
and what processes they follow when selecting a product/service. This information is
required so that marketers can target their marketing activities as precisely and cost
effectively as possible. There are many influences on purchasing behaviour of consumers,
including social, cultural, personal and psychological factors. (Madhavan & Chandrasekar
2015)

c) CONSUMER BEHAVIOUR: DEMOGRAPHIC FACTOR


Demography has an impact on the consumer behaviour. The studies have proved the
same. The consumers in different age bracket have different personalities and
demonstrate different set of values. An Independent study on packaged food states that

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the factors for selecting packaged food include health, convenience, proximity, mood,
price, brand, and sensory appeal. Additionally, it is found that three factors, namely,
health, convenience and mood, have significant relationship with age, and four factors,
namely, health, mood, price and brand, have significant relationship with monthly
income. (Bhatt & Bhatt 2015) The Marketers need to tap this advantage of studying the
consumer behaviour aspect from demographic view point. This enables to place the
product in respective category of the market.

d) IMPACT CREATED ON CONSUMER BEHAVIOUR


The studies on Consumer Behaviour necessarily encompasses the learning of the impact
created through the demography, Consumer Preferences & Attitude, Quality &
Innovation and existing Models of Consumer Behaviour. It has evolved over the years
that consumer experience is the key factor for future purchases. Consumer Behaviour is a
dynamic aspect having the potential to magnetise businesses. The main purpose behind
marketing a product is to satisfy demands and wants of the Consumers. Study of
consumer behaviour helps to achieve this purpose. (Bhalerao & Pandey 2017) It has been
established through studies that Ethical Behaviour, listening ability, relational skills and
emotional intelligence impacts purchasing behaviour of the customer. The studies have
also indicated that the soft skill of a salesperson, which is otherwise disregarded,
influences the consumer behaviour. It is considered that the behaviour of the customers
may get controlled by the action of sellers. (Punwatkar & Verghese, 2014)

In modern context the Business decisions like customer service, marketing strategies,
human resource management etc. are being used with the help of Information
Technology (IT). IT has a great influence on consumer purchase behaviour. (Narwal &
Sachdeva, 2013) Learning the Consumer behaviour function is essential to develop
appropriate marketing strategy. (Lovelock & Writz 2012)

Table No. 1: Definitions on the theme Consume Behaviour


Author (Year) Definition
Solomon, et al. (1995) Consumer Behaviour is 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.”

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Loudon and Bitta (2004) Consumer Behaviour is “the decision process
and physical activity engaged in when evaluating,
acquiring, using or disposing of goods and
services.”
Batra & Kazmi (2004) “Consumer behaviour is mental and emotional
processes and the observable behaviour of
consumers during searching purchasing and post
consumption of a product and service.”
Engel, Blackwell and Miniard “Those actions directly involved in obtaining,
(2006) consuming and disposing of products and services
including the decision processes that precede and
follow these actions” is referred as Consumer
Behaviour
Schiffman and Kanuk (2007) “Consumer Behaviour is the behaviour that
consumers display in searching for, purchasing,
using, evaluating, and disposing of products and
services that they expect will satisfy their needs.”
Hawkins, Best, and Coney (2007) Consumer behaviour can be defined as “the
study of individuals, groups or organisations and
the processes they use to select, secure, use and
dispose of products, services, experiences or ideas
to satisfy needs and the impacts that these
processes have on the consumer and society.”
Stall worth (2008) Consumer behaviour can be defined “as a set of
activities which involves the purchase and use of
goods and services which resulted from the
customers’ emotional and mental needs and
behavioural responses.”
Kumar (2010) Consumer buying behaviour “refers to the
buying behaviour of final consumers, both
individuals and households, who buy goods and
services for personal consumption.”

Kotler and Keller (2011) Consumer buying behaviour is the study of the
ways of buying and disposing of goods, services,
ideas or experiences by the individuals, groups
and organizations in order to satisfy their needs
and wants.

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Literature Review Validity Testing

Word Frequency
Summary

Word Count
Consumer 1358

Behaviour 838

Buying 930

Products 633

Customer 586

Marketing 593

Study 700

Making 874

Factors 473

Service 513

Source: Word frequency & Word Cloud developed through NVivo Plus Software by exploring the
documents considered for Literature Review

Exhibit – 1:
Implication of Consumer Behaviour Models - Howard Sheth Model and Engel –
Blackwell – Miniard Model.

Implications of Howard Sheth Model


The model suggests that the learning, perception and attitudes influence the consumer
behaviour. The model emphasizes on three aspects towards the overall Model: Input,
Constructs and Output. These all are variables at their respective stages. The Input
considered in the model is the Stimuli in the form of: Significative stimuli: Tangible
characteristics of the product in the form of Quality, Price, Distinctiveness, services rendered
& availability of the product. Symbolic Stimuli: The characteristics in the significative stimuli
get influenced by their promotions. The motivation created through this process is termed as
symbolic stimuli. Social Stimuli: Motivation & influences generated through the family,
friends and social groups. The Model establishes reach to many variables that influences the
consumer’s decision. It helps the Marketers to frame strategy considering the various aspects
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that influences customers at every stage of their behaviour. It highlights that the outcomes of
consumers decision may not necessarily be the purchase of the product instead it may be non-
purchase. Accordingly it assists the marketers to tackle defection. Although the Model
attracts a limitation in terms of its complex arrangement yet the same turns out to be a
strength as it is robust and comprehensive.

Implications of Engel – Blackwell – Miniard Model


The Model was originally contributed by Engel – Kollat – Blackwell and with more of
contribution in this respect finally the Model was prescribed with the contribution of Miniard
& termed as Engel – Blackwell – Miniard. This Model is a multidimensional effort towards
coordination among the perceptual pattern of buyers reflected in their decision making
process. Just as Howard Sheth Model even this model highlights that the High engagement
purchases requires complex decision process. This model reflects the Input in terms of the
Stimuli towards purchase leading to Information processing & assisting the Purchase decision
process. The Decision process simultaneously also get influenced by the Environmental
influencers and Individual differences. This model is slightly less complex than Howard
Sheth Model however this model also comprehensively involves various variables as
determiners of purchase. This model effectively involves the Consumer decision Making
process and marketers have every opportunity to learn the attributes that influences the
purchase decision process.

Source: (Bhalerao & Pandey, 2017). Consumer Behaviour: Literature Review, IJETSR, Vol.
4, Issue 8, Aug’17.

RECOMMENDATION:

Consumer Behaviour towards Purchase decision has been a talked about topic and literature
suggests that authors have delivered their insights in this regard. In the present study the
authors have reviewed existing models of Consumer Behaviour suggested as Howard Sheth
Model and Engel – Blackwell – Miniard Model. The Howard Sheth model emphasizes on
three aspects towards the overall Model: Input, Constructs and Output. The other model is a
multidimensional effort towards coordination among the perceptual pattern of buyers
reflected in their decision making process. The study proposes a model on consumer
behaviour towards purchase decision whereby the basis of the model is referred from the

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existing models however the recommended model is less complex as against the existing
model and also as against the existing models, this model accepts the experience of the
consumers as part of the process rather just result of purchase.

R2 CB Model of Consumer Purchase decision

Source: Self developed Model based on the learning from existing consumer behaviour model.

CONCLUSION:

Consumer Behaviour refers to the study of understanding buying behavioural patterns of


consumers while making a purchase decision. The study meets its objective of demonstrating
the learning through conceptual review of Consumer behaviour related studies. The Literature
review is categorised under the following heads: Consumer Behaviour: Preferences &
Attitude, Consumer Behaviour: Influencing Elements, Consumer Behaviour: Demographic

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Factor and Impact created on Consumer Behaviour. The respective sections have contributed
towards exploring knowledge on the consumer behaviour domain. Such studies of consumer
behaviour have potential to help marketers to recognize and predict the purchase behaviour of
the consumers. The recommended model in the study supports the understanding on the
consumers buying behaviour. The Model links the Buying Motive with Actual purchase and
resulting into an experience that guides further purchase decisions. The reference of the
existing consumer behaviour model supports the momentum of the study. The linkage &
connect presented in the Model demonstrates the flow of the purchase decision taken by the
consumers. As discussed and defined in the study, Consumer behaviour is an essential
attribute to be studied by the Organisation in order to place their Marketing domain in the
right sphere and guide the overall business in right direction.

FUTURE SCOPE OF STUDY


The current study is a literature review pertaining to the Consumer Behaviour aspects across
industries. This potentially is the limitation of the study as well. Such studies do have
potential for theoretical understanding however it just reflects the prevailing knowledge &
existing literature. There is certainly a good future scope to such approaches. Potentially field
survey on selected segment of products and recording the respective behaviours of the
consumers may form the future scope of study. The study may be conducted for a specific
gender or across the genders for desired set of products with a representative sample that
eventually leads to the suggestive inferences.

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