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Consumer behaviour

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❶Information search describes the phase where consumers scan both their internal memory and external sources for information about products or brands that will potentially satisfy their need. Personality factors include knowledge, attitudes, personal values, beliefs , emotions and feelings.

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Novice consumers, on the other hand, are less efficient information searchers and tend to perceive higher levels of purchase risk on account of their unfamiliarity with the brand or category. When consumers have prior experience, they have less motivation to search for information, spend less effort on information search but can process new information more efficiently. Purchasing behaviour can also be affected by external influences, such as culture , sub-culture , social class , reference groups , family and situational determinants.

Culture is the broadest and most abstract of the external factors. Culture refers to the complexity of learning meanings, values, norms, and customs shared by members of a society. Cultural norms are relatively stable over time, therefore, culture has a major impact on consumer behaviour.

Research studies have consistently shown that culture influences almost every aspect of purchasing: Marketers, interested in global expansion, are especially interested in understanding cross-cultural differences in purchasing and consumption. For instance, Ferrari, one of the world's top brands found that Chinese consumers are very different from their Western counterparts.

Whereas consumers in the US, UK and Australia expect to wait 12 months for a custom-made Ferrari, prospective Chinese buyers want to drive the vehicle off the showroom floor. Buyers see their friends riding around in a luxury car and want to have the same as quickly as possible. To meet the growing demand for luxury goods, Ferrari and other luxury car makers have been forced to modify their production processes for Asian markets.

Subcultures may be based on age, geographic, religious, racial, and ethnic differences. More often, however, a subculture occurs when people with shared interests form a loose-knit group with a distinctive identity sometimes called consumer tribes.

Members of subcultures are self-selected, and signal their membership status by adopting symbols, rituals or behaviours that are widely understood by other members of the tribe e.

For example, within youth culture it is possible to identify a number of sub-groups with common interests such as skaters and bladers, surfers, ravers, punks, skin-heads, Goths, homies and others. A different type of subculture is a consumption subculture which is based on a shared commitment to a common brand or product. In other words, consumption subcultures cut across demographic, geographic and social boundaries. The most well-known example of a consumption subculture is that of Harley-Davidson motorcycle owners.

Ethnographic researchers who have studied Harley riders believe that there are only two types of motor cyclists; namely Harley owners and the rest. Subcultures are important to marketers for several reasons.

Secondly, and perhaps less obviously, many new fads and fashions emerge spontaneously from within these tribal groups. Trend-spotters are accordingly interested in studying the lifestyles and activities of tribes in an effort to spot new trends before they go mainstream. Social class refers to relatively homogenous divisions in a society, typically based on socio-economic variables such as educational attainment, income and occupation.

Social class can be very difficult to define and measure, however marketers around the world tend to use a conventional classification which divides any given population into five socio-economic quintiles e. AB socio-economic segments are of particular interest to marketers of luxury goods and services such as travel, dining-out, entertainment, luxury cars, investment or wealth management services, up-market consumer electronics and designer labels e. A reference group is defined as "a group whose presumed perspectives or values are being used by an individual as the basis for his or her judgment, opinions, and actions.

The literature identifies five broad types of reference group; primary, secondary, aspirational, dissociative and formal:. Opinion Leaders can act like reference groups in that they exert considerable social influence because of their product knowledge, expertise and credibility. In the marketing literature, opinion leaders are also known as influencers, mavens and even hubs.

Typically, opinion leaders have high levels of involvement with the product category, are heavy users of the category and tend to be early adopters of new technologies within the category. In order to leverage the value of opinion leaders in marketing strategies, it is important to be able to identify the unique opinion leaders for each category or situation and this can be very challenging.

Some techniques that can be used are through key informants, socio-metric techniques and self-questionnaires. Marketers of cosmetics and skincare preparations regularly provide fashion editors with free samples in the hope that their products will be mentioned in fashion magazines.

The family has a great impact on the individual because he learn from his young age how to act as a conscious consumer by acquiring the skills, values and trends of his family environment. As the family plays an important role in the consuming process and affects the behavior of its purchasing members, those interested in marketing should design the advertisements to suit this role. The role of the husband and wife in the purchasing decisions can be categorized into three types: The goods are purchased by a decision of the wife only.

Children play an important role in the family's purchasing processes but their role varies according to the age of the child. Older children tend to consume higher-priced goods such as computers, bedrooms, trips, etc. Situation determinants play an important role in influencing the behavior of the consumer and are factors independent of the individual and its characteristics, and related to the place and time of purchase or consumption, and know that it "The temporal and spatial conditions surrounding the purchasing and consumer position that temporarily affect the behavior of the individual without having to do with his or her personal characteristics or the elements of the marketing mix".

These effects fall into two sets of factors: A number of theorists have argued that certain fundamental decision-making styles can be identified. Based on these factors, the authors developed a typology of eight distinct decision-making styles: The Consumer Styles Inventory CSI has been extensively tested and retested in a wide variety of countries and purchasing contexts.

In addition to understanding the purchasing decision, marketers are interested a number of different aspects of consumer behaviour that occur before, during and after making a purchase choice. Areas of particular interest include: The consumer's perceptions of risk are a major consideration in the pre-purchase stage of the purchasing decision. Perceived risk is defined as "the consumer's perceptions of the uncertainty and adverse consequences of engaging in an activity".

The marketing literature identifies many different types of risk, of which five are the most frequently cited: If a consumer perceives a purchase to be risky, he or she will engage in strategies to reduce the perceived risk until it is within their tolerance levels or, if they are unable to do so, withdraw from the purchase.

Services marketers have argued that risk perception is higher for services because they lack the search attributes of products i. Experience goods, such as restaurants and clubs, can only be evaluated with certainty after purchase or consumption.

In the case of credence goods, such as many professional services, the consumer finds it difficult to fully appreciate the quality of the goods even after purchase and consumption has occurred. Difficulties evaluating quality after consumption may arise because the cost of obtaining information is prohibitive, or because the consumer lacks the requisite skills and knowledge to undertake such evaluations. Typical risk-reduction strategies used include: Within consumer behaviour, a particular area of interest is the study of how innovative new products, services, ideas or technologies spread through groups.

Insights about how innovations are diffused i. In addition, diffusion models provide benchmarks against which new product introductions can be tracked. A sizeable body of literature has been devoted to the diffusion of innovation. However, the exact shape and timing of curves varies in different product markets such that some innovations are diffused relatively quickly, while others can take many years to achieve broad market acceptance.

The diffusion model developed by Everett Rogers is widely used in consumer marketing because it segments consumers into five groups, based on their rate of new product adoption. An innovation is any new idea, object or process that is perceived as new by members of the social system.

Communication channels are the means by which information about the innovation is transmitted to members of the social system and may include mass media, digital media and personal communications between members of the social system. Time refers to the rate at which the innovation is picked up by the members of the social system. A number of factors contribute to the rate at which innovations are diffused through a social community.

Innovations with some or all of these factors are more likely to be adopted quickly. Accordingly, marketing communications may stress the innovation's relative benefits over other solutions to the consumer's problem. Marketing messages may also focus on compatibility and observability. Marketers can also facilitate adoption by offering limited scale trial e.

Studies have shown that the diffusion rate for many new technologies is speeding up. For example, it took decades for the telephone to achieve 50 percent penetration rates beginning in around , but it took less than five years for cellphones to achieve the same penetration rates. In order to explain the increasing pace of adoption, some have pointed to supply-side issues such as reduced barriers to entry and lower costs of innovation, [] [] while others have argued that consumers drive adoption rates because they place a high value on the convenience of new innovations.

Brand-switching occurs when a consumer chooses to purchase a brand that is different to the regular or customary brand purchased.

Consumers switch brands for a variety of reasons including that the store did not have the regular brand or the consumer's desire for variety or novelty in brand choice.

In the fast moving consumer goods market FMCG , the incidence of switching is relatively high. A great deal of marketing activity is targeted at brand-switchers. Marketers are particularly interested in understanding the factors that lead to brand-switching. The concept of switching costs also known as switching barriers is pertinent to the understanding of brand switching.

Switching costs refer to the costs incurred by a consumer when he or she switches from one supplier to another or from one brand to another.

Although switching costs are often monetary, the concept can also refer to psychological costs such as time, effort and inconvenience incurred as a result of switching.

When switching costs are relatively low, as in the case of many fast moving consumer goods FMCG , the incidence of brand switching tends to be higher. An example of switching that includes both monetary and psychological costs is when Android or Apple users wish to switch to a different platform, they would need to sacrifice their data, including purchased music tracks, apps or media and may also need to learn new routines to become an efficient user.

Channel-switching not to be confused with zapping or channel surfing on TV is the action of consumers switching to a different purchasing environment or distribution channel to purchase goods, such as switching from brick-and-mortar stores to online catalogues, or the internet. For instance, in Australia and New Zealand, following a relaxation of laws prohibiting supermarkets from selling therapeutic goods, consumers are gradually switching away from pharmacies and towards supermarkets for the purchase of minor analgesics, cough and cold preparations and complementary medicines such as vitamins and herbal remedies.

For the consumer, channel switching offers a more diverse shopping experience. However, marketers need to be alert to channel switching because of its potential to erode market share.

Evidence of channel switching can suggest that disruptive forces are at play, and that consumer behaviour is undergoing fundamental changes. A consumer may be prompted to switch channels when the product or service can be found cheaper, when superior models become available, when a wider range is offered, or simply because it is more convenient to shop through a different channel e.

Impulse purchases are unplanned purchases. Recent research carried out by Nielsen International suggests that about 72 percent of FMCG purchases are planned, but that 28 percent of supermarket purchases are unplanned or impulse purchases. Retailers use insights from this type of research to design stores in ways that maximise opportunities for impulse-buying. Research suggests that affect plays an important role in underlying attitudes, as well as shaping evaluation and decision-making.

Consumer researchers have noted the difficulties separating the concepts of affect, emotions, feelings and mood. The line between emotions and mood is difficult to draw and consumer researchers often use the concepts interchangeably. Studies have found that people in a positive mood are more efficient at information search activities.

That, is they are more efficient at processing information, are able to integrate information by identifying useful relationships and arrive at creative solutions to problems. Due to their efficiency processing information, those who are in a positive mood are generally quicker to make decisions and easier to please. Research consistently shows that people in a positive mood are more likely to evaluate information positively. Affect may play an important role in impulse-buying decisions.

Research suggests that consumers place higher weightings on immediate affective rewards and punishments, while delayed rewards receive less weighting. This occurs because the immediate emotional gain is a strong driver, and one that consumers can readily visualise whereas the more distant goal lacks sufficient strength to drive choice.

Customers who are in a bad mood are more difficult to please. They are slower to process information and consequently take longer to make decisions. They tend to be more argumentative and are more likely to complain. The relationship between affect and customer satisfaction is an area that has received considerable academic attention, especially in the services marketing literature.

In a meta-analysis of the empirical evidence, carried out in , Szymanski et al. Emotions elicited during consumption are proposed to leave affective traces in memory, traces that are available for consumers to access and integrate into their satisfaction assessments. Another [] meta-analysis finds: In addition, these variables are all significant predictors of brand loyalty. A third [] meta-analysis, from elaborates on the concept of brand personality bp: Second, the study finds that the effects of BP are stronger for mature brands than for brands in the early life cycle stages.

Third, sincerity and competence have the strongest influence on brand success variables e. Emotion can play an important role in advertising. In advertising, it is common to identify advertising with two different approaches to persuasion: Neuro-imaging studies suggest that when evaluating brands, consumers primarily use emotions personal feelings and experiences rather than information brand attributes, features, and facts. It is relatively widely accepted that emotional responses require fewer processing resources i.

Thus, by definition, loyalty has both an attitudinal component and a behavioural component. Dick and Basu proposed four types of loyalty based on relative attitude and patronage behaviour: Loyalty marketing programs are built on the insight that it costs times more to acquire a new customer than to retain an existing customer.

Broadly there are two types of program: In a Reward Program , the customer accumulates points for each purchase, and the points can subsequently be exchanged for goods or services. Whereas reward programs are motivated by the consumer's desire for material possessions, recognition programs are motivated by the consumer's need for esteem, recognition and status.

Many commercial loyalty programs are hybrid schemes, combining elements of both reward and recognition. In addition, not all reward programs are designed to encourage loyalty. Certain reward programs are designed to encourage other types of positive customer behaviour such as the provision of referrals or providing positive word-of-mouth WOM recommendations.

Loyalty marketing can involve the use of databases and sophisticated software to analyse and profile customer loyalty segments with a view to identifying the most desirable segments, setting goals for each segment and ultimately attempting to increase the size of the loyal customer base. Customer citizenship behaviour refers to actions that are not part of the customer's normal behaviour, that are of a voluntary or discretionary in nature and which are thoughtful, considerate and helpful.

Citizenship behaviour often requires some type of sacrifice on the part of customers. It also has the potential to improve service quality. The service marketing literature identifies a number of distinct types of citizenship behaviour: Traditional models of consumer behaviour were developed by scholars such as Fishbein and Ajzen [] and Howard and Sheth [] in the s and 70s. More recently, Shun and Yunjie have argued that online consumer behaviour is different to offline behaviour and as a consequence requires new theories or models.

Research has identified two types of consumer value in purchasing, namely product value and shopping value. Product value is likely to be similar for both online and offline shoppers. However, the shopping experience will be substantially different for online shoppers. In an offline shopping environment, consumers derive satisfaction from being within the physical store environment or retail landscape hedonic motivations. In the case of online purchasing, shoppers derive satisfaction from their ability to navigate a website and the convenience of online searching which allows them to compare prices and 'shop around' with minimal time commitment.

Thus the online consumer is motivated by more utilitarian factors. Consumers may use online platforms for various stages of the purchase decision. Some consumers use online sources simply to acquire information about planned purchases.

Others use online for making the actual purchase. In yet other situations, consumers may use online platforms to engage in post purchase behaviours such as staying connected with a brand by joining a brand community or by becoming a brand advocate by posting a product review or providing brand referrals vis social media. A particular problem that some e-commerce providers have encountered is that consumers who seek information online, turn to bricks and mortar retailers for the actual purchase.

Marketers have segmented consumer markets into different kinds of online behaviour in accordance with their behavioural characteristics online. Lewis and Lewis identified five segments based on the way that consumers use the Internet in the purchase decision process: Wendy Moe [] argues that in the offline environment, consumers who are shopping in stores can be easily classified by experienced sales employees only by watching their shopping behaviours.

These sales will approach them initiatively because they knew they look like the kind of consumers who are really seeking something to purchase, while other "hanging around" shoppers will generally be ignored by the experienced sales.

Such classification may not appear online, but Moe and Fader [] argued that by it is feasible to predict practical buying, surfing and searching action online by investigating click patterns and repetition of visit within online behaviour.

In addition, a report of E-consultancy about "benchmarking of user experience" outlined three kinds of online consuming behaviour as a valuable classification for the research of design of web pages to better serve different kinds of consuming behaviour. The three categories are: As the preceding table shows, the first row indicates the process of a consumer buying a new product, while the second and third row illustrates the positive influences the Internet could have on buying process by creating effective communications with online consumers.

For example, suppose a consumer carelessly see an advertisement about laptops on Wechat , a popular Chinese social media developed by Tecent. He begins to feel that his laptop is a bit out of date and want to buy a new one, which the outcome of good advertisement placed on the daily Internet tool.

He doesn't know anything about how to buy a new one as business change so fast today, so he search on Google to find out the answer. On the result page, what he finds out is the promotional ads which mainly come from JD. Com two main Chinese competitors of online retailer at this field. As always, he used to prefer JD. After careful selection, he makes his order through payment of Wechat , which was placed inside of JD. To gain insights into consumer behaviour, researchers uses the standard battery of market research methods such as surveys, depth interviews and focus groups.

Increasingly, researchers are turning to newer methodologies and technologies in an effort to seek deeper understandings of why consumers behave in certain ways. These newer methods include ethnographic research also known as participant observation and neuroscience as well as experimental lab designs. In addition, researchers often turn to separate disciplines for insights with potential to inform the study of consumer behaviour.

For instance, behavioural economics is adding fresh, new insights into certain aspects of consumer behaviour. Ethnographic research or ethnography has its origins in anthropology. However, marketers use ethnographic research to study the consumer in terms of cultural trends, lifestyle factors, attitudes and the way that social context influences product selection, consumption and usage.

Ethnographic research, also called participant observation , attempts to study consumer behaviour in natural settings rather than in artificial environment such as labs.

Different types of ethnographic research are used in marketing including; []. Trendspotters such as Faith Popcorn 's BrainReserve make extensive use of ethnographic research to spot emergent trends. Consumer neuroscience also known as neuromarketing refers to the commercial use of neuroscience when applied to the investigation of marketing problems and consumer research. Some researchers have argued that the term consumer neuroscience is preferred over neuromarketing or other alternatives.

Consumer neuroscience employs sophisticated bio-metric sensors, such as electroencephalography EEG , functional magnetic resonance imaging fMRI and eye tracking , [] to study the ways that consumers respond to specific stimuli such as product displays, brands, packaging information or other marketing signals.

Consumer neuroscience has become a mainstream component of consumer research methods. International market research company, Nielsen Research, has recently added neuromarketing to its services by acquiring Innerscope, a company specialising in neuromarketing research thus enabling Nielsen to add neuromarketing research to the suite of services available to clients. From Wikipedia, the free encyclopedia. Behavioral targeting Brand ambassador Broadcasting Display advertising Drip marketing In-game advertising Mobile advertising Native advertising New media Online advertising Out-of-home advertising Point of sale Printing Product demonstration Promotional merchandise Publication Visual merchandising Web banner Word-of-mouth.

Diffusion of innovations and Bass diffusion model. Loyalty marketing , customer retention , brand loyalty , loyalty program , and customer loyalty program. Belief Systems, Religion, and Behavioral Economics. Influences on the choice of Recommendation Sources, Journal of Consumer Research.

Journal of Consumer Research Inc. National and International Perspectives, Jagdish N. History, Theory and Politics, Sage, , p. Hirschman and Moris B. Holbrook eds , Provo, UT: Association for Consumer Research, , pp Theory and Applications , Pearson Australia, , p.

The essence of Marketing". International Journal of Educational Administration. Association for Consumer Research, , pp , Online: Holbrook eds , Advances in Consumer Research, Vol. Association for Consumer Research, pp , Online: A Comment, Journal of Marketing, July, , pp online: Jansson-Boyd and Magdalena J. Zawisza eds , Routledge, , p. Do Purchase Intentions Contribute to Accuracy?

Impulse buying, reasons why, consumer electronics - Oh My. Computers in Human Behavior. Cengage Learning Australia Pty Limited. Taking the example above customers may have a tax problem and need advice. So their pain is pretty acute. They will look for a business to provide peace of mind and help them to stop worrying. For example if they buy every two months then if you use email marketing you can make sure those on your list get offers at this time.

Knowing how often they buy can also be used when deciding what type of product or service you offer. Sometimes customer buy on behalf of others. A classic example is mothers buying for their children. The ones that use or consume your products or services can have a big influence on the buyer so you need to make sure you consider both in your marketing. If you have a range of products and services it is a good idea to understanding which particular products or services they buy on a regular basis.

Having this understanding helps you make strategic decisions. Such as whether you keep the whole range or focus on one or two key products or services only. Today there are many channels available for customers. Increasingly customers are buying directly from websites or online stores. Understanding their preferences allows you to focus on the key channels to increase the opportunities for them to buy from you.

It is helpful to understand where they get the information and who they listen to. These sources could be friends, websites, online reviews or influencers. As many customers will visit your website as part of the decision making process it is so important to ensure your content is rich. Do you want to get new customers? If you do, I can help.

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What is consumer behavior?

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Understanding consumer behavior is a broad and complicated task, but with the right research mix you can begin to get a detailed understanding of your customers and their motivations.

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Consumer behavior involves services and ideas as well as tangible products. The impact of consumer behavior on society is also of relevance. For example, aggressive marketing of high fat foods, or aggressive marketing of easy credit, may have serious repercussions for .

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Consumer behavior is all about the way people buy and use products and services. Understanding consumer behavior can help you be more effective at marketing, design, . Consumer behavior is the study of how people make decisions about what they buy, want, need, or act in regards to a product, service, or company. It is critical to understand consumer behavior to.

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Understanding Customer Behavior: Needs and Motivation By Harper Phillips on April 2, Now that you know who your target market is on a superficial level, you can use that information to deepen your understanding of your customers as individuals, and learn what drives them. The Traumatized Brain: A Family Guide to Understanding Mood, Memory, and Behavior after Brain Injury (A Johns Hopkins Press Health Book) Oct 22, by .