CONTENTS Unit Contents Page No. INTRODUCTION TO CONSUMER BEHAVIOUR 1.1 INTRODUCTION TO CONSUMER BEHAVIOUR 1.2 MEANING OF CUSTOMER AND CONSUMER. 1.3 IMPORTANCE / RELEVANCE OF STUDYING CONSUMERS* BEHAVIOUR IN THE FIELD OF MARKETING: INDIVIDUAL DETERMINANTS OF CONSUMER BEHAVIOUR 2.1 MEANING OF PERSONALITY AND SELF CONCEPT 2.2 CONSUMER PERSONALITY AND ITS NATURE AND TRAITS 2.3 MOTIVE HIERARCHY, TYPES OF BUYING MOTIVES AND THE DIMENSIONS OF CONSUMER INVOLVEMENT. 2.4 LEARNING AND MEMORY 2.5 ATTITUDE 2.6 EXTERNAL DETERMINANTS OF CONSUMER BEHAVIOUR. 7-33 CONSUMER BUYING DECISION MAKING PROCESS. 3.1 BUYING BEHVIOUR ~ MEANING 3.2. FACTORS INFLUENCING CONSUMER BUYING BEHAVIOUR, 3.3CONSUMER BUYING DECISION MAKING PROCESS. 3.4 POST PURCHASE EVALUATION AND BEHAVIOUR 3.5 TYPES OF BUYING BEHAVIOUR 3.6 DIFFERENCE BETWEEN CONSUMER BUYING AND ORGANIZATIONAL BUYING 34-40 CONSUMER BEHAVIOUR MODELS 4.1 HOWARD-SHETH MODEL 4.2 ENGEL-KOLLAT-BLACKWEEL MODEL. 4.3 NICOSIA MODEL, 41-49 “Only for Private Circulation”Unit Contents Page No. DIFFUSION OF INNOVATION 5.1 DIFFUSION OF INNOVATIONS: MEANING AND DEFINITION 5.2 DIFFUSION PROCESS. 5.3. ADOPTION PROCESS 5.4 CATEGORIES OF ADOPTERS 50-55 CONSUMER RESEARCH 6.1 CONSUMER RESEARCH PROCESS. 6.2 COLLECTION OF SECONDARY DATA 6.3 DESIGNING PRIMARY RESEARCH 56-62 “Only for Private Circulation”INTRODUCTION TO CONSUMER BEHAVIOUR LEARNING OBJECTIVES After studying this chapter, you should be able to: 1. Define Consumer Behaviour. 2, Understand the meaning of Customer and Consusnef 3. Understand the importance / relevance of Studying consumers’ behaviour in the field of Marketing: CONTENTS 1,1 INTRODUCTION TO CONSUMER BEHAVIOUR 1.2. MEANING OF CUSTOMER AND/CONSUMER. 1.3. IMPORTANCE //RELEVANCE OF STUDYING CONSUMERS’ BEHAVIOUR IN THE FIELD OF MARKETING. 1.1 INTRODUCTION TO CONSUMER BEHAVIOUR An organization iS\set up for satisfying the consumers’ unfulfilled needs and wants. In. yourprofessional capacity you may also be a part of one such business organization. But as part of the organization, have you ever wondered about who are the consumers of your products and services? Why do these consumers buy your product and not that of the competitors? How do your consumers perceive your product in terms of meeting their needs effectively? And how are these feelings reflected in their marketplace behaviour as consumers? ete. It is important for the survival and growth of the organization that one should regularly raise such questions and attempt to find answers to them. It is only through such a process of questioning and seeking answers to will help you in ensuring that the firm is on the growth trajectory. A thorough knowledge of consumers and an understanding of their behaviour (as consumers) are essential if you are to sustain yourself as an organization and grow manifolds in the current business scenario, Consumer Behavior NOTES Introduction to Consumer Behaviour “Only for Private Circulation”2 Consumer Behavior NOTES Introduction to Consumer Behaviour Consumers are unique in terms of their needs, wants, consumption patterns and consumption behaviour, In the marketplace, the marketer tries to satisfy these needs by offering suitable product or service offering. In contemporary market, considering the varied needs, wants, consumption pattetns behaviour of consumers and increased level competition ete. it has become all the more difficult for a marketer to do so effectively. Therefore, a comprehensive yet meticulous understanding of consumers and their consumption behaviour has become essential for an organization to suceeed. In other words, a comprehensive, yet sound knowledge of consumers is of vital importance in furthering the company’s business interests. The roots of consumer behaviour can be seen in the concept of “Marketing” and has essentially an interdisciplinary in nature. It has emerged as separate field of study in 1960s, How consumer behaviour is an interdisciplinary subject? a) Psychology: The study of an individual consumer behaviour). individual determinants of b) Sociology: The study of groups andits dynami¢s in buying behaviour. ©) Social psychology: The stud{*of how m individual operates or behaves in the group, 4) Beanamies: The study af income and purchasing power Defini Consumer Behaviour eat) be*definéd. as the study of individuals, groups/organizations and.the processes they use to select, secure, use and dispose of products to satisfythe needs andthe impact of these processes have on consumer and the society. It is a decision process and physical activity engaged in evaluating, acquiring, using and disposing of goods. 1.2 MEANING OF CUSTOMER AND CONSUMER. Who is a customer? ‘A customer is the one, who actually purchases the product or avail the service from a particular shop or service provider. However, a customer may not necessarily be a consumer of the product purchased or the service availed Who is a consumer? A consumer is the actual user of the product or service “Only for Private Circulation’€.g. - a child who is studying in pre-primary school has asked her father to get her a set of color pencils and crayons. In this situation, the father of the child is the customer and the girl is a consumer. 1,3 IMPORTANCE / RELEVANCE OF STUDYING CONSUMERS’ BEHAVIOUR IN THE FIELD OF MARKETING Why to study consumer behaviour? “With every new satisfaction given, customer becomes awafe’of the further satisfactions that can be obtained from a product / service and itis prudent that as an organization you realize it before the competitor / customer Theodor Levitt Asa subject or course Consumer Behavior is viewed as the building block of the marketing concept. According to the marketing concept, the marketer should be able to determine the needs and wants of the targeted market and provide suitable product and service offerings, Mors ¢ffectively and efficiently than the competitors. In other words, Marketing 18 essentially’ a customer-centric philosophy, which aims at understanding customer siteds and wants, providing them the right product/service, and thereby gen: ing Customer delight. A sound knowledge of consumers’ behavior helps thelmarketer in understanding and predicting the consumption patterns and constimption behaviors of people. It also helpg)the thatketers in understanding the internal (individual determinants) andhextemal (environmental factors) forces that makes the people to act out different consumption patterns and behaviors in the market place, In addition to this, the study of consumer behaviour is important for the following tasks performed by a marketer: a) Analyzing the environment: identifying opportunities and fighting threats By identifying needs and wants of the prospective customers. This can be done by examining trends in income consumer lifestyle and emerging influences. e.g. - the trend towards increasing number of working wives and greater emphasis on leisure and convenience have signaled the emerging needs for household gadgets such as vacuum cleaner, washing machine, food processor, dishwasher ete. Consumer Behavior NOTES Introduction to Consumer Behaviour 3 “Only for Private Circulation”Consumer Behavior NOTES Introduction to 4 Consumer Behaviour “Only for Private Circulation” b) Segmenting, targeting and positioning By thoroughly studying the consumer and his purchase behaviour in terms of how they behave and how they make their purchase decision ina given situation, This in turn leads to identification of distinct groups having more or less similar needs and wants. ‘e.g. ~a study on potential consumers for shampoo revealed that there was a class of consumers who would like to use shampoo only on special occasions and otherwise use soap to wash their hair. Further, this consumer class would not afford to spend more than Rs. 3 or 4.on shampoo. Having identified this target market companies with leading brands launched their shampoos in small sachets containing éniugh quantity for one wash and priced just at Rs. 2 or 3 ©) Designing the marketing-mix Product: - Product is a bundle of benefits that a matketer offers to customer for satisfying his needs. By:studying cofisumer behaviour a ‘marketer can make decisions about the productde¥elopment, its size, shape, packaging, flavors ete. e.g. — Maggi Bhuna masala, Sintex inddor loft water tanks Price: - This is one of the most"Wwidely used!'marketing mix tool while furthering the business.intereSts. A:ntarketer faces various questions while determining the’ ptices'of their‘products and they are as following a) What should be'the pice Of the product? b) Shouldlitbe the same as that of the competing product or lower or higher? ©) Should the price be marked on the product or left to the diseretion ofthe retailer fo charge what he can from the customer? 4) Shouldany price discounts be offered? ©), What is the customer perception of a lower or higher price? 1) Would a lower price stimulate sales? Or is a lower pric associated with poor quality? ‘The marketer has to determine the price level which helps in creating the image of the product and also in maximizing the sales revenue. To do so he must try to understand the consumer’s perception about the product, the influence of price on the purchase decisions and impact of pricing on the sales, Therefore, it is only through a continuous study of consumers’ behaviour in the marketplace that the marketer can get answers to the aforementioned issues.