Market Analysis
Lecture: 2-3
Introduction to
Consumer Behavior
Session Objectives
By the end of this class, we will be able to:
Understand consumer behavior and why is it
important
Interpret how decision-making process,
psychological factors, group factors and
marketing mix come together
Understand consumer involvement
Analyze the impact of digital/internet on
consumer behavior
Who is a Consumer ?
Any individual who purchases goods and
services from the market for his/her end-
use is called a consumer
In simpler words a consumer is one who
consumes goods and services available in
the market
Now every consumers is a
Human who would have
certain Interest
Human Behavior
It is the way humans act and interact
Anything that a human does
Brushing, Bathing, Travelling, Studying - everything
that we do is part of behavior
Every human shows inclination towards particular
products and services
This interest is nothing but willingness to purchase
products and services as per their taste, need and of
course pocket
Human Behavior is influenced by :
• Internal factors like genetic, values, attitude
• External factors like society, culture, community
Consumer Behavior
A Marketer tries to understand
the behavior of his consumers
viz. target audience with
respect his product or category
https://www.youtube.com/
watch?v=gtfPU6nTa9k
Reflections from the video
o What is consumer behavior?
o What did you learn through this video?
o What are the factors that influence consumer
behavior?
o Share few examples of consumer behavior
Break Out
Share your experience as a consumer
behavior, how do you get inclined to a
specific product
!
Consumer Behavior
Understand the various stages of behavior a consumer goes through before purchasing products or
services
Need
01
Gifting Purpose 03
Why do you think
why an individual
buys a product?
02
Social Status
Consumer Behavior
Understand the various stages of behavior a consumer goes through before purchasing products or
services
Income/Budget/
Financial constraints
No requirement Taste
Why do you think a why
individual buys a product?
Consumer Behavior
Understand the various stages of behavior a consumer goes through before purchasing products or
services
Festive season Birthday
When do you think
consumers purchase
products?
Marriage or other
Anniversary
special occasions
Break Out
According to you, how human behavior
has changed due to Covid?
?
What changes do you see around you due to Covid?
Preference towards
Online hygienic(packaged) OTT(Over the top) Online
Shopping products entertainment gaming
Cut down on Concern towards Virtual Education
discretionary health and platforms
consumption environment(Organic)
(Basic needs)
Consumer Behavior
Consumer Behavior refers to the behavior of
end consumer
It tries to understand how consumers…
Search
Select
Use
Review
Dispose
…products /services to satisfy their needs
Consumer Behavior
The questions that consumer behavior answers:
o What consumers buy?
o Why they buy it?
o When Where and How they buy it?
o How they consume and dispose it?
o How satisfied / dissatisfied they become
after using it?
Break Out
Why consumer behavior is important?
?
Why Consumer Behavior?
Role of marketing is to :
• Create offerings that meet consumer needs
(What)
• Make it available at the time and place where
consumer wants it (When & Where)
• Help the consumer choose your offering over
others (How to influence)
• Keep the consumer loyal (Satisfaction /
Delight)
Consumer behaviour answers all the above
questions
Consumer Behavior & Marketing Mix
Consumer Behavior Marketing Mix
• What does the consumer need? • PRODUCT
• Where & When does the consumer • PLACE
need?
• PRICE & PROMOTION
• How to create influence /
preference?
Consumer Involvement
Consumer Involvement is the amount of
physical and mental effort that a
consumer puts into a purchase decision
It is the level of interest and
importance that a consumer
attaches to the product/service
Consumer Involvement
Involvement Life Span Price Examples
Low Very Short Very Low FMCG
Crockery, Medical
Medium Short / Medium Low-Medium
Equipment
Real Estate,
High Long High-Very High Automobiles,
Laptop
Application of Consumer Behavior
The psychology of how consumers think, feel,
reason, and select between different alternatives
(e.g., brands, products, and retailers)
The psychology of how the consumer is influenced
by his or her environment (e.g., culture, family,
signs, media)
The behavior of consumers while shopping or
making other marketing decisions
Limitations in consumer knowledge or information
processing abilities influence decisions and
marketing outcome
Application of Consumer Behavior
How consumer motivation and decision strategies
differ between products that differ in their level of
importance or interest that they entail for the
consumer
How marketers can adapt and improve their
marketing campaigns and marketing strategies to
more effectively reach the consumer
Example
By understanding that consumers are more receptive to food advertising when they are hungry, we
learn to schedule snack advertisements late in the afternoon
Example
By understanding that new products are usually
initially adopted by a few consumers and only
spread later, and then only gradually, to the rest
of the population, we learn that (1) companies
that introduce new products must be well
financed so that they can stay afloat until their
products become a commercial success and (2)
it is important to please initial customers, since
they will in turn influence many subsequent
customers’ brand choices
Metaphor
Welcome Sir and Ma’am! Hello!
Please take a seat! Thank you!
Can I get you some
water?
Oh Yes Please! It is quite hot
Thank you so much. today.
We both are getting
married next month, and we
are here for the shopping of
wedding jewelry.
We are very busy in our
schedules, and we are Yes Ma’am,
trying to close the Sir, how can I help
Jewellery shopping today. you today?
Why not I Show them
the temple designs
that have been
launched by the
company this month.
Ma’am just give me one
minute, I have the right
jewelry for you.
Displays heavy temple
designs, heavy gold
jewelry and best of the
art deigns from the
south.
About 1 hour later, the customers got up and said
“We need some time to think”.
What do you think had happened?
What could Nilesh have
done differently?
Looking at today’s world,
internet is everywhere
Let's see the impact of internet
on Consumers Behavior
Impact of Digital/Internet on Consumer Behavior
1. Ability to research and gather information
• Search, Online Aggregators, Social Media
• Allows access to brands - specifications,
features & comparison with others
• Information is widely available and transparent
2. Word-of-Mouth and Review
• WoM is passing feedback and experience orally
or through digital media
• Consumers are always looking for what others
have to say about a brand
• Reviews from bloggers, comments on
sponsored posts, customer reviews on brand
pages
Impact of Digital/Internet on Consumer Behavior
3. Inconsistent consumer loyalty
• Before digital/online, consumers preferred a
brand of their choice, stickiness was high
• They were not exposed to large range of
products / services
• With internet exposure to wider range, more
information, promotions has led to lower loyalty
and frequent shift
4. Boost in consumer engagement
• Brand digital assets like blogs, pages, handles
• Consumers share their opinions, brand stories
and engage actively
Impact of Digital/Internet on Consumer Behavior
5. Impulse Buying Behavior
• Impulse buying is spontaneous buying at the
spur of the moment
• Brands use online advertisement to highlight
attractive deals, discount offers for limited
period to increase instant purchases
6. Less patience, High expectations
• Online reviews give immediate and real
feedback
• Consumers expect brands to respond to queries
& complaints ASAP
• Express dismay and disappointment online
which impacts online reputation
Tactical Intervention
Advertisement analysis along with case
study and rebranding related activity like
we will ask them how will they rebrand a
specific loss-making brand
