Consumer Behavior

By
Prof.Kameswara Rao
 CHAPTER 1

Consumer Behavior and

Consumer Research
What Is Consumer Behavior?

Activities people undertake when

obtaining, consuming, and
disposing of products and
services
 Consumer Organizational
Influences Influences

Obtaining Consuming Disposing

Consumer Behavior
Consumer Organizational
Influences Influences
 Consumer Organizational
Influences Influences
Culture Brand
Ethnicity Product Features
Personality Advertising
Family Word of Mouth
Life-stage Promotions
Values Retail Displays
Income Price
Available Resources Quality
Attitudes Service
Opinions Store Ambiance
Feelings Convenience
Motivations Loyalty Programs
Past Experiences Packaging
Peer Groups Product Availability
Knowledge
 Consumer Organizational
Influences Influences

Obtaining Consuming Disposing

Consumer Behavior
Obtaining Consuming Disposing
 Obtaining Consuming Disposing

How you decide How you use the How you get rid of
you want to buy product remaining product

Other products How you store the How much you

you consider product in your throw away after
buying home use

Where you buy Who uses the If you resell items
product yourself or
How you pay for through a
product How much you consignment
consume store
How you
transport How product How you recycle
product home compares with some products
expectations
 CONSUMER INFLUENCES ORGANIZATIONAL
Culture Ethnicity INFLUENCES
Personality Family Brand Product Features
Life-stage Values Advertising Word of Mouth
Income Available Promotions Retail Displays
Resources Price Quality
Attitudes Opinions Service Store Ambiance
Motivations Past Convenience Loyalty
Experiences Programs
Feelings Peer Groups Packaging Product
Knowledge Availability

OBTAINING CONSUMING DISPOSING

How you decide you How you use the How you get rid of
want product remaining product
to buy How you store the How much you
Other products you product throw
consider buying in your home away after use
Where you buy Who uses the If you resell items
How you pay for product yourself
product How much you or through a
How you transport consume consignment
product home How product store
compares with How you recycle
Consumer Behavior
expectations some
products
What Is Consumer Behavior?

Activities people undertake when

obtaining, consuming, and
disposing of products and
services
A field of study that focuses on
consumer activities
What Is Consumer Behavior?

Activities people undertake when

obtaining, consuming, and
disposing of products and
services
A field of study that focuses on
consumer activities
Scope goes beyond just why and
how people buy to include
consumption analysis
Consumption Analysis
Why and how people use products
in addition to why and how they
buy
The Marketing Concept
The process of planning and
executing the conception, pricing,
promotion, and distribution of
ideas, goods, and services to create
exchanges that satisfy individual
and organizational objectives
The Marketing Concept
The process of planning and
executing the conception, pricing,
promotion, and distribution of
ideas, goods, and services to create
exchanges that satisfy individual
and organizational objectives
Satisfaction with an exchange
depends on satisfaction with
consumption of product and the
exchange of money
Why Study Consumer Behavior?
Why Study Consumer Behavior?
Consumer Behavior Determines the
Economic Health of a Nation
Why Study Consumer Behavior?
Consumer Behavior Determines the
Economic Health of a Nation
Consumer Behavior Determines the
Success of Marketing Programs
Why Study Consumer Behavior?
Consumer Behavior Determines the
Success of Marketing Programs
Marketing can be used to
influence brand choice and
purchase, while Demarketing
can influence people to stop
harmful consumption

“The Customer is King”

Organization influenced by
consumer needs and wants
Why Study Consumer Behavior?
Consumer Behavior Determines the
Success of Marketing Programs
Organizations that are Customer-
centric use a total marketing approach
to focus their resources on satisfying
customers

Marketing
Process of transforming or changing
an organization to have what people
will buy
Why Study Consumer Behavior?
Consumer Behavior Determines the
Economic Health of a Nation
Consumer Behavior Determines the
Success of Marketing Programs
Consumer Behavior Determines the
Economic Health of Everyone
Why Study Consumer Behavior?
Consumer Behavior Determines the
Economic Health of Everyone
The individual’s decisions as a
consumer determine their economic
health by making more effective
consumption decisions while avoiding
deceptive practices harmful to them
Why Study Consumer Behavior?
Consumer Behavior Determines the
Economic Health of Everyone
Public policy leaders and social
commentators study consumer
behavior to alleviate overconsumption
and underconsumption by educating
consumers about problems and
providing assistance
Educating
Consumers
About
Crises
Educating Consumers About Health
Understanding consumers’ issues or
problems and developing methods to
reach and educate consumers
Educating Consumers About Health
Understanding consumers’ issues or
problems and developing methods to
reach and educate consumers
Why Study Consumer Behavior?
Consumer Behavior Determines the
Economic Health of a Nation
Consumer Behavior Determines the
Success of Marketing Programs
Consumer Behavior Determines the
Economic Health of Everyone
Consumer Behavior Helps
Formulate Public Policy
Helps Formulate Public Policy
Government Protection
and Education
Understanding Int
e
consumers’ rat rest
es
needs to o n omi cs
Soci Ec
formulate al
Welf
are ily
public policy Fam ing
n
Plan
and predicting Warni
ng
behavioral labels nm ent
r
Gove tions
changes that e gu la
R
follow
Protection from
Competitive Markets
Why Study Consumer Behavior?
Consumer Behavior Affects
Personal Policy
Why Study Consumer Behavior?
Consumer Behavior Affects
Personal Policy
Personal policy includes how you
behave towards others and in buying
situations, your values and beliefs,
and how you live your life

A person’s economic quality of life is

determined by personal policy
Evolution of Consumer Behavior
Evolution of Consumer Behavior

Supply Chain:
all the organizations involved in taking a
product from inception to final
consumption
- Manufacturers
- Wholesalers
- Retailers
- Facilitating Organizations
Evolution of Consumer Behavior

Supply Chain:
all the organizations involved in taking a
product from inception to final
consumption
- Manufacturers
- Wholesalers
- Retailers
- Facilitating Organizations

Consumers’ Increased Influence on

Business
 Evolution of Consumer Behavior

Wholesaler Manufacturer Retailer Consumer

Manufacturing Selling Marketing Consumer

Orientation Orientation Orientation Orientation

U.S. 1750-1850 1850-WWII 1970-2000 2000+

Europe 1750-1850 1760-WWII 1970-2000 2000+

 Evolution of Consumer Behavior

Consumers’ Increasing Influence

Wholesaler Manufacturer Retailer Consumer

Manufacturing Selling Marketing Consumer

Orientation Orientation Orientation Orientation

U.S. 1750-1850 1850-WWII 1970-2000 2000+

Europe 1750-1850 1760-WWII 1970-2000 2000+

Evolution of Consumer Behavior

Manufacturing Orientation
Evolution of Consumer Behavior

Manufacturing Orientation
Selling Orientation
Evolution of Consumer Behavior

Manufacturing Orientation
Selling Orientation
Marketing Orientation
Evolution of Consumer Behavior

Manufacturing Orientation
Selling Orientation
Marketing Orientation
- Motivation research
- Positivism
- Postmodernism
Evolution of Consumer Behavior

Manufacturing Orientation
Selling Orientation
Marketing Orientation
Consumer Orientation
Consumer Orientation
Beyond a marketing focus

How all organizations in a demand chain

adapt to changing consumer lifestyles
and behaviors bringing product design,
logistics, manufacturing, and retailing
together

Role of consumers in shaping many

aspects of life—society, government,
social programs, health cares, and other
areas
Consumer Research:
Methods of Studying Consumer
Behavior
Consumer Research Methods
Observation
Consumer Research Methods
Observation
Observing consumer behaviors in
different situations such as natural or
artificial settings
Consumer Research Methods
Observation
In-home observation: examining how and
when consumers use and consume products in
their households
Shadowing: following and observing
consumers in the shopping and consumption
processes. Researchers may ask questions
about reasons for behaviors
Physiological methods: Techniques
borrowed from medicine, psychology and other
sciences including cameras to measure eye
movement, galvanic skin response, and MRI
Consumer Research Methods
Interviews and Surveys
Consumer Research Methods
Interviews and Surveys
Surveys: efficient method for gathering
information from a large sample of consumers
by asking questions and recording responses
(telephone and Internet surveys, mall
intercepts, and mail questionnaires)
Consumer Research Methods
Interviews and Surveys
Surveys: efficient method for gathering
information from a large sample of consumers
by asking questions and recording responses
(telephone and Internet surveys, mall
intercepts, and mail questionnaires)
Focus Groups: a group discussion led by a
moderator skilled in persuading consumers to
thoroughly discuss a topic of interest
Consumer Research Methods
Interviews and Surveys
Surveys: efficient method for gathering
information from a large sample of consumers
by asking questions and recording responses
(telephone and Internet surveys, mall
intercepts, and mail questionnaires)
Focus Groups: a group discussion led by a
moderator skilled in persuading consumers to
thoroughly discuss a topic of interest
Longitudinal Studies: repeated measures of
activities over time to determine changes in
opinions, buying, and consumption behaviors
Consumer Research Methods
Experimentation
Measuring cause-and-effect relation-ships
by manipulating independent variables to
determine the effects of changes on
dependent variables
- Laboratory experiment
- Field experiment
Consumer Research Methods
Experimentation
 Consumer Research Methods
Experimentation
Attempts to understand cause-and-effect
relationships by carefully manipulating
independent variables to determine how
these changes affect dependent variables
- Laboratory experiment
- Field experiment
Independent variables might include number
of advertisements and package design
Dependent variables might include purchase
intent or behavior
Consumer Research Methods
Consumption Research
Consumer Research Methods
Consumption Research
Builds on the three primary research
methods to examine how people use
products and services rather than how
they buy them
Understanding How Consumers
Use Products
Consumer Research Methods
Consumption Research
Builds on the three primary research
methods to examine how people use
products and services rather than how
they buy them
May use ethnographic tools to under-
stand how values and culture influence
usage of products and other behaviors
Consumer Research Methods
Consumption Research
Builds on the three primary research
methods to examine how people use
products and services rather than how
they buy them
May use ethnographic tools to under-
stand how values and culture influence
usage of products and other behaviors
May identify new uses for existing
products or new product to satisfy
unmet or changing consumer needs
The Underlying Principles of
Consumer Behavior
The Consumer Is Sovereign
The Underlying Principles of
Consumer Behavior
The Consumer Is Sovereign
The Consumer Is Global
The Underlying Principles of
Consumer Behavior
The Consumer Is Sovereign
The Consumer Is Global
Consumers Are Different;
Consumers Are Alike
Consumers appear different but
respond in similar ways to brands
The Underlying Principles of
Consumer Behavior
The Consumer Is Sovereign
The Consumer Is Global
Consumers Are Different;
Consumers Are Alike
The Consumer Has Rights
Consumer Bill of Rights
Challenges for the Future
Gathering and interpreting
information that organizations need
to meet changing needs of
consumers
Developing effective consumer
research methods to capture
changes in trends and lifestyles
Understanding consumer behavior
from a broader perspective as an
important part of life