Consumer Behaviour

Prof Sameer Kulkarni

Consumer Mind: A Black
Box
Stimulus
Company Buy
Controlled
Product
Price
Consumer
Advertising Response
Mind
Promotion
(Black Box)
Display
Distribution

Social
No Buy
Word of
Mouth
Reference
Group
 Customer Decision Making
Process
Drivers of Change

Technology
Development/
New
Generations

Awarene CUSTOMER Personali

ss ty
•Assertive
Values Social •Exhibitionist
•Self Concept
•Differ Pleasure Structure •Life-Style
vs. •Individualism vs. •Aspirations
•Instant Pleasure •Collectivism
 How they Buy ?
• High involvement products:
 High price
 Complex features
 Significant differences between
alternatives
 High perceived risk
 Reflect self concept of buyer
 E.g. Selection of a Car
 How they Buy ?
• Low involvement products
 Alternatives within the same product
class are similar
 Does not reflect buyers self concept
 Frequent brand switching behaviour
• E.g. buying a bathing bar (Toilet
Soap)
Purchase decision in low
involvement products
 Theory of evoked set
(Howard & sheth’s theory)
 Its not product but the
Situation

• Routinized response
• Limited problem solving
• Extensive problem solving
 Types of Buying Behavior

High Involvement Low Involvement

Significant Complex Buying Variety Seeking
Differences Behaviour Buying
Between Brands
Few Differences Dissonance Reducing Behaviour
Habitual Buying
Between Brands Buying Behaviour
Behaviour
 Motivational reasons
• Sheth’s consumer motives
– Five dimensions of motivation
concerning products/services benefits
• Functional – utility or function performed
• Aesthetic/emotional – appearance or
attractiveness
• Social – status or esteem value
• Situational – unexpected benefit
• Curiosity – interest aroused
Purchase decision in high
involvement products
 Routinized response
(straight re buy)

• Customer is aware of his /her choice

• Decision is based on personal
experience
• Spends little /no time in choosing an
alternative
• Perceives low risks
 Limited problem solving
(modified re buy)

• Launch of a new product which leads

in a change in the customer’s
decision criteria.
• Buying leads to trial purchase
• Brand extension helps in removing
obstacles
• Perceives moderate risk
 Extensive problem solving
(new task)

• Requires extensive learning

• Awareness about alternatives is zero
• Has no decision criteria
• Unable to evaluate different brands
• Relocating to a new & unknown
environment
Rational behind behaviour
 Psychological Factors

Motivation

Learning

Perception
 Motivation
(Sigmund Freud)
Influence on Buyer
Behaviour
 Values motivates in buying
• Functional value
• Conditional value
• Social value
• Emotional value
• Knowledge value
• (according to Sheth , Newman &
Gross)
 Learning Theory
• Human behaviour is learnt
One learns @ the pain of punishment
Or @ the lure of rewards
• Directing human behaviour is done by
developing stimuli and cues which bring to
fore the latent need
• Attractive advertisement , shelf display,
packaging, how to use instructions ,store
layout ,availability &
sales persons are examples of cues
 Basis of Differences
• Gender differences –
hunter=men,
nurse=women

• Intelligence differences –
caste,
class,
education, etc.

• Personality differences –
job specializations
• Plato stated more than 2000 years
ago:

“No two persons are born exactly

alike; but each differs from the other
in natural endowments, one being
suited for one occupation and the
other for another.”
Cognitive dissonance theory
• Leon Festinger-1957 ,wrote the
theory of cognitive dissonance
• Psychological discomfort caused by
inconsistency among a person’s
beliefs , attitudes / actions e.g.
smoking
• Varies in intensity based on
importance of issue & degree of
inconsistency
 Lifestyles
(Indian Perspective)
 Buyer lifestyle
• Survivors: Price conscious , not very
knowledgeable , depressed.
• Sustainers: Strugglers , swayed by brand
guarantee , impulse buyers.
• Belongers: Conventional conservative ,
nostalgic , unexperimental.
• Emulators : Ambitious , upwardly mobile ,
status conscious , buy to impress others.
• Achievers : Leaders , work in hi tech top line
products.
• I-am-me: Young , Self engrossed , impulsive.
• Experimental : Pursue a rich inner life , High
sense of social resp.