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Consumer Buying Behaviour

Some Basic Concepts

Process of dividing a market into subsets of consumers with common needs or characteristics

Selection of one or more of segment identified for the company to pursue

Development of a distinct image for the product or service in the mind of consumer, an image that will differentiate the offerings from competing ones

Marketing Mix

Product Price Place Promotion

Additional 3 Ps of Service Marketing?


Process Physical evidence

Customer Value
Ratio between customers perceived benefits(economic, functional & psychological)& the resources(Money, time, efforts) used to obtain those benefits

Customer Satisfaction
Individuals perception of the performance of the product or service in relation to his or her expectation

Customer Delight
When the customer experience much more than the perception & expectation.

Consumer Behaviour

How we buy (a rational view)

functional emotional ? current vs desired situation relative importance need inhibitors
Need recognition, problem-awareness Information search Evaluate alternatives are they aware of need ? can we mediate need inhibitors? can we stimulate awareness & action

internal search (memory) external search (personal sources, commercial sources third party reports (e.g. Which) personal observation/testing


Shape desire, want

Information search Evaluate alternatives Buy Post-purchase evaluation

Buy Post-purchase evaluation

Customers vs Consumer
Customer is specific in terms of brand, company, or shop. A person who customarily or regularly purchases particular brand. Consumer a person engaged in - search, select, use and dispose of products, services, experience, or ideas.

Customers vs Consumer
Customer refers to the purchaser of a product or service. They may or may not be the ultimate consumer. Whereas
Consumer refers to the end user of a product or service. They may or may not be the customer.

Customer vs. Consumer Behaviour

Customer behaviour: a broad term that covers both individual consumers who buy goods and services for their own use and organizational buyers who purchase business products Consumer behaviour: the process through which the ultimate buyer makes purchase decisions

Consumer Behaviour
Study of how people buy, what they buy, when they buy and why they buy. Attempts to understand the buyer decision making process, both individually and in groups. Studies characteristics of individual consumers such as demographics, psychographics, and behavioural variables

Consume Behaviour is defined as the behaviour that consumers display in Searching for - purchasing - using - evaluating - disposing of product & services that they expect will satisfy their needs.

Consumer Behaviour

Consumer behavior is the study of individuals, groups, or organizations and the processes they use to select, use, and dispose of products, services, experiences, or ideas to satisfy needs and the impacts that these processes have on the consumer and society. Sheth, Mittal, and Newman (1999) define customer behavior as the mental and physical activities undertaken by household and business customers that result in decisions and actions to pay for, purchase, and use products and services.

Five Premises of Consumer Behaviour

Consume behavior is purposeful and goal oriented The consumer has free choice Consumer behavior is a process Consumer behavior can be influenced There is a need for consumer education

Model of Consumer Behaviour

Product Price Place Promotion
Marketing and Other Stimuli

Economic Technological Political Cultural

Buyers Decision Process

Buyers Black Box

Characteristics Affecting Consumer Behavior

Product Choice Brand Choice

Buyers Response

Purchase Timing Purchase Amount

Dealer Choice

Why do we need to study Consumer Behaviour?

Because no longer we can take the customer/consumer for granted.

Failure rates of new products introduced

Out of 11000 new products introduced by 77 companies, only 56% are present 5 years later. Only 8% of new product concepts offered by 112 leading companies reached the market. Out of that 83% failed to meet marketing objectives.

Buyer Behaviour


Marketing Environment

Buyer Characteristics

Buyer Decision Process

Buyer Decision

CB Activities

Mental activities include such things as: assessing the suitability of a product or service brand making inferences about a product or services qualities from advertising information evaluating actual experiences with the product Physical activities include such things as: visiting stores reading Consumer Reports talking to salespeople issuing a purchase order

Applications of CB

Strategy Regulatory Policy Social Marketing Informed Individuals

Diversity of Consumer Behaviour