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CONSUMER BEHAVIOUR
A customer is the most important visitor on our premises. He is not dependent on us.
We are dependent on him. He is not an interruption on our work. He is the purpose of it
and not an outsider on our premises. He is a part of it. We are not doing him a favour by
serving him. He is doing us a favour by giving us the opportunity to do so.
! Mahatma Gandhi
Customer Vs Consumer
"he term #customer$ and #consumer$ have been used synonymously most of the
time. "he term customer refers to the purchaser of a product or service whereas the term
consumer refers to the end user of a product or service. "he customer may or may not be
a consumer. %imilarly the consumer may or may not be the customer.
Definitions
Consumer behaviour is defined as activities people undertake when obtaining&
consuming& and disposing of products and services.
- Roger D. Blackwell, Paul W. Miniard and James F. Engel
%imply it can be stated that consumer behaviour is the study of why people buy.
Consumer behaviour has been referred to as the psychological& social and physical
behaviour of all potential consumers as they become aware of& evaluate& purchase and
consume and tell others about products and services.
- u!a R. "air
Obtaining: refers to the activities involved in purchase of a product. "he activities
include searching for information regarding product features& evaluating the alternatives&
and purchasing. 't also includes the place of purchase (shopping malls)nearest grocery
stores*& the mode of purchase (cash)credit card*& etc.
Consuming: refers to how& where& when and under what circumstances consumers use
products. How + as side dish or main dish, Where + place (home& office or restaurant*&
When + time (morning or afternoon or evening* and under what circumstances (happiest
moments or with friends or when alone*.
Disposing: refers to how they get rid of products and packaging. Whether they resell it
or give it to children or use it for different purpose.
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Consumer Behaviour [email protected]
Consumer behaviour can be said to be the study of how individuals make decisions on
how to spend their available resources (time& money& effort* on various consumption!
related items.
- u!a R. "air
"he above definition talks about various activities surrounding the ultimate
consumer and helps the marketer to gauge the consumer behaviour specifically focusing
on0
Who buys the products or services1
How do they buy products or services1
Where do they buy them1
How often do they buy them1
When do they buy them1
Why do they buy them1 And
How often do they use them1
"hese 2uestions will help in understanding better what factors influence the
decision making process of the consumers.
Consumer Behaiour ! for "hom#
't has been said that the field of consumer behaviour holds for various categories
of people such as consumers& marketers and students of marketing.
Consumers: All the firms have started considering #customer$ as the #king$ or #2ueen$.
'nterestingly& after liberali3ation of 'ndia$s economy& the market place is flooded with
many new players including the 45Cs$ resulting in the availability of more number of
brands in every segment of the market. 6n account of this& the customer has started
being choicy about what to buy. "hus all firms are becoming not only customer focused
but are also trying to build relationship with them. "his is done by continuously updating
knowledge& information and understanding of the customer needs and e7pectations.
Awareness of such devotion from the firm has made consumers to take more
interest into their own consumption related decisions. "hey are keen to gain more
knowledge about taking various decisions related to products and the promotional
influences that persuade them to buy. "hus the study of consumer behaviour will enable
them to become better and wiser consumers.
Mar$eters: have woken up to the reality that e7ist in a competitive environment and
hence they have to be more focused. "he marketers have observed that the choice
empowered customer cannot be taken for granted. "his is particularly true because of the
rapidly rising consumer earnings& sharp drop in the savings rate and increase in earnings
resulting in a huge amount of disposable income that are spent lavishly. %imultaneously&
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there are changes occurring in the personal& social and influences making consumer more
individualistic& conscious (about the products or services to fulfill their needs*. %o& the
study of consumer behaviour will help marketers to assess the consumers$ needs and
wants& and make better strategic marketing decisions.
Stu%ents: As students of marketing& one will be more concerned with the study of
consumer behaviour. %uch a study will help to gauge into the consumer$s mind and
understand the various consumption related aspects of individuals (consumers*. As
students of marketing& understanding of consumer behaviour will make the study of
#marketing management$ more interesting& understandable and increase awareness of its
practical implications.
Dee&opment of Consumer Behaiour as a 'ie&% of Stu%(
Consumer behaviour as a separate field of study gained attention from the /9:;s.
'n the absence of a history or a separate research of its own& this new discipline drew)or
borrowed concepts from other scientific disciplines such as +
<sychology (the study of individuals*
%ociology (the study of groups*
%ocio!psychology (the study of how persons are influenced by groups*
Cultural anthropology (the influence of the culture and society on the individual*
=conomics (the relationship between demand and supply in the flow of marketing
activity*
)ositiism: 'nitially& the study of consumer research was emphasi3ing from a managerial
perspective. 'n that& if the marketing manager could obtain consumption related
behaviour i.e.& if they are able to predict consumer behaviour& then they could influence
it. "his type of consumer behaviour approach came to be known as #$ositi%ism&.
Interpretism: A group of academicians who are interested in the study of consumer
behaviour and are more interested in knowing consumption behaviour going by the
influence of the various disciplines on the consumer behaviour. "his approach of
studying the consumer behaviour with a view on understanding consumption behaviour
and the interpretations of such behaviour is known as #inter$reti%ism or $ost-
modernism.&
"hese interpretivists have included many sub>ective aspects of consumer
behaviour such as the effect of moods& emotions& type of situations etc. "hese
interpretivists have also treated each purchase e7perience as uni2ue because of the many
variables which influence the behaviour at that particular moment of time. 6n account of
its focus on the consumption e7perience& the interpretive approach is also referred to as
#e'$erientalism&.
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Consumer Behaiour an% Mar$eting
Broadly& buyers can be classified into two ma>or categories0
Consumers (in the household sector& who buy goods or services for personal
consumption*
'ndustrial buyers (who purchase goods and services for carrying out activities in
the various industrial units*.
'n this age of information e7plosion& and internet marketing becoming a reality& it
is all the more necessary that they (marketers* go for the creation of appropriate database
which can help them to go for #tailor made$ products to suit individual tastes& preferences
and buying behaviour.
"he industrial or organi3ational markets consist of buyers who buy goods and
services needed in the process of furthering their industrial and institutionlal activities.
"he behavioural differences between the domestic consumers and industrial buyers can
be done on the basis of the ultimate ob>ective sought by them. While the domestic
consumers seek need satisfaction and value added by the purchase of the product& the
industrial buyers seek profit or measurement of improved operational efficiency. "he
latter$s behaviour& thus& will be influenced by the ob>ectives of the organi3ation they
serve. Accordingly there is also a difference in the buying process adopted by both the
domestic consumer and industrial buyer.
A ma>or implication of the differences in the consumer and industrial behaviour
for marketers is the relative emphasis to be placed on the various marketing mi7es to be
adopted by the concerned marketer. @nderstanding of the consumer behaviour will
enable marketers to design effective marketing strategy and programmes.
Consumer Mo%e&&ing
Mo%e&: A physical& visual or mathematical A.. %implified representation of a comple7
system.
A model is very often referred to as an abstract representation of a process or
relationship. We (human beings* hold various models in our minds which allow us to
make sense of the world and also help to predict the likely course of events. %imply
stated models help us in the following way0
"hey help in the development of theories
"hey help to understand comple7 relationships
"hey provide the framework for discussions and research work
"he primary concern is to use the models to understand consumer behaviour.
Consumer behaviourists as well as marketers are interested in understanding how and
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Consumer Behaviour [email protected]
why certain decisions are made. "he discussions have been about some of the important
models of consumer behaviour& which attempts to give a comprehensive view of all those
aspects of the buying situations which are deemed to be significant by their creators.
Mo%e&s of Consumer Behaiour
E*onomi* Mo%e&
@nder economics& it is assumed that man is a rational human being& who will
evaluate all the alternatives in terms of cost and value received and select that
product)service which gives him)her ma7imum satisfaction (utility*. Consumers are
assumed to follow the principle of ma7imum utility based on the law of diminishing
marginal utility. 't is assumed that with limited purchasing power& and a set of needs and
tastes& a consumer will allocate his)her e7penditure over different products at given prices
so as to ma7imi3e utility. Being a rational creature man will make his purchase decisions
with the intention of ma7imi3ing the utility)benefits.
=conomic model is based on certain predictions of buying behaviour
i. Csser the price of the product& more will be the 2uantity purchased ($rice e))ect*
ii. Cesser the price of substitute& lesser will be 2uantity of the original product
bought (su+stitution e))ect*
iii. 4ore the purchasing power& more will be the 2uantity purchased (income e))ect*
+earning Mo%e&
@nlike the economists& classical psychologists have been interested in the
formation and satisfaction of needs and tastes. "hey argued that living beings were
influenced by both innate needs such as the primary needs of hunger& thirst& se7& shelter
and learned needs like fear D guilt. A drive (internal stimulus* which when directed
towards a drive reducing ob>ect becomes a motive. "he various products or services will
act as a stimuli to satisfy drives. Eor instance& a hungry person will be driven towards
food& which after consumption will reduce the drive and provide satisfaction. According
to learning theorists& this response of satisfaction (feeling* reinforces the relationship
between drive and the drive reducing stimulus ob>ect as well as the related cues. Eurther&
when consumers learn to associate connection between stimulus and response& it becomes
a habit. "here are certain cognitive theorists& who have advocated that human beings not
only learn to link stimulus with response (%!F* but also results in the formation of other
cognitive processes such as attitudes& values& beliefs& motivation etc.
'n marketing conte7t& #learning$ help marketers to understand how consumers
learn to respond in new marketing situations& or how they have learned and responded in
the past in similar situations. .ery often it is observed that consumer$s e7perience with
one product from a firm is likely to be generali3ed to the other products of the firm.
Conversely& consumers also learn to discriminate and this information will be useful in
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Consumer Behaviour [email protected]
working out different marketing strategies. %imply stated this learning model will help
markters to promote associations of products with strong drives and cues and positive re!
inforcements.
)s(*hoana&(ti* Mo%e&
"his model is based on the work of psychologists who were concerned with
personality. "hey were of the view that human needs and motives operated at the
conscious as well as subconscious levels. "his theory was developed by %igmund Ereud.
According to him human behaviour (personality* is the outcome of
(a* #id$ + the source of all psychic energy which drives us as action
(b* #super ego$ + the internal representation of what is approved by the society
(c* #ego$ + the conscious directing #id$ impulses to find gratification in a socially
accepted manner. "hus& we can say that human behaviour is directed by a
comple7 set of deep seated motives.
Erom marketing point of view this means that buyers will be influenced by
symbolic factors in buying product. 4otivational research has been involved in
investigating motives of consumer behaviour so as to develop suitable marketing
implications accordingly. 4arketers have been using this approach to generate ideas for
developing product + design& features& advertising and other promotional techni2ues.
So*io&ogi*a& Mo%e&
According to this model the individual buyer is a part of the institution called
society. %ince he is living in a society& he gets influenced by it and in turn also influences
it in its path of development. He is playing many roles as a part of various formal and
informal associations or organi3ations i.e.& as a family member& as an employee of a firm&
as a member of a professional forum and as an active member of an informal cultural
organi3ation. %uch interactions leave some impressions on him and may play a role in
influencing his buying behaviour.
'ntimate groups comprising of family& friend and close colleagues e7ercise a
strong influence on the life style and the buying behaviour of an individual member. "he
peer group plays a very important role in acting as an influencing factor especially in
adopting particular life styles and buying behaviour patterns. "he group generally has an
informal opinion leader& whose views are respected by the group. "his leader is able to
influence the members life style and buying decisions. "he marketers through a process
of market segmentation can work out on the common behaviour patterns of a specific
class and group buyers and try to influence their buying pattern.
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,he Ho-ar% Sheth Mo%e& of Bu(ing Behaiour
"his model basically serves two purposes0
i. 't indicates how comple7 the whole 2uestion of consumer behaviour really is.
ii. 't provides the frame work for including various concepts like learning&
perception& attitudes etc.& which play a role in influencing consumer
behaviour.
Inputs: 'n the Howard + %heth theory& the most significant stimulus affecting the buying
behaviour are the information cues about the characteristics of the product. "hese cues
may be signi)icati%e if it comes to the buyer from the product itself when he is involved
in a shopping activity. A similar set of cues& which are s,m+olic in nature may also act as
information sources.
Both these significative and symbolic information cues represent the firms marketing
efforts. "he product or broad characteristics acting as information cues are 2uality& price&
distinctiveness& service and availability. "here are impersonal sources like mass media
communication and advertising& over which the firm has no control. However& the
information sources also include sales and service personnel who can add and help the
marketing efforts of the firm. "he third source is social information cues which could
affect buying behaviour towards the product or brand and these include family& friends or
other members of the groups with whom buyer comes into contact or to which he aspires
to be in. "his social source is personal and the company)marketer has no control over
this source.
)ersona& .So*ia&/ Impersona&
Commer*ia& (a* %alesmen
(b* %ervice personnel
(a* <roduct (%ignificative*
(b* Advertising (%ymbolic*
Non Commer*ia& (a* Eamily
(b* Feference groups
(c* %ocial class
(a* <rint media (5ew %tories*
(b* 'ndependent "esting such
as consumer reports
)er*eptua& Constru*ts
"his refers to all the comple7 states or psychological processes (perception* and
how the individual deals with the information cues received from various sources. 't can
be seen that all information available is not attended to (attention* and may not always be
crystal clear in its meanings (stimulus ambiguity*. Although the individual may be
engaged in an overt search for information& sometimes he)she may be bombarded with
unwanted information. 4oreover& any information cues to which the individual may
attend may be distorted (perceptual bias* as a result of his own frame of reference.
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Consumer Behaviour [email protected]
+earning Constru*ts
"he second set of hypothetical constructs in this theory are more comple7 and
numerous. #4otives$ refers to the goals the individual attempts to achieve through
his)her buying behaviour. "hese goals are derived from the various drives (needs* which
may be acting as a cue for his)her motive.
4ore closely related to the buyers intention is his attitude towards the
product)brand. Whether he)she has formed a positive attitude and if not will there be a
change in the attitude etc.& are some of the factors which may affect the attitude an
individual has towards the product)brand.
6ther learning constructs include #brand comprehension$ i.e.&
knowledge)awareness about the brand characteristic features that forms the basis for the
buyers evoked set of alternatives, choice criteria& and the confidence the individual has
about his)her brand comprehensions& attitudes or intentions. Einally& the model includes a
construct& #satisfaction$. "his refers to feedback mechanism& i.e.& the post purchase and
post use evaluation of the output of the process.
E0ogeneous Variab&es:
"his theory also includes a number of variables which are not e7plained but have
a bearing on some or all of the constructs discussed above and indirectly influences the
output or consumer response.
i1 So*ia& an% Organisationa& Setting: 4an is basically a social animal. Because of his
interactions with various groups and society& they look to each other for guidance
regarding what to buy& how to buy)dress etc.
ii1 So*ia& *&ass: 'n order to conform to the norms of the social class to which he)she
belongs& the individual will be engaged in a behaviour which will be acceptable to the
social class to which he belongs.
iii1 Cu&ture: refers to the shared& somewhat consistent pattern of behaviour of a group of
people. =ach culture has a set of beliefs& values& etc. %o the pattern of buyer behaviour
will be based on a pattern of behaviour shared in a specific subset of larger culture + a
subculture trait.
i1 )ur*hasing po-er2'inan*ia& status: "he money)income available for purchasing
goods and services during some specified time period also plays a role in influencing the
consumption pattern and thereby his buying behaviour.
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Consumer Behaviour [email protected]
,he Nio*osia Mo%e&
'n the last recent years marketing scholars have build behaviour models taking the
marketing man$s point of view. "he 5icosia model is one such buyer behaviour model.
't also is said to be a systems model& because the human being is analysed as a system&
with stimuli as the input to the system and the human behaviour as an output of the
system.
"his model was developed in /9::& by Erancesco 5icossia& an e7pert in consumer
motivation and behaviour. "he 5icossia model tries to e7plain buyer behaviour by
establishing a link between the organi3ation and its (prospective* consumer. "he model
suggests that messages from the firm first influences the predisposition of the consumer
towards the product or service. Based on the situation& the consumer will have a certain
attitude towards the product. "his may result in a search for the product or an evaluation
of the product attributes by the consumer. 'f the above step satisfies the consumer& it may
result in a positive response& with a decision to buy the product otherwise the reverse may
occur. "his is in brief about the activity e7planations in the above model.
"he 5icosia model& groups the above activity e7planations into four basic areas +
Eield one has two sub areas + the consumers attribute and the firm$s attributes. "he
advertising message sent from the company will reach the consumer$s attributes.
Jepending on the way& the message is received by the consumer& a certain attribute may
develop. "his newly developed attribute becomes the input for Area two.
"he second area or area two + is related to the search and evaluation& undertaken by the
consumer& of the advertised product and also to verify if other alternatives are available.
'n case the above step results in a motivation to buy the product)service& it becomes the
input for third area.
"he third area e7plains how the consumer actually buys the product.
And area four is related to the uses of the purchased items. "his fourth area can also be
used as an output to receive feedback on sales results to the firm.
"ebster an% "in% Mo%e& of Organisationa& Bu(ing Behaiour
"his is a comple7 model developed by E.=. Webster and K. Wind& as an attempt
to e7plain the multifaceted nature of organi3ational buying behaviour. "his model refers
to the environmental& organi3ational& interpersonal and individual buying determinants
which influences the organi3ational buyer(s*. "hese determinants influences both the
individual and group decision making processes and conse2uently the final buying
decisions. "he organi3ational determinant is based on Harold Ceavitt$s four elements of
organi3ation buying vi3.& people& technology& structure and task.
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An individual engaged in buying for organi3ations may be involved in one or
more of the following buying roles0
Users: "he ultimate users who often initiate the buying process and help in defining
specifications.
Inf&uen*ers: "hey may or may not be directly connected with the decision. But their
views or >udgements of a product or a supplier carry a lot of weightage.
Bu(ers: "hose people who negotiate the purchase.
De*i%ers: "he people who take the actual decision (they may be formal or informal
decision makers*
3ate 4eeper: "he person who regulates the flow of information.
"his model is a valuable contribution and helps in revealing the whole range of
direct and indirect influences which affect the organi3ational buying behaviour.
However& the limitation is that this model provides a static representation of a dynamic
situation.
,he Enge& ! 4o&&at ! B&a*$-e&& Mo%e&
"his model talks of consumer behaviour as a decision making process in the form
of five step (activities* which occur over a period of time. Apart from these basic core
steps& the model also includes a number of other related variables grouped into five
categories.
Step 5: )rob&em Re*ognition: "he consumer will recogni3e a difference between his or
her actual state and what the ideal state should be. "his may occur on account of an
e7ternal stimuli& for e7ample a young girl has seen an ad of an e7hibition of American
Jiamonds and may feel the desire to possess the same or seeing a beautiful dress
displayed in the show!room may make a youngster to feel the need for a new dress.
Step 6: Information Sear*h: 'nitially the information available with the consumer may
be consistent to the beliefs and attitudes held by him or her. While being involved in an
information seeking or search stage& the consumer will try to gather more information
from various sources. "hese sources could be sales persons& personal or friends or
neighbours or mass communication media. "he information processing takes place in
various stages. "he individual gets e7posure of the stimuli which may catch his or her
attention& be received and stored or retained in memory. "his method of information
processing is selective in nature and the consumer will accept the information which is
conclusive to what is perceived by them.
Step 7: A&ternatie Ea&uation: 5ow the individual will evaluate the alternative brands.
"he methods used for evaluating the various products will be dependent on the
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consumers underlying goals& motives and personality. "he consumer also has certain
(predetermined* beliefs about the various brands in terms of the characteristics associated
with the different brands. Based on these beliefs the consumer will respond either
positively or negatively towards a particular brand.
Step 8: Choi*e: "he consumer$s choice will depend on his or her intention and attitude.
"he choice will also depend upon normative compliance (i.e.& getting influenced by other
people like family members& friends etc.&* or by anticipated circumstances (i.e.& the
person$s choice of the product can also be dependent on the sensitivity of the individual
to handle unanticipated circumstances like losing the >ob& funds diverted for another
urgent cause etc.*
Step 9: Out*ome: "he outcome may be either positive or negative. 'f the end result is
positive& the outcome will also be positive. Conversely& if there is dissonance& that is& a
feeling of doubt e7perienced by the consumer& about the choice made by him or her the
outcome will not be positive. 5ow the consumer will search for more information to
support his or her choice.
"he above menti>oned model has taken into considedration a large number of
variables which influences the consumer. "he model has also emphasi3ed on the
conscious decision making process adopted by a consumer. "he model is easy to
understand and is fle7ible& that is& it recogni3es that a consumer may not go through all
the steps always. "his is because in case of repeat purchases the consumer may bypass
some of the steps.
6ne limitation of this model is the inclusion of environmental variables and
general motivating influences but not specifying the effect of these on the buyer
behaviour.
Enge&: B&a*$-e&& an% Miniar% .EBM/ Mo%e&
"his model is a development of the original =ngel& -ollat and Blackwell model
first introduced in /9:I. 't shares certain things with the Howard!%heth model. Both
have similar scope and have the same level of comple7ity. <rimarily the core of the
=B4 model is a decision process& which is augmented with inputs from information
processing and other influencing factors also.
"he model have distinctive four sections& namely0 'nput& 'nformation <rocessing&
Jecision <rocess and .ariables influencing decision process.
Information Input
'nformation from marketing and non marketing sources are fed into the
information processing section of the model. "he model also suggests additional
information to be collected as a part of an e7ternal search especially when not enough
information is available from memory or when post!purchase dissonance occurs.
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Information )ro*essing
Before information can be used in the rest of the model& the consumer will first be
e7posed to be the information processing. "hat is the consumer must get e7posed to the
information& attend to it& comprehend or understand it& accept it and finally retain it in
memory. Any selective attention or e7posure mechanisms (which may occur in post
purchase dissonance* would operate at this stage.
De*ision )ro*ess: "his process consists of five basic stages0
Nee% Re*ognition: "his acknowledges the fact that there e7ists a problem. "hat is& the
individual is aware that there is a need to be satisfied.
Sear*h: When enough information is available in memory to take a decision& then only
internal search will be re2uired. 'f information is scarce& an e7ternal search for
information is undertaken.
A&ternatie ea&uation: 5ow an evaluation of the alternatives found during the search is
undertaken. We can see from the model& that this takes into account our attitudes and
beliefs also.
)ur*hase: A purchase is made based on the chosen alternative.
Out*omes: "he outcome can be either positive or negative depending on whether the
purchase satisfies the original perceived need. Jissatisfaction can lead to post!purchase
dissonance.
Variab&es Inf&uen*ing De*ision )ro*ess
"his section will consider the individual& social& and situational factors which
influence the decision processes.
"he =B4 model is very fle7ible and more coherent than the Howard %heth model
of consumer behaviour. 't also includes human processes like memory& information
processing and considers both the positive and negative purchase outcomes.
However the model has been critici3ed on two aspects. Eirstly& one the somewhat
vague definition of the role of the influencing variables and secondly& it is felt that the
separation of information search and alternative evaluation is somewhat artificial.
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