Consumer Buying Behaviour

Definitions of CONSUMER
BEHAVIOR
 The study of consumer behavior
focuses on how individuals make their
decisions to spend their available
resources (time, money ,effort) on
consumption related items
 Consumer Behavior is the study of
human responses to products/services
and the marketing of
products/services
Significance of CONSUMER
BEHAVIOR
 The primary purpose of studying consumer
behavior is why and how consumers make
their purchase decisions
 To understand marketing and
environmental stimuli
 To know the factors influencing consumer
behavior
 To know how consumers will respond to
different product
features,prices,advertisement appeals
BEHAVIOR
 To distinguish different consumer
groups and to develop products that
satisfy the needs.
 To understand how consumers make
purchasing choices among
products/services.
 To know “why same consumer is
attracted to different products”
BEHAVIOR
 To know buying dynamics of consumer
 Understanding consumer behavior of target
market is essential part of marketing
manager
 To know growing market segments of
company for consumers
 Study of consumer behavior enable them to
become better and wiser consumers
BEHAVIOR
 Continuously upgrading the consumer
 To know what features or product design
acceptable by consumer
 To understand the buying roles of the
consumer
 To predict post purchase satisfaction or
dissatisfaction behavior
 Making the consumer individualistic
more conscious
BEHAVIOR
 Help marketers to assess the consumers
needs and wants and to make better
strategic marketing decisions
 To know cross cultural needs and
preferences and consumption habits
 Study of internal and external influences
which impel them to behave as they do
 To understand unethical practices
prevailing in the market
BEHAVIOR
 Consumer behavior is the field of
interdisciplinary dimensions
 Psychology – The study of individuals
– individual behavior – attitudes,
values, belief, perception, learning,
personality, motivation
 Sociology – the study of groups –
group behavior – social class,
reference groups, group dynamics
BEHAVIOR
 Socio Psychology – deals with
interpersonal behavior – behavior of
individuals in group context –
intergroup collaboration, group
decision – making, integration of
individual needs with group needs
 Anthropology – Influence of the
culture and society on individual.
Model of consumer buying
process
Components of consumer buying process
a) Identify buying roles
b) buying behaviour
c) buying research
Steps in buying process
a) Need/recognition
b) Informational search
c) evaluation of alternatives
d) purchase decision
e) Post purchase behaviour
process
Buying roles
 Initiator/Influencer – provides information
about the product/service
 Gatekeeper – controls the flow of
information
 Decider – decides whether to shop the
purchase or not
 Buyer – involves in actual purchase or the
product
process
 Preparer – transforms the product
into consumption
 Maintainer – provides
repair/maintenance services
 User – use or consume the product
 Disposer – decides whether to
continue or discontinue in using the
product
process
Types of buying behaviour
 Complex buying behaviour – It is a
behaviour of the consumer when the
purchase is highly inexpensive or the
products which are bought infrequently
and risky
 Dissonance reducing buying behaviour- It
is a behaviour when the consumer is
confronted with a unfamiliar brand name in
a familiar product class
process
 Habitual buying behaviour - It is a behaviour
when the consumer doesn’t find difficulty in
making a purchase due to awareness of
brands
 Novelty seeking buying behaviour - It is a
behaviour when the consumer involves in
the purchase for novel or new brands
process
Buying Research
 The methods used in conducting buying
research :
 a) Focus Group Interview
 b) In-depth Interview
 c) Projective Techniques–
Model of consumer buying process
a) Focus Group Interview - conducted by a
trained moderator in a natural manner with a
group of respondents. A focus group is a
sample of respondents from the specified
target market. Focus group interview takes
place in the form of free-flowing group
discussion among various target groups. The
moderator plays a key role to establish the
rapport with the participants to keep the
discussion moving forward and probe the
respondents to elicit insights into the
problem.
process
Applications of focus group interview
 Understanding consumer perceptions,
perceptions concerning a product category
 Obtaining impression of new product
concepts
 Generating ideas about new and existing
products
 Developing creative concepts of advertising
copy from the consumer
process
b) In depth interview – It is method of obtaining
qualitative data. An unstructured, direct, personal
interview in which a single respondent is probed by
a skilled interviewer to knowing underlying
motivations, attitudes and feelings on a topic. The
interviewer encourages the respondent to talk freely
Applications of In depth interview
 Discussion of confidential, sensitive or embarrassing
topics or situations where the strong social norms
exist
process
 Detailed understanding the complicated
behavior of the consumer and other groups
 Situations where product consumption
experience is sensory in nature ( which is
emotional in nature)
c) Projective techniques – an unstructured and
indirect form of questioning that encourages
the respondent to project their underlying
motivations, attitudes, belief etc regarding
the issue of concern.
process
 In projective techniques, the respondents are asked to
interpret the behavior of others rather than their own
behavior
 Ex of projective techniques – word association tests,
sentence completion tests, story completion tests,
picture response or TAT ( Thematic Apperception
Test), Role playing, Third person techniques etc.
 Word association test – respondents are presented
with the help of words one at a time and are asked to
respond to each with the first word that comes in mind
process
 Sentence completion test – respondents are
provided with the part of story and required to
give conclusion in their own words.
 Picture response or TAT ( Thematic Apperception
Test) – the respondents are shown a picture and
asked to tell a story describing it.
 Role playing – respondents are asked to assume
the behavior of someone else and have to role-
play their behavior.
process
 Thirdperson technique – in which
respondents are presented with
verbal or visual situation and are
asked to related the beliefs and
attitudes of a third person. The third
person may be friend, neighbour or
family etc
process
2) steps in buying process
 a) Need/recognition - It starts when the
buyer recognises a problem or need
 b) Informational search – Information about
the felt need by the consumers can be
collected through various sources –
personal sources, commercial sources,
public sources, experimental sources
process
 Evaluation of alternatives - Consumer
evaluates various alternatives before
making a purchase – quality, price etc
 Purchase decision - The factors that
influence the purchase decision are
product choice, brand choice, dealer
choice, purchase timing & purchase
amount
process
 Post purchase behaviour - After
making a purchase the consumer
experiences satisfaction or
dissatisfaction in using the product
Types of post purchase behaviour
 Post purchase satisfaction – the
defects identified by the consumer
should be replaced
process
 Post purchase action – If the
consumer is highly satisfied then
there is a high probability of repeated
purchase
 Post purchase use and disposal –If the
consumer finds a new use after using
the product, that should be
highlighted by the company through
advertising
Product Innovation
 Product Innovation refers to new -
idea, concept, method, practice,
product or service which is perceived
by someone as new
 Innovations take time to penetrate
into the members of the social
system
Product Adoption
 Adoption refers to the acceptance or
continual use of new product or brand by
the individuals
 Adoption is a step-by-step mental process
of adopting or accepting a new product
 Adoption is the process by which the
individual passes several stages to arrive
at decision in using a new product
Adoption Process
 Stages in Adoption process
 a) Awareness – consumer is exposed
to innovation, but lacks information
 b) Comprehension – consumer has
information & understanding about
the new product. It reveals the
interest towards the product
Adoption Process
 c) Attitude – refers to favourable or
unfavourable disposition of the
consumer towards the product
 d) Legitimisation – refers to – the
consumers are highly convinced
about the new product
 e) Trial – The product is tested before
acceptance
Adoption Process
 f)Adoption or rejection – If the trial is
positive, the product is accepted or
otherwise the product is rejected
Conclusion
 Adoption process is helpful in
managing product innovation and
also in designing promotional
strategy
Categories of Adopters
 Innovators – constitute 2.5% of the total
market. Innovators are first to adopt to
new product. They are highly educated,
esteem class and also cosmopolitian
 Early adopters – constitute 13.5% of total
market. They are the second to adopt new
adopt. They are also educated and high
social status. They are socially integrated
and also the leaders of the social
community
Categories of Adopters
 Early majority – constitute 34% of the total
market . They are just before the average
member of the social class.
 Late majority – constitute 34% of the total
market. They are skeptical . The people are
after the average member of the social class
 Laggards – constitute 16% of total market. They
are last to adopt new product. They are having
low social economic status. They have less
interest to try new product and spend less on
promotion
Diffusion of innovation
 Diffusion refers to the acceptance of the
innovation which is spread by the
communication(mass media, salesman,
opinion leaders) to the members of the
social system over a period of time
 Diffusion refers how new product captures
target market
 Diffusion is the aggregate of all individuals
decision to adopt new product
Factors influence the rate of
diffusion
 These factors explain “what is the
definition of new product or when it is
called the new product according to
consumers)
Factors
1) Firm oriented definition – consistent
with the view that a firm which is
capable of copy or modify the
competitors product was qualified as
new product
diffusion
2) Product oriented definition
a) continuous innovation – it refers to the
introduction of the modified product rather
than new product
b) dynamically continuous – creation of new
products rather than modified products
c) discontinuous innovation – consumers feel
difficulty to adopt the patterns of new
product
diffusion
3) Market oriented definition – A product
is considered new if it is relatively
purchased by the majority of the
potential market
4) Consumer oriented definition
a) relative advantage – the degree to
which the potential customer perceive
a new product as superior to
competitors
diffusion
b) compatibility – the degree to which
potential customer feel a new product is
consistent with the needs of the consumer
c) complexity – the degree to which the new
product is difficult to understand its usage
by the consumers
d) trialability – the degree to which the new
product is suitable to try before usage at
free of cost
diffusion
e) observability – the degree to which
the product benefits or attributes can
be described to potential consumers
by the company sources
Organizational buying
process/Industrial buying
process
 Definition : It is defined as the
decision-making process by which
formal organizations establish the
need for purchased products/services
to identify, evaluate and choose
among alternative brands and
suppliers.
 It was developed by Fredrick E
Webster & Yoram Wind
Characteristics/features of
Organizational buying process
 1) The organizational buyers are called as
producer/manufacturer business units
consists of all the individuals/organizations
who acquire goods/services that enter into
the production of other products/services
that are sold, rented or supplied to others.
 2) The various types of organizational
buying units are in the areas of services,
agriculture, forestry, fisheries, wholesalers,
retailers, construction units, farming,
governmental units etc.
 3) organizational buyers make purchase decisions in
order to satisfy their goals as similar to final consumers.
 4) Geographical Concentration – buyers are more
concentrated by size in organizational market.
 Ex: textiles are clustered predominantly in south
 5) Group Involvement – A group of individuals may be
involved in buying decision. People from engineering,
manufacturing, production, purchase, finance
departments along with top management participate in
machinery purchase decision.
Characteristics/features of Organizational
buying process
 6) Technical knowledge – They are professional
buyers and are quite knowledgable about
products/services. Their purchase is directed by
technically competent individuals.
 7) Rational Motivators – they are economical in nature
and the costs & benefits are carefully weighed.
Product quality specifications, consistency, assurance,
delivery, credit terms, warranty are other elements
influencing in the selection of vendors.
 8) Formal procedures – involves proposals, quotation
requests, purchasing contracts, price and product
specifications
 9) Complexity – It requires conscious
considerations with higher financial risks
 10) lengthy negotiations – the size of the order
is large and purchaser price is very important.
 11) Derived demand – the demand for industrial
goods will ultimately be derived from the
demand for consumer goods
 12) Inelastic demand – if the total demand for
the industrial product remains affected by price
changes then demand is inelastic
 Ex: the footwear manufacturers are not going to
buy more leather if the price of the leather
reduces.
 13) Fluctuating demand – the nature of the
demand in industrial goods is highly volatile
 14) Straight/routine rebuy – It is a buying
situation where the purchaser will reorder the
product without any modification
 Ex: electricity, water, office supplies etc
 15) Modified rebuy – It is a buying situation
where buyer/purchaser wants to modify
product specifications/prices.
 16) Reciprocal buying – a paper manufacturer
will by necessary equipment from chemical
manufacturer which inturn buys the
stationery from the paper manufacturer
 17) Leasing – organizational buyers go for
equipment leasing instead of outright
purchase
Steps in Organizational/Industrial
buying process
 1) Problem recognition
 2) Need description
 3) Vendor search
 4) Proposal request
 5) Vendor selection
 6) Purchase routine selection
 7) Post purchase evaluation
buying process
 1) Problem recognition – for ex: breakdown of the
machine which requires replacement of new parts
immediately
 2) Need description – Industrial buyer tends to
define product , quality as the combination which
fits the product to use in the future.
 3) Vendor search – In this organization tries to
identify companies who may be the appropriate
suppliers of the specified product
buying process
 Organizational buyers have a wide range of
informational sources to use in their assessment
of products & suppliers.
 4) Proposal request – the company may send a
request for proposal to qualified vendor asking
them to bid based on product specification.
 5) Vendor selection – the vendor selection is
based on the following criteria :
buying process
 Overall reputation of the supplier, financing terms,
technical service offered, convenience in placing the
order, data on the reliability of product, quality or price,
reliability of the delivery time promised, repair and
maintenance service after the date of purchase.
 6) Purchase routine selection – Involves placing an
order specifying all terms with vendor who processes it
and ships the product. It is then received, approved and
buying process
 payment is made. Companies often negotiate
a contract to cover purchase over specific
length of time
 7) Post purchase evaluation – involves
evaluation of supplier’s performance by the
buyer. It rates the supplier’s performance
periodically based on quality, price, delivery,
post sales service. Vendors may also receive
the report so that they may modify their
performance for better customer service.
Cognitive Dissonance Theory
 Cognitive dissonance is a tension between
two opposite thoughts after consumer has
bought something. The consumer is
uncertain of the purchase decision he has
made ( whether it is right choice or not)
 This theory was developed by the former
Stanford University Psychologist – Leon
Festinger in 1957
 Cognition – A thought about an object
 Cognitive dissonance refers to the
tendency of consumers to worry about
the wisdom of major purchases after they
have been made.
 Ex: A product positioned as a luxury
product with an elegant design,
expensive packaging, limited distribution,
and ads that stress exclusiveness should
not be priced at or below an average
product create dissonance in the minds
of consumers
 This theory suggests that we have an
inner drive to hold all our attitudes
and beliefs in harmony to avoid
disharmony(dissonance – discomfort)
 This theory refers to the situation
involving conflicting attitudes, beliefs
or behaviors. Due to this it creates a
discomfort which is called dissonance.
 When cognitive dissonance occurs
after a purchase, it is called post
purchase dissonance.
 Forinstance : when consumers have
made a commitment - made a down
payment or placed an order for a
expensive product (laptop), they often
begin to feel cognitive dissonance
when the unique qualities of the
brand not selected i.e., left behind
 The principle of this theory is to
reduce post purchase dissonance in
consumer purchase decision
 Itis one of the theory of Attitude. The
basic concept of this theory was
derived from the learning hierarchy
of attitudes. The hierarchy of
attitudes are :
 Cognition - Affective -> Conative
 (thoughts ->feelings ->actions) i.e,
you think first, feel next & act last.
 Attitudes are learned based on some
experience or information about
object which creates predisposition
and cause consistent response.
 When the individual is consistent with the
target behavior and the target attitude then it
results in consonance. When there is
inconsistency between the target behavior and
the target attitude then it results dissonance
( which is the theme of cognitive dissonance).
 Ex: I like driving car , but if the driving results
in accidents or frequent repairs then it creates
discomfort or dissonance
 In this ex: driving car is (target behavior -
A) – and as a result of accident and repair
which results negative attitude towards
the product ( target attitude - B).
 This theory states that cognitions are
consonant, dissonant and irrelevant.
Cognitions are consistent or consonant if A
implies B ( A – Behavior , B – Attitude).
Cognitions are consonant when one follows
from the another on the basis of logic or
experience.
 Cognitions can be inconsistent or dissonant if A
is opposite of B. Cognitions are dissonant when
they are opposed to one’s experience and the
relationship of events.
 Ex: when an individual buys an expensive car
but is not suitable of long drives then it is said to
be dissonant
 Cognitions can be unrelated or irrelevant if A is
not related to B. cognitions are totally irrelevant
when two events are not interrelated.
 The extent to which dissonance depends on
the significance of the purchase decision,
attractiveness of the rejected alternative,
the number of the negative views in the
choice made, number of options considered
, whether the choice is made (forced or
voluntary).
 Dissonance can be reduced by :
 i)changing his/her attitudes
 ii) beliefs based on the situation, actively
seeking the positive information about
chosen alternative
 iii)selective exposure – It is the tendency
to avoid information inconsistent with
one’s attitudes/beliefs
 Conclusion
 Cognitive dissonance helps to reduce
post purchase dissonance in consumer
purchase decision.
 It applies to all situations involving
attitude formation and change.
 It results in problem-solving and
decision-making
 Motivation is a drive that impels the
individual to his goal. For ex: as hunger
man impels to eat , so does dissonance
impels a person to change individual
outcomes or behavior.
 The marketers need to design consistent
marketing mix that matches consumers
attitudes, beliefs etc to reduce dissonance
Opinion Leadership
 Opinion Leaders are the individuals who
actively seek information and advice
about products/services.
 Opinion leaders are also called as
influentials.
 Ex: Any satisfied customer is a opinion
leader.
 Opinion leaders have strong informal
relationships with the end-users.
Opinion Leadership
 Features/characteristics of opinion leaders
 They are socially more active than end users
 Opinion leaders are primarily community social
leaders whom the mass market is associated
because of snob appeal.
 Opinion leaders are found in all the areas of
society and a specific person can become a
opinion leader to a certain product areas and
they act as opinion followers to some other
areas.
Opinion Leadership
 The presence of the opinion leaders is effective
where the group influence is strong for the
products that are visible to whom the buyer
respects.
 Opinion leaders creates diffused network.
 Opinion leaders are prompted by mass media to
spread the information while the general public
seeks information from them.
 If the influence of mass media on public is not
direct, powerful or automatic then it is mediated
through opinion leaders
Opinion Leadership
 People who primarily interact within social
class and acquire their lifestyle and other
ideas from people like themselves are called
as opinion leaders.
 Opinion leaders are the sources of both
information and advice. It is a two way
process. The consumers can seek the following
information :
 Ex: which of the brands are the best, where to
shop, who provides the best service, how to
make use of the specific product etc
Opinion Leadership
 Opinion leaders satisfy variety of needs by
engaging a product-related conversation
with the consumer.
 They obtain new product or new usage
information
 They reduce the perceived risk by receiving
the primary knowledge from a user about a
specific product or brand.
 They reduce the search time entailed in the
identification of a needed product/service
Opinion Leadership
 Self – involvement motivators – reduce post
purchase uncertainty. Gain attention or status.
Assert superiority and expertise.
 Product-involvement motivators – express
satisfaction or dissatisfaction with a product/service
 Social involvement motivators – express
neighbourhoodness and friendship by discussing
about product/service that may be useful to others.
Opinion Leadership
 Message – involvement – express
one’s reaction to a stimulating
advertisement by telling others about
it
 Innovativeness, willingness to talk,
self-confidence, adaptability,
gregariousness, diffusion etc are
some of the qualities of the opinion
leaders.
Opinion Leadership
 Measurement techniques for
determining opinion leadership
 Self designating method – Each
respondent is asked a series of
questions to determine the degree to
which he/she perceives as an opinion
leader. This method measures the
individual’s self perception
 Ex: do you influence other people in
the selection of the products
Opinion Leadership
 Sociometric method – the members of
the social system are asked to identify
whom they give advice and to whom
they go for advice and information
about a product category. This method
measures the pattern of the individuals
living in the society.
 Ex: whom do you ask, who asks you for
information about product category.
Opinion Leadership
 Key informant method – carefully selected
key information in a social system are asked
to designate as opinion leaders
 Ex: who are the most influential people in the
group
 Objective Method – it artificially places
individuals in a position to act as opinion
leaders and measures the results of their
efforts. It measures the individuals ability to
influence others.
Opinion Leadership
 Conclusion
 Opinion Leaders are the individuals who
actively seek information and advice about
products/services. Opinion leaders may be
the friends, neighbours, family members ,
leaders of the social community.
 Opinion leadership is effective due to the
effective word-of-mouth communication
Opinion Leadership
 Measurement techniques for
determining opinion leadership
 Self designating method
 Sociometric method
 Key informant method
 Objective Method
Consumerism
 Consumerism is a social force which
makes the business community more
honest, efficient, responsive and
responsible.
 Consumerism makes manufacturers &
sellers compelled to adopt fair trade
practices.
 Consumerism can be viewed as an
opportunity for businessmen to serve the
consumers in a better and more effecient
way.
Consumerism
 Features/ Characteristics
 It proves to be a weapon for marketers
to effectively implement the societal
concept of marketing.
 It helps the consumers to get rid of
traders who resort to practices from
hoarders, black marketers etc.
 It ensures that government takes
necessary measures to protect the
consumer interests by guaranteeing their
legitimate rights.
Consumerism
 It makes the marketers to provide the true
It makes the marketers to provide the true
information in their advertisements, truth about
labeling & product performance.
 Consumerism is the collective action of the
consumers to protect their own interest.
 It has three determinants – business, government
and consumers itself.
 Through consumerism, it is the moral
responsibility of the manufacturer to provide the
necessary instructions manual to the consumers
along with the product
Consumerism
 To ensure that the products are safe,
products are tested before getting it
affixed with the necessary quality
standards approval.
 Consumer education – information and
knowledge about company, product etc.
 Consumerism is any organised movement
of citizens and government to enhance
the rights and power of buyer in relation
to sellers.
Consumerism
 Factors influencing consumerism
 Poverty & backwardness of the country
 Explosive population growth
 Unemployment
 Illiteracy
 Inability to understand the technical complexity
of the product.
 Disparities in the distribution of income &
wealth.
Consumerism
 The Consumer Protection Act , 1986
 It is an important legislation passed by
the government of India to ensure a
proper system in the protection of
consumer rights and the redressal of
consumer disputes.
 The objectives of this act are
 To provide for the better protection of
the interests of the consumers
 To make establishment of consumer
councils and authorities for the
Consumerism
 According to section 2(d) of this act, he
who purchases goods for consideration
and who hires any services for
consideration is a consumer.
 To protect the legitimate rights of the
consumer.
 It includes all the services – banking,
finance, insurance, transportation etc
 This act also ensures right to give
protection against marketing of goods
which are hazardous, dangerous to life &
property
Consumerism
 Right to give correct information on the quality,
quantity, purity and standards of the
products/services delivered by the company.
 To protect the consumer from unfair trade
practices from the marketers.
 The right to be able to make a choice from a
variety of products at competitive prices.
 The right to seek redressal against unfair trade
practices and exploitation.
 The right to consumer education
Consumerism
 Statutory Regulators of Consumer
Protection Act, 1986
 The Monopolies & Restrictive Trade
Practices Act ( MRTP Act, 1969)
 Drugs Control Act, 1950
 Sale of Goods Act, 1935
 Essential Commodities Act, 1955
 Standard Weights & Measures Act, 1956
 Agricultural Products Grading & Marketing
Act, 1937
Consumerism
 Topics covered
 Features of Consumerism
 Factors influencing Consumerism
 The Consumer Protection Act, 1986
 Statutory Regulators Consumer
Protection Act

Consumer Buying Behaviour

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Definitions of CONSUMER

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