Consumer Behaviour-Study Notes

Define Consumer Behavior?

Consumer Behavior may be defined as the interplay of forces that takes place during a consumption process, within a consumers self and his environment.

• this interaction takes place between three elements viz. cogntion, affect and behavior;

• it continues through pre-purchase activity to the post purchase experience;

• it includes the stages of evaluating, acquiring, using and disposing of goods and services”.

List out the individual determinants and environmental influences that affect consumption behavior?

These are listed as follows:

• Individual Determinants:

  • Personal motivation and involvement
  • Perception
  • Attitudes
  • Learning and memory
  • Self-concept and personality
  • Decision making.

• External Environment:

  • Family
  • Social Group
  • Reference Groups
  • Social Class
  • Culture
  • Sub-culture
  • Cross-culture
  • National and regional influences

Scope of Consumer Behavior:

The study of consumer behavior deals with understanding consumption patterns and behavior. It includes within its ambit the answers to the following:

• ‘What’ the consumers buy: goods and services

• ‘Why’ they buy it: need and want

• ‘When’ do they buy it: time: day, week, month, year, occasions etc.

• ‘Where’ they buy it: place

• ‘How often they buy’ it: time interval

• ‘How often they use’ it: frequency of use

The scope of consumer behavior includes not only the actual buyer but also the various roles played by him/ different individuals.

Buying Roles

A child goes to a kindergarten school. She comes back home and asks her parents to buy her a set of color pencils and crayons. Now the roles played are: 1. Initiator: the child in nursery school

1. Influencer: a fellow classmate

2. Decider: the father or the mother

3. Buyer: the father or the mother

4. User: the child

Market research may be defined as:

• an organized effort to gather information about the market and the customers.

• systematic collection, analysis and interpretation of data related to the market and the surrounding environment.

The environment surrounding a Company may be grouped as the “micro-environment” and the “macro environment”. The micro-environment comprises forces in the environment that are close to the company and affect the company directly; for example, the company’s internal environment, the founder/leader and his vision and mission, the customers, competitors, suppliers, and channel intermediaries. The macro- environment on the other hand,comprises forces in the environment that first affect the micro environment and through that they affect the company; in other words they affect the company indirectly; examples are the demographic factors, socio-economic factors, political factors, technological factors, cultural factors, natural factors etc. The forces in the macro environment affect all the companies operating in a same industry in a similar manner.

The micro-environment is studied in terms of strengths (S) and weaknesses (W), while the macro-environment is studied in terms of opportunities (O) and threats(T). The analysis of both of these put together comprises the SWOT analysis.

(Resource: Great Notes for Studying: http://www.nptel.ac.in/courses/110105029/)